Magazine article New Zealand Management

The Oracle's Words: Why CEO Larry Ellison Writes His Company's Ads; Chief Executives Unconvinced of the Importance of Marketing in the Management Hierarchy Could Take a Leaf from Oracle CEO Larry Ellison's Book of Priorities. He Might Be the World's Third Richest Individual but Still Writes the Company's Ads. Why Doesn't He Entrust the Job to Anyone Else? (Marketing)

Magazine article New Zealand Management

The Oracle's Words: Why CEO Larry Ellison Writes His Company's Ads; Chief Executives Unconvinced of the Importance of Marketing in the Management Hierarchy Could Take a Leaf from Oracle CEO Larry Ellison's Book of Priorities. He Might Be the World's Third Richest Individual but Still Writes the Company's Ads. Why Doesn't He Entrust the Job to Anyone Else? (Marketing)

Article excerpt

Chris Hammel, six foot plus of articulate, immaculate marketer, is vice president marketing Asia/Pacific. He whistle stopped Auckland recently, explaining the company's approach to managing its marketing budget as he went. He also threw some light on the reasons why his boss sees marketing and product development as the two most critical functions of his US$20 billion enterprise.

Two years ago Oracle decided that the fundamental power of its brand was based on two things: consistency of the (product) message and synchronisation of delivery of that message. To get the message consistent they centralised the process of determining competitive positioning, product statements and corporate themes.

Synchronisation in delivering the company's messages meant handing responsibility for all marketing resources over to a newly created `marketing organisation'. Regional and country managers had marketing extracted from their direct management report. Marketing could no longer be viewed as a discretionary spend option available for cutting to achieve bottom-line targets.

With the marketing budget owned by the marketing organisation New Zealand's marketing manager Nigel Murphy reports to Hammel who in turn reports through to Ellison's global marketing chief. "It means," says Hammel, "that in difficult times I get to keep the marketing budget in my region fairly steady." Oracle's global marketing spend discretion rests with Ellison.

The new reporting line means that the "short-to-medium term balance gets addressed a little more in favour of the medium term", according to Hammel. The trick in the exercise is to ensure marketing does not get carried away with its independence and start building programmes without regard to results.

There was some opposition. Managing directors and heads of sales in some countries resisted their loss of direct control over marketing spend. "There was a transition period where the relationship broke down a little bit," admits Hammel. "But now everyone understands that they are getting better service [from marketing]. The programmes we are delivering now are much higher quality than they were."

Centralising the message and its method of delivery means countries don't have to spend time and energy on "creating their own programmes" and the focus in the field has shifted to executing the programmes that work best. In New Zealand, for instance, they can work on how best to deliver a given programme in Wellington which might be slightly different from delivery in Auckland.

"There is no question the quality of our marketing has gone up," repeats Hammel. "There is also no question that in terms of brand awareness and recognition that Oracle has emerged in the last two to three years as a much bigger brand, particularly at [senior] executive level." And this is important because, he says, IT purchasing decisions have moved from the IT department to include more top level managers.

Hammel credits advertising with much of Oracle's recent market success. The fundamentals of that advertising are "an impact message, said often and said consistently". "Don't change [the message] too much because if you do it doesn't sink in."

Oracle has upped its advertising spend around the world at a time when most IT companies are slashing budgets. The industry was hit first by the dot-com collapse and is now facing depressed sales induced by the faltering United States' economy. Oracle, on the other hand has upped its awareness activities and raised it PR profile. "We are able to do this be cause we aren't doing different things in different places anymore," says Hammel. …

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