Ten biggest threats to business

A global survey has given us a picture of what exactly the biggest challenges are for business managers today. Across categories and regions the message is the same – there are half a dozen particular issues companies are feeling pressured by, but don’t know how to deal with.

Those clever marketers at Ernst & Young have come up with a catchy way of showing what we’re all facing – they call it the Risk Heat Map.

Businesses of every size are facing the same big problems. Fortunately current research shows how your business can turn this time of rapid change to your advantage.

The real insight for business owners in this picture is that while managers recognise these risks, as we look across the Y axis we realise most don’t know how to deal with them. These challenges are the consequence of a new paradigm. There’s an elephant in the boardroom – it’s right there in the middle, emerging technologies. Yes, it’s the Internet.

Drivers of business change 

The Internet has changed everything. For the first time in the history of commerce, we now have true globalisation thanks to the transparency the Internet gives customers. People can now find the truth about any product or service in just a few clicks, in the privacy of their home or using a smart phone on the shop floor.

In the recent past there was still an advantage in being big – a manufacturer could configure a product and control its availability by region, a retailer could price a product depending on the suburb. Today with instant transparency, a customer can pick and choose from what’s on offer anywhere in the world.

Brands can no longer rely on any competitive advantage from tradition, size or resources. Rather, as Boston Consulting says – “in a world of change, the spoils go to the nimble”. The key to success is not just recognising the drivers of change, it’s ACTING on them.

The biggest risk to any business today is inaction. UNO has a proven formula for growing challenger brands. We can help you start today, risk free.

Email gm@unomarcomms.com for an outline of our process.

What is beauty in commercial art?

“We have a duty to keep ads beautiful” said Craig Davis, co-chairman and chief creative officer with Publicis Mojo Australia and New Zealand in Campaign Asia, yesterday.

I respect Craig, we pitched against each other for The Rocks account decades ago when we were young and radical and creative directors of competing boutique Sydney agencies. I won. The next year I pitched against him again, for Sydney Water. He won. 

Personally I don’t think advertising is art. It’s Commercial art, capital C. The latest CEO survey published in the same magazine reports 80% of the region’s CEOs think marketing people “are in La-La Land”. 

Craig’s musings on beauty in advertising aren’t going to change those perceptions. He is concerned “talent, craft and significance of ideas are being pushed aside by the desire to save time and money.” Craig makes a point worth taking the time to consider – we have all seen examples of the office junior being asked to whip up an ad because they know how to use clip art and can have it done in no time. Or the manager’s nephew is good with computers so he can build the corporate website for less.

All of this is being driven by the changes enabled by the Internet, “the flip side of the new digital meritocracy is that there’s an inordinate amount of noise generated” observes Craig.

He reminds admen “clients pay us to deliver results.” Hear, hear I say.

Then he returns to his point that “at its best, advertising is beautiful, but in the absence of creativity, it is just pollution. In the words of John Keats: Beauty is truth, truth beauty—that is all ye know on earth, and all ye need to know.”

Advertising that works is advertising that delivers a ROI

Business owners are more inclined to see beauty in numbers, like low cost per lead, and high rates of conversion. The fine balance of marketing communications is understanding how to use creativity to commercial advantage.

There is undeniable beauty in identifying a genuine human truth and expressing it to an audience in a way they find appealing. But let’s not talk about beauty for its own sake, lets talk about craft. Both in the craft of storytelling and execution, for business sake.

A century ago Dadaists like Marcel Duchamp challenged the protectors of traditional painting with the question “What is art?”

Before you invest in advertising, social media marketing or any program to grow your business, ask yourself, is this commercial art for the 21st Century? Is the execution well enough crafted to connect with your audience and leave the desired impression? Most importantly, will it give you the best return on investment?

It’s a commercial decision after all, not a beauty contest, don’t you think?

Why CEOs like Facebook yet fear it

The 2012 IBM global CEO study is just out. It once again confirms management is often aware of what needs to change, yet fear acting on their knowledge. 

"CEOs need social media, but many fear it" – IBM

The world’s CEOs believe that in the next five years social media will push past websites, call centres and channel partners to become the No. 2 way to engage customers (after face-to-face communications).

However fear of change is preventing most from actually actioning a Facebook strategy. Many will miss capitalising on this inevitable trend to more agile competitors. Some fears are justified, there is no doubt there is risk involved with social media. Risk isn’t just bad ideas like CommBank’s terrorist Olympics viral video.

Advertisers are now liable for users' Facebook comments

Australia's digital industry is up in arms about a ruling from the ad watchdog, which determined a brand's Facebook page is an ad platform with all its material - including user-generated content - liable under the AANA code.

A recent ruling from the Advertising Standards Bureau (ASB) in a complaint against Diageo said it considered Facebook to be a marketing communication tool. The decision changes the landscape of social media advertising with brands liable for content generated by consumers.

In its ruling, the ASB wrote: “The Board considered that the Facebook site of an advertiser is a marketing communication tool over which the advertiser has a reasonable degree of control and could be considered to draw the attention of a segment of the public to a product in a manner calculated to promote or oppose directly or indirectly that product."

Social media advertising regulations and marketing your business

“The Code applies to the content generated by the advertisers as well as material or comments posted by users or friends.”

This is yet another example of how our regulatory frameworks are anachronistic in the era of the Internet. This new world of social media is merely a decade old, yet regulators like ASB are employing codes written in the steam age when ads were only mass distributed by printing press. Publishers had control of what letters to the editor were published with an eye on libel. But the pace of public postings on Facebook makes such a process for an editor of a business Facebook page less that of a publisher, more one of the town crier who invites people to the town square but can’t predict what the crowd will yell about loudest.

