Successful marketing requires companies to have capabilities such as understanding customer value, creating customer value, delivering customer value, capturing customer value, and sustaining customer value. “Marketing Insight: Views on Marketing from Chief Executive Officers�? addresses some important senior management priorities in improving marketing. Only a handful of companies stand out as master marketers: Procter & Gamble, Southwest Airlines, Nike, Disney, Nordstrom, Wal-Mart, McDonald’s, Marriott Hotels, and several Japanese (Sony, Toyota, Canon) and European (IKEA, Club Med, Bang & Olufsen, Electrolux, Nokia, Lego, Tesco companies. Many Indian companies are also on the list.
These companies focus on the customer and are organized to respond effectively to changing customer needs. They all have well-staffed marketing departments, and all their other departments—manufacturing, finance, research and development, personnel, purchasing—also accept the concept that the customer is king.
Creating, providing, and communicating value requires many different marketing activities. To ensure that the proper activities are selected and executed, strategic planning is paramount. Strategic planning calls for action in three key areas. The first is managing a company’s businesses as an investment portfolio. The second involves assessing each business’s strength by considering the market’s growth rate and the company’s position and fit in that market. The third is establishing a strategy. For each business, the company must develop a game plan for achieving its long-run objectives.
Marketing plays a critical role in this process. At Samsung Electronics America, Strategic Marketing could be considered a religion. When Samsung executives, engineers, marketers and designers consider new products, they must answer one central question: “Is it wow?�? If “wow�? is the company mantra, then the high priest of “wow�? is the company’s vice president of strategic marketing. His realm includes marketing, advertising customer and partner relations, research, the consumer information center, and B2B and B2C commerce. He is responsible for crafting marketing strategies that reach across five different divisions: consumer electronics, information technology, telecom, semiconductors, and home appliances. Unlike many other companies, such as Sony, in which each division has its own marketing strategy, Samsung unifies strategy for all five divisions. In most companies there is a vice president of CRM [customer relationship management] that doesn’t even talk to the person in charge of TV advertising. We’re threaded holistically from global marketing in Korea to the last three feet of the sale. That last three feet is where the “wow�? needs to kick in—when the consumer is still an arm’s length away from the product, either literally, in the store, or online.
To understand marketing management, we must understand strategic planning. Most large companies consist of four organizational levels: the corporate level, the division level, the business unit level, and the product level. Corporate headquarters is responsible for designing a corporate strategic plan to guide the whole enterprise; it makes decisions on the amount of resources to allocate to each division, as well as on which businesses to start or eliminate. Each business unit develops a strategic plan to carry that business unit into a profitable future. Finally, each product level (product line, brand) within a business unit develops a marketing plan for achieving its objectives in its product market.
The Marketing Plan is the central instrument for directing and coordinating the marketing effort. The marketing plan operates at two levels: strategic and tactical. The strategic marketing plan lays out the target markets and the value proposition that will be offered, based on an analysis of the best market opportunities. The tactical marketing plan specifies the marketing tactics, including product features, promotion, merchandising, pricing, sales channels, and service.
Today, teams develop the marketing plan with inputs and sign-offs from every important function. These plans are then implemented at the appropriate levels of the organization. Results are monitored and necessary corrective action taken. The complete planning, implementation, and control is shown.