SLOW Movement

Coca Cola "Heist" Superbowl Commercial

Apt illustration of team work. Enjoy!

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Economist: Social networking - Rules of Engagement

Social networking

Rules of engagement

May 25th 2011, 11:34 by G.F. | SEATTLE

A FRIEND has been toying with Twitter, and wonders how best to get her feet wet. Whom should she follow? What should she read? Here are some thoughts.

Viewed as a loudspeaker for others—celebrities, creative types, or just acquaintances, pronouncing on what are all too often fatuous banalities—Twitter does indeed resemble the empty medium derided by those outside its embrace; like sitting around an abandoned and empty pool in a solitary chaise longue, with TVs blaring nearby—an experience that is neither convivial nor informative.

Sticking to the bathing analogy, an alternative (though by no means the only one) would be to attend a crowded ocean beach, with swimmers constantly throwing themselves in and out of the water, some more expertly than others. The beach is likely to be lined with reclining observers listening to the water-borne banter, but they are not the ones having the most fun.

Twitter rewards engagement in a way that few other media do (the sea is such a medium, albeit only in a physical sense). The relationship between users is nearly always asymmetrical: following someone does not entail being followed by them. That leads to enormous mismatches: the glitziest twitterati amass hundreds of thousands, even millions of followers, and yet themselves follow just a few dozen people.

Babbage's friend had thrown her lot in some months ago, following a small number of people, and issuing a few tentative tweets. She was not impressed by the response. Her view of Twitter was of an unplugged toaster where the bread neither browns nor pops out.

Suffer as he does from logorrhoea, this Babbage blathers through the day. He also, like his departed mother, knows no shame in striking up conversations with complete strangers—she, in public; he, on Twitter—that he finds interesting. As a child, he complained of her habit. Now, the grudging inheritor of it, he finds easy sociability indispensable in the digital world.

Enter what is perhaps Twitter's greatest, and inadvertent, innovation: the goad in the form of an at-sign (@) followed by a Twitter handle, known as a mention. Twitter did not invent this referral, which was picked up from older chat-system conventions. But the firm adopted it and uses it to create threaded conversations. The mention is distinct from a direct message (DM), which Twitter created intentionally, and which allows a private bit of text to pass between two parties, so long as the recipient follows the sender. The DM is reserved for those who have established a relationship; the mention, meanwhile, works for anyone.

Mentions may easily be ignored—@stephenfry, say, with 2,647,917 followers as this sentence is being written (likely to rise by the time Babbage is done with the post), would be physically incapable of responding to all. To make life a little bit more manageable, most Twitter software, whether from the company itself or innumerable third parties, can be set either to list all mentions in a main chronological stream mixed in with tweets by those the user follows, or only to include the mentions by the latter.

Your correspondent, with 4,000 or so followers, is small fry, as it were, and has the time to engage with nearly everyone who mentions him. ( @EconSciTech, Babbage's official feed, currently nudges 10,000 and engages a little less fully.) He has made many acquaintances, and even some new friends. Over time, he has ditched nearly all those who, whether with ten followers or 10m, never reply to anyone, or reply to just a small coterie. Such tweeters are listening to the sound of their own typing.

Twitter users who are not household names tend to start by following loved ones, colleagues, favourite writers, etc. Replying to those you do not know personally is no faux pas, whether or not they are extremely well known. And if a popular tweeter retweets you—ie, redistributes the tweet to his followers—that can do wonders to your tally.

What should Babbage's friend make of all this? She is a writer, filmmaker and former television presenter, yet Twitter makes her strangely shy. Your correspondent's advice: the only way to go is to take the plunge and start talking, loudly and often. Well, not too often.

Media: Why you can't lie to me

Why You Can't Lie to Me

Douglas Quenqua, Apr 13, 2011 05:24 PM

You've seen the TV show but there's some real science behind facial coding It's true: Advertisers lie. But here's another fact: so do consumers. Anyone who's ever monitored a focus group can tell you that. Maybe it's not lying of the shameless "It was like that when I got here" variety. It's more the "I base my grocery-buying decisions on nutrition, not packaging" kind of fibs. But either way, it's misleading and advertisers pay the price for it. Luckily, faces don't lie. Someone watching an offensive commercial is going to look disgusted, just as the lips of someone watching a poignant ad will quiver as he fights back tears. All the questionnaires in the world can't match what a trained professional (or now, software) can learn from watching someone's face. If only there were a way to harvest the facial expressions of consumers of all demographics from all over the world, then translate them into actionable marketing data. To be clear, there isn't...yet. But there are a handful of companies doing some clever things with facial coding and eye tracking and other whizbang technologies to help advertisers better gauge how their customers really feel about them. Or at least how they feel about their products, packaging, ads, store designs and Web sites. "Darwin realized that the face was the best place in the body where we reflect and communicate our emotions," says Dan Hill, president and founder of Sensory Logic, a market-research firm based in Minneapolis, Minn. "It's the only place in the body where muscles attach right to the skin." Darwin's insight was based on the observation that blind people make the same facial expressions, corresponding to the same emotions, as sighted people, suggesting that facial expressions are not learned but hardwired into our brains. Facial coding may owe a philosophical debt to Darwin. But the technology traces back to a psychologist named Paul Ekman, who in the late 1970s developed what's known as the Facial Access Coding System, or FACS. The system, which has so far been of greater use to animators than advertisers, reduces all facial movements to mathematical units. By measuring the movements of a person's face, one can interpret that person's emotions. Thirty years after the development of FACS, companies like Sensory Logic are helping advertisers apply that technology to market research. The primary way Sensory Logic does this is exposing test subjects to a commercial or a radio ad while a Logitech camera records the subject's face (the process is called "exposure"). Experts then decode the facial expressions and line them up with the content the subject was watching to determine, down to the second, how that person really felt about what he was watching. In the past few years, the company has even begun offering this service remotely. As long as a subject has a camera installed in his home computer, the company can record his facial expressions as he watches the content from home. Other companies are now working on bringing the technology to smartphones. The invention of the Flip camera has also allowed Sensory Logic to combine facial coding with traditional focus groups. Now market researchers can record the faces of focus-group subjects to see when their expressions betray their words. The company can also record the faces of subjects answering questionnaires to look for "any gaps or illumination between what they see and feel," says Hill. To appreciate the value of such tests, consider the example of a pharmaceutical company trying to determine what mattered most to doctors when prescribing medicines. When asked why they choose one drug over another, "of course the first thing the doctors say is efficacy of the drug," says Hill, "but when we looked at the emotional data they hardly emoted about that at all." What did capture the doctors' hearts, according to their faces? "Ease of filing for reimbursement and the payment schedules and so forth," says Hill. In other words, "things that were much more central to their own pocketbook. Those things were much more of interest to the doctors." This kind of research has also helped quantify the shortcomings of traditional focus groups. Most advertisers already know that people in a focus-group setting will sometimes adjust their answers to make themselves look smart, or to cozy up to an alpha dog in the room. But Sensory Logic has taken this further by looking at how people of different ethnicities and demographic backgrounds behave differently. "Hispanics tend to respect authority, which means they might be a little less forthcoming to make a criticism," Hill says. "African-Americans are pretty straightforward. In our research they come closest to just saying how they feel. But whites and Hispanics and Asian-Americans - you're talking about a gap that's double digits between how much they're willing to admit they like something" and how much they really do. In an age when advertisers spend a lot of time and money crafting discrete messages for different ethnic groups, such lapses in insight can add up to significant waste. Sensory Logic is also eager to take facial coding outside the research room and is looking to partner with companies that provide eye-tracking technology. Such companies - EyeTracking, located in San Diego, and Tobii, in Sweden, are two - use special glasses worn by the consumer to determine where his eyes settle as he walks through a retail environment. Combine that with facial-coding technology and you can tell not just where people are looking, but how they feel about what they're seeing. The application has exciting implications for retailers, who could use it when designing their store layouts. Of course, it wouldn't be an emerging technology if there weren't disagreements over how best to apply it. Gallup & Robinson, a market research firm in Pennington, N.J., practices a different brand of consumer face reading. "Our focus is on what we call emotional valence," says G&R president Scott Purvis. "Most of the other systems are on what we would call arousal." To the layperson, the difference between what Sensory Logic and Gallup & Robinson do may seem tiny. But it's significant. Put simply, emotional valence is the measurement of all human reactions on a scale of negative to positive. So Gallup & Robinson is less concerned with whether you're smiling or frowning than how intensely you're doing one or the other. "The idea is that people have a positive and a negative rewards-type system in their brain," says Purvis, "and these things operate both at the same time, so you can feel both very positive and negative toward a stimulus at the same time. It's not ends of a scale, it's two different systems, so that's why people are often ambivalent about many of the things they're seeing. We're trying to get at that relationship, rather than whether somebody is disgusted or happy." Purvis uses the example of a typical pharmaceutical commercial, the kind that begins with patients suffering from an ailment, then features a (frequently animated) illustration of the treatment working, followed by scenes of a healthy, happy patient. The intensity with which a viewer follows those phases of emotion "can be very important in terms of overall effectiveness of the commercial," he says. "And I don't know that we understand it as well when looking at it from the point of view of, 'Did you like it?'" Not surprisingly, Hill doesn't put much stock in emotional valence. He points out that there is a wide range of emotions that can be considered "negative," not all of which are the ones you may want your commercial to inspire. "Sadness versus anger versus fear are all quote-unquote negative emotions," he says. "But those emotions can not only be vastly different in their meanings, but also in their implications for your creative." Hill, too, uses the example of a pharmaceutical commercial to illustrate his point. "You're trying to create a problem-solution commercial, so you're supposed to make your viewer feel sadness at first because they're disappointed with the status quo," he says. "But what if you're actually making them angry because they're confused? Then you've lost them." Hill even has a term for it. He calls it being "off-emotion," as in being off-message. Measuring emotional valence comes with some other trade-offs. Rather than making video of a subject, Gallup & Robinson attaches electrodes to his or her face, specifically at the frown and smile muscles. The process, known as electromyography, or EMG, may do a more accurate job of measuring the intensity of muscular reaction - but it doesn't travel well. "There's some work being done now to use the camera to distribute it over the Internet so Webcams would be able to get an EMG-type response," says Purvis. "But so far it hasn't gotten to the point where I think people have a lot of confidence in it." Regardless of which method you put your faith in, there's a good reason that both remain little more than a theoretical threat to traditional market research: They have a serious scalability problem. Both approaches require trained professionals to translate the results. Training such professionals is said to take up to 100 hours; of course the process of watching the videos and drawing conclusions takes many hours more. So while face reading makes a nice complement to focus groups or questionnaires, they've never really been scalable enough to replace them. Enter ThirdSight. This 11-person firm in the Netherlands may be the newest thing in face-reading market research, having been spun off from the University of Amsterdam on January 1, 2011. ThirdSight's signature technology is software that reads and interprets video of test subjects' facial expressions, eliminating the need for a pricey, highly trained researcher to wade through hours of slow-motion video. "The software detects the face of the subject, then localizes landmarks like mouth corners, cheeks and eyebrows and tracks these facial features over time with a grid like a spire," says Theo Gevers, scientific advisor at ThirdSight and an associate professor of computer science at the University of Amsterdam. The software is taught to recognize facial configurations that correspond to six different emotions, so it can tell instantly how a test subject is reacting to content. ThirdSight has even created a smartphone app that can read and interpret a user's facial expressions. "It's not yet real time," says Gevers, "so it will record your face and then process it." But that will change quickly as smartphone CPUs become faster and more powerful. The drawback to ThirdSight's process is an admitted lack of accuracy. "We might have some disadvantages in the sense that people who have been trained for 100 hours might be a little bit better" than the software is at reading the subtleties of facial expressions, Gevers notes. "We have a fairly accurate system, but it's not as good as a human operator." Still, the potential effect of scalable facial coding on the world of market research is huge. Imagine a world in which consumers anywhere could download an iPhone app that records their faces as they watch a commercial - which also plays on their phones, incidentally - then instantly beams back that person's emotions to a waiting database. Today, companies like Sensory Logic and Gallup & Robinson are limited to running sessions with about 40 people; more than that would simply be untenable given the man-hours that go into interpreting the results. But a smartphone app equipped with software that can read faces in real-time has the potential to make facial coding an easy, inexpensive mass-market research tool with a higher level of reliability than anything available today. "The conservative estimation is that 95 percent of people's thought activity isn't fully conscious - that we're mostly intuitive, subconscious decision makers," says Hill. That, more than any other reason, is why simply asking consumers how they feel about a product or campaign is bound to come up short. No matter how much they want to tell the truth, people just might not be able to. Bypassing the consumer to go directly to his brain, courtesy of his expressions, may be the market research industry's best chance to save face.

