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<title>Market Leader Magazine</title>
<link>http://www.warc.com/</link>
<description>Market Leader is the quarterly journal of The Marketing Society. It addresses important issues in marketing and business, keeping its readers abreast of new ideas, trends and thinking.</description>
<copyright>World Advertising Research Center Ltd 2009</copyright>
<lastBuildDate>Mon, 10 September 2007 12:50:00 GMT</lastBuildDate>
<generator>World Advertising Research Center</generator>
<editor>Editor@warc.com</editor>
<webmaster>webmaster@warc.com</webmaster>
<ttl>5</ttl>
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<title><![CDATA[Brainwaves - our selection of light-reading food for thought from around the world of marketing.]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89634</link>
<author>Winston Fletcher</author>
<description><![CDATA[This is an article in two parts. 1 Advertising agencies used to call themselves by the names of all their founders, which could lead to accusations of poor branding as shown in an anecdote; there is a case for saying that clients should know who their founders are, since it is their philosophy that governs the service they provide. 2 An account of how Sony lost the iPod market, which should have been theirs by their leadership in portable music and miniaturisation; their error was to offer two different products, created in two non-co-operating silos, both inhibited by restrictions imposed by a third silo Sony Music concerned more about avoiding piracy than the success of the product. The resulting failure left the way open for Apple's product. This is an object lesson for co-operation, communication and breaking down silo isolation.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[&#8216;I'm sorry &#8211; you've lost me': five words a brand should never have to hear]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89635</link>
<author>Jeremy Bullmore</author>
<description><![CDATA[In good times, as companies grow, it is all too easy for them to lose touch with their customers, without being aware of it. In times of recession the risk becomes greater and more obvious: people think more, review their behaviour, and if a brand has `lost' them they will abandon it. Paradoxically, this recession is a good time for those companies who are deeply concerned about keeping in touch with their consumers. The old notion of consumers as a passive, obedient mass has been finally blown, thanks to the empowering effect of digital media in which consumers freely express themselves. This has opened up a whole new way for companies to keep in touch, involve and participate with real consumers, and those who embrace this opportunity will win over those who don't.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[Advice to brand managers: loosen up]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89636</link>
<author>Martin Thomas</author>
<description><![CDATA[This article argues that managers are kidding themselves if they think they are in control of their brands. Today's more active, empowered consumers require a looser, more flexible approach. Yet, too many brand managers still believe that a brand can, and should, be protected from any outside interference, and that a brand's communication will be treated by consumers with  respect. Most processes and methodologies used to develop a brand's identity and positioning, or plan brand communication, remain predicated on the notion of absolute control. But a new generation of marketing professionals, dubbed `crowd surfers' has emerged to engage with consumer empowerment. They have a more flexible philosophy of brand management that celebrates the virtues of collaboration, dialogue and criticism. Crowd surfing does not mean abdicating all control, but it does mean that the planning of brand identities, positioning and communication needs to be done with consumer empowerment in mind; brands should appear `more humble'; rather than worrying about protecting the image and integrity of a brand at all costs, brand owners should be more relaxed and accept the `messiness' introduced by the crowd since there is no way it can be stopped.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[After the recession: resurrecting the reputations of the banks]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89637</link>
<author>Keith Lucas</author>
<description><![CDATA[The banking crisis has destroyed the status and respect in which banks were held. Yet the same handful of undifferentiated bank brands continues to offer essentially the same financial products, with the same lack of customer focus and in the same perfunctory manner, that they have for decades. Behind a facade of being customer-focused, they have failed to deliver, and customers have become so dissatisfied that the banks have been forced to accept a new FSA watchdog, and will now face fines for poor treatment of their customers. New rules will make it easier to switch accounts and for competitors to offer financial services. With enough capital, it seems simple to set up a bank. Marks  amp; Spencer, John Lewis, Virgin and Sainsbury's have already been leveraging their customer relationships to provide targeted financial services, and have the customer empathy and marketing sophistication to anticipate and respond to their needs in a way no bank ever could. Others e.g. Apple could do likewise. There are just two UK banks that demonstrate the required customer focus: HSBC and the Co-operative Bank. To ward off such competition, banks must start taking it seriously, get close to their customers and exert themselves to win their loyalty.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[Get ready for the &#8216;new normal']]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89638</link>
