MANAGING AND MAXIMIZING YOUR PR AND COMMUNICATIONS BUDGET CNI’s Journey, Mistakes, and Lessons Learned Kenny Ong CNI Holdings Berhad
May 06, 2015
MANAGING AND MAXIMIZING YOUR PR AND COMMUNICATIONS BUDGETCNI’s Journey, Mistakes, and Lessons Learned
Kenny OngCNI Holdings Berhad
Problems from the start
1. No money
2. Split Objectives: Sales? Share Price? Image?
3. Difficult to hire
4. Independent entity
5. Charity center
6. MLM image nightmare
7. Multi-cultural & Multi-lingual
8. Close Regulatory scrutiny (food act, health act, Jakim, KPDN)
9. Public Listed
How to fail without trying
The Roadmap to Failure
Fred Wiersema and Mike TreacyP
erf
orm
ance
Time
Clear Sailing
Today’s performance
Ad-hoc Tactics
Denial & Defense
Doom Projections
Overdue Failure
The Moment of Truth
X
Performance Freefall
Tomorrow’s actual
performance
Downpresure of Unclear Strategy
Denial and Defense
• “It’s not really good value our competitor is offering, because it doesn’t include a lot of our features.” - ABC vs Air Asia
• “It’s good value but not in our preferred customer market.” - ABC vs Toyota
• “Sure they’re hurting us, but with their unfair advantage, what can we do?” – ABC vs MILO
• “The rules we are playing by have always worked before” – AMEX vs VISA
The Roadmap to Failure
Fred Wiersema and Mike TreacyP
erf
orm
ance
Time
Clear Sailing
Today’s performance
Ad-hoc Tactics
Denial & Defense
Doom Projections
Overdue Failure
The Moment of Truth
X
Performance Freefall
Tomorrow’s actual
performance
Downpresure of Unclear Strategy
Ad Hoc Tactics• Selectively hold discounts to hold business that
has started to go elsewhere• Introduce new promotions, terms, conditions, and
offers to confuse and cloud the market• Beef up customer service by adding people to fix
mess-ups and quicken delayed shipments• Delay capital investments and adjust accounting
methods to portray quarterly financial results more favorably
• Introduce “new and improved” products that are new in form, but not in substantive ways that are of consequence to purchasers
The Roadmap to Failure
Fred Wiersema and Mike TreacyP
erf
orm
ance
Time
Clear Sailing
Today’s performance
Ad-hoc Tactics
Denial & Defense
Doom Projections
Overdue Failure
The Moment of Truth
X
Performance Freefall
Tomorrow’s actual
performance
Downpresure of Unclear Strategy
Before moving on…
• How is PR budget not maximized?
1.Because I can - Competency problem
2.Poor business value – Ignorance problem
3. No Budget lah - Alignment problem
4.Not exciting lah – Glamour problem
Contents:
How can PR budget be maximized:
• Linking Comm to the real world of Business
• Driving WOM as ‘do-or-die’ mission
• Comm as Integrated affair
• Virtuous Cycle for full $$ Impact
• Continuous Networking vs. Fancy Campaigns
A. Linking Comm to the real world of Business
The anchor for all PR decisions
About: CNI
1. 18 years old
2. Core Business: MLM
3. Others: Contract Manufacturing, Export/Trading, eCommerce
4. Malaysia, Singapore, Brunei, Indonesia, India, China, Hong Kong, Philippines, Italy, Taiwan
5. Staff force: ± 500
6. Distributors: 250,000
7. Products: Consumer Goods and Services
Intro: MLM
1. Sell through people
2. Buyers = Members (most of the time)
3. Members = Sponsoring
4. Product
5. Integrity
6. R&D
7. Training
8. Functions & Events
9. Tight regulations
Intro: CNI
CNI’s Business Model background
Factory CNIE
DC
SPLeadersCustomers
R&D
COMM
Market Research
Internal External
Leaders Distributors
Suppliers
Associations
Universities
NGOs
Investors
Media
Government
Public
Authorities
Proactive Reactive Proactive Reactive
COMM Tools COMM Tools
What is the purpose of COMM?
