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A few days ago at TechCrunch in San Francisco, Google’s Eric Schmidt told us about his vision for the future. Not surprisingly, Google is at the centre of it. It’s a tech utopia where we are always connected, where we can find what we want, when we want it, in what so ever colour we’d like it in and have access to the sum of human knowledge – good, bad or just plain incorrect in some case.
Schmidt believes, “We are at one of those points in technology where something interesting is about to happen,” and that soon, we’ll be more willing to let computers take over life’s more mundane tasks (such as driving the car – a terrifying thought if they crash with the frequency of my laptop!) thereby freeing up our time and enabling us to do other more ‘worthwhile’ things.
Now, setting aside the obvious temptation to draw analogies between this and Wachowski brothers Matrix-esque view of Humankinds future, I suspect there’s a degree of truth and indeed inevitability about Schmidt’s beliefs.
Our acceptance and growing reliance on the proliferation of smart technology is extraordinary – fifteen years ago I worked for a large London agency that was debating the merits of getting email – after all, we had several fax machines. Now, I practically have a nervous breakdown when my iPhone can’t get a 3G signal thereby barring me from my email and, I am not alone. Take any flight and watch what the passengers do as soon as the wheels hit the tarmac – beep, beep, on go their Blackberry’s!
So has technology taken over our lives?
Yes, of course it has (in truth it started when some hairy caveman stuck a rod through the centre of a round disk and invented the wheel) but, this is not necessarily a bad thing providing it’s tempered with dose of humanity. It’s all too easy for us to be drawn in by the shiny little LCD screens but, let us not forget that at the end of the day, human interaction is a fantastic thing (if you don’t believe me, watch Disney’s Wall.e).
Whilst I might find it terribly useful to do my weeks grocery shopping from the train, it’s not as enjoyable as exploring the store, talking to the butcher and choosing the food in person.
And perhaps this is my point. It’s not enough for this sort of technology to be useful it has to be intuitive, interactive, enjoyable and human for us to engage with it fully.
As marketers we need to understand this more so now than ever before. We have seen so many companies (and their eager agencies) jump on the ‘App’ bandwagon to varying degrees of success, (even my local taxi firm has an App – so I can track where my cab isn’t).
With the ‘Outernet’, Web 3.0 and augmented reality coming our way faster that the proverbial pulse down a fibre optic cable, we need to find not only appropriate but useful and fun ways to exploit the communications opportunities these technologies present us with.
And yes, we at thenetworkone are putting ‘our money where our mouth is’, by offering thenetworkone member agencies and friends a series of seminars workshops on the subject in the coming months.
Watch your iPhone, Blackberry, email etc for more information.
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Cannes 2010: thenetworkone review
Last week, with a few colleagues and around eight thousand agency people, producers, writers and occasionally seen marketing clients, I was fortunate enough to speak at and attend the 2010 Cannes Advertising Festival. Several people asked me to write a personal account of what I saw, heard and learned. Here it is.
- Julian Boulding, President, thenetworkone
The Major Trend in 2010
Cannes is like the Oscars – a key annual barometer of industry and social trends.
The big prizes at Cannes are the Grand Prix’s. These are awarded for the campaigns most admired by the judges. If no work is good enough in a category, no Grand Prix is awarded (there was no Grand Prix for radio this year, for example).
So which campaigns won…and what pattern do we see? A very clear pattern, in fact.
Of thirteen Grand Prix’s which were awarded:
ONLY THREE WERE FOR ADVERTISEMENTS, OR ADVERTISING CAMPAIGNS.
