Where Does Advertising Fit Into the Marketing Mix?

Many people get confused about the role of advertising in the marketing mix so here’s a simple view of where it fits in.

In the traditional marketing model, we talk about the 4 P’s

o Product

o Pricing

o Place

o Promotion

The last section – Promotion is what we mean when we say you are “doing your marketing”. It’s your communications or your actual marketing activities.

But first, let’s get clear about the PURPOSE of marketing and why you want to get good at it.

“The PURPOSE of marketing or it’s biggest task is to

persuade prospects to visit you online or offline so you

can present your offer. Done well they come waving their

credit card and ready to buy so there’s no need for hard sell.”

Whenever and wherever you get in front of your potential market is your marketing opportunity – you are communicating or getting your message across.

You could say this started as far back as Babylon when the Town Crier was the only delivery method! They went around town shouting out to people to go to the marketplace and you went to the marketplace with your goods to “present your offer”.

With the invention of print and other technologies you now have a smorgasbord of delivery methods or media to reach people such as

o Print – newspapers, magazines, catalogues, newsletters

o Phone, mail, fax

o Radio & TV,

o Internet – through websites, blogs, social networking sites, email, video & Audio podcasts

o Teleseminars & webinars

o Mobile media – Blackberrys and mobile or cell phones

o And lets not forget in person public speaking and networking

Now that range adds a level of complexity. But choice is good and you don’t have to use all of these but they are available to you.

In any event you’ll either be speaking or writing. Simply narrow down what makes sense for you and your business and use your strengths to work out a plan.

JUST remember the marketing principles remain the same no matter the medium – so the PURPOSE of your marketing is still the same. To persuade prospects to visit you online or offline so you can present your offer.

So where does advertising fit into this?

Advertising is simply a subset of your marketing activities it’s the SALES function when you make the sales pitch or “present your offer”. This could be verbal or written in all the same media you use for your marketing communications. What adds to the confusion is sometimes big companies use image based ads for awareness so the “sales pitch” isn’t obvious.

But the primary purpose of advertising is to SELL.

So you create ads in one form or another and get them in front of your audience.

Small businesses can’t afford to waste money on image advertising that is designed for the masses to promote a well known brand. It simply isn’t designed to sell, NOW.

What I do and recommend is Direct Marketing which is based on one-on-one relationships and uses proven direct response advertising techniques instead of mass advertising.

The purpose of a direct response advertisement is to get a response, NOW! Which means these ads actually ask the prospect to DO something.

Whether you’re building a list, selling a product or service, an appointment or even something you are giving away – you still need to “sell” it to your prospect. And ask them to take the action you want them to take to move them through the sales process.

In a nutshell, advertising is a subset of marketing and direct response marketing and advertising is the champion for small business.

The Definition of Sales – Professional Selling Defined

Before I define professional selling. Let’s look at some of the related professions. Below are some definitions of professions/occupations that relate to professional selling from Wikipedia:

  • Marketing is defined as an ongoing process of planning and executing the marketing mix (Product, Price, Place, Promotion) for products, services or ideas to create exchange between individuals and organizations
  • Advertising is defined as a form of communication that typically attempts to persuade potential customers to purchase or to consume more of a particular brand of product or service.
  • Public relations is defined as the practice of managing the flow of information between an organization and its audiences.
  • Sales Promotions is defined as the pre-determined actions designed to increase consumer demand, stimulate market demand or improve product availability for a limited time (i.e., contests, point of purchase displays, rebates, free travel, and sales incentives.)

What about the sales profession?

Notice in the above definitions, the profession is *not* defined as the individual. For example, marketing isn’t defined as “people who market.” Yet, the sales profession is often explained as “individuals who sell.” Therefore, selling shouldn’t be defined in this manner. Notice also, that the above professions are *not* defined by the activities of those individuals. In other words, the profession of advertising isn’t defined as “placing ads on television.” Therefore, selling shouldn’t be defined in this manner.

