CMO interview: How a portfolio brand strategy and consumer insights help CUB’s marketing chief deliver growth
- 31 October, 2016 12:10
Carlton & United Breweries marketing director, Richard Oppy, says the biggest change to marketing strategy he’s seen over his 15-year career is the client-agency relationship.
“Fifteen years ago, the agency was taking a lot more ownership of strategy, whereas I’m very clear on our marketers owning the brand strategy, knowing what the brand positioning is and identifying the most compelling thing we can tell consumers about our brands,” he tells CMO.
“Too often, marketers go to agencies for everything from strategy through to creative execution. Give the agencies the freedom of a tight brief. Once you’re clear on what you stand for, they can come up with a creative, emotional way to cut through.”
Getting such cut-through also means recognising consumers are bombarded with messages daily and not always thinking about your brand, Oppy says.
“Where there is that window of opportunity for them to be open to your brand, you need to have a simple message that cuts through to smash that open,” he says. “You have to be really clear on what your brand stands for, and when you launch or relaunch it, have that consistent message at every consumer touchpoint.”
Oppy is striving to achieve this through a portfolio strategy that sees each of the alcohol group’s beer brands maintain a distinct identity, target demographic and occasion. For many years, CUB focused on big classic brands that were in decline, he says. At the same time, teams operated in siloes competing for the same consumer, on the same occasion with the same sensory profile.
“It’s not about being a brand for everybody – that is why we have a portfolio strategy,” Oppy says. “Being very clear on our portfolio strategy has allowed each brand to play their individual role, rather than expect too much out of a specific brand in isolation.”
Oppy started his career as an assistant brand manager on CUB’s Victoria Bitter brand. Since then, he’s moved through a range of different brand marketing positions in the group, working in Melbourne and Perth.
A professional milestone was the launch of Carlton Dry in 2006 to grab back market share in the 18-24-year old category. With an executive team wary of a national brand launch, Oppy convinced them to let him trial the new product in Western Australia. Now the biggest beer brand in WA and on track to become the biggest brand in the country over the next three years, Oppy says the key to success was clear positioning.
“It was about targeting young guys and girls that want to live in the now and for today,” he recalls. “It also had the credentials of Carlton, which has been around since 1864, behind it.”
From there, Oppy worked as general manager of the international portfolio, incorporating Corona, Stella Artois, Carlsberg and Asahi, until SAB Miller acquired CUB. He then became GM of Victoria Bitter and Crown Lager. A year later, he relaunched VB back at 4.9 per cent, resulting in five consecutive quarters of growth.
“It was a good way to rally the troops and the business and restore our core brand, having lost our international brands,” Oppy says. “It showed the trade we were focusing on the quality of our products. For consumers that had walked away from the brand because we’d tinkered with it, dropping the alcohol content over the years, it gave them a reason to come back. It also got the business excited that we were heading in the right direction.”
In February 2015, Oppy become group marketing director, replacing Peter McLouglin, who stepped down due to ill health.
Being brave and bold
Since then, Oppy has had his sights squarely set on rejuvenating the beer category by rebalancing CUB’s portfolio of products back into growth categories, while spearheading innovation in white spaces.
“We made some bold and brave decisions to invest appropriately behind our core brands, including VB, Carlton Draught and Carlton Mid, but actually also focus on innovation,” he says.
The first cab off the rank was relaunching Pure Blonde, which entered the market in 2004 as the first to market low carb, full-flavoured premium lager.
“We changed the formula of the beer and made it an ultra-low carb beer, with 80 per cent less carbs than regular beer and 50 per cent less calories than wine, and it’s gone from five years of double-digit decline into 20 per cent year-on-year growth, a 30 percentage point swing,” Oppy says.
Having less calories than wine was also an important message to take to the female demographic. “We have 58 per cent more females drinking Pure Blonde today than 12 months ago, and we’re picking up people from categories outside of beer, which has been a fantastic result,” he says.
On the innovation front, CUB launched Lazy Yak, an easy drinking, pale ale version of its full-flavoured craft beer, Fat Yak, which swiftly became the third biggest craft brand in the country. A highlight of the marketing activity for Oppy was using digital capability in outdoor to adjust creative changing based on weather triggers.
The next product launch was Great Northern, a lower alcohol, more contemporary style of beer. More than 3.5 million cases were sold in the first year, and it’s added more category value than any other alcohol brand, Oppy says.
These three innovations turned CUB’s beer category around and delivered significant sales growth. Importantly for Oppy, three brands also demonstrate the power of distinct identity within a wider portfolio approach.
Up next: How Oppy is ensuring success through product collaboration
Linking marketing to innovation and product development
Innovation for Oppy starts from a powerful consumer insight. To do this, he has CUB’s insights team reporting into the marketing function.
“Too many people see the insights team looking backwards and being reactive and a service to the brand teams to facilitate research,” he comments. “That’s old-school thinking. You need to think of them as the catalysts for future growth.”
Oppy positions CUB’s insights team as the engine for building out macro trends, spying growth opportunities by understanding consumer needs and occasions and finding opportunities the marketing team can feed into its innovation strategy. The innovation team works closely with supply and new product development team to answer that brief.
