Revenue Generation for Recovery

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					Revenue Generation
for Recovery
Using Marketing Principles to
Grow Our Way Out of Recession
This position paper has been developed as a management aid for
professional marketers and businesses in Northern Ireland and the                                                                                                   Revenue Generation
                                                                                                                                                                    for Recovery
Republic of Ireland in addressing the challenge of recession. It has
been developed by the following professional team appointed by The
Chartered Institute of Marketing:

Project Team:
                                                                                                                                                                    Using Marketing Principles to
                                                                                      Charles Fulton MCIM: Chair of CIM
                                                                                                                                                                    Grow Our Way Out of Recession
Dr Michael Johnston FCIM (Chair):
Chief Executive of the Dairy Council for                                              Ireland, Charles Fulton has broad based
Northern Ireland, Dr Johnston is a                                                    experience in marketing services in
professional marketer with a wealth of                                                Ireland and is Managing Director of
experience in international marketing.                                                Fulton Advertising.                                                           Index                                     Page
He was also former International Chair of                                             Richard Moore FCIM: Richard Moore
The Chartered Institute of Marketing.                                                 has had a distinguished career in Market                                      1.      Introduction                      2
Michael Maguire FCIM (Author):                                                        Research in Ireland and served for many
Michael Maguire has a track record in                                                 years as Managing Director of Millward
professional marketing in Europe and the                                              Brown Ulster.                                                                 2.      Background Analysis               3
UnitedStates and acts as Regional Director
                                                                                      CIM Ireland Board:
to CIM in Ireland.
                                                                                                                                                                    3.      Marketing Development Scenarios   6
Professor David Carson FCIM:                                                          Charles Fulton MCIM (Chair), Joy Bond MCIM,
President of CIM Ireland, Professor Carson
is a distinguished marketing academic and
                                                                                      Lee Campbell MCIM, Brian Cochrane MCIM,
                                                                                      Anne Doherty MCIM, John Edmund FCIM,                                          4.      Understanding Market Dynamics     8
author, and edits several leading                                                     Colin O’Neill MCIM, Dr Geoff Simmons MCIM,
marketing publications.                                                               Tracy Tsang MCIM
                                                                                                                                                                    5.      Conclusions & Implications
                                                                                                                                                                            on Revenue Generation             14

For further information on The Chartered Institute of Marketing and its membership services in
Ireland please consult the main CIM website at www.cim.co.uk or contact the CIM Ireland Regional
Director at tel: +44 (0)28 9146 9901 or email: cim@quintusmanagement.co.uk.
June 2009
The Chartered Institute of Marketing and the Project Team and The CIM Ireland Board urge businesses to take qualified professional advice before embarking on
any new business initiative.
The views expressed in this paper are those of the Project Team and do not necessarily reflect the views of The Chartered Institute of Marketing. The Project
Team, the CIM Ireland Board and the Institute do not accept responsibility of financial loss to any person or organisation resulting from commercial actions
undertaken (or failure to take actions) on foot of this paper or as a result of views and perspectives that the paper presents. Further, the above parties do not
assume any duty of care in relation to the affairs of any person or organisation in the furtherance of commercial policies or businesses initiatives.


                                                                                                                                                                                               1
1. InTRoduCTIon                                       The purpose of this position                          2. BaCkGRound analySIS                                  With the turn of the year there was a marked
                                                      paper is twofold:                                                                                             increase in business closures and multinationals
                                                                                                                                                                    were announcing consolidation initiatives and
How this paper can                                      • To provide professional marketers with a          Understanding the                                       in some cases relocation plans. Unemployment
                                                                                                                                                                    was on the rise, selective short time/
help companies to                                         clearer understanding of the dynamics of
                                                          change that has marked this recession;            dynamics of change                                      wage reduction measures were becoming

