Blog | Hugh Kennedy 08.23.18

Is Your Supply Chain Undermining Your Marketing Strategy?

It might be time to take a peek behind the brand curtain.

If you read the popular press, you’re familiar with recent product shortages in fast food. Who can forget The Great McDonalds Szechuan Sauce Insurrection of 2017 or the missing chicken that forced KFC to close nearly all of its 900 restaurants across the UK and Ireland?

Closer to home, I found it curious when I walked into my local Aesop, the Australian skincare chain, and was told by a calmly exasperated employee that no, their Avail body lotion with SPF50 sunscreen was still not available, and she had no idea when it might return. This is what the same employee had told me nearly two months before, and in both cases, she offered a vague explanation about an ingredient or production issue. 

Something felt off to me, so when I got back to my office I jumped onto the Aesop website and ordered two bottles of Avail lotion in under a minute. What shortage? I wondered. For the first time in ten years as a customer, this brand felt amateurish.

Consider, as well, Whole Foods. After the Amazon acquisition, they implemented a (am I dating myself?) delivery service, cut store staff, and eliminated dozens of small, local brands in favor of regional or national products they could standardize around. A friend in marketing didn’t pull any punches when I asked her about how she liked the changes: “The produce is bad, there are holes in their shelves, all the products I loved are gone, and the whole front of the store has become an Amazon fulfillment center!” she said. “I hate it there now!”

In each case I’ve mentioned, the wobbly state of these brands’ supply chains has disrupted and devalued their customer experiences – which is the last thing any CMO wants in 2018. Experience, after all, has become a primary driver of brand equity and loyalty. The question is, are you as a CMO ready to pull back the curtain and confirm  whether your marketing strategy is fully supported by back-office reality? As Bernbach said, nothing kills a bad product faster than a great ad.

The marketing image of almost every brand today is about plenty – sating any hunger in the case of McDonalds and KFC, laying out dozens of options for self-care in the case of Aesop, and creating what Venkatesh Rao in “The American cloud” called “one of the most carefully designed consumer experiences on the planet” in the case of Whole Foods. Yet even the most powerful marketing strategy falls apart when the spell of the “faux-farmers market” is broken by empty bins and rotting produce, even if it is organically grown on the roof.

This diminution of the brand experience applies internally as well. I can only guess at the morale of the Aesop employee who tries to make an SPF shortage sound mysterious and exclusive in the scorching sun of August. In the case of Whole Foods, their order-to-shelf inventory system has quickly pushed employee morale straight down while pushing out long-time staffers. As one told Business Insider, “I wake up in the middle of the night from nightmares about maps and inventory. The stress has created such a tense working environment. Seeing someone cry at work is becoming normal.” These people are the face of the brand, and they are crying. This is far more than a supply chain issue. It’s a marketing problem.

The result for customers is the same. Intentional, forced scarcity may create desire (Supreme jackets, Hermès Birkin bags), but unnecessary scarcity can quickly send buyers to other brands. How many brands of SPF body lotion must there be in 2018? Fifty, 80? The price of entry is very low. And yes, you can apologize with a cute FCK ad, but what do you do the second or third time when what you market just isn’t available?

Here’s the point: if you’re going to go to the trouble to tell a compelling story about your brand, your supply chain should be fully along for the ride, not to mention invisible. Customers shouldn’t have to ask about it or have to understand it.

By the same token, if the enterprise behind you has engineered out inefficiency to the point where shortages and long delays start to mar the customer experience, or all parts of the enterprise aren’t aligned around the same data, the good marketing you’re doing may be all for naught. In the 1980s, when I was dealing art, I remember a client philosophically telling me that “you order a custom couch from Italy and wait six months and it arrives and the color is wrong.” But that’s not today’s customer.

Not by a mile.