MEDIA MUNCHIES Hilary Barry
I wake up to a radio alarm, which is set on The Breeze, because you really, really need easy listening music when it’s 3.30am. I also have the alarm set on my iPhone, in case I sleep through the first one. I never miss an episode of 3 News or 3D. I love The Good Wife, Veep, Mad Men (still in mourning after the final episode) all of which are recorded on MySky for viewing when time permits. I listen to lots of music off my iPod, via the Bluetooth in the car. I’ll often listen to CDs in the car too and also radio, which I switch between Radio Live, The Edge and The Breeze, depending on my mood and whether the kids have hijacked the tuning button. My music tastes are pretty eclectic; I’ve got Ray La Montagne, Lydia Cole, Tiny Ruins and some really bad/good ‘80s ballads. I don’t own a kindle because I love reading real, paper books. I’m old fashioned! I rather enjoyed Sue Monk Kidd’s latest The Invention of Wings recently. Yes, Twitter mainly, which I find quite entertaining at times. I use Facebook as well but it’s like driving your Nana’s Honda Jazz after you’ve spent a lot of time on Twitter.
and The Listener in equal measure.
AirNZ and Shopstyle. Browsing online fashion websites/apps. When the kids catch me ogling shoes again, I feel like I’ve been caught with my hand in the candy jar.
Nothing. Silence is golden.
The other mother of the nation has been reading the news (and cracking jokes) at TV3 since 1999 and took the brave step of signing up as newsreader for The Paul Henry Show this year. Here’s a taste of her media diet.
“Given the long gestation period for insanely expensive brand ads, I’d hazard a guess that the good people of Denmark, Turkey or Peru were treated to a touching wee cinematographic number featuring the tragic loss/ heartwarming rescue of a baby lemming/hedgehog/python by a soft-centred-but-clearly-hetero chappy sometime around, um, last September. At least the rest of us get a little smile out of their embarrassment.
One night while tossing and turning awake after a massive business setback of my own during the global financial crisis, I took my own remedy and had the best night’s sleep I’d had in a long time. It dawned on me that I mustn’t be alone in this struggle for sleep during this tough financial time so I decided to make SleepDrops available to the public. Not having enough money to get the business off the ground. Like most start-ups I had no money so I had to print labels and hand pour bottles at home. Every cent made went back into building brand awareness. Lack of money also hindered product development. It took two years to finally have all five products launched, even though all of the formulations were ready and waiting right from the beginning. After two years our internet sales were steady but we were being asked to consider making the products available for retail. We had to create demand for the products before the stores would agree to stock them. It was risky, but using our entire marketing budget, we drove customers in-store instead of to our website, without actually having product in-store, in an effort to create demand. It was tough going in the beginning but paid off quickly as SleepDrops had one of the fastest retail “take ups” by pharmacies for a previously unknown brand in New Zealand. It’s such a widespread issue. Around 50 percent of the world’s population struggle with sleep issues, so I wanted to help people and sleep was the obvious choice to make the biggest difference in people’s lives. We have a strong presence across all media platforms to maximise brand exposure. Our main marketing channel is radio with regular print and periodic TV ads to back this up. We create new radio ads every month or two so that we can keep our messages relevant and timely. We constantly invest in our website experience, we keep in touch on Twitter and Facebook, and we use Adwords. Basically, we want be anywhere our customers are. We want to be first to mind when people think of sleep products. I believe it’s about having a multi-pronged approach. We understand our market and we make a product range that actually meets our consumer’s needs. We have a committed and strong advertising campaign that doesn’t just try to sell product, we raise awareness, and I have the very best team of amazing and dedicated people who care about the difference we make in people’s lives. Innovation is incredibly important to us. We feel that creating a range of products that can help all ages sleep better without creating toxic side effects or dependency is both awesome and incredibly innovative. Research and development is important, so we spend a significant percentage of our budget on it. Currently we are working on growing sales for the existing product range but we have a few new products that might be in the works soon. We recently exhibited at the Natural Product Expo West in California and since then have had an incredible amount of interest in taking the SleepDrops range global. We are currently in discussion with distribution partners in both China and the US, and already have distributors in Singapore and Hong Kong. The simple answer is no, it’s not fair. Doctors are trained in drug therapy disease management and there’s definitely a time and a place for that. But there’s also an opportunity for naturopathic treatment, which is very scientific. Most modern naturopaths are trained in research, analysis and nutraceutical therapy. There is a wide body of research with numerous clinical trials showcasing the efficacy and benefits of all types of natural medicines in humans and this information is easily accessible to the public. Natural remedies have been used for many centuries, long before conventional synthetic medicine was in use. The way media report on natural remedies needs to be addressed as well. We do not see any benefit in challenging other scientists’ perspectives on natural remedies. We are a company interested in getting the best results for our customers.
