Managing marketing activity
Though the reasons why a company should be marketing orientated may be easy to understand, achieving this in practice is often much more difficult. A combination of factors are required to successfully drive a customer focus, as shown in Fig.1.7. First, shared values and beliefs are a necessary prerequisite for successful marketing implementation; achieving this can be a problem for long-established companies that hitherto did not put the customer first. In general, success in changing attitudes is a hard-won battle.
T
he
second dimension concerns the skills in understanding and responding
to customers, or what Peters and Waterman call 'getting and keeping
close to the customer'. A study by Kohli and Jaworski found that the
starting-point of market orientation was intelligence gathering,
which included not only customers' needs and preferences, but also an
analysis and interpretation of the factors that influence those needs
and preferences. Furthermore, they found that information gathering
was not the exclusive responsibility of the marketing department and
that individuals, such as engineers at conferences, and departments,
such as R&D, often gathered information informally. Next,
information needs to be disseminated throughout the company by formal
and informal means. Kohli and Jaworski tell how marketing managers in
two consumer products companies developed and circulated periodic
newsletters to facilitate the spread of information, while in another
manufacturing company a manager encouraged the process of
dissemination by 'storytelling'. She told stories about customers,
their needs, personalities and even their families. The idea was to
have secretaries, engineers and production personnel get to know
customers. Finally, responsiveness highlighted the need to select
target markets, and design and offer products and services that cater
to current and anticipated needs, and to produce, price, distribute
and promote these products and services in a way that customers
value.
Third, a customer focus implies market-led strategies and the desire to meet needs better than the competition. However, as Davidson points out, the reality of the marketplace should be aligned with the assets (distinctive competences) of the company. When looking to enter new markets, companies should be aware of their inherent corporate strengths and weaknesses. Fourth, organizational structure must reflect marketing strategy. As markets change, marketing strategy changes, and the structure and systems may require modification to implement new strategies. This may involve, for example, using new distribution systems, the breaking down of barriers between departments to foster innovation, or the formation of new alliances.
The last dimension of market-driven management is implementation, which requires clear communication of strategy so that it is not undermined by those who deal with the customer at first hand. One of the most high-profile failures in the drinks industry was that of Guinness Light. Launched as an extension of the well-known Guinness brand, the new product never reached its sales targets and was promptly withdrawn. One of the reasons for its failure was that the margins offered to the distributors (public houses) were less than those available on existing products. Consequently, the distributors had no incentive to push the product and it failed to gain acceptance in the marketplace.