Adam Gerhart is the U.S. CEO for Mindshare, a media agency network of more than 7,000 people in 86 countries. Mindshare is part of communications leader WPP.
How would you describe Mindshare?
Our job is to help connect brands to consumers in a meaningful way through the most relevant media and through the most relevant advertising formats.
What does it mean to be meaningful?
We need to be in the spaces, places and mindsets where consumers are most receptive. For us that’s in the context of culture. We have a very codified approach to how we identify cultural moments where consumers are most willing to engage with us as brands and marketers.
Can you walk me through a specific example?
One of our clients is TGI Fridays, the casual dining restaurant. They found out that, unbeknownst to them, the movie Deadpool had two mentions of TGI Fridays. They know that there’s a direct correlation between their product and people that frequent the movies, often on date nights.
We said if there’s any positive mention of TGI Fridays within popular culture, we’re going to draft off of that to create cultural momentum. So from the time that those Deadpool mentions came out, we worked with their internal brand teams, with their food and beverage teams and with their legal teams. We changed the menu so that we had a specific cocktail that referred back to the main character in the film, who is nicknamed “Merc with a Mouth.”
We took one of their previous peach cocktails, renamed it The Mouth, and made it slightly more irreverent with the cultural twist of, “What if The Mouth took over a TGI Friday’s menu?” We put that out into social media. We used influencers to amplify that content and we saw a three percent increase in footfall to the stores versus the same period the year prior. We saw upwards of a 30 percent increase in the sale of that same cocktail just by changing the name and drafting off of popular culture.
Deadpool was famously an R rated movie. How do you balance the risks to the brand?
It absolutely had risks. We will often work with a brand in advance to identify what are the right cultural triggers that align with the brand’s DNA. We will work with their legal team to understand their risk tolerance because in today’s world, things can quickly take a turn and consumer sentiment might change. Because the two mentions in the film were both incredibly positive, we chose to leverage that as an opportunity. Had they been negative, obviously we wouldn’t have activated it in the way that we had. It’s about assessing a tolerance for risk and weighing that against the potential upside of that cultural moment.
What are the tech tools that you use to track social moments and insert yourselves into the conversation?
We are starting to move from understanding consumers based on claimed or reported behavior into observed behavior and ultimately actual behavior. Observed behavior is where we’re starting to move using things like social monitoring tools or social scraping tools. But that only gives us a glimpse of who we think consumers might be. It doesn’t allow us to drill into consumers on a one-to-one basis, to really create those meaningful dialogues that we’ve been talking about. We’re starting to understand consumer behavior to the extent that we can predict it. There are some partners we have started to leverage which have algorithms to predict trending topics before they’re actually scalable.
Understanding and predicting consumer behavior could feel creepy. What is the consumer’s experience if it’s done right?
Understanding consumers and their receptivity to brand messaging needs to yield a better consumer experience all around. It means we need to understand individuals from an opt-in basis, collecting data and information that they are willing to give us in exchange for some sort of value. That can be in the form of an incentive or in the form of more relevant or targeted advertising. Unless they receive something in return for parting with their personal information, it’s kind of all for naught. From a consumer perspective, it means being less intrusive, more relevant and more personalized with the messaging, the placement and what the consumer wants from a brand in the end.
Can this personalized, consensual approach work for any brand?
The dynamics of the industry have changed. This approach is not for a select set of brands. You can be incredibly meaningful and relevant to consumers if you truly understand them.
One of our clients, Unilever, has a number of hair care products. Packaged goods, you can argue, are a low-interest category, more commoditized than most brands or products. They wanted to communicate their range of hair care products, everything from TRESemmé to Dove. We worked to understand key hair care trends before they were peaking like no-‘poo, which stands for no shampoo. We quickly realized there was a way for the brands to be relevant to consumers by offering them style tips and hair care tips that were at the cusp of popular culture.
On a weekly basis, we started turning out a set of creative assets that capitalized on these cutting edge industry trends. We saw a huge uplift in brand consideration and awareness simply because we were talking to consumers in a more relevant way. Being able to understand consumers and creating a meaningful dialog with them can work for any brand, so long as the brand itself, and the agency partners that they are working with, have a true appreciation of how to organically connect with consumers.
