Roundtable: surviving the social revolution

PANELISTS

PANELISTS

Rob Assimakopoulos, SVP marketing and commercial assets, Canadian Football League

Geoff Craig, former VP and GM brand building, Unilever Canada

Cynthia Fleming, COO, Carat Canada

Adam Froman, president, Delvinia Interactive

Jill Nykoliation, president, Juniper Park

Jeff Parent, VP sales and marketing, Nissan Canada

Bruce Philp, managing partner, GWP Brand Engineering

MODERATOR

Joan McArthur, partner, 27 Marbles Training

Marketers are spending more on social media – 23% planned to increase their spend this year (according to a Com.motion poll) – while only 4% planned to increase spend on TV. Yet according to a U.S. survey by Heidrick & Struggles, only 16% of marketers are ‘very satisfied’ with their ability to respond quickly to new opportunities in digital media. They were also largely unsatisfied with their agency relationship – working with a myriad number of agency partners on the strategy side, from agencies of record to media partners to various digital shops.

We brought our panel of experts together to discuss topics ranging from ‘Is social media all that and a bag of chips?’ to the best ways that marketing departments and their partners can organize and work quickly and effectively in the digital space.

McArthur: Lee Clow said technology has provided the next creative revolution. It really is about the art of using new media in ways to connect the brand and the consumer. So is it really a revolution?

Philp: I think there’s a great danger in the assumption that something new will replace the past. If we set aside the technological distinction between television and the web, the process we’ve always been engaged in begins with creating desire in a consumer and ends with a transaction.

The difference is that before the web, we lost control of it at the beginning: the consumer was on his own from the time we created desire to the time the transaction took place. The web has empowered consumers to complete that process with the benefit of knowledge and peer support, and we get invited in, if we play nice, to continue to influence that process right to the end. That’s what’s really changed. The fact that they go from this cathode ray tube to that cathode ray tube is irrelevant.

The analogy I like is, imagine that every brand is now an unending election campaign, and you have some control over your message and your platform and what your candidate wears, and you have no control at all over what the audience is going to say or how the press covers your story or what issue might arise during the campaign. And then you hope for the best and you play the game in [real time].

McArthur: Is this trend so seductive that people are walking away from traditional media faster than they should be?

Craig: There’s certainly risk in that it’s allegedly cost-effective. The key is to take a step back. It still comes down to the overall landscape of where things are going, and then how we address it. I don’t think it’s as simple as moving from here to there. Experimentation can be dangerous, but controlled experimentation is part of a greater strategy.

Froman: It’s really about the audience and the individual and a relevant experience. [Agencies] are struggling to work together [with clients] to do what’s most relevant when their businesses are built on a certain model. So if you’ve got the guy pushing advertising, the clients say, ‘I want something viral,’ and all of a sudden, everyone’s on Twitter. That’s not what it’s about. It’s about being open minded to how [to reach] that audience who you’re trying to create that relationship with.

Assimakopoulos: The mistake I see a lot of people making is to say ‘make this viral,’ and the challenge I would throw back to the client is, ‘make this good.’ Make your product better so that people are going to want to share. A campaign can go viral because you’ve got a really unique piece of communication, but if you’re not following up with something innovative, it was all for nothing.

If you look at the shopper’s experience fundamentally, unless you put some ridiculously crazy new ingredient in that would materially change the product, I, the shopper, am going to go to the shelf like I did last week, like I will next week, I’m going to scan the products, I’m going to look for my favourite. My favourite might have improved itself or it might have taken a little bit of price off, and that’s great; I’ll take it because I’m a creature of habit. I’ve got 30,000 choices to make, and I have a life. I don’t have time to engage in your little stunt, detergent X.

So sometimes marketers might best recognize that in their brand and in their shoppers and say, you know what, viral seems nice, digital activation seems nice, why don’t you just throw a coupon out there? You know what I mean?

McArthur: Is there a mob mentality where you start to get away from experimentation and into diminishing returns?

Fleming: It seems like when a brand decides to do something really entertaining, [they say] ‘well let’s put that out on viral, and maybe we can be a little bit more risqué.’ Yet you look at Cadbury ‘Gorilla’ or ‘I’m a Mac, I’m a PC’ and they decide, ‘I’m going to go mass and influence and persuade, and then I’ll go viral anyway.’ So are people coming at this a little backwards?

