What Type is Your Business / Industry?
And how to identify ways in which you can improve it?
What if I told you, there is a magic way to analyze any business/Industry and find out some key points that can improve that business/industry? and you don’t have to do tedious calculations to do this! Sounds too good to be true right?? Well, there is a way! quite a famous one and used by major strategists and coined by his highness Philip Kotler, the undisputed king of Marketing!
In the latest edition of Kotler’s book “Marketing 4.0”, the guiding light for marketing professionals, a new way to categorize industries is described. But before we understand that, you must know the 5 Stages of the Modern Consumer Journey! Aware, Appeal, Ask, Act, Advocate also known as the 5 A’s of Consumer Journey. Every customer follows this path when purchasing a product/service. If you know it already, you are amazing! And if you don’t know it yet or want to know it again in the easiest form read this article to get to speed — The Modern Consumer Journey
Based on the 5 A’s, 4 Industry Archetypes can be created to categorize all the businesses/industries! And by the end of this article, you will be able to apply these models to some famous companies and be amazed by how great a marketer you have become! 😛
So, without further ado, let’s begin!
1. Doorknob Pattern
This is the most common industry pattern! High level of Awareness, low appeal, and even low curiosity(ask) but high commitment (act) and low brand loyalty (advocate)! The best example of this is the Consumer Packaged Goods (CPG) industry! As you can see from the pattern, Awareness for this industry is very high, since these are very common brands and their ads are everywhere! Your Washing Powder, Bathing Soap, etc. are perfect examples of this. The most distinctive feature of this pattern is high commitment despite the low curiosity level.
Customers mostly go for best deals, so the brand attachment is low. Even the availability of products makes difference, so if a favorite product is not available, customers buy alternatives! They might like a brand but are not loyal to it!
Remember when you went last time to purchase groceries and didn’t find your favorite brand but still bought some other brand since you didn’t have the patience to wait for your favorite or go to another shop! Now you know that Consumer Packaged Goods is the best example of doorknob pattern!
2. Goldfish Pattern:
The second major industry archetype is Goldfish Pattern. High Awareness, Low Appeal, Higher Curiosity (ask), lower commitment (Act), and lower loyalty (Advocate). The most distinctive feature of this type is higher curiosity (ask > appeal)!
These are products/services that require a lot of searching before buying so people ask a lot of questions and research a lot! But then even with the higher research, commitment to buy is low since multiple people are involved in the decision. These purchases take time and a lot of thought.
Can you guess any industry that has this kind of trait?? Well yes, Tourism is one of these! Multiple people decide, they research a lot, and even with all the research, it’s a time-consuming process to make the purchase. All B2B (Business to Business) transactions fall in the Gold-Fish Pattern. Where there are a lot of stakeholders involved in making a purchase decision, lot of research goes in and the overall process is pretty time-consuming. Another example from day to day life is Purchasing a House/property!
3. Trumpet Pattern:
This is a very special category. High Awareness, Low Appeal, Lower Curiosity, followed by lower commitment but higher Loyalty. Probably the most distinctive feature of this industry is Higher Loyalty even with lower purchases. Can you guess this industry?? It is the Uber cool, white-collar Luxury Industry! Where a lot of people know about the product, but fewer are interested. People don’t need to ask much because of the well-established brands & superior image. Naturally fewer people buy as these are premium products/services. But loyalty is very high among those who purchase it.
There are many fans as well who cannot buy but they still admire the product and might want to buy some time in the future. So even those who don’t buy, advocate about these products/ services! Typical Examples of this would be Rolex Watch, Luis Vuitton Accessories, Apple Products! Even when a lot of us don’t buy it we certainly want to buy at some point and would definitely advocate about these! Right?
4. Funnel Pattern:
As some of you might already know it, the traditional Funnel Pattern. In this pattern, most purchases are well planned, and customers are highly involved in purchase decisions. Each step of the journey counts and if a brand doesn’t perform well up to expectations, people drop off from the journey! People ask questions about brands they know, if they like it, they purchase it eventually. People who have good experience become advocates!
Mostly Consumer Durables and major service industries fall in this pattern! These are the most difficult purchases so once a customer buys it, they rarely switch to another brand. Or if they are unsatisfied, they buy premium services/products. Buying a Car, an online subscription, etc are perfect examples of this industry!
Now all said and done, you must be thinking okay I now know about the major industry types but how to improve? if you have read till here, here is your answer:
5. Bow-Tie Pattern:
Considering all the good and bad points of these archetypes, an Ideal Pattern can be described. Bow Tie Pattern. Where everyone who is aware is an advocate (Aware = Advocate) and everyone who has attracted ends up making the purchase (Appeal = act). And people are so convinced with the product that they don’t ask much (Ask is low)!
This Ideal Pattern gives us insights about what should industries in a particular archetype do to improve!
Improvement Strategy:
Depending on each industry type here are a few things if done properly, can make wonders happen:
- Doorknob: Brands need to increase the post-purchase engagement of customers. They can do Programs like rewards, outreach programs can help CPG industries to retain their customers. However, it’s tough as the space is crowded with a lot of players.
- Goldfish: The B2B industry! this is the toughest industry to improve since these brands not only have to improve commitment and affinity but also optimize curiosity! Out of the box, Campaigns to generate appeal, aggressive offers to improve sales, and best in class after-sales service are key elements to improve! Since the customers in this industry are savvy about the products, they need more convincing.
- Trumpet: Brands need to improve affordability and accessibility so more people can buy however, they must ensure their brand value is not diluted in the process!
- Funnel: Brands need to improve sales in aggressive ways but also give special attention to after-sales service. Since customers are knowledgeable and involved in each stage, attention must be paid to at all stages ensuring the lowest number of customers drop while going to the next stage!
These guidelines will help most businesses figure out where they need to focus! Do you think these archetypes are helpful? try applying them to your industry and tell me under which pattern does your industry fall?
If you found this article helpful do share it! if have any suggestions let me know in the comments!
Cheers !!
Tejas
