Marketing Intelligence by Iain Johnston

London is famous for many things. The city is a cosmopolitan mix of people and is world famous for the Houses of Parliament, Buckingham Palace, the London Eye, the River Thames, and red London buses. And black taxi cabs.

While I understand the merits and environmental efficiency of public transport, I must declare a prejudice: I get too hot on the Underground in the summer. So I spend a fair amount of time travelling between our various London offices sat in the back of black cabs. Quite rightly, our wonderful London cabbies are world renowned for their knowledge, their conversation, their love of cyclists and their shy and retiring nature.

These cabs are on the outside in the same form as they were 40 years ago, but under the surface, the technology has changed dramatically. In addition to the intercom which allows the driver to listen in to your innermost thoughts and conversations better than ever, and the mirror in an impossible position over your left shoulder, some also have this so called “in taxi entertainment system”. The barely visible screen down by the floor relays a loud and endless reel of adverts interspersed with some poker tournament footage taken from late night channel 456. The controls are on the side console (under the impractical mirror) and make my sky remote control look simple. Clearly they are designed to confuse (colours and symbols) sufficiently so that people can’t turn off the sound, thereby risking missing out on the important messages being delivered by the system.

Full marks for the idea of sprucing up the journey and attempting to grab some commercial gain from otherwise dead time. Zero points for actually delivering something that the customer really wants and values.

So, my wife and I were on holiday in New York last week.

New York is of course famous for lots of things, including the ubiquitous yellow cab. Locals will of course tell you that a point of differentiation between yellow cabs and the London black cab, is that New York cabbies are universally from Iran or the Phillipines, are always on their cellphone, have very little local knowledge, and will never stop for you if it’s raining or you are late.

But the thing that really impressed me last week was that every single yellow cab I entered had an interactive touch screen display that made our feeble London attempt at in-cab entertainment look pathetic.

EVERY cab had a system that:

1.                  is easy to use, intuitive interface, touch screen, and specifically easy to mute

2.                  has moving gps-based map display of the local area (updated constantly) so you can see where you are, and if you so wish the route to your destination.

3.                 allows  zoom in/out, places of interest.

4.                  provides a side channel (configurable) with a choice of entertainment, local tourist information and weather.

5.         ok, there were ads too.

It was almost as if the designer had actually researched with taxi users what they would appreciate, and come up with something that met their needs.

Although it seemed last week like we walked the whole city, we did catch quite a few cab rides. But far from resenting the mini-screen ads on our various trips, they were delivered as part of an interesting package. I guess this has been the challenge of media channel owners for ever.

It think this is a theme I will return to……

My son is about to start his GCSEs.

[Just let me pause at that point while all over 40s lament the demise of O' Levels, and how everyone these days get A-star GCSEs for just turning up to school.]

He’s taking maths, like everyone else, because it is compulsory. Like long hair, l33t speak and  not tidying your teenage bedroom.

Over the school holidays in between the joys of summer camp, foreign travel and the huge global community that is his facebook friends list, he has been working through some maths papers, the better to prepare for next term.

[I'll pause again to duck the torrent of teenage angst at blowing his cred with his mates for doing school work when there are perfectly good music tracks to rip to CD, raves to plan, and parent-avoiding parties to sort out]

I had a look at his Maths papers. Now I did Maths A’ Level (and they were much more difficult in my day……), but I have to confess, that even at 14, he is going beyond what I can remember or understand.

Sticking with simpler stuff, there is a mathematical formula that helps understand the importance of every element of the planning, producing and implementing a marketing campaign.

Think of the success of a particular marketing campaign as a function of many variables: product quality, market growth, customer spending patterns, stock availability, competitive action, marketing noise/distractions, service quality…..before we even get to the creative quality of the ad or the focus and clarity of the message. I have written many times about the importance of actually being able to deliver the product or service you are promoting.

I guess my maths point is that the overall success of the campaign is a the result of a multiplicative function. If all of the variables are good, the overall result will be good.

But if just one of the variables is weak, or indeed zero, the end result will still be zero.

