Open hands marketing?

At the end of 2009 I suggested terror, technology, celebrity and debt as a 4 word summary of the preceding decade.

What's the word for 2010? Strong candidates would be disclosure or openness.

The Wikileaks cables are one example of the power of technology to change how information works - and crucially to give us all access to more of it.

Another is the ongoing evolution of social media. I've been to a couple of gigs recently (trying, in vain, to regain my youth), and been amused by quite how many people are taking photos - many of which are promptly uploaded to Facebook or Flickr. Go online and it is very easy to find popular reviews and feedback from events that took place just hours ago, as well as stuff in anticipation of events that are coming up. Event promoters - like politicians - are no longer in control of the flow of information.

This kind of disclosure isn't going to go away. If the US government cannot shut down whistleblowers, then brands certainly can't. Courageous brands are already adopting openness as a virtue. I think the next couple of years will enforce it on us all. (And, in the end, good thing too.)

#hashalongTV

While watching Have I Got News For You last week, I noticed that the BBC has decided to display a hashtag (#bbcHIGNFY) as the show opens. Shortly after, I spotted Question Time sporting one too (#bbcqt). I was intrigued - do the twitterati really watch Question Time? And if so, what do they say about it? So I flicked open the Twitter App on my phone. As it happened, a particularly unctuous hedge fund manager called Hugh Hendry was on the show's panel, and a lot of the #bbcqt tweeting was directed at him:

callummccrae1: Hugh Hendry is a wanker that is all. #bbcqt
markjepson: On a serious note, Hugh Hendry is an obnoxious cretin. #bbcqt

The twitterers had a point, but that's by the by. What struck me was how this totally changes the viewing experience. A passive 'slumped in front of...' moment becomes an active social one. Suddenly we're all sharing a vast virtual sofa, muttering our asides to each other.

For the time being it's rather cumbersome - and not everyone has a smartphone anyway. But one or two iterations and this stuff will be scrolling right across the screen - if we want it to. Some classifications of TV are more ripe for commentating than others - sport, soaps and reality shows are obvious contenders. And while we probably don't want to hear the whole world's commentary on our favourite movie, we may welcome contributions from our friends, so the Facebook hybrid of this will be interesting. A thousand strangers can add nothing to my enjoyment of Withnail & I, but if a friend writes "#withnail @alex - you perfumed ponce" on my wall? ... ROFLMAO

Ad breaks, let's face it, have always been fair game, so we need to work out how brands should react when ads are dissected live ("that stuff's crap"). And what about exploiting the new forum by integrating hashtags inside the campaign through an interactive creative idea? Carlton Draught in Australia has added a hashtag under the brand logo at the end of the ad, to some effect. But what about incorporating the hashtag, or some tweets, into the concept of the ad itself? You don't have to know what one of these campaigns looks like to know they exist. Write the brief.

Of course, in-programme (and indeed in-match) tweeting isn't new. What's new is merely that I have caught on. But if I've got it, then the rest of the population can't be far behind.

Wake up and smell the own label coffee

The Economist this week has an article on the impact of the economic crisis on consumer goods purchases. It quotes PwC and McKinsey evidence that consumers have significantly changed their behaviour - such as by buying own-label products, by buying less, or conversely by buying bulk, or even by deciding that some things aren't as essential as they used to seem. (Air freshener, anyone?) Well, you heard it here first - six months ago, but the data goes to reinforce the point.

93% of shoppers say they have changed their behaviour as a result of the economic downturn. (PwC)
18% of packaged-goods buyers switched from a premium brand to a cheaper one during the recession, with most saying they found that the pricier brand “was not worth the money”. (McKinsey)

Even more alarming are some of the comments by the Economist's readers:

TomNightingale wrote: Oct 14th 2010 12:18 GMT
The price differences between branded goods and own brand are mainly spent on advertising, Advertising does not create value, it consumes valuable resources and returns little, if anything. The value of a brand is largely its ability to persuade people to pay a higher price than they need to to buy a product, Advertising and brands allow parasites to take good livings at the expense of others. If the recent/current economic woes leave advertisers and "branding experts" in difficulties we should all rejoice. We don't need them; they make us all worse off.

pasam wrote: Oct 14th 2010 12:47 GMT
If the recession leads to a "Needs based Society" than the present (or past?) "Advertisement Induced Society", then that is a "silver lining". Let the "shine" of parasitic advertisement be ignored and let the chemistry of needs take over.

It's not as though we haven't heard these anti-brand views before, and they aren't very well informed - they take no account of the role of brands in delivering innovation, consistency, reassurance, confidence or convenience, for example. (But then I would say that, I'm a parasitic "branding expert".) However, they do have a compelling basic thrust: products which only sustain their premium through advertising are in a precarious position.