PR is a key part of our business strategy. We work closely with our PR company to obtain exposure through the media and take up opportunities to promote the SleepDrops brand
Whittaker’s and Lewis Road Creamery nailed it with their chocolate milk and now Whittaker’s is hinting at a Jelly Tip chocolate blend with “leaked” images of what appears to be the new packaging doing the rounds on social media. It also uploaded a picture of J H Whittaker with some wobbly jelly on his head to its Twitter page and asked fans to keep an “eye on July”. Mmmm, co-branding. NZ Post has been battling hard over the last few years as traditional mail is increasingly being left behind for digital communication. But it’s trying to bounce back, evolving its business with new ideas like YouShop and YouPost and with its new campaign, ‘You Can’ it’s focusing on what it can do for businesses as a supplier. Those who recently lost their jobs weren’t happy about money being spent on an ad, but the new TVC shows a fresh and hip new face for NZ Post and also features actor Charles Dance, which should make people pay attention to the changes. Restaurateur-turned-philanthropist Michael Meredith launched Eat My Lunch recently, which uses the buy-one, donate-one model. Those who order a packed lunch will automatically donate another lunch to a Kiwi kid who would otherwise go without. Meredith teamed up with Iaan Buchanan and Lisa King to aid the one in four New Zealand children who live in poverty and go to school hungry every day. Eating never felt so good. Like many, we’re still mourning the loss of Campbell Live, which screened its last episode on 29 May. A new current affairs show is scheduled to take its place soon with more than one host and a softer, lighter approach. But as it wasn’t ready, Campbell Live was replaced with Road Cops and then Come Dine With Me, which lead to much derision being sent MediaWorks’ way on social media. When it rains it pours. And it’s currently raining rabbits and pigs. In a case of unfortunate timing, Vodafone’s lost pig called Piggy Sue and BP’s cute fluffy bunny were introduced recently (nothing like cute animals to distract the public from oil spills). And while it’s not unusual for ads to use animals, won’t someone think about the ugly ones? Where are the hideous looking deep sea creatures? They don’t get any love. We have also noticed a distinct underuse of manta rays in advertising. And we demand action.
During one of the recent U20 World Cup quarterfinals, German defender Robert Bauer smashed a ball into the advertising barricade surrounding the pitch. It remains a mystery which barricade the ball thundered against or even why the player obviously in need of anger management classes lashed out, but the Clax likes to imagine that the ad belonged to McDonald’s or Coca-Cola and that Bauer was making a statement that these brands don’t belong anywhere near a major sporting event, especially when young’uns are involved.
Seriously, if you were to type sport into the antonym searcher on Dictionary.com, it would almost certainly spit out big food brand names. And yet, despite sport and Big Macs being about as compatible as Cadbury’s chocolate and vegemite (this atrocity is also due a slap), unhealthy brands can’t help but attach their sticky/greasy logos to sporting events and initiatives.
You know why you never see a football player downing a Coke at half time? Because every person even remotely interested in sporting performance knows that Coke will do very little beyond increasing the viscosity of your saliva.
Sure, you have exceptions to this rule. Sports drinks were made for sports (but most people drinking them seem to be trying to cure a hangover). And sports people aren’t immune to the allure of greasiness. Usain Bolt claims to have eaten over 100 chicken McNuggets a day while in Beijing for the Olympics. But, as his superhuman speed can attest, Bolt is anything but ordinary and he admits that his training diet is essentially the antithesis of healthy.
Speaking of the Jamaican runner, he also featured as the protagonist in a Gatorade mobile game, which required players to complete an obstacle course while avoiding Caribbean Pirates, cannon fire, explosions and—wait for it—water.
The Clax can’t even criticise this move. It’s impressive. Well done Pepsi. You’ve literally encouraged kids to actively avoid water (Nestle’s chief executive is famous for saying water is not a human right).
Now, this isn’t to say that everything you do is this disturbing. Your sporting development programmes do provide freshly laid astro turf and basketball courts for the children of the world to play on. But releasing videos, in which you claim credit for the smiles on the kids’ faces is certainly taking a step back. It’s kind of like lending money to a struggling family and then capturing video footage of the mum buying groceries.
Now brands, look, I understand that you’re trying to assuage some of the guilt you’ve accumulated over the years from making us unhealthier—but can’t you just quietly go confess your wrongs behind closed doors rather than hypocritically sitting in attendance at sporting events?
You’re not fooling anyone.
In the spirit of past heretics, ranters and agitators, our resident angry outsider Claxton tells you what’s getting his goat about this industry.
Hawley: “A truly moving spot that manages to connect the gulf between the world we take for granted now, and the world protected by our countrymen all those years ago. Quite something that this single spot can achieve such an emotive response from 30 seconds of creative excellence. Great reveal.” Hawley: “Lovely story telling demonstrating what makes driving through New Zealand great, and BP’s role in making that happen. Arguably the story could be applied to any fuel company though …” Humphries: “By cleverly using all the onlookers that gather around a bit of filming they’ve created something very powerful and moving.” McKee: “On the whole New Zealand should be proud of the way it honoured the Anzac Centenary. This was a great example of bringing to life the reality of the situation without glamour or fanfare whilst getting their message across at the same time.” Humphries: “Nicely told story, well castwith the product/service at its core. But how they must have cussed when Vodafone pulled its tale of a lost piglet out of a very similar shaped hat.” McKee: “Apart from it being slightly unfortunate timing with all these lost animals being found at the same time, I really like it. It’s beautifully shot and heart-warming and I am certainly looking forward to more BP stories.”
Agency: Tenfold Creative Client: Marley New Zealand Brand/product: Premium Spouting and Downpipes Media: TV, digital, print Campaign Description: Continuing the ‘Where style meets durability’ proposition established in the previous TVC, this advert for Marley Stratus Design Series’ new colours, Ironsand and Grey Friars, retains a connection between the designer spouting and downpipe system and the New Zealand weather it protects your home from.
