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Excerpt from ‘The CEO Factory’ written by HUL's Sudhir Sitapati


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We present excerpts from ‘The CEO Factory’ written by Sudhir Sitapati, Executive Director, Foods and Refreshment, Hindustan Unilever Limited, that was released recently in Mumbai. In the Preface to the book, the author says nobody gives more CEOs to corporate India than HUL (400+ according to his count) and proceeds to present deep insights into what exactly managers learn at HUL that makes them so much in demand as CEOs across the industry. The narrative about the company’s culture and practices is stitched together with fabulous anecdotes, highlighting HUL’s ‘middle class’ success mantra, and is peppered with Sitapati’s own learnings over 20 years, management lessons that he draws and – most admirably - brutally honest admission of his and the company’s failures. 

Advertising is the sexiest part of marketing. And it is different from everything that comes before in this book and from what will follow. It is the only part of business management where both the right brain and the left brain, feeling and thought, magic and logic, are equally used. Though it can be learnt up to a point, very few people have a natural flair for it. While many people in advertising agencies have a natural flair, they often lack a strategic business perspective. If you have both,
it is a serious competitive advantage.

While many of us may never make ads for Television, all of us find the need to communicate simply. Some of us need to take the help of creative people to communicate better – a house we must build, a book cover we have to design or indeed a birthday party we have to organize. But getting the best out of creative people can be a tough task.
The HUL approach to advertising is a great life skill to have. HUL spends about Rs 3500 crore on advertising and accounts for roughly 15 per cent of spends and 20 per cent of the country’s ads on TV (we buy much cheaper due to scale). Unilever believes that advertising is too important to be delegated. A senior person should lead the process from brief to production. That person can choose to consult with others or not. That’s her call. But ultimately in advertising, there should be one single decision maker, the advertising leader.
Over time, Taj had moved away from using Zakir Hussain as its ambassador to use more conventional celebrities like Madhuri Dixit and Saif Ali Khan. In 2013, just as I was taking over the tea category marketing in HUL, I heard two youngsters saying ‘Wah Taj’ when they spotted the santoor maestro Pandit Shivkumar Sharma at Mumbai airport. What a phenomenal memory structure to nurture! We moved Taj back to its old memory structure – classical musicians (in three subsequent ads we have used Niladri Kumar, Rahul Sharma and Nirali Kartik as our ambassadors) playing mesmerizing music to the refrain of ‘Wah Taj’. Taj advertising has suddenly become recognizable again and the brand has started gaining market-share after a decade.
The iconic Flipkart campaign is of two kids who look like adults, making e-commerce look like child’s play. In 2015, I was asked to become a member of the Flipkart Advisory Board. Flipkart had recently changed the ‘kids as adults’ idea for their ad campaigns. I remember telling Mukesh Bansal (who ran the company at that time) and the newly appointed CMO, my former Lever colleague Samardeep Subandh, to revert to the old concept. It was a brilliant idea to show how simple e-commerce was (even kids could use it) and more importantly it was the brand’s DNA. Samar, being an old Lever hand, thought the same way and the campaign went back to the earlier one. Harish Manwani recalls how HUL’s marketing guru Shunu Sen was in a meeting where managers were saying that everyone was using film stars and perhaps Lux should move on. Shunu said something on positioning that Harish hasn’t forgotten:
‘Anyone can use a film star but only Lux can carry it off.’ Brands become great because at some time in their past, even near past as the Flipkart example shows, someone has an epiphany or a lucky breakthrough. It is wise to distil this moment in a bottle and constantly take swigs from it. Brands that haven’t had this epiphany need to understand their role in their consumers’ life and constantly look for clarity and insight. The moment will come, sometimes sooner and sometimes later, but when it does, recognize it, and make sure you stick with it.