The conclusion we must draw from recent consumer research (both quali and quanti - pretty consistent on this matter for months now) is that long term success means delivering a premium-justifying benefit. It can still be emotional - reward, status and so on - rather than rational - taste, quality, features - but it must exist. Large swathes of supermarket aisles are still filled with brands that don't truly offer a benefit. What's worse, I fear some brand managers haven't realised that the rules are changing, or have deluded themselves that their own brand has a "real" distinctiveness when all it actually has is residual market share supported by media share of voice and retail share of shelf. Wake up!

High definition optics

The Chile mine rescue was a perfectly formed moment of global media. Respect due to Oakley for spotting the opportunity for a bit of product placement. As Oakley's press release explained it:

The rescue team in Chile is relying on Oakley eyewear to protect the miners’ eyes when they are brought back to the surface... Based on their requirements and full product specifications, Oakley donated 35 pairs of Oakley Radar® with Black Iridium® lenses in Path™ and Range® lens shapes

A good deed... and with it the certainty of appearing on every TV set in the world (33 times!), as well as a chance to convey their scientific credentials. I was in New York this week, and witnessed coverage of Oakley in both the US and UK - and no doubt there was coverage elsewhere round the world too.

Crucially, the mine rescue was perfect PR fodder: compelling, but with no hint of exploitation. Oakley don't seem to have invited any backlash by getting involved. In a poll on The Huffington Post, 90% of respondents thought it was a good thing for Oakley to have done. Smart stuff. I want some.

All change please

Plan Phoenix had a little r’n’r over the summer, while I’ve been too engrossed in projects to look up long enough to reflect. Ah well. A moment of calm descends.

Every time recently when I talk to others in the marketing services industry, I’m struck by how much has changed in the last 2 years. Tighter budgets have made budget holders think deeply about what constitutes effectiveness (hallelujah!). And I see a lot of evidence of changing priorities. We shouldn’t be fooled by profit growth at WPP into thinking that “traditional” advertising is on the way back. I suspect the headline disguises a number of factors. For a start, the services delivered by the big agencies are changing, and anyway, the growth of consumer markets in Asia means there will be room for the traditional advertising industry to grow in size even as it declines in importance. (Presumably the global market in desktop computers will continue to grow for ages. Yet the future is mobile. This isn’t a contradiction, just a reflection of an expanding universe of consumers.)

Its 8 years since Al Ries published The fall of advertising and the rise of PR. It’s still a good read – though it was never compelling. One problem is that we use “advertising” to mean both creative content and interruption based executions (the TVC, for example). And while TVCs are palpably in retreat, we’ll continue to need more, and better, creative ideas. Another problem has proved to be that PR doesn’t seem to provide the structure or discipline to actually drive marketing plans. Inviting the PR agency to the top table is one thing, asking them to lead the whole programme is quite another. But anyway, I wouldn't be the first to announce the “death of advertising”. Google that and you’ll find articles dating back decades!

Of all the changes in play, two stand out to me:

1) Experience.
In a multi-channel, fragmented world, where the cacophony of offers gets ever louder, passive communications no longer cut through. The TVC is dead if it isn’t part of something richer, touchable, immersible. Ideally, that richer experience has some relevance to the brand – I’m no fan at all of sponsorships which simply plaster brand logos on things. Barclays Premiership is just a form of – probably overpriced – media buying. But at the same time, the experience won’t get far off the ground if it’s only about the product. The advertising campaign for Pantene, encouraging women to share your swish makes me laugh. But not for the right reasons. The better path is to find or create a property which bridges both the brand’s distinctive experience and the consumer’s existing interests. If you build your activity (advertising included) round that, you’re on the right track.
We used to argue about whether to brief creative first, then channel planning or the other way round. Answer? Media before creative (of course). But crucially, it was the wrong question. The real answer? Experience before media before creative. I shared a platform at a conference a while back with one of the marketing team at O2. I continue to admire their use of music as a platform. It’s a great way to reach consumers through something they care about. And they are able to create content – from downloads to ticket purchasing and VIP exclusives – tightly integrating the activity back to their product. There’s no earthly reason that I can see why most brands – even at the commoditised end of fmcg (yes, even shampoo) – can’t build relationships this rich with consumers. We just need to start from the right place in order to find the right connection.

2) Interaction.
The second thought builds on the first (because it’s difficult to interact without an experience). But this is a major adjustment in mindset for those of us trained in command and control marketing. We can no longer (could we ever?) dictate how brands are portrayed – just look at any social media website. I’ve worked with brands grappling to overcome negative associations, and it’s not easy. The answer, I think, is to relax a little. Brands exist in consumers minds. We may direct, manage and guide them but we cannot control them (the consumers that is, or the brands). We can continue to fight reality – encapsulating our message in a single-minded one-way campaign which we then inflict mercilessly on consumers, bringing in the lawyers when things get out of control (remember the MasterCard “Priceless” send-ups?). Or we can change our way of thinking – creating content with the intent that the audience manipulate it, and being prepared to go on a journey with them. It requires bravery because it involves real-time judgements and because it’s difficult to “sign off the brand plan” when you don’t know where it’s going. But I’m certain brands that embrace this philosophy own the future.