How many other folks in your industry understand this?
The question really is: are we as an industry fully embracing the idea of personalization and knowing the consumer deeply? That premise is not new. The adoption of that, however, has yet to be fully embraced by our industry. We’re still a number of years away from agency partners truly understanding that.
As the amount, depth and breadth of data becomes more available, it is unlocking a huge amount of potential to connect with consumers. The more that happens, the more consumers appreciate the change in the industry itself and the faster that will occur. Our mantra for working is what we call Adaptive Marketing – the ability to leverage real-time insights to drive real-time action or decision-making from a media and a marketing standpoint. While getting to those answers is often very complex because of the amount of data that is coming to the forefront, ultimately, the better we can understand that data, the easier our jobs will be.
We will most likely see a steep learning curve across the industry. Those that lean into it, whether it’s agencies or brands, will be far better off as a result.
Havas Media: A Return to What’s Real
Colin Kinsella is CEO of Havas North America. Kinsella likens CES to a modern-day World’s Fair where his clients can learn about what’s possible for their brands.
What is your approach to changing industry?
Media is increasingly structured around data and technology and content and social and performance. To be effective in the marketplace today, you really need to change your structure to be effective for clients. We have changed our structure, putting creative and media along with the units focused on data, innovation, content and social in the same place.
The net result of both creative and media being integrated on behalf of a client is the way forward for the industry. We’re actually physically together, connected in one office, mixed teams and shared P&L. The integration allows us to react faster to the speed of technology and platform development which is driving consumer behavior.
What are the technological changes that have driven the need to do business this way?
Maybe I’d call it digital or I’d call it mobile, but there are so many different ways to connect with a consumer around a product now that require brands to fully consider. In the quest to make sure you’re leaving no stone unturned, you’re really spreading your marketing dollars out very thinly across a wide and broadening ecosystem. As we were doing that, clients started to realize, “This isn’t really working. We’re spending a lot of money, but I’m not seeing a lot of return.”
2016 was one of the first years in quite some time that we saw a big push back into TV. Marketers came back to the realization that TV still works really well. We go on air and clients see business results as early as the next day.
The issue that we’re seeing with technology is that, as humans, we don’t multitask as well as we think we do. You can run a tremendous video campaign online but people don’t talk about it at a dinner party. You run a similar campaign on television and people will talk about it at a dinner party. It permeates society in ways that maybe isn’t as hyper-targeted, but as Procter & Gamble has recently found, maybe we’re all targeting too much. Maybe more broad-stroke creative messaging and media is more effective.
I’m seeing a return of radio. Radio is very efficient, as it’s always been, but they’ve been much more aggressive in pricing. They’ve got new technologies too so you can start buying radio on your own programmatically.
With radio, are you including Spotify and Pandora?
I’m talking about all of it, but the real key is that a lot of buyers for media agencies are in the big cities, and in the big cities, a lot of them just commute (via public transportation) so they don’t listen to radio much. What we’ve been trying to do is tell our planners and strategists, “Don’t think about what you’re doing in your world. You might be very deep with the social, et cetera, but what is the rest of the country doing that has to drive to work?”
Are you talking about the traditional kind of TV broadcast?
I am talking about traditional broadcast. There’s a ton of video in the marketplace, and if you look at the stats, video consumption has increased remarkably. But a lot of that content isn’t as easily advertised against as traditional TV. I think video is the most powerful medium we’ve ever seen. But it doesn’t mean that people remember it as much on digital because of all the other things that they’re multitasking while they’re looking at things digitally.
I realize this is a contrarian view of the marketplace, but it’s a viewpoint that’s been formed from discussions with our clients and insights we’re seeing in the data.
One takeaway could be, “everything old is new again.” How are you looking at TV and radio differently in 2017?
Because data is so much better today, we can buy on the audience level as opposed to buying on the demographic level. The only caveat is that the networks and traditional television is still sold on being able to deliver a guaranteed demo. But we start very narrow now and we build out.