FT: Case study - Trung Nguyen coffee

Case study: Trung Nguyên coffee

By Morgen Witzel

Published: April 27 2011 23:08 | Last updated: April 27 2011 23:08

Mr Vu positioned his brand as part of a Vietnamese tradition

The story. Coffee cultivation in Vietnam began under French colonial rule in the 19th century and soon became a staple industry. By the mid-1990s, the country had become one of the three biggest coffee producers in the world.

Much of it, however, was low quality and sold at cut prices overseas. Vietnamese-American entrepreneur Dang Le Nguyen Vu believed high-quality Vietnamese gourmet coffees could be produced and sold profitably. So, in the mid-1990s, he launched Trung Nguyên, a coffee manufacturer and café chain.

EDITOR’S CHOICE

Case study: How to avoid complacency - Apr-20

Case study: Porter Airlines - Apr-06

Case study: Anglo American - Mar-30

Case study: Walmart - Mar-23

Case study: Cirque du Soleil - Mar-16

Case study: Axa’s rebranding - Mar-09

The challenge. Vietnam is an emerging market. In 1995, per capita income was only $250 (the 2010 figure was $1,200). This was one reason why Mr Vu chose to develop a luxury brand that would appeal to both domestic and export markets.

To do so, he would have to persuade the home market that his expensive product offered value, and convince overseas customers that Vietnam could produce gourmet coffee.

The home market. As the owner of a coffee-processing business, Mr Vu could improve the quality but there was no efficient distribution network. The answer was to set up a chain of coffee shops, modelled in part on Starbucks, that would also sell coffee beans for home consumption.

The branding of Trung Nguyên was carefully planned. To counter competition from big multinationals, whether coffee shops or brands such as Nescafé, Mr Vu positioned it as part of a Vietnamese tradition. A Trung Nguyên museum tells the history of coffee-making in the country.

One of Trung Nguyên’s best-known products is kopi luwak or “weasel coffee”, made from coffee berries that have passed through the digestive tract of a civet cat. Marketing this expensive delicacy, which is harvested only in south-east Asia, helps identify Trung Nguyên with Vietnam’s coffee culture.

Combining heritage and modernity is at the heart of the brand, whether in the packaging or the styling of the coffee shops. Straplines such as “Bringing creativity into coffee” suggest innovation.

By pricing the coffee high, Mr Vu appealed to the aspirations of Vietnamese people. An emerging middle class took to the brand and the coffee shops became important social centres. The first Trung Nguyên coffee shop opened in Ho Chi Minh City in 1998, and by 2010 there were more than 1,000 across Vietnam.

Trung Nguyên has also diversified into decaffeinated and instant coffee and tea production.

The overseas market. Export was part of the strategy from the start. Trung Nguyên now markets its coffee in more than 40 countries, including the US and the UK.

Most of the brand’s appeal is to niche markets, to consumers interested in exotic coffees and, especially in the US, to visitors to Vietnam who have seen the brand there. Most of the coffee is sold online through franchisees. Sales volumes are very small compared with those in Vietnam.

Attempts to replicate the domestic coffee shop branding strategy and set up Trung Nguyên outlets overseas have met with mixed success. There are now two stores in Singapore and a few elsewhere in the world. But, generally, in spite of its success in Vietnam, the Trung Nguyên brand is not well-known elsewhere.

Current challenges. Trung Nguyên must expand its export market if the company is to continue to grow. Although rising prosperity in Vietnam means there are opportunities for domestic growth, Trung Nguyên is under pressure from competitors.

Key lessons. Creating a luxury brand in an emerging market might seem contradictory. But the Trung Nguyên case shows how it can be done. By appealing to national culture and values, and creating an aspirational brand with which rising middle classes could identify, it transformed the coffee market in Vietnam.

However, Trung Nguyên has also learnt that extending the brand overseas will take longer, and require more finessing.

The author is honorary senior fellow at the University of Exeter Business School

Copyright The Financial Times Limited 2011.

WSJ: Uniqlo Pop-up Store Targets Sweaty Tokyo Commuters

Impressed with Uniqlo on their sales approach!

 

April 22, 2011, 11:59 AM JST

Uniqlo Pop-up Store Targets Sweaty Tokyo Commuters

Pop-up stores aren’t new. Nor are casual-wear chain retailer Uniqlo’s ‘Silky Dry’ and ‘Sarafine’ innerwear summer lines, designed to help wearers stay cool.

Uniqlo

Uniqlo’s pop-up store at the Ikebukuro subway station in Tokyo.

But the March 11 disasters knocked out a significant chunk of power utility Tepco’s electricity production capacity. And the possibility that a shortage of energy this summer in Japan will leave air conditioners idle as citizens drip with perspiration more intensely than the past is a very real and new scenario.

The likelihood has Uniqlo, the flagship chain of Fast Retailing Co., mashing the two well-worn concepts to test the likely pick-up in Tokyo commuter demand for the tech-savvy clothes: A pop-up store selling exclusively silky dry and sarafine innerwear products.

Uniqlo, ubiquitous in Japan, Thursday opened a temporary shop in the hubbub of Tokyo’s Ikebukuro station, one of the capital’s busier intersections. The merchandise is strictly apparel made using the cool summer-wear lines – a counterpart to Uniqlo’s popular winter hit, “Heat Tech” innerwear that’s designed to retain body heat.

The store, which looks roughly like a raft that docked in the middle of the station, will carry the basic innerwear lineup: crew necks, v-necks, camisoles and boxer briefs, among others, typically retailing for 990 yen, or about $12. The store will be open until June 26.

Launched in March last year, the Silky Dry line is for men, while the Sarafine garb is for women. The retailer touts the material of the men’s line as being like “a second skin” that’s barely perceptible. Sarafine’s fabric is made of “breathable fibers” woven together with nylon specially produced by fibers company Toray Industries Inc. The stretch fabric of both, the company says, absorbs and removes sweat and keeps body odor at bay.

Copyright 2008 Dow Jones & Company, Inc. All Rights Reserved

Economist: Peggy Sue got old

Media's ageing audiences

Peggy Sue got old

Viewers, listeners and readers are ageing fast. Oddly, media companies don’t regard that as a catastrophe

Apr 7th 2011 | from the print edition

A FEW years ago Universal Music Group spied a gap in the market. How about a CD for people who grew up in the 1950s and wanted to revisit the pop music of their youth? The label pulled together songs by British and American artists, some well-known (Buddy Holly, Roy Orbison), others largely forgotten. “Dreamboats and Petticoats” was released in time for Christmas 2007.

That gap turned out to contain a seam of gold. “Dreamboats and Petticoats” has sold enough copies to be certified as double platinum. It has inspired a West End musical and three follow-up albums, with another due in November. In total the series has sold 2.3m copies, mostly in Britain—a country where fewer than 120m albums were shifted last year. And virtually everybody who bought the album forked over money for a compact disc. “They don’t download, and they don’t want to download,” says Brian Berg of Universal.

“They” are consumers in late middle-age or beyond, who increasingly drive the music market. In Britain people aged 60 or over spent more on pop-music albums in 2009 than did teenagers or people in their 20s, according to the BPI, a trade group. Sony Music’s biggest-selling album worldwide last year was “The Gift”, by Susan Boyle, a 50-year-old Scot whose appeal derives in part from her lack of youth. And what has happened to music has also happened to other forms of entertainment.

The noisy disruption of media business models by the internet in the past decade has obscured a profound demographic transformation. Whether they are buying music, listening to the radio, reading newspapers or watching television, media consumers are ageing even more quickly than the overall population. Rather than trying to reverse this trend by attracting younger people, many companies are attempting to profit from the greying of media.

Grey anatomy

In America the audiences of all four big English-language broadcast networks are looking middle-aged. Since 2003 the median age of a prime-time CBS viewer has increased by three years, according to Nielsen, a research firm. Viewers of ABC and NBC are five years older; Fox’s, seven and a half. In that time the median age in America has probably risen by a year and a bit. Some shows are greying faster than the networks that carry them, in part because they have fan bases that are ageing naturally. The audience that tunes in for the desperate housewives of Wisteria Lane is approaching 50 (see chart 1).

Indeed, every network except Fox had a median age of 50 or over last year. That is significant because advertisers tend to be most interested in how a show rates among people aged between 18 and 49. As Alan Wurtzel, head of research at NBC, puts it, a growing proportion of viewers are becoming almost invisible to marketers—“forgotten but not gone”.

If broadcast television is growing old gracefully (helped by Botox injections), newspapers are racing towards senescence. Between 2002 and 2010 the proportion of American papers’ regular readers who were aged 55 or more rose from 37% to 46% (see chart 2). Fully 43% of readers of Britain’s Daily Telegraph and Daily Express are at least 65 years old, according to the National Readership Survey. Such papers are littered with advertisements for comfortable shoes, cruises and stairlifts.

