ANA Marketing Maestros

Charles Schwab: Turning Crisis into opportunity

By: Ryan Anderson, Starwood Hotels and Resorts

As the financial markets eroded steeply in the second half of 2008, consumer behavior changed quickly and marketing executives had to reassess business priorities and plan their response to plummeting revenues. While many would expect brands in the financial services sector to go radio silent, Becky Saeger, EVP and CMO of The Charles Schwab Corporation, focused on turning crisis into opportunity.

Going well beyond crisis management, Schwab would recommit to their purpose of helping people be financially fit, despite the uncertainty of these economic times. While consumer involvement is typically very low for Schwab, “suddenly involvement shot up like a rocket” said Saeger. “This gave us the unique opportunity to engage with our clients.” She shared the following guideposts for campaign development on their path to growth:

Focus on what you can control. Schwab couldn’t control that over 100 banks had failed. That investor sentiment was dropping over 35%. That interest rates falling to virtually zero. What could be controlled was every point of contact in the arsenal to provide products and support to help clients and prospects through these times.

Constantly monitor corporate reputation and consumer sentiment. As the financial crisis evolved, it was important to understand what the consumer was doing and thinking so that communication could be adjusted accordingly, responding assertively when appropriate.

Be nimble and responsive in real-time.  “Reprioritize everyday and execute like crazy” said Saeger. Attitudes and behaviors changed with every piece of market news, so Schwab’s messaging needed to be in tune with the current sensibilities of their prospects and clients.

These tenants drove the successful evolution of Charles Schwab’s “Talk to Chuck” campaign during a fragile financial era – recognizing their net promoter score at all time high and attrition score at an all time low. Despite the results of this well-laid approach, Ms. Saeger closed with the reminder that sometimes the consumer does not know what she wants. I couldn’t agree more. There is no doubt that the consumer is in control and that we need to be highly responsive in order to succeed. That said, we must remember that an essential part of our job as marketers is to identify our consumers’ latent needs through insight and address them by delivering innovative products, services and messages from our brands.

What are you doing to address your consumer’s latent needs in these trying times?
 

IBM: To the Edge of the Abyss… and Back

By: Geoffrey Precourt, Warc

As seen at: http://www.warc.com/ConferenceBlogs/ANA-112009.asp

The timeline - as expressed through a series of Fortune magazine covers - tells the story of the last quarter-century of IBM sharply and succinctly. In 1984, the company was recognized as one of the world’s “most admired” brands. Eight years later, in 1992, it had become a “dinosaur.” But, by 2004, it was on the rebound. Although the editors of Fortune would not commit to a complete recovery, they were willing to ask. “Can IBM Get Smart Again?”

"We learned a hard lesson,” said Diane Brink, IBM vp/marketing/global technology services. “We were near extinction. And we had an acute need for leadership… to redefine what our business meant in terms of service to others.”

The leadership came with the arrival of Louis V. Gerstner, Jr. in 1993. And, with marketing helping him drive the enterprise, IBM’s transitioned from what Brink called “a company that sold components” to a “company that sold business solutions” - from a provider of hardware to a provider of consulting services.

As a company on the edge of disaster, Brink told delegates that IBM “had lost focus on our clients and our industry. But we survived that near-death experience. It was sobering. But we went through a series of inventions, constantly redefining who we are.”
 
Where IBM ended up was in a “smarter place,” with  “clearer value to clients, and increased profitability,” Brink said. “We successfully remixed our portfolio, with 80 percent [of our business becoming] software and services that meet the needs of our clients.”

Performance metrics stand witness to the transformation. According to Brink, IBM experienced record revenue, profit, earnings per share, and cash flow at the end of 2008 - steady growth that, she added, has continued through the third quarter of 2009.

The company that had brought the world the PC, barcodes, and a massive amount of research on the human genome had refocused its efforts on a connection between business and humanity. And it had done so well in advance of its 100th anniversary on June 15, 2011.