As a brand manager on Surf Excel some fifteen years ago, I would eagerly wait to see the impact of every new ad we made on sales. While most of the time nothing happened, I did notice a pattern in the successful ads we made. On our ‘mind measure market research’ where we asked consumers every month what they thought of our brands, a measure called Spontaneous Awareness (SPONT) would be most sensitive to good advertising. When asked to name some detergents, if 50 of every 100 people said Surf Excel, the baseline SPONT of Surf Excel would be 50. When we ran good advertising, we would see this measure move up to, say, 55, and then sales growth would follow. Good advertising made you more famous, and fame, also called salience, drove sales. Several subsequent studies within Unilever and of course Byron Sharp’s ‘How Brands Grow’ confirmed this early practical understanding of mine. The theory is as follows: The consumer doesn’t change the brand she mainly uses but is quite open to changing the set of brands she infrequently uses depending on whether it is at the top of her mind. You want a chocolate badly, your favourite Dairy Milk is not available so you buy a Five Star which you saw an ad of yesterday (even though you may not remember you saw it).
The interesting thing is that the overwhelming bulk of the purchases in every category are actually the infrequent ones.

If salience is so important in driving sales, how does one make salient advertising? The HUL way believes there are two factors – enjoyment and branding. Of the two, enjoyment is the more important. It doesn’t mean that you laugh when you see an ad. You simply must like seeing it again and again. So the heart of advertising is making ads that people like to see.
However, if people like to see the ad, but attribute it to some other brand, it serves no purpose. So branding is also important. But branding is not whether consumers recognize the brand logo. Quite the opposite. Good branding is being able to recognize the brand in the absence of the logo.
Callow brand managers fight with advertising agencies to put the brand logo on the top left of every frame or increase the size of the font. It either goes unnoticed by consumers or, worse, affects enjoyment.
It is not vital that the creative person should identify with the business target – and creatives do tend to be uninterested in it – though it helps. In general, it is better not to clutter the creative’s mind with your business woes. Broadly, creatives want to understand two things: who they should speak to and what they should say. The latter should ideally be one sentence, if not just a word. When it comes to who they should talk to, it is not useful to say ‘25-40-year-old women living in town, class 1-10 lakh, consuming Brooke Bond Red Label occasionally’. Instead try this: ‘Women who are unafraid to take the first step in building human relations.’ The creative person will automatically find someone they know who resembles this person and will make communication for that one bull’s eye target. An ad can do one of two things: it can be either eye-catching/attention-grabbing/memorable and drive salience, for example, Brooke Bond or Surf Excel, or extremely persuasive like Dove or Lipton Green Tea. If you are focused on salience you need to get a cracker of an insight. The insight is of course the heart of the brief. A contradiction obvious in hindsight.
For instance, ‘common ground is a cup away’ is a great insight for a tea brief. On the other hand, if you want to be persuasive, which is advisable only when you are building a category, you need a very compelling proposition or a promise. ‘Use Indulekha oil and grow back your hair in 4 weeks.’ A simple way of remembering this is that if you want to be remembered (as you should most of the time) empathize with your customer, but if you want to persuade her then formulate a sharp and relevant promise.
The advertising legend Piyush Pandey recalls a brief he received in the early 1990s for a new soap that HUL was planning to launch called Le Sancy. Le Sancy was designed to be a soap that didn’t get as mushy as regular soaps. The brief was a manual on how to make advertising on Le Sancy based on a successful launch in Chile twenty years ago.
The not-so-brief ‘brief’ contained everything from the size of the font to the TV script to which mediums must be chosen for advertising. But there were two things Piyush noticed. Print as a medium was left out of the guidelines and a sentence hidden in the mumbo jumbo saying ‘Quality that lasts and lasts’. He created what he says is one of his favourite print ads. A regular soap called Le Soggy that had melted in the water and the Le Sancy soap next to it with ‘Le Sancy’ written below. The tagline was of course ‘Quality that lasts and lasts’. He says instead of the manual, all he needed was that single line. Keep the brief memorable, insightful and, most importantly, BRIEF.
The Greek historian Herodotus said that when the Persians had to make a decision, they first made it when they were drunk and then made it again when they were sober. The decision had to be the same both times for it to be taken. Once you get an intuitive ‘go/no go’ for an ad film, then put on your thinking cap again. Ask a few basic questions. Are the feelings the script evoked the ones you intended? Is the role of the brand integral to the film? Can you articulate the advertising idea easily? If the script passes the goosebump test and the answers to these three questions are yes, like the Persians, you are good to go.
For an executive working with a creative, there is one cardinal rule. Do not play the role of a creative and try to fix scripts yourself. Accept or reject. Tell them what you felt when you saw the ad. But do not suggest fixes. Give the advertising agency the problem and not the solution. It is important not to demotivate the agency with harsh feedback. It is a labour of love and you have to be always open to the fact that you may not have got it right. Equally, don’t get coerced into not expressing what you feel. Sometimes the agency will bring several people including very senior people into the room in an attempt to intimidate you. But if you don’t feel anything at the end of the script reading, you should say it. This isn’t just my advice for any business working with advertisement agencies – keep this as your cardinal rule as a professional working with any kind of creative. At HUL, judgement doesn’t stop simply at approving a script. As I said before, HUL accounts for roughly 15 per cent of the country’s ad spends on TV. Getting an ad wrong is extremely costly. After the script is approved it goes through – you guessed it – rigorous consumer work. First the script is read to a few consumers to see if they like it and understand it. The script then gets made into an animatic or a cartoon and is then quantitatively tested with consumers on a few key questions – is it enjoyable, is it branded and is it persuasive? The questions are on a 5-point scale and the scores are indexed with a database. It is considered a green light if it hits the top two-thirds of the database. In salience- or fame-type ads, I tend to push for the ad to be in the top 10 per cent of the database on branding and enjoyment. In market development-type films, I push for it to be in top 10 per cent on persuasion.

