Show all articles in this section

Integrating the art and science of marketing

AUTHOR: Lachlan Colquhoun   DATE: 08.12.05   ISSUE 3, 2005

Professor Keller, the E.B. Osborn Professor of Marketing at the Tuck School of Business at Dartmouth College in the US, believes that the challenge for modern marketers is to enjoy that dichotomy, but also work to integrate the two strands into an approach he calls “holistic marketing.”

One of the major dilemmas for modern marketers is the question of measurement.

Illustration: Gregory Baldwin

“There are so many decisions to be made in marketing and there are so many things which impact those decisions that you really have to take a broad, but integrated view,” says Professor Keller, who was at AGSM in November to teach a course, Marketing Management: the New Imperatives, with AGSM Marketing Professor John Roberts.

Professor Keller sees four main themes which need to be developed to deliver the “synergistic view” of marketing he believes is the most effective way to approach the discipline.

You get senior management to support marketing and recognise that it makes a big difference, it really does help.

First of all is the concept of “internal marketing.”

“This is the realisation that so much of the marketing is actually done within the organisation, and doesn't just include what you do outside,” he says.

“Marketing is not just something which is done by the marketing department.

“There are a lot of other departments, such as the IT, research & development, HR and legal departments which all directly or indirectly impact a firm’s marketing success in terms of how they deliver in areas such as customer service.”

A second component is “integrated marketing.”

“This is about making sure the produce, service, communications, and channels are all put together in the most synergistic way possible,” says Professor Keller.

“That’s an old theme but it is still one that marketers are yet to really deliver on, basically because communications have changed so rapidly over the last 15 years and there are now a lot more channels which need to be taken into account.”

A third component, says Professor Keller, is “relationship marketing.”

“This means developing relationships with your customers and understanding customer value.”

“Customer equity is a very important concept but marketers also need to factor in relationships with a lot of other people, such as employees, channel members such as retailers, or other partners such as the advertising agency and the PR firm.”

Another area which Professor Keller sees as starting to impact marketing is the issue of sustainability, and its relationship to the brand.

The final component in Professor Keller’s vision is “performance marketing.”

“There’s obviously a financial component to that in terms of profitability, but there’s more to it than that,” he says.

“It’s about a contribution to brand equity and long term brand value. About what you are doing in terms of the environment, the community and it goes into the area of the triple bottom line, so there’s not just one criteria you are looking at.”

The challenge for marketers, says Professor Keller, is to “holistically piece all that together” and a big part of that is communicating the importance and contribution of marketing to the organisation’s leadership.

“When you get senior management to support marketing and recognise that it makes a big difference, it really does help,” he says.

“A lot of the companies I’ve worked with have realised that and it has really helped their marketing. Some of them are obvious ones like Procter and Gamble and others are less obvious like American Express, but the executives there are big believers in the brand and the importance of the brand, and that helps to tell the story internally.

“Just recognising these things changes a lot of what you do. It can help you focus on internal marketing activities, for example, and get some traction in the vertical dimension and persuade the other departments to participate in marketing, and help them to understand what the marketing proposition is and where the brand sits.”

Professor Keller acknowledges that one of the major dilemmas for the modern marketer is the question of measurement – of providing hard data to the chief executive and the board of marketing’s positive contribution to the company’s bottom line.

“You see this problem of measurement in a lot of firms that aren’t doing a lot to differentiate themselves,” he says.

“They are just competing on price and cost, but those firms would do better to try and differentiate themselves and create more of a price premium, and realise that they’ve got a brand and they have to handle it right.

“There are certainly many people out there who struggle with the whole Return on Investment dimension to marketing and they don’t have any metrics which provide a clear picture of what they get for this amount of money.”

“Smarter organisations,” says Professor Keller, are coming up with scorecards and sets of measures.

“They are also realising that just because you can’t measure it, it doesn’t mean that you shouldn’t do it,” he says.

“I think the smarter companies have an appreciation that there are a lot of different aspects of their products and services which matter, and it’s not always easy to put an exact dollar sign on what those are, but in the meantime that doesn’t mean you shouldn’t do some of these activities.

“The worry is that if you only do what you can measure to the utmost degree then its going to limit what you are trying to do. I think that is dangerous.”

Smarter organisations, says Professor Keller, are coming up with scorecards and sets of measures.

Another area which Professor Keller sees as starting to impact on marketing is the issue of sustainability, and its relationship to the brand.

“Things like what you are doing for the environment and the community and broader issues of social welfare are having a greater impact on brand perception all the time,” he says.

“Younger people, in particular, I think are very sensitive to this type of thing, and they have a greater understanding and interest in what is actually behind the product.

“There are always going to be issues on the quality of the products themselves, but these intangibles are a significant factor and they come into play with different people in different ways, and recognising that is a big part of the challenge of marketing."