What does the future hold for marketing? I suggest the perception of marketing has fundamentally changed over the past twenty years and that is not good news for the marketing profession.
That said, this is not a marketing is dead post, far from it. Marketing, when properly defined, is just as important to company profitability as it ever was. I argue the functions of marketing will not disappear but the future of marketing as a profession looks bleak.
Marketing has struggled to define itself. It has failed to gain control of the buttons it must press to make a difference. Crucially it has failed to persuade corporate management it delivers value and is deserving of the support it needs.
Perhaps the ambition of defining strategy and managing the 4P’s was too much. There is some hope but before considering the future of marketing, it is important to understand how we reached this point.
Marketing – A Brief History
Let’s start at the beginning. When did marketing as a profession first emerge as a discrete discipline? Strategy is one key element of marketing with its origins in military strategy. We know the military strategy timeline goes back at least 2,500 years to the time of Sun Tzu.
Salesmanship is not marketing but it certainly predates military strategy. Advertising can be traced back to the mid- 1600s with the invention of the printing press.
Proctor and Gamble started selling Ivory Soap in 1879. Many suggest this was the first branded product but again branding alone is not marketing.
So we reach the 1900s. I suggest marketing was defined as a discrete business discipline in the mid-1950s with the publication of the works of Wroe Alderson. Some may claim that Neil Borden (1922-1962) who coined the term marketing mix was the father of marketing. Or, it could be Igor Ansoff (1918-2002) or E.J. McCarthy (1928-2015) but we would be arguing about semantics.
The first real giants of modern marketing such as Philip Kotler started to emerge in the late 1960s and marketing has evolved from that point on. Marketing as a discipline has emerged relatively recently. It could disappear as a discrete discipline just as rapidly.
What Is Marketing?
What is the purpose of marketing? There are many definitions of marketing and that’s part of the problem. Taking a sample from marketers I admire. All have been in the marketing trenches for decades.
Philip Kotler (From Marketing Management). – ‘The art of identifying and understanding customer needs and coming up with solutions that satisfy customers and produce profit for the stakeholders’
Jagdish Seth (From The 4A’s of Marketing), – ‘The arts of understanding, informing, influencing and persuading – to align all aspects of the organisation around a set of common customer centred goals.’
Malcolm McDonald – (From Marketing Value Metrics). – ‘Marketing is a process for defining markets quantifying the needs of the customer groups (segments) within these markets; determining the value propositions to meet these needs; communicating these value propositions to all those people within the organisation responsible for delivering them and getting their buy in to their role; playing an appropriate part in delivering these value propositions to the chosen market segments and monitoring the actual value delivered.’
All focus on understanding customers and their present and future needs and finding ways to address those needs. Kotler and McDonald suggest delivering value is key. They call out the importance of delivering and measuring profit. Seth and McDonald definitions explain the importance of influencing and persuading. This applies both externally and internally to the organisation. Interestingly, none of the definitions mentions brand or lead generation.
E.J. McCarthy defined the 4P’s of marketing (Product, Price, Promotion and Place) in the early 1960s. Marketing’s task he suggested was to manage those 4P’s to maximum company benefit. Any author out to make a name for themselves has since claimed there are 5P’s then seven, then nine.
Jagish Seth suggests the marketing should control the 4A’s of Awareness, Acceptability, Affordability and Accessibility. This, in turn, is a development of the Coca Cola Company 3A’s. These are lofty goals for marketing to live up to.
Does Marketing Deliver Value?
If we take a step back it should be possible to answer the value question from first principles. If a business is not ‘identifying and understanding customer needs and coming up with solutions that satisfy customers and produce profit for the stakeholders’ (Philip Kotler) then what is it doing?
At this point, we could lurch into a review of the many articles on the value of marketing to an organisation but the above should be enough. A business must deliver value to its customers. Or, at least do a better job of providing delivering value than competitors. Identifying and satisfying needs is marketing. No customers equals no business.
There is a strong argument for measuring marketing ROI. Without solid marketing metrics, how can marketing expect to be taken seriously at the top levels of the organisation?
Perhaps marketing last hope was to deliver the numbers. Metrics that are relevant to the senior management team and business operations.
Unfortunately, if marketing is on the margins of the organisation then all it has to report on is its marginal impact.
So What Are The Key Problems Facing Marketing?
Managing the 4P’s and/or the 4A’s as defined by Jagish Seth is a big ask. Marketing has already failed to live up to those lofty aims. From A Cross-National Investigation into the Marketing Department’s Influence Within the Firm -Journal of international marketing (Volume 19(3) 2011 “Decisions in areas such as pricing, customer service, product development and distribution are not (my emphasis) dominated by marketing’ – that’s 3 of the 4P’s.
The marketing department cannot operate in a vacuum. It is down to the entire organisation to deliver and company culture is critical. Driving through change has to come from the top. If marketing does not have a seat at the top table it will always be struggling for support.
Perhaps marketing has created many of its own challenges. However unfair it may be the perception of marketing as the ‘arts and craft department’ persists. There are various types of marketer working in a wide range of businesses but most are suffering from a reputation problem.