Ultimate Objective of Marketing: “Get more people, to buy more things, more frequently, at higher prices.”
Sergio Zyman
“Retention and Loyalty are useless if No Conversion is happening.”
What is the purpose of COMM?
“Retention and Loyalty are useless if No Conversion is happening.”
“Comm (PR) is useless if No Conversion is happening.”
Problem…
“In business after business, 60% to 80% of lost customers reported on a survey just prior to defecting that they were satisfied or very satisfied.”
HBR March/April 1996
What are they really buying?
"They are the most innovative"
"Constantly renewing and creative"
"Always on the leading edge"
"A great deal!"
Excellent/attractive price
Minimal acquisition cost and hassle
Lowest overall cost of ownership
"A no-hassles firm"
Convenience and speed
Reliable product and service
"Exactly what I need"
Customized products
Personalized communications
"They're very responsive"
Preferential service and flexibility
Recommends what I need
"I'm very loyal to them"
Helps us to be a success
Product Leadership
OperationalExcellence
CustomerIntimacy
Operational Excellence(low cost producer)
Ref: The Discipline of Market Leaders, Michael Treacy & Fred Wiersema; 1995
Product Leadership(best product)
Customer Intimacy(best total solution)
Strategy: Value Disciplines
Operational Excellence
• Competitive price
• Error free, reliable
• Fast (on demand)
• Simple
• Responsive
• Consistent information for all
• Transactional
• 'Once and Done'
Operational Excellence
• Competitive price
• Error free, reliable
• Fast (on demand)
• Simple
• Responsive
• Consistent information for all
• Transactional
• 'Once and Done'
Customer Intimacy
• Management by Fact
• Easy to do business with
• Have it your way (customization)
• Market segments of one
• Proactive, flexible
• Relationship and consultative selling
• Cross selling
Customer Intimacy
• Management by Fact
• Easy to do business with
• Have it your way (customization)
• Market segments of one
• Proactive, flexible
• Relationship and consultative selling
• Cross selling
Product Leadership
• New, state of the art products or services
• Risk takers
• Meet volatile customer needs
• Fast concept-to- counter
• Never satisfied - obsolete own and competitors' products
• Learning organization
Product Leadership
• New, state of the art products or services
• Risk takers
• Meet volatile customer needs
• Fast concept-to- counter
• Never satisfied - obsolete own and competitors' products
• Learning organization
Strategy: Value Disciplines
Operational Excellence(low cost producer)
Ref: The Discipline of Market Leaders, Michael Treacy & Fred Wiersema; 1995
Product Leadership(best product)
Customer Intimacy(best total solution)
Strategy: Value Disciplines
Operational Excellence(low cost producer)
Ref: The Discipline of Market Leaders, Michael Treacy & Fred Wiersema; 1995
Product Leadership(best product)
Customer Intimacy(best total solution)
Strategy: Value Disciplines
The McPlaybook*
Make it easy to eat• 50% drive-thru• Meals held in one
hand
Make it easy to prepare• High Turnover• Tasks simple to learn
& repeat
Make it quick• “Fast Food”• Tests new products
for Cooking Times
Make what customers want• Prowls market for new
products• Monitored field tests
*Adapted from: Businessweek , Februrary 5th 2007
How does that impact PR?
Philosophy
COMM
StrategyCorp Comm
Strategy
StructureResources
Leadership
Person
Our Philosophy
“We are more than just a business. We strongly believe that every
individual has the opportunity to attain a better quality of life and
health through CNI.”
B. Driving WOM as ‘do-or-die’ mission
Big picture, Small picture. PR’s role in both pictures.
What is the Objective?
Ultimate Objective of Marketing: “Get more people, to buy more things, more frequently, at higher prices.”
Sergio Zyman
“Retention and Loyalty useless if No Conversion is happening.”
What is the Objective?
Loyalty is Useless…
• Virtual Consumption vs. Real Consumption
What is the Objective?
Loyalty is misleading…
• Heavy Consumption ≠ Loyalty
• Loyalty ≠ Heavy Consumption
What is the Objective?
