An Interview with Nigel Hollis

Nigel Hollis, Executive Vice President and Chief Global Analyst
at Millward Brown, and author of “The Global Brand”

Most brand managers have enough on their plate just trying to make the people in one country happy. Which is why it takes a marketer of unusual ability to figure out how to manage brands across cultures, timezones and national boundaries. And that’s where Nigel Hollis, Executive Vice President & Chief Global Analyst at Millward Brown and four time winner of WPP’s Atticus Award (for original published thinking in marketing services), comes in. His The Global Brand (which we reviewed here) is a thorough, compelling and informative exploration of the subject, drawn from years of experience across different industries and countries. Nigel recently took the occasion of the publication of his new book The Meaningful Brand to discuss some of the observations in The Global Brand about the nature of marketing and the future of global brands themselves.

the paradox

Agency Review:

In the review I talk about how there’s much about the idea of global branding that is actually sort of backwards. One must start with the solution (the brand) and not a problem to fill – when traditionally it’s quite the other way around. That you must reconcile the beliefs of different cultures with each other in some sort of consistent manner – as opposed to honing in on one group whose problem you are telling them you are solving in a particular way. Do you think that’s a fair assessment of the problems and may be why so many brands fail to go global successfully?

Hollis:

That is an interesting way of looking at the basic challenge. Most brands start on the road to going global having achieved success in one country. The logical thing to do is to say, OK, what we have to offer resonated here, where else might it appeal? However, the functional need that the brand fulfills still needs to exist in the new country and people need to be willing to believe your brand can satisfy that need. Look at the example of Kellogg’s entry into India with cold cereals. Indians have a need for a good breakfast just like the rest of us but they believe cold food is a shock to the system. They were not willing to accept that cereal with milk was a good way to satisfy that need. 19 years later and Kellogg’s may be the leader in cold cereal but it is a small category the hot cereal is growing twice as fast.

Agency Review:

Right, but did Kellogg’s go into India because they saw a problem that they could solve, or because they saw a billion mouths? The former is outward-looking (what do they need?) and follows the kind of thinking you outline in “Global Brands”; the latter is inward-looking (what do we do?) and the kind of thinking that I think most brands engage in as they seek to amortize the costs of whatever they do across more and more buyers. So, getting back to your example, how much more cost-effective, efficient, smarter would it have been for Kellogg’s to take your insight about breakfast in India and say “how do we make our cold breakfasts warm, OR should we just lead with our ‘warm’ products (say, Eggo or Pop-Tarts) and build the category that way?” Or am I asking too much from companies?

Hollis:

I suspect Kellogg’s were focused on a breakfast market worth a potential $3 billion. So they looked at the size of the opportunity without asking whether the opportunity was the right one for them. Companies do this all the time. As you suggest, they look at what is in it for us (management and shareholders) not what is in it for them (consumers or customers). I suspect that Kellogg’s thought they could “educate” the Indian consumer and change their behavior. Instead of trying to change the consumer mindset companies need to work with it. A clue to what might have worked for Kellogg’s in India comes from the fact that today the hot cereal category is growing at twice the rate of the cold category. Launching a hot cereal backed by the Kellogg’s name could have been a real winner. Is it too much to ask a company to think about things from a consumer viewpoint? Brands only create value if they provide their consumers with value. Consumers decide what they are willing to pay for so I would suggest it is only smart to think about what they might value.

the fundamentals

Agency Review:

There’s a lot in The Global Brand that is – and I mean this in the most respectful way – very fundamental about brands in any kind of market. Understand your competition. Understand your consumer. Understand your market. In fact, it’s one of the reasons I use it in the global branding class I teach; not only does it show students that the fundamentals apply regardless, but it also assures they actually, you know, know the fundamentals. But was the fundamental nature of global branding surprising to you? And if I’ve characterized it correctly, does this then mean that many brands fail because they simply don’t know – or remember – the fundamentals, and do you find that surprising?

Hollis:

You are completely correct. If you pay attention to the marketing and business fundamentals there is no difference between launching a brand for the first time and launching the same brand into new markets. To be honest, I already knew this before I set out to write the book but interview after interview confirmed my hypothesis.

Agency Review:

Really? Where did this observation come from? And what was the event that made the lightbulb go off for you about it?

Hollis:

I am not sure that a light bulb went off so much as I kept wondering why I kept seeing the same mistakes made. Why did Milka fail to establish itself in the UK? Why did Dove assume that the Campaign for Real Beauty would resonate with the Chinese? Why did Tesco assume that it could change the way Americans shop? Each one made assumptions based on experience in their home territory about what would work in the new one. Cadbury already owned the full cream milk positioning in the UK and Milka could not overcome decades of prior consumer experience. Traditional concepts of beauty and social acceptability still rule in China and so Dove’s message fell flat. Most Americans fill their cars and freezers in order to avoid shopping trips so buying fresh foods every few days at Tesco’s Fresh & Easy stores just did not fit with their established behavior.

