Strategic Marketing for the 21st century Filipino

Strategic Marketing for the 21st Century Filipino (Survive and Thrivethe Disasters of Change) Prof. Remigio Joseph De Ungria Jr. Ateneo Graduate School of Business

Professor’s Note The original version of this “Strategic Marketing”presentation was shared with attendees of the 71stNational Convention of the Phil. Institute of ChemicalEngineers (PIChE) held at the DAP ConferenceCenter, Tagaytay on Feb. 18, 2010. This revised version is useful for the 21st CenturyFilipino professional desiring to survive and thrive adefinitely uncertain future. Prof. Bong De Ungria 2

What will OUR story tell?A. Past disastersB. Major changes for last 24 yearsC. 4 Fearless PredictionsD. 4 Strategic Recommendations to Survive and Thrive

Everyday news report everyday disastersEarthquake Bad things thatTsunami happen to usFloodsViolent Crimes Bad= somethingClimate Change we don’t want 4

4 Characteristics of a disaster:1. Worse off after it happens2. Often unexpected3. Life changes as we know it4. Affects us & our loved ones

4 Characteristics of a disaster:1. Worse off after it happens2. Often unexpected3. Life changes as we know it4. Affects us & our loved ones 2012: The Movie The actual disaster was Greater, wider, faster than the prediction. But more survived than expected

How did Typhoons Ondoy and Pepeng affect you?Me- 2 feet of water- P15,000 damageA relative and 2 officemates- lost 200k to 2 M worth of property accumulated over many years; flooding of 2 days to 2 months

How did Typhoons Ondoy and Pepeng affect you?P 212 Billion to repair and rehabilitate- Dr. Yumul, PAG-ASA

Personal lessons from OndoyJust because it did not happen in the last 25 years, does not mean it won’t.Disasters happen when we least expect it & at worst possible time.Past performance does not guarantee future results (typical financial planning advise) 9

Remember Mt. Pinatubo?An inactive volcano for hundreds of yearsAfter its eruption 1. Ash clouds that caused global COOLING 2. Drove out the US bases 3. Instantly wiped out villages 4. Continued destruction years after

“Disasters” also happen in business..1. Lay-offs Why disasters?2. Downsizing3. Rightsizing Lost jobs4. Outsourcing5. Sub-contracting Lost income6. Regionalization Affected workers7. Globalization and their families8. Recession9. Deregulation 11

“Disasters” also happen in business..1. Lay-offs Why disasters?2. Downsizing3. Rightsizing Lost jobs4. Outsourcing What’s the Differenceincome Lost5. Sub-contracting Between6. Affected workers Regionalization A RECESSION And their families and7. Globalization A DEPRESSION?8. Recession9. Deregulation 12

“Disasters” also happen in business..1. Lay-offs Why disasters? RECESSION2. Downsizing Is when3. Rightsizing Your neighbor Lost jobs Loses his Job.4. Outsourcing5. Sub-contracting Lost income DEPRESSION?6. Regionalization Affected Is when workers I lose my Job.7. Globalization and their families8. Recession9. Deregulation 13

My strategic marketing perspective:16 of Ateneo’s 150 years

Since 1994, Active Engagement in…Industry by day, Academe at night

What I saw happen to Filipino companies 1994 to 20111. Shutdown/ sub-contracted2. Shutdown/ imported3. Downsized/ competed globally4. Sold to multinationals/ rightsized5. Shutdown/ regionalized6. New companies opened and thrived

Compare Top 10 corporations revenues/ profits in 10 years 1996 20061.NPC 75B/ 6B 1.San Miguel 250B/ 10B2.Meralco 58B/ 5B 2.Petron 213B/ 6B3.Petron 55B/ 4B 3.Meralco 190B/ 13B4.Shell 48B/ 3B 4.TI 170B/ 5B5.San Miguel 37B/ 6B 5.Shell 157B/ 4B6.Caltex 34B/ 1B 6.PASAR 81B/ 3B7.PAL 31B/ -3B 7.Chevron 77B/ 3B8.PLDT 29B/ 7B 8.PLDT 73B/ 24B9.Nestle 28B/ 2B 9.SMART 68B/ 22B10.Texas Ins 25B/ 0B 10.Nestle 67B/ 6B Source: Philippines Top 7000 Corporations

2 Players dropped out of Top 70 & replaced by non-top 70 1996 2006 1.NPC 75B/ 6B 1.San Miguel 250B/ 10B 2.Meralco 58B/ 5B 2.Petron 213B/ 6B 3.Petron 55B/ 4B 3.Meralco 190B/ 13B 4.Shell 48B/ 3B 4.TI 170B/ 5B 5.San Miguel 37B/ 6B 5.Shell 157B/ 4B 6.Caltex 34B/ 1B 6.PASAR 81B/ 3B 7.PAL 31B/ -3B 7.Chevron 77B/ 3B 8.PLDT 29B/ 7B 8.PLDT 73B/ 24B 9.Nestle 28B/ 2B 9.SMART 68B/ 22B 10.Texas Ins 25B/ 0B 10.Nestle 67B/ 6BNPC and PAL dropped out of the Top 70 Corporations in 2006.SMART and PASAR were not part of the Top 70 Corporations in 1996.Source: Philippines Top 7000 Corporations

