CMO Spotlight on “Beyond Advertising”

 

In this week’s edition of Marketing Matters, Jenny Rooney and Catharine Hays discussed some key tenets of WFoA’s recently published book, Beyond Advertising, with their four guests, Anne-Marie Kline, VP of Global Marketing at Living Proof; John Boris, CMO at Shutterfly; Phil Bienert, CMO and EVP of Digital Commerce at GoDaddy; and Geraldine Calpin, CMO of Hilton Worldwide. As Catharine explained throughout the show, Beyond Advertising identifies the five forces of change that are increasingly impacting our world, asks us to recognize how entrenched mental models can hold us back, and outlines how the future of advertising will be focused on value creation across all touchpoints. A crucial aspect of this future is the triple bottom line: advertising that is valuable for the company, clients, and the global community. As this week’s guests illustrated, the advertising ethos we at WFoA hope will proliferate in the future is very much taking root today.

 

Key Take Aways:

  • Advertising in which a company lauds its own product increasingly holds less traction: today, people want to hear other consumers describe their own experience with the product, letting users create the brand story.
  • Campaigns—which apply a one size fits all strategy—while sometimes useful, often hold less value than more personalized marketing, where authenticity and compatibility with an individual consumer is key.
  • Education, and respectful engagement, are essential to a well-founded relationship between a brand and its vendors.
  • Brands that have an emotional connection as part of their DNA recognize that emotion is all about the right time, the right place, and the right mode of communication.
  • Data is a hugely useful tool for marketing—but must be used carefully, and with respect. Only drawing from self-selected identification is one way to ensure the user remains empowered.
  • Offering a service is great, but providing a full experience is better.
  • Advertising strategies must evolve, particularly if the brand is successfully changing the landscape of its industry. While large scale advertising may be useful to garner brand recognition, more individualized campaigns can help ensure the correct message is being delivered to the target audience.
  • Smaller companies are often at an advantage when changing a marketing strategy, as the siloes are less reified. If all facets of a company are working with a unified and customer-oriented goal in mind, collaboration is inherent.
  • Technology is best used in order to make a consumers’ experience smoother and more personalized, it shouldn’t just be a flashy add-on.
  • Expanding into areas outside a company’s expertise can be risky—much better is to enter partnerships with experts from other fields. Doing so provides the customer with the services they want, while keeping the focus of a brand tight.
  • All the technological swag in the world won’t woo customers if your employees aren’t on board: teach they why something is great for customers over how it functions.

 

* * *

 

Catherine and Jenny first welcomed Anne-Marie Kline, who was named one of Business Insider’s Most Creative Women in Advertising. After working at Digitas for ten years, Kline joined the Living Proof team in 2015. As she explains, when Living Proof was started, its founders “analyzed all hair care products in industry, and realized the only difference was marketing—the active ingredients were all the same.” Living Proof thus set out to do something different: “our products are all founded in scientific research, and go to the root of the problem,” explains Kline. “We solve haircare’s toughest challenges.”

 

Anne-Marie Kline, Vice President of Global Marketing at Living Proof
Anne-Marie Kline, VP Global Marketing, Living Proof Inc.

In an industry where marketing is normally the only distinguisher, how can a company present a genuinely unique product? “A brand can only say ‘we’re great, we’re so great.’ That’s not going to go that far,” explains Kline. “In the beauty space, and hair specifically, you want to have people with your kind of hair that tell you what they did.” Living Proof has thus focused on producing content where consumers or influencers tell their own story or ‘hair journey,’ thus letting the users create the brand story. Kline gave the example of the launch of their dry shampoo, which happened this year. “We had our beauty editors take a Soulcycle class with us, and challenged them to not wash their hair for the day” she explains. “After class, they went on their merry way, on to their date, or next meeting. The results were phenomenal.” The crux, Kline explains, is that they Living Proof isn’t just offering a new product, it is providing a lifestyle change. “People are saving one, or two, or three hours per week in their routines,” she says. “We’ve changed consumer behavior. People don’t need to arrange their workout schedule around when they can wash their hair anymore.”

