Mark Di Somma - Upheavals

Understanding the five threats

Mark Di Somma — Wednesday, 4 November 2009

Here�s some great insights for anyone involved in change programmes of any kind. According to this article in Reuters, the key to successfully transforming organisations lies in better understanding what people feel threatened by.

A key insight from a guy called David Rock is that �People are not rational, they are social�. According to him, what we�re told is not the fundamental driver for acceptance. The key issue is that we are intuitively programmed to respond positively to social rewards, and are instinctually committed to minimising social threats.

Perceived threats to any or all of five key areas will cause us to act defensively towards an event or an idea. Those areas are: status; certainty; autonomy; relatedness; and fairness. Threats in any of these areas cause us to close off the energy being passed through our prefrontal cortex, the home of conscious thinking in the bank. Productivity falls, and so does job satisfaction.

Which is pretty radical when you think about it, because most change programmes I�ve been involved with actively attack all five of those concerns almost without thinking.

And that�s just the point. People haven�t thought about it. So - if you�re driving through a change programme right now, what can you do to make sure that the messages you�re circulating address those five key areas of concern positively? Or at least as positively as possible.

That�s not a reason to just spin yarns. They won�t help at all. But it�s five very good reasons to behave with sensitivity and grace.

How many complaints does it take to make a change?

Mark Di Somma — Tuesday, 27 October 2009

The saga with the cereal maker continues. Seems that simply finding one large fly in a box of cereal is not enough to warrant anything as drastic as a recall. They are taking it seriously apparently - or at least that�s what they told my wife - but they�d have to receive more complaints before taking this further.

Not sure yet whether this is a quantity thing or a size thing.

Perhaps a fly - even a big fly - just isn�t big enough. Perhaps they have to find something more substantial. (Would a wallaby be big enough do you think? Or a Hector�s dolphin? Or a truck and trailor unit?)

So I�ve got questions now. Questions like - why does it take more than one complaint to help validate the original complaint? What does that suggest about how the company deals with one-off complaints? How many complaints do they actually get that they don�t act on because of this? And just how many flies or other abnormalities are allowed into a batch before this company considers the situation abnormal? Would they act if they got one more complaint? Or would 30 other people have to complain before the matter was considered serious?

And what does this tell you about the hygiene standards of a company whose food most New Zealanders ingest on a regular basis? Do they review their procedures when they receive a complaint like this? Or do they just carry on, business as usual?

The reason I have to ask is because the company hasn�t addressed any of these matters yet. The very nice lady my wife spoke to asked her to put the beastie in a bag and post it to them. (Which also seems a little strange - because what state do you think a semi-thawed fly is going to be in by the time it gets to the company through the post?)

This is a significant brand. The fact that they don�t have a 24 hour monitor for crises (even a mobile) and seem to have a defensive attitude towards a complaint that I would have thought had the potential to strike at the very heart of their brand promise - safe food the whole family can eat - seems very strange.

What seems to have been missed here is that a fly in food is not a quantity matter. It�s a quality issue. Even if it only happens once. Even more importantly it�s a trust issue. And what�s more important to any brand, especially a food brand, than trust?

As my wife pointed out, if a fly that big can get into the manufacturing process, what else can get in? Or has got in? Or is still getting in?

We may never know, you see - if enough people don�t complain.

I don�t know about you, but I don�t find that situation very reassuring.

Cereal killer

Mark Di Somma — Sunday, 25 October 2009

My wife found a fly in her cereal this morning. It was a big fly. About the same size as the generous berries that the cereal is meant to be packed with. Except this �berry� was black. With wings. And judging by the look of it, it had been a passenger in the manufacturing journey for some time.

(Fortunately my wife saw it before she tasted it.)

Of course, in these circumstances, one�s mind quickly turns to legal matters. Not knowing the calorific content of the creature, I can�t comment on whether its inclusion would have affected the advertised low fat content. So, not sure if we have an infringement of the Fair Trading Act here, although it certainly introduced an element of repulsion which I noted wasn�t included in the list of ingredients.

