Anthony Davidson

Marketing & Sales

Strategy versus marketing

What’s the difference between strategy and marketing? Often it seems like we’re addressing the same questions or decisions – where to play, how to win, and what is required to succeed – but there’s a bit more to it. UQ MBA Alum Chris Gaffee posed the question as he discussed his journey from learning marketing in his MBA, applying this knowledge to his first startup, and then becoming a strategist at Monitor Deloitte. Marketing provided Chris with the ability to understand opportunities from a customer perspective and then develop go-to-market strategies for his product innovation. Through this startup, he learned first hand the challenges early stage businesses face when market conditions rapidly change as a result of a pandemic. And the strategic choices that need to be considered when deciding whether it is viable to continue. Ultimately, this experience influenced Chris to embark on a career in strategy consulting and to help clients solve complex problems around business growth. So what is the difference between strategy and marketing? Strategy is primarily concerned with the direction, goals and priorities for a business – decisions about why we are in business, what we are trying to achieve, and how we can do it. Marketing is primarily concerned with the way that value is created with customers, employees, partners and other key stakeholders – decisions about who we serve, what we offer, and how we engage. Thanks for sharing your journey and experience Chris. #strategy #marketing #valuecreation

Anthony Davidson August 16, 2022

Digital

Optimise marketing and sales

How do you strengthen the relationship and alignment between marketing and sales? Enable both areas to invest in helping each other succeed. Martin van der Linde has seen first-hand how dramatic the results can be. Martin kindly gave another presentation to my MBA students this week on digital marketing practice. As GM Marketing at Noja Power, Martin works closely with his Sales counterpart to optimize the marketing and sales process for this world leader in Medium Voltage Electrical Equipment. Integral to their rapid growth and success – doubling the size of their global business within 5 years – has been the commitment of the marketing team to generate qualified sales prospects using inbound marketing and the focus of the sales team in responding, developing and converting prospects. But there’s more to the story. The sales team plays a critical role in educating and assisting the marketing team to better understand the technical needs of different customers and the type of content that will resonate and attract customers to the Noja Power brand. This enables the marketing team to make the brand visible and relevant to prospects during their search and evaluation process. Using marketing technology to monitor interactions, better qualified leads that demonstrate intent can be generated for sales follow up, optimising sales effort and sales conversion. The marketing team also has a vested interest in understanding the effectiveness of the sales process, and how to contribute to improving it through better quality information about prospects. Thanks again Martin for sharing these practical insights about how to optimize marketing and sales performance. #digital #marketing #sales

Anthony Davidson August 9, 2022

Pricing

Don’t leave money on the table

Are you leaving too much money on the table? Many businesses have an ad hoc approach to price optimisation, revenue management and profit maximisation. Associate Professor Len Coote showed MBA students how to take a more systematic approach to solving these complex optimisation problems. A micro-economic lens enables business managers to better understand consumer demand, consumer willingness to pay, and consumer surplus. Determining the slope of the demand curve is a prerequisite for pricing policy and strategy. What is the price elasticity of demand, how sensitive are customers to changes in price, and at what price point is revenue or profit potential optimised? More importantly, how willing are customers to pay for different product features and benefits? Do different customer segments exist in terms of their willingness to pay for different offerings? If so, what is the “consumer surplus” – the difference between the market price and the price customers are willing to pay. This logic can be extended to the way we price new products as well. By testing consumer willingness to pay for different bundles of features and benefits at different prices, we can estimate which offering will create greatest return on investment. It’s time to move from ad hoc pricing decisions to a systematic, evidence-based approach to price optimisation, revenue management and profit maximisation. Thanks Len for your insights and methods in this critical area of marketing. #marketing #pricing #willingnesstopay

Anthony Davidson August 3, 2022

Customer Experience

Focus customer experience initiatives

While customer experience remains a top business priority, many CX initiatives continue to fail because of poor design and process. MBA students had the opportunity to learn and experience the Human-Centered Design approach to CX with expert Bartley Hassell from 3RD View Consulting. Bart was kind enough to share the methodologies developed by 3rd View to help organisations focus CX initiatives to ensure that problems are properly defined, projects have full buy-in and endorsement of leaders, and stakeholders are effectively engaged. At the heart of these methodologies is a commitment to understand complex human systems and find solutions that improve the human experience – whether it is from a customer or employee perspective. Many CX initiatives fail because they are too broad or too focused on quick fixes. Taking the time to properly understand and define the real problem to be addressed is the starting point. Ideation can then be used explore a range of possible solutions for prototyping and testing to determine the optimal solution for enhancing customer experience. So design is critical but so is process. As we found out through a live demo facilitated by Bart, customer journey mapping can be a powerful tool for understanding and learning, as well as disrupting. Thanks for a memorable experience Bart. Great session! #CX #HCD #3RDVIEW

