Tuesday, August 25, 2009

Does David have to grow up?


My book, No Money Marketing, published by Tata McGraw-Hill will be in stores this month. It is mostly about upstart marketing techniques – how a David can leverage the flat world to beat the incumbent Goliaths. It is based largely on my own experience at two of India’s most successful brands – Infosys and Wipro. Both of these have experienced upwards of 30% growth every year to become $5bn IT firms competing with incumbents such as Accenture and IBM. Since we couldn’t have competed like-to-like on advertising, we used other means like analyst relations, PR, events etc to promote our brands.

People have asked me at what point a company stops being an upstart. It’s either when your growth rate slows (and you become a laggard or a niche player) or your now sizeable marketshare makes you a leader. But, and this is important, do you have to stop thinking like an upstart? Actually, yes. Because a company defending marketshare has to act differently from one that is busy grabbing growth. For example, a leader has to erect barriers to protect its turf. An upstart is usually good at tearing down barriers or finding a way around them. So I think that making the strategy transition from upstart to leader is a big inflexion point in the history of a firm, and can determine its future. How to stay hungry but play like the fat cat is an art.

And what about marketing? Does that need to change too? Can’t we just use those great frugal techniques that made us big? There’s this book by Marshall Goldsmith called “What got you here won’t get you there”. That’s about people, but it’s true for brands too. The frugal techniques are as valid as ever, but if you’re a big brand, you probably sell to more people, so you have to do more of whatever you did. And at a certain tipping point you may have to make the transition from one media to another because you need reach. For example, while PR may have been adequate from an awareness perspective on the way up, as a big brand you may have to invest in advertising to ensure adequate reach and frequency. Of course, if you can do it more frugally than your competition, that’s an entry barrier in itself.

I borrowed the cartoon from Tom Fishburne’s post on a similar topic, and thanks to @rahulnambiar for pointing me to this cool blog.

17 comments:

zeno said...

When they start thinking like an upstart and start erecting barriers,they start living in their very world far away from market realities,taking their first giant step on the way to become dinosours!
Jus my humble opinion, though the argument is quite convincing, especially w.r.t marketing.

Jessie Paul said...

Zeno: all companies like to erect barriers - legal ones like IP, customer loyalty etc! Dinosaurs are created when they stop innovating

ADiwise said...

Nice one and i m sure it wud be an interesting read on david hitting goliath but would have been great to have insights on the other way round!

May be on how Wipro's marketing will survive the pressure from David's from Cognizants :)

Eager to read the book!

uma said...

Interesting thoughts...I wonder how smaller organizations can understand where their tipping point is.

Looking forward to reading the book!

Prats said...

I agree to what you say and specially abt ur stint in the Infosys & Wipro.

But interestingly as you say that there needs to be a tectonic shift in the way the brands are being marketed.

If you really look at both the brands,they are built on as NRN "The People are the most important assets". The reality is in the competition to fuel more growth the value of the brands are diluted. They are struggling for getting top slots in the premier institutions, the smaller companies are out-paying the resources ripping off good people.

Might seem very simplistic but in a long run this would have an impact on the quality of the delivery.

On the other hand, IBM still has the tag of Best Places to Work....

The transition would be really amazing to watch how these not so Goliath will fight the actual Goliath.

I know this is not the exact marketing we are talking about, but this aspect of the IT business is the core and has a direct impact on the clients (So I would like to classify this as marketing too)

Jessie Paul said...

ADIwise - you've given me the idea for my next book :)

Uma: tipping point is when your growth starts slowing - you have to figure out if it is because you have a large marketshare (good) or because you have lost your USP (bad)

ADiwise said...

Awesome! So pass on some of the royalty if it becomes a hit!

Jessie Paul said...

Adiwise - first please help me make my current book a hit :) otherwise there won't be a second!

ADiwise said...

A suggestion...why dont u go and do some "story book" sessions in MBA colleges. I remember we had Abhijit Bhaduri coming to our class around 3 yrs back and did one such session on Mediocre but arrogant!.... one got a wider audience in our class two many amongst us wrote and spread the word!

Arun said...
This comment has been removed by the author.
Arun said...

Interesting!!! Tipping point is when media (or your fans) start following you (the company). When you are small you chase media to write about you. Once you become big or innovative, media/ advertisers (which might include other bloggers) start following every step of urs

Ved said...

Hi Jessie,

It would be great to know about your inspiration and journey while writing this book.It would be nice to know the thoughts that came up while you wrote and maybe got dropped from the book in some cases ?

Subbu said...

I agree with you that while one 'graduates' from being an upstart to the big league, they should also graduate in their marketing approach. However, one should never lose the nimbleness and the 'tricks' one learned while one was an upstart. The analogy that comes to my mind is that of moving up from biking to driving a car. You cannot and should not forget biking.

Size also comes with its baggage and therefore a nimble mind can help overcome it effectively. In a completely different context(not marketing), this post by Robert Scoble (http://bit.ly/QuUGD) might give you some thought to mull over as to the dangers of size.

ayan said...

Nice article and looking forward to the book. My two penny here: just erecting barriers is an invitation to have the barrier broken by the next David. The challenge is to keep raising the barrier so it always stays out of reach for others. The best example I can think of is Google.

karthik said...

There is clearly a lot desired to be done by Indian IT firms in terms of marketing their brand. for instance the "Stop talking, start doing" and "building a smarter planet" campaigns of IBM establishes it among the audience as an innovating and smart solution provider. Brand marketing is a great tool to attract good talent to human resource intensive organizations such as Wipro and Infosys. Infosys I would say has done a better job in building a brand around its founders and NRN has given it the much needed publicity whereas Wipro is yet to define a strategy to market itself as a brand. Just my two cents.

RaAn said...

Hi!

Would like to point out a book on similar lines - Fast Second.A fast second company lets other companies innovate and experiment to create new markets. Then the fast second enters the market just as the dominant design is about to emerge, helps create the dominant design, and uses its size to capture the market.
Leaders can't be focused on building barriers but extending their leadership. Guess, every marketing tool, viz., PR, advertising, DM should be in synch to communicate leadership and how the company is continuously working towards extending the same. Case in point is IBM's 'Smarter Planet' initiative. The company seems to be leveraging PR and advertising effectively.
While Indian companies have been successful in 'colonizing' the market for offshoring, the competence required to play the 'consolidation' game will be very different. Looking fwd to reading your book.

kiran said...

Hi Jessie
indeed ur blog gives great insight to the marketting world...
we need to showcase how to outsmart others....