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January 18 - January 23, 2020
McCarthy’s four Ps concisely explained the generic practices of product management in those days: develop a product , determine the price, do the promotion, and set up the place of distribution.
More Ps—people, process, physical evidence, public opinion, and political power—joined the original four Ps.2 However, the classic model of Marketing 1.0 remained tactical in nature.
Marketers realized that to effectively generate demand, “customer” should replace “product” at the heart of all marketing activities. The customer management discipline, including strategies such as segmentation, targeting, and positioning (STP), was introduced. At this point, marketing was no longer only tactical.
To generate demand, it was no longer enough to target the customer’s mind with the classic positioning model. It was necessary to target the customer’s heart as well.
Figure 2.1 The Evolution of Marketing Concepts
THE FUTURE OF MARKETING: HORIZONTAL NOT VERTICAL
Today, trust exists more in horizontal relationships than in vertical relationships. Consumers believe one another more than they believe in companies.
Marketing is considered the same as selling, using the art of persuasion, and even some manipulation.
Everyone is both marketer and consumer. Marketing is not just something marketers do to consumers. Consumers are marketing to other consumers as well.
Table 2.1 The Future of Marketing The Disciplines of Marketing Today’s Marketing Concept Future Marketing Concept Product Management The Four Ps (product, price, place, promotion) Cocreation Customer Management STP (segmentation, targeting, and positioning) Communitization Brand Management Brand building Character building
First, companies should create what we call a “platform,” which is a generic product that can be customized further. Secondly, let individual consumers within a network customize the platform to match their own unique identities. Finally, ask for consumer feedback and enrich the platform by incorporating all the customization efforts made by the network of consumers.
The concept of communitization is closely related to the concept of tribalism in marketing. In Tribes, Seth Godin argued that consumers want to be connected to other consumers not to companies.7
Consumers in pools share the same values although they do not necessarily interact with one another. The only thing keeping them together is their belief and strong affiliation to a brand. This type of community is a typical group of brand enthusiasts that many companies should nurture. Consumers in webs, on the other hand, interact with one another. This is a typical social media community where the bond is rooted in one-to-one relationships among the members. Consumers in hubs are different. They gravitate around a strong figure and create a loyal fan base. The classification of community is
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Brands with unique DNAs will have their characters built up throughout their lives. Achieving differentiation is already hard for marketers. Achieving authentic differentiation is even harder.
SHIFT TO HUMAN SPIRIT: THE 3i MODEL
According to Stephen Covey, a whole human has four basic components: a physical body, a mind capable of independent thought and analysis, a heart that can feel emotion, and a spirit—your soul or philosophical center.
In 3.0, marketing should be redefined as a consonant triangle of brand, positioning, and differentiation. 13 To complete the triangle, we introduce the 3i: brand identity, brand integrity, and brand image.
Differentiation is the brand’s DNA that reflects the true integrity of the brand. It is a solid proof that a brand is delivering what it promises. It is essentially about delivering the promised performance and satisfaction to your customers. Differentiation that is synergetic to the positioning will automatically create a good brand image.
Figure 2.2 The 3i Model
Brand identity is about positioning your brand in the minds of the consumers.
brand integrity is about fulfilling what is claimed through the positioning and differentiation of the brand.
brand image is about acquiring a strong share of the consumer’s emotions.
Figure 2.3 The 3i of S.C. Johnson
Figure 2.4 The 3i of Timberland
In social media, a brand is like a member. The brand identity (that is, your avatar) is rated by accumulation of experience within the community.
Marketing 3.0 is the era of horizontal communication where vertical control will not work. Only honesty, originality, and authenticity will.
SHIFT TO VALUES-DRIVEN MARKETING
Drucker argued that successful businesses do not start their planning with financial returns. They start with the performance of their mission. Financial returns will come as results.
Therefore, we prefer to define a mission in more enduring terms as your company’s reason for being; it reflects the company’s basic purpose for existence. A company should characterize its mission as fundamentally as possible, as it will determine the sustainability of the company.
The doughnut principle basically says that life is like an inverted doughnut, in which the hole is on the outside and the dough is in the middle. In the doughnut view of life, the core is fixed and the bounded space around the core is flexible. The company’s mission is the core that cannot be changed. The operations and business scope of the company are flexible but should be aligned with the core.
Vision can be defined as a picture of the desirable future state of the company.
Values articulate a set of corporate priorities and management attempts to embed them in its practices, which it hopes will reinforce behaviors that benefit the company and communities inside and outside the firm, and which in turn strengthen the institution’s values.
It must not only promise ProfitAbility and ReturnAbility to current and future shareholders, but also SustainAbility.
Figure 2.5 Values-Based Matrix (VBM) Model
Figure 2.6 Values-Based Matrix of S.C. Johnson
Figure 2.7 Values-Based Matrix of Timberland
MARKETING 3.0: THE MEANING OF MARKETING AND THE MARKETING OF MEANING
PART II STRATEGY CHAPTER THREE Marketing the Mission to the Consumers CONSUMERS ARE THE NEW BRAND OWNERS!
When a brand’s mission is successfully implanted in consumers’ minds, hearts, and spirits, the brand is owned by the consumers. The real mistake both companies made was that they did not understand their own brand mission as well as their consumers did.
GOOD MISSION DEFINED
Figure 3.1 Three Characteristics of a Good Mission
Business as Unusual
Table 3.1 Examples of Business as Unusual Practices and Brand Missions of Visionary Leaders
Businesses should start from a good mission.7 Financial results come second.
Next, a good mission is always about change, transformation, and making a difference.
Story that Moves People
Robert McKee, a famous screenwriter, believes that there are two distinct ways to convince people.14 The first one is to base your ideas on a set of facts and numbers and engage people in intellectual arguments. An alternative, which he thinks is much more effective, is to write compelling stories around the ideas and engage with people’s emotions instead.
He always begins with a story. After the story is delivered, Jobs will then speak about the features and the set of facts regarding the product.
In Made to Stick, Chip and Dan Heath offer three types of good story plots: challenge, connection, and creativity.
The story of David and Goliath is a classic example of a challenge plot. In this type of plot, a brand plays the role of a weaker protagonist that takes on the challenge against a stronger opponent or difficult obstacle.