Let me spell out what I mean. Think of measuring each variable (e.g award winning creative treatment, or stock availability) on a scale from 0% to 100% where the low end of the scale is zero e.g no product availability (you can’t find it anywhere), and 100% means it is ubiquitous (you can’t even turn around instore or online without falling over it).

Try it:

100% x 100% x 100% x 100% x 100% x 100%……[you get the idea]…..x 100%  = 100%

ie 100% success, the best result you could possibly get.

You get one thing wrong, (e.g. your product is out of stock, your service capacity is down because of server problems or staff shortages), then substitute a 0% for one of the 100%s, and the answer is 0%.

100% x 100% x 100% x   0%   x 100% x 100% ……………….. x 100%  = 0%

ie 0% success. Zero. Nil. Zilch.

So any one element of the marketing mix, any facet of the customer purchase decision, and single piece of the overall jigsaw can ruin your result, no matter how brilliantly you sorted everything else.

It can be the unglamourous stuff that cocks it up for us too. Great product, brilliant strategy, beautiful messaging, spot-on segmentation and audience preparation, then terrible production means the ad is out of focus on the page. Or great concept for a market share boost, superb negotiation with retailers re gondola-end placing, fantastic new product extension, let down by a point of sale technical fault meaning the product falls over on shelf and looks crap.

So forget the detail being boring, it’s really exciting when these guys look after the detail that often gets overlooked, and these bright young things know how to make it really work in the last 10 seconds before a customer decides what to buy.

Last year I wrote in this column about how your own staff can determine whether your multi-million pound investment in a marketing communications campaign succeeds or fails.

I wrote about how the brilliantly trained Virgin Trains staff can live and breathe their brand and keep passengers smiling, even when the rail network is in chaos, the wrong type of rain is falling, and a badger is on the line.

And as my friends at The Team will tell you, the best service brands are rooted not just in some head of marketing’s ideas for glory, they need to be built on the strongest possible foundations of staff involvement, engagement and everyday action.

More recently, just before my recent holiday (about which more later), creativematch carried my thoughts on the theme.

It is nearly always logical in early stages of planning a campaign with clients that we discuss how a particular communication or message fits in the wider context of their plans and the market. We would always want to address how the campaign will be trained in with staff ahead of time, so they are ready to “live and breathe” the messaging when it hits the media. There is nearly always complete agreement that we should plan appropriate levels of time, critical path and budget to ensure we get the brand right internally before heading out to our customers.

Great.

But when budget pressures arrive, it’s often the internal stuff that goes first: “oh, we’ll get people together for a brief…<whispers: did you get that email out to everyone….?>”

Or worse still, it never ceases to amaze me that the internal launch of a campaign can be an afterthought. Companies will spend millions on a particular marketing campaign, with every element finely crafted, researched and fine tuned to the n-th degree, and yet the first their own staff hear about it is when they see it in a publication, hear it on the radio, or receive it themselves through their letter box.

When times are tough, most businesses scrutinise every item of expenditure. When times get really hard, this scrutiny becomes intense, with every line of the profit and loss account forced to justify itself in terms of payback, return on investment, and direct support for revenues.

We see this in our clients’ businesses, with pressures on budgets now continuous. In many cases our clients themselves don’t know from one month to the next whether their plans for the year will get clobbered from on high in the next round of budget scrutiny. Given our philosophy at Loewy has always been to look at the impact of our work in client’s markets, and to focus on the business results they are trying to achieve, we have suffered less than most in the current climate. Indeed in a number of cases we have been able to support our clients in their own internal debates around value for money and priorities.

But, when times stay really tough for months on end, successive rounds of cost savings mean that even the largest companies have to look at all expenditure, regardless of priority. You hear the words “return on investment” nearly every day. Hold that thought.

A couple of nights ago I was fortunate enough to be invited onto a discussion panel in the City, hosted by Bird & Bird, AMR International, and Trillium. The evening was entitled “How will marketing budgets be spent in the future?”, a subject dear to my heart. There were about 40 of the great and the good from the “media” industry, ie people who owned or ran agencies, publishers, radio station owners and so on. Encouraged by the rather conducive surroundings, and an entertaining initial exchange of views, I settled into the event quite well. After all, as those who know me will confirm, I always like a good audience, and this was a good audience. Interested, energetic, engaged, rewarding as a speaker. Great.