The reason why newspaper readers are ageing so quickly is simple: the young are abandoning print faster than everyone else. They may pick up free papers to read on public transport, but when reception is good they tend to plump for mobile phones and the internet. The Pew Research Centre, an American think-tank, finds that 65% of 18- to 29-year-olds describe the internet as their primary or secondary source of news. Only 14% of people aged 65 or over say the same.

In music, too, the young have drifted to illegal file-sharing and, more recently, to free streaming services such as Spotify. By and large, the middle-aged and old have not. David Munns, who manages Bon Jovi, a rock band that was formed in the early 1980s and is still going strong, notes that older fans have more money and more scruples. They also regard illegal downloading as “too much work”, he says. Bon Jovi’s “Greatest Hits” was the 15th-biggest-selling album in the world last year.

As the young cut back on conventional media, their elders consume more of it. In Spain 54.2% of people aged 55 to 64 routinely listened to the radio last year—up from 46.6% in 2000. As a result, the Spanish radio audience has greyed even as overall listening has risen. Japanese baby-boomers carry on buying music at an age by which earlier generations had largely stopped. Singers who appeal to the middle-aged and old, such as Hideaki Tokunaga and Junko Akimoto, rule the charts.

The same is true of television. British 55- to 64-year-olds spent an average of five hours and ten minutes a day watching television last year—50 minutes more than in 2001. The middle-aged and old now have free digital channels dedicated to their tastes, such as ITV3, home of wrinkly detective dramas, and the highbrow BBC Four. They have seized on easy-to-use gadgets like digital video recorders, which increase their enjoyment of television.

The young are not watching less TV. But some of their viewing is now done through computer screens. And much of it is of unconventional channels. Instead of the evening news, American 20-somethings watch “The Colbert Report”, a spoof news show. MTV has moved beyond music videos into reality shows, and is enjoying its best ratings in years. Media outfits that appeal to immigrants and their children often have youthful audiences. Univision, a Spanish-language broadcast network, boasts a median age of 37.

Now they’re 64

Greying audiences are causing discomfort among media executives. But not as much discomfort as you might expect, given the industry’s long preoccupation with youth. The ageing of the large baby-boom generation means there are a lot of potential customers in their 50s and 60s. Furthermore, the executives argue, people of this age are worth much more than in the past.

The practice of measuring television audiences by the number of 18- to 49-year-olds they contain is simply an historical anachronism, argues Mr Wurtzel of NBC. David Poltrack, his counterpart at CBS, agrees. It used to be assumed, he says, that older people had already worked out which brands they liked and could not be persuaded to try new things. But the middle-aged have taken to toys such as e-readers and iPads. Mr Poltrack has devised an alternative way of classifying viewers that emphasises tastes and attitudes to media (for example as “sports enthusiasts” or “surfers and streamers”) rather than age.

It is not surprising that ageing television networks should argue that the old are becoming more valuable. But the West’s economic slump has given force to their claims by sapping the earning power of the young. In March the unemployment rate among Americans aged 20 to 24 was 15%. For 16- to 17-year-olds it was 29%.

Lack of work has combined with tighter lending standards to squeeze young people’s buying power. Between 2007 and 2009 average spending on new cars and trucks by Americans under 25 fell by half, according to the Consumer Expenditure Survey. It fell by 31% among people aged between 25 and 34. By contrast, expenditure by those over 65 was flat, and the over-75s actually spent more, on average. The young also spent less on audio-visual equipment and services—that is, television sets and cable TV—while the old shelled out more. This helps to explain why advertising money has flooded back to the ageing broadcast networks since the recession. Advertisers are not so in thrall to the cult of youth that they are prepared to overlook such a shift.

Desperate, but not for younger viewers

Another reason why media companies are not too worried about the ageing of their audiences has to do with a change in business models. A firm that depends on advertising needs to attract valuable consumers. A firm that relies on subscriptions, by contrast, cares only whether its consumers pay their monthly bills. And perhaps the strongest trend in media in the past few years—stronger even than ageing—is the growing reliance on subscription as a means of paying for content.

BSkyB, Discovery Communications, ESPN, Netflix: many of the media industry’s best-performing companies and hottest stocks of recent years rely on subscriptions. The recession may have slashed advertising and discretionary spending. But most people carried on paying the bills for entertainment. As a result, subscription-based businesses were able to sustain spending on content. So clear are the advantages of these businesses that even firms that have habitually relied on advertising are moving to copy them.

As newspaper advertising has declined, publishers have raised the prices of subscriptions and single copies. Last year 41.3% of the New York Times’s newspaper revenues came from subscriptions—up from 28.8% in 2007. Similarly, broadcast networks are battling for “retransmission fees” (essentially a cut of subscriptions) from cable and satellite distributors. As the broadcasters become less dependent on advertising, sheer numbers will come to matter more than demography.

The clearest sign of this shift is the appearance of online paywalls. Last month paywalls went up around the New York Times and the Dallas Morning News. The websites of Britain’s Times and News of the World began to restrict access to subscribers last year. Hulu, an American website that carries broadcast TV programmes, and Spotify, a European music-streaming service, are both pushing subscriptions.

One good reason for media firms to erect paywalls is that new media are beginning to age, too. The proportion of people aged 65-plus who get most of their news from the internet may be only 14%—but in 2006 it was a mere 2%. Online video streaming began as a young person’s hobby but has increasingly become mainstream. “Often it’s the young who adopt a technology, but others follow them,” explains Patricia McDonough, a television analyst at Nielsen.

With a few exceptions, media firms have found it hard to make money online. Consumers seem to tolerate fewer ads, and rates are low. When digital media were the province of youth, this did not matter much: media firms could argue that they were at least promoting their brands to young people, while deterring them from piracy. But let the middle-aged and the old, too, discover they can have entertainment for nothing? That would not do.

from the print edition | Briefings2

Fast Company: How to Build an Unforgettable, "Smashable" Brand Identity (Hint: It's not the Logo)

April 11, 2011

How to Build an Unforgettable, "Smashable" Brand Identity (Hint: It's Not the Logo)

By Martin Lindstrom

No, you don't have to tell me, because I know what you're about to say: your new product is brilliant. It's a game-changer. Problem is, you need a killer logo. Well, today, designers, inventors, and investors are facing a dilemma similar to the one that writers and artists have struggled with for decades: there's nothing left. Or here's another problem: if you do manage to create a jaw-droppingly clever or memorable image, rather than engendering widespread consumer recall of your brand, your Easter-blue palette risks looking uneasily similar to the Tiffany box, and your little black bull is a transparent rip-off of the one that dangles from the neck of Sangre de Toro red wine.

As far as the logo is concerned, to paraphrase Bill Maher, it's time for New Rules. Today, what counts far more than a puma, a monkey, or a snarling aardvark is the cross-sensory experience your brand offers. I'm talking not only the emotion, beliefs, and desires your brand evokes, but its feel, touch, sound, smell and personality, of which the logo is just one small part. Whether it's a soda can, a car, a doll, a fragrance, a smartphone, or laptop, your brand needs to be smashable, e.g., instantly identifiable via its shape, design, copy, contours, and even navigation. Aside from adolescents, who are always on the lookout for the coolest logos to set them apart from, or help them gain traction with, their peers, today for most consumers the logo comes in near-to-last place to other considerations.

Why? Well, various reasons. The first is, when we see a logo, our defenses go up and stay up. We fear we're being played, or manipulated. Not least, I might also add that subconsciously, a logo reminds us of our complicity with big brands, of our own shot-with-guilt overconsumption that helped drive the world's recent financial downfall.

The term "smashable" dates back to 1915, when the Coca-Cola company asked a designer in Terre Haute, Indiana, to design a bottle that consumers could still recognize as a Coke bottle, even if someone flung it against a brick wall and it shattered into a hundred pieces. Coke is a smashable brand. So are Guinness, Ferrari, Harley-Davidson and, of course, Apple (take a sledgehammer to an iPad and you'll know what I mean). Which suggests that the logo as we once knew and loved it--from Citibank's Scowling Umbrella (I don't know what else to call it), to Nike's Swoosh, to Starbucks's Whoever-The-Heck-She-Is--needs to be re-considered if it's going to play any role in future brand-building.

Let's do a little experiment: Erase the logo from every single one of your brand identifiers--products, stationary, signage. Close your eyes, now reopen them. Is there anything left? Would consumers still recognize those items as belonging to your brand? Look at your packaging, your copy, your colors, your design, your font, your spacing. Do any of them convey your brand's identity? Or without a logo are you adrift and bailing water?

Next let's examine your website. Again, by eliminating the logo, you'll embark on a fun (I promise) and instructive exercise that will relieve you of any stubborn logo-fixations that may still be nagging at you. It's one that will force you into acknowledging the value that every single one of your communication elements plays in defining your brand's identity. Okay, still hiding the brand logo, eyeball your copy, your graphics, whether your pages are spare or dense-looking. Do all these things convey what your brand represents? Does your brand have a personality anymore, or is it standing shyly and stiffly against the wall, hoping no one notices it now looks (I hate to tell you) like every other brand out there?

To wrap up, let's have a look at your navigation. By navigation, I'm talking about everything from the iPod's clicking wheel, to the ritualized twist and snap you hear when you open your favorite soft drink, to Amazon's simple, one-click button you press to buy books or download them onto your Kindle. In my experience, once consumers have used Amazon a few times, they get hooked on the site's simplicity and navigational ease (During a recent round of focus groups, by a long shot Amazon was at the very top of consumers' favorite brands.). Sure, the site stocks every book (and everything else) under the sun, it over-delivers, it undersells iTunes, its data-mining techniques are on the positive side of creepy, but I'm pretty sure that most consumers' loyalty to the company derives in large part from Amazon's incredible and intuitive ease of navigation.

We're creatures of habit. Once we grow accustomed to a certain way of shopping, running, eating, drinking, shaving, brushing our teeth, showering, dressing, or any of 100 other things, our methodology becomes our own. Like the familiar, well-worn route we take to our favorite beach or restaurant, habit becomes personal, automatic, and unconscious. In the same way, navigational rituals are a vital, whispered element of any brand's attraction. Having said this, human beings are supremely adaptable. Basically, we can get used to anything. If you've ever switched cell phones, or made the change from an Apple to a PC, yes, at first it felt obnoxious and foreign and even wrong. But once we became accustomed to that new environment--be it a trackball or a new, melodic suite of start-up and shut-down sounds--nothing else would do the trick.

So reserve a brick wall, cock your arm, aim, and begin smashing your brand. While you're at it, smash your website, to ensure your brand remains consistent via your web pages' navigation, style, ease, and/or special features. Now ask yourself: does my brand "own" this cross-sensory experience, from web to wireless to PDA, right down to the bricks-and-mortar product I'm gripping in my right hand? If not, your carefully crafted logo might as well not even exist.

