BrandKnew April 2020

Branding matters. Because branding matters.

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04.20#90

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10 Dear friends: Hope all of you and yours are safe and well. Over the past few weeks the entire world has gone topsy turvy with the carpet bombing undertaken by Covid 19 across the globe. Thousands of lives lost and even the best of infrastructure and admirable medical staff not being able to cope. Never before have we witnessed such extraordinary times with entire cities and countries in complete lockdown to neutralise the impact of the highly volatile contagion. As we all wage our battles to cope with this never before witnessed situation, there has never been a better time for both individuals and organisations to reflect, introspect and be more human than ever before.

As we get more digitally engaged brought about by social distancing and WFH(Work From Home), we have done our best to pack this edition with high value reading. During the Covid 19, Why are Marketers increasingly turning to Digital Marketing, we take a look. Seminal management guru Philip Kotler talks about Marketing’s Higher Purpose. We also take a peek into the Most Innovative Brands of 2020 and the Most Innovative Social Media Companies of 2020. Advertising connoisseurs will wade into the article ‘What makes an Ad Memorable‘ with consummate passion as Trend Guru Faith Popcorn talks about how Robots will Curate our Best Futures. Oft hyped AI has been put to the test where a growing number of marketers are talking about rejecting it based on a study conducted recently. The feature on the Six Stages of the Consumer Buying Process and How to Market to Them combines both Behavioral Economics and CeX in ample measure. We also pick up a conversation in this edition on How Digital are Millennials in their Shopping. There is ample more to gloat over and savor as we spend more time with our screens in the wake of the Corona Virus.

Before I sign off let me wish you and yours the very best. Stay safe, Stay well, Stay healthy! And ‘ keep safe distance ‘!

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Suresh Dinakaran @ISDGlobalDubai

@Brandknewmag

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Managing Editor: Suresh Dinakaran Creative Head/Director Operations: Pravin Ahir Magazine Concept & Design/ New Media Specialist: Mufaddal Joher Business Development Director: Rishi Mohan Brand Engagement and Outreach Specialist: Anuva Madan Country Head India: Rohit Unni Research & Analysis: Meeta Pendse Country Head, Australia: Norbert D’Souza Country Head, UK: Sagar Patil Performance Marketing Architect: Ryan Govindan Video Content Specialist: Vinayak Sivaprasad Revenue Generation Specialist: Nitin Kumar

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CONTENTS The Six Stages Of The Consumer Buying Process And How To Market To Them Philip Kotler On Marketing’s Higher Purpos The 10 Most Innovative Brands Of 2020 Why Companies Turn To Digital Marketing To Survive Covid-19 What Makes An Ad Memorable?

Your Fist And The Future Of Marketing ‘Robots Will Curate Our Best Futures’ Is Your Company Culture On Autopilot?

Data-Driven Decisions Are The Foundation Of Goodcustomer Experiences Marketing Spend Management Ai Rejected By A Growing Number Of Marketers, Study Says The Inevitable Collision Of Gaming And Athleisure The Lobster Mac ‘N’ Cheese Mystery: Why Brands Mix High With Low The 10 Most Innovative Social Media Companies Of 2020 How Digital Are Millennials In Their Shopping?

Brand Advocacy – The Most Powerful Route To Market Growth Pros & Cons: Conversational Ai And Chatbots Brand Disruption Study 2020: Direct Brands Go Mainstream Marketing Message Overload ‘Misbehaving’: When Psychology Meets Economics Book, Line & Sinker

THE SIX STAGES OF THE CONSUMER BUYING PROCESS AND HOW TO MARKET TO THEM

By Shane Jones

Far too often, retailers think that consumer buying is randomized. That certain products appeal to certain customers and that a purchase either happens or it doesn’t.

They approach product and service marketing in the same way, based on trial and error. What if there were a distinctive set of steps that most consumers went through before deciding whether to make a purchase or not? What if there was a scientific method for determining what goes into the buying process that could make marketing to a target audience more than a shot in the dark? The good news? It does exist. The actual purchase is just one step. In fact, there are six stages to the consumer buying process, and as a marketer, you can market to them effectively.

customer must have a reason to believe that what they want, where they want to be or how they perceive themselves or a situation is different from where they actually are. The desire is different from the reality – this presents a problem for the customer.

1.Problem Recognition

2. Information Search

Put simply, before a purchase can ever take place, the

Once a problem is recognized, the customer search process

However, for the marketer, this creates an opportunity. By taking the time to “create a problem” for the customer, whether they recognize that it exists already or not, you’re starting the buying process. To do this, start with content marketing. Share facts and testimonials of what your product or service can provide. Ask questions to pull the potential customer into the buying process. Doing this helps a potential customer realize that they have a need that should be solved.

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11 deciding whether to move forward with the purchase or not.

That’s right, at this point they could still decide to walk away.

This means it’s time to step up the game in the marketing process by providing a sense of security while reminding customers of why they wanted to make the purchase in the first time. At this stage, giving as much information relating to the need that was created in step one along with why your brand, is the best provider to fulfill this need is essential.

If a customer walks away from the purchase, this is the time to bring them back. Retargeting or simple email reminders that speak to the need for the product in question can enforce the purchase decision, even if the opportunity seems lost.

Step four is by far the most important one in the consumer buying process. This is where profits are either made or lost. begins. They know there is an issue and they’re looking for a solution. If it’s a new makeup foundation, they look for foundation; if it’s a new refrigerator with all the newest technology thrown in, they start looking at refrigerators – it’s fairly straight forward.

As a marketer, the best way to market to this need is to establish your brand or the brand of your clients as an industry leader or expert in a specific field. Methods to consider include becoming a Google Trusted Store or by advertising partnerships and sponsors prominently on all web materials and collaterals.

Becoming a Google Trusted Store, like CJ Pony Parts – a leading dealer of Ford Mustang parts – allows you to increase search rankings and to provide a sense of customer security by displaying your status on your website.

Increasing your credibility markets to the information search process by keeps you in front of the customer and ahead of the competition.

3. Evaluation of Alternatives Just because you stand out among the competition doesn’t mean a customer will absolutely purchase your product or service. In fact, now more than ever, customers want to be sure they’ve done thorough research prior to making a purchase. Because of this, even though they may be sure of what they want, they’ll still want to compare other options to ensure their decision is the right one.

Marketing to this couldn’t be easier. Keep them on your site for the evaluation of alternatives stage. Leading insurance provider Geico allows customers to compare rates with other insurance providers all under their own website – even if the competition can offer a cheaper price. This not only simplifies the process, it establishes a trusting customer relationship, especially during the evaluation of alternatives stage.

4. Purchase Decision Somewhat surprisingly, the purchase decision falls near the middle of the six stages of the consumer buying process.

At this point, the customer has explored multiple options, they understand pricing and payment options and they are

5. Purchase A need has been created, research has been completed and the customer has decided to make a purchase. All the stages that lead to a conversion have been finished. However, this doesn’t mean it’s a sure thing. A consumer could still be lost.

Marketing is just as important during this stage as during the previous.

Marketing to this stage is straightforward: keep it simple.

Test your brand’s purchase process online. Is it complicated?

Are there too many steps? Is the load time too slow? Can a purchase be completed just as simply on a mobile device as on a desktop computer? Ask these critical questions and make adjustments. If the purchase process is too difficult, customers, and therefore revenue, can be easily lost.

6. Post-Purchase Evaluation Just because a purchase has been made, the process has not ended. In fact, revenues and customer loyalty can be easily lost. After a purchase is made, it’s inevitable that the customer must decide whether they are satisfied with the decision that was made or not. They evaluate.

If a customer feels as though an incorrect decision was made, a return could take place. This can be mitigated by identifying the source of dissonance, and offering an exchange that is simple and straightforward. However, even if the customer is satisfied with his or her decision to make the purchase, whether a future purchase is made from your brand is still in question. Because of this, sending follow-up surveys and emails that thank the customer for making a purchase are critical.

Take the time to understand the six stages of the consumer buying process. Doing this ensures that your marketing strategy addresses each stage and leads to higher conversions and long-term customer loyalty.

I am an internet marketer, and a Consumer Behavior Blogger, who loves to write about business, the current economy, anything marketing, and SEO. I also am a Triathlete and Marathon runner and share all sorts of running advice and plans on RunningPlanit.

Philip Kotler on Marketing’s Higher Purpose

By Philip Kotler

From “shared value” to “brand purpose” to “social responsibility,” the business world has no shortage of concepts, guidelines, and frameworks for how to prosper while doing good. Companies today are quick to promote their own uniquely benevolent vision.

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But for Philip Kotler, professor of marketing at the Kellogg School since 1962, making a difference in customers’ lives is not a new proposition. In fact, this is the primary goal of marketing, a field he helped to shape—and one that still has a critical role to play in changing our world for the better.

In his new book, Confronting Capitalism: Real Solutions for a Troubled Economic System, Kotler advocates bold reform on issues ranging from minimum wage to environmental regulation. But he cautions against an overreliance on public policy expertise—the notion that all of our social problems require government intervention—and insists that marketing can help corporations make a positive impact on their customers and the world at large.

“Marketing and credit are the twin engines of capitalism,” he says. “Marketing convinces people to spend—so that demand is linked to supply—and credit allows them to borrow if necessary.” Today, with rising inequality, too many people are forced to borrow to meet their basic needs. This will change, he says, when workers are given enough pay to afford the goods that businesses produce. But marketing has a role to play, too. “Along with higher pay for workers, marketing with a higher purpose will also improve demand.”

From Tools to Purpose As Kotler sees it, marketing is not just advertising writ large.

Since the publication of Marketing Management in 1967 (now in its 15th edition), he has been at the forefront of the field’s evolution from providing a set of tools (including the famous four P’s and the concepts of segmentation, targeting, and positioning) to addressing deeper questions about customer goals and aspirations. He was one of the first to argue that companies should be customer-centered.

“Marketing has always been about understanding how customers behave, what they feel, and what they hope to achieve,” he says. The field has evolved from what Kotler calls Marketing 1.0, a simple appeal to homo economicus to show that a company’s brand functionally offered the best value for that market segment, through Marketing 2.0’s deeper understanding of the role that emotions play in customer decision making, to Marketing 3.0, which touches a customer’s higher nature and aspirations for community and compassion.

“Marketers economists.”

are

the

original

behavioral

In Confronting Capitalism, Kotler makes a case for this more enlightened form of marketing. He advocates a “customer-centric sustainability approach” to marketing— one that addresses customer needs but does not encourage overconsumption or environmental damage—and he urges companies to always consider the triple bottom line. “Have we arrived at an offer that is good for our profits, good for people, and good for our planet?”

It is a case Kotler has been making since 1971, when he and a colleague, Gerald Zaltman, took up a question first raised

by G.D. Wiebe: “Why can’t you sell brotherhood like you can sell soap?” The term “social marketing” was born.

“How do we help people to eat better, exercise more, quit smoking, say no to hard drugs? These are the sorts of

questions social marketing tried to answer.” Kotler—with coauthor Nancy Lee—developed this novel concept in Social Marketing: Changing Behaviors for Good, which describes how marketing techniques could be used to improve health, safety, education, and community building. “When you think about Bill and Melinda Gates’s work in Africa to eradicate polio and malaria, they are using the principles of social marketing to sell new and better behaviors to citizens in African countries,” Kotler says.

But the concept was eventually overshadowed by the rise of behavioral economics—a cross-pollination of psychology and economics that soon became the darling of the public policy sphere. Today, we talk about government policies “nudging” us towards better health, greener consumption, and cozier retirements, taking our cue from Richard Thaler’s seminal book, Nudge.

“The book made the point that much of consumer behavior is irrational rather than deliberate and thoughtful,” Kotler says. “But marketers have known this for over 100 years. So behavioral economics is nothing new. It is just another word for marketing.”

Marketers start by trying to understand the rational and irrational behavior of customers. Then they determine which features a product should have, how to make it broadly appealing, and how that product can contribute to improving the material, emotional, and spiritual well-being of customers. “In this sense, marketers are the original behavioral economists.”

Social Marketing and Demarketing As Kotler sees it, the great promise of social marketing is that it addresses social problems without encroaching on individual liberties. While it is true that public policy is an effective way to address such problems, Kotler thinks that corporations themselves should be the ones to encourage better behavior.

Take, for example, Michael Bloomberg’s attempts to improve the health of New Yorkers by reducing the size of soda cups and the visibility of cigarettes. Or consider the challenge of convincing people to use less water in California. Instead of the government explicitly outlawing certain behaviors, or even “nudging” them, social marketers could use Kotler’s 4P framework (product, price, place, promotion) to promote healthier or more sustainable alternatives. Social marketers could even engage in “demarketing,” a strategy Kotler pioneered along with longtime colleague Sidney Levy. The idea is that the same marketing tools that are used to promote consumption can also be used to discourage consumption for the sake of improving health outcomes or protecting the environment.

Many companies have already built sustainability into their thinking and planning. The outdoor clothing company Patagonia has endorsed sustainability by using recycled material and offering its customers free repairs on any clothing item. Kotler points to companies like Unilever—which internalizes the cost of carbon emissions and reflects that cost in its prices—and Timberland—which only uses suppliers who themselves are committed to sustainable business practice—

as exemplars of a growing trend.

For Kotler, these companies are going beyond mere corporate social responsibility. CSR usually involves maximizing profits and incidentally doing good for society. Social marketing and sustainable marketing, by contrast, require doing good in the very course of running the business. “I believe that companies should design their entire business model by thinking of what is good for their customers, employees, suppliers, distributors, and society as a whole.”

Better Marketers, Smarter Consumers Kotler is optimistic about the prospect that better marketing might help solve our social problems. With information about corporate behavior more accessible than ever before, customers are no longer passive agents in the marketing process. Increasingly, they have a role in driving corporate social change. “The ability to rank and rate companies and their brands is incredible now with the Internet,” Kotler says.

To take advantage of this shift toward customer empowerment, Kotler proposes implementing a Good Company Index

that would force companies to take seriously a new set of competitive factors.

