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Unit 1
Summary of How It’s Done
MARKETINGSimple
tm
“Principle-based Marketing”
Non-narrated, PowerPoint Slide Presentation with Notes
Mike Ahlstrom
33 Slides
April 3, 2012
©2012. Mike Ahlstrom. All rights reserved.
I. Introduction
Requirement
• You agree to hold me, my school and students
harmless. This presentation and my book are
only giving you advice. You should consult with
other professionals.
• You use this material at your own risk.
You
• Are you struggling with marketing?
• If you’re not struggling with it right now, you
will be!
• What will you do when customers don’t show up?
Me
• I know marketing.
• I have taught it fulltime at a state university for
six years, after a 35-year career in business.
• I worked as a marketer in big marketing firms –
P&G, Pillsbury, Land O’ Lakes – for 10 years,
followed by other companies, consulting,
and a successful start-up.
Business Prosperity
• MARKETINGSimpletm is where marketing is made
more successful by basing it on the main
principles of marketing!
• Marketing is the weak link in the chain for many
products. It is the most likely business discipline
to fail.
Fail?
• Consider:
– The American Marketing Association has changed its
definition of marketing 3 times in the last 10 years.
– There is very high chief marketing officer turnover – 24
months, on average. What does that imply?
– CMOs have low credibility – just 3% sit on boards of
directors of public firms, vs. 26% of chief financial officers.
– See http://www.emorymi.com/MarketingisDead.shtml
– See http://www.bizresearchpapers.com/21.%20RogerFINAL.pdf
– See http://news.cnet.com/8301-13641_3-1015904444.html
– Ask new marketing graduates to outline how they would
do a marketing plan. See how fast they mention the 4 Ps,
especially promotion.
• Why the problems in marketing? It has no clearly
identified main principles!
II. Introduction to Principles –
Example Learning Case
Camay – 1973
Camay Soap – What would you do? The brand had
been steadily losing market share for years.
A. Develop entirely new TV advertising? Camay was spending
most of its promotion budget in TV.
B. Or change its marketing strategy?
C. Read more about Camay, next.
1973 – Cincinnati, OH; P&G Headquarters; 10th Floor
Camay was a relatively small brand. However, it was culturally important. Key company executives had managed Camay. They didn’t want it to
die. It was a good place for a new brand manager to show his stuff. Not a new-comer to Camay – I knew the brand intimately – I had been its
assistant brand manager for a year earlier in my career. My hope now was that of all new brand managers: do something impressive. I wanted
to bring Camay back to life.
From a Situation Analysis
Birth: Camay, born in 1926, was a mild, gentle soap for women. Its name came from the French word, “camée” (the jewel), referring to the
soap’s cameo stamp on its top.
Rise to respectability: in the early 1950s Camay had about 20% of the market. It was doing well. Two key competitors were Palmolive and Lux.
Fall from grace: during that time, a new kind of soap, called a detergent which worked better in many situations, became more broadly used.
Detergents, unlike soaps which are quite alkaline, are slightly acidic, and as a result are gentler on skin (which is also mildly acidic).
A new detergent-based bar, Dove® Unilever – “One-quarter cleansing cream” – was launched by Lever Brothers in 1957. By 1973, Camay’s share
of store sales had fallen to 6.0%. Shelf space could be lost next.
Tried: four carefully considered steps were taken to strengthen Camay’s business – one before Dove, three after it launched. None worked:
1. In the early 1950s, foreseeing stronger competition, the brand adopted a “soft skin” positioning – a big issue with women – by adding the
words, “contains cold cream” to Camay’s wrapper, which was interesting because research showed women would not respond to the claim.
To my understanding, while Camay did contain a very small amount of an emollient (cold) cream, it did nothing for skin because the cream
was washed away by the soap action of the bar. The hope apparently was that over time the soft skin positioning would sink in. It didn’t.
2. About 1970, Camay’s tallow formula was modified to contain about half coconut oil soap, which made twice as much lather. It also cleaned
really well, because the coconut oil-based soap went unto solution so well and was very basic.
3. At the same time, the wrapper was changed from paper to a prettier, soft , plastic foam-based material.
4. When assigned to Camay previously as its assistant brand manager, I had been part of the team that adopted the closing line in current TV
ads, “Camay, the Beauty Cleanser” (with questions in their minds about what it meant), spoken by a paid, celebrity presenter, beauty expert,
and author – Princess Luciana Pignatelli from Italy.
A Strategic Fix Needed?
