In marketing, attack is usually the best means of defence. 
 

IN business academia, marketing is a multi-faceted discipline that embraces everything your company does, from product planning and development to the time the consumer takes the product home in his warm, eager hands. In the context of this book, marketing is what you do:

  • to seduce the consumer to try your product rather than  someone else's;

  • to entice the consumer to come back for more, and

  • to make it hellishly difficult for foreign invaders to poach in your sector of the market.

     

HOW DO YOU ACHIEVE THESE IDEALS?

Through carefully targeted, objective-driven:

  • Advertising.

  • Public relations.

  • Promotions.

  • Customer service.

So...


WHAT'S THE FIRST STEP?

Get to know your market. Intimately. Which the American Wrigley Company didn't do. So it lost the first skirmish in the battle to usurp locally produced Beechies chewing gum from its dominant position in the South African market.

Royal Beech-Nut expected Wrigley to spearhead its invasion with its famous strip chewing gum. Since Royal didn't have a product to match it, it quickly developed look-and-taste-alike Edge to block Wrigley's entry.

Royal launched Edge before Wrigley's arrival and positioned it price-wise somewhat below what Wrigley was expected to charge.

But Wrigley didn't move into South Africa with its strip gum. It entered with its P.K. brand, a bean chewing gum product similar to Royal's Beechies.

Royal had to change its strategy. Fast. Quick thinking led to The Beechies Plan to counter the Wrigley Threat. The plan, in turn, led to:

  • an increase in expenditure on radio and TV advertising, and

  • changes in product and packaging.

The Beechies' chewing gum bean was increased in size to match Wrigley's P.K. beans. The pack was redesigned to  emphasise more strongly the brand name.

And the plan didn't end there.

Royal introduced The Hit Squad concept to block Wrigley's distribution efforts. In essence, it called for a fleet of vans to go from shop to shop to lay claim to the best shelf space for Beechies. Since black consumers make up an estimated 60% of the chewing gum market, Royal ensured that the vans called at township cafés and spazas as well as downtown and suburban shops.

And Royal also paid a great deal of attention to in-store displays, particularly at point-of-sale. Surveys conducted every two months measured progress. Or lack of it. Weak areas uncovered by the surveys were quickly strengthened. In addition, Royal offered incentives to sales force personnel for each new Beechies in-store stand erected.

 Wrigley had made two near-fatal errors.

  • It short-circuited market research. It entered the  market with one product, Wrigley's P.K. to cater for all tastes. Even minimum research would have revealed that most blacks, the dominant market force for this product category, have different tastes to most whites.

  • Wrigley entered the market with the arrogant misconception that everyone in South Africa was aware of  its product's brand name. Few, if any of the blacks  had heard of it.

And to compound these faults, the Wrigley launch in South Africa did nothing to promote brand awareness among consumers. It spent most of its effort on print ads in trade magazines, devoting only two radio spots a week on Radio 702 to consumer advertising.

Even Wrigley's choice of medium, Radio 702, essentially a 'talk' station, failed to home in on the mass of its potential market - young, music-loving blacks.

And ...


WHAT COMES NEXT?

Design or adapt your product to meet the demands of local conditions. Because you know -  or should know -  what's wanted and needed locally, you start with a built-in competitive advantage.

At Nissan, for instance, the updating, design and introduction of new products is a continuous process. Indeed, within the next three years the company plans to update all passenger vehicles it introduced over the past three years.

Nissan South Africa enjoys close affiliations with Nissan Japan - an affiliation that recent media speculation suggests will become even closer. This link gives the local company access to a w health of research and development data.

It helps, of course. But, ultimately, adaptations must be made in South Africa to tailor the product to the needs of the local market.

If you feel threatened by foreign competitor ...


STEP UP YOUR ADVERTISING

That's what BIC, with around 35% of the South African ballpoint pen market, plans to do.

Ballpoint pen manufacturers usually spend between 5% and 7% of their annual turnover on advertising. To keep offshore competitors out of its market, BIC is prepared to increase its ad budget by as much as 100% This will force foreign would-be usurpers to pour money into advertising for about three years before they make a meaningful impression.

So foreign companies that want to cash in on the domestic market will be forced to out-advertise the local brand leaders.

