Category: Podcast

Audio branding can build long-term brands. Author Laurence Minsky joins us on IN CLEAR FOCUS to discuss the theory of audio branding and best practices.

IN CLEAR FOCUS this week: Transcending language and cultural barriers with audio branding. We’re joined by Laurence Minsky, an expert and co-author of the book, “Audio Branding: Using Sound to Build Your Brand.” Larry discusses the theory and practice of creating entire sonic languages and how they can be leveraged for long-term brand-building. The show notes link to the case studies discussed in the episode.

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Episode Transcript

Adrian Tennant: You’re listening to IN CLEAR FOCUS, a unique perspective on the business of advertising produced weekly by Bigeye. Hello, I’m your host, Adrian Tennant, VP of Insights at Bigeye. An audience-focused, creative-driven, full-service advertising agency, we’re based in Orlando, Florida, but serve clients across the United States and beyond. Thank you for joining us. While all marketers are likely familiar with visual branding, a growing number of marketers are using palettes of unique sounds and music to support long-term brand-building. Product designers too are leveraging the possibilities of audio to give consumer technology devices friendlier personalities. Researchers have found that music is a language that people all around the world can understand. Certain types of instrumentation and rhythms convey consistent meanings often subconsciously working at a symbolic rather than an explicit level. Audio branding is employed by many companies that compete internationally such as tech firms, Apple and Intel, beauty and skincare giant, L’Oreal, German car manufacturers, Audi and BMW, and their French competitors, Renault and Peugeot. But audio branding is less prevalent among domestic brands, which of course offers a novel way to differentiate from competitors. Our guest today is Laurence Minsky, an expert and co-author of the book, “Audio Branding: Using Sound to Build Your Brand,” which describes in detail the theory and practice of creating entire audio languages for brands. Laurence Minsky is Associate Professor in the Department of Communication and Media Innovation at Columbia College, Chicago and the author of many books on advertising and marketing. He’s also an award-winning marketing strategist, creative director and copywriter focused on creating innovative and effective branding and cross-discipline marketing solutions for many leading brands. Professor Minsky, welcome to IN CLEAR FOCUS.

Larry Minsky: Thank you for having me. And by all means call me Larry while we talk.

Adrian Tennant: Will do, Larry, thank you. What’s your definition of audio branding?

Larry Minsky: Audio branding is the use of sound that’s ownable by the company, by the brand to reinforce brand attributes. 

Adrian Tennant: What are some of the main reasons marketers need to consider audio branding today?

Larry Minsky: I’ll give you one reason why every marketer needs to consider audio branding today. And that is because of the growth of voice assistants. Right now it’s still in its infancy, but do you really want to leave your brand when there’s no picture, no visual, no colors, no fonts, no anything of the traditional branding sense representing your brand? And you’re leaving your brand up to Alexa or Siri? In Europe where audio branding is much more advanced. You know, the countries are smaller, there’s more languages and it gets really expensive to have a brand in every country and you want something consistent and you want to be able to convey it consistently. In America as we continue to diversify, our populations, that will become an issue as well. But Audio branding is a much quicker way of communicating your brand; sound communicates much faster and sound also helps direct visuals. 

Adrian Tennant: So you mentioned that the practice of audio branding seems a lot more prevalent in European countries than here in the US. Is there any other reason for that, do you think, beyond the language issue? 

Larry Minsky: You know, US marketing maybe is a little bit more hard-sell traditionally, “Buy now!” “Do this!” – all that kind of stuff. European marketing tends to be a little bit more indirect, a little bit more elegant. So, there’s probably an aesthetic area that helps bring it about quicker in Europe. But you know, practically, you do want your brand across cultures, cross borders and sound is much quicker and easier to do that than language.

Adrian Tennant: Now, when hearing you and I talking about audio branding, I’m guessing some listeners may think about jingles, that is advertising slogans that are put to music. But I know you don’t think jingles really qualify as audio branding. Why is that?

Larry Minsky: A jingle was written to carry the words. It goes back to what we just said that in America it was a lot harder sell. So, you know, “call 1-800-whatever,” and they sing it out is a jingle. And so the music was secondary. The sounds were secondary. A lot of those sounds don’t seem to be ownable. Some of them are like Nationwide. That is starting to become an audio brand simply by how they use it. And they’re starting to play around with how they use, “Nationwide is on your side.” But essentially that did start as a jingle. So a jingle can evolve into an audio brand but it is not the same thing. The NBC chimes started as a way to align things and it was a more technical issue but over the years it became part of the audio brand. So, there’s different ways in but the best way is the way you do any kind of branding and that’s to be strategic about it and think about what your brand attributes are and what do you want to convey and then develop the sounds that actually convey it.

Adrian Tennant: Mmm. Now, some brands of course do have sounds associated with them which advertising often supports. So, I’m thinking about, say, the roar of a Harley-Davidson’s engine, there’s the pop of a Snapple lid, and of course, when you start up your Mac computer, there’s a sound that accompanies that. Do you think these qualify as examples of audio branding?

Larry Minsky: Yes. Anytime you use sound to help convey an attribute, it’s an audio brand the snap of a bottle for Snapple pop. You know, you hear it, you’d get reinforced when you’re opening the bottle. So there’s positive reinforcement there, but you could use that in your advertising. You could use that on TV, on radio, on your website, eventually on your voice assistant applications. So anytime you’re using sound to help build your brand, it’s part of audio branding and really should be thought through strategically.

Adrian Tennant: Right. Now, one US brand that has consistently employed music as part of its brand is United airlines, which has used George Gershwin’s “Rhapsody in Blue,” since 1987, I believe, at an annual licensing cost of $300,000. Larry, I know you’re based in Chicago, which is United’s home base. What do you like or dislike about United’s approach?

Larry Minsky: What I like is Gershwin’s song is very adaptable to multiple situations and you still get it. It still reinforces and there’s a lot of positive emotion attached to that and movement and energy and things that convey United Airlines. What I don’t like is really, it’s not ownable by United. Anyone can license that song. It’s now gone into the public domain I believe. And so anyone can use it. It’s better to start with “what do you want to convey?” “who are you?” and then create something that you could own, basically permanently.

Adrian Tennant: In the book, you mentioned Intel as an exemplar of successful audio branding. Those four notes have been around for 25 years and while Intel has modified the instrumentation over the years, those four notes have remained the same. Do you think all brands should aim for this level of discipline when it comes to their audio identities?

Larry Minsky: All branding should be disciplined and if you’re doing it right, strategic and thought through. A brand is not solid where you don’t tweak it over time, you know, the, the best way to maintain a brand is to evolve it slowly, imperceptibly, so it stays up to date and it works in multiple areas, but still conveys values and, and the enduring attributes that you want to convey. Good brands, brands manage or companies that manage their brands spend a lot of time thinking about it and doing it visually. You should do that the same way with sounds. And do think of it as a long-term investment. You don’t see Intel chips when you’re buying, but it is a proof point for all the computers you buy with an Intel chip inside it. And that branding has helped Intel make a name and make it a proof point. What other chips are out there? What comes to mind really quickly and you could see why Intel is so effective because I don’t think a lot of people are going to come up with other chip makers that, you know, give them as much reassurance as an Intel when they hear that little sound.

Adrian Tennant: So Larry, I’m sure you encountered many examples of audio branding as you were conducting your research for the book. Do you have any favorite examples? 

Larry Minsky: One of the examples, for Royal Air Maroc from Morocco really captured the essence of the country. And there’s a lot of different musical styles in Morocco. So they had to bring them all together. And I thought that was a very, very interesting kind of audio brand from the French Open and, and how they use it, I find very interesting as well. It’s not just they have their audio brand that they use when they award the trophies at the end. And then they have whole environments for where you park when you go in retail settings. They even have an audio brand playlist for the athletes when they pick them up to drive them to the venue. So I found that kind of interesting. La Roche-Posay, it’s just an elegant kind of sound and, and really gets the feeling down. So, there are so many different examples out there of audio branding. MasterCard just came up with an audio brand not too long ago. And I do know on at least one scale, the value of their brand increased proportionally because of it. And that was the only thing they changed in their branding was their audio brand and refine their logo a little bit. And it’s just helping the brand differentiate itself today too. MasterCard did it after the book came out, but you could easily Google it or search for it and you could see the success that it has helped them.

Adrian Tennant:  Larry, I believe your introduction to audio branding came from your co-author Colleen Fahey.

Larry Minsky: In a way it did, but my exposure to it actually started earlier than that. I was a chief creative innovator or chief creative officer of a small agency and we had a publicly traded company as a client that had a pickle brand that was falling fast in the marketplace and the company was afraid that that would hurt their stock price. So they brought us in to stop the decline. And in our research we found that our pickle brand tends to get eaten up. A lot of people buy pickles, they eat a few, they put in the refrigerator, they might grab a few more, but eventually the pickle jar makes it to the back of the refrigerator. Pickles get soggy, they throw them out and then eventually maybe a back to school or some other kind of occasion, they’ll buy another jar and the cycle starts over. So we decided to promote the aspect that people love our pickles so much, they’ll eat the whole jar as our benefits. So we positioned it as the emptiest jar in the house. And how do you dramatize empty jars on radio was we decided to use a fork in a glass jar to hear the “ting” of it going in because it’s empty. And our campaign not only stopped a slide of the brand, it turned it around and made it the number one in the markets where it was sold most of its markets and in one market and in fact achieved a 40% share. So I started to get curious about the sound and how it plays in terms of building a brand and I thought that was an audio brand. Then I was working on another book and a collection of essays and Colleen and I, we come from the marketing services promotion firm and she had written an essay a long time ago about considering that as a career. And my publisher suggested that we use it in the book. And so I met with Coleen to modernize that article and she started talking about what she was doing with audio branding. And I learned that it was so much more than just a little logo at the end. It is a whole sound system. And one of the ways, in terms of how to use it, even for a package goods even for or, or any brand, even for a business-to-business brand, about half of Coleen’s agency’s clients – Sixième Son – are business to business firms. And you think of all the different touch points and it’s not just, you know, a consumer radio spot, which is where jingles end up. But think of the sales meeting. You bring all of your people together and, you know, you introduce the CEO with one type of music, you introduce the head of marketing with another type of music and you come across as disjointed to your employees and your employees need to understand the brand just as much as your consumers. And so you could bring a language to this that has full flexibility and, and, but still brings back the core notes so it conveys what they’re about. So you could use it even in an internal setting, such as a sales meeting. You could use it as a ringtone. You could use it on the website and voice assistance eventually, all sorts of things. So it’s really a comprehensive solution. And that’s what I learned when I sat down with Coleen and I said, “we gotta write about this.” And Colleen was doing a lot of writing. She’s a writer unto herself and that’s her background as well. And we collaborated on an article for Harvard Business Review where we looked at one of Sixième Son’s clients and that was the French railroad SNCF, which is one of the most recognizable sounds in Europe is their audio brand. They use it in stations, they use it on the trains when the doors are opening and closing. They use it in their advertising, you name it, it’s used and it’s highly, highly recognizable. And David Gilmore liked it so much he licensed the use of it for one of his songs and so every time that song gets played at reinforces SNCF. So there were so many different uses of it. So we wrote an article for Harvard Business Review on it where we actually went through the evolution of it and you can hear the different sounds in that article if you go on the online version of that article, if you go to it. And from there, we continued writing and you know that there needed to be a book on the subject because people understand it.

Adrian Tennant: One of the things I like most about the book, and I read a lot of marketing books, is the inclusion of pieces authored by branding practitioners such as Michaël Boumendil, who’s the founder of Sixième Son, the first sound design firm dedicated solely to audio branding. Plus you have articles from ad agency, veterans, Ben deSanti and Ken Hicks. But you also include contributions from academic experts, including professor Charles Spence, a cognitive neuroscientist based at Oxford University who explores people’s associations of musical notes with particular aromas. And his article describes really fascinating experiments that pair music with food often with some surprising results. Can you speak to that?

Larry Minsky: Yeah, I’ll give you a very basic thing, but cause audio branding is much more than just being in very tactical sales generating kind of thing. But there was research done in a grocery store chain where they had French wine displayed next to German wine. And on one day they would run German music and people would buy more the German wine. And other days they ran French music and the French wine’s brand would sell more. And people were asked, “well, why are you buying it?” And so, “well this one, this wine is going to pair better with my meal,” and all that kind of stuff. But what they were really doing was being influenced by the sounds, but they weren’t cognitively processing the information and saying, “well, I’m buying this wine because I heard this French song or this German song,” or whatever. It just helps set the mood for that kind of product. And so that was enough. That example might sound a little manipulative. That’s not really what audio branding is about. We’re not here to say, “okay, today you’re going to buy more French wine or more German wine.” But it’s really about reinforcing the brand attributes because if the brand attributes are what make people want to buy the product, they will buy the product or they like it better or I’ll talk about it or they’ll feel better about it. Whatever you need to have done and reinforce the qualities of the brand – it’s why you trust it. And  audio branding can help contribute to the trust factor.

Adrian Tennant: Many of our listeners are familiar with the creative process of designing a visual brand identity – for example, using visual mood boards and then refining designs based on some combination of client feedback and consumer research. Can you briefly explain what the creative process for audio branding looks like?

Larry Minsky: It’s very, very similar. It is. I’m first sitting down and figuring out what, what do you want to convey? What is the brand DNA that you want to send out to the world? And then from there you go into sound moodboards. It could be existing stuff, but you put it together and you hear, well, here’s one direction, here’s another direction, here’s another direction. What’s conveying, what’s working? And then you start composing those kinds of things and for mood boards and it becomes unique. And then you start researching it and you’re saying which one is working and what, what does it say to people when they listen to it? And, and then they refine it. It’s exactly like doing a visual brand. Doing a sound brand, you walk through the same steps except you hear it instead of see it. Really it should be just like figuring out what the visual brand is and what the visual brand promises and how you bring it to life in different aspects should be thought of upfront. In many ways, and this is another benefit is the licensing fees overall are lower. When you have an audio brand, you have all the development. And sometimes it depends on what you do in terms of how you get it, whether it’s licensed from name, audio, branding firm or whether you, you own it all clear out, but you need to make different iterations. But overall it becomes cheaper and easier to manage. So you’re saving money on one end because if you’re doing a lot of TV or doing a lot of radio and you need a lot of sounds, you know, you gotta pay for it.

Adrian Tennant: So do you have a couple of audio branding do’s and don’ts that you’d like to share?

Larry Minsky: I would guess the number one DO is create one and start bringing your sounds together and making them consistent and aligned and working for your brand instead of helping communicate that your brand is disjointed. Do follow a disciplined process. Go do it. Like you would do a visual brand, think it through, do the research, do, do the hard work upfront. Those would be the, in a, in a very short way, the very main dos. DON’T think of it as a jingle thing. Don’t think of it as one-offs. Think of it as a system and do think of it long term. Don’t think of it as a short term solution. It’s an investment in your brand, just like your colors, your fonts, your logo.

Adrian Tennant: Larry, you balance real world advertising practice with a parallel career in academia. In what kinds of ways does one inform the other?

Larry Minsky: Great question. My research, my writing, helps me inform what I do. I hope it helps inform other people, what they do. My teaching keeps me on and my consulting, my working in the field helps bring back, well what are the issues out there today and what can we look at? So what I do research-wise and writing-wise, they all work together.

Adrian Tennant: Excellent. We will of course include links to the examples that we’ve discussed today on the IN CLEAR FOCUS webpage. But if listeners would like to know more about your work, Larry, and either this book or the many other books that you’ve written, where can they find you?

Larry Minsky: You could just go to Amazon and put in my name, Laurence Minsky and go to my author page and there is the complete list of books. My two current books are on Kogan Page and then I have another one on with that just came out on Global Brand Management. So how do you manage a brand that crosses borders? What are the issues, and or crosses cultures? I have another book, The Activation Imperative on how do you align all of the different disciplines to drive people down the path to purchase? 

Adrian Tennant: Larry, thank you very much for being with us today on IN CLEAR FOCUS. It’s a really fascinating topic. Thank you very much for sharing your insights about audio branding with us.

Larry Minsky: Thanks for having me. I enjoyed the discussion. Hopefully, you found it just as interesting and enjoyable as I did.

Adrian Tennant: Thank you. My thanks to our guest this week, Laurence Minsky, co-author of Audio Branding: Using Sound to Build Your Brand. You can find links to resources we discussed today on the IN CLEAR FOCUS page at bigeyeagency.com under “Insights.” Just click on the button marked, “Podcast.” Consider subscribing to the show on Apple Podcasts, Spotify, or your favorite podcast player, and if you have an Amazon Echo device, you can use the IN CLEAR FOCUS skill to add the podcast to your Flash Briefing. Thank you for listening to IN CLEAR FOCUS, produced by Bigeye. I’ve been your host, Adrian Tennant. Until next week, goodbye.

 

George Zwierko of Rumbo Marketing discusses the characteristics of Hispanic consumers and what influences their estimated $1.7 trillion in purchasing power.

IN CLEAR FOCUS this week: Hispanics make up around 18 percent of the total US population, yet there’s a disparity between the proportion of ad spend allocated to Hispanic media and the number of Hispanics living in the US. Multicultural marketing expert George Zwierko of Rumbo Marketing joins us to explain the characteristics of Hispanic consumers, where they spend their time, and how they engage with advertising. We discuss popular misconceptions, dispel some urban legends, and identify what influences Hispanics’ estimated $1.7 trillion in purchasing power.

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Episode Transcript

Adrian Tennant: You’re listening to IN CLEAR FOCUS, a unique perspective on the business of advertising produced weekly by Bigeye. Hello, I’m your host Adrian Tennant, VP of Insights at Bigeye. An audience-focused, creative-driven, full-service advertising agency, we’re based in Orlando, Florida, but serve clients across the United States and beyond. Thank you for joining us. Within the next couple of weeks, homes across the United States will begin receiving invitations to complete the 2020 census on April 1st – and on November 3rd, Americans will vote to decide who will become the next president of the United States. Census data suggests that people aged 18 to 45 years old will represent just under 40% of the eligible voters this year and it’s expected that more than 30% of them will be non-white. This reflects an increase in the numbers of voters identifying as African American, Hispanic, and Asian since the 2016 Presidential election. A report from Horowitz Research published late last year showed that diversity in advertising can have a positive impact on the purchase decisions of multicultural consumers. Ads that show mixed-race couples and families had a 31% net impact on brand perception. 38% of respondents said that advertisements that portray diverse multicultural people in them are reflecting the true essence of the United States. Although Asians are the fastest growing demographic group, Hispanics make up around 18% of the total US population and currently command an estimated $1.7 trillion in purchasing power. The amount that brands have invested in Hispanic media has been rising over the past few years, but there’s still a disparity between the proportion of ad spend allocated to Hispanic media and the number of Hispanics living in the US. Adobe’s research found that 40% of Hispanic respondents have walked away from a brand for representing them in its advertising. The Hispanic market is clearly an important one for brands to engage with. To help us understand the characteristics of Hispanic consumers, where they spend their time, what platforms they prefer, and how they consume branded content, I’m joined today by a pioneer and expert in multicultural advertising. George Zwierko is the Principal of Rumbo Marketing with offices in Tampa, Florida, and Nashville, Tennessee. Since graduating with a degree in art direction from the Pratt Institute of Art and Design in New York, George has had an illustrious career in advertising, holding senior creative positions in agencies. In 2005, George founded Grupo D, the Hispanic marketing division of the Dutcher group, the success of which led George to launch Rumbo in 2008 as an independent multicultural firm. With over 20 years as a creative professional in general market and multicultural marketing, George has garnered multiple local and national Addy awards in a variety of disciplines as well as several Telly awards. In 2018, George was recognized with the American Advertising Federation’s Silver Medal for advertising excellence and service on behalf of the advertising industry. George is also a partner with Three Chairs Productions, a video production and marketing company based in Tampa. Welcome to In Clear Focus, George.

George Zwierko: Thank you. It’s great to be here.

Adrian Tennant:  I mentioned during the introduction that the expansion of the Hispanic population accounts for almost half of America’s population growth since 2000. What do you think are some of the most common misconceptions brands have about Hispanic audiences?

George Zwierko: I think that there is a barrier that’s put up by certain advertisers because there’s just a lack of understanding of what the capability of these audiences have regarding spending or regarding usage. There needs to be a level of education when it comes to how we can best communicate and connect with diverse audiences. I think the misconception is that you might have a product, brand or service, and you feel that if I’m spending money and I’m targeting my general market audience that somehow, some way I’m going to touch my ethnic audiences, or that my ethnic audiences represents such a small population of the folks that would utilize our service or product, that to give it any weight regarding, let’s say a media spend or any creative execution is just not worth the effort.

Adrian Tennant: Twenty-six percent of all children in the US up to the age of nine are Hispanic and more than half of the Hispanic population is under the age of 29. How do you think the growing strength of this population will impact, , popular culture and by extension, the kinds of creative developed for advertisements?

George Zwierko: I think there’s an opportunity to look at our Hispanic audience and see that, um, a good majority of our audience is bicultural, bilingual, because they do skew young. I think there is a greater opportunity for us to create campaigns that are more relevant and are more relatable. The problem that we run into is that in the past a lot of brands and many advertisers would strictly translate their ads, and I think that was because of lack of understanding of the Hispanic audience as a whole. The problem in translation is that if we create advertisements that are meant to be funny, witty, clever, highly conceptual, and then you translate that, those things don’t always translate correctly. And then what we’re left with is just a very bland advertisement. But what we like to do is really hone in on what we can create, what type of creative can we do and original content could be made that still keeps the essence of the original messaging. 

Adrian Tennant: So brands should think less about translation and think more about transcreation?

George Zwierko: That’s correct. And transcreation is just what that is. It’s taking your message or your content, your visuals, everything that you put into your campaign. And then developing an execution that’s going to be relevant to this new audience.

Adrian Tennant: Now, the amount of total ad spend brands have invested in Hispanic media has been rising in the past few years. But eMarketer has reported on the disparity between the proportion of ad spend allocated to Hispanic media and the number of Hispanics that are actually living in the US. Why doesn’t the Hispanic audience receive its fair share of ad dollars, do you think?

