Eventually I saw the light and found myself in a room filled with bright, smiling junior marketers. I had an hour to instil in them the kind of fear and loathing that had taken me a lifetime to achieve. I picked on topics that I wish someone old and fat had told me when I was young and keen. Here they are.

First, never ever talk about a logo. Ever. Most bosses believe marketing is pointless superficial piss, so the minute you turn up talking about a “consistent look and feel” and presenting different font options, you are confirming their worst fears about you and the discipline you work in. Hire an agency to present all the superficial fluffy stuff and stay above the fray.

There is no standard terminology in marketing and that can cause young people to freak out and lose confidence. Take the concept of brand positioning. In a typical week, you can hear it called brand values, value proposition, brand attributes, brand image, corporate reputation, brand purpose. They all mean the same thing but you need to have the confidence to work out that when some bozo asks if you know about ‘brand philosophy’, you understand what he is on about. Confidence, decent marketing training and a good bullshit detector will get you a long way in the industry.

Speaking of training, you need some. The only people who tell you that you don’t need a formal qualification in marketing are those that believe marketing is ‘common sense’ and ‘creative’. It’s neither and you need proper training to know what it really is all about.

The most important concept in marketing is the one the majority of marketers have not heard of – market orientation. Market orientation has a long and complicated origin but in a nutshell it means that you always have to remember that you don’t actually see the world like the consumer – you’re getting paid to work for the brand for starters – so don’t start making assumptions about what they want or feel. If you are market oriented, you don’t just do research, you depend on it because you know NOTHING.

Use market orientation in meetings. Too many marketers go into a room full of executives from their company and warble on about the need to build brand awareness and brand equity. No-one gives a fuck, except you – and presumably you are already on board. Good marketers work out how to link what they do with what other stakeholders within the organisation want – employee retention, improved profits, clearer leadership. You get the idea. Always have a good think about what everyone wants around the corporate table before you open your gob.

You will always underprice everything. There is loads of supercool research (that I cannot find anymore) that shows that when managers get the price wrong, 90% of the time they go too low. Marketers have an inbuilt bias for volume over value. Remember that because if there is one sin you cannot afford in marketing, it is low prices. They undermine brand, reduce profits and turn off your target customers. Horrible stuff.

Next, don’t even think about tactics until you have a target segment, a position (or whatever your firm calls it) and a strategic objective or two. All shit marketers care about is executional stuff – let them flounder down in the lower depths of our discipline. The social/digital revolution has changed the tactical options but the strategic game remains the same. Never move into execution until you know your target, position and objective.

Finally, the thing that will totally mess things up is time. It takes time to work out what is going on. Time to come up with a strategy. Time to develop the tactics. Time for the tactics to work. Time for the money to come. Unless you find a way to give yourself time your impact will be tiny – even if you made all the right strategic choices.

Read more:

• The best of Mark Ritson: Part 1

• The best of Mark Ritson: Part 2

Irrespective of the exact date, it’s clear that marketing is now more than a century old. Age confers many advantages – not least acceptance. Thirty years on, I can still remember the look on my beloved English teacher’s face when I told him I was off to Lancaster University to study Marketing and not Oxbridge to read English. “Marketing!” he exclaimed with the horrified look one might use on being told of an intended career as a heroin dealer or African warlord. “Marketing!”

Those days are thankfully over. But gentrifying marketing confers other risks. As our discipline ages and the concepts of marketing become established and embedded into the lexicon of everyday life, we risk forgetting what their original definitions meant and how we were supposed to apply them. Let me give you three very real examples.

Exclusive. It’s a word so beloved of modern marketing it has become paradoxically widespread. Traditionally the term has come to be associated with anything that carries a premium price. Now, you can buy exclusive ice creams or children’s toys or doorknobs (as I discovered last weekend). It’s all patent nonsense, of course. An exclusive brand is not simply one that fancies itself as such or one that attempts to charge more than its rivals. To be truly exclusive a brand must only appeal to a tiny minority of the market and then steadfastly reject all others. To be exclusive, at least in its original meaning, is to say to vast swathes of the market: ‘Piss off, I reject you from my brand and will do everything in my power to keep you out.’ Exclusivity demands that the traditional four Ps of marketing are not harnessed to generally maximise sales across the whole market but rather as a weapon that turns off, shuts down and closes out most potential buyers. There are very few genuinely exclusive brands left in the world but Ferrari is certainly one of them. I say that not because of its high prices or high quality, but because its most recent offering – LaFerrari – was only available to customers who already owned at least five previous models. That’s exclusivity for you.

Differentiation. At some point in the last fifty years the concept of differentiation became so generic that it was absorbed into every brand plan without exception. Let’s be clear what differentiated means – it means to walk a completely different path that no other brand in your category understands, let alone can replicate. A truly differentiated brand requires three key ingredients: a tight and distinctive positioning, a creatively charged set of executions and a brand manager with balls the size of watermelons – metaphorically speaking. To be differentiated is to take an axe to your category and exclaim: ‘Fuck it, let’s break everything.’ Again, there are few brands in recent years that one can point to as truly differentiated but I would hold up Benefit Cosmetics as a proper example. The world of beauty has become so serious and so very boring but Benefit is the differentiated exception. I defy you not to smile when you encounter them next.

And finally there is brand loyalty. It has become the custom to identify any customer that purchases your brand more than once as a ‘loyalist’. Alas, as most young agency types eventually learn, two consecutive nights of lovemaking does not a relationship make. To truly qualify as a brand loyalist in the original, intended meaning of the word is to exit the category and refuse to satiate your need because your brand of choice is not available. It’s an increasingly rare phenomenon these days but it still happens. My favourite (correct) definition of brand loyalty came from the former CEO and chairman of Heinz who once explained his idea of brand loyalty for his brand: “A shopper goes into a supermarket looking for some beans. There’s no Heinz. She comes out without any beans.” Could it be any simpler?

So there you have it. Marketing is an old profession these days and so are many of the concepts within it. But remember their original intent. There’s more power and direction in their traditional form than you might expect.

Twitter might be struggling at present as a corporate entity, but it still occasionally provides outstanding moments of quality social media. And by that I do not mean return on investment or conversations between customers and wood adhesives. I literally mean a social medium in which people interact with each other over a specific app or platform.

And so it was last week when my iPhone pinged to life with: “What is all this Gen Y, Z, millennials bullsh*t? Brains don’t change in a decade. We’re still driven by the same goals as our ancestors.”

I had no idea I followed Phil Barden, managing director at consulting firm Decode Marketing, but when his 140-character missive popped up last week I was jolly glad I did.

Barden is right, despite what you might have read in the 8,000 articles penned this week on the subject of millennials and how they are completely, unquestionably and massively different from the rest of us and how we are totally screwed unless we rip up our marketing plans and start again. It’s all total bullshit.

For starters, if you have been around longer than two years, you might have noticed that the ‘unique characteristics’ that define millennials are the bloody same traits we were ascribing to Generation Y not that long ago, and Generation X before that. You know the bit about how millennials want to ‘give back to society’? Or their ‘discomfort’ in traditional career roles? Or how they have a more ‘global mindset’ and ‘egalitarian principles’? And their literacy with new technology? These are not radical new psychographics, they are part of what sociologists refer to as ‘being young’.

I will hold my hand up. When I was a very inexperienced PhD student in 1994 I wrote a paper on Generation X and its implications for marketing. I got a free train ticket down to London and presented my bullshit paper to a bunch of old people who nodded and wrote stuff down as I went on about how Gen X were not looking for the same kind of career path as baby boomers and about how we cared about the environment and wanted a fairer world.

It might have been true at the time but it sure as hell wasn’t some new trait or one that Gen X would retain past a mortgage, two kids and the inevitable ball crushing reality of mortality gradually unveiling its ugly face every morning in the bathroom mirror.

And even if the bullshit about millennials is true, what, as a marketer, are you going to do with it? Remember how you were trained to avoid mass marketing and to reject broad assumptions about the market? Well, what do you think millennials are? The minute marketers start thinking all millennials are the same, they reject the behavioural and attitudinal nuances of a hugely heterogeneous population and collapse them into one big, generic mess.

If you buy the idea of millennials, then you must, by definition, reject the concept of proper segmentation and of consumers holding different perceptions and experiences. Millennials are essentially the same. They all have 0.3 kids, two-thirds of a degree and one testicle each. Whether they went to private school, have a same-sex orientation, have used your brand before, are female – all of that is trumped by their birth year and the cod-psychology of a bunch of assumptions about their demographically driven motivations.

The most disturbing problem with millennials is that they reinforce the ongoing love affair between marketers and young people that comes at the expense of their more populous, financially bestowed peers who happen to be – look away now – old.

