Category: Effectiveness

Marketing crack: Kicking the habit

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“We’ve created a gambling culture in which we tune out everything except the most immediate outcomes.”

Laurence Fink, Chairman and CEO, BlackRock

“Addiction is a pathological attachment to something attractive in the short term, but destructive over time. Recovery is about looking where we’re going and choosing a path that can last.”

Dr. Chris Johnstone, addiction specialist

IMPATIENT TIMES

Would you rather receive $100 today or $125 a year from now? Although a 25% increase is an excellent one-year return on investment, the average decision-maker would choose the smaller immediate gain rather than the larger future gain.

This tendency to discount the value of future gains is what psychologists call “temporal discounting” and what economists term “rates of time preference.” It’s what you and I would call patience. And we live in impatient times.

The short-termism of the corporation has been well-documented:

While typically, between 70 and 90 percent of a company’s value is related to cash flow expected three or more years out, management tends to be preoccupied with what’s reported three months from now. And as Dominic Barton of McKinsey observes, “If the vast majority of most firms’ value depends on results more than three years from now, but management is preoccupied with what’s reportable three months from now, then capitalism has a problem.”

In the UK and US, cash-flows 5 years ahead are discounted at rates more appropriate 8 or more years hence; 10 year ahead cash-flows are valued as if 16 or more years ahead; and cash-flows more than 30 years ahead are scarcely valued at all.

In 1995, the mean duration of departing CEOs from the world’s largest 2,500 companies was just under 10 yrs. By 2009, it had fallen to around 6 years.

In the 1960s, 40% of US corporate earnings and borrowing used to go into investment. By the 1980s, that had fallen to 10%.

S&P companies spend 95% of their profits on share buy backs and dividends – $914 billion – rather than on long-term investment

Between 2004 and 2013, $3.4 trillion was spent on share buy backs at the expense of long-term investment

The long is, as Andrew Haldane, Chief Economist and the Executive Director of Monetary Analysis and Statistics at the Bank of England has put it, is short.

We can hold the gospel of shareholder value responsible for much of the short-termism that plagues so much of capitalism. First espoused by Milton Friedman in 1970 it holds that the singular goal of a company should be to maximize the return to shareholders. But in placing shareholder value before everything else, it encourages corporations and their management to focus on increasing the stock price, while doing little to encourage long-term investment.

To this, we’ve added the fuel of turbocharged data.

Information – and with it our capacity to acquire, disseminate, and respond to it – continues to accelerate at dizzying rate. Moore’s Law continues to make its rampage through our times, rewiring lives, markets, business, and expectations. It compresses everything it touches – distance, time, the feedback loop of the marketplace, our boredom threshold, our capacity for patience.

Consider that while news of Nelson’s victory in 1805 at the Battle of Trafalgar took 17 days to reach London (2.7mph), news of the Sichuan earthquake in 2008 took just 1 minute reach London (204,000mph).

Or that the average tenure of Premiership football managers has fallen by one month per year since 1994. If this trend continues, it will fall below one season by 2020.

Or that we’ve come to expect things so quickly that we can’t wait more than a few seconds for a video to load. Analysis of the viewing habits of 6.7 million internet users has revealed that after 2 seconds people start abandoning. After five seconds, the abandonment rate is 25 percent. When you get to 10 seconds, half are gone.

As the novelist and cultural observer Douglas Rushkoff has recently argued, immediacy is more and more the central defining characteristic of our culture:

Our society has reorientated itself to the present moment. Everything is live, real time, and always-on. It’s not a mere speeding up… It’s more of a diminishment of anything that isn’t happening right now. So much so that we are beginning to dismiss anything that is not happening right now – and the onslaught of everything that supposedly is.”

The forces that are transforming culture and capitalism run through our business too. For as capital and management have become increasingly impatient, we have inevitably (and in large part unwittingly) become both slave to and enabler of their agenda and rate of “time preference”.

We too have reorientated ourselves to the present moment.

CHASING SHORT-TERM METRICS

Digital interactions have brought us a wealth of new data.  The lure of this data is not only that is it immediately available, but that much of is highly responsive to marketing activity. 

Under pressure to account for our activities and to show that they are having an effect (any effect) and hooked on the crack cocaine of the short-term, we seize on intermediate metrics such as likes, views, tweets, shares and so on, like crazed junkies desperate for the next fix.

This data might be exciting, it might be highly responsive to communications activity, it might be easy to measure, and it might give us impressive sounding numbers to use in case study videos, but it is short-term data that tells us nothing about the long-term business effects of our efforts.

Worse, our holding up of short-term metrics that simply measure the exposure of consumers to our ideas as evidence of our success relegates our contribution to the mere distribution of content. And so – such is our appetite for evidence that something happened in the short-term – we relentlessly conspire to render the creation of enduring ideas, the building of memories, the shaping of perceptions, preferences, and behaviours a trivial side-show. The very things which that are the source of our value as an industry, and the generators of sustainable value for brands and businesses. 

The short-term is invariably easier to manage and measure than the long-term. Yet as Binet and Field cautioned in their first round of analysis based upon the IPA’s DataBank what is important, and what is easy to measure, are not always the same thing. We forget the distinction between the important and the easy at our peril.

INCREASINGLY FIXATED WITH DEMAND FULFILMENT

Such is the gravitational pull of the short-term that we can stand idly by, mute, uncomprehending, or complicit, when we’re told that the future lies in ever tighter targeting and the pursuit of ever greater relevance.

Central to the promise of programmatic media buying is greater efficiency through improved relevance – getting the right content in front of the right person. But it carries risks in equal measure to its rewards. The co-author of the celebrated Cluetrain Mainfesto Doc Searls unwittingly articulates the dangers of blindly pursuing efficiency and hyper-relevance perfectly: “The Intention Economy grows around buyers, not sellers. It leverages the simple fact that buyers are the first source of money, and that they come ready-made.”

Of course the better targeted any marketing programme is, the higher the response rate. The gain in efficiency comes from not trying to sell things to people who aren’t interested. Thus as one agency puts it: “with this type of automated advertising, you know your ad impressions will only be used on certain people who are already interested in your product or service.”

But once again we conflate effectiveness and efficiency. Response rates are proportional, as the marketing scientist Byron Sharp reminds us, and don’t say anything about total effect size. A 50% response from targeting 100 people  after all, is less than a 10% response from mailing to 1000 people. 

Tighter targeting delivers higher response rates, but the pursuit of efficiency cannot be allowed to drive out the pursuit of effectiveness.

Nor can the visibility of consumer interest and intent to the marketer allow us to shrink our horizons, and relocate our contribution down to the very last step in the path to purchase. The insistence that the task of modern marketing is demand fulfilment amongst the already interested is to give up on the very idea of brand-building.

FAILING TO CELEBRATE LONG-TERM BUILDERS

There is perhaps no better barometer of our industry than what we choose to reward. And here the evidence is telling. Aside from effectiveness awards, there is no forum which celebrates the brand-building work of sustained creativity and succeeds in attracting both clients and creative agencies.