Right now the judiciary has similarly lacked an ability to adapt as the public circumvents contempt of court rules and out accused on Facebook, passing collective judgement before a trial. No blurred pictures of the accused’s face like in the press or on TV. Think the Kings Cross king hitter, perhaps fuelled by Diageo products. Lets see a post on a liquor brand’s Facebook about the next alcohol induced murder and ponder the consequences. It's going to happen, irrespective of what the ASB stipulates.

So if CEOs are going to increasingly use Facebook for a dialogue with prospects, we will need to be extremely diligent to keep on the right side of the law, irrespective of how sensible we think regulations are today.

Learn from Darrell Lea's Rocky Road

Darrell Lea's new Perth concept store opened in March. Too late to keep the administrators from the door?

Most business leaders know the 4 Ps from marketing 101. As Darrell Lea’s predicament shows, in today’s marketplace where change is underway at an increasingly blistering pace, keeping those easily understood basics working in your favour is becoming increasingly difficult. Here they are one by one:

Product

Mega trends like multiculturalism, gourmetisation of food products, better for you choices, and social issues like fair trade today shape what we choose to eat.

In the past it was enough to make minor adjustments to products and expect a sales lift simply by placing a NEW IMPROVED flash on the wrapping. For the last couple of decades there’s been little in the way of product innovation at Darrel Lea. As well intentioned as they may have been, small line extensions like fruit flavoured liquorice haven’t been enough to stop the sales decline.

Businesses have to be wary of who they entrust to give them independent counsel. Darrell Lea invested in research that resulted in a new tag line, “85 years of creating sweet magic”. One can argue this simply reinforced a backward looking management mindset.

Today customers are rewarding brave leaps forward in categories. As Max Brenner’s website proclaims, “Chocolate is not just about taste” it’s also about fashion. From Mexican spicy chocolate and hot chocolate shots to chocolate soufflés and Tiramisu, Australians are spending more money on chocolate than ever before as brands can come up with new adventurous ways to tempt them.

Challenger brands aren’t just new companies doing new things, old companies doing things differently are also being rewarded. Australia’s oldest chocolate maker/retailer, 97 year old family business Haigh’s has kept customers coming back and continues to entice new ones with adventurous new takes on chocolates.

Promotion

Cutting back on advertising for a short term cost saving is proven to come at a long term significant loss. Once a significant investor in advertising, Darrell Lea has been absent from mass media marketing for several years. It takes many years to build a brand and nanoseconds to damage one in social media. It pays to treat advertising as a compounding investment that pays an annuity in return.

Price

Too often price is only mentioned in the same sentence as promotion. It is in fact a two way lever. A 4 for $15 offer on Rocklea Road isn’t going to entice a new customer, it simply reduces the margin on a sale to an existing one.

Whereas Lindt, once considered a niche special occasion brand, has grown by offering a variety of chocolate balls across a range of pricepoints and product sizes that still maintain a premium.

Place

The Internet is making everyone reconsider where is the best place to make a sale? Ecommerce may not be right for a product that will melt in the mail, but is owning a shop the best alternative? Why own 63 shops when most chocolate sales are through Coles and Woolworths and convenience stores?

If you are going to have a retail outlet, it needs to have a good reason to justify the high overheads. Darrell Lea’s average over the counter sale is around $11 per customer. You’d need a lot of footfall to justify the rental on the King and George Street Sydney store. On the opposite corners are the eye candy Apple store and Louis Vuitton, where the products cost thousands (and are never discounted).

Challenger brands understand stores are the new 3D interactive ad medium. They are all about theatre and entertainment. Max Brenner has the theatre of their liquid chocolate Willy Wonka-esque stores.

Other retailers realise the store is simply the best way to gather new customers details for database driven online sales. The objective of the shop front is to entice prospects in and the brief to staff is to start a long-term relationship. For instance, banks lose money on physical branches, but haven’t found a better way to gain new customers. Citibank’s new branches in Hong Kong have been designed by the same architects as the Apple Stores. You can’t make a deposit at one of these new gleaming white banks with couches and interactive screens, you can have an espresso made by a barrista who is briefed to cross sell financial products to you.

How to stay competitive

Many market leaders are vulnerable to the threat that comes from failing to re-look at their entire business models. Simply reviewing the 4 Ps from the perspective of traditional wisdom will no longer ensure a business stays competitive. Market leaders that fail to embrace change, not just across product and service but entire systems and relationships, are increasingly less profitable than smaller challenger brands. There are a number of proven tools and techniques to help businesses rapidly adapt and trial new ways, feel free to ask us about some of them. 

Boston Consulting has formally identified what savvy marketers know is the driver of business growth today:

In a world of change, the spoils go to the nimble*

*Martin Reeves and Mike Deimler, Boston Consulting Group, 
Harvard Business Review July-August 2011

At 97, Haigh’s is Australia’s oldest chocolate challenger brand

Founded in Adelaide by Alfred E Haigh in 1915, Australia’s oldest family-owned chocolate maker/retailer has a history of embracing change.

In the 1950s grandson John learned from Swiss masters Lindt and Sprungli and introduced European fine chocolate making to Australians. The current fourth generation Haigh family management preside over a business that represents barely 1% of Australia’s chocolate sales. Yet I would venture to say they are very profitable.