I spent last week travelling around Canada (it’s a long story) with famed misery-guts Bob ‘the Ad Contrarian’ Hoffman. He was even more brilliantly miserable than billed and one of his great observations was that Americans aged 75 to dead will buy more new cars than those aged 18 to 35. Guess who appears in almost all the car ads?

Creating a constant yet changing demographic dynamic allows marketers to focus all their intellectual capacity and tactical efforts on young people and ignore the pasty old fuckers with all the money and buying intentions that they should be going after. And just as the youth segment starts to age and get interesting, we rewind up the age curve to the next revolutionarily different group of young adults.

The only thing that will kill our obsession with millennials is the deadening certainty that we are only a few months away from a new demographic cohort called Blah-Blahs or Generation Q, who will supplant the now over-the-hill millennials and surprise us with their, you guessed it, discomfort with modern career paths and concern for the environment and social justice.

When the Premier League season began in August Leicester City were favourites for only one thing – relegation. They had only just survived the drop during the previous season and their manager had recently been sacked after a team scandal. To make matters worse, Leicester had appointed Claudio Ranieri as his replacement. The Italian was available after being fired as manager of the Greek national team following a humiliating loss to the Faroe Islands. Little wonder then, that at 5000-1, Leicester winning the Premier League was seen as more unlikely than the Second Coming of Christ by most British bookmakers.

Six months later and we are still waiting for Our Lord and Saviour to return. But Leicester are sitting pretty at the top of Premier League. It is a remarkable story and one that marketers should pay special attention to. I am opposed to the typical horseshit analogies that derive extremely tenuous marketing insights from current cultural ephemera. You know the stuff I am talking about: What can marketers learn from the Kardashians / Lego / the North Korean missile crisis. But in the case of Leicester City and the remarkable Ranieri there are genuine lessons to be learned.

The first comes from Ranieri’s initial days at Leicester. As an Italian he had arrived with some clear notions about how the team should play. “When I arrived in August I started to look at the videos of all the games from the previous season. When I spoke with the players I realised that they were afraid of the Italian tactics,” he told Italian newspaper Corriere della Sera. “They did not look convinced, and neither was I. I have great admiration for those who build new tactical systems, but I always thought the most important thing a good coach must do is to build the team around the characteristics of his players.”

The first step in any future marketing success is diagnosis. I beat this into my MBA students in the first few weeks of their brand management course with me. It’s crucial not to arrive with established strategic approaches and a priori tactics already in place. Understand the new brand, the organisation behind it and the consumers that buy it. You only ever get one chance to perform a proper diagnosis so take your time here. Look for good secondary data, study the brand history and do as much in-market ethnographic work as you can.

The second lesson from Ranieri is his subsequent strategy. He quickly realised from his diagnosis that his new team was not exactly skilled in the art of possession football. Leicester’s starting eleven cost a total of £22m to assemble; that’s about half a Rooney. Ranieri realised he would not win anything if he tried to play the game like everyone else. Instead, he gave up on possession football and focused on his team’s overriding advantages – speed and an inherent work ethic. Typically, when a team wins in the Premier League they have on average 60% to 65% of the possession in matches. Leicester are winning each week, often by several goals, with as little as 35% possession. Rather than control games, they use their speed and tenacity to break quickly with lethal counter attacks.

The great insight here for marketers is to recognise that strategy is not associated with specific tools or tactics. It’s about genuinely studying the situation and your strengths and weaknesses to identify a clear and often distinctive way to win in the market. Who will we target? How will we win? How can we play the game differently from the rest? These are the great strategic questions that set the direction for brand success.

Finally, guided by a clear diagnosis and a distinctive strategic plan, Ranieri set in place the tactics to deliver results. Leicester play long ball football to allow fast breaks. They harry and hassle their opponents until they can win the ball and attack immediately. Their star players, Jamie Vardy and Riyad Mahrez, are encouraged to push forward and await the counter attacks that inevitably result from Leicester’s pressing approach.

Again, marketers can learn here. The tactical execution and the tools you use can only be applied after a clear strategic approach has been decided upon. Too many marketers are ready with tactical approaches but when you push them on the rationale for their execution it becomes apparent that the big strategic questions have simply not been asked. You cannot be a successful marketer with just content marketing or social media or CRM. These tactical choices are predicated on bigger issues.

Leicester will win the Premier League this year. Of that I have no doubt. Will marketers learn from this extra-ordinary achievement? I’m less certain.

Despite all the hullaballoo, the boldest and most famous example of wearable technology is currently floating, face first, in the ocean somewhere off California. In mid-January, we learned that Google Glass was no longer a going concern, at least in its present form.

The interesting question is why the much-hyped spectacles failed so badly. Clearly, it wasn’t to do with targeting. Google played a blinder two years ago by running a social media contest to recruit the first 6,000 customers for Glass. The contest created acres of publicity but also ensured that the first phalanx of Glass wearing customers were non-geeky, super cool, emotionally intelligent types, which the advertising world often refers to as ‘aspirational’.

You also could not fault the communication campaign that promoted Glass to the world. A seamless blend of social media and more traditional PR and events saw Glass feted globally from Vogue to The Simpsons to The Colbert Report. Everywhere you looked in 2014 you saw Glass. And no-one could accuse Google of getting the pricing wrong. There were raised eyebrows at the initial price of $1,500, but the scramble to get hold of them and the subsequent grey market activity on eBay suggest that the price was indeed right.

Distribution was equally well managed. With the exception of those few errant pairs on eBay, Google sold all their units direct, ensuring a perfect control of price, availability and targeting. The absence of big box retailers and their usual addiction to sales promotions also helped build brand equity.

The product itself worked well too. Even confirmed technophobes, like your humble columnist, looked at what it could do – audio without headphones, visual recognition software, recording video from real-time line of sight– and cooed appreciatively.

So where did it all go wrong? Marketing theory would suggest that if you have the right target and the correct mix of the four P’s, you will make a big heap of money. It’s taken me much time and analysis to come up with my thesis but I’m certain the fatal flaw in Google Glass was that it made people look like wankers, or, as they became known, ‘Glassholes’. Even if you were a super-thin, super-cool, supermodel, when you wore Glass you looked super stupid. And the reason for this was because the product was ugly. If you don’t believe me try a, ahem, Google image search for ‘people wearing Google Glass’. See what I mean? You get the usual blend of supermodels and, fashionistas but they all, without exception, look like wankers.

Google Glass was good for tech, but hopeless on the wearable dimension. The reason it failed so miserably on the latter is all about Google and its core competencies. You may remember the concept of “the core competence of an organisation” – it’s one of the simplest, and most important, theories of strategy and was invented by CK Prahalad and Gary Hamel in a blast of early 90s genius.

The authors posit that companies are good at some shit (I am paraphrasing) and less good at other shit. It may sound a trivial theory but, and I encourage you to read the full paper in the Harvard Business Review, it explains pretty much everything including Google and its Glass failure. It certainly explains why Google can build successful websites and email apps (clunky, plain, devoid of distraction, evolving with usage) and why its eyewear was always going to suck, big-time.

Prahalad and Hamel said that a firm should come to recognise where it lacks core competence and outsource these challenges to someone who can help out. In contrast to Google, Apple has the core competence of design thanks to Steve Jobs and his love for simplicity and appearance. He once famously said: “Design is the fundamental soul of a human-made creation that ends up expressing itself in successive outer layers of the product or service.”

There’s every chance that wearable tech might pause with Glass and only truly enter fast-forward mode when Apple’s Watch is launched. Glass is on the drawing board of a new design team who report to Tony Fadell, an ex-Apple executive. Hamel and the late, great CK Prahalad would surely approve the decision.

Your humble columnist was unconvinced. Attaching what appears to be a large tablet connected to a diver’s mask to your face appears to be a bit of a stretch when it comes to persuading consumers to do anything.

But I am very much in the minority when it comes to virtual reality and its potential. Every marketing magazine on the planet is now saturated with inane articles ruminating on the enormous game changing implications of the aforementioned digital frog masks for our profession. The very nature of our discipline is that anything new that most people have not heard of will instantly become feted as the next big thing for marketers, irrespective of how unlikely or unrealistic the item might actually be.

We have a long and illustrious track record of being inanely attracted to the latest flashing knobs of technology. Before virtual reality it was 3D printing. Last year you could not breathe without running into a jock from some tech start-up peering menacingly from behind a giant machine that was taking 36 hours to produce a very dodgy-looking yellow thing and a headline proclaiming ‘Why 3D Printing Changes Everything for Marketers’.

