MAGAZINE MARKETING THE SERVE ISSUE

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Customers are loyal to us right up until the second somebody offers them a better service.

And I love that.

JEFF BEZOS, AMAZON

THE SERVE ISSUE

A product is just a product, until you link it with your promotion, it then becomes a permanent advertisement for your brand.

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Marketers spend nearly $2 Billion a year on promotional products for one reason...

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FEATURES

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14 Amazon and customer service 20 Infographic the subscription economy 22 The convergence of agencies and consultancies 28 Infographic Amazon taking over 30 Data as a Service 34 Corporate Australia's growing appetite

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CASE STUDIES 70 Queensland Department of Energy and Water Supply Biofuels education ‘E10 OK?’ 74 Choice Hotels ‘Need a Break’ 78 Broadsheet and Honda ‘Seven Dinners in Seven Nights’

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38 Better living through service design 42 Customer delight management at Ferrari 48 Pictorial Australia’s finest hospitality spaces from the Interior Design Excellence Awards 54 Coopers at the Australian Open 60 Marketer profile Sue Zerk, 20th Century Fox 66 Community management and the machines

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BEST OF THE WEB

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CONTENT PARTNERS 19 SSI NPS Benchmarks: Transport 46 Marketo Where will you spend your boosted budget?

58 Forrester AI’s effect on customer service 64 APPA The best in promotional product marketing

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84 Editor’s choice Karen Monaghan 86 Most shared Scott Button 88 Most read James Boardman 84

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Contents

COLUMNS 90 Steve Sammartino Breaking the rules 92 Valos and Lee Industry-university partnerships 94 Sérgio Brodsky Self-service and time-service 96 Jac Phillips Servant leadership 98 Con Stavros The issue with service

Contributors

Publisher PAUL LIDGERWOOD Associate publisher LACHLAN OAKLEY lachlan.oakley@niche.com.au Editor BEN ICE ben.ice@niche.com.au Sub editor MADELEINE SWAIN Editorial design KEELY GOODALL Production manager ALICIA PINNOCK alicia.pinnock@niche.com.au Digital pre-press KARL DYER

Alvin Lee Page 92

Ben Ice Page 22

Con Stavros Page 98

Fiona Killackey Page 14

Graham Plant Page 30

Herbert Appleroth Page 42

Jac Phillips Page 96

James Boardman Page 88

Commercial partnership enquiries TYLER PAYNE Tel: +613 9948 4978 tyler.payne@niche.com.au CAMERON HALL Tel: +613 9948 4955 cameron.hall@niche.com.au Subscription enquiries Tel: 1800 804 160 subscriptions@niche.com.au www.marketingmag.com.au Marketing is a publication of Niche Media Pty Ltd ABN 13 064 613 529.

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Chairman NICHOLAS DOWER Managing director PAUL LIDGERWOOD Commercial director JOANNE DAVIES Financial controller SONIA JURISTA Printing GRAPHIC IMPRESSIONS Marketing ISSN 1441–7863 © 2017 Niche Media Pty Ltd. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, internet, or otherwise, without the prior written permission of the publishers. While every effort has been made to ensure the accuracy of the information in this publication, the publishers accept no responsibility or liability for any errors, omissions or resultant consequences including any loss or damage arising from reliance on information in this publication. The views expressed in this publication are not necessarily endorsed by the editor, publisher or Niche Media Pty Ltd. Niche Media Privacy Policy This issue of Marketing may contain offers, competitions, surveys, subscription offers and premiums that, if you choose to participate, require you to provide information about yourself. If you provide information about yourself to NICHE MEDIA, NICHE MEDIA will use the information to provide you with the products or services you have requested (such as subscriptions). We may also provide this information to contractors who provide the products and services on our behalf (such as mail houses and suppliers of subscriber premiums and promotional prizes). We do not sell your information to third parties under any circumstances, however the suppliers of some of these products and services may retain the information we provide for future activities of their own, including direct marketing. NICHE MEDIA will also retain your information and use it to inform you of other NICHE MEDIA promotions and publications from time to time. If you would like to know what information NICHE MEDIA holds about you please contact The Privacy Officer, NICHE MEDIA PTY LTD, 1 Queens Road MELBOURNE VIC 3004.

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Marketing would like to recognise and thank t Editorial Advisory Board for their invaluabl u n , n but not limited to Dr Michael Valos (chair), Car Rud ick, Erik Zimmerman, Mike Harley, Shannon Peachey, Trisca ScottBranagan, Skev Ioannou, Cameron Woods and Peter Little.

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JEFF BEZOS, AMAZON

THE SERVE ISSUE Michael Page 92

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Image courtesy of Amazon.

9771447245019

OCT/NOV 2017

Customers are loyal to us right up until the second somebody offers them a better service.

And I love that.

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n my absolute pleasure and vil ge to work on Marketing over t six years, the last four as editor d e past 12 months as associate isher. There aren’t many jobs ch you get to serve and meet h a diverse array of the smartest pe le in business in Australia and round the world. To the clients, c mnists, PR pros, writers, subi s, content partners, designers veryone who has helped make hi ublication what it is in all its rm ts: thank you. It’s not possible without you. And a huge thanks to my colleagues here at Niche Media – I’ve worked with dozens of incredible people, many of whom I can now call friends – with special thanks to Paul Lidgerwood for all the opportunities I’ve had here, Madeleine Swain and Keely Goodall. And, now, Ben Ice, who’s been paddling this boat for a while already, steps up to the helm this issue.

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Editor's note e outlined the topics for 2017’s issues (Versus, Intelligence, Generation, Culture, Serve) in July 2016. It was months later when Amazon announced its plans to start operations in Australia. Since that time, conversation and speculation has whipped retailers, marketers and media into a frenzy. It’s a little coincidental that as we reach going to print on our October/November issue, Amazon’s arrival is so, so close.

I’m not going to argue that great service is more important than ever. It’s always had the power to make or break businesses, even before social media shone a light on it and marketing departments got their hands on it.

The topic and talk of serve and service, on the other hand, has never been so hot.

Great timing for us – dreadful timing for those in ecommerce who’ve failed to heed the warnings: ‘streamline your CX or else’, ‘align your CX strategy with your data strategy or else’, ‘get creative with how you engage consumers’ rising expectations and diminishing attention spans or else’.

For those who’ve scraped by until today without doing so, ‘or else’ is about to take on a very real, very large physical shape. Is it too late to start playing catch-up? For some, absolutely.

The Amazon material in this article is detailed and insightful, and as timely as print publication will allow. No doubt in a few short months we’ll be able to look back at it and see where we got it wrong, because the fact is, just how this force – which has consistently

W

@marketingmag

THE SERVE ISSUE

Ben Ice Editor, Marketing.

disrupted markets the world over – will affect our market is impossible to predict, which is what makes it so interesting.

Service has transcended customer-facing interactions. Steve Sammartino says it well – it now encases the “sum of a brand’s parts”.

Sérgio Brodsky warns against the ills of finetuning it too much. Jac Phillips reminds all of us that we are never above it, no matter how high up the food chain we are.

Marketing professionals debate the existence of loyalty, some even mourn its death. I believe it exists and that, while it’s fleeting, it’s actually more important than ever. I also believe marketers who’ve written it off have already lost the battle. If we’re not striving for customer loyalty then our performance can be reduced to a list of quick wins and one-off sales that cannot equate to long-term success. Believe in loyalty and strive for it. It’s a beautiful thing. Just never take it for granted.

I’ll also use my first editorial column to thank outgoing editor, associate publisher and friend Peter Roper. For four-and-a-half years he’s produced an outstanding magazine of which I – and a long list of colleagues past and present – have been proud to be a part.

I also owe him personal thanks for training me up as a writer and editor on the magazine, while my career began in the subscriptions department (to our loyal subscribers: sorry if I bothered you on the phone in 2014 or ’15) – Ben

“Thinking further into the future, it’s not crazy to speculate about the creation of the world’s first AI ad agency.”

(86)

“Acquisition is easy, integration is hard.”

Serve (22)

“Community is a highly effective silo-killer.

Individualise an experience excessively and those silos shoot back up.” (66) “Automation advancements are pointing towards Doomsday for brands.” (94)

“Delivering destinational brands and a range of food experiences from fast-casual to fine dining in a quality setting is transforming our office portfolio.” (34) MARKETING OCTOBER | NOVEMBER 2017

/sԥ‫ޝ‬v/

Verb 1. Perform duties or services for (another person or an organisation).

1.1 Provide (an area or group of people) with a product or service.

Origin Middle English: from old French server, from Latin service, from servus ‘slave’ Source: Oxford English Dictionary

“Service design is an approach and process built on a very simple philosophy: the person is central.” (38)

marketingmag.com.au

“People aren’t always clear about what’s genuine or authentic and real, or not.”(54)

@marketingmag

“In anormal family,itis blood thatis the common bond.In the Ferrari family,the common bond isthe passionfor beautiful, hand-made dream machines.” (42)

“Air travel has always been a fascinating market because you have to both build a brand, so people like you, and be responsible, so people trust you.”

(60)

“When teams from diverse organisations collaborate strategically, creative thinking escalates, productivity improves, energy lifts.” (84)

“Commercialisation of data is not easy. It’s doable, but not easy.” (30) “The contrast is complementary: business focuses on doing, while academics are afforded the luxury to think through the intricacies of concepts more deeply, so that business can do it better.” (92) “The best experiences I’ve ever had with any firm are usually when someone in the organisation had the courage to break some rules.” (90) THE SERVE ISSUE

“Someone wise once said, ‘If serving is beneath you, leadership is beyond you.’ It sums up servant leadership well.”

(96)

14 FEATURE

Keep them smiling

t Amazon, the customer is king. From ensuring head office staff have call centre training and regularly visit fulfilment centres, through to making heartfelt apologies when it makes mistakes and using cutting edge technology to personalise every single email, Amazon has consistently placed the customer at the centre of its business. When the brand started two decades ago, founder Jeff Bezos would keep an empty chair at key meetings to represent the needs and wants of the most important person to the business – the customer. So great is the power the Amazon customer yields, that customer service staff are authorised to pull items off the (virtual) shelf should just a handful of customers complain about the same product.

No negotiation takes place with the category buyers or marketing teams (who may well have scheduled that product to be on homepage banners or in key emails); the item is simply removed until the department and/or brand can adequately respond to the customer complaint. Staff must “consider the customer then work back” when formulating new offers or suggesting changes to policies or procedures, and the brand continues to raise the bar for product innovation, from AI (artificial intelligence) assistant Alexa through to its Dash Button – a Wi-Fi connected device that allows customers to re-order household items without touching their phone or laptop.

Given its reputation as the world’s most innovative and customer-centric business, what impact will Amazon’s arrival have on Australian businesses, many of which have stayed complacent in the face of changing technology and influx of global brands setting up home down under?

Actions speak louder than words You are what you do, not what you say you’ll do. One of the biggest shifts local businesses may need to make is matching their marketing promise to their real-world delivery. Amazon is an ‘always-on’ business, with staff available around the clock to answer customer complaints via call centres, online chat services, an in-depth FAQ section and email. The Australian consumer may well compare this level of care to a brand like Officeworks, which has received multiple complaints via social media for not living up to its ‘next day delivery’ promise, with some customers waiting up to five days for products, and complaining of vague and inconsistent contact information on its website.

Earlier this year, Jetstar was voted the worst airline in the world for customer satisfaction, after a study of 11,000 passengers and 73 airlines was conducted. Customer complaints varied from delay times through to lack of transparency between marketing messages (cheap flights) and associated terms and conditions.

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How will the arrival of the world’s most customer-centric business impact the way local brands serve their customers? Fiona Killackey investigates.

Our customers are loyal to us right up until the second somebody offers them a better service.

And I love that. It’s super motivating for us.

JEFF BEZOS, AMAZON

Who’s doing it best?

Adopt a customer-first approach

BRAND: THE ICONIC CUSTOMER SERVICE INNOVATION: THREE-HOUR SAME-DAY DELIVERY

For some local businesses, Amazon’s arrival will have little impact, as creating a quality offering for their target audience and delivering an impeccable service has been part of their business from day one.

“When we launched in Victoria in 2014, our aim was to provide customers with access to information and choice where it had never been available before,” says Catherine Anderson, head of marketing for Powershop – Australia’s greenest energy provider. In an industry renowned for poor service (lengthy wait times to offshore call centres, excessive late fees and bill shock), Powershop was able to present a new offering. “We were one of the first retailers to have no lock-in contracts or exit fees,” says Anderson, “We were also the first to develop an app and online portal that presented usage information to customers, which enables them to make informed decisions about their electricity consumption to help them save money and reduce their impact on the environment.”

One of the biggest frustrations with online shopping is not being able to have items ‘immediately’. Understanding its target audience’s want for new fashion now, The Iconic introduced a three-hour same-day delivery service, as well as Saturday deliveries. “No one thought that this could be done,” says CEO, Anna Lee. “But our commitment to logistics innovations has set new benchmarks across all industries.”

BRAND: AMAZON CUSTOMER SERVICE INNOVATION: WHISPERSYNC Amazon’s Kindle changed the way people consumed books. Understanding its customers used both e-book readers and audiobooks and may wish to switch between the two (i.e. when moving from a car to a train), the company created Whispersync – technology that keeps your place in a book for you, regardless of whether you’re using a Kindle device or listening to the professional Audible narration.

BRAND: THE RITZ CARLTON CUSTOMER SERVICE INNOVATION: EMPLOYEE ‘SERVICE’ EXPENSE POLICY The Ritz Carlton is renowned for its mission: ‘We are ladies and gentlemen serving ladies and gentlemen.’ What’s less well-known is that the business allows any employee to spend up to $2000 without seeking approval to purchase something that improves a guest’s stay (such as a new raincoat or gumboots for unusual weather, laptop chargers or a new mobile phone).

Change your thinking Changing the way you think and talk about your customers is vital in delivering quality service, says Iain Nairn, CEO of stationery brand, kikki.K. “One of the most recent changes we have made has been transitioning our terminology of ‘customer’ to ‘guest’ to better reflect the way we would like to treat people visiting our stores,” says Nairn. “Rather than viewing them as a customer – someone who pays for goods or services – our entire team has started considering them ‘guests’ – people we welcome into our store like our home.

People who visit for an experience, who may take home a product or partake in a service that inspires and empowers them to live their best life every day.”

In the same respect, says Nairn, kikki.K staff refer to ‘sales’ as ‘solutions’, “because that’s really what we’re offering our guests”. Guided by delivering a ‘world class experience’ at every touch point, kikki.K staff are also encouraged to go ‘above and beyond’ for their ‘guests’, which, says Nairn, could be as simple as offering to help them with their bags of shopping or surprising them with a gift. Every store shares an ‘above and beyond’ experience daily in their end-ofday reports and this information is also funnelled into the head office. Tools like Mystery Shopping Surveys and Net Promoter Score are utilised by kikki.K, alongside feedback from the shop floor, social media, emails and “even handwritten letters we receive at our global support office”, which Nairn says guides the brand’s offerings. “Delivering world-

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16 FEATURE

Jeff Bezos would keep an empty chair at key meetings to represent the needs and wants of the most important person to the business – the customer.

@marketingmag

Jeff Bezos

class experiences in-store is more likely to result in stronger guest solutions, and our teams are tracking and measuring these KPIs daily.”

Consistent information for all staff One of the key ways Amazon’s marketing teams are kept informed of all and any customer complaints is through online ticket portals such as JIRA, which account managers and marketing staff can access and to which they can add commentary. Keeping lines of communication open between those who pull your audience in through marketing and those at the coalface is essential in providing consistently high levels of service. Marketing calendars should incorporate customer service activity, whether that’s a series of ‘surprise and delight’ activations, weekly updates to service, retail and CRM teams or pre-scripted response registries for new collections, launches or events. Most of all, marketing departments – along with everyone else in the business – should understand on a weekly, if not daily, basis what the biggest concerns are for their customers, then focus on addressing them.

“We focus a lot on cross-functional collaboration and communication within The Iconic,” says Anna Lee, CEO of Australia’s largest online fashion and sportswear destination (The Iconic boasts a million customers and 10 million site visits per month). “From weekly executive team stand-ups to daily huddles and scrums, we make sure all departments are working together. When everyone in the business has consistent information, they can be empowered to suggest ideas or make changes to ensure customer satisfaction.” One of the tactics Lee and her team utilise to ensure transparent communication is to regularly have head office teams visit their fulfilment centre.

“We recently moved to a new fulfilment centre in Yennora in Western Sydney, taking our capacity floor space from 12,000 square metres to 20,000,” says Lee. “This not only supports our strategy for growth, but was also essential for us to scale our operations to keep up with customer demand. We have team members from various departments – whether it be tech, finance or category management – come to Yennora every week to spend time on the fulfilment centre floor, to understand processes and how we can make improvements.”

THE SERVE ISSUE

18 FEATURE

Amazon is renowned for impeccable customer service and its arrival into the Australian marketplace will force local businesses to make some major internal changes. Here are four quick ways to increase your brand’s service offering:

1. CONSISTENT MESSAGING Make sure everyone in your business, from those on the shop floor through to social media moderators, are speaking the same language when it comes to offers, discounts, refund policies and contact information. Utilise pre-scripted response registries or an intranet to ensure consistency.

2. BE AVAILABLE We live in an always-on, connected society. Make sure customers can contact your business at a time when it suits them. That may mean operating call centres after business hours, implementing instant chats online or increasing your community management staff.

3. STAY TRANSPARENT In 2009 when Amazon was blasted for removing illegally sold copies of 1984 and Animal Farm from users’ Kindles, Jeff Bezos traded traditional corporate speak for a heartfelt apology, stating their solution to the problem was “stupid, thoughtless” and “wholly self-inflicted, we deserve the criticism we’ve received”. When you make mistakes, apologise and move on.

Customers will respect you for doing so.

4. ASK FOR FEEDBACK From leaving product reviews to instant chat, Amazon’s audience is encouraged to leave feedback at every point in the buyer cycle. Look at how your business does (or doesn’t) allow for customer feedback and how you can use this information to inform change.

When everyone in the business has consistent information, they can be empowered to suggest ideas or make changes to ensure customer satisfaction.

ANNA LEE, THE ICONIC Meet customers where they are Despite Australia boasting one of highest rates of smartphone penetration in the world, many local businesses still lack responsive websites or mobile-first email marketing designs. “We’ve had a 42% increase in mobile traffic annually, so we’ve built our digital platforms around that,” says Lee. “We know customers browse and shop across multiple devices and they expect that to be seamless, so we’ve made sure The Iconic has one of the fastest load times in Australian ecommerce.”

Energy provider Powershop adapts its offering according to customers’ needs. “We survey customers and listen to customer feedback so that we can continue to improve our service,” explains Anderson. “Some of our new customer initiatives are a direct response to customer feedback. For example, we are currently trialling a solar advisory service for our customers after they told us they want more information about how they can benefit from installing solar panels.”

Customer service is no longer a field delegated to an offshore call centre or single in-house department. If Amazon has taught businesses anything it’s that ensuring the customer comes first – from your marketing promises through to logistic processes – makes for sustainable growth. Gone are the days when brands spoke at customers or held the power to push products and services at a time that suited the business. Today, customers expect communication to be tailored and considered, and that products and services are available at a time and on a device that best suits them. It’s this change in power structure that Amazon’s creator, Jeff Bezos, finds exciting. “Our customers are loyal to us right up until the second somebody offers them a better service. And I love that. It’s super motivating for us.”

Fiona Killackey is a Melbourne-based business and marketing consultant and ( full disclosure) has worked for Amazon and complained about Officeworks on social media.

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22 FEATURE

CONVERGENCE AND THE FULL-SERVICE ARMS RACE The changing needs of marketers and brands has given rise to the demand for full-service offerings from agency and management consultancy partners, leading to mergers, acquisitions and talk of convergence.

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n Marketing’s July 2012 issue, a feature titled ‘Digital Darwinism’ discussed how agencies found themselves competing against a wider range of firms, how a culture of ‘big data’ was invading organisations, and how the power of digital was being recognised in the boardroom. Agency and consultancy professionals interviewed at the time predicted a landscape where agencies would take a more active role in the end-to-end development of

client campaigns, where marketing teams would work more closely with tech departments, and even where the digital agency would evolve into the experience agency.

Fast-forward to 2017, and big consultancies are getting bolder and bolder in their efforts to provide creative media and content solutions to cater to an evergrowing list of requirements.

