The Marketing Mystique (by Edward McKay)

The Marketing Mystique (by Edward McKay)

Marketing orientation means…
Knowing
what customers want,
what they consider value, and
what they will pay for

Managing the whole business to fulfill these expectations
so the consumer
is satisfied,
tells others, and
comes back to buy again.
Principal characteristics & features of the marketing orientation
• The focus is on the marketplace—customers, competitors, and distribution.
• A commercial intelligence system monitors the market.
• It requires recognition that change is inevitable, but manageable, in the business arena.
• The business is committed to strategic planning and marketing planning and to creative product planning.
• The emphasis is on profit—not just volume—with growth and profit kept in balance.
Establishing a Market-oriented Philosophy
- Resolving the Marketing Paradox
  - Philosophy and performance
    A Major gap exists between business philosophy statements and marketing performance as judged by customers in the marketplace.
  - What is the marketing concept?
    • a business philosophy,
    • a modern form of organization,
    • an approach to strategic planning,
    • a dynamic operating system, and
    • a performance appraisal.
  - Who is the professional marketing manager?
    - The purpose of marketing
      is to direct all vision and effort
      of the business toward marketing objectives,
      and to direct all vision and effort
      of marketing toward the objectives of the business.
  - What is a business?
    - basic and continuing characteristics
    - Changing
      - Markets
      - Customers
      - Distribution patterns
      - Competition
      - Constantly changing strategies of business
- Determining the Nature of Your Business
  - The steps to understanding: What is my business?
    - A business inventory
      - Market segments served
      - Products and salable services offered
      - Strengths and weaknesses in each business area, both present and anticipated
      - X-ref Part 3 & Part 5
    - The business arena(s)
      The business arena is where the action is.
      It is the marketplace.
      It is where …
      customers
      your company
      distribution
      competitors
      the environment
      interact to determine
      who buys, who sells, & what the payoff is.
      
      These arenas are constantly changing.
      - x-ref chapter 10 — Commercial Intelligence system and process
      - x-ref chapter 11—Business arena analysis
    - A vision for the business
      - The questions that lead to a choice of vision
        
        What business are we really in? Not in hardware terms, but in terms of customer needs?
        What is the future visualized for each business segment?
        What could each segment become, and the whole?
        Where do we want to take each segment, and when?
        What are the scale, direction, pace, goals, and strategy required to get us there?
      - Evaluation questions
        
        Is this vision clear?
        Is your style of management in character with it?
        Is the vision understood and supported by all employees?
        Are your … designed to enhance and implement this vision?
        
        products and pricing policies
        strategies
        supporting activities
        
        Is the vision reflected in the character of your sales and advertising representation
        
        Appropriately
        Consistently
        Effectively
        
        Do you say your business is customer-oriented while your actions show that it is really supplier-oriented?
        Does the vision look to the future?
        
        Does it anticipate and predict what is desirable and then seek means for achieving the new goals
      - x-ref methods and tools presented in part 3 and of the marketing appraisal presented in part 5
    - An image of the business
      - The term "image" has been almost destroyed by overuse and abuse
      - Conceive, develop, maintain
        
        An integrated, consistent, and publicly accepted character and personality.
        which fit the vision for his business and the markets he chooses to serve
      - Must be communicated
        
        Within the business
        To customers & prospects
        To the public
    - The business charter
      - If this is a business
        
        substantial complexity in
        
        Product lines
        Markets served
        Sales and distribution channels employed
        
        decentralized with several interrelated or interdependent businesses
      - The charter
        
        The nature, intent, and vision proposed
        Outline of broad and continuing objectives and long-term strategies
        
