The Purpose of Modern Marketing

The purpose of modern marketing is to fuel our referral engine.

Referrals – word of mouth recommendations – are what truly power a business.

Our best new customers come from… our best current customers.

If the referral engine isn’t generating new business for us, then our product or service isn’t good enough to generate word of mouth. Our customers don’t see the value we provide as so amazing that they have to tell everyone they know about us.

Marketing’s goal is to attract enough strangers to try our product that we build a base of insanely happy customers. After that base is built, marketing’s job is simply to amplify the word of mouth that our value creates.

Here’s how to tell something is seriously wrong. How long does it take for a customer to see the value in our product or service?

  • A pack of gum should have near immediate value.
  • A restaurant is after the meal is over and digested without issue.
  • An ERP implementation might need a few years.
  • A fuel-efficient vehicle is after the first couple of fill-ups.
  • A grocery store’s produce is how long the produce stays fresh after purchase.

However long that value cycle takes, that’s when we should see referrals beginning. If we deliver value in 90 days, then if our product or service is great, we should see a referral on Day 91. If we’ve delivered our product or service, our customers have had time to experience our value, and we see our referral engine sputtering, then we know we have an insufficient value problem.

Here’s an easy way to measure. Figure out the value window for our product. Then make a rolling average of our referrals by that number. For example, if our product delivers value in 30 days, then we construct a simple moving average of our referrals over a 30 day rolling period:

30 day rolling average

If that line goes any direction except up and to the right, we have a problem with our value cycle.

Throwing more marketing resources at a product or service that isn’t worthy of referrals is a recipe for failure. It might take weeks, months, or years for the failure to occur, depending on how much of a mismatch there is between our promise and our value, but it is inevitable – unless we improve our value to be worthy of referral.


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