Pitch CMO | Craft communication that cuts through the digital clutter with Arnab Roy, Coca Cola

[Music] good afternoon um we have H we have the pleasure of having Mr Arab Bry who VP marketing Coca-Cola India and Southwest Asia um it's a large brand it's a venerable brand the word venerable is used very Loosely sometimes the word iconic is used Loosely so Coca-Cola is a vulnerable and iconic brand and it's a very large business and uh Mr Arab Roy has stayed with Coca-Cola for the last 23 plus year this his first job out of the business school he passed out of aabad and then he's been with Coca-Cola so please give Mr Arab a big round of applause big business Big Brand and uh Mr Roy is the senior leader thank you for your very kind words I think you're being extremely generous happy to help have a good no thank you I I mean it I don't think I'm overstating the case today when we started in the morning we talked about the purpose of the brand the theme of the P CMO Summit is about you know purpose-based growth what is the purpose of brand Coke as it exists so uh I'll be honest with you I'll give you my honest point of view uh I think at an overall level the purpose of any brand or any company especially if it is a publicly listed company is to ensure that we make money for our shareholders at the end of the day that's the most important one I think as we are trying to build the brand make it more relevant to the culture I think it is important to understand what the overarching values are you know are supposed to be so if I take brand Coke around the world essentially it stands for two or three I would say important values which is what I think we have been tried to be consistent for the last 13 what years plus right now um I think it's about ensuring that we are able to bring happiness to the world bring refreshment to the world and we also stand for a world that is inclusive and being inclusive I think is one of the most important core values that we have tried to remain very consistent I think throughout the overall you know decades that we have been trying to communicate ourselves so Arab uh you know at the core of C existing or any Brand's existence is customer centricity correct and uh it's looking at insights data and leveraging that to be able to enhance the purpose in business give us a sense of how over the last few years Coke has looked at Data Insights to be able to leverage the customer centricity correct so this is I'm going to speak on our overall company's approach so for all the brands it's not just coke uh I think uh I try to kind of remind everybody because when we ask anybody what do you think marketers do everybody gets excited you must be making fancy campaigns and fancy ads he must be meeting all the celebrities actually that is one of the least important pieces of the job I think where you started on getting into the data piece has been I think the fundamental kind of building block in everything that we do so there are three pieces I would say is a job of any marketer and I would urge all of you who are interested in marketing to not forget this the first is either you are bringing in new consumers growth I keep saying a market here is a growth leader yeah so end of the day growth Can Happen by either bringing in what new consumers to your brand franchise and even for a brand like Coke I think the opportunity for growth not just in India around the world is phenomenal and so everybody keeps saying that okay this is a saturated category you just kind of have a look at the numbers I think the opportunity to grow is we can easily double our business again right by the end of this year we'll probably at a worldwide level our brand in terms of the retail value because that's the best way to look at a brand because we sell concentrate that may not give a fair idea of how large your brand is but we sell close to around $120 billion worth of you know Coca-Cola in the world of brand Coca-Cola only and if I do my math as to how many people are there around the world who says that I love Coca-Cola and if kind of given a choice Coca-Cola would be my first preference but these consumers are not drinking Coca-Cola in a very frequent way there are more than 500 million people worldwide we call them what in internally we call them intenders so if you just do the math if you are able to kind of slowly bring link all these people into your business fold you can have a very very healthy growth over the next 40 50 years so just just coming back first step how do you bring more consumers and for that obviously understanding who these people are you know where are they where are their motivations what are the particular occations then you can actually bring them in so a lot kind of goes into understanding of that the second task of marketeers could also be okay if you say that okay I can't grow the consumer base your existing existing consumers can you increase their frequency of consumption because that could be the other way of growth correct if you go to a market like Mexico the per capita of brand Coca-Cola per year which is how many servings of Coca-Cola an average Mexican is having per year is close to close to 600 which means on an average every Mexican is having two coca-colas a year right if you go to Brazil that number is around 400 that number is low single digit in India and so for everything that you hear that in India there's a lot of consumption the percentage is still small it's a big business overall but the incidence number is still very small and the the depth of consumption is still very small so the second growth lever is how do you get your existing consumers to drink you more often and kind of one of the the pieces I give advice to all the young marketeers who've come in I think the way the category has been built in India for the last 25 30 years and it's got its you know reasons for that was it is a special occasion