Global Marketing Effectiveness

Increasing Marketing Effectiveness in Today's Global Economy

2009-03-26T17:08:00.001-04:00

Take a look at current trends, and you’ll see why global
marketing leaders have one of the most difficult jobs going
today. That’s because marketing – the way companies create
customers and enable sales -- is being turned on its head like
never before. Metrosexuality is in. The nuclear family is going
away. High-income groups are spending on ‘anti-luxury’, and
vice versa. Connectivity is dramatically increasing transparency
– and placing a premium on authenticity. People are being
empowered to have more choices – and having the technology
to enforce them.

To truly succeed in this brave new world, marketing leaders are
going to have to adopt a global brand CEO mindset. Because
the question is not whether to go global, but how to do so most
effectively. Yet, typical corporate structures provide them with
no control over local marketing teams who are expected to
deliver top-line growth. Uncoordinated resources and ‘secret’
regional projects go hand in hand with insufficiently resourced
global projects that strike at the heart of a brand’s global
competitiveness. The results are often increased market research
costs as global marketers find local marketing colleagues
‘checking’ that the global mix will actually deliver in their
countries. Local marketers often feel misunderstood and even
disenfranchised by global marketers, who may be perceived as
lacking understanding of the local market reality and have no
P&L accountability for actually landing initiatives in real markets.

Effective global brand CEOs are those who have succeeded in
rising above these challenges. More often than not, they have
done so by committing to a five-step process in which they
connect, inspire, focus, organise and build deep marketing
capability across the board, around the world.

Over the past seven years, EffectiveBrands’ ongoing Leading
Global Brands project has provided a fact-based foundation for
our work with global brand leaders on improving the
effectiveness of their global marketing machine. The project
includes contributions from more than 135 global brands, 1,350
global brand leaders, and a database of results from over 13,500
global marketers.

Our experience is that new global brand leaders are typically
quite comfortable developing the ‘what’ of global marketing:
insights, innovation and communication. However, we have
found that what keeps many global brand leaders awake at
night is the challenge of global leverage—the ‘how’ of global
marketing: working with local marketers on executing a single
global brand strategy, enabling global marketing team
alignment, improving speed-to-market and sharing brand
expertise across geographies.

Understanding One Another

To connect and develop crucial interdependence between global
and local teams (each of whom feel they know what’s best for the
brand), local teams must first be convinced that their market
success is what drives the global team’s work. Global teams,
meanwhile, must understand that looking for similarities rather
than differences has become the local groups’ prevailing mindset.

When Starbucks’ former VP-Marketing Karin Koonings first joined
Starbucks’ international team in 2004, she found that their local
marketers around the world were unimpressed by global efforts;
mostly because they were clueless about them. Ms Koonings’
first order of business was to connect personally with regional
and local teams to listen and determine firsthand their challenges
and opportunities. She then briefed her teams to better connect
with international markets via regular personal visits, telephone
calls and new ‘immersions’ at corporate and regional offices. After
that, connecting disparate markets was taken a step further by
promoting a virtual exchange program among employee partners.

Internal Communications

After connecting, you must inspire and energise passion around
the brand. Behind every successful global brand is the gem of a
universal insight that attracts consumers, and has the power to
inspire all who work with the brand around the world.

From the insight that only 2% of women in the world felt
comfortable saying they were beautiful, Silvia Lagnado, former
global brand VP for Dove, developed a mission to forge a stronger
emotional bond between Dove and women based on the insight
around building self-esteem – and started at the very top to focus
Dove’s global brand priorities in order to win big. She
masterminded the creation of a video clip to represent the
inspiration for the brand – and boldly played it to Unilever’s board
of directors. The film showed children while the narration talked
about their negative self-image as a result of the messages our
society transmits about beauty. But here’s the thing: The talent
featured in the film were the children of Unilever’s board members.
At the end of the showing, there wasn’t a single board member
who did not believe devoutly in the cause that Dove was about to
embark on.

Ms Lagnado went further. She dramatically reduced company’s
innovation projects globally from 400 to fewer than 20; and
consolidated five distinct regional business plans into a one-page
global strategy document.

Consolidation Is Key

Next is organising, and one thing is certain: Consensus-driven
cultures don’t work. A leader must not be afraid to enforce
alignment and then give full decision-making responsibility to
those accountable.

During her time at Dove, Ms Lagnado cancelled ineffective 30-
person global brand team meetings in favour of an empowered
Dove Board of seven senior marketers, charged with oversight of
a single global brand strategy. Starbucks brought all its regional
marketing leaders together for a two-day summit and forced
explicit agreement on who led and who followed for all key brand
decisions. More recently, PC giant Lenovo has established a global
marketing hub in India, collapsing the planning and production
of independent regional marketing initiatives into one centralised
effort emanating out of Bangalore.

But beware the hit to the motivation of local market talent when
they consequently lose some of the most enjoyable parts of their
jobs. It is crucial to impart to local employees the strategic
importance of their refocused roles, and to celebrate their
activation successes. Companies which ignore this critical change
management effort seldom taste the fruits of global marketing
effectiveness.

Sustaining Consistency

Now try to maintain all this for the long haul. Building brand
consistency, avoiding the reinvention of programmes, and
accelerating the rollout of successful brand programmes globally
are all challenges global marketers face everywhere. Achieving
these long-term goals takes global brand leadership that focuses
ample time on educating anyone who touches the brand,
harvesting learning from other countries.

Our Leading Global Brands study provides robust evidence that
companies and marketers who tenaciously prioritise these efforts
to connect, inspire, focus, organise and build global marketing
capability are well-positioned to win in the marketplace today.

You may well feel that these are seemingly straightforward
imperatives, simple to execute and lacking in strategic pizzazz.
There must be some secret sauce. Why aren’t more companies
accelerating growth by deepening their global leverage and local
relevance?

To which we simply observe that there are many Bibles in the
world… but not many Christians.

Wat Verder Ter Tafel Komt

2009-03-26T15:44:00.000-04:00

Wat Verder Ter Tafel Komt

Naam Marc de Swaan Arons
Functie Chairman van EffectiveBrands
Locatie The Corner Café, New York

‘Ik bedoel: hoe prominent wil je een wasmiddel in je leven hebben?’

Met zijn bedrijf EffectiveBrands adviseert Marc de Swaan Arons multinationals als Unilever, Coca-Cola en Starbucks bij het realiseren van hun globale markeringstrategiën. ‘Een strategie bedenken voor een product is niet zo moeilijk; wel om die in vijftig landen uit te voeren.’

‘Ik kom hier vaak,’ zegt Marc de Swaan Arons (42), als hij – in spijkerbroek met boots onder een gestreept jasje van hedendaagse snit – het Corner Café op Broadway in New York binnenstapt. ‘Maar het is ook weer niet zo dat ze me hier kennen. Daarvoor komen hier te veel verschillende mensen.’
Dat blijkt niet helemaal te kloppen: De Swaan Arons wordt bij binnenkomst onmiddellijk herkend en enthousiast begroet door de maître d’, een slanke brunette die met haar modieuze verschijning net zo goed in een van de boetieks in het nabijgelegen SoHo had kunnen werken. ‘Prachtig jasje,’ zegt ze tegen hem, terwijl ze heel even haar hand op zijn schouder laat rusten.
Zo krijgt De Swaan Arons de behandeling die niet alleen past bij zijn status van vaste klant, maar die ook past bij zijn uitstraling. Hij lacht makkelijk, praat vlot en kijkt met zijn helderblauwe ogen onversaagd de wereld in. Geen muurbloempje, dus.
De maître d’ placeert ons aan de grote tafel in het midden van het restaurant, tot genoegen van De Swaan Arons. ‘Dit café brengt een hoop dingen samen die ik fantastisch vind aan New York. Het is altijd gevuld met mensen waarvan ik het idee heb dat ze iets interessants aan het doen zijn. Hier aan de grote tafel, waar ik vaak zit, hoor je ook de gesprekken aan de andere tafels, waardoor je middenin de New York buzz zit. En het eten is goed, ook niet onbelangrijk.’
Verlekkerd prijst hij de kaart. ‘De roereieren op toast zijn heerlijk, die neem ik meestal met spinazie als bijgerecht. De zalmburger is ook uitstekend. Ach, eigenlijk is alles hier lekker.’ Als de ober komt, bestelt hij een salade van rode bieten. ‘Ik heb vanavond nog een dineetje met vrienden, dus ik wil nu niet te veel eten.’

Cosmopolitisch
De Swaan Arons heeft wat hij zelf noemt een ‘hybride achtergrond’, met dank aan de internationale loopbaan van zijn vader, die bij Shell werkte. Hij werd geboren in Amerika, uit Nederlandse ouders, waarop het gezin al snel naar Amsterdam verhuisde. Daar bleef hij tot zijn tiende. Zijn ‘vormende jaren’ bracht hij vervolgens door in Londen, na weer een emigratie. Hij bezocht er een internationale school, thuis werd Nederlands gesproken.
Zijn loopbaan is daarentegen een stuk eenkenniger verlopen. Na zijn studie economie in Rotterdam, wilde hij weer naar het buitenland, liefst naar Londen vanwege het cosmopolitische karakter van die stad. Een reeks sollicitaties leverde louter aanbiedingen uit het buitenland op, op één na: marketeer bij Unilever in Rotterdam. ‘Een wereldbaan waar ik geen nee tegen kon zeggen.’
Bij Unilever zou De Swaan Arons 14 jaar blijven, steeds in het vak waarin hij vandaag nog actief is: marketing. Na zeven jaar, in 1996, werd hij naar New York uitgezonden, om daar voor Unilever een internetgroep op te zetten.
Dat hij met tevredenheid terugkijkt op deze gang van zaken, is een understatement. ‘Ik besef twee, drie keer per dag wat een rijk leven ik heb. Ik heb een waanzinnige relatie met mijn vrouw en drie goddelijke kinderen. Ik woon in de stad van mijn dromen, ik reis de hele wereld over en heb een bedrijf dat inmiddels op vier plaatsen in de wereld kantoren heeft – en ik doe precies waar ik passie voor heb.’
Die passie, dat is marketing. Of beter: marketing op globaal niveau. Een passie die zou leiden tot de geboorte van EffectiveBrands, het bedrijf dat hij in 2001 mede-oprichtte en waarvan hij nog altijd chairman is. Een van de klanten is uiteraard Unilever, waar De Swaan Arons zo lang voor werkte, maar dat is lang niet de enige grote naam waar EffectiveBrands mee werkt. Het jonge bedrijf zit met veel van de meest succesvolle multinatinals aan tafel, waaronder Novartis, Akzo Nobel, Coca Cola, J&J, Sony-Ericsson en Starbucks. EffectiveBrands had in 2008 een jaaromzet van ruim 10 miljoen dollar …

Waarom hebben jullie destijds EffectiveBrands opgericht?
Omdat we er zelf behoefte aan hadden. Ik kwam in 2000 bij Unilever in een global-marketingrol terecht, een tijd waarin globalisering verreweg de belangrijkste megatrend was. De rol van global brands werd dus steeds groter. Ik ontdekte al snel dat het niet zo moeilijk is om een globale strategie voor een product te ontwikkelen; wat wel heel erg moeilijk is, is om die strategie in 50 landen uit te voeren.
Wat bleek, er bestond geen boek dat hierover gaat. Er was ook geen groep of netwerk die hiermee bezig was, dus daar kon ik ook niet terecht. En er bestonden ook geen consultants die hierin gespecialiseerd waren. Toen heb ik samen met enkele andere marketeers besloten dat we zelf maar die consultants moesten worden. Probleem was alleen: wij wisten er niet veel meer van dan een ander.

Ja, hoe zijn jullie experts geworden?
Door het Leading Global Brands Project te creëren. We zijn letterlijk gaan bellen – met bijvoorbeeld de baas van Heineken destijds, Anthony Ruys, en de marketing bazen van Dove en Mastercard – en hen gevraagd om ons in vertrouwen te vertellen wat goed en fout gaat; wat lukt en wat mislukt bij het uitrollen van een global brand-marketingstrategie. Binnen een jaar hadden we 25 grote merken die mee gedaan hadden. Inmiddels zijn dat er meer dan 150. Daarnaast zijn we een database gaan bouwen met benchmarkinggegevens, waaraan meer dan 15.000 global marketing collegas hebben bijgedragen. Dat is een gouden zet geweest, want zo kun je objectief en meetbaar succesfactoren vaststellen. Daar was duidelijk behoefte aan.

Hoe vertaal je die waarnemingen naar concrete adviezen?
Toen Sony Ericsson bij ons kwam, konden we binnen twee maanden hun organisatie en doelstellingen vergelijken met meerdere vergelijkbare merken; waaronder ook de beste merken ter wereld. Vervolgen konden we precies zeggen waar ze te kort schoten, waar ze op par liepen en waar ze uitblonken. Op basis van zo’n analyse kun je echt strategisch advies geven, dus letterlijk zeggen: ‘als wij jou waren, zouden we ons het komende jaar vooral op deze drie grote initiatieven richten.’ Vervolgens hebben we ze geholpen om hun hele marketingplan in de organisatie te implementeren – tot aan rollen en verantwoordelijkheden op lokaal, regionaal en global niveau.

Je zei eerder dat het makkelijk is om een globale strategie voor een product te verzinnen – is dat wel zo? Afrika of Azië zijn toch heel andere markten dan Europa of Noord-Amerika?
Dat valt best mee. De rol van bijvoorbeeld Dove in het leven van een consument is vrij consistent door de wereld heen. Dat geldt helemaal voor Dell of Apple – iedereen doet hetzelfde met een iPhone. Onze beleving is dat ze bij Dove niet wakker ligt over het bepalen van de juiste strategie, innovatie of communicatie. De vraag van de global marketeer daar is: hoe krijg ik in 50 landen al mijn collega's, die net zo slim zijn als ik maar dichter op de markt zitten, zo ver dat ze mij enerzijds vertellen wat ik moet weten om een goede global strategy te laten uitvoeren en anderzijds die dan consistent uit te voeren?

Wat vind je een goed voorbeeld van een geslaagde wereldwijde marketingcampagne?
Die van OMO, overigens ook een klant. Na ongeveer 50 jaar oorlog tussen de merken – waarin mannen in witte jassen kwamen vertellen waarom de een nog witter waste dan de ander en dat die en die molecuul meer sexy is dan die – heeft OMO gezegd: ‘Onzin! Vuil is niet slecht, vuil is goed.’ Want je wilt als ouder helemaal niet dat je kinderen brandschoon zijn. een goede ouder laat de kinderen juist lekker spelen en vuil worden. Daarmee heeft OMO Proctor & Gamble helemaal op het verkeerde been gezet, want hoe gaat een meneer in een witte jas daar nu tegenin? Consumenten zijn daar helemaal niet geïnteresseerd in. ‘Ik bedoel: hoe prominent wil je een wasmiddel in je leven hebben?’
Maar wat vooral zo briljant aan de OMO-campagne is, is dat ze dat idee wereldwijd hebben uitgerold en een strategie hebben waarbinnen elke regio zijn eigen vertaling aan het idee geeft.

Heb je daar een voorbeeld van?
In delen van Azië is in de modder vallen een metafoor voor eerverlies. In de Indiase OMO-reclame redt een jongetje de eer van zijn zusje dat in de modder is gevallen, doordat ze samen boos worden op de plas. Dan vechten ze met de modder en wordt duidelijk dat vuil goed is. En dat kun je je veroorloven als je weet dat een wasmiddel het vuil er later uithaalt.

Heb je ook een voorbeeld van een marketingcampagne die volgens jou falikant mislukt is?
Die ING-campagne die iets zegt over hoe fijn het is als iemand op de details let. Ik begrijp niet zo goed wat dat zegt over ING. Problematisch is ook dat de reclames hetzelfde zijn in Nederland en Amerika. Veel mensen denken dat global marketing erover gaat dat reclames overal hetzelfde moeten zijn. Goed voorbeeld van hoe het wel moet is Dove, dat in Amerika 100 gewone, lees wat forsere vrouwen liet zien in plaats van de gewone flinterdunne modellen. Hier werd dat vertaald als: dat zijn echte mensen en waarom doen we daar eigenlijk gekscherend over? Om in Japan hetzelfde effect te bereiken moesten juist zeer dunne vrouwen getoond worden.

