related marketing and corporate social responsibility

Journal of the Canadian Institute of Marketing Le Journal de l’Institut Canadien du Marketing

Cause Related Marketing (CRM) Cause Related Marketing is simply marketing with a worthy cause. Together, these powerful alliances (not-for-profit organizations and companies) can success-fully work together with unique marketing tools to influence change and create better solutions. CRM is a form of marketing that uses various strategies, tools and traditional advertising meth-ods to change attitudes, per-ceptions and behaviours as

they relate to social issues. Non-profit organizations and companies form alli-ances to market images, ser-vices and products. Seventy-eight percent of people have a more favour-able view of a company that contributes or sponsors a cause that they think is wor-thy. For instance, people are more likely to be interested in a company that is con-tributing to cancer research than one that is contributing to bug research! Now who’s to say that bug research isn’t worthy? People decide if it’s a worthy cause. And if it doesn’t affect the “people”, who’s to say it’s worthy? The Prince of Wales was once quoted as saying; “Business in partnership with charities and causes can play a vital role in the regeneration of communi-ties.” Cause Related Market-ing is an exciting concept

where both business and charity (or good causes) can benefit. It also attracts new sources of funds, resources and support. Social Marketing: (SM) “Social marketing is the strategic use of commercial marketing principles and techniques to address social issues such as health care. It is an innovative and poten-tially powerful tool to im-prove the lives and well-being of individuals, create environments that support social objectives, re-orient social services to be cus-tomer-driven, develop social capital, lead to improved public policies, and ulti-mately, achieve social goals.” R. Craig Lefebvre, Chief Technical Officer Prospect Center Social Marketing uses com-mercial marketing strategies to distribute non-profit continued on page 2

Volume 7, Issue 2

www.cinstmarketing.ca

The Description of Social, Cause-Related Marketing and Corporate Social Responsibility By Michael Skory and Shelley Repka, MCInst.M

Spring 2004

Inside this issue:

CIM Australia sends greetings

3

The growing interest in caring for customers better

4

Service strategies for a global brand in a developing country

7

Marketing management education

14

Do you have the nerve to create a cult?

16

Brand management myth

19

Members honoured for their work

21

Transforming fee earners into marketers

22

Member profiles 24

Member mentions 25

AGM heralds new year of hard work

26

Shelley Repka

Saluting Canadians serving oversees

Editor A. Grant Lee, B.A., M.A., M.C.I.P., R.P.P., FCInst.M. Publications Advisory Committee Leonard E. Weeks, MCInst.M. Joshua Caplan MCInst.M James Schauer, FCInst.M. Suzen Fromstein, MCInst.M. The Marketing Challenge is pub-lished three times a year by the Canadian Institute of Marketing and distributed to members free of charge. The views and opin-ions expressed herein are not necessarily those of the Canadian Institute of Marketing. Copyright is reserved. No part of this pub-lication may be reproduced by any means without permission from the editor, telephone (905) 877-5369. All advertising requests and copy should be sent to: Canadian In-stitute of Marketing, 205 Miller Drive, Halton Hills (Georgetown), Ontario, Canada, L7G 6G4. Tel: (905) 877-5369, Fax: (905) 702-0819, [email protected]

Canadian Institute of Marketing

L’Institut Canadien du Marketing

205 Miller Drive

Halton Hills (Georgetown) Ontario, Canada L7G 6G4

Tel: (905) 877-5369 Fax: (905) 702-0819

www.cinstmarketing.ca

products and services. It promotes ideas to alter behaviour. It usually focuses on health is-sues like safe driving, family planning, and energy conservation. For instance, take the warnings on a typical cigarette packages from Health Canada:

Most Social Marketing campaigns develop messages or advertisements fit for use in the tra-ditional commercial marketing arena, basically the mass media. Community Based Social Marketing (CBSM) Mass media is one of the most effective approaches to alter behaviour. Time, knowledge, target audience and cost may restrict its application. To address these constraints Commu-nity Based Social Marketing has been developed. It uses specialized tools to help a program designer promote behaviour change without limiting information. Central to the development of a CBSM program are 3 questions: 1. What behaviours should be promoted? 2. What should the program address or target? 3. What conditions will an individual face in deciding to adopt new behaviour? Example: Community-Based Social Marketing Model For Circle of Friends

description of social, cause related marketing………………..….cont’d from page 1

The Market ing Chal lenge

Problem exists Benefits & barriers are identified

People are drinking alcohol when they are pregnant

How to convince peo-ple not to drink when pregnant • Promote signs for

your cause • Reach out to the

people • Talk to your

target

Get the word out, measure the “attitudes, percep-tions, behaviours” to get a bench mark

Pilot program launched

Community wide program is launched

Promote your thoughts through newspaper, town meetings; suggest action to the town council

Evaluation & impact is studied

Did the promotions change people’s thoughts and actions?

Problem is solved! continued on page 3

Community Based Social Marketing uses 5 tools: • Commitment is performed by ask-

ing a person to change their behav-iour using verbal or written agree-ment

• Prompts are visual or verbal aids that remind a person to carry out an activity or obligation that they might otherwise forget

• Norms guide how a person behaves because they look around for clues on how to respond

• Communication is used to per-suade, educate and communicate desired behaviour

• Incentives are used to motivate a person to continue performing de-sired behaviour

Corporate Social Responsibility (CSR) Corporate Social Responsibility is the commitment of a business to contribute to economic development while improv-ing the quality of life of the work force and its families as well as the local com-munity and society. CSR focuses on 3 main ideas: Society Environment Financial Successes The goal of every cause-related, social and community-based marketing cam-paign is to promote a greater awareness and consumer participation of the exist-ing programs to demonstrate the power of brand in partnership with charities and social causes in order to make a positive impact on society as a whole. Shelley Repka is the President of Cool Pro-

jects with Revelation Marketing. Revela-tion Marketing specializes in developing cause-related “social” marketing plans. To contact Revelation Marketing please phone, (403) 714-1740, email: [email protected] or visit their website at www.revelationmarketing.com.

CIM Australia sends greetings

The Canadian Institute of Marketing and The Chartered Institute of Mar-keting Australia have opened commu-nications to forge a relationship based on matters of common interest. Initiated by V.P. and Registrar, Shiv Seechurn, we are optimistic about a relationship that would benefit mem-bers in both organizations. We were contacted by Alan Buttery, FCInst.M, Chair of The CIM Australia and Professor of Marketing UWS who sent our Institute greetings at its An-nual General Meeting on June 26. In his letter of salutations, Mr. Buttery congratulated the Canadian Institute on its progress in Canada and noted that its growth as a national profes-sional marketing organization faces very similar issues as those facing the Canadian Institute. We can certainly learn from each other. He noted meld-ing CIM’s educational requirements with its tertiary education system and ensuring that graduates join the CIM Australia. We are active on the same front. As with the Canadian Institute, the Australian Institute is working hard at developing links with govern-

Volume 7, Issue 2

description of social, cause related marketing………….cont’d from page 2 ment and industry. The Australian Institute wants to get involved in setting standards for mar-keting and are working on a set of standards for marketing consultants. This is an area of interest to the Cana-dian Institute of Marketing that we will explore with our Australian coun-terpart. The Australian Institute is also a small organization with great growth poten-tial. The Institute’s Secretary, Manoji Sundaranathan worked on the incor-poration of the Australian Institute, and their public relations expert, Car-men Corrandini is responsible for newsletters and events to keep mem-bers informed. The Institute is liaising with industry and government through member Roger Johnston who is cur-rently working on a strategic plan. They have a Web site under constant development managed by Kaleel Rah-man. Alan Butterly has taken on the task of building relationships with the education sector. All of the Australian activities sound most familiar to active members of the Canadian Institute of Marketing. There seems to be a significant differ-ence between the two Institutes and that is in their organizational structure. The Canadian Institute of Marketing is not a branch of the CIM UK, al-though we share a close and very pro-ductive relationship that runs deep through our 22-year history. We are working with the CIM UK on educa-tional issues, and look forward to sign-ing a memorandum of understanding on certain activities and interests shared in Canada and the U.S.A. These are exciting times for marketers and extended hands of friendship from like minded organizations such as the Australian Institute are wel-come.


There is growing interest shown by all categories of businesses in terms of customer care and man-agement of customer relation-ships. This is due to growing com-petition and the resultant choices to which customers are exposed. It makes good business sense to care for your customers with the aim of building loyalty and retain-ing them. Why customer care is impor-tant? The following customer service facts, speak for themselves. a. A typically dissatisfied cus-

tomer, will tell 8-10 people about their problem.

b. It costs six times more to at-tract a new customer than it does to keep an old one.

c. 80% of successful new prod-uct and service ideas come from customers.

d. If you resolve a complaint on the spot, 95% of complaining customers will continue to do business with you again.

e. Firms selling services depend on existing customers for 85% - 95% of their business.

The following statement made by Sir Colin Marshall of British Airways, sums up the importance of customer care ef-fectively. “The simple principle is that the company exists to serve its customers, long into the future. Business leaders that act on this, and persuade all their people to believe in it, can transform ordinary companies into world beaters.”

Methods to be better at customer ser-vice Good customer service revolves around respect for the customer, his or her time and intelligence. Customers hate uncer-tainty. They also hate waiting but can manage it if they are provided with an honest accurate answer. The following steps will help provide a better service to customers. a. Don’t keep your business closed

when you should be open. The im-portant thing in business is to be open! We now see in Sri Lanka, su-permarkets operating extended hours and even retailers and restaurants

b. Answer the telephone speedily, pref-erable within 3 rings. Never keep a customer on hold, listening to your selection of music, when the cus-tomer simply wants your speedy at-tention.

c. Knowledge of your product and ser-vice is important. Be knowledgeable about what you talk about to a cus-

tomer. It is better to be honest and truthful and avoid unnecessary jar-gon.

d. Never run out of stock because this is unacceptable in this day and age of electronic commerce.

e. Do not over charge the customer for a few mundane extras. It is better to include all costs chargeable in your quotation, rather than frequent addi-tions, which end up irritating custom-ers.

f. Delivery of product and service on time is important. Once a commit-ment is given to the customer, this should be fulfilled, unless in very ex-ceptional circumstances.

g. When making refunds, it is important to be decisive and fast. By unneces-sary delays, the opportunity of main-taining customer good will through the refund will be lost.

h. Make it easy for customers to make payments. After all the customer is willing to pay you and you should not make it a painful experience.

i. It is better to under promise and over deliver rather than the other way around. In this manner you will not lose the respect and regard of the customer.

These are some of the main methods adopted by companies striving to im-prove their customer service. How to cultivate and manage a cus-tomer relationship Customer relationships occur at the point of contact. This is also the start of a rela-tionship process. The following methods will help organizations improve customer relationships. continued on page 5

The growing interest in caring for customers better — for competitive advantage and growth

By Prasanna Perera, F.C.I.M. (UK), M.C.Inst.M., M.S.L.I.M., Marketing and Management Consultant, Chartered Marketer—CIM (UK)

Prasanna Perera

The simple principle is that the com-pany exists to serve its customers, long

into the future. Business leaders that act on this, and persuade all their peo-ple to believe in it, can transform ordi-nary companies into world beaters.

Sir Colin Marshall, British Airways

Volume 7, Issue 2

a. Begin by listening to the cus-tomer. There is nothing more irri-tating to the customer than a manufacturer unwilling to listen. By listening carefully, you indicate to the customer your seriousness and commitment towards what is expressed.

b. Be genuinely helpful to customers, when help is short. It may even be better to volunteer and help. For best results, provide the customer with assistance promptly.

c. Make it easy for customers to complain, because this is valuable feedback, which can be used to build relationships with custom-ers.

d. It is important to respond to cus-tomer complaints promptly. A customer making a complaint, ex-pects a response. The worst thing to do is to ignore complaints.

e. Organizations will do well, to en-courage customer loyalty and good will. It is only loyal custom-ers that will provide you consis-tent returns. There are many methods of building customer loyalty, such as loyalty pro-grammes, special promotion and preferential treatment.

f. Customers are after all human and want to be cared for. Treat all cus-tomers well and make them feel special.

g. Being nice to a customer is not enough. Niceness is a process.

assume niceness is enough. h. When a customer is lost, it is im-

portant to take the time and ef-fort, to find out the reasons. This will help you to avoid certain mis-takes, so that your existing cus-tomers do not get effected.

i. However strong a customer rela-tionship, it should never be taken for granted. Your competitors are always making attempts to secure your customers. So, once a rela-tionship had been built, work hard to retain it.

