Another Form of the Good Will Marketing

In January 2007, I wrote a sharing with a title towards the good will marketing which combines the marketing and public relation strategy. This sharing outlines how to be a good company within the society by being a philanthropist and how the good will actually increases the awareness of the society towards the company. Moreover, this practice will allow us to give back to our society since we are living in the society.

I March 2007, I revisited the good will marketing with another approach. I believe that all manufacturers must have a good will towards their distributors and retailers. They always try to keep the good profit margin by creating the healthy competition in the market. They would not allow people that will sell at discounted price to enter the market easily since this would kill the rest of the network. Moreover, they would also kill the positioning and the branding of the products.

For the third time I would like to point out the importance of the good will marketing within the business. Have you heard the name Enron? Have you heard the name Arthur Andersen? Hermawan Kartajaya stated that business has to be conducted in honesty in order to be sustainable. I personally believe that true honesty, good wills, and great management skills that would create a sustainable business.

Enron employed around 21,000 people (McLean & Elkind, 2003) and was one of the world's leading electricity, natural gas, pulp and paper, and communications companies, with claimed revenues of $111 billion in 2000. Fortune named Enron "America's Most Innovative Company" for six consecutive years. It achieved infamy at the end of 2001, when it was revealed that the reported financial condition was sustained mostly by institutionalized, systematic, and creatively planned accounting fraud. Enron has since become a popular symbol of willful corporate fraud and corruption.

Arthur Andersen was once one of the so-called "Big Five" accounting firms (the other four are PricewaterhouseCoopers, Deloitte Touche Tohmatsu, Ernst & Young and KPMG), performing auditing, tax, and consulting services for large corporations. In 2002 the firm voluntarily surrendered its licenses to practice as Certified Public Accountants in the U.S. pending the result of prosecution by the Department of Justice over the firm's handling of the auditing of Enron, the energy corporation.

It is so amazing how giant companies like Enron and Arthur Andersen abruptly disappeared and bankrupt because of merely not being honest to the public. This example really shows how a leader in one situation does not mean an eternal leader. Their bankruptcies really affect the global business climate. After the September, 11 attack the New York Stock Exchange (NYSE) suffered bear market for a month. However, when Enron case happened it suffered a three months bear market. How many people being redundant after the falling for these giants? The answer is too sad to be true.

Comments, opinions, and questions are greatly appreciated

David Herlambang
MarketingFirst

Towards the "Good Will" Marketing Revisited

I would like to share a little experience that might be useful for the rest of the members. As a marketing director I was sent by my company to Melbourne for two days to present in a yearly exhibition called Australian Toys and Nursery Fair. This event is actually very important for every manufacturer, wholesaler, and retailer in the toy and nursery industry. This is the chance for manufacturer to exhibit their products and promote their creation to the wide range of wholesaler. To the wholesalers, this is a great opportunity to create more connections with retailers. Of course as a retailer, I found this exhibition is a great chance to recognize the latest trend in the industry, develop more contacts, and predict the future of the industry.

That was actually the first time for me to be there. I really did not expect that toy industry is actually THAT BIG!! The ranges of the categories were exhilarating. It started from art and craft toys, nursery products, extreme games, puzzles, board games, soft toys, learning and developmental toys, action figures, extreme hobbies, die cast, and the list goes on and on. The size of the companies that exhibited there also ranges from a very small company to the humongous sized companies, such as Mattel (the creator of Barney the Dinosaur, Barbie dolls, UNO, etc) and Hasbro (the creator of Monopoly, Sesame Street, Bratz dolls, etc).

My most important mission was to develop contacts to the great suppliers and manufacturers. As a retailer, especially a small retailer like us, it is important to secure the deal that enables us to obtain the great items. This deal will enable us to follow the trend in the industry. However, in order to secure the deal sometimes it takes more than just money. The ability to purchase a great value of transaction does not necessarily secure the deal.

