Professor Philip Kotler has been described as the father of modern marketing and is considered as a value creator in many different fields, including economics, marketing and management. He has published more than 80 books and 170 journal articles. He has also received many awards, including the Leader in Marketing Thought Award from the American Marketing Association, the 2021 Lifetime Contribution Award from the US International Management Consulting (IMC), and the Lifetime Achievement Award from the RISE World Summit.
Professor Kotler is ranked as the leading guru in management in Global Gurus ranking. He is also the founder of the World Marketing Summit, which is held annually and invites international leaders to speak about various specific subjects of interest.
Fatiha Boukouyen: Professor Kotler, why have you specialized in marketing?
Philip Kotler: You know, I did not start specializing in marketing, I was originally a specialist in economics, which is a larger field. I specialized in economics because I was interested in income distribution and why too many people are poor, and why so few people are rich. So, it was a sense of social injustice that led me into economics. When I started economics, I realized that I could learn a lot from the marketplace, and how people choose their goods and services. I also realized that the economists have two simple models of understanding the marketplace. They think that all consumers are rational. We know that when you go to a supermarket, you’re going to buy some candy and other things that you did not expect to buy. Maybe 80% of our behaviour might be emotional. So, I rejected the idea of the rational man. I also think that the economists use price mainly as the influence on behaviour, which is so ridiculous when we are influenced by advertising or by salespeople. So, I moved into marketing thinking that there is a deserving need for economic thinking. Later on, I realized that economic thinking is not enough for marketing, you need social science, sociology, social psychology, and so on. So, I ended up in marketing because I thought that it would enlighten me about human behaviour in the marketplace, how people are motivated, how they spend their time living, and how they choose their goods and services.
Fatiha Boukouyen: Did you have a specific marketing idol that encouraged you to work in marketing?
Philip Kotler: My real idol in marketing is not a marketer but he is a grandfather of marketing, and that is Peter Drucker, who was the father of management. In that role, he also had the most interesting insights into marketing. So, Drucker is my hero. I have a great respect for many other marketers who have done many great things.
Fatiha Boukouyen: You talk about Peter Drucker in your autobiography, which is so insightful, how you met him, and the questions he asked when consulting a company. He talked about creating customer value, which has evolved since we are now talking about value creation in general.
Philip Kotler: Drucker actually possessed a sort of definition of marketing which says that it is the ability to create customers. He did not use the word value at that time but it makes sense to believe that is what he meant because you cannot get customers just by asking them to be customers. You get them because you are offering comparably better value than they can get from another supplier.
Fatiha Boukouyen: Which is better, being a researcher or being a practitioner?
Philip Kotler: I think that they really go together. Researchers will be better researchers if they do some practice in the field. How will they know customers except by meeting and talking to them. So, practice must fit into research. I also believe that research is really valuable when it is done right and it will make practitioners better.
Fatiha Boukouyen: For researchers and practitioners like Chief Marketing Officers (CMOs), what are the tools that they have to master to improve marketing and research?
Philip Kotler: We say that there is a marketing mix of tools that you can use to reach your target market. Professor Neil Borden at Harvard once said that there are 12 tools. Fortunately, we boiled them down to be four big tools: Product, Price, Place, and Promotion. I have thought about this again in my new sixteenth edition of Marketing Management. I refined the marketing mix from four to seven tools that influence customers. Certainly, one is Product, I would like to take service out of product and treat it as a separate tool.
I would also add Brand as a separate tool. I would keep Price but I would add Incentives. Price is what is established but around the Price we might say ‘buy today and we will give you two for the Price of one’ or we may say ‘today only the price is cut in half’.
So, incentives should be separated as a tool from price. And then there is Communication, which we formerly called Promotion. And finally, the big one is Distribution which we used to call Place. So, my seven tools of the marketing mix are as follows:
Product
Service
Brand
Price
Incentives
Communication
Distribution
Fatiha Boukouyen: It is interesting to have this holistic view of the toolkit that marketers, practitioners, and researchers have to use to make a better marketing.
Philip Kotler: Every company has to choose the marketing mix that they want. I am not saying that everyone has to use the seven marketing mix tools. I can imagine a company adding a few additional tools.
Fatiha Boukouyen: Is marketing complicated today with all of the environmental changes and technological tools that appeared recently?
