IM hits SMS – networks must innovate for their users – fast.

IM hits SMS – networks must innovate for their users – fast.

Smartphones have become category killers for things we all thought were cool (as well as representing huge profitable revenues) – pagers, alarm clocks, calculators, satnav, cameras – and before long, handheld gaming, keys, healthcare monitoring amongst others will be hurt.

Now Smartphones have begun to bite the hand that feeds it. Research shows the 20 year rise of texting or SMS has declined in 2011 – with Ovum research calculating that global mobile operators having to account for some $14 Billion in lost texting revenues – some 60% more of a decline than in 2010.

Instant Messaging – Blackberry’s BBM & Apples’s iMessenger – are free to use, more fun and collaborative. While in the UK, texting remains on a high, most Smartphones are on pay monthly deals with 100s of texts bundled in the deal. So direct revenue from texts are reducing. ARPU is under threat. What should mobile networks do?

Time for the networks to adapt – they have a relationship with the user, and understand how the users have communicated with each other for years and should see the patterns emerging from which to innovate. They have the data. They have a relationship. Time to get useful.

If 2012 is the year of mobile – has Barclays got off to the right start?

If 2012 is the year of mobile – has Barclays got off to the right start?

In December, I noted that the mobile would become the primary focus of many interactions for customers and brands in 2012. This year, Smartphones are going to outsell PC’s – with nearly 90% of the world – be that poor, developing, emerging or developed markets – having a mobile phone. More people have a phone than a home, a car, a living wage. Whereas the developed world has great infrastructure, that allow for interconnectedness at home or work and have utilities and banks with systems that rarely go down – indeed systems that are more trusted than those in charge of them – the vast majority of the world can only really depend on their mobile devices.

Money transfers and healthcare applications in the developing world are already ahead of those in the “more connected” developed world. However, this is changing. While the financial institutions are struggling to regain trust following their culpability in sending the world into recession in 2008, they recognise that their customers are demanding not only more transparency, they are expecting services that are more useful. Banks need to look to new innovations that recognise this.

In the UK, First Direct is leading the way…again. Their customer service approach has always led the way – not just in financial services but in across the board. Their use of social media has added to their fantastic phone based service to their customers. Their first direct labs and first direct live offers are great. They launched the twitter service @firstdirecthelp to more success – see the attached Econsultancy report.

As an organisation, first direct are organised around customer service and has been for years. They are a leading example of a 21st Century Brand – indeed they already were in the last Century. Customer driven innovations will always beat me too innovations and new offers that simply ones jump on the bandwagon. Too many organisations attempt to have digital and social media offers or channels without linking them to two core foundations;

  • Is the offer directly linked to the company’s purpose or DNA
  • Is the offer clearly meeting a customer need

If neither is being met, the service will flop and the brand will be damaged. If this is done in public (and all social media is in public), the damage is magnified significantly (and rapidly). Getting it right deliver significant benefits, that magnify the word of mouth of the brand, and create advocates who praise the experience. Brands need to test these innovations out internally, with small pilots. Then when they are ready to launch, control the environment so that more learning can be captured, in order to constantly improve the offer.

So it was interesting to look at Barclays new mobile offer Pingit that was launched this week. The Pingit application allows people to send money to each other using simply their mobile phone numbers. Via Smartphones, Pingit allows Barclays current account customers to send money, but all UK account holders will be able to receive money through the system, by registering online.

The messages Barclays are using to promote the service are positive and customer driven – offering a small, useful service for friends and family – rather than a world beating e-commerce (or m-commerce) breakthrough. Barclays are containing the initial users to small amounts of money and only for their own current account holders. But they’ve also announced a 2nd generation app is due that will open the service for other bank customers. This suggests further learning is being gathered before offering it to a wider audience.

While the data protection regulations prove a significant stumbling block for this kind of innovation – especially where banks need customer data to hone their offers in more targeted shapes for their customers, Barclays have got this right so far. I suspect they have a good dialogue with those of their customers who want a simpler way to transfer money. Their insights have allowed them to shape the offer for them rather than simple copy software that exist in Africa and Asia already.

