Thriving with Marketing 3.0g t a et g 3.0
HSM
S P lSao Paulo
November 10, 2010
MARKETING’S LOSS OF EFFECTIVENESS
MARKETING will be less 
effective in the next few 
years
Marketing budgets will be 
lowe...
STRATEGIC vs TACTICAL MARKETING
Most marketing departments are engaged in brand‐maintenance instead of brand‐
building.
Co...
MUST MARKETING BE RE‐INVENTED?
MARKETERS are 
prisoners of an OLD 
PARADIGM
MARKETERS are 
operating in a TIME 
WARP
Compa...
MARKETING 1.0 vs MARKETING 2.0 vs MARKETING 3.0
Product‐centric 
M k i
Customer‐oriented 
M k ti
Value‐driven 
M k i
MARKE...
THREE FORCES SHAPINGTHREE FORCES SHAPING
MARKETING 3.0MARKETING 3.0
The Age ofg
The Age of
The Age ofThe Age of
THREE FORCES SHAPINGTHREE FORCES SHAPING
MARKETING 3.0MARKETING 3.0
The Age ofg
The Age ofThe Age of
The Age ofThe Age ofT...
The Age of
PARTICIPATION & COLLABORATIONPARTICIPATION  & COLLABORATION
E i C ll b ti
LOW‐COST 
INTERNET
Expressive Collabo...
Marketers have Lessening Influence
i Sh i Th i B d Iin Shaping Their Brand Image
P t ti
FOUR POSSIBILITIES
Person‐to‐perso...
P&G’s OPEN INNOVATION Approach
The P&G model exemplifies a starfish because it has no head and is more like 
group of cell...
THREE FORCES SHAPINGTHREE FORCES SHAPING
MARKETING 3.0MARKETING 3.0
The Age ofThe Age ofgg
The Age of
The Age ofThe Age of...
The Age of
GLOBALIZATION PARADOXGLOBALIZATION PARADOX
Information TechnologyInformation Technology
Transportation Technolo...
THREE FORCES SHAPINGTHREE FORCES SHAPING
MARKETING 3.0MARKETING 3.0
The Age ofThe Age ofgg
The Age ofThe Age of
The Age of...
The Age of
CREATIVE SOCIETY andCREATIVE SOCIETY and
HUMAN SPIRIT MARKETING
People in the creative society are right braine...
EVOLUTION OF MANAGEMENT THINKING
1950s – 1960s 1970s – 1980s 1990s – 2000s 2010s – 2020s1950s  1960s 1970s  1980s 1990s  2...
THE FUTURE OF MARKETING
TODAY’S MARKETING  FUTURE MARKETING THE DISCIPLINES 
CONCEPT CONCEPTSOF MARKETING
PRODUCT 
MANAGEM...
CO‐CREATION
Evolution of a company’s relationship to its customers:
Make a Product
Refine the 
Product
Invite 
Customers 
...
THE DORITOS CO‐CREATION CONTEST
Consumers also 
contribute ideas 
f d ti i
The “Free Doritos” advertisement
for advertisin...
COMMUNITIZATION
Consumers want to be connected to other consumers, not to companies.
Companies should help consumers conne...
CHARACTER
For Brands to be able to 
connect with human 
Today’s consumers 
beings who view a brand
can immediatelycan imme...
THE  MODEL OF 3i
brand integrityg y
The GOOD Outdoor‐
Engaged Citizenship
Environmental
inspired Footwear 
and Apparel 
Co...
HYPOTHETICAL STARBUCKS BRAND POSITIONING BULLSEYE
ContemporaryCONSUMER 
Caring Thoughtful
TARGET
Discerning Coffee 
Drinke...
PRIMAL BRANDING
Primal Branding = Brands as a complex belief systems
All have a “primal code” or DNA 
that resonates with ...
BRAND JOURNALISM
Brand Positioning = Brand Journalism
“Marketers should communicate different messages to different market...
Values‐Based Matrix Model
Mind Heart Spirit
INDIVIDUAL
Mind Heart Spirit
INDIVIDUAL
Mission
(Why)
COMPAN
Mission
(Why)
COM...
S. C. JOHNSON VALUE‐BASED MATRIX
MIND HEART SPIRIT
Mission
Contributing to the community 
well –being as well as sustainin...
Marketing the Mission to…
ConsumersConsumersConsumersConsumers
EmployeesEmployees
Channel PartnersChannel PartnersChannel ...
Marketing the Mission to…
ConsumersConsumersConsumersConsumers
EmployeesEmployees
Channel PartnersChannel PartnersChannel ...
CUSTOMERS ARE SUSPICIOUS OF BUSINESS
Since the early 2000s, a string of corporate 
scandals—WorldCom, Tyco, Enron—has made...
