Downstream Marketing is Tactically-Driven
Downstream marketing is what most people visualize as marketing and involves advertising, promotion, brand building, and communicating with customers through digital marketing, public relations, social media, and in-store. While these activities are extremely important, they tend to enhance the acceptance of a product or service that already exists. Further, companies spend an inordinate amount of money on downstream marketing activities and ignore critical upstream marketing activities.
Uses Insight, Identity and Innovation to Transform Businesses
Upstream marketing, by comparison, refers to the strategic process of identifying and fulfilling customer needs. Upstream marketing takes place at a much earlier stage by developing a clear market segmentation map, and then identifying and precisely defining which customer segments to focus on. It analyzes how the end user uses the product or service, and what competitive advantage will be required to win the customer and at what price point. This is done very early in the product or service development cycle and is one of the missing links for generating revenue growth at many companies.
Upstream Marketing Analogy
Here’s another way to look at upstream marketing: Ever gone fishing? Think of upstream marketing as everything that happens before the hook is in the water. The best anglers reflect and act on several factors before they cast the line. First, they’ll consider the kind of fish, the method (fly fishing or bait casting), and the tools needed—the type of rod, reel, fishing line, and so on.
After answering a few other questions: Where exactly will they go to fish, which lake or river? Where within that lake or river? At what time? What’s the best bait? They then bait the hook and cast it into the water.
In doing all this, good anglers observe the essential principles of upstream marketing, thinking through the five W’s—who, what, where, when, and why—before integrating with downstream implementation (sometimes literally), in landing the target.
“It is well known that ‘problem avoidance’ is an important part of problem-solving. Instead of solving the problem, you go upstream and alter the system so that the
problem does not occur in the first place.”
Edward De Bono, author, Serious Creativity
"Because the purpose of business is to create a customer, the business enterprise has two—and only two—basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs. Marketing is the distinguishing, unique function of the business.”
Peter F. Drucker, management guru
"As to methods, there may be a million and then some, but principles are few. The man who grasps principles can successfully select his own methods. The man who tries methods, ignoring principles, is sure to have trouble.”
management consultant and efficiency expert