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- [00:00]
Fernando Machado
Foreign.
- [00:07]
John Evans
Ladies and gentlemen, welcome back to the Uncensored cmo. We have a returning guest for you in this episode, none other than Fernando Machado. And we're going to be talking all about creativity. Now, Fernando knows a little bit about creativity. Having won lots and lots of Cannes lines, he's probably most famous for Moldy Whopper. And in this episode, we're going to talk about creativity, not just in advertising terms, but how creativity can be used across business and not just big brands, but also importantly, how creativity plays a mega role in small and emerging brands as well. Finally, how he's bringing all his experience being creative to bear in a new course called the Growth MBA with Lions. Fernando, as always, is fantastic value. So I'm excited to share this episode with you. Welcome back to Uncensored cmo. And I've got a returning guest here. So all the way from. Well, actually, where are you, Fernando? All the way from Miami. Yes. Fernando Machado.
- [00:58]
Fernando Machado
Well, last time was at my home, like where I was born, Rio de Janeiro, right during the web summit. Now we are in London.
- [01:05]
John Evans
That was a lot of fun as well. I remember that.
- [01:07]
Fernando Machado
It was quite an operation.
- [01:09]
John Evans
That's huge.
- [01:10]
Fernando Machado
It was the first time they were doing the web summit in Rio and they keep coming back for more and continues to grow. So it's nice to see and it's nice to have been part of the first one.
- [01:20]
John Evans
It was pretty cool. A great experience. Now you're working with Lions now, but we're going to come back to that because I want to talk to you a bit about what you're cooking up with the Lions team. But one of the things you're well known for is the role of creativity in marketing. And I remember last time you remembered exactly how many Cannes Lions you'd won over your career. But I'd love to find out a little bit more about the role of creativity for a marketer as well, and how important it is. But maybe if you reflect on your time, what are maybe the campaigns that you've done that you've been most proud of that have had the biggest impact on your business?
- [01:56]
Fernando Machado
I was lucky enough to grow up in marketing at Unilever. It was my first job up there and I was looking up at amazing creative work, not just in advertising, but like in design, innovation, like, even the way they do market research and all those things. So with people that were amazing, like whether it was Simon Clift was the CMO back in the day, or Silver legado who became CMO for Bacardi, then McDonald's worked for Natura. Like, it was like really an amazing school, you know, like, so I, I grew up learning that creativity can drive stronger result for the brand and for the business. So I was always striving to do, to tap into creativity, to do great creative work. And. And it's more than just advertising, right? I mean, sometimes you can be creative to cut costs, sometimes you can be creative about finding an innovation that will extend the brand to a different consumer target. Sometimes it's advertising, sometimes it's pricing. So. So there are different ways to be creative. And to me, like, creativity is like a way of life, you know, like it's beyond campaigns. Now if you ask me, like, which campaigns I think were the most memorable that I was lucky enough to be part of, it's hard to choose. Right? But like, I think that Real Beauty sketches for Dove was pretty transformational for the brand and for me and for the team and for my boss, Steve Myles, when we did back in 2013 for Unilever. And I can explain why it was, it was such a blockbuster in terms of being transformational for the brand. On my Burger King days, like, there were plenty to choose from, but I would say that Moji is probably like up there. And then the third one I think is probably the trickiest one to choose because like there was so many, like what it was Whopper Detour or like burning stores or some stuff that we did for Notco, which is a startup, which again proves the point that even if you're small, you can do great creative work. In fact, you should be aiming even higher because you are small. So I will probably pick Whopper Detour because I think the technology angle embedded on idea, I think it's something pretty, pretty cool.
- [04:19]
John Evans
Yeah. And just describe a bit about that campaign, how it came.
- [04:21]
Fernando Machado
Yeah. So like Sketches, which was the number one on my list when I joined Dove, it was I think like 2009 ish. And we were like really like struggling to create something as powerful as what the Dove team has done 10 years before. Right. I don't know if you remember, but like around, I think like 2004, 2005, Dev was on fire. Like, the positioning for Campaign for Real Beauty was brought to life for the first time. They did a very famous campaign for a firming lotion with the real women in white underwear. They did Pro Age, which was like an anti aging product. And they did Evolution, which was a brand film that was basically like kind of like a time lapse of like a real like normal woman, like being like putting makeup and being photoshopped to look like a model. And that was very famous in the industry and most importantly, famous with people, because it really, like, made people think about their relationship with beauty and made them think about how the beauty industry was, like, putting forward unattainable beauty. And there was a bit of a vacuum after that. So with Steve and I, I think that our ambition was to try to do something that was as close as possible, as good as we could, like, trying to go into that direction. We knew that the positioning about Ryobiuchi was still very relevant, but we had to find different insights. We did a ton of research, and in one of the quantitative research that we did, it was done in more than 20 countries. If I remember correctly, there was a piece of data that was very shocking for all of us, which was that only 4% of women consider themselves to be beautiful across the globe.
- [06:18]
John Evans
4%?
- [06:19]
Fernando Machado
Yes. It's pretty damn low, right? It varies a little bit depending on the company.
- [06:23]
John Evans
Is it the same for men? What would be the mayor?
- [06:24]
Fernando Machado
Oh, men. It would be 95%.
- [06:28]
John Evans
Confidence.
