Too much, too quick – a tale of CMOs, brand and myopia
Marketers face real pressure to deliver real results in real time. But where does this leave long-term brand building? Josh Loh speaks with Troy McKinna, who’s revisiting the true role of great marketing.
Today, the world of business has reached a dizzying pace. Seduced by fast metrics and driven by technology and an ever-present fear of disruption, organisations have grown obsessed with short-term results. And brands are suffering.
Troy McKinna set out to help marketers get back to the job of building brands faster and better than the competition. In his book Brand Hustle: four critical foundations to accelerate brand growth, he explores moves by Mars, Schweppes, Holden and more, to uncover the hits and misses of brand building.
Josh Loh: You speak a lot about marketers today having to do more with less, being forced to focus on short-term results and losing sight of brand value. Where does this problem originate?
Troy McKinna: Business is speeding up, which I think is a big part of the problem. Business is getting really fast and technology is disrupting pretty much every brand and category. What you find in most industries, as well, is that you’ve got big players, but then you’ve got little startups that are chasing the opportunities a lot faster than a big startup can move. Everyone’s on the back foot to respond to that. Part of it as well, is that businesses are a lot more – and this is a big generalisation – financially driven these days. You see a lot more CFO backgrounds behind leaders in CEO roles.
Brands are treated as intangible assets. If you build your own brand in-house, you can’t actually place much value of it on the balance sheet. It’s not a valued asset within the business. Most functions within a business are really focused on this quarter and this year. In my experience, in meetings, it is very much ‘what is the result that we are delivering right now?’ Whereas a lot of brand metrics will benefit in the long term.
You can spend money on advertising this year, but you’re still getting benefits from it next year and the year after. Whereas today, most investments are promotionally driven, deliver results right here and now and not in the long term. Because not many people in business are looking at the long term, it’s not valuable.
In the book you discuss the hangover effect of marketing teams throwing everything and the kitchen sink to meet this year’s budget, without much regard to what’s happening next year. In a nutshell, what is your advice for marketers struggling to find time to think about the bigger picture?
I think the biggest challenge marketing has is that it’s trying to do too much. There are lots of new media channels and new ways to do stuff. I see a lot of companies trying to do it all. But I see the really successful ones are really focused on a couple of media channels. They’re really clear on their brand strategy and where they’re heading.
My hope in the book is that the first part of it really sets up a definition of what marketing does – which is build brand value – and that marketers need to be clear on where they’re taking the brand, with the four critical foundations, so they can make fast decisions. You can see a lot of decision making takes a long time in business, but if you’re really clear on where the brand’s going you can make that decision a lot quicker. It’s partly being able to respond to stuff quicker, but it’s [also] being really clear on what you do and don’t do with your budgets – and your brand, essentially.
Where have you found that marketers stumble the most in building brand and telling brand stories?
I wonder if there’s not enough clarity on what drives a brand, on the real core consumer insights that they’re delivering against. A lot of places, particularly consulting agencies, will say that they have lots of insight, but really they’ve just got lots of data and they’ve got lots of segmentations – lots of the ‘what’ is going on. But they don’t really have the ‘why’ things are happening. Why are consumers behaving in the way they do? They don’t know, so they’re not really clear on what they’re building for. As I’ve said, you get a lot of startups coming through; there are lots of new entrants into the market. So businesses just try to respond by copying.
They’re doing stuff, a lot of stuff, but without the clarity of why it’s important and why it’s going to move the dial. It’s easy to get distracted by all the tactical things that happen within marketing, but it’s important to understand the strategic ‘why’; why it’s important.
There’s definitely a sense that marketing was great 20 years ago and the advertising world was great, with lots of budgets and big teams. You can definitely see it in the FMCG industry, where there used to be a team of three or four working on a brand, but now in some places there might just be one person. That one person might be looking after a few brands now; people are stretched a lot thinner. What comes out of that is, well, if you don’t have good foundations and training for the next generation coming through, it’ll just be assistant brand managers and brand managers as they work their way up.
