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Other examples include

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BMW was always known for its executive saloon cars, but eventually recognized that
the high-growth sport-utility vehicle (SUV) market was too good to miss, and it has even
developed a premium range of mountain bikes.

IBM, once known as 'big blue' for its leadership in mainframe computers, stretched into
personal computers, and eventually moved away from hardware altogether into services
and consulting.

Gillette constantly evolves its range of razors, extending them to women, then further
into a full range of body care products too, from shaving gels to deodorants and hair products.

course, if you define your brand around your customers, based on a belief or attitude, a
benefit or aspiration, rather than it being a descriptor of your existing business or product, then
it gives you far more scope and ﬂexibility in the future.

Indeed, in fast-changing markets, 'extensions' are often no longer extensions - they simply
reﬂect the moving centre of gravity of your business as markets and consumers evolve.

Extensions, of course, need to fit somehow with the brand structure - either using the exist-
ing brand strengths as a platform to launch into new markets, or perhaps using a different or
evolved brand in order to give more ﬂexibility and reach new audiences.

There are a number of different brand architectures to consider.

The architectures might be 'monolithic', in that there is total use of the single brand through-
out, a family of different brands, as has typically been the case in consumer goods companies,
or endorsement branding, where a corporate brand 'underpins' more niche-targeting brands.

In the case of a family of brands, these might reﬂect the different market segments (for exam-
ple, Toyota's development of Lexus to target a wealthier audience with a distinctive proposition), different business activities (as in Time, AOL and Warner Bros) or use individual product
brands to strengthen or even reposition the corporate brand (as iPod has so successfully made
Apple cool and desirable again).

How do you bring together the different parts of your business, and different audiences,
through brands? Should you seek to fit everything under one brand? Or are a number of
brands more appropriate to support your different businesses or markets?

1. What you do ........ more here

Consider the current portfolio of
business and products.

2. How inside reflects outside

How do they reflect market and
customer structures.

3. Optional structures

Consider the architectural options -
from 'monolithic brand' to
'house of brands'.

4. Adding value through structures

Identify where sub-brands or
endorsement can increase the
relevance to specific audiences.

5. Choosing the right structure

Map out and articulate this structure,
ensuring that it is practical and
distinctive.

6. Re articulating what you do

Develop identity and nomenclature to
capture this in a logical and
compelling way.

Brands are most conventionally evaluated through the impact of their advertising, and most
typically by the amount of awareness they generate. This is misleading in that it is a measure
of the advertising rather than the brand; second, there is no guarantee that awareness will lead
to sales, and there is rarely a correlation between volume of coverage and profitability.

If we go further and try to relate brands to the sales they generate, then again we are only
getting part of the picture. It is generally accepted that around 60% of the investment in com-
municating brands will drive future revenues, making a correlation between cost and revenue difficult. We therefore need something else which captures the impact of brand building today,
and its potential to drive future business results. This is the role of brand equity.

Brand equity seeks to capture the future potential of the brand, that is, the likely sales that
will be derived in future through the impact the brand has on customers today. We do this by
understanding the attitudes and behavior that the brand drives in its target audiences, then
seek to correlate how these build up and translate into future sales. Of course, their actual
behavior will also be driven by the future context, and additional sales and marketing activity
at the time of purchase.

Brand equity is typically expressed as an index, an amalgam of measures of what you initially
find to be the key drivers of customer behavior. Market research would be used to identify
the prioritized customer attitudinal drivers (for example, for an airline this might be conven-
ience, availability and service levels), then to understand how these drive which behaviours
(e.g. purchase, price tolerance, referral). These are likely to differ by market, by segment and
by product. Ongoing performance against these attributes can then be tracked and collated
as a brand equity score.

To make this most tangible to business, we seek to connect it to financial implications, and
specifically to the likely future revenues, and the costs of generating these. This future cash
ﬂow analysis can then lead to a business valuation, which captures the total likely profits in
subsequent years.

For marketers, value-based analysis of brands and their marketing enables them to reﬂect the
true return on their investments in brands, and to justify significant investments in areas that
may not yet seem the most lucrative, but may well be in the future. It also helps the marketer to
demonstrate to the business, and the business to investors, a significant driver of the business's
overall future potential, and thereby help support its market value.

'Brand value' is often talked about, and seized upon as a key result. In most cases, this refers to
the proportion of the overall value that can be attributable to the brand trademark, i.e. rather
than all the other associated aspects of the brand proposition, including the product and serv-
ice benefits. One way to calculate this value is to imagine that the business does not own its
trademarks, and instead has to pay a third party a fee for its use, and to calculate what this fee
would be over the coming years relative to the potential future profit streams.

A brand's value in this sense is a smaller but still significant proportion of a business's overall
value. At an operational level, knowing the brand value has little direct application, it being far
more useful either in justifying the business's value in an acquisition or disposal situation, or
in justifying the value of the intangible asset for tax purposes.

As the value of intangible assets continues to rise (now at around 75% of the market value of
the Fortune 500), businesses increasingly seek to articulate the value of their intangibles, and
indeed recognize that a business whose value is largely intangible - i.e. tied up in intellectual
properties that will hopefully drive future cash ﬂows - requires a very different style of man-
agement and measurement.

At present international accounting standards only allow such assets to appear on the balance
sheet if they have been acquired rather than organically developed, although these assets can
now be defined more specifically rather than just lumped together as goodwill. Acquired intan-
gible assets can also now be retained on the balance sheet, as long as the acquiring company
can demonstrate that they have not decreased in value each year. Of course, this still means
that the majority of brands and other intangibles that have been developed organically cannot
be accounted for in a formal way.

The famous blue and white BMW logo represents the sky and a moving propeller, and reﬂects its
early days since 1916 spent building aircraft engines. However, the Bayerische Motoren Werke
quickly moved on within a decade to making motorbikes and cars. And, indeed, the emphasis
has been on creating 'the ultimate driving experience' ever since.

There is perhaps no other brand that has retained such an unrelenting focus and consistency
in what it stands for over time. It is a luxury and elitist brand that not everyone can afford,
appealing to people who won't accept second best. While for many years there was just BMW
- no sub-brands, no model names - today it is also the parent company of the Mini and Rolls-
Royce brands.

BMW is a model of branding consistency, not only over time, but in everything it does. The
'ultimate' theme has captured the product excellence of the brand through products and serv-
ices, communications and showrooms. Indeed, a BMW showroom is more like a brand temple,
exuding the values of the brand both visually and experimentally. However, it looks beyond the
showroom to engage potential customers, not all of whom are keen to drive the same car as
their parents drove.

BMW Films, for example, has become an award-winning innovative marketing campaign.
BMW was relatively new to the US market, and also associated with the older rather than
younger executive market. It produced eight beautifully-shot short films, each less than 10
minutes long and made them available only online. TV and press teaser campaigns highlighted
their existence, creating curiosity in its target markets, and letting them find out more if they
wished. The underground campaign became viral as people referred others, and BMW became
a branded designer cult for a new generation.

The unusual approach of restricting access defied the classic rule that you need mass-coverage,
image-based TV and press campaigns to build a brand. Instead, they offered an invitation to
people to find out more on their terms, when they wanted and recommended by their friends.
It also recognized that the same BMW brand needed to be articulated in very different ways
to appeal to different audiences. While the technology-based personalization of messages is
important, it is also the manner of the interaction that matters, in physical relationships; just
because somebody talks to you about something of great interest to you, if they do so in the
wrong manner then you are not interested.

How do you measure the level of engagement that audiences have with your brand, based
on their awareness, their attitudes and behaviours? How do you quantify their future propensity to purchase, based on their current affinity to the brand?

1. Understand brand perceptions

Research the brand's perceived
attributes and their relative importance
to customers.

2. Connect brand to attitudes

Map the customer attitudes (e.g.
preference) that the brand drives,
and the brand's relative impact on them.

3. Connect behaviours to purchases

Understand how these attitudes drive
behaviours that lead to current and
future purchases.

4. Quantify brand's current impact

Quantify the performance of brand
attributes driving current sales.

5. Quantify brand's future impact

Quantify the performance of brand
attributes driving future sales.

6. Measure and track brand equity

Articulate these brand drivers of future
sales as a 'brand equity index'.

BRANDS 2

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Brands are brought to life through people. Brands shouldn't be passive labels and images; they
should be living experiences, where the values and beliefs are demonstrated in relevant and
practical ways for customers, and equally for every other stakeholder group.

This is not simply about focusing on the customer audience, and then requiring employees to
deliver it; it is about making the brand real in relevant ways for employees - and shareholders,
suppliers, governments, etc. - too.

For customers a brand is made relevant through customer propositions, unique to each differ-
ent customer segment and situation, which are then delivered through customer experiences
that ensure that the promises of the brand and proposition become reality.

Similarly for employees, the business should develop employee propositions for each segment
(some will be motivated by career progression, others more by job satisfaction, and others
purely by money). Appropriate employee experiences should then be developed to match the
promise and expectation of each audience.

Once staff are treated in an on-brand way, they are far more likely to respond in a positive way,
i.e. to want to, to be able to, and to be motivated to put in that extra effort to 'live the brand'
and deliver a personal and engaging experience for every customer.

Pret is a sandwich shop. Indeed, its aluminium interiors, accessed through a doorway heralding
that it is 'passionate about food', makes it unlike a normal sandwich shop.

College friends Sinclair Beecham and Julian Metcalfe set up Pret A Manger in 1986 with woe-
fully little experience in the world of business. They created the sort of food they craved but couldn't find anywhere else. They have succeeded too, as the chain has since grown to over 130
shops, mostly in the UK, but also in New York and Hong Kong.

'It's important our sandwiches and sales taste better than anyone else's.'

To achieve this Pret builds a full kitchen at the back of every store. Suppliers are required to
deliver fresh ingredients late every night and then, early the following morning, Pret's chefs get
busy making the best sandwiches, wraps, pastries and cakes. There are no 'shelf life' or 'display
until' dates on Pret sandwiches, as everything is fresh and made on the day, for the day.

'Pret creates hand made, natural food, avoiding the obscure chemicals, additives and
preservatives common to so much of the 'prepared' and 'fast' food on the market today.'

Source: Label on a Pret sandwich

Passion lies at the heart of the brand. Passion for the food they make, and people they employ.
Indeed, go to their website and their 'Passion Facts' describe their passion for natural quality
foods that are free from additives and preservatives, for freshness by ensuring that all food is
made fresh in the shop, and for improvement, constantly seeking to make a better sandwich
with the help of customers.

Despite a minority investment in the business by McDonald's, Pret rejects the conventions
of most fast food brands. Not only does it not offer 'with fries', but it also rejects the mass-
marketing concepts such as advertising, franchising or even focus groups. Indeed, Pret has
learnt by trial and error what works best. In the USA, for example, Pret found no demand for
its all day breakfast sandwich and had to swap butter for cream cheese with smoked salmon.
However, the very-British coronation chicken with mango chutney sandwich was a big hit in
the Big Apple.

Pret offers good jobs to great people who want to make and sell fabulous food. They invest
in their people through training, incentives and rewards, paying them well above the average
wage for the sector. Working at Pret is fun. They work as a team, they enjoy what they do, they
play funky music all day, they wear their own jeans, and they love what they sell.

The service passion of Pret is established by a culture that treats and rewards employees as
equals. Walk into a Pret store at 8 a.m. on a Monday morning and the funky music immediately
captures the mood of the staff. The service is frantic but friendly and personal. Staff are taking
orders, brewing coffee and taking the latest bread and pastries out of the oven simultaneously.
It's a great buzz, which is contagious for customers too, and one that continues throughout the
week to the infamous staff Friday nights out. Although customers aren't invited to those.

The Pret culture isn't scripted or engineered. It is just real and human, frantic and fun.

How do you bring your brand to life? How do you replicate what you do for customers for
internal audiences? How do you ensure that the inside and outside work together? How do
give the brand depth and coherence? How do you make it impossible for anybody else to
copy?

1. Start with the customer promise

Review the Customer Value
Proposition(s) and Experience(s)
that deliver the brand.

2. What do employees want

Understand the needs and motivations
of employees when at work.

3. Make the brand relevant to them

Develop Employee Value Proposition(s)
to engage them in tune with the brand.

4. Make the brand tangible to them

Design Employee Experience(s) to
deliver this in tune with the brand.

5. Connect them to customers

Identify where and how employees
can enhance the Customer Experience

6. Encourage brand behaviours

Develop, encourage and reward these
behaviours, and evolve them over time

As brands become ever more important, companies seek to get more out of them. John
Browne, the CEO of BP, for example, recently made the development of the BP brand a key
strategic objective, creating a new central team to manage and develop it, reporting directly
to him.

As competition intensifies, organizations recognize that brands give them a bridge to other
markets, new geographies or categories, and the ability to sustain a competitive position, par-
ticularly if their existing markets become over competitive or begin to decline.

While brand extensions might seem a no-brainer in terms of making more out of an existing
asset, they can be full of pitfalls. They can jeopardize previously strong reputations, reduce
trust and create confusion in the customer's mind. Some of the more famous stretches too far
include:

Bic, the disposable pen maker, branding underwear and perfume.

Levi's, the jeans company, seeking to enter into men's suits.

Colgate, the toothpaste, with a bizarre move into ready meals.

However, there is a positive side too. When companies do see the potential of new markets,
brand extensions are usually a more successful route than trying to create a completely new
brand, involving less cost and risk. According to David Taylor's research in Brand Stretch, an
extension is typically 23% more successful than a new brand in prompting trial, 34% cheaper,
and 61% better at driving repeat purchase.

When considering how to extend the brand, consider:

Where to extend: reaching new customer groups, or geographical markets, with the same
or new products, such as Tesco entering Eastern European markets, as well as convenience
shoppers.

What to extend: offering related or unrelated products and services under the same brand
to existing or new customers, such as Virgin offering everything from planes and trains to
drinks and phones, often to the same audiences.

How to extend: doing it yourself, or with partners, for example by licensing your brand into
new categories where others have skills, or franchising your existing business concepts to
new markets in return for a royalty fee.

In each of these cases, there is a need for clarity of strategic thinking to ensure that the
extension fits the objectives of the business, to evaluate the potential risks, benefits and value
impact of such moves, and to manage partnerships and new market entries with effective
controls.

Some companies have embraced brand extensions with a strategic objective of diversifying
their business into a broader range of categories (such as Disney), sometimes to spread their
bets in fast-changing markets (like Microsoft), while others have used it as a fundamental
stepping stone to move the core of the business from one activity to another (e.g. GE), and
sometimes because their existing markets are drying up (e.g. Kodak).

Transformational brands

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Do what they seek to achieve better, through improved functionality or support.

Be how they want to be perceived, through a strong identity that gives recognition and is
admired by others.

Belong to a community that they seek to be part of, through improved real or perceived
connections.

Become somebody more than they are, adding personal esteem or the capabilities and
confidence to do what they couldn't otherwise achieve.

Once a brand creates such a strong attachment with people, one that they find emotionally
or practically essential to their lives, then the brand becomes an 'anchor' that can be more
trusted, more permanent and more desired than many other things. Without anchors we can
easily become lost in the maelstrom of competitive intensity. Imagine the drinker who can't get
their favourite drink, or the weekly shopper whose visit to a certain supermarket becomes part
of their routine, or the high-fashion wearer who stays loyal to their favourit designer label.

Anchor brands give people something positive to hang on to, while their markets or even their
personal worlds are constantly changing. This roller coaster of desire and choice can destabilize
even the most confident buyer, creating confusion and anxiety, prompting expense and inse-
curity. More messages, more alternatives, more functionality, more versions, more incentives
 it can all become too much.

Brands that reﬂect people more personally, and do more for them, are likely to be the best
anchors.

Graphic designers hang on to Apple, serious runners hang on to Nike and business leaders
continue to rely on McKinsey. However, brands that seek to serve mass markets, to mean
something to everyone, and therefore struggle to have strong bonds with discrete audiences,
are unlikely to become the chosen anchors. Brands like Marks & Spencer, Reebok or Budweiser
have succeeded by trading on mass popularity, convenience and ubiquity. What made them
great could easily become their biggest handicap.

Levi's is another company trying to find relevance in today's world. When Nick Kaman took his
jeans off in the famous 1983 TV commercial, the world wanted to buy his jeans. It was cool to
be the same. However, in recent years the brand has seen a 65% decline in revenues, despite
its increasingly frantic efforts to revive itself. In the past it was cool to be the same. Everyone
wanted to be like him. Today, to be cool is to be different, and for young people that is likely to
exclude wearing the same jeans as their parents, or even their peers. Today, people are more
different, and therefore brands must reﬂect these greater differences and recognize that to be
king of a niche is better than foolishly trying to conquer the world.

Driving short- and long-term value

Brands attract and retain the best customers and, as a result, are able to charge more, sell more,
more often. This drives improved margins and creates greater certainty of future incomes too.

, brands are increasingly one of the most significant drivers of shareholder value, incred-
ibly valuable intangible assets, increasing the quantity and likelihood of future profits.

These future potential profits, driven by the loyalty of customers to the brand, are often termed
'brand equity', and, indeed, a true reﬂection of the return on investment in a brand is only
achieved by considering the brand equity that can drive current and future profits, rather than
just comparing costs against short-term gains.

However, brands can do even more than this. A strong corporate brand doesn't just drive
improved profits from customers; it also drives employee and shareholder behaviour too. Cor-
porate brands have a strong and direct impact on employee morale, recruitment and retention,
which can obviously ﬂow through into better service for customers, ideas and productivity,
and human capital.

Sears, the Canadian retailer, according to an article in Harvard Business Review, is able to
demonstrate that a 5% improvement in employee attitude drives a 1.3% increase in customer
satisfaction, which drives a 0.5% increase in revenue growth. Sears reﬂects this employee-
customer-profit chain in their business objectives, to create 'a compelling place to work, a
compelling place to shop, and a compelling place to invest'.

For shareholders, as well as the effect of more profitable sales, a strong brand can improve
confidence through a better awareness and understanding of the organization, and a stronger
view of future performance. This perception and reality of reduced risk can lead to improved
credit ratings and lower cost of capital, both of which can have a significant impact on the
economics of the business, as well as encouraging more investment and subsequent improve-
ment in the share price.

Inspiration

Virgin is one of the most diverse brands in the world. Led by their intrepid founder, chairman
and owner Sir Richard Branson, Virgin believes in making a difference, standing for value for
money, quality, innovation, fun and a sense of competitive challenge.

Virgin began in the 1970s with Branson's first venture, a student magazine and small mail
order travel company.

Virgin searches for market opportunities where it can offer something better, fresher and more
valuable than others. It often moves into areas where the customer has traditionally received a
poor deal, and where the competition is complacent. With rapidly growing e-commerce activi-
ties, Virgin often looks to deliver 'old' products and services in new ways. It is pro-active and
agile, leaving bigger and more cumbersome organizations in its wake.

When Virgin starts a new venture, it is based on hard research and analysis. It puts itself in the
customer's shoes to see how it could make things better.

Virgin asks some fundamental questions: Is this an opportunity for restructuring a market
and creating competitive advantage? What are the competitors doing? Is the customer con-
fused or badly served? Is this an opportunity for building the Virgin brand? Can we add value?
Will it interact with our other businesses? Is there an appropriate trade-off between risk and
reward?

Today Virgin's travel operations, led by 51%-owned Virgin Atlantic Airways, are among its big-
gest breadwinners. Virgin Atlantic is complemented by lower-priced cousins Virgin Express in
Europe and Virgin Blue in Australia. The group also operates two UK rail franchises and sells
tour packages through Virgin Holidays.

Some of the group's 200 other businesses include retail stores, music, video, computer games,
balloon ﬂights, beverages, bridal stores, cosmetics, financial services, health clubs, Internet
services, mobile phone services, publishing, and a record label.

The Virgin Group is a family of businesses sharing the same brand, and therefore attracting
similar types of customer, but run independently. Most of these businesses are joint ventures
with other companies, combining skills, knowledge and market presence, as well as investment
and risk. The power of the brand, the network of businesses, and the management style all
contribute to the success of each business.

Virgin sees its role as the consumer champion, with a set of brand values based on the six prin-
ciples that Branson defined as what he wanted Virgin to be about when he first started.

Every Virgin company works hard to make these values mean more, bringing the brand to life
in relevant and innovative ways:

Value for money. Simple, honest and transparent pricing - not necessarily the cheapest
on the market, e.g. Virgin Express and Virgin Blue - low cost airlines with transparent
pricing where you only pay for the basics.

Good quality. High standards, attention to detail, being honest and delivering on prom-
ises, e.g. Virgin Atlantic Upper Class Suite - limousine service, lounge, large ﬂat bed on
board, freedom menu, etc.

Brilliant customer service. Friendly, human and relaxed; professional but uncorporate,
e.g. Virgin Mobile, which has won awards for its customer service, treats its customers as
individuals, and pays out staff bonuses according to customer satisfaction survey results.

Innovation. Challenging convention with big and little product and service ideas; innova-
tive, modern and stylish design, e.g. Virgin Trains' new 'Pendolino' fast tilting train with
shop, radio, digital seat reservations and new sleek design.

Competitively challenging. Sticking two fingers up to the establishment and fighting
the big boys - usually with a bit of humour, e.g. Virgin Atlantic successfully captured the
public spirit by taking on BA's so-called dirty tricks in the mid 1990s.

Fun. Every company in the world takes itself seriously so we think it's important that we pro-
vide the public and our customers with a bit of entertainment, e.g. Virgin Mobile UK launch
was naked people in a transparent phone to show Virgin Mobile had 'nothing to hide'.

Application

What is your big idea? What do you do for people? Who? How? Why is it better and differ-
ent from any other brand? How do you cut through the many complex and psychologically bewildering models of brands to articulate your brand concept in a clear, practical and
compelling way?

. Map the stakeholders

Consider all the stakeholders including
customer, employees, shareholders -
their issues needs and motivations.

2. Functional components

Define functionally what the brand
would do for customers.

3. Differentiated components

Consider competitor brands and
how the benefits would be different
in a positive way.

4. Emotional components

Consider emotionally what your brand
seeks to do for people.

5. Match to stakeholders

Check that these choices are relevant
and can be compelling to all
Stakeholders.

6. Articulate the brand purpose

Capture the core purpose of the brand
in a statement that builds on the
three attributes.

Concept 5

Brands increasingly define the business and, in doing so, what the overall business does for
people. They connect the business to its context, to its customers and all other stakeholders.

Strong brands connect companies with people, both emotionally and practically and, most
importantly, by ensuring the promises become realities over time. Brands define the purpose of
business: they are the glue, the face, the relationship, and the reputation of business.

Disney's former CEO Michael Eisner suggests that 'a brand is a living entity - and it is enriched
or undermined cumulatively over time, the product of a thousand small gestures'.

While brands used to be the domain of individual products, corporate brands are today the
more significant form of branding, more valuable and important entities for customers and
businesses. This is partly due to the rise of service-based business, the increasing awareness
and transparency of the companies behind the products and services we buy, and the need for
higher-order differentiation across the portfolio as well as for individual products.