- [06:29]
Fernando Machado
In fact, like, there are some parodies on real beauty sketches which are exactly about that. But, like, so we decided to, like, focus on that insight or on that fact, right? And we had a brief that was very simple, which was make women feel more beautiful. And Ogilvy Brazil, Ogilvy, Sao Paulo, came up with the idea of real beauty sketches, which was a social experiment. We didn't know if it would work. I would argue that hard to test. Like, before you produce the thing. We took the chance we produced and it did work. And it was like a massive blockbuster. It was the first time I worked on something that if you took an Uber, there were no Ubers back then. But, like, if you took a taxi, there was a high chance that the taxi driver would talk to you about real beauty sketches. If you went to a pub, for sure someone will be talking about real beauty sketch. So the. The world was talking about it and. And I really think it made an impact. So that to me, because of the impact it created to this day, like, sometimes I present with a beauty sketch and there is always someone who may not have seen it and you can tell, like, and even if you watched it before, like, it still touches people. So it was amazing, like an amazing feeling to do something so meaningful that create an impact for the brand. You could see on the brand tracker, we end up, like, selling more Dove. Even though it was not the main objective of the campaign, it was like, amazing that feeling it was the first time I felt that feeling to that extent. You know what I mean? Like, and it's addictive to. Yeah, like after you create something like that Moji. What people don't realize is that Moji Whopper started probably like four or five years before Moji Whopper. Like, it started based on the fact that the level of. Like when you look at the brand tracker for the Burger King brand, most of the key attributes were much lower with the younger folks than with the older folks. So if you looked at things like feeling good about the food or, or even association to flame grilling or great tasting food, all the key attributes of the category, at the end of the day, it's food, right? The index for 20 to 30 years old was way lower than 40, 50 plus. So we knew we had to do something about it. People, when they go and eat a burger, they know it will probably have a little bit more fat, a little bit more salt, a little bit more calorie than eating a salad, right? But they want to eat something that, that is real, you know, that's the real deal. They don't want to eat artificial crap. And this sentiment was much stronger with the younger folks. So imagine that, right? We already had the position that was weak, weaker, let's say, than with the older folks. At some point, these guys, they will be demarket, right? I mean, because they will get older, the oldest guys will graduate from the category. So we had to do something about it. Honestly, I never thought that 10 years from now people would still eat stuff with artificial ingredients on it, right? So if you had that vision and if you have the conviction that that's where it's going, you have to do something about it. So we embark on this journey to change the product, you know, and it was a nightmare to do it because there is a reason why companies use artificial ingredients, right? It's cheaper, the shelf life is longer. People actually like the taste of that stuff. You know, if you put more salt, if you put more sugar, people like more just like evaluating taste. So it was a nightmare to find alternatives, to make sure that we are not compromising on taste, to make sure that we found clever ways to bridge the cost gap. Because there was a gap to train the people in the restaurants, like mayo. Mayo was not refrigerated because it had agta, which is a preservative. Now it doesn't. So how we need to refrigerate, so it changes the procedures in the restaurant. So I'm actually more proud of that than Moji Whopper. But Moji Whopper is what becomes famous. But people don't realize the work behind the scenes and why we did. And by the way, there is one thing on Moji Whopper that I think that people don't realize either, which is before we did Moji Whopper, we did another campaign which was much more didactic. It was not even that bad, but it was more didactic in terms of explaining what we did and people trying the product and liking the product and all that. We aired that thing pre super bowl which is cheaper than airing on the super bowl, but still more expensive than airing in a normal day in the US no one knows this because it didn't come through at all. It was just a self serving ad of us talking about ourselves in a way that people just don't engage. It's very important to improve the quality of the food. If you are a restaurant, it's amazing what the team was able to do in terms of removing ingredients from artificial sources. But in the grand scheme of things, you have big efficiencies to fry on your life to make that message cut through, because you need to make the message cut through. You did all the work. By the way, we lost a little bit of margin because it was more expensive. So I need to get credit for that. So we need to do something that people will notice, right? And because I had a very clear target audience, which was the younger folks, we did something that was very digital by nature, that had. We thought it would have a high degree of virality because of the way it was done. We put a lot of attention on the craft because we know that no one wants to eat a moldy burger. But we made it look mesmerizing and beautiful, almost like hypnotic. On the case study, if you watch, there is a reporter that says, I shouldn't be looking at this, but I cannot stop looking. You know, like we wanted to have that effect. We never put moldy warper in the restaurant. We never put moldy warper in the menu board. We didn't put close to the food. We put where people would see, notice and understand the message. And all the research that we did shows that they did the tour Guapada tour is in my view the best example I can think of on how creativity can bend reality. I tried everything to have people download the Burger King app and use mobile order and payment. It was pretty damn expensive. If I were just to spend in performance marketing to achieve that, maybe even with the expensive price, it would still be worth it because the Lifetime value of those people would be much higher than in 10 or 15 or 20 bucks that you are spending for each person. But I didn't have a big budget, you know what I mean? Like I have a constrained budget. We tried, man, absolutely everything. Like someone on my team said, why don't we just give away Whoppers? And I was like, that's brilliant. Because the Whopper is probably like less than $2 for Burger King in terms of cost. And the cost to have someone download the app and use the app is like more than $15. So I'm printing money by giving Whoppers to people. And we took like 10, 20 restaurants in Miami because Burger King owned, the corporation owned those. And we put like a massive sign behind the counter saying download the app, order the app, get a free Whopper. So cannot think about the best media placement for a message, right? People are in the line to buy the Whopper. In front of them you have a sign that says like download the app and get a free Whopper. And no one did.
- [14:05]
John Evans
They didn't?
- [14:06]
Fernando Machado
No, they did not.
- [14:07]
John Evans
Why, despite getting free?
- [14:08]
Fernando Machado
Because people just don't pay attention to anything. Everyone is on their phone like people, if they saw it. Some people don't want to put the credit card number on the, on the app. People just don't care, you know, Like I, I've been in London for a week now. I don't remember any out of home. You know, like every single bus shelter has an out of home here. I don't remember any, I don't remember any billboard. I didn't watch much tv, but the little that I watched, I don't remember any TV ad. You talk a lot about the cost of doubt, right? But most things are dull. So we did something that was based on the fact that we knew that our fans love a good banter between burger King and McDonald's. By the way, when we do the banter, we don't punch them. You know, that would be stupid. People love McDonald's. Why the hell would punch that? There are more people who love McDonald's, they love me. So it needs to be done with self deprecating tone. Little bit crazy, little bit out there. And this is what the tour was. It was a promotion where you would get, you would be able to buy a Whopper for one cent, but only if you're close to McDonald's which is kind of like a mind fuck. I don't know if I can say that. But when people listen to that, they're like, whoa, wait, wait, Wait, wait, what are you talking about? You know, like, when I presented the idea to the CEO and to the cfo, which, by the way, I used to do that more to bring them in the journey than anything else. It was at the stage where I had, like, full trust from. From those guys. But I said, hey, we have the idea to launch mobile order and payment. And they were like, tell me. And they would present without slides. I would just tell them it was not even in a meeting. It was in a corridor in a hotel, because we were having a workshop. Then I told them, imagine the headline. You'll be able to get a Whopper for a cent only at McDonald's. And they looked at me and they were like, at Burger King, right? You mean Burger king? No, at McDonald's. And they were like, what do you mean? And then I explained, and they died laughing. We were laughing for like two, three minutes. And then I told them, guys, don't give me feedback now. I don't want your feedback. Tomorrow we will meet, and then you give me feedback. But when you come, just remember how much you laughed, okay? And they went home, told their families, their families laughed. The mom told the son, the son laughed, that told the daughter, who also laughed. So they all laughed. So they came back next day. It's like, yeah, let's do it. Because, like, there is little downside anyway. That's the thing that people don't understand. Moody. The tour, even sketches, the budget was not high, you know, like, the idea was so powerful that we pulled back a bit on media budget because it took off in terms of organic coverage, in terms of social charter in, like, Facebook, Instagram, all that.
