The Conversation Starts From Within

USP

Where’s the Unique Selling Proposition?

ESP

Advertising impact suffering from years of far-fetched promises and exaggerations

It’s increasingly difficult to compensate average, undifferentiated products through remarkable communication

The conversation has to be built into or around the product

Product/service eco advertising advertising

Product/service innovation eco design useful marketing digital technology co-creation advertising advertising

Leading in … digital technology innovation eco co-creation design useful marketing

Leading in innovation Changing the dynamics and conventions of a category Changing expectations and perceptions of a product or service

Changing the dynamics and conventions of a category

Changing expectations and perceptions of a product or service

Advertising : R&D Ratio 3:1 1970 2:1 1995 1.52:1 2005 1.34:1

3:1

1970 2:1

1995 1.52:1

2005 1.34:1

“ Our mantra: innovate, innovate, innovate” “ The single most important thing is that we speed up our innovation machine, which means that we bring more highly appreciated products to the consumer so that they say, ‘ Wow , this is really something I would like to have’”

The actual product experience increasingly becomes the centre of conversation vs.

Remarkable products use advertising as a window display Unremarkable products use advertising as a smokescreen

The more distinctive the offering, the more transparent the communication

The more distinctive the offering, the more transparent the communication

Leading in … digital technology innovation eco co-creation design useful marketing

A new generation of brands built around remarkable new services

“ When it comes to digital technology, because there is a blur and overlap between the product and the experience, where the messaging ends and the product begins is very grey.” Rei Inamoto, AKQA

Digital technology is transforming the interfaces between products & users Airline industry – digital technology is changing every step of the journey Food delivery category – digital technology is changing the ordering and delivery process Banking industry – digital technology is changing the accessibility, availability and flexibility of their services Newspaper industry - digital technology is changing newspapers from paper channel into multimedia product

Airline industry – digital technology is changing every step of the journey

Food delivery category – digital technology is changing the ordering and delivery process

Banking industry – digital technology is changing the accessibility, availability and flexibility of their services

Newspaper industry - digital technology is changing newspapers from paper channel into multimedia product

Airline industry – digital technology is changing every step of the journey

Food delivery category – digital technology is changing the ordering and delivery process

Banking industry – digital technology is changing the accessibility, availability and flexibility of their services

European banks give customers sub-par online service experiences Source: Forrester’s 2007 European Bank Secure Web Site Ranking. Provisional scores Below minimum standards Meets or exceeds minimum standards 0 25 50 75 100

Newspaper industry - digital technology is changing newspapers from paper channel into multimedia product

Leading in … digital technology innovation eco co-creation design useful marketing

“ The single most important competitive advantage will be, as a country or company, the ability to outgreen your competition.” Thomas Friedman

“ The single most important competitive advantage will be, as a country or company, the ability to outgreen your competition.”

Thomas Friedman

Greenwashing or Green Sheen Sin of the Hidden Trade-Off Sin of No Proof Sin of Vagueness Sin of Irrelevance Sin of Fibbing Sin of Lesser of Two Evils

Sin of the Hidden Trade-Off

Sin of No Proof

Sin of Vagueness

Sin of Irrelevance

Sin of Fibbing

Sin of Lesser of Two Evils

Leading in … digital technology innovation eco co-creation design useful marketing

“ At Sony, we assume that all products of our competitors have basically the same technology, price, performance, and features. Design is the only thing that differentiates one product from another in the marketplace.” Nohra Ohga, ex-chariman of Sony

“ At Sony, we assume that all products of our competitors have basically the same technology, price, performance, and features. Design is the only thing that differentiates one product from another in the marketplace.”

Nohra Ohga, ex-chariman of Sony

For the decade ending in December, 2004, the basket of 61 companies in the council's Design Index outperformed the Financial Times Stock Exchange 100 (FTSE100) stock index by more than 200%.

BA created the world's first totally flat airplane bed, drawing back business-class customers, pushing seat yield up 9% and stabilizing BA's rocky share price.

Turning products into collector items

Leading in … digital technology innovation eco co-creation design useful marketing

Increasing involvement from individuals in innovation process Making things requires collaboration The Internet is radically lowering the cost of collaboration Companies are losing their ‘raison d’etre’ Ronald Coase, Nobel Prize winner

Making things requires collaboration

The Internet is radically lowering the cost of collaboration

Companies are losing their ‘raison d’etre’

Crowdsourcing business model – product creation equals marketing

Closed vs. open innovation Sources: Forrester – Innovation Networks, June 17, 2004 Closed Innovation Open Innovation Corporate ethos “ We can do it, we will do it” Best from anywhere Role of customers Passive recipients Active co-innovators Innovation success metrics Increased margins/revenues, reduced time-to-market, market share within existing market R&D ROI, breakthrough product or business models Role of R&D and operations Design, develop and market in-house inventions Optimize performance of owned assets through both in-house and external development; do enough R&D internally to recognize significant external R&D

P&G – Connect and Develop “ In 2000, we decided to stop being Fortress P.& G., and move to an open innovation system that could attract innovations of all stripes from the outside.” A G Lafley, CEO Procter & Gamble

Tcho – Chocolate 2.0 Continuous flavour development based on customer feedback

Leading in … digital technology innovation eco co-creation design useful marketing

What if marketing was less about useless messaging …

… and more about useful services & solutions?

core product or service extended or related services Exploring useful marketing

Advise/guide people… HSBC - The Property Panel Nokia Music Recommenders Blackberry - B-List Top Shop - Style Advisor & Concierge Service

Help people to enjoy or use your product… Apple retail store Bugaboo - Daytrips Nokia - Silence Booth B&Q – DIY book HP – Online Classes

Can become long-term property Can become self-sustaining property The benefits of useful marketing

Can become long-term property

Can become self-sustaining property

Impact of global recession In times of recession, it’s increasingly important to look at marketing as an investment , rather than a cost. Marketing should be more than entertainment, but add actual value to the core offering , and as a result, to people’s lives.

In times of recession, it’s increasingly important to look at marketing as an investment , rather than a cost.

Marketing should be more than entertainment, but add actual value to the core offering , and as a result, to people’s lives.

So what does this all mean for marketing folks?

R&D Marketing Communication Moving away from a sequential approach to R&D and mkt/comms…

R&D Marketing Communication

R&D Marketing Communication … towards a more synchronised and collaborative approach

R&D

Marketing

Communication

And what about agency folks?

Changing the agency model

Tom Himpe www.fckie.com [email_address]