The Cannes Effectiveness Lion is a notable and welcome exception to this. But it proves the rule that – as John Hegarty noted at last year’s Cannes Lions Festival – creative awards are inherently about creative innovation.

Small wonder that that creatives juries are biased against work that forms part of a long-running campaign. It’s just “not new’.

RECOVERING OUR PURPOSE

As Lawrence Green has put it, this is marketing mission drift, “from an art practised for the longer-term health of a brand and business, to a science lopsidedly focused on the short term.”

It is addiction – a pathological attachment to something attractive in the short term, but destructive over time.

Adland is in much need of a reformation, and our first step to recovery should be to remind ourselves that brand-building is by its very nature, a long term business.

That would might seem to be so self-evident as to be redundant, and yet some extraordinarily misguided, inaccurate (or plain self-serving) claims for how advertising works continue to be peddled.

This, for example, is how some (otherwise respectable) folk have represented advertising – as a being fundamentally activity that only has a short-term effect:

charts.001

Respectable or not, this is bullshit.

The fact of the matter is that most advertising simply does not pay back in the short term. And a succession of short-term effect activation or promotional effects will invariably fall far short of the gain that comes from pursuing long-term effects.

The effect is not just the driving up of volume or share, but pricing improvements. And as the analysis undertaken by Les Binet and Peter Field of thirty years’ of IPA Effectiveness Awards data demonstrates, the most profitable of all campaigns are those that drive both incremental volume and the strengthening of margins. And since pricing effects are slower to crystallise than volume effects this takes time.

So this is what long-term brand-building actually looks like: 

CHART > LONG TERM EFFECT.001

Over time, baselines sales (i.e the volume that is bought at full, not discounted price) are – along with pricing – nudged upwards.

And the means by which this is accomplished is through the intangible, the stirring of emotions, the creation and nurturing of what Bryon Sharp terms memory structures, what Judith Williamson called “empires of the mind”, and most of us would call brand-building.

This is not to argue that the short-term does not matter at all. After all there can be no ‘tomorrow’ for a business if there is no ‘today’. As Jack Welch, the former CEO of GE has said, “the job of a leader and his or her team is to deliver to commitments in the short term while investing in the long-term health of the business”. Brands do need to direct some of their investment towards short-term activations that leverage the brand’s equity and produce short-term sales while the brand builds momentum.

But the short-term cannot be the focus or priority.

For it is the curve that ultimately matters, not the blip.

***

A PATH THAT CAN LAST

We are an industry in the grip of an existential crisis, looking over with confusion at the powerhouse players in adjacent industries, and envying their apparent confidence and their power to disrupt. So I hesitate to suggest that we might look to others to remind us what we are about, for a new metaphor to create by, and perhaps, and a better standard to hold ourselves account to.

But the platform builders do were to remind us of the value of thinking big and thinking long.

#1 TAKE THE LONG VIEW

Whether it is Google, Facebook, or iPhone, the business of platforms is inherently a long-term one.

Here for example, is Brin and Page’s first ever letter to shareholders in 2004:

As a private company, we have concentrated on the long term, and this has served us well. As a public company, we will do the same. In our opinion, outside pressures too often tempt companies to sacrifice long term opportunities to meet quarterly market expectations… If opportunities arise that might cause us to sacrifice short term results but are in the best long term interest of our shareholders, we will take those opportunities… We recognize that our duty is to advance our shareholders’ interests, and we believe that artificially creating short term target numbers serves our shareholders poorly. We would prefer not to be asked to make such predictions, and if asked we will respectfully decline. A management team distracted by a series of short term targets is as pointless as a dieter stepping on a scale every half hour.”

And as Jeff Bezos remarked in an interview, taking the long view is a source of  competitive advantage:

If everything you do needs to work on a three-year time horizon, then you’re competing against a lot of people. But if you’re willing to invest on a seven-year time horizon, you’re now competing against a fraction of those people, because very few companies are willing to do that.”

The achievements of Sir Alex Ferguson, the manager of Manchester United from 1986 to 2013 show this in action.

The hallmark of his management of the club was that he took the long view. As he said in an interview for Harvard Business Review:

The first thought of 99% of newly appointed managers is to make sure they win—to survive. So they bring experienced players in. That’s simply because we’re in a results-driven industry. At some clubs, you need only to lose three games in a row, and you’re fired. In today’s football world, with a new breed of directors and owners, I am not sure any club would have the patience to wait for a manager to build a team over a four-year period. Winning a game is only a short-term gain—you can lose the next game. Building a club brings stability and consistency. You don’t ever want to take your eyes off the first team, but our youth development efforts ended up leading to our many successes in the 1990s and early 2000s. The young players really became the spirit of the club.”

His focus was always on building a successful club (the long view), not just a successful team (the short view).

Ferguson stood down as Manchester United boss at the end of his final season, having won 49 trophies in the most successful managerial career British football has ever known.

#2 EMBRACE  BIG IDEAS

Joseph Jaffe has argued that:

Big ideas take too much time to find and we don’t have the time to find ’em (not on current accountability time). Big ideas are equated to expensive ideas…hence the word BIG. They’re meant to create a splash; secure buzz; enrapture the masses with pomp, grandeur and ceremony. Big ideas are similarly, full of hot air, fluff, inflated with self-importance, exaggeration and hyperbole.”

Oh yes, how much more prudent, agile, spendthrift, modest, humble, properly authentic, and just downright more au courant, to pursue a bunch of small ideas.

Except that you need a big, organising idea if you are to have something to navigate by over the long-term.

If you are to make the most efficient use of the finite resources available.

If you want activity to aggregate its effects.

If you are to have a rich source of inspiration for the long term.

If you are to recruit, galvanise, organise, and focus resources over the long-term.

If you are to have customers keep returning to you over the long-term (and recognize you when they look for you or come across you).

When big gets a bad name (and is often deliberately conflated with scale of production budget), we might want to recall the words of Peter Thiel:

Iteration without a bold plan won’t take you from 0 to 1.”

#3 MAKE AGILITY PURPOSEFUL

The wonderful thing about having a long-term direction is that it makes flexibility and responsiveness possible. As the military historian and management consultant Stephen Bungay puts it:

Strategy is essentially an intent rather than a plan, because the knowledge gap means we cannot plan an outcome but only express the will to achieve it, and the effects gap means that we cannot know for certain what the effects of our actions will be, and that we will probably have to modify our actions to achieve the outcome we want. We can only do that if we are clear about what outcome we desire.”

Laurence Freedman (also a military historian) too, makes the same point in his magnum opus Strategy: A History:

Strategy is much more than a plan. A plan supposes a sequence of events that allows one to move with confidence from one state of affairs to another… Strategy is required when others might frustrate one’s plans because they have different and possibly opposing interests and concerns… The inherent unpredictability of human affairs, due to the chance events as well as the efforts of opponents and the missteps of friends, provides strategy with its challenge and drama… Strategy is often expected to start with a description of a desired end state, but in practice there is rarely an orderly movement to goals set in advance. Instead, the process evolves through a series of states, each one not quite what was anticipated or hoped for, requiring a reappraisal and modification of the original strategy, including ultimate objectives.”

