Commentary by Jonah Bloom

McDonald's, Ford, GE Are Learning to Risk Failure

Corporate Culture Must Change in Consumer-Controlled World

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Give or take a few ostrich organizations whose marketing minds are stuck in the TV-as-total-solution sand, there is consensus: The consumer is in control. Every speech, every conversation at the recent ANA conference
Jonah Bloom, executive editor of Advertising Age.
confirmed this is not just some journalistic refrain oft-read in Advertising Age, but a real-world issue confronted daily by most marketers.

Still, however, marketers face the challenge of changing their companies' cultures, structures, strategies and tactics to succeed in the consumer-empowered world. Some are already traveling down that road, while others remain at the acceptance-only phase. One media chief says: "I hear the CMO saying the old way is broken, but when his brand manager talks to us it's still, TV, TV, TV." So how to change?

Inculcate adventurousness: Marketers that have overhauled their approach overcame conservatism. At McDonald's, CMO Larry Light says it was about "learning to win," instead of "learning not to lose." At Ford, which has shifted from spending 2% to 20% of U.S. budget in nontraditional ways, it was about encouraging risk by tolerating failure. In the words of Ford marketing manager Richard Stoddart: "You have to be prepared for mistakes. From the start you make it clear these aren't failures but a learning process."

Get a mandate from the top: Light says the late CEO Jim Cantalupo was the real catalyst for change at McDonald's. GE's CMO Beth Comstock says she couldn't have initiated change without Jeff Immelt's appreciation of marketing and innovation. Jim Stengel's greatest strength at P&G might be the fact that CEO A.G. Lafley is actively involved in evolving the company's marketing strategy.

Avoid committees: Light, leaning heavily on a phrase also embraced by David Ogilvy, told the ANA that no one ever "erected a statue to a committee." Ian Beavis, the senior vice president of marketing at

Marketing executives today face decisions about which road to take toward an unknown horizon.
Mitsubishi, which recently pulled much of its budget out of broadcast TV, agrees. "Corporations can be bureaucratic and slow to adapt," he says. "That's why smaller players so often react faster. Change isn't a time for democracy. No one follows a committee into battle. You need one empowered leader."

Integrate: Departments focused on one medium or discipline -- traditional media, interactive, PR -- can end up championing their medium's cause, not focusing on the consumer. Beavis says: "Compartmentalized marketing isn't always best; that's why I resist putting in a media manager." At Ford that might be unrealistic, but Stoddart still stresses integration. "If you're looking at a plan that doesn't include everything up front, you're in trouble. Too often marketers feel they have to plan media in advance, everything else becomes an afterthought."

Fund change: Stoddart and Comstock stress the need to pony up, whether it be improving databases, hiring the right skill sets or budgeting for a long-term program. In Stoddart's words, "it's about having the tools but, also, once you invest, it makes you act on your plans." Stoddart also warns against getting stuck in trial phase: "It's easy to keep testing new things, but at some point you have to take what worked and put it into practice."

Most marketers accept the inevitable obsolescence of the old model. The question now is whether they're building a new one.

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