Where brand have a good dialogue with their customers, then customers share not only their dissatisfaction but reveal more needs and wants. These deliver the insights for brands to shape new offers.  I think Pingit will grow significantly and be the forerunner of more apps that Banks will develop for their customers to use. If that usage provides a positive experience, then maybe the bank’s relationship with their customers will start to rebuild trust. Those, like first direct, will remain the preferred choice. Has Barclays turned a corner?

Customer Driven Innovation

Customer Driven Innovation

Today the British PM, David Cameron, is holding a summit with the heads of many of British motor insurers to address the spiralling costs on insurance premiums, driven mainly by the compensation culture that has grown rapidly over the past decade making Britain the Whiplash Capital of Europe.

With the growth of “no win, no fees” lawyers forcing up the daily claims to more than 1,500 a day, the premiums have shot up on average by some £90 per driver. Whether the Government can force enough change to halt the problem quickly seems a distant reality – but it’s good that they are trying.

What caught my eye is how the Insurers themselves are reacting to this pressure. Cynics may suggest that as it may hurt their revenue targets, they will do nothing of consequence. That’s not true of The Co-operative Insurance.

True innovation these days must be completed from the customer’s point of view rather than that of the company per se. Companies that understand the issues their customers face and change their service offer to help meet those needs will reap the biggest reward – that of differentiation and better still, customer preference . With customer preference – based on a great experience – comes advocacy and positive word of mouth. Word of Mouth is the most sought after of all marketing communications today.

The Co-operative insurance deserves this positive word of mouth.

Young Drivers are the hardest hit by these rising insurance premiums. It’s quite normal for young drivers (17-23) to pay three times more for their insurance to drive a car, than the car actually costs! Many young or first time drivers can be charged £3,000 plus for insurance – without having had an accident!

The Co-op insurance has recognised the inequality of this situation by developing a special package for young drivers that measures how the driver is actually driving – driving safely is measureable – and then rewards the driver by reducing their premiums. This “Smartbox” is installed in the car and, like satnav, records how the car is driven and feeds back to the Coop people. They then update the online dashboard to show the driver how they are driving too. Good, safe, consistent driving is then rewarded. And the premiums come down.

Customer driven innovation comes from listening to customers and doing something about it. Sounds simple, but it usually involves much investment in time, energy and focus – traits that are a scarce resource these days in many companies. However the upside in the relationships those customers have with those companies that clearly recognise their needs and not only listen, but do something about it, are enormous.

When my son starts thinking of driving in a couple of years, the Co-operative Insurance should be a market leader in the UK for Young Driver Insurance. Quite right!

Running to stand still? Break the inertia, creatively.

Running to stand still? Break the inertia, creatively.

 

Do you feel like the hamster in the wheel? Running like crazy to stay where you are? Expending massive energy without moving onwards? Pressure is on to deliver more from less. Stress levels are rising as leadership expect new things faster while, at the same time, demanding nothing slips. The day to day processes are busier than ever, yet new growth needs something different to ignite change. Do you suspect external change is a great opportunity but the internal change needed to stimulate it is impossible to budge?

It’s never been as important for companies to develop new ideas, or as difficult to successfully launch them. After years of efficiency-driven cuts and bottom line focus, companies need new growth and meet new customer needs. Most of the skills required to address these needs have been eroded or outsourced by organisations. Marketing departments have been cut along with their budgets, yet leadership is demanding more from less in double quick time.

Companies see there are opportunities out there but are often stuck focused on the day to day processes needed to survive, or so concerned by gloomy predictions, that they become stuck in fear-fuelled inertia. Breaking out of inertia is vital as new ideas and innovations need to be tested quickly. Often, change needs to happen inside organisations in order to successfully create change & growth externally.

Innovation is no longer simply the focus for developing new, disruptive technologies and products.

Increasingly, companies are attempting to reshape their culture and physical work environments to encourage creative thinking across their enterprise.

But too many of the creative skills needed for change are being outsourced, yet new ideas that are owned and driven by internal people have more chance of being implemented.