Even the majority of consumer products now contain the strong endorsement of parent brands.
Whereas in the past many consumers may never have heard of P&G and Unilever despite using
their products daily, today the corporate brand marques appear prominently on the packaging
of everything from washing powder to ice creams.

Organizationally, this means brands take on a broader, higher, non-functional role, rather than
being a functional responsibility of the marketing department.

The brand defines the organization, and all the many stakeholders who work with it. It should
reﬂect the needs and motivations of employees and shareholders, as well as customers. It
overlaps and complements the business strategy and cultural values, and the business should
ensure consistency and alignment between these. It is delivered through HR and investor rela-
tions as well as marketing.

some companies, particularly when there is a strong corporate affairs department, get
confused between brand and reputation, they are one and the same. The corporate reputation
is the corporate brand

The brand is increasingly the most important business asset, often accounting for anything
from 5 to 50% of the overall market value of a company, and in some businesses (be they luxury
goods or not-for-profit) even more. It also becomes a far more complex and essential manage-
ment challenge. BP, for example, considered how to harness the power of its brand across all its
business units and all its stakeholders; it recognized that there was only one person who could
lead this task. CEO John Browne recognized that this was his challenge, and his opportunity, to
create a focused, cohesive and energized business, where his leadership could directly connect
to the desired culture internally and the image and reputation externally.

Corporate brands align the inside and outside, employee and customer, culture and reputation,
behaviours and differentiation, promises and reality.

Branded businesses are therefore about people. Their brand gives them a purpose that also
becomes the organizing idea, the reason for coming to work each day, and a common mission
that brings people together. Logos and identities, straplines and colours become mere short-
hand for a much bigger and more powerful force.

Finding the big idea that defines you

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Finding the big idea that defines you.

Brands are about you, not me.

Brands are about people not products.

Brands are about customers not companies.

A great brand is one you want to live your life by, one you trust and hang on to while everything
around you is changing, one that articulates the type of person you are or want to be, one that
enables you to do what you couldn't otherwise achieve.

More imaginative brands

Passion. Having a passion that captures
the mission and spirit, culture and values of
the brand.

Reﬂective. About your audience not about
you. Reﬂecting them, the benefits they seek,
and the dreams they have.

Activation. Bringing the brand to life for
employees and customers, and one then
reinforcing the other.

Brands were originally developed as labels of ownership. However, today it is what they do
for people that matters much more, how they reﬂect and engage them, how they define their
aspiration and enable them to do more. Powerful brands can drive success in competitive and
financial markets, and indeed become the organization's most valuable assets.

Yet there are few great brands around.

Most brands are still labels, relying too strongly on brand names and logos, and focused too
heavily on the companies and products that they help identify. They are articulated through
superficial strap lines and delivered through generic service. They make promises that the
organization struggles to deliver, often failing to even attract attention, and rarely gaining the
trust of susceptible customers.

Powerful brands have the ability to cut through the noise and competitiveness of markets, and
to engage and retain the best customers in a way that delivers superior financial results in both
the short and long term.

A powerful brand is one that:

Defines a compelling purpose, a big idea that stands out from the crowd, that goes beyond
the product or industry, and really matters to people.

Reﬂects the customer, builds an image and reputation in the mind of the customer that
has personal relevance, even if it alienates others.

Engages customers in together achieving the big idea, delivered in a style through which
people say, 'This is my kind of company'.

Enables customers to do more, reinforcing the benefits and supporting their application,
but also enabling physically or emotionally to do even more.

Anchors customers around something familiar and important, while all else in the market,
or in their personal world, continues to change.

Evolves as markets and customers evolve, with the portability to move easily into new
markets, and the glue to connect diverse activities.

Attracts the target customers, building preference, driving purchase behaviour and sustaining a price premium.

Retains the best customers, building their loyalty, introducing new services and encouraging advocacy.

Drives shareholder value, not only through profits, but also by improving investor confidence, credit ratings and reducing cost of capital.

A powerful brand does all of this. However, a brand that attracts great attention because of its
impressive ads, and that is perceived to be cool and desirable, and drives huge demand, is still
not 'powerful' unless it can also convert this demand into sustained profitability.

and engaging people Reflecting

If brands are about people rather than products, then the big idea around which they are
formed is more to do with what it does for people rather than the company.

There are a million models of a 'brand' - however, in common are three simple components rational, comparative and emotional. By collectively defining what it does for people, differently from anything else, and how it makes them feel, we articulate 'the essence' of the brand.
To be compelling and enduring, this is typically a far more profound idea than product, company or even sector-related benefits. It reﬂects aspirations rather than just needs; it provokes
rather than just informs.

The brand idea is then delivered through every possible medium that the organization can utilize from names and logos to leaders and buildings, products and services to advertising and
brochures, colours and packaging to uniforms and interiors, culture and behaviour to training
and rewards. Every aspect of the corporate or product 'experience' can deliver the brand in tangible and intangible ways. As Jan Carlson, former CEO of airline SAS said, 'every person,
every promise and every action is a moment of truth'.

While business strategy will typically include logical mission statements and objectives, cor-
porate brands capture the essence of why the business exists, and what it does for people.
They use language and symbols that capture the essence of business concepts and customer
promises; they use these symbols as more compelling shorthand to convey them. There should,
of course, be strong alignment between the strategies and brands - both define the business
rationally and emotionally.

Howard Schultz set up Starbucks out of frustration at the coffee quality in his native Seattle;
however, the brand he created is much more than coffee. Schultz explains that he 'identified a
third place, which I really believe sets us apart  not work or home, it's the place our custom-
ers come for refuge.' This drives the product range, the interior design, the service philosophy,
the communications: the tall skinny latte is good, but the known routine and comfortable
environment mean more.

Similarly, other brands give their organizations a core, engaging purpose, which connects all
audiences emotionally in 'why we do business'. Internally, brands stir emotions and energize
people internally and externally to reach for the higher-order benefits that they are working
towards:
For Nike 'to do your best'.

For Coke 'to refresh'.

For Microsoft 'to help realize your potential'.

Even the most dull, boring industrial sector, dealing in so-called 'commodities' like cement or fertilizer can still create strong and compelling brands - look at Cemex or BASF, bringing real

to the worlds of cement that dries faster, or fertilizer that makes your grass
greener.

However, the brand is more than what you do - in fact it is not even what you do. In reality
a brand is defined by how it is received and perceived - the image and reputation that forms
in people's minds. A corporate brand is the reputation of the company. A product brand is the
reputation of the product. Whether you think you are more likely to achieve a personal best
with Nike rather than Adidas, or whether you believe that Coke is more refreshing than Pepsi.

A brand that does more for people, that reﬂects their personal needs and ambitions, that stirs
emotions inside and tingles the hairs on the back of their necks has the making of a powerful
brand. And, of course, if you seek to be special for some people, you will inevitably not engage
others.

A great brand is therefore rarely liked by everyone - it stirs up passions, it polarizes people, it
alienates some, but is loved by others. As Kevin Roberts, worldwide CEO of Saatchi and Saatchi
and author of Lovemarks, says about a brand and its core audience, 'a truly strong brand is one
that you love deeply and unconditionally'.

Enabling people to do more Enabling people to do more

Powerful brands enable people to do what they couldn't otherwise do. They must do more than
simply endorse functional products, either by helping them to do something physically, or by
building confidence and belief in their minds. Sony, for example, is all about helping people 'go
create', encouraging their innovation and inspiring their action, helping them to do what they
couldn't previously achieve.

Brands can typically help people to do more in four different ways

DES IGN I NG YOU R BUS I N ESS F ROM T H E OU T S I DE I N

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DESIGNING YOU R BUSINESS F ROM T H E OUT S I DE I N

Our Credo

We believe our first responsibility is to the doctors, nurses and patients,
to mothers and fathers and all others who use our products and services.
In meeting their needs everything we do must be of high quality.
We must constantly strive to reduce our costs
in order to maintain reasonable prices.
Customers' orders must be serviced promptly and accurately.
Our suppliers and distributors must have an opportunity
to make a fair profit.

We are responsible to our employees,
the men and women who work with us throughout the world.
Everyone must be considered as an individual.
We must respect their dignity and recognize their merit.
They must have a sense of security in their jobs.
Compensation must be fair and adequate,
and working conditions clean, orderly and safe.
We must be mindful of ways to help our employees fulfil
their family responsibilities.
Employees must feel free to make suggestions and complaints.
There must be equal opportunity for employment, development
and advancement for those qualified.
We must provide competent management,
and their actions must be just and ethical.

We are responsible to the communities in which we live and work
and to the world community as well.
We must be good citizens - support good works and charities
and bear our fair share of taxes.
We must encourage civic improvements and better health and education.
We must maintain in good order
the property we are privileged to use,
protecting the environment and natural resources.

Our final responsibility is to our stockholders.
Business must make a sound profit.
We must experiment with new ideas.
Research must be carried on, innovative programs developed
and mistakes paid for.
New equipment must be purchased, new facilities provided
and new products launched.
Reserves must be created to provide for adverse times.
When we operate according to these principles,
the stockholders should realize a fair return.

Source: jnj.com

Concept

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Concept

Strategy is about choices.

Strategy demands a focus of effort, deciding where your priorities lie and, by implication,
deciding what you will not do. This is where organizations become unstuck. They hate saying
no to opportunities and, even more, they hate stopping what they currently do. Many times
has a CEO said, 'We must focus on doing fewer things better', but then finds it all too difficult
to dispose of a long-standing part of the business, or a heritage brand, or to say no to entering
a certain market, or serving particular segments of customers.

We shy away because we aren't completely convinced it's the right thing to do? Because there
might be strong reasons for and against it or, with eternal optimism, one might believe that
an under-performer will come good again. And even if we had total clarity, we still need the
guts to do it, to reject an audience that we have always served, to endure the backlash of a
diminishing audience that hankers after an outdated product. Then there are the implications
for employees, intermediaries and suppliers.

Unilever, the consumer goods company with brands ranging from Persil to Knorr, boldly
announced how it would reduce its brand portfolio from 5000 to 500, and then eventually to
50 brands. While initially these brands were local by-products of acquisitions and easy to sub-
stitute without loss of business through mainstream rebranding, it then got harder as whole
businesses with significant cash ﬂows were stood down.

While rationalizing your portfolio by 99% might seem a little optimistic, most companies could
probably find that 60-80% of what it does is fairly marginal to its overall business performance

Which portfolios should you be considering?

Markets - by geography or sector.

Customers - intermediaries and consumers.

Brands - business units or product ranges.

Products - products and services.

a conventional marketing approach to portfolio analysis would be to consider the 'life
cycle' of products (using the classic revenue growth versus market share Boston Matrix, for
example), this needs to be enhanced with a financial understanding of the likely short- and
long-term returns.

However, while considering the profitability of each entity (market, brand, product, channel)
within the portfolio is useful, this does not identify the real value creators. Considering 'eco-
nomic profitability' raises the bar to incorporate the minimum expected return by shareholders
- i.e. they expect a return of say 9-10% (depending on your business and sector), and 'value
creation' only happens beyond this level.

Economic profit, which is operating profits less the 'cost of capital' (i.e. the minimum expected
return), therefore 'rebases' the criteria for real success.

This enables you to focus on the real 'value creators', and to halt further investments in, or
efforts to sell more of, the 'value destroyers'. Of the latter, even if they appear somewhat prof-
itable, every additional sale will generate revenue, but destroy value. The challenge in these
cases is to re-engineer or reposition the brands or products so that they do deliver an economic
profit, or otherwise to dispose of them in some way.

Inspiration

Enterprise Rentacar prides itself on being 'a big company with the feel of a small business'. In
less than 50 years the company founded by Jack Taylor has rocketed from a single car dealer-
ship to the top of the rental car industry.

Taylor's values were to treat employees and customers like family, and never compromise on
the commitment to superior customer service.

Enterprise has quietly grown to become the largest car rental company in North America by
rejecting the conventional wisdom of focusing on holiday and airport locations.

Instead Enterprise and its 57,000 staff, who all share in the business success, have grown up in
the inner cities, focusing on short-term and replacement rentals. The company now generates
over $7 billion from its 600,000 cars. Previous car rental leaders Hertz and Avis now need to
try even harder.

Enterprise people share an incredible entrepreneurial spirit more associated with a small com-
pany, working customer by customer, car by car, to be the best rather than the biggest. Their
service culture and market focus enables them to charge a market premium, and to rapidly
enter new markets that to the conventional eye would appear saturated.

These principles are the focus of every action, every day, and are captured and sustained
through Enterprise's 'Cultural Compass'. The compass ensures that all employees are focused on
engaging the communities in which they operate, improving diversity throughout the business,
and contributing 'hours and dollars to the causes that matter the most'.

Along the way, Taylor has created thousands of millionaires out of employees who work hard
and share in Enterprise's success, by tying rewards to long-term value creation: 'We are not
entitled to our success. We have to earn it, each and every day'.

Enterprise has recently set about reshaping its business to ensure more success in the future.

Now the largest car rental firm in the US, it is rapidly moving into new markets, particularly
Europe. While the target customer remains those seeking short-term hires for weekends or
while their car is getting repaired, Enterprise is at last testing the airport market too.

Car rental is still its focus, and indeed it recently spun off its non-automotive businesses that
somehow grew with its success - an unlikely portfolio of balloons, footwear, golf courses, hotel
amenities and prison supplies - to form the Centric Group.

Application

Which products should you have in your portfolio? What are your evaluation criteria to
understand their short- and long-term value potential? Which should you focus on, remove,
and add? What difference would this make to the coherence of the portfolio? Similarly, what is the best make-up of your portfolio of markets, your brand portfolio, and your customer
portfolio?

1. Measure profitability

Consider the revenues, profits and
economic profit of each market,
brand, product or customer.

2. Evaluate current performance

Distinguish the value creators from the
value destroyers using current
Performance.

3. Evaluate long-term potential

Evaluate the lifestage and growth
potential of each product
(like a Boston Matrix).

4. Compare relative value

Calculate the NPV of the future profit
streams of each product.

5. Consider the portfolio integrity

Identify any products essential to the
integrity or coherence of the portfolio.

6. Focus on what matters most

Focus on value creators, eliminate
the value destroyers, and re-engineer
borderline cases.

Concept 4

Strategy is about differentiation.

Competitive advantage, as most non-marketers call it, or differentiation, as termed by market-
ers, sits at the heart of any strategy and is the source of business success. In a perfect market,
a commodity will never deliver a return to shareholders beyond their expectations.

Differentiation is the source of added value, of exceeding expectations, of achieving market
and financial performance. It is far more than a name, a colour, a strapline and a few added
extras. It needs to be meaningful and sustainable, strong enough to define the types of people
and capabilities required by the organization, and strong enough not to be imitated by com-
petitors.

'Value disciplines' were developed by Michael Treacy and Fred Wiersema to understand the
orientation that the whole business must embrace in order to achieve leadership. Their theory
provides a simplistic but useful thinking model, and argues that there are three disciplines
through which any company can become a leader in any sector:

Product leadership - these companies have an obsessive focus on innovation and quality
in order to offer the best products. Sony or Coca-Cola are examples.

Customer intimacy - these companies have an obsessive focus on service and relation-
ships in order to offer the best solutions. Dell or Lexus are examples.

Operational excellence - these companies have an obsessive focus on efficiency and con-
sistency in order to offer the best price. Aldi or Toyota are examples.

The model requires that a market leader must be 'good' at all three, but must specifically choose
one area in which to truly excel, to be better than anybody else, and to be known for this as
its source of competitive advantage. Of course, most companies will argue that today they need to be exceptional in all three areas; however, this is unlikely to enable focus and truly
unmatchable difference.

Another reason why differentiation so often seems obvious yet inadequate in organizations
is due to the primacy of the customer. If each competitor does the same market research, and
seeks to meet the same customer needs, then they are likely to end up doing exactly the same
- commodities that meet needs but cannot sustain a price premium. Marketers must work
much harder to interpret and apply strategic thinking, competitive and customer insight, in a
distinctive way.

Application

How can you stand out in highly crowded markets, find a source of differentiation which is
meaningful and difficult to imitate? What are the implications of this positioning for your
whole business in its core competencies, its strategic priorities and its business model? How will you deliver it in words and actions? How is it manifest in your brand, and how will it
tangibly add value to customers throughout their experience with you?

1. Identify the competition

Consider the nature of competition in
target markets: existing and emerging
players, and how they are different.

2. Profile strategic positioning

Evaluate each competitor in terms of
their 'value discipline', both in reality
and how perceived.

3. Profile customer needs

Evaluate customers and segments in
their desire for the value disciplines,
and how it meets their needs.

4. Profile profit patterns

Map the profitability of customers and
competitors, understanding the
the most valuable positions.

5. Choose the best positioning

Select a position that is most attractive
and least competitive for your
brand to be distinctive and successful.

6. Develop value propositions

Consider what it would take to achieve
market leadership in this discipline, and
how to articulate its customer benefits.

Land Rover

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Land Rover

Rover created the first sport utility vehicle (SUV) almost 40 years ago. However, it never
made the most of this leadership, perhaps because it didn't see what it had with sufficient
perspective, and it was those that followed that made the category attractive and profitable.
Meanwhile, Apple strongly inﬂuenced the future market for download music through its hard-
ware and software, establishing a business model that music companies find acceptable, and
competitors find hard to compete against.

On top of this 'leader versus follower' approach is whether you take a market-wide or customer-specific approach. Do you seek to drive or be driven by the market as a whole, or do you
more intimately want to drive or be driven by the need of individual customers? The customer
approach is good in that it is more focused on the niche audience that you specifically seek to
serve, but limited in that it is driven by their needs, while the market itself might be moving in
a different direction.

In the B2B market, where a company may only have a small number of customers, working to
the requirements of the individual customer might build a strong relationship; however, if the
customer loses sight of the market then your own fate is very much in their hands. In reality
you need to pay attention to customers and the wider market.

Bringing these postures together - leading and following, broad and narrow-focus - creates
options for your 'playing style' in the competitive marketplace.

Inspiration

Sky has changed our viewing habits, and our social behaviour too. With more than 17 million
viewers in 7 million UK households, Sky now offers an unprecedented choice of movies, news,
entertainment and sport. Not only that, but it has also been smart in signing up the content
that is most in demand - not least Premiership football - in order to entice terrestrial viewers,
and charges a premium for it.

Sky sees the main benefits of digital technology as the ability to provide greater choice and
ﬂexibility. James Murdoch, Sky's youthful CEO, argues that 'Customers are demanding more
and more in the way they consume media, the way they consume entertainment in the home
with their family.' Sky sees this trend continuing to grow, with more connectivity between
devices, and two or three set-top boxes in many homes.

Sky+ has been the most successful innovation, a personal video recorder, even if the ability to
skip ads could damage more traditional revenue streams for the business. Advertising represents an important 8% of total revenues, and so sees the challenge as 'to think about different
ways and innovative ways to continue to bring brands to consumers in more engaging ways'.
Resolving this dilemma requires more experimentation into interactive forms of advertising,
making them more contextual to programes, and more valuable to customers.

Now that it reaches 30% of homes, the focus has moved from land-grab to profitable delivery.
Sky+ has brought personal choice and recording in a way that Tivo failed to achieve, while the
licensing of its own channels - such as Sky News and Sky Sports - to cable and digital networks
has extended its reach. James Murdoch now has the challenge of sustaining the relentless
growth demanded by his father.

Application

Which markets should you choose to play in? Where are the best emerging opportunities to
create value through a compelling and distinctive proposition for customers that achieves
our strategic goals and delivers value to shareholders?

1. What is adjacent to you?

Consider your current market and
the 'adjacent' markets to it, both
current and emerging.

2. Mapping adjacent dimensions

Map out axis from your current position
based on 'what' (propositions), 'how'
(capabilities) and 'why' (applications).

3. Defining evolving activities

Apply a scale of related activities along
each of these axes, e.g. showing how
an existing proposition could evolve.

4. Connecting the markets

Connect the axes along lines of
decreasing practicality, for example
using high, medium and low.

5. Evaluating their potential

Evaluate possible new markets along
or across the axes in terms of profit,
growth and competitiveness.

6. Selecting new markets

Identify the existing and adjacent
markets best fit and potential
as part of your market strategy.

Marketing decision

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Marketing decision

Marketing decision-making needs to develop a set of criteria that are realistic and appropriate
to the business goals. The choice of criteria can make a huge difference to the decisions you
make, and judgments about what will be successful and what will not.

Marketing choices are often complex, comparing not only alternative approaches - such as
how much to spend on advertising relative to direct mail - but also between dissimilar initiatives - e.g. how much to spend on advertising versus investment in new product development
which may not pay back for many years.

The decisions might come in all shapes and sizes:

Strategic choice of new markets.

Product portfolio rationalization.

Targeting the best customers.

Allocation of marketing budgets.

Structure of brand architecture.

Pricing changes.

Optimization of media mix.

Capital investments.

Performance rewards

We are still tempted to think that biggest is best - however, market share or sales or profits are
not necessarily the best thing to have; and small companies focused in economically profitable
niches can often deliver far better returns than others.

Imagine the European car market where identifying the 'market leader' depends on your crite-
ria for success. Ford might be a clear leader in terms of volumes and revenues. Lexus might lead
the field on customer satisfaction, while Mercedes gains the highest level of loyalty. Volkswa-
gen might come out tops measured on profit. However, if Porsche delivers the best economic
profit, and the best return to shareholders, then it is the rightful market leader.

We jump to the assumption that volumes, market shares and even customer satisfaction are
the key measures of business performance yet, while all are often useful to achieve, there is no
guarantee that any of them will lead to success.

Indeed, the impulsive desire to serve everyone and, worse, to be all things to everyone is the
downfall of many a company. Trying to be all things to everyone, but ending up not being
special for anyone.

piration JET BLUE

Jet Blue is the revolutionary airline that has brought style to a price-discounting market,
offering spacious leather seats, each equipped with 36 channels of live satellite entertain-
ment, while most of its competitors crumbled around it. Launched by David Needle man, Jet
Blue now serves 30 carefully selected US and Caribbean destinations with a ﬂeet of 68 new,
environmentally friendly Airbus A320 aircraft.

The airline succeeds competitively and financially by combining innovative, high-quality serv-
ice with low fares to build a loyal following. Needle man followed his previous successes with
Morris Air, which he sold to Southwest, and Open Skies, a simple yet powerful reservation
system sold to Hewlett Packard. In 1999 he secured $130 million capital funding, rejected the
thinking that 'no-frills' was the only future for airlines, and judged that the time was right to
'bring humanity back to air travel'.

Premium airlines
typically include

• Business focus
• New planes
• In flight service
• Luxury interiors
• Hi-tech facilities

Low-Cost airlines
typically include

• Leisure focus
• Direct sales
• Ticket less
• Simple fares
• Few routes

Jet Blue
combines the alternative conventional
approaches to create a new, distinctive
and profitable airline

The success of Jet Blue has been in choosing what to offer and what not to offer. Instead of
thinking in dimensions of 'full service, high fare' or 'low service, cheap fare', Needleman has
created a different approach. He offers some aspects of full service better than anybody else
- while at the same time eliminating in-ﬂight meals, paper ticketing and the complexity of
round-trip bookings. It is this unique combination that attracts customers, enables radical
differentiation and sustains a high margin.

