a new view
DESCRIPTION
Lecture given to an EMBA class over in LONDON from The Chinese University of Hong Kong.TRANSCRIPT
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EMBA London Residence WeekEMBA London Residence Week London, July 1999
Mark BrownBoard Planning Director
Leo Burnett, London
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Advertising & Brand Strategies Towards C21st
• Leo Burnett - who we are
• Preparing for the New Consumer Age
• Preparing for the New Digital Age
• Planning for a New World of Brand Communications
• Case Study: McDonalds
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WHOWE
ARE
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WHOWEARE
Source: Financial World
Helped Build Some of the World’s Most Valuable Brands
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WHOWEARE
Build Strong Brand Relationships
• Our mission is to create deep, enduring relationships between users and brands…
• With daring, fresh, engaging ideas built on human truths….
• To create profitable, long-term growth for your business
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WHOWEARE
Agency Vision
• To be an indispensable source of our clients’ competitive advantage
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WHOWEARE
In short, Blue Chip Roster of 18 Global Full-Service
Clients
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WHOWEARE
Proof of Performance in Successful Partnerships
• Worldwide, over 500 brands ranked #1or #2
• Average client relationship is 16 years, vs. industry average of 5.3 years
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WHOWEARE
We Build Global Icon Brands
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WHOWEARE
1998
$ 6,810
1997 $ 5,980
1996
$ 5,821
1995 $ 5,387
1990
$ 3,585
1985
$ 1,868
1980 $ 635
1970 $ 392
1965 $ 185
1960 $ 117
1955 $ 70
Billings
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SWHERE
WEARE
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WHERE WEARE
88 Offices Around the Globe
A Network that Networks
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WHERE WEARE
North America
•Chicago•Detroit•Los Angeles•Miami•Montreal•New York•Toronto
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WHERE WEARE
Central America• Guatemala City • Managua• Mexico City• Panama City• San Jose• San Juan• San Salvador• Santo Domingo• Tegucigalpa
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WHERE WEARE
South America• Asuncion• Bogota• Buenos Aires• Caracas• Lima• Montevideo• Quito• Santiago• Sao Paulo
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• Amsterdam• Brussels• Copenhagen• Dublin• Frankfurt• Lisbon• London• Madrid• Milan• Oslo• Paris• Stockholm• Zurich
Western Europe
WHERE WEARE
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• Athens• Bratislava• Bucharest• Budapest• Istanbul• Kiev• Moscow• Prague• Riga• Sofia• Tallinn• Vienna• Warsaw• Zagreb
Central and Eastern Europe
WHERE WEARE
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WHERE WEARE
Middle East and Africa• Beirut• Cairo• Damascus• Dubai• Harare• Jeddah• Johannesburg• Kuwait City• Tel Aviv
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WHERE WEARE
• Bangkok• Beijing• Calcutta• Dhaka• New Delhi• Guangzhou• Ho Chi Minh City• Hong Kong• Jakarta• Karachi• Kuala Lumpur• Manila• Mumbai• Seoul• Singapore• Shanghai• Taipei• Tokyo
Asia
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WHERE WEARE
• Adelaide• Brisbane• Melbourne• Sydney• Wellington
Australia
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WHOI
AM
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“Preparing for the New Consumer Age.”
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Life at the end of the 20th Century
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Science Fact NOT Science Fiction...
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Understanding our world today...
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Change
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“When the world changes fundamentally, survival depends on fundamental change.”
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“It’s as if several tornadoes were coming together at once. Individually their force might not be very powerful, but together they are awesome.”
Robert Tucker, Managing the Future
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Consumers are ‘Pulling’ change
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Clients are ‘Pushing’ change
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Technology
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No guarantee of future market dominance...
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Alliance Advantage
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The consumer at the centre of the world
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Privatisationof Risk
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Contradictory consumer
• Consumers are more demanding …. but they are also more ‘satisfied’
• Consumers are more rational and growing more savvy …. but they are also often confused
• Consumers say that they like personal approaches …. but remain suspicious of ‘relationship’ marketing techniques
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The old stereotypes don’t work ...
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Too much choice?
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Everyone is running out of time (% agreeing)
0
10
20
30
40
50
60
70
1991 1993 1995 1997 1998
52% 53%57% 61% 63%
Source: Henley Centre
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Prepared to pay to avoid queuing
Airport check in 26%
Leisure Park 24%
Cinema 19%
Supermarket 18%
Bank branch 11%
Source: Henley Centre/First Direct Time & Money Survey
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Time as currencyTime Pressure
Spend time
Time as currency
Save time Invest time
Value for time
Time deepeninge.g. Driving + making calls +
listening to tape/news + escapism
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Shift in the balance of power...
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RiskAverse
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SNeed for trust brands
Source: The Henley Centre, Planning for Social Change 1998
Personal responsibility
Personal consequences
Trust gap
Loss of trustRiskExplosion in choice
No time No expertise No partners
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Consumer strategies for dealing with overchoice.