One problem in attempting to instigate a new culture for encouraging creativity is that it can take time to set up. Failure should be treated as a positive learning experience and encouraged. At first, ideas are often generated in isolation of those they are intended to influence and this adds further time before the new ideas can be implemented. More time can lead to further pressure from leadership for the change, often adding to the inertia.

Perhaps the best idea is to consider smaller scale projects to create a short term actions in order to escape the inertia. To start to add some business creativity inside the organisation via a new initiative with a team that spans different silos – and include some “Doubting Thomases”. Give these teams’ space and time (a week or so) to try something new. Mentor these teams in benefits of collaboration and let them create some internal actions for change. Don’t put more stress on them – free them up to have fun in creating new things.

But make sure the context is clear. Interrogate the customers. Bring the competition to life. Use newcomers to the company in their first few days to represent customers or competition as part of their inductions. Create a map of opportunity that could your offer be outside & evaluate what is stopping you on the inside getting some new actions to address them.  Challenge the teams to create a momentum that gets noticed but via new initiatives that create a bit of a stir. Encourage them. Forgive them. Celebrate a failure & get them going again. Ensure they establish the barriers that stop a company experiment more freely. Maybe make the exercise all about breaking down such barriers!

By making the projects have an outside-in context in order to shape the initiatives and innovation, the possibility of change attaining growth increases. As changing the inside in order to deliver on the outside may allow the hamster wheel to move off its fixed axis and allow all that energy to burst forward and start a new momentum.

Is Brand 3.0 better suited to B2B marketers?

Is Brand 3.0 better suited to B2B marketers?

Business to Business (B2B) and Service Brands have long needed brand thinking that is different to the Mad Men inspired thinking that broadcast messages to consumers and relentlessly defended the positioning against competition. Customers and Users have moved on. Services and products cannot be based on a transactional basis alone because customers demand more understanding of their own “unique” needs.

Customers are complex and demanding of experiences that are rewarding – not just for themselves and their own company and customers, but for the communities they exist in. The bigger companies exist in communities that can be better named as society and the Multinational’s community impacts on the environment, mankind and future generations – think of Paul Polman’s Unilever Sustainable Living program or Bono’s Product (Red) or the Microsoft’s legacy work of the Gates Foundation. Sustainability is now a core tenet of 21st Century growth and companies on both sides of the B2B equation know this. Soon Procurement will look not simply for lowest cost tenders but how future offsetting on sustainability policies are incorporated. Carbon trading is becoming regulated by the governments and will soon be a mandatory prerequisite in many big tenders.

Great B2B marketers know the value of Partnerships and that by innovating new products and services via partnership can mean that Enterprises can shape and test new business models – but also that they will see new revenue streams to lift their old models.

Understanding the wider benefits for the customers’ communities and using new partners & business models to grow will add value to the company’s offer by adding an enhanced benefit to the customers (& their own customers & staff). Another tenet for the 21st Century is speed. Expectation for improvements, for new, for understanding or for better…all to be delivered at faster speed. For some more traditional companies this is harder to achieve than for some newer tech enabled successes. Companies that may suffer from “Silo Slowness” will need help in change & marketers can help bring this need for speed to fruition by bringing more business creativity initiatives into the organisation’s processes.

Marketing in a B2B environment has never really been a pure communications role – the organisation has traditionally been geared up for service – so an understanding of the customer journey (or their customer’s customer journeys) is already part of successful B2B companies. Marketing must be relentless in understanding customer’s needs – not what they were but what they are & importantly will be – not just insight but foresight.

As marketers, their roles are complex and can be a mix of investigator, integrator, innovator and instigator. B2B marketers have to help bring a company’s focus to customers future needs – and today that can mean being useful & optimistic.

In order to connect to their customers they must be useful – consumer marketing is many ways are still learning this. Engaging customers is not simply a good story well told. Mad Men thinking is fast being left behind. Indeed B2B never needed Brand to mean advertising campaigns or corporate logo – they needed brand to rally the staff and the service around a customer’s needs. Cisco and Oracle are fundamentally benefit driven. Brand as communication was termed tactics not strategic – strategic brand thinking centred on R&D for their customers. Today’s economic woes mean the inertia many companies are struggling with needs marketers to look positively into the near future and identify some quick opportunities and highlight possible actions that can lead to grab them.