I’m the youngest of five girls and I grew up in Hamilton. My first part-time job at high school was in the delicatessen at the Woolworths supermarket in Hamilton East. I didn’t ever intend to work in retail. I actually planned to be an archaeologist, and realised quite early on that there was no money in archaeology. And in a country with a history as short as that of New Zealand, maybe that wasn’t the best long-term career option. So, I started law school, realised that wasn’t an option for me, and I did an arts degree. During university I had part-time roles in food retail in Wellington, and didn’t realise at the time that I would end up doing what I’m doing now—which, in my opinion, is the perfect job. For a data-driven marketer to end up as the general manager of marketing for the largest supermarket brand in the country is unusual, because we operate in the world of mass communications—but, at my heart, I’m a direct marketer. So sometimes people ask me how those things reconcile, and in my mind they reconcile in an amazing challenge: how do I take a very mass conversation and drive some of the practices and techniques that you learn as a direct marketer? And how do you get those things to co-exist? Whether I’ve succeeded in doing that, I don’t know. I certainly have a lot to do, but if I think of some of the things I’m most proud of it would be taking the One Card programme and turning it into some pretty smart communications direct to consumers. The most powerful asset I have in my arsenal is the data of people shopping in their local stores. It lets us have those relevant conversations. Through things like the MyCountdown email and web platform … we are able to have more personalised and tailored conversations. As marketers, we should never feel comfortable or complacent. Frankly, if we do, then we’re doing our customers a disservice, because they are continually moving and evolving. The way people are consuming media is evolving and changing and as marketers we should never be comfortable that we’ve got it right … I am perpetually dissatisfied. If you ask my team, they’ll tell you that I’m always wanting to do the next thing. I’m proud of what we’ve done, but there’s so much that’s possible. But in an environment like retail, you have to be constructively dissatisfied. It’s not about things not being good enough. And if I think about my colleagues in buying, operations and logistics, it’s clear that the executive team at Countdown is never going to accept that what we’ve done is enough. It’s never finished. And although it sounds negative, there’s actually a positive in that it means there’s always more that we can do for our customers and there’s always a better way for us to deliver a service and market … And that drives me. Countdown is an incredibly huge and complicated beast that serves 174 communities made up of 2.6 million customers a week. I know it sounds like a cliché, but my job is very simple: I have to tell stories and sell baked beans and bananas. It’s nothing more complicated than that. Where we hit the nail on the head with the animal card promotion was that it had an educational component. Now, I’m not going to sit here and say that we will only ever do programmes that have an education element to them, but it’s clear that when you get the combination of education, collectability and scarcity, then you get the kids, their parents and the schools engaged. This was seen an opportunity for a learning experience. It wasn’t just a supermarket promotion. We are having a lot more conversations among the leadership team about being more local … So in that regard we have things like the Countdown Kids’ Hospital Appeal, which with the help of our customers raised $1.3 million last year. We also have our relationship with the Salvation Army, through which we support Red Shield and Christmas appeals and also our food rescue programme … We’ve been doing that kind of stuff for quite some time. We haven’t talked very much about it. We’ve been relatively quiet about the ‘for good’ work that we do—and that’s an acceptable position. However, in my view as a marketer I see it as a missed opportunity. We should talk about the good stuff that we do. The reality is that brands do things to be good corporate citizens, but that is not the only reason why we operate in that space. We need to be pragmatic. We do things to benefit our brand equity as well as being a good corporate citizen. That was unfortunate. I don’t know very much about how things transpired there, but what I will say is that we took a sound and valid position around Anzac Day. It was about supporting the RSA, and it’s purely and simply that. We were a vehicle for our customers to express how they feel about Anzac Day and the role that it plays in the New Zealand psyche.
always been intended as a facilitator of this, seeking to provide a platform from which the right behaviours can be recognised and more powerful emotional connections can be forged.
All promise, no delivery?
While loyalty programmes might intuitively feel like a good idea, and while the US alone might invest more than the GDP of half the world’s countries in utilising them, the fascinating truth is that there is very little evidence at all to suggest they actually work in practice.
Indeed, in the vast majority of cases, the real world evidence suggests that companies that focus heavily on developing loyalty programmes end up worse off.
A 2013 McKinsey study of 55 publicly traded companies across North America and Europe showed that those with more prominent loyalty programmes grew at the same rate, or slightly slower, over the past ten years than those with no or low investment in loyalty programmes. And far more significantly, those with prominent loyalty programmes had earnings margins that were around ten percent lower than comparable companies within their sectors with less significant programmes.
Put simply, the evidence suggests that loyalty programmes are, for most businesses, simply adding costs with little tangible long-term benefit.
Similar results are seen when the lens is flipped from business performance to look at how consumer behaviour is actually impacted over time by loyalty programmes. A Deloitte review of the hotel market concluded that at best the loyalty programmes in place had little or no impact on purchase decisions, and at worst were actually driving undesirable switching behaviours. A review of the Fly Buys programme in Australia by marketing academic Byron Sharp, author of How Brands Grow, showed a similar lack of benefit for member companies, failing to identify any across-the-board advantages for them in terms of repeat loyalty behaviours beyond the “disappointingly small”.
