Why is marketing so difficult nowadays?

Why has marketing become difficult?

What changes in marketing are making you feel very uncomfortable now? Anyone who has worked in marketing will definitely have this feeling:

/Users are distracted and it is increasingly difficult to attract their attention

/Media channels and advertising effects are getting worse

/Traffic is becoming increasingly difficult to capture and convert

/Spending money can’t achieve good promotion results

/Spokespersons are not as effective as they used to be

/It is difficult to achieve objective sales even though more and more distribution channels are being built and various promotion methods are being used.

As a result, many entrepreneurs or start-ups have this argument: attention is distracted and marketing costs rise, making marketing difficult.

So is this the truth? Of course not. With a simple analysis, we will find that this argument is somewhat in conflict with another fact: the total marketing cost of society has not increased.

Data shows that the proportion of advertising expenditure to GDP has not increased in recent years

If this is not the case, why do we generally feel that marketing is “getting more and more difficult”?

Before analyzing the reasons, we must first understand two basic types of work, which originate from two classic concepts in strategic studies: "value-capturing" work and "value-creating" work.

The core of the "value-capturing" strategy is to find ways to gain more existing resources.

Reflected in marketing work, it is similar to buying better advertising space , increasing marketing budgets, negotiating better channel prices, finding top spokespersons, extending working hours, purchasing more traffic, etc. The key to doing value-capturing work is not marketing methods, but management methods - such as coordinating resources, contact channels, controlling budgets, and efficient negotiation.

The core of the "value creation" strategy is to create new value by switching the way resources are used.

Reflected in marketing work, it is similar to finding more resonant selling points for your products, finding more participating themes for your activities, exploring and studying the real needs of users, switching product positioning and strategies, etc.

The key to doing value-creating work is not so much management methods (such as budget control and resource cooperation) but marketing methods, such as consumer behavior, motivational psychology, creative conception, and transformational thinking perspectives.

In the past, most of the work done by marketers was actually "value-extracting" work, so you could see many people in the marketing departments of many companies dealing with numbers and tables all day long instead of understanding consumers' motivations and psychology.

The key to value-capturing work is that I can win the battle for existing resources and build barriers . Here are the results worth showing off:

“We signed bigger endorsements.”

"We won the advertising space on CCTV."

“Our delivery volume exceeds that of a certain well-known brand.”

"We have secured more channel resources ."

Last year, there was a popular article titled " Startups are facing life and death every day because they can't afford to buy traffic" which described this phenomenon. The reason why simply buying traffic is becoming increasingly inefficient is because "buying traffic" itself is a simple "value-grabbing" behavior - you have not created differentiation in marketing, and simply want to complete the work through "purchasing". How can it be so easy now?

What many people think of as “marketing becoming more difficult” is actually that the “value-extracting” work they are accustomed to has decreased, and now they need more “value-creating” work.

Nowadays, many marketing managers have taken a course called "Marketing Management" in business school. However, in reality, most marketers only do half of this course: they focus on "management" and neglect "marketing."

PS: The "management" here is management in a broad sense, not the job of senior management. The budget sheets, plan maps, channel negotiations, etc. made by a grassroots marketer are also management behaviors.

Small companies are more likely to do value-creating work

Nowadays, many companies and their leaders are still obsessed with "value-grabbing" work - they are unwilling to spend more energy thinking about how to find value points for their products, not looking for unique entry points that can impress consumers to buy, and even less willing to create unique needs (this is value-creating work). Instead, they spend the most energy on extravagant work, coordinating resources, persuading more "big names" to join, contacting the media, and looking for the highest potential venue...

In fact, what can bring value more effectively now is "value-creating" work.

For example, when it comes to selling flowers, most companies are mainly engaged in "value capture" work, constantly looking for new channels, negotiating with more powerful suppliers, spending more money on advertising, and using negotiation skills to lower prices... In essence, it is a battle for existing stock resources.

But brands like "Take Some Time", which I often use as an example, have rethought "why people need flowers" and redefined flowers as "daily companionship" rather than "occasional gifts" (an ordering model), which is equivalent to creating new value - the original resources (whether they are flower suppliers or advertising space) have been used in a different way.