Marketing the Mission to
CUSTOMERSCUSTOMERS
Character
Anita Roddick as a  Walt Disney as the creator 
Character
l
Passiona...
Marketing the Mission to…
ConsumersConsumersConsumersConsumers
EmployeesEmployees
Channel PartnersChannel PartnersChannel ...
THE TRIPLE BOTTOM LINE MODEL 
FOR EMPLOYEESFOR EMPLOYEES
To target the minds, hearts, and spirit of current and future emp...
Marketing Corporate Values to
EMPLOYEESEMPLOYEES
A company needs to develop a strong statement of core values.
Often the c...
BENEFITS OF CORE VALUES
Having great core values delivers several payoffs:
ti f t l tA company with values has an advantag...
EMPLOYEES
Care About The Company MissionCare About The Company Mission
50% of MBA graduates said that they were willing to...
MANAGING GLOBALLY THROUGH STRONG VALUES
A big corporation has multiple offices with diverse employees.
Strong values embed...
EMPOWER EMPLOYEES
THREE methods of employee involvement:
Encourage volunteering
A SuperCorp, according to Kanter, is a com...
Marketing the Mission to…
ConsumersConsumersConsumersConsumers
EmployeesEmployees
Channel PartnersChannel PartnersChannel ...
Marketing the Values  to
THE CHANNEL PARTNERSTHE CHANNEL PARTNERS
In MARKETING 3.0, 
collaboration betweencollaboration be...
Selecting Compatible
CHANNEL PARTNERS
Purpose Identity
CHANNEL PARTNERS
Values
Mirroring
Values
Purpose Identity
STEPS IN CHOOSING A CHANNEL PARTNER
Both entities should ask themselves whether both of them desire aBoth entities should ...
MANAGING YOUR CHANNELS
Companies should understand their products’ margin 
contribution, inventory turnaround rate, and ge...
Marketing the Mission to…
ConsumersConsumersConsumersConsumers
EmployeesEmployees
Channel PartnersChannel PartnersChannel ...
THE HUMAN SPIRIT IN THE CAPITAL MARKET 
Touching the human spirit in the capital market is a challenge.
T i h h ld f M k i...
Three Missions 
For the Marketing 3.0 Company
• Bond with Customers
• Improve the Lives of the Poorp
• Sustain the Planet
BONDING WITH CUSTOMERSBONDING WITH CUSTOMERS
Are there any companies that you love or would
deeply miss if they went out o...
Companies Americans Love
Amazon, Best Buy, BMW, CarMax, 
Caterpillar, Commerce Bank, Container 
Store, Costco, eBay, Googl...
Characteristics of “Firms of Endearment”
• They align the interests of all stakeholder groups 
h l l l d• Their executive ...
IMPROVING THE LIVES OF THE POOR
Philips in India positions itself as a “healthcare services provider for rural 
communitie...
MY THREE HEROES
John Wood, Leaving Microsoft to Change the World.
Raised money to build libraries and bring books to Nepal...
PRACTICING SUSTAINABILITY
Most companies, especially public companies, focus on the short term to the 
detriment of their ...
THE SUSTAINABILITY DILEMMA
C i
Companies see sustainability as 
DEFINITION
Companies 
need to see 
the synergy 
between
SU...
THE PROBLEM OF SCARCE RESOURCES
Natural resources are getting scarcer and may not support a 
strong growth in consumption ...
SUSTAINABILITY AND SHAREHOLDER VALUE
A.T. Kearney found that sustainable companies tend to outperform their peers 
during ...
TRACKING SUSTAINABILITY
We need indices that measure how well a company performs in the triple 
bottom line: profit, plane...
Timberland Goes Green 
Timberland is a leader in the design, engineering and marketing of premium‐
quality footwear, appar...
MOVING TOWARD THE MARKETING 3.0
Marketing 1.0 Marketing 2.0 Marketing 3.0
MOVING TOWARD THE MARKETING 3.0
MIND HEART SPIRI...
The ChallengeThe Challenge
• Re‐moralize the marketRe moralize the market
• Re‐localize the economy
• Re‐capitalize the po...
Thriving With Marketing 3.0
Upcoming SlideShare
Loading in...5
×

Thriving With Marketing 3.0

2,278

Published on

HSM ExpoManagement 2010.

