Drucker claims a business can function effectively with everything outsourced – except Innovation and Marketing.
Since I am a marketer with experience of, and a strong interest in, Innovation, who am I to disagree?
But what is Marketing? Thirty years ago, at the start of my career, it was a question I had to answer a lot in both my personal and business lives. I found the Chartered Institute of Marketing’s definition very useful in both contexts.
The current version reads: “Marketing is the management process responsible for identifying, anticipating and satisfying customer requirements profitably.” It has not changed in 30 years, and nor has marketing as a concept. What has changed dramatically, and will continue to change at a significant pace, is the specific execution of that concept.
Helpfully, the CIM includes brand, design, consumer behaviour, market research and communication as elements of marketing. In other words, within marketing there are specialists, just as there are in any area of business (e.g.: payroll, recruitment in HR).
This seems very clear and logical, so why am I writing this article? Well, there are many advantages to this approach – for example, the promotion of coherence, co-ordination and commonality of purpose, and yet…
And yet, many people would have you believe that their specialism is not actually part of marketing, but separate and independent. So, over the years many marketers have lost product development, design, PR, brand advertising, trade marketing, and many other areas to specialists. What is left is often a narrow version of marcoms. Sometimes just lead generation.
Why does this matter? It matters because, if the term ‘marketing’ means little more than online lead generation, who has the overview, who sets marketing strategy? Odds are, it will not be someone with a profound understanding of the consumer. As a consequence, the specialists end up fighting for budget and influence, with allocations made by purchasing or finance (at best). Of course, sometimes decisions will be made by an inspired leader who gets it spectacularly right, but much more often this fragmentation will lead to infighting, stagnation and consumer alienation.
The increasing emphasis on digital is not surprising (nor is it wrong in principle), but to characterise anything outside the digital domain as obsolete and a waste of resources is to fundamentally misunderstand both people (not just consumers) and marketing.
Let’s look at just one example. Newly-arrived at VISA AP as the regional market research head (OK, I was the only member of the ‘team’), one of my first tasks was to interpret and share the results of a massive global study into VISA’s brand equity, and how it had been built. Using what would now be called a ‘Big Data’ approach, it was established that the largest single contributor to brand equity was historical brand advertising. It turned out that the effect decayed much more slowly than anyone had thought – as long as there were no significant gaps. You only have to look at Kellogg’s vs. Post for a clear demonstration of this. Note that I refer to ‘brand advertising’ – not ‘TV’ or ‘content’.
So, many major brands, even today, are anchored by historical spending behind brand rather than promotional communication. Whilst never underestimating the power of point of sale communication (another principle drilled into me by my first manager), the brand is built by brand communication.
That brand communication need not be advertising. My second marketing role was new product development on a multi-million pound brand that had spent not one penny on consumer advertising. Think about that for a moment…
We humorously called it ‘the unbrand’, anticipating Muji by a couple of decades, because that was its brand positioning: no branding – just great product. Of course, we all saw the irony in carefully nurturing this brand positioning. A lot of thought, work and, yes, marketing spend, went into creating and maintaining it.
How do you build a brand with no consumer brand advertising? With lots of brand communication. Trade activity, roadshows, education, event sponsorship and PR…all with a consistent and credible positioning. So, turning all marketing activity, into brand communication was the key here – as it is for the vast majority of brands who cannot outspend their competitors.
What digital has done is to create the possibility for challenger brands to leverage their strengths – including being quicker and cheekier – much more strongly. It has always been possible to create newsworthy events to generate ‘free’ publicity (look no further than The Virgin Group / Richard Branson). Now it is easier, quicker and potentially even more viral.
It is tempting to think of the digital domain as so fundamentally different that ‘the rules do not apply’. However, as media and individual reactions to Richard Branson’s stunts show, there really is nothing new under the sun…and he started by following Freddy Laker’s advice (yes, I know that’s before your time).
Techniques may change, and speed and scale may increase, but fundamentally people are much the same. We like human contact, to be entertained, to learn (but not be told), to find (but not be directed) and to hunt out a bargain or ‘discovery’. Much of this does not happen online…there is still such a thing as ‘The Real World’. So remember, Digital is not the only Marketing.