Marketing is one of the most misunderstood words in the business
language.
How often do you see "marketing" used when people actually mean
advertising, public relations, or sales?
Given all the changes that have taken place in the business environment,
particularly as we move into the digital age, is marketing still a
concept that is relevant?
And what does marketing actually mean?
The marketing concept (originally described by Theodore Levitt in the
early '60s) says that "the objective of every company ... should be to
focus on the customer's present and future needs and wants, thereby
winning his or her satisfaction and loyalty".
Since that time, the practice of marketing has wound its way through a
number of concepts and adaptations - product management, strategic
marketing, market segmentation, and more recently one-to-one marketing,
and interactive marketing.
Are these just fads, or are they valuable adaptations of the original
marketing concept? And is the original concept still valid as we move
forward in the 21st century?
In spite of its evolution, marketing still remains a much misunderstood
concept.
I am sure that everybody can identify businesses, perhaps even their
own, that suffer from one or more of the following syndromes:
- Confusion between sales and marketing - the sales budget rules
- Marketing dominated by market research - the numbers dictate the
strategy
- "Marketing" happens in the marketing department - no one really knows
what "they" do
- We have the best product (or service) - we don't really need wasteful
marketing expenditure.
So, with all this confusion and apparent difficulty in coming to terms
with marketing, perhaps it is an outdated concept after all, right?
The answer is no, no, a thousand times no.
In fact, the concept of marketing becomes more and more important to
business as customers become more discriminating, as competition
increases in most major markets, and as we move to the concept of
competing globally.
The reason for this is that marketing is actually a philosophy, a
philosophy that can be seen as the driving force behind virtually all
successful businesses.
In these successful businesses, the philosophy of marketing manifests
itself as an attitude, a way of looking at the business world that is
not about making widgets and counting journal entries.
It's a focus on the customer, the market, the world beyond the microcosm
of your business.
It's the desire to see the market and your product or service offering
the way your customer does.
It's also the desire to make sure you really like what you see.
Marketing and market-driven economies go hand-in-hand. It has been
called "customer sovereignty".
With the resurgence of market driven economies throughout Asia, and the
advent of the information age, marketing is alive and well and
continuing to evolve ... albeit with some of the adaptations outlined
earlier.
So what is it about the philosophy called marketing that makes it
relevant to the concerns and issues facing businesses today?
Throughout the '90s, the five leading management concerns have been
noted as:
Consolidation of competition (fewer and larger players)
As we move into 2001 and beyond, we could add:
The impact of e-business
the same direction)
Let's consider how the marketing philosophy is relevant to each of these
contemporary management concerns.
Consolidation of competition makes it more important than ever for us to
invest some time in understanding our competitors and anticipating their
moves.
Marketing requires us to understand how our customers, or potential
customers, view us in relation to our competitors.
You win by deciding which customers you would like to have and ensuring
your offer is superior to your competitors in your customers' eyes.
It is true that customers' requirements may be changing faster than
ever.
Our responsibility as marketing thinkers is to adapt our processes to
meet this pace of change.
It is no longer sufficient to undertake a major attitude and usage
market research study every second year.
The knowledge gained will simply be out of date.
The good news is that changes in technology can provide great
assistance.
For example, many leading edge suppliers and market researchers are
embracing the Internet as a revolutionary means of staying in touch
with, and learning about, customers' requirements.
Globalisation is a fact of life in most industries.
Marketing in this context means embracing the economies of scale and
benefits that globalisation implies, but at the same time understanding
that customers are not identical in any two markets.
The trick is actually to understand the similarities and the
differences, and to ensure that your business strategy is built around
this understanding.
Think about McDonald's, but remember that even McDonald's has to adapt
and, for example, offer goat burgers in some Islamic countries.
The difficulty of achieving true product differentiation is increasingly
apparent.
How often do you hear a consumer say "as far as I'm concerned, they're
all the same".
What this really represents is a failure on the part of marketers to
understand the individual needs of that consumer and how those needs
could best be satisfied.
It also means that the marketer has not sufficiently considered the
intangible needs of that consumer.
For example the emotional benefits that might be expressed through the
brand.
Market segmentation is a tool that is often applied, helping to identify
the special combination of wants and needs that typify a particular
group, or segment.
However, nothing stops us defining a segment of one, creating an offer
that is absolutely unique to the individual needs of that particular
customer.
Hardly a radical idea when one considers the age-old concept of
tailoring or building to order.
Many of those at the leading edge of applying the Internet to their
business, and taking advantage of the rapid changes in technology, would
have to agree that the fundamental marketing philosophy is still very
much in evidence.
Take the mobile phone as an example. We have on the one hand the
incredible rate of uptake of the base (voice) services.
On the other hand, most of the reports that I read lately suggest that
WAP is not meeting expectations in terms of customer uptake.
Could it be that WAP does not adequately satisfy real needs of mobile
phone users?
Compare the functionality of WAP with that of the phenomenally
successful i-Mode technology in Japan.
The final business challenge, and perhaps the most important, relates to
the idea of aligning employees.
Here the marketing concept is also alive and well.
If we don't understand and take account of the wants and needs of our
employees, how can we expect them to behave in a way that benefits the
business?
Research via climate surveys only scratches the surface in terms of
helping us understand how to deploy our business strategies through
employees.
The growing specialty area of employee communications suggests there is
a lot of learning and experience to gain in this arena.
We can return to Theodore Levitt, who also said back in 1960: "Building
an effective customer-oriented company involves far more than good
intentions or promotional tricks; it involves profound matters of human
organisation and leadership".
Thinking more to the future, what does the concept of marketing have to
offer us and how might we apply the principles to win competitively in
the 21st century?
The key marketing-related success factors for the future have been well
captured by Professor Derek Abells (IMD Business School, Lausanne).
Future business success will require us to:
- Be proactive and revolutionary in our thinking, dissatisfied with the
status quo;
(not either/or);
be responsive to this;
more emphasis on non-product attributes, such as distribution and
service.
So the fundamental value of marketing has not been diminished.
In fact, one can say it is more relevant than ever as we move into the
21st century.
As business people, we need to understand that the concept of marketing
is increasingly our "window on the world".
Success comes from the ability of the business and its leaders to read
the signals from the marketplace, to self-regenerate, to ensure that the
marketing attitude permeates all functions, units and geographies of our
business.
This requires the education of managers in the fundamentals of the
marketing concept.
It also requires the placement of people who "get it" in positions
within the company where they can lead, coach, train and persuade others
to embrace the attitude called "marketing".