Academically, selling is thought of as a part of marketing, however, the two disciplines are completely different. Sales departments often form a separate grouping in a corporate structure, employing individuals who specialize in sale specific roles. While the sales process refers to a systematic process of repetitive and measurable milestones, the definition of the sales “profession” doesn’t exist (until now with this article).

So the questions become:

  • Who is “in” the profession and who is not?
  • How does selling relate to marketing, advertising, promotions, and public relations?
  • What shared competencies do individuals within the sales profession need?
  • How do these competencies align to roles in terms of focus and differentiation?

A definition should provide a meaning. To determine the meaning of the sale profession, it is useful to determine what the sales profession *must* contain.

The following three tenets are required for professional selling:

  • The focus of the sales profession centers on the human agents involved in the exchange between buyer and seller
  • Effective selling requires a systems approach, at minimum involving roles that sell, enable selling, and develop sales capabilities
  • A specific set of sales skills and knowledge are required to facilitate the exchange of value between buyers and sellers

Within these three tenets the following definition of profession selling is offered by the American Society of Training and Development (ASTD):

Professional Selling is:

 “The holistic business system required to effectively develop, manage, enable, and execute a mutually beneficial, interpersonal exchange of goods and/or services for equitable value.”

Note: this definition was published by ASTD in 2009.

What does this definition accomplish?

First, it creates a definition of world class selling. An organization wishing to benchmark its selling effectiveness can leverage the above definition to clearly understand strengths and weaknesses. Without such a definition, most adjustments to the selling team are arbitrary and subjective. By understanding the system’s view required for selling effectiveness, organizations can look at indidual sales team members as well as sales team processes and tools and how they align to the buyer.

Second, it allows for more consistent results in performance through the clear establishment of roles regarding who is “in” and who is “out” of professional selling. For example, if it doesn’t involve a human agent, it is not within the sales profession — it’s a marketing function with a transaction (i.e., a “sale”). For this definition, sales operations, sales recruiters, and sales trainers are “in” the profession because they possess unique skills outside of their regular job titles. They posses knowledge and skill that is unique to enabling the definition.

Third, the definition lays the foundation for sales talent management/people strategies. With such a definition, sales development employees can create learning solutions that fit the unique aspects of a sales culture. At the same time, front-end recruitment strategies and more clearly tie to retention strategies.

Fourth, it helps organization on exemplary performance. By setting a bar with such a definition, organizations don’t have to settle for mediocre sales effectiveness. They can use the definition to help bridge the gap between sales capacity and sales team competency.

What is Sales Financing?

Running a business is a difficult process and one which is constantly fraught with unexpected financial difficulties. Balancing acts are constantly required to ensure there is enough money in the business coffers to cover wages, rent, tax and other regular bills, as well as stock and equipment purchasing.

For all businesses, one of the key factors of success involves ensuring the quick release of funds in order to enable further purchasing or investment decisions. If funds are tied up rather than available for use, then the entire business process can screech to a halt.

One of the most common problems in business usually occurs when large sales are successfully made and the work is invoiced to the client, but payment is not immediately forthcoming. This means that there is a lot of cash tied up in sales ledgers which are not available for use on other projects such as restocking. This is an all too common situation which can prove disastrous to many companies – especially smaller businesses and start-ups who are usually the least able to effectively deal with these types of situations due to generally low levels of liquid assets in the first place.

This has lead to the creation of a number of business and sales financing products by larger institutions and specialist business finance organizations to fill the gap in corporate finance. These days, many banks can provide business banking services such as factoring, invoice discounting, and stock finance to enable their clients to free up many of the assets that they normally have access to for working capital.

Sourcing a financial institution to deal with the recovery of funds tied up with stock or invoices and to help deal with sales ledgers can enhance a business on several fronts. Not only does the company not have to worry about chasing up debtors, but the money is quickly made available for reinvestment; and the risks of suffering from bad debt are significantly lowered, as it can become the province of the factoring company to pursue reticent debtors. Factoring companies will often also make available additional debt recovery litigation services if they should become required.