These were:
- Wieden and Kennedy, for Old Spice
- Anomaly New York, for Diesel
- AMV BBDO London, for the Metroplitan Police
THE OTHER TEN WERE FOR PR / EVENT / EXPERIENTIAL IDEAS AND PLATFORMS. These were:
- Wieden and Kennedy for Nike (the Livestrong chalkbot) – two Grand Prix’s
- TBWA Chiat Day for Gatorade (replay of a historic football game) – also two Grand Prix’s
- Happiness Brussels for Toyota (the iQ font designed by a car)
- Saatchi Argentina for Cerveza Andes (the teletransporter)
- Orcan Broadband by Special Group New Zealand (the Iggy Pop remix)
- Almap BBDO for Billboard (the faces on the cover)
- DDB Stockholm for VW (the fun theory)
- Leo Burnett for Canon EOS (the photochains)
Do take a look. All these campaigns can be viewed at www.canneslions.com. Half an hour well spent.
After years of talking about the growing effect of the internet, our industry has finally woken up and noticed the effect: the move from “sticky content” (look at me) to “slippery content” (which people share with each other). Advertising is very vibrant. Advertisements are in decline. Advertising and PR are now one and the same thing.
The big insight
Every now and again at Cannes, you hear an insight which almost doesn’t get noticed, because it’s so obvious to the person making the comment, that they don’t make a big deal out of it.
One speaker I always go to hear is Jimmy Maymann of Go Viral. His company tracks (and influences) the way consumers use the internet: where they come from, how they behave, where they travel, how long they spend on sites, how they upload content, how they share content, what they respond to, when, how and where they buy. He deals in observation and measurement, not only opinion.
Jimmy said “we’ve found that product advertising is most successful when it also talks about the company behind the product”.
Think about this a moment. Where did “the brand” go in this equation?
Now test it against some companies you know, where products and features are rather important. Take mobile handsets. How much do people know about Apple as a company? (a lot: who founded it, who runs it, what it’s like to work for…). How much do you know about Nokia as a company? Does anyone know who runs it, beyond a few industry insiders? Or what their offices are like? And who is doing better these days…Apple or Nokia? Now repeat the exercise with Google and Yahoo, or Virgin Atlantic and American Airlines.
I think Jimmy’s onto something here, and he’s not alone. Procter & Gamble, the smartest marketers on the planet, just launched their first ever corporate company campaign in the US (P&G supports moms, basically). And yes, they measure its effect, and yes, it’s positive on sales and net promoter scores.
Every marketing company wants to think about this. The reason is not hard to see.
Today, information is available and people discuss what they know in public forums. They have little tolerance for spin, greenwash and other falsehoods. They want the truth, genuineness and authenticity.
A brand, as we all know, is an artificial construct, created and controlled by unseen hands. Artificial doesn’t cut it any more.
A company is a real entity: a group of people, a legal entity, with offices, factories and employees.
In the 2010’s, companies will become more important than brands. You heard it here first.
That doesn’t mean brands are dead. Marc Pritchard, CMO of P&G, gave an eloquent description of how his brands are each based on a specific purpose which guides all their activity, from tv advertising to social programs. Vicks supports research into respiratory diseases; Tide drives mobile Laundromats into disaster areas, like New Orleans after the floods. But they all start from P&G’s corporate purpose, to improve the lives of the world’s consumers.
Joe Tripodi , CMO of Coca Cola, talked about how his company is spreading happiness around the world. Keith Weed, CMO of Unilever, believes that multinational corporations are better placed than governments to solve world problems like global warming, because they have a broader perspective than narrow national interests. That might be stretching a point, but the theme is clear: big companies are back.
Some facts and figures
Here are a few soundbite statistics that will liven up any conference presentation you may be asked to make:
- In the USA, online video reaches an audience of 170 million people. The biggest network television station, ABC, reaches only 100 million.
- USA is still the biggest advertising market, by far: US adspend in 2009 was $180 billion. By comparison, Japan was $42 billion, China $39 billion, UK and Germany around $25 billion each. So US adspend is almost 50% higher than the next four countries combined.
- China is where the action is, in terms of internet. 400 million “netizens”, 221 million bloggers, 176 million people registered on social networks. Compared to India where only 40 million people have internet access at all.