- [16:56]
John Evans
Yeah, it's funny you mentioned Costa Dao in the presentation. There's a little bit of the presentation that I've become a little bit obsessed about, which is we were looking at. Looking at research about what makes something not dull. And Adam and I came across this piece of work done in 1972, right, as a guy called Murray S. Davis. And the whole study was what makes something interesting. And the summary of all the study was what makes something interesting is when you deny a key assumption of your audience. In other words, you surprise them. So the key assumption of your audience is you only present pictures of food that are beautiful, luscious, desirable, melt in the mouth, you know, the food porn or whatever that people say. And you absolutely denied someone's assumption by doing the opposite of what people are expecting to see. And therefore, you're surprising people. I mean, I know when we did the system One test on. We have not seen so much disgust and surprise at the same time.
- [17:57]
Fernando Machado
In.
- [17:57]
John Evans
The spike rating, which is we work out the short term activation number is derived from how strongly do people feel and how quickly does the brand, your advertising come to mind. On both those things, you were off the scale. You literally just went. It just, you know, because you. It was so arresting, wasn't it, as an image? And it kind of destroys. It kind of challenges the norm in that category in a dramatic way, doesn't it?
- [18:21]
Fernando Machado
Yeah, but what about the tour is the same?
- [18:23]
John Evans
Yeah.
- [18:23]
Fernando Machado
If you think about it, right. I mean, I'm going to do a promotion by sending you to the competitor.
- [18:28]
John Evans
Like, who would do that? You deny an assumption. Like, no one would do that.
- [18:31]
Fernando Machado
Like, what, what are you talking about? And I think that's why it works. I would say that sometimes surprising people with something that there is no reason for being can also grab people's attention. You know, I remember like the classic, I think it's David Ogilvy print ad where the guy had the eye patch and people are like, why does he have an eye patch? Like, no reason.
- [18:53]
John Evans
Yeah.
- [18:53]
Fernando Machado
You know, but you remember.
- [18:54]
John Evans
Yeah, because it stands out. Because you notice the brain is so efficient at processing the world that when something doesn't fit with your kind of mental view of the world, it's like, well, why is that there? And it's, it's.
- [19:06]
Fernando Machado
Yeah. Like, I think that one of the key challenges we have in marketing is how to not conform with the sea of sameness that's out there, you know, and we need to be creative to find ways to do that. Ways that like have a reason for being. Right. I mean, that have like a business objective or like a business objective related to sales or profitability or brand attributes that you want to shift and all that, which ultimately should lead to sales and profit anyway.
- [19:35]
John Evans
Yeah, I mean, it's like the first job of any advertiser is not to be ignored. And I think that's why we do the cost to dark because we're like, you do realize that most advertising is ignored, generates no emotional response and your first job is to be noticed.
- [19:47]
Fernando Machado
It's the classic quote from Bill Bernbach. Right. I mean, one of the founders from zdb, which is if your advertising goes unnoticed, everything else is academic.
- [19:55]
John Evans
Exactly.
- [19:57]
Fernando Machado
But when growing up, like in marketing, I used to spend much more time focusing on whether it's communicating the message and whether it's well branded than on where it would get attention. And as I grew older, of course, the brand should be part of the story. And it should be well branded. Of course it needs to communicate the message. We are not here to just do artistic crazy stuff. But I give a high premium for cut through and attention.
- [20:26]
John Evans
Yeah.
- [20:27]
Fernando Machado
Because if it's well branded and communicates the message and no one cares, unless you have infinite amounts of money to rub that thing in the face of everyone, no one will care because you will not notice.
- [20:37]
John Evans
Yeah. There's a lovely quote. I think it's Greg Hahn who said, I tell my clients they don't have the budget to be boring.
- [20:43]
Fernando Machado
Yeah.
- [20:43]
John Evans
I mean, if you have massive budgets, you can afford to be boring, but for most of us, we can't afford to be boring. You said something at the beginning of the conversation which struck me in terms of creativity is more than advert. I remember a few years ago I set myself a task of trying to work out the five most creative things I've done in my career. And what's interesting is only one of them was an advert. The other, in fact, the fifth one was the top four involve some kind of other business, you know, solving a business problem. I was just curious from your point of view, like, what would you say the most creative things you've done that haven't involved advertising?
