Marketing for CEOs - Simple in principle - Difficult in practice

by Robert M. Donnelly

Two management philosophers, Peter Drucker and Jim Collins, have given us some simple thoughts to ponder:

Drucker - A business is created to capture, grow and please customers. The difference between one business and another is the team.

Collins - To win we need to (1) get the right people on the bus, (2) get the wrong people off the bus, and, (3) get the right people in the right seats.
From "Good to Great"

I agree, but there is also another element to consider which is the difference between Marketing and Management. We have just witnessed another episode in the automobile market that has resulted in the flushing of some good, and not so good, car brands down the toilet. And, more are yet to come.

It's a classic example of the difference between perception (marketing) and reality (management). Marketing is about perception, and using cars as an example - the quality of the car is not the question - the perception of the manufacturer is.

In any market quality is whatever the customer thinks it is, and what's in the minds of customers may or may not correspond with reality. 

Management typically concentrates on the product, whereas Marketing concentrates on the brand. A product is made in a factory, but a brand exists in the mind.

Management focuses on short term profitability. Marketing focuses on long term brand positioning in the mind of customers. Often, management becomes inwardly focused concentrating on building products more efficiently at lower costs. Their more marketing oriented competitors on the other hand are working to develop more customized products for customers' changing requirements.

Another example is the Dell/Apple situation. While Dell worked to figure out how to offer a lower cost PC/Laptop alternative and the return to retail outlets, Apple leap-frogged them with cooler more user friendly Apple stores with genius bars, and more expensive, more sophisticated iMac's and related "i" devices.

Today, Apple is "hot" and Dell is dull. Is there anything wrong with Dell's products? No, they work, but they are not perceived as hip and cool. Is there anything wrong with Chrysler's new cars? No, they work, too; but who wants a Chrysler when you can buy a neat new stylish Hyundai, or a Nissan, or even now the new Kia?

How about a Ford, or a neat new Cadillac, or a Chevy Malibu or Camaro? And look at how fast Toyota's image has been tarnished.

In conclusion, as the CEO - where are your priorities? Making more products or owning more customers? Another thought to ponder:

Are you in the customer business, or the product business?

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Bob Donnelly is the Editor of the online Entrepreneurial CEO column for Chief Executive Magazine. His column is broadcast monthly to thousands of CEO's across the U.S. and read by many more globally.

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