This Week in Strategy: If anyone gets a message from me about canned meat, don't open it. It's Spam!
(I really hope this week's issue went straight to your inbox!)
Hi Strat Pack,
Let's start off with some hard hitting journalism. As I'm sure you know, Jefferson Besos is taking a sub-orbital flight on July 20th. Thousands Signed a Petition to Ban Bezos From Re-entering Earth After His Upcoming Spaceflight. I considered signing. However I decided against it after reading the line in the petition: “This may be our last chance before they enable the 5G microchips and perform a mass takeover.” There's 5G. Then there's Verizon 5G. and I wouldn't want to add my name to anything implying that the mass takeover is coming from anyone other than the network that built the fastest 5G in the world*. That's 5G Built Right.
On a side note, Amazon has had a rough week in the news. The New York Times published The Amazon That Customers Don’t See, an expose excoriating the company's HR practices. The Information published The Deadly Toll of Amazon’s Trucking Boom (subscription required). And I don't know I just don't care about Prime Day this year. So that's bad news too!
I know I'm going New York Times heavy this week. But you've gotta check out Mushballs and a Great Blue Spot: What Lies Beneath Jupiter’s Pretty Clouds, if for no other reason than to look at absolutely mind boggling photos, like this one of storms on Jupiter's northern hemisphere:
Source: NASA via New York Times
I love space so much. It's so weird and cool.
Speaking of flights over the northern hemisphere, American Airlines and Virgin Atlantic order up to $4bn of electric air taxis. Aviation accounts for 12% of all transportation related CO2 emissions and I think it's great that the industry is looking at green solutions. The current radius is a little over 100 miles which is great for routes like Boston to Nantucket, but I think it gets really interesting if they can get to a range of like 300 miles which would open up a lot of intercity travel in the US at least. I'd fly in an electric plane.
Earlier this week, President Biden signed a law making Juneteenth a federal holiday. For our non-American friends, Juneteenth (June 19th) commemorates the end of slavery in the United States. While my (and possibly your) intrepid employer has not given us the day off yet, here are 5 ways to celebrate Juneteenth in 2021, including Black-owned brands to support, causes to donate to, and destinations to visit.And speaking of intrepid employers, just Thursday, Amazon committed $150 million to supporting Black-owned businesses
Alright. Stop messing around which one of Amazon's competitors I'm overleveraged in. Let's jump right in.
The one thing to read this week
1) Rory Sutherland: Marketers should see capitalism as a ‘discovery mechanism’ [MarketingWeek]
This is long but very important.
If the whole purpose of marketing is to maximise opportunities, Ogilvy vice-chairman Rory Sutherland believes marketers should resist the urge to chase efficiencies and instead plough their energy into experimentation.
Given the way business culture has shifted to see marketing as a cost, marketers should stop looking at capitalism as a “vehicle for exploitation and ever-increasing efficiency”, and instead look at it as a discovery mechanism.
“That’s the only correct way to actually look at what a business does. It’s a process of discovery, uncovering value that no one knew existed. It’s either discovering an unmet need or servicing an existing need through a previously un-envisaged innovation or idea,” said Sutherland.
“When you think about it there are two ways of adding value in the world. You can either work out what people want and find a really clever way to make it, or you can work out what you can make and find a really clever way to make people want it. The money you make is no different regardless of the direction of travel. In reality, most things are a mixture of the two.”
The value of creating a customer is inordinately higher than the value of identifying a customer, but the distinction is completely lost. Rory Sutherland
The problem now is that marketing is perceived as not being part of the value creation process. For Sutherland, this issue has been compounded by the fact FMCG brands like Unilever and P&G, which inherently believe in the value of marketing, are now below 25% of all ad spend, compared to around 68% in the 1980s.
Today, the advertising “slack” has been taken up by mobile phone network operators, handset manufacturers, broadband providers, insurance comparison websites and cable TV providers. These businesses, he argued, are either dominated by a financial or tech-focused mindset.
“Both those particular mindsets are reductionist, they’re Newtonian, they’re engineering-focused and they focus on efficiency maximisation above everything else. My argument is that marketing fundamentally isn’t an efficiency maximisation game and shouldn’t be allowed to become one,” said Sutherland.
