There is only one valid definition of business purpose: to create a customer… Because it is its purpose to create a customer, any business enterprise has two — and only these two—basic functions: marketing and innovation…
Peter Drucker, Legendary Management Consultant
I have a friend who recently took a job at one of the largest companies in his industry. He became the head of their national account sales team and will be a real asset to their organization.
When we spoke recently, I asked him to describe their marketing team.
He told me they don’t believe in marketing because they don’t think it works. He said, what he has come to learn is that they do believe in marketing, they just don’t have people with formal and official marketing responsibility.
They aren’t big on titles or departments or corporate structures. They have been in business for 30 years and a few years ago they set up a human resource department.
The company in question sells thousands of different SKU’s to thousands of retailers under their brands and under private label. They are an enormously big privately held business. At first, I was a bit shocked, they can operate without marketing – but they do.
The truth is they do believe in marketing. This company just calls it something else.
What Does He Mean, They Don’t Believe in Marketing?
- As I dug deeper, I learned that they don’t have a formal marketing department. They do have people who create new brands, develop packaging and imagine personalities to connect with those products. They aren’t called brand managers.
- They also have people who come up with trade promotions beyond price discounts to help sell their product. They aren’t in marketing, but sales.
- This company has one of the world’s best logistics teams that has found a way to use distribution as a powerful brand differentiator. Their logistics teams don’t market their capabilities, everyone in the industry sees it.
- They sell 3 of the top products in their category without advertising but with a highly differentiated product. They don’t believe they need product managers. Something is working with how they do things.
- Social media is a hobby that they play with but don’t focus on at all. They put their efforts into driving down costs and elevating quality. Not an easy trick to pull off.
- Their value proposition tends to be around exceptionally low pricing for excellent quality products. And their results show their geniuses at executing this high value/low price strategy.
- Their customer support teams are outstanding and demonstrate a robust understanding of being responsive to inquiries. But no one in customer service is a traditionally trained marketer.
Peter Drucker never said you needed to call these people marketers. He believed you needed those functions somewhere in your organization. Companies don’t require marketing departments filled with MBA’s.
Companies do need:
- People who understand how to create value and differentiate themselves.
- People who are extraordinarily responsive to customer’s needs.
- People who are innovative, creative and resourceful to get the job done.
- People who are competent at working within a complex, highly regulated industry by learning the rules inside and out.
- People who are ruthless at driving waste out of their organization.
I believe that a formal marketing department is vital to the success of most businesses.
When my wife and I ran our small bakery business, we had revenue in the millions but didn’t have a marketing department either. In fact, when I look back to the late 1970’s and most of the 1980’s, I don’t think I understood what it meant to market product.
At that time, I knew that if we faithfully served our customers, never cut corners and made a differentiated and valuable product; people would keep buying our little brownies. It turns out we were right, and no one was in charge of marketing. Even though we haven’t baked a Rachel’s Brownies in close to thirty years, we still get emails and letters from former customer’s who wish they could buy them today. We understood how to build a brand, we just didn’t think in those terms.
Whatever you call it marketing and innovation, those skills and capabilities better be built into the DNA of your company. Whether you have a marketing department or not, as Peter Drucker said, a company needs to find a way to create a customer.
How effective is your company at creating customers through innovation?
Is marketing a mystery to you and your business? Call me at 919 720 0995 or email me at jeffslater@themarketingsage.com – or book some time on my calendar. You can hire me as a fractional CMO/VP/Director of Marketing for a few hours per month.
Photo courtesy of Peter Drucker Estate
