The World Marketing Summit:Creating a Better World Through

Marketing

Dhaka, BangladeshMarch 1-3, 2012

Philip KotlerKellogg School of

ManagementNorthwestern University

• This is the world’s first World Marketing Summit.

• Eminent speakers (economists, marketers, psychologists) coming from 20(?) countries.

• Over 3,000(?) delegates attending the talks also coming from several countries.

• Theme is “Creating a Better World Through Marketing.”

• WMS will focus on how marketing can improve lives in four areas: Health, Education, Environment, and Food

• WMS is unique in establishing eight continuing incubators around these themes to advance human knowledge and well-being.

Today’s ScheduleToday’s ScheduleFacts about World Marketing

Summit

Welcome to "the new normal"— a two-speed world in which two types of economies are emerging:

1.On the one hand, rapidly developing countries such as China, India and Brazil are characterized by high growth but low average household income. With GDP ranging from 8% to 12% and some 2.6 billion people, these markets are hard to ignore.

2.By contrast, the low growth countries -- most of the U.S. and Western Europe, for instance -- have a slower rate of economic growth but higher household incomes. With GDP growth of only 1% to 4%, these economies are expanding more slowly but their populations have higher salaries -- and more to spend.

Now…the rise of two­speed world

Source: Knowledge@Wharton

The Strategic Trajectory for a Growth Country

• Low cost, average quality domestic products.

• Low cost, average quality domestic products exported.

• Low cost, good quality products exported.

• High-end products made for other companies.

• Branded products (regional).

• Branded products (global).

• Dominant brands (global).

The Strategic Trajectory for a Growth Economy

POSTWARSOARING

TURBULENTUNCERTAIN

ONE-TO-ONE

FINANCIALLY-DRIVEN1950s1960s

1970s

1980s

1990s

2000s

• The Marketing Mix

• Product Life Cycle

• Brand Image• Market

Segmentation• The Marketing

Concept• The Marketing

Audit

• The Four Ps

• Marketing Myopia

• Lifestyle Marketing

• The Broadened Concept of Marketing

• Targeting

• Positioning

• Strategic Marketing

• Service Marketing

• Social Marketing

• Societal Marketing

• Macro-marketing

• Marketing Warfare

• Global Marketing• Local Marketing• Mega-marketing• Direct Marketing• Customer

Relationship Marketing

• Internal Marketing

• Emotional Marketing

• Experiential Marketing

• Internet and e-business Marketing

• Sponsorship Marketing

• Marketing Ethics

• ROI Marketing• Brand Equity Marketing• Customer Equity

Marketing• Social Responsibility

Marketing• Consumer

Empowerment• Social Media Marketing• Tribalism• Authenticity Marketing• Co-creation Marketing

The Evolution of Marketing

The Four Tasks of Holistic Marketing

Five shifts

Driving business Impact

Galvanizing your network

Pervasive innovation

Inspiring marketing excellenceRelentless customer

focus

From Traditional to Digital Media

Traditional Media• Face-to-face sales calls• Trade fairs• Leaflets, posters, brochures• Billboards• Newspapers and magazines• Direct mail and catalogs• Telephone • Radio• TV• Film• Sponsorships• Street level promotion and

festivals• Product placement

Digital Media• Websites• Email• Banners and pop-ups• Podcasts• Webcasts• Videocasts• Expressive social media

(Blogs, Facebook,Twitter,, Linkedin, YouTube)

• Collaborative social media (Wikipedia, Rotten Tomatoes, Craigslist)

• Mobile marketing

From Traditional to Digital Media

Power is Shifting to the Customers

• Consumers have now become the Brand Influencers – they are publishers, broadcasters and critics of different products and brands.

• Facebook has more than 750 million active users, Twitter users send 140 million tweets a day.

• YouTube’s 490 million users upload more video content every two months more than the three major U.S. TV networks created in 60 years.

• Mobile commerce is showing an annual growth rate of 40 percent.

• There will be a growth from 70 million tablets worldwide today to 300 million by 2015.

Source: The 2011 IBM Global CMO Study of 1,734 CMOs in 19 industries and 64 countries, November 2011.

Power is Shifting to the Consumers

Types of Innovation

Product and service

incremental innovation

Product and service

incremental innovation

Business model

innovation

Business model

innovation

Marketing innovationMarketing innovation

New to the world

innovation

New to the world

innovation

Source: http://2.bp.blogspot.com/_qD9Y8Ncd3I4/Sb6hKKOJkJI/AAAAAAAACDo/fHZHCQbvRe4/s400/BornToInnovate2009.jpg

Types of Innovation

EVOLUTION OF MANAGEMENT THINKING

1950s – 1960s

1950s – 1960s

1970s – 1980s

1970s – 1980s

1990s – 2000s

1990s – 2000s

2010s – 2020s

2010s – 2020s

Evolution of Marketing Thinking

Comparison of Marketing 1.0, 2.0, and 3.0

INDIVIDUALCOMPANY

Mind Heart Spirit

DeliverSATISFACTION

RealizeASPIRATION

PractiseCOMPASSION

Profit Ability Return Ability Sustain Ability

Be BETTER DIFFERENTIATE Make aDIFFERENCE

MISSION(Why)

