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In a slowdown most companies tighten their belts, encourage cost cutting initiatives and strive to improve their internal efficiencies. But a paper released at the CII Marketing Summit in Mumbai by consulting major, McKinsey & Company says that an organisation’s Sales & Marketing lever has between 50-60 per cent EBITDA potential as compared to its manufacturing and procurement levers and could successfully help organisations to successfully navigate a slowdown.
The paper “Market beating performance in uncertain times” says that a careful alignment of strategy with the fast growing segments, solid key account management, and increasing sales productivity were potential keys to success in a B2B setup. Similarly, several opportunities to grow in a B2C setup existed by making changes in go-to-market strategy. The new thinking on measuring Sales & Marketing RoI, states Vikash Daga, Partner, McKinsey, are made up primarily of two components; profitability and productivity.
The paper outlined clear areas for improvement for Indian companies in the marketing and sales functions for consumer facing businesses in comparison to the global best-in-class organisations. Consumer insights, brand strategy and on-shelf-availability of products emerged as three clear gaps where Indian companies could make a difference. For example, a dipstick survey of more than 100 traditional retail formats across Mumbai and Delhi showed significant variations in the on-shelf-availability of several leading brands.
The consulting organisation has identified that organisations need to have 8 capabilities and 4 enablers to be a Sales & Marketing success from strategic marketing initiatives to external channel partner management for B2B businesses and consumer insights to on shelf availability for the B2C segment (that McKinsey calls (B2B2C).
The purpose of the CII Marketing Summit is to deliberate on the challenges facing businesses resulting from market globalisation, rapid technological development and competition in the digital world.
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