Not a short term thinker

He might not boast the biggest marketing budget in town, but Malcolm Sullivan, VP marketing for Asia Pacific at Federal Express, knows how to get the best from his agency partners and make sure marketing gets a seat at the decision making table. Matt Eaton reports.

Overseeing a regional team of more than 200 marketing staff, Sullivan claims an underdog status against his main competitors DHL and UPS, but argues the company's efficiencies in media planning and buying give FedEx a strong competitive advantage.

Sullivan places a heavy emphasis on targeted media buying, managed by the Omnicom Groups' OMD.

"We're significantly outspent by our competitors," he says. "But at the same time, because of our discipline and because of our execution, we deliver better results. Our investment is delivering higher returns than the significantly higher investments of our competitors.

"But what we have to do is make sure every dollar we spend is working very hard for us and hitting our target."

FedEx's marketing strategy around the region sees the transportation company attach a multi-layered approach to its brand which includes a big mass-marketing strategy, loyalty and corporate social responsibility programmes as well as targeted sponsorship of local sporting identities.

Sullivan says this strategy fits well for a company that targets a largely B2B market.

"Our business has always been with manufacturers and moving critical parts. We're really more about B2B service and particularly high grade products like iPods. One of our big and valued customer is Apple."

And what exactly does all this mean marketing the FedEx brand?

"It means a couple of things," Sullivan says. "Firstly, our target audience are pretty clearly defined. Our main focus and target are the business users.

"In terms of advertising, TV and print are still our main media and that is because of the power of those.  I think media and media selection is as critical to building a brand as is the creative side, even though the creative side gets all the notice. But you do need to have good strong creative with a single minded-message and if you can have that, then that will help you maximise the investments you make on the media side."

FedEx mass media strategy may surprise some, based solely on the fact that it is very much centred around mass media such as of television and newspapers.

Sullivan aggress while the power of mass media is in decline, it's still the best way to convey a single minded strategy.

"For an FMCG and for mass market brands, absolutely, the media is fragmenting. But because of the very heavily targeted media strategy that we have, we segment our audience and we're used to that fragmentation.

"We're very familiar with that kind of fragmentation because we have to make that small investment go very far."

Despite getting good results from mass media, he admits today, digital is providing the best bang for his marketing buck.

"One of the things you have to remember when communicating in a business-to-business environment, is that digital is not top of mind for business people, so if they see an email or some kind of digital communication, it's got to be very powerful before they'll be interested. In a decision making environment it has to be much more rational than emotive."

"You really need to have a robust brand presence, either as a door opener for the sales guys or as part of your relationship management with smaller customers.

"Again that's why we go back to the power of mass media, you can't deny it, mass media is still powerful, particularly in advertising and brand building.

"You don't get the same impact from a digital medium as you do with the drama of a 30 second spot. It's just that simple."

Jean-Paul Burge, BBDO regional business director on the FedEx account and MD for BBDO Singapore, says over the past three years he has known and worked with Sullivan, the FedEx marketing boss has shown a rare consistency in managing the client-agency relationship.

"He trusts our ideas but still makes the decisions that need to be made. He is very conscious of budgets and the importance of financial prudence but is also a champion of the big idea giving value that can go well beyond the initial cost," Burge says.

"And he gives us time to develop great ideas, implement and improve them."

Burge adds the great success that the creative work the agency produced for the Asia region over the last few years is a testament to a "great relationship" between BBDO and FedEx, much of which is down to Sullivan.

Like many marketers, the issues keeping Sullivan up at night are not too far removed from the wider marketing industry, namely making his marketing investment work harder and attempting to get agencies to realise the changing market needs.

"From a client perspective, it's the old chestnut how hard is my marketing dollar working for me. Gone are the days when marketing was some slush fund.

"We're a very fiscally conservative organisation and we have commitments to Wall Street, so I just can't walk in and say ‘Hey I need X amount of millions to run an ad campaign. This organisation is nuts about measuring things."

But Sullivan adds that one consistent strategy he employs, is getting the best from his rostered agencies.

Despite his good working relationship with the Omnicom group of companies, Sullivan believes agencies have largely failed to recognise the changing marketing landscape and understand what it means to be a partner in the marketing field.

"I think agencies are these days more volatile than clients. If you're a business person, change is the name of the game and competition is the name of the game.

"We have great competitors which keep us on our toes. But I feel as if agencies have been a little bit slower in responding to some of the changes in the environment," he adds.

"Some of the agency people are still talking like change is optional. It's not. You have to change to be successful. That doesn't mean throwing the baby out with the bathwater, but maybe some agencies out there need to accept the reality of change."