In this Index, “we would assume that a company is good if it practices sustainability, pays a fair wage, and the CEO doesn’t get 800 times what the average worker gets,” Kotler says.

“That way, when consumers are deciding between two similar competing offers, they can choose to buy from the company that ranks higher on being good. The market shares of good companies would grow faster, creating a virtuous cycle. Over time, more companies would have to practice sustainability, pay a fair wage, and not overpay management if it wants its brands to be preferred. As Henry Ford recognized, if wage earners don’t share in growth, they will not be able to buy the goods and services that the business world produces.”

In this scenario, marketing would become what it was supposed to be: an engine for competitive growth by making life better for more people. In Confronting Capitalism, Kotler insists that marketing has the potential to drive the kind of growth that improves people’s lives without creating excessive inequality or damaging the planet. “Marketing with a higher purpose will improve our economy and society.”

THE 10 MOST INNOVATIVE BRANDS OF 2020

BY FAST COMPANY

When every brand is making noise, how do you break through? As this past year makes as clear as any, the brands that truly understand themselves have almost limitless possibilities to bring expression to that in a way that resonates with consumers. The brands we honor are varied in their businesses, but united in having figured out their core identity and having fun from there.

1. WHITE CLAW For riding the wave of hard seltzer’s rise by appealing to men, women, and memes The overall hard-seltzer market exploded last year, with a 202% sales boost over 2018 and hitting $1.3 billion.

And it was Mark Anthony Brands’ White Claw that led the way. It rode the wave of this rise with both a design and marketing approach that was appealing to men, women, and memes, making the most of events like the Kentucky Derby and Coachella, while embracing influencers and even unauthorized parodies.

Read more about why White Claw is one of the Most Innovative Companies of 2020.

2. AVIATION GIN For hilariously using meta advertising, pop culture, and Peloton’s misfortune to stand out in a crowded market Over the course of the past year, Ryan Reynolds has managed to raise the profile of Aviation Gin among drinkers while also placing the brand comfortably in pop culture. Part of that is sheer celebrity, but the work itself has also been the envy of every marketer and ad agency. Using meta-advertising to pitch Aviation, Samsung, and a Netflix film—all at once— was impressive, but it was how the brand managed to find and hire the Peloton Wife for an ad while the viral flames around the exercise brand were still burning that really had everyone buzzing.

3. POPEYES For cooking a new spicy chicken sandwich into a social media phenomenon

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Although it’s been accustomed to being the third wheel of fried chicken (after KFC and Chick-fil-A), Popeyes upended all the rules when it introduced its new chicken sandwich last summer. In the process, it somehow managed to become a piece of pop culture. A huge part of that was thanks to the discourse on Black Twitter, which started hilarious memes and stoked the conversation. From there, Popeye’s new marketing team—stocked with vets from fellow Restaurant Brands International sibling Burger King—managed to use a witty social voice and the existing cultural hype to turn a sandwich into a situation where if we say The Great Chicken Sandwich War of 2019, you know exactly what we’re talking about.

4. MOUNTAIN DEW For turning an apology to the Upper Peninsula of Michigan into a golden opportunity The soda that gave us Puppy Monkey Baby had another successful Super Bowl blockbuster by inexplicably combining Bryan Cranston, Tracee Ellis Ross, and The Shining, but it was a lower-profile effort that really showed off its marketing chops. When a map that was part of the brand’s “Dewnited States” campaign launched in June, it mistakenly put Michigan’s Upper Peninsula in Wisconsin. As expected, it was roundly called out on social media. But instead of ducking and hiding, the Dew decided to double down on an apology and give the UP its own special-edition bottle labels, then set up camp at the Upper Peninsula State Fair to atone for its geographical sins by giving attendees the chance to plop Dew employees in a dunk tank, all while giving away thousands of free products and swag.

5. FNDR For helping brands like Glossier, Snap, Farfetch, and Daily Harvest find their voice This was the year Fndr cemented itself as a go-to adviser for an elite cadre of entrepreneurs. The secret sauce is how they help startups hone their stories by putting founders through a series of meetings designed to tease out their values and beliefs, challenging them to think about the human impact of technology and the social contract between their companies and the communities in which they operate.

6. PATAGONIA For empowering teen activists to challenge government climate change deniers The outdoors brand has been making compelling content and lobbying for years, and this last one was no exception. To raise awareness for Climate Week back in September 2019, the brand created a new campaign featuring teen activists from around America and the world, telling Congress and other leaders that there is no room in government for climate change deniers. By early 2020, the brand had released two new films, the first a feature documentary called Public Trust, about America’s system of public lands and the fight to protect them. The second was a compelling short called District 15, outlining the fight by young activists in the L.A. neighborhood of Wilmington to establish a 2,500-foot distance between oil drilling operations and the community’s schools, hospitals, and churches.

7. NETFLIX For getting Burger King, Coca-Cola, Nike, and BaskinRobbins to hype Stranger Things The third season of Stranger Things was a massive event for Netflix, and even though the streamer has no advertising on its platform, it turned the occasion into a blockbuster moviestyle brandfest. The best part about it—across partners like Coke, Nike, Baskin-Robbins, Lego, and many more—was that each execution fit the tone, personality, and content of the show. The crown jewel? Convincing Coca-Cola to relive its New Coke disaster and turn it into a marketing masterstroke.

8. IKEA For embracing weirdness, from its catalog of TV-show living rooms to its grime diss track Christmas ad Always a strong contender, the Swedish retailer continued its years-long run of prolific and fun marketing from around the globe, turning the TV living rooms from Friends, The Simpsons, and Stranger Things into a cheeky furniture catalog, and making a UK Christmas ad into a grime diss track rapped by house trinkets.

9. PROCTER & GAMBLE For deploying its massive budget to provoke with The Look and the docuseries Activate As one of the world’s largest advertisers, it’d be easy to blow off P&G as the opposite of risk-taking. But over the past year, the company has used its size and influence to push the boundaries of what high-quality brand content could— and should—be. In mid-2019, it announced Activate, a sixpart documentary series on National Geographic Channel, featuring celebrities such as music producer Pharrell Williams, rapper Common, and actors Darren Criss and Uzo Aduba, on issues like the work of grassroots activists ending cash bail, eradicating plastic pollution, and more. Then in November 2019, building on the momentum from awardwinning short film work like 2017’s “The Talk” and 2018’s “The Look,” the company teamed with Spotify for a four-part branded podcast called Harmonize, on racial bias starring John Legend and Pusha T, along with cultural commentator Cory Townes, and hosted by writer Jamilah Lemieux.

10. ADIDAS For converting social influencers into sneaker salespeople with its e-commerce app The sports giant has a rabid fan base, and in mid-2019, it decided to experiment in incorporating them into the company’s sales funnel with a new partnership with the social commerce app Storr. The arrangement gives people the ability to open their own sneaker store from their phone in just three clicks. First opened up to the brand’s 10,000 Creators Club members, who could earn a 6% commission from every sale (or have the option to donate to Girls on the Run), the plan was then to expand social selling into the brand’s higher-end women’s products.

Why Companies Turn To Digital Marketing To Survive COVID-19

Why Companies Turn To Digital Marketing To Survive COVID-19

By Bernard Marr

In the coming months, businesses are going to become more reliant than ever on their digital strategy. Without wanting to sound too alarmist, in many cases it will be the deciding factor in whether they make it through the tough times ahead.

The unprecedented, almost-total disappearance of all channels related to live events and conferences, and the increasing barriers on face-to-face business, pose an enormous challenge. Key to resilience is the development of ongoing contingencies to mitigate against this loss. B2B companies in particular rely on the annual circuit of trade shows and exhibitions to network and build customer relations. In industries that are not digital-native, they may also be less sophisticated in their digital growth and customer relations strategies. For smaller businesses especially, used to getting new customers through word-of-mouth referrals or on the strength of a hard-won reputation, their loss is coming as a shock. Larger companies are also now finding themselves in the position of having potentially lost millions through cancelled events. They won’t claw back the hours of time and expense spent on preparations for this year, but insurance and flexible cancellation policies will leave them with marketing budget to reassign. Digital is likely to be the clear winner here, and companies – including ones that may not so much as had a Facebook page before – will need to move into social marketing, content marketing, SEO and influencer-led campaigns.

Of course, this means there’s opportunities out there for the taking, if you are a B2B supplier in an industry that has been slow to adapt to digital marketing. A key factor in resilience is adaptability. If it’s standard in your industry to go out and meet new customers face-to-face before you do business, adapting may mean opening new channels over web or social media platforms where introductions can be made and relationships fostered. In the coming months, your prospective clients are going to be less open to the idea of letting you walk through the door and shake their hand – and no-one really has any idea how long this will last and whether this will lead to longer-term change.

As Scott Jones, CEO of 123 Internet Group, told me “We are in uncertain times, but with the increase of remote working and a collaborative approach, companies are turning to digital channels and embracing the transformation. We have seen a real spike during the last few weeks from companies wishing to create or update websites, launch new e-commerce channels and create social media campaigns focused on home-workers and a real focus on using influencers and SEO to reach new audiences.”

Being confined to the office – or even the home – rather than on the road on sales visits or at events, means marketers have more time to develop digital strategies. This means researching where your customers can be found online, and how different approaches and tactics might impact your success. If your organization previously put token efforts into digital channels – because like a lot of other businesses, you had built your networks offline and that had always seemed to work – now is the time to revisit them. That could be as simple as giving your website and social pages a refresh, or a more innovative approach.

Ratnesh Singh, head of global business at events technology agency Buzznation told me that he found out quickly that clients did not want to lose the networking opportunities provided by the conference circuit. On top of this, they are looking for new ways to spend their remaining marketing budgets. He said, “With our corporate clients, events often consume 50 to 60 per cent of their marketing budgets. They still want to spend that money and they are open to trying something new.

“There’s a window of opportunity here – when things are back to normal budgets will be going back into live events and that’s what they will be spending their time on.

“But if they see the benefits and opportunities that digital channels can offer, this will become part of their long-term marketing contingency plans.”

As well as offering immersive 3D virtual events, Buzznation has also found that businesses wanting to become more sophisticated in their use of live social platforms. Singh said “Clients are turning to Facebook or LinkedIn Live. Often these are platforms they have dabbled with in the past but never fully integrated into their marketing strategy. Now they see value in partnering with companies like us that know how to help them make the most of these channels, to achieve better production values and more targeted campaigns.”

It’s certainly true that the coming weeks, or months – or however long this situation lasts – will be a challenging time for any company that isn’t ready to think about how they will replace the opportunities that have been lost.

As long as businesses approach the shift to digital marketing strategically, there’s no reason why it should just serve as an emergency fill-in, but could carry on providing long-term value when the world eventually gets back to normal. And of course, it would make companies more resilient to deal with any future pandemics.

WHAT MAKES AN AD MEMORABLE?

By Bob Hoffman

The great Mark Ritson had an interesting piece in UK-based Marketing Week this week about the elements in video spots that make them memorable.

Study after study indicate that the vast majority of ads are either not remembered or incorrectly attributed. In the study Ritson quotes, done by Ipsos in the US, 84% of spots are either not remembered or not attributed to the advertiser.

As you will see in the next chart, the above chart demonstrates that most advertisers don’t know shit. If you are like most advertisers, you believe that two of the most important elements in making the ad memorable are the brand logo and the slogan (which probably accounts for the ubiquitous cry “make the logo bigger.”) According to the study, these are the two least effective elements. Here are the results of the research.

Before we get to the conclusions, let’s play a little game and test your insight. Rate the following “distinctive brand assets” in terms of their ability to make an ad more memorable: • Logo •

Slogan

• Characters • Celebrities •

Audio cues

• Typography • Music • Package shape • Color According to the study in question, this chart shows how advertisers use brand assets and is probably a reliable indicator of what most advertisers see as a hierarchy of ways to make their advertising most distinctive and memorable.

According to the study, the most effective “brand assets” in making the spots more memorable are audio cues (“sonic brand cues”) and characters. In both cases, these elements are utilized by a tiny minority of advertisers.

Before we put too much credence in this study and start producing spots with cartoon monkeys who fart out a melody, let’s remember a few things.

1. Memorability and effectiveness are not the same thing.

Yes, memorability is probably a significant element in ad effectiveness, but it is not synonymous with it. There have been plenty of highly memorable spots that have failed bigly.

2. The most important element of an ad’s success is not covered in this research. It is the power of the story the spot tells. This is difficult to quantify and rarely shows up in studies like this.

Your Fist and the Future of Marketing

By Jonathan Martin

Are your marketing dollars worth the interruption? Since the dawn of time, marketing focused on one thing: finding a way—any way—to interrupt whatever you’re doing, and, for a moment in time, have you pay attention to us. Through a combination of interruptions, reach and frequency, our ideas slowly become your ideas. The brain is an infinitely impressionable object, and through this kind of neural programming, marketing has spread their gospel.

So here’s the rub. As marketers compete for attention, our

B2B marketers like us had decades to perfect the craft of interrupting people. From telemarketing calls, to unsolicited emails, or a billboard on the side of the road, we’ve become really good at interrupting people and grabbing their attention, even if just for a moment.

processed.

If you live in a rural area in the United States today, you can expect to be exposed to over 2,500 marketing messages every day. Should you live somewhere like Time Square, your poor brain will get spammed by 13,000+ messages from well-meaning marketers. How are you supposed to process all of that? It’s overwhelming.

traditional interruption-based marketing methods are simply

Brains are the original “smart” devices and they found novel ways to solve the problem of being flooded by your interrupts: Our brains are like a clenched fist.

with a number closer to 100%.

To demonstrate, clench your right fist, tucking your thumb under your fingers. Take a good look, as your fist now represents the key three aspects of your brain’s function (and the future of your marketing career).

Your wrist depicts the lower orders of the brain, or The Reptilian Brain. It’s the oldest part of the brain which does all the regulatory functions like moderating our body temperature, pumping blood and releasing hormones.

Your thumb represents the Limbic Brain, also known as the Mammalian Brain, which is responsible for how we process and feel emotions.