I don’t like to think about big data because it seems too all-encompassing and impossible to work your way through. We tried to find four or five key variables for our clients and concentrate on leveraging those variables. For example, we might look at housing starts and its relationship to mattress sales or housing starts and its relationship to furniture sales, and so we would only advertise heavily in states in which there is huge job growth because there’s huge housing growth.
How do we buy against those households differently than doing a whole national campaign like they used to do? Now we can get much more specific and still be very efficient.
What did you mean by people don’t multitask as well as we may think they do?
There’s a lot of distraction within the viewing experience online. It’s the notion of “I just saw 15 different things in 30 seconds. I don’t remember any of them.” It gets washed over because there’s so much content coming at you that I believe people just don’t remember it. That’s why more traditional forms of media like TV have had a re-emergence, a return to dominance in 2016. Overall, TV viewership is going down and in some ways precipitously down in some demos and on some networks, so we as a media agency have to be very smart about where we put our dollars to get the same type of results.
It sounds like the move to TV is a flight to safety, but that safe island is crumbling a bit and we need to figure out the next thing.
Right. It’s like global warming. The water is going to rise. You just don’t know how fast and how many inches. What is the real effective way to break through that clutter and create a single point-of-view for a brand?
This goes back to our philosophy of integrating experts together within our offices. It can’t simply be an optimized digital video campaign or simply a flight of 30-second spots on television. There needs to be coordination and additional layers that consumers have come to expect with the social, mobile and the creative agency involved. Typically, that coordination has been poor and a lot of messages weren’t as connected as they should have been to really drive brands forward. Havas is leading the next iteration, in which we do everything as a village with media, creative and those other necessary pieces at the core – maybe data at the core with media and creative around it. That is the model going forward that will drive more success for clients.
How does that work?
We have different talent within our organization that know how to go from media to creative – people who know how to go from programmatic algorithms to general media strategy. We’re doing a lot of training on getting our people to do more than one, two or three jobs. Knowing a broader spectrum of how the whole marketing ecosystem fits together, we’ll end up having much smarter, stronger leaders that can use different assets to help clients drive success.
What gets you the most excited about in the next 10 years?
I love that it’s a Rubik’s Cube, and that not every client’s Rubik’s Cube is the same. We have some clients that spend half their money in radio, we have some clients that spend a majority of their money in digital, and they might both be effective. It’s understanding the target incredibly well, pulling in the right data and most importantly the right collaboration of talent so that you can figure out the right media to reach that target to have the intended result.
GroupM: The Search for a Single Source of Truth
Rob Norman is the chief digital officer at GroupM, a media investment group that claims responsibility for “one in three ads globally.”
How would you describe your work?
When I’m feeling fancy, I say that it’s my privilege to spend my life observing what all the disruptors are doing, and it’s my job to determine the impact and opportunities of the disruptors on the disrupted.
What does disruption mean to you? It can be exciting or scary, depending on which side of the equation you’re on.
Almost always both. What it means to me, practically, is that there are a dozen or so companies in the world (along with their regional counterparts) that are impacting the business models of all the other companies in the world. They’re impacting them by creating new distribution channels, or by new routes to market, or by disintermediation, or the creation of marketplaces where they didn’t exist before, or by the production of data, or by the delivery systems of media that impact the vast majority of large enterprises and employers in the world.
When I think about Google and Ford, for example, I think about their relationship at every level, from how people use search to discover two or three dealerships, to how they think about price comparison, right up to what the development of self-driving vehicles means in a macro sense to the transportation industry.
What are the technology developments that help you make better business decisions?
The unicorn in our business is the single source of truth. In our world that’s defined by, “these are customers or prospects we know about, these are the behaviors that we know they do, and these are the actions or events that increase or decrease those behaviors – whatever we’re trying to do.
A common conversation these days is to discuss walled gardens – the data that goes into but doesn’t necessarily come out of a Google or a Facebook or a Snapchat. We also have Google and Facebook dominating the deterministic spaces in terms of device IDs and so forth, and a bunch of others in the probabilistic space who are trying to divine it without necessarily the first-party data that some of the other players have got.
And so what happens is that everyone seems to have their own source of truth. And by definition, if two sources of truth are not the same as one another, there’s not a single source of truth. When you’re in our position, you spend your time looking for the signals of intent or the signals of actual behavior that affect your client, and then work backwards into the platforms and what contact on the platforms is doing to those signals in order to divine that single source of truth. That’s a huge priority for anyone in our business.