Inside IBM, leadership embraced the cultural changes that would lead to increased value for IBM clients. For integrated marketing - the company’s largest business unit - that challenge translated to a three-point program, as articulated by Brink:

• “Focus on value”: Drill down on the company’s core clients, do more with less, and ensure that there’s a premium placed on value and innovation.
  
• “Embrace and exploit opportunities”: Be aggressive in the pursuit of opportunities and new strategic partnerships.
  
• “Act with speed”: Empower managers with capability and the culture to embrace change while transparently managing risk.”

“Our leaders, businesses and institutions have the opportunity to change the way the world works by focusing on these three things,” said Brink.

“The world is smaller and flatter,” she continued. “But being able to connect is just not enough. Our planet also is becoming smarter. We have the ability to apply intelligence to challenges and ambitions - to just about everything. We can build a case for changing progress, challenging the status quo, and creating new value for ourselves and for clients. Great things are possible if we bring a new level of intelligence to how the world works, how everyday systems interact. It’s a chance to do better, to be efficient.

IBM’s vision of a “smarter” planet includes instrumented people, interconnected companies and institutions, as well as intelligent combinations of man-made artefacts and nature’s systems. To achieve it, Brink explained, will require “back-end systems to leverage data and analytics to create real-time insights.”

And its applications will include fields as diverse as health-care management, transportation and infrastructure, water management, and oversight that includes the authenticity of pharmaceutical offerings as well as the security of currency exchanges.

To connect with so many diverse perspectives, IBM is relying on a strong digital presence.

“Just about a year ago, we started a rich conversation with the world,” Brink said. “Now is the time to fuse intelligence into literally everything to change the way the world works. With intelligence, we all will live and work better, in all sizes of institutions and in all kinds of organizations. Businesses require intelligence to make safer decisions.”

And IBM, she added, will be the service provider, even though its role will be less immediately visible: “No one really sees our logo any more. Our logo isn’t seen. But the substantiation of our mission - to create a smaller planet, to reflect global realities - is not just what we talk about. It’s what we are. Essentially, it’s all around us. It affects each of our lives…. We’re leveraging everything we have to be relevant, to have real-time conversations all over the world.

The marketing effort in support of the broad-based effort reaches throughout the corporation, from advertising to its client centers, recruiting, media relations, event-marketing, social media, business partners, employees and alumni. “We’re listening efficiently in real time,” Burke explained. “We need to speak to many different audiences, to convey who the brand is. [We’re talking] in new and innovative ways to C-suite managers as well as college students. We’re on LinkedIn, Facebook. Blogger, Tumblr, and Twitter. We want everybody involved in our conversations.

“Employees understand the role they have. For prospective employees, and our clients, we help them understand [our culture of] deep know-how, of being innovators, of embracing deep forms of discovery.”

And, in terms of turning the IBM brand around, she added, “We collaborate to think, to make the remarkable possible. There are no problems too big to solve. When everybody thinks, everybody wins.

“The key precondition for real change now exists. A period of discontinuity is a period of opportunity for those with courage and vision. We’ve established a point-of-view. The ‘smarter planet’ is relevant and gaining momentum. It’s who we are. It’s what we do.”

 

THE KODAK GROWTH MOMENT – OVERHAULING AN ICON

BY BOB SIEGAL, PRAGER AND FENTON LLP

I write this blog post while sitting in the Phoenix Hospital ER, waiting for an orthopedic surgeon to treat my crippled hand.

OK, I’ll be honest - I’m really writing this while sitting poolside at the Marriott, sipping a Mojito desperately trying to self-medicate while trying to write this blog entry using the frozen claw that my right hand has become. However, if I had a lick of sense I would be in the ER.

Jeffrey Hayzlett took the stage this morning allegedly to give the above referenced presentation.  If the ANA were being accurate however his presentation would have been titled; “PITY THE POOR FOOL WHO HAS TO TAKE ACCURATE ENOUGH NOTES TO WRITE THE BLOG ON THIS PRESENTATION” – which would be me.