When asked how he has done it, Needle man identifies four priorities:

Start with lots of money - Jet Blue is the best capitalized airline start up in history, able
to invest leading-edge products.

Fly new planes - Jet Blue's new ﬂeet of aircraft are more reliable and more fuel efficient,
and have faster turnaround times.

Hire the best people - Jet Blue screens new employees rigorously, trains them well and
gives them the best tools, enabling and motivating people.

Focus on service - offer the best experience you can, driving customer retention and word
of mouth recommendations among target audiences

Jet Blue, rather than Southwest Airlines, is now winning all the customer satisfaction awards, a
rare beacon of profitability in a struggling sector, and an inspirational case study for achieving
both customer and business success.

Application

Which markets should you be in? Where are the hot spots and white spaces? How should you
be positioned in these markets? How will you deliver long-term value creation in them?

1. Business context

Understand the wider business
strategy and objectives, and their
implications for markets and marketing.

2. Evaluate the opportunities

Having mapped the broader markets
consider their relative competitiveness
and potential economic value.

3. Where to compete

Choose which markets or sub-domains
the business should focus on to
deliver goals and long-term value.

4. How to compete

Find sources of sustainable competitive
advantage in this markets, and what it
means for products, channels etc.

5. How to win

Design a business model that will
maximize value and relative price
positioning in each market.

6. Strategies for action

Develop marketing and innovation,
brand and customer strategies to
achieve this.

Concept 4.

Strategy is about direction.

Direction depends on where you start. Constantly reshaping the markets where you start
makes a big difference to what you see, and where you might end up. It therefore also requires
perspective (a viewpoint on the potential landscape around you) and posture (how you will
engage with it).

Markets can no longer be put in boxes, drawn with clear borders, and brands don't operate in sin-
gular domains - witness Nike's huge range of watches and eye wear, Bur berry offering a wide range
of shoes in partnership with Dr Scholl, and Stella McCartney's swimwear for Adidas. Brands and
partnerships, fashions and consumers all break down the traditional boundaries for competition.

Having perspective:

Every player is likely to have a different perspective on a market. A key aspect is to understand
market adjacency. The markets adjacent to one player might be different from a competitor
depending on the perspective. Adjacency can be described on any axis, but most typically in

dimensions such as the following:

Customer - who else could the same products be sold to, in their existing or some deriva-
tive form?

Product - what additional products and services do customers seek when they buy ours?
Somebody who buys coffee also wants to buy milk, sugar, biscuits and cakes.

Capability - what other kinds of products and services could we develop using our skills
and knowledge? A paper manufacturer may get into packaging, a restaurant into out-
sourced catering.

Networks - what other kinds of services could use our distribution network?

This will likely generate a high number of adjacent market possibilities, while also demonstrating how many markets are in close proximity, and therefore contain brands probably just as
interested in reaching into your own sector, perhaps creating new forms of competition as they
link previously unrelated capabilities and applications.

Having a posture
Market posture depends on how you relate to others. As markets change, you can either shape
your own destiny or be shaped by somebody else's.

As conventions, standards and regulation rapidly evolve, they are shaped by those who are the
leaders, the innovators, and the most inﬂuential. In the simplest terms, you can be a leader or
a follower:

Leaders can shape new markets on their own terms. They can establish new ways of working, new formats for products, new pricing structures. They can grab the best customers
and seek to retain them. They can charge more for new solutions, while also building barriers to entry or imitation.

Followers can learn from the mistakes of leaders. They can observe which aspects of innovation work, and avoid those that don't. They can imitate and evolve even better ideas.
They can catch the second wave of customers, who are typically more numerous. They can
undercut the leaders, and sometimes make them irrelevant.

Market strategy

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Market strategy

Markets should be the driving force of business strategy, embracing market insight to define
how the external environment is changing, and to identify the biggest challenges and opportunities for business.

Where
should we
play?

Focus resources
on the most
attractive markets

How
should we
compete?

Secure competitive
advantage
in these markets

How
will we
win?

Create an approach
to do this profitably
and in a sustainable way

There are three dimensions to a market strategy:

Where to play - a rigorous analysis of emerging and existing markets, future profit streams
and competitive intensity, leading to choices of which markets to focus on, and which
not.

How to compete - in terms of what to offer customers, how to offer it, and how to be
different from competitors, and thereby how to secure lasting competitive advantage.

How to win - identifying the most appropriate ways to win, even considering new business
models and new criteria for success.

This requires a more stretching vision for the market and what success looks like in it, a more
considered evaluation of what will create and sustain advantage and a more disciplined focus
on the few best opportunities.

It demands tough choices: 'How can I choose between so many great opportunities?' you might
cry after considering the many new areas in which you could grow your business.

Indeed, when markets have no frontiers, when brands increasingly reﬂect lifestyles rather than
any particular product, and when the relentless pace of technology outruns our ability to apply
it, there is no shortage of choices.

Which of the many creative ideas should we make happen?

Which of our customers should we focus our effort on?

Which products should we promote ahead of others?

Which channel partners should we build relationships with?

Making choices

While decision-making at corporate level is typically driven by financial criteria, in marketing
we often fail to apply similar rigours to our decisions. Of course, we fear that the financial
criteria will create short-term, non-customer blinkers. In most cases this is unlikely. It certainly
does not mean doing whatever it takes for 'a quick buck'.

Similarly, marketing decisions are often based more on logic and fit, insight and attractiveness.
These are equally important criteria, which in reality should drive the financial analysis. Of
course, the ultimate criteria for any decision, to decide strategic direction, to approve invest-
ments, or anything else for that matter, should centre on the question 'will this increase the
long-term value of the business?'

In companies owned by shareholders, this typically means 'what will increase the long-term
return to our investors?' which is achieved by growth in the value of their investments, and
dividends they might receive at various intervals.

From the internal perspective this can be addressed in the form of 'will it deliver a return to
shareholders that exceeds their expectations?' or in financial language, 'will it deliver a stream
of economic profits greater than the cost of capital?'

This question is answered by evaluating the likely future profit streams deliverable by the
chosen strategy, in terms of:

Accelerating growth (that is, growth in profits).

Improving margins (ideally economic profit).

Reducing risk (and thereby the lower % by which these future profits are discounted).

Strategy

2009-06-08T06:28:00.000+03:00

Strategy is about direction: clarifying vision and objectives, enabling clarity of organizational purpose, alignment and momentum.

Strategy is about choices: deciding where and how to compete, prioritizing which markets
and customers, which brands and products to focus on.

Strategy is about differentiation: finding a sustainable source of competitive advantage,
and how to deliver it in a compelling, profitable way.

However, most business strategies are inadequate for today's markets. They are developed
without sufficient context, they are developed inside out rather than outside in. They promote
evolution rather than revolution, avoiding hard decisions, seeking to do what is currently done,
even if it is increasingly out of synch with the market. They lack the stretch to see the future

better than the conventional industry wisdom, and the ﬂexibility to adapt to changing markets.
They are often developed remotely from those who must be engaged to make them happen.
They fail to make the difficult choices of audiences or products or priorities - choices which
people are not often fond of making, and are unlikely to be favourable to everyone. They forget
to put competitive advantage at their core.

As a result, strategies are devalued as a paper exercise to justify budget submissions, compromised as soon as the people are asked to stop doing what they have always done, but don't
want to, and end up being rather similar to the strategy of every other company in the sector.
They lack the decisiveness, direction and focus that a business needs today.

Strategy itself is a widely misunderstood term. As a word it is often misused as tactics - 'What is
our strategy to win this sale?' - or as a plan - 'What is our strategy for next year?' The reality is

that strategy is about a sustained approach, requiring ﬂexibility and review in a fast-changing
world, but typically scoped over at least three years.

Corporate strategy is about the overall organization's purpose, the mission of the company, and the vision of what such will look like. This drives what business areas we should
be in. It sets the context. Brand values and culture should align to this, providing a clear
articulation of the purpose in a way that captures the difference from others, and how it
is relevant to the audience.

Business strategy typically refers to a specific business unit, e.g. sports cars, trucks, aerospace. At its simplest it defines where and how to compete in each chosen market, and
the business model and resources which will be required in order to achieve this.

Market strategy is the core part of the business strategy, and offers marketers a 'higher
domain' in which to inﬂuence the business direction, focus and priorities.

Marketing strategy is then more functional and operational - defining how brands, prod-
ucts, channels and communications must be developed and deployed in order to achieve
success.

Novartis provides a great example of market thinking driving the business. R&D companies,
like technology companies, are typically driven by their products rather than their audiences. A
drug development pipeline could last for 10 years, for example. In Nonpartisan, the marketing team
drive the strategy, and thereby the strategic prioritization of new investments and innovations.
While the pipeline is determined by highly technical inside-out opportunities, it is the outside-
in market perspective that drives its priorities.

Outside in

Strategy development so often starts with where are we now, rather than where could we be?
'Where are we now' thinking is typically an internal perspective of what products and capabilities do we have, and how can we use them at less cost to drive more revenues? Yet, while the
blinkers are on improving current performance, the market and the best opportunities might
be passing the organization by. In fast-changing markets, improvement is increasingly a route
to irrelevance.

Markets are the source of change, disruption and possibility today. Markets change at a far
greater pace than companies. Therefore, the best opportunities, the best strategies and best
performance are typically arrived at by anticipating and responding to external change.

The demand for improved results, faster growth and higher margins merely shapes the challenge rather than provides a solution. The solution comes by thinking 'outside in' - where are
the best markets? What is the best fit with our brand? How can we seize these opportunities
better than others? What products and services will we need? Will it deliver a superior return
for our shareholders in the long term?

While 'core competence' thinking used to be the foundation of where to focus, 'market opportunity' thinking now matters more. Of course, there is a balance between the two perspectives and
the point is that where you start defines the frame of reference for everything that follows

best opportunities for your business

2009-06-07T06:27:00.000+03:00

Where are the best opportunities for your business today? How do you stand out in
crowded markets? How do you deliver the best solutions for customers, and the best
returns to shareholders?

Where should you focus amidst this complexity? What is your competitive advantage?
Which markets, brands, products and customers should you prioritize in order to maximize
value creation?

What is your defining purpose? How do you reﬂect the aspirations of your stakeholders? How
could you make more of your brand, in new markets or applications? And how do you capture
its full impact over time?

Who are the customers for your business? How do you gain real insight into what they want?
How do you embrace CSR, and address wider ethical issues? How do you create a truly customer-centric business?

How do create more radical innovation? How do you disrupt the existing market conventions in order to create a significant and sustainable difference? How do you innovate
markets and business as well as the solutions themselves?

Designing your business from the outside in.

'What do you want to achieve or avoid? The answers to this question are objectives.
How will you go about achieving your desired results? The answer to this you can call
strategy.'

William Rothschild

'Ultimately, we wanted Nike to be the world's best sports and fitness company. Once you
say that, you have a focus. You don't end up making wing tips or sponsoring the next
Rolling Stones world tour.'

Phil Knight

Most business strategies are inadequate for today's markets. They lack context and difference,
ﬂexibility and engagement. They often miss the bigger opportunities, and avoid the more difficult but important choices for business. They are more about consensus than competitiveness,
standing still rather than moving forwards.

More imaginative strategy

Driving. Defining markets in your vision,
challenging conventions, and shaping them
to your advantage.

Visionary. Creatively defining future
markets, driven by what you could do rather
than what you can do.

Innovative. Ensuring that innovation drives
both today and tomorrow, driving demand
and profitable growth.

Marketing should be the driving force of business strategy, ensuring that it is driven by the
challenges and opportunities in markets, and defining where and how to compete, and how
to win.

Remember All the time (Note)

2009-06-06T23:00:00.000+03:00

Dear Marketer always remember the following

'Extraordinary people visualize not what is possible or probable, but rather what is impos-
sible. And by visualizing the impossible, they begin to see it as possible.'

Cheri Carter-Scott

'Keep in mind that you cannot control your own future. Your destiny is not in your hands;
it is in the hands of the irrational consumer and society. The changes in their needs,
desires, and demands will tell you where you must go  This means that managers must themselves feel the pulse of change on a daily, continuous basis  They should have intense curiosity, observe events, analyse trends, seek the clues of change, and translate those clues into opportunities.'

Michael Kami

'Unless you are prepared to give up something valuable you will never be able to truly
change at all, because you'll be forever in the control of things you can't give up.'

Andy Law

'They are playing a game. They are playing at not playing a game. If I show them I see
they are, I shall break the rules and they will punish me. I must play the game, of not
seeing I see the game.'

Kevin Kelly

'The rise of an information age doesn't mean we stop producing or selling. We still need
products and services. But it does mean that the business and marketing strategies
that made sellers' brands powerful yesterday won't necessarily keep them tomorrow. If
it's not a win-win for both sides, one side or the other will see no reason to pursue the
relationship.'

Alan Mitchell

'The web enables total transparency. People with access to relevant information are
beginning to challenge any type of authority. The stupid, loyal and humble customer,
employee, patient or citizen is dead.'

Kjell Nordström and Jonas Ridderstråle

Markets increasingly drive the business, yet marketers are not in the driving seat. Marketing is
still too often seen as a peripheral function, a specialist community, a drain on expenditure, a
support to the sales team.

Marketing is much more than this: a process for the whole business, although it may require
some specialist practitioners too. It drives demand in the short and long term. It fuels profits,

One is not born a genius, one becomes a genius.

'In every work of genius we recognize our own rejected thoughts.'

Ralph Waldo Emerson

intelligence and imagination 2

2009-06-05T19:30:00.000+03:00

Intelligence

Everything is relative. Speed, mass and time are all subjective measures, all dependent on
each other. Nothing is absolute, be it the age and motion of a human being or extra-terrestrial
planet. Light has weight and speed has curves. And coiled within a pound of matter, any matter,
is the explosive power of 14 million tons of TNT.

We know all of this because of Albert Einstein. In a few elegant characters he formed a simple-
looking equation that governs our world and every other world out there.

In his youth, Einstein was fascinated by models and mechanical devices, yet he was considered
a slow learner, possibily due to dyslexia, or shyness, while others have referred to an unusual
brain structure (which was removed and examined after his death). Indeed, he credited his
greatest breakthroughs to his slowness, saying that by making sense of things at a later age
than most children, he was able to apply a more developed intellect.

Einstein was no quiet, subservient student. Indeed, he was difficult, prickly, and constantly
annoyed his professors. They were probably relieved when he became a patent clerk in his home
town of Bern, Switzerland. He was confident, arrogant, extreme and unkempt. The picture of
the mad scientist, or perhaps genius. While a rigorous mathematician, his curiosity saw pat-
terns and provoked him to hypothesize 'what if'. Indeed, these leaps in imagination, then proved
through his deeply intelligent algebra, perhaps helped to achieve his extraordinary progress.
In 1905, at 26 years of age, Einstein sent three papers, scrawled in his spare time, to the lead-
ing journal Annalen der Physik, asking for them to be published 'if there is room'. They were
all published, and went on to provide the foundation of modern physics and, in some ways, to
change the world.

The papers were about:

Photoelectric Effect. This described how light travels as both waves and particles, and led
to the development of quantum mechanics.

Brownian Motion. This explained how particles bounce around in a seemingly random way,
illustrating their atomic composition.

Special Relativity. 'This paper,' he modestly wrote, 'modifies the theory of space and time'
by explaining how everything is relative rather than absolute.

Einstein was a genius. Only the first of the papers won a Nobel Prize, although many argued
that all three should have done. The third paper, however, is perhaps the most famous and led
to his subsequent explanation that energy is equivalent to the combination of mass and speed
of light, E=mc 2, and that nothing can therefore exceed the speed of light.

Another leading physicist of the time described Einstein's papers as 'blazing rockets which in
the dark of the night suddenly cast a brief but powerful illumination over an immense unknown
region.'

Steve Jobs, the scientifically-trained originator of iMacs and iPods, embraces many of the
attributes of the intelligence required of a genius marketer, driven by a deep understanding of
his field but, like Einstein, requiring leaps of imagination in order to achieve his breakthrough
solutions.

Pablo Picasso, or to give him his full and original name, El Pablito (Pablo) Diego José San-
tiago Francisco de Paula Juan Nepomuceno Crispín Crispiniano de los Remedios Cipriano de
la Santísima Trinidad Ruiz Blasco y Picasso López, was primarily a painter (he believed that an
artist must paint in order to be considered a true artist) but also worked with small ceramic
and bronze sculptures, collage, and even produced some poetry.

He was a talented painter and draughtsman, partly following in his father's footsteps, Jose Ruiz
y Blasco, who was also a painter and professor of art at various Spanish colleges. However,
Pablo chose to adopt his mother's name, and went on to create masterpieces in oils, watercol-
our, pastels, charcoal, pencil and ink.

Picasso was also a genius, challenging the impressionist conventions of his time. Having
patiently absorbed the work of Manet and Toulouse-Lautrec, he combined his Spanish passion
and visual talents to define the new art form of Cubism, delighting in reducing complex scenes
to just a few geometric shapes, and become a rare legend in his own lifetime.

His modern art was born of visual creativity, although building on the increasing 'science' of his
tutors. However, to create Cubism at a time when Impressionism was still the popular prefer-
ence was bold and daring. Indeed, Pablo was a rebel from the start, a teenager who frequented
the Barcelona cafés where the revolutionary-thinking intellectuals gathered. Within years
of arriving in Paris he had absorbed the Impressionist genre and in his own mind had a new
expression bursting to get out.

Philippe Starck, the designer of everything from the Microsoft Mouse to the Paramount Hotel,
embraces many of the attributes of the imagination required of a genius marketer, driven by a
radically creative, non-linear, intuitive approach but, like Picasso, also with an intelligent logic
underpinning his radical solutions.

Warren Buffett is a genius. He is widely regarded as the world's greatest stock market investor,
yet still lives in the same grey stucco house that he bought in his twenties for $31,000. He dines
on burgers and Coke, plays bridge with Bill Gates, and frequently quotes Mae West. His only
extravagance is his fondness for luxury air travel, and his Gulfstream IV-SP jet.

If his lifestyle is offbeat, then so is his investment strategy. He rejects the complex trickery
of day-traders and hedge funds, instead founding his business choices on common sense and
information and intuition. Buffet has a great knack of spotting undervalued companies with
low overheads and high growth potential - strong market shares. He buys them on the cheap,
and then watches them grow. In 1988 he recognized the strong brand, but unfulfilled financial
potential of Coca-Cola. He bought shares at $10.96 and within five years, partly due to investor
confidence following Buffet, they were worth $74.50.

Known as 'The Oracle of Omaha', thousands gather each year for the AGM of his company Berk-
shire Hathaway, to hear the great man perform, to talk about his own company, and the state
of the world as he sees it. This is no usual AGM. It starts with a song from Warren, reﬂecting his
great love of Country and Western music. There is usually a movie too, most recently featuring
Warren in a version of The Wizard of Oz, put together by his daughter. Bill Gates even has a look
in, both as a character in the movie, and by joining the company as a non-executive director.

For all this eccentricity and normality, he is one of the world's most respected business leaders,
and his annual letters to shareholders of Berkshire Hathaway are read by many more millions
for their insights and inspiration. His personal wealth is estimated at $36 billion, with at least
one-third of that due to his significant ownership of Coke.

Phil Knight, the founder of Nike who grew his business from the back of his van to a $12 billion
global leader, embraces many of the attributes of the combination and balance required of a
genius marketer, to bring together the deep intelligence and radical imagination to achieve the
extraordinary results of Buffett, achieved through a marketing-driven business.

Inspiration

Steve Jobs has redefined the marketing of technology, from the early days of Apple's Macin-
tosh to Pixar blockbusters like Toy Story, and back to defining our iLife at Apple. He is a market
revolutionary, intelligently making sense of markets and applying technologies to existing and
emerging customer needs.

He grew up in the Californian apricot orchards that later became known as Silicon Valley, at a
time when technological innovation and psychedelic music were competing local inﬂuences.
He studied physics and literature but dropped out to found Apple Computer with his friend
Steve Wozniak in 1976, based in his parent's garage and financed by the sale of his VW camp-
ervan. By the age of 23 he was worth over $1 million, over $10 million by 24, $100 million by
25, and now a fully ﬂedged billionaire.

He grew the business by focusing on niche markets, charging a premium for his novel prod-
ucts. However, 1985 saw him lose out in a power struggle with John Sculley as Apple began
to crumble under the competitive might of Microsoft. This led him to Pixar animation studios,
which has since created some of the most successful and loved animated films since the early
days of Walt Disney. From Monsters Inc. to Toy Story and Finding Nemo, they have earned well
over $2 billion at the box offices.

Back at Apple Computer, with Jobs reinstalled as leader, Apple recognized that the computing
world had changed. In the same way that Pixar had transformed movies, the likes of Dell had
disrupted the computing world. But Jobs saw the future differently. He re-engaged his passion
for well-designed computers, this time with open systems, and the launch of his funky-coloured I Macs. More significantly, he recognized that the music industry was in desperate need
of innovation. The iPod was born to a new generation of devices, and iTunes closely followed.

Jobs is on a high - with over 10 million iPods in circulation, profits at Apple have increased
fivefold, and at Pixar, The Incredibles has packed out cinemas around the world. His annual
performances at MacWorld are still watched by millions, eager to hear his perspectives on fast-
changing landscapes, and specifically about his latest ideas and innovations.

Jobs takes a deeply personal approach to business - a visionary and a strategist, with a hands-
on style to the detail of customer needs and product design. He is a marketer and leader who
inspires superlatives. His staff describe him as a 'reality distortion field'.

Inspiration

Philippe Starck is the grand fromage of design. From architecture to furniture, utensils to fash-
ion, Starck puts his mark on around 100 products every year.

'Everyone should be pondering, asking themselves questions about life, money, desire, war,
themselves,' he believes.

His childhood days were spent underneath his father's drawing boards, playing with paper
and glue, taking anything to pieces and rebuilding it, usually in a different way. Remaking the
world around him.

After dropping out of school, he founded his design firm in 1968, initially specializing in inﬂat-
able objects. Then after a brief role as art director with Pierre Cardin, he moved on to inde-
pendent interior and product design. He started by redesigning two Parisian nightclubs, which
caught the eye of President Francois Mitterrand who asked him to refurbish the Elysée Palace.

Much of his early work was more akin to fashion and novelty, whereas he has now moved on
from throwaway artefacts to more serious design, and pieces of timeless value.

Clocks, vases, door handles, toothbrushes, watches, food, cutlery, lamps, lemon squeezers,
desks, motorcycles, taps, baths and toilets are all in his portfolio.

You can wake up to his alarm clock, use his Target toothbrush, wear his space-age Puma boots
and Fossil wristwatches, carry his Samsonite luggage, work with his Microsoft Mouse, dine at
Asia de Cuba restaurant, drink the stylish bottled beer from Kronenbourg 1664, and sleep in
his new classic hotel, The Paramount.