“We have a number of brewers working daily on what will be those future opportunities, rather than people seeing it as just traditional beer, which it was once upon a time,” he continues. “We’re now going up against all the different alcohol categories, across beer, cider and wine. It means recruiting more females, next generation drinkers, and holding onto the older drinkers moving into wine. We’re changing our profiles a lot and it’s working well for us.”
Arguably, however, the biggest change has been uniting media buying under a group media head, who optimises total media spend across the portfolio, by state, channel and medium, and works with insights on tracking campaigns.
“With the campaigns that aren’t working, we can pull out or we address it if it’s a branding issue,” Oppy says. “For those working well, we’ll redeploy and make them work harder for us. So having a portfolio lens to marketing, rather than a single brand lens, has made a huge difference.”
Similarly, a group head of sponsorship and events ensures every sponsorship is “bang on brand”, Oppy says, while CUB’s digital marketing lead owns social platforms as well as CRM and its consumer database.
“Rather than just rely on agency, I wanted someone in-house, building capability among the brand teams as well as working with agencies in a partnership,” he adds.
All of CUB’s campaigns are tracked against brand recognition and contribution. “Everything gets graded and no one can hide,” Oppy says. “It has changed the way our marketers are thinking. Rather than just do a funny ad, they’re being held accountable in terms of cost per brand and recognition. Putting some data and science behind it has really helped that.”
Oppy is also investigating ways data insight can be tapped for better customer-facing engagement and conversion. One trial is a new CRM program allowing CUB brands to see who consumers are, where they live, and the beers they drink via a click program, much like a mobile app.
“If I know you drink Tooheys New in NSW, I’ll send you a voucher, linked to a point-of-sale system for a Carlton Draught,” Oppy explains. “Once we get the first beer in a consumer’s hand, we have a 56 per cent chance they will buy a second or third time. It’s also often the round they share with their friends.
“It’s direct to consumer and you can see if it’s working or not. Or if you’ve been away from the venue for more than a month, we can send you a message and incentivise you to come back in.”
Balancing mass media with new channels
Across the board, TV campaigns have the highest cut through in terms of brand and recognition, and remain the priority for CUB’s mainstream brands. But digital is definitely a part of the mix.
“It’s about how you complement that, and being clear on the connection moment with a consumer for that brand,” Oppy says. “You’ll never see outdoor on the way to work for VB for example, because of its brand position. It’ll be there on the way home, or you’ll hear it on radio at 3pm or 4pm.
“But Carlton Dry is our youth play, and those consumers are living on multiple devices. So we spend more money on content through digital, online, video on-demand and social.”
As an example of both working together, Oppy points to a campaign for Great Northern. TV ads were used to build awareness and desire and link the brand to outdoor activities such as fishing. CUB extended this content through to its Instagram presence, and also struck a partnership with digital music service, Shazam, allowing consumers to download music used in its ad campaigns and enter a competition to win an outdoor experience to share with mates.
“That went bananas and we got a huge amount of entries, but it was ultimately about people connecting with the Great Northern brand,” Oppy says. “It was mass media, with technology driven to your device to find out more about the Great Northern experience.”
Key attributes to being a successful CMO
Oppy’s first must-have attribute when it comes to being a marketing leader is strategic thinking. “It’s about that ability to understand a consumer insight, understand your consumer needs and motivations better than anyone else, and translate data into insight, into strategy and action,” he says.
Commercial acumen is another. “I’ve always been more of a commercial marketer, and believe building brands that are well positioned with the right media channels will drive top-line growth,” Oppy says. “If you can prove that to the executive team, you can change the conversation in your business.”
Thanks to the hard work done on the portfolio approach and proof of impact on growth, Oppy says funds previously directed into price are going into above-the-line marketing activity and building brands.
“It’s great for the business, because it’s no longer a race to the bottom purely on price,” he says. “You have the facts there, and it’s no longer a conversation about driving brand equity. We can show what we’ve done, the impact on the consumer and how it’s changing behaviour. You can’t argue with that.”
A third attribute CMOs need, Oppy concludes, is the confidence to be strong leaders.
“Too many marketers in the past have been pushed around by their agencies and been led astray, as opposed to having the confidence to own their strategy and brand positioning,” he says. “At the end of the day, when I present to the CEO, I’m accountable. I present brand health metrics every quarter and brand performance and the way we build our brands is so important.”
Richard Oppy joined this year's CMO50 list of Australia's most innovative marketers. You can find out more about what makes his marketing strategy tick here.
Check out more of our in-depth CMO profiles:
- Placing a bet on marketing's customer-led future at Tabcorp
- How innovation and marketing agility are driving growth at Freedom Foods
- 5 learnings from Nestle on modern marketing and communications
- How Guzman Y Gomez is redefining the fast food category through brand purpose
- Transforming consumer brand perceptions of Tip Top
- Why Bupa’s John Moore is all about the experience
- NAB CMO: How marketers can add value to their organisation