Het woord ‘globaal’ valt vaak in dit gesprek. De huidige recessie is natuurlijk ook erg globaal: er is geen plek ter wereld waar het nu goed gaat. Hoe merk jij dat?
Enerzijds hebben wij er ook last van. Ik heb van Coca Cola en andere grote klanten e-mails ontvangen waarin letterlijk staat: ‘Nu even geen consultancy.’ Dan houdt het gewoon op.
Anderzijds groeien wij nog steeds heel hard, vorig jaar nog met 25 procent. Recessie versnelt globalisering. Ola-ijs is een goed voorbeeld. Daar bleek bij een inventarisatie dat ze 2500 foto's van een aarbei hadden.
Wat je nu ziet in de recessie is dat mensen sterker naar de kosten en vooral de focus van elke medewerker kijken en zeggen: ‘Waar zijn we nou helemaal mee bezig, hebben we niet aan tien foto’s genoeg, of waarom doen die mensen hetzelfde? En waarom bestaat ons merk in 13 verschillende vormen, 12 verschillende namen en 10 verschillende verpakkingen? Is dat echt nodig?’
Daar ligt dus eigenlijk een hele grote opportunity voor ons. Veel van onze klanten zijn juist daarom binnengekomen.

Wat zeg je speciaal in dit geval deze tegen klanten?
Als eerste: ‘Niemand raakt gemotiveerd van de mededeling dat we nu 15% minder kosten hebben.’ Vaak hebben de cijfermensen de overhand en wordt besparen haast gezien als het doel van de zaak. Maar dat betekent alleen maar dat er collega's ontslagen zijn. Maar mensen worden wel enthousiast als ze horen dat je een global vision hebt. Dan kun je grotere dingen doen, die je in het verleden niet kon doen. Het beroemde voorbeeld is natuurlijk de terugkeer van Steve Jobs bij Apple. Hij bracht het aantal innovaties terug van een paarhonderd naar twee: de i-Pod en de i-Phone. Bigger, bolder and faster innovation; daar worden marketeers enthousiast van en er hangt ook nog een lager kostenplaatje aan.

2009-03-26T13:38:00.000-04:00

Global brand leaders have one of the most difficult roles in brand marketing. Chief executives expect them to drive above-average growth through increasing global leverage. Yet, typical corporate structures provide them with no control over the local marketing teams that are expected to deliver the growth. No wonder that many global brand leaders can become too focused on the internal battle with local marketers, as they try to drive global strategic alignment across markets.

Over the past seven years we have worked with global brand leaders on improving the effectiveness of their global marketing machine. The project, Leading Global Brands, includes contributions from 120 global brands, 1,200 global brand leaders, and database of results from over 12,000 global marketers.

The new global brand leaders are typically quite comfortable developing the “what” of global marketing - insights, innovation and communication.
However, we have found that what keeps many global brand leaders awake at night is the challenge of global leverage, or the “how” of global marketing - working with local marketers on executing a single global brand strategy, enabling global marketing team alignment, improving speed to market and sharing brand expertise across geographies.

In looking at increasing global leverage, when global and local marketers discuss internal alignment around the brand’s mission and objectives, both are often right about what will drive success for the brand. The disagreements can be explained by the understandable and necessary differences in vantage points and time horizons.

However, even with the brand mission and brand strategy agreed upon, there is often a lack of alignment on what priority projects will best enable the brand objectives. A failure to co-ordinate resources and “secret” regional projects go hand in hand with insufficiently resourced global projects that strike at the heart of the brand’s global competitiveness. The results often fail to measure up to expected standards of performance, value or production for global innovation and increased market research costs because global marketers find local marketing colleagues “checking” that the global mix will actually deliver in their territory. Even more importantly, this often leads to unproductive attitudes and actions that quickly spiral downward into a lack of willingness to focus sufficient local resources on global projects.

The critical underlying challenge to address is often a lack of real trust and interdependence between the local and global marketing teams. Local marketers often feel misunderstood and even disenfranchised by global marketers, who may be perceived as lacking understanding of the local market reality and have no profit and loss accountability for actually landing initiatives in real markets.

In dealing with this, the biggest pitfall that the companies studied struggle with is the failure to clarify roles and responsibilities early on. Many global brand organisations get stuck in a consensus-driven culture and lack the courage to properly allocate full decision-making responsibility. Defining the operating model and roles on key decisions is important, but enforcing the model and required behaviours is even more important. If behaviours inconsistent with the new operating model are tolerated, particularly among leaders, this will cause significant delay and frustration.

Many global brands’ operating models have taken innovation and communication development responsibilities away from the countries and into global brand teams, allowing an increase in the focus on local market activation. This highlights the strategic importance of the local marketing activation role, driving new marketing excellence programmes to increase organisational capability in this area. Celebrating the successes of activation leaders will ensure that global-local transitions happen more smoothly and that key local marketing talent is retained.

Handled well, communication of this transition allows both global and local marketers to focus on their areas of strength and the contributions they can make to accelerating brand growth through global leverage.

Helen Duce is executive director of global marketing consultancy EffectiveBrands

The Global Brand CEO

2008-05-20T16:46:00.000-04:00

http://www.effectivebrands.com

What It Takes to Really Win Globally

A Global Brand CEO Looks Beyond Typical Focus on Insights, Innovation and Communication

Published in Advertising Age: May 19, 2008

If they aren't already losing sleep over this question, global brand marketers have more than enough right to: How must we leverage our global brands?

Studying more than 50 global brands over the last five years, among them global superstars Starbucks and Unilever's Dove, it's clear that the winning leadership mind-set is one that looks beyond typical focus on insights, innovation and communication.

Those are a start, but focusing on them won't get you far enough in today's highly competitive global economy. Rather, the leaders I call true global brand CEOs forcefully build long-term global marketing capability by driving a single global strategy, forcing organizational alignment, improving speed-to-market and building brand expertise across geographies. Easier said than done? Of course.

Global marketers share a variety of similar hurdles when trying to solve the complex global-leverage equation, not the least of which is a lack of alignment around the brand's objectives. And even with one agreed-upon brand mission, organizations often differ on what the strategy and priorities should be and lack the necessary trust and communication between local and global marketing teams.

Single focus
The U.S. success of the 'Priceless' campaign enabled MasterCard CMO Lawrence Flanagan to persuade other countries to adopt consistent positioning. But effective global brand CEOs simply have to rise above these challenges by committing to a five-step process in which they connect, inspire, focus, organize and build.

Understanding one another
To connect and build crucial interdependence between local and global teams (each of whom feel they know what's best for the brand), local teams first need to be convinced that their market's success is what drives the global team's work. Global teams, meanwhile, must understand that looking for similarities rather than differences has become the local groups' prevailing mindset.

Consider these examples.
The success of the "Priceless" campaign as a platform in the United States helped MasterCard Worldwide Chief Marketing Officer Lawrence Flanagan persuade other countries to adopt one single, consistent global positioning. "What started as an advertising strategy became a marketing platform and went on to become our global brand platform," Mr. Flanagan said.

When Starbucks' former VP-Marketing Karin Koonings first joined Starbucks' international team in 2004, she found that their local marketers around the world were unimpressed by global efforts, mostly because they were clueless about them. Ms. Koonings' first order of business was to connect personally with regional and local teams to listen and determine firsthand their challenges and opportunities. She then briefed her teams to better connect with international markets via regular personal visits, telephone calls and new "immersions" at corporate and in regional offices to offer interaction and strategic planning as often as possible. Then she took connecting disparate markets a step further by promoting a virtual exchange program among employee partners, allowing them to rotate between markets and headquarters. Such connection is crucially important given that Starbucks, which opened its first location outside the United States in 1996, now operates in more than 40 countries.

Silvia Lagnado, former global brand VP for Dove, likewise faced massive challenges connecting to long-autonomous local marketing directors from each region when she became the global lead for Dove in 2001. Dove was Unilever's first brand ever to be assigned a dedicated global brand team. Amazingly, Ms. Lagnado united 600 Unilever marketers and their ad agency counterparts behind the single, focused Campaign for Real Beauty strategy. How? With the creation of the Dove Board -- a team of five marketers from each of the brand's key regions -- and by institutionalizing regular updates between global and local teams. Internal communication

At Danone, having a strong network has been very important to creating unity. "We are publicly encouraged by top management to get together, create a network and talk to colleagues in other countries on issues we face, rather than relying solely on formal meetings," said Oliver Faujour, general manager of Danone's Asia Pacific Management Co. Danone also relies on its corporate "Who is Who" intranet as a networking facilitator.

After connecting, you must inspire and energize passion around the brand. Behind every successful global brand is the gem of a universal insight that attracts consumers and has the power to inspire all who work with the brand around the world. Over time, after many different marketers and consultants have made their mark, these "truths" often become lost or hidden, and it takes a serious peeling-of-the-onion exercise to get back to a simple formula that hits the universal sweet spot.

Successful leaders of global brands instinctively understand the importance of energizing passion for the brand internally and go out of their way to ensure it reaches all that matter to the brand's growth. From the insight that only 2% of women in the world felt comfortable saying they were beautiful, Ms. Lagnado and her team derived the necessity of building women's self-esteem. They developed a mission to forge a stronger emotional bond between Dove and women worldwide based on this insight and rallied Dove marketers around the globe with conferences, web casts, newsletters and personal presentations. Ms. Lagnado, rather than selling her vision of the brand, successfully imparted this new non-negotiable brand direction with genuine concern and understanding of local marketers' needs, something we call "empowering leadership."

After inspiring, of course, you must focus, setting global brand priorities that will win big. Vigilant commitment to those priorities is crucial, because inconsistency can lead to lower quality, higher costs and -- often -- failure. For Dove, focus meant that Ms. Lagnado had to dramatically reduce innovation projects globally from 400 to fewer than 20 and consolidate five distinct regional business plans into a one-page global-strategy document. The "Dove One-Pager" (something of a legend at Unilever) defines what everyone working on Dove lives and breathes daily.

Consolidation is key
For Starbucks, focus meant consolidating the multitude of regional initiatives into a single international promotion calendar developed by a global team in conjunction with regional support teams. This agenda is rolled out and implemented by local marketing teams across the globe, helping Starbucks fulfill its brand promise of exceptional customer service and fuel its explosive international growth.

Next is organizing, and one thing is certain: Consensus-driven cultures don't work. A leader must not be afraid to enforce alignment and then give full decision-making responsibility to those accountable. Failing to specifically clarify roles and responsibilities early on is undoubtedly the biggest pitfall of companies we have studied. And, once clarified, enforcing adherence to that model is just as crucial. Ms. Lagnado boldly canceled ineffective 30-person global brand team meetings held quarterly for Dove in favor of an empowered Dove Board of seven, which was charged with oversight of the single global brand strategy, including assigning advertising development to regional brand leaders. Starbucks brought all its regional marketing leaders together for a two-day summit and forced explicit agreement on who led and who followed for all key brand decisions.

Many other global brands today are shifting development of equity, innovation and communication strategies away from individual countries to global brand teams, providing for consistency, lower costs and speed. But beware of the hit to local market talent's motivation when they consequently lose some of the most enjoyable parts of their jobs. For example, Procter & Gamble lost a lot of great local talent when it first globally centralized marketing in the mid-1990s. To ensure a smooth transition, it is crucial to impart to employees the strategic importance of their refocused role and to celebrate their activation successes.

Sustaining consistency
Now try to maintain all this for the long haul. Creating brand consistency, avoiding the reinvention of programs and accelerating the rollout of successful brand programs globally are all challenges global marketers face everywhere. Without these, besting local and retailer brands is next to impossible. Achieving these long-term goals takes global brand leadership that focuses ample time on educating anyone who touches the brand, harvesting learning from other countries. For Starbucks, such education was created through the Starbucks Learning Series, which builds local marketing skills and creates an exchange platform. For Dove, it is the Dove Planet, a brand intranet site that addresses brand questions and shares relevant experiences. Going global, as you well know, is no longer an option.

Having leadership that knows how to leverage scale and how to increase local competitiveness is crucial. How can you afford not to?

Copyright © 1992-2008 Crain Communications

http://www.effectivebrands.com

GSK Consumer Healthcare: Putting the Global back in Global Marketing

2008-05-17T13:32:00.000-04:00

www.effectivebrands.com

Over 1200 global marketing leaders from more than 120 global brands have participated in the EffectiveBrands Leading Global Brands™ project. All participants are the CEO, Chief Marketing Officer, Global, Regional or Local Brand Director of a global brand and share a desire to be thought leaders in developing ideas and best practices for leading the global brands of the future. The EffectiveBrands Global Brand PulseCheck™ database now includes contributions from over 12,000 marketers.

The focus of this month’s Leading Global Brands Bulletin is on how GlaxoSmithKline (GSK), a leading pharmaceutical and consumer healthcare company, evolved its Consumer Healthcare marketing organization from an autonomous and decentralized one to a highly globalized organization where the ‘Future Group’ focuses on global brand innovation and brand equity working side-by-side with country marketing organizations that own full responsibility for local deployment. By defining themselves around their global brands and not their geographies, GSK Consumer Healthcare was able to quickly deliver dramatic improvements in their pipeline and aggressively grow the business (from 3% to 14%) through innovation centered on consumers and driven by science.

Peter Kirkby is VP Marketing Strategy & Excellence (MS&E) for GSK Consumer Healthcare. Working within the Future Group his global responsibilities include consumer and market insight, strategy, brand and communications planning, digital marketing, agency management and the company’ marketing capability program. Prior to joining GSK, Peter worked for Procter & Gamble and for a consultancy.

EffectiveBrands (EB): GSK Consumer Healthcare has evolved its
approach to global brands over the last few years. Take us back to
the beginning. How did the previous marketing operating model work at GSK?

Peter Kirby (PK): Countries and regions were traditionally very
autonomous within GSK Consumer Healthcare. About 5 years ago little
was organized across regions with the exception of a central marketing
group called ‘Category Management’. Under that system, we had a
small team in the center trying to leverage marketing learning across the
business with some remit for innovation, but really without the necessary
resources, money or the authority to take a lead. At that point, our
innovation agenda was being driven more by the regions and countries,
with fragmentation as a consequence.

EB: So what was the impetus for changing the marketing organization?

PK: We weren’t growing fast enough. Our focus had been on profit delivery, but that was clearly not a sustainable model long-term. So about five years ago, we challenged three teams to determine how best to accelerate growth in the company. All three teams came to the same conclusion: to drive growth we needed to step-change our innovation. The teams recommended a more centralized, robust, and connected global marketing and R&D organization for our global brands - freeing-up our regional and local brands - by essentially putting decision making in the right places and at the right levels. The new global organization would need to concentrate and take the lead on driving the growth and innovation agenda on our global brands. In short, our brands needed to become ‘future brands’. That’s when the decision was taken to change the operating model.

EB: Can you talk a little about the new operating model?

PK: The new operating model was based on the key principle that we needed to move from being a geographically orientated company with some above-country strategic support to being one where our global brands are in the lead and being developed and managed globally.

We ended up with an operating model where the global responsibility for our biggest brands was placed with what we call the ‘Future Teams’. Fundamental to this model was the need for the top 5 markets for each global brand to play a key role within the Future Teams. The objective was to drive growth through innovation and focus scarce resources where they could make the biggest difference.

EB: Sounds like quite a shift from the past. How were these Future Teams set up and who was invited to work on them?

PK: A lot of care was taken in the formation of the Future Group Teams to ensure the teams represented a true mix of brand and market expertise. We didn’t want to build a central global team made up of biased country or brand points-of-view. To be successful, we also needed brand and R&D teams to be more than joined at the hip. We wanted deep, natural collaboration, and strongly incentivized them to work collaboratively. We co-located the cross functional teams into the same physical space and went to great lengths to ensure people understood the Future Group model was a joint commercial and R&D model. The former President of Europe, John Clarke, now the President of GSK Consumer Healthcare, was the first head of the Future Group, and his drive for results was critical in quickly establishing the group’s credibility.

EB: What was the promise to the organization, and did the Future Teams deliver?

PK: The promise was that the Future Group Teams would step-change the innovation pipeline to drive growth. This focus was deliberate. First, if you are going to grow, you need innovation to fuel that growth. Second, if you take the resources out of the local markets, you need to produce something very tangible, very quickly, to bring the strategy to life. Strategy is all well and good but in the end it’s words on paper. You need something you can touch and feel - you need action. Understandably, the more the country general managers were comfortable with innovations developed centrally, the more they would focus their resource towards great local market activation. In terms of delivery, I think everyone in the company agrees that the quality of our innovation has improved significantly over the last 3 years.

