Offensive Marketing: An Action Guide to Gaining Competitive Advantage

428 Pages·2003·2.1 MB·English

by  Warren Keegan

Offensive Marketing
An Action Guide to Gaining
Competitive Advantage
Hugh Davidson and
Warren J. Keegan
with Elyse Arnow Brill
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Offensive Marketing
An Action Guide to Gaining
Competitive Advantage

Elsevier Butterworth–Heinemann
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Linacre House, Jordan Hill, Oxford OX2 8DP, UK
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Library of Congress Cataloging-in-Publication Data
Keegan, Warren J.
Offensive marketing: an action guide to gaining competitive advantage/Warren
J. Keegan and Hugh Davidson; with Elyse Arno Brill.
p. cm.
Includes index.
ISBN 0-7506-7459-8
1. Marketing. I. Davidson, J. H. (J. Hugh), 1935–II. Brill, Elyse Arno. III. Title.
HF5415.K427 2003
658.8–dc22 2003057940
British Library Cataloguing-in-Publication Data
A catalogue record for this book is available from the British Library.
ISBN: 0-7506-7459-8
For information on all Butterworth–Heinemann publications visit our website
at www.bh.com
03 04 05 06 07 08 09 10 9 8 7 6 5 4 3 2 1
Printed in the United States of America
Contents
Foreword vii
Acknowledgments xiii
Chapter 1 The Offensive Marketing Approach: POISE 1
Chapter 2 Profitable: The “P” of POISE 37
Chapter 3 Offensive Vision and Attitudes: The “O” of POISE 67
Chapter 4 Integrated Marketing Approach: The “I” of POISE 89
Chapter 5 Strategic Offensive Business Analysis:
The “S” in POISE 111
Chapter 6 Anticipating the Future: Strategy Revisited 139
Chapter 7 Developing Winning Strategies 157
Chapter 8 Offensive Marketing Planning 189
Chapter 9 Effective Execution: The “E” of POISE Offensive Market
Segmentation 213
Chapter 10 Offensive Brand Development: Effective Execution
Revisited 239
Chapter 11 Offensive Approach: New Product and
Service Development 269
Chapter 12 Offensive Communications 301
Chapter 13 Offensive Market Research 323
Chapter 14 Offensive Pricing 347
Chapter 15 Offensive Channel Marketing 371
Post-Script Offensive Marketing: The Way Ahead 397
Index 401
v

