Throwback gadget: shareware

Back before the internet became ubiquitous, software was distributed by bulletin boards. It was expensive to dial into a board, so magazines uses to have storage media pre-loaded with applications on the front of them.

For much of the late 1990s and early 2000s my parents used to use MacFormat magazine CDs and floppy disks as coffee coasters. One disk may come with bloatware such as the installation software for AOL, Demon or Claranet. The other disk would be full of free or paid for software.

The paid for software was often written by a single developer. It was a labour of love / cottage industry hybrid. Often the developers wrote the software to deal with a real need that they had, it was then passed on as they thought others would benefit as well.

Open source software the way we understand it now was only in its infancy in terms of public awareness. Packaged software was big money. As recent as 2000, Microsoft Office for the Mac would have cost you £235. Quark Xpress – the Adobe Indesign of its day would have cost in the region of £700+ VAT.

Into the gap sprung two types of software: freeware and shareware.

Freeware was usually provided as is, there was little expectation of application support. It would become orphaned when the developer moved on to other things

ChocoFlop Shareware Style

 

Shareware usually had different mechanisms to allow you to try it, if you could see the benefit then you paid a fee. This unlocked new features, or got rid of nag screens (like the one from image editing app Chocoflop).

In return you also got support if there was any problems with the app. Shareware hasn’t died out, but has become less visible in the world of app stores. One that I have been using on and off for over 20 years is GraphicConvertor by Lemke Software. It handles any kind of arcane graphic file you can throw at it and converts it into something useable.

Kagi Software were one of the first people to provide programmers with a way of handling payments and software activation. Kagi provided an onscreen form to fill out, print, and mail along with their payment. it was pre-internet e-commerce.

I can’t remember exactly what utility programme I first bought for my college PowerBook, but I do remember that I sent the printed form and cheque to a developer in Glasgow. I got a letter back with an activation code and a postcard (I’ve now lost) from the Kelvingrove Art Gallery and Museum.

Later on, Kagi were one of the first online payment processors.

From the late 1990s FTP sites and the likes of download.com began to replace the magazine disk mount covers. Last year Kagi died, making life a little more difficult for the worldwide cottage industry of small software developers. it was inconvenient, but now with PayPal developers have an easy way to process payments and there are various key management options.

It’s time that we talk about micro-influencers

Much of the social marketing today for consumer brand is done through what is called influencer marketing. For a number of these influencers who have a large social following, working with brand has become very lucrative. But one of the hottest tickets at the moment within communications agencies are ‘micro-influencers’; Edelman Digital lists it as a key area in Digital Trends Report . There is widely cited research by Marketly that claims there is an engagement ceiling (at least on Instagram). Once a follower count gets beyond that, engagement rates decline. This micro-influencer sweet spot is apparently 1,000 – 100,000 followers.

What are micro-influencers?

Brown & Fiorella (2013) described micro influencers

Adequately identifying prospective customers, and further segmenting them based on situations and situational factors enables us to identify the people and businesses – or technologies an channels that are closest to them in each scenario. We call these micro-influencers and see them as the business’s opportunity to exert true influence over the customer’s decision-making process as opposed to macro-influencers who simply broadcast to a wider, more general audience.

Brown & Fiorella wanted to focus on formal prospect detail capture and conversion. It sounds like an adjunct to integrating marketing automation from the likes of Hubspot and Marketo into a public relations campaign.

This approach is more likely to work in certain circumstances:

  • Low barrier to conversion (e-tailing)
  • Business-to-business marketing – for instance Quocirca did some interesting research back in 2006 that showed endorsements by a finance directors peers at other companies was likely to have a positive effect on a prospective supplier

Brown & Fiorella’s thinking tends to fall down, when you deploy their approach to:

  • Consumer marketing
  • Mature product sectors
  • Mature brands

Brand preference and purchase is much more dependent on reach and repetition to build familiarity and being ‘top-of-mind’ as a product.

Most money in influence marketing is spent in the consumer space as B2B marketing tends to struggle with:

  • Reach
  • Volume of conversation interaction

(At least outside of the US).

Brown and Fiorella are 180 degrees away from the approach of consumer marketing maven Byron Sharp and his ‘smart’ mass marketing approach. This means that PR and social agencies are often out-of-step with the thinking of marketing clients, their media planners and other agency partners.

Engagement matters less than reach or repetition of brand message for mature sectors or brands. For many consumer brands the drop off in engagement amongst macro-influencers is a non-issue, a red herring.

The only part of the engagement measure that I would be concerned about in that case would be content propagation amongst my defined target audience – how widely had it been repeatedly shared as this would affect total reach.

If the client and planner are using Sharp’s thinking then this audience would be wide, but a certain amount of the propagation would be wasted – for instance outside targeted geographies.

From the perspective of communications agencies I can understand the obsession with engagement being part of their DNA. These businesses are in the offline world are engagement agencies; whether its politicians, regulators, fashion stylists, movie set designers, editors, journalists, TV producers or DJs.

Why are micro-influencers a hot topic now?

The most obvious reason is that more popular ‘macro-influencers’ are well informed about their commercial value which has been driven up to a point where they look expensive in terms of cost, even if you charitably look at it on a ‘per follower’ basis.

On the supply side of the equation influencer representation benefit from having more ‘inventory’ that can be sold at various price points to marketers.

Challenges in influencer marketing

From a marketing perspective there are a number of issues in influencer marketing – these factors are either unknown data points or represent an issue with the brand experience

  • Quality of brand placement
  • Cost per reach
  • Consistency of reach (how confident is the media planner that the influencer will achieve a certain level of reach)
  • Message repetition amongst the audience that I want to reach

Which makes it harder to factor into an econometric model that would help justify the investment in influencer marketing as a contribution to sales.

Let’s have a look at data around a campaign for a smartphone manufacturer that has been touted as successful by the agency involved. We don’t know the cost as its likely to be client confidential.

  • 2 million YouTube views (we don’t know how many of these were driven by advertising)

  • 75,000 likes

  • 13,587,159 impressions driven by 6 influencers

  • 10,689 clicks from 90 posts

  • 10 million impressions for the promotion of a colour variant of the smartphone model and 92,320 engaged

  • 4.6% engagement rate (which we’re assured is 41% higher than the industry average for branded content)

What this doesn’t tell us:

  • Reach amongst target audience
  • Repetition amongst target audience

Which could then be used to provide an estimate of its contributory factor to sales if you had an econometrics model. You can’t access how it works next to other tactics and there are limited outtakes for the learning marketing organisation.

