ANA 2009

ANA Urges Marketers: We Must Be the Ones to Lead the Country Out of Recession

IBM, Walmart, McD's Held Up as Examples of Building on Brand Core

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PHOENIX ( -- If someone is going to lead the U.S. out of recession, the Association of National Advertisers made a case that it should be the marketers, trotting out a group of CMOs to detail how they've led major turnarounds or fueled record growth during the group's annual conference.

Walmart CMO Stephen Quinn at the ANA Annual Conference
Walmart CMO Stephen Quinn at the ANA Annual Conference Credit: Clarion Pictures
This is the second year the ANA has pushed the growth theme. Last time, the idea was swamped by a global economy teetering on the brink of utter collapse. With things less dire, the message became easier to believe this year.

Walmart CMO Stephen Quinn, who's led a marketing effort to reinvent earth's biggest retailer, was Exhibit One in the case that marketers should take charge. It may be a sign of the ascendancy of marketing there that he's claiming legendary founder Sam Walton as part of his department. "I would argue that Sam Walton was one of the most brilliant marketers who ever lived," Mr. Quinn said.

That may come as a surprise to veterans of the retailer and Walmart supplier base who recall the retail titan having relatively little regard for advertising. But as Mr. Quinn said, "Marketing is so much more than that. It's making sure everything your company does is customer-focused. [Mr. Walton] was naturally focused on the customer, which really is marketing."

Walmart had lost its way in that regard five years ago, he said, and marketing was in disarray, too. "We mistook being very entrepreneurial and decentralized as a virtue in itself," he said. "We lost focus on the customer and the brand. ... We didn't have the fundamentals of brand management anywhere in the company."

Reclaiming mantle
While retailers generally, and Walmart specifically, long have needed to focus on store operations and supply-chain issues, marketers need to take the lead in steering a consumer-focused direction to those other disciplines, he said.

McDonald's CMO Neil Golden likewise credited a marketing transformation for the turnaround of earth's biggest fast-feeder -- and for leading its transformation toward focus on multicultural marketing to remain relevant.

Mr. Golden said that his company in 2000 "had lost its way." It was focusing on limited-time promotions and partnerships with other properties that subordinated the McDonald's brand. At the time, he said, the marketers wanted to get back to the glory of "Nothin' but net" and "You deserve a break today."

Modernizing McDonald's today means marketing informed first and foremost by ethnic insights. "Ethnic segments are leading lifestyle trends," he said. They're also where a lot of the money is. Mr. Golden said that 40% of McDonald's current U.S. business comes from the Hispanic, Asian and African-American markets, and 50% of consumers under the age of 13 are from those segments. "They're among our most loyal users," he said.

The chief marketers of Walmart, McDonald's and IBM all focused on understanding what their brands were about at their core, then building from there.

MillerCoors CMO Andrew England also drove home how understanding Coors' unique proposition -- essentially cold beer -- and driving it home, primarily via TV ads on NFL and other sports broadcasts, had helped lead to five straight years of volume growth. He made the case for the strong CMO, arguing that they should own the profit-and-loss statement in their companies.

Even Google CEO Eric Schmidt did some navel-gazing during the Q&A on how Google needs to remain true to its innovation culture, despite its size. "I worry that we will slow down," he said, "for the reasons that all successful high-tech companies do. ... We don't look so much about our competitors but what the opportunity is in front of us."

Mr. Schmidt, somewhat ironically and anachronistically reading from a paper script, said he's resigned himself to the fact that because of its size, and the fact that it's "a disruptor," Google will always be a lightning rod for controversy.

Despite many efforts to do other things, however, he noted Google still gets 97% to 98% of its revenue from search ads. Moves to broker radio and print advertising, he said, have failed because of the lack of a back-channel to measure consumer response, he said. He still believes TV will be different because set-top box data does provide that back channel.

Keeping with the theme, he gave hope that a new generation of marketing technology can lead growth.

"We are in the advertising business," he said. "And we like advertising."

Stepping up
Of course, Google doesn't do much of it itself. But he said the brand has been built one consumer at a time primarily through personal experience, and is stepping up billboard and print advertising to reach important audiences.

The rise of smartphones, cloud computing and a new generation of agencies designed to take advantage of their capability will transform advertising, and he said Google is also building models to support consumer control over who can market to them.

He believes the end game of the privacy debate will be rules that allow consumers to opt out, but said marketer and media responsibility are key. "I can think of 10 creepy things we can do with [our] information that would really get people excited," Mr. Schmidt said, "negatively, I might add."

More action at the ANA

Think it's impossible to be both cool and possess an AOL e-mail account? Think again. Or, at least, think again if you think Kevin Bacon is cool.

BACON: Footloose, not fancy-free.
BACON: Footloose, not fancy-free.
Yes, the actor who's entertained millions of moviegoers with fare such as "Wild Things," and far fewer music lovers with his band The Bacon Brothers, gets his electronic mail the oldish-school way -- and he wasn't embarrassed to tell a roomful of marketers about it at the ANA's annual conference.

"My e-mail address is. ... Oh never mind," he joked, possibly disappointing some. Nevertheless, it's certain that no one was left wanting by the Bacon Brothers' rousing rendition of "Footloose." It came complete with dance moves from Mr. Bacon, who was one of the many swindled by Bernie Madoff, leaving him to tell Life & Style magazine in January: "I don't have anything lined up right now, but I need to work, for obvious reasons."

Once again, AOL pulled out all the stops in its effort to rouse the jet-weary on the confab's opening night. As if Mr. Bacon wasn't enough, there was an appearance by another handsome fellow, Simon Baker, star of the hit CBS show "The Mentalist." On his mind was all the exclusive content coming your way, which was revealed during a chat with a company executive.

Those who staggered to breakfast the next morning were greeted with this hangover helper: Sponsor Lippincott shared results from a recent survey, showing that brands with strong brand experiences and compelling stories are able to drive loyalty and sales results while spending less on media than counterparts who aren't connecting as well.

Here are a few other snippets of action:

  • Elevating the standing of marketing within corporations is a key priority for the ANA, but the membership indicates there's still a journey. Asked in a flash poll how other C-suite executives view marketing expenses, 8% said it's viewed as an unnecessary expense; 25% said it's seen as unaccountable but necessary; 57% said it's seen as an investment in brand building; and 10% weren't sure.
  • How have marketers responded to the recession? Not surprisingly, 44% of respondents to a flash poll at the ANA had cut their budgets. The optimistic view would be that 56% did not. In all, 7% of marketers said they made no change; 18% increased budgets; 17% kept budgets the same but reallocated, and another 14% shifted money from traditional to non-traditional media.
  • Last year, ANA attendees elected Barack Obama as Ad Age's marketer of the year. This year, they're not so keen on what he's doing for them. Asked in a flash poll what the impact of his administration has been on marketers and their ability to advertise, 9% said it was favorable, 24% unfavorable, and 67% said it was too soon to tell.
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