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Best New Thinking Winner 2010

Diageo Planning Team

Planning goes corporate – Diageo planning leadership meeting

storehouseI’m in a conference room in the Guinness Storehouse in Dublin – Ireland’s biggest tourist attraction in the world capital of craic. There may be better places to have international meets but right now I can’t think of one.  The presenter is telling the audience of 20 that there needs to be a step change in the way the department works  – competitive advantage has been eroding. She asks for the mission statement for the 2011 business goal – 3 people call it out. We have had feedback from the management leadership programme, benchmarks for engagement with company values – apparently the Philippines office is off the scale for super-engagement. The language and the ethos are entirely familiar – and could be found in any large international corporation. What makes this gathering extraordinary is that this is a planning department at work – the planning leadership team of Diageo at one of their twice yearly 3 day conferences.

These 20 people represent a global team of 130 consumer planners – what has to be one of the largest teams of planners in existence.  They are structured in a matrix – vertically by geographical areas each with their own planning head. But there are also 9 global planners whose remit covers specific Diageo brands around the planet. There are also exotic planning variants I have never encountered before, for example a fledgling innovation planning department of 13.  Later in the proceedings one of the sessions is led by Diageo’s first retail planner. But I am running ahead.  This planning team feels huge – thoroughly interconnected and drilled to ensure that the ways of working are transferred across markets. They even have their own redcaps – a team of 4 charged with training all the planners in the application of bespoke planning tools and in keeping a watching brief on emerging research and planning techniques.

the most respected and admired for creating and leveraging insights that drive growth

The mission statement goes something like this – By 2011 we will make the planning function the most respected and admired for creating and leveraging insights that drive growth. As the presentation continues Michael Harvey global head of planning leans over to translate a stream of acronyms 5Is, DWBB, TCUT, CPR the list goes on. Then follows a breakout session to brainstorm what is needed to ‘raise the bar’. Wandering between the groups I hear the perennial grumbles of planners – just following the set processes doesn’t guarantee a breakthrough  – we need more access to senior people to learn from. Planning is perpetually caught between trying to get more out of a few very senior people and creating standardised processes which enable less experienced planners to work much more systematically and effectively. The great planning cultures in advertising agencies have always been a balance between these two – I just never expected to see this tension being worked through in a client company.  As the discussion continues I discover there have been a number of meetings to share knowledge with other major corporations: Unilever, Nestle and even GSK are mentioned in passing.  If you’re not in direct competition then why not find ways to collaborate?

plt1We have a session with the marketing director of Ireland who itemises the recent contributions planners have made to the business: helping to reverse the decline in Guinness sales, growing market share in Harp, launching Bud Light against Coors with a 7 year lead and matching their market share in 12 months.  This testimonial turns out to be something of a coup – the planning department in Ireland was struggling a couple of years ago and facing re-organisation – this is evidence that the department is doing something right which is valued by the rest of the business.

So what does planning clientside look like?  Michael chunks it down into the areas of market planning, campaign development and evaluation. He feels that they can train up planners in the first and third areas but he has had to hire in planning expertise from advertising agencies when it comes to creative development. Perhaps half a dozen at the event are ex-agency planners and one by one they make themselves known. There is an important caveat though – any recruit from an agency is grilled to ensure that they are ready and willing for the much broader requirements of the planning job clientside. Planners have to be willing to immerse themselves in the nitty-gritty of product launches and reformulations. They won’t survive if they insist on staying in advertising planning mode. The core of what planners have to deliver in Diageo is insights, insights which must be shown to be driving the business forward. So the planning department is in effect an insight department – many of the planners are researchers but being used in the classic planning role – fully integrated with rest of the team and expected to make a pro-active contribution to the development of the business – no research department wallflowers here.

pokerDuring the afternoon we have an introductory session for a new shopper model. The reason for introducing it is to ensure that everyone is happy with the basic structure – specifically that the model can be applied to their own markets. If they don’t shape the model at this point they will be expected to apply it anyway.  A pentahedron rolls onto the screen and keeps revolving. The face of the pentahedron has the usage occasion – the 5 supporting faces show one of two states – each of which is marked as being primary or secondary. Using this tool a promotion can be tickboxed to ensure that it taps into the key consumption drivers.

robertflavinRobert Flavin the retail planner demonstrates the approach with a number of case studies – two for Guinness involving a poker set and a rugby kit. And one for an instore Chill-out stand which has encouraged people to buy spirits and mixers plus fresh lemons and limes at full price. Part of the business case for taking up the extra space with the stand is the higher margin opportunity and rate of sale relative to the facings it displaces.  There is some discussion about the number of insights Robert is using – he has cited for each promotion a shopper insight as well as a consumer insight – this leads to a debate about single mindedness . The difficulty is that apparently there are fewer shopper insights than consumption insights – but a retail offering can hardly be framed without reference to how the purchaser interacts with the product.

