Changing business and marketing trends

A recent book entitled Beyond Disruption praises companies such as Apple, Sony, and TAG Heuer for achieving exponential sales growth despite being established but stagnant, markets. The explanation offered for these success stories was that these companies adopted a clear vision of the proper direction in which to take their brands and challenged marketing convention through product innovation, advertising, or some other aspect of marketing. Another recent book entitled Radical Marketing spotlights companies such as Harley-Davidson, Virgin Atlantic Airways, and Boston Beer for adopting a different approach to marketing that focuses on stretching limited resources, staying in close contact with customers, and creating more satisfying solutions to customer needs.

We can say with some confidence that “the marketing isn’t what it used to be.� It is radically different as a result of major, sometimes interlinking societal forces that have created new behaviors, new opportunities, and new challenges.


Many countries have deregulated industries to create greater competition and growth opportunities. In the United States, long-distance telephone companies can now compete in local markets and local phone companies can now offer long distance. Similarly, electrical utilities can now enter local markets.

Heightened competition

Brand manufacturers are facing intense competition from domestic and foreign brands, which is resulting in rising promotion costs and shrinking profit margins. They are being further buffeted by powerful retailers who command limited shelf space and are putting out their own store brands in competition with national brands.

Customer empowerment

Customers increasingly expect higher quality and service and some customization. They are more and more time-starved and want more convenience. They perceive fewer real product differences and show less brand loyalty. They can obtain extensive product information from the Internet and other sources, which permit them to shop more intelligently. They are showing greater sensitivity in their search for value.


Many countries have converted public companies to private ownership and management to increase their efficiency, such as British Airways and British Telecom in the United Kingdom.


The company is able to produce individually differentiated goods whether ordered in person, on the phone, or online. By going online, companies essentially enable consumers to design there own goods. The company also has a capacity to interact with each customer personally, to personalize messages, services, and the relationship. Using smart software and new manufacturing equipment, catalog house Lands’ End put customized chinos up for sale in 2001 and is now expanding its number of customized products. Because items are cut to order, the company doesn’t have to keep as much inventory around.

Industry convergence

Industries boundaries are blurring at an incredible rate as companies are recognizing the new opportunities lie at the intersection of two or more industries. Pharmaceutical research companies once believed to be chemical companies are now adding formulation of new drugs, new cosmetics, and new foods.
Shiseido, the Japanese cosmetics firm, now markets a portfolio of dermatology drugs. Christmas 2003 saw the convergence of the computing and consumer electronics industries as the giants of the computer world such as Dell, Gateway, and Hewlett-Packard released a stream of entertainment devices—from MP3 players to plasma TVs and cam corders. The shift to digital technology, in which devices needed to play entertainment content are more and more like PCs, is fueling this massive convergence.


Technological advances in transportation, shipping, and communication have made it easier for companies to market in other countries and easier for consumers to buy products and services from marketers in other countries.

Retail transformation

Small retailers are succumbing to the growing power of giant retailers and “category killers.� Store based retailers are facing growing competition from catalog houses; direct mail firms, newspaper, magazine, and TV direct-to-customer ads, home shopping TV, and e-commerce on the Internet . In response, entrepreneurial retailers are building entertainment into stores with coffee bars, lectures, demonstrations, and performances. They are marketing an “experience� rather than a product assortment.

Changing technology

The digital revolution has created an Information Age. The Industrial Age was characterized by mass production and mass consumption, stores stuffed with inventory, ads everywhere, and rampant discounting. The Information Age promises to lead to more accurate levels of production, more targeted communications and more relevant pricing. Moreover, much of today’s business is carried on over electronic networks: intranet, extranets, and the Internet.


The amazing success of early online dot coms such as AOL, Amazon, Yahoo, e-bay, E’TRADE, and dozens of others who created disintermediation in the delivery of products and services struck terror in the hearts of many established manufacturers and retailers. In response to disintermediation, many traditional companies engaged in re-intermediation and became “brick-and-click,� adding online services to their existing offerings. Many brick-and-click competitors became stronger contenders than the pure-click firms, since they had a larger pool of resources to work with and well-established brand names.