Swimming against the tide: brands need to embrace a culture of creativity

“Why is so much of the world-changing innovation going on within entrepreneurial start-ups? Why isn’t there the same level of inquiry, investigation and investment into new ideas within established brands?” asks Rory Sutherland, vice-chairman of WPP’s Ogilvy Group.

These are increasingly important questions as we begin 2012 and businesses face up to a raft of austerity measures and cuts. Marketers must ask why their corporations are missing out on the opportunities afforded to them by thinking creatively.

Companies such as Diageo, Unilever and Merlin Entertainment are calling for creativity to be given renewed weight within businesses. Most organisations have accepted that hard metrics such as data and insight are now crucial to prove return on investment and reduce risk. But to stimulate the economy, top marketers claim that entrepreneurial innovation needs to be top of the agenda this year.

Diageo chief marketing officer Andy Fennell says there is a palpable shift in mood among C-suite executives and boardrooms at what he calls “this crucial time” when the Office for Budget Responsibility has predicted that GDP in the UK will grow at just 0.7% next year.

“There’s a mood of optimism across the developing world and a mood of conservatism in the developed world. It is only leadership and a heightened performance ambition that forces creativity that will reverse that mood of conservatism,” he says. “I delivered a speech recently, entitled ‘The golden era of marketing is ahead, not behind’ which made the point that unless we are bold, that era will happen in Rio, Lagos and Mumbai, not London.”

Fennell contends that most big businesses do not allow the time, resources or culture to benefit from the failures necessary to develop an innovative, entrepreneurial streak. He claims: “To get anywhere near achieving a culture of creativity that can make your business stand out, you need people who are more excited by what is possible than they are scared of looking foolish if they are wrong.”

Success requires people who are human beings first and marketers second to do marketing for people who are human beings first and foremost and not just consumers

At Diageo, Fennell claims that the business has worked hard to develop a culture where a certain level of risk is welcomed in order to stand out as a market leader. He points to the growth of spirits brand Johnnie Walker in the past 15 years. In the 1990s, says Fennell, scotch whisky was flat as a global category and all the data analysis suggested a pruning of investment was necessary.

The Johnnie Walker team, however, convinced the company to look beyond the data. They argued that through being creative and basing the brand’s marketing around the theme of a journey to self-improvement, it was possible to reframe what scotch stood for. The resulting Keep Walking campaign accrued sales of $2.21bn (£1.4bn) over the following eight years and doubled the size of the business, even though Johnnie Walker was already the largest spirits brand in value.

“We believe that creative work scoring ten out of ten will lead to disproportionate financial returns for this business,” says Fennell. “But you can’t get that score every time. At Diageo, we try to make people understand that we will support them when they make mistakes, so that they remain bold in their thinking when they next try something after failing the time before.”

Despite Fennell’s view, a culture of creativity is a hard thing to achieve. For many stakeholders, especially those tied into the relentless routine of quarterly financial reports to the stock market and the culture of short-term success that goes with it, the idea of embracing failure is a non-starter. Neither is the ‘soft’ idea of building internal business processes around human insight or creativity likely to inspire the approval of many FTSE 100 CEOs when they are so focused on the immediate share price. A shift away from that attitude in the business arena would only be possible if changes were adopted elsewhere in society, suggest some.

Former Cadbury and InBev marketer Phil Rumbol, now a founding partner of creative company 101, argues that it is not just the business environment but the whole education system that prevents creativity being given enough weight. He feels that critical reasoning, numerical skills and logic are wrongly given superior billing in schools.

Rumbol points to research studies such as the Torrance Test, a creativity study carried out in 1958 among eight-year-old children who were subsequently monitored throughout their lives. The test introduced the notion of ‘CQ’, creative quotient, alongside IQ, the more familiar intelligence quotient.

Results suggested that of the two, CQ is a better predictor of business success. “If you look at CEOs, there is a good indication that creativity is at the very least a critical component alongside intelligence,” says Rumbol.

“The Torrance Test identified a link between creativity and success. Those that came up with more good ideas during childhood were more likely to grow up to be entrepreneurs, inventors, college presidents, authors, doctors, diplomats and software developers. The correlation to creative accomplishment was more than three times stronger for childhood creativity than childhood IQ.”

The majority of business research at the moment, however, such as the recent IBM survey of 1700 global CMOs, suggests that the chief marketer role needs to become more data-focused at the expense of other skills (see Viewpoint).

“There are many smart, bright, analytical CMOs out there but companies and marketing departments are craving people who can use the data to make the right links to envisage the future, rather than to talk about the past,” says Rumbol.

Creativity, says Rumbol, is about the ability to make lateral, non-linear leaps of faith. He uses the example of the 2007 Cadbury Dairy Milk Gorilla ad that he oversaw before leaving the confectionery company. It was a major contributor to the business, reporting a 5% rise in revenues that year.

“On a superficial level, there was no logic to that advert. It was three times longer than conventional ads, had no message, showed no visuals of the chocolate and made no mention of the product itself. It was seen by many within the company as nonsense,” he admits.

Rumbol spent six months having to explain internally why the “nonsense” ad would work. The brand’s ad agency faced the same battle. Rachel Barrie, strategy director at Fallon, Cadbury’s creative agency, worked on the Gorilla ad alongside Rumbol and she also remembers having to convince sceptics.

“The ad went through two rounds of quantitative research and three rounds of qualitative research, including the Millward Brown Link test, feted as one of the most robust tests of its kind,” she recalls.

