Saturday, November 29, 2008

Integrated marketing

In both the corporate and non-profit worlds, one tends to find four different mindsets about marketing:
  • The first believes marketing equals sales and advertising;
  • The second thinks marketing equals the "4 Ps": price, product, place and promotion;
  • The third believes marketing includes segmentation, targeting and positioning (i.e. the 5th “P”, people) and next the 4 Ps;
  • The fourth considers marketing to be the driver of business and the source of the institution's growth in the market.
Too many MFI managers live in the first and second mindsets. This has the affect of bottling up the power of marketing. The market research “genie” remains corked in her container, only to be unleashed for special projects, if at all. But by doing so, market intelligence is under-utilized, neither informing strategy nor enhancing day-to-day operations.

In a market-driven MFI, market intelligence drives pricing, product design, distribution methods and speed of delivery, sales, promotion, and the company’s overall strategy. Market intelligence flows throughout the MFI, and MFI staff provide feedback to the marketing department.

MFIs can improve the role of marketing within the organization, first by determining how marketing is actually seen within the MFI. What mindset do the CEO and other staff members have about marketing? Is marketing respected within the MFI, or seen as a waste of time?

Next, MFIs can properly structure the marketing department. In mid- to large-size MFIs, there should be a marketing department headed by a Chief Marketing Officer. This department manages market research, product development, and promotion (the latter includes everything from sales training to advertising). In small MFIs, a single person may be in charge of all of these functions, closely coordinating with other department heads.

Action item: To start integrating your MFI’s marketing, first review which reports upper management and loan officers receive from your marketing department, and how often. At a minimum, I’d recommend:

• Customer drop-out reports to upper managers and loan officers - quarterly;
• Customer satisfaction reports to upper managers and loan officers - quarterly;
• Market trends report to upper management - annually;
• Competitive analysis to upper management and loan officers - twice a year;
• What else would you add? Please comment and let me know!

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