Creativity & Consistency: driving growth for the worlds largest beer brands - Marcel Marcondes

0:06Ladies and gentlemen, welcome back to the Unsentered CMO. And in this episode, we're going to talk all about beer with somebody that really knows their stuff. Marcel Macondes is the Global Chief Marketing Officer for AB InBev. Now, they own an astonishing eight out of the top 10 most valuable beer brands in the world. Not only that, but Marcel has won many awards, including Global Marketer of the Year. So he's the perfect person to find out not only how you market beer, but how you become a very successful CMO and what are the secrets behind it. So here it is. So Marcel Marcondez, welcome to the Uncensored CMO.

0:41That's great, John. Super happy to be here. It's great to have you. Now we're recording this just after Super Bowl, which is pretty exciting. We'll get into talking about that a bit later, but I first love to know, how did you get into this role, into marketing, and how did you end up running the biggest beer portfolio in the world? I always loved brands. I always loved marketing. I started my career at Unilever, which was a great school for me. I spent eight years almost at Unilever managing all the different shampoo brands you can possibly imagine. So almost eight years doing shampoo brands.

1:13Ask me about hair. Then at a given moment in time, I got a phone call with a very sexy offer to join ABI to run beer. And then I was like, OK, I mean, after all this point, like it's a good exchange from shampoos to beer. I'm in. I decided to jump. And then I joined 20 years ago. I joined ABI 20 years ago. And it's been great up to this point. Like I've been learning a lot in multiple different ways. So first thing, as I joined ABI, what makes me absolutely in love with this company is its culture, a culture of meritocracy, a culture of ownership. I really love it. And this is why I've been here for 20 years.

1:51But I have to say at first, once I moved from one company to the other, I'm a human being, like you feel the change. So it was a very important thing for me to learn on how to get into a different culture and adapt. It was very important in my learning process and development. Then my first challenge at ABI was interesting because it was about managing the biggest brand in Brazil that was in decline. So my first challenge was already to work on a turnaround, which was damn hard. But again, amazing opportunity to learn, to get a thick skin and to move forward. Then I spent four years in sales. I got invited to join sales and it was the best thing I've done.

2:30It's absolutely crucial to really understand the business in details and to be in the sales operation for a couple of years. After that, I got an invitation to move to New York back in 2014 to run Corona as a global brand and a few new strategic projects on Nonao and B &B. It was awesome because it was another layer of learning and development to really have a global scale. was something really impactful and really, really important for me. Then after a couple of years doing that, I got a dream job invitation to become the CMO in our U.S. business. So I grew up watching the Super Bowl spots at the Reels.

3:08I grew up with WhatsApp. I grew up with the real man of genius. So to have the opportunity to run marketing in the U.S. was very humbling, and it was literally a dream coming true for someone like me. And I spent four years, five years actually, in the U.S., working with the commercial teams there. It was a dream coming true. It was a gigantic experience. And then after that, Michel Duquerres, which used to be our CEO in North America, he became the global CEO for the company. And then I got the invitation, which is dream job number two, even beyond imagination to then become the global CMO of this amazing company, having the privilege of running the portfolio of iconic brands we happen to have in this organization.

3:50So I'm living the dream. Amazing. Now, for those who don't know, I mean, you manage a whole number of the world's biggest beer brands, don't you? If you were to go down the top 10, there's quite a few of them that's under your wings, aren't they? Oh, yes. Yeah, this is why I said it's a big privilege and also a big responsibility. We own eight out of the top 10 most valuable beer brands in the world. And by the way, Corona just became the number one in 2024, Budweiser number two, but eight out of 10. Also, we have$20 billion brands in our portfolio in a total of 500 brands. So it's a very big and powerful portfolio.

4:27It's a big privilege. Least an obvious question. How do you manage that amount of brands? So what strategy do you apply to decide where you're going to put your investment? This is a great question, because we've been learning a lot in terms of how consumers interact with brands and how different industries behave. So simply put, what we see is that all over the world, you choose at any given market, there's no more than three, at max, five brands commanding real growth in that given market. So this is why it's very clear for us that we need to learn to play with focus. When you understand the consumer basket, the amount of brands that they consider and they purchase on a monthly basis, it circulates around the same number, from three to five max.