use the recession to                                    • To encourage businesses to adopt revenue          & how we came to                                        commonplace and businesses were shelving
                                                                                                                                                                    planned investment programmes.
                                                          generation strategies that can work for
commercial advantage                                      them.                                             be here                                                 Government policies
                                                                                                                                                                    & banking provision:
                                                      The Chartered Institute of Marketing:
                                                                                                                                                                    The reality is that industry and commerce swiftly
Setting the scene &                                   With a membership network across 130                  loss of liquidity & the credit crunch:
                                                                                                                                                                    emerged as the front line victim of recession
understanding change:                                 countries, The Chartered Institute of Marketing                                                               but on whose shoulders the future well being of
                                                      is the world’s largest organisation for               The warning signs of potential economic
                                                                                                                                                                    all citizens is significantly dependent. What was
We are presently living through a period of           professional marketers and plays a primary            instability were perhaps evident as far back
                                                                                                                                                                    initially perceived as an emerging profitability
extended economic turbulence that is affecting        role in training, developing and representing         as 2005, but for many the collapse of the
                                                                                                                                                                    concern among leading edge financial
the size, structure and dynamics of markets           the profession. Seen as the voice of marketing        United States’ sub prime mortgage market, the
                                                                                                                                                                    institutions in selected geographic markets in
served by businesses in Northern Ireland              that sets standards within the industry, it is also   subsequent bankruptcy of Lehman Brothers
                                                                                                                                                                    late 2007 and early 2008 had unravelled into
and the Republic of Ireland. The speed with           a first port of call for marketing information,       and the British Government’s initial intervention
                                                                                                                                                                    a major global liquidity crisis with the business
which those markets readjust has prompted             knowledge and insight.                                to recapitalise Northern Rock Bank, represented
                                                                                                                                                                    sector having to withstand the worst of the
widespread trauma, particularly among smaller                                                               the first hard evidence that we were on the cusp
                                                      The Institute can trace its heritage back nearly                                                              problem.
companies as they struggle to find a business                                                               of global recession. The taxpayer led bail out
                                                      a century to 1911 and has had an established          of other UK banks and the Irish Government’s            The causes of the banking implosion are hotly
model that can give them stability. While it is
                                                      presence in Ireland since the 1950s. The              corresponding guarantees to underwrite the              debated, but the response of governments in
appropriate for management to institute fiscal
                                                      interests of professional members and regional        savings of Irish citizens in Irish banks, and the       Europe, America and Asia has been to intercede
prudence at such times, cost containment
                                                      programmes are managed by CIM Ireland,                more recent forced nationalisation of Anglo             by pumping emergency capital into the banking
measures alone are unlikely to provide a route
                                                      the Regional Board appointed by members in            Irish Bank were bold steps taken to dampen              system to maintain money flow to businesses
to success. Companies need to adopt clear
                                                      Northern Ireland and the Republic of Ireland and      nervousness in Ireland’s two economies.                 and the public. This was done to offset the
recovery strategies that centre on profitable
                                                      includes leading business executives, marketing                                                               risk of failure in the banking market and to
revenue generation that is market led and
                                                      consultants and distinguished academics.              Nonetheless by the third quarter of 2008
marketing driven.                                                                                                                                                   maintain buoyancy within the wider business
                                                                                                            consumers were keeping their credit cards in
                                                      Professional marketers who are engaged in                                                                     sector. However this also increased the levels
                                                                                                            their wallets and purses. In turn, businesses
                                                      various CIM committees commit their time on                                                                   of government debt or to put it another way it is
                                                                                                            scrambled to trim their activities and marketing
                                                      a voluntary basis to promote the interests of                                                                 ‘funding by deferred taxation.
                                                                                                            budgets were cut. Some too were finding it
                                                      the profession. The Institute also maintains a        difficult to secure adequate commercial finance         It is perhaps too early to speculate on the
                                                      regional office for Ireland based in Belfast.         to fund routine business projects. We coined            success of the intervention measures but
                                                                                                            a name for the phenomenon. We called it                 there are concerns in Northern Ireland and
                                                                                                            ‘The Credit Crunch’ as at that time our GDPs            the Republic of Ireland that the progressive
                                                                                                            had not contracted to the point that we would           recapitalisation of the banks using taxpayer
                                                                                                            reclassify our straitened circumstances as              funding may not ultimately be matched by
                                                                                                            ‘Recession.’                                            a parallel extension of finance to support