Philip Kotler: New things happen to complicate marketing further. Right now with climate change, we hope that companies will add sustainability in their marketing mix. Of course, profits remain the major goal. Coronavirus disease-2019 is still operating and I know a lot of people who still wear masks and they do not attend inside events. We also find customers polarizing into two groups with opposite political opinions. They hardly talk to each other. Companies have to be careful in deciding who to please.
Fatiha Boukouyen: As a value creator, how do you define the concept of value creation?
Philip Kotler: Good marketing practice always aims to be customer-oriented. The need is to understand what is value to the customer. It is not what is value to the company. Some customers prize low prices, other prize higher quality or quick delivery. The company need to decide which value or value mix to go after. I am also asking whether we need to create a field called value creation rather than marketing? No, I do not think so. This would confuse students. The intrinsic purpose of marketing is value creation.
Fatiha Boukouyen: Why is it important to investigate the field of value creation?
Philip Kotler: I know that there have been conferences run by Gautam (Mahajan) and others on value creation with many papers on the subject and new insights. Yet I do not see the need for a whole new field called value creation. It would only duplicate what we do in marketing.
Fatiha Boukouyen: Is there a new name for value creation since marketing and other fields are evolving?
Philip Kotler: I cannot think of a new name but I am very open-minded. If someone starts a new field called value creation, I will watch it eagerly to see whether it succeeds or fails. The final proof comes in getting and keeping enough people who want to be in this separate field.
Fatiha Boukouyen: There is only the ‘co’ that was added to creation to mention the value co-creation.
Philip Kotler: Value co-creation is an interesting idea. Why not get the customers to help in the creation of the product or service. The Lego company is a major practitioner of value co-creation. Harley Davidson is another practitioner who invite customers to give new ideas to the company. And Starbucks made a big pitch recently to encourage customer ideas.
Fatiha Boukouyen: How important is creating value in marketing, in management, and in life in general?
Philip Kotler: Value creation goes beyond the marketing field. For example, take a young man who wants to attract a particular woman to marry him. What he does is to not only look good and be interesting and show a strong interest in her and her life. He is approaching this as a value creation project. You can also use the term for politicians. A politician is promising to support certain issues that will appeal to their target audience. So, value is a very broad term that could be used far beyond marketing.
Fatiha Boukouyen: Yes, it is an interesting and important concept that could be used in every area and field.
Philip Kotler: Yes, but it is not recognized as such. If you ask someone ‘are you a value creator?’, well they may be a little puzzled and want you to reword the question. So, while it applies everywhere, it does not mean that it is practiced consciously everywhere.
Fatiha Boukouyen: What can practitioners and researchers do to avoid value destruction?
Philip Kotler: Gautam Mahajan did a good job in his article on value destruction. When a company reduces the size of its candy bar, it may save a little money but it might also lose a lot of customers. That would be an example of value destruction. The same value destruction would occur if the company appears to raise its price excessively. The company would do better by offering its product at two levels of price and charging more for the larger offer.
Fatiha Boukouyen: Do you think that we need a degree in value creation, like a Master’s in value creation instead of an MBA?
Philip Kotler: I think that this would be risky. Most people understand what an MBA is. They do not know what a degree in value creation means or is worth in the market. To say that you have a degree in value creation but there is no organization. There are MBAs all over the world but there are no value-creation people around the world. My advice to any student is to get the MBA.
Fatiha Boukouyen: What is your advice for a consultant in value creation?
Philip Kotler: If you ask me if it makes sense to have a conference on value creation, my answer is yes. It will be useful to have good papers written and shared with an audience. But if a person says that he can consult me on value creation, I would asking him what is his training. Is it in psychology or marketing or what?
Fatiha Boukouyen: What is your opinion about the Creating Value Alliance that focuses on developing the field of value creation and what can Creating Value Alliance members do to make creating value more global?
Philip Kotler: It is nice that a group of people have decided to join with others in an alliance. They need a marketing plan to accomplish their goals. Otherwise, it will not go anywhere. To go anywhere, it has to be a large-scale movement with a plan.
Fatiha Boukouyen: What is your message for value creators’ specialists, marketers, and researchers?
Philip Kotler: Value creation is a very good idea. It is a fundamental idea to marketing and it applies to many other fields of human behaviour. What I need to know is what is the course structure that qualifies a person to establish that he or she is a skilled value creator.
Fatiha Boukouyen: Professor Kotler, thank you so much for sharing your thoughts with us.
