How I Built This with Guy Raz - BONUS: Brand Building Live at Cannes Lions

Episode Date: July 26, 2024

What does it take to successfully market a brand today? Last month, Guy sat down with marketing expert Jim Stengel to find out.Jim spent more than two decades at Procter & Gamble, where he managed international brands like Jif and Pampers. He spent seven years as P&G’s Global Marketing Officer.Today, he consults with businesses large and small, and interviews marketing leaders on his show, The CMO Podcast.This interview was recorded in front of a live audience on the Amazon stage at Cannes Lions International Festival of Creativity, and was supported by Wondery.This episode was produced by John Isabella with music by Sam Paulson. It was edited by Neva Grant. Our audio engineers were Cena Loffredo and Debbie Daughtry. You can follow HIBT on X & Instagram, and email us at [e-mail]. And sign up for Guy’s free newsletter at guyraz.com.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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It had tall windows, beautiful old details, and plenty of space for all of us. And being in that home on Airbnb, right in the middle of Vienna, walking distance from so much of the city, made it feel less like a visit and more like we were actually living there. Plus, taking a trip is the perfect time to host your space on Airbnb. Your place with all of its personal touches and its amazing location could make someone else's vacation even better. Your home might be worth more than you think. Find out how much at Airbnb.ca.com slash host. Hello and welcome to a special bonus episode of How I Built This. I'm Guy Raz. So last month, I had the chance to attend the Cannes International Festival of Creativity,

which brings together marketing and advertising professionals and creatives from all over the world. While I was there, I was able to sit down with Jim Stangle, who's one of the most seasoned and knowledgeable brand builders out there. Jim spent more than 25 years at Procter & Gamble, where he eventually served as its global marketing officer. He basically helped establish P&G as one of the world's leading brand builders. Now, today, Jim runs his own consulting firm where he works with a bunch of different leading brands. And he also has his own podcast. It's a show, not surprisingly, about branding and marketing. Our conversation was recorded in front of a live audience at Amazon stage at Cannes and was supported by Wondery.

And it was filled with insights on what it takes to build a world-class brand today. So I hope you enjoy listening as much as I enjoyed being there. And let's get on to the show. So Jim, welcome. It's great to have you. And thank you everybody for joining us. Jim, let me start by asking you about P&G. From what I've read, you were actually rejected as an intern, right?

Like you tried to get into PNG pretty early on, and you didn't get in. That's good homework, guy. That's nowhere on the Internet to be found, by the way. No, I didn't not get in as an intern. But I was sort of relentless. I had a great counselor at Penn State where I was in school, who was an advocate. And I went for the interview. You had to have a unanimous vote.

and I remember the smoky rooms interviewing behind closed doors, doing case studies, and then they made a job offer to me. The guy pulled a bag of cookies out of his desk and he said, this is a secret, no one knows about it, you can come here and work on it. Wow. All right, so you eventually get into PNG as sort of a trainee early on, very junior, and one of the first products that you work on, and this is really interesting. It's much more interesting than it sounds was Duncan Hines cookies. P&G owned Duncan Hines at the time.

They don't own food brands anymore today. But your job was to introduce this brand to America. Why was it special? Why was it a different product at the time? Well, Duncan Hines was a brand that had cake mixes primarily and brandy mixes. This was a baked cookie, a ready-to-serve cookie, if you will. So we were taking on Nabisco and Keebler and Frito-Lay, and we thought we had a better product. Yeah.

And it was crispy in the outside, soft on the inside. We spent a lot of money in advertising and sampling. We put it in test market, got to a 25 share, and then decided to go national. What's interesting about it at the time was that the cookies that you bought at the grocery store, this is in the early 80s, they were like hard crispy cookies. Here you had, it was designed to taste like a fresh-baked cookie. Correct. And it did.