Where B2B marketers can struggle is when the organisation is geared in delivering products or services that are complex – in the building of the product, in the testing, in describing or in their delivery/installation. Such companies can consider they’re a specialist and will be run by engineers or technical experts who have grown up with the company or the category. These leaders will understand the complexities of the offer/service and develop it incrementally year after year. Innovation may well be inherent inside the culture (as they are always seeking improvements) but this innovation will be familiar rather than surprising. Incremental sales and efficiency are valued and expected. In such companies, Sales and Marketing often work as a service to the engineers and developers. Country & category operations run the same way. Customer service will be ensuring products/services work as promised and lessons learned are shared back to organisations sporadically. These leaders believe marketing as a support function should deliver 20th Century branding.

Marketing can still be useful – but needs to be heard. This can mean being challenging and even disruptive – but from a need for change perspective, engaging cross discipline teams on new initiatives, on creating a few, small actions that are future facing, the results of marketing’s voice may rise.

Without an effective voice from marketers, B2B companies can over focus on their product features and then attack with pricing tactics vs. competition, and not the benefit experiences their products and services deliver to their customers. Benefit driven pricing can be higher if they are clearly valued. Cost optimisation comes to the fore, everything is shaved & discounting can become a primary sales strategy, and they have to price their products like a commodity.

B2B marketers can succeed & own the new brand thinking by

  • Great insights and foresight on the customer’s needs
  • Innovating partnerships for new business models (& new revenue)
  • Drive value via the benefits for customers vs. simply delivering best competitive pricing
  • Seeding the internal story around the brand so building the value to customers communities

The need for speed

The need for speed

Get creativity into your organisation: change for the quicker – change for customer.

Turning round your business is tougher than for years – customers are more demanding, more cautious, more reactive.

Businesses are under increasing internal pressure from budget cuts, higher expectations (more for less) and increasing uncertainty.

Clients themselves have reduced their own teams and are trying to achieve the same tasks. Time & focus are their most precious resources.

And everything must be delivered more quickly.

Expectations for quality improvements & for better value can increase the pressure for being faster. Businesses rely on quarterly reporting periods to satisfy shareholders & use leadership models that rely on management by objectives to ensure conformity and consistency rather than change. Short cuts and new innovation are stifled by bureaucracy.

In the risk-driven inertia that many businesses are in, decisions take longer and tend to be safe – often familiar and repeated from past. Falling budgets can result in shaving a bit off everything rather than a refocus on doing just one or two things really well. Silos have built up internally, with a sense of protectionism leading to poor internal communications and mistrust.  This can be replicated externally with too many agencies focused on their own specific disciplines – with each agency duplicating similar processes in dealing with the client – so adding to further delays.  These pressures also sour culture which in turn causes delays and further inertia.

However, quicker is the norm for many businesses and organisations especially those influenced by new technology – where the use of creativity is ingrained in their business models. Fantastic crowd sourced content is uploaded every minute and quickly spread to people who look for their recommendations on social media. Millions of apps and upgrades are beta tested and rolled out every week on technology we already cannot live without. News is delivered 24/7.

If customers are demanding better experiences and best quality on one side of the value equation, price differentials are getting narrower on the other. Price comparison sites and supermarket price wars mean the price isn’t a differentiator but a similarity. Premium prices are harder to justify.

So how can creativity in business be applied to help speed things up, to unleash new initiatives for customers without compromising quality so building trust rather than losing it?

Creativity in its purest sense is forming a new solution from existing elements. Therefore it is always good to start by interrogating exactly what is happening inside the business, breaking it down into small discernable elements and reconfiguring them again into a simplified, customer focused approach. Ask the organisation direct questions (some are illustrated below) to get the answers that bring these elements to light.

The solution will come from being bold in questioning what’s working and why as well as what’s not. Collate the answers into groupings that can be reassembled. Prioritise the answers to ensure they are  relevant to each part of business and importantly to each business leader.

