The Finch and The Fox -- Argentina
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In this Razorfish presention to the IAB / Argentina, titled The Finch and the Fox, Joseph Crump explains the three forces shaping the digital industry in Latin America: The rise of Classe C, the strange power of the telenovela, and the "old media" stranglehold. Crump explains the five "mutations" that need to occur in Argentina in order for the region to achieve its rightful place as a digital leader.
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The Finch and The Fox -- Argentina
- 52. R E S E A R C H Franklin Barbosa D E S I G N Andrew Bouchie C O N T R I B U T O R S Luiz Pimentel, Fernando Gomes, Thomas Rakos, Fernando Madeira, Jose Martinez
Editor's Notes
- Good morning. Thank you so much for coming to see some gringo talk about your country, and your business. And thank you to Bianca and the IAB for having me back again so soon. It’s a huge honor. I hope you will forgive my lack of Spanish. I’m working on it. I am not here today to talk at you, but to have a conversation, and to share a few ideas. I hope we have a really great discussion in just a few minutes.
- So what’s with the crazy title? The finch and the fox. It’s kind of a fairy tale, and to be honest, I’m not sure whether it’s a sad story or a happy story. I think it’s going to depend on you.
- So for the last 7 years I’ve been living in both Manhattan and Rio de Janeiro. Equally crazy cities, but at least you get a tan on one of them. And during my time living in Latin America, I’ve learned that this is a complex part of the planet. It’s a good news / bad news place, I’ve learned. Especially when we start talking about the Internet.
- The bad news: Agencies and brands are completely ignoring this fact. Latin American media buyers and brand managers seem to be stuck in about 2003, from a budget perspective. For Pete’s sake – Sweden is kicking your ass. That’s not right.
- More good news: The Marketing bosses of big brands are beginning to get the digital bug. Simon Clift at Unilever has really set the standard, demanding that his brand managers spend at least 10% of their media budgets online going forward. This is a very good thing.
- Ahh, but back to reality. The CEO of Y&R on Brazil thinks that Latin America is just plain different. TV was, is, and always be the savior.
- But just next door, in the US, we have this happening. This is a really depressing chart is you make TV commercials for a living. For me, it’s pretty exciting.
- But not so fast. This is the total media spend across all media types for 2009. Once again, down at the bottom, Mexico and your neighbors. And look at the TV spend – higher than anywhere in the world.
- This is driving me kind of crazy. On the one hand, we’re the most digital population on Earth. And on the other hand, the people setting up the media budgets don’t seem to realize that. Why is that?
- So believe it or not, once upon a time I thought I wanted to be Jane Goodall. My degree is in anthropology – the study of man and his origins. So I decided to go back to my roots…
- I wanted to see whether it was possible that Latin America was just plain different than the rest of the world. A snowflake. An island unique unto itself.
- So that took me to the cactus finches in the Galapagos Islands. A species of bird that Darwin and lots of evolutionary biologists have spent a lot of time thinking about.
- So these are tiny little birds that are scattered across all the islands of the Galapagos. From island to island they are virtually identical, except for their beaks. Each variation has evolved very different beaks based on their diets. Big beaks for really tough fruits and seeds, little beaks for tiny fruits and seeds. So in 1977 there was a terrible drought in the islands, and all the little fruits and seeds died off – and with it, most of the birds with little and medium sized beaks, who couldn’t break through the tough fruits. So what happened? Scientists were able to watch evolution in action: When the rains returned, the size of the medium-sized beaks had increased 4-5%. In a very short period of time.
- So I would like to suggest, just for now, that everyone in this audience has a tremendous amount in common with the Geospiza Fortis. We are in a digital drought – and we need to evolve. Now.
- There are three things that, I think, are our equivalent of a drought – things that will either kills us off or cause us to get better, stronger, faster. 1 2 3
- About 32 percent of the population of Mexico falls into Classe C. Depending on how you slice the numbers, either the largest or the second-largest population group in the country. And plagued by an incredible number of myths.
- They are the engine of the Mexican economy.
- They are the engine of the digital economy, too.
- For the first time in history, they are buying more computers than televisions. And for extra points, 61% intend to by a Smartphone within the next year.
- It gets even weirder with kids. The average 15-24 year old internet user in Mexico spends 26.6 hours online per month -- more time online than other young internet users anywhere in the world.
- So after Classe C, this is the second major force that is going to cause us finches to change… So…the guilty pleasure of Latin America. The telenovela. Admit it: Who watches them?
- In Brazil, Globo says that with the novelas, they have a Superbowl every night. With such power, incredible things can happen...
