What are the Basic Principles of Marketing?
So you want to do marketing. You’ve got to know the rules, but what are they? On our web site we try to give you the ideas you need to do marketing, but often the strategies and tactics and day to day operations make us forget some basic principles.
We wouldn’t waste your time talking about these rules, except we spend a lot of time in front of executives and we know that some of these ideas are easily forgotten and often controversial.
We are not the types to side-step controversy and we’re committed to underlining the enduring ideas of marketing - i.e., those that will be around long after the internet is firmly part of everyday life and off the headlines of trendy web sites and magazines. So, here are some of our basic rules of marketing.
REALITY AND PERCEIVED REALITY ARE DIFFERENT
Ok, you’ve heard it before - but don’t forget it. Not sure? Why do you think there are so many prices with 99 at the end, like the gas you buy almost always ends in a 9 (or 9/10s). We academics have studied this and recognized long ago that people see a significant difference between say $1.00 and 99 cents. The reality: 1 penny. In perceived reality, a lot.
The same goes for just about everything else in marketing. Look at the salt in your kitchen. It probably is Morten salt, but it’s just salt. Why would you buy something with a stupid brand name? Because you and everyone else decides and buys product based on perceptions, not reality.
And before you start thinking this is only relevant to consumers, think again. Companies, purchasing agents and everyone else in a company buys on based on perceived reality as well.
So, if you're not playing on the field of perceived reality, you're not doing marketing!
COMPANIES AND CONSUMERS REALLY BUY BENEFITS (EVEN THOUGH THEY PURCHASE FEATURES!)
That’s right. You might think that people buy features because you’ve seen them looking over the feature set for a Palm Pilot, a computer, and even a car. People do consider the features that any product has, but they buy based on the benefits these features provide. A good way to think about this is through a newspaper analogy. The benefits are the HEADLINES, the features is the story. People buy based on the headlines, even if the details lie in the accompanying story.
Confused about the difference between a benefit and a feature? Read our tutorial on the subject.
NOBODY THINKS ABOUT YOUR PRODUCT AS MUCH AS YOU DO
You are undoubtedly thrilled with your product or web site. You probably dream about it and obsess over everything about it. But everyone else doesn't. They have lots of other things to think about and only have a couple of neurons to devote to what you offer. That's why positioning, differentiation, branding, and all the other things that make up marketing are so important. Accept it...and tell other people in your company to accept it as well.
EVERYBODY MAKES TRADE-OFFS
This is a difficult concept for people to understand, but it’s true. To see why it’s difficult to understand, consider how important most people feel that "price" is in a customer’s decision making. They make this assumption based on the idea that everybody likes a good deal. That’s true, we all like a good deal. We mostly all like a low price, too.
But people and companies are all the time trading off price for getting something in return. The net of this is that while price is important to everyone, it is not the "most important" part of a decision for everyone - just for some customers. You can read more about this in our tutorial on "How Do Customers Make Trade-Offs".
EVERY COMPANY TENDS TO BELIEVE THEIR "MARKET" IS UNIQUE, BUT THIS IS RARELY TRUE
No matter how complicated the product, no matter how expensive the product, no matter how technical or scientific the product, and no matter how much the people in the company want it to be true!
Markets and marketing tends to be the same. We've seen it in the computer industry, the packaged goods industry, and even with companies who sell satellites and military equipment. Segmentation is still applicable, people make trade-offs, advertising works in it’s typical vague and unusual ways, branding still matters, etc., etc.
As you know, many people think the Internet requires new rules - but we don’t think so here at MarketingProfs.com. We're beginning to gather evidence for this. For example, read our article on "The New E-Marketing Rules".
Then read our article (Gambling for Groceries with Priceline.com) from 6 months ago where we argued that Priceline wouldn’t work for groceries. Then, consider that Priceline.com just got rid of their grocery business (October 5, 2000) and their business model (considered by many as the prime example of the Internet’s uniqueness) is being questioned as sustainable. Why, in part, because the market isn’t that unique. People often get tired of new gimmecks, just as in the off-line markets.
The point is you need to understand the basic principles and ideas in marketing if you want to succeed. We believe you can get this information right here - so enjoy our site.
