The Importance of 'Place' and 'Promotion.' (Marketing Management)
Willax, Paul A., American Banker
MY LAST ARTICLE expressed the belief that too many financial institutions are placing too much emphasis on the "price" and "product" elements in the sales and marketing formula for success, and relegating the "promotion" and "place" components to an unwarranted secondary status. Such misdirected prioritization has been accentuated lately because the price and product elements of any business generally are impacted most significantly -- in the short run -- during a period of regulatory decompression. I concluded that piece by exhorting managers to focus more time, attention, energy, and resources on the "promotion" and "place" aspects of their sales and marketing strategies, if they wish to enhance the long-term competitive postures of their organizations.
Given the fervency of my admonition, it would seem wise to devote this article to a definition of "place" and "promomotion" and to an exposition of their importance in the "Four P" formula for success.
"Promotion" refers to artful endeavors designed to convey an inviting image to target consumers. Such promotional activities must be potent enough in their design and execution to incite object consumers to action. Moreover, they should involve other operational functions in the organization in a manner that helps them to elicit favorable customer responses with the kind of service that reinforces the image and, most importantly, with the types of substantive economic utilities and psychological benefits that "bond" the customer to the institution.
In an industry that deals in easily replicated intangibles, and does it in an environment that is complex and confusing, the most unique feature that an institution can develop vis-a-vis its marketplace is its image. A corporate image is, in essence, a one-of-a-kind, personalized perception that actually is built, over time, in the psyche of the object consumer, and reinforced and refined over more time with additional cues and performance rewards that are extended in the process of doing business "as usual" with that customer.
A consumer's perceptions are, admittedly, difficult to create, change, or control, because both the sender and the receiver simultaneously contribute to, and condition, this image-creating process. Also, external "static" frequently causes distortions. An image, as it evolves, is the mirror reflection of the personality of an organization. It is a perception of that institution that is built by the customer with the assistance of the organization. It is his customer-perceived persona, therefore, that will stimulate, stunt, or stymie the interfaces between the organization and its intended customers.
Despite all the technological advances, product development, marketing savvy, and sophisticated systems design that firms can bring to bear on their markets, consumers still rely on their natural instincts. They are, in the final analysis, still people, and they gravitate to, and seek gratification from, other people -- or, at the very least, organizations of people that have a collective personality that appeals to them as satisfaction-seeking customers. The "personal" features of an organization, even if conveyed mechanically through machines or communications media, remain determinative in a customer service relationship.
The challenge for every market-oriented financial services firm is to organize, educate, and motivate a team of customer-oriented people; and to communicate the personality facets of this aggregation to preferred customer segments in a manner that favorably differentiates the organization from its competition and reinforces the customer's image of it with every interface that occurs.
This is "sales" -- the essence of marketing -- and it is this kind of sales approach that should be consuming more of a financial service organization's resources and more of its top management's time and talent.
The other, too-frequently neglected "P" that must be addressed symbolizes "place" -- the point at which needsatisfactions actually are conveyed to the customer -- that special, spatial "moment of truth" at which an institution and its customers actually interface. …