By continuing to innovate Haigh's continues to prosper as a challenger brand

Their award-winning Australian Collection was launched in 2003, with six native food centres including quandong, macadamia nut and honey, lemon myrtle and wattle seed. And as Australian’s have become more sophisticated in food tastes, Haigh’s have kept up with such adventurous chocolates as a South Australian truffle duet made with premium wines from the State’s wine regions.

Haigh’s environmental policies and sponsorships are just one indicator of how in touch this old business is with today’s consumer.

Last August at the Family Business Australia Conference, Joint Managing Director Alister Haigh told me they were ready for the next big change - online sales. The only sticking point is developing a delivery method that can guarantee the integrity of their heat sensitive product.

Following the biggest fine in UK finance history, it’s timely to look again at Barclays’ Big Ad

Barclays agreed to pay a record $442 million fine for rigging the London interbank offered rate last month. The scandal has cost the jobs of Barclays CEO Robert Diamond (below), Chairman Marcus Agius, and Chief Operating Officer Jerry Del Missier.

It pays to consider the future consequences of a single-minded marketing tagline. For Barclays, “We’re Big” just doesn’t cut it anymore.               

If you're a marketer, Read This Or Die...

A friend sent me a YouTube link via Facebook – a comedy sketch by Bill Hicks, where the comedian asks anyone in the audience that’s in advertising or marketing to “kill yourself".

I was reminded of my profession’s tenuous grip on social acceptance when this week leading researchers Roy Morgan released their latest annual survey of how Australians rate the professions: ad people are still near the bottom, just above car salesman.

There is still hope for Admen and marketers – it’s about having conversations at the board level that explain in understandable terms how we can add value. This week McKinsey Quarterly published a checklist of 5 things that will help business managers get the best ROI from their marketing.

So for those who rate the wisdom of McKinsey's consultants, here in my words are the 5 tips that will make any CEO take you seriously.

1. What exactly influences our consumers today?

Mass media marketing to the masses is oh so yesterday. Thanks to the Internet, shoppers now consider options at more times in more ways, from reading online reviews to comparing prices when in-store using their mobiles. Once someone has bought something, they potentially become a reviewer themselves.

So how do you get into the new consumer's head? You can use anything from traditional research to online polls or social media tracking to get a better understanding of what consumers are now thinking about a category. The key is to be open minded about what you learn and have a management team willing to let go of accepted wisdoms.

2. How well informed (really) is our marketing judgment?

It was only a decade ago when traditional advertising was all that mattered. Marketers who new their stuff could make decisions safe in the knowledge what always worked in the past probably would tomorrow. And planned accordingly. Today you have to be able to recognise signals of change, and act on them. This means managers have to move out of their comfort zones and hypothesise, test new ways, then measure, analyse and adapt. Again and again. In McKinsey’s words there has always been a a need to define a “clear relationship between marketing spending and business results”. Today it has shifted from “should we be spending on marketing at all?” to “what’s the optimum marketing spending needed to hit our targets?”

3. How are we managing financial risk in our marketing plans?

Successful marketing communication takes hitting the right audience with the right message at the right time. The difference today is the targets are increasingly individuals and they are moving faster than ever. Traditional mass media allows advertisers to minimise risk by using metrics based on years of surveys that measure frequency and impact of a particular medium. Not so now. With today’s new media “influence can shift rapidly, and there is little accumulated experience about which messages work, when marketers should apply them, how they can be scaled, or even whom they influence”.

Measurement and risk reduction today comes from a closer relationship between sales and marketing and the channel. One of our clients has found scan data has new meaning now it can be overlaid with pre and post campaign brand tracking and the incredible analytics available using Shopperpedia.

4. How are we coping with added complexity in the marketing
organisation?

If you think it’s hard to keep up now, it’s only going to get harder faster. McKinsey's unsurprisingly suggest “you’ll require a number of specialists. You can’t get the skills and knowledge you need in just one person, and you’re not likely to get everything you need internally”. 

5. What metrics should we track given our (imperfect) options?

At this point McKinsey goes into a whole grab bag of consultant speak. At UNO we think it best to get back to business basics – success should be measured by profit, not volume of sales or market rank. A business is successful when it can compete on more things than just price. And it knows it’s a real challenger brand when staff and partners are aligned and customers are referrers.

Now if you’re in advertising or marketing and you can’t get your head around the idea you have to change to survive, take a couple of minutes to laugh out loud as Bill Hicks encourages you to kill yourself

Where the smart budgets are being spent...Social Media

Have you noticed over the last decade that just about anything that isn’t nailed down has been digitised. Today we can access nearly everything from anywhere on anything – from getting the news on a tablet, trading shares on a mobile or accessing software services from the cloud. Plumbers are relatively safe, but most other businesses have to change.

The difficulty for business managers though is not just deciding how to make the change to digital, but how to make money out of it...

Pew Research Centre in the United States found that digitisation is burning money

Newspapers lost $10 in print ad revenue last year for every $1 they gained online. Just five companies, none of which existed a couple of decades ago are now taking 68% of online ad revenue: Google, Microsoft, Yahoo, AOL and Facebook.

Marketers know that they need to integrate traditional mediums with digital. Few businesses actually do – and some still think online is primarily for brands with young customers.

Businesses may be surprised to discover that the place where Australians spend the most time online, is also the most popular with women 25-45 years old.

The papers continue to spend money on journalists and creating the content, while these new companies continue to grow their revenue off the papers’ labours. Now because of their growing databases, fuelled by an understanding of people’s behaviour and preferences gathered from social media use, the digital intermediaries can now target ads more precisely than the old publishers.

The things we can now do on Facebook are incredible. In the past only advertisers who could afford to buy expensive data and research could precisely target their consumers. Now any advertiser can pretty well plan as effectively as the global giants by tapping into the growing wealth of intelligence of the social media technologists.