Production is the final stop in the advertising process. If the creative agency is the architect of the house, the director of the film is the mason. She actually builds it. The agency should have a free hand in choosing the director once you have finalized the costs. But have a look at the showreel of the director before approving the choice. In my experience, there are three kinds of directors – those who get emotions, those who get humour and those who shoot beautifully. Choose the director on the basis of what you want the ad to be like. The director will often look at the film slightly differently and you must be flexible in incorporating her idea while still being true to the script that was tested. A meeting called the PPM or pre-production meeting is the forum where HUL, the agency and the director meet to discuss how the script will be treated while being shot. Typically, the director will give her version of the film, show you the cast, the costumes, the locations and the music. PPMs can either pass quickly, with the client having no view on anything, or degenerate into silly conversations on whether the dress should be dark blue or light blue. The best PPMs are those where you have detailed conversations with the director on how she sees the characters in the film. What sort of people are they likely to be, what were they doing the same day before the events of the film unfolded? Also get an understanding of what in the film excites the director. Is it the same thing that excites the consumers? Once you are aligned on the soul of the film and the character of the actors, the director will do a much better job than you in selecting costumes, actors, music and sets. Let her. In general, if the PPM is good, it is usually a bad idea for the client to go for the shoot, and HUL discourages it. That is back-seat driving and often ends in an accident. When the final film is shown to you, react the way you should have when the script was read to you. Does it evoke any sensation in you? Treat it like you would after a meal has been served in an expensive restaurant. Add a bit of salt or pepper if you must, but don’t ask the chef to change the dish according to your taste. If the food doesn’t work for you, bear it with a philosophical grin. Likewise, while you can make minor changes to a film after it has been produced, there’s little you can do if it has fundamentally not worked out. The right course of action if the film doesn’t work is not to air it on TV. No point putting good money behind bad.
(This is an extract from the book The CEO Factory: Management Lessons from HUL by Sudhir Sitapati, published by Juggernaut Books; 2019)

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Tags : marketing advertising Sudhir Sitapati Foods and Refreshment Hindustan Unilever Limited CEO