One is a seasoned marketing executive with a technology industry institution and a co-inventor of a U.S. patent for advanced semiconductor lithography technology. The second leader left a major consumer brand to lead marketing at a startup travel organization that has become an industry disruptor and provocateur. The third took a bet on authenticity, convincing the organization to openly acknowledge poor product quality in a very public ad campaign and subsequently spurring a major brand turnaround. Three distinct panelists from three distinct marketing and organizational cultures joined the panel for the 2015 Spencer Stuart’s CMO Summit to discuss one shared belief: Culture matters to the brand experience.
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While culture is often regarded as a “soft” topic, panelists Jon Iwata, senior vice president of marketing and communications at IBM, Jonathan Mildenhall, CMO of Airbnb, and Russell Weiner, president of Domino’s USA and former CMO of Domino’s Pizza, shared how culture clearly leads to tangible results for both the customer experience and the organization. Here are some highlights from the discussion:
Before, culture was part of the game. Now culture is the game. Before an organization can determine how the culture affects the brand experience, it must define it. Mildenhall described culture as the summation of people, processes, product and values. Iwata referenced a well-known quote from former IBM chairman and CEO Lou Gerstner: “Culture isn't just one aspect of the game, it is the game.” The word “authenticity” is often used in discussions about culture and brand, but the customer’s experience is what truly defines the brand. Organizations renowned for customer service have created rituals out of the behaviors they want to stand for, such as a grocery store chain where associates physically walk a customer to an item rather than simply giving verbal directions. Inspired by this, Iwata said IBM created its own cultural ritual of starting every meeting with a story, which has evolved into an app and repository of more than 5,000 crowd-sourced stories. Airbnb gives annual values awards to encourage everyone to dedicate time to thinking about how certain colleagues personify the culture.
Could friction be a good thing? In a poll of the audience, 93% said they have experienced friction between the marketing team’s culture and the broader organization’s culture. Mildenhall reframed the issue as tension rather than friction, noting that a push and pull between left- and right-brained people can yield well-rounded solutions vs. friction, which grinds all parties down. At the same time, marketing can be a powerful influencer of the overall culture. Weiner advised, “Don’t underestimate your ability as a marketer to change your organization’s values.” For example, when a customer tweeted a picture of a pizza that was delivered to his home mangled, the marketing team ran a national TV spot showing the photo of the pizza, apologizing to that individual customer by name and promising to do their best to never let it happen again. Seeing that the company would go so far to change poor performance upped the ante for franchises, who did not want their own pizza featured negatively on such a public scale; product scores increased dramatically shortly thereafter.
Passion is powerful … How the internal team feels about the culture can influence customers’ experience with the brand. Weiner quoted author and leadership adviser Simon Sinek: “Customers will never love a company until the employees love it first.” When the audience was asked what they would like to see more of in their marketing teams’ cultures, fun, passion and excitement topped the wish list. Mildenhall witnessed firsthand the vital importance of passion to the business in his earlier role at Coca-Cola: “We brought in a load of people from outside the organization and the mission was to instill belief through passionate action around the product, and eight years later, the share price was at an all-time high. We motivated all the powerful stakeholders in the organization to get passionate about the purpose of the brand and that was reflected in the consumer marketing. Consumers started to see brave, disruptive, interesting and engaging marketing and they too started to get passionate about the brand. When consumers start to get passionate about the brand, they buy more of it. Passion cannot be underestimated — it’s a major driver of business performance.”
… but make sure you define it correctly. Iwata cautioned, “Sometimes in business, particularly American business, we confuse passion with emotion. We always want a leader with passion, and some of my colleagues will ask, “These three people, they’re equally good — but who’s the passionate leader?” Some of them respond, “It’s so-and-so because when they miss their target, they explode. They throw pencils. They emote.” He noted that passion can be expressed in different ways, such as an intolerance of not meeting quality standards, and that quieter, more subdued leaders can be just as passionate as their more animated counterparts.
Beware the “spinovation.” When asked what top skills marketing leaders need, only 10 percent of audience members said innovation. Happily surprised at the result given the inherent challenge in true innovation, Weiner commented, “Some people define innovation the wrong way. They’re actually ‘spinovations,’ just a spin on something that already exists. Real innovation is hard. Innovations don’t fall from trees and their creation takes long-term investment, which is what I try to tell my board all the time.”
Millennials are today’s culture police. Airbnb's CEO wrote a post dedicated to preserving the company’s culture, a culture that Mildenhall credits with creating a sustainable, multigenerational organization. What he and the company’s founders, who are millennials themselves, have learned is that this generation of talent is driven by purpose and fiercely protective of the culture. “They police the culture themselves and it really is amazing, the emails that might get sent if somebody compromises the spirit of trust or creativity or hospitality,” he said. “The culture is so strong that if anybody breaks it, it’s not senior leadership who have to come in and kind of fix it. My goodness, they get smoked out very, very quickly.”
Don’t be the “Al Bundy” of culture. By a show of hands, most marketers in the audience said they are working on brands that are more than 20 years old, facing the added challenge of updating a long-held culture. Weiner made the analogy that companies cannot be “Al Bundy from Married...with Children, still talking about high school,” lauding the past while neglecting the present and future. Instead, he advised, “Look back to the history and update it for today.” For example, maintain committed to the original product, but modernize how it reaches consumers in a digital age. Iwata has noticed IBM’s culture evolve as a result of employee population shifts — a large number of employees have been at the organization for less than five years while some leadership veterans began as interns and have spent their entire careers there.
To assess for culture fit, ask the right people the right questions. “How do you assess for culture fit when people are on their best behavior during the interview process?” inquired an audience member. Weiner recommended that instead of talking to a candidate’s boss, talk to the people who worked for and alongside the candidate. He also suggested asking the candidate to name three ways he or she has helped someone else’s career. In addition, some organizations put candidates through a rigorous cultural assessment process. Mildenhall underscored the importance of culture fit, noting that even the “ideal” candidate will not be hired if he or she doesn’t pass the organization’s stringent values assessment.
Culture represents the shared values, beliefs and assumptions that shape how work gets done. As the panelists reinforced, the influence of culture is far-reaching, from the consumer’s perception of the product to the fit of a new leader with the marketing team. Organizations and leaders who understand how their cultures imbue everything they do — and everything their consumers experience — are best positioned to deliver the strongest brand experiences.