Posts Tagged ‘marketing2.0’

Current advertising agencies make revenue based on a service model charged by number of employees it takes to deliver an agreed scope of work. All IP, thinking and work an agency does on behalf of its clients belong to those clients. Agency long term value is based on reputation, a portfolio of clients’ work and knowledge residing in individuals who might or might not leave.

There is no current ability to build massive data storage populated with agency owned data regarding what’s important to people, how they interact and make decisions. There is no ability to break down the FTE heavy structure and process inherent in making money to action campaigns in 72 hours or less. There is no ability to scale beyond tens of clients. There is no ability to use data collection to normalize between channels and determine a predictability regarding where and how to best spend marketing funds.

Agencies today develop client rosters based on cultural fit, revenue limitations, geographic limitations, reputation. Agencies don’t identify specific categories and set out to become experts in these categories as a cable broadcaster might, because there is no way of amassing long category term IP.

Agencies do not build and curate influencer communities within specific categories with the purpose of creating a category network that is ripe to consume and proliferate publishing.

….. but what if an agency were to throw the rule books out, starting with the business model and organizational structure

Flying home last Friday from the BMA Engage conference in Chicago, I was taken by the fact that my head was reeling from so many great keynote presentations. I attend and speak at a lot of conferences and while most have a lot of good content and networking opportunities, it’s rare that I find a set of keynote addresses that impress me, move me and most importantly, give me something I can act on when I get back to the office that will make my business better.

Several good cyber-journalists have already done a good job at recapping the entire event. Check out Barrett Sydnor’s “Top Ten Things I learned (or relearned) at BMA Engage 2010” or Sima Dahl’s “Personal Engagement: Bringing It Home” as well as exploring all the great content available on the conference site, www.bmaengage.com.

But at risk of contradicting my own first paragraph, it really wasn’t any individual keynote speaker or presentation that struck me, it was the underlying theme that permeated the entire event. From the body of work presented by Tom Stein of Stein Rogan & Partners, who won the B2 Agency of the Year award and Eduardo Conrado and David Srere’s “Engaging with Purpose” all the way through to Chris Brogan’s “Trust Advisor” and Jeffrey Hayzlett’s “Emotional Technology”, the single clear message I heard was that companies, brands and all the people who tell their stories, have to be honest, authentic and set the bar as high as possible in order to survive, succeed and prosper.

Eduardo Conrado, Motorola’s CMO, told us to throw out the mission and vision statements and get down to the heart of the matter that concerns both customers and employees, purpose. What is the purpose of the company? Why do they do what they do? This was echoed clearly by Jeffrey Hayzlett, the CMO at Kodak, who clearly stated that Kodak’s purpose is not to sell film (whose sales have dropped from $15B to $200m in the last 5 years), but to create memories. He showed videos of customers who said that in the case of a home fire the one thing they’d run back into the house for, would be family photos.

The highlight of the conference for me was Chris Brogan’s presentation from his book, Trust Advisor. His next to last slide was a simple illustration on the back of a blank sheet that says “Human Business”. To be successful, you need to focus of building the relationship first, “be there before the sale” and my favorite line of the entire conference, “bring wine to the picnic.” What could be more authentic than that?

AdAge magazine just released its 2009 annual agency report today, ranking all the top agencies by revenue and grouping them according to what may be dying distinctions like advertising, direct, media, digital, search and PR. Overall agency revenues were down 7.5%, “the sharpest revenue decline in the 66 years Ad Age has produced the Agency Report.” Although digital agencies overall faired a bit better, statistically gaining 0.5% over the previous year.

But what I find more interesting than anything else is that digital agencies, once considered the mavericks, the outsiders are now about as mainstream as possible if for no other reason than almost all of the top twenty agencies are owned by much larger agency holding companies. The true independents are becoming rare indeed. It started a couple of years ago with Publicis gobbling up Digitas. They have since acquired Razorfish as well. Blast Radius is a part of WPP and the #3 digital agency is IBM Interactive and we know nothing speaks independent more than being a part of IBM.

In fact of the top 20 digital agencies, only 5 are not owned by a much larger company. And of those, Sapient has merged with Nitro, Rosetta bought Brulant and iCrossing appears to become a part of the Hearst empire.

