Online Exclusive: Al Ries Column

WHAT CEOS JUST DON'T GET ABOUT MARKETING

Good Execution Can't Save Bad Strategy

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Marketing is in trouble. Marketing is getting squeezed between the top management function and the advertising function.
Previous Ries Columns:
WHAT HEWLETT-PACKARD SHOULD DO NOW
Marketing Strategies for the Post-Carly Era
BURSTING THE BUBBLE OF DIGITAL CONVERGENCE
Why the Product Concept Is Out of Sync With Reality
AMAZON.COM: A CHAMPION ONLINE MONEY LOSER
How an Internet Marketing 'Wizard' Went Wrong
DISSECTING THE WRECKAGE OF AIRLINE MARKETING DISASTERS
How the Industry Giants Lost Focus and Crashed
THE MARKETING POWER OF A SINGLE EFFECTIVE WORD
And Why You Must Anchor Your Brand With One

Top management insists that marketing is nothing but common sense (and therefore anybody with a title can do it) and the advertising function insists that marketing is nothing more than advertising.

The Fiorina fiasco
The Fiorina fiasco illustrates the problem at the top.

Here is a person who majored in medieval history and philosophy in college, went to law school but dropped out, earned a master of business administration from the University of Maryland and a master degree in science from M.I.T.’s Sloan School.

After business school Carly Fiorina’s first job was in government sales at AT&T. She spent 16 years at Ma Bell and another three years at Lucent Technologies, eventually becoming president of Lucent’s global service provider business before snaring the top job at Hewlett-Packard.

Media portrayal
After five-and-a-half years, the H-P board asked her to resign. So how was Carly Fiorina described in the media?

"A slick marketer" (USA Today).

"A high-powered marketing whiz" (Newsweek).

"Carly tried to impose ... a marketing culture on a company with an entrenched engineering culture" (The New York Times).

"A sales whiz known for high-profile marketing events" (Business Week)

Complete disagreement
A slick marketer? A high-powered marketing whiz? A sales whiz known for high-profile marketing events? I've written 11 books on marketing and spent more than 50 years in the marketing field, and I don't agree with anything Carly Fiorina has done involving marketing strategy at Hewlett-Packard.

"Synergies," according to Carla, would eventually make H-P a leader in all of its businesses. What marketing expert runs around the country talking about synergies? Only CEOs and investment bankers do that.

A slick marketer? My tastes run more toward Sidney Frank, who at the age of 77 launched Grey Goose vodka and seven years later sold the brand to Bacardi Ltd. for more than $2 billion.

Or John Schnatter, who in his early 20s started selling pizza after tearing out a broom closet to put a pie oven in a bar co-owned by his father in Jeffersonville, Ind. Ten years later, the company went public as Papa John’s Pizza.

Or Gary Heavin, who sold his first Curves franchise in 1995 and now has a franchised chain with 8,000 locations and more than $1 billion in annual revenues.

Could've been a good CEO
With her enthusiasm, energy and drive, Carla Fiorina might have made a fine CEO of Hewlett-Packard ... if she had a marketing expert behind her whispering strategies in her ear.

"Marketing takes a day to learn," according to America's most famous marketing professor, Phil Kotler, "but a lifetime to master."

Yet there is a widely held belief, especially among top management, that marketing is nothing but common sense. And nothing is more common among CEOs than the belief that they have a full deck of common sense.

How do marketing people deal with CEOs who have the power to make strategic marketing decisions without the marketing experience only a lifetime of marketing work can accumulate? I wish I knew.

I have spent many days in many boardrooms in many countries arguing with CEOs and their staffs. Most of these battles I have lost.

The CEO: 'We'll do it my way'
"We’ll do it my way," the typical CEO says, "but I’m counting on our marketing team to do a great job executing the program."

Marketing is 90% strategy and 10% execution. With the right name, the right target audience, the right position and the right timing, most marketing programs are bound to work. The difficult part is the 90%. The easy part is the 10%.

Execution depends primarily on people. And people are people. Do you suppose Dell has better people than Hewlett-Packard and the other PC manufacturers? Is that the reason, according to one estimate, why Dell makes more than 100% of the PC industry's profits?

Not the way I see it. Dell's strategy -- be the first to sell direct -- drives the company's execution. If you sell by phone or the Internet, there's no need to have an inventory of finished computers or computer parts. You build to order. You force your suppliers to deliver parts on a just-in-time basis. That's only one of the many "executional" advantages of a direct-only strategy.

A strategy of better execution
Good strategy improves execution. As a matter of fact, good strategy can be defined as a strategy that will allow better, more consistent execution. "We fall into error," says history’s greatest military strategist, Carl von Clausewitz, "if we attribute to strategy a power independent of tactical results."

Good execution cannot change or improve a poor strategy.

Apparently the Hewlett-Packard board had no problem with Carly Fiorina's "all things for all people" strategy. According to H-P Chairman Patricia Dunn: "The board is firmly committed to the business strategy that is in place." Interim CEO Robert P. Wayman echoed her comments: "I have great confidence in our ability to execute the strategies and plans we have put in place."

The creativity issue illustrates the problem at the bottom.

The creative Big Idea
As the keepers of the marketing torch, the advertising agency insists that it is a "marketing partner" with its clients. And that its role is to find a "creative" solution to the marketing problem. "The big idea," in agency parlance.

And what is a creative solution? It's a solution so new and different that it can't help but win an advertising award.

I can see it now. There's a meeting between CareerBuilder.com and its advertising agency.

"I have the creative solution to your marketing problem," says the creative director.

"And what’s that?" asks the client.

"Monkeys."

(You probably saw the three monkey spots that CareerBuilder.com ran on the Super Bowl at a cost of $2.4 million each.)

Don't blame the ad agency
I don't blame the advertising agency. You don't win new accounts by winning marketing awards, since there aren’t any. You win new accounts by winning advertising awards.

The day our longtime marketing hero Procter & Gamble set up a computerized system that uses advertising awards, including a measure of awards per client dollar spent, to rate advertising agencies is the day I gave up on ever convincing clients that the objective of an advertising campaign is not to win an advertising award. It's to establish a position in the mind of the prospect.

It was Hewlett-Packard co-founder David Packard who said, "Marketing is too important for the marketing department."

If not the marketing department, who then? The fiasco at H-P suggests that top management is not the answer. Nor is the advertising agency.

Marketing is in trouble.

~ ~ ~
Al Ries is the author or co-author of 11 books on marketing, including his latest, The Origin of Brands. He and his daughter Laura run the Atlanta-based marketing strategy firm Ries & Ries. Their Web site is Ries.com. (

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