                                                  2                                                                                                             3
development and growth among Irish                       quickly lose sight of their market, their place in it     commercial success in the last two decades and               Marketing enterprise &
businesses. Currently many businesses,                   and their ability to influence it.                        this asset should not be allowed to wither simply            revenue generation:
especially SMEs who operate in relatively low                                                                      because the current collective market has reduced
added-value environments or those that have              Regional analysis – similar causes                        or changed its shape.
                                                                                                                                                                                It is not the application of government policies
been acutely affected by market change, report           but different effect:                                                                                                  or even the provision of banking services that
difficulty in securing acceptable commercial                                                                      northern Ireland:                                             create economic prosperity but the tenacity of
finance.                                                 As the outlook presents for the end of the                                                                             businesses to pursue opportunity for reward.
                                                         second quarter 2009 the Irish economies are              • While there has been a growing cross border                 It is about marketing enterprise and revenue
narrow perspective fuels the difficulty:                 experiencing difficulties and while the causes             dimension to the Northern Ireland economy in                generation.
                                                                                                                    recent years, it remains closely aligned to the
                                                         are broadly similar, the circumstances and their
                                                                                                                    fortunes and needs of the larger British market.            The world is a global market where demand
There is little doubt that this is the worst             effects are different:                                     There is significant dependence on UK consumption           for goods and services cannot be created but
recession for the last half-century and the                                                                         and less on external trade. At the same time there          its dynamics can be influenced. In this regard
most obvious consequence of instability and              Republic of Ireland:                                       has been an historic imbalance in the economy with          Irish businesses have the capacity to identify
uncertainty is that we will continue to experience                                                                  up to half of GDP being linked one way or another           and target additional revenue generation
business failures and rising unemployment                • Ireland’s domestic market is modest by international     to public sector priming;                                   opportunities within existing geographic and
until broad based confidence is restored.                  standards and historic economic growth has been
                                                                                                                                                                                sectoral markets or parallel markets that have
Nonetheless it is a sad feature of our current             significantly dependent on achieving a positive        • The rapid decline in the value of Sterling over the
                                                                                                                                                                                not been addressed in the past, and to refocus
                                                           balance of trade through exporting goods and             last two years has provided some buoyancy in
circumstances that every company closure and                                                                                                                                    their resources for such attainment.
                                                           services and through hidden exports such as              regional retailing and in the tourism sector that
block of layoffs has been trailed across the
                                                           tourism;                                                 has offset the slow fall in domestic retail demand.         Sitting on one’s hands in the hope that the
media as a continuous news story for more than
                                                                                                                    However elsewhere in the services sector there are          market will somehow rectify itself is not a
a year. While such reporting is factual, it is not       • However export industries, particularly of               signs of significant lethargy particularly in banking       viable strategy for success. The challenge for
the whole story.                                           manufactured goods, and the retail, tourism,             and financial services. There has also been a               management is to identify and pursue additional
                                                           construction and agricultural sectors, together          slowdown in construction and in agriculture. While
It should be stressed that very many businesses            with banking and financial services are feeling the
                                                                                                                                                                                revenue generation opportunities that counter
                                                                                                                    public sector projects may have dwindled, the sector
continue to meet the challenges of change and              recession most severely and securing adequate                                                                        the effects of market shrinkage.
                                                                                                                    itself and its purchasing power has remained stable;
to serve the interests of their shareholders,              commercial finance has become a challenge for
customers and staff. Indeed not all companies              many companies. In turn, businesses have been          • The province’s export output, mostly comprising
are incurring losses and some who have taken               deferring investment decisions and cutting operating     manufactured goods and construction output, is
the occasion to reposition their businesses have           overheads in an effort to increase liquidity;            being maintained but performance is relatively
maintained or increased their sales turnover.                                                                       lacklustre. Indeed many of the more high profile
                                                         • Meanwhile, consumer spending has reduced more            business closures announced in the manufacturing
Some too have increased their profits.
                                                           swiftly than many commentators initially recognised      sector in recent months have been triggered by
A consequence of the tide of gloom is that                 as fear of recession’s consequences has promoted         recessionary difficulties in selected international
many companies appear to be adopting                       self imposed prudence, and the result is being felt      markets that have eroded domestic profitability.
panic measures that are inconsistent with                  right across the economy; and                            In turn this has impacted on other facets of the
former business positioning strategies.                                                                             economy; and
                                                         • The Irish Government recently introduced a series
Many too are employing overzealous cost                    of key budget measures to tackle many of the more      • On the surface of it the Northern Ireland businesses
containment measures to optimise liquidity                 sinister aspects of recession and the weakened           appear to be weathering the storm better than in the
without necessarily thinking through how the               economy. However the relatively high value Euro          Republic of Ireland. However there is a tendency
business will evolve beyond the next couple of             severely limits Ireland’s options for stimulus, yet      of businesses to assume market contraction to
months. The risk is that marketing capacity (the           wholesale reliance on EU intervention to facilitate      be deeper than it is which suggests that business
product of marketing resources and marketing               growth may impede economic recovery. However             opportunities are being overlooked. At the same
investment) is reduced and companies can                   putting this to one side, Irish business innovation      time many companies have greater business
                                                           and enterprise has been a major factor in collective     potential than are necessarily being realised.

