Marketing and Sales: Never shall the twain meet?

I was recently taking a class on sales management, and the inevitable questions of sales vs. marketing, what is the difference between the two, and where is the handoff from one to another came up. It is interesting that among practictioners in organizations there is an almost religious belief that the two are by nature adversorial and the two 'camps' engage in more finger pointing than any other closely related departments, especially in B2B scenarios.

There are some real differences. For example, the perspectives differ in terms of time range and distance from the sale transaction. Marketing tends to be medium and long term gazing into future sustainability while sales is about present survival. Marketing is about markets defined by some delineating parameters while sales is about the current opportunity that can be addressed by current products and services. Marketing is strategic in terms of the universe of opportunities, all competition, market and technology trends while sales is tactical about specific opportunities, strategies to close the deal on the table, and contextual competition. Marketing's job is to help the company consistently be among the top buying choices while sales is about making it the only choice. Marketers tend to be analytical, company biased, creative trend-spotters and value oriented while salespeople tend to be emotionally intelligent, situationally creative, prospect biased and revenue oreinted. And one can go on...

The trick is to be able to align the two in their objectives and identify the areas of cooperation in the buying funnel. There should be no clear handoff point but like in a relay a stretch where both are running and the baton is exchanged at the most optimal point. Kotler et al have dealt with this alignment in a HBR article "End the war between sales and marketing" well. they provide both a diagonstic to determine where your sales and marketing alignment is and in what circumstances should you try to move to a higher level of alignment among four defined levels - undefined, defined, aligned and integrated.

In my experience, the lack of alignment in any organization is directly proportional to the CEO's or top management's perception of value in the two functions, and unfortunately you find more of them giving short shrift to marketing than they do to sales. As a marketer, this misalignment usually leads to a disproportionate time being spent on downstream (tactical) marketing activities which is a losing proposition over time if the upstream (strategic) is not given its due.

Time Pass - a need or a brand?

If you have ever lived in Bombay (Mumbai), you would have travelled in the crowded trains bracing yourself for the one hour or more journey to the station nearest to your home. Other than the real regulars who corner the best seats to play cards or have formed a group of common interest - be it talking about the share market ups and downs of the day, for others it is one of patient waiting. Suddenly, you will hear a vendor shouting 'time pass, time pass, {product that he is selling, e.g. peanuts}, time pass'. The product could almost be anything - a puzzle, something to eat or do. But the real marketing insight that this group of vendors had was that they took a colloquial term for doing nothing of substance and used it to label the boring hour that you had to spend - literally pass time until you reached your destination. They named your need and offered something to fill it. Brilliant! I really don't know what to label it as - a need category or a genericised brand (ala 'fridge' or 'kleenex') except here you could substitute almost anything. If you really want to learn marketing and marvel at business acumen, look around you and they will be aplenty, like the ones on the downtown restauranteurs or the youngster with the scissors and glue that I wrote about earlier. They all executed flawlessly on the marketing process - observing their customers, intuiting what they need and then filling the need. If you are aspiring to be a marketer par excellence, that's what you need to do.

No Rawa Dosa, No Tea!

A quick explanation for non-Indians visiting the site :). Rawa is the South Indian word for samolina (coarsely ground wheat) and dosa is a thin pancake - more like a crepe.

Switch to my favorite city - Bombay or Mumbai to be PC. Mumbai like many megapolises of the world is busy, everyone in a hurry and space is at a premium. Many restaurants in South Bombay are very small with just a few tables sometimes as few as 4 or 6. During the rush lunch hour, most things on the menu are available in a South Indian restaurant but no Rawa Dosa and no tea or coffee. Why do you think that is? Simple - Rawa Dosa takes a relatively long time to cook on the pan (tawa) and people tend to dawdle over their tea and coffee after a meal. What is the restauranteur trying to achieve? Minimize the time spent by each patron at his most constrained resource - a table for his next customer to sit at. So he eliminates those items that either take longer to cook on order or to consume. Another important constraint plays on his mind - there is a short window of time (typically 2 hours, with the middle one hour really busy) for him to maximize his sales. To the student in you, he is managing table yield - revenue per table per hour. In fact to further enhance this, there is an unwritten rule quietly enforced by him and accepted by the busy Bombayites - you share the table with others if you or your party is not occupying all the seats - maximizing utilization at a given point of time.

