The Journey of Marketing and Media Effectiveness: Enacting Change In Large Organizations
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Diageo spends over $500m on advertising in the US alone - being able to bring objectivity, logic and analytical rigor into our marketing investments is critical to the success of our business. In this talk, you’ll learn how Diageo tackles marketing and media effectiveness at both the macro and micro level. From allocating spend across brands and geographies, to optimizing in-flight across channels and publishers, Diageo has a suite of tools and ways of working to maximize marketing effectiveness at all levels.
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The Journey of Marketing and Media Effectiveness: Enacting Change In Large Organizations
- 1. The Journey of Marketing and Media Effectiveness: Enacting Change In Large Organizations
- 3. Programmatic Media Mix Brand Mix Market Mix
- 4. Marketing Effectiveness principles Marketing Catalyst: Effectiveness at scale Current and Future implementations 1. Business Purpose 2. Key decision makers 3. How they are made 1. Culture Must Have’s 2. The solution 1. Catalyst limitations 2. Experimentation 3. Programmatic viewpoints
- 5. What is the business purpose of marketing?
- 6. 20181908
- 8. Who makes the decisions on marketing investments?
- 9. Global Executive Committee Annual budget assessment US + Global Exec meeting US CMO and Strategy team Internal Committee Brand Allocation Brand Teams Media Agency Strategic Tactical Operational $2.1bn A&P spend Strategy + Brand overview $600m A&P spend GAME planning Execution Brand plans/Media Mix for the year Execute the Annual plan B-Annual budget assessment Execution and Optimization Media Flows and Projections Continued day- to-day operations Strategy + Analytics
- 10. How are investment decisions being made and why?
- 13. EFFECTIVENESS CULTURE “MUST HAVES” Capability sits with the decision-makers & recommenders Clear, consistent performance metrics everywhere Naturally fits into existing decision-making processes Works everywhere, but not lowest common denominator Positive incentives to apply effectiveness principles Unequivocal C-level buy-in from the outset
- 14. PLACEHOLDER FOR SHORT CUT CATALYST INTRO VIDEO
- 15. Data and Analytics at the forefront Common language across stakeholders Raising the analytical bar 1. Analytical rigor 2. Objectivity 3. Quicker decisions 1. Across markets 2. Across brands 3. Across partners 1. Executive team 2. Brand and Media team 3. Partner Agencies
- 17. TOUGH DECISIONS NO LONGER REQUIRE GUT INSTINCT VS. Smirnoff Sound Collective Social and Digital Display
- 18. LIMITATIONS OF MARKETING CATALYST Timeliness Creative quality is difficult to quantify Lack of granular insights Insights in days/weeks Tease apart campaign and creative effectiveness Deliver off-line sales impact at a publisher/campaign level
- 19. EXPERIMENT #1 - MODELLING AT THE USER-LEVEL Display & Video Price, Promotion, Distribution, Weather, all Other Media WEREN’T taken into consideration
- 20. EXPERIMENT #2 - MODELLING AT THE ZIP-CODE LEVEL • Approach utilizes daily zip code level variation in activities • Granularity Increases statistical validation • Takes into consideration traditional and non-traditional media • Can control for the major non-media factors: • Distribution, Trade, Pricing, Weather Sensor Overview20 Drivers by Activity Sales for each Platform
- 21. FASTER INSIGHTS ARE MEANINGLESS WITHOUT EXECUTION Live Workshops Simple Outputs Longer-term calibration True collaboration
- 22. Marketing Effectiveness principles Marketing Catalyst: Effectiveness at scale Current and Future implementations 1. Business Purpose 2. Key decision makers 3. How they are made 1. Culture Must Have’s 2. The solution 1. Catalyst limitations 2. Experimentation 3. Programmatic’s viewpoints
- 23. PROGRAMMATIC IS GROWING ACROSS ALL MEDIUMS 3.5x $1.6b
- 24. HOWEVER IT’S NOT ALL ROSY… “P&G’s $200 million digital cut were reinvested into areas with “media reach” including television, audio and ecommerce.” “Ad view times were exceedingly short and some people were seeing far too many ads.” “[Consumers] don’t care about good value for advertisers. But they do care when they see their brands being placed next to ads funding terror, or exploiting children.”
- 25. EVERY LARGE ADVERTISER HAS BEEN AFFECTED • Rendered Impressions • Valid Impressions • Bot Impressions • Spoofed and “IFramed” Impressions • Incentive mis-alignment across the board
- 26. WHERE TO POINT THE BLAME?
- 27. HOW AM WE SUPPOSED TO DO PROPER ANALYTICS? $1 10c 10c 10c 10c 50c10c
- 28. PROGRAMMATIC HAS GREAT PROMISE BUT GREATER TRANSPARENCY IS DESPERATELY NEEDED…
- 29. Marketing Effectiveness principles Marketing Catalyst: Effectiveness at scale Current and Future implementations 1. Business Purpose 2. Key decision makers 3. How they are made 1. Culture Must Have’s 2. The solution 1. Catalyst limitations 2. Experimentation 3. Programmatic’s viewpoints
Editor's Notes
- This morning, I’d like to take you through Diageo’s journey to bring rigor, objectivity and analytics to our marketing decisions in both the US and abroad. I lead Analytics and Strategic Planning for Diageo in the US. Diageo is the largest spirits manufacturer in the world– we have over 300 brands that are drunk in 180 countries.
- We’ve got an incredible portfolio of brands, many I’m sure you’re familiar with. There are fun and frivolous brands such as Captain Morgan, indulgent brands like Bailey’s right up to some of the most luxurious brands in the world like Johnnie Walker Blue. As custodians of these brands, many of which have been around for hundreds of years, my job is to enable marketers in both the US and around the world to be able to make sound investment decisions at both the macro level and micro level. I know that many in the room work specifically in the programmatic sphere but in this talk, I’m going to zoom out and look at marketing effectiveness more broadly before zooming to give you an understanding of how we think about programmatic specifically.