That’s not to say that each team had the same immediate success. What emerged was that the teams that had been given a remit beyond just innovation were more successful. They were doing classic brand management, with full ownership of strategy, equity and innovation. This difference in operating models between teams was deliberate for two reasons: first, some teams had a greater innovation need than others and required focus; second, it eased the transition from local to global with the Markets. However, it created complexity when, for example, you had debates on innovation vs. equity communication with the Markets.

EB: Are you saying that the responsibility for advertising for the other global brands was split between local and global marketing teams depending on whether it concerned an innovation or the base business?

PK: Yes. We had the odd situation where if a brand’s innovation was more than three years old, the ‘model’ suggested that advertising now fell to the Markets because it was now equity and not innovation. This made creative direction and where budgets was spent - innovation or equity - difficult to control or influence, and understandably generated much ‘turf’ debate.

We had situations where our ad agencies were being briefed differently in different places and there were instances where countries were developing work on their own and Global wouldn’t find out about it until two-three months down the line. The model needed refinement. Our innovation was in a much better place but, two years in, we felt ready to evolve to the next stage of globalization. The Future Group had a new President ,Tim Wright, and it was a natural moment to sit back, take stock and listen - and show the organization that we were listening. That’s when we chose to partner with EffectiveBrands to help us focus on improving our global marketing effectiveness.

EB: What did you learn about the opportunity of increasing global marketing effectiveness?

PK: The Global Brand PulseCheck™ helped us quickly identify what we were doing right and where we needed to focus to accelerate our growth. The findings made explicit how team members were feeling and raised quite a few new areas for us to think about. For example, the results showed that, relative to other companies, we had managed to adapt to the new operating model pretty quickly; “You’ve come a long way in a short amount of time,” as you guys said. We have a pretty adaptive culture that’s not very hierarchical which is a big help, and the willingness to change as a business imperative is there. We also saw that some of our brands scored best in class against the cross-industry benchmark for ‘brand inspiration’, perhaps not surprising for a consumer healthcare company, but good news nevertheless. With hard metrics on each global brand team and region on what was working and what was not, we had the ideal challenge to up our act. The recommendations from the EffectiveBrands team gave us very tangible areas to focus on, laid out the opportunities and showed us how we could get there.

What was encouraging was the realization that we weren’t the only company facing some of the challenges we were talking about. The Global Brand PulseCheck™ provided us with a benchmark against a group of many other global brands, across other categories. But most importantly, because the findings were objective and insightful, and the work included interviews with many of our key stakeholders, the results and recommendations were readily accepted across GSK Consumer Healthcare. They provided us with an outside-in perspective and they formed the starting point for Future Group 2.0.

In terms of actual areas to focus on to help accelerate our growth, the analysis of the PulseCheck™ results told us that our markets wanted more than just great innovation from the Future Group teams. They wanted stronger strategic thinking,
and they wanted us to take on a more holistic global brand approach. Many stakeholders felt we needed to better align our global and local objectives and that there were real opportunities to fuse global and local strategic planning more comprehensively. Markets wanted us to think beyond just launching an initiative, but also have a stake in how the initiative is activated…not ‘launch it and leave it’.

In addition to this, there were some important softer points to reconsider. The
enormous focus by the central team on innovation had made some local countries feel we were too ‘launch focused’ without consideration for the full brand health and P&L. And trust was not as strong as it could have been because we did not have full alignment of targets between the local and global team members. We also realized that some of the Future Group Teams were perceived as somewhat isolated and disconnected. In our quest to develop innovation we had sometimes kept our heads down and not listened enough to our key markets. In summary, the Global Brand PulseCheck™ and the EffectiveBrands recommendations were a real call to action. It was time for better conversations with the markets and management, to drive real change; and with our local marketing colleagues, to ensure we were collaborating to develop a more holistic marketing mix to drive growth.

So, the first, and most important, change we made to the model was to make global brand teams responsible for total equity, including overall communication.

EB: What other opportunities for improvement did you identify and decide to act on?

PK: Another key learning point from the PulseCheck™ was that as an organization we needed to be more explicit about recognizing and celebrating the complementary roles we play as local and global marketing teams in order to get the best on both fronts. Much of this is how we interact and behave on a day-to-day basis, but we also made sharing directions and plans a key focus of our annual Future Group meeting that brings together all the Markets and Future Group Teams, about 300 people. We started the meeting with a reality check - an honest conversation between the Future Group President and the three Regional Presidents discussing the issues and opportunities raised in the PulseCheck™ - what’s working and not working both centrally and locally within the model. The theme of the meeting was that we, as a collective, drive the growth of our brands. It’s not about me; it’s not about you; it can only happen together.

Each Future Group Team ran brand immersion sessions rather than just a review of the pipeline, which had been the focus in the past, putting the Markets in a much better place to drive local activation. We involved high performing markets in the presentation of these sessions to show real examples where our market results improved when the global/local mix was collaboratively developed and more consistent across all the marketing mix elements.

We worked to bring the concept to life with music - we had a great jazz band improvise around one core tune - the Future Group Teams being the core and the Markets improvising around this tune to drive the brands locally.

This conference marked a change in approach; we openly recognized some things were working better than others and we were addressing this. It was far more interactive and presented a more holistic view of what was required for growth. As a result, the feedback was exceptional, with much greater clarity and the Markets better able to start activating behind all they had seen.

This year, we have gone a step further. We are combining our global marketing awards ceremony with the meeting. Within this, we have expanded the categories to fully reflect what’s required for growth and properly celebrating the critical role of the Markets within the global model. For example, we now have shopper marketing alongside communication campaigns.

EB: And did the PulseCheck™ findings lead to further global marketing operating model changes?

PK: Yes. We’ve changed how we approach strategic planning to make it far more collaborative with the Markets, and moved this much earlier in the year so it has the best opportunity of shaping both global and local thinking.

We are also working to consolidate our disparate data sources to help decision-making, speed and learning. For example, we were able to run our first global brand equity study last year and now have one communications pre-testing supplier for our global brands. Better data, better conversations and better decisions.

We’ve also staffed-up on specialist teams. For example, we have a team dedicated to developing central strategy and communication packages for healthcare professionals like dentists and pharmacists to make it easier for the Markets to focus on activation. We also have specialist Project Management resource to ensure projects are on-time and issues are managed; we’ve also created an innovation network with the Markets to drive new ideas and build the capability across the company. This all helps build confidence and trust in the model.

In addition, we created my team - a group called Marketing Strategy and Excellence -
as a support function to the rest of the Future Group. This group consists of specialist resource for all the global brands to draw on: insight, strategy, brand development, digital marketing and best practice tools. Fundamentally the team is about helping accelerate brand growth and the trust and effectiveness of the Future Group model. For example, we have built a new global research team with resource for each brand. They live with the Future Teams but report through our team to maximize objectivity and avoid the global marketers being judge and jury of their own data which has led to understandable friction with the Markets in the past. We are also completely revamping the company’s marketing excellence program to help drive growth and create one common language.

EB: Was there anything else you did to promote better collaboration between the local and global teams?

PK: Yes, we tackled the level of alignment and trust between local and global teams because, at the most fundamental level, the model works only when you have trust. We began moving more people from the markets and putting them into the Future Group and exporting folks from the Future Group into the local markets. By putting on the other person’s shoes, trust and understanding between local and global was immediately strengthened and a real sense of interdependency developed.

We’ve also worked hard to improve collaboration within the Future Group by breaking down physical barriers. Firstly, we aligned functions to the brands and moved them into the same building. We then decided to truly ‘colocate’ and put all the different highly matrixed functions in the same physical space by literally knocking down walls and creating Global Brand ‘Innovation Hubs’. Each Future team as well as the leadership of the Future Group and R&D did away with their offices and now work together at one big ‘kitchen table’. The spaces are more fun and inspiring to work in but, more importantly, we’re having more live conversations not to mention ‘constructive eavesdropping’, and email traffic has fallen sharply within the teams.

EB: In closing, what would you say are the most important qualities for a global brand director to be successful?

PK: The key is inspirational leadership backed by a real willingness to get close to key markets. Great global brand leaders galvanize disparate teams to give common purpose, direction and clarity and have the right technical marketing talent to develop global brands. They are willing to address the reality as it is, not as they would like it to be. They inspire at all levels and are able to manage up, down and out. They listen well and with humility. They must have a strong appreciation for the local markets that live and breathe the commercial reality every day-there can be absolutely no remoteness. They must have a great understanding of the big picture and have an ability to communicate this in a compelling way to the wider audience.

EB: So now, another year on, did the changes lead to the results you were looking for?

PK: Absolutely. Our global brands are growing, and progress at both the global and local level has been significant. I think most folks inside the company would agree that not just our global strategies are better, but we are also beginning to see corresponding improvements in the local execution of our mixes. Not everything is just as we would like it to be, but overall, 14% company growth last year is a huge improvement from the historical 2-3% that we were seeing.

We just recently completed our second annual PulseCheck™ and the results are testimony to the changes and effort. Not only is there significantly higher confidence in the quality of our innovation pipeline, countries are also playing back that they trust the Future Group to deliver on promises (a 15 base point improvement) and that they have significantly more confidence in the Future Group to help them win their local market battles (almost a 20 base point improvement). We are also seeing much higher scores on the clarity of our global brand strategies, roles and responsibilities and willingness to work globally. For example, one brand that had worked very hard at improving connection with the markets based on the results of the first PulseCheck™ saw its score on ‘the Future Team understands my local market reality’ increase by almost 40 base points. It’s great when you see both the global and local efforts reflected so clearly in the results, and the platform this creates for our ultimate objective - growth!

Global Marketing Capability Program™

Over the last 5 years, EffectiveBrands has developed the Global Marketing Capability Program™. In this discussion GSK’s experience and work emphasizes the importance of some of these phases.

Connect
From the outset, creating an interdependent global organization was top of mind for GSK. They carefully crafted their Future Teams to represent a true mix of both brand and market expertise. However, this initial structure still created friction between local and global as the two teams were measured and targeted to achieve conflicting objectives. Once recognized, the team worked hard to address the situation, creating a revised organizational structure with clearly aligned measures and targets. The organization has progressed leaps and bounds in this area in a relatively short time and the latest PulseCheck™ shows a new strong sense of ‘we are in this together’ and a ‘one team’ mentality.

Inspire
GSK holds the gold standard position in our study for inspiring around their brands. As Peter mentions, this is partly a factor of the industry - these are by nature brands that have a profound impact on the quality of people’s lives. But having said this, GSK does not rest on their laurels. They recognize the huge advantage that can be gained from capturing the hearts and minds of the organization and they ensure they tap into this to fuel brand growth. The annual ‘GO’ meeting brings together all the Future Team and Core Market top management. Initially, this meeting was simply an innovation show and tell event. Its new, revised role aims to inspire not just within brand, but across the brands and beyond brands, into ways of working and best practice.

Organize
In our experience it is quite typical that as organizations begin the journey from being autonomous and decentralized to being highly global, they start by focusing on ‘white space’ - typically innovation and best practice. Those that stay here are not truly realizing the benefits of working globally. What GSK quickly recognized was the need to evolve and drive for further efficiencies and effectiveness. They listened carefully to the organization and revised responsibilities for the Future Teams based as much on the needs of local markets as on the need to drive global efficiencies. Consequently the revised, broadened roles and responsibilities of the Future Teams were received extremely positively from both sides of the organization.
About EffectiveBrands™

EffectiveBrands is the only global marketing consultancy that
focuses specifically on the opportunities and challenges of
global brand marketers. EffectiveBrands helps marketing leaders
build global marketing capability and accelerate growth by
driving both global leverage and local relevance.
Our expertise is based on our practical work experience with
many of the world’s leading global brands as well as our
proprietary Leading Global Brands™ project.

www.effectivebrands.com

The Global Brand CEO - Starbucks and Dove

2008-05-17T12:38:00.000-04:00

http://www.effectivebrands.com

Building global marketing capability to accelerate brand growth

A Starbucks cappuccino is the same around the world, yet baristas from Singapore to Stuttgart ensure that the brand experience is an intensely personal one for local customers. Similarly, Dove’s breakthrough Real Beauty campaign, which challenged traditional beauty stereotypes while showing “real” women in their underwear, has been a success in more than 30 countries.

Despite intensifying local and global competition, Starbucks, Dove and many other leading global brands have seen sales grow steadily as a result of their ability to create one global voice and make that voice relevant to the local consumer.

Over the last seven years, EffectiveBrands has studied over 50 global brands closely and found that success is directly pegged to an important quality of the leaders of these brands: approaching work with the mindset of a Global Brand CEO. Instead of just focusing on developing effective global marketing mixes for their brands, the most successful marketing leaders also focus on building a global marketing capability for their organizations.

People like Karin Koonings, vp of marketing at Starbucks Coffee International, and Silvia Lagnado, former global brand VP at Dove, helped create long-term success for their brands, much as a good CEO creates continuity for a successful company. So, regardless of their actual titles, companies in search of global brand growth must put in place and support the efforts of a new breed of global brand leaders, the Global Brand CEOs.

GETTING GLOBAL MARKETING RIGHT

Grooming Global Brand CEOs like Koonings and Lagnado is crucial, as globalization has become arguably the most important marketing priority of the 21st century. The challenge for both the organization and brand leader is that the marketing qualities that led to the global job are not what determine success in the new role.

Our experience is that new global brand leaders are typically quite comfortable developing the “what” of global marketing: insights, innovation and communication. We found that what keeps many global brand leaders awake at night is the new challenge of global leverage—the “how” of global marketing: developing a single global brand strategy, enabling marketing team alignment, improving speed to market and building brand expertise across geographies.

It’s about leveraging global economies of scale and competition-mandated cost-efficiencies, satisfying consumers’ increasing demand for customized products and services, and satisfying local marketing and talent needs. The reward for solving this equation is substantial and sustainable growth for global brands—during the years that Lagnado led Dove, the brand almost doubled in global sales.

GLOBAL MARKETING CHALLENGES

Our experience is that the leaders of global brands often face very similar challenges as they work to increase global leverage—not the least of which is the ability to protect the universal truths that define their brand broad global consumer resonance. Another significant challenge is internal alignment around the brand’s mission and objectives. Interestingly, we often find that both local and global marketers are right about what will drive success for the brand, and that most disagreements can be explained by bad communication, and differences in vantage points and time horizons.

Even with the brand mission and brand strategy agreed upon, there is often a lack of alignment on what priority projects will best enable the brand objectives. Uncoordinated resources and “secret” regional projects go hand in hand with insufficiently resourced global projects and strike at the heart of the brand’s global competitiveness. The results are often subpar global innovation and increased market research costs as global marketers find local marketing colleagues “checking” that the global mix will actually deliver in their countries. Even more importantly, this often leads to unproductive behaviors that quickly spiral downward into a lack of willingness to focus sufficient resources on global projects.

But the biggest underlying challenge to address is often a lack of real trust, and interdependence between the local and global marketing teams. Local marketers often feel misunderstood and even disenfranchised by global marketers, who may be perceived as lacking understanding of the local market reality and having no accountability for actually landing initiatives in real markets.

BUILDING GLOBAL MARKETING CAPABILITY

Global Brand CEOs understand this dynamic instinctively and make it their job to evolve the organization from the traditional product, functional or geography-based orientation to one that builds sustainable growth by focusing on building the mindsets, behaviors and enablers required for success. We call this building global marketing capability.

The EffectiveBrands Global Marketing Capability Program™ was developed as a framework for successful global brand leadership. The Program promotes global brand success by encouraging leaders to focus on the mindsets, behaviors and enablers that accelerate global marketing effectiveness: Connect, Inspire, Focus, Organize and Build.

CONNECT: Building interdependence

Succeeding globally means that it is crucial to ensure that all players share a common understanding of the market realities at local and global levels. Connecting is about building understanding, trust and interdependence. Local teams want to know that their market’s success is what drives the global team’s work and global teams want to see that looking for similarities, rather than differences, is the prevailing mindset among local teams.

When Koonings first joined Starbucks’ international marketing team, she found that the team’s internal clients—local marketers around the world—were largely unimpressed by the team’s previous efforts to support themarkets. It was felt that the U.S.-based internal marketing team lacked understanding of what was happening outside the United States. Koonings therefore made it her firsorder of business to connect personally with regional and local teams to listen and determine firsthand their challenges and opportunities. She then briefed her teams to better connect with international markets via regular personal visits, telephone calls and new “functional forums” at corporate and in regions to offer strategic planning as often as possible.

