Are you an ? This training is worth 25 Continuing Education Units (CEUs) to maintain your PCM®️ certification.

���������t Our Learning Partner

This course is hosted by our approved learning partner, MindEdge, whose mission is focused on helping adults learn the fundamentals and master the skills needed to succeed personally and professionally.

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What Are the Four Ps of Marketing?

Marketing is the activity, set of institutions, or processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. The four Ps of marketing is a marketing concept that summarizes the four key factors of any marketing strategy. The four Ps are: product, price, place, and promotion.

The History of the Four Ps of Marketing

The four Ps were popularized by , in the 1950s, as part of the overall marketing mix. The four Ps of marketing are still widely used today by marketers and companies to advertise their goods and services.

Understanding the Four Ps of Marketing

Now that you know what the four Ps of marketing are, let’s break down each one so you can utilize each in your own marketing strategy.

What is Product?

The product is what your company sells. For example, maybe it is smoothies from your juice bar or jewelry from your e-commerce store. Or, it can be a service, like yoga classes or therapy sessions. The product is what you make available to the consumer. Ideally, your product or service should fulfill an existing consumer demand. The type of product or service you offer helps you determine how much to charge for it, where it should be placed, and how it should be promoted. (The other three Ps of marketing!)

To capitalize on successfully marketing your product, you need to identify why it is different or special. So, what sets your product apart from other products like it on the market? How can it win over customers and beat the competition? The key to this P of marketing is determining what it is that makes your product unique or special.

Example of Product

Many successful products and services are the first in their category. For example, that had the ability to do much more than simply make phone calls.

What is Price?

Price is the amount of money you charge customers for the previously determined product or service. The drives up the most amount of sales and the most profit for your company. The price also must be related to the product’s real and perceived value.

Example of Price

There are , like supply costs, seasonal discounts, and competitors’ prices. There are also other reasons to raise or lower prices. For example, some high-end businesses might to appeal to an affluent audience. On the other hand, other businesses might lower the price of a newer product or offer a discount to entice more consumers into buying and trying the product.

What is Place?

The third P of marketing is place. This is the place where you should sell your product and how it should be delivered to the market.

Example of Place

For example, would it be better to sell your product from a brick-and-mortar store or an e-commerce website? Or, it can refer to where you place the product within your store’s display. Place can even refer to where you choose to advertise your product, like on TV, social media, or web pages. The ultimate goal of place is to determine the best place to get products in front of the customers who are most likely to purchase them.

While place might seem irrelevant if , it actually is extremely relevant. For example, on which social media platforms are you promoting your e-commerce website? Place and promotion are tied closely together.

What is Promotion?

The final P of marketing is promotion. Promotion includes all of the advertising and public relations that make up your promotional strategy for your product. The goal of promoting your product is to show consumers why they need it, what problem it will solve for them, and why they should fork over their hard-earned money for it. What is the best way to reach your target market? It might be a social media platform, a PR campaign, or an SEO strategy.

Example of Promotion

There are so many ways to promote your business today and so many tools available to help you do it. The key is choosing the right method of promotion in order to reach your specific target audience. They might include online marketing, SEO, social media, Google Ads, social media advertising, affiliate marketing or influencer marketing, content marketing, or email marketing.

Marketing Strategy Examples

To create an excellent marketing strategy, here is an example:

Step 1: Product: Determine what it is that you sell, whether it is a product, service, consulting, etc.

Step 2: Price: Decide how much you will charge for your product or service that will both help you make a profit, but is realistic for your consumers.

Step 3: Place: Choose where you will sell your product or service.

Step 4: Promotion: Pick the best method of promoting your product or service.

Marketing Analysis Example

If your current marketing strategy doesn’t seem to be working, perform a marketing analysis by working your way through each of the four Ps of marketing to determine the issue. Maybe it lies within the product, price, place, or promotion. For example, maybe you have an excellent product, but the place you are selling it isn’t working.

The Four Ps are Essential for Marketers

If you want to stand out from your competitors, you need to leverage the four Ps of marketing. For more marketing tips, consider joining the ���������! We offer Digital Marketing Certifications and more to help you be the best possible marketer.

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Given the positive and direct impact marketers can have on growth outcomes, we hope our study will motivate marketing practitioners to work with entrepreneurs and early-stage ventures in emerging markets. Governmental and non-governmental organizations actively serving emerging markets should also benefit from our findings when designing and implementing future business support services. Entrepreneurs should also take note of our findings and solicit marketers’ help. Finally, we hope business schools will incorporate versions of our ‘remote coaching’ intervention into their emerging market programs with a focus on matching entrepreneurs with their marketing students. We also hope multinationals will participate in future remote marketing coaching interventions like ours. In short, we envision multinationals allowing and enabling their interested marketers to spend a few hours a week remotely coaching an emerging market entrepreneur. This endeavor, we believe, could be a win-win for the entrepreneurs and the multinationals: The entrepreneurs’ businesses would likely grow and the multinationals would likely have more satisfied employees, accrue corporate social responsibility-related benefits, and learn about opportunities (and threats) that exist in emerging markets.

.

Read the authors’ slides for sharing this material in your classroom.

From: Stephen Anderson, Pradeep Chintagunta, Frank Germann, and Naufel Vilcassim, “,” Journal of Marketing.

Go to the Journal of Marketing

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Interorganizational Lifetime Achievement Award

The 2019 ��������� IOSIG lifetime award recipient is Professor James R. Brown, a Professor Emeritus of Department of Marketing in the John Chambers College of Business & Economics at West Virginia University, USA.

