SBD/Issue 165/Sports Industrialists

THE DAILY Goes One-On-One With FedEx’ Laurie Tucker

FedEx Senior VP/Global
Product Marketing Laurie Tucker
Federal Express was founded 34 years ago.  LAURIE TUCKER, Senior VP/Global Product Marketing, has been there for 26 of those years. Tucker has only had marketing in her title since ’00, but she credits a marketing-intensive culture instilled by FedEx Founder & Chair FRED SMITH for much of the company’s success.  Since FedEx was founded on a vanilla service (delivery) that it made “new and improved,” marketing has never been an afterthought.  Tucker: “It’s not something that’s viewed as an extracurricular activity here.  We’re as focused on product development as any company, but Fred is always the first guy that asks what the value proposition is and how are we bringing this to market in a new way.”  FedEx spent $21M on sports advertising in ‘04, according to Nielsen Media Research, and with the recent addition of JOE GIBBS’ NASCAR team sponsorship, along with an NBA league deal, it has a portfolio as impressive as any. Tucker recently discussed FedEx’ packaging of marketing and sports with Editor-at-Large Terry Lefton.
 
Q: You haven’t quite reached the levels of a Coke or Anheuser-Busch yet, but FedEx is approaching them in terms of ubiquity across sports.  What’s the strategy there?

Tucker: Around ten years ago, we began to realize that very clearly our target was 25-50, male, professionals and at the time predominantly male decision-maker.  We learned through things like the St. Jude’s Classic and the Orange Bowl, and learned that not only was it a great boon to our branding and our advertising, but it was a tremendous hospitality vehicle.  We really hadn’t had anything like that.  So we saw the opportunity for great reach.  The real value is being demonstrated today.  

One of the challenges all marketers face is diminishing returns on television advertising.  Obviously sports is more TiVo-proof than other programming, so it is very helpful there. We’re still finding that our reach is greatest through the use of sports marketing.  Sports has also helped us build customer loyalty.  We’ve built incentive programs around sports for our best customers where they can win things like NFL (licensed) items or a trip to the Super Bowl or some other important event we sponsor.  Loyalty programs are in great vogue right now.  As companies and products mature, we are all looking for a key differentiator.  The loyalty premiums we get through associations with our sports properties have had a very positive impact on sales. I think most people know the brand, but we are aligning ourselves with sports properties that are also viewed as leaders, and that rubs off.

Q: What are the biggest motivators in your category?

Tucker: What really drives purchases is relationships, affinity and affiliation with the brand.  That tells you a lot, again, about why we are so involved in sports.

Q: For a real life example, tell us how your new NASCAR team sponsorship fits in.

FedEx Feels That NASCAR Shares
Qualities Like Speed And Precision

Tucker: There’s a huge opportunity for us, if we can match our brand equities of reliability, speed, precision, and teamwork with NASCAR, which clearly shares those qualities.  It may be subtle, but it is brand building by aligning ourselves with other leaders that we have things in common with.

Q: Why more sports properties like NBA and NASCAR in the past year?

Tucker: Well, a marketing analysis could easily have shown us that a NASCAR sponsorship was not the best way to spend the next chunk of our marketing budget.  We already had very solid coverage during the NASCAR season, with things like the NFL.  The primary benefit for us with NASCAR is as an employee.  It was a question all of our marketing folks got everywhere we went -- ‘Why are we not in NASCAR?’  Now that I’ve been exposed to it a little, I know it is the most passionate fan base I have ever come in contact with.  Our employees wanted NASCAR more than they wanted their next breath.  When it was announced that Joe Gibbs was going back to coach the Washington Redskins, I turned to whomever was next to me and said, ‘I give us three months before we’re into NASCAR.’  It took a little longer than that, but not much, and we had our decks prepared for senior management to tell them how much it would cost before they called us.  We’re working hard to use it as an employee motivator.  The NBA gave us a platform where we can reach a young diverse audience, and we also got a way to emphasize our global reach and another important hosting opportunity for our customers.