Quality of brand placement

Many brands have struggled to get their brand in the influencers content in a way that:

  • Represents it in a meaningful way (for example beyond unboxing videos, one smartphone looks rather like another)
  • Doesn’t feel ad-hoc or awkward

Some luxury brands have managed to get around this by keeping control of the content; a good example of this is De Grisogono – a family-run high jewellery and luxury watch brand. They work with fashion bloggers that meet their high standards and invite them to events. (It’s obviously an oversight on their part that I haven’t had an invite yet.)

De Grisogono provides them with high-quality photography of its pieces and the event. They get the best of both worlds: influencer marketing but with a high standard of brand presentation which raises the quality of the achieved reach.

There is a school of thought that micro-influencers will be easier to manage in order to assure quality of brand placement. However, micro-influencers are likely to be aspiring macro-influencers and each will have a clear line of demarcation in their own head that they won’t cross. The reality is one of complexity dependent on:

  • Brand power
  • Relationships
  • Credibility of proposed idea
  • Impact on aspirations – could they get more followers by taking a stand and strategically burning a brand?

Cost per reach

Influencers tend to talk about themselves in terms of the number of followers that they have. However many followers seldom engage with the influencers content. This happens for a number of reasons:

  • The follow button is often used as a book mark or a like button
  • Algorithmic changes to social platforms and the volume of the social firehouse itself drown out brands (and these influencers are all about the brand of ‘me’). Whatley and Manson’s research at Ogilvy on the decline of organic reach in Facebook pages  is worthwhile having a look at

Followers as a data point is not the straight analogue of reach that the industry and influencers would have you believe based on how they present their data.

Reach numbers that are presented are often not that much more useful:

follower

(Data via Golin, TapInfluence and Marriott)

Consistency of reach

So influencers may give us follower numbers or ‘total reach’ calculations but how do we know what reach their brand placement content is likely to achieve? At the moment, I don’t know how consistent influencers are, I have a ‘personal time’ data project currently in progress on it. More on that hopefully in a later post. There isn’t off-the-peg data that I know of, so I am pulling together a data set.

Message repetition

Until we understand the ‘quality of brand placement’ we wouldn’t be able to understand whether a piece of influencer content was a point of content delivery. We’d also need to know do audiences of influencer A also look at media channels or other influencers that we have in our overall media plan. There often isn’t an overall media plan and there often isn’t sufficient quality of audience data for influencers.

More information
Edelman Digital Trends Report – (PDF) makes some interesting reading
Instagram Marketing: Does Influencer Size Matter? | Markerly Blog
Influence Marketing: How to Create, Manage and Measure Brand Influencers in Social Media Marketing by Danny Brown & Sam Fiorella ISBN-13: 978-0789751041 (2013)
Facebook Zero: Considering Life After the Demise of Organic Reach

Belated Christmas Gift: updated set of marketing data slides

I started pulling together and publishing different data sets focused on online marketing from social platforms to the size of mobile screens. I think that it might be useful for strategists and planners. Feel free to use. If you do find them useful drop me a note. You can scroll through the embedded version below and download the PowerPoint version here.

Opportunities for PR and brand communications from 2017 onwards

2016 has been a watershed year in the western world. Political forces that were simmering, but previously untapped manifested themselves in populist victories. Political norms that were common currency for the past two decades have been brought into question and there will be societal impacts and changes in consumer tastes.

Businesses are being buffeted by these changes. In the case of the UK; supply chains will be re-engineered over the next two years to address the country’s departure from the European economic bloc. Most companies that I have spoken to are working on the assumption of the hardest Brexit:

  • No trade agreement with the EU
  • No customs union with the EU
  • No passporting for services such as banking
  • No agreement on storage of EU or US personal data in the UK
  • No free movement of EU talent
  • Problems with the WTO as countries look to settle scores like ownership of the Falkland Islands and Gibraltar

This presents communications teams with opportunities and challenges:

  • There will be new regulatory and legal environments for companies to navigate
  • Corporate and social responsibility programmes will need to be recalibrated
  • There will be change management as jobs are moved abroad and facilities closed
  • Brands will have to work smarter with less
  • Consumer data based systems will need to be redesigned to meet the new legal and country boundaries imposed upon it
  • UK businesses will need to prepare for permanent handicap on their profits

There is also a wave of change for consumer businesses. Whole categories of products – carbonated drinks, cereals and spreads are losing market share to substitute products. This is hitting the large FMCG (fast-moving consumer goods) brands including:

  • Unilever
  • Coca-Cola
  • General Mills
  • Nestle
  • Kelloggs

Consumer brands have looked to counteract this in a number of ways:

  • Putting their spend where it will do the best work by using zero-based budgeting (ZBB)
  • Restructuring brand architectures – moving away from preventing brand damage through brand extension to brand consolidation to maximise the benefit of marketing spend. Coca-Cola is a prime example of this
  • Brand architecture will create a tension in the organisation. On the one hand the societal norm will be for local brands rather than global, on the other you have the corporate desire to cut and simplify to maintain margins. Whilst some companies may kill brands, others may sell them on to local companies, which will then try to squeeze as much value out of the brand equity as they can
  • Move away from micro-targeting to ‘smart’ mass-marketing – the key exponent of this is Byron Sharp at the Ehrenberg-Bass Institute at the University of South Australia

Opportunities in terms of new products that communications agencies can offer

  • Internal communications programme – site shutdown or company shutdown as a product
  • CSR audit as product
  • CRM (customer relationship management) audit as product

Focus on clients based on their strategic intent if they are implementing ZBB, here’s a quick guide I did earlier this year.

Businesses have six paths to growth
Zero-Based Budgeting

Path versus agency discipline
Zero-Based Budgeting

If your client programme lies in parts of the spectrum where you won’t benefit, then as an agency you have a few choices:

  • Identify and grow your business within other brands of a clients business
  • Look at rivals for opportunities
  • Treat the current business as a cash cow

A second aspect of risk analysis is brand consolidation. There is not much that an agency can do with the change in brand architecture like Coca-Cola. The clients are likely to cut costs.