- In mobile, Japan and Korea still lead the way. 40% of Koreans now use mobile phones for small payments. But India is coming up fast…there are more mobile phones than toilets. If they sort out the problem of multiple platforms, the same which slowed down the USA, mobile will be a major medium there very soon.
- Everyone wants an app, but who actually uses them? The quick answer is iPhone users. The average (enabled) mobile phone user downloads 13 apps and uses 8. The average iPhone user downloads 25 apps and uses 15. 75% of mobile data traffic in UK is now via iPhones.
But if you are giving a conference presentation - do not say that if Facebook users were a nation, it would be the third largest in the world. It’s true, but everyone who goes to conferences now knows this already.
The world of agencies
Sir Martin Sorrell of WPP said in Campaign magazine recently, and repeated at Cannes: “I think there are pitfalls in size. Our business, with the exception of media buying, does not lend itself to economies of scale…the perception among clients is that the bigger something gets, the worse it gets”.
And for sure, the independent agencies performed very creditably at Cannes this year, compared to the rich networks whose budgets stretch more easily to entering awards. Of the Grand Prix’s, seven went to network agencies and six to independents:
- 5 went to Omnicom agencies (well done BBDO, DDB and TBWA)
- 2 went to Publicis Groupe agencies (Leo Burnett and Saatchi)
- 3 went to Wieden & Kennedy, a privately owned micro-network
- 1 went to Crispin Porter Bogusky, a standalone agency belonging to Canadian-owned MDC
- 3 went to other independents (well done Happiness Brussels, Anomaly New York and Special Group New Zealand).
WPP, Interpublic Group and Havas all scored zero on this measure.
And interestingly, 4 out of 5 of Omnicom’s Grand Prix’s went to agencies which still keep their former names and character: one each to Almap BBDO in Brazil and Abbott Mead Vickers BBDO in London, and two to TBWA Chiat Day in California.
Perhaps Sir Martin is right, and smaller is more beautiful…
Aside from the prizes, there was much discussion about crowdsourcing. Keith Weed of Unilever advocates it, though he’s not about to dispense with his agencies altogether. “Nokia showed a very successful film for the Nokia N8 product (called foosball – see it at http://www.youtube.com/watch?v=h5jKcDH9s64) and revealed it was an unsolicited idea, rather than from Wieden and Kennedy. If Wieden is your agency and you still get better ads from freelancers, agencies could really be in trouble!
Back to a serious comment, though, and another telling insight. This time about agencies.
Michael Roth, Chairman of Interpublic Group (which owns McCann, Draft FCB, Lowe, etc) commented: “Because digital agencies are mainly project based, they are better collaborators.”
Now that’s interesting.
As communications fragments, clients have to employ multiple agencies (or move work in-house). Open source becomes the mantra. The future belongs to the collaborators.
Is the future of agencies project based? It’s not such a dumb idea. The movie industry always was, and that seems rather healthier than the advertising agency business these days.
thenetworkone at Cannes
Just a little note from the author at this point about our own seminar, the “Independent Agency Showcase”. The main auditorium and the gallery were both full and people were sitting in the aisles. That never happened to us before, so we must be doing something right.
The three independent agencies we introduced were Happiness Brussels (winner of the Design Grand Prix, although we didn’t know that, until later), Sid Lee and Taproot India.
Aside from showing some great work – Happiness talked about the way they have broken down the traditional copywriter/art director creative structure, Sid Lee about how their agency is a “collective” of creative talent, and Taproot about how they use their creative skills as a force for good in society. For some reason only the Sid Lee presentation is currently online at the Cannes Lions website, but we will make the others available as soon as we get hold of the film. If any of you would like a copy please let us know.
A final note: the most amazing thing in the whole show
OK, this didn’t win any awards, and probably wasn’t even entered. But here goes. The other great seminar presenter (after Jimmy Maymann) is Akira Kagami of Dentsu. If you ever see him on a programme, book a ticket. He’s a quietly spoken man but he finds the most interesting work you’ll ever see, mostly from Asia.