Published in: Business, News & Politics
0 Comments
2 Likes
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total Views
2,278
On Slideshare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
79
Comments
0
Likes
2
Embeds 0
No embeds

No notes for slide

Thriving With Marketing 3.0

  1. 1. Thriving with Marketing 3.0g t a et g 3.0 HSM S P lSao Paulo November 10, 2010
  2. 2. MARKETING’S LOSS OF EFFECTIVENESS MARKETING will be less  effective in the next few  years Marketing budgets will be  lower Companies will want  marketers to do more with  lessy DISTRIBUTORS TRADITIONAL  MEDIA COMPETITION SOCIAL MEDIA  NETWORKS PUBLIC DISTRIBUTORS will  demand more TRADE  PROMOTION. This will  leave less money for  marketing research,  Traditional media such  as TV 30‐second spots,  newspapers, etc., are  growing LESS  EFFECTIVE Categories are so  crowded with  competitors that  heavy price cutting will be UNAVOIDABLE The public, in its wish  to spend less, will be  less inclined to pay  higher prices for top  brands where the  Social media networks  will play an  increasingly influential role in shaping brand  evaluationsg , advertising and consumer  promotion for brand  building and ultimately  reduce brand equity.  Investors will then quality differences are  minimal.  There is a  strong shift to store  brands and sub‐ brands This meansInvestors will then  downgrade the stock. This will leave the  company with fewer  resources to prop up  d d brands.  This means  that top brands are  overvalued and there  may be a brand  bubble. demand.  This is a VICIOUS  CIRCLE
  3. 3. STRATEGIC vs TACTICAL MARKETING Most marketing departments are engaged in brand‐maintenance instead of brand‐ building. Company marketers spend only 15 30% of their time doing true marketing activitiesCompany marketers spend only 15‐30% of their time doing true marketing activities.   The rest of the time is spent on forecasting volume, securing approvals on label  artwork, checking manufacturing schedules, and doing routine analysis. Strategic marketing is missing in many marketing departments. Strategic marketing  requires taking a 3‐5 year view of the business. Downstream  Marketing Upstream  Marketing Markets TODAY’s Product Create TOMORROW’s ProductMarkets TODAY s Product Create TOMORROW s Product
  4. 4. MUST MARKETING BE RE‐INVENTED? MARKETERS are  prisoners of an OLD  PARADIGM MARKETERS are  operating in a TIME  WARP Companies aim to maximize profits Don’t acknowledge the growing  power of the customers Company investors are more important  than other stakeholders p Don’t acknowledge the growing  power of the channels and other Customers buy rationally to maximize  value power of the channels and other  stakeholders Don’t acknowledge the new social Customers get most of their information from  sellers and don’t talk to each other about  products Don t acknowledge the new social  media world and their growing   social responsibilities  WE NEED TO….
  5. 5. MARKETING 1.0 vs MARKETING 2.0 vs MARKETING 3.0 Product‐centric  M k i Customer‐oriented  M k ti Value‐driven  M k i MARKETING 1.0 MARKETING 2.0 MARKETING 3.0 Marketing Marketing Marketing Objective Sell products Satisfy and retain the  consumers Make the world a better  place Enabling Forces p Industrial Revolution Information Technology New Wave Technology How companies see  the market Key marketing Mass Buyers with  Physical Needs Smarter Consumer with  Mind and Heart Whole Human with  Mind, Heart, and Spirit d d l iff i i l Key marketing  concept Company marketing  guidelines Product development Differentiation Values Product specification Corporate and Product  Positioning Corporate , Vision,  Valuesguidelines Value propositions Positioning Values Functional Functional and  Emotional Functional, Emotional,  and Spiritual Interaction with  consumers One‐to‐Many  Transaction One‐to‐One  Relationship Many‐to‐Many  Collaboration
  6. 6. THREE FORCES SHAPINGTHREE FORCES SHAPING MARKETING 3.0MARKETING 3.0 The Age ofg The Age of The Age ofThe Age of
  7. 7. THREE FORCES SHAPINGTHREE FORCES SHAPING MARKETING 3.0MARKETING 3.0 The Age ofg The Age ofThe Age of The Age ofThe Age ofThe Age ofThe Age of
  8. 8. The Age of PARTICIPATION & COLLABORATIONPARTICIPATION  & COLLABORATION E i C ll b ti LOW‐COST  INTERNET Expressive Collaborative COMPUTER INTERNET MOBILE PHONE SOCIAL MEDIA Open source ALL THESE MADE IT POSSIBLE FOR INDIVIDUALS TO …
  9. 9. Marketers have Lessening Influence i Sh i Th i B d Iin Shaping Their Brand Image P t ti FOUR POSSIBILITIES Person‐to‐person conversations  about many products can exceed the  amount of communication under the  FOUR POSSIBILITIES Everyone is talking negatively about  the company company’s control. Thus a brand can be hijacked There is no talk about the company The talk is a mix of good and bad  commentsThus a brand can be hijacked. see Alex Wipperfürth, Brand Hijack: Marketing  without Marketing, New York: Portfolio, 2005 comments Virtually all the talk is favorable Managers listened to the  consumers’ voices to understand  Consumers play the key role of  creating the value through co‐ their minds and capture market  insights creation of product and service
