Govt. in business suits?

By Cheranka Mendis

Why should a government adopt marketing strategies and does a government even need to outfit itself in business suits? The answer is yes, says world’s marketing guru Professor Philip Kotler.

Governments, contrary to what many may think, should behave more like a business – maybe not a profit making one, but one that is customer driven and citizen centric, he asserted.

Addressing the gathering of 200 participants which included ministers and senior sector officials along with private sector marketers at the Public Sector Marketing Forum conducted by SLIM at Waters Edge on Saturday, Prof. Kotler asserted that governments should behave like a business, driving forth improvements in the missions of the government agencies, quality with total quality management, increase productivity and innovate to find new solutions to problems and services.

Governments, which he acknowledged were the slowest to adapt to the concept of marketing, must be businesslike in their approach to achieving objectives.

This way they could “address issues, develop better programmes, set prices that would help citizens, improve distribution channels, maintain development identity and country’s identity and maintain the identity of each agency.

This mindset will bring forth benefits to all parties involved,” he said.

In a businesslike approach the governments will be able to able and solve people’s issues with regard to the State sector.

Governments do make mistakes, Kotler noted, pointing out that oftentimes the mistakes are made due to the lack of marketing research and education on the part of the government to test things before mass production.

Drawing examples, Kotler posed the printing of the one dollar coin in the USA, which was a failure as the cash registers did not have an extra drawer to put the coin and therefore refused to accept it. The same goes for the two dollar bill printed later on.

Kotler noted that if the governments used what is known as the ‘4P framework’ in marketing – concentration on product, price, place, and promotion – such mistakes could be avoided in the long run.

“For example, the public health insurance plan – someone has to come up with an insurance plan; that is a product. Then how much should be charged for seat belt violation; that is a pricing concern. How many libraries do we need and where should they be located; that is a distribution problem. The best way to convince teenagers to resist smoking? That is a promotion problem,” he stated. “As such it is key to remember that the 4Ps can be used very well for government sector operations.”

There are four spheres in the area of public sector marketing, Kotler announced: Product marketing, service marketing, social marketing and place marketing.

“In the case of the US Post Office system, it was hurt by not having proper customer orientating.” Along came FedEx and the system had to pull its weight. “They did recover afterwards and now provide a host of activities as packaging, bubble wrap, etc. Post offices have been reinvented as a result of competition.”

In fact the problem with many government agencies is that they do not have competition, Kotler noted, “There is no competition for the Employment Bureau or the License Bureau. So why get better?” he questioned.

In the service marketing category, the Professor spoke of how Fire Departments and Police Departments can be empowered to help people in many more ways with the help of a guided mission statement, manual training and proper marketing.

The main area of concentration is on social marketing. “How do you get people to do things that are good for them, such as saying no to drugs, eating healthy, exercising and so on? How do you market an idea? That is what social marketing is,” he asserted.

“It should not just be an idea in the head but a change of behaviour. A lot of things make up social marketing besides traditional marketing – it’s a mixture of education, economics, getting laws to be passed that would facilitate this and using technology.”

Even the best, however, has issues. Do you promote abstinence or birth control when it comes to young people and sexual behaviour? Is the solution for air pollution carpooling or mass transport? How do you stop cigarette smoking – by creating fear in the minds of the people or with an approach of love? Marketing plays its role here. Research and approach, Kotler advised, adding, “It evolves through stages.”

The area of ‘place marketing’ is perhaps the most important to Sri Lanka at present as the country is gearing for nation branding and getting more tourists and investors to come into the country.

“It is about how we attract people to a place. How do we get talented people, factories and major officers to come here? Government organisations need to run campaigns to do just that.”

The criteria for a successful campaign as listed by Kotler includes high incidents of adaptation, high speed of adaptation, high continuance of adaptation and high cost per unit of adaptation.

“Marketing is a new subject, whereas sales is an old subject. Sales goes way back to Adam and Eve where we blame the snake for convincing Eve to get Adam to eat the apple. Marketing itself is a much larger concept than sales and did not appear till 1910 to 1915,” Kotler said.

“It’s a discipline that is less than 100 years old. It was first used in the consumer goods industry and then moved to business-to-business industry or industrial marketing. When I started thinking about these applications, I realised it also applies beyond normal industries to non profit organisations. Organisations such as museums will always have to attract people; marketing performing arts like theatre groups and orchestras can help them find an audience. In the case of health organisations, it can get people to live a healthier life.”