“I know you’re all having tech stacks imposed on you by the rest of the organisation, because they believe marketing should be effectively a cost reduction and efficiency optimisation game. It isn’t and it never should be. It’s an opportunity maximisation game. The whole purpose of marketing is to maximise possible opportunity.”
The lost joy of experimentation
“The point of marketing is to get people who weren’t thinking of buying your product to pay full price for it. The main role of performance marketing, if we’re being cynical, is to get people who would have bought your product anyway to buy it a bit sooner at a discount,” Sutherland stated.
“There’s nothing wrong with doing that. Overcoming inertia is a perfectly reasonable function of advertising and I don’t disparage it. I don’t disparage sales promotion, I don’t disparage discounting, but it’s not the whole game.”
This obsession with optimisation could, he argued, be killing creativity on a mass scale. Sutherland recalled being a creative director in 2007 and assuming the future focus would be on testing a wide variety of creative approaches. However, he believes the industry has failed to do so.
In fact, the shift to digital marketing, which allows brands to fail fast and kill ideas quickly, should have led to marketing becoming “wildly more experimental creatively”, but Sutherland believes this promise has not materialised.
“I think there’s a kind of weird conspiracy between media agencies and tech companies to turn the whole of advertising into a targeting, optimisation incremental improvement game. Google, who don’t have any incentive to say this, say ‘No, the thing that makes the biggest difference is creative experimentation’, and yet we hardly do any of it,” he said.
“I genuinely believe behavioural science, combined with creativity, has a magical power to invest marketing with a real process of efficient discovery.”
If James Dyson had come to me and said: ‘I think there’s a market for an $800 vacuum cleaner’, I would have said ‘I’m not really sure, let’s look at the market’. And if he’d said, ‘Wait, you haven’t heard about my $400 hairdryer’ I’d have had him escorted out of the building as a dangerous lunatic.”
The beauty of experimentation is that it requires a creative leap, something Sutherland believes functions like finance and procurement are fundamentally averse to. He argued finance is focused on both cost and uncertainty reduction, meaning having to ask the “most risk averse people in the organisation” for permission to experiment is counter intuitive.
It is, however, difficult to quantify the impact of lost opportunity and compromised resilience that comes with classifying marketing as short-term efficiency, cost-cutting game, Sutherland added.
“What we’ve done within companies is in functions like procurement and finance we’ve created a monster, because we’ve created siloes within the business which can take the credit for cost reduction, without exposing themselves to any blame or responsibility for lost opportunity and a dangerous loss in resilience,” he said.
“It’s what Nassim Taleb would say ‘They’ve got no skin in the game’. They can claim the credit for any cost savings they make, but they never have to take the blame for the consequences of those cost savings.”
2) Tools for Systems Thinkers: The 6 Fundamental Concepts of Systems Thinking [Leyla Acaroglu - Medium]
I bookmarked this article a few years ago and just rediscovered it. I'm going to give the toppest of top-line summaries but it's really worth reading, bookmarking, and coming back to.
1. Interconnectedness
Systems thinking requires a shift in mindset, away from linear to circular. The fundamental principle of this shift is that everything is interconnected. We talk about interconnectedness not in a spiritual way, but in a biological sciences way.
2. Synthesis
In general, synthesis refers to the combining of two or more things to create something new. When it comes to systems thinking, the goal is synthesis, as opposed to analysis, which is the dissection of complexity into manageable components. Analysis fits into the mechanical and reductionist worldview, where the world is broken down into parts.
Essentially, synthesis is the ability to see interconnectedness.
3. Emergence
From a systems perspective, we know that larger things emerge from smaller parts: emergence is the natural outcome of things coming together. In the most abstract sense, emergence describes the universal concept of how life emerges from individual biological elements in diverse and unique ways.
Emergence is the outcome of the synergies of the parts; it is about non-linearity and self-organization and we often use the term ‘emergence’ to describe the outcome of things interacting together.
4. Feedback Loops
Since everything is interconnected, there are constant feedback loops and flows between elements of a system. We can observe, understand, and intervene in feedback loops once we understand their type and dynamics.
The two main types of feedback loops are reinforcing and balancing. What can be confusing is a reinforcing feedback loop is not usually a good thing. This happens when elements in a system reinforce more of the same, such as population growth or algae growing exponentially in a pond. In reinforcing loops, an abundance of one element can continually refine itself, which often leads to it taking over.
