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  • Attila Gursel


All commercial enterprises have one goal in common: To make a profit. No commercial enterprise can continue with their commercial activities without earning more than their expenditures. Of course, companies cannot be expected to be only profit-oriented; they have to include values such as quality, customer satisfaction, on-time delivery and marketing among many of their qualities. However, these qualities are again steps taken towards achieving profit.

Marketing is the most significant department of a company. A company’s top management develops strategies on how to make a profit. The main objective is strategy; marketing is one of the key elements for achieving this strategy. The function of marketing has evolved over time. The function of marketing at the beginning of the 80’s was to create an image for the product, services or for the company. At the beginning of the 90’s, the focus of marketing was on how to maximize the market share. Beginning from the second half of the 90's, the market share didn’t mean much on its own. After all there was an easy way of increasing market share to 100%: selling the product or the service for free. The only goal of marketing today is: to sell more products/services at a higher price and for a higher profit.

Popularity and brand awareness is meaningless if it doesn’t create more sales or increase profit. In contrast some may even argue that “it will definitely be profitable in the long run”. A quote by the famous economist Keynes sums up this situation perfectly; “In the long run we are all dead”. The important thing is to boost sales and to make a profit in the short run. In a nutshell, marketing should be result oriented.

The traditional organizational structure of companies is built on the “silo’ mentality. In other words, it is the method in which departments that have no organic connection with each other work side by side but perform their own duties. The customer is approached by different departments to market the same product in companies where silo mentality is adopted. For example, a customer might be approached by the customer representative, the marketing department and the sales unit of a bank that uses this method to sell credit cards. The goal of a traditional marketing staff who works for a traditionally structured company is to find as many customers as possible for its products or services.

As for the new organizational structure, horizontal organizational structure is preferred over vertical organizational structure (silo). There is cooperation rather than division of labor. The marketing strategy in this new organizational structure, in which departments are aware of each other and are customer oriented instead of product oriented, aims to provide more products and services for the existing customer. In line with this, the main strategy is to create a set of methods that can be applied in order to stand out among competitors.

The main duty of marketing in this case is to communicate the distinctive elements of the service or trademark efficiently to the customer. The goal is to differentiate the product or the service in the eyes of customers from other alternative options and ultimately increase consumption or sell at a higher price. OR BOTH.

The main problem faced by companies is a decline in customer loyalty. This is due to increased competition and lower priced and more attractive product alternatives. As a result, profit margins decrease because the only way to secure the customer is to lower the price. Making a difference to increase profitability is so difficult that it is almost impossible. The only way to increase customer loyalty and to raise profit margins is through one-to-one marketing. One-to-one marketing is actually ‘tailoring to individual needs of each customer’.

What matters is not what you think, but what the customer thinks. To be customer-oriented is to change and develop products and services according to customer needs. Producing different products and services according to each individual customer rather than for the average customer is what is essential in one-to-one marketing. The company should be able to involve customers in this phase. It is necessary to communicate directly with customers in order to accomplish this. You can only make a difference with a marketing strategy built on capturing the benefits and expectations that your competitor does not grasp and explaining such services to the customer and putting them into action.

A company that grasps the idea that the new marketing method is customer-centric rather than product, should first of all address the question; ‘In which direction and manner is my customer evolving?’ Followed by the sub-questions:

- Who are our customers?

- How are our customers’ priorities evolving?

- Who should be our customers?

- How can I add value to my customers?

-How can I become my customers’ first choice?

- What is my profit model, what should it be?

-What is my current business model?

-Does this model fit customers' priorities?

-If not, what should be my business model?

-Who are my real competitors?

-What is my most challenging competitors’ business model?

It's possible to diversify these questions. However, in a strategy (one-to-one marketing) which is based on obtaining and using the maximum amount of information about a customer, the customer, above all, must trust you implicitly.

Customers differ in two ways for businesses; their value for the business is different and their expectations from the business are different. The net present value of the profit made from the customer today and the future profit to be made is the real value. The potential or the potential for growth that your customer can secure you is the strategic value. The total of these two values brings forth “customer share”. The aim should be to increase the customer's "lifetime value".

An analysis of differences should first be implemented. In other words, the answers to the following questions should be found: where are we, where can we be, what is the difference between them, how can we close the gap and what should we do. In short, actions that should be taken in order are:

1. Know yourself (your company)

2. Know your customer

3. Know your competitors

4. Communicate with your customers, determine their expectations and needs

5. Differentiate your service and presentation (business model)

6. Make a profit

#marketing #differentiation #profit

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