Somehow some manufacturers and suppliers have a good will with their existing customers. They have the exclusivity secured in order to maintain the desired price of the products. As an online retailer I was rejected by some of the companies. Firstly, online stores usually sell items at crazily discounted price which could be lethal to the brand identity of the item. Secondly, the global internet market could kill the existing local conventional stores by eroding their market (an online store in America could sell to Australia).

At the end of the day, the manufacturers have spent millions of dollars to build their brand and of course it is understandable for them to reject me. Mercedes Benz is always meant to be a luxurious car. Therefore, discounted selling of Mercedes Benz would be lethal for them. You do not want to create confusion within the market towards your brand identity.

My question is: Is it another practice of the good will marketing by the manufacturers to their existing customers or just merely business tactic?

Feel free to contribute, you are more than welcome!!

David Herlambang

MarketingFirst

Advertising...Oh Advertising

Frankly, I am not a great fan of winter. This is because it requires me to dress like a bloody penguin to combat the unbearable cold weather. Summer, however, is like heaven for me. I can sun bask on the beach while enjoying the amazingly beautiful Australian nature and of course the bikini babes.

Another major attraction in Australia during summer is the Australian Open – one of the greatest sporting events in the nation. With millions of fans around the world, companies such as IBM, Garnier, KIA Motors and Medibank Private are willing to sponsor the event. These sponsors would be heavily and exclusively advertised both on the venue and on TV during the vents. Huge banners were displayed and TV ads were repeatedly broadcasted during the matches. Looking at all the advertisement, a question suddenly popped up in my mind. Are these advertisements effective? Are these sponsors paying too much for their campaign? How much sales can these advertisements generate?

Honestly, I have not bought any products from these sponsors before. Besides, people that I know of have not dealt with these sponsors either. In addition, I barely able to recall which advertisements actually appeared on TV nor I can remember what was on the huge banners displayed around the courts. How many of you have reacted to actually purchase products based on advertisement? When was the last time that you actually bought any product as a result of bumping into an advertisement broadcast?

I personally think that sometimes advertising has lost its value in communicating information of the product or service to the potential customers. Often advertisements are so creative that it could not be understood. Often we see advertisement which does not even put the wonderful values of the products in it. In my opinion an advertising dollar should be able to bring at least a dollar in sales to the company. The problem is the majority of marketers who I assume understand marketing simply define marketing as putting big advertisements to publicize their company. Surely marketing means more than throwing our money.

Classic marketing which means putting ads and waiting for customers to come was a real success more than a decade ago. In fact, this method turned Procter&Gamble, Coca Cola, and American Express to be the great leaders in their industry. However, this method is no longer applicable in the modern society. According to Al Ries in his book “The Fall of Advertising and The Rise of PR”, a person meets at least 300 advertisements daily. This number then creates an immune system in our brain towards the conventional advertising. Marketing should be energetic which means communicating actively with the potential and existing customers rather than waiting for them to come.

Google has not advertised its company even a single time. Their fame simply comes from the word of mouth. They basically focus on delivering what the customers are looking for which is the reliable information from their search engine. Before their success they asked their customers how google.com could be improved in order to be more effective and efficient. However a lot of marketers forget about this fact. They only concentrate on obtaining mind set of their potential customer. Mind set is nothing. You could remember how funny and creative an advertisement is without having any desire to buy the product. You could talk about an advertisement with your friends, but it does not mean that the advertisement create stimuli for you to purchase the product.

A supermarket in Australia conducted the good will marketing instead of merely throwing advertising dollars. At the beginning of January they dedicated a day profit for charity purposes. This marketing method is really creative since it allowed customers to participate in the charity as well as creating a chance to be impressive with their customer service. Moreover, for this particular event their company was then freely publicized by the mass media and the society due to their good will. It was a huge successful marketing campaign. Therefore, they managed to create a cause for their customers to come to their store and experience the customer service. These examples show that we have to be creative in our marketing not in our advertising.

In order to generate a great marketing strategy the combination of both advertising and Public Relation (PR) should be in harmony. Therefore, please do not ignore your PR department and merely depend on advertising in order to obtain publicity.

Welcome to the public relation age.

Comments, questions and opinions will be truly appreciated.

David Herlambang
MarketingFirst