Fred Ehle on the Ever-Increasing Speed of Marketing

Mixing Board Studio Session

Fred Ehle is a B2B and B2C marketer, currently serving as an Interim/Fractional CMO at RoseRyan. He’s driven top and bottom-line growth at Fortune 500, private equity and privately held companies including McDonalds, Jockey International, Redbox, and PulteGroup. He’s built and grown existing brands and launched over 30 new products for companies like General Mills, Campbell Soup, ConAgra and SC Johnson at major ad agencies including DDB, FCB and Leo Burnett. 

In this Studio Session, Fred and Mixing Board Founder, Sean Garrett, talk about what it’s like to execute change within large organizations – and how to get people on-board with those changes, why it’s ok (and actually encouraged) to break the rules, how marketing is evolving, and the end of planning (?).  

SG: Tell us about how you got to what you're doing right now. 

FE: I started my career in big ad agencies in Chicago in account management, CPG businesses mostly. I pivoted for a brief time in consulting at the branding and design firm called VSA Partners in Chicago, where I led strategy and before that at the Zyman Group, back when Sergio Zyman was around, for anyone old enough to remember – he was the first Chief Marketing Officer at Coke, he would tell you the first chief marketing officer in history.

From there I migrated to corporate marketing, which is what I’ve been doing for the last 15 years. I started leading brand management at Pulte Homes, which was then based in suburban Detroit. They are the largest publicly traded home builder in the country. The CEO at the time was ex-Pepsi and he really understood the power of brand. When he eventually acquired Del Webb, he changed a Pulte branded community in Florida to Del Webb and their sales pace doubled overnight. It was like, "Oh, maybe there is something about brand, maybe we should leverage that."

At Pulte, I worked for a woman named Deborah Wahl, who became the CMO at McDonald's. She took me back to Chicago with her to be the Chief Customer Officer at McDonald's. 

At both Pulte and McDonald's, as I came in, the businesses were in decline, and we were part of the leadership team that started the rebound. In both cases, it's because we put the customer and the consumer back at the center of the business. Before that, especially at McDonald's, they were looking to lower costs because they were growing so well, they focused on margin and took their eye off of marketing. Then all of a sudden they had a bunch of competitors – all these specialty high end and even low end players were starting to take them on both ends. How do we get the consumer back in the center of the business? How do we get the brand relevant and culturally relevant with the consumer?

SG: McDonald's is not a small company. And I’m sure change is not done on a dime. How do you help enable a reset like that? 

FE: Steve Easterbrook (the CEO at the time) was the one that really lit a fire to everybody. He’s a finance guy, but one of the reasons he got the job was he turned around the UK business. Steve would always say that in a turnaround time is your enemy. He literally set the burning platform and told us that if we did nothing, we would continue to decline. He was all about customer centricity and digital transformation. He was all about breaking taboos because he had felt the organization had gotten too fossilized. He really led the way by just starting to break some of those taboos.

On top of that, the organization was bloated. When you let 2,000 people go, that tends to get people's attention. The combination of all that jump-started the organization, and suddenly things started to happen. He ran the playbook he ran in the UK very effectively.

It was that way at Pulte too. When I came to Pulte, it was 2010, two, three years after the housing implosion. At its peak, the company had 25,000 employees. I joined them at 3,500. When you see that kind of cataclysmic decline, what got you there isn't going to get you out of there. The excuse of, “that’s the way we’ve always done it,” doesn’t work when you're in that kind of a situation. You almost have to take some calculated risks to turn it around.

SG: In those moments people are often operating by fear. How do you instill creativity into those moments? 

FE: There's fear amongst some, but then there's opportunity amongst others. Because you are encouraged to do something different and to take a risk. You almost have to. Steve would say, "Look, we're going to be wrong, but we also may be right. We’ve got to do something different." Now there was the incentive and permission to break the rules. Some people take a truck and drive into that opportunity and some people run away. That's part of figuring out who's on board and who isn't. 

You also have to paint a picture of what is possible. Steve would explain that the reason we're doing this is to get back to a place where business is booming. He would talk about a modern, progressive burger company. Let's stop running the old playbook and let's embrace change, embrace technology, embrace what we have in front of us. I personally find that very exciting. Of course you can't be reckless. Both companies were making money, it's not like they were going out of business. They just weren't growing. If you make a data based argument around an opportunity, you test them, learn, and scale.

SG: Tell us more about your career journey. 

FE: I led marketing at Redbox after McDonald’s, until COVID hit and they stopped making movies. And most recently I was leading product marketing innovation at Jockey International, a privately held apparel company. When I left Jockey, there was an opportunity to get into the interim and fractional marketing space through a ZRG Partners subsidiary company called RoseRyan, that did interim fractional finance and accounting. They were very tech focused, Silicon Valley focused and getting a lot of pull from their clients to do interim fractional marketing. So I'm an interim fractional CMO on a part-time basis through RoseRyan right now while I look to go back to a B2C, ideally, PE backed company as a senior marketing leader. 