What does all this mean for independent agencies, for marketers and for consumers? Well, sitting in one of the top five remaining independent agencies, Ascentium, makes me feel like I’ve got a bull’s-eye on my back and I’m waiting to hear the M&A types pounding at my door. And perhaps that might not be a bad thing from a financial point of view.

Although for many us who have done both the big agency and the startup, we know why we went for the small option. It’s more fun, we get to work the way we want to and it frees up our creative juices. Frankly we produce better work because we feel like it. That’s the reason a lot of corporate marketers are turning more and more to independent and specialty shops; that’s where the ideas, the new technologies and the partnership mentality come from.

And finally, what about the consumer, do they care where marketing campaigns and experiences come from? Maybe not, but according to the latest from Forrester, watching advertising ranks lowest among consumers as a measure of influence, purchase intent and loyalty. And it’s the big guys who still make most of their money from these forms of traditional push advertising. So go figure.

I’m proud that Ascentium has made it to the #5 position among independent digital agencies this year. And I hope that demonstrates both our preference for going it alone and for our clients’ preference to work with an agency who considers their clients their partners, not their holding company.

Increasingly CMO’s are being brought into the technology buying process as technology is becoming even more intertwined with today’s multi-channel, multi-device world of marketing. And it’s up to us in the agency world who call ourselves trusted advisors to come to their aid.

It’s impossible to be a successful chief marketing officer (CMO) without becoming engaged in the understanding and decision making regarding technology. In a recent Forrester Research study, “The CMO’s Role in Technology Decisions”, David Cooperstein states that while “traditionally, marketing leaders treated IT as a foreign land that had a native language they didn’t speak… today’s marketers can’t afford to be lost in translation because digital channel embed technology in everything, marketing and the multi-channel customer experience are inextricably linked and fewer resources require strapped marketers to use technology to scale.” In other words, CMOs don’t really have a choice, either they need to learn the language of technology or they will not be able to compete in today’s digitalized, mobilized and socialized world of the interactive, integrated customer experience.

So who can help CMO’s learn the language of technology? Most (55%) look to their own IT departments , even though “strained” was the most common word to describe the typical relationship between CMOs and CIOs . And in smaller numbers, they look to their traditional agencies (21%) and management consultants (17%) for support. But almost half are looking towards their interactive agencies (49%) and their marketing services providers (44%) . And it is this audience that I believe has the responsibility to take the lead in helping CMOs navigate and make the smart business decisions that make the difference between leadership and falling behind.

But even within the worlds of the interactive agency or the marketing service providers, there are still large gaps in understanding what technology means for marketing and how to make the most of limited resources and the rapidly changing world of the customer experience. Most interactive agencies are either focused on online advertising or the increasing diversity of rich applications for platforms like Facebook or smartphones. While marketing service providers continue to concentrate on the silos of their own product’s capabilities despite the expansion of technology communities like Salesforce.com’s Appexchange or Omniture’s Genesis program.

At the risk of drawing the ire of my agency colleagues, I see the greatest opportunity in the hands of the emerging marketing practices of marketing consultancies like Accenture Interactive or McKinsey or the consulting arms of research organizations like Forrester or eMarketer. If CMOs have to be able to understand how technology will help them in the achievement of their business goals, then they need help from someone who first understands their business, their customers and how the complexity of the customer experience across all touch points can be influenced, optimized and in the end monetized.
And so it’s up to all of us in the agency world to embrace new roles as not just stewards of the brand, but as, business consultants who look equally to the worlds of creative, big ideas and technology as the best way to add values to our clients, the CMO. Because if we don’t step up to the challenge, someone else will.

1 Forrester Research, June 2009 Global Marketing Leadership Online Survey
2 Forrester Research, 2008 Partnering for Success: The CMO-CIO Relationship
3 Forrester Research, June 2009 Global Marketing Leadership Online Survey

I don’t ever like being critical of any of my peers, but sometimes, I just have to call a spade a spade. I just finished reading an article in Adage, entitled, “Our Biggest Brands can no longer be managed by nerds” by Tom Hinkes. His basic premise is that using data to inform marketing decisions somehow is responsible for the loss or the demise of CPG brands.

While I agree that “brand marketing is not a science, it requires analysis, discipline and detail. Even more, it requires intuition, flair and vision,” what I disagree with is the confusion between data and “numbers”. Using advances in market research, analytics and more recent social monitoring to listen to your customers, gain a greater understanding of what motivates them and responding to their needs/desires is not being a “bean counter”.

