"Good companies will meet needs; great companies will create markets" says Philip Kotler, the worlds pre-eminent marketing thinker.
Stuart Crainer talks to Philip Kotler.
Should marketing move up higher on the board room agenda? Marketing is poorly understood by business and the public. Business leaders largely view marketing as a promotional function. In too many companies marketers have become "1P marketers, the P being promotion. Their responsibility and control and other IP's - product, price and place (distribution) - has weekend and is handled more actively by others. One factor is that many CEOs view marketing as the marketing budget, which is largely spent on promotion. Persons in other departments work actively on the other Ps: product (R&D), price (finance) and distribution (the sales force).
Where is the unified vision that starts with defining target markets and their needs and carries this all the way to preparing integrated solutions? Businesses that grasp the true role and potential of marketing will use it as the driver of their business strategy, and not simply as a tactical compliment. Marketing must also gain a seat on the board which is too rarely found.
Is CRM living up to its promise? Customer relationship management (CRM) remains one of the most promising new marketing developments in recent years. CRM can be tremendously effective when it is used properly. The more a company knows about its customers and prospects the more effectively it can compete. Too often, CRM is imported as a technology before the company has adopted a genuine customer culture. Adding technology to a old organization only makes it a more expensive organisation. So the challenge is to know when CRM is appropriate and how to implement it successfully. It makes the most sense in data rich companies such as banking, credit cards, insurance and telecoms. It makes the least sense in mass consumer markets selling low-price goods. Coca-Cola is not going to benefit by accumulating the names of 2 billion consumers of Coke.
What are the biggest challenges facing marketers now? 1. Getting better financial measures of the effects of marketing programmes. Coca-Cola has made a step in the right direction. Its marketers must estimate - before and after a campaign- the financial impacts of their programmes, even if it is guesswork. 2. Developing more integrated information about important customers. Customers come into contact with a company at various "touchpoints" - by email, snail mail, phone, in person and so on. If these points are not recorded, the company won't have a 360 degrees view of a prospect or customer and , therefore, is handicapped in developing sound offers or communications with the customer. 3. Getting marketing to be the designer and driver of the market strategy. Too much marketing today is 1P, promotion, where as other departments determine product, price and the place. How can marketing be effective if the 4P's are not unified? 4. Facing lower cost/higher quality competitors. As China develops economically, firms will face a repeat of the Japanese threat, which consisted of competing with companies able to offer better products at lower costs. This will force more companies to shift production to China and change the face of global industry and employment patterns. 5. Coping with the increasing power and demands of mega-distributors. Mega-retailers are commanding a larger share of the retail market. Many supermarkets chains are creating store brands that are equal in quality to national brands and lower in price, thus forcing down manufactures margins. Independent brands feel more than ever at the mercy of mega-retailers and are desperately searching for defense and offence strategies.
Who would you say have been the greatest marketing thinkers and business practitioners in business? My nominations would include Walt Disney of Disney Enterprises, Ray Kroc of McDonald's, Roberto Goizueta of Coca-Cola and Richard Branson of Virgin.
copyright Knowledge Center an extract form The Sunday Times 25 January 2004