Business Up Front - May 2001

Business Up Front

Nine Marketing Myths

According to John R. Graham of Graham Communications, "marketing seems to be shrouded in myths and misconceptions."

Here are nine myths that can thwart successful marketing efforts:  

Marketing can be done on a shoestring. It’s often difficult to understand that marketing is an investment in the future of your company. Nobody expects accounting, manufacturing or selling to be done "on a shoestring." Why is it just marketing that gets the shoestring treatment?

Marketing supports sales efforts. Many business owners see the sales department as their football team, with marketing as the water boy. Actually, it’s marketing’s task to ensure there is a market for the product or service being offered, to identify the customers, create a message and develop a plan to elicit interest. After all that, the sales department can go to work.

Marketing takes too long. Quick fixes to increase sales, such as slashing prices or offering generous incentives, are only temporary solutions. Marketing does take time. However, a carefully crafted and well-executed marketing plan produces positive results over a long period of time.

Marketing is just another word for advertising. The full effect of marketing is achieved by using a variety of promotional and public relations activities. Advertising is only one component of the overall program.

We don’t need research — we know our customers. Times change, and so do customer demands and expectations.

Marketing is just frosting on the cake. Marketing is often ignored when sales are strong, and when sales drop, marketing budgets are cut. A consistent marketing program is fundamental, and can produce a constant flow of business to minimize the "hills and valleys" so many companies face.

Marketing is only for big companies. Companies of any size can benefit from marketing.

Marketing wastes money. Like any other area of expertise, good marketing takes talent, knowledge and experience. People who lack an understanding of marketing basics are the ones who make poor decisions that waste money.

Marketing and sales are the same thing. Marketers are interested in customers, whereas salespeople are interested in orders. After marketing has done its job in achieving visibility, creating interest and differentiating the company or product from its competition, then salespeople can facilitate the order.

Consumers Losing War with Credit Card Debt

An Internet survey by marketing research firm Decision Analyst, Inc. revealed that 42 percent of the 2,087 respondents were "very close" or "somewhat close" to their credit card limits. The survey, conducted in December 2000, showed that 21 percent were "very close" to their credit card limit and another 21 percent were "somewhat close."

"The percentages rose slightly throughout 2000," said Jerry Thomas of Decision Analyst. "With the economy beginning to slow down, it’s likely these percentages will rise rapidly in 2001." Women are more likely than men to be close to their credit card limits (44.7 percent versus 39.7 percent). Older consumers (55 years plus) and higher income consumers ($75,000 per year plus) are least likely to be near their credit line.

Very close to total credit card limit 21.0 %

Somewhat close to total credit card limit 21.2%

Not close to credit card limit 46.5%

Do not have a credit card 11.3%

Total 100%

Quiz for Coffee-holics

The Speciality Coffee Association of America and its Las Vegas representative, F. Gavina & Sons Coffee Roasters, offer the following True/False facts to test your knowledge of the Almighty Bean that allows us all to remain alert while working long, stressful hours:

CFO’s Favor Freedom from Internet Tax

A recent survey of chief financial officers (CFOs) indicates that the majority of businesses would like to continue offering tax-free shopping online. The survey by RHI Management Resources included responses from 1,400 CFOs from a random sample of companies with more than 20 employees. Over half (57 percent) said they favor an extension of the three-year moratorium established in 1998 by the Internet Tax Freedom Act, which expires in October 2001.

CFOs were asked,

"Do you think the three-year moratorium resulting from the 1998 Internet Freedom Act should be extended?"

Yes   57%

No    16%

Don’t know/no answer 27%

Total 100%

The act bars state and local governments from imposing taxes on Internet access. It is also meant to protect online buyers and sellers from situations in which multiple state or discriminatory taxes are levied on e-commerce transactions. Paul McDonald, executive director of RHI Management Resources, said, "If new tariffs are eventually imposed, companies will need to ensure their Web sites and financial systems can handle increasingly complex tax calculations for online business transactions."

Executives as Politicians

In a recent survey, the nation's top business leaders said nearly one day out of each work week is spent dealing with office politics. The survey, developed by OfficeTeam, was conducted by an independent research firm and included responses from 150 executives with the nation's 1,000 largest companies. Respondents were asked, "On average, what percentage of an executive's time is wasted dealing with company politics?" The mean response was 19 percent.

"Executives who spend nearly one-fifth of their work week settling conflicts have less time to devote to more critical aspects of their jobs, such as developing business strategy and implementing new initiatives," said Diane Domeyer, executive director of OfficeTeam. She offered the following suggestions for reducing conflict in the office:

Create an open environment. Office politics are often fueled by insecurity, so try to keep employees well-informed of internal news. Avoid closed-door meetings when possible, as they can give rise to speculation.

Seek integrity. Just one unethical or dishonest worker can generate significant tension. At every opportunity, emphasize to your staff the strong value you place on ethics and honesty.

Eliminate office rivalry. While a certain amount of competition can be healthy, too much is divisive. If workers feel they are judged not by their individual merits but by how they compare with others, the competition level could be counterproductive.

Delegate authority. If a busy schedule is reducing your face-time with staff, select someone on your team who can be more accessible when employees have concerns.

Be alert for burnout. An office filled with overburdened workers is primed for conflict. Staff members who have taken on more than their fair share of work are the first to burn out. Bring in outside help if necessary to ensure that assignments are evenly distributed