This year he focussed on Japan and one film he showed was about Hatsune Miku.
You haven’t heard of her? She’s the biggest teenage pop star in Japan right now. More than 20,000 people have written songs for her and she has performed them all.
She is actually Vocaloid, based on a manga character and created by Crypton Future Media. OK, voice synthesis isn’t new…but this one gives live concerts. Check out http://www.youtube.com/watch?v=dgjfpoIA054&feature=related and a hundred other variants, or just Google Hatsune Miku. If you’re not awestruck and amazed, you’ve been in the business too long.
Julian Boulding
President, thenetworkone
June 2010
For more information about thenetworkone or to discuss any aspects of this article, please email julian.boulding@thenetworkone.com.
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Of all the major countries in the world, China attracts perhaps the most attention but is the least easy to do business with. It’s really impossible to “read” from the outside. So although we already had two or three good agency partners there, I thought it was really valuable to spend a week in Beijing, Shanghai and Hong Kong, looking, and learning anew. In a few words, this is what I found.
First: China itself.
While the West struggles out of recession, China is still booming. Export sales have slowed, but the Chinese government has re-focussed economic growth internally. A billion or so people still want cars, washing machines, shampoo, cheap flights…there is no shortage of consumer demand.
Two factors are noticeable, though:
1) Margins are thin, both for marketing companies and for agencies. Chinese customers drive hard bargains and business is not always as transparent as it should be.
2) The predicted development of Chinese brands (as opposed to manufactured products) outside China has not happened. It seems to me, that the will is not there right now: for a Chinese brand owner, why invest in marketing in the west when there is so much unfulfilled demand at home? This will change, as the western economy recovers. The plans are in place, they are just on hold. Western brand owners should not relax.
And now: what about agencies? And independent agencies, in particular?
My sense is that the agency scene is stabilising (strange, in a market notorious for short term contracts…but true).
Most of the multinationals have got their act together now. Ogilvy and JWT have been strong for a while. Others are catching up: DDB China for example, ably run by a Dick van Motman, a good friend of mine, has grown from 30 to 300 people which is probably where a large agency should be in China. Most of the large, old-school local agencies have been acquired (although rumours abound that the big holding companies don’t always end up owning quite what they thought they would). Two notable exceptions, DMG and Meikao, have been heavily courted but have chosen not to sell. So the independent option is still there…it always is, somehow!
If you are looking for an agency – what should you do?
The first key question is what kind of agency you want. Agencies in China tend to come in five major types.
1) Large, traditional advertising agencies. Ogilvy, McCann and the like, pretty much as they were 20 years ago in the west. Meikao is similar. Known in China as “4A’s agencies”.
2) Smart young digital agencies, who supply the digital savvy that the large agencies in China simply don’t have. Often only a few people, rarely more than 40 or so – and only the owner is aged over 30. They are mostly sub-contracted by the big ad agencies, although it’s possible to buy their skills direct for a fraction of the price, if you’ve already done the strategic thinking yourself.
3) Event-oriented PR agencies. These have been the driving engine of most brands’ expansion into China. Chinese consumers (and business customers) need to see, touch and feel…advertising alone does not win customers here, for unfamiliar products. Most PR agency presentations consist primarily of photo-records of events and launches they have managed.
4) PR agencies in the traditional sense, divided into those who admit to buying coverage and those who don’t.
5) The next generation of entrepreneurs. The most interesting to us, of course…
The next generation of entrepreneurs is really just beginning to take shape. But there are good agencies to be found, if you know where to look. Again they come in different types.
There are still one or two outstanding, western-owned companies who provide expert help for western brands finding their way into China. Agencies like Eight Partnership, for example: owned and run by Brits and Scandinavians. If you are a brand owner venturing into China for the first time, there is no better place to start.
But the next generation has to be Chinese.
This is clearly happening in marketing companies, as they migrate their management teams from expatriates to Chinese. It’s happened, or happening, in every other country - and China will be no exception. And where clients go, agencies follow.