George Zwierko: It’s sad to say, but think there’s a lack of understanding of the value these audiences bring to the table. I think many people in a variety of different positions just take a stance when it comes to communicating to other audiences, I don’t think they personally recognize the value. So therefore it won’t exist in any strategy moving forward. So I would say it’s narrow thinking or just missed opportunity. I do agree that the spend is going up incrementally. I don’t think it’s anywhere near where it needs to be. And I think there’s a great opportunity for us to just reevaluate what our spend does look like. And to us it’s a very simple formula: we’re doing a local campaign and we’re going to communicate it to our local audience. And we look at the local population as being a certain percentage of  non-Hispanic, a certain percentage Hispanic, and so on and so on down the line. And we look at those audiences. And we start to look at our customer profile within that population and we identify that, you know, within the non-Hispanic market, we’re going to be speaking to this demographic. But then a very similar demographic exists within our Hispanic population and in our African American population. So taking those new percentages, let’s reevaluate what our spend will be and then also look at what is going to be the best avenues and the best channels for consumption based on those consumer behaviors, based on what we know non-Hispanics do and, and Hispanics will do and African Americans will do and then target appropriately and spend appropriately. So that might mean that I’m not going to take 100% of my budget and throw it toward one audience and then hope that if I pepper in some folks that look Hispanic in my TV ad or I pepper in some people that look African American and my billboards, that I’m going to be effectively touching those audiences. We’re going to miss something, whether that’s going to be in the message or in the execution of the creative. Somehow, some way, we’re going to miss the mark. And what by missing the mark, we’re just doing an injustice to the brand. We’re not communicating that brand as effectively to other audiences as we did to our general audience

Adrian Tennant: Google has undertaken multicultural research and reported that more than half of Hispanic audiences are more likely to use English when conducting searches or consuming content online, even if they generally speak Spanish at home. So when you’re developing advertising designed to reach Hispanic audiences, how do you determine which language to reach them in?

George Zwierko: That’s a very interesting question and what we do is we understand that our Hispanic audience, because they skew young, more than likely a good percentage of that population is bilingual, bicultural. So that gives us a great opportunity to effectively reach this one audience on two sides of the fence, we could run English language ads, we can run Spanish language ads, because we know the consumption of this audience will be going back and forth. The ability to naturally go from English to Spanish is very fluid with a lot of Hispanic households. And we recognize that. Now that’s not to say that we don’t have an opportunity to just run Spanish ads. We might do that, but we’ve run campaigns that have been strictly English, strictly targeting a younger bilingual, bicultural household or audience. And we’ll run that ad in English, but we pepper in some cultural nuances, things that we know are relatable – that could be a phrase, it could be if we’re running a TV commercial, it’s a gesture. It’s just these little things that we know are culturally relevant and are relatable to the people that we’re speaking to. It just makes it more real to our audience. Even if it’s in English. It’s just a better reflection of how they live their lives. I think it really humanizes the message. 

Adrian Tennant: Hmm. I really like that idea. So the inclusion of some elements of Hispanic culture in advertising, even if an ad is in English makes audiences feel a little bit like the brand is understanding them with a kind of a cultural nod or wink?

George Zwierko: Correct.

Adrian Tennant: Right. While Hispanics own smartphones in similar proportions to the rest of the US population, our research suggests that they spend, on average, two hours more per week on their mobile devices, the non-Hispanic audiences. Why is this, George?

George Zwierko: It’s interesting. When it comes to smartphone usage, I think what we’re finding is that there’s, there’s two things. We have Hispanic households that could be multigenerational, you know, more folks in the household compared to non-Hispanics. So you look at just the devices someone would have on their home. So you have a desktop or you might not have a desktop. And so I think the access to the internet today with things like 4G, 5G, the affordability of wifi enables us to use our smartphones more as a way to consume and to gather information, and to live our lives online, than just being chained to a desk. So I think it’s the affordability of providing internet access to multiple people within a household, which I think lends it to the stat that more Hispanics are on their smartphones than non-Hispanics, for example.

Adrian Tennant: Hmm. That makes a lot of sense. A study from Viant in 2017 showed that Hispanic millennials – also known as Gen Y – is the cohort most likely to interact with brands on social media. And the study found that almost 50 percent of Hispanic millennials said they had talked about a brand online with others or use the brands hashtag compared to just 17% of non-Hispanics. So to cultivate brand loyalty, it seems like social media might be an even more important channel for Hispanics than say, for the general market. Do you agree?

George Zwierko: I agree, I think the opportunity to use social media to, to cultivate brand loyalty is across the board, I think you’re starting to see that uptick across multiple generations, everywhere from Baby Boomers to Gen Z. I think across the board, social media is just becoming more relevant in our lives and advertisers are beginning to realize that putting more money toward a social media platform just makes better sense for building brand loyalty or creating awareness. I think it’s identifying the social media channels also that are used with one generation over the other or one particular ethnic group over the other. I think you’ll find some stats that support that one platform gets more usage, when you start to look at certain demographics. I think there’s always going to be an opportunity for us to use social media to attract our younger Hispanic audience to create that loyalty. And I only think that that’s going to continue to grow. We’ve run many campaigns where we stay away from any advertising in the traditional sense and put more money into a digital space. Sometimes that’s 100% of our spend when it comes to targeting Hispanics. Just because we see the uptick in an online usage between Google searches and programmatic and retargeting. I mean, the numbers are just skewing so high. And, and that could go back to the last question we talked about when it comes to smartphone usage I think that where we’re identifying who has the most devices and the best way to talk that audience. 

Adrian Tennant: Hmm. Yeah, that makes sense. So let’s switch gears a little bit. Can you explain how Rumbo typically works with partner agencies like ourselves to develop a multicultural campaign?

George Zwierko: Absolutely. You know, for us, partnering with ad agencies has been part of our model since our inception. It always made the most sense. It goes back to why, when we had our traditional agency, we created a Hispanic division, which was Grupo D, which you introduced earlier. It just makes sense for us to provide a multicultural service to agencies that don’t offer that. Now we can come and partner with agencies on multiple different levels and provide a variety of different services. For some agencies we come in on the creative side – but sometimes we come in as just purely as consultants and help guide their creative team or their strategy team or the accounts department just to kind of help them better understand or identify opportunities with their existing client base. And so we help clients identify the best clients on their list that would benefit from doing a multicultural campaign or developing a multicultural strategy. 

Adrian Tennant: So George, what does your process look like?

George Zwierko: Sure. So, for example, we do a lot of work with financial institutions. Over the years we’ve partnered with quite a few credit unions and banks. And with that relationship, the process always begins with us looking at their existing customer base or their member base. Usually we’ll launch with a campaign that communicates to their existing customers, showing that the credit union or the bank provides the types of services that our Hispanic customers are looking for when it comes to finances. I think the approach to how you sell bank products, financial products is a little different. There are certain nuances to the Hispanic audience that are very different from your English-speaking non-Hispanic customers. So what we do is we help the bank or credit union identify those things and actually see them. What we’ve known and what we’ve seen in the past is that you’ll have a Hispanic family come in and they want to speak to a teller who speaks Spanish. They would prefer to speak in their own language. And so the bank or credit union from an operational side may only have one teller available that speaks Spanish. And so that teller might be occupied and maybe the availability of that individual that they’re trying to reach, that person may not be available for about another 30, 40 minutes. But surprisingly, you’d find the Hispanic family will wait. They’ll wait 40 minutes, they’ll carve a lot of time out of their day because they really prefer to speak to this one individual and build a relationship with this one individual. And then every time this, this individual, this Hispanic individual or the family comes in, they’re always looking to talk to that one person. So from an operational side, you know, we’re advising credit unions and banks to staff up on Spanish speakers. So maybe then that graduates to a recruitment campaign, how do we staff appropriately to handle our Hispanic, Spanish-speaking customers? Then we also look at products. What products are you offering? What products resonate better with our Hispanic audience based on their financial needs? We notice that the financial needs might be different – certain products will resonate well with certain Hispanic households and others may not even be top of mind. But then how do we cross-sell those other products? And it’s always going to be a little different than you do your non-Hispanic audience. Even how you talk to these customers, your approach, we found that when it comes to talking about your finances, for many Hispanic families, it’s a very private, intimate thing. It’s something that’s not lightly shared. There’s a sense of privacy that needs to be taken into account so we have to be sensitive to those things.

Adrian Tennant: How have you seen really cringe-worthy, creative designed for a Hispanic audience that completely fell flat? 

George Zwierko: You know, that’s, that’s an interesting question because I think what we’re starting to see is that mistakes isn’t happening as often. And the reason it’s not happening as often as, because advertisers are getting wise to not relying on things like Google Translate or trying to ask their next door neighbor if they can help copywrite an ad. I think advertisers and agencies are starting to realize that they either need to hire professionals or bring in a professional to develop a messaging and strategies and copy and so forth. So a lot of the mistakes that were made are the ones that we’ve always heard in our marketing classes are really almost urban legends. Like the big one that was always talked about was Chevy’s Nova campaign where you take Nova and if you translate Nova in Spanish, it sounds like “No-va” – “doesn’t go,” but that campaign launched, they were selling Chevy Novas and in central America and Mexico and around the world without any problem. And actually there were upticks in car sales all over the country, all over South America, and central America. So there’s really no weight to this urban legend that that was an actual problem that consumers in those countries were looking at the brand name or the name of the product, Nova calling it “No-va” and then ridiculing the brand. And Chevy took a nosedive and sales that never actually happened, but yet it’s one of the sample examples that is used in multicultural classes and in classroom instruction to this day. I think what we can do to avoid, we can look at this, this story, even though it’s an urban legend and, and realize that what it really takes is us truly understanding our audience and not thinking that all Hispanics that make the Hispanic population are all pigeonholed into the same silo. I can’t assume that if I’m using cultural references that are very Mexican, that that’s going to appeal to every Hispanic in the population. Everyone comes from someplace else and there’s a variety of different traditions and cultures that accompany these populations. I think it’s just truly understanding, “who am I speaking to?” and, “how do I make it relevant to the people I’m talking to?” For example, if we’re running campaigns in Orlando there’s a large population of Puerto Ricans that live in Orlando, Kissimmee and that in Central Florida. So I’m going to rely on the cultural references that resonate with that audience. You know, what can we include in our messaging that is going to resonate with that particular group? But let’s say I’m in Houston in Texas where there’s a large percentage of Mexicans that make up the population, well then how am I going to address that audience? But if I live in a melting pot, like let’s say Tampa or New York, you know, there we’re going to take a different approach because we want to make sure that we can communicate across the board to our entire Hispanic population because they come from a variety of different countries. So I think we learn from these stories we hear about campaigns and brands that got it wrong. There was the “Got milk?” campaign that used the headline, “¿Tiene leche?” which can be understood as, “Are you lactating?”

Adrian Tennant: (Laughter)

George Zwierko: But that has never been proven to be true, you know, and a lot of promotional campaigns run locally. So sometimes it’s hard to prove if something was said wrong or if something was said right, but these are the stories that exist out there. And I think it’s just like any story, there’s a moral to be learned. 

Adrian Tennant: Now, George, I understand that your family has both Latin and European heritage. In what kinds of ways – if at all – did that influence you growing up? 

George Zwierko: That’s an excellent question because I grew up in a household where I was totally confused, I think! My mother was born in Puerto Rico and I grew up in the Bronx in New York, and we lived in a neighborhood that was – the majority of the folks in that neighborhood were a Spanish, Puerto Rican, Dominican. It was about 99% of our neighborhood. And my mother, which I always say was the head of household, regardless of what my father might think, we grew up in an environment where we lived on Spanish food. We listened to Spanish music. Spanish was spoken in the house. All our friends spoke Spanish. We just grew up in an environment where the influence was very Latin. And then my father, unfortunately, was the odd man out. He didn’t speak any Spanish – loved my mother to death. But I had very limited access to my dad’s side of the family. Occasionally we would do the family reunion thing or go visit my grandmother. And my dad being European, was born in Poland. There was a big Polish influence when we would go to those types of events. But it was interesting for me as a child just to see both sides and appreciate what both sides had to offer. The language, the food, the traditions, the values, the superstitions were always really interesting too. There was always a little bit of similarity between the two. But then, you know, you’d find these major differences. And so I think growing up, it just made me aware of that, you know, we all come from different backgrounds and we all bring amazing things to the table.

Adrian Tennant: George, we have a very active and engaged internship program here at Bigeye. For students or young professionals just starting out in their careers, what advice would you give to help them apply a multicultural perspective in their work?

George Zwierko: I come from a general market background. Most of my career was in the general market side of things – full service, fully integrated agencies. And I chose to get into multicultural marketing. It’s not easy. I think multicultural – it’s almost like there’s a science to it. I always like to say that we’re kind of like anthropologists, we really enjoy being multicultural because we love learning about the essence of people. How do people think? And why do they think a certain way? And how do they behave a certain way? And what causes them to behave a certain way? Is there some type of traditional influence or some cultural influences that are steering them in a direction to make a decision to purchase or use something? And how does that make them tick? And that fascination is what drives us to be on the multicultural side of things. But it’s a lot of work, but I think if you’re interested in learning about people or you have an interest in understanding people and the psychology that goes into consumer behavior, I really do think multicultural is the place to be.

Adrian Tennant: Hmm. That’s great advice, thank you. If listeners are interested in learning more about developing multicultural marketing strategies or your work at Rumbo, where can they find resources?

George Zwierko: Well, you could always start at our website, which is gorumbo.com. I think if you go online and just Google “multicultural marketing,” you get to see some amazing national international work. And then I know a lot of the universities are offering or beginning to offer classes on diversity inclusion, multicultural marketing. I think that’s becoming more relevant and at the university level just because we’re watching the landscape of this country completely change and just globally how we’re starting to become more interconnected. And the planet is much smaller than it used to be. 

Adrian Tennant: George, thank you very much for being with us today on IN CLEAR FOCUS and thank you for sharing your insights into this really dynamic market.

George Zwierko: Absolutely. It’s been my pleasure. This has been fantastic. Thank you for having me.

Adrian Tennant: My thanks to our guest this week, George Zwierko, Principal of Rumbo Marketing. You can find links to resources we discussed today on the IN CLEAR FOCUS page at bigeyeagency.com under “Insights.” Just click on the button marked, “Podcast.” Consider subscribing to the show on Apple Podcasts, Spotify, or your favorite podcast player, and if you have an Amazon Echo device, you can use the IN CLEAR FOCUS skill to add the podcast to your Flash Briefing. Thank you for listening to IN CLEAR FOCUS, produced by Bigeye. I’ve been your host, Adrian Tennant. Until next week, goodbye.

Bigeye’s Senior Strategist, Dana Cassell, joins us to examine the current state of grocery shopping and the ways they are innovating to engage with shoppers.

IN CLEAR FOCUS this week: the $800 billion grocery wars. Amazon announced this week that it is opening its first full-size, cashierless grocery store. Bigeye’s Senior Strategist, Dana Cassell, joins us to examine the current state of grocery shopping and key challenges facing the industry. We look at the ways traditional grocery chains are employing technology to engage with shoppers, experimenting with new store formats, and testing delivery options.

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Episode Transcript

Adrian Tennant: You’re listening to IN CLEAR FOCUS, a unique perspective on the business of advertising. Produced weekly by Bigeye. Hello, I’m your host Adrian Tennant, VP of Insights at Bigeye. An audience-focused, creative-driven, full-service advertising agency, we’re based in Orlando, Florida, but serve clients across the United States and beyond. Thank you for joining us. Today, we’re going to be talking about something we probably all have to do: grocery shopping. A five point 7 trillion dollar business globally, based on 2018 data from ProgressiveGrocer.com, the top grocery chain in the US is Walmart – and it’s way ahead – with $514.4 billion in sales. And the number two position is Kroger with $121.2 billion. In addition to its own name, Kroger operates under 16 store names including Harris Teeter, QFC, and Ralph’s. Coming in third is Albertsons with $62.2 billion. Florida-based Publix comes in fifth with $36.1 billion. The German-owned chain, Aldi, which also owns Trader Joe’s, comes in ninth with $16 billion, which is just ahead of Amazon, owner of Whole Foods; that’s in 10th spot with $15.8 billion in sales. A 2019 report from the Food Marketing Institute reported that 92% of shoppers have a favorite store where they do the bulk of their grocery shopping. This is a place they know by name and where they spend the majority of their grocery budget, most commonly a supermarket. Today, the vast majority of grocery shopping still takes place in traditional brick and mortar stores, but this pattern is beginning to change as more retailers offer grocery delivery options either via their own services or in partnership with companies like Instacart. The online grocery market generated sales of $28.7 billion in 2019 with sales forecast to reach $59.5 billion by 2023. The biggest players in this space are currently Walmart and Amazon. Of course, marketing plays a significant role in how supermarkets offline and online position themselves relative to competitors. The industry is also known for having razor-thin margins, so there is significant incentive to optimize every aspect of the marketing mix to maintain the most profitable formula. To talk about the current state of grocery shopping and some of the challenges facing the industry in 2020, I’m joined here in the studio today by Dana Cassell, Bigeye’s Senior Strategist. Welcome back to IN CLEAR FOCUS, Dana.

Dana Cassell: Thank you. Thanks for having me.

Adrian Tennant: So why are you interested in following grocery store marketing trends?

Dana Cassell: It’s really the combination of my personal and professional interests that make the Grocery Wars so interesting to me. There’s a lot in there about consumer behavior and experience. You mentioned the razor-thin margins in this vertical, so really experience and um, consumer behavior have to be optimized. So I just love that. Um, it’s a super competitive field and it combines food and local culture. So there’s always something regional about groceries and the way that regional grocers expand into new areas I find really fascinating. And then there’s also a fairly broad target as you mentioned in the intro. Everybody needs to grocery shop at some point. So I really am interested in the idea that it’s not a brand that can usually differentiate itself on its target. And then also just how much of our life grocery shopping takes up. An average household makes 1.6 trips to the grocery store every week, spending $113.50 every week. And then this part, this is what I get so excited about. The average household makes trips to 4.4 stores each month. So while someone might have their grocery of preference, they also probably have a place that they swing into that is more convenient, maybe a place where they buy produce or meat. And I just think that’s fascinating that really a mix of brands make up one category for a house. I just love it. This is an industry I really like to watch right.

Adrian Tennant: The buzz in Florida lately has been about the closing of many Lucky’s Market stores and also the news that Earth Fare, which is a health and wellness-focused supermarket chain, will be closing all of its stores. What’s the deal with these beloved brands going out of business?

Dana Cassell: So kind of two different stories actually for Lucky’s and Earth Fare, but we can talk through both of them. You might know that Lucky’s started in Boulder, Colorado in 2002 and their mission was to be organic for the masses. So they were trying to broaden access to organic food. And in 2012, they opened their second location in Colorado. And then there was a turning point for Lucky’s, which is that in 2016 it was invested in by Kroger. You mentioned earlier that Kroger has many stores under which it operates. Well, it invested heavily in Lucky’s in 2016. And at that point they had 17 stores in 13 States and Kroger started pushing Lucky’s to younger, more price-conscious shoppers. And then they made a strategic move into Florida. So in 2017, there were 11 Lucky’s in Florida. You can see how quickly the growth happened for this store. At the same time, though, we saw the growth of chains like Sprouts, Fresh Thyme and Earth Fare. And during that expansion, we also saw major brands like Walmart and Aldi start to double down on organic and natural foods. And even Kroger did. So the way they did it was with a private line in store, which is the way we see many major brands address natural and organic. So while Lucky’s was growing, the general market for organic was growing as well. And that message of organic food for the masses was not a point of difference any more because if Walmart has doubled down on organic, that’s a difficult place for Lucky’s to differentiate. So really, Lucky’s grew too quickly and then Kroger just decided to pull their funding. We know that Kroger is focusing on tech. It’s my assumption that the focus on tech leaves Kroger no option but to refine their strategy. So they’re really transitioning, transitioning to an omnichannel retailer, focused on store delivery, pickup and ship. And I think as this more strategic focus is happening, Lucky’s just is not a profitable element for the company. So I’m interested to see what happens with Lucky’s over time. I think the Kroger pulling out – obviously, it makes a major impact in this area of the country. And then Earth Fare is just a kind of a totally different story in and of itself. Earth Fare started in 1975 in Asheville, North Carolina. And their niche was organic natural foods and over time, as we just mentioned, that niche really disappeared. So grocers either have to compete on price or they have to compete on customer experience. Earth Fare was clearly too small to be able to gain the price advantage that larger retailers have. And while they invested heavily in local communities and had a really local feel for every store, the customer experience wasn’t enough to help the brand thrive. So their niche disappeared. Kind of two different stories for those two.

Adrian Tennant: Now, you mentioned Kroger pushing investment in technology. Is that a trend you expect to see across the industry?

Dana Cassell: Of course. You mentioned earlier about online grocery and the percent of sales that it’s taking. Absolutely. If a grocer wants to succeed, their online strategy has to be in place. I certainly expect to see that expand across the interest industry. I’m interested to see what Kroger does because of course their investment in technology impacts many of the stores that we all shop in, whether they’re named Kroger or not. But for sure we’ll see a technology push.

Adrian Tennant: And what other grocery trends are you looking towards in 2020?

Dana Cassell: Hmm, that’s a fun question. I see the trends break down into two different areas. They’re either experience or behavioral trends, or trends based on personal values. So the values trends that we’re looking toward in 2020 are things like plant-based foods and the availability of those in your average grocery store. The trend towards zero-waste cooking, and we’ll see that pop up in prepared foods as well. And then also this is one that we can be interested in as marketers: the story behind foods is a trend that we’re seeing – people really being interested in where their food comes from and how it’s grown and how it’s produced. My favorite current example of this is Vital Farms eggs. I also love that they’re a heavy podcast advertiser. So I love hearing about them just through my own media habits. But the way that they’re telling their story is they have the name of the farm where your eggs came from on the side of the carton. And you can go on their website, type the name of that farm, and they take you on a video tour of the farm. So you might have this image of dairy – of a beautiful farm, and a red barn, and sun shining on green grass. And that’s not true, as we know, in a lot of food production. And Vital Farms is not just dispelling that myth, but just saying, “Come take a look. Here’s the name of your farm, take a tour and see what it’s about.” So that storytelling behind foods I think will only be getting bigger. And then on the experience or behavioral side of trends, a few things that I’m interested in. Obviously, as technology grows and online ordering grows, grocers are able to have more access to habit tracking. So this is when you see, like in your grocery app, if you’re going to order for the week, you might see between when you finish your order and submit for payment, you might see a screen that says, “Did you forget your orange juice?” Because they notice that I’ve bought orange juice every week for the last three months and I didn’t this week. So that habit tracking is a way to optimize people’s experience. It’s also a way to optimize sales. We’ll also see a trend toward convenience foods. I think the first wave of this was really at home delivery and meal kits. And then groceries have gotten on board with this. So you can walk now into a Harris Teeter for example, and you’ll see meal kits prepared, ready to go home. So all of those herbs, chopped veggies, diced meat, prepared and you just need to go home, combine and cook. So we’ll see an increase in convenience store foods like that, but also things in more prepared foods like sandwiches over in the deli. You know, chicken ready to eat, to-go foods, those meal kits. We’ll see that growing this year. And then the delivery method is obviously an experience and trend that we’re looking toward and really living in right now. The different ways to get your groceries. If you’re going to come in store, we’re going to be focused on a speedy checkout process. You can order online, have it delivered home, or you can come drive up. We’re going to see groceries optimizing each one of those delivery methods.