“It took some convincing to show Non Profit Organisations (NPOs) that marketing can be useful to them besides industrial marketers. It wasn’t easy in the sense that a lot of people who were running NPOs were doing it because they wanted to do good and many were anti-commercial – in other words, ‘what has business got to do with NPO, what has marketing got to do with NPO?” The same mindset existed in the government organisations. Therefore, when it comes to marketing, the government sector is a late bloomer.”

Answering a question on how the roles of government and public sector operate in that context, Kotler stated that the distinction between outputs and outcomes was an important one. “Sometimes governments say ‘here’s our output,’ but I like the word ‘outcome’. It’s more diametric. Sometimes output is more of what you did as activity but not how much it helped.”

“The basic question in our nations is, ‘what is the purpose of society?’ We used to think it was to increase GDP; if it goes up we are better off. A new study of happiness shows that when income reaches a certain level, it doesn’t prove your happiness but beyond that you will be happier, so society is trying to get people up to a decent level.”

He acknowledged that it was interesting that Buddhism, which is practised by the majority in the country, mentions that one way to be happier is by decreasing your needs. “Marketing is a funny thing; it needs you to spend, to buy things, and it gives a new reason for wants. We get spoilt that way. What must be practised is sensible consumption or adapting to a ‘sufficiency principle’ as Thailand did.”

On tourism, logos and taglines, Kotler stated that the idea of a slogan in promotion was a marketing plan. “Every Asian country has a slogan so marketing cannot be done only through a slogan. Ask yourself what people you want to attract here. You don’t want the whole world coming here; you won’t be able to accommodate them. Ask yourself if its mass tourism or class tourism you want. When its class tourism, find out where these people are, tourists who would savour the quality of the country,” Kotler said.

“Target the group, find the people and segment it, and plan on how to get the turn with other players such as Maldives in the same region. Attract the influential; the high network of people whose behaviour is watched by others.”

Stating that Lady Gaga was coming to India, he advised the hierarchy present at the event to get someone like Julia Roberts to come to Sri Lanka and do a movie on romance. Hong Kong did the same 10 to 15 years ago and people fell in love with the destination, he said.

“Think about marketing Sri Lanka as a national project; ask the citizens and you will get a whole lot of clever ideas.” It is about clever integration between citizens, marketing and government, he emphasised.

“My only thesis is that the public sector is very important and it is even important to have a good partnership between business, government and non profit organisations. These things can be accomplished better together. Marketing is a useful skill set in not just commercial, but in government and non profit organisations.”

Central Bank Governor Ajith Nivard Cabral, who was part of the panel at the Public Sector Marketing Forum, stated that Sri Lanka and the CBSL also uses marketing to promote good economic principles.

“Sometimes you may think CBSL is a monetary organisation which doesn’t need to market, but we do and one way is inflation,” Cabral said.

“The main portion of inflation is driven by inflation expectation. If people feel the prices are going to go up in the short term or the long term, they will take certain steps in order to face it. So for us it’s important that we structure ourselves to indicate the situation to the people. In communicating our strategy about reducing inflation, it helps reduce inflation expectancy, which in turn helps us reduce the pressure on inflation. That cycle is an important one to remember,” Cabral said.

Moving on to branding, Cabral commented that many people had queried why Sri Lanka wanted to host the Commonwealth Games in Hambantota. The need to change image is the top concern and priority, he said.

“Sri Lanka was known for a very long time for a conflict and now needs to shed the olden day baggage of conflict and connect it with something more exciting and with something that’s relevant to the rest of the world. The Commonwealth Games in Sri Lanka would make an extraordinary difference,” he asserted.

Quoting from Dr. Mahathir Mohamed’s book ‘Doctor in the House,’ Cabral stated that the reason for Malaysia to host the same games some time back was because Mahathir wanted to change people’s perspectives.

“In his book Dr. Mahathir said it was ‘particularly because I want to show people we don’t live on trees any longer’. He wanted to replace a certain impression people had about Malaysia with a different strategy. They sent a strong message. We want to send a message not necessarily in a direct manner but indirectly.”

Kotler coins “So Lovely” for SL

After being mesmerised with a visit to Sigiriya, marketing guru Dr. Philip Kotler yesterday quipped the acronym for SL in Sri Lanka should mean “So Lovely.” Kotler had been captivated by Sri Lanka's warmth and smile. He also said that there were many countries striving for the green and eco tourism label, but Sri Lanka truly deserved to be called a green destination. “It is probably one of the best locations for eco tourism,” Kotler told Sri Lanka Tourism officials after taking a flight to visit Sigiriya, where he spent several hours mixing with the community and officials.