Brands are having to shift their strategy to place their purpose at their core, even more … [+]
ANA
We know from Barkley research that modern consumers trade up and down. They trade up to strong brands paying a modest premium for brands they prefer and at the same time they trade down to private label to save money if they either don’t see brand differentiation or they view the category as a commodity.
Brands are having to shift their strategy to place their purpose at their core, even more aggressively with the pandemic. In an effort to learn more about how mature brands are effectively integrating purpose & sustainability into their core strategy, I interviewed the Association of National Advertisers CEO, Bob Liodice.
Jeff Fromm: How is purpose shifting to the core of brand strategy?
Bob Liodice: It’s amazing how purpose has come from almost nothing, a few years ago and is now a foundation for what a brand needs to think about. I think that the discovery process has been gradual, but accelerating ever since COVID started and even more so, with all of the racial and social injustice issues that we had following the George Floyd tragedy.
What the ANA learned especially through COVID, as we chatted with a number of our chief marketing officer friends and colleagues was that brands need to be authentic. They need to be able to be in a position to create great relationships with their consumers. Consumers are not interested in relationships that are either commercial or transactional in nature. They are desirous of relationships – and with COVID — it was a recognition that consumers have a high degree of anxiety right now.
Anxiety is created, as a function of their own health and wellbeing, through their own financial situations which may have been impacted. Brands have found a degree of enhanced relationships with consumers by acknowledging the fact that they were just there for them.
It was during those times that brands changed course very rapidly and they attempted to really be there; not just in words, but in demonstrable actions. They saw that manufacturing facilities were converted from producing products, to one where they’re actually producing ventilators, masks or hand sanitizer. And, also, to find different ways of creating those relationships like Anheuser-Busch. They created virtual bars where people could congregate, share stories and kind of hang out as they’re having a cocktail or a beer at home.
What’s starting to happen is this is snowballing to the acknowledgement that there’s not only this enhanced relationship directly with the consumer, but with what brands can in fact do for society in a more holistic and wholesome way.
Fromm: How important do you think sustainability is to a holistic purpose strategy?
Liodice: Usefulness is one key to making a difference.
Everybody has attempted to jump onto the climate bandwagon and understandably so, but the extension is probably closer to home. That was essentially exacerbated by the George Floyd tragedy which ignited the concerns over racial and social injustice. And it brought it home to roost because this is an area where too many brands have probably given more lip service and consumers demand tangible actions to move this conversation forward.
If you look at the diversity scorecards that companies are putting together and that we have put together through the ANA, we see improvements in gender, but not as much so in multicultural arenas, where leadership of many marketers at the CMOs suite, has been below what’s required.
By the ANA’s latest count over the last three years that we’ve done survey work, there’s only about 12% of the CMO community that is from multicultural ranks and which is relatively minuscule relative to the fact that, 40% of a demography in the US is multicultural and rising at rapid rate.
The confluence of the societal unrest with the acknowledgement that the entire marketing community hasn’t lived up to its commitments, is essentially repositioning brands to rethink relationships on that front. You see more of an outreach that recognizes that there is an unconscious bias and we can measure that now through the use of both the gender equality measure that we use for our See Her efforts, as well as our cultural impact measure that we use for our multicultural efforts. When you remove unconscious bias in your ads your brands perform better and your consumers react better and the two are inextricably intertwined In that respect, brands have the opportunity to make better progress by recognizing those differences and bridging those gaps. I think you’re seeing a better response to that, especially since the George Floyd incident.
Fromm: What is the right role for marketing to play in driving sustainability and particularly the UN Sustainable Development Goals)?
Liodice: There is certainly a great degree of progress that needs to be made across a number of fronts. I think that there is a natural tendency to recognize that we still need to be able to see that we are making progress.
Obviously the UN is very much involved, it’s integral to what they fundamentally believe needs to take place in the US and around the world. But brands, no doubt, can contribute to that direction by embracing common standards like the UN goals.
I see a lot of companies articulating their desire to use stretch goals to be able to make those changes and many have said and articulated goals of a carbon neutral footprint by sometime in the future. I think Amazon was one that basically said, “We don’t know how to get there, but it is our commitment to at least make the attempt and to figure out how to get from point A to point B in that timeframe.” Many brands and companies have identified this as a corporate strategy, but I think that there is much to be desired in terms of how brands are eventually going to close that gap.
For questions about this interview please contact Jeff at [email protected]