  • Is everyone in the business clear about what we do & why? Is there clarity and conviction about the purpose of the company?
  • Is our own story inside the business as clear as it is when we communicate outside?
  • Are we all about the customer or all about ourselves? Do we think inside out or outside in?
  • Do we have a dialogue with lots of our customers – daily not annually, sentences not tick-boxes?
  • How can we simplify everything…and after ask again, can we simplify further?
  • Do we share & train each other in what works?
  • Do we regularly work together outside of our own internal teams – on behalf of the customer?
  • When we undergo performance reviews for our leadership and staff, are there consistent KPI’s about collaboration & the customer?

By understanding the answers to these types of questions, you can creatively develop new initiatives, new processes & new teams. Restructures don’t necessarily have to mean redundancies – they can mean new responsibilities.  By simplifying these processes and ensuring each is strictly evaluated on a customer focused basis, things will get faster. Today, it is cost effective to use real time customer feedback in developing and spreading these initiatives – online dialogue is flexible and rewards the customer who expects their voice to be heard.

Once they do the results on culture will be positive. As a few directions become clear, it will be wise to quickly try out a few small tests – start with manageable, realistic goals, ensure leaders support these teams overtly and that failure is supported as much as success – to ensure a do/learn/do approach to learning is invoked – and when these tests work, roll them out & start a few new initiatives. Taking action quickly via business creativity creates actions that break inertia, break silos and start a road to growth.

So while many companies use creativity to communicate to their customers, they can start to seed creativity into their business structure, planning and processes too – with valuable outcomes such as improving speed to market, rewarding customer experiences and an improved internal culture.

Marketers Action Plan …take some.

Marketers Action Plan …take some.

This morning, I met Stuart Pocock, managing partner of The Observatory, a global agency search and selection organisation. Stuart has a great insight on global trends facing Marketers and their agencies as we turn and face 2012. The Observatory believe that while clients who engage them have made a decision to change an agency roster, the solution maybe to fix a relationship (on both sides), before undergoing a selection process. Deciding on what is the best option clearly depends on each situation, but there are common issues that can help clarify why a decision needs to be taken.

Overall, many senior marketers are feeling increasingly constrained by being time starved and resource stretched. Their budgets are being reduced yet expected returns on these investments are increasing. Their own teams are being reduced while their agency rosters have increased. Senior marketers have to prioritise where they focus their time with a main agency(s) and often have to delegate others to look after other disciplines, sometimes not changing that focus as one discipline’s importance for the brand increases.

Bigger clients have extended their agency partners to handle new disciplines or countries. Each agency has a team made up of talent and account people, juniors and seniors. Their team’s make up are often procured on an FTE basis (full time equivalent people with % of timesheets being allocated to an account and costed) rather than on people basis (to create the best outcome, quickly). Too many junior people without the experience to cut through instinctively and create solutions. Too many assistant brand managers with the power to say no, rather than, yes.

The broad team structures mean that the processes are inefficient and slow. Too much duplication and checking in rather than creating and doing together. Making things truly integrated is hard when there is a distinct lack of collaboration as too many people have conflicting goals & KPI’s to be judged against.

There are too many silos affecting brands – inside a company and outside with the agency rosters. Silo’s who become disconnected to the customer journey they are meant to be supporting. Making that journey inconsistent and focused on a company rather than a customer.

Stuart’s summary answer to my original question about what’s keeping Marketer’s awake is telling…”Everything!”

Fixing everything takes too long. Worrying about everything causes inertia. Worrying about what to do in the unknown face of another recession will add to the fear. As Dale Carnegie suggested, “Inaction breeds doubt and fear. Action breeds confidence and courage. If you want to conquer fear, do not sit home and think about it. Go out and get busy.” Taking action is vital. But what? We suggested some a couple of weeks ago on Double Dip Marketing.

What will help is to create a few, small, incisive actions – with an immediate next step and a way of capturing, and then sharing, that learning. Actions that that can stimulate a brand with the customers. Actions that can change the way you do things inside your influence sphere. Create a small, senior team from your agency and team – and deal only with them. Recreate your brand story to ensure all touch points inside and outside your organisations are on song together. That way means collaboration, which is the best way to integrate. And the best way to create.  And use both of these actions to innovate at warp speed.

