Exclusive: Fernando Machado on why he took the Activision Blizzard CMO job and how he views the future of gaming marketing

When asked about his new job running marketing for gaming giant Activision Blizzard, Fernando Machado can hardly contain his excitement. "I was telling a couple friends, I almost feel like closing my door here and screaming, ‘I’m working with video games!’ because I’ve always played video games since I was a kid and I believe it’s the future of entertainment," he says in his first interview since taking the chief marketing officer role at the company in April. This child-like energy is what those close to Machado identify as one of the key traits that propelled him to the top of the marketing profession during a stint as chief marketing officer at Burger King parent company Restaurant Brands International—a tenure during which he spawned buzz-worthy ads and social media campaigns that led to widespread attention and creative awards. As he makes the switch from burgers to gaming he enters an industry that has thrived during the pandemic, even as lockdowns upended its esports in-person competitions. Worldwide revenue at Activision Blizzard surged by 25% in 2020 to $8.1 billion and in 2020. Meanwhile, the company’s worldwide ad spending jumped by 27% to $746 million, according to Ad Age Datacenter, with big pushes around titles like “Call of Duty: Warzone” and “Tony Hawk’s Pro Skater 1+2.” But as America emerges from pandemic lockdowns, Machado must find ways to keep Activision Blizzard's momentum going as it competes for gamers against competitors such as Electronic Arts and Epic Games. With more than 400 million players in 190 countries, the company has a goal to reach 1 billion players. Ad Age spoke with Machado and Activision Blizzard CEO Bobby Kotick on what to expect with the change in command. The two address the need to keep up a player-first mentality, the importance of gaining more insights from players, finding relevant partnerships and how creativity and a constant stream of content will help drive the future of its franchises. Why did you choose now to make the leap from Restaurant Brands International to Activision Blizzard? Machado: It felt like a good time and an excellent opportunity. [My son] Leo is obsessed [with video games] just like I was when I was his age. The type of marketing that I grew up doing and that I enjoy doing has creativity at the center. I truly believe that creativity is at the heart of Activision Blizzard and am truly inspired by Bob’s vision of reaching 1 billion players. The only way to do that is if we are creative and continue to invest behind creativity. Why did Activision Blizzard hire Machado as CMO and what makes him the right leader for the brand? Kotick: We generally have a philosophy that we want the most talented and inspired creative people in the world. I asked people who are engaged in marketing: Who is the most inspired, creative, thoughtful marketer in the world? Universally, I kept hearing Fernando. It made it very easy. I don’t believe there’s a more respected marketer and there’s very few people who have the track record of inspiration and creativity and innovation that Fernando had. For us, it’s making sure we reinforce in our culture the value of inspiration and creativity. You can only do that by having the most inspired, creative leadership and Fernando is that. Machado: I’ve walked into a place—and that’s metaphorically because I’ve done more Zooms than walking into anywhere—that has creativity at its heart. It’s not normal to have such a creative CEO. It really runs in the blood of the organization. I feel really at home. What areas will Machado be overseeing at Activism Blizzard? Will that include esports? If so, how might you be working with that division? Kotick: Yeah, it’s all marketing. A big part of the opportunity and the responsibility is how do you curate the content, the communications and the experiences of the third, maybe fourth, biggest network in the western world. It’s twice the size of Netflix. We’re much bigger than Twitter. The other thing I think is there’s a unique opportunity for us to gain insights and inspiration from our players themselves. A big part of the marketing opportunity for us is to ensure that we are regularly communicating with our players to understand their needs, their tastes and their interests, and then informing our studios and product development teams in a way that can improve and enhance how they think about new products. Machado: To Bobby’s point, everyone I talk to, the expression around having a player-first mentality is a very common. It’s really about understanding the community and providing opportunities for connection through entertainment. It’s why our franchises are so successful. They truly bring people together. We have the perfect platform to continue to grow across the entire portfolio. What can we expect from Activision Blizzard through this new change? Will there be any change in strategy? Machado: Before changing things and trying to invent things, at least from my perspective, I need to learn and find ways to help the team—that is already doing great things—do things that are even greater. If I’m looking from the outside in, I do think that gaming as a whole is evolving. It’s almost like people used to play a game and now people own that game. If I think about the titles, we are creating amazing virtual worlds that provide ongoing entertainment that bring people together, so naturally I think the franchises will need to have a constant stream of content that engages people, which we’re basically doing already, so I’ve come to help. Will you be bringing some of your trademark stunt-driven campaign approaches to RBI? With Burger King, you often hacked into the gaming space for fun stunts and ad campaigns. How will you feel with other brands now hacking into your sphere? Machado: At RBI I did lots of projects that got a ton of traction in terms of media and social media sharing. Activision Blizzard is already doing a lot of that, so probably yes, but it might not be something completely different than what they’re doing. We will definitely look into doing partnerships because I think it’s a really cool way for brands to be part of pop culture. We own our intellectual property so there’s a lot of companies that want to partner with us. It’s about finding the right partners and finding ways to infuse our franchises into pop culture, which was already happening organically because gaming is already part of pop culture and part of the zeitgeist. How will the new appointment move the gaming world forward in terms of creativity? Will competitors seek to hire their own ‘rockstar’ CMOs? Kotick: One of the things I think is appealing about the opportunity is you have to have a culture and a leadership team and a willingness to allow people to take creative risks and I can’t tell you that the companies we compete against have that opportunity. If you’re a marketer, you want to come to a place that owns all its intellectual property. We own everything we make so you can influence the creative outcome of the franchise in a way that is different than a lot of our competitors who rely on licensed games or who maybe have too much of a reliance on the development team’s view of how you should market or no real appreciation at all for consumer marketing. Will Activision Blizzard continue working with its agencies? Will you be bringing on any talent you’ve worked with in the past. Machado: Today there is no plan on changing any agency in our roster, but I’m still learning and building those relationships. Some of the agencies I have never worked with before, so I want to speak with them and understand the work they’ve done for the different franchises. I spent some good time when I went to L.A. last week with 72andSunny. They have been doing some of our brands’ work, and especially “Call of Duty” for many years, and they have a very strong team there. We’re always looks for good talent, not just on the agency side but on the marketing teams. We are growing so much, we have such ambitious plans, we have such a compelling vision around reaching players, but we can only do that if we put creativity at the center, creativity at the heart. That’s Bobby’s vision for the company. Gaming has been on such an upswing during the pandemic. Everyone is gaming now. Does the upswing in livestreaming and esports contribute to wanting a player-first mentality? Kotick: For us, esports is the ultimate opportunity to truly celebrate and recognize the accomplishments of our players. While the last year there’s been more opportunity for viewership, for us it really is important to get people back into those physical surroundings where you can feel the excitement and enthusiasm of the crowd. Is there a timeframe for when you think you can get to 1 billion players? Kotick: I tell them by Thursday. No, really it is not about the when you get there, it’s the how you get there. What will you miss about the food space? Machado: I really enjoyed the journey at RBI. I think I left a very strong team behind. But, at least for me, it’s my past. It’s like missing college. I would never want to go back to college.

Exclusive: Fernando Machado on why he took the Activision Blizzard CMO job and how he views the future of gaming marketing

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