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July 26, 2006

Have the Old Rules of Marketing Collapsed?

Bernd Schmitt, who delivered the closing remarks at the Innovative Marketing Conference at Columbia Business School on June 8–9, discusses whether there is a new foundation for marketing.

Topics: Marketing

With all the talk about new paradigms, many marketers may wonder if the old rules are gone forever. First, it helps to identify what these old rules are. Some participants in last month’s Innovative Marketing Conference named the four P’s: price, product, promotion and place. Others said control: controlling the consumer, controlling your channels, controlling your competition, insulating yourself from it. Still others argued for targeting — target markets, target segments; or positioning — positioning against the competition or in the minds of the consumers.

Should we really cast these rules aside? No matter how much changes, some key marketing principles will hold true. We have to be innovative in creating new products. And we need to be relevant to customers. We rely on these strategy concepts — the analysis, the strategy development, the positioning, the targeting — as much as we always have. But the way we implement these concepts must change.

To some degree, of course, things have already changed. Whether you think these changes have been evolutionary or revolutionary is partly a matter of perspective. If you’re a little bit older, you probably see this as an evolution, because every ï¬???ve or 10 years, something comes along that experts say changes everything. If you’re a little bit younger, you’re probably seeing this for the ï¬???rst or second time, so you might say something truly radical is happening. I think it’s somewhere in the middle. There is a shift going on, and we are arriving at a new paradigm, but there’s still a lot of truth to the old rules.

Over the two days of the Innovative Marketing Conference, more than 130 marketing executives discussed what a new paradigm might mean. The audience identified many concepts as critical: transparency, community, social currency and trust. There’s also dialogue, engagement, conversations and co-creation.

The key, I would argue, is integrating all of these concepts — engaging in a conversation, creating value in terms of social currency, tapping into cultural meaning of brands. We have to pay attention to the more interactive qualities, the human face, of what we’re engaging in. That is really the new paradigm. But these concepts, and the notion of integration itself, have been grossly misrepresented or not represented at all in traditional marketing.

If we wanted, we could put this all into a PowerPoint chart. That’s part of what I do when I teach — I have PowerPoint slides and I talk about concepts and tools. But sometimes I feel there is more to this idea, and I think of it not in words or even images, but in terms of music.

One person that comes to mind is the composer Gustav Mahler. Mahler had a way of juxtaposing atonal passages with beautiful, traditional melodic lines. He was struggling with the entire Western tradition of classical music, starting with Bach and then going all the way through to Bruckner and his contemporaries. He saw a new age dawning, but he couldn’t fully express it yet.

In marketing, we’re in a similar vein. So what would be the music of our new paradigm? Would it be a frenzied, disjointed sax solo, full of squawks and blurts? Or are we approaching something along the lines of a slow, lyrical melody — a state of peaceful marketing and conversations with consumers that create new value like they’ve never seen?

There is a way to merge these worlds. I imagine the new paradigm as a jazzy improvisation. It’s upbeat, it’s a little edgy. It’s heavy on riffs. And we shouldn’t forget that this is, in a broader sense, another stage in our marketing evolution. Ultimately, we will reach a new, higher level of marketing. We are well on our way to making that happen.

 

Bernd Schmitt is the Robert D. Calkins Professor of International Business and executive director of the Center on Global Brand Leadership at Columbia Business School.

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