Blog entry #14 from MBA - www.mba-marketing.co.uk
Recent events - AIG, HBOS, Lehman Brothers, the possibility of global financial meltdown - prompted me to write something pithy about the financial markets. It then occurred to me that - despite studying economics at University, despite an MBA, and despite having been the owner of all manner of financial products over the years - I know very little about derivatives, hedge funds, and so on. I am just another ignorant end user.
And that is the point, for financial markets have very little in common with any other 'market' or indeed with 'marketing'. Right up to last week, the financial markets exemplified the sort of free market economics and short-term profit maximisation that might surprise even Milton Friedman. In what other market would end users (people like you and me, with mortgages, say) be bundled up and traded from one financial organisation to another, as though we were pork belly futures? Bear this in mind if you ever hear a financial institution talk about 'customer relationship management'.
It is highly unlikely that there is any sort of consultation or research carried out with the individuals who make up these groups of 'bundled assets', or even with intermediaries such as mortgage brokers. Which brings me to this recent report in the Birmingham Mail: 'A plan to respray every cab in Birmingham has been put on ice after it emerged that consultants, paid £24,000 to assess the scheme, failed to ask cab drivers what they thought.'
This raises two points. The first is to say that in my experience, it has never been necessary to ask a cab driver what they think, as they'll tell you anyway. The second point is to say that this actually typifies a lot of marketing research programmes. Customers will be subjected to all manner of research techniques and methodologies, but often the actual frontline staff who live and breathe the subject (during working hours, anyway) are never consulted. It's importsnt to remember that frontline staff are important for (at least) two reasons: first, their own satisfaction is directly related to customer satisfaction; and second, they are valuable conduits of customer insight and intelligence.
I try to involve frontline sales and service staff in any project I am involved with. Recruitment is usually straightforward and participation can usually be relied upon. Above all, it is frightening how accurate many of the outputs from these sessions turn out to be - certainly when compared with those of management!
And in the case of financial markets, I have no doubt at all that London's cabbies have already solved most of the problems.