Parent: This is a unique time because if every client had [the budget] they wanted, we’d all spend more everywhere. There’s an internal discussion going on that this is a good time to experiment because [social media's] relatively cost-effective compared to experimenting with a traditional form of media. However, that’s only half of the issue. What you’re starting when you get into this is a dialogue. And you’re not allowed to stop the dialogue. You have the responsibility to talk to them and solve their problems when they happen, and forever.

Assimakopoulos: It’s like any normal human relationship: it’s a commitment, and that means you actually have to give something back. No relationship will last if the conversation is surface-level, ‘hey, how are you today? Great.’ No, it’s, ‘Do you have anything else for me? Because I supposedly have this relationship with your brand.’

Philp: Once that channel’s open it never closes, and the two ugly realities of social media in particular are that you are dead if you’re not authentic, and if you’re not capable of being authentic, stay away. And the second is, the currency of social media is not money, it’s time.

Craig: If we are going to participate, then let’s realize it has great strategic implications, not the least of which is that we should probably restructure our entire marketing organization to do this right and in the long term, so you go out there when you have a very clear purpose for your brand and you’ve framed the conversation. Does that go outside the playground? Absolutely, but a lot of it will happen there. This is a big strategic play, not a tactical play.

Froman: It’s a tough time for marketers right now because they’re getting pulled by every widget and opportunity. We work with big clients and their internal structures are not made to be collaborative, and that’s a fundamental challenge. The latest one I’m tackling is between marketers and research departments, and how you bridge that gap between providing measurability and insight at the pace at which they’re adopting technology when the research side says, no, this is our methodology, and by the time you get any data, you’re two quarters down. Nowadays you can get data to make a decision almost in real time during a campaign and tweak, but they’re not set up for that.

Parent: It’s not a marketing department issue, it’s a business issue. We have a business plan process that is five years long; we’re looking for investment in products that are going to come out five years from now that have to be bumped up against marketing budgets. Now that’s ridiculous. Everyone knows it’s fiction. The business has got to change, but at the same time, agencies have to change. Because these big agencies are not set up for this.

Fleming: [Clients] have multiple partners all coming to them with this idea over here and a digital idea over there, and there’s the need to listen to all of them in case they miss something. They’re looking for us to change and come to them with a point of contact, to manage that on their behalf. I think that we in Canada are perfectly poised for that, because I look at our counterparts in the U.S. and talk about big and siloed, it’s ridiculous.

I come from the old full-service model so I’m working with people who have never experienced that, and I was trying to explain to the kids, hey, it’s full-service again. We as an industry have to offer everything.

Froman: But it’s a people business. About three years ago we tried to shift from a traditional model to more of a pod model with teams, and we’re switching back because people can’t work together – they have their own ways of thinking about things and they get stuck in them. It’s very difficult to get people to change.

Craig: There’s a leadership void. Because when you actually have strong leadership that says, ‘no we’re going here, this is how we’ll experiment, this is how we will not experiment,’ then you make the troops fall in line. Maybe you’ll lose out a little bit on the random successes, but everyone is happier and everyone understands the rules of the game.

Philp: I wonder whether any agency in any sector has a hope of actually providing the service that they claim to provide right now. From a consumer perspective, the decisions that they make about what our brands stand for are based on observation of all of that brand’s behaviour – everything that it does, PR, news stories, stock prices, labour strife, internet presence, social media buzz, advertising. They’re not taking every spoonful that we feed them in isolation. So that means that a brand is established by the total behaviour of the corporation behind it. At the end of the day, the CEO is the brand manager now and that’s inescapable.

Parent: That’s actually true. I think one of the things that people struggle with now is that they’ve lost the theme. It’s still about your brand, whether that’s on Twitter or Facebook or CBC or on boards at a hockey game, and it has to always be about your brand as you coordinate what agencies do; it’s got to be in service of what you mean to people.

McArthur: And they’re calling the shots on your brand.

Parent: They’re always calling the shots. So if they buy soap and they put it in the trunk of their car and the soap explodes all over their food, they’re going to hate that soap. That’s part of the brand experience. That’s just as valid to them as a cool TV commercial. And we lose track of that, we channel ourselves down to say, ‘I’m going to need this in this space and this space,’ but the consumers consume all spaces.

McArthur: Theoretically, you could have [several of you], all around this table doing pieces of [Jeff's] brand. So who manages it?