Starck champions creativity with purpose, art that is practical, and insight that is innovative.
His collaborations turn average products into practical and essential objects of desire, and can
easily triple the profit margins of the brands he works with.

At his drawing board he works with purpose and passion. He inspires us with his striking
reinterpretations of the world around us. He is subversive, intelligent and always interesting.

He thinks without boundary, rejecting our conventions and challenging our tolerance, creating
objects that are practical and beautiful.

Inspiration

Oregon USA, 1962: Phil Knight was selling running shoes out the back of a van at the local uni-
versity track meeting. The young business student had a passion for running, although he was
never the most talented in his team. He therefore pursued his other passion, making money.
He was creative too, importing Tiger running shoes from Japan, and became as well known for
his fast shoes as his own speed.

He trained hard all the same, seeking to get the best out of his talent, guided by the elderly
university coach Bill Bowerman. One day they were in Bill's kitchen making wafﬂes after a
hard morning training run. Phil took his shoes off, and by accident put one down on the hot
wafﬂe iron.

The smell of burning rubber caught everyone's attention.

It caught Bill and Phil's imagination, and soon they were making their own running shoes
with a unique wafﬂe-patterned sole. More traction, less weight, more speed. A few years later
they added a swoosh logo, created overnight by a young designer called Carolyn Davidson for
$35, and a sporting giant was born. The ﬂash of inspiration that created a marketing idea, and
business success.

Nike. The ancient Greek goddess of victory.

Phil grew the organization with attitude and passion. He turned his own athletic frustrations
to business, and with an accounting degree he created Nike as a company passionate about
sports and profits.

By 1979 he had gained 50% of the US running shoe market, at a time when the jogging boom
was taking off. He and Bowerman constantly innovated with wafﬂe soles and air cushioning.
Through the next two decades, largely through highly creative marketing - the advertising,
the endorsements, the 'just do it' cult - he turned Nike into the global brand leader, in every
sport, in every land. Nike's portfolio now extends to Converse sneakers, Hurley surfwear and
Cole Haan formalwear.

As an intuitive marketer he knew that the inspiration came from his customers - helping them
to achieve sporting excellence, as written on the inside of every pair of shoes. He also under-
stood that deep insight, strong branding, relentless innovation and strong relationships are
essential to achieve success in the short and long term.

One senior Nike executive described Knight's style as unusual but inspirational. Few managers
have ever entered his office at Beaverton, and those who have are always required to remove
their shoes first, even their Nikes. Even fewer journalists have managed to probe his enigma,
and those who have learnt little. Yet the mediocre miler, who always aspired to more than his
physical talent would allow, certainly has a knack for results.

When asked by his managers, for answers or advice on a diversity of business issues, execu-
tives would usually get the predictable and obscure guidance to 'run faster'. Just like his coach
Bill Bowerman, who replied similarly to Knight's own questions about how he could become a
better athlete. His managers turn away puzzled but often inspired.

'Run faster' has had a remarkable impact on Nike over the years.

More than four decades later, Phil recently decided to hang up his CEO running shoes, after suc-
cessfully developing a business from scratch to $12 billion, with a passion for marketing, as well
as sport, at its heart. He is a genuine marketer and business leader who combined his passion
with profits, creativity with commercialism, intelligence with imagination - as you can read in
Nike's unique annual reports - in the pursuit of personal, marketing and business excellence.

While Phil's best known marketing tag line 'Just Do It' is a sentiment that reﬂects his personal
approach to business success, he leaves with one of his other well-known taglines - 'there is
no finish line' - much in mind, because he and Nike know that their world is moving at a faster
pace than ever, and only by constantly accelerating their ideas and innovations, markets and
brands can they ensure leadership and success.

Knight is certainly a radically creative, visionary and empowering marketer, but also a disciplined accountant. He has been portrayed as mysterious, inscrutable, eccentric, unpredictable, enigmatic, idiosyncratic, shy, aloof, reclusive, competitive and a genius. He shuns publicity, although he is never far from his desk - or the gym - at Nike Campus. However, his passion continues in his products and his people, as well as making Nike one of the most profitable and respected companies in the world.

'Genius' is the one attribute on the list that Knight himself questions:

'Other than that, I'm all of those things, at least some of the time'.

However, surely a genius is far too intelligent to call himself such a thing.

intelligence and imagination

2009-06-04T19:00:00.000+03:00

There are ten characteristics of genius:

1- Original Thinking.
A genius starts with an open mind, uncluttered by conventions, taking
new perspectives, deconstructing a problem then reassembling it in better ways. Many
great ideas have been rejected because they don't fit with conventional thinking, and
they have been denounced as impractical or 'ahead of their time'. The Swiss watchmakers
provide one such example: they rejected the idea that timepieces could be built through
electronics rather than springs and gears; similar are the ﬂoppy disk manufacturers who
just couldn't see the disruptive coming of the CD-ROM, and more recently the USB pen.

2- Creative Thinking.
A genius is always open to possibility, seeking to solve problems by
hypothesis, taking a mental leap and then seeing whether it proves to be true or not. Einstein often used hypothesis to jump out of his mathematical derivations, to conjure a possibility that he could then seek to prove or disprove. Logical derivation will take you down certain avenues of thinking dependent on where you start. Constantly having the curiosity
and confidence to ask 'What if?' rather than seeking safety in what is close or known.

3- Analytical Thinking.
A genius will work through a problem or idea progressively and
rigorously, as well as creatively, challenging the mathematical or scientific logic. While a
genius reaches new levels or dimensions through creative leaps, there is still the need to
make sense of it in practical terms. Often this requires a pure mental logic as the current
mathematical formula or scientific principles might well themselves be based on some
false assumption. Breakthrough is rarely achieved by derivation of convention, but it does
require proof of the new concept.

4- Observational Thinking.
A genius has an exceptionally high state of consciousness, a
greater awareness of what is going on, and looking for patterns like a forensic detective.
Some of the best insights come from observation rather than enquiry, like an anthropolo-
gist watching and considering what is happening. In particular this is useful when there is
no current language or logic for explaining phenomena or behaviour. Alexander Fleming
found mold on his exposed medical cultures, just like many other doctors, yet instead of
just throwing it away, he considered what caused it, an observation curiosity that led to
penicillin.

5- Dual Thinking.
A genius can think in parallel, to tolerate apparent ambiguities, to bring
together opposites and connect the unconnected. New solutions are often contradictory,
either with conventions, or within itself, and indeed Scott Fitzgerald's definition of what
makes a first-rate mind is 'the ability to hold two opposing ideas at the same time'. Niels
Bohr, the Danish physicist, imagined how light could be thought of as both particles and
waves. This seemed entirely contradictory. Yet his discovery of phonons, intangible particles that behave like waves, led to his theory of complementarity. Similarly, Leonardo davinci combined the sound of a bell with the ripples when a stone hits water, to arrive at
the idea that sound travels in waves.

6- Holistic Thinking.
A genius can take a broader perspective, to see the holistic problem
in the context of its environment and piecing together its many parts. Einstein brought
together different strands of our natural world, uniting apparently diverse attributes such
as energy, mass and speed of light. Picasso's abstract work sought to represent much
more than a simple image. His works built personality, context, feelings and vision into
his observations. He seeks to provoke more holistic and deep thought, rather than simply
replicate what he sees. Indeed the ability to see the bigger picture, or to fill in the spaces,
can often mean that a genius 'sees what everybody else can see, but thinks what nobody
has thought'.

7- Volume Thinking.
A genius searches for many solutions rather than just one, building on
or challenging each other, constantly searching for a more perfect solution. A genius has
a constantly active and fertile mind, the sheer quantity of their output can be intimidating, which is why it sometimes takes some years to identify the best from the also ran.
Mozart wrote 600 pieces of music and Bach wrote one every week even when sick. Einstein
published 148 papers, although he is best known for one of his earliest. The enormous
work rate of Picasso in his final years was initially denounced as the senility of an old man
trying to maximize his legacy; however, many years later we actually recognize this most
productive period as also the most creative.

8- Pragmatic Thinking.
A genius recognizes that ideas and solutions are of little use in the
abstract, that the theory or concept must be made real, that it must be practical and
useful. A genius is constantly thinking, exploring, inventing and discovering. However,
genius is only genius if it can be put to practical action, can add value in some way. Edison
held 1093 patents, more than anyone else to this day, and demanded of himself one minor
invention every 10 days, and a major one every 6 months. Similarly, most successful entrepreneurs will have many failures behind them before they succeed and most innovators
will develop far more new ideas than see commercial success.

9- Visual Thinking.
A genius is able to express their ideas more clearly, typically visually through diagrams and analogy, to make sense of complexity in comprehensible ways. The creative explosion of the Renaissance was marked by a multitude of drawings and diagrams, as Galileo and Leonardo da Vinci graphically illustrated their revolutionary ideas.
These captured people's imagination far more than words or numbers. Pictures enable connections to be made more quickly, concepts to be demonstrated far more easily, and the holistic system to be explained.

10- Conviction Thinking.
A genius must have the inner strength, belief and confidence to stay strong to what they believe, while conventions and colleagues will challenge them. From Galileo and Leonardo, to Einstein and Picasso, genius requires an inner strength of conviction to stand by the radical ideas and actions that are at odds with received wisdom, that challenge the status quo, that could easily be compromised by a lesser-willed person. In any walk of life, it is rare for people immediately to like significant change in their surroundings, practices or beliefs. We prefer the safety and convenience of what we know than what we don't. But we gradually see the possibility, the logic, and the benefit in different thinking, and we accept it, and eventually engage in it. A genius must often reach out beyond today, and slowly people will follow and embrace what is new, different and better.

Concept

Genius is about applying intelligence in more imaginative ways.
There are many definitions of genius. While some focus on the intelligence aspects of genius,for example the attainment of a high IQ, genius is typically defined, as being less about the
absolute level of intelligence and more about the application of intelligence in creative ways.
While some suggest that one is born with genius, or with the aptitude to achieve it, most argue

that genius is primarily achieved through carefully chosen hard work that blends deeper think-
ing with radical creativity.

Genius uniquely combines these extremes to deliver extraordinary results.

gen/ius
noun pl geniuses

Exceptional intellectual or creative power or other natural ability.
An exceptionally intelligent or able person.
(pl genii/jeeni-i/) (in some mythologies) A spirit associated with a person, place or
institution.
The prevalent character or spirit of a nation, period, etc.

Source: Oxford English Dictionary

The combination of intelligence and imagination is the source of this extraordinary impact, and
one that is essential to marketing today.

For years marketing was overly concerned with the creative aspects of business, the source of
ideas and expression that made commodities distinctive and relevant. Indeed, in most com-
munications agencies and internal teams, creativity is still king. The power of the image or
strapline matters most. Other marketers have become far more analytical - ask most today, and
they will argue that they need to be even more rigorous and commercial.

Yet too many marketers see this as an either/or situation: that you can be heads-up creative
or heads-down analytical, that being commercial is about finance rather than innovation, and
that within agencies you are either a 'creative' or a 'planner'. This misses the point of genius.
Analysis and creativity should not be seen as separate disciplines, as alternative approaches,
or as compromising each other.

The source of genius is the positive combination of intelligence and imagination.
The elements of genius can be reﬂected in left-brain versus right-brain theory. While the brain
is in reality far more complex than this, the theory reﬂects an understanding of extreme oppo-
sites and how to balance and combine them in a way that achieves positive reinforcement. The
left side of the brain is associated with the gathering of data, analysis and evaluation. The right
side is more to do with making, creativity, synthesis and exploration.
Genius and its combination of extreme opposites could also be reﬂected in the more tradi-
tional yin-yang model, where left-brain is similar to 'yang' characteristics and right-brain is
analogous to 'yin' features.
In both approaches, the opposites are not alternatives. Success requires both sides. One rein-
forces the other. In education, it is recognized that the pursuit of a creative subject, such as
music or art, adds to the individual's analytical capability, to appreciate the patterns within
science or mathematics, and vice versa.

In marketing , we consider the implications of reconciling these opposites for each aspect of
marketing - from market analysis to strategy formulation, brand development to innovation,
value propositions to distribution channels, media integration to investor relations, marketing
metrics to marketing leadership.

In Marketing Genius we explore how more stretching thought and actions can be brought
together and applied to the key challenges of marketing today, and the many aspects that make
up an integrated approach to markets in order to significantly improve customer, competitive
and financial impact.

In 'Genius Lab', at the end of this book, we describe in more structured terms the attributes of
genius and how they can be applied to marketing at the activity level, and to the attributes
of the individual marketer. The diagnostic models apply the genius model to the challenges of
marketing and business today, and illustrate how the marketer can practically embrace new
approaches to each success.

Genius marketing is more intelligent and more imaginative - stretching both extremes and
combining them in more powerful, reinforcing ways in order to deliver extraordinary results.

Genius marketing connects extremes
to enhance value and deliver
extraordinary results
1 + 1 = 3

Application GENIUS PROFILE

How close are you to genius? Are you more left or right brain in your natural way of work-
ing? Does your current work force or encourage you to work in a different way to your
natural style? Which is better? How do you develop your or your team's marketing to be
more balanced and effective? Which kinds of people would you work best with, to build
the most complementary team?
1. Left and right brain

Consider the relative attributes
of left vs. right brain thinking, as one
model of different thinking patterns.

2. How you solve problems

Imagine you are addressing an
important business issue, how you
address and seek to solve a problem.

3. Profile yourself at work

Choose your preference for each
paired attribute, and profile yourself
towards the left or right side on each.

4. Profile yourself at home

Repeat the profiling for out-of-work
decisions you make, e.g. buying a car,
your next holiday, a new job.

5. Do you behave differently?

Reflect on how your work and non-work
decision-making differs, and which is
your more natural and balanced style.

6. How will you think differently?

How well do you balance and combine
left and right brain thinking? How might
you think differently in future?

concept

Genius marketers must sense and respond to the complex challenges of today's markets with
deeper intelligence and more radical imagination, to think more strategically and commercially, to implement with more focus and effectiveness. Intelligence and imagination can positively combine for more impact in competitive markets, as well as on the bottom line

intelligence and imagination

2009-06-03T17:00:00.000+03:00

Marketing with more intelligence and imagination.

Marketing matters more than ever today, yet not as it is. Marketing must be more intelligent
to make sense of the complexity, and more imaginative to stand out from the crowd, to drive
business outside in, as well as inside out, to do business on customer terms and grow profit-
ably, to create more value for customers and shareholders, by delivering today and creating
tomorrow at the same time.

A genius applies intelligence in an imaginative way.

More imaginative

Ideas. Sensing and responding to market opportunities, deep customer insight, and
intense competition.

Creative. Exploring new possibilities,visionary and innovative, intuitive and
challenging, connecting the best ideas.

Picasso. Capturing the artistic passion and abstract structures that challenged
convention and explored possibility.

Marketing has always been a creative discipline, yet it is surprisingly conventional in its execution. The product and packaging might be tweaked, and the advertising may tell a new story, but it is incredibly lacking in real innovative solutions to people's problems, innovative ways to reach them, innovative use of media to connect with them, innovative ways of making money from them. Marketing needs to find its creative spirit, applied in a focused and disciplined
way.

A genius will find that creativity enhances analysis, and intelligence unlocks greater imagination.

Einstein struggled for years to make sense of the many complexities and contradictions of
classical physics and the real world. The sheer complexity of what he was seeking to explain
was mind-boggling. And for a long time, it was to him too. However, through creativity he
eventually saw the light, standing back and reﬂecting on the patterns and symmetries, using
hypotheses and deduction, he realized that the relationship between energy and matter was

actually very simple, that E is equal to MC 2. And we all marveled through the complexity, at
the simplicity of the solution.

A genius creatively unleashes the power of intelligence.

We live in a world - at least in a Western world - where we generally have everything that we
need. Wardrobes are full of clothes, kitchens are brimming with utensils, and garden sheds are
crammed with everything we don't want inside the house. Yet we still want more. The newest,
the coolest, the best. A basic human need, like hunger or shelter, which we constantly seek to
satisfy in new ways. So how do marketers connect with this thirst for more?

Seeing what everyone has seen.

Thinking what nobody has thought.

Everyone in every sector is seeking to find ways to add value beyond the product and service.
Shop here because it is where you meet people. Stay at our hotel because we'll take you to the
theatre too. Buy a computer from us, and we'll help you to become an entrepreneur.

Enriching the value proposition

Extending the brand experience

Enhancing the customer benefits

Money matters less too. If you can do something which really matters then a basic item can
become a luxury item. Bottled water: from thirst quencher costing a few cents a litre to fashion
accessory costing $3 a bottle. The perceived value is fundamentally changed, as is the peer
group against which value is judged, and the relationship through which it is sustained. Ideas
keep markets moving, and money ﬂowing.

So what is the role of genius in marketing today?

Genius is about combining discipline and creativity to unleash innovation where it matters
most. To create difference and engage people in a world where it often seems that all the best
ideas have already been taken. Ideas for new solutions, ideas to exploit existing markets better,
ideas to do it more effectively, ideas to compel the customer to you. Big ideas define and sustain
your brand, but they need constant refreshment to stay relevant and compelling. Ideas are the
source of value creation. Ideas are the basis of newness. Ideas make marketing matter, and
make it the most exhilarating part of business to work in too.

Psychologists rage over whether a genius is born or can be made. Russian scientists have pur-
sued the idea of a genius gene, which could be identified and nurtured. Others believe that the
biggest inﬂuence on intelligence is the environmental stimulus a baby receives within their
first year of life. Thomas Edison argued that genius was far more about hard work at any age
- 1% inspiration and 99% perspiration.

Like the champion athlete, genius must require some talent. However, like those athletes who
have gone on to win gold medals, and compared with the many others who have ended up by
the wayside, that talent must be nurtured and directed, stimulated and stretched. Marketing
genius is the same, evolving out of experiences of the workplace and the marketplace.

The stimulus for marketing genius comes from outside - from customer insight and competi-
tive action. It comes tangentially, for example from other markets - if you were a bank, what
could you learn from consumer goods, or if you were a sports shoe manufacturer, what could
you learn from mobile phones? Indeed, genius is stimulated anywhere - by a documentary on
Discovery channel, by an unusual experience while traveling on holiday, by a random comment
that meant far more than it was meant to The demand from a CEO for 10% growth is likely to be greeted with a conventional response
- more perspiration. The challenge from a CEO to make the impossible possible is more likely
to stimulate a deeper and more inspired response.

The desire for higher performance, to do a better job comes from within, a passion to do better
and be different. Inspiration. The talent for marketing genius comes from within - from the mar-
keter who wants to be better and different from others, and to deliver extraordinary results.

Concept 3
How does a genius think?

What is common about the thinking styles that produced the Sistine Chapel and the Theory of
Relativity, penicillin and the World Wide Web?

Academics and philosophers have long tried to bottle genius. Russian scientists, through the
analysis of child prodigies, claim to have identified the 'genius gene', while others argue that
it is largely down to hard work - as Thomas Edison said: 'Genius is 1% inspiration and 99%
perspiration'.

However, there are some clues as to what drives genius, and its extraordinary results. First,
genius is widely accepted not to equate purely to intelligence. It is certainly not necessary to
have an extraordinarily high IQ, to speak 15 languages by the age of eight, or to master the
intricacies of quantum mechanics. It is, however, recognized that genius typically involves
both intelligent and creative thought, and the combination of the two, in any combination,
can create so-called genius.

Creating tomorrow (growth Profitable 2)

2009-06-02T21:00:00.000+03:00

John Sunderland, the former CEO of Cadbury Schweppes, knew what he was talking about
when he took up his position in 1997 and announced: 'Within four years I will double the value
of this business Economic profit will be our key measure of success, and building strong
brands will be at the heart of achieving this.'

So if your CEO sets out an ambition like this, as a marketer what should you do differently?

Where and how to compete a value-based market strategy will look very different from
a conventional one, identifying which existing and emerging areas of the market offer the
best long-term return on equity.

What to focus your effort on a value-based portfolio analysis will identify which prod-
ucts are the value creators, and which are the value-destroyers and therefore where to
focus effort. Taking into account the cost of equity creates a very different picture than a
typical Boston Grid. A similar analysis will identify the best customers.

How to capture the value you create a value-based proposition rightly focuses on
creating value for customers, addressing customers' real needs and outperforming the
competition. It is equally about finding ways to capture as much of this value as possible
for shareholders, by maximizing the perceived value and optimizing pricing while still
offering 'value for money'.

How to get a better return on spend a value-based marketing programme identifies the
marketing actions that will generate best returns, this year and long term. It identifies
which levers to pull (e.g. sales promotion, advertising, PR) and how most effectively to lev-
erage your marketing assets (e.g. brands, customer knowledge and distribution networks).

Value-based marketing is often dismissed as sophisticated analysis or complex performance
metrics. It is much more. It is fundamentally about decision-making - choice of markets and
positionings, choice of products and customers, choice of offering and price, choice of activities and investment.

Most conventional data analysis is driven by the need to create a broad range of proxy meas-
ures because there appears to be no 'best measure', or marketers are so unsure about their
criteria for their decision-making that they take comfort from thick reports. So does a value-
based approach to marketing create more analysis and inhibit creativity? Quite the opposite.
Great news for marketers

The great thing about value-based marketing is that it focuses on the numbers that really
matter, and the right basis for effective decision-making. Invest once in the process to generate the right data, then you have less data, quicker to generate, with a much clearer focus
and therefore much clearer scope to focus innovation, and much more time to do it creatively.
And the CEO will like it too. What board will argue with a new marketing proposal that creates
significantly more value for shareholders?

At Cadbury Schweppes, four years later, John Sunderland's value-based marketing approach
focused on creating exceptional value for customers by investing in leading brands, and on
market and product innovation. With stretching performance targets, clear marketing priori-
ties and billion-dollar acquisitions such as Snapple, he just about achieved his targets, which
in many ways was thanks to the priority he placed on brand development and marketing.
Application 2.3 VALUE DRIVERS Application 2.3 VALUE DRIVERS

What are the drivers of business success or, more specifically, the drivers of shareholder
value? How is improvement profitability, relative to growth and risk? How does the
nature of capital investment affect this profitability? How inﬂuential is price relative to
operating costs and volumes in driving profits? How important is customer satisfaction
compared with preference, retention or loyalty in driving sales? And which aspects of the
product, service or whole brand experience are most important to customers in driving
this?

1. What matters to customers

Identify the attributes that are important
to customers through qualitative then
quantitative research.

2. Customer drivers

Evaluate what most drives
customer attitudes, behaviors,
affinities and purchase decisions.

3. Operational drivers

Evaluate how these customer drivers
effect operational performance,
e.g. sales, awareness, share, costs.

4. Financial drivers

Connect these operational metrics
through to financials, and link
operating profit to economic profit.

5. Prioritization for value creation

Weight each of these financial drivers
by relative impact on long-term value
creation (e.g. margin v growth v risk).

6. What matters to business

Flow back through connections to
re-weight customer attributes and
relative priority of marketing activities

Creating tomorrow (growth Profitable)

2009-06-01T22:00:00.000+03:00

growth Profitable growth

Sustained, profitable growth is the foundation of value creation.