Customer care in practise Consider the example of Nordstrom, thought to be America’s number one customer service company. What is the secret of its success? Nordstrom is successful because of the following principles: a. Nordstrom empowers its employ-

ees with the freedom to make de-cisions, and is willing to live with those decisions.

b. Nordstrom expects, encourages, preaches and demands individual initiative and ideas from its front-line people.

c. Motivated employees perform “heroics” – acts of outstanding customer service, which are part of the Nordstrom mystique.

d. Nordstrom’s’ best salesperson will do virtually everything possible to ensure that a shopper leaves the store a satisfied customer.

e. Because Nordstrom pushes deci-sion – making responsibilities down to the sales floor, shopping with a Nordstrom salesperson is like working with the owner of a small business.

f. Salespeople must have a complete understanding of the product and its selling points.

g. “The customer is always right” is not a cliché at Nordstrom.

ture and philosophy is not difficult to pass on to the next generation because its simple: “Give great cus-tomer service”.

i. Keeping current good workers with the company is just as important as attracting new ones.

j. If you treat customers like royalty and let them know that you will take care of them, they usually come back to you.

k. “Trust” is the coin of the realm. Sales people earn the confidence of customers by being well versed in the merchandise they sell. They aren’t just selling merchandise, they are also selling service.

The stated principles are not magical. They border on common logic and sim-ple application of business processes. Another example comes from the mar-ket place performance unit in British Airways. When Sir Colin Marshall be-came Chief Executive of BA, he realised that it was vitally important to see things from the customer’s perspective. He therefore created a “Marketplace Per-formance Unit” that has the job of measuring and benchmarking operating performance. Their job is to find out what the customers really want, rather than what the management thinks they want. A good example of this comes at check-in time. The management view had always been, that what concerned passengers most was the time it took to get to the front of the queue. However, when the Marketplace Performance Unit asked passengers, they found that they were far more concerned with the length of the queues and the rate at which they moved. This obviously meant a different ap-proach was needed, than had been adopted before. Listening to the cus-tomer always helps! continued on page 6

growing interest in caring for customers………………..cont’d from page 4

rasanna Perera

CIM (UK) loses its CEO

As a result of forthcoming restructur-ing at The Chartered Institute of Mar-keting (CIM), Peter Fisk left his posi-tion as Chief Executive Officer in April. Fisk joined the CIM in February 2003 with a remit to make changes which would enable the CIM to achieve the International Board of Trustees’ (IBT) vision of becoming the world’s lead-ing professional body for marketing. He introduced the new strategy and led a re-organization as well as imple-menting a range of new and enhanced products and services. The CIM has since embarked on a comprehensive review of its constitu-tion and group structure in the light of its charitable status. As a result, the role of Chief Executive is undergoing fundamental changes and this had a consequent impact on Fisk’s original brief.

ACPB elects A. F. Perera The Association of Certified Profes-sional Marketers elected Ajit F. Perera President of the parent body and ACPB Sri Lanka Chapter on February 13. Mr. Perera, co-founder and Hon-ourary President of the Association of Certified Professional Marketers is Managing Director of Gas Conver-sions (Private) Ltd., Pepiliyana, Sri Lanka. He can be contacted at 00-94-11-5-542642 / 3

new perspectives to be considered in managing and caring for customers. The market leaders of the future, will be those whose strategy is based upon delivering superior customer service. Against this background, it must also be borne in mind that customer de-mands have escalated significantly, competition within and across market sectors has grown rapidly, and tech-nology will be the key to reducing costs of superior service. (But technol-ogy will not be a substitute for peo-ple).

“To customers, your most important ability is reliability” Prasanna Perera is a marketing and Management Consultant and Senior Lecturer in Marketing Management. He is a chartered Marketer with the CIM (UK), and recently elevated to Fellow of the CIM (UK). He can be contacted at : [email protected]

How to improve business processes, in order to provide excellent cus-tomer service Business processes adopted can have a positive or negative impact on the levels of customer service provided. The fol-lowing list provides some insights on how business processes can be im-proved. a. Innovate all business processes to

keep up with the times. This can be done by creating a more innovative culture using experiments and initia-tives to unleash and exploit the or-ganization’s ideas.

b. Monitor your competition, in terms of their business processes.

c. Don’t assume because its on the computer it must be right. Com-puters seldom err. Remember, gar-bage in garbage out! It may be a computer error to you, but it’s often also lost business.

d. Be part of the solution, not the problem. This is an important ele-ment of business process. When you are part of the solution, people want to talk to you. When you are part of the problem, they want you to go away.

e. Concentrate on the big picture, and worry about details. Obtaining cus-tomer feedback is important, through focus groups, and customer satisfaction measurement.

f. Study and learn from best practice, to benchmark effectively.

g. Empower staff to take decisions that have an impact on customer satisfaction. There are many opera-tional decisions to be made at the point of customer contact.

Conclusion This short article has aimed to highlight the salient aspects of customer care. Car-ing for customers is nothing new. It has been the bedrock of business success for generations. However, there are many


growing interest in caring for customers……………….continued from page 5

Customer satisfaction is no longer good enough to survive in today’s competitive market place. What is

needed is customer delight.

Tom Peters

Abstract A review of the literature on Services marketing reveals several touted benefits. There is also the need to deploy astute service support strategies to ensure successful service delivery. This paper does a qualitative investigation of Caterpillar the global leader in the manufacturer of construction and mining equipment, diesel and natural gas engines and industrial gas turbines, in respect of Service Support Strategies. Paper reports that the deployment of service support mechanisms and strategies have contributed greatly to the market leadership of Caterpillar in Ghana. Paper also outlines areas of further research in respect of international service brands in a deve l -oping country context What are services? Fitzsimmons and Fitzsimmons (2000) emphasizes that many defini-tions of service are available but all contain a common theme of intangi-bility and simultaneous consumption. Gronroos (1990) on the other hand, defined a service as an activity or se-ries of activities of more or less intan-gible nature that normally, but not necessarily, take place in interactions between customer and service em-ployees and/or physical resources and/or systems of the service pro-vider, which are provided as solu-tions to customer problems. An all encompassing definition con-siders services to include “all eco-

nomic activities whose output is not a physical product or construction, is generally consumed at the time it is produced and provides added value in forms (such as convenience, amuse-ment, timeliness, comfort or health) that are essentially intangible concerns of its first purchaser. (Baruch, Paquette and Quinn, 1987). Indeed while the consumer cannot retain the actual service after it is produced, the effect of the service can be retained. (Sasser, Olsen and Daryl, 1978) Distinction between services and cus-tomer service It is important also to draw the distinc-tion between ‘services’ and ‘customer service’. While in the simplest terms ser-vices are “deeds, processes, and per-formances” customer service is the ser-vice provided in support of a company’s core product (Zeithaml and Bitner, 2000). Services as broadly defined above covers a wide range of industries includ-ing the financials, to which insurance broking belongs. From marketing mix to relationship marketing The marketing mix as a concept intro-duced by Neil Borden in the 1950s, and labelled the Four Ps developed from a notion of the marketer as a "mixer of ingredients." The marketer plans various means of competition and blends them into a "marketing mix" so that a profit function is opti-mized, or satisfied. Eventually the Four Ps of the marketing mix – prod-uct, price, promotion and place – re-ferred to as "the holy quadruple of the marketing faith written in tablets of stone" (Kent, 1986) became an indis-putable paradigm in academic re-search, the validity of which was taken

for granted. The marketing mix was regarded as core decision variables which are all interrelated and had to be effectively and efficiently managed to satisfy cus-tomers and organizational goals. Mar-keting mix management with its four Ps is reaching the end of the road as a universal marketing approach. How-ever, even if marketing mix manage-ment is dying as the dominating mar-keting paradigm and the Four P model needs to be replaced, this does not mean that the Ps themselves, and other concepts of the managerial ap-proach such as market segmentation and indeed the marketing concept would be less valuable than before. Typically managing the marketing mix meant relying on mass marketing, and therefore customers become numbers for the marketing specialists whose actions therefore are based on infor-mation obtained from market research reports and market share statistics. These marketing specialists, working in a marketing department would be alienated from the customers and not so infrequently such marketers acted without ever having encountered a real customer but an interest in turn-ing anonymous masses of potential and existing customers into interactive relationships with well-defined cus-tomers is becoming increasingly im-portant. Crosby, Evans and Cowles, (1990) and Zeithaml et al., (1985) have all noted the importance of personal interaction in creating satisfied cus-tomers. Successful exchanges can continued on page 8

Volume 7, Issue 2

Service strategies for a global brand in a developing country context: a case study of Caterpillar in Ghana By Robert Hinson, MCInst.M, MCIM and Daniel Ofori

Robert Hinson

eventually lead to an enduring buyer-seller relationship provided they are properly managed from both buyer and seller perspectives. In some ser-vice contexts, buyers face considerable uncertainty about the outcome of the service due to factors such as intangi-bility, complexity, lack of service fa-miliarity, and long duration of deliv-ery. The desired relationship quality from the buyer's perspective can be achieved through the ability of the salesperson to reduce any perceived uncertainty, knowing fully well that future sales opportunities depend mostly on relationship quality. Strategic service dimensions Technology In services marketing, high-tech may be applied in two phases: technology in service production and technology in service delivery, i.e. electronic chan-nels. The two phases are often inter-woven with each other. Service pro-duction must to a large extent be auto-mated before service providers can take advantage of electronic channels, as it is futile to deliver services through electronic channels if they have to be handled manually at the other end. From the strategic perspec-tive, one of the main reasons for using technology is to make service opera-tions more profitable and more feasi-ble. This is largely achieved by stream-lining and reorganizing back-office functions. In spite of several success stories in utilising high-tech in service production and delivery, technology also brings disadvantages. Many service providers cut costs by replacing human faces, but new tech-nology may reduce the perceived ser-vice quality in the eyes of customers and, as Cunningham (1995) argues in the case of insurance, increase the workload of the remaining personnel. Electronic channels especially, keep

customers away from the service facili-ties and at arm’s length from service per-sonnel. In such a situation, the outcome of the service act remains very impor-tant, but the process of service delivery may be of little interest, since it is invisi-ble to final customers. The advantage of electronic channels lies in their ability to provide updated information quickly ir-respective of time or place and at a low cost. Service encounter Service encounter focuses on face-to-face interactions between customers and personnel in a service setting, and in many cases interaction is a major ele-ment of the service offered. Grönroos (1982), transferred the concept of inter-active marketing to services with the aim of covering the marketing impact on customers during the service consump-tion process, when customers interact with various service systems, such as physical resources and personnel The customers' role as producers in the ser-vice encounter makes service unique, and therefore they have to be viewed as an integral part of the process. Blois (1989) suggests that customers' percep-tions of a service are tightly linked with personnel. If this is correct, the way cus-tomers perceive service encounter and how service production and delivery are organised cannot be considered in isola-tion from each other. This gives support to the idea of Quinn and Paquette (1990) about well-run service providers obtaining both optimal flexibility at the customer contact point, and maximum "production" efficiencies when design-ing their systems.