The Pew report says: “Two trends in the last year overlap and reinforce the sense that the gap between the news and technology industries is widening. First, the explosion of new mobile platforms and social media channels represents another layer of technology with which news organisations must keep pace. Second, in the last year a small number of technology giants began rapidly moving to consolidate their power by becoming makers of 'everything' in our digital lives. Google, Amazon, Facebook, Apple and a few others are manoeuvring to make the hardware people use, the operating systems that run those devices, the browsers on which people navigate, the e-mail services on which they communicate, the social networks on which they share and the web platforms on which they shop and play. And all of this will provide these companies with detailed personal data about each consumer.”

Business journalist Leon Gettler points out “Newspaper groups like Fairfax are the canaries in the coal mine for other industries facing similar challenges, from book shops and publishing to health care, industries where barriers to entry are low and where information is the main product. The trend to digitisation will accelerate with 'Generation C', people born from 1990 on who expect to be constantly connected through every possible device now entering the workforce, and with costs of computing and technology equipment dropping.”

“In every organisation, from media to retailers like David Jones, Myer and Harvey Norman, the biggest challenge always comes down to the tension between those who advocate a more aggressive approach and those aligned with legacy traditions, those who want to go fast and those who want to slow down.”

Adaptability: the new competitive advantage 

As the pace of change accelerates, adaptability becomes the new competitive advantage. Long established leaders like Kodak, Borders and Fletcher Jones are a lesson in what management can expect if they don’t change their business model to integrate digitised marketing with their traditional methods.

Sources: Leon Gettler, Business Spectator, 28/3/12
Pew Research Centre, How Newspapers Are Faring Trying to Build Digital Revenue, 5/3/12

Why are marketers using Smartphones today?

The answer is in the numbers, and is a pointer to the next big thing.

Google researched 300,000 people around the world to find out their Smartphone use. Now as Australian marketers we can compare and contrast markets.

Number 2 for Smartphones in the world
Australia is now ahead of the US, UK, and Japan.

Average Smartphone under 12 months
Most of Australia’s Smartphones were purchased in the last 12months. We’ve gone from the back of the pack to the second highest penetration of this technology in the last year. Every month 1-2% of the entire population of Australia buys a Smartphone.

81% do it at home
More Australians used their Smartphones at home during the past 7 days than out – just 66% use them on the go.

50% like to watch
Almost 1 in 2 use their Smartphone while watching TV, while 1 in 3 use Smartphones and another Internet-enabled device at the same time. Talk about adult ADHD media consumption.

Smartphones are good for business
49% use their Smartphone to research and then call businesses – and 45% visit a business they’ve found using their Smartphone.

Aussies are obsessed with real estate
The stats confirm what we’ve all known from dinner party conversations – 1 in 5 Australians surveyed had looked for an apartment or house with their Smartphone – that’s 33% higher than the US or UK.

40% search daily
2 in 5 of Australian Smartphone owners use mobile search daily, that’s more than the UK or Germany and almost as high as the number who use desktop search daily.

The number of queries about retailers made via mobile devices has jumped 220 per cent year on year, and is now about 25 per cent of all queries.*

App, app and away
Australian survey respondents had 25 apps on average per Smartphone, Vs 23 in the US & UK. We’re not just talking free apps; Australians averaged 8 paid apps per phone.

TV or not TV?…
1 in 5 Aussie Smartphone owners would rather give up their TV than their Smartphone.

Better than sex?
1 in 3 say so according to a Telenav survey, that’s how many would choose their Smartphone rather than sex.

Now you’re up to speed with the omnipresence of mobile you’ll need to start thinking about how you can extend your online activity beyond a website that is viewed on a PC.

But wait, there’s more. Nothing stands still nowadays; to keep up you also need to be thinking of how to stay ahead of the competition.

So what’s next?
In just a year Australians have learnt to surf the web, send emails and watch movies on a Smartphone. Now consumers are moving to tablets because they are more convenient than laptops and obviously have a bigger screen than Smartphones.

1.2 million this year
In 2011 tablets will outsell Smartphones in Australia. 64 million tablets will be sold worldwide by the end of this year. #

73% of them will be iPads
Apple will sell 47 million iPads this year.#

We believe video to mobile devices is a game changing opportunity for challenger brands. Until now many marketers have been held back by the high cost of entry of mass media advertising. The amount of media consumption online has risen from 25 per cent in 2007 to about 42 per cent now. A new buzzword for marketers in the US is ''SoLoMo'' – as in social media, local networks and mobile. Savvy marketers are recognising the need to develop strategies that make the most of these new, powerful mediums. *

We believe you can now punch above your weight more effectively than ever by integrating video and content to create a genuine one-to-one dialogue on customers’ mobile devices. You’ll be surprised what is now possible…
50% conversion rate

50 per cent of people who inquired about a hotel via a mobile device went on to make a booking within a couple of days, compared with 20 per cent for those online via a computer. *

Give me a call on my Smartphone, 0412 982 538, if you’d like to know more.

*Ross McDonald, Google, 9/12/11
#Gartner, 8/12/11

"Greenwashing" Why a great idea that isn't true is a bad idea

What a shame this great ad for Steggles wasn’t for a producer of real free-range eggs. It was pulled because it’s a lie, even though beautifully told. Every person in every agency should be stegglers for detail.

The public deserves better than marketers passing off intensively “farmed” produce as free range when there isn’t room for the animal to scratch itself. “Greenwashing” takes many forms, like adding the claim Hormone Free to chicken packs when it’s been illegal to add hormones to any farmed chicken in this country since 1968.

