“The Bagwan Marketing insights from every manager needs to know_7

166 Marketing Insights from A to Z A Hong Kong shoe manufacturer wondered whether a market existed for his shoes on a remote South Pacific island. He sent an order taker to the island who, upon a cursory examination, wired back: “The people here do not wear shoes. There is no market.” Not convinced, the Hong Kong manufacturer sent a salesperson to the island. This salesperson wired back: “The people here don’t wear shoes. There is a tremendous market.” Afraid that this salesrep was being carried away by the sight of so many shoeless feet, the manufacturer sent a third per-son, a marketer. This marketing professional interviewed the tribal chief and several natives and wired back: “The people here don’t wear shoes. As a result their feet are sore and bruised. I have shown the chief how shoes would help his people avoid foot problems. He is enthusiastic. He es-timates the 70 percent of his people will buy the shoes at $10 a pair. We probably can sell 5,000 pairs of shoes in the first year. Our cost of bringing the shoes to the island and setting up dis-tribution would amount to $6 a pair. We will clear $20,000 in the first year, which, given our investment, will give us a rate of re-turn on our investment (ROI) of 20 percent, which exceeds our normal ROI of 15 percent. This is not to mention the high value of our future earnings by entering this market. I recommend that we go ahead.” This illustrates that effective marketing involves careful research into the market opportunity and the preparation of financial esti-mates based on the proposed strategy indicating whether the returns would meet or exceed the company’s financial objectives. In the past, a gifted salesperson was one who could “commu- Service 167 nicate value.” But as products have become more similar, each competitive salesperson delivers essentially the same message. So the new need is for the salesperson who can “create value” by helping the customer make or save more money. Salespeople must move from persuading to consulting. This can take the form of providing technical help, solving a difficult problem for the cus-tomer, or even helping the customer change its whole way of do-ing business. ervice In an age of increasing product commoditization, service quality is one of the most promising sources of differentiation and distinc-tion. Giving good service is the essence of practicing a customer orientation. Yet many companies view service as a pain, a cost, as something to minimize. Companies rarely make it easy for customers to make inquiries, submit suggestions, or lodge complaints. They see provid-ing service as a duty and an overhead, not as an opportunity and a marketing tool. Every business is a service business. You are not a chemical company. You are a chemical services business. Theodore Levitt said: “There is no such things as service industries. There are 168 Marketing Insights from A to Z only industries whose service components are greater or less than those of other industries. Everybody is in service.” “Businesses planned for service are apt to succeed; busi-nesses planned for profit are apt to fail,” observed American edu-cator Nicholas Murray Butler. What service level should a company deliver? Good service is not enough. Nobody talks about good service. Sam Walton, founder of Wal-Mart, set a higher goal: “Our goal as a company is to have customer service that is not just the best, but leg-endary.” The three Fs of service marketing are be fast, flexible, and friendly. What is poor service? There are stories that tell of a hotel in Spain that advertises that it will accept service complaints at the front desk only from 9 to 11 A.M. each day. And there is a store in England whose sign reads, “We offer quality, service, and low price. Choose any two.” There are two ways to get a service reputation: One is to be the best at service; the other is to be the worst at service. Ellsworth Statler, who founded the Statler hotels, trained his people with the dictum: “In all minor discussions between Statler employees and Statler guests, the employee is dead wrong.” You can check on the service quality of your organization by be-coming a customer for a day. Phone your company as if you are a customer and put some questions to the employee. Go into one of your stores and try to buy your product. Call about returning a prod-uct or complaining about it and see how the employee handles it. You are bound to be disappointed. Check the smile index of your employees. Remember, “A smile is the shortest distance between two people.” (Victor Borge) ponsorship Companies are constantly invited by various groups to sponsor events, activities, and worthwhile causes. Companies also actively seek venues where they can get their names before the public. For ex-ample, Coca-Cola has been a long-term participating sponsor of Olympic Games, World Cups, Super Bowls, and Academy Awards. By shelling out large sums of money, Coca-Cola hopes to gain favor-able public attention and also treat its associates to big-time events. Companies will put out good money to place their names on physical facilities such as buildings, universities, and stadiums to keep their names in the public’s eye. Sometimes this backfires; Houston had to find a new name for Enron Field. Companies can sponsor an important cause (such as better eat-ing, more exercise, regular doctor appointments, saying no to drugs) in what is called “cause-related marketing.” By partnering with a cause that many people believe in, the company can enhance its cor-porate reputation, raise brand awareness, increase customer loyalty, build sales, and increase favorable press coverage.55 Companies are increasingly borrowing the auras of celebrities to add radiance to their own names. Celebrities bring high attention to the brand, add to its credibility, and offer reassurance. Not surprisingly, 169 170 Marketing Insights from A to Z singers, actors, and sports figures stand ready to sell their auras. Reebok has acquired the aura of Venus Williams ($40 million contract) and Nike has acquired Tiger Woods’ aura ($100 million contract). But be careful. PepsiCo borrowed the auras of Michael Jackson, Mike Tyson, and Madonna, all of which backfired. And Hertz bor-rowed O. J. Simpson’s aura, only to regret it. Sponsorship can turn out to be either an expense or an invest-ment. If the money doesn’t generate increased sales or corporate eq-uity, then it is an expense. Companies that want to make the expenditure an investment have to be much more careful in deciding what to sponsor. The question is what does a company gain from putting its name on a stadium, a Formula One racing car, a golf tournament, or an art show? Does it help the company sell more stuff? Most companies haven’t really thought through their sponsorships. In fact, they often start a sponsorship that they continue indefinitely because of inertia or from their fear of being criticized for dropping the sponsorship. If your company is going to sponsor something, make sure that it is a reasonable and relevant match to your target market and type of product/service. A good example is Timex’s sponsorship of the Ironman Triathlon to convey that its watches “take a licking and keep on ticking.” On the other hand, it wouldn’t make sense for Nestlé’s baby food division to sponsor a nursing home event. Make sure that you decide on the objectives you are trying to achieve with the sponsorship. The money must have a positive impact on awareness, image, or customer loyalty that somehow turns into more sales. Ask how much your sales will have to increase to justify the cost. After each sponsorship, do a postaudit of whether it achieves the objectives. Granted, it is difficult to measure the value a company receives from many of its sponsorship dollars. If you find that it didn’t contribute much value, write it off as philanthropy.56 ... - tailieumienphi.vn