Managing and Maximizing Your PR and Corporate Communications Budget - ABF Conference Singapore

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  • 1. MANAGING AND MAXIMIZING YOUR PR AND COMMUNICATIONS BUDGET CNI’s Journey, Mistakes, and Lessons Learned Kenny Ong CNI Holdings Berhad
  • 2. Way back in 2004…
    • Thomas Cup, Indonesia
  • 3. Now in 2007…
    • CNI ‘Beemax’ Factory Visit, China
    • Top Leaders
    • Product Development
    • Media
  • 4. Problems from the start
    • No money
    • Split Objectives: Sales? Share Price? Image?
    • Difficult to hire
    • Independent entity
    • Charity center
    • MLM image nightmare
    • Multi-cultural & Multi-lingual
    • Close Regulatory scrutiny (food act, health act, Jakim, KPDN)
    • Public Listed
  • 5. How to fail without trying
  • 6. The Roadmap to Failure Fred Wiersema and Mike Treacy Performance Time Clear Sailing Today’s performance Ad-hoc Tactics Denial & Defense Doom Projections Overdue Failure The Moment of Truth X Performance Freefall Tomorrow’s actual performance Downpresure of Unclear Strategy
  • 7. Denial and Defense
    • “ It’s not really good value our competitor is offering, because it doesn’t include a lot of our features.” - ABC vs Air Asia
    • “ It’s good value but not in our preferred customer market.” - ABC vs Toyota
    • “ Sure they’re hurting us, but with their unfair advantage, what can we do?” – ABC vs MILO
    • “ The rules we are playing by have always worked before” – AMEX vs VISA
  • 8. The Roadmap to Failure Fred Wiersema and Mike Treacy Performance Time Clear Sailing Today’s performance Ad-hoc Tactics Denial & Defense Doom Projections Overdue Failure The Moment of Truth X Performance Freefall Tomorrow’s actual performance Downpresure of Unclear Strategy
  • 9. Ad Hoc Tactics
    • Selectively hold discounts to hold business that has started to go elsewhere
    • Introduce new promotions, terms, conditions, and offers to confuse and cloud the market
    • Beef up customer service by adding people to fix mess-ups and quicken delayed shipments
    • Delay capital investments and adjust accounting methods to portray quarterly financial results more favorably
    • Introduce “new and improved” products that are new in form, but not in substantive ways that are of consequence to purchasers
  • 10. The Roadmap to Failure Fred Wiersema and Mike Treacy Performance Time Clear Sailing Today’s performance Ad-hoc Tactics Denial & Defense Doom Projections Overdue Failure The Moment of Truth X Performance Freefall Tomorrow’s actual performance Downpresure of Unclear Strategy
  • 11. Before moving on…
    • How is PR budget not maximized?
    • Because I can - Competency problem
    • Poor business value – Ignorance problem
    • No Budget lah - Alignment problem
    • Not exciting lah – Glamour problem
  • 12. Contents:
    • How can PR budget be maximized:
    • Linking Comm to the real world of Business
    • Driving WOM as ‘do-or-die’ mission
    • Comm as Integrated affair
    • Virtuous Cycle for full $$ Impact
    • Continuous Networking vs. Fancy Campaigns
  • 13. A. Linking Comm to the real world of Business The anchor for all PR decisions
  • 14. About: CNI
    • 18 years old
    • Core Business: MLM
    • Others: Contract Manufacturing, Export/Trading, eCommerce
    • Malaysia, Singapore, Brunei, Indonesia, India, China, Hong Kong, Philippines, Italy, Taiwan
    • Staff force: ± 500
    • Distributors: 250,000
    • Products: Consumer Goods and Services
  • 15. Intro: MLM
    • Sell through people
    • Buyers = Members (most of the time)
    • Members = Sponsoring
    • Product
    • Integrity
    • R&D
    • Training
    • Functions & Events
    • Tight regulations
  • 16. Intro: CNI
    • CNI’s Business Model background
    Factory CNIE DC SP Leaders Customers R&D
  • 17. COMM Market Research Internal External Leaders Distributors Suppliers Associations Universities NGOs Investors Media Government Public Authorities Proactive Reactive Proactive Reactive COMM Tools COMM Tools
  • 18. What is the purpose of COMM? Ultimate Objective of Marketing: “ Get more people, to buy more things, more frequently, at higher prices.” Sergio Zyman “ Retention and Loyalty are useless if No Conversion is happening.”
