Strategic marketing: the six imperatives

Hello, I'm Noel Capon. I'm the R.C Kopf Professor of International Marketing at Columbia University, in New York. I'm also the Honorary Dean of MIC, that's the Marketing Innovation College in Beijing, China. You've probably guessed from my accent that I am British, so I have a pretty deep European background.

So one training of what we're going to do today, is to take a global perspective. But secondly, I'd like to say is that, for those of you who've taken a marketing course or did in marketing, there's one concept that is probably very familiar to you and that's the marketing mix, also known as the 4 P's. They've been a mainstay of marketing since back in the 1950s when they were first written about. They're really only one part, because I am taking a much broader strategic view. As you see, the title of this session is strategic marketing. I'm going to be talking about the six imperatives, and the marketing mix is in fact inside one of those imperatives. So that is the topic, strategic marketing, the six imperatives. Let's get into that by talking about, what I call the fundamental business model.

So what you see on this slide is my sort of broad, basic view of business. That is that in most companies, most of the time, what operating managers are trying to do, is to make current profits and get profits that will be in the future. So that's current and potential profits. If they in fact are successful in that goal, the organization survives and grows and shareholders get very happy. Shareholder value increases. You can also look at this from the negative side. If in fact, managers do not make profits today, or tomorrow, or the year after, then the firm goes out of business, and certainly shareholders get very unhappy. So this sort of fairly basic but really powerful relationship, costs and profits to survive and growth, and then the shareholder value. So the question becomes, what do we need in order to make profits. That is, what we have to do is to attract, retain, and grow customers. That's for any business. This doesn't matter what part of the world you're in. It doesn't matter what industry you're in. It doesn't matter whether you're an entrepreneurial start-up, or a much more established company. You have to attract, retain, and grow customers. If you do that successfully, all things being equal with respect to costs, then those good things will happen to you. Profits, survival and growth, and shareholder value. In order to attract, retain, and grow customers, what you must do as a company is deliver customer value. So here we have a really fairly simple, robust, and very powerful framework. The firm's job then, deliver customer value. If you're successful at that you will attract, retain, and grow customers. You will make profits, the organization will survive and grow, and shareholder value will increase. Now that, I think most of us probably would agree with that, there's just one problem with it, and that is this one thing missing. What's missing is competition. What we can see from this diagram is, that there are a set of competitors in a sense trying to do the same thing. So the job of the firm is not just to deliver customer value, it's got to do it better than the other guy. It has to deliver, what we call, differential advantage. If you do that you will attract, retain and grow customers. If competitors do a better job in terms of their value creation delivery, they will secure the customers and you'll go out of business. So very clearly then, the job is to attract, retain, and grow customers by delivering customer value.