“Regenerative Marketing: Lessons Learned from Italian Business” – Enrico Foglia, Christian Sarkar, and Philip Kotler
Six of the top ten longest running family-run enterprises in the world are Italian.
The oldest of these is Fonderie Pontificie Marinelli (founded in 1000) – is still in operation in Agnone, a small Italian town of 5,200 inhabitants in the province of Isernia in Molise. The product? Bells. Granted the honor of using the Papal Coat of Arms in 1924 by Pope Pio XI, the world’s oldest foundry still makes bells using the ancient technique know as “lost-wax casting” and its bells are used across the globe, from New York to Beijing, Jerusalem, and South American.
What is it that makes Italian companies resilient? Is it the family-owned aspect? The vision of the founder? Is it the cultural and socio-political landscape of the Italian city-states? These are questions we are trying to answer, as part of a series of research initiatives with the Regenerative Marketing Institute. Our goal is to understand the traditional and contemporary factors for business longevity and resilience, and to develop a practical framework for regenerative marketing.
What is Regenerative Marketing?
Regenerative marketing is defined as marketing practices which nurture communities and build local prosperity over the long term. The outcomes of regenerative marketing include value creation for customers, employees, and local communities. Regenerative marketing practices must – by definition – build community wealth.
Preliminary research findings from Italy suggest the following positive characteristics:
- The Founding Mission: the business has kept its founding spirit alive, often rejuvenated by the current leadership
- Leading with Trust: the company is built on trust-based architectures and business models
- Commitment to Community: the enterprise has deep local roots and is designed to improve community wellbeing
- Imagination-driven Innovation: the business builds unique, differentiated products
- Time-Equity: the institution invests in building customer and community intimacy and puts in the time to create deep connections
- Cultural Traditions: the company balances traditions and “family” values with competitive pressures
- Collaboration Platforms: the company builds a community-centric platform for creating community value (see this dialogue between Nathan Schneider and Simone Cicero)
- Multi-generational Loyalty: employees and their families have a life-long relationship with the business, often over multiple generations
- Customer Focus: customer relationships are built on deep trust, not exploitation
- Local Funding: Financial support from local based banks and financial institutions tightly connected with the local community so that access to the credit is easier thanks to long term personal relationships.
- Local Circular Economy: supplier, partners, consultants are chosen among local community creating a common vision where the success of the company is shared with community stakeholders
- Local Sustainability: great attention to local environmental practices where most of the time the founders and his/her family reside
Some of the shortcomings of regenerative companies include:
- Finance: lack of access to impact/engage big institutional/international investors interested in long-view investments
- Digitalization: many, though not all, are lagging in their implementation of digital strategies
- Gender inequality: the glass ceiling is real and an obstacle to company performance
- Branding: weak marketing and branding acumen is often combined with an inability to see what is required to expand beyond existing markets
Regenerative Marketing is Community Trust
Cliched as it may sound, regenerative marketing is built on local, “deep trust.”
Here’s how to picture the difference:
The traditional “go-to-market” approach we’ve used for the past 100 years is about building a product and taking it to market based on a customer value-proposition. Because the business is built on the volume of its transactions, the business does not focus on long-term community relationships. In fact, it is often at odds with community aspirations, and must play “nice” by being a good corporate citizen – via CSR and public relations.
Regenerative marketing, on the other hand is all about deep trust. It begins (and ends) with the company’s relationship with the local community. In fact, the business may even be community-owned. This creates a new domain for value creation ignored by traditional b-school thinking: “community value creation.”
Thus, our agenda for exploration covers the obvious questions:
- How does a business build community trust?
- What prevents us from building deep trust?
- How do we maintain deep trust over the years?
- What breaks deep trust?
- Is trust local or global?
- What are the requirements for implementing regenerative marketing strategies?
- What makes regenerative marketing profitable?
It also seeks to uncover the “patterns of practice” at the edge:
- What new methods and models are emerging in the community space?
- What can we learn from existing businesses that are succeeding?
- What can start-ups do to engage the community and build deep trust?
- What can large companies do to become respected community members?
- How does business move from collaboration and co-creation to co-ownership with the community?
- What hybrid business models allow for public and private value co-creation?
- Does community deep-trust scale at world-wide?
STAY TUNED for the next in a series of articles which will reveal more of our findings, and highlight cases of regenerative marketing from our research.
The image used above is from the Buondonno winery – producers of Michelangelo’s favorite wine. It is part of one of the first organic producers associations to be born in Italy.