Ten years ago, if I asked whether by 2016 we’d have the single source of truth, what would you have said? Looking out 10 years from now, will we solve this problem, or will it get more difficult?
Ten years ago, everyone’s assumption was that we were moving into the area of 100 percent accountability and the solution to the so-called Wanamaker problem of knowing which 50 percent of your advertising worked and hopefully solving an even bigger problem – making 70 or 80, or 90 percent of your advertising work. You would’ve assumed a decade ago that piece would’ve broken out and people would’ve known the answer because common sources of measurement and evaluation and data democratization would’ve solved it.
That hasn’t happened. More and different platforms have evolved with different kinds experiences between advertisers and brands and consumers, and more mechanisms of counting them have evolved, and those mechanisms have not always proved to be as helpful, reliable, or even accurate.
In 10 years’ time I do think it will be somewhat different because more advertisers with their focus on customer data, will start gathering much richer seed data about the actual behaviors of their customers and be able to look at externalities of things they do and be able to infer from those externalities changes in the behavior of customers they do know.
I think it will come from that side of advertisers and the people who work with them like us creating data symmetry inside their businesses, understanding more about their own customers and the triggers, behaviors, and signals that affect those customers, and then applying those external events onto their internal data sources. So the accuracy is going to come more from within than it’s going to come from without.
In 10 years, will we think about GroupM in the same way? Will we think about agencies in the same way?
If I think about the hub of the business as being allocation, optimization and attribution, and the greatest success in that area being delivered around a single source of truth that’s relevant to the advertiser in question, then agencies like GroupM are extremely well resourced and extremely well-positioned to be persistent players in that area.
As a category, we are one of the few enterprises that see all categories of advertising, all types of consumers in all types of geographies, in all types of economic conditions, and we see their behavior across all types of channels. Largely speaking, everyone else has got a single view of the world and of those customers.
So we’ll never know as much about Instagram as Facebook will, and we’ll never know as much about AdWords or YouTube as Google will, but our ability to look at the world and see the combination of effects of YouTube and Instagram is probably better than Google’s or Facebook’s.
What else do you see when looking toward the future?
I think that 2017 isn’t going to see any breakthrough form factors in devices, particularly. It might see the popularization of some kinds of devices – it will be interesting, for example, about where Apple goes in its AR and VR across its device suite, and how Google Daydream evolves, and equally how Samsung evolves into a relationship with Facebook and where Oculus goes, but I don’t see enormous changes in form factors.
It will be intriguing to see if we’ve got future measurable trajectories on Snapchat behaviors as to whether that can be one of the challengers to the so-called hegemonic duopoly of Google and Facebook.
I’m actually interested in something some people might think is mundane: what the medium-term scenario is for over-the-top television. We obviously know about Netflix and Amazon Prime now, but we’re going to see the launch of DirecTV Now from AT&T, Sling is aggressively in the market, Hulu is aggressively in the market, CBS All Access is aggressively in the market. I’m interested in the evolving model of how people choose to have their entertainment delivered to them, and how important different components of it are.
Also, I think the wide scale deployment of 5G is further off than some of the narrative will have you believe.
Omnicom: Machine Learning is the Next Frontier
In 1993, Jonathan Nelson founded internet agency Organic, a company he believes was the fi rst standalone business of the dot-com era. Today, he is the CEO of Omnicom Digital.
How would you describe what you are doing at Omnicom?
My job is to push digital into every corner of all the businesses and clients that we have across the totality of Omnicom.
What did it mean to be on the internet when you founded Organic?
It’s funny because we were talking about it being “online?” I guess it is still online to some extent. Online is just kind of everywhere all the time. So life has changed.
What were you selling at Organic?
We had to write our own web server, which we put in the public domain and called Apache. I literally hand-built the first computer that Apache was on and ran it underneath my desk. Advertising was the model that eventually paid the bills because people wouldn’t pay you to build Apache. They would pay you to build and host their website, which is how I got into the business.
What was the feeling working on the internet at that time?