Yeah. And you had basically a budget to get this in the hands of every person in the United States. Yeah, I was a kid. I mean, it was 28 years old. I came into PNG and they said, here's $60 million. We want you to put this cookie in the hands of every person in America over the summer. So I had to work with the post office, refrigerated truck companies and design a program where every person in America tried them. And how did they do? I mean, your biggest competitor at the time was like Keebler, right? They were doing soft batch cookies. I remember those as a kid. I loved all the, any cookie I get my hands on. How did you do against your competitors? You know, we got off to a really fast start. We built out a national expansion. We built a factory. And we expanded.

And honestly, we were crushed guy. It was my first big failure at P&G. We underestimated our competition. And we underestimated the consumer's desire for massive variety in cookies. And we had like five flavors of chocolate chip. So we ended up exiting the business. And we just, it was not our specialty. thinking we could come in there

and these established baking companies and take away 25 share, forget it. Yeah. You've written a few books and one of the things that you write about is something that you really got into early in your career, which was immersion research and we're going to talk a little bit more about this over the course of our conversation

because I think it's critical. And one of the first places that you sort of tried this out was with peanut butter. You were assigned Jif. Jif peanut butter. Assistant brand manager. And so tell me what you did. How did you learn about consumer behavior at that time?

This is like 1985, 86. Well, we were kind of pioneers within P&G. We kind of had a staff meeting and we said, you know, if we just try to sell peanut butter, we're going to trade share with Peter Pan and Skippy, remember them. And so we said, we've got to go deeper, and we've got to be sort of a parenting advocate. And we've got to talk about nutrition and lunches.

And we have to think about other flavors and make it even more nutritional. We have to talk to our farmers. So we did a lot of immersive research. Did you actually spend time with, like, parents, moms in particular? We spent time with moms, who spend time with teachers. What were you asking them? What's important in their life?

And how can we help? Not what do you want in your peanut butter? No. And you know what we heard, you would hear today education, our schools. So we formed an alliance with parent-teacher organizations around the country, and we aligned our sales with funds that we would give them to improve their schools. and it was a massively successful program. And at the time, I think right before, Jif had a slogan,

and it was something kind of, you know, not particularly exciting. It was like Jif peanut butter is healthy or something like that, right? But they had had another slogan, choosy mothers choose Jif, and they dropped that. But essentially you said, let's bring that back. We brought it back. Do you want me to sing the jingle? Yeah, sing the jingle.

No, no. There was no jingle. It was a declarative statement. No, we brought it back. says, and they ran with that for decades. And what happened? I mean, what happened? I mean, was, I'm assuming, Skippy, Peter Pan, or the competitors, you've got GIF and this campaign.

What was the result? Well, Guy, I mean, we still made a better product. I mean, that's a very P&G value. You always want to have a demonstrably better product than your competitive set. So we still have a great product. But we thought if we could align with their values, and if we could help in things that mothers and fathers and parents care about, we would have higher awareness, higher loyalty, and a stronger brand, and that's what happened.

And what, I mean, so what did it do? I mean, did you see the needle moving? We had record share, record sales, record profit. In fact, the company had an annual meeting every November where thousands of people gathered in the Coliseum in downtown Cincinnati. People came from around the world. They asked me and my team to go on stage at that meeting

and tell our story about how we immersed ourselves with consumers, changed our plans, and designed a program that resonated emotionally and built a share to record levels. And it's actually a lesson I've never forgotten. All right. So another product that you work on, this is, again, another example of immersion research, which is this time it's in Europe, I think, it begins in Europe. This is in the late 90s.

Set the stage for us. Pampers was a leading diaper brand and a huge business for P&G. It's getting its butt kicked by Huggies, right? You've got to rescue or task to rescue Pampers to figure out what's going on. Huggies is just in the ascendant and Pampers is in the decline. What did you start to do? How did you start to learn about what you needed to do? Well, Guy, I was working in the Czech Republic at the time,

and my boss's boss called me one day at work and said, I want you to be at the Lufthansa Lounge and the Frankfurt Airport that night. So I met him in the Lufthansa lounge about 9 o'clock at night, and he said, Pampers is a bit of a shit show, and I'd like you to leave the Czech Republic and come here sort of immediately. and I want you to unite our team internally because Western Europe and North America were fighting each other.