Service design Services are difficult to describe and communicate because they are intangi-ble, and when services are delivered over a long period their complexity increases and they become even more difficult to describe and define. (Zeithaml and Bitner, 2000). Further because services are delivered by em-ployees to customers, they are hetero-geneous. Rarely are two services alike or experienced in the same way. These characteristics are therefore the heart of the challenge involved in de-signing services. Shostack (1992) pointed out four risks of attempting to describe services in words alone, namely; oversimplification, incom-pleteness, bias interpretation and sub-jectivity and suggested services blue-printing as a way to address these chal-lenges. Service quality For services, the assessment of quality is made during the service delivery process, and each customer contact is referred to as a ‘moment of truth’; an opportunity to satisfy or dissatisfy the customer and many services are deliv-ered over several moments of truth or encounters between service staff and customer. Customer satisfaction with a service can be defined by comparing perceptions of service received with expectations of service desired. The literature to date has focussed heavily on service quality performance and measurement and it is widely ac-cepted that customers compare the service they expect with perceptions of the service they receive in evaluating service quality (Grönroos, 1982; Parasuraman et al., 1985). Parasuraman et al.'s (1985) widely accepted ‘four gaps model’ indicates that consumers' continued on page 9


service strategies for a global brand in a developing country context ………...continued from page 7

Many service providers cut costs by replacing human faces, but new

technology may reduce the perceived service quality in the eyes of

customers and, as Cunningham (1995) argues in the case of insurance,

increase the workload of the remaining personnel.

quality perceptions are influenced by a series of distinct gaps occurring on the marketers' side. An effective tool for surveying customer satisfaction based on the service quality gaps is the SERVQUAL, which predicts that cus-tomers will evaluate a service favoura-bly as long as their expectations are met or exceeded, regardless of whether their prior expectations were high or low, and regardless of whether the ab-solute goodness of the (service) per-formance is high or low (Buttle, 1996). Three components of service quality; technical, functional and reputation quality, have been identified by Gron-roos (1982). Technical quality is con-cerned with the outcome of the service encounter, Functional quality is con-cerned with the process of service de-livery Reputational quality is a reflec-tion of the corporate image of the ser-vice organization. Management competences for services marketing It is argued here that the competence of service managers is of crucial im-portance, given the nature and charac-teristics of services. In particular, the intangible aspects of services and the fact that services entail simultaneous production and consumption creates different challenges for managers. These characteristics increase the im-portance of identifying the specific competences which are most appropri-ate to managing in a services context. Improving quality in services manage-ment performance and activity has for a long time had prominence and the emphasis has traditionally been on cre-ating formal standards, procedures, systems, and techniques to "control" the service delivery; and measuring ser-vice quality performance in terms of customer perceptions and expecta-tions.

Clearly, there is no single set of compe-tences which are applicable to all mana-gerial jobs, or can any one managerial job be fully described by a set of com-petences. However, there is substantial agreement among management educa-tors that managerial competences can be identified (Albanese, 1989). Some competences, such as knowledge and experience in the technical aspects of services marketing activity, can be de-scribed as fundamental or basic compe-tences on which expertise is developed over time and these become the basis for other services marketing specific competences.

Services marketing management com-petences of knowledge, experience and distinctive expertise need to become even more refined and specific in a ser-vices marketing situation. The charac-teristics of services and the nature of the customer relationships in service contexts mean that the issues for ser-vices marketing managers need to be addressed in a different way than in a traditional manufacturing or goods marketing context. For example, ser-vices marketing situations depend more heavily on managing the "process" or "act" of the service product than does marketing in other situations. Because people are involved in performing ser-vices, and are not always consistent in their performance, standardization and quality are extremely difficult to con-trol. The effectiveness therefore, of a ser-vices marketing operation will depend on the quality of the management of people and personal encounters, such

as the customer-staff interactions in all areas of marketing activity. Distinctive expertise is required in relation to both technical expertise, such as possessing the specific skills or ability to do a job, and managerial expertise, which calls for the ability to manage a situation, facilitate the process and allow the ser-vice to happen. As the customer is in-volved in the whole delivery of the ser-vice product each member of staff must be encouraged to develop his/her distinctive expertise. It is generally agreed that managing in a services mar-keting situation is different from man-aging in a goods marketing situation chiefly because of the distinguishing characteristics of services: intangibility, heterogeneity, perishability and insepa-rability. Lovelock (1983) considers the implications these characteristics have on the services marketing manager's responsibilities and tasks and he de-scribes the key differentiating factors as: ⇒ the nature of the service act - it is a

performance and not a physical good,

⇒ the types of relationship service organizations have with custom-ers, that is, anything from having no formal relationships to a mem-bership requirement,

⇒ the scope of customization and the level of judgment required from the customer contact person-nel in the service delivery,

⇒ the nature of demand for the ser-vice, in relation to the effect fluc-tuations of demand and supply constraints may have on the ser-vice provision,

⇒ how the service is delivered, that is, whether it is face-to-face or at "arm's length," and,

⇒ the attributes of the service prod-uct, in particular whether it de-pends on people-based or equip-ment-based attributes.

continued on page 10

Volume 7, Issue 2


Some competences, such as knowl-edge and experience in the technical aspects of services marketing activity, can be described as fundamental or

basic competences on which expertise is developed over time.

These differentiating factors have the effect of creating specific require-ments of managers in a services mar-keting situation. In addition, when ser-vices need to change to meet changing requirements or when new services enter the market, new standards of performance may be needed and the quality of management decision mak-ing will become vital for competitive success. Gilmore and Carson, (1996) observed that distinctive expertise competences will be based on knowl-edge of the job, experience in the in-dustry and the development of spe-cific expertise in a particular area of services management. Progressive de-velopment of competences over time from basic knowledge and experience to achieve distinctive expertise clearly are important for effective services marketing decision making. Justification for the study The service marketing literature is re-plete with studies on service quality, ser-vice support, service marketing and ser-vice positioning in a multiplicity in in-dustries by way of empirical studies. Several theoretical papers have also been written in this regard. Some classics in this area include papers on a “Service Oriented approach to Sevices” (Gronroos, 1978), Hubbert; et al, (1995), Pratt, Keith T (1994), Ar-mistead, Colin; Kiely, Julia (2003). No paper in the services marketing literature has however investigated peculiar ser-vice support strategies in respect of global brand in a developing country context. This paper is positioned to fill that gap. Method Questionnaires were administered by fieldworkers specially recruited by the researcher for this study. A training session on services marketing and the Caterpillar Brand was organized for these field workers and they were taken through sampling selection pro-cedures, interviewing techniques and a

thorough review of the questionnaire. Fieldwork started on 6th February 2004 and was completed by 7th March 2004 within the normal working hours of the Caterpillar in Ghana. Questions were strictly answered by Head of the Heavy Equipment Division of Cater-pillar and all the Caterpillar Marketing Team personnel numbering seven. Data were collected by means of a questionnaire. In all 25 service encoun-ters were witnessed and a question-naire was also answered by the Cater-pillar Management Team. The ques-tionnaire comprised both structured and unstructured questions. Questions covered the history of the Caterpillar brand in Ghana, service support strate-gies and service differentiating strate-gies. The impact of technology on ser-vice delivery was also touched upon as well as issues that had to do with geo-graphical coverage and its impact of service leadership. The excellent execution of the field-work was greatly facilitated by the groundwork put in place by the Head of the Heavy Equipment Division of Caterpillar who contacted the other management team members and in-formed them about the impending re-search. Data were collected in the last quarter of 2003. Results Tractor & Equipment (T&E) is a trad-ing company specializing in the sale and servicing of Caterpillar Construc-tion and Mining Equipment, with a very long history in Ghana. T&E has been the sole dealer for Caterpillar equipment in Ghana for over sixty years. The company is one of six Cat-erpillar dealerships in Africa that be-long to the Mansour Group.

facturer of construction and mining equipment, diesel and natural gas en-gines and industrial gas turbines. The company is a technology leader in con-struction, transportation, mining, for-estry, energy, logistics, electronics, fi-nancing and electric power generation The product line of Caterpillar that T&E deals in are mining, construction, forestry, material handling and electric power generation equipment. Caterpil-lar has a network of 220 dealers, almost all of them independently owned, and sells products into nearly 200 countries. T&E has four branches in Accra, Ku-masi, Takoradi and Tarkwa and a Parts depot in Obuasi. The Accra office also doubles as a head office. The map overleaf gives a graphical picture of the location of the various branches of the company in the country.

Over the past three years, a lot of physical developments have taken place in all branches. Some major invest-ments include; the construction of the new Tarkwa branch with the sole ob-jective of serving the mining companies in the western region, and the improve-ment of the workshop and spare parts warehousing facilities in Accra, Kumasi continued on page 11


Page 1 0 The Market ing Chal lenge

and Takoradi. These investments have all been undertaken with the view of improving the company’s competitive-ness and also enable the company serve its customers better by offering good after-sales service. In the construction and mining equip-ment industry organisational buyers are mostly preoccupied with having their equipment operational when needed with very minimal or non-existent down times. Since problems are bound to occur when the equip-ment is used, how vendors deal with these problems and handle customer complaints goes a long way in estab-lishing and consolidating the corpo-rate identity of Caterpillar. It also serves as a possible platform for a dif-ferentiation strategy. Technological advances and the Inter-net has created a service demand sce-nario where customers no longer use price as the major consideration in choosing a vendor, especially when in the construction, mining, and other capital- intensive equipment. The em-phasis in this service marketing envi-ronment shifts to product support and/or after-sales service from the vendor in question. This is because the productivity of the equipment is critical to the success of customers’ operations and continuous existence in business, and this productivity is dependent on the availability of the equipment. This point is especially critical in a Ghana where customers are extremely price sensitive. For the customer, owning the equip-ment is not the most important issue but the service or the “soft” side of the equipment purchase. Soft side re-fers to intangibles like vendor empa-thy, vendor expertise, vendor knowl-edge, and vendor reliability. With the pace at which technology is develop-

of high standard with regard to quality. Komatsu equipment, Volvo equipment, JCB equipment and others do not dif-fer much in quality from that of Cater-pillar. In selling tangible products, like the products that T&E deals in, ven-dors often find that the customer con-siders the services provided in conjunc-tion with the product more important than the product itself. After-sales service is very critical to the customers because of the cost implica-tions to customers when equipment breaks down. There are two types of cost that customers incur: fixed and variable cost. The fixed cost occurs regardless of the duration of the equipment downtime. These are the expense of parts and la-bour involved in repairing the malfunc-tion. This cost may include the cost of the entire repair process, including, for example the cost of parts, labour and travel to customer’s site if the field ser-vice team has to travel to the cus-tomer’s site to carry out the repairs. If the equipment is out of warranty, the cost is borne by the customer. Variable cost is dependent upon the duration of the equipment down time. This can be out-of-pocket expenses such as paying for idle workers, rental of equipment, payment of penalty due to delays in the execution of contract, the total loss of the contract, the op-portunity costs of diverting equipment, the production lost time, and most im-portantly of all—the loss credibility which though cannot immediately be quantified, is the bane of success in business The after-sales service offered by T&E can be grouped into support system-related strategies and reducing or mini-mizing customer risk strategies.

