Archive for February, 2011

Book Review: “Linchpin” Our Needed Wake-up Call

Wednesday, February 23rd, 2011

Way back in December 2009, Seth Godin offered his blog readers a chance to get an advance copy of his new book, Linchpin. The first 3,000 folks who were willing to donate at least $30 to one of his favorite causes, the Acumen Fund, received a book. I jumped at the chance to do so, both because I enjoy Seth’s books and I wanted to participate in this novel form of meaningful book marketing.

Godin’s plan was to get a flood of positive reviews and word of mouth in time for Linchpin to hit bookstore shelves. He even followed up a few weeks later by sending an additional book to people who accepted the original offer. I’m a little more than a year late to the party with my own blog review of the book, but I would be doing my readers a disservice by ignoring the positive impact of reading Linchpin—and I hope Seth benefits from new long-tail sales.

Simply put, Linchpin is a motivational tool for businesspeople who are seeking a new path and need a loving kick in the pants. For years Seth Godin has given us books to help us think about marketing and business positioning in a different, evolved way. But this time he sets his sights on providing individuals with the mentality they need to become “linchpins” in whatever they do. Here are a few of the key points that I underlined in my copy of the book:

  • The “factory contract” of the economy is going away; we can no longer expect to plug into a job, follow the rules, and be taken care of. The future will belong to artists who create something original, interesting, and meaningful. “…History is now being written by the artists while the factory workers struggle. The future belongs to chefs, not to cooks or bottle washers.” “Art” can mean whatever you uniquely bring to the world—a skill, knowledge, experience. It can come to life in a painting, a business idea, or a blog like this one.
  • Education is ripe for an overhaul. “The launch of universal (public and free) education was a profound change in the way our society works…. We trained millions of factory workers.” We need to transform education to teach children two things: (1) Solve interesting problems; and (2) Lead.
  • We must think differently in how we look at success in the workplace or hunt for jobs. “The problem with meeting expectations is that it’s not remarkable…. A resume gives the employer everything she needs to reject you…. Having a resume begs for you to go into that big machine that looks for relevant keywords, and begs for you to get a job as a cog in a giant machine.” It is your visible results that matter in today’s economy: “Projects are the new resumes.”
  • “Real artists ship.” (‘Nuff said.)
  • We must continually learn about the world and ourselves, and have strong opinions but be ready to shift them. “It’s not an accident that successful people read more books.“
  • “One of the fascinating aspects of business and organized movements is that there’s some correlation between the passion and effort that people bring to a project and the outcome…. In great organizations, there’s a sense of mission.”
  • A new model for success is to create valuable art and share it broadly (especially thanks to the power of the Net), and if helps others they will repay you in many ways.

Even if everything here seems that it has been said somewhere before, it’s worth the time to read Linchpin. I know you will find something that inspires you, gets you out of bed in the morning, or refocuses your best efforts. I personally was most moved by Godin’s ability to distill the work I have done around the concept of Marketing with Meaning for nearly three years. It is my passion to help others succeed, and by giving  knowledge and assistance away as much as possible, I have benefited from seeing our company enjoy better business results—but I also get the pleasure of hearing how a blog post, book chapter, keynote speech, or email with advice has helped others.

Sometimes it is difficult to trust that “giving the gift of your art” will allow you to continue to grow your business and yourself. I thank Seth Godin for giving us the manifesto we need to keep creating a new and better future of work.

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Posted in Organizational Behavior, book, purpose | 1 Comment »

Big Announcement: “Possible Worldwide” Our New Interactions Agency

Wednesday, February 16th, 2011

Many months ago one of my daughters told me that she learned in school that sharks must keep swimming to stay alive. I cannot think of any better analogy to the advertising agency industry. In a world of constant competitive pressure, demanding consumers, and brands that see CMO turnover every two years, success depends on making proactive improvements and leading your clients to what’s next. That has been one of the keys to success at Bridge Worldwide, a digital agency where I lead the strategy practice, and it is why I am thrilled to announce that we are merging our company with three other leading agencies (Schematic, Quasar, and BLUE) to create a new, global business: Possible Worldwide. And I am excited to be taking on the role of Chief Strategy Officer in this new venture. Here’s an official Wall Street Journal story of the breaking news.

Our Story

Some reporters have already leaped to the conclusion that this was “just another roll-up by an agency holding company,” but this is very far from the truth. In reality, this merger was completely our idea.