In retrospect, after becoming Camay brand manager in 1973, the initial “picture” I constructed of its marketing mix, of strategies the brand
group controlled, was not very revealing. Solely from what was soon to be called the four Ps by Jerome McCarthy (Product, Place, Price, and
Promotion) – P&G used a rough equivalent back then – there was apparently nothing new to learn or fix. The brand was already spending $5
million per year in promotion, 60% in TV, and Camay was still sinking! Its ad agency periodically suggested totally re-vamping its advertising.
What Would You Do to Fix Camay?
A. Develop entirely new TV advertising?
B. Or change its marketing strategy – Camay’s 4 Ps marketing mix as it then existed?
C. Something else? Case recommences on slide 23.
III. Goal of Marketing:
Prosperity – an Abundant Life!
Abundant Life
• A life full of
–
–
–
–
–
–
–
Prosperity
Usefulness/service
Happiness
Goodness
Blessings
Success
Joy
• Abundance: the American Dream
• What are you willing to do to achieve it? Adopt
three principles?
IV. Main Principles of Marketing
Main Principles of Marketing
1. Purpose. The purpose of marketing is to create
and sustain demand profitably and honorably.
2. Process. Demand is not created magically with
creativity, but rather by using a standard, marketing planning process, with creativity at the
right time, in the right way.
3. Practices. Marketing planning must be fast,
transparent and team-based, because competition and opportunity never end, and because
marketers always need the cooperation of other
disciplines.
Discussion of Principle #1
• Create and sustain demand profitably and
honorably.
• Just 7 words!
• Must be direct; want no confusion.
• Not 27 words like the current AMA definition.
• So, do enough people demand your product?
• If they don’t, use the MARKETINGPipelinetm (MPL),
next, to create demand.
View of the Standard Marketing Planning
Process – the MARKETINGPipelinetm – Principle#2
Process – Principle #2
Purpose – Principle #1
Create and
Sustain
Demand
Profitably and
Honorably
Discussion of Practices – Principle #3
• Marketing planning must be fast. You never
know when an opportunity or crisis will occur.
• Transparent so others can buy-in. You expect
them just to trust you, without understanding?
• Marketers must work as a team with other key
managers. They too have a big stake in how
successful marketing is.
• Memorize the main principle, the process (the
MPL), and the above practices.
• Be able to explain to the management team
how you’re going to plan marketing!
V. How to Use Marketing
Textbook Concepts
Put Key Marketing Text Concepts Around
MPL Segments; Use them as Appropriate
Concepts Related to Analyzing
Concepts Related to
Operationalizing
Concepts Related to
Strategizing
Concepts Related to Functionalizing
Full MPL with Key Text Concepts
Textbook Concepts Related to Analyzing
15 Ways to Analyze: Foundational; Projection, i.e., Pain Point Analysis – “would I buy it?”; Observational; Business Data; Lifecycle;
Category; Internal Situation; External Environmental; Competitive; Strategic Profitability Model (DuPont Model); Blank Strategic
Marketing Plan; Marketing Research (secondary/primary); Porter’s Five Forces; SWOT; Gap (for services); Feelings –
ow you feel – a nagging sense of something is wrong. Add others
Your Objective?
Textbook
Concepts
Related to
Operationalizing
Measures and
Metrics;
Add Others
Create and Sustain
Demand Profitably
and Honorably!
Textbook
Concepts
Related to
Strategizing
4 Ps; 10 – 11 Ps;
Add Others
Research
Pilots, Test Markets
Mgmt. Approval
Data / Observation
Textbook Concepts Related to Functionalizing – IMC; the promotion mix (6 tools – advertising, PR, direct marketing;
sales promotion, interactive/word-of-mouth, personal selling); Add Others
MARKETINGSimpletm Features
• Works for any product; can produce a tailor-made
marketing plan for every product, fast
• Integrates main principles with needed actions
• Simplifies/standardizes planning; is visual/memorable
• Produces 1-page/1-day Strategic Marketing Plan (SMP)
• SMP morphs easily into 4-page Functional MKTG Plan
• MKTG Plan readily expands into 10-page Business Plan
• Integrates 7 “checks” into the planning process
MARKETINGSimpletm Benefits
• MARKETINGSimple (MS) can double, triple,
5 - 10X your odds of success vs. not using a
standard marketing planning process
• MS increases credibility with other disciplines
• MS builds a sustainable competitive advantage.
As you learn it/use it, your marketing can
standout, can lead to prosperity/abundance,
can really help your career!
Example – Camay Revisited
See How Analyzing/Strategizing Works
P&G Brand; Born in 1926; $30 million in sales in 1973; its share of
market had fallen 1957 - 1973 from 20% to 6%.
What Would You Do?
A. Develop entirely new TV advertising? Camay was spending
most of its promotion budget in TV.