Denzil Rankin of AMR International played questionmaster really well, inspite of the ability of some of the panel <coughs nervously> to talk a lot, about anything, especially with an audience. We discussed the delights of when an upturn in marketing spend might be expected (not in the next twelve months), whether this recession would leave lasting changes on the marketing landscape (lots, far reaching, irreversible), and which channels were the most resilient (interactive, digital, direct, point of sale) and whether there were any more of those delightful chicken goujons left in Bird & Bird’s lovely catering stocks (alas, not).

We talked a lot about Return on Investment. Maybe it was the audience. Maybe it was the speakers. Maybe it was just coincidence. But every question seemed to come back to ROI as one of the key issues in media decision making and planning the right channels for communicating. All perfectly understandable, especially given the mood of the market, and this endless scrutiny I mentioned earlier.

Then came the open questions at the end, and….

BLAM!

A question that hit me right between the eyes. A question so simple, and perceptive, that it stopped the ROI bandwagon in its tracks. Gentleman on the front row raises his hand, and says, quite simply “We’ve talked a lot about ROI, but what about the importance of Brand in all this?”

I felt such a chump. I spend my life talking to people about the importance of their brand, the power of a strong brand, and indeed how a brand properly rooted in the essence of the product or service underlying it can deliver much greater resilience, market impact and share.

Yet we’d spent the whole evening discussing marketing in a recession and not mentioned brand.

Ok so I made up for it in the networking afterwards, with due apology to those recipients of my “strong brands provide the best ROI” and “brands are a pre-requisite for survival” rants over wine and nibbles.

Let this be a lesson, to me at any rate.

Whatever the pressures, whatever the perceived topic of the day. Whatever the need to save money. Keep focused on what you know is right. Deep down there, in your marketing gut, you know your brand is everything.

And order more chicken goujons for your next event.

In marketing businesses we are used to working hard to delight and impress our clients. Many are the weekends when our people agonise over some fine tuning of the creative work, or endlessly brainstorm and challenge a proposed approach. We talk all the time about our passion for our work and our clients. Our recent Loewy staff survey revealed that 85% of our people are very proud of working in their agency. I guess many people see working in an agency as a calling rather than a job.

Maybe this explains why we are sometimes a bit slower with some of the formalities of the job than perhaps we should be. Our love for the work and its potential for our client’s business come first. When we are pitching, our excitement about the new project, and the eagerness to get up and running with a challenging new client are paramount. So perhaps sometimes we are less intense about the terms and conditions of our work than perhaps we should be. Maybe we don’t actually agree in advance the exact payment terms for our work.

Now, when I suggest it would be a novelty to get paid for our work, I wasn’t referring to the massive “over-servicing” that we inevitably do for our clients. Of course we often work many more hours than we bill, our pursuit of perfection and client delight quite rightly overcoming our need to fill in time sheets correctly and make money.

No, I was referring more to the idea that when we send an invoice for our work to a client, it would be nice to get that invoice paid within a reasonable timescale.

So what would be “reasonable”? If we have agreed terms, then I would have thought reasonable was: within those terms. Some clients tell us they have standard 90 day payment terms for specific projects. Now I know that much-maligned banks have joined the ranks of estate agents and second hand car sales people as the butt of much humour and indeed worry. So I can understand that people are looking elsewhere for credit with which to fund their business.

But is it really right that I have to become a bank and lend people money because they don’t yet want to pay for the product they bought three or four months earlier? Now, we are lucky in that most of our clients are major multinational businesses who follow professional processes and are unlikely to go bust. But I do feel for many of the agencies we meet, who don’t have our scale, and indeed have a much broader range of clients from the megacorporation through to the smaller start-ups or innovators.

This take on the issue is priceless

I do understand that it can take time for the proper processing of invoices and their sign off for payment. Yes, I agree it is important to get such things right and correct, after all, to overpay or wrongly pay would be stupid and potentially very damaging to your business. I know from our own experience these things take time, and we are often reliant on some very busy people to sign off the paperwork that is an important part of the authorisation process. And yes, we do sometimes change payment systems which can add delay.