  10. 10. P&G’s OPEN INNOVATION Approach The P&G model exemplifies a starfish because it has no head and is more like  group of cells working together. Th i i l P&G’ k f dThe open innovation program leverages P&G’s network of entrepreneurs and  suppliers around the world to provide fresh and innovative product ideas. Olay Regenerist Swiffer Dusters The Crest SpinBrush
  11. 11. THREE FORCES SHAPINGTHREE FORCES SHAPING MARKETING 3.0MARKETING 3.0 The Age ofThe Age ofgg The Age of The Age ofThe Age ofThe Age ofThe Age of
  12. 12. The Age of GLOBALIZATION PARADOXGLOBALIZATION PARADOX Information TechnologyInformation Technology Transportation Technology BUT… (developed nations do better than poorer nations)(developed nations do better than poorer nations)
  13. 13. THREE FORCES SHAPINGTHREE FORCES SHAPING MARKETING 3.0MARKETING 3.0 The Age ofThe Age ofgg The Age ofThe Age of The Age ofThe Age of
  14. 14. The Age of CREATIVE SOCIETY andCREATIVE SOCIETY and HUMAN SPIRIT MARKETING People in the creative society are right brainers in science art and professionalPeople in the creative society are right‐brainers in science, art, and professional  services. Daniel Pink in A Whole New Mind portrayed human evolution: Reliance on muscles  (farmers, blue‐collar  White‐collar executives (Left  Brain) In the Creative Class, Richard Florida shows that the creative sector in the U.S. and  workers)  Artists (Right Brain) , Europe has risen significantly and has a great influence on technology and culture. C. K. Prahalad in his The Fortune at the Bottom of the Pyramid made a strong case on  h i i l i i ihow creativity operates strongly in poorer societies. Consumers are now not only looking for products and services that satisfy their needs  but also searching for experiences and business models that touch their spiritual side.but also searching for experiences and business models that touch their spiritual side.  Supplying “meaning” is the future value proposition in marketing.
  15. 15. EVOLUTION OF MANAGEMENT THINKING 1950s – 1960s 1970s – 1980s 1990s – 2000s 2010s – 2020s1950s  1960s 1970s  1980s 1990s  2000s 2010s  2020s
  16. 16. THE FUTURE OF MARKETING TODAY’S MARKETING  FUTURE MARKETING THE DISCIPLINES  CONCEPT CONCEPTSOF MARKETING PRODUCT  MANAGEMENT The Four Ps (Product, Price, Place,  Promotion) CO‐CREATION CUSTOMER ) The STPCUSTOMER  MANAGEMENT (Segmentation, Targeting,  and Positioning) COMMUNITIZATION BRAND  MANAGEMENT Brand Building CHARACTER  BUILDING
  17. 17. CO‐CREATION Evolution of a company’s relationship to its customers: Make a Product Refine the  Product Invite  Customers  ith i i l ith t i t id id dwith minimal  customer testing with extensive  customer input and  testing to  provide ideas and  co‐create The new ways of creating product and experience through collaboration of companies,  consumers, suppliers, and channel partners interconnected in a global network of  innovation C.K. Prahalad and M.S. Krishnan, The New Age of Innovation: Driving Co‐created Value Through Global Networks, New York:  McGraw‐Hill, 2008 Three key processes of  : 1 2 3 Ask for consumer feedback andIndividual consumersA company creates a1 2 3 Ask for consumer feedback and  enrich the platform by  incorporating all the  customization efforts made by  Individual consumers  customize the platform  to match their own  unique identity. A company creates a  “platform”.  y the network of consumers. q y
  18. 18. THE DORITOS CO‐CREATION CONTEST Consumers also  contribute ideas  f d ti i The “Free Doritos” advertisement for advertising Video of FREE DORITOS The user‐generated ad won theIt h th t t d The user‐generated ad won the  top spot at the 21st USA Today  Super Bowl Ad Meter defeating ads made b professional It shows that user‐generated content can reach consumers  better when it is more relevant  ads made by professional  agencies and more natural in their minds
  19. 19. COMMUNITIZATION Consumers want to be connected to other consumers, not to companies. Companies should help consumers connect to one another in communities and p p support communities Seth Godin, Tribes: We Need You to Lead Us, New York: Portfolio, 2008 POOLS WEBS HUBS –Consumers share the same  values although they do not –Consumers interact with one  another through social media –Consumers gravitate around  a strong figure and create avalues although they do not  necessarily interact with one  another. –They are primarily brand  enthusiasts another through social media  on a one‐to‐one basis. a strong figure and create a  loyal fan base. Susan Fournier and Lara Lee, “Getting Brand Communities Right”, Harvard Business Review, April 2009 enthusiasts.