Q: As someone who gets a lot of sponsorship proposals, what kind of filters do you use to separate the wheat from the chaff?

Tucker: We ask if it is a leadership property, does it provide us with a new value we are not getting delivered by our current properties.  Does it reach a unique segment of our customer base we aren’t reaching already.  Like with the NBA, the opportunity is to reach that international customer and customer overseas.  The NBA is active is China, and there is a real possibility we will leverage that relationship as we continue to grow and develop in China. ... I think it is also important for us to be constantly reviewing each property and be sure they are delivering on the investment we make.  The NFL is a great property and we are an NFL sponsor, but the moment our competitors can advertise and do a lot of marketing around the NFL, that confuses consumers as to who the NFL sponsor really is. ... So we work constantly to be sure we are getting value.

Q: The other thing sponsors struggle with when it comes to sports properties is definitive ROI.  What is your formula?

Tucker: The hardest thing to measure from an ROI standpoint is advertising.  We get a high return on brand recognition and recall for advertising shown within our sports properties. When we do customer hosting and hospitality, we measure our guests before and after that event.  We use that information to justify the investment, but also to help our sales staff find the best prospects.  Every guest has a sales contact, and we track them with our sales team so we can be sure the right customers are being hosted at our events.

Q: FedEx seems to use their sports properties far less in advertising than other big buyers.  Visa, for example. What’s the thinking there?

Tucker: I don’t know that it is planned that way.  If there’s a good creative idea, we’ll go for it.  Last year, we had some good NFL ads in concept, but then we bought Kinko’s, and that is where we spent our marketing budget, too.  We’ll look at the NFL again this year.  There is value in the affinity, and in NASCAR, for example, very few run ads that aren’t NASCAR-related.  So I think we are going to look more at that overall.

Q: DHL has been spending a lot behind its re-branding effort.  Have you seen any effect in terms of market share yet?

Tucker: They’ve done a nice job in terms of their brand launch, and we have seen they have picked up their brand awareness.  I give them credit for doing a nice job there, but it has not impacted our market share.

Super Bowl Commercial That Tied Into
“Cast Away” One Of Tucker’s Favorites

Q: There’s been years of great creative behind the FedEx brand (FedEx has been a client of BBDO, N.Y., since ’89).  Do you have a secret for keeping it fresh?  Do you have a favorite ad after 26 years?

Tucker: Provocative advertising has become such a part of our culture, our employees have become our most harsh critics -- they either love it or hate it.  So I take it as a personal challenge to please them.  Really it (good advertising) can motivate them, so it’s really helpful.  Our formula is usually one of telling a short, funny story, where our customer or FedEx is the hero or the problem solver or both. ... My favorite ever was the fast talker, but that was a while ago (an ad that first aired in ’82 from the now-defunct Ally Gargano agency and starred JOHN MOSCHITTA JR. as a business exec who could speak as many as 450 words per minute). More recently, I thought our “Cast Away” ad (Super Bowl ’03, a tribute to the film of the same name that had liberal FedEx product placement throughout) was a brilliant idea, well produced, really epic, with a huge laugh at the end.

Q: What brand do you admire outside of your own?

Tucker: AmEx, and we have more in common than most people would think.  We have very similar marketing issues in that we have strong brands that are often misunderstood -- people think AmEx is a high-end charge card only, and they have spent a lot of time and money trying to educate consumers that they have products for everyone.  We have similar issues, in that people often think of us as a premium product only for overnight delivery, and we do everything now from biz-box freight for stuff like ball bearings to small business that we can service out of our Kinko’s acquisition.  We share a lot in terms of our approach to the market.

Q: What sports event do you want to go to but haven’t gotten around to yet?

Tucker: I had to choose between the Daytona 500 and the NBA All-Star Game this year since they were on the same weekend, and I chose Daytona, because it’s our first year in NASCAR.  So I guess now it is the NBA All-Star Game.  Before this year, I never wanted to go to a NASCAR race, and now I can’t wait to go to the next one, so obviously that answer is subject to change.

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