Because they can distinguish between plans and strategy, they’re able to focus on the long-term game, and be able to respond to events and circumstances at the same time.

Facebook’s self-declared mission (aka big idea) is “to give people the power to share and make the world more open and connected” gave it the flexibility to modify its actions, and start building value on what it had previously ignored. The one digital device set to dominate them all, namely mobile.

Much has being said and written about the need for corporations and marketers to increase the tempo of their efforts. That Facebook now makes 69% of its revenue from mobile illustrates the other advantage of long-term strategy. It makes speed purposeful. As Lawrence Green has sagely noted:

The faster you are going to execute, the more precise and commonly understood your direction of travel must be. Pace is only an asset, warned Arsene Wenger as he introduced Theo Walcott, if you know where to run. Hold the great Frenchman’s thoughts in mind as your answer the ever more urgent call to seize the day, to answer to now.”

#4 EXTRACT MAXIMUM VALUE FROM YOUR PLATFORM

Not everything of course is as malleable as software. If you’re running a business that is dependent on tangible assets and infrastructure, then ‘pivoting’ is probably going to be a far more challenging affair than if you’re running a business that’s built on lines of code.

However, what does characterise the successful platform builders is that they don’t change the platform every two years.

But they do build new things on it.

For example, booking.com’s boookingnow app represents another way of delivering the perfect accommodation solution – ‘the delight of right’ – to late or spontaneous bookers, making their arrangements on their phone. But the platform mission of delivery more delight of right moments to more travellers remains.

Rather than change the platform every three years, we’d be better off building new things on it.

#5 BUILD A PLATFORM OTHERS WANT TO BUILD UPON

Which brings me on to the next point. Many modern platforms are all about making themselves available for external application development.

The iPhone for example, would not be the generating the $47 billion it did in 2011 without the apps that have been created for it. From Facebook to Angry Birds, Uber to Candy Crush these have created immense value for Apple that they never would have realized on their own.

Opened last year, Nike’s Nike+ Fuellab is a collaborative work and testing space for selected partner companies to develop products that integrate the NikeFuel system for tracking and measuring activity.

Platforms provide the infrastructure others can create upon to build value.

And good brand platforms are little different.

The opportunity provided for example, by Old Spice’s Smell Like a Man platform has ensured that creatives clamour to work on the P&G business.

This isn’t an argument for selfish creative indulgence.

Brand platforms must be sustained over the long-term, so the importance of ensuring that creative minds (of all kinds) can sustain their creativity and enthusiasm over the long term cannot be underestimated.

#6 BUILD AROUND THE NEEDS OF PEOPLE

If the new adjacent industries, and their digital products, services and platforms do anything, it is to remind us to build around the needs of the user/customer/consumer. As Peter Thiel argues “The best entrepreneurs know this: every great business is built around a secret that’s hidden from the outside. A great company is a conspiracy to change the world”.  And the best way to find secrets, is to look for the unsolved and unanswered problems in people’s lives.

It is time we all got back to properly building long term sustainable futures for our client businesses and brands – and time that businesses as Giles Hedger has put it, “seek to grow in step with human development not in an accelerated parallel universe.” This shift, Dominic Barton argues, is not just about managing for the long-term and how we manage and lead corporations. It’s also about changing what we believe is a business’s value and role in society.

Writing for Forbes, Steve Denning surveys the unforeseen consequences of the narrow and relentless pursuit of shareholder value:

Endemic short-termism

Combines of executives and shareholder

Executive cronyism

Widespread stock price manipulation

The undermining organisations, communities and whole industries

Dispirited employees

A failure to renew human capital

Short-changed customers

Obsolete management practices

Economic stagnation

International uncompetitiveness

Rampant income inequality

An unhealthy concentration of economic power

Successive economic crashes

An unhealthy concentration of economic power

And a corrupted society

The voices calling for a reformation of the corporation, a rethinking of its priorities, and an end to the the myopic pursuit of shareholder value above all else are impressive. And growing.

Vinci Group Chairman and CEO Xavier Huillard has called the  idea of maximising shareholder value “totally idiotic.”

Alibaba CEO Jack Ma has said that “customers are number one; employees are number two and shareholders are number three.”

Paul Polman, CEO of Unilever has denounced “the cult of shareholder value.”

John Mackey at Whole Foods has condemned businesses that “view their purpose as profit maximization and treat all participants in the system as means to that end.”

Marc Benioff, Chairman and CEO of Salesforce has declared in an article in the Huffington Post that “the business of business isn’t just about creating profits for shareholders – it’s also about improving the state of the world and driving stakeholder value.”

And Tim Cook, CEO of Apple when asked to disclose the costs of Apple’s energy sustainability programs, and make a commitment to doing only those things that were profitable, replied, “When we work on making our devices accessible by the blind,” he said, “I don’t consider the bloody ROI.” It was the same thing for environmental issues, worker safety, and other areas that don’t have an immediate profit. The company does “a lot of things for reasons besides profit motive. We want to leave the world better than we found it.”

Roger Martin dean of the Rotman School of Management at the University of Toronto, contrasts the agenda of shareholder capitalism and its focus on investor expectations, with the agenda of consumer capitalism, in which real factories are built, real products produced, real revenues are earned, and real dollars of profit show up on the bottom line:

The difference in outcomes between a real-market focused world and an expectation-market dominated world is stark and critically important for the economy. When the real market is dominant, customers are the focus and the central task of companies is to find ever better ways of serving them… When the expectations market is dominant, traders are the focus and gaming markets is the task…. the expectations game is beginning  to destroy the real game, slowly from within… Companies should place customers at the centre of the firm and focus on delighting them, while earning an acceptable return for shareholders.”

As those charged with understanding the real, day to day lives, needs and wants of ordinary people, we in the marketing community have a unique and privileged perspective that the majority of those in the C-suite  – far, far removed from the lives, concerns, dreams, struggles, aspirations and joys of the 99% – are not privy to. And we should recognise that with this perspective comes a responsibility.

We should be lending our voice in calling for a wholesale reformation of the corporation, for a refocusing of our efforts on long-term value creation not short-term value extraction, and for building long-term sustainable futures around the needs of the customer. 

***

“The untutored savage, like the child” wrote the nineteenth century economist William Jevons, “is wholly occupied with the pleasures and troubles of the moment; the morrow is dimly felt; the limit of his horizon is but a few days off.”

It’s time for a shift in our priorities.

In our perspectives.

In what we value.

And in what we build.

It’s time we all grew up.

***

This is the long copy version of a presentation given at the 2015 FutureFlash conference. My thanks to the gang at Contagious for the opportunity to participate, and to Canada’s Institute of Communications Agencies for being such welcoming hosts as well as a great audience.

