On the Shoulders of Giants
The value of creativity at Burger King
"The biggest challenge for us is keeping the quality of the work that high, because that’s exactly what the guests and our fans expect from us."
Fernando Machado, Burger King
"My ears are actually normal size, to be honest," says Axel Schwan, Burger King's Chief Marketing Officer. He'd just told me that at Burger King they 'have very big ears'. I think my delight at the expression made him worry that I hadn't realised it was a metaphor. "It's part of our culture," he says. "We listen a lot to what our franchisees say about the work. They see our guests every day in their restaurants, they know our guests extremely well."
"And clearly the advertising is resonating with our guests," chimes in Joshua Kobza, Burger King's Chief Financial Officer. "I hear that from them all the time, both from our guests and our franchisees."
Three years ago Kobza helped orchestrate Burger King's purchase of the Canadian coffee and donut chain Tim Hortons. The combined company listed as Restaurant Brands International and their stock fortunes have since soared. "If you look at the last three years, the stock's gone from $26 a share in March of 2014 to $56 a share in March of 2017," Kobza explains. "So we’re up about 110%." During the same period, the S&P500 grew 26%.
It's the same story played out again and again. Companies that win Cannes' Creative Marketer of the Year award have a reliable habit of outperforming the stock market, and Burger King is 2017's addition to that canon. The average Creative Marketer of the Year company beats the S&P500 by three and a half times. Burger King is more like four and a quarter. But who's counting?
"You know, we stand on the shoulders of giants," says Fernando Machado. As Head of Brand Marketing, Machado is the guy driving the creative output at Burger King. And the company's legacy of great work isn't lost on him. "The biggest challenge for us is keeping the quality of the work that high, because that’s exactly what the guests and our fans expect from us."
“Being recognised for the work is a big deal for us”
Alex Schwan, Burger King
That expectation has been built up over many years of brilliant Burger King advertising.
"More than 10 years ago we had campaigns like Subservient Chicken, which to this day is still considered one of the biggest viral hits of all time... Whopper Freakout, which was a classic that created waves of popular culture and talkability, and as a campaign has one of the highest recalls in history in the US."
Living up to the legacy, however, hasn't proven too much of an issue for Machado, Schwan and their global team of marketers and agencies. Campaigns like Proud Whopper in the US and #whoistheking in France have won multiple Lions in recent years. And then of course there's McWhopper. Winning a total of 17 Lions, the campaign earned Burger King two Grands Prix and the Gunn Report's commendation as the most awarded campaign in the world in 2016.
"Being recognised for the work is a big deal for us," says Schwan. "It makes people proud at Burger King. And something that people are proud of very much was the McWhopper campaign. We had close to nine billion impressions around the globe, it was the most talked about campaign of that year globally across all categories, and that created lots of pride within everybody that works here."
Perhaps the most surprising thing about McWhopper is that it didn't come from a brief to one of BK's global agencies of record, but rather found its way across the world from the imagination of an agency in New Zealand.
"We looked at it sitting in an office in Madrid, somewhere in the basement. We looked at it together the first time and thought 'wow, that seems like magic'."
Schwan sees BK's ability to bend the process to great work as a differentiator. "When you look at where the idea came from, it gives you an idea of what our culture is really about. The idea came from New Zealand, from Y&R, an agency partner that we don't work with globally. But if there is a country that has a strong agency partner like Y&R, and they have an idea that is bigger than the country, that has legs to be really effective globally, then the idea travels really quickly from New Zealand to Miami."
"It's not just advertising. It's the restaurant design, it's the packaging, it's the uniforms, everything that we do in the world"
"We see creativity as a key ingredient for our success," says Machado. But like all of the Cannes Creative Marketing of the Year companies that I've researched over the years, creativity at Burger King isn't just about the advertising. In fact, what's led to market leading same-store sales growth of 10% and total system growth of 25% across the last three years has been a dedication to creativity right across the business. "It's not just advertising. It's the restaurant design, it's the packaging, it's the uniforms, everything that we do in the world," says Kobza.
"Innovation is also an area that we show creativity as a mindset," says Machado. "We have products such as Chicken Fries which are a big hit everywhere and a very innovative, different product. Not just the product, but the design, the way the communication works with the design and all the marketing mix of that product coming together. Two years ago, we did the Halloween Whopper. Again, an example of something that's completely different - a black bun whopper infused with A1 sauce that was a big hit in the US."
But the application of creativity that I found most disruptive was in the way they've opened their minds to new global partnerships to drive growth at scale.
"It's a different type of creativity," says Kobza, "but I think one of the biggest things we've done in the last six or seven years is rethinking the way we set up partnerships to grow the brand all around the world. If you go back ten years or so, we were building few restaurants with smaller partners around the world. Because of that, we had a sub-scale business, we didn't have the scale to have an efficient supply chain, we didn't have the scale to have the brand awareness. We didn't have the scale to do national advertising on television. So we decided that if we were going to be really competitive and build a scaled brand and a really profitable business, we needed to find partners who shared the vision to build the brand out to the right size, get it to an efficient scale and bring the brand to its full potential in each of those markets.
"It's probably been one of the most transformative things that's caused us to improve our results over the last six-or-so years. We really rethought the way we were developing international markets, and that required a whole group of people to really open their minds and rethink our business model."
"Despite the fact that Burger King is actually a very large brand and business, we always look at ourselves kind of like a very big start up"
Fernando Machado, Burger King
"We've put together new partnerships in Russia, Brazil and China, and through those partnerships we’ve really increased the pace of development so that now, in Brazil, we have about 600 restaurants. In Russia we went from 10 restaurants to about 400 or so today, in China we went from 35 restaurants to over 650 today. We used to grow about 170 restaurants a year. This past year we grew 730. So that’s another area of the business where we've taken a different approach to how we did things."
And as those partnerships enable to brand to spend more on great work, that work in turn paves the way to better partnerships.
"As we're more effective in our advertising, and we're able to change how people view the brand, it also attracts more potential partners to have confidence in and want to invest behind the brand. So I think there is a double impact of how effective our advertising is - it's a very powerful thing across a few different drivers of our business."
As with so many innovative companies, Burger King thrives more on attitude than anything. They're one of the world’s largest fast food chains, but refuse to see themselves in a way that would permit the bureaucracy and creative malaise that pervades most large organisations.
"I would say that it's the mentality," says Machado when I ask him what makes Burger King such a great breeding ground for creativity. "Despite the fact that Burger King is actually a very large brand and business, we always look at ourselves kind of like a very big start up, you know what I mean? The structure is very non-hierarchical, the spirit is very open. We empower people, we are very meritocratic, we are bold. Those values are critical in terms of not falling into a big, fat, bureaucratic corporation where creativity will die or suffer because there are so many people involved and people are risk averse.
"We don't suffer from that because of the mentality of being like a big start up, being meritocratic and being fun and being bold - which we live day-to-day."
This article was written by James Hurman, author of the 'The Case for Creativity'.
Burger King is the Cannes Lions 2017 Creative Marketer of the Year.