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TeleSparks Archive

TeleChoice TeleSparks - Who Needs Marketing?

+=+=+The News+=+=+

With the increasing pressures in the telecommunications space,
we’re seeing interesting trends in budgets, organization 
restructuring, and business priorities. More and more businesses 
are saying: "We don’t need marketing. All I'm focused on is 
selling, and the sales targets are clear."

+=+=+The TeleChoice Take+=+=+

You can be too thin in marketing, and it is important to understand 
what you need and don’t need in a down economy. It can get 
confusing. Clearly "Marketing," "Public Relations," and 
"Advertising" are not the same thing, and yet too many companies 
completely link decisions about the three. A failure to perform 
marketing functions today may doom many companies to failure 
over the next 18 months.

Defining Marketing
The readers of this newsletter know Marketing is a multi-function 
discipline. Functions that organizationally reside within a Marketing 
organization can include Marketing Communications (including 
advertising, product and corporate collateral, Website design, etc.), 
Customer Communications (including newsletters, events, etc.), 
Media and Analyst Relations (press releases, relationship 
management, events, etc.), Pricing Strategy, Market Strategy, 
Market Management (including channel development), Product 
Development, and so on.

Unfortunately, given the realities of cash on hand and burn rates, 
many companies have cut marketing budgets and headcount to 
the bone. As one of our clients put it when asked where he now 
fits in the organization: "Well, I'm not in Engineering, and I'm not in 
Sales, so I must be in Sales Support, because I still have a job."

We’re hearing lots of other scary comments these days, things like 
"We haven't updated our Website in a year and a half," and "Our 
market strategy is all about selling in Asia right now, because no 
one in the U.S. has any money."

In other words, if it doesn't directly support current Sales efforts, 
then it's not getting done.

That works great if you are in a part of the market where there are 
few to no competitors, but here's the problem: although far fewer 
companies are in the market today, everyone is selling to the 
same small group of companies, and we have seen no meaningful 
improvement in competitive clarity.

What do I mean by that? A couple of years ago, so many different 
companies were all competing in the same spaces, we counseled 
our customers to crystallize their messages into crisp and coherent 
positioning and differentiation. In other words, understand how you 
(as a company and as a product/service) are different from 
everybody else out there, take that understanding and use it to 
carefully target your markets and customers, and create crystal 
clear positioning, differentiation, and messaging so all of the RIGHT 
customers will quickly understand why you are absolutely their best 
choice. Secondarily, focus all of your R&D and product development 
into extending the leadership that you have in the dimensions that 
already set you apart and that matter to your target customers.

What's happened is that, as the number of companies has fallen, the 
crispness and clarity have disappeared from the survivors. 
Everybody wants to be all things to all people. I know why this
has happened; I'm not stupid. But it's just another part of the deadly 
short-term thinking that has gripped our industry.

Why has it happened?
Not only are there fewer competitors, but also, as I’m sure you’ve 
noticed, there are fewer customers. And the future of those customers 
is so unpredictable no one can afford to bet on any single one. 
Therefore, we'd better bet on everyone.

Have you ever been to the horse races? It’s a little known fact that if 
you placed a $2 bet on every single horse in every race, you'll win 
every time! Of course, you won't "win" if you consider winning to mean 
leaving the track with more money than you arrived with, but let's not 
argue semantics... (remove tongue from cheek....)

And guess what, betting on every horse in telecom is much, much 
worse than doing it at the racetrack. For starters, just because you 
put your $2 into a bet on the winning horse, typically only one of the 
ticket holders wins...

In fact, selling in telecom is completely unlike horse racing. The 
odds for you on a given horse are completely different from the 
odds for any other vendor selling to that horse. Remember, that's 
part of what marketing is about, but I guess you've already 

Back to Reality
Here's what winners need to do to win in the telecom marketplace. 
Hard reality is that not everyone has what it takes to win, but if you 
fail to execute on the fundamentals, then you will almost be assured 
of losing.

You need to understand what's uniquely good and true about your 

I can hear you even as I write this. I've got it memorized because, 
3 times out of 4 when we're briefed by telecom companies, 
we hear it: "We know what we're all about. We're the world 
leaders in xyz." Unfortunately, even this year, we're likely to 
be briefed by 20 - 50 other companies claiming to be the 
"world leaders in xyz." Why? Because, everyone has 
broadened their definition of who they are and what they're 
great at so they can bet on all the horses...

Why is it so important to understand what's different about your 
company at its very core? Because if you know what you can do 
that nobody else can do, then you will know where you can blow 
away the competition and you will know who is willing to pay for 
that. If you choose to define your opportunity around the things 
you're only as good at as everybody else, then you are creating 
a buyers’ market, and within 18 months there will not be any 
profits for anyone in that space and you will wither and die.

You need to be able to communicate how you're different and 
how that translates into value for your customers.

At least 50% of the companies that brief us fail the "logo test." 
If we can take one of your competitor's logos and put it on your 
presentation or your Website or your sales collateral and hand 
it to someone who is knowledgeable on your space and have 
them believe that the piece is really your competitor’s, then you've 
failed the logo test. 50%!