And I'd like you to unite the team and figure out a way to stand for something more meaningful for our parents and to try to reinvigorate this brand. By the way, Huggies had just entered Europe and we're getting a lot of market share and that was just not acceptable. I mean, what was the problem? Pampers was, I mean, the assumption is it's diapers, right?

And so what do diapers do? They keep babies dry. Like, that's how you would market that product. But that wasn't what was resonating with parents? We spent a lot of time with parents, a lot of time with parents, and about what's important to them. It's the same as the Jiff peanut butter lesson. And obviously what's important to a parent is their physical, social, psychological development of their babies. So we said, what if we can be a help to that. Because by the way, we had people in almost every hospital in the world. sampling Pampers when the baby is born. Often it was the mother's first conversation, which was with one of our samplers. We were doing nothing with that. So we said, what if we could be the parents advocate for baby's development? And we could stand for that. And what happened is, I mean, to make a very long story short, that idea caught fire around the world. We united the Pampers global team. And within about 12 years, this was a big brand when we started, PNG's biggest brand. We tripled our

revenue and improve the profitability and set an example, frankly, for PNG corporately. Essentially, you introduced this Pampers phases product line. And so as a parent, you go to the grocery store and you see zero to three months, three to six. Correct. And that's a game changer. Yeah.

And I'll specially design for that stage of development in a way that was better than our competitive set. All right. I want to ask you about one more case study before we move on to how this applies to today, which it does in many ways. but Downy Fabric Soffener, I mean, it's amazing how many iconic products P&G owns and, you know, and sort of has put out into the world. Downy Fabric Soffener, particularly in Latin America, was in decline.

And you wanted to figure out what was going on. And so presumably you start to talk to the people who use it most. Well, this is a good example of immersion research, getting out there and spending time in people's homes and in their lives. By the way, our executive team at P&G, we met quarterly, this is the top management. Before our quarterly meeting, we would always do an immersion. We'd go spend time with people who were not like us. And so we spent time with very low-income parents in Latin America. We spread out and did this in various neighborhoods.

And what came out of that and some great research by R&D people is a new product that took the suds away after you did your wash. Now, that sounds like it's maybe silly, but these people are carrying water, sometimes, a mile, two miles, three miles to do their laundry. So if we can have them do laundry in one load of water and take the suds away quickly and have the clothes clean, fresh, and not soapy, it was an enormous benefit. So that came out of the immersion research. We act on it, we developed it, and it became a huge product around the world. You essentially reformulate the product, so it's not as sudsy.

It doesn't require as much rinsing. Correct. And you basically have a new product. Correct. Okay. So now we've heard about these three. case studies, all the results of real, like, ground research, right? And so now let's bring it to the present day and the present moment, right? We are in an era of massive data, and it's just growing.

I mean, you can measure everything now and increasingly everything more. In your view, do you feel like brands today rely too much on statistics and not enough on ground truth fact finding? It's an and guy. I mean, honestly, There's a lot of talk here in Cann this week about this. In fact, I had a nickname when I was an assistant brand manager, Jif, of Dataman. So I spent my time in the brand group just scouring the data about the brand, the competitive set, distribution, what's happening. And I would spend a lot of immersion time in stores with mothers, with parents.

You've got to do them both because insights will pop out when you're using both sides of your brain. So I'm an advocate for both. If you do one without the other, you will not be a world-class marketer or a world-class brand builder. We're going to take a quick break, but when we come back, more for my conversation with Jim Stangle live at Cannes. Stay with us. I'm Guy Raz, and you're listening to How I Built This. Hey, welcome back to the special bonus edition of How I Built This. Here's more for my conversation with Jim Stengel live on the Amazon stage and supported by Wondery at Can Lions.