While some businesses may see the costs of using sales finance services as cutting into profit margins, the benefits of having funds made accessible for use towards working capital – rather than sitting with inaccessible funds which do not for the company – can prove to be invaluable in enabling company growth and stability.

Is Marketing Ethics an Oxymoron?

To many people the answer to this question would be a resounding “YES”. Are marketers really concerned with the welfare of their customers, or are they more concerned about the ‘bottom line’ of the organization they represent? I read of one example of an official in the Swedish office of Coca-Cola who says her goal is to get people to drink Coke for breakfast instead of having orange juice. Is that in the best interest of the consumer?

A change is coming, and has already started, in how consumers and organizations must view the marketing profession; a more ‘holistic’ approach towards consumers is required. In that regards companies must consider all aspects of their relationship with the consumer, not just their own goals.

Many may ask “is there a place for ethics in marketing?” In discussing concerns that consumers and advocacy groups have with the apparent lack of concern for consumers’ well being, we must address the challenges that marketers have to ‘self regulate’ and become more socially responsible. This really is no different than what would be expected of each of us: In an organized society it is the responsibility of all to behave ethically. One concern within the marketing industry is that if marketers do not change their ways, and become more socially responsible, they will become subject to more government controls.

The ethical relationship between marketing and the consumer is a key to the success of organizations. Consumers expect to be treated fairly and with respect. Consumers expect that the service they receive from organizations will be reliable, responsive, trustworthy, understanding, and that they are really receiving something of value. They do not want ‘lip service’, unrealistic promises, or misleading offerings. Consumers do not want to be sold products that are inherently bad for them. The ethical implications for marketers are great in meeting these expectations. As more people join the marketing field, especially in the increasingly popular ‘information marketing’ arena, these issues will, and should be, some of the first issues that need addressed.

A new foundation for marketing and the ethical implications of marketers targeting specific groups or segments of consumers is needed. Companies have targeted specific segments of consumers that they feel will provide them with the greatest returns, sometimes to the exclusions of others. Some consumers feel that marketers do not care at all about what happens to them once they purchase a product and that this caveat emptor, or ‘let the buyer beware’ theory of marketing is, and must, rapidly be dismissed.

Markets must become more concerned with the needs and wants of the consumer, but they must still keep in mind the overall goal of the company. This unfortunately creates a conflict between the priorities of the marketer, the needs and wants of the consumer and the goals of the organization (Profits), and is the basis for much of the confusion and concerns about ethical marketing practices. To overcome the challenges that this presents organizations, and to some extent consumers, all involved must take a more holistic, or all encompassing view of the marketing process. Ethical decision making for businesses will require them to take an “enlightened self interest” approach to serving the consumer, to insure that there marketing practices are ethically sound.

Consumers also must bear some responsibility to become more self aware and informed about the products they purchase and use. For those with the ability to make rational choices, consumers must take actions and research the products they buy; they must develop an awareness of their needs, as opposed to their wants, and make appropriate decisions concerning the directions their consumptions take them. If consumers expect organizations to treat them with respect, and provide a level of service consistent with their needs, they must do their part.

Service is really the art of offering a consumer more than just the product they are purchasing. Part of that offering is to provide consumers with the assurance that what you are marketing to them is based on ethically sound principles: Do organizations treat their customers with respect? Are they honest and forthright in their communications with consumers?

As awareness of consumer rights increases, and advocacy groups increase pressure on organizations and governments, the priority that organizations must place on the ethical implications of their marketing programs will only increase. In the service industry the relationship between the consumer and the service provider is all that matters. If the consumer perceives that they are being treated unethically they will go elsewhere. But, not only will they leave, they will take with them as many others as they can. The risk that organizations face by treating their customers/clients unethically is too great to let this happen.