***

SOURCES

Dominic Barton, ‘Capitalism for the long term’, Harvard Business Review, March 2011

Les Binet & Peter Field, Marketing in the era of accountability

Les Binet & Peter Field, The Long and the Short of it: Balancing Short and Long-Term Marketing Strategies

Bloomberg Business, ‘S&P 500 companies spend almost all profits on buybacks’, 6 October 2014

Sue Bridewater, ‘End of season football manager statistics for 2013-14

Stephen Bungay, The Art of Action: How Leaders Close the Gaps Between Plans, Actions and Results

Avi Dan, ‘The Kardashian effect: The short-lived client-agency romance’, Forbes, February 29th 2012

Steve Denning, ‘The unanticipated risks of maximizing shareholder value‘, Forbes, 14 October 2014 

Anita Elberse, ‘Ferguson’s forumla’, Harvard Business Review, October 2013

The Economist, ‘The repurchase revolution’, 13 September 2014

Larry Fink, letter sent to Fortune 500 CEOs, 21st March, 2014

Lawrence Freedman, Strategy: A History

Milton Friedman,  ‘The social responsibility of a business is to increase its profits‘, The New York Times Magazine, September 13, 1970

Google, ‘Measure what happens most

Andrew Haldane, The Short Long, 29th Société Universitaire Européene de Recherches Financières Colloquium: New Paradigms in Money and Finance?, Brussels, May 2011

Andrew Haldane, ‘Growing, fast and slow’, speech at University if East Anglia, 17 February 2015

Andrew Haldane, ‘Patience and finance’, speech at Oxford China Business Forum, Beijing, 9 September 2010

Giles Hedger, ‘Marketing in the age of sustainability’, Admap January 2010

Joseph Jaffe, ‘A small idea (death of THE big idea)

The Kay review of UK equity markets and long-term decision making, final report, July 2012

S. Krishnan & R. Sitaraman, ‘Video Stream Quality Impacts Viewer Behavior: Inferring Causality Using Quasi-Experimental Designs

Roger Martin, Fixing The Game: How Runaway Expectations Broke The Economy, And How To get Back To Reality

Roosevelt Institute, ‘The disconnect between corporate borrowing and investment’, 25 February, 2015

Douglas Rushkoff, Present Shock: When Everything Happens Now

strategy&, ‘CEO succession 2000-2009: A decade of convergence and compression’, 25 May 2010

Peter Thiel, Zero to One: Notes on Startups, or How to Build the Future

John Tomlinson, The Culture Of Speed: The Coming Of Immediacy

The Wall Street Journal, ‘CEO tenure, stock gains often go hand-in-hand’, 6 July 2010

Beyond ‘ship and blip’: Why platform thinking is for everybody

signs-of-church-health

I was invited to take part in Campaign’s ‘Adland in Amsterdam’ feature. “Write about anything you want,” they said. This is the slightly longer version. You’ll find all the contributed opinion pieces and a write up of a roundtable discussion with fellow friends and inmates from adland here. My thanks to Suzanne Bidlake and Philip Smith for the opportunity of taking part. 

***

Ours is an age of immediacy. Immediate communications. Immediate information. Immediate feedback. Immediate gratification. And the siren call of the short-term is seemingly inescapable in adland.

In such an environment, advertising could do worse than (re)learn some lessons from the product and platform builders.

***

Now amongst those involved in the development of digital products and solutions, the argument often goes that advertising, is a fire-and-forget solution. While building products and platforms is about building (and iterating) sustainable solutions. Campaigns come and go, platforms are “built to last”.

And indeed within the tiny world of adland, it’s easy to find evidence of a fixation with ‘ship and blip.’

Thanks to the immediate feedback loop of all things digital, our fixation with the short-term has been turbocharged. We ship. And then look for evidence of buzz. We count the views, likes, shares, +1s, pins, comments, tweets, retweets, downloads, links, follows, clicks and buys. And then we move on to the next bright shiny thing.

Our new fixation with so-called ‘real-time marketing’ with its promise of real-time optimisation is going to do nothing to encourage long-term thinking. As the novelist and cultural observer Douglas Rushkoff has argued, immediacy is more and more the central defining characteristic of our culture:

Our society has reorientated itself to the present moment. Everything is live, real time, and always-on. It’s not a mere speeding up… It’s more of a diminishment of anything that isn’t happening right now. So much so that we are beginning to dismiss anything that is not happening right now – and the onslaught of everything that supposedly is.”

Indeed so short is our collective horizon that work that forms part of a long-running campaign struggles to be rewarded by creative juries. They’re just “not new’.

Consider the Cannes Lions Festival. For all its undoubted prestige, it is patently not (with the exception of its recent effectiveness category) a festival of brand building, but of creative innovation.

***

So perhaps the product and platform builders have a point.

Except that those who believe advertising ipso facto to be a ship and blip, fire and forget business, fundamentally misunderstand how advertising creates profit.

For we know that sustainable value is built over the long term.

We know that pricing improvements are more likely to drive profit growth than volume  growth alone.

We know that pricing improvements take longer to effect than volume increases.

We know that the most profitable of all campaigns are those that drive both incremental volume and the strengthening of margins.

And while short term (i.e. temporary) volume effects can be achieved through discount pricing, offers, incentives, incentive, or new product features, we know that longer-term effects such as share growth or reduction of price sensitivity demand creating, sustaining, and strengthening long-term memory structures.

The data from the likes of the IPA’s DataBank is plentiful, and is there for inspection by anybody who cares to look. 

So while some will tell us that campaigns work like this:

 MartinsGraphic_02

We know from the work of Les Binet and Peter Field that effective campaigns actually work like this:

Screen Shot 2014-09-23 at 12.21.07

It is the curve that matters, not the blip.

If we cannot grasp the necessity of long-term thinking to profitable advertising, it is small wonder that agencies should stumble and fail to make the move into the development of products and platforms that have a real, enduring role in people’s lives.

***

So perhaps this suggests that rather than think in terms of campaigns, we should all be thinking more in terms in platforms and products. And perhaps the now-famous words of Jeff Bezos should be the ones we all create by: 

If everything you do needs to work on a three-year time horizon, then you’re competing against a lot of people. But if you’re willing to invest on a seven-year time horizon, you’re now competing against a fraction of those people, because very few companies are willing to do that.”

Thus:

Rather than stop-start-start spurts, we should be thinking of sustained engagement with the consumer.

Rather than looking just for short-term spikes (in buzz, ‘conversation’, and sales), we should be looking for evidence that we’re driving sustained growth.

Rather than simply counting the mute evidence of exposure and interaction, we should be using interaction as an active, on-going source of genuine consumer understanding.

Rather than thinking in terms of temporary audiences that come and go, we should be thinking of accumulating audiences over time.

And rather than thinking of strategy as a one-off event, we should be treating it as something that is continuous. As Lawrence Freedman (Professor of War Studies at King’s College London) writes in his recent magnum opus:

Strategy is much more than a plan. A plan supposes a sequence of events that allows one to move with confidence from one state of affairs to another. Strategy is required when others might frustrate one’s plans because they have different and possibly opposing interests and concerns… The inherent unpredictability of human affairs, due to the chance events as well as the efforts of opponents and the missteps of friends, provides strategy with its challenge and drama. Strategy is often expected to start with a description of a desired end state, but in practice there is rarely an orderly movement to goals set in advance. Instead, the process evolves through a series of states, each one not quite what was anticipated or hoped for, requiring a reappraisal and modification of the original strategy, including ultimate objectives. The picture of strategy… is one that is fluid and flexible, governed by the starting point and not the end point.”

