Category Archives: Business

Dec 23 2015
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Advertising, Business, Digital Strategy, Insight, Marketing Strategy, Planning, Social Media, Strategy

Farts, Apple Watch, Racial Tensions: This Is What People Read in 2015

Another year is nearing its end. This year the most popular posts ranged from flatulent humor to Apple watch (and everything in between).

I had time to post a little bit less than on previous year, but readership remained stable and some surprises in the most read post list as well. You never know yourself what post will tickle your reader´s fancy.

This year I read lots of interesting books, saw some interesting movies and had some interesting debates. However, despite the Apple Watch, the year seemed a little bit boring from advertising and technology point of view.

I think it will be calm before storm, and next year will be humongous (both in macro and micro –level).

Or it is just the same old shit, you never know.

Most read posts 2016

  1. Ideas are like farts
  2. Why Apple Watch is Crucial For The Future of Apple
  3. Anatomy of An Insight: #Joulurauhaa
  4. Rethink Your Marketing Research
  5. Forget The Apple Watch This Is The Only Wearable That Truly Matters
  6. 5 Ways To Make Your YouTube Pre-Rolls Kick Ass
  7. Agencies Are Slow
  8. Digital Pre-Testing: Harmful Waste Of Money
  9. Just Say The Obvious, But Do It With Flair
  10. Anatomy of Insight: Straight Outta Somewhere

This will be my last post for the year.

I will be returning, whether you want it or not, in 2016.

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Dec 21 2015
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Advertising, Business, Digital Strategy, Insight, Marketing Strategy, Planning, Social Media, Strategy

#sometrendit2016: The Only 2016 Social Media Trends You Should Read

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As the year approaches the end, it has become an annual tradition for me take a look at crystal ball and share my views with Kurio Social Media Agency on the next year´s social media trends.

For those adapt at Finnish, I recommend reading the whole report. If you are not interested in the predictions of 28 other Finnish digital marketers, you can also jump straight to the most important ones (mine) below.

Before I go into my answers, I have to quote myself from the last year:

I have to say that I have not been interested in social media as such for a long time. Do not get me wrong. Social plays crucial role in digital business. But I seldom think digital as a separate entity either: digital is air. Digital, mobile and social should be a part of every business. Sometimes at the core, sometimes playing supporting role and sometimes playing no role at all. Strategy is about deciding what to do, but even more importantly what not to do. If you are thinking social media as a separate unit you are missing the bigger picture. 

The dominance of digital universe goes well beyond our traditional silos.

And here are the bold/boring predictions of 2016:

  1. 1. Biggest Social Media Trend in 2016?

Internet will be build more and more upon instant messaging. We have moved to the latest phase of Internet: the Age of Messaging. What is most interesting, who will be the master of that era? If previous phase was the Age of Social and Facebook was the undisputed king, is it able to keep its lead? Currently it seems with the dual-strategy of WhatsApp and Facebook Messenger that Facebook will continue to dominate.

2. Social media platforms to look out for 2015?
Last year I was speculating about anonymous messaging and those services were not able to live up the hype. On the same speculative tip, I would keep an eye on live-streaming platforms like Periscope. It is easy to recognize the opportunities Periscope can bring to the brands. Bigger question is will they be truly interesting to actual users?

It is worthwhile to keep an eye on WeChat, because what it does today in China, Facebook will do in western world tomorrow with its Facebook messenger.

3. Biggest challenges in doing social media marketing in 2015?

The huge portion (probably somewhere around 3/4) of sharing in social media is so-called “dark social”. This means that social media listening gives one-sided and even totally faulty picture about what people are really talking about. People share where the brands play no role.

This is great for consumers, because brands are not ruining your conversation or begging you to like them. It makes our work way more difficult. Established channels like FB and YouTube are 100% paid media. To some IM services you cannot get even when you are paying. There is no such thing as earned media anymore.

4. Social Media Buzzword, which hopefully disappears in 2015?

Content marketing.

Despite all the hoopla about native advertising and new content agencies, the division of labor is simple. In Internet there is only good (or bad) content or good (mostly bad) ads. Ad agencies have shown that they cannot truly create content and content marketers have not been good at creating ads (which essentially move products of the shelves). There is role for both counterparts, but it is utter stupidity to think that you could replace one with another. Or that one agency could be great at creating both of them.