The highest order of your brain is called the Neocortex (represented in our “handy” model, by your fingers), which is involved in sensory perception, cognition and language. All three layers of the brain are connected with information and commands flowing up and down between the layers.

brains begin to feel overwhelmed from the hundreds and thousands of interruptions. Neuroscientists believe that the fight-or-flight mechanism in the Reptilian Brain gets triggered and begins actively filtering out marketing messages. Long story short: all that budget that you’re applying to your new attention-grabbing campaign is going to go to waste. The Reptilian Brain stops your interruptions before they can be

Despite this, marketers continue to spend billions of dollars every year putting shampoo commercials in the middle of irrelevant television shows and wondering why they’re not as effective as they used to be. The tools and techniques built on getting less and less effective with every passing quarter.

For a moment, think about the marketing programs and activities you are driving, and how many of them are based on trying to grab the attention of your audience? Is it 50%, 70%, 90%? I’m guessing that many of you are coming up

Yet we continue to invest.

Are your marketing dollars working hard enough if the majority of your investment gets filtered out by our Reptilian Brains?

Over the last few decades, we’ve managed to convince ourselves that poor program marketing performance is good enough. It’s not.

The age of interrupt-based marketing is rapidly coming to an end. In fact, the age of marketing as we know it is coming to a close and will soon be something completely different. We can no longer depend on interuptions to attract customers to our marketing campaigns. Developing a strategy beyond interruption, reach and frequency is the only way to stay ahead of the game in the new age of marketing.

Jonathan is responsible for the global strategy and execution of all aspects of marketing at Hitachi Vantara.

Self-described as a career CMO, Jonathan’s passion is to drive a progressive approach to B2B marketing at the intersection of metrics and magic.

‘Robots Will Curate Our Best Futures’

By Renuka Methil

Renowned New York-based futurist Faith Popcorn was in South Africa recently when she also spoke to FORBES AFRICA about the trends that will shape the future. Here are some of her mind-boggling predictions.

She is the TREND-SPOTTER who famously coined the word ‘cocooning’ in 1981, and got most of her predictions right.

Faith Popcorn was in South Africa in November at a Virgin Atlantic and Investec event titled ‘Business Is An Adventure’.

As the founder & CEO of Faith Popcorn’s BrainReserve, a future-focused trend consultancy, she applies her foresight to reposition established brands and create the products and services of tomorrow. The best-selling author lives in Manhattan and Wainscott, New York, with her two Chinese daughters. We ask her to tell us more: What are the Top 5 trends for the future?

Being Alive: We are a wellness-obsessed culture – it’s our way of feeling in control in an out-of-control world. The era of the ‘quantified self’ means we can parse our biometric data to find out exactly what will optimize our health, and emotional and spiritual wellness are becoming critical. Tech and AI – ‘embeddables’, ‘swallowables’ and AI – will anticipate our needs and help us achieve optimal health. A little chip will sense, ‘oh, bad mood coming… let me dose you with CBD or change your brainwaves to get rid of that’.”

Save Our Society and AtmosFear: This pairing of trends recognizes that our planet is in peril – beyond peril, it’s dying – and says we must do anything and everything to save it.

Values are the ‘new value’. No person, brand or business can survive in the coming years without a commitment to heal our earth. If that means solving for fossil fuels or building an asparagus farm on Mars – just do it.

EVEolution: I thought this would have accelerated beyond where it is today, but in the years ahead, it will be absolutely primary. The biggest wealth transfer in history – over $20 trillion – will mostly benefit women. Women are earning more degrees than men at every educational level, are starting businesses at two times that of men and refusing to put up with oppression – look at #metoo and #timesup as the seeds of this. In the future, the discussion won’t be about parity and closing the gender gap. It will be about women superseding and leading men.

Vigilante consumer: If you thought the consumer was already at its peak demanding accountability and transparency, brace yourselves. Companies will have to divulge everything. Your consumer will demand to know about your inclusivity policies on staff; what your political values are; they will know your recycling and plant-friendly policies in full detail – and when you’re green-washing. Many conglomerates will flounder and fail due to this… and disruptors will be waiting to dive in and take their business.

What do the terms ‘gender fluidity’ and ‘genderfree’ mean to you?

Gender fluidity means the person, regardless of what gender they were assigned at birth, feels that their identity fluctuates from the old, binary norm. So maybe you are a man who one day feels feminine, wears earrings and nail polish; another day, you feel macho and wear a suit. Or maybe you feel somewhat feminine all the time… but you do not adhere to the old-school gender norms. This is not about sexual orientation, to whom you are attracted. It’s about how you feel in your own skin, relating to the world. Gender-free is the response to gender fluidity. It’s why P&G removed the female Venus symbol from menstrual products to be inclusive of trans-men. It’s why Mr. Smith makes haircare for all; Jecca makes cosmetics for all; and the Phluid Project in New York sells clothing for all. Doesn’t matter what your chromosomes say – express yourself however you like. I think we need to stop thinking of the ‘male’ and ‘female’ product aisles and recognize a third, gender-free aisle will soon rise and take their place.

How will robots evolve?

Right now, robots are fairly limited and clunky. They are not the intuitive, anticipatory, seamless partners, friends, advisors and care-givers they will be soon. Their form will become miniaturized and ultra-mobile, with articulated limbs that can complete all kinds of chores. Thanks to AI and what i call Emo-Surveillance (they will read our expressions and body-language cues), they will be able to comprehend our moods and respond before we articulate our needs. IoT and biometric data will let them know if we are stressed, sad or sleepy, and they will be there with a kind word, an elixir, a pep talk, a nap programmed with a fabulous, uplifting dream. They will become the curator of our best futures.

Is Your Company Culture on Autopilot?

By Michael Xenakis

For startups, the early days can feel exhilarating, even romantic: a handful of dedicated employees all focused on an original idea, solving problems as they arise and growing the business in the process.

But with that growth comes a range of leadership challenges— ones it can be easy to overlook until it is too late.

“You can wake up one day and realize, ‘Wow, there are a lot of rumblings in the organization,’” says Michael Xenakis, an adjunct lecturer of innovation and entrepreneurship at Kellogg. “And you go from ‘we’re fine’ to ‘we’ve got a real issue.’”

Xenakis, whose 16 years of experience as an executive at OpenTable included helping to take the company public in 2009, shares three tips for leading a rapidly growing organization.

Invest in Human Resources Early Startups tend to hold off on investing in a dedicated humanresources function as long as possible, instead handling recruitment on an ad-hoc basis.

“You feel like, ‘Oh, it’s not needed. We’re such a small organization. That’s added head count, added compensation,’” says Xenakis. “You think, ‘We just need to put our heads down and work.’”

Similarly, management training tends to get short shrift— despite early employees often overseeing quickly growing teams without having ever managed anyone before.

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27 In Xenakis’ view, the longer a team delays building a dedicated human-resources shop that can handle these tasks, the greater the chance that the company will experience employee-retention issues.

“Suddenly the head of engineering is saying, ‘I’m down to eight people, and I’m struggling to fill an open position, and now we’re going to have to push back some of these release dates,’” Xenakis says. “And the head of sales is giving you a story about not hitting numbers because there’s head count that disappeared.”

For instance, it was almost a decade before OpenTable hired a senior manager to oversee HR, Xenakis explains.

That manager was eventually promoted to the director level, but Xenakis believes she should have been a member of the executive team much earlier: a good senior leader in HR would have had the bandwidth to research compensation at comparable startups, get a pulse internally on employee satisfaction, and act to address retention issues before they hurt the bottom line.

“Early on, you really have to have that senior person who has both the experience from other companies and the credibility from sitting on the executive team, to be a strong voice,” says Xenakis.

Don’t Get Too Attached to Your Original Team One way leaders in young companies reward loyalty is by retaining and promoting employees who dedicated themselves to the company early. And there is certainly value to institutional knowledge and continuity.

But as a startup matures, its needs change: it’s unlikely that the team a founder starts with will have the exact skills and expertise as the team that should run the organization when it has tripled or quadrupled in size.

“At each stage of your company’s growth, you need to pause and ask, ‘What’s the right structure? What are the right personnel to give us the best chance of success?’” says Xenakis.

He points out that, at some point, you may be giving someone responsibilities that outpace their current abilities. For instance, individuals with high levels of functional expertise often fail to transfer that into management acumen.

“At each stage of your company’s growth, you need to pause and ask, ‘What’s the right structure? What are the right personnel to give us the best chance of success?’”

Xenakis also observed this issue at OpenTable, when an internal hire faltered. “We finally had to make a change, as painful as it was,” Xenakis says. “The day we brought in a seasoned, senior Chief Technology Officer was like a huge ‘a-ha’ moment for us.’”

The new CTO understood how to separate and manage out underperforming employees. He also established new

processes that decreased the number of times OpenTable released products with bugs.

“It was a lesson of, ‘Wow, we should have done this a year ago,’” Xenakis says A growing company should take the same approach to its board of directors, Xenakis notes, by revisiting its makeup periodically to make sure its composition is as beneficial as can be at that stage. For example, a startup might load its board with people who have experience launching other businesses or people who have ties to venture capital. As it matures, the same company might lean on the expertise of people with deeper experience in finance with public companies.

Be Thoughtful about Staying an Attractive Place to Work At most startups, the culture initially flows from the founders and earliest employees, Xenakis says. When new employees are brought in, they tend to mesh well with the founders both for skills and personalities because they are being hired directly by those same company leaders.

But as companies grow and more people join—while early employees leave—maintaining a coherent culture requires effort.

“You have to acknowledge that culture is important,” he says.

“And then ask yourself, ‘How can we try to maintain those things that make us a unique organization that people are excited to work for?’”

For instance, a few years after the founder left OpenTable, senior leaders who had been at the company for years formed a culture committee. The committee’s job was to identify ways to bring employees together—whether by reviving older, abandoned team-building strategies or by adopting new proposals. Out of that came several traditions, including skits at company meetings, theme-based happy hours, and Halloween costume competitions.

But being thoughtful about culture is not the same as maintaining the early culture at any cost. With more people and more hierarchy, more structure is required. This naturally changes the culture—which may be met with resistance by employees, particularly those who are used to the more freespirited early days.

That’s why it is important to make any changes transparent to all employees.

When Matt Roberts took over as CEO of OpenTable in 2011, he rolled out a new mission statement, which stressed the human connections the company makes between restaurants and diners. This helped employees to think of OpenTable as more than just a software company. Before long, employees started talking about “what can happen around the restaurant table” in their emails, department presentations, and customer visits.

“This wasn’t forced—it was organic,” Xenakis says. “When you do that, your culture starts to serve as that thread that continues on even as employees leave. So, for us, it was critical to invest the time to create that rallying cry and build in continuity as people were coming and going.”

Data-driven decisions are the foundation of goodcustomer experiences

By Rodney Weidemann for SAS Institute

TO STAY RELEVANT, ORGANISATIONS NEED TO USE DATA-LED INNOVATION TO DRIVE BETTER DECISION-MAKING AND KEEP CUSTOMERS AT THE CENTRE OF THEIR BUSINESS. In the modern, increasingly commoditised world, customer service is considered a key differentiator. In other words, those businesses that build and nurture relationships with potential and existing customers, and focus on putting the customer at the heart of their organisation, will be the ones to take the lead in the near future. Moreover, they will experience an increase in customer lifetime value and a reduction in churn.

According to SAS Senior Vice President Riad Gydien, appointed to lead Europe, the Middle East and Africa region (EMEA), as a growing number of companies look to implement digital transformation, this focus on customers is changing the role of enterprise software providers. These enterprises are being forced to shift from being mere ‘box droppers’ to adopting a more advisory and consultative relationship with customers, focused specifically on business outcomes.

“In the end, corporations will need to rethink their customer ecosystems if they truly expect to keep pace with both technology evolution and increasingly empowered consumers.

Remember, though, that a customer-centric company is one that offers more than just good customer service. It is, instead, a business that focuses on creating a culture around the customer and their needs. To this end, companies will essentially need to realign around a customer-centric vision that encompasses everything from sales to deployment, training and value creation,” says Gydien.

“The key to success for customers lies in the perfect alignment of technology, education, support and services. If these areas all dovetail together perfectly, they will provide a seamless and exceptional customer experience.”

Gydien adds that it is also worth noting that customer-centricity is widely considered to be the most important characteristic required in order to establish a truly ‘digital-native’ culture.

“Data-led innovation is changing the world, and deploying tools such as analytics is critical if the goal is to drive better decision-making across the enterprise. With this in mind, the new role of enterprise software providers is to support customers as they undertake their digital transformations.

“This means being focused on helping customers to apply the most advanced analytics, artificial intelligence (AI) and machine learning techniques available in order to help solve their most critical business challenges.”

Naturally, as the customer organisations move farther along their digital transformation journeys, continues Gydien, they increasingly come to understand that their investments must focus on more than just the data and technology itself, and should actively generate value creation. A good example here would be how data scientists used to be evaluated on the number of algorithms they could create, whereas today, their influence is more likely to be measured by the business outcomes these algorithms support.

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“Modern customers are facing some incredible challenges: the explosive growth of data, the need to drive near-real-time decisions at massive scale, a multitude of rapidly emerging technologies and a seemingly insurmountable skills gap. If data scientists are to remain relevant, they must undoubtedly develop the ability to sense, understand and respond to changing market conditions and customer expectations with both speed and agility.

At the end of the day, suggests Gydien, the right customer

“To gather the intelligence they need, the enterprise has to put the customer at the core of every decision it makes, and combine this approach with customer relationship management (CRM) and advanced analytics. This will enable them to collect a wealth of data, thereby obtaining a full 360-degree view of the client, which can then be leveraged to enhance the customer experience. This can be done through a clear understanding of customer buying behaviour, interests and engagement, and will allow the business to identify opportunities to create products and services for its best customers.”

customer experience and journey, as well as the supplier’s

intelligence will guide, inform and advise business leaders, enabling them to make the most informed decisions. Such intelligence can even provide additional business value, when it is shared with partners or used to secure new partnerships.