- Who remembers Acompañame (“Accompany Me”), from 1976? Acompaname showed in dramatic terms over the course of the nine-month series the personal benefits of family planning. The results of Acompaname, as reported by the Mexican government’s National Population Council were: 1. Contraceptive sales increased 23 percent in one year, compared to a seven percent increase the preceding year. 2. More than 560,000 women enrolled in family planning clinics, an increase of 33 percent (compared to a one percent decrease the previous year). In Mexico, to date, there have been 5 additional social-content soap operas, all developed by Miguel Sabido. They were Vamos Juntos (“We Go Together”), Caminemos (“Let’s Walk”), Nosotros las Mujeres (“We the Women”), Por Amor (“For Love”), and Los Hijos de Nadie (“Nobody’s Children”). During the decade 1977 to 1986, when many of these Mexican soap operas were on the air, the country underwent a 34% decline in its population growth rate . As a result, in May 1986, the United Nations Population Prize was presented to Mexico as the foremost population success story in the world.
- http://www.youtube.com/watch?v=xbHI3QQARAo After one episode of the telenovela Laços de Família , which featured the character Camila crying while her head was shaved in preparation for chemotherapy, prompted 23,000 bone marrow donations in the month after it first aired.
- Soap operas heavily influence the names of children. In a study in Brazil, the likelihood that the 20 most popular names in a certain area include one or more names of characters of a novela aired in that year was 33 percent.
- Cuna de Lobos (Den of wolves) , from 1986 – 1987. Who remembers this one? On the night of the final broadcast, the streets were deserted. Legend has it that María Rubio suffered verbal and physical aggressions from some viewers that couldn’t dissociate the fiction from reality...that obligated her to move to the US.
- Hey I’m not bashing TV. TV is amazing. We all love TV.
- I was hooked on “Caminho das Índias”,” this season’s hit in Brazil. I wish I had a dollar for every time someone said “Namaste” to me during the run of this show.
- I would just like to suggest that its time for Mexican brand managers and agencies to let go of TV just a little bit. And to embrace the medium not of the future, but of today. This is a blog produced by somebody just like you or me – and it got 2,306,682 page views last month.
- So we talked about Classe C. And we talked about Telenovelas and TV. Now I’m going to get to the heart of the matter. If a drought is causing us to evolve, then the Media Stranglehold is the Global Warming that’s causing the drought.
- So I mentioned at the beginning that I’m on a very steep learning curve here in Latin America. Lots of things are confusing, and a few things don’t seem to make any sense at all. But one of the things that become immediately clear when I began looking at how ad agencies make money, is that’s it reminded me of a story I heard when I was a little kid.
- OK, so who here in the audience is on the client side? Well you can guess who you are in this picture. And who is the fox?
- Let’s look at how advertising budgets get spent. Again, think of this as a children’s story. More of a parable than a formula.
- Explain the idea of the BV. So this is not really the agency’s fault. And it’s not the client’s fault. And it’s not Televisa’s fault. It is simply a very old system that is deeply, deeply broken. And the people in this room need to fix it. Clients need to understand that the cost of not paying for strategy is higher than they think – because it guarantees that they will be stuck forever in a television rut. Agencies and publishers need to understand that eventually the light is going to shine on this very shady practice.
- Because I believe in evolution, I am rooting for the finch.
- So don’t know about you, but I’m getting kind of pissed off about all this. Let’s be honest -- this is an IAB meeting, so we’re all finches. We’re outnumbered and worn out and maybe a little defensive. But Darwin says that it’s not the biggest or even the smartest that wins – it’s the one who adapts. So what’s it going to take to adapt?
- So now you really have to pay attention. As finches, this is our job, our challenge, our assignment. Just five things and we can change our world.
- Everything, and I mean everything, starts with education. We have to be relentless and intelligent about educating the marketplace about the power of digital. I’ve been doing this a long time, and I can tell you from experience that the facts are there – you just have to share them. The smart clients will get it.
- So I used to be Executive Creative Director of Razorfish. I understand how powerful awards are – and how much creative people want to win them. But the obsession awards here in Latin America is completely crazy. Clients need to demand more of their creative teams – they need to demand that they produce truly meaningful digital work, for starters.
- Both agencies and clients need to start being honest with each other about the consequences of the way that agencies get compensated. Because the way it is now is extremely suspect, and it’s keeping clients hostage to the television.
- And finally, we need to get beyond banners and silly campaigns. We need to embrace massive trends like the rise of Classe C and social media and the massive influx of Smartphones and hatch ideas that really help transform a brand. We need to think really big.
- So no one is coming to our rescue. In fact, it’s quite the opposite. Pretty much everyone is against us. You guys ARE the cavalry. You are Zorro the hero, not zorro the fox. It’s time to be a hero.
- Or at least an ass-kicking finch.
- So in closing, I wish that I could hypnotize you. Because if I could, I would have you forget everything I’ve said for the last hour and remember only this: This, my friends, is how big your digital media budget should be. At a minimum. If you are not spending 8% or more of your media budget online then you are stuck. You are a Little Beaked Finch. 8% or more. 8% or more. 8% or more.