Froman: It depends on what’s needed at the time. If it’s a discussion about the brand [image] that wouldn’t be me, but the minute you start talking about the digital experience, we live it. It’s all about what your capability is, and then being really open minded to the expertise that comes around the table. The client has to decide, ‘We need you to take the lead at this moment.’

Fleming: In the real world you need an experienced marketer at the table when those ideas are presented or discussed because otherwise it’s like – sorry to say – working with creative types, where there’s this great idea and they’re in love with it. I remember battles from a planner’s perspective; ‘is that digital on strategy? Is it really relevant?’ And I find people who have experience in terms of the brand are far more capable in managing that than perhaps someone who’s responsible for just bringing forward the idea.

Philp: We find this dealing with people in the digital space, and it exhausts me feeling like I’ve got to compete. I want their help, but if you come from a vertical that’s deep and you’re young and you’re filled with a sense of what’s possible, that’s the contribution I want you to make, but you’re not in a position to tell me what a brand is.

Assimakopoulos: The owner of the brand is the brand manager. Agencies sadly do change, digital agencies change, consultants change. The owner has to be the brand manager. Steve Jobs did not give his Apple brand to his ad agency; he established firmly the culture of the Apple brand to his communications partners and said, ‘make my communications look like me, and if it does not look like me, I don’t care what art school your creative guy comes from, this is my brand.’

McArthur: Jeff, tell us about the partnering scenario on your social media-only Cube launch, for example.

Parent: TBWA is our agency of record, we have Tam-Tam in Montreal, we have Kubik, Marketing Store. I have all these guys in once a year and we go over the business plan. Not everyone’s comfortable with that process. But that’s what we do, because we need all those agencies. [Then] I get a phone call one day from Capital C and Tony Chapman. So I gave him an hour, and it was a really good hour, and we thought it was a different way to go, so we went that way, and we told [TBWA] we’re going this way. And they had a problem with it, I won’t kid you. But you have to sit in the sober reality and make that choice. It was us deciding what the best way to execute against that opportunity was.

Craig: This is leadership again, and that’s a great story because I think the people who show up in the room have to have a clear understanding of the rules of engagement. They may not like it, but as long as they understand, then it’s fair.

Assimakopoulos: The only time it doesn’t work is if your brand does not have a well-established strategy. So again, it’s incumbent on the brand manager to make sure that they know which direction they’re going so they can really sift through those ideas and say, ‘okay, your idea seems most on strategy.’ Really tough environment for agencies, I acknowledge that.

Fleming: I’m kind of curious about Unilever, how long does a brand manager live on a product?

Craig: [About] two years.

Fleming: Is that enough time to do and be capable of what you’re suggesting?

Assimakopoulos: In the auto industry, brand managers lasted several years. In packaged goods, in beer, brand managers were a two- to three-year gig. But if an organization is stable, you’ll have an established network of managers and holders of these brands.

Philp: Procter was good at institutionalizing their brands, specifically because they rotated brand managers every few years.

That sense of mission is actually key. I worked on Procter brands nearly 20 years ago, Ivory and Olay as it happened, and both of those brands had crystal clear missions, they knew exactly why they existed. So it didn’t matter how many clowns from Madison Avenue you brought into the room, you could still put that piece of paper down in front of them and say, ‘is what you’re showing me doing that? Because if it isn’t, you can leave.’ And it was nearly that blunt.

Assimakopoulos: Right, and this is key: you design continuity into your marketing organization so that you don’t have entire upheavals of brand owners and all you’ve got left is paper and ideas.

Maddever: Rob, you just recently did a digital strategy shift. Who did you work with, and in what kind of relationship?

Assimakopoulos: It’s interesting because the CFL had fairly significant turnover at the commissioner and the CMO level. We were lucky – and this contradicts what I said earlier – because I work with Bensimon Byrne. I worked with these guys a lot of my career. They were the continuity on the business in the face of turnover in the CFL. The intellectual capital was not lost; in fact [they] did a wonderful job of modernizing the brand and extracting the truths of the brand through research and consumer insight. Together we iterated this strategy about what is at the heart of why people love this league, the truths the previous guys had established.

