Search results for: “Byron Sharp”

Cannes and VidCon outtakes
Cannes and VidCon – I had the chance to read around a lot of the stuff around the events and listened to Ogilvy’s webinar. Here were the key things that struck me.

There is blind faith amongst brand about the benefits of influencers and social. I find this particularly interesting because it represents a number of challenges to the status quo:
- This first struck me when I saw Heather Mitchell on a panel at the In2 Innovation Summit in May. Mitchell works in Unilever’s haircare division where she is director, head of global PR, digital engagement and entertainment marketing. I asked the panel about the impact of zero-based budgeting (ZBB) and the answer was ducked. ZBB requires a particular ROI on activity, something that (even paid for) influence marketing still struggles to do well
- The default ethos for most brand marketers is Byron Sharp’s How Brands Grow: What Marketers Don’t Know. Most consumer brands are in mature categories, engagement is unimportant; being top of mind (reach and repetition) is what matters
- Brands were looking to directly engage with influencers at VidCon with trade stands and giveaways at the expo. This was brands like Dove. Again, I’d wonder about the targeting and ROI
Substitute ‘buzz marketing’ for ‘influencer marketing’ and this could be 15 years ago. Don’t get me wrong I had great fun doing things like hijacking Harry Potter book launches when I worked at Yahoo!, but no idea how it really impacted brand or delivered in terms of RoI. Influencer marketing seems to be in a similar place.

Publicis and Marcel. Well it certainly got them noticed. There has been obligatory trolling (some of which was very funny). I tried to make a sombre look at it here: Thinking About Marcel (its about a nine minute read) – TL;DR version – its a huge challenge that Publicis has set itself. One interesting aspect to point out is the differing view point between WPP and Publicis. WPP has spent a lot of time, effort and money into building a complete advertising technology stack including advanced programmatic platforms and analytics.

WPP hoped that this would provide them with an unassailable competitive advantage. The challenge is that the bulk of growth in online spend is going to Facebook and Google – who also happen to have substantive advertising technology stacks.

I can’t help but wonder if this shaping is Publicis’ top line thinking? Scott Galloway posted a very sombre chart about this. If Google and Facebook hit their combined revenue targets this year, it will have a dramatic effect on the number of people employed in the major advertising groups.

To put Galloway’s numbers into context, the projected number of jobs lost in the advertising industry this year would be roughly the equivalent of every man and woman around the world currently employed at vehicle maker Nissan. And that’s just 2017.

If you paid attention to the Marcel concept film you would have noticed that the client service director is partly displaced when a client uses Marcel to directly reach out to Publicis experts.

If Marcel, just makes information easier to access internally; it could save the equivalent time equating to almost 1,600 employees (out of Publicis’s current 80,000 around the world).

People equate to billings as these marketing conglomerates are basically body shops in the way they operate. So it will adversely affect the value of the major marketing groups.

If that isn’t grim enough, Galloway doesn’t even bother to take into account the Chinese ecosystems which is digitising at a faster rate than the West. China also has a longer history of platforms and clients being directly connected – cutting out the media agency.

These changes in the advertising eco-system has huge implications about the erosion in brand equity over time. Amazon’s move to surpass other retailers also is about the erosion of brand power. Combine this with the increasing ubiquity of Prime and all brands start to look the same as private labels.

Thankfully the disciples of Byron Sharp still realise that there is power (and lower CPMs) in using television as a mass-advertising medium which is why FMCG product still spend 90% of their budget offline.

The best thing IPG, WPP, Omnicom and Publicis could do right now is spend a lot of money ensuring that every marketing and MBA student have copies of Mr Sharp’s books. If they haven’t been translated into Chinese, that might be an idea as well.

SnapChat is in its difficult ‘second album’ phase. Back when music came on physical media and record labels invested in developing artists as a longer term proposition than a reality TV series there was the ‘second album’ phase. Artists often struggled to bottle the lightning that gave them a successful first album. They usually had the money and resources to throw at it, but it was hard to be a consistent performer.

For example Bruce Springsteen only really became successful in the U.S. with his third album Born To Run – that level of record label support wouldn’t happen now.

On one level SnapChat has matured. It had a big presence at Cannes and its Snap glasses displaced VR technology as the worn product. It has been under assault. Major content providers like the BBC are choosing Instagram’s stories over SnapChat’s offerings. Even Twitter is getting back in the picture. Ogilvy’s team at VidCon talked about how Twitter had been successfully engaging with influencers and offering them support and attractive content monetisation offers.