5. Causality
Understanding feedback loops is about gaining perspective of causality: how one thing results in another thing in a dynamic and constantly evolving system (all systems are dynamic and constantly changing in some way; that is the essence of life).
6. Systems Mapping
Systems mapping is one of the key tools of the systems thinker. There are many ways to map, from analog cluster mapping to complex digital feedback analysis. However, the fundamental principles and practices of systems mapping are universal. Identify and map the elements of ‘things’ within a system to understand how they interconnect, relate and act in a complex system, and from here, unique insights and discoveries can be used to develop interventions, shifts, or policy decisions that will dramatically change the system in the most effective way.
3) Byron Sharp on why the best response to Covid-19 was to stop advertising [Campaign Asia]
It's no secret that I have issues with Byron Sharp. For one he's a climate denier. And an asshole about it on Twitter. For another, regardless of what he says, he really only cares about CPG. And last I checked, there's a lot more to buy than packaged goods. And I think he's getting so full of himself that he's starting to fundamentally misunderstand his own work.
He said that it is 'embarrassing arrogance' that marketers would think people were interested in what they had to say about the virus.
It's incredible arrogance of marketers to think that their brand is so important in people's lives that if they send a message about Covid, amongst millions of other messages about Covid, including from chief medical officers, that people would actually want to pay attention to them. It's embarrassing arrogance. We're supposed to be the people who understand consumers and their lives.
Someone has stitched together all the Covid ads on YouTube and it shows that, like so many brand purpose ads, creativity is thrown out the window. Every ad says exactly the same thing: "In these unprecedented times, we're here to help you." It's pretty stupid, because the media was absolutely saturated with Covid stuff.
Coca-Cola in the UK just stopped advertising for a while, understanding that people were thinking about other things at the moment. I think that's a much better thing to do than rushing down to your agency and saying: "We've got to have a Covid ad." When you're a big brand like Coke, going off air for a couple of months isn't going to matter, and when things quieten down a little bit, you can remind them that Coca-Cola is still here
This is where I (Jordan) have to jump in and share my own opinion. Sharp has been one of the loudest voices for brands to continue (or increase) advertising during recessions will come out the strongest. And it was Byron Sharp who championed distinctive brand assets. I don't know how he could so willfully misinterpret his own results. We all agree that Reductio ad Covid-19 was a terrible idea. But to stop advertising? Just keep running what you had! The audacity of the phrase "when you're a big brand like Coke, going off air for a couple of months isn't going to matter, and when things quieten down a little bit, you can remind them that Coca-Cola is still here" really just shows me how out of touch Sharp has become with advertising and his own research. But what do I know? I don't have a PhD. I work for a living.
Interviewer: Your "double jeopardy law" says smaller brands suffer from both lower penetration and lower frequency of purchase. Do you have any practical advice for smaller businesses to escape this trap without the large budgets required to invest in mass-reaching, broadcast advertising?
I want to dispel one myth – people say that double jeopardy means small brands are doomed. It doesn't mean that. Small brands will have a small and less loyal customer base. It doesn't mean they can't grow or won't be around in 10 years' time. But it tells us how they will grow – by winning a lot more customers who will become more loyal and that will be the case because of physical and mental availability.
The great news for a small brand is that you can grow. Whereas I think textbooks in the past tried to tell small businesses they were small because they were too niche or only appealed to a select group of consumers. Usually, that's not the case at all. That's a fantastic positive story. Whereas it's hard for a very big brand to become bigger – you've got all these rivals nibbling at you.
4) Quick Hits
The Anxiety of Influencers [Harpers Magazine] This article is worth a full read it's so good. According to a poll released in 2019, some 54 percent of Americans between the ages of thirteen and thirty-eight would, if given the chance, become a social-media influencer. A whopping 12 percent believed that this term already fit them.
The boys are so eager to assure me of their long-term creative capital. “People don’t realize that this industry is a really big commitment,” one of the influencers, Brandon Westenberg, tells me. “That you’re going to do this like every single day.” At first, I sympathize with his wilting fatigue until I remember that, well, all jobs are something you commit to doing every single day. “It’s exhausting,” he continues. “It doesn’t seem exhausting, like a little fifteen second video, but you gotta think of concepts, and there’s a lot that goes into making videos before you stand up and do it.”