A clearer source of risk will be ‘local gems’ this is a consumer brand that is only sold in one country (it may be known under a different name in other countries). These brands are likely to be closed down or sold on, particularly if they are in declining growth sectors such as margarine spreads, cereals or carbonated drinks.

If you have only started planning about looking for replacement brands in your portfolio, it may already be too late. Best case scenario is that the brand is bought by a local FMCG company.

Looking at previous brand sales like Radion washing powder as an example the acquirers will not support it with significant marketing spend. Instead, they will look to maximise their investment by mining existing brand loyalty and awareness.  Depending on the product category and the target audience will depend on how fast inevitable brand decline will be.

Either way it is not a particularly attractive piece of business or large or medium-sized agencies. An incumbent agency will have to repitch for the work as it will fall outside the purview of existing contracts and business relationships.

Advertising agencies have a head start in terms of their planners having a clear grip on what Sharp’s concept of smart mass marketing means for their discipline. PR agencies need to articulate this and reflect it in their account planning. They are still struggling to get to grips with social and are championing concepts like ‘micro-influencers’; that don’t fit into Sharp’s world view. They are effectively burning client respect.

PR agencies need to think much more in terms of programme audience reach and repetition for audiences, rather than the current focus on influence.

Pre Black Friday email marketing

I started receiving ‘Black Friday’ emails since the beginning of November. I eventually gave in and opened Apple’s email which arrived on the Tuesday morning.

Here’s what it looked like on mobile (iPhone 7 Plus)
Black Friday mobile email
Here is what it looked like on desktop email
Black Friday Desktop Email
Here is what the landing page looked like
Black Friday landing page

The call to action was to come back on Friday for great deals. There was a missed opportunity there was no reminder mechanism, no suggestion to bookmark the page and no way to build a list of things to purchase on the Friday.

Judging by the artwork, Apple wants the big push to be around the Apple Watch 2. Given the overall performance of smart watches as a sector this might be a bit ambitious, or indicate a supply chain imbalance in other product lines like the iPhone 7 and the new MacBook Pro?

If it was about lower price points, I would have thought that there would be more of a push on stocking fillers like the Airport Extreme or Apple TV to build buzz and store traffic?

The language was quite interesting

Our one-day shopping event will be here before you know it. Come back this Friday to tick everyone off your list

‘Tick everyone off’ in British English also means – annoy everyone or make them upset. Perhaps the copywriting could do with some finessing, given how that this is likely to be viewed at a glance if Apple is lucky by many consumers.

Thoughts on the new Apple MacBook Pro

Having slept a few naps contemplating Apple’s new MacBook Pro. I have been a Mac user since it was the mark of eccentricity. I am writing this post on a 13″ MacBook Pro and have a house of other Macs and peripherals.

Theatre
Apple launched a new range of Apple MacBook Pro’s on October 27, 2016. This was a day after Microsoft’s reinvigoration of its Surface franchise.  Apple ignores timing and tries to plough its own furrow. But comparisons by journalists and market analysts are inevitable.

Microsoft has done a very good job at presenting a device that owes its build quality to the schooling that Apple has given to the Shenzhen eco-system over the past two decades.

The focus on touch computing feels like a step on a roadmap to Minority Report style computing interfaces.  Microsoft has finally mastered the showmanship of Apple at its best.

Apple’s presentation trod a well-worn formula. Tim Cook acts as the ringmaster and provides a business update. Angela Ahrendts sits at a prominent place in the audience and appears on a few cut-in shots. Craig Federighi presented the first product setting a light self-depreciating humour with in-jokes that pull the Apple watchers through the fourth wall and draws them inside ‘Apple’. Eddy Cue plays a similar role for more content related products. In that respect they are interchangeable like pieces of Lego.

Phil Schiller came in to do the heavy lifting on the product. While the design had some points of interest including TouchID and the touchpad the ports on the machine are a major issue.

Given the Pro nature of the computer, Apple couldn’t completely hide behind ‘design’ like it has done with the MacBook. So Phil Schiller was given the job of doing the heavy lifting on the product introduction.

There was the usual Jonny Ive voiceover video on how the product was made with identikit superlatives from previous launches. It could almost be done by a bot with the voice of Jonny Ive, rather than disturbing his creative process.

It all felt like it was dialled in, there wasn’t the sense of occasion that Apple has managed in the past.

User experience
Many people have pointed out that Microsoft’s products looked more innovative and seemed to be actively courting the creatives that have been the core of Apple’s support. In reality much of it was smoke and mirrors. Yes Apple has lost some of the video market because its machines just aren’t powerful, in comparison to other workstations out there.

The touch interface is more of a red herring. Ever since the HP-150 – touch hasn’t played that well with desktop computers because content creators don’t like to take their hands too far from the keyboard when work. It ruins the flow if you can touch type; or have muscle memory for your PhotoShop shortcuts.

Apple didn’t invent the Surface Dial because it already had an equivalent made by Griffin Technology – the PowerMate. In fact the PowerMate had originally been available for Windows Vista and Linux as well, but for some reason the device software didn’t work well with Windows 7 & 8.

I can see why Apple has gravitated towards the touchpad instead. But it needed to do a better job telling the story.

Heat
Regardless of the wrong headedness of Microsoft’s announcements, the company has managed to get much of the heat that Apple used to bring to announcements. By comparison Apple ploughed exactly the same furrow as it has done for the past few years – the products themselves where interchangeable.

The design provided little enthusiasm amongst the creatives that I know, beyond agitation at the pointless port changes and inconvenience that conveyed.

While these people aren’t going to move to Microsoft, the Surface announcements provided them with a compare and contrast experience which agitated the situation further.  To quote one friend

Apple doesn’t know who it is. It doesn’t know its customers and it no longer understands professionals.

Design
Apple’s design of the MacBook Pro shows a good deal of myopia. Yes, Apple saved weight in the laptops; but that doesn’t mean that the consumer saves weight. The move to USB C only has had a huge impact. A raft of new dongles, SD card readers and adaptors required. If like me you present to external parties, you will have a Thunderbolt to VGA dongle.

With the new laptop, you will need a new VGA dongle, and a new HDMI dongle. I have £2,000 of Thunderbolt displays that will need some way of connecting to Apple’s new USB C port. I replace my displays less often than my laptop. We have even earlier displays in the office.

