Why do companies without a marketing plan still succeed?

Question:  We sell branded imported construction materials.  This year is our 7th year in this business.  We opened during a recession year and even then we met our revenue quota and were a little above breakeven.  Last year, we did very well.  At the very start, we had no marketing plan.  We did not even have a selling plan and that’s true even now.

What we have at the start of the year is a list of client accounts, both existing and new.  We’re seven partners and each of us has 10 to 12 accounts to go after every month with sales and personal activities that include golfing and night outs and parties.  And that’s how we’re making money.

Last year, the son of one of our partners with his two classmates wanted to do a “thesis” on the company’s marketing plan.  We told the student group that we had no such plan on which to base their thesis on.  So we referred them to another company whom one of us knew.  In our weekly meetings, we actually often ask ourselves the same question posed by those students: “How can you be successful without a marketing and a sales plan?”

We jokingly say to one another: “Because we’re good and obviously we don’t need one to meet sales quota and make a profit.”  But every so often, one or two of the partners would go back to that question.  We know you often tell those writing to you that you should have some details to give a good diagnosis.  But you also often answer questions without much background details.  Would you do that with the question to which we can’t give a good answer?

Answer: There are two ideas you should think about to provide a good answer to your question or the question that the students asked.

The first of these is about your assumption that a marketing plan or a sales plan must be written to count as a plan.  But in your weekly partnership meetings, you set revenue and profit objectives.  Then each partner has a set of revenue and sales generating activities to undertake.  Those activities are meant for each partner’s assigned 10 to 12 client accounts who are your sources of making money for the company.  Those two components, objectives and the means to attain the objectives, define a marketing and a sales plan.

So you have a plan and I think it’s also a written plan.  If you keep minutes of your weekly meeting, those objectives and scheduled activities to attain the objectives, are the written drafts of your plan.  All you have to do is to convert the pertinent portions of those minutes into your written and formal marketing and sales plan.

I would even say that your “virtual” plan has a business model for attaining its objectives.  It’s the simplest of all business model: the “Income Statement Model.”  The top-line revenue and bottom-line profit are your plan’s objectives.  The mid-line cost and expenses define the resources and activities you have lined up and scheduled for attaining the objectives.  So please stop saying that you don’t have a marketing and a sales plan.  You have, but what you need to do is to translate your virtual plan into a written formal plan.

Let’s now take up the second and more consequential consideration for attaining marketing success.  This relates to the question of what makes a plan, virtual or written, succeed?

The history of successful and unsuccessful marketing and sales plans tells us that the question asked is the wrong question.  Good planning is not enough.  If no one will put the plan in place, then nothing will happen.  The plan succeeds when it’s implemented point by point and in its entirety.  So the right question is: “How do planning and implementing lead to success?”

In the early 90s, we had a Korean MBA student who became a marketing director at Kia after graduating.  A year later, he came to the alumni reunion and talked to us about the marketing planning and brand positioning at Kia.  Someone in the table asked our Korean guest what made Koreans so good in their marketing and positioning.  Here’s what he said: “Our marketing plan and positioning are what we find in your book.  We actually copy.  Then we execute everything to the letter with practically no questions asked.  We just make sure that we have the right manager for a project, a campaign and an activity.  And good results are rewarded.  We give generous rewards.  Bad results are not penalized especially if what happened is outside the manager’s control.  We retrain but not in a group but individually.”

Korean companies like Kia and Hyundai, and Japanese companies like Sony and Toyota, all say that marketing success comes from only 10 percent to 20 percent good planning but 80 percent to 90 percent of the success comes from stick-to-it implementing.  What matters more therefore are the doers.

In fact, what our Korean host said was worth noting: “My Filipino MBA classmates were all terrific planners.  In my group I always ranked last.  But when I come for our alumni reunion and we compare notes, they all debate endlessly.  I talked more about what I’ve done and am doing.  That’s your weakness here.  Implementation.”

This generalization has no universal truth in it.  But even if it’s half true, it’s still worth considering.  What we should next talk some more about is the right kind of implementation.  But our MRx column doesn’t have enough space for that.  Another MRx column should take this up. Keep your questions coming.  Send them to me at [email protected].