The Future-ready CMO 2021: Take care of your people first, says Mastercard's Raja Rajamannar
The global CMO of Mastercard, Raja Rajamannar, speaks about everything from preparing for crises, befriending finance folks and winning in a brave new world where algorithms rule to Quantum Marketing, which is the title and subject of his new book...
Delshad Irani
Updated: February 10, 2021, 12:49 IST
Brand Equity kicks off 'The Future-ready CMO' 2021 series with a conversation with Mastercard's global chief marketing and communications officer, Raja Rajamannar. In an in-depth interview with BE, Rajamannar, who is also president of Mastercard's healthcare business, talks about the defining pandemic-era trends and the great technological disruptions which will force marketers to reimagine every interaction with consumers. He also speaks about marketers' fear of CFOs, the death of classical marketing and the birth of 'Quantum Marketing', the reign of algorithms that think and choose for us, the data-privacy dilemma and a "priceless" lesson from 2020.
Edited for length and clarity.
How have some of the key pandemic-era trends informed your marketing and business decisions?
First, I'd like to go back three years when we were trying to do scenario planning. Back then, one of the ideas that struck me was that most of the marketing departments do not look at risk as a complete function with marketing. So we created a risk mapping and management function for the first time within the marketing department and I asked my previous CFO to head that area. We never knew how useful it was going to be, to the full extent, that is, till Covid-19 happened. Because we had all the building blocks of how to mitigate risk and how to react when any risk actually materialises. We could just immediately switch to the crisis management mode without missing a beat. Sometimes you prepare for something hoping it will not happen, but when it does happen you are fully there.
This is a time when people are in a turbulent and very vulnerable kind of a scenario. Your clients, their customers and end consumers, you don't want to sell things to them, you want to be of service. This is not the time to sell, it is the time to serve. For us that was a huge attitudinal and philosophical shift during the pandemic.
Next, never go dark because these are the times when people expect brands to show up. And finally, I would say, not to fall into that sea of sameness where everyone says the same things because it's topical - whether it's Black Lives Matter or healthcare workers. The key thing is not to be politically correct but to be brand consistent. Find your true north and bring that to life in an authentic, consistent and sincere fashion.
In these moments of crisis, if you do the right thing by the consumer you will have their long-standing trust.
Most CMOs and marketers see the CFO as a foe. You don't. Tell us more about how you have cultivated a relationship with your CFOs and why a finance function is embedded in marketing?
Marketers tend to seem to be in their own la-la land. It's not that la-la land is bad. You need to have your head in the clouds and have that creative and intuitive kind of trait in you. But if you are not able to connect the dots between your marketing actions and business outcomes, the whole system loses patience and they wonder 'what are these guys doing?' Are they doing some flaky, fluffy stuff on the outside or are they mainstream within the company driving the company's results? When you ask a financial or numbers question to a marketing person they look at you like a deer caught in headlights. That's not confidence inspiring at all.
When you open your doors to the finance folks and say 'I would like to have a marketing CFO reporting into me and also the CFO of the company', it immediately brings a sense of transparency. Because what you're saying is that 'I have nothing to hide.' It's not a private territory or a turf. And if any question is asked of me as a CMO I have my numbers at my fingertips. I am able to clearly say this is what we spent and this what we got in return. You have to speak the business person's language.
This has really helped build credibility for the whole function. In today's world this is a model that I strongly advocate for CMOs. Don't feel insecure about finance and things like that. Embrace it.
Quantum Marketing, the title and subject of your new book - what is it exactly?
At the start of the pandemic, when I was thinking of putting together all my learnings from over 36 years in a book, I was wondering what the theme of the book would be and suddenly, because I'm a trained chemical engineer, I went back to science. If you look at physics, what is it? It's a science which helps you understand the physical phenomena around you. Classical physics worked brilliantly for centuries. But when mankind discovered outer space they found that classical physics was not enough. That's exactly what's happening with marketing today.
Marketing has stopped working the way it should be working. There have been so many changes - whether its technology, data or culture led, marketing is already faltering very badly. What is ahead of us is an extraordinary time of unprecedented disruption and classical marketing is just not going to work there. I say we need to reinvent and reimagine marketing for this brave new world. So quantum marketing is to marketing what quantum physics is to classical physics.