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Few of us are confident we will make the right choice
Holiday 56% New car 18%
H’hold electrical goods 40% Life insurance 16%
Car insurance 35% Home computer/PC 16%
Travel ticket 34% Health insurance 14%
Home insurance 28% Mortgage 12%
General banking 22% Investment products 12%
Source: Henley Centre Teleculture Futures
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A market dominated by scares
0
10
20
30
40
50
60
70
'87 '88 '89 '90 '91 '92 '93 '94 '95 '96 '97 '98
I am neversure food issafe to eat
I would paymore for foodwith noadditives
Source: Henley Centre
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Dealing with overchoice
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Dealing with overchoice
“I’m not going to listen (to authorities), I’ll just do whatever I feel”
Disengage
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Dealing with overchoice
“I’m not going to listen (to authorities), I’ll just do whatever I feel”
Disengage
“The whole system is rotten, and we have to replace it”
Alternative Philosophy
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Dealing with overchoice
“I’m not going to listen (to authorities), I’ll just do whatever I feel”
Disengage
“The whole system is rotten, and we have to replace it”
Alternative Philosophy
“If brand X does it, it must be OK”
Prophet Seeking
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Dealing with overchoice
“I’m not going to listen (to authorities), I’ll just do whatever I feel”
Disengage
“The whole system is rotten, and we have to replace it”
Alternative Philosophy
“If brand X does it, it must be OK”
Prophet Seeking
“I just want the facts”
DIY Expert
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Modes serve as guides to consumption
Disengage AlternativePhilosophy
ProphetSeeking
DIY Expert
FoodPhilosophy
Eat whatyou want
There arepoisons inthe food
chain
Stick withbig brands
Readeverything
Brands Big brandsDiscounts
AlternativeBrands
Sainsbury’sKelloggs
Clarkson’scars
Gluck’swine
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Stores can’t meet the demand for organic food
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Decision delegation...
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Prepare for the age of the never satisfied consumer ...
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Empowered consumers ...
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Personal Power @.com
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The dawn of the New Consumer Age
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Real time responsiveness
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No hassle convenience
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Discounting
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“Share what you know. Learn what you don’t. Consumer reporting from actual consumers.”
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Mass customised choice
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Ultra-service
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World-class quality
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Charter of demands for the New Consumer Age
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A growing minority?...
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Unprecedented choice
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Simplification of choice
“One effect of fragmentation of consumer markets is that consumers become paralysed for choice. Faced with a jungle of choices, consumers will return to brands they trust.”
Source: John Naisbitt
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“Brands as signposts ….”
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From Trademarkto Trustmark
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TrustManagement
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Who do you trust?
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Who do you trust to be honest and fair?
64
33
106
3935
31 29
17
0
10
20
30
40
50
60
70
Your d
octo
r
Philips
Sony
Your c
hurc
h
Danon
e
Coca
Cola
McD
onald
s
Curre
nt g
over
nmen
t
Mult
inatio
nals
Source: Henley Centre, Frontiers ‘99 (Eur8)
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The opportunity for brands
Loss of Trust & No Partners
+
Explosion of Choice & No Expertise
+
Personal Responsibility & No Time
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Brand evolution
Brand asproduct
Brand as user image
Brand aspersonality
Brand as organisation
Source: Aaker; Frontiers 98/99
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Future brand evolution
Brand asproduct
Brand as user image
Brand aspersonality
Brand as organisation
Brand as relationship
Brand as life manager
Brand as trust guide
Source: Aaker; Frontiers 98/99
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The consumer at the centre of the world
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Conversationbetween thecustomer andthe brand
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Brands are ideas ...
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Inform, Entertain… SELL
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“A good basic selling idea, involvement and relevancy of course are as important as ever …”
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“…but in the advertising din of today, unless you make yourself noticed and believed, you ain’t got nothin’.”
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“Preparing for the New Creative Age.”
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Impact of technology on advertising communications
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From a monologue to a dialogue world...
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Understand the new digital media...
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Immediacy and impact...
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The fourth era: The Creative Age
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“This is the age of creativity because that’s where new technology wants us to go next.”
John Kao, Jamming
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Exploiting new technology...
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The age of golden opportunity...
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An industry used to change...
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A vision of the future...
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Convergence...
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Information
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Information
Transaction
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Information
Transaction
Communication
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Information
Transaction
Communication
Entertainment
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One core idea of and about the brand...
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Brands will become more powerful in the digital world...
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Velocity in advertising and communications
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Planning for a New world of Brand Communications
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“Markets change faster than marketing…”
Kotler
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C21st
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“The industry will change…”
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“Advertising will only be part of what we do...
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“Change or die…”
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GROWTH
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Four benefits of a strong brand
• 1. Competitive shield
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Four benefits of a strong brand
• 1. Competitive shield
• 2. Elevates the buying decision
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Four benefits of a strong brand
• 1. Competitive shield
• 2. Elevates the buying decision
• 3. Provides a bridge to other markets
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Four benefits of a strong brand
• 1. Competitive shield
• 2. Elevates the buying decision
• 3. Provides a bridge to other markets
• 4. It’s a powerful glue
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Collaboration
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Thinking withinthe framework inwhich problemswere createdcannot solveproblems ….
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A simple common goal...
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InformExciteMotivate SELL
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Open-systems model
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Hard Reality
Giant Step
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Unconfinedby media
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Holisticapproach -everythingcontributes
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HOW WEWORK
Life Brands
The Lab
Innovations
Stars
Leo Direct
Hard Reality
Leo Events
@leoburnett
BRANDLeo Sports
Leo Burnett Advertising
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HOW WEWORK
• The Brand is at the heart of Leo Burnett
• The best way to grow a brand is to have a cross-functional Brand Team managing it
• The Brand Team works with the client to determine the optimum solution for the brand
The Brand Team
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Case Study: McDonalds
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Leo Burnett servicing McDonalds in many areas
Brand advertising
PromotionalAdvertising
PromotionalMerchandise
Event Marketing
Sponsorship
Sports marketing
Product development
Retail planning
Internet
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QUESTIONS?
That’s all folks