- [21:16]
Fernando Machado
Oh, my God. I did. Like, in no particular order. On my first job in marketing, I was a trainee working on fabric softeners in Brazil. And I had never read Philip Kotler. I didn't know what the 4Ps were. I was clueless. I studied mechanical engineering and I was working as an intern in a factory. And I pitched Unilever to go to marketing and they allowed me. So I arrived there on fabric softeners. Unilever had two brands in Brazil. Comfort, which was the more premium brand, and another brand called Fofo, which is kind of snuggle. It's a teddy bear brand. And of course that they are not that crazy. So Fofo had no budget. Right. So I was managing Fofo and I was coming to the meetings with the Comfort team to see what you can do when you have budget, let's say. And my boss, his name was Dimas Mieto, he told me, I came to him and said, hey, I would love to invest a little bit behind Fofo. And he said, well, you won't because there is no budget. And the little budget that we have goes to comfort. But then he said, but if you're able to save some money, you can invest the money that you save. And then what I did was I tried to leverage my background in engineering and packaging to basically find ways to save money. And then I work with supply chain, I work with the guys that like give me the whole breakdown of cost. And I try to like have an impact in cost without changing the quality of the product. So one thing I did just as an example was I had read this research about the fact that color really influences how people perceive fragrance. So I did a quantitative study to check if I put all the, like, if I just had the same fragrance on the three varieties that I had for, for with the same fragrance in different colors, people would notice and they didn't. And the number one product was the blue one, which had the best fragrance and it was the cheapest because of scale. It was like 60% of the volume. So lots of scale, lower cost. So I put the same blue fragrance on the tree, right? And no one, probably to this day, no one realizes. And I say like 300k or something. Wow. And I invested that on creating a bottle that was the shape of the teddy bear, which took me a year to do it. And it was not my idea, by the way. That's the other thing. Great ideas are ideas in the real world, not in the PowerPoint. Right? So that was like in any brand or any company, you have a usually like a pantry full of ideas that people didn't do because it was too difficult, because they were impossible. The teddy bear shaped bottle was one of those impossible ideas. So I leveraged my background in packaging. I had a really good connection with the packaging team at Unilever because I worked for them. I had a really good connection with the factory because I was working there. And I played soccer or football with the faculty team. So we made it happen. And it was the haircut, high sales, no advertising. Imagine how they stand out of that packaging, right? I mean, a teddy bear shape in the sea of sameness of colors, which is the fabric softeners category. So saving money to invest the money to do something. I think there was creativity on both. There was creativity on saving the money. It was creativity on investing on something that people consider to be impossible. I think that's a great example. I think that the other thing, and I don't know, like, I think that I can talk about things that I'm really proud. I'm really proud of the creative culture that we build at Burger King. And people don't realize, but I used to control the budget mostly for the US all the other markets, they were master franchisees. So it's not that they don't report to me, they are completely different company altogether. Right. I mean, sure, like, they need. I have certain boundaries that they can impose, but that doesn't. It's not how it works. Right. You really need to bring people along on that journey. And I don't know if that's creative or not, but, like, I think I invested a ton of time making sure that the brand was clear, that was easy to deploy, making sure that those guys felt part of the same team, making sure that they got the credit for the ideas that they brought to the table, making sure that they saw me as a partner in crime to do great creative ideas. And I'm really, really, really proud of that. Right. I mean, and the fact that they continue to do good work even after I left, to me, that's also our role as leaders to create an organization that is not just dependent on you. What else? In terms of creativity, I think that, like, I was maybe because I was an engineer, I was always, like, very curious about the technology behind the products. So when I was in Unilever and even on nautical too, I used to spend a lot of time understanding how the products work, the ingredients, the claims, how we measure things. You know, like, I remember when I was on Vaseline or when I was on Dove, I spent a lot of time on the R and D center in the R and D facility in Trumbull, Connecticut. I was based out of New York or based out of London for Dove, and I will go there all the time. And I think I helped the guys many times to come up with product ideas that they're still in the market today. I remember when we came up with the idea of launching Vaseline Cocoa Butterfly, which was a lotion, that it was very targeted on African American skin. Back in the day, we had never even done like a test, a functional test of the product, just with African Americans, even though African Americans dramatically over index on the brand on Vaseline. But we are doing clinical tests and product tests and advertising research and all that stuff with gender, population, never with an ethnic group, and that both African American and Hispanic overindex with Vaseline. So we said, let's create a mix that over delivers to that target audience. And then we started to study the way melanin works, the way dark skin reflects light differently than white skin. All the kind of like the science behind skin, behind dark skin, behind white skin, behind how the products work and so on and so forth. And. And we target ourselves to create a product that would improve shine or glow on black skin. Okay. And I Remember that when I explained to the R and D team why we needed that, I remember the R and D team looking at me and thinking, fernando, we don't even have a machine to measure that. You know, like, so. So I was like, okay, so we need to buy a new machine for the lab. And we did. Like, we bought a new machine to measure light reflection on skin. And we design a whole range with a lotion, a thick cream, an oil, and a body butter. Focus on improving the glow and shine of black skin. And I think that's very. I think that's very creative because you understand your target audience, you understand what the needs are, you find an opportunity. And we created a product from scratch with claims that we could not even do before focusing on that target audience. And by the way, the product is still in the market today. The story I'm telling you is, like, probably like 20 years ago, right? I mean, how many products stay in the market for five years? Right?
- [29:15]
John Evans
I love those examples. Amazing. I mean, going back to your first one as well, like, every marketer moans they don't have the budget. Now imagine if you're pitching to the CFO going, I want to increase my budget by 50% or whatever. Your chances are fairly low. If you went to the CFO and said, I found a way of saving money, will you give me permission to reinvest that in the brand? I think many of them would say yes. So, again, creativity in framing how you approach business. It's funny, I remember the most creative thing I worked at when I did my list of five. I was working for a small juice company, and I accidentally found myself on a government committee. I've never been on a government committee before. Right. And this government committee were deciding new legislation for schools, right. And they wanted to reduce portion sizes. They wanted to limit the amount of sugar that kids were taking in. Right. Every day. And they wanted manufacturers to comply. And I was one of 10 manufacturers represented on this committee. And what was amazing is went around the table, all my competitors were going, oh, that's a lot of investment. We'd have to change the lines. We'd have to invest in capital. It'll be loads of complexity to make a smaller bottle. And I sat there and thought, this is amazing. If I'm the one that moves and moves quickly to make this new smaller.
- [30:30]
Fernando Machado
Bottle, you'll be the only one in school.
- [30:31]
John Evans
Exactly. I know. I was like, this is brilliant. Right? So I was listening to everyone else, and of course, I was pretending, oh, it's gonna be really complicated. For us, it's probably an 18 month project, you know, secretly go right, when I get back to the factory, we're doing this now sort of thing. And they only get the legislation was gonna come in in six months. Now working in drinks, usual product, usual products, you know, from idea to, you know, execution is probably 18 months actually.
- [30:55]
Fernando Machado
So I would say two years.