Similarly, in a consumer landscape where traditional media advertising forms a smaller and smaller portion

Acquisition is easy, integration is hard. of fragmenting marketing mixes, and where campaigns are expected to be built on a solid foundation of consumer data, the ad agency model of old has given way to firms that offer a wider range of services and closer client collaboration.

This year alone we’ve seen a lot of big moves. In May, Accenture purchased one of Australia’s largest independent creative advertising agencies, Sydney’s The Monkeys, and design business Maud. In August, PwC bought a majority share in Thinkerbell, an agency that only officially opened in June. Also in August, Isentia shut down King Content (the content agency it had acquired in 2015 for $48 million) due to poor performance.

So, despite the apparent demand, success is far from guaranteed. Corporations are investing significant sums in the race to bolster their set of skills, but what’s standing in the way of success?

The convergence of consultancies and agencies – and the mergers and acquisitions, successes and failures that dot its timeline – is not a new trend, but it’s big moves like Accenture’s and PwC’s that have many saying it’s closer to being complete, that the roles of ‘full-service’ firms on both sides are closer than ever to being one and the same. “It’s not that we’re trying to create a new trend,” says Patricio De Matteis, managing director at Accenture Interactive Asia Pacific, “or a new model.

“It’s clear that our clients are looking for something new, our clients are looking for that integration.

“As forms of interaction keep evolving, our clients need to keep evolving.”

In the last five years, says Jason Dooris, CEO of Atomic 212, agencies have begun positioning themselves as business partners to their clients. “Partners who focus on understanding the key dynamics of what drives their clients or holds their business back,” he says. “The difference today is that we’re actually having to do that, whereas in the past we’ve simply used that language.”

Until recently, agencies have been vocal about their desire to work closely with clients, and become more involved in understanding their business, but nobody really invested or made hires in that space, Dooris says.

“The intent was very good” – identifying client needs.

Clients’ businesses have in the last five years, says Dooris,

dramatically streamlined, “with IT coming closer to marketing because of digital, and marketing departments going from a 50-person department to a seven-person department.

“All of these different things – bringing CRM closer, bringing technology closer – have meant that clients’ marketing offers, that typically connect to the agency offer, have completely changed.

“But the agency offers haven’t changed that much. You can see that if you look at a structural diagram of staff that are employed by your average agency. They’re very similar to what they were five, 10, 15 years ago.”

Client needs, of course, have changed, and that has created a gap for someone to fill. “Who else is there out there that has a point of view on business in general, and is equipped – in theory – to take a problem and solve it? The management consultancies in that space, which are very evidence-based and have problem solving as part of their business model,” he says.

Changing client needs are a reflection of changing consumers, and technology, connectivity and data have played no small part. Brands today are committing to providing a seamless customer experience across all touch points.

It’s for this reason, says Rob Pardini, chief data scientist at WPP AUNZ, that consultancies with significant footprints in digital CX (customer experience) are more appealing for brands.

“The work being done by consultancies – whether it’s at a strategic level or a CX level – has become more important over recent years and, in my experience, is something that clients are much more focused on than they were a few years ago.”

That is: understanding that consumer experience should be fuelled by data for clients that are leveraging the potential and the opportunity that goes with the customer data assets currently available, and that in itself should be laddering through all the touch points, irrespective of who is working on them,” Pardini says.

Agencies, like everyone else, are looking for new opportunities and new revenue streams. “Content today is being created by people in their lounge rooms,” says Matt McGrath, CMO at Deloitte Australia. “It’s also being created by media companies. You can go to Snapchat, for example, and they’ll create you a campaign. You can go to Channel Ten or Seven, and they’ll create a campaign for you.

“Creative is coming from different sources, so it’s natural for agencies to try and broaden their scope. Consultants are

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24 FEATURE

doing the same thing, and that’s where the convergence is coming from,” he says.

Accenture Interactive Asia Pacific's Patricio De Matteis says, “Clients are voicing more and more the need for integrated capabilities.

“We are uniquely positioned to bring creative brand strategy, creative service design, digital marketing service, and digital technology at scale,” he adds, of his brand, which has made a number of key acquisitions in recent years.

‘Full-service’ solutions

@marketingmag

“Full-service is one of those terms that’s been going around for a long time,” says Agostino Giramondo, sales and strategy director, OEM (original equipment manufacturer) and media at Carsales.com.

“There is always an appetite for full-service,” he says. “If you’re shown a way that everything can be done through one area, then you’re going to look at that favourably.”

Consultancies are, says Giramondo, “romancing” the CMOs. Using his own industry as an example, he says consultancies see the opportunity to layer support to companies, which may struggle in the creative and media space, and may be nervous about agencies.

Creative is coming from different sources, so it’s natural for agencies to try and broaden their scope. Consultants are doing the same thing.

“More manufacturers are now appointing CMOs who are qualified marketers,” he says, but this has not necessarily always been the case.

“For a long time, the person who’s been the marketing head at an OEM is more than likely someone that’s moved up through the ranks and was once in planning, once in sales,” as opposed to someone with a marketing background, and that’s where consultancies have seen opportunity.

“They’re talking to people who are actually rather naive in the whole marketing game. That’s why they’re moving in.”

More frequently, manufacturers who today appoint staff with marketing backgrounds, see that new hires bring more experience of agency relationship dynamics.

These experienced marketers have been hired to manage brands and campaigns and are less likely to be 'seduced' than marketers from different backgrounds.

Cultural cringe Isentia’s recent shutdown of King Content is testament to the fact that acquisitions can be risky, and success is far from guaranteed. Ogilvy Australia CEO David Fox says it’s got a lot to do with culture “Acquisition is easy, integration is hard,” he warns.

When consultancies purchase creative firms, they purchase a culture, too.

Consultancies making acquisitions must change models that they buy to extract higher margins, to guarantee a return on investment.

“The minute you start tinkering with it – the staff, the culture – it shifts slightly. It changes the whole culture of a lot of creative companies. You’ve fundamentally changed the reason you bought that company.”

“A lot of the time, they tinker with the model, and it fails.”

“Culturally, you’ve got an accounting type consultancy firm buying one of the most creative agencies in the country.

It’s much more difficult than just buying a design agency and leaving it be.

“People leave.”

Despite the inherent risks of acquisition strategies, these really are the only successful ways, believes Fox. “Is it the right thing to do? Absolutely.

“To start a design agency, or a creative agency, or a digital agency from scratch, you’re left out of the game. It takes too long.”

“Acquisition is the right strategy, particularly if you’ve got money in the bank. Just don’t underestimate how many times it’s been done and failed, due simply to the inability to integrate cultures.”

“How do you retain that superstar staff that you bought, that are very creative, and how do you keep them now they’ve suddenly become part of a management consultancy?

“Very difficult,” he concludes.

Accenture is a key current player in the discussion. It acquired Fjord in 2013 and The Monkeys and Maud this year.

De Matteis is not so concerned by cultural clash, since his brand as it currently stands was borne out of a number of acquisitions. “Mergers and acquisitions and cultures within cultures... have been part of our DNA for the last 14 years,” he says.

THE SERVE ISSUE

26 FEATURE

Competition and threat So, should agencies be threatened by these management consultancy moves?

“Of course,” says Fox. “I wouldn’t be as arrogant to think that they’re not a threat, because there are smart people in there.

“We take that threat quite seriously. It just sharpens us.”

“I wouldn’t say we feel any sense of competition with, say, a

…people are talking about them now, and saying, ‘wow, they’re all doing stuff, this is exciting,’ but actually they’ve been doing it for 10, 15 years, so they’re not fast at all.

Monkeys/Accenture,” says Will Halliday, executive strategist at George P Johnson (GPJ) Australia.

Halliday’s in a unique position to comment, having worked at consulting groups – such as Accenture and PwC – and also at agencies – including Host, Wunderman and Imagination.

“There are certain skill-sets we have that those guys just don’t have,” he explains.

While consultancies don't necessarily pose those a threat, he believes agencies such as his can learn a lot from management consultancies. “There is a lot to learn from them in terms of justifying our ROI for our client budgets,” he says.

“We need to be more rigorous about our measures of success and making sure that we can prove what we do is actually effective, something most event and experience agencies have been pretty lame on to be honest, and need to up their game. We’re investing in data.”

Atomic 212’s Dooris is a little more confident. “I see them as a slow train coming towards me,” he says of management consultancies.

“My personal view is they will fail,” he says, “because they’re so slow.

“It looks like they’re fast, because people are talking about them now, and saying, ‘Wow, they’re all doing stuff, this is exciting,’ but actually they’ve been doing it for 10, 15 years, so they’re not fast at all.

“They’re actually diabolically slow… because their appetite for risk is really, really low,” he says.

“We see there’s a massive opening for consultancies,” says Carsales’ Giramondo, “but if we know agencies well – and we do – they fight back really quickly.

“There’ll be some disruption, there’ll be some wins, but usually advertising agencies are very good at responding.

“The good ones survive, and the casualties are the ones that probably shouldn’t have been in business in the first place.”

MARKETING OCTOBER | NOVEMBER 2017

marketingmag.com.au

“We’re not new to bringing in new talent, new capabilities and larger cultures.

“It is a fine balance, and we don’t take it for granted.”

His recipe for success involves giving each company and culture an opportunity to be itself, and an opportunity to succeed in the marketplace independently.

“We work on it every day, those communities of practice are connected across our studios, and connected across our client engagement.”

He wants Fjord and The Monkeys to continue to work autonomously. “They’re brands within brands,” he says.

Just months into The Monkeys acquisition, he’s excited about the way integration is tracking.

“We’re already working on new client pitches as an integrated business,” he says, “and we’re also bringing Fjordians into their practice to work with their design capability.”

Plans are underway to expand The Monkeys with a Melbourne office, “something that we’re going to treat as an acquisition in itself,” De Matteis adds.

David Angell, general manager and head of media at TrinityP3, also recognises that acquisitions and mergers can cause cultural problems.

They have the potential to “disturb existing client relationships, reduce nimbleness of creativity, and actually result in a departure of talent,” he says.

On the other hand, he says – under the right circumstances – an increasingly diverse range of skill-sets, and more resources can potentially result in an increased ability to secure and retain top talent, a ‘pro’ for clients.

Another ‘con’ for clients he points out is the possibility of an escalated cost model across core agency services. “Any margin pressure placed on an agency by a new consultancy partner or parent may end in the client being asked to pay more for core services and outputs,” he says.

“It is hard to imagine that consultancies paying millions of dollars to acquire agencies will not want to maximise their ROI.”

27 SURVEY PARTNER: SSI

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Australia

New Zealand

30

25

Net Promoter Score

20

15

26.2 22.7 10

18.2 12.7

9.8

5

0

24.2

11.3

9.8

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0.5 -0.7

-1.1 -6.8

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-10 Domestic airline

International airline

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Retail travel agency

Corporate travel agency

Online travel agency

Cruise operator

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THE SERVE ISSUE

HOW AMAZON IS DISRUPTING JUST ABOUT EVERYTHING With Amazon’s Australian l u it’s pting retail, emergin inn e technologies and g

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MARKETING OCTOBER | NOVEMBER 2017

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THE SE VE ISSUE

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30 DAAS

DAAS WHAT I’M TALKING ABOUT ave you heard about Data as a Service (DaaS)? You may have heard of its cousin Software as a Service (SaaS) or brothers Platform as a Service (PaaS) and Infrastructure as a Service (IaaS). And, of course, there is Big Data as a Service (BDaaS) – riding the wave of Big Data hype.

H

SO WHAT IS DAAS? DaaS is described in a number of different ways depending on to whom you talk and what your Google search throws up. Today, DaaS is described as a cloud-based solution used to facilitate the accessibility of data in a timely, secure and cost-effective way. DaaS operates under the premise that data can be supplied to users on demand, irrespective of any organisational or geographical separation.

The shift of data to cloud-based databases (i.e. DaaS) incorporates features offered by cloud-based technologies including scalability and enhanced efficiency.

Organisations leveraging huge amounts of user generated data, combined with large structured databases with access to new technology, are key factors contributing to the growth in the market.

I’ve been working in the data space for a significant period. And while the term DaaS has only recently received some serious airtime, demand for data has been around for a long time!

When I think DaaS, I’m also thinking of those organisations that are turning raw data into actionable and/or licensable information that can be delivered in a service model. With this definition, all the data licensing companies such as Experian, Equifax, Acxiom, geoTribes, Roy Morgan Research and many others are offering a DaaS

solution. In fact, I would argue that many of the list brokers also fit into this category.

There are new technologies providing scale and reach for data that was unimaginable only a few years ago. This has created the form of DaaS today as opposed to the previous data as a goods (or product) model.

The core variances of DaaS today, compared to how it was in the old days, can be summarised as follows: Data as goods/product: = A single download or append of information via batch processes using date and time stamps to maintain quality and data integrity, = heavily reliant on storage at the user end to capture and store data for in-house access and application, and = loads of complexity shuffling large volumes of data through SFTP (Secure File Transfer Protocol) and data management models.

DaaS: = Offering dynamic access through cloud-based solutions providing the most up-to-date data in real time (or close to real time), = reducing the need to store and administer thirdparty data by integrating with the data provider so information is available on call, and = being hosted by the provider, there is no need to integrate platforms or applications in-house, simplifying use and administration.

So now, DaaS is a more agile and cost-effective solution than it was in the past. Quality is generally better as data is being updated all the time and easy to access. It is now scalable, can support large numbers of concurrent users and is evolving with market movements and new technology enhancements.

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Graham Plant explains Data as a Service, and explores new options for commercialising your organisation’s data.

@marketingmag

Technavio’s market research analyst predicts the global DaaS market to grow at a compound annual growth rate of more than 43% by 2020, with organisations continuing to adopt cloud-based data services for their business.

Building a data-driven business is now a key pillar of many organisations’ strategic plans. This creates an opportunity to improve business practices and customer service, and lift marketing ROI. Key to this goal is the creation of standardised processes and implementation of fit-for-purpose technology that is able to collect and transform data so that it is accessible. The same can be said for DaaS and the commercialisation of data.

Organisations are now looking at their data not only as a source of insight for their existing business, but also as a strategic foundation upon which they can potentially build new businesses. Data is being recognised as an asset and organisations are keen to understand: = the value of the asset, and = whether there are any incremental commercial benefits they can derive.

Companies have been sitting under a deluge of data (both structured and unstructured) and now find themselves administering mountains of data that they aren’t fully exploiting. Many can’t even leverage it for internal decision-making, let alone commercialise it.

With new technology, greater appreciation of data and simplified ways to collect, store, access and analyse data, it will not be long until data currently locked in organisational silos will be democratised to allow wider usage.

A recently published report from Forrester describing the new trends in data commercialisation suggested that a third of organisations referenced were exploring commercialisation of data, or sharing it, for revenue with partners or customers.

The evolution of DaaS technology means that a move to commercialise data is certainly an option for many organisations. Some are doing it well; others not so well.

Many organisations have not implemented the type of centralised data architecture that makes accessing data on demand a reality.

But if commercialisation of your data seems way too far outside your wheelhouse to attempt, then you may look at liberating your data through third-party data providers who are redefining the DaaS marketplace.

Vendors with purpose-built DaaS platforms are increasing in number every year. They are able to act as intermediaries and agents for organisations wishing to commercialise their data without being encumbered

THE SERVE ISSUE

Commercialisation of a is not easy. It’s doable, not easy.

”

with the need to create new infrastructure and a sales and service model.

DaaS is expected to facilitate new and more effective ways for distributing and accessing data. With this capability readily available, industry pundits suggest that, as more companies realise the commercial value of their data assets, the DaaS market will continue to expand.

In recent times, we have seen a rapid growth in the digital landscape with the creation of private data marketplaces, or data co-ops, second-party data or syndicated data arrangements. By connecting the demand and supply side, digital publishers are able to commercialise their audience data uncoupled from their inventory.

Organisations are looking at their data only as a source of insight for their existing business, but as a strategic foundation upon which they can potentially build new businesses.

”

Leveraging unique and rich audience data sets by combining publisher data with other sources of first-party, second-party and third-party data is now commonplace.

Many publishers wishing to secure a new revenue stream are selling off their most valuable first-party data – allowing advertisers and digital trading desks to more accurately target consumers in campaigns.

Through controlled release of their huge bank of transaction and audience data, they are allowing advertisers and their digital trading desks to optimise their own campaigns.

IDC predicts that, by the end of 2017, revenue growth from information-based products will double the rest of the product/service portfolio for one-third of Fortune 500 companies. Further, IDC suggests that ‘data monetisation’ will become a major source of revenues, as the world will create 180 zettabytes of data (or 180 trillion gigabytes) in 2025, up from fewer than 10 zettabytes in 2015.

The market prediction is that raw data and various value-added content will be bought and sold either

via marketplaces, or in bilateral transactions, and organisations will begin to develop methods for valuing and commercialising their data.

By focusing on how data is acquired, distributed, enriched and then shared across heterogeneous platforms – by applying industry standards and leveraging technologies such as data virtualisation – organisations can maximise the return data on one of their most valuable assets.

Now, a warning… Commercialisation of data is not easy. It’s doable, but not easy. That said, the benefits, both financial and strategic, warrant chasing this significant opportunity for those with rich data assets.

So what are the building blocks for creating your own DaaS revenue? Good question. Here’s my high level guide: Gather: Applying an overarching data strategy, implement systems and processes to capture, retrieve and organise data from all relevant sources, regardless of formats and functions. During this process, it is important to consider privacy and governance of data.

Process: With a clear understanding of application, morph the data through an ETL (extract, transform, load) function that creates a normalised and consistent view of the data appropriate to its end use requirement.

Publish: Produce a single interface into the integrated data that resolves the complexity of many formats and sources into a format that the end user can interpret, use and apply. With data captured from the customer, it is important that their privacy and the terms and conditions on how their data will be used, is respected and applied.

Access: Create, or integrate into, a platform (which could be a third-party provider, co-op or partner) that is easily accessible, tightly controlled and simple to use, allowing users to query, access, and use the data and insights.

Even if you don’t choose to commercialise your own data, you will undoubtedly be a user of one or more DaaS solutions. Enriching your own customer data with thirdparty data sources is going to be critical to rounding out a complete view of your customers and delivering new insights not possible from within your business and its relationship with your customers.

Graham Plant is founder of Pearl Business Solutions, providing strategic and board advisory services that turn ideas into successful ventures. This includes start-ups launching a new business, larger companies introducing new products or looking to open new markets, navigating businesses through the martech space or understanding the business value and applications of customer data.

MARKETING OCTOBER | NOVEMBER 2017

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32 DAAS

Barangaroo / LendLease

35 FEATURE

Corporate Australia’s growing appetite Office blocks across Australia are undergoing a resurgence as increasing numbers of property developers turn to premium food precincts as a core part of their offer to tenants, writes Tracey Porter.

@marketingmag

etail expert Gary Horwitz likes to describe successful development as a project where the whole is greater than the sum of very authentic parts. As head of retail development and asset management at Lendlease, the development group behind Sydney’s popular Barangaroo South, Darling Square and Circular Quay Tower retail precincts, Horwitz is more than familiar with what it takes to remain competitive in commercial property enterprise. He argues the best way to achieve growth in today’s environment is in mixed-use development where commercial and/or residential tenancies are married with vibrant ground floor retail spaces and an assortment of quality dining experiences.

Horwitz says it has become increasingly obvious that the more active the ground plane of a development, the better the price point that can be extracted.

“People are coming along to mixed-use developments with the intention of looking at an apartment or looking at an office space and being attracted to the vibrancy and the offer on the ground plane,” he says. “The winner is the one with more of the complete offer. You’re intrinsically adding value to the entire precinct the better you create the ground plane.”

Ben Hughes, national marketing manager for real estate group Dexus – which has an Australian property portfolio valued at more than $22 billion – says local planning changes introduced across Sydney means more laneways are now used for small restaurants and bars and, as a result, many owners have started to reassess how their buildings are managed.

A 2015 research and forecast report by Colliers International, ‘Who will rule our CBDs?’, noted the changing CBD dynamic was being driven by a shift to 24/7 cities with improved planning and infrastructure, transport and amenity.

“More people are living, working and socialising in our central business districts. Over the past decade, our CBDs have grown dramatically as they become increasingly popular with both residents and employers,” the report states.

Hughes says the power of food and beverage brands to transform communities and quiet city spaces is increasingly evident, but insists this type of demand is not exclusive to the country’s largest cities. According to Urbis, food and beverage sales in regional centres are up 90% in the decade 2006-16, says Hughes.