I cannot remember the last time I heard someone relay so much quality information, so quickly in such an entertaining fashion. So there I am writing away like some scribe on crack trying to capture all of Mr. Hayzlett’s musings when my hand completely seized. But I suppose I am getting ahead of myself – let’s turn the clock back a few hours…

So here is Kodak, king of an analog technology and a product line that has essentially become obsolete who along the way also created and owns a lifestyle concept and cultural icon - “the Kodak moment” - that is now entirely an entirely digital activity. What is a giant corporation facing extinction to do?

Kodak’s solution as to hire Mr. Hayzlett, who is undoubtedly the first CMO in American business to be engaged and given the mandate (recorded on video for all to see) by the company’s CEO to “Create Tension Inside the Company” (given this charge, perhaps he should change his title to Chief Tension Creation Officer) while reframing Kodak’s marketing department from an organization that sold a product – film - into a digital force selling Emotional Technology.

We learned a lot in his short presentation –

• Kodak holds 25,000 patents in digital technology
• 70% of Kodak’s revenue comes from digital products
• 2/3 of its income is from outside the US
• The majority of its business is from B to B NOT B to C.

Go figure.

We also learned of the Hayzlett proximity rule – “don’t make eye contact with him or you WILL get an assignment to do something”

We also learned about the transformation process and the underlying Kodak philosophies towards their business:

• People don’t take pictures, they capture memories, moments.
• The real Kodak moment is sharing our moments.

And my favorite:

• My memories are what make me, me. Its only when I share them that I become complete.

There was much, much more content; details on the transformation process, funny stories about bypassing the corporate infrastructure to make things happen quickly and efficiently, the emotional connection to consumers, being willing to put yourself out there to do what you know is right. But, the thing is it took me all afternoon to write this so I need to stop. If you want to see the rest of the story, the outcome of this work in progress, a stop at Kodak.com might not be a bad way to start.

 

 

 

Name Your Own Job Title: Yes There is a Method to the Madness

By: Darlene Abubakar, Amtrak

Method Products, Inc. manufactures and distributes household cleaning products and Eric Ryan, the company’s Chief Brand Architect and Co-founder, indicated that Method is a challenger brand, foolish enough to go up against not one or two but seven goliaths in the category – companies so big that he would love to just have their toilet paper budget to support his marketing efforts. 

Marketing budget aside, Eric believes strongly that the most successful marketing efforts work from the inside out – starting with employees because the brand must first live in the mind of the employees.  And as such, the HR Director is really your Marketing Director, he stated.  He added that they do cross functional interviews and prospective employees receive a homework assignment – “How would you keep Method weird?” This approach allows them to feel the chemistry of the candidates and their approach to the brand.  Once hired, employees establish their own job title.

Mr. Ryan believes that companies need to elevate work to a higher place – put something out that is bigger than them.   He also challenges the “old” organization structure and indicated that marketing needs to “look more like us.” There must be two way conversations with engagement and participation.  Don’t build a brand around a brand promise – a single idea, but around a brand philosophy – a singular cultural idea.  Create products worth talking about and continue to challenge the norms.  Eric stated “The soul can not be outsourced” bring creative in house so you can respond quickly. To maintain a creative approach, they have an open office space to encourage dialogue among employees.  They also, place all creative, no matter what stage, on what they refer to as Wiki-walls so that any employee may comment or add to the concept.

“People against dirty” is their brand philosophy and the company believes that you should know what’s in your home care products.  Most people don’t think about the chemicals in their cleaning products, but Method is supporting The Household Product Liability Act, a bill currently under consideration by congress that would require that all ingredients be listed.  He shared with us a video – “Shiny Suds” that will be launched in a couple of weeks – it’s funny and makes a strong statement about who is sharing our bathtubs with us.  It will be going viral so check it out and share with your friends.

My last words - whether you are a start-up or a traditional “legacy” company, I ask the question “is there a method to your madness?”

Google: Green or Red Stripe?

By Ryan Anderson, Starwood Hotels and Resorts Worldwide, Inc.
 
The ANA has devised a clever system to the badges provided to each attendee at the Annual Conference. As is typical of most conferences, these 3x4 cards provide your name and the company you represent. This creates an interesting social scenario whereby most of us do a face-chest-face evaluation throughout the daily procession. Largely this is done out of curiosity, but in some instances this is a tactic used to predetermine the worth of a potential conversation.
 