Every so often I transfer files on to a disk for clients with locked down IT systems. Their IT department don’t like file transfer services like WeTransfer or FTP. They don’t like shared drives from Google or Box. I will need a USB C to USB adaptor to make this happen. Even the encrypted USB thumb drive on my ‘real life’ key chain will require an adaptor!

I will be swimming in a sea of extra cables and parts that will weigh more than the 1/2 pound that Apple managed to save. Thank you for nothing, Apple.  Where interfaces have changed before there was a strong industry argument. Apple hit the curve at the right time for standards such as USB and dispensing with optical drives.

The move to USB C seems to be more about having a long thing slot instead of a slightly taller one. Getting rid of the MagSafe power connector has actually made the laptop less safe. MagSafe is a connector that is still superior to anything else on the market.  Apple has moved from an obsession with ‘form and function’ to ‘form over function’.

The problem is one of Apple’s own making: it has obsessed about size zero design since Steve Jobs used to have a Motorola RAZR.

Price versus Value
So despite coming with a half pound less mass and a lot of inconvenience, the devices come in at $200 more expensive than their predecessors. It will be harder for Apple customers to upgrade to this device unless their current machine is at least five years old. I don’t think that this laptop will provide the injection in shipments that Apple believes it will.

A quick word on displays
Apple’s move away from external displays was an interesting one. There can’t be that much engineering difference between building the iMac and the Apple Display? Yet Apple seems to have abandoned the market. It gives some professionals a natural break point to review whether they should stay with Apple. Apple displays aren’t only a product line but a visible ambassador of Apple’s brand where you can see the sea of displays in agencies and know that they are an Apple shop. It is the classic ‘Carol Bartz’ school of technology product management.

More information
Initial thoughts on Windows 8 | renaissance chambara
Size Zero Design | renaissance chambara
Why I am sunsetting Yahoo! | renaissance chambara
Apple just told the world it has no idea who the Mac is for – Charged Tech – Medium
Apple (AAPL) removed MagSafe, its safest, smartest invention ever, from the new MacBook Pros — Quartz
How Apple’s New MacBook Pros Compare To Microsoft’s New Surface Studio | Fast Company | Business + Innovation – a subtly cutting article on the new MacBook Pro
New MacBook Pro touches at why computers still matter for Apple | CNet
Apple’s new MacBook Pro kills off most of the ports you probably need | TechCrunch

Can Brexiters and Remoaners segmentation be part of a marketing strategy?

This chain of thought got fired up when my Facebook filled up with calls to petition British Airways to strop the distribution of the Daily Mail, mainly because of headlines like:
mail headline
There are at least 16 million consumers that would broadly fit within the headline. When one looks at the demographic split of leave versus remain voters you start to see clear segmentation ideal for marketing opportunity.

You already have brands doing this in the U.S. for instance standing up for LGBT rights. Unilever’s Ben & Jerry’s have come out in support of Black Lives Matter.

Now lets look at research done into the demographics of the voters.

Much has been made of the splits in UK society:

Young people who voted tended toward Remain; the older you were the more likely you would be a Brexiter

(73%) of 18 to 24 year-olds voted to remain…

A majority of those aged over 45 voted to leave, rising to 60% of those aged 65 or over

Working class areas outside London and other major cities voted to leave

The AB social group (broadly speaking, professionals and managers) were the only social group among whom a majority voted to remain (57%). C1s divided fairly evenly; nearly two thirds of C2DEs (64%) voted to leave the EU

Labour claimed that a majority of Labour supporters who voted voted remain

Nearly two thirds of Labour and SNP voters (63% and 64%), seven in ten Liberal Democrats and three quarters of Greens, voted to remain

The correlation between class and voting broke down in Scotland and Northern Ireland were working class areas outside major cities narrowly voted to stay.

Some of it was certainly a protest vote, large swathes of the country feel that they have been ignored by a professional city-orientated political class. As the Political Economy Research Centre reflected:

The geography of leave voters reflected the economic crisis of the 1970s, not the 2010s.

Concerns about financial future and family’s well being were stressors rather than root causes. Research attributed it to more deep seated attitudes that shaped world view.

Work by the London School of Economics showed that when  attitudes were mapped against income level; working class status wasn’t as much a deciding factor as pollsters would have had one believe, instead it seemed to correlate close to personality traits.

Closedness and openess

Back in the 1950s American academics sought to answer the question of how Hitler and Mussolini  could have become so popular in what were initially democratic societies? What they and subsequent research found was that a certain amount of  a given population tend to have more of a closedness (or authoritarian dynamic) in their world view.

This can be amplified through:

  • Culture
  • Fear
  • Change
  • Economic insecurity

They look for strong leaders and simple answers. Nostalgia and the past is reassuring. They are less interested in ‘sensation seeking’ and want to fit in.

Liberal values tended to be more orientated towards aspects of openness that embrace newness, sensations, innovation and change.

The Google Trends spike

Much was made of a post-election Google Trends spike on searches such as ‘What is Brexit?’ as a demonstration of a key democracy failing. According to political scientists voters having an understanding of what they are voting for is key in a democracy. If it were true it would cast a shadow on the likelihood of the underlying electorate traits being useful for segmentation. The Google Trends story wasn’t necessarily correct; (but it was great fodder for the news cycle)

  • Google Trends is about the rate of change in searches, so it might be moved dramatically by a relatively small amount of searches
  • Having been working on using Google Trends, we’ve found that there are inconsistencies in data in terms of timing and peaks depending on which IP address it is drawn from and what is the exact mix of terms compared.
  • There is nothing but a hypothesis to associate the peak with people who were eligible to vote.

National versus international businesses

There are a number of British brands on the high street that are geographically focused for whom taking a resolute Brexit stamp would not cause brand harm or investor protest. Examples of this would be Tesco – who have pared back their international footprint and are likely to continue to do so, Wetherspoons, Poundstretcher and payday loans brands like Wonga.com.

For more internationally orientated publicly listed companies, the UK becomes less attractive. Senior government thought leaders such as conservative MP John Redwood have made it clear ‘interference’ including voicing concerns about the Brexit process would be unwelcome.

…companies who did not stay silent on the country’s EU membership would pay a “very dear economic and financial price”.