“Delivering destinational brands and a range of food experiences from fast-casual to fine dining in a quality setting is transforming our office portfolio. Attracting not only surrounding CBD workers, but also new users from local residents to the large tourist market in each city is paramount. It’s not just in the big cities: Dexus is also investing into regional locations as well, with locals craving quality food and entertainment experiences.”

Lendlease’s Horwitz says owing to the significant amount of urban regeneration projects currently being undertaken in the New South Wales capital, quality complex large mixed-use developments are no longer feasible unless they include a diverse food and beverage offering that proves engaging for a wide-ranging demographic pull. You can’t just imagine a ground plane

THE SERVE ISSUE

36 FEATURE

A case in point –

It was early 2014 when the development group behind the Grosvenor Place precinct in Sydney recognised things were about to become challenging.

Already facing a significant battle in terms of its commercial leasing division, its anchor tenant had just given notice and the team suspected that – pitched against the backdrop of a series of high-profile redevelopments taking place in other CBD locations including Barangaroo, Martin Place and Circular Quay – the iconic 44-storey building designed by Harry Seidler and constructed in 1988 was neither old enough to be considered Heritage nor modern enough to attract progressive commercial tenants.

Partnering with specialist branding and design agency Frost*collective, the team set about aligning Grosvenor Place with audience-relevant opportunities. Frost’s group creative director, Ant Donovan, says the project was about addressing the challenges and turning them into positives. Owing to the building’s proximity to the Museum of Sydney, the Museum of Contemporary Art and Customs House, an idea was formed to position the precinct’s leasing campaign around the idea of culture at work.

A key plank in the metamorphosis of the site was a $20 million overhaul of the ground plane of the block from the foundations of a beautiful but dated office tower into a truly vibrant civic oasis. “It was about bringing the idea of culture to life and what that could mean as a business or as an employee,” he says.

Grosvenor Place marketing manager Phaedra Dezarnaulds looks at it as creating a neighbourhood within the building, where spaces are designed to bring life to the working environment. “For tenants, it’s more about going to work to enhance your well-being, but also to have some enriching cultural experiences,” she says.

With the specific aim of making their workspace a more welcoming environment and ensuring tenants

felt a part of the Grosvenor Place family, the project team went above and beyond to ensure they offered a range of amenities that helped bring a piece of home comfort to the workplace setting.

They dug deep, investing $9.3 million to introduce six-star end-of-trip facilities and art exhibitions in the lobby, and to ensure the site, which occupies an entire city block, is included in Sydney’s annual sound, music and light festival, Vivid.

But the bulk of the project’s success has come as a result the development of a 1950-square metre piazza and al fresco dining precinct on the site that has not only helped them secure more tenants, but also a created a better sense of community among office workers.

The new culinary precinct, Food Culture by Grosvenor Place, consists of five vastly different contemporary dining options, chief of which is Neil Perry’s Rosetta, a sophisticated Italian restaurant spread over three levels. The precinct’s other retail tenants include the Japanese-inspired Saké Jr, Grand Dūk which offers Vietnamese with a twist, Papa Bo Min which features Chinese cuisine, as well as a coffee shop/casual breakfast, lunch and dinner experience in the form of Georgie Boy’s.

Donovan says the dining precinct acts likes a family kitchen and works as the ultimate connector, while also increasing productivity.

“At a family home the kitchen is where people gather, whether formally or informally, and food fosters communication, it always has done.

Previously, the food offerings in office blocks felt like somewhere you’d go to get a breath of fresh air, grab a sandwich and watch as people smoked like chimneys. It really felt like a grind. It doesn’t feel like you’re going to be productive if you’re in that state of mind. Things like having a range of food offerings, like looking at an exhibition, like sitting by a fountain, they’re things that force you to re-engage and be present.”

MARKETING OCTOBER | NOVEMBER 2017

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Food Culture by Grosvenor Place

of five or six high-end restaurants will survive, he says.

“High-end restaurants are expensive. The market’s moving and the data is telling us that people want a more casual value-add and a variety of offers. If you pull together diverse quality offerings and have a variety of price points, that’s when you’re going to become successful.”

To secure a wide variety of quality providers, ensuring they don’t cannibalise each other and still offer commercial tenants, residents and visitors an all-encompassing experience that will in turn attract higher rents, it’s imperative that commercial developers invest in the ground plane for the long term, he says.

“Once the investment is on the ground, once a CEO of a top 50 company can come to a precinct and witness what it has to offer in terms of the added benefits for commercial workers and in terms of productivity and a real love to work in that precinct, they will stay there for longer. You start to see the longer-term effects when your leases are renewed and they want to stay in that precinct.”

Hughes agrees the rise of quality food and beverage experiences in what were once solely commercial developments is in direct response to the community’s demand for more. “People are looking for an experience when they dine out, offering social interaction in a quality setting with exceptional food. [They are also] seeking unique and evolving dining experiences, from a range of

local independent operators to wellknown destination brands.”

He argues price is important and many new dining precincts are offering everything from value and convenience to affordable casual dining experiences.

Yet Horwitz says that while a fine dining experience may not be a must-have part of the equation, a high-profile chef is paramount to drawing in other high calibre food brands to these types of developments. Developers need to go after both top chefs and upcoming talent in order to give credibility to mixed-use developments because they bring momentum, he says.

A classic example was when Barangaroo was put on the global food map as a result of René Redzepi’s Noma pop-up, which Horwitz describes as “probably the greatest accomplishment that Lendlease’s retail business has achieved in its history of retail”. Off the back of 10 weeks’ worth of sold-out lunches and dinners, the precinct received “tens of millions” of dollars’ worth of marketing collateral around the world”, he says.

“We were able to fortunately secure Matt Moran for this precinct. That was the springboard to various other chefs we have down here. Now Matt is a household name in Australia, but what he brings with his following is for all the upcoming chefs to see that Matt has chosen this as a destination. Based off that, they start to understand that the critical mass of great innovative restaurateurs down here will make the whole precinct successful.”

In addition to enticing Moran, who will open a unique three-level offering in spring 2017 that will include a restaurant and rooftop bar, the Barangaroo development now has nearly 50 different food experiences from a range of top quality chefs, he says.

“I think the way the world is moving… is that we want a break from the digital technology disrupting our lives. We do need special places where people want to go and people will go where other people are. What it really tells us is that if you create a place where people feel like it’s their own, where they feel really comfortable and feel excited by and feel value, they actually feel really warm and glowy about and want to tell other people about it.”

THE SERVE ISSUE

38 SERVICE DESIGN

SERVICE DESIGN FOR BETTER LIFE EXPERIENCES ou’ve recently moved to a new suburb, and you’ve come down with a killer flu. You need a doctor. Badly. Google says there’s a clinic just around the corner. Relief! Well sort of.

It doesn’t have a website, but it does have a phone number. You ring to book an appointment. You’re put on hold for 15 minutes. Your weariness turns to anxiety.

A disinterested voice (is he chewing gum?) books you in.

Five hundred metres from your house, the clinic proves impossible to find. Shivering, delirious, you walk down cold streets and dead arcades. Google Maps unhelpfully says you’ve ‘reached your destination’ – apparently the clinic moonlights as a laundromat. When you eventually burst through the opaque glass door, the receptionist (definitely gum) mumbles that there’s a 45-minute wait while flinging you a ream of forms. The waiting room is three metres squared – quarter the size of the reception desk area. You stand, as none of the six seats are free. The hallmark smell of hospital bleach reminds you of your mortality. This flu could be deadly. For distraction, you pick up a magazine. June 2005, back when Brangelina were still an item. Better to stare at the beige wall and attempt Jedi mind tricks to assure yourself it’s all going to be OK. The next 45 minutes are a tortured eon. Just as despair beckons, you’re called. Despite her windowless cell, the doctor is quick, efficient, reassuring. You’re back in the alley 15 minutes later, $75 lighter and stumbling home.

Many marketers will have heard of ‘service design’.

With no one definition (although many excellent variations), it’s a design thinking approach that’s having a moment – and with good reason. Service design is an approach and process built on a very simple philosophy: the person is central.

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“Service design is a design specialism that helps develop and deliver great services.

Service design projects improve factors like ease of use, satisfaction, loyalty and efficiency right across areas such as environments, communications and products – and not forgetting the people who deliver the service.”

– This is Service Design Thinking by Jakob Schneider and Marc Stickdorn

Instead of designing and building services that suit the organisation or reinforce the status quo, service design starts with the question: what problem are we solving, for who? Instead of using a set selection of tools to solve the problems, service design brings approaches and expertise from marketers, engineers, operations managers, strategists and designers from all practices. Alongside its cousin, experience design, service design is shaking off the drudgery of engaging with services and giving us a glimpse of a sort of human-centred Utopia.

GOOD SERVICE, GOOD COMPETITION For any organisation, the benefit of good service design is clear, and becoming more acute. In Australia alone, the last decade has seen a significant surge in what consumers expect from their services. We are demanding more and, as a result, competition in the service industries is at a high.

From retail, to hospitality, and now medical services, Baby Boomers especially see it as their right to choose – and, as this demographic is armed with greater decision-making

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Marketers are already familiar with much of what constitutes service design, if not the name. Rhod Ellis-Jones shares what you need to know about it.

power that encompasses both significant wealth and their inclination to do their research, service providers must innovate if they are to compete.

On a more practical note, ineffective services lead to inefficiency. Customers drop out in the wrong places, or make decisions that mean they need to double back, or the organisation needs to spend additional time handholding along the way. Higher consumer touch for lower consumer joy: no one gets a good deal.

A LIFE BETTER LIVED

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Service design holds great opportunity for measurably improving people’s lives. In a world of rapid change, technological development and the social transformation that goes with it, every individual and company is required to be an active designer of their future. The role of designers, including service designers is to support this process.

Some services have such social impact as the end goal, like many of those delivered through not-for-profits and government. But the process is almost as important as the result. The process of engaging with a service can empower people, build confidence, open pathways to new thought patterns and create joy. The process itself can deliver a positive impact for people.

Given the right enablers, people can be prompted and supported to become active participants in their own life design: in solving their own problems with their peers. This creates a chain reaction: your design to solve a problem creates new opportunities to solve other problems.

Problems that perhaps we didn’t yet know existed.

THE FIVE GOLDEN RULES OF SERVICE DESIGN There are five central tenets that make up the service design approach. For marketers, many will be recognisable thought patterns dressed in new clothes. But the nuance is important.

Customers are the sun – orbit around them It may seem obvious that the customer (user) should be at the centre when designing a new, or amending an existing, service; however, it’s remarkable how many modern services get this wrong. Any marketer worth their salt will at least

Service design is an roach and process built very simple philosophy: the person is central.

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CASE STUDY: SCOPE Scope champions and supports people with physical, intellectual and multiple disabilities, across Australia.

In response to the NDIS (National Disability Insurance Scheme) and the need to operate in a changing environment, Scope has launched a business transformation project: the Scope 2020 Project.

The project is focused on evolving service models, supporting business transition and stabilising new systems and processes. The end goal: more choices and better services for its clients.

Ellis Jones designed and facilitated innovation workshops, with the Scope working group, to turn qualitative insights into actionable business innovation areas, and with Scope customers, to begin the process of empowering more choice and agency. Focusing on one core service area – supported accommodation – we guided both groups through adapted design thinking processes, to generate ideas and innovation within the roles they could play.

notionally know their customer; often, we have them neatly divided up based on available statistics and demographics.

But what people genuinely need is often not represented in generic data. Often, people don’t actually know what they need until they have the chance to touch and feel it. Often, what is actually needed is not the direct answer to the question you want to ask, it will be something else entirely. Don’t place customers into the boxes you want them in. Let them defy even their own expectations.

Call the gang Co-creation is not new to marketing. In fact, it cannot be separated from marketing. The idea of inviting the customer into the development phase to ensure they have a stake in the outcome both improves the product, ensuring it is something the customer wants and needs, and works to improve loyalty to the brand.

Co-creation in reference to service design builds on this, but goes further to include not just the customer, but all other internal and external stakeholders – operations managers, designers, engineers, customer-facing staff, client liaison managers, clients and investors. Once all these people are in the same room, it’s less about asking the obvious question (how can we design or redesign our service?) and much more about reframing it entirely, to find answers that often change the question.

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40 SERVICE DESIGN

Sequencing is the process of considering every conceivable touch point in a customer’s journey. The journey, and the process of mapping out this journey, is not necessarily linear. Customers enter a service at different points, with different needs, and they require different journeys. Personalisation can create unique pathways and interactions. Some customers require a higher touch than others. Interactions can be with an organisational representative, with a machine or with another customer either online or in person. It can be less like a single path through the woods, and more like the New York City subway system.

Higher consumer touch lower consumer joy: no gets a good deal Leave sweet somethings Evidencing is delivering or leaving somethi ble that can act as a later reminder to a customer of the service – ideally, a positive reminder. It can also go a way to explaining an otherwise ‘behind the scenes’ aspect of the service. Evidencing can be something obvious, like a branded ballpoint pen received when signing banking documents, or it could be a cleverly worded text message advising you that your power will be cut off, and when to expect it back on again.

Service providers typically provide ample evidence of their service… in the form of bills, unwelcome emails and untimely phone calls. Evidencing in a service design context demands that you think differently about how you could convey evidence of your service, in a way that will resonate well with your customer, and ultimately increase the likelihood that they will recall your organisation favourably.

Think outside the service No service exists in a vacuum. There are elements of its surrounding environment that service designers can control, and those that they cannot. Regardless, designers must consider the whole picture. Applying a holistic approach to service design ensures that external organisation, governmental, commercial and societal factors can also play a part in how your service is perceived and received by the customer. It also means the experience of engaging with the service is considered more broadly. How does the physical service space make customers feel? What

technological devices are intuitive for the task? How does one service connect to another within the organisation?

BECOMING A SERVICE DESIGNER Service designers come in many shapes and forms.

They are product designers, graphic designers, strategic managers, operations managers, ethnographers, engineers and architects, to name but a selection. No matter their professional background, service designers are rigorous and independent in their approach. While they don’t all use the same methodologies, they are alike in that they have specific approaches to designing and redesigning a service.

They ask the right questions and, more importantly, know how to reframe the question to uncover important answers.

A BETTER DOCTOR EXPERIENCE Going back to the beginning, how might a service design approach improve the medical clinic? Starting with the customer, it seems clear that the clinic would offer its patients a website, hopefully with online booking functionality. For the patients who do wish to use the phone, co-creation would involve the opinions of the unhappy receptionist, who also advises that his ability to do his job would greatly improve if customers had an alternative way to book.

Further, when sequencing the customer journey, the clinic realises that a text message appointment reminder service would greatly reduce missed appointments, improving the customer experience, and the ability of all internal stakeholders to do their job well.

Evidencing might include a post-appointment email, offering patients the chance to review their experiences online, further assisting future patients. And while it would be ideal to fix the way Medicare rebates are handled, applying a holistic, organisational view proves this isn’t immediately possible. Instead, the clinic provides patients with stamped, addressed envelopes and brief overview of how to claim the fee back – another piece of positive evidencing.

Marketers are well-placed – possibly more than any other discipline – to become experts in service design, due to their focus on deep customer insights and the ways in which they are constantly innovating to connect further with their customer.

Rhod Ellis-Jones is principal consultant for Australian social impact strategy and design agency, Ellis Jones. His focus is behavioural research and co-design for social innovation in health and social services. He is also founder of the Shared Value Project and is currently developing a social enterprise for older Australians to collaboratively design and share services.

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42 CRM

DELIGHT MANAGEMENT

Ferrari Australasia CEO Herbert Appleroth shares the great lengths to which one of the world’s most prestigious brands will go to serve its customers.

RM. Customer relationship management. I can already anticipate your yawn when you read this headline. Perhaps this is more of a ‘me’ thing rather than a ‘you’ thing, but I love CRM. Yes, you read it correctly, I LOVE CRM! Please hear me out…

What is CRM? According to the world’s most revered and trusted sources of information – Wikipedia (cough, cough) – CRM is “an approach to managing a company’s interaction with current and potential customers. It uses data analysis about customers’ history with a company to improve business relationships with customers, specifically focusing on customer retention and ultimately driving sales growth”.

Opinions are like elbows – nearly everyone has two of them. No doubt it is the same when marketers

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describe their definition of CRM. For Ferrari, CRM is less about systems and the creation of stored information of customer names and addresses. For us, CRM is more about surprising and delighting our clients. Like any marketer, I’d like to now create my own acronym to describe how I define CRM: SDM, for ‘surprise and delight management’.

That’s not intended to in any way underplay the great work of all those software engineers, clearly much smarter than me, who create these beautiful silos of code.

Of course, we must have the system with the right data, at the right time, but as a marketer it is what you do with that information that counts.

Question: how much do we know and care about the client or prospective client? The job we have as marketers is

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CUSTOMER

Enzo Ferrari always believed that we uld produce at least one fewer Ferrari n the demand... Ultra-high-net-worth individuals are not used to waiting. to define how can we use these beautiful silos of code to surprise and delight every current and prospective client.

The ‘we’ for Ferrari being every sales, marketing and aftersales staff member in our global dealer network, our regional offices or within our headquarters and factory based in Maranello, Italy. Our task is never an easy one and it shouldn’t be if we are to delight our clients and prospective clients. They already have access to the best of everything. Accordingly, we must go beyond satisfying our clients and be truly focused on surprising and delighting them instead.

FAMILY Our brand, Ferrari, is not about numbers and data; Ferrari is a community, a family. I would argue that we have a closer, more intimate relationship with our clients than most other luxury brands. Ferrari is a passionate brand driven by emotion and ultimately based on a desire rather than a need. Just like any family, Ferrari’s community of clients is made up of many unique and interesting personalities that often wish to interact with us as though they are the only member of the family that counts. In a normal family, it is blood that is the common bond. In the Ferrari family, the common bond is the passion for beautiful, hand-made dream machines. It is this culture that we try to foster,

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creating aspirations, and satisfying dreams. So how do we satisfy the dreams of all our unique family members?

Ultimately, it is by creating a unique one-to-one contact and activities plan for every single Ferrari owner, as though they are the only client that we have. So, while Ferrari ownership is the common bond linking our family members, CRM acts as the system of veins that assists in organising, directing and igniting the passion of our Ferrari family.

ONE-TO-ONE Enzo Ferrari always believed that we should produce at least one fewer Ferrari than the demand, so we have always had a culture of exclusivity. Due to our level of demand always outstripping supply, there is always a healthy and sometimes protracted waiting period when ordering a Ferrari. For the best things in life you often must wait. Accordingly, we have designed a unique set of privileges designed to calm the most impatient of our family members. Ultra-high-net-worth individuals are not used to waiting. These privileges are personalised and unique – made specifically just for that one family member.

Examples could be receiving a hand-made, perfectly scaled model replica of their bespoke Ferrari as they wait to receive the real thing off the production line; or a hand

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signed letter from our president welcoming them to the Ferrari family; exclusive access to our Ferrari Magazine, only available to Ferrari clients; or perhaps an invitation to visit and tour our famous factory in Maranello and a one-to-one session with one of our designers in our ‘Tailor Made’ atelier suite. Money can’t buy experiences that surprise and delight.

DELIGHT BEYOND ENGAGEMENT For many years CRM was simply about having clients’ information stored in one large data silo. Marketers would manage their clients’ data for that one time when they wanted to reach out and sell something.

Should a brand just manage their clients or strive to go beyond?

The buzzword currently is ‘engagement’; however, in most instances this is simply a calculation of the client base that marketers reached out to touch, via either a simple social media post or an invitation to an event.

Brands nowadays must not just manage, not just engage.

Our CRM allows us to build a one-to-one relationship

and delight every one of our clients, each and every time.

Our family members have very high expectations and they are absolutely entitled to expect to be surprised and delighted in every experience with Ferrari. They have access to the finest goods and experiences in the world. To surprise and delight, we provide each family member with a tailored event schedule based on their likes and dislikes. For Ferrari is not just about beautiful fast cars, Ferrari is also about experiences. The individual client’s tailored event schedule is based on qualitative research and involves gaining knowledge on what they truly love in life. If we are going to occupy one hour, one day or even one week of these busy people’s valuable time, then it must be with an experience that surprises and delights them.

Some examples of these Ferrari Esperienze (experiences) include being flown interstate to a secret destination, then being transported by helicopter, driving along some of the most picturesque roads in Australia, enjoying a seven-course degustation meal and

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44 CRM

In a normal family, blood that is the mon bond. In the Ferrari family, the common bond is the passion for beautiful, hand-made dream machines.

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@marketingmag

staying overnight at the luxury Wolgan Valley resort.

