‘What should marketing be responsible for?’
Q: In this ,edium-sized local pharma company that I joined just two and a half years ago, Marketing, where I am now the director, is made responsible for only the planning of the product sampling. We have year-round product sampling to doctors (for our prescription products) and to buying consumers in the drugstores (for our OTC products).
I actually did not mind this Marketing set-up because I was recruited from a larger local pharma company where Marketing responsibility was also confined to product sampling. But last year, as part of the company’s executive incentives, this company where I’m now working enrolled me in a distance learning MBA. It is from this MBA where I learned that marketing is and should be in charge of “all the 4 Ps” although for Sales, for example, not “directly but in close partnership” with marketing and from whom Sales also take directions.
Will you please clarify us on this issue? Is it because our Marketing is not properly organized that we’re having a hard time meeting our revenue targets even though we’ve never failed to meet them? How can we transform from a product-sampling marketing to a 4-P marketing?
A: When it comes to marketing organization, there is no structure that is the best or better than another for marketing success. For example, the leading FMCG (fast moving consumer goods) companies like Unilever, P&G, and Colgate-Palmolive conduct their business along a 4-P marketing set-up. But most large local FMCG companies started in late ’70s and early ’80s as sales-driven organizations or 1-P marketing organization. Your own pharma company is a case in point for this 1-P marketing set-up with its concentration on product sampling as sole marketing responsibility.
During those two decades, commercial banks were basically in 2-P marketing. They sourced savings funds from the provinces, and then brought those funds to the urban centers or Metro Manila (or the placement P). Here they made those funds available as commercial loans at higher interest rates than what they pay for them as deposits in the provinces (or the pricing P).
Marketing history recorded and reported that for the most part, all three marketing organizations succeeded in their revenue generating goals. This reality does not say that marketing organization has no influence on marketing success. What it tells us is that marketing success comes from many other forces that are over and above marketing organization.
But all those other forces and variables like the 4 Ps, for example, work their contribution to marketing success through people and people are the organization. The Japanese industrialist and founder of Matsushita Electric, Konosuke Matsushita, tells us that marketing success, at least in the case of his National and Panasonic brands, was “10 percent good planning and 90 percent flawless, stick-to-it implementation.”
People in any company have their “ways of doing things,” which is known as the “culture” of the organization. So there is such a thing as an organization’s planning culture. This is basically the way people in the organization do the right things in contrast to doing things right which is about the organization’s implementing culture or about efficiency.
Under Matsushita’s formula, what happens inside the organization or its dynamics is largely a matter of implementation. This is an ongoing process and a 24/7 affair. In contrast, planning is periodic, say, once a month, every quarter, semester or yearly. So in your specific case, a 1 P marketing or product sampling driven marketing, your marketing organization concerns should be about the answers and solutions to these questions:
“Who are responsible for executing your product sampling plan?”
“What specifically about product sampling implementation are they responsible for?”
“What efficiency indicators and norms are in place and who is doing the monitoring?”
“To whom is the monitoring report submitted and how does this recipient process the report and act on its implementing implications?”
“Are good executions acknowledged and rewarded and what kind?”
“Are flawed implementation performance brought to the attention of the person/s concerned and measures for the correction and/or the retraining needed taken?”
As to your last question relating to how you can transform from a product-sampling marketing to a 4-P marketing set-up, we suggest that you should first be aware if the wear-out of your 1-P marketing has started to take place or has already taken place. If revenue, for example, has plateaued for 3 to 6 consecutive months and show signs of a downward trend, then it’s most likely that wear-out has started. Of course, this topic of organizational transformation deserves its own space and column. We’ll take it up in another Friday Marketing Rx column.
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