        For the business unit as a whole
        For each major segment
        
        A definition of important continuing relationships
        
        Internal
        External
        
        Delineation of the scope of the business
        
        Each segment defined in terms of activities, products, markets
        
        A commitment to development and exploratory work
        
        in areas of products, services, and distribution
        beyond the present business scope
  - This our business
    - Increasingly difficult to answer "What is our business"
    - Increasingly imperative to provide a suitable answer/decision
    - Positively and clearly
- Selecting the Orientation of Your Business
  - Alternative orientations
    - Production
      - Principal characteristics & features
    - Sales
      - Principal characteristics & features
    - Technology
      - Principal characteristics & features
    - Finance
      - Principal characteristics & features
    - Marketing
      - Principal characteristics & features of the marketing orientation
        • The focus is on the marketplace—customers, competitors, and distribution.
        • A commercial intelligence system monitors the market.
        • It requires recognition that change is inevitable, but manageable, in the business arena.
        • The business is committed to strategic planning and marketing planning and to creative product planning.
        • The emphasis is on profit—not just volume—with growth and profit kept in balance.
      - Should not be confused with customer orientation
        which connotes a complete focus on the customer. The latter suggests a broader view, which considers also competitive and distribution influences and proper balance between the external market considerations and the internal requirements of the business.
  - A balanced view of the business
    - Understanding the traditional and present orientation
    - A balanced view of the business
      - A balance between the needs of customers and the ability to serve
        It often possible to create or develop customer wants and needs. It also recognizes that company resources and the ability to serve, which they represent, can be modified, supplemented, or superseded as the enterprise seeks to adjust to market opportunities.
      - Competitive considerations
        This balancing of needs against resources must be done in light of the competitive considerations prevailing in the business arena involved.
        In other words, reactions and responses of competitors to the moves you make and your reactions and responses to the moves they are most likely to make are vital to your choice of opportunities, your policies, and your strategies.
      - Environment
        Similarly change in the environmental situation under which your business operates have vital bearing on your decisions. More and more, social, economic, political, and even physical factors in the environment must be taken into account.
      - Anticipated operating results
        Also essential to this process is the evaluation of anticipated operating results that will accrue from the alternative courses of action under consideration.
      - Selected business opportunities
        What is required for balance is a careful interrelating of customer needs with your ability to serve, in light of competitive considerations, the environmental situation, and anticipated operating results. Only through this approach is it possible to make an orderly and rational selection of business opportunities.
- Adopting and Implementing the Marketing Concept
  - Introduction
    - Major commitment
    - Heavy impact on every business procedure
    - These changes will not be easy to implement
  - Need for preplanning / The lack of progress in adopting the concept
    - A substantial majority of large and medium-size companies have at least nominally adopted the concept
    - Lack of progress reasons
      - Inadequate understanding of the concept
      - Weak top-level sponsorship and commitment
      - Lack of professional leadership within marketing
      - Failure to do the comprehensive planning essential before adoption and implementation
  - Sponsorship
    - CEO
      - Thoroughly understand the nature of the commitments required
      - Recognize the impact this move will have on his own attitudes and policy decisions
      - Be prepared to deal with resistance
      - Accept leadership responsibility essential to enable and facilitate accept
      - Must set an example in
        
        resource allocation decisions
      - Must have/get in place a marketing head that…p23 & chp 18
        
        Who must have the authority commensurate with his role
        Must be someone the marketing organization respects
      - Functional integration and teamwork compatible with marketing orientation
    - Need a true professional in the marketing organization
    - Need some "Hair shirts" — "true believers" in the marketing organization
  - Relationships with other functions
    - Probably need to build new and different relationships with other functions
    - What the marketing concept means to …
      - General Management
      - Research and engineering
      - Manufacturing and production
      - Finance
      - All aspects of corporate relations
    - Marketing orientation means…
      Knowing
      what customers want,
      what they consider value, and
      what they will pay for
      
