Using Marketing Signaling to Your Advantage

If you want your brand to be a market leader or category disruptor, make sure your marketing signals it, or they might not believe it.

In manufacturing, differentiation is key. But unless you've made a concerted, disciplined effort to differentiate your product from the rest, buyer perception may not reflect the reality of its specific attributes. Marketing helps bridge the gap between perception and reality. When you understand what your marketing approach is communicating with current and future customers, you can maximize your return on investment.

Marketing Signaling

Marketing signaling is any communication that provides information beyond the mere form of a message. Think about the lasting impression you get from a hand-written thank you note versus the exact same message in a text. Why are they so different? It's because the hand-written note signals a much greater investment from the sender. They took the time, care and added attention to intentionally elevate the experience. The signal this sends is that they really are grateful, and you can believe it.

Digital marketing channels provide a lower cost alternative to other forms of marketing. But in an effort to cut costs, companies signal to buyers that their product is no more special than other products marketed similarly. But even a digital marketing approach can provide strong signals to the market if your SEO gets you on the first page of results. When you land near the top, this signals that your offer is more important.

One of the best examples of marketing signaling in our current digitally centric marketing era is the fading popularity of more expensive traditional advertising. But one of the key reasons advertising works is because it is expensive. While this may sound counterintuitive, it is one of the most scientifically backed ideas in all of advertising. It's a concept called "costly signaling" and is well-studied because it is a core component of evolutionary biology. Altering the perceptions of others is difficult, and thus doing it in ways that are very difficult to fake is far more persuasive.

John Kay, an economist at Oxford University explains the role of signaling in advertising in this way: "The advertiser has either persuaded lots of people to buy his product already, a good sign, or has persuaded someone to lend him lots of money to finance the campaign."

If you don't advertise at all, it may signal to a prospect that you aren't doing as well as those that do.

A Powerful Way to Leverage Marketing Signaling

One of the best ways to take advantage of marketing signaling is to conduct primary research. Taking the time, care, and attention to ask your prospects and customers what they think sends a uniquely high value marketing signal.

There are many other tangible benefits to conducting primary research. It provides a competitive advantage in that you have unique and timely marketing insights that your competitors likely do not. The act of conducting research also signals to your prospects and customers that you care enough about what they think, believe and value to take productive action to enhance their brand experience. Primary research raises your credibility and signals market leadership. Those surveyed know intrinsically that you have solicited their input in learning what is important and have provided them an opportunity to share their perceptions honestly with you and expose yourself to constructive criticism.

Many of the things we want to know when buying a product or service, especially for the first time, are not directly perceivable. Customers often have far less knowledge of the true value of a product than the company they are buying it from. This is especially true for manufacturing companies, whose primary market is other businesses. A lack of knowledge can create a gap between real value and perceived value. Signaling expertise can be an important bridge to close that gap.

What is Your Web Presence Signaling?

One of the most common signal failures we see with companies is they have innovative, quality products, but a dated website.

This is often the first experience a prospect has with a brand, and if it is unsatisfying, it can send a costly, negative signal that the company and its products are nowhere near the cutting edge. This failure begins to trickle down with less effective site performance, which affects Google rankings, which begins to send a signal that the brand is not a leader. Every element of marketing sends a signal. If you regularly post well-produced, insightful content, it signals you have a commitment to sharing knowledge and are likely a thought leader. In addition, B2B buyers have come to expect it, so this signals you are in touch with their expectations. Prospect engagement with articles and case studies during the purchase process averages about 70%. If you aren't creating informative content, it signals to them you aren't committed to them.

There is a concept of information asymmetry that is almost always at work in the buyer-seller relationship. The web has provided a much better opportunity for the buyer to close the gap between what they know and what the seller knows. Search, online reviews, and related information-sharing have leveled the playing field.

Companies that are committed to transparency and honestly communicating with their customers on a regular basis tend to view marketing as an investment rather than an expense. They also truly understand the importance of the market signals they send.

Check out our published article in Precision Manufacturing Journal

Mpma article

View the article in the Precision Manufacturing Journal

Last edited: 9/15/2023