Support system related strategies The support system related strategy concentrates on the way services are provided. The strategy seeks to ad-dress improvement in system design or reduction in equipment repair times. Improved system response time Support systems normally respond slowly to equipment failure. It is to improve service response, that the company has branches in Tarkwa, Ku-masi Takoradi and Accra. The Tarkwa branch takes care of the mining indus-try in the town and its environs. The Kumasi branch is responsible for the customers in the Northern Sector of the country. Takoradi branch takes care of the Western and Central Re-gions and Accra Branch, the Eastern, Volta and Greater Accra regions. From these locations, the company is able to reduce the response time by reducing the travel time. For big min-ing firms like Ashanti Goldfields (listed on the Ghanaian British and American Stock Exchanges), the com-pany has engineers located at the cus-tomer’s site. With these branches and location of engineers at customers’ sites, the company has brought service closer to customer and has vastly im-proved response times. Secondly, T&E has a parts system that is managed by computer software on an IBM AS400 that links all the branches through a Wide Area Net-work, and also links T&E with Cater-pillar. This system facilitates the order-ing, monitoring and the receipts of all parts orders. It also enables the com-pany to do routine stock checks and forecast parts orders. Apart from the computer system, T&E also has put in place an effective parts distribution system. continued on page 12

service strategies for a global brand in a developing country context ……….continued from page 10

Volume 7, Issue 2 Page 1 1

For Inter-Branch parts distribution, T&E has a twenty-four hour dedicated transport system and for movement of parts between Caterpillar and T&E, the company receives six flights per week of parts, from Monday to Satur-day. These parts when received at the Ac-cra branch, are sent to customers within the branch’s area of jurisdic-tion, or transferred to the other branches for onward delivery to cus-tomers’ sites within forty-eight hours. To further facilitate parts delivery the company has parts sales representa-tives equipped with vehicles and mo-bile phones who handle customer re-quests, process customer orders and work with customers on supplying al-ternatives. Reduction in Equipment Repair Time To complement the reduced response time, T&E strives to reduce the equip-ment repair time. The company em-ploys skilled service technician and engineers who go through training regularly to equip them with the latest diagnostic technologies to enables them offer the right service the first time and promptly. The company has over forty adequately tooled field ser-vice vehicles that the field service teams use to provide on-site service to customers. T&E has also got well -equipped workshops at all its branches with the state of the art diagnostic equipment to facilitate the diagnosing of faults on customers equipment and the right tools to carry out the necessary re-pairs. With all these, the company will still not be able to reduce the repair time if the necessary parts are not available. T&E has four parts warehouses, one

over thousand parts line items totalling over US$20 million, making parts read-ily available and accessible. The company has a Service Exchange Programme, where the company keeps some complete components of the equipment like engines and transmis-sions which they swap with customers when they have to work on a cus-tomer’s engine or transmission. This considerably reduces the down time of the equipment.

Customer risk reduction or minimizing strategy T&E, with the help of Caterpillar, has designed services that reduce the cus-tomers’ risk. Among them are warran-ties offered by Caterpillar for new ma-chines. The standard warranties cover periods from six months to twenty-four months depending on the prod-uct. Extended warranties beyond these periods are also available but at a cost. Warranties reduce customers out-of pocket costs during the immediate post-purchase periods and also allays any fears that the customer may have regarding equipment reliability. T&E also offers service contracts to reduce or eliminate customers’ uncer-tainty over maintenance costs. The company has two service contract of-ferings: Preventive Maintenance Con-tract (PMC) and Maintenance and Re-pair Contract (MARC). The preventive maintenance involves scheduled preventive maintenance at

worry of maintenance and unexpected downtime away and gives increased assurance to the customer that the equipment will be available when it is needed. It helps the customer to plan the management of the equipment. In the case of the MARC, the com-pany is responsible for repairs as well as maintenance of the equipment. This requires that sometimes a technician would be stationed at a customer’s site to ensure that the maintenance of the equipment is done at the right time and the equipment is handled as ex-pected. T&E offers another product known as Scheduled Oil Sampling. (SOS). This involves taking oil samples and analys-ing the samples to determine wear rate, oil cleanliness, oil condition, oil contamination and the oil viscosity. By taking the oil samples regularly for analysis, the life of the equipment and productivity is optimised and down time is reduced. Equipment down time means cost to the customer, both fixed and variable cost. For heavy equipment like the Caterpillar equipment that T&E deals in, both costs are relatively high. This therefore makes after-sales a stra-tegic opportunity for gaining competi-tive advantage in the industry of heavy equipment dealerships. Caterpillar equipment is not the cheapest in the industry. It is normally about 20% more than the others in the industry. The equipment, however, is the leader in the market worldwide because of the reputation of Caterpillar as a good quality product manufacturer and the best in after-sales in the industry. continued on page 13


service strategies for a global brand in a developing country context ……..continued from page 11

Conclusion and recommendations Tractor & Equipment, using its strong after-sales service reputation, sup-ported by the superior quality of Cat-erpillar products, is the market leader in the industry in Ghana. The latest deal that the company has been able to secure is a contract worth about US$60 million with Goldfields Ghana to supply and manage a fleet of mining equipment. T&E won the deal not just because of the Caterpillar products that the company sells, but also be-cause of the infrastructure and logis-tics that the company has put in place over the years to enhance the com-pany’s ability to provide the required after-sales service. After-sales service has given T&E competitive advantage over others in the industry in Ghana. The company considers after-sales service a strategic opportunity and not a necessary evil. It is evident therefore that: ⇒ Global brands will enjoy service

success in the deployment of the right service support strategies in a developing country context.

⇒ Service leadership can facilitate market leadership as evidenced by the case of Caterpillar in Ghana

Limitations of the Study Recommendations will be strength-ened by further research in respect of other global brands again in a develop-ing country context to firm up the above generalisations. Indications for Future Research Future research should focus on ⇒ Large macro studies on service

support for global brands in Ghana

⇒ The link between service leader-ship and market leadership in Ghana

References A Service-Orientated Approach to Marketing of Services Gronroos, C. European Journal of Mar-keting; Volume 12 No. 8; 1978 Albanese, R., 1989, "Competency-based man-agement education", Journal of Management Development, Vol. 8, No. 2, pp. 66-70. Baruch,J. J., Paquette, P. C., and Quinn, J. B., (1987), “Scientific American”, Vol. 257, No. 2, pp. 50. Buttle, F., (1996), “SERVQUAL: Review, cri-tique and research agenda” European Journal of Marketing, Vol. 30 No. 1, pp. 8-32 Creating strategies for managing evolving cus-tomer service Armistead, Colin; Kiely, Julia Manag-ing Service Quality; Volume 13 No. 2; 2003 Crosby, L.A., Evans, K.R, and Cowles, D, (1990), "Relationship quality in services selling: an interpersonal influence perspective", Journal of Marketing, Vol. 54, pp. 68-81. Fitzsimmons, J. A. and Fitzsimmons J. M., (2000) “Service Management: Operations Strat-egy and Information Technology, McGraw-Hill Fontenot, R.J, Wilson, E.J., (1997), "Relational exchange: a review of selected models for a prediction matrix of relationship activities", Journal of Business Research, Vol. 39, pp. 5-12. Gilmore A, and Carson D., (1996), “Management Competences for Services Mar-keting”, Journal of Services Marketing, Vol. 10, No. 3, pp. 39-57 Grönroos, C., (1982), “Strategic Management and Marketing in the Service Sector”, Publica-

tions of the Swedish School of Economics and Business Administration, Helsinki. Gronroos, C., (1990), “Service Management and Marketing” Lexington Books, Lexington, Mass., p. 27. Introducing a Service Level Culture Pratt, Keith T Facilities; Volume 12 No. 2; 1994 Kent, R. A., (1986), “Faith in Four P’s: An Alternative” Journal of Marketing Manage-ment, Vol. 2, No. 2, pp. 145-54. Lovelock, C.H., (1983), “Classifying services to gain strategic marketing insights”, Journal of Marketing, Vol. 47, pp. 9-20. Lovelock, C. H., (1992) “Managing Services: Marketing, Operations and Human Re-sources”, Prentice-Hall, Englewood Cliffs, NJ, 208-15. Parasuraman, A., Zeithaml, V.A. and Berry, L, (1985), “Problems and strategies in services marketing”, Journal of Marketing, Vol. 49, No.2, pp3-46. Sasser, E., Olsen, P. R. and Daryl, D. W., (1978), “Management of Service Operations”, Allyn and Bacon, Boston, pp 8 Service expectations: the consumer versus the provider Hubbert, Amy R; Sehorn, Annette Garcia; Brown, Stephen W. International Journal of Service Industry Management; Volume 6 No. 1; 1995 Quinn J. B., (1992),” The Intelligent Enter-prise – The Free Press, New York Robert Hinson is an EMBA Lecturer in Mar-keting at the School of Administration, Univer-sity of Ghana. Adelaide Nartey is an EMBA student in International Marketing at the School of Administration. Robert can be reached at [email protected]

service strategies for a global brand in a developing country context…………..……….continued from page 12


Global brands will enjoy service success in the deployment of the right

service support strategies in a developing country

context.

Service leadership can facilitate market leadership as evidenced by the case of

Caterpillar in Ghana

Clark & Rajaratnam (1999) predicted the 21st century will increasingly be the century of international services while Sharma & Roy (1996) shared the opin-ion that the globalization of national economies, internationalization of production, new forms of business organizations changed the business landscape in the 1990s. They are also of the opinion that such developments require us to understand their implica-tions on the management education. Management education is part of in-ternational education that Tim Maz-zarol (1998) argues to be one of the more significant services industries that emerged in the 1980s and 1990s while providing data in his work to illustrate that the contribution of inter-national education to the earnings of Australia had been tremendous and provided much employment at the same time. He further quotes similar situations for both the USA and Can-ada. The marketing of management educa-tion needs to focus on certain key fac-tors to ensure marketing success espe-cially in the current market scenarios where providers from across the world compete for this particular seg-ment of the education market that is deemed lucrative. Long gone are the days where an insti-

tution or a provider can just undertake limited or a reasonable level of market-ing activities and expect to see students streaming through their doors. The providers of management educa-tion need to ensure key areas such as the following examples are undertaken well. Internationalization activities Howe & Martin (1998) had the opin-ion that increased globalization of business had pressured university busi-ness schools in the UK, US and Aus-tralia to internationalize their post-graduate programmes. This is evident by the number of international pro-grammes by universities not only from the above mentioned countries but also by those in Malaysia and Singa-pore. They have now entered the inter-national markets, too. Recent world events such as the SARS incident in China had dealt a severe blow to tertiary institutions that de-pended on China as their largest source of students. Prior to the inci-dent, it is not uncommon to find prac-tically every tertiary institution dealing with international students focusing on China as their main market with some even relying solely on Chinese students with English language providers as a main example. Those who relied mostly on China stu-dents faced severe reduction in their number of students with some institu-tions folding up or operating below the

profitability levels. What really hap-pened was the classic case of ‘ putting all the eggs in one basket’. Sharma & Roy (1996) are of the opin-ion that there is a general consensus that the only alternative is for business education to internationalize. Management education providers need to internationalize their activities as much as possible to enable risk re-duction through spreading risks over more geographic areas while exploit-ing greater market potential. This will also mean moving into non-traditional markets for the providers. Howe & Martin (1998) expressed that there is a need to increase the cus-tomer base for management education due to the saturation and decline of traditional markets. Example New Zealand tertiary education institutions since the middle of 2003 have experienced a significant reduction in the number of interna-tional students that is due to the over-dependency on the China market in previous years. This situation has even made several institutions especially language schools experi-ence doubtful financial situations. However, at present some turnaround in the market is being expected in the year 2005. To address this, action was taken to move into other markets such as India, Eastern Europe, South America and elsewhere to tap alternative sources of international students. Together with this, intensive marketing ac-tivities are undertaken even by the Govern-ments in key markets. Internationalization does not relate only to the recruiting of international students but extends to areas such as undertaking offshore activities through offshore programmes and campuses, distance learning and fran-chising of programmes. continued on page 15

Marketing management education By Anthony Raman, M.C.Inst.M.


Anthony Raman

This is further supported by Cheng (1999) who says that there is trend in internationalizing education by export-ing programmes to fee paying students around the world. In support of his statement, Cheng cited the works of Cheng ( 1998 ), Peters et al (1997), Ca-vusgil (1993), Alexander & Rizvi (1993), Gillespie and Collins (1986) and others that have documented such a trend. He argues that institutions from school through university levels have been driven by a combination of mar-ket forces, government policy and aca-demic initiative to incorporate many of the common features of interna-tionalization that can be broadly classi-fied into the following categories: cur-ricular changes to incorporate interna-tional and cross-cultural elements, the movement of students and staff across international boundaries through visit-ing or exchange study programs, and development of academic and com-mercial partnerships overseas for the delivery of teaching programmes. Customer oriented marketing activities The marketing activities need to be customer-orientated and with the per-sonal touch, while being supportive to the marketing activities of their part-ners and agents in their various over-seas markets. The marketing activities undertaken must employ tailor-made strategies to suit the particular markets that are ag-gressive with a dedicated budget from management to keep up with the level of market practice and competition. The providers should have a cus-tomer-oriented service culture as men-tioned by Gronross (1990). It is im-portant for management education providers to realize this to provide

customer satisfaction. It is widely acknowledged that success-ful organizations need to have a cus-tomer oriented business culture (i.e., Athanassopoulos 2000; Deshpande, Farley and Webster 1993; Houston 1986; Parasaruman 1987; Shapiro 1988, F.E. Webster 1988 )

This is further stressed through the work of Zeithmal et al 1992 that sug-gest that one of the prime issues of poor performance by service firms is not knowing their customers expecta-tions. Perception has an impact on ser-vice quality and expectation. Service quality Meeting customer expectations as well as those from other countries is vital. Management education essentially re-quires services marketing. Erikksson et al (1999) state that service quality is defined as conformance to requirements between buyers and sell-ers. They cited Gronross ( 1990), Parasuraman et al (1985) and Gum-meson (1993) when mentioning that service quality include process aspects such as responsiveness, including de-livery and outcome aspects such as availability and punctuality. There is a great need for management education providers to undertake greater research to identify not only the market needs and expectations but also of their partners and agents while taking heed of competitive moves by organizing strategies to deal with such. This research will enable them to have greater market orientation.