Adrian Tennant: A couple of other tech innovations that I’ve been tracking: if you have a mobile phone app for the supermarket, it’s typically going to understand the layout of the store that you shop in most frequently and it can potentially guide you through the store to ensure that you get all of the items on your list in the most, time and footwear-efficient manner. But I’ve also seen things where, for example, freezer cabinets have got small cameras installed that look at the facial expressions of consumers as they approach the cabinet and might actually suggest products based on the emotion that’s being elicited by the facial characteristics of that moment. That’s a little Minority Report – but I know that Kroger is one of the supermarket chains that’s, I think, working with Microsoft on the idea that the shelf talker or the labeling along shelves can be personalized to the individual consumer. And even with the prospect of having personalized, dynamic pricing back to that loyalty scheme idea – so a lot happening in supermarkets, it seems, technology-wise.

Dana Cassell: It is interesting. On those digital tags. I also like the idea of the tags being able to talk to the phone. So as you pass by something being, you know, being reminded or if you have your list on your phone, the geo-locating in the store, I think it’s all really interesting. And as a consumer, I feel a couple of ways about it. You know, you just mentioned the Minority Report aspect, but also I’ve been in a store – I haven’t done this in grocery yet because I’m such an online order of grocery – but I was in Target recently and couldn’t figure out where something was in the store and went into the app and was able to find the aisle in the app. And I think that is super useful. So when you mentioned a phone being able to guide you through the store, especially if you’re new to an area or a new store is opened, you know, that you haven’t shopped in before. I think it’s gonna all optimize the consumer experience and at the same time deliver data to the brands that they can use to increase sales and you know, just make really the experience of shopping better.

Adrian Tennant: Now what are the lessons about consumer behavior marketers can learn from these Grocery Wars?

Dana Cassell: That’s really the question that gets into why I follow groceries in general because I just think that the trends that we see there can apply to a wide variety of brands. So the first is the digitally-demanding environment. Obviously we’re talking about this huge tech investment that grocers are leaning into right now and will continue to lean into. And the lesson that’s taught us is that stores have to have a promotional plan, a media plan, and an e-commerce plan in place, digitally. These are just the three baseline mandatories that we’re learning from grocery. A digitally-demanding environment means that you have to be up to speed. We also have in grocery the sea of sameness. You know, if you take a step back, they’re all selling food. They’re all in my neighborhood. So they have to figure out in this sea of sameness how to stay stand out. And I mentioned earlier two tactics that we see groceries use for that either price, competition or experience. And I’m really most interested as a marketer and the stores that choose the consumer experience as their point of difference. And we can learn a lot from that. I think, in general, there are four questions as a marketer that I would take away from the Grocery Wars and what we’re seeing here in early 2020 that I would encourage brands to ask themselves. And if we don’t have solid answers, you know it’s time to bring somebody else in the room that can help with these answers. So the first is, “what is our point of difference and how will we compete?” And then, “What technology do we need to invest in to meet our customer’s expectations?” I am so pleased that Kroger sees the need to do that rather than limp along with whatever technology they have. And we all know we’ve worked with brands day-in, day-out, that at this point have legacy technology infrastructure that has sort of been Frankensteined together to make things work. And sometimes there’s a moment where you have to pause and re-invest. So, “What technology do we need to invest in?” The next question is, “What’s the customer experience of doing business with our brand and is it exceptional at every touch point?” This is a hard one to answer if you are emotionally connected to your own brand. So I would encourage you to find somebody newer or less emotionally connected if it’s not exceptional at every touch point, what changes do you need to make? And then the last is, “Is our business model modern and evolved?” Meaning – is it values driven? We talked about people wanting to hear the story of their food. That question applies to all brands and that is not coming from one particular niche of consumers. As in the evolved business model, “Are we environmentally aware and do we have a customer-first mentality?” We’ve seen healthcare talk about a customer service mentality for over a decade. They’ll use the phrase, “Patient-first.” And I think we’re seeing grocer start to say, “Shopper-first mentality.” So these are kind of the lessons I think we can walk away with.

Adrian Tennant: Do you think we’re going to be looking at smaller footprints going forwards or do you think size still really kind of matters?

Dana Cassell: That’s really interesting. So we see Walmart’s Neighborhood Market being an answer to that. It’s a much smaller grocer that is only focusing on groceries. So all the things that you see at the Super Center are not there. And even Aldi, Lidl, Trader Joe’s, none of those are mega-footprint stores. I think you’re right. As online increases, I think the store experience is going to need to be optimized. And that does not necessarily mean a massive store that takes me an hour to get through. We saw that in the delivery trends for 2020, if we’re not doing drive up or delivery, speedy checkout is a big deal. And getting through the store quickly is too, so I expect that we’re not going to see an increase in mega-footprint grocery.

Adrian Tennant:

The average supermarket carries something like 36,000 to 40,000 SKUs compared to an Aldi or Trader Joe’s, which typically carries 3,000 to 4,000 max.

Dana Cassell: Right.

Adrian Tennant: Very different in terms of potentially being overwhelmed by the SKUs in a typical supermarket. But I believe most people probably only stick to 150 SKUs, habitually. So it seems like there’s a lot of choice out there. Do you think we need all of that choice, particularly with direct-to-consumer becoming a more viable option?

Dana Cassell: I think that’s interesting because I do think sometimes people find new brands to experiment with through their favorite grocery store. So I think it’s important that we continue to offer a variety. It’s a great place for trial. It’s obviously a wonderful channel for promotion as a marketer and the habit tracking. So the grocery delivers us a great experience as a marketer to say, people who like this, this, and this are typically buy this, this, and this tend to like our new product. So I really think that the in-grocery experience will continue to grow for trial brands, but certainly direct-to-consumer. I mean the world is our oyster with how we get our things. I also want to mention that the customer satisfaction score for Trader Joe’s in the latest survey, the 2018 one, it’s the number one highest grocery for customer satisfaction. So if a smaller grocer that has their own items, their own brands, it has is leading in customer satisfaction, I think that’s directional for where some of these larger grocers may be heading. Now obviously, two is Wegmans, three is Publix, and those are not smaller smaller footprints like Trader Joe’s. But that customer experience at Trader Joe’s just really turns the needle for them.

Adrian Tennant: Well it’s retail as theater, obviously and because they are their own branded products, there’s not really the ability to compare. And as you can probably tell, I’m a bit of a Trader Joe’s fan.

Dana Cassell: Right.

Adrian Tennant: And I’m not alone.

Dana Cassell: No!

Adrian Tennant: One of the top rated podcasts on Apple Podcasts is called, “Inside Trader Joe’s,” – it actually topped the charts a couple of times. So people are pretty passionate about their supermarkets.

Dana Cassell: No doubt.

Adrian Tennant: Great points. Dana, thank you so much for joining us today to discuss the Grocery Wars. It’s a fascinating topic for marketers.

Dana Cassell: Thank you for having me.

Adrian Tennant: My thanks to our guest this week, Dana Cassell, Senior Strategist at Bigeye. You can find links to resources we discussed today on the IN CLEAR FOCUS page at bigeyeagency.com under “Insights.” Just click on the button marked, “Podcast.” Consider subscribing to the show on Apple Podcasts, Spotify, or your favorite podcast player. And please rate and review the show. And if you have an Amazon Echo device, you can use the IN CLEAR FOCUS skill to add the podcast to your Flash Briefing. Thank you for listening to IN CLEAR FOCUS, produced by Bigeye. I’ve been your host, Adrian Tennant. Until next week, goodbye.

Virna Sekuj, Strategic Insights Manager at GlobalWebIndex, joins IN CLEAR FOCUS to discuss digital consumerism and evolving attitudes towards personal data.

IN CLEAR FOCUS this week: as new research reveals consumers’ growing desire to be compensated for sharing their personal data, we evaluate the viability of the business model that underpins the Internet. Virna Sekuj, Strategic Insights Manager at GlobalWebIndex, joins us to discuss digital consumerism. We learn how evolving attitudes towards personal data are raising privacy concerns and why the premiumization of in-real-life experiences is a growing trend.

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Episode Transcript

Adrian Tennant: You’re listening to IN CLEAR FOCUS, a unique perspective on the business of advertising produced weekly by Bigeye. Hello, I’m your host Adrian Tennant, VP of Insights at Bigeye. An audience-focused, creative-driven, full-service advertising agency. We’re based in Orlando, Florida, but serve clients across the United States and beyond. Today we’re going to be talking about digital consumerism, our evolving attitudes towards personal data, privacy and the premiumization of in-real-life versus digital experiences. These are themes highlighted in new research from GlobalWebIndex. An international market research company established in London in 2009, GlobalWebIndex now has offices in Prague, Athens, and New York City, which is where our guest today, Virna Sekoj, is based. Virna is the Strategic Insights Manager for the Americas and uses GlobalWebIndex data to help clients with strategic business goals and decisions. Additionally, Virna contributes to GlobalWebIndex reports, infographics, thought leadership, blog series, press interviews and podcasts – like this one. Virna’s interests include consumer psychology, gender representation in media, and the relationship between society and technology. Welcome to IN CLEAR FOCUS, Virna.

Virna Sekuj: Thank you. It’s great to be here.

Adrian Tennant: Before diving into the topics I mentioned in the intro, could you first explain the research methodology that GlobalWebIndex uses?

Virna Sekuj: Sure. So as you mentioned, we’re an international digitally-focused market research company. We are the world’s largest study into what we call the connected consumer. So essentially internet users all around the world and we conduct our core survey across 46 different countries, soon to be 47. And our objective really is to provide a full 360-degree view of the digital consumer and their lives online. And we do this by covering all sorts of different data points on topics that range from attitudes and lifestyle, media consumption, brand engagement, how people are interacting with brands, online marketing touchpoints, and everything in between.

Adrian Tennant: Perfect. In your report, “Decoding the data economy,” you make it clear that you believe the business model that underpins the Internet is really being challenged. What led you to that assertion?

Virna Sekuj: Yeah, so probably the most popular business model that really underpins the Internet now is this idea of free services that are funded by advertising revenue. And advertisers ultimately get value out of this because they’re able to tap into the personal data of users who were on these free services and free websites. So if you think about all of the social media platforms we use: Facebook, and Twitter, and Instagram, and everything, we as consumers get to take advantage of all of the functionality that they provide to us and all of the amazing features. We can stay connected to other people and consume content and all these types of things without actually giving the providers our money. But they have to make money somehow, right? And it’s actually based off of our data. So the exchange is that we give them access to all of this data that we produce our data footprint online and on social media. And they’re able to sell it to their advertisers who can then use it to better target us at different touchpoints in our whole online journey and our purchase journey with personalized ads. So this has been really successful for a pretty long time now and it’s allowed for all of these free services, these great services that we use to grow pretty rapidly. But that’s being challenged now particularly. And there are a few reasons why. So first of all, I think a lot of people are probably aware of some of the scandals we’ve seen in recent years around data breaches or fake news and Cambridge Analytica and all of these companies that are really in the limelight for not properly protecting consumer data. So there’s a lot of attention on that and there’s also the legislation side of it. So the legislation and the governments are starting to catch up with where technology has been for a while and things like GDPR, or the California Consumer Privacy Act are starting to really put some accountability on service providers to how they protect and store and track our data. So it’s really coming to the forefront of consumers’ minds and they’re starting to become more aware of it, more concerned about it, and are starting to challenge this model that has been very functional and successful for a long time.

Adrian Tennant: We’ve talked about this phenomenon on IN CLEAR FOCUS before – that is, that consumers often say that the really concerned about personal data privacy in the abstract, but then the actual digital behavior sometimes suggests otherwise. And you’ve coined a phrase for this, you call it, “The Privacy Paradox,” which I really like. What kinds of consumer behaviors exemplify this paradox?

Virna Sekuj: I think when people are faced with this idea of privacy and data protection in an abstract, they’re very pro-protection and very conscious of it. But then when it comes to their actual behaviors, they’re less likely to be going out of their way to do things that would, in the long run, protect their own data. So some of the things that we track in our global research are very high-level attitudes towards privacy. Like agreeing with the statement, “I’m concerned about the internet eroding my personal privacy.” So when you ask, “Do you feel this way? Do you agree with this?” we get really high levels of agreement. It’s something like two-thirds of people around the world, say that they’re concerned about the internet eroding their personal privacy. But then when you start to look at what people are actually doing to protect their privacy and whether they’re willing to give up a level of convenience or whether they’re willing to pay for services in order to not have their data tracked, there’s not the willingness to actually follow through. So people want the convenient use of social media. They don’t want to have to pay for things like that. They like having brands give them personalized recommendations off of what they might like based off of their internet history or what else they’ve purchased and all of these things. You have to give up a certain level of convenience and ease and I guess the quality of using internet services in order to really maintain an ironclad grip on your own data privacy, which people are not as willing to do.

Adrian Tennant: What types of personal data collection and use typically make consumers most nervous do you find?

Virna Sekuj: Yeah, so all data is not created equal is what we like to say. There is definitely a spectrum of sensitivities as to what different kinds of data people are pretty comfortable sharing versus what they’re really not comfortable sharing. And this is important for brands that operate online and especially those that are considering tapping into trends like data monetization or asking people to provide their data in exchange for different types of access to goods or services or even money. And what we found in our research is that things like your location, your address, your mood, even to the extent of things that you’ve bought online are pretty safe areas of data. People are fairly comfortable giving away some of that, but what is probably the most highly sensitive is anything related to health or medical records – anything related to financial data, income, household spending is quite sensitive. And then browsing history is really sensitive so people are not willing to share data like that in many cases.

Adrian Tennant: Now in the report you write about the widening gap between data collection and management players within the digital ecosystem and the consumers whose data it is that’s being brokered. To what extent do you think consumers feel a loss of control over their personal data?

Virna Sekuj: I think it’s definitely growing, this idea of having a loss of control. So a lot of the research that we’ve done into data privacy and protection has been specific to the US and the UK and one of the big stats from the report that you’ve referenced a couple of times especially is that around 40% of internet users in these two markets say that they don’t feel in control of their personal data anymore which is pretty significant. And I would even argue that that’s a little conservative because, at the end of the day, I think as much as even some of us who work in the data space feel like we have a little bit more knowledge or a little bit more awareness, ultimately no one’s really that much in control and that’s kind of part of the problem.

Adrian Tennant: Hmm. That’s fascinating to me. I mean, you had mentioned obviously GDPR in Europe and the California Consumer Privacy Act, that one went into action just at the beginning of this year.

Virna Sekuj: Mmmm.

Adrian Tennant: Obviously the objective of these regulations is to give consumers the right to protect their data and personal information online. In what kinds of ways do you think the introduction of these regulations have maybe affected consumers’ behaviors or attitudes?

Virna Sekuj: Yeah, so at the moment, I think that the probably most positive impact they’re having is on businesses and companies that operate in the data space. So they’ve introduced a lot more accountability and transparency. And a need for just better protections around how consumer data is stored and gathered when it’s deleted. All of these types of things, which ultimately protects consumers in a way that previously they hadn’t been. For consumers themselves, I think it’s brought the issue more to light and people are becoming more aware and a bit more suspicious and may be careful about what they think about when they want to share data. But generally, the picture is still quite complicated and confusing for people. You’re seeing more and more of these opt-in messages that come from whatever website or app that you’re using and people don’t really know what to do, sometimes. There’s this massive list of terms and conditions that nobody really reads. And it just adds to this whole environment of uncertainty around, “Who has my data? Oh, did I opt into that? Do I have any rights around this?” So the framework isn’t entirely clear yet. It’s becoming better but there is this kind of muddy waters for people to work through at this point.

Adrian Tennant: As you mentioned in the report, Governor Gavin Newsome has proposed the Data Dividend for Californians, a bill that would mandate tech companies to pay users for their digital data. In what kinds of ways are companies rewarding consumers for use of their personal data right now?

Virna Sekuj: There’s a couple of early examples, almost experimental ways that companies have started to do this. I think the Amazon one from last year is a good one. So they tried to see if people would sell their data by offering a $10 credit during Amazon Prime Day last year if they let some of their behaviors and browsing behaviors be tracked, essentially. So that was very obvious, “Here is a certain amount of money for us to be able to access your data.” Facebook has been doing this on some level in order to test how users who are on Facebook use other competitive services too. So they have apps that pay users to basically allow Facebook to track how they use other apps and competitors’ sites. This has been a bit contentious though and I know that Apple doesn’t allow these types of apps to be downloaded and used on their devices because it violates Apple’s terms for one app collecting data on another app. So it’s been complicated but we’re starting to see experimental efforts by companies to tap into data monetization. And as people become more aware that their data has value and they’re not necessarily the ones benefiting from this value, it’s going to become a more and more common occurrence.

Adrian Tennant: So your feeling is that we might well say the introduction of products that help consumers take back control of their data. What could such solutions look like, do you think?

Virna Sekuj: Yeah, it’s definitely going to be an interesting sub-industry that comes out of the whole data economy. You can’t necessarily control your data as well as you would like to or you don’t have the time or the expertise to read all of these legal documents and opt-out of this and opt out of that. So for a fee, a service provider will probably help you navigate the whole world of T’s and C’s and data sharing and which websites you should trust. And can you delete your data and they’ll be able to help people get rid of their data footprint and remove some of the personal information that they have just floating out there on the internet that doesn’t necessarily need to be out there. So we’re in this data economy but we’re just at the beginning of it. This whole industry of data monitoring as you kind of hinted too, data management for the user is probably one of the next waves that are going to crop up because it’s just become so complicated for the average internet user to really manage their data footprint. And people are becoming, as I said, more aware of it and more concerned and they probably will be willing to pay for something like that in the future.

Adrian Tennant: It’s a fascinating prospect.

Virna Sekuj: Mmm.

Adrian Tennant: I want to turn now to the recent report entitled, “Connecting the Dots,” in which several contributors at GlobalWebIndex predict consumer trends that will shape 2020 and beyond. This is a very thoroughly researched report and it is also a great read. And Virna, your section is entitled, “Can I speak to a human please?”

Virna Sekuj: Yes.

Adrian Tennant: What data points led you to write this piece?

Virna Sekuj: So this is an interesting one and it’s probably one of my favorites, just like topics that people are discussing this year. And what led us to look at this as a theme was some of the trending data that we have tracked for a number of years and the changes that we’ve seen in it. So we’ve tracked in our global survey user attitudes towards technology and the internet for a while now. And one of the trends that we’ve started to see is that there’s a growing discomfort or uneasiness with how much technology has really permeated into our lives. So agreement with certain attitudes like, “Technology makes life more complicated,” has grown, for example, by about 27% between 2014 and 2019. So essentially, people are more than a quarter more likely now versus five or six years ago to say that they think technology is making their lives more complicated. But at the same time, people are more connected than ever before, which is another data point we track. So people feel like they’re constantly connected, that’s growing, but at the same time there’s this increasing rate of uneasiness with it. So technology is everywhere. We use it for everything. It’s part of our lives and like there’s a resistance towards that. So it’s a bit of a cycle. And it’s interesting that that’s really kind of coming to a head now.

Adrian Tennant: You also identify an emerging trend in the premiumization of in-real-life experiences in contrast to technology-driven experiences. Can you explain that?

Virna Sekuj: Sure. So as I said, technology has really permeated like every aspect of our lives now, right? So it’s not just in how we work or you know, how we go to school and how we communicate, but it’s becoming more and more a part of things like healthcare. It’s a part of our transportation systems, our entertainment, everything. So many of our experiences really are just mediated by screens and there’s a reason for that. So technology not only makes things more convenient and more efficient, but it makes things a lot cheaper as well. So it’s cheaper to put in a bunch of self-service kiosks in a grocery store, for example, in the long-run versus pay human workers and give benefits to human workers and train them up. It’s cheaper to put in e-learning systems and laptops in every classroom and only have one teacher oversee a whole group of students versus just have more staff and more one-on-one learning experiences. And technology as well is cheaper now than it ever has been before. So if you look at how much a computer cost 30 years ago, it’s just an astronomical difference. Versus now when everybody in developed, mature markets essentially – no matter your income levels – will have a smartphone. It’s just like it’s mass culture. So what is the more expensive and difficult thing to get at is to have a person work with you one-on-one: a person actually provide a service or enhance an experience for you and give you that personalized, one-on-one attention or to get something that’s handmade and slightly imperfect because it didn’t go through a whole automated, mechanized mass production system. So what is becoming more exclusive and difficult to get because it’s inevitably more expensive is having that human contact and the human element in all of our services and experiences. And that’s driving this whole idea that the human touch, the human element is becoming more of a premium.

Adrian Tennant: Hmm. Now, in the report, you discuss some of the ways that technology itself is becoming more human, like replacing jobs and services previously performed by humans. You also cite research from Capgemini that suggests consumers are about as likely to trust product recommendations from voice assistants as they are to trust human salespeople. So what does the rapid adoption of voice assistants on mobile phones and dedicated smart speakers tell us?

Virna Sekuj: Yeah, voice is really interesting. It’s one of the device trends that we’ve seen grow so rapidly over the past few years and a lot of it is driven by younger internet users who are very, very comfortable using voice and automated services and bots and all of these things. So much so that I think it’s a little bit worrying how comfortable people have become, especially younger people with interacting with technology over perhaps interacting with a person. And that really points to a lot of potential questions in the future as to how adept or comfortable are people going to with picking up a phone and speaking to someone in an unprepared way or advocating for themselves to an actual human when they have to like look for healthcare solutions or something. Expecting the unexpected when you talk to a human is something that you don’t really get when you’re used to voice assistants and bots and all of these types of things. So there are a lot of questions and implications around – will people be able to do that? Are they going to be prepared for human-to-human interaction? And are there going to be implications around social anxiety and discomfort and all of these types of things when dealing with the basic, everyday function of just talking to people? Are we getting too comfortable just to go to voice bots and chatbots for everything?

Adrian Tennant: In an increasingly digital world then, you believe we’ll see human interaction become more of a premium commodity. And what kinds of implications will this have for commerce?

Virna Sekuj: Yeah, so everything about commerce is going online or becoming automated in some way because that’s just the easier, more efficient, cheaper way to do it. But I think this whole concept, that human interaction and the human element is going to become more of a premium, has a lot of implications for brands that want to differentiate themselves and position themselves potentially as luxury or as a bit more up-market and upscale. And there are other people and analysts that have been predicting that the future of the luxury industry is really going to be shaped by how much of this human element they can integrate into commerce and experiences and provide things that are a bit more back to basics. So luxury is not necessarily going to be shaped by how beautiful or expensive or exclusive these material things are as it typically has been – although that’s always going to be an element to it – but how humanized, how unique, how much one-on-one attention you’ll be able to get is going to be part of what makes something luxury. And brands that want to kind of integrate that whole element into their positioning and into how they speak to consumers and how they offer something that’s different I think can tap into that and be really successful with it.

