The 'Danish Way' - How Carlsberg won market share and created a blueprint for big brands fighting off challengers...

As we move into a new year, there's a big spectre looming over brand managers. Its a worry across all categories and has grown more urgent in 2018.

The threat of 'insurgent' brands is very real.

According to WARC's 2019 Marketing Toolkit, a global survey of CMOs, the majority of marketers surveyed are worried.

UK brand consultancy Brand Gym conducted a similar study in the UK in September, and found that according to 88% of marketing directors, smaller insurgents pose a serious threat,

At Mindshare, an end of year survey of our clients found it to be one of the biggest headaches Irish marketers are thinking about for next year.

This is a big problem that needs careful strategic thought and tactical smarts.

What's fuelling the threat?

There are a few important factors.

On one hand information about all brands is more readily available than ever so there's less risk to trialling something new. If you want to know about a new beer, hotel, brand of makeup or protein bar, there are thousands of reviews online. And of course e-commerce growth makes it easier to buy these new brands from anywhere in the world.

Also, while purpose has been massively overplayed, it's definitely true to say that some people are looking for more authenticity, naturalness and relevance in the items they purchase. Novelty is a big purchase driver for some. A distinctive cool new brand has a better chance than ever of breaking through.

Going back to BrandGym's research, they found that the biggest threat of disruption comes in FMCG.

This sounds plausible.

Just look at how Fulfil, Halo Top, Fever Tree and other craft beers, gins and chocolate bars have grabbed small amounts of a huge market.

Sure, the 'death of big brands' nonsense has been overplayed. It's far too easy to make the claim that 'millennials wan't authenticity and purpose' or 'people don't care about big brands'. That's horse shit.

But while the big fish are not dying, they are certainly being nipped at by hundreds of small piranhas who are hungry to take a bigger slice of market share.

What can the big boys do?

From eating big fish to acting like a pirate, there's been plenty of advice and books written about how challengers can win. There's been lots of business level advice from consultancies about how companies can avoid disruption.

But there's been less written about how large companies can use their brand and a smart marketing strategy to keep challengers at arm's length.

Diageo are masters at tackling this problem. Across their two big beer brands, they've taken two distinct approaches.

One is a portfolio play. This is about fighting insurgents at their own game with relentless innovation at scale and constant NPD to take up shelf space.

Diageo has been rapidly expanding their portfolio. Just look at the Guinness Open Gate Brewery and how many new beers have come from there. Or the launch of Rockshore and Hop House 13. These will never be mass brands like Guinness and Carlsberg. But they can take back some of the share of market and share of tap space lost to newer craft brands.

But the other option is what David Taylor of Brand Gym refers to as "renovating the core but with fresh consistency".

The importance of brand heritage

In 2017, Mark Ritson wrote an excellent piece about the importance of brand heritage and why it has a bigger role than most marketers imagine.

According to Ritson, in order to truly understand a brand, modern brand managers should "dig into the archives and study its origins, founders and history. It’s only with that new found understanding of where the brand comes from and why it was created that you can distill the magical brand associations that made it special enough to survive when almost all of its original competitors are long gone."

But even more importantly, he says that:

"the trick with most great brands..is to use history and origins to work out the brand position and then apply that position disruptively to the current consumer world of 2017. What worked for a brand in 1970 will surely not work today. But if we can identify and explicate the meanings behind that tactical success, we can re-apply them and come up with a different but equally successful execution today. Studying a brand’s history is not just about looking back, it’s also a way to understand where the brand is going."

Too often marketers fall foul of novelty bias. We get caught up in what's new and shiny instead of remembering the important lessons that have gone before. As people leave a company, knowledge about what a brand really stands for starts to seep away.

But an oversized understanding of your organisation's history and cultural identity is a huge competitive advantage. If customers also share this, it's an even bigger advantage. 

You need to use the past, put a modern relevant slant on it and use it to your advantage. This is not high falutin' purpose, but truly playing back to what the brand is all about. 

You need to remember the source of your brand authority and credibility, what its key associations and assets are and bring them to life in new ways.

In Kate Waters' brilliant chapter for the new book 'Eat Your Greens' she offers up a masterclass in 'brand building'. According to Waters:

"there is strong evidence that brands need to create distinctive assets (logos, end lines, visual identity elements) in order to strengthen memory structures and grow mental availability. Finding ways to reinforce or build on existing assets through imaginative repetition is where our focus should be in order to build strong and resilient brands."