Koonings also initiated an annual online global brand benchmark: a quantitative survey reaching out to all global and local marketers to understand how better global alignment could lead to better results in market.

Koonings took connecting disparate markets a step further by promoting rotational assignments among employee “partners,” offering them the chance to rotate to other markets. Such connection is crucially important since Starbucks, which opened its first location outside of the United States in 1996, now operates in over 40 countries and is projected to double the number of international stores within just a few years.

Lagnado likewise faced massive challenges in trying to connect long-autonomous local marketing directors from each region when she became the global lead for Dove in 2001. Dove was Unilever’s first brand ever to be assigned a dedicated global brand team. In the end, she initiated the successful alignment of some 600 Unilever marketers and their ad agency counterparts behind the single, focused Real Beauty strategy by creating a Dove Board, a team that included five marketers from each of the brand’s key regions, and by institutionalizing the regular updates between the global and local teams with the creation of Top 10 Market Summits.

INSPIRE: Energize passion around the brand

At EffectiveBrands, we have found that behind every successful global brand is the gem of a universal insight that not only attracts consumers but also has the power to inspire all who work with the brand. Over time, these “truths” can become lost or hidden through too many marketers or positioning consultancies wanting to make their mark by changing something. It often takes a significant peeling-of-the-onion exercise and strong leadership focus to get back to a simple formulation that is understood in all languages and hits the universal sweet spot.

Successful leaders of global brands instinctively understand the importance of energizing passion for the brand internally and go out of their way to ensure that it powers the growth of the brand. Dove’s Campaign for Real Beauty did just that. Research unearthed that only 2 percent of women in the world felt comfortable saying they were beautiful, and that even young girls felt fat. From that insight, Lagnado and her team derived the importance of building women’s self-esteem, seeing it as their mission to forge a stronger emotional bond between its brand and women around the world. The simple concept was a surefire hit, inspiring and rallying not just consumers but also all Dove marketers around the globe, many of whom are women or have mothers, sisters or daughters.

But it wasn’t only the message. It was the way the message was communicated that helped Lagnado to mobilize the organization globally with conferences, web chats, newsletters and personal interactions. She was careful not to be perceived as “selling” her vision for the brand too much - instead employing what we call Global Brand Servant Leadership: combining a genuine in-depth focus on key markets and concern for addressing those local marketers’ needs with very clear communication of the non-negotiable global brand direction. Lagnado made it her job to elicit feedback early on and create an atmosphere where local and global marketers were both challenged and celebrated for applying their expertise and ensure successful program development and delivery.

FOCUS: Set global brand priorities that win big

Vigilant focus and commitment to an agreed-upon set of global brand priorities are crucial to the success of the global brand. Inconsistency often leads to lower quality and higher costs and “global” initiatives lacking the boldness and quality required for success.

For Dove, focusing the global brand team meant ruthlessly consolidating five regionally distinct brand plans into a one-page global brand strategy document to create clarity around its brand vision, mission and strategy. The “Dove One-Pager,” which has become something of a legend at Unilever, defines what everyone now working on Dove lives and breathes. Lagnado also dramatically reduced the number of innovation projects globally from 400 to fewer than 20 to ensure that adequate resourcing for success was in place.

Likewise, to stay focused on the global message, Starbucks consolidated the multitude of regional initiatives into a single international promotion calendar. Developed by the international team in conjunction with regional support teams, this calendar agenda is rolled out and implemented by local marketing teams across the globe. Such continuity has helped Starbucks fulfill its brand promise of exceptional customer service and fuel its explosive international growth.

ORGANIZE: Clarify and enforce roles and responsibilities

The biggest pitfall that the companies we have studied struggle with is the failure to clarify roles and responsibilities early on. Many global brand organizations get stuck in a consensus-driven culture and lack the courage to give full decision-making responsibility to only those accountable. Defining the operating model and roles on key decisions is important, but enforcing
the model and required behaviors is even more important. If behaviors inconsistent with the new operating model are tolerated, particularly among leaders, this will cause significant delay and frustration.

When Lagnado started her job, Dove had held quarterly global brand team meetings where 30 people would get together to exchange ideas, but no decisions were made. Creating an empowered Dove Board of seven that took global responsibility for one Dove strategy was the turning point for the brand’s success. This included giving global responsibilities for global decisions like advertising development to regional brand leaders. The work was divided up among the board members, but the full alignment amongst members ensured that there was just one voice on any topic.

In the case of Starbucks, Koonings brought all regional marketing leaders together for a two-day summit and facilitated explicit agreement on who was in the lead and who followed for all key brand decision-making processes. Although uncomfortable at first, the sessions created enormous transparency, trust and agreements on team behaviors moving forward.

Many global brands are transitioning innovation and communication development responsibilities away from the countries and into global brand teams. The consistency, cost and speed arguments for this are strong. Such a shift allows companies to decrease local staff levels and increase the focus on local market activation. Sadly, often far too little attention is given to recognizing the crucial importance of local marketers who are driving brand growth through the brand’s local activation programs.

Communicating the strategic importance of the refocused local marketing activation role, driving new marketing excellence programs to increase organizational capability in this area and celebrating the successes of activation leaders will ensure that global-local transitions happen more smoothly and that key local marketing talent is retained.

BUILD: Harvesting and leveraging brand expertise

Maintaining brand consistency over time, avoiding the reinvention of programs, and accelerating the rollout of successful brand programs globally make up some of the biggest challenges for a Global Brand CEO. Without these, the advantages of global leverage to drive competitive advantage against local and retailer brands are quickly lost.

Global success is accelerated when a brand’s marketers everywhere speak one language, and are willing and equipped to quickly build on each other’s successes and mistakes. This requires the cultivation of a learning mindset with marketers willing to share and listen, and can be achieved only if the brand’s leaders are setting the example, turning around limiting mindsets, rewarding the right behaviors and putting the enablers in place to make it happen smoothly.

Successful global brand leaders give high priority to educating anyone who touches the brand, and creating a platform for the harvesting and sharing of learning from those countries that got it right—or wrong—allowing marketers in other countries to quickly learn from and apply the experience.

To accelerate Starbucks’ continued global expansion, Koonings recognized that it would be crucial to have the tools in place to maintain the consistency of marketing programs around the world. She created a marketing excellence program called The Starbucks Learning Series to build marketing skills for local marketers and create an exchange platform for practical experience. Koonings also launched a monthly “Spark” internal newsletter to share best practices.

Similarly, the Dove Board worked very closely with the leader of Unilever marketing knowledge management to create the Dove Planet, a brand intranet that addresses all significant brand questions and shares in-depth experience, results and guidelines.

GET GOING GLOBAL

Going global is no longer a choice for most brands. Globalization is happening, and the most important question for global brand leaders today has become how to leverage scale and at the same time increase local competitiveness.

Lagnado must have done something right: When archrival P&G’s CEO Jim Stengel, was asked to identify the competitor he most respected, he focused on the significant global growth of Dove and the Real Beauty campaign. Similarly, Starbucks international growth has pushed the company from 5,000 to over 12,000 stores worldwide in just under five years. “We have been amazed by the global acceptance and visibility of our brand in all our international markets,” says Howard Schultz, chairman and chief global strategist, on the company’s website.

We believe Lagnado and Koonings are at the head of the pack of successful global brand leaders precisely because they focus on the building of global marketing capability. Their work has resulted in extraordinary international growth for their brands and clearly demonstrates the importance of adopting the mindset of a Global Brand CEO. Can you afford not to?

© Copyright EffectiveBrands 2008

About EffectiveBrands
EffectiveBrands is the only global marketing consultancy that focuses specifically on the opportunities and challenges of global brand marketers.

EffectiveBrands helps marketing leaders build global marketing capability and accelerate growth by driving both global leverage and local relevance.
EffectiveBrands clients include Starbucks, Dove, Tom Tom, Unilever, ING, Cadbury-Schweppes, GSK, Mars and Coca-Cola.

About the Leading Global Brands™ project
The Leading Global Brands study includes contributions from over 50 global brands, 500 global brand leaders and 5,000 global brand marketers and focuses on accelerating global brand growth by increasing global brand leadership effectiveness.

http://www.effectivebrands.com

Making Dove Fly Higher

2008-05-05T13:23:00.000-04:00

Leading Global Brands Bulletin

http://www.effectivebrands.com

To date, over 250 global brand marketers from over 50
global brands have participated in an exciting learning
project on Leading Global Brands. All participants are the
CEO, Chief Marketing Officer, Global/Regional Brand
Director, or local Brand Director of a global brand. They
all share a desire to be thought leaders in developing
ideas and best practices for leading the global brands of
the future.

Making Dove Fly Higher

The focus of this month’s Leading Global Brands Bulletin is on how
the Dove Global Brand Team was able to overcome organizational
challenges, launch a winning new global marketing campaign
around the world, and partner with the U.S. Dove team. In doing
so, Dove was able to effectively leverage learning from other
countries to develop a U.S. specific marketing program that has
won praise both internally and externally, and accelerated the 50
year old brand to over significant growth in 2005.

Alessandro Manfredi is Vice President of Dove Global Masterbrand
and has been a part of the Dove Leadership Team for over 4 years.
Over the last 3 years Alessandro has led the development and
global roll-out of the Dove Campaign for Real Beauty. In his 11
years at Unilever, he has worked in Italy, the U.S. and the UK. Prior
to Unilever, he spent a year in Brussels working as a lecturer and
researcher on marketing and communications for Bocconi
University. Alessandro was born in Florence, Italy.

Philippe Harousseau is the U.S. Marketing Director Dove Skin &
Masterbrand. In 2005 Philippe led the launch of Dove's Campaign
for Real Beauty in the U.S. Philippe has worked for Unilever for 17
years, in Paris, London and New York locations, as well as currently
in Greenwich, CT.

The Dove Campaign for Real Beauty (CFRB) has received
enormous attention from consumers and press worldwide by raising
awareness around Dove's mission to make women feel more
beautiful every day by challenging today's stereotypical view of
beauty and inspiring women to take great care of themselves. The
campaign has been launched in over 30 countries and has led to
significant consumer recognition and sales growth.

EffectiveBrands: Can you describe how and why the work on
the Campaign for Real Beauty actually started?

Manfredi: I remember it very well. Dove was the first Unilever
brand to be assigned a dedicated Global Brand Team some 5 years
ago. We were still discovering our role and about 25 people,
including most members of the new global team, but also some
regional and local team members attended an intensive Unilever
leadership course in late 2002. After many soul-searching team
sessions, the question that kept coming back was ‘What is Dove’s
philosophy on beauty?’ Looking deeper into the question of beauty,
the team discovered that only 2% of women were comfortable with
saying that they are beautiful, and that there are girls as young as
pre-teen who ‘feel’ fat. We made the connection to our brand and
decided that we would make a real difference, and build the brand
in a way that would have a real impact on society. With Dove we
felt like we had a brand with the potential to truly connect to
people, and that long term our 1⁄4 moisturizing cream claim alone
was just not going to cut it.

Harousseau: Everyday we see models in magazines and on
television that have ‘perfect’ bodies and flawless skin. There are
few examples out there to counter the belief that these images
define attractiveness in women and the lack of balance erodes selfesteem
over time. We didn’t want to be a part of perpetuating a
stereotype. The Campaign for Real Beauty seeks to put balance
back into the perceptions of women that are created by public
images and messages. We are interested in helping to build rather
than erode self-esteem, so that women are encouraged to love
themselves for their individuality.

Manfredi: Of course we are not a charity; we recognized
immediately that the CFRB presented an opportunity to have a
positive impact on society, get closer to Dove’s original roots, and
build our business by creating a stronger emotional bond with our
consumers. Real beauty is relevant to all women.

EffectiveBrands: You mentioned a new Global Brand Team.
How were you organized at the time and did this help or
hinder your success?

Manfredi: At the time we were the first Dove Global Brand Team
and no one knew exactly what we were supposed to do. We were a
small dedicated team of 5 in the center with dotted lines to all of
the various regions. Dove marketers in each country reported
formally to their country business unit heads and only informally to
the Global Brand Team. We recognized that we could not just push
through our ideas, so we set out to win the trust of our
stakeholders with a mix of strategic persuasion and very concrete
business results from early pilot markets.

EffectiveBrands: These ideas represented a radical deviation
from what competitors and Dove itself have been doing for
years. How did you address the worries and resistance by
people that wanted to stick with the status quo?

Manfredi: Taking this on was a bold move at the time, but it was
something that a few of us felt very passionate about bringing to life. Our
first focus was to lock down and start communicating the brand positioning in a way that would inspire all Dove marketers around the world to support the work. Our brand
stewardship workshops on every continent ensured that the word was out and we had the attention of marketers in over 50 countries. We also quickly started engaging with the many
important internal and external stakeholders that we needed on our
side.

The mindset behind our approach was one of Servant Leadership.
We felt that as a Global Brand Team we had a duty to present a
clear strategic direction for the brand that was basically nonnegotiable,
but at the same time we really needed to listen and understand genuine concerns and practical needs so that we could develop solutions that addressed them. Once these were clear we
had our work cut out.

EffectiveBrands: Did the workshops provide you with enough
understanding of the countries’ support needs from you as a
Global Brand Team?

Manfredi: Not really. We had a lot to share and we recognized
that everyone needed some time to think through the new strategy
and consider the practical implications for their market. This is why
we decided to do a Global Brand Benchmark Study. This benchmark
involved reaching out to our marketers at all levels across some
12-15 Dove countries to really understand where the global and
regional brand teams were adding value to the markets, and where
we were actually getting in the way of them doing their local jobs
effectively. We also compared our global role to that of relevant
competitors and other companies we felt we could learn from.
The study gave us a real understanding of what to focus on. In
addition there was an immediate spin-off: just the fact that we
were asking the questions instantly improved our relationship with
many country teams. To them it was a clear signal that we
recognized that global branding has to be about than local
business.

EffectiveBrands: One of the survey conclusions was that
there was significant confusion around the priorities and
roles & responsibilities on the brand. How did you go about
addressing this?

Manfredi: It’s true. Up to this moment we had held quarterly
Global Brand team meetings where 30 people from around the
world would show up and exchange ideas. Although interesting,
these meetings were far from effective because we did not really
take decisions. Different regions had different priorities and the
new structure with dotted lines created a lot of confusion so we
decided to take this head on and make the changes needed to
make the structure work for the brand.

EffectiveBrands helped us organize a ‘new style’ Global Brand Team
meeting in 2003 where together we prioritized key global brand
team initiatives based on the Global Brand Benchmark findings and
agreed to empower a subset of the team to develop a new brand
operating model and lock down a single global brand strategy.
Soon after we created the Dove Board – a team of seven marketers
representing all important Dove regions, but taking responsibility
for one global Dove strategy. I am sure that this was the turning
point of our success.

EffectiveBrands: Why did creating this board make such a
difference?

Manfredi: It only took us two days to go work through a ‘Pyramid’
process and define our new brand vision, mission and strategy, and
by working together we built an unprecedented level of trust among
the members. The global brand strategy became known as the
Dove “One-pager” a document that everyone across the Dove world
now lives and breathes.

We also began to run the brand in a much more effective manner.
There were weekly conference calls for the Board to discuss and
align, regular web conferences to communicate with all important
marketers in key countries, and we created ‘Planet Dove’ – an
Intranet site used to gather and distribute best implementation
practices from all over the World.

In 2003 and early 2004 Campaign for Real Beauty pilots were run
in three smaller countries. The new Dove Board members worked
side by side to communicate and convince senior stakeholders
across the whole company that it was time to move from pilots to
full scale roll-out. Although initially results were mixed because we
did not have the advertising right yet, results improved
dramatically as local marketers became passionate about the
campaign and developed exciting local activation programs to bring
the campaign alive. It became like a wild-fire.

EffectiveBrands: You have described 2004 as the turning
point for the Campaign for Real Beauty, why is that?

Manfredi: 2004 was the year that the Campaign for Real Beauty
was launched in some of the biggest markets outside the U.S. Both
the U.K. and German markets quickly reported back huge success.
And finally the U.S., our largest market started taking on the
Campaign for Real Beauty.

I had a personal interest in ensuring Dove’s success in the U.S.
market. Even though I was a member of the global team, I was
based in the U.S. and sat on the same floor as the U.S. marketing
team. I knew that if I ever wanted to consider myself a good Global
Brand Manager, I would have to help the U.S. succeed. I saw an
opportunity to boost the relationship between the global team and
arguably our most important local ‘customer’.

