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BOOK REVIEW: “Drucker on Marketing” by William Cohen
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BOOK REVIEW: “Drucker on Marketing” by William
Cohen
March 16, 2016
It’s not surprising that Philip Kotler, the “father of modern marketing,” calls Peter Drucker the “grandfather
of modern marketing.”
That’s because the Peter Drucker’s ideas still influence all aspects of business
to this very day. If you pick up the latest business bestseller, there’s a good
chance that the ideas being discussed originated somewhere in the work of
Peter Drucker. To remind you of Drucker’s influence, here are his infamous
The Five Most Important Questions You Will Ever Ask About Your Organization:
1. What is our mission?
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2. Who is our customer?
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3. What does our customer value?
4. What are our results?
5. What is our plan?
In Drucker on Marketing, William Cohen, a former student, has sifted through Drucker’s huge body of
work, singled out his most salient ideas on marketing, and constructed them into a framework that not only
outlines Drucker’s marketing philosophy but provides practical advice on how to achieve marketing goals in
today’s business setting. For Drucker, profitability should not be the main focus of a business. The
customer should be; the market should be. He didn’t consider marketing as one of many tools to generate
profits. Rather, he viewed marketing as the driving force of business, a philosophy for defining and
capturing the most enriching customer opportunities.
I’ve chosen nine ideas that should convince you to read the entire book. This is not standard practice for
book reviews, but in this case, every idea is worth reading – and more significantly – employing!
“The Purpose of Business is Not to Make a Profit.”
For Peter Drucker, the purpose of business is “to create a customer.” Regardless of whether your
business is a for-profit or not-for-profit, we must understand that while profit is essential to support
innovation and marketing actions, profit maximization is “not only not the primary purpose of a
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BOOK REVIEW: “Drucker on Marketing” by William Cohen
business,” but it could be detrimental to society, and dangerous to the organization’s health. A recent
column by Steve Denning points out that “maximizing shareholder value” is the “dumbest idea in the
world.”
“Any Organization Has Only Two Functions: One Concerns Marketing, and the Other is
Marketing.”
Drucker wrote early on that because the purpose of business is to create a customer, the business
enterprise has two basic functions: marketing and innovation. For Drucker, marketing and innovation
produce results; all the rest are costs. Why is innovation so important? Because without innovation,
you can’t convince a prospect to buy from you rather than a competitor. And how is innovation related
to marketing? Because making a decision concerning what innovation to invest your time, money and
effort in is part of marketing.
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“Good Selling can be Adversarial to Good Marketing.”
Selling has to do with persuading a prospect to buy something you have. Marketing has to do with
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product” is adversarial to marketing when a different profitable product could be sold in greater
“The Power of Superconsumers” –
quantities with less effort. Drucker liked to say that “if marketing were done perfectly, selling would be
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unnecessary.” He took on the orthodoxy by recommending that sales and marketing activities should
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not necessarily be organizationally integrated.
“Zoom Out/Zoom In – Making It Personal” –
“Marketing Isn’t Sales.”
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Drucker used the example of a sales manager being made marketing vice president. For Drucker, the
skills, experience, education, and even the personalities of the two jobs are different. The salesperson
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influences the customer to buy what the organization has produced, while the marketer finds out what
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the customer wants and influences the organization to produce it. Drucker’s “marketing view” is based
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on four major instructions to executives: (1) market marketing to all internal organizations at all levels,
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(2) understand the difference between sales and marketing, (3) educate and lead, and (4) approach the
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business from the customer’s point of view.
Watson, and Wolfgang Knorr
“Marketing is Leadership.”
“The allure of the ad-lib: New research
Drucker used to make the point that good leadership is essentially marketing. The first principle of
leadership (and marketing) is to maintain absolute integrity. Without integrity, there is no way to
succeed in the long term. There’s a section here that goes over eight principles of leadership that is
identifies why people prefer spontaneity
in entertainment” – Jacqueline Rifkin and
Katherine Du
worth the price of the book.
“The Best Way to Predict the Future is to Create It.”
Drucker famously once explained how he was able to predict the future: “It’s easy. I listen – to myself. I
simply look out the window and report what I see and what events that have already occurred mean for
CATEGORIES
the future. This simple step of describing the obvious result of previous occurrences gives some the
impression that I am predicting the future. The reality is that I am merely stating the obvious. Most
Advertising
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never even look out the window to see what has occurred, or if they do, they don’t invest the time to
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think much about the obvious outcome of these events.”Drucker realized that a company must answer
four questions to plan for the future:
1. What opportunities does the company want to pursue, and what risks is it willing and able to accept?
2. What are the scope and structure of the organization’s strategy, including the right balance among such
aspects as specialization, diversification, and integration?
3. What are considered acceptable trade-offs for a company between time and money and between in-
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house execution and using a merger, acquisition, joint venture, or some external means to reach its
objectives and attain its goals?
4. What is the organizational structure appropriate to the company’s economic realities, the opportunities,
and its performance expectations? Surprisingly, and I’m sure you’ll agree, most companies have not
fully answered these four questions. Drucker’s secret is that you don’t predict success, you create it.
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“Success by Abandonment of Profitable Products.”
Drucker’s concept of abandonment emphasizes the logic that an organization must be prepared to
abandon everything it does at the same time that it must devote itself to creating the new. Thus,
abandonment must be executed along with continuous improvement, exploitation of past successes,
and innovation. Drucker insisted that every three years an organization should “challenge every
product, every service, every policy, every distribution channel with the question, if we were not in it
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BOOK REVIEW: “Drucker on Marketing” by William Cohen
already, would we be doing it now?” Furthermore, Drucker emphasized that if the answer to the
Customer Engagement
question was “no,” then the reaction must always be “what are we to do now?” Drucker demanded
Customer Experience
action. Drucker’s test for abandonment was if any of these three conditions exist:
Dark Marketing
1. If a product, service, process, still has “a few good years left”
Decision Making
2. If the only argument for keeping it is that is “fully written off”
3. If a new candidate is being stunted or neglected because an old, declining product (or service) is being
Design
maintained.
Digital Marketing
“Drucker’s 5 Deadly Marketing Sins.”
Ecosystems & Platforms
Astoundingly, Drucker presents us with these 5 marketing sins (most of which are common practice):
Ethics
(1) seeking high profit margins and premium pricing, (2) charging what the market will bear, (3) using
Go to Market
cost-driven pricing, (4) focusing on past winners, and (5) giving problems priority over opportunities.
Clearly, Drucker’s view presages Clay Christensen’s principle of “disruptive innovation” by showing
Innovation
that seeking high profit and premium pricing inevitably leaves the door open for the competition.
Internet of Things
“Why Buying Customers Won’t Work.”
Drucker identified several ways of buying customers, none of them recommended by him despite their
Jobs-to-be-Done
popularity in the marketing community. He was not talking about low pricing based on what the
Leadership
customer considers value, but rather low price a “bribe” to get the customer to buy. Drucker also made
another important point: “bribes intended to buy customers attracted few, if any, new customers.”
Manipulation
Marketers (and salespeople) would do well to learn this lesson.
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The book has many more examples of Drucker’s marketing insights, and is worth reading slowly. In an
age of analytics and data, we must not forget strategy. Reading Bill Cohen’s Drucker on Marketing is a
Meaning
good first step.
Metrics & Outcomes
Jenny Cheung is a freelance marketer and project manager based in Texas.
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