Parent: You guys say the brand lives with the client; I think it lives at the agency. Clients are worried about making cars, getting them off the dealer lots. The agency has the ability to kind of sit back and really get the brand, understand the customer. Now the client is responsible for hearing great ideas from other agencies, and say, ‘yeah, that fits I’ll use it,’ but it doesn’t negate the need for a lead agency. If you want a powerful brand you have to have a lead agency that’s got the voice and can take the creative that needs to happen in all the channels.

Philp: I think the missing piece of the story is that the agency community surrendered this voluntarily. Since the early ’90s the focus in lots of agencies has been on the ad, the ad, the ad. And that phenomenon has driven six-figure award show budgets and a ridiculous salary inflation in creative departments and on and on and on, and it eventually took entire organizations’ eye off the ball. In my view, 15 years ago, no structure in marketing communications was better suited to brand stewardship than an ad agency because strategy was so important and because there was a craft called account management and because creative was meant to serve a brand rather than a puppet show that was more interesting than a brand. So into that void have rushed people in the digital space or anyone else with an entrepreneurial idea.

Craig: It still comes down to people within an organization and it always does. I think everybody has to own the damn thing. If you’re not then what are you doing sitting around my table? There’s always somebody who just gets it and cares.

Parent: From the client side, you want to have these backbench bomb-throwing guys come in disrupting what you think is true. And half the time you’re going to throw him out of your office, and half the time you’re going to say, ‘that’s a great idea.’ And that’s okay, it keeps the agency on their toes, whether or not they’d be willing to admit it.

Fleming: We’re in pitch mode constantly, and I say pitch mode just because it’s a mentality. If we’re presenting an annual plan, it’s not an annual plan, we’re pitching every minute of the day. If God forbid there are five other people in the room, you’ve got to be in there pitching on a regular basis.

Maddever: So we talked about the strategic side and who owns that, but who is manually steering the ongoing digital relationship with the consumer?

Philp: From an agency point of view, where it gets interesting is the business model because you’re talking about the most junior people working on stuff.

Here’s the ugly truth: the typical mid-sized agency in this country makes 14, 15 points of margin. I’m going to hire someone and pay them a six-figure salary to be a creative person and then I’m going to come up with a billable rate, and I’m going to turn around and ask the client to pay that. The client will pay that if he only needs that guy twice a year to write an ad, but if he needs that guy for 20 hours a week to keep him on Facebook or Twitter, they’re not going to pay that. And so the economic underpinnings of agency bids are in for a serious ass-kicking.

It was bad enough when commissions went the way of the dodo, the real storm is coming where they’re going to want value 24/7 and we can’t afford to do it with the cost structure we’re living with right now.

Assimakopoulos: At the CFL, we have a digital media network, and in order to preserve our visitors and our page views, we need to give them stuff. We can’t have the marketer send the brief through an agency. Not just when it’s a media context but when it’s a CRM context, you’ve got to invest.

So the big question is not necessarily are we going to do this, but are we prepared to invest in it and is there a return on that investment? Don’t try to do half a media thing. Don’t launch one site with a couple films that people are only going to visit once, then abandon; you’re not going to get your money back. You’ve got to think all the way through that process, five years down the road.

Craig: It comes back to strategy. Social by definition means people are talking about it, and that moves seamlessly online and offline. If you’re successful they’re going to talk about it offline. And you have to figure out how to feed the beast.

Nykoliation: Social media is social first and foremost, it’s not commercial, and we as businesses, we’re commercial first.

Assimakopoulos: So where do commercial people get off talking about social media?

Philp: Of the people who are active in social media in the U.S., about 80% want brands to be engaged in that space. Remember that your interaction with a brand in social media is completely voluntary.

Fleming: Speaking about that non-paid space and on the social media front, people have to acknowledge [that] once you start engaging with people at that level, it’s not the millions of impressions, it’s 5,000 people, maybe 10,000. What’s that worth to me, to talk to those people? We also have to take a look at the realities of engagement in terms of the numbers relative to the investment.

Parent: It’s really up to the consumer how they’re going to engage in our brand. You want to be part of the community because commerce may result, but it can’t be the reason you’re there. It’s like the guy that tries to sell you life insurance at the cocktail party. I don’t think people want us there 24/7; they want us to have the ability to be there. It’s designing your way into their life so you’re part of it, and then when it comes time to make the next purchase decision, you’re familiar. That’s what you want.

