Marketing

I often love Fred Wilson‘s blog, A VC, but sometimes it’s not so easy to love. A few days ago Fred posted a dismissal of marketing. He said marketing is only for companies with lousy products or companies like Zynga, Budweiser or Viagra who can only grow their businesses marginally through customer acquisition. I’ve been on the road for LAUNCH and let it go after he admitted his first post had many bugs, but then I saw one of Fred’s commenters on his third post on marketing dropping Peter Drucker into the fray. James Harradence, said:

Peter Drucker, I am paraphrasing, basically said that every oganization needs to recruit and retain customers (although that is not always what they call them). Anyone who faced a customer was in marketing. He also said that anyone who was not directly related to that function, who was below the C-level, could be outsourced.

Interesting. I can’t imagine that this “outsource everyone below C-level” strategy has ever worked, but I had to add my own Drucker-infused take on the importance of marketing:

The Drucker quote that always sticks with me (paraphrased here from memory) is that “companies have only two functions: innovation and marketing. All the rest are costs.”

“Innovate and market” means “create something amazing and then go tell people about it.”

Fred Wilson is smart, but his original post that said “marketing is for companies with terrible products or companies that need to squeeze profits out of new customers” is flawed. I’m sure he has seen plenty of startups who believe that marketing spending will make up for failing to innovate, but marketing simply means telling a story to an audience.

I market to customers. I market to investors. I market to talent. I market to partners. I don’t just throw a budget line at marketing after failing to create something attention worthy. There is a difference.

After a little digging, I found that the actual quote is:

Because the purpose of business is to create a customer, the business enterprise has two—and only two—basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs. Marketing is the distinguishing, unique function of the business.

It’s not so easy to dismiss the importance of marketing — even in startups!

Rand Fishkin has a great, longer rebuttal to Fred’s flawed post on marketing over on SEOmoz. He points out that marketing is for companies that have great products. Some of this was referenced in Fred’s third marketing post.