USG Corp may not exactly be a household name, but chances are good that you live in a house created from its products.
The Chicago-based company is a leading manufacturer of building materials such as Sheetrock drywall systems, roofing, poured flooring and numerous other essentials. When the housing downturn hit about five years ago, pretty much half of USG’s capacity suddenly wasn’t needed. But the company’s fortunes are on the rise, thanks to a rebranding effort that relied heavily on an Olympic sponsorship and internal advocates serving as ambassadors for the brand.
“Today, our stock price is up 600% from those dark days,” said president, chairman and CEO James Metcalf at the BMA conference this spring. “We made money last year and that has allowed us to strategically invest in marketing—that’s a big shot in the arm.”
“Think about how heavily the recession impacted the building industry—it was pretty dramatic,” says Linda McGovern, vice president of marketing for USG. “Over 70% of our market went away at the beginning of the recession. Housing went from over 2 million new units per year to 550,000. We have about half the people we had five or six years ago—we went through seven rounds of restructuring. Housing is a very cyclical business in general but this hit was the hardest and longest.”
Revenue dropped 50%, shipments went down 65% and the stock price plummeted. The company’s invoice-paying customers are primarily independent specialty dealers, big-box retailers like Home Depot and lumberyards. But much of marketing activity is geared toward influencers, such as general users, remodelers and architects. The company also owns its own specialty distribution chain, L&W Supply.
A New Blueprint
Rather than giving up, the executive team at USG looked at the situation as an opportunity, notes McGovern, who has been with USG for nine years, and was previously with Baxter Healthcare and the truck company Navistar. “We had to rethink our strategy and strengthen the core of our business—we needed to diversify our earnings by looking at new markets and adjacent business, and differentiate ourselves through innovation.”
Overall, the company needed to look at products and services that were potentially less cyclical, and make sure that the company’s organizational structure matched up to how they wanted to go to market. USG had traditionally focused heavily on wallboard, a core product offering the company actually invented over 100 years ago. But it was time diversify how it positioned itself not only domestically but outside North America as well.
Prior to the recession, USG had already been thinking about how it was positioned in the global marketplace, and had done some strategy work with the branding firm Lippincott. When the recession hit, though, that was put on the shelf until it was a better time to relaunch the brand.
CEO Metcalf was very purposeful about how and when USG should relaunch. “We wanted to demonstrate that we had a renewed focus, both internally and externally,” he says.
The timing of the relaunch was a big concern. Internally, many people had been through a rough few years with no wage increases, so the brand needed to be careful about introducing the rebranding idea. “Our CEO wanted to be sure they knew that we still wanted to invest in our people,” noting USG held off until it demonstrate reinvestment in its employees to increase internal confidence.
An extensive Olympic sponsorship was a major part of the rebranding initiative, and there were three other main components. “We wanted to make the new brand about people first and drive better engagement and recruiting, making sure our people were on board,” she says. “We also wanted to be a global organization, and leverage our brand to drive new business.”
USG was purposefully secretive internally about the rebranding initiative, to create a sense of mystery and excitement. Aside from a small core team, no one in the company knew what was about to happen. After the plan was in place, McGovern’s team reached out to 40 individuals from across the company to pull them in on the plan.
“We needed evangelists who could talk about this from day one, and get the point across that this was more than a cool new logo,” she says. “We wanted to find ambassadors at every level in the company who could influence the people around them.”
The company sent letters via FedEx to people in department in every part of the company, from executives to manufacturing to sales, inviting them to Colorado Springs for a leadership summit.
“We wanted to go beyond the usual suspects and find unsung heroes who excelled in their departments,” says McGovern, noting that even the managers of the invitees didn’t know what was going on. “The [invitees] had to sign NDAs, couldn’t take pictures of the event and couldn’t tell their spouses or managers [about the event].”
When the ambassadors arrived in Colorado Springs, they met with the core executive team at the Olympic Training Facility. On day one, the CEO unveiled the new branding strategy and explained why the company had chosen to invest in it. The Olympic sponsorship of Team USA and Team Canada was also explained, and athletes were on hand to help build excitement as the Olympic Torch was lit at the training center.
On the second day, the ambassadors divided into teams and played various sports that tied back into various business concepts. For example, shooting conveyed the idea about being focused on your target, judo explored the idea of using your weight to your advantage and sitting volleyball was all about overcoming obstacles.
The following day, Oct. 1, 2013, the ambassadors were each sent to one of eight cities for an employee meeting. Employees thought they were going to a typical road show event, but this one was conducted as a live simulcast. Each ambassador was given a specific role in his or her local event, along with tasks the ambassador would continue in future days to drive excitement.
McGovern and Metcalf participated in the simulcast, which was hosted by sportscaster Greg Gumbel live from Colorado Springs. The newscast format simulcast explained the rebranding through a “60 Minutes” style interview format, talking about the brand, new logo and the Olympic sponsorship. After the simulcast, employees at each location had the opportunity to ask questions of the ambassadors and executives, and meet with athletes.
What’s the ROI?
To gauge the internal success of the rebranding effort, USG looked at employee sentiment. Last September, an employee survey was conducted to get benchmarks about how folks felt about the company. Six months later, a follow-up survey showed double-digit increases in 12 of the 14 areas measured. The follow-up survey also showed that internally people understood and approved of the Olympic initiative. “These results are great—we set out to educate and engage internally first, because our people are critical to our success,” McGovern says.
Similar metrics were looked at for outside audiences like distributors, contractors and architects. The increases there were promising, particularly since there hasn’t been a lot of external advertising done around the new brand yet, aside from the Olympic efforts. Eighty-five percent of those surveyed thought the USG Olympic sponsorship was a positive step.
The impact of activations at live events is also being considered. For example, salespeople were given kits they could use to host Olympic viewing parties with customers. The website was also relaunched, creating a digital experience that would better highlight the tools and services available for end users.
New campaigns are also being launched across the various lines of business. “In the past, we only took one product to market at a time—now we’re looking at things more holistically and talking about portfolios of products that payoff the brand,” McGovern says, noting that packaging has been redesigned and SalesForce.com put in place to help connect better with customers.
USG has also launched its first corporate advertising time to better position the brand in the market. “When we started the rebranding process, we thought that we couldn’t find a common thread across our audiences,” she says. “We had to think about whether we wanted to elevate USG as a brand, or whether we leveraged our sheet rock, or ceiling or tile and flooring brands.”
What USG learned was that the common thread between architects, distributors and everyone in between was that they all had a sense of pride and craftsmanship in their role in the building process. “That resonated with everybody.”
This was the idea behind the new logo, featuring two building blocks and the tagline “It’s Your World. Build It.” USG worked with creative agency gyro Chicago to create the new logo and support the ad campaigns working on the launch. A number of agencies ultimately worked on the relaunch.
“They all did a great job of checking their egos at the door,” says McGovern. “Everyone was so excited, it was a true team environment—we had so few folks ‘under the tent’ internally so we had to rely on the external folks to get things done.”
The next step will to be to launch new campaigns for various lines of business, and USG will work with Gyro to map the customer journey and develop more tools to connect. “We need to think about how we are engaging under the new brand, and how we connect better with the customer,” she says.
The company will continue to leverage the Olympic sponsorship as well, looking for stories that leverage internal connections to the games, like employees who night have children competing on Olympic teams. The company might sponsor their trip to a training facility or a competition.