As Marketers face up to 2012, there are many things, fuelled by media headlines, that are causing fear and inertia. But there are still unlimited opportunities out there for brands to take action and start a momentum that will help them grow and gain significantly as markets turn again, which they will.

Too big. Too slow. Too much noise. Choose to collaborate & create rather than efficiently manage

Too big. Too slow. Too much noise.

Choose to collaborate & create rather than efficiently manage

I had a good discussion over the weekend about the future alignment of big agencies and big brands. The debate focused on three core issues

  • How we need to test more things out to meet the changing needs of customers
  • How much quicker everything has to be
  • If the big agencies are geared up for such fast turnaround & innovations

Really the debate was around the final question – I know they are trying to change but not always succeeding. Time is running out. I believe that this current downturn will cause fundamental changes to the relationship between clients, brands, agencies and consumers. The pressures that will force this tipping point are both from clients and from within the agencies and, specifically, their top talent.

The proliferation of specialist agencies that started 20+ years ago with media separating from creative, relationship marketing execution separating from advertising, identity studios involving into brand consultancies, the rise of digital specialist beyond web developers and online advertising and the formation of a few places that are more generalist idea not execution offerings has left clients dealing with too many agency contacts, all great at some things but not everything. During the same period, the Management Consultants have proliferated exponentially inside many of the same clients. It’s no wonder senior clients feel time starved, over advised and generally frustrated.

Even though many of the Holding Companies have been successful in pitching a “one-stop-answer” for Billion Dollar businesses, these pitches are so in the sights of procurement that the decision is only over lowest price and how many people (sorry, FTE’s – full time equivalent people) are involved in the deal. Therefore the focus is driven by a combination of efficiency (to make the deal profitable) and management (to ensure consistency of service) as much less on delivering better creative ideas. Consumers and customers (and indeed staff) need to be understood, connected too, delighted and heard, which are driven by creativity, insights, cut through and smarts = better creative ideas.

Sure, the Holding Company has a number of specialist agencies who are geared up to deliver their specialism brilliantly – and they do. A lot of clients form their own rosters of specialist agencies who are world class at their specialism. There is great talent in these agencies – but too much overlap and duplication stops the talent performing at their best for the brands.

The overlap takes the form of big teams with too many different disciplines working apart and only occasionally meeting. A big brand may have between 5-7 agency teams working on it. These teams usually work in different agencies or on different floors within big agency groups. All teams have roles that are specific to the agency and not for the client. They are assigned by a basic billing model that allocates a percentage of time per task.

Too many agencies still have first-point-of-contact people who represent the agency to client rather than create things or provide insight. Many of these traditional roles are replicated across each of the client’s agencies – whether from the same holding company or not. Too many account managers or project managers or junior this and still-in-training-for-that. Important internal roles, less important external roles, but all the roles are accounted for, paid for and in each process from each discipline & in each agency. Clients also have proliferated roles to look after executional disciplines and follow the process to execute things with too many levels and with a niche focus aimed inside a company rather than in gaining real insight with their consumers outside,  in order to provide meaningful, rewarding experiences that is demanded of 21st Century Branding.

We hear a lot about noise from a consumer’s perspective with millions of messages in too many channels – ironically there is an internal noise in these agencies that can be distracting for both clients & negates the very reason they may have hired agencies in the first place – namely to create and improve brands and their relationships with consumers, customers and staff -  but also the noise affects the top talent inside agencies. The ‘noise’ takes to form of

  • Running an agency – reporting, communicating, managing, meetings, meetings
  • Reporting to the holding company
  • Internal processes (often to update people for not at client meetings)
  • Being allocated to other clients (it’s not uncommon to add the FTE percentages so that people are allocated 3 months for every one month of time)
  • New business gathering
  • Training younger people – or use them as blockers.
  • Meetings, meetings, meetings, politics, politics, politics

This noise not only distracts the top talent away from building brands, it frustrates them. Everything slows down the processes of creativity. The talent spends less & less time with the client and at the client and/or in the world learning – it has a big knock on frustration at the client too. The frustration has always been there, but today, the holding companies are so pervasive, a lot of options for clients and agency talent can seem to be out of the frying pan & into the fire.