you drink it in birthdays or in parties you see big celebrities so it's not your everyday relevant occas so building occasion is fundamental if you go to markets like Latin America the only way that big number has happened because you built occasion right so that's Point number two or the third important piece of growth because that's also growth is you increase your profitability per transaction so all the three either you get new consumers or you get more depth of consumption or you improve profitability per transaction if you're not taking these three numbers honestly then you're not really having a marketing plan let's not call it a marketing plan and so in Coke most of the energy is is going into okay what are the one or two of the kind of growth levers we want to grow in in in in a particular brand or in a particular country and everything is finally decided with deep understanding of the consumers of the occas on that so that's the way I would put it now you rightly said Coca-Cola is a is a very big driver in the business but there are other brand which are very strong and uh they have their fan following so to say yeah very loyal consumers thumbs up is one of them yeah and then you have a portfolio a very diverse portfolio of if I may say Maki Brands yeah how do you ensure that each of those Brands gets the right attention and the right nurturing so the way we operate right now is that we have got five categories that have we have and that's the structure worldwide so every category has got a p&l so a brand like thumbs up is India's largest fmcg brand by the way it's not just the largest beverage brand today as we stand it is India's largest consumer brand it is bigger than any brand either in uni lver or in Proctor or any other company and obviously it's a pretty big brand so it's it's got a very big p&l end of the day you decide at the beginning of the year what's the revenue Target what's the profit Target and again based on which will finally add up to the overall number every brand I think has got its own very strong marketing plan so it's not that I can decide independently that listen I'm going to put all my money because the world actually thinks for many years that as a company we don't invest in thumbs up we putting all the money on C actually it's completely opposite C has got its pnl it has to deliver its pnl thumbs up it got it pnl it has to deliver it pnl uh we have a brand like Maza uh doing phenomenally well hopefully by next year it'll it'll become a what billion dollar brand uh and it's an interesting brand because it's got challenges on things like commodity pricing because the mango juice prices have been actually very variable if you had a bad year on the mango crop then the mango pulp price is going you know goes up we are the world's largest buyers of mango in in the world as a company so my Maza brand manager is the world's largest buyer of mango so it's interesting as to all the other I should know him I can take save money yeah so there are kind of multiple things on meeting the pnl other external factors but every brand is is obviously we ensure that we have a very sufficient amount of money but it goes back what do you want to invest should finally Drive growth if you have a plan which is not going to drive growth then it's not going to get approved as simple as that an thank you for saying that and uh we are on 7th June the summer has been around for at least 45 days how's been the summer season for you as a company and overall uh how do you think the summer products have failed I mean yours is beverages but there are air conditioners which have done well the coolers because it's been it's been intense heat yeah I think we've had a good summer um the business has been very good the business could have been far far better I think what has been happening uh what has been happening doctor is the last three years we've had a very good run very strong and as I was speaking to outside this category has been the fastest growing fmcg category okay so it's been very very strong growth Prim I would say driven that it's a highly underpenetrated category and then on the external side interestingly the infrastructure in the rural parts of India has been a Bo to our growth let's be honest with higher electrification we have been able to get more coolers out there if you have a cold thumbs up or a cold Sprite the probability of consumption is much higher so there's been multiple factors which has been playing I think last three years phenomenal growth again this summer phenomenal growth we could have grown a lot more and that was constrained with how much of supply and Manufacturing capacities we have I think one example as to why we couldn't still have our a lot of our manufacturing plants in place is we had the crisis in the Red Sea so a lot of the parts and the lines they come from Europe and they were all stuck on the way so by the time the lines are going to come in it's actually going to be June now so the Summer is gone so while we have done well I think the opportunity to grow is much more is what I would same and I'm assuming it's been the the same for all the similar categories and our competitors as well you know again um there's been chatter about that this category is Dewing and you clear to me that it is not on the contrary the potential is huge as you've talked about it however there is a movement from you know sugar based drinks and you have a uh Coke Z you have a Diet Coke so clearly you have those Alternatives but there is a movement towards non- sugary Alternatives the hell drinks are going growing water as a share of throat is growing uh you know people have started to drink Sparkling water in India yeah uh so give us a sense of what's happening in the category because you know numbers you know data you know it firstand uh use this forum to be able to put out I think we are in a point of inflection for