- [30:57]
John Evans
Yeah, really extreme short. So I thought as a small matter of fact we were, we were the sort of 10th biggest, you know, we were literally the, the small ones. I thought, right, I'm going to, I'm going to be the first to market and, and get in there now. I, I lined, I got all the suppliers together, said how do we do this 18 month project in six and got everyone working together on it. I flew out to Germany to sit with the designer of the bottle and I did it on the CAD machine with him going, well, if it a bit more like this and do this and really good fun. But anyway, the creative bit, apart from wanting to do it quickly was in the uk, the biggest supplier to schools is a big organization called Compass Group. They're huge global caterers. They employ tens of thousands of people and about, I think about 30% of all schools in the UK are done through this one wholesaler. And of course they've got big agreements with all the big Coke and Pepsi and everyone else. And anyway, they had a pitch to see who could, you know, who could supply these new school strengths. And I'm like, brilliant. I've got a brilliant chance. I'm going to be first to market. You know, I've got this funky brand, it's going to be amazing. And I totally lost the pitch, right? I was in the feedback, they said, you are at least twice the price of the price we're getting from, you know, from Coke and everyone else. I'm like, oh, damn it. I was really disappointed and I got an extreme bit of luck because having lost the pitch, I must have been on boarded as a supplier during the process, you know, to go through the pitch process. And they, I got a letter from them saying could I come and pitch my brand plan for next year for Compass Group? So basically I got invited to a conference and they said, you've got 45 minutes in front of the select, you know, the committee to pitch us your idea for next year. And I thought, do I mention that I'm not even listed right? And I thinking, do I tell them that I, you know, my price was all too high and I thought I'm going to go assuming that I am listed and go through the whole exercise as if I'm. As if I'm actually a legit supplier. But then I thought the issue with contract catering is that you agree to supply the wholesaler and then you have to have a sales team that go around each school and basically sell into each school, right? So they, you know that you do a central deal and then you go to a school. I had no sales team anyway, so my idea was this, right? I went and pitched at their, at their big review day for the suppliers and I said, the number one issue we've got in the country is that kids are not leaving with the entrepreneurial skills and the business skills that they need to be successful in their life. So here's the idea. I'm going to create the Juice Burst was the name of the drink. I'm going to launch the Juice Burst Entrepreneurs program and I'm going to run a program. Whereas in schools, we're going to get kids to manage the soft drink fixture in the canteen. They got to buy the drinks, they've got to plan what they do, they've got to manage the inventory, they've got to run promotions. And we will give them the kits that they need and we will give them, I'll make a video telling them how to do it and all this kind of thing. And we will get the school kids in all your schools to learn the skills of business by running the canteen, you see. So I basically turned the kids in the country into my sales team.
- [34:03]
Fernando Machado
And.
- [34:03]
John Evans
I won a prize. I got this award from Compass for being my contribution to education award from Compass the end of that year. And I was never. And the irony was I was not a supplier. They had to list it at full price. So there's no negotiating on the price because I just said it's got to be full price. Price or nothing. They paid full price and they, they ended up allocating my brand to every school on the basis that I was going to do program.
- [34:34]
Fernando Machado
But like, don't you think that like, at the essence of that is like another. A deep understanding of what is value to the consumer? The consumer being the school, right? Because like, I bet that most people go there to pitch and they say why they are great or like why you should work with us, right? And you went there, it's like, guys, what are you trying to achieve? I will help you. Because what you're trying to achieve is not to have juice in the school, right? That's not why you open the school. We open the school to educate Kids so help you with education.
- [35:06]
John Evans
Yeah. In fact, there were two customers that. You're right, customer number one is the school and what they need to do and help them to do what they're theirs to. The second thing is the school can choose which caterer it uses.
- [35:17]
Fernando Machado
Yeah.
- [35:18]
John Evans
So Compass needed a reason to be the. The preferred caterer. So what they did, well, the reason they loved it is because they went to every school and said, we've got this entrepreneurs program. We'll give you for free and we'll give you a pack to the kids and we'll help educate them. And so it enabled Compass to be the preferred supplier for each school. In return, they had to take an order of juice burst on every. And it was amazing actually. So we increased the company turnover I think that year by about. At least. I think it's about 20%. It was the most. It had the biggest single contribution to our company growth. They became our biggest customer. And number two customer. Actually number two customer within 12 months.
- [35:56]
Fernando Machado
Amazing.
- [35:57]
John Evans
Because that at full margin. I should mention the full margin, but in case they're listening. But you know, but they were very happy because like, you know, contributed.
- [36:04]
Fernando Machado
Yeah.
- [36:04]
John Evans
I just showed creativity.
- [36:05]
Fernando Machado
Come over. I love that Case.
- [36:07]
John Evans
You know, I wanted to move on and talk about CMOs. You've. I had Seth Matlins on the podcast quite recently and of course at Forbes they celebrate the most influential and the most entrepreneurial CMOs. What. What tips would you give? I think you've won it like three years. Not one it's. But you've been nominated on the list three years in a row. What are the secret ingredients to being kind of an influential cmo?
- [36:28]
Fernando Machado
I don't think I ever tried to be an influential CMO outside necessarily of my teams. You know what I mean? Like, and I think that was very fortunate with the fact that I work on brands that have a lot of visibility and that a lot of the work that we did did do really well. And that allowed me to be on stages which help promote the brand, the company. And people end up like getting to know me. Right. I mean, where it was the first time, just as an example that I presented in Cannes Lions, was when I was on Dove, then with Burger King. We presented a bunch of times in a row then with Activision Blizzard. But those are like big platforms in terms of brands. Right. But my focus was on like using creativity to drive a better business and brand growth, better business result and brand growth, creating a creative culture wherever I was. Whether it was Unilever when I was A little bit more junior. Whereas the CMO for rbi, which was Burger King, Paul Puzzling, Tim Hortons or Activision Blizzard. And when, when I get a recognition from the industry saying like, hey, you are an influential cmo, like, it's very flattering. And I think it happens because the type of marketing maybe that I was trying to do was a bit different than what was out there in many cases, not in all cases. I think that there are lots of great creative CMOs out there too. But it was never the intention, you know what I mean? Like, I really just wanted to create an impact where I was, you know, like, and build a strong team. Like the fact that like I still have like a great relationship with like the folks from Burger King or from Activision Blizzard. Like, I know that you're going to talk about the Lions growth MBA program, but like there are people there that were from my teams before, right. I mean, I think it speaks volumes about like the type of relationship that we had with each other. I mean, that was the objective. You know what I mean?
