Читать книгу Marketing Strategy In The Digital Age: Applying Kotler's Strategies To Digital Marketing - Milton Kotler - Страница 10

Every Generation Needs a New Revolution

About 5 years ago, I started to notice that when Philip Kotler gave lectures to senior executives from the Fortune Global 500 companies around the globe, he always showed two slides at the beginning and at the end: the first slide stated, “Market changes faster than Marketing,” while the second stated, “Within five years, if you’re in the same business you are in now, you’re going to be out of business.” These statements have been proven to be true after 5 years, as many enterprises, losing their competitive edges in the digital era, have been squeezed out of the profit zone. This is a time in which revolutionary marketing patterns have upgraded and overturned the original ones and in which players who used to lead the market have lost their edge and brilliance. Even P&G, the “King of Consumer Marketing” in the age of traditional marketing, is now lacking an innovation force.

It is a time of transition and revolution. In the discourse of Michael E. Porter, “competitive edge” seems to have become a theoretical mirage. Anxiety caused by the popular Internet keeps many entrepreneurs awake at night. With new concepts, theories and scientific applications such as the Internet+, social media, big data, community groups and VR popping up, we need to change our thinking pattern and have access to practical tools and weapons. In terms of digital transition, we have to think about what to change, where to change and how to change, and in terms of Internet+, what to add, what to subtract and how to calculate.

Always interested in the area of “competitive strategy,” I found that many factors could lead to a company falling behind or being replaced. It may be due to the fact that rivals have seized customer resources or that enterprises suffer from low operating efficiency; however, another factor, more critical and irreversible, is that a market “turning point” has occurred. And this reason can be subdivided into three scenarios — reshuffle among players, among industries and between different times. This time, with digital revolution, is the third type — reshuffle between different times; in other words, all your strategic methodology needs to be upgraded.

Associated with the occurrence of particular “problems” under a wider historical context, many management concepts have come into being to respond to puzzles in management practices based on a “problem-oriented” approach and are developed into theories to guide operations of the entrepreneurs. For example, management by objectives (MBO) is a concept suggested in 1954 by Peter F. Drucker against the background that US companies expanded rapidly, while managers lacked a sense of duty and Ford Motor Company was on the verge of bankruptcy. The concept of Strategic Management was proposed by Igor Ansoff, a Russian American and father of strategic management, who joined the Rand Foundation as a researcher after World War II. The term mainly discusses how US companies, faced with external shocks, have grown in order and achieved organizational synergy since 1970s. “Profit pattern” was first proposed by experts such as Adrian Slywotzky, but it was not before the end of the last century during the dot-com bubble that the concept became popular. At that time, every enterprise founder or CFO had to explain how they were going to make profits to their investors. In other words, the truly valuable theories at any time reflect contemporary problems, and the one that we are facing now is how enterprises are to realize Internet+ transformation in the digital era.

While many a book has been published on “Internet + transition”, none so far has discussed from the perspective of digital marketing strategy, which has been a demand of a large number of consulting clients — CEOs and CMOs — and that is the very reason that my partners and I wanted to write this book.

Digital Revolution, More of a Thinking Revolution

Redefining “digital marketing strategic methodology” seems to be a responsibility and a mission, which makes us ecstatic. A recent KMG survey targeted at CEOs and CMOs shows that 81% of the enterprises believe that digital marketing is the key to their digital transition; 68% of the enterprises claim that they have no systematic digital marketing strategies; more importantly, 58% of the enterprises claim that digital marketing performance has not achieved its due expectations. Just like what has been written in Good Strategy, Bad Strategy by Richard Rumelt, perhaps no one would deny not having strategies, but one’s strategies may not be good. When we spoke with the marketing decision-makers, we found that the core problem is a lack of strategic thinking or a lack of good strategic thinking. Digital marketing is definitely not the low-level combination or a simple composition of different tools such as WeChat, microblog, Facebook, demand-side platforms (DSP) and location-based services (LBS). In the field of human conflict, firearms have always been the “tools” of generals. The more critical is the “art of military” on the battlefield recognized at home and abroad, from The Art of War by Sun Tzu in the Spring and Autumn Period to On War by Carl von Clausewitz in Prussia.

From our consulting experience, CEOs, CMOs and other senior executives pondered over the following questions:

• How to combine digital marketing and the Internet+ strategy of the company? What role does digital marketing strategy play in the overall digital strategy?

• Does digital marketing strategy upgrade brands and channels or overturn the whole marketing model?

• Compared with traditional marketing, what has changed and what remains unchanged for digital marketing in strategies?

• How to combine marketing and data? In what aspects?

• How to build brands in the digital era? Any efficient ways to build “fast brands”?

• Is it necessary to build new marketing organizations? If yes, how?

• Digital marketing is known to be ROI traceable. How could senior executives measure the performance of digital marketing? …

Questions are the best nutrients. Based on questions faced by business executives and the experience and feedbacks we obtained from consulting cases, we have structured a way to upgrade the marketing strategy from systematic theories to practical tools in the digital era. First let us return to the essence of issues. We believe that, regardless of how marketing changes, three key points will always prevail, namely demand management, building differentiated value and building a basis for continuous trading. Whether we are in the traditional age or the digital era, these three factors remain the target of marketing strategies or market strategies.

After defining the unchanged, we then talk about changes or “the core of cores in changes”, the “essence of digitalized marketing” discussed in Chapter 2. People may use similar tools but come up with completely different results. In many cases, it is due to the fact that these digital tools have not been targeted at “essence”. We believe that the following five factors can be relied on to determine whether this marketing strategy truly realizes “digitalization”: connection, bit-consumer, data talking, engagement and dynamic improvement. Mobile Internet and the Internet of Things make an instant connection and continuous connection between people and people, people and products and people and information possible. This high connectivity produces traceable data paths, turns consumers into bits, demonstrates every link in marketing by data talking, realizes consumer engagement in connectivity and achieves dynamic improvement. All of these were unthinkable before the digital age.