Harousseau: Toward the middle of 2004 a number of factors
facilitated the adoption of the campaign in the U.S. We saw the
Campaign for Real Beauty roll out in the pilot markets and its
success in the U.K. It was clear that the global team had cracked
the advertising. The strategy was solid and that it wasn’t likely to
change. We felt the time was ripe to leverage the global success in
our market.

Our new was team comprised of people with non-traditional
marketing backgrounds, which gave us an opportunity to think
about the CFRB differently. One of the first things we decided was
to build a stronger relationship with Dove’s Global Brand Team so
that we could leverage the learning from other countries to our full
advantage.

EffectiveBrands: How did you translate the new Dove global
strategy into a local market plan?

Harousseau: The simple message of ‘real beauty’ helped us to
rally people behind our cause. Connecting women with our message
was our primary focus. In our advertising, we considered using the
same advertising that ran in the U.K., but ultimately decided that
we wanted to use American women in our advertising to make the
ad feel more ‘real’ to American consumers and to create local
‘celebrities’. Again, our strong relationship with the Global Brand
Team allowed us to have an open debate on the pros and cons of
developing new ads for the U.S. and they supported our decision.

The women were featured in our ‘Firming’ ad in their underwear. As
the media caught on to the campaign, the women were interviewed
and featured on many of the most important TV show in the US.

EffectiveBrands: You recently ran an ad about girls’ selfesteem
during the Super Bowl. Was that also based on an
idea from another country?

Harousseau: Yes and no. The idea of the “little girls” campaign
was actually created in Canada. But the idea to put the ad next a
male dominated TV event like the Super bowl came out of the US
team. I think it is a great example to demonstrate that we are truly
working as an effective global brand. We are not just copying ideas
from other places. Instead, we are leveraging a global platform and
making it completely locally relevant. The platform of debunking
beauty is global. In America we felt we could not do it in a more
challenging way then airing an ad about daughters with self esteem
issues during the quintessential male sport event on television.

The Super Bowl ad gave us exposure to 90 million people and
created enormous buzz. The specific ad talking about girls’ selfesteem
allowed us to break through the clutter of boorish and
childish beer, soda and financial services ads. Ultimately, it gave us
the opportunity to raise awareness of the Campaign for Real Beauty
and drive growth across all Dove categories.

Principles of Effective Global Brand Leadership

Over the last 4 years, EffectiveBrands has developed The Eight
Principles of Effective Brands. In this discussion, Alessandro and
Philippe emphasize four of the principles of leading global brands
that were most related to their success:

Adopting a Servant Leadership Mindset
By actively incorporating a Servant Leadership management style
early in process, the Dove Global Brand Team recognized the
importance of developing trusting relationships with Dove
marketers in each country. Similarly, Philippe Harousseau’s team
actively sought to build trust and increase collaboration with the
Global Brand Team. This allowed the freedom to try bold new
initiatives and grow the Dove business in the U.S.

Creating absolute Clarity on Roles & Responsibilities
When it was unclear who should or could do what the leaders of
Dove went beyond the formal structure and decided how they
were going to collaborate more effectively. Later on it was clearly
agreed between global and local teams the role that each would
play.

Focusing the Global Brand Team
The Global Brand Benchmark helped focus the Global Brand Team
and served as a basis for prioritizing the brand activities. The
Dove one-pager strategy document and brand stewardship
workshops were opportunities for Dove marketers around the
World to understand what to focus on and how to learn from
other countries.

Inspiring Personal Commitment to the Brand
The philosophy behind Campaign for Real Beauty touched
something in each of the members of the Global Brand Team and
all local Dove marketers. As a result, each of them made a
personal commitment to bring the philosophy to life. Part of this
included communicating the new philosophy to other Dove
marketers across the globe to create buy-in for the new direction
of the Dove brand. In the U.S. the Dove team made personal
commitments to ensuring the success of the Dove brand in their
market. Everyone was proud to work on Dove because the brand
was doing something to help a greater cause – building women’s
self-esteem.

About EffectiveBrands
EffectiveBrands focuses exclusively on serving the unique
opportunities and challenges faced by marketers of global brands.
We provide effective solutions for global marketing organization
capability development.

With offices in New York, London and Amsterdam and working with
a world-wide network of expert partner consultants, we have
achieved outstanding results and client satisfaction on global
marketing projects for a wide range of industry leaders.

For more information, please visit our website at
http://www.effectivebrands.com

Starbucks Bulletin

2008-05-01T13:00:00.000-04:00

Karin Koonings, Vice President of Marketing, Starbucks Coffee International, leads the international brand marketing team and is responsible for setting the priorities and developing the plans to support company brand strategy and business objectives around the world.

Starbucks
Abuzz About Global Growth

The focus of this Leading Global Brands Bulletin is on how the worlds most popular coffee brand stays connected to local marketing needs and leverages expertise across the globe in a way that builds local marketing capability and fuels the organizations international growth.

Starbucks Coffee Company (NASDAQ: SBUX) was founded in 1971, opening its first location in Seattles Pike Place Market. Twenty−five years later, in 1996, Starbucks opened its first overseas location in Tokyo, Japan. Today, with nearly 12,500 stores in 39 countries, Starbucks is quickly becoming one of the most recognized and respected brands in the world.

Karin Koonings team of marketing and communications professionals create seasonal marketing programs and promotions, oversees communications, CSR and PR initiatives, and shares best practices from the international community for the overall benefit of the brand globally. The team acts as global stewards of the brand, working with the local teams in each of the regions to ensure that all expressions of the brand are consistent with the brand positioning and promise. Karin started her career in Canada with Starbucks in 1996 as the companys very first field marketing manager.

EB: Everybody knows about Starbucks' US success, but your expansion overseas is relatively recent. How important is International to the Starbucks business?

KK: International is poised to contribute significantly to Starbucks overall growth. Once a U.S. company that operated internationally, Starbucks is now a truly global company. We are a young global brand that built its success in the U.S., and the U.S. market activities, trends, and ideas still play a dominant role. Having said that, its clear that our future growth will largely be shaped by our international business. China is set to be our largest market outside the United States, we just opened Brazil and Egypt, and India and Russia are next on the horizon, so there are many reasons to be excited about Starbucks growth internationally.

EB: When you started your job, how well connected was the international marketing team to the needs of the local and regional marketing teams?

KK: I came to this role from a field position in North America and was used to working quite autonomously within the boundaries of strategic programs that had been defined by Seattle. The Support Center understood our markets and developed programs that we would implement with local creativity and surround with local marketing initiatives. This is why the brand is so well connected with the communities in which we operate. Our grassroots marketing has made us successful. When I joined Starbucks Coffee International, I made it a priority to build a team that would connect with and provide substantive support to our international markets, while at the same time affording them the flexibility to engage their communities in ways that were locally relevant. I think we have done a terrific job of relating to one another, sharing best practices, and getting together as often as possible for one−on−one interaction and strategic planning.

We have made a lot of progress toward better understanding and delivering against our markets needs. Were taking our progress a step further by offering international rotational assignments to our partners, so a partner from Seattle may go to a regional office or market for a six−month assignment or someone from one of our international markets will come to Seattle. Its like an exchange program that provides the opportunity for the reciprocal sharing of knowledge and expertise.

EB: How did you go about getting better connected with the local markets and were your initiatives successful?

KK: Starbucks is in the people business serving coffee, which is why we believe in that personal human connection, not just in our stores but with one another as fellow partners (employees). When I came to the Support Center, I made it a priority to connect personally with the regional teams and learn first hand what their challenges and opportunities were. It involved a lot of travel to all corners of the world and a lot of listening, which I think our markets appreciated.

Also, as I mentioned earlier, we are offering international rotational assignments for our partners in marketing and communications. We also stay in close contact with our markets − even in spite of the many time zones. We have regular calls, travel as often as is necessary, and host regular marketing and communications immersions in Seattle and elsewhere. We also rely on our Regional Support Centers to work closely with their markets.

In addition, the commissioning of the EffectiveBrands Global Brand Benchmark has helped our teams become more outside−in focused. The Benchmark was aimed at almost everyone who works in marketing for Starbucks around the world. We asked our marketing representatives in each country to rate SCIs performance against key drivers of Global Brand Capability Program effectiveness. The survey results have created a completely new level of transparency and measurable accountability around the effectiveness of our international marketing support.

The Benchmark findings really helped us to step back and view our work from the perspective of those on the receiving end. Although most of the findings were very encouraging, with extremely high scores for brand inspiration and growth potential, there were clearly areas where we could make changes to help accelerate our growth. The process of drafting and learning from the Benchmark brought the regional and central support teams closer. It was clear that countries saw us as one, and that we were going to divide and conquer to deliver against our overall business needs and objectives.

EB: Can you explain a bit more about this "dividing and conquering to deliver?"

KK: Until recently, every geographic region operated fairly autonomously. Take an area like marketing training. Sharing marketing programs and ideas happened at regional forums where marketers from the most important countries facilitated the meetings. There was little or no sharing across regions.

The Benchmark helped us pinpoint the areas of marketing skills and development needed by all marketers across Starbucks Coffee International. Together with the regional marketing teams, we developed ONE international training agenda. The team in Seattle is spearheading the development of the marketing training programs and the regional teams are charged with roll−out and implementation support. This has been a tremendously efficient and effective approach that has allowed us to put in place dedicated marketing capability development resources for the first time. The new Starbucks Learning Series is being received with enthusiasm across the globe!

EB: Starbucks seems to have been very successful at maintaining and globally leveraging brand consistency. At the same time you mentioned the importance of grass roots programs to build local relevancy. Arent these two contradictory goals?

KK: Our brand promise of providing the highest quality coffee, exceptional customer service, and a truly uplifting Starbucks Experience is the same around the world. We continue to spend a lot of time sharing on Brand Stewardship programs that explain to our partners worldwide what the company and brand stand for and challenging them to bring that to life in their respective markets. The way our stores and our store partners (baristas) connect with their customers and the communities in which we operate is what makes Starbucks unique and locally relevant.

Our marketers everywhere are always looking for ways to connect to their communities and in ways that make a difference. I dont think there is another global brand that runs the breadth and diversity of local marketing programs that we do. But all programs deliver against our core values and business principles, providing the consistency that our customers have learned to recognize and expect.

EB: Many global marketers tell us that they feel somewhat isolated in their companies because they dont have many colleagues that share their challenge of correctly balancing local relevance with global leverage. Do you recognize this predicament?

KK: Absolutely. I felt pretty much the same way for at least the first year of my job. I dont think there were many people in the company that fully understood the challenge. But I have to say that this feeling is far behind me now. Working more closely with colleagues responsible for global category (food, beverage, and product) management and innovation and, most importantly, my regional marketing colleagues have helped us all see and share the same goals. Together we have found that leveraging global programs is precisely what local markets want. It stops them from having to reinvent the wheel−which is costly and time consuming for them−and frees them up to focus on the things that help them create local programs that connect with their customers and communities. A balance of global leverage and local relevance has made everyones life a lot easier, more productive and, frankly, more fun! I'm proud to work at Starbucks. This is an exciting time to be here and to be in International. Looking ahead−six months, one year, 10 years down the road−there is so much to be excited about.

Global Marketing Capability Program

Over the last 5 years, EffectiveBrands has developed the Global Marketing Capability Program. In this discussion, as head of the Starbucks Coffee International Marketing team, Karins experiences and work emphasizes the importance of some of these phases:

Connect - creating interdependency
Karin worked hard to understand what the markets wanted and needed, doing "a lot of listening" when she first assumed the role. Her first challenge was to ensure that the international and regional marketing teams shared common goals and were committed to sharing responsibility to drive the same objectives. Today they have clear alignment on roles and responsibilities in order to achieve these objectives. The markets expect the International team to deliver high quality global programs which are continuously and consistently leveraged. In exchange, local markets are better positioned to focus on initiatives that connect Starbucks to their immediate communities with locally relevant programs and promotions that have been a key success factor for Starbucks from the start.

Inspire - harnessing brand passion
Since its inception, the Starbucks brand has communicated the passion for coffee and community held by everyone in the organization. From Howard Schultz to the barista in a coastal Maine town who breaks out into song when calling out ready orders for customers, Starbucks harnesses its brand passion through stories that illustrate the unwavering personality and values of the brand. Ultimately, brand passion translates into winning market programs that drive loyalty and growth for the company as a whole.

Build - harvesting and leveraging capabilities and best practices
The results of the Global Brand Benchmark reinforced a strong desire for learning and leveraging across regions, especially from markets that were at similar stages of development. Building on regional forums already in place to share best practices within regions, Starbucks began thinking more globally about how to build its marketing capability and create consistency and excellence around the world. The Global Brand Benchmark also revealed that marketing skills development was a focus area requested by marketers from all regions, and provided the impetus and vital input into the creation of a new Starbucks marketing university called the Starbucks Learning Series. Finally, the global team is leading another initiative to offer international rotations assignments in order to enable markets to share learning and expertise around the world.

EffectiveBrands is the only global marketing consultancy that focuses specifically on the opportunities and challenges of global brand marketers. EffectiveBrands helps marketing leaders build global marketing capability and accelerate growth by driving both global leverage and local relevance.

Our expertise is based on our practical work experience with many of the world's leading global brands as well as our proprietary Leading Global Brands project.

http://www.effectivebrands.com

Global Brand Management in the Pepsi Generation

2008-04-25T14:00:00.000-04:00

Leading Global Brands Bulletin

http://www.effectivebrands.com

Antonio Lucio

To date, over 65 global brand executives have
participated in an exciting learning project on
Leading Global Brands. All participants are the CEO,
Chief Marketing Officer, or Global Brand Director of
a global brand. They all share a desire to be
thought leaders in developing ideas and best
practices for leading the global brands of the
future.

Pepsi
Global Brand Management in the
Pepsi Generation

This Bulletin features a conversation between EffectiveBrands
(EB) and Antonio Lucio (AL) of PepsiCo, Inc. where we
discuss Pepsi’s operating model and philosophy on the role of
the global marketing team.

Antonio Lucio is the Senior Vice President Insights and
Innovation at PepsiCo, Inc. In his role since January 2005, he
drives the growth agenda across all divisions. At the time of
this interview, Mr. Lucio was the Senior Vice President and
Chief Marketing Officer of Pepsi-Cola International, a division
of PepsiCo, Inc. He was responsible for leading the
development and implementation of all global brand
marketing programs and initiatives for the beverage
portfolio. The only market for which he was not responsible
was the U.S.

Prior to PepsiCo Mr. Lucio had 15 years of consumer goods
experience with Procter and Gamble and Phillip Morris' Kraft
General Foods.

EB: To start, would you give me an overview of how
your organization is structured and your operating
model?

AL: We operate under a “local relevance” with “global scale”
model. We are a very fast-growing company – the fastest
growing international beverage company – but we are the #2
player. For us, maximizing scale when competing is of the
essence.
How do we work? Everyone on our central team, by
design, comes from our field operations. This provides
instant credibility of our work to our field operations. I don’t
bring international marketers from the outside world to do
isolated, ivory tower type analyses and program
development. Globally, my central group owns positioning,
formulation, label design, and packaging parameters. We
also deliver a comprehensive package of tools and programs
every year: global advertising, new product options,
promotional platform, and merchandising solutions. The way
in which we go about it is different. We operate through a
bottom-up, highly participatory and interactive process. It is
lengthy and time-consuming, but highly effective.

A. Several times a year, we gather marketers from our
key markets to identify needs and provide input to
everything we do at the center and at each and every
step of the development process – from advertising to
product development.

B. We believe in 360° marketing for all of our brands.
This means consistency and concurrency of all the
aspects of the marketing mix. To do this, we have
enlisted a very select group of partners and agencies.
Our key account planner is the Chairman of BBDO,
Allen Rosenshine. He is able to leverage a network of
centers of excellence from around the world to deliver
a global pool that drives 360° marketing. That means
all spots are designed with “the store” in mind. As the
advertising pools are developed, our alternate media
and below-the-line groups get to work to present a
comprehensive 360° approach to the brands.

C. All of this is delivered to our field in June. From July
through September, our field supplements and plans
implementation of the next year’s activities.

EB: So with respect to your group’s role it appears that
in one case you’re directive, and in another you’re
more of a service organization. Is that how you see it?

AL: Definitely. We’re directive in terms of strategy, but we’re
a service supplier in terms of marketing deliverables:
advertising, products, innovation and promotional platforms.
Our goal is clear: if we cannot provide goods that are
significantly above what a market or region can provide on
its own, then we just “don’t do it”.