- [38:29]
John Evans
Yeah. I think consistency is really important, isn't it as well? Because you've had consistent agency relationship. You talked about internal team relationship, the culture. You referenced culture as being one of your most creative acts as well. So important, isn't it? Because that creates the environment through which you can then be successful.
- [38:46]
Fernando Machado
It's not easy, you know, Like, I think it's not easy to be a cmo, period. And I think it's even harder if you want to lean into creativity. Most of the companies out there, their CEO is usually not someone that has a marketing background. There are exceptions to that. But there are exceptions. If you, if you look, if you pick like all the big companies, there are only very few that have someone who was either a CMO or had a career in marketing. Usually someone who has a commercial background, sales background, finance background, sometimes even legal, right. I mean, ends up like getting this the CEO role. And because of that, I don't think that they are necessarily betting strongly on creativity to drive growth. You know, like to me, creativity helps you do something different and going back to your point, not be dull. Right? I mean, and like don't have the money to be boring, but every time you try to do something different, it will come with a little bit of uncertainty, right? If you knew exactly what would happen, it's because you probably did a couple of times before, which means that's not that different. Right? And because it has uncertainty is natural. The epithelium brain kicks in and like and you are afraid it's a protective mechanism. So it is usually like an uphill battle to do that.
- [40:10]
John Evans
Well, interesting. Part of the reason we wrote Costa Dao is to put a price on the risk of it's more risky to be safe and more expensive to be safe. But you just don't realize. So the whole point of Costa Dal is to go you actually costing yourself a lot of money by not doing.
- [40:27]
Fernando Machado
But I bet with the perceived risk, I bet whatever you want and I think it makes total sense and I've read a lot about this and bought research and all that stuff. But it's, it's a weird thing, right? It's a contradiction that when you put rational arguments to people that are rational is still they cannot rationalize those arguments.
- [40:48]
John Evans
Exactly.
- [40:49]
Fernando Machado
So even if you show that 1 +1 equals 2 and that probably like you need to spend 9 to 10x more, if you have something that like that doesn't cut through when presented, something that will cut through depending on the culture you are in and the type of leadership you have on your company, people struggle to pull the trigger. You know, like there is a quote from Zuckerberg which is the biggest risk, not taking any risk. Right. And it's true, right. I mean, but like, but sometimes people are fine with that. You know, they are fine of like not taking the leap of faith and just doing more of the same. Just give me what everyone else is doing and, and it will not work. And they will find that it's because of the recession, it's because we didn't put enough media money. It's because competition is because the price and because the retailer, they will find a reason to blame. And sometimes the reason is that you didn't push hard enough to be different.
- [41:49]
John Evans
I totally agree. You mentioned earlier as well that if you're in a big company you might have the budget to be boring. If you're in a small business, you don't have the budget to be boring certainly. And you have to be more creative. Now I know you've recently started working with a private equity company, haven't you? And presumably you get to see across lots of different industries, lots of startups, scale ups, organizations. What's your advice to someone maybe in that phase of the life cycle compared to a Burger King, which is.
- [42:15]
Fernando Machado
Yeah, look, I will answer that but like from my experience, I work on brands that were the number one in their respective categories. You know, like Dove was the number one soap in the US on Activision Blizzard, Call of Duty was the number one game in the world. Like even if you are the number one, even if you are a very large company, I promise you, you never have all the money to do everything you have to do, you know, because if you do, your boss will cut the budget, your target will remain the same. So it's never like that, you know, like you always like in Brazil and all the expressions in Portuguese from Brazil, they don't translate well. But like we say that's like the small blanket game, you know, like you cover your head, your feet are cold, you cover your feet, your head is cold. So that's how budgets work, you know, like it doesn't really matter even if you have a larger bed, you proportionally, you still have a small blanket.
- [43:06]
John Evans
Yeah.
- [43:07]
Fernando Machado
So you will suffer no matter what. Now when it comes to startups, I think that my, my journey with startups started with NotCo. So I was CMO there for a short period of time. I became an advisor, I'm still an advisor on NotCo. And I just felt that I needed, I love the startup mentality and I always said that though I had never worked in a startup before, so what the hell did I know, right? I mean, in terms of that. And then I felt that it would be fun and interesting to work with more than one startup at a time. And so when I left notcom and became an advisor there, almost at the same time I received the invitation to join Ghana Station Partners. Ghana Station Partners is a private equity firm based out of New York. They're very focused in the US and they have businesses that they are usually like the first like investment in businesses usually like small, medium size, medium being half a billion small, probably being like a 20, 30 million revenue strong, like regional businesses that are doing really well, that are growing a lot so there's no turnaround story. And they come to help scale that business. Right. So it was funny the first time I met Matt and Alex, who are the true founders. I was brought in by Alex Macedo who was the president for Burger King North America when I joined. And we were good friends even from before we went to INSEAD together. So we knew each other for quite some time. So Alex brought me to meet. Matt and Alex were the founders from GSP. And in little like 15 minutes talking to them, they are super young, very open minded, very personable. Right. Different. Different than what I thought private equity would be, you know, because private equity, I always thought it would be very finance, very suit up, you know what I mean? Like, and they were not.
- [45:04]
John Evans
Yeah.
