Selective demarketing – makes sense?

Selective demarketing is a marketing strategy aimed at purposefully reducing demand for certain products or services in order to solve certain problems or specific Set to reach. This can e.g. This can be the case, for example, with products or services that have a negative impact on the environment, pose health risks or cause problems through overproduction or overdemand. Your Coaching Institut Frankfurt can advise you in more detail.

An example of selective demarketing is the targeted restriction of advertising for tobacco products or the imposition of high taxes on sugary drinks in order to reduce their consumption. Offering alternatives such as substitute products or healthier alternatives can also be part of a selective demarketing strategy.

Selective demarketing can be challenging for businesses, as it can be difficult to downsize on specific products or services without damaging the brand or the business as a whole. However, in some cases it may be necessary to demonstrate social responsibility and sustainability or to reduce negative impacts on the environment and society.

Target group focus – Demarketing

What is it used for?

Selective demarketing is used to specifically reduce demand for certain products or services that are seen as problematic. It can be used for various reasons such as:

  1. To demonstrate social responsibility: Companies can use selective demarketing to demonstrate their social and environmental responsibilities. For example, you can restrict the sale of products that have negative impacts on the environment or health to demonstrate their sustainability.
  2. To comply with legal requirements: In some cases, governments may impose restrictions on certain products or services. Selective demarketing can help meet these requirements and avoid fines or other legal consequences.
  3. To improve the company's image: Companies can use selective demarketing to improve their image and credibility. By promoting environmentally conscious and health-promoting measures, they can gain the trust of their customers and show their commitment to society.
  4. To adapt the offer to customer needs: Selective demarketing can also be used to adapt the offer to customer needs. For example, companies can limit their product range in order to concentrate on their core competencies and use their resources more effectively.

Overall, selective demarketing can be a useful strategy to demonstrate social responsibility and reduce demand for problematic products or services.

demarketing management

Demarketing management refers to the planning, implementation, and control of marketing strategies aimed at reducing demand for a specific product or service. Unlike traditional marketing, which aims to increase demand, demarketing management aims to purposefully decrease demand to achieve specific goals.

Demarketing management can be used in various areas, e.g. B. in health care, environmental protection and traffic planning. Demarketing management can be used, for example, to reduce the consumption of tobacco products, sugary drinks or environmentally harmful products.

Demarketing management includes a variety of strategies, such as limiting advertising and promotions, imposing taxes or levies on certain products, raising awareness and education about the negative effects of certain products or services, and promoting alternatives.

Some topics directly related to demarketing that you might be interested in:

The aim of demarketing management is to reduce demand for problematic products or services while raising consumer awareness and encouraging them to choose alternatives that are more environmentally friendly, healthier or more sustainable. Demarketing management can help demonstrate social responsibility and sustainability and promote people's health and well-being.

​Based on 20 years of experience in success-oriented customer management in connection with the latest findings in marketing research, we at TRANSTECHTURE have one systematic demarketing approach developed for the management of deficient customer relationships.

Not every customer is a good customer – demarketing

Our demarketing management let yourself integrate seamlessly into existing marketing strategiesto ensure ex ante that potentially loss-making customers are not approached and to ensure ex post that loss-making customers are no longer addressed and existing loss-making customer relationships are systematically reduced. In this way, we support our partners in significantly increasing the efficiency and effectiveness of their marketing activities.

Consonance of Marketing—Demarketing

​Unwanted customers, so-called loss-making customers in the meaning of selective demarketing, are unprofitable, strategically unimportant customers.

​under selective demarketingwe understand the targeted management of demand from non-target markets and deficient customer relationships with the aim of optimizing the efficiency and effectiveness of the entire customer base. As part of the With selective demarketing, we align aggregate demand more closely with the value proposition. In doing so, we avert the dangers associated with possible customer exclusion (e.g. shitstorm) from the company.