When I started looking at every single concept that is practised in classical or traditional marketing I said 'oh my god! This is outdated.' We have to reframe, rethink and, in some cases, we have to shed them altogether.
So what are some of the key points in the playbook for marketers in this new paradigm?
The whole marketing process starts with consumer insights. My premise is that we should actually have 'human insights'. Companies have to start looking at the entire pie, the whole human life as opposed to one particular consumption area. You think it might be obvious but it's not. 99.9% of all the studies are about consumption. We need to change that.
I'll give you one more example. Look at the concept of loyalty. As a marketing community we spend billions of dollars on loyalty programs. I came across an interesting study on BBC.com that said that a vast majority of people, 3 out of 4 people, in their personal relationships cheat on their partners. Now I'm not here to make a value judgement. The point is that a vast majority of people are making an explicit or an implicit commitment to their partners and they are aware that there are going to be consequences of not being loyal to their partner. Whether it is reputational, financial or emotional consequences, there are a lot of negatives, right? In spite of that if they are not loyal to their partners why would we as marketers expect them to be loyal to us? Why are we wasting so much money?
It is not that loyalty as a concept disappears altogether. You want consumers to use your product of your brand again and again. But there is a completely different approach. There is no point in building loyalty platforms. You have to rethink it as how do you win every single interaction on its own. We need a totally different mindset and a totally different architecture to enable that.
What do marketers need to do today to future-proof their brands and business?
There are some incredible technologies that are coming which will make entire operations amazingly effective and efficient. For example, artificial intelligence (AI). They need to understand first what it is because everyone drops the term AI but when you scratch the surface the understanding is very limited. They have to educate themselves very rapidly and start getting their toes wet in artificial intelligence because that's going to probably be the single biggest disruptor.
Digital experiences have become very critical. You cannot have a two dimensional ad in a 3D environment. So you have to rethink how you craft your messages.
The point is you have to really quickly, fast and furiously think about how you are approaching every aspect. That's the way you can stay ahead of the game. And to do this you need to learn and train your team. This is the time to encourage your team to learn. It's very critical.
Going forward, accountability on marketing to drive results is going to be humongous. So you have to understand your ROI. It is shocking that a vast majority of marketers still cannot give you a reliable and credible return on investment they are making. They have to build models to make sure that they are able to justify to the business what is happening.
And lastly, brand building may not necessarily be on the agenda of many CEOs or of many companies. But brands embody values and consumers are looking for trust in a brand. You really have to invest in the brand. Whether the company cares for it or not, you as a marketer have to and you have to really evangelise the brand in your company.
You are very excited about new technological forces of disruption like AI. But as more and more of us delegate our thinking and decision making to machines, what do you see happening from a marketer's vantage in the reign of algorithms?
Algorithms control and decide our fate. Search engine optimization and search engine marketing have been there, it's nothing new to marketers. But that is now getting to a different level altogether.
When you talk of IoT, one of the areas that you've got is smart speakers. In countries like the US, the UK, Germany and Japan, the penetration of smart speakers has gone beyond 25% of all households. In those kinds of settings the entire interaction from product discovery all the way to purchase happens purely from the medium of voice.
Now, even if you have a great brand logo and a great brand identity, how do you adapt your assets to an environment where there is no visual real estate and everything is voice based. At Mastercard, for example, we came up with a sonic brand. Sonic branding is not just a jingle or some cute sound. There is neuroscience and the science of music behind it. So you bring that and you have to show up.
Today, when you say 'hey Alexa, I want to buy diapers for my kids', Alexa will recommend something to you. As a marketer, if my brand of diapers is not recommended I'm completely out of the whole purchase process. I don't even have a chance in hell. How do I win this space? We now need to learn how to communicate with that algorithm which is driving those choices for consumers and influencing their decisions.
It is machine-to-machine selling. The selling machine will actually tell Alexa or Google home and convince it so it really surfaces on top of their algorithms, and those in turn serve up the offerings to the consumer. What you have is a new intermediary, a new influencer for the purchase decisions. That's scary and exciting. But it's the reality we have to wake up to and manage.
