In Focus Interview
Jeffrey Carr, 47, was in Warsaw last month to lead a strategic marketing seminar. The visit wasn't the first for the American marketing guru, who in recent years has appeared at two marketing seminars for McCann Erickson Worldwide's Polish operations. Carr is president of the New York-based Carr & Associates, a 15-year-old marketing training firm and consultancy. Apart from running his own business, Carr is an associate professor in the MBA program at New York University's Stern School of Business. He has designed, developed and conducted customized marketing training programs and consulting projects on strategic marketing, brand management, competitor analysis, pricing, distribution management and integrated marketing communications in the U.K., Europe, Asia, Africa and the United States. Carr talked to the WBJ's Justyna Wrobel about the marketing world and Poland's burgeoning industry. The following is an edited version of their conversation.
Q: Your Global Marketing Game (GMG), or computer-based marketing simulation game, is perhaps the best-known aspect of your seminar. How did you come up with the idea of a simulated game to teach marketing?
A: Marketing is very logical and clear in theory. However, in reality it is a dirty, ugly, never-ending process. We have found that simulation games work extremely well when teaching and training executives. It allows them to apply and practice the theories and concepts they learn in class in a very dynamic and fun way not like sitting in a university classroom. We split the participants into teams that market a global ice-cream company. They make decisions on product research and development, brand positioning, market research, distribution, pricing, communication and resource allocation all sorts of classic marketing problems.
There are two core benefits to the simulation. First, we compress the entire process, so unlike in the real world where you have to wait six months or a year to see what the effects are, you get to see the results of your marketing strategies an hour later. Second, the participants are in a safe environment. The only thing they may lose is a little bit of pride. It is also a hell of a lot of fun. (In addition), participants have an opportunity to see the big picture. They (gain) perspective in marketing, instead of the much narrower roles they usually play. For ad agencies, they have a chance to better understand how their clients operate on a daily basis. For marketing managers, communication activities are often not a major part of what they do. On the other hand, for the agencies, it's everything. They must realize that there is a whole world of business out there they have to fit into if they want to keep their clients.
Q: How relevant is GMG to marketing environments outside the United States?
A: The two clients we developed the game for generate more than 60% of their revenue outside the U.S. so they have a very international perspective. That is one of the reasons it is called the 'Global Marketing Game.' Most of the work we have done has been in international markets.
Q: Generally speaking, how do Polish marketing managers differ from their American counterparts?
A: A typical American manager in the course of (his or her) career will work for several companies, often in various industries. (Because of that) they receive a real cross-pollination of ideas. U.S. companies are typically more concerned that their managers have a real skill, whether it is in finance, marketing or management. Industry knowledge is less important because there are always industry experts around. Here in Poland things seem a little more narrowly focused, so Polish managers know a lot about the industries they are in, but they don't seem to have quite as broad a perspective. But then, how long has there been a free-market economy here? Things take time to develop. The U.S. has had a long time to practice.
Q: What makes a marketing manager successful?
A: We have found what we think are four major roadblocks that prevent marketing managers from becoming successful. The first one is greed. Everyone wants to make a lot of money really quickly, but that is usually not the best marketing strategy. Marketing success comes over a long period of time by doing small things that add up to big things. Moving from one win to the next. Most people don't have the patience for that. The second one is politics. It is nearly impossible to sit in a meeting with the CEO of a company, who has managed it successfully for 20 years, who probably founded it and who created the original product, and tell him that the product isn't good anymore and should be eliminated. It might be the right marketing decision, but do you really think it will get that manager promoted? The third one is economics. Most companies are managed from an economic and financial perspective, and that means they focus on expenses. Marketing is not about spending a lot of money, but it is about spending money when it has to be spent. There is a very short-term profit orientation that says if you are not making your numbers this quarter, let's slash expenses. At the end of the day, this approach doesn't lead to long-term success. And the biggest one is ego. You can't do marketing alone. You don't get to sit around the table and say this is a great and wonderful product. That is not marketing. Marketing is about asking people what they want and then figuring out how to give it to them, for a profit.
Q: Any examples of how someone's ego can get in the way?
A: My first client fired me. We did a very big market research project a very good piece of research. We stood up and told the client exactly what they should do. And the president said: 'You're wrong, this is not what I want to hear.' So they fired us. I was really embarrassed and I thought I would never get another client. They did what the boss wanted and lost a great deal of money. It was all about ego who is right, not what is right.
Q: What are the hot trends in marketing right now?
A: Marketing managers used to have a really wonderful life creating beautiful ads, playing in the fun part of the business. It was more art than science. Marketing is still both art and science, but now the shift is toward the scientific. Today, it is increasingly difficult to get budgets approved if you can't prove your case. And proving your case in business today is a science. The language of business is finance here is the size of the market, here is the value of the market, here is what it is going to cost, here is what our competitors do. It's a process of putting together a logical argument. You have to be able to run the numbers. A second big trend, I would say, is in the communication part of the marketing mix. It is connected to the idea of proving your case. If you look at the whole mix of communication vehicles, more and more money today goes toward direct marketing or consumer relationship marketing because they have numbers to prove their cases, show returns and focus on sales. There is a scientific rigor around it. In public relations, for instance, without numbers to back them up, things that are really wonderful and valuable and absolutely do work are always at a disadvantage. The third trend is integrated marketing communications. Trying to tie together all of the communication vehicles to create a unified brand face. We see more and more companies trying to do this some more successfully than others.
Q: What is your overall impression of Poland's advertising market?
A: As I understand it, the ad market here has been going through quite a few changes because of the new laws, difficult economic situation of the country and consolidation in the advertising industry. (In general) the large ad agencies have a rather odd business model. The core reason they are in many countries is because their clients want them to be. When those companies leave or cut back due to poor economic conditions or poor sales, they usually blame the agencies. It is very difficult for agencies to maintain an infrastructure with offices around the world. It becomes even tougher when the demand from clients starts to soften and they either leave the market or shift to smaller agencies and creative boutiques. So you see a lot of the agencies shut down or merge.
Q: What does the Internet advertising market look like in the U.S. right now?
A: There used to be an enormous number of advertising agencies specializing in dotcoms. It is hard to find any now. They grew very, very quickly with revenue from the dotcoms and traditional advertisers who spent a lot of money on e-commerce advertising. That revenue stream has totally died out. Most of the budgets have gone back to the major agencies because they have the core support structure to do real advertising.
Q: Do you have any plans to open an office in Poland?
A: I have been to Poland three times in the past two years and I have met some people who think there would be enough demand here. They have been very encouraging. In the States there are many MBAs. They are very bright and experienced and it's very exciting. But at the end of the day, they don't actually need me very much, because they are quite good at what they do. In Poland, I think we could make a difference. Managers here have to move up the learning curve. If they are going to compete with the rest of the world they have to realize they are competing with people who already have a lot of skill, knowledge and experience. I am really looking forward to running a business here. We have a local partner in Poland: MCC-Marketing & Communications Consultants. Like everyone else we need help with the local marketplace. We need people who have contacts, speak the language and know the market. We see Poland as a great opportunity and definitely would like to expand to other countries like the Czech Republic or Hungary.
(Of course), there is always a risk in starting a new business, especially in a down economy, but we don't need a lot of clients for this to be a success. We will find a few companies that believe in the same things we do, and then we will slowly begin to grow. This is going to be fun. We really love what we do. I am looking forward to the ride.
