Marketing can be a funny old game on occasions. Marketing people can become obsessive about keeping a close eye on what their competitors are up to – to the point of paranoia. In corporate marketing departments competitor’s products are dissected and analysed, every statement they make is carefully considered and new initiatives are put under the microscope the minute they are announced.
To an extent this is understandable. After all, marketers are meant to know what’s going on and when you operate in an industry, which is as intensely competitive as the UK mortgage market, a little bit of paranoia is perhaps no bad thing.
However, there is an obvious danger with this approach. If you’re not careful, too much concern about what your competitors are up to means that you start to lose sight of what’s really important – what your clients actually want. It can also lead to a situation where you are no longer anticipating market needs and being proactive, but are instead constantly on the back-foot, reacting to events which have already been initiated by your competitors. This can leave you constantly playing a game of catch-up, which is not good news.
Slipstreaming
Having good market intelligence – understanding what your competitors are up to – is an excellent discipline to have, but the results should be used to support marketing decision-making rather than be constantly dictating it. Slipstreaming competitors initiatives can be a useful tactic on occasions but it can never be a permanent state of affairs. If it is allowed to become so, it means your competitors are effectively dictating your marketing plans. Not a great way to run a business, I’m sure you’d agree.
Do keep a healthy watch on your competitors, but don’t become obsessive about it. On the other hand, do let yourself become obsessive about your customers. Their needs are what really matter most and if you are going to develop a marketing paranoia, ensure it is one that is focussed on understanding what is most likely to keep your clients happy.
Take a look at some of the really great marketing moments in history and it’s quite likely they came about not as a result of corporate marketing departments analysing competitor activities in minute detail, but as a result of someone really being in tune with the needs of their customers.
Take, for example, low-cost airlines. Back in the 1970’s, having a holiday in the UK was the norm and Butlin’s ruled supreme. However, the likes of Freddie Laker understood that what the great British public really wanted was two weeks in the sun rather than a fortnight in rainy Skegness, but the high cost of flights was the major problem. Cheap air travel has transformed the holiday market and while Billy Butlin was becoming increasingly paranoid about what Pontin’s were up to, the cheap airlines came along and stole his market.
James Dyson played a similar flanking manoeuvre on the likes of Hoover and Electrolux, and Apple played a similar trick with the launch of its iPod MP3 player.
Distractions
On a similar note, there is also a danger of becoming overly wrapped-up in market gossip. As we all know, the press has a great way of pushing some issues up the agenda, regardless of whether they deserve to be there or not. The consequence can be that companies spend time and effort worrying about issues which should not really be on their radar screens. Or, perhaps a greater sin, they end up missing the real opportunities because they are distracted by the hot gossip that tends to circulate around the industry.
Take, for example, mortgage payment protection insurance (MPPI). If you’ve read an intermediary mortgage publication recently, you can’t have failed to have notice that MPPI has been under the spotlight, particularly products such as single premium payment protection insurance (PPI). The Financial Services Authority (FSA) is clearly having a very close look at this product, which has made many in the industry wary about selling MPPI.
The result is that MPPI sales are falling. But is this justified? No. With the level of consumer debt at an all time high, the sale of payment protection policies should be on the increase, not the decrease. The market’s concern is not about the need for this type of product, but the value for money which some types of policy deliver.
Fine. The obvious answer is don’t sell poor quality policies. There are plenty of good ones to choose from that do represent good value and that do enable cover to be tailored to match clients’ specific needs and circumstances. There’s nothing wrong with payment protection insurance per se, as I’m sure the FSA would agree. Don’t let the gossip in the industry coffee houses distract you from what is really important.
Over-complication
On a final note, I believe marketers are also guilty on occasions of over complicating issues. In order to differentiate products and services, we can tend to make them more complicated than they really need to be in the vain belief that this gives our company’s offering a competitive advantage. At the end of the day, it can simply result in confusing the socks off clients. There is a lot to commend regarding the principle of keeping it simple, as customers seem to appreciate this quality over and above everything else. Financial services are complicated enough as it is. Borrowers don’t need to be confused still further with marketing gimmicks they don’t understand.
