In this new book, traditional marketing approaches such as branding, customer research and competitive strategy are discarded in favour of a radical new concept: weaving a business into the fabric of society. Performance is measured by the extent to which a company addresses social values and lifestyles. INSEAD professor Charles Waldman and co-author Jean-Claude Thoenig shift more than a few paradigms in The Marking Enterprise. 'Branding' is replaced by 'marking', 'markets' by 'territories' and 'needs' by 'cognitions'. The 'marking' of the title is demonstrated through the book's main examples: Royal Canin and Walmart. Royal Canin became an outstanding performer in the pet food industry by doing everything differently from its competitors. Adopting animal health as its raison d'être and retailing exclusively through veterinary clinics and specialist outlets, it marked out a brand new territory. The product itself was innovative but, more importantly, Royal Canin was revolutionary in defining and targeting a new group of stakeholders, comprising dogs, dog-owners, vets, breeders and researchers. It is this radical approach that reshapes segments of society in the company's own image that the authors term 'proactive marking'. Walmart, by contrast, did not invent a new retail concept. Rather, founder Sam Walton spotted an opportunity to operate discount stores in an entirely new territory: small-town America. Having identified his customers he proceeded to embed his company in society by turning staff into vital stakeholders, a process the authors describe as 'reactive marking' - less iconoclastic and exciting than proactive marking, but nonetheless embedding the company in society as a whole. What both companies had in common is that they responded to society's trends and thus 'marked' their territories. Whether proactive or reactive, marking can best be described as a moral contract and a pragmatic commitment that a company builds with regard to its stakeholders. The legitimacy of that relationship has to be reinforced in all their interactions. Thoenig and Waldman present a number of other examples of firms that have made their mark on society including Club Med, Benetton, Dyson, Ikea and Tesco. The company that truly leaves a mark is always going to be difficult to create, whether built from scratch or refashioned from an underachieving business. The belief it requires cannot be conjured from thin air, nor can the moral contract with stakeholders. Moreover, once that contract exists, a highly disciplined approach will be needed if companies are not to betray it. The book is as much about strategy and organisational structure as marketing. The concept of the marking enterprise effectively broadens executives' minds and is thus a valuable teaching tool.
