Case Studies of Large Brand Holding Companies Streamlining Their Marketing Teams, Solutions, and Efforts
PepsiCo, Anheuser-Busch InBev, and Procter & Gamble are three examples of large brand holding companies that have successfully or are currently streamlining their marketing teams, solutions, and efforts. Further details are provided below.
- PepsiCo has successfully streamlined the way it measures its marketing return on investment (ROI) and the way it makes marketing decisions.
- It has recently developed ROI Engine, an internal measurement system designed to help the company make better decisions with respect to the measurement of return on investment and campaign effectiveness and the development of a better marketing model.
- Developed in-house and powered by machine learning, this technology plays an important role in the company’s marketing strategy. The company describes it as “a tool that will let it nimbly navigate a fast-changing media landscape” and a tool created to address problems associated with inconsistent and outdated measurement systems.
- The company is currently using ROI Engine to refine its marketing model, but it expects the tool to guide other marketing activities such as in-store activations, go-to-market strategy development, pricing, and product formulations as well in the future.
- ROI Engine has recently informed the company’s decision to devote more resources to streaming and e-commerce. According to Shyam Venugopal, the company’s senior vice president for global media and commercial capabilities, ROI Engine was what enabled them to “confidently shift investments away from linear TV into more addressable mediums,” and ROI Engine was what sped up the company’s foray into e-commerce.
- Venugopal said ROI Engine has enabled the company to approach upfronts differently and scale up its addressable product mix.
- PepsiCo executives said that ROI Engine has increased the company’s marketing efficiency and has helped the company save millions of dollars. Thanks to ROI Engine, PepsiCo no longer has to wait months or a year just to determine if a campaign is effective.
- The company earlier disclosed that it has become “more selective” when it comes to choosing which advertising or marketing campaigns to run. It now focuses on activities or campaigns with greater returns.
- Hugh Johnston, the company’s chief financial officer, also shared that in-housing has improved both the company’s speed and efficiency and has enabled the company to “get the same or more value for less money.”
- AB InBev is in the process of streamlining the way it produces creatives.
- Since 2018, it has been building its in-house creative capabilities. That year, when companies were increasingly shifting to in-house marketing and data-driven marketing and improving their first-party databases, it launched its in-house creative agency DraftLine.
- It made this move presumably to cut overhead costs and address transparency concerns relating to external agency fees.
- DraftLine reportedly uses “data-driven insights to produce creative that is more local and personalized — with greater agility.”
- DraftLine’s initial areas of focus were digital marketing, social media marketing, and the brand Michelob Ultra, but by March 2019, its scope of work had expanded to include 42 brands, analytics, audience segmentation, community management, data collection, digital video, display ads, email marketing, GIFs, influencer marketing, memes, out-of-home ads, packaging, programmatic media buying, radio ads, sign-making, and social listening.
- By March 2019, DraftLine had grown into an in-house agency with 50 employees. And by August 2020, it had grown into an in-house agency with more than 500 employees.
- Improved in-house capabilities have helped AB InBev analyze campaigns and understand customers better. They have enabled the company to have a holistic understanding of customers and campaigns.
- According to WARC, a provider of marketing insights, DraftLine provides alignment that legacy agencies cannot match.
- DraftLine uses the Deltek Workbook to align marketing processes across teams and improve both agility and productivity. The tool provides end-to-end integration of operations and a holistic view of project data.
Procter & Gamble
- Procter & Gamble has successfully streamlined its media planning, creative, and production processes.
- Streamlining began in 2018 when the company announced it would start managing some of its marketing processes.
- In 2019, it overhauled its North American media agency structure, bringing in-house a large portion of its media planning processes. It also brought in-house some creative and production processes.
- It ended its relationship with Wieden+Kennedy, its agency of record for its deodorant brand Secret, and started creating and producing the ads for the brand in-house.
- Marc Pritchard, the company’s chief brand officer, said the company can now complete ad production “for as little as a tenth of the costs and in one month versus five.” He also shared that “Secret sales have consistently grown mid-single digits since in-sourcing [ad production].”