And we can�t tell where the fly might have come from, so thank goodness, this country doesn�t have compulsory country of origin labelling. Because �out of thin air� hardly constitutes a recognised national territory.

Seriously though, when she rang the company�s 0800 number, my wife got an answer machine - which disappointed her more than a little. Because as she rightly pointed out, flies and any other intrusions cannot be trusted to turn up in packets of breakfast food during business hours.

Be interesting to see how the company responds.

Will they ring and apologise? Or, in a variation of the Parrot Sketch, will this be one of those situations where someone acknowledges that my wife has registered a complaint and then suggests that the animal was just resting and could in fact have been pining for a fiord?

(In case they want to check the plumage, the creature�s on ice in a bag in the deep freeze.)

Needless to say, we�re converting to toast.

The new social status? Or - what difference does soup make?

Mark Di Somma — Thursday, 22 October 2009

If your senior managers are struggling to see the connection between what you support and what you earn, direct them to this great article on the influence of cause on shopping decisions.

According to a survey of 6,000 people in 10 countries, 83% of consumers say they are willing to change their consumption habits if it helps make the world a better place to live, and 68% feel it's becoming unacceptable not to make efforts to show concern for the environment or live a healthy lifestyle. 64% said they expect companies to support causes.

In some ways, there�s no news here. The better you make people feel, the more likely they are to buy from you. The news is in how much cause has become a key feel-good factor.

I really liked this point: "Social purpose is the new social status," according to Mitch Markson, Edelman's chief creative officer. "[Marketers] have to figure out how to build a bridge between corporate social responsibility and the brand."

I would suggest though that you can�t do that by just bragging about your sponsorships. Because if it�s all about purpose, then you need to be able to align your brand with the intent. It�s not enough that you care - why do you care? And what difference are you as a brand committed to seeing through caring?

Here�s the difference. �I bought a can of soup today� versus �I bought a can of X soup and fed a child in Y a meal�.

In other words, by linking their product not just to meal-times at home but to the wider cause of hunger worldwide, a soup company could correlate each action a consumer takes in the shopping aisle to an action they�d like to see happen in the world.

When someone buys a can of your soup, what happens? � Anything?

What happens when communications agencies lose the creative monopoly?

Mark Di Somma — Tuesday, 20 October 2009

It�s interesting what captures your eye. Right at the bottom of this article about Google�s plans to launch an ad campaign to promote its apps to the business world was a para that has disquietening overtones for communications agencies around the world. It was the fact that the creative part of the campaign had been designed in-house by Google�s own Creative Lab team led by former Ogilvy & Mather executive Andy Berndt.

At Audacity, we�ve noticed more and more companies shifting creative resources in-house to teams sometimes headed by ex-industry insiders. The idea itself makes complete sense for some companies - but it also represents a potentially massive shift in the power balance for the traditional ad agency-client relationship if it gains a lot more traction, because it means that the one of the things that creative companies have always seen as their key competitive advantage - their access to creative minds - could be under real threat.

Take away that creative monopoly, and the shift in media spending trends to online actually becomes a relatively minor matter. Of far more concern surely if you�re an advertising agency, and the research is organised in-house by your client, the creative work for your client is done in-house, and the media is planned and placed by a specialist agency is - what�s your role now?

The real rub is that the companies that spend enough to now find the prospect of bringing this resource in-house are the very people that the ad industry has always depended on. And if this is an idea that works for Google, would it work just as well for other Fortune 100 companies?

When talent has the means and the incentive to move beyond its traditional industry silo, a whole lot of things have the potential to change.

Option or alternative

Mark Di Somma — Thursday, 8 October 2009

My favourite saying is �Life is not a popularity contest�. It�s a maxim easily forgotten in these days of convergence. But in my opinion it�s more true in business than anywhere, and most true in terms of how companies need to think about their branding.