      Managing the whole business to fulfill these expectations
      so the consumer
      is satisfied,
      tells others, and
      comes back to buy again.
    - Believe or beware is the appropriate slogan
  - Communication program
    - Tailored to… p26
    - Useful elements… p26
    - Goals of the program
      - Understanding
      - Acceptance
      - Encourage action
  - Education in marketing
    - Part of the implementation
    - Someone in marketing should be given continuing responsibility
    - Suggested activities
      - An indoctrination program
      - Formal courses in marketing management
      - Specialized courses
      - In-company management workshops
      - Rotation within marketing
      - Rotation with other functions
      - Coaching
      - Career counseling
  - Marketing tools, methods, policies (areas of consideration)
    - New forms of research in marketing
    - New systems and uses of commercial intelligence
    - New systems of data processing
    - New communications media and programs
    - Mechanized and automated physical handling of products in the marketing system.
    - Use of a master calendar of marketing events
      - Product introductions and withdrawals
      - Field tests
      - Sales and promotion campaigns
      - Policy changes
      - Training activities
    - Checklist of persuasion instruments suitable to their competitive arena
      - Trade-ins
      - Premiums
      - Demonstrations
      - Trading stamps
      - Contests
      - Fair trade
      - Dating plans
      - Many other sales, promotion, and merchandising aids.
  - Marketing policies
    - Early review of all policies
    - Development of new or modified policies where required
    - Program of periodic monitoring of policy needs
    - Subjects for policy consideration (policy scope)
      - Product lines
      - Pricing
      - Distribution
      - Product services
      - Trademark and branding
    - Principles for consideration in operating a policy system…
    - Should be issued on only a few major subjects
  - Advanced implementation within marketing
    - Periodic meeting to evaluate the progress in implementing the concept
    - Checklist of timely topics (general and partial list)
      - The marketplace
        
        Do we regularly and systematically analyze our markets?
        Do we understand and use market segmentation?
        Do we have the commercial intelligence we need to manage effectively?
        Are we satisfied with our communications from and to customers?
      - Products and services
        
        Do we have a creative approach to product planning?
        Do we have product leadership?
        How do we rate in …?
        
        product quality
        product performance
        overall value of our offering
        
        What services do we sell before, during, and after the sale?
        Are our pricing policies and practices competitive?
        Do we really know if customers would agree with our answers to these question?
      - Advertising and sales
        
        Are our messages addressed to customers, or are we talking to ourselves?
        Is our media selection focused on our important market segments?
        Do our distributor and dealer aids serve the real needs of these allies?
        Is our advertising agency truly market-focused, or merely client-focused?
        Do we evaluate our promotion by its impact on customers?
      - Sales and distribution
        
        Do we know where and how customers want to be served…?
        
        in kind
        number
        location of outlets
        representatives
        
        Does distribution share and help to implement our vision and intended use?
        Are our … market oriented?
        
        agents
        distributors
        dealers
        our own sales & service people
      - Service to customers
        
        Do we know what services customers want?
        Can and will they pay for these services?
        Are we keeping up with or ahead of competitors in providing services?
        Do we know customer expectations … of services?
        