How does this happen? Think about it. You know what happens at 
your company. Draft 1 of the presentation or piece of collateral or 
whatever gets passed around. Joe comments, "This doesn't 
mention that we're scalable. Our biggest competitor keeps talking 
about how scalable their solution is. We've got to say we're 
scalable." Draft 2 emphasizes that your solution is scalable. Jan 
pipes in, "This doesn't mention we have great network 
management software. I just heard from our biggest customer 
that they really love our network management software." And 
on and on... In the end, the piece is dominated by "me too" 
statements and the message which might have originally been 
there about your unique and powerful differentiation has been 
totally overwhelmed and lost in the mix.

You need to carefully consider which customers and which 
markets will make buying decisions based on what sets your 
company and your solution apart from your competitors.

Hopefully there's a relatively long list of companies that care 
about what's unique and powerful about your solution. You can 
then take that list, marry it up against your limited resources and 
make some wise decisions based on the timing and size of 
potential purchases. If you focus all of your resources on customer 
targets that are going to make a buying decision within the next 
six months, but for whom you have no differentiation from three 
other competitors, then you *might* stand a slim chance of winning 
some business by underpricing the competition. You may get 
revenue this year, but it will be at a loss, and you will likely have 
doomed your chances of winning business next year from the 
companies willing to pay a fair price because they value your 
unique solution.

I know, I know, I can hear it already... "If we fail to get that 
revenue this year, then we’re doomed anyway. We need 
cash to keep the doors open." There are no easy answers 
here. Many more companies will fail over the next two years. 
Given the choice of a quick death or a slow, painful death 
where I’m tortured to tell lies for the next 18 months ("We really 
are all about being the world leader in xyz.") - I’ll choose a 
quick death every time.

You need to direct product development towards the areas 
critical to your success with the customers that care about what 
sets you apart.

In some cases, this will mean investing in overcoming 
weaknesses where your competitors have strengths, but it had 
better also mean investing in increasing your lead over competitors 
where you already stand apart.

All of these things are "Marketing." Many of them are dynamic, 
changing as your company changes, as your competitors change, 
and as your customers change.

Leaving them ignored is deadly.

Understanding these issues goes to the core of who your company 
is - and many companies have strayed quite far from what they thought 
they would be. Down markets change many strategies. Understanding 
your differential advantage helps you return to a set course, and helps 
keep your message consistent to the market - whether through sales 
presentations, public speeches, submitted byline articles, or whatever.

Once you have these fundamental issues down, you can make wise 
decisions about executing on marketing programs. Is it wise to spend 
money on redesigning your Website to reflect a fundamentally 
different opportunity space? Is it a good use of your cash to take 
advantage of depressed online ad rates on sites targeting the buyers 
who truly value your unique differentiation? Answers to questions such 
as these will be much easier once you're focused on the right market 

+=+=+What's Next? +=+=+

What Can You Do?
Now is the time to make sure you’re focused on fundamental 
market strategies. In fact, the best time has passed, but if you 
fail to focus on these issues now, you might as well close the 

Specifically, consider this:

- If you look at your company market definition today and it 
has dramatically changed from a year ago, stop and understand 
why. Do you know what you’re all about? Does that definition really 
create differential value to your customers? Is it defensible from 
current competitors or new entrants that emerge over the next few 
years as capital starts funding them again? Is it true to what sets 
you apart as a company on which you can capitalize to create a 
powerful and valuable lead over competitors? Or, is it a 
compromise statement made to broaden the set of potential 
customers for your products? Does it place you in a competitive 
space in which your only basis for competing is price and which 
hands all of the power to buyers who will eliminate any margin 

- Look at your marketing materials (website, sales collateral, 
press releases, sales presentations, etc.). Do they pass the logo 
test? Or do they have nearly identical messages and value 
propositions to your competitors? Have you crystallized the 2-3 
messages that clearly communicate the unique value of your 
solutions and that are defensible because they are built on the 
unique realities and capabilities of your company (unique expertise, 
unique experience, unique relationships, unique architecture, etc.)?

- Consider where you are spending your development 
dollars. Are you spending all or most of your resources to "close 
the gap" and make your product or service look just like everybody 
else’s? Or are you investing significantly in "increasing the lead" 
in the areas where you create unique value for customers? If you’re 
playing like a loser in this environment, then I recommend you drop 
out of the race and save your energy and your investors’ dollars 
for a race you stand a chance of winning.

The ability to cut through the confusion and fear in the industry, 
to look through today’s fog to perceive tomorrow’s potential 
futures, to logically and sensibly and bravely ask and answer the 
critical strategic questions, and to understand your competitive 
positioning and differentiation and act accordingly has never 
been more critical. Let us know if we can help.

+=+=+Need Some Help? +=+=+

TeleChoice helps companies everyday better position their 
firms and products for success, whether re-examining 
fundamental business strategy or clearly communicating 
unique position and value in today’s tough marketplace.
Contact us at or visit (

+=+=+About TeleSparks+=+=+

On occasion, we share with our industry 
friends our views on major events and issues in telecom. 
We use TeleSparks as the primary vehicle for sharing these 
(usually highly opinionated) views, and we welcome your 
feedback. Feel free to forward these on to others, but please 
copy us on the messages so we have a sense of the extent 
of distribution of our views.

TeleSparks is generally authored by Russ McGuire, 
TeleChoice Chief Strategy Officer, with input from others 
throughout the TeleChoice organization. You may contact 
Russ ( or your favorite TeleChoice 
contact to share your thoughts on these matters.



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