Martin Lindstrom is a 2009 recipient of TIME Magazine’s “World's 100 Most Influential People” and author of Buyology—Truth and Lies About Why We Buy (Doubleday, New York), a New York Times and Wall Street Journal best–seller. A frequent advisor to heads of numerous Fortune 100 companies, Lindstrom has also authored 5 best sellers translated into 30 languages. More at martinlindstrom.com [1].

Read more by Martin Lindstrom: The 10 Most Addictive Sounds in the World [2]

Top image via Lawrence Whittemore [3]; small photo via thewhitestdogalive [4]

Article location:http://www.fastcompany.com/1745884/how-to-build-an-unforgettable-smashable-brand-identity-hint-its-not-the-logo

Performance Insider: Putting It All Into Context

Putting It All Into Context

Jesse Chenard, Mar 31, 2011 01:15 PM

As each phase of online offerings prove, there are many reasons we spend an increasing amount of time searching, emailing, connecting with friends, colleagues and family, and entertaining ourselves with the amazing array of options available via a browser or mobile app. What state of mind are you in when you read your favorite news source, check sports scores, or gossip sites? What about when you are in the market for something (could be a car, could be a new recipe for dinner, information on health matters, whatever) or when you just need to connect, to feel like the people, places and opinions that matter most to you are close and accessible? Despite all the digital analytics, it's surmising your state of mind that is the ultimate goal: are you searching car sites because you are in market or because you just love to see new cars, or maybe you need to know what is coming down the pike in automotive offerings because your job requires it? What emotions are triggered by content is why endemic advertising is so highly prized. Knowing someone is actively engaged reading about new car models is one indicator that they may be in market for purchasing a car soon. Medical information about specific conditions is valuable to marketers of medicine for that condition because people who have the condition, or those that treat them, read it closely. That's why one of the most time-honored ways advertisers choose to engage with their intended customers is via association with content that triggers emotions, matching what the marketer hopes to activate - association and action because the state of mind is ripe for what the marketer is offering. When considering context, online widens the options for marketers in surprising ways. When your message is associated with content that is aligned with your message, the 'halo' effect heightens the message's impact. For example, most of us care about safety features in the cars we drive, but it's not necessarily the only reason we choose to buy one model over another. While reading an article on safety measures for children, ads highlighting features specifically about car models and brands in the context of safety can greatly increase engagement and improve brand metrics for the advertisers. Since few can afford to place their message indiscriminately to the fragmented masses, consider all options of filtering to find your ideal consumer at the ideal time. This has been the promise that's fueled mobile marketing's growth for years now. It's also why audience segment targeting is widely used. However, in the rush to target exactly the right people at the exact right time, we sometimes overlook the most powerful association available: contextually relevant content. Bottom line: if you put your brand in context, within content that is aligned with your product or service, and associated with the brand promise, you will gain valuable impact. Just because placing ads in context within specific content is an age-old technique for heightening advertiser results, doesn't mean it's no longer valuable. Indeed, today's fragmented audience and marketplace make context even more important than ever.

NY Times: Advertisers in Europe May Face Limits in Use of Keywords

 

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March 24, 2011

Advertisers in Europe May Face Limits in Use of Keywords

By ERIC PFANNER

PARIS — An adviser to the highest European Union court recommended Thursday that some restrictions be placed on the rights of advertisers to use the names of rivals as keywords to generate sponsored links on Internet search engines.

If the court goes along with the opinion, the decision could make some advertisers more cautious in their purchase of the search ads on Google, one of the fastest-growing areas of marketing in recent years, analysts said.

“With this opinion, Google’s customers may well reconsider how extensively they want to use a competitor’s mark as an AdWord,” said Kirsten Gilbert, a partner at Marks & Clerk Solicitors in London, referring to Google’s search advertising program.

The opinion was prepared by an advocate general to the European Court of Justice in Luxembourg, which is reviewing a lawsuit by Interflora, the flower delivery service, against the British retailer Marks & Spencer, which has a competing florist operation.

A search under the word “Interflora” on Google’s search engine in Britain turns up sponsored advertisements for three different Web sites: Marks & Spencer’s, Asda’s and Interflora’s. Interflora argues that this misleads consumers.

The lawsuit is the latest in a series of cases in Europe in which the parameters of search engine advertising, which generates more than $20 billion a year for Google, are being defined.

In a landmark decision last year, the Court of Justice ruled that Google was not liable for trademark infringement in a case brought by LVMH Moët Hennessy Louis Vuitton and other brand owners. LVMH argued that Google should block other advertisers from buying search keywords under LVMH trademarks like Louis Vuitton, saying these were often used to direct consumers to sites selling fake handbags and committing other trademark violations.

Rather than suing Google, Interflora went after a user of the service, Marks & Spencer. Nevertheless, if the court goes along with the advocate general’s opinion, something it generally does, the decision could have financial ramifications for Google if advertisers have less latitude to buy rivals’ brand names as keywords for so-called sponsored links, analysts said.

They added, however, that the effects could be limited by the specifics of the case, which centered on the possibility that consumers might be confused by Marks & Spencer’s ads, thinking that they were actually directing people to Interflora’s own network of florists.

The advocate general, Niilo Jääskinen, said advertisers should be blocked from buying rival trademarks as keywords if an ad “does not enable an average Internet user, or enables the said user only with difficulty, to ascertain whether the goods or services referred to in the ad originate from the proprietor of the trademark or an undertaking economically connected to it or from a third party.”

Marks & Spencer declined to comment on the opinion. Interflora did not immediately respond to a request for comment.

Google said the decision was “broadly consistent” with the decision last year.

“We believe that user interest is best served by seeing more relevant ads, ensuring useful and informative advertising for a wide variety of different contexts,” Google said. “We also believe that consumers are smart and are not confused when they see a variety of ads displayed in response to their search queries.”

Engage Teens: Tribal Marketing

By Tina Wells Thursday, March 24, 2011

Tribal Marketing

If you enter a roomful of crying but healthy babies, chances are they all share at least one of the same needs: food, sleep, a diaper, or some undivided attention from a loving grown-up. As they grow into early childhood, they will hit the same developmental benchmarks at roughly the same time, and they'll still want and need lot of the same basics (snacks, naps, potty, hugs), though they are beginning to assert their distinct personalities. Even before preschool, the differences start to emerge. This kid loves soccer, that one only wears sandals, this kid cares about animals, this one is afraid of animals, and this kid collects menus. And so it goes as they grow, with each young soul becoming his or her own person.

Any parent or teacher will tell you that, although they may have similarities, all children are different. Yet we consistently make the mistake of behaving as if they all want and need the same things. While this is obviously practical and necessary on many levels, children become even less alike as they grow into their tween and teenage years -- and we still often act as if they're all cut from the same cloth. This true paradox is that tweens, especially, are bursting out of their early childhood selves, trying to figure out where they fit in, attracted to and afraid of the idea of more independence. They want to be "like the other kids," but they have already formed a distinct set of likes and dislikes. They face a substantial challenge in striking a balance between being like their peers and flexing their one-of-a-kind personalities.

Marketers -- and society in general -- have typically categorized people by their age. You might read something like, "Adult males between the ages of 35 and 45 are more likely to have a Facebook account than adult males between the ages of ..." or "New Yorkers between the ages of 15 and 18 are using the subway at alarming rates." Classifying people by age makes it easy to survey them and is often appropriate. However, in an era of growing individualism and the use of technological profiles to display individual characteristics, it's important to see past the demographic boundaries and begin to define people based on their cultural attributes -- instead of focusing first on numbers.

While we may be inclined to think of them as "ages 9 to 12," the 12 year old may be making the same choices as a 15 year old, and the 9 year old may be an early adopter of certain trends, regardless of his or her age. It's not about how we view them; it's about how they define themselves -- and how the lines often blur between the tween and teenage groups. With that in mind, I've developed a new system for looking at teens and tweens by separating them into four tribes: the wired Techie; the conformist but somewhat paradoxical Preppy; the always-mellow Alternative; and the cutting-edge Independent. We'll have look at each of these in further detail, but first, it's important to explain why we need to look at Millennials in this way.

At some point, we began to blur the lines of which brands, products, and services should be consumed by whom. In another post, I'm going to talk in depth about the concept of a "tweenebe." Tweenebes are adults who want to be tweens. Now, they may not truly want to be 12 again, but they are consuming a 12 year old's culture and loving it. Do you know those moms who love Justin Bieber? Are you one of them? Do you know dads who seem to enjoy rocking out to the Disney channel more than they should? It's okay; they're just enjoying the benefits of being a tween. I have to admit, in a society full of major economic, social, and political concerns, we'd all love to fawn over the latest tween singing sensation, read a Twilight book, or grab a Frappuccino with friends. Oh wait -- don't we already do those things? I think that there are more tweenabes out there than I can even imagine.

As we look at these tribes, we have to ask ourselves: Do you have to be 13 to be a Preppy? Twenty-something to be an Independent? No, you don't. That seems like an easy question to answer, but it has stumped marketers for generations. Now, I doubt that you'll see an ad for Tampax Pearl in Sports Illustrated or a Justin Bieber ad in AARP magazine, but you will see major brand extensions happening over the next few years. And I'm not talking about product development; I'm talking about market development. Marketers have to get outside of thinking in boxes, whether it's ages 7 to 12, 13 to 19, or 20 to 24.

Technology has created so many generationally shared experiences. Facebook is no longer for elite college students. Indeed, the fastest-growing demographic on Facebook is women over 50. How people think, feel, and react to brands is a completely new experience. Because of that, I've developed four tribes that I feel are universal. I think that these tribes definitely have sub-tribes (which I'll explore in the future at some point), and I do believe that consumers can belong to more than one tribe. But the tribal migration is happening, and has been happening for years. As with any good disruptive innovation, technology has forced us to deal with this issue.

Ten years ago, if you wanted to launch a new product for teens, you'd probably launch a major ad campaign in a teen magazine like Seventeen. You would likely reach more than 10 million girls and call it a day. Fast-forward to 2011, where readership of Seventeen is now about 4 million. Where did all those readers go? Well, they're online, of course. They're on thousands of web sites. How are you going to find them? Well, sure, you can just launch a campaign on a network of web sites and hope that you're going to reach your entire target.

However, there's an easier way. Targeting a tribe is also about understanding a mind-set. A tribe is defined as a "social division of people." The key word here is social. Social involves so many things. What are people doing? How are they doing it? With whom are they doing it? How often? How long? When? Where? This is starting to sound like an invitation to the best party. That's the mind-set a marketer should have when thinking about tribes, and that's why tribal marketing works.

If you start to think about these consumers -- Preppies, Techies, Alternatives, and Independents -- as tribes, and then think about all of their social activities, you can easily figure out how to reach them. Then you won't just be bowling in the dark. You will hit your mark every time.

NY Times: As the Web Turns

January 12, 2011

As the Web Turns

By ANDREW MARTIN

Hey, fellas, want to spice things up with your lady? Procter & Gamble, the consumer products giant, has some ideas.