Foreword
With Offensive Marketing: An Action Guide to Gaining Competitive
Advantage, we have at last a well-written, insightful book about
marketing that grasps that marketing is more than just a way to
squeeze a few marginal increases out of a business model. Instead,
Warren Keegan and Hugh Davidson challenge us to use marketing
to drive an offensive, systematic, and long-term approach to busi-
ness growth. This book is a road map to twenty-first-century
strategic marketing, which focuses on creating unique value for
customers and superior return for investors and all stakeholders of
the enterprise.
With the thousands of books on marketing, why should busy
business leaders read this one? The reason is simple—marketing is
placed in today’s challenging business environment. As other dis-
ciplines have changed, so too must marketing.
Offensive Marketing takes a critical look at the narrowness of
many professional marketers and the growing bureaucracy of mar-
keting departments. Professional marketers have often failed to
prevent the erosion of long-term consumer value by focusing on
short-term profit and have failed to realize that market-driven
strategy is an investment that can deliver unique value to cus-
tomers and superior return to the company.
Offensive marketing is an approach to building long-term, sus-
tainable shareholder value. The use of offensive marketing enables
the customer to drive demand and business systems, offering an
aligned approach to creating an effective and sustainable business
offering. Examples throughout the book, starting with Harley
Davidson, document the success that commercial enterprises can
have being “offensive.”
This book offers us one of the first truly comprehensive looks
into using marketing not only tactically, but also strategically.
From the first chapter, which highlights the five elements of the
offensive marketing approach—summarized by the mnemonic,
POISE—Keegan and Davidson describe the road map and neces-
sary rules of engagement for the “offensive” organization.
The goal of any commercial enterprise should be above-
average, long-term profitability—the “P” of POISE. The authors
vii
FOREWORD
challenge the purely financial view of profit, understanding that
profitability is the reward for meeting customers’ needs. They
rightly assert that profitability cannot be viewed in isolation from
other related goals of the enterprise, and they propose a marketing
alignment process that matches markets, customers, and channels
with competencies and assets of the organization.
An offensive attitude—the “O” of POISE—is an imperative
ingredient of the offensive marketing approach. Despite many
recent popular treatises on the topics of organizational culture and
leadership, Offensive Marketing recognizes that many companies
continue to lack an effective offensive attitude. Instead they cut
costs, undertake “initiatives” and housekeeping efficiency, over-
reward top executives, and think more about their share price than
their customers.
Integrated marketing—the “I” of POISE—is fundamental to
Keegan and Davidson’s enterprise-wide approach to marketing.
Integrated marketing means that every component of the business
combines to deliver superior customer value at minimum cost. The
integrated marketing concept and program formulated here is
broader than the application of the term to describe a more narrow
approach of combining various marketing communications. By
using the original, broader use of the term, Keegan and Davidson
challenge senior managers to use marketing as an approach to
business rather than solely as a specialist discipline.
It is under this topic that the authors discuss integrated strate-
gic planning, a concept that is inherently different from the con-
ventional approach consisting of revenue, cost, and profit
objectives. Marketing-driven planning focuses instead on the
future needs of markets, customers, and consumers. Marketers
rightly take the lead in facilitating and bringing their knowledge
base to this interdepartmental dialogue.
Under the “S” of POISE, the authors discuss the strategic ele-
ments that go into the crucial analysis that comes before determin-
ing winning strategies. Under the first of four chapters, Keegan
and Davidson offer an in-depth discussion of the requirements for
effective business analysis, which, all too often, is left out by cor-
porate decision-makers.
The authors discuss the importance of strategies, objectives,
and planning and highlight the requirements for effective business
analysis. They discuss issues raised by the internal business audit,
the competitive analysis drill, and the application of what the
viii
FOREWORD
authors term “key success factors,” which reveal business per-
formance strengths and weaknesses.
Next, Keegan and Davidson appropriately address the need for
strategic planning and insight to grapple with anticipating the
future. Developing a distinctive future outlook enables the offen-
sive marketer to shape corporate strategy and meet future oppor-
tunities ahead of competitors. It is here that the authors correctly
identify how marketers are losing influence over the strategic plan-
ning process; marketers repeatedly fail to grasp the initiative to
drive companies into the future by taking control of the long-term
planning process.
Continuing to develop the systematic offensive planning
approach, the authors aptly address the development of winning
strategies and the creation of strong marketing plans. They
challenge corporate decision-makers to use offensive strategy to
build competitive advantage through the concentration of
resources aimed at the areas of best return. Portfolio analysis and
the most frequently used tools of the trade are well evaluated.
Lastly, the authors adeptly address an issue that is often left out of
the analysis, namely, assessing strategic fit with corporate
resources, other opportunities, and expected competitor response.
The cultivation of marketing plans and the marketing planning
process is then put into its full context. As acknowledged by the
authors, many aspects of marketing planning are technical and
practical. Accordingly, Keegan and Davidson bring important
insight to marketing planning tools and discuss key questions that
often arise in marketing planning. As many books on market plan-
ning fail to bring a sense of sequencing and timing to the endeavor,
Keegan and Davidson’s approach is illuminating and informative.
The remaining seven chapters of the book address effective exe-
cution—the “E” of POISE. They cover in detail the important topics
of offensive segmentation, brand development, new product devel-
opment, marketing communications, market research, effective
pricing strategies and objectives, and channel marketing. Each topic
is explored in detail with many relevant issues updated for today’s
technology and customer-driven marketing environment. For
example, after discussing the important principles of segmentation
and the factors driving its use, Keegan and Davidson outline the
practical applications of segmentation, a number of its more promi-
nent pitfalls, the characteristics distinguishing offensive segmenta-
tion, and a five-step process for developing segmentation strategies.
ix
FOREWORD
In the same vein, Keegan and Davidson’s twelve conclusions about
brand development are important reading to set the stage for
strategic brand management, a critical marketing skill. Perhaps the
most vital conclusion discussed is that brands are not just names
but are business systems.
The authors’ approach to new product and service develop-
ment is distinguished by tying success in this arena to rigorous
analytical and planning processes as well as to a delineated process
of building competencies in innovation and development. The
authors demonstrate how conducting a profit gap analysis, utiliz-
ing the marketing alignment process, and following a systematic
process that integrates input from various stakeholders vastly
increases the success rate of new product and service offerings.
In their discussion of offensive communications strategy,
Keegan and Davidson confirm that much of communication strat-
egy remains the same despite broad changes in technology and the
ability to reach individuals with personalized messages through a
myriad of channels. However, some issues have certainly become
more complex including creating an integrated marketing commu-
nications program.
The authors’ introduction to the chapter on offensive market
research begins with the line, “All is not well in the world of mar-
ket research.” So true. Between ROI issues and the questionable
relevancy of research that seems to confirm past results, offensive
market research needs to distinguish itself as a “frontier” for the
exploration of consumer understanding with “big picture” rele-
vancy not tactical implications. Out of this conviction, Keegan and
Davidson push market research to strongly cultivating customer
intelligence. Vital suggestions and an eight-step process for design-
ing and implementing effective market research plans propel com-
panies toward this goal.
Pricing decisions, as pointed out by the authors, are inherently
one of the more difficult issues to address. In fact, pricing often
becomes a compromise between targeted volume and market
share, and profitability and financial goals. To help solve these dif-
ficulties, Keegan and Davidson introduce an effective five-step
process for offensive pricing, which begins with the “value equa-
tion.” By doing so, price effectively translates products or services
into value propositions that can then be compared to other market
offerings and, during the pricing process, synthesized with an
overall strategy.
x