Adrian Tennant: Hmm. It’s a fascinating hypothesis. Thank you.

Virna Sekuj: Yeah.

Adrian Tennant: Virna. We have a very active and engaged internship program here at Bigeye. Could you tell us a little bit about how you came to be working in research?

Virna Sekuj: Yeah, of course. Um, so I’ve been working in research pretty much my whole career. Um, I started off doing a research assistant job when I was in college. Um, and I studied Sociology because I had a real curiosity and interest in human behavior and what drives people to make the decisions that they do and how our collectivist society impacts everything. So I was a natural person to flow into research. I’m a very analyst-focused kind of mentality and I think that for anybody who has similar interests, it’s a good place to be because there is a need for analysts and researchers right now. As we talked a lot about the data-driven economy, everything is going to be around data. All of the decisions that businesses make now are fueled by some sort of analytics, so it’s a good place to be, I think.

Adrian Tennant: It also speaks to the fact that you still need human beings to really interpret data sets and to find meaning. 

Virna Sekuj: Exactly. Yeah. You have to be able to make connections and tell the story from the data and fortunately, computers are not there yet. So you definitely need to have both a creative and technical skillset I think to be really successful in insights.

Adrian Tennant: Great points Virna. Thank you. If listeners are interested in learning more about GlobalWebIndex or your reports that we discussed today, where can they find resources?

Virna Sekuj: So you can check out our website, GlobalWebIndex.com where a lot of our case studies and reports are shared or follow us on LinkedIn, Twitter and Instagram. And a lot of the new content that we produce is updated there as well.

Adrian Tennant: Perfect. Thank you very much for being on IN CLEAR FOCUS, Virna. 

Virna Sekuj: Yeah, thanks so much for having me. It was great to chat.

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Adrian Tennant: My thanks to our guest this week, Virna Sekuj, Strategic Insights Manager for the Americas at GlobalWebIndex. You can find links to the resources we discussed today on the IN CLEAR FOCUS page at bigeyeagency.com under “Insights.” Just click on the button marked “Podcast.” Consider subscribing to the show on Apple Podcasts, Spotify, or your favorite podcast player. And please rate and review the show. And if you have an Amazon Echo device, you can use the IN CLEAR FOCUS skill to add the podcast to your Flash Briefing. Thank you for listening to IN CLEAR FOCUS produced by Bigeye. I’ve been your host, Adrian Tennant. Until next week, goodbye.

Dana Cassell, Bigeye’s Senior Strategist, explores ten drivers of marketing effectiveness and how to maximize ROI on this week’s IN CLEAR FOCUS.

IN CLEAR FOCUS this week: evidence-based measurement of marketing effectiveness. Bigeye’s Senior Strategist, Dana Cassell, joins us to discuss a novel meta-analysis of almost 6,000 award-winning campaigns and their ROI. Conducted by advertising strategist Mark Ritson, the research study identifies ten drivers of marketing effectiveness.

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Episode Transcript

Adrian Tennant: You’re listening to IN CLEAR FOCUS, a unique perspective on the business of advertising, produced weekly by Bigeye. Hello. I’m your host, Adrian Tennant, VP of Insights at Bigeye. An audience-focused, creative-driven, full-service advertising agency. We’re based in Orlando, Florida, but serve clients across the United States and beyond. Thank you for joining us. Last November, ThinkTV – a marketing and research association dedicated to commercial television in Canada – held an event examining the relationships between media marketing and effectiveness. In his keynote presentation, advertising industry maven and educator Mark Ritson presented practical recommendations applicable to brand strategy, media, channel planning, and creative content. Prior to the event, Ritson had enlisted the help of a team of MBA students to conduct a meta analysis of almost 6,000 entries to the Effie awards. The Effie awards were originally launched in 1968 by the New York chapter of the American Marketing Association as an awards program to honor the most effective advertising efforts. The award now honors all forms of effective marketing with a network that spans the globe and provides insights into effective marketing strategy. Ritson and his team coded the material, featured in the Effie case studies and mapped the information against the results generated by the strategies described. The process yielded an overall Effie score for each submission that could be translated into a proxy of effectiveness. The research team found a consistent correlation between the brands with the highest scores and their return on investment. Based on the Effies research, Ritson identified 10 leading drivers of marketing effectiveness. To talk about marketing effectiveness, I’m joined here in the studio by Dana Cassell, Bigeye’s Senior Strategist. Welcome back to IN CLEAR FOCUS, Dana.

Dana Cassell: Thanks. I’m so glad to be here.

Adrian Tennant: So Dana, working with clients, how do you typically define marketing effectiveness?

Dana Cassell: Marketing effectiveness for our clients is about the extent to which our marketing efforts meet the strategic goals that we set with our clients before we engage with them.

Adrian Tennant: Perfect. So let’s dive into the first of those ten drivers, which is brand size.

Dana Cassell: Yeah, brand size. This came right out of this study.  so the correlation between the scores and the effectiveness, and this is really the idea that bigger brands have an unfair advantage.  brands that are currently bigger at the time of their campaign because they have a larger share of or a larger share of shelf. So this is kind of an unfair advantage for a challenge your brand or a new brand. If you’ve been around a while, you’re a more established brand, it is more likely that you’ll have a higher score for effectiveness just to that it’s due to the size of the brand. But luckily for other brands that aren’t naturally huge, other factors come into play like creativity. Adrian?

Adrian Tennant: Yeah, we talked about this in the first episode of IN CLEAR FOCUS earlier this year. Exceptional creative can help brands big or small make an outsized impact. Ritson cited research by Nielsen Catalina Solutions which attributed 47% of sales contribution delivered by 500 campaigns to creativity. The only other individual factor to come close in terms of impact was reach, which was found to contribute 22% of campaign effectiveness. If we think about the differences between brand building campaigns and those focused on short-term activation, it’s those brand building campaigns – those without a specific offer or promotion attached to them – that also tend to offer more creative opportunities for storytelling. So talk to us a little bit about brand codes, Dana

Dana Cassell: Brand codes. The data nerd in me loves the idea of brand coding. And in this study we’re talking about how a wide range of assets in a campaign like logos or taglines, font, graphics can be codified and measured for effectiveness. The quote from the study that I love is that, “you really can’t over-codify a brand’s touchpoints.” He challenges us to try it. We’ll only make money. So it’s codifying is all about making a brand or a product distinct from its competition by testing the value of different pieces of its assets. And often he notes marketers or people on the client marketing team can get touchy about this because we’re so close to the development of all of these pieces and we can become over-attached to the way they are in their current state. So brand coding helps us to remove some of our personal feelings and attachments from these elements of the brand and really understand what are the most effective manifestations of those brands over time.

Adrian Tennant: And am I right in thinking that consistency is going to be a key with that brand coding?

Dana Cassell: Consistently coding pieces of the brand? Sure. Absolutely. In all measurement, that’s important. And as we code something we can learn about that element. For instance, the logo and over time we can even break the logo into additional codes. So once we find a little data point that seems to have some juice in it, we can keep breaking it down. So I think this is what he mentions. There’s not really an opportunity to over-code. We can find what’s happening and then dig deeper, dig deeper, right-size that for the moment and then move on. And of course as time passes, as you know, consumer trends and behaviors do too. So we can code over time and find new changes. It’s a nice way for me to remove the emotion from the creative pieces of the brand. So what did you learn from this study about long- and short-form communication?

Adrian Tennant: You know this was really interesting. Ritson calculated the payback from longer-running campaigns compared to shorter ones. He found that there is a correlation between the number of weeks and months a campaign runs and its Effie score. So a focus on short- term activation, which if you think about it is what most performance marketing in the digital space is typically focused on –  he found it can have a detrimental effect on long-term brand building, which is all about building associative memories. so Dana, I know you and I love to talk about the Grocery Wars. If you’re located here in the Southeastern United States and think of the Publix Supermarkets TV spots around the holidays, you know, strategically, those are 100% brand building designed to evoke, feel-good emotions. Two of the best-known researchers in the field of marketing effectiveness, specifically from advertising, both of which happen to be from the UK, are Les Binet and Peter Field. In their analysis, they recommend that 60% of marketing resources should go to long-term brand building and 40% to short-term activation. So the practical issue for many of us is that business cycles are often shorter than these findings suggest would be optimal. And the Binet and Field 60/40 rule, you know, requires some flexibility. Thinking about the channel mix is an important part of that.

Dana Cassell: Yeah. One element of this study that I found interesting is the concept of balancing mass and targeted marketing. So obviously this is a debate, well, well discussed in our field, whether mass or targeted marketing is the right approach for marketers. So essentially, before 2011, segmentation and targeting were dominating. And then we’ve had a shift toward an overall balanced approach becoming more and more common. And I think what’s important here is understanding what mass means for your brand. The learning from the Effie study is that rather than taking an either or mindset, both strategies are required for success. So targeting can be useful for performance marketing campaigns with short-term impact. Mass is obviously helpful for brand awareness, broader audiences, long-term brand building. But knowing what’s mass for your brand in, in your space is important. We wouldn’t want to dilute our targeted efforts by trying to go too broad and mass media. So when we bring this strategy in-house to balance mass and targeted for our clients, sometimes we have to narrow our focus on what types of media, geographies, and reach could be considered mass for our clients so that we can get this healthy mix where one does not cannibalize the other. And that segues into another piece of this study, which is the idea of the multichannel mix. What media are the most effective for advertising campaigns? And the Effies DataBank pointed to a simple fact: the more channels we add into the campaign, the more effective that work is likely to be. Of course, we have to balance, reach and frequency. We can’t add too many channels and dilute our message. So again, just like that mass and targeted approach, when we internalize a multichannel mix for our clients, we have to measure the effectiveness of adding another medium one at a time to make sure that we have the budget to support that. And that throwing dollars into a new media doesn’t cannibalize one of the existing media that we’re working with. So I think that balance, you know, is fascinating. During the study they point to an ROI index by media platforms and it’s just an upward drive from one platform all the way up to five. We just see the needle growing on effectiveness.  literally the data points to the more media you’re using, the more effective your campaign will be.

Adrian Tennant: Hmm. That’s interesting. So is it still a reach and frequency model underlying?

Dana Cassell: It is a reach and frequency model of course, which is why I think that the mass and targeted versus multichannel, this is what ties it together. We can’t say reach is King or frequency is King. It’s the balance. And that’s a nuance. It’s a reason that it’s important to have a team, a client agency team working together that really understands their strategic goals of the organization so that we don’t just let the philosophy of a mass approach drive that we understand the strategic goals and we can use a mass and targeted approach. And a multichannel approach that makes sense for our budget and reaches our strategic goals. So these are kind of some of the more interesting points. Speaking from the strategic side of the house, I never wanna ignore the creative. There’s clearly, you know, an emphasis here on how we’re buying our media, but it’s important that beautiful creative, compelling media as part of this. So as we’re using beautiful creative on all these multichannel platforms, how are we telling the story of our brand? Obviously it’s something that marketers are focusing on and how are we differentiating our brands and our products from our competitors? This report talks about realistically differentiating your brand and what kind of impact that makes on a marketing campaign. What did you learn about a realistic differentiation through this Effie study?

Adrian Tennant: Yeah, that actually achieving brand differentiation once again corresponded with a strong Effie score.

Dana Cassell: Hmmm.

Adrian Tennant: But Ritson does point out that the concept of differentiation is potentially a bit of a slippery slope.  and he also mentioned, you know, professor Byron Sharp’s research which is summarized in the book, “How Brands Grow.” The book was published back in 2011 but it’s still very relevant to today. The book is based on work done at the Ehrenberg-Bass Institute of South Australia and it’s really a manifesto for evidence-based marketing. That is what actually works in practice rather than what should work based on somebody’s marketing theory. And Ritson and Sharp both seem to agree here that brands are actually pretty small considerations in most consumers’ lives. So differentiation is achieved through salience, first of all, that is whether a brand, you know, immediately comes to mind when a customer is in a buying situation. Second of all, understanding the competition and using that knowledge to stand out in whatever modest way is obtainable in practice. And third, through brand associations, because no brands live on an Island.

Dana Cassell: Sure. I can see how codifying and differentiation are correlated.

Adrian Tennant: So Dana, I feel like the next point was made for you the importance of setting meaningful and strategic objectives.

Dana Cassell: Isn’t that beautiful? It’s the last one in my list and something I’m thrilled to discuss.  setting between two to five strategic objectives led to strong performance on the Effie score spectrum. And as a strategist, of course, I’m thrilled that it’s included in the list. More than that, I’m thrilled that the data points to it needing to be included in the list. So even in the papers that were written as Effie submissions, the research team found relatively few campaigns laid out true strategic aims. That is disappointing but not necessarily surprising to me because I think we go really quickly – we have a tendency in our industry to go really quickly into tactical goals as opposed to two strategic goals. So one example of this is an actual example from the 2017 Effies awards is the Australian Dares iced coffee case study. And  it won a grand Effie that year and they did set out a strategic goal. And their strategic goal was to increase consideration of the brand among blue collar workers from 15 to 65% in a five-year span. And I went into a rabbit hole of watching the ads that were created from this campaign. And I would encourage you to do the same. They have this campaign that talks about their iced coffee being the choice when your head is all over the place or when you’re places all over your head depending on how the campaign is running at the time.  and they were making a move to help this iced coffee become a habitual choice for when consumers aren’t thinking straight. So the blue collar set, you know, there’s obviously that’s a great market that they’re trying to expand into and they achieved that strategic goal over time. They had a 300% increase in sales in five years following this campaign. And it’s interesting to find they have eight products as of now here in 2020. They only have eight products. They have really simple packaging and they positioned cold-brew as fancy, which I think is really amazing way to differentiate that brand from other large coffee brands.  there’s no snobbery about their iced coffee and I love that they had this strategic objective to kind of speak to the everyman, the average consumer, to find a new market. So it’s beautiful as a strategist for me to see that it’s included. It was lovely to watch a case study of a brand, find a way to become the leading brand in their category through strategic differentiation.

Adrian Tennant: Fantastic. And I should say, we will include of course, links to all of these resources that we discuss on the “Insights” page.

Dana Cassell: Enjoy it, enjoy seeing a dog in a baby bjorn. So just you have that to look forward to.

Adrian Tennant: Okay. I’m there.

Dana Cassell: Yeah. So strategy was the perfect gift to deliver in my lap. I think our last point of the conversation is perfect for you. How knowing how much research to do can, can impact effectiveness.

Adrian Tennant: Yeah. Well of course I was delighted, but not surprised, that research is identified as a driver of marketing effectiveness. Ritson’s presentation underscored the value of the approach we take here at Bigeye – you know, that is that research is absolutely vital in making sure the foundational basis of a campaign is sound. We know that research is key to unlocking the right audience targeting, brand positioning, and establishing the optimal balance of long and short term campaigns. Enough said. So Dana, what’s your take on Ritson’s research methodology?

Dana Cassell: I love the concept of trying to figure out the common ground between campaigns from different parts of the world with different objective strategies, products, brands business motivations. Finding common ground in a set this big – 6,000 entries – is a huge undertaking. And I think in the industry we have a lot to learn when someone sets about to do this kind of research. There are obviously downsides to it. I think the first point we made was brand size impacts effectiveness. That’s kind of a wah-wah. Like, well, what if I’m not a big brand? There’s a whole piece of this research that doesn’t apply. Share of voice share shelf is another, you know, it’s something that’s hard to apply to myself if I’m not the leading huge brand in my category. So there’s pieces of this methodology that I think are difficult, but  in an overarching way, I love to see the common ground between those 6,000 entries, all of whom believe that they have a campaign that is, has produced enough effective result for their client that they’re worth examining for an award. An award driven on effectiveness obviously captures the heart of a strategist.

Adrian Tennant: Yeah.

Dana Cassell: What did you think about the findings in the study?

Adrian Tennant: I think for me what was really interesting was that we have perhaps a sense of some of these things being important, but rarely do we have access to empirical evidence. That is the case. I mean, we see our statistics from the campaigns that we run. But oftentimes it’s very hard when you’re working with a client who has maybe worked with a number of advertising agencies over the year to really compare apples to apples. For me obviously the big part was of course learning that research is fundamental, but also understanding the nuances of long-term versus short-term campaign thinking.  and to your point, you know, brands that are already famous tend to stay famous, but that isn’t to say that a smaller brand can’t compete and find a niche for itself and then follow the same rules as the bigger brands to develop their own degree of fame.

Dana Cassell: Sure.

Adrian Tennant: Dana, thank you very much for joining us again today.

Dana Cassell: Thanks for having me. Anytime you want to talk about strategy and research, Adrian.

Adrian Tennant: Of course! My thanks to Dana Cassell, Senior Strategist at Bigeye. You can find links to the resources we discussed on the IN CLEAR FOCUS page at bigeyeagency.com under “Insights.” And please consider subscribing to the show on Apple Podcasts, Spotify, or your favorite podcast player. And if you have an Amazon Echo device, you can use the IN CLEAR FOCUS skill to add the podcast to your Flash Briefing. Thank you again for listening to IN CLEAR FOCUS produced by Bigeye. I’ve been your host, Adrian Tennant. Until next week, goodbye.

 

Learn about brand safety and online advertising from Jonathan Marciano of ad verification service CHEQ on this week’s episode of IN CLEAR FOCUS.

IN CLEAR FOCUS this week: brand safety and online advertising. Jonathan Marciano of online ad verification service CHEQ discusses the challenges of bringing full transparency to the digital advertising ecosystem. We discuss some of the unintended consequences of keyword blacklists that negatively impact publishers and consumers, and Jonathan explains how artificial intelligence is being used to improve brand safety solutions.

https://oembed.libsyn.com/embed?item_id=13046795

Episode Transcript

Adrian Tennant: You’re listening to IN CLEAR FOCUS: A unique perspective on the business of advertising. Produced weekly by Bigeye. Hello, I’m your host, Adrian Tennant, VP of Insights at Bigeye. An audience-focused, creative-driven, full-service advertising agency, we’re based in Orlando, Florida, but serve clients across the United States and beyond. Thank you for joining us. Today, we’re going to be talking about brand safety online. In July of 2017, consumer packaged goods giant Procter & Gamble announced that it had cut back its expenditure on digital advertising by $140 million due to concerns about where ads for its brands were appearing. In explaining its decision, P&G said that it had decided to restrict spending in digital forums where it felt its ads were not being placed according to P&G’s brand standards. Earlier that year, P&G had pulled its advertising from YouTube completely after discovering that ads bought programmatically – that is, via an automated system – had too often appeared next to offensive material, such as hate speech. The industry term for this is negative ad adjacency. In April of last year, 2019, Procter & Gamble’s Chief Brand Officer Marc Pritchard issued a call to entirely reinvent the digital media supply chain. In order to understand why brand safety is a concern, and why attempts to bring transparency to the current ecosystem have trouble keeping pace with its rapid growth, we need to recap the way digital advertising works today. At the top of the supply chain are the marketers for brands that want to reach prospective customers. They have marketing budgets, a portion of which goes to advertising. The brands work with advertising agencies like Bigeye, and we develop the creative – the ads themselves – and plan where the ads will be shown – the media. We then work with a number of third parties, purchasing the inventory or ad space on networks of websites. And these sites – which is where digital ads appear – are owned by publishers, who ultimately receive payment for the advertising that appears on their sites. At least, that’s how it is supposed to work. To talk about the complexity of the digital ecosystem and how brands and publishers can ensure their advertising avoids negative adjacency, I’m joined today by Jonathan Marciano, Director of Communications at CHEQ, an artificial intelligence-driven, ad verification service. In his role, Jonathan manages public relations, editorial content, marketing, and communications – and he’s the author of numerous landmark whitepapers that have been covered across the digital advertising industry and in media including The New York Times, Fast Company, AdAge, and CNBC, among others. Welcome to IN CLEAR FOCUS, Jonathan.

Jonathan Marciano:  Hi Adrian. Thanks so much for having me.

Adrian Tennant: What is your definition of brand safety?

Jonathan Marciano: Yeah, so brand safety is basically the controls that companies in the digital advertising supply chain use to protect brands against negative impact to their reputation. 

Adrian Tennant: Right. Where does ad verification sit within that?

Jonathan Marciano: So as you sort of outlined in your great introduction there’ve been a number of brand safety incidents, sort of most memorably was The Times of London, I think in 2017 where they had a front page revealing that some of the top brands were appearing to finance programmatically the videos and stories about terrorism and ISIS. And this was a big wake up call I think for the entire digital advertising space where basically brands couldn’t understand and couldn’t defend why their ads were being served in such toxic environments. And these incidents have kind of continued to grow and periodically brands have been called out for supporting everything from false information to terrorism to being advertised against negative stories even about their own companies. And so what came in its place was a number of ad verification players who were basically there to act as policemen to prevent the brands from appearing against this negative content.

Adrian Tennant: Now I understand CHEQ published a report called The Brand Safety Effect in October of 2018, which was based on a study you guys undertook with BMW and Hulu. What can you tell us about the research design and the methodology that you employed, first of all?

Jonathan Marciano: Yeah. So this was trying to get to the bottom of whether any of this, you know, really matters. Does a consumer who sees a brand next to a nicest video really care, does it really associate a brand with that? And we saw the answer was in fact, yes, they do know, and they do recognize the brands and they do have recall of the brand and the context in which sometimes horrific content is delivered. So we found in the research, which was with 2000 consumers, that there was strong sentiment about how brands where the company, the brands were keeping online. So the brands were shown adverts in basically unsafe, brand-unsafe content. So for instance, the classic example was an airline ad next to an article about an airline forcibly removing a passenger; a soda ad in front of content about diabetes. And basically the chief insight was that many consumers viewed this as an intentional endorsement for this negative content. I think some of the feedback we had was that it was manipulative, that it was disturbing, that they appeared to be generating revenue through disaster. And I think the headline figure was that there was a 2.8 times reduction in consumers’ intent to associate with this brand. So really hinting at an effect on the bottom line.

Adrian Tennant: You know, we will often track purchase intent and of course the likelihood to recommend to family and friends. So I think what I’m hearing is that those kinds of perceptions were indeed very negatively impacted as a result of this negative ad adjacency.

Jonathan Marciano:That’s right. 

Adrian Tennant: So could you tell me, how do brand safety platforms typically work?

Jonathan Marciano: So up until now, up until new players such as CHEQ basically there’s this very crude, and I’d say pretty unsophisticated, solution to the problem which is this idea of keyword blacklists, which have been created in the name of brand safety. So these are basically words, blacklists that are deemed too dangerous for advertisers to appear besides, so this is particularly talking about you know, no news content. So The New York Times or globally online the news industry. So anyone advertising against these sorts of sites, if an online news story contains words such as “sex,” or “terror,” or “ISIS,” or “killing,” then the concerned advertiser stays clear. They basically are prevented from serving ads against any of that content. And it basically de-monetizes the content for the publisher. And the side effect is that it’s a means that the reach of the brands themselves to reach engaged consumers reading this type of content is diminished.