        speed
        quality
        price
        
        Are we satisfying these customer expectations?
    - See the checklist in Part 5
    - Need to develop a teamwork program between marketing and other functions
    - Implementation program for the business as a whole
Building a Market-oriented Organization
- Satisfying Both the Business and the Customer
  - Organization change
  - The purpose of organizing
  - Organizing objectives and principles
  - The organizing process
- Selecting the Style of Organization
  - A baker's dozen of organizational styles
    - Formal vs. informal
    - Centralized vs. decentralized
    - Autocratic vs. democratic
    - Mechanistic vs. organic
    - Vertical vs. horizontal
    - Effective vs. efficient
    - Carrot vs. club
    - Specialist vs. generalist
    - Work vs. people
    - Individual vs. group
    - Integrated vs. coordinated
    - Calm vs. conflict
    - Climate vs. system
  - Some principles of style
  - Contrasts in style
- Clarifying Marketing Functions and Relationships
  - Business functions
  - Scope of marketing
  - Marketing functions
  - Clarifying marketing relationships
  - Teamwork
  - Relationships with external groups
  - Relationships within marketing
  - Product planning teams
- Structuring the Marketing Organization
  - The structuring process
  - Determine work to be done
  - Establish the structural form
  - Design individual positions
  - Wrap up and document proposed organization
  - Communicate and implement the plan
Orienting Strategic Planning to the Marketplace
- Designing the Planning System and Process
  - Marketing's role in planning
  - The planning system
  - Alternative approaches to planning
  - What is a plan?
  - The need for strategic planning
  - The strategic planning process
  - Planning principles
- Establishing a Commercial Intelligence System
  - Intelligence approaches
  - Scope and purpose of commercial intelligence
  - The commercial intelligence process
  - Feedback for refining the process
  - Guidelines for commercial intelligence
  - Intelligence on individual competitors
  - Balancing system requirements
  - Commercial intelligence at work
- Defining Business and Market Segments
  - The need for segmentation
  - Understanding the business arena in depth
  - Selecting and evaluating key arena factors
  - Determining suitable persuasion approaches
  - Business segmentation
  - Market segmentation
- Formulating Objective and Strategies
  - The need for selectivity
  - The formulating process
  - Areas of business objectives and strategies
  - "Strategy radar"
  - Types and areas of business objectives and strategies
  - Types of marketing objectives and strategies
  - Market expansion through product development
  - Guidelines for formulating objectives and strategies
- Documenting and Communicating Strategic Plans
  - Format and content of a business plan
  - Format and content of a marketing plan
  - Criteria for evaluating strategic plans
  - Communicating strategic plans
Operating a Dynamic Marketing System
- Managing the Dynamics of Marketing
  - Selecting business opportunities
  - Managing change
  - Continuous innovation
  - The systems attitude and approach
- Managing the Product System
  - Purpose of the product system
  - Methods and tools
  - Objectives and strategies
  - Choosing and evaluating new products
  - Planning for existing product lines
  - Product elimination
  - Product planning redefined
  - Organizing for product planning
  - The product planning process
  - Interfunctional relationships
  - The professional product planner
  - Pricing policy and practice
  - Avoiding product-system pitfalls.
  - Appraising the product system
  - Product-system ideas in practice
- Managing the Persuasion System
  - Purpose of the persuasion system
  - The persuasion planning process
  - Organizing the persuasion system
  - Selecting persuasion approaches
  - Operating the persuasion system
  - The persuasion system at work
- Managing the Support System
  - Purpose of the support system
  - The support planning process
  - Organizing the support system
  - Operating the support system
  - The support system at work
- Selecting the Marketing Manager
  - What he needs to be
  - What he needs to know
  - What he has to do
Appraising Marketing Performance
- Appraising Overall Business Performance
  - Marketing involvement
  - Elements of purpose
  - Who will appraise?
  - Appraisal methods
  - Evaluation standards
- Designing the Marketing Appraisal System
  - Marketing appraisal methods and categories
  - A self-appraisal approach
  - One company's marketing appraisal approach
- Selecting Market Appraisal Categories
  - Leadership in managing change
  - Marketing orientation, organization, personnel
  - Strategic planning
  - Product system
  - Pricing policy and practice
  - Persuasion system
  - Support system
  - Marketing results
  - Refining the appraisal checklists
- Developing the Marketing Appraisal Action Plan
  - Logging action items
  - Timing and agenda for subsequent appraisals
  - Marketing's role in the money system
  - Ideas that pay off
  - The big idea
  - Benefits of self-appraisal

“The greatest danger in times of turbulence is not turbulence; it is to act with yesterday’s logic”. — Peter Drucker

The shift from manual workers who do as they are being told — either by the task or by the boss — to knowledge workers who have to manage themselves ↓ profoundly challenges social structure …

“Managing Oneself is a REVOLUTION in human affairs.” … “It also requires an almost 180-degree change in the knowledge workers’ thoughts and actions from what most of us—even of the younger generation—still take for granted as the way to think and the way to act.” …

… “Managing Oneself is based on the very opposite realities: Workers are likely to outlive organizations (and therefore, employers can’t be depended on for designing your life), and the knowledge worker has mobility.” ← in a context

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