News from Cass Business School

How the marketing chain can improve and avoid waste

Tuesday, 22 September, 2009

A new study by Bob Shaw, Honorary Professor of Marketing Metrics at Cass Business School, and Philip Kotler, Professor of International Marketing, Kellogg School of Management, reveals that companies should not cut their marketing costs during the recession, but should improve efficiency instead.

The academics created a new concept called Ideas-To-Demand (I2D), a process aiming to reduce complexity and improve controls in organisations. They worked with over 100 organisations and researched how those businesses struggle to stimulate demand while trying to keep costs down. This research claims there is 20 to 30 percent of avoidable waste in marketing which can be eliminated by adopting certain changes in idea generation, production, distribution and analysis of demand patterns.

Professor Shaw says: Marketing is the function which has the most troublesome relationship with the board. Companies who spend a billion pounds in marketing didn’t realise that the whole thing could be done more efficiently.  Shaw also disagrees with the outdated argument that marketing results are long-term and cannot be measured. He argues that non-financial measurements such as brand awareness do not have clear benefits: In a recession, brand awareness is not a substitute for sales.

Looking at reasons for success and failure, the researchers formed a performance improvement framework, suitable for any company in any market. There are different points for every step of the I2D process all focusing on efficiency.

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Bob Shaw, Honorary Professor of Marketing Metrics at Cass Business School

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