Adrian Tennant: Why is it that keyword blacklists came to dominate the technology for brand safety? 

Jonathan Marciano: I think because it’s a fairly simple, I’d say a little bit of a lazy solution. It was a way to ostensibly get round this problem to kind of have a bit of a band aid solution to the problem. And I think in, in theory it’s not bad once the keyword blacklists kind of became manageable when you’re talking about a few words like “killing” and “attack.” But what’s happened is the number of keywords have increased to a crazy degree where there’s now 3,000 keywords on blacklists. And brands are basically having to avoid the news completely because there’s very, very little content that they can appear next to. And that’s affecting the whole system because it’s a hurting brand’s reach. It’s hurting premium publishers and it’s forcing advertisers to go to kind of the lowest common denominator and go to cheaper clicks, which are rife with fraud and and bad associations. And basically hurting, you know, the ultimate purpose of advertising, which is to create leads or convert customers.

Adrian Tennant: Now, just last month, you published, The Economic Cost of Keyword Blacklists for Online News Publishers. And this was a report that you undertook with the Merrick School of Business at the University of Baltimore. In the study, the economic price paid by publishers from incorrect blocking of safe content on premium news sites was in fact quantified. What can you tell us about the research design and the methodology that you used for this study?

Jonathan Marciano: So we found in the US alone, that $2.8 billion is lost by new sites every year. Well in 2019 because of an incorrect flagging of their most read online content. So this does assume that there are certain flags that the that it shows that there are certain blocking that is, is, is justified. But basically we found that 80% of ads served to premium publishers are subject to keyword blacklists. I think the IAB actually came up with a figure close to 95%, which makes us even a bit more conservative in our findings. But these blacklists were designed, as we said, on brand safety grounds by these ad verification providers. So to prevent brands from appearing next to toxic news content. However, by analyzing the actual stories that would have been blocked by these blacklists across 20 premium news sites, including The New York Times, CNN, and The Guardian, we saw that around 40% of global premium media inventory is actually brand safe. But of the safe content of this sort of content that is really, basically 57% that is safe is being actually blocked even though it’s safe because these ad verification blacklists basically don’t understand words such as “killed,” “dead,” “shoot,” and “injury,” which could be talking about an NBA player killing it in a game, or an injury in a football game. In particular, we also found that LGBTQ news publishers are seeing 73% of their inventory being denied through keywords such as “lesbian,” “bisexual,” and “same-sex.” And so based on the annual spend say in the US of 12 billion on online US news advertising we calculated that there’s at least $2.8 billion a year due to incorrect flagging for brand safety, which as you can imagine, for a hard pressed industry that’s already struggling, is a big pain point.

Adrian Tennant: One thing that stood out to me in the report was the way in which even really family friendly content around the launch of Disney+ service was flagged as unsafe. Can you talk to that?

Jonathan Marciano: Of course. Yeah. Google every year produces what is the most searched search trend of the year and in 2019 unsurprisingly, a lot of anticipation around Disney+ which is about, I think, is as brand safe as you could probably imagine a story could be a business which is solidly protective of its brand. But basically with stories about Disney+ proliferating, we found that many millions of impressions couldn’t be monetized because of entertainment. Because basically there were stories about Disney’s back catalog and what would be on the new platform. And it included things like a Star Wars Attack of the Clones and simply that one word, “attack” meant that brands were not able to advertise against this news. One of the first Avengers movies is called Infinity War. And we remember at the time when the Infinity War came out, a lot of publishers were turning to us and saying that they were basically seeing a huge drop off of revenue and all of these reviews of the movie, all these tie-ins to the movies, all this buzz was basically unmonetizable and put in the same bucket as terrorism and ISIS.

Adrian Tennant: You wrote an opinion piece highlighting the ways that keyword blacklists have unintended yet very adverse effects on LGBTQ consumers and the marketers and publishers who serve the community. Can you talk a little bit more about what you learned?

Jonathan Marciano: Yes. In general, there’s a 57% blocking of safe online news content. But when we started applying our methodology to LGBTQ publications like The Advocate and Pink News we found that there was a 77% blocking of their safe content. So there are stories, which are, you know, unarguably not safe. So there was stories of murder and those are fine not to be monetized, but it was stories about a lesbian couple that were being blocked. It was stories about Killing Eve because it was a TV series where they mentioned a a lesbian scenario. It was stories about same sex. So they were being blocked because of stories because of these key words such as “same-sex” or “lesbian.” I think that the point I wanted to make in the article was every year in Pride Month, we see every brand on LinkedIn and Twitter and Facebook and all the platforms changing their logos and appearing you know, LGBTQ-friendly. But when it comes to programmatic advertising, they’re basically denying advertising to stories that the community needs to survive. And as a result, some publishers have already been forced to close because they’ve been denied advertising and it’s a daily struggle. And I think that’s unjust and that’s unfair.

Adrian Tennant: We talked a lot about the problem. Talk to us about CHEQ and why your solution is different.

Jonathan Marciano: Thankfully there’s been advances since this sort of decades old, the technology of key words. And to be fair, some of the ad verification players who are not CHEQ have also started to realize that this situation is just no longer sustainable. And they’ve also started exploring AI options, but because CHEQ is a fairly young company founded in 2016, we look at every problem anew. So we didn’t have any of the previous keyword solutions and I think no one in the industry who was coming in fresh to this problem would ever say that that was a good solution. So CHEQ invested a lot of talent and energy and money in AI to solve the brand safety issue. In this situation, AI complete sequences to understand the meaning of the text and it understands the context of a story, similar to how we read and understand stories. Essentially it builds up a full picture of what the story is and what it’s not. So this enables a more contextual approach. So if I give you an example, to go back to some of the things that people, the brands don’t like appearing next to. The fast food restaurant chain wants to avoid appearing next to content about obesity, for instance. So we’ve trained the AI to define obesity as a category but also trained it to understand sub-terms such as “heart disease,” and “diabetes.” So this helps to show what a piece of content is and it doesn’t just look at one specific keyword, but it analyzes how many categories sub-terms are present in a piece and the relationship between them. So this allows the AI to understand if an obesity-related word is just random or if it’s actually about obesity. So in another way, previously a story that would mention alcohol would be blocked. But this AI enables, through its training, it understands whether it’s simply a mention of alcohol for a recipe, or if it’s something that is brand unsafe, such as driving under the influence. So this basically is a way for brands to decide what is brand safe. And the AI, based on their parameters, will be a far more human judge of brand safety than keywords.

Adrian Tennant: Right, understanding you, this is artificial intelligence.

Jonathan Marciano: That’s right. That’s machine learning. It’s artificial intelligence. So for instance, in terms of artificial intelligence, what’s important is the training and the data. And so for instance, to avoid the silly situation of Avengers being blocked or Disney being blocked, our AI has been trained on film scripts and reviews of TV shows and scripts. So it knows what goes into a story, about film and movies and singers, so that it knows that the Avengers is not a real war. Whereas it would understand based on a story about an invasion in Iraq, for instance, that is a real war. It pieces together the puzzle in milliseconds to decide whether something should be served or not against that content.

Adrian Tennant: Where does CHEQ sit in that digital supply chain?

Jonathan Marciano: We work mostly with brands, so we protect brands from advertising fraud, which itself is a $23 billion problem. And we also prevent the ads from appearing next to unsavory content. So mostly with brands, obviously they’re the ones that have the budget, as well with agencies. We can also integrate with publishers as well, but we have less publisher clients.

Adrian Tennant: Right. And we’re talking about a software-as-a-service model?

Jonathan Marciano: That’s right. So it’s a SaaS model. It has a very, very impressive dashboard. So you’ll receive instantaneous data on why your ads weren’t served. We show you every URL that was blocked. You know and this basically shows how much you’re saving. And it’s also very open and transparent. So we’re not saying doing this behind closed doors, we’re showing you all the data. And clients have appreciated that. There’s not much openness and transparency in digital advertising. And they appreciate that they can mark our homework and if there are any improvements that can be made, we can work on it. 

Adrian Tennant: Well, as you know, Bigeye is a full-service agency. What are some of the conversations that you think we need to be having with our clients about just these issues?

Jonathan Marciano: So it’s it comes down to talking to clients about first of all, on the one side, making sure that you’re protected, from ensuring that your brands aren’t served in bad places. We shouldn’t hide behind that we just simply don’t know where programmatic ads are being served or what their funding is, because that’s not the case. We can. There is a way to plan and execute your campaigns so that you are putting your brand and your revenue in the best position because ultimately not only are you serving ads on a content that is undesirable, it’s also probably not the audience you want to reach. And so it’s basically wasted money and wasted spending that could be going elsewhere.

Adrian Tennant: Jonathan, if listeners want to learn more about CHEQ, where can they find information?

Jonathan Marciano: Yeah, so probably the best place is our website. And there you can find out all the information schedule a demo and get a pilot.

Adrian Tennant: Right. And what books, articles, or other resources, would you recommend listeners that want to learn more about ad verification in general, or brand safety in particular?

Jonathan Marciano: So I always read Dr. Fou’s articles about fraud and brand safety. Augustine Fou is not very complimentary about verification players, but he’s always very sharp with his points and they present a lot of challenges to the industry. So I like him a lot. Ad verification, I mean, there isn’t that much. Digiday and AdAge report a lot on some of the challenges about blacklists. And they’re talking a lot more about the challenges that publishers face. So yeah, those, those would be some, something to look out for.

Adrian Tennant: Perfect. You were very modest, you didn’t include your own articles in there, but I have to say everything that’s been written by Jonathan is also very on-point. Jonathan Marciano, director of communications at CHEQ, it’s been our pleasure to have you on IN CLEAR FOCUS today. Thank you very much.

Jonathan Marciano: Thanks, Adrian. It’s been a pleasure.

[MUSIC]

Adrian Tennant: My thanks to our guest, Jonathan Marciano, Director of Communications at CHEQ. You can find links to the resources we discussed on the IN CLEAR FOCUS page at bigeyeagency.com under “Insights” – just click on the button marked “Podcast.” Consider subscribing to the show on Apple Podcasts, Spotify, or your favorite podcast player – and please, rate and review the show. And, if you have an Amazon Echo device, you can use the IN CLEAR FOCUS skill to add the podcast to your Flash Briefing. Thank you for listening to IN CLEAR FOCUS produced by Bigeye. I’ve been your host, Adrian Tennant. Until next week, goodbye.

 

Daniel Burstein of MECLABS Institute discusses adopting a customer-centric mindset and the growing adoption of smart devices will impact digital consumerism on IN CLEAR FOCUS.

IN CLEAR FOCUS this week: modeling the consumer mind with Daniel Burstein of MECLABS Institute. Focused on understanding online behaviors, Daniel walks us through the Institute’s patented conversion heuristic and offers practical tips to help optimize customer touchpoints for conversion. We discuss the benefits of adopting a customer-centric mindset, and reflect on how the growing adoption of smart devices, wearables, and the Internet of Things will impact digital consumerism. 

https://oembed.libsyn.com/embed?item_id=12967295

Episode Transcript

Adrian Tennant: You’re listening to IN CLEAR FOCUS, a unique perspective on the business of advertising produced weekly by Bigeye. Hello, I’m your host, Adrian Tennant, VP of Insights at Bigeye. An audience-focused, creative-driven, full-service advertising agency. We’re based in Orlando, Florida, but serve clients across the United States and beyond. Thank you for joining us. Today, we’re going to be talking about how to better understand consumers’ mindsets and use that knowledge to increase the likelihood of conversion. Almost 20 years ago now, Coca-Cola’s former head of US marketing Sergio Zyman wrote a book entitled, “The End of Advertising As We Know It.” In the book, Zyman identified the goal of advertising as simply to, “sell more stuff to more people, more often for more money.” He also observed that, “if you don’t keep giving customers reasons to buy from you, they won’t.” In defining strategic goals for advertising, we typically weigh the long-term benefits of brand campaigns with the shorter-term financial performance of activation campaigns. Brand building is about building up consumers’ long-term memories and positive mental associations. Establishing emotional connections is key as brand-building reaches customers who may not yet be in the market or even aware of the brand. Activation campaigns, on the other hand, are more about eliciting an immediate response, typically a sale or a lead. The challenge is to convert a prospective customer’s interest in a specific offer into the actual sale. The number of digital channels available to marketers to drive awareness and push prospects through the sales funnel has grown exponentially, but so too has competition for that rarest of consumer behaviors: our attention. To talk about how brands can cut through the clutter and maximize conversions, I’m joined today by Daniel Burstein, Senior Director of Content and Marketing at MECLABS Institute. In his role, Daniel helps shape the direction for the Institute by digging for actionable discoveries around conversion while serving as an advocate for the audience. Daniel also oversees all content and marketing coming from the MarketingExperiments and MarketingSherpa brands. Daniel has 20 years of experience in copywriting, editing, internal communications, sales enablement, and field marketing communications. Welcome to IN CLEAR FOCUS, Daniel.

Daniel Burstein:  Thank you. Wow – Adrian. That is a beautiful intro. I don’t even want to say anything. I just want to sit here and keep listening. And that was, that was fantastic. Tell me more.

Adrian Tennant: Haha, I love it! Thank you. Daniel, how do you define conversion?

Daniel Burstein:  Yeah, so conversion is anytime you want the customer to take action to do a thing, so sometimes, when we think of conversion, it’s, “Hey, let me, let me get my product sold… Let me get my services sold.” But let’s say if you want someone to open your email, you want someone to click on your email. Even if you want someone to just pay attention to an ad, then that’s a conversion. That’s an action you’re asking the customer to take.

Adrian Tennant:   Right. So what does the Institute do exactly?

Daniel Burstein: Yeah. So MECLABS Institute, it was founded by Flint McGlaughlin, more than two decades ago in the very early days of digital and the Internet and, and he saw that the Internet was a great way to answer a fundamental question – which is what we’re looking into – is how do people make choices, right? How do people make choices? Why did we say yes to one thing? No to another thing. Give our attention, like you said, to something and not do something else. And so for more than two decades, MECLABS Institute, the parent organization, has been researching that using real live digital interactions with customers through all sorts of different B2B and B2C product and service brands.

Adrian Tennant: Daniel, what does your role entail exactly at MECLABS?.

Daniel Burstein: So I’m, as I said, the Senior Director of Content and Marketing. So what I’m mostly just trying to do is learn – right? I’m trying to learn a lot about what works, how can we better market to our customers, how can we better serve our customers and then use that to teach. Then we share that out through content, through our written newsletters, through video medi, through podcasts like this and we publish through MarketingSherpa and MarketingExperiments – those are our two publishing sites – to help the marketers of the world to improve their marketing. So as I like to say, our job is to help you do your job better.

Adrian Tennant:  It sounds like a mission. And what do your clients or customers typically look like?

Daniel Burstein: So, I mean, we have many different levels of interacting. At the base level it’s our audience, which is marketers all over the world internationally. It’s the great thing about this digital revolution. They’re in big companies and in small companies, agency-side, client-side. As we move up, we have some of them take our training and some of them are students. And then at the highest level, the direct companies we work with, again, there is a real mix there. More on the big company side. There’s some small companies we work with as well. Usually the common denominator is that digital is important to them. Online platforms are important to them. But B2B, B2C services, product-based, and publisher, many, many different kinds.

Adrian Tennant: What are some of the most common challenges facing marketers that you come across most often?

Daniel Burstein: Yeah. I mean, marketers that we’re working with typically have that fundamental question of either, “I’m not getting the performance I want to be getting and why is that?” Or, “Hey, I’m doing well, but I could be doing better.” Right? Then the third one tends to be, “Okay, we’re about to launch something, but we don’t know what it should be.” It’s these very broad fundamental questions and those are the questions that marketers really need to ask. If we’re just so focused on, “I’m not getting the email conversion rate I need,” or, “I’m not getting the,the right cost when I’m trying to acquire someone through PPC.” I think we’re looking too granular, we really want to ask that more fundamental question of, “What do customers want? What is my company’s value proposition and how can I serve customers with it?” And that’s where true success lies.

Adrian Tennant: Hmmm. Now, do you think these challenges differ for agency-side versus client-side marketers?

Daniel Burstein: So a company essentially is just a value creation machine right there. There’s four walls around the building. What’s going on in there, whether it’s manufacturing, whether it’s a bank – value is being created. However, no customer knows what that value is unless we tell them about it, right? So the marketer is inside that company, hopefully they have those daily interactions and they’re seeing what’s going on in their company and they’re understanding that value so they can communicate it. Agencies that have, that had that remove until they have to work extra hard to get to intimately know the customer, get to intimately know everyone inside that company that’s creating value so that they can ultimately communicate it.

Adrian Tennant: Now, at the top of the episode I quoted, Sergio Zyman, who gave the goal of advertising as “to sell more stuff to more people, more often for more money.” Do you think people like to be sold anything these days?

Daniel Burstein:  Well, I think it’s a great example where we’re putting our goals first and we’re putting the customers’ goals second, right? It’s something Flint McGlaughlin calls, “The Marketer’s Blind Spot.” And it’s something that’s in our research, we call the need to focus on customer-first marketing. I mean really the goal – I tell you the definition I like much better, which you might’ve heard as well, is, “The Truth Well Told.” I mean, that at the end of the day is what advertising needs to be and not just for some moral high ground, but for the fundamental reason that customers have a lot of choices out there. So if it’s not the truth well told, one: they’re either going to find out pretty quickly, like you said, they’ve got, you’ve got his brand out there, they take an action and then they find out, “Oh wait, we’re not living up to this hype,” and two: when we don’t have the right intentions, it really comes through. So we did some research into customer-first marketing and what we did is we asked 1,200 customers, we said, “Think about a company you’re not satisfied with.” And then we said to another 1,200 customers, we said, “Think about a company you are satisfied with.” So we had half satisfied, half unsatisfied, and then we asked them about many different questions about the company. Two things we learned is: not surprisingly, satisfied customers are more likely to continue purchasing, right? But the difference is 713 percent, right? That’s a huge whopping amount, right? The difference between having a satisfied and unsatisfied customer. But the other difference, and this ties into the exact quote you were saying, is satisfied customers. We asked them to “describe the company, describe your interactions with and describe your experience.” And they had all these different things that the top thing they said is, “I consistently have good experiences with it.” Number nine was, “It puts my needs and wants above its own business goals.” So the exact thing we were talking about, customer-first marketing, are your goals. However, unsatisfied customers, the number one way they describe that company was “a company does not put my needs and wants above its business goals.” So what happens fundamentally, we as han beings, when we’re interacting with each other, when we’re interacting with a company, we kind of get a sense of, “Wait a minute, are they for me or are they out to get me?” When they’re, when they’re for me, when it’s someone for you, you have a good colleague who has a good heart, but he messes up here and there.  you give him the benefit of the doubt when they think you’re fundamentally out to get them you’re fundamentally trying to sell more product more often more and more and more and more about them. And customers can kind of sense that. And then they’re not as forgiving when something goes wrong and they’re not as likely to do business with you. So yes, we need to have those goals, but take a look at your own intentions. And if it’s not to serve a customer, which is the whole reason a company in business, it is not to serve a customer with your marketing and advertising. Customers are going to figure that out.

Adrian Tennant:  Hmmm, a great point. Daniel, your American Marketing Association piece on the conversion heuristic that you published, I think, late part of last year. Could you talk us through that and sort of the thinking behind it?

Daniel Burstein: Yeah, sure. So, MECLABS Institute has developed patented methodologies over the decades from the research we’ve done into customer behavior. And probably the one we’re best known for is the conversion heuristic. So, as I said, it’s funny, we were just at a bank in Toronto and one of the key executives there – we had almost 200 students at  an in-person training – and one of the executives there, who learned it about a decade ago, he said, “Hey, there’s one thing you cannot erase my whiteboard and it’s this conversion heuristic.” And what we tried to do – and Flint McGlaughlin has a patent for it, like I said, he’s our founder – is try to pattern, give some pattern recognition to what makes a successful piece of marketing or any sort of time you’re asking for a conversion goal. I’m going to say real quick, but as Adrian cautioned me, I know you can’t see what I’m saying. You can go to our website and see it. So I’m going to, I’m going to try to simplify it as much as possible. It’s gonna sound more complex. When I say it, it really is. So here it is, first. It’s c = 4m + 3v = 2 (i-f) – 2a. I’ll break that down real quick. All that means is those are the different elements that affect conversions. “C” is the probability of conversion. So our job, our goal with conversion optimization is to increase the probability of conversion. You’re never 100 percent sure you’re going to get conversion, right? But what can we do to increase that probability? And then here are the factors; “4m” that means four, that’s the highest coefficient. It means that is the most important element. “M” stands for motivation of the user. The best thing we can do, again, focusing on that customer, is tap into their motivations. Yeah. So you can always try to sell people on something they don’t care about or they don’t want. But if you can tap into those motivations, those right motivations, that’s where success lies. Of that “3v,” then that is the force of the value proposition. Right? How clearly are you communicating your value proposition? How credibly is it something that people believe? Do you have a value proposition? Do you know what it is? All marketing is, is getting that value out to customers. If they perceive the value correctly and they think there’s value for them, they will most likely purchase it. So the “2 (i-f),” they add this friction. So that’s got a minus in front of it. That’s negative, right? So there’s friction in the process that’s going to slow you down. So I like to say, “We’re all inherently lazy,” right? Lazy kind of has a bad connotation, right? When you say that word, lazy, you think it’s negative. But really I think laziness is what preserved us when we were cavemen out on the plains and  we would only go and burn calories if we really needed to, cause we didn’t know the next time we’d kill a woolly mammoth. I mean that’s han nature. We’re lazy. So any friction in the process, it’s gonna make people less likely to buy. The “i” is for incentive. So for incentive, I like to call it the bacon of marketing tactics. So what some marketers do is they don’t really have a lot of value. They don’t understand the motivation. They’re not trying to remove friction, but let’s just throw incentive, right? It’s free shipping. get a $20 Amazon gift card if you buy – incentive incentive incentive, let’s hit our numbers. Car companies, car companies were the worst with this. They were like, “We will pay you money to buy our car. Do you want, you want to send you, here’s $5,000.” And so the way we talk about incentive is you don’t want to sell just on incentive. It’s going to kill your margins. It’s going to kill customers believing in the value of your product, but it is that little extra something that can tip people, that can help them overcome that friction to want to purchase.and lastly, there’s anxiety that’s also negative. That’s, that’s a negative thing that’s going to stop people from purchasing. So understanding what anxieties do they have and how can you alleviate their anxieties about the process and the product.

Adrian Tennant: Hmmm I think what’s really fascinating, apart from the fact that you’ve been able to quantify the whole process of conversion into this formula is the philosophy you seem to be following is actually not technology-driven. It’s way more than human behavior-driven. Correct?