A good part of the solution is in our own hands. I think as agencies we should do a lot more to improve the way we work with our clients to ensure we get paid promptly. We can place more emphasis right at the start in establishing the right terms and clarity of timescales and sign-off. We can be super-slick with purchase orders and change requests. We can train our people better in the discipline of tracking work done against the reward we expect from clients. Even better, we can invest in proactive dialogue with procurement teams, with our clients’ accounts payable departments (even if they have just moved them to Bolivia). Perhaps most importantly, we need to get a little braver at the start of a project or a client relationship in getting clarity about timescales and payments.

At Loewy we manage a debtor book of up to £10m at any one time, that’s up to £25,000 for every one of our 400 staff across the group. That’s money outstanding for work we have previously done. I am sure proportionately, most agencies are in the same boat, but I do think we all need to be better at this stuff.

Is there a “right” noise level in the office?

On the one hand, I do understand that sometimes we all need a bit of quiet time to concentrate and other people’s music can be annoying.

On the other, I am used to working in busy offices with energy, noise and lively creative debate the norm rather than the exception.

I think the level of noise and energy of the office does drive the culture and attititude of people. I’m not saying noisey is good or bad, I’m just intrigued by the differences. Indeed we spend huge amounts of time with clients urging them to take control of their culture, to pull the levers of language internally, and to proactively develop the way their staff live and breathe their brands before they try to communicate them effectively to external audiences. So I guess we should look at ourselves too.

Where I am currently based,  in the relative backwater of Pimlico, our office is actually quite schizophrenic. We only have two Executive Directors in Loewy, and we share an office and most of the time create quite a lot of noise. I hope this is reassuring for most of the people around us (yes, we are alive), and welcomed by some. I do sometimes worry that the small central finance and legal teams find us a little too lively at times, but they’re too polite to mention it.

Last week I spent a few hours at Speed Communications in Leicester Square, and was amazed at the range of noise levels there: some parts, busy, bustling, traditional PR agency hubbub, yet in some, almost eerily quiet.

Now, this is an multi-award winning business, including some of the most-prized awards in the industry, awards for being a great agency to work in, and awards voted on by journalists and editors themselves. This is also the business famed for some of the most memorable social events in the West End. Nevertheless, it was surprisingly quiet in one part of the office.

Steve Earl explained that for some of their clients, so much of their work was online these days, they had less need to be constantly riding the phones to get their clients’ messages across. Wadds on the other hand (never the most shy and retiring of people), agreed it was an interesting by product of so much digital PR work.

In a few weeks the central team at Loewy are following our colleagues in The Team, Branded and Prescient across to Park Street, near Borough Market, and I have to say we can’t wait. Not only will we have the delights of Vinopolis and the Tate Modern on our doorstep, but when I have visited Prescient and the people at The Team that have moved in so far, I get a real buzz as soon as I enter the space. You can just feel the energy.

I just hope we’re not too noisey for them.

Still, the prize for the most cringe-worthy moment of The Apprentice so far goes to the original girls team back near the start, when pitching their canapé menu to the client for an evening reception. Unfortunately, Kate who was pitching the food ideas (who has otherwise been pretty good so far) had no clue about the product she was selling.

It was like an agency turning up for a first meeting and proposing…

“Some marketing, that’s what you need.
What kind?
Well you know, some, well, advertising.
Maybe some direct marketing.
Or internet.
Audiences?
Well, of course, well, erm, you know, people that watch Coronation street, there’s lots of them.
Messages?
Well, that’s obvious, our product is brilliant.”
(turns to colleague, whispers “what does this client sell?”)

It could never happen in real life…..

No I can’t hold it in. I have to get something else off my chest. I’ve had a couple of weeks off, but can’t resist some more Apprentice stuff.

