The Advocates - A global marketer with a passion for local brew
By John Tylee, campaignlive.co.uk, Thursday, 26 January 2012 08:00AM
Nick Fell, SABMiller's global marketing chief, may be in charge of a portfolio of brands covering more than 75 countries and backed by a £390 million adspend, but he believes beer is a local product that must be marketed locally.
For a moment, you think that Nick Fell, the global marketing chief at SABMiller, is about to lose it as he blinks to clear his misty eyes and stops in mid-flow to get his faltering voice back under control.
What could have got him so emotional? Surprisingly, it isn't the fact that his company can lay claim to being the world's second-largest brewer behind Anheuser-Busch InBev with an almost 12 per cent share of the global beer market.
Fell has actually been getting dewy-eyed about Transylvania. Not the mythical place where Dracula stalks but what he describes as the "Romanian Yorkshire", full of salt-of-the-earth types who value integrity and hard work.
But he reserves the biggest lump in his throat for the Transylvanian town of Timisoara. It was here that the 1989 anti-government protests began, igniting a nationwide movement that swept the despised Ceausescu regime from power and put an end to more than 40 years of Communist rule.
What's more, Timisoara also happens to be the home of the SABMiller-owned Ursus Breweries, the producer of Romania's most popular beer, Timisoreana.
Today, Fell is proud of how all of those local associations with heritage and strong moral values have been embodied in the TV advertising for Timisoreana. It features an empty barrel being rolled out of a bar and back in time through quaint villages and scenic landscapes until it is filled at the brewery where the beer was created.
As he explains, it's all about tapping into the national psyche and the widespread belief that, although lots of things have changed for the better in Romania, it's equally important that some things do not.
In the Czech Republic, where SABMiller owns the market-leading Kozel Premium, the brewer runs advertising based on the fact that "kozel" means "goat" in Czech. TV spots feature slices of Czech rural life in which the village goat figures prominently. "It's almost Hovis-like," Fell sighs.
In the UK, the company has been working to evolve Peroni from its traditional associations with pizza parlours. "We're now linking it with Italian style, and people get the message," Fell insists.
But he rules out any possibility of upping the ante with the launch of a UK beer. "We're very happy with our current portfolio," he says. "It would be hard to make a profit on such an investment and you have to understand clearly where any such product would fit."
The strategy behind Timisoreana, Kozel and Peroni epitomises SABMiller's global strategy of dominating the world beer market by promoting fast-growing regional brands that will appeal to customs, attitudes and traditions in more than 75 countries, and all backed by a global adspend of more than £390 million.
Despite owning Miller beer in the US and other names such as Grolsch and Pilsner Urquell, the company has no strong global brand. Even if a recent £7 billion bid for Foster's, the UK's second-biggest lager brand, had succeeded, that gap would not have been plugged. Fell is undismayed. "The idea that you have to be centralised to be successful is a Stalinist approach," he says. "It doesn't work in the real world so why should it work in business?"
It's a strategy that was largely forced on the company when it began moving beyond its newly democratised South African heartland in the early 90s and had to confront the fact that there was nothing in its portfolio of local brands that could be transformed into a global one.
"We were a large conglomerate in a small market," Fell says. "But we realised that the way the global brewing market was operating could be turned to our advantage. That's why we began acquiring businesses, particularly in Eastern Europe, whose owners couldn't make them work. Our experience in Africa told us that we could."
The result of all this is highly decentralised advertising and marketing arrangements. Ask Fell how many agencies are on his roster and he can't tell you. The company prefers to employ the best talents it can find and let them get on with it, he says.
"Many brewers look for global economies of scale - we look for global economies of skill," Fell declares. "That means trying to find out what will work locally. We take a global approach to evaluating and testing our advertising and everybody has access to their test results. We think that, by making our people fully accountable, we have a system that works."
Fell is playing for big stakes. As expansion opportunities via acquisition decline, international brewers must find other ways to build brands through organic growth, particularly in emerging markets.
Fell believes this trend fits perfectly with SABMiller's contention that beer is essentially a local product and must be marketed accordingly. "The beer business around the world has grown up around the chimney stack," he says. "That's to say that the place you built the brewery was the place you sold the beer."
And the argument for doing business that way remains compelling. Particularly since top inter-national beer brands such as Heineken and Corona Extra only account for about 1.5 per cent each of global market share.
Yet despite its devolved system of operating, there are global trends that the company is following. One is a decreasing emphasis on looking for growth in recession-plagued Europe, which currently accounts for 19 per cent of its revenue. Almost a quarter of it now comes from Latin America.
"Our business is reasonably well balanced across the continents," Fell says. "South Africa is where we were born and it will always be very important to us but the fact is that there will be more growth from the emerging economies of Africa, Latin America and Asia than from Europe."
At the same time, he is looking to evolve a profile of brands nicely balanced between local mainstream products and a growing premium sector. It's the brands caught in the middle that are being squeezed, he claims.
But premium brands don't mean brewers can take liberties with their prices, Fell warns. "Premium beer isn't like premium Champagne. It should be an affordable luxury. If it's seen to be beyond the reach of most working people, then it's never going to be a success."
It's an observation that underlines Fell's realism and dogged perseverance: "I'm a patient man who enjoys seeing things pay off in the long term. There are few overnight successes in the beer business."
THE FELL LOWDOWN
A friendly drink
Nick Fell has spent such a large part of his professional life marketing beer because of what he claims is a relationship between the product and its consumers that is almost unique. "Beer is a very emotional thing," he says. "It's like a good friend - and its links with everyday friendships are very close."
Food and fags
Essex-born and a Cambridge honours graduate in history, his long-standing interest in marketing took him first to RHM Foods and later to Philip Morris.
His entry to the drinks industry occurred in the 80s when he became brand manager for Glenfiddich in a joint venture established by Whitbread, Bass and JR Phillips. Subsequent career highlights have included spells as the Guinness global marketing director and global brands director for Johnnie Walker.
He took time out from the industry for a spell as head of global commercial strategy at Cadbury Schweppes and marketing director for Cadbury Trebor Bassett. He joined SABMiller in 2006.
This article was first published on campaignlive.co.uk
- Artworker Fashion & Retail Personnel Consultancy £23000 - £25000 per annum + Outstanding Benefits!, London
- Recruitment Consultant Michael Page Digital £25000 - £3000 per annum, Kingston upon Thames
- Senior Community Manager Michael Page Digital £25000 - £45000 per annum, West End
- Online Marketing Manager Michael Page Digital £35000 - £38000 per annum, London
- Client Director Michael Page Digital £50000 - £55000 per annum, Leeds