Eriksson et al (1999) argue that a cru-cial competitive factor for the posi-tioning of service firms to operate competitively in international markets is the ability of supplying high service quality. They further argue that to the best of their knowledge, earlier studies of international operations of services did not deal with service quality in in-ternational markets or considered the connection between foreign market entry mode and service quality. They referred to the works of Carman & Langeard (1980), Erramilli ( 1990), Erramilli & Rao ( 1990,1993), Gron-ross ( 1990 ), Sagari ( 1992 ), Sampson and Snape (1986), Vandermerwe and Chadwick (1989). DiDomenico and Bonnici ( 1996 ) ar-gue that a feature that differentiates many universities is service and insti-tutions of higher education should measure their service quality, to func-tion efficiently and effectively in a highly competitive environment. They cited Barrett & Greene ( 1994) who are of the opinion that an institu-tion is likely to acquire a competitive advantage if it delivers better quality education against the fees it charges. Service quality is vital for an educa-tional institution when seeking a com-petitive advantage in international markets. Furthermore, the service quality that they seek needs to be based on their target markets needs and requirements. Finding out what their target market feels is vital. As management education providers must identify their market’s expecta-tions and work towards meeting them to get them to perceive their service quality to be satisfactory. They need to identify such expectations to provide the level of service quality required. This calls for a marketing orientation by such institutions. continued on page 16

Marketing management education…………………….continued from page 14


It is widely acknowledged that successful organizations need to

have a customer oriented business culture

As argued by Ford et al ( 1999 ), com-panies need to adopt a marketing ori-entation to differentiate themselves from competition due to intense com-petition. However, they mention that such marketing orientation focus is reluctantly being adopted by service industries especially in higher educa-tion. They argued the need for educational institutions to undertake an assess-ment of their target markets needs, modifying their offerings to meet such needs and as such enhancing the per-ceived quality of the service they pro-vide. Mr. Raman is the International Liaison Director (Asia Pacific) Te Wânanga o Aotearoa (TWOA) — The University of New Zealand and lectures in marketing. He can be contacted at [email protected].

Eleven years ago, on April 19th, 1993, a little after mid-day, smoke was seen in the Mount Carmel Ranch in Waco Texas, which soon turned out to be a ferocious blaze, the compound at the center of a 51-day stand-off between the FBI and David Koresh and his Davidian cult. Koresh, who traveled to the Mount Carmel compound in 1981 and went on to become the sect's leader, perished in the blaze with 74 followers, including 21 children. This was the tragic end to a “cult brand” where David Koresh was the “brand” his followers were willing to make the supreme sacrifice for. “Cult brands” have always fascinated the writer, and in an ideal situation many marketers would want their cus-tomers to be loyal to their brand as were the followers of David Koresh. Imagine you at Pennsylvania's Pocono Mountains, on a radiant afternoon for an outdoor wedding, listening to Rever-end James S. Massie Jr. who looks out over 250 love-struck people assembled for a mass ceremony. After reading the vows, Massie, an Episcopal priest, takes a deep breath and leans toward the mi-crophone: "By the power vested in me, I pronounce you-car and driver." Strange, but true! A bunch of people


has just married their Mazda Miatas. These people live for the $21,000 roadster, and Massie eggs them on. When he's not praising the Lord, he's whipping around the roads near his home in Olcott, New York in his white 1996 Miata, the Hallelujah cho-rus blaring over his CD player. "It's not just harmless fun," says Massie, "It's a spiritual endeavor." Like followers of David Koresh used to gather at Mount Carmel and people making pilgrimages to shrines, as many as 85,000 Apple Computer fans make a pilgrimage to the MacWorld expo, the annual four-day event at San Francisco's Moscone Center. It's a chance to check out the latest devices and products and, more important, to "touch" Steve Jobs-even if only by viewing him on a giant screen-the man who democratized technology by put-ting computing power in the hands of ordinary people. Geeks, musicians, and artists pack the hangar-like ball-room for the highlight of the show, Job’s speech, and they cheer his every word. In comparison to the Davidian cult, like the Miata, and Apple cults, you may find many more examples from today’s commercial and business world where consumers are doing the extra-ordinary to show their loyalty to the brand they use, adore and hold in high esteem. Harvard Business School’s marketing conference last year revealed such instances of “Cult” status achieved by brands. Frances Britchford, Vice President of Innova-tion for Pepsi Co. was quoted on cus-tomers of Mountain Dew saying continued on page 17

Marketing management education………….continued from page 15

Books on branding Finding books on brands is not diffi-cult. Finding high-quality books on brands is. Below are a selection of ti-tles that can really help you get to grips with the issues surrounding branding. Nicholas Ind oversees contributions from the great and the good on branding in his superb book, Beyond Branding, which has as its theme brand integrity and transparency. Kevin Roberts, Worldwide CEO of Saatchi & Saatchi, in his book Love-marks, argues for brands that people are passionate about and that become part of their lives. Also excellent is Alan Mitchell’s Right Side Up, which analyses the shift from a seller-centric world to a buyer-centric one, and the implications this has for marketing and brands.

Do you have the nerve to create a cult? By Rasika Wickramatunga, MBA, Chartered Marketer, MCIM (UK), MCInst.M, CPM (Asia Pacific), MSLIM

Rasika D. Wickramatunga

“when you get young people who drink a six-pack of your high-sugar, high-caffeine beverage every day; you know you've got a cult brand.” Also when three sets of different par-ents who are avid ESPN sports chan-nel fans, name their babies Espen, Espn, and Espn (again!), respectively, you know you’ve achieved a different level in a customer’s mind. And also when your customers become highly emotional when you change the color of your logo. This actually happened to Apple Computers after it changed the color of its multicolored apple logo to solid red. “Some of the origi-nal Apple logos are now bought and sold on the online auction site eBay,” says Phil Schiller of Apple computers. Schiller, Apple's Senior Vice President for worldwide product marketing ad-mits that cult brands inspire great pas-sion in their followers, and that can lead marketers into a non-stop balanc-ing act. "There are strange people out there and they seem to have a person-ality that has a strong affinity to attach to things like cults. And you have to deal with those people because they are your customers. You have to care about your customer. I get 300 e-mails a day, and I have to respond to every one. Some of the customers are screaming and swearing and angry,” exclaims Schiller. "What you find is the cult/fetish cus-tomer is more passionate and there-fore contacts you when he or she is most upset. So you get a lot of angry customers who feel they have the right to fight for their brand and [that] it's something bigger than any one person and any one company, and they're fighting with their passionate views. You have to deal with their rage and accept it and be proud that the reason you're getting this hate mail with screaming and swearing is because

group's bad -boy image resonated with middle America. Today, with sales of $2.9 billion and a 25% market share in the United States, Harley is one of the few brands to have maintained a cult status as it de-veloped a mass market. "I'm very into the Harley myth," says Alvin LaSalle, 63, an electrical contractor in Cathedral City, California, who has Harley's trademark wings and the word "Free" tattooed on his arm. And it's still the preferred brand for Hell's Angels, who supposedly use the Harley ‘owners manual’ as a bible in wedding ceremo-nies. Cult brands "dare to be different," ob-serves Matt Ragas, the co-author of “The Power of Cult Branding”. Cult brands sell lifestyles, not just a product or service, he writes. But cult branding is not a viable path for every company. "I would love to say it is, having writ-ten a book about it, but it's not. Most companies don't have the risk-taking mentality. In cult branding, the man-agement and marketers behind it are willing to take big risks and they un-derstand the potential pay-off," adds Ragas. Ragas in his books identify a few spe-cial brands that have taken popularity to a different level, altogether. The so-called cult brands include Harley-Davidson, Star Trek, Volkswagen, Ap-ple Computer, and many more. Even Oprah Winfrey is a brand, and a cult brand at that claims Ragas. continued on page 18

they love your product, they love your brand," comments Schiller. Mazda had to pay dearly, when it re-designed the cup holder in the Miata in 1998. Drivers complained so bit-terly about its position in the center of the console that the automaker changed it in a later model. "These people are psycho," claimed Frederick Aikins, Mazda's manager of product communication. Now, when a modifi-cation is on the drawing board, Mazda tests it with customers first. And the Miata will never sell to the masses. Mazda sold 18,299 Miatas in US alone, last year. Cult Brands have re-defined customer loyalty. It’s not about just having cus-tomers these days; you’ve got to have loyal fans. Your customers mustn’t just love your product; they must have an emotional bonding with it. All this hype on creating “niches” has lead the most successful businesses today to think of their customers in a new way. Why are consumers crazy over such cult brands?. "We all need to be part of something larger than ourselves," says Robert Jay Lifton, a psychiatrist and author of The Protean Self: Human Resilience in an Age of Fragmentation. "If you're part of, say, Harley-Davidson, you can feel that this movement has existed before you were born and will continue beyond your finite life span." Harley Davidson is a classic example of a “cult brand”. The 100 year-old motorcycle maker in Milwaukee, Wis-consin, didn't really take off until dis-engaged World War II veterans came home and took to the road on the powerful macho bikes. The most loyal consumers formed an organization named for the 303rd Bombardment Group, aviators who flew missions in France and Germany-the Hell's An-gels. The outlaw group helped boost the bike's exposure. Its members were hard to miss on highways-and occa-sionally popped up in the news be-cause of criminal activity. Still, the

Volume 7, Issue 2

create a cult ..continued from page 16

create a cult ..continued from page 17


Mathew Rocks, Editor, Real Business writes of six ways in “Cult” creation, which is very interesting and an eye opener to us, practicing marketers. Customers of cult products feel as if they’ve discovered something. If some-one you admire or hold in high esteem says, “ you should go to this place,” or “you should try this thing,” which really push your urge to be associated with that place or thing, it is worth more than a million rupees of advertis-ing spend in mass media. Most cult brands have a feeling of “authenticity” about their offering. Charlie Marshall and Sebastiano Petrilli., the team behind “Primal Soup” formed their wholesale and re-tail soup business in 1999. Today, their soups are on sale in hundreds of out-lets across the UK and consistently beat similar competing products in blind tastings. “Primal” soup lays great emphasis on its origins and its values. “We pinpoint exactly where our vege-tables come from,” says the firm’s co-founder Sebastiano Petrilli. “We make big play of the fact that we get our in-gredients from Italy and we have trucks coming up from Italy every week to the UK, filled with the fresh-est ingredients – the type you can imagine buying on holiday.” Real Busi-ness quoted Charlie Marshall. You find an intimate involvement be-tween a cult brand and it’s consumer. UK’s Restaurant Personality of the Year 2002, Bangladeshi born Iqbal Wahhab of “Cinnamon Club” has a message at the bottom of each bill, personally signed such as, “did you know we did breakfast?” or, “how about giving away one of our gift vouchers?” The messages and his sig-nature also feature prominently on the restaurant’s Web site. What about our own tea magnate, Merrill J. Fernando of Dilmah, who has made his brand

number 3 in the world of tea brands dominated by Lipton’s and Tetley’s. Each of Dilmah tea pack will carry Fernando’s personal message “One CEO who makes his own tea, he guides his family business with pride, passion and care. You can’t buy that”. Nothing like a personal assurance from the person involved with the business showing his commitment and passion towards what he or she offers. Cult brands are daring. They do things differently and are assured of a loyal customer following at their every move. A good case example is the new raving sex goods shop “Myla” run by Keith Wallace, turning sex toys into the next big retail thing. Much adver-tising is geared towards sex (even though the products themselves are clothes or perfumes or beauty prod-ucts). The idea behind the designer sex brand Myla, says Wallace, was to say, “this is about sex.”