A Web site created by the company for husbands and fathers offers articles with titles like “Conquering Sex Problems.” Among other things, the article advises men to take their time in bed.

“If you want a hot woman who acts like a porn star in bed, you need to be prepared to spend some time getting her to that place,” suggests the site, ManoftheHouse.com.

While the Internet is crowded with all kinds of sex advice, P.& G. — the maker of Pampers and Ivory soap and the nation’s largest advertiser — says it has found an untapped marketing opportunity for its products in the family man.

Much of the popular sex advice for men, in publications like Maxim and GQ, is directed toward singles on the prowl, the company says. Even its top rival, Unilever, has gone decidedly raunchier in a campaign for Axe, a grooming brand aimed at young men, that includes a double entendre about cleaning sporting equipment and a man’s private parts.

The P.& G. site gets out of the bedroom, offering tips on grilling burgers, cleaning toilets and disciplining children. It promises, “We’ll make men out of you yet,” while also promoting Gillette razors, Head & Shoulders shampoo and other company products.

“What we are trying to do is speak to the whole man,” said Jeannie Tharrington, a spokeswoman for Procter & Gamble Productions. “Certainly, relationships and sex are part of an adult man’s life.”

Josh Bernoff, senior vice president at Forrester Research who has written about P.& G.’s marketing efforts, said ManoftheHouse.com was not so different from “As the World Turns,” the TV soap opera that was another P.& G. innovation.

“This is the 21st-century version of the soap opera,” he said. “It’s information. It’s topical.”

More and more big companies have discovered the how-to genre as a marketing tool. General Mills offers dieting advice and coupons on Tablespoon.com, and Wal-Mart has a Web site in which mothers blog about everything from being frugal to reviewing products.

Jeremiah Owyang, a partner at the Altimeter Group, a digital strategy consulting firm, said company-generated lifestyle sites could be effective as long as they did not push the brands too hard. Reviewing the homepage of ManoftheHouse.com, he said, “All of these discussions on this page are already happening on Facebook,” he said. “The reason these things do work is that consumers are already having these discussions, having a healthy breakfast, talking about their wives in relationships.”

Ms. Tharrington said company research found that men were going to women’s Web sites to find information on recipes, cleaning the house or getting a stain out of a shirt. As for sex talk coming from a company that has honed a wholesome image — remember Mr. Whipple? — she said, “For us, it’s part of it, but it’s not the whole thing. What we try to do is be tasteful.”

Procter & Gamble has a long history of unusual marketing. The Cincinnati-based company created one of the first radio soap operas as a way to market its products, and years later it created its own soap operas, including “As the World Turns,” for television.

In the last decade, Procter & Gamble was one of the pioneers in word-of-mouth marketing campaigns in which mothers and teenagers were plied with samples and coupons to draw more customers.

In 2000, the company introduced Beinggirl.com, which provides information and expert advice on issues that teenage girls might be too embarrassed to ask a parent or a doctor about, like menstruation, eating disorders, acne and dating. The site also advertises P.& G. tampons and offers free samples.

In the years since Beinggirl.com was created, Procter & Gamble has started several other lifestyle Web sites, including one that is directed at women, Homemadesimple.com. David Germano, the general manager of ManoftheHouse.com, said consumer data showed that 10 percent of the visitors to the women’s site were men.

ManoftheHouse.com has brought on several writers who had established father-focused blogs. Karl Withakay, a Utah-based singer and songwriter who writes some of the sex articles, including “Conquering Sex Problems,” was already writing about relationships for other media outlets.

“The pieces he wrote were based upon his own experience,” said Craig J. Heimbuch, ManoftheHouse.com’s editor in chief, in an e-mail. “I appreciate his perspective a great deal. It lends itself well to the tone of the site, which is men helping men.”

So are men drawn to a PG-rated Web site when so much R- and X-rated competition is out there? Procter & Gamble says that so far it is pleased with the number of visitors. The site was started in June, and by December it had topped a half a million monthly unique visitors.

By comparison, AskMen.com, a site with similar, if more titillating content, had 5.5 million unique visitors in December, according to comScore, the market research firm.

Jonah Disend, chief executive of the brand strategy firm Redscout, questioned whether ManoftheHouse.com would generate a big following. He said men tended to be more interested in specialized publications about a specific hobby or sport.

“Just because no one’s doing it doesn’t mean there’s a real market for it,” he said.

Racy also works. Indeed, that is just what Procter & Gamble’s archrival, Unilever, discovered in its efforts to market Axe. The campaign it started last year, which included the double entendre, has become a sensation; last month, Zeta Interactive proclaimed the ads as having received the most social media buzz in 2010.

“We’ve taken a calculated risk,” said Heather Mitchell, a Unilever spokeswoman, “knowing what resonates with our guys.”

FT: Brands that laugh all the way to the bank

Brands that laugh all the way to the bank

By Rhymer Rigby

Published: January 6 2011 21:51 | Last updated: January 6 2011 21:51

Passengers on Kulula, the South African airline, might find themselves looking twice when they gaze out of the terminal window at their aircraft. Last year, the carrier painted one of its jets in what it calls its Flying 101 livery. The aircraft is now a shade of green with text on the fuselage. Next to words such as “co-pilot”, “engine #2” and “black box”, arrows indicate their location.

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“Humour is part of our brand ethos,” says Nadine Damen, Kulula’s marketing manager, “although it’s almost less about being funny and more about being down to earth and honest. We have other aeroplanes painted in cow spots, camouflage and one with a zipper down the side.”

A sense of fun, she says, runs through the brand. “Our safety briefing was written by comedians. We got a lot of flak for this at first but what we discovered was that using a bit of humour actually makes people listen.”

Humour is one way that brands can punch far above their weight in terms of awareness. When it works, a funny campaign or brand identity can differentiate a commodity product from its peers.

“In a few sectors like beer, it’s almost a category norm,” says Jim Prior, chief executive of The Partners, a branding consultancy. However, he adds, it is hard to do well. “Generally, you see some humour in advertising, which is quite discreet. But it’s rarely all that funny and it rarely goes all the way through. To do that, you have to be brave and confident.”

Many brands manage to be sporadically funny but those that successfully build themselves around humour are far more unusual. The UK soft drink brand Tango did it from the mid-1990s with a series of advertisements. The most popular featured an orange blobby man who slapped drinkers with the catchphrase “You’ve been Tangoed”, a slogan that passed into common usage.

A more recent example is Comparethemarket.com, the insurance comparison site whose brand identity centres on a Russian meerkat called Aleksandr Orlov and the fact that comparethemarket.com is easily confused with comparethemeerkat.com.

“In 2008, we’d been going for a year and research suggested we had a big issue with name recognition,” says Kal Atwal, the website’s managing director. All the comparison sites “had ‘compare’ in their names”. The campaign had a tangible impact: monthly site visits have gone up from 50,000 to 2m.

The meerkat has proved so popular that a number of spin-off products were launched, including an “autobiography” of Orlov that was published in time for Christmas. “Even the Russians seem to like him,” says Ms Atwal. “Russian TV covered the book launch.”

Humour can also reinvigorate older brands. Old Spice has found a new audience with its “Smell like a man, man” ads. Iain Tait of Wieden+Kennedy, the agency behind the campaign, says because a lot of men’s toiletries are bought for them by women, “we needed to create a character who was adored by ladies but who men don’t find threatening”. The answer was a character who combines extreme handsomeness with being funny. “It’s a very knowing kind of humour that comes from the character playing it straight,” says Mr Tait.

Why don’t more brands take the plunge? Mr Prior says companies worry that being amusing makes people question their credibility. But, he argues, “consumers are more sophisticated than that. If you take an airline, passengers know that airlines take safety very seriously.”

“[The Old Spice ads don’t] send up the product and he doesn’t make fun of himself,” explains Mr Tait. “You need to treat the audience with a bit of respect and credit them with intelligence. When you try and spoon-feed them the gag, that’s when it becomes embarrassing.”

Still, as the case of Kulula shows, the potential rewards are huge. “We’re a little airline at the bottom of Africa,” says Ms Damen. “Who in the wider world would have heard of us if we hadn’t done this?”

Copyright The Financial Times Limited 2011.

FT: Listening to customers can be bad business

Listening to customers can be bad business

By Lucy Kellaway

Published: October 17 2010 15:51 | Last updated: October 17 2010 15:51

Last week, for the first time ever, the mob on Twitter and Facebook forced the management of a big company into defeat. This victory of democracy over autocracy was scored over something people feel strongly about: whether three letters belong inside or outside a box.

For the past 20 years, the letters G-A-P have resided in a dark blue square, but two weeks ago the management of the clothing company announced that the letters had escaped and that a smaller blue square would henceforth sit above the P. All hell then broke loose. Thousands of people protested online and, a week later, Gap backed down. The big box was going to stay.

EDITOR’S CHOICE

Lucy Kellaway: We need CEOs who speak out - Oct-10

Lucy Kellaway: Posing and flattery beat an MBA - Oct-03

Lucy Kellaway: Jobs was clear, tetchy and right - Sep-26

Lucy Kellaway: Words to describe the glory of Apple - Sep-19

Lucy Kellaway: CEOs cry all the way to the bank - Sep-12

Lucy Kellaway: Personal life invasion - Aug-29

The new Gap logo was not obviously an improvement on the old one. And the sight of management listening to customers and accepting humiliation in order to satisfy them seemed like a good thing.

Yet what happened was not really good at all. It isn’t progress when a company panics and surrenders when faced by an armchair army of protesters. It is feeble.

Compare Gap’s experience to that of PwC, which changed its logo two weeks earlier. The new PwC look is an even uglier version of the new Gap effort, with the letters in italicised lower case, and not one, but a whole jumble, of little boxes scattered over the C. This logo was launched old-style, with corporate fanfare and a statement of customary idiocy from senior management, followed by customary sniping from journalists and from a couple of tweeters (people don’t care as much about accountants as about jeans) and that was that.

“We think our new brand expression visually distinguishes PwC in the same way that the quality and expertise of our people differentiates the experience of working with PwC,” said the firm’s chairman. Which is, of course, absolute, total tosh. Three little letters and some squares cannot say anything about quality or expertise at all.

But then logos are a fluffy subject; I have never heard anyone say anything that wasn’t daft about the thinking behind any change. This is because there never is any thinking, save the idea that it’s time to do something different.

PwC’s management evidently judged that time had come, and knows that any fuss will quickly die down. One day people may even become fond of the nasty new look – to the extent to which it is possible to be fond of the logo of an accountancy firm, that is.

Now back to Gap.