The clever part comes with their color-coding system. If your badge has a green stripe, this means you are an ANA member or staff person. If your badge has a red stripe, this means you are vendor or sponsor. By providing this simple visual clue, we are able to easily identify who are the buyers and who are the sellers in this advertising ecosystem.
 
The reason I share this fact is because when Eric Schmidt, chairman and CEO of Google, spoke at today’s general session, I was curious what color badge he received at registration (though he probably didn’t stand in queue). On one hand, Google was just ranked #7 in Interbrand’s Best Global Brands 2009 and has shown year over year increases in ad spending. So one could surely state “green.” On the other hand, Google earned ad revenues in the area of $21 billion in 2008, so one could just as easily state “red.”

Early on in his speech, Schmidt said matter-of-factly that Google is in the advertising business – that 97-98% of revenue comes from advertising, mostly in the right margin of search results. But later in the Q&A session, he discussed being in the information business – needing to innovate as fast as possible, seizing the opportunities ahead to provide consumers with the best access to this “information explosion” we’re all encountering. “If Google doesn’t seize those opportunities, someone else will” said Schmidt.

This green/red debate reminded me of Chris Anderson’s book, Free: The Future of a Radical Price, where he contends that the most effective price is no price at all. Now free doesn’t mean profitless, it just means that the route from product to revenue is indirect. In Google’s case, they are providing an amazingly effective product (information) that happens to be free to the consumer, where their indirect (and profitable) route to revenue is advertising.

I’m not sure if the ANA staff has printed any, but I think the stripe on Google badges should be some color in between green and red…perhaps brown (the unfortunate mixture of these two colors).

For additional coverage of Schmidt's speech, check out New York Times reporter Stuart Elliot's blog post here.

MillerCoors CMO: “Growth is Overflowing”

By Bob Siegal, Prager & Fenton

Listening and watching Mr. England’s presentation this morning I was struck by the notion that the ANA may just have to institute a policy that prohibits beer marketers from speaking at future conferences. This proposed ban is not based on any issues I have with beer, the legitimacy of the companies’ corporate messages or the content of their marketer’s speeches. Rather, it speaks to the unfair advantage beer marketers have over the rest of us. Simply put, Mr. England could have been reciting nursery rhymes in French, but as long as he kept showing those great ads he had the audience in the palm of his hand.

In truth, Mr, England shared a lot of terrific content with the highly engaged audience – one just had to dismiss the entertaining ads and pay attention to fully appreciate it. Even the title of his presentation was disarming; Dude why are you drinking that? Although at first it seemed cute and perhaps overly simplistic, Mr. England revealed that in many ways this question – and the consumer’s response to it was actually a core concept that drove their marketing effort. The beer consumer wants to have the “right” answer to that question for his friends, for any women he might encounter but especially for himself.

He spoke about the motivators that do and don’t drive the beer purchase decision:

• Sensibility
• Fun
• Status
• Savoring
• Contentment
• Independence

Or as his boss has put it when pressed as to why people consume their product; “Its enables me to be the ‘me’ I want to be.”

But beyond understanding of the consumer’s mindset, Mr. England spoke to need to identify the core positioning concept and execute in all manner of approach and media. More than simply deciding on Rocky Mountain Cold Refreshment as a slogan, he reinforced the need to execute the RMCR message and iconography at all touch-points; equity advertising, innovations, Hispanic, sponsorships, POS, internet and social networking.

He also had some advice for the those who wanted to be a successful CMO;

• Own the P & L
• Be the Sales Person
• Understand the impact of what you do on the supply chain
• Be famous for benefit – driven innovation
• Cherish great people (on your marketing staff)

Mr. England summed up his major take-away as “Be famous for benefit driven innovation”

Personally I was struck by an earlier discussion he had on the various ways they position and reinforce the notion of Coors as a ‘Work Reward’. Not taking anything away from Mr. England or MillerCoors, I couldn’t help but think how fortunate we all are not to that we are lucky enough to work in an industry where we don’t need a ‘work reward’ although a nice frosty Coors sounds pretty good to me right now.