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July 6, 2017
Richard Edelman is wrong, PR isn’t at a crossroads…
I recommend that readers check out Richard’s PR is at a Crossroads post. Edelman cites changes at PR agencies owned by marketing conglomerates as indicators. He thinks this due to a lack of confidence in the PR industry. There may be some truth in it; 2016 had the lowest annual growth in seven years for Edelman. As PR is at a crossroads, on the cusp of transformation? No, it is already being transformed.

Public relations has already crossed the Rubicon. The Rubicon crossing happened years ago. Richard noticed the signs back in April 2011:

…as PR continues to expand, encompassing digital, research, media planning and content creation, should we consider rebranding ourselves as communications firms?

At the time the question was prompted from London colleagues. Richard disagreed with the premise.

By 2012 Edelman was in the AdAge Agency A-list in the US. In March 2015, Edelman’s boiler plate changed from:

Edelman is the world’s largest public relations firm…

to

Edelman is a leading global communications marketing firm

Edelman hasn’t been a PR agency for the past 2-5 years. The transformation in the industry has been going on for at least a decade.

Why this has happened is down to six factors:
- Mature research and academic thinking on effective marketing
- Technology-driven marketing strategy
- CMO perspectives shaped by marketing thinking
- Talent
- Advertising changes
- Media landscape changes
Mature research and academic thinking on effective marketing

Lets break things down a bit, some bits of PR are about the corporate parts of a company.
Corporate PR covers a large area including:
- Public affairs
- Educating investors
- Shoring up shareholder confidence
- Internal communications
- Community affairs
Some corporate and social responsibility actitivities could fall under PR. When we’re talking about who is responsible for organisation moral purpose /meaning. This should come from the CEO down.

Thinking about marketing communications the situation changes a lot. It depends on the sector and the audience that you are communicating to. For consumer marketing; the role that PR plays as part is a subordinated part with the marketing mix. Byron Sharp’s works How Brands Grow (parts 1&2) outline PR’s small, but intricate role with clarity.

For mature consumer brands, engagement (and by extension PR) is less important. Instead the focus would be on efficient reach and frequency of repetition. Being top of mind is more important. The only way for marketing communications-orientated PR teams to grow their billings is service expansion.

Technology-driven marketing strategy

Many business-to-business marketers are using content marketing as a key channel. The content shaped by analysis from marketing automation software.

In marketing automation, strategy is outsourced. Rules embedded in the software platform dictate approach. PR becomes a source of content to feed the machine. The idea is to determine an effective approach. Then optimise to reduce the price of engagement over time. I could write a blog post or two about the problems with this approach, but it is tangental to PR. Content creation is an opportunity for PRs, all be it one with perpetually squeezed margins.

Mature research and academic thinking on effective marketing

In B2C marketing there are large research projects on what works. These include Ehrenberg-Bass Institute and the IPA. In marketing mature consumer brands, we know that reach, frequency and recency matters. Engagement is less important. Public relations then becomes an afterthought at best. Taking an integrated media planning led approach makes sense.

There isn’t a comparable set of research for the PR industry like IPA or Ehrenberg-Bass. Outside the US public relations generally doesn’t have budgets for tools and data. Clients tend to be more action-orientated. Media agencies tend to have the best insights – which aids planning and creative.

The benefits of an integrated advertising-led approach goes back decades. Edelman cites Y&R’s ‘whole egg’ concept. Dentsu’s ‘Cross Switch Marketing’ is similar with roots going back to the 1960s. The PR industry mistook integrated thinking for a primitive view of PR practice. The reality lies somewhere between communications myopia and macro marketing thinking.

From a CMO perspective
- PR spend is a small part of their budget. It may not even sit in their budget if there is a CCO (chief communications officer) role in the company
- PR isn’t supported by good quality secondary insights like the IPA or Ehrenberg-Bass
- Advertising works
- Advertising agencies foster high trust through visualisation of ideas backed by insights
- Media relations is low cost, low efficiency but can be high engagement
- Integrated simplifies the client/ agency dynamic (one ass to kick)
- Successful integrated agency engagements. Examples include Red Fuse (Colgate), GTB (Ford, Purina) and TBWA Media Arts Lab (Apple)
- The memory of Enfatico has disappeared
Talent

Edelman has done a better job than most agencies in getting digital and paid media talent. I’ve worked as an in-house marketer. I have worked as a PR person. I’ve also worked in PR agencies doing digital and paid media. I now work as a strategy director in a creative ad agency and the difference is huge.