Go back even further and it was Neuroscience. Marketers were agog at the potential of insights derived from burying consumers inside giant technological sarcophagi and studying their brain responses to various marketing stimuli. Five years ago we were told that these new ‘neuromarketers’ were going to change the game completely and that companies were using neuroscience to develop amazing new insights into their consumers and how to influence them. The coverage was so extensive that we even started to see a counter movement opposed to the ominous new capabilities that neuromarketing conferred on the corporations who did it. The Huffington Post, for example, asked: ‘Who wouldn’t be concerned about a global corporation spending millions on “neuromarketing consultants” and appropriating the innocent toys of childhood in a high-tech scheme to change kids’ food preferences?’
It was all total bollocks of course. These amazing new insights largely consisted of very ambiguous brain scans that purportedly showed that when consumers thought about their favourite brands their brains (sometimes) showed slightly different activity compared to their response when they thought about orphaned puppies.

And who can forget Second Life? That was vintage marketing horseshit of the highest grade. Try and get marketers to go out and do some ethnographic research on real consumers in real settings and you got a flood of excuses. But offer those same marketers a chance to create an Elvis avatar and go online with half a dozen highly pixelated perverts who come from countries where your brand is not sold and who keep interrupting your ‘interview’ with proposals of cybersex and marketers lined up around the block. Second Life as the future of consumer insight. Remember?

What makes marketers’ obsession with spangly new shit so annoying is that our discipline does the basics so badly. We can be so easily diverted into incredibly pointless new stuff with the flick of a glittery switch while failing to follow even the most basic tenets of marketing competence. The general quality of the marketing plans I see from big brands is terrible. No qualitative research driving a good quant survey.

No segmentation of any kind and certainly no explicit targeting. No buying path. No smart objectives. No IMC. No bottom up budget. The basics of marketing are usually missing. But my only hope to get marketers interested in doing their job properly is calling the standard approach to marketing strategy a ‘thwackometer 4000’ and presenting it exclusively to marketers via a virtual reality app made on a 3D printer that was originally promoted on Vine.

The title of the article in The Marketer gave it all away last week. It was called ‘The battle of the realities: which one will prevail for marketing?’ Readers were meant to opt for augmented or virtual reality by the end of the piece. How about another alternative? How about Actual Reality instead?

In the first camp are the steadfast ignorers led by the likes of Patek Philippe and Breguet. These brands, very much in the conservative corner of the luxury watch industry, see smartwatches as fundamentally different from what they offer. When you sell heritage and the pinnacle of luxury at around £30,000 a pop it’s easy to see why these brands are unconcerned with Apple and its ilk arriving into the market. Marc Hayek, who heads Breguet, Jaquet Droz and Blancpain, typified this conservative approach: “The Apple Watch is not a real watch but a consumer electronic,” he told Reuters.

Troublemaker – The Apple Watch

A second group of watch brands were similarly unconcerned about smartwatches but were convinced that the new entrants would eventually spur younger consumers to trade up to a ‘proper’ luxury timepiece. “When it comes to a higher end watch I strongly believe in mechanical movements – the beauty is that they last for generations and you don’t have to worry about batteries and recharging,” Chopard co-president Karl-Friedrich Scheufele explained. He said that this new breed of smartwatch could “feed a chain of aspiration” that would lead to more watch sales for brands like Chopard in the future. That’s an important opportunity for luxury watchmakers that openly acknowledge you no longer need a wrist watch to tell the time given the preponderance of other digital devices in most people’s possession.

Intel, Google and Tag Heuer Join Forces

Finally, a third group of watchmakers are experimenting with smart features to create hybrid watches. Tag Heuer announced that it is partnering with Intel and Google to launch a smartwatch later this year. For Tag Heuer, which has traditionally occupied a lower price point than many of its more exclusive rivals and is positioned as a technological pioneer, the partnership makes strategic and branding sense. It’s a similar story for Google, which was recently burned by the failure of Google Glass and is looking for partners with core competencies in design and aesthetics to bolster its own apparent deficits in these areas. Breitling is also dipping its toe in the digital pool with the launch of B55 Connected, a Swiss-made watch that offers Swiss-made apps and connectivity. The networked functionality of the new watch is limited but, as Breitling soberly observed, “the watch remains the master”.

The Watch Remains the Master – The Breitling B55

Underpinning this entire debate is a strong sense of strategic déjà vu. Twice before the Swiss watch industry has been plunged into recession and revolution by new competitive developments. The ‘first technological crisis’ occurred in 1876 when the Swiss discovered to their horror that American engineers were now able to replicate and improve on their mechanical movements. The second crisis, often referred to as the ‘Quartz Revolution’, occurred a century later when cheaper, battery powered watches emerged with superior accuracy to an automatic movement at a fraction of the cost.

In both prior instances the arrogance and insularity of the Swiss watch industry cost them dearly and their dominance was restored only when it adopted the competitive threat into lower end offerings (the development of the Swatch quartz offerings for example) and refocused its efforts on super-premium watches and traditional savoir faire.

Expect nothing different from this third ‘crisis’. Lower end watchmakers like Seiko are in for a genuinely rough ride as smartwatches evolve their functional offerings in the sub-£250 market. But we will need to wait a generation to discover if today’s tech-teens will keep their smartwatches and eschew luxury alternatives as their earnings and waistlines expand.

Personally, I doubt it. When you spend four figures on something that your tablet or phone does for free, you are making a genuine luxury purchase. Customers in this segment are seeking distinction, design and an enduring thread of authenticity back to the original Swiss brands of old. That’s why a great watch will increase in in value as the years progress rather than lose almost all of its worth the moment it is purchased.

Buying a watch that goes up in value? As many of the attendees at Baselworld joked last week, that’s the smartest watch of all.

Wilson was quizzed about Lululemon’s recent quality issues with its best-selling yoga pants. Wilson admitted to design flaws but also pointed to a consumer issue too: “Quite frankly, some women’s bodies just don’t work for [our product],” he explained. “It’s about the rubbing through the thighs,” and “how much pressure is there.”

Despite backtracking later in the interview and suggesting the brand could be worn by all women, the comments caused an immediate sensation. “Lululemon founder Chip Wilson blames women’s bodies for yoga pant problems”, claimed Good Morning America’s website the next day. “Lululemon founder blames yoga pant problems on customers’ thighs”, announced Yahoo.com. Wilson was branded “clueless”, “sexist” and a “body fascist” on Twitter.

To make matters worse Lululemon was already in hot water for making its yoga pants only up to an American size 12 (UK size 16), thereby actively excluding most American women, whose average dress size is 14 (UK size 18). The brand has made no secret of its policy, claiming that “larger sizes are not part of its formula”. Even its size 10 and 12 pants are often relegated to the back of the store.

The approach has garnered plenty of criticism. In 2012, a national petition was launched to pressure the company into offering plus-size options. “Wouldn’t it be amazing if Lululemon took an active stand in showing women of all sizes being athletic?” the petition stated, calling for the company’s support for “fitness at any size”.

Thus far, Lululemon has ignored the appeal and, from a marketing perspective, you can see why. Brands cannot be for everyone. One of the most established principles of our discipline is that mass-marketing does not work, while targeting a specific segment of the market exclusively usually does. If you want a perfect example of that principle just look at M&S and its clothing line. The reason for nine consecutive quarters of decline is entirely related to a marketing department intent on appealing to every adult woman in the UK. Their latest Christmas campaign is, for the first time, far more targeted.

Is Lululemon really guilty of anything other than having a clear target segment and designing for that specific group? Is it any different from a brand like Marketing Week that aims at marketing professionals and eschews a broader professional readership?

It’s tricky because, of course, the answer depends on how you segment your market. Do it by profession, postcode or income and you still fall within the bounds of political correctness. Use body size, age or physical attractiveness and you cross over into very choppy waters, especially in America.

That’s not to say we aren’t increasingly sensitive to clear targeting in this country too. In the cavalcade of criticism of Guinness’s ill-fated RoundUpYourMates campaign last month, most reviews cited piss-poor execution or ridiculous strategic thinking. But a significant number also cited the exclusive male focus of the campaign as sexist and inappropriate. Is that really fair on Diageo when more than 90 per cent of the brand’s sales in the UK are from men?

Do marketers really have a responsibility to cater to each and every possible customer? Should founders of brands like Lululemon eschew targeting and open up their offer to everyone even if, paradoxically, it results in diminished sales? It might make sense politically but from a strategic standpoint the results of clear target marketing remain inarguable.

Like it or not, the only crime Chip Wilson committed last week was the sin of honesty. The lesson for marketers is that while we must continue to segment appropriately and target exclusively, we must do so while keeping our lips closed. In public, infer that everyone is potentially welcome to patronise your brand. In private, ensure clear positioning and consistent execution of the four Ps will delight the consumers you want and exclude the ones you don’t.

