WHITE PAPER 1 AN INTRODUCTION TO TECHNICAL MARKETING

Transcription

1 WHITE PAPER 1 AN INTRODUCTION TO TECHNICAL MARKETING

2 AN INTRODUCTION TO TECHNICAL MARKETING Technical Marketing is a term that seemed for us to sum up the processes and disciplines involved in business-tobusiness marketing for companies operating in a technical environment. That was some ten years ago now, when there were both more businesses directing their own marketing strategies and fewer involved in marketing technical products and services. Today the march of technology reaches deep into everyone s life and many of the practitioners of marketing strategy have retreated from those companies, both large and small - companies who now need an integrated marketing strategy more than ever. Because businesses now operate with leaner, and supposedly fitter, staffing levels, the conventional marketing department is far less frequently encountered. Many large multi-national businesses have sought to imitate smaller companies because they see their smaller size and speed of response as both a threat and an advantage. They have divided their operations into business or cost centres, effectively creating small companies within the group, with a business manager or management team charged with running the operation to achieve mainly financial targets. Major marketing decisions, even creative services are typically supplied by a central group that has little or no day to day contact with the market place. The local role of marketing, if there is one at all, has diminished to the provision of marketing services. But more often, marketing is just one of the disciplines the business unit manager will have to cover with perhaps the support of a marketing services coordinator. Small to medium size enterprises are not so very different, except the company s destiny is within their own control and not guided by a marketing group on another continent. For smaller an d medium enterprises (SMEs) the cost of running its own marketing operation can be too high to afford in a business environment where prices in real terms are being depressed. Where technical marketing is particularly pertinent is for those business unit managers or directors of SMEs who will often themselves have graduated in a technical discipline. They have a need to understand their product or service to communicate with an increasingly knowledgeable customer base. Typically these managers may be engineers who now find that they need to be equipped with a range of business and human resources skills to manage their operation profitably. It is these people for whom technical marketing will have most appeal. Because it approaches the subject with the rigour and analysis of engineering, looking at 2000 Technical Marketing Ltd WP1: An Introduction to Technical Marketing. Issue 1 2

3 the whole process from product specification, development and manufacture through to communicating the product s attributes to the target audience; and then following this through into an after sales strategy. But technical marketing can equally benefit non technical managers who may not have the grounding in engineering thinking, but still have the same requirements to follow the disciplines needed to conceive and bring products to market, but lack the resource or skills to do so. Ten years ago when we were formulating and experimenting with these concepts, some of the tools we needed had not developed to the stage they have today. But now the Internet and growing e-commerce business provide the communication means that allow small niche companies to be global players - or to be crushed by global competition if they do not adapt and market their products in the new paradigm. Technical marketing is now even more relevant in a fast changing, technology driven global economy, than it seemed when we first started evolving our ideas from a conventional marketing approach. Why technical marketing? The philosophy of conventional marketing owes its origins to marketing consumer products and developed from an economic derivation of the discrepancies noted between classical economics of supply and demand, compared to the reality of the market place. Why for example could some products command a premium price compared to others if price was simply a function of supply and demand? For years economists concentrated on production and consumption and even political theories were based on an imperfect economic model. To this model was added distribution and exchange of goods, but the role of the consumer was largely ignored. That the consumer had a say was not part of the argument until the mid nineteen thirties when Keynes suggested that there might actually be a deficiency of demand. As the consumer had more and more discretionary income to spend or withhold, so the need to promote and advertise became more important, the idea of brands became better established and marketers sought to differentiate their product offering from the competition. However, there was still a heavy emphasis on production and limited consumer choice in so far as the consumer could select between different products, but rarely could specify what he actually wanted himself at an affordable price. Today we are on the verge of a new paradigm. One of mass customisation, rather than mass production. The consumer can become the specifier at last and it is up to the 2000 Technical Marketing Ltd WP1: An Introduction to Technical Marketing. Issue 1 3