Selling and Sales Management SIGS Lifetime Achievement Award

The 2019 SalesSIG lifetime achievement recipient is Jagdip Singh, AT&T Professor of Marketing, Co-Director of MSM-Business Analytics Program, and Professor of Design & Innovation, Weatherhead School of Management at Case Western Reserve University.

Marketing for Higher Education SIG Lifetime Achievement Award

V Kumar is the recipient of the Marketing for Higher Education SIG’s 2019 Lifetime Achievement Award. 

MASSIG Lifetime Achievement Award

Craig Andrews is Professor and Charles H. Kellstadt Chair in Marketing, Marquette University, and winner of the 2019 Marketing and Society SIG Lifetime Achievement Award. Winners of this annual award have contributed a significant body of work in developing and advancing research in the Marketing and Society, Public Policy, and/or the Marketing Ethics areas. This award is given to individuals who exemplify outstanding scholarship in these fields. 

Significant Contributions to Global Marketing Award

The Global Marketing SIG is pleased to announce that David A. Griffith is the recipient of the 2019 Significant Contributions to Global Marketing Award. The Significant Contributions Award honors a scholar who has contributed significantly to the field of global marketing.

Churchill Award for Lifetime Contributions to Marketing Research

The Marketing Research SIG Award Committee has selected Gerard J. Tellis as the recipient of the 2019 Churchill Award for Lifetime Contributions to Marketing Research.

The Churchill award recognizes an individual’s contribution to marketing research including new methodologies, seminal publications, books, awards and other notable contributions.

Sport & Sponsorship-Linked Marketing SIG Paper of the Year

Mazodier, Henderson, & Beck’s JM is “Paper of the Year”

The group’s “Paper of the Year” in Sport Marketing is entitled “.” Published in the Journal of Marketing in 2018, the paper was authored by Marc Mazodier, Conor M. Henderson, and Joshua T. Beck

Published in the Journal of Marketing, the results of Mazodier, Henderson, and Beck (2018) suggest that in today’s digital era sponsors should prioritize fans who have been commonly ignored: highly identified fans who are out-of-market. Such fans may be even more motivated to both buy team goods and actively choose products from sponsoring brands. The results of a series of experiments involving fans of the English Premier League, the Los Angeles Lakers, Paris Saint Germain, and the National Football League recommend that sponsors should microtarget fans by audience location and interests on social platforms to achieve various sponsorship-linked marketing objectives. 

Entrepreneurial Marketing SIG Gerald E. Hills Best Paper Award

Nicole Coviello and Richard Joseph have won the EM SIG‘s Gerald E. Hills Best Paper Award for their 2012 JM article:

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The literature on growth is vast, but almost all of it presumes that growth is a matter of following well-known principles of business as usual. This succeeds when growth is found in comfortable places. For decades, this has been the case, but it is true no longer.

Growth has not been squeezed out by adverse conditions. Rather, growth has shifted to places beyond the reach of companies unable or unwilling to get uncomfortable.

Growth in uncomfortable places is the clarifying lens that companies must bring to planning for the future. Thus, it is critical to know more about uncomfortable places. Five key facts about the global marketplace bring this into sharper focus.

Fact No. 1 is that real income per capita grew 43% from 1980 to 2016 for the middle four income deciles of the global population, according to the “.” Essentially, this is the traditional middle-class. Contrast this with the bottom half of the population, which enjoyed 94% real income growth over that same period. In other words, the strongest growth is outside the traditional comfort zone. It’s true that incumbent brands have doubled down on this emerging middle class, but it’s not the same consumer.

Moreover, the top 10% of the income distribution grew 70% over this period. So growth is strongest at the top and the bottom. This idea of an hourglass economy is not new, yet the disappearance of a robust middle-class mass market is something that many brands have yet to adapt to.

Economic bifurcation is emblematic of the broader splintering of the mass market into niches of all sorts, including economics, culture, religion, identity, social engagement and—especially nowadays—politics. Every splinter requires a different strategy, and this is uncomfortable because it means grounding the economics of scale in a conglomeration of distinctive niches rather than the efficiencies of mass production and mass marketing.

Fact No. 2 is that in the , for the first time ever, global trust declined year over year for all four of the institutions tracked—government, media, NGOs and business. The 2018 report was more of the same. Over the past decade, there has been an inversion of trust globally from institutions to individuals, from the status quo to reformers, from official statements to leaked information, from data to personal experience, from politeness to bluntness, from advertising to social media.

Consumers have lost connection with a broad, shared narrative and are turning instead to smaller worlds of influence and guidance. The worst of this has been described as post-truth, but it’s actually post-trust because truth requires a trusted authority to validate it, and that’s what has drifted away.

The issue is not so much corruption and incompetence as it is a lost sense of shared interests. People have come to understand that experts and institutions have their own agendas that don’t always protect or prioritize what matters to people, so they are turning to more intimate connections that offer a greater assurance of shared interests. Influence is now found in intimacy, not authority. Brands must find more intimate ways outside the comfort zone of traditional practices to convey transparency and honesty about shared interests.

Paralleling the shift to smaller worlds is an evolving view of digital technologies. Typically, the future is envisioned as more and more digitally immersed. However, the paradox is that the future is both more digital and more analog. Just as companies are getting comfortable with digital technologies, consumers are demanding more human-scale engagement as well, and not simply as a respite from digital technologies but as the very essence of digital engagement itself.  In effect, consumers want an analog upgrade to their digital lives.