With all these five factors pieced together, we can say that marketing in the digital age can truly realize synchronizing customer value management (SCVM). As a revolutionary marketing paradigm after CRM, the core concept of SCVM is to coordinate and organize all departments to realize close-loop value management and value-added management of customers based on customers’ full life cycle. In the digital age, because of scenario-based consumption activities, consolidation of various channels, integration of services and products, and real-time communication for brands, enterprises must integrate research and development (R&D), marketing, sales and service, driving sales and profits with customer value at the core.

Among these, all-round insight and full life cycle management of customers have become the key factors. Acquiring more premium clients, increasing customers’ share of wallet and improving customer lifetime value are specific ways of realizing performance growth. In the past, marketing decisions and data about customers were separately stored in different brand units, channel departments and regional marketing agencies, which means that enterprises lacked concentrated data management and all-round customer perspective. Therefore, they could not have had in-depth insight into customers, increased lifetime value of customers, expanded wallet share and achieved cross- and up-selling. Now, SCVM has addressed these marketing challenges: by setting up a CMO-led marketing organization of “customer value center” and by making use of marketing collaboration platforms and centralized data warehouses of customers, enterprises can manage and analyze scattered customer knowledge and data at the organization level, and all brands and channels, based on needs, can obtain and analyze data to support its marketing activities. The integration framework of SCVM is simplified as follows: customer data platform — digging business opportunities — contact management — insight engines — customized content — interaction and distribution — multimodal collaboration — marketing control board. In the SCVM marketing system, enterprises, in a centralized and flexible way, can identify and further explore customers’ value across departments, channels and brands.

From Changing Strategic Thinking to Implementing Them

Based on changed thinking, let us analyze how they can be implemented. My partners and I divide the implementation system into two levels: One is called the “digital marketing strategy mode and its implementation system” and the other is “digital marketing supporting system”.

In this first system, we discuss how to upgrade the previous marketing strategy, “STP+4P”. For example, production strategies have gone the co-creation way; price strategies have become dynamic and based on scenarios are free of charge; the boundary between physical and virtual channels has disappeared because of digitalization and the integration of multiple channels has become the key; placement strategies like brand value concept, real-time bidding (RTB), data management platforms (DMP) and DSP have sprung up. In the book, we discuss changes from more than 30 dimensions.

On this basis, we put forward the marketing implementation framework of the digitalized strategic platform, summarized as the 4Rs as follows:

• Recognize is the first step. In the pre-digital age, we talked about the overall analysis of target consumers by sample estimation and qualitative study. In the digital age, the biggest change lies in the capability of tracking network behaviors using big data, such as tracing cookies, tracing mobile digital behaviors using software development kits (SDK) and tracing shopping preferences by payment data. When these tracking results are connected, a user profile based on big data can be produced. The integration of these technological means and marketing thinking are the biggest change in the digital age. Here, we will introduce methods, cases and practices that are being followed in China.

• Reach is the second step, which is also a step shared by most enterprises who engage in digital marketing games. Approaches of reaching consumers have changed in the digital age, as there were no augmented reality (AR), virtual reality (VR), social media, applications, searching, intelligent recommendation, online-to-offline (O2O) commerce or DSP in the pre-digital age. How to reach consumers based on user profiles will be discussed at length in this section.

• Relationship is the third step. It should continue as a follow-up of Reach, because we found that with only the first two Rs, the efficacy of digital marketing cannot be guaranteed, due to the fact that these two only address the problem of targeting and reaching but leave the question of how to transfer client assets unanswered. The key is whether your digital marketing “sets up the basis of continuous trading.” Many community groups can ensure that enterprises have direct in-depth connection, interaction and engagement with clients in the scenario of “disintermediation.” This is also the currently proposed Enterprise 2.0 and “Marketing 4.0: helping clients with self-fulfillment” pointed out by Philip Kotler during the Tokyo conference.

• Return is the fourth and last step. It addresses the question that “marketing is not only an investment but also yields direct returns.” Many enterprises have set up communities and attracted brand fans, but how to cash in on these resources is the issue to be addressed in this chapter. We propose many operational frameworks to cash in on client assets like commercializing community membership and community values, media coverage of community interests, channelizing community members and marketing community trust.

The above 4Rs form a cycle of operation which is good for CEOs and CMOs to understand, apply, implement and give feedback. On the basis of the 4Rs, we discuss the supporting system of digital marketing in Chapter 3. We believe that digital marketing should embrace data, embrace big data and apply big data to make marketing decisions. For example, for real estate and retailing, consumers’ offline behaviors can be tracked by SDK; what apps have been downloaded in clients’ cell phones can be known by SDK; users can be profiled by modeling and machine learning. Media channels were purchased in the past, but now, thanks to disintermediation, they can be independently set up and launched by a person. Therefore, “content” becomes unprecedentedly important, and “content marketing” becomes another hot topic. We say in China that “a good content editor equals 1,000 salespersons”. Therefore, we would discuss how to undertake “content marketing” in this chapter. Additionally, “disintermediation” and “decentralization” make organizations change. Platform organization and starfish organizations start to emerge. How to adapt to the strategic and organizational changes at the company level and how to maintain resilience and keep “unified will” are discussed in Chapter 9. Last but not least, all marketing investment cannot be made without key performance indicators (KPI) or return on investment (ROI). How to measure and evaluate these components has been an issue. The digital era turns “consumer behaviors into bits”. The dimensions that could not be measured in the past can now be measured. However, evaluation has to be coordinated with strategy, which is discussed in Chapter 10 of this book.