To see what I have been predicting in previous years, see the following links:

Social Media trends 2013

Social Media trends 2014

Social Media trends 2015

 

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Dec 09 2015
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Advertising, Business, Digital Strategy, Insight, Marketing Strategy, Planning, Uncategorized

Obey Your Data

For various reasons I have been reading quite a bit about big data lately. Based on everything I read and the experience, I have come to three conclusions:

  1. It does not matter anymore why something happens. It matters that it happens.
  2. In life there is no such thing as certainty; therefore you should just aim for high probability.
  3. Correlation trumps causality.

“In many cases, the deeper search for causality will take place after big data has done its work, when we specifically want to investigate the why, not just appreciate that”
Viktor Mayer-Schönberger, Kenneth Cukier (Big Data)

I would say that in our industry knowing why is more of a philosophical question. Examples show that when you just work on what you have (data) and act on that, the results are better. If data shows that it works, you don´t really need to know why it works. It might be interesting from academic point-of-view, but should not matter when doing marketing for the people.

There is still aversion against data in our industry. Maybe it is because logically thinking people generally don´t gravitate towards advertising (and why our business models are so antiquated). For lack of better data, we have tolerated egomaniacs (disguised as gurus) in our industry for too long.

Advertising is not a rocket science; it is just a data science. Just like everything else in this world.

We have self-inflated view of how difficult our work is, but eventually we will be replaced by algorithm. Gut feeling is not necessarily bad if it is based on experience. I.e. if you have done thousand display campaigns you know anecdotally that call-to-action button should be red. Too often, someone just wants it green because it is his favorite color. And person with no experience could say the right thing just based on the right data.

Experience will trump stupidity.

Data will trump experience.

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Oct 27 2015
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Business, Insight, Strategy

Forget the Unicorns, Focus on Cockroaches

There has been lots of talk about the current tech bubble or lack thereof. Valuations have gone over the roof and money. When we are hunting for flashy unicorns, there might be many hidden ugly ducklings with lots of potential.

One can´t help but wonder that many of the new start-ups seem to be just over glorified pizza delivery services that work on your mobile phone. Although drones, virtual reality and wearables are sexy, majority of the start-ups working in the sexy side of things are just flash of the pan.

Money is where boring is.

That is why I would turn my focus to food for the next growing category. Regardless of the latest iterations of iPhone, the last time I checked, all the people still need to eat. Every one of us have to eat to live, but to make some better margins there are quite a few people who are living to eat as well. Today´s food trend is tomorrow´s food mainstream.

The next growing food category is bugs, crickets, grasshoppers and other insects. As you might have heard, the insects might be the solution for the growing demand of food. Eating insects on various forms makes perfect sense:

There is currently couple of interesting insect protein start-ups originated from Kickstarter. Both use cricket flour in their insect protein bars: Jungle Bar and Exo Protein. Bars are one thing, but I recommend eating insects also. Little bit of butter and salt, spider to the pan and you have perfect dish.

Future of food

My first encounter with fried tarantula in Cambodia 2008

If you scorn on eating ants and spiders, it is good to remember that lobsters were once considered as “the cockroaches of the sea”.

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Sep 30 2015
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Business, Insight, Marketing Strategy, Strategy

What My Disdain for Grateful Dead Can Teach About Branding

Music has played crucial part of my life. It started with hiphop and heavy metal and has throughout the years expanded to almost every possible genre. One cult band that I have however never truly understood has been Grateful Dead. The hippy band is know for their marathon gigs like this:

I am not the biggest fan on The Beatles, Rolling Stones, Frank Zappa or Bruce Springsteen, but I still can get why people love them so much. I noticed that Grateful Dead was doing their farewell gig (to celebrate their 50th anniversary) on this July and that prompted me to again test some of their material on Spotify.

Nothing.

Nada.

Zip.

I totally fail to realize what makes people to devote a cult following to band so bland. Maybe it is because I don´t do drugs or have not been part of the hippy movement. On the other hand I don´t gangbang, but I still truly enjoy and find resonance in N.W.A.´s music. Grateful dead remains as a big enigma for me and to many others as well.