Every brand should be actively looking to put distance between itself and its competitors. And since true difference of offer is now one of the hardest things to achieve and maintain, the most effective and cost efficient way to do that is through difference of opinion.

Every brand should look to make enemies. If I�m working on a project with Audacity where our client is #2, #3 or further down the pecking order, I start by looking for a way to pick a fight, or at least a debate, with our client�s nearest rival. Because when you do this, you give yourself an opportunity to espouse a �sticky� world view, one that people are drawn to and wish to acknowledge and support (by buying product).

If you do it well, you also draw competitors into competing with you on your terms. Apple�s PC Guy advertising campaign was a classic example of picking a fight to make a point. And the point was - we�re the significant alternative to a Windows-based world.

Difference of opinion is the fastest way to move from being an option to being an alternative.

You don�t want to be an option. Because options are like-minded decisions. An option is �I could do this, or this, or this, or this�. Read - �because it doesn�t actually matter and I feel the same about most/all of them�. Because of this, options often become price driven decisions. Say for example I need to get to Hong Kong, and I feel the same about all the airline options, I�ll very likely to pick the cheapest one.

Alternatives are different headspace decisions. Alternative is �because I don�t want/like/agree with A (or what I�ve been led to believe A stands for), I�m choosing B�. That decision is personal. It�s aligned with what a customer wants and thinks they deserve. It�s about what they believe. It�s about what they actually think is right. That�s a powerful basis for a decision. (Be warned though - if you�re going to take this route, you need to be sincere about it and you need to follow through on your commitment at every point. )

Which are you?

The importance of being Smith

Mark Di Somma — Tuesday, 29 September 2009

It doesn�t matter whether you know about Paul Reed Smith - if you�re not a guitarist. If you are a guitarist, and you�re not aware of PRS guitars, then that may say something about you too - to other guitarists who count themselves in the know.

Reading this article on why the Smith company is flourishing at a time when others are floundering is a reminder that while a cult brand may take longer to build, part of its power is in its resilience. And that resilience stems directly from the extraordinary loyalty and exclusivity that a successful non-mainstream brand can build.

One of the most interesting myths about companies that choose to cultivate brands like this (I christened them �cultrepreneurs� some years back) is that they are small.

Paul Reed Smith (PRS) Guitars is hardly that - the third largest U.S. electric guitar maker, with an amazing 40 percent of the high-end guitar market. But in almost every case, the brands that have built the fierciest loyalty have made the scary decision to chase respect rather than popularity.

What�s really fair?

Mark Di Somma — Sunday, 27 September 2009

Two interesting dilemmas in this piece about the politics and commercialisation of fair trading.

Firstly, should an idea with a deep social undertone be turned into a brand? Is that in itself ethical?

Secondly, is such a global brand a good thing or a bad thing?

Melbourne coffee trader Moshe Tawil has significant issues with the Fairtrade Labelling Organisation, a German based multi-national that has made its blue and green Fairtrade stamp synonymous with the movement, and in the process has become the recognised certification standard for all those wishing to promote this style of trade. The key issue seems to be that, in exchange of the endorsement that comes with that logo, the company takes 2 per cent of sales as a licensing fee.

There�s no doubt that this is a successful initiative. In 2007, sales under the Fairtrade logo accounted for about 2.3 billion (NZ$4.7b) worldwide, up 47 per cent on 2006, and supported 7.5 million people in the developing world. That means of course that the Fairtrade company is making a fair chunk of change, money that people like Mr Tawil argue should be going to the producers rather than into the pockets of the certifiers.

It seems that, perhaps in reaction to Fairtrade�s perceived monopoly, organisations like the British supermarkets are setting up new standards that some fear are based on minimum standards and could end up protecting the very practices that the fair trade movement intended to counter.

My questions:

1. What�s the difference between Fairtrade owning the concept of fair trade and the Heart Foundation charging to endorse healthy foods? Is the problem with the concept, or the scale of its application?

2. Would the fair trade movement have been as successful without the Fairtrade stamp? In other words, if there had been no brand, and therefore no licensing fee, would the movement be as popular as it is today? Is it just the existence of a middle-man that is bothering people?