<author>Adrian Ryans</author>
<description><![CDATA[In the recession people are turning to cheaper products, and often finding that they are as good as, or even better than, the more expensive versions example: Aldi and Lidl, the discount stores. Such habits will persist when the economy improves; in many markets, lower-priced competitors will be more prominent. Mindless price-slashing is the wrong way to counter this trend; companies should first ascertain which elements of their offering create customer value, and cut only those that do not. There are three options for fighting low-cost competition: meet it head on, improve products or services, and try to build enduring relationships with customers so that they are les focused on price. One option is to create a separate low-cost offering e.g. Dow Corning with Xiameter; it is better to keep this completely separate from the premium business. Apple's success in distancing itself from commodity MP3 players described has been largely due to its integrated and customer-friendly solution iPod. Both these products were launched during the last downturn; recessions are times when it is easier to launch new products and get customer attention.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[Is the traditional client&#8211;agency model now out of date?]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89639</link>
<author>Will Harris</author>
<description><![CDATA[This article predicts that continued recession may mean the demise of the traditional advertising agency. Clients' budgets are squeezed and have to work harder. They continue to support their brand with consumers, but much more cheaply through digital than through traditional media. Results can be spectacular if they are well-advised, especially if they use one of the new PR agencies which are fusing PR with digital. Agencies are concerned more about context and content than about traditional advertising, and seek lower-cost production. The agency model is predicted to evolve to in-sourced event production, at the same time as much of the low-margin TV production facilities will be out-sourced. The recession is forcing agencies to adapt faster than they would otherwise; the length of the downturn will determine how permanent these changes will be.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[What the agency model can learn from other markets]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89640</link>
<author>Rory Sutherland</author>
<description><![CDATA[This paper argues that many businesses fail to distinguish between price and transaction costs, and fatally ignore the latter while trying to reduce the former. Low-cost competitors may succeed not because their prices are lower but because they have made the purchasing process easier and less time-consuming e.g. ability to book tickets online. Failure to understand the deterrent effect of transaction costs caused the music industry's disastrous refusal for some years to sell online other examples are quoted. Reducing the emotional cost of difficult transaction may be much more important than reducing price. The same problem applies to advertising agencies: too much attention is now being paid to reducing the price of what agencies do, whereas the real attention needs to be spent reducing the other costs. The splintering of agencies into different disciplines, and the fragmentation of media, have made choices more complex and unwieldy; decision making is time consuming and coordination costs have soared. Agency elements should co-operate better to simplify the package offered; at the same time we should challenge the remuneration system which penalises efficiency and rewards for process cost, not value, and also tortuous client approval procedures that magnify transaction costs. Pay is not the issue, but the high cost of everything else.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[Creative industries play a key role in the knowledge economy]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89641</link>
<author>Ian Brinkley</author>
<description><![CDATA[The worldwide growth in the `knowledge economy' since the early 1980s, fuelled by powerful, cheap technology and consumer demand, has been unstoppable; by 2004 UK business investment in knowledge-based intangible assets was 1.4 times investment in physical assets, having been only 40% in 1970. The creative and cultural industries, within the knowledge economy, have also grown figures given, to the extent that they are now recognised as an integral and important part of the economy as a whole, and profitable investments in their own right, not merely the recipients of grants and subsidies. It is unclear, however, how the present deep recession will affect these industries. Some kinds of spending hold up better than others in recession, but there are no benchmarks from earlier recessions to tell us what will happen to knowledge-based industries. A worry is that they may find it harder to get support from banks because of the difficulty of valuing `intangibles', which could lead to substantial cuts in areas such as R amp;D, strategic advertising, software, design, and human and organisational capital. It is argued that the government should develop an explicit strategy for developing the UK's knowledge economy and encouraging investment in it. The creative industries themselves should do more to compile and present the evidence for their importance to the economy.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[Day of the clones]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89642</link>
<author>Simon Silvester</author>
