WHO CARES AND WHO MATTERS:

THE 4C'S STAKEHOLDERS ANALYSIS

by Freddy J. Nager
Updated 17 January 2014

When making business plans, you need to consider all the people and organizations who might affect it or be
affected by it. These are your "stakeholders." Don't confuse that word with "stockholders" or "shareholders";
stakeholders include everyone who might have a "stake" in the outcome of your actions, not just investors. For
easy memorization, the stakeholders are categorized in a framework called "The 4C's":

• Customers
• Competitors
• Company
• Community

(Note: the 4C's Stakeholders Analysis is not the same as the 4C's Marketing Mix of Professor Don E. Schultz.)
The 4C's Stakeholders Analysis is based on the 3C's Model of Dr. Kenichi Ohmae, a senior partner at McKinsey
& Company. His corporate strategies drew on corporation, customer, and competitor analyses. Subsequent
marketers expanded Ohmae's model to integrate community stakeholders, such as government regulators, the
news media, unions, and other interest groups. Some marketers have added other C's, such as Context,
Collaborators, and Complements, but all these may be included in your Community analysis.

Let's now address each of the categories:

Customers

Generally speaking, a customer is anyone who purchases or uses your product. (You may also call this group
"consumers" for B-to-C operations, or "clients" for B-to-B operations.) For nonprofit organizations, customers can
include the beneficiaries of the services, or the donors who provide financial and other support. Here are a few
complexities to consider:

• First, the end user of your product is not always the one who makes the purchasing decision. For
example, parents obviously make purchases for their children — you wouldn't advertise diapers to a
baby. And students buy textbooks because a professor requires them to do so; hence, textbook
companies market to professors, not students. That said, some end users can influence the purchaser:
children get parents to buy them toys, for example. Also, in the cases of media properties supported by
advertising (such as Facebook), the customers may include both the end users and the advertisers.

• Second, the customers you target might not be the ones who ultimately buy your product. For
example, Toyota created the Scion brand for Americans under age 30, but the average age of Scion
buyers turned out to be 39. Scion's youth oriented-marketing ironically appealed to older buyers who want
to feel young — and who want Toyota-made cars at an entry-level price.

• Third, the customers you have might not be the customers you want. Your company might be
serving small businesses, but you would prefer to serve Fortune 500 corporations. Or you have a
nightclub and want to attract more women and fewer men to your events. Consequently, you should
research the needs of your prospective customers, not just your current customers.

Important Note: Understanding your customers is critical, but don't let your customers tell you what to do.
Customers often don't know what they want, they're frequently wrong, or their actions don't reflect their words.
Rather, you should understand their needs, habits, behaviors, pain points, and motivations so you can create
strategic campaigns that influence their ultimate decisions.

Marketing Plan Tip: Describe your current customers. Who are they, what is their value (express in terms of
population and purchasing power), and how do they make their purchasing decisions? Be sure to provide
qualitative insights and quantitative data. Most importantly, try to explain what your customers want or need. Also,
do you have more than one target segment? Are there targets you want but don't have?
 Freddy J. Nager "Who Cares and Who Matters: The 4C's Stakeholder Analysis": 2

Competitors

A competitor is any product (or service) that can substitute for your product in meeting a customer need. For
example, Coke's direct competitor is Pepsi, but numerous indirect competitors also quench thirst, such as bottled
water, fruit juice, and energy drinks. That's why Coca-Cola corporation has products in all those categories.

You should also try to predict where surprise competitors might come from — they don't always come from your
industry. Did the traditional record stores ever foresee Apple's iTunes destroying their market and taking their
customers? Did Encyclopedia Britannica ever imagine Wikipedia destroying their business?

Also keep in mind that EVERYTHING has competition, since everything competes for the limited time and
attention of your customers. The competition for an MBA program, for example, might be someone's family
demands, job, or social life.

A final note: marketers strive to make their companies different from the competition. If everything we do matches
our competitors, then our customers will base their choices on who has the lowest price, and only one company
usually wins a price war. Differentiation can make the market – and your company – richer.

Important Note: Competition is not always over sales. Companies might compete for employees, supplies,
publicity, investors, real estate, or anything else they need to operate and succeed. In that sense, the competitor
for a nonprofit organization could actually be a for-profit organization if they both want the same thing.

