The chairman of the Marketing Institute, JP Donnelly, is keenly aware marketing professionals have not succeeded in taking the business centre stage, writes Bernice Harrison.

Marketing people have never been the best at promoting their own business. It's something that JP Donnelly, newly elected chairman of the Marketing Institute, is particularly aware of.

Putting marketing at the core of his clients' business is something he tackles in his day job as managing director of the Dublin office of Ogilvy & Mather Worldwide.

Marketing often appears to be intangible, he says, largely because there is a misunderstanding of what it involves. "Smaller and new companies often confuse advertising with marketing. They look at a glossy 30-second advertisement on television and they say 'that's far too expensive for us' so they figure that marketing isn't for them."

The fault, Mr Donnelly acknowledges, is not entirely with budding entrepreneurs agonising over bottom-line figures while trying to get a business off the ground. Too often, marketing professionals have not been able to demonstrate how a marketing-oriented approach to business ultimately creates a sustainable business.

Glossy television campaigns may be the in-your-face side of the profession but the trend is away from such campaigns towards customer relationship building, as well as spending on promotional, niche targeted and direct marketing.

"If you sit down with consumers, you can tease it out and you can actually develop a business and a business model that is sustainable," says Mr Donnelly. He points out that marketing looks at a particular product or service and sees what can make it different, make it stand out in a crowded product sector.

So far, so textbook but, as chairman of the institute, Mr Donnelly's task is to look behind the day-to-day job of marketing and to try to put it in the overall business context.

As he sees it, "marketing should be to Ireland what banking is to Switzerland".

For a soft-spoken man whose conversation is happily free of the jargon that characterises so much marketing speak, this sort of analogy appears to stray uncomfortably into adman's sloganeering.

He admits it does not bear too literal an interpretation but was intended to highlight the concept of using intellectual capital as a business driver. "I feel that, for too long, we have been trying to compete in a variety of different ways with other economies of the world," he says, "and it is probably not sustainable for us to be a manufacturing economy or call-centre economy where we are probably providing low-cost highly educated people to service business."

In this scenario, he believes the real sustainable capital is our intellectual capital and this gives business in Ireland the opportunity to be marketing-led and intelligent.

When Mr Donnelly was studying for a BComm in UCD in the early 1980s, marketing was a small component of a degree that mostly turned out accountants.

He came up through the advertising ranks in the traditional way, starting out in the despatch department in Peter Owens, making tea and working through stints in McConnells, Dimension as well as Edelman and Young & Rubicam in New York. Along the way he took a year out to do an MBA.

The starting point for would-be marketing professionals is radically different now, with nearly all third-level colleges offering marketing courses. The Marketing Institute, with 4,000 members, is one of the largest professional bodies in the State and offers a range of its own courses.

Mr Donnelly estimates that there are 100,000 small and medium-sized businesses in the State but only a couple of hundred have marketing departments. The number that see marketing as central to their business development would number only a few thousand.

"Huge amounts of business are still either technology-led or sales- led and they are really so curtailed by their bureaucracies that they are not being purely customer-focused," he says. There are, he admits, several examples of world-class marketing in Ireland such as Baileys, Waterford Glass, Kerry and Golden Vale, but the real challenge is to work with the thousands of SMEs that are so busy being technology or engineering-led that they look upon marketing as something they may be able to afford one day, if the business grows.

Mr Donnelly takes over at the Marketing Institute at a time when marketing budgets are being slashed. This is clear from the downturn in advertising, the contraction in sponsorships and the fall-off in the amounts companies are prepared to spend.

For someone who heads up an advertising agency and who obviously has a vested interest in encouraging clients to spend, Mr Donnelly is sanguine and philosophical about the downward trend. Cuts in marketing spend are dispiriting, he agrees, but it's more dispiriting to see marketing budgets that are viewed as a discretionary cost.

"Spend is not necessarily a reflection of good marketing, though it helps," he says, in a weary tone that suggests he's been part of more than one budget-slashing meeting this year. "But if the cuts are being made in the context of a company that puts marketing at the centre of the way it practises its business, then I'm comfortable with that.

"If they are looking at it in silos and saying 'there's the marketing department, cut that spend', then they are not actually investing in their business in the right way."

He talks of empowering marketing departments but, in a globalised economy, decisions affecting marketing in Ireland are frequently taken in London. It is now not unusual for accounts to move from one advertising agency to another in Dublin not because of any failure on the part of the agency but because of a London- prompted global alignment.

"Some multinational organisations have literally treated Ireland as part of another region and a third-tier level at that, and they are pursuing an economy of scale or rather a false economy of scale," he says.

He points out that there are a lot of multinational companies in Ireland saying there is a value in the business that they have here and the capability. They are investing in marketing and the traffic is going the other way. He cites as an example his own client, GSK, which has the Lucozade brand, and former client Vodafone, both of whose success in Ireland has led to the marketing strategies and advertising campaigns developed here being used in other markets.

"That's an example of being able to successfully export our thinking," he says.

"The real issue is the dearth of innovation," says Mr Donnelly. Rather than relying solely on the technology route to come up with innovation, he advocates a market- led approach.

"The consumer will reward you if your innovation is right, the customer will pay you and you'll build a sustainable business," he says. "My job now is to get the marketing agenda up on the high ground."