But perhaps most compelling in this space is a 20-year longitudinal study of consumer purchasing behaviour, conducted by marketing and communication guru Andrew Ehrenberg. The study, which covered a huge range of FMCG and services categories in Europe, Japan and the US, showed that the truly ‘loyal’ behaviour (i.e. buying only one brand) that programmes desire from us simply didn’t exist in any category beyond a small niche of light buyers, typically less than ten percent of customers. In all categories, people tended to display a polygamous loyalty to two or three brands, and that the chance of using these brands was more or less directly correlated to their market share. And over this 20-year period, there exists no evidence that loyalty programmes had any long-term impact on the share of purchasing a brand achieved. The only way brands in the study achieved a greater share of loyal buyers was by improving their marketing mix and growing.
Put simply, the study suggests that incentives alone are not enough to change behaviour. To get loyalty improvements, you had to get better at what you offered the market and grow.
programme, but every other that follows. Indeed, it forms the basis for the whole idea of relationship marketing and dominates the discourse for the data-driven marketing movement. The accepted wisdom here, as outlined in a wide-ranging review of the space conducted by the Sloane business school at MIT, is that a loyal customer is more profitable to a firm. They cost less to service, they are less price sensitive, spend more and provide positive word of mouth to the market. Further, there is an assumption that there are customers who want an involved relationship with the brands they buy; they seek to establish loyal behaviours and can be encouraged up a ‘loyalty ladder’ to exclusive usage.
All of this looks pretty sensible on the surface. The trouble is, however, that many of these assumptions about the value of loyalty and how it can be obtained don’t bear out when we look at how people actually behave. And this is where things start to go wrong for a lot of loyalty programmes.
First let’s revisit the Ehrenberg study of buyer behaviour. What this establishes from the outset is that there is no ‘hard core’ of truly 100 percent loyal customers in most categories, beyond a small group of very light users. And inherent in this is a challenge to the idea that customers want to be loyal to a single brand, or even that this behaviour can be incentivised. And there are very good reasons for this. We don’t want to only eat McDonald’s when we need fast food, Speight’s is better suited for the rugby you’re about to watch than the Monteith’s you usually quaff in bars and Air New Zealand isn’t flying to Melbourne at the best time for you on this occasion. Something we see in our own work with clients time and time again is that people like to operate small repertoires of acceptable brands in pretty much all categories, because this makes decision-making easy. If a situation arises calling for a purchase, one from the repertoire will fit and you don’t have to apply a lot of effort. Single brand repertoires are simply not desirable in most instances, because they make our lives harder. And no amount of incentivisation is likely to overcome this.
What the study also establishes, and something that is reinforced in Byron Sharp’s Fly Buys study, is that even increasing frequency of purchase through incentivisation is a fraught assumption. Over the 20-year period of the study there was no real evidence that loyalty programmes changed a firm’s share of repeat purchase beyond what could be expected for their market size. What this again suggests is that changing behaviour using rewards and incentives is difficult. And again, there are some very good reasons for this. We establish our usage of brands in categories based on our belief in their ability to meet our specific needs.
A customer’s relative use of Air New Zealand vs. Jetstar is all about their perceptions of the experience that will be delivered, the cost, the timetable, destinations, etc. In essence, the brand’s marketing mix formulation. What follows, therefore, is that it will always be difficult for rewards alone to disrupt this pattern, because they are asking us to put aside our beliefs around brand suitability for the purchase occasion in favour of an incentive. For that value equation to work, the incentive will likely need to be far more significant than what can be manufactured by most loyalty schemes, especially over a longer term.
So, the big conclusion we can draw at this point, is that most loyalty programmes fail to achieve results for business because they are based on flawed principles regarding how customers want to act. They are, by and large, trying to incentivise changes that people don’t want to make. And as such, any loyalty programme that is based solely on providing rewards to change behaviour will fail.
It’s probably also worth pointing out that some of the assumptions around the value of loyal customers are also based on very little sound fact. There is no real evidence that very loyal customers pass on any better feedback to the market than ‘normal’ happy-but-promiscuous customers; there is little evidence that highly loyal customers are any less expensive to service than normal long-term repeat-but-promiscuous customers; and no clear research to prove they will be less price sensitive either. Significant reviews of the space conducted by leading academics and management consultancies find consistency in these assumptions, but find little to actually support these ideas.
However, while there are strong clues to why loyalty programmes fail in the core assumptions that underpin the movement, there are also principles that do hold true in this space, and which point us towards why some programmes prosper.
And that’s the idea of customers wanting a relationship with brands and the value of emotional connection.
Success is scarce
What is evident when successful loyalty programmes are examined against those that fail to create change is that they create stronger emotional bonds between the customer and the brand. Their transaction with the customer is not merely a reward for a behaviour, but also recognition for behaviour. The earlier mentioned
How many ‘loyalty schemes’ do you see nowadays where you’re given a generic discount voucher in exchange for your email contact details? Did this exchange actually change your feelings or behaviour with that business? For many marketers today, the loyalty programme remains a trusted tool to encourage customer behavioural change. Yet the rise of email marketing and new technologies, leveraged in an untargeted manner, increasingly obscure the core value that loyalty programmes can offer to brands. Businesses today can capture huge amounts of data on their customers and have more channels than ever before at their disposal to reach them. All too often, however, permission to use this data and send blanket mass messages to consumers is assumed rather than earned. Marketers adopting this approach today are missing out on gaining a deeper understanding of their customers, making it more difficult to deliver a better return on investment on overall marketing spend. Beyond this, they’re missing the opportunity to build a stronger, longer lasting relationship with their consumers through this bland, untargeted approach.