1.Comm = Relationship (something like Dating)
2.Comm ≠ Media glitz 3.Comm ≠ ATL/BTL/BwTL/ArTL/FTL4.Comm ≠ CSR5.Comm = Get more people, to buy
more, more frequently, at higher prices
What is the Objective?
‘Do-or-Die’ KPIs for CNI• Revenue• ARPU
• Sponsoring• Retention
• Commission Plan (BDP)• Product• Corporate Image
What is the Objective?
Sponsoring
BDP
Why should I join?
Credibility Product
Corporate Comm
What is the Objective?
• So…the ultimate objective of Corporate Comm is to drive Word-Of-Mouth.
• That’s it.
• Now, it’s easy to maximize the budget.
C. Comm as Integrated affair
Unity is worth more than the annual budget.
COMM
Market Research
Internal External
Leaders Distributors
Suppliers
Media
Government
Public
Authorities
Associations
Universities
NGOs
Investors
Proactive Reactive Proactive Reactive
COMM Tools COMM Tools
Integrated affair
Conversion
Comm
S&M MBSCCD
[Internal] [External] [Creative]
Example: What we needed
• The birth of Malaysia’s 1st Tongkat Ali Ginseng Coffee
Example: AGM and myCNI
Integrated affair - GROUP
Group Media
CCD
CNIE
InfusoQP[MLM]
[Contract] [Café]
CNIH
[Investn]EM
[Export]
KESB
[eCom]
D. Virtuous Cycle for full $$ Impact
Feed you, Feed me.
COMM
Market Research
Internal External
Leaders Distributors
Suppliers
Media
Government
Public
Authorities
Associations
Universities
NGOs
Investors
Proactive Reactive Proactive Reactive
COMM Tools COMM Tools
Virtuous Cycle
Internal External
Feed
Feed
Full $$ Impact Both Sides
Internal• Halal Committee• Social Education
(e.g. SCK)• Umrah trip• China Trip• RBOS• CFA/HFA• Coffee Van
External• Sponsorship• Donations• News clippings• Newspaper Ads• MHI• Awards• Corporate Profile• AGM• Gov. Celebrity• Analyst research
Full $$ Impact Both Sides
Internal• Entrepreneur Dev.• Health products• Health education• “Made in Malaysia”• Events• Media Celebrity
External• Website• DSAM• Yayasan• Publish Book• Social Education• Crisis Comm• Children Education• National interest• Analyst BD
connections
E. Continuous Networking vs. Fancy Campaigns
R&D in Totality
Remember…
1.Comm = Relationship (something like Dating)
2.Comm ≠ Media glitz 3.Comm ≠ ATL/BTL/BwTL/ArTL/FTL4.Comm ≠ CSR5.Comm = Get more people, to buy
more, more frequently, at higher prices
Example Networking activities
• Durian Party
• Wisma Tour
• Hampers
• Umrah
• China Factory Visit
• Large Events
• Donations to Media
• Jakim visit
Issues and Challenges
Problems, Problems, Problems
Sources of Image problems
Industry
Management
Staff
Frontline
Sup
plie
rs/V
endo
rs Retail/D
istributor
Industry-inspired problems
1. Get-Rich-Quick Schemes (Skim Cepat Kaya)
2. Direct Selling myths
3. Bad Hats
4. Imposters
5. Products on Shelves
6. Hazardous products by other companies
7. Increasing Regulations
Don’t know how to use to maximum effect
1. ATL
2. Web
3. Blogs (Web 2.0)
4. Mobile
5. Investor Relations
IR problems
“Good news for stockholders can be bad news for other
stakeholders.” Gregory Miller, Assoc. Prof., Harvard Business School.
Summary
Summary
How to maximize budget?
1. Focus on the right Priority – WOM
2. Drive WOM by Integration and Virtuous Cycle
3. Build Integration and Virtuous Cycle using Constant Networking (hardwork)
Thank You.
soft copy of slides: http://totallyunrelatedrandomanddebatable.
blogspot.com/