Wholesome Marketing Ideas, Bite Size

Wholesome marketing ideas, bite size

Sunday, June 26, 2011

Where are today's Mad Men?

The Mad Men were crazy about consumer packaged goods (CPG). They had the magic to turn a generic flake of corn into a desirable, even aspirational breakfast experience. Packaged goods were easily branded, and brands were easily advertised on television. The CPG industry became the undisputed hotbed of marketing.

Tide, Coca-cola, Heinz, Kellogg and Anheuser-Busch, Wrigley, Mars, and several other food, detergent, alcohol and tobacco companies became the epicenter of brand building activity. Inside those companies, the brand management system was honed, market research was perfected, and consumer behavior was scrutinized.

Not surprising then, that for a long time marketing became synonymous with consumer packaged goods. If a company in consumer durables or technology or financial services wanted marketing expertise on its bench, it hired from the CPG giants. Remember when Apple was run by a former Pepsi guy?

If you’re looking for marketing talent today, would you still hire from P&G, Coca-Cola, or Pepsi?

You could.

Or you could do better.

You see, managers in the Mad Men era managed brands. Their first job title was often “assistant brand manager” and their first love was the brand.

But they managed brands because it was a lot easier then to manage a brand than to manage consumers. The brand was the proxy for a consumer segment. A brand was a neat way of putting consumers into a well-defined group that could be addressed through a common message. Manage the brand, and you’re magically managing large numbers of consumers, driving them into stores to buy your product.

But does that still hold true? Today, its hard to reach large masses of consumers at the same time. 

But the flip side is that you can manage relationships with consumers at a much more fine-grained level. You know so much more about each one of them; you know when they buy, which brand they buy, when they’re likely to buy again, how much they paid, and how much they’re likely to pay, where they shop, and so on.

And if you don't know the answers to these questions, you can learn from industries that do.

It turns out, some industries have a much better handle on the answers to these questions than others. The ones that do, have the following characteristics:
  • Direct contact with the consumer (no intermediaries)
  • Data on every customer transaction
  • Ability to influence each individual consumer independently (not through mass media).

And it is in the more sophisticated companies in these types of industries that you see today’s cutting-edge marketers, and tomorrow’s marketing techniques. Their art resides in understanding and managing consumers through analytics, split testing, ARPU, and CLV; not in terms of GRPs and market share.

Now think about this: CPG companies meet none of the three conditions.

The industries that do meet these conditions are telecoms, insurance, banking, online retail, and online services (e.g. cloud services).

That is where cutting edge marketing is happening today. Not all companies in these industries are with it. Because having the enabling conditions does not mean they are enabled. But these industries as a whole are better equipped for today’s marketing than the CPG business. That's the hotbed of marketing, and that is where today's Mad Men and Women are.


Nishit said...

Goes to show that the value of creativity in marketing is no longer 'the competitive advantage' it used to be during the pre-Internet days.

New Business Hawk said...

great bit of writing there... and that is something to think about!

I would argue that we are just seeing the end of the beginning. The real changes are still to come.

Something I wrote about here!


Kelly Panes said...

An interesting post on the new demands of marketing. Mad Men were such a success originally because they focused on understanding their consumers and emphasizing the enticing features of their products. Suddenly, ordinary products like soap and cereal became exciting and desirable. In the world we live in now, benefits have been presented and exploited for almost any product on the market, and the old method is no longer sufficient to capture buyers. Companies selling products are constantly looking for more information, the next key insight, that will help them better target their consumer. This need for more information creates significant advantages for companies that can easily track and manipulate consumer behaviour data, and creates a huge opportunity for companies who can offer access to large amounts of data and purchasing patterns, such as coalition loyalty programs. Where old marketing techniques are no longer enough, a new industry in the provision of data has been created.