What to expect at a more freewheeling-than-usual ANA confab this week

We’re off to see marketing’s big show The annual Masters of Marketing conference takes on more of a freewheeling tone as marketers grapple with a range of issues, from media transparency to purpose to the changing CMO role By E.J. Schultz and Jack Neff Published on September 30, 2019 Illustration by Andrea D’Aquino The corporate era is rapidly coming to an end. So says the description of a presentation slotted for this year’s Association of National Advertisers annual “Masters of Marketing” conference, which begins Wednesday in Orlando, drawing an estimated 2,900 industry execs to the Rosen Shingle Creek resort over four days. The talk, called “Built to Suck,” by strategic consultant Joseph Jaffe, seems an odd choice for an event that lures marketing execs from some of the biggest corporations in the world. But Jaffe’s presentation—which promises to answer the question “Can brands be saved?”—shows how the ANA is trying to spice up its biggest event of the year, while appealing to modern-day marketers whose purview extends way beyond traditional advertising. “Built to Suck” is part of the conference’s “second stage” venue, which the ANA debuted last year to provide counterprogramming to the main stage agenda that is typically filled with solo presentations by Fortune 500 chief marketing officers. The corporate era is rapidly coming to an end. So says the description of a presentation slotted for this year’s Association of National Advertisers annual “Masters of Marketing” conference, which begins Wednesday in Orlando, drawing an estimated 2,900 industry execs to the Rosen Shingle Creek resort over four days. The talk, called “Built to Suck,” by strategic consultant Joseph Jaffe, seems an odd choice for an event that lures marketing execs from some of the biggest corporations in the world. But Jaffe’s presentation—which promises to answer the question “Can brands be saved?”—shows how the ANA is trying to spice up its biggest event of the year, while appealing to modern-day marketers whose purview extends way beyond traditional advertising. “Built to Suck” is part of the conference’s “second stage” venue, which the ANA debuted last year to provide counterprogramming to the main stage agenda that is typically filled with solo presentations by Fortune 500 chief marketing officers. “The conference has become freewheeling. It’s less structured than it used to be,” says agency search consultant Avi Dan, who’s been coming to the event for more than 20 years in a row. The ANA has no choice but to evolve. Chief marketing officers are thirsty for an outsider’s perspective as they try to keep pace with changes sweeping the industry, including controversies surrounding the transparency of U.S. media buying practices that has sparked a probe by the Federal Bureau of Investigation. On Friday, the second stage will feature a presentation on the “State of Media 2020.” It will be delivered by Charlie Chappell, Hershey Co.’s head of integrated media and communications planning, who will discuss trends including “OTT, retailers as media companies, audio, transparency, and building trust in the new media ecosystem,” according to the agenda. “The agenda of the Masters has always been to have a CMO on stage,” says ANA CEO Bob Liodice. But the second stage provides an opportunity for other speakers with “different perspectives on the state and health of our industry to provide commentary in a different way that might be of interest to some of our constituency.” Last year, the second stage often upstaged the main stage: Investment banker Terry Kawaja of Luma Partners had the crowd buzzing with a talk called “Fire your CMO”—about how scrappy direct-to-consumer startups were eating away at big established behemoths like Procter & Gamble Co. by using highly tailored marketing based on first-party data and artificial intelligence. The big companies might have taken Kawaja’s words to heart—in the year since his talk, many have borrowed from the d-to-c playbook. Of course, CMOs still want to hear from their peers, too, and there will be plenty of that. This year’s agenda includes presentations by top marketers at Procter & Gamble, Bank of America, Anheuser-Busch InBev, Target and Fiat Chrysler. Jason Levine, who joined hummus maker Sabra as its CMO this year after 19 years at Mondelez International and its predecessors, is attending his first Masters this year. He says he is eager to be inspired and hear about “the big challenges that everyone is wrestling with.” There are no shortages of challenges, to be sure. Below, a look at some of the big topics that are likely to surface this week: Transparency At last year’s Masters, news of the FBI’s burgeoning investigation of U.S. media buying practices was top of mind, prompting Kawaja to troll the event by wearing an FBI jacket. The jacket might not return this year, but the topic won’t go away. The Justice Department in the past year has subpoenaed two outdoor advertising executives plus executives of Havas and LVMH, in a wide-ranging probe, according to people familiar with the matter. Havas and LVMH declined to comment. More broadly, a lot has happened on the media transparency front in the four years since former Mediacom CEO Jon Mandel delivered a blistering speech before the ANA accusing media agencies of widespread undisclosed rebates and other hidden revenue-generating deals in the U.S. The ANA later commissioned K2 Intelligence for a report that detailed widespread non-transparent dealings but declined to name names. An ANA survey earlier this year found more than two-thirds of advertisers (69 percent) have updated media agency contracts in the past three years since the K2 report. Much of that is based on a model contract Ebiquity developed for the ANA. Liodice says it is a “very good sign” that so many marketers have reviewed their contracts. “Marketers have as much responsibility to navigate their agency relationships as anyone,” he says. “They just can’t defer that accountability and responsibility to the agencies or to the media that they are specifically connected with. They own it. It’s their business. It’s their agenda. It’s their money.” But Stephen Broderick, CEO of consultancy FirmDecisions, a unit of Ebiquity that helped develop the ANA’s model contract, says the real test will come in late 2019 and early 2020, as clients begin to audit agency performance under new contracts signed in 2017. “We’re auditing those contracts now,” Broderick says. “I can categorically tell you things have not gotten better. If anything, they’ve gotten slightly worse, because what we’re seeing now, as perhaps expected, is that there’s more intent to what the agencies are doing.” That implies, he says, that agencies are “setting out with an intent to circumvent their obligations, or intentionally signing up to certain practices and contracts knowing they’re going to do the opposite.” Volume-based cash rebates