                                                     4                                                                                                                      5
3. MaRkeTInG develoPMenT SCenaRIoS                        new branded products into                           development overheads should be more than               also a good vehicle to initiate brand acquisition
                                                          existing markets:                                   offset by the financial returns.                        searches. However unless one knows the
                                                                                                                                                                      targeted brands and their markets intimately
Options for revenue                                       In this situation the scenario is to expand
                                                                                                              Opening up on-line marketing to sell over
                                                                                                              the Internet can be a positive move for many
                                                                                                                                                                      there is merit in taking professional advice
                                                                                                                                                                      before entering into any serious negotiations.
generation for Irish                                      the share of the market currently served by
                                                          marketing new branded products and services
                                                                                                              businesses in business-to-consumer activity.
                                                                                                              Moving into new sectors in an established               Similar opportunities can also be developed
companies                                                 into markets already being served, thus
                                                          increasing market share. Ideally this may involve
                                                                                                              market can also strengthen the overall                  through acquiring or offering a franchise, or
                                                                                                              market share that a business enjoys but it              collaborating with another company with similar
                                                          using the same distribution channels to save        can sometimes cause conflict with existing              needs or in broadly similar markets. One can
                                                          cost but may also allow some extension into         distribution outlets.                                   exchange products and brands or engage
Holding what you have & diversifying:                     areas of the market where distribution is weak.                                                             in collaborative marketing or manufacturing
                                                                                                              As before, research needs to be undertaken
                                                          In recessionary conditions merely providing new                                                             without necessarily selling or acquiring a
                                                                                                              to target and monitor the market development
In the case of multinational businesses and               products under an existing established brand                                                                business. The idea is that both parties end up
                                                                                                              process.
larger multi-brand corporations operating in              may not provide enough advantage to guarantee                                                               with a distribution arrangement and revenue
diverse sectors and markets, the pursuit of               listings among distributors or be sufficient to     new branded products                                    flow that is greater than either could achieve on
revenue generation strategies will usually be             motivate end use customers in your favour.                                                                  their own.
                                                                                                              into new markets:
assumed at a head office level. However for               A new or acquired brand with its own mix of
businesses that are owned and operated in                 products can open doors provided the brands         The final scenario is a bolder strategy but one
Northern Ireland and the Republic of Ireland              are supported with adequate promotion.              requiring greater risk and commitment. The
whether a large enterprise, an SME or a micro                                                                 intention would be to acquire a business activity
business the first requirement is to hold as              Some research needs to be undertaken
                                                          to identify new opportunities to import and         already operating in its own established market
much of one’s existing market as is possible                                                                  with its own brands and use the increased
while maintaining both profitability and liquidity.       distribute goods or to contract manufacture, or
                                                          indeed to acquire brands. Attempting to develop     offering to target new markets that neither
This is necessary to create a breathing space to                                                              organisation might have contemplated in the
research, evaluate and pursue new activity, and           a brand from scratch may be an unwise move in
                                                          the current climate.                                past.
to finance such development.
                                                                                                              The development of new products in new
For the most part new revenue                             existing branded products                           markets has the advantage of not upsetting
generation projects will fall into                        into new markets:                                   present supply chain arrangements through
one of three key types of activity:                                                                           not competing directly with existing products in
                                                          The second scenario envisages extending the         existing markets.
                                                          geographic boundaries or sectoral coverage
  • Marketing new products into
                                                          of existing brands. For example a regional          Finding new business opportunities:
    existing markets;
                                                          company that has historically worked in one
  • Marketing existing products in new                    part of Ireland could open up business across       Frankly this is a lot less daunting than most
    markets; and                                          the border or move into Britain or Europe.          business executives realise. Touring around
                                                          One is using the same type of supply chains         trade fairs at major international exhibition
  • Marketing new products in new markets
                                                          but merely in a new location. A popular route       centres can often help to spot opportunities as
                                                          is to acquire a business with its own brands        can Internet research and through studying the
                                                          that operates in another market and use it as       media. In the current climate many companies
                                                          a vehicle to develop new customers. If one          are keen to establish new distribution and
                                                          plans the development well, market entry and        service facilities for their brands. Indeed it is

