Profitability: Tensions in Marketing

Profitability is primarily about marketing. When there are difficulties these can often be traced back to a failure to properly understand the tensions in our minds as we seek profits. So that is where we must start. Once that is done we can turn to the specific marketing strategies and how they inter-relate within a single framework.

Businesses Interact for Benefit

Profitability in any business depends on its interactions with:

► customers via its products
► competitors
► markets.

ClosedMore on Markets

In pursuing these interactions, there are three sets of tensions whose effective handling determines profitability. The framework to be developed shows exactly how and where these tensions arise and how they must be handled.

All Spirals give rise to a holistic hierarchy.

The Spiral deals with situational context (culture, ethos or equivalent) that can develop through time, and the hierarchy deals with situational content (choices, activities, states or equivalent) that exists at any moment in time.

The sequence of Stages in the Spiral, 1 to 7, corresponds to the sequence of Levels, 1 to 7, in the derived hierarchy. In discovering and articulating Centres and Channels of any Tree from a hierarchy, it is necessary to be clear about three dualities.

  • The oscillating duality distinguishes the odd Levels (L1, L3, L5, L7) from the even Levels (L2, L4, L6). This tension flows from the hierarchy that emerges from the Spiral. It highlights stresses faced by company management in being utterly realistic about its markets, its customers and its competitors. If not handled well, then the other tensions (i.e. marketing in general) are unlikely to be managed effectively.
  • The dynamic duality provides for opposing poles (L3, L5, L6) and fused poles (L1, L2, L4, L7). This tension determines the nature of the Centres in the hierarchy and the Channels within a THEE Tree. In this case, the fully developed Tree will specify all possible marketing strategies.
    See it now.
  • The internal duality distinguishes the upper 3 «governing» Levels of the Tree from the lower 4 «activity» Levels. The polarization is resolved by appropriate use of Channels of influence. In this case, the duality differentiates two grand approaches to marketing which are linked in various ways.

    ClosedThe two approaches are:

    Note: New economy companies need heightened awareness of the latter approach.

Read more at the Hub.

Tension-1

Choices of the company in relation to marketing that are intrinsically under the control of the company versus those that demand adaptation by the company. In THEE:Closed the Oscillating Duality.

This tension is explained further here.

Tension-2 

Choices of the company in relation to marketing that are product-centric (i.e. derived from the nature and features of the product) versus those choices that are market-centric (i.e. derived from the nature and features of markets, customers and competitors). In THEE:Closed the Dynamic Duality.

This tension is explained further here.

Tension-3

Companies need both markets and customers. So serving the interests of markets/customers must be important to them. At the same time customers (and markets) have little concern or ability to care for the success of any particular business (exceptional circumstances aside). So companies must look after themselves. In this lies the third tension:

Choices of the company serving the interests of the company versus choices of the company serving the interests of the market. In THEE:Closed the Internal Duality.

This tension is explained further here.

Construction of the Framework

Once these tensions have been clarified, the framework for marketing can be developed in the form of a THEE Tree. All Centres and Channels potentially affect the profitability of any business. So top management of any firm should be aware of all the possibilities.

Originally posted: July 2009