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John Batistich, Westfield Group, Everything is Broken



Published in Business , Technology
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  • I was fortunate enough to see John present on Everything is Broken last week (as well as a second presentation on the retail space). Amazing presentation!
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  • 1. EVERYTHING IS BROKEN the end of business as usual john batistich
  • 2. “we think that everything is broken & wethrow our computing power at it to fix it”patrick pichete global cfo google
  • 3. “nearly all of the tools, processes &philosophies around marketing weredeveloped more than 50 years ago”
  • 4. “we want a one to one relationship with7 billion customers” bob mcdonald ceo p&g 26 May 2010
  • 5. “we are living through a change in the way ideas are created, spread & implemented. there’s a new model of leading & connecting people with ideas for change” seth godin
  • 6. what we learnt is being disrupted
  • 7. old models don’t work like they used to
  • 8. new methods are being explored
  • 9. rules are being challenged
  • 10. time to think different. think big!
  • 11. what’s changing? 3 shifts
  • 12. demographicincreasing life-spansdeclining fertilityskills shortagecotton wool kidsrise of the screenagerrise in sinks & dinksincreased immigration. higher ethnicityurban-rural polarisationsmaller households power returns east 1 billion new mouths market expansion product sourcing into aus/nz services outsourcing asian values & aesthetics resource competitionsustainability inbound tourism numbers protectionist backlash?environmental changeresource shortages rising costsresource nationalismcarbon economyincreased regulationpeak oilwater labelingpackaging/waste taxeseco-cynicism source: richard watson. picture: john homer
  • 13. 1 accelerator of change
  • 14. technology enabled connectivity 1 billion pcs & 4 billion mobiles location-based services mobile & social payments intelligent vending 3d screens rising transparency & amplification increasing collaboration personalisation acceleration of everything hunger for real shared experiences1. ubiquitous connectivity2. democratisation of production tools3. access to higher data speed/more storage source: richard watson
  • 15. 3 waves of change1. technology2. behavioural change3. business model 26 May 2010
  • 16. “WE ARE LOSING SHARE OF RETAIL”“soon…you won’t forget anything, you’llnever be lost, never lonely, never bored &never out of ideas” eric schmidt ceo google september 2010
  • 17. 1.SHOPPER BEHAVIOURAccelerated change in shopper behaviour challenging old norms
  • 18. old ways new behaviours command & clicks touch & gesture text & 2d video & 3d single task multi-taskdesk/laptop search & email social & mobile search ecommerce mcommerce & social commerce store trading hours shop anytime anywhere national service finds you appointment to view time shifting entertainment & retail merged in a closed loop seasonal sales always on special quality relationships quantity relationships private public
  • 19. 2.THE LINEAR PATHTO PURCHASEThe old linear model is being replaced by a network to advocacysource: psfk
  • 20. old linear path to purchase Sign Up Receive Consult Contact Visit for See an Ad Catalogue Sales Buy Customer Mail or eDM Store Loyalty Person Service cardAwareness Consideration Trial Purchase Repeat
  • 21. add online & social web Get Geo Reorder Follow Stream Compare Create Targeted Review on via Brand on Purchase Online Tags Offer on IPTV Phone Twitter Experience Mobile Post Receive Consult Sign Up for Get up to Review Product Track Catalogue Sales Loyalty the minute Upload Search Purchase Mail or eDM Person card Reviews Picture Join a Ask Contact Visit Read relevant questions See an Ad Buy Customer Store Reviews forum for via live chat Service advice Read a Invite Read Call a 1800 Peruse Sign Up Browse Foursquare Friends to FAQs number Blogger for eDM Content or Yelp Co-Shop Sites Review Scan QR Watch Link from Create Use an Peruse Join Code for YouTube Friend’s A User application Blogger Fan Page Information Video Facebook Community for offers Sites
  • 22. 3. LINEAR DISTRIBUTIONCHANNELSThe future or retail is customer centric & channel agnostic
  • 23. customer chooses multi channels 5% <1% 44% $255B 50% offline search search online total only online offline only retail buy buy sales offline online
  • 24. 4. TRADITIONAL STOREWe crave social, physical and instant experiences. Online experiences are changing store expectations
  • 25. the store needs re-invention. moreexperiential, service, social & integrated
  • 26. 5. DIFFERENTIATION DELUSIONBeing different & better only matters if your customer believes & values it
  • 27. your brand is not as different as you think it is! Is your brand different? % Agree 80% 8% ceo customersource: contagious
  • 28. consumers & businesses differ on why they interact on social sites
  • 29. 6. DISCOUNT DEVOTIONWe are increasingly dependent upon deep discounts training our customers to wait for specials
  • 30. the amount of purchases at discountis at a all time high & many can’t stop
  • 31. 7. OVER CHOICEWe need simpler solutions & more involved experiences
  • 32. in 1997 there were 2 million brandsand now there are 8 million brands more clutter. more confusion
  • 33. in 2008 the average person’s daily intake ofinformation was 300% greater than in 1960university of california san Diego study
  • 34. 8. LOYALTY PROGRAMSToo many complex reward programs with low value creating reward fatigueSource:
  • 35. the world doesn’t need another hard tounderstand low value reward program Spend $15.7K at Coles on FlyBuys or spend $11K at Woolworths to get a $50 voucher
  • 36. 9. DATA DELUGE Making sense of the increasingly available behavioural data is the new goldSource:
  • 37. most marketing departments arenot prepared to make sense ofthe data that is rapidly becomingavailable about their customers
  • 38. 10. LACK OF TESTINGThe world is forever in beta test
  • 39. amazon conducts 200tests a day to improvethe user experience
  • 40. learn fast, cheap, well & first. place lots oflittle bets and scale up the ones that pay off
  • 41. 11. RESEARCH REACH Majority of your audience are out of reach
  • 42. “you only get to talk to about 10% of the populationvia traditional online market research, so what aboutthe other 90%? Who wants their evening interruptedwith a phone call from a research agency” Peter Harris
  • 43. 12. CLAIM BASEDMARKET RESEARCHYou are what you do not what you say
  • 44. we makedecisions onclaimed not actualbehaviour. whocan accurately sayhow often theyhave seen an ad orpurchased aproduct in the last4 weeks?
