The main role of marketing is to build mental availability, i.e. to ensure that we are remembered by customers when they are prepared to buy and that they see the real value in what we offer. This is extra important when today’s mantra is leads, leads and more leads. Leads are of course needed in order to reach our short-term sales objectives. But if we want to build market leadership over time we need to think broader.
One of the best marketing books written is “How Brands Grow” by Australian professor Byron Sharp at the Ehrenberg Bass Institute. The main conclusion in Sharp’s research is that the most important factor for success is how well-known the brand is, i.e. what Sharp calls mental availability, and how big the brand is, i.e. what market share it has. The research shows that there is a strong correlation between market share and loyalty, but it is market share that increases loyalty, not the other way around.
The basic rule for a brand to grow is therefore to increase mental availability, i.e. to become better known as a possible supplier to more potential customers. This is a much more important for success than believing that you can grow by getting existing customers to become more loyal and thus get a larger share of their purchases.
So the very simple conclusion: If you want your business to grow, you should prioritize increasing market penetration by reaching out to and attracting as many new customers as possible.
Of course, that does not mean you ignore existing customers, but marketing communications should be as broad as possible to reach as many potential new customers as possible. This is certainly not news to many, but according to a study by LinkedIn, the majority of B2B marketers have not yet taken this to heart. As many as 65% of respondents see loyalty as a more important path to growth than attracting new customers.
Do you want to know more about how to win new customers, just reach out to ulf.vanselius@comprend.com