At the moment here at UNO we are working on a campaign for an Australian innovation, the first plastic to biodegrade in modern landfill, which is where a billion disposable coffee cups end up each year across our country. We have told our client he can succeed as a challenger brand by telling the truth. There will be no green washing, just the facts about what this product can and can’t do. And we’ll do that the way all ad people should, with creative wit and human insight.

J Walter Thompson’s words of over 100 years ago are as right today as ever – “The truth, well told” is why we get up in the morning.

See the vodcast about what makes biorene biodegradable – the Earth eats it up!

Trust me, I'm in advertising...

10 years ago when I started my own agency, an account director mate left the industry to become a real-estate agent. I remember thinking it was the only place he could go that had a lower standard of trust than we advertising types. 

Last week he told me it was a great move financially, he reckons 99% of people in advertising are really smart, whereas he’s happy competing with the 99% of real estate agents he’s found to be really ordinary. If we are that smart, why can’t we lift our own profile, beyond the bottom of the heap for trusted professions?

Trust in advertising? This is not an oxymoron.

Unfortunately, the perception of our industry is on a par with used car salesmen, yet our legal obligations, indeed our personal liability, dictate our practices are squeaky-clean. 

In Australia, like most things, our industry is regulated and kept on the honest path by a series of laws and regulatory bodies. You wouldn’t know it. 

The 2011 senate inquiry into outdoor advertising standards found only 0.01% of ads were found to be bad, i.e. sexist, likely to offend or straight out untruthful. Yet when prompted on ABC radio, the senator leading the inquiry said that if we don’t clean up our act under self regulation, he’ll "pull out the big stick and regulate" us. 

Would you trust a politician to decide whether marketers are trustworthy? 

In Europe, clergy are experiencing a decline in confidence levels and politicians are in last place. Our peers don’t rate much better than we do here, with over half of Europeans surveyed* saying they don’t like journalists, marketing specialists or advertising experts.
*Source: GfK Trust Index in spring 2010 

I can understand why journalists are suddenly on the nose – the phone hacking scandal at Rupert's tabloid News of the World has in the words of one shareholders action group "laid bare a striking lack of stewardship and failure of independence." The board had been unable to set a "strong tone-at-the-top" about unethical business practices. 

Australians generally are a trusting lot. When it comes to believing what our fellow citizens say, Australia on a trust index score of 92 ranks ahead of the U.S. (78.8) and U.K (61), just behind New Zealand (102) and way behind China on 120.9. 

Source: ASEP/JDS data bank 2011

So where do Australia’s “ad people” sit on the trust index today?

Who we really trust is no real surprise:
1. Paramedics
2. Firefighters
3. Pilots
4. Rescue volunteers
5. Nurses

At the bottom of the pile are
41. Taxi drivers
42. Real estate agents
43. Car salesmen
44. Politicians
45. Tele-marketers

Source: Readers Digest Austrlalia’s most trusted professions poll 2011

Before you think ad madmen aren’t so bad after all, the only reason they’re not last on this list is because they aren’t included in the survey. Tele-marketers are the closest category, so let’s just accept advertising and marketing guys are way down there. How did we end up down at the bottom with pollies, and what do we need to do to elevate our role to a similar level of respect as other service providers like engineers, doctors and architects?

Advertising first took off in America in 1800s when snake oil makers discovered the return on investment of promoting something of little value with amazing claims in the press. In Australia last year the most damage to our credibility was the public complaints about the posters advertising Advanced Medical Institute’s cure for under performance in bed. It was bad enough they were bad ads, the real breach of trust was the pitch was a fraud. Most of those with a desire to last longer in bed were overcharged for a treatment that generally didn’t deliver on the promise.

As a professional I feel we would be better off refusing to work for these types of people. It didn’t harm Bill Bernbach’s career when he told prospects he wouldn’t accept their business if their product didn’t live up to his standards.

(Glenn Mabbott would like to declare his interest as a sitting member of The Communications Council’s Policy Committee, which aims to raise industry standards through the Accreditation Scheme. UNOmarcomms was one of the first independent agencies in Australia to gain accreditation.)               

Are today’s retail ads bland, bland, bland?

Are today’s retail ads bland, bland, bland? This was the question posed by AdNews last week after Dick Smith launched a new brand style ad campaign. If you missed it, here is a cut down of my contribution to the debate.          

Dick Smith was an innovator

He built a new category with advertising and brochus that gave Australia’s cardigan wearing tinkerers access to an Alladin’s cave of electronics stuff to play with in their garages. What proved Dick really clever was his ability to sell his growing challenger brand to Woolworths and then go on to innovate time and again. With Australian Geographic and then his Australian Made products, Dick was a natural at creating marketing campaigns that resonated with the public mood of those times.

Contrast this with another retail innovator of Smith’s era, Gerry Harvey. Gerry also made his first million in his early twenties with ads for whitegoods and appliances that yelled, “Why pay more?

Is Gerry a clever Dick?

Gerry didn’t sell his business and continues to be the biggest retail advertiser in the country with ads that follow the same tired formula of thirty years ago. We all know the pitch: yell loud enough and people will rush in to grab a bargain. Except increasingly we’ve learnt to treat those ads as repetitious nagging. We’ve moved on to better retail experiences, which are likely to be online.

It’s time the majority of retailers looked at the current crop of retail innovators, like Net-a-Porter that has just released a new magazine iPad app that makes shopping an exciting, contemporary experience. Or this great campaign in Korea for Tesco’s challenger brand, Home Depot.

