Q&A: J&J's Kadlec

NEW YORK Consumer healthcare giant Johnson & Johnson last week wrapped up its $3 billion global media review, sharply revising its planning model in the process. The New Brunswick, N.J.-based company created a separate assignment for communications planning in North America, which it has divided among three entities: independent Naked, a new Interpublic Group entity called Sandbox and WPP Group's JWT.Kimberly Kadlec, J&J's CMO and worldwide vp, oversaw the review and the development of the new model after a year of experimenting with communications planning on some key brands with Naked. Here, Kadlec talks about how she came to embrace the practice and why communications planning will be critical to the company's media strategy going forward.Q: You've created a new media model that puts communications planning at the center. Why?A: I've spent 18 months working with the businesses [at J&J]. I went through the planning cycle with them last year and it was apparent that there is a gap in strategic thinking as it related to media planning. As we started to explore and experiment with communications planning, we decided that that was an appropriate answer for what had been missing. It's a response to the changing media landscape?Yes. In this environment, with the way consumers behave now with the new technology, this media-neutral, insight-driven approach made sense. Prior to the review you had been experimenting with the technique on several brands with Naked. At what point did you decide to create a separate AOR for it?As we developed the brief for the global pitch, what we decided to do in North America is break the pitch up into two pieces. One was for what we call a leverage AOR, which includes media planning, buying and activation, and the second pitch was around purely communications planning. That second pitch involved Naked, OMD and Universal McCann.That is correct, and I would phrase it as Naked, Omnicom and IPG, because what we asked them to do was take a step back as a holding company and bring forward a unit that could draw upon any of the assets across their holding company that were appropriate and could add to the communications planning unit. As opposed to being media-agency centric?Right. Have it be born from a holding-company base where you have event companies, entertainment companies, PR companies and really take a fresh look at how you are going to approach our brands. Naked is a relatively small agency that came away with a large piece of the North American communications planning assignment. What was that decision based on?It was based on their track record over the past year. [We also included] a wide variety of our marketers from across the company in the pitch [so they could] see it in action. It really convinced people that this is the right way to go. What brands had they worked on previously?Visticon [contact lenses] primarily and some project work on [feminine hygiene brands] CareFree and OB. How did you sell this internally?Very collaboratively and really selling the success we had on the projects [we had previously done with Naked]. [Marketers throughout J&J] saw it immediately. [J&J brand managers] had pretty good representation at the pitch meetings, and we walked out of the communications-planning meetings and had a debrief afterwards. It was unanimous in the room that this was a model that is going to significantly bring us to the next level as it relates to communications. How does the communications-planning piece in North America get divided among three roster shops?We're working through that right now with marketers on specific brand assignments. So it will be divvied up by brand?Yes, brand or franchise. Can we assume that communications-planning chores for brands that Naked has handled up to now will remain with that shop and that JWT will be assigned brands it has handled creatively?Not necessarily. For now, North America is your only region with a separate AOR for communications planning. Will you extend that model to other territories?That is the idea. We are going to look to expand it as we [compile] successful case studies. We will look to expand the model globally. Our marketers outside the U.S. are very interested in growing this out. How soon?In the near future. Will you conduct additional reviews for that?No, I wouldn't anticipate that. To what extent do you think the communications planning work will impact the media mix?I think it will greatly impact the media mix. It will vary by business. It will vary by geography. But I do think it will alter the way we look at how our budgets are divided up. Not necessarily just media budgets. I think it's a more holistic view from a brand perspective, but potentially could change it quite a bit depending on the brand and the strategy. Will the roles of digital media and content creation continue to grow?It will depend on the franchise. It will vary—it's so diverse. Some brands will have growth in that area and others will be different. To what extent was the review about cost savings and procurement?It was about efficiencies and leverage, and it was about innovation and raising the bar in the way that we connect with consumers. Both sides of the media equation are very important. You made a decision to forego the TV upfront marketplace this year as you did, for the first time, last year.Yes. We're very happy with the strategy. So that will continue to be the strategy going forward?I expect it will be the way we go as long as it is the right thing to do for the brands. Have all of the awardees in the review signed off on contracts?We sent out the press release and the decisions have been made.

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Q&A: J&J's Kadlec

Steve Mcclellan

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