 

Personal stories are thus central to Living Proof. “When I came to Living Proof it was easy for me to start employing personal as a mentality,” says Kline. “I’m not 100% perfect, we have little campaigns here and there. But our macro view is that we have an ‘always on’ mentality. We’re not building around campaigns, we’re building around asking, ‘how are we authentically part of her life?’”

 

The importance of authenticity carries over into Living Proof’s communication with vendors: rather than just pitching the product, the company focuses on education and learning. This is particularly important because of the scientific quality of their research and products. “We have a program where people come to our HQ in Cambridge to our style lab,” explains Kline. “As part of the program they talk with the scientists—a meeting called Coffee with the Scientist—where they get a condensed version of a talk, dubbed Hair 101, from our head of R&D.” Such an approach sets Living Proof apart from its competitors, because, as Kline explains, “scientists engage the audience with respect, aware that they care and understand what is being talked about. For a long time, other brands didn’t respect the level of interest in the technological aspect of hair care, but because it’s a core part of our business, we want to be sure we are educating people on it.”

 

Next on Marketing Matters, Jenny and Catherine were joined by John Boris, the CMO of Shutterfly. Shutterfly, the leader in personalized product creation, is, as Boris explains, “a mission-driven company. We help people share life’s joy by helping them memorialize and share all the occasions in people’s lives.” Such an approach puts emotion front and center for the brand. “There are very few companies in the world that help you create, share, and give something that makes people smile,” says Boris. “This is so unique to what we do, we are an emotion-focused brand, so you can see how that becomes engrained in our DNA.”

 

CMO of Shutterfly
John Boris, CMO of Shutterfly

This DNA leads the marketing strategy of the brand. “Since we have by our nature an emotional connection, it is critical we build on that,” says Boris. “And not just on our website, but out in broader universe.” At Shutterfly, this is dependent on hitting customers with the right message, at the right time, on the right device. The company has, through its cloud storage and customers’ self-tagging, a huge amount of user data about seminal moments in their lives. “We protect this data above everything else, but use it to reach out and communicate in a meaningful way,” explains Boris. “We can remind our customers if their personal events are coming up, such as an anniversary or a birthday, and offer our services for it.”

 

Further, Shutterfly can target marketing at specific people on specific holidays, for example mother’s day. “We have 30 billion photos stored in our cloud, and we are able to identify who people self-selected as the mothers in their lives,” explains Boris. “So we created three or four personalized gifts, and sent a personalized email saying, ‘we believe these are the mothers in your life, here’s some gifts: we’ve done the work, but you can customize.’” In doing so, Shutterfly not only focused on personalization, but also on ease, giving customers an even more fluid access to a personal, emotive gift. Boris was also aware that drawing on data to create personalization is a delicate balance. “With data, there is always a creepy factor,” he laughs. “We often talk about it, but we don’t believe we cross it. If someone self-selects a person, and the holiday is geared towards that selection, we think it is OK.”

 

The cloud storage Shutterfly offers is also what sets it apart from its other competitors. “What’s unique is not just the creation options,” explains Boris. “We store every photo in our cloud for free, nothing is ever deleted, and we have triple redundancy. And it’s not just storage, it’s intelligent storage that’s device agnostic, creates a timeline, and includes face recognition.” Shutterfly thus offers an experience, not just a service. As Boris puts it, “people can engage with their photos and know they’re in a place that is safe and secure. And then we overlay smart creation on top of that.”

 

Jenny and Catharine’s next guest, Phil Bienert, is the CMO and EVP of Digital Commerce at GoDaddy, a company that helps helps the world easily start, confidently grow, and successfully run an online presence. “We are dedicated to the success of small businesses around the world that are underserved by big players out there,” explains Beinert. “We help them do something critically important: establishing a digital ID and getting themselves online. In 2016, any business, including the Mom and Pop store down the street, will fail if they don’t have a digital identity. It’s essential to having a successful business.”