VISION (What)VALUES

(How)

Values-Based Matrix (VBM) Model

Values-Based Matrix of S.C. Johnson

Marketing 1.0 Marketing 2.0 Marketing 3.0

MIND HEART SPIRIT

PRODUCT-CENTERED

CUSTOMER-ORIENTED

VALUES-DRIVEN

ECONOMIC- VALUE

PEOPLE-VALUE ENVIRONMENT- VALUE

PROFITS SOCIAL PROGRESS

HUMAN HAPPINESS

MOVING TOWARD MARKETING 3.0

•Where is your company now?•Where do you want it to be?•Why?•What would steps would you take?

Where Do You Stand?

Leader Brand Mission and VisionIngvar Kamprad IKEA Make stylish furniture affordableRichard Branson Virgin Bring excitement in boring

industriesWalt Disney Walt Disney Create magical world for

familiesHerb Kelleher Southwest Airlines Make flying possible for many

peopleAnita Roddick The Body Shop Embed social activism in

businessBill Gates Microsoft Realize ubiquitous computing

Steve Jobs Apple Transform how people enjoy technology

Jeff Bezos Amazon.com Provide the biggest selection of knowledge delivered conveniently

Examples of Great Missions and Vision

Companies Americans Love

Amazon, Apple, Best Buy, BMW, CarMax, Caterpillar, Commerce Bank, Container Store, Costco, eBay, Google, Harley-Davidson, Honda, IDEO, IKEA, JetBlue Johnson & Johnson, Jordan's Furniture, L L Bean, New Balance, Patagonia, Progressive Insurance, REI, Southwest, Starbucks, Timberland, Toyota, Trader Joe's, UPS, Wegmans, Whole Foods.

These “firms of endearment” were highly profitable. They outperformed the market by a 9-to-1 ratio over a ten-year period. More fulfilled employees, happy and loyal customers, innovative and profitable suppliers, environmentally healthy communities.

Characteristics of “Firms of Endearment”

• They align the interests of all stakeholder groups • Their executive salaries are relatively modest• They operate an open door policy to reach top

management• Their employee compensation and benefits are high for

the category; their employee training is longer; and their employee turnover is lower

• They hire people who are passionate about customers• They view suppliers as true partners who collaborate in

improving productivity and quality and lowering costs• They believe that their corporate culture is their greatest

asset and primary source of competitive advantage.• Their marketing costs are much lower than their peers

while customer satisfaction and retention is much higher.

Characteristics of Firms of Endearment

What are some major social causes that companies adopt? AvonAvon Breast cancerBreast cancerGeneral MillsGeneral Mills Better nutritionBetter nutritionGeneral MotorsGeneral Motors Traffic safetyTraffic safetyHome DepotHome Depot Habatat for HumanityHabatat for HumanityKraftKraft Reducing obesityReducing obesityLevi StraussLevi Strauss Preventing AIDSPreventing AIDSMotorolaMotorola Reducing solid wasteReducing solid wastePepsi ColaPepsi Cola Staying activeStaying activeShellShell Coastal cleanupCoastal cleanupPetsmartPetsmart Animal adoptionAnimal adoptionAleveAleve ArthritisArthritisBritish AirwaysBritish Airways Children in needChildren in needStarbucksStarbucks Tropical rainforestsTropical rainforestsBest BuyBest Buy Recycle used electronicsRecycle used electronics

See Philip Kotler and Nancy Lee, See Philip Kotler and Nancy Lee, Corporate Social Responsibility: Doing Corporate Social Responsibility: Doing the Most Good for Your Company and Your Cause, the Most Good for Your Company and Your Cause, Wiley 2005.Wiley 2005.

What Are the Major Causes That Companies Invest In?

What is the Relationship between Business and Society?

• Old philosophy: “What is good for business is good for society!” The simple act of profit maximization is good enough.

• New philosophy: “What is good for society is good for business.” (GE)– Every company should figure out not only how to

improve its output but also its outcomes. A food company should improve nutrition; an energy company should improve energy; a bank should improve sound savings.

Michael Porter and Michael Kramer, “The Big Idea: Creating Shared Value,” Harvard Business Review, January/February 2011.

What is the Relationship between Business and Society?

thanzyl@markandcomm.com. Creating shared value (CSV)

Economic Growth

SustainabilityRecession

Global poverty

Consumer Life Styles and Well-Being

Develop the social responsibility side

your business

Develop the Social Responsibility Side of Your Business

Empower your marketing engine…

1. See crisis as opportunity.

2. Go to where the growth is.

3. Engage marketing to drive your future.

4. Intensify your online and social media activity.

5. Develop the social responsibility side of your business.

To Win at Marketing,…

“Your thoughts and actions will flow into the rest of the world.”