have gone away, Broderick says. But he sees more deals where media companies pay agencies for service contracts of questionable value, or commingled buys where agencies leverage the collective buying power of clients to get low-cost inventory on their own accounts, which in turn they can resell to clients. Marla Kaplowitz, president-CEO of agency trade organization 4A’s, takes issue with the idea that transparency issues are widespread. There have been “close to 100 audits and no one has paid money back,” she says. “Clients wanted to make sure they were getting what they were promised, and that is the goal of every agency—to make sure that they are delivering against that.” She remains critical of the ANA’s K2 report. “The biggest frustration then and now is you are vilifying an entire industry when you never named names, you never clarified who the guilty parties were.” Measurement The ANA has pushed for better measurement across media for a decade through such efforts as the cross-industry Making Measurement Make Sense (3MS) initiative. Liodice, who will deliver conference opening remarks on Thursday, has tangible good news to report on this front: The Media Rating Council earlier this month released a final version of its cross-media measurement standards for video, which give marketers and agencies much of what they’ve wanted by standardizing measurement around gross rating points across digital and traditional linear TV. The new standards incorporate a tougher viewability standard that now requires an ad be 100 percent in view for at least two seconds. The MRC standard also requires sound to be measured, but it’s up to media, agencies and marketers to determine if that affects payment. Duration weighting, a more controversial aspect of the standards, won’t go into effect until January 2021, giving the MRC and others more time for additional research and possible revisions. This standard bases payment on the percentage of an ad actually viewed. Since all provisions apply both to digital and linear TV, the practical effect of the standards get marketers, and Liodice, closer to something they’ve wanted for a decade—individual TV commercial ratings. “These are great statements of intent right now,” Liodice says. “But there is a lot of work to be done.” Though progress has been made, the new standards don’t solve everything. Nearly three years after Procter & Gamble Co. Chief Brand Officer and ANA Chairman Marc Pritchard made a high-profile call for them to do so, big digital players such as Facebook, Google and others still don’t have MRC accreditation for all of their third-party audience measurement. Individual measurement firms still need MRC accreditation for their cross-media measurements. And restrictions by digital “walled gardens” on sharing even anonymized individual data across platforms also limits the quality of those cross-media video measurements. But P&G also feels it’s been able to make enough progress to cut media spending in recent years while delivering faster top-line growth by limiting the number of times people see the same ads. “If you think about what a go-to-market leader’s job is, it’s really to activate that customer, get them off their butts and do something and grow the business. The industry is so focused on the [CMO] job title and not focused enough on what impact you are having on your client’s business.” Norm Yuston, Russell Reynolds Associates The role of the CMO If past Masters events are any indication, there will be a good bit of navel-gazing about the evolution of the CMO role and how marketers are expected to take on a lot more than advertising oversight, with everything from data management to customer loyalty programs and PR now on their plates. (Ally’s Andrea Brimmer, who is scheduled to present on Thursday, carries the dual title of Chief Marketing and Public Relations Officer, for instance.) The CMO title itself is under scrutiny as more companies gravitate to labels like “chief experrience officer” and “chief commercial officer.” Norm Yustin, who leads the chief marketing officer practice at executive recruitment firm Russell Reynolds Associates, estimates there are now about a dozen titles being used for the top marketing role. To reflect this, Russell Reynolds later this year will rename its chief marketer practice to “customer activation and growth,” says Yustin, who will be attending Masters. “We want to focus on what our clients needs are, not necessarily the job title,” he says. “If you think about what a go-to-market leader’s job is, it’s really to activate that customer, get them off their butts and do something and grow the business.” State of purpose The ANA has long used “driving growth” as the theme for the Masters event. But it might as well be “purpose.” By one account in an April ANA Media Conference presentation, 98 percent of Masters of Marketing presentations last year referenced purpose-based marketing in some way. Unilever CEO Alan Jope, who won’t be presenting at the ANA this year, made some news at Cannes by putting brands on notice that, within a few years, they need to find deeper purpose than just their basic product function or face possible divestment, because purpose-driven brands like Dove and Ben & Jerry’s are shown to fare better. Embracing purpose might sound innocent enough, but it doesn’t come without risk. A study released last week by Morning Consult showed 53 percent of adults say corporations have become more political in recent years. That can have mixed results, since 29 percent of consumers say they’ve stopped buying from a brand because of a political stance, while just 15 percent say they’ve spent money to support a brand because of its political stance. Morning Consult found wealthy, well-educated liberals are more likely to vote with their wallets over brand political stances. Civic Science, a rival survey firm that regularly polls people on a variety of topics, has likewise found the left is more likely to act on political stances than the right, says CEO John Dick. One purpose issue that’s less polarizing than, say, Donald Trump, is brand support of environmental causes or responsibility, which is generally well received, according to Morning Consult. Networking As for the environment at ANA, expect plenty of schmoozing, with much of the action occurring on the sidelines as agencies and other vendors try to woo marketers over private dinners and other events. For those sticking to the formal ANA nighttime agenda, the entertainment includes OneRepublic, which is slated to perform at a Wednesday dinner sponsored by A&E Networks, courtesy of Westwood One. Bush is the entertainment at a Thursday dinner, sponsored by iHeartMedia. Contributing: Jessica Wohl, Adrianne Pasquarelli Web production by Corey Holmes. Photo of Bob Liodice by Clarion Pictures; Illustration by Andrea D’Aquino

What to expect at a more freewheeling-than-usual ANA confab this week

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