 

CMO and Executive Vice President of Digital Commerce at GoDaddy
Phil Bienert, CMO and Executive Vice President of Digital Commerce at GoDaddy

GoDaddy has been well-known for its Superbowl advertising, which was key to building brand awareness—today GoDaddy has 80 percent brand recognition domestically. But things have changed dramatically in the last 10 years, and GoDaddy’s marketing strategy has changed with it. “Buying a domain name 10 years ago was not an easy thing,” explains Bienert. “If you think about whose buying those products at the time, it was primarily IT people. The Superbowl advertising was therefore intended to appeal to a specific audience of people.” Today, however, buying a domain name is a simple process—in large part thanks to GoDaddy. “We made some pretty radical changes to what it takes to buy a domain and what it costs,” Bienert says. “Today people buy domain names via a search, and it costs 10 or 12 dollars. We changed the process in order to democratize a big part of the internet.”

 

Through this democratization, small businesses are able to buy, and manage, web space far more easily. “We wanted to drop the prices to make it achievable for small businesses to do these things themselves, because that is what is important to us” explains Bienert. “The ease of use was what GoDaddy brought to the market place, and we’ve evolved our advertising because of it,” he says. In the past three- to- four years, GoDaddy has focused on messaging around what they can do for small businesses. “We’ve evolved the brand while changing a big component of the internet, and so now we’re in a position where we can evolve our messaging to reflect more what we do.”

 

Recently, then, brand awareness has been less the focus than clear and direct messaging to those who could benefit from GoDaddy’s expertise. “In the last couple of years, our message much more directly connects with customers,” says Bienert. “We want them to understand that we know what it takes to be a small business and that we’re there for them.” Television marketing is still part of the GoDaddy approach, but more and more, digital touchpoints are the focus. “Through digital touchpoints, where focus our marketing efforts around content that is relevant and contextual, we’re finding that we can frankly create a dialog that’s helpful and useful for customers, and efficient for us from a marketing perspective,” he explains. “We can have a relevant message that is helpful, engaging, and will help them do business with us.”

 

Internally, such a shift in marketing approach was easier because GoDaddy is a smaller company, and silos between areas of expertise are less reified. “We’ve made a significant amount of progress in a small amount of time because we’re small and lean, and in a smaller company you have an easier time focusing on the end result,” explains Bienert. “We were able to make a pivot into marketing that is a lot about content and context in less than a year because we took advantage of the fact that we’re smaller.” Bienert noted that the collaboration between himself—the CMO—and the CIO was successful because, as he explains, “there is no disagreement around what we want to do for our customers—make them successful.” With this in mind, debates over who should fund what fall to the background. “It’s all GoDaddy money, and GoDaddy is here for customers,” says Bienert. “It is amazing how quickly things can happen if you have that operating philosophy.”

 

To conclude this week’s show, Catharine and Jenny spoke to Geraldine Calpin, CMO at Hilton Worldwide. Hilton, the most famous hotel brand in the world, is constantly developing and fine tuning its marketing strategy, “moving,” as Calpin puts it, “from a monolog to a dialog with our guests.” There are four facets Hilton is focused on, “how to improve guest experience by making their travel and stay easier; creating value as a brand—developing services and products that our guests want or will want tomorrow; putting the customer at the heart of our brand; and customization: rather than talking to segments, to groups of people, you can talk to everyone—truly one on one,” explains Calpin.

 

CMO of Hilton
Geraldine Calpin, CMO of Hilton

Calpin, who moved from the head of digital to her current position, sees technology as particularly crucial to this increasingly personalized interaction with guests. “We have a strategy to use technology to deliver even better customer experience and better hospitality for those that want to engage with us that way,” she explains. Using the Hilton app, guests can communicate that there is a problem, and will get a response in five minutes. Hilton Honors members can also use the app to select the precise room they would like to stay in, in much the same way airline passengers can select a seat. This service, Calpin explains, “has had huge customer adoption, and is beloved by our guests. Having that heartfelt emotion and huge adoption really makes a huge difference.” The next phase of the app, already available at several hundred hotels, is a feature Calpin is excited about. “You can check in the day before, and use the map to choose the room you want, she explains. “And then when you get to the hotel, you can use your mobile phone as your room key—so you can use your phone to go straight to your room.”

 

Technology is also an avenue through which Hilton is building partnerships with other companies, and thus providing even more value and customization for its guests. Through a partnership with Uber, guests can order cars straight through the app, which inputs the hotel address automatically. “While we’re not in the taxi business, if our guests want to use Uber, we thought let’s make it easy for them,” explains Calpin. Likewise, the Conrad 135 function—which suggests one, three, and five hour itineraries to explore a city, can be accessed through the app. “Offering services with content partners, rather than doing it ourselves, is rally strategically important,” she says. It makes sense both from a traditional point of view and in order to deliver greater value and improve the experience.”