Double digit revenue growth butsingle digit profit increase

3 of 8 Top Corporations had >50% decline in profit %Interestingly, Chevron which shutdown its refinerydoubled its profitability and beat Petron & ShellIn profits as % of revenues. (4% vs. 3%)

“Changes” in Top 10 Filipino Corporations (1996 vs. 2006)1. 20% fell off Top 10 & off of Top 70 – NPC (#1), PAL (#7)2. 30% had profits decreased by 50% – SMC, Petron, Shell,3. 10%: profits decreased despite double digit revenue growth – MERALCO4. Two newcomers came out of nowhere to land in Top 10 – SMART, PASAR

What I’ve learned from past1. Change will happen2. Cant stop change – Earthquake, flood – Globalization, Regionalization, Technology3. Can prepare for change4. Must convert threat to opportunity

2 Things 21st Century Pinoys need to survive the future…1. Strategic Marketing Plan (5-20 year)2. Financial Plan (5 - 30 year)

1st Fearless Predictions for the 21st Century Filipino Professional1. Basic concepts remain- Perry’s ChE handbook (first published, 1934; 8th edition 2007) • My father used a 1959 edition • I used a 1981 ed • My son will use a 2015 ed

1st Fearless Predictions for the 21st Century Filipino Professional1. Basic concepts remain- Philip Kotler’s Marketing Management textbook • I used a 1993 edition • 1999: 10th edition • 2008: 13th edition 25

2nd Fearless Predictions for the 21st Century Filipino professional2. Global competition will dictate where jobs will beLocal production only if strategic advantage exists in: • Supply • Operations • Proximitiy to Markets

3rd Fearless Predictions for the 21st Century Filipino professional3. Filipinos will remain globally competitive. Will be hired:Less for knowledgeMore for skills & ability to think beyond what eye can see – Real value creation and contribution to business and shareholder value

4th Fearless Predictions for the 21st Century Filipino professinoal4. Greater chance of success if you have a strategic marketing plan

This Is IT!Four Recommendations for the 21st Century Filipino (To Survive and Thrive the Typhoons of Change)

1. Think and act like a brandYOUYour expertiseYour professional career

12 Principles from Marketing Plan for Life Robert Michael Fried1. Define Business- Who Am I?2. Assess Market- Capitalize on Strength3. ID PTM- Discovering Real Me4. Launch Strategy- Find Niche & Risk5. Weather PLC- Innovate Continuously6. Balance Mix- Build My Brand

12 Principles for a Marketing Plan for Life Robert Michael Fried7. Expand Reach- Create My Legacy8. Campaign Ad- Reawaken Creativity9. Plan Distribution- Share Time & Energy10.Achieve Sales- Reaching Goals11.Analyze P & L- Keep Score12.Seek Opportunities- Make Dreams Real

2. Think and act strategicallyDevelop vision and mission statementsSet annual goals.Implement 5 to 20 year plans.Align often.

3. Develop portable, flexible 7 relevant skills.Love your company and your product.But, realize they may not be around 5 or 10 years from now.Only the fittest survive

4. Continuously learn.Windows- has live updatesMe- learned digital marketing (internet, mobile, email) in 2010… Had to do it; else be left behind

Check out my learning blog…www.josephdeungria.com

Concluding Notes-1 Great Changes are happeningThe 21st centuryhas produced great challengesAnd unprecedented opportunitiesFor the world class Filipino.

Concluding Notes-1Some new companies have emergedwinners by changing the game

Concluding Notes-2 Competition & Customers are more powerful!Today’s challenges of • Globalization • Deregulation • Technological AdvancementsHave exponentially – Increased COMPETITION and, – Empowered the CONSUMER

Concluding Notes-3 People have lost jobs…Many Filipino and Philippine based companiesWhere local professionals used to have lifetime careers have – Closed down – Downsized/ Rightsized – Sub-contracted – Transferred to regional centers

Concluding Notes-4 New opportunities emergedOn the other hand, new opportunitiesRequiring the superior, differentiated competencies of a world class FilipinoHave emerged in industries like – Food – Green Technology – Energy, Power – Internet – Biotechnology

Concluding Notes-5 Strategic MarketingIs a MUSTFor the success of the brandWith your NAME on it.

What did OUR story tell?A. Past disastersB. Major changes for last 24 yearsC. 4 Fearless PredictionsD. 4 Strategic Recommendations to Survive and Thrive

Access this lecture 24/7 @ http://hypermarketing2.com

Strategic Marketing for the 21st Century Filipino (Survive and Thrivethe Disasters of Change) Prof. Remigio Joseph De Ungria Jr. Ateneo Graduate School of Business

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Strategic Marketing for the 21st century Filipino

by Remigio Joseph DeUngria on May 28, 2011

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