Strategy, in other words, looks like this:

iPod_Family_by_zerocustom1989

And like this:

netflix 3s.001

***

Much has been made of the (rather obvious) differences between the product and its advertising, and much silly nonsense – “advertising is what you do when you don’t have a good product” – peddled.

But when we look to what makes for effective, profitable advertising, we see that effective advertising is not so different, not so divorced from good products and platforms. For both are by necessity, long-term activities.

It is of course an inevitable feature of a world of finite budgets and an ever-expanding array of possibilities and disciplines that vested interest works to silo and set into competition all the disciplines, products and approaches we are now presented with.

But recognising the shared agenda of advertising and platforms serves to remind us that marketing is not a bolt-on to product, and that product or platform development and advertising need not be antithetical.

Indeed it reminds us that sustained mental (and with it, physical) availability is as useful and valuable to people as products that meet their needs or wants. Advertising in other words, is a fundamental and intrinsic part of a product’s manifestation and value in the real world.

Speaking at an event to mark the fortieth anniversary of the planning discipline, Jon Steel, made an impassioned plea for better, longer-term thinking:

We should be angered by the accountability mindset that means we’re making more and more decisions based on what can be measured, rather than what’s really important. How many companies today are setting “Big, Hairy Audacious Goals?” Certainly not enough, and we are also culpable in their failure to do this. We need to inject more ambition into our objectives…  the role for planning in the next forty years is to help clients once more to set the right objectives. The right objectives for brands and for business, not just for communications.”

It really is time for a more holistic perspective on marketing. For a more vigorous rejection of short-termism. And perhaps time that we gave up on the ‘campaign’ mindset with its attendant baggage, and adopted the perspective of long-term platform building.

***

Sources

Jeff Bezos, letter to shareholders, 1997

Les Binet & Peter Field, The Long And Short Of It: Balancing Short And Long-Term Marketing Strategies

Lawrence Freedman, Strategy: A History

Jon Steel, ‘Planning at 40: Solving the wrong problems

Brand building in a digital age: A compass for uncharted waters

great-wide-ocean

 

“It is very difficult to study history-in-the making, but what is occurring right now is the most powerful influence on the economy, the consumer and brand marketing since the Industrial Revolution. We are witnessing The Great Marketing Revolution. Our job is to be aware of it, its pattern and its destination so we can take sure, methodical steps to capitalize on it”

William T. Moran, 1956

 

[You don’t have to read this. It is an edited and slightly improved version of an older and longer post, written for the 50th anniversary edition of Admap. I reproduce it here only in so much as this place is also my notebook. The anniversary edition of Admap by contrast, IS very much worth reading in its entirety]

 

Has everything changed? Have all the old lessons and practices been rendered obsolete? Is marketing as we knew it really dead? And is it possible to move beyond rhetoric and ground the necessary speculation in at least a semblance of empirical evidence?

Yes… and no. 

No. 

No. 

Yes.

But let’s start with a simple framework for enquiry, something that gives us a starting point for thinking about how brands are built.

***

The levers of growth

It’s over a decade old, but that provided by the marketing consultant and former adman William Moran – a version of the 4Ps model – gives us a framework for evaluating marketing’s outputs, and for thinking about how marketing has changed, is changing, and must change. 

For Moran the two fundamental processes which can produce change in sales, are a change in perceived Value and a change in Presence.

Change in Value he argued, can come about from a change in perceived utilities (attributes), and a change in relative price.

Presence Moran regards as “the lubricator which simply facilitates sales by reducing the mental friction in the consumer’s decision-making process.”

Moran distinguished between physical presence (being visible and easily buyable) and mental presence (being easily thought of).

Thanks to the the work of Les Binet, Peter Field, and the IPA we can identify some vital multiplying factors, namely time, investment and creativity.

We know that advertising’s ability to create value is most keenly felt in the long-term. Time, in other words is vital to success.

We know that the most profitable campaigns are those that drive both volume and pricing. 

We know that campaigns require time for their effects to be felt, for while volume increases are relatively easy to achieve in the short-term, price increases take longer.

And we know that longer-term goals such as share growth or reduction of price sensitivity demand sustained brand building.

The creation of memory, brands, and sustainable business growth in other words takes time. And as such it is, like it or not, at odds with one of the defining characteristics of our age – immediacy.

This is not to deny the value of brands being responsive in the here and now. 

Nor is this to suggest that short-term activity is without value. As Binet and Field note, the data suggests that the optimum balance of long-term brand building and short-term activation expenditure is on average around 60:40.

But simply delivering short-term activity does not lead to success in the long term, and long-term effects are not simply an accumulation of short-term effects. They are different kinds of effects. 

Coupled with time, investment levels are a vital multiplying factor.

We know that the critical metric that determines the level of a brand’s market share growth is the degree to which its share of voice exceeds its market share (excess share of voice, or ESOV).

We know that an average of 0.5% points of share growth can be expected per 10% points of ESOV. 

We also know of course that new, ‘earned’ methods of distribution marketing content have allowed marketers to extract new efficiencies. 

But there is little evidence to suggest that the paid media investment and business results have been completely and irrevocably decoupled. 

As Binet and Field conclude: “It is often asserted that share of voice is irrelevant in the digital era: this is not true. The correlation of SOV with market share growth is getting stronger and the returns on investing in SOV are also increasing as the level of brand choice continues to grow and the internet becomes more crowded with commercial activity.”

So to some degree, market share can be bought. However, we know that the unfair advantage that any marketer can choose to leverage is the power of creativity.

We know this from the IPA’s analysis of the 257 IPA Effectiveness cases studies for which Gunn Report scores were all available.

Creatively-awarded campaigns generate on average 5.7 points of share growth per 10 points of ESOV, compared with just 0.5 points of share growth for non-awarded campaigns.

So if the levers of brand building have been utility, price, and presence, and their multipliers have been time, investment, and creativity, where do we find ourselves today, in this, our digital age?

New forms of utility

We are seeing the malleability of software allowing for marketers to evolve, iterate and improve the product experience in response to consumer interactions in the real world, not the laboratory.

In some markets we are seeing the emergence of new models of product ownership, in which access to goods and services is rented, rather than outright ownership of goods given over to consumers.

The access, interactivity and immediacy that technology now affords us means we are able to directly involve consumers in the creation, iteration, and indeed running, of products and services.

We are seeing utility being used as a vehicle for publicity and promotion. Whereas product development and publicity occupied very distinct silos, marketing is now being “baked into” products and services.

Of course more intangible utility has not gone away. We all live and work – skilfully and effortlessly – within two worlds; the world of objects and the world of meanings. And we need this imagined world to give our identities, lives and experiences depth, significance and meaning.

But we are also are seeing new forms of utility. We are seeing new business models, new businesses, and new brands. And we are seeing product functionality being used to build and sustain the meaning and emotional component of brands.