But of course, technology isn’t the only facet important to guests—Hilton is a hotel, where you are greeted by and interact with humans, after all. “We have hundreds of thousands of team members, and engaging then in this journey has been a core part of our success,” says Calpin. “Making sure that our team members are enthused and excited about what we’re doing is crucial. They are the ambassadors, and at the end of the day, they’re the people who smile at you when you arrive at the hotel.”

To foster a sense of enthusiasm and engagement, Calpin, like Kline and Living Proof, see education and communication as crucial. “I spend less time telling staff how a new digital development works, and more time explaining why we have it, and why they should care,” explains Calpin. “We don’t just send a mass email to announce that we’re about to launch a product, we aim to engage the village so that they are excited.” Such engagement includes interactive launches and staff competitions. “It is so important,” insists Calpin, “to engage rather than bore.” As the research included in Beyond Advertising shows, authenticity is key: a lesson that Hilton, as it carefully adapts to the increasingly digital world, applies to customers and employees both.

You can listen to this show and past shows on our radio show page: http://wfoa.wharton.upenn.edu/research-initiatives/radio-show/

Getting Creative with Content

On this week’s Marketing Matters, Executive Director Catharine Hays and Forbes CMO Network Editor Jenny Rooney welcomed guests to discuss the changing world of content creation. Defining, and harnessing, the possibilities of content in the digital age is a challenge that requires abandoning old mental models, and understanding what content is—and can do—in a whole new way.

* * *

Catharine and Jenny first welcomed Omar Akhtar, Managing Editor at Altimeter Group, a company that, as Akhtar explains, “publishes research that helps companies deal with digital disruption.” Most recently, Akhtar, with co-author Mat Zucker, produced a report titled Key Elements for Building a Content Strategy, which usefully distinguishes between content marketing and content strategy. “Companies have always been creating content, they produce content just by virtue of being a company,” explains Akhtar. “But content marketing is all about the delivery of material and the audience, whereas content strategy is all about what you want that content to achieve for your organization as a whole.” Importantly, then, a content strategy doesn’t just develop or apply to the marketing department: “You don’t want the brand to be different from the marketing, and sales, and other departments, you want a unified experience,” explains Akhtar. “And that really is the toughest part of a modern content producing business unit, working out how we are going to produce a blueprint that everybody can get on board with, how can we produce one truth about the customer that everyone agrees with.”

 

Omar Akhtar, Managing Editor of Altimeter Group
Omar Akhtar, Managing Editor of Altimeter Group

Akhtar and Zucker’s report propose five ‘content archetypes’ drawn from real-world situations. “The controversial part is that you can only pick one of the archetypes to focus on,” explains Akhtar. “Of course I recognize that most companies can’t pick one, but when you’re coming up with a strategy, picking one operates as a forcing mechanism to help prioritize exactly what content is going to be most beneficial for your customer, and what you can deliver on.” The five archetypes, as outlined on the Altimeter Website, are:

 

  • Content as Presence:Engaging, entertaining and educational content that serves to establish awareness, health and equity for a brand.
  • Content as Currency:High quality, unique content that helps the customer achieve expertise in a personal or professional aspect of their lives, and as a result consider the brand producing it as an expert, trusted resource.
  • Content as a Window:Content that serves to build trust and loyalty by highlighting the brand’s practices, ethics and values.
  • Content as Community:Content that serves a platform where a niche community for a shared interest, lifestyle or hobby interacts and exchanges peer knowledge.
  • Content as Support:Educational, service-oriented or product-focused content that gives customers consistent, easily accessible knowledge about items they have purchased and how to use them.

 

An example of Content as Presence would be Taco Bell, a household name that won’t dramatically innovate its product. “So,” explains Akhtar, “the way Taco Bell can stay relevant in people’s lives is by being relevant through content. Look at the company’s social media: it’s funny, engaging, and works to maintain the brand health at a level it needs to be.” Content as Presence also makes sense for start-ups who want to punch above their weight: “Content as Presence is about scale more than anything else, about getting a lot of eyeballs to see your brand,” he explains.