Voice technologies are deepening the appetite for analog interactions. Inherently, voice technologies require a conversation at human scale, thus with the rise of voice technology, analog engagement is the coming interface for digital systems. Consumers are responding in human ways already. Half a million people told Alexa “I love you” in the year after it was introduced. A JWT Intelligence/Mindshare study of U.K. consumers found that 36% love their voice assistant so much they wish it were a real person—context for fact No. 3: 26% of consumers admitted to having had a sexual fantasy about their voice assistant. Nothing is more human-scale than that!

Human touch is everywhere. Sales of vinyl LPs, printed books and Moleskine notebooks are up. Board games, specialty magazines and Fujifilm’s Instax instant cameras are hot. Greenways are the new byways. Podcasts are skyrocketing as are farmers’ markets, food trucks, cafés, festivals and coffee shops. Anxious push-back about technology is accelerating these trends.

Not only do brands have to operate more at digital scale. They have to operate more at human scale, too, and that paradox is uncomfortable.

The growing interest in analog engagement is part of the broader change in spending reflected in fact No. 4. Services accounted for 65.1% of global GDP in 2017, according to the . In the U.S., services accounted for 77%. In China, 56.1%, up from 44.1% in 2010. In India, 48.9%, up from 45.2% in 2010. Services dominate in trade, too.

This is uncomfortable for companies that must figure out how to turn goods into services or add services to goods. Service companies must stave off new competitors by inventing new kinds of value.

Nor will services in the future be the same as before. In its study of U.S. consumer spending on services, McKinsey split growth into experience-based and nonexperience-based services. Far and away, experiences were fastest-growing. It’s not merely services; as the marketplace pivots from experiences as a point of differentiation to table stakes, spending will continue to grow for services that deliver experiences. Add in voice technologies and augmented and virtual reality, and none of this is within the comfort zone of business as usual.

The final fact is best described by the title of one of the most frequently cited papers in the history of psychology, “The Magical Number Seven, Plus or Minus Two.” A literature review of studies on short-term memory, this paper pointed to a convergence of research on seven, plus or minus two, as the maximum number of things people can keep in their heads at any one time while deciding. In other words, human cognitive capacity is fixed at seven, plus or minus two. Yet the amount of information washing over consumers has skyrocketed.

Marketing overload is nothing new, but within the comfort zone of business as usual, marketers have consistently misinterpreted it. The prevailing view is that overload is an opting-out problem of resistance that necessitates stopping consumers from leaving. This overlooks the evidence that consumers love advertising and shopping. Consumers don’t want to opt out. In fact, they want to opt in more, but the ways in which companies force them to engage make it challenging because of finite cognitive capacity. As a result, WPP/Kantar MillwardBrown BrandZ tracking shows brand clarity declining even as brand awareness is up. In other words, consumers are opting in more, but they can’t keep up.

Instead of battling resistance, brands should rationalize and temper what consumers must do to opt in. This is tied to experiences, human scale, intimacy and personalization. All of these dynamics are interwoven and mutually reinforcing. What they add up to is a future of growth in uncomfortable places.

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Have you ever thought about how self-centered that instruction is? You probably haven’t because you realize that you’d be no good to anyone if you’re passed out in your seat due to lack of oxygen. Sometimes we need to help ourselves before we can help others.

As personal branding has become popular, many of us feel the need to own our image and strategically promote ourselves. At the same time, we wonder if it’s right to spend time advancing ourselves or if our time would be better spent helping others.

I recently read an article by fellow professor . Williams lamented that college faculty members are now expected to be promoters. They are asked to push their institutions, their departments, their courses, their books and themselves. 

The notion that self-promotion can become narcissistic and overshadow other priorities is valid; egos easily grow out of control. However, Williams’ argument relies on the same dubious assumption others often make: Personal branding is solely self-serving.

Like the oxygen mask example, the best personal branding is not a decision between helping ourselves or helping others; it’s an opportunity to do both. By helping ourselves, we can better help others.

 The idea of altruistic personal branding becomes more plausible when we recognize that good branding involves more than just communication. When we build our brand, we develop character and gain competencies. We are most valuable to others when we offer real reasons for trust and confidence. 

Throughout my education and career, I’ve often benefitted from the strong personal brands of other people. I also believe the investment I’ve made in personal branding has helped at least a few others.

​​I met Dan, an alum of my college, many years ago when my instructor invited him to speak to our advertising class. Dan had an MBA and was a marketer for a well-known packaged food company. He gave me advice when I was considering an MBA and later lent me instant credibility with one of my MBA program’s leading professors, whom Dan had impressed on a consulting project. When I mentioned to the professor that I knew Dan, he enthusiastically replied, “Any friend of Dan is a friend of mine.” Years later, the professor remembered me and my connection to Dan when I asked him to recommend me to doctoral programs. 

Now that I’m older and more experienced, I believe that others benefit from my personal brand. I do things for them, such as write letters of recommendation and serve as a reference for job applications. Just as I leveraged my mentors’ qualifications, credentials and connections, they use mine to help them advance in their careers. The time I’ve spent building my personal brand has increased my equity and paid dividends to others. 

Interestingly, Dan is now the vice president of marketing for a large retail chain, and he calls me when he’s looking to hire for his marketing department. He probably never imagined that using his brand to help build mine would one day directly benefit him. That’s the nature of enlightened self-interest and airplane oxygen masks. Sometimes we can help others more by first helping ourselves.

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In 1988, Ilise Benun was fired from her job as the operations director for a travel agency. It was her second job out of college. She was furious. “I never wanted to work for anyone again,” she says. “I realized since then that I’m, in fact, unemployable.” With more free time on her hands, Benun visited with her creative friends. She noticed stacks of paper strewn about their desks. Each pile was bursting with opportunity for more business, better marketing and self-promotion. Benun used her newly found free time to help her friends with marketing and bookkeeping, finding enough opportunity under the piles of paper to start her own company. Soon, her client list grew and her status as “unemployable”—at least by anyone else—became a self-fulfilling prophecy.