I’ll leave you to decide who is who.

If you have been following recent events in Marketing Week it should have become clear that one of these supermarkets has a winning strategy and one, very clearly, does not.

Before we get into winners and losers, however, let us define the game. Too often in marketing we are unclear on what we actually mean by strategy in the first place. My favourite video on YouTube at the moment is a short three minute presentation from Harvard Business School featuring Roger Martin. The now retired Dean of the Rotman School of Management in Canada, and one of the great gurus of modern strategic thinking, lays out in a characteristically Canadian manner a very simple and straightforward explanation of what strategy is and how you create a good one.

“Given the array of intimidating and often confusing strategy tools out there, it can be hard to even know how to start,” he explains. “So here’s how. Think of strategy as the intersection of two critical dimensions: where you will play and how you will win there.”

It really is that simple according to Martin. You make explicit choices on where you will compete and then make sure your differentiated tactics enable you to win there. Attacking the same market as your competitors with the same strategy is, as he points out, a recipe for a financial “blood bath”.

Now, consider the strategic wisdom of Tesco’s recent announcement that they will launch “pound zones” in up to 300 of its stores. The zones, which will offer non-food bargain items such as beauty products and pet toys, are directly designed to counter the threat of the growing success of bargain retailers like Poundland and Poundworld.

The two key questions that Tesco has to answer are the strategic ones posed by Roger Martin. First, does Tesco really want to compete with the likes of Poundworld and German retailers like Aldi and Lidl? Ideally, of course, you would want to avoid this battle but Tesco’s market share of almost 30% of UK groceries combined with the growth of these discount operators means it’s almost impossible for Tesco to ignore the threat. They have to go toe to toe.

But where Tesco are coming strategically unstuck is the second question of how to win. Clearly replicating the prices and promotions and look and feel of the bargain retailers is a mistake. First because you cannot beat your competitors at a game they invented. Second, because as you attempt the impossible you switch off the majority of your shoppers who aren’t interested in Poundland and who came to Tesco because, well, they wanted Tesco.

Contrast this muddled strategy with the triumphant approach of Waitrose if you are still unclear on how to “do” strategy properly. At a recent visit to a new store in Swindon Waitrose’s Chairman, Mark Price, provided a sneak peak into how Waitrose are combatting the discount threat. Highlighting the retailer’s recent innovations such as wine tasting areas, free coffee and their extended product range Price declared; “We’re going to be everything that the discounters aren’t.”

And Price went further, noting that his major concern was not only the discount retailers but also how Waitrose took the battle to its more traditional rivals. “It is more about how we respond to Sainsbury’s and Tesco in terms of what they do with pricing,” he explained during the store visit.

It’s clear that Waitrose is winning the strategic retail war and is set for a period of unprecedented success. First because it has identified a truly different way to complete and second, because traditional rivals like Tesco are losing their own focus as they attempt to combat the threat from below.

In a recent Which? survey of 7,000 shoppers Aldi and Waitrose finished bareley a percentage point apart at the top of the table for ‘most satisfying’ supermarket chain. That might seem a curious result given just how different these two retailers are. But that’s the point. The one thing the two do have in common is strategic differentiation. Both know where they want to play, and how they are going to win.

Let me review both options for you because, as we enter June, those of you who do it smartly and work to a January-to-December planning year are literally starting the process as we speak. If you set budgets the stupid way, you have nothing to worry about for another four months.

Stupid marketers let the finance department set their budget. They arse about with tactical stuff until mid-September, when they are issued with the expectations for 2015.

So, for example, the finance team might instruct the marketing department that next year they are expected to grow top-line revenues by 7 per cent and achieve sales of £75m. They are also told that their marketing budget for the year ahead will be £3m based on the 4 per cent advertising-to-sales ratios that the company uses to derive marketing budgets.

It can look deceptively logical until you look at where these numbers come from. As one of my favourite clients likes to put it – they all derive from the SOOMA Database – SOOMA standing for Straight Out Of My Arse.

The 7 per cent growth rate isn’t based on strategy or research. It comes from arbitrary growth expectations that your board or global team have applied to your business, irrespective of the fact that they have seen no data and probably not even visited your market in years.

The 4 per cent ratio of revenue to marketing spend is doubly stupid. First, because it is another completely arbitrary number (why not 10 per cent, or 2 per cent?) that senior managers deem acceptable. Second, because this ratio is applied after the £75m revenue expectation has already been set, it is clearly derived from a belief that marketing is not an investment that can increase revenues but rather a cost that we must pay each year, irrespective of sales.

The serious point about all this is that when a company sets a budget for 2015 this way, all strategy dies. Any serious marketer will realise that if the numbers and the investment levels are already in place long before they have even looked at research or strategy for the year ahead, he or she is literally pointless. The joke is on any and every marketer that accepts these bullshit budgets and works within their parameters for a whole year of their life.

It does not have to be this way. The smart way to build a marketing budget does not start top-down with the senior finance team but rather begins bottom-up with the marketing department.

The financial plan for a calendar year will always be set between September and October, so it’s crucial that marketers don’t wait for a moronic number but rather start working on their proposed 2015 strategy now.

That might sound early, because it is. But if you don’t get the strategy in before the budgets are set in September, you will be lost in stupid-land like everybody else.

A smart marketer collects research in June and July. They build and populate their segmentation. They decide on their targets for 2015 and then, crucially, decide on their objectives for each segment. Here you will note that I am not talking about the flaccid, open-ended objectives that populate most firms. You know the type – “Improve brand sentiment among young adults”. I am talking about SMART objectives you can hang your hat on and pay bonuses on – “Increase brand preference among the ‘Out to Lunch’ segment from 29 per cent to 65 per cent by 1 December 2015”.

Once you set a real objective, you can work out what it’s worth. Annualise the figure for 2015 and go and brief your agencies. Share the objectives with them and ask them to come back with tactics and associated costs. Put all that together and you have a bottom-up, strategic budget to propose to top management. You can propose how much money you need and how much money you can generate in the year ahead.

Or you can sit on your arse monitoring how many followers you have on Twitter for another four months until some idiot from finance looks at a line chart for 10 minutes and tells you what to achieve.

Tesco’s half-year profits have dropped from more than £1bn to just over £100m. Sainsbury’s lost nearly £300m over the same period. Morrisons and Asda have fared less badly but both saw sales decline in their latest quarterly results. It does not take a marketing genius to work out why the big boys are losing money. The German retailers Aldi and Lidl are growing at a rapid rate with 12-week revenues up by 26% and 17% respectively, according to Kantar Worldpanel, and that growth is rocking the big four’s boats.

Mark Price, the managing director of upmarket supermarket chain Waitrose, believes the impact of German discounters on the high street is creating an “inflection point” of enormous importance for British consumers. “This is as fundamental as supermarkets coming into the UK in the 1950s and reinventing what food shopping was all about,” he recently told The Daily Telegraph.

We also don’t need any heavy analysis to work out how all of this came about. As the big four supermarkets started to run out of market share gains they used price increases to maintain their profit growth. That kept the stock market happy but over the last five years it also created a bubble in which the German discounters could grow and establish themselves as genuine alternatives. According to Goldman Sachs Rob Joyce, too much focus on profitability allowed the “discounters to get too strong”.

Now the twenty billion dollar question is what will the big four do about it?

We certainly know what they are currently trying to do which is to fight fire with (a smaller) fire. All the major supermarkets are engaged in massive discounting and sales promotions as they tussle with each other to maintain share against their traditional, suddenly desperate rivals and the growing threat from their new German competition. There is much talk in the industry of “war”, “battles” and “fatalities” and that’s more than the usual macho retail bullshit. Next year promises to be a bloodbath on the grocery aisles – the like of which modern marketers have never seen before.

What makes the imminent discount battles particularly interesting is that they won’t work. You can’t beat Aldi at low prices and to even attempt such a mission will result in billions lost and, ultimately, nothing won. “We believe that any major price investments by Morrisons, Sainsbury’s or Tesco can be exceeded by the discounters,” Goldman Sachs concluded in a new report published this week. It’s a classic strategic error – you try to beat your competitor on a core competence that you simply cannot match them on.

Aldi will tell you the same thing. Matthew Barnes, its joint UK managing director, recently admitted that the big four’s price war had benefited his business. “With all the clamour around reducing the gap on Aldi, the psyche of the British consumer has been to examine what value means,” he told Retail Week. “And that’s just played perfectly into our hands. The acceleration of our growth since the price war has begun is testament to the fact we are more than ever resonating with customers.”

So what can the big four do? The answer is to “grow small”. They will need to close a significant proportion of their stores in the next two years in order to survive. Closing stores enables them to get rid of their weakest and least profitable locations which will eventually improve margins. More importantly it will allow the big supermarket chains the chance to re-focus and rebuild their offer around a meaningful differentiation that somehow competes with Aldi and Lidl.

