Product marketing is one of product management’s primary functions along with market intimacy development, product strategy, and product lifecycle management. See the figure below.
But what is marketing? According to Investopedia, “Marketing refers to activities a company undertakes to promote the buying or selling of a product or service. Marketing includes advertising, selling, and delivering products to consumers or other businesses.”
Merriam Webster’s take goes like this, “Marketing is the process or technique of promoting, selling, and distributing a product or service.”
General-purpose marketing definitions like these are not particularly helpful to you as a capital equipment product manager. Both definitions emphasize distribution and advertising. While these are part of the marketing mix, they do not deserve the lion’s share of a capital equipment product manager’s attention. Both definitions also include “selling” as part of “marketing.” This is only appropriate for markets where transactions are so inconsequential that they occur without a salesperson such as with on-line sales. This is not the case for most capital equipment markets where marketing and selling are distinct processes.
Capital equipment marketing falls under the umbrella of a discipline referred to as “industrial marketing.” This is broadly described as the marketing of goods and services from one business to another. In industrial markets, businesses purchase goods or services in anticipation of using them to generate profit. This is much different from consumer markets, where goods and services are merely consumed. Capital equipment marketing is a specific category of industrial marketing. It is distinguished by its large transaction sizes, complex buying processes, and the significance of the buying decision on the profitability of the buyer’s enterprise. It is the nature of the buyer, rather than the nature of the product, that distinguishes capital equipment marketing from other disciplines.
Capital equipment buyers
- Seek to improve profit by investing in capital equipment,
- Are relatively few as compared to consumer and many other industrial markets,
- Are organizations in which many people work in teams to evaluate, purchase, and implement capital equipment, and
- Are often making a decision that can have a significant effect on the success of the buying enterprise.
The nature of capital equipment buyers leads to a sales process characterized by
- The requirement to substantiate the equipment’s value proposition (i.e. the ability to generate profit for the buyer) before the purchase is made,
- One-to-one selling with short, often direct distribution channels,
- Long sales cycles that can take months or more, and
- Multiple stakeholders participating in the purchasing decision.
The primary objective of your marketing efforts is to enable a sales process with the characteristics described above. The product marketing process that can accomplish that objective follows these three steps:
- Determine the product’s master value proposition for each target market and how to communicate it.
- Create the capability to substantiate that value proposition through the sales cycle.
- Deploy that capability with training to the sales force.
That leads to the following definition of capital equipment product marketing.
Capital equipment product marketing is the process that creates and deploys the capability to substantiate a product’s value proposition in a sales cycle.
Marketing is Not Selling
Product marketing defines the target market segment and the product’s master value proposition, positioning, and price. It then creates and deploys the capability to substantiate the value proposition, competitive positioning, and price to the sales team.
Marketing activities include
- Developing standard sales presentations,
- Validating selling tool effectiveness before releasing to the sales team,
- Creating a sales materials library,
- Generating data to substantiate equipment performance claims,
- Building value models,
- Creating equipment configuration tools,
- Creating pricing tools,
- Conducting and publishing competitive analysis,
- Establishing equipment demonstration capability,
- Training the sales team,
- Documenting product specifications,
- Building and deploying content marketing campaigns,
- Preparing to introduce new products to the market,
- And similar activities.
Sales, on the other hand, tailor the master value propositions, positioning, and price to individual prospects’ situation and execute the sales cycle. Sales activities include
- Defining and executing strategies to win individual orders,
- Advancing prospects through the sales cycle,
- Determining a prospect’s buying decision drivers
- Identifying all the participants in the buying decision,
- Determining the competitive situation for individual sales opportunities,
- Tailoring master value propositions to specific sales situations,
- Customizing standard sales materials for specific prospects,
- Negotiating specifications, terms, and price,
- Making sales presentations,
- Responding to prospects’ requests for information,
- Developing proposals,
- And similar activities.
Beware of the Sales-Support Treadmill
As a product manager, if you are parachuted in to make a sales presentation to a prospect, know that what you are doing is not marketing. You are a marketing guy executing part of the selling process. If your efforts are consumed with one-prospect-at-a-time, sales execution support, you may be stuck on the sales-support treadmill.
If asked why you are not spending more time on real product marketing work, you might be inclined to say, “I don’t have time because I’m always doing sales support.” But you must consider the likelihood that it is the other way around. You may be consumed with sales support because you have not done the real marketing work. Signs that this is the root cause of your sales-support treadmill problem include:
- Nearly all your customer visits are for tactical sales-execution support.
- Routine specification responses require your help before they can be completed.
- Every product presentation is a custom creation for a specific customer.
- The best presentations are on your hard drive.
- Salespeople constantly call you with questions about the standard product.
- You cannot remember the last time you conducted a formal sales training session.
When the capability to substantiate your value proposition has not been deployed, a salesperson will always drag in the product expert to directly support the selling effort. He has no choice.
Now imagine if
- Your sales materials articulated a compelling value proposition with multiple levels of material, data, and case studies to prove it,
- Your sales materials addressed all the key questions, objections, and issues that prospects are likely to raise in the sales process,
- Your product specification answered 90 percent of line items in a prospect’s request for a proposal,
- Access to those sales presentations and support materials were easy for the salesperson,
- You had a turn-key, demo process in place that confirms your value proposition, and
- You had a robust and continual sales training program.
If the above were true for your product line, you can bet that the level of tactical support the sales team required from you would fall dramatically. To step off the sales-support treadmill, you must get your marketing infrastructure in place.
If you have determined that you are stuck on the treadmill, do not reach for that emergency, stop button. You have made yourself a critical part of the order-closing machine. If you stop supporting sales cold turkey, orders could come to a grinding halt. Fixing this situation will require you to make a gradual shift from sales support to true marketing. To do this, follow these three steps:
- Determine which sales-support activity is creating the biggest demand on your time.
- Define and execute a project to fix it.
- Go back to number 1.
These projects might include developing specification documents, presentations, data sets, value models, training programs, and quoting tools. Include anything that would enable the sales force to get the support that they need without pulling product experts directly into the process. At first, you will struggle to find the time to work on these structural improvements. But each time you go through the three steps, you will gradually reduce your time on the sales-support treadmill and thereby create more time to develop and deploy capability that enables others to sell more effectively.
Since the “urgent” tends to overwhelm the “important,” you will benefit from a management and control system that ensures that you are steadily weaning yourself off the sales-support treadmill. For example, if you had a routine of quarterly sales training events, you could use these events as deadlines for each incremental improvement in your marketing infrastructure. You could then build a continuous improvement process around this deadline like the one shown in the figure below.
Outstanding capital equipment product managers are hard to find. They are a rare combination of a product expert, strategist, leader, and communicator. Your company needs as much leverage as possible from their talents. There is no denying that directly applying the company’s premier product expert to a sales opportunity will help that one situation. But if every order requires that the product manager touches each sales-cycle step, your company’s total sales will be limited by that product manager’s bandwidth. It is not a scalable model. You will get much more leverage when product managers are creating and deploying the marketing infrastructure that will substantiate your product’s value and enable sales across the entire market.