The pandemic and lockdowns caught brands and businesses unprepared, but as the experience of Mastercard shows, a specific risk management function within marketing helped it respond more quickly and effectively to the situation as it developed around the world.
CMO Raja Rajamannar set up such a function three years ago and that decision has paid off during the current pandemic.
It’s fortuitous, he admitted at the recent Festival of Marketing conference – like most businesses, he didn’t foresee the coronavirus – but “the building blocks that we had put in place came in extremely handy”, he said.
While the coronavirus may have surprised many people (although pandemics have been a recurring feature of human history and, post-SARS, more were predicted by the experts), there was no shortage of other risks that a marketing team could easily consider.
“Cybersecurity is an ever-present threat, you’ve got financial risks, you’ve got third party risks, you’ve got data privacy risks,” Rajamannar enumerated some of them. “You have to be able to contain those risks and that’s going to be one of the success factors for marketing as we go forward.”
So he moved his CFO into a new role as head of risk management and tasked her with looking at every element of risk that marketing faces. Having identified the risks, a heat map showed “the probability that a risk might materialise; and if it does materialise, what is going to be the extent of the impact on the business”.
In this way, it has been possible to rank risks and understand what areas need to be watched most carefully.
At the same time, individual risks were assessed and mitigation or avoidance plans drawn up: “avoidance to make it not happen, but if it is beyond our control and it does happen, then how do we mitigate the risk, and how do we not miss a beat as far as the regular momentum [of the business] is concerned”.
For more details on building a risk management model, read WARC’s report: Mastercard’s risk management playbook for marketing.
Sourced from WARC