With no guarantee of success, it could prove to be an expensive exercise in futility.

And if advertising alone doesn't work ...


LAUNCH NEW PRODUCTS AND MOTIVATE YOUR SALES TEAM

The ABSA group has developed a three-pronged strategy to discourage foreign poachers and enlarge its client base. It will:

  • persist with its present promotion strategy - a combination of advertising and sports sponsorships;

  • introduce innovative, price-competitive products, which include a range of ATM-related products that are still on the hush-hush list, and

  • improve client service by motivating sales personnel through ongoing training.

And then...


PROMOTE THE BRAND NAME

Whether ABI denies it or not, Coca-Cola has been hurt by the proliferation of store-brand colas. And Pepsi's re-entry into the market could pour salt the wound.

But ABI is determined to remain the recognised fizz market leader by aggressively marketing the unique trademarks of Coca-Cola, Schweppes and SparLetta to 'grow its sales ahead of competitive beverages'.

When Coca-Cola's entrenched marketing strategy was splintered by Coke look-alike store-brand cola packaging, ABI went to court. Makro, which markets American Cola, won the law suit, opening the door for a flood of other colas in livery that closely resembles Coke's.

 ABI responded with a massive advertising campaign designed to make consumers brand aware.


'Brand is all we've got'

The Fatti's & Moni's brand name has been around for 75 years.

So what?

So consumers put their trust in any product that's branded Fatti's & Moni's. Or so Trevor Rogers claims.

As an example, he cites how his company's Pasta and Sauce, competing against Royco, grabbed 25% of the market by volume and 'probably much more by value' without advertising support.

If your branding is stale ...


REFURBISH AND REBRAND YOUR PRODUCT

 The Southern Sun Hotel Group did. Very successfully. The group continually 'rubs shoulders with international standards'. So it's sure of what it wants to achieve and how to go about achieving it. That's why it recently splurged R500-million on a hotel revamping and rebranding programme.

  1. After conversion in February 1992 from The Landrost to the Bloemfontein Holiday Inn Garden Court, room occupancy zoomed by 250%.

  2. In Durban, The Maharani, converted to a Holiday Inn Garden Court in April 1993, experienced a 100% rise in room occupancy.

  3. The Newlands in Cape Town saw room occupancy leap by 70% after conversion to a Holiday Inn Garden Court in May 1993.

  4. Room occupancy increased by 60% after the Johannesburg Sun was converted to a Holiday Inn Garden Court in June 1993.

These conversions weren't made on the strength of a whim. They were made after in-depth research by Mac Group a firm of consultants. They prepared documents in collaboration with Southern Sun to show where and how the group slotted into the hotel industry, the size of the industry and the strengths and weaknesses of the group in relation to those of competitors.

What motivated the rebranding and conversion process? The expected influx in the number of foreign, budget- conscious tourists and the severe drop in local disposable income.

The Southern Sun Group now markets five distinct brands:

  • Southern Sun Hotels - four and five-star hotels that  cater for upmarket business and international leisure  travellers;

  • Southern Sun Resorts - three and four-star hotels that  concentrate on the family leisure and conference markets;

  • Holiday Inn Garden Court - hotels that provide low- priced, quality accommodation, and

  • Formula 1 - limited service hotels for the low- budget traveller.

Adaptations to hotel service structures were based on a decision to become more brand focused and customer-driven.

By carefully delineating the various niche markets with the five new brands, Southern Sun will be able to address the specific needs of customers.

The group may also consider an alliance with an international five-star hotel if such a hotel were to be constructed in South Africa.

In such a case, Southern Sun will manage the hotel for the international chain and share Southern Sun's and the chain's brand names. For example, the Sandton Sun-Hyatt.

To maximise on brand awareness, you must ...


POSITION YOUR PRODUCT CORRECTLY

A classic recent case: the battle between Nestlé's Bar-One and the American Mars Company's Mars Bar. Both products are so similar you'd be forgiven for thinking they're identical. In fact, Nestlé admits that it based its Bar-One on Mars Bar.

There's another similarity. Product positioning.

Nestlé deliberately positioned Bar-One as 'the brand for the super-active' - the identical position of Mars Bar in the American market.

The rationale behind Nestlé's thinking is simple.