Marketing drives a sustainable cycle of profitability. Managed over time it creates profitable
organic growth. Inorganic alternatives, such as mergers and acquisitions, are fraught with
problems. It is hard to sustain an incremental benefit beyond the initial fusion of companies.

Many marketers might dismiss the whole notion of creating value for shareholders, not only as
greedy owners in pursuit of a quick buck, but also without a care for customers. This assumes
a rather clumsy reallocation of value - reducing the value of customer propositions and giving
more back to investors.

Sure, there are some blinkered companies that will do this, but they are in the minority: 97%
of CEOs say their number one priority is to create long-term shareholder value. Indeed, they
have a legal responsibility to do so. Long term typically means over 5 years and often more.
They are not after a quick buck.

Customer Value

The only sustainable route to shareholder value is to create exceptional value for customers,
requiring a disciplined and virtuous circle of customer and shareholder value creation. Market-
ing is about creating exceptional value for customers and shareholders.

The only way to sustain value growth is to create a virtuous circle of doing more for customers
and shareholders. Investing in creating superior value for customers - through innovative new
products and services, as well as enhancing the proposition which describes them - creates
differentiation, purchase and affinity. Customers pay more, and those margins should be effi-
ciently translated into dividends and share growth. Further investment in brands and relation-
ships drives loyalty and repurchase.
Customer value, the value to the customer as perceived by them, is harder to quantify. However,
perceived value is not only a function of benefits and costs, but also of the context in which
customers choose to place them. Context might mean the competitors sitting alongside on the
supermarket shelf, or a change of occasion.

Consider sister companies within VAG, Audi and Volkswagen. The Audi A4 and the VW Passat
are essentially the same car, with the same manufacturing base, different mouldings, unique
badges, and the same cost base. Yet Audi markets itself as a peer of BMW 3 series, while the VW
model is more analogous to a Ford. In the UK, the result is a £3000 price premium for Audi.

Consider Smirnoff. Smirnoff is bought in large bottles, pure alcohol. Smirnoff Ice is bought in
much smaller bottles, with about one-fiftieth the alcoholic content, but with largely the same
price. The Smirnoff Ice drinker is standing at the bar looking cool and sociable. Insensitive to
price, far more sensitive to what the label says about him or her. Same basic product but two
very different propositions, and profit levels.
Inspiration 2.3 COCA-COLACOCA-COLA In piration 2.3

'The Coca-Cola Company exists to benefit and refresh everyone it touches.'

The basic proposition is simple, solid and timeless.

'When we bring refreshment, value, joy and fun to our stakeholders then we success-
fully nurture and protect our brands, particularly Coca-Cola. That is the key to fulfilling
our ultimate obligation to provide consistently attractive returns to the owners of our
business.'

Coca-Cola was created in Atlanta, Georgia, by local pharmacist Dr John S. Pemberton, who
produced the cola syrup and took it down the street to Jacob's Pharmacy and sold it for five
cents a glass as a soda fountain drink. He pronounced it 'delicious and refreshing', language
that has stuck.

The name 'Coca-Cola' and its unique script were proposed by his friend, the local bookseller
Frank Robinson, which he agreed that with its two Cs would look good on advertising bill-
boards. It was registered as a trademark in 1887; by 1895 it was available in every US state,
and by 1899 it had established its bottling franchise operations.

Coca-Cola's marketing chronology reads like a history of marketing, from the early oil cloths
hung outside the pharmacy with the red and white logo, through the creation of the modern
red and white image of Santa Claus, to the famous ad featuring 'I'd Like to Buy the World a
Coke', sung on a hilltop in Italy by young people from all over the world.

'I'd like to buy the world a home
And furnish it with love
Grow apple trees and honey bees
And snow-white turtle-doves
I'd like to teach the world to sing
In perfect harmony
I'd like to buy the world a Coke
And keep it company
That's the real thing.'

Source: cocacola.com

The company now offers a portfolio of over 400 different drinks, bringing significant challenges
in knowing where to focus its efforts. Which markets are the most attractive now and in the
future? Which products should it invest in most?

Coca-Cola approaches this challenge in two steps: first, by understanding the global drinks
market in terms of growth and profitability. This indicates that most of the current industry
- and Coke - profits come from carbonated soft drinks, yet there is little growth in the market.
Sports drinks, meanwhile, show a very high growth and present a highly profitable opportunity.
Water too is high growth, but with much lower margins.

Bulk water Sports drinks Retail water

The second step for Coke is to understand how these opportunities fit with its own business, its
capabilities and product portfolio, brand positioning and desired strategy. It can then prioritize
its strategic market objectives based on the best fit in the most attractive markets. This market
focus then drives the business strategy, which in its case includes the need to build new capa-
bilities and accelerate its entry into fruit drinks, sports drinks and ready-to-drink teas.

Application

Why does the sum of shares, i.e. the market value, equal significantly more than the value
shown on my balance sheet? Is the market value, the future worth of my business as
judged by investors, good or bad? Is it more or less than what we think is the worth of the
likely future streams of profits? Why are they different, and what should we do?

1. Understand economic profit

Understand the current economic
profitability of business, i.e. the operating
profit less the cost of capital.

2. Project future growth

Project likely market growth trends
and strategic plans, and how they will
Influence profits in future years.

3. Project future profits

Evaluate potential profits over next
five years and a perpetuity figure to
reflect how this would continue.

4. Calculate the intrinsic value

Calculate the net present value of
these future profits, using a discount
rate to reflect the appropriate risk.

5. Compare with the market value

Check the market value based on
share price multiplied by shares, i.e.
reflecting the perception of investors.

6. Address the value gap

If the intrinsic and market values differ,
suggesting an over/under valuation,
consider why and what action to take.

Concept 2.3 VALUE-BASED MARKETING Concept 2.3 VALUE-BASED MARKETING

Marketers must create the future while also delivering today, balancing the tangible with the
intangible to demonstrate how the company's biggest discretionary spend, the marketing
budget, can be deployed for maximum impact.

At least two-thirds of all marketing is typically about the future, rather than today; that is, of
the investment in marketing this year, around 60-70% will drive transactions in future years,
rather than this year. This might come as a surprise to many finance and business leaders
who expect to be able to match the vast majority of marketing costs against the same year's
revenues.

However, the majority of strategy, innovation and communication will have more impact on
the profits of future years than this year. That's good, as it's exactly what the shareholders
are most interested in; however, it can sometimes seem far off to the CEO with the quarterly
results to publish.

Marketing must therefore deliver today while creating tomorrow. Sales promotion, distribution
and pricing tactics can all drive short-term sales and profits. However, the real trick is to do
this in a way that also supports the future. Advertising, for example, may have an explicit sales
message ('25% off garden furniture now') in order to prompt immediate purchase, or it may
be about 'teaching the world to sing' which is a long-term brand-building effort, changing
perceptions and building affinity.

In economic terms, marketing can typically create three times more value for a business than
anything else it can do. It achieves this by improving profit margins, accelerating future cash
ﬂows, and reducing the uncertainty of them.

The real value of marketing is attained by optimizing this short- and long-term impact.

The measure of good marketing - which markets to focus on, how much to invest where, which
products to develop or eliminate, how effective brand building is over time, how to optimize
marketing activities, how to justify the large expenditures on the likes of advertising - is
'value'; not sales or satisfaction, share or profit, but the long-term return to shareholders, and
all that that requires.

Shareholder value gives the organization a focal point through which everything else can be
linked and prioritized. It provides a logical and holistic approach by which to develop strategy,
make decisions, focus effort and measure performance.

'Value drivers' enable us to connect this rather abstract goal with practical activities and day-
to-day decision-making, identifying and quantifying the relative importance of every action
and output. A value driver analysis is typically portrayed as a horizontal 'tree diagram' showing
how market-based actions lead to financial consequences.

Market drivers

Customer drivers

Organization drivers

Financial drivers

The analysis is not obvious, and while it looks intuitively simple, understanding the connections
and relative importance is a significant piece of work. It will differ somewhat for every organi-
zation, given that every business has a different make-up of assets and activities, although it
may be similar by sector.

It is important to start from the end-point and work backwards, as the market drivers of some
other financial objective will be different. An analysis of 'operating profit' drivers, or 'revenue'
drivers would lead the organization to very different conclusions as to where to focus their
efforts.

Connecting all the activities of the business can lead to surprising insights. Many organizations
believe in the fundamental importance of customer satisfaction and, while a customer orien-
tation might certainly be important, the pursuit of 'satisfaction' scores in themselves may do
little for business performance. Whereas focusing effort on encouraging retention or referral
can sometimes be much more significant. Of course, these value drivers will be different for
every market, category and business.

Within marketing, some of the main applications of this value-based thinking are:

Demonstrating the financial return on marketing.

Connecting customer priorities to financial drivers.

Justifying advertising spend with multi-year paybacks.

Balancing short-term versus long-term objectives.

Optimizing marketing resources and budgets.

Focusing investment in the right places.

Prioritizing activities across the customer experience.

Understanding the relative importance of price.

Clarifying which goals matter most in measuring performance

Creating tomorrow (MS)

2009-05-31T22:00:00.001+03:00

Microsoft was famously founded in Albuquerque, New Mexico, in 1975 by Bill Gates and Paul
Allen. Today Microsoft sells a huge range of software products, many developed internally, and
others rebranded following acquisition.

The business is organized into seven core units, each with its own financial reporting to del-
egate responsibility and more closely track the performance of each unit, to allay regulator
fears of cross-subsidies, and probably to make survival easier if the courts ever did demand a
break-up of the monolith. The business units, according to its website, are:

Windows Client (managing the Windows client, server, and embedded operating sys-
tems).

Information Worker (managing the office software products).

Microsoft Business Solutions (managing the business services and process applications).

Server and Tools (managing developer tools and integrated server software).

Mobile and Embedded Devices (managing palmtop and phone devices).

MSN (managing web-based services).

Home and Entertainment (managing consumer hardware and software).

Microsoft openly describes its culture as 'developer-centric', even though its businesses seek
to align themselves to markets rather than technologies, encouraging development against
customer need rather than technical possibility.

A great deal of time and money is spent each year on recruiting the very best university-trained
software developers and on keeping them in the company. Key decision-makers at every level

are either developers or former developers. Indeed, the software developers at Microsoft are
the 'stars' of the company in the same way that sales staff at IBM are considered the top dogs.
This culture is reﬂected in its recruitment process which is famed for its off-the-wall questions
such as 'Why is a manhole cover round?'

At a more strategic level, Microsoft is working to replicate its success on the desktop in new
markets such as media players, server software, handheld devices, car navigation, web services,
video games and, more recently, search engines, with varying degrees of success. Remembering
Gates's early vision of 'to be in every home and office', it is now trying to establish PCs running
Windows XP Media Center Edition as home entertainment hubs.

The business model is also under review; for example, moving to more of a subscription model
for licensed software, rather than relying on users to buy upgrade packages every few years.

Amidst concerns from investors that it will no longer be able to sustain the historical growth
rates, Microsoft announced in July 2004 its intention to implement a $30 billion stock repur-
chase plan over the next 4 years. It also announced a special one-time dividend in December
2004 that would pay Microsoft stockholders $32 billion, by far the largest payout by any
company in history.

As customers, we sometimes grumble about being forced to pay high prices for ever-chang-
ing versions of products that frequently go wrong. And, of course, seeing the huge returns to
shareholders probably frustrates some people even more. The reality though is that Microsoft
has shaped its market in its own vision, while as customers we keep buying the products, and
rely on them in our working lives.

Microsoft has its critics, but it is also a great marketing success.

Concept 2.1 VALUE CREATION Concept 2.1 VALUE CREATION

Many organizations are confused about why they exist, and indeed there are a wide variety of
reasons for organizations to exist. At the simplest level it comes down to stakeholders. These
are the different groups of people who have by definition 'a stake' in the business - in some way
they contribute value to the business, in the expectation that they will get a return, a 'value
exchange' if you like. They include employees, customers, suppliers, partners, shareholders,
governments and society.

A public-listed company is owned by its shareholders, those who invest capital in the business
for a financial return. Yet even in these companies, where the primary measure of success is
the return on these investments, the business still exists for a higher purpose and, indeed,
that is what engages employees to come to work each day, customers to grow loyal, partners
to want to collaborate. The business can only succeed in delivering - and, most importantly,
sustaining - a return to shareholders if it creates a model where each other stakeholder group
can succeed too.

The pursuit of long-term 'shareholder value' can only be achieved by also creating value for
customers, for employees and others in a virtuous circle of investments and returns. Imagine
a pie chart cut by the value created for each stakeholder. There are two ways in which share-
holders can gain more:

'Value greed' - shareholders get more value at the expense of others, who will eventually
leave or defect if they feel they don't get sufficient back for what they give.

'Value growth' - shareholders get more, and so do all others stakeholders in similar pro-
portions as before; value is created rather than redistributed

We term this total value the 'economic value' of the business, and it is reasonable that every
type of business should seek to maximize its economic value as a primary goal.
Long-term shareholder value creation should be the primary measure of success of a publicly
listed company as that is why it legally exists, while recognizing that it cannot be achieved
without the other stakeholders. Short-term shareholder 'greed', or indeed that of senior execu-
tives if their remuneration is only linked to short-term performance, is not sustainable (as we
saw with the behaviours that it led to at WorldCom and Enron).

Sustained value creation is only achievable through growth, not greed, making a bigger cake
rather than just recutting it.

Other types of organization have a different order of priorities. A charity typically exists to
support the public, or at least a large section of it, and championing a particular cause, be
educational or health, religious or environmental. This type of organization still has many
stakeholders, and indeed it should be commercially managed, but rather than offering a direct
return to those who donate to it, it needs to ensure that the maximum possible funds can be
delivered to the society it champions.

There are many other types of organization within this spectrum too.

Indeed, even the most financially oriented companies need a 'cause' beyond money. Without
a sense of more meaningful purpose the company would lack the direction, difference or
engagement to achieve its goals. Mission statements that 'seek to maximize shareholder value'
will fail. Mission statements that seek to maximize shareholder value 'by creating the best x',
or 'helping people to do y', have the makings of a clear strategy, a strong brand and a common
objective which can bring people together and endure over time.

Recognizing that a business is a value exchange - a dynamic system of many different stake-
holders, each giving and seeking value, where the objective is to increase value for all - opens
up many doors previously closed to the blinkered financial orientation.
Inspiration 2.2 TO OTA In piration 2.2 TOYOTA

Toyota is Japan's leading carmaker, with a portfolio of brands in order to reach different mar-
kets. It has a small-sized car division, selling under the Daihatsu brand, as well as a heavy
vehicle division, selling under the Hino brand.

Meanwhile, the Lexus brand is used for luxury cars, the name derived from 'luxury' and 'ele-
gance'. Lexus dealers are known to have quality customer service, creating a customer-intimate
culture separate from the more operational-excellence focus of the main group.

In numbers, the business employs over 250,000 people, selling around 7 billion cars every year
in 150 countries. While behind the big three - GM, Ford and DaimlerChrysler - in volume, its
market capitalization is bigger than all three of theirs combined, reminding us that size and
market share are not always the route to success for shareholders.

Toyota started life in 1937 as a spin-off from Toyoda Automatic Loom Works, one of the world's
leading manufacturers of weaving machinery and headed by Japan's most revered inventor,
Sakichi Toyoda, whose son Kiichiro was given the challenge of creating the successful company
that we see today.

Key to Toyota's success is its relationships with employees and customers. Lacking the scale
and capital resources of the others, Toyota looked inside to find its advantage - focusing on
improving value for customers through deeper insights, continuous improvement and more
creative thinking made possible by highly engaged employees.

'I have learned, based on my experience, that everything is dominated by the market.
So whenever we are struck by obstacles or difficulties, I always say to myself: "Listen
to the market, listen to the voice of the customer". That's the fundamental essence of
marketing. Always, we have to come back to the market, back to the customer. That is
the Toyota way.'

Yoshio Ishiazaka, Executive Vice-President Toyota Motor Corporation

Its 'lean thinking' approach is less about operational efficiency and more about having a clear
and unﬂinching philosophy to serve and add value to customers. This focuses on customer
rather than shareholder value as the immediate objective, working through every aspect of the
business to focus ruthlessly only on what adds value to customers, and eliminating anything
that doesn't. This creates more ﬂow in the organization and encourages more thoughtful prob-
lem solving, as well as improving the customer experience and business performance.

To achieve this, it also recognizes that people need more time, often unstructured, in order to
solve real problems, think more innovatively and build new collaborations. 'HumanSigma' is part
of the approach, measuring and managing the human difference in a company's performance
Application 2.1 CREATING VALUE Application 2.1 CREATING VALUE

What is the economic value of your business? How do you convert the future potential of
your business into financial terms? How in principle should you distribute this value over
time? How do you manage to ensure that you achieve this potential?

1. Consider your future business

Consider the drivers of your future
profitability - including growth trends,
potential margins and risk/uncertainty.

2. Project future profits

Project the most likely profits in each
of the next years, based on trends
and potential scenarios.

3. Calculate their value

Sum these profits, discounting them
relative to the increasing level of
uncertainty, and add a perpetuity.

4. Allocate value

Consider how you would allocate this
total value between your stakeholders,
e.g. customers, shareholders over time.

5. Prioritize activities

Build this into your business strategy
and financial plan, and use it to help
prioritize resources and investments.

6. Manage for value creation

Manage the business over time for
value creation, focusing on economic
profit and best long-term opportunities.
If we accept that the only real measure of business success is the long-term return to share-
holders, then 'value' is what matters. Value is the sum of likely future profits. Revenues and
profits are not enough; indeed, selling more can destroy more value than it creates if the result
does not exceed the minimum expectations of investors. The reality of the commercial world
is that a business exists to create value for its shareholders.

Economic value is about getting more out than you put in. If shareholders invest their money in
a business then they seek a return on that investment. In fact, they seek a return that is greater
than they could get by alternatively putting their money in their bank's best savings account
or low risk investment plan.

The money shareholders put into a business - we call it 'equity' - gives us the opportunity to
invest, to buy equipment, to develop ideas, to take them to market.

The return they expect needs to exceed what they could get elsewhere, plus a bit more to reﬂect
the greater risk involved in a business than a bank account. We call this minimum 'hurdle' the
cost of equity.

Shareholders only start to realize 'value' when they get more out of it than they need to make
it worthwhile, i.e. when this hurdle is exceeded. This is the 'economic profit', rather than the
operating profit, in any given year. 'Economic value' is the sum of these economic profits likely
in future years. Inevitably, as we project further into the future, the certainty reduces and the
profits are discounted to reﬂect this.

Shareholders buy shares - the demand for which is reﬂected in the share price and the total
of which reﬂects the market capitalization, or the market value of the company at any given
moment.

However, most shareholders are in it for the longer term, rather than buying and selling as the
price ﬂuctuates on a daily basis. Businesses take time to create real enduring value, and these
committed shareholders receive their return in two ways - through dividends and growth in
the price of their shares.

The total shareholder return (TSR) is typically measured over five, sometimes even ten, years.
The really successful companies are not those that have the highest market capitalization at
any moment - the GE and Microsoft brigade - but those that have delivered the best returns
over time - companies like Quest Diagnostics and Ryanair.

Creating tomorrow

2009-05-30T20:00:00.000+03:00

Creating tomorrow while delivering today.

today and tomorrow. It creates the future and delivers today, driving sales and delivery of the
customer experiences, while also developing the new markets and products, and builds the
brands and relationships to ensure success in them. It also typically delivers a better return on
investment than any other part of business.

Creating tomorrow

Long-term. Pressure is on to drive future
results, through strategy and innovation,
strong brands and relationships.

Value. Economic value is the sum of
future profits, rather than today's, driven by
profitable growth and risk.

Outside in. Creating more value for the best
customers is the only sustainable route to
long-term shareholder value.

It is time for marketers to move from the fringes to the centre of decision-making, harnessing
the momentum of market change, and the authority of the customer, to shape strategies and
business priorities from the outside in, rather than inside out.

Business has been led for too long from the inside out. Accountants and operational managers
have sought to improve what has always been done, rather than respond to and exploit the
best opportunities in the market. The danger, of course, with incrementalism is that it can lead
to irrelevance, rather than addressing the real opportunities of markets.

However, marketers must change if they want to take centre stage, and indeed if they want
to survive.
The biggest opportunities in business today lie not in improving the efficiency of what you
have already done, but by embracing change in the outside world. This is primarily a marketing
challenge.

Businesses need marketers now more than ever.

Marketers must form the response to this change: to see the new game either being played
or emerging, break out of the conventions that were designed for a previous century, exceed
expectations on the high street and stock markets, and create exceptional value for customers
and for shareholders, and in new ways.

Today the expectations are incredibly high on all sides:

Customers want more than a product or service. They used to tolerate stock-outs and be
happy to come back again next week, or delivery times in weeks and months, and accept
that in a mainstream store there would be no negotiation, and they would expect to pay
the full price. Their experiences of Amazon to WalMart have changed that. They now
expect the best quality products, confidence that their expectations will always be met,
personalized solutions to meet their wider needs, same-day delivery, and lowest prices.

Employees want more than a job that pays a salary. They used to tolerate menial tasks, in
a sterile environment, where their role would not change over time, and as long as they
got paid they did not care about the wider organization or its customers and shareholders.
They now expect a more fulfilling role, a better environment and benefits beyond payment,
they expect to learn and progress, care passionately about their customers; they want to
inﬂuence their organization, and be proud of it.

Shareholders want more than a return on investment. They used to tolerate ups and downs
in share prices, lack of short-term profits in order to invest in future, no dividend payments
some years, annual updates at the AGM. Their experiences of dot com and hedge funds
have changed that. They expect regular and transparent information, more inﬂuence and
power, constant growth in quarterly profits, regular dividends and the best returns across
sector, not just among peers.

Stakeholders, more broadly, have gone from being of minor importance, through important
from the perspective of compliance, to being partners in creating superior value for sharehold-
ers. This might include:

Access to socially responsible investor capital.

Attracting and retaining the best talent.

Building brand loyalty and reputation with customers.

Accessing strategic resources and capabilities through partners.

Improved employee relations and conﬂict resolution with unions.

Increased efficiency and collaboration across the value chain.

Greater inﬂuence, favourability and ﬂexibility with regulators.

Mutual support and accommodation in local communities

Similarly, a reliance on processes and systems based on facts and analysis is useful in that they
add rigour and discipline, but they are not the source of new value creation.

Intelligent, logical thinking does not deliver the balanced, holistic approach that today's
organizations require. Knowledge management does not usually drive creativity. CRM is rarely
the route to customer intimacy or loyalty. Six Sigma and TQM do not secure innovative designs.
Performance incentives do not create more fulfilling jobs. Quarterly performance targets do
not secure successful futures. Maximizing shareholder value does not necessarily deliver a
sustainable or responsible business.
Business today requires a more enlightened approach, a more balanced and holistic approach,
one that is both creative and analytical, embraces soft and hard, customer and finance, short
and long term. These are delivered through broader-thinking people who can see business
through each of these lenses and have the personal attributes and awareness to take this new
approach.