This article first appeared in AdNews, 21/10/11

A lateral way to increase retail shelf space: use a billboard

Watch this short video of how Tesco challenged the number 1 retailer in Korea by creating a virtual store.

What’s the next killer app?

The latest stats show Australians are the number 2 adopters of smartphones. And this year, Tablets and iPads are set to outsell mobiles, Australians will buy 1.2 million of them*. In the last couple of years the fastest increase in marketing online has been with using video, so we believe the next big thing for marketers will be video over smart mobile devices.

Ask us about the app factory that will let you make the most of video content. (Soon to be launched by UNO with our partners at Mass Media Solutions.)

*Telsyte mobile device update 2011.

73% of CEOs think marketers "Lack Business Credibility"

According to damning research by the Fournaise Marketing Group, marketers are not the business growth generators they should be.*

The gist of the findings of an Asia wide survey of CEOs is that management believe their own marketing departments are in a world of their own. They believe marketers speak in jargon and are not contributing any value to the business. From my experience you can’t blame most business owners for thinking this way, especially in Australia. Too few businesses have ever had a good marketer sitting round the table at board level, championing the power of marketing to generate wealth.

Marketers need to talk the language of business outcomes

As in “how can marketing get a better return on investment”. Otherwise marketing will remain a misunderstood black art not worthy of the attention of three quarters of CEOs. The vast majority of businesses will thus miss out on the huge opportunities that insightful marketing can deliver when it is woven through the entire business process.

Meanwhile there are a handful of businesses doing better than the rest because they have value-adding marketers on the team. These marketers, obsessed with return on investment, are recognised as an integral part of the senior management team. They are helping their businesses punch above their weight in the following ways…

• Overcome competition based purely on price
• Prevent decline of sales
• Hold on to existing customers
• Build qualified sales leads
• Change the perceived quality of a product
• Revitalise tired brands
• Boost staff morale
• Speed the development of new markets
• Speed product trial and acceptance
• Help businesses raise capital more easily
• Build the value of a business for sale

ROI marketing works

For 100 years Coke has proven it, people from first world countries to third choose Alabama’s black sugar syrup even though it doesn’t taste as good as Pepsi’s. That’s the power of consistent marketing. Perrier taught us to pay more for mineral water than petrol. Branson has convinced Australians to fly Virgin despite having a deplorable record of taking off late, (and you still have to pay for your sandwiches). And thanks to marketing Apple has built a brand that is hugely profitable, marketing has enabled them to sell often inferior spec’d products at a premium to specialist manufacturers like Nokia and HP.

CEOs needn’t fear marketing speak. Business decision makers who embrace marketing with an open mind can still enjoy a sense of control by implementing a test and learn approach. Any marketer worth listening to understands the value of having the results of their work tracked. If it isn’t measured, it isn’t managed. A marketing program that IS managed WILL deliver better results than mindlessly sticking to what the company has always done, or jumping blindly into the latest thing.

ROI Marketing can make a big difference to any sized business, in any category

So what can ROI marketing do for you? My experience has shown me whatever the category, from Watties baked beans to Brita water, Splash Clinic cosmedical treatments to City Index CFDs, a test and learn marketing program can turn good businesses into category leaders.

Two thirds of Australians are using social media. Two thirds of those use it to decide what to buy.*

Social Media Marketing (SMM) is growing, the latest figures show Social Media is becoming a mainstream influence in the purchase decision process. UNO are members of the Australian Interactive Media Industry Association. Together with Sensis, AIMIA surveyed 803 Australian consumers and 1,944 Australian businesses to determine how social media channels are being used. 50% of corporations now have a social media presence, the majority on facebook. Just 14% of small businesses use social media.               

Proportion who have Social Media presence

Proportion who have Social Media presence

Social networking site usage by age and gender

Here are 10 ways you can make more of Social Media in your marketing communications mix:

1. Start now for free. If your business is consumer facing, get a facebook page, it’s free.
2. For B to B, skip facebook. Focus where business decision makers are active. Join LinkedIn. Follow relevant associations and groups, join industry forums and post comments on articles.
3. Share your knowledge. Your business is your passion; tell it how you see it where you can add value to a conversation. No need to sell, just build your credibility as an expert and you’ll be increasing the standing of your businesses.
4. Don’t post as anonymous. Out yourself. The CEO of a solar hot water manufacturing company follows chatrooms where plumbers share advice. His comments to tradies‘ questions demonstrate he’s in touch with his market. I suspect his competitors are unaware such forums even exist.
5. Put someone in charge of your Social Media. Empower a person within your business who is passionate and keen to have a dialogue with customers. If you don’t have anyone internally, outsource.
6. Tweet. Reinforce your position as an industry expert by tweeting and re-tweeting about relevant content that others have shared.
7. Blog. Blogs and reviews have a big influence on buying decisions, with 63% of social media users reading reviews before making a purchase decision.
8. Be regular. Respond quickly.
9. Integrate social media. Integrate content with your promotions and product campaigns. Measure. Track.
10. Video is the future. It’s the fastest growing area online because it’s easy to share. It’s not enough to post a television commercial on YouTube because no-one will look for it. Be creative, film an interview with an expert, or shoot a behind the scenes glimpse that showcases something you do well.

Social Media can deliver a measurable ROI. No wonder businesses are spending 5% of their marketing budgets managing and creating content for social media.               

Did you know it’s 20 times easier to sell to an existing customer than a new prospect?

