Reckitt Benckiser UK general manager is boosting investment, despite the recession. Interview by Loulla-Mae Eleftheriou-Smith and Rachel Barnes.
Alan Thompson is unusual, within Reckitt Benckiser (RB), at least: he is a Brit leading the British division of the £8.5bn business, which is home to brands ranging from Durex to Cillit Bang.
Talismanic former chief executive Bart Becht - who left the business last year and was replaced by Rakesh Kapoor - referred to RB as a 'company without a country'. This, he said, was demonstrated by its operations in 60 nations, the fact that its top 400 managers represent 53 different nationalities, and the pride it takes in having non-native bosses at the helm of its country divisions.
The latter was the case in the UK until last July, when the then-UK boss, Italian Camillo Pane, was promoted to a global role, making way for Thompson, then heading RB's operation in Canada, to take up the reins at home.
Now six months into his role as UK general manager, Thompson, 44, oversees the marketing of all RB products here; marketing director Stefan Gaa reports directly to him.
Few big FMCG companies are more highly praised for their internal culture than RB. Staff and management, both past and present, are quick to talk of the sense of empowerment and entrepreneurial flair that is encouraged in individuals.
'We're not a business that is happy to sit contemplating its navel'
Maturity, intensity and competitiveness were the words once used by Becht to sum up RB. 'It's a fair summation of the company character, and of most people within it,' says Thompson, speaking to Marketing at RB's head office in Slough.
'I hate missing my number, and we want people who have that same attitude.'
He adds: 'We're not a business that is happy to sit contemplating its navel. One of the key differentiators of us as a company is the flatness of the structure, and also that we want all news, good or bad, to travel fast.'
That speed of business was evident in the management changeover. While the share price fell on news of Becht's departure, the lesser-known Kapoor is a company stalwart of 24 years' standing, and a respected figure within RB's ranks, according to Thompson.
'It's not a change in attitude or in culture; it's been very smooth,' he says. 'We get stuff on the table and discuss it very quickly. I deal with Rakesh several times throughout the year, in a formal sense, but many other times on an informal basis. This is what we encourage at all levels: be out there, getting the news and having the conversations.'
'Business as usual' is the message coming from RB. While some companies use this cliche to paper over cracks, the figures show RB to be in fine health. Group net revenue for 2010 rose 9% to £8.5bn, while it is on track for a 12% increase for 2011.
RB's focus is firmly on its 19 'power brands', which now include Scholl and Durex, following its acquisition of SSL in 2010; these remain the central pillar of the business growth plan.
'It's the first condom to improve the pleasure of both partners. We're taking them out from the shelf so you can see and feel them.'
No brand is left out when it comes to this push for growth, claims Thompson. 'Whether you're talking about Optrex or Finish, we want innovation everywhere.' He opens a cabinet full of products and pulls out the recently launched Durex Performax Intense line. This, he says, is a case in point.
'It's the first condom to improve the pleasure of both partners,' he explains, touching on a subject not often encountered in Marketing interviews. RB aims to 'demystify the category'. 'We're taking them out from the shelf so that you can see and feel them,' he adds, before quickly bringing the conversation back to a decidedly corporate tone by referring to condoms as 'devices'. From the same cupboard, he later brings out a bag of Finish tablets to show off its new packaging.
Innovation, whether it relates to products or pack design, is encouraged at all levels in the business, with speed to market once again playing a key role.
Thompson describes his colleagues as 'obsessive' about brands and says trying to find new concepts is like a 'feeding frenzy'. That excitement is spread around the company when it hits upon a success, to encourage others to try something new.
The timed-release air-freshener spray Air Wick Freshmatic was an idea that came out of RB's Korea operation in 2004. When it was brought to the table, vigorous debate ensued. While the majority questioned the cost of a new manufacturing facility and whether consumers would pay the premium, two managers fought for the chance to test it - and won. According to Thompson, it was rolled out across the world in only two years, and is RB's most successful launch.
This is part of the legacy of Becht, who said in 2010 that if someone at RB stood up and said 'No, I passionately believe in this. You are all wrong', he was willing to take a chance by testing ideas on a small scale. The thinking behind this being that, if it failed, it would do so with quickly and with minimal impact.
A similar situation arose in Canada when Thompson explored the extension of Resolve (Vanish in the UK) to in-wash and carpet products.
'Nobody wanted us to risk going into segments that were relatively undeveloped in Canada and might distract us from the bigger-base business,' he explains. 'However, we felt strongly that there was growth to be had, that we had a model and should play a role in building these segments, rather than wait for them to be built by someone else. We now have an established business in both, and an extra leg of growth to drive in future years.'
Thompson adds: 'Innovation truly is our lifeblood. When I was in Russia eight years ago we were launching several brands a year, and I've been involved in everything from flavour extensions to the Cillit Bang launch.'