 

 

Stephen Quinn, CMO of Walmart, Shares Their Customer-Centric POV

By Lesley Neadel, CooperKatz

Stephen Quinn of Walmart kicked off the presentations of the 2009 ANA Annual Conference.  He described Walmart’s current main objective: to sharply focus on their customers, something that the organization had stopped doing.   Quinn warned, “If you’re not organizing around the customer, you are at risk as a company.  He spoke from experience. “We lost our way,” said Quinn, “and it was as simple as focusing on our customers to get us back on track.” 

The idea at the brand’s center from its inception was to lower the cost of living for people.  Yet, five years ago, the brand got confused, as the nation was trending towards mass affluence.  Showcasing ads that he admitted he was not proud of, Quinn said they were attempting to find a way for Walmart to play into that trend. 

This has all changed now, as Quinn proclaimed that Walmart is proudly focused back on their lower prices – and he unapologetically told the crowd that if the ads didn’t speak to them, they probably aren’t in their target audience. 

Their customers are price-sensitive, but looking for a variety of items, and of course good quality.  Walmart strives to provide a one-stop shop for all of these things, and judging from a video that had their employees reading letters from customers, they are succeeding.  These were powerful letters, describing how Walmart has affected their lives in profound and meaningful ways.  They credited Walmart with keeping them from going off of the deep end, and being able to feed their children and teach them about shopping for value. 

Quinn then talked about the paycheck cycle – something that has been much more recognizable this year, vs. last.  Walmart notices a huge surge in purchases at the beginning of the month, and less so but still noticeably mid-month.  It is so radical that on the last day of the month, in the final 12 hours of that day, sales are down 10-20% from the prior year.  Then, at midnight, once the 1^st of the month paychecks hit, Walmart sees a surge in business of 200-300% from the prior year. People flood to the store to buy diapers, formula and food. 

Walmart provides real solutions for so many families in America – and Quinn told the audience that he strives to provide real, tangible solutions for them all.

McDonald’s – I’m Loving Growth: CMO “discusses every color but green”

By Darlene Abubakar, Amtrak

It’s tough to grow a brand during a major recession, but McDonald’s is thriving during these tough times.  How are they doing it?  This was Neil Golden’s topic of discussion at the ANA annual conference general session this morning.  He is Chief marketing office at McDonald’s and his presentation focused on how leading their marketing efforts with ethnic insights is having a major impact on their growth.

It’s easy to imagine that McDonald’s was always the leading fast serve restaurant; nationally and even globally, but according to Mr. Golden, in 2002 sales were down and their marketing campaigns were primarily short term – disconnected incentive based promotions. The problem - the company was focused on themselves rather than the consumer.

Then in 2003, they launched their “I’m Loving it Campaign” globally and began the process of reinvigorating and modernizing the brand.  He indicated that this is their longest running campaign and today it enjoys 100% brand recognition and association.  They now focus their efforts on the consumer, with particular emphasis on the ethnic consumer.  Mr. Golden reminded us that 30% of the population is Hispanic, African American and Asian and these are the fastest growing segments of the populations. He added that they apply ethnic insights thought all points of the marketing process and understanding and listening to multicultural audiences has given McDonald’s a huge competitive advantage.

Beginning with focus groups, separate testing is conducted with Hispanic, Asian, African American and General markets consumers,  multiple targeted agencies develop two year marketing  plans for each segment, culturally relevant insights are incorporated into creative and media and event sponsorships are targeted with multicultural consumers in mind. Mr. Golden stressed the need to develop compelling, ethnic inspired messaging that generates an emotional connection with multicultural audiences. He also reminded the audience that ethnic consumer segments are leading lifestyle trends. 

When asked the question, “how do you get your company to focus on multicultural segments when budgets are tight?”, Mr. Golden replied, “you will notice that the only color that I did not talk about was green.” He added that with Hispanics, African Americans and Asians being the fastest growing segments of the population, focusing on these consumers will translate to  “GREEN” i.e. the money.   Now isn’t that ultimately our goal?

