First written on August 11, 2009 Revised on Monday, December 21, 2009 Marketing, Sales, Service, Advertising, PR, Media and EMC - All articles are written by Madhavan Gopalachary. He is a Visiting Professor on Industrial and International Marketing for MBA students at a leading B-school in Chennai, TN, India. Why companies must have an Advertising Policy ? - Since both the client and the ad agency need each other, it is important that every client has an advertising policy which is discussed with the agency well before deciding to join hands and work together Advertising as a strategic variable - Majority of the companies treat advertising as a tactical variable. Ad expenses are considered as a revenue expenditure and not as an investment in the business. Advertising is not a tactical tool. It is a strategic variable based on which an organization can position itself or its brands. But any error in the positioning of the brand can be a costly mistake Biggest is not necessarily the best - it may be the worst - We have often stated that the biggest is not necessarily the best. We were wrong. It may turn out that the biggest are the worst. Let me explain what happened with me. I have a gold Visa credit card issued by one of the world's biggest banking corporations. From January 2007, they suddenly decided that all e payments will be accepted by them only after registrations at their site for security reasons. Good, nothing wrong with that Brand Differentiation - Whether the business is a bank or a small retailer, the brand development and strategy to a large extent dictates whether it will succeed or not in the long run When do brand or line extensions work? -  In marketing, brand extensions are not recommended and generally do not work in majority of the cases. However, there are some situations where they do work. After considerable research over the last five decades on brands by various experts, the following broad guidelines can be applied for brand extensions Brand Fight back - The Case of McDonalds - McDonalds became proactive and not reactive. Between 1998 to 2003, all its reactions were defensive and reactive trying to prove that its food was OK for the kids but Moms were not convinced. However, McDonalds came out with a solution Channel Management - Channel management is essentially a function of Sales Management and one of the crucial functions in implementing the company's overall marketing efforts. This has grown in importance and prominence and we have multi-channel arrangements in most companies. According to rough estimates, approximately 75 to 80 % of a company's products reach the customer/consumer through such channels as against 20 to 25% through direct sales Customer Complaints handling at McDonalds - There is no motivation to perform as temps and in such low paying jobs. Tips to waiters are generally low in fast food joints. Money at that level is very important. People are at the first level of Maslow's hierarchy of needs Customer focused brand management - In many large corporations, brands are sacrosanct. Managers responsible for the brands or divisions will protect their turf at all costs. Unfortunately, the focus is on the brand rather than the customers. The companies and their brand managers are trying to fix or reposition their brands all the time. Brands are important and are to be nurtured but at what costs? Defending against attack from competition - Every commercial organization is vulnerable and susceptible to attack by competitors. While the market leader gets attacked most from all quarters, smaller firms also get attacked. The attack comes in the following three forms Difference between consumer marketing and industrial marketing - The key difference between industrial and consumer markets is the much greater number of buyers in consumer or end markets. This means consumer marketers are by necessity more involved in polling type research to infer information about the population of consumers Divide, Conquer and Rule - In the article 'When do brand or line extensions work?', I had mentioned a few instances when line extension strategy can be applied successfully. However, in majority of the cases line extensions don't work Fundamental of Marketing - The FAB Principle - No one ever buys a product or service. They always buy what they think the product or service will do for them. Customers don’t buy products; they buy the value of products – the sum of benefits that products deliver. The same is true everywhere in business and in life Fallacies in Marketing - 1  - Marketing is an extremely interesting subject and to be successful in it you do not have to be necessarily from Harvard or Wharton or LSE or Lausanne or IIMs or IITs. All you need is common sense and get the basics and fundamentals right. We are giving below one such case study from real life, which highlights some of the common mistakes that are committed in Marketing Fallacies in Marketing - 2 - In our article "Fallacies in Marketing -1"  we had highlighted a marketing failure though nothing was wrong with the product as such. The problem was the product was not positioned in the mind of the customer and certain inbuilt doubts, prejudices and phobias of customer was not taken into consideration while the product was planned Flanking as a strategy in Marketing - In marketing, most are familiar with the defense and attacking strategies. However, many are not familiar with flanking. The reason is, it is more difficult, needs careful planning, daring, imagination and followed by quick consolidation of the gains. Direct attacks on a market leader very rarely succeed.  