Director Smart Insights (Marketing Intelligence) Limited
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What is the most valuable marketing model of all time?

24th Mar 2011
Director Smart Insights (Marketing Intelligence) Limited
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In this series of Smart Insights Best Practice Advice, Dave Chaffey of shares tips on best practice to get better results from digital marketing. This week, Dave looks at 12 of the most relevant marketing models and assesses their value to the modern marketer.

I’m a fan of using practical models for marketing since I think a good simple model gives us a framework to assess how we’re doing things now compared to our competitors and planning marketing strategies for the future.

Simple frameworks are also great to help learn a new area – that’s why we developed our RACE planning model for digital marketing to help structure content on our site.

The best marketing model?

I’m talking models since I recently saw a great poll created by CIM London to celebrate 100 years of marketing from the Chartered Institute of Marketing.

As a CIM Member/Fellow I thought it would be good to spread the word, so please take the CIM London marketing model poll.

I’m sure you have a favourite you’ve come across in your career. If you vote, you will see there is is a clear winner which I think is the right winner!

I’d also like to hear what you think about the relevance of these model in 2011. Have they had their day, do you find them useful, do you have better alternatives? Please tell us what you think in the comments below.

Since I’m a digital marketer, I have my own views on the relevance of these, indeed in my books I have often applied them. In fact thinking of it, most are included in my Internet Marketing: Strategy, Implementation and Practice. So I thought it would be nice to share the relevant ones here for anyone passing this way who isn’t familiar with them.

So this is what I think about their value to today’s marketer…

1. 7 Ps – marketing mix

Product, Price, Place, Promotion, People, Process and Physical evidence – these elements of the marketing mix form core tactical components of a marketing plan.

It’s right this is at the start of the list since it’s still widely used and I think is a great way to think through what a company offers. But it suffers from a push mentality completely out-of-keeping with modern digital marketing approaches of listening to and engaging customers in participation through social median marketing.

2. USP

Unique Selling Proposition is the concept that brands should make it clear to potential buyers why they are different and better than the competition.

A great concept and an essential message to communicate online since the core brand message often isn’t clear.

Here are some examples of websites that communicate their online value proposition well.

3. Boston Consulting Group Matrix

This model categorises products in a portfolio as Stars, Cash Cows, Dogs and Question Marks, by looking at market growth and market share.

I find this isn’t so applicable in the online marketing world of small and medium businesses – it’s more of a corporate strategy model.

Within web analytics though, the same thinking can be used to review which products are performing/under-performing.

4. Brand positioning map

This model allows marketers to visualise a brand’s relative position in the market place by plotting consumer perceptions of the brand and competitor brands against the attributes that drive purchase.

This is a great concept for understanding how customers see a brand. I can’t recall many descriptions of this being applied online. I have seen it used as part of user-testing though in comparing different websites?

The creation of an engaging online brand is so important to success in digital marketing, it’s a pity there aren’t more effective branding models.

5. Customer lifetime value models

Customer Lifetime Value is the concept used to assess what a customer is worth, based on the present value of future revenue attributed to a customer’s relationship with a product.


A different class of models to others, this is more of calculation model – covered in Chapter 6 of my Internet Marketing Book. CLV is mainly important online for transactional sites and certainly investment decisions like allowable cost per acquisition (CPA) must be taken with future customer purchases and attrition rates considered.

6. Growth strategy matrix

Ansoff’s matrix identifies alternative growth strategies by looking at present and potential products in current and future markets. The four growth strategies are market penetration, market development, product development and diversification.


Ansoff’s model dates back to the 1960s, but I still cover it in the books to show how companies should “think out of the box” with their digital strategies by considering new opportunities for market and product development rather than simply market penetration which misses the opportunities of digital marketing for me.

7. Loyalty ladder

This model shows the steps a person takes before becoming loyal to a brand as they move through the stages of prospect, customer, client, supporter and advocate.

Loyalty models are useful as a way of thinking through the opportunities to generate lifetime value.


As an extension of the traditional PEST model, this analysis framework is used to assess the impact of macro-environmental factors on a product or brand – political, economical, social, technological, legal and economic.

PESTLE/PEST/DEEPLIST make me groan – to me they’re a text book approach which is far removed from improving results. The results of the poll seem to suggest others agree.

9. Porter’s five forces

The five forces are Rivalry, Supplier power, Threat of substitutes, Buyer power and Barriers to entry and are used to analyse the industry context in which the organisation operates.

