The Marketers' Toolkit - 'K and L'

Hello, and welcome to the Marketers' Toolkit with Charles Nixon and me, Kieran Kapoor. Charles, we have reached K. Good old Philip Kotler. You can't really talk about marketing sometimes without mentioning Kotler.

He is one of the gurus. In many ways, he's written some of the most foundational texts. He is still writing, at least he was when I last checked. His brother is also a professor of marketing.

and I believe, Charles, you've met him. Oh, yes. He gave the first college annual dinner and was very complimentary and wrote a very nice testimonial for the college after we'd met. The aspect of Philip is that he has basically written everything on the subject of marketing as a sort of level that everyone needs to understand and across many, many different sectors.

So he is the foundational work that nearly everybody should read when they're getting into marketing. There are lots and lots of other gurus on marketing in specialist areas, but Philip has laid the bed work for nearly everybody from the 60s onwards. His main text on analysis, planning and implementation is still one of the prime readers. But he's also written works on marketing in the arts and the services and many, many different sectors.

He still keeps up to date. I think his latest work was on marketing and AI and its usage. And he has many collaborators these days. He's at Kellogg Graduate School and has been for decades.

And he still blogs consistently on LinkedIn. So do follow him. Do have a look. It is never not worth your while to keep up with Philip Kotler.

For many of us, I think we all have a Kotler on the shelf, if not two or three, I think in my case. Okay, obviously lends itself to key. So key accounts, let's go down a sort of looking at the sort of the important accounts in your business. It's very easy to forget to do the segmentation.

And one of the segmentations we always talk about is pulling out your key accounts. Yes, I think key accounts or key markets is really very important because the anti-20 rule applies. You are going to get a more than proportionate amount of business from certain smaller numbers of customers. So you need to keep an eye on what their changes in attitudes and desires are and how they react to various social and economic pressures.

So the key accounts is a fundamental aspect of marketing. As indeed key in terms of keywords these days we using keywords an awful lot in terms of web searches And increasingly web searches are now going to have to be AI enabled to be responsive So think about the keywords that are being used there as they change from perhaps just you know what is the problem to a more contextualized problem that people are trying to solve and expecting AI in the search engines to solve a problem.

KPIs. Key performance indicators, an extremely important part of any marketers toolkit and indeed any businessmen's. The elements that we're looking for here is the features that are going to lead to the success of your strategy. So essentially, what are the indicators that say you're making progress towards achieving the element of success in your strategy?

So they're key in the fact that they're the essential ones and they are about what you're doing or the company is doing in terms of its performance. They're not the same as objectives, so they don't necessarily have to be financial, but they are things that are important for the success of overall sustainability of the organization. And I mean sustainability and survivability. So the element that we're often looking at would be number of customers retained, number of customers acquired, as well as obviously customers lost, rather than just market share.

Yes. The other word that I want to bring out is key and its performance. It is only an indicator. Sometimes you see organisations junk everything they're doing because the KPI doesn't seem to be going the right way.

Maybe you do need to twist it and flex it and have a think about your campaign and see what you need to change. But you don't necessarily need to throw everything out because the indicator may be indicating that actually it's going to come around. Use your common sense. Use some thoughts and now some looking at other things within the market before you go.

the KPI is showing what we don't want. So, we've got to stop everything. Shall we move on to L? We will indeed.

So, I think the most important one is probably the life cycle, usually known as the product life cycle. Not necessarily the most important, it's just one of the most foundational L's. The product life cycle or the life cycle. Charles, we always teach it going through sort of four stages.

Yes, indeed. And there are a couple of L's in that as well. At the end, we have laggards, with people who probably will never buy your product or never adopt your technology. And before them, there are the late majority, which is the vast number of people who will take up any new technology or product when it becomes convenient for them to do so and they can afford it.

The life cycle has been around for a long period of time, I think invented by the Boston Consulting Group, and essentially was really trying to indicate that the marketplace shifts in the early stages of a new product being introduced from what we might call the innovators those people who will buy anything that is new and tend to some degree aren looking at it necessarily from a cost-effective point of view, to those who then will buy it because they want to have something which is very importantly new, but also is something that's effective and solves a problem.

And they're tending to buy things which are at the early stage in the life cycle, and therefore they tend to be expensive. And then, as I say, we get into the early majority and then the late majority. It is actually a standard distribution. So we have two and a half percent of innovators and a very small number of people who are laggards.

But the majority are in those early and late majority sections. So we are looking at the way in which you have to change your marketing to appeal to each of those sectors as you go through the evolution of your product lifecycle. And again, don't fall into the trap of thinking that innovators are always young. There always tends to be an assumption that we're talking about computer games and they are young male gamers, but actually that's not true in the gaming market.

There are as many female gamers as male gamers. It's also worth pointing out that if you're innovating in the gardening area, then Charles and I might be your early adopters or your innovators because, you know, we're both into our gardening. We might be interested in the new and the exciting. So, it is definitely worth looking at the marketplace carefully.

There are companies that specialise in picking up products that are aimed at laggards, sort of, we'd also call them dog products, products at the end of the lifestyle, because there is still money to be made on them. So again, there are marketing things to do at each stages of the product life cycle. Do not dismiss any of those, depending on your organisation. Life cycle also can be applied to the family.

And one of the socio-psychological profiles that is often used is the family life cycle, as people have moved from being independent and into partnerships. Then they have children. Those children then grow up, leave the nest, and hence the empty nesters scenario, until eventually they become singletons at the end of their life cycle. So the element of life cycling is something that can be applied to quite a lot of different marketplaces, not just the product.

So do consider how your marketplace will move over a period of lifecycling. And what else do we have, Kieran, in the L's? So one of the other things that comes up under L is line extension. So this is it part of innovation in fact It is saying that I got a product in the marketplace and I going to launch something that very similar to extend the line You see a lot in food marketing, a new flavor.

I was buying Magnum ice creams. I noticed that Magnum Baileys are back again. Yippee. But also the along Magnum Extra Darks and various other things, that's a line extension.

it is to catch your eye it's to be new and innovative it's to have another way of sort of kicking forward a marketplace and it encourages you perhaps you're going oh i'm a bit bored of my normal magnums oh i'll look oh look there's something different so it can be a new flavor it could be a new size it can be a new application of your product yes often seen in cosmetics where fragrances are extended through different ranges and products which are successful perhaps in the shower may well extend into the deodorant marketplace, etc.

So line extensions or product line extensions is a significant way of growing the presence of a brand in the marketplace and a real asset for marketers' toolkit. Another aspect of innovation to some degree is the learning curve, an economic term, but essentially is something that shows that over a period of time, One gets used to production and development of a particular product and can therefore learn from that and bring down the cost of assembly, the cost of distribution, the cost of the good.

That in itself then improves the margins and possibly allows for changes in pricing to gain more market share. So the learning curve is quite an interesting concept. Again, I believe also from the Boston Consulting Group. I think that brings us into our final L, which is actually going to lead us into M.

Charles, you wanted to mention Levitt. I did indeed. Theodore Levitt is an iconic guru, I suppose is the best terminology. Wrote a seminal work called Marketing Myopia many, many years ago, but it's still essentially a very good read.

I would recommend it to anyone listening to the podcast to read it on a fairly regular basis. It is something that has been updated. And so Levitt has been a very good contributor to the marketers library over a long period of time. And we will discuss marketing myopia next time.

Goodbye. Bye-bye.