As marketers, we’re trained to behave in certain ways, to measure certain outcomes, and to have a certain ecosystem in mind for our products and services. Most marketers can easily reference the four Ps: Product, Price, Place, and Promotion, when they discuss strategy as well as day-to-day tactics. If we sell widgets today, we’re highly likely to sell widgets tomorrow. If a competitor enters the marketplace, they’ll attempt to undercut us in price, find new channels to exploit, deliver a better product, or promote the product in new and interesting ways. In short, we have a tried and true model for how things are supposed to work.
An article about the musician Prince reveals some very interesting lessons that apply across multiple products and multiple product categories. The highlight is the fact Prince arranged to give 3 million copies of his new album away in the U.K. through a distribution deal with The Mail on Sunday newspaper. You read that right. Prince gave away three million copies of his CD. His UK record label subsequently refused to distribute the disc.
What would it mean for you if a partner, competitor, or supplier decided to completely change the economics of your business? Could you withstand the impact of a competitor figuring out how to give away their product for free and make the revenue somewhere else? The Internet was supposed to kill the music business, but it really just changed distribution methods. Prince may have found a way to actually kill the music labels.
Consider the Apple iPhone and how it’s quickly changed the consumer to mobile carrier relationship. The consumer can buy the phone at an AT&T or Apple store, then activate it at home. Anyone who’s ever suffered through a 22 year-old clerk activating their phone knows how empowering it is to be able to control the entire process. Apple cracked open a door that may ultimately change the entire mobile phone ecosystem.
Prince and Steve Jobs were always iconoclastic innovators. Your industry may not have someone similar in it, but that doesn’t mean rules can’t change overnight. Rapidly changing dynamics in every market have created new and potentially game-changing opportunities. You must pay very close attention to every instance of this across the economy. Free CDs today could mean free soft-drinks tomorrow (someone will sell ad space on the cans).
It’s always easy to believe that by mastering the Internet channel, you have your pulse on the changing market. The Internet can be a very effective leading indicator of change to come, and you should keep a close eye on how your product performs and how your competitor uses it. Follow blogs and other social media very carefully and see where the trends are heading. But, don’t lose sight of all the data available offline. Watch the signs across all channels and figure out where opportunities and threats live. Build a scorecard that brings together every reasonable piece of information and run your business based on it.
Prince gave away three million CDs. He got paid for them, plus he’s got concert sales. Apple is remaking the mobile phone market in the same way they remade the portable music player market.
What can you do?
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