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HOW do you get your foot in the CEO's door and grab the top man's attention for your marketing memo? Nirmalya Kumar has the answer in Marketing as Strategy, published by Penguin (www.penguinbooksindia.com) . "Kumar introduces an intriguing framework for analysing and planning marketing strategy in terms of the `three Vs', viz. valued customer, value proposition, and value network," writes Philip Kotler in his foreword.

And the author, a professor at London Business School, gives the rationale for his work, in the preface: "For the most part, the marketing discipline does not focus on the strategic marketplace challenges that CEOs face today. Therein, lie the origins of this book."

Move from old ways, onto new ground, pushes Kumar: so, shift from tactical market segments to strategic ones to achieve `deep differentiation'; from commodities to `customer solutions'; from organisational mindset to a global one; from `aggressively acquiring brands to actively consolidating the brand portfolio'; from incremental innovation to `market-driving innovation'; and so forth.

Well, if you move from preface to chapter 1, you'd read the sad story of marketing decline. "Some think marketing people do little more than blue-light specials and coupons," is a recent comment of don Lehman, director of Marketing Science Institute, cited by Kumar.

The way out of the deep hole is to achieve `true market orientation' — and that does not mean becoming marketing-driven, clarifies the author. "It means that the entire company obsesses over creating value for the customer and views itself as a bundle of processes that profitably define, create, communicate, and deliver value to its target customers." If that seems a bit too evangelical, there's more; marketing can become a `transformational engine.' Kumar beckons: "We have nothing to lose except hierarchies, national and functional boundaries, and, most of all, the four Ps."

However, he guides with some detailed tips in the chapters that deal with each of the seven `transformations.' Segmentation in companies is "a more complex and messy process than in textbooks," writes Kumar and that should comfort accountants having trouble with segmental reporting.

An interesting example is of Midas, "one of the world's largest providers of automotive maintenance services," as the company's site proclaims. It offers consumers walk-in service for repairs on brakes, mufflers, and exhaust pipes. To segment, the company uses three variables, notes Kumar: One, age of the car, because service needs and age are directly proportional; two, size of the car, "since the bigger the car, the higher the value of the sale and the higher the margin"; and three, sex of the driver, "since women are more likely to buy additional services."

Well, how do you move from products to solutions? Look at the American Express example. In 2002, it signed a seven-year, $4 billion contract that shifted 2,000 IT professionals and computers to IBM, informs the book. "Rather than the standard outsourcing contract, American Express agreed to pay IBM only for the technology used every month." Wonder if our outsourcing giants have considered vending such a formula.

Another chapter discards `branded bulldozers' in favour of `global distribution partners'. It talks of ECR, not the road to Mahabalipuram, but Efficient Consumer Response, whereby retailers and manufacturers collaborate "to eliminate excess costs and serve the consumer cheaper, faster, and better."

Last comes an important lesson: shift from strategic business unit (SBU) marketing to corporate marketing. "The Chief Marketing Officer position is emerging in companies," says Kumar. Such corporate focus would help the CEO decide on portfolio choices, their relationships to achieve synergies, and exercise `parenting skills' that translate as unique advantages for the individual business units.

Kumar never tires of preaching right up to the last page, where he asserts: "Today, marketing is in a perfect position to galvanise the organisation, as value creation strategies shift from the financial engineering of the past decade to old-fashioned customer value creation."

Ignore Kumar, if you have a counter strategy.

BookMark@thehindu.co.in

D. Murali

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