Agency Review:

All simple consumer insights…

Hollis:

Most failures appear to stem from companies not taking a consumer-centric viewpoint. They look only at the market as a business opportunity and fail to put themselves in the shoes of the prospective buyer. Why would they buy this brand? Why should they care? What makes it more meaningful and different to the established alternatives?

Agency Review:

That is both comforting and disheartening. Comforting – because it’s always nice to know we were actually, you know, right; Disheartening – because, really?, we still have to remind people of the fundamentals? As someone who works with global companies that ostensibly hire the best and the brightest, why do you think this is? Why do you think these fundamental principals of smart marketing are still lacking? Does it have to do with the way people are being taught? How they’re being compensated? How their companies are being run? And how can we fix it?

Hollis:

I do not think it necessarily has to do with what people are taught but I do think it has a lot to do with business structure and particularly incentives. Even a smart savvy marketer can only do so much when the overriding objective is to sell not satisfy. It is all to do with belief. Look at the companies where the senior management understands the power of branding, a Unilever or a Diageo say, and then the system is aligned to empower marketing initiatives not undermine them. Structure follows strategy. If you incentivize people to sell more, irrespective of margin, you get a very different result than if you incentivize them to create something people want to pay more for

consumer-level

Agency Review:

Recently I was skyping with a student of mine from Turkey and was struck by a strange sort of “global branding parallax” that I was interested in getting your take on. As we talked, I was sipping a Coke, and I suddenly realized that while that Coke meant one thing to me, if she had been, say, in Bangalore, it would mean something completely different to her because of the water-rights issues there; and if she were in Moscow, where Pepsi is #1, it would mean something different again; and if she were in Myanmar, it would mean something different yet again. And I was struck by how – specifically because of the instantaneous nature of the internet – that’s a very different engagement with a global brand than we’ve ever had to deal with (even with the observation that global branding is a fairly recent phenomenon).

Hollis:

This is one of the challenges that I address in my new book, The Meaningful Brand.

Agency Review:

Nice plug…

Hollis:

Thanks. The brand experience of every individual is different. It does not matter whether they live in a different country or just down the street. The marketer cannot hope to address every single person individually (no matter how much they might like to!). Instead they have to focus on creating commonalities, the common brand associations that form the connectivity between individual experiences. I am pretty sure that “happiness” would be a word that both your student and you might associate with Coca-Cola. That association helps make the brand a social currency, one construct that has shared meaning. Ideally a global brand will have some common, motivating concept that acts as the glue to hold the brand together across countries and cultures.

Agency Review:

I don’t disagree with the intention, but we both know that the more specific one can be, the more impactful your message will be. And as a creative, I have to confess that “commonalities” feels like a polite way of saying “lowest common denominator”, which is a death sentence for compelling work. Take “happiness” for instance (and no, I’m not going to go on the record as being against happiness). On the one hand, what does that really mean, anyway? And why is it more ownable by Coke than by, say, Porsche or iTunes or Marmite or Moonpies or anything else? And on the other hand, I’m not so sure “happiness” is something people in India would associate with Coke (e.g., http://www.righttowater.info/ways-to-influence/legal-approaches/case-against-coca-cola-kerala-state-india/). Which raises, I think, the interesting question: Does having a global brand necessarily throw responsibility back onto the company to live up to its promise in ways it might not have had to before? That is, if Coke wants to be about “happiness” for the whole planet, then it has to make it true everywhere on the planet, including India.

Hollis:

Forgive me but not appealing to the “lowest common denominator” is a creative’s excuse for work that appeals only to a limited target audience. It is far more challenging to create content that appeals to the many rather than the few. You might disdain The Beatles, Abba, or Lady Gaga but their work strikes a chord with the masses and has made a lot of money in the process. Most brands need to appeal to mass audiences not niche ones. As to Coca-Cola, it is less an issue that other brands in other categories could claim the same ground and more a matter that Coke claimed the high ground before Pepsi. Before Johnnie Walker did so any whiskey brand could have claimed to represent the idea of “progress.” Too late now.

the next

Agency Review:

You come out of a Western European tradition and I do too, so it’s not particularly surprising that The Global Brand is rife with examples from the US and Europe – Nike, Coke, Nokia, Apple, etc. But the very same forces that are driving those brands to go into Asia and Africa and South America are, or should be, driving brands from those countries to invade Western Europe and the States. Setting aside Japanese brands like Toyota, Sony, and others from the Land of the Rising Sun, what do you think will be the first global brands to come out of the emerging economies, and which countries will they be coming from and why?

Hollis:

I am convinced that the flow of brands from “West” to “East” is going to become more of a two way street. It is all a matter of time. First we had Japan, then Korea. I have to believe that China and India will produce some compelling brands with the ability to travel before too long. There are many challenges to that happening, not least a management mindset that values business and trade over brand building, but it will happen. With that last point in mind, maybe we should be looking South not East for the new global brands? Natura, the Brazilian personal care brand, is a classic example of a brand that has carved out a strong position in its home country and is beginning to expand regionally.