Benun is author of and founder of , a company that helps creative professionals find “better clients with bigger budgets.” She has kept her business growing by responding to the needs of the market. Very soon, those needs will largely reside in the gig economy.

Currently, , according to Intuit, a number predicted to grow to 43% by 2020. However, most creative professionals—even creative marketers—likely aren’t ready to manage their own business. That’s where Benun comes in. 

Marketing News spoke with Benun about the entrepreneur mindset, how creatives can market their business and how they can prepare for the gig economy.

Q: What’s the most difficult part of getting into the business mindset for creatives?

A: Getting outside of themselves and seeing that what they want isn’t the focus of marketing their services; it’s all about the client. Self-promotion is not about you. It’s a paradox, but the idea is that even the way you answer the question “What do you do?” is not about you. What I like to say to that, for example, is, “I help clients get better clients with bigger budgets.” That tells you nothing about what I do or how I do it, but I’m speaking to a certain type of creative professional who is at a certain place in their process—they want to take [their business] to the next level. 

Q: Are most people ready to run their own business? Should people in full-time jobs start preparing to be self-employed? 

A: I don’t think people are ready. Employed people think they have job security, but I don’t think there is such a thing as job security anymore. Even if you have a full-time job, you could lose it at any moment​. You have to be constantly cultivating your network and building your relationships so that, as things evolve, you know who to call, where to go and how to position yourself for whatever the next thing is—whether it’s a full-time job or a gig. I make a distinction between an employee mindset, where you’re an order-taker, versus a business-owner mindset, where you take responsibility for going after the work you want, as opposed to taking whatever comes along. 

Q: What’s the most important tenet of entrepreneurial thinking for creatives?

A: It’s being ambitious enough to pursue what we want. That means you have to decide what you want, find the people and companies and approach them. You have to not care about rejection because the reality is that most of them won’t want what you have to offer. You’re looking for something better than whoever happens to find you. That is the biggest challenge for people, even people who are successfully self-employed. A lot of people are spoiled by word-of-mouth and see it as a blessing, but when it stops, it is no longer a blessing, and you have no foundation. That’s why taking responsibility for the direction of your business and pursuing the types of projects and clients that you want puts you in a much stronger position. You’re not dependent on something outside of you. 

Q: So it’s marketing. It’s doing the job you already do, but doing it for yourself. That has to be a hard concept for some to grasp. 

A: It is, because you’re too close to it. And that’s why my business exists, because I’m not close to it. I can see who might benefit from your services. I can see what your strengths and weaknesses are, what needs to be shored up, what language might make sense based on who you are and what you want to pursue. 

Q: What is the first step people can take toward this way of thinking? 

A: Go to networking events in research mode. A lot of people hate networking because they imagine that it’s a situation where people are just foisting their business cards on other people, but it’s not. It’s developing relationships and learning about what the world needs. If you go to a networking event in research mode, you see that this person needs this, and this other person needs that. Then you can be responsive to the needs of the market.

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Twitter is a minefield of insults, gallows humor and political arguments, but it’s also a gold mine for marketers looking to connect with some of the world’s brightest minds. As easy as it may seem for marketers to say the wrong thing and offend thousands of people simultaneously, it’s as easy—if not easier—to say the right thing and gain access to the best of Twitter’s 330 million monthly active users.

Marketing News spoke with three social media professionals who weighed in on what career marketers should do and what they should avoid on the quick-fire social media platform. 

3 Things to Avoid

Posting Without Thinking

Think before you hit send, says , owner of social media and digital marketing agency Kruse Control. Many people—even those who list their job in their Twitter bio—simply don’t think before, during or after they tweet. Many users post gross images, inappropriate videos and offensive thoughts on Twitter, she says, all of which can be gravely damaging to a marketing career.

“I’m not saying people shouldn’t have their personal opinions about things politically or otherwise, but what you say and do online speaks for you,” she says. “A lot of people don’t realize that because it’s just the click of a button. But the reality is, you can see [the Twitter post] for the rest of your life.”

Twitter posts can bubble up at the worst possible moment—many are archived by the Library of Congress—and take a marketer from candidate for a new job to the rejection pile. “Tread lightly,” Kruse says.

Only Talking ���������t Yourself​

Twitter is like a cocktail party—most people hate listening to people who only talk about themselves. 

, a social media strategist and CEO of Tatu Digital Media, says using Twitter solely for self-aggrandizement is one of the biggest mistakes professionals can make. Instead, marketers should join other conversations and share other people’s posts, especially those who are valuable for their marketing network. 

“Respecting the intelligence of other people and sharing their information aligns marketers with the people they respect,” Fouts says. “When they do that, they can really raise their status by associating with people who are super smart.”

Speaking as an Authority If You Aren’t an Authority

Don’t be a know-it-all, says , social media coach and co-founder of Rocks Digital. If a marketing professional, perhaps feeling intimidated by the experience of other marketers, speaks like an authority on Twitter when he’s more of a dilettante, other marketers will see through his pretentiousness, Duty says. Wanting to be an influencer is a great goal, but influence can’t be forced, she says. Be open to learning new information before bestowing it. 

3 Things to DO

Focus on Your Passion

It may be cliché, but marketing professionals should post about their passions to establish themselves as  thought leaders in areas they truly care about, Kruse says.

