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Marketing Penetration

How to effectively reach your target audience

Published in Hebrew in Status - Management Thinking Magazine, June 2003 (issue 142)
By Ari Manor, CEO, ZOOZ

If you were ever interested in marketing, chances are you've heard the rule of "focusing on the client’s needs and not on the attributes of the product". This is certainly an important rule in many cases (for instance - to ensure effective advertising), and when penetrating a new market it must be applied sevenfold. While the importance of applying this rule exists, it is not always clear (as often happens with rule-of-thumb type advice) how to implement it in practice, with an actual product in a real market. The following article describes how one can focus on client needs for the purpose of new market penetration, and includes true examples from various fields. I hope you will find this article useful.
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A. Manhattan, New York, 1993

Another phone call resulted in a dead-end. Limor, our saleswoman, is desperate. How can she set up meetings with restaurant owners when they are never in the restaurant, and when the shift manager claims that the catalog we are about to publish will never interest them?

It is the early 1990's. The economic boom of the 80's is long gone. Wall Street activity has decreased drastically. Real estate prices have already dropped and an era of prosperity has come to an end. Restaurant owners, which were among the greatest beneficiaries of the celebration of the past decade, and which enjoyed large turnovers and spend thrifty customers, need to adjust to the new reality.

Most have cut costs and lowered prices. Some did not survive and were forced to close down. Others grinded their teeth and carried on, hoping for better days.

How on earth could we convince restaurant owners to meet us? We want them to join our delivery catalog. In fact, my partner and I are about to produce and distribute the catalog, called Choices, free of charge. Each restaurant will have its own page with logo, menu, opening hours, delivery area and phone number. A client calling this number will be directed to the restaurant's phone through a computerized system, which would charge the restaurant every month for the number of calls passed through. One dollar per call. An average delivery costs 12 dollars or more. This is surely a worthwhile service for restaurant owners in desperate need of extra income. But how can we reach them?

I look at Limor. She is an excellent English speaker, with no trace of a foreign accent and she is convincing and can sell. If she can't do it, then we may never interest restaurant owners in a food delivery catalog. We've already invested a considerable sum in the project. What do we do? Go back to Israel? Suddenly, an idea strikes me. I ponder it for a while and decide to give it a shot. I ask Limor for the phone and call the next restaurant on the list myself.

"Hello. Do you have a catering service?" I ask. "I think so, hold on, I’ll pass you through to the manager", answers the voice.

Limor stares at me wondering, and waits to see what will happen. "Hello, this is Norman", says an older sounding voice, "how may I help you?" "I’m interested in catering services. Are you prepared to deliver it?" "Yes, of course", answers Normann.

"OK, but I’m talking about catering to numerous offices in the vicinity of your restaurant. Can you offer catering of such proportions?" I can almost feel the excitement on the other side of the line. Norman must be remembering the lively eighties and the plentiful orders from firms with long work hours that pampered their employees. "Yes sir, we can offer you excellent quality and our kitchen is ready for orders", answers Norman anxiously.

"OK, sounds good. Can you set up a meeting with the restaurant owners for me?" I ask Norman, trying to sound cool and purposeful. Norman notes our phone number and promises to call back within five minutes. I thank him politely, while inside everything shouts BINGO!.

Apparently, catering is the magic word we were looking for. Limor started using it and by the end of the day we had set up meetings with all the restaurant owners we wanted to meet. We added a catering page to our catalog, offering catering service advice, guidance and tailoring from all of the 70 restaurants that finally appeared in the catalog. When we met the owners, offering them a page in a catering and delivery catalog, only one owner asked for "catering only - no deliveries", and when we said there was no such option, he joined the catalog, including delivery.

About seventy restaurants joined the catalog, including ten McDonald’s branches (most of which did not have a delivery service up until then), two Domino's Pizza branches, and several first-class restaurants. When the catalog came out, only a small portion of the orders were for catering services. Still, when restaurant owners saw their page in the prestigious catalog and received phone orders (which always began with a recorded computerized message saying, "Hello, a client of Choices calling"), no one complained.