Their clients need talent to succeed in getting new ideas our more quickly but are getting increasingly frustrated when the good ideas are slowed by over burdensome process & models and or in forms that are difficult to test – these days testing has to be done in real markets not in real market conditions or focus groups and be small enough to fit on a model of “do, learn, do again, do different.” This includes having dialogue with consumers on a weekly basis not in annually or for a big launch.

The change has begun. Some of the clients are early adaptors. Much agency talent are leaving to collaborate with other talent to create new models, to choose to work on projects they want too, or with other talent they respect. The freelance model of choice. Smaller creative boutiques are happy to recognise they don’t know everything but know enough talent outside to mean the client can get access to the best talent. Clients are picking specific teams from their agencies to work directly with together rather than via each individual agency. Virtual networks, collaborative villages used to be the prerogative and vernacular of tech start ups.

Hence the rise of “open source collaboration” – whether within smaller, more fleet of foot, agencies set up to keep that way or choose to work as an individual or dynamic team to focus on creating & making things. Clients want to work with the best creative and strategic talent. They are rarely all in the same agency. And they are always the most sought after in the agency. Holding Companies don’t always give top talent the freedom of choice or the full freedom to create. Clients themselves  have too many balls to juggle to stand still.

Creative collaboration direct with clients and consumers is one way of ensuring that breakthrough ideas are tested quickly in order to build growth back into a clients business. At the same time, it breathes passion back into creative people – right and left brained brand builders who want to make a difference  – who are not turned on by efficiency and management process that they are increasingly frustrated with.

Smaller, faster, focused creativity is like adrenaline to the best agency talent – not managing efficiently. It’s choosing to give your all to a project or a brand. The same at the client. The same for consumers. The effect is positively infectious. Of course there are times when it still happens at big agencies and big brands. At pitches and launches – in times of crisis management. The trick is to make these acute one off periods more regular, more often. Otherwise what will happen is that creative brand projects will be worked on by a creative collective – to deliver a powerful impact to a consumer’s experience or a meaningful role for a company’s staff on the customer journey.

These collectives will not be retained to work beyond the agreed project. Another project could follow but not immediately with the same brand. The teams will mix and match themselves over time to complement each other to drive each solution and then move on to choose another. As this process developed, creative talent & innovators will merge with other advisors in the management consulting field. Choosing to collaborate, whatever the fee or reward is for the collective or the client will be based on short term shared goals and outcomes. This form of collaboration provides the opportunity  for each person, client or creative, to keep being curious,  right or left brained, to make an impact, to be a part of a wider community, to solve difficult or interesting problems quickly and feel increased self worth, beyond the measure of a salaried job with the accompanying processes and management responsibilities.

So yes, it was an interesting debate on Saturday night. An optimistic one too, because these are times of change, where action will trump inertia, and fear fuelled doom mongers do not have to be right. The debate happened at a charity ball for Mencap’s Grove Cottage. The power to do good by many for a few was apparent, in our little community.

 

 

 

Hailey’s Comet – innovate the brand rather than cut off the tail

Hailey’s Comet – innovate the brand rather than cut off the tail

When Best Buy shut down UK operations yesterday, a John Lewis spokesman got it right when saying :there was no gap in the market. Today, Kesa shed itself of Comet for £2 to a group of companies under the name “Hailey” advised by retailer turnaround specialists OpCapita.

Hailey’s Comet – geddit?

Kesa have invested £50M into Hailey and covered the staff’s final salary pension fund. Hailey’s Comet will burn for at least 18 months (they “promised”). The goal is to sell it on then or after for £70M+ assuming the chain has indeed turned around. Kesa had already been fighting the downturn by shutting down 17 stores and was “right-sizing” more. Hailey will no doubt be fast tracking this faster and deeper to drive profitability on declining revenues.

Which makes one wonder what the future of these bigger out of town operations? Especially for infrequent big ticket purchases? No doubt people will still buy what the big Electrical Outlets offer – once a year or less rather than what was twice a year or more.