Recent multi-market consumer research by the Aimia Institute has found a growth in ‘deletist consumers’. These are shoppers that in a bid to cope with the deluge of mass, untargeted digital messaging from today’s brands simply hit the delete button. This research found that irrelevant blast messaging is doing more damage to customer relationships over time than you might realise. These coping mechanisms mean that 71 percent of consumers will now unfollow brands on social media, 73 percent will close accounts and 60 percent will delete apps thanks to poorly targeted brand communications.
hen social media really started to hit the scene in a big way in the mid-2000s, predictions of its coming dominance were rife. The speculation began as far back as 2005, with media bloggers at Slate wondering if the Internet would herald the death of television, presciently citing p2p-sharing and time-shifted on-demand viewing as the harbingers of that (predicted) doom. But with the benefit of some 20/20 hindsight in 2015, perhaps the cart was being put before the horse a little.
Although social media and interactive advertising goes from strength to strength, it hasn’t been quite the TV-killer pundits assumed. Instead, we find ourselves in a world where social media and traditional media each have their parts to play. “Television advertising may have dropped in relevance but it still holds a lot of credibility in people’s minds,” says Tom Reidy, social media agency Catalyst90’s CEO. “The real ‘silver bullet’ for marketers is in integration, stitching all these different platforms together.”
Admittedly, this is not the sort of thing people are used to hearing social media agency heads say. But Reidy’s view is that social media agencies, with their focus on nimble technology and production, are important strategy partners during early stages of campaign planning with more traditional agencies, ensuring the right content for the right platform for the right audience is produced, and backed up by solid customer service and retention. In the early days of social media, brands flocked to it with the idea that it could be treated as “just another channel,” says Reidy. They brought an advertising mindset that was all about selling a product, but left out the service component – whether or not the product could live up to the hype. “That’s where agencies got it wrong because the focus was on the advertising of the product and not the follow up, not the retention,” he says. Consumers forced brands into two-way conversations, taking to social media not just to amplify approved marketing messages, but their own likes and gripes. And a brand’s response – or lack thereof – has the power to earn or lose massive amounts of public goodwill. “Like it or not, awareness quickly becomes reputation and if you don’t have your reputation locked down on social media, and if you don’t have a plan to retain your audience, your campaigns will merely amplify your brand’s failings,” Reidy says. Despite the enhancements that social media and other technology have brought to the marketing discipline, the importance of knowing who your audience is–and where they are–hasn’t changed. Answering that question is where any good strategy starts, and a strategy is where any good integrated campaign starts. Different platforms call for different approaches and an understanding of how people interact with that content, whether it’s a TVC, a YouTube pre-roll, or a seven-second Vine video. Simply cutting shorter or longer versions of the same content isn’t going to work. Social media and traditional media can work well together, and second-screening behaviour means users are primed by TVCs to engage more deeply online. But this extended engagement needs to be planned for at the outset, not as an afterthought. “A great strategy will create the foundation for execution across all channels, and content can then be adapted for success in each specific
As Jeff Malone, the man who has recently arrived in New Zealand to run the local outpost of #ogilvychange, says “there is no such thing as neutral choice architecture.” What the critics also forget, he says, is that no matter how well you understand human behaviour, you can’t make people do something they don’t want to do. If someone doesn’t like bananas, it’s unlikely you will be able to convince them to eat a banana. But as Sommer Kapitan, lecturer (assistant professor) in marketing at AUT, says, you can try to push people who may be inclined to eat a banana in a certain direction by understanding how information is processed by the brain. And, if the smell of baking bread being pumped out of the Subway store works for one in ten people, then the importance of the subconscious—or as she calls it, sensory marketing—becomes an enticing prospect. Sutherland believes the advertising industry has been deceiving—and under-estimating—itself for decades in this regard: “Unnerved by books such as The Hidden Persuaders, by attacks on motivational research and by an experimental study of subliminal advertising effects in cinemas (which it later transpired was bogus) they disingenuously played a get-out-of-jail-free card by pretending that advertising worked exclusively within the realm of conscious awareness. This act of denial had some terrible side-effects. It created a strange culture within marketing where everyone pretended that all persuasion occurred through reasoned argument alone. As a result of this convenient fiction, important aspects of human behaviour were effectively offlimits for about fifty years. The denial of subliminal effects also made marketing/psychology much less influential than it deserved to be.”
For him, “our perception of, and reaction to, reality is subjective. How you feel about products, or even about your life, is at least as important, and probably much more important, than the product or your life’s objective characteristics”. FCB’s planning director David Thomason believes the best advertising is proven to be over the long term. And while the bean counters might not agree with the view that “there is no sensible distinction to be made between value created in a factory and value created in an advertising agency,” he is in Sutherland’s camp and thinks that advertising is part of the product.
“It probably sounds like an ad agency trying to defend itself, but you don’t just buy the physical item. You buy what’s attached to it and it genuinely adds enjoyment to it and neuroscience proves that’s correct. If it’s got a Coke label on, you’re actually getting more excited, it’s not just the chemical interaction on your taste buds.”