Marketing must create the future and deliver today

Marketers, and business in general, must learn to embrace what can often seem like contra-
dictory objectives and expectations - to maximize sales in the short term while also investing
for the long term. From a financial perspective this means maximizing revenues and profits
today, but also tomorrow, the balance of which is captured by considering the economic value
of actions, and thereby embracing the short and long term. Most fundamentally, marketers
must bring the outside-in perspective to balance, and often lead the inside-out aspects of
business.

No company reﬂects the need to live and work in 'double time' more than Microsoft. The busi-
ness, marketers and developers are constantly focused on delivering today while also creating
tomorrow. Once a current version of a product is released (with all its qualities and sometimes
some failings) it is up to marketers to maximize the scale of its take-up, selling as many licences
as possible. However, once the product is released, the developers are immediately on to the
next version, or something much more radical for the future.

'At Microsoft we work to help people and business throughout the world realize their full
potential. This is our mission. Everything we do reflects this mission and the values that
make it possible.

At Microsoft we are motivated and inspired every day by how our customers use our
software to find creative solutions to business problems, develop breakthrough ideas,
and stay connected to what's most important to them.

Just as we constantly update and improve our products, we want to continually evolve
our company to be in the best position to accelerate new technologies as they emerge
and to better serve our customers.'

This is then translated into value statements and straplines, such as 'Your Potential. Our Pas-
sion', consistent with the core purpose but relevant to each audience.

For businesses:

'We see business without borders. You should have the ability to do business with
anyone, anywhere. When business speaks a global language, the barriers disappear, and
we believe technology can help. It inspires us to create software that brings companies
closer to their customers and partners, regardless of language or location.'

For educators:

'We see history's great minds dropping in wherever they're needed. Exposure to
great teachers, great books, and great thinking, is the most essential requirement for
learning, no matter where the student or the classroom. When the world of learning
opens to them, children can grow in any direction. It inspires us to create software that
helps them reach their potential.'

For parents:

'We see the king of the skies. Children dream of flight, to soar. These dreams become
their potential. And with the right tools and a little help, they'll make them more than
their passion; they'll make them their life. This is just one of the infinite possibilities that
inspires us to create software that helps you reach your potential.'

Making of marketing Genius (e-Bay)

2009-05-29T21:39:00.000+03:00

Founded in 1995, eBay has styled itself as 'the world's online marketplace  for the sale of
goods and services by a passionate community of individuals and businesses'. It now facilitates
transactions worth over $35 billion, as 135 million registered members buy and sell goods
worth over $1000 every second.

It all started when the idealistic French-Iranian computer programmer Pierre Omidyar built a
website from his Silicon Valley bedroom and auctioned off his broken laser pen for $14.

He conceived what was initially called AuctionWeb as 'a place where people can come together'
- an online exchange that would never actually handle the goods sold but enable buyers and
sellers to determine a fair market price. He enlisted the help of the highly experienced marketer
Meg Whitman, who as CEO brought together a management team with experience from lead-
ing brands, from Pepsi to Disney.

While it is perhaps best known for its individual users who auction their junk and collectables,
it soon had many business users too. From IBM to sole traders, selling cars, computers, white
goods and services, they found that they could usually achieve better margins than they would
when reaching a more limited market, with the physical burdens of distribution and premises,
stock and discounting.

Browsing and bidding on auctions is free, but sellers are charged transaction fees for the right
to sell their goods. There is a non-refundable insertion fee based on the opening bid on the
item and, when the auction is complete, a completion fee that generally ranges from 1.25%
to 5% of the final price. There are also additional fees if sellers want to highlight their items in
various ways. Once the auction is finished, completing the transaction is left up to the seller
and buyer, while eBay collects its fee.

enables any individual or business with an e-mail address to securely, easily and quickly
send and receive payments online. This builds on the existing financial infrastructure of banks
and credits cards, and uses the world's most advanced fraud protection systems. It is available
in 45 countries and 5 currencies.

Indeed, PayPal, which was acquired by eBay in 2002, has become a leader itself, the world's
number one online payment system, with over 20 million registered accounts worldwide, and
is now used by many more retailers, online and ofﬂine.

To engage buyers and sellers, eBay must be more than a trading point. The community spirit
is strong too, with buyers and sellers often helping each other find what they want, and reach
a fair price. Through the Community Hub, members meet through participation in discussion
boards, chat rooms, online workshops, user groups and the Answer Center. This community feel
creates trust and more frequent visits, wraps people into the eBay world, as intimately as in
previous decades they would have been loyal to their local corner shop.

eBay is one of the few Internet 'pure plays' to consistently make a profit. Indeed, it has beaten
off the challenge of the likes of Amazon and Yahoo! which have tried to imitate the eBay model
as part of their propositions but with little success.
Application 1.3 POWER PROFILE Application 1.3 POWER PROFILE

How do we address the changing balance of power in our markets? How do we meet the
ever-higher expectations of customers, and shareholders? How do we continue to deliver
today while also having time, space and resources to create tomorrow?

1. Consider each marketing activity

Identify the key marketing activities,
e.g. brands, communications, pricing
relationships etc.

2. Who initiates each activity

Evaluate whether each is currently
business or customer driven, based
on who initiates and designs it.

3. Who is most powerful

Weight the influence of business
relative to customer in each activity,
e.g. who most determines price?

4. Profile the bias of power

Map this profile across each of the
major marketing activities.
5. Compare with your competitors

Consider how common this is to
competitor models. Are you more or
less powerful than competitors?

6. Harness customer power

How could the business model be
adapted to harness customer power
or respond more effectively to it?

Application 1.4 REVERSE MARKETING Application 1.4 REVERSE MARKETING

How do you rethink your marketing, and for that matter the whole way you do business,
to respond to the rise in customer power? What does it really mean to do business where,
how and when they want? How will the conventional processes for communicating,
distributing, pricing and selling change? What are the implications for strategy, brands,
innovation and relationships?

1. Consider each marketing activity

Identify the key marketing activities,
e.g. brands, distribution, communication,
pricing, innovation.

2. Map out each marketing process

Map out the typical process steps
involved in each, perhaps writing each
on a separate sticky note.

3. Reverse to start with customer

Reinvent the process to start with
customer (or more accurately, buyer)
changing the order of the steps.

4. Add what matters most to them

Consider the customer's likely choices
of what, when, where and how, and
re articulate appropriate notes.

5. Make the process more flexible

How could the process be flexible to
do business on their terms, for each
customer differently each time?

6. Add customization to it

How could the process be personalized
through better customer knowledge,
customization and service delivery?

Making of marketing Genius 5

2009-05-28T18:38:00.000+03:00

So how do you keep pace with the rapid pace of markets? How can you get ahead of the curve
rather than behind it?

Like the athlete who is most likely to win the gold medal, the strong company will learn to
control the pace, choosing when to set it, when to slow it, when to just go with it. The key to
this is to align the rhythm of the business to the pace of the market. Every business already
has a rhythm, usually driven by its planning cycle internally - typically an annual event, with
a rolling 3- to 5-year horizon. Product development cycles are driven internally by the fre-
quency of market research, and the complexity of product development and market entry
processes. Externally, the pace might be driven by industry events - the IATA conference for
airline schedules, the major fashion shows in clothing design, or the GSM World Congress in
mobile phones.

Organizations can break these natural rhythms and create new ones: planning cycles once a
quarter rather than annually, accelerated product development processes can radically reduce
time to market, and more modular business design can enable business structures themselves
to rapidly morph to exploit new capabilities and market opportunities.

However, like the athlete who is most likely to win the gold medal, the most successful
companies can set the pace to their own advantage - be it fast or slower, they can exert
inﬂuence that conditions how others behave. Armani can inﬂuence fashion show organizers
and Nokia can inﬂuence whole supply chains, regulators are strongly inﬂuenced by leaders
who drive economies, and retailers are reluctant to go without P&G or Unilever products on
their shelves.
Indeed, rather than just synchronizing your business to the market, a leader might seek to
create a rhythm slightly faster than the market, so that they lead rather than lag - they are
the innovators rather than imitators. This might be achieved by working to a 10-week cycle
rather than a 12-week cycle in fashion, by being faster to spot trends like Puma, or by having
the earliest adopters hooked into your brand like Apple. And if they are effective in executing
their market entries, they can define coolness and charge a premium for it, before the mass
market arrives.
Starbuck, a character from the novel Moby Dick, first came ashore in 1971, having until that
time been the name of a fishing boat in Seattle harbour. Instead it became a coffee house in
Pike Place Market.

A decade later Howard Schultz arrived as director of marketing, moving the focus away from
coffee grinding to Italian-style espresso bars, billed as the 'premier purveyor of the finest
coffee in the world'. A trip to Milan in 1983 convinced Schultz that coffee bars had significant
potential outside Italy, prompting him to set up his own 'Il Giornale' cafes in 1985, which then
acquired the original Starbucks business and adopted its name two years later.

The roll-out of Starbucks Coffee then started. Indeed, the speed at which coffee has culturally
evolved from a cheap instant drink to a premium coffee shop culture is phenomenal. Styled as
'the third place', Starbucks claims that 'there's home, and work, and then there's Starbucks'. The
environment, with its sofas and music, encourages people to linger as long as they want
Schultz recognized that corporate deals, with airlines, retailers, and corporations to offer Star-
bucks within their own facilities, were a fast track to growth. Indeed, the coffee bars were fuelling
such a strong aspirational desire among consumers that having Starbucks as part of their airline,
retail or work experience immediately offered added value and enhanced prestige.

Coffee branding was important too. The 'Christmas Blend' coffee, together with its festive
paper cups, was a hit from year one. In 1994 'Frappuccino' became a best selling ice-cold blend
of coffee and cream, and was quickly bottled and sold by many other retailers too.
Schultz explains that there is no hidden secret to his success:

'We have no patent on anything we do and anything we do can be copied by anyone
else  but you can't copy the heart and soul of a business. That's created by people.
People who know what they are doing, why they are creating a special experience for
every customer, and how to make it their personal third place.'

Every employee who works more than 20 hours per week, which is most, is given share options
in the business, and so they feel even more part of its mission and share in its success. Indeed,
Starbucks has created many millionaires out of its employees along its path to growth.

Customers have evolved too as Starbucks has matured. There is now a diverse mix of young and
older customers, from all backgrounds, who have been attracted by the coffee and the place.
Indeed, the ability to customize your coffee is important too. Most customers will have their
favourite - whether it be a 'double grande skinny latte' or a 'vanilla tall no-fun cappuccino',
their language and preferences have evolved too.

Schultz visits his own and his competitors' stores around the world. In his own stores, he typi-
cally drinks five coffees a day - different varieties at different times. However, he never drinks
his competitors' coffee. 'I know what it's going to taste like,' he says rather dismissively.

Of course, Starbucks is not without its detractors, most famously Naomi Klein in her book No
Logo, which, while appreciating many of the positive aspects of marketing and increasingly
global brands, also cautioned against their potential for cultural arrogance and trading domi-
nance. Indeed, Starbucks has been careful to embrace Fair Trade coffees, and ensure that it
acts responsibility both locally and globally, encouraging its entire staff, for example, to get
involved in local charitable projects.

Starbucks defines its purpose as 'to provide an uplifting experience that enriches people's daily
lives'. It seeks to achieve this by establishing Starbucks as 'the premier purveyor of the finest
coffee in the world, while maintaining our uncompromising principles as we grow'.

Application 1.2 MARKET VORTEX Application 1.2 MARKET VORTEX

How can you achieve leadership in rapidly changing markets? How can you be on the leading
rather than lagging edge of the waves of change in your market? How can you drive the change
vortex in your vision, rather than be left in the wake of others?

1. Consider your future market

Map out most significant industry
changes in your market over last ten
years, e.g. new entrants, deregulation.

2. Identify key drivers of change

Evaluate the most common
drivers of change in your existing
or adjacent markets.

3. What impact might this have?

Identify the most disruptive events
likely to occur, how often, and how
competitors would likely respond.

4. Where could you interject?

Evaluate the likely changes, and which
you could most effectively influence
to become the profitable market driver.

5. Create a new vortex of change

Create a vortex of change in the market
whereby you redefine the market,
with new approaches and standards.

6. Change your rhythm of business

Consider how you should change the
rhythm of your business cycle to
align it with market change.
New markets need new marketing, not just to manage the complexity, or to shape it before
somebody else does, but to recognize that the fundamental dynamics of customer transactions
have changed too.

Customers now call the shots. We have moved from markets of surplus demand to those of
surplus supply. There is far more stuff around than customers need. And they have everything
they want. So how do you sell more to them?
Creative intelligence is required to develop solutions that do more for customers than their
product functionality, to go beyond customers' finite needs.

In our busy lives we have little time to indulge, or to connect with communities in traditional
ways. Space is limited as we keep buying more, and support is expected as our tolerance levels
fall. Brands must do much more to educate, to entertain, and to inspire. Education is infinite,
you can never have enough entertainment, and art has no bounds.

How can marketers develop propositions, interactions and solutions that enhance people's
lives in these ways? Either as a means to help differentiate us from the competition, or to add
value and thereby charge more? Such factors - time, space, education - could also become
currencies, more important than money, in which we do business.

Doing business on customer terms means we must engage them differently too.

Customers are hard to reach, its difficult to get their attention, they have high expectations,
and are even harder to retain. We must go to them, rather than they come to us. They are not
customers of ours. They are our buyers, belonging to themselves. We need to do business how,
where and when they want.

Campaigns are dead.

The idea that we can sell people a new car when it fits into the marketing department's cam-
paign schedule doesn't work. Campaigns inevitably have a mass market, inside-out feel to
them, which doesn't work in a diverse and devolved world. New forms of communication, part
initiated by customers, while still retaining brand awareness, are needed.

Channels must invert.

Similarly, distribution channels were set up as extensions of the supplier, not the customer
- travel agents were agents of the airline, rather than the customer. Suppliers used to define
the prices; customers were required to pay. The agent was incentivized to sell on their behalf.
Five minutes on eBay will show you that pricing doesn't work like that any more.

It is unlikely that many of these problems can be solved by one supplier alone, indeed few
buyers know exactly what they want, or where to get it from. However, when customers are
demanding, this is an opportunity to go and help. The brands that customers know best and
trust most to resolve their uncertainty, who can source whatever is required and knowledge-
ably customize it to the buyer, in the most convenient way, will succeed in future.

Power has fundamentally shifted from supplier to customer.

Making of marketing Genius 4 keep going

2009-05-27T22:37:00.000+03:00

Your market map might be based on any combination of attributes - such as capabilities versus
applications, products versus location of use and products versus type of customer. The levels
of change will depend on the market and other factors too.

A more sophisticated approach to market mapping might therefore also embrace techniques
such as Market Radar, which considers the likely evolution of markets in terms of economic,
competitive, customer, technological, social and political change - each mapping what is
certain, likely and possible.

Scenario development can also be used to combine different possibilities into future market
scenarios, then evaluating the upsides and downsides of each, and estimating the overall
likelihood. If many scenarios predict certain aspects more frequently, then its likelihood will
increase.

The output, intuitive or sophisticated, is a better understanding of your 'real' market today, and
the challenges and opportunities that may well not be visible from a traditional perspective.
The best opportunities should then be evaluated in terms of risk and reward, as described in
the next chapter.

As an example, consider a local convenience store. On one axis we might plot the range of
goods the store sells; on the other we plot the reason why a customer might use the shop.

Starting at the origin, the store currently sells food and drink. However, the store could easily
sell ﬂowers and newspapers, or even books and music, or perhaps even local or utility services.
Beyond top-up shopping, the customer might shop for gifts, the weekly family shop, large
occasional items, or seek advice on new services.

On the resulting grid we can then plot where there might be significant demand, who the customers might be,
the competitors, and innovatively how we might deliver such a proposition

Inspiration 1.2 APPLEAPPLE In piration 1.2

Apple has long been famed for its 'think different' mindset. Founded in 1979, in the pioneering
days of the personal computer, the Macintosh was the great rebel of the industry, loved by the
highly demanding graphic designers who harnessed its leading-edge features, but a rebel in
refusing to bow to the growing power of Microsoft Windows.

Sometimes in those early pioneering days of the technology revolution, they were first to admit
that they missed the mark, thinking as product inventors rather than market innovators. The
Mac was technically advanced, but resolutely niche.

Years later, Apple was back in the forefront with that iMac, proving that PCs don't have to be
grey and boring, seeking to bring exceptional design both aesthetically and functionally to the
user's operation. The iMac was a great hit - now compatible with Windows - yet it was still for
the knowing few rather than the profitable many.

Apple is one of the leading brands profiled by Kevin Roberts in Lovemarks. On the book's related
website, people are encouraged to rank and talk about their own 'lovemarks'. Apple, not surpris-
ingly, figures highly on the site, with many contributions like the following:

'An Apple computer is the first thing I switch on every morning and the last thing to be
turned off every night. Apple's computers enhance my life, and make what I do possible
in a way similar products by other makers never do. Apple's story, their myth, their mys-
tery is unassailable. I never cease to be fascinated.'

After the candy-coloured range of iMacs came the revolutionary iPod.

Recognition that the new millennium lives by new rules.

Digital music formats were struggling to move beyond the CD and the retailer. Napster was the
rogue, illegal download website. Everyone could see a market ﬂex but were uncertain where
the future would go. Should record companies abandon physical formats? Should artists aban-
don record companies? Would network providers or phone companies seize the space?
Apple saw the opportunity and quickly made the iPod a cultural phenomenon. The comple-
mentary iTunes download site quickly became the global leader in downloadable music, selling
more than 70 million songs in its first year, and for the first time a serious threat to the old
physical world.

Apple's shift can be simply illustrated by a market map, showing the rapid evolution of tech-
nology - from the wired desktop to the wireless handheld, while the consumers' tolerance for
such devices now went well beyond work. Apple is constantly disrupting the conventions of
the market, and expectations of the customer. For example, the low-price, limited functionality
iPod Shufﬂe was a shrewd move to ward off any low-end imitators of its iPod.

The next evolutions are probably still in the head of Steve Jobs; however, by extension of the
axes, or consideration of other dimensions, we can see the possibilities.

Application 1.1 MARKET MAPPING Application 1.1 MARKET MAPPING

How do you make sense of complex markets, where borders have blurred and it is no
longer clear which market you are actually in? Where are the hotspots or cool places for
brand extensions? Where are the black holes?

1. Scope your customer base

Define your existing and potential
customers, their existing and 'adjacent'
needs and wants.

2. Scope your capability base

Define your existing and potential
capabilities, their existing and adjacent
Applications.

3. Define new market dimensions

Choose the most appropriate pairs of
dimensions (axes) along which to map
your market (see Apple example).

4. Map existing markets

Plot the existing market categories and
the key players against these
Dimensions.

5. Explore new opportunities

Explore potential new areas, including
the hot spots and white spaces, where
you could refocus or extend into.

6. Evaluate the market options

Consider the most valuable options
for market development and
strategic positioning.

Jack Welch argues, 'When the rate of change inside the business is exceeded by the rate of
change outside the company, the end is near.'

Today's markets can evolve incredibly quickly. New ideas and structures, standards and expec-
tations can spread in a way that was previously reserved for fads and fashions. Speed is driven
by the connectivity of people through technology, the rise of non-locational communities and
the constant desire of consumers to have the latest, best, coolest, smallest, fastest devices.

Whether it is the latest multi-disciplinary mobile phone, or a new range of Puma shoes, or the
latest interactive game, as soon as it enters one market, it enters all markets. In the past, movies
were shown in North America up to 6 months before Europe. Within weeks of release in LA, it
will now be bootlegged in the shops of Bangkok or available online to people anywhere.

Similarly with products; the rapid and repetitive disruption of the data storage market shows
how large ﬂoppy disks were displaced by smaller disks, and they by CD-ROMs and they by USB
devices. The benefits of each new device were huge - scaling up storage capacity many times,
shrinking in size, cheaper and more convenient. Once the new device hits the market, every-
body wants it everywhere. And one click of amazon.com can deliver it within days.

The effect of networks, the viral impact of communication across them, the contagiousness of
new ideas. Hotmail, launched by Microsoft as a free online e-mail service, went from launch to
leadership within days. Without any traditional marketing to boot. The bottom of every e-mail
sent by a Hotmail account holder contains an invitation to the receiver to set up their own
free account. Yes, they needed early adopters to start the ball rolling but, after a few days, the
snowball was enormous - 100 million people in the case of Hotmail.

The same effect can be seen in every other market too. Speed is also perpetuated by the expec-
tation of newness and intolerance of oldness. It is spurred on by intense competition and the
deliver new products to market faster than ever before. Car manufacturers launch
models every year, and sometimes new editions every quarter, while in the days of Henry Ford,
the cycle times were more like decades.

Clothing retailers will launch new ranges at least once every season; although, now that is the
convention, to be fashionable requires a new range every few weeks. Visit a Zara clothing store
one week and it is unlikely to be stocking the same clothes when you return a few weeks later.
Make your mind up now or it will be too late. And, indeed, to get there before anybody else,
Zara's designers don't wait to see what's the latest fashion on the catwalks; they go straight to
the yarn mills of Milan to find out what's emerging. You can now buy the high street imitations
on the same day that the new designer range is modelled.

Cycle times are much faster and shorter, more unpredictable yet more powerful. We live in
a constantly evolving state of newness. When is the best time to buy a new laptop? Never.
Because whenever you buy it, it will inevitably be displaced by something better in a few
months, and your own model, while completely adequate, will have its price slashed because
enough people still want the latest thing. At the same time, this creates a whole secondary
market for remainder items - and the rise of stores like TK Maxx in the clothing market, selling
massively reduced designer clothes only a few months 'out of date', and indeed challenging
the full-price unbranded items of mass market chains.

Speed can often be witnessed in the form of 'vortices' within markets, a little like highs and
lows that drive our weather systems. The difference is that these vortices are typically man-
made, or through the competitive and customer responses to deliberate actions. Each vortex is
the result of significant change and creates a significant impact on its surroundings. As a new
idea develops, the vortex builds momentum, and its increasing centrifugal force draws nearby
competitors and adjacent markets into its reach.

The market-driving business, seeking to define its markets in its own vision and advantage, will
often need to create such vortices, but it also recognizes the wider consequences of its own
actions. In the early stages it will be more isolated, creating new opportunities fairly remotely
from what else is going on. However, it then starts to affect others as competitors respond,
and the business needs to step up to leading the 'game change' rather than just defining it.
Ultimately new market conditions start to form, and the business must actively shape these
new structures as it normalizes.

Making of marketing Genius (Kodak)

2009-05-26T17:36:00.000+03:00

Concept MARKET SPACE

Kodak used to know where it stood - the brand leader in the photographic film market. The
markets and competitors, customers and products were all fairly predictable. Over the decades
camera film came in many different formats and sizes, yet everyone knew that Kodak film was
the best, better than Fuji film or Agfa.

Ten years later, Kodak's position is increasingly unclear - what market it is in, who the competi-
tors are, what customers want, or which products to focus on. Digital disruption has displaced
traditional film, and previously separate markets of hardware devices, software and processing,
imaging and printing have all converged.