                                                      6                                                                                                           7
4. undeRSTandInG MaRkeT dynaMICS                                                                         Barriers to growth:
                                                                                                          FeaTuReS                             IMPaCT                                  IMPlICaTIonS
Addressing & evaluating                                                                                   • Planning system;                   What buildings & facilities do we       Need to engage rather than fight
                                                                                                                                               require & when?                         planning regulations
the structure, motivation                                                                                 • Revenue burdens on business        What is the most cost effective         Need to align resources to meet

& energy of markets                                                                                         growth;                            way to reach & serve customers?         customer needs but cut dead
                                                                                                                                                                                       weight
                                                                                                          • Exchange rates;                    How experienced & competent             Opportunities for NI companies
                                                                                                                                               is our marketing team?Can we            to secure better margins.
                                                                                                                                               take advantage of Ireland’s two         Opportunities for RoI companies
drivers for & barriers to growth:                                                                                                              currencies to strengthen our            to buy in resources from Sterling
                                                                                                                                               marketing?                              zone (cost effective)
In order to expand the size of target markets available to Irish businesses it is important to
                                                                                                          • Irish market is small in global    How vulnerable is our business to       Need to develop new geographic
appreciate the development drivers that fuel growth and the barriers that sometimes exist to impede
                                                                                                            terms;                             market shrinkage?                       or sectoral markets
progress in relation to markets. The following is a suggested list of market features pertaining to
Ireland together with commentary. Such features are provided to aid evaluation and may vary from          • Few world beating products;        Do we provide world-beating             Need to align our outputs to world
                                                                                                                                               products or can we supply those         beating products
market to market.
                                                                                                                                               who do?
drivers for growth:                                                                                       • Low investment in                  Can we gauge the effectiveness of       Need to build investment to meet
                                                                                                            technology & R&D                   our technology & R&D?                   the needs of the market
FeaTuReS                         IMPaCT                            IMPlICaTIonS                           • Poor levels of skill among         What critical skill needs do we         Critical skills need to be the best in
• Capacity to bring great        Can we reinvigorate our           Need to pursue better utilisation        workforce;                         have?                                   the business
  products to market;            product management?               of marketing & facilities              • Poor strategic marketing skills;   How effective is our marketing          Marketing needs to be driven from
• Higher added value             How well do we know               Target more profitable activities                                           capacity?                               the top rather than a resource to
  opportunities;                 our own business?                                                                                                                                     management!

• Support network for            What additional resources         Target expertise to meet               • Lack of project capital; and       While not essentially a marketing       Need to scope the investment &
  business growth;               do we need?                       needs of the business?                                                      feature, it is essential that any new   projected return
                                                                                                                                               revenue generation programme
• Good companies with            Can we think global               Develop greater added value                                                 has adequate project capital
  world-wide networks;           while acting local?               services for broad application
                                                                                                          • Lack of working capital.           Is there sufficient working capital     Need to secure working capital to
• Government infrastructure      Are there gaps in our knowledge   Need to gear for best international                                         to fund day-to-day operations?          meet needs
  focused on training; and       & know how that we should         standards (or better)
                                 address?
• Output of qualified            How experienced & competent       Utilise marketing talent where
  marketing graduates.           is our marketing team?            it can generate best return           Management related marketing evaluation features:

                                                                                                         The following is a supplementary listing of commonly held beliefs of management that are prevalent
                                                                                                         in many Irish businesses that sometimes have a bearing on market positioning assumed by
                                                                                                         companies. Many such beliefs are ‘urban legends’ that can distort judgement. While this is not a
                                                                                                         scientific analysis it is based on the case experiences of the Project Team and is therefore offered
                                                                                                         as a component in understanding market dynamics.