Agency Review:

You make a very good point because it occurs to me that the question was, in a sense, unfair; China’s relation to branding, coming out of decades of state control, is entirely different from India’s which has a legacy of British brands, which is different again from, say, Brazil’s which is wrestling with neither of those things (though has it’s own raft of issues to deal with). But it’s also somewhat unfair because if we’re true to what we believe about products – that they fulfill needs – it requires you and I to look at our own cultures and identify not only what is lacking, but what is lacking in a particular way that some other country’s product can fix. No small feat that. And yet, as we’ve discussed, companies don’t tend to think that way; they tend to think “we’re big; people love us here; where else can people love us?” Natura is an interesting example, but who else? Li Ning? Tata? Anta? Who’s poised to invade?

Hollis:

Tata has the financial clout to invade but it remains to be seen whether they can manage the brands they have acquired effectively. Many other companies have the desire to invade but only a few have the understanding. I chose Natura as an example very deliberately because they are one of the few companies that appear to put people first and business second, of course, by doing so they have created a very successful and profitable business.

the future

Agency Review:

There’s a way to look at global branding as a logical, albeit tricky, evolution of traditional branding. The things you’ve learned, established, practiced in your home market you now try to figure out how to manage in other markets. But once you’re global, what is there? Or said another way, what do you think the future of branding is? More of the same – in other words, maintenance – or something new? And do you think that social media and the internet are that “something new”?; that they, by their very existence, change the nature of branding – damaging it, accelerating it, diluting it, altering it?

Hollis:

First, let me just talk to the social media and internet point. What are these new media channels doing? They are providing new, faster ways of disseminating what used to be called word of mouth. Yes, they cross borders in an instant. So they are accelerating communication of all sorts like never before. But I ask you, is what is being communicated really different? Is the content that people look for and value online different from what they might once have valued in a magazine or in chatting with a friend in the local bar? I would suggest not. People still value interesting and engaging content, something of personal value, and the only real issue with social media and the internet is that brands have forgotten that fact. That’s the real threat of the digital domain, that we get fixated by what we want and can measure easily not what the target audience wants.

Agency Review:

Well, yes and no. Yes, good compelling content is, and always has been, the coin-of-the-realm whether we’re talking about a newspaper ad or a tweet or some other form of advertising that was invented while I wrote that sentence. But I think that people engage with different media in significantly different ways, have different expectations from them and will accept different rules and pitches from them. Or said another way, a website is not a brochure, no matter how many websites were designed like brochures in the mid-90s, and a viral video is not a 30 second spot no matter how much money your agency throws at it. Thus the media impacts the message because the way the consumer interacts with it is different. Now, all that said, I do agree with you that businesses have shown a disappointing predilection where digital is concerned for measuring what’s important to them and not what’s important to their customers – which is troubling whenever it occurs.

Hollis:

I think all you are saying is that marketers need to take into account the mindset and expectations with which the consumer approaches the channel and the content. No, a web site is not the same as a brochure because people expect to navigate the web differently from a paper document. They may be more focused and less tolerant of things they consider irrelevant but I’ll bet that they are looking for the same sort of thing in both media: something of value to them personally.

Tirade over, let’s get back to the real question. Yes, once you are global there is a maintenance job to be done but that is not to imply that it is a small or easy task. Brands must evolve over time as their consumers evolve. The more people understand brands the more they expect from them. Brands have to stay vital, part of the contemporary scene. You do not want to change the essence of what the brand stands for but you do need it to remain relevant and you may need to “level up” to retain a competitive advantage. As the competition catches up with the latest innovation brand managers need to constantly ask what do I need to do to stay ahead?

Agency Review:

I’m not even remotely suggesting that it’s easy, I’m just observing that conquest is an entirely different mindset, structure and probably P&L from maintenance. And I look at a company like Coke which is consumed in every country on the planet except North Korea and Cuba, and wonder what do they do? How do they tell their shareholders – who have been raised on a steady diet of growth for decades – that maintenance is just as tasty? Which in turn gets me wondering if maintenance requires different skills than conquest does. Or, to refer to what we talked about earlier, does it require different fundamentals? And are companies geared toward conquest capable of that shift?

Hollis:

The Coca-Cola Company has a few more strings to its bow than just trademark Coca-Cola. However, I agree with you that there is a shift in attitude required when managing a big established brand, particularly one that is as ubiquitous as Coke. I think the fundamental driver behind the conquest mindset is the belief that volume is the key to growth. If volume growth it no longer an option then you better look at margin growth and make that your key objective. How can you develop your brand to command a higher price premium than before? I have no idea what that means in terms of Coca-Cola but many brands are adding value to their products through adding a service element. Think of Nike+, Zipcar or even Rolls Royce who make money from selling a service package not their engines.

You can read our review of Nigel’s book here, or order it from Amazon here or from Barnes & Noble here – or pick it up at your local bookseller (find one here). Or you can reach out directly to Nigel here.

Illustration of Nigel Hollis by the brilliant Mike Caplanis