Greg Foran (President and CEO of Walmart USA, and ex-Woolworths employee) said Woolworths’ biggest weakness was the inability to change. This remains true.

Only with clarity of vision can Woolworths avert a future where Coles and Aldi become the duopoly, and Woolworths is remembered with the same nostalgia that baby-boomers remember Flemings.

The concept is best explained in my book, “The Four Faces of Marketing”, which has been endorsed by many within the strategic marketing community around the world: More simply explained in a picture, headed “The Hierarchies of Marketing”, on the web page…

http://www.launchengineering.com/marketing.htm

I believe the ONLY way Woolworths can be saved is from leadership at Board level… from a Board that can grasp and endorse strong strategic disciplines that will cascade down from very top to the very bottom of the organisational chart.

It’s no mistake that GE became the worlds largest company under the leadership of Jack Welch, with his insights into the 8P’s of Marketing… and the “scuttlebutt” is that WW is losing key executives daily!!! Given THESE EXECUTIVES, many of them toothless strategic ones, can see disaster coming; the Board needs to, too!

AS an ex-employee myself, I hold Woolworths in great esteem, and would hate to see that future rollout; but rollout it will without strategic direction NOW!

Those of us, formally trained in Strategic Planning, can distinguish between ‘strategy’ and ‘tactics’. We also know how and when to alter strategy, the importance of monitoring the market, watching trends and being deeply aware of life cycle, segmentation, product categorization and other strategic marketing models that many business executives simply ‘glaze over’ to, whenever these topics are discussed.

It is clear that Apple has the best of the best operational folk money can buy, and an appalling lack of strategic nous.

This is demonstrated by two glaringly weak strategic activities:

  1. the regression to Type I (continuous) innovation in its new product development (phones & macs), and the debatable wisdom of its only recent Type II (dynamically continuous) innovation. (iWatch)
  2. Pricing Strategy that is devoid of strategy, ignorant of segmentation shifts, that clearly undermines Apple’s future and growth.

I’ll leave the nature of innovation to another day… but Apple’s PRICING STRATEGY is in dire straights!

Yes, price skimming and profit gouging works in certain circumstances, but even naive marketing graduates understand cascade down pricing strategy.

Apple MUST be shouting down commentary from within about ‘value-based’ pricing, about elasticity of demand, about market development theory, or even when confronted by competition analysis.

Some VERY WEAK senior management must be at the helm to maintain the strategies of last year, when it is in fact THIS year!

When you observe, “it has always worked this way, way change it”, or “If its not broken, don’t fix it” in the halls of power… you know the empire is crumbling.

But Apple’s Pricing Strategy right now is building a road for Apple to end up where it was in the mid 90’s…

Apple needs HUGE strategy, NOW!

SOMEONE, needs to go in and identify their true PRESENT capabilities, not past ones.

SOMEONE needs to REALLY grasp the needs and wants of TODAY’S market, and tomorrow’s market, not yesterday’s.

SOMEONE needs to align and engage the whole corporation with love and passion for NOW, not yesterday’s.

SOMEONE needs to bake some humility into the APPLE pie!

Think about this…

Apple has cost leadership strengths, economies of scale, and brand preference (marketing advantage) … Why the f^&* are they still price skimming when they could own the market by by pursuing price advantage?

Their insistence on maintaining their 20th century pricing policies, have created massive competition, made the industry easy for nee entrants, built sufficient margin for others to establish brand equity, and (effectively) brought on high competitive rivalry that didn’t need to be there!

I defy ANY APPLE EXECUTIVE to show me complete and hard evidence that their pricing strategy is nothing short of ludicrous in today’s market… and even if they COULD present a case, I’d probably challenge the validity of the research.

But, mark my words, if Apple maintains premium pricing you will see decay of market share, better and more potent competition, and Apple’s slow fading into insignificance and decline.

Not only is this workshop is packed full of tools and knowledge for any executives who could use a brush up, training, or review of their Marketing Planning skills … Reviewing existing state-of-the-art Marketing Planning, but it ALSO also introduces new, evolving and breakthrough approaches to Marketing Planning that represent cutting-edge in Marketing science.

The course goes far beyond a revisit to a marketing planning template… embracing the issues around development and implementation ‘hurdles’ that all organisations face.

A leading FMCG executive described the my last workshop as, “One of the most insightful conference/trainings that I have attended for long time” and I’m hoping savvy executives will be equally as happy in the aftermath of attending “CREATING BREAKTHROUGH MARKETING PLANS THAT WORK!”.