  20. 20. CHARACTER For Brands to be able to  connect with human  Today’s consumers  beings who view a brand can immediatelycan immediately  judge whether it is  fake real Brands need to develop an  fake or real according to their  authentic DNA that reflects  their identity in consumers’  social networks conversational  experience on the social networks e pe e ce o t e Internet James H. Gilmore and B. Joseph Pine II, Authenticity: What Consumers Really Want, Boston: Harvard Business School Press, 2007
  21. 21. THE  MODEL OF 3i brand integrityg y The GOOD Outdoor‐ Engaged Citizenship Environmental inspired Footwear  and Apparel  Company Environmental  Stewardship Global Human  Rights
  22. 22. HYPOTHETICAL STARBUCKS BRAND POSITIONING BULLSEYE ContemporaryCONSUMER  Caring Thoughtful TARGET Discerning Coffee  Drinker CONSUMER CONSUMER  TAKEAWAY Starbucks gives Responsible,  Locally involved Fairly  Priced 24 hour  training of  baristas Stock option/  health benefits  or baristas CONSUMER  INSIGHT Coffee and the  drinking experience  is often unsatisfying Starbucks gives  me the richest  possible  sensory  experience  d i ki ff Brand Mantra Rich, Rewarding Coffee Experience Relaxing, Rewarding  moments Fresh, high  quality coffee T t ll T i l y g CONSUMER drinking coffee Reach sensory  consumption  experience Convenience,  Friendly  service Varied, exotic  coffee drinks Totally  integrated  system Green &  Earth Colors Triple  Filtrated  water Siren  logo CONSUMER  NEED STATE Desire for better  coffee and a better  consumption  iexperience CONSUMER  INSIGHT Local cafes FastLocal cafes, Fast  food & convenience  shops
  23. 23. PRIMAL BRANDING Primal Branding = Brands as a complex belief systems All have a “primal code” or DNA  that resonates with their  customers and generates their  passion and fervor. SEVEN assets make up this belief system or Primal Code : 1 A Creation Story  2 Creed 5 Sacred Words 6 A way of dealing  3 Icon 4 Ritual with non‐believers 7 A good leader Patrick Hanlon, Primal Branding: Create Zealots for Your Brand, Your Company, and Your Future, Free Press, 2006; www.thinktopia.com
  24. 24. BRAND JOURNALISM Brand Positioning = Brand Journalism “Marketers should communicate different messages to different marketMarketers should communicate different messages to different market  segments at different times, as long as they broadly fit within the basic  brand image.”brand image. ‐Larry Light, former McDonald’s CMO‐ McDonalds is positioned differently in the minds of kids teens young adultsMcDonalds is positioned differently in the minds of kids, teens, young adults,  parents and seniors. It is positioned differently at breakfast, lunch, dinner,  snack, weekday, weekend, with kids or on a business trip., y, , p
  25. 25. Values‐Based Matrix Model Mind Heart Spirit INDIVIDUAL Mind Heart Spirit INDIVIDUAL Mission (Why) COMPAN Mission (Why) COMPAN Deliver SATISFACTION Realize ASPIRATION Practice COMPASSION (Why) NY Deliver SATISFACTION Realize ASPIRATION Practice COMPASSION (Why) NY ProfitAbilit Ret rnAbilit S stainAbilit Vision (What) ProfitAbilit Ret rnAbilit S stainAbilit Vision (What) ProfitAbility ReturnAbility SustainAbility V l ProfitAbility ReturnAbility SustainAbility V l Be BETTER DIFFERENTIATE Make a DIFFERENCE Values (How) Be BETTER DIFFERENTIATE Make a DIFFERENCE Values (How)
  26. 26. S. C. JOHNSON VALUE‐BASED MATRIX MIND HEART SPIRIT Mission Contributing to the community  well –being as well as sustaining  and protecting the environment Promoting reusable  shopping bags Base of the Pyramid For SC Johnson, creating sustainable economic value means helping communities prosper while achieving profitable growth Sustaining Values: SC Johnson Public Report Vision To be a world leader in delivering  innovative solutions to meet  human needs through  t i bilit i i l achieving profitable growth for the company. Reportsustainability principles Values We believe our fundamental strength lies in our l Sustainability We create economic value We strive for environmental  health people.We advance social progress
  27. 27. Marketing the Mission to… ConsumersConsumersConsumersConsumers EmployeesEmployees Channel PartnersChannel PartnersChannel PartnersChannel Partners ShareholdersShareholders
  28. 28. Marketing the Mission to… ConsumersConsumersConsumersConsumers EmployeesEmployees Channel PartnersChannel PartnersChannel PartnersChannel Partners ShareholdersShareholders
  29. 29. CUSTOMERS ARE SUSPICIOUS OF BUSINESS Since the early 2000s, a string of corporate  scandals—WorldCom, Tyco, Enron—has made corporate  values almost meaningless to consumers and employees.values almost meaningless to consumers and employees.    Add to this the recent financial meltdown. In a 2009 survey, only 16% of respondents respect the  integrity of business executives.  And car salesmen and  advertising executives were the least admired byadvertising executives were the least admired by  the public
