This week’s guest on Talk Business With Howard radio is Kathy Steele, co-founder of Desert Rose Design, a digital marketing firm in Chicago, IL. I recently was having a discussion with Kathy about LinkedIn and found her business marketing knowledge to be informative, interesting, valuable – and on target. Thank you, Kathy, for writing this guest Q&A blog post as a preview of our conversation on Wednesday, April 11 at 11 AM/ET on Blog Talk Radio. We will be talking about manufacturers’ marketing needs in a digital marketing age.
-Howard –
The Problem
Q: Why has manufacturing become a big part of your business? Why are manufacturers engaging in marketing?
A: Manufacturers have ridden a bumpy ride for the past 10-15 years. There were lots of opportunities to outsource to lower-cost regions. The manufacturer sector felt the outsourcing the fastest, and most significantly. They’ve mostly been in survival mode.
Countries like China and Mexico have been taking business away from US manufacturers because they were able to manufacture goods at a lower cost. But this is no longer the case, as US manufacturing has started to rise.
According to an ABC News article, manufacturing costs in China are increasing, making them more comparable to manufacturing in the US. Because of this, manufacturing business in the US has increased over the last few months, allowing manufacturers to let everyone know they survived.
Q: Why do you think the manufacturing industry has been slow to embrace a marketing facelift?
A: The main reason the manufacturing industry has been slow to embrace a marketing facelift is because it’s a new experience for them. These companies have never marketed themselves before – they never had a marketing plan before. So this fear of the unknown was keeping them from taking a marketing initiative.
Another factor is that most manufacturing companies have been run by the same CEO or same family for decades, and these individuals have been comfortable with their efforts. Unfortunately, many of these company heads will soon be ready to retire, and a new, younger generation will be taking over. Since today’s younger generation is more accustomed to technology and real-time results, it will be hard for them to step into the shoes of more archaic marketing.
Q: What are some of the preconceived notions about the way business is done, that is holding back manufacturers from evolving?
A: Sometimes, tried and true isn’t the path to success, but rather the winding road to a plateauing business. Marketing has been forever changed, and it’s beginning to affect businesses that formerly could function without marketing, either by word-of-mouth or B2B referrals. Many manufacturers are realizing that their 30-year-old logo and similarly outdated marketing collateral aren’t bringing in the deals like they use to.
Who’s Doing It Right
Q: As more purchasing agents and decision-makers look for manufacturing equipment, services and resources on the web, how can these businesses be part of the vendor selection process? How can they extend their offerings by being a resource of expertise, build brand loyalty, and showcase their culture and beliefs?
A: Let me give you an example. We’ve been completely WOWED by Molex. Molex is a global supplier of interconnet products with a portfolio that includes everything from electronic, electrical and fiber optic interconnects to switches and application tooling. They have created a blog that acts as their social media hub, cleverly called “Connector“. They leverage the experiences of their seasoned team to author a variety of industry-related topics, such as renewable energy, automotive and industrial automation. The blog ties together all of their social media channels, including YouTube, Facebook and Twitter. Their YouTube channel features 100 videos highlighting expertise, industry partnerships and events. They do an excellent job of providing resources for their constituents, but the only thing missing – according to my outside perspective – is engagement.
Caterpillar is another great example. They have a very detailed and user-friendly website that allows their customers to locate products. They also have a Facebook page, and they are very active on this site. They post pictures of new equipments, they discuss their non-profit work and they have over 60,000 followers.
Q: Have you seen any success stories of a manufacturer executing a business succession plan and handing the reins over to update their marketing strategy?
A: We’re pretty much in awe of Jim Carr, who took over CARR Machine and Tool in 2004. He realized that it was time to update his father’s former business, not only to make it his own, but to make it viable with 21st century challenges. He knew, after an almost ten-year transition and decades of working at CARR Machine and Tool (starting as a delivery boy in his teens and working his way up), that it wouldn’t be easy. Manufacturing is one of the last industries to react to the revolutionary ideas in marketing and social media, yet companies who embrace it may have the most to gain. When Jim rebranded with a new logo and website, he viewed social media as an awesome opportunity to reinforce and communicate his new brand positioning and for his customers to keep CARR Machine and Tool top-of-mind.
Q: Are there any “Old School” marketing tactics that are still relevant today?
A: Absolutely! We’re not saying, “out with the old, in with the new” – we’re saying to embrace it ALL to reach your customers at the right place, at the right time, with the right message. This rings true for old school tactics. For example, we recently relaunced a website for Miller Industrial. Rather than sticking to digital marketing tactics, we went “old school” and threw a party.
Print advertising and direct mail pieces, as well as TV and radio advertising, can still generate a great deal of interest when done correctly.
Q: As a CEO, how can I possibly divide my time even further with trivial social media platforms?
A: Some companies need a CEO to be involved with their social media efforts while others can rely on employee engagement or the use of an outside agency. In order to decide which is best for your company, you need to create a plan. This plan would need to identify certain goals, including who you are targeting, what social platforms are your clients using, should you use internal or external resources to market, how can you generate revenue from these efforst and then ensuring that you take the time to evaluate the investment.
According to a Gartner article, email will be replaced by social networks as the main use of communication for 20 percent of business users by 2014. Embrace it and make the best of it. Most of all, make it part of your culture and your company handbook for best practices.
What Needs to Change
Q: What do manufacturers need to do to ensure they attract the talent they need to grow and be successful?
A: We think the hesitation to move forward is based in FEAR. This can be felt across the board in manufacturing, in service organization, B2B and B2C. In our experience, it occurs most often in mid-size organizations that do not have in-house marketing departments and in bigger brands that have not allocated digital or content-driven specialists.
For example, we recently met with a prospective client that lost 40% of their workforce because they didn’t offer the culture and values that their newly acquired Gen Y employees were looking for. Many of these individuals went to competitor companies whose web presence conveyed transparency, accepted resumes on Twitter and demonstrated a culture of progressive thinking and social responsibility.
Q: In these lean-and-mean times, how do you suggest going about allocating a marketing budget?
A: Your marketing budget should align with your sales goals. First, you need to determine who your target audience is and how to best reach them. This will help you decide which mediums to use. It is always best not to put all of your eggs into one basket, so mix up your marketing budget by allowing money for different tactics.
You then should figure out how much a new account financially means to you and how many new accounts you need for it to be profitable in your business.
Finally, you need to decide your marketing goals. Do you want to increase web traffic? Do you want to increase brand awareness? Improve lead generation? Knowing all of this information will help you assess a marketing budget.
Q: What would you say to a manufacturing CEO who fears investing in digital/marketing?
A: Here’s a bit of Tough Love. This is the way of the future, so you have a choice – paralysis by analysis – OR jump in because I promise the water is fine! The bottom line is this: I know you think you are unique and that you get business from referrals and your prospects won’t search for your product on the internet. Well, get over it. We are an instant gratification society, and even if we are seeking referrals, we won’t wait for them and will do our own search. And it’s a MUST in attracting new talent!
Kathy Steele is the co-founder of Desert Rose Design, a digital marketing firm specializing in delivering engaging and effective marketing solutions that span both traditional and emerging disciplines. With nearly 20 years of experience in marketing, she leads a firm dedicated to the creation of smart, integrated strategies that drive revenue, create brand awareness and solve business problems. Desert Rose Design’s client list includes Microsoft, Allstate Arena and OfficeMax.
Note: 04/11/12 – A replay of the show is attached to the top of this page.