<description><![CDATA[This paper argues that the most important thing for a brand is its differentiation from others; yet it is less and less being achieved, because all the marketing pressures best practices, benchmarking, best research, management practice etc. impel towards brand cloning: effectively, competitors copy each other. Digital marketing has intensified this trend; the digital world instantly exposes a brand which is a dull also-ran. Today, entire industries e.g. telecoms are following identical marketing strategies. Y amp;R's global BrandAsset Valuator tool described, which is the only global study that actually measures differentiation, has produced evidence of this trend to cloning. Clone brands struggle to attract customers; they have all failed in the past; cloning can happen very fast typically, differentiation collapses within two years after launch; clone brands cannot range-extend; they are always fighting me-toos and own-labels; they have the lowest margins. Differentiation produces awareness, not the other way round, and is what makes a brand grow in knowledge and esteem. Coke, Ikea, Nike, Starbucks, Activia and iPod are all examples of highly differentiated successes.  Differentiation takes courage not to follow the crowd e.g. Activia.  Advice with examples is offered on how to grow differentiation: talk to non-users; get a vision; keep developing the offer; convey a sense of dynamism; use scarcity; be brave; rethink the business model; don't worry about value for money.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[Differences between the sexes: it's all in the brain]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89643</link>
<author>Collette Dunkley</author>
<description><![CDATA[Science is now demonstrating that men and women have different genetic brain structures which lead to differences in how they tend to think and behave, including buying and shopping. Yet most marketing companies still fail to understand and adapt to these differences. Those that do reap rewards.  Both internal; and external communications need to be recalibrated to allow for the different ways men and women behave, both at work and in the marketplace. Examples include: measuring customer satisfaction separately for men and women; employing female as well as male creative directors;  delivering different messages for their different interests; varying the marketing mix for men and women; teaching staff to deal differently with male and female customers; different website designs and online messaging; accepting and adapting to different  internal working styles.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[How brand equity metrics drive brand strategy]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89644</link>
<author>David Haigh</author>
<description><![CDATA[This article argues that in a recession branding, and brand management, become more important, not less; recession provided opportunity for those companies which understand this. In recession, not only price but other drivers of consumer preference may change, and managers of premium brands need to learn how to adjust them all. Brand equity attributes or demand drivers can be classified in three ways: functional, emotional and conduct of the company; all these can be subdivided into many detailed components. It is possible to statistically model and predict the effect of changing performance on each driver. By understanding what matters to a consumer at a given point in time and understanding how that consumer rates the performance of each brand in the marketplace, brand managers are able to explain and predict brand preference and demand example: how Coke and Pepsi have compared over time. A brand can also enhance the performance of subordinate or partner brands by improving their performance on key attributes example: Vodafone. The costs of improving a brand's performance on each driver can be analysed and compared with the value gained examples: fair trade practices, which cost little but have created a price premium. Tracking is essential, though difficult as consumer views change in recession, sometimes considerably examples: Wal-Mart, McDonalds which have risen in consumer perception, versus other examples which have fallen: quantitative research budgets should be defended. Research is quoted showing the macro-and micro-drivers which move customers in the residential energy market. Brand maintenance requires strong discipline and leadership from the top, so that the brand's `promise' is kept example: Virgin. Other stakeholders as well as customers need to be tracked and responded to.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[From bags to riches: the success of Radley handbags]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89645</link>
<author>Julian Calderara, Les Binet and Sarah Carter</author>
<description><![CDATA[This paper tells the success story of Radley handbags 2007. A brief history of the company is given; the company was acquired by a private equity firm, Phoenix Equity Partners, in 2006 for  amp;pound;42 million. The marketing plan was a to persuade more women to buy Radley handbags, b to build premium values, encourage women to trade up, and increase average pricing, c establish the brand's credentials in the industry, supporting extensions into new marketing areas and internationally. Problem: the product was functional but not `fashionable' discussed. Creative idea and campaign described, mainly in women's magazines. Results: high awareness and PR; volume sales increased 9%, market share 12%; value sales increased 21%; rate of growth increased by 2.4%, which can only be explained by the advertising. A payback of 47% ROMI is estimated. The company was sold at end 2007for  amp;pound;130 million, an increase of  amp;pound;88 million in value in just 18 months. The ads are estimated to have increased the value of the company by  amp;pound;3.75 million. This case shows how small budget campaigns can produce big effects on profits and can be rigorously evaluated; also that private equity companies do not always destroy companies for short-term gain: in this case, Phoenix provided bold commitment and financial backing for Radley, while demanding a rigorous approach to analysing return on its investment.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[Ready for Enterprise 2.0?]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89646</link>