Over Brandon’s shoulder, in a little dining area on the opposite side of the kitchen, the boys keep a whiteboard of their various working ideas. Among them are the following:
hoops challenge
desert video
pranks
skydive
roasts
tuxedos
bath robes
roommates control my day
hide n seek
Call it the Yelpification of the academy. Call it the retail logic of higher education. I mention this only to observe that if we sneer and snicker at influencers’ desperate quest to win approval from their viewers, it might be because they serve as parodic exaggerations of the ways in which we are all forced to bevel the edges of our personalities and become inoffensive brands. It is a logic that extends from the retailer’s smile to the professor’s easy A to the politician’s capitulation to the co-worker’s calculated post to the journalist’s virtue-signaling tweet to the influencer’s scripted photo. The angle of our pose might be different, but all of us bow unfailingly at the altar of the algorithm.
For a moment, I cannot remember who I am or why I am sitting here amid this sea of beautiful young people, all of them desperate for recognition, their whole lives ahead of them, empty at the absolute center. TikTok is a sign of the future, which already feels like a thing of the past. It is the clock counting down our fifteen seconds of fame, the sound the world makes as time is running out.Helicopter startup Blade had phony spokesman for years, CEO admits [New York Post] I'm sorry this is just cuckoo bananas. What?! Blade, which provides chartered jets and choppers to the wealthy, created the fictional PR man Simon McLaren, who gave comments to outlets including the New York Times and Washington Post. CEO Rob Wiesenthal claimed that a lot of growing companies use the tactic because they just don’t have the staff to have a full-time PR rep.
The company even made a Twitter account for McLaren, which described him as a “Jaded New Yorker, raconteur, college dropout writer, student of highly driven narcissists.”“There was no intention of being duplicitous,” Wiesenthal claimed. Mhmm.
5) Department of Great Work
Sipsmith’s Mr Swan mounts takeover bid for Wimbledon [More about Advertising] This ad is extremely British in the best possible way. Ogilvy has produced a diverting effort with Sipsmith’s stop-mo Mr Swan mistakenly announcing that “Wimbledon is The Official Tennis of Sipsmith Gin.” You can add it to Pimm’s too if you want to fall over. Very good. From Ogilvy UK
Droga5 Captures Home Away from Home for The Africa Centre's Juneteenth Campaign [Little Black Book] For The Africa Center, home isn’t just a place -- it’s a feeling. Located in New York City’s iconic Harlem neighborhood, The Africa Centre exists as a cultural bedrock focused on centering African people on the continent and across the Diaspora. Through its programming, the institution amplifies African history, heritage, and global influence, and offers a deeper understanding of contemporary Africa through authentic engagement with African culture and people living in communities across the world.The film is set throughout Harlem to capture sentimental moments that showcase common threads amongst a shared past and ancestry between Africans and those of the African diaspora. It takes :15 or so to get going but it's beautiful. From Droga5
Miller Lite shows baseball fans some glove [The Message] Miller Lite has created a new baseball glove that’s perfect for catching either short hops or tall boys. The limited-edition glove is called the “Miller Lite Relief Catcher.” It’s the perfect answer to that time-honored request, “Hey, toss me a beer,” which takes on new meaning as Canadians start to get together more while still staying apart. “It’s been too long since Canadians have been able to enjoy some Miller time with their friends,” said Katie Rankin, senior marketing manager at Molson Coors, in a release. “The Miller Lite Relief Catcher is the perfect mix of the love for the sport, our great tasting brew [ED Note: Don't push it] and having some safe socially distanced fun during the ball game this year.” From Sid Lee
BBDO Shanghai Demonstrates the effectiveness of Ziploc bags with fresh OOH Campaign [Campaign Brief Asia] BBDO created giant Ziploc bags by transforming light boxes into giant Ziploc bags with real fresh food inside. And to demonstrate the incredibly fresh food the Ziploc bags can deliver, BBDO built a mini vegetable patch inside the displays, soil and all. Smart.
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*5G Ultra Wideband available only in parts of select cities. Global claim from May 2020, based on Opensignal independent analysis of mobile measurements recorded during the period January 31 – April 30, 2020 © 2021 Opensignal Limited.