Chief executives who decide to take a corporate position on the issue could lose their jobs while those campaigning against membership would ensure there were financial consequences…

As the UK becomes a more isolated economy  two steps behind its European peers there could be a temptation to spin off their UK business. This could happen in two ways.

Selling on local gem brands (brands with only significant sales in the local country). Examples could be brands like:

  • Ambrosia
  • Hovis
  • Cabrini sportswear
  • K cider
  • Barclays
  • Wonga.com
  • Royal London

Alternatively disposing of UK subsidiaries would make sense as Brexit represents a permanent reduction reduction in profit margins. For someone like McDonald’s Restaurants, that would likely mean pressing ahead with an ‘all-franchise’ model in a similar approach to what it has taken recently in China.

In order to sell they are likely to require some sort of assets rather than just a sales agreement with the parent company. If they have become only a UK sales organisation, then the viability of this approach depends on the supply chain. One way of adding value into the supply chain would be for these businesses to open up a direct sales channel.

Companies like Unilever already look at how they can integrate into supermarkets supply chain, with ‘buy it now’ buttons on their own site that take you to their online retail partners. They could also open up a direct e-commerce channel; given the Marmitegate debacle with Tesco; expect examination of alternative business models like America’s Dollar Shave Club and Amazon’s Dash.

Modern international brands are already used to marketing towards the ‘open consumer’ who was likely to vote remain. Products that feel up to date, innovative and socially responsible.  A classic example would be Dove, Innocent smoothies, AirBnB or the average family car.

Marketing to the Brexiter

A local business for local people with brands that appeal to leave voter demographics could be more explicit in courting leave voter’s spend.

Tapping into the ‘authoritarian outlook’ would mean tapping into nostalgia; throw-back branding and possibly rolling back political correctness in the name of common sense.

An extreme outcome could be Robertsons bringing back their original Golly character; though thankfully I suspect that would be step too far – even in post-Brexit Britain.
The Robertson's golly

Rejection of expert is partly down to wanting a reduction in complexity. This has huge implications for a wide range of products, particularly in the financial services sector or mobile tariffs.

Choice is the enemy, a simple product, down-to-earth, unambiguous in its claims. Mobile tariffs without bolt-on features, complex phone upgrade cycles or value-added services. In the case of pensions and insurance, with the assurance that they could help ward off a sinister future full of negative change rather than rich rewards. Perceived good value wouldn’t do any harm either.

In terms of how the product or service fits into the Brexiter’s life it is less about being part of a creative expression of individuality. Instead it is more about the ‘grey man’; blending in. Blending in is a threat coping mechanism, a form of risk reduction (think Dilbert cartoons). It shouldn’t mistaken for being more community-spirited, instead the community is of mutual convenience – a shoal of people.  A consequence of this is that persona creation becomes harder or derivative, the stellar insight from the planner loses its gloss. Agency creatives are likely to struggle with consumer empathy beyond utility.

From the advertisers perspective; blunt simplicity rather than clever creative. Audience reach is still important, but a higher frequency is likely required to achieve a comparable impact. This is to get over the Brexiter’s higher degree of inertia to marketing and making them feel that accepting the brand is part of conforming within society. It is part of the eco-system, traditional brands have an advantage due to their familiarity and heritage. Even if its a new brand it feels as if it has always been part of the consumers fabric.

More information
Ben & Jerry’s came out in support of Black Lives Matter. Naturally, some cops are freaking out | Fusion
Business Leaders Speak Out Against North Carolina’s Transgender Law | Wall Street Journal
These 70 Corporations Want to Block North Carolina’s Transgender Bathroom Law | CBN News (US news outlet for the evangelical christian audience)
How the United Kingdom voted on Thursday… and why | Lord Ashcroft Polls
How Demographics Decided Brexit | The Market Oracle
How has Brexit changed the mindset of a nation? | Bucks New University Business School
How do Britain’s ethnic minorities view the EU referendum? | Kings College London
Making Sense of Brexit – the data you need to analyse | UK Data Service
Who is voting to leave the EU and why? | openDemocracy UK
Thoughts on the sociology of Brexit | Political Economy Research Centre
The 2016 Referendum, Brexit and the Left Behind: An Aggregate-Level Analysis of the Result by Goodwin and Heath – PDF
Businesses that speak out for Britain’s EU membership will be punished, vows John Redwood | The Telegraph
UK voters don’t understand Brexit, Google searches suggest | Ars Technica UK
Marmitegate is ‘just the tip of the iceberg’ as cheese, chocolate and wine all face ‘punishing tariffs’, Nick Clegg claims | The Telegraph
It’s NOT the economy, stupid: Brexit as a story of personal values | British Politics and Policy blog | LSE
Brexiters would rather trust the wisdom of ordinary people than the opinion of experts | Quartz
The One Weird Trait That Predicts Whether You’re a Trump Supporter | Politico
Brexit Voters: NOT the Left Behind | Fabian Society
Authoritarianism and Political Behavior by Janowitz & Marvick | Public Opinion Quarterly (Summer 1953)
Voters’ personality traits in presidential elections by Barbaranelli, Caprara, Vecchione and Fraley | Personality and Individual Differences 42 (2007) – PDF document
Personality Traits, Partisan Attitudes, and Voting Behavior. Evidence from Germany by Schoen | Political Psychology (August 2007) – PDF document
Grey Man Strategies 101: Peeling Away the Thin Veneer of Society | Imminent Threat Solutions
How To: The Modern Grey Man Philosophy | Loaded Pocketz
EU referendum results | The Electoral Commission

According to Google, PR and SEO are no longer earned media-only disciplines

Back in August Google started to roll out changes to its Keyword Planner tool. Users who did not have an active AdWords campaign running on there account would no longer get search volume data. Instead an indicative range appeared.
Crippled version of Google Keyword Planner
Information that isn’t particularly useful.

Search volume as a directional metric is important for both online and offline communications:

  • Public relations and branding specialists to understand the language of the customer. PRs would use it to help hone key messages. Branding specialists would use it to help the brand lexicon or editorial guide
  • SEO specialists use this information as part of their process to pick the most important key words for a web page or website

Now PR people and branding specialists need to have access to an account with a continuous advertising spend running. Even if they aren’t doing any online-related work themselves.