What made Starbucks a success was not that Howard Schultz ignored the research and went with his gut; it was that he was able to see the real needs/desires of his audience. They weren’t interested in coffee or soft drinks; they were interested in human interaction and a place where that could happen. And that type of insight is exactly what data and the successful understanding of data can bring about.

So I would counter that it’s some traditional brand managers who can’t see the forest for the trees and it takes a new more strategic business focused approach to be successful in today’s marketplace. So instead of being afraid of nerds, learn to listen and then apply the intuition, flair and vision that makes brand marketing as much art as science.

Last week, I had the privilege of hosting Marketmix 2010, a marketing conference held in Seattle and co-sponsored by the Seattle Direct Marketing Association, of which I’m the current president and the Puget Sound chapter of the American Marketing Association. The theme was mixology, which was the creative expression of our idea of presenting content and topics bringing together the various marketing disciplines and channels covering online, offline and emerging channels like social and mobile.

The event itself was wildly successful. It was very close to a sold out crowd and most of the breakout session were standing room only. The three keynotes of the day were about as representative of Seattle as possible. The day kicked off with Steve Jarvis VP of Marketing at Alaska Airlines sharing the stage with Andrea Schwarzenbach who drives Alaska’s interactive efforts. And the day was rounded out with the closing keynote given by Tom Vogl, VP of Marketing for REI. Both keynotes showed how brands are grounded solidly in customer experience and that the ownership of those experiences goes far beyond the marketing department. The presentations were recorded and I’ll update this post as soon as they have been posted.

But it was the lunch keynote that surprisingly left me with the most to think about. The speaker was Tom Douglas, Seattle’s resident celebrity chef, owner of five successful restaurants, a line of kitchenware on Amazon, a dozen cookbooks and appearances just about everywhere. I had the chance to talk with Tom before his speech and he asked me why we had invited a chef to come speak to a bunch of marketers. I said something about his having built himself into a successful brand and was really thinking to myself that he served as a break from the more intense marketing subjects covered at the conference.

As soon as Tom began speaking, I realized that not only had we picked a good speaker, but that he also had something to teach all of us wizened marketing experts. “You have to live your brand,” Tom told the crowd. Every day you have to be true to your brand or it won’t have any credibility and it won’t last. He also was very proud to say that he linked himself very directly with the Seattle brand. He represents what makes us unique up here in the Pacific Northwest; from our salmon to our wine and of course our addiction to coffee. Tom finished his talk, taking lots of questions, getting wonderful applause and unabashedly telling us to go out and eat and his restaurants. After all, building a brand is just a way to grow the business.

The next day, I was walking down the street in downtown Bellevue, on the Eastside. For those of you who don’t know the geography, culture and snobbery of Seattle, Bellevue is a former bedroom community whose population, wealth and skyline has exploded in the last decade or so. Like so many prosperous suburbs, it residents are well educated, have higher than average incomes, are generally transplants from the suburbs of some other metropolitan area and tend to like the more fashionable brands. True Seattleites tend to look down on Bellevue and it wasn’t so many years ago, it was referred to as the Californication of the Northwest.

To be fair to Bellevue, which is where my office is and where I spend a lot of my waking hours, it has matured significantly over the years and while still run the risk of being run down by BMWs, Lexuses or the occasional Ferrari if you actually walk on the streets, it is no longer the cultural wasteland we Seattleites like to think it is.

But back to Tom Douglas and living you brand. As I was walking down the streets of Bellevue, I walked past an Italian restaurant, an Irish pub, a Mexican joint and several flavors of steak and seafood establishments. All are respectable and offer quite an assortment of cuisines. But then I realized what they all had in common; they were all parts of national chains.

I could think of at least a dozen neighborhoods in as many cities, where I could walk down a block and find the same set of choices. That was nothing that spoke with any authenticity to the Pacific Northwest, there wasn’t a real Mr. Maggiano, they don’t really manufacture cheesecakes and I doubt I will ever meet the real Joey. In fact the only place I could think of that really was real, was the Twisted Cork, located adjacent to the Bellevue Hyatt. (Irony of irony, since I wrote this post over the last couple of days, Twisted Cork has gone out of business)

So Tom, thanks for sharing with us your brand, thanks for living it and I hope that your authenticity will survive the onslaught of artificial brands that serve us plastic food, with plastic smiles and not so slowly turn our unique identities into a 21st century high-end strip mall.