3. If wider standards are adopted and those standards have different criteria, will that render the movement more powerful (because it is seen more often) or less powerful (because its standards are uncertain). Consider the mixed reviews that Wal-Mart is getting for its push to get sustainability and responsibility into its supply chain.

4. If indeed �Most well-meaning shoppers just go for the dolphins on the tin, the green tree-shaped logo or the fair trade sticker�, does that mean that people want to see the idea represented but literally do not understand what they are buying? Whose responsible for educating them? (Sounds a lot like the label debate revisited)

5. According to Victoria University PhD student Will Watterson, the way forward is the World Fair Trade Organisation's focus on promoting fair trade certification of a whole business. But could this mean even more compliance? Could we see the adoption of IFTRS (International Fair Trading Reporting Standards)? Is regulation the answer - and would it cost more, be worth more or deliver more than the current Fairtrade certification system?

What�s your CSR really saying?

Mark Di Somma — Thursday, 24 September 2009

Smart move on the part of Absolut. Link trendy no logo design for Fashion Week in London with a clear social message. In this case, the vodka maker has used lack-of-label to also express their thoughts on a world free of sexual prejudice.

What really makes this connection credible and not just a cutesy ad-line for an occasion is the company�s near-three decade commitment to the principle of equal rights.

It�s a classic example of how a commercial entity can champion a real cause in a viable and distinctive way. And a real contrast with the self-referencing, read self-serving, �sponsorships� that so many seem to think constitute social responsibility.

Interesting thought about that - and one that no doubt one will attract its own fair share of opinion - is Peter Salmon�s view that organisations that implement high profile corporate social responsibility programmes when they have no strong track record for social concern are probably just looking to put distance between what they recognise they should be doing and what they know they have been doing.

CSR as an admission of guilt. Immm � now there�s a provocative little item for the board meeting the next time you feel like livening up proceedings.

Learning to think in analogue

Mark Di Somma — Tuesday, 15 September 2009

As regular readers will know, I don�t agree with everything about Chris Anderson�s FREE theory. But two key points have been playing on my mind recently, and now it�s time to share.

The first is Anderson�s observation that every abundance creates a new scarcity - and vice versa. Absolutely agree with that. The second is that, as the new abundance, the price of digital is falling quickly, and with it everything available in a digital format - whether it�s computers, music or (with the success of Kindle) books.

So, what�s the new scarcity?

I think it�s analogue - and by that I mean the things that are hard to reproduce quickly and with minimal effort, the �hand-crafted� stuff.

Books used to be like that. They could be reproduced, but only with a high level of determination. Now that they�re moving online and electronic, they�ve gone digital. And if Anderson�s right, their price will drop accordingly - because once a book stops being hard copy, and exists instead as a file or a link, reproduction time and difficulty plummets.

The new law of market physics it seems to me is:

Ability to charge for value = inability to forward effortlessly

Special experiences, for example, retain their value because they�re not easily cc�d. TED has huge analogue value. Sure, I can watch the videos but the atmosphere, the conversations, the networking - these are things that are affect each attendee individually and so are impossible to reproduce generally.

To get what TED gives, you have to be there. And you have to keep coming back and paying again and again to access more TED experiences. Because every experience is different, the price doesn�t drop.

So what does that mean? It hints at an irony: a business model where the thing that makes you popular is not where you make the money. And the things that make you money are sufficiently removed or different from what makes you popular in order to be limited. Cheap or free records, but expensive concerts, for example. Because the record is easily reproduced, but a concert atmosphere is not. It also hints at things like concert-only versions of songs or indeed concert-only songs.

And that in turn offers the possibility of a fully inverted business model, where the record becomes the marketing for the concert (not the other way round).

So what's going on at Audacity?

Mark Di Somma — Tuesday, 15 September 2009

For those who are interested in what happens over at The Audacity Group, we've started a Twitter account.

Wanna follow?