Anheuser-Busch InBev’s Busch Media Group was Ahead of Its Time

In your articleamp160you stated amp8220Last year AnheuserBusch InBev decided to outsource media buying bringing about an end to the Busch Media Group BMG The fact that one of the biggest advertisers with the most resources could not make inhouse buying work is a prime example of the resources and experience media buyers bring to the table They apparently realized media buying wasnamp8217t all about deal making It is a complex landscape and if you donamp8217t know how to navigate the terrain you will loseamp8221As background I had the privilege of being the last person to run BMG AB InBevamp8217s inhouse media and sports sponsorship group that was dissolved at the end of last yearamp160 Technically I wasnamp8217t the last person to head up BMG but for all intent and purposes I was as the last leader was just a caretaker to dismantle the groupSo whatamp8217s my message BMG was a tremendous advantage for the company that was ahead of its time continued to evolve over time and couldamp8217ve continued to be for a long time to comeamp160 BMG delivered financial benefits tangible added value benefits and streamlined work processes and communication that an external media agency could only dream ofI want to call out the extraordinary vision by the late Chuck Fruit to create BMG in the late 80amp8217s and early 90amp8217samp160 At that time before the rise of media departments spinning off into independent media agencies he had the foresight to understand the importance of media within marketing and determined he could build an internal team of not only media experts but beer industry experts that could service both the complex web of internal constituents wholesalers regional sales and marketing personnel and the marketing organization and the growing list of media sports and entertainment partnersEven back then Chuck recognized that media is about far more than efficient buying and now more than ever And as you so enthusiastically call out it requires strategic partnerships that are mutually beneficial This is another reason why BMG was so brilliantamp160 There is no one who cares more about the strategic direction of an organization the results of their work or who have a desire to take things to the next level than people who actually work at the companyamp160 Talk about everyone wanting a quotwinwinquot partnership this translated at both the national and local levels across all functions and disciplinesAnd that vision paid off for two decades after Chuck left for CocaCola through the strategy and execution delivered by Tony Ponturo Peter McLoughlin and Mark Wright who developed BMG into one of the industryamp8217s most respected media agencies regardless of whether it was inhouse or part of an agency holding companyamp160 They pioneered amp8220best inclass goldstandardamp8221 ideas and processes within media entertainment and sports sponsorship and built strong direct relationships across the industry that helped propel AnheuserBusch to a 50 share of the US beer marketBefore I took the job at AB InBev I used to call on the client as a Sales Director at ESPNamp160 I always wondered amp8220When is AB InBev going to hire a media agencyamp8221amp160 I mean why would you have an inhouse agency especially for a piece of business as large as this oneamp160 Wouldnamp8217t it be better easier more efficient etc to have one of the big media agenciesamp160 After I joined BMG the quality of the work people their knowledge of the business and their ability to deliver significant savings and value was second to noneamp160 My sentiment quickly changed to amp8220Why would AB InBev ever hire a media agencyamp8221The beginning of the end of BMG was in the second half of 2011 just before I joined when it was decided that media planning should be outsourced to a media agency partly to save money and partly because the perceived thinking was media planning could be done better with an external agency and all of its perceived innovation talent and resourcesamp160amp160While on paper it sounded like a great idea in reality it wasnamp8217t the right solutionamp160 First of all the reduction in internal headcount didnamp8217t offset the incremental cost in an external media agencyamp160 And more importantly the separation of planning and buying across an internal and external organization did not optimize a media process that in todayamp8217s world has to be more in sync than ever beforeamp160 Media planning and buying need to be together within one organizationamp160 Ultimately you have an external agency focused on trying to get the piece of the business they donamp8217t have media buying while at the same time trying to service and have a relationship with the very media client they are trying to put out of businessThe argument presented by the media agency was that BMG was built for scale and big traditional sports deals but that todayamp8217s marketplace demanded an ever evolving agile approach to systems dataanalytics targetingoptimization social mobile search video and programmatic buyingTo all of that I