Other Ferrari clients were invited to be among the first in the world to see the new Ferrari GTC4Lusso at a black-tie event in Italy, dining in a private castle on Lake Como in the presence of our F1 drivers. For those who appreciate luxury travel and fine dining, we developed the recent Ferrari Esperienza driving the latest Ferrari models through Italy, Austria and Switzerland – giving the opportunity to enjoy not only Ferrari cars on iconic roads like Stelvio Pass, but also Michelin Star dining every night.

For our sports fans, we organised a Ferrari convoy to travel to the stunning country property of a former Australian cricket captain for an exclusive lunch and a game of backyard cricket. Enzo Ferrari always used to say “different Ferrari for different Ferraristi” and this also relates to providing different Ferrari experiences for different Ferraristi. While the experiences may differ, the result must be the same: surprise and delight.

DIGITAL The ways brands communicate with their clients has now changed forever due to the emergence of digital platforms.

Digital, when it is part of CRM, allows all clients to engage directly with the right people at the right time and, most importantly, when the clients want information.

Essentially, communication flows have flipped around from brand-to-client push, to client-to-brand pull.

Ferrari family members can now dip in and dip out of our information stream when they decide. Information travels around the world in nanoseconds and accordingly brands, smart brands particularly, are being forced to respond in the same digitally fast way. One personal example was from June this year when I noticed on our Ferrari Australasia Facebook account a message

arrived at 8.03pm from a Ferrari family member who wished to speak with our aftersales manager.

I responded at 8.36pm, introducing myself, commencing a conversation and advising that I personally wished to assist him. To say that he was more than surprised that I personally responded to Facebook messages after eight o’clock at night would be an understatement. The next day I called this client and resolved his matter. Surprise and delight.

Due to the digital revolution, smart brands are now also revelling with new customer insights like never before and now communicate directly with their final clients, bypassing normal retail hierarchies. If brands can capture these insights as part of their CRM universe, a true one-to-one relationship can be built. At Ferrari, we were among the first adopters in the digital space and now our task is to ensure our digital platforms, including social channels, form part of CRM. Another challenge we all face with so many ‘sources’ where clients can digest information is how to make it easy for our family members to seek true Ferrari information.

Not to be overwhelmed and not be exposed to ‘fake news’.

We are currently developing an intelligent and market leading customer app, which will provide our family members with one location to engage with Ferrari, when they want and how they want. Importantly, this will be all integrated with our CRM system. Of course, no matter how important digital platforms are, nothing replaces the interaction of two human beings, particularly when one is a Ferrari family member.

TEAM For CRM to truly be successful, it must have the buy-in of every single team member, no matter their area of competence. CRM is not something reserved just for marketers. They may be the administrators of the process and system, but every member of any brand’s team must appreciate and be part of the CRM process. Our clients are the most important assets we have. Even when you have a brand that has been twice voted the ‘World’s Most Powerful Brand’ and your products have consistently won international awards over the course of 70 years. To achieve excellence in everything we do, CRM is so very important.

As Enzo Ferrari used to say, “When buying a Ferrari, you pay for an engine and the rest comes for free.” That’s why I love Ferrari and why I love CRM. Or, more precisely, SDM. Forza Ferrari!

Herbert Appleroth is CEO of Ferrari Australasia.

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46 CONTENT PARTNER: MARKETO

Your boss increases your budget 20%. Where do you invest it?

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any years ago, one of my old bosses in a previous company came to me and asked the question: “If I give you 20% more marketing budget this month, where are you going to invest it? And, more importantly, how much revenue should the business expect to get back from it?”

Do you know that sensation when your heart stops for a few seconds, everything around you seems to be moving in slow motion, and no matter how far back in your mind you try to find the correct answer, you know it won’t be precise?

That was me, many years ago, meeting with some members of the management team.

Don’t get me wrong – I went to the meeting very wellprepared. I knew exactly how many visitors our website had month-by-month for the entire year, I even knew the bounce rate of the website and how it was consistently decreasing. All the open rates and click rates of the latest email marketing campaigns were registered in my mind. I knew exactly how many impressions our display

“At that moment I realised a couple of things. First, that as a marketer I couldn’t translate what I was doing into a language my boss would understand: revenue.”

Paulo Martins is online marketing manager at Marketo Asia-Pacific.

campaign had during that period of time. I knew many other interesting stats, too, but as you can guess all those numbers, that I worked very hard to build and prove, couldn’t help me answer the question.

At that moment I realised a couple of things. First, that as a marketer I couldn’t translate what I was doing into a language my boss would understand: revenue.

That was the moment I realised I had to change the way I communicated with my boss for the sake of my career.

The second realisation was that I simply didn’t have the tools and processes in place to make the leap to revenue-based communication. That put me on a path that eventually led me to Marketo a few years later.

Getting a lift in the DeLorean from 2010 to the present, I finally feel like marketers can answer the ‘revenue’ question with precise numbers. Technology such as Marketo’s engagement platform lets us make precise investment decisions, forecast revenue outcomes, and produce reports that provide analytics and data points that CXOs (chief experience officers) have come to expect.

HOW DO COMPANIES CURRENTLY SPEND THEIR MONEY? The ‘Gartner CMO Spend Survey 2016 – 2017’ shows that 57% of marketing leaders expect their digital advertising budget to increase. In 2017, marketing budget represents 12% of the company revenue against 11% on the previous year. 2017 is the third consecutive year of marketing budget growth.

Now it’s my time to ask: how does your experience compare to those statistics? Do you have more budget in 2017 compared to 2016? If yes, do you have a consistent plan to support your budget investment?

We’re investing more in marketing and it’s time for us to be conscious about our decisions. Finding the balance

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The technology available today provides a detailed understanding of marketing performance. It’s a must-have if you want to drive business growth, says Paulo Martins.

touch points on your sales funnel, you won’t be able to understand marketing’s influence on your pipeline, and subsequent revenue generated.

Truly optimising your budget investment while looking at single-click attribution is mission impossible.

With attribution working correctly, it’s time to optimise your campaigns and investments. Your marketing software dashboards will be showing you how the ship is sailing.

Making the decisions to bring the ship to the correct coordinates is your job as the captain. In case you don’t have the tools in place to support this journey, it’s time to reconsider it and stop sailing blind.

“It doesn’t matter how fantastic your campaigns are if you can’t prove their impact.”

CHOOSING YOUR TECHNOLOGY

@marketingmag

between short-term tactics and long-term activities seems to be the ideal scenario. The analogy of bonfire versus fireworks fits well to represent the balance in between the always-on type of strategy compared to loud and quick fireworks campaigns.

When we look at the split of the budget in bigger categories on Gartner’s survey, marketing technology represents 27% of the total marketing spend. Paid media only gets 22% of the total spend. For that reason, making the right choices on technology can impact the business in a much bigger way than you may think.

As a consequence of all those changes, the CMO is taking more responsibilities. In some organisations, the sales, IT and CX functions now report to marketing.

MEASURE CAMPAIGN PERFORMANCE CORRECTLY Attributing the revenue back to your marketing programs is vital. It doesn’t matter how fantastic your campaigns are if you can’t prove their impact on revenue and business growth.

In 2014, only 36% of Australian marketers considered attribution important to success, based on AdRoll’s ‘State of Performance Marketing’ report. In 2017, this number went up to 81%. This research clearly demonstrates how much our local marketing industry is evolving, and paying attention to the correct statistics. The same research showed that over 30% of Australian marketers are investing more than 50% of their yearly budgets on campaign measurement. This is just one more sign of the maturation of our local market.

Make sure you have tools and processes in place allowing you to measure multi-touch attribution. Singleclick attribution models (first-click or last-click) are problematic as they only capture a small portion of the audience and its behaviour. If you do not measure multiple

There’s a piece of marketing technology out there for almost every task you can imagine. Some can do a fantastic job for your business, but be careful with the shiny objects that will distract our eyes from what really matters add little value to your marketing.

It’s time to get back to the first point of this article and ask yourself: = which technologies are going to help you speak the CXO’s language? = How can you translate click rates and website visitors into a revenue language? = Are you able to track multi-touch attribution to marketing programs?

If the technology you’re considering can help you answer some of those questions, you’re heading in the right direction.

Keep in mind that a transformation on this level can reflect on who you are within your organisation, and it’ll support marketing as a respectable department of your company.

The technology that can best impact your day-to-day marketing life is the one that can simultaneously help you make intelligent decisions, report the metrics that matter, help allocate future budgets and prove marketing’s benefit to the business.

We as marketers will never find the perfect formula.

When the topic is marketing, demand-gen and tech, there’s no one-size-fits-all approach. It’s appropriate to stick with the customisable and scalable options that will help you drive business growth.

Marketo is a Marketing magazine Content Partner, a leading organisation with which we collaborate. If you’re interested in more information about this topic download ‘The Definitive Guide to Lead Generation' at mktm.ag/DGLGMarketo

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inside magazine’s 2017 Interior Design Excellence Awards celebrates the very best interior design work from praactices covering everyy genre of design. On 16 6 August, a shortlist of 25 53 different projects was aannounced announced, which includeed 41 entries in the hospitality category.

The winners of o the Interior Design Excellence Awards will be announced at this year’s IDEA Gala on 24 2 November in Melbourn ne. Check out idea-award ds.com.au for announcements.

Here’s a selection of our favourites. Some cutting edge, some classically inspired, all exxamples of what’s possible when great design meets the unique needs of the sservice industry.

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48 PICTORIAL

@marketingmag

ATTICA DESIGN: IF Architecture PHOTO: Tom Blachford CHAT THAI DESIGN: Archstallation PHOTO: Enrico Becker

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PLATINUM CLUB, GREAT SOUTHERN RAIL DESIGN: Woods Bagot PHOTO: Shannon McGrath ST HUGO DESIGN: studio-gram with JBG Architects PHOTO: David Sievers

@marketingmag

THE CUT DESIGN: Melissa Collison Design PHOTO: James Geer 12-MICRON DESIGN: SJB PHOTO: Felix Forest

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THE CRUX & CO CAFE DESIGN: Architects EAT PHOTO: Derek Swalwell JACKALOPE HOTEL DESIGN: Carr PHOTO: Sharryn Cairns

@marketingmag

VIET NEXT DOOR DESIGN: Genesin Studio PHOTO: Jonathan VDK ZUSHI BARANGAROO DESIGN: Koishi Takada Architects PHOTO: Tom Ferguson; Lauren Bamford

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On serve Tennis Australia’s decision to award Australian Open pourage rights to Coopers ended a two-decade association with global giant Heineken. Marketing caught up with Coopers’ national sales and marketing director, Cam Pearce, to find out how year one of five went and what the deal means for the fiercely independent and family-oriented South Aussie brewer. am Pearce has been a director of Coopers for 15 years, and working full-time for about half that. It’s a short time, relatively, in a company that brewed its first batch of ale in 1862. On the board with Pearce are four members of the Cooper family, while other members of the family work in the business, too. With CUB now part of AB-InBev and Lion owned by Kirin, Coopers has fought to maintain its position as the last ‘big’ Australian brewer, resisting multiple takeover bids by Lion.

Its Australian-ness and strong family ethos were specifically called out by Tennis Australia commercial director Richard Heaselgrave last year on the

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announcement that the sporting body had awarded Coopers the exclusive beer pourage rights for the Australian Open for five years starting in 2017.

The agreement means that only Coopers beer will be poured at Melbourne Park throughout the two weeks of the Australian Open, as well as lead-in tournaments in Brisbane, Sydney, Adelaide and Hobart from 2017 and Perth from 2018. It also includes pourage rights for all other sporting and entertainment events at Melbourne Park.

For Coopers, the Tennis Australia sponsorship is now a tentpole feature of its marketing calendar, and one that fits both parties really well. As sales and marketing

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54 INTERVIEW

director for Coopers (and Premium Beverages, its subsidiary company that distributes Coopers as well as several large and small international brands of beer and cider), Pearce says managing a brand like Coopers is about reinforcing its authenticity as as an Australian, family company and capitalising on its position as not-really-craft and not-really-mainstream.

And it’s working. The 2016-17 financial year was the company’s 24th Cam Pearce consecutive year of volume growth.

“In a difficult beer market that’s a great achievement and testament to our excellent staff and people that help us in the market,” Pearce says. @marketingmag

Marketing: Tell us about managing a brand that’s over 150 years old and still in the family – is it a matter of not screwing it up?

Cam Pearce: The family members see themselves as having a custodial and stewardship responsibility. They are mindful that each generation that has success has done so on the shoulders of those that have come before them.

On the one hand, beer’s fun and exciting, and hospitality and the beer game is a great industry to be in, but on the other hand there is an element of seriousness that the legacy that’s been left needs to be carried on.

The reality is it’s a real family company. Tim sits in the corner office and gets out and about. When we launched our Vintage Ale for 2017 in August, he was out there telling the trade and customers about it – it is very real and genuine.

From a consumer point of view, people aren’t always clear about what’s genuine or authentic and real, or not. In a family company like Coopers, it’s all very real and accessible. We’ve got about 22% of the South Australian market and about 6% of the national market, so it’s still a very personable kind of business in terms of accessibility.

People aren’t always clear about what’s genuine or authentic and real, or not.

At one end you’ve got the craft beer thing that has been going on for a long time, and at the other are the multinationals either buying up smaller brands or inventing new ‘craft-like’ ones from scratch. How do you find your balance?

I think, first, the craft beer growth is good for beer overall, because it creates interest among consumers and makes it more exciting. That’s good. There have been lots of different boutique breweries come into play – 10 years ago there may have been 40 or 50 in Australia and now it’s more like 450.

Having said that, you’re right that on the one hand you do have independent craft brewers and on the other hand you’ve got ‘commercial craft’ where the larger breweries have their ‘craft’ brands. Coopers sits comfortably in the craft area, but more in terms of craft-ed.

When we do our consumer research we’re considered in different ways. If you’re a mainstream beer drinker and you want to try something a bit different and move into the craft space, Coopers is a very safe halfway point, so to speak. Our beers are naturally conditioned through secondary fermentation, so the ales are genuine ale products. But equally, too, if you’re a craft drinker and you were getting a bit sick of the triple-hopped IPAs, you may want something a bit more sessionable (referring to the alcohol by volume) and an easier drinking ale like Coopers, and we fit in there well. We sort of straddle the two areas.

How did the Australian Open partnership come about?

After 20 years with Heineken, that was a big change.

We put a very compelling pitch in against other breweries and competitors around ‘Australian owned and made’ and ‘Australian Open’ and ‘Australia Day’, which happens in that two-week period. We created a special product, our Legends Lager, to celebrate that. We developed a campaign that was integrated throughout and multifaceted.

And I think we developed a great relationship with Tennis Australia.

We also benefited from having more than one product, whereas Heineken was a bit more [of a] one-dimensional offering. We’re providing our Original

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Pale Ale and our Premium Lager, as well as Coopers Light and, in some restaurants, a range of our other beers.

We worked very hard to try to deliver a proposition that would grow our brand, but also support the Australian Open. It’s a good fit. Coopers is a premium brand and the Australian Open and the lead-in events are premium events.

Like a lot of major events now, Tennis Australia wants to broaden its event out to appeal to and engage with lots of different consumers – not just people who want to watch tennis, but people who want to bring families, listen to music and do other things like that in an engaging carnival.

For that broader audience, a brand like Coopers fits well because we have a very eclectic drinkership, so to speak, from all over. It’s about the beer, quality and family. All those things work together and we were able to win the bid. The family is involved – Tim, Glen and Mel were over there – and I think Tennis Australia realised the commitment from us was significant and substantial.

It was a good fit, in that regard, for trial and awareness, and our brand awareness in the Melbourne market increased on the back of the sponsorship.

How big an opportunity is the Australian Open for the brand, what do the marketing goals include and how did you activate in the first year?

For us it was a great opportunity to make people more aware of Coopers, especially in the Victorian market, but also in Brisbane, Sydney, Hobart and Perth through the associated lead-in tournaments. With something like a million people coming through the Australian Open and 100,000 in Brisbane and so on, we’re reaching a lot of people.

It’s letting people access the beer and giving them choice. It was a good fit, in that regard, for trial and awareness, and our brand awareness in the Melbourne market increased on the back of the sponsorship, and we got some spikes in the other cities where we were involved as well.

It’s been a great partnership. We did some unique things in year one. The format of Grand Slam Oval was changed in 2017 – it became a less intense area than it used to be. The high-intensity music was moved up to Birrarung Marr. We did a very substantial activation on Grand Slam Oval, which was lower key this year, enabling

people to relax more, whereas up on Birrarung Marr we put container bars for the bands playing there.

We also did a lot of work with the off-trade in terms of running various promotions through banner groups and retailers, and similarly with some on-premise hotels along Southbank and the like, and we were also doing local activations. We were trying to bring Coopers’ involvement in the Australian Open to life at as many touch points as we could. That included radio and outdoor advertising, and a lot of work in the digital area with our social media marketing experts being involved there. We tried to make it a very integrated campaign – above the line, below the line and through the line – to get as much reach and leverage from the sponsorship as we could.

The other great thing about it is, being the only Grand Slam in the southern hemisphere and a really tier-one event, it enabled us to do some great engagement with the trade, with some hospitality stakeholders and developing relationships with our key hoteliers and retailers.

2018 will be year two of five as part of the contract, so we’re excited.

Sponsoring the Australian Open, brands like Jacob’s Creek are very much drawn to the ‘Grand Slam of Asia Pacific’ aspect in that it reaches Asian audiences. Is that a factor at all for Coopers?

Probably not for us, as much. Some of the other sponsors, such as Jacob’s Creek, do a lot of export and are trying to get better penetration in the Asian market, so it makes sense. Our sponsorship is at a more domestic and in-precinct level, so didn’t involve television rights or advertising outside [this market].

Where they may have a more Asian and international export push, we’re focusing on the domestic market at the moment. Our export markets are only about 3% of total production and half of that is New Zealand, so our strategic direction is to continue to grow the brand, especially in the Eastern states of Australia where we’re not as well-known. So for us it’s better to try to engage more consumers and get the brand better known in Queensland, New South Wales, Victoria and Western Australia, than to try to do a big international push for export. We’re still firmly focused on growing our share of the domestic market, because we’re not as well-known outside South Australia as inside where we’ve been for a fair time. Things like the Australian Open and Supercars really have helped raise brand awareness, trial and distribution on the back of it, because if consumers ask for our beer that helps us to get ranged.

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56 INTERVIEW

Know how artiďŹ cial intelligence will affect your business

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58 CONTENT PARTNER: FORRESTER

How AI is already transforming customer service

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rtificial Intelligence (AI) improves the economics and capabilities of everything around us. Consumers are starting to expect intelligent experiences – personal, contextual to their immediate situation, and highly relevant – every time they interact with a company.

Customer service interactions are no exception. In fact, four in 10 contact centre decision-makers are exploring using AI technologies to differentiate their service.

AI can assist agents in completing repetitive tasks, or even completely take these tasks over. Yet, instead of replacing humans entirely, AI will enhance agents’ skills and allow them to focus their attention beyond routine tasks. Agents instead will handle customer interactions that require deeper insight, and analysis. These interactions will often take longer to resolve and are opportunities to nurture profitable customer relationships, which are increasingly rare in a digital-first world.

AI for customer service will: = Deliver CX. Close to half of consumers already use intelligent assistants like Alexa, Siri and Cortana to sustain automated conversations. Intelligent agents for customer service will power single-purpose chatbots such as those used by Dutch airline KLM to communicate booking confirmations to virtual agents that embed deep learning. AI will make these conversations natural and effective, and will delight customers. They will anticipate needs based on discerned context, preferences and prior queries, while also delivering advice, resolutions, alerts and offers.

And they will become better over time. = Make operations smarter. AI will up-level contact centre operations, and streamline inquiry capture and resolution. It will extract useful information from voice and digital conversations and images, as well as machine-to-machine communications, to quickly

Kate Leggett is vice president and principal analyst, Forrester.

surface trends in issues and customer sentiment that may affect customer retention and loyalty. It will schedule maintenance appointments and push fixes to connected devices. It will make field operations more efficient; for example, restocking parts based on needs, or intelligently optimising field resources to provide on-demand service. = Uncover new revenue streams and reinvent business models. AI can uncover patterns in large data sets that may reveal new insights that companies can use to create entirely new services for customers that can be monetised. Machine-learning algorithms used for business and customer intelligence find answers to questions that humans didn’t even know to ask.