  30. 30. Marketing the Mission to CUSTOMERSCUSTOMERS Character Anita Roddick as a  Walt Disney as the creator  Character l Passionate Reformer To help women take good  f th i ki d t b of entertainment T d h tiPlot care of their skin and to be  caring persons To produce happy times Metaphor Care Happy Families
  31. 31. Marketing the Mission to… ConsumersConsumersConsumersConsumers EmployeesEmployees Channel PartnersChannel PartnersChannel PartnersChannel Partners ShareholdersShareholders
  32. 32. THE TRIPLE BOTTOM LINE MODEL  FOR EMPLOYEESFOR EMPLOYEES To target the minds, hearts, and spirit of current and future employees, the  company uses THE TRIPLE BOTTOM LINE concept:company uses THE TRIPLE BOTTOM LINE concept: MIND HEART SPIRITMIND HEART SPIRIT Th ’ Th hi Off i th Economic Value Social Progress Environmental  Health The company’s  fundamental strength  lies in our people The company hires  working mothers and  was dubbed as one of  100 best companies Offering the  opportunity to do  what’s right for the  environment and100 best companies  for working mothers environment and  social sustainability
  33. 33. Marketing Corporate Values to EMPLOYEESEMPLOYEES A company needs to develop a strong statement of core values. Often the company will exhibit a central theme: Collaboration:  Cisco, Mayo Clinic Creativity:  3M, Ideo, Apple Family balanced work lifestyle:  S. C. Johnson  Distribute the statement to each employee and to the other  stakeholders Build these values into  the behavior of every employee through training  and example Employees will act as Values Hire new employees who fit these values Eliminate policies Values  Ambassadors Eliminate policies that are not consistent with core  values
  34. 34. BENEFITS OF CORE VALUES Having great core values delivers several payoffs: ti f t l tA company with values has an advantage in competing for talent It can attract better employees and retain them longerIt can attract better employees and retain them longer The productivity of the employees is higher when they have aThe productivity of the employees is higher when they have a  good set of values to guide their actions b iEmployees become better company representatives to serve  the consumers The company is more capable of managing differences  within a wide‐ spread organization
  35. 35. EMPLOYEES Care About The Company MissionCare About The Company Mission 50% of MBA graduates said that they were willing to take  lower pay to work  in a socially‐responsible companyin a socially‐responsible company. Companies that defend their values even when they hurt their business will  get admiration from the employees.get ad at o o t e e p oyees Bagel Works buys smaller bags of flours to avoid back‐injuries to employees that  carry them, although purchases in smaller packaging are more expensive The happiness of employees has a significant impact on their productivity. The Sunday Times’ “100 best companies to work for” outperform the FTSE All Share  Index by between 10% and 15%Index by between 10% and 15% Companies with a social purpose can gain advantage by shaping their  competitive environment.competitive environment. Marriott is educating its employees who may come from backgrounds of limited  education.  By adding education as part of its values Marriott is able to hire better and moreBy adding education as part of its values, Marriott is able to hire better and more  productive employees
  36. 36. MANAGING GLOBALLY THROUGH STRONG VALUES A big corporation has multiple offices with diverse employees. Strong values embedded in every  employee give the company the  Shared values reduce the  differences and integrate the confidence to empower employees  who are distant from the corporate  headquarters. differences and integrate the  employees in one corporate  culture. Companies with strong‐shared values usually succeed  with decentralized or localized decision making. These values help companies not only to standardize but to localize as well.
  37. 37. EMPOWER EMPLOYEES THREE methods of employee involvement: Encourage volunteering A SuperCorp, according to Kanter, is a company that has bigger societal  purposes embedded in how they make money High‐impact volunteering ispurposes embedded in how they make money High‐impact volunteering is  one way to be  a SuperCorp Encourage innovation behaviorg Encourage employees to vote on company issues
  38. 38. Marketing the Mission to… ConsumersConsumersConsumersConsumers EmployeesEmployees Channel PartnersChannel PartnersChannel PartnersChannel Partners ShareholdersShareholders
  39. 39. Marketing the Values  to THE CHANNEL PARTNERSTHE CHANNEL PARTNERS In MARKETING 3.0,  collaboration betweencollaboration between  two business entities is  like a marriage between  two human beingstwo human beings.