For example, when I provide consulting services to enterprises, during the entire work process, more than 80% of our energy is focused on transforming corporate leaders and employees to do "value-creating" work. For example, we need to rethink why products are needed by consumers, why employees can achieve results, and why partners can bring the results they promised. Rethink the real value of business operations, product strategy, marketing, and employee work thinking.

Value capture VS value creation - If you compare these two types of work, you will find that although "value capture" work is costly, it is easy to implement : investing 100 million yuan in advertising and then ensuring basic results is very costly, but the work of "completing the delivery" itself is very easy.

The opposite is true for “value-creating” jobs. The actual cost is limited (most of it is intellectual cost), but the work is very difficult - you have to constantly study consumer needs, study how consumers make choices, understand the latest trends, and find unique entry points...

We also conclude from reality that many people actually want to do value-creating work, but because implementers believe that the risks are high and there is no previous data to support it, initiators are likely to be questioned by opponents within the company after failure, and the hidden costs are high!

As for value-extracting work, it is easy to make decisions and pass them within the company with the support of past experience or data. The initiators do not have to bear too much responsibility, and the responsibility for failure can be attributed more to objective reasons! This is also one of the reasons why small companies are more likely to do value-creating work, while large companies do more value-extracting work!

At the same time, large companies with relaxed accountability mechanisms and cultures are more likely to produce value-creating work, while traditional companies with more obvious internal political struggles do more value-extracting work!

In fact, the biggest risk is not to innovate.

Therefore, we feel that marketing has become difficult, essentially because the "value-grabbing" type of work that does not require much thinking is becoming increasingly limited, while value-creating work is not an easy job.

Any past success will have less and less meaning

Is it becoming more difficult to carry out the “value grabbing” behaviors of the past?

So why did this change occur? Why is it becoming increasingly difficult to achieve success through “value capture”?

In fact, it is very simple. We believe that it is the combined effect of a short-term factor and a long-term factor - the short-term factor "reducing dividends" and the long-term factor "the world is flat".

“Diminishing dividends” are easy to understand - when the market is full of opportunities and the entire market is growing, you should quickly seize resources. For example, when Weibo first became popular in 2011, no matter how good your writing was, you could become popular by writing on it quickly. But when the dividends decrease, simply competing for existing resources through "value-extracting" work will reduce efficiency.

Of course, this factor alone cannot cause such a big change. Another important change is that the world is becoming more and more "flat" and the flow of resources is getting faster and faster.

In the past, when resources were flowing slowly, as long as you could quickly seize the beachhead and occupy resources during the bonus period, you could gain a lot of advantages. Then, if you simply rely on these accumulated advantages to "capture value", you will live well.

For example, because of the capital advantages accumulated in the 1980s, you were able to have more sufficient funds in the 1990s (which others did not have), which allowed you to advertise on CCTV (which others could not), and naturally you were able to stay ahead all the way.

However, with the advent of the information age and the emergence of various platforms, one change that cannot be ignored is that the significance of any past success is becoming less and less.

For example, when resource mobility is low, you can continue to create additional value for yourself simply through "value capture" behavior: persuading a very high-quality talent to join your company.

But once we enter the information age and the flow of resources becomes faster, this high-quality talent will soon find that they can play a greater role in other companies, and you will lose this talent - that is, simple "value capture" (persuading talent to join) is no longer effective, and you have to engage in "value creation" (for example, your business model can enable the same talent to play a greater role) .

With the emergence of various financial institutions (such as venture capital and angel funds), the liquidity of capital has increased, and it is becoming increasingly difficult for you to rely on the capital advantages brought by past success to defeat entrepreneurs in seconds.

With the emergence of various consumer product evaluation agencies, searches, purchase reviews, and content displays, consumer mobility has also increased. It is becoming increasingly difficult for you to rely on past brand success to build trust and outperform later, unknown brands.

For example, in recent years there has been a very influential study abroad that has shaken many brand theories. It found that the more popular Yelp (the overseas Dianping) is, the worse the business of chain restaurants becomes, while the business of independent restaurants becomes better.

This is because in the past, consumers lacked information and found it difficult to judge quality (for example, they didn’t know whether an unknown restaurant was good or not and didn’t dare to go in to eat), so they could just judge by well-known brands (KFC is a well-known brand, so it should be correct).