<author>Marian Berelowitz</author>
<description><![CDATA[Enterprise 2.0 is a term encompassing all the web-based tools that facilitate networking and collaboration, and the shift from desktop to web-based applications. This article argues that companies will benefit by enabling their employees who are increasingly used to them in their private lives to use these tools at work. The disparate tools included under Enterprise 2.0 a full glossary is provided help employees share and organise information, broaden horizons and flatten hierarchy, and tend to be most valuable when colleagues in large organisations are spread out across offices and time zones. Various surveys and other evidence including a worldwide survey of 2000 executives by McKinsey are quoted showing to what extent companies and their employees are now using these tools. Where they are accepted, management practices change. But in many companies technology is not enough to overcome the cultural obstacles that prevent the free flow of knowledge. The potential benefits are: increased innovation, shorter development cycles, more engaged employees, better communication, better relationships, more agility within the organisation. The greatest barrier to adoption is the difficulty of giving up control. But increasingly, employees will demand the necessary cultural change and will not submit to structured information environments and silo working.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[From CMO to CEO: the route to the top]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89647</link>
<author>Jonathan Harper and Frank Birkel</author>
<description><![CDATA[An increasing number of CEOs are being appointed who have a strong marketing pedigree. This article discusses the options and challenges facing Chief Marketing Officers CMOs who wish to rise farther in the company, based on a global survey of CEOs with marketing backgrounds and top-flight CMOs. The ambitious CMO should not be content to stay inside his specialism: he must learn about the company as w whole, admit what he doesn't know, and demonstrate analytical ability and understanding of the factors that affect the P  amp; L. The necessary skills are easier to demonstrate in companies which are directly involved in satisfying consumer needs especially fmcgs. Some CEO skills cannot be prepared for in advance: the CEO must lead, be less hands-on, be able to take risky decisions with less information, evaluate the information he receives in a different way. However, the CEO should always be the company's `chief marketer'. A list of guidelines is offered.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[The dangers of common sense]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89648</link>
<author>Les Binet</author>
<description><![CDATA[This paper summarises key findings from the author's review of IPA case histories Binet and Field, 2007 to show that much of what is conventionally believed about how advertising works is wrong.  Key points are: 1 profitability comes not from sales increase but from reducing price sensitivity; 2 penetration campaigns are three times more effective than loyalty campaigns; 3 awareness and image correlate poorly with business success: fame is much more important, especially word of mouth people need to be actively thinking and talking about the brand; 4 successful ads stimulate emotional response rather than delivering a message; 5 ad standout is only weakly correlated with effectiveness: likeability is more important. If the prevailing model of advertising effectiveness is wrong, it leads to much money being wasted e.g. in the wrong sort of pre-testing.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[Marketing for next to nothing]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89649</link>
<author>Julian Saunders</author>
<description><![CDATA[The web was first seen as a sales response medium, but all marketing functions have now migrated to it. The article considers who will benefit most. Top of the list are entrepreneurs and small businesses who look outside for resources; they can exploit a range of web-based services listed at little or no cost. Big organisations can release the energy of their employees. Others that will use the web include organisations with strong ethics; the sales promotion industry; brands with a strong point of view; criminals; governments willing to be open; geeks. Investment is shifting away from entry costs to ideas and design.]]></description>
<pubDate>1 Jun 2009</pubDate>
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<title><![CDATA[Business in Korea: a two-speed system that will get them a long way]]></title>
<link>http://www.warc.com/articles/MarketLeader.asp?ID=89650</link>
<author>Bruce Haines</author>
<description><![CDATA[This article discusses how a Korean company is facing up to the global economic downturn. One strength is that Korean businesses look to the long term and are not panicked by short-term reverses. There is widespread ambition for success and confidence that it will continue. There is commitment to continuous training, including travel to spend time in countries where the company may one day need a presence. Everyone is taught to speak English.]]></description>
<pubDate>1 Jun 2009</pubDate>
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