This approach also chimes with Jenni Romaniuk's book on 'Distinctive Brand Assets' where she advises that all brands should build a famous asset palette and play into these assets regularly in different ways. Think Nike's swoosh, Coke's red, Lloyds Bank's black horse or Andrex's puppies.

Great brands build their assets over time and don't rip them up or change them on a whim. They protect and nurture the things that set them apart, then they benefit from the compound effect of this over time. 

In the alcohol category, they know better than anyone the power of constantly playing out your distinctive assets in different ways. Think Bulmers' trees, the black and white of Guinness, or Absolut's blue font. If you removed the brand name, you'd still recognise the brand.

This is not to say that brands shouldn't evolve. The take away from all of this is very clear clear. Don't need to reinvent the wheel. Build on what you already have. Don't throw the baby out with the bathwater. But make it modern.

That's what Carlsberg did.

The Danish Way

When you think of Carlsberg, you think of very clear brand associations - Denmark, 'probably', the colour green, the bottle, the amber liquid. The brand has worked hard to build memory structures.

The challenge was how to make the brand more relevant and premium, while still staying true to its heritage. How can a big beer brand make itself feel modern and relevant but retain its links to the past and not throw away the reputation it has built? It's a tightrope.

But Carlsberg had an answer.

In 2017, the brand launched a huge integrated campaign dubbed 'The Danish Way'. Using Danish actor Mads Mikkelsen, the campaign focused on the brand's key assets - its Danish heritage, 'probably' and of course the green bottle, but with a slightly more serious, premium and modern slant than previous spots.

Going back to Ritson, he wrote another excellent piece this week on the power of brand codes and the need for better branding:

"Most ads are a total waste of money, not because the media choice was flawed or the creative was poor but because almost no one knew the ad was from the sponsoring company." 

Carlsberg clearly knows its 'brand codes' (logo, colours, country, tagline etc) and the value of using these to create ads that are both interesting/attention grabbing, but also strongly branded rather than generic.

The media mix was focused on brand building and integration rather than too tight targeting. Carlsberg using every channel in the most effective way to build reach and awareness, playing on their asset palette but bring them to life in different manners.

The majority of media investment went into TV. but the brand also brought the creative to life on social with bespoke assets, in experiential and in outdoor.

And it turned out to be a superbly consistent brand property that has remained for two years. Carlsberg found a myriad of different, clear ways to bring it to life and build mental availability. That's the force multiplier of a clear creative platform.

Rather than moving away from its archetypes, they played into them but crucially made them relevant for a modern audience - premium, slightly darker and slicker.

And of course, they've created a new brand character too, giving themselves another 'distinctive asset' to build on should they wish.

System 1 Research have done an immense amount of work on the power of what they call 'fluent devices' or creative conceits (slogans or characters) that are used as the primary vehicle for the drama of a long-running campaign. They've found that long-term campaigns with fluent devices are 23% more likely to achieve market share gain and 22% more likely to achieve profit gain.

This approach is clearly profitable, and with 'The Danish Way', Carlsberg have used a strong central character, wrapped in their brand's distinctive assets combined with two snappy, memorable slogans ('Probably' and 'The Danish Way').

In my opinion, this is one of the best examples of a big brand tuning up its history and asset palette and fighting its corner without diluting itself.

It seems to be working too. Carlsberg exceeded its profit forecast in 2018, with operating profit growth of 10% to 11%. Of course only some of this can be put down to marketing. But the approach looks to have helped sales in a fragmenting market.

The way forward for big brands...

So what can we learn from this?

Big brand marketers start 2019 with a sense of trepidation. There's a fear of category insurgents, the speed they can move at and the freedom they have to market themselves. But big brands tend to forget that they also have huge advantages.

The way forward is clear.

Fight unfairly. Use your strengths like built up brand awareness, your distinctive asset palette and your strong mental availability. Use your brand codes with pride and unsparingly. These are things newer brands either don't have or have little amounts of.

To bastardise a famous quote,

"those brands who remember their past are destined to lean upon and benefit from it".

It's a simple but remarkably effective formula for big brands fighting off category challengers:

1) A sharp, fame driving, brand building idea...

2) that's played out in multiple broadcast media to a mass audience...

3) using a tight creative platform that leverages the brand's heritage and assets but in a modern way.

Shane O'Leary

@shaneoleary1

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