1. Summary of How It’s Done MARKETING S imple tm “Principle-based Marketing” Non-narrated, PowerPoint Slide Presentation with Notes Mike Ahlstrom 33 Slides April 3, 2012 ©2012. Mike Ahlstrom. All rights reserved. Unit 1

2. I. Introduction

3. Requirement You agree to hold me, my school and students harmless. This presentation and my book are only giving you advice. You should consult with other professionals. You use this material at your own risk.

4. You Are you struggling with marketing? If you’re not struggling with it right now, you will be! What will you do when customers don’t show up?

5. Me I know marketing. I have taught it fulltime at a state university for six years, after a 35-year career in business. I worked as a marketer in big marketing firms – P&G, Pillsbury, Land O’ Lakes – for 10 years, followed by other companies, consulting, and a successful start-up.

6. Business Prosperity MARKETING S imple tm is where marketing is made more successful by basing it on the main principles of marketing! Marketing is the weak link in the chain for many products. It is the most likely business discipline to fail.

7. Fail? Consider: – The American Marketing Association has changed its definition of marketing 3 times in the last 10 years. – There is very high chief marketing officer turnover – 24 months, on average. What does that imply? – CMOs have low credibility – just 3% sit on boards of directors of public firms, vs. 26% of chief financial officers. – See http://www.emorymi.com/MarketingisDead.shtmlhttp://www.emorymi.com/MarketingisDead.shtml – See http://www.bizresearchpapers.com/21.%20Roger- FINAL.pdfhttp://www.bizresearchpapers.com/21.%20Roger- FINAL.pdf – See http ://news.cnet.com/8301-13641_3-10159044- 44.htmlhttp ://news.cnet.com/8301-13641_3-10159044- 44.html – Ask new marketing graduates to outline how they would do a marketing plan. See how fast they mention the 4 Ps, especially promotion. Why the problems in marketing? It has no clearly identified main principles!

8. II. Introduction to Principles – Example Learning Case

9. Camay – 1973 Camay Soap – What would you do? The brand had been steadily losing market share for years. A.Develop entirely new TV advertising? Camay was spending most of its promotion budget in TV. B.Or change its marketing strategy? C.Read more about Camay, next.

10. 1973 – Cincinnati, OH; P&G Headquarters; 10 th Floor Camay was a relatively small brand. However, it was culturally important. Key company executives had managed Camay. They didn’t want it to die. It was a good place for a new brand manager to show his stuff. Not a new-comer to Camay – I knew the brand intimately – I had been its assistant brand manager for a year earlier in my career. My hope now was that of all new brand managers: do something impressive. I wanted to bring Camay back to life. From a Situation Analysis Birth: Camay, born in 1926, was a mild, gentle soap for women. Its name came from the French word, “camée” (the jewel), referring to the soap’s cameo stamp on its top. Rise to respectability: in the early 1950s Camay had about 20% of the market. It was doing well. Two key competitors were Palmolive and Lux. Fall from grace: during that time, a new kind of soap, called a detergent which worked better in many situations, became more broadly used. Detergents, unlike soaps which are quite alkaline, are slightly acidic, and as a result are gentler on skin (which is also mildly acidic). A new detergent-based bar, Dove ® Unilever – “One-quarter cleansing cream” – was launched by Lever Brothers in 1957. By 1973, Camay’s share of store sales had fallen to 6.0%. Shelf space could be lost next. Tried: four carefully considered steps were taken to strengthen Camay’s business – one before Dove, three after it launched. None worked: 1. In the early 1950s, foreseeing stronger competition, the brand adopted a “soft skin” positioning – a big issue with women – by adding the words, “contains cold cream” to Camay’s wrapper, which was interesting because research showed women would not respond to the claim. To my understanding, while Camay did contain a very small amount of an emollient (cold) cream, it did nothing for skin because the cream was washed away by the soap action of the bar. The hope apparently was that over time the soft skin positioning would sink in. It didn’t. 2. About 1970, Camay’s tallow formula was modified to contain about half coconut oil soap, which made twice as much lather. It also cleaned really well, because the coconut oil-based soap went unto solution so well and was very basic. 3. At the same time, the wrapper was changed from paper to a prettier, soft, plastic foam-based material. 4. When assigned to Camay previously as its assistant brand manager, I had been part of the team that adopted the closing line in current TV ads, “Camay, the Beauty Cleanser” (with questions in their minds about what it meant), spoken by a paid, celebrity presenter, beauty expert, and author – Princess Luciana Pignatelli from Italy. A Strategic Fix Needed? In retrospect, after becoming Camay brand manager in 1973, the initial “picture” I constructed of its marketing mix, of strategies the brand group controlled, was not very revealing. Solely from what was soon to be called the four Ps by Jerome McCarthy (Product, Place, Price, and Promotion) – P&G used a rough equivalent back then – there was apparently nothing new to learn or fix. The brand was already spending $5 million per year in promotion, 60% in TV, and Camay was still sinking! Its ad agency periodically suggested totally re-vamping its advertising. What Would You Do to Fix Camay? A.Develop entirely new TV advertising? B.Or change its marketing strategy – Camay’s 4 Ps marketing mix as it then existed? C.Something else? Case recommences on slide 23.