But with everyone becoming savvier in online research and the importance of recommendations, what will drive people into the stores that they do not pass frequently? Smaller High Street stores work for smaller electrical and tech offerings (Carphone Warehouse’s skills not Best Buy’s) or offer an all encompassing experience (Apple Store) that will draw more regular visits without a desire for specific purchase. Argos has cracked its digital search app brilliantly to order & reserve before going to store to pay & pick up – and use GPS to make it yet more relevant.

How can Hailey turnaround what Kesa couldn’t? Cost optimisation will not be enough. The Comet Brand Experience will need to be reinvented – and that cannot start with price promotion advertising but with innovations on the whole customer journey. Innovations that should include a new digital dialogue or friendly & rewarding search and information applications and then through to expectation beating in store experiences. The aftercare option cannot be confined to selling expensive and unwanted product liability insurances.

There are enough Comet stores that Hailey can test out different experiences on different customer journeys – and then accumulate the total learning into the whole group. Such a programme could and should lead to turning around revenues as well as whatever Hailey decides to do with cutting off its tail.

If they fail, there may well be a gap in the market – the real Hailey’s Comet is due back in our solar system in 50 years…what will be happening in retail outlets then?

Best Buy – an avoidable failure.

Best Buy – an avoidable failure.

Best Buy UK’s closing down of their 11 Big Box outlets is being touted today in the broadsheet newspapers as a failure due to a combination of “naivety & arrogance” which was compounded by the sharp economic downturn. While the UK story has abruptly collapsed to these poor headlines, the partnership between Best Buy and Carphone Warehouse hasn’t been a disaster and both strong brands remain strong in their markets.

Best Buy’s US brand is a very resilient and they are out making a Superbowl commercial ( for only their second time using a weird father/son duo of Ozzy Osborne & Justin Beiber!). Their in-store experience consistent and rewarding not least through their Geek Squad sub brand. Their UK partner, Carphone Warehouse has a similarly strong brand and consistent experience.

The JV’s European management is strong with Messers Dunstone and Harrison well versed in branding and retail. Indeed, with Best Buy taking up the successful US partnership and buying out Carphone Warehouse, there is considerable financial upside for Carphone and the European JV partnership will continue – but in outlets that will represent Carphone Stores rather than Best Buy with a strong Telco focus.

What went wrong in the UK? The economic times were clearly a bad backdrop, but the failure seems to be down to 2 key reasons, which should have shown up in early planning and could have been avoided. The focus on big out of town outlets and the disappointing brand experience

Best Buy UK had just 11 big stores. Out of Town sites are expensive (particularly in UK compared to France & Germany and even more so than in the US). Planning permission is tortuous. Regular visitors to the parks are usually only to supermarkets. Visitors looking for Big Box electronics and Home improvements and the like are now less than once a year or so. Their established competitors had hundreds and hundreds of stores and were eager to compete against the US invader.

Their Best Buy brand was launched with big ambitions – National Advertising and big price discounts promised. The assumed poor service of their competitors improved and customers were able to browse Best Buy & walk across to Comet or Dixons and browse/compare based on product and pricing at which Best Buy weren’t clear winners. Customers would have done this online too and may have only gone into Best Buy as it was a new experience. To succeed, the Best Buy experience needed to beat expectations, expectations they themselves were setting.

Was it a good experience? The range of products inside were disappointing – often significantly less than their competitors. The discounts were either short lived or only premium products. The Geek Squad failed to live up to the hype (the US Squad rocks!). The advertising didn’t differentiate. Why was it so American? Where was the humour for the UK marketplace? Too many customers in research assumed that Best Buy was an American grocery outlet.

The economic times didn’t help. Indeed Best Buy should have entered the UK much earlier. Today, there isn’t room for 3 competitors for such an infrequent expensive purchase. But to go in with an all singing, all dancing BIG brand promise missed the mark. A smaller test, via a single store say, to hone the right offer, the right experience and the right brand for the UK market which can then be heralded more overtly and growth taken slowly, 21st century brands need to be tested and nurtured with their customers. Too many assumptions seemed to have been taken and then wrongly accounted for in planning.

A shame as the Best Buy US experience is a very good one. As is the Carphone Warehouse experience. But they are different and were always likely to be.