Lewis Road Creamery’s chocolate milk was a great product, but the madness seemed to be less about the taste and more about the enjoyment derived from finding it and sharing that experience. And Kapitan agrees. She points to a study that gave women empty Victoria’s Secret bags to carry around a mall and just doing that made them feel more elegant. Another study had MBA students use a Harvard pen and it made them feel more confident and powerful. Thomason says it even applies to the type of undies we’re wearing, even though most people, thankfully, aren’t going to see them.
“It’s the idea that we can subtly get in there and change attitudes,” Kapitan says.
Or, as ICG executive director Mike Hutcheson likes to say, you’re drinking what you’re thinking, something proven very literally by a study that saw more German wine than French wine purchased when German music was being played in the store. Of course, when asked why they chose the German wine, none of the customers mentioned the music as the reason. Thomason believes a lot of the academic stuff is just catching up to what those working in the persuasive arts intuitively knew. Creatives have long worked on the basis that something likeable and emotional will be more effective, something that was brought into sharper focus during the creative revolution in the 1960s; Kapitan says advertisers have always looked at what attracts peoples’ attention best, whether it’s the colour used, the size of the imagery or the fluency of the reading; and the main goal of branding is to create a short-cut in the consumer’s mind (Ries and Trout’s concept of positioning). So Thomason doesn’t believe a deeper understanding of cognition is completely changing the sector, but it is a form of scientific validation for the industry’s longheld beliefs and in many cases, the principles of behavioural science are being used to make creative work even more effective.
In an age where efficiency often seems to trump imagination and where accountability is demanded, Malone believes the language of marketing often comes across as bullshit to everyone else in the c-suite. So he thinks BE could also help solve what he feels is marketing’s PR problem.
“BE doesn’t just open up new opportunities. It gives marketers a better way to sell them into their organisations.”
Thomason, who is part of FCB’s global Decisionmaking Institute, says the New Zealand office’s early focus on behaviour change (which is now being rolled out around the world) initially came about as a result of all the work it was doing with government clients. He says social marketing has recently gone through something of a revolution and it shifted from ‘don’t do this because bad things will happen’, to ‘here’s a funny ad and something you can do to get a positive outcome’. So is this change in approach based on science? According to one of the world’s leading authorities on positive vs. negative incentivising in social marketing, ‘we don’t know’.”
Thomason says it’s all about culture, about what’s trendy at the time, although he believes government has learned from commercial marketing, where the product or service being advertised always provides an answer to a problem.
“We shifted to positive role modelling with ALAC. We did a big study on how people responded to that plus we were reading all about BE stuff and it’s bloody obvious when you think about it. You can’t tell people what not to do. People run from problems. You have to offer a solution.” In the commercial realm, he points to its work on Mitre 10’s ‘Easy As’ as one of the best examples of using BE techniques to help customers and drive sales. The company’s core purpose is about ‘the unique satisfaction of a job well done’, so he says it uses the herding principle (DIY is in our DNA, so if you don’t have it you’re not part of the herd), the identity principle with the two guys standing side by side in the ad (‘you don’t want to be this guy’) and chunking, or splitting tasks into manageable bites, as seen in the practical videos. »
Slow says, the two-system set-up is also how our brains work.
“The biggest effects of advertising are long-term,” says Thomason. “It sounds like a weak defence to say ‘if you didn’t do that campaign your sales would’ve gone down’, but if you don’t do it, ten years later that will be the case. Being known is important as well. In some debates about advertising effectiveness they say there are only two things that matter 1) you get seen by the audience and 2) they know who it was for.”
And all the rest, such as the creative idea, emphasises those two things to try and ensure the brand is the first one to be associated with a category, or at least a sub-category.
Malone says Virgin Atlantic realised brand building wasn’t all about comms when instead of getting rid of the salt and pepper shakers that were regularly stolen by business class passengers, it added the words ‘pinched from Virgin Atlantic’ to the bottom (it also made ice cubes in the shape of its founder Richard Branson’s head). He says it realised it’s often the small things that matter most and that people remember. And this aligns with one of Sutherland’s famous suggestions: instead of taking the rational approach and spending billions to shave a few minutes off a train journey, it would be a better (and far cheaper) idea to hire supermodels to serve you champagne, thereby enhancing the experience and changing the way you think about travelling.
“It’s natural for people to think that big problems require a big solution,” says Malone. “It’s called the proportionality bias, but that’s not always the case.”
Thomason says digital brands are probably the masters of using BE techniques, but many of the small changes that often create results are just not very exciting. Google’s really simple home page is a good example. And Facebook has also created big changes from small tweaks on its platform (last year it was lambasted for its role in an experiment it conducted on users without consent that showed it was able to modify users’ emotions through changes to its algorithm).
“It’s shifting from communications to engineering experiences, but it’s not novelty that matters in that case, it’s ease.”