So perhaps this new world of utility is teaching us marketing to value the sausage as much as the sizzle. And in as much as what people really need from marketers is not communications, but better products and services, it suggests that far from being ‘dead’, marketing’s original mission is very much alive and well.

New avenues of availability

Sharp, like Moran, has rightly underscored the importance of physical availability: “Being easy to notice and buy is essential, because buyers do not have strong preferences even for the brands they are loyal to.”

There was a time of course when physical shelf space and availability was the crucial factor in the quest to make brands easy to buy. 

Today we are seeing digital availability being used to enhance physical availability, and we are seeing digital availability being used to replace or bypass physical availability. 

We are seeing brands responding to and anticipating people’s need or interest.

We are seeing brands connect directly with customers, rather than via third parties.

We are seeing brands exploiting the interconnectedness of all things digital to create shelf space and make it easy for people to buy.

We are an explosion in the ways in which brands can create memory and meaning. Creativity is now properly unbounded, no longer constrained by media formats.

We are of course, able to give consumers the opportunity to interact in all manner of ways from the undemanding and lightweight to the participative and immersive.

We are seeing brands customize their content for different consumer segments.

We are certainly seeing brands relentlessly stalk consumers as they travel across the internet

We are able to employ consumers as advocates, ambassadors, co-creators, publicists, and media channels.

And increasingly, we are able to customize the content, timing, and targeting of our content.

New models of pricing

The economics of digital goods are allowing brands to offer consumers goods and services for free. As Chris Anderson first wrote in Wired magazine: “It’s now clear that practically everything Web technology touches starts down the path to gratis, at least as far as we consumers are concerned.”

We’re seeing brands able to employ the minority of paying users to support the majority of non-paying users, because the cost of serving that majority is close enough to zero to call it nothing.

We’re seeing brands employ ‘freemium’ pricing models in which they offer free version of their product or service as a vehicle for recruiting users, and charging for advanced features, functionality, virtual goods, or an ad-free experience.

We’re seeing some brands test dynamic pricing.  

Mobile technology has of course liberated consumers from having their choice limited by what’s in front of them on shelf. Consumers are now able to treat physical stories as showrooms in which they search for a cheaper option online.

***

Back to the future

Even a cursory survey such as this brings home the scope depth, and velocity of change we are surrounded by. These are indeed exhilarating times. But viewed through the lens of Moran’s simple model, they remind us of two essential things. 

First, the fundamental brand building mechanics of value and presence, the subprocesses of utility, pricing, and the creation of physical and mental presence – together with the necessity of time, investment, and creativity – have not evaporated. Marketers struggling to keep up with and make sense of the blizzard of change, evolution, disruption, advice (good, self-serving, and idiotic) and opinion need not despair. Look beneath the veneer of rhetoric, and one sees that the old imperatives still hold true.

But this is not an excuse for complacency. While the fundamental outputs of marketing have not been rendered obsolete, how marketers deliver value and presence is most certainly being reworked.

Connectivity, interactivity, immediacy, sociability, transparency, collaboration, prediction, responsiveness, targeting, automation, disintermediation, customization, mobility… all of these phenomenon (and more) are fundamentally remaking how brands connect with consumers. Though our choice of how is, of course, always contingent. On the nature of the task, the competition, the audience, and the brand. 

There is then, as much to unlearn as there is to relearn. And as technology and code continue to remake our lives, there are inevitably, new abilities to acquire and add to the old ones. For both the individual, and the corporation.

But lest we take too much comfort from this, Moran’s model also provides us with another vital reminder. One might even call it a wakeup call. Namely that marketing is not, and has never been, synonymous with advertising. Its remit and output is far broader and more far-reaching than merely the development of communications.

So when publicity can be baked into the product, product design can be a means of meaning manufacture, distribution can be baked into the product, physical products are assuming a digital life, social channels are becoming means of delivering customer services, pricing models are being used as distribution mechanics, marketing content is no longer a dead end and is becoming just the beginning of a customer journey, the gap between publicity and purchase can be compressed, the consumer is a distribution channel, and the consumer can no longer be held at arm’s length, it really is time to let go of the antiquated (and ill-founded) notion that marketing is synonymous with ‘messaging’.

And it is high time that we blow up the mental and organisational silos that still bedevil us – story versus code, advertising versus product, utility versus image, etc.

Perhaps if we all thought of ourselves in the business of creating connections – in the mind, between people, companies and brands, and between people and other people – then we’d find ourselves better adapted to the new environments and possibilities of our age.

In an age defined by its connectedness – people to people, people to things, and things to other things – that seems a far more accurate and useful perspective on what we all do.

“Only connect”, as E.M. Forster wrote.

***

 

 

“Just move, me dude”: The ancient path to effectiveness

faccia_fai1 (1)

All of what follows should should be nothing more than a truism, known to all marketers: That human decision making is far from rational. It’s been argued, elaborated upon and more rigorously examined by other, far more expert minds.

But there is enough infrastructure, paraphenalia, received wisdom and plain old bad practice to suggest that we need to keep revisiting it.

****

Homo sapiens 1.0

Whatever  Plato and Descartes might have told us – and whatever some marketers might tell themselves – we are at our core, driven not by reason and choice, but by far more ancient, intuitive, and often irrational emotions, impulses and instincts.

Reason and consciousness are but a thin veneer on top of the much older hardwiring and workings of the mind.  For all the wonders, sophistication and advances of our modern age, we are  still very much homo sapiens 1.0, driven by age old hungers, drives and responses.

Of course the world has changed radically since our mental foundations were laid, and the complexities of modernity work to both exacerbate and frustrate these impulses. And it is in this coming together of the ancient and the modern that the opportunity to overcome indifference lies.

It is perhaps the curse and thrill of every age to believe that we are living through unprecedented change. And we today are no different, seemingly surrounded by change on ever side, both ephemeral and significant. But our story of how to survive and prosper amidst our age’s wonders and complexities begins with what has not changed.

The belief that any one thing (like the internet) or phenomenon will Change Everything Forever encourages us to focus on the superficial surface of things, which do of course change all the time.  Yet as the psychologist Nicholas Humphrey reminds us:

Cultural and technical innovations can certainly alter the trajectory of individual human lives. But, while human beings continue to reproduce by having sex and each new generation goes back to square one, then every baby begins life with a set of inherited dispositions and instincts that evolved in the technological dark ages… Let’s dream, if we like, of revolution. But be prepared for more of the same.”

The surface trappings of life and culture may have changed, yet the choices, predicaments and motivations of the characters of Homer, Shakespeare, Tolstoy, Austen, Dickens are as vividly meaningful and recognizable as they were when audiences first encountered them. The stuff of story, myth, and human biography – love, sex, sacrifice, war, politics, redemption, jealousy, ambition, heartbreak, altruism, heroism – is enduring and universal. As Edward Wilson – one of the world’s most preeminent biologists and naturalists – puts it:

We have created a Star wars civilization, with stone age emotions, medieval institutions, and god-like technology.”