The road to paid media only access has been a long one: KeyWord Planner had been announced in 2013, a result of Google rationalising some of the existing tools into one. Keyword Tool and Traffic estimator merged. KeyWord Planner was notable for requiring an AdWords account, this was a noticeable change and not too subtle hint from Google.

Unlike other product changes this latest ‘enhancement’ was not announced on any of the Google product blogs like Inside AdWords, but instead was acknowledged retrospectively by a Google spokesperson answering a question from Search Engine Land. It has been up to the community to explore the full implications.

One aspect is that if you reduce your Google advertising spend, you lose access to the data. So, PR, branding and SEO become inextricably linked with PPC advertising.  Critics could accuse Google of abusing its market power with 95%+ share of search in Europe; but Google would argue that it has had to move this way because of bad actors. Secondly, since the service had been provided for free since it was launched at the end of 2008, there is never any guarantee that it would be free to use.

Google now has antitrust investigations coming at it in markets around the world, they probably just don’t care any more and its all about profit maximisation. If one looks at the Alphabet Group overall, Google is the obvious cash cow.

However it is ironic now that Russian search engine Yandex via its Wordstat tool provides better free information on search volumes than Google.

More information
What the heck is going on with Google Keyword Planner? | Search Engine Journal
Introducing Keyword Planner: combining the Keyword Tool and Traffic Estimator into One | Google Inside AdWords blog
Announcing the Search-based Keyword Tool | Google Inside AdWords blog
Yandex Wordstat

Modern PR impact and consequences

Jessica Lessin wrote a great piece in The Information about her perspective as a journalist on how the practice of (tech) PR had changed (at least in Silicon Valley). The New PR Reality and What it Means outlines a number of traits emblematic of modern PR:

  • Press release as op ed piece on corporate or executive blog to promote one “story of record” about whatever you want to announce
  • Lessin considered exclusives with a friendly publication to be another variant of the same strategy
  • Lessin laments the demise of the press conference and the access that it brings to corporate executives for journalists.

Lessin also warns that the lack of information and dialogue reduces the variations and reflections on would see on the story in terms of analysis. The audience needs to have a greater capacity for critical thinking and a certain amount of cynicism to ask why?

The silicon valley bubble

Lessin and peers like Kara Swisher got to see an industry mature over time. They were in the right part of the world to build face-to-face relationships with the people that mattered.

The reality for journalists outside the Silicon Valley area was generally less access. 80 percent of the time when I arranged media access to my clients it was a ‘down-the-line’ telephone interview.

As an outsider who has had the opportunity observe public relations and media relationships in silicon valley I was surprised by the cordial differential aspect of it. There generally aren’t that many challenges, dissenting voices are usually shrill and stifled through a lack of access. The classic examples of this are Apple’s relationship with The Register, the 2009 blacklist of CNet by Google over Eric Schmidt’s opinions on privacy or Peter Thiel’s role in putting Gawker Media out of business.

This constriction of debate and access the Lessin cared about is in keeping with wider trend of silicon valley hubris and ego.

The reasons why public relations has changed

In the late 1990s through to the early 2000s the mass media was the best way to talk to the end consumer. Through advertising and PR. PR had a relatively low cost barrier to entry, but was relatively inefficient from a cost-per-reach and campaign impact point of view.

Online advertising offered new dynamics that changed the way marketing money was spent. This meant that you had to do more with  a static or declining marketing spend, this had a number of follow on factors:

  • Less budget for out-of-pocket expenses. The first agency I worked in launched Hitachi Data System’s Skyline Trillium range of IBM-compatiable mainframes. (I know, I know you want to sleep). We took a whole pile of journalists on a helicopter flight over London’s financial district as part of the launch, so they could see the iconic skyline (I know, grown at the crushingly twee creative concept). You just wouldn’t do that now.  There isn’t the money for decent gift bags or cleverly presented press packs either
  • Mid-and-senior agency staff salaries have been static for at least the past decade, which affects the quality of the thinking and the work done

There was also a corresponding change in the way PR was done in order to improve campaign impact. It used to be that you made a big bang  and hoped that the deluge of coverage would provide a 360 experience of sufficient reach, frequency and impact that client commercial goals would be achieved.

That theory fell down. Not only had PR spend changed but publication advertising spend had changed as well. There were less publications and less journalists writing for them. Those that wrote for the publications had to write more content.

That mean’t more time writing, less time research, thinking and networking. Less time to turn up at press conferences. Press conferences became a relatively high risk tactic for the agency PR to recommend; unless you had a landmark event.

What if you throw a press conference and few people show up or don’t stick around. Angela Eagle’s disastrous launch of her campaign to become leader of the UK Labour Party is a case in point.

Through little fault of Eagle’s campaign team, the Conservative leadership competition collapsed leaving Teresa May as prime minster. Eagle ended up with a poorly attended press conference with few questions from the media. Now imagine if a similar scenario happened to a Silicon Valley leader like Larry Ellison.

From an agency perspective this ‘journalist scarcity’ became a catalyst to change the approach to try and drive greater impact of coverage generated. It’s what agencies call ‘story-telling’; you work with a publication to craft all the right conditions including executive access – so that a story will run.

Working with a large corporate means that this takes a lot of time:

  • Building the story first of all, this is your product that you then reverse-engineer the journalist ‘journey’ through. It takes into account areas of interest that they journalist has previously written about, the publication style. The likely word count (a bigger canvas is better)
  • You pitch this to the client. This would include a complete plan including what you hope to get from the publication (likely headlines and synopsis), how this rolls up to business objectives
  • The pitching process to the journalist is a high touch process. The journey that they are taken on might take months based on executive and resource availability (such as lab tours)

With one agency client I worked with, my back-of-a-cigarette-packet maths had some disturbing numbers. Placing a story in the Wall Street Journal cost roughly the same as buying a full page of ad space.

Secondly stories need heroes: people. Bill Gates was framed as a superman – which was torn to shreds in the Judge Jackson anti-trust trial testimonial videos. A more cynical interpretation of the Bill and Melinda Gates Foundation would be having at least some role in rehabilitating Gates’ profile as a statesman of the technology sector.

Many of the heroes are drawn from the bench below the CEO; Microsoft used former research head Rick Rashid in that role for a number of years. Google had highlighted Marissa Mayer in a similar role – neither executive now work for those employers.