So, Jim, what is a marketing campaign? that you've seen in recent years that you've really loved, that's really impressed you. Well, I can talk about things that affect my behavior. Please. Because then it gets very personal. I mean, I love that. You've had this brand on your show. I love the brand Vorei coming out of Encinitas.

I almost, my wife will laugh. I almost only wear that now. Pronounced Viori, by the way. VOR, okay. But it's okay. Viori, okay. Spelled Viori. But I was an early adopter.

My daughter, I don't know, maybe eight years ago, nine years ago, bought me some of it for Christmas and they just had as you know had a massive investment a couple years ago and they're expanding like mad you know and by the way viore is an interesting case study because when they started they really struggled you know they had a it's a good show you did with their thank you it's a really good show thank you jo could let started that brand yeah they didn't resonate and the reason why is they tried to sell yoga wear for men right in yoga in yoga studios so they really kind of took the same product and just changed the way they marketed it. They basically said, hey, this is for hiking, it's for

hanging out with your kids, it's for surfing, swimming, going to the gym, doing yoga. And somehow that clicked, you know, that started to click with consumers and it became this product and brand that first men and now women, you know, were buying because they saw it as an all-purpose, comfortable active wear brand. I'm wearing it now, guy. Those are we already, yeah, and there was nothing like it. Obviously, the landscape has changed in the time since you've left PNG, social media marketing has become much, much more important. It basically didn't exist right in 2008. And I wonder if you were still at PNG today, right, or you were running marketing at a major

organization in an era of social media influencers and the potential for AI to write ad copy, what would keep you up at night or how would you think about positioning brands now. Well, what would keep me up by night is, are the brands relevant? Are they in touch? It's easy to be irrelevant today if you're not in touch. I think what I would do, the strategies would be the same guy. I mean, where are your consumers spending their time?

How are they getting their information? Who's influencing them? And that's easy to see. Then you have to act on it. And you have to leave some of your old paradigms and frameworks behind. Kraft Hines, who is well represented here at Ken, I don't know if any of them are in the audience. They're doing some super creative work because they're following the consumer. And by the way, they're unleashing their organization to enjoy the work, to have fun with it,

to do things that are entertaining and engaging. And when you do that, good things will happen. But the same strategy, be close to your customers, understand where they are. It's just a different tactic today than it was 20 years ago. You know, I'm speaking of Kraft Hines. I saw an incredible ad campaign. I think they did it a year ago, and it's just images of people in restaurants pouring out ketchup. And in the back in the kitchen, you see somebody pouring an off-brand ketchup into a Heinz bottle.

And I think the tagline is like, it has to be Heinz. It has to be Heinz. And it's such a powerful message. And it resonates because everybody's had that experience where you dip a hot French fry into ketchup. And it's not Heinz. And most of the time, I mean, Heinz, you know, Malcolm Gladwell has written about this, right? I mean, there's a reason why you come back to that. product. I think they're going to advertise in the show guy. Yeah. Hines here, we're happy to have you.

You know, there was a panel discussion the other day about the future of advertising and this is windy here. This is nice actually. It's very, very pleasant up here on stage. It feels pretty good. And one of the panelists said it was a younger content creator and this person said, look, I think that the future of advertising is not going to be mass market TV type spots that's dead. It's going to be niche marketing. It's going to be influencer marketing. And I wonder what your take on that is. I mean, do you think there's some credence to that idea? I mean, Gary Vaynerchuk talks a lot about brands starting on social. That's largely right. I agree with that. That's where the energy is. That's where the people are. So the companies that are adjusting how they have, not their strategy, but how the strategy comes to life are the ones I think are building big brands that are relevant. We talked about Kraft

Heinz a minute ago. Those are big brands. They're in many ways mundane brands, but they are being talked about on social. They're doing things that gets attention and gets engagement. Getting attention today, you can't buy it anymore. You have to earn it. And earning it's a lot more challenging and takes a different kind of team and a different kind of work than in the old days when I was young where you could spend $60 million and pretty much get 90% awareness. it's a different world now, and the companies that realize that and are acting on it, and thankfully a lot are winning.