The story behind Possible began back in fall 2009. My fellow execs and I were going through our annual planning process and we recognized a growing need to create scale in geography and services in order to serve the evolving needs of our clients. We decided to reach out to a few other digital agencies within our holding company, WPP. Although sometimes competitors for new business, we all joined WPP around the same time and periodically compared notes as we built our businesses over the past five years. Eventually we broached the topic of doing something together, and decided to meet in person but away from our offices. We went to Cancun, Mexico, to test the waters of working together—figuring that if it worked for climate-change treaties, it could work for us.

Our purpose in meeting in Cancun was not only to see if our businesses would match up together, but, more importantly, to get a feel for how we could get along personally—so we shared our personal hopes and dreams, our visions for changing the advertising industry, and the cultural glue that holds our offices together. We made enough progress in that first meeting that we got together again in London, then New Delhi, and followed by Singapore and New York City.

With each meeting—about every two to three months—we made more progress on building a model for a new network while elevating office leaders to take our places. Not every agency we spoke with chose to continue the journey, but some acquisition targets have specifically said they wanted to throw in with our group. Through it all, our parent company, represented by Mark Read (WPP Strategy Director and CEO of WPP Digital) encouraged and aided our progress along the way—yet continually gave us the freedom to make our own key business decisions.

And so after many months of planning, we are putting a new team together. It is a team of entrepreneurs who have all built successful digital agencies independently, and who have chosen to come together to create something bigger and make an even more positive impact on marketing and society.

Possible Worldwide: An Interactions Agency

As you might imagine, it has not been completely frictionless for a dozen or so entrepreneurial leaders to come together and agree on the future of an agency. The naming process was a pain, as always, and many late night and early morning conference calls were organized to sort out the innumerable details. But perhaps the simplest choice was our new, combined brand positioning. Early on in our merger discussions we felt energy around the idea of creating “interactions” as the focus of our work and what we believe lies at the heart of the future of marketing.

We struggled with categorization of company as a “digital agency” for two reasons. First, digital is becoming “everything” in marketing and media and more or less table stakes in the future of business. Second, it does nothing to describe the specific skills or beliefs that we have. On the other hand, “advertising agency” is limiting in that it mainly conjures up a world of interruptive messages. We wished to classify ourselves as something beyond these mental shortcuts to something more, an interactions agency, and I couldn’t describe it better than with the words our team came up with:

“Possible is an interactions agency. That means we help our clients create experiences that deliver something of real value to their customers, whether that be utility, entertainment or community. These interactions, or platforms, are driven by big ideas and customer insight, and have a lasting life beyond a single campaign. Advertising serves as a function, too: Not just to broadcast a message, but to invite consumers into a larger, longitudinal brand experience that consumers can engage with.”

The facts and figures behind our new company still give me goose bumps: 1,000 people, 18 offices, and a client list that includes several of the biggest marketers in the world: AT&T, Barclays, BBC, Comcast, Dell, Dow Corning, General Mills, Luxottica, Mazda, Microsoft, Nokia, Orange, P&G, Samsung, SAP, Southern California Edison, and Starwood.

You might be wondering what this means for Marketing with Meaning? Am I going to shut down this blog and Twitter feed? Hell no! In fact, the formation of Possible creates an even bigger, global platform for the movement that we launched here nearly three years ago. In our company description we affirm that Possible Worldwide “is a global agency that creates meaningful and measurable interactive marketing.” We’ll be taking this movement to more countries and more clients than we ever could have on our own.

As regular readers know, my personal mission is to make a dent in the universe by helping to lead a shift in marketing from interruption to meaning—with the aim of improving business results, doing more for people, and creating jobs that we love to come to in the morning. With this new agency and new role, I feel that achieving this mission is even more Possible.

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Posted in Agency Marketing | 4 Comments »

The Strategic Lessons in Groupon’s Super Bowl Fumble

Thursday, February 10th, 2011

Groupon should have had one of the best Super Bowl ads during the big game last weekend. After all, the company checked off nearly all of the steps that many other advertisers have used in the past: widely known celebrities (Cuba Gooding and Timothy Hutton), a big-name director (Christopher Guest), an award-winning creative agency (Crispin Porter + Bogusky), a budget that allowed for multiple ads, and a humorous commercial concept. Unfortunately, while many other companies have taken these steps, many similarly failed to score in the Super Bowl—and there are a lot of former CMOs, sock puppets, and dead dot-com companies to prove it.

Groupon’s approach to the Super Bowl has not fared well according to however you might measure its results. For starters, one commercial stirred a controversy by poking fun of people’s support for the oppressed people of Tibet. Not only was this in poor taste to most Super Bowl viewers, but extremely risky to tweak a sensitive issue for China, where Groupon has prioritized opening up shop next.  Consumers in the USA TODAY survey ranked it near the bottom of its annual likability ranking. Nielsen pegged it outside the 10 most-recalled spots. And it didn’t make an impact in Twitter tracking.