11. III. Goal of Marketing: Prosperity – an Abundant Life!

12. Abundant Life A life full of – Prosperity – Usefulness/service – Happiness – Goodness – Blessings – Success – Joy Abundance: the American Dream What are you willing to do to achieve it? Adopt three principles?

13. IV. Main Principles of Marketing

14. Main Principles of Marketing 1.Purpose. The purpose of marketing is to create and sustain demand profitably and honorably. 2.Process. Demand is not created magically with creativity, but rather by using a standard, mark- eting planning process, with creativity at the right time, in the right way. 3.Practices. Marketing planning must be fast, transparent and team-based, because competi- tion and opportunity never end, and because marketers always need the cooperation of other disciplines.

15. Discussion of Principle #1 Create and sustain demand profitably and honorably. Just 7 words! Must be direct; want no confusion. Not 27 words like the current AMA definition.AMA definition So, do enough people demand your product? If they don’t, use the MARKETINGPipeline tm (MPL), next, to create demand.

16. View of the Standard Marketing Planning Process – the MARKETINGPipeline tm – Principle #2 Create and Sustain Demand Profitably and Honorably Purpose – Principle #1 Process – Principle #2

17. Discussion of Practices – Principle #3 Marketing planning must be fast. You never know when an opportunity or crisis will occur. Transparent so others can buy-in. You expect them just to trust you, without understanding? Marketers must work as a team with other key managers. They too have a big stake in how successful marketing is. Memorize the main principle, the process (the MPL), and the above practices. Be able to explain to the management team how you’re going to plan marketing!

18. V. How to Use Marketing Textbook Concepts

19. Put Key Marketing Text Concepts Around MPL Segments; Use them as Appropriate Concepts Related to Analyzing Concepts Related to Functionalizing Concepts Related to Operationalizing Concepts Related to Strategizing

20. Full MPL with Key Text Concepts Textbook Concepts Related to Analyzing Textbook Concepts Related to Functionalizing – IMC; the promotion mix (6 tools – advertising, PR, direct marketing; sales promotion, interactive/word-of-mouth, personal selling); Add Others Textbook Concepts Related to Strategizing Textbook Concepts Related to Opera- tionalizing Measures and Metrics; Add Others 4 Ps; 10 – 11 Ps; Add Others 15 Ways to Analyze: Foundational; Projection, i.e., Pain Point Analysis – “would I buy it?”; Observational; Business Data; Lifecycle; Category; Internal Situation; External Environmental; Competitive; Strategic Profitability Model (DuPont Model); Blank Strategic Marketing Plan; Marketing Research (secondary/primary); Porter’s Five Forces; SWOT; Gap (for services); Feelings – ow you feel – a nagging sense of something is wrong. Add others Research Data / Observation Pilots, Test Markets Mgmt. Approval Your Objective? Create and Sustain Demand Profitably and Honorably !

21. MARKETING S imple tm Features Works for any product; can produce a tailor-made marketing plan for every product, fast Integrates main principles with needed actions Simplifies/standardizes planning; is visual/memorable Produces 1-page/1-day Strategic Marketing Plan (SMP) SMP morphs easily into 4-page Functional MKTG Plan MKTG Plan readily expands into 10-page Business Plan Integrates 7 “checks” into the planning process

22. MARKETING S imple tm Benefits MARKETING S imple (MS) can double, triple, 5 - 10X your odds of success vs. not using a standard marketing planning process MS increases credibility with other disciplines MS builds a sustainable competitive advantage. As you learn it/use it, your marketing can standout, can lead to prosperity/abundance, can really help your career!