Today people are more aware of their privacy while companies are getting increasingly sophisticated tools to track consumers and to extract an unimaginable amount of data. In this battle between data and privacy, what do you see happening and how should marketers address this dilemma?
We are surrounding ourselves as individual consumers with devices all around us to make our lives better. Each one of these devices has got some kind of sensor which gathers data. It's not just gathering data to be intrusive. It's trying to gather the data to be able to make an offering to you that's relevant and useful. But the fact is there is data floating around.
As a marketer the first thing I have to do is think like a consumer. How would I want my data to be used? What would I like to know about my data usage? What rights do I have and what controls do I have to make sure that my data is at the right places and is being used for the right things? And if I don't want it I should be able to turn the spigot off. That as a consumer you would want to have. These principles are embodied in GDPR in the European Union or in the California Consumer Privacy Act. But I think as marketers we have to self-regulate and respect our consumers. That means you have to have privacy by design. You need to be very transparent. Don't throw reams and reams of pages of fine print at customers. That's not the way we can approach the upcoming paradigm.
Secondly, marketers have to be responsible for the data. How are you collecting data? How are you storing it? What do you do to make sure there's no breach? If you as a marketer are using third party vendors to manage data, your accountability doesn't end just with the data that is with you.
You need to have a complete and comprehensive approach toward data protection. That's very critical with an idea and philosophy of protecting and respecting the privacy of the customer. I don't think there should be any compromise on that.
Do you read the T&C?
Absolutely not. Who does? Unless you're really geeky about it, which consumer would want to spend even two minutes looking at all the terms and conditions. It's basically something that's not very consumer friendly.
As we go into this next stage of evolution of marketing, you will see some significant changes happening in that space, either with government-led intervention or with self-regulation. Collectively as a community of marketers there is more and more awareness and realisation and awakening of that responsibility in a big way.
Do you see marketing as an art or a science?
It is both. In the past the art component was huge. I talk about marketing evolving through various paradigms, we are about to enter the fifth. With each passing paradigm the dose of tech and science into marketing dramatically increased. In the fifth paradigm of marketing, data and science are going to be the two engines that will propel us forward. But they will also democratise everything. The same technology will be available to everyone. So how do you differentiate in a highly democratised and commoditised world? That's where the art comes in. You have to be creative. You have to bring creativity to life in these new kinds of contexts.
Never compromise your creativity, intuition and judgement. If you ignore the art aspect, you will just be in the sea of sameness because everyone will have exactly the same access to all the stuff you leverage on science, technology and data.
What's your one "priceless" lesson from 2020?
Business always comes way down compared to people's lives. In a competitive environment you tend to forget it.
People have vulnerabilities and they have problems, which really get spotlighted in times of crisis. When you stand by your people it makes such a huge difference to their morale and to their sense of wellbeing.
Kudos to the CEO of Mastercard, at the time it was Ajay Banga (now he's executive chairman). At the start of the pandemic when people were scared and anxious, he came on a webcast to all employees and said 'hey guys, just don't worry. We are here for you. Nobody will lose their job this year because of Covid." That was in March last year. You won't believe the amount of good it has done to people's sense of wellbeing.
Two, we adopted a very flexible lifestyle early, before mandated lockdowns. This flexibility tells you that you are walking the talk and not just making a politically correct sound byte. People will see through you if you're faking it.
You live the reality and express very sincerely that you understand and that you are with them. I made calls to my people and asked my leadership team to do the same, just to let them know that 'we are here for you'. 'If you are worried, scared or anxious in the middle of the night, call me. I'm here for you. Don't worry about waking me up.' And, if they do call, better take the call. Just don't say it because it sounds nice. Be with them. When you do that people will give their best to you in spite of the environment. And that's a blessing.
Take care of your people and they will take care of the business.
Watch: BE Cafe: Musings on the Future-ready marketer
Also Read: Redefining consumer engagement in post-Covid era for FMCG brands
Raja Rajamannar
Digital experiences
Brand Solution
Ajay Banga