Malone believes government institutions are also leading the way in the area of BE because they often don’t have large media budgets. For them, it’s often about efficiency, which is the core of strategy and planning. And they also have to be accountable. Following the principles of BE allows governments and businesses to experiment in small areas, rather than spend money on big campaigns or conduct nationwide research that is most likely based on claimed behaviour, rather than actual behaviour. We can’t explain our unconscious decision-making, which means there’s little point asking a rational, logical question like ‘does enjoying this ad make you more likely to pay more for the product in the future?’ Sometimes the most efficient solution can be the simplest. As an example, Malone points to a highway in Chicago that had some dangerous curves and where speed was an issue. Rational messaging about the danger didn’t help. But painting some narrowing lines on the road to trick drivers into thinking they were going too fast did. It was basically a brain hack and Thomason says a similar principle applies to shared pedestrian zones where different road surfaces are proven to make you slow down.
These are evolutionary responses and our behaviour is affected when we sense a change in our environment, he says. Kapitan points to a study by one of her colleagues who pumped the subtle scent of strawberry through a lecture theatre. When students were asked to take a lolly at the end, all the red lollies were taken. When the smell wasn’t present, red and green lollies were taken equally.
“The idea is that you can change really big important things by making these little tweaks and they use the same examples over and over again,” Thomason says, such as the experiment in a hotel room to get guests to re-use their towels. Focusing on abstract concepts like ‘saving the environment’ or ‘this hotel does three tonnes of washing every day’ is far less effective at changing people’s behaviour than showing them that the majority of people who stayed in the hotel reused their towels.
Another oft-used example is the major e-commerce site that replaced the “register” button with a “continue” button and added a message saying that registration wasn’t required to checkout. As the case study showed, this simple change increased sales by 45 percent—$15 million in the first month, and $300 million in the first year.
It’s unclear if that site was selling diamonds. But, given the industry’s understanding of human behaviour, it wouldn’t be entirely surprising.
Turns out that designers, tasked as they are with the consideration of actual end users’ experiences of a product or service, are well served by their tools and processes to solve a whole lot of problems beyond simple packaging and graphics. In fact, their remit has widened so far that their skills are now sought after as a way to engineer innovation within organisations.
Thanks to improvements in digital technology and widening acceptance of the ‘design thinking’ principles of rapid iteration and customer centricity, right-brained creatives are increasingly staking claims in traditional realms of the left-brained. Businesses in need of culture change are choosing designers in favour of MBAs, and governments are supporting design initiatives (as has our own through Better by Design) to encourage innovation and growth. Meanwhile, corporates the world over are creating chief design or experience officer roles to champion and prioritise design internally.
Why? Simon Wedde, group account director at Dow Design thinks it’s that designers are interested in reflecting the reality of a product or service and the way those are used by actual users, which leads to pragmatic solutions. On the other hand, he says consultants can be too far removed from reality. “You can overcomplicate it and get lost in the theory.”
The important thing, whatever happens and whoever is driving the process, is keeping the customer at the heart of the experience. “Great design has always been based on the consumers’ experience and usage,” says Wedde. “You can label it user experience and you can call it customercentric, but it’s always been that way.”
Design for the bottom line
Does good design impact the bottom line? According to Apple, the world’s most profitable company, absolutely.
To be slightly less blithe: yes, but it takes some work—and possibly some convincing.
“The challenge has been, as with design itself, that you need to demonstrate a usercentred approach isn’t slower, it’s faster. It’s not more expensive, it actually adds value,” says Che Tamahori, managing director at Digital Arts Network (DAN), where he’s headed up projects for TVNZ and Tourism New Zealand, among others.
Taking a real user-centric design focus takes time and that’s why agencies like DAN prefer to build long-term relationships with clients they know are committed to design. It’s also seen agencies being brought in to discussions with clients and advertising agencies much earlier in the process than in the past.
Fortunately, the outcomes of good design are measurable. Especially in digital design, where optimisation tools speed of the internet allows changes to be made and tested almost immediately. “In near real time you can tell whether a change to something has added value, or whether you’ve gone backwards,” says Tamahori. That means design is less subjective now. “You can know by the end of the week whether or not [a design change] had the impact you were seeking. It’s an objective measure—and that’s quite confronting for some designers. It’s exciting because you can prove the value, it’s scary for some people because they have to let go of the idea
“design intensive” firms outperform their presumably less design-intense peers by 200 percent in the stock market—through bull and bear performance. In qualitative interviews conducted with business leaders, reported benefits weren’t limited to improved sales and market shares, but also included non-financial benefits like higher brand recognition and enhanced customer satisfaction. “Importantly,” the Council’s report states, “a correlation was made: the more strategic the business’s use of design, the greater the benefit.”
Still, New Zealand is a nation of SMEs. Is it fair to expect that smaller, established businesses shift gears so completely if they’re not already familiar with design? Well according to Moon, it’s critical. “When I started [Icebreaker], design was an optional strategy. Now it’s mission critical,” he says.
Icebreaker founder Jeremy Moon likely never heard Kevin McCloud’s exhortation to cut your costs and spend the savings on better design—but it’s a message he probably agrees with. Moon took half of the $200,000 seed capital he raised and put that into product and brand design. “Some people said ‘oh god, that’s risky’, but for me the big risk was not having a strong, professional story because I knew we would fail if that didn’t happen,” he says. “So for me it was actually a risk reduction strategy.”
Right from the start Moon knew he had a good product, but no one at the time wanted wool. So plunging the money into setting up a believable, professional image was
central to gaining the trust of customers and retailers. At the outset, Moon says he didn’t know anything about design so he teamed with someone who did—Brian Richards— and together they interviewed several design agencies to see who had the best approach to bringing the brand’s story to life, a deal that ended up going to Designworks.