A combination of exhilaration and fear. We were a very shoestring company, self-funded. There was no ecosystem, so we were half evangelizing and explaining what the internet was. Then half fearful that we were going to crash and burn.
But it was a lot of fun. It was a wide-open space. This is pre-Amazon, Facebook, Google, Uber – all the players that are out today have subsequently built businesses. All those were big white spaces back at that time. You literally could register any domain.
What do you see on the horizon?
We are headed toward something where you’re going to see massive revolutions in existing businesses with innovations like machine learning and e-commerce coming to the fore and restructuring big chunks of the economy. You’re going to see businesses get invented that never existed before and you’re going to see businesses that have existed for a long time, go away. You’re already watching many examples of this.
How do you approach machine learning?
Machine learning is applied to the media buying process. We ask computers what is the most efficient way to buy media. It can be applied to messaging. What is the most efficient message to put in front of somebody?
Machine learning can be applied to the people side of things. What’s the right context? Who is the right consumer? What is the right offer? What is the right commerce experience that they want to have?
Machine learning can be applied to the consumer’s post purchase phase. How do we get somebody, if they have a good experience, to post about it? If they had bad experience, how do we rectify it?
Machine learning is starting to change the nature of computing because it is starting to get so much more anticipatory and insightful.
How does machine learning look at Omnicom specifically?
Basic machine learning is really at the core of what we do at our data and marketing sciences group, Annalect, and our media buying businesses OMD, PHD and Hearts & Science. It is becoming an increasingly important component of our shopper marketing, healthcare and PR businesses. Machine learning is in its early phase; however, it’s touching almost all corners of Omnicom at this point.
Are we finally at the inflexion point where ecommerce achieves a dominance people have predicted?
I guess I take a contrary point of view, which is it’s “only” five or 10 percent of total sales, but that’s up from zero. E-commerce is huge! Go look at the back of a UPS truck every time you see the door open. It’s filled with Amazon boxes. Think of what that’s doing to the economy and how it is shifting an entire class of consumer behavior. Whether you’re booking an airline ticket, buying a book, consuming music or entertainment – we’ve seen a massive restructuring of not only how we use our free time but how we spend our money.
Of course we all go to the grocery store to buy food, at least occasionally. But I’ve never quite understood when people say it’s “only” a small amount. It’s hundreds of billions of dollars, and it’s a global phenomenon. Most places that are heavily penetrated with digital have some form of e-commerce.
What are some of the leading edge things that you’re seeing in e-commerce?
There’s a lot less friction involved in e-commerce. It’s much faster. Things like Amazon Prime have really sped up the whole process of acquiring things.
There’s also machine learning. Think about it in terms of e-commerce. It anticipates what you want. It stack-ranks things in the same way that Google does with Page Rank, but applied to goods and services.
This makes buying things that much more efficient – sorting through many similar products to find the exact one that you want, and then getting it delivered to your home or office in two days with free shipping.
What about a brand that is not stack-ranked in a favorable way? If I’m not a top brand, how do I insert myself into the conversation?
That’s a very interesting question because it’s not just a vector around who sells the most. One of the best features inside of Amazon is the ranks around consumer reviews. As a brand you can really start to affect that by responding to people that didn’t have a favorable experience.
The second thing that you can do is buy ads inside of Amazon. If you want to be up near the top you can buy that media placement.
Smart brands are realizing that it’s not a one-size thing. It’s not just about price. Or it’s not just about brand. It’s a combination of features, brand, price, quality and ratings. It’s a combination of paid and unpaid media – in other words, reviews versus paid. That balance is really how you build a defensible position.
What is something that you believe about the future?
I think about the amount of automation and machine learning, based on data that we are going to see in the next five to 10 years. We have basically unlimited computing power. We have the cloud and we have reams of data coming out of every transaction.
At Omnicom, we are trying to bring that all together in order to be more insightful. We’re already doing this at Annalect and at our newest agency network that emerged from Annalect, Hearts & Science. Hearts & Science launched earlier this year after being awarded P&G’s business and recently went on to win AT&T’s media buying account.
Of course we’re going to see things like virtual reality and enhanced mobile and things like that. The bigger idea here is insights led by data and machine learning.
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