Once Marka Hansen, the company’s president for North America, got wind of the scale of the protest, she wrote a piece on The Huffington Post defending the “contemporary and current” new logo. Her post is a marvel for students of corporate language, with its “living and breathing”, its “alignings”, and its “journeys”. But mainly it is remarkable for its disingenuousness. Ms Hansen was surely feeling shock and awe at how badly her new logo had gone down, but claimed to be delighted that everyone felt so “passionate” about it.

The chummy message that she simultaneously posted on the company’s Facebook page was even more frightening for its attempt to get down with the kidz and talk the right chirpy language through gritted teeth: “Thanks for everyone’s input on the new logo! We know this logo created a lot of buzz and we’re thrilled to see passionate debates unfolding! We love our version, but we’d like to see other ideas. Stay tuned for details in the next few days on this crowd sourcing project.”

But even this didn’t work. The mob continued to show its passion by saying it hated the new design and, last Monday, she gave up.

This time the tone was more like when Princess Diana had died. Ms Hansen spoke of the “outpouring of passion from customers” on the company’s old logo and solemnly announced that the letters would stay in the box after all.

She should not have capitulated. By letting tweeters see the whites of her eyes, she has done other companies a disservice. Now that the mob has got its way on this, it is going to be harder for other companies to insist on their management’s right to manage.

Listening to customers is one thing, when they are voting with their wallets. But company logos should not be designed democratically on Twitter. If managers allow themselves to be frightened of the tweeting mob, they will become emasculated, change will be even harder than it ever was, and the status quo will always prevail.

[email protected]

Copyright The Financial Times Limited 2010.

ST: How to get ahead in advertising

Life!

Home > Life! > Life News > Story

Oct 23, 2010

How to get ahead in advertising

From fake bears to fake vandals, what will advertisers think of next?

By jay talking jeremy au yong

 

Today's topic is: Understanding modern advertising.

I am tackling this issue because I feel that many people don't have the intimate understanding of modern advertising that I do.

Of course, I say this in light of the Ulu Pandan bear. That was one heck of a misunderstood guerrilla marketing campaign.

All anybody wanted was for people to watch a video of a wild, potentially man-eating animal rummage for food at a bus stop near their home and their defenceless children and then go out and buy a whole bunch of electric shavers.

Was that too much to ask?

Instead, they went and reported the bear to the authorities. The next thing you knew, there were people with tranquilliser guns going around looking to shoot the bear.

Needless to say, very few potential shaver-buyers were amused when they found out the bear was actually just an advertising guy in a bear suit. In fact, many were furious. Those behind it were investigated by the cops.

In advertising circles, the whole thing was just another demonstration of how straight-laced Singaporeans always take threats to their lives too seriously.

Anyone else would have laughed at the prospect of getting mauled by a bear while waiting for the bus.

It wasn't like it was a bomb hoax. It's just a bear hoax. A bear can kill only one person at a time.

Nevertheless, even with the public nuisance charge, the subsequent public apology, the waste of resources and the unnecessary panic, many marketing experts would still say this campaign was a resounding success.

In fact, it's something of a coup.

The advertiser got a lot of attention and got it for a relatively cheap price.

And that's the first principle of modern advertising: It's all about attention.

It doesn't even matter if the attention comes in the form of people cursing you for the destruction you caused or if you get to sell any shavers.

What's important is that they've heard of you.

Of course, advertising did not start out this way. The early days in the trade were rather different.

In the beginning, advertising simply meant telling people what was good about your product so that they would buy it.

For instance, if you were a caveman with a rock to sell, you would tell your customers what was good about the rock.

Caveman Bob: 'This rock many good for pound on head of mighty dinosaur.'

Cavewoman Jill: 'Do you have it in pink?'

And that was it. If someone wanted a rock to hunt dinosaurs with, they'd just pick one off the ground because there were lots of rocks around in prehistoric times. They'd be silly to buy one. Also commerce had not yet been invented.

Early advertising was not very effective.

Then one day, a marketing pioneer came up with a novel concept that would forever change the industry: lying.

Cavemen were no longer limited to telling people what their rocks did, they could just make up stuff about it to make it more attractive.

Caveman Bob: 'This rock not just good for pound dinosaur. Also good for hips, thighs and abs.'

Lying was quickly followed up by lifestyle advertising.

Instead of just lying to you about the features of the product, they could also lie to you about the kind of lifestyle you might lead if you used the product.

Cigarette and alcohol companies loved it. They started putting out a great many advertisements implying that if you smoke and drank heavily, you would be slim, have a healthy glow and live on a yacht.

While these developments were great, they had drawbacks. For one thing, it was a lot of work for advertising firms to brainstorm concepts, pitch them and then rent yachts.

That's when they came up with the advertising we have today: guerrilla marketing.

By far the greatest benefit of this approach is that many older businessmen don't understand it.

The advertising firm tells them they need to get 'hits', 'go viral' and 'leverage on social media' and they just lap it up. They've no idea what it means.

That frees up advertising firms to do - well - whatever they feel like.

Suppose they felt like posting a suggestive Facebook message about liking it 'on the desk in the office'. They'd do it and then pretend later it has something to do with breast cancer.

Suppose, they suddenly felt like vandalising postboxes. They'd just go out there, spray paint some postboxes and pretend it is a good way to get publicity for a postal company.

That's right, advertisers managed to get paid to vandalise postboxes. I know a whole bunch of people who would do it for free.

Still, the campaign was so successful that when real vandals spray painted real graffiti on a train, people thought it was advertising.

And I'm not saying this is exactly how it happened, but suppose it is the night before the pitch for the electric shaver campaign was due and the ad people are out drinking instead of coming up with a campaign.

Suddenly, someone has an idea.

Drunk ad person #1: 'Hey, I have this bear costume I'm saving for Halloween. Wouldn't it be fun to put it on and scare some of my neighbours on the way home to Ulu Pandan?'

[email protected]

Hobbes' Airways

"If tigers were meant to fly, they would be born with wings."

AirAsia ad spotted in Straits Times. Reminded me of Hobbes... Nia...

 

FT: Sound advice

Sound advice

By Mike Southon

Published: October 1 2010 17:50 | Last updated: October 1 2010 17:50

Having the right image is vital for success in business. Significant effort and expense is devoted to marketing materials and websites – and we might even check ourselves in the mirror before a meeting. Rather less thought, however, is given to how our businesses sound.

But many customers are auditory, more interested in sounds than pictures. The clues are in the way they speak; they like the sound of what they are being told and say they would like to hear more.
A wise salesperson should continue talking, rather than showing pictures out of a brochure.

Julian Treasure understands the effect of sound in commercial environments. He began his career in advertising and then moved into contract publishing, producing in-house magazines for high-technology customers. At the same time, though, he pursued a parallel career as a musician, playing on two BBC [John] Peel Sessions and even making the final of 1980s talent show New Faces. He then brought his interests together to form the Sound Agency, a consultancy that helps its clients achieve better results by optimising the sound they make in every aspect of their business.

This includes making the sound in their branding and marketing communications congruent with their visuals, as well as designing and installing appropriate soundscapes for shops, offices and corporate reception spaces.

Treasure explains his techniques – and the benefits of having the right sound in the business environment – in his book Sound Business (Management Books). We are constantly suppressing unwanted noise such as traffic, he writes, so our relationship with sound is largely unconscious. Some effects are physiological, such as the sound of an alarm clock, which increases the secretion of the hormone cortisol, normally associated with stress. Other sounds have a positive effect, such the sound of the sea, which has a similar tempo to the breathing patterns during sleep, and is therefore relaxing. Listening to several people speaking at once has a negative effect: Treasure explains that people working in open-plan offices are 66 per cent less effective in their jobs than those working in a peaceful environment. His advice for those who have to work in noisy environments is to use headphones and to play the sound of birdsong.

Most important in a business context are the behavioural effects of sound. Treasure shows that retail environments can drive away up to 28 per cent of business by playing the wrong music. The songs that the managers and staff enjoy may not be the same as those that encourage the customers to linger, browse and buy.

The unconscious relationship we have with sound was illustrated perfectly by the members’ club where Treasure and
I met. I had been there many times without noticing the unfortunate acoustics of the room, which were not helped by regular interruptions from the cappuccino machine. The hand dryer in the men’s bathroom was only a few decibels short of an aircraft taking off, and there was a noticeable change in mood when the venue put on some background music late in the afternoon. The volume of conversation in the room suddenly increased and several people left.

All of us have songs that take us back to special times in our lives. The key is ensuring they are not also the sound of customers heading for the door.

www.thesoundagency.com

[email protected]
Follow Mike on Twitter: http://twitter.com/mike
southon
More columns at www.ft.com/mikesouthon

Copyright The Financial Times Limited 2010.

ST: SIA icon should stay

Think

Home > Think > Story

Oct 10, 2010

EDITORIAL

SIA icon should stay

 

Singapore Airlines has been consistently voted the best airline in the world by a number of travel and business magazines. It is indubitably Singapore's flagship. Part of the company's success must be attributed to the Singapore Girl. She is an icon recognisable worldwide: slim, attractive - and young. SIA stewardesses can work a maximum of only three five-year terms, which means they typically have to retire before they are 40. They also have to resign when they are pregnant, although in recent years, the airline has a Returning Mothers Scheme, which allows cabin crew who quit to have children to rejoin the company. But those who apply to rejoin have to pass an interview and attend a refresher course. It is almost like starting all over again. SIA stewards, on the other hand, can work till they are 57 years old.

Time and again, SIA's portrayal of the Singapore Girl in advertisements has been called sexist and demeaning to Singapore women by women's groups and those more exposed to Western cultural norms. But the formula has proven to be very successful, and there is no reason for the airline to abandon it. Lately, there have been calls to allow the stewardesses to work as long as their male counterparts. SIA should stand its ground. It is not as if the stewardesses do not know when they sign up that being Singapore Girls is not a lifetime contract. In any case, as the nature of the economy changes, more jobs will be on a contract basis.

What the airline must do though is give ex-gratia payment in lieu of maternal leave to pregnant stewardesses who have to quit. It has said that it is in the 'advanced stages' of considering such a payment. It must also be recognised that the Singapore Girl is not an icon in perpetuity, and as values change, which they must, the company should make the necessary changes as quickly as possible. In the meantime, Singapore Girl - slim, attractive and young - will have to stay as SIA's icon.

FT: Words to describe the glory of Apple

Words to describe the glory of Apple

By Lucy Kellaway

Published: September 19 2010 19:26 | Last updated: September 19 2010 19:26

Like most Brits, I find success in others pretty hard to cope with. When that success is  combined with good looks, I can’t tolerate it at all.

Apple’s continued glory eats away at me like a maggot at my core. I long for it to pick up some bruises. When the iPad came out, I prayed that it would be awful. My prayers were not heard: like all Apple products, it is sleek and gorgeous, and in due course I shall go to one of its wondrous temples of consumption and grumpily buy one.

