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Foreword by Rajiv Dutta

Former President of eBay marketplaces, Skype, and PayPal 

Executive in Residence at the Peter F. Drucker and Masatoshi Ito Graduate School of Management 

We Live in Interesting Times

Cycle compression is evident all around us. Digital technology and mass media have forever changed the average length of major events: events that would have spanned decades in past centuries play out in years, or even months in our time. In his path breaking book, “The Singularity” futurologist Ray Kurzweil refers to the inability of the human brain to comprehend a constant rate of change…the times we live in are only set to become even more interesting.

Witness the current recession, already the deepest since the Great one. Emerging from the depths of this recession there is a good chance that global consumers will never behave in the same credit-crazed, free-spending ways again. Or will they? Or will the old behavior morph into something new? What lies ahead? What other shocks await our global, interconnected markets that impact lives of farmers in India and traders in New York with breathtaking synchronicity.

Against this backdrop, the hapless CEO is desperately trying to make three, five and even ten year bets of resource allocation, whilst fielding the intense scrutiny of customers, employees and shareholders. Leading an organization during such trying times is, to put it mildly, challenging. Uncertainty often encourages risk aversion, which in turn leads to analysis-paralysis and organizational rigor mortis. But today’s environment also offers a unique opportunity to leap ahead of the competition by embracing the new world order and managing with, rather than against, change.

Zig when they Zag

Marketing Through Turbulent Times is a timely book.  Jenny Darroch provides an excellent overview of the current economic times and links together the disparate themes of recession, democracy and individual depression and explores the role of social media and democracy. The recent fall-out from the election in Iran is only one compelling example of social media giving newfound power to the commons. 

We know that social media is here to stay. We also know that social media has already substantially altered the way in which we communicate.  The challenge for CEOs and marketing managers today is to embrace this technology and, instead of ignoring technology that might be hard to fully understand, embrace it and become leaders in the formation of best practices. Rather than allowing the current economic times to become an excuse for inactivity, Marketing Through Turbulent Times aims to provide a roadmap for leaders wanting to grow their organization or start new ventures.

Embracing and enabling change is certainly consistent with for “high-tech” companies such as Google, eBay, Skype, PayPal, but it also applies to companies in more established industries. No corner of the industrial landscape will remain untouched by the forces of this change. 

Good Luck Beats Good Strategy

The traditional approach to managing change has often involved building detailed scenarios of the future and planning for alternative scenarios and understanding sensitivities. However, this approach is fraught with issues. To quote Yogi Berra, it is tough to make predictions…especially about the future! Luck beats strategy any day. A far better approach is to maximize your chances of luck. Execute against a variety of promising avenues. Open the company to information from outside. Stay close to start up’s in your industry. Delete the word “cannibalization” from your corporate vocabulary. If you don’t cannibalize yourself, someone else will. Any singular strategy that is built on a singular world-view of the future is highly likely to fail.

Lessons from the World’s Marketplace

Drawing from my own background, apart from its obvious success, eBay also provides an excellent example of a healthy and functioning market that I believe has had a profound impact on the way consumers expect to be treated when doing business with any organization. With eBay, buyers have access to good information about the items they want to purchase and buyers only pay what they believe an item is worth. Sellers learn to communicate the value proposition of their items in a way that meets the needs of their target market. To be successful, sellers need to receive good feedback, and good feedback requires sellers to be customer focused. Marketing Through Turbulent Times addresses these issues in the section covering growth through excellent execution of the current marketing strategy.

Further, by acquiring PayPal, eBay changed the nature of its business, which ultimately begs the question of “What business are you in?” Is diversification something to fear? No, not at all.  What is important is to recognize the dynamic nature of business and therefore be willing to adapt as the organization evolves.

Lessons from Drucker

Jenny Darroch encourages us to look at the business through customers’ eyes and to understand the needs customers seek to satisfy when using a product or service. As a former student of Peter Drucker, I am sure that he would have approved. It is easy to forget about the customers’ perspective when we are faced with substantive economic challenges but Jenny Darroch reminds us that during such difficult times, it is perhaps even more important to remember that customers are the reason you are in business.

Marketing Through Turbulent Times provides a roadmap for leaders who want to generate growth through excellent execution of the current marketing strategy while also adopting a more disciplined approach to creating growth by identifying problems and solutions. While Jenny Darroch was motivated to write Marketing Through Turbulent Times in response to the current recession, I believe the ideas contained within the book are enduring.

July 31, 2009

Source: Darroch, Jenny (2010). Marketing through Turbulent Times, Palgrave Macmillan. Reproduced with the permission of Palgrave Macmillan. 

See also: http://us.macmillan.com/marketingthroughturbulenttimes and http://www.palgrave.com/products/title.aspx?PID=376971