Radio Shack could have saved a lot of money (and jobs) by focusing on inbound marketing
Radio Shack filed for Chapter 11 bankruptcy today, seeking shelter for its dwindling stake in their market vertical. In this blog, I'll go through the differences between outbound & inbound marketing, comparing the two types in regards to cost and capture.
Inbound Marketing: What is it?
Inbound Marketing is a way of marketing to gain authority within your market verticals through SEO, blogging, web presence, email campaigns, etc. This form of marketing is generally not predatory to the potential consumer or client, and allows online researchers or potential clients the ability to find you, rather than going after their business in a more predatory manner. Successful inbound marketing allows companies the benefit of receiving contact via email, contact, or call from a warm lead, rather than creating their market through outbound marketing efforts, which are almost always more costly.
Inbound Marketing: What makes it successful?
Successful inbound marketing starts with understanding your core products, along with knowing what people are searching for in relationship to your core products. A successful business will have no more than 3-5 core product lines, along with peripherals that support their core product line. Most of the efforts are spent by the company to draw attention to their core products, while building an extensive background of supporting information for consumers to research and make a better informed decision.
Let's look at Apple as an example of successful marketing and product branding. While they offer a multitude of products, they focus on their core product items being the iMac, Macbook, iPad, iPhone, iTunes, and soon the iWatch. While they offer everything from phone cases to charging cords, they maintain focus on their core products and are consistently establishing market share within their market verticals for their core brand items. The consumer is never confused by what their core products are, and more importantly Apple has created supporting documents to allow consumers the ability to research their products completely through their website. Apple does a great job of maintaining market competency with their potential customers.
Could anyone share with me what Radio Shack's core product line is?...I think not. They are providing a jack of all trades approach or what I call a shotgun blast approach to gaining market share. I would hate to be on the marketing team there, trying to figure out what type of bait I would be using this week to pay the electric bill.
Inbound Marketing: Spinning your inbound marketing web
A lot (and I mean A LOT) of companies have always taken a shotgun approach to gaining market share, neglecting the opportunity for successful inbound marketing, while focusing on more costly outbound marketing. We'll talk about outbound marketing shortly, and let you be the judge of where your marketing dollars are better spent.
I've coined a term called spider webbing in business, which leaves a lot of people scratching their heads regarding what this truly entails. Let's look at the ideal image of a spider web and place your core product lines into the web. If the "lead" is the center of the web that leads into your sales funnel, each ring of the web represents different product lines. If we place each of your core products on the first inner ring from the center, we naturally would place the immediately supporting peripheral items on the next ring of the web and so on and so on. Draw a spider web and place your products in the web and see what that looks like.
Once your web has been spun, you have made a clear determination as to what the focus of your marketing efforts should be. This will also allow your supporting documentation and sales process to make solid suggestive selling workflows. Using Apple from above as an example, their web would ensure that the iPhone would be on the first inner ring, followed by phone cases, chargers, etc. on the second ring. If the consumer shows interest in an iPhone 5 case, their inbound marketing effort should automatically spin into an email campaign that starts suggesting upgrades to an iPhone 6 or 6 plus. Once the consumer has shown interest in upgrading their phone, Apple does a great job during checkout of recommending suggestive sell items like cases and screen covers. Their retail location staff is designed to imitate the same sales process.
Inbound Marketing versus Outbound Marketing
Each has its place in the market today, however we are finding the relative cost of each is drastically different. Outbound marketing generally involves cold calling, mail campaigns, television commercials, radio ads, etc. These can be very costly for a company, along with seeing a drastically reduced close ratio and increased customer acquisition cost. Inbound marketing allows a business to search out the clients virtually that are already looking for their product or service, and allows the business the opportunity to directly compete for the business through education, price, and support. Inbound marketing levels the playing field, and allows every business the same opportunity to succeed.
Need to start inbound marketing?
Inbound Marketing: Which direction should Radio Shack move in?
This is actually the easiest example of a company that has capital position to turn their ship on a dime and succeed moving forward. Radio Shack has been caught in the age old "That's how we've always done it" mentality, allowing competition to catch up and beat them in the retail vertical. If they make the conscious decision to shift their marketing efforts to focus on modern technology, I could see them pulling through their current situation, and find themselves in a positive situation in short order. Then again, I still get the radio shack ad in the mail, even though I don't read it...ever! I used to get the Sear's and JCPenney's catalog in the mail too!
Related articles:
Need help with your Inbound Marketing? We'd love to help!
Inbound Marketing Services by Kpahi