EDITOR’S CHOICE

Lucy Kellaway: CEOs cry all the way to the bank - Sep-12

Lucy Kellaway: Personal life invasion - Aug-29

Lucy Kellaway: Lust and liquor at work - Aug-15

Lucy Kellaway: Leaders in drivel - Aug-01

Lucy Kellaway: Dud is key to office harmony - Jul-18

Lucy Kellaway: Don’t just dress down on Fridays - Jul-04

Now I find that Apple has succeeded in an area even more revolutionary than designing beautiful products that are easy to use. This time, though, I feel no discomfort. Apple has discovered something that other companies have long forgotten, if they ever knew: language can also be beautiful and easy to use. Words can be fun to read. They can look elegant. They can make you laugh.

Earlier this month it published a set of guidelines for apps sold at its App Store. According to the laws that govern this sort of thing, this document should have been doubly unreadable. It was a list of legal requirements and was aimed at techies. Instead, it was funny and clear, and I found myself reading it effortlessly, even though I barely know what an “app” is.

“We have over 250,000 apps in the App Store. We don’t need any more Fart apps. If your app doesn’t do something useful or provide some form of lasting entertainment, it may not be accepted.”

The tone is direct, comic and elegantly threatening.

“We will reject apps for any content or behaviour that we believe is over the line. What line, you ask? Well, as a Supreme Court Justice once said, I’ll know it when I see it. And we think that you will also know it when you cross it.”

Now compare this to the standard stuff on the Microsoft website. The brand new browser, it says, “delivers a richer, faster, and more business-ready Web experience. Architected to run HTML 5, the beta enables developers to utilise standardised mark-up language across multiple browsers”. Well I never. Reading this, I’m bored and restless, irritated and alienated.

Given the towering superiority of the first linguistic style over the second, will it catch on? Will other companies copy Apple’s language just as they have copied its design?

You might think so. You might think there was a clear commercial advantage to be had in writing clearly and stylishly. But you would be wrong. There is no sign that Microsoft has been suffering from its stolid, dodgy way with words. Indeed it is one of the great mysteries of capitalism that there is no invisible hand that joins good language and good profits. If anything, the hand pushes the two apart.

Even in industries that make their money by selling messages there is no appetite for clarity. Just last week a reader sent me the following sentence from the blog of Bob Jeffrey, the head of JWT, in which he describes what his vast and successful advertising agency does: “Global consumers are rapidly re-evaluating and readjusting their value paradigms and purchasing decisions. Our job is to keep our ear to the ground with these consumers, providing relevant real-time insight to our clients that inspires cutting-edge, cost-efficient solutions.”

The Apple version of this would be something like: “Consumers can change so we try to keep up.” This version reads better, but it is not hard to see why Mr Jeffrey didn’t put it that way. “A relevant real-time insight” sounds like something that a befuddled client might pay more money for.

An even better example of the link between high profits and low language was on the appointments pages in the Financial Times 10 days ago. It was an advertisement from “one of the largest and most trusted banking and financial services organisations in the world” which was hoping to hire a “customer journey re-engineering manager”.

This title contains three layers of obfuscation: the ludicrous yet ubiquitous idea that a banking customer is on a journey; the idea that this journey needs re-engineering; the notion that this needs managing. There is only one conclusion to be drawn: surplus profits generate bonuses and bullshit in equal measure.

The only customers who are really on a journey are those of the transport sector. And as I looked at a collection of them chugging along into Moorgate station last week I thought of another reason why Apple’s brave effort to rehabilitate language won’t catch on. Words are finished. Customers on journeys don’t read. They watch videos on their iPads, iPhones and iPods.

[email protected]

Copyright The Financial Times Limited 2010.

FT: Why we're all marketers now

Why we’re all marketers now

By Peter York

Published: August 28 2010 00:23 | Last updated: August 28 2010 00:23

I’m in marketing,” a woman who looked startlingly like Catherine Tate’s office-worker sociopath character told me proudly on the Blue Train to Portsmouth Harbour. I hadn’t got her down as marketing director of Selfridges or Channel 4, but she could have worked in a promotional agency in Bournemouth at a pinch. As it turned out, she did data-inputting for one of the statistics warehouses that serve retail trade analysts. She could have done exactly the same job in McDonald’s offices or an NHS records department, but the tenuous link with the world of television commercials and rock festival sponsors clearly struck her as exciting.

EDITOR’S CHOICE

The true value of gold - Aug-28

I’m in marketing too. Sort of. Not that I say it quite like that, for all sorts of complex, pedantic and squeamishly English reasons. What I learnt to do in my first job, working for a high-table-talking Belgravia American in the 1970s, was clever market research – research a world away from the polls and statistics of commodity stuff. Research designed to shape strategies, not quantify the monthly round; the kind of research that was, in the words of one of my employer’s clever essays, “The bastard child of marketing and the behavioural sciences” – motivational research. Our reports were more fancy essays, involving intelligent taxonomies, elaborate conceits and a lot of art references. We wouldn’t have called it marketing then because that generic sailed too close to the cheery, cheesy world of promotions, direct mail and what advertising people called below-the-line; in other words, little better than sales.

When I set up in business with a partner, we described what we did as “research-based strategy”, aligning ourselves with the coming world of management consultancy. We chose not to align ourselves with advertising, the more obviously glamorous front end of marketing. Ad-land seemed a bit rackety. I’d learnt my MR trade before I wrote a word of journalism, but it came in handy, especially the taxonomy part – what we called “market segmentation” – when we described people, what they wanted out of life and how it explained their shoes.

If I wasn’t proud to identify with marketing it wasn’t just for those squeamish English reasons. Back then, thoughtful, liberal people told you that marketing was the devil’s work, an imported American practice and the thin end of a nasty wedge. A raft of middle-brow books – Vance Packard’s The Hidden Persuaders (1957) was the bestseller among them – had described marketing, and especially advertising, as manipulative and dishonest, the advance guard of dumbed-down materialism. Later, of course, the world changed utterly and marketing started to sound cleverer and more directional.

This week, hundreds of marketers – the marketing business’s word for its practitioners – made their way to the first ever Edinburgh International Marketing Festival, held in venues already brimming with cultural creatives and comedians and talent-spotters. Had the marketer from Bournemouth attended her confidence would have been vindicated. The organisers are the marketing establishment – The Institute of Practitioners in Advertising (IPA) and the Marketing Society – in league with a new-generation business called Creative Brief. The audience, of people with titles like marketing director, brand manager, digital comms director, consumer insight wallah, clearly reckoned that if they got away from the sort of workaday conference held in purpose-built hotels in Hounslow (porridge-coloured composite marble floors, velveteen chairs) to somewhere altogether fringeier, funkier and younger – the main venue was the city’s Assembly Rooms, incubator of all those famous stand-up careers – they’d be able to debate what they’re about more freely.

This is a difficult moment for marketers. Market Leader, the Marketing Society’s clever, literate journal, has been debating in recent issues whether the internet has changed absolutely everything in their world, or just most of it. Judie Lannon, its editor and a former planner at J Walter Thompson, says: “Marketers get distracted by the accountability pressures, all the New Age agencies that report to them and all the online one-hit wonders they have to understand.”

The festival programme was packed with debates and talks about the internet, about social responsibility, about the environment and the future of the human race; and what shall we do about the recession? The combination of the credit crunch and the internet has been disastrous for a range of traditional advertiser-supported media – particularly newspapers and television, the pillars of the postwar marketing landscape. Until recently, big league marketers worked on the assumption that whatever else they did, they could reach mass audiences predictably and regularly through a stable media universe of print and electronics, newspapers and magazines, radio and television. They knew the environments for their messages, the precise way they would be delivered, the profile of their audience, because it had all been researched to death.

In the 1980s, for a blissful decade or so, marketing seemed set to run the show – the government, UK plc, the lot. Saatchi & Saatchi was a fast-growing FTSE100 company; British television advertising, the most familiar face of marketing, was on a roll, popular with the (still huge) audiences for terrestrial television, and admired internationally. Headhunters were even saying that with a bit of training and conventional tailoring, the top marketers could form the next cohort of chief executives. But all those certainties have gone, replaced by a more confusing world of fragmented, “long tail” markets and demanding, disloyal, “brand me” consumers.

The problem for capital-M marketing people is that we’re all marketers now. The language, the ideas, the mindset of marketing have become part of everyday discourse. These days, if the marketers aren’t on the board themselves, people with what the bestselling US business writer and Harvard professor Theodore Levitt called the marketing imagination are. Back in 1982 Levitt’s The Marketing Imagination defined a way of looking at the world and doing business in it: an instinctive belief that the route to growth and profit lay in looking outside the business, understanding and satisfying customers, producing what they wanted, building brands (“beach-heads in the mind”) that would command premiums (higher prices) and loyalty.

The people who told me to speak English back then when I came out with my marketing-speak patter – the would-be literary novelists, contemporary artists or radical barristers – all use it now. They describe things as “up-” or “downmarket”; they talk about “target markets” and “branding” of charities, theatres and countries. They discuss “segmentation” and “demographics”, “profile” and “penetration”. Above all, they go on about “getting some PR” – often for themselves.

The great irony – the pyrrhic victory – of marketing is that while it’s having its moment of doubt, its ideas and language seem practically to have conquered the world. The core intellectual precepts of marketing, such as customer focus (being dedicated to customers for life) and brand-building (making the brand central to everything the company does) and consultation (constantly sounding out how people in your market think, feel and behave and feeding it back into everything you do), have become part of life not just in business but in the public sector and the non-profit world of institutions and charities, as well as in personal life.

Since the 1980s, the public and voluntary sectors have adopted marketing practices. They, too, became customer- and client-facing, they researched and PR-ed and sought partnerships with big-brand sponsors. And the bigger ones advertised, too, to raise awareness and funds.

In the 1990s, departments of state and good works quangos developed something called “social marketing”, using the toolkit of marketing to achieve good behavioural changes – all those Don’ts and Stops, for everything from drunk-driving to taking drugs to eating too much. Every big-spending government department has marketing-literate people in it now, often high-fliers hired from the private sector. And there’s a covert consensus in the political centre ground that they’re as much part of the modern world as being digital; they’re necessary, uncontroversial – even democratic. Greater Good: How Good Marketing Makes For Better Democracy (2008), co-written by John Quelch, a Harvard Business School professor, represents the zenith of this sort of argument. And although the Coalition has cut government advertising by half, it has also set up a Downing Street “nudge” unit, the Behavioural Insight Team.

In the 21st century, marketing has come home to individuals. The move to a “Me Inc” approach of “personal branding”, the growing “how do I look?” obsession, massaging your presentation to the world through your Google entry and social media presence, your blogs and tweets and personal websites, all derive from marketing. It’s what Norman Mailer referred to ironically as “Advertisements For Myself” in his 1959 collection of show-off essays of that name, but it’s not ironic now, for literary intellectuals or anyone else.