Shutting stores also has one other advantage – it enables the big four to catch up with the German rivals in terms of store design. The “inflection point” Mark Price speaks of is not one of low prices, it’s also caused by smaller stores. The average Tesco has 25,000 products on its shelves while the average Aldi has fewer than 1,500. British shoppers aren’t just putting up with less choice for better prices, they prefer it. The giant floor-plans and enormous ranges that made the big four so successful in the Noughties are now a potential causal factor in their downfall.

Expect 2015 to be vicious. Expect it to be price-based. Expect one of the big four to start to fail. And expect Aldi and Lidl to emerge triumphant.

Last week, we got one answer to the question. It appears that many of them get into private jets and head to an Alpine mountain to prance about in snow shoes. I am referring, of course, to that corporate circle-jerk (look it up if you dare) more commonly known as Davos.

The World Economic Forum at Davos is a peculiarly pointless annual event in which political titans, religious gurus and corporate leaders meet and feel important while feeling the world’s pain. I can just about understand why priests and politicians are drawn to the event, but why do CEOs and CMOs of FTSE 500 firms go there? Call me naïve, but I always assumed that successful capitalists and diligent marketers had better things to do with their time.

Jakob Riis, the much celebrated vice-president of marketing at pharmaceutical giant Novo Nordisk, has a busy 2015 with a series of high-profile launches including Xultophy and Saxenda, so how can he have time to attend Davos? I can appreciate the visceral thrill of being in the same elevator as Andrea Bocelli but surely multi-billion euro launch plans should have kept him at HQ this year? And if I was Anne Finucane, global chief strategy and marketing officer at Bank of America, I might have reviewed the appalling financial performance of my company in 2014 and the piss-poor ratings of my bank’s service scores versus most of my competitors and decided that perhaps Davos was not the top priority.

But, when there’s a chance to share apéritifs with Bill Clinton and discuss interest rates with Paloma Faith, what’s a marketer to do?

It’s not just the guest list that beggars belief. This year’s event identified 10 ‘global challenges’ for discussion. Despite the worthy intent behind the list, it was undermined, at every turn, by the event itself. So while attendees debated ‘environment and resource scarcity’, most of them presumably forgot that they had arrived in one of the 1,700 fuel-hungry private jets that brought Swiss airspace to a standstill last week. The discussion of ‘gender equality’ was surely undermined by the fact that 80% of attendees were male.

Ironies and oxymorons abounded. Executives sporting six-figure time pieces railed against economic inequality. Representatives from the very banks that brought the world economy to its knees with their short-term stupidity earnestly debated the value of long-term investment strategies. Rarely has corporate hypocrisy been so blatantly on display.

One might expect the world’s media to point some of this out. Alas, the majority of journalists were victim to a collective case of dissonance reduction because they (or their bosses) also attended Davos. In a master stroke of organisational propaganda, its organisers nullified the criticism from media channels by inviting them too.

Pop stars, gurus, CMOs and journalists. The only thing missing from Davos is, of course, any coherent list of actual achievements. Despite 40 years and hundreds of millions of dollars in wasted executive hours, the output of the World Economic Forum remains entirely underwhelming and unconvincing.

One might therefore conclude that Davos is an inappropriate event. Nothing could be further from the truth. In this over-paid, under-performing, uber-ego world of modern leadership, nothing better captures the current state of post global financial crisis capitalism than the World Economic Forum. In an era when our leaders set examples for others and not themselves and firms openly flout the regulations and values that they are meant to uphold, Davos is the perfect encapsulation of our times. The ultimate international ‘fuck you’ to the 99% signed, with a flourish and a group photograph, by the 1%.

I’d like to propose a new metric for great CMOs and other senior executives who might have been invited to attend but managed to evade the giant Swiss twat magnet that is Davos and got on with their jobs instead. That’s my kind of leader.

Advertising Age published a fantastically unhelpful article last week. In it, the chief marketing officer at Publishers Clearing House, Jason John, recounts his recent purchase of a coffee maker.

John first describes realising that the weird noises and less-than-perfect coffee emanating from his coffee maker mean he might need a replacement. Next, he searches online for ‘best coffee makers’ and, as a result, on the way home that evening is greeted by targeted mobile ads for coffee makers during his commute. That weekend he heads into store to check out the options in person but is deluged with online coupons sent to his phone offering various deals. He decides on a brand and opts to order the machine online for a better price. That evening, once home, he places his order on his laptop.

After recounting this story John goes on to conclude: “People say the sales funnel is changing – that, in today’s digital world, the way customers buy is no longer a simple path from awareness to prospect to sale. That’s just not true. The sales funnel isn’t changing – it’s completely and utterly dead. It’s been brutally turned upside down, inside out, with little left to identify it as the clean, straightforward process it once was. Today’s shopper jumps in and out of channels, views alternatives to purchases, and searches for better deals – all at the tap of a screen, the click of a button, and oftentimes while standing right in front of the item she’s trying to buy.”

The sales funnel has been a cornerstone of marketing strategy for over a century. It was invented by E St Elmo Lewis in 1898 and is widely regarded as the first formal theory of marketing. It evolved throughout the 20th century, becoming better known as the ‘hierarchy of effect’, the basis for the Dagmar (defining advertising goals for measured advertising results) models of advertising planning and as a major structuring tool for large consulting firms. It’s rare to encounter a major McKinsey engagement that does not, somewhere near its heart, contain a purchase funnel of one sort or another.

Very simply, the sales funnel represents the yellow brick road of marketing. Having identified a target segment, the funnel charts the various steps in the buying journey and then populates the steps with the proportion of that segment at each stage in the process. With this analysis complete a marketer can use the funnel to decide where to focus their efforts, what the brand objectives should be, what tactical tools to invest in and what investment and return are expected. I am on about my 300th sales funnel, having built them for the last 15 years for a variety of clients. Each funnel is different depending on the product and, crucially, the segment being targeted.

I have grown used to, on an almost daily basis, encountering marketers and consultants claiming that the whole world of marketing has been changed by the new digital era. But it’s rare for an article disclaiming a particular part of marketing theory to actually disprove its own thesis in its opening paragraph.

Re-reading Mr John’s coffeemaker odyssey it is quite clear that his purchase is structured by a very simple set of steps. First came his awareness that he had the need for a new product. Next came the information search stage. After this, he formulated his preference based on product, price and some promotional offers. At the end of the preference stage he went home and made the purchase. The only step missing is his post-purchase reactions to his new machine which, alas, he does not include in his account.

The error that Mr John makes is looking at the tactical resources that he uses to traverse the various steps in the buying process, rather than the journey itself. Clearly today’s consumer is availed with a whole set of resources and influences unimaginable a decade ago. But that is not the point of the sales funnel, which charts the consumer journey, not the tactical attempts of brands to influence it.

Can I again remind the reader of the difference between strategy, in this case working out what the stages are and which one to focus on in order to increase sales, and tactics, the various actions I will invest in to execute the strategy. One of the great problems of the new marketing world we live in is that all these dreary marketers who feel it necessary to prefix their job titles with the D-word simply do not understand the difference between strategy and tactics.

The sales funnel precedes the invention of television, direct mail, telemarketing, cinema ads, the internet and smartphones. Each and every one of these technologies has changed the tactical options available to marketers, but the essential challenge of marketing strategy and the enduring value of a properly derived sales funnel remain undimmed.

Enjoy your coffee.

Bruce McColl, the Global CMO for Mars, was in no mood for prevarication last month at the Advertising Research Foundation’s annual ReThink conference in New York City. “I’m not a great believer in targeting,” he explained to the audience. “Our target is about seven billion people sitting on this planet”. He went on to define the challenge for Mars in equally unequivocal terms: “Our task is to reach as many people as we can; to get them to notice us and remember us; to nudge them; and, hopefully, get them to buy us once more this year.”

At first sight you might assume that McColl is lacking marketing expertise. After all marketing theory for the last half century has demonised mass marketing as the antithesis of marketing excellence. Millions of marketers have been indoctrinated into the ‘holy trinity’ of marketing strategy in which a market is first segmented, then a specific target segment is selected and finally the brand is positioned accordingly. How could McColl get it so wrong?

The answer is not so simple. McColl is a fine, very experienced marketer with an impressive track record. He is also not alone in his new found love for mass-marketing. Barely a month passes these days without a senior marketer from one big brand or another stepping up to decry the fallacy of targeting and favouring a mass approach instead. Targeting is in danger of becoming an outdated marketing concept.