Daniel Burstein:  Oh, I’m glad you said that. I think one of the biggest challenges that we have in marketing today is that we’ve lost the humanity. Like it’s all MarTech, it’s all AI and machine learning and buzzwords, buzzwords, buzzwords. And that stuff’s powerful. But at the end of the day, what is your goal as a marketer? I mean, what is your value in the organization? Why are you going to work every day? It’s to be that han face, that han communication for the company and tap into the humanity of your customers. So I think a real vision, that Flint McGlaughlin had over two decades ago when, when he started getting into this, it wasn’t about the Internet and it wasn’t about any of that for it. The whole point was on the Internet, you can measure and look at customer behavior like never before, and taking that and then creating this pattern methodology like he did to show, “Hey, here’s what, here’s what the elements that affect our likelihood to act or not act,” like you said, “as people, not just automatons or machines, but as human beings.”

Adrian Tennant: Now, looking back over the past couple of decades then, do you think though that we have evolved in some ways – consumers – with each iteration of personal digital technology,or are we pretty much the same as we were pre-Internet?

Daniel Burstein: So, I think in certain ways we’ve evolved just understanding. I remember a time when people wouldn’t want to do banking online or people wouldn’t understand that they could purchase online or some of these things they wouldn’t know how to interact with an online store, e-commerce, it would cost to put their credit card in. Now my mom who is well into her seventies, she’s comfortable purchasing online from Amazon. So yes, in the ways of learning how to interact, we have, but in our fundamental human nature, I don’t think human nature is changed in a thousand years, in 2,000 years. Some of these elements we talk about – anxiety, friction, value – they’ve existed as long as a human society has existed. And so what we’re just seeing is that’s just playing out in a new venue, in the online venue. So for example our anxiety a thousand years ago might be that, “The Visigoths, they’re going to come over the hill and destroy our village,” right? And so now first-world problems our anxiety now might be, “Okay, “I’m going to purchase these designer headphones,  but they’re not going to last more than six months” or… You know what I mean? But we still have those anxieties and it’s understanding how to tap into them, and really overcome them with our marketing and make people feel better about them.

Adrian Tennant: How do you think that conversion heuristic will maybe need to adapt in order to take on maybe the influence of, say, smart speakers or even the Internet of things and multiple connected devices?

Daniel Burstein: Well, I think it’ll be interesting. That’s to be seen. But, so something I’ve learned about the heuristic is, it’s not just really for a landing page or it’s not just even really for an email. Like when I go to speak, I do recruiting for clubs at the local university. Well, I’m speaking to those students. I use a conversion heuristic to walk them through the fundamental elements they should consider when they’re looking for their first career. So this isn’t just about a specific technology or a specific landing page. If we’re dealing with a smart speaker, if we’re dealing with the Internet of things, we’re still gonna have those same types of elements. Right? “Oh, what’s my motivation?” Like, “How can I tap into that with the smart speaker?  What kind of friction is involved with that smart speaker?” So when you think about things like IOT and smart speakers and some of the things Amazon’s done, even what are they trying to do? They’re essentially trying to reduce friction to make it easier for people to make purchases or to find information. And they’re essentially trying to better tap into motivation by understanding, what, what motivates them and what they’re trying to get, what they’re looking for. So I wouldn’t say it would never change. I mean, one, one thing that we’ve changed over the years is to “v” used to stand for the clarity of the value proposition. And we noticed more and more it’s important to talk about the force of the value proposition because one thing that companies are really overlooking is the credibility aspect. So it could be clear, but if it’s not credible, it’s not forceful. So yes, it may change, things may change over time, but at the same time it’s pretty fundamental what we’re talking about here.

Adrian Tennant: Now I started the show by talking about long-term brand building versus short-term activation campaigns. Advertising industry veterans, Les Binet and Peter Fields – both over in the UK – believe that if brands can afford to do both, that is brand-building and activation, and that the ideal balance between them is 60 percent brand-building and 40 percent activation. But what if you can’t afford to do that? Is there a happy middle ground? Do you think brands can effectively combine both brand and activation within campaigns?

Daniel Burstein:  So in my opinion, every customer touch point, every time you’re touching a customer, how it affects the brand. And I would go even farther to say, not even just direct response and branding, like those traditional advertising and marketing elements. I mean, if you’re a marketer in a company, a, if you’re working at an ad agency, you’ve got to understand how else the customer is being touched. Because no matter how much you get your messages out there, either branding or direct response, if, if your company is not living up to it, to the customer, you’re losing an opportunity. So I’ll give you an example of how this applies to me, I wrote about this. I bought, from the Home Depot, I bought a dryer or washing machine or something like that. And so then, I got them to come and install it and I bought it online. And then when they come to install it, I’m waiting by my phone window and I see a truck drive by and it’s like, just kinda like an unmarked van with a trailer and it’s got some washers and dryers in the back. And I’m like, “Well, that can’t be it.” And a few minutes later, sure enough, my doorbell rings and what Home Depot did – and I’m not picking on Home Depot, a lot of companies do this, but – they outsourced, right? They probably figured, “Hey, it’s, it’s cheaper to outsource to whatever local companies or whoever’s doing it than it is to have our own branded Home Depot truck and our own brand at Home Depot.” People come up there. So you talk about, “Hey, if you can’t afford to do both branding and direct response.” So I would say the budget’s everywhere. If [the fulfillment of your product, the delivery of your product. If you’re Home Depot and you’re looking at Hey, we’re going to save 10% on fulfillment by outsourcing like this. Well you’re not looking at is you’re shooting yourself in the foot from, from a brand recognition perspective and a brand affinity perspective. If that is that Home Depot, beautiful Home Depot truck pulls up and the folks come out and they’re dressed to the nines, they do a fantastic job and they’re even consulting with me there. Well I’m, I just had a great Home Depot experience and even if that’s technically a fulfillment budget and not a branding or a marketing budget that was marketing. The same is true for customer service. I call customer service one-to-one marketing. So maybe I got off on a bit of a tangent there, but I want to bring up the point that don’t just look at your direct response budget or any budget. Look at the whole company’s budget, look at every customer touchpoint and how can you make that customer touch point better? How can you serve the customer better? That’s gonna improve your brand. And then again, the same goes with the direct response. So that’s where we talk about incentive earlier where I said incentive is a bacon of marketing tactics, right? How would I mean is, well, a little bit of a cooking tip here. If you’re a bad cook, if you can’t cook and you just want to make something better, just throw bacon on it, right? So if you have a plain kale salad, it’s going to taste better if you throw bacon on it. And that’s what some marketers do, right? They don’t really have a good value prop. They maybe don’t have a good brand. It just throws bacon on – 20% off, 30% off. Like I said, the American car companies will pay you five grand to buy our car. So what is that doing to your brand, right? Yes, if you’re getting that near-term conversion of using programmatic, if you’re doing all these things, you’re getting that near-term conversion, but it’s not really a great experience for your brand. If 2% are clicking through and buying and you’re getting a good return on ad spend, well the other 98% are having a bad feeling for your brand. What is that doing? So I’d say let’s step back. Let’s hold hands. Let’s all get together. The branding folks, the I direct response folks that digital folks, customer service firm and everyone and look at it holistically and say, “how do we touch our customer and how can we best serve them?”

Adrian Tennant: Daniel, what books or articles or other resources do you recommend for listeners that want to learn more about human behavior in general or conversion in particular?

Daniel Burstein: Yeah, I mean, in terms of books, I highly recommend the research and the work of Dr. Dan Ariely. He’s got a book, “Predictably Irrational.” It’s a great book and he does a lot of other things. He has a column in The Wall Street Journal, and he published on blogs. We’ve had him as a speaker before. He’s also a super cool guy in person and he does a great job of taking the complex research he does and distilling in a way that you easily understand it. So he’s a behavioral economist and really getting into any of the behavioral economic work is super helpful if you’re interested in conversion-focused marketing. Another book that’s great is, “The Power of Habit,” by New York Times reporter Charles Duhigg. We’ve also had him as a speaker. He is the nicest guy in person, super friendly guy. His book is a great reminder that not everything we’re doing is logically thinking through and making a purchase decision. There’s so many things we’re doing habitually. So how do you get through those customers are doing things habitually and how do you help them set up new habits? And personally what I do – and I really learned this even when I was back in college, one of my professors told me that copywriters are just the most well-read people you’ll ever meet – and I just read tons of newspapers and magazines. I like to read print cause I’m on digital all day and print it. And reading newspapers and magazines, it’s a great way to really understand different niche audiences and just what’s going on in the world. And he fills your head up with a lot that you later tap into when you’re writing that conversion focused copy. So I don’t entirely know how the creative process works. I’m sure you could have some great professors here. He said, but all I know is you, you gotta there’s an input in and output and if you’re just grinding all day, if you’re just trying to write that come up that next grade concept, come up with that great next campaign eventually you’re going to get tapped out. And so,  I try to put in as much as possible and somehow magically be some niche magazine or read or the wall street journal or, or whatever. I know that idea pops in your head. I don’t know where I came from, but I know if I put it in there lunch would be there when I need to take it out.

Adrian Tennant: Daniel, can you tell us a little bit about the different kinds of learning opportunities that exist with MECLABS, both onsite and online?

Daniel Burstein:  Sure. So we have four certification courses based on the methodologies we’ve learned through our experimentation. There is value proposition, landing page optimization, which is very focused on that conversion optimization – that heuristic I talked about, email messaging, and online testing. And you can either take it on your own at your own pace online or we also do in-person team trainings as well.

Adrian Tennant:  Got it. And if listeners would like to know more about the work of MECLABS, where can they find you online?

Daniel Burstein:  Oh, it’s really easy. MECLABS.com. You can find a lot of free resources there. A lot of helpful information.

Adrian Tennant:  Daniel. It’s been a real pleasure. Thank you very much for joining us today. 

Daniel Burstein: Thanks, Adrian – it’s my pleasure. Thanks for having me.

[MUSIC]
Adrian Tennant: My thanks to our guest, Daniel Burstein, Senior Director of Content Marketing at MECLABS Institute. You can find links to the resources we discussed on the IN CLEAR FOCUS page at bigeyeagency.com under “Insights.” Consider subscribing to the show on Apple Podcasts, Spotify, or your favorite podcast player. And please rate and review the show. And if you have an Amazon Echo device, you can use the IN CLEAR FOCUS skill to add the podcast to your Flash Briefing. Thank you for listening to IN CLEAR FOCUS produced by Bigeye. I’ve been your host, Adrian Tennant. Until next week, goodbye.

Bigeye’s Senior Strategist, Dana Cassell, examines the business of identifying, analyzing, and predicting trends in consumer culture on IN CLEAR FOCUS.

IN CLEAR FOCUS this week: consumer trends. Bigeye’s Senior Strategist, Dana Cassell, examines the business of identifying, analyzing, and predicting trends in consumer culture. We discuss Data Abundance and Ungendering – two trends identified in Rohit Bhargava’s new book, “Non-Obvious Megatrends,” and assess how marketers can benefit from successfully identifying and tapping into what’s trending.

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Episode Transcript

Adrian Tennant: You’re listening to IN CLEAR FOCUS, a unique perspective on the business of advertising produced weekly by Bigeye. Hello, I’m your host Adrian Tennant, VP of insights at Bigeye. An audience-focused, creative-driven, full-service advertising agency, we’re based in Orlando, Florida, but serve clients across the United States and beyond. Thank you for joining us. It’s the first month of the new year and the new decade, the perfect time to put consumer trends IN CLEAR FOCUS. Identifying trends in consumer behavior – and more broadly, their cultural context – is a part of the work that advertising agencies, marketing-oriented management consultancies, research groups and design firms undertake regularly for clients. But there are also many standalone trend agencies with a focus on helping organizations imagine, plan for, and navigate the future. One of the first examples of this kind of forecasting was a study commissioned by president Herbert Hoover. Published in 1933, the study was entitled, “Recent Social Trends,” and Hoover wrote the foreword, which noted, “the task was to inquire into changing trends, resulting in emphasis on elements of instability rather than stability in the social structure.” Today, trends are an accepted part of consumer culture, so much so that we use the word, “trending,” to acknowledge a rapid rise in popularity and often an equally fast fade. Consumer trend forecasting as we know it got its start in the 1970s, a particularly turbulent decade in the West, which saw major political, social and economic changes including feminism, environmentalism, civil rights, war and economic instability caused in part by the energy crisis. It was in this context that futurology – the study of the future and science of forecasting – first developed and motivated various government initiatives, think tanks, and policy groups. The bestselling book, “Future Shock,” by Alvin Toffler was published in 1970 and accurately predicted the Internet, the sharing economy and telecommuting. Fast-forward to today and there are now many trend forecasting firms. For example, Sparks & Honey describes itself as a “cultural consultancy.” Four days a week, its consultants livestream video of a 60-minute discussion on the latest trends from its New York studios. Other companies in this space include PSFK, Trend Watching and Cool Hunting. The Canadian Trendhunter.com uses a crowdsourced model leveraging a global network of almost 250,000 trend spotters, artificial intelligence, and its own team of researchers and futurists. It scores trends across multiple dimensions including popularity and “freshness.” And the largest research groups including Nielsen and Euromonitor also regularly offer commentaries on consumer trends. To talk about trend analysis and its practical application to marketing communication and brand strategy, I’m joined here in the studio today by Dana Cassell, Bigeye’s Senior Strategist. Welcome back to IN CLEAR FOCUS, Dana.

Dana Cassell: Thanks Adrian. Let’s talk about strategy.

Adrian Tennant: So what’s your definition of a consumer trend?

Dana Cassell: I think a consumer trend is the direction of change or development and when we talk about it in marketing we mean change or development in consumer behavior, preferences or attitudes. Do you have a different take on that?

Adrian Tennant: There’s a couple that I found that I do like. So one – which is a bit wordy – is: “a trend collapses the distance between the past, present and future, by showcasing how the world of tomorrow exists today.”

Dana Cassell: Do you have that stitched on a pillow at home?

Adrian Tennant: Sounds like it could be something we could put on a wall.

Dana Cassell: Christmas gift!

Adrian Tennant: Hmmm. Or as William Gibson may or may not have written, “the future is already here, it is just unevenly distributed.”

Dana Cassell: Hmm.

Adrian Tennant: So what’s the difference between a consumer trend and a fad?

Dana Cassell: I’ve spent some time on this one and I think it comes down to lifespan. I think a fad is in and out and has a less long-term influence. And I think trends are generally longer-standing behaviors or changes and have a higher potential to influence culture in the long-term.

Adrian Tennant: Now, to what extent have you identified and labeled cultural dynamics in your work with clients?

Dana Cassell: Well, cultural dynamics are always at play, whether it’s why a client has approached us or not. So they’re always around and I think, two different questions: to what extent have I identified them and labeled them. Identifying them? Always. This always is happening, as the foundational elements of understanding a brand or a client. So omnipresent, always should be understood. To what extent are they labeled, I think, is a more nuanced question. I don’t think cultural dynamics are always a top three priority in campaigns. Sometimes they are though and sometimes they’re the root of the reason a client has come to an agency. There might be some divergence of opinion on how important a cultural trend is for that organization internally. And we’re here to find some data to settle that score. So I would say always identified, sometimes labeled.

Adrian Tennant: Okay. Well, identifying trends can reveal of course, deeper insights about how future scenarios might impact consumer culture and of course consumption. In your view, are brands maximizing the potential of consumer trends?

Dana Cassell: Yeah, some of them. Some of them do, some of them don’t. But also some trends are easier to maximize. Like for instance, we’re in the middle of a shift to a consumer-centric model of customization and delivery, like all of our monthly subscriptions and our boxes and try on the clothes, send back the pieces you don’t want, and get your very unique box of crafted local produce delivered to your doorstep. This kind of very consumer-centric customization and delivery trend is easier to maximize for lots of brands than some other trends that are happening. Like the shift away from terrestrial shopping is much harder for some industries to maximize. Small boutiques have had a much harder time moving online into an e-commerce model. So some trends are nearly impossible to maximize for certain types of industry. Others seem more ubiquitous in their possibility.

Adrian Tennant:  In what kinds of ways might a client translate a newly emerging trend into a market opportunity?

Dana Cassell: I was thinking about the banking industry and video. So if the trend is brands using beautifully-told, compelling video to tell their brand story and then slicing that video into various parts of a content library. So some for TV, some for over-the-top, some digital, some in app, maybe some email, account-based strategy. So the trend being using beautiful video to create a generous video content library. How can a client maximize this trend? I think of our banking clients and our work in the financial industry, that’s not an industry that has typically spent a ton of money in high-produced, quality video. And we’re seeing some of our brands who are more interested in moving forward into a more modern phase of banking, adopt that and find ways of telling their brand story well through video and not just using maybe some old tropes that have been used in TV advertising for a long time in that industry, but really thinking about high production value in storytelling through video.

Adrian Tennant:  Mmm. I think that’s a great example. Also, I know I often mention the UK, but there are some parallels in the industry. Over there, a direct-to-consumer bank brand has launched a campaign that’s really built around the insight that one of the main stressors for young people is their financial health.

Dana Cassell: Sure.

Adrian Tennant: So the advertising campaign plays on that idea of health and wellness and particularly mental health, with some quite thought-provoking creative. So there’s a trend towards health and wellness with a particular demographic applied to finance.

Dana Cassell: Brilliant. So they’re bringing financial health into the health and wellness trend we’re seeing?

Adrian Tennant: Absolutely.

Dana Cassell: That’s great.

Adrian Tennant: Yeah. So that’s an example of how it can work.

Dana Cassell: I love that one.

Adrian Tennant: Have you found a framework or an approach that has helped you become more attuned to trends?

Dana Cassell: I think this is a really interesting question and I was trying to figure out what it is. I know I have a framework and approach for identifying them because I have a pattern of being able to look back and see trends and how we use them in strategy. So I know that we have found ways to identify them well, but I didn’t know exactly how so I appreciate that you asked this question. The only solid answer I can come up with, it seems to be real over time is when something becomes disruptive enough that I have to sort of put something aside and go figure out what this thing is. Like one example I’ve thought of is when filters started becoming really popular for people to use on photos and I was seeing enough weird cat ears, bunny noses, whiskers on people like, “okay, what is happening?” I need to, I’m seeing this enough that I need to go figure it out. I feel behind in something. And then I can go and absorb what’s going on and where it started and how it’s impacting people. And then extrapolating that from the just the consumer piece up into our brands, which I think is how I see trends happening a lot. I start to understand them as a consumer, and then as a strategist I start to think, “okay, if this is how people are relating one-on-one to this trend, what does that mean for the brands that serve those people?”

Adrian Tennant: Dana, in your world, what’s trending right now?

Dana Cassell: So my world… I think it’s important to define my world a little bit for people who might not know me. So I am 38, I am a mother of two young girls. I’m married, I travel quite a bit, and in my world what’s trending right now, health tracking is all over the place. So this could be a middle life thing. Age stage and trend is a fascinating question. What is related to stage versus what is it a broader trend? I think they also might be the same thing, but anyway, health tracking is a big deal. The watches. I’m getting reports from some people in my life about how many minutes of REM sleep they’re getting at night. I care. I don’t know how much I care. I care. He’ll listen. I care. The concept of a gender reveal as people are having babies, this is a thing that’s happened in the world. It’s a new, a trend. It’s not so much new anymore. It’s not a fad anymore. I think it’s a trend. The concept of screen time as a parent, as a human, that health as you’re talking about a holistic approach at house screen time and related to that cutting cable,moving from a cable-oriented environment to a very consumer-customized streaming approach. There’s also a trend in tiny home downsizing, a shift from thinking about “what can we amass?” to, “what exactly are we amassing in our home?” I’m seeing that happen a lot. Clean eating. I’m also seeing a trend in the podcast catch-up, whether you are an early adopter or not. Podcasting – it’s disruptive enough that I think if you haven’t been a podcast listener at this point, you’re probably like, “okay, what does this whole podcast thing about?” So I’m enjoying being able to help people onboard into podcasts and find their little custom feed that’s a great fit for their lifestyle. So I think the trend of podcast catch-up and then the last thing I think – this is bigger than my life stage for sure – is the trend of product food, kind of household everything, having a focus on craft or maker local, locally-sourced. So that trend of local craft artisan lifestyle, I see as a pretty substantial trend at this point. 

Adrian Tennant: Okay, so full disclosure, Dana and I received a pre-publication copy of a new book authored by Rohit Bhargava, entitled, “Non-Obvious Mega Trends: How to See What Others Miss and Predict the Future.” This is the tenth edition in an annual series and has already reached bestseller status on Amazon.com. There are 10 mega trends identified in the book, which in a tradition of trend consulting have suitably catchy labels applied including Amplified Identity, Ungendering, Attention Wealth, Purposeful Profit, and Data Abundance. So for our inaugural IN CLEAR FOCUS book club, let’s dive into a couple of the trends that the book identifies. Data is very much in the news these days, usually for the wrong reasons. Uh, we know from our own research that there’s growing anxiety among consumers about potential misuses of personal data. What then is data abundance?

Dana Cassell: Data abundance is – I think it’s the age we’re in, like the information age – I think we’re in the age of data abundance. The book notes that 90% of the data in the world has been collected in the last two years. 90% of the data in the world in the last two years. We’re just living in a time where we’re collecting data on everything all the time. And that’s a new idea. It’s only been about the last 15 years that collecting and using data has become important. So there are a few questions that come out of the age of data abundance, which is what’s the meaning of this data? How do we use it? Who owns it? And who’s entitled to profit from it?

Adrian Tennant:  So Dana, in what ways does this perspective offer fresh insights into data environments?

Dana Cassell: Yeah, in the age of data abundance, we have to understand that more is not always better. When we began collecting data in marketing, it was just lovely to have data and to be able to use it. But now we have all of it. That doesn’t necessarily mean that it’s better. However, everybody can and should be understanding the data that they are collecting and how we can maximize it. For our brands. We do have a responsibility with data in many different ways and transparency to our clients and our consumers. And also balancing the integrity of using data with profit. So just that general understanding that profit is never worth sacrificing and brand’s integrity and the data abundant environment calls that line to question often.

Adrian Tennant: And how does Bhargava differentiate good data from bad data?

Dana Cassell:  Yeah, he talks about data pollution, and that being the point of differentiation between good and bad. And there are a few ways that data gets polluted. We can have an overflow of data, data manipulation, data sabotage, data contamination and data exploration. I feel with our clients, we see kind of two pieces of data pollution happening regularly and that in marketing we see more of these issues. Data overflow, which is really when too much data gets captured and our clients just don’t know what to focus on or data expiration: so when data is not updated as frequently as necessary and then loses its value because it’s not current.

Adrian Tennant: Okay. How practical were the book’s suggestions around making meaning out of data?