We finish the day’s proceedings with a tasting of Irish whiskey – our taster blends blarney with a huge palate of words to help us to articulate what we’re tasting.  The selling of Bushmills whiskey is an interesting challenge – it was Diageo’s defining of Scottish whisky via the six classic malts which has created a whole generation of whisky drinkers who are resistant to drinking blends. It is going to be interesting to see how they promote blended malts to a younger adult age group.

This is the second tasting of the day – the first was a waltz through a range of wonderful bottled beers with Roger Protz. In both sessions I was struck by how rich the language of tasting is and how seriously it was treated by the team – to know your products you have to understand the history and the context in which they have been made – and you need the vocabulary to go with it – very much more than resorting to cliché and provenance to communicate distinctiveness.



The Bushmills tasting

Over dinner I quizzed some of the planners about how they interacted with their opposite numbers agency side. Particularly since there has been a tendency for clients to jib at paying for planning in other communication disciplines if they have already paid for an advertising planner. What about a client who has already has a planning department in-house? From their answers it was clear that the prevailing view is that planning is a function which creates value rather than reduces costs. They expect all their partner agencies to use planners on their side – that is how the quality is delivered.

bushmills3The following morning we have a session on ‘premiumisation’ led by Ben Itty and Andy. Their particular territory is the reserve brands – where spirits are laid down for years. But this session is about how to increase value among standard brands. There have been a deflationary pressures in Europe which have made the sales hesitant in seeking price increases – and commercial pressures make it all to easy to get hooked on growth spurts through price promotions. At one point Michael asks Jim head of planning in the USA to comment on the trends stateside which have driven price points and premium formulations ever higher.  This is a lovely example of global thinking – cross fertilising knowledge in one market by the experience in another – there is no reason why the trend towards price cutting should be inevitable or acceptable.  There is a brief exchange about the factors which have driven Americans to paying more for premium spirits.

There are 3 tools in the armoury for pushing up prices. Each is itemised. At the end of this session Michael Harvey says with some satisfaction that the nature and level of the debate is something he wouldn’t expect to find in an agency which is why Diageo has had to develop its own distinctive planning culture. At the end of the session Ben offers to visit a number of different markets to take the message of premiumisation to the local teams – these offers are accepted with alacrity and diaries got out to sort dates. It appears that specialist planning expertise is highly prized as something the local planning departments can use to build understanding and support from their colleagues in the rest of the business. And using the current structure there is a steady supply of such specialists moving around between markets sharing learnings or initiative between the twice yearly meetings.

I had an alternative take on the topic over breakfast with Aymeric de Maestre who works out of the Moet-Chandon office and straddles Diageo culture and the luxury marketing of Moet where you don’t ask – you’re supposed to know what luxury your customers aspire to.  This is a really interesting bunch of people – these events are measured not only by the content during the working sessions but by the quality of the interaction between the planners who are brought together.

The event finishes at midday – everyone seems to be scrambling for either a Blackberry, a conference call or a plane.  I managed to catch Jim between conference calls to ask him where he find planners in the USA. ‘Its easier than it used to be now we’ve moved the office to New York’ he says ‘we tend to find them in boutique agencies.’  Then he’s off again.

I arrange to finish the day with Tom Armstrong in a bar that produces its own beer. Guinness isn’t on the menu but half a dozen other stouts are. There is an ingenious promotion where you buy a pint of beer in 3 smaller glasses on a gigantic beer mat.  So you can sample a greater variety of the beers on offer.  While I am waiting for Tom I try to pull the strands together.

bushmills1This planning department certainly felt as different from a conventional client research department as a car is from a horseless carriage – it had its own agenda, it appeared to be well integrated within the rest of the business and planners were expected to be pro-active.  All planning departments pay at least lip service to training but this department had taken particular trouble to standardise working practices and to cross fertilise learnings to an extent I haven’t seen other planning departments doing. Even those in large international agencies who must have a wealth of expertise to share.   In recent years much of the focus in planning has fallen on blogs and meetings in cafes – which has proved a fertile breeding ground for beginners to learns and for the discussion of new ideas.  What I saw in Dublin felt a little akin to the way jazz moved from the bars to the conservatory a generation ago.  The purists might bewail it but the immediate effect was a quantum leap in technique and the rapidity with which musical ideas could be taught and transferred.

One of the challenges for agency side planning is whether the haphazard methods for recruitment and training deliver sufficient expertise. One head of planning in North America told me that the arrival of blogging had allowed him to slash his training budgets.  I suspect this will prove to be a false economy.  Account planning is a virus – it mutates easily and rapidly but has the virtue of taking a stable form wherever you find it – the Diageo version was instantly recognisable but clearly re-purposed for a global corporation. The real question is what other client companies make of it – this isn’t about competing with agency planners. But if I were a company trying to wring more value out of my research department and wondering whether to migrate them all into insighters – then I would be taking a long hard look at the planning model. Insight generation isn’t the goal of planning – it is a waypoint. Planning does a lot more than spot insights. It has proved powerful and persistent because it applies them.



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