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Jim Stengel spent seven years as the global marketing officer at Procter & Gamble and is largely credited for transforming P&G into one of the most admired brand-building companies in the world. He is now president of Jim Stengel, LLC, a think tank and a consultancy that focuses on proprietary research and ways to drive business growth in the current economy. He is also a director of the Motorola Corporation and serves on the Board of Advisors for MarketShare Partners, a marketing analytics firm.
His new book 'Packaged Good', which is set to come out next year, examines the role that purpose driven marketing plays in growing market share for brands.
This week, he was appointed as an adjunct marketing professor at UCLA's Anderson School of Management. Starting next January, he will teach brand marketing to graduate students at the university.
Econsultancy caught up with the marketing guru to see what his plans are at UCLA and what role purpose driven marketing can play in a downturn.
What do you plan to bring to UCLA students?
What I'm trying to do is be much more collaborative between students, faculty and my company. I'm approaching teaching as an academic and a practitioner. It's going to be very much two way. What better group to be talking about reframing the future of marketing with than the next generation of leaders?
I did a case competition this Spring at the school. 22 teams competed to be in the finals. Eight teams were chosen to design a marketing plan for my book. I gave a cash prize to the top three teams, and I will use a lot of their ideas in the marketing and pre-marketing of the book. I've learned a lot from the students at UCLA. I've even hired a full-time intern for the Summer out of the MBA program.
Why did you decide to leave P&G?
I was the head of marketing there for seven years. I always wanted to do something different before it was too late. I was inspired by all these ideas I was talking about and I had accomplished everything that I wanted to do when I came into that role.
The signal to me was when we won the big award as marketer of the year at Cannes. P&G is a company that was not always known for its creativity. And I realized that was the time to pursue my other dreams. I wanted to write and think and teach and consult and speak. I'm doing all of that and it's really fun.
There's a recent study that says only 13-15% of Fortune 1000 companies have marketing chiefs. Is the role of CMO becoming obsolete?
I would challenge those numbers. A lot of different companies title the role differently, but it's still there. The problem is if you go into 20 companies and you ask them what matters in marketing — what are people rewarded for, their criteria for success, how that leads to a competitive advantage — you will find very different answers to all those questions. You don't find that in R&D or finance. Why is that? Is there something that we could do to elevate perforrmance by highlitghitng the things that great brands do to create great marketing? That's what I'm looking into with my book.
We're playing below where we should be playing. The more we can measure what drives value behind the brand in similar ways, the more we can ensure that the discipline will get better and we'll have healthier brands. What counts in marketing across companies is really varied. Because of that, we have not as an industry built brands with the trust and consumer engagement that we could. But there's a huge opportunity there, and that's the mission I'm on.
Is the marketing industry in trouble?
Look at what's going on around us. The state of brand trust is terrible. Very few marketers are working on ideas that have a chance of simplifiying and improving people's lives. Very few are chasing the right objectives.
I just conducted a study with UCLA and Milward Brown to look at brands that have made a big impact on consumers' lives and financial performance over a long period of time. I'm building on that idea in my book, by trying to help people who lead marketing take performance to a different level.
How can brands focus on purpose driven marketing in a downturn? Should they just focus on cost in a recession?
I don't think it's an either/or. In a recession it's easy to get distracted and get away from what you stand for. That doesn't mean you ignore price. But if all you're about is communicating a price comparison, you've lost it.
It's always importnant to act in a manner consistent with what you stand for as a brand. The brands that are popping through in this study are ideals oriented, mission oriented and purpose driven.
Which brands are performing well?
The brand that's used over and over again is Apple. It's a highly ideals driven organization. Google as well. They've slowed down but they're still delivering the numbers. It's a relentless organization that is extremely true to its purpose.
What about non-tech companies?
One brand that's really done beaufitully in the packaged goods arena is Red Bull. Everything they do, from the conception of the brand to their marketing communication and the events they sponseor, it all comes out of the brand ideal. It's been a huge success, and the company continues even through this recession to bring in good numbers. Target has also been interesting to watch through this recession. They've been challenged by Walmart, but they've focused on what makes them different and special, and I'm convinced they'll come out of this stronger.
What about luxury brands? How do you sell expensive products when people are increasingly budget conscious?
Even some luxury brands are delivering good results versus their category. Some units of LVMH are still hanging in there. For more expensive products, you just have to focus on the value, the meaning, the authenticity and the timelessness of the product. They also have to focus on the tremendous quality and make sure the experience is wonderful in the store and online. Those brands that do so will get through this. It's a great time to reaffirm what you're about and stay true.