Dana Cassell: Again, it kind of depends on what kind of data you have about how practical his suggestions were. He told a case study about a car insurance company in China that uses images of damage to cars and images of car parts to analyze an accident and then analyze the price to have that fixed in order to make an estimate for repair. And obviously that’s a really meaningful way to use data. And they have a ton of data that’s informed that and so it’s saved the industry an insane amount of money. It has created an efficiency for clients as well. So I think that example is a great example of how to make meaning out of data. I’m always interested in how our clients can make meaning out of data. And I think that’s part of our role as strategists is to help our clients understand what is the most meaningful data that they’re collecting and how can we use that in a way that there’s high integrity and responsibility to consumers, but also interest for the brand.

Adrian Tennant: Dana, did this trend feel mega or non-obvious to you?

Dana Cassell: Mega! Data’s never non-obvious, come on!

Adrian Tennant: [Laughing].

Dana Cassell: So Adrian, for our chat today, you focused on the Ungendering trend and chapter in the book. What’s that all about?

Adrian Tennant: Bhargava makes the case that traditional gender divisions and labels are kind of getting replaced now with more fluid understandings around gender identity. That in itself is forcing a reevaluation of how we see employees, employers, customers, brands, and of course one another.

Dana Cassell: So does the trend change the way we need to think about gender-based roles?

Adrian Tennant: So in the 1970s, he talks about the fact that the ideal of femininity was a woman who kind of has it all, in other words, a job and a family and a household to take care of. Then women were celebrated for being the jugglers in chief and expected to uphold kind of impossible standards – right? – in the workplace and at home. And then this facade he talks about is also breaking apart at breakneck speed. And you have a much fiercer model of femininity now where women can be strong and serious at the same time, you can still be a mother or you can have this thing that he calls “otherhood” which describes women who by choice or circumstantial infertility don’t have children.

Dana Cassell: Uh-huh. So what is the book’s take on Gender X – and what is Gender X?

Adrian Tennant:  More than 10 US States have passed legislation allowing individuals to select a gender-neutral choice of X rather than the letter M or F when they apply for a driver’s license or an ID card. Um, and this has actually already been a thing for about a decade. Australia, Germany, Canada and India have also allowed for this third option on passports. So nonbinary gender identity is definitely gaining mainstream attention. So it’s a trend, not a fad.

Dana Cassell:  And what does being ungendered mean for consumer behavior?

Adrian Tennant:   Growing up, I knew what toys were designed for me because they would be blue.

Dana Cassell:  Uh-huh

Adrian Tennant:  And you probably grew up at a time when your toys were pink.

Dana Cassell: And purple. Yeah.

Adrian Tennant:  A lot of parents are questioning that, that whole idea. So toy makers in particular are deliberately designing much more inclusive packaging and avoiding attachment of a gender to the product itself.

Dana Cassell: Mmm.

Adrian Tennant: A great example that I found, not mentioned in this book, but you may recall, towards the tail end of last year, Mattel…

Dana Cassell: Uh-huh.

Adrian Tennant: …brought out a range of gender-neutral dolls for boys, girls and as they said in the press release, “children in between.” So super interesting. I really liked Mattel‘s summation of this – they said, “in our world dolls are as limitless as the kids who play with them. Introducing Creatable World, a doll line designed to keep labels out and invite everyone in.”

Dana Cassell: Brilliant line. Great line.

Adrian Tennant: I love that. I love that.

Dana Cassell: Does this trend of ungendering feel mega or non-obvious to you, Adrian?

Adrian Tennant: Mega? Yes. When Reema Elghossain, who’s the VP of Talent, Equity, and Inclusion at the 4A’s Foundation joined us on IN CLEAR FOCUS recently, we actually talked about this very topic in the context of the changing workplace. Bhargava makes the point that biases take time, sometimes generations, to change. And I think we’ve seen that to some extent with LGBTQ issues, but gender identity feels like a whole new frontier. As for non-obvious, maybe not so much but that’s because I have the privilege of working in the city of Orlando. Last year the city received a perfect 100 out of 100 score on the Human Rights Campaign’s Municipal Equality Index, which assesses discrimination on the basis of sexual orientation – and gender identity.

Dana Cassell: Hmmm!

Adrian Tennant: Dana, thank you very much for joining us again today.

Dana Cassell: Thanks for having me. Anytime you want to talk about strategy and research, Adrian.
Adrian Tennant: So of course, my thanks to Dana Cassell, Senior Strategist at Bigeye. You can find links to the resources we discussed on the IN CLEAR FOCUS page at bigeyeagency.com under “Insights.” And please consider subscribing to the show on Apple podcasts, Spotify, or your favorite podcast player. And if you have an Amazon Echo device, you can use the IN CLEAR FOCUS skill to add the podcast to your Flash Briefing. Thank you again for listening to IN CLEAR FOCUS, produced by Bigeye. I’ve been your host, Adrian Tennant. Until next week, goodbye.

Ad agencies are making diversity, and gender equality a priority. Reema Elghossain of the 4A’s Foundation and Maegan Trinidad of Bigeye join us on IN CLEAR FOCUS.

IN CLEAR FOCUS this week: How advertising agencies are attracting new employees and approaching retention, diversity, and gender equality. Reema Elghossain, VP of Talent, Equity & Inclusion at the 4A’s Foundation, shares her observations about how generational differences and attitudes towards gender and identity are changing how agencies engage with their staff. We also hear from Bigeye’s Digital Marketing Specialist, Maegan Trinidad, who is an alumna of the 4A’s Multicultural Advertising Internship Program (MAIP) and learn how it helped her enter the industry. 

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Episode Transcript

Adrian Tennant: You’re listening to IN CLEAR FOCUS, a unique perspective on the business of advertising, produced weekly by Bigeye. Hello, I’m your host, Adrian Tennant, VP of Insights at the Bigeye. An audience-focused, creative- driven, full-service advertising agency, we’re based in Orlando, Florida, but serve clients across the United States and beyond. Thank you for joining us today. The most recent data from the US Bureau of Labor Statistics shows that unemployment is at 3.5%, the lowest rate since 1969. Filling vacant positions or newly created positions is a significant challenge for many employers – especially those seeking to grow – and competition for workers is fierce. Candidates with creative and media skills have many options when it comes to potential employers. Design, marketing and writing skills are sought by companies beyond advertising and media agencies. Consider tech companies and the growth of direct-to-consumer products and services, many of which have opted to develop creative and media buying capabilities in-house. The rise of digital media has also brought with it a new wave of tech savvy creatives and analytical thinkers, many of them working client side. Advertising agencies certainly compete for creative talent, but in addition, are challenged to recruit and retain workforces that reflect America’s ethnic and racial diversity. Almost half a century ago, the American Association of Advertising Agencies better known as the 4A’s recognized the lack of diversity in the industry. In 1973, the 4A’s launched its minority intern program to encourage students from diverse ethnic and racial backgrounds to consider careers in advertising. And later the organization awarded scholarships to African American, Hispanic, and Asian American young professionals entering the industry. Nearly 50 years on the 4A’s continues to represent the marketing communications agency business. The organization’s stated mission is to empower agencies to thrive by advancing issues such as evolving agency models, but also talent, retention, diversity and gender equality. Joining me via phone from New York City today, Reema Elghossain is Vice President of the 4A’s Foundation and responsible for talent, equity and inclusion. Reema has 15 years of experience in education, talent development, and diversity and leads some of the industry’s most prominent diversity pipeline initiatives. These include the Multicultural Advertising Internship Program known as MAIP, which evolved from the original Minority Intern Program. Reema also oversees the 4A’s Foundation’s educational programs, scholarships and awards, as well as professional and organizational development opportunities. Welcome to IN CLEAR FOCUS, Reema.

Reema Elghossain: Hello. Thank you.

Adrian Tennant: Reema, could you explain a little more about the Foundation and the part it plays within the 4A’s?

Reema Elghossain: Sure, absolutely. So the 4A’s Foundation was established in 1997, with a commitment to provide scholarships and awards for young people of color interested in getting involved in the advertising industry. In the last two years, the 4A’s made an intentional decision to move MAIP and our educational programs, which include our high school initiatives over into the 4A’s Foundation. So it really serves the industry, advertising and marketing at large, with all of their talent needs, especially when it comes to diversity, equity, and inclusion. So we really try to support the industry from the 4A’s Foundation with finding diverse talent, with educating diverse talent, n what advertising is and the experience, and then really developing that talent once they’re into the industry.

Adrian Tennant: I mentioned during the introduction that the 4A’s had the foresight to establish an internship program focused on diversity back in the 1970s. In what kinds of ways does your work with the 4A’s Foundation today help young professionals in their careers?

Reema Elghossain: We do it a number of ways within our educational programs. We partner right now with two high schools in New York city that are predominantly students of color that actually have an advertising track within the high school programs. And so what we do for our high school students is we try to immerse them into the advertising industry. We connect to them with speakers and experts in the industry to share insight. We host events and competitions for them so that they can understand what it’s like to get briefed by a client and to do pitches. We train them on what every discipline is in the industry and really try to help slowly build a network for them while they’re in high school and show them opportunities to be able to major in advertising and have internships throughout their career. Through MAIP we do it a number of ways. We have our fellowship program and that runs annually and we do a 13-week virtual spring training for all of our fellows before they even enter their internship at their agency. And that again trains them on what each discipline is. But then also we train them on some transferable skills and then how to navigate the industry, especially from coming from a diverse place. And then we have over 3,500 alumni that have gone through our programs since 1973. And what we do is we partner with agencies and outside companies to provide any type of personal development, professional development, networking opportunities. 

Adrian Tennant: Fantastic. Now can you talk a little bit about the process for students who may be interested in applying for the 4A’s MAIP program?

Reema Elghossain: Around the end of August and into mid-October, we have applications for students to apply to be part of our program. It’s for juniors, seniors, and grad students across the country and it’s a pretty extensive application process. And we ask for essay questions, the video, letters of recommendation and really just want to understand, you know, what they’re interested in the industry. We then give them a screening process. We do coach them on interview tips and prepare them through the process. And then we have our community of volunteers in the industry that really support our initiatives, who will interview them. And once they pass through all of those stages, they then become finalists. At that same time, our agencies are applying to host fellows for the next year. And then we have a huge selection kickoff where agencies will then make offers to their favorite top finalists and they place an offer and that MAIP finalist has the opportunity to accept or decline. If they accept and it can be anywhere in the country, then they now become a fellow. Once they become a fellow, we actually support the agencies by taking care of housing and travel for all of the fellows. And then again, onboarding them with that spring training. And an orientation to get them really immersed into the program before they even enter their internship.

Adrian Tennant: Well, that sounds very thorough. And do you typically have that kickoff in New York City, or does it change according to where the students are coming from?

Reema Elghossain: Sure. So the actual live kick off is in New York City, but we live stream it, we live stream it through our Facebook page, our main page, and through Zoom. And so all of our agency partners, all of the finalists are alumni community. A lot will sign in and be able to watch it happening live. And so it’s really exciting. We invite all of the finalists that are in New York to be able to attend and they get to receive their offers live, in person.

Adrian Tennant: Let’s change gears just a little bit. So with the visibility of the #MeToo movement, there’s heightened awareness of issues around gender inequality, bias, and discrimination within the workplace. And ad agencies have certainly not been immune from scrutiny. From where you stand, has #MeToo been a kind of a wake up call for the industry?

Reema Elghossain: I think absolutely and in a lot of different ways. I think it’s something that everyone is aware of, but no one really knew what to do. And so when that movement came around I think it woke a lot of people up in the industry. And I think one, it scared a lot of agencies because they were whispers before and then now it just became something where there’s actually some accountability that’s going to be happening. And so I definitely think it shook up the industry in a major way. And I think it still is in a lot of ways and it definitely shifted the understanding and awareness, I think for the talent and employees to realize what their opportunities were and having a voice and being able to know what their rights are. So I definitely think it impacted just the industry and, and from the top down.

Adrian Tennant: Traditional gender divisions and labels, the binary choice of male or female are being replaced with the more fluid concept of gender identity. Thinking differently about gender identity also has, of course, potentially significant impacts on the work an agency does for clients. Everything from consumer insights research and brand strategy through to creative and messaging. In this context, how well are agencies addressing these long held assumptions about gender?

Reema Elghossain: That’s a great question. It’s a conversation that’s becoming louder and it’s something that’s becoming more important. And especially I think when agencies are looking at their employees and saying, “we have to be able to create a safer space and a space that’s more open for, for all.” And so looking at their people holistically, I think is allowing them to also be able to work with clients and say, “okay, our consumers also need to be looked at in a holistic way as well.” It’s a conversation that is happening to support who works in the industry, but then because I think that inevitably will impact how they support clients and their consumers.

Adrian Tennant: In addition to gender bias, discrimination, and identity, what are some of the other areas that you work with member agencies on?

Reema Elghossain: A lot of things. So talent development. We also talk to our agencies about supporting them with how to have a more diverse workplace, how to be more inclusive of what systems they can put into place that can support that. We talk a lot about retention. We talk about, “how do we move diverse talent up the corporate ladder?” And then also “what are systems and initiatives we can put into place that really can support their employees there?” Number one to bring in talent, but then also to make it a place where the talent wants to stay.

Adrian Tennant: Right. Have you codified these into a set of best practices?

Reema Elghossain: Yeah, we’d like to work with our agencies to produce those best practices. We all have a lot of ideas and I think it really depends on where that agency is. But we have maybe smaller to mid-size agencies that are really just starting their diversity initiatives. They might not even have a lead person in their diversity, equity, initiatives. And then there’s the larger agencies that might already have a DNI lead or team and they have different needs at the same time. So we do have some best practices in place and it really depends on what the agency is. And then I have my own opinion.

Adrian Tennant: Ah, let’s get to those. You referenced the fact that the 4A’s includes holding company agencies – which I’m guessing are typically in the major metros -as well as independently owned agencies, many of which – like ourselves – are in smaller markets. How then do you apply variations in how differently-sized agencies identify and approach these kinds of issues?

Reema Elghossain: I think for me it would be just doing a little bit of research and talking to each agency and finding out what their needs are and out what they’re, even, what their budget is, and where to start, right? So if they’re talking about, “we want to focus on diversity, equity, inclusion, and the talent.” The first thing is how diverse is your agency? Now I don’t expect agencies to share their numbers, but what is your first goal? Is it one hiring diverse talent so that you can diverse, you know, add diversity to your pool? Or is it “we have diverse talent, we want to add more, but what can we do to be a more inclusive space?” And there’s definitely different needs when it comes to both. I definitely think every agency, whether it’s independent, small, all the way up to the to larger holding companies, all need to continue to hire more diverse talent. So that’s I think, a problem across the board. But depending on where they are and what their resources are, there are different ways that they can make a better environment.

Adrian Tennant: Specifically thinking about job candidates and young professionals, do you see any generational differences in how today’s young professionals maybe just starting out in the industry or have one or two years experience how their career decisions contrast or compare to older, more established workers?

Reema Elghossain: Absolutely. They are thinking of things that I never thought of when I was their age. They are thinking about, “what are your mental health and wellness programs that you have established at your agency?” They’re thinking about even things that might not even matter to them early on, but like, “what are your maternity and paternity leave programs? What is your work life balance?” They are thinking of things that are important to them that, I’ll be honest, at 37, I didn’t think of when I was their age and they’re holding agencies a lot more accountable. They’re looking at agencies and saying, “what can you do for me?” Not just, “what can I do for you?” I would say when they first get into the industry, there is that still that same fear and desperation of finding a job in a lot of places, especially for our MAIP, community. You know, as young people of color, there’s this fear of being able to find a job, but the questions that they’re asking are very much different. They’re not just, “what are the hours and the salary and the insurance benefits?” They’re also just asking about the experience, the environment. “Do you have any diversity inclusion initiatives? Do you even have a DNI lead? What programs do you have that can help support me? Do you have mental health? Do you have employee resource groups and do you have professional development opportunities?” These are questions that they’re asking and they’re also not afraid to be able to leave at a faster rate than, I would say, older generations. You know, they find a company and they want to stick with it for a long time. I think the young professionals now are saying, “if you’re not putting into me, I’m okay with getting up and finding a new opportunity.” And so I think it’s definitely forcing agencies to think a little bit differently about what they’re providing to their employees.

Adrian Tennant: Right. So to that point, continuing professional education, more the responsibility of the employer than the employees, is that fair?

Reema Elghossain: I think it’s a very competitive market right now. I think there’s a lot of young, amazing talent and I think the industry knows they’re losing talent really quickly. And especially because I haven’t been able to keep up with what other industries are doing from remote days to better work life balance to personal and professional development opportunities. And I think our professionals see that, I think they talk to each other and I think they know what issues there are. And so when they’re coming into interviews, they’re a lot more intentional with the questions they’re asking.

Adrian Tennant: Are you finding that younger professionals are considering freelancing right out of college?

Reema Elghossain: Yeah. I would say maybe after a couple of years, I think I’ve noticed that there are some of our alumni who have gone through the program maybe a couple years ago and they reach out to me a lot and they’re looking for freelance. I think they liked the comfort of being able to work from home, especially with industry that’s expected to work a lot more than 40 hours a week. And so if they are already planning to stay to do that, they want a little bit more freedom to be able to do that at their own time. This is definitely a non-conventional generation where it doesn’t have to be done at nine to five. It can still get done really well. And I think freelance is a really attractive option for them, especially because – and I can speak a lot more about our community -if they’re not feeling comfortable or feeling included at their agency, I think they would sometimes rather leave and leave some of that toxicity and be able to just work for themselves on their own and to be able to work on projects. And the industry is kind of set up so that it can do that. Right? You can work on a team, you can work on one project and then once that’s done, you can work on another one. And you don’t necessarily have to be, you know, um married to one agency to do that.

Adrian Tennant: Yeah. A great point. I just actually picked up some research put out by Statista. It says that there’s actually been a 78% increase in job posts mentioning workplace flexibility since 2016 and 37% of employees would switch to a job that allows them to work offsite, at least part of the time. And the trend, of course, being most pronounced among Millennial workers. That doesn’t sound too surprising based on what we’ve just been discussing.

Reema Elghossain: Yeah, not at all. I mean, I would love that too! I think there is a lot more flexibility in it. It creates a lot of space. I mean imagine you’re working until 10:00 PM at night and then to be able to come in at noon the next day. It does help prevent burnout. It helps prevent not just exhaustion but feeling overwhelmed. And I think it makes for more productivity. So I’ve seen a lot of other industries that I’ve been in that have been having more flexibility in that. And I just think it’s really beneficial and I think it’s almost necessary. I don’t know if the industry is even thinking about that just yet.

Adrian Tennant: Great discussion, Reema. Are there any resources that you’d recommend for people interested in pursuing a career within advertising?

Reema Elghossain: I read a lot of books on personal and professional development and I think that’s what I would suggest to any young professional. I read books from Eckhart Tolle or Michael Singer… 15 Steps for Conscious Leadership. Those I think are going to be great tools that are going to help set you apart in the advertising industry because I think it’s not just about your specific skill, right? I think people come into this industry with a certain craft and then they spend their entire careers perfecting that craft and you’re going to have all those opportunities to do that. And what I think is lacking sometimes as you continue to grow in that ladder but you don’t necessarily learn management skills, development skills,your communication skills and your styles, how to read and identify people. And I think what will set you apart and allow you to grow an industry is if you focus on a lot of those resources. And that’s usually the biggest advice that I do.

Adrian Tennant: Reema, that was great advice indeed. And we will include links to those resources on the IN CLEAR FOCUS webpage. For now, Reema, thank you very much for joining us today. Really appreciate your time.

Reema Elghossain: Okay. Thank you so much.

Adrian Tennant: As Reema explained, the 4A’s Foundation’s Multicultural Advertising Internship Program – or MAIP, for short – helps people from diverse ethnic and racial backgrounds enter the advertising industry. With some personal insights on what it’s like to go through MAIP, I’m joined now here in the studio by Bigeye’s Digital Marketing Specialist, Megan Trinidad, who is an alumna of MAIP. Welcome to IN CLEAR FOCUS, Megan.

Maegan Trinidad: Hello!

Adrian Tennant: Firstly, can you briefly describe your role here at Bigeye?

Maegan Trinidad: I am a Digital Marketing Specialist and that entails doing a lot of reporting and optimizations for our client’s campaigns.

Adrian Tennant: How long have you been at the agency?

Maegan Trinidad: I actually started as an intern in the Fall of 2018 but I joined full-time in May of 2019.

Adrian Tennant: And I should mention too that Megan actually created the Airtable database that we use to track every step of the production process for these weekly podcasts. So we’re very grateful for that – thank you Maegan. So thinking back, in high school, were you more drawn to liberal arts or STEM subjects?

Maegan Trinidad: Interestingly enough, I was more STEM. I wanted to be more creative so I feel that advertising and marketing in general was a way for me to bridge those two because I got to touch the creative side at least a little bit and help with my analytical and mathematical background as well as my research background.

Adrian Tennant: Perfect. So was it high school – was that the time when you have the idea that advertising might be something you’d be interested in pursuing as a career?

Maegan Trinidad: I think so. I think I knew I wanted to do a business major and when I learned what marketing was in high school, that’s when I decided to pursue that in college.

Adrian Tennant: When did you first learn about the 4A’s Foundation’s program?

Maegan Trinidad: So one of my family members is actually also a MAIP alumna and she’s the one who told me about it before I entered in my sophomore year in college. Because she noticed that I could benefit from the program and seeing what it was like to work at an agency because I didn’t necessarily know what I wanted to do with my marketing degree. So it was something that was worth a shot – and I ended up really liking working agency-side, which is why I did MAIP two years and ended up at Bigeye.

Adrian Tennant: What was the application process for MAIP like?

Maegan Trinidad: It involved several essays, a video interview, and after those were submitted, there were two further rounds of interviews.

Adrian Tennant:  Wow. I think you said you did the program twice.

Maegan Trinidad: I did.

Adrian Tennant: Okay. What was the female-to-male ratio like? I’m curious.

Maegan Trinidad: I feel like it wasn’t a stark difference, but it was a little more female, I’d say.

Adrian Tennant: Okay. You attended the MAIP events in New York City. What were they like?

Maegan Trinidad: I feel like they’re a really good experience. We got to go to several agencies, like Weiden and Kennedy, I believe. And it was interesting to see what different types of agencies looked like in their different organization styles because obviously we could meet the different people who worked there and we got to network with them and we also got to see what their space was like and they were all very different.

Adrian Tennant: Hmm. Now it sounds like there was some competition amongst agencies for interns on that MAIP program. Where did you intern?

Maegan Trinidad: The first year when I was in New York I was at MEC, which is now Wavemaker. And the second year I was in Chicago at Mindshare.

Adrian Tennant: So what did you personally feel were the most valuable lessons you learned from each of those internships?