- Media Mix – what happens when you star stacking media on-top of each other? When is the best time to flight media to impact sales?
- There are three pre-requisites which I contend a business needs to understand before it can start to seriously build marketing effectiveness principles into all its investment decisions. Firstly, absolute clarity on the business purpose of marketing. Second, absolute clarity of the key decisions on marketing investment which deliver the business objective. AND Third, a deep understanding of how those decisions are made, and how this process can be improved.
- WHAT is the business purpose of marketing? To me, this one should be easy. Marketing exists to create demand for your company’s product. Full stop. It might be demand this week. It might be next month. It might be three years from now. But at some point, any marketing investment must create demand, otherwise it is simply a waste of money. To create this demand, we have to deeply understand our customers and consumers. This is not always a popular message. Some can feel it threatens their creativity. Others that it will make their particular channel look bad. Or that looking at sales automatically equals short termism. I would contend that the opposite is true. I’ve lost count of the number of times I’ve heard an activity described as only being about equity building for the long term, or great excitement about some astronomical number of impressions achieved. These are meaningless statements in isolation. Equity and impressions may be good leading indicators of how particular activities are performing, but they are not the end in and of themselves.
- In today’s world, one of the biggest barriers corporations face to delivering more value from their marketing investment is the sheer plethora of choices that muddy the waters when it comes to clarity on WHAT we are trying to achieve. The arm-wrestle between digital vs. traditional media; between above vs. below the line; between creative vs. media agencies; between ‘shiny new thing’ vs. tried and tested. I have a keen eye for vested interests and I have seen many of them at work in the marketing industry. In an age where ‘data and analytics’ risks becoming a cliché; these interests most often manifest as a proliferation of spurious metrics and so-called KPIs being applied inappropriately to justify dubious investments. Our objective remains, just as it always has been, to create demand today and tomorrow when we invest in marketing.
- Let’s turn to the second area we need to understand. WHO makes the decisions that will deliver our business objective and WHEN in the business cycle do they do it? This is critical to understand for your company, because ultimately the performance outcome from a given marketing programme is entirely based on what we choose to invest in. Once the investment is committed, our capacity to materially shift the sales outcome is usually quite limited. Yes, many of our digital channels – programmatic and social specifically enable much greater inflight optimisation than ever before, but this is missing the bigger picture. - It’s in Facebook’s interest to make that number as high as possible? (Incidentally I’m not picking on FB here – the same could be said of any marketing channel). You have to be able separate the Strategic, from the Tactical, from the Operational. These different sets of decisions together are the primary driver of the performance outcomes of a marketing programme. Therefore to build a marketing effectiveness culture, we have to understand, influence and improve all three.
- This will differ from company to company GAME plans – what are you trying to achieve and how you’re going to do it.
- This doesn’t necessarily mean if you can’t measure it, it doesn’t matter. But in all of our marketing, we need to strive to be able to measure the effectiveness of it otherwise we can’t improve on it.
- Our objective was to build a genuinely sustainable marketing effectiveness capability at Diageo. We wanted to use data and analytics to ensure that every pound, dollar and rupee we were investing in marketing around the world was consistently being spent in the best way possible. This was the beginning of what came to be known as our Marketing Catalyst programme – the centrepiece of which is some fairly cutting edge software. But to only look at the software in isolation is to miss the bigger picture. We started by defining the change we were trying to make, and developed the software to fit around that – NOT the other way around.
- Im proud of how data driven our company has become but it hasn’t always been like this… I’d like to tell you a story of when things weren’t quite as data driven – picture this, it’s the summer of 2010 in Singapore and the global Johnnie Walker team are about to release a new ultra high end Scotch. To create buzz for the launch, the team decide they will charter a 100 ft yacht docking at 8 ports over the course of 3 weeks. The entire brand, packaging and creative teams were invited on the boat leaving only a few spots for potential customers. While this would obviously have been an incredible holiday, this type of lavish expenditure on so called ‘marketing’ has been eradicated.
- Close friend from Australia worked on Smirnoff and was deeply ingrained in the music industry. He created bespoke parties in trend leading locations (Miami, New York, etc) with incredibly hip DJs. They created intimate parties for VIP folks. As you can imagine, these type of parties were expensive to run and weren’t very scalable. < 1000 people had been to the parties in total at the end of the year. While this was undoubtedly a cool, the ROI simply wasn’t there.
- Three tier-system – makes data collection challenging. 96% of alcohol spend continues to be offline
- Work with our analytics partner to simplify the outputs It’s all very well saying to people that we’ve got the ‘right’ answers but it’s been crucial to get people pon-board with brand teams, our analytics vendor, our central media team and our media agency. A lot of people to With Marketing Catalyst…
- There are three pre-requisites which I contend a business needs to understand before it can start to seriously build marketing effectiveness principles into all its investment decisions. Firstly, absolute clarity on the business purpose of marketing. Second, absolute clarity of the key decisions on marketing investment which deliver the business objective. AND Third, a deep understanding of how those decisions are made, and how this process can be improved.
- Noone gets killed with ad-fraud, everyone turns a blind eye. The incentives are all wrong. Publishers are incentivized to buy bot traffic due to everything
- There are three pre-requisites which I contend a business needs to understand before it can start to seriously build marketing effectiveness principles into all its investment decisions. Firstly, absolute clarity on the business purpose of marketing. Second, absolute clarity of the key decisions on marketing investment which deliver the business objective. AND Third, a deep understanding of how those decisions are made, and how this process can be improved.