Marketing Plan Tip: List your primary competitors, analyze their strengths and weaknesses, and describe their
marketing activities. How will you react to their strengths and weaknesses? How will you make sure you are
different and/or better than they are? Be sure to also consider indirect and future competitors.

Company

Your marketing campaign must fit the competencies and interests of your company's internal stakeholders:

• employees
• executives
• major investors

If you are a marketing agency or consultant, then the "Company" is usually your client.

In most cases, you need to sell your marketing plan to internal stakeholders before launching it publicly. The
diversity of interests makes pleasing everyone impossible: for example, cutting worker wages might please
investors but anger employees. Still, knowledge of what matters to your company stakeholders will help you
shape and sell your plan.

• Their Values: Will your marketing reflect their moral preferences or offend them? For example, many
marketers use sexual imagery to sell products. That might be appropriate for some companies, but for
others, a sexual marketing campaign could compel some employees and investors to leave, and senior
executives to condemn your decisions (or even fire you).

• Their Needs: Investors and top executives favor anything that boosts the value of a company's shares.
Consequently, they might demand short-term growth, which would force you to minimize investments in
long-term programs, charitable policies, or worker benefits. Or an executive really wants to win a creative
award, compelling you to be even more imaginative with your campaign.

• Their Competencies: You need to consider the strengths and weaknesses of your company and its
internal stakeholders. For example, if your CEO is politically well-connected, that should be factored into
your campaign. However, if she is afraid of public speaking, then having her give a presentation at a
conference is not a great idea.

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 Freddy J. Nager "Who Cares and Who Matters: The 4C's Stakeholder Analysis": 3

Important Note: Beyond analyzing internal stakeholders, be sure to understand your company's brand, position,
mission, and vision so that whatever you do supports them. In addition, determine if your company has the
resources (tech, human, and financial) to support your plan. It's critical to be objective in all these analyses.

Marketing Plan Tip: Identify your key internal stakeholders and how this plan might affect or involve them. Who
are they and what are their needs? How will your marketing strategy affect your company's brand? What
resources does your company have to support this plan? Be specific about your company's stakeholders — do
not base your plan on generalizations about workers, investors, or executives around the world.

Community

The wider community can significantly affect a marketing plan. This community includes:

• government officials at home and in your target market

Since customers and competitors already have their own category in the 4C's, do NOT include them in your
Community analysis.

• Complements: A complement is a product that causes an increase in demand for your product. For
example, software and hardware are complementary products, since the purchase of one inspires the
purchase of the other. Here's a simple rule of thumb:
o If sales of Product A cause sales of Product B to INCREASE, they are complements.
o If sales of Product A cause sales of Product B to DECREASE, they are competitors.

• Collaborators: These are other companies — not your customers — that help your company succeed.
Collaborators do not have to be in your industry: many interesting cross-promotions exist between two
companies in entirely different industries. For-profit companies often collaborate with nonprofit companies
to enhance their brands and appeal to the nonprofit's devoted following.

Try to predict how these community stakeholders will perceive and receive your actions. What do they want or
need? What do they have the potential to do?

This doesn't mean you should try to please everyone; indeed, a little controversy can actually boost business. For
example, the Austrian government's tight regulations forced Red Bull to launch a new product category, which
created interest in other countries. This proves that a clever marketer can turn a regulation into an advantage.

Important Note: In today's world, the community transcends borders. Recently, an Australian commercial for
Snicker's was retracted after Americans saw it on YouTube and protested what appeared to be gay-bashing.

Marketing Plan Tip: Which members of your community could influence the outcome of your plan, or will be
affected by it? In addition to considering potential problems with outsiders, consider who you can partner with to
support your marketing and business initiatives. In this social media era, it's particularly valuable to have
relationships with journalists, bloggers, celebrities, and other influential people.

Conclusion

Many different stakeholders can shape a marketing plan and affect its performance. That's why some strategies
work only for a certain situation at a certain time with a certain set of stakeholders. What works in New York might
not work in New Delhi. The key is not to rely on "best practices," but to analyze all the variables and possibilities
within the 4C's, then to develop the plan that’s right for you.