EB: Who judges your success?

AL: Our success is measured in the business results of our
markets. We also judge it by the usage of the programs and
tools that have been centrally developed.

EB: Is there a steering committee of countries that
drives what you do and sets an agenda at the center?

AL: Yes, there is a committee – consisting of people from the
top 29 countries around the world – that drives everything
we do. We also have a smaller operating group, consisting of
7 Regional Vice Presidents and 4 core brand VP’s from the
center who make final decisions on the work developed by
the top 29 team. Then, if there is a discrepancy, I cast the
final vote.

EB: In the areas of strategy positioning, I’m sure you
have bottlers who have ideas that clash with your
own. How do you address those issues?

AL: The concept is to provide role clarity: what is
it that they do and what is it that we do. We are
responsible for the brands, and they are responsible for the
manufacture, sale, and delivery of the product.

We’ve created a joint planning process that brings together
bottler and franchise houses on a day-to-day basis, where
they look at the trends together to reach conclusions and
indicate actions on all elements of the brand business. It all
boils down to fact-based analysis and joint planning. If
conflict is not sorted through this process, then the franchise
house will make the final decision on brand-related matters,
and the bottler will rule in operations.

EB: Through our work, we’ve observed that marketing
organizations typically split between development and
activation. P&G has found a way to re-invent the local
marketing position. It involves the division of roles &
responsibilities and a better understanding of what’s
important to a marketer in each situation. What role
does local marketing play at Pepsi?

AL: I haven’t seen this happening at PepsiCo because our
organization handles this differently. At Pepsi, the local
marketer owns the branding locally: the actual manifestation
of the positioning statement within the context of his/her
particular market. What we, at the center, do is to provide a
menu of programs that first and foremost, those local guys
helped develop.

The 29-people team has dual roles: activation in the local
market and joint development of a global platform. For
example, we have a global soccer platform. The local
marketers helped develop the platform for global use. They
also take it and adapt it to their own local markets by
supplementing it with local players and activation programs.
Our local marketer feels that he totally owns branding: he
helped develop global programs and is 100% responsible for
the local activation.

EB: When you travel do you always meet with both the
marketers and the bottlers? When you came into this
role, how did you build relationships to begin working
with and leading these people?

AL: Yes, I meet with both marketers and bottlers when I
travel. In our particular case, given the dynamics of our
business, the only approach that works is “Leadership by
Influencing.”

In order to be successful in this style, you need to have a
strong command of several things:

1. Knowledge of what the brand essence is today in that
market

2. Knowledge of what the brand essence should be
tomorrow

3. Knowledge of the local market conditions and

4. Awareness of the relationship between the franchise
house and the bottler.

At the end of that interaction, if both bottler and franchisee
felt that you added value to the local agenda, then you were
successful in your visit.

EB: The ability to claim thought leadership comes up
often in other interviews. How do you ensure that
what you are doing is of better quality than what key
markets could develop?

AL: Ultimately, the access to a wide network of best-inclass
international support agencies – advertising,
promotional, packaging, etc. – together with the level of
centralized funds that we can assign to a project, will result
in a superior project that our local countries can’t do on their
own. To ensure that that is the case, the global work is
tested in all our key top 29 markets. The norm is clear:
global work has to obtain best-in-class scores in our local
markets…otherwise it does not work!

EB: Sometimes local countries (e.g., Brazil), in tandem
with local agencies, are able to come up with great
programs. Do you have any thoughts on this?

AL: Three thoughts. First, we work with centers of creative
excellence that deliver our global goals and drive the local
agenda. In the example you mentioned, Brazil is one of our
centers of excellence. The work done by Brazil is leveraged
both locally and globally.

Second, outstanding local work is also showcased as best
practices with our markets.

Finally, sometimes even a key local market is supported
financially by the center to deliver projects with multicountry
locations. We run a highly fluid and interactive
process that enables us to maximize global and local
resources.

EB: On the pitfalls to avoid, you’ve been at Kraft and
P&G, so you’ve seen how different operating models
work with global brands. What are the 3 things to
really watch out for when you’re in a global brand
role?

AL: Only two things are critical in our book: ownership and
participation by the field organization.

By getting the field involved in the development of the global
agenda, they feel that they own it. It’s as simple and as
complicated as that. When our process hasn’t worked, it’s
because the people who were in charge of activating the
brand at a local level didn’t feel that they owned it.

EB: What advice would you give to your peers who
travel around and meet with local markets, to help
build those networks?

AL: Be there often. Get immersed in the local numbers.
Listen and always build bridges between the local agendas
and the global priorities. When in doubt, trust the field. And
always, always make a point to add value… to the local
agenda.

Principles of Effective Global Brand
Leadership

Over the last 4 years, EffectiveBrands has developed The 8
Principles of Effective Global Brand Leadership. In this
discussion, Antonio Lucio illustrates how Pepsi exhibits
three of these global brand leadership principles.

Ensure Absolute Clarity for Stakeholders

EffectiveBrands has found that it is not the breadth of
responsibilities, but the clarity of responsibilities that drives
effectiveness. Pepsi demonstrates this fundamental
understanding by clearly defining who sets the global
agenda, who makes the final decisions on the priorities,
and who casts the final vote if any discrepancies exist. In
dealing with bottlers, there is also a clear mutually agreed
upon operating framework where the central team is
responsible for the brands and the bottlers are responsible
for the operations. If a conflict arises, then each party has
the final decision in the respective areas for which they are
responsible.

Adopt a Servant Leadership Mindset

Pepsi recognizes that global marketing takes place in the
local market place. Antonio Lucio makes a specific point of
avoiding the ‘ivory tower’ way of working and leads with
the mindset of ‘Leadership by Influencing.’ He understands
that his role is to make the local marketers and bottlers
more effective and successful. As a result, his goal is to
meet their needs and to always add value to their agenda.
This is achieved through showcasing outstanding local
work as best practices, in addition to leveraging centers of
excellence to deliver global goals and drive local agendas.

Focus the Global Brand Team

Pepsi understands that the global marketing team must
focus only on initiatives that the local markets would not
otherwise be able to develop either due to lack of time or
resources. Many of these initiatives could also be
categorized as long-term and ‘very important, but not
urgent.’ To build credibility with their local operating
companies, Pepsi operates in a bottom-up process
involving local marketers in every step of the development
process. If the initiatives developed by the central team
can be provided at the same level of quality by a local or
regional market, then it is scrapped. The global team
measures their success based on the business results of
their local markets and on the usage of programs and tools
that were developed centrally.

About EffectiveBrands

EffectiveBrands focuses exclusively on servicing the unique
opportunities and challenges faced by global brand
marketers. We provide effective solutions for global
innovation, organization, and capability development.
Working with a global network of expert partner consultants,
we have achieved outstanding results and client satisfaction
on key projects for global industry leaders.

http://www.effectivebrands.com

Danone - Serving Up Servant Leadership

2008-04-20T13:44:00.000-04:00

http://www.effectivebrands.com

In the last year, over 60 global brand executives have
participated in an exciting learning project on Leading
Global Brands. All participants are the CEO, Chief
Marketing Officer, or Global Brand Director of a global
brand. They all share a desire to be thought leaders in
developing ideas and best practices for leading the
global brands of the future.

Danone
Serving Up Servant Leadership

This Bulletin features a discussion between EffectiveBrands
(EB) and Olivier Faujour (OF) of Danone. It talks about
Faujour's experiences as General Manager of the Dairy
Division for kids' products. Kids' products are sold under
different local brand names (Danonino, Danonetje,
Danimals, Petit Danone) in more than 30 countries and
account for $1 billion turnover.

In 2005 Olivier Faujour was promoted to General Manager of
the Dairy Division for China. He had been in his role as
General Manager of the Dairy Division for kids' products
since 2003. Before that, he served in several marketing
roles at Procter & Gamble, in Europe as well as Latin
America from 1989-2002, working on brands such as
Pampers and Ariel. His last position at P&G was that of
Marketing Director Brazil, where he was responsible for
fabric and home care.

EB: Do you have an operating framework in place that
clearly delineates responsibility and accountability?

Faujour: At Danone responsibility and accountability are clearly
defined. Local managers are responsible for growing the
profit & sales of their brand by putting the right strategy
on paper and executing the brand mix - from product development
through local R&Ddown to advertising, merchandising, and pricing.

The primary role of central teams, such as the one I lead, is
to give local markets the tools to do this faster and better.
Their secondary role is to lead and deploy international
innovation projects. The last is to provide dedicated help to
countries not able to deliver their growth budget. I believe
this operating framework is a key contributor to the strong
results that Danone's Dairy Division currently enjoys
worldwide.

There is usually great open-mindedness on the part of local
organisations because they know that the central teams are
there to add value to their work and not to steal their job.
The ownership given to the local organisations creates a
strong entrepreneurial spirit with highly motivated and
enthusiastic people. It also helps us attract top local talent.

EB: Can you give an example of when this local
ownership and entrepreneurial spirit translated into a
global success?

Faujour: Although I am ultimately responsible for P&L, the
local organizations will always be in the driver's seat. It
works both ways: whenever I have a success from another
country that they could benefit from, they're open to hearing
about it and when they want to know what's happening in
other countries, they are always free to give me a call and
get the answer. Overall, there's a high level of trust and
transparency in day-to-day communication. Due to this, we
have been able to roll out a successful consumer promotion
related to the kids' products, which was invented in Mexico,
in more than 20 countries this year and have experienced
double-digit growth.

EB: Is the same true across all of the dairy brands or
is it specific to the kids' brand?

Faujour: The kids' brand is probably the most local of
Danone's four largest brands, the other three being Actimel,
Activia, and Vitalinea. Actimel for example has a much more
global marketing mix. After achieving success in Belgium, it
was launched almost at the same time across several
countries with a unique positioning whilst leveraging the
best practices from Belgium.

However, the key role of my counterparts who manage
brands centrally with a more global mix is much the same as
what I described for the kids' brand. Their role is to identify
and roll out new best practices to accelerate business growth.

EB: In the scenario where you were not happy with
the chosen local direction, what mechanisms do you
have in place to put a check on a country's plans?

Faujour: You sometimes need to temper the enthusiasm of
local countries that want to embark on a project that has not
delivered against expectations in other parts of the world.
You need to act fast and be forceful to ensure that they do
not waste time and money re-testing an idea that has low
odds of success.

If a country wants to implement an idea that did not meet
expectations elsewhere, it is our role centrally to raise the
flag, to convince them to at least run local research or
pursue other ideas with stronger international pedigree.
Discussions happen cross-functionally through informal
meetings where the general managers and the Dairy
Division president sometimes participate. The President of
the division acts as the ultimate arbiter/referee, if
necessary. Most debates "local vs. global" are healthy. They
help question the status quo and can lead to new ways of
doing business.

EB: How do you deal with issues where it is a matter
of interpretation - globally, it makes sense but locally,
it has an impact on how the market is seen to perform
in that particular year?

Faujour: It is sometimes an art to find the right balance
between global and local needs. Decisions need to be made
with the maximum amount of pragmatism, always keeping
the consumer in mind. In my experience, when a central
team is pushing hard for a "global" idea without getting a
positive response from many countries, it suggests that this
idea may not be as good as the central team thinks.

There is always some resistance to new ideas, particularly
when they come from elsewhere. For instance, when we
decided to invest in a common brand character "Dino" to
maximize appeal to kids, there was resistance from
countries that had other plans such as pure licensing. The
resistance was mainly due to the fact that these countries
were not seeing the value of the "Dino" character. We
launched it first in certain countries and when we
experienced success, others quickly followed. Today, the
"Dino" character is one of the hottest among kids in
countries like Spain and Russia and we are now able to
export similar character promotions across the globe at
minimal cost.

EB: What would be your key learnings or observations
with respect to Roles & Responsibilities coming
personally from a centralized to a decentralized
organisation?

Faujour: First, the voice of the consumer must always be
heard and be at the centre of decisions. Danone values that
the consumer is the boss.

Don't try to be everywhere. Try to identify the few countries
that will help you qualify potential big ideas for the world.

Be humble and try to recognize that your intuition can be
wrong because in the end, the local organization is supposed
to know their market best.

Travel enough and spend a lot of time in the markets. Don't
stay in your ivory tower.

Lastly, show enthusiasm and empathy to the countries. Try
to understand their overall business context, not just in the
frame of the brand for which you are accountable.

EB: You mentioned earlier that part of the role of the
central team is to provide local marketers with tools
to perform faster and better. What mechanisms have
you put in place to achieve this?

Faujour: We have ongoing tools (available to all
marketers worldwide) such as the Intranet, e-mails, and
newsletters that help us to share brand-specific best
practices. We also have conventions twice a year
where we bring the marketing directors from around the
world together and the central team presents their vision
and latest best practices. The Conventions are more topdown
as the objective is to share proven ideas to a large
audience all at once. We also have workshops on selected
subjects (e.g. evaluating pricing strategy) which bring group
managers, who are a level below marketing directors, or the
brand managers together for a day or two. There are eight
to ten of these workshops each year and they can be run
regionally or globally. These meetings are working sessions
and are therefore very interactive.

EB: Is there anything that pulls together the Danone
Way of managing a brand?

Faujour: General marketing training is run by the central/
local HR organizations. The Danone Marketing University is a
training program for new hires which consists of 3 waves of
training covering the basics of positioning, market research,
financial marketing in which key experts participate to share
their experience first-hand of working on particular brands.
During this 'University', every new hire gets a godfather (a
senior-level mentor) whose role is to give tips and advice on
business and career management.

We also have something called the Danone Forum, which is
an internal training program delivered by the local marketing
directors once every quarter. The aim is to give local
marketers a little bit of theory on different elements of
marketing such as advertising and packaging using
benchmarks and case studies. Here, as in other areas, the
idea is to leverage the materials developed in other
countries and adapt it to the local situation.

EB: Are there any more informal methods of sharing
information and best practices?

Faujour: At Danone, having a strong network is very
important. We are publicly encouraged by top management
to get together, create a network, and talk to colleagues in
other countries on issues we face, rather than relying solely
on formal meetings. The corporate "Who is Who" Intranet is
also a networking facilitator.

EB: How do you ensure that you also have global
leverage in terms of your external partners, e.g. ad
agency?

Faujour: We use a worldwide agency for advertising, Young
& Rubicam. We ran an initiative recently called the 'Copy
Challenge' to create advertising copy for the kids brand. We
provided some broad guidelines on what the brief should be
(the advertising platform). Each of the fifteen participating
countries then briefed their local agencies using a local brief.
The local agency creatives presented their ads to us in New
York and we selected the top 3 ads, which we then partially
financed in terms of production costs, etc. The countries
whose ads were not selected went ahead and financed their
own ads.

The outcome was very positive; it resulted in many good
ideas, some of which are now proving to be successful. It
was also a good way to make the various local agencies
work harder for us.

EB: As you mentioned earlier, the secondary role of
your team is to lead and deploy international
innovation projects. Where do you find inspiration for
new innovations?

Faujour: I try to keep an eye on what's happening in
the different markets. There are some specialised
websites in nutrition which present all the latest
innovations, interviews with food professionals, etc. and
that exposure can give you a sense of what could be a big
hit two to three years from now. Attending congresses with
key food professionals and other experts (sociologists,
paediatricians) can also give great insights. Lastly, regular
store checks in the 35 countries where my brand is sold can
also be a great source of inspiration.

EB: What approach do you employ with respect to
these international innovation projects?

Faujour: We work on longer-term breakthrough product
concepts that will hit the markets two to three years from
now so the work we're doing is quite upstream, e.g.
definition of what technology we would need to buy to
deliver the product benefits. Once we have identified the
market potential, how big the idea could be, we select two
or three countries that could roll out the innovation and then
they champion running all the market research,
development etc. with our guidance. Countries usually don't
have the time to do the first stage of the investigation.
However, it is critical to involve them early enough so they
feel ownership.

EB: Are there other mechanisms through which
innovations are leveraged across countries?

Faujour: Every local country has an R&D department that
reports via the European R&D to central R&D.

In the case of a concept being developed by a local team,
they brief local R&D to first screen for similarity of concept.
R&D has resources all over the world and can come back to
the local team and ask them to get in touch with another
country that is already working on a similar concept. If no
similarity is found, then local R&D starts assessing the
feasibility and business potential. If approved and additional
resources are required, another country will be asked to join
either directly or via the centre.

Principles of Effective Global Brand Leadership

In this discussion, Olivier Faujour emphasizes the
importance of several principles of leading global brands.