Yes this one features in my books and I reference a classic 2001 paper by Porter on applying the five forces to the internet. I personally think it has limited practical value – yes we know customers have more bargaining power online. So what?! I also think it under-represents the power of intermediaries like comparison sites and publishers in the online world.

10. Product life cycle

This model plots the natural path of a product as it moves through the stages of Introduction, Growth, Maturity, Saturation and Decline.

11. Segmentation, targeting and positioning

This three stage process involves analysing which distinct customer groups exist and which segment the product best suits before implementing the communications strategy tailored for the chosen target group.


As a model which is focused on delivering relevant products, services and communications to the customer and so generating value for an organisation, this is essential for every marketer to understand.


This acronym stands for Situation, Objectives, Strategy, Tactics, Actions, Control and is a framework used when creating marketing plans.


I’m a big fan of using SOSTAC as a way of implementing strategies. It features in all my books and I know PR Smith its original well – he’s my co-author on Emarketing Excellence.

Dr Dave Chaffey is CEO at Smart Insights (Marketing Intelligence) Limited, a digital marketing portal and consultancy who provide advice and software to help businesses succeed online. He is author of five bestselling books on Ecommerce including Internet Marketing: Strategy, Implementation and Practice and has been recognised as one of 50 marketing gurus worldwide who have shaped the future of marketing.

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By pkward
24th Mar 2011 13:56

A model I've been developing and applying successfully is what I call the Five Forces of customer experience.

The core inspiration is the idea that value is created in the mind of the customer. What someone is willing to pay is based on a complex mix of perception drivers. How these perceptions are created, and can be managed by companies, are topics critical for businesses to understand. It makes explicit a lot of the underlying assumptions in Porter's Five Forces - you'll note that his forces do not explicitly include people.

The five forces of customer experience that I have identified and names are:

1. The person (how do I define value? how do I define values? what emotions are in play? what rationales are in play?). This is the discipline that brings together decades of work on cognitive, behavioral, cultural, and brain studies. You can't be a good marketing company anymore without knowing who Daniel Kahneman is. Nor can you be an international company without knowing the work of Sproles, or the GLOBE cultural taxonomy. 

2. Networks of data. (Comparison sites may be an example, but they quickly morph into the third force below.) A network of data might include product specifications, maps, fact sheets, Wikipedia. They tend to allow the customer to form an opinion with minimal tendentiousness. While these sites are important, especially for complex or technical purchases and in the B2B environment, in my own view, their value is swamped by the third force.

3. Networks of opinion. (Comparison sites, UGC sites such as Yelp, Facebook, etc.). Networks of opinion are trusted because they include "people like me." These people may be proxies for networks of data (experts), or they may simply be taste-makers/trendsetters (the hipsters on Yelp). Influence analytics matter here.

4. The company's brand. (What do you expect from a company based on their public presence and reputation?) Boy, we could go on and on about brand. What I love is the concept of "brand hijack," which shows that a customer-centric set of forces is essential to understanding a company's market valuation.

5. The company's interactions with the customer. (How do representatives of the company, and representations of the company, such as CSR personnel, websites and tweets, advance or destroy my sense of the brand and/or support or threaten my value/values/emotional/cultural frameworks?) 



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By npoulos
25th Mar 2011 03:49

I am partial to a model that came out of a boutique in Milwaukee, where Vic Hunter, Mark Peck, Mike McIntosh, and I proselytized an integrated, data-based, direct sales, marketing and "service" model that recognized that an ideal model was based upon Targeting - Segmentation (needs-based, buying decision-based), & Grading or Valuation; in essence it is a resource allocation strategy that I have yet to see fail: it produces an increase in sales, an increase in cross-product acception and penetration, a reduction in cost-to-serve the marketplace, increase in customer satisfaction, increase in employee satisfaction: whew! This isn't an out-of-the-box solution, but it is fairly straight-forward and applicable to virtually all B2B and not-for-profit organizations. Moreoever, it works well with the other noted frameworks and actually accepts more models such as those of Adrian Slywotzky and McKinsey nicely.

-- Managing Director, Chrysalis Marketing 414.324.2559 [email protected] "to live is to do battle with trolls in the vaults of heart and mind; to write, that is to hold domesdag over one's self." - Ibsen

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By its_me
03rd Apr 2012 12:15

The field of marketing goes through constant evolution. It is important for a marketing campaign to implement all the new strategies like Mass Texting for example. A properly planned campaign will be able to impact the target segment in the most effective manner.

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