As we begin our countdown to the 2007 Annual Conference, I wanted to continue the tradition (which I began last year) of blogging my conversations with some of the key conference speakers. These virtual Q&A sessions will highlight some thoughts from their conference presentations as well as provide their ideas on this year’s theme – Transforming the Marketing Landscape.
My first guest this year is Bob Lachky, evp and chief creative officer of Anheuser-Busch. Below, please find our conversation on how the marketing landscape has changed as well as how Anheuser Busch created a culture that embraces taking risks to gain rewards.
1. The theme of this year's ANA Annual conference is 'Transforming the Marketing Landscape.' What have you done this year to transform your own brand's landscape?
We are in the midst of a major landscape transformation as we have doubled the size of our brand portfolio over the past year. Through acquisitions, distribution agreements, and new brand development we have set ourselves and our distributors up for future growth, especially with new high-margin products. It is requiring an in-depth look at brand roles and zero-based marketing allocation, but we'll be better off in the long run because we'll have competitive brands for every segment of our industry.
2. What has been the biggest transformation that you think the industry has recently undergone? What do you think the next transformation is going to be?
The industry has seen two major things happen recently and both are good. First, consolidation has occurred at both the supplier and distributor level and this has helped improve general efficiencies. Second, there has been heady growth at the high end of our industry through crafts, specialties, and higher margin products, and this has helped raise the image of beer and increase the varieties and styles available. This is key in protecting (and growing) beer's overall share versus wine and hard liquor.
3. Without risk there is no reward. How do you figure out what risks are worth taking?
Risks aren't risks if you do your homework and trust your instincts. Any planning process should include a thorough assessment of the market situation, the changing consumer, the competition, etc., but at some point you have to act. Today's economy is moving at warp speed and you have to stay a step ahead. If you're afraid of risk, you lose.
4. Also, how have you created the culture at Anheuser Busch to create risk, especially risk not many marketers are willing to take?
August Busch IV is the best leader we could have. If you do your homework, weigh the pros and cons, and act quickly, he will always support you. I have many examples we can point to where August backed the team when we were under a lot of pressure. For example, before the Budweiser Whassup campaign became a global hit, we were running into a lot of resistance during the early stages.
Many consumers (and even some of our distributors) simply didn't get the concept, and questioned whether it was a smart move for the brand. The pressure to drop Whassup became intense. August told us to stay the course and ride the storm out. He was right, and very quickly the campaign was validated by internet parodies and general buzz and word of mouth. A year later Whassup was recognized as the world's best advertising at Cannes.
A-B is a well-managed company and always has been. But I believe our greatest moments are when we take bold, unexpected actions that really demonstrate our leadership. If we continue to follow that approach, we will always have a culture that develops great marketing.
Would be interested to learn at the ANA Conference about what industries Bob Lachky considers as those to observe that have experienced similar changes before (consolidation, growth at the high end). They seem to be familiar patterns of competition and industry changes and what works and what not works can probably can be discerned from other companies or industries experiences.
Posted by: Erich Joachimsthaler | September 24, 2007 at 12:09 AM