If you are not at liberty to attend, why not tip-off anyone else who might be keen to do so? Click here for the PDF with more info http://j.mp/MkgPlnWS

An ‘early-bird’ discount expires at Xmas, so it might be best if you act right away…

Too many marketing strategists believe their own BS! Pricing Strategy, Communications strategy, Online Strategy, branding strategy etc. isn’t genius… it is obvious, common sense that evolves out of the fact that perfect knowledge leads to perfect decisions.

I’ve had an extraordinary number of commercial successes in my career, record-breaking ones… NOT because I am one bit smarter, more intuitive, have more street cunning or am unusually lucky, but because I persevered long enough in learning my trade to be able to recognise the one, inalienable truth of business: If you genuinely know what the customer wants and can give it to them, they WILL buy!

The absolute secret, of all extraordinary business success, is knowing the customer.

Is it REALLY that simple?

Whether it is the individual or the segment – yes!

There are so many examples of this across the internet, in each of our careers, recorded, diagnosed, studied and reported by academics around the world, and demonstrable in every case study and high return annual report… so why do we complicate and confuse, cloud and cover this fact?

Think about it…

Pricing Strategy: In particular Value-Based pricing? Know the customer!

Communications strategy: In particular advertising & positioning? Know the customer!

Retailing: In particular store layout, ranging, staffing, location? Know the customer!

Manufacturing: Everything from branding, sizing, packaging, new product development, distribution strategy? Know the customer!

Why is the business community in denial?

When FMCG hummed a merry tune, the industry habitually committed to segmentation studies annually… but as operational executives with corporate political skills rose in a culture of corporate arrogance, costs were cut to carve out larger profits, ignorant to the fact they were really blunting competitive advantage and digesting brand equity.

In adequately training marketing personnel, briefing and sustaining market research of questionable quality, undermined the payback from segmentation studies and other market research.

Over the years, the team at my firm has written strategy for transport, banks, FMCG, commodities, utilities, government that has generated record-breaking results, unimagined sales growth, and extraordinary profits… why? Simply better understanding of the customer – EVERY time!

An example of how ignorance of the Hierarchies of Marketing can corrode success.

There is a large company – one of the world’s top 500 companies – headed for hard times due to an absence of strategic acumen.

It is a business that owns, operates or manages thousands of holiday resorts across the world.

One of its divisions is an arm that distributes a derivative of of the timeshare concept. Instead of selling the same venue, at the same time, to a consumer, they offer “Vacation Credits”… effectively pooling timeshare ownership across a network of venues that accept a homogenised booking system trading in ownership leverage measured by “credits or points” that a “member or owner” possess.

A great deal, poorly marketed.

Lack of strategic marketing acumen

Management have high operational expertise: They seek out and pursue operationally driven means to squeeze productivity and sales performance. Its killing their business! Operational compliance. Professional conduct. Processes and procedures are impeccable. While overtly obedient to compliance, behind the scenes Sales Management push the envelope:  Personnel are at the forefront of covert ethics… carnal. mercenary, desperate, stressed.

“Don’t talk to me about ‘marketing’… Just get out there and sell!” is the middle management response to those that dare voice their intuitive frustration at an approach that screams out inefficiency.

This company doesn’t invest in adequate market research. It doesn’t understand its prime target audience. It doesn’t understand market segmentation. It doesn’t monitor changes in the market place. It doesn’t respond to new, evolving segments.

“Marketing”, to them, is promotions: They even call their lead generating hawkers, “The Marketing Team”.

This company still uses methods developed in the 1970’s. They run a shotgun appeal sweepstake for lead generation, supported by gifts offered to prospects to attend a sales presentation. Imagine using the same (often weaker) marketing communications strategy for over 30 years!!!!

Their sales teams end up with very low conversion rates, are frustrated and suffer high turnover.

Their operational promotional team produce week, ineffective sales promotions collateral.

They spend huge amounts in HR training, but waste it paying immigrant labour minimal wages at the coalface.

They still grow – at 1,000 ‘members’ a year. If they were empowered with strategic marketing leadership, they’d grow at no less than 25,000 members a year.

Like so many companies, the bigger they are, the harder they fall….

“We’ve been doing this for 40 years… what do you know!”

“We’re a top 500 global company, how dare you suggest you know how to run our business better than we do!”

“Even if you were right, we couldn’t service growth of 25,000 members per year.”

