Magazine article Marketing

Going for Growth

Magazine article Marketing

Going for Growth

Article excerpt

With business back in expansion mode, marketing should be

driving growth. But it can't without firm commitment from the top

Growth is the Holy Grail of any business, and depending on the economic

conditions there are different ways of achieving it. During the recession if

the 80s and early 90s, cost cutting was the name of the game and marketing

was seen as a wasteful luxury. But now the picture is very different.

Marketing-led growth is back on the agenda.

Procter & Gamble (P&G) and Guinness are examples of companies driving growth

through marketing. P&G has decided that its formulaic ads, generally thought

unexciting but effective, are not working hard enough to deliver the 12% to

13% global annual growth the company demands. Its Agency Renewal project

aims to reinvigorate its advertising and help feed this voracious appetite.

Guinness has also announced a new advertising strategy as part of its bid to

substantially raise its share of the UK beer market to 10%.

Growth has been called the oxygen of business. And the issue of who takes

responsibility for administering the face-mask to the sickly patient could

become a battleground for management consultants - and, by extension,

general management thinking - over the next few months.

Championing the marketing corner is The Added Value Company. Started by

Peter Dart and Mark Sherrington, two senior Unilever managers, a decade ago,

it now employs 200 staff, has branches in Paris, Hamburg and Australia, and

enjoys a fee income approaching [pounds]25m.

Added Value's original idea was to offer big Company marketing

sophistication to small clients, and an add-on external resource to big

ones. Taking stock ten years on, the company has concluded that almost all

of its work has been for big companies, and most of it has been concerned

with achieving growth.

"We've given ourselves a huge goal, which is to re-establish marketing as

the driving force for growth. We want to be the best-practice reference

point for companies that want to grow their brands," says Sherrington.

The well-known international management consultancies, on the other hand,

gave the marketing function a hard time in the recession, and rightly so.

Marketing departments were criticised, not least for failing to measure the

effectiveness of their actions. Perhaps it depends how you define marketing;

is it a culture that pervades a whole organisation from the top down, or the

add-on department that spends the advertising, sales promotion and direct

mail budgets?

Growth is, in any case, a big subject. It embraces brand extensions and new

product launches, diversification, acquisition and geographical expansion.

As one management consultancy pointed out, some companies establish one

platform, then expand laterally into related but not necessarily obvious

areas. Gillette's move into toiletries is clearly linked to its core

business in shaving, but its metal and plastic manufacturing skills from

making razors and razor blades probably explain how it moved into writing

instruments.

There are major issues in this debate. Marketers in particular are likely to

side with the view that desirable, long-term objectives are frequently

sacrificed to the need to meet short-term City expectations for a regular

increase in quarterly or half-yearly profits. A more general management view

is that companies need to strike the correct balance between short, medium

and long-term growth.

Changing climate

There is general agreement that growth is now back on the agenda. …

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