Of course marketing has more to be proud of than its total penetration of establishment thinking and language. There’s always been a close relationship, bordering on the symbiotic, between marketing and the arts. The exchange between the two is as apparent in Millais’ Pears Soap “Bubbles” and the bottle of Bass in Manet’s bar at the Folies-Bergères in the 1880s as the moment in the 1960s when advertising seemed practically to have merged with contemporary art: pop art took themes from the ad world, product packaging and commercial pop-culture, and smart advertising took them back. Advertising creatives were forever loping around galleries, goofing off to experimental film festivals, listening to new music, relentlessly talent-spotting, looking for the tricks and the tropes that would differentiate their clients’ brands.

In his The Conquest of Cool (1997), the left-leaning US political commentator Thomas Frank says that Madison Avenue practically invented the 1960s cultural youthquake, rather than just buying it out. Of course a cohort of writers and film directors, from Fay Weldon and Salman Rushdie to David Puttnam, Alan Parker, Ridley Scott and Tony Kaye, started out in advertising.

Today, beset by the new media landscape and post-crunch capitalism, the people who gave us what we wanted are having one of their funny turns. The period gorgeousness of TV’s Mad Men world, the kitschy interest in the plastic roses Daz gave away in the 1960s, the big sweep of big brands, big ideas and big budgets, can all look so dangerously retro, fragmented by the 2010 agenda.

But marketing men and women need to keep their nerve, raise their eyes back up to the hills; if we’re entering a brave new world of marketing, it’s one obviously saturated by the language of the industry. It’s a world where the quintessential scenario of 21st-century self-branding, the digital equivalent of the old 30-second television commercials, is your very own YouTube series (“My Gorgeous Life and Friends”, “My Struggle with Braces”, “My Diet” – all chances to talk about Me).

Marketers, you’ve won. It may not look exactly like that as you work out whether the anarchic-looking world of viral marketing, social media and YouTube can possibly yield anything like the neat schedules and steady returns of the golden age. But you have to remember that your company, your institution and your country really need you.

When discredited financial engineering and the last decade’s gunboat diplomacy have run their course, when the exciting new technologies have begun to sour, those people who can listen well and talk compellingly inside and outside the organisation – whatever it does – those who believe in organic business growth, can take over once again and do what the Harvard international relations specialist Joseph Nye famously calls “soft power” on the side of the angels.

Peter York is chairman of SRU

..................................................

‘The internet is both too big and too small’

Facebook’s founder Mark Zuckerberg

For much of the last decade, the internet has posed a troubling conundrum for advertisers and marketers: it is both too big and too small, writes Tim Bradshaw.

Google indexes more than a trillion web addresses, each with its own miniature fan-base. To an industry weaned on the US Super Bowl and soap-opera ad breaks, guaranteed to draw millions of viewers to one place, that’s a mind-boggling mass of media to deal with.

As most people’s starting point in navigating the internet, search engines have so far attracted the lion’s share of online advertising. But sponsored links on Google are a far cry from a 30-second TV slot. Search ads are successful because they are “high intent”: consumers are often in buying mode when they search for, say, a digital camera, and are therefore inclined to click on the adverts. But what about the marketing that makes them want to buy a new camera in the first place?

Traditional media has remained the more popular way to build awareness of a brand or product, but the social networks that have emerged to dominate web activity in the past couple of years want to change that by combining the scale of TV and billboards with the precision and “engagement” of the internet.

Facebook, the most successful of them, has 500m active members around the world, half of whom log in every day, spending a total of 700bn minutes a month on the site. In March, Facebook overtook Google as the most popular website in the US, according to Experian Hitwise. Although its revenues are still dwarfed by Google’s, Facebook is expected to exceed $1bn in revenue this year, almost all from advertising.

Beyond simply buying adverts, marketers have another interest in social sites – the prospect of free, word-of-mouth publicity. For anyone clever enough to control this viral marketing and cajole active users into spreading a message through their personal networks, the rewards are enormous.

Tim Bradshaw is the FT’s digital media correspondent

Copyright The Financial Times Limited 2010.

FT: Navigating cultural differences

Navigating cultural differences

By Emma Jacobs

Published: July 19 2010 23:07 | Last updated: July 19 2010 23:07

HSBC is backing a show (above) by Brazil’s Ernest Neto to highlight its local knowledge

EDITOR’S CHOICE

Success on the mommy track - Jul-06

Where organic food is new and ancient - Jun-03

More than just an investor - May-10

Idiosyncratic master of the revels - May-04

A high-speed empire builder - Apr-27

Fresh waters for entrepreneurs - Apr-25

Walking through a labyrinthine tunnel apparently made of purple, lime and yellow-coloured ights may not be an obvious route to boosting a bank’s profits. But HSBC hopes its sponsorship of an exhibition by Brazilian artist Ernesto Neto in London may help to do just that.

The bank, known for its “world’s local bank” slogan, has backed this summer’s Festival Brazil, a programme of cultural activities at London’s South Bank Centre celebrating the country that is predicted to be the world’s fifth-largest economy by 2025. Marah Winn-Moon, HSBC’s global head of cultural sponsorship, says such events are integral to a strategy that posits understanding different cultures as key to developing successful business relations. “Individual consumers might see Brazil from a different perspective and break down stereotypes about Brazil, not just being about carnival. They might work for an SME and HSBC might provide an entry point for operating in Brazil,” she says.

David Kotheimer, deputy chief executive of HSBC Brazil , an American who worked in London before moving to São Paolo last year, believes the festival helps business. “Understanding the creativity in the culture, you get a sense of the country and that helps spot opportunities to expand the bank’s business,” he says.

Colin Tweedy, chief executive of Arts & Business, a UK body that encourages private investment in the arts, sees this as “cultural diplomacy”, which he describes as “extending the company’s brand into a foreign market”. Such marketing strategies are only effective, he says, if the companies are prepared to work at “getting people, including foreign journalists and trade emissaries, to engage with these events”.

HSBC, for example, is also involved in a parallel programme of business seminars and conferences about operating in Brazil, including a research project with The Economist, conferences with the Financial Times and a publication with Time Out magazine.

Celebration of a country’s difference runs counter to the notion that the world is becoming culturally homogenised through the spread of the internet, the internationalisation of business and the development of a cadre of high-flying MBAs that appear to speak the same business language.

Such a belief can fool managers into believing cultural differences do not matter, according to Paul Bennett, chief creative officer and managing partner at Ideo, a global innovation and design consultancy. In fact, he says, global companies must understand different cultures and turn that to business advantage: “It’s the understanding of the subtleties that are important.”

As Maarten Nijhoff Asser, consultant at Trompenaars Hampden-Turner, which advises companies on cross-cultural challenges, says: “If your strategy is just growth without thinking about adapting to local markets, then you are just the Royal Bank of Scotland and you will falter. Too many companies don’t listen. It can be long-winded, but it is ultimately more successful.”

All companies, says Andrew Kakab­adse, professor of international management development at Cranfield School of Management, have done localisation “badly at some point”. The key to making it work is “clarity of strategy”, which is formed “when a company interrogates itself about what it’s really good at”, he says.

One global brand that has adapted to local tastes is fast-food chain McDonald’s. From the beginning of its development in the US, to its spread in Europe and, more recently, India and China, the company has targeted a variety of products at consumers in different markets.

Catering to local taste

Starbucks, the coffeeshop chain born in Seattle that has become one of the world’s most ubiquitous brands, has had to grapple with the challenge of projecting a core identity while also adapting to local markets.

At first, the chain traded on its all-American image. Outlets and food offerings were fundamentally the same, whether in Singapore or San Francisco. Now, however, the company is tweaking this strategy. It has decided that it must subtly tailor its offerings to local tastes.

In the UK, for example, it now sells the “flat white”, a strong espresso-based coffee drink that originated in Australia and New Zealand and only arrived in Britain about a decade ago.

Similarly, some of its cafés are being tailored to their local environment. A branch in Knightsbridge includes one-off art pieces, as befits one of London’s more affluent areas and a royal borough.

The company hopes the strategy will help it reconnect with local communities after a period during which, it now says, it expanded too quickly and suffered reputational damage.

The trick, however, will be to do so while also retaining its strong American image.

Key to its successful localisation have been research and investment in products adapted to local tastes.

Big Macs were never going to succeed in India, where 80 per cent of people do not eat beef. But the company did not treat the country as a single market, and conducted in-depth analysis in several states. So, when McDonald’s opened a restaurant in Gujarat, where most citizens are vegetarian, it offered vegetarian burgers and other Indian dishes, such as samosas. In New Delhi, however, McDonald’s introduced meat burgers for non-beef eaters – such as the Maharaja Mac with lamb or chicken.

The company has also made an effort to recruit local managers, for example establishing joint ventures with two local entrepreneurs in New Delhi who were selected to manage the fast-food restaurant. According to a 2007 article in the Journal of Business Case Studies by Bahaudin Mujtaba and Bina Patel, of Nova Southeastern University, this strategic move helped the company negotiate Indian bureaucracy.

Not all overseas managers need to be local recruits. But Mr Bennett says that when staff are sent overseas they need to become immersed in the local culture. He cites the example of one employee who moved to Shanghai and cycled to work instead of having a driver. “Relocation can be like dropping people from the sky so that they lead from above rather than becoming part of the community you need them to sell to,” he says.

Increasingly, this process is also taking place in reverse, with companies from the growing Bric economies expanding overseas. “It used to be that it was western companies growing in new markets – now it is the likes of Tata, Lenovo and Mahindra that are expanding overseas,” says Mr Nijhoff Asser.

The reasons why many companies expand overseas are changing. He adds that there was a time when “companies went overseas for costs [of production]” or to reach new markets, “but now they are going there to find innovation in the local market”.

Last year, Vijay Govindarajan and Chris Trimble of the Tuck School of Business co-authored an article with Jeffrey Immelt, chief executive of General Electric, in Harvard Business Review on “reverse innovation”, a process whereby goods developed as inexpensive models to meet the needs of emerging markets are repackaged as low-cost products for western consumers.

Prof Kakabadse says this is a reversal of the old strategy of “think global, act local”. Now, it is “think local, then act global”. So, rather than companies customising products to a local market, the focus should be to start with the local products and then try to leverage them globally.

But not all global companies need to adapt to different cultures. Apple sells the same iPad in Tokyo as in Toronto. Rather than localisation, it competes on pace of innovation, says Mr Nijhoff Asser. “HSBC, Ryanair and Apple’s top teams have asked themselves what makes their companies better than anyone else. HSBC looked at its 19th-century origins when it was operating in Hong Kong and Shanghai and serviced the local needs,” he says.

But, he adds, Ryanair does not worry about adapting its product to local markets. Its competitiveness lies in price: “Whether you decide to differentiate your market is entirely dependent on your product.”

Copyright The Financial Times Limited 2010.