 

Content as Currency is exemplified by Altimeter itself. In this archetype, scarcity of content is crucial. As Akhtar explains, “Content as Currency is very effective in helping you look like a subject matter expert on something, but you have to deliver on that promise.” Content as a Window looks back into a brand, and “is really great for companies that want to promote trust, transparency, customer loyalty,” he says. “A really great example is Piedmont Healthcare, a hospital. Patients might want to know about a procedure before they enroll, so they showcase patient stories about transplants and donations in order to help customers overcome their fears. It’s really effective at promoting values around transparency and trust.”

 

In explaining Content as Community, Akhtar chose REI as an example. “In this case, you’re creating content for a community of very enthusiastic, niche audiences, they do the heavy lifting of content creation,” explains Akhtar. “What REI does is facilitate the conversation between outdoor enthusiasts while it acts as just another content creator in that community.” Finally, Content as Support can be seen in the case of GM, who, after listening to customer feedback, decided to focus on spec sheets. “They decided that this is the thing that is going to help the customer most, and they’ve got so much engagement coming back because it’s such unified content,” explains Akhtar. “The spec sheet is going to be the same from one dealership to another, and will get the info to the consumer very quickly because that’s what they want to know.”

 

Importantly, while Akhtar and Zucker’s report suggests focusing on one archetype, a company is not tied to their choice indefinitely. “You can utilize these concept archetypes at different stages in your company’s life,” explains Akhtar. “You might want to start with Content as Presence when you’re announcing yourself, and as your company becomes more well-known or is handling a crisis, you might want to turn the camera inwards. Content strategies are fluid, but the important thing is that they come from the top and create some sort of identity for what you want to achieve: that’s what makes it easier to measure success.”

 

Next up on Marketing Matters, Catharine and Jenny welcomed Rusty Shelton, Founder and CEO of Shelton Interactive, and co-author, with Barbara Cave Hendricks, of Mastering the New Media Landscape: Embrace the Micromedia Mindset (2016). “When Barb and I linked up, we recognized that what was working well in digital wasn’t working nearly as well unless we brought a more traditional mindset to the table,” explains Shelton. “We called this embracing the micromedia mindset, this idea that to succeed in today’s media environment, you have to think more like a media executive than a marketer.”

 

Rusty Shelton, Founder and CEO of Shelton Interactive
Rusty Shelton, Founder and CEO of Shelton Interactive

The micromedia age is, according to Shelton, upon us. “In this age, every individual and brand, whether they know it or not, is a media outlet. Everyone listening to this interview right now, whether they know it or not, is a media outlet. Whether they influence 100 people on Facebook, or via an email list, of 10,000 people via a podcast—everyone is a media outlet.” Building an audience to tap into these media outlets is thus crucial to growing any business.

 

For Shelton, there are three buckets of media—owned, earned, and rented. “We define owned media as all channels where you fully control the connection to your audience,” explains Shelton. “So a website, your blog, your email list, your physical mailing list. Owned media enables you to get to your audience no matter how many algorithm changes Facebook has, and no matter if the editor at the New York Times or producer at NPR says yes.” Rented media indicates less control—not over content, but over audience. “Rented media includes all social media and all ads, and there’s a low barrier to entry,” explains Shelton “The challenge is we don’t fully own that stage.” So, should the algorithmic distribution of a platform change, your audience will change without your consent. Finally, earned media, says Shelton, “includes all speaking engagements, publicity, and also includes customer reviews and shout outs: it’s essentially all the media that you can’t automatically get—there’s a very high barrier to entry.”

 

Of these three types of media, owned is the most valuable in this day and age. “Owned media is, in many ways, like your own auditorium, it’s giving content from the stage in an auditorium you control,” explains Shelton. “But an interview with NPR is like being invited onto the stage in their auditorium for a few minutes. Whether you’re getting your message out on rented media or earned media, the big picture goal is not to reach that auditorium for those few minutes, it’s to make such an impression that as many people as possible follow you out the door of that auditorium and into your own. Once they make it to your auditorium—say, your website—we give them a reason to sit down.”