The sex trade has long had a sleezy image. The challenge for the founders Charlotte Semler and Nina Hampson was to make it luxury, aspirational, and beautiful. “Men are intimidated by pink, phallic-looking objects,” says Wallace. After initial market research, the founders of Myla gave their de-signers Tom Dixon and Mark Newson the brief: design the best sex toy that you think you could possibly design. But it shouldn’t be phallic in shape. “This was an unchartered design area,” says Wal-lace. True cult-products feel distinctly, genuinely and radically new. At the peak of the move towards “organic products,” Primal Soup declared that organic was passé. “We were very ar-rogant and very small and we wanted to cook differently. We had the cour-

age to say, we are not organic, we are primal,” Sebastiano Petrilli , co-founder of Primal Soup business is quoted in Real Business. “Primal means many things. It means using ingredients that are in season and grown under the sun; it means knowing the origins of your supplies; and it means great food. We don’t care if the food is organic or not. We go for taste,” says Marshall the other co-founder. “These days, much organic food production is dominated by huge greenhouses. It’s all machinery,” says Petrilli. “There’s no sign of the farmer who sweats and hopes it is going to rain at the right time.” True cult brands throw back the ques-tion at their customers; “Have you thought about it in this way?” The customer’s response would be an em-phatic “No”. Take a look at the local example of “Kithul Cup” and “Pani Kadju” ice creams. Aren’t they radi-cally new? Then, the cult brand’s most central characteristic is that “it’s not for eve-rybody.” If it’s for all and sundry would it achieve cult status? Cult products thrive on scarcity and exclu-sivity. This poses the question back to marketers. “Do you want to sell a little at premium prices or do you want to sell a lot?”. Many companies answers this by having different price points to different products. “Myla isn’t an ac-cessible brand,” says Wallace. It’s a defiantly high-end product. “You do not want it to be accessible to every-one because of course then it does not become cult, then it becomes main-stream.” True to these words, most cult brands like Harley Davidson will have the scarcity and exclusivity, which makes them unique. Supply is restricted and therefore the prices are high. continued on page 19

Cult brands are daring. They do things differently and are assured of a loyal customer following at their

every move.

Smart firms regard their cult brands as an asset and never rest on their laurels, realizing that even a brand people love in its present form has got to grow and change to survive. Adds author Ragas, "All these brands help give people an identity. People like to be different. At the same time, they would like to be part of a group that acts different. Cult brands hit on that fine line." Cult brands will make companies fo-cus on their customer more and al-ways try to out-smart the customer by offering something novel. Thus cult brands are a mixed blessing. They're great for launching a new business on the cheap. Everyone wants ardent consumers. But they can be a huge impediment to growth if a company decides it can't afford to alienate core disciples. So, it finally boils down to a firm’s ability to be different and its nerve to stand up to the expectations. For the ones who don’t have that nerve — be a mainstream brand, please! References: Melanie Wells, Cult Brands, Forbes Magazine, Jan 04 Martha Lagace, Cult Brands, HBS Working Knowledge, Dec 02 Matthew Rock, Six laws of cult creation, Real Business, Jul 03 Rasika D. Wickramatunga, has an MBA from University of Sri Jayewardenepura. He is the Head of Sales & Marketing at Bogawantalawa Plantations Ltd. a premier Tea Plantation and Marketing company in Sri Lanka, and has over a decade of ex-perience in marketing with both leading FMCG and Service organizations. He has been a volunteer member of the Execu-tive Committee of CIM Sri Lanka Branch for over four years and is presently the Membership Development Officer. He can be contacted on [email protected]

“The purpose of Marketing is to iden-tify, create and sustain competitive ad-vantage and drive a business to sell more goods, services or ideas to target markets at profitable prices”. Madanayake R. (2002). Strategic Marketing Plan – The 12 ‘P’ Model, Sarvodaya Vishva Lekha, Sri Lanka. How do we identify, create and sustain competitive advantage? “Marketing is a management proc-ess to identify, create, sustain and grow customers by providing supe-rior value at profitable prices”. Ra-man, Madanayake & Raghunath. (2003). The Mar-keting Collectibles, Baron Press, New Zealand.

The task specific marketing tool to achieve competitive advantage is pro-viding superior value over and above other options. Why else would a cus-tomer want to acquire or change the brand the customer is now using for another? That brand or the alternative must provide superior value and de-light that particular customer. As far as the customer feels that the brand or option provides superior value and continues to delight, the customer will remain loyal but the slightest disap-pointment thereafter will make the customer migrate to enemy territory – the competitor’s product. What mar-keters must realise is that customers are fickle; if they are unsatisfied with what they use they will look for satis-faction elsewhere, perhaps even ‘divorce’ the product or service they

use completely, for a newfound supe-rior value. This leads us to the important conclu-sion that the core principle of market-ing is about satisfying customers’ needs and wants by providing superior value. Therefore marketing is a customer fo-cussed business philosophy, or in other words, a market-oriented management process. A cluster of customers forms a market, a market is people who have needs to satisfy, the willingness to buy and the ability to buy. In a modern world where consumption has moved from the commodity stage to a branded stage for almost all products and ser-vices the significance of marketing be-ing market focussed is of paramount importance where every move of the marketer must be market centred. If this hypothesis is accepted; is there room for any organisation to deviate and change focus elsewhere to the product or brand marketed by it? If the answer is no, as it must be, we see a serious anomaly! We have lived with this anomaly for many decades. This anomaly is what we refer to as brand management, which evolved through product management from the decades of the past. I think it is marketing’s most unfortunate myopia. How can a product oriented, a product driven and a product focussed discipline such as brand or product management fit into a market focussed and market centred philosophy and management process? The answer to this will be found in the same old story of ‘keeping to tradition’. The inside the box phenomenon. Brand Management Brand management defines the brand manager as the custodian of the brand who is responsible for the pre-launch,


create a cult ..continued from page 18 Brand management myth By Dr. Ranjan Madanayake, DBA, CPM, FSPMgt., FSBP, FInst. SMM, MCMI, MCInst.M, MIM (SL), MSLIM

Ranjan Madanayake

0 The Market ing Chal lenge

brand management myth ……………………..continued from page 19

launch, growth, maturity and decline stages of the PLC. A brand may have one product or several products or one category of products such as ready to drink fruit juices of different fruits with one brand. Hence it will have Brand X Mango, Brand X Pineapple, and Brand X Papaya. This demon-strates the strong brand, product or category focus. Tasks of product and brand managers • Developing a long range and com-

petitive strategy for the product • Preparing an annual marketing

plan and sales forecast • Working with advertising and mer-

chandising agencies to develop copy, programmes, and campaigns

• Stimulating support of the product among the sales force and distribu-tors

• Gathering continuous intelligence of the product’s performance, cus-tomer and dealer attitudes and new problems and opportunities

• Initiating product improvements to meet changing market needs

Kotler P. (2003). Marketing Management. 11ed. Prentice-Hall of India.

In the above edition Professor Kotler also states, “Brand managers are not given enough authority to carry out their responsibilities. They have to rely on persuasion to get the cooperation of the other departments. They are told they are ‘mini-presidents’ but are often treated as low-level coordinators. Product and brand managers become experts in their product area but rarely achieve functional expertise. They vac-illate between posing as experts and

being cowed by real experts. This is unfortunate when the product or brand depends on a specific type of expertise, such as advertising”. Kotler goes on to say, “Today we be-lieve that the customer relation-ship, not the brand, is the primary lever for value creation”. Professor Kotler illustrates a switch from prod-uct managers to product teams as:Vertical product team – Product man-ager, associate product manger and product assistant where the product manager is the leader Triangular product team – Product manager and two specialised product assistants, one who takes care of mar-keting research and the other market-ing communications Horizontal product teams – Product manager and several specialists from marketing and other functions But the concept of product teams is also product focussed rather than market focussed. My bone of conten-tion is the fact that brand or product management in whatever way indi-vidually or team continues to be prod-uct focussed and not market focused. How do we remedy this? The only way to achieve this is by being market focussed and customer need or want oriented and this leads us to market management. Market Management In a customer centric environment what we need to do is manage markets and not products or brands or even categories. Therefore we need to shift from product management to market management. Consider the personal care market, those who want per-sonal care products or services. This market has been segmented further by behavioural aspects to skin care mar-ket and hair care market – as those who want skin care products or ser-vices and hair care products or ser-

vices respectively. These two segments can be further segmented according to geographic, demographic, psycho-graphic and behavioural aspects, pat-terns or wants. In the market place in Sri Lanka, fair-ness creams are a relatively new prod-uct category that is serving the skin care market and specifically those who want to be fairer. They have found this profitable niche within this mar-ket. The task of the brand or product or category manager of those compa-nies serving this segment is to get profitable market share for their brand, product or category. In this product focussed process the brand managers of all competing brands have completely forgotten that they are serving the skin care market. I say this because they have neglected the dark complexioned majority in the market. Persons with dark coffee col-oured skin will know that a fairness cream will not make them any fairer but they would like to use a cream to make their skin more beautiful – and have a glowing skin, a radiant skin and a healthy skin. My initial investigations point towards this possibility. Just as black is beautiful, there could be an opportunity for a brand ‘dark & beau-tiful’. The point is, if those brand managers were market managers in-stead, then they will be skin care mar-ket managers and when that happened they would be bound to see a cine-matic picture rather than a TV screen. continued on page 21

Product and brand managers become experts in their product

area but rarely achieve functional expertise. They vacillate between

posing as experts and being cowed by real experts


brand management myth ……………………..continued from page 20

Both screens are a must but in the for-mer (brand management) one would be restricted to a TV screen. When Roberto Goizueta became CEO of Coca Cola and found that Coke accounted for less than 2 ounces of the 64 fluid ounces that each of the world’s 4.4 billion people drank at that time he said that the real enemy was tea, coffee, milk and water and ush-ered in a huge period of growth at Coca Cola. Kotler P. (2003). Marketing Man-agement. 11ed. Prentice-Hall of India.

A market manager would have a mar-ket focus, hence would attempt to meet end users rather than marketing intermediaries that many brand man-agers turn to. They would realise that they must wait less in the comforts of their offices gazing at their laptops and notebooks and move their butts to where their customers are at the points of consumption, and less at points of exchange – the trade. I have seen brand managers who are males handling personal care products for females – it makes no sense. I knew a gentleman who was managing a brand of sanitary towels that never did well. I advised the company to employ a fe-male and the results changed dramati-cally. He is now in the liquor trade, and thanks me profusely for the initia-tive. The market management of skin care products depending on the volume of work that can be segmented demog-raphically as follows: • Market Manager Skin Care

– Female Adults • Market Manager Skin Care

– Female Teenagers • Market Manager Skin Care

– Babies

Additionally a behavioural segmenta-tion can be made as: • Market Manager Skin Care –

Treatments The above segment will address treat-ment for dry skin, and oily skin. The market manager in charge of the female teenagers would interact with them very closely and get more infor-mation and leads to dominate that seg-ment, as opposed to getting market share for a brand in the case of brand management. Thus the market man-ager would come with constant pro-posals to improve, innovate, and posi-tion products wanted by the respective market segments — and grow these segments to buy all or most of the company’s product portfolio. There-fore, market management has a broader perspective and wider oppor-tunities than brand management. I sin-cerely believe besides the positives of my initial research that market man-agement is the way to the future with globalizing becoming more and more important, and market management consequently, a necessity. I shall appre-ciate and value your comments and wisdom on [email protected]

Ranjan Madanayake is author of Strategic Marketing Plan – The 12 ‘P’ Model, Sri Lanka and Co-author of The Marketing Collectibles, New Zealand and Malaysia. He is a member of the International Academic Board, Phoenix International University, Managing Director, Phoenix Business School, Sri Lanka, and Marketing and Management Consultant, East West Mar-keting (Pvt) Ltd., Sri Lanka.