Grateful Dead

Some old hippies

“We’re like licorice. Not everybody likes licorice, but the people who like licorice really like licorice.”
– Jerry Garcia

But why would I care about Grateful Dead? Or why would Grateful Dead care about me? I am not their core audience. If you are selling licorice, you don´t need to care about people who don´t like or licorice. This is the fault that many marketers have. They mistakenly believe that their target audience is everyone, which is hardly ever the case. If your target audience is everyone the individual purchase is small. When you have focused audience, you can ask for premium price.

Brands get super touchy-feely when blogger outside their target audience says something negative. It does not matter at all. Focus on your cult following. If you want to create a cult around your brand, you have to also alienate the non-brand followers. For deadhead, there are only “we” and “they”. If your product is only meant for alpha-male blokes, why should you worry about offending women ot vice versa?

“In the 1960s, Grateful Dead pioneered many social media and inbound marketing concepts that businesses across all industries use today.
– Brian Halligan and David Meerman Scott (Marketing Lessons From Grateful Dead)

Although listening to Grateful Dead is equivalent of water torture, I have to applaud their business acumen. They were never high on the charts, but were able to focus on small devoted and lucrative audience. They kept the loyal customers happy and did not waste their efforts on trying to get new and fickle customers. Funnily enough, there are at least two books dedicated to business lessons from Grateful Dead.

Brands spend much of effort on parity. They want to make their brand easy to compare with other brands. That is the main fault. If you create your own category, the customer has only two choices: either buy or not. Love it or hate it. Ambivalence is not an option.

“They’re not the best at what they do, they’re the only ones that do what they do.”
-Bill Graham

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Sep 23 2015
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Business, Digital Strategy, Marketing Strategy, Planning, Strategy

Will Ad Blocking Be The New Napster?

Apple has basically failed at the ad business and they are trying to ruin it for everybody else.

– Jeff Jarvis

Google owns the web. Facebook owns the social. Apple owns the phone. That has been the technology world order for a while.

Now that order is about to shake.

The discussion about ad-blocking has been a hot topic, because the new iOS 9 has ad-blocking features for Safari mobile browser. The strategy for Apple is simple. This is full-frontal attack towards Google. Google hosts majority of the ads in “the normal web” with other Apple rivals like Facebook and Microsoft. Apple does not play the browser ads game. However they are serving ads in iOS applications that they not “surprisingly” block. Also conspicuously Apple launched their news service at the same day as it allowed ad-blocking.

It remains to be seen how things escalate, but the following three things are certain:

  1. Widespread ad-blocking will kill publishers

The casualties of war between Apple and Google will be the content publishers. They are already losing $22 billion of revenue this year because of blocking of the ads. If content publishers are not serving the ads for the content you are consuming, they are not getting paid. If you are not getting paid eventually you go bankrupt. As the piracy shows people do not really want to pay for content, so advertising has been the only way to bankroll the content production. Only 11% in US and 6% in UK have paid for online content. So subscription model online does not really work, although people are advocating for it. Even creator of popular ad-blocker Peace, pulled the ad-blocker from App store because he had regrets:

Achieving this much success with Peace just doesn’t feel good, which I didn’t anticipate, but probably should have. Ad blockers come with an important asterisk: while they do benefit a ton of people in major ways, they also hurt some, including many who don’t deserve the hit.

–Marco Arment

Not all of the creators of ad-blockers have surely similar regrets. Even without Peace, ad-blockers have been the most popular paid apps in the new iOS 9.

  1. Generally online ads have been of bad quality

Ad-blocking is already more prevalent than ad-skipping on television. Ad industry should take some responsibility of the horrible, low quality and invasive display advertising as well. Advertising in web is democratic, which is great to certain extent but also has been the core problem. When amateurs do, it is quite often amateur quality. In TV there has at least been some quality (of varying degree and based on channel).

As people have not noticed online ads, they have become more and more invasive and making the user experience worse. Even people from the industry are skipping the ads. Therefore I actually believe more in longevity of pre-roll advertising format than the banner on the long run (although I still think there is much room for creativity when doing banners). Nevertheless, both of these can be blocked so you don´t need to necessarily endure either.

  1. Traditional online ad industry will face the same future as music industry

If ad-blocking will become the norm that will essentially kill the display advertising, as we know it. We can debate whether it was good or bad, but essentially Napster and then after the legal counterpart iTunes and Apple Music killed the music industry, as we knew it. Today´s music business is much more nimble and record labels are playing lesser role than before. Music has not disappeared anywhere though.