the beverage category to explode in India now we all have to be careful on how we brand Healthy products because I think you would have seen we don't claim ourselves as we are a healthy product we are a product that you can enjoy the problem is that there are a lot of products out there beverages outside beverages who claim to be healthy when you when you have a look at the ingredients most of them actually have twice the amount of sugar than what a Coke orus Sprite would have had but the perception is that this is healthy and again the human body is processing in the same way whatever you have in terms of so you know most people think apple juice is good when I go on a flight people order an apple juice an apple juice gets absorbed by the human human body much faster than anything you can have it's basically pure sugar having a whole fruit is very good and again please please don't get me wrong we are the largest fruit juice player in India so what you claim yourselves healthy and non-healthy I think as all consumers all of us including the including the government I think we need to open our eyes and it'll happen eventually I think there is going to be an option for a lot of different kind of beverages is sparkling beverages going to go away regular absolutely not as and I said that the opportunity to grow is massive because you don't don't want to have a Kella juice every day all the time there are moments in the day when you're having a Biryani you'll want to have a thumbs up let's be honest with it right and having kind of once in a while is absolutely fine absolutely fine if you look at the ingredients and again it's absolutely fine there is no issue at all you know people have been as I said in you know otherwise the whole world would have you know collapsed if you if you compare the consumption between India and other places but I do believe there is going to be an explosion of functional beverages the challenge has never been there is a demand the challenge is can you get scale and can you make it profitable and having a profitable business in this beverage space is not easy because there is also a price point issue which finally India is is still a very important piece and how much you can get scale in it so that scale thing is very important so right now at the end of the day if you kind of look into the startup activity I don't want to name companies a lot of new brands who again have claimed to be in the healthy space if you look at the ingredients it's the same but they claim but the fact is 90% of them are actually bleeding they have an unsustainable business and I was I was sharing with you that even at a global level large companies have actually struggled in the healthy beverage space but I am a Optimist I believe and with all the kind of research that's happen happening in within our company I know that we are very close to having certain kind of beverages which we think are going to be healthy and also going to be we can scale them up because we can hopefully have them at the right I would say price point now clearly as you said a CMO is a growth leader yeah your job is to be able to create growth in the category in numbers in profitability in business um now you've done many collaborations with your partners with your agency partners you've done a collaboration with wpp on open X and Studio X yeah give us a peep into that yeah so this is a big change we're doing in terms of our marketing model and um basically three or four points I think the last 25 30 years actually we are already late honestly I feel most of our brands are already late by five six years but if you look at the last 25 years most fmcgsales and make consumers fall in love with your brand then you have got Mass channels India still remained a traditional trade market where spontaneous awareness was the game and that's how the Unilever of the world Proctors of the world Marico cbes Coca-Cola that's how we build our business there are two or three things which has happened and it is it's happening at a very fast rate in the last few years one is that we clearly see if you take live sports out the impact of TV is going down it is falling dramatically fast all of a sudden when you make your media plans when you start working on your reach frequency numbers you scratch your head that with TV you cannot get that reach frequency Target so you you have to take a step back then everybody started to say that okay I'll do digital what did most companies do they took that same TV ad made a shorter edit of it and put it on YouTube Facebook and that's the kind of way the communication has been going okay digital that's that's broadly okay and the point is it's still the same problem Point number two what is happening as of last year official number in India which is the Hub Global Hub of content creation today India is the Global Hub of content creation 10 m million pieces of exclusive content are being released every day in India 10 million through your local social media channels everybody everybody and his brother is making reals putting some content out here how the hell can we assume that your TVC is going to stand out in that clutter so all of a sudden for marketeers to start thinking we have to rethink the way we are making content therefore the whole partnership with w PPN India is actually the pilot market for this and we've we've done some very good examples and they're scaling it up worldwide right now we said that we'll probably go and it interesting because this was the model earlier in some way or the other but it's a group of people 30 40 people who actually come from the media agency the digital agency the creative agency and they're working hand inand and it's almost like an always on content ecosystem so it's not something you plan there will be some TV let let me be honest there will still be some role of TV but as you move into what we call content