Many will agree that AI today, as a technology, is still in its infancy. Yet even at this early stage, AI is having measurable impact on customer service, having started to deliver real results. For example:

AI-INFUSED PRE-SALES CUSTOMER SERVICE BOOSTS CONVERSION AND REVENUE Pre-sales customer service spans activities to support a customer before they make a purchase. Our data at Forrester shows that uncertainty inhibits purchase decisions – especially for online shoppers who buy products that they have never experienced in person. Many customers will abandon an online purchase if they cannot find a quick answer to their most burning questions.

Customer service organisations can intervene in the customer journey via an invitation to chat or co-browse at points of struggle or abandonment, like during checkout, or session inactivity. They also intervene opportunistically at points in the journey best suited for customers to accept a coupon, an offer, or additional advice. They accomplish this via analytics; intent models determine the best outcomes and machine learning refines them over time.

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AI for customer service offers the chance to streamline customer experience (CX) and edge out competitors.

Kate Leggett has some examples of areas where it’s already delivering real results.

Organisations apply AI capabilities for onboarding activities such as customer activation, tracking a customer’s health and predicting customer satisfaction. In fact, they are starting to use real-time satisfaction predictors for incoming incidents to identify in-flight issues and customers who need immediate attention. They use algorithms that calculate satisfaction scores from attributes such as wait times, reply times, incident details and effort metrics, and then decide on what escalation actions to take if they receive poor scores.

“Even at this early stage, AI is having measurable impact on customer service.”

AI-INFUSED POST-SALES CUSTOMER SERVICE BUILDS TRUST

We know that properly onboarded customers are less likely to churn and more likely to purchase additional products, boosting their average lifetime value.

Organisations must invest in customer education, feature discovery and in-product guidance, as these activities take the customer through the first critical steps to success.

Forrester is a Marketing content partner, a leading organisation with which we collaborate to bring exclusive content to readers. Read more from Forrester analysts at marketingmag.com.au

@marketingmag

AI-INFUSED ONBOARDING INCREASES CUSTOMER ENGAGEMENT

Thirty-seven percent of Australian consumers say that customer service greatly influences consumer choices of products and services. Smart companies turn aftersales service into competitive advantage, applying AI capabilities for a range of activities that span search and knowledge discovery, automating conversations via chatbots, automatic case classification that can shave off tens of seconds of call wrap-up time and contact routing. They use robotic process automation (RPA) to automate process steps or even entire end-to-end processes, such as account onboarding or insurance claims, with humans typically only managing exceptions.

In fact, AI has found great success in field service operations. AI-infused field service technologies build models to calculate the time for each technician to complete a job based on skill, personal aptitude and historical performance. They then optimise scheduling and resource utilisation to assign the right field service worker to the right job and ensure that they have the relevant information and appropriate tools when heading into the field.

AI is a journey. You can start small, and use AI to increase efficiency and reduce friction in the customer journey. As you move up the maturity curve, AI-fuelled engagement can enhance customer engagement, allow you to take proactive action and even pre-empt the need for customer service.

Organisations can also recommend personalised crosssell or upsells. They use predictive models and machine learning to target customers based on buying propensity, demographics and psychographics.

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60 PROFILE

Sue Zerk: behind the scenes [Air travel] has always been a fascinating market because you have to both build a brand, so people like you, and be responsible, so people trust you.

ince 2009, Sue Zerk has been the marketing director at 20th Century Fox Theatrical. This role is responsible for building a brand from zero and turning it into dinner party conversation within six months, 20 times a year. Speaking to Zerk, it’s easy to see how her straightforward, anti-BS mentality has seen her through an impressive career. Everything she says is paced, calm and well-thought out – a rare quality in today’s high-pressure marketing environment.

Zerk’s career really began in London, at a time when there weren’t mobile phones and the city wasn’t flooded with Antipodeans. After a couple of years of junior experience working for Ansett, she took the opportunity to move overseas to work for an agency.

“I had a pretty good network who knew some people in London. I guess that was my first big lesson – it’s really important to have a genuine network.” She goes on to explain what she means by this, “I’m not someone who’s a fan of going to those networking – in inverted commas – events because I don’t think they really help you build a network. If you have a genuine network who know what you’re capable of, that’s really important, even when you’re

S

on the other side of the world.”

So what’s her advice for developing a network? “My suggestion is to be curious and genuinely interested in learning with others. Put your hand up to work on a project, or to mentor people, or to simply work together on understanding something that’s new in your category. Nothing builds a relationship like a shared experience.”

It worked in Zerk’s favour that Australians weren’t commonplace in the UK at that time – it meant that she was judged purely on her professional merit. She describes what it was like working in the early 90s in London when everything was still done in hard copy. What does she think is one of the biggest changes since this heyday of marketing? “The pace has definitely changed – I prefer today’s pace, the fast pace we work at and I really like being connected. With the use of technology now you never get a surprise because you already know what’s going on.” As for never switching off ? Zerk doesn’t mind it at all.

After working on an airline brand at her agency, Zerk moved onto British Airways where she spent the next seven years of her career and was general manager of regional marketing based in London and then Australia. Sue sums up her interest in the industry very insightfully: “It’s always

MARKETING OCTOBER | NOVEMBER 2017

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Sue Zerk’s impressive career has spanned some of the biggest corporate names, including British Airways, Fairfax, Tourism Australia and, now, 20th Century Fox.

By Michelle Keomany.

SUE’S TOP FIVE FAVOURITE FILMS (IN NO PARTICULAR ORDER) Muriel’s Wedding / The Godfather Hunt for the Wilderpeople / The Devil Wears Prada / Black Swan THE SERVE ISSUE

62 PROFILE

Movie marketing involves a combination of science and instinct within a highpressure calendar. Each year, Zerk and her team work on 20 to 25 titles, each with a six-month lead time.

MARKETING OCTOBER | NOVEMBER 2017

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Career timeline

and vision to make it happen,” she been a fascinating market because you says. “And when you have these things have to both build a brand, so people it really creates fantastic momentum like you, and be responsible, so people JULY 2009 TO PRESENT because your customers become trust you. But also, you have to be able Marketing director, 20th Century massive fans of you and the customer to tactically activate, you need to sell Fox Theatrical, Australia focus shines through. Your employees seats every day – as soon as that door also share in that vision and that shuts those seats are gone and that SEPTEMBER 2005 TO JUNE 2009 shines through in the soft product value is lost, so you need to be able to Marketing director, and the service, too. It was a really activate things very quickly and you 20th Century Fox, Home incredible time to be part of something need to be commercially focused.”

Entertainment, Australia so big.”

All the work Zerk refers to started Now, as marketing director at 20th with very sound insights and rigorous APRIL 2003 TO AUGUST 2005 Century Fox Theatrical, Zerk reflects research. During her time at British Group director of marketing, on the similarities with the airline Airways, she saw the introduction of Fairfax, Australia industry and how they both need to flatbeds and frequent flyer programs continually sell seats and provide an and it was the early days of CRM. “I MAY 2002 TO APRIL 2003 experience to customers. “I can stay worked very closely with the team General manager, regional home and have great food delivered that came up with flat beds in busimarketing, British Airways, and drink great wine, but I still go out ness class, which came from an insight Asia Pacific to restaurants – this is a very similar through research (which sounds analogy for going to the cinema. The very obvious now). People said they APRIL 1996 TO APRIL 2002 experience has to be worth it. It has to don’t really want caviar, trolleys and General manager, marketing, be value for money,” Zerk explains. polished silverware – what [they] British Airways, London Australia is actually one of the really want is to be able to sleep...” biggest and most developed movieZerk speaks about working for APRIL 1993 TO APRIL 1996 going markets in the world, with a very an organisation that involves hard Regional marketing director, high frequency of cinema attendance. product and the responsibility Tourism Australia, Europe And business has been growing for the involved. For example, putting TV (based in London) last five years. Zerk says the two main screens onto the back of aeroplane drivers are the product itself, the films, seats costs hundreds of millions of and the high quality of the exhibition dollars and factors such as the weight companies, and the cinemas, such as Hoyts, Event, Village of the aircraft have to be taken into consideration. and great independents.

“A lot of that also comes back to leadership, culture and Overall, movie marketing involves a combination of vision, which I consider to be really important.” At that science and instinct within a high-pressure calendar. Each time, Zerk says, British Airways management really wanted year, Zerk and her team work on 20 to 25 titles, each with a to revolutionise air travel and be the most innovative and six-month lead time. She says it’s very challenging. There’s forward-thinking airline in the world. “You need to have a lot of juggling, she rarely knows what month it actually is both the intellectual rigour and financial modelling, but and quite often won’t see the movie until close to the release you also need to have the emotional intelligence and intent date – after the media briefs have been written.

Has she ever been surprised when she actually gets to see the whole film? “Oh yes… sometimes you’re given materials that look like one thing, but then when you see the film it turns out to be something else.” She explains how important word of mouth is and how it was an unexpected key factor in the success of two recent films, Deadpool and Hunt for the Wilderpeople.

For the award-winning film Hidden Figures, released in Australia in early 2017, Zerk says that, along with a nuanced target audience, their approach also involved basic personal judgement.

Sue’s top five tips for navigating marketing BS

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“We suspected that this film would have great word of mouth, because we used our own judgement. We invested a significant amount of money in the marketing campaign – it was a multifaceted campaign to get older women and families.” Zerk goes on to say that managing the tone of the 1. Ask why? And repeat. film was also very important and they invested a significant 2. Ask how this would be explained to your mum. amount in a screening program, so people could spread word of mouth before it was released. Hidden Figures earned 3. Ask to see results. Commercial results, not $15 million in Australia, making it the film's most successful movements on a chart. non-US market in the world.

While it has its challenges, one of the great things about 4. Ask why again. the industry, Zerk says, is that if your film is working, you’ll 5. Follow up in six months – so much stuff that get the numbers on the first day. Which can be a blessing and predicts the future sounds good at the time and is a curse. You can see where it’s working and what time people went, allowing you to be predictive and reactive at the same never revisited. time. On the flipside, however, this also means being able to see when something isn’t delivering, but not being able to reverse it. By the time a film is released over 80% of the media budget has already been spent. “One of the things What does she suggest to overcome these issues? “I think that’s really great for us is that the digital media canvas you have to demand visibility. The other reason I really like allows us to see who is responding to what we’re putting out, doing what I do is that when we phase out our activity and to make some changes to the creative, change our targeting our media, we’re always independently tracking it. I think and to really get under the skin of the consumer,” Zerk says. that’s absolutely essential.” She strongly recommends doing “I’m very fortunate because it’s one of the very few jobs as a your own work and setting your own success criteria. marketing person where you can have the real responsibility Zerk also believes that one of the issues in marketing for the profit and loss.” today is not being able to truly understand who your Zerk speaks with clear purpose and a focus toward audience is. “I find even in media discussions most people everything she does and is driven by the need to constantly think about the media they consume as opposed to the media perform. She’s also acutely aware how important it is to have the the audience is consuming,” she says. right people: “I’m a big fan of recruiting Zerk adds that one of the things people who genuinely want to accept she encourages her team to do is to the challenge – that’s the biggest thing, get out of their bubble by getting on a SUE’S FAVOURITE to find the right people and give them train to somewhere they haven’t been CANDY challenges. In the work we do, you before and simply having a look at can see the results of your labour very what people are doing.

BAR SNACK? clearly and my team find that to be It’s clear that Zerk’s approach Wine (is that wrong?) incredibly rewarding. They also love the comes from an innate intelligence and category; they love working on films.” drive to do what she does. She says that With such an impressive career it’s about finding an element of your working at a senior level across a number of industries, role that you can be really passionate about. “Everyone’s Zerk is aware of the need to constantly evolve and navigate different, but I really prefer to have a passion for what I do. a changing marketing landscape. She cites visibility and I’ve always chosen to work for brands that represent what agency transparency in the digital space as the biggest I’m interested in and that I genuinely want to contribute to.” challenge that CMOs are currently facing. “You’ve got an The challenge for movies, she says, will continue to infinite canvas of media that you could be placing when be telling great stories that people are excited to see – and you’re talking about the broader digital environment,” Zerk fostering urgency for audiences to go out and enjoy them as says. “Sometimes you have to call bulls**t – when I hear soon as possible. It’s continually rising to the challenge of about engagement, what does that really mean? selling seats before the door closes that keeps her on her toes “Things are so difficult now for marketers and there and evolving to meet everything she has faced throughout are so many decisions to make and people are taking their her career. Zerk sums up her role perfectly: “It’s great to be a insights straight from the mouths of someone who’s trying commercial person in a creative industry,” and the industry to sell them something, which really concerns me.” is very fortunate to have her.

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64 CONTENT PARTNER: APPA

APPA Awards for Promotional Excellence winners 2017 Celebrating the very best in promotional product and merchandise marketing.

Platinum Award for Overall Excellence and Merchandise Programs and Events Merchandise WINNER: ARID ZONE CLIENT: XERO AUSTRALIA In order to complement its brand promise to make accounting software cool, Xero required a bespoke merchandise range for internal staff and customer events.

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The Australian Promotional Products Association (APPA) is the only professional trade association speciďŹ cally for the promotional products and promotional marketing industry in the Australasian region. The APPA Awards for Promotional Excellence recognise the outstanding use of promotional products in business and marketing programs.

B2B Programs WINNER: FLOURISH MARKETING CLIENT: INSIGHT Healthcare ad agency Insight asked Flourish to develop a mail campaign for doctors. Flourish developed a program that included clinical posters, a brain model and a video brochure to discuss key elements of pain.

Consumer Programs Gift With Purchase WINNER: INCK MERCHANDISE CLIENT: SCENTRE GROUP PRODUCT: WESTFIELD CREATE YOUR OWN CHRISTMAS BAUBLE Scentre required a Santa giveaway with a high perceived value different from the usual branded Christmas paraphernalia. They had to be gender neutral, suitable for children aged three and older and have an interactive and playful element.

MARKETING OCTOBER | NOVEMBER 2017

Limited Budget (Under $5) WINNER: INCK MERCHANDISE CLIENT: NESTLÉ AUSTRALIA PRODUCT: ‘CHOOSE WELLNESS’ PORTION PLATE The design illustrates healthy food choices and provides examples to help consumers understand portion control and a balanced diet. Eight different designs have been produced for markets around APAC.

Distributor Self Promotion WINNER: SISTER KATE MARKETING PRODUCT: SISTER KATE FEELERS The campaign contacted past customers with the goal of getting them to work with Sister Kate again. Finger tentacles were chosen as a fun, memorable product, accompanied by the tagline ‘just putting the feelers out’.

Promotional Product Innovation and Design @marketingmag

WINNER: ARID ZONE CLIENT: GREYHOUND RACING VICTORIA PRODUCT: TURBO – GREYHOUND RACING VICTORIA Arid Zone was asked to create a mascot for the Greyhound Adoption Program, one that was fun for children. ‘Turbo’ was born, and paired with a number of items designed to engage with children and families at race events.

Sustainable/ Eco Friendly/ Recycling Programs

Not for Profit Promotion

WINNER: SISTER KATE MARKETING CLIENT: M&C SAATCHI PRODUCT: NESPRESSO NOTEBOOKS

WINNER: BRANDINC CLIENT: SYDNEY GAY AND LESBIAN MARDI GRAS PRODUCT: MERCHANDISE RANGE

Nespresso wanted a compact, environmentally-friendly aluminium notebook to give to Club Members, one that educated its customers about recycling aluminium coffee pods.

Brandinc approached Sydney Gay and Lesbian Mardi Gras with the idea to develop a branded merchandise range that could be used to generate revenue, promote the brand and provide quality memorabilia.

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66 COMMUNITY MANAGEMENT

COMMUNITY MANAGEMENT: THE SOUL IN OUR NEW MACHINES ommunity management is at a crossroads.

Once tethered to the digital frontlines, community is now heralded as the future of business and leadership.

Community managers are building the human infrastructure of the 21st century. AI and automation can support them.

The machine layer offers community strategists power – think Tony Stark’s suit in Iron Man. Used as a tool, it can liberate our time for work that demands a human touch – essential to build that human infrastructure of interconnected ecosystems.

But the Iron Man scenario only works if community professionals help drive the creation of AI – behaviourists alongside technologists to shape nuanced, contextually astute intelligences that consider where the human begins and the machine ends.

C

MODERATION Real strides have been made here, even though most tools are geared for comment streams, not many-to-many discussions. In 2012, HuffPost gave its human moderators a textual analysis AI called Julia to help them manage 10 million comments per month. Argentinian social network Taringa! uses a hybrid model of linguistic, image and human eyeballing to manage 1.5 million monthly posts.

The Washington Post launched ModBot – its AI loaded with the lessons of WaPo moderators across a decade –

for comment moderation. With filters and flags, ModBot processes what it can, escalating content up the chain if it needs human intervention. Instagram and Google are experimenting with AI-supported moderation for toxic content. Community managers have tried Google’s AI, Perspective, via its open source API and found it struggles with sarcasm, subtlety and cultural translations.

UK start-up Spirit AI is giving us a glimpse of the future with its embodied software called Ally. The tech supports community managers of virtual worlds, monitoring interactions to detect harassment such as stalking. Ally drops a private note to the possible victim to see if they’re OK. The user can ask for help, or tell Ally not to worry, and the system learns. It’s impressive, but there’s no singular response to harassment or threatening behaviour.

WE CAN AND WILL BREAK OUR MACHINES Humans cannot resist the urge to manipulate systems, and AI is a system. Users are already entering into adversarial relationships with algorithms as they game them to suit their needs. Serial pests are adept at this arms race, and AI is merely a new dimension to their sport.

Machines are ideal for handling ‘low-fi’ moderation tasks like vacuuming up spam and swatting trolls. But moderation is also ‘hi-fi’ – balancing of voices and social dynamics, highlighting ideal behaviour, diffusing tensions between members, or discreetly putting someone in touch with crisis services.

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Automation and AI (artificial intelligence) have many in digital industries running scared. Should the custodians of peer-to-peer relationships around brands be concerned about the future?

SMART SOCIAL STRUCTURES

WE CAN’T LOSE THE COMMON GROUND

Early online communities were bounded digital destinations. Social networks connected them. Now, communities are highly distributed across multiple environments. Most have some version of an ecosystem anchored in one or two key places. Community managers oversee and steer the ecosystems, and build out and massage them as participant needs change.

AI can help us create new smart zones for engagement using conversational analysis. If a hot button issue is emerging, we can program our AI to create a sub-forum to house discussion around that topic. Community architecture can become more fluid with the support of machine learning and a community manager to feed its smarts.

The value of hyper-personalisation is clear: reduce signal-tonoise ratio and connect consumers with content that activates and fulfils needs efficiently. Personalising a community experience misses the point. Community is valuable because it’s a shared experience. Even conflict – like debate – can engage and bind members. Community is a highly effective silo-killer. Individualise an experience excessively and those silos shoot back up.

Peer support communities in particular rely on immersion in a collective. Mental health organisations Sane, Cancer Council NSW, Beyond Blue and Reach Out each run outstanding forum communities where a common connection fuels constructive engagement. Although you may be able to personalise certain content within the community for a member, AI can’t replace the critical inclusivity and empathy of talking with someone going through a similar situation.

BOTS: CONNECTING THE DOTS Bots can connect us to useful information when we first join a community. Many people prefer a tip from a bot to self-service. Xero’s bot for Messenger, Hey Xero, does a great job with asset discovery and troubleshooting, answering questions and connecting wider members of Xero’s B2B customer community to local experts.

This can be extended into broader community management contexts. An intelligent agent could help a manager of a large community by welcoming newcomers and recommending certain conversations or content.

They can stimulate activity by sending a private message or making a public post suggesting that member A connect to member B. And they can help the community manager identify influencers, experts or members that fit certain criteria.

MAKING MORE TIME AND SPACE FOR TRUST

BUILDING OUR HIVE AI will change the way community professionals manage their knowledge base. Machine learning can wrangle the repository of resources we’ve assembled over decades, and connect us with the right resource for the job at hand. We tell the machine our problem and it cobbles together a batch of case studies, research, tools and individuals we can tap to solve it.

Founder of virtual assistant x.ai, Dennis Mortensen, talks about a Bring Your Own Agent (BYOA) future-state in less than a decade, where workers will create or order intelligent agents to accomplish highly specific (vertical) tasks that help them in their jobs. The community manager of 2027 could carry with them a team of agents designed to complete single tasks in their community management portfolio.

SOCIAL MARKETERS ARE VULNERABLE

Trust is currency for the community manager; our communities don’t work without it. We earn it, nurture and maintain it through human-centred interactions and social proof. Introducing machines at the wrong moments, or in the wrong way, erodes trust.

