The 4 levels of marketing sophistication
Transform your marketing from a cost center to a catalyst for shareholder value.
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Dear Friend, Subscriber, and Category Pirate,
Carl Gerlach is a classically trained consumer packaged goods (CPG) marketer, turned CEO extraordinaire who has scaled brands and led massive turnarounds worth hundreds of millions of dollars.
He built his chops at mega brands like Kraft, Sara Lee, and Unilever. He was the Director of Marketing at Ball Park Hot Dogs when he took the brand from #2 to the #1 Category King. Here, he nearly doubled revenue in a few years and helped it become the only brand to grow revenue, market share, gross margins, and operating margins at Sara Lee. As the CEO of Maple Hill Creamery, Carl built the most expensive brand of milk sold at Whole Foods and simplified a massively complex portfolio of products while tripling the business.
(Carl is our kind of Pirate 😎)
When Carl led strategy and integrated business planning at Kraft’s Cheese & Dairy unit, he brought in Pirate Eddie to help him build a category growth strategy for the entire division.
The category marketing challenge:
The $4 billion dollar business unit wasn’t just one brand, but multiple brands in a diverse set of categories within the $40 billion dollar Cheese & Dairy mega categories.
Kraft singles: Individually wrapped processed cheese for sandwiches.
Kraft naturals: Rectangular blocks of natural cheese for snacking.
Philadelphia: Spreadable cream cheese for bagels and baking.
Velveeta: Rectangular blocks of processed cheese for dips.
Fresh Take: Shreds & “shake & bake” mix for chicken.
Each brand was sold in very different places in the grocery store.
Each brand had very different cost structures, profitability, and market shares.
Most importantly, each brand was at wildly different levels of marketing sophistication.
Carl asked Eddie for a unifying category strategy approach that would provide a common languaginge for each brand, but with highly tailored strategies that would work for each specific situation.
Pirate Eddie knew status quo marketing wouldn’t solve the problem.
Category design with a focus on, and specifically cheese Superconsumers, had to come to Kraft’s rescue.
In time, category science, category design, and a helpful commodities tailwind propelled Kraft’s Cheese & Dairy unit to record profits.
But the most interesting thing about this story?
Kraft’s cheese Superconsumers gave Pirate Eddie and his team a key insight into category marketing for growth and portfolio strategy.
Be sure your marketing superpower matches the company’s marketing sophistication.
Or said differently. It doesn’t matter how legendary the category design is, if the company can’t execute it.
There are four different levels of marketing sophistication:
Level 1: Marketing As A Cost Center
Level 2: Marketing For Category Brand Building And Pricing Power
Level 3: Marketing For Product And Business Model Innovation
Level 4: Marketing That Drives Market Capitalization
In this mini-mini-book, we’ll break down each level using the Kraft category case study to explain how to avoid a disconnect by marketing your company, product, or service at one level when you really should be at another level.
It’s going to be short, sweet, and oh-so pirate-y—let’s dive in.