Last year's roll-out of Dettol No Touch hand soap was another key development, he says. 'Launches are most memorable when we add value to the consumer and category by reinventing it in some way. Game-changers are the things that stick in your memory.'
Thompson was put to the test early in his UK tenure. A crisis surrounding Nurofen Plus erupted in August, when RB was forced to embark on a product recall and issue a consumer warning. This followed the discovery that a small number of packs of the painkiller on store shelves had been tampered with and contained other companies' anti-psychotic and anti-epileptic drugs. Thompson is proud of RB's response, working swiftly to get the brand safely back into stores.
'By withdrawing it, we gave up the market share on the brand while it was out, but didn't lose a basis point on the franchise, indicating that the consumer recognised we were taking the right action promptly and professionally.'
With so many health-related products, winter is a critical time for RB to ensure its communication is on-target. A raft of TV ads has aired in recent months, including a £10m campaign bringing together Strepsils, Lemsip and Meltus in RB's first cross-promotion ads, by Euro RSCG, under the line 'Don't lose a day'.
This month it is stepping up the activity, which broke in October, with further multi-brand ads, under a new umbrella campaign, 'Britain's greatest!', to run throughout 2012.
'It would be easy to hack back media spend in this economic environment, but there would be a price to pay in the future.'
While Nielsen figures suggest that RB has cut its adspend - the UK total in 2011 was down from £83.5m in 2009 to £77.7m - this does not make clear its strengthening focus on digital channels. Thompson claims that, overall, it is spending more than last year. 'It would be easy to hack back the media spend in a tough economic environment, but there would be a price to pay for that in the future.'
Thompson argues that there will always be a role for traditional media, but for RB's products 'to be brands that matter to people', this means maintaining conversations with consumers via new routes such as Facebook, as well as channels such as TV and print.
For Lemsip, it launched a 'Man flu' digital drive last year, communicating with consumers via Facebook. People were able to upload photos of friends to be used in a video set to James Brown's It's a Man's Man's Man's World, the lyrics altered to 'This is a man's flu'.
'Every day we look at the campaigns we're running and media we're using,' he says. 'We take a very vigorous look at ROI and ask, did it work? In future, if I took that £100, what would I get for it if I put it somewhere else?'
Getting the numbers right is, of course, critical. On that theme, Thompson is reluctant to be drawn on the subject of rival Unilever's 'More magic, less logic' marketing strategy, but adds: 'If you have the magic right, you will get the numbers right. I have never believed that these things are mutually exclusive, and don't understand why people would believe they are.'
While RB's outlook is positive, there is no room for complacency, given the ongoing economic insecurity and recessionary shopping habits of consumers. 'What works this year will not necessarily work next year,' is the thought he keeps in mind at all times.
Is working in Slough enough to sate Thompson's life-long world travel habit? 'There are challenges when you also have to move a family, but we've had the chance to live in some great places,' he says. 'I'm not planning on going anywhere for a while, although who knows what will come up? Change is good.'
It is unlikely that a career change lies ahead, however. As Thompson explains, working in this discipline was meant to be.
'When I left P&G, I wanted to study Russian and do a masters degree,' he says of a time when he 'did a lot of soul-searching' about his vocation. 'I met career coaches and did tests. When I'd finished, they told me the thing I was best cut out for was a career in sales and marketing.'
- District manager, rising to brand design manager, P&G (1990-2001)
- Management consultant (2001-03)
- Sales director, Russia; global category director; general manager, Canada; general manager, UK, RB (2003-present)
Lives: In Richmond with his wife and daughter.
Grew up: In Hong Kong, but moved with his family to Edinburgh when he was 13.
Favourite place to visit: Russia. Thompson is fluent in the language and his wife is from the country, so they go back about once a year - but only in the summer.
Favourite non-RB brand: Apple. 'The world is full of nice designs, but Apple has taken "nice designs" and made it commercially interesting.'
Favourite RB brand: 'I can't say, or I would be in trouble with all the guys here.'
TV campaign: Last October, RB launched 'Don't lose a day', a campaign featuring its over-the-counter brands Lemsip, Strepsils and Meltus in its first cross-brand promotion.
For 2012, RB is launching 'Britain's greatest!', a themed, multi-brand drive it believes will reach 850m consumers.
THREE CHALLENGES FACING THOMPSON
- Integrating SSL's brands and its marketing culture into RB
- Scrutinising the ROI on marketing, while building focus on digital
- Proving RB UK is strong following the departure of ex-chief Bart Becht
£8.5bn, UP 9%
Full year 2010 net revenue
£4.6bn, UP 14%
First half 2011 net revenue
£1.1bn, UP 14%
First half 2011 adjusted operating profit
Source: Reckitt Benckiser
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