These candidates give up weeks of their lives to prepare for, get selected and then actually participate in the programme. They agonise over CVs and make short films of themselves. They jump through goodness knows how many hoops to give themselves a shot at the televised series. They then commit to a month or three away from family and loved ones, and endure 24/7 cameras, and the lottery of the editing suite. So I have to ask one simple question. Just one, but it’s been really nagging away at me:

WHY ON EARTH DON’T THEY WATCH PREVIOUS SERIES?

I find myself struggling to resist the temptation to shout at the TV screen “HAVE YOU ACTUALLY SEEN THIS PROGRAMME BEFORE?”

Well, there are no longer any excuses for those thinking about applying for the next series (and you know who you are). The BBC have kindly released the highlights of series 1-4, so make sure you watch them before you make the live TV show

Before you give up your job as an estate agent (“I can sell better than anyone on the planet”), office manager (“managing people is my best attribute”) or high street bank CEO (“it wasn’t me, it was the other three”), order the DVD from amazon and make notes.

Here’s the Iain Johnston advice list to get you going:
1. do not volunteer to be team leader*
2. do not draw attention to yourself*
3. do not state you have experience or brilliance at anything – it can only go horribly wrong
4. do not argue with Sir Alan,*
5. do remind Sir Alan of your humble, wrong side of the tracks, start in life (it’s clinched the title for two previous winners)
6. do not ever, and I mean ever, say “I am not strong at selling” or “selling is not my best skill”
7. take some decent pyjamas on the show.
750. learn to add up and learn to count, especially when buying expensive ingredients for your beauty product task.

Exceptions* to the above are made for the Board Room, when you should unremittingly:
1. argue with Sir Alan and everyone else (but not Nick or Margaret who will be sure to knife you later) – it shows “balls” and Sir Alan likes this
2. do talk over your colleagues, interrupt their flow, and say very loudly “if you will just let me finish my point” even when they are not trying to get a word in.
3. do volunteer to be team leader NEXT WEEK if you think you are about to get canned.

There you go, free advice. You can share some of your “six figure salary” with me when you win, at least for the 6 weeks of the notice you inevitably give the day you start so you can get on with your new career in the media.

Once again our new friends for a few weeks on the Apprentice haven’t disappointed. Only a few weeks in and we already have some new lows of embarrassment. Of course the losers nearly always fail for the same reason – they get their costs too high - but this last week we had the delights of a qualitative assessment from Sir Alan. Qualitative judgement from so called experts on reality TV can be a frustrating process at the best of times. Many are the clear technical winners of Masterchef/Dragons Den/X Factor/Hell’s Kitchen who have been badly let down by the idiot judges, or indeed a voting public who care more about home town allegiance than whether their local lad or lass has any talent whatsoever.

Thankfully last week we did not have to wait for our bearded leader’s completely random pronouncements with a sense of trepidation, as there was only ever going to be one losing team from the moment they decided to launch their “Wake Up Call” cereals with the cartoon character “Pants Man”.

Unremitting cringes ensued, with the predictable farce of a branding task exhibiting no branding whatsoever. There was a momentary glimmer of marketing speak when one of many arguments revolved around the desire for point of sale stand out (not their words, of course) on the cereals shelf. In fact, it was in danger of getting vaguely interesting when they debated whether they should “fit in” with current colour and style norms, or to try to be different. They decided to stand out from the boring sameness of most items of the shelf (yey!), but then chose the most hideous phlegm-lime green guaranteed to put anyone off their breakfast.

All credit to our friends at McCanns for both landing the slot in the first place and managing to squeeze most of their London team into shot at the end of the episode and thereby win the “did you see me on tele?” staff motivation award. They even managed to shoe-horn some real branding content into an otherwise barren show, observing that Pants Man had nothing to do with the name of the cereal or any messaging whatsoever (“lack of brand consistency”).

Roll on next week, looks even better.

Lovely, really topical, a great April Fool’s story in Brand Republic, an otherwise respected gathering of current market news. Pigeons will be guided by some patented US military technology to deliver marketing messages in London. Great fun. And the technology is called “BYRD”. Priceless.

Still, in a city braced for disruption and chaos with the arrival of the G20 leaders (and that’s just the cavalcades, let alone the protestors), it’s a nice light-hearted take on today.