4 supplier to deliver products economically to meet individual consumer demand. The business-to-business (b-2-b) world adopted consumer marketing ideas and then applied them to trading at a business level, to some extent eliminating much of the hidden persuaders and psychology of the consumer world and concentrating on promoting goods and services to other business users. Classical marketing of course owes a great deal to attempting to explain consumer behaviour. Technical marketing starts in the logical, engineering world of acquiring information, setting objectives, planning, implementing and reviewing. It is an approach that should be equally welcome to those who have a technical or engineering background as well as those who have studied in other disciplines, but now have to market products to a more technically sophisticated audience in a more technically aware world and using communication means that themselves rely on technology. Thinking it all out from the beginning One major difference by starting from a logical engineering based approach is that the process becomes more disciplined. When Isambard Kingdom Brunel conceived his Great Western Railway he looked at all aspects of a great plan. Not only did he survey and plan the track, the locomotives and rolling stock, but every other detail including railway stations, workshops and even a steamship to complete the journey from London to the Bristol terminus, then on to New York. It was a grand scheme with a clear view of what it was for and how it was to be implemented and put into practice. Generally today we do not have the clean sheet of paper or the opportunity to fund such a massive undertaking, but the general principles of seeing the whole picture still hold good. Too often the marketing co-ordinators charged with producing a product leaflet or an advertisement have little concept of the grand strategy or why the product has been produced in the first place. Unfortunately it is not uncommon when asking why the product was designed, to discover that the person seeking to put the marketing communications in place does not know. How on earth can the communication be successfully delivered to the right people if the person charged with presenting the message thinks it can be achieved by taking a photograph and putting down the measurements and price on a piece of paper? Unless everyone throughout the organisation shares the same vision, has the same understanding of the reasons why the product has been developed, then they will create their own isolated working environments. Again this is all too often encountered. A complete 2000 Technical Marketing Ltd WP1: An Introduction to Technical Marketing. Issue 1 4

5 divisional culture grows up to justify the life and purpose of each division that has little to do with the customer s requirements. In a technical marketing programme, all relevant people must be part of the process from the beginning. Not only will this ensure a co-ordinated and truly integrated programme, but it will help avoid repetition of work. Doing the task once is a fundamental maxim of the technical marketing approach. Far too often the same work is wastefully repeated at different stages and in different departments or areas of activity. Business today can neither afford the cost, or delay caused by such a confused approach. Where things go wrong Of course businesses do not start life this way. Growth, either organic or through take-overs of other businesses can serve to lose the original focus. Duplications become an inevitable consequence as the guiding directions of the founder become obscured in two or more different cultures. The product range can start to lose any sense of cohesion and as companies grow, so too can the burden of managing the installed base of products, maintaining spare parts and service all become considerations that new and more vigorous competitors do not yet have to face. This diversion of focus away from exploring new market opportunities can sometimes leave a company exposed when the markets they have traditionally served decline or collapse it is then too late to develop the products and structures needed to serve the new markets. All the product management effort has been poured into keeping the existing range propped up. Other causes for problems are when the company becomes dominated by a manufacturing or even by an R&D group. Manufacture only exists to provide the products the customer wishes to buy. However, the smooth running of a manufacturing plant is frequently at odds with the whims of the buying customer. The products which the factory likes making, because they are easy to process, or yield most recovery do not often correspond with the buying patterns of customers. If factories were allowed a free hand, huge stocks would be created of these favoured products, while those the customer actually needs would be in short supply. But it is just as dangerous for the research and development team to control the agenda. Again given a free hand they will focus on the projects that interest them most and will enhance the specification to satisfy their own interests, often pricing the resulting product out of reach of all but a few customers. Only with a technical marketing agenda can these operations be harnessed and directed to design and manufacture the products that the customer is willing to buy and which can earn profits for the enterprise. But it is just not the marketing 2000 Technical Marketing Ltd WP1: An Introduction to Technical Marketing. Issue 1 5