                                                 8                                                                                                              9
other features in marketing evaluation:                                                                              other features in marketing evaluation (continued):

FeaTuReS                               IMPaCT                                  IMPlICaTIonS                          FeaTuReS                           IMPaCT                                  IMPlICaTIonS
• Fear of failure leading              Strategic stagnation looms              Need vision & direction               Education mindset problem among    ‘I know about widgets - marketing       Marketing should be essential skill
  to inaction;                                                                                                       family businesses (SMEs);          is a sales function’                    for management
• Belief that the Chinese know         ‘Impotence rules OK’                    Need clear SWOT analysis of own       Poor product design &              Need to embrace design for              Opportunities in product
  more than us & subsidise their                                               & other businesses                    development ethos;                 marketing advantage                     positioning & development
  exports;                                                                                                           Lack of utilisation of marketing   Companies are insufficiently            Educate the decision makers
• Belief that recession is due to      Unfounded faith in own ability to       Need to develop a survival strategy   skills;                            marketing driven
  lack of money supply interfering     survive without change                  & plan                                Marketing is treated as a          No real ownership of marketing by       Educate the decision makers
  in the market;                                                                                                     departmental function if at all;   Boards (mindset problem)
                                       Unfounded belief that the market        Need to develop a survival strategy   Companies have poor knowledge      Need to know competitors as well        Educate the decision makers
                                       will return back to normal after        & plan                                of competitors;                    as own businesses
                                       recession
                                                                                                                     Poor understanding of link         Failure of business to prioritise for   Educate the decision makers
                                       Unfounded belief that failure           Need to develop a survival strategy   between marketing & revenue        recovery
                                       is inevitable & we should shut          & plan                                generation; and
                                       business down
                                                                                                                     Management preoccupied with        Poor understanding of business          Educate the decision makers
• Poor understanding of dynamics       Failure to capitalise on brand          Need to build brand potential         short-term thinking.               positioning
  of brands;                           positioning
                                       Undue reliance on single historic       Opportunity to acquire new brands
                                       brand
• Failure to understand &              New opportunities to expand             New products in new markets -
  capitalise on recession;             markets can be developed                capitalise on market change
• Rate of company closures;            Reduces skills base but provides        NNeed to channel resources
                                       opportunities to acquire skills         productively
• Change in retailing & distribution   Reduces opportunities to sell           Look to new distribution
  caused by recession;                 products                                opportunities (Internet)
• Irish companies serve niche          Economic change may close               Apply current technologies to new
  markets or local need;               opportunities in the domestic           opportunities
                                       market
• Markets shrinking due to             Falling commercial viability            Need to scout new markets -
  recession;                                                                   market intelligence
• Fear of failure due to relocation    Loss of historic customer base          Look to new markets & new
  or closure of major companies;                                               products
• Poor understanding of link           Need business improvement               Review marketing focus - look to
  between marketing & profit;          models                                  universities & other providers
• Lack of marketing experience at      Reduced knowledge of alternative        Broaden international marketing
  coal face;                           opportunities                           investment
• Poor utilisation of role models;     Management has limited                  Encourage role models
                                       understanding of how others do things


