5 Actions: Marketing is Key
January 2010
Although the changing of the calendar is a relatively arbitrary event, it is nonetheless an opportunity many of us take to review the past year and make plans and resolutions for the coming twelve months. We just passed a very difficult period for manufacturing but all indicators are that it will likely be a long and slow recovery. Business is improving on almost all fronts but we are feeling chastened by the recent challenges and conservatism is the order of the day. The point I’d like to make this month is — Don’t continue to fight last year’s war. Once burned, it is natural to feel ‘gun shy’. Nobody wants to be burned twice. So, if we were burned last year, the tendency is to hold back and try to avoid another scalding. Ironically, that makes it more likely that we’ll miss the next turn of the market.
Learn from the experience but put the past behind. It is especially important for manufacturers to focus on better forecasting and improved agility to avoid being caught either ahead of or behind the recovery. We offer the following 5 actions as the essence of that effort. The last point is particularly important. Marketing drives sales activity. If you market like there’s a recession, that lack of effort will likely generate (or perpetuate) a recession. Marketing is a leading activity. Sales lags marketing. So get out front and shape demand in your favor.
Here are the 5 actions we are recommending for manufacturers:
1. Watch demand closely as it is likely to change rapidly (and probably fluctuate considerably) as the economy works its way back to health
2. Tighten your forecast update cycle — that is, work harder at refining and updating the forecast more often
3. Collaborate more closely with customers and prospects to better understand their plans and needs
4. Reduce your reaction time (lead time) in order to reduce your dependency on longer range forecasts. Once again, good forecasting emerges as a key factor in business success.
5. Finally, remember that you don’t have to sit back and meekly accept demand as it may come. You can influence demand through aggressive marketing and sales actions in what the analysts call “demand shaping”. There’s an old saying that “it pays to advertise”. I’d say that’s true, but limited. In today’s world, it pays to focus on the customer – understand demand (forecast), shape demand (market and sell), and react to demand (shorten lead times).
What are your plans for the New Year …
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