5:16So this is why we've put together a program that we're calling the Mega Brands Program. So it's a way to be much sharper on the portfolio strategy we apply on each one of our markets because there's no point on having just a global portfolio strategy, right? Markets are big and they're different. We need to have a global strategy, but that respects local nuances. So we have this mega brands approach. So we select the brands that have both scale and growth to be the leading horses for the next couple of years. And these are the brands that get disproportionate levels of investment and execution.

5:57It's much easier said than done, but it's been a game-changing approach for us in the way we organize our commercial programs. because if we have focus, we have investments, we have focus executions, we can have everybody connected and concentrated in terms of brand plans that become much more commercially integrated because we do fewer things better. And this is, in practical terms, a game-changing thing for the way we build our brands. Now, I noticed you won, I think I'm right in saying, FE's market of the year. Yes, I would attribute that to what we're talking about here, the mega brands and the mega platforms program that we've been implementing.

6:38Because I was wondering if that's part of why, you know, in terms of being effective. Yes. In the end of the day, it's all about effectiveness. Yeah. Right. So, yes, we're very happy to be the number one company. ABI currently sits in the number one position of the FE rankings for most effective marketers in the world for the three last consecutive years. And I really believe that a lot of what we're talking about is what's behind that. So what other behaviors or actions deliver that kind of effectiveness? Because that's quite an impressive track record, isn't it? Three years in a row. No, it is.

7:13And we have a very clear philosophy as owners. We need to be very ambitious because we're leaders, but we need to be very humble every single day to learn every single day. Because given the pace of change of things in the world, if you stop learning, you're happy today, you're miserable tomorrow. So within that aspect, like we observe those, we compare ourselves to peers every year exactly to understand the gaps and opportunities that we have. But anyways, going back to your key question, connected to the mega brands approach, once we have focus and clarity on our portfolio strategy, we also plugged in what we call the mega platforms.

7:53Because once you have fewer brands with a greater level of investments and commercial integration, We can afford to have bigger programs and more commercially integrated programs to activate those brands and to connect them with key occasions and with more consumers. So this is why we've been engaging with FIFA Club's World Cup, FIFA World Cup, the Olympic Games. For the first time ever, we were a global sponsor of the Olympic Games. Roland Garros, Wimbledon, musical events like Lollapalooza, like Tomorrowland, and you name it. But these are big moments that are always naturally beer big occasions.

8:35We're not talking about sponsorships. We're talking about events that are already connected to big beer occasions. You just mentioned Super Bowl. It's a big mega platform, right? But people are watching the games. People are watching the ads with the beer in their hands. So this is when beer is naturally part of those moments. These are moments that people love. And this is when people get together to celebrate, to have a good time. And this is where beer belongs. By the way, this is why I love beer as a category. It's a privilege to work with a product that participates in people's lives in those amazing moments.

9:10So this is why we've been investing behind those big moments. So people connect with their brands in a natural way, in the right occasions, and because they want to be there. Because they love those moments. We don't need to interrupt them. We don't need to fight for their attention. So when we put mega brands and mega platforms together as a combo, this is what I believe is making a big difference in the way we manage the commercial plans here, in the way we build our brands. And this is why I believe we are making strong efforts and we're improving the effectiveness of what we do. Yeah. Sporting occasions, you know, football and F1, for example, I'd imagine.

9:45But Olympics is quite interesting, isn't it? I wouldn't necessarily expect that. And that was Corona with your 0%, wasn't it? Yes. Is that a new strategy then to extend the brand into a new kind of sporting arena? No, thanks for the question as well, because I get excited when you talk about that. Exactly, because it was one of those moments. Like even like quick parentheses, like our purpose as an organization is, the statement is we dream big to create a future with more cheers. It's really what we have inside our veins. We really live those principles every day. So when we spoke about Olympics, we were like, imagine if we could be connected to the Olympics.

10:25Why? Because we are seeing the trends with non-alcoholic. We're seeing the trends with our consumers. And we have great technology to do really a superior level of non-alcoholic propositions. So we said, okay, we're about to expand Corona Cero. Corona is our leading horse globally as a brand, the number one most valuable beer brand in the world. we have a great liquid for Corona Cero which is also unique not only because of the quality and the technology but because Corona is better served with a lime so when you have a Corona Cero with a lime you're really having the perfect original Corona experience and then the point was non-alc gives consumers freedom of choice they can drink beer whenever they want because it's non-alc and then the point was Olympics seem to be a great platform for non-alcohol because there's so many games going on throughout the entire day.

