Reputation Institute issued an interesting study this morning. After looking at what matters to Millennials in 15 leading economies of the world – “the markets that matter” – the research consultancy finds there are seven factors that build a brand’s reputation: products and services are most important, followed by corporate responsibility, corporate governance and citizenship, ethics, what you do for society at large, management and at the end of the list, financial performance.
That’s not to say Millennials don’t think money is important. They do. But non-Millennials think making money is more important than financial performance.
Many companies are doing well on governance and citizenship. But they’re not communicating that, and so they don’t get credit.
Listening to the discussion this morning, we had to wonder if this, perhaps, is partially an explanation for what’s happening with Big Beer. The human connection is just so critical, it seems.
Anheuser-Busch InBev and Molson Coors have been focused on financial performance, and arguably have been doing reasonably well, although ABI’s bet on emerging markets came back to bit it last quarter. But their volumes and their shares just continue to ebb lower and lower.
Meanwhile, spirits brands and craft beers are doing well, as is, to a lesser degree, wine. Both ABI and Molson Coors have shoved the founding families to the side. ABI even cut way back on the Budweiser Clydesdales.
But look what’s happened over in spirits: Master Distillers are celebrated (see, for instance, even if they are not at the financial helm. A couple of guys buy a derelict distillery, rehab it, steal a woman from Brown-Forman, and relaunch it as Castle & Key. Same thing with Michter’s, which has its Master Distiller and Master Blender as its public face.
Brown-Forman puts its master distiller out front, and has a Brown family member as its chairman, even as a non-family member fills the CEO’s chair. And as much as they can, wine brands advertise the people behind the brand.
Beer’s a bit different, but only because the two big brewers are just corporate entities. They do many of the right things: They work hard to improve the environment, they have good products, competent management. But they don’t have a person as their public face.
That’s different than the craft brewers. The founders are usually still associated with the company and talk incessantly about corporate values.
One has to wonder what would have happened if, when InBev acquired Anheuser-Busch it had kept a Busch family member or two, perhaps as head of brewing (following Beam Suntory’s relationship with the Noe and Samuels families), or as chairman (following Brown-Forman), and used them as the public face of the company.
Leaders in other industries have done this: A Ford is still at the top as chairman of Ford Motor Co., a Marriott still runs the hotel empire, and The Wall Street Journal’s email newsletters – its direct, more or less personal, connection with shareholders feature the name of the editor or the Washington Bureau executive editor in their “from” lines.
We think this is somewhat different than signing up a celebrity for a three-year gig producing a couple of videos a year. Consumers – especially Millennials – want a human connection with a long-term commitment to the brand.