“However, it must be remembered that customer intelligence is only worth anything if it can, in turn, be transformed into the kind of customer insight that is utilised to enhance the sales, service and profits,” he says.

“It is SAS’s view that it is for the above reason that enterprise software providers simply have to work closely with customers to help them go from data to analytics to decisions, and to equip business leaders and data scientists for the future.

After all, by helping these players to better understand their customers on a granular level, they will enable these companies to ultimately make more intelligent business decisions,” concludes Gydien.

MARKETING SPEND MANAGEMENT

By KPMG Team

CMOs need to work with their finance and procurement counterparts to understand the factors that optimize marketing spend and increase return and efficiency.

There was a time when marketing spend was able to keep pace with market needs. Not anymore.

With customer demands increasing, technologies evolving, and the number of marketing channels proliferating, it has become very difficult for marketing to meet its operational goals while staying on budget.

It hasn’t helped that marketing budget growth has stalled.

Marketing spend fell from a high of 11 percent of company revenue in 2012 to 7.3 percent in 2018. The decline is expected to deepen in 2019, just as outsourcing of marketing activities is poised to increase by 5 percent.[1] This is all happening during a period when firms are focusing on market penetration strategies to drive growth, making maintaining a consistent, relevant presence and voice in the market even more critical and challenging.

This perfect storm of events—declining marketing budgets, increased reliance on external partners, the need for a consistent brand presence—means CMOs need to extract maximum value from every dollar of marketing spend.

While CMOs understand and actively manage the intricacies of customer-facing or working marketing spend, they often do not focus enough attention on vendor and material management activities, which\ can significantly inflate marketing costs. To manage marketing spend more efficiently, CMOs need to work collaboratively with their finance and procurement counterparts to understand the factors driving

marketing costs and where they can become more efficient.

By working together, they can ensure the firm gets the most from its marketing budget.

The challenges to managing marketing spend Managing marketing spend can be a highly complex task. Often, there are multiple buyers within a marketing organization who deal with dozens of different vendors and agencies over the course of the year. Global firms can deal with hundreds of different vendors and agencies each year.

Additionally, agencies of record can subcontract specialty vendors on behalf of their clients.

With so many vendors providing services, transparency of spend decreases, which can and has led to abuse by disreputable suppliers. For example, the Association of National Advertisers (ANA) reported finding agencies getting kickbacks and nontransparent rebates from media companies. Even with reputable vendors, there are always questions as to whether marketing got what it paid for with media and creative purchases (reach, frequency, hits, etc.).

Surprisingly, despite the current complexity and opacity of today’s media markets, there are still firms that do not conduct regular audits of media to ensure the schedules and contractual performance standards are met.

Just as concerning, most marketing organizations have not documented performance standards for their vendors.

If standards do exist, they are often different by brand or geography. Global marketing vendors can be held to multiple

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performance standards for similar work within the same firm. All of these lead to confusion and increased vendor administrative costs, which get passed on to clients.

of companies that expect to grow by 25 percent or more reported frequent or ongoing collaboration between the two functions.[2]

When the global financial crisis hit, many firms turned marketing sourcing over to the procurement group to drive cost efficiency. This singular focus on cost cutting led to poor quality work and complex, slow negotiation processes, which delayed decision making. The result: a negative impact on performance. This led many organizations to return marketing sourcing back to brand teams. PepsiCo did just that when it found that global procurement did not allow its marketers the agility to react in a fast-moving and ever-changing digital environment. The entire experience has left many marketers uneasy when it comes to working with procurement — further complicating the collaboration necessary to best manage marketing spend.

By working collaboratively with their CFO, finance, and procurement departments, a CMO can identify and better leverage internal knowledge and best practices related to procurement, vendor management, and contracts management. For example, the CFO can help the CMO assess whether they are paying competitive rates for specific services and set up processes to better track delivery of services against a contract to ensure terms are completely fulfilled. As primary steward of overall performance (balancing revenue and cost), the CFO is in a position to help marketing and procurement find the balance necessary to work together effectively.

Many finance processes also create challenges for marketing.

For example, the purchase order/ purchase requisition process in many firms is slow and cumbersome. This has led many marketers to establish blanket purchase orders, which make identifying costs by campaign or tactic difficult.

By working together, the CMO and the CFO can ensure that decisions related to marketing spend reflect both good fiscal management practices and the unique needs of a function that must be responsive to changing customer and market demands.

The advantages of collaboration between the CMO and CFO A survey of 200 marketers to benchmark the industry’s performance linked collaboration between marketing and finance as a key driver of growth. For example, 57 percent

Tighter management of marketing spending doesn’t mean falling behind the competition. In today’s world, customer expectations are changing rapidly.

If a company wants to remain relevant, its marketing function must be flexible, agile, and able to respond quickly to shifting trends. Collaborating with their CFO, finance and procurement functions can help CMOs manage budgets to ensure effectiveness and efficiency.

Getting off to the right start Increasingly, CMOs will be required to do more for less.

Collaborating with finance and procurement will be critical if marketing is to drive optimum value from marketing spend and deliver on strategic objectives.

This collaboration begins by understanding what each function brings to the table.

1. Repair the relationship

marketing

and

procurement

The CFO has a role to play in helping to set the right KPIs for measuring marketing procurement and performance.

These metrics need to strike the right balance between cost containment and revenue generation. While establishing shared metrics have been shown to improve marketing sourcing effectiveness, only 49 percent of firms report closely matched KPIs.[3] Once a balanced scorecard of marketing procurement metrics has been established, they need to be tracked and reported.

This may require finance, marketing, and procurement to work together to establish new data capture and measurement processes that ensure the value of marketing procurement beyond cost reduction can be identified.

2. Create a plan to source marketing services strategically Once marketing identifies what should be done in house and what should be outsourced to marketing services suppliers, marketing, finance, and procurement should come together to establish an external sourcing strategy. This will involve identifying the right supplier for specific tasks. For example, less complex and lower impact creative could be sourced to lower cost offshore vendors. The overall strategy should be designed to reduce the complexity and number of agencies and vendors while not sacrificing creative quality.

3. Decide on the right marketing procurement structure There is no one-size-fits-all strategy. Unilever recently restructured to three separate marketing procurement teams that will serve different divisions of the business in order to “drive long-term shareholder value and provide increased flexibility, strengthen corporate governance and enable our divisions to better serve consumers by balancing scale and agility.”[4] The best marketing sourcing structure should consider spend efficiency/effectiveness, marketing impact, the agility and speed required by marketing, while also taking advantage

of scale to reduce supplier prices. Clearly defined roles and responsibilities for procurement and marketing are required to achieve these goals. Once the right structure is identified, the CFO should review finance processes to ensure they assist in effective, transparent purchase and management of marketing suppliers.

4. Establish a robust yet balanced process for evaluating vendors To be most effective, this evaluation methodology should balance marketing’s desire for creativity, agility, and flexibility with business essentials, such as competitive rates, contractual fulfillment, and measurable market impact. If procurement is managed separately from finance, a CMO should work collaboratively with both the CFO and procurement to embed best practices for vendor management in day-to-day marketing practices. For example, performance standards should be set enterprise-wide based on the responsibility of the marketing services vendor and shared with the supplier before contracting, not after the fact.

5. Ensure supplier compliance Audits should include contract compliance as well as price benchmarking. Companies that have established regular audits of media and marketing contracts report finding the process very valuable. This is particularly true of digital and social media buys, where the veracity of reported performance is in question.

The CFO’s experience with financial and internal audits places him or her in the best position to manage the marketing/ media audit process and confirm that marketing suppliers are meeting performance agreements while also observing all relevant regulations, such as GDPR and Sarbanes-Oxley.

Getting the most out of marketing spend In today’s business world, marketing functions need to get the most from every dollar they spend. By working collaboratively, CFOs and CMOs can ensure they are managing their marketing spend in ways that are more efficient without compromising on the need to be agile, creative, and responsive. This will only lead to a more successful company overall.

AI rejected by a growing number of marketers, study says

By Dianna Christie

Dive Brief: • Half of advertisers (50%) have no plans to use artificial intelligence (AI) in their marketing, according to the results of a survey conducted by Advertiser Perceptions that was shared with Marketing Dive. That number is up from 36% in April 2019, when the company conducted a similar survey.

• In order of priority, marketers embracing AI use it for: advanced customer segmentation, media selection and buying, smart customer engagement, scaling marketing efforts and resetting objectives based on results.

• AI’s role in creating ads is small but shows signs of growth, with 20% using the tech only for campaign strategy, 42% to customize existing creative and 38% saying it is inevitable they will use it to create original ads. The majority (60%) use AI to develop banner ads, 54% for social media posts, 45% use it for digital outof-home campaigns and 36% for TV and connected TV video ads.

Dive Insight: AI gets a lot of lip service in the marketing world as an important but new technology, but this latest report from

Advertiser Perceptions suggests AI may be more hype than reality for many marketers. Instead, the pioneers for using AI in marketing remain brands with big budgets, such as Ikea and Sephora.

One reason for marketers moving slowly to embrace AI could be that there is no central authority within organizations to oversee the tech. Among those firms using AI for marketing, only 27% are in charge of the technology. The CTO heads up AI in 7% of companies while a CIO, director or IT department each manage AI in 6% of companies. Of those managing AI, 58% are involved in media selection and buying.

Marketers expect how they use AI will evolve as they become more comfortable with the tech, according to the survey. But by 2022, marketers expect media selection and buying to be their top use of AI, followed by creative ad development, advanced customer segmentation, smart customer engagement and augmented marketing analytics.

The latest Advertiser Perceptions report supports findings from another recent report from Bynder which found that 77% of marketers are concerned about how automation and AI will affect branding. The 2020 State of Branding Report found that 56% of surveyed marketers think AI could negatively affect their brands by diminishing creativity, reducing jobs or impacting differentiation.

THE INEVITABLE COLLISION OF GAMING AND ATHLEISURE

By Wired Team

AS STREAMERS BECOME MAINSTREAM CELEBRITIES, MAJOR FASHION BRANDS ARE ITCHING TO CASH IN. In a cavernous former bank in SoHo, New York, Fortnite pro Nate Hill was gaming in front of a live audience of dozens when, over Fortnite’s voice chat, a teammate asked if he’d ever modeled at New York Fashion Week.

“Yeah, I’ve done that a bunch of times,” said Hill, scoping in on an enemy. “Not a fan.”

Hill, 25, was a full-time model until he signed with the esports organization FaZe Clan in 2018. Now he games live on camera for a living, and, professionally, looks good doing it. At D-CAVE, a popup gaming event thrown by Diesel North America CEO Stefano Rosso, Hill wore a blue Champion hoodie with colorful Pac-Man ghosts down the sleeves and well-fitting, light-washed skinny jeans. His clean, white Puma sneakers were adorned with Tetris blocks, and yellow sunglasses framed his foxlike face.

“So many kids that are gamers are really into fashion,” Hill said in an interview with WIRED. “They are looking up to people like us who do both, and I think they want to do that as well.”

It’s passé to even mention the stereotype of gamers in fraying threads pale from basement binges, but in conversations at D-CAVE, Rosso’s new “lifestyle melting pot for esport fanatics,” some attendees didn’t hesitate. Most references to that phantom slob weren’t accusations; they were points of contrast. Attendees looked nice. A pair of red Nike Jordan

4s. Tailored sweatpants. A gray Adidas sweatshirt with blue details that played off blue-flecked Adidas sneakers. A Champion beanie with a matching Champion hoodie.

Despite the patina of money, the fashion on display at D-CAVE was not an enormous aesthetic shift from the at-home gamer uniform of cozy sweatpants and a worn-in sweatshirt. Right now, athleisure and streetwear are having a moment— and intersecting with the corporate mainstreamification of gamers.

“Athleisure is an outgrowth of sportswear,” says Dierdre Clemente, a fashion historian and professor at the University of Nevada, Las Vegas. While sportswear was originally engineered to, say, help a golfer’s arms swing with the least resistance, synthetic fibers and other modern technology and textiles have made it comfortable and stylish enough to become “the new casual,” she says.

“When people see these influencers with their nice clean clothes and tennis shoes, that’s how gamers in real life live out that identity.”

Dierdre Clemente, Unlv

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37 Growing up alongside sportswear was streetwear, now an inextricable ingredient to many athleisure brands’ looks. In the ’70s, tracksuits and high-end sneakers were big in urban landscapes. Over the next few decades, thanks to hip hop culture, streetwear proliferated into the mainstream. Now skateboarding apparel brands like Supreme elicit aroundthe-block lines for hoodies and T-shirts and, at least in Supreme’s case, $1 billion valuations.

“While the original athleisure trend was responsible for taking the comfortable silhouettes and performance features of sportswear out of the gym into everyday fashion, it was the global rise of streetwear that built the culture around it and made it collectible,” says Volker Ketteniss, head of menswear at trend forecasting firm WGSN. In a cute way, gaming is athleisure incarnate. It’s competitive and athletic, but yeah, sure, you’re sitting down. Cozy and fly, athleisure and its streetwear manifestations naturally mesh with gaming, which is probably why so many companies are putting out gamer-bait clothing: Adidas, Puma, Champion, Nike, UNTFD, and Uniqlo all sell apparel featuring gaming icons or have partnered with gaming celebrities over the last year. Luxury brands Moschino, Louis Vuitton, and Prada have done it, too. At the same time, esports teams like FaZe and 100 Thieves are raking in cash selling athleisure repping their pro gamers. 100 Thieves chief operating officer John Robinson estimated in a recent New York Times article that his company can take in “about half a million dollars of revenue” in a single morning, selling sweaters, sweatpants, and T-shirts with the minimalist appeal of Apple.

Clemente theorizes that the gaming audience has outgrown its “image of guys in dirty sweatpants and pizza-stained T-shirts.” It’s not just passé; it’s inaccurate. “The clothes are constitutive of their identity rather than reflective of their identity,” Clemente says. “When people see these influencers with their nice clean clothes and tennis shoes, that’s how gamers in real life live out that identity,” she says.

