Diego Scotti, EVP/CMO at US telecoms giant Verizon, speaks to Anna Hamill, WARC’s Senior Editor – Brands, about the guiding light of brand values, the need for marketing agility, and the importance of continued investment in advertising.
Find out more about Marketing in the COVID-19 recession in the latest WARC Guide.
WARC: We're now a few months into the COVID-19 pandemic. What have been the major lessons so far from a marketing perspective? And how are you approaching the next phase of the crisis at Verizon?
Diego Scotti: We embarked, a few years ago, to really solidify the purpose of the company, the values of the brand, and how we behave as a brand and a corporation. I never thought that those things would become so useful as for this time of crisis.
When you get to times like this is when I think a lot of companies really lose their way, or start making it up as they go, because they don't have a clear “North Star” to take them through a crisis. Very early on, it was relatively easy to focus our plan. We're focused on two things that are critical: our purpose, [which] is we create the networks that move the world forward, and our brand values of trust and innovation.
What's the biggest learning for us? It's been a couple of things. Number one: focusing on our strategy. Don't try to create new strategies or new purposes. That's why since the beginning, we said we're going to focus on being truthful and being helpful.
WARC subscribers can read about Diego Scotti's views on how social networks can tackle hate speech, and win back the trust of advertisers, by clicking here.
The second one is that to move fast during a crisis like this, you will have to figure out changes on governance that can allow that. We were able to really move at a speed that was informed by what's happening on the field, but also make decisions very, very quickly.
WARC: A number of really large brands, which have traditionally been quite bureaucratic, have discovered that they can be very agile under pressure. In terms of your marketing processes, have you learned anything from this crisis about doing things in a more agile way?
Scotti: Verizon implemented a weekly polling of our customer base – consumers and businesses – around not only our response to the crisis, but also the perceptions of people related to telco [as a category] and what telco brands were doing, which was extremely helpful.
We were the first brand in the US to have a TV spot with a message around COVID-19 and the performance of our network. There was a point that I couldn't watch any television, because every other spot was [saying,] “We're here for you.” We started with those things, for the first one. But we were also the first [brand] to stop, and that was because of the data that we had.
Then, [we had] a focus on action. The thing that I've been really talking a lot about with my team is that we've entered the point [where] I think people are so tired of being marketed to. I think the problem with a lot of marketing strategies right now is you want to convince the customer to feel a certain way. People are in a different mindset. People are looking at what you're doing and the actions that you take.
We decided to take action on three specific areas. The first one was giving extra data for kids to be able to study from home. Second, we needed to support first responders, so we provided more than $50 million in support for first-responder organisations.
The third one was small businesses. You’ve probably heard about #PayItForwardLIVE, which was a series of concerts that we did virtually for a series of ten weeks. And the focus was on: how do we get help for small businesses? The magnitude of the crisis was so big that, even if we gave money, which we did, it’s just a little contribution. What we said is, “We have to mobilise people to go and shop in small businesses.” And after the ten weeks, we had 85 million people … come together. Every week, we would get six, seven million people watching this [content], and saying things like, “Go and do something for small businesses,” with 90% of them taking action.
So that's an example of not only moving fast, but also focusing on the actions that you take as a brand. That, to me, right now is the new playbook of marketing. If you are a leadership brand, like we are, people are waiting for what you are going to do, not only what you're going to say.
WARC: You mentioned that you were the first US brand to go on the air with a COVID-related TV spot. Creating a TV commercial usually takes several weeks of work with an agency partner. Take me behind the scenes of how you put that together.
Scotti: It took less than a week. We have a very flexible model creatively. In our advertising, we use only real customers, real employees, and real engineers. So, from that perspective, it was easy, and we shot it very, very quickly.
I'm very fortunate to have a team and structure where people have been working together for a long time, and also have the right processes in place to be able to move fast. Behind the scenes, with the agencies, our model itself is very different from what a lot of companies do. We don't do big pitches … We have our central agencies and it’s almost like they are working at Verizon; that’s how close they are.
When situations like [COVID-19] happen, you can move really, really fast because they are understanding of the brand.
WARC: Around two thirds of brands are slashing their advertising spend in 2020 in response to COVID-19, either because they feel it's not the right time to advertise or because their revenues have dropped. What's your philosophy on advertising spend in the current environment?
Scotti: Our brand, what we do, and the product that we have are more important than ever. This is the moment for us to invest, not the moment for us to retreat.
In terms of the media mix, we have a very balanced media plan and a simple strategy, which is: we follow our audience. We don't have dogmatic beliefs. We construct our media plan in a way that is going to follow our audience and also tell our story. Our media plan now is probably 60% digital, 40% non-digital. We still do a lot of television, because there are a lot of people that we still encounter through that channel, and it also offers opportunities for storytelling.
In digital, a lot of people right now are confusing efficiency with effectiveness when it comes to a media plan. Everybody is just chasing efficiency. Efficiency is important – that's a responsibility in terms of return on investment – but, at the same time, you have to look for effectiveness. I can't build a brand story [just focusing on efficiency]. If we only look at efficiency, I would just invest in search, but I can’t build the story just by using search. So, it has to be a balance.
WARC: One of the trends that came out of the last economic recession in 2008 was a move towards short-termism and a focus on efficiency. Is long-term brand building at the forefront of your marketing approach at the moment?
Scotti: My philosophy – and I think this is also the one of the most difficult things for CMOs to achieve – is that you have to do both. You have to have a long-term vision and a strategy for the brand that you're going to pursue, and be clear about what that is. Then, the execution happens every quarter, every year. It has to be adapted to the conditions of the marketplace and also the conditions of the business. If your purpose, your strategy, and your brand values are not clear, then the chances of you being swayed one way or the other in the pursuit of long-term brand are going to be very, very high.
Our business is one of the biggest in the US in terms of retail presence. So, I see the sales numbers every Monday, and we make decisions balancing that with brand building. The issue for a lot of brands, and a lot of CMOs, is when there is a disconnect between the realities of the business and the brand-building strategy.
WARC: As someone who has a lot of marketing experience, if brands want to come through this economic recession in a position to grow, what are the foundational elements they need to understand and have in place right now?
Scotti: First of all, be very, very clear about what the brand is or what they want to be. I don't think this is the time to reinvent – maybe you need to recast who you are, but not change it [completely]. Second, I would say, lean on what's true and what's real about the brand. I think, now more than ever, people are wanting that.
That's the biggest responsibility that I think we have, because consumers now can really tell the difference on brands: they know who they are and if they are really coming from a position of authenticity and concern.
WARC: What changes in consumer behaviour during this time do you think will eventually end up being growth opportunities for Verizon, and the wider telco category, moving forward?
Scotti: I think there are changes that we are already seeing in terms how people are using technology to work differently, to play differently, and to connect differently. It's incredible. I think the opportunity around telehealth – when you start connecting data around and stats, etc. – is very, very powerful. Education is another category that, for us, is going to be a category of growth as well.
People want to be close to each other because that's who we are as a species. I think a lot of these new ways of using technology to interact will definitely be incremental ways to make our experience better, but I don't think that it will ever completely replace social, in-person interaction.