Warren Buffett doesn’t profess to be a marketing guru, though he is undeniably well-known and respected as a business magnate. Nonetheless, the philosophy that has stood Buffett in such good stead over his decades in business, enabling him to amass a fortune, also offers some striking lessons for marketers.
Warren Buffett makes no secret of his philosophy — in fact he willingly shares it.
Don’t get caught up in the day-to-day ups and downs, he advises. Focus on the long term, and stay the course rather than reacting to every short-term fluctuation that comes along, up or down. When considering any kind of investment, Warren Buffett looks for underlying fundamentals — the potential for long-term strength and growth. Then he allows his investment to generate results.
No expectations of instant gratification, no rush to discard just because every day isn’t a growth day.
Instead, What do Many People Do?
Using the stock market as an example, Buffett notes how often investors over-react. When stock prices are going up, everyone wants in. When prices drop sharply, everyone panics and sells their shares. But history has shown repeatedly that the stock market consistently produces positive returns over the long term.
The most recent "Great Recession" is a case in point. Stock prices plummeted by half in 2008, and there was a mass exodus. Many people were desperately cashing out their stock shares, fearing further drops. Yet, here we are seven years later, and the market average has rebounded spectacularly — in fact, is higher now than before the crash. People that panicked and sold off their stocks suffered great losses, whereas those who rode it out are now better off than ever.
Reactive Thinking is a Poor Business Practice
Consider your marketing strategy. Over-concentration on your day-to-day analytics can drive you to make the same mistakes Buffett describes in investing. Not receiving the results you want yet? Oh, no! We have to change our strategy. Results better than expected? Drop everything else and do that one thing. Instead of consistency, you’re all over the place like a grasshopper, with a “strategy” that is no longer strategic, your plan fallen by the wayside.
That’s a tremendous waste of resources. You’re always looking backward instead of forward, and you run the very real risk of completely confusing your marketing audience. Who are you? How are they supposed to believe in you and your products or services if your message is garbled?
Think Long-Term
You invested a lot of time and skill developing your marketing strategy, so you have to give it a chance to work long-term. Of course you should monitor and analyze your results data, because you do want to make carefully-considered corrections along the way. Sometimes you might even need to act quickly. But it’s considered adjustments, not panicky reversals, that keep you on course with your plan.
Don’t make decisions based on what is temporarily hot or cold. Keep your eyes on the prize, as the saying goes — the goals you have established for your business and your marketing. Persevere. And be patient, hard as that may be.
In a letter to Berkshire Hathaway stockholders last year, Warren Buffett said, “Games are won by players who focus on the playing field — not by those whose eyes are glued to the scoreboard. If you can enjoy Saturdays and Sundays without looking at stock prices, give it a try on weekdays. … Forming macro opinions or listening to the macro or market predictions of others is a waste of time. Indeed, it is dangerous because it may blur your vision of the facts that are truly important.”
Are you listening, marketers?