Customer service agents in too many businesses are pressured to behave like machines as it is – incentivised on speed and cost reductions, not satisfied customers or care invested. We’ve dehumanised this work to such an extent that a bot that can spend as long as we need solving our problems actually seems refreshing.

Let’s use the freedom this offers responsibly, and reinvest our humanity where it counts: solving the sophisticated and strategic problems for our customers and enabling our communities.

Social media managers who distribute content systematically and drive engagement against it will be superseded by automated equivalents. Community management’s point of distinction is its humanity. Instead of being replaced, community experts will upgrade. We’ll work to help businesses set up bots and intelligent interactions. We’ll plot behavioural frameworks for machine learning. We’ll spill into HR, marketing, IT, innovation – anywhere there’s a need to understand and optimise social intelligence. Leveraging AI for communities demands we extend our capabilities as social systems engineers. If we get it right, we can see to it that AI augments our best natures.

Venessa Paech is co-founder of the SwarmConf community management conference.

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70 CASE STUDY

Fuelling re-evaluations Background: To stimulate economic growth and reduce greenhouse gas emissions, the Queensland Government’s Biofuels Mandate requires E10 petrol sales to double. The problem is that E10 petrol is not a popular choice among motorists.

Ogilvy and the Department of Energy and Water Supply (DEWS) embarked on a digital-centric campaign that is successfully engaging an ambivalent audience in a low-involvement category.

While E10, an ethanolblended fuel, had been available in Queensland for over a decade, a compounding decline in sales forced the Queensland Government to respond with a new legislation to curb this downturn and ensure E10 made up at least 30% of petrol available for sale in the state, from January 2017.

To coincide with this legislative change, DEWS engaged Ogilvy Australia to develop a campaign to present the positive side to E10 and ultimately encourage consumer adoption.

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500,000 completed checks using the E10 compatibility checker digital experience), and develop a clear understanding of the unique attributes and benefits of E10 with reliable and accessible information.

Target audience: Using a segmentation study of the Queensland petrol buying population, the primary target audience was identified as the 1.7 million Queensland motorists who are ‘everyday’ consumers of regular unleaded petrol. A secondary audience came from the 200,000 motorists who had upgraded from unleaded to a ‘premium’ fuel based on the perceived benefits.

Qualitative and quantitative research found that the habitual nature of purchasing fuel had lowered awareness, understanding and consideration of E10.

More worryingly, pockets of the motoring population believed E10 to be damaging, inefficient and incongruous with their car.

Ultimately, the campaign would need to challenge all of these misconceptions.

Objectives: There were two

unleaded), we needed to prime motorists by offsetting the frankly inadequate understanding of E10 with a digital experience that would challenge their outdated misconceptions.

Based on the stages of behaviour change from pre-contemplation to actual behaviour change, the campaign would need to work in two key phases.

Phase one: reframing E10: The first part of the strategy was developed on the product insight that fuel formulas had evolved and car manufacturers now design engines to be compatible with blended fuels like E10.

The creative idea, therefore, was to simply address these developments and provoke consumer reappraisal with the campaign title ‘A lot can change in ten years’ with a specific emphasis on how E10 was in fact now ‘OK’.

We also knew the ad campaign alone would not be able to shift the attitude or behaviour change required. In addition, it would need to draw our target audience into an active, personalised and two-way experience in the digital space.

overarching campaign objectives:

- Motivate Queensland drivers to consider and select E10 as their preferred fuel choice (including, from a digital perspective

Strategy: Inspired by the fact that regular unleaded users could be convinced to switch fuel (as evidenced by the rise of premium

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Phase two: nudging to consider: The campaign also challenged Queenslanders to

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Campaign Biofuels Education Campaign – E10K Client Department of Energy and Water Supply Agency Ogilvy Australia, Brisbane

Qualitative and quantitative research found that the habitual nature of purchasing fuel had lowered awareness, understanding and consideration of E10.

reassess E10 by asking them to consider their own car in the context of fuel and engine evolution through a mobile-first digital experience, where a sophisticated car registration checker would allow a user to establish a car’s compatibility with the fuel.

Execution: Driving users online

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was a comprehensive through-theline campaign featuring V8 Supercar champion Mark Winterbottom, in which he implores Queensland motorists to think about how fuel formulas as well as car engines have both advanced.

Featured in every facet of the campaign was the insistence that Queensland motorists should grab their phones and search the campaign catchcry ‘E10 OK’.

The idea was to have motorists land on a user-friendly site to establish if their car was E10 compatible. This exercise would demonstrate that most cars are now E10 compatible and encourage motorists to reconsider it as a fuel alternative. Early research had highlighted that customers were open to an online compatibility check to confirm their vehicle was E10 OK. Using a car’s registration details was ideal to make it simple for the customer.

Knowing the digital experience would be the final conversion point, much thought, design and tech smarts had to go in to creating a highly intuitive web experience.

Placing the mainly apathetic user at the centre of the experience, the campaign website hid the complex logic to calculate compatibility behind a very simple user interface.

The mobile first site allowed a user to simply enter their car registration to instantly reveal their car make and model, its E10 compatibility (straight from the manufacturer’s manual)

and, importantly, the petrol stations close by selling E10.

To do this, three datasets were brought together via APIs (application programming interface) and data files, to first get vehicle details, then check the compatibility of the vehicle and finally point towards the nearest petrol station selling E10.

Matching the vehicle details across three datasets, often with data integrity issues, was a significant challenge. Despite a very tight timeline, extensive testing was completed with thousands of registrations to decrease the chance of users receiving a false negative response. In addition, results were monitored closely after launch and the checker logic adjusted as needed.

To avoid bounce rate and increase conversions among the audience, the website build was relentlessly optimised, particularly in speed and performance. Any lag would lose the user and, with many users anticipated to be on mobile devices, the solution needed to be entirely responsive. With advertising targeted at mobile users, the website uses a device’s location services to target E10 location content to users.

The digital experience was further embellished with useful videos, fast facts about E10 and an assortment of other carefully curated, purposefully limited resources.

Results: The two-pronged approach to the campaign has been successful in reframing E10 and using a simple digital experience to nudge motorists towards considering the fuel by having them re-evaluate it in the context of their own car.

The campaign has achieved exactly what it set out to achieve – Queenslanders reaching en masse for their smartphones and taking a THE SERVE ISSUE

The digital experience was further embellished with useful videos, fast facts about E10 and an assortment of other carefully curated, purposefully limited resources. quick look to see if their car is ‘E10 OK’. This has reframed the fuel and placed it back on the radar of motorists with a smart yet simplistic digital experience.

A mere six months into the 12-month campaign, the campaign tracking report indicated that half of the Queensland population had seen the E10 campaign, delivering remarkable awareness with unprompted awareness sitting at 52%, and prompted at 94%.

The digital face of the campaign has also enjoyed huge success with more than 1.3 million YouTube video views, over 1.2 million unique visitors to the E10 website and a staggering 570,000 car registration checks already logged, versus a target of 500,000 with two months still to go. The efforts to make the UI (user interface) clean and easy to use have been incredibly successful, with an 85% conversion rate (website visitors who complete a compatibility check).

Most important of all, the campaign has already met its overarching objectives.

It has increased consideration to use E10 by 20%, increased understanding and decreased the perception that E10 is bad for vehicles.

The campaign also recently won an AMY Award, for Digitally Led Marketing Campaigns (Government and NFP [not for profit] sub category).

74 CASE STUDY

Campaign Need a Break Client Choice Hotels Asia-Pac Agency Gravia Media and Akkomplice Group Australia Background: With more than 250 properties across Australia, New Zealand and Singapore, Choice Hotels Asia-Pac provides a wide range of accommodation offerings in diverse destinations.

According to Roy Morgan Research, Australians have 134 million days of annual leave accrued between them, amounting to 16 days each. In fact, more than a third (34%) of the nation’s 8.5 million paid workers have four or more weeks’ worth of annual leave accrued.

Both Australia and New Zealand have some of the highest rates of unused annual leave compared to other developed nations and, accordingly, our paid workers suffer stress due to various key factors such as work and family responsibilities.

Recognising this as a strong marketing opportunity, Choice Hotels Asia-Pac began internally brainstorming how best to use these reports and ultimately encourage Aussies and Kiwis to use their annual leave for domestic getaways. In 2017, Choice Hotels Asia-Pac and

agency partners, including Gravia Media and Akkomplice Group Australia, began laying down the foundation for their new integrated marketing campaign, ‘Need a Break’, as a catalyst for a short break mentality. The campaign launched on 5 June.

Objectives: Inspire Australians and New Zealanders to take regular short breaks of one to three nights, - develop a strong, multi-channel, year-long campaign to encourage the population to take short breaks in order to safeguard their mental well-being and better manage stress levels from day to day life, and - position Choice Hotels Asia-Pac as a leader in the ‘short break’ leisure market within the Australian and New Zealand hotel industry and be top-ofmind for consumers looking to take these types of getaways.

Strategy: With the release of the Roy Morgan report, the decision to create a campaign around using annual leave was apparent. After several internal discussions with various stakeholders, Choice Hotels Asia-Pac decided on a short break focus, in which an emphasis would be placed on getting people to go on short getaways ranging from one to three nights away from home.

Why short breaks as a focus?

Short break getaways are more affordable and therefore more achievable for households of all

MARKETING OCTOBER | NOVEMBER 2017

incomes and demographic profiles.

Choice Hotels Asia-Pac wanted to provide solutions to alleviate stress for everyone. Short breaks are also far easier to plan and this was an important consideration when offering solutions to the time-poor, stressed out population.

With research (Choice Hotels’ ‘Need a Break’ report) showing that a short break is the most desired way for people to relieve stress and with Choice Hotels having such a wide range of accommodation offerings all over the country, focusing on short breaks was a no-brainer.

The first step in getting the campaign off the ground was to ensure messaging would resonate with consumers. For example, it wouldn’t make sense to promote that Australians and New Zealanders are in need of a break from stress if they’re not actually stressed.

Choice Hotels Asia-Pac commissioned independent researcher First Point Consulting to conduct an online survey of approximately 1000 Australians and 1000 New Zealanders in March 2017. The aim was to garner insights into the motivations, interests and barriers of those taking short breaks, identifying behavioural and attitudinal trends. The research surveyed males and females aged 18 and older, from households earning a minimum of $50,000, across every state and representing a diverse range of professions.

The main target audiences were split into three age groups – Millennials, Generation X and Baby Boomers. Through the ‘Need a Break’ report, Choice was then able

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Choose a break

77 CASE STUDY

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to further understand the different stress factors and solutions of each generation given age gaps and behaviours.

The results were astonishing.

Over two-thirds (67%) of Australians were experiencing moderate to extreme levels of stress.

This led to almost a quarter of Australians (24%) not taking a single break in 2016.

Even outside of the workplace, Australians do not seem to be taking breaks, with 40% of families with children agreeing they could not go away on short breaks due to activities and other commitments.

The ‘Need a Break’ report identified that across the board, regular short break holidays were the number one preferred solution to relieving stress, ranked above exercise, alcohol, shopping, sleep, a bath, food and even sex.

The report showed that 75% of Australians felt they had a greater work-life balance back in their lives, with most of them feeling happier and experiencing a closer connection with their partners and children.

- Website – needabreak.com

-

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Execution: Following the survey results, Choice Hotels Asia-Pac went all-in to develop elements for its integrated, multilayered campaign.

In Australia, the campaign included key initiatives such as the launch of a new website (needabreak.com), the branding and wrapping of a Jetstar plane, a new TVC, sponsorship on Channel Nine’s Today breakfast show, large-format location-specific outdoor advertising, targeted radio advertising within the Hamish and Andy Drive Show, digital, social media and PR. The overall campaign elements included the following initiatives to create awareness and heighten the importance of taking short breaks:

-

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provides Australians and New Zealanders with inspiration, tips and advice for taking short breaks. The content hub includes destination reviews and a unique itinerary planner. It also incorporated a quick and easy booking facility to all Choice properties.

Television commercial – Choice secured a daily TVC sponsorship with Australia’s top rated morning breakfast show, Today. The clever creative shows an office descending into chaos after a seemingly innocent and relatively innocuous source of irritation sets off a chain reaction of events, ultimately ending with a photocopier in flames being thrown out of a building.

Additionally, Choice secured an on-air segment highlighting the benefits of short breaks.

Plane wrap – this same creative theme is replicated onto a branded Jetstar plane, which flew across Australia and New Zealand, carrying travellers to a wide range of destinations. The image used for the plane wrap emitted the same emotional theme that was portrayed in the ‘Need a Break’ TVC. Outdoor advertising – outdoor advertising also used the creative theme of an office descending into chaos. Billboards highlighting the campaign were placed around targeted locations.

Through location-specific advertising, Choice targeted those who may be stuck in traffic.

Radio – Choice secured a partnership with Austereo to sponsor the drive time traffic and news segments during the Hamish and Andy Drive Show in Australia. This hit peak hour drivers – often the time when they desire a getaway the most.

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Programmatic display advertising drove consumers to the needabreak.com platform and then through understanding their destination interests and desires, retargeted them with booking offers.

- Digital and social – while the above the line elements of the campaign were targeted towards driving awareness, digital and social elements were aimed at converting hotel reservations.

Choice invested heavily in setting up an attribution model and sophisticated tracking to ensure it could measure the impact needabreak.com was having on converted sales through choicehotels.com.au and choicehotels.co.nz.

Programmatic display advertising drove consumers to the needabreak.com platform and then through understanding their destination interests and desires, retargeted them with booking offers.

Key social media channels, predominantly Facebook and Instagram, were then used to feed out and promote the content within the needabreak.com platform.

Results: To date, the needabreak.com website has had over 75,000 visits since its launch in June and, by tracking the user journey, Choice Hotels has been able to largely attribute this campaign to current YOY reservation growth of over 20% through the Choice websites.

78 CASE STUDY

Seven dinners in seven nights

Background: Broadsheet’s

Objectives:

branded content studio developed a campaign that offers Broadsheet’s dining-obsessed audience seven dinners in seven nights at premium restaurants that are often booked out months in advance. The winner and their three dining companions were chauffeur-driven in a Honda HR-V to and from the restaurants each night.

As the essential city guide in Australia, Broadsheet leveraged its strong relationships with its network of restaurants and bars to create a money-can’t-buy experience for readers. This year the competition was bigger and more successful than its first iteration in 2014, expanding the competition from Melbourne and Sydney to also include Brisbane and Perth, with the help of Honda HR-V. Broadsheet proudly partnered with Honda on this exciting campaign and communicated the Honda HR-V as the perfect vehicle to go on food adventures in your city.

Honda:

- drive an uplift in salience for -

-

the HR-V throughout the target demographic, build awareness of the HR-V with those out of market, build consideration of the HR-V with those in market, position the Honda HR-V as a means to exploring and uncovering the unknown parts of your city – the accomplice to your foodie adventures, and speak to an engaged and inspired audience through Broadsheet’s network.

Broadsheet:

- reward readers with a moneycan’t-buy experience,

- deliver strong competition -

results and achieve the Honda HR-V campaign KPIs, continue to grow Broadsheet as the essential guide to city culture in new markets Brisbane and Perth,

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- continue to offer readers in

-

Melbourne and Sydney unique experiences and the chance to dine at leading establishments, achieve more than 40,000 entries across the competition, and drive newsletter subscriptions in Melbourne, Sydney, Brisbane and Perth.

Strategy: Broadsheet covers the best of city culture across food and drink, fashion, art and design, entertainment, travel, and active lifestyles in Melbourne, Sydney, Adelaide, Perth and Brisbane. The highest level of traffic to Broadsheet comes through food-and-drink related content. To capitalise on the audience’s thirst for dining content, Broadsheet aligned the HR-V with ‘Seven Dinners in Seven Nights’ to provide Honda with an opportunity to help the audience uncover the best of the city’s dining experiences.

Through content to promote the competition, it positioned the Honda

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Project: ‘Seven Dinners in Seven Nights’ Brands: Broadsheet and Honda

Cutler & Co / Photo: Jake Roden

Spirit House / Photo: Kirsty Sycz

Osteria / Photo: Gareth Sobey

81 CASE STUDY

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HR-V as the perfect partner to explore the best dining destinations around town. Broadsheet saw Honda as the perfect partner for ‘Seven Dinners in Seven Nights’.

The competition is an avenue for Broadsheet to grow newsletter subscriptions and reward its audience with an amazing prize that makes best use of our premium hospitality connections. Partnering with Honda on this campaign was a perfect fit and allowed Broadsheet to demonstrate the Honda HR-V positioning within the campaign content and wider campaign collateral.

The partnership with 28 restaurants in four cities across Australia enabled the Honda HR-V to be aligned with the most current and trending dining experiences in this country.

In addition to the competition, Broadsheet explored and uncovered the lesser-known parts of our cities, through its ‘Uncharted Menu Territory’ series. Broadsheet took the Honda HR-V to one largely unknown restaurant located outside of the city in each state to demonstrate that a world of discovery awaits inquisitive diners and drivers. This content aligned the Honda HR-V with a spirit of exploration and food-related adventures.

Execution: To maximise investment in the ‘Seven Dinners in Seven Nights’ competition and ensure that the maximum number of competition entries was received across the network, Broadsheet created the following marketing and content strategy.

Content:

- four competitions (Melbourne, -

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Sydney, Brisbane, Perth) with custom design assets, four dedicated competition hubs in each city, 12 content pieces integrating the Honda HR-V in photography, published and promoted on Broadsheet, four solus eDMs (Melbourne, Sydney, Brisbane, Perth databases), multiple Broadsheet eDM inclusions (Melbourne, Sydney, Brisbane, Perth), and creative co-branded display assets and homepage takeover in each city (Melbourne, Sydney, Brisbane, Perth).

Social media:

- extensive social promotion

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to a national audience of more than one million including 32 Instagram assets, more than 25 Facebook posts and Instagram story coverage during the winners’ dinners, influencer engagement strategy, and coverage across Honda’s social media channels.

Results: Showcasing Broadsheet’s extensive dining connections throughout Australia, the competition was extremely successful in compelling audiences in Melbourne, Sydney, Brisbane and Perth to enter, driving database subscriptions for Broadsheet and Honda.

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Charting the rise in competition entries from the original 2014 competition to 2017, there was a 76% increase in Melbourne entries and a 119% increase in Sydney entries. For first-time cities Brisbane and Perth, the strong entry numbers demonstrated the appetite for food and beverage content and connections in both locations, as well as Broadsheet’s growing audience. This means the KPI of 40,000 entries set for the 2017 competition was not only met but greatly surpassed, giving Broadsheet the impetus to grow future collaborative competitions even further in the coming years.

More than half the people who entered also opted in to receive emails from Honda.

From a partnership perspective, Honda was able to successfully tap into the key audience of explorers and foodies in each city reaching more than 660,000 people via social media and driving more than 78,000 uniques on Broadsheet.

The average time spent on Honda content on the Broadsheet site was over three minutes, showing that this competition and the content that supported it was useful and engaging. This campaign was promoted organically via Broadsheet’s social media channels – there were no paid or boosted posts.

Broadsheet positioned the HR-V as a vehicle for dining adventures and discoveries. Broadsheet Studio created interesting and design-led content for both Broadsheet and Honda’s channels.

82 SPONSORED

A new digital age dawns at Sydney’s home of sport marketingmag.com.au

The SCG’s new membership portal is revolutionising one of the world’s most famous sporting venues

Photo credit: © AFL Photos

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he Sydney Cricket and Sports Ground Trust and its marketing and membership team wanted to take its customer engagement to the next level. Its existing customer engagement platform had been in place for many years and was holding back the membership team’s interactions with the SCG’s 19,000 members.

A new CRM portal was required to provide members with a better customer experience and, ultimately, a far more user-friendly digital experience. What was multistep and time consuming needed to become simple and intuitive to meet the needs of the SCG Trust’s customers in the digital age.

The Trust enlisted the help of Avanade, after the firm’s previous successful work with the MCC and Cricket Australia.

Avanade’s previous work with Cricket Australia on its Cricket.com.au website and official Live app saw the rollout of a slick range of solutions helping Cricket

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The new CRM system is one of the most significant upgrades in the SCG’s recent digital transformation, revolutionising how we interact with our large and engaged membership base Australia with mobile app development, web portal implementation and analytics and social media integration – capabilities it required to engage a new generation of digital-hungry sports fans. The partnership resulted in Cricket.com.au making it to the number one sports site in Australia for December

The ongoing development of the CRM is vital to improved CX, increased revenue opportunities and streamlined working processes 2014, an 80% increase in website audience, more than 23 million unique visitors, 29 million video views and 1.2 million live app users, and impressive social media cut-through.