Despite the recent merging of big-brand, big-money athleisure and streetwear with gaming, fashion and videogames have been inexorably bound for decades. At conventions, attendees and merchants wear and sell handmade T-shirts, dresses, hats, pins, and cosplay signaling their fandom for Overwatch, League of Legends, or any number of popular games. That’s not to mention the effort players of online role-playing games like World of Warcraft and Final Fantasy XIV devote to making their in-game avatars as gorgeous and expressive as possible—a devotion that lives on as more recent online games like Fortnite and Grand Theft Auto Online have introduced paid skins.

Those fan-driven fashion efforts haven’t gone anywhere. But big corporations are increasingly maneuvering to cash in on today’s so-called hypebeast culture, creating anticipation around merch “drops” and cultivating a devotion to athleisure logos and lifestyles.

“There’s an amount of people into gaming without enough products or services to even show that they love, what they’re passionate about,” says Diesel and D-CAVE’s Rosso, who suggests the bustling convention marketplaces where small-scale artists sell gamer merch aren’t enough to meet

demand. “There are quite few, actually, and a lot of them are improvised.”

On the lower level of D-CAVE, Diesel-style streetwear with D-CAVE branding—single-color t-shirts and camo jackets— hung alongside merch from FaZe and Italian sportswear brand Kappa, which, in the gaming world, also refers to an emoticon on Twitch. Both Hill and streamer Ben “DrLupo” Lupo, who also attended D-CAVE, attribute the recent merging of athleisure branding and gaming to Fortnite, which launched the careers of countless Twitch streamers into the influencer space. The cycle is fairly straightforward: Streamers buy fancy clothes to signal their clout, their fans buy those same clothes to emulate them, which creates a market, which pushes more fashion brands into gaming.

“Before Fortnite and all that stuff blew up, I never really considered myself as someone who tried to maintain some level of fashion sense whatsoever,” said Lupo at D-CAVE. “If you look back 10 years, being a gamer was very unfashionable.

I wore jeans and a t-shirt and that’s that. Now, I have nice shoes,” he continued, pointing to his Adidas Ultraboost 19s.

Other top Twitch streamers like Imane “Pokimane” Anys have their own clothing lines, with hers featuring colorful joggers, sweatshirts and t-shirts with Japanese text.

Flashier gaming celebrities, anointed by Twitch, are taking the confluence to even further extremes. Tyler “Ninja” Blevins, perhaps the most famous name in gaming, was for a while glued to his Louis Vuitton sneakers, and just recently partnered with Adidas to make chunky kicks with his name plastered on the side. Earlier this year, Fortnite pro Turner “Tfue” Tenney said that, while he was at a Fortnite tournament in Miami, his luxury Swiss Audemars Piguet watch—potentially worth tens of thousands of dollars—was stolen out of his hotel room. In 2018, Overwatch pro player Jae-hee “Gesture” Hong told Dot Esports that he had spent $20,000 on streetwear—$10,000 of which was on sneakers.

“Before, it was [esports] orgs signing people to try to win tournaments. Now, it’s orgs signing people who have clout or the potential to represent the org for brands… and look good in their clothes to bring in more sponsors and stuff,” says Hill.

Hill says FaZe originally noticed him at a Fortnite tournament where he was wearing a Manchester City soccer jersey, which looked like the in-game jersey of his Fortnite character. Just last week, Hill tweeted out a gold statue in Fortnite of a chiseled man with a slick fade and a modelesque pout. He wrote, “Shoutout to @FortniteGame for putting a gold statue of me in the game. We made it boys.” The character’s name is Midas, and his description is “All that glitters is yours.”

Heading toward the New York subway after leaving D-CAVE, I passed through SoHo and into bordering Chinatown, where kitschy tourist shops displayed keychains, baseball caps, and fake license plates. One right across the street from D-CAVE hung two knock-off Fortnite shirts on the door. Inside, much of a wall was devoted to red, blue and black Fortnite hoodies.

The store was empty, but a sign outside read “T-SHIRT 5 FOR $10.”

The Lobster Mac ‘n’ Cheese Mystery: Why Brands Mix High with Low

By Wharton Team

Knowledge@Wharton: What inspired your study?

Jonah Berger: I’ve always been interested in why things catch on, why some products and ideas become popular. If we look around, we definitely see a certain trend as of late.

We see things that seem unusual creeping up in the popular sphere. I think it’s very clear that when high-status people do things, the rest of us start doing those things as well. When celebrities wear ripped jeans, for example, or when celebrity chefs start using potato chips and mixing them with caviar, everyone else does the same thing. This is something we’ve known for a while.

But where do those things come from in the first place? Why do high-status people start wearing ripped jeans or eating potato chips with caviar? Is it random that some of these things catch on, or might we be able to predict where these things come from and then predict the next big hit?

it. It trickles down from the top. The opposite notion that some have suggested is maybe in a few cases it’s bottom-up.

Traditionally lower-status groups or traditionally marginalized groups might start doing something, then the middle-status people do it, and eventually the high-status people do it.

That’s a theory. There’s never been much empirical proof for that theory, only suggestions here and there. But for the most part, we always see trickle-down. We see the high-status people do it, the people on the runways do it, then the sort of me-too brands — the Zaras and the H&Ms — pick it up.

And eventually Gap starts doing it. No offense to Gap. But eventually it trickles down to more mainstream folks.

Knowledge@Wharton: In the paper, you introduce the idea of “trickling round” in marketing rather than trickling down or up. Can you explain what that means?

“Anyone who wants to be an influencer, anyone who wants to be an early adopter, anyone who wants to be part of the vanguard needs to differentiate themselves in some way.”

Berger: I think we’re all familiar with the idea of trickle down. If any of you have seen the movie, The Devil Wears Prada, it says a little bit about this. Meryl Streep’s character is lambasting Anne Hathaway’s character, essentially saying, “Oh, you think you dress however you want to dress, but really it’s been chosen for you. A number of years ago, this was the color of the year, the high fashion on the runways.

Then, the next set of people start wearing it, the next set of celebrities, and then the next group of people, and eventually it trickles down into a bargain bin at Target or some other place where you picked it out.”

Trickle down makes a lot of sense. We see it happen often.

But there’s another pattern that also seems to be happening.

Take, for example, jeans. If you look at where jeans came from originally, it was coalminers and workers, traditionally lower-status groups that were wearing them before celebrities started doing it. Think back a decade or so about trucker hats. Ashton Kutcher and others were wearing trucker hats — those sort of mesh-backed caps that became popular.

Sure, he’s a celebrity. Sure, it went mainstream. But who was wearing it before him? It was truckers. These were hats that companies would give truckers and farmers to wear.

The notion there is trickle down, right? High-status people start doing something, then eventually the middle status starts doing it and it goes mainstream. Everybody’s doing

Think about the idea of ripped jeans. Where did wearing ripped jeans come from? It came from folks who didn’t have the money to patch up their jeans. Think about baggy jeans,

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think about potato chips mixed with caviar. They start low, but they don’t necessarily move to the middle first. They’re adopted directly from low by the high. That’s what we talk about as trickle round. It doesn’t go through the middle, and it doesn’t go top down through the middle to the bottom, but the top actually seems to borrow from the low in some cases.

Knowledge@Wharton: What do you think is behind this trend? What motivates people to borrow a signal from a different status?

Berger: I’m by no means a high-fashion person, but I’ve talked to a lot of folks in high fashion, and my collaborator knows a lot about fashion. And I use fashion broadly here — not just clothes, but anyone who wants to be an influencer, anyone who wants to be an early adopter, anyone who wants to be part of the vanguard needs to differentiate themselves in some way, shape or form. If everyone’s doing something, doing it isn’t a signal of differentiation. If the mainstream and a lot of people are doing something, that’s really off limits.

If you want to be a high-status person, if you are a high-status person, you just need to figure out a way to do something new to differentiate yourself. The challenge is where those new things come from. You can’t do what the middle’s already doing because then you’ll end up looking like a middle.

What we talk about is maybe highs adopt from the lows as a way to separate themselves from the middles. Things that are adopted by lows already have meaning, so [high-status individuals] can co-opt that meaning and in some sense shift that meaning a little bit, particularly because the middles are scared of doing it. There’s a bunch of older research on what’s called middle-status conformity and some more recent work as well showing that middles are worried about sticking out in the wrong direction, so they’re probably going to stick to what they’re doing. They know safe things. They want to avoid looking like lows. By doing things the middles

wouldn’t do — what the lows are doing — the highs create a way of differentiating themselves and discouraging the middles from following them.

Knowledge@Wharton: You highlight several fashion examples in your paper, including Balenciaga’s $2,000 version of Ikea’s iconic blue shopping bag. Other examples come from food. What are you seeing there?

Berger: We’ve all seen the lobster mac and cheese, right? We have passed the point of peak lobster macaroni and cheese.

Crab macaroni and cheese, lobster macaroni and cheese — there are a lot of these examples of traditionally high-end ingredients mixed with traditionally downscale ingredients.

We’re sitting here in Philadelphia, where there used to be a great $100 cheesesteak at a restaurant called Barclay Prime.

We think about $100 as expensive. We think about Kobe beef, the ingredient of that cheesesteak, as expensive. But we think about a cheesesteak as very cheap. What they’ve done is taken something that’s traditionally downscale and mixed it with something upscale. We see this in food, we see this in fashion, we see it in a variety of different domains — any place where the highs are trying to figure out a way to set themselves apart from the middles.

Knowledge@Wharton: Can you walk us through one or two of the experiments you did in the study?

Berger: We did a number of different things. We did studies where we measured people’s actual status and asked, “Do you want to do something that’s already high status, do you want something middle status, low status, or something that mixes high and low status?” If you’re planning a party, for example, and you’re a wealthy or a high-status individual, are you more likely to pick a menu for that party that mixes high and low? If we’re picking clothing, are we more likely not just to pick the traditionally high-end things, but also things that mix the high and low?

We also did some studies where we assigned people to be either high status or not, and then they had to pick a watch, for example. That watch has a color and a shape. Do you want to pick the color and shape of highs, of lows, of middles? Or maybe you want to pick a color of highs and a shape of lows, or a shape of highs and a color of lows — this idea of mixing and matching those two aspects. Across all those studies, what we see is middles like the middle stuff, sometimes middles like the high stuff, but highs really like this idea of mixing and matching.

“Highs only borrow from traditionally marginalized groups when there’s that ability to mix and match.”

Knowledge@Wharton: So it’s not simply a matter of adopting a signal from another status, it’s the process of mixing and matching that is key?

Berger: Yes, and I think this is really one of the interesting ideas behind this paper. Maybe this is obvious already, but most research says things have a signal. We’ll focus on one thing, and we’ll think about what that thing communicates.

What does it mean to drive a BMW? What does it mean to wear a certain style of clothes? What does it mean to work at a certain type of organization — a startup rather than a legacy business, let’s say?

We think about the meaning of these individual things and what they signal or communicate to us about others. What this research, as well as a small number of other papers, begins to talk about is that there are actually multiple domains of communication. For anything, whether it’s cars or clothes or anything we do, there’s not just one dimension. There are multiple dimensions, and we can mix and match across those multiple dimensions.

A famous Italian chef who we talk about in the paper uses potato chips on his menu. Now, if all you knew about that restaurant is that it serves potato chips, and I asked you, “Is it high or low end?” You’d probably say, “Well, they serve potato chips, so it must be low end.” If I told you a place serves macaroni and cheese by itself, you might assume it’s traditionally lower end. But by using multiple dimensions, by mixing and matching, by doing potato chips with foie gras or potato chips with caviar, it allows them to differentiate themselves. That’s what we find in the experiments as well.

When there’s only one dimension of communication, highs don’t pick things from the lows because they know they’ll be misconstrued. There’s no way to separate them from lows.

So, highs only borrow from traditionally marginalized groups when there’s that ability to mix and match. Pick something traditionally high and mix it with something more traditionally low.

Knowledge@Wharton: A lot of brands have been playing with this idea of borrowing signals from other strata. One example would be Target launching a clothing collection with high-end fashion house Missoni. Is there a danger for brands in that kind of mixing, especially when high-status brands are trying to differentiate themselves from the middle?

Berger: There are many strategies or many paths brands could take. And as long as you’re doing a good job of activating or implementing that path, you’re going to be successful. Take Missoni partnering with Target. If your goal

is to go “class to mass,” if your goal is to say, “Hey, we had a high-end positioning, but we want to make more revenue, we want to sell to a larger set of people. We don’t care if brand equity gets a little bit diluted,” then that’s a great strategy.

“Moving down-market is a great way to boost revenue in the short term, but once brand equity has been eroded, it’s hard to go back.”

By the way, it’s clear why Target wants to partner with a highend brand. It definitely benefits Target. It moves Target a little bit up in the status hierarchy. It can also be beneficial for those high-end brands because they sell more. Think about a Tiffany or a Coach. They’re still reasonably high-end brands but they’re not anywhere near as high [as they used to be].

Think about Donna Karan. When that brand originally came out, it was much higher than it is now. It’s moved downmarket, in part by choice to sell more stuff.

Moving down-market is a great way to boost revenue in the short term, but once brand equity has been eroded, it’s hard to go back. I think the danger of doing some of what we’ve talked about is when you try to mix and match but it fails or doesn’t seem authentic. Or it comes off the wrong way. If you’re not working with members of the communities you’re borrowing from, then it fails. Look at when brands try to do streetwear collections, but they don’t really understand and misappropriate concepts. Whereas, if they say, “Hey, let’s do a collaboration where it’s a mixing and matching of both of our brands,” and they really involve the creative team from that brand, that’s much more likely to be successful than just poaching symbols from other groups.

Knowledge@Wharton: What is the most bizarre example that you’ve seen of this kind of mixing?

Berger: Sylvia, my co-author who is a professor at Columbia University, celebrated the publishing of this paper by sending me cologne that’s actually [sold] in a spray-cleaner bottle.

It’s a very high-end cologne — probably $100 or $200, or maybe even more expensive than that. But it’s in this bottle that looks like Windex. It looks like it’s nothing. It’s an interesting idea. If I’m somebody who is trying to separate myself from the traditional luxury crowd or the middle-status group, maybe I’m more willing to purchase this because [those other individuals might say], “What is this thing that looks like Windex? I’m not buying it.”