“Let that guide you for how you want to be seen, and establish yourself as an expert or a thought leader,” she says. “Volunteer to write content around it, certainly, but also volunteer to speak at [events] or contribute to blogs of companies that you admire.”

A lot of smart companies will try to poach these Twitter thought leaders, Kruse says, because their presence makes the company look like a marketing thought leader, too. 

Strive to Learn

Amid the insults, arguments and cat posts are a lot of posts by brilliant people. The smartest marketing professionals on Twitter learn from them, Fouts says.

Marketing professionals should think of Twitter as a place of professional development, a place they can learn from leaders in their field. Marketing professionals can also help others learn by reading and sharing these insights, which will likely help their own brand.

Reach Out Within Your Range

Marketers should focus on connecting with influencers who are within reach, Duty says. For example, Twitter users with 500,000 followers may not respond, as their notifications are likely crowded. However, someone with 50,000 followers may respond, which can have immense value.

“[They can be] someone to look up to, ask questions of and follow,” Duty says. “Someday, they can develop the relationship, and they too will be an influencer. That’s how [marketers can] grow their reach on Twitter.”

Duty used this method to increase her Twitter following. Her @LissaDuty account has 30,700 followers, but those followers didn’t appear overnight. Duty identified three influencers who had a big reach on Twitter and developed a rapport with them on the platform. When their influencer status grew, Duty’s did, too. 

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“It feels up, but it’s not,” explains NCMM executive director Thomas Stewart, who points to historical Middle Market Indicator data showing a definite cadence in the transactions. “Those charts are as predictable as a marathon runner’s heartbeat. Just constant rhythm. … What’s different is there is [now] a lot of money out there looking to make deals. That means two things: Price is going up and the structure of the deal has changed a little bit. Less banks, more equity.”

Regardless of the cyclical evolution, NCMM research shows that 1 in 5 middle market companies makes an acquisition every year, while 1 in 20 sells outright or divests a portion of the company. 

Though less frequent, sellers often have stronger impetus to act. Many times a middle market business is a family operation. If there is no apparent succession plan, and the owner decides to exit while the getting’s good, often the decision to divest partial ownership is tied to an owner’s desire to liquidate a portion of the long-term investment they’ve made in a business over time. Whatever the motivations, a sale can rise abruptly. In many cases people don’t sell until they’re propositioned, Stewart says.

Common reasons to buy include acquiring new customers or capabilities. Interestingly, many respondents view expansion not as a luxury available solely to businesses enjoying an abundance of cash flow in the best of times, but as a necessary component of survival. Stewart says there’s an acute fear of being overshadowed and boxed out by growing competitors if businesses stand pat. “A lot of people told us that they felt that they had to get bigger to compete with consolidation,” Stewart says.

If fear defines the beginning of the purchase cycle, exuberance colors its final stages. Of companies that do participate in the acquisition phase, 60% report buying is vital to their growth strategy and signal they expect a deal to account for 26% of future growth, which Stewart says comes from a mixture of “data and hope.”

“That suggests that [respondents] are hoping for more than bolt-on sales, that they’re hoping for positive synergies. One and one is going to make 2.3,” he says.

The eye-popping growth numbers paired with an appetite for expansion in the sector might suggest that middle market execs are old hands at deal-making, but their responses say otherwise. Forty-one percent of companies that reported completing a purchase within the past three years say they had limited experience in acquisitions, and almost a third (29%) were participating in the M&A process for the first time. This inexperience can cause missteps that cut into the value of the deal, says Ed Kleinguetl, a transaction services partner at Grant Thornton LLP, which contributed to the report.

“There are a number of novice mistakes,” Kleinguetl says, such as the misconception that the acquirer and acquired businesses are functionally similar. “Even if it is a common business, there are many dynamics that can create differences,” he says. “First among these is the overall cultural alignment, which is often a reflection of the owner-operator.” Further, some businesses are highly disciplined with strong systems and controls. However, many middle market companies are run by gut feel and intuition. 

Overcoming these obstacles begins with a checklist. Employees, health plans and operations all need methodical synchronization. Even more important is prioritizing plans to retain top talent and customers post-acquisition and developing a communications plan.

“Communication to customers must be proactive to thwart nimble competitors who see an acquired company as distracted and its customers as prime targets for poaching,” Kleinguetl says. “The same holds true for key employees. The old adage is true: In the absence of communication, people create their own realities. It’s better to proactively communicate to each key stakeholder group.” 

Of course, all this maneuvering presupposes middle market buyers and sellers have identified a target. Yet, here too, amateurs operate. The report finds that middle market sales searches are helmed most often by internal advisers. Only a third of buyers consult outside law firms, and fewer request help from investment bankers. Sellers are even less likely to make use of external experts. Though logic would dictate an experienced guide gives a buyer or seller an advantage during the search and negotiation process, Kleinguetl says would-be dealmakers often operate illogically and are less likely to accept help even if an expert is consulted.

“In likely half the cases where an owner is involved, there is a gut feel or intuitive decision to go forward with the deal,” he says. “Sometimes it is hard to overcome these types of decisions, which have emotionally already been made. ‘Buyer beware,’ is always sage advice.”

Expertise is particularly valuable when considering valuation, which can be difficult to assess and laden with emotional baggage, yet paramount to any deal being struck. Forty-one percent of buyers report they find it very difficult to value a business they are purchasing, and 43% of sellers say the same thing about their own business.

“In many cases, the valuations can be off because of optimistic estimates of synergies or deal value to the acquirer or unforeseen market conditions,” Kleinguetl says. “There is a correlation between the depth of initial diligence and the ability for a deal to deliver the anticipated results. … As an example, one client closed a transaction, and a few weeks later discovered the roof in a distribution center had to be repaired—an unforeseen $1 million expenditure. The problem is that just looking at financial statements and tax returns in a data room will not find the leaking roof, unless the target discloses it.”