 

Why Compete like a Commodity IF You Have No Desire to Be One?

By Telisa Yancy, American Family Insurance

A few weeks ago, I and the twenty-six person team I have the privilege of leading, sat in a small conference room near Madison Wisconsin challenging ourselves to “break barriers, think differently and challenge ourselves” to figure our new and innovative ways to be authentic in the way we bring to life our brand, American Family Insurance.  This was an all day meeting of fun, engaging conversation, and respectfully challenging each another as we looked forward into 2010 and beyond.  At some point during the meeting, probably as someone was lamenting about the fact that insurance, the business of protecting the things that people love (my definition), was strictly a numbers, price-game, I got so agitated, that I respectfully “yelled” at the team, “Why act like a commodity if you don’t want to be one?”  At the time, I thought it was a pretty deep statement, but most of team politely ignored my outburst, and moved on to whatever was next our very packed agenda. 

Well, today, John Stratton, CMO of Verizon, vindicated me!  He explained to the audience of the Masters of Marketing Conference how he and his team have essentially challenged themselves to walk away from the temptation of competing on price in the very competitive telecommunications industry.  According to John, Verizon made a commitment several years ago to:

• KNOW who they were as a company and a brand,
• Get really clear about what they did, and
• Get fanatically committed to doing it better than anyone else.

According to John, getting this type of clarity is not easy but pays in dividends.  It requires that we as marketers and brands invest in our core competency and make conscious decisions to be slow on some things if that “thing” runs the risk of detracting from your core competency.  The dividends have been in customer growth, satisfaction with the services they provide, brand clarity, and most importantly, growth. 

Today, as I sat with three members of my team who witnessed my “why be a commodity” out-burst, and my VP of Marketing, Lisa Bacus, listening to John review the long-running, but still very relevant to the consumer and his company “Can you hear me now” campaigns, I peaked at all of their notes to what they were writing down—and without fail,  each of us wrote something to the effect of being committed to the brand without fail and making sure that this commitment guides our actions, our choices and our communications with our customers. 

Commoditization of brands is not just about price—it’s about moving away from the essence of who the company /brand is and getting lost in trying to compete in a game you didn’t set out to play.  Economic factors, fragmented media landscape and the rapid evolution of new media and marketing techniques are all capable of move even the strongest brands away from their core competencies. 

John’s message had a lot of themes—avoiding the temptation of competing on terms other than the ones you set, developing enduring creative campaigns, and even commitment to your brand essence.  As a marketer, I walk away with a new challenge of being committed to helping our brand remain authentic to who we are, what we do, and how we do it better than anyone else.  For John and Verizon, it’s the “best and most reliable network”, for Stephen Quinn, CMO of Walmart, who spoke earlier, it’s “helping consumers save more to live better lives”, for our team, it’s helping families protect the things they love. 

So what is it for you and your brand?

ANA 2009 “Masters of Marketing” Annual Conference Kicks Off

By: Megan Burke, CooperKatz and Company

Over 1,200 of the country’s marketing leaders have arrived in Phoenix, Arizona for the ANA’s Masters of Marketing Conference which, as the 99th gathering of the ANA will also serve as the launch of the organization’s year-long 100th anniversary celebration. I am glad that I pulled myself from the JW Marriott’s lazy river in time to hear the powerful and uplifting keynote address given this morning by ANA President and CEO Bob Liodice.
 
According to Liodice, the conference, themed “Growth: Defying the Recession,” will not only serve as an opportunity to look back at the past year, but as the beginning of an anniversary year dedicated to looking into the ANA’s rich history as well as forward at the challenges and opportunities of tomorrow. He even unveiled a “Marketer’s Constitution” for the next 100 years. Check out this New York Times article which discusses the conference and speech more in depth.
 
I just finished signing the constitution next to Bob Liodice and Becky Saeger of Charles Schwab. If you did not make it out to Phoenix, look for the Constitution on ANA.net in the next few weeks where I am told digital signatures will be accepted.