Anthony Davidson July 27, 2022

Marketing & Sales

Make an impact with marketing

One of the challenges facing marketers is deciding where and how to make a difference. CMO Chris Jacko spoke to us about his experience in marketing roles and the importance of focusing marketing efforts to make an impact with limited resources. This involves tradeoffs – hard decisions about which customers to serve (and not to serve), which products to prioritise (and not prioritise), which data and analytics to focus on (and not focus on), and which marketing technology to leverage now (and in the future). Although marketing spend is often considerably higher than other functional areas, expectations are also higher about the impact that marketing should have on business performance. On one hand, this requires marketing leaders to educate stakeholders about the role and contribution of marketing. But in the end, it is about credibility, transparency and accountability – demonstrating the return on investments in brand building, lead generation and customer engagement. Thanks Chris for your insights and practical advice today. Much appreciated. #marketing #effectiveness

Anthony Davidson July 20, 2022

Governance

Your role in the business

What happens when your skills and abilities to set up and grow a business are not sufficient to take it to the next level? A key challenge facing many business owners is determining their future role in the business and how they can best contribute to its success. Today’s Owner Manager Program explored the different stages of the business lifecycle and changing leadership roles that business owners play to build a sustainable business. As a startup, owners are the doers and decision-makers. But as the business grows, their role changes to delegator and direction-setter. With rapid growth, the role again changes to that team builder, coach, planner and communicator. As the business enters a new phase of sustainable growth, this role shifts to that of strategic innovator, change catalyst, organization builder and culture leader. For many owners, this can be daunting especially if they lack the knowledge and skills to take on these new roles. Enter the management team. Successful business owners understand their strengths and limitations, and build a management team with the capabilities to take the business to the next level. Picking the right team members makes it easier for owners to let go and take on new roles because it instills confidence and trust. But learning from “bad picks” is equally important because it make owners more committed to finding the right people for each stage of the business. What are potential new roles for owners who lack the leadership or management skills to take the business further? Often owners will step back from leading the business and take on an operational role. But this can be counterproductive and undermine the new leader. Another solution is to take on “strategic projects” that leverage your existing skills and experience and make a valuable contribution to the business. Depending on your motivation and willingness to develop new skills, taking on a proper director/Board role in the business may be the best solution to protect ownership interests and contribute to the future direction of the business. The final solution is to consider your exit from the business and the timing of it. Ultimately, these decisions are up to you as an owner. Being clear about what you want and how you can best contribute makes the decision easier. #strategy #leadership #businessowner

Anthony Davidson July 13, 2022

Cocreation

Cocreate value propositions

How are value propositions created? The traditional approach is to develop a generic proposition based on your understanding of what stakeholders value. But this approach is inadequate and typically ineffective. Value propositions should be cocreated, stakeholder-specific, and dynamic. Yesterday, I facilitated a workshop with health professionals to explore how to cocreate value propositions with stakeholders to introduce and sustain new models of care. A value proposition should be viewed as an invitation to stakeholders to participate in creating a mutually beneficial solution. By adopting this perspective, we suddenly appreciate that value propositions are not just simple value statements. Value propositions have to be negotiated through a dynamic, iterative process where stakeholders learn about each other’s goals, expectations and competing priorities, and decide whether and how to collaborate together. The starting point is to understand the context for cocreating a value proposition with a stakeholder. How would stakeholders perceive your proposal or offer and why would it be important to them? How does it help them achieve their goals and why will it benefit them? What roles can they play and how can they contribute? Next, it is important to identify points of resistance that can be turned into opportunities to create a stronger value proposition. What are stakeholder’s competing goals, priorities and practices? Are there barriers that may create tension? Which trade-offs can be made that result in a better, shared solution. Finally, craft personalised invitations to engage each stakeholder in a process of value cocreation. This requires careful attention to message strategy and use of influencing techniques to generate the right response. Cocreating value propositions with stakeholders is an ongoing process that requires constant monitoring to ensure it remains relevant. Gone are the days of generic value propositions! #strategy #valueproposition #cocreation

