Time for Mars to return to earth

A cross-country skier may have survived with the aid of a Mars bar, but the firm will need something more to prosper – modern marketing strategies and better product development, for a start. By Marketing Week reporters

SBHD: A cross-country skier may have survived with the aid of a Mars bar, but the firm will need something more to prosper – modern marketing strategies and better product development, for a start. By Marketing Week reporters

In the same week that Mars ended the review of its worldwide agency roster, a cross-country skier managed to survive four days in a Highland snowstorm at -38 degrees Celsius on a single Mars bar. The company seized the opportunity to take a full-page ad in The Sun the next day endorsing the bar’s 60-year proposition that it is not merely a chocolate bar, but a nutritional meal. Other accounts of the man’s survival mention an additional, mystery chocolate bar and two sandwiches, but let’s not be picky.

When the Mars brothers, Forrest and John, announced the worldwide advertising review in January, many in the ad industry were surprised. Bates had been a Mars agency for more than 40 years. Its chairman Rosser Reeves had contributed the immortal phrase “Melts in your mouth, not in your hand” to advertising folklore as a catchline for M&Ms.

Parts of the national press claimed the review was linked to the brothers’ affection for Maurice Saatchi, who left Saatchi & Saatchi plc before Christmas. However, Mars worldwide advertising spokesman John Murray says the decision to begin a review was taken before Maurice’s departure. “The departure provided a good opportunity to begin a full review of all our creative options,” says Murray.

An observer adds: “Forrest and John like to have a single man in charge who they can deal with. When Maurice left, there was a vacuum the plc failed to fill. The only thing they hate more than change, is to deal with an organisation that is out of control.”

But commentators are not far wrong in believing there is more in the agency moves than the petulant whim of two elderly brothers. Mars may pull something radical out of the hat, such as radical change in its marketing strategy.

That said, the results of the review were hardly radical or wide-ranging. D’Arcy Masius Benton & Bowles, a Mars roster agency for 63 years – which created the phrase “A Mars a day helps you work rest and play” in 1959 – kept Mars bar (Milky Way in the US), Whiskas, Twix, Skittles, Uncle Ben’s, Tracker, Dolmio, and added Topic to its roster from Grey. Total billings are estimated at $350m (ú234m).

Grey kept Galaxy and took Pedigree Chum, Kit-e-Kat and Milky Way (Europe) from Bates and Opal Fruits from Saatchi & Saatchi Advertising. Mars’ new roster agency BBDO took only two brands of global significance, Snickers and M&Ms, from Saatchi. It also took premium cat and dogfood brands Sheba and Cesar from Grey and Bounty from DMB&B.

The result reflected anxiety about the sales effectiveness of its existing advertising.

Shortly after the creative review was concluded, Murray said the decision to shift the brands around was to look for “creative freshness”.

Yet the Highland skier episode indicates a more profound malaise at the heart of Mars’ strategy. The company has been accused of clinging to propositions for its brands which are inappropriate to the modern world. The Mars bar, which was launched in the UK in 1932, is still referred to as an energy-providing snack food, rather than a luxury confectionery product. Stranded skiers are a godsend from this point of view – but Nineties consumers are not concerned with energy provision so much as the damaging effects of excessive sugar and cholesterol.

Rather than adapt its products to new health-conscious consumer trends, the company chooses to fight the health lobby head-on, as the Canute-like Simon Bullimore, managing director of Mars UK, did at the ISBA policy conference three weeks ago.

In all its traditional markets, Mars has preferred to cling to unwieldy outmoded marketing strategies, rather than adapt to new market conditions.

However, the company has not always been this way – five or six years ago Mars was very innovative. But Mars’ fingers were burned by a series of highly expensive blunders including a microwave fast-food pizza venture in which consumers did not respond to such technology-led innovations. “Then Mars discovered brand extension and converted to a new religion overnight,” says one observer.

It extended petfood brands such as Pedigree into puppy food. Rice brand Uncle Ben’s became a stir fry and wet sauce brand, and Dolmio was extended into dried pasta. In confectionery the company extended the Mars bar into ice-creams, milk, and most recently its filled chocolate egg, providing repackagings of essentially the same product.

However, this strategy has fallen flat as Mars’ market share in its core geographical market across Europe and the US has been eroded. Pedigree once held a seemingly unassailable position as leader in the petfood market. Though it still has five of the top ten brands of dogfood and four of the top seven catfood brands, key brand Whiskas has lost market share in the catfood sector from, for example, 45 per cent volume in 1989 to 27 per cent in 1994 in the UK. It faces a growing threat from the Dalgety petfood division Spillers following its merger with Quaker’s petfood division in Europe.

The petfood sector has not suffered the onslaught of own-label, but Sainsbury’s is believed to be planning a high-profile sub-brand of petfood as a first foray into the UK market.

Mars’ wet sauce brand leader Dolmio has certainly been hit by own-label, which now has more than 25 per cent volume of the UK market.

As Mars’ core markets were eroded, it sought global expansion. Excess capacity caused by declining sales forced Mars to rush into the emerging markets of eastern Europe, China and the Far East, helped in the Eighties by Saatchi’s global agency network. In countries such as Russia it is still possible to market confectionery successfully as meal substitutes and snack food.

Mars even restructured away from regional management and towards global brand divisions to facilitate the push into these new markets in early 1992. It made the brand managers in the mature markets accountable to worldwide strategic brand leaders and undermined their control and authority.

In fact, the global advertising review has provided camouflage for reviewing operational problems in its traditional areas. Sadly, it has also revealed little willingness to do anything about them.

Rather than expand worldwide sales by committing resources to unpredictable – and expensive – emerging markets, Mars must concentrate more of its efforts on securing its home base when the avalanche arrives. Unlike a cross-country skier, it will need more than a Mars bar to survive.

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