The SCG Trust needed a partner to work seamlessly with its project team towards its clear goal of membership satisfaction, membership revenue, and uplift in new members and renewals.

Also important was a new centralised CRM that would streamline existing processes to improve the quality of customer interactions.

Using Microsoft’s Dynamics 365, the SCG Trust would see immediate operational improvements from its CRM. New processes were learned along the way, making previously laborious tasks far simpler and easier.

“The ongoing development of the CRM is vital to improved CX, increased revenue opportunities and streamlined working processes,” says Jane Coles, general manager – membership, marketing and information communication technology at the SCG Trust.

“The new CRM system is one of the most significant upgrades in the SCG’s recent digital transformation, revolutionising how we interact with our large and engaged membership base,” Coles says.

This article was sponsored by Avanade, the leading provider of innovative digital and cloud services.

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84 BEST OF THE WEB: EDITOR’S CHOICE

As the government coffers dry up, arts organisations need to get better at talking to brands, and brands need to wake up to the art opportunity they’ve been missing. Karen Monaghan has some matchmaking advice.

rands need art organisations and arts organisations need brands. Servicing brand partners, however, is an intensive activity and often lean artistic organisations lack the resources to deliver on this promise. Likewise, CMOs have enough on their plates without having to weigh up the merits of aligning with cultural events or businesses.

This is where agencies come into the equation. Agencies have long played the role of middleman between consumers and brands.

It’s a similar relationship between arts organisations and audiences.

With a recent study showing 98% of Australians engage with the arts, it has become a target CMOs cannot ignore.

The arts provide a platform to engage an increasingly difficult-

B

to-capture youth audience while reaching the population at large. In short, they’re every marketer’s dream.

Agencies are adept at bridging the gap between these two camps.

But it goes deeper than that. In truth, most people who go into creative industries are themselves frustrated artists. Talk to just about anyone in an agency and they will tell you they love to paint, write or make music. However, they also need to pay their mortgage. We may be frustrated artists, but we are commercially minded. We don’t like to think of it as selling out. Instead, you could say we have a lower commercial threshold. Whichever way you look at it, this is a skill-set arts organisations, and brands, can benefit from tapping into.

Traditionally, arts organisations looked to brands as a linear

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Karen Monaghan is client development director at Neonormal and chair of the marketing committee at Melbourne Writers Festival.

revenue stream – you provide us with this much cash and we will provide you with some tickets and logo placement. And if you pay us enough, your VIPs can meet our opening night speaker, too.

With more competition for budgets, there has been a shift in brands providing contra or goods and services rather than cash. For arts organisations that have very little medium- to long-term funding, this impacts future planning, which in turn limits the ability to forge ongoing brand-building partnerships, which ultimately diminishes the value for a brand.

The smart operators on both sides of the equation are instead looking for relationships they can grow, allowing time to deliver on a joint brand-building platform in a meaningful way. This is perhaps more evident in the philanthropic space than corporate partnerships at the moment, but it’s definitely moving in this direction on both fronts.

Arts organisations have typically had many smaller partnerships, but this is also changing. Savvy organisations are now looking to invest in fewer but deeper

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Why bringing brands and arts organisations together is a win-win

“When teams from diverse organisations collaborate strategically, creative thinking escalates, productivity improves, energy lifts and teams are more likely to think beyond the executional demands, put themselves in the shoes of the audience, articulate and measure the real outcomes.”

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relationships. Organisations that have already gone down this path are seeing a positive flow-on effect to budgets because servicing partners is resource intensive, no matter the size.

A MARRIAGE OF MORE THAN CONVENIENCE The Australian art community’s unique relationship with the government puts arts organisations in a difficult position when it comes to financial support. As this pie gets smaller and smaller, arts organisations need to get better at engaging brands.

There is good news for arts organisations: corporate brands are looking to build strategic partnership portfolios. But, in many instances, agencies are the gatekeepers and brand experience agencies tend to hold the keys to brand partnership portfolios. That is because we know what our clients are looking for and the types of partnerships that align with their brand.

The strongest partnerships have a shared understanding of ‘what’s in it for me?’ They have a clear understanding of the alignment

between the organisations and know exactly where the sweet spot is. They move towards completing each other’s offer, providing a more compelling experience for the audience.

Where there is great alignment, the reasons an arts organisation needs a brand partner are the same – build credibility, community, engagement, reposition, reinforce values and appeal and, of course, increase revenue while allowing for innovative programming and growth.

With this in mind, organisations that approach agencies in the first instance have a better chance of achieving cut through. A tailored pitch, guided by people who know the brand, gives you better odds than a generic proposal going out to seven different brands, sometimes with the name of the last brand approached still on the document.

Similarly, agencies can help CMOs to discover artistic businesses and events that not only match the needs and values of their brand, but actually elevate the organisation.

THE VALUE OF ALIGNMENT Audi’s support of the arts in Australia through its partnerships with Sydney’s Museum of Contemporary Art, as well as the Melbourne and Sydney Theatre Companies, is a great example of a brand communicating its message to a carefully curated audience. Through these partnership initiatives, Audi has become known as a great supporter of the arts while extending its reach outside of the dealership as it gets cultural consumers’ bums on seats and hands on the wheel of the next car they had not realised they wanted.

As in the case of Audi, the right fit for a brand is one that sees mutual alignment with the aesthetics, style, perceptions and values of each entity. The partnership can then build credibility with a community, whether it be

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an emerging brand that is building awareness or a mature brand that is repositioning, relaunching or in need of reputation management.

The value for the employees of each partner in the equation is not to be underestimated. Creativity feeds creativity. When teams from diverse organisations collaborate strategically, creative thinking escalates, productivity improves, energy lifts and teams are more likely to think beyond the executional demands, put themselves in the shoes of the audience, articulate and measure the real outcomes.

Agencies then come into the equation to help with the heavy lifting, allowing arts organisations to do what they do best – push boundaries in creative programming providing inspiration, enlightenment, nurturing, challenging and rewarding experiences – and brands to reap the benefits.

It can be tough out there for arts organisations, particularly when they’re going up against more commercially led events such as music festivals. Equally, it can be difficult for brands fielding, vetting and weighing up the value of getting into bed with arts organisations.

Agencies are often the best weapon to get over this hurdle because – I’ll let you in on a secret – agencies love working with arts organisations just as much as they love working with brands. It’s the perfect intersection as it gives us an opportunity to flex our creative muscles while calling on our commercial minds. For teams of frustrated artists, you can’t go past that.

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Read more like this in our dedicated Brand Management section on Marketingmag.com.au

86 BEST OF THE WEB: MOST SHARED

Post-human advertising

Scott Button is co-founder and CEO at Unruly.

rtificial intelligence (AI) is becoming so embedded in the everyday that we risk not noticing it at all. Self-driving cars, humanoid robots and Go grandmasters may grab the popular imagination, but it’s the way that AI is seeping into everything from voice recognition to fast food delivery that better illustrates its quiet ubiquity.

Voice controlled personal assistants like Amazon’s Alexa and Apple’s Siri are getting smarter day by day, along with most other connected devices.

In the domain of digital advertising, machine learning has already been with us for several years. Well-known techniques – from regression analysis to deep learning – are being used to combat ad fraud, optimise ad viewability, improve audience composition and enhance goal conversion. The vast amounts of data generated by ad tech platforms and the fast feedback

A

loops enabled by real-time media buying have made digital advertising an especially fertile proving ground for AI. What’s new and different today is the widespread availability of cloud-based AI platforms, turning machine learning into a utility – one that’s cheap, fast and accessible to anyone that wants to use it.

A great example is IBM’s Personality Insights services, which uses the company’s Watson platform to analyse data from social feeds in order to predict an individual’s personality and key traits.

It’s uncontentious that differing psychological traits influence receptivity to advertising. The extrovert is more likely to share an ad. The conscientious individual is more likely to respond to an offer.

Now machine learning techniques like IBM’s service mean that we can analyse tens of thousands or hundreds of thousands of people,

MARKETING OCTOBER | NOVEMBER 2017

very quickly and very cheaply.

By combining this data with information on people’s purchasing habits – all collected through an opt-in survey – Unruly quickly found that we could create interesting aggregate personality profiles for different brands and different customer segments.

In essence, we could utilise Watson to help advertisers to learn how and why people think, feel and act a certain way.

In the first instance, we’ve integrated these machine learning capabilities into our targeting tool, to allow advertisers to improve the accuracy of their online marketing campaigns by engaging the people most likely to increase a brand’s sales – light buyers.

This new iteration of the tool is built on large-scale consumer panel studies with more than 10,000 respondents, combined with insights from the social media accounts of

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Never mind the automation of mundane tasks; Scott Button says AI is about to disrupt creative roles, advertising and culture.

“Thinking further into the future, it’s not crazy to speculate about the creation of the world’s first AI ad agency”

@marketingmag

participating consumers. We use a mix of linguistic analysis and machine learning to determine the socio-demographic and psychological profile of each panellist, clustering and aggregating the profiles based on buying patterns and purchasing frequency.

We’re really excited to be at the forefront of this new world, but this is just the start.

The world’s first AI media agency already exists. Blackwood Seven was set up three years ago.

It’s slightly intimidating, but seems fairly obvious that machines will do a better job of planning and optimising media than lightly trained execs shuffling Excel sheets around.

But what about creative?

While digital has always promised the possibility of customising (and then multivariate testing) thousands of creatives for different audience clusters, this strategy has tended to fall over in practice or be implemented simplistically because it’s expensive and slow. If AI can make it fast and cheap, it may just revolutionise mass marketing.

Thinking further into the future, it’s not crazy to speculate about the

creation of the world’s first AI ad agency, perhaps implemented as a generative adversarial network.

One neural network churns out thousands of ideas and storyboards with the goal of them being indistinguishable in terms of originality, relatability and emotional impact from awardwinning campaigns of the past and present.

A second neural network then rates the ideas of the first and attempts to figure out which ones are really award-winning human-authored efforts and which machine-generated, thereby generating further feedback for the first machine.

What’s vertiginous here is not so much the breathless pace of technological change, but rather the trajectory on which we’re headed. In the not-so-distant future, machines will be better than us – not just at the mundane tasks that threaten hundreds of millions of jobs in the developed and developing world, but also at the sorts of things that we think of as being elevated and distinctively human, including the creation of advertising and culture.

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The claims here ought not to be especially surprising or contentious, though perhaps the evidence is, through being so close to our noses, becoming increasingly invisible to us. In many areas of life we’ve already handed responsibility to intelligent machines – news and our life stories to social networks, navigation to mapping apps, collision prevention to autonomous driving systems, medical diagnosis to neural networks, life partners and one night stands to dating platforms.

EdgeRank. PageRank. We trust the algorithm to know us better than we know ourselves.

This is the end of the human as we know it. Humanity displaces God, Machine displaces Humanity and, more prosaically, Algorithm displaces Ad.

@

For more on AI, check out ‘Artificial Intelligence: A Marketing Manager’s Definitive Briefing’ at goo.gl/ PfFmXc

88 BEST OF THE WEB: MOST READ

Report card 2017: how media and marketing are performing

James Boardman is national head of strategy at MEC Australia and New Zealand

o far, 2017 has been a year of reassessment and substance over style. The marketing profession is losing its infatuation with buzzwords and collecting data for the sake of it, in favour of real insights and analysis. The result is smarter, more targeted advertising.

Here are the five defining trends to emerge this year and how they stack up in our report.

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KEEP UP THE GOOD WORK: MANAGING THE MEDIA MIX For 50 years, ‘the right content, to the right people, at the right time’ meant TV. For the past 15 or so years we’ve been relearning the art of complexity and we’ve been getting a lot wrong. Now, the marketing industry has finally become better at managing complex media mixes in a sensible way.

Importantly, the shiny new toys are under more scrutiny and

traditional channels are being reappraised with fresh eyes. This has helped with managing our messages better and thinking more broadly and carefully about our target audiences.

campaigns used social channels as part of their media strategy, few used social as a lead media and usage of social media as a lead channel has declined by 40% since 2012.”

MOST IMPROVED: SOCIAL MEDIA USAGE

PLEASING PROGRESS: FITTING PURPOSE TO CULTURE

While the furore around brand safety and viewability has consumed a lot of column inches and screen time this year, it’s actually part of a bigger trend in marketing – brands are becoming savvier about how they use social media. They are opting for fewer, bigger, better pieces of content rather than a constant stream of useless annoying content.

For the first time, according to the latest IPA analysis in the UK, more award-winning campaigns had social media in them than had TV in them. Interestingly, the IPA had this to say: “However, while most

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There’s been a lot of talk about brand purpose in recent years, but it’s only now that brands have become more sophisticated in how they tie together purpose, product and cultural insights – and that makes for more relevant and interesting campaigns.

Take Vodafone’s DreamLab, an app that allows users to help find a cure for cancer by pooling their smartphones’ computing power to create a ‘supercomputer’. Vodafone is not claiming to be anything other than a telco – it’s just using the

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James Boardman takes a look at the trends that are making their mark on the marketing industry.

Marketers are chasing Millennials because for a brand to be successful in 20 years’ time, we need Millennials and Gen Z to feel positively about our categories and brands.

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power of its customers for a greater societal benefit.

P&G’s long-running ‘Thank you, Mum’ campaign didn’t try to present P&G as an unrealistically ambitious, world-changing, poverty-solving company. It merely set it up as a champion of mums. Again, this is brand purpose at a scale that is connected to products and what everyone knows your company to be. It is brand purpose that encourages reappraisal, not flights of fantasy. The end of the ‘stuck out on a limb’ CSR initiative is nigh.

TOP MARKS FOR EFFORT: USING MEASUREMENT TO LEARN AND IMPROVE Marie Oldham, chief strategy officer of VCCP UK, commented on the recent IPA Effectiveness Awards that the winning papers “are the ones that take it right through to a proper analysis of exactly what worked in the campaigns, what effect communications had among all the other things you did and working that right through to an ROI based on profit”.

She’s right. Before digital, we had only a small amount of data,

so we were good at analysing it.

Post-digital, we got so focused on counting that we forgot to analyse. The most successful of the recent IPA Awards campaigns set on average 3.6 metrics – in other words, not trying to count everything, but rather focusing on the things that really matter helps avoid annoying audiences with ineffective campaigns.

DEMONSTRATES WILLINGNESS TO LEARN: EXPLOITING TRUE MISSED OPPORTUNITIES The IPA recently identified that companies are increasingly heeding the advice of Professor Byron Sharp and his colleagues, and focusing on penetration and profit at the expense of targeting narrow audience groups. This trend is interesting for two reasons – it helps us avoid bombardment of existing customers and bring new audiences into the mix; and it starts to temper our fascination with those elusive things… Millennials.

Marketers are chasing Millennials because for a brand to be successful in 20 years’ time, we

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need Millennials and Gen Z to feel positively about our categories and brands. But we also need to balance long-term brand building and shortterm sales – and that’s something we’re all increasingly focused on getting right.

Since the publication of Sharp’s How Brands Grow in 2010 and the work of Les Binet and Peter Field (The Long and Short of It, Marketing in the Era of Accountability, Selling Creativity Short), we’re seeing an increased focus on growing market share rather than constantly trying to extract more from existing customers. That means focusing on all your potential sources of growth – young and old.

Finding missed opportunities is more important than blindly targeting Millennials in the hope they’ll fix all our growth issues.

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90 SAMMARTINO ON SHIFT

Ditch the spreadsheet The benefits of great service can’t always be measured and are often the result of breaking the rules, writes Steve Sammartino.

The hotel Scenario: I sit down in the restaurant to start my day. I request a latté only to be informed that it’s not included in the $30 breakfast. I’m pretty sure I’ll eat less than $30 worth of eggs and fruit and toast, but I’m forced to pay a further $4.

I can afford it, and I’m not angry with the staff member following the rules. I sign the receipt. But here’s what I notice. The staff is spending so much time fulfilling bespoke coffee requests (heck, it’s only been a decade since anyone tolerated pot coffee!) that the tables aren’t cleared and people are waiting to be seated.

It’s easy to understand why real coffee isn’t included; it’s not part of the factory system most businesses are built around. It will require some reconfiguration. It takes more labour, and those costs will appear in the spreadsheet. It may require putting hospitality before profit. But with a little bit of effort, I’m certain an efficient system to make the lattes on demand could be built.

Next time I’m interstate on business I’ll reserve my $300 hotel room for the hotel brand that wore the cost of a $4 coffee. The $296 upside won’t appear in any spreadsheet.

The bank Scenario: I call my bank about obtaining a loan for an investment.

I have done my banking with them

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Steve Sammartino is an author and futurist who sees the world through marketing eyes. He has held many senior marketing positions and has also built and sold his own start-ups.

His latest venture is Sneaky Surf, which is bringing technology into the surf industry. His new book The Lessons School Forgot: How to hack your way through a technology revolution is out now through Wiley.

Connect with him and see his latest projects and blog at stevesammartino.com.

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f you’re looking for a singular narrative with an astounding conclusion about service strategy, you won’t get it here.

I’m instead going to start out with some corporate folly we’ve all had to face in marketing, and then a set of vignettes that prove what service really is, and that its core requirement is not based on some kind of strategic advantage or expensive research, but mostly humanity, sprinkled with a little bit of courage.

The art of service is the sum of the parts. It’s the fight against a corporate machine driven by rules and efficiency. But anyone can choose to go off script, which is what it usually takes for service to be added to a successful repertoire.

Let’s start with the folly. Not everything that is important in business can be measured. The spreadsheet culture permeating corporate society would have us believe all things that matter can be slotted into a column, quantified and evaluated. That would only be true if companies didn’t have to interact with actual people somewhere along the line. In fact, the best experiences I’ve ever had with any firm are usually when someone in the organisation had the courage to break some rules, and invest some financial humanity on the company’s behalf.

for more than 10 years. The person on the other end of the line asks what I’m after and says it all should be possible, if the information I’ve provided is accurate. They proceed to tell me I need to provide copies of all the information we discussed. It involves a menagerie of information they already have: income, expenses, credit cards, debt, valuations of houses and assets… the list is long.

I remind them I do all my banking with them and they already have this information. They explain that, for reasons out of their control, I have

I quickly write a blog post advising people how to ensure they get the best price too. The blog post blows up. I feel good, like I have done a service for society, and at the same time maybe reminded an old world firm that loyalty ought be rewarded, not derided.

business lounge. What’s interesting is that it took an entirely new cost infrastructure for reasonable service to occur. Maybe they could’ve just trusted people on the ground who had face-time with actual customers to make such decisions and saved some money?

The airline

The tech company

Scenario: I arrive at the airport to check in for my flight. I’m told it’s delayed by three hours. I ask why they didn’t call or text me with an update. The person checking me

Scenario: I want to participate in the modern economy and, although I’m not fond of the surveillance that goes along with all our smart digital technology, I’m left with little choice. The price of participation is to say ‘yes’ to things most of us can’t understand, things we know are written to be used against us if required.

The terms and conditions of modern life are written to obfuscate the true value of what we are handing over. At this point in modern history we have few options. Most people don’t even read the terms, and everyone knows it. So, for now, tech companies get away with inventing their own quasi-legal, political and economic conditions via a public without choice. In doing so, they’ve invented global scale and dominance not seen outside the order of imperialist nation states. I remind myself that this is a temporary phenomenon; I grin and bear it.

But they too will eventually face the same service challenge.

The entrepreneurial opportunity of tomorrow is the arrogance of today. Choice will emerge, where the consumer disdain of the tech giants will form the brand proposition of the new challenger – it always does.

Technology has a way of finding new ways to solve old problems and no company – no matter how bleeding edge – is immune to progress.

People make big decisions on small, seemingly fickle, things. The same things ironically that usually define what makes us uniquely human.

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The best experiences I’ve ever had with any firm are usually when someone in the organisation had the courage to break some rules.

to provide copies of the information that came from them, in hard copy, to them. Disappointed, I remind myself that money is a commodity and can be obtained elsewhere, especially when service and effort seems optional from the provider.

The cable TV company Scenario: While watching free-to-air television, I see an ad for the pay TV company I subscribe to advertising a much better price and breadth of content than I currently receive. I call to ask for the same deal – I feel I deserve it as a long-time, loyal customer. I’m told that this deal is only for new customers as an incentive to get them to sign up. I tell them to disconnect my service. They put me through to the retention team (this also tells me there is a problem with their marketing strategy). After a short discussion, I get the new, better deal.