Most of the blame/credit for this sea change can be traced back to the Ehrenberg Bass Institute and the remarkable success of Byron Sharp’s book, How Brands Grow. Sharp’s book is as radical as it is influential. Sharp has successfully reframed a wide range of marketing concepts with a potent mix of data, case study and a thinly disguised distaste for fluff.

I recommend the book but, of all the many claims contained within it, the broad rejection of targeting troubles me most. Certainly there is a strong case to be made for companies like Mars broadening their scope and aiming for mass household penetration. Indeed, many of our biggest consumer goods companies including Coca-Cola, Unilever and others are now following the Ehrenberg-Bass system and have reversed decades of STP – segmentation, targeting and positioning – and returned to a mass-marketing approach.

As much as this might make sense for some, I would caution marketers to consider the move carefully before jumping onto the anti-targeting band wagon. There are still many instances where a clearly identified target segment will make you more money than a mass marketing approach.

Smaller companies, for example, without the resources or scale of a Mars would do well to start by taking a smaller, segmented bite of the marketing apple and gradually building their presence. That’s especially compelling if the big boys you are up against are now all engaged in an Ehrenbergian attempt at mass marketing.

In markets where dynamics exist between segments, the case for targeting also remains strong. I worked last week for an American fashion brand that had aged with its client base and had suddenly discovered it’s once twenty-something customer was now forty-something. Nothing wrong with that customer or her sales, but without an explicit re-focus on a new generation of younger clients the brand in question was looking at a long, slow death.

Similarly, in the much less discussed world of B2B marketing, where the sales force forms an inextricable resource constraint, it would be suicide to try and apply such a mass marketing approach. While Ehrenberg-Bass is correct to challenge the applicability of Pareto’s principle that 80% of sales derive from 20% of the customers in categories like dog food and confectionery, I can assure them that the old Italian’s theorem applies beautifully in B2B settings. These consumer asymmetries combined with a tiny sales force impel an organisation to target tightly.

Clearly Mars think they have a sound strategy and who am I to suggest otherwise? But if targeting becomes a dirty word across the whole of our discipline we risk a return to the marketing dark ages. It is impossible to teach targeting to MBA students these days without extensive reference to Ehrenberg-Bass and its theories, but I still teach targeting as an explicit strategic choice. Do we target everyone like Mars? Do we target a couple of segments? Or do we make the leap of faith that says because of our size or the market’s dynamics we will only go after one segment?

Seen this way, targeting remains an essential strategic question for all marketers. But it becomes a question of who rather than if. I would argue Bruce McColl is mistaken to claim he is not a big believer in targeting. I think he has decided – in this instance – to target everyone.

There is no easy way to start this week’s column without sounding like a wanker, but I am genuinely worried about the state of our discipline. We’ve never been regarded as the most strategic part of the organisation but in the last few years marketing seems to be devolving into a base tactical pursuit devoid of strategic thinking.

To understand my point, you have to realise the distinction between strategy and tactics. Marketing strategy is where we play and how we win in the market. Tactics are how we then deliver on the strategy and execute for success. In traditional military strategy, the generals of old would gather, survey the battlefield in depth, review the enemy’s forces and then decide exactly where to attack, at what time and with which forces. Strategy agreed, the orders would be sent down to the various battalions who then concerned themselves with the tactical business of executing their respective objectives. A troop charged with taking a hill, for example, might deploy its archers and then send in the infantry to finish off the enemy.

In the traditional world of marketing we follow a similar systematic process. First we build a map of the market from research in the form of a decent segmentation. From there we can decide which segments to go after and how to position our brand for optimum success. Finally we devise clear strategic objectives for each target segment specifying the goal we will achieve. Only then – with clarity on who, what and when – do we start to think about tactical execution and which specific tools we might apply.

But that last paragraph now describes an approach in apparent decay. The last decade has seen marketing deluged with a sea of new tools and techniques. The concept of real-time rather than long-term planning has added fuel to the fire. Finally, a new breed of marketer who prefaces their title with the tactical term ‘digital’ has inundated our discipline with under-trained, overly tactical managers who have already selected their mode of execution long before any research or strategy has been even countenanced. They already have their crossbow drawn with no clue where, who or what they are attacking.

Over on the other side of town, Marketing magazine – the long standing rival of Marketing Week – has just been retired and subsumed into a tactical title called Campaign. The editorial team behind the move talk about “creativity”, a “new breed” and “breaking down silos”. But if the exit plan is to move from silos to a giant tactical ghetto where does that leave our discipline?

There used to be a section in every marketing and retail magazine that featured hundreds of promotional gifts and freebies. Golf balls, frisbees and branded pens – you know the kind of thing. There is a very real danger that Campaign and then the rest of British marketing goes this way over the next few years. All this talk of social media platforms, virtual reality and 3D fucking printing is missing the point – the strategic point – of marketing. Our discipline must be founded on understanding consumers and then coming up with the strategy that helps our organisation win in the market. All the tactical mish-mash and creative hoo-haa that follows is an important part of the marketing plan, but it’s not the starting point and it’s certainly not the most important bit.

A general manager at a client I advise recently asked me to chat with a marketing manager about his 2016-17 marketing plan. The GM was worried it was all “bells and whistles”. Sure enough when we went through the plan there was a surfeit of digital tactics for the year ahead but when I asked him about his targeting, positioning and objectives the look on his face astonished me. It wasn’t that he was unsure of his answer, it was his abject confusion that such questions were even appropriate any more. I used to battle against the executives from finance and accounting who sneeringly referred to marketing as the “colouring-in department”.  As time goes on I fear they might have a point.

As the greatest strategist of them all, Sun Tzu, observed more than two millennia ago: “Tactics without strategy is the noise before defeat.” I hope so. Because we need an urgent re-centering of marketing back towards strategic fundamentals before it’s too late.

If you disagree with me get over to Campaign and sign up for their shiny new publication – the website’s front-page stories this week are on millennials, Snapchat, billboard hijacking and digital dating. For anyone else, I recommend climbing back up the disciplinary ladder to a higher place. It’s called marketing. We cover it weekly.​

By now you almost certainly know what is at stake. If British voters opt to stay in the European Union next Thursday we lose the last vestiges of sovereignty, immigration will run amok and rule of law will permanently cease to be a matter for British courts. If we vote for Brexit our economy will most certainly crash, we will become a political and economic pariah state and, if European Council President Donald Tusk is to be believed, we will usher in the end of Western political civilisation as we know it.

Clearly, it’s rhetorical nonsense on both sides. The debates have become childish slanging matches in which both sides throw bullshit in ever increasing volumes at the other. I have no idea which way I will vote and even if I did, I certainly would not be advising you what to do. This is Marketing Week after all, not The Spectator.

But I can use my marketing skills to tell you who is more likely to win the vote next week. The current poll of polls has the difference between the leave and stay votes within the margin of error. But if you look more closely at the central arguments of both sides, it’s clear which one will gain the greater popular support and win the day.

To work it out you have to remember your basic marketing training, and specifically the concept of positioning and the benefit ladder. The idea of the benefit ladder is deceptively simple. You start with whatever product feature you believe your product offers that is superior or different from the competition – a micro-camera fitted to a toaster that can identify colours, for example. You then look for the benefit to the target segment that this feature will deliver – perfectly toasted bread every time. Finally, if possible, you push towards the heavens and look for the emotional benefit that this this product benefit will confer – you are the perfect parent because you make perfect toast every time. The higher up the benefit ladder you can authentically base your positioning claim the more powerful and successful it is likely to be.

If we look at the Remain camp it’s obvious what the product feature is – the continuation of the UK’s membership in the European Union. The benefit of staying in Europe is to avoid the fiscal penalties that Brexit would incur. Specifically, the pound will weaken and our economy will worsen. Emotionally that translates into tougher times ahead for families who will face more expensive holidays, less job security and, if George Osborne is to be believed, “£4,300 less money per household by 2030”.

The Remain Argument:

Contrast that with the Brexit argument. Their product feature is to exit the European Union. The benefit of such a move is to return to British sovereignty and the ability to properly control immigration. The emotional benefit of Brexit is to prevent the UK being over-run by a growing tide of foreigners who will weaken the national spirit and use up its precious resources to our detriment.

The Leave Argument:

So which of these two arguments is most important to the British public? Last week’s poll from YouGov has the economy three points above that of immigration. But, there is a big difference between rational box ticking and the emotional implications of these issues when they come close to home. While no one wants to be worse off, the dreaded spectre of continued immigration and all the manifest threats to both economic and cultural life that it portends makes it a far more emotive and therefore persuasive argument. That’s why the most recent polls show that only 66% of Remain believers are definite that they will actually vote next week in contrast with 78% of Leave supporters. That’s a crucial gap when the polls are so tight.

