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THE TOP 10 MARKETING TOOLS FROM ACADEMIA

Havent the time or inclination foracademic theories? Helen Edwardsoutlines some of the best to make you

think again.

Its become respectable to dismiss the output of academics as irrelevant toreal-world marketing. The tortuous language, the lack of hands-on experience what do theyknow? Quite a lot, as it turns out - if you know where to look.Over the years, the leading business academics have devised elegantmodels, frameworks and methodologies to help guide decisions on thefundamentals that underlie the discipline of marketing. A working knowledgeof the best of these tools could save hundreds of hours of consultants fees.

Here are ten that any self-respecting marketer should have in the toolbox.

1. Value Innovation and The Value CurveWho designed it: ProfessorsW. Chan Kim and Rene Mauborgne, Insead.(1997)

What its good for: Breakthrough innovation

How it works: TheValue Innovation System mounts a challenge to categorynorms and assumptions by forcing answers to four uncompromisingquestions. These include the counter-intuitive, Which factors could bereduced well below the industrys standard? In other words, you start byasking how you can make your product worse. But this is the genius of thesystem, since it liberates resources to make giant leaps in areas thatcustomers valuemore.

The Value Curve plots your offer compared with the typical industry profile. Atthe outset, it can be a graphic and humbling reminder of lack of differentiation.The eventual aim is a curve completely out of kilter with the norm for thecategory.

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Who uses it: Accor Hotels is the classic case. Their Formule 1 concept cameto dominate the low-price hotel industry in France by drastically reducing roomsize, service and lobby space in order to provide what a broad mass ofcustomers wanted more: a good nights sleep at a low price.

What to watch out for: The aim is sweeping change, so itsnot for the faint-hearted.

Where to find more: Value Innovation: the Strategic Logic of High Growth,Harvard Business Review, July 2004.

2. Porters Five Forces of Competition FrameworkWho designed it: Professor Michael E Porter, Harvard. (1979)

What its good for: Market entry strategy

How it works: Industries are not equally attractive. Airlines, for example,have traditionally struggled to repay the cost of capital. US guru MichaelPorter showed early in his soaraway career that the difference is notaccidental, identifying the five forces that govern profit potential: existingrivalry between firms within the industry; the threat of new entrants; the threatof substitution; the bargaining power of suppliers; the bargaining power ofbuyers.

Porter, whose great gift is for simplifying complex concepts, presents theseforces in a convenient five-box format. Each force comes with a check-list ofsub-factors to help analyse its role in the risk-reward profile of the industry.Eyeing up new markets is easy; the framework can help show why getting itright is anything but.

Who uses it: A favourite of management consultants.

What to watch out for: Works better in mature industries.

Where to find more: How Competitive Forces Shape Strategy, HarvardBusiness Review, March-April 1979. Book: Contemporary Strategy Analysis,Blackwell Publishers, 1991.

3. Market-Oriented EthnographyWho designed it: Professor Eric J Arnould, University of Nebraska, ProfessorMelanie Wallendorf, University of Arizona. (1994)

What its good for: Rich consumer insight

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5. Hierarchy of Effects ModelsWho designed them: Various luminaries, including Lavidge and Steiner, LarsFinskud, and Professor Nader Tavassoli of London Business School. (1961-2004)

What theyre good for: Assigning marketing budget.

How they work: Like an old standard thats been covered by all the topartists, the concept of the hierarchy of effects has spawned numerouspractical models. Lavidge and Steiner started things rolling in 1961 with theirseminal paper in the Journal of Marketing. It postulated a funnel with sixstages that consumers must move through in order for advertising to beeffective.

Best of the modern funnels is Lars Finskuds Customer Choice Chainbecause it broadens the scope beyond advertising effect. There are sevenstages that separate brand ignorance at one end from brand advocacy at theother. By plotting how many customers you lose at each stage, compared withrival brands, you can see where your weaknesses are and whereexpenditure would be most justified.

Who uses them: Few do, all should. A proper, fact-based choice chain willoften come as a revelation to marketers more used to making assumption-based judgements.

What to watch out for: These are quant tools, not merely illustrative models.They require (and repay) the investment of time and money to get thenumbers for each stage in the funnel.

Where to find more: Book: Competing for choice, Vola Press, 2004.

6. Service MappingWho designed it: Professor James L Heskett, Harvard. (1980)

What its good for: Improving customer service

How it works: A service map makes the reality of service delivery graphic.Each separate step in the process of service is mapped in a strict horizontalsequence. But some steps are separated vertically, too, by a line of visibility.Above the line, activities are visible to the customer like taking the order in arestaurant; below the line they are not like washing up .

The map gives an at-a-glance hint at potential failure points in a number ofways.

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Some are vulnerable to supplier delivery; complex loops with lots of stepswarn of log-jams; too many steps below the line of visibility indicate lack ofvalue perception from customers. With an accurate map in place, streamliningand improving service becomes dramatically easier.

Who uses it: Auto repair businesses and restaurant chains are cited byHeskett. Ad agencies should give it a try: it would show at a glance why theirmargins are thin and their clients frustrated.

What to watch out for: People issues. Complexity preserves jobs, sosimplifying service loops can be seen as a threat.

Where to find more: Book:Service Breakthroughs, The Free Press, 1990.

7. Brand Relationship SpectrumWho designed it: ProfessorDavid A Aaker, University of California. (2000)

What its good for: A strategic approach to brand architecture.

How it works: What is dignified by the term brand architecture often moreresembles jerry-building. An acquisition here, a line extension there, and youhave an architecture that owes more to accident than to design. When thetime comes to reorganise the portfolio from strategy up, Aaker is the place to

start.

The spectrum model assembles the various options under four basicstrategies: house of brands, endorsed brands, sub-brands under a masterhouse, and a branded house. Working like a family tree, it then plots furtherdivisions for each of these, with relevant examples. Finally, there is a batteryof well-conceived questions to help you arrive at the best architecture for yoursituation.

Who uses it: Any self-respecting brand strategist. Leslie Butterfield is a notedproponent.

What to watch out for: Its a simple tool without obvious drawbacks. Betterto watch out for the problem of ill-conceived architecture in the first place.

Where to find more: Book: Brand Leadership, The Free Press, 2000.

8. Change EquationWho designed it: Richard Beckhard, Adjunct Professor at MIT Sloan Schoolof Management, based on work by David Gleicher, of Arthur D. Little. (1987)

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What to watch out for: This tool was designed to measure overall corporateperformance, but can be adapted to focus specifically on brand performance.

Where to find more: The Balanced Scorecard Measures that DrivePerformance, Harvard Business Review, January-February 1992. Book:

Creating Passion Brands, Kogan Page, 2005.

10.Doyles Five Criteria for SegmentationWho designed it: Professor Peter Doyle, Warwick University. (1994)

What its good for: Segmentation that makes sense in the real world.

How it works: The late, great Peter Doyle contributed so much to the practiceof marketing, that it would be remiss to leave him out of this top 10. Althoughhis criteria for segmentation is presented as checklist, rather than a snazzyframework or model, its study will repay all those who suspect that the lure ofsegmentation can be false. (It can.)

The five criteria are: 1. Effective: are the needs of people within the segmenthomogenous but different from the needs of people outside? 2. Identifiable:can customers in the segment actually be isolated and measured? 3:Profitable: is the segment large enough to still achieve economies of scale? 4:Accessible: can the segment be reached in media without too much overlap?

5: Actionable: does the business have the resources to segment its offer inthe first place?

Who uses it: London Business School MBAs.

What to watch out for: Planners who dont.

Where to find more: Book: Marketing Management and Strategy, PrenticeHall, 1994.