Keep Spending More Money on Marketing That Doesn’t Deliver? That’s a Tough Pill to Swallow.
By Meghan Termat
For those seeking job security, it might be best to avoid the role of Chief Marketing Officer. Search firm SpencerStuart has reported that the median CMO tenure at the 100 most advertised brands in America is only 30 months. At less stable companies, a marketer’s time in the c-suite can be even shorter, with turnover consistently greater than other positions.
Difficulty proving effectiveness may have something to do with the revolving door of CMOs, but a Korn Ferry survey indicated only about 9 percent can’t quantify their impact. The real problem? A mismatch in the expectations of the organization for what marketing can accomplish and reality. More often than not, marketing is seen as a salve: sales are slow, and marketing is the quick-fix to the malady. While a slick campaign may offer temporary relief, it fails to address underlying conditions.
This urgent care mentality misunderstands the way marketing’s medicines works. Marketing is not an antidote for what poisons a brand, it amplifies what is true about it. The impact of even the best marketing is temporary if the brand it’s built upon isn’t fundamentally strong: companies without a solid foundation can keep upping their dosage of marketing, but it will only lead to disappointment. Organizations who want to execute marketing that leads to sustainable growth should stop switching CMOs and instead focus on nailing down the core story that can unite marketing with other functions and deliver real results.
Quiznos, the quick-service sub sandwich franchise, is a case study for the drawbacks of a marketing-first approach. Launched with little more than a toasted sandwich and a tagline, Quiznos quickly catapulted from obscurity to mainstream. Competing against Subway, the largest franchise in the world by number of stores, Quiznos differentiated by offering toasted sandwiches as an alternative to the cold subs peddled by their competitor, backed with the tagline, “mmmm…Toasty!”
This memorable marketing scheme skyrocketed growth to over 4600 restaurants by 2007. But, less than a decade later in 2016, Quiznos had declined to only 488 restaurants, a plummet unprecedented for any chain. So why didn’t marketing sustain Quiznos?
For starters, even with four CMOs during that period, the company never really nailed down its brand.
The memorable gimmick of a toasted sub attracted plenty of franchisees and curious customers. That initial success lulled Quiznos into a misconception that they’d nailed down their brand: a nifty logo, tagline, and differentiator. But branding is far more holistic: a company’s brand is how its customers feel about the organization.
The promise that underpins those feelings might start with marketing, but they must be kept by customer experience, product, and the culture of employees who deliver it. When the rest of the c-suite is content to leave brand isolated in marketing, it contributes to a fallacy: that when business is down fixing marketing will fix everything. Quiznos kept bringing in new CMOs with fresh perspectives — from Boston Market, Red Robin, and other notable brands — to treat the problem. But, if customers aren’t returning and franchisees are dropping, marketing is just the tip of the iceberg.
When businesses conclude better marketing is the medicine required to treat their pain, they are often addressing symptoms and not an underlying illness. Advertising doesn’t win back customers who had a bad experience, or partners who were let down. The deeper source of trouble is often the lack of clarity around an organization’s purpose, and the appreciation for the different components of the story that defines it.
That type of strategic decision — who a brand is, what it stands for, and how it will live that promise — requires leadership from the CEO, and buy-in from the rest of c-suite. Without that type of collaborative thinking and clear direction, CMOs unsurprisingly fail at their job. Until an organization knows who it is and why it exists, each additional dollar thrown at marketing has a high chance of going to waste.
That crucial error was a large component of why Quiznos declined so quickly. With no deeper purpose, Quiznos’ existence was defined entirely as a competitor to Subway, and even that competition was based on a feature — the toasted sub — and not some deeper longing of submarine sandwich aficionados. This comparison marketing approach worked for a while, but all Subway had to do was buy some toasters and they were back in business: one year after Subway started toasting up sandwiches, Quiznos disintegrated from 5000 to 2000 units. After that, there was no deeper foundation for Quiznos to fall back on; it had declined to define its brand beyond an imitable product and a flimsy tagline, and customer loyalty reflected that.
With nowhere else to turn, Quiznos became a reactive business. When Subway introduced the $5 footlong, Quiznos fired back with the $4 torpedo, one dollar cheaper and one inch longer to undercut Subway’s sales. Quiznos’ heavy reliance on marketing was clear in its most aggressive and competitive advertising campaign, the Prime Rib Cheesesteak Challenge. A transparent response to Subway’s cheesesteak, Quiznos’ sandwich was made with twice as much meat and was free of charge to customers not 100 percent satisfied. While these creative campaigns temporarily increased sales, approaches like the Cheesesteak Challenge only reinforced that the brand had no plan beyond trying to out-market its larger competitor. This failing strategy was fatal for a brand that requires franchisees to see long-term opportunity for continued growth.
Having a wealth of clever phrasing and creative ideas certainly wasn’t Quiznos’ problem. It was the directionless nature in which the company implemented them — because it never really understood itself from its beginning.
According to members of it corporate office, all Quiznos wanted to do with its ads was just create buzz. While the brand certainly did that, buzz is ephemeral and the brand knew neither what to do with that buzz nor how to channel it into the longevity it would need to sustain itself. This mismanagement led to sales and market share dropping by 50 percent in the five year period leading up to 2013, and, in 2014, ultimately resulted in bankruptcy; over a period of ten years, Quiznos had closed almost 90 percent of its locations. After Quiznos hired his company to manage video advertising, TubeMogul CEO Brett Wilson observed in an interview, “What we’ve learned in the last 10 years is you can’t be everything to everyone and you really have to find that core audience.” For Quiznos, that’s a lesson learned too little too late.
These are tough lessons for businesses to learn. Leaders keep falling into the marketing trap because, compared to branding, it’s faster. And, it can provide short-term relief like any painkiller. But recovering from an illness requires committing to a course of treatment that, even if it takes longer, restores a patient to long-term health. Putting the time into developing a brand, understanding why the organization exists and zeroing in on a target audience results in sustainable returns that will deliver more returns in the long-term than any ad campaign.
A story-driven organization has one core and central purpose from which the rest of the organization can fan out. Messaging based on purpose instead of messaging based on product affords a brand opportunity to grow beyond that one product. Ultimately, brands must know who they are and whom they’re targeting before attempting to fix a problem or make a change. Having these conversations around brand story will provide the organization clarity on how and where to spend its money in order to market wisely. The panacea to many business pain points, brand story will heal a company every time.
Meghan is an associate at Woden. Want to stay connected? Add Meghan on LinkedIn, read our extensive guide on how to craft your organization’s narrative, or send us an email at firstname.lastname@example.org to discuss whatever your storytelling needs may be.