Digital Disruption in Marketing and Communications

A Strategic and Organizational Approach

Edoardo Magnotta

• Publisher: Routledge
• Year: 2019
• Print ISBN:
  9781032087917
• eBook ISBN:
  9780429515460
• Topic: Business
• Subtopic: Marketing Research
• Index: Business

This book sets out the new frontier of marketing and communication through real case histories. Companies must rethink their traditional approaches to successfully face the upcoming challenges. They must learn how to innovate and change things when they go well. New emerging technologies such as AI and IoT are the new frontiers of the digital transformation that are radically changing the way consumers and companies communicate and engage with each other.

Marketing makes a company a change-maker, while communications tell the story to engage customers and stakeholders. The book introduces brand positioning (to match brand values and consumers' attributes), and brand as human being (to raise trust, loyalty and engagement among customers and stakeholders), through Enel X and its partnership with Formula E in the e-mobility case, and the PMI case (its disruptive effect on tobacco industry). After a deep analysis of the disruptive effects on business models of the digital transformation, the book explores digital communications through the Pietro Coricelli case (how a well-designed digital strategy can raise reputation and sales). The book also provides a new holistic approach and identifies a future leader, through the H-FARM case (how to disrupt business models and education).

The book is aimed at researchers, students and practitioners, and provides an improved understanding of marketing and communications, and the evolution of the strategic, organisational, and behavioural model.

1 Marketing in the future company

1.1 Introduction to the concept

Marketing has evolved over time through many different approaches and categories of activities. From the first product-based approaches oriented to promotion and communication, up to the consumer journey and the community engagement through the Digital Marketing, the pathway has been very long. In order to better understand the evolution of the marketing, it is useful to remind some definitions of marketing from different perspectives:

• Marketing is the management process responsible for identifying, anticipating and satisfying customer requirements profitably, Chartered Institute of Marketing (CIM).¹

• Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large, American Marketing Association.²

• Marketing means satisfying needs and wants through an exchange process, Philip Kotler.³

Today, marketing involves all activities ranging from the project of products or services aimed at satisfying actual or potential market needs (market research) to the product development (R&D and manufacturing) and the communication and sales process up to after-sales. The aim is to project and develop products or services that satisfy customer wants and needs, and retain customers along the time.

If we look at CIM’s definition, marketing should not be left to a specific department: everyone working or committing with a company should be responsible for company’s reputation and success. If we look at the definition of the American Marketing Association, marketing ranges from creating to delivering value to all the stakeholders of a company. If we look at the definition of Kotler, marketing means satisfying needs and wants through an exchanging process.

That means we can identify a common trait to the three definitions, as showed by the following table.

Figure 1.1 How to fit marketing definitions.

Marketing is not about providing products or services, but changing benefits aimed at satisfying changing customers’ needs and wants. The main mission is to constantly identify new or potential customers’ needs, and to deliver benefits rather than products, as those benefits will enhance customers’ lifestyles and will allow companies to retain them. To that aim, marketing has to set up the most consistent segmentation process in order to identify the best target market, that is to say, a set of buyers who have common needs and/or characteristics, which a company decides to serve and deliver benefits to.⁴ Somehow, marketing is not the art of finding ways to exhibit and show off what you do. Marketing is the art of creating real value through benefits that can help customers to improve. With this regard, marketing is also the art of positioning the company, its products/services, as well as the brand in the customers’ mind in order to make them understand how much strong the differentiation from competitors is. For example, Starbucks is not a simple cafeteria providing with fresh coffee: it gives a better coffee, many varieties to choose from and a completely pleasant experience in a place where you can enjoy having a coffee, and much more.

If we look at a past definition of Philip Kotler, considered the father of modern marketing, he talked about marketing as the set of activities that project, communicate, and deliver valuable benefits to the market. Moving further forward, marketing is a way to run and lead a company, not a simple company department. It is a continuous process that takes a lifetime to perfect it. Marketing is the art of identifying needs to satisfy as well as the best products and services for customers to do it. At the same time, marketing is also the art of communicating and delivering benefits and services as they create value and loyalty to customers. At the highest level, marketing is able not to simply identify needs and wants, but to create new needs, that is to say, new markets. The list of examples is long: when Steve Jobs was quite focused on creating a computer for each family in the world, he was focusing on potential needs, not yet expressed. The home computer market did not yet exist, and Apple created it. When Red Bull launched the first energy drink, the product was oriented to students in order to provide them with strong energy drink to well perform in the study. Coke and Pepsi already competed in the soft drink market, but Red Bull created the energy drink market through the creation of an unknown need. In this perspective, marketing must act as the change maker of an organisation in terms of innovation and value, in order to do what is strategically correct, that is much more important than what is immediately profitable.

