Chris Burggraeve has seen the world of innovation and marketing transformed in his more than three decades in business. Having trained at P&G, he went on to head up marketing for Coca-Cola in Europe and Eurasia before being named Chief Marketing Officer for Anheuser-Busch InBev. In 2012 he launched micro ventures firm Vicomte, translating his 23 years of big business marketing expertise for companies that needed to “speak better CMO”. Through Vicomte, he has been actively supporting startups and scale ups at the cutting edge of new frontier industries, such as cannabis. We talk to Burggraeve about creating cannabis 2.0 at TOAST, and why companies should be thinking and acting galactic.
What led you to launch Vicomte?
I wanted to go back to my first love – helping young companies to create bold and scalable solutions for real world problems. Vicomte is all about creating renaissance brands, iconic brands with sustainable pricing power. To get there, it is critical we break the extremely narrow definition of marketing in boardrooms today. Vicomte demystifies Silicon snake oil, and refocuses everybody on the true fundamentals of marketing. Vicomte also actively invests in industries at the cutting edge.
What’s your approach to investing?
I have an ownership mentality. Most of my consultancy is about long-term relationships, and semi-ownership. Where possible and relevant, I prefer to have skin in the game – so I put my own money and reputation in. I share my expertise, but often end up as a senior coach or mentor, or even the (executive) chairman. The latter role requires the right level of empathy to balance the needs of the business, of the founders, and of all the stakeholders. It requires patience, and a willingness to manage high levels of ambiguity and uncertainty. But I find it very rewarding. Of course, this type of investing requires a VC-like portfolio approach, including acceptance of complete failures and lower than expected returns. Luckily, occasionally you strike the gold that makes everything worthwhile, like when we sold Flashstock [a platform that creates custom imagery and videos for leading brands], to ShutterStock.
What’s your approach to innovation?
I advise clients to think of innovation in a continuum, but focus on the existing business first. When you ask people ‘who wants to work on innovation?’ Everyone raises their hand. ‘Who loves change?’ We all do. Then you ask ‘Who wants to change themselves or work on their existing business?’ No one. Yet 99% of salaries and everything that makes things happen today, comes from the existing business. Innovation can be a siren’s song. I like to split it into two steps. First there is renovation – of your existing products, services, or business model. Renovation gives you low-risk, necessary, incremental growth. Then there is innovation, linked to the riskier, longer term stretching of products and services, all the way to the potential complete reinvention of your business model. To me, it’s critical the majority of your resources are dedicated to optimise the base business. Ensure your core operations are going as strong as can be. Then dedicate some specialised resources to creating for the future. The key learning to me, is recognising the siren’s song.
Digital services transformed marketing. What impact will AI have?
Everything can be disrupted, even the fundamentals of marketing. If you accept the premise that emotion is really the basis of most decision-making, and that our whole marketing ecosystem is geared to analysing and amplifying emotion, what do you do when AI becomes a part of everything? Right now, it’s still external to our brain – it’s in our phones, for example. But what about when it physically becomes a full part of us? When we become some form of cyborg, what will happen to the underlying basis of marketing? Emotion-based decisions may become purely logic-driven. In that world, is the idea of choice still relevant? Or will we just not care anymore and live some lifeless existence. I hope that’s not the case.
How can companies prepare for such vast, unpredictable changes ahead?
There are multiple ways to future proof your brand. In my workshops, a simple but effective approach I use is to take your brand name and add the word ‘galactic’ behind it. It inspires the team to deeply reflect on the purpose of the brand over the next 50 years, the Space 2.0 period we just entered. I showcase how space has impacted our way of life on Main Street in the last 50 years, more than we ever imagined. And then I depict how the impact in the next 50 years will be exponential, and why that is a great canvas to paint future scenarios on.
Why will the impact be exponential?
Because now all the biggest global tech companies, themselves exponents of Space 1.0, and all world governments are going all in. We need to move beyond our paradigm of the last 50 years of thinking local and global. It’s time to connect local and galactic. Think about bringing people together on a universal scale. Learn from the so-called “overview effect”, impacting astronauts in space: when you are far from Earth, you don’t see borders. Thinking galactic means embracing a positive mindset for your brand about the survival of humankind, and about the smart evolution of an emotion-based society worth living in.
Back on Earth, why did you decide to move into cannabis?
TOAST was built on the insight that it was time to elevate a very unsophisticated experience: smoking a joint. We first created a new language. We don’t talk about joints, we talk about a slice of TOAST. And we packaged it in a beautiful, luxury design. We try to think, ‘if we were an outsourced arm of a luxury conglomerate today, how would we do it?’ TOAST was designed to meet the underserved needs of 100 million new people willing to enter a contentious but fascinating category. That meant offering a nicely branded solution that balanced “sin & soul”. We needed to respect the intrigue and expected product delivery alongside peoples’ lifestyle and values, within the boundaries of the law. Because TOAST’s purpose is to help turn a large black market into a white market.
How can you transform an entire black market?
By inspiring consumers to choose a better and safer experience, at a reasonable premium. We launched TOAST in Aspen, Colorado, because Colorado was the first state that went legal and Aspen embodies the TOAST values of quality and luxury. We’re also obsessive about product integrity, because we’re selling trust in a box. We’re adamant about building a brand with sustainable pricing power, based on marketing fundamentals.
What is the biggest challenge facing cannabis startups?
Besides cash to grow? Regulation. Many other indulgence or more delicate new frontier categories – including coffee, sugar, gambling, pornography, mobiles, blockchain, AI and cryptocurrency – have found a happy equilibrium between smart regulation and entrepreneurship. Cannabis and hemp are in the foothills of finding that balance. There’s a natural tendency for regulators to listen to pressure groups that want to impress their values on democracy, and to over-regulate. But the reality is the black market is still winning. People have a deep desire to meet their guilty pleasures or solve their medical issues, and they will find solutions for it on the black market.
What’s your message to regulators?
Legalise, and allow oxygen to the white cannabis and hemp businesses. If you really want to grow this category you need new people to come in. They need to trust brands and access quality products at an acceptable price. Too high taxes result in achieving the exact opposite: rather than reducing the black market, it will accelerate it. Tax companies when they are bigger, not when they are growing. I’m on the side of the least regulation necessary to achieve a societal goal.
After all, what’s the one undesirable societal thing alcohol prohibition created? The mafia.
Want to learn more? Read our special report on cannabis derivative, Innovation in Action – The CBD Edit.