With still so many voters undecided, clearly the vote could go either way. And much depends on how both sides handle the final week of campaigning. But the more the Leave campaign openly and repeatedly pushes a reduction in immigration while the Remain side continues to promote the economic advantages of staying inside the European Union, the more sentiment will swing towards Brexit.

It’s a fascinating case study because the product features of both sides are equally attractive. Half the British population want to remain in the EU and half wish to leave. The population are equally split on whether the economy or immigration is the bigger issue. But this whole decision, arguably the most important one in recent British history, will come down to the benefit ladder and who can play the emotional advantages better than the other. My money, if not my heart, sides with Brexit.

We’ve teamed up with award-winning columnist and Professor Mark Ritson to bring you a new online learning experience. The MW Mini MBA in Marketing is a CPD accredited, MBA standard course. Cover the same core modules as leading MBA programmes, in just 12 lessons, it will give you the tools you need to do your job better. For more information click here.

Sitting on a train on Friday grading exam papers I got a tweet from marketing consultant Glen Gilmore. The tweet was a little grid of 24 headshots and the message, “24 Marketers you Should Follow on Twitter”.

Intrigued, I clicked the link and discovered it was actually an article by Nicholas Scalice for Earnworthy.com in which he presented a list of his “24 top-notch marketers”. I scrolled through the list. Some of the faces were familiar to me and I smiled when Gilmore himself appeared. I was about to head back to my exams when I had a fantastically cynical thought. “I wonder,” I said out loud to the immediate concern of the woman sitting opposite me, “how many of them have actually studied marketing?”

24 Marketers You Should Follow on Twitter https://t.co/wBXbmdolnt via @nscalice #smm #cmo #SocialMediaMarketing pic.twitter.com/y5kfgeJe9m

— Glen Gilmore #SocBiz (@GlenGilmore) July 8, 2016

It’s a reasonable question is it not? If they are being held up as experts in the discipline of marketing – not just digital communications, you will note – you would certainly expect them to have a qualification in the topic. If someone sent me a list of the 24 leading experts in brain surgery or physiotherapy or 17th-century romantic fiction I would expect most, probably all, of the names on the list to have a formal education in the subject matter in question. Why not marketing?

Before I knew what I was doing I had Excel open on my laptop and LinkedIn windows were popping up all over the place. I went through the list of 24 experts and finally sat back with my research compete. Do you know how many have a formal training in marketing of any kind, according to their LinkedIn profiles?

Four of them.

In that whole list of 24 world-leading experts in marketing only four have a formal education in the subject. There was one MBA, two undergraduate degrees and a community college certificate.

Now that’s not to say those other 20 thought leaders aren’t intelligent people. They have degrees in all kinds of subject areas – electrical engineering, English literature, political science. It’s just that they don’t have any training in the thing they are meant to be telling you about. The author of the article, himself an expert in “inbound marketing tools” (bachelor’s degree in criminal justice, master’s in public administration), had managed to pick a list of people that are less well trained in marketing than the average local PR agency.

Now I know how this reads. Middle-aged marketing professor with a BSc and a PhD in marketing is pissed off because he did not make a list of global experts. Or worse, out-of-touch marketing academic wishes people would still listen to business school professors because he is one, and they don’t.

But look beyond that and I think there are two serious concerns. First, despite their billing as leading experts in marketing it’s clear from even a cursory examination of the list that these people are actually experts in just one area of marketing – communications. They sell it using a variety of different, new conceptual names like “traffic”, “content”, “lead conversion” and “digital marketing” but this is what ancient professors used to call the promotional part of the marketing mix. Nothing wrong with that but this is a very small part of marketing discipline – about 10% by my estimation.

The new breed of experts are big on tactics but light on market orientation, research, segmentation, positioning, brand equity, strategy and all the other rich substantive matter that makes up the remaining 90% of marketing once you take the promotional P out. Our new generation of experts are actually confined to a very small tactical box, despite their billing as general marketing thought leaders and that makes for an overt tactical focus in those who follow them.

Second, the experts aren’t just out there teaching marketing to the masses, they are openly and explicitly altering it. It’s become the norm to suggest that “traditional” approaches don’t work and the new approach to content/purpose/inbound/digital/storytelling has disrupted everything. But I’m uncomfortable with people who don’t have a formal knowledge of the marketing discipline suggesting what needs to change before they actually understand in totality what it originally was.

I think before you become an expert/ninja/guru/visionary in marketing you should learn the discipline. I think before you start creating new rules and insights you should know what the existing ones are. I think before you explain how marketing is changing you should understand what it was before you started announcing the change. I think you need a qualification to be qualified. Surely you must agree?

Or shall I go get my coat and try my hand at becoming a world expert in origami, tree surgery or some other alien pursuit I haven’t got the faintest fucking clue about, and leave marketing to the ninjas?

We’ve teamed up with award-winning columnist and Professor Mark Ritson to bring you a new online learning experience. The MW Mini MBA in Marketing is a CPD accredited, MBA standard course. Cover the same core modules as leading MBA programmes, in just 12 lessons, it will give you the tools you need to do your job better. For more information click here.

I tried to resist as long as humanly possible. But the gravitational pull of Pokémon Go has pulled me into its digital tractor beam and forced me to join the throng of marketers enthralled by every facet of its augmented reality.

Like millions of other marketers, I now openly acknowledge that there have been two eras in the history of marketing – BPG and APG. All the old rules about having a strategy, doing research and thinking about stuff are clearly redundant because they were invented before Niantic and Nintendo managed to geo-locate small fictional creatures onto my smartphone.

READ MORE: Why Pokémon Go is a game changer for augmented reality and marketers

For starters, the language of marketing must change. Words such as storytelling, social, inbound, disruption, content and millennials clearly represent the vocabulary for marketing success. But it’s becoming clear that without the addition of Pokémon Go this lexicon is growing dangerously ‘traditional’ – and there is nothing worse than that.

Whereas in the past it might have been advisable for a marketer to tweet about ‘How to disrupt social storytelling and target millennials with your inbound digital content’, in the new APG era it’s imperative to upgrade this to ‘How to disrupt social storytelling with Pokémon Go when targeting millennials with your inbound content marketing’. It is a subtle shift, but essential if you want to prosper in the brave new APG era ahead.

Just in case you think I am taking the piss a little too much let me share some of my favourite implications of Pokémon Go from marketing experts/ninjas over the past week. Pokémon Go has been variously associated with the “beginning of a shift in the way we advertise”, “taking customer relationships to a level like we’ve never seen before”, and “solving one of marketing’s biggest conundrums”.

If you think the experts are embarrassing, how about the brands that have apparently tossed their marketing strategies out of the window in a fevered tactical chase to associate themselves with Pokémon Go and its crazed following. My favourite example last week was Mercedes. The German automotive manufacturer has invested in so-called ‘lure modules’ near ‘PokéStops’ to attract monsters and therefore people playing the game to their showrooms. Mercedes-Benz dealers across Germany have apparently been issued with a “detailed manual” to explain how Pokémon Go can be used to drive traffic to their showrooms.

I’m not sure whom Mercedes is meant to be targeting in Germany but I’m pretty sure it’s not sleep deprived pre-pubescent boys staring inanely into their smartphones. And even if that is their target customer I would be looking for a better time to try and sell them a car than when they are wandering, zombie-like, round the back of your dealership looking for Pikachu among the recycling bins. I’m also betting that if I challenged Mercedes’ current marketing department to tell me what their positioning is, they are more likely to tell me it’s “next to the big green Bulbasaur over there” than give me a proper, strategic answer.

Ever since the world was young we have had sudden fads that create a global sensation. The hula hoop, Rubik’s Cube, Cabbage Patch Kids, Tamagotchi – pick your fad based on your birth year. What makes the current Pokémon Go phenomenon so different is the way it has exploded out of the world of consumer fascination and into the world of marketing and business. We all went a bit mental about Cabbage Patch Kids back in the eighties but some bearded muppet from the Marketing Society did not turn up on the six o’clock news and start telling Angela Rippon how they were changing the face of modern advertising.

The real lesson marketers can learn from Pokémon Go has nothing to do with the game, and everything to do with the wobbly, ephemeral state of marketing these days. We blindly accept that there are 400 million players of Pokémon Go without checking for two seconds and concluding that this number is clearly nonsensical. We glibly assume that Nintendo will make “$12bn” from the new game before anyone realises that, as they did not actually create the game, they will make only a fraction of that sum from it. We watch brands confuse attracting any customer with a pulse and a smartphone with proper targeting in which strategy drives tactics.

