CMO WORLD TOUR: Chris Burggraeve, global CMO for AB InBev, on understanding digital

There are two types of people at AB InBev: those who sell beer and those who help sell beer.

Global chief marketing officer Chris Burggraeve may not be serving behind the bar but he’s potentially one of the most important helpers at the world’s biggest beer company.

His goal is to turn a brewing titan built by acquisition from a “sales-driven machine” to a “consumer-centric sales-driven machine”, ready for the digital age.

An ex-Procter&Gamble and Coca-Cola marketer, Burggraeve is a practising digital immigrant who leads the company into the digital age. He likes his Blackberry, uses Facebook but only accepts personal friends, and is proud to have an iPad 2, the digital device he would least like to give up.

Digital is also changing the way he does his job; everyday he checks key brand-related keywords on Tweetdeck to feel the pulse of AB and its brands.

Burggraeve – who is also President of the World Federation of Advertisers (WFA) – says the primary challenge for companies such as his in adapting to the digital age has been organisational change.

“The first thing to shift was the mindset from the top of the company to the bottom. It’s ensuring people understand that we’ve moved from an era that was TV-centric with everything around it to a second era where you put digital in the middle and TV became a secondary medium. Now, we spend a lot of energy to make sure our marketers understand that people are in the middle.” he says.

Doing this in a very traditional sector where 80 per cent of the media mix is TV hasn’t been simple. The company embarked on an extensive training programme working to take people out of their comfort zones – from board members through to senior managers, those operating the businesses and, of course, marketers.

“It’s become easier thereafter to come with the tools and technologies and the plans because people now know why you’re spending time on it and what we know and what we don’t know,” he says.

The AB InBev marketing philosophy is based around identifying connection points with its target audience. While these are increasingly digital, point of sale cannot be forgotten.

Burggraeve has recently been on a market visit to Guangzhou City in China, where outdoor posters and in-bar material remain critical.

“People are serving beer in big buckets. So you have Budweiser cans in a bucket. Now one of the questions we ask ourselves all the time is: if Steve Jobs were to design this bucket, what would this bucket look like? So we will design the iBucket.”

FC: In 10 years’ time, how do you think your job as a CMO will have changed?

CB: I think the key change will be the convergence between what the marketing director is doing with what the corporate affairs person is doing; the convergence between stakeholder management and the consumer, influencing consumer behaviour and attitudes.

With technology, the two worlds are becoming interlinked. [The consumer] becomes a very active stakeholder and, unless you understand that as a marketer, you will be completely lost.

Social media puts the power completely in [the consumers’] hands and I think you ignore this at your peril as a marketer. So we need to understand how we can harness the power of social media and let go.

We need to let go part of our brand, but let go. People say let go completely, I don’t think marketers can and should ever let go completely. So we need to find a right new balance ying-yang type of relationship with technology and the consumer.

FC: How do you think the role of brand manager has changed since you started your career?

CB: I think the brand manager today has many more tools at his or her disposal and is under much more pressure from a consumer [who is] now a stake holder.

The consumer in the old days was more apathetic and before you [got] anything back [explaining] where they stood, a year had passed. Now 10 seconds have passed. So that’s good and bad. As a relationship manager with the consumer, the brand manager of the future will be under much more pressure. It will be a much tougher job today than I think we have.

But it’s much more fun, much more enriching – as long as you immerse yourself in the tools and constantly upgrade your capability

FC: Do you still have barriers in terms of organisation that you need to overcome when it comes to using digital media?

CB: The barriers have gone down substantially. I think the barrier is more macro-economic: it’s such a fragile new capability that if the world turns tough – and it was tough in 2008, 2009 for everybody – people turn to what they know. A whole generation of managers, including myself, have been trained in the TV society and people go back to what they know: “Show me the ad”.

That’s something we have to resist and say: “okay, let’s not go back to the good old days”. Conversely don’t make the mistake of saying: “let’s cut TV completely and go completely digital”, because that maybe wrong too. It’s finding the right balance [and] we are very clear. For us, TV is very important but it must be done differently from how we did it before.

FC: How does your focus on digital channels change from region to region and brand to brand?

CB: We have about 250 brands. Within that portfolio we focus on a number of brands that are making the difference. We call them the focus brands and what I have asked each focus brand to do is to think how to use digital in the smartest way. Some lend themselves more naturally to it than others, but everybody discovers a clever way to use it in the connection mix.

FC: For instance?

CB: In New York and Toronto, on Stella Artois, we invited selected trendsetters to become ambassadors for the beer brand by giving them early insights, information and other incentives. We measure side by side – this is my P&G training – you measure whether a sample that is not in the club versus the club [and] whether the behaviour and attitude are different and significant enough to warrant the investment.

And the answer is yes. They love the brand more, they are more loyal and they talk about the brand around them. They are the most powerful sales force we have. So we are scaling this.

FC: Does AB InBev globally issue guidance on levels of digital spend?

CB: We have no dogmas around percentages; nothing tells me that 5 per cent or 10 per cent of the budget or 30 per cent or 100 per cent is magic. That’s why I’m saying we are very careful about outcomes and not about the means to the end. Digital helps us to connect with consumers in ways we couldn’t before. But as a marketer what I’m obsessed about is to track brand health on a monthly basis and how we achieve that is irrelevant.

FC: Is AB InBev setting up global media deals with digital media players?

CB: Yes, we have with Google, Facebook and Microsoft. Within the 18 focus brands we have three global [brands] and if we can use our scale as a global company and leverage their scale as global companies in a no-barriers technology world, why wouldn’t we? For example, for the FIFA World Cup, which is a global event, we worked with not only ESPN as a global sports carrier, but also with Microsoft, with Yahoo and also with others to take over entire home pages around the world.

I think for anybody that has global brands or multi-local brands that can benefit from the same insights, why wouldn’t you do it. I see no reason to be afraid of those deals. They can be complex to put together, so the message needs to be simple. 

FC: Are they getting easier to set up?

CB: The negotiations are increasingly better. I say that because the digital giants have started to organise themselves better and understand that if they want to cater for the needs of global companies, they need to have global account directors, global structures, decision centres that are easy for us to reach and that have the authority to make things happen in their local countries.  

FC: What is the role of brands in social media environments such as Facebook?

CB: What most brands are learning is you don’t use it as a push medium. Brands are allowed to be there, as long as they play by the rules of the environment. That’s the way we like to treat it. So again going back to the principle of organising around people; if we start to use [social media] for blatant commercial purposes, then the self-regulation mechanism of the community will push the brand out very quickly. 

For additional content from this conversation with Chris Burggraeve, visit cmoworldtour.com and wfanet.org.