Pull yourselves into the future

A modest proposal for the new year: shorten your lead time to market, whoever you are, and in whatever sector you work. A shortened lead time not only helps to put one over on the competition, it also works wonders for consumer perception of your brand.

Take car manufacturing, for example. Despite massive rationalisation, the sector continues to carry a heavy, product-led, consumer unfriendly heritage. Car makers remain the archetypal ‘push’ marketers. To an extent this is perfectly understandable, given that they work in a mature environment characterised by huge inventory, long-term capital investment and chronic overcapacity. Pushing the pre-fashioned metal off the production line and into the forecourt, no matter what the consumer really wants, remains the priority.

A hint of this mentality is betrayed in Ford’s recently revealed plans to replace its current range of small, mass-market vehicles. At the moment, the range – led by the Ka in Europe – is heterogeneous, for which read unbearably costly at a time when Ford is incurring record losses. Ford hopes to produce what it calls a global platform – effectively a less expensive single car type which is equally appealing to Asian and European buyers. As even Ford admits, ‘one size fits all’ may not be possible, given the vast differences in consumer expectations, and disposable income, on those two continents.

The thinking at Ford’s main rival, General Motors, is little different, though GM has been more successful at implementing it. The solution to sliding market share and idle capacity has been to press-gang marketing into a high-octane but pedestrian programme of incentives and price promotions, which shifts product at a grievous cost to shareholders.

It is Toyota’s performance, rather than GM’s, which commands real respect. This is a major car company that is increasing its share in the US and Europe alike without incentives and margin sacrifice. As Alan Mitchell points out, in the first half of 2002, Toyota’s global profits were greater than GM’s, Ford’s and Chrysler’s combined. It is hard to avoid the conclusion that much of this achievement is down to its flexibility and responsiveness to consumer needs, encapsulated in Toyota’s renowned ‘just in time’ philosophy.

If only there were a Toyota in other lazy, product-led sectors, such as financial services. True, banks and building societies are quick enough to communicate with consumers when it comes to paring their already paltry savings rates. But elsewhere innovation, speed and responsiveness are rarely encountered. For here is an industry that remains obsessed with competitor advantage rather than consumer interest – despite its copious marketing communications budgets.

Luckily, financial services is pretty exceptional. Most sectors show some signs of moving from the ‘push’ to ‘pull’ model. We see it, within the retail sector, in the grocery majors; with Dell in the technology sector; with the innovations of Stelios Haji-Ioannou and Michael O’Leary in the unpromising travel business.

Some industries by virtue of their youth, entrepreneurial flavour and investment profile lend themselves better to the ‘pull’ model of marketing than others. But all can learn to be more flexible towards the consumer. Because, make no mistake, that’s the way the world is moving.

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