So how do you make the storytelling process develop greater agility and  become more  scaleable to improve campaign impact and frequency? Social media offered part of the answer for prominent technology companies. Corporate channels became de rigour and new media channels like The Verge and Buzzfeed news sprang up.  The technology sector even bankrolled some of these titles, notably Sarah Lacy’s Pando.

Hubspot have turned this into an industry as this approach is emblematic of the content marketing methods and tools they sell to businesses around the world. Codifying the PR techniques of silicon valley for a wider audience.

More information
The New PR Reality and What it Means | The Information (paywall)
Hitachi (finally) releases Skyline Trinium Nine high-end mainframe | ComputerWorld

Fixing email the Apple way

Despite millennials and social networks email is still the killer app of the web. But all is not good with email. I look at friends home screens and see thousands of unread emails in their inbox. They use search to find what they need.
Email bankruptcy
It gives me heart palpitations just looking at the photo above. It was apparent for years that something needed to be done for email. Identity for e-commerce and social platforms still hinges on email addresses. For networks like Quora and LinkedIn, much of your interaction is driven in response to email prompts.

Email is a mature technology that works across a range of platforms and generally does a good job. It’s searchable, it has a permanence. Alongside the address book app, its a database to many aspects of your life from concert tickets, friend’s news or interaction with the government.

There has been a renaissance in quality email newsletters such as Azeem’s The Exponential View or The Hustle. Email marketing continues to be an effective marketing channel for e-commerce businesses.

Apple’s iOS 10 and MacOS Sierra have tweaked the email experience on their default mail.app.
Ios10
Apple has managed to detect the unsubscribe function in many email newsletters and give users control over their subscription at the top of each email.

Using the beta version of Sierra and iOS10 I found that I unsubscribed from many marketing emails. This seems to hold out in some of the anecdotal feedback I’ve heard from friends as email campaigns have reported a surge in unsubscribes since it rolled out from beta to general availability. This has been the same on both b2b and b2c clients.

However many of these people will be unengaged subscribers who hadn’t gained sufficient momentum to cancel without Apple’s assistance. Google takes a different approach, Gmail masks these emails in a separate folder – out of sight, out of mind.

A second part of this was that I found I was prepared to take a chance on new interesting newsletter subscriptions. The content that I did have, I engaged with more because it was easier to get rid of meh content.

I think this is an exciting development, it is a palette cleanser, an opportunity for email marketers to raise the quality of content and engagement. An opportunity to get direct immediate feedback through subscriptions and cancellations. A confident email reading consumers is a fantastic opportunity for agencies and progressive clients. However this will only happen if they chose to look beyond the dip.

Running programmatic creative is hard

This is the advert served up by Web Summit in my feed today. Web Summit are famous for their use of data analysis to drive everything from advertising to seating arrangements, you can read more about the how on a blog post that I have linked to in more information at the bottom.
Web Summit ad targeting
I presume that I have been targeted with the ad because of my connections given the relatively sparse amount of data in my profile and posts (most of them are published by a bot based on NASA content).

Given that I work in digital, the targeting seems pretty good so far – I am not British, but lets overlook that for a moment.  Instead look at the creative headline and the image below. It immediately created a dissonant feeling for me. There was no 29 images. At least half the people featured are Americans despite the ‘Meet 29 British going to Web Summit in Lisbon this November‘.

Finally 29 British attendees out of a list of 30,000 sounds a really small proportion for an event held in Lisbon – with the content delivered in English. This copy reduces any ‘social proof’ that the ad may have it in trying to get me to attend.

Data is great at creative targeting, particularly through seeing network patterns which otherwise wouldn’t be apparent. Where it tends to fall down is in creative utilising the data.

More information
Engineering Serendipity: The Story of Web Summit’s Growth | Web Summit Blog

Technology companies, we have to talk about China

Uber has been cited as an example of how US technology companies can’t succeed in China, but the wrong lessons are being learned. Let’s look at a couple of examples.

Facebook

Facebook is viewed as having ‘failed’ in China. There are two parts to this. First of all lets talk about Facebook’s business model, simply put it monetises consumers attention by selling advertising and related services to businesses.  In order to get consumers in a relevant market, it has to comply with local laws. In the EU it has a relatively easy ride as it is policed by the Irish government for compliance with EU regulations.

China has taken much more of hands on regulatory approach to the internet, like all media. Much of this is down to keeping a ‘harmonious’ society. You might not like the way they do it, but the party views internal pressures in a similar way to Western views on terrorism. Whether that terrorism in the name of Islam or black bloc anarchists.

China has an extensive censorship mechanism, it is a part of doing business there. Whilst the content maybe different, it is similar to the censorship structure for the UK in many respects:

  • Government steered industry practice
  • Legislation

One of the big differences in the UK is site blocking to protect commercial rather than government interests such as sporting event rights. Facebook chose not to implement systems that would make it compliant in China – so it isn’t available to ordinary Chinese consumers. Facebook does sell advertising in China to companies who want to reach western consumers. It has been successful in its advertising sales, sometimes to the detriment of western consumers. State-owned enterprise (SOE) Air China features as a case study for Facebook’s advertising business. San Francisco-based Papaya Mobile has built a successful business providing an online portal that allows Chinese businesses to target Facebook users abroad. I’d argue that Facebook isn’t failing in China.

If Facebook wanted to get Chinese consumers on board it had three market entry routes:

  • Build a separate Chinese product. This is something that US companies generally don’t do, they may localise the product but they avoid forking the product
  • Build infrastructure that complies with Chinese regulations. Google had done this in the past, before they chose not to
  • Have a local partner do the relevant work. Skype successfully entered the Chinese market with Chinese partner TOM. The Chinese client of Skype is known to allow government listening and weaker encryption. But in a post-Snowden world that shouldn’t be too surprising, the Chinese lack the subtlety of other countries security apparatus in their implementation but the goals are similar

Facebook somewhere along the line decided that they didn’t want to enter the Chinese market for consumers as is; but may do in the future if market dynamics change.

It is notable that Facebook’s growth in both Korea and Japan was slower than comparable western countries. Local platforms addressed the market better (KakaoTalk) and social norms of ‘nick name’ identities allowed to Twitter to become a comparative success in Japan.