- [45:05]
Fernando Machado
And in like 20 minutes talking to them. They were like, oh, we want you to come and work here. And it was like, okay, but like, what would I do? And they were like, we don't know. Yeah, but we think you would do well. So I said, why don't you allow me to take a look in two, three, two, three different companies and then give me like two, three months and I can come back to you saying like, hey, I think I could be doing this. So I went and took a look at Fat Tuesday, which is kind of like, it's not like a bar. They sell like frozen daiquiris. Daiquiris I always mispronounce. So people, my friends are going to laugh of this because I always mispronounce the word. So they sell that they have in Vegas, they have in Miami, they have in a couple of different places in the U.S. i took a look at Pollo Tropical. Pollo Tropical is a restaurant chain very strong in Florida. In Florida everyone will know Pollo Tropical. And I took a look at Wolfgang, which is like a pet grooming business. They also have like products for, for, for dogs. So I went, took a look at that and they had good marketing teams and they have awesome brands and they had okay design and good innovation pipelines. But there were lots of opportunities. Like, I mean you bring someone like me with 30 years of experience in CPG, fast food, QSR digital with Activision Blizzard, you end up like seeing lots of low hanging fruits. You know, maybe the team, the marketing team is a bit younger, right? Because they are a smaller company. So I came back to Matt and Alex and said, hey, here's my idea of how we could have a marketing operating framework for GSP. And I started to present. My presentation had like 40 slides. I think I presented 12 of the 40 and they were like, okay, okay, enough, we like it, let's do it. And then I think that going back to my point on Burger King, when I was able to establish, I think I did a good job establishing a creative culture and having people moving to the same direction in terms of the brand and the ambition we had with that brand across all geographies. Even though they didn't report to me on private equity, it's the same thing. Yeah, they don't report to me. They have a CMO on the brand. But I'm able to influence because I've learned how to do that with Burger King and we get really well with all the marketing teams of all the brands. They see me as someone who understands that and can pick up fights sometimes with their CEO. Sometimes with Ghana Station partners, we don't fight really. But I can help make them be understood. I can help make sure that giving confidence to them that whether what they're doing is the right thing to do, I can help them stepping up in things like design, performance, marketing, CRM, all those things because maybe they don't have as much experience with those things. For the founder is really reassuring to have someone on the private equity side who loves the brand and understands the brand. Because as much it is a commercial relationship with the founder, it's also very emotional. Right? I mean the brand is her or his baby, right? I mean it's difficult. Like it's your baby and you're only talking to finance people. Wait a second, what's going on here? Now there is a marketing person and honestly like so having the opportunity to work with pet care, a chicken chain, alcohol, B2B, they have like all sorts of businesses. Like I feel I'm, I think that I'm, I keep learning, you know, that's the other thing. I always try to position myself in a position that I can learn and I'm learning fast. All, I think all the career decisions that I made throughout my career were based on that. Yeah, I always want to learn cpg, qsr, digital private equity. And then just to finish that one answer, like, they are awesome. You know what I mean? Like, I feel appreciated, I feel welcomed, I love the culture and it has been tremendous fun to work with the guys from Ghana Station and with the brands that we have, with the companies that we have.
- [49:16]
John Evans
I had a very short stint in a product. Well, actually when I was selling the juice brand to Compass, that was a private equity scenario. And what I loved about how it was how crystal clear their thinking is and how they're biased for action. So. Oh yeah, they were like, the proposition has to be super clear. Right?
- [49:33]
Fernando Machado
Yeah.
- [49:34]
John Evans
And then, then the second thing they would say is you need to get the best design company in the world to bring that to life. It has to be incredibly clear. The next thing they then did is invest in capital to enable you to kind of improve margin and expand volume really, really quickly. And then the fourth thing they would do is they would hire talent from within the industry. They used to call it two rungs above. That was their phrase, right? We don't just want a marketing director, we want two rungs above in terms of equivalent experience. You over kind of invest in the right kind of talent. And then one of the best jobs they did, which I just thought was so clear, is on Day one, they asked me to write the investment memorandum for the exit. Right. So the very, very first day they said, you tell us the category case, the financial case, the operational case and the brand case, renovation case for why this company should be sold in three years time. You write that today. And so you have to think through where are we going, what's the order? It's so good. But what I find compared to being in big businesses where you go through lots of negotiation and you have to kind of align with everybody is everyone's kind of focused on the same outcome. It's very crystal clear and you don't waste anything.
- [50:46]
Fernando Machado
I completely agree with that.
- [50:47]
John Evans
So focused, isn't it? And I think the pure purity of that task just means you get so much done, you move so much more quickly and they do less layers.
- [50:57]
Fernando Machado
Less layers. Very clear point of accountability in decision making. And everyone has the same exact target. I think that in the case of rbi, it was very different than Unilever and other companies that I know about because the immunization was very focus on the variable side and in the valuable side was very similar to everyone. So that I know it's not solely private equity, but we are forced to roll to the same direction. You know, on private equity there is no like, there's no bonus. Like the bonus will be when we sell.
- [51:34]
John Evans
Yeah.
- [51:35]
Fernando Machado
You know what I mean?
- [51:35]
John Evans
Like, and so everyone, everyone's incentive to maximize value. Yeah, yeah, yeah. Everyone takes short term, paying for long term gain. We must make sure we talk about the Lions growth NBA which has just launched. So congratulations on that.
- [51:49]
Fernando Machado
Thank you.
- [51:50]
John Evans
Where did that come from and what is it you're trying to do for the industry?
