Marketing Is Everything

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HER
JANUARY-FEBRUARY 1991

Marketing
Is Everything
by Regis McKenna

he 1990s will belong to the customer. And that is great news for the marketer. Technology is transforming choice, and choice is transforming the marketplace. As a result, we are witnessing the emergence of a new marketing paradigm - not a "do more" marketing that simply turns up the volume on the sales spiels of the past but a knowledge- and experience-based marketing that represents tbe once-and-for-all death of the salesman. Marketing's transformation is driven by tbe enormous power and ubiquitous spread of tecbnology. So pervasive is technology today tbat it is virtually meaningless to make distinctions between technology and nontecbnology businesses and industries: tbere arc only tecbnology companies. Tecbnology has moved into products, the workplace, and the marketplace with astonishing speed and thorougbness. Seventy years after tbey were invented, fractional borsepower motors are in some IS to 20 bousebold products in tbe average American home today. In less than 20 years, the microprocessor has achieved a similar penetration. TWenty years ago, there Regis McKenna is chairman of Regis McKenna Inc., a Palo Alto-headquartered marketing consulting firm that advises some of America's leading high-tech companies. He is also a general partner of Kleiner Perkins Caufield &) Byers, a technology venture-capital company. He is the author of Who's Afraid of Big Blue? (Addison-Wesley, 1989) and The Regis Touch (Addison-Wesley, 1985]. DRAWING BY TIMOTHY BLECK

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MARKETING IS EVERYTHING

were fewer than 50,000 computers in use,- today more than .50,000 computers are purchased every day. The defining characteristic of this new technological push is programmahility. In a computer chip, programmability means the capability to alter a command, so that one chip can perform a variety of prescribed functions and produce a variety of prescribed outcomes. On the factory floor, programmability transforms the production operation, enabling one machine to produce a wide variety of models and products. More broadly, programmability is the new corporate capability to produce more and more varieties and choices for customers - even to offer each individual customer the chance to design and implement the "program" that will yield the precise product, service, or variety that is right for him or her. The technological promise of programmahility has exploded into the reality of almost unlimited choice. Take the world of drugstores and supermarkets. According to Gorman's New Product News, which tracks new product introductions in these two eonsumer-products arenas, between 1985 and 1989 the number of new products grew by an astonishing 60% to an all-time annual high of 12,055. As venerable a brand as Tide illustrates this multiplication of brand variety. In 1946, Procter & Gamble introduced the laundry detergent, the first ever. For 38 years, one version of Tide served the entire market. Then, in the mid-1980s, Procter & Gamble began to bring out a succession of new Tides: Unscented Tide and Liquid Tide in 1984, Tide with Bleach in 1988, and the concentrated Ultra Tide in 1990. To some marketers, the creation of almost unlimited customer choice represents a threat - particularly when choice is accompanied by new competitors. TVenty years ago, IBM had only 20 competitors,- today it faces more than 5,000, when you count any company that is in the "computer" business. Twenty years ago, there were fewer than 90 semiconductor companies; today there are almost 300 in the United States alone. And not only are the competitors new, bringing with them new products and new strategies, but the customers also are new: 90% of the people who used a computer in 1990 were not using one in 1980. These new customers don't know ahout the old rules, the old understandings, or the old ways of doing business - and they don't care. What they do care about is a company that is willing...
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