Strategic Marketing Techniques For Modern Engineering Practice
By Brian T.A. Burton, Brian Burton & Associates
Not only are the elements involved in marketing imprecise and uncertain, the professional environment is constantly changing. As a result successful marketing for the modern engineering practice represents a true challenge in planning and execution.
The 1990s have also brought increasingly intense competition in the engineering disciplines, rapidly changing market conditions, and a client base that insists on value for their expenditures. These conditions have also created a need for careful assessment and marketing strategies because "flying by the seat of your pants" is risky business in the true sense of the words.
Strategic marketing which involves the systematic analysis of the strengths and weaknesses of your own firm, your competitors and the market itself enables a firm to develop and implement a plan of action with a much greater probability of success. This means that firms may also be able to concentrate resources on market sectors which have strong growth potential and greater profitability.
The fundamental concepts of economics where products or services are exchanged for mutual advantages, or profit, can be traced back to the beginning of recorded history.
The "market" which is comprised of producers of tangible assets on one side and prospective purchasers of goods and services on the other, has been described in the past as the "hidden hand" which maintains the equilibrium of supply and demand (by ensuring that they automatically match each other by means of the price mechanism). It is also viewed by some as mankind's first "computer," operating as a self-regulating motor mechanism driving the economy and providing control and balance of economic activities.
The practice of marketing, which until quite recently was considered more of an art or acquired skill than a science, involves any activity that accelerates or expedites the movement of goods and services from producer to consumer. Over the last sixty years marketing professionals developed, tested and refined the principles to form the basis of what we now recognize as a science and a professional specialty.
This scientific approach to marketing involves the study of behavioral, social and survey sciences, psychographics, economics, statistics, cognitive dissonance in the fields of communication and many other sophisticated concepts.
Marketing science, with its emphasis on the probabilities of social and behavioral science, is in many respects the total opposite of the physical sciences. It is also quite different than the practice of engineering with its long tradition of reliance on mathematical techniques and the immutability of the laws of physics.
For many centuries there was unwavering faith in word-of-mouth advertising, coupled with the belief that marketing would take care of itself if the product was good enough. Thomas Edison, for example, confidently predicted in 1922 that, if one invented a better mousetrap, the world would immediately "beat a path to your doorstep." This statement demonstrates the long-standing assumption that the public will somehow find out quickly that a better mousetrap exists and the location of the nearest retail outlet.
There is a remarkable shortage of written documentation regarding the early attempts at systematic marketing, however, conventional theory suggests that it was linked to the growth of consumerism which followed the industrial revolution. Although the exact date is impossible to pinpoint, the creation of the instruments of commerce, capitalism and international trade combined to create a vigorous and constantly expanding market economy that allowed individual citizens to accumulate wealth.
In the early 50s the study and practice of marketing began to gain acceptance as a science which involved understanding, predicting and influencing human behavior with reasonable accuracy. As the body of knowledge relating to psychology, survey science and consumerism expanded, the technology involved in mass communications evolved. Techniques used to influence purchasing decisions became more efficient. Technology also improved various media such as radio and television and computers were quickly exploited as potential tools in reaching consumers.
Modern Marketing Concepts
There is one universal premise which is applicable to all marketing, although the nature of products or services might differ widely. This is termed the modern marketing concept which holds that the primary aim of a company is to accurately determine and evaluate the needs of a target market and then (and only then) adapt or modify its products or services to satisfy these needs. (The key of course is to complete this task more effectively than the competition.) The currently accepted marketing model generally recommends an eight-step procedure as follows:
1. Examine client
requirements in the market.
A voluntary guideline which was developed by a committee of engineers and approved by Professional Engineers of Ontario Council provides an example (for discussion purposes) regarding the attributes that a prospective client may seek in an engineering firm. The criteria listed are followed by practical suggestions on how a firm might demonstrate their capabilities:
The firm has the
technical competence and proven performance to complete the project properly.