Maegan Trinidad: To be adaptable, to be honest, when I went through MAIP, I was selected to be a media planner and media planning wasn’t my first choice. I wanted to be a strategy intern because I mentioned earlier that I have a research background and I wanted to see what that was like to apply in an agency setting. But working in media planning did allow me to see what else was out there and when I got to meet my teams at my agencies, they were very welcoming and they worked with what I felt were my strong suits. So they adapted what they had me do based on my desire to branch out and see how I could bring my skill set to the agencies.

Adrian Tennant: Right. Have you kept in touch with any of your fellow fellows?

Maegan Trinidad: My fellow fellows? Yeah, actually I’ve made really good friends during MAIP. That’s another thing I really enjoyed. Most of you guys are strangers when you show up to your host city and since you live together you get to make some really good friends. I made some of my very closest friends during mate. Unfortunately now they live across the country, but…

Adrian Tennant: Well at least you’ve got people you can go visit and possibly crash on their sofa.

Maegan Trinidad: … That’s what I say!

Adrian Tennant: So Maegan, what if anything, do you think either MAIP, or you could have done differently to enhance the experience?

Maegan Trinidad: I feel that MAIP has a really good structure already and the only thing that I would change about it would be offering more of the, um, they’re called MAIP Labs where every or most weeks you go to a different agency and they speak to a different topic. I would offer those in more cities. I understand that that’s not really a feasible option in some of the host cities but I feel that in some of the, some of the larger cities like LA, they don’t really have as many of those opportunities as they do in New York or Chicago. So I feel like I would make more of an effort to make more MAIP events for those places or make something supplementary to them. 

Adrian Tennant: Maegan, would you recommend the program to others looking to enter the advertising industry?

Maegan Trinidad: Oh, absolutely. And even interns here, if I see that they have an interest and they’re qualified to join the program and have an interest in specifically some of the disciplines that they have offered through MAIP, I talk to them about the program and tell them about the application process and what I went through. And if they’re interested, I offer to tell them more about my personal experience. And I was a MAIP Ambassador at UCF before I graduated. So I feel like I want to be a resource for other students and if they want to learn more, they can contact me.

Adrian Tennant: Perfect. Great insights, Maegan. Thank you very much for joining us.

Maegan Trinidad: Thank you!

Adrian Tennant: Thanks also to Reema Elghossain, VP of the 4A’s Foundation, responsible for talent, equity, and inclusion. You can find links to the resources we discussed on the IN CLEAR FOCUS page at bigeyeagency.com under “Insights.” Please consider subscribing to the show on Apple podcasts, Spotify, or your favorite podcast player. And if you like what you hear, please leave a review and a rating. And if you have an Amazon Echo device, you can use the IN CLEAR FOCUS skill to add the podcast to your Flash Briefing. Thank you for listening to IN CLEAR FOCUS, produced by Bigeye. I’ve been your host, Adrian Tennant. Until next week, goodbye.

References

• The 4A’s
• The 4A’s Foundation
• Book recommendation: The 15 Commitments of Conscious Leadership

 

Michael Schmidt, Managing Director of Strategic Innovations at Orlando Health, discusses creating a culture of innovation across a complex healthcare system on IN CLEAR FOCUS.

In Clear Focus this week: how to successfully create innovation competency and culture. Michael Schmidt, Managing Director of Strategic Innovations at Orlando Health, shares a practical framework for transforming ideas into startup businesses and commercial products. Michael speaks to the challenges of creating a culture of innovation across a complex healthcare system as well as the tangible benefits experienced by internal and external innovators, healthcare professionals, and patient communities.

http://directory.libsyn.com/episode/index/id/12694922

Episode Transcript

Adrian Tennant:     You’re listening to IN CLEAR FOCUS, a unique perspective on the business of advertising produced weekly by Bigeye. Hello, I’m your host, Adrian Tennant, VP of Insights at Bigeye, an audience-focused, creative-driven, full-service advertising agency. We’re based in Orlando, Florida, but serve clients across the United States and beyond. Thank you for joining us today. Over the past several decades, thanks to improved diagnostic and therapeutic options, healthcare has done much to improve life expectancy and quality of life. And the development of new diagnostic procedures , therapies, drugs and medical devices is something the US has traditionally excelled at. But within the next five years, the cost of healthcare here is predicted to reach 20% of GDP, so technological solutions and new approaches to delivery are of interest to many health systems. Managing systemic change is hard, especially when it comes to creating a culture of innovation. Joining me here in the studio today is someone with hands-on experience of managing just this kind of challenge. Michael Schmidt is the Managing Director of Strategic Innovations at Orlando Health, a network of community and specialty hospitals. Orlando Health is Central Florida’s fifth-largest employer with more than 20,000 employees and more than 3,000 affiliated physicians. Michael has built the Orlando Health Foundry, which develops internal ideas and concepts into startup businesses, or commercialized products, and helps to launch them across Orlando Health and the broader healthcare industry. Welcome to IN CLEAR FOCUS, Mike.

Michael Schmidt:    Thank you. Thanks for having me.

Adrian Tennant:     Mike, your title is Managing Director of Strategic Innovations. How do you define innovation?

Michael Schmidt:    People define innovation and specifically in healthcare a lot of different ways. The definition that has become my favorite. It’s actually from a partner of ours, Healthbox, based in Chicago. And I love it because it’s so simple. It’s “invention adopted.”

Adrian Tennant:    And why is innovation needed within an organization like Orlando Health?

Michael Schmidt:    So we’re at a really interesting time. 2018 was actually our 100th birthday as an organization so kind of at the same time celebrating the past and everything that we’ve accomplished and what it means to the Central Florida community, but also really looking to the future in the next 100 years. And how do we set ourselves up as a hospital system, caring for a broader community to make sure that we’re meeting the needs that the community has, but also making sure that in the increasingly competitive healthcare landscape, we are well prepared to serve those that you know, that we’ve set out to, to serve.

Adrian Tennant:     So Mike, how did you first arrive at the idea that has now become Orlando Health Foundry?

Michael Schmidt:    So we’ve had some fits and starts in terms of a formal innovation program. And so for a healthcare system of our size, that was really a gap. So not quite five years ago, David Strong became our CEO and he brought with him from his previous organization, a number of other senior leaders that now they formed the senior leadership team for Orlando Health. And I think pretty quickly realized that an innovation program is an excellent way to engage the workforce, especially the frontline clinicians and physicians who are directly caring for patients. So to not only make sure that we are tapping into the workforce to get the best insights and feedback on where change needs to happen, where product evolution needs to happen, where we need to to change our approach. But also to make sure that the workforce feels they have an outlet for those ideas when they come up with something, whether it’s a new product, purchase recommendation, or a completely new idea that someone’s come up with that solves some problems. And so we collectively surveyed a number of senior folks across the organization and asked the questions, “what would a, a good innovation program look like?” and “how should we include people from across the healthcare system to help us drive this forward?”

Adrian Tennant:     Excellent. So in establishing Orlando Health Foundry, what challenges did you face?

Michael Schmidt:    So I think one of the biggest challenges for me was initially I was a one person team. And with such a large organization that’s spread out so much it, it has been a bit of a challenge to get the word out to make sure that people know that we have the Foundry program. And then kind of taking it a step beyond that. What is this program? How does it work? How can people participate, engage with it? What types of ideas are we looking for? Things like that. So it’s been a bit of a learning process. One of the best things we do each Fall is we hold workshops at each of the hospitals. And so anybody’s able to come there. They’re a few hours long so it gives people a chance to kind of settle in, ask me questions, get an overview of what the program looks like, but then get real-time feedback on any ideas that they might be working on. And so I always take a step back and say, “how did you guys hear about this first and are there better ways that we can communicate to make sure that we’re reaching everybody who needs to hear about this program that has ideas?” And so I’ve gotten lots of great insights and feedback over time.

Adrian Tennant:     Is the program open only to Orlando Health employees and partner physicians, or is it open to everybody?

Michael Schmidt:    That’s a great question. So the way we’ve decided to set up our program is to focus both on the internal and external environment. So the Foundry specifically serves our internal constituents, so employees, which we call team members and our physicians. And so the Foundry is where they can bring ideas for new products or services that Orlando Health can develop and then commercialize and spin out after using them across our system. For our external focus, we actually have a dedicated investment fund, which many large healthcare systems do now. And so we do direct investing into healthcare startups whose products and services we like to use.

Adrian Tennant:     Right. So how do people with new product or service ideas generally engage with the Foundry? What does the process look like?

Michael Schmidt:    It usually starts at the workshops. And so the program does run on an annual cycle. And so we’ll do an internal kind of marketing campaign around the program invite people to attend the workshops. And so that’s the first chance for them to dip their toes in the water. And oftentimes people sign up but they’re not really sure what to expect. And initially they’re a little hesitant to share the idea. But I think once they understand that, you know, my team is here just to support them, they are, you know, they are my customers. My job is to help them succeed and help them take the next right step with their ideas. It’s always really encouraging to see how the conversation kind of unfolds.

Adrian Tennant:     So what can you tell us about the framework that you’ve developed to help innovators either define or refine those initial concepts that they bring to you?

Michael Schmidt:    Yeah, so the Foundry program itself, the actual accelerator portion it’s about a two month sprint. So most of the ideas that are brought to us are very early stage. It’s kind of a sketch on a piece of paper or a PowerPoint presentation as to “here’s how this thing could work if we were to build it.” So we realized that people were pretty early in the process in terms of developing a concept. And so what we’ve established in this is kind of Healthbox’s framework is a series of four modules. So we build an internal team. If we’re building a medical device, we’ll bring someone from clinical engineering, we’ll get a frontline clinician who’s actually gonna use the device. We’ll get someone from our IT team just to make sure that we have a well-rounded perspective as we’re developing this project, just to make sure that we’re not missing anything. And so that group stays together throughout the process. And so the first thing we do is kind of take a step back from the product or the idea and we really start to diagnose and take apart the problem that they’re trying to solve. We say, “you have to fall in love with the problem first.” That’s the first big step. And so oftentimes the innovator that’s brought the idea forward hasn’t fully thought through what exactly their idea or their product is fixing. And so we start to pull it apart piece by piece and say, “look at who exactly is this problem affecting what is, what else is happening further down the line, if we don’t fix it today, what happens? How urgent is it? What is it costing Orlando Health? Or what is it doing potentially to patient outcomes if we’re not solving this problem?” And so most of the time, once we’ve gotten that part kind of on paper and thought through fully, we realized that at least some aspects of the new idea don’t address part of that problem. So it’s a good opportunity for us to kind of reframe, make sure that the idea addresses the problem that we’ve diagnosed. And so once we get past that, then start to get into product design, start to look at the market landscape, where would this fit? Just to make sure that we’re carving out a niche for ourselves where we feel we could have some success.

Adrian Tennant:     Got it. So moving to market fit. How do you typically determine a concept’s commercial viability and validate the market opportunity beyond just Orlando Health’s needs?

Michael Schmidt:    Yeah, so the, the review process for the ideas that are brought to us is, is actually a bit of a lengthy process. So of all the ideas that are submitted, we review those internally. And I have a group of about 30 frontline clinicians, physicians, leaders that review all the ideas. And so what we look for collectively is which of the ideas really is something unique that’s not on the market? Or if it’s similar to something on the market, do we think that we could build this in a different way or approach it differently that could impact, you know, first and foremost, how we deliver healthcare at Orlando Health and then would that appeal to the broader market. So we have a lot of discussion around the merits of pursuing each of these things. Some really interesting ideas aren’t pursued because of what the market landscape looks like. Medical devices specifically have a very long runway for development. Going through the FDA is not easy. It’s very costly so we pick and choose the opportunities to pursue those types of projects based on how successful we think we could be. And then I always make sure that we’re not getting too far ahead of ourselves if we develop an idea that at the end of the day really just impacts how we do things at Orlando Health and helps us either improve our outcomes, decrease costs, reduce length of stay – the important metrics for a hospital. That’s fine. If it ends up getting to the market and is successful, that’s, that’s kind of a bonus. Just to make sure that we’re not getting too far ahead of ourselves. The average amount of time from the start of the program to when we anticipate something hitting the market – it’s probably between two to four years depending on what type of idea it is. So we just make sure to pace ourselves appropriately.

Adrian Tennant:     Okay. So talking about hitting the market, does Orlando Health automatically become a shareholder in any of the new ventures that have been nurtured through the Foundry framework?

Michael Schmidt:    Yeah, that’s a, that’s a great question. Different hospital systems approach that differently. For us, the Foundry program is designed to identify and build Orlando Health’s intellectual property. And so it’s one of the first discussions we have with innovators is helping them understand why Orlando Health needs to assume ownership of, of the IP. And it’s really just how easy it is for me to put resources and structure behind something. And you know, it’s not really about control. We leave the innovator really in the driver’s seat for the project. So it’s, it’s really to, to build up our IP portfolio and then what we do once something is commercialized. So we have a very generous royalty sharing approach with the innovators. So they basically get to benefit in the profits after Orlando Health has, has helped them get to that point.

Adrian Tennant:     Got it. Bigeye is a healthcare marketing agency, as you know. How do you approach developing those plans for growth? Particularly go-to-market strategies and those potential external funding requirements.

Michael Schmidt:    So it’s different for each project. You know, we really tried to, to start with a templated approach, but when we get to certain points, make sure that we are, you know, kind of designing and building and moving each idea along the right way. So medical devices, you know, we have some good you know, biomedical engineering partners that we work with that that’s their niche. They know how to, you know, illustrate these ideas. Rapid prototype them with three D printing, you know, run a pilot program and then get them through the FDA. So a lot of times those processes are already defined based on the partner. So we feel it’s, it’s really important early in the process to identify who those partners are going to be and then do our best to just kind of follow the process that they’ve used. It’s proven to be successful.

Adrian Tennant:     Okay. You mentioned earlier that you typically work in sprints. So have you fully adopted an agile project management methodology? 

Michael Schmidt:    Yes, we have in some instances. We don’t have a set approach really just because the projects are so different. So the four projects that went through the Foundry in 2019 that are in development right now: we have an iPad app to help patients who’ve lost their ability to speak in the hospital so it can speak for them based on inputs. We have a program that will, through some, some software connected to our electronic health record, will help pediatric patients transition into adult care. We have one that is, it’s really a pilot study to test how, how much we can reduce the risk of infection spreading in certain units by replacing the privacy curtains that are kind of standard fabric curtains with antimicrobial disposable curtains, just to see what the difference is there. And then the fourth one is a medical device which is built to irrigate wounds and the emergency department cuts and lacerations and stuff like that. So wildly different projects, completely different work teams, different partners that are helping us build or design all those things. And so again, it’s back to making sure we have the right team assembled and the right partners, helping us do these things and then figuring out which approach makes the most sense for that project and that team.

Adrian Tennant:     Right. And I feel you’re ideally positioned to help them with those go to market strategies, because I know that earlier in your career with Orlando Health, you directed digital media.

Michael Schmidt:    Yes.

Adrian Tennant:     Does your experience with digital marketing influence or has it influenced how you approach the development of the Foundry?

Michael Schmidt:    Yeah, it does. And you know, I think a lot of people that I talked to say, gosh, your career path has been so strange. But I really feel like it has prepared me for this, this role, this job. One of the benefits is I always have kind of the branding product, marketing hat or lens that I’m looking through. You know, which isn’t always obvious to someone who runs in an innovation program, but just kind of having that lens to look through as we’re developing, knowing how we should position and market these things once they do get to market to help them be successful. Even to the point of being able to help with website design and development, video production, to make sure that we are most effectively communicating how these things work. The other thing that’s been really integral to our approach is just how much we combine storytelling, and effective communication into the innovation process. I think one of the aspects of the Foundry that surprises our innovators is how much we focus on their pitch and how they communicate. Their idea, the problem it’s solving, things like that. I think they feel like it’s kind of ancillary. They’re ready to get into actually building the product and “let’s go test this thing.” One of the things we helped them understand is, “you’re going to have dozens, at least or probably hundreds of conversations about this product from now until it gets to market and you’re going to have to talk to all kinds of people about all kinds of things. The more effective you can be at that, the more successful your idea’s going to be.” And I’ve seen how infusing storytelling, really powerful storytelling, into that process just helps everything else be that much more impactful and meaningful. And by the time we get to the end of developing pitches and actually having people practice, you can see the dots start to connect in their head and they can see that they’ve become really effective at sharing what their idea can do and what they hope to accomplish.

Adrian Tennant:     Staying with your digital media background for a second, and Bigeye’s experience in medical device marketing. As you know, consumers are increasingly concerned about the potential misuse of their personal data, in part because of the Facebook and Cambridge Analytica scandal. Yet, at the same time, it seems as consumers we’re quite happy to share data via our Fitbits and Apple watches if we think that data will support our health and wellness. So working in a healthcare organization under HIPAA, which sets strict rules around the use of patient information, how do you balance HIPAA regulations with innovations in digital? And I’m thinking primarily about data-driven technologies.

Michael Schmidt:    It’s a great question and it’s something we talk about frequently and it’s something we take very seriously. I feel like every week I see some headline about another hospital system that’s sharing data or doing something and they end up getting into hot water because of how they managed it or because of how their, their patients or the public kind of perceives what they’re doing. That’s another aspect to it too. So kind of on a case-by-case basis, depending on what the project is, we think through what are the inputs that the patient may have here or what is it going to need to access. And then we make sure that we are talking to everybody internally who needs to have a say in how that’s managed, how it’s stored, how things are connected to one another. We’ve got a review process internally for software applications that need to talk to one another, things like that. And in general, I try to steer clear of getting into too much stuff that’s HIPAA-protected unless we absolutely need to. If there’s a way to test something without gathering and storing all those different identifiers, that’s the path that we try to pursue. But it is kind of a moving target and you know, people worry about some things too much and don’t worry about other things. Like you said, they don’t worry about ’em enough. And so consumers and patients aren’t always thinking about every bit of data that they’re sharing and where it’s going, but it’s, it’s kind of an ongoing conversation for us.

Adrian Tennant:     How do you create and nurture that culture of innovation within such a large organization?

Michael Schmidt:    Yeah, it’s, it’s a challenge. You know, I think my goal selfishly is that this program and our team grows continuously over the next few years just to make sure that we’re kind of meeting the demand that our team members have brought forward in terms of ideas that they have. For now, we’ve had to balance the volume of projects and the type of projects that we take on to make sure that we’re doing justice to the ideas that we’ve taken on to make sure that they have the budget and support that they need. But over time, I would love to have some kind of parallel work streams that can simultaneously tackle different types of projects. So software has its software and apps have their own work stream to kind of get the attention and support they need; medical devices; and so on. And that each of those would kind of have a dedicated team that’s continuously reviewing ideas that are brought forward. At some point too, we would love to have a physical space where people can come either just to start white boarding and thinking about ideas, you know, bring a team that’s working through something, really print a prototype or just get feedback as they’re working on stuff. I think that would really help bring the right kind of traction that we’re looking for across the organization. And then as we grow, it’s important that myself and my team continue to just make sure we have a presence at the other hospitals and not be so focused on the main campus. That’s one of the reasons that we do workshops at the hospitals, just to make sure that at least a few times a year people have an opportunity where they work to come sit and talk with us.

Adrian Tennant:     And just remind me – how many hospitals are there now in the system?

Michael Schmidt:    We have 10 hospitals and then a number of freestanding emergency departments. You know, a number of outpatient facilities, primary care practices, things like that.

Adrian Tennant:     Right. And I’ve seen, down by ChampionsGate, I’ve seen the sign, there’s something coming there as well.

Michael Schmidt:    Lots of new stuff popping up. We’ve been very busy on that front, so that’s exciting.

Adrian Tennant:     Alright, so working with startups in the Orlando Health Foundry, what has been the most rewarding experience for you so far?

Michael Schmidt:    For me it’s, it’s, it’s sitting down with someone who has an idea and the most consistent sentence I hear from people is, “I just don’t know what to do next.” They’ve had this idea sometimes for years talk to a number of people and just are kind of paralyzed because they’re not sure what to do beyond kind of sketching out what that idea looks like. So being able to help them take a step back and then give them a roadmap to follow step-by-step and just seeing the progress happen. You know, the first time someone gets ahold of, of their idea or see the, you know, the, the first rendering of what an app is going to look like, that joy and fulfillment that you can see on their face and you can hear in their voice, it is really rewarding. And for them just to know that they’re continuing to drive this thing forward and, and that’s what’s going to make it successful that they kind of stay in the driver’s seat. That’s really encouraging for me too.

Adrian Tennant:     Now, I think for me it would be a challenge to be seeing these other people making their ideas manifest. Do you have a little book somewhere of ideas?

Michael Schmidt:    No. And my wife is a pharmacist. She actually has several ideas that she’s talked to me about. So at some point we would love to make those happen. Yeah, I don’t know. I feel like just helping everybody else work on their ideas scratches the creative itch that I have. I’d like to do a lot of different stuff. And so working on the variety of projects that we do and helping people in so many different ways I feel is so fulfilling. I have yet to really come up with something completely unique on my own, but at some point…

Adrian Tennant:     Okay,

Michael Schmidt:    Well, we’ll see.

Adrian Tennant:     Well, we talked a little bit about how sometimes a career doesn’t appear to be a linear progression necessarily and yet each previous experience in some way contributes to the next and perhaps in retrospect you see an arc of some kind. 

Michael Schmidt:    I don’t know. It’s been a fun journey so far. I’m anxious to see where it leads.

Adrian Tennant:     Great discussion, Mike. Thank you. If our listeners want to learn more about the Orlando Health Foundry, where can they find information?

Michael Schmidt:    Orlando health.com/foundry is our Foundry website and Orlandohealth.com/innovation is kind of our landing page for the formal innovation program as a whole.

Adrian Tennant:     Got it. Mike, thanks very much indeed for joining us on IN CLEAR FOCUS today; really appreciate your time.

Michael Schmidt:    My pleasure. Thank you.

Adrian Tennant:     Thank you. What stood out to me from today’s discussion with Mike: innovation has really gone from being a nice-to-have to a necessity in an increasingly complex healthcare landscape. But creating a culture of innovation within Orlando Health has really helped attract and retain talent within the organization. And while concepts may differ wildly, it is possible to develop a framework to ensure efficient, successful exploitation of really life-changing innovation in healthcare. My thanks to Michael Schmidt, Managing Director of Strategic Innovations at Orlando Health. You can find links to the resources we discussed on the IN CLEAR FOCUS page at bigeyeagency.com under “Insights.” Please consider subscribing to the show on Apple Podcasts, Spotify, or your favorite podcast player. And if you have an Amazon Echo device, you can use the IN CLEAR FOCUS skill to add the podcast to your Flash Briefing. Thank you for listening to IN CLEAR FOCUS produced by Bigeye. I’ve been your host, Adrian Tennant. Until next week, goodbye.

References

• Michael Schmidt on LinkedIn
• The Orlando Health Foundry
• Orlando Health Strategic Innovations