Anthony Davidson July 7, 2022

Advertising

Emotional advertising

In 2014, Ogilvy and Maher created this classic “Unsung Hero” ad for insurance company Thai Life. It shows a young man performing random acts of kindness including donating money when others disapprove. In Asia, “tearjerker” ads are widely used because people are more likely to share them widely on socials – rather than just tag friends or groups. By appealing to basic human emotions, people also view the ads as a good cause and worth promoting. While emotional appeals are effective in gaining attention, consumers can often miss the connection to the brand depending on the creative execution. In the Unsung Hero ad, a “slice of life” execution is used to create a powerful story that draws us into the life of a young man who ends up helping a little girl who is living on the street to achieve an education. The idea behind the story is to “believe in good” and to make that association with the Thai Life insurance brand. But are thoughts and feelings toward the ad actually transferred to the brand? And do these thoughts and feelings create preference for the brand? Or is it just more entertainment to share? #marketing #advertising #branding #kindness

Anthony Davidson June 30, 2022

Consumer Behaviour

Shrinkflation

Shrinkflation is back! A recent article showed examples of grocery items that have shrunk in size while their price remained the same or increased slightly. The question is whether consumers have been informed of these changes. Package downsizing is a common way to keep prices down in an inflationary environment where consumers facing cost of living pressures. It works on the idea that changes in package size will not be immediately obvious to consumers. So the unchanged price does not alert consumers to the higher unit price. In marketing, this phenomenon is called the “just noticeable difference.” These days marketers have an ethical obligation to inform consumers of changes in package or price. In the grocery sector, supermarkets and online retailers must comply with the Unit Pricing Code if they sell certain food-based grocery items. Unit pricing enables consumers to quickly compare products of different sizes and brands in order to work out which one offers the best value. But how do customers know that the package size has actually been reduced if it is no longer available? An ethical dilemma! #marketing #consumerbehaviour #shrinkflation

Anthony Davidson June 23, 2022

Governance

Getting governance right

A key challenge facing business owners is making the transition to a more effective governance structure to enable and support growth. Many businesses are set up without an adequate governance or risk management process. But as your business grows, so does your potential liability. A recent review of governance requirements for a client highlighted just how easy it is for owners to not fully appreciate their responsibilities as directors, and how important it is to understand and separate your roles as a shareholder, director and manager. For growing businesses, this separation of roles is often seen as overkill. However, the reality is that separation of roles is a key driver of business success because it enables Boards to focus on strategy, governance and risk, rather than getting caught up in operational matters. And it enables management to focus on what they best – execution and delivery. While this may seem like commonsense, the transition to creating an effective Board and management team can take time. The first challenge is typically deciding who should be on the Board. It’s natural for shareholders who are active in the business to nominate themselves as a director because it reinforces a sense of ownership and control over the business. Often this is not in the best interests of the shareholder, business or the Board if that person lacks the prerequisite skills. A better decision may be to nominate a proxy who has specialist skills needed by the Board. The second challenge is deciding whether to appoint an external chair or independent directors. The current trend is to leverage external expertise where possible to give the business fresh perspectives, new insights and better-informed decisions. This can be problematic for business owners and managers who have been used to running the business their way. But if the goal is to increase the value of the business values, it should be viewed as an opportunity. An alternative is to consider the merits of an advisory board. A final challenge (although there are others) is to create an effective working relationship between the Board and management team. Again, choosing the right management team and the right person who can lead this team is critical. The CEO/GM needs to have the full support of the Board to lead the business and execute the plan. And the relationship between the Chair and the CEO/GM will ultimately determine whether this happens. The problem is that many business owners are still active in the business in management and operational roles. In fact, the CEO/GM is often a business owner. Should you hold a Board position and be the CEO/GM, or on the management team? Although it happens, it can lead to role confusion, conflict of interest, and ineffective functioning of the management team and Board. So avoid it. The goal is to separate shareholder, Board and operational roles. #governance #externalchair #advisoryboard

Anthony Davidson June 16, 2022

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