  • 19. What is the purpose of COMM? “ Retention and Loyalty are useless if No Conversion is happening.” “ Comm (PR) is useless if No Conversion is happening.”
  • 20. Problem…
    • “ In business after business, 60% to 80% of lost customers reported on a survey just prior to defecting that they were satisfied or very satisfied .”
    HBR March/April 1996
  • 21. What are they really buying?
    • "Exactly what I need"
    • Customized products
    • Personalized communications
    • "They're very responsive"
    • Preferential service and flexibility
    • Recommends what I need
    • "I'm very loyal to them"
    • Helps us to be a success
    "They are the most innovative" "Constantly renewing and creative" "Always on the leading edge" "A great deal!" Excellent/attractive price Minimal acquisition cost and hassle Lowest overall cost of ownership "A no-hassles firm" Convenience and speed Reliable product and service Product Leadership Operational Excellence Customer Intimacy
  • 22. Strategy: Value Disciplines Operational Excellence (low cost producer) Ref: The Discipline of Market Leaders , Michael Treacy & Fred Wiersema; 1995 Product Leadership (best product) Customer Intimacy (best total solution)
  • 23.
    • Product Leadership
    • New, state of the art products or services
    • Risk takers
    • Meet volatile customer needs
    • Fast concept-to- counter
    • Never satisfied - obsolete own and competitors' products
    • Learning organization
    Strategy: Value Disciplines
    • Operational Excellence
    • Competitive price
    • Error free, reliable
    • Fast (on demand)
    • Simple
    • Responsive
    • Consistent information for all
    • Transactional
    • 'Once and Done'
    • Customer Intimacy
    • Management by Fact
    • Easy to do business with
    • Have it your way (customization)
    • Market segments of one
    • Proactive, flexible
    • Relationship and consultative selling
    • Cross selling
  • 24. Strategy: Value Disciplines Operational Excellence (low cost producer) Ref: The Discipline of Market Leaders , Michael Treacy & Fred Wiersema; 1995 Product Leadership (best product) Customer Intimacy (best total solution)
  • 25. Strategy: Value Disciplines Operational Excellence (low cost producer) Ref: The Discipline of Market Leaders , Michael Treacy & Fred Wiersema; 1995 Product Leadership (best product) Customer Intimacy (best total solution)
  • 26. The McPlaybook*
    • Make it easy to eat
    • 50% drive-thru
    • Meals held in one hand
    • Make it easy to prepare
    • High Turnover
    • Tasks simple to learn & repeat
    • Make it quick
    • “ Fast Food”
    • Tests new products for Cooking Times
    • Make what customers want
    • Prowls market for new products
    • Monitored field tests
    *Adapted from: Businessweek , Februrary 5 th 2007
  • 27. How does that impact PR? Philosophy COMM Strategy Corp Comm Strategy Structure Resources Leadership Person
  • 28. Our Philosophy
    • “ We are more than just a business. We strongly believe that every individual has the opportunity to attain a better quality of life and health through CNI.”
  • 29. B. Driving WOM as ‘do-or-die’ mission Big picture, Small picture. PR’s role in both pictures.
  • 30. What is the Objective? Ultimate Objective of Marketing: “ Get more people, to buy more things, more frequently, at higher prices.” Sergio Zyman “ Retention and Loyalty useless if No Conversion is happening.”
  • 31. What is the Objective?
    • Loyalty is Useless…
    • Virtual Consumption vs. Real Consumption
  • 32. What is the Objective?
    • Loyalty is misleading…
    • Heavy Consumption ≠ Loyalty
    • Loyalty ≠ Heavy Consumption
  • 33. What is the Objective?
    • Comm = Relationship (something like Dating)
    • Comm ≠ Media glitz
    • Comm ≠ ATL/BTL/BwTL/ArTL/FTL
    • Comm ≠ CSR
    • Comm = Get more people, to buy more, more frequently, at higher prices
  • 34. What is the Objective?
