Marketing Update | March 2010 | Review of Don Schultz's AMI Breakfast Seminar

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MARCH 2010

West, meet East: Marketing urged to transform to stay relevant

Event review by Jacqueline Burns

Jacqueline Burns is National Marketing Manager for MWH, a global engineering, construction, technology and consulting company, and a former AMI NSW councillor. She is also a freelance writer who writes regularly on marketing, management and technology. She blogs when inspired about things that move her.

On first impression, Don E. Schultz looks like a westerner, is the age of a Baby Boomer, and sounds like an American.

In fact, Don E. Schultz lives like a global nomad, has the outlook of the much younger ‘Y’ generation, and could easily reinvent himself as an eastern philosopher. Until then, he is Professor (Emeritus-in-Service) Integrated Marketing Communications at Northwestern University and, as President of Agora Inc, consults and lectures on global marketing, communication and branding.

Schultz addressed Institute breakfast seminars in Sydney and Brisbane. Speaking at the Sydney seminar, Schultz addressed a 100-strong audience on the need for marketing to transform, not transition – and on how western management styles must be reinvented to be relevant to emerging economies.

“I was asked to speak at a CEO conference in Beijing last September. I got up and started waving my arms in the air, telling them how smart we are in the US and how they [the Chinese] should try to copy us and do all the things that we’ve done – and how if they do that they can end up where we are …”

The next speaker was quick to point out where America now is – in crisis. Subsequently, Schultz has come to recognise that marketing does have a distinct western bias.

“It’s all about our culture, not about our customers’ cultures,” Schultz said. “I think what the Chinese were saying was that our marketing concepts don’t fit them culturally – they may fit mechanically but they don’t fit culturally. So one of the things we have to rethink is how do we really start to develop global concepts. Marketing is individualistic – we focus on the individual customer: what do they like, do, want … But most of the emerging cultures are communal in one form or another – what the group wants, what the group needs … We don’t have any way of doing that in marketing today,” Schultz said.

Pictured right are AMI Chief Executive Officer Mark Crowe, presenter Don E. Schultz, and NSW Council Deputy President Kathy Hatzis.

For more photos from this event,
see below

“Marketing as we practice it works really well when customers are dumb. When they’re smart, it doesn’t work as well. Technology has changed the world because it’s given customers access to the information. What can we tell them that they don’t already know or can’t find for themselves? That’s the real challenge for marketers. In six keystrokes and two-tenths of a second, every bit of information, anywhere in the world, is available to a consumer today: g-o-o-g-l-e.”

By extension, marketing now occurs at the speed of customers, not at the speed of competitors. “We love the four Ps because we control that system – we decide what we make, where we make it, when to make it, how much we’re going to charge for it, what to tell people about it… What’s driving us crazy is now consumers have that same knowledge and they’re essentially saying they want to be involved every step of the way.”

Apple is a great example of how a company can adapt to the open source movement. There are already thousands upon thousands of iPhone applications, each developed by a consumer who wanted to help create something that could be attached to Apple equipment.

Schultz shared insights from one of his longitudinal studies of media consumption. His latest research delves into the impact of foreground and background media: consumers are regularly simultaneously exposed to multiple forms of media but which media are they giving their attention to? Which mediums are accessed? Which do they prioritise? What media do they use in combination? What media has the greatest influence on product purchase?

He said: “What is an audience today? Is a TV audience people in the room with the set on or is it people talking back to the television? We buy full audiences but we might not get full attention. Are you watching TV while also flipping through a magazine or are you flipping through a magazine while simultaneously watching TV?

“Only the consumer can determine what they’re doing. We don’t know which one of multiple media they’re giving their attention to. They separate these things out; they create their own media systems for themselves.”

Schultz is convinced that the amount of time spent with media today is not as relevant as whether it is marketing intensive. For example, you are exposed to a dozen TV commercials during a two-hour movie versus you are exposed to a dozen messages in a five-minute period online.

“It’s about how intensive it is, not how much time you spend with the media. The problem we have of course is we equate time to importance and it may or may not be. So part of the issue here is we have to reinvent the way we think about media and media distribution.”

In closing, Schultz rallied for marketers to get back to the future. “All of the traditional measurement systems rely on historical attitudinal data. We’ve got really great measures for yesterday but practically nothing for tomorrow. We need to build predictive models. We in marketing continue to use old models simply because they’re in place. Everyone agrees with them; no one knows what they mean… we deal with smoke, mirrors and myths and that’s part of our problem.”

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Seen at the breakfast seminar ...