The AANA CEO caught up with B&T to discuss what he learned from its annual RESET for Growth conference this year and the challenges that marketers face in the current economic climate.
Lead image: The AANA’s CEO Josh Faulks
Marketers are doing it tough at the moment. Many are under pressure to drive growth at a time when marketing budgets are under pressure, the costs of doing business are soaring, and many Aussies are tightening their purse strings as the cost of living crisis suffocates consumer confidence.
This year’s AANA’s RESET for Growth conference explored ways in which marketers can drive growth in this challenging economic reality.
Almost all of the sessions that B&T attended showed how major brands and their senior marketers are finding creative and effective ways to drive growth across earned, owned, shared and paid media, and how this is driving top line performance.
AANA CEO Josh Faulks told B&T the challenge that many senior marketers (although not all) face is how to grow their businesses at a time when there have been significant increases in the costs of doing business (such hikes in raw materials and transport costs).
without passing on these costs to consumers, because that will have a knock on effect on the demand for business and inflation.
“When it comes to a lot of FMCGs and other businesses in Australia, the two particular challenges are flat growth – because of low consumer confidence and inflation, and there is a significant increase in the cost of doing business, sometimes we re talking a 30 per cent increase in the cost of raw materials,” he said. “This is an unprecedented challenge that they’ve never seen before.
“So if you’ve got a flat top line, because consumer confidence is down or not that strong and consumer spending is flat, and you’ve got rising costs of doing business, it’s squeezing margins and increasing the scrutiny and pressure from finance teams and the CFO to cut costs across the board.
He added: “What I keep saying is that if you cut costs in marketing, you’re not going to be able to achieve that growth. We need to articulate the value of investing in marketing. The research is clear that those brands that invest in marketing during tough times or economic downturns have performed significantly better than their competitors in the recovery.”
A RESET of Target Audiences
One area that marketers should reconsider is who their target audiences are and whether they need to focus on older demographics that are traditionally ignored for younger cohorts.
Author and futurist Bernard Salt made this point in a context-setting presentation to kick off RESET this year.
Compared to many other OECD countries, Australia has many advantages of being one of the richest nations, with a fast-growing and multicultural population.
“He’s challenged marketers and businesses to say ‘is the traditional way that you’re segmenting and targeting customers the right way to do it at the moment?’” Faulks said.
“You need to look at what the shifting sands are when it comes to our demographics.
“The interesting stuff there is about baby boomers and those people that don’t have mortgages but often do have deeper pockets. The challenge is traditionally everyone says ‘let’s go for the young 18 to 24 year olds, but is it better for businesses to start thinking about some of these other really important demographics that have had a lot of money and a lot less responsibilities?”
Faulks said he aims to bring the industry together to promote the value of marketing as a driver of growth and profitability.
When reflecting on this year’s RESET, here are his five takeaways:
- Have marketing in the cockpit: If you want to grow and you want to drive profitability, then you need to invest in marketing and have marketing in the cockpit. That’s a message that we’re trying to say to business leaders, that marketing is not a cost centre, it’s an investment to help your business grow.
- Creativity drives growth: This came through in the sessions on Lego, Barbie and AB InBev. In Richard’s presentation, businesses that market with creativity and operate with creativity achieved three times the results of those that don’t. His presentation show they topped Cannes Lions and the Effies two years in a row as well as WARC’s top advertiser. And then he went and showed really clear graphs about how creativity achieved rockstar growth revenue for them.
- The power of partnerships: If you look at the CommBank Matildas, Barbie and Lego, all of them talked strongly about the power of partnerships and how it helped them grow. I liked that it showed the difference between real fandom and paid influencers, and how that fandom creates loyalty. Where they got the most value was around earned, shared and owned media. I thought that was a really good insight on how you can mobilise your partnerships and fans to create an ecosystem of earned, owned and shared content, it just goes so much further than just paid advertising and media.
- Take a risk and embrace failure. I don’t think Australia does failure very well. We’re not that kind of culture. But there is that old concept about fortune favours the brave, and you see the entrepreneurs come through who take a risk, embrace the failure when it doesn’t work, take the learnings and move on. That happens a lot more in cultures like the US and Nic Taylor was very clear about this in her experience at Lego. In Australia, I think we’re a little bit less tolerant of failure and we need to shift away from that and embrace that culture where it is ok to fail, learn, move on.
- Dream big. I’d like to see more marketers dream big and have an unwavering belief in focusing on Northstar, which is what Richard spoke about. In Australia, we also tend to talk ourselves down a little bit, and we need to be more optimistic about the future and the outlook. It would be great to try and build more of that optimism and big dreaming mindset in the industry.
B&T’s coverage of RESET for Growth 2024
- How the Matildas helped CommBank become a ‘globally iconic brand’
- Marketing from the cockpit: how creativity transformed AB InBev a brand buyer to a brand-building powerhouse
- Bernard Salt on why the best is yet to come for the Aussie ad industry
- Warner Bros Josh Goldstine on Margot Robbie, Barbie and marketing