When it comes to understanding those stone age emotions, it is perhaps fair to say that we know next to nothing about how the mind works. This should probably not surprise us. There are after all, 100 trillion constantly changing connections in the brain – more than there are atoms in the entire universe.

In contemplating the mysteries, complexities and marvels of the brain, the psychologist Steven Pinker cites Emily Dickinson’s poem ‘The brain is wider than the sky’:

brain 2.001Notes Pinker:

In its staggering complexity, its explosive combinatorial computation, and its limitless ability to imagine real and hypothetical worlds, the brain, truly, is wider than the sky. The poem itself proves it. Simply to understand the comparison in each verse, the brain of the reader must contain the sky and  absorb the sea and visualize each one at the same scale as the brain itself.”

Anybody who claims to have conclusively worked out how the human brain works is either deluded, or a charlatan. Or both.

That said, neuroscience and psychology have begun to open up a small window on what interests and moves us. And what this reveals is that while we have undoubtedly come a long way as a species, we are still very much homo sapiens version 1.0.

A tale of two systems

The notion of ‘evolution’ suggests a process of wholesale change and transformation. In our case from animals, to sophisticated creatures of consciousness and reason. But the story of the the human brain’s development is less one of transformation and more one of accretion, addition, and enhancement.

As a result, the brain is a patchwork of different circuits and structures built upon our original brain. And this is the key point. Our primitive brain and its workings has not disappeared. It still continues to act as the home of our unaware, emotional and intuitive thought processes. Wilson puts it thus:

The more we learn about our physical existence, the more apparent it becomes that even the most complex forms of human behaviour are ultimately biological. They display the specializations evolved across millions of years by our primate ancestors. the indelible stamp of evolution is clear in the idiosyncratic manner in which humanity’s sensory channels narrow our unaided perception of reality. It is confirmed in the way hereditarily prepared and counter-prepared programs guide the development of the mind.”

The older and the newer parts of the brain are enmeshed and wired together. So rather than function as an entirely separate process, what we characterize as ‘reason’ is fundamentally dependent on these more basic and older processes. The implications are significant. For despite all the accomplishments of civilization, our powers of reason are but a thin veneer on top of something much more primitive and instinctive.

The work of the Nobel Prize-winning psychologist Daniel Kahneman for example, has shown how we are capable of two modes of thought, and how our responses and decisions are shaped by the interplay between what he  characterizes as ‘System 1’ and the newer ‘System 2’.

System 1 is always on, constantly originating impressions, intuitions, and feelings in response to the outside world’s stimuli for System 2. And as Kahneman’s work has shown, System 1 does not provide us with a clear and objective view of the world, but rather works to edit, filter and interpret it. It actively works to create a coherent pattern of ideas in the memory, enjoys illusions of truth, infers and invents causes and intentions, is biased to believe and confirm, exaggerates consistency, and is more sensitive to changes than to states.

We’ve long been accustomed to think of reason and emotion as being in conflict with one another. Plato started it, characterizing the mind as a chariot pulled by two horses – one well-bred the other obstinate – with the rational brain acting as charioteer, holding the reins and keeping the horses in check and on course. And later we had Freud arguing that the mind was locked in perpetual conflict between the primitive id and the conscious and reasoning ego. And of course the popular notion of a brain ‘divided’ into separately functioning left and right sides endures still in our collective consciousness.

But the truth is that our older mental systems and processes work with the newer ones.

As Kahneman, argues, System 1 provides System 2 with the raw material. And in contrast to System’s 1‘s constant activity, System 2 is fundamentally lazy. Most of the time, it adopts the suggestions of System 1 with little or no modification, turning impressions into explicit beliefs and impulses into deliberate and voluntary actions.

Navigating our way past indifference

It was heresy when he first wrote it, but the neuroscientists and psychologists of today are demonstrating quite how prescient the eighteenth century philosopher David Hume was when he declared, “Reason is, and ought only to be the slave of the passions, and can never pretend to any other office than to serve and obey them.”

What Edmund Wilson calls “the indelible stamp of our animal ancestry” is inescapable – “we are an evolutionary chimera, living on intelligence steered by the demands of animal instinct.” It is impossible for us to escape the inheritance of our genetic and cultural evolution. As Wilson notes, “they shape the way we perceive the world, “the options we open to ourselves, and the responses we find easiest and most rewarding to make.”

So if we want to create demand for our work and overcome the hurdle of indifference, then it is our older nature and selves we must connect with.

Push strategies that rely on brute force can and do work. But creating a pull effect is significantly more efficient. You get a far bigger effect in return for the same amount of effort.

Creating that pull effect – overcoming people’s indifference and creating content that people find interesting, relevant, compelling irresistible, fascinating – demands we connect with System 1 for it is this mental system that interprets and makes sense of the the world.

In other words if we want to involve people in what we create, then we must arouse, interest, and connect with our older brain and more ancient instincts. If you want to move people’s behaviors, you have to emotionally move them. As Dan Wieden put it in an interview, “Just move me, dude.”

(We should distinguish here between stimulus and response. For it is emotional responses that we should be seeking. And there are all manner of ways in which we can evoke that. That might be a well-timed relevant piece of rational information. It might be a brilliantly delivered piece of customer service. And yes, it might be a piece of emotive storytelling).

We can ignore this truth about human nature at our peril. In his analysis of why the Democrats consistently failed to achieve electoral success, the psychologist and political strategist Drew Westen has argued that the root cause of the party’s failure was its insistence on treating the electorate and voting behaviour as being driven by reason and analysis. Consequently according to Westen – and in sharp contrast to what the Republican party had long instinctively grasped – the Democrats inundated voters with the complexities of policy detail, rather than framing them in the context of an emotionally compelling, intuitively appealing narrative.

Westen’s advice for politicians and political strategists is that if you want to influence voting behavior then the key lies in activating the older, emotional brain:

You can slog it out for those few millimeters of cerebral turf that processes facts, figures, and policy statements. Or you can take your campaign to the broader neural electorate, collecting delegates throughout the brain and targeting different emotional states.”

Similarly, the advertising veterans Paul Feldwick and Robert Heath have urged advertisers to let go of the belief that advertising works as a rational communication vehicle. It’s time they argue that advertising professionals recognize that most advertising simply does not work through planting rational messages in people’s memories. Instead, it works to create networks of associations in the brain through visuals, sounds, symbols, music, gestures, context and a host of other things that are too often simply treated as a means of gaining attention or ‘recall’.

While many in marketing- and adland still seem to struggle to accommodate themselves to this truth, the fact of the matter is that people do not rationally process advertising. Advertising, as Feldwick and Heath argue, works through activating the emotional (and usually subconscious) processes of the brain. As they put it, this perspective offers “a more plausible explanation of how 30 seconds of apparent nonsense, watched through half-closed eyes, can affect brand preference and buying behaviour, than the old idea of the ‘selling proposition’.”