  40. 40. Selecting Compatible CHANNEL PARTNERS Purpose Identity CHANNEL PARTNERS Values Mirroring Values Purpose Identity
  41. 41. STEPS IN CHOOSING A CHANNEL PARTNER Both entities should ask themselves whether both of them desire aBoth entities should ask themselves whether both of them desire a  win‐win outcome.  Good partnership creates a horizontal relationship not a vertical one. Each  entity should derive equitably from the collaboration They should investigate whether both business entities uphold a high  quality standard.  Each business entity should identify its potential partner’s unique  values and determine the compatibility with its own unique valuesvalues and determine the compatibility with its own unique values. 
  42. 42. MANAGING YOUR CHANNELS Companies should understand their products’ margin  contribution, inventory turnaround rate, and general  strategic importance to the channel partners.  Companies should demonstrate genuine concern and active  management at the retail level through co‐op marketing in‐management at the retail level through co op marketing, in store promotion, and ensuring a brand’s  “presence” in  retail outlets.  A company should also care and understand its channel partners’  general impressions and satisfactiongeneral impressions and satisfaction.  Aim for company‐channel  integration based on regular  information sharing and joint strategic planning. 
  43. 43. Marketing the Mission to… ConsumersConsumersConsumersConsumers EmployeesEmployees Channel PartnersChannel PartnersChannel PartnersChannel Partners ShareholdersShareholders
  44. 44. THE HUMAN SPIRIT IN THE CAPITAL MARKET  Touching the human spirit in the capital market is a challenge. T i h h ld f M k i 3 0 h d idTo convince shareholders of Marketing 3.0, the company needs to provide  tangible evidence that the practice of sustainability will improve shareholder  value by creating a competitive advantage.  Sustainability The issue is to find a  linkage of between ?? linkage of between  sustainability,  profitability, and  t bilitProfitability Returnability returnability THREE important metrics that can be quantified financially are:THREE important metrics that can be quantified financially are: Improved cost productivity Higher revenue from new market opportunitiesg f pp Higher corporate brand value
  45. 45. Three Missions  For the Marketing 3.0 Company • Bond with Customers • Improve the Lives of the Poorp • Sustain the Planet
  46. 46. BONDING WITH CUSTOMERSBONDING WITH CUSTOMERS Are there any companies that you love or would deeply miss if they went out of business?p y y
  47. 47. Companies Americans Love Amazon, Best Buy, BMW, CarMax,  Caterpillar, Commerce Bank, Container  Store, Costco, eBay, Google, Harley‐ id d O lDavidson, Honda, IDEO, IKEA, JetBlue  Johnson & Johnson, Jordan's Furniture,  L L Bean, New Balance, Patagonia,  P i I REI S th tProgressive Insurance, REI, Southwest,  Starbucks, Timberland, Toyota, Trader  Joe's, UPS, Wegmans, Whole Foods. The researchers found these “firms of  endearment” to be highly profitable. They also found eight characteristics  common to these firms.
  48. 48. Characteristics of “Firms of Endearment” • They align the interests of all stakeholder groups  h l l l d• Their executive salaries are relatively modest • They operate an open door policy to reach top management • Their employee compensation and benefits are high for the category; their p y p g g y; employee training is longer; and their employee turnover is lower • They hire people who are passionate about customers • They view suppliers as true partners who collaborate in improving• They view suppliers as true partners who collaborate in improving  productivity and quality and lowering costs • They believe that their corporate culture is their greatest asset and  primary source of competitive advantageprimary source of competitive advantage. • Their marketing costs are much lower than their peers while customer  satisfaction and retention is much higher.
  49. 49. IMPROVING THE LIVES OF THE POOR Philips in India positions itself as a “healthcare services provider for rural  communities”.  DISHA To improve access to primary  healthcare for low‐income  communities through affordable DISHA (Distance Healthcare  Advancement Project) g services through a specialized mobile  clinic offering low‐cost diagnostics  focusing primarily on “mother and  child” and trauma treatments ConocoPhilips in Venezuela positions itself as “agent of change that develops  skills for women entrepreneurs.” The local community makes a decision on what businesses would be most  appropriate.  The women receive microcredit loans and set up their own small  businesses. 
  50. 50. MY THREE HEROES John Wood, Leaving Microsoft to Change the World. Raised money to build libraries and bring books to Nepal,Raised money to build libraries and bring books to Nepal, especially to further girl’s education. Greg Mortenson and David Oliver RelinGreg Mortenson and David Oliver Relin, Three Cups of Tea: One Man’s Mission to Fight Terrorism and Build Nations…One School at a Time, B ilt h l i P ki t i ll f i lBuilt schools in Pakistan especially for girls. Tracy Kidder, Mountains Beyond Mountains:y , y The Quest of Dr. Paul Farmer, a Man Who Would Cure the World.