Digital cameras come from Sony or Dell, images are stored on your hard drive, shared by e-mail,
and if you still want the physical images then processing comes from Snapfish or Jessops, and
printing from HP or Epson. Kodak has tried to respond in every direction. Kodak cameras, Kodak
online wallets, Kodak printers, Kodak print kiosks. It describes itself as an imaging company, but
neither its focus nor future are clear.

Market and technological convergence, the irrelevance of physical boundaries, the changing
needs of consumers and retailers, and competitors emerging from previously unrelated mar-
kets have created complexity in every sector.

Today it is hard to know what type of business to call yourself, to distinguish a competitor
from a collaborator (although they might be one and the same), and where you should bet your
future. Not only is the market different, it keeps changing too.

So what are the drivers of change?

They are largely driven by technology, but also sociological and economic factors. The drivers
include:

Rise of computing power, interactivity and virtual networks.

Compression of distance and time, and the speed of change.

Irrelevance of geography, borders and hierarchies.

Frictionless economics and corporate transparency.

Rapid imitation of new products, and shortened life cycles.

Globalization of culture, alongside religious difference

Moore's Law emerged during the 'dotcom' boom and, unlike many of the companies it was
initially associated with, it is still going strong. Gordon Moore, the founder of Intel, observed
that computing power doubles approximately every 18 months while costs remain the same
(or, put another way, the same power can be squashed into a chip half the size). This relentless
improvement drives much of the short life cycles and obsolescence we see in products today.

However, the power of the Internet goes far beyond the devices through which we access it.
More significant than Moore's Law is the related Metcalfe's Law, which explains the power
of networks and the way in which they drive new forms of interactivity, and can quickly build
powerful communities and achieve great scale and reach. Robert Metcalfe, who launched
3Com, suggested that the power of a network is related to the square of the nodes. Therefore,
every additional member has a disproportionate impact. Think of eBay, for example, where the
network of users and diversity of goods creates the proposition.

The changing environment is accompanied by new practices, issues and regulations, present-
ing business and marketing with new challenges. The rise of more aggressive telemarketing
approaches, such as the highly irritating recorded messages that interrupt your home at any
hour of the day with highly misleading suggestions that 'you have just won a major prize'
has prompted a majority of US households to 'ban' such practices by registering at donotcall.
com.

More general examples include:

Demand for customer privacy and ownership of personal information.

Customer backlash against the avalanche and intrusion of direct marketing.

Rise of social issues and ethics, from environment to transparency.

Deficit of customer trust, and prevalence of competitive promiscuity.

Globalization of brands, leading to cultural sameness and classlessness.

Importance of intellectual properties, and value of intangible assets

Customers are more different and intelligent, their expectations are higher and they are more
powerful than ever. Research by Martin Lindstrom in BrandChild, for example, shows that
kids can cope with complexity far better than adults: they can do 5.4 things at the same time
- watching, playing, talking, texting, eating simultaneously - while adults can manage 1.7
(men even less).

Some of the broader implications are:

Western populations are more afﬂuent but with less time to enjoy it.

Older people are wealthier, with time, and want to travel the world

Kids grow up fast, quickly replacing baby toys with designer fashion.

Rise of online communities, buying groups and political lobbies.

Concerns about health and obesity, the falling standards in sports.

Many of us have everything we need, yet we still want more.

These structural and behavioural changes fundamentally reshape markets, making profitable
ones unprofitable, requiring new ways to approach existing ones, and opening up completely
new spaces to compete. Indeed, it is useful to draw an illustrative map of your extended 'market
space', your existing and adjacent markets, adjacent in terms of both business capabilities and
customer applications.

Within this extended space you can then plot where the best opportunities are likely to be,
now and in the future. And where the competition is now, and likely to be. You can then begin
to identify:

Hot Spots, where demand converges and all brands seek to play, e.g. multimedia phones,
the integrated computer and TV.

Cool Places, where lead users go in search of newness and difference, creating niches or
the next big thing, e.g. Korean food, Smart cars.

White Spaces, where new opportunities emerge, often through convergence. They have
not yet been exploited, such as iTV retailing, or cashless wallets.

Black Holes, where traditional markets dry up, and the lead players are blindsided and
marginalized, e.g. the music industry, the car manufacturers

While this might sound impractical, far from the conventions of your own markets today, it
actually describes the morphology of every market today. From sheep farming to corner shops,
from industrial manufacturing to food restaurants, markets are more connected than ever, and
inﬂuenced by outside change.

Market mapping is a strategic tool that helps you make sense of your changing marketplace,
to spot the challenges and opportunities first.

The rapid convergence of mobile phones and cameras is just one example where not only
should the camera-less phone manufacturer be worried, but the camera manufacturers should
be too. Many people upgrade their handsets every year; therefore, adoption, and obsolescence,
can be incredibly rapid.

There is no one authoritative map for any market, as there is no certainty as to how it will
evolve. Market maps are therefore predictions, your own view of your markets and their future.
Others will have different starting points, and different perspectives. Indeed, your future com-
petitive advantage is likely to come partly from how well you can draw the market map relative
to others.

Making of marketing Genius (Google)

2009-05-25T22:34:00.000+03:00

Inspiration

'Googol' is the mathematical term for a 1 followed by 100 zeros. It perhaps symbolizes the
magnitude of Google's ambition and increasing impact on the whole dynamic of markets and
marketing.

In 1995 Larry Page and Sergey Brin created in their Stanford University bedroom what within
5 years would already be dealing with 100 million Internet searches every day, and make them
multi-billionaires in less than a decade.

Google has a simple vision, to be 'the perfect search engine' or, as Page puts it, 'one that under-
stands exactly what you mean and gives you back exactly what you want.' Now with over 80
million users, searching through 8 billion web pages, Google is well established as the world's
leading search engine.

Indeed, most marketing today starts with 'a Google': textbooks don't include it in their theories
of communication ﬂows, and few ad agencies would dare admit it, but it really does represent
the customer taking control, the customer-initiated transaction, the customer seizing power
in today's complex world.

Brand awareness is achieved through word of mouth and the viral impact of click-throughs
from many other sites, and revenues are driven by enabling advertisers to target online users
in highly sophisticated and efficient ways.

Google argues that this makes the advertising useful to customers as well as to the advertiser
placing it. It believes customers should know when someone has paid to put a message in front
of them, so seeks to distinguish ads from the search results or other content on a page. Indeed,
Google doesn't sell placement in the search results themselves, or allow people to pay for a
higher ranking there.

Thousands of advertisers use Google AdWords to promote their products and services on the
web with targeted advertising, the largest program of its kind. In addition, thousands of web-
site managers take advantage of the Google AdSense program to deliver ads relevant to the
content on their sites, improving their ability to generate revenue and enhancing the experi-
ence for their users.

The basic ranking system is a model of customer democracy - search rankings determined
by the most popular sites, and assisted by those sites that encourage more open networking,
linking one to another.

Google stays strong in a complex world by sticking to its philosophy built on 'ten things'. While
their self-beliefs have often challenged conventions - not just in disrupting markets, but also,
for example, at the time of their 2004 Nasdaq ﬂotation when they insisted that investors
should not treat them like a 'normal' company - their convictions are the empowered guidance
that keeps them ﬂexible but going in the right direction.

Focus on the customer and all else will follow. While many companies claim to put their
customers first, few are able to resist the temptation to make small sacrifices to increase
shareholder value

It's best to do one thing really, really well. Google does search. Google does not do horoscopes, finance advice or chat. Our entire staff is dedicated to creating the perfect search
engine

Fast is better than slow. Google believes in instant gratification. You want answers and
you want them right now. Who are we to argue?

Democracy on the web works. Google works because it relies on millions of individuals
posting websites to determine which other sites offer content of value

You don't need to be at your desk to need an answer. The world is increasingly mobile
and unwilling to be constrained by a fixed location  through their PDA, mobile phones
or in their cars 

You can make money without doing evil. Google is a business. Our revenues are derived
from offering its search technology to companies and from the sale of advertising 

There's always more information out there. Once we had indexed more pages than any
other search service, we focused on information not readily accessible, such as images or
PDF. files 

The need for information crosses all borders. Google facilitates access to information
across the entire world  the interface can be customized into about 100 languages.

You can be serious without a suit. Our founders wanted to a create a company not serious
about anything but search  work should be challenging and the work should be fun 

Great just isn't good enough. Always deliver more than expected. Through innovation
and iteration, we take something that works well and improve upon it in unexpected
ways.

Making of marketing Genius

2009-05-24T17:29:00.000+03:00

How do you succeed in markets that are incredibly complex and uncertain, intensely competitive and fast changing, where customers and shareholders constantly demand more,
and the conventional ways of marketing just don't work anymore?

How do you make sense of today's markets? How do you identify the best opportunities for
growth? How do you address the intensity of competition and rising power of customers?

How do you meet the high expectations of customers, employees and shareholders? And
indeed of society? How do you reconcile their different needs? How do you create exceptional 'value' for all of them?

What does it mean to be a genius? How is a genius different? How do they combine intelligence and imagination? What does it mean to be a marketing genius, and how does it

achieve better results?

Making sense of uncertain markets

Complex markets, intense competition, expectant customers and demanding shareholders require more intelligent marketing. To see the emerging form of markets and how they can be shaped, to target the best opportunities before others, to beat competitors in smarter ways than price discounting, to innovate more radically in new directions, to build brands like nobody else, to engage with customers in ways they have never thought possible, and to deliver returns
to shareholders that would make analysts jump requires a new and different approach

Outside in

Complexity. Markets are incredibly complex, blurred and fragmented, borderless and unpredictable.

Speed. Market change is constant and accelerating. New challenges and
opportunities emerge rapidly.

Power. Customers now call the shots, demanding you do business outside in,
what, where, how and when they want.

Competing in fast changing markets, where borders have fallen and rules are broken, can be a
disorienting experience. Take, for example, today's world of communications - to some com-
panies they are in the telecoms business, others the broader communications market, others
the IT or networking world. Your perspective determines your competitors, your solution set,
your customers, and your potential for success.

Does this make a difference? The narrow-focused telecoms company may start to wonder
where their customers have gone, while the communications company might struggle to be
relevant to those with a specific telephony need. The guys in the IT space may pitch their
pricing relative to an IT peer group, which would be perceived to be expensive relative to the
niche market. However, if the target customer is in the IT mindset, then it could quadruple your
margins. Yes, it makes a difference.
Making sense of complexity requires intelligence. Bill Jenson wrote the book Simplicity, which
seeks to interpret today's world into dimensions you can get your hands on. However, as the
quantum physicists realized, complex problems require complex solutions. And while the result
might look admirable, the derivation is not easy. Nothing is certain; everything has a level of
ambiguity about it. And everything is connected to everything else in some way.

We could do well to remember relativity and uncertainty into today's world. Not only do the
old ways not work, but complexity also throws up many new opportunities if you have the right
mindset. However, the director who sits round the boardroom table and recites, 'In my day, we
looked at these things simply' is probably missing the point, as is the marketer who seeks to
apply simplistic, conventional models to the complex challenge.

Take customers. They used to come in a range of similar shapes and sizes. We called them segments. We could predict that people with similar sociodemographic labels would behave alike
and want similar things. Not so today. Not only are people more different, resulting in many
more highly fragmented segments, but they are also less predictable, behaving in different
ways at different times, and therefore in many different segments depending on the occasion,
or even the mood.

Marketers need deeper logic and more creativity to succeed amidst complexity.

Brands must reorientate to compete within these new market dynamics. However, the first
step is to choose where and how you want to compete in this new world. Only in this way can
you decide the kind of company you will be, the type of audience to pursue, the type of value
proposition that will make sense. Only in this way do you have a chance to define the future in
your own vision, to ensure that you are part of it, and a leader within it.

The blurring of boundaries, of virtual and real worlds, and fusion of previously unrelated industries, is a daunting challenge but also a fantastic opportunity. The creative possibilities within today's connected world are endless. Almost any brand can work with any other, or against each other, in markets that used to have no connection. Whether it is Time Warner bringing together the disparate worlds of magazines, movies and networks - or a single brand like Virgin reaching out into many seemingly unrelated service offerings, there is immense potential to be realized by those who have the dreams and brains, confidence and persistence to realize it.

Play 2

2009-05-23T22:26:00.000+03:00

What has inspired me? What has inpired me?

Work experiences have not been my only inspirations, and nor should they be yours. Our perceptions and ambitions, the way we think and our confidence to act differently comes more
from experiences outside the workplace. All sorts of personal experiences, large and small,
have inspired me.

My first real experience of a market was in the small town of Rothbury, where I grew up. Every
Wednesday I watched convoys of farm trucks arrive from every direction to buy and sell their
cattle and sheep, and then depart again at the end of the day.

My parents always encouraged me to try new things, and from this grew my passions. Even
when I traded in music lessons for the local running club, my Mum still encouraged me, and my
Dad would drive me to races every week. I would never have done many things without their
support and encouragement.

I loved winning too, in whatever I did. Once you taste success, you want more of it. I will never
forget the first time I won the district schools' 1500m race as an 11 year old. And from that day,
I was never afraid of putting myself on the line, in the pursuit of faster times, and the pure joy
of sprinting through the finish tape before anyone else.
At university I had a scientific curiosity. I studied physics, and in particular the superconductiv-
ity of atomic particles when cooled to -200 degrees Celsius. Yet, while I was fascinated by the
many still unexplained properties of nature, I was quickly bored by the need to solve long and
repetitive algebraic equations.

Meeting your future partner is an electrifying moment. I will never forget the excitement of
getting to know my wife Alison, who over the years has become my best friend, my motivation
to do what I never thought possible, and my link to reality.

Of course I had sporting heroes like everyone else. Watching Sebastian Coe defy injury and
illness to win his second Olympic gold medal, Steve Cram break world records every week, and
Jonathan Edwards jump to lengths he just could not believe. I can still remember the dates,
times and distances.

In the business world, the opportunity to innovate was what made me tick. In particular, working with colleagues and agencies at British Airways to truly let go of our beliefs and inhibitions, to create breakthrough ideas that would seek to redefine the travel industry, shaped my
attitudes and ambitions.

Sometimes just being there is important too, to observe actions and sample the atmosphere. I
was fortunate to work in Silicon Valley during the late nineties, to feel the energy and ambition
of the entrepreneurs and investors who clambered to make their technological fortunes.

Perhaps most important in thinking about genius was meeting the successful people inside
some of the world's great brands. From the outside they were names that I was in awe of.
Inside, they were ordinary folk, desperate to learn from other companies and to improve what
they do.

And at the end of the day, there is nothing like two young children to bring you down to earth.
They rekindle the innocent joy of play, to sing and dance, talk and laugh, like nothing else in
the world matters.

are some of the little things that have spurred me on. I am sure that you too have your
own set of experiences that inﬂuence your beliefs and perspectives, guide your judgements
and ambitions.

They have conditioned the way that I look at brands and their marketing, the way I read the
many marketing books and learn from the companies and people around me. Books, of course,
merely offer a point of view, and best practices are only one way to deliver results. The chal-
lenge is to select and apply the best ideas and insights in the right way for your business

What will you learn? What will ou learn?

Imagine if you could see the emerging opportunities in your markets as well as Apple's Steve
Jobs, address them with the vision of Jeff Bezos at Amazon, the leadership of eBay CEO Meg
Whitman, and the commercial success of Nike's founder Phil Knight.

Imagine if you could transform your industry with the direction of Michael Dell, the innovation
of James Dyson and the persistence of low-cost airline king Michael O'Leary. Imagine if you
could build powerful brands like Scott Bed bury did for Starbucks and Nike, with the irreverence of Jones Soda founder Peter van Stolk, and the creativity of advertising's enfant terrible
Trevor Bettie.

Imagine if you could deliver experiences with the aesthetics of iPod designer Jonathon Ive,
the passion of sandwich entrepreneur Julian Metcalfe, and the effectiveness of P&G's top
marketer, Jim Stengel.

Marketing Genius describes how you can do all of this:

Make sense of today's complex and changing markets, and distinguish the hot spots, white
spaces and black holes.

Become the driving force of your business strategy, identifying new sources of competitive
advantage.

Bring an outside-in approach to your whole business, and align the expectations of cus-
tomers and shareholders.

Balance delivering today with the need to create tomorrow, by gaining new insights into
what really matters to customers.

Build strong brands that engage and inspire people, and which also embrace a new level
of ethical and social responsibility.

Innovate products, markets and business models more radically, by harnessing technology
and design in creative and unusual ways.

Articulate customer propositions that are distinctive and compelling, and ensure that your
communication is contagious and unforgettable.

Connect with customers on their terms, in more knowledgeable and integrated ways,
when, where and how they want.

Serve customers in more personal, empathetic and human ways, delivering experiences
that are compelling and enabling.

Measure your marketing with accurate and actionable measures, optimizing your budgets
and resources for a better return.

Unlock the real economic value of your marketing, and realize your own potential as a
marketer.

Every marketer has the ability to achieve 'genius', to combine your intelligence and imagina-
tion, to think more strategically and act more effectively, and to do what you might never
otherwise have thought possible.

you? How will it help ou?

I hope that Marketing Genius gives you the confidence to do marketing that is more strategic,
innovative and commercial.

While I have included many concepts, case studies and tools to help you, this is not an exhaus-
tive guide to marketing, or a replacement for all the excellent theoretical texts.

Instead I seek to provoke your thinking, to illustrate connections, to highlight dilemmas, to sug-
gest alternatives, and to stimulate more thoughtful yet radical action that delivers improved
business results.

I hope it encourages you to see your market and business more holistically, to challenge con-
ventions both outside and inside, and to remove the fear of areas of business that you perhaps
understand less well.

Over the years, and in researching this book, I have become convinced that:

Markets, complex and fast changing, competitive and borderless, are the best sources of
opportunities for business today. They should be the stimulus and driving force of business
purpose and direction, priorities and alignment.

Marketing is the most important and exciting activity in business. It offers an essential
mindset for everyone, particularly business leaders, and is the engine of strategy and
brands, experiences and relationships, innovation and growth.

Marketers are more valuable to their organizations than ever. They bring an outside-in
perspective, with the ability to think creatively and analytically, strategically and practi-
cally, creatively and commercially.

If we can achieve recognition of this through practical actions and results, then marketing will
be a profession that we can all be proud of - respected by peers, valued by society, aspired to
by the best young talent, and the breeding ground of future CEOs.

Marketing is the key to delivering extraordinary business results.

You have the talent and opportunity to apply the intelligence of Einstein and the imagination
of Picasso, to make sense of markets and stand out from the crowd, and to deliver results that
even Warren Buffett would be proud of.

You could be a marketing genius, if you want.

I will never forget the inspirational words that I learnt in my early days of marketing: 'Whatever
you can do, or think you can do, begin it. For boldness has power, genius and magic in it.'

Be innovative. Be different. Be inspired.

Play

2009-05-22T22:16:00.003+03:00

Dear All,

Sorry for long time that we didn't met as I had Some software Prob. with my PC.
so we are now going to continue what we started.

After turn on we should start playing.

So you want to be a genius?

The genius of marketing lies in the ability to connect outside and inside, markets and business,
customers and shareholders, creativity and analysis, promises and reality. Genius marketers
have both the intelligence and imagination to seize the best opportunities, and to deliver
extraordinary results.

Marketing Genius is for marketers who want to make a difference.

While many people have challenged the rise of global brands, and the inﬂuence of marketing
on our lives, few have come to its difnce. Few have considered why good marketing matters
more than ever, its contribution to our economic wealth, and why it is the most exciting place
to work today. However, markets have changed; therefore, marketing is changing, and market-
ers need to change further if they are to achieve high performance.

Marketing Genius offers a radically new approach to marketing.

In fast-changing and competitive markets, it is not obvious where to focus investment short-
and long-term, or how to create and sustain exceptional value for customers and sharehold-
ers. Business needs marketing and marketers like never before. This book gives you the ideas,
insights and inspiration to build brands that are truly different, to develop more innovative
solutions and engage customers more deeply.
Marketing Genius is for everyone in business today.

Whether you are a communications specialist or market researcher, a brand manager or prod-
uct developer, marketing leader or CEO, this book is for you. If you work in strategy or finance,
sales or customer service, you will find it useful too. It is as relevant to large corporates as to
small businesses, and agencies too.

Why did I write this book?

I want to inspire you to think differently, and to do great marketing.

In recent years I have experienced some great marketing, alongside much mediocrity. I have
met many stimulating and ambitious marketers, but also many others who lack the confidence
to challenge the status quot, to make their great ideas happen, to seize the opportunity to lead
their organizations.

I want marketing to succeed, to be the driving force of business, and to have the inﬂuence and
respect as a profession that it deserves.

Marketing creates more economic value for business than any other activity, yet it is too
often seen as a marginal activity, a support function and a tactical cost line. Marketing has an
unmatchable power base from which to drive the business - understanding the market, championing the customer, leading innovation, building the brand, driving profitable growth.

This requires an approach that is more strategic and commercial, innovative and engaging.
Marketers must embrace the analytical rigour to connect passions with profits, but they must
not lose their creative spark to reach out for what is new and different. Too many businesses,
and their marketers, have become blinkered servants to process and numbers, which alone are
increasingly commoditized and outsourced capabilities.

In today's incredibly complicated world, every business faces enormous change, uncertainty
and opportunity. The best ideas will make companies great. Customers, rather than capital, are
increasingly the scarcest resources. Concept rather than knowledge management will matter
more in the future.

I believe marketers are best positioned to address these challenges and others like them:

People are more different - kids, for example, can typically do 5.4 things at once, while
adults struggle to do 1.7 (and men even less).

Traditional marketing approaches are under fire - 54% of US consumers have 'banned'
telemarketing.

Purchase decisions are made in an instant - the average decision about which brand to
buy is made in 2.6 seconds.

Markets are much more competitive than ever before - intensity has on average tripled in
the last 10 years.

Products are quickly imitated and outdated - life cycles have on average reduced by 70%
in the same time.

Customers face a confusing barrage of noise - the average person comes across approximately 300 messages every day.

Technology has become central to our buying behaviors - the Internet is used by 42% of
consumers before buying a new car.

Yet people rely on people more than ever - 75% of consumers say they trust personal
recommendation most.

Proving the value of marketing has focused our minds on metrics - yet 60% of brand
investments impact on future years, not this year.

Businesses are still incredibly short term - yet major investors look at the potential of the
business beyond the next 4 years.

The majority of a business' value is now based on intangible assets - accounting for 78%
of Fortune 500's market value.

Marketing talent is essential to business leadership - 21% of FTSE CEOs are marketers, and
deliver 5.9% greater TSR than others

Marketers have the unique talents to address today's intelligent and demanding customer,
to bring direction and focus to their organization, and to drive the future profits that sustain
business success.

What do I know about marketing?

As a marketer, I have worked for some of the most fascinating companies in the world.

From my early days at British Airways, where we spent many hours trying to work out how
to fit a bed into a business class cabin and still make money, to the brand and logistical chal-
lenges for Coca-Cola in entering emerging Eastern European markets, more radical solutions
have been needed.

