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why companies must be market-driven

Why Companies Must Be Market-Driven

why companies must be market-driven

So many companies maintain an antiquated mentality and are still driven purely by sales, instead of changing their focus. It’s baffling why sales-driven companies remain as such and maintain their short-term approach when they could be steadily transitioning their organization’s culture into one that embraces being market-driven.

Market-driven companies surpass their rivals by developing superior levels of ability across the areas of Customer Insights / Voice of Customer initiatives to gain keen insights, providing exceptional customer experiences, total customer satisfaction, brand loyalty and advocacy, customer lifetime value.

One sure sign that indicates your company is sales-driven is if the marketing and sales teams can’t stop talking about the latest product or service offerings long enough to listen and learn about their customer’s wants and needs. Sales personnel are constantly in touch with existing and prospective customers – these dialogues should be an excellent source to better understand customers.

Sales-Driven Companies Focus on Short Term

Companies driven by sales tend to focus primarily on acquiring customers, discounting to grab market share, achieving immediate revenues, and controlling costs. They concentrate heavily on increasing short-term ROI which isn’t necessarily bad, since consumers always have needs that must be satisfied, and those needs create opportunities for sellers.

However, over the long-haul organizations driven by sales grapple with differentiating themselves from their competitors in any way other than pricing. While companies who operate in this manner may reduce some short-term risk, these methods don’t help with developing offerings that endure, which makes long-term success an uphill battle.

Market-Driven Helps Understanding Market Dynamics

You’ll see how companies that are genuinely market-driven demonstrate an outlook that’s much more long-term, and they develop superior levels of ability across the areas of Voice of Customer initiatives to gain keen insights, providing exceptional customer experiences, total customer satisfaction, retention and loyalty; brand advocacy, and customer lifetime value.

Engaging customers at a level that enables a clear understanding of their needs presumes if customers are delighted, not only will the revenues escalate, higher profit margins will ensue.

Market-driven companies are externally focused and look outside the company for the input required to develop solid strategies and make tactical decisions. Being market-driven means developing a thorough understanding of market dynamics and consumer needs.

Staying connected to customers and potential customers, and cultivating those important relationships are components of the external focus market-driven companies have that equips them to better anticipate market changes.

Maintaining very close links to customers – and therefore to the market, the insight gained by companies that are market-driven provides competitive advantages that greatly improve their ability to continually offer real value to customers – and having their offerings more readily adopted by the market.

Adapting to Become Market-Driven

If your organization is not completely customer-centric, sweeping change isn’t going to happen overnight. It’s completely unrealistic to expect a sales-driven or internally focused organization to suddenly have close ties to the market.

It would be like taking the rhythm guitarist from a famous rock band and expecting them to play the saxophone at next week’s stadium concert just because they’re a virtuoso musician.  It simply isn’t going to happen without reconditioning.

Rethinking the whole organization and developing new competencies takes time. Executives talk about their companies becoming marketing-driven, but having the wherewithal to effectively make such a comprehensive transformation throughout the organization is a different story.

Successfully implementing and carrying out this strategy hinges on whether this mindset becomes central to the company’s composition — including the long-term allocation of sufficient capital and human resources — and an exceptional thought-leader to steer the transition.

The strategies they set quite literally mold the company’s identity, drive business performance and champion the customer’s needs. Executives operating at this level shoulder great responsibility and need considerable latitude because their obligation to deliver is paramount.

With this realization, it’s apparent that CEOs along with marketing chiefs exert considerable influence in determining the direction of their organizations.

Rising up to these challenges requires highly-experienced marketing executives and the support of CEOs who willingly embrace their Chief Marketing Officers as strategic allies — and recognize the wide-ranging issues that focus directly on delighted customers are key components that are vital to ensuring the company’s success.

CEOs who don’t openly champion the initiatives driven by their senior marketers to continuously instill the concepts of compulsively delivering value to customers put the long-term success of their companies in jeopardy.

Copyright © 2020 Stephen Monaco  All rights reserved.