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Marketing trends in the 1990s.

As we look at casting marketing, we see five strong trends evident for the 1990s: increased use of forward market planning; more involvement by top management in the marketing process; adoption of systems in all aspects of marketing; better coordination, direction and control over line marketing activities; and emphasis on target marketing.

Foundry managers have come to realize that marketing means much more than just selling: it means research and analysis, planning, promotion, intelligent pricing policies and a multitude of other elements--including sales. Foundries with good marketing plans also look well beyond their immediate customer base, realizing that future casting demand depends, to a large extent, on the needs of your customer's customers.

Not too many years ago, sales methods were more important than marketing methods in our industry. Even in times of serious recession, it usually was possible to get some new business if you could sell harder or cut the price. Market planning and attendant target marketing were virtually unknown. And the attitude of "We'll make it--you just sell it" was common among foundry managers.

As the industry became more competitive and attrition escalated while overall domestic demand declined, a new approach was clearly needed: identifying and aiming sales efforts toward "target" markets. Ask yourself, "What kind of castings does the market need that we can make at a profit? If this involves revision of facilities or elevating technology levels, will these investments pay off? And if so, over what period of time?"

Few foundries were started by salespeople. Most were founded by people with technical and mechanical skills. As the business grew, the manager became adept at selecting customers and building solid relationships. In reality, he was the foundry, wearing the many hats required in the entrepreneurial setting of a small company. He knew his foundry's strengths and weaknesses, understanding well what it could and could not do. Frequently, he exercised a sound marketing approach, without really realizing it.

With growth, though, the manager now devoted less and less time to contacting customers, listening to their problems and figuring out ways to help them. From that point on, sales success depended on the ability to get the same kind of knowledgeable approach from salespeople, sales engineers or manufacturer's agents.

As a natural result, many managers became preoccupied with production, equipment and processes. Not being as close to the market as before, they were not able to exercise the same level of informed judgment that had served them so well in the past. The result: the boss became progressively less marketing-oriented.

Focus on Marketing

If this profile fits your foundry, what can you do about it? First, step back and re-evaluate your objectives, resources and marketing potentials. Next, develop a detailed marketing plan that establishes solid sales and profit objectives five years out, together with specific programs and actions to accomplish these goals. Analyze where your customers and markets are going and what segments you can and should be serving, and at what levels of profitability. How well equipped are you to compete? What about new processes and new markets? What should your target markets be?

The primary role of top management in modern casting marketing should be to exert a positive, supportive and controlling force upon overall marketing strategy and performance, but not get involved in the day-to-day operations and decisions.

Actually, salespeople have to carry the marketing ball in a small company. But to be effective, they must understand the broader picture of where the foundry's business is and where it should be going. Salespeople constantly face customers and are getting direct, personal reactions to a foundry's performance in the marketplace. Listen to them. Don't automatically assume that negative feedback is just excuse-making for apparently substandard performance. Most salespeople are genuinely concerned with their customers' problems. And the better they understand the customers' viewpoint, the better for the foundry.

Your salespeople constitute a key link with market reality: they can bring the customer's thinking and needs into focus with the foundry's marketing plan. To rely on production people, who think in terms of production problems, to come up with sound market planning is wishful thinking. Production cannot fulfill market needs if it is not in close contact with the market. Nor can marketing people function effectively unless they know production's problems and appreciate what the foundry can profitably produce for the market.

Even though foundries now face unprecedented levels of price-cutting, shrinking demand, foreign sourcing, and buyer ignorance and indifference, these negative factors can themselves create marketing opportunities. Someone has to make the $21 billion worth of castings produced in this country every year.

Better market planning and good, effective programs like target marketing can help make sure your foundry gets its share of the business.
COPYRIGHT 1992 American Foundry Society, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:marketing tips for the foundry manager
Author:Warden, T. Jerry
Publication:Modern Casting
Date:May 1, 1992
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