Finally, motivated buyers and sellers might encounter a longer process than they had anticipated. Most deals can be completed in under a year, but becoming “deal-ready” is a multiyear process.

“Deal readiness is an interesting concept,” Kleinguetl says. “The reality is that most buyers do not like to see ‘lumpy’ results in a target’s history. They like the proverbial upward growth history and implied trajectory. If the plan is to sell a company, it is important to focus on performance quickly and maintain a continuous improvement mindset.” 

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“I opened up the cupboard, and it was a mess,” he says. “The whole-peeled tomatoes were on the top shelf. Spaghetti sauce was on the next shelf. You couldn’t even find the tomato paste, and tomato sauce was on a different shelf yet. I asked my wife, ‘Would you mind if I reorganized your cupboard?’”

Big mistake.

“She told me I should pick up golf or go back to my genealogy, but I needed to get the ‘expletive’ out of her kitchen.” Greenspan opted for the latter. Long an enthusiastic chronicler of his family’s history (he first sketched a family tree as a teenager in 1965), Greenspan devoted the next month to exploring the lineage of his lone unmapped grandparent, only to bump into an online researcher from Buenos Aires tracing the same person. It wasn’t long before the pair channeled their efforts to uncover a probable familial relationship between them, and though they succeeded in linking their respective ancestors to the same village and set of surnames, they fell short of producing a single connecting historical record—then considered the gold standard of genealogy.  

The search normally would have stopped there, if not for a burst of inspiration on Greenspan’s part. “It dawned on me that I could use molecular biology,” Greenspan says, as if it’s something he’s done his whole life. Except Greenspan is not a molecular biologist. He doesn’t even have a general science background. His bachelor’s degree is in political science, and at the time he’d spent the bulk of his life selling photographic film. But he was determined. And he’s a voracious reader.

Greenspan remembered a pair of studies he’d seen that used DNA to confirm suspected lineages. In 1997 researchers analyzed the Y chromosomes of Jewish men and found that members of , or Jewish priests who claim to be descendants of Moses’ older brother Aaron, possess distinct genetic traits that suggest they share a common male ancestor who lived approximately 3,000 years ago. A separate study published a year later linked the modern-day descendants of Sally Hemmings to Thomas Jefferson, seemingly that Jefferson had fathered some of Hemmings’ children. Perhaps, Greenspan thought, he could use the same methods to search for a genetic link between himself and his Argentine counterpart. He also wondered if this quest could form the foundation of a business model. He reached out to Dr. Michael Hammer, author of the Cohanim study, with a plan to commercialize DNA ancestry tests. 

Greenspan would sell the tests, and Hammer and the University of Arizona would perform the analysis. The partnership proved so successful that Greenspan eventually opened his own lab company in Houston to increase processing volume. Nearly two decades later his company, , offers three types of genetic ancestry tests through a subsidiary, , and performs genetic analysis for a host of competitors.

Greenspan’s idea captivated genealogy enthusiasts and has been copied by reams of competitors, some of which have scaled enormously. , published by Credence Research last May, found that the market for direct-to-consumer genetic testing topped $70 million in 2015 and is expected to grow nearly fivefold to $240 million by 2022. AncestryDNA, arguably the most visible player in the consumer ancestry space, sold an estimated 1.5 million units of its at-home testing kit over the 2017 Black Friday weekend.

Part of the industry’s growth is attributable to technological breakthroughs. Greenspan’s company began by offering Y-chromosome testing, which traces only direct male lineages. The subsequent development of a test for autosomal (nonsex chromosomes) DNA allows geneticists to make links between distant relations. This broader test is largely what backs today’s ancestry offerings.Greenspan’s idea has also evolved to encompass products he never dreamed of offering. 

The same genetic material consumers submit to determine their ancestry can yield troves of information about a person’s physical traits. 23andMe, a chief rival to AncestryDNA, whose Health + Ancestry Personal Genetic Service was one of Amazon’s top five 2017 Black Friday items, offers kits that can reveal predisposition to genetic diseases such as Alzheimer’s and Parkinson’s. Other competitors are pitching DNA testing as a means to customize and enhance lifestyle aspects. Everything from optimal sleep schedules to wine preferences, some say, are written in a person’s DNA and can be sussed out with a simple test. If consumers could harness and apply insights about their biology captured in their own DNA, this line of thinking goes, their potential for self-improvement would skyrocket. 

With promises like these, many believe DNA insights are poised to become a great driver of consumer behavior. “I knew that DNA testing was going to be a big deal. … But I didn’t realize it was going to become ubiquitous such that every single person would eventually end up with a DNA test, just as they will end up with a cellphone,” Greenspan says.

That’s still a big if, though. Even as the field of consumer genetics approaches widespread cultural resonance, experts are questioning the science behind some of the products. And as DNA-collecting companies start to treat genetic information as they would any other piece of consumer data, government watchdogs are taking a closer look at the practice. These pitfalls, if not properly navigated, carry the potential to squash the market for consumer genetics just as it’s on the precipice of a breakthrough. Thus far, the threats aren’t scaring away any opportunists. 

Consumer DNA testing for the world’s largest for-profit genealogy company, Ancestry (parent company of AncestryDNA), works like this: Consumers order collection kits online, deposit a teaspoon of saliva into a plastic tube, mix it with a bonding agent and mail it to a laboratory for analysis. As they await their results, which are typically delivered in four to six weeks, they can search for the origin of their last name or begin mapping family trees using traditional genealogy methods on the company’s website.

