The term “market” must be just about the most over bandied term in…ironically…marketing. As Sales and Marketers, we use the term occasionally when we mean market. Accidentally or with educated intent. We also use it on occasion when we mean customer segment. And sometimes when we mean value chain. And sometimes when we should use the term distribution channel. Worst offence of all is when we call groups of products or services “markets”. I was in a Group Exec meeting of a global goliath’s Australian affiliate that supplies to major construction and they spoke about their “accessories” market. I hope they did not hear me squirm in my seat. Come on, Sales & Marketers… imagine if your doctor told you that you needed an operation on your ear, when he/she really meant your eye!
Let’s get our basics right.
Groups of products and services are not markets. They are what ultimately goes to a market(s), with or without value added along the way. Customer segments are not markets. They are homogeneous groups of organisations that assemble themselves in a sequence to add value to groups of products and services, as they go to a market. A value chain is not a market. It is the name we should use to apply to the aforementioned customer segment assembly. A distribution channel is not a market. It is a bifurcation in a value chain – in other words, where a product or service (group) can go via more than one parallel pathway within the value chain, and the value being added by each parallel segment(s) in the distribution channels is essentially the same.
The term “end user” is close to the best definition of market……but even then it is only half of the picture.
The definition of a market should include the specification of the end user. In this context, the end user is in fact another customer segment. It is just that the end user is always the last segment in the value chain and/or any distribution channels that may characterise a value chain. The full and meaningful definition of the market must also feature the description of the product/service that, from the perspective of the organisation in question, pumps into the value chain. But the description must relate to the end user’s perspective of the product/service in question – in other words, it must be described as the product/service appears in its original form for the last time (which equals changes ownership for the last time +/- is consumed for the last time).
How is all this relevant to high performing Sales and Marketing? Go to Market strategy is all about crystal clarity about what we sell, via whom, to whom, by whom, for whom, versus whom. It’s all about the right choices and best bets. This cannot be achieved without all stakeholders in the Sales and Marketing group aligned in this respect. Here is a model that depicts these constructs (Click here for model).
Glenn Guilfoyle is the Founder and Principal of The Next Level, a specialist B2B sales consultancy. For more insights like this, check out The Next Level’s proven sales process.