A Key Industry Commodity in Critically Short Supply
It had been a long, exhausting two-day session of hearing CEOs and CFOs of company after company tell marketing research, venture capital, and financial analysts why their organizations deserved to receive infusions of capital and "make it" in the marketplace. Each assured the attendees at the American Electronics Association's (AEA) financial conference that they were not only different from the previous speaker but that they had a sound handle on the technology and market.
"You know, you could replace the gene splitter with the system developer, the drive guy with the instrument person, or the software lady with the network person and hardly miss a beat," one of the people at our table commented. "A few of the senior people making the presentations are good marketers. Fewer yet are great marketers. Unfortunately, they are the exception rather than the rule."
A grumble of agreement circled the table.
There was unanimous agreement that for the most part, selling was being confused with marketing by the vast majority of companies making presentations as well as the industry as a whole. Most felt this was especially true about the fast-moving, fast-changing electronics and computer industries.
In some organizations, it seemed that the most outgoing engineer had been given the title and responsibility of vice president or director of marketing. But for the most part, the job of marketing had fallen to a salesperson.
There is nothing wrong with selling. In fact, without good salespeople in the loop nothing good is going to happen for an organization. But selling is just that, selling. Marketing, on the other hand, is knowing where the total industry is going, what is being developed in the industry, and what products are going to be wanted and needed in specific market segments.
There are several different types of "marketing professionals" running today's companies.
First, is the true marketing manager. In my nearly 20 years of developing and carrying out communications programs in the industry, true marketing managers are as rare as natural pearls in a bed of irritated oysters.
Next, is the sales/marketing manager. People in this broad group can be broken down into four categories. They include:
- Those who do not understand all of the marketing functions and surround themselves with experts. They listen to input and rely on others to provide ideas and concepts which are based on logic. They monitor, but let these experts run their part of the show. They orchestrate all of the activities.
- Those who do not understand marketing but are certain they really do. They took a course in ad writing. They have heard of such things as market segmentation and positioning, as well as the interrelationship of R & D, finance, corporate direction, and selling. But to them, there are two distinct areas advertising and selling. And they are mutually exclusive. They will attempt to run the show.
- Those who are excellent salespeople and also understand that their companies have to have such things as a position, image, and research. But they concentrate on those areas and ask only to be kept advised as to what is going on to be protected from their shortcomings.
- Those who know they have goals and objectives because management gave them their sales targets for the year. They know they have budgets because finance gave them the figures on what they could spend in the coming year. If the two have any relationship, it is purely coincidental. They have nothing to do with where the company really wants to be at the end of the year or three to five years from now. Their attitude is generally "Okay, how are you going to squander my money this year?"
Sadly, and mistakenly, management is often perfectly satisfied in having any one of these types. The CEO often does not understand that marketing is, in reality, the hub activity for the company.
Marketing people really have the responsibility of managing the day-to-day business of the firm. With the right people in place, staff groups should look to marketing for leadership and direction.
The reasons are simple. These people are results-oriented. They understand finance, economics, selling, R & D, and how to determine what the next generation of products will be. They are concerned about not just having new, additional products to sell, but how to fit products into market segments and how to package them so they are appealing to the people in those segments.
They do not think in terms of taking what engineering has developed, going on the road to make a few calls, and selling some product. They want to "sell some product," but they want to sell that product to the same target audiences again, and again, and again.
The new wave of choosing heads of marketing for business and industrial organizations is to tap consumer packaged goods people, rather than business-to-business marketers.
When we are discussing such product areas as game software and home computers, perhaps it is a good move. These people are experts in moving products on and off supermarket shelves.
But both consumer and business marketing executives have the ability to recognize needs and mobilize resources. However, instead of heavily relying on advertising and sales promotion, as package goods people do, business marketers contend with complex products and sophisticated tools. These tools include such areas as leasing, sales financing, information systems, capital goods pricing, market stratification/ segmentation, and project bidding.
These are the areas that are growing the fastest in business and industry. Business marketers have, or should have, a grasp of sales management as well as customer service and support. These people know customers on a one-to-one basis, rather than simply dealing with demographics and population concept/profiles.
As a result, the good business marketers are in a better position to approach business and industrial buyers and buying influences from a strategic point of view. Since these "tools of the trade" are used daily, business marketers should have a decided advantage over their consumer goods counterparts for most of the firms in our industry.
The Marketer's Functions
All of this requires planning and planning in an area that is often glossed over or done in a very superficial manner. Some people even mistake their advertising, public relations, and sales promotion/literature programs as being their marketing plan for the coming year.
It is vital to have written corporate or business unit objectives. Management must then set down strategies it will use to achieve those objectives as well as the tactics or actions needed to implement those strategies. These are the guidelines for R&D, finance, production, and marketing.
Marketing has to analyze all of the pertinent aspects of the company's business as well as the competition's activities. This includes a comprehensive understanding of market factors, customer needs, competition, product features/benefits, etceteras. These can then be translated into marketing-related elements of corporate strategy and tactics.
Once this is completed, marketing has to establish the objectives for its individual departments/areas...sales and communications. Marketing's tactical plans will ultimately be the objectives for communications and sales. These departments then establish their own objectives (which are measurable and have a time dimension), strategies, and tactics.
What Lies Ahead
There is still selling and there will always be a need for the person who closes the sale. Everything else is designed to bring two people together.
However, even better, even stronger marketing is needed to reach and satisfy those consumers' needs. That means the marketing strategy has to change or become more professional if the organization is to survive.
Before a single figure is gathered or a report is made, there must first be a commitment to total marketing by management because marketing is the name of the game. This means that every member of management has to understand it, be involved with it, and be devoted to making it work.
Total marketing is an attitude as well as a management tool.
Management should demand a marketing plan that states reasonable marketing objectives and spells out the programs needed to realize those objectives. The action of writing the plan forces all concerned to be specific and be selective. The frills and nonessentials are stripped away, and the work ahead for the company is disclosed for everyone to see. This exposure provides the opportunity for everyone to agree on objectives, action and timing.
By thinking in integrated and coordinated marketing terms, with a plan that is written down and circulated, something strange might happen in our industry products (hardware and software) may be available when they are advertised, not six months to a year later. Unfortunately, no firm today can get away with one to two year pre-announcement efforts.
The most time-consuming element in marketing decision-making is the process of converting the plans or decisions into effective actions. This means assigning specific parts of the plan to individuals, teams, or departments so they can be measured as they proceed.
If people have participated in the development of the plan and have read and understand it, they can then be committed to making it succeed.
Fortunately or unfortunately, as rapidly as our industries are changing, it is impossible to write a plan at the beginning of the year and live by it until the following year. It has to be evaluated monthly with variances noted and explained.
The annual marketing plan should never get away from marketing management. It is essential to stay in control of the plan and be ready to modify it immediately if necessary.
All of the high-tech industry prophets exclaim that there will be a shakeout in the industry. Every organization I have talked with agrees. But, it is going to be the other guy not them. The only way this will be possible is by having a strong, aggressive, seasoned, and highly professional marketing person at the helm. One who can develop total marketing strategy based on thoughtful, creative, and innovative planning.
Unfortunately, there is a critical shortage of these people in the industry. Having an MBA on their resume is no assurance they are going to be able to do the job at hand. It may be helpful, but it is far from necessary.
It may be risky to try to make the future happen, but it is far less risky than assuming nothing is going to change. And that demands marketing people, not retread engineers or sales reps.
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