I am proud to welcome the newest addition to Ascentium’s ranks, David Blum who has joined in the newly created role of chief client officer. David has joined Ascentium after leading interactive for Butler, Shine, Stern and Partners, the Bay area advertising agency, named small agency of the decade by Adweek.
Not only does David bring tremendous talent, energy and experience to the job, but what is more important is what it represents to an agency like Ascentium.

Over the last few years, Ascentium has been steadily building a reputation as one of the nation’s leading digital agencies, producing great work for client’s like Microsoft, T-Mobile, Cisco, Precor and Samsonite. But being the best digital agency is only a milestone on the road to helping redefine what agencies should look like in the future.

At our core, we are an experience agency. We meld passion for big ideas with an obsession for performance that produces engaging experiences, not just on the Web, but across multiple platforms, channels and devices. And to do that, we need to take from what traditional advertising agencies do best; own the “big idea” and manage account relationships and fuse that together with what digital agencies are known for; innovation leveraging emerging channels, technologies and customer behavior.

David Blum’s arrival at Ascentium will help us do that. His experience at BSSP helping to win major AOR accounts like Priceline, Allstate, Greyhound, Columbia Sportswear, Chipotle, Epson and Radio Shack coupled with the work he did managing Razorfish’s web development group in Seattle. Give testimony to Ascentium’s commitment to going beyond digital and leading the evolution into a true Experience agency.

Check out the article in today’s Adweek online about David, www.adweek.com.

I read a very good and insightful article in today’s Adage, “Why Digital Agencies are Indeed Ready to Lead” by Jacques-Herve Roubert. I agree with his contention that Digital agencies are indeed ready to lead and as he points out, our company, Ascentium, is demonstrating that in fact with our relationship with Precor, but also increasingly so with some of our other accounts who are looking for to us for ideas and strategy and their traditional agencies for mass advertising.

The reasons for this are many and you pointed out some really good ones regarding where the energy, ideas and innovation is coming from. But the basic underlying reason is rooted in the business model of the big traditional agencies more than anything else. The traditional business model is based on revenue streams from media, not direct billable hours. This means that to be successful, agencies were forced into thinking about media as the prime distribution channel because that is how they make money. Digital agencies are not boxed in that way and as a result, they are able to look more broadly across channels and take a more customer-centric approach to communication than a media or product based approach.

Devotion to gathering customer intelligence across multiple channels online, offline and emerging social channels and then applying that to create customer experiences which produce trackable and measureable results is the key to our success at Ascentium and I believe that same can be said for the other great emerging digital agencies cired as well, like AKQA and TribalDDB. The big agencies are saddled with the innovator’s dilemma and while it won’t be the end of them, it certainly erects a big speed bump to innovation.

My company, Ascentium, was named by Forrester Research, as one of the top web design agencies in the country last summer. It was an honor and I think a fair reflection of some great Web sites we’ve been building. But at the risk of diminishing the importance of Web site, I believe we’ve entered a new era, when producing a great web site is not enough to have an effective web presence and to keep up with your customer’s digital experiences.

The other week, I had the privilege of speaking at the first annual Integrated Marketing Communications conference in Kansas City. My topic was the introduction of the Integrated Digital Experience concept. Its premise is fairly simple and does not represent rocket science. But like most important concepts, its not the understanding that’s difficult, it’s the implementation that’s hard.

I’ve uploaded my slide deck to SlideShare and in future posts, will begin elaborating on what IDE means and what are some easy steps to making it happen. Check it out at http://www.slideshare.net/jkottcamp/the-digital-experience .

I’ve been given the privilege of speaking on a panel at next week’s Digital Hollywood in Los Angeles. The topic is Consumer Privacy, Tracking & Targeting: Consumer Rights and Enhanced Technology and Commerce Services. I’m being joined by a great group including Dan Palmer, VP, Atigeo, Bant Breen, President, Initiative, Dave Morgan, CEO, Simulmedia, Michael Dougherty, CEO, Jelli, Shai Samet, CEO, Samet Privacy LLC, Jason Cieslak, Managing Director, Siegel & Gale and moderated by Mark J. Kapczynski, Chief Operating Officer, Kontrol Media.

I will be tweeting from Digital Hollywood as well as posting after our panel discussion. It looks like it’s going to be a lively topic and I’m excited to be participating.