Members honoured for their work The Canadian Institute of Marketing is an organization of professional people working in a wide range of industries around the world. When some receive recognition from their peers and em-ployers, it is an event that highlights their drive to be the best. The Cana-dian Institute of Marketing is proud to have such high achievers in our midst. Lubaina Galely, MCInst.M., MCIM Lubaina was recog-nized as “Top Stu-dent for 2003" for both the ACS (Associate, Cus-tomer Service) and the PCS (Professional, Customer Service) examinations of the Life Insurance In-stitute of Canada, LOMA Institute. She scored the highest marks ever re-corded in North America. The award was presented at the 2004 Annual Conference held June 15 at the Metro Toronto Convention Centre. LOMA (Life Office Management As-sociation) was founded in 1924 by U.S. and Canadian insurers. LOMA is an international association through which more than 1,250 insurance and financial services companies from over 70 countries engage in research and educational activities to improve com-pany operations. LOMA members are involved in life and health insurance, managed care, annuities, pensions, banking, bank assurance, securities, and other financial services areas. Lubaina is an employee of Ontario Blue Cross

I sincerely believe besides the positives of my initial research that

market management is the way to the future with globalizing becoming more and more important, and

market management consequently, a necessity.

L. Galely, left


Honours………continued from page 21

Tossnarain (Shiv) Seechurn, MCInst.M., MCIM During National Public Service Week, June 13 to 19, Shiv Seechurn, Registrar and Vice President of the Canadian Institute of Marketing , was the only person who was awarded the Certificate of Excellence, at the Mississauga business centre of Can-ada Customs and Revenue Agency. Anthony Raman, MCInst.M Anthony Raman was recently made a member (Ballestero de Hermandad) of the Noble Company of Knights Arballisters (Crossbowmen) of Saint Philip and Saint James (Noble Com-pania de Ballesteros Hijosdalgo de San Felipe Y Santiago). The Noble Company was originally raised in the 13th Century in the town of Alfaro (Castille, La Rioja) in Spain. Belonging to the Noble Company is a sign of nobility and enables the mem-bers to use the style/title ‘Don’. The Honorary Chief of the Noble Company is H.M. The King of Spain, the chief being SAR The Prince Alvaro de Bourbon Duque de Galliera and the Commander – Marques de La Floresta. It is a rare honour for someone from the Asia Pacific region to be made a member of the Noble Company.

Professional services firms have hired marketing professionals to provide in-house advice on market strategies and to drive marketing efforts. To deliver successful marketing campaigns, mar-keters must harness fee earners to market the firm. The challenge facing marketers is to leverage and motivate the fee earners to attract and retain clients and hence provide income streams to the firm. To grow the business, or at least retain existing relationships, professional ser-vices firms need to not only embrace marketing concepts, but need staff to be empowered and understand their role in being advocates of the firm. In this way, they can act as champions and promote the firm and the benefits of their services. An important com-ponent of a firm embracing marketing concepts, particularly given that most fee earners are time poor is the con-cept of recognition and reward for be-ing active and an understanding of the importance of co-ordinated marketing efforts. Marketers are then faced with the need to facilitate buy-in by the firm to harness the fee earners who effectively ‘own’ the relationships nurtured by regular contact or work with clients and their decision makers. Logically,

fee earners understand the importance of their relationships with clients and need to maintain these as part of busi-ness strategy. However, motivation, commitment and recognition presents difficulties for fee earners under pressure to de-liver within tight deadlines to compet-ing clients and being measured on productivity or budgetary targets. Too often, when fee earners are not billing, they turn to marketing activity and then when work comes in they stop marketing to deliver the work. This approach means that the best market-ing efforts are ad hoc and not fol-lowed through which impacts on the success of campaigns. Marketing orientation – clear message to the firm A firm’s approach to marketing is a major factor in garnering the support and focusing the efforts of fee earners. Most professional services firms use supply based budgeting formulae, i.e. multiplying number of fee earning staff and maximum billable hours multiplied by charge out rate. Over-heads, recoveries, and costs are fac-tored in to produce a budget to which fee earning staff are monitored and upon which are rewarded. While this traditional approach in the past has been successful, a market ori-entation that focuses on needs and wants of the marketplace changes the model from a supply to demand based approach. This marketing orientation needs to be embraced by executives to provide overall visible leadership and continued on page 23

Shiv Seechurn

Professional services: transforming fee earners into marketers By Daryll Cahill and Louise Robinson (Associate Member of the Australian Marketing Institute

GUEST SP

OT

Daryll Cahill Louise Robinson


transforming fee earners ……………………..continued from page 22

assist in high-level stakeholder man-agement to the firm. Their visible sup-port can then be incorporated into communications to staff as part of on-going messaging. By adopting a mar-ket orientated direction, staff need to understand this alignment with market needs and understand their role in be-ing part of the marketing effort. This commitment by leaders is key to the success of marketing campaigns. Fee earning staff are comfortable with traditional productivity or budget tar-gets. In devising a program of market-ing efforts, clear goals and perform-ance criteria that recognises both the productivity targets along with sales or marketing efforts can be adopted si-multaneously, provided that messages are consistent. Too often, marketing may be seen as ‘fluffy’, unimportant or unmeasurable so efforts are not focus-sed on achieving outcomes. Three key steps to overcome the chal-lenge of harnessing fee earners in firm’s marketing efforts are: 1. Active endorsement by an execu-

tive or senior partner to promote the notion of market alignment and therefore the role of market-ers in facilitating this process will assist earn buy-in by the fee earn-ers. Ideally this will be the CEO or managing partner who advo-cates the importance of the initia-tive and support marketing to drive the efforts throughout the firm.

2. Identification of key accounts. Key accounts are the firm’s largest accounts and are regarded as pri-orities for all activities. By nomi-nating clients to be priorities, tai-lored marketing plans can be de-vised for them, then efforts can be measured and success cele-brated. Measurements may in-

of opportunities to tender created, number of relationships made within the organization or even number of new leads.

3. Identification of fee earners who can act as champions – those who are recognised as having extraordi-nary relationships with clients, committed to client care and are able to deliver both productivity as well as extending the scope of en-gagements to clients. Initially these are the lead partners on the above accounts so that their efforts can be focussed on key accounts. Pro-motion of successful behaviour via these champions and success on accounts will provide models of behaviour that other fee earners can observe and replicate. Ideally, as market oriented behaviour spreads, other champions outside of the partner group can be identi-fied across all levels of the firm.

Defining winning behaviours To assist fee earners to understand marketing and their role, it is impor-tant to define winning behaviours. For many fee earners, focussed on delivery of technical advice, the term ‘marketing’ or even ‘sale’ can be threat-ening. Marketers can assist, define roles, and introduce simple measures that fee earners can understand and implement. Those that feel threatened do not need to make major changes to their behaviour and can be eased into marketing, or to the other extreme; those who are likely to create market-ing havoc by introducing themselves to a number of clients without regard can become part of a co-ordinated ap-proach.

For simplicity and penetration through-out the organization, four simple defi-nitions of winning behaviours can be used to encompass the range of skills and risks associated with behaviour fo-cussed on meeting needs and wants of marketplace as well as delivering agreed upon technical services. These can be defined as: • Billing for all work performed. To

encourage behaviours that lead to discussions with clients on total charges such as overruns rather than opting to discount at the bill-ing stage. Better recoveries should be encouraged and recognised.

• Expanding the scope of the en-gagement, or renegotiating a bigger fee than already negotiated. Dis-cussing work with the client and gaining agreement for additional fees.

• Identification of additional services to the client. Cross selling is a great way to gain greater coverage within a client and leverage from existing relationships.

• Winning new clients. Always excit-ing and easily promoted through-out the firm, particularly if further work is anticipated.

Communication Leaders play an important role in ar-ticulating goals and objectives and ac-tively promoting a market based cul-ture. This would assist with encourag-ing people to continue to act in line with market needs – the results will not be immediate hence the need to con-tinually motivate staff to continue is important. To assist with messages about market-ing the following will need to be de-fined and communicated: • Identification of key clients and

articulation of their service needs. If possible communicate examples continued on page 24

Harnessing Fee Earners for Marketing

1. Active endorsement by an executive or senior partner to pro-mote the notion of market alignment.

2. Identification of key accounts. 3. Identification of fee earners who act

as champions.


transforming fee earners ……………………..continued from page 23

of winning behaviours applied to these or problems that were solved to provide positive enforcement of successful efforts.

• Identification of key champions and active participation of leaders to continually promote the initia-tive and success stories of satisfied clients.

• Articulate performance targets and how these relate to business goals. This may be a business unit has to increase billings by 10% or to ar-range for introductions to other service lines. Both of these activi-ties can be measured.

• Feedback loop so staff can share experiences and with others.

• Culture that promotes attempts at winning – for fee earners at all lev-els to bill an additional $X per week will soon add up to increased revenues without having to win new clients.

• Recognition to take time out to celebrate success or share experi-ences. Posters, emails, voicemails or mentions during meetings or refreshments can work wonders.

Marketers play an integral role in pro-viding strategies to encourage fee earn-ers to market the firm. The key to cre-ating a successful framework is first support by management to change the marketing orientation of the firm and encourage staff to participate. Through marketing internally and educating the firm about marketing, professional ser-vices marketers are then able to trans-form fee earners to participate in exter-nal messaging and campaigns. Louise Robinson is a national director of business development and marketing and has significant experience in professional services gained in large Australian legal and global accounting firms.

Dr Daryll Cahill is a senior lecturer in the School of Accounting and Law, RMIT University, Melbourne and has research interests in measuring intangible assets and intellectual capital. Cahill, D and Robinson L, 2004, “To set rates, consider the value proposition”, Marketing News, The American Marketing Association, April 15, p 37 Cahill, D and Robinson L, 2004, “Professional services: try using account management principles”, Australian Marketing Institute (to be published in May

dent/Account Service Director for 9 years, and worked on accounts such as American Airlines, Halliburton Corpo-ration, Zale’s Corporation and North-ern Telecom. In 1990, Mike joined Puskar Gibbon Chapin (advertising) in Dallas, followed by Berry Brown Advertising. Mike added more clients to his experience roster: Furr’s Super-markets, Rheem-Ruud Air Condition, Kimberly-Clark, Wilshire Medical, and Bowman Environmental. In August 1996, Mike joined the American Concrete Pipe Association as Director of Marketing following the Association’s relocation to Irving, Texas from the Washington DC area. He was responsible for all marketing communications for the Associa-tion — including advertising, sales promotion, public relations, trade shows, Internet programs, Concrete Pipe News, competitive response and literature production. Mike left the Association in January 2004 and now provides professional marketing con-sultation through his own firm, Pho-rum Marketing Services. While at ACPA, Mike served as the past vice chairman of the Environ-mental Council of Concrete Organiza-tions (ECCO). He also works closed with other associations such as The Portland Cement Association and Na-tional Precast Concrete Association on programs benefiting the precast concrete pipe industry. Mike is delighted with his selection as a Member of the Canadian Institute of Marketing, and feels the Association provides a real value to its stake-holders. He is impressed with the sharing of information via the organi-zation’s newsletter and efforts to ele-vate the stature of marketing profes-sionals throughout North America. Mike was elected to the Board of Di-rectors at the AGM in June. continued on page 25