Well, that's the basis on which I'm planning my business. And you?

#iagreewith[insertyourbrandhere]

Cleggmania shows up a couple of interesting things about the political party brands.

Firstly, it shows how brittle brand reputations can be. Despite all the obvious product performance problems the major parties have experienced in the last few years (from unpopular wars to unpopular expenses claims), they - and the pollsters - didn't see this coming. The polls over the last year or two have been misleading, showing relative share without identifying how fragile (maybe even broken) the relationship between voter and party has become. Have the polls really moved so suddenly, or have people begun to engage with the question differently? Its pretty obvious - even with only a week's hindsight - that the signs were there, but they weren't understood by strategists or commentators.

Secondly, the fevered buzz on websites shows just how far the relationship between people and media has changed, with the media now playing catch-up with popular opinion rather than leading it. Preference has spread like wildfire, fuelled by Facebook, Twitter, blogs and comments. It is the peer-peer response to what has happened that is most interesting, and that is driving events. Ironically, a digital era phenomenon has been triggered by a TV event.

Of course its entirely possible that in a few days this will all have blown over and the political parties will be doing their best to forget it as a bad dream. But it raises interesting questions:

1) What's the relative importance of tracking brand preference versus identifying emerging trends and deeper motivations? Are we sure we're not driving with our eyes fixed on the rear-view mirror?

2) In a much more volatile media environment, is there any longer a role for "incremental" marketing strategies? Are we building plans that might catch fire (+10%), or still trying to "play safe" (+3%)?

The end of the world is nigh, and other news

My mother probably gets frustrated that when she asks me any question along the lines of “where would I find...” I roll my eyes and reply “Google it” or “look on eBay”. My mum is no slouch – and no technophobe, but it takes time to learn new habits. I noticed myself doing something strange last week. I went online to buy a light bulb. It was an unusual type and I’m fed up of trailing round B&Q/ Asda failing to find the right ones and then coming home with the wrong thing. But even so, it was a very small purchase – online has historically been perceived to be cost effective only for bigger spends.

In fact, I looked back at my online shopping over the last year and was amazed by the number of transactions of less than a fiver. Crucially, the cost of delivery has ceased to be a limiting factor – presumably because it’s less than the cost of running a physical store. I don’t think I’m alone. MasterCard’s February SpendingPulse report claims that overall online spend rose 16.7% in the last year, while average transaction value online dropped 3.7%. They attribute this to a fundamental change in habits. (It’s US data, but the UK won’t be far behind).

Once every household is online (something governments across Europe promise to facilitate even for the disadvantaged), and we’ve all learned a few new habits, what will we do with all that empty high street? Apart from clothes shops, and impulse shops will we need actual bricks and mortar retail? How many consumer goods brands are really confident they can win new shoppers solely online? Brands like Apple and Nike have had flagship stores for years – masquerading as retail but really offering a good dose of brand experience. But a lot of categories will have to work very hard to create a true brand experience (what would actually happen in Ariel-Town?)

Worrying news for many, made worse by evidence emerging that the downturn has resulted in apparently permanent changes in consumers’ attitudes to ‘value’ – i.e. the importance of price. We are more willing to shop around for a bargain (as noted by the Wall Street Journal) and we place less faith in the quality promise of brands. Marketing Magazine reports a study showing 67% of people think store label products are as good as branded ones, with the same number saying they had switched to store label brands to save money, and 64% saying they wouldn’t switch back even if the economy picks up. It was always inevitable that the economic upheaval of 2009 would change the rules forever – I think we are just beginning to see the signs of what that means.

Flaky, flakier, flakiest

So Cadbury is no more. As the grandson of a black country confectionery wholesaler I can recite the names of great British chocolate companies - Fry's, Mackintosh, Rowntree, Trebor, Terry's... - all now subsumed by Kraft and Nestle. Much wailing and gnashing of teeth.

But what irked me was not Kraft's takeover bid (perfectly reasonable - business is business) but rather the plaintive argument by Cadbury's leadership that their business was worth so much more. One has to wonder about the investor relationship strategy of a company claiming to have such great prospects but unable to persuade UK insurance companies to continue to hold stakes.

Todd Stitzer argued that Kraft's leadership were not of sufficient quality to deliver on Cadbury's potential. Now we will see. The test of Cadbury's own leadership came earlier - and their share price (before the advance by Kraft) put an absolute measure on their failure to leverage their brand with one of its most important audiences. Cadbury did a lot to revitalise its consumer brand over the last few years, but evidently not enough to revitalise its investor brand. Eleventh hour protestations were much too little, much too late.

People presume that marketing is all about consumers. This should serve as a wake up call. Perceived value applies to every audience. Kraft, it transpires, is the only investor who really perceives value in Cadbury. On that basis it is a worthy winner.