11:22So depending on where you are in the world, you have games at 9 a.m., at noon, at 3 p.m., at 10 p.m. So it's a perfect launchpad for a global expansion of a non-alcoholic proposition. So we were like, this could be awesome. Dreaming big. But then we were in a room and it was like, okay, but it has never happened before. Beer was never there before. But it doesn't hurt to try. And then we reached out to the International Olympic Committee. We had a few great conversations with them. They are great people. It's not a coincidence that they're managing the Olympic Games the way they are, and they're being extremely successful.

12:00And then we got to a very good place where they saw, yes, that's exactly what we want to drive. It's a very healthy and responsible consumption. Beer brings a lot of the celebration aspect for the Olympic Games. So it was a clear win-win, and we decided to make this partnership for the first time ever. So it was a big moment that at first we said, yes, it's happening. But then we said, whoa, and now what do we do? Because we announced the partnership in January. And in June, the Games would start. We would have to produce the beer, to distribute the beer. Everything would have to be in market by May.

12:34So it was a big rush, but it was one of the projects last year, 2024 Olympics, that we will never forget. And the best part is just the beginning of a beautiful partnership. I think we win, the Olympics win, and consumers win. I hadn't spotted that you launched the beer at the Olympics as well. I didn't realize that it was time to launch the beer as well, was it? Yeah, we had Corona Zero at the time in a few markets. So we expanded during the Olympic Games to 40 markets. So it was a huge period for the brand expansion. So simply put, we were launching Corona Zero in dozens of markets during the Olympic Games.

13:09Yeah. Now, let's talk about creativity, because I noticed as well, creative marketer of the year at Cannes as well. So congratulations on that. Lots of awards. How important is creativity to delivering kind of the effectiveness that you talked about before on all the brands? A sip of a non-alcohol beer. Yes, this will help. A lot is said about creativity. And I think for us, it starts with having a clear point of view about how to use creativity the right way. And we believe that creativity for creativity's sake is not really our business. We are a beer company. We're not in the entertainment business per se.

13:45So creativity for us is means to an end. And we use creativity to solve business and consumer problems. I think this is the right way to use creativity because then people pay attention to what we do. They engage with what we do. And then it makes everything we do more effective. So that's the clear point of view we have about that. So having said that, we learned over the years that to do this right, we need to have a process. we need to train our teams on that process and we've been doing that for many years so that we can behave as an organization the same way anywhere in the world we have a process that is called the creative X we have a couple of steps in terms of how to judge creativity how to ask for creativity and most importantly how to use creativity to make sure it's used to solve business and consumer problems so that's what's behind everything we do And then it becomes a natural part of our commercial conversations because there's a clear role for creativity to play.

14:43And then, of course, we don't work for awards, but we shouldn't shy away when people recognize our work. And then, yes, we were very excited to become the Creative Marketers of the Year for the first time in 2022. And then I remember at the time they said to us, it's great, but no company has ever won it twice in a row in history. and then again we like to dream big we said let's see if we can do it and then it was really great it was a big accomplishment for the entire organization for the entire team to do it again in 2023 and currently abi is the only company in the world to make it two times in a in a row i do love your definition there of creativity there to solve business problems i think that's what many organizations forget they think creativity is for creativity's sake but actually it's always in service of a commercial goal isn't it and that's so critical to put creativity at the heart of solving business problems.

15:37Exactly, because especially in the world of marketing, there's a lot of conversation about the awards and stuff. And again, I think it's very healthy to compare companies, to compare brands, to inspire people on great work. But it needs to be great work that drives results. So we take people to Cannes, we take people to F's events, always to make sure that they get inspired. but always with that mentality of great work that uses creativity to drive growth. So whenever we celebrate these recognitions, it's pointless if it's just about that. Like in our case, what made this process both on effectiveness with the F's and also with creativity with Khan very meaningful is that if you take the two years we won Khan, for example, those were two years when we reached all-time high volumes, all-time high net revenues, and we grew brand power in our portfolio.