Killing the category is only lucrative for the killer. Apple has been the giant killer many times (helps when you are giant yourself), so I doubt that they are hesitating in trying to bring competitors (namely Google) down by any means necessary. For the consumer the fall of online ad industry does not really sound too bad. Generally all of the people (hell, even publishers) find ads annoying. Expect that those annoying ads pay for the content production online like mentioned above (and print media is almost dead already). In every change there is opportunity for innovation. Pagefair is actually serving “non-intrusive ads just for your ad-blockers”. Talk about contradiction in terms.

Modern digital marketer has to follow closely how the situation with the ad-blockers will evolve and act accordingly with your media mix. Native advertising will seem likely winner in this new era. Will that result in better content or just more bad editorials? My fear is the latter.

By the way, I don´t block ads. Maybe just to show solidarity to publishers and to be true to my profession. On the other hand I don´t tolerate sloppy and invasive ads either. We need to improve so that people would not want to block those ads on so alarming pace.

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Aug 25 2015
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Advertising, Business, Strategy

Agencies Are Slow

“A screenplay can be written quickly and detective story can be knocked out in three weeks, while no one should spend more than a month on a doctoral dissertation. A novel, however, takes longer”
-Werner Herzog (A Guide To The Perplexed)

Why majority of agencies are doing such a bad job at the moment?

They are slow.

The best young talent goes to start-ups, because the pace is fast and the mentality is about getting things done. Bigger agencies are filled with bureaucracy, internal meetings and all other fluff, which is not what they should be doing.

Agency business is essentially simple and your time should be divided to three parts:

  • Figuring things out
  • Doing the actual things
  • Selling things

Not to say, we could not be much more effective with all of those three things. Everyone is a procrastinator if just given the opportunity. Agencies also have higher proportion of people with general aversion to anything resembling a process, so our ways of working are not as effective as they could be. That is not the main challenge, though.

The bigger problem is that people cannot focus on these three things. When I talk with my colleagues working in different agencies around the world, the common complaint is that there is not enough time to concentrate on the real work. There are too many people who misattribute internal meetings and all the administrative wanking as real work. And unfortunately as the agencies get more bloated, they also hire more dead weight complicating the real work with all the additional layers.

Unwanted bureaucracy, unnecessary administration and too many useless people result to agencies being slow. At the same time they have to rush things that really matter. Start-ups concentrate on what is important and spend adequate time on it. Rest of the stuff can be bashed out quite quickly.

“It was decision-making by committee, some kind of artificial respiration, which certain inbuilt weaknesses. Too many people were slaves to handouts, forever trying to fulfill the wishes of the boardroom, which is why so many of them made only one film, then gave up. They were too busy filling out paperwork”
-Werner Herzog (A Guide To The Perplexed, talking about film subsidies in Western Germany)

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Aug 17 2015
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Advertising, Business, Marketing Strategy, Planning, Strategy

Marginal Gains vs. Changing The Game

“The difference between stupid and genius is that genius has its limits”
– Albert Einstein

We have limits as humans.

Luckily we have not yet reached them in majority of things. But for example, baseball pitcher cannot throw faster than 100 MPH. Although pitcher could get stronger, his tendons and ligaments would just snap throwing it faster.

Throwing the baseball is one aspect of baseball, so that is why there will be plenty of evolution in the baseball. Scientists have calculated that even in other sports the pace of development has slowed down and we are approaching the limits. Actually in some sports like long jump we are getting worse.

Being an optimist, I take there is a still lot to improve for us in humans: whether in sports or in life in general (I don´t know why anyone would make a separation between those two). These developments will happen by either tweaking the small details or reshaping the big picture:

 1. Aggregation of marginal gains

aggregationofmarginalgains
“The marginal gains philosophy requires you to look at every single aspect of what you do so you can try and improve it. It looks at every aspect of performance, and tries to improve each a little bit— even just a tenth of a percent . If you find a training technique that makes an athlete that tiny bit stronger , it alone might not have a huge effect on a race. But if you can stack those very small improvements on one another, finding a bit in tires and a bit in the wheels and a bit on the track surface and a bit in nutrition supplements— well, soon those marginal gains begin to add up to big gaps between you and your competition.”
Dave Brailsford on aggregation of marginal gains

Dave Brailsford started as the general manager for Team Sky (Great Britain´s professional cycling team) in 2010. He had the concept laid down in the quote above: if you improve every area related to cycling by just a little bit (most commonly is used 1 percent), then those small gains would eventually add up to bigger improvement. These improvements ranged from the obvious (training, nutrition) to more surprising (every cyclist had their own pillows when they are travelling). The results were outstanding. Brailsford was wrong in believing that Team Sky could win Tour De France in five years. They did it in three.

