Verizon’s new CMO faces multiple challenges—marketing experts outline the hurdles

Verizon Chief Marketing Officer Leslie Berland has a steep hill to climb in her new role with a wireless giant in need of fresh creative thinking to reverse lost market share, according to people close to the business. Berland, a former Peloton marketing executive, will oversee global brand and marketing strategy, including consumer insights, media and strategic partnerships when she starts in the post on Jan. 9, according to Verizon. She replaces Diego Scotti, whose exit was announced in May after an eight-year stint that saw him push big creative ideas while establishing a reputation as one of the most high-profile names in the marketing industry. Verizon declined to make Berland available for an interview. See our 2023 Marketers of the Year here Up for the job Berland is no stranger to challenged brands. After working at American Express for more than a decade, she joined Twitter (now known as X) in 2016 and worked for nearly seven years as CMO at the social media platform, leaving in late 2022 following Elon Musk’s takeover. At Twitter, she was lauded for her “people-first” approach that included broadening marketing beyond one siloed department. When Berland took the marketing helm at Peloton in January, the fitness brand and one-time pandemic darling was struggling to regain market share after consumers shifted away from home workouts and the company suffered pricey product recalls. Berland released a large marketing push that included real Peloton customers and their actual sweat, a broadened brand identity and a diversified agency roster. She also was involved with widening the brand’s reach to include a live-stream deal with the NBA, broadening access to customers beyond bike buyers. Look back: Peloton seeks comeback with brand refresh While Peloton is still posting negative results—revenue last quarter dropped 3.4% year over year—some analysts aren’t labeling it a lost cause. For example, in November, BMO Capital Markets Analyst Simeon Siegel wrote, “Challenges clearly continue, but priced for disaster [and] it didn’t feel like one,” in a research note about Peloton’s performance. MediaLink Chairman and CEO Michael Kassan said Berland, who he knows well, is “great for the role” of Verizon CMO because of her “broad-based experience in both a digital capacity at Twitter and a big brand in American Express. As for her personality, Kassan said she’s “a total professional. She’s going to be a pleasure.” That’s in contrast to Scotti, who was known to have a brash style and tense relationships with ad agencies, three people who worked with him had told Ad Age previously. Scotti did not immediately return a request for comment for this story. The need for ‘brand love’ Scotti was also known to be someone who “fiercely defends creativity and is a strong advocate for the need to invest in brand building,” a person who has worked with the former CMO had told Ad Age. Marketing experts want to see Berland revive the type of big branding campaigns Scotti had once driven. Scotti was known for his flashy, traditional advertising that included several Super Bowl commercials such as the McCann-created 2022 spot that starred Jim Carrey reprising his character from “The Cable Guy.” “Verizon’s biggest challenge is to create some brand love,” said Greg Paull, co-founder and principal of consultancy R3. “Consumers are easy to be critical on this category, and switching is common. Without the brand love for an Apple or Nike, building advocacy is difficult.” Super Bowl commercials Tracking the latest brand and agency plans Enter here Some branding experts said building the Verizon brand in a distinct way will be critical as it continues to try to win back mobile customers, particularly in its consumer unit, which accounts for the vast majority of the company’s revenue. In 2022, Verizon Wireless held the No.1 spot in market share, at 21.9%, among its competitors, including Deutsche Telekom and AT&T. But it still shed about 1.4% annually in market share from 2018 to 2022 as wireless carrier rivals such as T-Mobile and AT&T ate away at its customer base, according to market researcher IBISWorld’s Wireless Telecommunications Carriers in the U.S. March report. Lola Bakare, a CMO advisor, inclusive marketing strategist and owner of consultancy be/co, said Berland will have to define “what today’s version of [Verizon’s] distinct value proposition even is in a way that restores the brand’s former luster. I don’t think anyone knows what it stands for anymore … it’s a tall order, but the Verizon brand needs its marketing approach to achieve some differentiation in a sea of sameness the way a brand like Progressive has done in the insurance industry,” she said. Recent campaigns from Ogilvy, which Verizon hired to lead its consumer business in September, centered around the company partnering with YouTube on a promotion for “NFL Sunday Ticket” and its new myPlan offering. In October, Verizon responded to T-Mobile’s “Nada Yada Yada” ad with a campaign for its prepaid cellphone service, Verizon Visible, that enlisted actor Jason Alexander reprising his “Yada Yada” catchphrase from “Seinfeld.” The campaign called “BS” on its rival’s “BS-Free promise,” said Angie Klein, president of Verizon Value. Marketing department changes Since Scotti’s exit, Verizon has made some big marketing shifts, including changing agencies on its consumer account to WPP’s Ogilvy from Interpublic Group of Cos.’ McCann, in addition to a shuffling of responsibilities within its marketing department, according to two people close to the business. “(Berland) will need to find ways of reinvigorating the brand with a noticeable shift in tactics and brand messaging,” said one executive who has worked with Verizon and spoke on condition of anonymity. “In terms of what she should try to focus on, there’s a lot to do that doesn't necessarily fall within her remit … Obviously (Berland) has a challenge ahead of her. I think she comes with a strong digital marketing background so that will be valuable regardless.” When Scotti’s exit was announced, a person close to Verizon said the company was considering implementing a new structure that would embed marketing into different business units rather than appointing a new CMO. At the time, Chief Strategy Officer Rima Qureshi took on an interim leadership role over Verizon’s marketing organization. Though Verizon ultimately decided to appoint a CMO, it does seem some responsibilities have shifted to other departments since Scotti's exit, according to people familiar with the matter. But it’s unclear exactly which responsibilities moved and how permanent those shifts will be. For example, Rafael Rivero, who became chief media officer and senior VP of marketing effectiveness last October and has been with Verizon for 15 years, recently left, according to two people close to the business, including the executive who has worked with the company, who said “now that capability sits more within the business unit.” Verizon declined to comment on Rivero's departure or reports of the company shifting certain duties away from marketing. Rivero declined to comment. A third person close to the Verizon business said, though they didn’t have insight into which department currently oversees media effectiveness, that it would make sense for Berland to assume those responsibilities, given her time at Twitter, where she worked with brands to drive campaign efficiencies. It’s unclear whether Verizon will give Berland the reins to deliver the creativity experts want to see. “The CMO group will ultimately be more of a service group to the business units versus the strong driver's seat it had before to drive innovation and change across the business,” said the executive who has worked with Verizon, who remains skeptical. Cost efficiencies The executive said Verizon has been driving cost efficiencies across marketing and it’s led the team “to become very tactical and retail-driven around the consumer business.” As earlier reported, Scotti—who last week began his new role with PayPal as executive VP and general manager of a new consumer group and global marketing and communications organization—had been butting heads with others at Verizon over its efforts to drive cost efficiencies. Before his recent exit, Rivero had led many of Verizon’s recent cost-efficiency initiatives, that person said. Verizon CEO-Chairman Hans Vestberg implemented a new cost-cutting initiative last year that is expected to save the company $2 billion to $3 billion annually by 2025. To be sure, the company is still a massive advertiser—Verizon ranks as the nation’s 30th-largest advertiser, shelling out $3.56 billion in 2022, according to the Ad Age Datacenter. A Verizon spokesperson said it is “false” that the company is cutting costs within marketing, but did not comment on the larger cost-savings initiative. The executive who worked with Verizon said the company’s recent creative campaigns have been “just repeating a tired formula in the category. It isn’t breakthrough and is not differentiating Verizon in the category.” Kassan argued that Verizon just needed some fresh blood. People will always want to "see more and better" from a new marketing leader and Berland will deliver, Kassan said. "She brings together both strong brand marketing and performance marketing [skills]. She brings great experience to this role," he said. Contributing: Adrianne Pasquarelli and Garett Sloane

Verizon’s new CMO faces multiple challenges—marketing experts outline the hurdles

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