In this series on managing the digital revolution, Ari Aronson and Stephan Argent collect insights from both the agency and the brand sides of the street.
This week, Marketing contributor Stephan Argent chats with Vikram Bawa, vice-president marketing at McCain Foods Canada, to get an idea how the company is navigating its way through the digital marketing revolution.
What’s your vision for the future of digital in your organization?
I’m putting my money where my mouth is – looking at digital as a key driver in our business. At the same time, traditional TV is important and you can’t just walk away from it. It does have a role to play, but having said that, if I look at the future, our future consumers are the millennials and they are not consuming traditional media. They’re consuming a very different kind of media, which is in the social and digital landscape and demands a more a customized conversation.
So going forward, my intention is to develop the capabilities of our marketing organization and leverage that platform a lot more fully than we have in the past.
The one area I’m still trying to understand is where mobile fits into the digital landscape. I think it’s a very important, emerging vehicle within the digital ecosystem. And we have a lot of millennials in our organization and on our marketing team, so I really want to leverage them and their understanding as consumers and how they consume media and bring that into our organization to enhance our capabilities.
What areas of digital do you do in-house vs. outsource, and why?
Right now we only have two people on the digital side who are leading our strategy, everything else is outsourced. For me it’s about building relationships with companies like Facebook, Twitter and Yahoo, and starting to have conversations with them directly for them to get to know us, and for us to get to know them, and to see how we can build those relationships going forward.
Do you use a one-stop agency or split out digital separately, and why?
One stop. We didn’t have the capabilities internally and we didn’t have an agency dedicated to digital previously, so this is our first foray into bringing an expert agency like Grip on board to drive digital, and then look at how our spend and strategy goes this year, then evaluate at the end of the financial year to see what we need to change, what do we need to do differently to build our strength and capabilities in the digital area.
How has digital impacted your marketing org chart?
Not much, but the focus of our team has changed. I’m stretching our team. Now we’re up to 35% of total [marketing] spend [on digital] and their scope has increased dramatically and that’s why I’m looking at making sure our marketers are coming to the table with enough experience and capability. In our last three monthly marketing meetings, a good chunk of those meetings have been given to people from outside [the company] whether it’s Twitter, Facebook or mobile, and getting them to talk about the business to help open minds and understanding of the digital landscape.
What are the biggest challenges you’re facing from a digital perspective?
Most digital agencies don’t truly understand mobile to the extent I’d like them to. I think there’s an opportunity for them to be better versed in mobile and the future of mobile. A lot of the stuff we talk about is about trial and experimentation. I would like to see them much more advanced in their thinking and be driving that thought leadership. When you look at mobile and mobile usage today, agencies and brand manufacturers aren’t moving fast enough and retailers are not even close. We still don’t have a lot of mobile couponing, we still don’t have a lot of cross marketing/cross promotional initiatives with retailers and mobile. We’re still using a lot of traditional mobile flyers. We’re not customizing offers based on consumers and digital devices their using.
What are the key expectations from your brand team and digital partner?
I need them to rise to the occasion and really show me a return on my investment. If I don’t see a return on investment, I won’t be able to convince the organization this is the right way to go and it will be very easy for the rest of our stakeholders to say it didn’t work. Our agencies know what the stake his here, our marketers internally know how critical this is and I make no bones about it. Yes, we’re still struggling how to measure our ROI and trying to find the right measure and that’s why I’m big on mobile — I can connect those activities to sales. Right now, ROI is a brand metric because I’m making such a huge shift in digital from the past. From brand metrics, equity and sales, I’ll be able to see whether that change has made a positive impact or not. But going into the following year, where digital will have a strong base to work off, I will struggle to figure out the right ROI. I’ve a year to figure that out!
How do you decide to allocate budget between traditional and digital?
One of the things the team did before I arrived was marketing mix modeling based on our existing spend. Then when I came in, I asked them to look at a couple different scenarios with different spends on digital and shopper marketing. They have modeled that to drive some of the internal investment and used it as a starting point. We looked at 25% as a bare minimum threshold and the projected results were quite dramatic. Then it was increased to 50% when they looked at traditional versus digital, so 35% is not a magic number. We used that as a process to put some numbers on the table.
How can agencies be more effective to you and other marketers in their digital solutions?
What I’ve found is that Grip has been very open to feedback and open to being challenged. Right off the bat I told them that’s how I liked to engage. It’s been a good conversation and a good two-way relationships so far. The proof will be in the final execution and the monitoring of the metrics.
Stephan Argent is president at The Argedia Group, an agency management consultancy.