Do you see influencer marketing as sort of the future of where this... If it's authentic. If it's authentic. I mean, we did a little workshop this morning with CMOs and that we talked about that guy, and I mean, influencer marketing was

here when I started my career. And what did it look like? It looked like finding someone who was an expert. Or celebrity. A celebrity. committing into your company, learning about your brand, honestly believing in it, and then advocating in their circles. So the strategy is no different. It's just it happens right now at scale more quickly because of the platforms, and it's changing. Someone who's an influencer

today may not be next month. And that's why you have to be very, very in touch. You know, Mike Sezerio is at this conference, the founder of Liquid Death, and we had him on the show. I was with him yesterday. And we had him on the show a few months ago. And I think a lot of people went to his presentation and were blown away, but also feeling a little bit like, well, how can I do that in my company? Because essentially what he did was he took a tired, staid category, bottled water, and he turned it on his head. You know, he turned it into a purple cow, what Seth Godin calls purple cows. It was so weird. Like, you have to go into the grocery store and pick it up because you're looking at this can with a fiery skull and these old English letter.

and it says liquid death, and you're like, what is that? Is that mal liquor? Why is it at Whole Foods? It's so weird that you're compelled to pick it up. But for a variety of reasons, big brands weren't or aren't doing that. And it's not that they can't do that. So why, you know, when you talk to big brands and they want to be scrappy, but they can't, how do you advise them to think about taking risks?

Well, I think what Mike shared yesterday was it's about entertainment, right? And that's a different process than kind of advertising. So he's nailed that. I mean, there are brands like High Noon, which went from nothing to the leading brand in canned alcoholic beverages. You know, they're a gigantic brand. And they have a great product, interesting packaging, great distribution. So they just did the fundamentals extremely well with a pretty simple insight. People want something that tastes really great that's light, that's a daytime drink.

but I think with liquid death, one thing I would add to that, we don't maybe talk about this enough. They came out with a can because they're anti-plastic, so that was a big point of difference, and they came out with water, which is healthy, and they wanted to take business from the sugared sodas. So they had, you know, P&G-like points of difference in their brand, and I think that's a really big reason why he's been successful. You know, it's interesting because for the past, I don't know, 20, years or so, and we've had many of these brands on how I built this, we've seen lots of brands position themselves as social enterprises, right? Do good and do well, you know, a version of that, almost downplaying the business side, almost downplaying the capitalism side.

And I wonder whether, let's put aside the sort of the, let's say, moral correctness or whatever you want to say about it. Do you think consumers care? I think most do. I think they want a brand. I mean, I've done a research on this. I think they want a brand that they are proud of that is doing things that align with their values, that they respect, that they trust. I think it's important for brands to have a meaning and have a purpose. It needs to be consistent with who you are, your company's values, your heritage, what your customers care about. And when all that checks in, then I think you'll be making the right choices. Well, let's talk about politics for a moment. Nobody likes to talk.

about that, but I think it's important to talk about it. And I think probably a lot of people here have had conversations around politics. Many brands in recent years have tried to be responsive to the political climate, sometimes driven by employees at the companies. In some or even many cases, it has backfired. Now you are seeing more and more brands just say, you know, look, our job is to provide the best possible product and experience to consume. consumers, we're going to stay away from issues or politics. But that can also be a challenge. That can also be problematic. How do you navigate that? I think you have to keep your employees involved. And I think those people who make decisions without consulting deeply and frequently with their employees make bad calls, you have to stay close.