And that is an astute businessman applying marketing thinking!

Industry specific marketing e.g. Retail Marketing

This post is in response to a student's question on whether retail marketing was different from marketing. As explained in the earlier two posts, where we defined marketing and expanded on the marketing act, marketing is an essential, strategic if not the most important function of any business as this blogger claims. Marketing foundational concepts and how we approach it are the same across all industries. Any good learning plan for yourself in marketing should cover all the basic tenets of the discipline which can be used across industries.

An industry is characterized by commonalities in the customer demographics, buying behavior, product categories and what needs they address, the value transformation process typically followed etc. Retail is an example of an industry. Within an industry, there could be finer segmentation e.g. grocery (Spencers), apparel (SVS), departmental (Lifestyle), product category specific (Croma), branded stores (Nike) etc. Other examples of industries are Automobile manufacturing, Auto ancillary manufacturing, Financial Services, Healthcare, Professional Services, Information & Communication Technology (ICT) etc.

With that background industry specific marketing is a no brainer. It is marketing as applied to a specific industry, where the practictioner has or develops a deep understanding of its customers, their buying behavior, the industry's value chain, levers of growth and profitability, various business models that the industry operates in, current market players etc. For example, in retailing, individual consumers or families are the focal point as end users. Factors and processes such as location, product delivery, store layout and ambience, merchandizing, buying, industry practices in terms of credit, returns and exchanges all are unique to the industry and need to be known to be a good marketer in that industry. I hope this helps students trying to distinguish between marketing in general and industry specific marketing, especially in India, where courses are now being offered e.g. in Retail Marketing or Insurance Marketing versus a MBA in Marketing. We will dwell on more nuances and differences in later posts.

The Act of Marketing

Many of you will hear or might have heard the expression: 'Let's do a marketing act on this' and it could be a piece of collateral or an event or a product launch. I cringe to the depths of my marketing soul, when someone says that after having decided on what is being referred to. The act of marketing is best executed from the beginning and not after the fact. Why do I say that? Planning for the lamest piece of collateral involves thinking about where and when it will be used, who we want to send it to, what will make them read it, and what behavior we want to elicit after they read it - all this before a single word is written. Or at least that is what an act of marketing is for me.

The act of marketing is about infusing value into every organizational activity that is trying to address the needs of the customer. Why the word 'infuse'? The dictionary meaning is: 'to introduce'; 'to instill'; 'cause to penetrate'. And that is what we try to do - introduce and instill value into everything we do. In the absence of value, the customer has no reason to engage with you. This ties back to our earlier definition of marketing of it touching every facet of the organization and animating it from creation to delivery of product or service, and capture of value.

Let me quote one of my favorite examples. In Bombay, near nearly every local train counter which issues ID cards, stands a young entrepreneur with a pair of scissors, a bottle of glue and a two pocket (one for the ID card and the other for the monthly train pass) plastic wallet. And the reason - the space for the photograph on the ID card is smaller than any standard photo size, for which you need a pair of scissors. The Indian Railways does not provide glue and therefore the glue stick. And the young entrepreneur charges you the price of the plastic wallet. What did you just buy? The time and cost value of the additional trip you saved, the money you saved for that day's train ticket or just being frustrated at the thoughtlessness of the railway authorities. And you weren't even thinking of buying a plastic wallet which had its own utility. And that is a marketing act par excellence!!

(It is also an example of business model innovation where the product or service that is being sold is different from what is actually being bought by the customer and we will talk about it in a later post. Some may argue that it is just a product being sold with services wrapped around it, but the more nuanced thinking throws up more market opportunities in general).