Marketing - The Marketing Concept

Mortein swats its staff and heads offshore

Stuart Washington.

A well-known star of the Australian small screen, notorious for his poor
personal habits, received his last rites during the week. To be fair,
Louie the Fly has been biting the dust regularly since he first appeared
in 1957. But Tuesday's announcement was a different kind of demise the end of Louie's reputation as a knockabout Australian.
The closure of the West Ryde factory that manufactures the fly spray
Mortein, and the loss of 190 jobs, earned the scrofulous character a
resoundingly vehement response on his Facebook page. ''Wow nice
going Mortein! Using an ad campaign to cover the fact that you're
taking more Aussie jobs overseas!'' was representative of the
reception for Mortein and its London parent, Reckitt Benckiser.
The state secretary of the Australian Manufacturing Workers' Union,
Tim Ayres, took umbrage at the closure without warning and the
company's continuing advertising campaign, which seeks participation through Facebook about whether Louie
the Fly should live or die (reading this week's responses is a quick lesson about the perils of social media).
''While they were out there attempting to breathe life into Louie the Fly they were secretly planning to close the
Australian operations,'' he said. ''I think people are entitled to be cynical about advertising campaigns that
claim to be an iconic Australian brand but are manufactured overseas.''
But Phil McDonald, the managing director of George Patterson Y&R, the agency that famously came up with
the Louie the Fly campaign, questioned whether consumers cared. ''They [Reckitt Benckiser] won't have a
worry that their product is made overseas,'' he said. ''How many brands have their products manufactured
overseas?
It's a different world and customers understand that, particularly with low-consideration products like fly spray
or margarine or biscuits.'' That said, Reckictt Benchiser has a household presence in Australian culture with
Over 90% of Australians recognise Louie and know the Louie the Fly jingle, both of which are associated with
the Mortein brand
With its closure announcement, Reckitt Benckiser was the latest in a series of withdrawals and cuts by
manufacturers. The challenge Reckitt Benckiser faced was a global business that is building big factories near
big populations and close to the supplies needed for its products such as Air Wick, ''aveagoodweekend''
Aerogard, Dettol, Harpic and Nurofen.
Reckitt Benckiser's chief executive, Lindsay Forrest, said in a statement: ''Australia's geographical distance
from other markets and our relatively small domestic market has made it increasingly difficult to embed our
West Ryde operations into these global arrangements.'' Translated: Australia is too small, too far away and
too difficult. Reckitt Benckiser is hardly alone in its retreat. Last month it was Toyota cutting 350 jobs. On
Wednesday it was Holden announcing 100 job cuts. And last year BlueScope Steel declared 1000 jobs were
going.
Looked at through the lens of household goods, Mortein is the latest candidate for the ''where are they now?''
of Australian products either made offshore or owned by foreign interests. A quick roll call of buyouts in recent
years: CSR, now Sucrogen, is owned by Singapore's Wilmar International; Foster's is owned by South African
brewer SABMiller; and Dairy Farmers is owned by a division of Japanese brewer Kirin.

Marketing - The Marketing Concept

And it is probably a fair bet they will not be the last, as manufacturers deal with the changed conditions
brought about by an Australian dollar staying relentlessly above $US1 - imports are cheap, Australian exports
are expensive and Australian companies are cheap for overseas buyers
Read more: http://www.smh.com.au/business/newsmaker-louie-the-fly-20120203-1qxi9.html#ixzz1lXlRzJJ9

QUESTIONS
1) How many years has Mortein been using the Louie the Fly marketing campaign?

2) Define a parent company? Where is Morteins parent company located?

3) Recount the main issues in this article.

4) Examine the interactions between the four key business functions that led to Morteins decision to
move offshore.
Key Function

Decisions and interaction with other key functions

Finance

Operations

Human Resources

Marketing

5) Assess if Morteins marketing concept has failed.