B. Or change its marketing strategy – Camay’s 4 Ps marketing
mix as it then existed?
C. Do something else. As Camay brand manager, I used the
MPL!
A Failing Brand – 1973 4 Ps Snapshot
Camay Product
High lathering soap that cleaned really well (“next best thing to paint thinner,” one
company expert had jokingly said)
Place
Supermarkets, drug stores, mass merchandisers
Price for Profitability
$.29 per complexion bar; $.41 per bath bar
Promotion
$5 million in yearly promotion spending, $3 million of which in TV advertising featured
a beauty expert saying, “Camay, the Beauty Cleanser”
Expanded Camay 4 Ps Snapshot to 7 Ps
and Immediately Saw the Disconnects
People
All women, especially women with dry skin
Product
High lathering soap that cleaned really well (“next best thing to paint thinner,” one
company expert had jokingly said). Technical note: strong cleaning aggravates dry skin.
Promise (the Big Benefit)
Soft Skin
Positioning/Branding
“Beauty Cleanser”
Place
Supermarkets, drug stores, mass merchandisers
Price for Profitability
$.29 per complexion bar; $.41 per bath bar
Promotion
$5 million in yearly promotion spending, $3 million of which in TV advertising featured
a beauty expert saying, “Camay, the Beauty Cleanser leaves my face soft, smooth”
Fixed the Disconnects – Changed the Target Market
People
Women with oily skin (about 27% of all women)
Product
High lathering bar soap that cleans really well (removed words “contains cold
cream” from wrapper)
Promise (The Big Benefit)
Beautifully Clean Skin
Positioning/Branding
“Beauty Cleanser”
Place
Supermarkets, drug stores, mass merchandisers
Price for Profitability
$.29 per complexion bar; $.41 per bath bar
Promotion
Same spending, with the expert now saying, “Camay, the Beauty Cleanser, leaves my
face soft, smooth, and not greasy” (as she wipes her hands down, along the sides of
her nose, out across her cheeks)
Camay’s Business Turned Around!
• Because the brand team first focused on:
– What the purpose of marketing was – “create and
sustain demand…”
– And used a standard planning process to deliver that
purpose. Specifically, the team analyzed, strategized,
function-alized, and operationalized –
• Used more Ps!
• Changed the marketing strategy so the target market lined
up with what the product actually did
• Adjusted the advertising slightly
• Implemented the improved advertising
• Results? Sales increased $1 million the following
year.
Today, There are 10 to 11 Ps – the Full
Marketing Mix, Which Marketers Control
People – The target market
Product 1 – Your product; its features
Product 2 – What else has to be there
Promise – The big benefit your product provides
Positioning/Branding
Place/Presence
Price for Profitability
Promotion
Proprietary Parts – Things like patents, trademarks, trade secrets, special relationships
Proof – Not legal proof, but business evidence the above mix will create demand
VI. Summary
Reflection
• What would the Camay brand group have done in
1973, if we had not focused the definition of
marketing on demand and what it would take to
create it?
• If we had not continued to analyze the situation
until it found out what was wrong?
• Had not challenged the role of the 4 Ps, then
expanded them to 7 Ps, in the process subsequently changing Camay’s target market?
• Had simply done more “creative” ads, as our ad
agency wanted?
Do It! Use the MPL to Plan Your
Product’s Marketing
• Plan one product at a time.
• Analyze where your product is at/why; set a goal.
• Do a 1-page Strategic Marketing Plan as a team, or
have some very advanced students do it for you.
• Hold off doing a functional marketing plan.
• Discuss your SMP with me.
• Email me ([email protected]) or call my residence at
208-596-4225 after 5:00 p.m.
So You Want Your Product to Prosper?
Read the book MARKETINGSimpletm for more understanding. Memorize key
parts principles and the process. Adapt the process/concepts as needed:
• Is demand for your product weak?
• If yes, your marketing must create and sustain more demand…
• To do that, use a standard marketing planning process – the
MARKETINGPIPELINE – to actually deliver demand. Take these steps
separately; do not skip any or mash them altogether:
– Analyze and set a goal
– Strategize; use the full marketing mix – the 10 – 11 Ps to line up all of the
drivers of demand; do a full SMP
– Functionalize; plan and work out all key details of an integrated marketing
communication program; set the budget; get top management input and
approval. Without approval, you have no plan.
– Operationalize; measure and correct
– Use the checks
• Work very fast, transparently as a team
• Iterate! Do it over and over and over again! Practice! Get good at it!
• Your marketing can become more and more successful, your business
more prosperous, and your life (and employee lives) more abundant!
End of Unit 1