Servant Leadership

Servant Leadership is the idea of helping employees reach
their full potential by empowering them and addressing
their needs. It is all about avoiding the ivory tower
perception of people in the central team. It is about
understanding that, as a central resource, you are there
for the one and only reason which is to make the local
operating companies more effective and successful. Global
marketing takes place in the local market place. A simple
truth forgotten by many, but driving the Danone way of
global marketing.

Facilitate Global Leverage

The role of the central group is primarily to identify and
accelerate roll-out of best practices across local markets.
Global conventions, together with ongoing tools like
Intranet, e-mails, and newsletters, help to effectively
disseminate best practices across the global marketing
community. Investing in a common brand character and
exporting it across the world at minimal cost is one way in
which Danone exploits the benefits of scale. Using a
worldwide advertising agency is a common means for
globally leveraging resources. Having the local creatives of
the global agency compete against one another ensures a
higher quality end product.

Global Innovation

The area of innovation is often the only one without vested
interests. The central group focuses its resources working
on breakthrough international concepts, but ensures local
ownership and relevancy by involving countries early on in
the process. What is also recognized is that good ideas can
come from everywhere and everyone: innovation takes
place on a local as well as a global level. The way R&D is
organized ensures that there is not superfluous repetition
of efforts.

About EffectiveBrands
EffectiveBrands focuses exclusively on servicing the unique
opportunities and challenges faced by global brand
marketers. We provide effective solutions for global brand
positioning, innovation, organization, and marketing
education.

Working with a global network of expert partner consultants,
we have achieved outstanding results and client satisfaction
on key projects for global industry leaders.

http://www.effectivebrands.com

InterContinental Hotels - Global Branding Suite Success

2008-04-15T14:18:00.000-04:00

Leading Global Brands Bulletin

http://www.effectivebrands.com

In the last year, over 60 global brand executives have
participated in an exciting learning project on Leading
Global Brands. All participants are the CEO, Chief
Marketing Officer, or Global Brand Director of a global
brand. They all share a desire to be thought leaders in
developing ideas and best practices for leading the
global brands of the future.

InterContinental Hotels - Global Branding Suite Success

This Bulletin features a discussion between EffectiveBrands
(EB) and Peter Gowers of InterContinental Hotels Group. It
talks about the challenges of global brand development,
global activation in a franchise service model, and inspiring
brand-building behaviours throughout an organization.\

Peter Gowers joined the strategic planning group of Bass
PLC, a hotels, brewing, bars and restaurants conglomerate in
1999. When Bass (then known as Six Continents) announced
the demerger of its remaining businesses in 2002, Peter
joined the newly independent hotels company,
InterContinental Hotels Group, as Executive Vice President
(EVP) of Strategy. In 2003, Peter was appointed EVP Global
Brand Services with responsibility for group strategy,
worldwide marketing and distribution, loyalty programs and
revenue management.

EB: InterContinental Hotels Group is comprised of seven
major hotel chains across the world. What challenges do you
face in managing those chains? Are there any industryspecific
challenges that are particularly difficult to face?

Gowers: I think the biggest challenge for us is global
brand development. We really wrestled with the challenge of
deciding which brands to run globally and which ones are
national. As part of our organizational review, we
decided that we would run our InterContinental brand as a
global brand, meaning one team based in one location with
contacts with stakeholders in three regions. They run it as
one consistent product across the world.

Holiday Inn (the world’s most stayed-at brand) is run on a
regional basis. For Holiday Inn we have dedicated teams in
each of our big markets. Each Holiday Inn looks and feels a
bit different depending on where you are in the world.

We operate in a franchise service model. We not only have
the challenge of what you would like the brand to look like in
different regions, but we also have the added challenge of
actually making it happen. We don’t control the consumer
experience to the last degree. Most branded hotels in the
world are franchised. The owner of the property is not the
same as the brand owner.

The approach to this challenge has always been to anchor it
back to what the consumer wants. What do we think matters
to our consumers? We found that 70% of the people who are
staying in a hotel tonight are staying in the country they live
in. Knowing that, we are much better off optimizing our
brand for local market conditions than trying to impose a
‘one size fits all’ approach across the world.

EB: How do you run the InterContinental brand? How the
team is set up and structured in terms of roles and
responsibilities?

Gowers: We have a Senior VP of the InterContinental brand
and she is based in our corporate office in the UK with me.
She has all the classic brand management responsibilities:
developing the brand essence, the core brand positioning,
the essential attributes for the brand, the hotel standards,
and assuring a consistent, creative look and feel. She also
does the media buying and selection for most markets of the
world.

In the biggest region in which we operate (U.S.), we have
folks on the ground that deal with modifying the global
campaign locally and also serve as the public face of the
brand if we try to buy or sell a new hotel. Those people
report in a matrix structure into the global brand manager
and also to a local or regional marketing director.

We have a brand team here in the centre that is responsible
for A&P and new product development. In total, the team is
about six people.

EB: With regard to developing the InterContinental brand
positioning based on a universal target consumer insight,
how did you tackle this?

Gowers: First of all, on the consumer side, the
InterContinental brand targets the consumer who is
internationally-minded, psychographically as well as
demographically (who see themselves as or actually are
people who travel all over the world). We have a lot of
consumers in America who don’t travel the world at all, but
like to feel they understand its differences. The brand is
aimed at that kind of consumer.

When we revisited our brand positioning, we commissioned
quantitative research in the US market, Europe and several
markets in Asia to get an understanding of our broad
consumer base for segmentation purposes. From this
research, we distilled the critical and fundamental attributes
to deliver the guest experience that really needed to be
consistent across all three regions. For the InterContinental
brand, these attributes included: having a signature
restaurant, providing 24-hour a day services and offering real
local insight to help you get the most from your stay.

Then we looked at attributes that were very specific to the
local market. For example, a consumer who visits one of the
less developed markets in Asia Pacific expects to find many
staff to deal with their needs, they know that the labour
costs there support this level of service. They don’t
necessarily expect quite the same thing when they go to
Geneva.

So we have a basic series of things that all our hotels do
regardless of where they are in the world and we try to select
a minimum number. What we are looking to have is a
guaranteed execution across the world. In a service business
the fewer things you guarantee, the more likely you are to
be able to do them. Brands that can guarantee very
complicated propositions around the world tend only to be
higher-priced brands like the InterContinental.

We might have 25% of standards that are absolutely cast in
stone; the remainder (which are largely to do with physical
property and staffing levels) will be much more flexible by
region. We allow our hotel operators in each region to make
those decisions in accordance with local competition.

EB: How does your vision and culture relate to your brand
positioning?

Gowers: We are trying to link the corporate strategy of the
business that we communicate to the stock market as explicitly
as possible with our day-today operations. This company is
all about signing up newcontracts and franchises
and the key driver of doing that is brand strength.
Gradually over time, we built more and more
of a brand culture in our company where it used to be
dominated by a hotel operations culture. These are two very
different things. We are wrestling with the challenge: what
takes the values of your brand right through the organization
when your organization is full of people who are not used to
seeing brands in the hotel industry.

EB: How do you ensure that this brand positioning is
executed in terms of the values that people represent to the
end consumer?

Gowers: There are two big things that we have learned that
have influenced the way we do things:

You can’t come up with a positioning of your brand that is
inconsistent with the sort of people you’ve got working for
you, unless you are prepared to change them all and that is
pretty difficult. We very much start from the perspective that
if you want this value to come alive on the property, you
have to have the right kind of people in the first place. So, I
can’t tweak my brand values unless I am committed to
changing my staff.

The second thing we learned is that every aspect of your
marketing and service delivery has to be tied back to the
brand essence & personality. I know this is Marketing 101,
but in this industry it’s something quite difficult to do. Our
brand personality, ‘the hotel that understands you’, wouldn’t
mean anything if we couldn’t get those little executions right.
We tend to try and do fewer things, but do them really well.
A good example of that would be our Holiday Inn Express
brand. We selected one or two things that we can stand for
and completely execute. A new breakfast concept, an
initiative of the brand director, was successfully rolled out
over 1,000 hotels in about 3 months. This concept was
thoroughly researched and works on one of the key
attributes of Holiday Inn Express.

EB: Once you’ve got that employee base you can’t change it
completely, but you can influence the new people that you
take on board. How do the brand values influence your
recruitment process?

Gowers: At a property level it is fairly obvious that
recruiting on brand type does. You tend to screen against a
particular pattern of brand attributes. For example, at
Holiday Inn we tend to recruit people who are extrovert and
have a friendly demeanour and all the other things that go
with our brand. At InterContinental we try to recruit people
that know how to deliver discreet service. We even tried to
extend this back up the line: if you look at the 5 or 6 people
that head up the brand in the different markets, you will find
that they tend to embody their brand personality. So the
person who runs Staybridge Suites is very much a straightforward,
unpretentious kind of guy and the lady who runs
InterContinental is someone who obviously knows her way
around the luxury end of the travel market.

We have got people whose personalities reflect the brand
that they run and that turns out to be very effective. When
you are trying to sell a new hotel (or get a travel agent to
decide to book people into your property) there is nothing
that makes them feel more comfortable about it than seeing
the personality of the brand come through in the people who
are going to deliver it.

EB: Could you elaborate on the brand values that are
important for InterContinental in recruitment?

Gowers: InterContinental tends to look for people who are
respectful but not sycophantic, have a degree of appreciation
for the world, rather than just their local market.
InterContinental, for example, has a far higher proportion of
people who have worked in multiple countries, right down to
housekeepers and front desk staff. We do tend to recruit
people who know the foibles of different nationalities and that
is much more important than at a Holiday Inn Express. A
good InterContinental General Manager will probably have
worked in at least three countries and three continents. For
most of our people this is quite true, they have worked in
multiple geographic regions of the world. Ultimately, the
brand personality is very much to be both worldly and
international and relatively exclusive and sophisticated.

EB: Does this carry through in the way you evaluate people
in their performance reviews?

Gowers: We’re getting there. On the spectrum of things you
can do to guarantee the guest’s experience, you first start
with a clear brand identity. You translate that into who you
hire and you then monitor that into how they deliver. I would
say we have done a good job on the first two. We are
starting to track individual performance with reference to
individual brands. That has been the main challenge, and I
guess it’s also the case in other industries. Economies of
scale in the systems facilitate tracking them all in the same
way (standard performance assessment across brands). This
can leave little room for brand individuality. In the industry
everyone is learning that you can’t create a true brand
personality unless you do measure the brand performance
differently by brand. We are just starting to roll this out.

Principles of Effective Global Brand Leadership

In this discussion, Peter Gowers has emphasized the
importance of several principles of leading global brands.

Focus the Global Brand Team

In a service industry, having a focused brand positioning is
a key success factor. Knowing this, InterContinental
selected set of core brand attributes which then allows the
Global Brand Team to focus on, and flawlessly execute,
each of those attributes. The brand platform clearly
identifies which attributes should be consistent globally and
which can be adapted for the local market, giving clarity
between the Global Brand Team and local marketers.

Inspire Personal Commitment to the Brand

A challenge several global brand leaders face is inspiring
the personal commitment of their employees to their
brand. InterContinental recognizes this challenge and
reflects it not only in their positioning, but also in their
hiring practices. The brand leaders in each of their markets
personify the brand. In leading by example, they inspire
others in the organization to become more committed to
the brand. When hiring all new employees, InterContinental
looks for people who embody the brand personality,
knowing that they will better be able to deliver on the
brand promise.

Promote True Brand Behaviour

Promoting the right behaviour is a key component to the
long-term success of a brand. An essential part of
promoting consistent brand behaviour is measurement.
InterContinental acknowledges the importance of
monitoring how employees deliver on the brand promise.
While they are still in the process of rolling out a
performance measurement system tailored to their
individual brands, InterContinental understands the
importance of promoting and reinforcing behaviour that is
consistent with the brand identity.

http://www.effectivebrands.com

Dow Corning – Silicone-Slick Branding

2008-04-10T14:32:00.000-04:00

http://www.effectivebrands.com

This Bulletin features a discussion between EffectiveBrands (EB) and Scott Fuson of Dow Corning. It talks about Fuson’s experiences harmonizing Dow Corning under one master brand, educating and inspiring the marketing community at Dow Corning about the new strategy and architecture, and using all of the resources available to him to make the changes happen.

Scott Fuson is the Global Executive Director for Marketing and Sales & Customer Service for Dow Corning Corporation. Mr. Fuson joined Dow Corning in 1982 as a Field Sales representative in New Jersey for High Technology Industries. In 1995, Mr. Fuson relocated to Europe, where he served as Sophia site manager and as European Industry Director for Healthcare Industries in France. He was named Global Marketing Manager for the Strategic Intelligence and New Business Market Development SPU in 1999 and relocated back to the U.S.

Formulating a Clear Brand Strategy and Architecture

EB: One challenge that companies and marketers typically face is marrying the fact that they have both specialized brands and a corporate brand. How did you handle this, both strategically and tactically?

SF: We made the decision to target the low end of the market by developing a new web-enabled business model called Xiameter^®, which offers low prices for large volumes of commonly used silicone products. We decided on this strategy because the Dow Corning brand is not a “price brand” and we don’t want to make it a price brand. To that effect, a new business model had to be developed.

In the past, we let our brand evolve and what ended up with was a house brand with the culture of the company embedded in it. Positioning our brand was somewhat new territory for us. At the same time we had a proliferation of new brands that really had no rhyme or reason. We realized then that it was time for a corporate branding strategy.

Three years ago, we looked at the house brand, Dow Corning, and decided what the attributes and brand drivers were. We then developed a brand architecture, which was done with the top 25 executives of the company. Ultimately, we developed a master brand endorser strategy, then went back to the portfolio and mapped all our products accordingly.

EB: Did you ever come across brands you owned that were very successful in a specific industry yet somehow their values seemed at odds with the Dow Corning brand? How did you go about resolving this?

SF: Yes, we found a number of brands in that situation. We addressed this by forming a Brand Council and creating a new position of Global Brand Manager. The Corporate Communications Officer, the Global Brand Manager, several leaders from across our industries and I were brought together to form the Council.

In our discussions, we made sure we educated the marketing and industry groups worldwide on the new marketing policy and on how to do branding globally. Part of this new policy stated that before you created a new brand you had to come to the Brand Council.

EB: How did you go about educating the marketing and industry groups?

SF: We educated them primarily through workshops. The workshops we conducted were about marketing education – what are the rules and general principles of branding, such as ‘The fewer brands, the better’, then we got into specifics like ‘What should the brand architecture be?’ You have to have agreement and support at the beginning of the process. We created a common language through education and everyone came back with recommendations.

EB: Was there ever a struggle between you and the other business leaders?

SF: Not necessarily, since the business managers and top 25 people agreed to the brand strategy and architecture. Everyone had a natural interest in participating. The attitude was basically, ‘Let's get together and clean this up.’

Additionally, every year the company develops 3-5 corporate priorities, based on the company’s strategy as a whole. These are things that drive everything forward. For the last three years, one of these priorities has been to energize the Dow Corning brand. When we hit our targets, we retire them or add new targets. Basically, energizing the brand was made a top priority.

Bringing the Strategy to Life

EB: How many brands did you have prior to the development of your corporate branding strategy? What impact have you seen as a result of the new strategy?

SF: Hundreds, although Dow Corning had been reducing the number of brands we own. Licensing income has increased dramatically as we have reduced the number of brands we use. Focusing on the central Dow Corning brand has brought in licensing fees from many areas that were not previously Dow Corning branded.

EB: Did the CEO support you in your efforts?

SF: She whole heartedly bought into it because when you energize the brand, you energize the people. So naturally, she saw the link and value that would be added from the work.

EB: Now you have to tell the business leaders that the brands need to change or are conflicting with the master brand. Can you talk about this?

SF: We essentially said, “Here's the list of the brands you own and we're going to migrate them to the house brand. If you have an objection, you have to come to the Brand Council." For the most part, there was very little conflict. There were some tough decisions. We continually asked for analysis to support the objections people raised, yet few had the data to back up their positions. Because the culture of the company places an emphasis on using "fact supported decision making," due to Six Sigma, the Brand Council knew what the sales were for each brand and what the budget was, so it was a very transparent, natural process.

We went through a process and set of criteria outlining questions such as: ‘How much are you investing?’, ‘What's the value of the profit today?’, and ‘What do you project it to be in the future?’ This also involved measuring the performance of the brand. We looked at the brands, ran through the hierarchy and had the data to respond to any challenges. The Brand Council was surprised at how much credibility and authority we had. This was all attributable to the research we had conducted.

