Marketing
Issue No. 15 - February/March 2004
Take a Marketing IQ Test
by Dr David Corkindale
Are you trying to make business decisions using some incorrect, pre—conceived beliefs about marketing? Do the people who advise you on marketing know what they are talking about—are they, in fact, using false assumptions or guesses about how customers actually behave or how markets actually work? Can you tell?
Here is a small set of questions that will enable you to find out. Some questions will be familiar and some will cause you to reassess some of your long—held beliefs. That is the Test‘s greatest value.
Knowing the right answers to these questions and questioning other claimed truths could help you to spend your marketing money far more wisely and achieve more in sales and/or profit. Some of the answers will surprise you. They will also give you a basis for comparing the results you get with your marketing with what you could expect. They give you a norm to compare against.
For example, if you raise prices by 4% and sales volume declines by 8% that is actually quite to be expected and you can reassure your colleagues of that, as you‘ll see below. You may try to compensate in other ways for your price increase. If you still lose 8% of volume you know that they were in vain. If you lose only 3% you know that your extra efforts saved you 5% of greater decline.
What’s ‘right’?
What is the basis for claiming that the answers to the Test questions are the ‘right’ ones? Many of the conventional wisdoms in marketing can be traced to one example, often quoted by a guru at a conference or in an article. For all we know, the example was a chance, one—off event.
Such is the case with: “it costs five times as much to win a new client as to keep one." One example in one set of circumstances does not make a universal, reliable, reproducible truth. The only principles worthy of setting down as a reliable guide—and as answers to our test questions—are those that have been found to apply in many examples acro...