 

Shelton illustrated his point using the publication of The Confidence Code, by Katty Kay and Claire Shipman, a book about the confidence gap between men and women. While Kay and Shipman had been working in media for years, and were thus guaranteed media coverage, the duo did not have owned media in place. “One of the goals of the campaign was to grow an email list, to build an audience that Katty and Claire could use for years to come: to establish an auditorium,” says Shelton. “So we set up a website featuring the confidence quiz. Our idea was that around every interview Katty and Claire did, this quiz could be the call to action in addition to the book. So, when Katty and Claire were on someone else’s stage, they were able to mention ‘hey if you’re curious how confident you are, head to confidencecode.com and take the quiz and find out.’” Since the publication of The Confidence Code, over 160,000 people have taken the quiz—and thus taken a seat in The Confidence Code auditorium.

 

To conclude, Shelton advocated the value of sharing your auditorium. He suggests treating owned media—for example a blog—like a newspaper: and you never read a newspaper filled solely with op-eds. “The op-ed approach works well when you’re known, when your auditorium is already full, but when you’re just getting started, the best way to get people in the door is to involve as many other people as you can,” explains Shelton. “Bring other experts and other authorities in your industry in to interview, showcase their work, get their perspective. Share your auditorium.”

 

Catharine and Jenny’s next guest was Rick Ducey, managing director of BIA/Kelsey, a company that completes market intelligence research, surveys, and analysis, with a focus on local advertising. “The part of the market we focus on is that location-based connection between brands and consumers,” explains Ducey. But today, local has a very different meaning from decades ago, when local advertising meant physically local—a local brand advertising in the local newspaper, or on the local TV or radio. “But in the digital world,” explains Ducey, “the roles have changed. With the tech and data that is becoming increasingly accessible, people are making different marketing decisions.” Local is now closely entwined with digital capabilities: “local has gone from local businesses and local media companies selling to local audiences, to the localness of audiences being really valuable in terms of advertising message, content, context, and where that consumer is in that journey to purchase.”

 

Rick Ducey, Managing Director of BIA/Kelsey
Rick Ducey, Managing Director of BIA/Kelsey

Ducey uses Hulu and Pandora as examples, explaining that, via geotagging information, advertising can be adapted depending on where the customer is. “Essentially, we walk around with cell phones that broadcast who we are, where we are, where we’ve been, and where we’re likely to be going,” he says. “That’s incredibly valuable set of signals to build consumer graphs. So companies are working to develop products and services for the advertising community to capitalize on that.” These products and services are being called Martech, the blending of marketing and technology.

 

Martech is enabling local advertising on a detailed and personal scale, something that, until now, was cost and time prohibitive. “The issue historically is that local advertising is hard to plan, execute, and evaluate,” says Ducey. “If you’re a national brand and you have the one national campaign, you plan it, and you can go play golf, so to speak. But if you want to do it local ads, you may have 210 different markets with five different creative executions per market. That’s near a thousand campaigns to manage, so you’re going to have to work through memorial day weekend!” Technology is, however, changing this. “A simple business rule, created by the brand manager who ties consumer behavior to their marketing execution, can be applied, and machine intelligence can produce thousands of creative executions that follow the rule that was set,” explains Ducey. “So say anywhere where the temperature is above 80 degrees, Wendy’s sell more softies. The brand manager can set up a rule: wherever we have a Wendy’s where the temperature is 80 degrees or higher, we’ll serve creative ads that offer customers a free softie.”

 

But Martech is not just a utility for national brands, it is increasingly being adapted for small- and medium-sized businesses. “There’s somewhere between 28 million to 35 million small- and medium-sized businesses in the country,” says Ducey. “They account for over half of all US sales. They also account for over half of all jobs, and about two-thirds of all new jobs. So I like to say small business is big.” And this year, these businesses are predicted to spend $52 billion on marketing. Now, as Martech evolves, becoming increasingly user friendly, these businesses are engaging with the technology. “These small mom and pop shops can now use marketing technology to ask, ‘how do I use my customer info to make better decisions about inventory I want to carry, which media and advertising platforms do I want to use, which marketing messages resonate w my consumers?,’” explains Ducey. “Businesses want to know how to retain customers, how to recruit customers, and how to know they’re doing that successfully. The job of Martech is to make marketers smarter about their customers by making data more accessible, allowing them to act on that data, and allowing them to accomplish those business objectives, whatever they are”

 

Of course, crucial to Martech is strategy: data and machine learning cannot do it all. “The technology needs to be married to a strategy and a commitment, the technology itself won’t solve problems, but it certainly enables really powerful solutions,” explains Ducey. “At the beginning of the day, you want to have an awesome customer experience that is connected to your brand, you want to bring people back, and have them tell their friends, hey, this is cool you should try it.” Martech is helping companies big and small more successfully deliver on excellent customer service.