ecosystems which need every day five 6 10 20 30 pieces of content to be released you cannot go by the earlier plan so it's a very kind of different approach which is agile always on which is kind of digital first which is social at heart and that's the concept of this open X uh which is the which is a virtual concept but Studio X is a real world if you go to the wppp office right now in gurgo you can actually see Studio X right there and we are opening smaller Studio X in other parts of the country which is this group of people who are always at it in terms of kind of releasing content at a at a phenomenal level every day so that's the future of content the nucleus of that will be cont content ecosystems whether Coke Studio most people think it's just okay I'm releasing some songs but Coke Studio has become a big content ecosystem for me the highest amount of consumer engagement on brand Coca-Cola is happening through the Coke Studio ecosystem today and that's the build building the brand love the local connect the regional connect is all happening through that similar things we are doing on all the brands is building these content ecosystems and that's or IP is what we call internally thank you so much Arab um music music Sports Cricket entertainment uh for your portfolio brands have been big drivers of yeah saliens as well as showcasing as well as consumption uh wherever you sponsor the pouring rights are yeah Coke right or Associated Brands give a sense of what is going to happen in this season uh you know I always say the season starts in July August September October uh give us of what kind of new communication we'll see what kind of new IPS we'll see and how will you deepen your association with sports music and entertainment ecosystem yeah so we've taken a very clear-cut role on each brand playing a particular approach to a passion point and you would have seen on coch we have kind of taken a brand coch has taken a little bit of backseat on Cricket simple reason being going back to the p&l cricket is expensive in India and if I have to you know justify my Roi on Cricket Investments it has to be done with thumbs up and thumbs up historically has had a lot of history with the with the sport and plus with the audience consumer we said thumbs up is going to be focused on Cricket and that's what we've been doing for the last three years Coke has going all out with music uh we brought back Coke Studio though in a very different Avatar it's a digital first approach uh and I just continue to see the opportunity of making making this IP far stronger and the engagement especially with the teens around the regional parts of India has been fantastic so music will continue to be a big part for cop it's not going to stop we are sponsoring the on ground ic20 right now but because it's happening in the US it'll still you'll see Coke there but all our activation has been happening with thumbs up in India on Sprite we are trying to take a big bet on the comedy space so those those are the three Passion points music sport comedy if you look at all the charts and Sprite has got a history of being close to humor if you look at the way the brand has been built it's always had this nice link with Huma it's a light-hearted brand and we saw a phenomenal opportunity to go and tap into the exploding space of comedy in India and I think it can be it's a massive very fertile space so we feel very excited we've done now two seasons of what we call it's an IP we're trying to build called joke in a bottle in terms of transactions getting first party data phenomenal results but I hopefully have been able to you know convince to get some more investment in that and I'm excited to how we expand the comedy space next year so that that that's the way we're going to be working on now you talked about 24x7 content ecosystem you talked about you know 10 million pieces of content being created in in a day out of India clearly uh there are fears on Def fake uh and what may happen because of accidentally or intentionally to harm the brand so how are you using technology to be able to or AI to be able to integrate that into your marketing on content touch points yeah I think AI is going to be the single biggest impact in marketing in the last I would say three three four decades okay AI is here to stay everything that I have seen not only in India but abroad and all the experiments we are seeing all the people we speaking to AI is going to change marketing three areas where AI is going to make a significant difference first is on in basically Data Mining and data analysis and the kind of stuff that I got a chance to see when I was in Atlanta a couple of weeks ago go I think was phenomenal so the way we a human being can with the right tools can leverage AI to arrive at insights at a phenomenal speed I think is going to completely change the way we playing the game I would urge all of you to Google about which I'm kind of learning every day what we call synthetic consumers and there are companies who are operating on the concept of synthetic consumers and how you will start getting insights from proper synthetic consumers is phenomenal so first this whole Insight space I think AI is going to be much ahead of the game so that's going to be commoditized completely Point number two is I think how production is going to change creation of content creation of content tvcs it's not just tvcs yes video content but video content I think is going to change completely and we've already experimented that and I'll give you a simple story we ran a small digital platform called fan pulse in the last World Cup where Hara Bogle would come every day and give a quick summary of the match you know guess what Hara B we had him for two hours only we had him for two hours yet we had Hara Bogle to come in and you as a consumer could actually see his match summary you looking exactly like real life that he's