“Millward Brown had to recalibrate its own scale to measure how engaging and impactful it was and, ironically for an ad with no mention of the product, it found the work to be incredibly well branded. People knew it was Cadbury straight away. The thing that it failed on was its ‘persuasion test’ but Millward Brown said we should still run the ad.”

Rumbol advises anybody who doubts the power of creativity to read a book called The Design of Business by Roger Martin, which predicts that the next era of competitive advantage will come from intuitive originality rather than analytical mastery.

Marketing leaders pushing for more creativity are not, however, arguing that data should be ignored. Indeed, the relationship between creativity and data is something that creativity advocates are keen to explore.

Unilever’s senior vice-president of marketing Marc Mathieu (see Q&A, below), who left Coca-Cola last March, says that data and insight are essential to help frame the creative opportunity that will eventually become any marketing solution.

The relentless routine of quarterly financial reports to the stock market and the culture of short-term success that goes with it mean the idea of embracing failure is a non-starter…

He talks about building entire marketing platforms on human stories that everybody across the company understands. He says: “You use consumer insight and knowledge of your brand to form a point of view that is creative and ‘spiky’ – that’s what makes you stand out.”

Mathieu points to the work Unilever has done on the Persil detergent brand as an example. “We all talk about differentiation, but if everybody uses the same data then there is no differentiation. Differentiation occurs when somebody decides to try and be creative and say something different.”

For Unilever, something different was not to talk about product benefits in its Persil marketing but relate the washing powder to a creative insight about why people bought it. “What we added to the data for the Persil platform was a human point of view. We said that ‘dirt is good’,” says Mathieu.

The Dirt is Good’ brand positioning reverses all previous washing powder marketing norms, claims Mathieu. In the world of detergents, clean is ‘good’ and dirt is ‘bad’. But he argues that reversing this position to focus on how Persil can help parents deal with the positive, natural consequences of child play – getting dirty – has not only helped the brand stand out but it has required it to look at consumer behaviour in an entirely new way.

“Such an idea requires creativity, not just in the marketing department but across the whole business. It requires a certain humanity to see past what was a conventional and embedded wisdom,” he says.

“Is it more important that my clothes are clean or is it more important that my child plays, grows and is happy? You need this humanity in the way you look at the data to get this kind of reversal.”

Ogilvy’s Sutherland says the creative use of human insight doesn’t get the attention it deserves in many businesses because of a lack of senior or board level roles that are responsible for exploring new ways that creativity can flourish and grow the company. He claims: “No business should be complete without someone at board level with some sort of background in human understanding.”

He notes: “Creative people automatically assume that when you have an idea, you have to present it for assessment and evaluation by rational people. Those people look at your idea and demand proof, cost-benefit analyses and all manner of justification before you’re allowed to go ahead and try it out.

“However, the same principle does not apply in reverse. When rational people come up with a logical argument for a course of action, they do not take it as a given that they must show it to creative people to see if they can improve on it.”

What such ‘rational’ people miss, argues Sutherland, is that enormously successful businesses like McDonald’s, Starbucks, Google and Groupon have all derived from what is often a single human or behavioural insight that may not have initially made for a brilliant business case.

Sutherland and Unilever’s Mathieu propose there should be a creative resource within businesses – a chief ideas officer with board-level accountability to draw competitive advantage from skills that many boards of directors don’t possess in abundance. They argue that for as long as financially trained people operate all the levers of business and define what is value and value creation, opportunities will be missed.

“This doesn’t have to be an agency person, there are clients that could benefit from having a chief creative officer,” says Sutherland. “If you read annual reports, customer understanding and human insight come as a premium.”

To get anywhere near achieving a culture of creativity, you need people who are more excited by what is possible than they are scared of looking foolish if they are wrong

Broadcaster Sky is already active in this area, having appointed Robert Tansey last month to the role of executive director at Sky Creative. The idea of senior creative directors within organisations also has the support of Mark Fisher, chief development officer at Merlin Entertainments, Europe’s largest visitor attraction operator. Fisher has just appointed the company’s first group creative director, former UKTV general manager Paul Moreton.

“Merlin began as a small, fast moving, entrepreneurial and creative company,” says Fisher, who joined alongside CEO Nick Varney in the 1990s. “There was a small group of people that could do whatever they wanted in order to drive the mission.”

Fisher says the company is still built around a lot of those same people, so there is still an entrepreneurial streak in the company, despite it being valued at £2.25bn. This is maintained by a regular, informal exchange of ideas.

“Not many of the big companies are very good at doing it, it’s always the smaller companies,” he admits. “How do we solve this problem? Do we invent new stuff? We try and get every single person in the company to look at things slightly differently and be inventive. It doesn’t have to be the kind of things that you might see on the front of the leaflet or on the advert – it could be anything.”

To successfully incorporate creativity into a business’s daily operations, Fisher cites bravery, an “outsider’s perspective” and time as necessary tools (see How can you develop a ‘creative’ business?). Since these do not seem to be formal qualifications, does this mean anybody can be creative?

“Of course. If you can challenge the convention and make people think in a different way then you can be creative,” he says.

“Some, like [Merlin creative director] Paul Moreton, are better at unlocking [ideas] than other people. But Paul won’t have all the good ideas. A big part of his role is to make sure he can produce ideas in other people, link it all up and make sure it works across the business.”