B. Stockholm, Sweden, 1994.

It is a sunny lunch-break. I’m sitting in a coffee-shop, biting into a salmon sandwich and watching the people pass by, including handsome tanned blonds - just like the stereotype - enjoying the walk outside in the two short summer months and disappearing, who knows where, during the remaining cold winter months for the rest of the year. I left the office for a short break, since I had to solve an urgent problem. We’re about to publish a subway ad campaign this month that will offer, for the first time ever in Sweden, a psychometric preparation test course.

I watch the Swedes walking on the street, and I have no idea what to advertise on the boards we ordered. First of all, the test is still considered here as measuring innate ability (therefore the common opinion is that one cannot prepare for it at all). Israel used to be the same before the preparation books and courses came out. Secondly, Swedish people are not accustomed to paying for education. In fact, the government allows them to study at university for free, up to the age of 28, in addition to living expenses, which they pay back at an older age at very convenient conditions. To convince a Swedish person to pay $800 for a course, especially one for an exam that "they can’t prepare for", is almost like selling ice to Eskimos...

But the real problem is that Swedes do not trust commercial firms, and do not believe advertisements. The common view here is that business owners wish to deceive you and rob you of your money. The government and government agencies on the other hand, are highly trusted and are viewed as the protectors of individual rights, and guardians of fairness and justice against all greedy businesses. The citizens of Sweden are entitled to free higher education, excellent free health services, and extraordinary social benefits, so it is not surprising that they trust their government. But I have a course to advertise, and advertisements simply don't work here.

I take another look at the street in central Stockholm, in a predominantly business area. It's quite crowded. Everyone's in a hurry for lunch and perhaps even to buy something before returning to the office. It’s obviously not as crowded as a New York during rush hour, but there are still many people in a hurry on the street. Rushing but no pushing, very polite - perfect order.

I look again, and this order reminds me of something. I suddenly realize that Swedes and Germans must have a lot in common. The Swedish people have German roots, and a third of Swedish words come from ancient German. I’m reminded of a scene in a movie I saw several times. "To Be or Not To Be", a comedy by Ernst Lubich, which tells the story of a British spy disguised as Hitler who worked in occupied Poland during WW2. In the scene I remember, the disguised spy orders a group of German soldiers to jump out of a plane flying over the ocean. When they do so with no parachutes, only the spy and pilot (another British spy) remain on board. "Hitler" says to the pilot with admiration, "Those Germans are quite well-disciplined”.

I look at the street again and tell myself "Those Swedes are quite well-disciplined - they believe their government, so let's go along with that. We'll give them a government campaign". I paid the waiter and rushed back to the office.

The campaign was on the subway for two weeks. The advertisement boards were simple. They consisted of a question and an instruction: "Psychometric in October?" and their instruction was "Call this number today". It also carried our HighQ logo.

Out of 10,000 examinees in the October exam in the Stockholm area, 4,000 called us. A typical conversation went like this: - “Hello, when is the exam?” (or “How do I register?”) - “Hello. You have reached HighQ. We are not the National Examination Authority. Their phone number is so and so. Registration date is so and so. Registration forms may be purchased in your local bookshop. You should register by no later than so and so (by now, we have already helped them and created trust). By the way, what preparation course are you taking?” - “Course? Why course? Can you prepare at all?” - “You don't have to take a course. Goodbye sir/madam and glad to be of help.” - “One minute. What is this course - tell me more.” - “OK. The course prepares you for the various sections of the exam: quantitative comparisons, English, graphs and tables...and so on.”

For the first exam we had two full study groups, and for the following exam we opened two new branches in other cities. Our first students improved their marks considerably, as the grade is relative and they had a considerable advantage by being the first in Sweden to prepare for the exam. Some were admitted to the faculties of their dreams, and some even joined HighQ's telemarketing team later (as no one could be more convincing). A competing Swedish firm, (a kind of Open University), which began operating at the same time, registered only half of the amount of students. Our follow-up campaign already included the slogan "HighQ improves your marks", as we became a well known organization in Sweden.

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