It wasn’t until the brand story was in place that Moon began designing the first product. “Brand is identity, it’s a reflection of why the company exists and what the company stands for. The product is the physical expression of the brand,” he says. That’s a concept Moon says a lot of the businesses he comes into contact with through his association with Better by Design (he’s the current chairman to its advisory board) don’t understand. “They think they’re in business to make products. They’re actually in business to make an impact on people’s lives and you need story as a way of bringing that narrative alive and making it relevant for people. The product is then the physical expression of the promise that comes from that story,” he says.
The strategy paid off for Icebreaker and the initial $200,000 of seed capital has turned into about $200 million of sales across 45 countries and 500 staff, with more than 80 percent of sales from the Northern Hemisphere.
“If you don’t have a differentiated product or service you compete on price, and if you compete solely on price then unless you’re the cheapest, you die.”
from a business perspective and McCort from a creative perspective, which the team believe is another contributor to its success.
Dow’s lead of the agency is particularly impressive given she is one of the few in her particular design field heading a successful company in a male-dominated environment.
“I am very aware of that and that’s something I’m really proud of,” she says. “We’ve been going a long time, we’ve got a really solid reputation. Having said that it is nice to have a balance with someone like Simon [Wedde] … it is good to have that balance of the male and female genders and everyone offers something different.”
Design is also an inherent skill, she says, so it can’t be said that females are better than males or vice versa but the female eye can in some situations offer something different.
“You’re either a great design thinker or you’re not and our male designers are just as good as our females,” she says. “But I do feel that the female design eye can slightly have more empathy in some design spaces than perhaps the males.”
Dow also takes its craft seriously, resulting in the exquisite execution of its designs, which Wedde says is due to being staffed by very senior and experienced creative thinkers and production staff “…and we are also extremely fussy and critical. This is Donna’s experience and great eye and also Annie’s philosophy that she has instilled in Dow that ‘good enough is not good enough’, it is reflected in her own personal taste and style,” he says.
Annie Dow says it takes courage to do things differently and stand out from the crowd. “We pride ourselves on that. We’re bold, and we challenge category norms on many occasions, but only when we need to. Not just for the sake of it.”
She says Dow keeps its eye on the prize, designing with purpose and with the simple knowledge that great design solutions sell “And that is the most satisfying, our clients’ sales results. Design is not just about looking good, it is about being effective, truly powerful and potent in the market”.
And after a prosperous two decades Dow Design is showing no signs of slowing down yet, with the team saying it looks forward to another 21 years of success with its clients.
on account of need to revamp the research methodology used. At first, MediaWorks claimed that it was an agreement across the industry, but then NZME responded by saying that it had always wanted to have the survey.
“Clients have told us they want more data, not less data,” said NZME commercial director Sandra King at the time.
So to give clients and agencies what they supposedly want, NZME financed its own industry-wide survey independently—a move that was quickly denounced by MediaWorks for giving its competitor an unfair advantage. Several articles in the media painted a picture that MediaWorks and NZME were struggling to get along and that they weren’t interested in working together at all. And these sentiments were only further concretised through speculation that The Radio Bureau (TRB) was set to be disbanded.
The rumours surrounding the dissolution of TRB served as something as a turning point for the uneasy relationship between NZME and MediaWorks, and was followed by the pair sending out a joint statement to quash the industry murmurings.
At the time, statements like “both companies are committed to TRB” reeked of PR insincerity, but NZME Radio managing director Dean Buchanan and MediaWorks’ Palmer have maintained this cooperative approach ever since (something evidenced by the fact that neither network celebrated their ratings wins following the release of the NZME-financed survey).
As Buchanan and Palmer took their seats at the Radio Rewired event, it quickly became evident that the platform was going to be used to consolidate the message that the pair were collaborating.
‘As Dean says’, ‘as Wendy says’ and ‘we’re 100 percent committed to this’ were common phrases as the pair shared thoughts on where the industry was going. And while the tradition of competitive feistiness in the radio industry still made these statements sound forced at times, there did seem to be a common understanding that collaboration was necessary to ensure the longevity of radio.
A similar approach has been employed in the magazine industry. Several years ago, off the back of years of competitive in-fighting between the nation’s major publishers, the Magazine Publishers Association recommended that its members work together and, instead of trying to revenue from each other, look to gain a cut of the ad spend pie from other channels. The television industry also appears to be putting aside some competitive tension and working together to promote the medium. Pandora, Spotify and the recently arrived Rdio all occupy a space that is becoming increasingly threatening to traditional radio. And the commercial networks now regularly vie against these online players not only to attract audience numbers but also for a cut of ad revenue.
Faced with the inflating popularity of these international players, NZME and MediaWorks have been trumpeting the influence of their local talent.
“It’s about localism in the global economy,” says Buchanan. “The power of the personality will grow in the years to come. That’s what differentiates our medium from the internet providers.”
But the absence of personalities on Pandora doesn’t concern Melanie Reece, the company’s commercial director in New Zealand.
“We do one thing and we do it really well,” Reece says. “You don’t get to have 300 million users worldwide unless you have something very special.”
Reece describes the internet as a democratic space and that consumers will ultimately determine what they want to listen to. And while this might be true for the thousands of office denizens listening to Pandora while staring at spreadsheets, in-car listening—which accounts for