                                                        10                                                                                                               11
Political & geographic considerations:            Republic of Ireland:                                    the biggest differential advantage for more           Republic of Ireland & northern Ireland:
                                                                                                          than 30 years;
The two Irish markets possess unique                  • The Republic of Ireland is an economy &         • The dominance of the public sector on                  • NI & RoI are heavily dependent on a handful
characteristics that need to be factored into           market that is surprisingly self sufficient       the Northern Ireland economy is huge &                   of core industries for wealth & employment;
any analysis if a full understanding of market          & self-reliant. Companies also appear             most commentators believe that while it                • While there have been positive steps to
dynamics is to be facilitated. However the              more focused on financial growth than in          has underpinned regional stability in the                facilitate greater cross border business
markets also share many features in common              Northern Ireland;                                 current recession it is barrier to sustainable           development, much more requires to be
as the undernoted highlights.                                                                             development;
                                                      • Over the last two decades businesses have                                                                  done to build the Inter Ireland economy;
                                                        developed greater links in international        • Businesses need to understand that                     • Ireland as a whole has a legacy of historic
                                                        markets & among international companies;          recession means that the structure of                    brands and many companies have become
                                                      • Companies have become victims of Euro             markets is changing. However it does                     global businesses, but there are surprisingly
                                                        obsession with many expressing the view           not mean that those markets have shut                    few marketing champions to mentor the
                                                        that there is limited room to strengthen          down. There is also a poor understanding                 next generation of innovative businesses;
                                                        competitiveness;                                  of the need to adopt revenue generation
                                                                                                          measures; and                                          • There is a need to encourage the
                                                      • There is a pathological fear among Irish                                                                   development of more added value
                                                        SMEs about long-term survival without           • There is a perceived lack of business                    companies that can compete in international
                                                        local multinational manufacturing. This is an     orientation & commitment to business                     markets;
                                                        outgrowth of the strong historic relationship     development within the province’s political
                                                                                                          infrastructure.                                        • There is a need to develop & project
                                                        that existed between local SMEs & key
                                                                                                                                                                   Ireland’s R&D, technology & manufacturing
                                                        multinational plants; and
                                                                                                                                                                   capability; and
                                                      • Politics on business downturn is becoming
                                                                                                                                                                 • Preoccupation with cost containment will
                                                        localised & negative that appears to be
                                                                                                                                                                   not generate revenue in recession.
                                                        inspired by fears that Sterling devaluation
                                                        will adversely affect local competitiveness.
                                                        The problem is most noticeable in retailing
                                                        & tourism where a balance of trading
                                                        advantage has passed to Northern Ireland.

                                                  northern Ireland:

                                                      • Northern Ireland companies often display
                                                        a lack of corporate vision/ambition which
                                                        is particularly marked among older family
                                                        businesses;
                                                      • Companies in Northern Ireland are not
                                                        doing enough to capitalise on the export &
                                                        cross border advantage that the progressive
                                                        devaluation of Sterling has created. Despite
                                                        an increase in the costs of imported
                                                        materials, this has provided companies with

