TOC Marketing

» Posted on Nov 27, 2009 in Sales and Marketing Management | 0 comments

The best kept secret breakthrough in marketing and business strategy is…

(drum roll)

TOC Marketing.

Or in full: Theory of Constraints Marketing.

Listen. If business growth is important to you, this may be your greatest discovery for 2010. Let me explain:

Marketers are misunderstood.

And it’s their own fault.

We often think that marketing is about promotion. I.e. sales and advertising.

But marketing has far more to do with business strategy (company positioning, target market selection, product/service innovation) than promotional campaigns.

Eli Goldratt, developer of the Theory of Constraints methodology, essentially put it like this:

• If selling were the same as shooting sitting ducks while they ate corn by the side of a lake…
• Then advertising would be spreading the corn for the ducks to see and come to eat, whilst…
• Marketing would be figuring out how much corn is needed, the best places to lay the corn, and what grade of corn to use.

“How do we figure out what solution to offer our prospective customers?

That’s what TOC marketing is all about”

- From the article: E.li-vating The Market Constraint by Tony Rizzo http://applyingcommonsense.com/TOCmrktg.pdf

The TOC Marketing Strategy begins by recording how your target audience ‘bitches and moans’ about their situation.

By identifying their ‘undesirable effects’. That is, the negative results of underlying difficulties, frustrations, or hinderances that they have — the problem that your product can alleviate.

By identifying those various ‘undesirable effects’, the aim of marketing is to identify underlying causes of those negatives, and then build a value proposition that removes those underlying causes, competitively, and profitably.

Look, it’s simple. Here’s a quick example:

The Headache

[private_free]Jane has a splitting headache. She pops some big pharma pills and the pains subside. Only to return the next day — whilst those pills actually cause other symptoms, other ‘undesirable effects’, such as irritability, nausea, rashes, etc.

The natural health practitioner on the other hand looks for the underlying causes of the headache. Not just to treat the symptoms. Could it be stress? Lack of sleep? Dehydration? Environmental conditions such as temperature or air drafts.

Once the likely underlying causes are discovered, the likely solutions can be fast and efficient, with long-term effectiveness.

Let’s bring this back to marketing.

The Market

TOC Marketing begins with the customer… as all marketing should… yet rarely does due to the misconception of marketing being largely synonymous with promotional advertising and campaign management.

Some underlying causes of that may include:

• Marketers being more familiar with promotional advertising than strategic level business disciplines such as brand positioning, customer insight, and long-term shareholder value.
• The ‘silo’ mentality of management teams where ‘marketing’ is seen as separate to Client Services, Finance, or Infrastructure, thus creating difficulty in establishing genuine cross-functional buy-in.
• The short-term / maximum utilisation attitude usually driven by a cost-accounting (as opposed to through-put accounting) minded CEO.
• Having sufficient marketing resource to be able to stay in the race (short-term gains through sustained, measurable and demonstrably worthwhile promotional activity whilst also developing the strategy through market research and new service development.

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My ongoing interest is the integration of sound project management, with genuine marketing (both strategic direction and tactical implementation), through the Theory of Constraints methodologies — TOC Marketing.

Companies must now uncover the key constraints – the true bottleneck – within the field of marketing, to help smooth out the difficult balancing act faced by business…

…of trying to act both effectively for long-term growth and efficiently for short-term value.

Join the debate inside the Linkedin TOC Marketing Group.

Explore further...

1. Goldratt Video | Treasure Trove of Theory of Constraints Video’s TOC.tv (http://www.toc.tv) provides dozens of Theory of Constraints videos including...
2. Viable Vision: Transforming Total Sales into Net Profits Notes from the awesome stragetic management book called Viable Vision...
3. Process and Constraints Management “If you can’t describe what you are doing as a...

Tags: business strategy company, eli goldratt, mafia marketing, mafia offer, mafia offer marketing, strategic marketing, target audience, target market selection, theory of constraints, toc marketing, tony rizzo