Now, you can just open the reviews and see how many stars they have, which reduces the need to judge quality by brand.

This means that the brand power of “well-known brands” that represent past success will also decline.

In short, the world is becoming "flatter and flatter", and all resources (including capital, consumer choices, talent, channel partners and even user attention) are flowing faster and faster, which means that it is becoming increasingly difficult to achieve sustained success simply through "value grabbing". It is difficult for you to keep a resource in your hands.

On the contrary, it is precisely because resources flow faster and faster that "value creation" has more opportunities.

For example, decades ago, Honda launched the Super Cub motorcycle, which was compact and a disruption to large motorcycles in the American market. When it was first launched, it was difficult to find a channel - motorcycle channels were unwilling to sell such a non-famous brand and low-profit-margin product. (PS: I finally found a channel in a sporting goods store)

Now, various new products that cannot be categorized according to the original shelf logic are constantly emerging, and it is easier to find channels . For example, according to shelf logic, high-end olive oil has to be placed next to low-priced peanut oil, and the contrast effect makes it difficult to sell. Now, it can be classified as “healthy living products” on e-commerce platforms .

Therefore, if the current logic of business success still remains at "you can succeed because you are better than others at competing for existing resources", then it will be difficult to achieve sustained success - the dividends will disappear in the short term, and in the long term "the world will become flat".

Your thinking is limited by some common traps

What is “value-creating” work?

So what exactly is “value-creating” work?

If the core of "value-extracting" work is "resources", then the core of "value-creating" work is "the way resources are connected."

For example, in the operation of a football club, the "value-extracting" work is to recruit more powerful superstars.

The "value-creating" work is to improve the tactical system (change the way stars connect with each other).

PS: Although they will influence each other , for example, the tactical system will naturally change after "recruiting superstars", and the change of the tactical system will naturally lead to some stars being more willing to join. But the core difference is - when you are working, are you thinking about optimizing the tactical system? Or you don’t need to figure out these things and just dig up superstars.

For example, when looking for a spokesperson, the "value-grabbing" behavior is - I found a spokesperson for a big brand, and his fans can bring me users - but in fact, all brands have this effect when looking for this spokesperson, that is to say, the "resource" of the spokesperson does not add value to you, you are purely engaging in a "competition for existing resources."

The behavior of "value creation" means that the same spokesperson can produce more value here than at other places - for example, when AutoNavi hired Lin Chiling as its spokesperson, it directly recorded her voice into navigation, which is equivalent to bringing added value to the same resources.

This idea seems simple, but many people cannot understand and do it in action.

For example, I once met a decorator who wanted to plan a promotion that would go viral on WeChat Moments (that is, he wanted to gain consumer attention). However, we know that decoration is a low-frequency, high-priced, high-decision-making threshold, practical product, and large-scale promotion is often a waste - out of 100 people who see the promotional idea, there may be only 1 who happens to need to decorate their house. (This is not like Durex , which most people need.)

This means that your effective use of consumer attention as a resource is definitely not as good as Durex.

At this point, you will find a magical phenomenon: no matter what industry, the skills required for "value-capturing" jobs are similar (all management); while "value-creating" jobs in different industries each require professional knowledge in the field.

for example:

• Marketing

• Value-extracting work: persuading, purchasing resources, negotiating...
• Value-creating work: finding user needs, switching positions, and finding the “why” that arouses users

• Football field

• Value-extracting work: persuading, purchasing resources, negotiating...
• Value-creating work: Reconstructing tactical systems, etc.

• Company Management

• Value-extracting work: regulations (employees working overtime), purchasing resources (such as better people), negotiations, etc.
• Value-creating work: optimizing work processes, optimizing employment mechanisms, managing human nature, etc.

Conclusion

When you are looking at or judging something, if you are not limited to the thing itself, not limited to the part that your eyes can see, but look at its why, look at what a product and action are for, it will be easier to find more unique ideas.

Many times you are unable to "create value" not because you lack relevant information and knowledge, but because your thinking is limited by some common traps.

Mobile application product promotion service: APP promotion service Qinggua Media advertising

The author of this article @李靖 is compiled and published by (Qinggua Media). Please indicate the author information and source when reprinting!