If Mars tries to position itself as the brand for the super-active in South Africa, consumers will perceive it as a copy of Bar-One. To reposition it as something else would mean starting from scratch - akin to launching a new brand, a costly process that is not justified in South Africa's relatively small and cluttered market.

If conventional ads don't do the job ...


GO BELOW-THE-LINE

To cement relationships with its customers, Adcock Ingram employs a mix of below-the-line marketing techniques. These include sponsoring doctors' attendance at conferences, inviting doctors to watch major sporting events as company guests in the company box and free use of Adcock Ingram's conference and training facilities.


New promotion strategy

And Sappi, which has increased its promotion budget by  R1-million, has earmarked more for below-the-line activity. In addition to more intensive advertising, the new promotion strategy involves incentive schemes for merchants, which include gift vouchers and free holidays.

The company also runs a Million Mania competition targeted at ad agencies and paper specifiers. Contestants submit jobs printed on Sappi papers. The winners get R3 000 to spend on the Million Mania slot machines at Sun City. Other competitions include 'Printer and Designer of the Year'. International judges present awards to winners at a banquet.

For the best results ...


LET MARKETING LEAD

At Carlton Paper, marketing, manufacturing and logistics now work together as a team to enhance customer service.

Of particular interest are changes in the manufacturing processes. These have become more focused in terms of both technology and customers.

Manufacturing now falls under marketing. Marketing leads the organisation. It orchestrates the co-ordination of Carlton Paper's functions. Marketers keep in touch with consumers. They find out what consumers want and, with technical people, translate it into product design. Marketers also liaise with people at factory floor level.

Marketers at Carlton Paper have changed from being individual specialists to people who understand the business ... people who appreciate and understand trade-offs between manufacturing and selling.

And if all else fails ...


DEVELOP A NEW STRATEGY

South African Airways had a problem: rising costs coupled to empty seats. So it designed a new marketing strategy to decrease costs while increasing revenue without increasing fares.

How?

By discounting fares to sell empty seats and revising operating schedules to improve aircraft utilisation.

As part of the strategy, the airline laid on more late night and early morning flights.

Communicating the strategy to potential passengers involves the use of direct response advertising.

In addition to selling seats to improve the per-seat- yield, SAA designed its communications module to create a more desirable perception of the airline among potential passengers.

SAA also:

  • developed and introduced its now popular Frequent Flyer programme;

  • devised all-inclusive tourist packages in co-operation  with leading hotel groups and car-rental companies;

  • holds 'Fly With Confidence' seminars to help fearful  passengers overcome their anxieties about flying, and

  • spends R100-million a year to promote and develop  tourism in South Africa.

In addition SAA has developed a 10-point 'Project Success' plan which, when implemented, will:

  1. rationalise markets;

  2. improve communications;

  3. improve competitiveness;

  4. improve aircraft productivity;

  5. enhance the utilisation of human resources;

  6. cut costs;

  7. optimise assets;

  8. review financing costs;

  9.  reorganise the airline, and

  10. build international alliances.

So ...


LET'S RECAP

  • Study your market until you know it inside out.

  • Modify or adapt your product to meet the needs of your market.

  • Regularly introduce innovative new products to keep consumers interested.

  • Position your product correctly to block easy market  entry by foreign invaders.

  • Use all available forms of communication to create  brand awareness.

  • Use tightly targeted, high-impact advertising to solicit sales.

  • Deploy below-the-line media and methods to cement  bonds with consumers and build brand loyalty.

  • Motivate and incentivise your sales team.

Prev   Next

  Authors Note
    Introduction
     
1. Protection Gets the Bullet
     
2. Perceive the Threat
     
3. Define the 'Get In' Strategy
     
4. A Quick Backward Glance-1
     
5. The Importance of Pricing
     
6. Vital Ingredients: Products and Productivity
     
7. Customer Service: On the Backburner
     
8. A Quick Backward Glance-2
     
9. Preventative Strategies: Price and Service Quality
     
10. Preventative Strategies: The Ramparts of Distribution
     
11. Preventative Strategies: Management - to restructure?
     
12. Preventative Strategies: Market Aggressively to Win
     
13. A Quick Backward Glance-3
     
14. In Conclusion
     
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