David Blecken
Jul 31, 2013

Experimentation critical to good marketing: Diageo's Venky Balakrishnan

GLOBAL - Marketers need to work more closely with technology companies and be prepared to take a test-and-learn approach to everything they do, according to Venky Balakrishnan, Diageo's global vice-president for marketing innovation.

Balakrishnan is based in New York
Balakrishnan is based in New York

Campaign Asia-Pacific spoke to Balakrishnan at the Cannes Lions International Festival of Creativity last month.

What exactly does a marketing innovation head do?

Our function is different from product innovation. Fundamentally, it’s about finding new and richer ways of engaging with consumers. The division was formed to be upstream from the rest of Diageo. We experiment on a small scale and if that is a success, we take it out to the rest of the company. We exist to take advantage of new opportunities. Any inflection in a category creates opportunities. But if every brand [within Diageo] were to spend a lot of time doing [what we do], it would be very inefficient.

How closely do you work with technology companies?

It’s massively important to have a direct relationship with tech companies; many of them would call themselves our partners. One of the reasons is that these [platforms] have grown so fast globally that staying on top of it all is a full-time job. Things are changing so fast that we’ve realised that to go through the usual chain of specialists and agencies is not always the fastest way of getting things done. We’ve also found the need for wholesale raising of capabilities and sometimes learning from the source is fantastic.

We’ve also had a brilliant relationship, in the sense that many tech companies have grown so quickly that for them it’s not just a question of understanding users, but also geographies. As they’re trying to figure out how to work with brands, we’ve given them insights into markets we’re familiar with that they aren’t. It’s a wonderful give-and-take. Sometimes we become involved with very interesting things [that others are not privy to] simply because we are willing to jump in there and try it out.

Do marketers today really need to become ‘tech’ people as well?

I don’t sit in the IT department. I’m still a marketer. Everyone thinks it’s about technology, but looking at this area with a strong leg in marketing makes it a much easier bridge to people. Translation is needed for how the tech world does business and marketing does business. The consumer is the connection. Having this within marketing is really helpful for us, but technology is a means to an end. Sometimes it allows a richer means to that end; if not, you realise you’re just chasing a fad. We find ourselves making those mistakes, but coming at it from a consumer viewpoint really helps.

Some markets in Asia are obviously much more mature than others. Does this make it difficult for you to achieve consistency?

Our markets may be at varying stages of development, but I think technology is more borderless. It levels the playing field for us. We can start something in one market, then scale it because people are really using platforms in the same way. The internet doesn’t work in the way companies work; it works in the way consumers want it to work. I think consumers vary more in their drinking habits than in their technology usage. There are some cultures where people share more, there are unique local platforms… but if you look at what people are doing, how they engage with content, there are similar patterns.

Is the industry’s enthusiasm for content marketing justified?

It’s a massively important area. We have someone whose full-time job is to find the right content for the right screen. What you choose to engage with on a smartphone is very different to what you would on a tablet. We have to make sure it’s something people really want to watch and share. The rules of great content were the same before all this technology came along. But this is why we work absolutely hand-in-glove. The internet is the world’s biggest haystack. Even if content is great, it can easily just end up a diamond in that haystack. One role that technology has is to help consumers engage with content in the right way. Content needs technology as much as technology needs content, otherwise it just gets lost with all the other cat videos out there.

Does Diageo aspire to become a media company in its own right as some have done?

There are people out there for whom content production is their core business, but we prefer to work with specialists. We also crowdsource content. It’s about identifying the best partner depending on the kind of content you want to produce. We’ve spent a lot of time working with YouTube to understand what works on their platform. It’s physically impossible to be good at all those things all the time if you choose to do it in-house.

How comfortable are you with giving consumers control of your brands?

With all our experiments, we make a prototype into a working prototype and that becomes the basis of a pilot. When you build something, it’s no longer theoretical. The best way is to build something and put it in people’s hands. In my space, you get a lot of feedback, good and bad. If it’s mostly bad, you know you should stop. Suddenly you find you don’t need a 20-page PowerPoint deck. It’s there in front of people to play with. The world has come to a place where people are not expecting everything to be perfect all the time and as long as we acknowledge that, we can do things significantly better than we used to.

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