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Lateral Marketing: New Techniques for Finding Breakthrough Ideas

Lateral Marketing: New Techniques for Finding Breakthrough Ideas

by Philip Kotler, Fernando Trias De Bes
A revolutionary new system for generating the next big marketing ideas and opportunities
According to Philip Kotler, the widely acknowledged "father" of modern marketing, and Fernando Trias de Bes the marketing techniques pioneered in the 1960s and '70s have worked too well. Fierce competition among products with little or nothing to distinguish one from another,


A revolutionary new system for generating the next big marketing ideas and opportunities
According to Philip Kotler, the widely acknowledged "father" of modern marketing, and Fernando Trias de Bes the marketing techniques pioneered in the 1960s and '70s have worked too well. Fierce competition among products with little or nothing to distinguish one from another, along with modern product positioning and targeted marketing techniques, have led to increasing market segmentation. If the trend continues, individual market segments soon will be too small to be profitable. In Lateral Marketing, Kotler and Trias de Bes unveil a revolutionary new model to help readers expand beyond vertical segmentation and generate fresh marketing ideas and opportunities.
Philip Kotler (Chicago, IL) is the S. C. Johnson & Son Distinguished Professor of International Marketing at Northwestern University's Kellogg School of Management. Fernando Trias de Bes (Barcelona, Spain) is the founder of Salvetti & Llombart whose clients include Pepsico, Sony, Hewlett-Packard, Nestlé, Credit Suisse, and other top corporations.

Editorial Reviews

From the Publisher
“…He is challenging the conventions; coaching marketers to broaden our horizons; delivering a new set of solutions; thinking the unthinkable…” (Interactive Marketing, Vol 5, No 4, April/June 2004)

These two marketing innovators provide effective and practical concepts and tools to help readers create new products and services based on thinking across rather than within markets. Understand the power of marketing creativity and how "lateral marketing" can expand thinking and profits. (Best Business Books 2003, Library Journal, March 15, 2004)

Soundview Executive Book Summaries
In a consumer economy saturated with homogenous products and inhabited by customers who are more and more immune to advertising messages, traditional vertical marketing - with its emphasis on market segmentation and brand proliferation - is failing us. But, according to Northwest University's Philip Kotler and international marketing expert Fernando Trias de Bes, there is a better way to reach consumers, to create innovative products and markets that don't yet exist and to gain a real competitive advantage. This way is through an entirely different way of thinking: lateral marketing. The authors explain that lateral marketing complements traditional marketing by providing an alternative route to generating fresh new ideas.

Whereas vertical marketing helps us find increasingly smaller subgroups for which a product might be developed, the authors explain that lateral marketing lets marketers develop an entirely new product that finds a much wider audience. Instead of accepting that your product or service will have a small share of a saturated market, you will find yourself the leader in new markets - reaping the rich rewards of being the first or second in creates.

The authors write that lateral marketing is a work process which, when applied to existing products or services, produces innovative new products and services that cover needs, uses, situations or targets not currently covered. As a result, lateral marketing leads to new categories or markets.

The lateral marketing process is a creative one. Creative thinking follows three simple steps:

  1. Select a focus. This will be a product or service.
  2. Make a lateral displacement for generating a stimulus. A lateral displacement is an interruption in the middle of a logical thought sequence.
  3. Make a connection.

Here is an example. Let's take "flowers" as our product focus. A logical thought sequence about flowers is the fact that "flowers die." A lateral displacement of that sequence is "flowers that never die." Then we make connections between the new concept and the original focus. In this case, that would involve asking ourselves under what circumstances will a flower never die? If a flower is made of cloth, silk or plastic, then it would never die. We have found a new concept: "artificial flower." This is creativity. Innovations are a result of connecting two ideas that have no apparent or immediate connection.

If you want to apply lateral marketing, the authors explain, it is essential for you to understand each step. If you are thinking about the focus, you must be prepared to generate a displacement. If you are thinking about a possible displacement, they write, you have to be aware you are generating a stimulus for later use. And if you are working on a movement for making a connection, you have to be aware that you are working on changing your stimulus to make it logical.

Applying the process to real life, the authors explain that this is how it would work. First, choose a product or service you market. Creative thinking works from the bottom up, from the concrete to the general. It is inductive, not deductive. Make sure it is one where you have difficulty competing.

Once you have chosen a product or service, break it into pieces using the scheme of vertical marketing. You will then be able to see the whole picture.

According to the authors, the basis of lateral marketing is creating a gap. If there is no gap, there is no lateral marketing. A gap exists only if it requires you to jump. But this is hard to do, because we have been trained to think logically. You are thinking laterally if you are thinking about substituting, inverting, combining, exaggerating, eliminating or reordering your product or service.

To successfully implement lateral marketing, the authors write, you must understand the underlying principles, summarized here:

  • Companies need to innovate if they are to grow and prosper.
  • An excessively high percentage of new products fail (80 percent of consumer goods and 40 percent of business goods) in spite of careful market research and planning. The reasons for the innovation crisis lie in the traditional innovation process.
  • Most new products offer just a specialized version of something already on the market, such as a new flavor, size or package. This is segmentation or vertical thinking.
  • Repeated application of vertical thinking results in a hyperfragmented market so that few niches remain that are big enough to yield profit.
  • Marketers need a complementary way of thinking up new products or services that will lead to new categories or markets. This strategy is lateral thinking and although it carries greater risks, the rewards are also greater.
  • Lateral marketing thinking uses a distinct framework and processes that can be taught to anyone, can become a part of an innovative company's culture, and can be used in conjunction with vertical marketing.
  • Lateral marketing thinking might occur spontaneously or consciously. It requires putting together ideas. If you can get everyone to think laterally, you will create a company full of innovative market creators. Copyright © 2003 Soundview Executive Book Summaries

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Meet the Author

PHILIP KOTLER is the S. C. Johnson Distinguished Professor of International Marketing at Northwestern University’s Kellogg School of Management. Considered the father of modern marketing, he is the author of twenty-five books, including Marketing Insights from A to Z, also available from Wiley. He has worked as a consultant to corporations such as IBM, Bank of America, General Electric, and AT&T.

FERNANDO TRIAS de BES is founder and Partner of Salvetti & Llombart, a firm specializing in consulting and market research with an international scope and clients such as PepsiCo, Sony, Hewlett-Packard, McKinsey & Co., Nestlé, and Dannon. He is also a consultant on innovation in marketing. He is an Associate Professor of the Marketing Department at ESADE Business School in Barcelona.

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