say the following Yes BMG was originally built for the media marketplace of the early amp821690s but over time BMG was as much in step with any media agency or even ahead of itamp160 Despite having large scale sports commitments BMG continued to move money to digital tripling it over the three years I was thereamp160 It was BMG that pushed for the organization to create a digital marketing group at a time when the company lagged significantly behind most companies in digital acumenAnd I throw out a failure as an example of BMGamp8217s forward thinking Remember when budtv launched in Feb 2007amp160 Ultimately it met its demise two years later So many brands today talk about being amp8220content creatorsamp8221 but AnheuserBusch took a real gamble to create the first brandled digital entertainment network before anyone was talking about content creation and curationamp160 There are other examples of BMGamp8217s ingenuity and risktaking but the point is that it had always evolved and could do so for the futureThe media planning agency also claimed that todayamp8217s media world required different structures and skill setsamp160 BMG had a digital media team that was second to noneamp160 I would put them up against any media agency personnel that I have metamp160 With no increase in staff they were able to execute the growing budgets flawlessly utilizing the latest platforms measurement techniques and technology to stay on the leading edgeamp160 BMG was already set up to deliver success because they had the infrastructure in place to deliver in the new media worldamp160 But more to the point with continued investment and proper staffing I have no doubts that BMG could have continued to deliver exceptional benefits for the company longtermamp160 With such a strong aversion to adding headcount and other resources amongst senior leadership and such a bullish approach to outsourcing it created lessthanideal standards by which BMG was evaluatedOne of the best known issues in the industry is talent turnover With an inhouse model there was truly the opportunity to leverage years of experience build on past successes apply key data and learnings into optimization and future media plan development This flies in the face of the media industry now It is a nightmare to keep continuity on media teams fueling one of the reasons so many clients put their account up for review or now make demands that agency personnel have to be willing to commit to 2 years on the same piece of business Inhouse personnel also streamlined all decision making where a quotyesquot was a quotyesquot from BMG and a quotnoquot was a quotnoquot This direct way of doing business and making decisions made it exciting for media partners to bring us new opportunities before anyone elseSo why am I so passionate about BMG and compelled to write this nowamp160 Not only because of what you wrote but all of the other fallacies being thrown around in the marketplace about BMG and the benefit of an external media agencyamp160 My final exclamation point to this is the amount of amp8220savingsamp8221 that an external media agency could bring to the business compared to BMGamp160 A piece of the transparency puzzle that doesnamp8217t get talked about as much is the lack of accountability for the savings promises delivered during the pitch process and the execution of supposed savings once an agency wins the businessamp160The new media buying agency promised ninefigure savings in the first year 2015amp160 That39s impossible given what I know about the BMG ratesamp160 On a straight applestoapples comparison of inventory and media we all know that canamp8217t be doneamp160 So what you end up with is a media strategy dictated by savings targets The agency canamp8217t spend with certain media partners because they canamp8217t deliver enough savings or instead of buying targeted inventory theyamp8217ll buy broad rotations or cheap nonviewable open web programmatic inventoryamp160 We all know the tricks of the trade to demonstrate amp8220savingsamp8221 but at the end of the day none of these amp8220savingsamp8221 tactics will grow brands and deliver effectivenessWe will probably never see another client set up the inhouse capabilities that BMG had which is a shame because I witnessed firsthand how powerful this structure can beamp160 Itamp8217s too hard to get the headcount and resources to start from the ground upamp160 AB InBev had a competitive advantage with top tier talent across all disciplines and geographies that delivered substantial benefits to the organizationBest regards Blaise Damp8217SylvaThe opinions and points of view expressed in this commentary are exclusively the views of the author and do not necessarily represent the views of MediaVillageMyersBizNet management or associated bloggers

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Anheuser-Busch InBev’s Busch Media Group was Ahead of Its Time

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Blaise D'Sylva

"About That with Carl Mayer:" Alaina Donnellon (Episode 6) - By Carl Mayer

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