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Marketing Week: RB Speed To Market

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Marketing Week's cover story provides an insight into RB's Speed to Market competitive advantage

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Marketing Week: RB Speed To Market

  1. 1. May 8 2008 www.marketingweek.co.uk Speed to market Reckitt Benckiser’s winning formula
  2. 2. Cover story Reckitt Benckiser The speed of innovation The Q1 results for cleaning products giant Reckitt Benckiser have beaten all forecasts, but this is not merely a result of the products’ immunity to times of financial peaks and troughs. In an exclusive interview, the RB’s top marketers talk to Louise Jack about the company’s success Dark Knight. R eckitt Benckiser (RB) has only one small consumers do not tend to buy more cleaning mitment to its brands”, Thomas claims. In a cli- request prior to its top UK marketers products during a financial upturn, neither do mate where many are cutting their media spend, embarking on their first-ever interview: they buy less in a slowdown. But Becht has also he adds: “We’re not doing less, we’re doing more.” could we please not use the headline “Reckitt put RB’s success down to a hike in marketing Benckiser Cleans Up”? spend that is paying off “ in spades”. THE NEED FOR SPEED A cursory investigation reveals that the press Stain remover Vanish dominates the laundry The RB formula sounds simple enough: well- has used this particular headline ad infinitum aids market and Finish, the dishwasher deter- researched markets, good product innovation, since the company’s first quarter 2008 results, gent, commands 60% of that £200m market and strong marketing, all creating brand loyalty and just over two weeks ago. To be fair to the head- has consistently rebuffed efforts by Procter & driving up margins. But when Thomas reveals line writers, it is easy to see why The household . Gamble (P&G), Unilever and Henkel to enter the that, at any given time, 40% of revenue comes goods giant reported such forecast-beating results fray. Other brands such as Calgon, Dettol and from products launched in the previous three (net revenues of £1.51 billion, up 20% on the same Airwick have also been in demand. years, one begins to get an idea of the velocity at quarter last year) it raised its full-year targets. RB’s UK marketing director across the house- which it all takes place. While others are wringing their hands, RB – hold and personal care division, Phil Thomas, Thomas has been marketing chief of house- maker of Vanish, Finish, Cillit Bang, Dettol, says that the company made an increase in media hold and personal care for just under a year. Prior Clearasil, Nurofen, Lemsip and Airwick among investment of 29% in quarter one. That, mean- to RB, he was with Procter & Gamble (P&G) for others – is performing above expectations. Chief ing global media spend is a whopping 12.9% of 15 years working primarily on its laundry brands. executive Bart Becht has pointed out that while net revenue, is a “clear indication of RB’s com- He explains how the company manages to 16 : Marketing Week 08.05.08 www.marketingweek.co.uk
  3. 3. Cover story Reckitt Benckiser Part of the small team: who runs the RB business at the agency, adds: Phil Thomas (left) and “Pace is behind everything that RB does, in terms Camillo Pane (right) of innovation and in terms of decision making. You always exit a meeting with a decision and that creates speed. You’re through and out the other side at the speed of light – and then onto the next one.” Southey says that, because RB is one of the UK’s top five advertisers, according to Nielsen Media Research, there is a huge volume of com- munications going through the agency and its group companies. The process has involved a core team being established, in a way that reflects RB’s own structure. Specialist services are drafted in from Euro RSCG’s group companies as and when required, so that a “comprehensive, cohesive approach” can be applied. The agency’s work for RB may not win may creative awards but Southey explains that the strategy behind the executions is based around being clear about what consumers want, then informing them with fresh news in compelling ways. “Like most of these things, the beauty is in the simplicity,” she says. The formula is applied across its healthcare brands too. The company already counted Lem- sip and Gaviscon among its over-the-counter med- icines portfolio but with its £1.93bn takeover of Keeping things clean: Boots’ healthcare operation in February 2006, it Airwick, Finish, And it is not just the senior management that obtained brands including Nurofen, Strepsils Lemsip and Cillit Bang is empowered. Thomas says one of the key dif- and Optrex. are beating sales ferences between RB and other similar compa- Already, innovations to Strepsils and Nuro- forecasts, helped by nies is that brand and marketing managers get fen, with the high-visibility launch of Nurofen the fact that they are to participate in innovation programmes as well Express in July 2007, has seen significant growth products which are as being truly responsible for the top and bottom in the brands acquired from Boots. Pane says not affected during line of their brands. that, for Nurofen, it was simply a matter of giv- economic downturn Thomas maintains this is highly unusual and ing the brand the “RB treatment”. explains in companies of this size, middle man- He explains that Nurofen had seen little or no churn out product innovations faster and often agers normally work on one side or the other innovation in almost a decade. Consumer more cheaply than its competitors: “For a start, and marketers often do not get involved in inno- research revealed the unsurprising insight that we are a flatter organisation than most compa- vation until they have been at a company people want an analgesic to work fast. A new fast- nies. There are simply fewer people to talk to “for years”. acting product was developed and launched with and fewer people to argue with. We don’t have great success, winning over-the-counter medi- endless meetings, because there’s no one to AN ‘ENERGETIC’ APPROACH cine industry awards. have them with.” Camillo Pane, UK general manager of health- Pane says that, despite the limitations that The structure of the company is such that care, is an RB veteran and currently overseeing over-the-counter medicines have in terms of there are only two people between Thomas and the division’s operation while the recently pro- meeting regulations, clinical data and trials, the the chief executive; in the form of his immedi- moted Hanna Novak finds her feet in her new plan is to “accelerate the innovation process time- ate boss, the regional vice-president, who reports role as its marketing director. Pane explains that line” for RB’s healthcare brands. to the head of Europe, who in turn reports “energetic” strategy and innovation forums take Thomas himself displays a sense of duty by directly to Becht. place and says: “We don’t leave unless a decision saying that the company’s competitive edge must “If need be, I can lift the phone and get a has been made and everyone knows what has to not be compromised by long-winded processes, decision from Bart Becht on any given subject be done to launch a specific campaign or inno- slowing the path to market. He concludes: within 24 hours,” says Thomas. In a comparable vation at a particular time.” “Reckitt Benckiser is a vast machine of innova- organisation, Thomas might find five or six RB’s advertising agency Euro RSCG has to tion and it’s beholden to the marketers to main- levels between himself and the chief executive. keep in step with this rhythm too. Sam Southey, tain the same velocity .” � www.marketingweek.co.uk 08.05.08 Marketing Week : 17

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