For most specialists working in a PR agency can be thankless task:
- PR agency leaders don’t get other disciplines. This is particularly true outside North America
- I’ve worked with too many agency leaders who think digital is an infographic or a video
- The briefing process in PR agencies is awful. ‘We’ve got a video, make it viral’ was the worst brief I had
- Outside North America budgets are very tight
- You can get better working conditions elsewhere. Tools, people you can learn from, research and ambience. Real conversation at a PR agency: “can you wear a shirt and suit?” “Why?” “We’d just like it” “Can I quadruple my day rate?” “No, why?” “That’s my inconvenience of wearing a suit fee”
- PR agencies don’t win the awards that matter to us. PR publications wring their hands about the lack of PR wins at the Cannes Lions. This matters for your career
If you have capability built up in the ad agency, creative shop or media agency; use it. Publicis, WPP and Interpublic have deep expertise they can draw on. Publicis talks about this as ‘The Power of One’. It is much easier than recruiting more technical, creative and planning talent into a PR shop.

Advertising changes

As PR has changes so has advertising. There is a far greater understanding of what efficient and effective looks like. While I lament the the decline of advertising’s golden age; multichannel storytelling has improved. Advertising agencies have learned how to combine earned and paid media. Earned media is an incremental revenue increase advertising agencies. Advertising agencies have done earned media and not even thought about it being PR.

By comparison creative represents a big budget bump for your PR agency. That causes the client to pause and think. The expansion of advertising has wiped out the crossroads; so PR isn’t at a crossroads anymore.

Media landscape changes

As advertising has changed so has the media landscape. The online environment is shaping out with two winners around the world. The pattern of online advertsing spend is clear. Everywhere outside China online advertising is static; only Facebook and Google see increases. In China, is is Tencent due to WeChat that wins. Sina benefits from Weibo. Baidu would have been an obvious winner due to it being a Google analogue. Instead Baidu’s earnings have been static.

This decline in media fortunes adversely affects editorial space. This impacts the efficiency of media relations. By some accounts in the UK there are now 3 PR people for every journalist. PR agencies have needed to expand beyond media relations. This means trying to get more involved in owned and paid media. The challenge is that advertising agencies are also in that space – extending their storytelling. In the case of the media landscape, PR isn’t at a crossroads because the crossroads no longer exists it has become a singularity at the centre of the media sector

More information
PR not communications | 6am blog – yeah I called bullshit on this one. I could afford to be right; Richard had a global family business to defend
Whole Egg Theory Finally Fits The Bill For Y&R Clients: Global Agency Network Of The Year: Team Space System A Winner For Citibank, Others Set To Follow | AdvertisingAge
The Dentsu Way – a great book, right up there with Ogilvy on Advertising in my estimation
April 4, 2017
Micro influencers
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. Micro influencers are an extension of this, as macro-influencers value is increasingly out of whack with their marketing benefits. 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. So in some respects micro influencers fulfil a market supply need.

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 smartphone manufacturer Huawei. This has been touted as successful by the agency involved, Social Chain. 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:

(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 on influence here.

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
January 16, 2017
Brand communications
Opportunities for brand communications – 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 and so will their business. 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. It will mean recalibrating the values of some brand communications. 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 brand 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
Brand communications vs. ZBB

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

Path versus agency discipline

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
Effect of agency consolidation on brand communications

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. More marketing related content here.
December 31, 2016
Cultural Strategy
I was recommended Cultural Strategy by a client to ‘better help understand their business’. The book is an accessible easy read as business books go. Cultural Strategy is written as a mix of theory and illustrative case studies. In the book, it’s authors Holt and Cameron propose that culture can be a key defining factor in business success:
- An organisation culture can make it more resilient or innovative providing a clearly differentiated experience between a brand and its competitors in the eyes of consumers. Their concept of cultural orthodoxy is similar to the red ocean strategy, where companies in mature sectors tend to look alike.
- By understanding consumers and the cultural context of the product or service, a market opportunity can be found. This is essentially what a good planner does in an advertising agency, but the Doug’s look to bake this into the organisation rather than having it as a wrapper at the end of the product process
This meshes in quite neatly with work by marketers like Byron Sharp, Les Binet and Peter Fields that show a distinctive differentiated brand is key to success. It would make sense for the company culture to be part of the brand. An example of this would be someone like Patagonia. But it could also be applied to the B2B space. Salesforce would be a good exemplar.

Where is might fall down is when you have a ‘house of brands’ company; like usually happen in the FMCG sector. And this is why there has been so much focus on brand purpose.

After reading the book, I am still no wiser about my client was trying to say about their business; but that was more about them than my reading material. This story however emphasises an important point, what may be perceived as a cultural innovation internally in a company may not manifest itself as brand innovation or even a differentiated position. More related book reviews here.

More information

Cultural Strategy by Holt and Cameron
Cultural Strategy Group
September 17, 2015

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