    • ‘ Do-or-Die’ KPIs for CNI
    • Revenue
    • ARPU
    • Sponsoring
    • Retention
    • Commission Plan (BDP)
    • Product
    • Corporate Image
  • 35. What is the Objective? Sponsoring BDP Why should I join? Credibility Product Corporate Comm
  • 36. What is the Objective?
    • So…the ultimate objective of Corporate Comm is to drive W ord- O f- M outh.
    • That’s it.
    • Now, it’s easy to maximize the budget.
  • 37. C. Comm as Integrated affair Unity is worth more than the annual budget.
  • 38. COMM Market Research Internal External Leaders Distributors Suppliers Proactive Reactive Proactive Reactive COMM Tools COMM Tools Associations Universities NGOs Investors Media Government Public Authorities
  • 39. Integrated affair Conversion Comm S&M MBS CCD [Internal] [External] [Creative]
  • 40. Example: What we needed
    • The birth of Malaysia’s 1 st Tongkat Ali Ginseng Coffee
  • 41. Example: AGM and myCNI
  • 42. Integrated affair - GROUP Group Media CCD CNIE Infuso QP [MLM] [Contract] [Café] CNIH [Invest n ] EM [Export] KESB [eCom]
  • 43. D. Virtuous Cycle for full $$ Impact Feed you, Feed me.
  • 44. COMM Market Research Internal External Leaders Distributors Suppliers Proactive Reactive Proactive Reactive COMM Tools COMM Tools Associations Universities NGOs Investors Media Government Public Authorities
  • 45. Virtuous Cycle Internal External Feed Feed
  • 46. Full $$ Impact Both Sides
    • Internal
    • Halal Committee
    • Social Education (e.g. SCK)
    • Umrah trip
    • China Trip
    • RBOS
    • CFA/HFA
    • Coffee Van
    • External
    • Sponsorship
    • Donations
    • News clippings
    • Newspaper Ads
    • MHI
    • Awards
    • Corporate Profile
    • AGM
    • Gov. Celebrity
    • Analyst research
  • 47. Full $$ Impact Both Sides
    • Internal
    • Entrepreneur Dev.
    • Health products
    • Health education
    • “ Made in Malaysia”
    • Events
    • Media Celebrity
    • External
    • Website
    • DSAM
    • Yayasan
    • Publish Book
    • Social Education
    • Crisis Comm
    • Children Education
    • National interest
    • Analyst BD connections
  • 48. E. Continuous Networking vs. Fancy Campaigns R&D in Totality
  • 49. Remember…
    • Comm = Relationship (something like Dating)
    • Comm ≠ Media glitz
    • Comm ≠ ATL/BTL/BwTL/ArTL/FTL
    • Comm ≠ CSR
    • Comm = Get more people, to buy more, more frequently, at higher prices
  • 50. Example Networking activities
    • Durian Party
    • Wisma Tour
    • Hampers
    • Umrah
    • China Factory Visit
    • Large Events
    • Donations to Media
    • Jakim visit
  • 51. Issues and Challenges Problems, Problems, Problems
  • 52. Sources of Image problems
    • Industry
    Management Staff Frontline Suppliers/Vendors Retail/Distributor
  • 53. Industry-inspired problems
    • Get-Rich-Quick Schemes (Skim Cepat Kaya)
    • Direct Selling myths
    • Bad Hats
    • Imposters
    • Products on Shelves
    • Hazardous products by other companies
    • Increasing Regulations
  • 54. Don’t know how to use to maximum effect
    • ATL
    • Web
    • Blogs (Web 2.0)
    • Mobile
    • Investor Relations
  • 55. IR problems
    • “ Good news for stockholders can be bad news for other stakeholders.”
    • Gregory Miller, Assoc. Prof., Harvard Business School.
  • 56. Summary
  • 57. Summary
    • How to maximize budget?
    • Focus on the right Priority – WOM
    • Drive WOM by Integration and Virtuous Cycle
    • Build Integration and Virtuous Cycle using Constant Networking (hardwork)
  • 58. Thank You. soft copy of slides: http://totallyunrelatedrandomanddebatable.blogspot.com/