Google

Google had entered China in 2005. They hired a local executive to run the business who had previously worked at Microsoft. Four years later they were third in the market behind local firms Baidu and Soso (Tencent subsidiary). Google had an estimated 29% market share.

So Google was in third place before it had legal issues in China. Why was it in third place? Google is thought to have under-estimated the growth rate in terms of number of web pages of the Chinese internet. In the same way that Yahoo! and Bing under-indexed the western web and paid for it by losing market share to Google, Google lost out to Baidu. This was about localisation and agility rather than the system being gamed against it. Google hasn’t indexed non-Roman languages as well as English, French etc.

Google was particularly beloved of those Chinese who had a more international life; scientific researchers, journalists, bankers, marketers and the more cosmopolitan members of the middle class. But for the average Chinese consumer, other search engines did a better job.

Google services ran into trouble with a YouTube video showing security forces and protestors in Tibet. Google took action in the Chinese market when Chinese dissidents had their Gmail accounts hacked. Again in a post-Snowden world this isn’t the shocking scandal it would have once been. Complaints in the US together with this incident meant that Google was prepared to give up on Chinese consumers. The business still has an R&D team in China and works with manufacturers on Android.

So why do American companies succeed elsewhere?

The simple answer is one of scale. The US is a single country with largely the same regulatory framework, a single language, good infrastructure and access to large amounts of capital. It is a market for approximately 324 million people. This allows businesses to grow rapidly to a scale that is internationally competitive.

By comparison although the EU has an addressable population of just over 510 million people, you have different legal systems (though it is becoming more harmonised by the EU). You have 24 languages, a common currency but diverse banking systems.

This comparative lack of scale in EU technology start-ups has two effects:

  • They are harder to grow as there isn’t a comparable domestic market to incubate businesses. If they do grow, the better access of capital allows an EU start-up to be bought out. Look at last.fm, DeepMind or ARM as examples of this.  Some businesses have managed to break like Spotify as they tapped into US funding. It is also pertinent to point out that Spotify isn’t make money
  • With some noticeable exceptions like Spotify, getting capital to grow a business internationally is much harder. It isn’t realistic for a European start-up to pursue the Amazon / Uber model of betting against competition by assuming that they will always have access to cheap plentiful capital

This has meant that Facebook, Google and the like have risen largely unopposed in Europe. They have found it so easy that they’ve gained monopoly levels of market share. This is unlikely to change anytime soon. At best Europe acts like a ‘feeder team’ of talent and IP to US start-ups. Where Europe is successful is largely based on past dominance in legacy industry sectors like vehicle manufacture and pharmaceuticals. This also partly explains Europe’s stagnant growth.

China is different

China is the polar opposite of Europe. It has an addressable market for 1.4 billion people. Whilst there are many dialects in China the party railroaded Mandarin as the lingua franca and simplified Chinese as a common written language.  Live and incomes in the tier one cities would be comparable to parts of Europe. Economic growth has slowed to 6 per cent a year, but the economy is still flush with capital.

A huge population means a huge pool of qualified staff. You combine this with a large amount of capital and you have a business than can out-Uber Uber.

The culture of China is different. Chinese consumers like to go to Starbucks and KFC, use Apple products and wear luxury fashion brands; but only because these fit into Chinese cultural constructs. That means that products need to be optimised for the local market.

China has been through huge change since the rise of the party, which means that the owner executives of these companies have have a greater desire for risk to capitalise on ‘the now’.

This means that most of the advantages Silicon Valley has: agility of action, talent and capital are negated in their competition in China. In addition, since they committed to an approach that already works, adaptation to local market needs are limited. This is interpreted by the Chinese counterparts as hubris; the reality is more subtle.

China does have strategic interests which means that it regulates ‘state secrets’ very carefully. Mapping technology is carefully controlled. It has tried to use its size to benefit its businesses. In the same way that the EU through ETSI defined the GSM standard, the Chinese government tried to do the same with TD-CDMA. The reality is that favoured companies like Huawei have managed to allow their clients to get cheap funding for purchases via Chinese state-owned banks.

Like the US government, the Chinese government uses research funding and infrastructure spending to direct some aspects of technological development. Since the administration of Hu Jintao, the Internet of Things (IoT) has been a government focus.

The danger of the invincible China myth

Whilst China wants to have a world-beating successful technology sector. There are problems that comes with a perception of invisibility, China will find it hard to keep open markets. Trade negotiations will become intractable as the other party sees no upsides to working with China. An eco-system where foreigners have a modicum of success is a better outcome for the Chinese government.

Uber’s problems were entirely of their own making, their choice to go into China was likely their first error. Not because it is excessively gained against them, but because they didn’t have any comparative advantages over Didi.

More information
Uber has destroyed the Western myth that companies can grow huge in China without being Chinese
Content filtering by UK ISPs | Open Rights Group Wiki
Facebook “Will Do Everything We Can” To Address Shady Dress Retailers | Buzzfeed News
Facebook for Business | Air China
Papaya Shoptimize | Papaya Mobile
China listening in on Skype – Microsoft assumes you approve | GreatFire.org
Spotify financial results show struggle to make streaming music profitable – The Guardian

The QRcode post

A few years ago, I was involved in a project that used QRcodes on OOH (out of home) activity for a retail launch. QRcode scanners varied in performance. In addition you had to think about:

  • Contrast – did the QRcode stand out?
  • Relative aspect – would it be too big or too small for the audience to scan?

In the UK, QRcodes are seen by marketers as old hat (but then they didn’t ‘get’ them in the same way that Asia did). Other people don’t really understand how to use them.
QRcode 101
Above is the picture of the local cafe around the corner from my office. The QRcode is too disjointed and blurred to read. I asked a member of staff about it and he told me that he thought it was some type of logo…

Benetton’s new positioning

For me Benetton was a brand of the 1980s and early 1990s. It was a family run business that pioneered the use of technology to automate clothing manufacturing in the face of globalisation. It has a famous series of adverts that provided progressive social commentary through shock tactics.
Benetton new positioning
It’s new positioning is a marked move away from this heritage. It’s ‘Clothes for Humans’ tag line moves the brand towards the everyday – almost norm core in its message. It positions the brands as clothes for everyone – more Uniqlo or Gap than designer wear.