In just a year, fashion brand Aritzia’s director of marketing Sally Parrott has expanded her department from two to 11; had her budget increase 40%; and she is now in the midst of finalizing a new text messaging program that will allow the Vancouver-based company’s
15-to-35 female target to opt in to receive notice of sales before anybody else. ‘It’s been a real period of crystallizing our brand strategy,’ says Parrott, adding that aggressive expansion plans in Montreal and southside are already in the works.
Aritzia’s growth seem to be the norm, according to findings in strategy’s 2nd Annual Report on the Canadian marketing sector (for full survey statistics, see pg. 34).
One hundred and twenty-one high-level marketers from across the country, mainly VPs/directors of marketing, responded to 26 questions (including a vote for Marketer of the Year) about the health of their marketing departments. And overall, it seems the upswing continues.
When it comes to department size, 36% of marketing execs say that their marketing departments are growing (55% say that they are staying the same; only 8% report decrease). And when it comes to dollars, about 27% report that their marketing budgets have grown between 6% and 15% (only 17% have been decreased at all) – all signs of a business landscape that has been holding steady over the last few years. ‘The optimism is up,’ agrees Alan Middleton, professor of marketing at Toronto’s York University. But many of the key issues facing marketers haven’t changed or improved; in fact, Middleton suspects they have intensified.
Take ROI. Thirty-eight per cent of marketers say that it continues to be the biggest issue facing the industry (followed by media fragmentation at 23% and ad clutter at 15.7%). ‘It’s not going away,’ says Middleton. ‘There’s more pressure to prove if what we do actually pays back,’ he says. That’s certainly the big challenge for Larry Futers, the new man behind automaker Mitsubishi Canada.
Futers, the former VP marketing at Volvo, prides himself as a ‘builder,’ not a status quo kind of marketer, so when he recently accepted the position as national manager, he knew he would have to prove to the brand’s Japanese HQ that a bigger marketing budget in Canada makes sense. ‘It’s easy to spend money, but it’s very difficult to efficiently measure what you do in a day,’ he says. ‘That will hopefully be one of the trademarks of [Mitsubishi Canada’s] success…. If we can show a positive return, Japan will spend more money here.’
To ensure that they do, Futers is planning to increase the online spend of his total marketing budget to 9% from 1.5%, with a focus on improving the Web site. Specifically, he plans to refine its built-in metrics and build the database, all en route to developing a deeper understanding of the Mitsubishi customer. ‘We’ll have a metrics back end that allows us to track what’s going on on the site at any given time,’ he says.
The first phase of the site will be unveiled in April, but other future tactics include better in-store metrics by possibly introducing terminals for consumers to input information while at the dealerships. The strategy served him well while at Volvo, he says, and was central when moulding better marketing strategies. ‘I’m hopeful,’ he says, that better marketing will equal improved ROI and in turn a bigger budget.
Meanwhile, in the new marketing disciplines section of the survey, 33.9% report having spent dollars on brand integration in the past 12 months, making it number one, search engines came in second at 18.2% and viral marketing third at 10.7%. Looking to the future, most plan to spend money on brand integration (29.8%,) but an overwhelming 28.1% say that they don’t know.
That number doesn’t surprise Tony Chapman, CEO of Toronto-based Capital C. He says marketers are still unsure about how – and even which – virtual channel to use to reach consumers. ‘Most of the people running marketing departments are there because they’re very good at mass marketing,’ he says. ‘You don’t get fired for making a big TV buy, but you will for putting it into an untested medium that can’t demonstrate results.’
Still, he suspects that most will not be increasing the media spend on traditional media any time soon. ‘People are dipping their little toe into the [new media] water and doing some experimentation,’ he says. And, he adds, that the time when new disciplines like advergaming, blogs, SMS and mobile become a more comfortable option for marketers is not far off.
Case in point, over at Adidas Canada, to highlight the launch of its new shoe the
T-MAC 5 BB for Houston Rockets basketball player Tracy McGrady, the brand developed an advergame based on McGrady’s 13-points-in-35-seconds run which allowed the team to beat the San Antonio Spurs. The game was exclusive to Foot Locker stores and was only promoted with POP. By trying on the shoe, consumers received an access card with a code that when entered on the specially designed site, allowed them to play a shoot out-style game and a chance to win a T-MAC 5 tracksuit. The results scored: In total 21,437 games were played, with the player exposed to the brand about 16 minutes, on average.
In addition to online efforts, PR and brand partnerships are also factoring heavily into the media mix. ‘We want to reach our target in as many touchpoints as we can,’ says Jeff Cooper, director of marketing communication at Adidas. He notes that the brand’s sponsorship of soccer’s FIFA World Cup, which starts in June, will be an opportunity to unveil these strategic alliances. ‘We’re definitely having conversations with those corporations saying: ‘Look, we both have a plan; how can we work together to leverage both of our budgets and both of our brands if we’re talking to the same target?”
And increasingly, reaching that target group is involving a closer relationship between the marketer and its media agency. According to our poll, an overwhelming 65.3% of marketers say that their media agency’s strategic input is ‘as important’ as their AOR’s. Another 11.6% say it’s ‘more important.’ Peter Francey, president and CEO of branding agency Spencer Francey Peters, says ‘blogs, podcasting are muddying the marketplace. The challenge is for marketers to know where to spend their dollars to be more visible.’ And with the immediacy of these burgeoning channels, the responsibility falls to the media agencies to wade through the options.
‘They’re the group that really knows our Canadian target,’ says Adidas’ Cooper, of the brand’s media agency Carat. He says with the bulk of the creative coming from abroad and simply being adapted, it’s the brand’s media agency that plays a central role in reaching the target, adding that the World Cup push will highlight this.
That increased reliance on the media agency perhaps ties into another key finding. While 40.5% of marketers describe the relationship with their AOR as ‘very good’ (15.7% say it’s ‘excellent’ and only 4.1% say it’s ‘troubled’), 56.2% say they’re looking for more strategic insight from their AOR. (Another 31.4% say they’d like better creative and 6.6% say it’s more senior-level participation.)
Francey is not surprised by the high number of marketers in search of more strategy: ‘They’re trying to create more of a brand experience. They can’t do that without some strategic thinking.’
York’s Middleton is far more blunt: ‘There is no evidence that agencies have recovered their clout. I think [marketers] gave up on looking for [strategy] from them a while ago,’ he says.
But some agencies are bent on changing that. David Leonard, president of DDB Toronto, says he wants the agency to become a resource to ‘solve business problems’ rather than just churn out communications. In kind, he hired Rob Newell last December as director, connections planning based in the agency’s Vancouver office, and he’s currently scouting for two other people in Toronto who will be able to provide ‘bigger picture solutions’ to clients. ‘We need to go beyond our day jobs.’
While the new division of the agency doesn’t even have a name yet, Leonard says he’s already started to work with clients like the Canadian Tourism Commission by improving its content development, and guiding the brand to strategic alliances with Parks Canada and msn.com.
As for the state of the marketing nation over 2007, look forward to the overall optimism continuing, predicts professor Middleton. ‘The industry is buoyant,’ he says.