Indeed the complexities of our modern age make connecting with our older selves all the more pressing for cultural producers. For the fact that we operate with 1.0 brains in a 3.0 (ever more post-industrial) world inevitably results in tensions, hungers, needs and desires. The rolling back of tradition, the relentless expansion of urbanization, the central place of celebrity in popular culture, the liberation of individual choices, the acceleration of culture, the cataclysms of the last century and the complexities of the current… All of these characteristics of our modern age can both exacerbate our ancient and deep-seated appetites, drives, and impulses as well as frustrate and challenge them.

And where there is a tension, there too lies the possibility of people being not indifferent but actually interested.

It is commonplace to make the distinction between artistic and commercial endeavors. The poet versus the salesman. The painter versus the ad man. Meaning versus entertainment. The gallery versus the shopping mall. The muse versus the market. Commerce versus art. Objectivity versus subjectivity. But these are false distinctions.  For as cultural participants – as meaning creators, and weavers of magic – both the artist and the salesman must seek to overcome the challenge of indifference.

And whether our cultural agendas are commercial or artistic in nature, success  – creating pull rather than relying on push – lies in finding and understanding the tension between modernity and this older yet enduring version of our selves. For amidst the complexities and paradoxes born of the intersection and struggle between our ancient selves and our modern lives emerges a timeless and indeed inescapable story about who we really are and what we really need, want, and desire.

The science writer Stephen Pinker has made the plea that we see ourselves for what we truly are. Not as products of culture and nurture. Not even as the product of the interplay between nature and culture. But rather, that we see through to our real, fundamental, and universal human nature. Not least of all because it’s a perspective that emphasizes as he puts it, “the psychological unity of our species beneath the superficial differences of physical appearance and parochial culture.”

And if we want to connect with and move people (and however we choose to do that) if we wish to enthrall them, captivate them, seduce them, and yes, move them, then so too must we grasp and embrace our true nature.

****

Sources

Robert Heath and Paul Feldwick, ‘Fifty years using the wrong model of advertising’, International Journal of Market Research, Vol. 50, No. 1, 2008

Nicholas Humphrey, Edge World Question Center, http://www.edge.org/q2009/q09_3.html

David Hume, A Treatise of Human Nature (2.3.3.4)

Daniel Kahneman, Thinking, Fast and Slow 

Stephen Pinker, The Blank Slate: The Modern Denial Of Human Nature

John Ratey, A User’s Guide To The Brain: Perception, Attention, And The Four Theaters Of The Brain

Drew Westen, The Political Brain: The Role of Emotion In Deciding The Fate Of The Nation

Edward O. Wilson, The Social Conquest Of The World

Time to get out of the message business

jh0868_bottle

If there is one thing guaranteed to relegate a marketing to both ineffectiveness and obsolescence, it is the belief that its primary form of influencing consumer behaviour is through messaging.

Messaging doesn’t reflect how people consume advertising and make sense of brands.

We know that the brain is not some rigid filing system in which memories reside as fully formed recordings. It is something altogether more dynamic and malleable.

Indeed it’s more accurate to think of memory as a process, not a thing. Our brain’s networks of nerve cells or ‘neurons’ are not fixed entities, but rather, are dynamic and continuously modified by experience. What people experience results in new connections in the structure of our brains.

While parts of marketingland still believe we’re in business of transmitting of information, of ‘communicating’ abstract, intellectual ‘messages’ or propositions, advertising doesn’t work through filing verbal messages and propositions in people’s mental filing systems.

Memory actually works through the creation of connections.  A brand is simply a set of connections and associations in the brain. We form and access memories of brands by creating and activating these networks of associations.

So people don’t consume and file away abstract ideas and propositions. They consume (as Robert Heath has shown, they often with fairly low levels of attention) all the visual, verbal, audible, tangible characteristics of our content – and these create new connections and in the brain.

Judith Williamson in her wonderful, essential, hostile and demanding book Decoding Advertising: Ideology and Meaning In Advertising demonstrates how advertising’s real work lies in its aesthetic wholes, and how it operates larges silently, through its codes and signals, rather than messages:

What an advertisement ‘says’ is merely what it claims to say; it is part of the deceptive mythology of advertising to believe that an advertisement is simply a transparent vehicle for a ‘message’ behind it. Certainly a large part of any advertisement is this ‘message’: we are told something about a product, and asked to buy it. the information we are given is frequently untrue, and even when it is true, we are often being persuaded to buy products which are unnecessary… a criticism of advertising on these grounds is valid, and I would support it. However such a criticism is in many ways the greatest obstacle of all to a true understanding of the role of advertisements in our society, because it is based on the assumption that ads are merely the invisible  conveyors of certain undesirable messages, and only sees meaning in the overt ‘content’ of the ad rather than it its ‘form’ – in other words, ignoring the ‘content’ of the ‘form’.”

So the consumption and decoding of marketing content is something altogether fuzzier than we often allow for. As Stephen King in JWT’s Planning Guide noted back in 1974:

An advertisement as a stimulus is a combination of medium, words, pictures, movements, symbols, associations, tones of voice, etc. The stimulus is received as a totality; the receiver does not separate content and form. The individual elements of an advertisement have no meaning on their own. They can only be judged in combination.”

Feldwick has similarly done much to remind us that advertising, like art does not work through reductionist concepts, but through the experience of aesthetic wholes.

So the What and How are inseparable. We exercise brand impressionism – rather than ‘taking out messages’, we are left with general impressions from what we’re exposed to.

Treating creativity merely as a means of tricking or bribing the viewer into paying attention to the message within it profoundly undervalues and undermines the both the nature and the value of creativity.

Creativity isn’t some kind of distraction tactic, bait or bribe. It isn’t a wrapper or envelope for a message.

It IS the content.

But there is another pressing issue with the idea of messaging.

For aside from the fact that the marketing-as-message model of influencing consumer behaviour doesn’t reflect how people consume communications, it’s singularly ill-suited to adapting itself to people’s digital interactions.

Searching, browsing, searching, tagging, uploading, downloading, sharing, linking, commenting, buying, playing, liking… To varying degrees of involvement and intensity, these are behaviors.

And messaging in an environment characterized by behaviours obviously struggles.

It either gatecrashes, misses out on vast opportunity, or is simply rendered impotent.

Small wonder then, that those charged with creating and leveraging digital behaviors should regard those who believe they are in the business of issuing messages with such bafflement or suspicion. And indeed vice versa.

The messaging school of marketing misunderstands the human mind, misunderstands the nature of creativity, and opens up a deeply unhelpful schism.

It really is time to let get out of the message business.

We need, to borrow the words of Jaron Lanier, a palette cleansing, a broadening of horizons.

Perhaps if we all thought of ourselves in the business of creating connections, then we’d find ourselves better adapted to the new environments and possibilities of our age.

And perhaps we’d begin to see how absurd are the solios that we’ve insisted on operating in.

For if we we wish to be effective, we are about creating connections.

Connections in the mind.

Connections between people, companies and brands.

And connections between people and other people.

In an age defined by its relentlessly blooming connectedness – people to people, people to things, and things to other things – that seems a far more accurate and useful perspective on what we all do.

“Only connect”, as E.M. Forster wrote.