Results tagged “strategy” from The Emory Marketing Institute Blog

Logically, strategy must precede metrics.

However, in many companies, metrics develop a life of their own and begin to dictate strategy.

Because of reward and incentive systems based on key performance metrics, managers all too often manage metrics such as ROMI rather than managing the business. For example, when profits or returns are limited under adverse economic conditions, companies often cut back on marketing investments in order to produce acceptable performance (ROMI’s). Ironically, for strong companies, this may be the best time to go on an offensive because less robust competitors may be weaker still.

Using the same metrics to both measure past performance and to resource the future can have disastrous results:

• The best way to kill new product innovations that have long-run payoffs is to use short-term, backward-looking metrics such as margins, turnover and return on assets that favor incumbent products thus starving innovations of badly need growth funds.
• Blurred insights can lead to questionable decisions. For example, higher short-run sales response elasticity for price-promotions has led to a systematic decrease in the share of marketing mix budgets allocated to advertising in the long run.
• Because marketing activities are listed as expenses rather than investments, they must typically “pay” for themselves within a year. Ironically, market-based assets such as customers and brands are the only assets that appreciate, and not depreciate.

If strategy is to precede metrics, knowledge of the competitive environment and company objectives must precede strategy development. Short-cycle environments require fast-cycle capabilities such as flexibility and agility. Product-markets where customer benefits are more intangible (e.g., fashion and branded goods) require different types of support.

I always warn my clients that taking a half-baked product to market will actually do more damage than good. Now let's see if the same applies to nation-branding.

The Olympics will focus the media spotlight on China. But will China actually enjoy the focus? Will the Olympics help or hurt brand China?

The hurt has already begun.

In a New York Times article "As China Roars, Pollution Reaches Deadly Extremes",  Joseph Kahn and Jim Yardley tell us that "Environmental degradation is now so severe, with such stark domestic and international repercussions, that pollution poses not only a major long-term burden on the Chinese public but also an acute political challenge to the ruling Communist Party."

Apparently the government has banned publication of data on the subject for "fear of inciting social unrest."

But the Kahn and Yardley give us some data nevertheless:

- An internal, unpublicized report by the Chinese Academy of Environmental Planning in 2003 estimated that 300,000 people die each year from ambient air pollution, mostly of heart disease and lung cancer. An additional 110,000 deaths could be attributed to indoor air pollution caused by poorly ventilated coal and wood stoves or toxic fumes from shoddy construction materials, said a person involved in that study.

- Another report, prepared in 2005 by Chinese environmental experts, estimated that annual premature deaths attributable to outdoor air pollution were likely to reach 380,000 in 2010 and 550,000 in 2020.

and:

- A World Bank study done with SEPA, the national environmental agency, concluded that outdoor air pollution was already causing 350,000 to 400,000 premature deaths a year. Indoor pollution contributed to the deaths of an additional 300,000 people, while 60,000 died from diarrhea, bladder and stomach cancer and other diseases that can be caused by water-borne pollution.

Wait, there's more.

An official study to estimate the environmental cost of China's runaway economic growth was shut down prematurely.

Greenwashing, apparently, is in. Here's an absurd story to drive the point home: "Villagers in southwestern China are scratching their heads after an estimated more than $60,000 was spent to paint an entire barren mountainside green."

Whoo-hoo.

Smog from China is contributing to bad air quality and possibly even affecting the climate in parts of the western United States. The Telegraph also reports: "Almost a third of the air over Los Angeles and San Francisco can be traced directly to Asia..."

And now, to make things worse, they're probably going to beat up the Chinese enviromentalists who dare to speak up. Again from NYTimes:

"At least two leading environmental organizers have been prosecuted in recent weeks, and several others have received sharp warnings to tone down their criticism of local officials. One reason the authorities have cited: the need for social stability before the 2008 Olympics, once viewed as an opportunity for China to improve the environment."

Ouch.

Nation Branding 101: Embrace reality.

Welcome to the Emory Marketing Institute's blog - where we focus on the intersection of branding practices and business performance.

Our goal is to start meaningful conversations around a few topics of interest to us:

- Branding History
- Benefits of Branding
- Brand Strategy
- Resource Allocation
- Brand Lifecycle Management
- Marketing Programs
- Operations Management and Branding
- Brand Strength Assessment
- Brand Performance
- Brand Valuation
- Business to Consumer Branding
- Business to Business Branding
- Technology Branding
- Services Branding
- Branding Case Studies
- Branding Best/Worst Practices
- Private Label Competition
- Branding Commodities
- Branding in Emerging Markets
- Branding Retail Organizations

We invite you to participate, to contribute - ideas, suggestion, comments and insights. Join us in our learning journey...