2020. 3. 5. 06:48ㆍ카테고리 없음
Value-based marketing strategiesIn business today marketing holds a paradox but the end result of such strategies will be ical p osition. All comp anies now claim to very unhappy shareholders who find the understand the imp ortance of brands and company is making no profits. Marketing and to be dedicated to developing An alternative tack pursued by some marstrategies that create value for customers. At keting managers intent on winning the conthe same time, the marketing function ap fidence of the financial director is to develop pears to be diminishing in influence and to strategies that maximise current profitability. Be disparaged as what the consultants McK Marketing expenditures are only proposed if insey called ' a millstone around an organisa they increase budgeted profits.
But this is a tion's neck '. A recent survey by KPM G hopeless trap for marketing. It means switchfound finance directors rated marketing in ing marketing spend from brand-building investment as the least important factor in con vestments to short-term promotions.
Tributing to a firms' long-term growth. They Because of the lagged effects of most brand also said marketing and advertising are the investments, cutting rather than increasing first things they would cut if under pressure these expenditures will always b oost shortto reduce costs. D o minic C adbury, Chair term p ro f itability. A fo cus o n maximising man of Cadbury Schweppes, summarised the profits is no help to anyone. Situation, ' marketing has a struggle to b e The starting p oint for increasing markettaken seriously in the b oardro o m and the ing's credibility in the boardroom is to propnotion of marketing as a source of comp eti erly define its obj ective. Today virtually all tive advantage is regarded with suspicion'. 1 maj o r c o mp anies accept that the primary The central p roblem is caused by market task of management is to maximise returns ing's failure to integrate itself with the firms' to shareholders.
The rationale for this goal basic obj ective of maximising shareholder lie in the property rights of shareholders and value. Marketing suffers both as a profession in capital market pressures to oust chief execand an academic subj ect from having hazy utives that do not deliver c o mp etitive reobj ectives. Most marketing professionals be turns. The obj ective of marketing needs to lieve that the obj ective of marketing is to in be redefined to align itself to this fundamencrease sales or market share. But for an tal business goal. It can be restated as follows: intelligent board of directors such an obj ective Marketing is the management process that is patently absurd.
Any first year economics seeks to maximise returns to shareholders by student can demonstrate that maximising sales developing relatio nships with value d cusor share is an extremely unprofitable strategy. Tomers and creating a competitive advantage. Another favoured goal of marketers is to de Acc epting this new concept of value-based velop strategies aimed at maximising customer marketing in no way weakens the traditio nal satisfaction. But again this makes little sense.
C ontribution of marketing; rather it e norLowering prices and increasing service can al mously strengthens it. To understand this ways increase customer satisfaction further, marketing managers need to appreciate h ow-shareholder value is created. S hareholdervalue is the return investors obtain over ap eriod in terms of dividends and share priceappreciati o n. This return is based o n thesum of all the firms' anticipated future economic p rofits, adj usted by an interest rateknown as the cost of capital. If investors getmore optimistic about the comp any's l ongterm prospects, the share price rises; if theybecome more p essimistic it falls.2The key p oint is that investors look atlong-term not short-run profits when valuing companies. I n fact current p rofits typic ally explain less than 5 p er cent of acompany 's value. Even profits over the nextfive years will usually account for less than 20per cent of the share price.
The evidence forthis is all around today. It explains why Amazon.
Value Based Marketing Strategy
Com, which has never made a profit, isvalued at twic e Cadbury S chweppes, whichmakes p rofits of nearly £600 million. I t alsoexplains why the share price usually dropswhen a company announces that it is cuttingadvertising or R&D.The shareholder value concept is anenormous p otential asset for marketing p ro fessionals because marketing i s t h e most imp o rtant determinant of the firms' ability toachieve long-term profitable growth. It doesthis in three main ways. First, in-depthknowledge of customers enables marketingprofessionals to identity new growth opportunities. For example, Peter D avies and hismarketing team transformed the stuffyPrudential to a dynamic financial services business by spotting the opportunities presentedby the Internet.