Unlike Greenspan’s initial products, AncestryDNA doesn’t purport to link individuals with specific ancestors. Rather, it provides estimates of a person’s ethnicity, showing the regions of the world where their ancestors once lived. The service also checks a person’s sample against the 6 million users stored in its DNA database to determine whether there are any familial links between customers.

That ability to offer consumers a profound sense of self creates a unique marketing proposition that has allowed the service to thrive, says Ancestry’s vice president of U.S. marketing, Caroline Sheu. 

“DNA testing is no longer a niche interest, it’s a mass consumer market with millions of people wanting to experience the emotionally powerful, life-affirming discoveries that can come from simply spitting in a tube,” Sheu said via e-mail. “Our product is in a cultural and human space that very few brands are in. We’re pairing science and technology with creative, emotional marketing strategies to spark a new dialogue focused on the interplay of genetics and culture.”

Of course, it doesn’t hurt that Ancestry enjoys a $175 million marketing budget to push that message. A year ago, most of its marketing dollars were spent on television advertising, but with the arrival of former Johnson & Johnson exec Vineet Mehra as CMO in early 2017, the company deployed a new strategy that saw heavier investments in programmatic, social, influencer and mobile categories. Mehra’s onboarding was quickly followed by the appointment of Droga5 New York as Ancestry’s lead creative agency.

Ancestry’s heavy marketing investments underscore the high-stakes jockeying taking place in the ancestry market. DNA databases are at a premium, not because of what they can tell researchers about anthropological patterns, but because of what they say about consumers’ lifestyle traits.

Consider the following set of questions Ancestry asks as part of a beta project to learn about shared genetic traits:

• Are you more of an extrovert or an introvert?
• Are you a vegetarian?
• Do you like to go to sporting events?
• Do you play a musical instrument?
• Do you burn when you don’t wear sunscreen?

Marketers will at once grasp the relevance of these surveys. The data gathered can be used to build personas and inform campaigns. But what happens when these personality traits are linked to DNA profiles? The answer is found in the field of genomics, which considers how relationships throughout the entire human genome influence personal development, rather than searching for a specific gene that determines a certain trait.

“Genomics is the next major consumer market, and it will change all of our lives,” Sheu wrote. “We are leading this revolution and provide opportunities for anyone who wants to play a key role in building this new frontier.” 

Genomic testing was the bread and butter of 23andMe when it launched in 2008, offering clients a battery of screenings to determine their propensity to develop more than 90 genetic-related conditions, such as migraines and baldness. And while that remains true today, a 2013 ruling by the Food and Drug Administration curtailed several of the company’s offerings, limiting its scope and confining it more narrowly to the ancestry space. That changed last April when the FDA revisited its 23andMe decision and allowed the company to market 10 tests for inheritable genetic conditions. Following that high note, 2017 closed with the news that 23andMe is embarking on one of its most ambitious projects yet: offering 1.3 million current customers the ability to participate in a weight-loss study searching for a link between genomes and diet success. 

After initially agreeing to answer questions for this story, 23andMe communication manager Christine Pai stopped responding to repeated requests for comment.

The sum of these moves suggests the market for consumer DNA tests is moving beyond ancestry into the realm of health care-adjacent products. 23andMe might be first, but it won’t be alone for long. Ancestry’s Sheu wrote there is “nothing to report today” in regard to potential steps her company might take into lifestyle and wellness genomics, but she also admits the company is looking at ways to integrate health information over the long-term, a sentiment that is echoed by Ancestry’s chief privacy officer, Eric Heath. “We have expressed interest in the health space,” Heath says, “but we are not doing that now.”  

As genetic testing companies fight for market share, a promising model is emerging for startups to enter the DNA insights space. Helix is billed as the world’s first DNA app store. For $80, users can sequence their DNA and store it in the Helix market. Once their genetic code is uploaded, users can pay individual apps to scan bits of their DNA to produce specialized insights. Helix now offers ancestry mapping de rigueur, but the full range of apps display variety normally found in shopping malls and range from serious to silly. One fitness tracker creates workouts customized to users’ DNA readings. A family-focused app lets mothers test the amount of a certain omega-3 fatty acid present in their breast milk. The most fanciful offering eschews the personal improvement pitch altogether. It’s a fashion app that knits scarfs reflecting the unique sequential pattern formed by the four base enzymes found in users’ DNA. 

“The Helix.com store was created to give each individual a choice in how they engage with their DNA,” says Elissa Levin, director of policy and genomic services for Helix. “For some, they only want to know the health-related insights. For others, they just want to start with something fun, like ancestry or a personalized scarf, and then at another point in their lives, they may have a need or newfound interest in accessing insights that tell them more about their health or nutrition.” 

Helix formed three years ago using a $100 million grant from Illumina, a global leader in DNA sequencing. Many business metrics are still being kept secret. Levin won’t say how many users have purchased apps on the market, nor how large Helix’s database of sequenced DNA samples is. What she will say is the Helix store currently lists more than 30 products for 15 different partner companies.

One such partner is Exploragen. Its debut app, SlumberType, uses Helix’s sequenced DNA to determine what it claims is a person’s optimal sleep schedule. Society has long promoted the concepts of morning people and night owls, believing certain people are more suited for activity at different times of the day. Exploragen’s value proposition lies in addressing the uncertainty over these distinctions on an individual basis.

“There are many DNA variations that are thought to be important in influencing how well or how long a person sleeps,” says Exploragen CEO Ronnie Andrews. “���������t 30% to 40% of the variance in people’s sleep patterns is determined by DNA while the rest is influenced by other factors such as age, environment and lifestyle.”