Blurred Lines – Who Leads and Who Follows?
So, if not marketing then who is in control of directing business to achieve its aims?
A significant problem marketing has always wrestled with is one of its definitions. Person A makes the product – They are in production. Employee B buys things used in production – They are in purchasing. Person C recruits and trains people that work in the business – They are in HR. All clearly defined roles with little ambiguity.
With marketing, it is not quite so simple. Ask thirty laymen what an operations manager does and you will receive a reasonably consistent and largely accurate answer. Try the same with marketing and you will be presented with a wide range of answers. Try typing ‘top marketing experts’ or ‘famous marketers’ into Google and scan through the results. Everyone from Plato to Michael Phelps gets a mention.
In many organisations defining who is the marketer is the problem. There are many examples of a business founder (perhaps an engineer) spotting a gap in the market. They defined a customer need and developed a product to meet that need. Over time, they figured out how to provide simple and elegant solutions to sometimes complex consumer problems.
They decided how to reach out to the market and make them aware of the offering. They understood the market need, the price the market would accept, production issues and distribution.
Let’s assume the founder makes a success of the business. After a few years, they may remain involved in products and markets but delegate many of the tasks they originally took on to others. They may hire a Head of Marketing, Marketing Director, VP Marketing CMO or whatever you wish to call them. In this example, it is important to ask who is the manager and who is the marketer?
Was Lee Iacocca a business leader or a marketer, What about Henry Ford, Walt Disney, Steve Jobs or Alan Sugar? I suggest these business leaders were, in fact, the marketers. As business leaders, they all had (by definition) influence over what gets done. There was no issue with support for a head of marketing or marketing department further down the chain of command.
Now let’s return to the business strategy process. There may be a Head of Marketing who will have an input but in the above example, they are not the driving force. That again is the founder.
With an influential founder in place, the Marketing Director is not in control of the product and probably not price. They don’t decide on the marketing strategy and don’t have the influence to drive through change. So what do they do? They may have an input into channels and distribution and a major input into promotion. Then there’s that elusive concept called brand.
Who Develops Marketing Strategy?
The corporate strategy looks into the future and covers mission, business structure and responsibilities. It also defines overall goals and timescales and the key business numbers. Then there is a marketing strategy which covers how those higher-level goals will be achieved. The logical place to start with a marketing strategy is with the market and consumer.
The key is who is in control of strategy. In theory, if marketing is in control they deserve that seat at the top table and the influence that comes with it. After all, they are responsible for crafting the plan to ensure delivery of future corporate objectives. Unfortunately, that is rarely the case.
In the above example if the business founder is still active then they are likely to drive strategy. Marketing may have an input and could carry out the bulk of the important analysis work on which the strategy is built but the founder is in control.
If the founder has moved on or changed focus then are marketing in charge of strategy? In some cases yes but if they lack influence at the core of the organisation implementation of that strategy is a real problem. According to The Economist Intelligence Unit – Why Good Strategies Fail Report respondents say the number one reason for the success of strategic initiatives at their organisation is leadership buy-in and support.
A head of marketing must manage a diverse range of functions. To expect them to also have the skills and experience to build a robust marketing strategy is asking a lot. Building a strategy and plan is hard, it takes experience, time and resources.
If the business management team perceive a lack of in house skills or lack trust in the marketing department they may employ external consultants as strategists.
Is the strategic process valued by the business leaders? Is a valid question to ask in some organisations. Could this be the key issue? Perhaps at the boardroom level strategy has become a box-ticking exercise. Good, that’s done, now file it over there with last years edition.
If strategy is not valued at a corporate level. If there is a little trust in marketing or a perceived lack of capability then marketing best hope for a seat at the core of the organisation is gone.
Let’s refer back to the definitions of marketing (above). Both Seth and McDonald suggest the importance of influencing and persuading both externally and internally. Without the seat at the top table does marketing have that influence? If they are not supported by higher management what real hope do they have of modifying behaviour?
If marketing has little influence on strategy and is unable to influence change then it is a support function. As such it is vulnerable to being broken up into constituent parts.
The Sales And Marketing Conflict
If we refer back to the definitions of marketing defining consumer needs is a key part of them all. Who is closest to the consumer? In B2B markets that would almost certainly be sales. In B2C markets it could be one of the many links in the supply chain.
Sales may claim (with justification) they are closest to the customer. It is they (not marketing) who understand the customers’ needs. Marketing can argue in return that it is they who have the skills to take a long term view. They can group and classify needs and understand what is required to satisfy those needs. Their argument may be that sales focus (rightly so) is short term whereas marketing is more focused on the future.
The sales vs marketing relationship debate have been ongoing for decades and in many larger organisations remains unresolved. In truth sales and marketing are squabbling over the scraps. It is whoever controls strategy who is in control. However, If marketing loses a deep understanding of the marketplace or access to that marketplace then what is left?