So in what should have been its big coming-out party, Groupon made a poor first impression. The cost? Huge. The media expense of three, 30-second spots before and during the game likely ran around $7.5 million. Plus there’s the expense of producing the spots. I know from personal experience that this quality of filming, actors, and direction for three completely different commercials is probably on the order of $2.5 million in total. So that’s about $10 million in cash for a questionable return. Not to mention the fact that the company might have hurt its brand by creating controversy and looking bad in front of more than 100 million potential customers. As a famous commercial once said: You only get one chance to make a first impression.

How could things go so wrong for a company that seems to have everything going for it? Like many things in business, it comes down to the strategic choices that are made along the way. The purpose of this blog post is to shine a bright light on the lessons Groupon hopefully learned the hard way in hopes that you don’t fail as spectacularly in launching your own new product.

Lesson 1: Advertising Must Communicate the Concept of a New Product or Service

In terms of its overall company strategy, I believe Groupon has been wise to shift toward driving Awareness. Due to rising competition and a business model that is fairly simple to replicate, the company is in a race to win mind share. But when it is time to build awareness of your new product or service, the advertising must hit on the fundamentals of Concept or Copy Strategy. It must teach people what it is, how it works, and why it is right for them. And it must do so in a clear, direct way.

Groupon fell for the old advertising dogma that TV commercials—especially for the Super Bowl—must be entertaining to “break through.” You can hear this in the comments of Groupon’s CEO, Andrew Mason, as he explained his company’s commercial choices:

“Our ads highlight the often trivial nature of stuff on Groupon when juxtaposed against bigger world issues, making fun of Groupon. Why make fun of ourselves? Because it’s different—ads are traditionally about shameless self-promotion, and we’ve always strived to have a more honest and respectful conversation with our customers.”

Mason does not believe that people want to hear what Groupon is, calling it “self-promotion,” and instead agreed to make fun of his company in its very first ad! In this quote he is directly calling some of his small-business customers “trivial.” And more specifically, the idea of eating at a Tibetan restaurant itself makes the service seem like a goofy, niche idea—after all, how many people in the U.S. have such cuisine within driving distance? Is this a Groupon commercial or a Saturday Night Live spoof?  UPDATE: Mason decided to take down the ads by the end of the week.

I know it might sound crazy coming from an author who promotes Marketing with Meaning in this space, but with new products and services, consumers often find the advertising interesting. That’s right. People are really interested in what’s new, and will reward advertising that teaches them what it is, how it works, and why it is right for them.

It might surprise you that infomercials are some of the least-skipped commercials in TiVo’s regular testing. I know from my own experience in launching new products such as Mr. Clean Magic Eraser that the highest-scoring commercials present the basic product concept in a clear, direct way. Or take the example of Hyundai’s Super Bowl ad in January 2009, which simply and directly described its Assurance Program. While it was dead last in the USA TODAY poll, the ad clearly described a new benefit, and the program grew sales 6% while the industry was down 19%.

Groupon could have done so much more by taking this educational route instead of relying on entertainment. For example, because the service is focused on local deals, it might have been smarter to, say, purchase local market TV time during the game and create a commercial that could be edited to show the actual, great recent deals on products and services in these markets. That’s the kind of ad that people would find relevant, informative, and compelling. Plus, you save some money on the celebrity actors and director.

(Note: My problem with most TV commercials is that they don’t contain useful information about new products, services, and benefits that people care to see. They push product improvements that have little novelty/relevance or attempt to entertain when we already are watching something entertaining.)

Lesson 2: The Super Bowl Can’t Be Your First Game

None of the football players in the big game was putting on pads for the first time. It takes years of two-a-day practices, film room time, and firsthand lessons learned from both victory and defeat. The same goes for all of the marketing executives who suit up to bring commercials to market. This is not the time nor place to first strap on a helmet.

I do not mean to question the usefulness of the Groupon service here, and I have to give the management team and its investors a ton of credit for building what has been called the fastest-growing company in history. However, this team has never been in the big advertising game before—and it showed. CEO Andrew Mason has never had a mass marketing role. There is no CMO on the company’s roster of top management or investors. Its Director of Marketing comes from a loyalty marketing background. I think these people could make a very successful company tapping into their existing skill sets, but when you jump into the Super Bowl of Advertising, you’ve got to have an expert in your corner.