SlumberType needs access to DNA to read gene variants associated with certain sleep traits, such as sleep onset latency, or how long it takes someone to fall asleep after shutting their eyes. From there, it classifies people into one of four categories—roosters, bees, fireflies or owls—and provides insights into how best to plan a day (and night) around this category. Like Levin, Andrews won’t say how SlumberType is performing, other than to say he’s excited by the response. Exploragen plans to release a second app in 2018, which will allow people to track how their bodies respond to caffeine. After that, Andrews says Exploragen is still working on its roadmap for the ensuing years.

“Our goal is to develop apps that are not only educational but engaging as well with actionable tools and insightful features that keep customers continuously exploring their biology and habits,” he says. “Consumer genomics is at a tipping point, where it becomes a normal, everyday thing to query your DNA for answers that can positively impact your life. Today, the question might be: Where did my ancestors come from? Tomorrow, it might be: What should I have for lunch, or how much coffee is too much coffee?”

There’s a flip side to the proliferation of these genomics tools, however, that marketers will need to address. As genomics applications trickle ever closer to informing consumer decisions, their scientific legitimacy is attracting skepticism. Put bluntly, there’s a whiff of pseudoscience emanating from some of the more outrageous offerings that threatens to torpedo consumer genomics’ budding trajectory. Helix was a target of derisive skepticism in October when Eric Topol, a prominent cardiologist, took to Twitter to add up the cost of Helix store apps he believes lack sound science or convincing data. “Total cost = $1,900; Value = 0,” he tweeted.

Three days later, during an episode of “The Late Show,” comedian Stephen Colbert mocked Wine Explorer, an app sold on Helix that recommends wine based on genetic analysis. “I’m getting notes of almond, black currant and total bullshit,” he intoned while sniffing a glass of red wine. 

Levin is aware of the image problem, which she says stems from people confusing serious apps with ones meant for entertainment. She also vouches for the science behind Wine Explorer.

“[The app maker] performed a research study to explore variations in taste and smell genes along with self-reported food preferences,” she says. “The outcome was an algorithm that can take these factors and tell you the characteristics of wines that suit your genetic palate. Wine Explorer not only highlights these preferences but then connects you with unique wines that meet those preferences. It’s a little bit genetic, and a lot of fun—not to mention a great way for people who are not yet motivated to learn health insights to access the power of their DNA.” 

But soundness of principle is only the second-biggest obstacle impeding widespread adoption of consumer genomics. By far, the most significant concern is privacy. Questions about user privacy have existed for as long as DNA testing has been commercially available. When Greenspan brought the first genetic ancestry test to market, consumers peppered him with dozens of concerns about the fate of their DNA sample. Indeed, it’s hard to imagine a more sensitive type of data than DNA. Just using consumer DNA for its marketed purposes could expose deeply sensitive, legally protected information such as race and health status. And though providing salvia samples for diagnostic purposes would trigger Health Insurance Portability and Accountability Act protection, submitting spit tests to obtain ancestry or other genetic information is not subject to the same legislation.

This allows consumer genetics companies to treat DNA like typical consumer data, which they can sell to third parties in anonymized, aggregate form. 23andMe has two such research partnerships with drug companies Pfizer and Genentech, and Ancestry has a similar agreement with Calico, a longevity-focused subsidiary of Google parent company Alphabet. Ancestry’s Heath notes that individuals can opt to not include their DNA in the aggregate samples and still use the service. He also says that aggregate DNA-sharing agreements are not the company’s top priority. 

“Generally, [third parties] come to us,” Heath says. “Unlike other DNA testing providers, [selling aggregate data] is not a main source of revenue for us. This is opportunistic engagement with companies or institutions that are researching important aspects of genetic science that, if they fit within the protocol, we will entertain.” 

Heath is also adamant that there are some parties that Ancestry refuses to sell to: insurers, employers or third-party marketers, for example. His assurances, as well as those given by competitors, have yet to be enough for Sen. Chuck Schumer, D-N.Y., however. 

In November 2017, the Senate minority leader held a press conference where he pressed the Federal Trade Commission to investigate the privacy policies of consumer DNA kits and ensure policies are fair and transparent.

Heath believes Schumer’s actions were unnecessary. “I think Sen. Schumer’s comments may not have been fully researched because we’re already doing a lot of what he was hoping to get the FTC involved in doing,” he says. “Our brand has a pretty high degree of trust, and we are giving users control of their data. … We’re meeting our customers’ expectations, we’re meeting the legal requirements, and we’re meeting the market’s expectations as well.”

Nevertheless, Ancestry updated its privacy statement two weeks after Schumer’s press conference. FTC spokeswoman Juliana Gruenwald declined to confirm whether the agency would act on Schumer’s request, citing organizational policy not to comment on the existence of investigations. But she referred to a blog post that highlighted a 2014 settlement with the producer  of genetically customized nutritional supplements who failed to protect personal genetic information, among other transgressions.

Amid the delicate landscape of consumer data, there’s at least one company that has struck out the other way: Greenspan’s Family Tree DNA. The same day Schumer called for tougher FTC standards, Family Tree DNA unveiled a media campaign vowing to never sell consumers’ genetic data to other entities. Greenspan isn’t optimistic about the message’s ability to drive business, though. “I don’t think it matters, unfortunately, either way,” he says.  Then why do it?“I think it’s an important message that needs to be sent,” he reasons. He also believes the campaign will position him to be left alone should the FTC or Congress come prowling around the industry.

Perhaps he has shrewdness encoded in his genes. 

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