- [51:54]
Fernando Machado
It was an idea that came about like around a year ago. You know, I was always very close to gun lions. Right. I mean the award show, it's one of my favorite weeks in the year to go there and connect with everyone that I don't see every day and just be inspired by like what our industry does, you know, Like, I'm not like I'm a as any good Brazilian. I'm like hopeless optimistic and I'm always seeing the positive. And I'm a very passionate person about creativity and our industry in general. Like, I see sometimes people complaining about the industry and saying that it's not as good as it was in the past. I don't think so. I think it's awesome and it only gets better. So I always had a very close relationship with them. I was the dean of the Kern Lions brand marketer Academy last Year. And while I was there, I had, like, a lot of, like, breakfast and lunch with Steve Layton and Gail, who are the two people that, like, manage, like, learning and, like, that size of that side of, like, of the franchise from Lions. And I had this idea which I have been thinking about for quite some time around, like, creating a marketing course. I love presenting. I love teaching. Like, I love coaching my teams. And after you have, like, 25, 30 years of experience doing marketing anchored on creativity, you end up, like, learning a lot. Many of the things that. The way I approach things many times is not based on something that I read or something that I saw is based on trying different things and learning by doing, right? So from how to craft a brand positioning or how to write a good brief or, like, how to nurture an idea or how to develop your creative criteria, craft all those things. A lot of the way. The way I do things is based on what worked for me, right? And I thought it would be cool to share that, like, with more people beyond just my teams, because with my teams, I'm doing that all the time. So I pitched that idea to Gail and Steve, saying, like, hey, what if we create a course that, like, that has, like, a component just like me talking about the cases that I did, showing what went well, what didn't go so well, showing the struggles. Because when people just look from the outside, they think that we're kicking an open door all the time. And they just look at the case study that went to where everything works well. When you got 10 billion impressions and you grew 20% and this and that, they don't see that's not that easy. And that even if you're doing well, you are, like, breaking rocks and people don't see. So I really wanted to show that, you know, to show what it took to show what I've learned. I remember the first brief I wrote. It was total crap. You know what I mean? Like, maybe the first hundred briefs that I wrote were total crap until I've learned, and I learned by doing, not by reading somewhere. So the course has 11 chapters or modules. It's online. Every module will have, like, a masterclass, which is like an hour, hour and a half of me talking and showing frameworks and case studies that I did. I only present stuff that I did I don't talk about. And that's why we also have interviews, because I also brought people to talk about the work that they did. You know what I mean? Like, never talking about someone else's work. And then so each module has A masterclass, interviews, optional materials. And we have a couple of live sessions in the middle to interact and to do Q&As and have some guest speakers coming to surprise the class. And I'm super excited about it, you know, like it was really like a labor of love. Lots of people contributing in terms of the content, in terms of the commercial side, in terms of the production of the content. And we launched this week like we are now like almost like mid April, right. Of 2025. We launched this week. We have a community forum which is kind of like a slack Facebook with the students. I have been very active there. They have been very active there. We had a welcome call earlier this week. We had more than 120 people showing up for the welcome call. I thought it would be like 20 people, I'm serious, for the welcome call. We had almost the full crowd there and people were very engaged. So even though it was a lot of work, the excitement that I get, the kick I get in the whole team about the engagement. People from Coca Cola, Kraft, Heinz, AB, InBev, Mohsung, Coors, Heineck and Sigma, Unilever, Activision Blizzard. Indeed. There's like some agencies, which is great. That's good because I really think that it helps when marketers come with their agency to establish a common language, a common ambition. Yeah. So I'm super excited about that one.
- [56:57]
John Evans
Fantastic. Great stuff. And if anyone wants to get on the course, is it running in cohorts or is it ever?
- [57:02]
Fernando Machado
It's running in cohorts. Like we have the cohort that just started now. The next cohort starts in September of this year. We will keep the other things. Like we will keep interviewing people. So even if you did cohort one and we did an interview with someone on like in August for instance, you have access to that material like ongoing. And I can tell you already, like even though it's like week one, they already a community, you know, like they have their WhatsApp group. Like they are meeting up like we are going to meet up in Cannes. Some are coming to Cannes. So it's really, really exciting to be part of that. And look, I mean if you just Google Lions, Growth mba, the link will come. Go there. There is the whole program there. We have interviews with people like Susan Credo, Goddess Rivera, Brian Collins from Collins Design, Sara and Lisa from jkr, some other design agency, Anselmo Ramos Rik and Juan, with whom I did lots of campaigns for Burger King and for Notco and even for Activision Blizzard. Who else? We Have Nina Patel from Kraft Heinz. We have Mike Dubrick from Rethink. So it's a really great crowd. Every interview, like Steve Miles was my boss on Vaseline ndav. Every interview has kind of like a center of gravity. And. And we have then in the respective module which they belong based on the center of gravity. I also interview Brent Smart, by the way.
- [58:31]
John Evans
Oh, cool. Yeah.
- [58:32]
Fernando Machado
And James Harmon. Like, Brent, we walk in Bondi Beach.
- [58:35]
John Evans
You toured down Under, I see. That was a tough day at the office, wasn't it?
- [58:38]
Fernando Machado
Oh, yeah, it was a Friday. I would take that as an excuse, but, like, that's the thing that we did the interviews in a way, I only interview people that I knew and that I liked that has a vibe, you know what I mean? Like, and we tried to do in a way that was entertainment, you know, like, so brands took me to have like a snow cone, like on Bondi Beach. James Herman. We walk in Auckland, like in a. In a really nice port. And then we went to previously unavailable. So it's always like that. We start outside cool place. And then we go to some sort of office to be a bit quieter.
- [59:13]
John Evans
Fantastic. Well, congratulations on that.
- [59:15]
Fernando Machado
Thank you.
- [59:15]
John Evans
Sounds very, very exciting.
- [59:16]
Fernando Machado
It is, it is. As I said, it was a labor of love. A lot of work, but it will pay off. You know, like, I think that a lot of people can. Can benefit from that.
- [59:26]
John Evans
Amazing, Fernando, amazing as always to chat to you. Thank you for sharing your. Your wisdom and your pleasure. It's been great to have you on again and good luck with the next chapter.
- [59:34]
Fernando Machado
Well, we need like first time was real.
- [59:37]
John Evans
It was.
- [59:38]
Fernando Machado
We only support to Miami.
- [59:40]
John Evans
I'll drop in at you. Drop it on your place.
- [59:42]
Fernando Machado
Look, there is a. There is something that Paulo Coelho, who is a famous Brazilian writer, said once, which is there are things in life that only happen once and they may never happen again. But if something happened twice, it will definitely happen a third time.
- [59:55]
John Evans
There we go. There we go. You're on. You're on. My Mrs. Amazing. Look forward to it.
- [59:59]
Fernando Machado
Thank you.
- [59:59]
John Evans
Thank you. Thank you very much for listening or watching Uncensored cmo. I hope you enjoyed that. If you did, please do hit the subscribe button wherever you get your podcast. If you're watching, hit subscribe there as well. I'd also love to get a review. Reviews make a big difference on other people discovering the show. So please do leave a review wherever you get your podcast. If you want to contact me, you can do I'm over on x at Uncensored CMO or on LinkedIn, where I'm under my own name, John Evans. Thanks for listening and watching. I'll see you next time.