I am sure that the choice to go with Crispin Porter as its advertising agency was made to overcome this lack of experience. Crispin is known for some of the most creative, award-winning advertising in the world. It has done great Super Bowl ads in the past. But there is a fundamental flaw when there is no one on the client side with experience in managing the agency. This is the play we saw again and again during the dot-bomb years: company gets crazy amounts of investor funding, is pressured to gain awareness fast, and hires a fancy ad agency—which does what it wants with little “adult supervision.”

At best, an outside agency just doesn’t have the same skin in the game as a company and its management, so it doesn’t think about the risks and issues that might arise. At worst, an agency just sees this job as an opportunity to soak its dot-com client for millions, make friends with celebrities, and win a few awards. Sorry, folks, that’s reality—and I learned this lesson myself the hard way early in my career at P&G. Being on the agency side now, I see how an experienced client partner can make sure we do our best business-building work.

One misfire does not mean the end for Groupon, however. If anything, this Super Bowl fiasco is a costly but important lesson for Groupon and its investors: It’s a big brand now, and needs to bring in more seasoned executives to help ensure that its early promise converts into long-term success. I believe that by looking into the strategic misses of the company, you, too, can take away lessons that might save you the pain of similar moves in the years ahead.

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Posted in Marketing Without Meaning | No Comments »

Big Companies’ Rising Demand for Digital Leadership

Wednesday, February 9th, 2011

If you work in the digital marketing world like me, you might have noticed a gradual increase in the number of recruiters calling with a wish to fill some pretty big roles in Fortune 500 companies. Just last week my friend Pete Blackshaw was hired as Global Digital Officer for Nestle. I won’t list other searches I’ve heard about here for obvious reasons, but let’s just say that some of the largest, most respected brands in the world are looking for senior digital talent. Roles like Senior VP of Digital Marketing and Chief Digital Officer are opening up. These companies are looking to hire candidates with skills that you might expect—things like several years of experience with both traditional and digital marketing. But there is a bigger theme running through this rising need. Companies are looking for digital experts who can confidently lead them through change. Digital experience, titles, knowledge, and awards do not equal leadership, but if you have the latter, the doors could open quickly.

It should serve as no surprise that major marketing-driven corporations are elevating digital leadership roles. Their consumers are increasingly going to digital media first, and the line between offline and online has become sufficiently blurred. In some cases, Chief Marketing Officers are looking for a right-hand digital native who can help them learn the new rules of the lead marketer role. And a little more than 15 years since the first websites and banners went up, there is now a pool of candidates with seniority and experience.

Despite the high demand for such roles and what should be an ample supply by now, recruiters tell me that many potential candidates lack the ability to provide the needed level of organizational leadership. I hear this in comments like, “We need someone who is confident in front of the CEO,” and, “Digital people seem less willing to bring forward recommendations and more frequently just wait to receive guidance.”

After spending my past 15 years working on both the client side at Procter & Gamble and now on the agency side, I generally believe that there are both perceived and real issues around the leadership skills of digital experts at large companies. Perception-wise, there is usually a bias to give more weight to the opinions of those who “own the P&L.” Experts in every area—from PR to Design to Product Supply—rarely have direct business decision-making responsibility, so senior leadership can have a tendency to discount what they say.

But I believe this lack of P&L ownership leads to a very real issue: Digital experts can come to believe that they are not really key business influencers, and end up waiting for an assignment or request for input rather than driving the dialogue, project list, and budget requests. One friend of mine in a senior digital position recently told me that, “I am waiting for one of my people to come into my office with a recommendation on what our brand should do next.” Instead of “managing up” and leading the thinking on what the team should be doing—say, what new technology is ripe for attention—his team was waiting for assignments to trickle down.

The good news is that a leadership mentality is something that you can take on at any time in your career. You certainly do not have to come from the client side or have owned a P&L at some point. Sometimes you just need to reset your thinking and choose to drive your work plan rather than waiting for it.

I have generally seen digital experts succeed in leading when they are given more specific ownership of projects or pieces of the business (for example, “owning” the brand website, a CRM program, or an e-commerce initiative). In these cases individuals tend to feel that they are expected to drive overall business success, rather than simply delivering on a project plan. The best digital leaders take on this mentality at a corporate-wide scale. They convince themselves (and others) that the entire company is depending on them to figure out how to win in digital marketing, and they propose and fight for the strategies, budgets, and work plans needed to win.