The good news is that any business that has collected data on their customers is sitting on their own potential gold mine. Rather than spend money trying to appeal to new prospects by running press or even online ads, you will get a much better return on investment by adding some intelligence to the way you manage your data.

Give your CRM some Data Intelligence

Most data is in such a mess it offers little insight to business owners. To turn it into a powerful tool to enable you to communicate with your customers requires a clean, intelligently organised database.

The place to start to release the value from the mountain of data you already have is to give it to an expert to wash it.

You’d be surprised how many emails and addresses are wrong, repeated or out of date. You can’t begin to measure response rates until you know the data you have is clean. It’s better to measure the response from 10,000 real customers than to assume you’re sending offers out to say 30,000 on a dirty list.

Once you have a clean list, your data then needs to be structured and categorized with the aim of maximising its usefulness for marketing purposes. There are then some things you can do straight away to not only deliver quick profits today, but also set you on the path to delivering what customers will want in the future.

Fast profits can come from testing and tailoring offers to:

• up-sell, getting customers to buy more valuable products from you
• cross-sell, encouraging them to add something else to what they usually buy from you
• increase purchase frequency, by building loyalty and giving them more reasons not to be tempted by your competitors

So get the experts in quick smart to professionally clean your data so you can secure the future of your business. Let those who continue to spend big to tempt new prospects pay the price.

You built a website. You embraced e-commerce. So where is the massive lift in sales?

What will it take for retailers to stay in business in this rapidly changing global economy? Futurist Ross Dawson commented in a recent blog that if you expect your business to look the same in 10 years as it does today, expect to be out of business.

Who’d have thought ten years ago that Woolworths would be the biggest owner of pubs and bottle shops today? Constant change is the only way to stay competitive, which explains why Woolworths just bought Cellarmasters for $340million. Kevin Luscombe recognises the future includes database marketing, Cellarmasters “will enable us to serve a whole new customer segment in terms of the direct marketing channel.”

eCRM drives online sales

Cellarmasters has the largest databases of drinkers of premium wines in Australia. For any competitor to stay in the premium wine business they’ll need to at the very least match the way they apply an eCRM program to their database.

Once a database has been professionally cleaned, you can start to mine your database and build a series of profiles of your customers. Using that intelligence will deliver a better ROI on your marketing. You’ll get a better result cross selling Pinot Gris to customers who are heavy purchases of Sauvignon Blanc. With profiles of your customers it becomes practical to promote a 20 case limited offer Coonawarra cleanskin, you simply email your regular purchasers of Cabernet. With data intelligence, while you offer a bonus with purchase of single malt to spirits drinkers, beer drinkers automatically receive a different offer.

Very few customers want to be constantly bombarded with promotions that are obviously being sent to the masses. They will reward targeted offers that demonstrate you understand them as an individual with stronger loyalty.

Your customers know what they like and will actually tell you what they want if you bother to track their behaviour, or quite simply ask them. Every marketing activity, from a mailer or catalogue to a visit to your store, each phone enquiry and every online order is an opportunity for you to measure what works and what can be improved.

ROI marketing will drive e-commerce

Every dollar you spend on marketing should and can be measurable. You don’t actually have to be a futurist to stay in business, with data intelligence you can keep track of where your customers’ needs are leading and continuously adjust and improve to keep up with them.               

You can be tomorrow’s business success story. Just add Bernard Salt

Bernard Salt earns a living as a demographer. That’s the art of taking research data and painting a picture of who we are and what we think and do. Before you tune out thinking he’s just another propeller head making money off the back of lies, damn lies and statistics, consider for a moment what you’d give as a business to know where the next big opportunity for making money is, before it happens.

How do entrepreneurs know where to invest today in what will be the sweet spot tomorrow? What did the savvy few who bought franchises in McDonalds in the eighties know? Or the food services that were ready to be part of café culture as we left tea drinking behind?

If you were a tea manufacturer in the 70s Australia’s demographics could have predicted that your volumes were about to decline. The move from a society of tea drinkers to the blossoming of café culture at the turn of this century was a consequence of something that happened in the 1950s. The wave of immigrants from Italy and Greece post war had kids, grew wealthy and infused our Anglo society with a Mediterranean café culture which saw Australians move onto the footpaths and embrace machiattos and cappuccino with biscotti in preference to sitting indoors with a cuppa Bushells and an iced Vovo.

At a Family Business Australia breakfast, Bernard explained the simple truth that the composition of Australia is what drives business growth. And decline. Seems obvious, yet even the high fliers at BHP and the big four banks pay Bernard to keep them abreast of what should be self evident. It’s easier to grow a business and be profitable in a category of growing demand than to compete for a share of a shrinking one. 

Change managment – there's money in tea

Follow the demographic trends that will shape what Australians will look like in the next decade and consequently what consumers will be asking for. Today there is a shift away from European immigration to Asian as these stats on fastest growth and loss by place of birth show.

Prediction: Start thinking about tea and noodles not coffee and pasta.

Super was yesterday’s money maker

In the last decade the biggest growth in financial services has been in superannuation. The SMSF category has doubled its share to be the largest segment at huge cost to growth of retail funds as boomers take more interest in their money in super. Industry funds have also grown share with a low fee proposition and the locked in stream of contributions via the super guarantee levy from a membership base that traditionally wasn’t saving much. But that’s today’s boom business, tomorrow it will change, again because of a shift in demographics. 

The makeup of working Australia is about to fall off a cliff, as the boomers retire and are replaced by… no-one:

The age at which boomers will retire, now on average 58, as well as the length they can expect to live has also profoundly changed in just a generation:

Prediction: Cashed up retirees who will live for 20+ years will want to travel, eat out, be entertained, live in a city apartment or by the sea and to pay for it all need a retirement pension plan that will last the distance. They’ll be looking at ETFs and annuities. 

