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How International Marketing Is Helping One Defense Contractor Thrive

Defense contractors looking to balance out declining defense budgets are diversifying their product portfolios and going overseas. Here's one example.

 Textron Marketing

Sometimes I think I'm the only person writing about defense contractor marketing. But I'm not - the chatter is increasing as marketing becomes more important to defense contractors. So much so that I'm seeing more and more articles about the subject.

The Advocate newspaper from Baton Rouge recently did a story (linked below) about how a local subsidiary of defense contractor Textron took an uncharacteristically entrepreneurial approach, diversified its product line and is now successfully finding overseas customers for its products.

In the article by Kathy Finn, Booz Allen partner Randy Starr (co-leader of the firm's aerospace and defense and national security sectors) explains the significance of what Textron has done:

Big [defense] contractors won’t take the same kind of risks in terms of investing in a new product or technology the way a commercial company might ... If you make a wrong bet, it can be very costly if the military decides not to invest in what you’ve developed.

Starr thinks this move by Textron might be a harbinger of the industry's future as declining defense budgets could produce a defense industry with a more commercial orientation.

I think we’ll see a higher proportion of companies that have a small focus on the military market and a big focus on the commercial side.

And that is why marketing is becoming more important to defense contractors.

For many defense contractors, marketing is mistakenly associated only with high-profile tactics such as advertising and public relations.

In fact, marketing is much more than just promotional tactics.  One paradigm for understanding the holistic role of marketing is  “the 4 P’s of marketing.”

Popularized and widely used since the 1960′s, the 4 P’s are: Product, Price, Place and Promotion:

  • Product – what is the product?  Is it tangible or intangible? How is it different from what competitors are currently offering? When a product improvement is made in response to competitive pressures or customer demands, that is a marketing decision.
  • Price – do you have premium pricing or do you compete on low price, attempting to make your margins on volume (generally a losing proposition, long-term).  Pricing is one of the most crucial marketing considerations.
  • Place – how is your product sold – in a geographic area, via the Internet? Internationally? Do you have in-house sales and distribution or do you rely on channel partners? How do your competitors distribute their product?
  • Promotion – This is the most visible form of marketing and includes a growing number of tactics available to marketers.  However, it’s not advisable to do any promotion until the product, price and place are determined.

Click below to read the full Advance article.

douglasburdett
douglasburdett
The Principal and Founder of Artillery, Douglas Burdett is a former artillery officer and Madison Avenue ad man. He also hosts The Marketing Book Podcast, where he interviews authors every week about the latest in modern marketing and sales.

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