(Demonstrate experience and competence on similar projects by maintaining
up-to-date project files);
The true challenge lies in effectively communicating a firm's competence and diligence to its target market, ensuring that promotional materials and personnel stress favorable attributes while minimizing those that may be perceived as negative. A small firm, for example, may stress the importance of customized individual service while a large firm could highlight the extent of resources and geographical diversity.
Deficiencies in the marketing functions can include failure to adequately define corporate goals; inadequate communication; lack of guidelines; failure to adapt to unexpected needs or difficulties; improper identification of potential clients' true needs and, finally, detect sources of resistance at the corporate and/or individual levels.
In many cases, the quickest method to identify and rectify marketing function deficiencies is to commission a marketing audit which involves an independent third-party examination of the entire marketing function. The audit would cover objectives, implementation and organization for the purpose of elevating effectiveness and specifying corrective action, if required.
Historically, marketing audits were commissioned primarily by companies that had reached a desperate position either because of deteriorating markets, or ineffectual policies. In my opinion, marketing audits should be undertaken on a regular basis.
The first step in a marketing audit is to determine if the company's marketing objectives have been clearly identified and communicated to principals, associates and staff. Many engineering firms have never bothered to make objectives more specific than "to achieve a high sales volume" or "to make a high profit on sales." Different executives may also hold different views of the company's marketing objectives. One of the main benefits of the audit is its exposure of such situations and the consequent confusion in the realm of operating policy.
Typically, the auditor would consider the following questions:
· Does the firm
have a Strategic Marketing Plan? Is it evaluated on an on-going basis?
If a firm is shown to be deficient, or there is room for improvement, the auditor will recommend remedial actions to improve marketing efficiencies and performance.
STRATEGIES FOR SUCCESS
If your firm does not have a Strategic Plan, or needs to revamp its image, policies or market focus, here are some possible steps:
1. Have a brainstorming session focussed entirely on strategic marketing. The session should focus on four distinct topics and tasks utilizing four separate worksheets as follows:
- Divide your client
base into market segments by types of projects and clients, services provided
and geographic location.
2. After brainstorming, discussion and rating your priorities, set your goals to ensure the Strategic Plan has direction and specific objectives in the various market sectors for the next year and three to five years. The plan should take advantage of your strengths and correct or compensate for any perceived weaknesses. In some cases, for example, in a market segment which has low profitability, intense competition and minimal growth potential, a firm may decide to withdraw from the market. In other instances, a market segment with high profitability and growth potential and no competition may become a top priority.
3. Implementation of ideas or methods to achieve your specific goals and objectives may include some of the following
- Surveying existing
clients, to determine how service can be improved.
4. Develop action plans for management and staff which are very specific in assigning responsibility for a task(s), time frames, deadlines, budgets, expected results and monitoring and evaluation methods. All time lines must be specified in the action plan as well as budget allowances.
5. Monitor the plan on an on-going basis to determine if the goals are being reached within time, staffing and budget constraints. If you did reach your objective, evaluate the methods used in order of effectiveness. If you did not reach your goal, re-evaluate the action plan and make revisions.
A strategic marketing plan is similar in this respect to a military campaign. Most of history's famous generals learned that victory in battle requires a thorough analysis of the terrain, available resources and the enemy - before the call to arms. Effective marketing for modern engineering practice requires a similar well-researched and planned approach. Success in these matters often hinges on the close examination of every minute detail. Casual or unplanned marketing on the other hand wastes resources and reduces efficiency.
The success of strategic marketing programs for engineering practices is highly dependent on accurate assessment of internal corporate resources in combination with evaluation and measurement of market segments and expectations.
Past experience has clearly demonstrated that the most important factors affecting the eventual success of strategic marketing programs are sincere commitment on the part of senior staff, setting clear reachable targets and ensuring that the firm's resources match their sales and marketing goals.
Brian Burton is a marketing consultant and Member of the Standing Committee for Technical Evaluations for the Canadian Construction Materials Commission (CCMC). He can be contacted by telephone at 905-855-7881, or by e-mail, [email protected].