Knowledge@Wharton: implications of the study?

What

are

the

broader

Berger: I think it moves forward our understanding of status. I think we’ve all been to a restaurant that has lobster macaroni and cheese or crab macaroni and cheese. We might have wondered, where are these things coming from?

I think now we get a better sense of where these things are coming from. It helps us understand status dynamics. Whether we’re brands or individuals, it helps us think about ways in which we might maintain higher status. If we want to be an influencer, novel, differentiated, if we want to be ahead of the crowd, we may want to think about mixing and matching. If we want to avoid being misperceived, we need to think about carrying it out the right way. It may be a direction for some brands or individuals to think about.

The 10 most innovative social media companies of 2020

By FAST COMPANY

For years we’ve complained that one has had to go back to the early 2010s to find an exciting new social-media application.

This past year might finally have broken the curse: irresistibly shareable personalized video clips from celebrities and being able to be a text chain with your favorite celebs show that there’s still room for novel ideas to go mainstream even in the face of one giant owning several major social platforms.

In addition, 2019 brought both the rise of social shopping as well as the return of niche networks for communities that make far less sense being dumped into a one-size-fits-all group.

1. CAMEO For creating the “famous faces on demand” platform, where fans pay for personal videos from more than 30,000 celebrities While it was launched in 2017, this past year marks the Chicago-based company’s pop-culture arrival. Both a utility for, and seemingly the next evolution of modern celebrity, the “famous faces on demand” service allows consumers to book celebrities to create personalized video shout-outs for anything from birthdays to good-luck wishes as well as prom invitations and marriage proposals. In 2019, the company’s employee headcount went from 18 to 135, while participating celebs skyrocketed from 3,000 to more than 20,000. Cameo also expanded internationally to the UK, Australia, and New Zealand, and raised $50 million in Series B financing.

Read more about why Cameo is one of the World’s Most Innovative Companies of 2020.

2. COMMUNITY For giving notable people like Kerry Washington and Jennifer Lopez the ability to text their fans—and receive texts back Launched in summer 2019, this text-based social platform provides celebrities, artists, and their fans a walled garden to connect, away from the prying eyes of trolls, and providing the stars with more information about their fans—age, location, and so forth—than they’re able to get from traditional social like Facebook, Twitter, or Instagram. So far, Community has kept its numbers deliberately low, less than a thousand celebrities and artists, but it’s an impressive cross section, including Ashton Kutcher (also an investor) Kerry Washington, Tony Hawk, Amy Schumer, Paul McCartney, Ninja, and more. Star music manager and Kutcher’s investment partner

in Sound Ventures Guy Oseary told Fast Company, “The point is now we don’t have to rely on platforms that share all of our information that don’t give [artists] the information directly. They’re all great platforms for broadcast. We all need them. We all use them. They’re awesome. But if I want to have a more meaningful, more direct connection, [Community] is the platform of the future.”

3. PINTEREST For finding new ways to convert inspiration into transactions The visual social network has evolved significantly over the past year, growing to about 335 million monthly active users, which is an increase of 26% year over year, outpacing the likes of Twitter, LinkedIn, and Facebook. Its U.S. audience was up 8% in 2019, while international audience growth was 35%. In terms of revenue, the company made $400 million in 2019 Q4, up 46% year-over-year, taking its 2019 total up to $1.14 billion. Back in September 2019, Pinterest introduced Shop The Look ads that allows advertisers to feature multiple products in a single ad, making it easier for users to buy more stuff from one image. Then in January 2020, it launched Try On, powered by Lens, that allows users to virtually try makeup products from brands like Estée Lauder, Sephora, bareMinerals, Neutrogena, and L’Oreal. Pin that.

4. LINKTREE For making Instagram’s “link in bio” into a sleek menu for sharing articles, merch, or paid partnerships This Australian company started in 2016 as a way to clear out the “link in

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43 bio� clutter from brands and others on Instagram trying to connect followers and their products. Now it links up social followers with your entire online ecosystem, using one link to direct people toward the e-commerce or other content that matters for any business or brand. Over the past year, Linktree averaged 10,000 signups a day, growing its active users by 200% to more than three million, with over 40% of traffic coming from sources other than Instagram, including Twitch, YouTube, and Pinterest. In July 2019, Chance the Rapper used it in his partnership with Lyft to launch his album The Big Day, giving fans the option to download it for free or donate to the Chicago Public Schools through SocialWorks, all within the Lyft app.

5. LOOSID For connecting sober people with each other Founded in 2018, Loosid is a digital sober community that makes dating, travel, and socializing easier for those who refrain from alcohol. When nonalcoholic beverages are worth $7 billion more than just four years ago, and zero- or low-alcohol beer is the fifth-fastest growing beer type, Loosid is tapping into the occasions around these trends. In early 2020, the company launched Boozeless Guides, inside looks at local restaurants and bars across the United States that offer alcohol-free drink options.

6. FLIGHTHOUSE For looping in more than 2 billion monthly views and 22 million fans to its TikTok talk show Flighthouse was on TikTok when it was still called Musical.ly, and now generates two billion monthly views. The channel passed the 20-million-follower mark this past year, up from 16.8 million. In early 2020, it launched a new music-focused, short-form show on Tik Tok called \”Certified Superfan,” as part of its partnership with Republic Records. Flighthouse has worked with such artists as Billie Eilish and Ariana Grande, but also helps lesser-known artists boost their profiles. Their campaign with Niki averaged more than 100,000 reposts a week, turning her track “Indigo” into a Top-5 trending song on TikTok. 7. HOLLER For powering 1 billion animated conversation stickers a day in iMessage, Twitch, and more Long the go-to app to have as many animated emoji options to ask your friends if they want to grab some pizza, the New York-based company rebranded from Emogi to Holler, and took its intelligent AI-powered, animated visual content for messaging apps and expanded to create sticker campaigns for brands like Ikea, Snickers, Bud Light, Fox, and Subway.

At the same time, it expanded to bring animated content to such platforms as Badoo and Venmo. It grew in 2019 from being a part of a billion messaging conversations a month to a billion a day.

8. MEWE For building the only social network with no ads, no targeting, and a privacy bill of rights Given its myriad of challenges around privacy, advertising, and user data, anything with a sales pitch that sounds like

the anti-Facebook merits attention. Since 2018, MeWe has grown at a 405% rate, and it hit five million members by mid-2019 and closed a $4.5 million offering, bringing the company’s total funds raised to $15 million. Internet pioneer Tim Berners-Lee is a board member, and says of the company, “MeWe gives the power of the internet back to the people with a platform built for collaboration and privacy.”

9. REVEL For helping women over 50 gather for friendship While most social startups focus on becoming the next flashy digi-bauble of whatever generation is coming next, Revel’s goal is to create a nationwide subscription-based network tailored to women over the age of 50, helping them foster new relationships. Still in its early stages, so far it has a community of 500 users, and has $2.5 million in funding led

by Forerunner Ventures. Age may be just a number, but the number of people in an often-forgotten social demographic— like the opportunity it represents—is huge.

10. JFK PRESIDENTIAL LIBRARY AND MUSEUM For re-creating the 50th anniversary of the Apollo 11 moon landing on Twitch To mark the 50th anniversary of the achievement of President John F. Kennedy’s 1961 “Moonshot” speech, the library partnered with its marketing agency Digitas to create JFK Moonshot, a fully synchronized, augmented-reality app that re-created Apollo 11 where every moment, maneuver, and milestone unfolded in real time, second by second, precisely 50 years later. It also followed the lunar mission on social media in real time, using almost 110 hours of Apollo 11 audio transmissions, fullscreen 3D animations, and live Twitter feeds in the voice of the astronauts. With more than 240 million brand impressions, the effort helped a new generation of Americans experience and get excited about space exploration.

How Digital Are Millennials in Their Shopping?

By eMarketer Editors

At a life stage that entails lots of buying, millennials are combining digital and in-store shopping in ways that work best for them.

“These are the omnichannel consumers, equally happy shopping online as they are shopping in-store,” said Joan Driggs, vice president of content and thought leadership at IRI, who was interviewed for our latest report, “US Millennials 2020: How’s that Adulting Thing Going—in Digital Usage, Shopping, Finances and Homeownership?”

Convenience also amplifies the mobile aspect of millennials’ shopping. In May 2019 polling by Fluent for SmartWallet, 70% of respondents 25 to 34 said they prefer using their phone to redeem coupons and rebates. Mobile app usage is standard procedure. In a December 2019 eMarketer survey conducted by Bizrate Insights, about six in 10 US smartphone owners ages 18 to 34 reported using mobile retail apps to seek more information and transact purchases.

Highly digital in other aspects of their lives, millennials naturally incorporate digital into their consumer behavior.

We estimate that 85.9% of millennials in the US will be digital buyers this year.

Ecommerce accounts for much of their purchasing. A 2019 CivicScience survey fielded through June asked respondents how much of their shopping is done online vs. in-store.

Among 25- to 29-year-olds, 50% said at least half of their shopping occurs online, including 27% who said that’s where “all or almost all” of their shopping takes place. The figures were similar for those ages 30 to 34.

There’s no prize for guessing where much of millennials’ online shopping occurs. A March 2019 report by CouponFollow (based on January 2019 polling) said two-thirds of online shoppers ages 22 to 37 make at least half of their online purchases on Amazon. They’re certainly on the platform a lot: In Feedvisor polling in February 2019, 74% of 23-to-38s said they visit Amazon at least weekly, including 25% who do so daily or almost daily. The 2020 edition of Roth Capital Partners’ millennial survey identified 73% of 19- to 39-yearolds as Amazon Prime members. Crucially for brands and competing retailers, Amazon is where many millennials begin when shopping. In CivicScience’s polling, 60% of 25-to-29s and 57% of 30-to-34s said it’s their starting point.

“It’s their No. 1 channel,” Driggs said. “It’s driven a lot by convenience—they really love convenience, and they love saving money.”

Social media figures into millennials’ shopping as well. In July 2019 polling by Adobe and Advanis, 63% of millennials (vs.

49% of Gen Xers and 33% of boomers) agreed that “there is a place for companies interacting with individual people on social networks, forums and/or messaging sites.”

On the downside, some millennials feel suspicious about brands’ usage of social media. That was evident in an April 2019 ThinkNow survey, where 34% of 23-to-38s said the phrase “I feel brands take advantage of me on social media” describes them at least somewhat, including 12% who said it describes them “completely.”

But millennials are aware of privacy issues, according to Ron Cohen, vice president of product strategy at Claritas, noting that “they’re perfectly willing to trade their privacy for anything of value, for free this or free that.” However, he also said this attitude changes “the minute you have kids. Then privacy becomes a concern. Maybe you have more to lose, or more to protect.”

Brand Advocacy – The Most Powerful Route to Market Growth

By Michael Gullan

As marketing communications becomes even more competitive, it’s more difficult for brands to stand out.

Many smart brand professionals are incorporating strategic advocacy programmes into their plans. Advocacy is the process of transforming customers and internal stakeholders into brand advocates.

What is a brand advocate?

Brand advocates should not be confused with influencers.

They are individuals who, • Elevate your brand through word of mouth and recommendations • Give positive reviews about your brand • Refer new customers.

While on the surface, this may seem to align closely with influencer marketing, it differs vastly in that brand advocates

aren’t compensated for recommending your brand. Instead, they do so based on information, experience, loyalty and a strong belief that your product or service offering is positively life-changing.

Five groups of people who make effective brand advocates Ideally, anyone that supports your brand and your business’s growth can become a brand advocate. However, for best results, these are the five people to focus on for your next advocacy campaign, 1.Customers or end-users The strongest brand advocates aren’t affiliated with your brand. Instead, their support is genuine and deeply influential. 92% of customers seek recommendations from friends, family, colleagues and other customers before trying a product.

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2.Your customer’s customers A typical example of the B2B2C route to market, where fellow professionals such as doctors, pharmacists, dentists, brokers and sales teams recommend your brand to customers. These advocates may not be affiliated with your brand but based on their position of authority, they are powerful brand advocates who can influence end-users.

3.Employees They are familiar with your brand’s culture and everything there is to know about your offering. They can be influential based on inside knowledge, making them ideal brand advocates. It’s important to nurture your internal advocates with ongoing internal advocacy campaigns.

4.Branches and franchises Due to their deep-rooted knowledge of your brand and the culture behind your products or services, branches and franchises affect purchasing decisions based on being part of the bigger network. Again, a strong advocacy programme will ensure your business is getting the best out of these potential advocates.

information and recommendation by ‘normal’ people. This makes brand advocacy one of the most effective channels in any B2B, B2C or B2B2C marketing strategy.

Why should you consider brand advocacy for your company?

The right advocacy programme offers brands many short- and long-term benefits that are highly targeted, effective, build loyalty and brand recommendations. Advocacy programmes are proven to obtain a higher ROI on your marketing budget, and the benefits include; • New customer acquisitions • Build loyalty amongst existing customers • Communication with existing clients in a more tailored and personalised approach • Ignites learning and interest about your brand and its values • Encourages advocacy amongst internal and external stakeholders

5.Business and brand partners

• Data insights gives you a deep understanding of each user and empowers you to optimise and improve results.

Comprised of charity organisations and other companies affiliated with your brand, these brand advocates are loyal because your brand has always been loyal to them, allowing them to recommend you to a larger target audience.

To find out how you can harness the power of brand advocates, talk to a team that’s leading the way with advocacy programmes for local and international brands.

The above five groups of powerful advocates are best positioned to influence your target market, meet your marketing objectives and increase market share. Research

by Forbes shows that 76% of people are more likely to trust

Michael Gullan is the Co-Founder and Managing Director of G&G Digital www.gullanandgullan.com. A tactical strategist and strong leader, Michael is an outof-the-box thinker who is passionate about the clients and brands G&G Digital serves.