EB: You've talked about educating and aligning the whole marketing group – how large is your team?

SF: 150 marketing professionals worldwide.

Brand communication in general, including the global communications leadership team, consists of about top 500 managers across the globe. I meet with them every other month, sometimes by voice conference. We have a regular call for Asia, one for Europe, and one for the Americas. That's how we keep top management informed. The meetings are run by the CEO. Slides are sent out a few days in advance and the meetings typically last 90 minutes. She introduces the meeting and talks about issues she thinks are important, then the CFO speaks about the company’s performance, and then we transition into the conference/meeting with the marketing professionals. That's how we get them engaged. The second half of the meeting is open for questions.

Taking the Temperature of the Brand

EB: How do you ensure that the information from the meetings reaches everyone in the organization and that they completely understand what is being conveyed?

The expectation is that all that communication will be cascaded down into each business unit by those attending the meeting. They're expected to organize this themselves, but the central group surveys people to see how effective the communication was. The survey is in the form of a web-based, Intranet questionnaire. Employees are asked if they would like to participate in the survey and can then go to the Intranet to complete it. In the survey, we measure their awareness of topics in several areas, for example:

Energizing the brand as a corporate priority
Brand drivers
Brand attributes
Salience and understanding of the information discussed

The survey is anonymous. I’d like to have more information on the types of people who score the highest and lowest, so I can see who best understands the information, executives or line people. We haven’t moved in this direction, though, because our results indicate that we’re already getting a pretty good understanding across the board.

The second communication tactic we use is the Intranet, “DC Connection.” On the Intranet, we post articles that are relevant to the execution of our strategy and priorities. One section is called "News from the Field," where anyone from the field can post a major accomplishment or their experience on a successful and significant project. Globally, we get about two of these postings each day. The site basically facilitates the sharing of best-practices, practical applications, and shows people in the back office that the strategy is actually happening and that it’s working. By providing a forum to highlight successes, we are essentially creating heroes, which we believe is a very important thing.

EB: How do you ensure that your ‘Brand Heroes’ are recognized?

SF: We have a Marketing Excellence Council that consists of lead marketing people from each of our industries. We have recognition events where top executives select the best marketing professionals from the previous year, based on certain criteria, which include elements of the company’s strategy. Marketers throughout the company know about this and are motivated to win these awards. From a career perspective, winning an award or participating in the process is essential to reach certain levels within the corporation.

Principles of Effective Global Brand Leadership

In this discussion, Scott Fuson emphasizes the importance of several principles of leading global brands.

Ensure Absolute Clarity for Stakeholders

Formulating a brand strategy and architecture that was clearly understood by everyone in the organization was the first step Fuson took in effectively managing the Dow Corning brand. Making “Energizing the Brand” a top corporate priority illustrated branding’s importance to the future success of the company. The creation of the Brand Council provided a means to mutually agree upon the core attributes of the brand. Through the Brand Council, Fuson was able to clearly convey what was negotiable about the brand and what could not be changed.

Inspire Commitment to the Brand

The support from the CEO, coupled with marketing education, drove the appreciation for branding within the organization. CEO-led meetings were used to disseminate information as well as engage and inspire employees. The employment of the “News from the Field” section on DC Connection, Dow Corning’s Intranet website, was essential in creating role models from within and fostering commitment to the brand.

Promote True Brand Behavior

The key to long-term differentiated success is rewarding those who consistently exhibit brand-building behavior. Fuson promotes brand behavior by highlighting successes through DC Connection as well as through major recognition events. Incorporating brand-building behavior into employees’ career paths makes it clear that commitment to branding is essential to success at Dow Corning.

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Leading Heineken to Global Growth

2008-04-05T14:34:00.000-04:00

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This bulletin features a discussion with Heineken’s Chairman, Thony Ruys. What role can the Chairman play in ensuring global consistency and driving the priorities of the brand? Is there a global Heineken consumer? And what principles of leading global brands has Ruys found to be effective?

Thony Ruys (b. 1947) After 18 years with Unilever in the Netherlands, Colombia and Italy, he became the marketing member of the Executive Board at Heineken NV. Since April 2002, Ruys has been Heineken’s Chairman of the Executive Board.

Tradition and Change

EB: There’s often a very strong personality behind a global brand. Is that the case with Heineken?

Ruys: Of course -- Freddy Heineken. He was aware of everything, concerning himself with the smallest details. For example, he once sent back an enormous batch of café parasols because he felt that their color lit ladies in an unflattering way. That’s why you’ll never find anything other than green-and-white Heineken parasols. Heineken is a very different company from, for example, Unilever. You feel the legacy and the vision of Freddy Heineken everywhere.

Understanding the Global Young Adult Consumer

EB: What’s your greatest Global Branding challenge?

Ruys: Heineken has always appealed to the young adult consumer. One of my spearhead objectives is that Heineken retains that appeal. Over the last few years, beer has been under pressure in clubs and at parties because of the introduction of mixed drinks, which are regarded as “hipper”. We must ensure that our beer remains relevant.

EB: Our conversations with corporations such as Nokia, Virgin, and Starbucks have shown us that every global brand director wrestles with the question of how to manage brand development at the central level without neglecting local customer insights. How do you develop a brand worldwide without making too many compromises?

Ruys: Freddy Heineken always asked, “And what would the consumer think about it?” That made an impression on me.

Right after my appointment, I went around the world to learn more about the young adult consumer. I wanted everyone at the company to grasp just how important it was that we understand this market. In many countries, I sat in on local research about young adults. I also often spoke personally with the local young adults, usually without them knowing my job title, so that I’d get to hear the naked truth. After a number of months, the ball started rolling, and more and more initiatives emerged. Project Beacon, as we call it internally, has already brought our marketers closer to the consumers in their twenties.

EB: So Project Beacon was about getting all marketers across the globe more engaged with their local youth market?

Ruys: Yes. Some assume that a uniform urban culture has come into being among young adults in big cities. However, what we learned from Project Beacon was that these young adults are not a homogenous international target group. They’re interested in international brands, but remain strongly attached to their personal cultures and origins.

The challenge for an international brand is to inspire but at the same time remain personally relevant. A good example is the Thirst Platform that Heineken launched in the summer of 2002. This is an international dance-concept in which young, local up-and-coming DJs get the chance to play with famous international DJs. This world of entertainment fits very well into the Heineken brand, and it also addresses the needs of each local market.

EB: Are you seeing a shift in dynamics between global brands and consumers?

Modern consumers increasingly have problems with the intrusiveness and uniformity of brands. As a result, a new wave of branding has come into being in which the consumer gives meaning and content to the brand. In other words, it’s now the consumer who’s choosing the brand, as opposed to our previous situation in which the brand chose the consumer.

For example, there are rebellious brands such as Gsus and Quicksilver that are latched onto by young people. There are also a few global brands that are very successful, such as Nike and Sony, in part because they’ve brought out special editions for select young consumers.

From Project Beacon we learned that we need to continually reinvent Heineken in order to be successful with our target groups. As a result, we’ve brought out a considerable number of new products and communication concepts. One notable example is the Alu bottle, which we‘re now rolling out internationally.

Heineken introduced the ALU bottle last year in France. This year the bottle has been rolled out internationally.

Global vs. Local Brand Leadership

EB: An issue that arises time and again is how to manage global brands, and what responsibilities should be placed at central versus local levels. At the beginning of this year, the papers were full of stories about marketing reorganizations within Heineken. It seemed as though you were centralizing all marketing power.

Ruys: Yes and no; we drew a very clear line.

Our two global brands, Heineken and Amstel, are now almost entirely steered centrally from the Netherlands. Many specific guidelines have been developed that determine the face of these two brands worldwide.

At the same time, we’ve strengthened the importance of and the resources for our local brands. Don’t forget that beer is still largely a local business. Our local brands are often the market leaders in their respective countries.

EB: Many global organizations have come to standardize back-end production while preserving “end of line” flexibility to allow for local diversity. What’s Heineken’s approach?

Ruys: We believe strongly in that, too. We harmonize the bottle for a number of countries, creating substantial savings. At the same time, we make sure the local consumer can identify with the label and contents.

EB: Global brand directors put a lot of time and effort into making all team members understand precisely what they can contribute to the success of the brand. How does Heineken communicate this to, say, a brand manager in China?

Ruys: Our global team is increasingly focusing on communicating with and supporting our local marketers. I indicated earlier that for our two global brands, a number of important aspects are set— positioning, name and logo. In addition, we try to pass on best practices from other countries so that the wheel doesn’t need to be reinvented; and central media planners play an important advisory role for local colleagues.

EB: Companies with strong brands take organizational activation very seriously. For example, Dove’s global brand director recently conducted a brand stewardship tour in five regions with more than 2,000 people invited. Nokia’s global brand director sends every new marketer a ”brand book” as a welcoming gift.

Ruys: I too believe in the head office communicating fundamental brand values. However, it’s also important to remember and acknowledge local differences. The key is to find the right balance between central guidelines that the entire organization “lives by” and the content of the brand at a local level. It’s only when you understand and properly manage the relationship between the global brand and the local consumer that you have a strong global brand.

EB: American corporations often find it difficult to find the right people for international marketing positions. A headhunter recently told me that she’d recommended an American Hispanic for a regional brand management post in Asia because she felt he’d have a stronger conception of and sympathy for cultural differences. How international is Heineken’s global brand team?

Ruys: Very much so! Given Heineken’s history, you’ll still see many Dutch people occupying important positions throughout the company. However, we have marketers from all countries working on Heineken and Amstel. This diversity is crucial; otherwise, we’d be dealing with these beers as export products. Heineken and Amstel are genuine global brands, and their management reflects that.

Principles of Effective Global Brand Leadership

In this discussion, Thony Ruys emphasizes the importance of several of the Principles of Leading Global Brands™.

Project Beacon, Thony Ruys’ initial push to get the whole company closer to local consumers gave a clear leadership signal to the company. Everyone at Heineken quickly understood where they should be looking for growth ideas and build on the brand heritage, as developed by Freddy Heineken. By visiting and personally speaking with consumers around the world, Ruys led by example and embodied the brand to local marketers.

Heineken’s “Thirst Platform” is a very effective approach to leveraging global scale. Instead of trying to push a fixed global promotion campaign across the globe, the central team truly added value for local marketers by providing a “platform” that is flexible enough to travel. The fact that local marketers were subsequently challenged to develop locally relevant translations of the program recognizes the importance of inspiring marketing excellence at a local level.

By recognizing that not all brands in the portfolio need to be managed in the same way, Ruys is leading Heineken from an export company to a truly global marketing organization. We feel he is striking the right balance between global harmonization and local relevancy and that this mix will drive Heineken to growth.

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MasterCard - Priceless

2008-04-01T14:49:00.000-04:00

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This bulletin features a discussion between EffectiveBrands (EB) and Lawrence Flanagan of MasterCard. It talks about Flanagan’s success in rejuvenating the MasterCard brand, his approach to building an effective global brand team and the lessons he has learned along the way. Flanagan is the Chief Marketing Officer and Executive Vice-President of Global Marketing at MasterCard. The company's “Priceless” advertising campaign currently is airing in more than 90 countries worldwide. Flanagan has also held brand leadership positions at L’Oreal and Procter and Gamble.

EB: Can you describe the evolution MasterCard went through to achieve its current global positioning?

Flanagan: Back in 1997, MasterCard didn’t stand for any one thing. It had run through five different advertising campaigns in ten years and was losing a lot of business. My job was to fix the brand. I started in the U.S. by developing an effective U.S. advertising campaign that differentiated the brand in the marketplace. We worked alongside McCann-Erikson to develop the highly successful “Priceless” campaign. The positioning created by “Priceless” allowed MasterCard to integrate all its other campaigns and marketing practices within the U.S. This started as an advertising strategy, became a marketing platform and went on to become our global brand platform.

At that time, every country used a different agency, a different campaign, and a different strategy. The success of “Priceless” as a platform in the U.S. helped us persuade other countries to adopt one single approach. Over time this became a consistent global positioning. Our “Priceless” campaign now appears in 96 countries and 45 languages and forms the framework we use for all brand communications.

Developing a Consistent Global Positioning

EB: Starting a positioning locally and then successfully expanding it globally is unusual. The more typical approach is to begin with a unique consumer insight that’s applicable globally and then build a global platform from there. Is it luck that MasterCard’s key insight is applicable in other countries?

Flanagan: The U.S. strategy was based on a lot of consumer research; and the insight we arrived at was that there had been a significant change since the 70’s, attitude of, "you are what you buy". Consumers now focus on lifestyle and quality, and on the concept of, “rewarding yourself for what you've earned”. Their core values are family, security, companionship and “making time for yourself”. It was unique for a credit card company to say to consumers, "It's not about what you buy; it's about how you take care of yourself."

We found that our U.S. insight held just as true for every other country. We also conduct research called, “What Matters” to help keep our finger on the pulse of what is going on in the world. The success in this situation came from taking the insight to a level where it cut across every culture and country, based on an extensive understanding of what really matters to people.

EB: How did you convince marketers in other countries to adopt the same advertising campaign and platform?

Flanagan: Three factors facilitated the global adoption of the “Priceless” platform. First of all, the great success in the U.S. grabbed everyone’s attention. Secondly, nobody believed any other alternative campaigns were any better. Most importantly, whenever local marketers saw the campaign, they really liked what they saw. We had the numbers to back up the strategy, but we didn’t even need to cite them; marketers were won over by the innate appeal of the “Priceless” platform.

EB: Did you use the “What Matters” research to adapt the campaign outside the U.S.?

Flanagan: Absolutely. We empower every local team by saying, “Here's the strategy and the framework that’s proven to be effective. Now focus on creating content relevant for your own area within that framework.” The ‘What Matters’ research generates insights that allow local marketers to create a campaign that they truly feel has local resonance, while at the same time maintaining the core brand positioning. We’ve changed the meaning of "NIH" (Not Invented Here) to "Now Improved Here".

Global vs. Local and Building Effective Teams

EB: How do you structure your marketing organisation to promote a balance between executing a global strategy and maintaining local relevance?

Flanagan: We have about 130 people in the marketing organisation. The global team works with regional presidents and other marketing people on a daily basis. They are responsible for creating global strategies, setting budgets, signing off on plans and disseminating best practices across countries. Local marketers have clearly defined roles and responsibilities, so they are always certain about which aspects of the brand are non-negotiable and what aspects they can tailor for local consumers. The whole group has shared values and investments and we work in close partnership with McCann-Erikson sharing both risks and rewards.

Innovation is a little different for us as we do not distribute our own product, the banks do and they tend to invest in their own innovation and products. We typically develop things centrally and then work with the countries to see where this should be applied, but on the true product innovation front, we often find that more ideas come from outside the U.S. The lack of standardised infrastructure elsewhere, creates more opportunities to innovate in areas like chip technology and card design.

EB: What do you do to make it easier for your international marketers to work together effectively?

Flanagan: I make sure that our people meet at least once a year to simply get to know each other. Our corporate culture is such that if you have a question you just pick up the phone and call the person. If you’ve already met the person, that’s much easier to do. I try to create introductions and familiarity to instil a quick-response mentality.

Lessons Learned

EB: What are some of the top lessons you’ve learned that you could transfer to other brands?

Flanagan: The most important lesson is, “Listen to the consumer.” This was one of the keys to MasterCard’s turnaround. When you really listen to and observe consumers, you can make decisions based on what the consumer really thinks and feels.

Beyond the infrastructure you work within and measuring your ROI, everything comes down to the people you work with. We have a relatively small marketing function. We are fortunate in that we have some really talented marketers in every country who really “get” brands, enjoy the challenges involved in growing them, and know how to work in a matrix organization effectively.

EB: Based on our experience and past interviews, we often hear that Global Marketers lack a community in which they can openly share ideas. To address this we are creating a ‘Leading Global Brands Council’, where project participants will be able to meet and share best practices and challenges. Do you share a similar sentiment about there being a lack of community? And if so, to whom do you turn for guidance?

Flanagan: For general advice, I turn to the CEO and COO, regional presidents and banking professionals. When it comes to global brand issues I often talk to McCann-Erickson. They have accumulated decades of incredible experience. These discussions help push my team’s strategy to the next level[A1] . However, I do feel that people in my specific profession lack a community and that there are very few people with whom I feel I can have an open exchange of ideas. This is one of the reasons why I am so enthusiastic about the Leading Global Brands project and future Council meetings.

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