16:31as a company. So things come together. It has to be about means and ends. Yeah. Well, it brings me to my next question about credibility of marketing as well, because if you use creativity and you deliver the result, then the business is going to invest more in that in the future, isn't it? So what's your advice to marketers to kind of gain influence within kind of the organization and demonstrate, you know, the power that marketing delivers? I think you just said it all. Ultimately, what this process gives us is confidence to invest, because especially in every business that is designed to grow organically, which is our North Star, brands are inevitably the most important assets of any company that is willing to grow organically.

17:14So this is the means and ends need to come together to give confidence to invest because there must be believed that this will drive growth and shed prosperity in the end of the day. So this is exactly the process that we do now. we always talk about driving sustainable growth. And sustainable growth creation means top line, bottom line, and brand equity. Because this is what makes sure that we drive growth, that this growth is profitable, and that we do this at the same time as we're making our brand stronger to grow today and to grow tomorrow. So this is the one, two, three that we work with every day.

17:54this is what guides all my targets my personal targets my verbal compensation and the same thing applies to everybody in our commercial teams and this is how we play the commercial game which is in our being according to our beliefs the right thing to do something i think you do particularly well actually is is the is the consistency of your execution not that it's the same but you're very very consistent how you approach it we did a study recently that looked at kind of brands that are consistent in their creative ideas, consistent in their partnership with agencies, consistent in the way they execute.

18:28And what we've discovered is this compounding effect, that the more consistent you are with your strategy and execution, actually the returns get bigger and bigger over time. And I think so many brands kind of pivot every single year and change direction and so on. But I think you've been one of those portfolios that you can see the consistency coming through over many years. I'm loving this conversation because you're touching on a few points that are so crucial. And so I love what you said and I couldn't agree more. And to be very honest, we've been learning a lot on that area from our own successes and especially from our own mistakes.

19:04Consistency is key. And I think it's very common for us to make mistakes on that because we tend to get tired of what we do way before consumers do. I think it's a great insight that comes from self-reflection. And I think we're humans. So it's very common to have the effect of the new brand manager and the egos that want to bring a personal touch on everything or a change in a group or in an agency or something like this. So we're learning to take consistency to the next level. And I think it starts by us understanding what's our job as we're here. Sometimes people say, I own this brand because I manage this brand.

19:44No. You're temporarily in charge of this asset. and that is precious, the most precious thing we have in the organization. And by the way, in our case, managing the brands we manage, many times we talk about brands that have been around for hundreds of years. So our job is to make sure that we behave as true ambassadors of these brands, that we keep them consistent, and that we hand it over to the next recipient of the responsibility, having the brand in a better shape versus the way it was before. Consistency doesn't mean don't touch it, but it's different from saying change it. Brands are like people, they stand for something and it's okay to adjust how you articulate what a brand stands for over time, but they are what they are.

20:36And I think it's very important to learn from that. As I told you, we've been learning a lot from successes and from mistakes. And the best success case probably we have in our organization, we were just talking about Corona, being the most valuable beer brand in the world. It is not a coincidence that if you see what Corona does now, all over the world in our system, and if you see the campaign and the commercial toolkit from 10 years ago, it is the same. We adjust exactly the language, the words here and there, a few activation elements, but the key principles of this brand, they are the same.

21:15so without a doubt consistency plays very important dividends and and this is something that we all marketers need to take to the next level everywhere well the most one of the other examples actually is is Budweiser with Super Bowl advertising the Clydesdales it's incredible isn't it I mean although although you know you evolve the story um the consistent thread through that that is amazing in fact I was looking at some we've been rating every Super Bowl ad for the last 10 years based on emotional response and can you guess which is the most effective ad of all time on a database i don't know i would guess it's either puppies or it's the frogs bingo there you go you got it yeah yes okay there you go but i i did a search on our database uh last night looked at every super lab we've ever tested the maximum score all time puppy yeah puppy love Oh, that's great.