PROS & CONS: CONVERSATIONAL AI AND CHATBOTS

By PROS & CONS

Advances in artificial intelligence are leading to ever-more sophisticated conversational AI. What are the pros and cons?

Most of us have used conversational AI – even if we did not realise it at the time. Conversational AI is a set of technologies that enable computers to understand, process and respond to voice or text inputs in natural ways. In addition to platforms like Alexa and Siri, it is also often used in the form of chatbots, particularly in customer service.

Done well, conversational AI helps people interact with complex systems faster and easier and helps businesses deliver better and cheaper personalised support. Done poorly, it combines all the worst aspects of “computer says no”.

As advances in artificial intelligence allow the development of ever-more sophisticated conversational AI, it is likely that its use will increase. So, what are the pros and cons of conversational AI and chatbots?

Pros: Advantages and Opportunities

of smaller companies. The greatest advantage may not be in reducing the human workforce, but in allowing companies to reallocate their human staff to answering more difficult queries and improving service. This leads us to reason two: improved service.

Improved service and sales The conversations that customers have with businesses matter a lot. They can shape customers’ opinions and their dedication to a brand. Customer service representatives are only human, so their responses to customer queries can vary.

A chatbot, however, will always stick to the rules that are set for it. It will always respond in the exact same manner.

Chatbots can also be programmed to speak multiple languages, allowing companies to reach more customers, and they can be available 24/7.

Chatbots can also be used to market products and send out updates to customers. This can be a more personalised mode of marketing and can improve the chances of converting ads or queries into sales as well.

Cost

Data collection

This is one of the main reasons many businesses are interested in conversational AI – chatbots are a lot cheaper than humans, and they do not need time off. This can make chatbots seem like a good solution for large companies or those that are growing rapidly.

Conversational AI can be a big help in gathering data through customer interactions. This can include insights about customer activities, preferences, problems and more.

Users can then sort through the data to highlight common queries and understand the types of information customers most often want. Companies can use this data to solve problems, update their website information and upgrade internal processes.

However, installing a conversational AI system can have large up-front costs, and this may put these systems out of reach

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Cons: Disadvantages and Risks They aren’t human This may seem obvious, but people often want to interact with customer service representatives that have empathy and can respond accordingly. Despite continuous improvements aiming to make them more “life-like,” chatbots can still seem mechanical. And, while chatbots have no difficulty in handling customer requests that follow a predicted path, they are unable to improvise when the conversation takes an unexpected turn.

New approaches to conversational AI are focusing on creating chatbots with personality and that can appear to express empathy. Highly context-aware chatbots are also being developed that can “remember” elements of past conversations or adapt to different contexts.

They can then use this information to respond in a more realistic way. It remains to be seen, however, how people will feel about interacting with a business when they can no longer tell if they are talking to a human or a bot. And this highlights another issue – high expectations.

Frustration Primed by movies like “Her” and “Jexi,” and PR, people are increasingly expecting conversational AI to respond as a human would. But it is still not possible to have an actual conversation with a bot. For example, Alexa can tell you

what the weather will be like, but it can’t give a personalised answer to a question like: “What should I wear today?”

IBM Research Manager David Konopnicki, who studies affective computing, points out that: “Even when people know that they are having a conversation with a computer, it’s surprising to see that they not only appreciate that the computer has empathy — they expect it.” These expectations can then lead to frustration when they cannot be met. And of course, the best bots are the most expensive, meaning that once again smaller companies may have difficulty in meeting customer expectations using bots.

One of the greatest disadvantages of most conversational AI is that it can only handle first-level questions, rather than complex queries. For the customer seeking an answer to a simple question about shoe sizes or billing, this is not an issue. But for systems like Siri, the ability to hold a real conversation would be a game-changer.

But to do this, the AI will need to know a lot more about each user. And it is not yet clear whether people will be willing to give algorithms unfettered access to every aspect of their lives or to reach a place where it is impossible to tell if they are talking to a human or a machine.

For now, chatbots remain a very useful tool. They may ultimately progress further than this, to a type of personal assistant that knows as much about our lives as we do. The day when this happens is coming ever closer, but whether we want it to or not is another question.

BRAND DISRUPTION STUDY 2020: DIRECT BRANDS GO MAINSTREAM

BY IAB STAFF

You’ve seen the headlines: “Lord & Taylor Sold to Clothing Rental Start-up Le Tote.”

“L’Oreal Debuts Personalized DTC Hair Color Brand.”

“P&G Freshens Grooming Segment with Billie Acquisition” Why is this happening? Because the new direct-toconsumer business model is based on the concept that its entire supply chain is increasingly available “as a service.”

Every aspect can be rented/leased. The result? Greater brand agility, more innovation by publishers, and more engaging, personalized consumer experiences—online and off—with “emerging tech” elevating the digital shopping experiences.

In fact, digital data output will triple from 2019 – 2025,

powering demand for and availability of personalized services, products, content, and marketing.

The Direct Brand Economy is achieving mainstream status as major brands pivot their own business operations and marketing strategies to address changing consumer behaviors and adopt new technologies. And the expectations that consumers now have to receive goods and services in two days or faster impacts virtually all brands across every step in their supply chains. This new business model is impacting every major consumer category and forever changing the way we buy, sell and go-to-market.

IAB has been committed to alerting the digital ecosystem to this transformation, releasing its newest reports, “2020: The

Mainstreaming of the Direct Brand Economy” and “2020 IAB 250 Direct Brands to Watch” to educate stakeholders on the trends, developments and milestones set to drive the future growth of brands. Both reports were presented at the 2020 IAB Annual Leadership Meeting, Feb 9-11 in Palm Desert, CA. Additionally, IAB added 100 DTC services to watch to our database of Direct Brands. IAB methodology in selecting these brands is a mathematical formula that includes revenue range, employee size range and a social footprint index and y/y social growth. DTC products have been receiving the lion’s share of press and consumer attention—but the 1-1 relationship these services have built with their customers and wider audiences to drive engagement and customer satisfaction cannot be ignored.

Here are key highlights from these presentations on the Direct Brand Economy: The data economy is being disrupted.

Privacy legislation, the blocking of cookies and tracking of ads. The disruption is real and it’s here and will be soon felt across this ecosystem – from marketing strategies and buying & planning to platform and publisher operations.

• More than half (52.8%) of US digital marketers feel that government regulation has the potential to impede their ability to derive value from data-driven marketing efforts.

• Conversely, 69% of companies are building strategies to govern data usage.

Personalization equals relevancy.

Personalization capabilities range from advanced technological channel executions to cross-channel automation & attribution enabling real-time optimizations based on return. Custom media messages embedded in context, bespoke products, and innovative usage of AI are proven personalization tactics driving brand loyalty.

• 10% more DTCs are allocating budgets for personalization in 2020 • 50% of digital device consumers will make a purchase and become brand loyal if they receive personalized brand content The new shopping experience is omnichannel, integrated and brand-driven.

Brands are able to come into existence “store-lessly.” As consumers use keyboards to make purchases across verticals, some of these store-less brands choose to stay online-only.

Additionally, a new “Shopify ecosystem” is materializing as a direct-brand alternative to Amazon.

The brick & mortar experience is, therefore, impacted. It now requires brand integration. Experiences. A cool factor.

Today’s brick & mortar world is a place where consumers can relate to the product, embrace the brand, delight in it, revel in it and share it. Providing a first-rate customer experience is a number one priority for retailers and brands alike. And brick and mortar is reliant on an online integration: BOPIS (buy online, pick-up in-store) is the new normal in shopping.

• In the last 2 years, Walmart has expanded the number of in-store pickup kiosks by 8x to 1,700 stores and expects

curbside service will account for 33% of their digital sales in 2020 • J.C. Penney is testing new in-store, interactive services including fitness and yoga classes, cooking demonstrations, kids clubhouses, relaxations lounges and cafés • New and evolving retailers and brands are reimagining in-store experiences to be multi-purpose (stores as lifestyle hangouts). Leveraging emerging tech for nextgen customer service experiences (e.g., cashier-less stores and virtual try-ons) and utilizing shipping innovation to speed up delivery times points to the fast-tracking of the reinvention of the entire brand economy.

The new DTC model applies to media as much as it does to products and services.

The anytime/anywhere delivery of media combined with the fact that total media consumption is at an all-time high (now an average of 48% of our day) means marketers deliver 1-to-1 messaging as a norm. Media companies are in the middle of a streaming war. Consumers have an unprecedented wealth of content and advertisers have significantly greater inventory options. The winner will not be traditional broadcast TV or even digital subscription video services. And the war will be over once consumers cut the cord on traditional broadcast.

• Compared with the year prior, video viewing through TVconnected devices has increased by eight minutes/day • Video on smartphones and tablets increased by an average total of five minutes/day • Podcast & audio streaming are creating breakout brand opportunities; and with a shift away from downloading to streaming, advertising opportunities will evolve Commerce, content and data are converging.

Traditional, big media companies are no longer the gatekeepers of media. Shoppable advertising on TV, Social, and within ads appearing virtually anywhere. Why? Consumption of video is skyrocketing both as “story-based,” and “me-based,” with, content, commerce, and data are converging. This has sparked e-tailers to create content, and data companies to merge with publishers.

• Pinterest launched “Shop the Look mobile ads” enabling retailers to feature up to 25 products in a single ad on mobile devices and direct users to their own retail site.

• TikTok is beta testing shoppable short-form videos which allow viewers to click on the in-app video and be taken directly to the creator’s store without leaving TikTok In the not-to-distant future, a few very savvy, highly successful, multi-disciplined companies will be the new media gatekeepers. The winners will be those heavily armed with first-party user data—and have ways to continue to build and maintain that data—and that do/will sell ads and that will/do create content. And while Regulatory concerns about consumer data are high, it does not yet seem to be affecting companies’ data investments.

For additional insights and greater depth, please read the full report.

Marketing Message Overload

By CMO Team

It’s time to take a walk in the woods, away from crowds, melt within the flora and fauna, breathe. Soon, the joy of nature begins to wash over me. And after a good while, as Henry David Thoreau writes, I’ll return taller than the — damn, my phone’s buzzing again.

promoting their “stuff.”

Just like that, I’m yanked back into the noisy digital world of spam. It’s where a person living in the rural United States receives 2,500 marketing messages daily. I combat the noise by mindlessly deleting, unsubscribing and blocking. This isn’t the new meditation; it’s madness.

It’s incredibly important for marketers to cease the carpet bombing and take better aim. In our companion article, “Striking Gold,” Latane Conant, CMO of 6sense, likens this to prospecting for gold during the California Gold Rush. Late comers dig and pan in vain on land already panned out.

Marketers say they’re on the path to personalization. They claim they’re crafting messages that touch the quick of human emotion. They believe they’re on the way to mastering the art of delivering the right message to the right person at the right time.

Predictive analytics, on the other hand, unearths people in market in real-time, Conant says. This gives account executives the best chance in striking a sale: be super selective and dig only in the right places at the right time.

We all know that’s not happening.

In truth, marketers take a shotgun approach to messaging and customer prospecting. Just look at email marketing, for instance. According to Campaign Monitor, the average open-rate last year landed at 17.8 percent—less than one out of five recipients even opening the email. Worse, the click-through rate averaged at a meager 2.6 percent.

How can 2.6 percent be a benchmark for anything?

Something is rotten in the state of marketing.

Tired of being bombarded, huge percentages of our customers simply disengage. Marketers need to refine their focus with smarter outreach campaigns and stop interrupting people with aimless messages.

This issue of Marketing Magnified takes a deep dive into the idea of fruitless messaging and how to stand out: In our feature article, “Your Fist and the Future of Marketing,” Jonathan Martin describes how the brain shields itself from the daily assault of thousands of marketing messages.

In the old days, a few marketers could interrupt people in hopes of getting their attention. Digital marketing, though, made interruption all too easy for the legions of marketers

“The tools and techniques built on traditional interruptionbased marketing methods are simply getting less and less effective with every passing quarter,” Martin writes.

“Like most companies, we traditionally had assigned territories on an annual basis and used tons of data and insights to design those territories,” Conant writes. “Though it was a static list, we found that our ideal customer profile is actually quite dynamic.”

Adopting a targeted approach is the best way to rise above the noise…right?

Then again, marketers will still disrupt someone’s day. The trick? Make the message so relevant that it doesn’t feel like an interruption, or at the very least, the recipient doesn’t mind.

In our Get to Know profile, Jennifer Weissman, CMO of Boston Ballet, shows how to interrupt people the right way. At its core, her job is getting people to the ballet, but that’s just the result of her efforts, not how she leads her messaging.

Rekindling our artistic nature, deepening our connection to ballet and encouraging us to become lifelong enthusiasts remains Weissman’s real goal.

“It’s all about helping people feel closer to the art and having memorable experiences with their friends and family,” Weissman says. “We want to share the fun, social nature of the experience as well as the artistry.”

Not quite a nature walk, but it’s close enough for me.

‘MISBEHAVING’: WHEN PSYCHOLOGY MEETS ECONOMICS

By Richard Thaler

Job No. 1 for CEOs today is ensuring the company delivers a compelling customer experience. This laser sharp focus on the total experience must span the entire demand and supply chain and incorporate every aspect of how products and services are designed, priced, marketed, sold, delivered and supported. However, delivering compelling experiences requires that leaders avoid common mistakes, notes this opinion piece by Mark Leiter. Leiter is chairman of Leiter & Company, a strategy consulting and investment firm, and a distinguished strategy fellow at The Conference Board. He is author of the book, Crafting Strategy in an Accelerating World.

In 1981, Ford started running an ad campaign that asserted “Quality is Job 1.” Automakers weren’t alone in prioritizing quality back when dead batteries, overheated engines, flat tires, and broken turn signals were all frequent car problems.

This was also an era when television reception was fickle, food was quick to spoil, and banks miscounted money. Over the last 40 years, most major quality problems have vanished due to fanatical measurement coupled with advancements in design, business processes, science and technology.

Now customers expect even more. For example, my first car seat only moved forward or back using a manual lever.

In contrast, today my car has 18-way power, massaging seats with lumbar support that can be heated or cooled.