6 team or person with marketing responsibility who has this responsibility the whole company must share and participate in the technical marketing vision. The directors must set clear business objectives which can be understood and indeed implemented at all levels so that each individual can recognise that he is making a direct contribution to meeting the objectives. Unfortunately too many companies set their objectives in such generalised or financially expressed terms that they are unusable outside the boardroom. A company that sets an objective of returning a certain percentage on net assets employed will find communicating this in a tangible way to its employees a challenging task, when typically it is only the Finance Director who knows what it means. If instead the objective is to become market leader, or specialist in a sector or even lowest priced supplier, then these objectives can be more readily translated into specific goals that can be understood and acted upon at different levels. The whole process of new product development will then take on a focus in terms of developing the products needed to meet those goals, to design them for manufacture at the right pricing point and deliver them to market to meet customer expectations. The whole company can bring their particular areas of skill and expertise to bear in working towards the goals of the enterprise as a whole. Benefiting from an integrated approach With the whole company working towards known, understood and realistic goals another great advantage of the technical marketing philosophy becomes possible. Encapsulated as thinking once only it allows the analytical stage to set the agenda for the enterprise as a whole and not to have to re-think strategy and direction at every turn, it becomes part of the culture of the business. Translated to operational decision making, having an understanding of the company s objectives and viewing each key decision in this light can be extremely powerful. If for example the company has set its sights on being the market leader, when determining product development plans these will be tested against the planned product s capability to fit with these aims. One company for example, not necessarily concerned with being the most innovative or even first to market with new products had a shared vision that the products it produced would be for the highest volume demand in the sector. As a consequence, while much research went into the development of the product that would occupy that market position, as much effort was invested in ensuring that the production 2000 Technical Marketing Ltd WP1: An Introduction to Technical Marketing. Issue 1 6

7 resources could deliver the product reliably and at a consistent quality. Competitors were frequently first into the market with the new concept and did much to generate demand, but they generally failed because the product was not reliable, or they could not respond to demand which is where the other company with its clear strategy of being able to deliver on performance and availability then gained the leading share of the sector. The logical extension of thinking once to save thinking out the same problems over and over is that greater efficiency is achieved throughout the organisation as everyone knows what to do and does not have to keep pausing to constantly re-evaluate what it is they are trying to achieve. Working in a totally integrated way will result in greater efficiency and competitiveness. This technical marketing philosophy, worked throughout he organisation will then start to give rise to another terribly valuable asset a fund of knowledge and experience. It is essential to manage this company knowledge base effectively. Managing the company s knowledge base Knowledge has a degree of intangibility, but it can and must be harnessed and recorded. It is as much about the processes and experiences of working in a market and developing products for that market s customers that leads to a company having and being perceived as leaders. Taking this moral high ground in an industry can be a major benefit as users will invest considerably more trust in a company they respect as understanding the market, mastering the technologies and possessing the people who can be relied upon to dispense this advice, guidance and recommendation. Purchasing that company s products is then the logical conclusion. A company can achieve this leadership role generally only by its actions and track record, but a great deal can be done through a technical marketing approach to develop this position of authority. It takes the company into a wider circle, beyond the buyers and much more to the influencers, the advocates, consultants and specifiers as well as academics and people studying today and will in due course move into these roles. Most industries will have a guru a person who somehow personifies the wisdom and expertise of the industry and who can pronounce equally on new developments or on accepted and tried and tested practice. Employing, or being associated with the industry guru will help mark the company out as having the key authority of the industry. At one level helpful information can be published through books, articles, 2000 Technical Marketing Ltd WP1: An Introduction to Technical Marketing. Issue 1 7