I am reminded of the quote, “There is no reason anyone would want a computer in their home” by Ken Olson, president, chairman & founder-Digital Equipment Corp. in 1977. The point being that larger corporations suffer resistance to change with greater inertia than smaller ones. Part of this comes from what is cynically described as “Corporate Arrogance” but often simply a factor that results is Operationally-extraordinary executives being promoted into roles that need Strategically educated and oriented approaches to strategic decision making.

I’d be interested in response from any company that sees itself in a similar situation, and from executives who have experienced and overcome the transition from operational focus to strategic focus… and their results.

 

People wanting clarity on the Hierarchies of Marketing can go to…

http://www.launchengineering.com/marketing.htm

… or pre-order my upcoming book on the Hierarchies of Marketing from BookBoon.com.

The academic study of Marketing was initially undertaken to make business decision-making easy… and it worked! Marketing decisions that religiously, if not fanatically, followed the technical revelations of academic marketing teachings, have worked, and worked, and worked.
In my career, every single marketing plan based upon the teachings of my studies, and implemented accordingly, has “hit-the-ball-out-of-the-park”, so to speak.
In my 3rd year at Uni, a recent graduate guest lectured on the launch of Moove & & Good One in the 70’s, explaining how they simply applied text-book marketing theory and would up with the most successful marketing outcome in the history of milk marketing. It was text-book theory that was used to save and re-launch My Dog & in the 80’s.
With reverence to the KISS principle, after 13 years of studying marketing, 38 years of applying it, 7 years of teaching marketing at University, I can confidently suggest that the core to successful marketing comes from knowing the segments in the market place and targeting and positioning to attract preferred segments.
So, with segmentation being the virtual “road to riches”, you would think all marketing executives would scramble for any segmentation market research above all else, and covert the opportunity to get as much as possible to empower them and simplify their whole function.
Alas, few good marketers stand in the ranks of business, and many of these are constrained by superiors whose limitations create the black holes into which fall opportunity and money.
Reality slapped me in teh face recently, when my firm decided to systemise a method of empowering clients with segmenatation knwoledge, and offfered a promotion… 2 (ideally sequential, not mandatory) segmentation studies, worth around $160,000 for just $60,000 – with an $11,000 social media marketing promotion thrown in. This offer was sent to a select 60 key individuals I know needed a market segmentation study.
Can you guess the response?
Now these guys KNOW that “the segmentation studies they get now” – are likely (at best) to be performed by the guys that taught market research to their current suppliers of market research, so its not a matter of quality.
Loyalty? OK… is that loyalty well advise in the light of the best interests of shareholders? Is it in their own best interests to miss out on more frequent, timely and recent information? Given that fresh segmentation information could make the difference between growth or deletion, between profit and loss, between market dominance and market share erosion, wouldn’t it be worth the effort?
To a great marketer – this would be a great opportunity… there are just too few of them about.

What is the Marketing Concept? What is the basis of all marketing management?

Is it not meet the customers’ needs with available resources?

Is pushing an imperfect satisfaction of needs, via advertising, personal selling, tricky copy and negative options, give-aways and incentives, going to imbed success in a brand?

Is a badly thought-out product or brand extension, timed well or not, a failure because of insufficient advertising?

Not necessarily.

Looking at the purpose of a marketing expert’s being: For all exponents of the marketing profession, there is one focus… The needs and wants of the markets (or the targeted segments in which you are interested).

IF the market NEEDS advertising, if the ACTUAL product (as opposed to CORE product) includes imagery and positioning, then the marketer’s responsibility is to deliver those needs. In delivering the needs of the target audience, a marketer maintains brand equity, and thus, the life of the brand/product.

If the marketer just invests in advertising without understanding the customer, life cycle is bound to prematurely terminate, brand decay will set in, and brands will die…. in response, of course to substitutability, imitability, comparative value and rarity.

This turns focus not to the science of marketing but the skills abilities and talent of marketing management personnel.

Does management “get it”? Do they really UNDERSTAND ‘marketing’ or do they perceive it hype, advertising, or selling? Are they CAPABLE of embracing and applying marketing science, or simply charismatic diplomats, climbing the corporate ladder? Are they EMPOWERED with funds, autonomy, flexibility and leadership support to implement? Do they have the ACUMEN to pull it all together and planning skills to imbed the direction for years to come?

[The answer, by the way, is that ego and corporate arrogance, stop people like us helping people like them 😦 ]