S econd, marketing leads thedevelopment of strategies to identity highvalue customers and to build lasting relationships with them. Virgin is a classicexample o f such marketing leadership. Finally, marketing builds long-term earningsthrough developing strong brands that obtain enduring b rand premiums. B rands likeCoca- C ola, McDonalds, Disney and Kodakare p owerful examples of how great brandscreate shareholder value.S hareholder value analysis (SVA) - a relatively straightforward financial tool using aPC-based spreadsheet - enables marketingprofessionals to demonstrate how the strategies they are p roposing enhance l ong-termearnings growth and pro duce specific, measurable increases in shareholder value. I t enables marketing and brand buildingstrategies to be ro oted in the b oardro om.The language o f top management is finance. I n the p ast marketing has been marginalised b ecause it has n o t b e e n able toc o mmunicate its c ontributi o n in financialterms.
S VA c o uld change all this fo r marketing managers making them key playersin designing corporate strategies to enhancethe firms' market value.S VA encourages profitable marketing investments. C o nventional accounting treatsmarketing expenditures as costs rather thaninvestments in intangible assets such asbrands and customer loyalty. B ec ause thelong-term profit streams generated by suchinvestments are ignored, marketing in mostbusinesses is underfunded. SVA, however, isfuture orientated: it encourages the l ongterm effects of marketing expenditures to beexplicitly estimated. M any b rand-buildinginvestments that would be quashe d undertraditional accounting pro c e dures b e c ausethey reduce current profits will b e shown tob e value creating under SVA. SVA also p e nalises arbitrary cuts in marketing budgets. Itenables marketing managers to demonstratethat such cuts destroy value by eroding longterm market share and brand premiums.If marketing n e e ds S VA to b e credible,the shareholder value movement also needsmarketing.
S VA is a tool fo r evaluatingstrategies: it enables the b oard to c h o o s eb etween alternative p olicies. But what SVAcannot do is to create the strategies in thefirst place. All too o ften this role has b e e nfill e d b y financial management who havefo cussed on rati onalisatio n as a way of increasing value. But what is clear to day isthat growth is the most effective way ofcreating value for shareholders. All the companies that have created the greatest shareholder value in the last decade: Micro s o ft,D ell, C harles S chwab, Intel, the Gap havebeen high growth c o mpanies with strongbrands.
O nly marketing fo cuses on the professional skills to create such strategies.Peter DoyleEditorial Board( 1 ) Butterfield, Leslie (ed.) ( 1 999) 'Excellence in Advertising', Butterworth-Heinemann, Oxford.(2) For a comprehensive account of shareholder value analysis see Copeland, Tom, Koller, Tim and Murrin, Jack ( 1 996 ) ' Valuation: Measuring and Managing the Value of Companies', Wiley, New York.
A seminal work - reformulating marketing around creating shareholder value.For the first time, marketing is integrated with the governing objective of management. A practical, step-by-step guide to developing marketing strategies that generate growth and shareholder value. An essential text for top management and MBAs.Marketing has not had the impact on management that A seminal work - reformulating marketing around creating shareholder value.For the first time, marketing is integrated with the governing objective of management. A practical, step-by-step guide to developing marketing strategies that generate growth and shareholder value.
An essential text for top management and MBAs.Marketing has not had the impact on management that its importance merits. This is largely due to its unclear objectives and weak intellectual foundations.Value Based Marketing reformulates marketing, making its goals more relevant and establishing it on a sounder intellectual basis. The governing objective of management in all of today's leading companies is to maximise long-term returns to shareholders. The book redefines marketing's role as contributing to this task of shareholder value creation. It explores how this affects marketing planning and decisions about brands, pricing, communications, distribution and the Internet.The increasing emphasis placed on the financial technique of shareholder value as a means for measuring a company's performance has provided a major opportunity for marketing managers: the ability to increase greatly their sphere of influence in setting their company's strategic direction like never before. The book provides a clear practical introduction to shareholder value analysis and provides practical tools for translating marketing ideas into the financial framework used by modern boards of directors.For top management and CFOs, the book explains how marketing generates shareholder value. It shows how top management should evaluate strategies and stimulate more effective and relevant marketing in their companies.