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in assures me a text was sent to all passengers. I proceed to show the person my phone, sans delay message. Despite my physical evidence, they tell me I am wrong: a message was sent – I must have deleted it or something.

It isn’t worth me returning home and coming back. To assuage the negative vibes, I ask for access to the business lounge as a way to endure the extended waiting period. The person I’m dealing with denies me the privilege, saying this decision is not part of their department.

I remind him of the logo on his shirt, and that I don’t deal with departments, just companies.

He’s sorry; he can’t help me.

So, I resort to Twitter, make a public whinge to my thousands of followers and, like magic, I get a call from the social media management team. All of a sudden, my social media status gets me access to the

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92 VALOS & LEE

Productive industryuniversity partnerships T

he current crop of innovation driven companies collaborate closely with universities.

Facebook recently allied with 17 universities, and Google and IBM have always cooperated closely with educational institutions to develop areas like artificial intelligence (AI). The information and knowledge that flow from these partnerships help them gain and sustain competitive advantage.

Paradoxically, Australia – the research and discovery institutions of which are globally ranked in the top 1 to 2% – ranks last in the OECD (Organisation for Economic Cooperation and Development) for business-university collaboration. How do we turn this around?

Benefits Claus Otto from Shell has a good question, “What can these university centres do better or differently than we can?”

Paul Pierotti, president of the Griffith Business Chamber and a recent collaborator with the authors on a place trust-mark creation project to increase the value of products and produce from the Murrumbidgee Irrigation Area answers: “Collaborating with university brings more credibility to a project and facilitates access to a wider range of stakeholders. University lecturers

handpick students to work on the projects and deliver work that is as good as, or better, than industry at a very competitive rate. Overall, the relationship is very good value for money and has provided insights that are concrete and theory driven.”

This highlights the cornerstone of industry-academy collaborations.

Universities have students who are bright and willing. Higher education also provides an external and a big-picture perspective to challenge and/or validate organisational thinking.

University researchers have developed and honed their lateral thinking skills under a publish-orperish regime; to be published, they need to develop novel concepts and demonstrate their workability.

This type of lateral problem solving is diagonal to the nature of industry work, which is often consumed by routine that leads to missing innovation initiatives.

Partnerships also let managers access academic skills in investigative methodology. Well-published faculties tend to have a depth of understanding of research processes that are not generally available to executives. This complements the executive’s knowledge about how things are done in industry and helps to solve new problems.

Undertaking applied research that addresses the needs of business,

MARKETING OCTOBER | NOVEMBER 2017

Michael Valos is director of industry engagement in the Department of Marketing at Deakin University and chair of Marketing’s industry advisory board.

Dr Alvin Lee is director of the Master of Marketing in the Department of Marketing at Deakin University.

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Michael Valos and Alvin Lee explore the benefits and barriers of fostering relationships between businesses and educational institutions.

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while also adding to the existing knowledge base, has been a hallmark of the research undertaken by Professor Andrew Noblet. Having worked with organisations to develop strategies that can protect and promote the health of employees, Noblet believes that developing collaborative decision-making processes that generate a sense of joint ownership is critical for building lasting partnerships.

“Our role is not to tell companies what to do. Instead, we need to work with all levels of the organisational hierarchy to identify issues and problems that are important to them and then to use their ideas and insights to come up with sustainable solutions.”

There are members of academia who work across disciplines and others with depth of focus in a small, defined area. Both add value to industry in terms of breadth and depth of expertise.

While industry uses a shortterm quarterly focus, educational institutions work with longer time scales. The contrast is complementary: business focuses on doing, while academics are afforded the luxury to think through the intricacies of concepts more deeply, so that business can do it better.

A large benefit is reputational as affiliation and publication between researchers, universities, executives and companies bring synergy to projects. This builds a franchise to attract customers and better employees.

Barriers Who owns the intellectual property that is developed? Professor Chris Dubelaar submits a solution: “The research data created in working with an industry partner is invaluable for academic publication, as long as you have a clear arrangement of what can be used. You don’t want to damage

the organisation by publishing too early or in a way that defeats their competitive advantage.”

Some executives lament that academics are not commercially oriented. Indeed, some universities are populated by researchers who lack industry experience and credibility. This is improving. With university accreditation metrics that measure how universities engage with the community and industry, lecturers have to get ‘practical’ experience. Universities are also bureaucratic places that have slow processes; this is counter to the industry partner’s normally speedy responses.

In the Murrumbidgee project, we worked closely with industry to tease out the strengths of each party. We supported each other to identify the result that was needed, the way to achieve the result and the give-andtake when negotiating the contract.

Despite these barriers, all is not lost. We have collaborated successfully with companies like CGU, Federation Square, Griffith Business Council, Heinz and the AFL. We have also delivered multiple projects for NFPs, NGOs (non-government organisations) and government.

Sloan MIT Management Review reports, “Too often, companies

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Business focuses on doing, while academics are afforded the luxury to think through the intricacies of concepts more deeply.

Vague findings that cannot be used to create courses of action can kill a partnership. This happens because many scientists struggle to focus on key deliverables and overload the industry partner with irrelevant findings and lengthy discussion. This can be overcome through better vetting processes that scrutinise the communication processes to confer research findings.

Some researchers hurry to publish their findings, to the detriment of the industry partner.

Here, industry must clearly indicate in the contract that they have the ability to embargo publication before the idea is commercialised.

Sometimes, the contract needs to include provisions to maintain the firm’s anonymity to protect competitive advantages.

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pursue collaboration with university researchers in an ad hoc, piecemeal manner. But by giving more thought to the relationship structure, companies can achieve better results.”

Success comes from cooperation mindset, integrity, flexibility and respect for the perspective that industry and academy bring.

The highlight of any collaboration is what the students bring. Scott Gunther, general manager, customer insights at IAG, writes partnerships provide a completely fresh approach to insights and research. Not only do we have youth and enthusiasm and a desire to do an amazing job, we have perspectives and opinions that aren’t jaded. Of note is also the generational skew that university students can bring, as they are in the Gen Z and Gen Y demographic, and this is our next generation of customer.

94 SÉRGIO BRODSKY

Friction versus seamlessness A

Sérgio Brodsky is an internationallyexperienced brand marketing professional, having worked for some of the world’s greatest strategic communications agencies. Sérgio is a proven thought leader, speaking at industry events, lecturing and regularly being published worldwide. He is passionate about cities and culture and the role of brands and technology in society. Sérgio is multilingual and holds a BA in IP law and an MBA in global brand strategy and innovation, and he is a scholar of The Marketing Academy. Follow him on Twitter: @brandKzar.

brand’s job is to create a shortcut. By encoding meaning that resonates with target audiences, brands make consumption choices easier. Like magnets, strong brands attract our attention.

Yet automation advancements are pointing towards Doomsday for brands. From a series of staged choices, consumers are moving by inertia through their paths-topurchase, with their more mundane choices made obsolete.

Using an AI deep-learning algorithm developed at CERN to manage its stock, German retailer Otto has been able to predict what customers will order with 90% accuracy. Otto buys products from suppliers without human intervention by looking at 30 billion transactions and 200 variables (e.g. weather).

This reduced two million stock returns and surplus stock by 20%.

Wheelys’ Moby Mart is a 24-hour unmanned, mobile shop that captures biometric data to avoid theft and ensure greater personalisation.

The start-up’s founders have plans for a cloud-based system that will store and analyse information about customer behaviour and preference, helping shop owners predict what products to sell and where. They

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even see a time when the wheeled shop will be able to autonomously restock by driving itself back to warehouses when supplies run low.

Automation removes complexity of choice with algorithmically verified suggestions that get us and consumer reviews that reassure us.

This way, the 'non-experience' is emerging as the new benchmark to shopping. Predetermine everything; choose nothing.

On the other hand, not all choices are that simple or can be outsourced.

Plus, not all consumers are the same. Otto’s mass personalisation triumph risks becoming a ‘personalmassification’ problem. Similar to the phenomenon of echo chambers, giving us more of what we already know we like (before even asking for it) will gradually entrench our tastes.

We don’t shop to escape reality but to animate it. In a 'non-experience' context, however, where the act of shopping is reduced into our personal frames of reference, purchases will stop animating routines to become routines. Therefore, our commercial participation in life, through the brands we buy, is also reduced.

What now?

Looking at Clayton Christensen’s latest innovation theory of ‘Jobs

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Brands focusing on frictionless customer experiences are at risk of undermining the reason for their success. Sérgio Brodsky on brands transcending product and path-to-purchase.

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to be Done’, the antidote to his very own theory of ‘Disruptive Innovation’, customers aren’t really interested in products, services or brands themselves, but on how they address needs.

Retailers and FMCG companies suffering from disruption should certainly attempt to remove negative frictions. Becoming frictionless, however, will not deliver a true advantage. This will only help undermine the very reason that made them successful – the meaning they encoded in people’s minds. "We don’t think about what we remember – we remember what we think about," says Harvard Educational Neuroscientist and expert in human learning and memory Dr Jared Cooney Horvath. "Remove friction and you remove explicit thought.

Remove explicit thought and you kill brand recognition."

The newly created FMCG start-up Brandless compels people to choose for it. Despite its no-logo attempt and seamless e-commerce platform, the attributes respectively listed on its website and packaging design follow strict guidelines creating a distinctive look and feel or… brand!

Choice is not removed, but cleverly articulated. How? By inviting people to join the hipster consumerist ideology when purchasing. Brandless, understanding that breaking into the cultural code of the places it operates will often succeed, has partnered with Feeding America, the nation’s leading domestic hunger relief organisation. This way, Brandless enables buyers to display a sense of self and show where they stand in relation to others.

Second to the role of being shortcuts, brands inform our identities.

While imperfect and incomplete, brands disarm our fear of the unknown by allowing us to see someone else’s choices, social status, political

orientations and more. And when considering all controversies of modern life, there are plenty of jobs in need of a brand – something a commoditised pipeline cannot address.

One of the most heavily commoditised categories is toilet paper. As important as its mission is in the world, who really cares about it outside that moment of need?

As such, toilet paper is an ideal candidate for entering transactional subscription models. The risk is, losing the integrity of your consumer data to the platform responsible for distribution. To avoid that, create new meaning. There are plenty of toilet paper brands winning by taking an initiative in culture.

For example: Who Gives a Crap –

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he nonexperience is emerging as the new benchmark to shopping.

Predetermine everything; choose nothing.

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by donating 50% of its profits to help build toilets in the developing world, it turns our most private moments into shared ones. The experience of wiping your bottom is the same as with any other toilet paper roll with the same specs. By creating a community of interest through a cause, however, Who Gives a Crap has become one of the best indicators of someone’s ethical values and a social glue for like-minded people. It also has a

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subscription-delivery service.

Charmin’s SitOrSquat app – SitOrSquat was developed from the strategy of connecting Charmin with innovative conversations and solutions, as a brand that understands the importance of bringing the best bathroom experience to consumers, even when they’re away from home. In response to those awful moments of not finding a toilet, Charmin listed thousands of toilets across more than 10 countries and extended and reinforced the brand presence at different locations.

Missed opportunities The culture equality debate is fierce nowadays. Spanning gender, age, political orientation and more, our cultural differences were never so salient. All differences considered, bottom-wiping certainly unites us.

So why haven’t more toilet paper brands attached themselves to such a rich cultural stimulus?

In Canada, students from Ryerson University created the ‘Toilet Paper Equality Row’ protesting against the fact that bathrooms throughout the university are stocked with one-ply, with the exception of those in the administration building. Leveraged by the headline ‘Two-ply toilet paper creates two-tiered Ryerson’, brands could have jumped on sponsorship, activations or more opportunities.

‘The Everyday Sexism of Women Waiting in Public Toilet Lines’ was an article published on Time magazine’s website and I have not noticed any native or interruptive ad units there. Why not?

It is only in the company of an audience that we can find purpose to our stories. Whereas automation brings many benefits to our busy, modern lives, it also risks removing opportunities for memorable brand experiences.

96 PHILLIPS ON LEADERSHIP

Servant leadership

Jac Phillips is senior director and head of marketing, Australia, New Zealand & South Pacific, at Visa.

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here was an uproar. “How dare we be referred to as servants?”

“That demeans us, makes us seem inferior, unequal, without merit.”

They were private bankers and a journalist had published an article in which a senior leader from a bank had referred to private bankers as being ‘servants’ to people with complicated lives and complex financial needs.

‘What’s the problem?’ I thought.

Serving others is a universal purpose for the majority of the world’s workforce. What did these two private bankers think their job was?

I am fast collecting words that need a rebrand: ‘retirement’ is one, ‘feminist’ is another, and I think I

may add ‘servant’ to the list. Some have a view that serving others means you are of less value, that you are not worthy of equality, you’re not successful; however, if you Google the definition of ‘servant’ the following pops up: = a person who performs duties for others, especially a person employed in a house on domestic duties or as a personal attendant, = a person in the employ and subject to the direction or control of an individual or company, = a person employed in the service of a government, and = a devoted and helpful follower or supporter.

I personally relate to these definitions. I don’t consider myself of less value or unequal.

Today, when service has become a word discussed so frequently, where we constantly compare good and bad service in retail, hospitality, travel, finance and other industries, it is interesting to consider the role of humility in the service experience.

Great leaders secretly know the essence of getting people to follow you is to understand them better than anyone else. Humans are generally simple beings who have six needs that influence our deepest motivations and determine how we prioritise decisions throughout our life: certainty, variety, significance, love and connection, growth, and contribution. You can get some people to do as you demand for a

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while, but that’s not the only way.

The primary difference between servant and other forms of leadership is that servant leadership primarily focuses on the followers, not on a leader-defined agenda or an organisational bottom line.

(Holy Mother of profit reporting, forgive me!)

Servant leadership, in essence, is to lead with service above self and for others’ benefit. Quite simply, it’s not about you. Albert Einstein got it: “Only a life lived in the service to others is worth living.”

So rather than just typically engaging the rational and practical dimensions when managing your people, with servant leadership you also work hard to understand emotional and relational characteristics. And here’s the game changer: if you help your followers (or employees or customers) be more satisfied, it can encourage greater commitment, a higher intention to remain and ultimately greater organisational citizenship behavior.

Fluffy? Is servant leadership the new designer business-spoodle?

It certainly would be a foreign concept for those used to an office environment focused purely on making money, or an organisation that follows the process and the leader’s mandate.

I like to think of servant leadership as a more holistic leadership model with the objective of generating a ‘superior

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If you’re focusing on making yourself a better leader, you may just be focusing on the wrong person, writes Jac Phillips.

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contribution’ or, in business terms, higher performance.

And there is growing demand for prosperity achieved by practising higher levels of corporate and individual morality, as many of those ‘pesky’ Millennials want some divine intervention when it comes to both the brands they work for and the brands they buy.

I recently had the very good fortune to meet an amazing Australian (a former merchant banker who had no issue with being a servant), who left behind his highly paid and successful banking career 15 years ago to co-found a unique and local not-for-profit (NFP) venture called SVA – Social Ventures Australia. SVA reshaped the Australian non-profit landscape, addressing social disadvantage across a number of different sectors all due to Michael Traill’s long-time passion for social justice and his determination to make the world a better place.

I have always considered myself someone who has a strong sense of purpose, but after having a coffee with Michael and then reading his fantastic life story Jumping Ship, I concluded I am but a mere apprentice on the ‘improving the lives of people in need’ spectrum!

In Jumping Ship, Traill refers to the idea of ‘connecting head and heart’ as being a guiding principle for him. With a goal of closing the gap between privilege and poverty, he saw great sense in leveraging the wealth and expertise of Australia’s business leaders to support philanthropy through their commercial experience: strategic advice, specialist business skills and active mentoring to effectively develop and influence the management skills of those running NFPs in Australia.

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Someone wise once said, “If serving is beneath you, leadership is beyond you”. It sums up servant leadership well.

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I asked Traill what he saw as the key influence for wanting to engage more meaningfully to leave a social footprint, and not surprisingly it was his formative years of growing up in a postcode that sits in the bottom 20 percent of Australia.

“Young people growing up in these postcodes are on average two-and-a-half to three years behind their peers in the top 20 percent postcodes by the time they are 15.”

This didn’t seem like a fair go.

From the research I have done on servant leadership, there appears to be an intrinsic relationship between a leader’s early life, their personal values informing and shaping their leadership style, and the servant leadership model. Michael’s childhood was influenced by “a loving family, modest circumstances, a state school education, a strong sense of engagement with his local community and later an awareness of disadvantage and deprivation”.

People who are clear on their personal values, and align these with an organisation’s values, are often described as authentic leaders – able

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to be themselves in the workplace and express their leadership style in a way that is consistent with their inner feelings. A servant leader’s authenticity is demonstrated by doing what is promised, being visible and leading with honesty and vulnerability.

Someone wise once said, “If serving is beneath you, leadership is beyond you.” It sums up servant leadership well, as do [Robert K] Greenleaf’s 10 key characteristics of servant leadership: = listening, = empathy, = healing, = awareness, = persuasion, = conceptualisation, = foresight, = taking responsibility for the role of leadership, = commitment to the growth of people, and = the development of community.

So just who personifies servant leadership the best? According to my references in order to write this article, it is none other than Jesus Christ. So to finish up I am going to quote you something I came across from the book of Timothy (who knew?) “These servant leaders need to be people of strong and proven character. They should be worthy of respect, sincere, not prone to drunkenness, honest, full of faith, trustworthy, and faithful in marriage.”

It pleases me greatly to think I tick the box of seven of the eight according to Timothy! Oh, and in case you’re interested, those two private bankers who took offence at being referred to as servants a few years back, have both since moved into different careers. And with that, I propose a toast to servant leadership – may there be much more of it. Amen!

Way Out

Associate professor Con Stavros is the program director of postgraduate marketing studies at RMIT University and one of Australia’s leading commentators on marketing matters.

Tweet him @constavros.

A

s a young academic one of my prized possessions was a photo taken at a conference in Nashville, Tennessee featuring me alongside the then doyens of services marketing research, Valarie Zeithaml, A Parasuraman and Leonard Berry. The trio of ‘rock star’ status researchers had a few years earlier published their famous SERVQUAL study that introduced, five dimensions upon which the concept of ‘service quality’ could be measured. This was done by comparing consumer expectations to experiences, thus highlighting any gaps that may occur.

That time, almost two decades ago, preceded the huge technological impact that has changed not only the that consumers interact with businesses, but also how they interact with each other. Despite that, and some of the academic scrutiny that the model has endured over the years, I still think the five dimensions exposed in that original work have stood the test of time well. While marketing methods have changed, the question of what

constitutes quality service remains fundamental. Companies need, to learn how to walk before they can run and, given the shabby state of service across many parts of Australian business, going back to basics is a good thing.

The biggest issue with service in Australia is, the inconsistency within many firms. Great service with a company can be followed by poor service in the next encounter, with the luck of the draw as to with whom you are interacting the deciding factor. While that is a generalisation, the fact that I can easily recall firms that fit that description, while struggling to think of others that are consistently excellent, speaks volumes.

Providing outstanding service is challenging. Many customers, including myself, are difficult. I admit it – but don’t apologise for it.

We have high expectations, but we happily complement that trait by also endeavouring to be customers that are also highly desirable: loyal, understanding, reasonable, relatively price-insensitive and just as prepared to praise as to criticise.

MARKETING OCTOBER | NOVEMBER 2017

We are not uncommon; however, we are unfortunately rarely satisfied by what many brands believe passes as acceptable service.

The dimensions of service quality, for those who have forgotten or missed the SERVQUAL dynasty are detailed below. For any firm delivering some form of service – which means pretty much anyone – they remain mandatory things to measure, master and manage.

Reliability – while the order or priority of dimensions is oft-debated and subject to many variables, the concept of actually doing what you are supposed to do, or promised to do, is paramount.

Empathy – I think this psychological component is both vastly misunderstood and underrated by marketers. The caring, perspective-taking and individualised nature of empathy is a powerful connecting force – but keep in mind it must be genuine.

Assurance – interacting with a service provider that actually ‘knows what they’re doing’ sounds a simple ask, but in my experience, it is not so easy to find. Customers are becoming more knowledgeable, making service provider assurance harder to communicate beyond standard certifications.

Tangibles – for those relatively pure service providers the ‘look’ and ‘feel’ of the tangibles associated with a service experience are critical. Unfortunately, in Australia, some firms seem to under-deliver on tangibles, mistakenly presuming that people won’t notice or wrongly assuming that they prefer the ‘laidback’ look.

Responsiveness – the ability to offer quick, insightful and helpful service has been transformed by technology and efforts to better integrate customer experience design into how companies engage with their customers.

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