In 1931, a young boss at P&G wrote a memo that came to form the foundation of modern brand management. Here in 2021, everyone working in sales and marketing would be wise to re-read “the McElroy memo”, as the countless digital possibilities present today have blurred views on how to build effective brands and distinctive campaigns.
By 1925, P&G had already created a department for consumer research in order to understand consumer preferences and behaviour. However, McElroy argued that this was not enough. He wanted to move the overall responsibility for brand management from the sales department to the marketing department. According to McElroy, P&G should have a single person responsible for a single brand. This brand manager would be in charge of the brand’s storytelling and take on all brand related activities – from customer and sales analysis, to advertising and packaging design. These ideas would ultimately form the basis for how many companies run their marketing activities to this day.
The memo is relevant for two reasons. First, it contains the important insight that brand responsibility must span the entire value-chain – from customer understanding, to strategy development, to implementation. Second, it reminds us of something that many companies forget in the quest for digital optimisation and quick results: that there is one model that always applies when working with marketing. This model is Diagnosis – Strategy – Tactics, and always in that order.
Many marketing leaders are absorbed by the numerous digital possibilities of today and try to find fast solutions – solutions that may be based on the motto, “we can simply change it because it’s digital”. New channels, platforms and solutions blend together in a mass offering, the “free” SoMe-channels are always at hand, and you can feel the need to take a position on everything that is available at all times. Shouldn’t we be on TikTik? What do we do with AI? And what about Salesforce – are we doing enough with it? It therefore becomes easy to take action based on “quick” marketing possibilities, rather than what creates value for and relationships with the customer.
It doesn’t take a long time to write some content-articles or film a rough campaign that can be released in record time. But sooner or later you have to look at the sales numbers. As an advertising professional who has tried almost everything, it’s my experience that you should stop trying to “go” before knowing where you want to go – and that you should resist the temptation to take shortcuts in hope of achieving fast results. As the legendary copywriter David Abbott said, “Shit that arrives at the speed of light is still shit”.
There is no miraculous shortcut to success in marketing. Good marketing always begins with the customers’ needs. It is here you must start in order to create lasting success, and it is here the three steps McElroy pointed to almost 100 years ago still work. You still carry out a diagnosis, then create a strategy, and – in the end – think tactically.
Formulating an effective diagnosis is a three-part process. You begin by using your knowledge of your brand or product to develop a hypothesis regarding which problem you can solve for the target group, or what needs you can fulfil. Next, you test your hypothesis by speaking with people who love the brand. They will explain what they like and what can be better. Lastly, you use qualitative research to evaluate how many people experience the problem or have the need you want to address (research can be expensive and difficult, but the alternative of going with gut-feeling is even more expensive, as it rarely pays off). This three-part approach yields a diagnosis that allows you to understand how customers act and do not act – and why.
After the diagnosis, you can proceed to creating the marketing strategy. Ask yourself, how should the brand be positioned? Which target groups should you pursue? And in what order should you execute each element of the plan (including KPIs)? Remember, your customers see several hundred marketing messages every day, so the strategy cannot be too generic (boring), and the campaign’s design must be distinct. Everyone knows that these types of campaigns are difficult to create, but in my experience, it’s even more difficult getting brands to buy them. This may be why we see so many easy, indifferent campaigns – even though we know studies show that creative campaigns function best.
It requires bravery to choose a solution that people can relate to. And if you have second thoughts, you can always revisit the diagnosis.
When you know deep down that you’re on to something, which is important for the customers, it’s easier to find the courage you need. It’s not the end of the world if someone has something against your marketing – but it is if no one notices it.Mikkel Heideby, Partner, Sunrise
Only after the diagnosis and strategy are in place should you begin to look at the tactical elements. What is the most effective way to reach the customers? How do you get the most possible return out of your marketing investment? What role should the website play? How many seconds should the film be? What should a click cost?
If your company carries out marketing efforts based on these three steps, and in the aforementioned order, you can be quite certain that the results will be relevant, desirable and effective. And after receiving such results, it’s only appropriate to take out a good bottle of wine and send a kind thought to blessed Neil McElroy.