23. See How Analyzing/Strategizing Works P&G Brand; Born in 1926; $30 million in sales in 1973; its share of market had fallen 1957 - 1973 from 20% to 6%. What Would You Do? A.Develop entirely new TV advertising? Camay was spending most of its promotion budget in TV. B.Or change its marketing strategy – Camay’s 4 Ps marketing mix as it then existed? C.Do something else. As Camay brand manager, I used the MPL! Example – Camay Revisited

24. A Failing Brand – 1973 4 Ps Snapshot Place Supermarkets, drug stores, mass merchandisers Price for Profitability $.29 per complexion bar; $.41 per bath bar Promotion $5 million in yearly promotion spending, $3 million of which in TV advertising featured a beauty expert saying, “Camay, the Beauty Cleanser” Camay Product High lathering soap that cleaned really well (“next best thing to paint thinner,” one company expert had jokingly said)

25. Expanded Camay 4 Ps Snapshot to 7 Ps and Immediately Saw the Disconnects Place Supermarkets, drug stores, mass merchandisers Price for Profitability $.29 per complexion bar; $.41 per bath bar Promotion $5 million in yearly promotion spending, $3 million of which in TV advertising featured a beauty expert saying, “Camay, the Beauty Cleanser leaves my face soft, smooth” People All women, especially women with dry skin Product High lathering soap that cleaned really well (“next best thing to paint thinner,” one company expert had jokingly said). Technical note: strong cleaning aggravates dry skin. Promise (the Big Benefit) Soft Skin Positioning/Branding “Beauty Cleanser”

26. Fixed the Disconnects – Changed the Target Market Place Supermarkets, drug stores, mass merchandisers Price for Profitability $.29 per complexion bar; $.41 per bath bar Promotion Same spending, with the expert now saying, “Camay, the Beauty Cleanser, leaves my face soft, smooth, and not greasy” (as she wipes her hands down, along the sides of her nose, out across her cheeks) People Women with oily skin (about 27% of all women) Product High lathering bar soap that cleans really well (removed words “contains cold cream” from wrapper) Promise (The Big Benefit) Beautifully Clean Skin Positioning/Branding “Beauty Cleanser”

27. Camay’s Business Turned Around! Because the brand team first focused on: – What the purpose of marketing was – “create and sustain demand…” – And used a standard planning process to deliver that purpose. Specifically, the team analyzed, strategized, function-alized, and operationalized – Used more Ps! Changed the marketing strategy so the target market lined up with what the product actually did Adjusted the advertising slightly Implemented the improved advertising Results? Sales increased $1 million the following year.

28. Today, There are 10 to 11 Ps – the Full Marketing Mix, Which Marketers Control Place/Presence Price for Profitability Promotion People – The target market Product 1 – Your product; its features Promise – The big benefit your product provides Positioning/Branding Proprietary Parts – Things like patents, trademarks, trade secrets, special relationships Product 2 – What else has to be there Proof – Not legal proof, but business evidence the above mix will create demand

29. VI. Summary

30. Reflection What would the Camay brand group have done in 1973, if we had not focused the definition of marketing on demand and what it would take to create it? If we had not continued to analyze the situation until it found out what was wrong? Had not challenged the role of the 4 Ps, then expanded them to 7 Ps, in the process subse- quently changing Camay’s target market? Had simply done more “creative” ads, as our ad agency wanted?

31. Do It! Use the MPL to Plan Your Product’s Marketing Plan one product at a time. Analyze where your product is at/why; set a goal. Do a 1-page Strategic Marketing Plan as a team, or have some very advanced students do it for you. Hold off doing a functional marketing plan. Discuss your SMP with me. Email me (mike@uidaho.edu) or call my residence at 208-596-4225 after 5:00 p.m.mike@uidaho.edu

32. So You Want Your Product to Prosper? Read the book MARKETING S imple tm for more understanding. Memorize key parts principles and the process. Adapt the process/concepts as needed: Is demand for your product weak? If yes, your marketing must create and sustain more demand… To do that, use a standard marketing planning process – the MARKETINGPIPELINE – to actually deliver demand. Take these steps separately; do not skip any or mash them altogether: – Analyze and set a goal – Strategize; use the full marketing mix – the 10 – 11 Ps to line up all of the drivers of demand; do a full SMP – Functionalize; plan and work out all key details of an integrated marketing communication program; set the budget; get top management input and approval. Without approval, you have no plan. – Operationalize; measure and correct – Use the checks Work very fast, transparently as a team Iterate! Do it over and over and over again! Practice! Get good at it! Your marketing can become more and more successful, your business more prosperous, and your life (and employee lives) more abundant!

33. End of Unit 1