It gets back to our immersion research comment. You have to stay close to your customers. What's important to them? What do they value? I mean, many big brands appeal to all sorts of people. And you can't forget that. And so what you choose to get involved with needs to be a strategic choice in terms of what your employees and customers care about. And then stay with it, guys.

Stay with it for years. And don't wobble. I mean, we talked about Pampers earlier. They had a program to get rid of tetanus in developing markets by partnering with UNICEF. The partnership went like 20 years. And it was fabulous for the brand, fabulous for the world. And I think they made the decisions against using the right criteria. And it worked very well.

wasn't political. I mean, that's about a public health, right? You know, when we're talking about, let's, let's pick some examples. I mean, Nike famously partnered with Colin Kaepernick. Yep. It led to a 3% dip in their stock price, but then with in a month, the stock rebounded and really skyrocketed, and they increased their social media following. But it's consistent with how Nike sees the world. That was not a surprise. I don't think to anyone what Nike did. And they didn't back down. They stayed consistent with it.

So I think if you're going to take a stand like that, which I think was right for them and right for their brand and right for their values, it worked. If they had wobbled, it would have been a very different story. Do you think that younger consumers, do they punish brands that are culturally or socially or politically neutral? I don't, I think they punish brands when they don't do what they say they're going to do and they're not relevant to them.

I think it's a bit category company founder specific in terms of how people take a point of view on this. I think it's more complicated for tied to take a point of view than it is for peory. And I think that's just a reality and you have to understand that when you're managing a business like that. You at the end of the day have a responsibility to your shareholders, your communities, your people, your employees, your customers, and you've got to balance all that and that is the beauty and the complexity of leadership. You know, we have a new sort of Thursday episode called The Advice Line where I bring on past guests, founders to give advice to very, very early startup founders. People are, you know, selling trucker hats or, you know, starting their own cookie business. And the question we get again and again and again is, how do we break through?

Social media advertising is tougher. It's tougher to break through, buying ads on meta and, you know, TikTok. It's just getting harder to reach people. And so obviously you've worked with massive brands, but most businesses in the United States are small companies. There's small businesses. There's small startups. And so when somebody asks that question, how do I break through? How do I get the attention of consumers?

Where do you start? I mean, do you? I think you have to start with a really, really interesting question that a lot of people don't start with and don't have a great answer to. And that is who is that group of people who you? you want your brand to be relevant and important to? Exactly who are they? And you just can't say people 18 plus get much more specific about who you think you have a special product of service for and go after them. And it has to be big enough for you to at least meet your early business goals. But once you get that group to be aware of you, to get their attention, to buy you,

to be an advocate. It's what the military calls force multipliers. You essentially find your, I mean, there's a theory around a thousand fans. A thousand fans can really blow up a brand, right? I mean, you go back to an old P&G lesson, Fabriz, which is now a multi-billion dollar brand, wasn't always that. They made a choice about what kind of people would find the most benefit.

They started with cigarette smoking people. Wow. And then they went from there, and they kept experimenting with different groups, smelly teenagers. Yep. You know, so it starts there, and that's where you begin your marketing,

and then it's a force multiplier. Jim Stangle, thank you so much for being here. And thank you all so much for coming to the show. I am a big fan. It's an honor to be with you. Thank you for the invite. That's Jim Stangle, former global marketing officer of Procter and Gamble, and host of the CMO podcast.

And thanks to Amazon and to Wondery for hosting our conversation live at Can Lyons. And before you go, please don't forget to sign up for my newsletter. It's filled with insights and ideas from some of the world's greatest entrepreneurs. You can sign up at Fulner. guyraz.com. This episode was produced by John Isabella with music composed by Sam Paulson. It was edited by Neva Grant. Our audio engineers were Debbie Doctrie and Sina LaFredo. Our production team at How I Built This also includes Alex Chung, Carla Estevez, Casey Herman, Chris Mussini, Elaine Coates, J.C. Howard, Catherine Seifer, and Carrie Thompson. I'm Guy Raz,

and you've been listening to How I Built This.