Newell's marketing headcount is down 20% during Mr. Davies time
at the helm and located in fewer sites. And Newell has gone from 65
marketing-services shops to six, which includes creative agency
BBH, media shop PHD and four research shops.
Despite the culling, the company opened a 130-person marketing
floor at its corporate headquarters in Atlanta along with growing
outposts in Shanghai and Sao Paulo and a center for writing
instruments in London. And Newell has roughly doubled its
market-research staff to more than 20 and seen a similar rise in
its overall spending on research. It's also preparing to ramp up
spending on media.
Now comes the hard part: proving it all works, especially since
the approach is in many ways at odds with standard practice at big
multibrand behemoths like Procter &
Gamble Co. and his alma mater Unilever.
When Mr. Davies was lured to Newell by CEO Mike Polk in late 2012, he quickly saw the
need for change. Former CMO Ted Woehrle was in charge of developing
capabilities, processes and training, but the marketing
organization had no central authority. Instead it was divided up
among business units that controlled their own marketing budgets
and decisions.
One consequence, Mr. Davies said, was "a lack of investment in
consumer understanding," with some brands relying on consumer-habit
studies that were 10 years old. Marketing people and spending also
weren't aligned with company priorities such as growing in Asia,
Latin America and writing instruments.
By consolidating into a single marketing department, Mr. Davies
said he could increase "consumer insights" spending while reducing
spending overall.
"I've got people in fewer places and can move them to work
across categories," Mr. Davies said. "I can offer career advantages
more easily. We can move approaches that work in one category much
more easily into others."
The consolidation also made it possible to trim agencies and
attract the likes of BBH and PHD, which never would have considered
a $250 million account divided among so many category and country
fiefdoms as the old Newell had, Mr. Davies said.
To find those agencies, named in October following reviews, Mr.
Davies rejected the conventional pitch process he finds "a complete
waste of time and agency resources." Instead, he talked with agency
leaders about such things as "what makes great advertising and what
work they've done it the past they're proud of and what could be
improved."
Part of that is based on Mr. Davies theory that "any big agency
can hire great talent. It then comes down to the quality of the
leadership. How do they want to work with us? How do they find us
as a client?"
Making that process easier was that Mr. Davies was the decision
maker. "My predecessor was responsible for marketing as a
capability, developing skills and training," Mr. Davies said. "I
look after that, but I also look after the day job of marketing.
I'm responsible for the advertising and mix development. And that's
really helpful, because as we develop new approaches, processes and
techniques, I don't need to persuade people to do it, that it's a
good idea. I can tell them to do it."
Should that be the model, rather than the one of CMO as
influencer in many big multibrand companies?
"Certainly for a company our size, we don't have the time to go
around trying to influence people that this is how they should do
things," he said. "Maybe some of the bigger companies don't have
the time either. I don't know."
Perhaps an even bigger departure for Newell's marketing
department under Mr. Davies is the unprecedented authority for
market research, which also reports to him. While Mr. Davies wants
product concepts and ad ideas tested with consumers, he's also
given researchers authority to tell marketers an idea isn't even
worth testing yet.
Mr. Davies believes such power should be the rule rather than
the exception, because researchers are the voice of the consumer.
"You lose count of the number of companies who claim the consumer
is boss," he said. "But the question is do they really make the
consumer the boss or not? I think by having a strong, independent
[research] function you're a hell of a lot closer to doing
that."
Of course, the market ultimately will judge. Mr. Davies pointed
to market-share gains after Newell research showed the importance
of a free-flowing pen to consumers. That translated last year into
Paper Mate InkJoy pens, backed by heavy sampling combined with TV
ads focused on how easily the pen flows.
Newell parlayed another insight -- that Brazilian construction
workers were spending too much of their hard-earned cash on saw
blades -- into a two-sided replacement blade from its Irwin tool
division, which was also backed by heavy sampling.
"These are encouraging signs," Mr. Davies said. But he
acknowledged: "2014 and 2015 will be the acid test."