Finally, the most recent challenge of marketing is customer retention, that means making possible customers repurchase products/services. To that aim, the best way to retain customers is to constantly analyse their habits and behaviours and to give them more for less. The more precise the target market and the more differentiated the offer, the more rewarding the strategy will be. Marketing will be successful when it forces the whole company to innovate and to make their own line of products obsolete before their competitors do. The intelligent marketers do not sell products; they sell benefits. Not only do they sell purchase value but also usage value. If the marketers are also able to deliver emotions and engagement, marketing will be a key strategic successful factor.

At a parallel level, public relations are constantly changing, even though they have always had to do with political power, as well as with the CEO’s influencing strength, both at a small company and at a multinational company. The Chief Communication Officer and the Public Relations Director are architects of relationships and builders of the authentic personality of an organisation.⁵

Public relations’ missions aim at building stable relationships and strategic links with public policy, as well as with all the stakeholders. Regarding the internal stakeholders, the mission is to assure consistency between organisations’ behaviours and the strategic brand positioning. To that aim, the contribution must go to the correct definition of the corporate identity in a close cooperation with marketing, as well as to build a responsible and transparent corporate behaviour in close cooperation with the human resources department.

In a pure communication perspective, a company has to deal with many channels and differentiated and customised contents. Marketing must build the differentiation and the positioning of the company, and communications must define how to communicate with and influence the internal and external stakeholders through a continuous ethical and aesthetic challenge. The ethical side is related to the transparent and authentic communication that must deliver real and true contents in order to build a deep trust between the brand and the market. The aesthetic side is related to differentiated contents addressed to different targets through different channels (form traditional media to digital media, and among the last ones, the differentiated use of Facebook rather than Instagram, or Twitter rather than LinkedIn, for example). Marketing should trace the strategic guideline and how to build and deliver value to loyal customers. Communication and public relations should facilitate the harmonisation of different and plural interests. They should also act as a bridge among different stakeholders in order to assure benefits to all of them. In the digital transformation, marketing, communications and public relations can use many innovative tools that can assure deep and immediate analysis in order to deliver customised and relevant contents, as well as to control reputation management, a real concern for the companies in the digital era. Company reputation can become an issue if we think to the speed and wideness of information that require an absolute control of the risk, a strong attention to the targets, a clear overview of all the channels, from the traditional media to the digital media (social network, blog, forum) up to opinion leaders and institutions, a deep knowledge of the corporate “look & talk”, that is to say, how the company/brand speaks to the stakeholders, and how the company/brand is perceived by them to the extent to combine everything in a strategic, communication, and visual planning together with marketing.

Strategic sharing between marketing and communication is the keystone of a real organisational and strategic innovation. As we will see in the next chapters, the CCO can give a strong contribution only at a C-level position, as a link-builder of different sources of knowledge in a company, and capable to think, study, and act for ethical, responsible, and sustainable behaviour. The role will be more and more strategic and complex, as it will have to deal with a wide range of different stakeholders, such as employees, media, investors, communities, customers, government departments, associations, donors. Communication and public relations will be more and more linked to:

• Marketing, because of the strategic positioning, the branding, and the digital strategy;

• Human resources, because of the transparent and loyal relationship with employees.

The declining public trust in institutions and companies, the need for ethical commitment in the governmental and business environments, are emerging issues. Marketing and communications will have to grasp new roles, contents, and meaning challenges. They have to do it together.

1.2 A general overview on marketing, communication, and their evolution

Marketing as a topic appeared in the United States in the first part of the twentieth century in courses related to wholesale and retail distribution. In a pure economic perspective, demand-and-supply curves only showed where price might settle, without explaining anything else regarding the chain from the manufacturer to the retailers, as well as relevant concepts such as the emotional behaviour or the identification of the target group with the brand. It happened that the early marketers filled in the intellectual gaps left by economists.

Marketing can represent many things, and, as we said in paragraph 1.1, marketing is basically a way of doing and running business. That explains why many people will originate brilliant marketing ideas without being trained as marketers. For example, Ingvar Kamprad was not a marketer, and yet IKEA is phenomenally successful in bringing well-designed, ...

Table of contents

• Cover
• Half Title
• Series Page
• Title Page
• Copyright Page
• Dedication
• Table of Contents
• List of figures
• Acknowledgements
• 1 Marketing in the future company
• 2 Communication and its link with marketing in the future company
• 3 From marketing to branding
• 4 The brand: the strategic role of a strategic asset
• 5 Communication and lobbying
• 6 The digital transformation
• 7 The innovative disruption of marketing and communication
• 8 The future company
• Bibliography
• Index