Throughout the human recorded history, we have never heard of anyone winning in such a scenario. They all won when they flanked the stronger opponent Guerilla strategy in Marketing - It is used against a larger, stronger and well entrenched opponent who cannot be attacked directly without great losses. Surprise, Speed and Stealth are essential prerequisites of a guerilla attack, just like in flanking. It is also industry specific. If you are in the automobile industry and if you want to take on Toyota in some market segment, you will need very much larger resources for launching a guerilla attack Advertising - Its impact on Marketing - In bad times, most organizations cut down on advertising expenses. In boom times they splurge. Advertisement budget need not be very large. Advertising expense should be considered as an investment. It has to be consistent. It has to be regular Implementation Problems in Industrial Market Segmentation - While segmentation principles are fairly common and well accepted in consumer marketing, using the term is a misnomer in industrial marketing. The term Target Market is used. However, the use of the term segmentation has crept in this field too and is fairly accepted but everyone may or may not understand its real limitations. The limitations manifest themselves in the form of problems while implementation Importance of Branding - Brand Strategy is either building a new brand or developing an existing brand. Branding is all about uniqueness of a product or service. The word branding is derived from the Old English, meaning a 'burning stick'. As early as 2700 BC, the Egyptians used livestock branding as a deterrent to theft Differentiating the men from the boys in business - Innovation & Marketing - What makes a company great and successful? What differentiates the winners, the also rans and the losers? What differentiates the men from the boys? Why do companies with equally good products fail to capitalize, while others succeed? It does not matter whether you are selling an ordinary soap or selling a hitech product or a service. It has nothing to do with great creative advertising and visuals. It has nothing to do with endorsements by celebrities Making Advertising Work - Advertising falls under one of the P's for Promotion in marketing theory. We have 3 promotional tools: Advertising which is impersonal presentation of information about a product or service, Personal Selling which is a personal presentation and lastly Sales Promotion, which is a catch all term for various devices used to attract the attention of a customer such as demonstrations, games, contests, trading stamps, scratch cards, free samples etc Market Research and its importance - While advertising as a glamorous sub function of marketing is quite popular, the crucial sub function of market research (MR) is often ignored. The successes of innovative products like 'Walkman' from Sony are very rare. Great entrepreneurs have instinctive judgment and may be able to get away without MR The Benefits of Knowing the Size of your Market - Many SMBs dealing with industrial markets do not know the size of their markets. I have received dazed looks from clients when asked the question. In the case of consumer products, it is generally possible to estimate the size of the market. As the markets are huge, any error in estimation does not affect the overall marketing strategy Marketing to Women - Understanding their Psychology - Logically, women should constitute 50% of the population all over the world. Agreed that in some countries the population ratio of men to women is slightly skewed either in favor of men or women. In Asian countries, women are less, whereas in African countries, the women are more. I do not know the latest position in European countries and USA to comment on this aspect but it can easily be gleaned from the internet by those interested Merchandizing - the much neglected sub function of Marketing - Way back in 1975, I bought a book titled 'Planned Marketing' written by Mr. Ralph Glasser, a British Management Consultant & Economist, at a railway station in India. The cover price was 35 pence and it was available at a special Indian price of five rupees at the A H Wheeler bookstalls you will find in almost all railway stations in India. In my opinion, the book is worth 35,000 pounds sterling Online Advertising - Internet has bred an amazing outlook in people that everything should be free. Internet is heavily loaded in favor of users and service providers like Google, eBay, Paypal etc., why is Yahoo languishing despite having the largest number of users? Pricing Methods - In the article for paying members titled ‘Pricing Objectives based on Market Environment’, we had given all details. In this page for free members, we will give the pricing methods that are available to all of us. To set the specific price level that achieves their pricing objectives, managers may make use of several pricing methods What is a product? - A product or service is any item, whether it can be carried, seen, experienced, worn or used to make something else - which costs something to provide at a given time, at a place and in certain quantities, which is designed to fulfill customer desires and for which people are willing to pay a price that makes it worthwhile for the producer to make and provide it - Ralph Glasser – British Management Consultant in Planned Marketing, Pan Piper Books, London, UK, 1968 The role of selling in industrial marketing - Selling is one of the functions of Marketing just as product planning, advertising, sales promotions etc., are. However, it is not as glamorous as other functions in spite of being one of the most difficult of jobs. Selling is the final link in a long chain of contacts an organization makes with its market What does differentiation really mean? - What does 'differentiation' mean? It means that a brand or product has to be different from the rest of the crowd and should have some unique appeal. We often confuse product differentiation with brand differentiation. Brands have to be differentiated from other brands in terms of perceptions. Products have to be differentiated by having some features, advantages and benefits over competition. Brand success is decided by its perceptions whereas a product success is decided by its performance alone What's in a brand name? - In business history, there are number of instances of products or brands doing well after the names were changed. As times change, some names tend to get out of date. However, some companies like Western Union have retained their old names and doing well. For some companies both the corporate and product brand names are the same but the problem is corporate branding suffers when one of its product brands fails in the market Why brands fail? - It was estimated nearly 5 decades ago, that 15 out of 16 products or brands fail. That is, only 1 brand out of 16 is a success. In terms of percentage it comes to 6.25%. In a globalized context and the highly competitive market that exists today, I estimate the success rate to be around 1 in 20 to 25. That is, it is around 4 to 5 % or even lower. Please note it is only an estimate and we have not done in any research on it The views, opinions and interpretations are personal. Sponsorship does not mean that the sponsors endorse them. © Copyright, Dec-09 . MMG Communications. Without prejudice. All rights reserved