Perhaps worst of all, we assume that today’s Pokémon Go player will be playing tomorrow. If we have learned anything from the fads of the past it is that Lucy grows tired of her hoop and Paul pulls the stickers off his Rubik’s Cube and starts using it as a football. Fads burn bright and then fade fast – how about that as the big lesson for marketers to learn from Pokémon Go? Or is my content too disruptive for you?

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A lovely long lunch with a couple of advertising people remains one of the great unadulterated pleasures in life. Like cigarettes at midnight or urinating on your lawn, it is a lovely combination of illicit fun and the magic of bygone days.

So it was last week as I launched into a third cocktail and my two lunch companions bemoaned the state of modern marketing. “Yes, I do feel your pain,” I nodded as I cancelled the rest of my meetings with a drunken swipe across my iPhone. “It must be awful.”

The conversation we were rather blurrily having is one I, and perhaps you, have had before. Most good advertising people these days are obsessed with the fact that they give most of their best work away for free.

The great strength of a good advertising agency has always been the synergy of an amazing planning team who can work out what you need to say to customers and then an amazing creative team able to articulate it in 30 seconds or less. None of that made money for the agency of course. Like most marketing people, they gave away the valuable service for free and made their margins on the superficial stuff. It was when the ads were made and commissions were charged that agencies could finally see some coin.

READ MORE: Why agencies’ reluctance to talk about rebates is making marketers nervous

But times have changed. The need for great planning and creativity is as big as ever in client land, but the days of charging millions for the execution of the campaign are now long gone. Freelancers, client procurement and pesky modern technology all mean that agencies cannot make their money as they once did.

It is a similar story over at media agencies. Once upon a time they laughed at creative agencies because their model was so much more profitable. Buying media on behalf of clients meant you could make money on the commission you charged them, the tasty surcommission you received from the media owners you bought from and – if you sat on the client’s media budget for 30 days before paying out – a nice little earner in an escrow somewhere to boot.

Media agencies similarly gave away their most valuable skill – namely, media expertise and planning – and made all their money on the relatively inane task of buying it. But once again life has changed in recent years. Client procurement has squeezed those commissions and ensured no more 30-day holding periods. The recent attention on surcommissions does not bode well either.

READ MORE: Marketers must take responsibility for media buying and fix the ‘disconnect’ with agencies

And it’s exactly the same tale at the big market research agencies. At one time they worked with clients to devise ever more intricate systems for understanding consumers and measuring brand equity. They did most of that work for free and then made the money from the mundane business of recruiting a sample and getting them to complete the survey.

But the growth of independent customer panels means that all the smart clients I know are designing their own questionnaires and going straight to the panel firms to execute the research. Questionnaires have got shorter, quicker and (if I’m honest) better now that clients are going direct.

Newspapers are in a similar bind. They used to make money by literally selling paper. The whole journalism, writing and opinion stuff might have been the difficult part but papers only made money from the relatively simple printing bit. As print circulations decline, the difficult challenge of getting people to still pay for the thoughts and opinions of journalists appears entirely beyond the capabilities of most mastheads.

And so as my long lunch progressed, my agency friends interrogated me about the manner in which I managed to make money from strategy. I sensed their despair when I told them most of my consulting money comes from training – like most marketers, I do the difficult bit of designing the content for free and then make my money on the execution.

In a final act of desperation, my lunch mates asked about several of the top-tier strategy consulting firms I had worked with. How did they make money from strategy? Again I had to disappoint. These firms might charge a little for boardroom time but, alas, they too make most of their money from junior associates billing thousands of hours executing the strategy in endless supply chain rationalisations and organisational reviews.

We concluded the lunch in disgraceful shape. The only sober thing in our taxi on the way home was the thought that the most difficult stuff seems to be given away for free only for the easy work to then bring in the cash. The problem for marketers is that despite the hard stuff never being in greater demand, the easy stuff no longer pays the rent. How many long lunches are left I wonder?

One of the biggest and strangest reversals in recent marketing history is taking place, unnoticed by most, in the supermarket aisles of the UK. In these fantastical days of Trump, Brexit and ad fraud, this statement might strike you as somewhat odd. But trust me, what’s going on with price promotions right now is worthy of your significant attention. Well at least a column’s worth.

For the past decade, British supermarkets have been engaged in a spectacular amount of promotional activity. The two great barometers of grocery buying, Nielsen’s Homescan and IRI’s Infoscan, disagree on the proportion of supermarket purchases that are made while the product is being offered on some form of promotional offer. Nielsen estimated that over the last 10 years the figure rose to around a third of all purchases while IRI had the number reaching around half of all supermarket sales. But both firms agree that this figure has risen consistently throughout the 21st century in the UK and that British consumers buy far more promotional items than any of their European cousins.

READ MORE: Consumers gear up for more price rises as inflation hits near three-year high

But, according to Nielsen, all that changed last month. In the four weeks ending 25 March only about a quarter of all spending at UK supermarkets was on products that offered a temporary price cut (for example, 20% off) or a multibuy deal (such as ‘buy one, get one free’). That might sound a lot but it’s back to levels we last saw in 2006. What is going on?

Well nobody actually knows. But there are three possible explanations to consider.

First, and I should point out from the outset that I don’t buy this one for an instant, maybe marketers have become a bit smarter. Sales promotions are a notoriously stupid thing to do and, even with your supermarket ‘partners’ squeezing your extremities so tight it’s hard to even scream, are something that should be resisted wherever possible.

The UK is a wobbly, worried place for consumers right now and that feeling will see us through until the end of this decade.

Yes, they shift a lot of stock and also help provide short-term differentiation for your brand over the competition. But that short-term sales bump comes with a much greater hangover as even the smallest cut in price causes financial disaster to bottom line profitability. Most marketers never get this point but when you cut your prices by 10%, while you might increase sales volumes by 20%, you probably reduce your net profit by around 40%.

Perhaps worse, the longer-term effects of forward buying while the brand is on special offer and the gradual commodifying impact of the promotion on brand equity lead to a subsequent dearth in demand that can only be resolved with… you guessed it…another sales promotion.

The influence of Aldi and Lidl

Maybe brand managers across the country have evolved bigger brains and stronger spines and pushed back against sales promotions – at least the price-based ones – in favour of smarter and less damaging promotional fare. A more likely explanation is that we are now seeing the ultimate results of the Einfluss (or influence, in English) from Aldi and Lidl’s growing success in the UK.

It’s perhaps no coincidence that on the same day we learned about the sudden downturn in promotional sales we also learned that the two German giants had taken another record share of UK grocery shopping. With Aldi enjoying 6.8% and Lidl 4.9%, according to Kantar Worldpanel data, both retailers are are achieving double-digit growth in the UK once again and are becoming ever more influential on the British high street.

That growing influence is crucial because the greater these two discount retailers penetrate a country the lower the proportion of promotional activity you are likely to see. That’s partly because the growing proportion of sales at Aldi and Lidl are drawn almost exclusively from their policy of everyday low pricing and not from sales promotions. But it’s also a reflection of their impact on other retailers, which gradually reframe their own tactics and private label approach to respond to the changing competitive threat and the expectations of consumers clearly enamoured with Aldi and Lidl’s no-nonsense, we-don’t-even-have-a-toilet-or-any-fucking-windows approach to merchandising.

The last, and probably most persuasive explanation is Brexit. Again. With sterling taking a major hit versus other currencies the cost of producing many of the products in the British supermarket has risen and so have prices. Those higher prices and uncertainty about the British economy have sent many British shoppers on a flight to value. Sales of private labels are up around 5% on pre-Brexit levels, and low prices – rather than special offers – appear to be the order of the day across grocery aisles.

READ MORE: How marketers should deal with post-Brexit price rises

That was certainly the opinion of Mike Watkins, who runs retailer and business insight for Nielsen in the UK. “To be more price-competitive, supermarkets have turned temporary price reductions into permanent cuts, so there’s less promotional activity as many prices are cheaper all-year round,” he explained. “There’s also been a shift away from multibuy to simpler price cuts, which is in tune with shopper needs to make it easier to manage their basket spend,” he added.

Whatever the reason, this looks likely to be a trend that will continue for the foreseeable future. Aldi and Lidl will only strengthen their grip on the British high street as we head to 2020. Whatever the long-term economic outcome of Brexit for the UK, the short-term implications for the next few years are already obvious. The UK is a wobbly, worried place for consumers right now and that feeling will see us through until the end of this decade when the twenties (yes, pinch yourself, the twenties) begins.

After almost two decades of domination the age of price promotions appears to be in retreat.

Professor Mark Ritson will be teaching the next class on the Marketing Week Mini MBA in Marketing from April 2017. To find out how it could make you a more confident, more effective and more inspired marketer, and to book your place, click here.

The post Mark Ritson: The era of price promotions is over appeared first on Marketing Week.