It's time to revolutionize marketing communications, Hewlett-Packard CMO Mark Mendenhall told attendees at the annual Association of National Advertisers Conference last week. "The relationship companies have with consumers has been upended," he said. "It's no longer the 30-second commercial that defines companies, but a comprehensive digital strategy is required."
Arguing that digital strategies should be applied across the operational infrastructure of companies as well as in their marketing, Mendenhall pointed out that "digital media have been anchor-bolted onto agencies [and strategies]. The digital integration issue needs to be dealt with at the corporate and agency level across all functions within a company. The digital environment allows you to engage with consumers in a better way."
In response to this trend, traditional media will change and evolve, becoming more personal and more custom, Mendenhall suggested. "How we look at [media] planning and buying will change and will become more customized. We will see dramatic shifts and this poses a challenge to everyone here. It's important," Mendenhall added, "to be risk takers. To push the boundaries into uncomfortable areas. We have not seen [technology] adoption rates and behavioral changes like we are seeing now."
Inspiration and innovation were constant themes at the ANA event, which focused on how Masters of Marketing are dealing with the dramatic changes driven both by the economy and technological advances. "Balancing inspirational and operational marketing, and moving from spray and pray to precision marketing" are two key fundamental guidelines for the future, commented Coca-Cola CMO Joe Tripodi in a detailed overview of Coke's global marketing strategies. "It's important to keep the inspiration going to retain customers." Tripodi recommended that marketers "control your own destiny or someone else will… and innovate everything both at the core of the business and in emerging spaces." Claire Bennett, American Express CMO added that "marketers need to focus on inspiration beyond return-on-investment. Don't hunker down in a bunker. Take fewer risks but take them."
Mendenhall, who joined H-P from Disney Theme Parks last year, explained how "digital conversation has become a global phenomenon and is just getting started." In Brazil, for example, 76% of Internet users are on social networks. China has 42 million bloggers. In this new model, he pointed out, "individuals have the power to disrupt the masses." Marketers, he suggested, can use advertising dollars to build their own online forums and their own media networks through new syndication models and more nuanced, customized approaches. "These will not be defined by companies but by consumer ecosystems," he commented.
Joaquin Hidalgo, VP Global Marketing at Nike advised "consumers don't want more things; they want more experiences." The Nike model, he explained, is to "build a bridge between the digital and physical worlds… through innovation, inspiration and experiences." Nike, he added, is itself a media platform. Mark Addicks, SVP and CMO of General Mills, shared examples of how brands are using blogs and cause-related initiatives to build and expand brands and their relationships with consumers. In an audience poll, 28% of ANA attendees identified social media integration as their best opportunity for brand growth, the #1 ranked opportunity. Yet, only a fraction of the audience reported they were currently using social media as a marketing tool.
Lisa Donohue, president of Mediavest's Truth and Design group and an ANA attendee, told Jack Myers Media Business Report "the basic notion of building brands is not changing. But the tools at our disposal are different and better. Integration and the reinvention of media planning is happening, but every company has to decide what investments they are willing to make for the long haul. In this economy, we'll need to be flexible and what performs is what will stay."
Jim Stengel, in his final speech before retiring as CMO after a 25-year career at Procter & Gamble, offered ANA attendees "five lessons for marketing, branding and life.
1. Put people at the center of all we do. A brand is the collective intent of the people behind it.
2. Engage the heart and mind in everything we do.
3. Look at measures of brand health in addition to sales results. Evaluate results based on brand health, business/sales results and the [happiness/engagement] of the people involved.
4. Creativity needs to be a central component of marketing, branding and life.
5. Focus on the purpose behind your brand. Do good and have a reason for being.
Marketers and advertising agency executives who attended this year's ANA were generally upbeat and positive about the economic prospects for the industry, consistently repeating the mantra that advertising and marketing budgets need to be stable or increased during economic downturns. But they expressed private concerns that they would need to "accomplish more with less" in 2009. The pressures on chief marketing officers, who have an average corporate life span of only 22-months, and on their advertising agencies will be greater than ever. The economic crisis, which promises to intensify over the next several months, may actually accelerate major shifts in industry business models, advancing digital innovation and inspiration-based marketing opportunities.
Jack Myers Media Futurist: For more than two decades, Jack Myers has been the media industry's leading analyst, researcher and advisor on relationships among marketers, agencies and media sellers, providing business development services and custom insights on relationship best practices to more than 200 marketers, agencies, media companies and industry service providers. Jack can be reached at firstname.lastname@example.org.