 

Gareth Kay, Co-founder of Chapter SF
Gareth Kay, Co-founder of Chapter SF

To close this edition of the show, Jenny and Catharine welcomed Gareth Kay, Co-founder of Chapter SF, and an early collaborator on WFoA’s book, Beyond Advertising. Chapter SF just passed its two-year mark, which, Kay says, “is a big gate-way for a small company to get through—it’s been quite a ride so far.” Chapter SF, a company committed to simple principles, openness, and rapid iteration, was born out of the recognition that clients were approaching ad agencies, digital agencies, or media companies to ask for a specific piece of branding, rather than asking for help with the bigger picture. “They weren’t saying, ‘I’ve got this commercial problem and I need to apply some creativity to help solve it; I don’t quite know what that output is going to be, but I know I have to see a different outcome out there in the market place,’” explains Kay. “So we tried to really build a company that is obsessed by the outcome we created for our clients, rather than the output we made. Chapter SF was built on opportunities we saw based on our past experiences, but more importantly, it was born out of optimism for what creativity can really deliver nowadays.”

 

This break from the more traditional approach to advertising—ad first, problem later—is emphasized by the network model embraced by Chapter SF. “Within the industry, there was a real desire, both from muscle memory and for economic reasons, to make sure you had all the talent under one roof, because at the end of the day you were selling talent to clients,” explains Kay. “Our appreciation for a network model came from looking at places like the Hollywood—how they make films—and looking at how software’s developed, and at platforms like Reddit and Facebook and Kickstarter. What’s so vital is that they’re connecting different people at different times of the process to make something that one person alone could not make.” Rather than aspiring to have everyone, fulltime, under one roof, Kay and his other co-founders decided to create a backbone of ‘architects’—a mixture of designers, strategists, writers, and producers, and then, as Kay puts it, “plug in talent depending on what the problem we’re trying to solve, at the right time. This means we can build a really specific team for a client’s problem, and bring the right team to bear on the problem at the right time.”

 

Such an approach enables scalability, and Kay says, ensures clients gain access to the greatest talent available. It also engages with the growing trend of freelance workers in San Francisco, who have a better work/life balance through such a working model. But of course challenging the mental model of what an agency should look like does at times take some convincing: “For some clients it becomes a little bit concerning because they like to have that talent on the payroll under one roof, and they can get a little bit nervous about the promise that we’re going to bring someone into play, without seeing that talent inside the building day in day out,” explains Kay. “But the number of clients who feel that way is decreasing rapidly. It’s a matter of being good at talent management, being good at building partnerships and relationships, and making sure that individuals and companies get the credit that they deserve—that’s the most critical thing in the whole model.”

 

Kay is also the author of an essay on why small matters in advertising. “The key point is that big problems don’t need big solutions,” he explains. “Inside organizations, when you start talking about big problems and big ideas and big solutions, you have a big target on your back because they sound scary and dangerous. This leads to ideas moving very slowly, or in worst cases dying.” By keeping things small—and recognizing that really small changes can have really big effects—problems can be tackled quickly, and creatively. Kay sites a TED talk by Rory Sutherland, who outlined the problem of patients failing to complete a course of medication. “Sutherland outlined how, rather than asking patients to take tablets for 20 days, you could chunk up the prescription,” explains Kay. “Tell a patient to take the yellow tablet for ten days, and then the red tablet for the next 10 days. It’s the same medication, but just by changing the color of pills, there’s a much higher likelihood for the course to be finished. It’s a very small, some people may say superficial thing to do, but it has a dramatic impact on human behavior.” By tackling small problems with a diverse and networked group of people, solutions are more effective, relevant, and more creative.