22:11Which just shows the power of like that consistent thing that people are familiar with, but there's a bit of a twist, beautifully executed, but it's just the power of knowing what your brand stands for, knowing the kind of, you know, association people have with it. Incredible. Yeah, that's great. It's another great example. Well said. Budweiser is the number one. It's the greatest winner of the AdMitter in all the Super Bowl history. It was great to see Budweiser in the number one position again this weekend. and yeah it's another great example about consistency you must be in quite an unusual position because you don't just have one brand in the super bowl do you've got like four i think this year didn't you yes you had four different you see had stellar buds but well budweiser bud lights and michelob as well yes so but it's a great example because we can talk about we just we were discussing here mega brands mega platforms which is our commercial approach to building brands.

23:06So Super Bowl is a great way for us to use it as a very tangible example. Super Bowl for us is a mega platform. Why? Because people care about it, because it's a huge beer occasion, and because people have a net, it's a passion point, right? So it's connected with the NFL, which is the number one sport in the country. So it's a passion point. It's a big beer occasion. Therefore, it's a mega platform for us. And we've been connected to the Super Bowl and to the NFL for decades and decades. So the point is exactly to bring our mega brand strategy to life. What we have here is a perfect representation of our portfolio strategy.

23:49It's not by chance that we chose the brands we chose to go to Super Bowl. So Bud Light is our number one brand in the portfolio and the sponsor of the NFL. Budweiser is all about consistency. The Clydesdales, like if you don't take the Clydesdales to Super Bowl, you will see millions of people on social media saying, where are the Clydesdales? It's a cultural element. It's a must. So Budweiser and Clydesdales, they're synonym to Super Bowl. Then you have Michelob Ultra, which is the fastest growing brand in the US and our key player in the Core Plus segment. And you have Stellar Toit, which is our premium brand in the portfolio.

24:27So we have the core brands, we have the core plus brand, we have the premium brands. So our portfolio strategy is perfectly reflected in our choices of brands that went to Super Bowl. There was actually a fifth brand on the regional media, which is Bushlight, that happens to be the number two brand in growth in the US as of now. So we actually had five brands, four on national broadcasting, one in regional broadcasting in Super Bowl. Well, as a soccer fan, it was quite fun to see David Beckham appear in an ad. Yes. Yeah, what was the thinking behind that? Because I think that scored brilliantly last night.

25:04In fact, on our System 1 scores, that actually came top of your portfolio. Oh, really? Yeah, yeah. Wow, that's great to hear. It was very good to see that. Now, it's a great story. It's a beautiful brand. It's a brand that is talking about consistency that comes from the 1300s. Yeah. So Stella Brewery was created in the 1300s. So it's a super special brand. It's the most premium brand there is. Like when you talk about quality attributes, it's by far the number one beer in the industry, Stella Trois. And the point is exactly that it has European heritage. It's a brand from Belgium. So first point, what does this brand stand for?

25:48As a premium brand, the whole point on Stella is to connect with people on what really matters. Because it's very easy for premium brands to connect with consumers through luxury and things that money can buy and expensive possessions. And what Stella stands for is actually luxury, is to have time to spend with what's worth more in life, which is to be with the ones you love. So this is why the tagline for Stella is for moments worth more. So you choose a beer worth more for moments worth more. That's the beer that elevates simple moments into meaningful moments. That's what the brand stands for.

26:30And then it's an European brand that is growing and that we are focusing on in the U.S. So it was important to have David Beckham because he plays this role of an European cool guy that drinks authentically and genuinely stellar that now came to the U.S. and that lives in the U.S. So he's the embodiment of that. And then as you start getting to know David Beckham, if you watch his documentary, you see that he's a family guy. He really enjoys and values those moments worth more. So he's a perfect ambassador for the brand. And then that's point number one. Then we work with GUT, the agency, to really put together this positioning for a moment's worth more, which was very well done to really bring to life the brand proposition.

27:20And then there was a third piece, which was the following. We were in a Stella dinner. We do a Let's Do Dinner event every year exactly to celebrate people getting together to have a meal with beloved people. And Matt Damon was there. Stella has a partnership with water.org and Matt Damon is one of the founding partners convergenceofwater.org. It's a partnership we have for more than a decade, providing clean water to countries in need so that people can have time to spend with their families instead of having to travel to get clean water. Anyways, we were there, and then he said, I love what you guys are doing with this brand, and I would love to contribute a little bit more with storytelling.