Thinking bigger picture—I expect that in the future we will see the “digital expert” role go away and instead brand leaders have digital knowledge and experience baked in. This goes hand-in-hand with all of the talk that traditional and digital advertising agencies will merge into one. So if you’re in a digitally focused role today, this is your opportunity, your mandate, to lead your organization into a new land. You just might become the CMO of the future.

Posted in Organizational Behavior | No Comments »

Working vs. Nonworking in Digital Marketing

Wednesday, February 2nd, 2011

As I tell people frequently, the driving purpose of the work I do each day is to help brand marketers make the move to the next evolution of marketing. Therefore, one of the core challenges that keeps me up at night (and gets me out of the bed in the morning) is the need to provide marketers with tools and perspective that can help them make what can feel like an enormous change in habit. After years of thinking about marketing in one way, it is incredibly difficult to break principles that have guided us to success for decades. Today I wish to show how new media demands new principles and to blow up the old habit of using strict formulas to dictate the amount of money clients spend on media versus production—or Working versus Nonworking dollars.

As many readers know, in budgeting, brand marketers set aside funds for two broad categories of spending: (1) “Working Dollars”—the price to purchase impressions for an advertisement on a media channel; and (2) “Nonworking Dollars”—funds that are used to create the advertisement itself (e.g., production, editing, agency fees) and measure results before or in market.

Marketers typically wish to minimize total spending on Nonworking dollars (itself a denigrating term), as these costs are mainly perceived as a drag on ROI. After decades of work in traditional media such as TV and Print, many marketers have established guidelines for the appropriate budget percentage allotted to these Nonworking costs—usually 10% to 15% of total costs.

Unfortunately, we increasingly see brand marketers pass up opportunities to grow their businesses and change the marketing game for the better through new forms of media. By following old heuristics, many are giving up opportunities to optimize Search and Display, and are under-investing in Mobile, Social, and Websites, which can generate superior, Earned media engagement. Here’s what I believe is breaking down these historic principles:

1. New digital media is altering the formula that brands historically have applied to guide spending.

According to research by Exane BNP Paribas (adapted into the chart above), traditional media is holding at around 12% of total spending, yet newer media forms push that number up significantly. Search and Display (e.g., banners) rise to 15% to 20%, and recent efforts in Mobile and Social shift up to 55% to 60%. Search and Display have been used by brands for more than a decade each, leading to efficiency gains and a gradual decline in Nonworking percentage. However, these new media will stay higher than traditional media because they typically include in-market measurement and refinement. Brands should adjust their expectations and budgets accordingly for Search and Display.

2. Mobile and Social are even higher in Nonworking percentages because they represent the rise of Earned media that breaks from the traditional, Paid media model.

Generally, brands’ efforts in Mobile and Social do not simply turn over to paid media placement, thus breaking the age-old formulas that have been applied. Brands active in Mobile have focused on producing mobile-friendly Web pages and useful or entertaining apps. And in Social, marketers are building platforms to connect directly with consumers (e.g., active Facebook pages). None of these activities is transitioned into a typical media buy, so under the guidelines of historic habits they are labeled as Nonworking. I have seen brands decline to spend the tiny amount of money necessary to update their Facebook pages because of this self-imposed rule.

3. Although Nonworking costs may rise, Earned media offers a greater ROI than traditional, Paid/Working media.

Our research with several major brands/categories proves that Earned media engagements beat Paid media interruptions in nearly every measure. For example, Paid media does not account for the vast majority of impressions that are not noticed by consumers, while Earned media only counts those who lean forward and give attention to the marketing. Paid media must be repurchased continually, while Earned media can generate repeat visits and CRM activity. Further, the fragmentation of media consumption means that CPMs on Paid media are rising, and brands must produce more ad units across more media channels—thus lifting the Nonworking percentage even for traditional media.

4. New media offers the opportunity for scaled, Earned, and Owned media for brands that invest in creating content.

Brands that break the Working versus Nonworking mind-set and create valuable content platforms are reaping new levels of success. Examples include the Kraft 15 million person email database and successful iPhone app, Old Spice’s Twitter/YouTube videos generated 35 million views in seven days, General Mills’ Box Tops for Education with 30 million engagements per year, and Coke Rewards with more than 10 million members. And a recent Syncapse study suggests that a Facebook “Like” is worth $136 for the average brand thanks to low-cost, earned impressions, engagement, and word of mouth.

Conclusion

Chances are high that your brand or your clients have had at least a few discussions about how the next evolution of marketing is testing these tried-and-true formulas. My hope is that you have hard conversations about this change and make the adaptations that are required, rather than resting on old models that might help you sleep at night but won’t move your business forward.

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Posted in Organizational Behavior | 3 Comments »