Assessing The Future Of Marketing
So if marketing has lost its responsibility for strategy. It has lost high-level support for its initiatives and it has little influence on product or price what’s left? There is awareness building, there is channel management and there is brand. Customer experience and customer retention is also important. Each of these areas adds value but none (except brand) are at the core of the business.
Brand, when managed correctly, can be a powerful tool to distinguish a business from its competitors Where does brand come from? is it from the founder (see above strategy discussion)? Or is it crafted by marketing around an established core?
A successful brand must, on one hand, reflect the corporate values but on the other, it must be based on an intimate understanding of the consumer and their needs. It defines who is a customer and who is not. It offers a promise. Brand maintenance could be one area where marketing does have a future.
Brand alone will not recover the standing of marketing as a profession. In fact overemphasis of the brand and brand management has contributed to marketing downfall. It is difficult to measure the value of brand in financial terms. So what else can marketing use to build its reputation?
A Saviour (or is it?)
A saviour has ridden into town and his name is technology. Analytics show exactly how many prospects are engaging. They show touch points on the way to a sale and interest at various points in the sales cycle.
Messages can be crafted to match prospects (perceived) needs. Brand messages can pop up wherever prospects may go online. Marketing may claim they have regained the power to understand and interact with the consumer and they can do it at scale. They don’t need sales to feedback on what is happening in the market. It is in their data
A justifiable response to a point but the multichannel opportunities to reach consumers bring with them a significant level of complexity. A mass of potential touch-points brings with it a mass of data. There is a significant problem with attribution, that is identifying which touch-point was relevant and which was not.
Worse still a mass of data brings on data blindness. Like snow blindness, it prevents you from seeing what is right in front of you. Does a mass of data really help in identifying customer core needs?
One of the biggest issues for marketing in larger organisations has become how to manage the so-called marketing stack. Mark Schaefer in his book Marketing Rebellion said ‘Marketers are overwhelmed by data. Nearly 60% believe they cannot keep up with the technology overload’. The key problem is how to extract value and insight from a mass of data.
One Possible Future For Marketing Operations
Let’s assume marketing as a discrete discipline did not exist. Let’s take its constituent parts and allocate them to other business departments.
First the most difficult – Strategy – If the business founder is still involved (and still inclined) then I suggest it belongs with him/her. If the founder is not involved it becomes much more difficult. Perhaps a strategy department is the best way forward
With a strategy in place, the sales team should know their focus but strong leadership is required. There is always a conflict between long term organisational goals and short term sales goals. It takes leadership to remain focused on the overall picture rather jump from the latest crisis/pending major order to the next.
Assuming appropriate sales leadership and focus is in place then lead generating activities including Email, Website (and SEO), Advertising (including online), content and many more can fall under sales control. Customer service, customer experience and customer retention also probably belongs to the sales department. Many of these functions could also sit under operations.
Analytics and data analysis could sit under sales or operations. It could also sit under the accountancy function. The IT department could be responsible for website technology and the technical elements of SEO.
Responsibility for Brand is an issue. There is no ideal place for this to sit in a standard organisation chart other than the strategy department. Creative disciplines (design, video, audio, events) also have no natural home. They could be a separate department allied to sales or operations, they could fall under sales control or they could be outsourced.
None of the above is positive for marketing as a discrete discipline. Job titles including the term marketing may disappear in future but marketing itself (as defined above) must remain. Consumer focus, strategy and maintaining a competitive advantage have to remain or how is a business to survive over the long term?
Marketing as a discrete discipline may disappear but the functions of marketing have a future. Those functional elements of marketing will simply be dissipated under various business departments.
Marketing Organisation – The Way Forward
As outlined above the key issue is the failure to secure a place at the core of the organisation. Marketing has lost its hold on strategic leadership and the support from higher management it needs to function.
Some marketers have recognised ‘we need to personalise or perish’ that’s true. The problem is with the proposed solution – technology. The idea persists that the only way to do personalisation at scale is technology but what if there was another way?
I have a more radical suggestion (or is it a forlorn hope) and that is the future is small. What if we put people back in the loop. Not low skilled, cheap labour but people with a commitment to the business and the consumer. If that can be achieved then there is a chance for the head of marketing albeit under another name.
For ten years or more, there has been a trend away from people and to technology justified by its perceived lower cost. Is it really cheaper? What is the cost of the so-called marketing stack? It seems to be getting more complex by the day.
What if technology does not actually deliver the required results (see big data discussion above)? What is the cost of reducing sales and profits because consumers go elsewhere?
Philip Kotler in his book Marketing 4.0 said ‘Marketers should create brands that act more like humans. Approachable, likeable but also vulnerable’. If you want human then put humans back in the loop. That is where the future of marketing lies.
People make connections, it’s what humans do. If people were not interested in what others were doing. If they did not seek connections there would be no Facebook. You might not like Facebook, their culture and processes, but there is no dispute over the size of their user base.
This is not a new idea Mark Schaefer to name but one has been advocating the human approach for some time. His book Marketing Rebellion is subtitled ‘The most human company wins’