  51. 51. PRACTICING SUSTAINABILITY Most companies, especially public companies, focus on the short term to the  detriment of their long term profitability.detriment of their long term profitability. In September 2009, a year after the fall of Lehman Brothers, 28 prominent  figures that include Warren Buffet and Louis Gerstner signed a joint‐figures that include Warren Buffet and Louis Gerstner signed a joint‐ statement to put an end to short‐termism in the financial markets and create  policies that nurture long‐term value creation for shareholders and society.
  52. 52. THE SUSTAINABILITY DILEMMA C i Companies see sustainability as  DEFINITION Companies  need to see  the synergy  between SUSTAINABILITY p y long‐term survival of the company Society sees sustainability as long‐ between  those two term survival of the environment  and the social well‐being
  53. 53. THE PROBLEM OF SCARCE RESOURCES Natural resources are getting scarcer and may not support a  strong growth in consumption in the long runstrong growth in consumption in the long run. Those who manage the scarcity of resources will be the ultimate  winners. In the 1990s industry got on board by trying to cut pollutionIn the 1990s, industry got on board by trying to cut pollution.  In the 2000s, industry then turned to making eco‐friendly  products. Wal‐Mart embraced sustainability in 2006:.  Wal‐Mart pledged to improve its productivity with more  environmentally‐sound practices. It told suppliers to adopt eco friendly practices to qualify as a supplier toIt told suppliers to adopt eco‐friendly practices to qualify as a supplier to  Wal‐Mart
  54. 54. SUSTAINABILITY AND SHAREHOLDER VALUE A.T. Kearney found that sustainable companies tend to outperform their peers  during the financial crisis.during the financial crisis. A 2008 survey by the Economist Intelligence Unit confirmed that there is a link  i bili h ibetween corporate sustainability and strong share price  performance. Executives from companies that put more emphasis on social  and environmental impacts reported annual profit growth of 16% andand environmental impacts reported annual profit growth of 16% and  share price growth of 45% while those from companies that did not put a  lot of emphasis reported annual profit growth of only 7% and share g price growth of only 12%. Moreover, executives believe that the concept of sustainability is good for , p y g corporations in attracting consumers and employees and improving shareholder value
  55. 55. TRACKING SUSTAINABILITY We need indices that measure how well a company performs in the triple  bottom line: profit, planet, and people.bottom line: profit, planet, and people. The AIM: To encourage companies to improve their economic, environmental, and  social impact on the society. Company Approachp y pp FTSE4Good Index  Good companies as companies that work toward environmental  sustainability, have positive relationship with all stakeholders,  protect universal human rights, possess good supply chain labor p g , p g pp y standards, and counter bribery practices Dow Jones  Sustainability Index  Corporate sustainability as “a business approach that creates long‐ term shareholder value by embracing opportunities and managing  risks deriving from economic, environmental and social  developments.”  Goldman Sachs  Introduce the GS Sustain Focus List, which includes the list of  companies with sustainable practices
  56. 56. Timberland Goes Green  Timberland is a leader in the design, engineering and marketing of premium‐ quality footwear, apparel and accessories for outdoor consumers.  It believes  in “doing well by doing good.” In shoes, Timberland uses recycled materials, non‐chemical substances as much  as possible, made in energy‐saving factories. The label gives consumers p gy g g information “about the product they are purchasing, including where it was  manufactured, how it was produced, and its effect on the environment”. Timberland gives back to communities. Under the Path of Service program, itsTimberland gives back to communities. Under the Path of Service program, its  employees have contributed over 200,000 total hours of service that benefited  over 200 community organizations in 13 countries, 26 states and 73 cities. To commemorate Earth Day Timberland plants a tree on behalf of each consumerTo commemorate Earth Day, Timberland plants a tree on behalf of each consumer  who spends $150. Timberland has also done such things as offering $3,000 incentives to employees who purchase hybrid carswho purchase hybrid cars. Other companies in this category are Patagonia, Whole Foods Market, Fetzer Vineyards, and Herman Miller.
  57. 57. MOVING TOWARD THE MARKETING 3.0 Marketing 1.0 Marketing 2.0 Marketing 3.0 MOVING TOWARD THE MARKETING 3.0 MIND HEART SPIRIT PRODUCT‐ CENTERED CUSTOMER‐ ORIENTED VALUES‐DRIVEN CENTERED ORIENTED ECONOMIC‐ VALUE PEOPLE‐VALUE ENVIRONMENT‐ VALUE PROFITS SOCIAL PROGRESS SUSTAINABILITY •Where is your company now? Wh d t it t b ?•Where do you want it to be? •Why? •What would steps would you take? 
  58. 58. The ChallengeThe Challenge • Re‐moralize the marketRe moralize the market • Re‐localize the economy • Re‐capitalize the poor See Phillip Bond – Red TorySee Phillip Bond  Red Tory
  1. A particular slide catching your eye?

    Clipping is a handy way to collect important slides you want to go back to later.

×