8 lectures, seminars and papers all with one aim, influencing the market favourably towards the knowledge and experience of your company. But it is even more important to manage the knowledge base internally. Knowledge will encompass both technical know how of processes and procedures as well as market knowledge about customers and applications and much of this can be recorded and maintained in a database. Today, the facility to have both an extensive and accessible bank of knowledge has never been more practical. No longer should areas of knowledge be hoarded by an individual or department to protect their personal interests now the sum of the company s acquired knowledge is the essence of that business and needs to be open to decision makers at all levels. Technical marketing a new philosophy Total involvement, setting clear objectives and strategies, a shared vision throughout the company, prudent management and access to the company s knowledge base are just a few of the key elements in a technical marketing philosophy. A philosophy which re-thinks the approach to business-to-business marketing. That instead of adopting consumer ideas for b-2-b, stands the approach on its head. Neither does technical marketing start with theories derived from economic models. Instead it takes an engineering discipline which is one of simple practicality. It attempts to look at the world and business environment as it is, to gather the facts, look at an overall game plan and instil a culture throughout the organisation which can deliver profitably, products that the market needs. Technical marketing recognises the importance of the company s knowledge base as a key asset and seeks to manage this for the benefit of the entire business. Because in our day to day dealings with b-2-b clients at various levels product advice, marketing communications and selling we realised that marketing skills and experience are less and less in evidence, we set up Technical Marketing Limited in mid Technical Marketing Limited is a registered company incorporated in the United Kingdom with its head office in London, but it is also a product of the new paradigm of Internet commerce. Technical Marketing Limited is not a bricks and mortar company, although it does have tangible assets it is a virtual company whose primary existence is the Internet. Just as many SMEs and divisions of major global companies now have little or no full time marketing personnel at a strategic level, neither does Technical Marketing Limited have the high overheads of premises and staff that require conventional consultancies and agencies to charge such high fees. Our mission is 2000 Technical Marketing Ltd WP1: An Introduction to Technical Marketing. Issue 1 8

9 to provide the range of marketing support from strategic planning to implementation that we believe many b- 2-b companies now need, but to provide this in a cost effective way. Not through long and expensive face-to-face meetings, but by using the power of modern technology to deliver results in a cost efficient way and by becoming an integral part of your team. Why can we offer this? Because Technical Marketing Limited has assembled a powerful team of experts with years of experience in industry and commerce which is practical and learned through real hands on experience particularly in the UK, European and North American markets. Not only have we people who have operated at board level, but also in new product development, engineering, service support and marketing communications, both client side and agency. We can call on specialist skills for a wide range of tasks from project management to producing technical information, from a total strategic plan to a web site, from new product development to a datasheet. We believe we can deliver you real results we have a clear philosophy based on the technical marketing process outlined above, we have years of experience, we have low overheads and we operate internationally. Perhaps we should be talking to you now? More about technical marketing We have created a series of White Papers that address a number of different aspects of the Technical Marketing philosophy in a little more depth. You are free to download these and use them as you wish, but these merely look at some of the issues. They are not complete solutions in themselves, but do indicate some directions to follow. They are written primarily for those managers who are charged with running a business operation and do not have specific marketing training. They should be of particular interest to those who themselves have a technical background and operate in a technical/industrial business-to-business environment. In due course these White Papers will be developed into a fuller text and published as a Technical Marketing book, available both on the Internet and in hard copy from bookstores. Not everyone will be convinced that they need any marketing assistance. Maybe these White Papers will provoke some thoughts sufficient to contact us to see whether we can help you improve your business. Perhaps you are looking to enter new markets in Europe or the USA do you have the right products for the market, do you have the right support collateral, the distribution? Perhaps you are looking to import into the UK, or France or Italy or Germany or the USA? Again, does the market want your product? What benefits can you offer? 2000 Technical Marketing Ltd WP1: An Introduction to Technical Marketing. Issue 1 9

10 Or maybe you already do all these things well. But how well is your company knowledge base managed? Do you know and correspond regularly with all your customers? You do, then what about your prospects, how do you address them? Do you even know who they are? You probably already have a web site, but is it working for you? Is it kept up to date? If we have started you thinking at all good! If we can be of some assistance or you would like to know more about technical marketing in a new global business era, the new paradigm, then why not call on +44 (0) , or contact us through the submission form? What do you have to lose? You may find there is a great deal to gain! Technical Marketing Ltd P.O. Box 9102, London, SW14 8ZE, UK Tel: +44 (0) Fax: +44 (0) info@technicalmarketingltd.com 2000 Technical Marketing Ltd WP1: An Introduction to Technical Marketing. Issue 1 10