It’s been interesting to look at the interim fractional side from a marketing standpoint. For those of us that are in the ad agency world, freelance talent has always been part of the agency ecosystem. But it's really an interesting play, in this day and age, for early stage companies. If you think about VC backed, early stage companies, if they've got someone who's “been there and done that” and they can bring them in on a fractional basis, it enables them to mitigate against a ton of risk. These more experienced execs can come in on a part time basis and keep the founders from making some of the early mistakes that many people make. 

There seems to be an especially big market for it with B2B companies. Because they only need marketing at certain points of time – to help set the strategy and the marketing plan and then they can go to market and execute with their sales force, or however they go to market. With B2C companies, you've got to have a full time marketing capability because it is a strategic function for those businesses. The CMO is often the most important hire after the CEO and the CFO.

SG: How are you seeing marketing being roughly defined by C-suite leaders right now and what's it evolving into?

FE: Marketing has a marketing problem right now. This is driven by the fact that the discipline has spilled over into other disciplines – IT, data science, et cetera. What is the role of marketing? What do marketers do? What's a growth marketer? What's a performance marketer? What's a brand marketer? The C-suite that doesn't know what marketing is now. They look at digital and social and say: "This is something that's relatively free. It goes viral, it's measurable. Why don't we just do that?” They might think that they don’t have to invest in marketing and can rely on earned channels. They might not understand the whole suite of what is necessary, in order to drive a full funnel: it’s brand and performance.

Some of that funnel now has been moved over to IT or some other disciplines. CMOs are coming in with the remit to grow the business, but they're not necessarily given all the levers to do it. They're responsible for it, but they may not be responsible for product or they may not be responsible for pricing. They may only be able to influence part of the traditional marketing construct. 

Even when I was at McDonald's, the CMO of McDonald's US was largely responsible for the advertising budget and creative, but didn't really drive a lot of Menu innovation and consumer insights sat somewhere else in the organization. That has since changed as marketers with a CPG background have since come in but that wasn’t the case as recently as 8 years ago.

SG: Is your view that the most effective CMO or marketing leader should have control, or at the very least have influence over product and the product marketing side? 

FE: I've done B2B and B2C marketing, and I’ve now come to learn that what leverage you're given as a marketing lead is going to be very dependent on the vertical that you're in and how you go to market. For example, sometimes the sales organization is separate from the marketing organization. Sometimes marketing is under sales. When I came into Pulte, marketing was really sales enabled. It wasn't marketing, it was – give the sales people the tools they need to sell. For the more heavily regulated markets, financial services and healthcare companies, that adds a whole other level of complexity around what you can do, how you can do it, and how you can go to market.

I grew up in the old CPG, brand management construct, where the brand people sat at the center of the company. That was your path to being the CEO. The marketer was the cross-functional team leader for anything. That still only exists in CPG, I don't know that it sits like that anywhere else, to my knowledge. 

As companies look for CMOs, it's going to be about what are you asking that function to do? And as a marketer, you have to be really clear with leadership about what you are holding me accountable for and what I can directly control. Of course we all have shared commitments to an organization, but what are the things that can I directly impact? And to what extent is that going to drive growth? Versus being responsible for the entire spectrum of growth. 

SG: There's a lot of communications people in Mixing Board who interact with marketing folks, they either work on the bigger marketing team, sit next to a marketing team, and in some cases, sit above a marketing team. How do you see the interactions evolving between communications and marketing? Or do you view it as one and the same?

FE: I'm a brand person at heart. I would tell you the brand needs to sit at the center of the organization. There always has to be consistency around the brand, but there’s message variance for how that brand is expressed to different stakeholders and constituents. The question then becomes where does that sit? Does it sit with marketing? Does it sit with communications? It's dependent on the kind of company that you're at.

As a marketer, I’ve always found it really interesting to look at any company’s website, and read the “about” section. How do they talk about themselves? How do they position the company? That section is a positioning statement and a construct for the entire corporation. That typically sits within corporate comms, but if you think about it, that construct is really a positioning statement. That’s why there always has to be shared responsibility or accountability between marketing and comms around how we are positioning ourselves to our corporate stakeholders and making sure that it's not at odds with how we go to marketing against our commercial end users.

SG: If you were entering marketing now and your dream was to be a CMO of a big Fortune 50 company, what does your dream even mean right now?

FE: You definitely need to do a tour of duty in the technology side of the marketing function. It doesn't necessarily mean that you have to come up that way, but as a marketer, you need to spend some time on the tech stack, on the data analytics side, and on the performance side for sure. If you come from that side, then you need to do some tour of duty over on the brand side. Because at the end of the day, you need to have both brand and performance. It's not an either/or, it's an and. Corporate America is starting to realize that you’ve got to have both. You've got to fill that top of funnel with new consumers, new users, and the only way to do that is through brand. You can't just sit at mid/bottom funnel.