                                                 12                                                                                                        13
5. ConCluSIonS & IMPlICaTIonS                        shrinking in varying degrees due to consumer         However experience suggests that a primary               The global recession has impacted the Pacific
  on Revenue GeneRaTIon                              behaviour and trading constraints such as            driver in revenue development is frequently              Rim economies very heavily and they too will
                                                     reduced access to working capital. This              one of opportunity especially where it involves          be establishing creative ways of broadening
                                                     has impeded profitability and liquidity. It has      the potential acquisition of a targeted business         their commercial appeal in the markets of the
Evaluating the role                                  also weakened the financial base of many
                                                     companies who may become future casualties.
                                                                                                          as a going concern or negotiating to acquire
                                                                                                          brands and assets from a receiver. In such
                                                                                                                                                                   world. Therefore we cannot be complacent
                                                                                                                                                                   about our positioning in target markets. Our
& benefit of revenue                                 Sadly recessionary conditions have also served       circumstances the ‘window’ of that opportunity           capacity to create wealth generation, jobs
                                                     to constrain enterprise;                             may often be measured in hours or days.                  and a future for succeeding generations will
generation for                                       The adoption of prudent cost containment             In revenue generation speed, decisiveness and
                                                                                                                                                                   be significantly determined by the enterprise,
                                                                                                                                                                   efficiency and effectiveness of our businesses
businesses in Ireland                                measures within companies can provide
                                                     short-term improvements in business margins
                                                                                                          management competence is everything.
                                                                                                                                                                   and the aspirations and determination of
                                                                                                          Implications for businesses                              entrepreneurship. It comes down to people.
                                                     and liquidity and help to buy time. However
                                                     significant cuts in marketing expenditure will       & policy makers:                                         Implications for businesses:
Implications for                                     reduce marketing capacity, weaken brand
business development:                                positioning and erode a company’s influence on       Over the last twenty years comments have                 For the immediate future Irish companies
                                                     its market;                                          often been voiced about the capacity of                  should consider how best to gear themselves
Based on the Project Team’s review of                                                                     European nations to stay ahead of the game               for sustainable change as markets do not stand
                                                     Irish businesses should consider measures to
marketing capacity, the following conclusions                                                             and to continue to play a premier role in global         still, nor do competitors serving customers in
                                                     increase the size of target markets and broaden
are provided to assist businesses in reviewing                                                            business. Such views are usually taken in                those markets.
                                                     brand/product offerings in order to offset the
revenue generation opportunities and                                                                      conjunction with fears about the rising power of
                                                     shrinkage that is occurring and place resources                                                               Experience suggests that the more effective
introducing new strategies:                                                                               third world economies like those of the Pacific
                                                     behind market development. Doing nothing is                                                                   businesses who embark on bold revenue
                                                                                                          Rim countries. Indeed the speed and diligence
The ‘Recession’ label that has been applied          not an option;                                                                                                generation programmes tend to be those
                                                                                                          of those nations in gearing their economies
to the GDP performance of the UK and Irish           Primary developmental considerations include         to meet global needs, especially in relation to          that are market led and marketing driven. It
economies will continue to be a constraint to        extending geographic penetration to embrace          manufacturing, has been little short of stunning.        is important that companies should consider
business development for some time to come.          new markets and customers, acquiring new                                                                      optimising the skills and effectiveness of
Assuming global confidence can be stabilised                                                              The ability to remain wholly competitive in              management teams and the inclusion of
                                                     brands and products to market through existing
over the next twelve months it is probable                                                                serving the needs of customers across markets            experienced qualified marketing practitioners
                                                     distribution channels, or using acquired brands
that some greater stability will be achieved in                                                           that we would wish to serve is the best form             in such teams is an essential ingredient in
                                                     and products as a driver for longer term
many markets served by Northern Ireland and                                                               of sustainable defence open to businesses                success.
                                                     corporate development;
Republic of Ireland companies. While it is not                                                            in Ireland. The complexity of relationships
                                                     The key to effective revenue generation              between companies and end use customers                  Company management should also maintain
within the scope of this paper to comment on
                                                     is sound planning; bold execution of new             and the motivation and discerning behaviour              their marketing knowledge and skills through
corrective measures that governments may
                                                     strategies and attention to detail. Companies will   of customers has been well documented. If                continuous professional development. The
adopt in the future, it seems probable that
                                                     need to evaluate the opportunities and their own     the only consideration were one of price then            Chartered Institute of Marketing can provide
the extent of government debt that has been
                                                     limitations and put the necessary investment         China, as the most cost effective economy in             professional advice and guidance to companies
incurred in underwriting stability in the banking
                                                     in place before embarking on an expansion            the world, would be the only supplier of goods           in this regard.
sector will have to be substantially financed
through taxation. This means that ‘Credit            or acquisition programme. Thus entering into         and services. Fortunately enterprise, innovation,
Crunch’ conditions are likely to remain features     early dialogue with investors, banks, regional       marketing effectiveness, brand preference and
of the Irish economies for many years to come;       development agencies and selected marketing          customer care are overriding assets that give us
                                                     advisers is essential before committing              a differential advantage.
The net effect of recession is that traditional      investment and resources to a project; and
markets served by companies have been
                                                    14                                                                                                        15
Implications for policy makers:                        While it is not within the scope of this paper to
                                                       lobby on any aspect of business development,
There has been a tendency among policy                 policy makers may wish to reflect on the need
makers in Ireland as elsewhere to place core           to explore a breadth of future measures that can
emphasis on the development and regulation             deliver greater cohesion to business generation.
of society. The delivery of health, welfare,           The revenue generation needs of businesses
safety, education, citizenship, cultural tolerance,    in Northern Ireland and the Republic of Ireland
freedom of movement, the right to work and             differ from other parts of the European Union
live, and the stewardship of environmental             and our challenge should be to gear ourselves
resources have been at the heart of                    to compete with the best in the world.
governmental policies for decades.                     The need for revenue generation and better
However our capacity for economic prosperity is        marketing is not a ‘one off’ expedient to relieve
significantly linked to our effectiveness in trade     the trauma of recession. It is our future.
and industry and greater priority should to be
focused on strengthening the effectiveness of
our business infrastructure and our capacity to
market our products and services.




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The Chartered Institute of Marketing
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