MANAGING AND MAXIMIZING YOUR PR AND COMMUNICATIONS BUDGET CNI’s Journey, Mistakes, and Lessons Learned Kenny Ong CNI Holdi...
Way back in 2004… <ul><li>Thomas Cup, Indonesia  </li></ul>
Now in 2007… <ul><li>CNI ‘Beemax’ Factory Visit, China </li></ul><ul><li>Top Leaders </li></ul><ul><li>Product Development...
Problems from the start <ul><li>No money </li></ul><ul><li>Split Objectives: Sales? Share Price? Image? </li></ul><ul><li>...
How to fail without trying
The Roadmap to Failure   Fred Wiersema and   Mike Treacy Performance Time Clear Sailing Today’s performance Ad-hoc Tactics...
Denial and Defense <ul><li>“ It’s not really good value our competitor is offering, because it doesn’t include a lot of ou...
The Roadmap to Failure   Fred Wiersema and   Mike Treacy Performance Time Clear Sailing Today’s performance Ad-hoc Tactics...
Ad Hoc Tactics <ul><li>Selectively hold discounts to hold business that has started to go elsewhere </li></ul><ul><li>Intr...
The Roadmap to Failure   Fred Wiersema and   Mike Treacy Performance Time Clear Sailing Today’s performance Ad-hoc Tactics...
Before moving on… <ul><li>How is PR budget  not  maximized? </li></ul><ul><li>Because I can  - Competency problem </li></u...
Contents: <ul><li>How can PR budget be maximized: </li></ul><ul><li>Linking Comm to the real world of Business </li></ul><...
A. Linking Comm to the real world of Business The anchor for all PR decisions
About: CNI <ul><li>18 years old </li></ul><ul><li>Core Business: MLM </li></ul><ul><li>Others: Contract Manufacturing, Exp...
Intro: MLM <ul><li>Sell through people </li></ul><ul><li>Buyers = Members (most of the time) </li></ul><ul><li>Members = S...
Intro: CNI <ul><li>CNI’s Business Model background </li></ul>Factory CNIE DC SP Leaders Customers R&D
COMM Market Research Internal External Leaders Distributors Suppliers Associations Universities NGOs Investors Media Gover...
What is the purpose of COMM? Ultimate Objective of Marketing:  “ Get more people, to buy more things, more frequently, at ...
What is the purpose of COMM? “ Retention and Loyalty are useless if No Conversion is happening.” “ Comm (PR) is useless if...
Problem… <ul><li>“ In business after business, 60% to 80% of lost customers reported on a survey just prior to defecting t...
What are they really buying? <ul><li>&quot;Exactly what I need&quot; </li></ul><ul><li>Customized products </li></ul><ul><...
Strategy: Value Disciplines Operational Excellence (low cost producer) Ref:  The Discipline of Market Leaders , Michael Tr...
<ul><li>Product Leadership </li></ul><ul><li>New, state of the art products or services </li></ul><ul><li>Risk takers </li...
Strategy: Value Disciplines Operational Excellence (low cost producer) Ref:  The Discipline of Market Leaders , Michael Tr...
Strategy: Value Disciplines Operational Excellence (low cost producer) Ref:  The Discipline of Market Leaders , Michael Tr...
The McPlaybook* <ul><li>Make it easy to eat </li></ul><ul><li>50% drive-thru </li></ul><ul><li>Meals held in one hand </li...
How does that impact PR? Philosophy COMM  Strategy Corp Comm Strategy Structure Resources Leadership Person
Our Philosophy <ul><li>“ We are more than just a business. We strongly believe that every individual has the opportunity t...
B. Driving WOM as ‘do-or-die’ mission Big picture, Small picture. PR’s role in both pictures.
What is the Objective? Ultimate Objective of Marketing:  “ Get more people, to buy more things, more frequently, at higher...
What is the Objective? <ul><li>Loyalty is Useless… </li></ul><ul><li>Virtual Consumption vs. Real Consumption </li></ul>
What is the Objective? <ul><li>Loyalty is misleading… </li></ul><ul><li>Heavy Consumption  ≠  Loyalty </li></ul><ul><li>Lo...
What is the Objective? <ul><li>Comm = Relationship (something like Dating) </li></ul><ul><li>Comm ≠ Media glitz  </li></ul...
What is the Objective? <ul><li>‘ Do-or-Die’ KPIs for CNI </li></ul><ul><li>Revenue </li></ul><ul><li>ARPU </li></ul><ul><l...
What is the Objective? Sponsoring BDP Why should I join? Credibility Product Corporate Comm
What is the Objective? <ul><li>So…the ultimate objective of Corporate Comm is to drive  W ord- O f- M outh. </li></ul><ul>...
C. Comm as Integrated affair Unity is worth more than the annual budget.
COMM Market Research Internal External Leaders Distributors Suppliers Proactive Reactive Proactive Reactive COMM Tools COM...
Integrated affair Conversion Comm S&M MBS CCD [Internal] [External] [Creative]
Example: What we needed <ul><li>The birth of Malaysia’s 1 st  Tongkat Ali Ginseng Coffee </li></ul>
Example: AGM and myCNI
Integrated affair - GROUP Group Media CCD CNIE Infuso QP [MLM] [Contract] [Café] CNIH [Invest n ] EM [Export] KESB [eCom]
D. Virtuous Cycle for full $$ Impact Feed you, Feed me.
COMM Market Research Internal External Leaders Distributors Suppliers Proactive Reactive Proactive Reactive COMM Tools COM...
Virtuous Cycle Internal External Feed Feed
Full $$ Impact Both Sides <ul><li>Internal </li></ul><ul><li>Halal Committee </li></ul><ul><li>Social Education (e.g. SCK)...
Full $$ Impact Both Sides <ul><li>Internal </li></ul><ul><li>Entrepreneur Dev. </li></ul><ul><li>Health products </li></ul...
E. Continuous Networking vs. Fancy Campaigns R&D in Totality
Remember… <ul><li>Comm = Relationship (something like Dating) </li></ul><ul><li>Comm ≠ Media glitz  </li></ul><ul><li>Comm...
Example Networking activities <ul><li>Durian Party </li></ul><ul><li>Wisma Tour </li></ul><ul><li>Hampers </li></ul><ul><l...
Issues and Challenges Problems, Problems, Problems
Sources of Image problems <ul><li>Industry </li></ul>Management Staff Frontline Suppliers/Vendors Retail/Distributor
Industry-inspired problems <ul><li>Get-Rich-Quick Schemes (Skim Cepat Kaya) </li></ul><ul><li>Direct Selling myths </li></...
Don’t know how to use to maximum effect <ul><li>ATL  </li></ul><ul><li>Web </li></ul><ul><li>Blogs (Web 2.0) </li></ul><ul...
IR problems <ul><li>“ Good news for stockholders can be bad news for other stakeholders.”  </li></ul><ul><li>Gregory Mille...
Summary
Summary <ul><li>How to maximize budget? </li></ul><ul><li>Focus on the right Priority – WOM </li></ul><ul><li>Drive WOM by...
Thank You.  soft copy of slides:   http://totallyunrelatedrandomanddebatable.blogspot.com/
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  • Managing and Maximizing Your PR and Corporate Communications Budget - ABF Conference Singapore

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