IEM, a recipe for an outstanding marketing strategy
1. An efficient marketing meme ("archetype") consists of two parts: a key and an actuating medium.
Its key may be a word ("cellphone", "fancy car", "fur coat"), a sound, or a visual image; generally, an impression.
The key’s only purpose is to upload the actuating medium into one’s mind — one that will actually squeeze out one’s money in the meme beneficiary’s favour.
With "cellphone" as the key, the actuating medium is "iPhone" (or, "I want an iPhone!") With a fur coat hanging in the shop window as the key, the actuating medium is, "I want the fur coat!" With a "cool car" as the key, the actuating medium is "a Cayenne". With "Motherland" as the key, the actuating medium is, "The Yankees suck, we’re cool, and Putin rules."
2. Both the keys and the actuating mediums form in one’s head, shaped by lots of factors in one’s environment (mainly by the people around) – mainly spontaneously.
The art of marketing is to competently interfere with the chaotic archetype generation processes in the target audience’s heads — to channel the monetization cash flow into the right strongboxes.
3. The Key + Actuating Medium model predicts the existence of two fundamentally different groups of marketing strategies: at the actuating medium and key levels.
4. An aggressive marketing strategy at "actuating medium level" aims to reload (replace) an existing actuating medium with a new one — for different beneficiaries, of course. So that one goes to the Fur Centre in Mosfilmovskaya Street for a fur coat, instead of The Snow Queen.
99.9 per cent of marketing strategies in the world are of this type.
That’s why they work so poorly.
A healthy person’s mindset is quite a conservative system homeostatically disposed towards stability.
Loosely speaking, if the "Key A, Actuating Medium (1)" archetype has settled down in somebody’s mind, it will be highly problematic to sever this link and to replace the second part with "Actuating Medium (2)". It takes non-trivial circumstances to make one’s mind accept this replacement. In accustomed circumstances, it is IMPOSSIBLE to correct the incumbent archetype. For instance, just try to convince a Stalinist, with facts and figures, that Stalin was a catastrophic loser in all matters except genocide of his subjects…
It is the mind’s conservative nature and biological perseverance in defending previously stabilized archetypes that is the neuro-physiological basis of the market crystallization law. First type strategies are quite visible on TV, Billboards, and everywhere.
5. The second group of marketing strategies is about creating a new key.
Something that is meant in the sententious saying, "Want to become a millionaire — create a religion of your own," misattributed to Ron Hubbard.
Only one strategy of a thousand belongs to this type. But such a strategy is essential to outstanding success: Apple’s today, and Coca Cola’s a century ago.
Actually, every outstanding instance of business success, without exception, is based on house keys created (often unwittingly or accidentally). Moreover, without these no outstanding market success is possible in principle.
An efficient key will lift even the most ordinary product to the pinnacle of success.
And, on the contrary, without a new and powerful key even the greatest invention in mankind’s history is doomed to be forgotten.
On the other hand, if you have a high quality marketing key, product quality will not matter within a limited time range. Moreover, for some time you will be able to collect money without a product at all, like "developers" of "artificial intelligence" have raised tens of billions of dollars over the past five decades.
The opposition between "red and blue sea strategies", common in business literature, is actually a visualization of bloody (and 99.9% senseless) battles for actuating media reloading as opposed to the serene flight of gifted marketers" fancy as they create new keys and nothing else.
For if you create a new key, you monopolize (at the first stage at least) the manipulation of your actuating medium. If you are a talented marketer good at this, your results will be similar to Apple’s, Google’s and Coca Cola’s (adjusted for the scale of your market).
But, most importantly, the market crystallization law means that if you initially retain possession of a newly created key’s actuating medium, you secure a colossal and effortless cash flow (until the market "thaws" again): "we sit and the money comes".
Once the market has crystallized, the "sea" turns red. Crowds of stupid people waste billions of squids and thousands of man-hours trying hopelessly to reload your actuating medium. And you look down on them as Apple looks down on HTC.
Generally speaking, the only thing required of you is NOT to sever the link between your key and actuating medium by doing some especially stupid thing — like Ford, for example. In the case of Coca Cola, their management was doing its utmost to undermine their market position — but neither could it kill the business nor do it any serious harm.
6. We can identify an intermediate group of hybrid strategies based on niche modification of an existing key.
Instead of competing in the market of mayonnaise as such, we identify an Olive Oil (Thick, Light, Quail Egg… ) Mayonnaise sub-key from the generic Mayonnaise key and go on to compete in this sub-category. Starting from a leading position if all was done correctly.
It is sub-key generation that Trout means as he writes about the capture of attributes in existing goods categories in the process of marketing differentiation.
7. Let us try to assess the comparative efficiency of "actuating medium strategy" vs. "key strategy".
The actuating medium substitution strategy has a chance to succeed only if fabulous money is spent on advertising. To obtain any result whatsoever, you have to spend months (more often, years) brainwashing your target audience through every coffee grinder. But even this will NOT guarantee success. And nothing will keep your competitors from using the same strategy to attack your market position — or defend theirs. In the long run, both brands and consumers are to lose (as money is wasted on making the public sick with those silly commercials).
The strategy of creating your own key is far cheaper.
Now many iPhone owners gave away their money simply because they were converted into "true faith" by Apple’s ads?
And there were not that many ads, after all.
The intermediate strategies predictably lie in-between in terms of efficiency.
In the late 19th century, Daimler-Benz missed its opportunity to privatize The Automobile, but it keeps earning good money by exploiting the Prestigious, Comfortable Auto key that it has managed to capture.
And, again, the share of Mercedes-Benz buyers whose choice was prompted by ads (broadly understood) is hardly greater than one-third, according to our subjective estimate.