Unfortunately, my car seat doesn’t know how to sense my actual comfort and automatically reposition itself to make me happier while I’m on the open road. I now ask myself a question that would have been unimaginable in my youth: “Why isn’t my car seat getting smarter each time I drive my car?”

From ‘Full-service, Analog’ to ‘Self-service, Digital’ Experiences With excellent quality now more or less have shifted their energy to improving customer experience. To distinguish environment, the best companies are intuitive, self-service, digital experiences customer interactions.

a given, companies every aspect of the themselves in this on a quest to put at the center of their

The financial sector was an early adopter when it started replacing tellers with ATMs. Customers these days rarely need tellers, bankers, brokers or service agents to handle transactions or inquiries; most everything can be conveniently and accurately handled on some screen. Talking to a financial services employee might soon become a “once in a decade”

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occasion for an average customer.

It’s not just financial services. We see this front-line transformation happening everywhere. Cashiers are disappearing from grocery stores while pharmacies use apps to manage Rx refills. It has probably been years since you stopped to check out of your hotel.

However, the new world of customer experience also makes new demands on customers. If not managed skillfully, these demands can drive away large segments of your customer base. Long before customers arrive at the self-checkout aisle they have been overwhelmed with mind-boggling choice. Amazon offers more than 600 million products on their website. A typical Walmart has 150,000 products in a supercenter and 70 million more online. Typical smartphones now have several hundred features — and access to more than a million apps.

The best companies are on a quest to put intuitive, self-service, digital experiences at the center of their customer interactions.

Without meaningful guidance, a world of abundance can lead to paralysis for customers forced to make their way alone through the thicket. Even worse, our self-service world assumes customers can independently follow instructions and complete tasks — despite huge variations in intellect, education, health and wealth. The future will demand even more customer self-sufficiency in an environment of greater complexity. A glitchy app, devices that turn out to not be so intuitive, or long queues for help can devastate your customer service strategy. Companies must work overtime to ensure no customer gets left behind.

Entangled Brands Our global ecosystem requires leadership teams to constantly rethink how they can improve their experience in the context of every other experience that might impact their customers.

Like it or not, you need to understand how adjacent products and services work with your offerings, or your customer will end up in the dreaded Catch 22 in which the hardware maker blames the software maker — and vice versa.

Consider Jessica, who is flying from NYC to San Francisco for a business trip. She takes an Uber from Brooklyn to JFK airport. Arriving at the Delta Air Lines terminal, Jessica zips through security using her TSA Precheck status and grabs a coffee at Starbucks.

She is thrilled to be upgraded to First Class, but that joy fades once Jessica can’t connect her Apple MacBook to the GoGo inflight WiFi using her T-Mobile account. Meanwhile, her fancy Bose noise-cancelling headphones can’t tune out a screaming baby.

Her plane lands, and she takes a Lyft to the Westin, but gets stuck in traffic. Her frustration escalates when the check-in kiosk doesn’t recognize her reservation. She often stays at Hilton hotels and has no Westin status, so she stands in the “non-elite” line to get her keycard.

While standing on that line, Delta pushes Jessica a survey asking for feedback about today’s trip. “What is her willingness to recommend Delta on a 1 to 10 scale?” Where should she begin her story? Her journey is the byproduct of entangled brands and external forces. This influences her mood, reviews, and rants at any moment — and she is just one of several million travelers that had their own unique expedition that day.

Avoiding Common Mistakes During the peak of the quality movement, the big problems were obvious (e.g., several million cars with overheated engines each year), while solutions were universally applicable. In contrast, today’s enterprises aspire to align the individual experience to a customer’s exact needs. That’s a big ambition, one that requires continuous improvement in multiple dimensions. Success in this environment means swerving around several common mistakes and pitfalls.

Leaving average customers behind in favor of indulging the most loyal, profitable customers.

Which customer is more likely to define your company’s brand image this year? Is it the highly profitable “platinum” customer who has no complaints because they get expedited concierge care — or is it the average customer, who remains on hold for 45 minutes to reach a call center agent who fails to resolve an urgent problem?

In today’s world, your company’s reputation is only as good as the experience delivered to your average customers — because they are your biggest population and hold the social media megaphone. When your average customers are unhappy, they post that news on Facebook, Twitter, Yelp, and a host of specialty forums. Instead of leaving average customers behind, maybe it is time to reset the bar. The winning formula now is ensuring the average customer is completely satisfied while highly profitable customers are ecstatic. How do we make this happen? Let’s turn to the next topic: business model transformation.

In today’s world, your company’s reputation is only as good as the experience delivered to your average customers.

Neglecting fundamental business model transformation to reinvent the customer experience. The famous pivot Netflix made from shipping DVDs to offering thousands of videos via streaming is a classic example of business model transformation dramatically improving the average customer experience. While this transformation involved capitalizing on new technology, the point of departure was rethinking the business model.

This line of inquiry may be more important than ever. Why? In a world with more than 300 million businesses that are seeking new sources of growth, industry lines inevitably keep blurring. At any given moment, a new array of nontraditional competitors is already casting an eye on your customers. The “payments experience” is a prime case extending across the global financial services, technology

and telecommunications, and social media sectors (e.g., using Apple Pay or Venmo on your Apple iPhone powered by AT&T and linked to your American Express card to pay for a meal at a McDonald’s restaurant).

Based on my work with CEOs and Chief Strategy Officers, every leadership team is exploring how best to shape the customer experience using insights drawn from massive amounts of data — leveraging analytics, algorithms, machine learning and artificial intelligence systems. All these capabilities will be part of the solution, but successful companies aren’t starting their strategic debates focused on new tools and techniques. Instead, they are challenging their most fundamental strategic assumptions, and are willing to consider business model transformation as often as necessary.

Not being bound to what worked in the past is a prerequisite for unlocking new innovations that can make a step change improvement in the average customer experience.

Failing to predict how customers perceived an experience before intervening or requesting feedback. Imagine you are fast asleep at 1:30am in a hotel room. Your hotel “neighbor” blasts loud music that startles you awake. As a frequent traveler who is now half asleep, your first instinct is to wait a few minutes and hope they turn the music off. Eventually, you lose patience and call security. After another 20 minutes and a few loud knocks on their door, the music finally stops, and you go back to sleep.

The next day you receive a survey from the hotel asking you about your experience. You ask yourself, “Why don’t they already realize I had a horrible experience last night, and why isn’t this reflected in their outreach?” You take a few more steps, pause, and also then ask yourself, “Why don’t they have sensors and cameras in every hall to detect loud noises and dispatch security automatically to check out what’s happening, long before I have to complain?” More intelligent tools and technology will eventually address all this missed opportunity, but the winning companies will be those that get to this future faster. Much faster.

Under-valuing great horizontal leaders who rally colleagues to improve the total customer experience. Delivering the end-to-end customer experience requires precision cross-enterprise integration.

Yet, too often organizations shine the brightest spotlight on vertical leadership success, which is all about a CXO leading a silo of executives, managers and associates to deliver measurable goals that are escalated each year. In parallel, these same organizations often fail to applaud the naturally gifted horizontal leaders who work across silos and engage peers to renovate the customer experience. This may be harder to measure in practice — although we all recognize the behavior when we see it. The strategic question is whether the organization is devoting enough time to teaching and rewarding horizontal leadership that strives to ensure no key component of the customer experience is dropped during handoffs between divisions and departments.

Failing to connect Boardroom conversations to your customer experience evolution. While many corporations aspire to be “customer-centric,” Boardroom discussions are frequently disconnected from the customer experience. They might include reviewing M&A deals, new government regulations, rising health care costs, succession planning, and other matters without a single mention of the word “customer.” This is a missed opportunity. Ideally, each board meeting should allocate some time to reviewing what steps are being taken to make customer experiences more compelling — because that is a clear path to prosperity and should leverage the board’s expertise. If you’re a board member and you notice that the agenda includes everything except customers, you might suggest a shift. Your fellow board members will appreciate the intervention.

Where are we on this grand voyage to radically improve customer experiences and rewire organizations to avoid common mistakes? If we step back and consider the complexity that leaders must navigate, we might be standing in a spot that is analogous to where we stood as a society with respect to the quality movement in 1985, the mobile phone in 1995, or cloud computing circa 2005. We are still in the early innings of proactively shaping the individual’s entire customer experience journey in tune with their changing needs. That means we can all look forward to decades of innovation. It’s a moment of tremendous opportunity for leaders who are willing to fundamentally reinvent how companies connect with their customers

Book,

&

Line

Sinker

Start with Why: How Great Leaders Inspire Everyone to Take Action

Branding: In Five and a Half Steps

By Simon Sinek

Michael Johnson is one of the world’s leading graphic designers and brand consultants. His studio, johnson banks, is responsible for the rebranding of many notable clients, including Virgin Atlantic, Think London, BFI, Christian Aid, and MORE TH>N, and he has garnered a plethora of awards in the process.

Why are some people and organizations more innovative, more influential, and more profitable than others? Why do some command greater loyalty from customers and employees alike?

Even among the successful, why are so few able to repeat their successes over and over?

Work for Money, Design for Love

By David Airey Unlike other dry business books, this refreshing, straightforward guide from Logo Design Love author and international designer David Airey answers the questions all designers have when first starting out on their own. In fact, the book was inspired by the many questions David receives every day from the more than 600,000 designers who visit his three blogs each month.

By Michael Johnson

Show Your Work!: 10 Ways to Share Your Creativity and Get Discovered

By Austin Kleon

In his New York Times bestseller Steal Like an Artist, Austin Kleon showed readers how to unlock their creativity by “stealing” from the community of other movers and shakers. Now, in an even more forward-thinking and necessary book, he shows how to take that critical next step on a creative journey—getting known.

Don’t Read This Book: Time Management for Creative People

Creative Strategy and the Business of Design

By Donald Roos

By Douglas Davis

Most of our ideas never see the light of day.

Why? If you ask a creative person, the answer will always revolve around time. Don’t Read This Book focuses on how to make choices about everything you do in your daily creative practice and life.

Remaining relevant as a creative professional takes more than creativity--you need to understand the language of business. The problem is that design school doesn’t teach the strategic language that is now essential to getting your job done. Creative Strategy and the Business of Design fills that void and teaches left-brain business skills to right-brain creative thinkers.

Bigger Than This: How to Turn Any Venture Into an Admired Brand

How to Launch a Brand (2nd Edition)

By Fabian Geyrhalter Following the success of his #1 bestselling book, “How to Launch a Brand,” acclaimed brand strategist Fabian Geyrhalter is back with an enlightening new book that digs deep into today’s new world of brand creation. “Bigger Than This” challenges companies – from startups to Fortune 100s – to (re)discover their spark and connect with today’s consumers on a deeper level.

By Fabian Geyrhalter Most entrepreneurs, even seasoned brand managers, launch first and then work on slowly transforming the new offering into a brand. A logical progression, I would agree. After all, how can you possibly launch as a brand if you don’t have any customers or marketing outreach and—obviously, since you just launched a new offering—you have no legacy or advocates?

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Identity Designed:The Definitive Guide to Visual Branding

Unconscious Branding

By David Airey Ideal for students of design, independent designers, and entrepreneurs who want to expand their understanding of effective design in business, Identity Designed is the definitive guide to visual branding.

Written by best-selling writer and renowned designer David Airey, Identity Designed formalizes the process and the benefits of brand identity design and includes a substantial collection of high-caliber projects from a variety of the world’s most talented design studios.

For too long marketers have been asking the wrong question. If consumers make decisions unconsciously, why do we persist in asking them directly through traditional marketing research why they do what they do? They simply can’t tell us because they don’t really know. Before marketers develop strategies, they need to recognize that consumers have strategies too . . . human strategies, not consumer strategies. We need to go beyond asking why, and begin to ask how, behavior change occurs.

The Persuasion Code: How Neuromarketing Can Help You Persuade Anyone, Anywhere, Anytime

By Christophe Morin PhD Most of your attempts to persuade are doomed to fail because the brains of your audience automatically reject messages that disrupt their attention. This book makes the complex science of persuasion simple. Learn to develop better marketing and sales messages based on a scientific model; NeuroMap.

Pitch Anything: An Innovative Method for Presenting, Persuading, and Winning the Deal

By Oren Klaff

By DOUGLAS VAN PRAET

Flip the Script: Getting People to Think Your Idea Is Their Idea

By Oren Klaff s there anything worse than a high-pressure salesperson pushing you to say “yes” (then sign on the dotted line) before you’re ready?

If there’s one lesson Oren Klaff has learned over decades of pitching, presenting, and closing long-shot, high-stakes deals, it’s that people are sick of being marketed and sold to. Most of all, they hate being told what to think. The more you push them, the more they resist.

Logo Design Love: A Guide to Creating Iconic Brand Identities, 2nd Edition

By David Airey

When it comes to delivering a pitch, Oren Klaff has unparalleled credentials. Over the past 13 years, he has used his one-of-a-kind method to raise more than $400 million - and now, for the first time, he describes his formula to help you deliver a winning pitch in any business situation.

Completely updated and expanded, the second edition of David Airey’s Logo Design Love contains more of just about everything that made the first edition so great: more case studies, more sketches, more logos, more tips for working with clients, more insider stories, and more practical information for getting the job and getting it done right.

The Infinite Game

Nine Lies About Work: A Freethinking Leader’s Guide to the Real World

By Simon Sinek How do we win a game that has no end? Finite games, like football or chess, have known players, fixed rules, and a clear endpoint. The winners and losers are easily identified. Infinite games, games with no finish line, like business or politics, or life itself, have players who come and go. The rules of an infinite game are changeable, while infinite games have no defined endpoint.

There are no winners or losers - only ahead and behind.

By Marcus Buckingham our organization’s culture is the key to its success. Strategic planning is essential. People’s competencies should be measured and their weaknesses shored up. People crave feedback.

These may sound like basic truths of our work lives today. But actually, they’re lies. As Marcus Buckingham and Ashley Goodall show in this provocative, inspiring book, there are some big lies - distortions, faulty assumptions, wrong thinking - running through our organizational lives.