  • 45. 13. MEDIA AGENCY DEALS Channel agnostic, complete transparency & total accountability
  • 46. media agencies who commit to futureinvestments with media owners beforeunderstanding their clients needs
  • 47. media agencies that get rebates from media owners & don’t disclose them to their clients
  • 48. 14. THE AD AGENCYNew models forming for social, digital, video & mobile channels
  • 49. agency resources measured on inaccuratetime sheets vs value/outputs
  • 50. resourcing digital channels that are more intensive, reiterative & measurableSource:
  • 51. the creative director role will evolvefrom creator to curator because no one person has a mortgage on creativity
  • 52. agencies will collaborate more, shift to projects over campaigns & create ideas that are born to live in beta (social) not built to die (media schedules)
  • 53. 15. EDM INVOLVEMENTVolumes are up but open rates & click through rates are declining
  • 54. why do 79% of members don’t even openyour email? & it’s getting worse!Source: Responsys
  • 55. 16. CPM FOR TV ADVERTISINGYour audience is not as high as you pay for!
  • 56. viewership of ad breaks can be 10%-35% lower than the program you buy 80Source: ikon
  • 57. SO THINK ABOUT…17. YEAR OF THE MOBILEIt’s not the year but the decade of mobile which makes everything local, social & personalised
  • 58. “our coordinates, has the potential tochange all the outputs…where we shop,who we talk to, what we read, what wesearch for, where we go, they all changeonce we merge location and the web”matthew honan wired magazine
  • 59. access reviews, pricing, content,community & buy anytime anywhere
  • 60. mobile payment systemschange the pos & banking
  • 61. 18. ECOMMERCECONVERSIONValue, range & convenience driving online sales but conversion is extremely low
  • 62. different conversion by channel 92% 30% 2% online good store westfield conversion conversion conversion
  • 64. why the high online cart abandonment? 65% <1% online cart store cart abandonment abandonment
  • 65. 20. ACTIVE INVOLVEMENT INSOCIAL NETWORKSToo often, acquisition is the key focus but active involvement has real value
  • 66. why acquisition over involvement & value? 97.4% passive or do nothing at all 2.6% active: like, post or comment
  • 67. how do you get your community active?
  • 68. 22. VALUING A LIKEOR FOLLOWERApply a quality measure to all acquisition & stay agnostic
  • 69. 418% more likely to visit startbuck.comspent 8% more. transacted 11% more frequently are they pre-existing preferences?source: comscore
  • 70. 23. SOCIAL BUSINESS READYMost organisations were not designed for today’s networked world
  • 71. old model new world customer outside customer inside deliver a promise guided by purpose interruption interaction sell & tell loudly actively involve creative & media content & distribution communicate an image deliver an experience one to many one to one & many to many strive for perfection forever beta testing trust through authority trust through transparency
  • 72. 24. CRISIS MANAGEMENTListen, shape & respond with speed & transparency
  • 73. “Consumers havesomething theyhave never hadbefore, the powerto warn &threaten, ratherthan to punishsilently after thefact”bruce philp consumer republic
  • 74. 25. MORE MEETINGSRunning productive meetings will free up capacity to think & create
  • 75. we seek morecollaboration
  • 76. why does the meetingexpands to the time allotted? why not change the time allotted!
  • 77. 26. REFLECTIVE THINKING We are losing the ability to think in a deep, creative ways, which is affecting our decision making
  • 78. “teens were faster than adults atreading online but their attentionspans were much shorter, so anythingdifficult tended to be skipped” jacob nielsen
  • 79. “always on, information overload, multiple-tasking work environments are killingproductivity, attention fragmentation,dampening creativity and making us unhappy”mckinsey report june 2011
  • 80. KEY IMPLICATIONSAsking the right question is the first step for changesource: psfk
  • 81. 1. understand the changes in your customer journey driven by connectivity2. shift your digital gravity towards mobile3. optimise your website for smartphones4. track the engagement of your social communities & identify value5. insist on media transparency & accountability6. review your real tv audience7. focus on activating of your edm databases8. simplify your loyalty program9. review your data analytic capability & tools10. change the focus of your research towards behaviour11. set aside 10% of your budget for testing12. evolve towards a social business design13. run productive meetings. cut meetings by 15 minutes to create 25% more time14. don’t use meaningless words like engagement & activation15. carve out time for reflection & learning16. define26 May 2010 what you need to stop, start & continue to free up capacity to think
  • 82. SOURCESStanding on the shoulders of giants
  • 83. westfield study toursmorgan stanleyellie rogers of ikondr ken hudsondavid whittle of m&c saatchianouk darling of moonmichael batistich of we are socialpeter harris of vision criticaljon bird of ideaworksbest buy slidesharerichard watsonyoutubegoogle & google imagesflickrtechcrunchmumbrellaemarketersmart companyinside retailpsfkmckinsey quarterly june 2011contagious q2 2011
  • 87. EVERYTHING IS BROKEN the end of business as usual john batistich