At American Express we recognized that the brand had to be more than a plastic friend, but
had to convince the business leaders to step outside their safety zone. Then there were the
significant cultural challenges in making the ultimate technology firm, Microsoft, a more
customer-oriented business.

However, working with small companies has often provided the greatest learning experiences.
From government agencies to small bakeries in The Netherlands, to the astronomical rise and
then fall of Regus, the office service firm, small businesses have no alternative but to think

differently in order to beat bigger rivals, to make the most of their strengths, and do more with
less.

As CEO of the world's largest marketing organization, the Chartered Institute of Marketing,
with 60,000 members in 131 countries, I was privileged to meet great marketers in every part
of the world. I was motivated by the terrific energy and ideas that make marketers tick, their
passion for brands and customers, to make a more valuable contribution to their businesses,
and desire to succeed as a profession.

Tunr on 2

2009-05-17T02:35:00.000+03:00

Track 6 Customers

Consider what really matters to customers, and how to ensure that the whole company is
founded on a customer orientation.

Reject on the insights of Zara, the ethical approach of Café Direct, and the re-orientation of Procter & Gamble.

Learn to do business built on genuine customer insight and foresight, which is ethical and takes genuine responsibility.

Track 7 Innovationion.

Embrace innovation that is based on disruption and creativity, applied to everything from
products to business models.

Learn from the innovation of BlackBerry and 3M, and the

market-redefining success of
Cirque du Soleil and Ikea.

Embed innovation in your business through disruptive and

creative catalysts, and by man-
aging innovation in a more holistic way.

Deliver more distinctive and engaging marketing, in a way

that Pablo Picasso, one of the few
artists to become a legend in his own time, and Philippe

Starck, the French designer of hotels
and watches, would be proud of.

Track 8 Proposition

Explore what really creates value for customers today, and

how to articulate your offer in
a way that is distinctive and engaging.

Consider the brand propositions of Tesco, the sub-branding of

British Airways' Club World,
and the re-emergence of the Mini.
Learn to develop customer value propositions that stand out

from the crowd, through
compelling scripts and messages

Track 9 Experiences

Consider what creates a great customer experience, one that

embraces cool design, per-
sonal service and theatre.

Learn from the funkiness of Jones Soda, the function and form

of Paul Smith, and the
sexual thrill of Agent Provocateur.

Improve your customers' experience through customer mapping,

intelligent design, and
more intuitive and theatrical delivery.

Track 10 Connection

Explore why integrated communications, inverted channels and

new types of networks are
essential to connect with customers.

Re?ect on the direct approach of Dell, the digital revolution

of Amazon, the alignment of
MTV and the buzz of Krispy Kreme.

Learn to improve your customer connections through media and

channel integration, and
network marketing.

Track 11 Relationships

Consider the challenges of building customer affinity,

loyalty and partnerships in today's
promiscuous markets.
Explore the infectious loyalty of Panera Breads, and the

customer relationship building of
Centrica and Mercedes.

Learn to build better customer relationships through affinity

branding, loyalty ladders and
partner development.

Unlock the real value of your brands and marketing. Learn

from Warren Buffett, the world's
greatest financial investor, and Phil Knight's passion for

performance and profits at Nike, to do
great marketing that delivers exceptional business results.

Track 12 Performance

Consider how to embrace more rigorous marketing measurement

and optimization, inter-
nal and external reporting.

Learn from the value-based approaches of Cadbury Schweppes

and Diageo, and the brand
building of Stella Artois.

Improve your performance by embracing value-based marketing

scorecards and metrics,
and 'customer capital'.

Track 13 Marketers

Consider why marketers must be the organization's champions

of customers, innovation
and growth.
Learn from the marketing leadership of Nestlé, the

orientation of British Airways, and the
sustained growth of Disney.

Introduce a better approach to managing markets and brands,

and innovation and growth
in your organization.

Track 14 Leadership

Explore the leadership roles of marketers, functionally and

cross-functionally, and why
marketers make better CEOs.

Be inspired by the passion of Richard Branson, the discipline

of Jim Stengel and Terry
Leahy, and the leadership of Meg Whitman.

Learn how to be a more effective marketing leader and

manager, and how to inﬂuence and
drive the wider organization

Track 15 Futures

Consider a future business world built around intelligent

markets, insightful brands and
inspiring marketers.

Learn from the vision of Nike, the insight of Nokia, the innovation of Dyson and the innocence of Innocent. See the future of your markets and business, and how blogging, branding and the five balls might help.

You have the potential to be a marketing genius, seizing the challenges and opportunities of
today's markets in more intelligent and imaginative ways. But where should you start? How
can you and your marketing deliver extraordinary results?

Genius lab

A simple diagnostic approach to understanding how you and your team can achieve 'genius':
evaluating your marketing and personal strengths and weaknesses, and how you could become
a genius marketer, delivering genius marketing.

Profile 1: Genius Marketing

Profile 2: Genius Marketers

Diagnostic 1: High Performance Marketing Map

Diagnostic 2: High Performance Marketer Map

Genius catalysts

Fifty challenges for every marketer today - to make sense of markets and stand out from the
crowd, improve your ﬂuence and reputation in the business, and deliver exceptional business
results.

Genius source

250 inspirations to provoke your thinking and inspire your action. A selection of leading brands
and marketers, the most significant innovations and informative sources, to help you think and act more intelligently and imaginatively.

List 1: 50 Genius Brands

List 2: 50 Genius Marketers

List 3: 50 Genius Innovations

List 4: 50 Genius Concepts

List 5: 50 Genius Inspirations

Tunr on

2009-05-16T07:51:00.000+03:00

Every marketer has the ability to achieve 'genius', to combine their intelligence and imagination in more strategic, innovative and effective ways. I hope this book inspires you to think and
do what you might never otherwise have thought possible.

How do you succeed in markets that are incredibly complex and uncertain, intensely competitive and fast changing, where customers and shareholders constantly demand more, and the conventional ways of marketing just don't work any more?

Track 1 Complexity

Explore the new challenges of market space and speed, and the fundamental shifts in
power.

Consider the vision of Google and focus of Apple, the rise of Starbucks and revolution of
eBay.

Learn to map emerging markets, to create rhythms that give you an edge, and to harness
customer power.

Track 2 Expectations

Understand the demands of customers and shareholders, and how to create superior economic value for both.

Learn from value disciplines of Microsoft and Toyota, and the strategic focus of Coca Cola.

Address these challenges through stakeholder mapping, and learn how to analyse the
drivers of economic and shareholder value.

Track 3 Genius

Explore what it means to be a genius, and how it applies to the world of marketing and
marketers.

Learn from the intelligence of Steve Jobs, the imagination of Philippe Starck, and the
extraordinary results of Phil Knight.

Consider and profile the attributes of genius, and how they can be applied to each aspect
of business and marketing.

Seize the best opportunities in your markets by thinking more strategically and innovatively,
combining the rigorous analysis and radical creativity that led to Albert Einstein's mind-bog-
gling discoveries, and Steve Jobs's market transformations

Track 4 Strategy

Embrace market strategies that give you the perspective and focus to create lasting competitive advantage.

Learn from the market-shaping strategies of Jet Blue and Sky TV, and the bold differentiation of Enterprise car rental.

Apply the ideas to your business through better market strategy and selection, portfolio
analysis and competitive positioning.

Track 5 Brands.

Explore what creates a great brand, how it lives and evolves, and how to maximize its power.

Learn from the brand thinking of Virgin, the passion of Pret A Manger, and the unrelenting
focus of BMW.

Develop your own brand strategy, with a clear architecture, brought to life inside and out,
to build long-term brand equity.

Marketing Book

2009-05-16T05:24:00.000+03:00

As We are talking about marketing by all types such as marketing strategies, brand marketing, marketing campaign, internet marketing, e-mail marketing, marketing on line ...etc

Today I'm going to start publish one of the greatest Books that i ever read and learned from & i hope to be useful for you.

The Book name is ''Marketing Genius'' for the Author "Peter Fisk " and we should know more about this guy.

Peter Fisk is an experienced strategist and marketer, and has worked with some of the world's
leading companies including Coca-Cola, Microsoft and Vodafone.

He joined British Airways, at a time when it was justifiably 'the world's favorite airline', after
early adventures in nuclear physics. He worked across sales and marketing - including chan-
nel development, relationship marketing and brand management - and was part of a strategy
team to address the challenges of globalization and low-cost entrants.

With PA Consulting Group, he led their global marketing consulting team, and worked with
companies from Silicon Valley to Singapore to develop more customer-centric businesses. This
ranged from innovation at American Express to market-shaping strategies for Shell, brand
repositioning for Courage and leadership development at BT helping Philips to become a cus-
tomer-driven business, and Microsoft to embrace value-based marketing.

As CEO of the Chartered Institute of Marketing, the world's largest marketing organization,
Peter championed professional standards and reputation, and encouraging business leaders to
embrace customers and brands as the most important source of long-term shareholder value.
This was supported by the launch of Knowledge Hub, an online learning product, a new journal
The Marketer, and the Shape the Agenda thought leadership program.

He now jointly leads a strategic innovation firm, The Foundation, helping companies to grow
their businesses from the outside in. By seeing the world as customers do, he helps business leaders to see things differently, and to develop the insights and strategies, belief and capabil-
ity, to do exceptional things. This has, for example, led to the refocusing of M&S retail proposi-
tion, and reengineering of Volkswagen's customer processes.

Peter is a recognized expert and commentator on marketing around the world. He is an inspi-
rational speaker on customers and brands, strategy and innovation. He is thoughtful and
considered, provocative and entertaining. He is co-author of the FT Handbook of Management,
and The Complete CEO. In January 2006, Business Strategy Review identified him as one of the
leading new business thinkers.

He combines youthful energy and inspiration with significant, practical experience. He is mar-
ried with two young daughters and, having grown up in the Northampton countryside, now
lives just outside London. He is a committed long-distance runner, Newcastle United supporter,
and never far from his Black Berry or I Pod.

Advise

2009-05-15T20:20:00.003+03:00

This is just an advice for the people who work in sales & marketing.

Dear Sales man,

Remember all the time the 4 K's rule that for my self I advise all of you to do it and you will see the difference that will happen and if you are already dong it just refresh your Style and you will get it.

1- Keep in Educational.
People love to know & learn so while you are doing your selling try to tell something new even if it's out of the point for a while.

2- Keep it Real.
don't give buyer so many of examples because you are talking about real thing so, you have to keep it real.

3- Keep it Entertaining.
people love to smile most of time no body love to be sad but you have to do it by the right natural way do not pretend it.

4- Keep it simple.
you know information right? so you understand your product buyer doesn't have to hear complex sentences but he wants to hear simple one & that's why you are doing what you are doing.

If you really know how to mix all of these you will get your goal while you are happy with out doing big effort.

see you in more advices.

Your Comments Means Alot

People buy What?

2009-05-15T19:55:00.003+03:00

I think after all what we said about people & what they need and when your product fit their needs I think we are now going to know that.

People Buy Feelings.

This is an extremely important point People do not buy the product so much for the thing it is,but for how it makes them feel.

What do people need?

Taking all of the above into consideration, I have drawn up a giant list of feelings,motivators and needs which typically make people buy.

Some of these are of course stronger drives than others - and some are really different ways to describe the same thing. Why not see if you can examine the products and services you offer and figure out which emotions and needs they appeal to -and how you can increase the quality of both your products and your marketing in line with these ideas.

You may find that some of the below will be "ultimate selling points" and essential functions of what you have to offer.

BEAUTY / ARTISTRY
SENSORY DELIGHT
LUXURY
RELEASE
LIFESTYLE
RELAXATION
INSTANT GRATIFICATION
ENTERTAINMENT
FUTURE WELFARE
FUTURE PROSPERITY
COMMON SENSE
FEELING SPECIAL
FEELING UNIQUE
FEELING IMPORTANT
FEELING CARED FOR
FEELING VALUED
FEELING APPRECIATED
CONVENIENCE / MAKING LIFE EASIER
SENSE OF BELONGING / SENSE OF COMMUNITY /
TOGETHERNESS
SENSE OF PURPOSE / MEANINGFULNESS / SHARED
UNDERSTANDING

I hope that you can find your start ASAP don't think so much & don't make any moves Just do it.

Happiness & People

2009-05-15T19:20:00.003+03:00

Of course there are, different forms and degrees for happiness. To a person who is starving, a plate of good food will bring enormous, though short lived, joy.

There are immediate needs such as this one, and there are more long term needs - such as to provide people with the physical, mental, emotional and spiritual tools they need for long term success and freedom.

The most successful businesses typically have a greater understanding of overall human needs, and are able to create and sell products and services which fit within the overall template of what is generally defined and socially accepted as a successful and full life.

And the stronger the focus on the customer and making them happy, the more popular and successful you will become.

The context of benefit to all

Throughout history, considerations of "what will be of greatest global benefit" have very often come second to considerations of immediate monetary profit This is in some ways understandable - as businesses have often had to be tough, and put themselves first, to survive. However, as the world's population grows and competition for resources becomes fiercer, such considerations as the global and long-term impact of our actions are becoming ever more important.

"Exploitation"has become a common theme -and it is becoming more desirable than ever before, for businesses to consider the ultimate effects of their works.

Again,the stronger your focus on fulfill ment of genuine human needs within the
context of the benefit of all,the better your reputation is likely to be.

The best businesses are those which grow wealthy by adding to the wealth of the world. This is true wealth - and it is ultimately measured not by meaningless strings of digital zeroes but by quality of life and of our surroundings. To take a hypothetical example: If you have a hundred billion dollars, but there is no air left to breathe- how rich are you? In the end,money is not the ultimate form of wealth.

The good news is that it really is possible to get rich and make the world a better
place at the same time...

Several needs at once

Often, the reasons that make people buy are complex. For example - going to the restaurant. We can think of multiple reasons why someone would go to a restaurant? any one of these might if taken on its own not be a reason to go there but when combined, give enough of a reason for someone to walk through the door and ask for a table:

Hunger
Desire not to have to cook
Sensory stimulation of rich,high quality or unusual food and drink
Beautiful,stylish or unusual surroundings
Relaxation
Desire to impress others
Feelings of social status and importance
Desire to been entertained
Desire to create an enjoyable time and space for conversation and relation ship

When all these considerations are combined, as they may be with a good restaurant, it can lead to a complete "experience" - and this is very often what
people are seeking.

Marketing & Sales vs Human needs 4 (manufacture of desire)

2009-05-14T07:33:00.000+03:00

The most insidious things which will harm them in the long run there are all kinds of fully legal products out there which cater, in varying degrees, to perceived or false desires and needs as opposed to actual ones Some of these products manipulate people's emotions and appeal to their cravings as opposed to those things which will bring true life improvement and lead towards long term happiness This subject is known as the manufacture of desire.

by catering to people's genuine needs, and taking a real interest in what will being them a better life, not only will we be more likely to develop quality products and services which are ultimately an easier sell, but we will develop that most important commodity for the long term success of a business reputation

In other words, by thinking about what supports, cares for, elevates and improves peoples' lives in real ways, and by catering to these needs, we have the greatest chance of developing a business that will be profitable in the long term.

This is called (The Principle of Service) and it is one of the master keys to
success.

You can apply this principle in your dealings with both your customers and your employees if you run our own business an employer who thinks about the long term prosperity and interests of their employees stands a greater chance of finding and keeping the best staff.

The principle also applies if are an employee of someone else by figuring out what makes your employer really happy you are far more likely to be able to serve their interests well, make yourself indispensable and therefore keep your job and have greater leverage when it comes to getting promotion.

This principle also applies to the kind of work that is done once and continues to bring revenue.

So the best modes operand of a business which is likely to make you extremely rich,is simple Figure out what makes people truly happy and sell it to them.

Marketing & Sales vs Human needs 3

2009-05-14T05:58:00.001+03:00

From our last paragraph in last article we should continue and you may refresh your Memo.

Now some, aware of his fact,have decided to target their entire product line and marketing effort at those with"desperate needs only"-and although this is quite likely to be an effective strategy for short-term profit, it doesn't necessarily always have the best interests of the consumer at heart and is not necessarily the best strategy for the development of a business with long term success.
we should explain more,..

Creating false or fake needs versus fulfilling true ones

and this is a very important point and it will be more effective with the successful sales guys because not so many people have the ability to do this trick as i can call it let see.

Sometimes people are clear about their needs. However, very often people have several needs or desires with in them, vying for attention at the same time! And there is sometimes a difference between what people think they need, and what . People often buy impulsively for many reasons and can often be convinced that they need things that, really, are not all that important.

And when people are desperate,they don't always make the clearest best decisions (Don't make a decision when you are angry & don't give promises when you are happy)

However,rather than attempting to create a demand for something which might ultimately not benefit people's lives very much, it is far better in every way to figure out what people's real or deep needs and desires are, and cater to them It is best both for sales and for a better world to have their best interests at heart.

This is why it is often said that the best sales people are those who seek solutions
for their clients,rather than just to shift products on to them.

Marketing & Sales vs Human needs 2

2009-05-13T04:53:00.003+03:00

As we said in the last article that ultimately, the key word in human buying behavior is not the word "want" but the word"need."

If we can provide what people need the most, and demonstrate effectively that our product or service will actually fulfill their needs, it stands to reason that they will buy from us. And the stronger the perceived or actual need for what

we have,the more readily they will spend their money.

The most immediate needs are those of survival such as food and shelter, Thus, over the course of time, people will spend many thousands of dollars on "food, houses, lawyers, doctors, vacation" all the things that may be required for survival, health and freedom.However, once these basic needs have been met, people

move on to the fulfillment of other needs and desires, and beg into think further into the future.

most immediate need at the bottom and those required for long-term or deeper emotional fulfill mental the top.

In times of poverty, it is much harder to sell a water color painting than a sack of rice.

Now some, aware of his fact,have decided to target their entire product line and marketing effort at those with"desperate needs only"-and although this is quite likely to be an effective srategy for short-term profit, it doesn't necessarily always have the best interests of the consumer at heart and is not necessarily the best strategy for the development of a business with long term success.

Marketing & Sales vs Human needs 1

2009-05-13T00:49:00.004+03:00

In this first part we will talk about one of point of view about Human Needs and Why they really want to buy & how you can sell your product or service to them, so focus and get ready to under people more.

Without a basic human need, there would not be a desire to purchase products or services. It is a
"need" or a state of desire that drives marketing. Humans have many needs: physical needs, food and clothing safety and social needs, shelter and a secure environment; the need to belong and feel loved and individual needs that revolve around self-esteem and self-actualization, meaning.

we need to achieve some sort of status, such as a reward on the job and or self-development
such as education. What is important to remember about needs is they are not created they are
part of who we are.

Wants describe the objects that will satisfy the needs. For example, two people are hungry. One
wants a hamburger the other wants Pizza Marketers respond to these wants, which are
triggered by needs, by providing a variety of products and services.

People want to be satisfied in different ways (hamburger vs. Pizza) and will choose what
products or services they buy based on their wants and resources. You are hungry (a need), you
desire Pizza (a want) but you can only afford a hamburger (demand).

What further complicates the process is that customers typically view products and services as a
'bundle of benefits' and choose those that give them best value (or bundle) for their money.

Why is this important for small business? Because marketing begins and ends with the customer,
you must understand what drives customers to buy products in order to understand how you can.

best communicate your offerings.

Target your Market

2009-05-11T19:41:00.001+03:00

Defining Products and Services

There are a multitude of choices for products in the marketplace. Products are generally thought
of as tangible objects, e.g. computer, furnace. But, products are not limited to physical objects.
Services, persons, places, organizations, activities and ideas are all "product" concepts. Basic
marketing concepts apply to all.

Determining your market and start to study it

You must determining your market and what you are going to sell there and make it as a target to you as your target must be the kind that who have a similar need for a product or service and have money to purchase it and ability to buy it (the willing). So market is BB.

Buyers: Individuals who buy or acquire products or services for personal use or consumption.

Businesses: Products and services purchased for use in the development of other products or services, or for the purpose of reselling or renting them to others with a profit.

selling

2009-05-11T19:25:00.001+03:00

Selling is as we can say is the Marketing Twin because both of them the main parts to increase business and if marketing is how to let people know your product or service so selling is how you make these users, consumers, or what ever buy your product or service so they are Twins as we said.
and to do this by the right way you must have good training stuff of sales men who really know how to sell product not tell people about it because there is a very big different between selling & telling
and before we know how we can sell we must know what makes people want to buy and if marketing by all of his types (normal marketing or e-marketing or I- marketing ... etc) fulfill peoples desires so selling is continue and arriving with people to their top of desire.

To be continue....

Mix marketing

2009-05-10T19:18:00.003+03:00

what is the Mix marketing or 4P’s Marketing or the 5p's?

most of people call it that way regarding to the following p's and i added one more p for them so let's see & follow with me.

Product

The product you are give it to consumer and they must know (description, Brand, benefits)
What you are going to give them? Why you selling this Item?

Place

Your target place that you are going to sell your product or service in.
Is it qualified to you?

Promotion

The different ways o make people know your product or service and start asking about it and you must answer
first.
Is it useful for them? Are they really needed? Is it fulfilling their desire?

Price

Must be fit people income to make good progress, especially if you are looking to make long, big business relation ship.
Does it fits their income?

Passion

Make them love your product as long as it’s useful for them then will come their passion for it.
Do you love your product? After answering this question you will know how to make them love it too.

get started

Meaning of marketing

2009-05-10T19:15:00.001+03:00

First of all before talking about how to do the right marketing we have to know what marketing is?
So many think of marketing as promotion, advertising or even sales. As they see advertisements in TV or newspaper, Radio, even Flyers. they view this as marketing. Others use the term in place of the word "sales." How often have you heard a company or individual say they are "selling" a product or service? But using the term in this way is only partially correct. Marketing is much more than simply promotion or selling.
A marketing approach to business begins with understanding you the customers and their desires and what they looking for, involves designing the entire company around fulfilling those desires, beginning with the product or service. Decisions that involve pricing, services, advertising and even sales are developed with the customer's desires and needs.
So, in Simple words Customer leads you to know how to start your marketing for your products or services.

And also remember as I can say about MARKETING.
M – Methods of develop your Product, service to consumer.
A – Any time any where.
R – Right way to start your successful selling.
K – Keep on touch with people & know all their desires.
E – Entertain them as you can.
T – Take always the lead of things (Think by there mind).
I – Investment your mind.
N – Note all small things.
G – Get your Goal.

Why Well Sell?

2009-05-04T03:18:00.007+03:00

The first thing came to my head after choosing my blog name that most of people will ask why this name well sell? ok.. well,

Simply the idea is through my experience in field of marketing, sales, export i tried very heard to make a good progress in those fields so it's a healthy thing to have your own point of view for what you do and that's why I told you in blog description Learn all ways and choose your way and that's what i did, of course there is a lot of people showed me how things going & read a lot of books BUT I'm always trying to find & walk in my own way and I'm Really thankful for every one teach me even a letter.

In this blog I'll try very hard to tell you every thing about marketing, sales, export and also some info. may be useful for you in your life not only career one.

So shall we start?