You've also got to think about how the brand is expressed in all touch points – through PR, internal communications, everything. We just have more channels to do it with now than we ever have.

SG: What organizations have done really interesting brand work, that was clearly performance influenced and/or performance work that was very clearly brand influenced? Because we do separate these things in a lot of different ways, but they are inextricably linked together. Any good examples that you’ve recently seen? 

FE: The brand that comes to mind immediately is Walmart. Walmart does really nice brand work, especially during the holidays. They’re getting people into the store, getting them into the funnel. Target is another one that does a great job. Retailers are just inherently in that world, what we used to call it branded promotion and now it's branded performance. 

SG: And those are not two different parts of the HQ?

FE: Those teams are not siloed, that is for sure. They are definitely united. I'm certain those teams are both united underneath CMO. 

SG: What happens when there are those silos? I've always just thought it’s ridiculous how this stuff does get siloed. Even in companies I know that started off with literally three people in a room, fast forward five years later, there's five different rooms that everyone's in doing different things. Why is this?

FE: Sometimes, as marketers, we'll silo ourselves. We’ll say, “I only want to be doing marketing communications.” There are some marketers that don't even want to be involved in product or the pricing. I always encourage marketers to better understand the business. You have to better understand the business strategy. Understanding how the organization makes money is ultimately what you are supporting and driving. Don’t just sit around waiting for the brief. 

At McDonald's, because they're so big and the scale is so massive, they have a functional discipline called Alignment. Their job is to align the three-legged stools of the company – supply, suppliers, and the owner-operators, for just that reason. There'll be people sitting in meetings and then they communicate across audiences to anyone that needs to understand. That's how things get done on a scale like that.

For smaller orgs, it's incumbent on the senior leaders to break those silos down. I have found, in smaller and mid-size companies, the people that get things done, because ultimately that's what you're measured on, are those that are the connectors across. They're willing to work in cross-functional teams or make sure that they go across the hall to talk to their counterparts in IT or finance. 

SG: Where does technology, and AI specifically, fall into the consideration set as these functions are being merged or sat back next to each other?

FE: I've been thinking about AI in terms of the immediate implications and applications. Obviously there's the content side of it, the ability to do at least the initial content generation through AI, which is a cost savings potential. But then you start to lose control over that technology because it doesn't generate exactly what you want, along the prescriptive brand guidelines, et cetera. So, to what extent do you put the critical thinking in a human person over that?

Then there's the brand safety side of it, in terms of bad players that can use AI and generative AI to denigrate your brand, if they're out in open environments like that. Brand safety is already a concern in the digital world, especially with social media. Throwing the AI component on top of that – how do I know if that's really coming from McDonald's or not? That’s something that keeps marketers up at night.

The other side of AI is the ability to do the data analysis – it enables you to look at different cohorts, different audiences, to segment in real time, to track activity engagements – it puts the predictive analytics on a whole other level and can make you smarter about what's coming. It starts to turn you into a real time, 24/7 marketer. If you're in a business as big as McDonald's that is doing 25 million transactions a day in the United States alone, just think about what AI can do to enhance your ability to track, understand, and participate in consumer engagement.

When we were looking at Web3.0 and the metaverse, I didn't understand how they were going to scale and be as impactful as a lot in the industry thought they were going to be. But when I look at AI, it's more shock and awe. AI is not going away and it's going to get even more sophisticated, obviously, given the nature of the technology. What it can do is both breathtaking, both good and bad.

SG: Sometimes people think AI is about the output of what I'm going to get from it but really it’s the input of all the data into it, and what that tells you. To your Walmart and your Target example – it's not about just the performance campaigns they're doing, it's about what they're learning from their data, from all their different locations that they're then feeding into the campaigns.

FE: That's something companies have got to figure out, how much data do we want the machine to ingest and from where? And how much are we going to put out that someone else can ingest?

SG: On the brand marketer side of things, it's about the speed you need to operate in order to manage or think through that data that just came through that day or that week or that month. How should you rethink this plan you just had? And maybe don't spend that 10 million over there, just change it over to here.

FE: I could see a world in some industries, especially the fast-moving, retail consumer goods, where there's no planning anymore. It's almost like day trading on the stock market. You're starting to dial the business on a weekly basis, maybe even daily basis in some cases. Think about the fourth quarter for a retailer, it could almost be a day-to-day management of the business as opposed to, "This is our marketing plan for the year and this is when we're going to do this." That's been long gone for a long time, but now maybe you may be doing either weekly or monthly planning and nothing further out.

There's got to be some sort of tenets, some pillars and some anchors, but then there's got to be a lot of flexibility on a daily basis. Like anything else, you’ve got to watch the trend list versus the systemic trends and try to suss out which is which, which can be hard to do in the moment.

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