This does not mean necessarily, that the next generation of Chinese agencies will be run by Chinese from mainland China, who are still relatively new at building brands in a western sense.
It probably means that the next generation will be owned and led by Chinese people from outside mainland China – who “get” the needs of western companies, but speak the language and think in a Chinese way. The Chinese anyway see themselves more as a people, than as a country, which the US and Britain find hard to understand.
Agencies with a bright future would be, for example, WE Marketing (owned by a Hong Kong Chinese entrepreneur who broke away from Grey) and Ortus Group, run by a Singaporean Chinese who also learned his business in western agencies.
Of course the multinational holding companies will continue to try to buy them. But there’s less attraction in being WPP’s seventh acquisition this year, than there was in being the first. So they’re not rushing to sell.
So if you’re a client – where should you look?
If you’re a global client of a multinational network agency, there is really no reason not to stay with them in China. They have the resource, they can buy in the skills they don’t have, and they will have to look after you for the sake of your business in the rest of the world, even if they don’t make much money out of you in low-margin China.
If you’re not, though: think very carefully before you go that route in China. The 4A’s agencies are global pressure to keep margins high (WPP’s global average is around 12 to 15%), and in China that is very difficult. And guess who’s going to get under-serviced, to prop up the agency’s margin? Well, it might be you.
A smaller, younger, hungrier agency run by smart, western-trained people whose first language is Mandarin…could be a lot more attractive, especially for a brand without huge marketing budgets.
But do be careful who you do business with. There are no reliable agency rankings published in China and the internationally recognised award shows are little more mutual back-slapping among multinational network agencies.
We’ve done our homework and are willing to share individually what we’ve learned. Give us a call on +44 207 240 7117 if you’d like to talk. And please, feel free to share your opinions and observations here in this space.
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As over used expressions go, ‘we’re passionate about…” is high on my list.
A well known sofa companies is passionate about their new designer collection, a large travel operator is passionate about giving me a relaxing time and a certain regional development agency is passionate about have me investing in one of their towns.
I might be odd but, I would ague this is about as passion inducing as a proverbial wet weekend in said town!
So what do I think is worth getting passionate about?
Well, I will avoid the obvious temptation to be crude and politically incorrect here – which is actually quite difficult for me – and instead focus on three independent agencies I have met recently to illustrate my view.
Each of these agencies does very different things. One is a UK based branding consultancy focusing on packaged goods, the second is a creative boutique in Switzerland and the third a full service creative agency from South Africa.
Now on the face of it, an eclectic group of businesses but, when you meet them the thread of commonality becomes clear – they are all deeply passionate about what they do, and I don’t mean a glib ‘statement of beliefs’ line in the credentials. These guys have a passion for their chosen discipline, they get excited by it and importantly, they induce real excitement in others when they talk to them about it – the sort of excitement that makes your skin tingle when you understand what they are driving at and why.
This is rare… which is rather disappointing given our industry’s raison d’être is to excite, inspire and be creative in its broadest sense.
Without a doubt, these agencies ability to deliver this infectious passion is product of their owner’s drive and belief that they can do something different but, it’s also more than this. It’s about having the convictions to stand by your beliefs and be in an environment that allows this to happen. It’s about delivering ideas not mudded by internal agency politics. It’s about being independent and able to deliver what you believe to be the right solution for a client’s needs – and not necessarily just the one you know how to do. Incidentally, this is also the route to increased profitability – but that’s the subject of another blog ;-)
And this is the point, real passion of belief in our industry is rare and something to be cherished. It’s a mark of difference and can be a way to make more money. Its natural breeding ground is the independent sector where by the very nature of having to be, agencies are more creative, responsive and client issue focused.
So come on everyone, lets be passionate again - it’s time for a group hug!
Paul Squirrell 19th March 2010
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thenetworkone has setup this new blog where we will be posting our views on the world of advertising and marketing communications.
We look forward to receiving your comments.
