I am a bit of a book worm. I love the read, the listen or the scroll of information and inspiration they bring to my somewhat aging brain. Always learning!
My latest favourite is Strategy Beyond the Hockey Stick: People, Probability and Big Moves to Beat the Odds by Chris Bradley, Martin Hirt and Sven Smit. A book aimed at CEO’s and upper execs to help them focus their companies beyond the hockey stick presentation. You know the ones, where you go into the boardroom, present your business goals strategies and tactics for the next year or 5 and the sales//profit chart goes down initially as your investment year then an explosion of growth due to how smart you and your team are and how good the execution will be, with these resources. (time, money, unicorns)
So many lessons come out of this book and can apply to more than the C-suite, but marketing people everywhere, particularly those who have multiple brands under their remit, or multiple brands in their organization. I believe so much can be learned that I am starting a series of short articles that talk to the applications for marketing clients that we have experienced, have been privileged to work with or see in the world that reflect practical application of the lessons.
The first is Peanut Butter and Hairy backs. No, this isn’t some weird waxing or skin care regime that will help you through COVID chic, but rather the age old problem of spreading resources too thin across your business and not supporting business units/brands in your portfolio that can benefit from environmental forces and tailwinds that can break out.
On Hairy Backs
Bradley and co. present that most break out plans are presented as hockey sticks, the downward slope of investment years end in explosions of growth beyond. They note that most plans fall apart (92%) and the resulting profit curve is flat to middling, leaving a flat line with shadows of year’s past plans creating what appear as hairy backs on the curve.
On Peanut Butter
Whether you are a crunchy or a smooth type, most folks like their peanut butter spread across the bread, not focused in one corner of the slice. Spreading resources like peanut butter is not that great at a company or brand level, as all you do is dilute your valuable resources.
The marketing story
As a young marketing pup I sat in a group of marketing folks who all had brands and subsequent P&L’s to manage. My personal gang of eclectic brands were a regional mix of mongrels, some punching above their weight, some doing less than they should and others were downright dogs. In the BCG matrix I had a mix of everything. My budgets were small, and to be honest some of the brands didn’t need a budget, despite our poor treatment of our regional brands from afar, but they all generated marketing dollars through their P&L’s and local sales teams would cry for marketing money to support their local brand at retail. I felt obliged to support them, so we did. The peanut butter was thin and well spread. The outcome was small budgets spent in multiple markets and despite my best efforts and marketing plans, a hairy back. Why didn’t I focus all my dollars in one direction? Why didn’t we bring all of those local brands under one and focus our efforts? The answer is another post about social influence across corporations that the boys at McKinsey so rightly point out and I personally have been a victim of.
The opportunity during COVID-19
The truth is we have an opportunity right now to look at our brand portfolios and focus on the brands/business units that will really win either now or when we have budgets again. What are you going to focus on that will cut through? What are you going to focus your agency on to drive market share in categories that you will really win in? Spreading resources (marketing dollars) across different categories when your brand awareness campaign should be focused on one distinctive campaign to drive hearts and minds in your industry/category and then take that brand equity and share of voice and convert it into sales at a category/product level through targeted messaging.
Now is your opportunity to focus your marketing. If you haven’t done the BCG chart on stars, dogs, cows and question marks, you really should, but without it you probably have a good sense of how profitable each of your brands are and how you spend your money driving interest and leads. if you don’t, then sorry you can’t call yourself a marketing person so this isn’t for you. But if you do, you need to take a stand and present resource plans that will return results, not hairy backs.
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