How centralization is hurting Canadian marketing

Twenty years ago, it was all so simple: You made it here, you marketed it here, you sold it here.
High international tariffs, differences in regulation, a culture of local and regional offices making independent decisions based on the needs of local consumers - all this was the hallmark of Canada's Golden Age of marketing management. Canada was seen, despite its relatively small size and market, as an innovator, a producer of global-class general managers, borne out of a unique, broad-minded Canadian perspective needed to understand and respect all cultures, and the necessity of having to do more with less.

Twenty years ago, it was all so simple: You made it here, you marketed it here, you sold it here.

High international tariffs, differences in regulation, a culture of local and regional offices making independent decisions based on the needs of local consumers – all this was the hallmark of Canada’s Golden Age of marketing management. Canada was seen, despite its relatively small size and market, as an innovator, a producer of global-class general managers, borne out of a unique, broad-minded Canadian perspective needed to understand and respect all cultures, and the necessity of having to do more with less.

Flash forward to 2001. You can fire a cannon through what were formerly the Canadian product development departments of most major global packaged goods companies and only disturb the dust.

The North American Free Trade Agreement, the maturing of many product categories and the Internet have meant that small markets like Canada are no longer regarded as financially feasible or necessary as independent entities.

For many multi-national marketing companies, strategy is now completely a head-office function. Local subsidiaries are charged with taking a globally harmonized strategy and a globally harmonized product and, often, then applying globally harmonized creative.

What is being taken away is the authority for regional offices to develop products, strategies and marketing campaigns that address the local situation, competitive environment and, of course, consumers.

While these decisions are ostensibly based on what is good for the overall business, the effect on the Canadian marketing community is quite severe.

Already, companies like Procter & Gamble (whose first international office was Canada), which moved to a centralized global strategy in all of its categories two years ago, are removing titles like ‘brand manager’ from its roster, and reducing, if not eliminating, the amount of copy training given to its employees. Why train local people on developing creative, if creative is no longer a local initiative?

It’s evident that Canadian marketing management, as we once knew and loved it, is changing and the effects are being widely felt:

* Diminishment in the role and stature of marketing in Canada.

The biggest impact is on the industry itself. Marketing has struggled with its attempts to define itself as a professional function. The fact that core aspects of our function can be ‘imported,’ minimized and reduced, further sets back marketing’s attempts to establish itself as a core, strategic function.

* Reductions in the quality of and opportunities for Canadian marketers.

Canada has historically been regarded as a great training ground for global marketers. Our level of economic and educational development and our proximity to the U.S. have allowed us many of the advantages and opportunities of our cousins to the south, while our ‘cultural mosaic’ and regional differences gave us exposure to the intricacies of dealing with non-generic consumers.

The result has been that Canadian-trained marketers occupy the top spots of marketing organizations around the world. Without the training offered by developing marketing and creative strategy, researching the consumer and developing new products, the skill set of tomorrow’s Canadian marketing managers will be reduced.

* Lack of consumer focus.

The driving forces behind the globally centralized strategy are cost savings and efficiency, not increased consumer focus. Yet, marketing is first and foremost about understanding the consumer, who, in a globally centralized world, is not spoken to in the same voice as in the locally developed world.

Are global marketers giving up on the consumer? The ones who told us that 600+ SKUs of cough/cold remedies were necessary to meet the needs of consumers are now telling us that one globally harmonized product, package and marketing campaign is sufficient.

* Ripple effects in the broader industry.

What will happen to the advertising industry in Canada, the production industry, the research industry? As goes the client, so goes the supplier.

With fewer and fewer marketers spending the big bucks on the consumer, there will be less and less opportunity for the related industries to show their stuff. If marketers are not developing strategic or consumer-focused programs, then these partner industries will have fewer and fewer opportunities to develop and profile their own abilities.

Will the biggest news about advertising in Canada in the future be about media account wins and not creative?

The good news is that there are still some industries that are thriving locally. Beer, food and retail, for example, have been able to maintain Canadian-focused marketing efforts.

While consumer-based marketing activities are becoming more globalized, trade-based activities are not. Despite the development of international retail chains like Wal-Mart and Safeway, the retail environment is still largely local. As such, the opportunity for marketers is to put a greater effort towards trade marketing, reaching the consumer at shelf level.

The long and the short of it, however, adds up to a diminishment in the profile and opportunity for the Canadian marketer. As we worry about a brain-drain drawing our best and brightest to the south, the marketing world is losing more than just its people, it is losing its stature as an industry.

Michael W. Shekter runs The Marketing ADVISORY in Toronto, a consulting, training and resource service for the marketing community. He can be reached at michaels@marketingadvisory.com