giving a fresh summary completely you know done by AI That's not in 5 years it's already happened so so that's the second point where I think production is going to completely change everything the third thing is again a little bit interesting is a combination of what's going to happen on the ground on products Innovation as we are starting to think about it I think I'll give you a simple example it took us 10 years to get to the right sweetener for Coke Zero it will take you 10 minutes what today to make a new iteration on that uh with the power of AI you can go and have back smell taste flavors everything so the speed at which you'll see new products coming in is going to change completely and that worries big companies like us because that you used to invest in R&D in a big way so I because I spoke about it whether it's in kind of juices and all of that flavor signs was our domain the big labs and that is completely going to be hacked right now because if you are a startup you can go and open up a new company with the power of AI you can actually you know develop phenomenal products how that's going to impact with time to see but I just want to give you a glimpse it's not just communication it's the side of product development and a lot of stuff happening individually in the markets based on kind of local needs and tastes how you can actually tune fine tune I think is also here as a big opportunity for I to change fantastic uh Al now uh my last question to you yeah marketing is changing uh hence the marketeers are also evolving yeah and uh the role of a marketer is not just communication it is understanding every driver of growth absolutely whether it's supply chain S whether it's distribution and of course communication and consumer insights as a professional how do you keep yourself evolving a part of the fact that you into Atlanta and saw what's happening the Coca-Cola headquarters in terms of innovation how does a CMO he or she keep herself updated and relevant what should in CMO evolve into yeah so as a principle and leave whether it's a CMO or it's a marketeer it's the same I think the marketing books that we have had all these years I think some principles will not change so as I go back finally the three principles say spoke about that role is not going to change it's only the way you're going to achieve those objectives because finally it's growth so not to forget that the growth is the ultimate game and then what's happening but I think have a curious and open mind because a lot of the communication principles is being completely torn apart so we have to be very open-minded as to what we're learning secondly I think digital is becoming like an Excel PowerPoint today if you are not a digitally Savvy marketeer you're not a marketeer because the world has already become that if you don't understand how the world is going to work in this new world I think you unfortunately you are not in the right job and as I've said maybe and even in not this has been the last generation of a analog marketing officer the era is over for these people if I don't evolve myself even for me to grow Within the company I think understanding of how AI Works what's understanding of mtech for example is becoming very important we spoke a lot about it first party data becoming critical as we move into communication into platforms understanding the technology Stacks that go and support it if you don't understand that you cannot have the communication you don't know where the costs are going to come from what is going to impact and especially then with AI coming in understanding of the technical side becomes important so be open-minded be curious always that's fundamental keep your strategy clean that's always important but then the digital and Tech side is going to be become the most important piece so I would urge everybody out here that immerse yourself and it is not rocket science it's only inertia it is not rocket science it's about that's why I I tell my team start understanding this it's fine what will happen you'll fail in your first attempt to learn learn again and experiment a lot and that's the only way you will keep learning thank you so much arnab please give Mr arnab Ro a big round of applause uh I you know whenever I do a panel I close it by recommending a book or a person to follow or a YouTube channel to watch I used to do only a book 10 years back so would you like to recommend any book or a person to follow or a YouTube channel to watch yeah good question um I follow Scott Galloway Scott Galloway is a he's a very pragmatic and he's actually a marketing Professor but he's a very pragmatic marketing Professor I kind of love him uh I would and I'm a big fan of K pardon kangan sorry I thought you said no no I'm a big fan of Daniel canaman of course slow fast it's it's one of one of the best books that I would recommend every marketer to just read it it's a heavy book you have to read it twice Thrice four times to really understand but from understanding the basics of marketing I think fundamentals of how human behavior is I think that's a phenomenal book thank you so much and uh I would recommend a professor he's a professor in Canada his name is sard God and that's a real name s a a d g a a d and um he has a contrarian thinking and that's why I love he challenges almost every notion that you think exists and you know it so I mean if it matters Elon Musk also follows him but I also follow him so uh that's for today please do go have a Coke today when you celebrate or thumbs up uh I'm sure it'll get you more energized please give another gain a big round of applause thank you [Music]

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Keywords: Marketing, Media, Advertising, Ad Reviews, Media News, Marketing News, Latest industry updates, Print, IPRCCA, Events, IDMA

Id: tVqrec9NFv4

Length: 35min 4sec (2104 seconds)

Published: Fri Jun 07 2024