Ic3 Letter-2 Marketing Changes

Marketing Technology Letter

March 2002 – NO.2

Marketing Changes When companies really focus on customers they have to change the way they organise marketing. Old-style marketing is disappearing to leave room to multidisciplinary teams integrating multiple functions and the MD or CEO becomes the marketing VP.

Marketing is quite difficult to define. So, few people understand what it is. Ask ten people what marketing means and you’ll get ten different answers with a bias towards the highly visible aspects of consumer marketing. Their answer depends on their point of view on a very vast domain spanning from high-level objectives in a corporate strategy to minute details of implementation tactics. Introducing new breeds of high-technology products in an embryonic market is quite different from promoting consumer commodities in a mature category. Explaining the benefits of a revolutionary technology has little to do with designing a new package for grocery items. Determining the right price for a service is far away from organising a hot line for customer service.

Change is inevitable, except from a vending machine

Many companies also have problems understanding and organising marketing. We all know by now that change is a ‘constant thing’ in business. Yet, in the last thirty years, the organisation of the marketing function hasn’t changed very much in many corporations. This is quite paradoxical given that a key change is the U-turn from product focus to customer focus.

Go to www.cluetrain.com for a provocative look at the corporate world.

It is surprising to see how few marketers really understand that marketing is, above all, about communicating with people. In the past it was mainly communicating to people. Now, through the Internet, it is increasingly interacting with people. This is perfectly expressed by the first two theses of The Cluetrain Manifesto : 1. Markets are conversations. 2. Markets consists of human beings, not demographic sectors. Ask ten marketers how they feel about their job and they’ll describe: − Frustrations resulting from the persisting ‘silo’ effect. Marketing functions are still confined to one or two departments (e.g. product marketing and ’marcom’) parallel to sales, distribution, customer service and so on. − Problems to overcome their colleagues’ resistance to change and internal politics when trying to implement new marketing technologies and programmes. − Difficulties to combine mastering information technology with creative talent. − Stress from requests to deliver sales leads, generate ROI, increase customer lifetime value and reach other corporate metrics. − Tensions caused by a mix of objective goals and subjective factors.

Like the Cheshire cat, marketing will disappear with a smile

The quest for customer attention and loyalty, the pursuit of quality in products and services, and the need to use information technology with proper judgement all require marketing to change. If a company is really serious about customer ’centricity’ it has to raze the silos, integrate marketing with other functions when appropriate and make it pervasive. Old-style marketing has to disappear to leave room for teams of professionals mastering multiple disciplines and turning their mindset away from corporate politics towards the customer. At strategic level, the customer orientation imposes upon top management the integration of marketing as a central part of the corporate strategy. Marketing has to come out of its ‘ghetto’ and become an enterprise-wide responsibility. The MD or the CEO becomes the marketing VP. Several studies show that companies focusing on quality of service to customers are more profitable than others. In many domains, quality can be objectively measured through multiple parameters. In marketing, subjectivity is as important if not more so. Many aspects of human communication cannot be precisely measured. Emotions cannot be put into equations. So, the leap into pervasive marketing is an act of faith for companies that swear only by hard numbers. However, statistics will continue to prove it is the right bet. Marketing can’t stay the same in a world that keeps changing, can it?

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