Craig: The gist of it is about connection. It has to have meaning to them, whether it’s ideas or goals or actions. Therefore if you’re going to play in that space as a brand, you can sell harder than you think you can. You have to offer something that’s meaningful from a messaging perspective or don’t even go there.

Parent: We struggled with this recently, we were talking about the purchase cycle of automobiles and how we’re relating to people – what are we going to tell them? Are we going to give them funny games or something to do? And one of the guys in my office said, ‘how about if we just answer the questions they ask?’

Nykoliation: Someone emailed me saying, ‘I want to create a CRM program for toilet paper.’ Why would I do that? I really do think it’s just a value equation. What value do I want to bring? Am I making your life better? And from there the frequency of how often I need to do that will work itself out.

Maddever: Do people underestimate the cost?

Nykoliation: I think they absolutely do.

Parent: You’ve got to reallocate the resources you already have. Certainly the people on the phone [doing customer service] are not necessarily the people who have the skill set to create the kind of community we want. The other thing that I find interesting and empowering about social media is, you don’t necessarily need to have as many people on your side as you think, because the answers are being crowd-sourced all around you.

Philp: Where it gets interesting is that conversation is observed not only in real time but well afterwards. Google is getting so good at indexing content now, they’re indexing Tweets. And why that’s important is that if I start to interact with a brand, I’m going to see everything you want me to and I’m going to see everything you had nothing to do with.

Parent: I think what social media means is everyone is going to take their share. Apple takes their licks just like everybody else does, and you’ve got to be an adult in this game. You can’t be insecure about yourself. You are what you are, even if you do everything you know is right, somebody is going to take a piece.

Nykoliation: The consumer is part of the medium now, it’s official, whether you invite them to be or not. So for me it keeps coming back to, get your brand in order. This new world makes everyone’s game higher. The bar is higher, you’re exposed, you can be called out, you better be good.

McArthur: In the U.S., even though there are lots of big multinationals having trouble getting with the program, there’s also Goodby, Fallon, Droga and Crispin – it’s all collaboration. They bring in specialists but put them all at the table. At Goodby, everybody gets briefed at once, no siloes and best idea wins from whatever discipline, and everyone figures out their piece of it. There are a few agencies in town getting it. I talked to a guy in New York at Ogilvy One and said, ‘Where’s this going?’ and he said, ‘[the agency side] is all going to collapse.’

Parent: The way agencies have been built in the recent past, in the last 15 years, there’s a lot to suggest they [will collapse]. More and more big companies are insourcing bigger and bigger parts of their marketing operations; Hyundai does it in the States, Toyota does it worldwide except the States.

There’s been major upheaval in some of the big categories – Anheuser-Busch got sold and that was a huge issue for their agencies, and on the auto side, GM is under tremendous pressure on agency margins. Mega-agencies have creative teams around the globe for one huge global company – Pepsi, Nissan, etc. They start to make their own weather until it’s, ‘Oh my God, there’s 800 people worldwide working on this business,’ and somebody on the [client] side says, ‘did you realize how much we’re paying these guys? Aren’t we supposed to do some of this ourselves?’

It does collapse on itself where you say, ‘I want a relationship with your agency but I don’t want a relationship with the people you deem in your agency are my people,’ I want you to come in and do the shootout, and I want them all together and let’s see who wins. I do think that on the client side the expense is huge to support what is essentially another marketing department.

Fleming: I think there’s a massive lack of understanding of the effort and resources behind the work that’s being paid for, certainly on my end because we offer a range of services. My core service is media management and execution and the margins there don’t exist, there aren’t any.

The model is broken and has to change, because there’s no way companies can offer it this way moving forward. But what I see is a lot of pressure on the global client side for one idea that’s created by a team in whatever geography, that’s taken across the globe…Large clients are looking for efficiency: ‘why do I have to pay for somebody in five countries, I’ll just pay one country and you’ll serve it all up.’

Craig: Given the change that’s going on in the ecosystem of marketing, and if you roll in some of Richard Florida’s ideas, should you be looking for a whole new group of people to manage brands, assuming you have that infrastructure to work within? So is this now a time for dramatic change?

Philp: You can see the marketing communications industry deconstructing itself and disintegrating, and you can see that there’s no systemic support for the idea that brand stewardship can exist outside the marketer.

I actually think that when history gets written about the time we’re in right now, this revolution, that it will be recorded as the era in which marketers had their brands handed back to them for better or worse, the stewardship passed back to the marketer.