It should not come as a surprise that traditional marketing has become less effective in this new Internet driven era. The following is a quote from a harvard business study by Bill Lee.
“First, buyers are no longer paying much attention. Several studies have confirmed that in the “buyer’s decision journey,” traditional marketing communications just aren’t relevant. Buyers are checking out product and service information in their own way, often through the Internet, and often from sources outside the firm such as word-of-mouth or customer reviews.
Second, CEOs have lost all patience. In a devastating 2011 study of 600 CEOs and decision makers by the London-based Fournaise Marketing Group, 73% of them said that CMOs lack business credibility and the ability to generate sufficient business growth, 72% are tired of being asked for money without explaining how it will generate increased business, and 77% have had it with all the talk about brand equity that can’t be linked to actual firm equity or any other recognized financial metric.
Third, in today’s increasingly social media-infused environment, traditional marketing and sales not only doesn’t work so well, it doesn’t make sense. Think about it: an organization hires people — employees, agencies, consultants, partners — who don’t come from the buyer’s world and whose interests aren’t necessarily aligned with his, and expects them to persuade the buyer to spend his hard-earned money on something. Huh? When you try to extend traditional marketing logic into the world of social media, it simply doesn’t work. Just ask Facebook, which finds itself mired in an ongoing debate about whether marketing on Facebook is effective.”
Three excellent points that summarize what I have known for some time. When people are making a purchase decision they want to know if they are making the right choice. This is mostly done by talking to others that have done their own research. Word of mouth and social media are quickly becoming more effective ways for purchasers to insure they are making the right decision. If social media companies were really on-the-ball, they would create a feature for their client software that allowed users to seek out product reviews.
Recommendations always mean more when they come from people that you know. Many firms spend large sums of money to purchase the resources of market influencers. Bloggers and customer advocates are always looking for things to write about. Microsoft has an advocate call “Mr. Excel”. His web site gets more hits than Microsoft’s own excel web pages. He is not paid by Microsoft, but they seek his advice and provide him with inside information about product features and changes. Apple has a similar web site that is regularly visited by Apple enthusiasts. (http://www.macrumors.com/)
So what is the modern CEO to do? Get rid of the high maintenance marketing person and promote the fresh new thinkers. Seriously cut the marketing budget and feed the savings into supporting innovations that will continue to generate decent returns.