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Getting
Radical
By Michael Alan Hamlin
March 08, 1999
"What are the qualities of the
world’s best marketing organizations? According to authors
Sam Hill and Glenn Rifkin, you won’t find the answers in institutionalized
marketing formulas that are the pride of the world’s top advertising
agencies. For real insight, it’s best to look to "an eclectic
group of professionals — engineers, rock stars, lawyers, academics,
consultants, technologists — whose résumés hardly
resemble that of a professional marketer." These are people
who "became radical marketers because they had no choice,"
say Messrs. Hill and Rifkin.
In their new book, Radical Marketing:
From Harvard to Harley, Lessons from Ten that Broke the Rules and
Made it Big, Mr. Hill, a former big-firm professional and now consultant,
and Mr. Rifkin, a respected business journalist, identify three
success-generating qualities of radical marketers. First, they have
"very strong visceral ties with a specific target audience."
In other words, they understand the way their customers think.
Radical marketers, the authors argue,
understand their customers because they personally spend time in
the marketplace, rather than rely on focus groups and market research.
As a result, the connection to the customer is a much more emotional
link than that found inside brand-driven corporations that base
their decisions on an intellectual understanding of the market.
"It is not unusual," the
authors write by way of example, "to attend a meeting in New
Jersey where a thirty-year-old white male who makes $125,000 a year
and grew up in an affluent American suburb stands in front of a
room and proposes a communication strategy for incontinence products
aimed at a seventy-year-old lower-income African American woman
in Miami." His only understanding of the target audience is
from some highly amalgamated, quantitative attitudinal research
and a few focus groups." By contrast, radical marketers look
like their customers because they are "trained in the market
itself."
Interestingly, the authors illustrate this first point by initially
citing the case of a chief executive of a pet food company who considers
his customer the pet, not the owner. Figure that. The other examples
are better.
The second quality of radical marketers
is they "tend to focus on growth and expansion rather than
on profit-taking." The authors illustrate their point by relating
the case of Jim Koch, founder of Samuel Adams Boston Lager —
now Boston Beer — the top-selling craft beer in the U.S. "In
1984 Koch literally carried bottles of Sam Adams beer from bar to
bar," Messrs. Hill and Rifkin explain, "trying to interest
bartenders in his new brew."
But it seems that the authors are
really talking about the tradeoffs inherent in building a new business.
Entrepreneurial or otherwise, new businesses require a period of
development during which, ideally, customer loyalty is established.
There’s really nothing extraordinary in initially sacrificing
returns to establish a business. More importantly, other authors
show that failure to focus on profitability — even future profitability
— frequently fosters sloppy efficiencies and lagging productivity.
Getting out of that rut is not easy,
as Eric Flamholtz shows in his most recent book, Changing the Game.
Mr. Flamholtz illustrates the invariably traumatic transformation
from entrepreneurship and mid-market enterprise to professional
organization. The most common — and the largest — obstacle
to transformation in his case studies is the switch in focus from
revenue to profitability; from being busy, to getting results.
Likewise, Adrian Slywotzky and David
Morrison in The Profit Zone argue that single-minded focus on market
share and expansion, even for established firms, too often results
in a successful product, in terms of market share, produced by an
unprofitable business. No where is this more painfully obvious than
in crisis-hobbled Asia, where uncompetitive conglomerates occupied
themselves for generations building asset bases financed with extraordinarily
ill-advised levels of debt.
However, Messrs. Hill and Rifkin
show this doesn’t have to be the case, at least in their case
studies, which actually do include Harvard Business School and rock
star Madonna. But it is likewise true that many of their case studies
involve organizations — an interesting way to think of Madonna
— whose industry leadership is in doubt. While these organizations
are undoubtedly leaders, they are not the leaders, and their leading
positions are under effective assault.
The third quality of radical marketers
is their "tendency to be very resource-constrained," forcing
them "to make do with marketing budgets that are far smaller
than average." This kind of business the agencies aren’t
interested in anyway, but the authors’ point is that "such
resource constraints tend to keep them (radical marketers) very
focused and promotes a willingness to try new, innovative ideas
and ‘out of the box’ marketing concepts.
"Classical marketers find this
state of mind difficult to emulate; bureaucratic corporate structures
lack the flexibility to encourage creative thinking and entrepreneurial
behavior," the authors marvel. While this is a valid point,
it’s also an obvious one, made for years by authors and gurus
beginning with Tom Peters and Robert Waterman in the modern classic,
In Search of Excellence.
The authors’ first big revelation
to illustrate creative thinking is Boston Beer’s introduction
of menu stands. "Restaurants send their menus or beverage lists
to Boston Beer, which produces tent cards and menu stands with the
Samuel Adams logo on them. The company today produces more than
two million menu cards a year."
Interesting business for a brewery.
Copyright © 1999 The Events
& Awards Managers of Asia and
Hamlin-Iturralde Corporation. All rights reserved.
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