Bernard Salt has a pretty good idea of what tomorrow looks like. It’s up to you to see how you can position your business today to be ready to reap the rewards of a growing market category before it’s the next big thing.

Does your business have a brand policeman?

When did you last check your brand imagery and how consistently you are projecting your business to customers and stakeholders? Have you done a complete audit of all your “touch points”? Who in your company has the authority to enforce standards?

Large corporations have entire departments looking after how the image they present visually. They have realised the value created by consistent repetition of the company brand marks alongside the product or service it delivers.

Most businesses fail to present themselves as professionally as big brands and end up with a brand “look” that has more in common with a camel than a racehorse. This occurs organically, by allowing too many people to make piecemeal decisions every time something is needed.

There are so many pieces that make up the complete picture of your brand, from a new business card to printing a brochure or sending an email offer. Each is an opportunity to build brand “credits”, or a risk for someone to go off on a tangent.

A complete audit of all your brand “touch points” would cover:

• Internal signage
• Building signage
• Banners
• Vehicle signage
• Advertising
• Email signatures
• Website
• eNewsletter templates
• Fax formats
• Letterhead
• Business cards
• Presentation folders
• Flyers
• Sales force and sales kits
• Product sheets, warranty forms
• Order forms
• Invoices
• Branding on your products
• Point of sale
• Price tickets and notices

Setting brand standards with a professionally developed Style Guide

Brand guidelines (also called a Style Guide) should cover all of the things in the list, and have specific rules for each element. For instance, how your logo is used would cover these specifications:

Colours
• Print: CMYK or Pantone reference 
• Digital: RGB 
• Mono, reverse, 
• Vector files for artwork production. 

Size guidelines - how small can it still reproduce?

Usage guidelines - clear space, location on the page, hierarchy with other symbols.

A Graphic Designer with credentials in this area can produce your Style Guide.

Enforcing your brand style

Your creative agency can act as your deputy and arm you with a password protected online archive of logos, images, artwork formats and templates.

Many businesses also find having a professionally developed Style Guide available, as a reference document for staff and suppliers, helps enforce brand rules making it easier to keep the company image under control.

Finally, someone qualified within your company needs the power to enforce the Brand guidelines. It is possible to mandate that all work using the company brand mark is approved by this person before it goes into production.

Success through consistency

Every business can benefit from designing formal brand “rules” so they can weave simple and consistent imagery through the company’s everyday operations. If you have a good product your customers will come to associate that product with your consistently delivered brand mark.               

Does your strategy need to include e-commerce? What would Gerry Harvey know?

There’s more to ecommerce than GST

Funny how Harvey Norman and other retailers are running to the regulator with the sob story that they are losing sales to overseas online providers who don’t pay GST. Time for a reality check, they are losing sales because they are slow in changing their business models to keep up with consumer behaviour. 6 months ago I flagged the stats showing how quickly online sales were growing and the failure of our retailers to keep up with the trend.

Consumers reward innovation

It’s how Gerry Harvey made his first millions when, in his twenties, he founded the first category killer electrical discount store, Norman Ross. You don’t have to be young to be innovative; you just have to give consumers what they want in new and exciting ways. Today consumers increasingly are researching and shopping online. In a few years what they want will be something most of us have yet conceived, and more than likely Apple’s Steve Jobs, aged 55, already has in development. 

Facebook keeps growing. So how can you make the most of it?

Facebook has broken through the 10 million barrier of active users in Australia*

While this will prompt many to jump in and increase advertising on Facebook from the current $12million a year, content is the cost-effective way any marketer can gain exposure to this increasingly significant audience. Best make sure it's the right kind of content.

Online content is King

When publishers and marketers say content is king, what exactly do they mean? Here’s an example close to my home. When I was 20 I played occasionally in a punk band called The Coathangers. Most nights we were lucky to get paid in free beer, the cover charge might be a couple of bucks. One night we had 6 bands for 69c. It was accepted that routine you played for little or no immediate return to build up an audience. Later you would then sell records to them, which was where the money was. Your loyal following paid for content.

Today you can’t expect to sell many CDs when everyone can download your content for free. My 21 year old son has a new band, The Psychonaughts. They hardly ever play live, they are busy recording, creating content that will more than likely be given away. In the not too recent past a band would build a website that fans would visit to purchase songs and buy merchandise. Not any more, people expect everything online to be free.

So what’s the value of giving away content online?

In the case of music, the content gets passed around and builds an audience, who then pay to see you perform live. Technology has turned the model upside down.

The ease with which people can share content across social media is a lesson for brands – we are now in an era where you have to produce content of value to your target audience, making it available for free. It then requires like-minded prospects to share it by whatever medium they choose: YouTube, mobile-to-mobile, email, or increasingly, Facebook.

According to Facebook regional vice-president A/NZ Paul Borrud, globally two-fifths of the more than 500 million Facebook users are accessing the site through their mobile. And Australians spend longer on the site than anyone else.

Unlike marketing via your brand site, or Google adwords, or banner ads or traditional mass media advertising and PR, the consumer isn’t being paid to publish your message. For content to be spread it isn’t enough to post brochure copy or press releases, content needs to be engaging stuff that your customer sees value in. And by aligning this free content with your brand story you can build a relationship with prospects stronger than an advertising approach could ever achieve.

So the art is producing content that is worthy of the attention of your audience, something they want to share.

* SMH.com.au 10/12/10