- According to Pritchard, “agency reinvention has saved $1 billion and is leading to more creativity, more agility, greater entrepreneurship and transforming our organization and culture.”
- By December 2019, almost 30% of the company’s media spending was being planned in-house.
- The company is also scaling up its “fixed and flow” agency model, which supplements “a fixed amount of work at a core partner” with work from smaller and more agile agencies.
- The effectiveness of this model can be seen in the company’s co-location with Grey Midwest for the Febreze brand. By co-locating with Grey Midwest and training brand employees on direct-to-consumer performance marketing and lean innovation through competitive challenges, it was able to reduce the time it takes to complete the creative process for Febreze from months to just hours.
Post-Pandemic Challenges Faced by Large Brand Holding Companies
Difficulties with attracting and retaining top talent, the lack of first-party data, and difficulties with workflow management are three challenges that large brand holding companies face as they enter a post-pandemic era where they need to create more marketing content more frequently but for less money.
Difficulties with Attracting and Retaining Top Talent
- As can be seen above, large brand holding companies are bringing some content marketing processes in-house to speed up processes, cut overhead costs, and cope with reduced marketing budgets. Bringing marketing processes in-house, however, is not without challenges.
- The Association of National Advertisers, the Boston Consulting Group, and law firm Reed Smith commissioned a survey of companies with in-house agencies and found that attracting top talent and keeping them energized are the top concerns of in-house agencies as far as developing creative content is concerned.
- Sixty-three percent of survey respondents said keeping talent energized is a concern when making creative content.
- Forty-four percent of survey respondents said attracting top talent is a concern.
- One respondent said: “It’s critical to keep in-house talent energized. Otherwise, attrition can become a real issue.”
- Another respondent said: “When companies choose to leverage only external teams for the higher profile, more public campaigns, the top talent isn’t going to want to come in-house. Any great talent you do have is more likely to burn out and leave for more exciting opportunities.”
- Yet another respondent noted that for mid-level agency executives, “going in-house often requires taking a lower salary and dealing with the monotony of company life.”
- When asked for ways to address this challenge, the survey respondents gave the following suggestions: allowing creative talent to work with multiple brands or internal stakeholders, holding employee showcases or mixers, assigning challenging stretch projects, providing training workshops, inviting partner agencies and external speakers, and celebrating or communicating team successes.
Lack of First-Party Data
- To provide high-quality, personalized content and reduce costs at the same time, large brand holding companies, especially those in the consumer packaged goods (CPG) industry, need to get closer to customers and gather sufficient amounts of first-party data.
- Traditional or legacy business models, however, have made it tricky for CPG companies to collect first-party data.
- According to an article published by Marketing Dive, “CPGs have not typically commanded large amounts of first-party data… because retail partners and platforms like Amazon own the point of sale where consumers share that information.”
- Some companies are addressing this problem by launching direct-to-consumer (D2C) sites and leveraging owned, instead of paid, media experiences.
- For example, PepsiCo recently introduced two D2C sites to gain more control of the point of sale. Kimberly-Clark also disclosed that it is relying less on paid media to accomplish its marketing goals.
- For Josh Blacksmith, the senior director for global relationships and engagement at Kimberly-Clark, it is crucial for them to get their first-party data house in good shape.
- Blacksmith shared that if they could get a consumer to their owned media experience, they would want to close the sale within their owned media experience.
Difficulties with Workflow Management
- Most companies that have brought marketing processes in-house to cut costs say that managing workflows or maintaining process discipline is a struggle.
- Based on a report on trends in creative in-housing, 62% of companies with in-house agencies find the management of the creative process a challenge, and 52% of companies with in-house agencies find project prioritization a challenge.
- Some companies rely on external agencies for strategic ideas and internal agencies for regular production work, but for some companies, the reverse is true.
- In some companies, the in-house agencies and the external agencies are pitted against each other or assessed using different sets of key performance indicators (KPIs).
- According to the World Federation of Advertisers, the organization that commissioned the report, one of the key findings of the report is that there is “the need for clearly defined roles and responsibilities as well as a clarity over scope of work for each agency, in-house and external.”
- Based on a separate survey, 37% of in-house agencies say that maintaining process discipline is a concern.