Kotler's strategic perspective on the new marketing

Citation

Henry, C. (2002), "Kotler's strategic perspective on the new marketing", Strategy & Leadership, Vol. 30 No. 4. https://doi.org/10.1108/sl.2002.26130dae.001

Kotler's strategic perspective on the new marketing

Craig Henry

Marketing Moves: A New Approach to Profits, Growth, and Renewal

Philip Kotler, Dipak C. Jain and Suvit MaesinceeHarvard Business School PressBoston, MA2002208 pages$29.95

In the days when Internet hype was accepted as gospel, a flood of books advised marketers how to succeed in the new era. Their flamboyant and exuberant proclamations about the new media, which seemed plausible and visionary in the heady days of 1999, now seem stale, deflated, and passé. However, there is no disputing that both marketers and planners have to contend with real changes in how marketing is done as a consequence of the Internet and other digital technologies. What we have been waiting for is a critical guide that can help us make sense of where we are now and where we are going.

Marketing Moves: A New Approach to Profits, Growth, and Renewal provides the broad conceptual insight that has been lacking in the avalanche of recent books about the attention economy, viral marketing, experience marketing, and customer relationship marketing. This brief guide by a team headed by Kotler, one of the most respected scholars on all things marketing, reflects his deep knowledge as well as his co-authors' extensive, serious research into new technology, business models and competitive strategy.

Kotler and his co-authors have produced a work that concentrates on the lasting impact of digital technologies on marketing. They are not uncritical boosters of the Internet like other authors who proclaim that it "changes everything." To the contrary, this book warns, "Companies need to retain most of the skills and competencies that made them successful in the past. But if they hope to grow and prosper in today's economy, they will need to develop major new understandings and competencies."

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  "Markets are changing faster than our marketing. The classic marketing model needs to be future-fitted. Marketing must be deconstructed, redefined and stretched. Marketing is not going to work, if its only charge is to pump up sales of existing goods."

At the heart of their thinking about the new economy are a few key facts. First, buyers have been empowered by the digital revolution: they have more products being offered to them, more suppliers competing to sell those products, and more information on which to base their purchase decisions. Second, products are rapidly commoditized due to the rapid diffusion of knowledge and the existence of well-developed supplier networks. Finally, the new technologies permit companies to engage in widespread two-way communication with their customers and create new products with this information.

These changes, the authors argue, require that companies move away from the "marketing concept" and toward an idea they call the "holistic marketing framework." This means, in a nutshell, that success requires a restructuring of the business "from a customer-driven starting-point, so they gather deep knowledge about customers and then have the capacity to offer customized products, services, programs, and messages."

Thus far the book's ideas are hardly revolutionary. Or, perhaps, it is better to say that they resemble the revolutionary prescriptions of 100 books that have appeared in the last five years. But Marketing Moves makes its contribution by treating the holistic marketing concept as a "framework" not a panacea. Instead of prophecy and apocalyptic warnings, the authors bring rigorous analysis to bear on the challenge of marketing.

Their framework begins with the three actors in the marketing equation (customers, company, and collaborators) and the three critical activities that yield business success (value exploration, value creation, and value delivery). A company, in this schema, has a process for managing each actor. Thus "demand management" is a process focused on customers, while network management is directed at external collaborators. The interaction of activities and processes creates the nine building-blocks of the framework. For example, customer relationship management is the value delivery activity that is part of the demand management process. The nine blocks, in turn, are grouped into four "competitive platforms" – marketing activities, market offerings, business architecture, and operational systems. These platforms then are used in establishing business strategies.

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  "The new economy is not only about dot-coms. It is about something more fundamental: the emergence of a network economy."

Clearly, this is a careful, systematic approach to the new economy that is close to unique. The authors discuss and analyze each building-block and platform. While their examination is not exhaustive, it is of sufficient length and depth to be informative and thought-provoking.

Given the breadth of the framework, the book is as useful for strategic planning as for marketing operations. As a strategic text it is superb because it offers a systematic schema that places customer value at the heart of its thinking.

Beyond its systematic approach, Marketing Moves also displays clear-sightedness about the economics realities that remain despite technological advances. Thus, while the authors see customization as a strategic imperative, they recognize that it entails risks. As they put it, "If it is easy to imitate, competitors will enter a vicious circle of increasing investments from which, ultimately, only consumers benefit. The second [risk] is that, if the product is not designed carefully and the dissatisfied customer returns it, the company is then stuck with an idiosyncratic product that no other customer may want." Such nuanced and balanced analysis is found throughout the book.

This is a short book that repays re-reading. Every marketer and strategic planner will find much in it that is of high value.