James M. (Mike) Saubert, MCInst.M Mike was accepted as a member in May 2004. His background includes extensive marketing communications experience with a variety of companies, advertising agencies and organizations located in the Dallas-Fort Worth area of North Texas. He is a graduate of the University of Oklahoma with a Bachelors of Arts in Journalism, minor in Marketing. Following graduation from OU he moved to Dallas, Texas and worked for the US Department of Agriculture as a writer and farm broadcaster. His next job was Office Manager for Sears Roebuck & Company regional offices in Dallas. In 1974 Mike joined the sales promotion department for Armstrong Industries in Arlington, Texas. His 7 years of work in the home furnishing industries landed him the position of director of marketing for Bruce Hard-wood Floors in Dallas. Armstrong In-dustries now owns Bruce Hardwood Floors. Following a brief stop at a specialty lubricant manufacturer in Fort Worth, TX, Mike joined Bozell & Jacobs, Inc., the largest advertising agency in the Southwestern US in 1981. He served in varying capacities including Vice Presi-

Member Profiles


member profiles ……………………..continued from page 24

Shelley Repka, MCInst.M Shelley Repka has taken pleasure in being a marketing professional for over 15 years. She has been the Presi-dent of Cool Projects for Revelation Marketing for seven years. She special-izes in traditional and relationship marketing, cause-related “social” mar-keting, Internet marketing, strategic planning and development, event and tourism marketing, brand develop-ment, advertising and public relations. She is known for innovative, realistic and workable solutions for improve-ment of revenue streams, business and marketing strategies, analysis of poten-tial development components (based on idea generation and market analy-sis). Shelley has helped various businesses and not-for-profit organizations in de-veloping successful projects and in increasing profits. She is known for developing customized solutions to meet the client’s needs. Prior to that, she was Sponsorship and Communi-cations Manager at Rogers AT&T, a Canadian wireless telecommunications firm for seven years. She has over ten years experience in the telecommuni-cations industry. Shelley has wide range of experience and capabilities in strategic planning, business and marketing development, communications, advertising and pub-lic relations. She has developed vari-ous unique promotions such as the successful “Circle of Friends” social marketing campaign with the Calgary Fetal Alcohol Network, CFAN. The business and marketing launch strat-egy for Fido, Microcell Solutions in the Alberta market and Mail Boxes Etc. Event marketing promotions such as the “2002 Holiday Magic” promotion at Bankers Hall Centre and the “2001 Live Statue” Christmas pro-

Shelley is on the Board of Directors for the University of Calgary, Community Services Centre and a member of the Canadian Institute of Marketing. She is also a past member of the Canadian Marketing Association, Marketing Ad-visory Board and the Tourism Commit-tee at the Calgary Chamber of Com-merce. Shelley is a recent volunteer of the Calgary Stampede, Indian Events Committee. Ms. Repka obtained a Business Di-ploma specializing in Marketing and Tourism Marketing from the Southern Alberta Institute of Technology. Shel-ley has received the Province of Alberta Certificate of Merit and 1998 Small Business – Group of ’98 acknowledge-ment.

recognize that technology can only support customer service - it can never replace the all-important human ele-ment. The author cites telemarketing and interactive voice response systems as examples of "non-service" - which serve the needs of the company, rather than customer needs. To be effective in customer service, technology should be tailored to the needs of the customers." Howard Pearl, MCInst.M Howard is President of Rhino Off-Road Industries. He recently relocated his operation to Henderson, NV, a State known as a center for off-road enthusiasts, and offering the specialized and educated workforce needed to ful-fill the Rhino Gold Standard. Rhino Off-Road Industries has rede-fined the off road experience by com-bining the ATV and Monster Truck. The Rhino Rough Terrain Vehicle or RTV is an innovative new class of off-road vehicles that offer the highest level of safety and ride-ability in a pro-duction performance vehicle Operating out of a 12000 facility in Henderson Nevada, Rhino Off-Road Industries fabricates and assembles the revolutionary RTV. With a highly skilled team of welders, fabricators, mechanics, assemblers, and engineers, Rhino Off-Road can produce as many as two RTVs per day.

Member Mentions James Schauer, FCInst.M The ICFAI Univer-sity in India is pub-lished a book ed-ited by Professor F.F. George, entitled, Every business is a Service business. In his editorial introduction, Profes-sor George noted, “In The Use of Technology in Customer Service," James A. Schauer makes the point that the increasing use of technology in customer service has had the effect of actually lowering, rather than enhanc-ing, the level of customer service pro-vided by companies. Instead of relying on technology to improve customer service, companies must get their ba-sics right. This includes understanding the customers and their needs, and maintaining a balance between profits and customer service. They must also

James Schauer

Easton Marketing Services Ltd. Susan Hughes The Palace Casino Réal Chabot TransBio Tech Len Weeks Manager, Knowledge Industry, Business New Brunswick Prasanna Perera Tetrapak Ron Halliday Marketing Dynamics Financial Report Our financial reports and bookkeep-ing are undertaken by O. Emmanuel, MCInst.M., CGA., CMA. For fiscal year June 1, 2003 to May 31, 2004, the Institute generated $20,776.47. Its expenditures totaled 18,525.11 with a net income of $2,251.36. The debt owed to the Royal Bank has been re-duced to $2,950 owing as of May 31, 2004. The debt is expected to be re-tired in or before April 2005. Membership Currently there are 152 on the member-ship roster, with about 80 percent resid-ing in Canada. Twenty percent of the total membership resides in the Greater Toronto Area. Many members on the roster have yet to remit their 2004 me m-bership subscription. By-law The Institute’s By-law is dated and re-quires updating and several revisions. G. Lee will present a revised B-law at the 2005 AGM. Matters to be in-cluded are the establishment of a mar-keting standing committee to monitor and implement the Institute’s market-ing plan, the establishment of a Col-lege of Fellows to oversee the process of electing Fellows, and a general re-write to accommodate the Institute’s vision as being the home of profes-

Although lightly attended, our annual general meeting was productive with major works ahead for members who have remained active and anyone who wishes to jump in and get involved. Here are the highlights. We have a full Board of Directors with a balance representation domestically and abroad. Our Directors have al-ready dealt with one issue that has plagued the Institute for the last three years dealing with rules and procedures for members to be elevated to Fellow. Board of Directors for 2004-2005 term Joshua Caplan, (Chair) Array Systems Computing Inc. Shiv Seechurn (Vice Chair/Registrar) Canada Customs and Revenue Agency Oswald Emmanuel (Secretary/Treasurer) Trillium Health Care Suzen Fromstein The Write Connections Charles Adegboyega Marketing Consultant Mike Saubert Phorum Marketing Services James Schauer

sional marketers in Canada regulated by federal legislation. Education The Standing Committee on Education and Professional Development will de-velop the Institute’s ‘Graduate Program in Marketing’ to serve as our core stan-dard of education requirements for membership and for setting the standard for accrediting marketing programs of colleges and universities in Canada. We will continue to promote the CIM UK professional certificates and diploma program currently offered at Georgian College in Barrie. Communications and promotion This term, the Institute will be in a fi-nancial position to become more active in industry media and at trade shows. We have committed to sponsorship (for the fourth year), of the MARCOM con-ference in Ottawa in 2005, and forge strong relationships with Marketing Magazine and Strategy Magazine as well as selected dailies across Canada. International The Institute is in the process of setting up formal relationships with like-minded professional marketing institutes in other countries through memorandums of understanding, in light of a globalized marketplace and common interests shared by many marketing organizations. Web site A “redo” of Institute’s Web site is a pri-ority project as we are Web and Inter-net-based for all of our communications. Most inquiries for membership arrive through our Web site. Budget The 2004-2005 budget has been set with a modest increase in revenue expected and a retirement of the Institute’s debt burden. Members who attended the AGM in person or by proxy contributed signifi-cantly to the direction of the Canadian


AGM heralds new year of hard work By A. Grant Lee, FCInst.M., General Manager

Ranil Herath Josh Caplan Chula Wijesundara

Oswald Emmanuel Ranil Herath Chula Wijesundara

Grant Lee and Shiv Seechurn

Canadian Institute of Marketing Directors & Officers

Joshua Caplan Chair Array Systems Computing Inc. Tossnarain (Shiv ) Seechurn Vice Chair/Registrar Canada Customs and Revenue Agency Oswald Emmanuel Secretary/Treasurer Trillium Health Care Charles Adegboyega Marketing Consultant Réal Chabot TransBio Tech Suzen Fromstein The Write Connections Inc. Ron Halliday Marketing Dynamics Susan Hughes The Palace Casino Prasanna Perera Tetra Pak Asian Emerging Markets Mike Saubert Phorum Marketing Services James Schauer Easton Marketing Services Ltd. Leonard Weeks Manager, Knowledge Industry Development, Business New Brunswick

Full Member No. 710 James M. Saubert Arlington TX Full Member No. 712 Ranil Herath Toronto ON Full Member No. 713 V. Jude Ponniah Toronto ON Associate Member No. 709 Jyotika R. Prasad Fiji Islands Associate Member No. 714 Catherine Tsatoumas Montreal QC Graduate No. 711 Chantal Bertrand Barrie ON

Page 2 7

New members and membership upgrades* (to June, 2004)

Full Member: A) Has held an acceptable marketing position for 5 years, the last 2 at senior management. B) Hold a recognized qualification in any of the following, or mature entry instead. • A diploma of an Institute of Marketing; • BA, MA or doctorate degree with marketing specialization; • Diploma or university Post-graduate Diploma in Management Studies or Business Administration with marketing specialization; • Other educational or professional quali fication of equivalent or higher standard with marketing input – approved by the Canadian Institute of Marketing or one of its affiliated marketing institutes.

Associate Member: A candidate must meet the following re-quirements: A) Has held an approved marketing posi-tion for 3 years, the last in marketing management at a lower level than for full membership. B) With one of the following academic qualifications: • A Certificate of an Institute of marketing or, subject to its marketing component being approved by the C.Inst.M., a BA or MA in a business-related subject; • Diploma or University Post graduate Diploma in business Administration or in Management Studies; • Other educational or professional qualifications of equivalent or higher standard approved by C.Inst.M.

Graduate Member: A candidate must meet the following re-quirements: A) Have successfully completed an ap-

proved Marketing Certificate or Diploma programme from a recognized learning institution, or posses a business-related Bachelor degree. B) Be elected by the Institute.

Student Member: A candidate must meet the following re-quirements: A) Be registered in a Marketing Certifi-cate or Diploma programme; B) Be registered in the final year of a de-gree programme with Marketing speciali-zation. The Marketing component must be approved by, and the learning institu-tion accredited with, the C.Inst.M.

Fellow: • Ten years of membership in good standing (exception rule in place) • Vote of College of Fellows, Past Presi-dents and Board based on nomination and application and review. • Based on leadership, knowledge, ex-perience and sustained membership.

Membership Requirements

Volume 7, Issue 2

Code of Ethics

The professional marketing person has responsibilities to

their employer, to customers — both ultimate and

intermediate — to their colleagues and to the public. The

Institute requires its members, as a condition of member-

ship, to recognize these responsibilities in the conduct of

their business, and to adhere to the Code of Ethics. All

members shall be answerable to the National Council of

the Institute for any conduct which in the opinion of the

Council is in breach of this Code and the Council may take

disciplinary action against any

member found to be in breach thereof.

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To improve Canada’s professional marketers’ skills to the highest international standards by providing training, opportunities and services to business enterprises, government, learning

institutions, students and members of the Institute

Journal of the Canadian Institute of Marketing Le Journal de l’Institut Canadien du Marketing

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Humour (Relatively Speaking Division)

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Power of Branding 3rd Annual Conference October 6, 7 and 8, 2004 with the support of The Canadian Institute of Marketing American Marketing Association (Toronto) Participating Organizations Alliance Atlantis Communications Arnold Worldwide Canada Canada Post CIBC Clarica Life Insurance Company D&B Canada Dundee Securities Corporation First

Canadian Title Hewlett-Packard (Canada) Co. ING Direct Maple Leaf Foods Inc. McDonald’s Restaurants of Canada Ltd. Monster.CA Readers Digest Association (Canada) Ltd. Rogers Publishing Saputo Inc. Spencer Francey Peters Toronto Blue Jays Contact Grant Lee for details at [email protected] or 905.877.5369

Business Administration—Marketing Diploma

Two-Year Business—Marketing Co-op Diploma

Certificate in Marketing (CIM) Advanced Certificate in Marketing (CIM)

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