Phase model of selective demarketing

Demarketing in three phases

The approach we have developed includes three phases:

​Phase 1: Analysis + Diagnosis

Phase 2: Goal formulation + planning

Phase 3: Execution + Competency Development 

Analysis and Diagnosis – Demarketing

​The Phase 1 reveals the extent of deficient customer relationships in order to unmask the actual earnings effects of these relationships. Furthermore, all existing marketing implementations are subjected to a diagnosis to reveal the extent to which customers from non-target groups are also addressed in addition to customers from desired target groups.

​Central questions that need to be answered in phase are:

Who are the loss-making customers? 

How many loss-making customer relationships are currently in the entire portfolio? 

What effects on earnings do loss-making customers have?

What activities is marketing already undertaking to ensure a targeted reduction in unwanted customer relationships?

Once the questions have been answered, the demarketing goal formulation and, based on this, appropriate planning can be carried out in the second phase.

Formulation and Execution – Demarketing

​In Phase 2 is from the projectteam, based on previously defined quantitative and qualitative customer portfolio goals, developed a demarketing strategy. In addition to defining the demarketing process steps, this includes specific measures and milestone planning. The goal-adequate adaptation of the UX forms the guideline on which the corresponding project is basedteam oriented throughout the process.

Demarketing – development and execution

Phase 3 follows Goethe's motto: “It is not enough to know, one must also apply; it is not enough to want, one must also do”, which is why the finale third phase of the demarketing management process focused on an agile implementation of the previously developed demarketing measures. In concrete terms, this means that in-house demarketing skills are built up in 14-day sprints, while the implementation of the demarketing measures is accompanied by experienced demarketing experts.

​In every phase of the process, but especially during the implementation of selective demarketing, there is a to ensure complete compatibility with applicable law and company principles. We have developed a marketing ethical reflection model specifically for this purpose. The multi-stage reflection model is based on the interaction of TRANSTECHTURE's own demarketing management experience and renowned marketing experts in conjunction with scientists from the fields of economics, law and Ethik developed. Based on a stage-gate approach, it is continuously ensured that all these activities are carried out in accordance with the highest marketing ethical and legal standards. Also read our article on the topic Coaching trends in 2023.

What is demarketing and how is it different from traditional marketing?

Demarketing is a concept focused on reducing demand for a product, service, or idea. Unlike traditional marketing, which aims to increase demand, demarketing aims to deliberately reduce demand to meet specific goals.
Demarketing can be used to reduce consumption of products or services that are harmful to the environment, unhealthy, or ethically unethical. Demarketing can also be used to reduce resource consumption or to regulate consumption when it causes bottlenecks.

When to use demarketing and what goals can it achieve?

Demarketing can be used in different situations and industries. Here are some examples of when demarketing can make sense:
To reduce the consumption of polluting products.
To regulate the consumption of scarce resources.
To reduce the consumption of harmful products.
To reduce the consumption of alcohol, tobacco or drugs.
To reduce demand for certain products or services when they result in resource congestion.
Demarketing can achieve several goals, including:
Reducing consumption of harmful products or services.
Regulating the consumption of resources to avoid overload.
Increase appreciation for resources and the environment.
Improving the company's image by acting responsibly.
Creating long-term customer loyalty through ethical behavior.

Which companies have successfully used demarketing strategies and how have they benefited?

Some examples of companies that have successfully used demarketing strategies include:
Patagonia: Patagonia launched a demarketing campaign to convince customers to repair and keep using their old products instead of buying new ones. This campaign has boosted the company's image while helping to reduce consumption.
Toyota: Toyota has launched a demarketing campaign to reduce fuel consumption. The company has developed and promoted hybrid vehicles that use less fuel and are therefore more environmentally friendly. This campaign has helped improve Toyota's image while reducing fuel consumption.
Coca-Cola: Coca-Cola has launched a demarketing campaign to reduce the consumption of sugary drinks. The company has expanded its product range to include sugar-free alternatives and encouraged its customers to consume less sugar. This campaign has helped improve Coca-Cola's image as a responsible company while reducing the consumption of sugary drinks.
Overall, companies that have successfully deployed demarketing strategies have benefited from being perceived as responsible and environmentally conscious businesses. By reducing the consumption of harmful products or services and regulating the consumption of resources, they have also helped build long-term customer relationships and improve their image.

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