Three CEO marketing leadership examples stood out to me recently. Ponder the meaning and implications from 3M, Wal-Mart and United Continental for your team and company.
Singles and Doubles Win Games Too
Sometimes the desire for the new product home run obscures the ability to win by stringing together lots of hits. From innovation superstar 3M, we’re reminded that a series of smaller, yet profitable new product introductions can also lead to company growth. Sure, there needs to be an understanding about benchmarks and hurdles. And, yes, the opportunity costs to execute against new product launches need to be carefully considered. If you can get the home run, great. If you can’t, don’t rule out the singles and doubles, though.
“3M is everywhere. That’s the point George Buckley, the chairman and CEO of 3M, is trying to make as he talks about his favorite subject, inventing things. Last year, he says, “even in the worst economic times in memory, we released over 1,000 new products.”
But 3M has never been about inventing the Next Big Thing. It’s about inventing hundreds and hundreds of Next Small Things, year after year.”
3M’s Innovation Revival – Fortune – September 24, 2010
Know Your Business – Do What You Do Best
Even the best operators can sometimes lose sight of just what it is that they do the best. For Wal-Mart, it’s all about price-point segmentation, and making sure to offer quality products at a range of prices, including the ever-important “opening price point” or value price point. I’ve been in a Chinese supermarket so maybe that’s why the next story jumped out to me. It’s also a terrific example of managerial leadership via a teachable moment (no alcohol required).
“Consider the story of the Chinese bananas. Last fall [Wal-Mart CEO Mike] Duke and Doug McMillon, the new 43-year-old head of Wal-Mart’s international division and an oft-mentioned candidate to be Duke’s successor, flew to China to check in on the company’s fast-growing business there. While scouting competitors, Duke became preoccupied with the price of bananas. All the local stores they visited, he noticed, sold both domestic and imported versions of the fruit — and they didn’t appear much different in quality. But the homegrown kind cost about 20% less, on average, than the foreign fruit. Then Duke and McMillon walked into Wal-Mart’s Wanda supercenter in Beijing. Duke went straight to the produce section and found that while Wal-Mart had a better price on imported bananas, it didn’t have cheaper domestic bananas in stock at all. The CEO pointed out to McMillon and the local executives that Wal-Mart was ceding the entry-level portion of the banana market — not exactly the formula that a little discount chain from northwestern Arkansas used to become the world’s biggest retailer. At that point Duke’s team reacted with the kind of speed and efficiency that would make Sam Walton smile. Within 24 hours, the Wanda supercenter had local bananas in stock at a market-beating price. In less than a week, all 49 stores in Wal-Mart China’s North Region had them, followed quickly by the rest of its nearly 300 stores across the country. But for Duke the issue was not about the price of fruit alone. “It turned into a great conversation about opening price-point items: 10-packs of chopsticks, soccer balls, basketballs,” says McMillon. “We started looking around the store differently because of his attention to detail.””
Meet the CEO of the Biggest Company on Earth – Fortune – September 9, 2010
Make Sure Employees Can Make it Happen for Customers
So much time and effort is spent positioning products and services to customers that sometimes we forget that it’s the internal employees who bring it all to life. And if they don’t live and breathe the positioning, forget it, because it’s not going to happen in the marketplace.
“I am going myself to focus very heavily on the culture. Culture is incredibly important in a service business. I can lecture about service and we can train about service, but the employee is not going to give good service unless the employee wants to. They want to give good service if they enjoy coming to work, trust their co-workers [and] are given the tools they need to do their jobs.”
Interview with United Continental Holdings Inc.’s CEO Jeff Smisek – The Wall Street Journal – October 11, 2010
Headline For Marketers
Three points. One, don’t let the quest for the home run put a wrench into your innovation efforts. A string of profitable new launches can be successful too. Two, remember who you are as company and make sure to execute against that identity every day. Three, you can’t deliver greatness to customers without fully engaged employees. Make sure your entire team is prepared every day.
Harvey Chimoff is a hands-on marketing leader and business-wide collaborator who builds marketing capabilities in B2B/B2C organizations that drive customer success.
2 thoughts on “Tips from the Top”
Wonderful to see the trend emerging, of bringing care and respect for customers into focus in marketing strategies that work. I believe that marketing in the 21st century will be social, or will not be at all, to paraphrase a famous quote about spirituality from more than a decade ago. A new breed of “social marketing” stripped off of all negative political connotations that will put forward the interest of its customers and their well-being. This new model will most surely bring a natural flow of success and high returns in a post-industrial era where people are more enlightened, knowledgeable and discerning customers.
The 3M strategy is similar to Rubbermaid who churns out plastic/rubber products for the home at a very fast rate. It is probably the right direction to take for companies who have flexible and resilient production systems and operating in markets where innovation is key to competing.