So there’s lots of factors going on. I guess my overall thought would be marketers are getting distracted trying to do too many things and not really focusing on strategic direction or having great clarity on why what they’re doing is important.
You say marketing is the action of growing brands. Do you believe CMOs in Australia have a big enough seat at the boardroom table? What do you say to those agnostic to brand as a driving force of business success?
The CMO role is losing its voice. In a lot of companies you’ll see it’s being merged with sales roles, or the chief commercial officer or maybe it’s getting confused with chief customer officer.
There are lots of different roles, but I think why building brand base is so important is it’s a central point that brings everything together. It connects your business with your customer. It connects all your product strategy with your communication strategy. The danger has been that the role has really fragmented.
You see tech companies, for example, where the chief information officer might be doing parts of the product strategy that once would have sat with marketing. It’s a lot harder for a CMO, now, to have enough control over the real true brand levers. A lot of places you see marketing turning into just the advertising function, which is not really the true calling of the brand.
Why I’m big on brand? I love Warren Buffet’s work. A lot of his message is ‘how do you build a moat around your business to protect it?’ Unless you’ve got patents or a monopoly on the industry, the only true way to protect it is the brand. Customers have a choice and they’re making really fast decisions; they’re using the brand as the shortcut. How you get chosen over your competitors is the key driver for that. It helps connect the business and the consumer face.
Businesses that are growing fast, that really have their brand strategy in order, lots of them are pushing behind that strategy in the same direction. And it works.
Do you see the CMO role, as we understand it today, dying? Is it the most dangerous one around?
The stats show that the tenures are getting shorter. Here, the US, the UK, everywhere it’s the same. The CMO role tenure is getting shorter and it tends to be the shortest of all the C-suite roles. It’s a high pressure role. As I’ve said, lots of the business depends on the strength of the brand. But it’s also the hot spot if things aren’t going well – it’s easy to scapegoat the CMO. I think Woolworths went through a year of changing CMOs within a single 12-month period. You can see the business really struggle on the back of that.
Was there a moment or a piece of wisdom that you encountered when putting together the book that subverted your understanding of marketing or brand?
I’ve spent a lot of time working with Mars and also Schweppes, working on the Ehrenberg Bass principles of building brands around light buyers and just how much you share your customers with your competitor’s brand.
I think the biggest thing that changed over the course of writing the book was discovered chatting to brands like Four Pillars, Nike and Oakley. There’s a point at which you can actually be too big and too broad. You start to lose sight of what you truly stand for. And what that does is it opens up the market for someone to come in and do it better. One of my big learnings from a brand like Schweppes – a huge brand, been around for a long time – it has really become too reliant now on the high volume grocers like Woolworths. Lots of price-driven activity, it’s losing sight of its core DNA which is great mixing with the best bartenders. That has allowed for a brand like Fever Tree to come in underneath it and start to really poach the best bars and clubs in Australia, and around the world for that matter.
That’s my biggest learning: ‘how do you balance the need for growth and the importance of light buyers with the really targeted and core consumer base?’ The best brands have found a way to do both. You can definitely grow a brand by chasing light buyers and we’ve done that a lot over the years.
Everyone knows they should be doing long-term brand building. At the start of it, I thought ‘there’s two different books here’. One is the fundamentals of building a brand for the long term, but the real problem we need to address as an industry is ‘how does marketing deliver short-term outcomes while still delivering in the long term?’ That’s what inspired Brand Hustle.
There’s a need for marketing to speed up and that doesn’t mean becoming more promotionally and tactically driven, it means doing strategic stuff, but doing stuff that delivers in the long term. That comes back to doing great product innovation and service innovation that helps build the brand in the long term but also delivers the short-term results.
How do you find sales channels that give you a sales number but also help nourish the brand? How do you do promotional campaign activities that fit within this 24/7 media cycle, but also help build the credentials and attributes of the brands long term?
That’s my key message, the need to find ways to do faster stuff that also has a strategic intent behind it.
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Image credit:David Travis