This works when the competitive field is already mature. Cycling itself is quite established sports, so there is not necessary that much innovation (doping excluded) to be done.

The difference nowadays between agencies is not in the actual ideas, but in the craft. Similar ideas have gotten totally different reception in marketplace and also in award shows. When we essentially are doing the same things, the difference comes in small details.

Has our industry then just become minor improvements and tweaking in quite predictable playing field?
Not necessarily.

2. Disruptive leaps

Disruptive thinking has radically altered the sports. Quite often the change is driven by technology, but sometimes it is also about the different way to approach the challenge in sports.

a) Technology disruption
golfevolution
“I think the players, I put in the book for example that we should go back to wood rackets, probably they laughed at me, I’m a dinosaur, but I think that you see these great players, have even more variety and you see more strategy, there’d be more subtlety.”
John McEnroe (last player to win major tournament with wooden racket)

Technology has played huge role in certain sports, especially in golf driving distance. We are not talking about marginal gains in here; these technologies have truly revolutionized the sports.

Internet has changed the whole ball game in our industry. Either you have digital capabilities, or you are like a guy trying to play with wooden racquet in tennis court. Not only you look stupid, you will also certainly lose.

b) Approach disruption
vstyle
I adapted an antiquated style and modernized it to something that was efficient. I didn’t know anyone else in the world would be able to use it and I never imagined it would revolutionize the event.
– Dick Fosbury (inventor of Fosbury Flop)

Not always you need a technological breakthrough to change the game. V-style jump in ski-jump or Fosbury flop in high jump are examples when smart individuals outsmarted the competition. They looked the problem from a different angle and found a totally new and more effective way to solve it.

Currently every agency is jumping with the old style, where the room for innovation is limited. When the playing field is the same for everyone, the only way you can win is to search for marginal gains. I truly believe that we could approach our business truly differently and take the whole agency business model to the new heights. It is time to rethink the whole jump.

(Full disclosure: These sports anecdotes were mostly lifted from the great book I just read. The book is done by Mark Mucclusky and is called “Faster, Higher, Stronger. Highly recommended reading)

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Apr 23 2015
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Business, Digital Strategy, Planning

Loalty is Laziness: Would You Change to Apple Music From Spotify

Apple will launch its streaming service Apple Music June 30th.

Although there was not anything mind-boggling with the launch, it will dramatically shake up the music streaming service landscape. Below I am answering all the questions that you are thinking about the launch, because I can:

Will Apple Music be bigger than Spotify?
Yes.

In terms of paying customers, Apple Music does not offer free version, which is probably a wise move. Currently paying customers create 26 more times the revenue compared to free customers in Spotify.

Spotify has 70 million users (of 20 million are paying). Apple has over 800 million iTunes accounts. Do the math. Just converting 2,5% of the current user base (of which not all are naturally downloading music) gets them even.

However it might not be as easy or as profitable it would seem at first glance.

Paying for streaming music is a niche activity. Only 5% of the people over 13 years old pay for streaming services. During the digital download heyday, 25% of the people were regularly paying to download music and astonishing 80% of people were regularly buying cd´s when that was popular. Those days will never come back.

Optimist would say that there is an opportunity to increase the amount of subscribers. Pessimist would say that we will never reach a level again where even 25% are paying for music. My thinking is somewhere in between: there is opportunity to increase the paying streaming category but it requires cheaper options than the current default 9.99$/month. In terms of people paying for music streaming services are the best bet for record labels, because ownership of music seems quite expired concept in 2015.

Because of its ecosystem and deeper pockets, Apple has better opportunity to grow the category if it is to grow. Free streaming services will remain in the mix, because too aggressive clampdown for free streaming would probably retort people back to pirating the music. Also those who pay for music are not necessarily the tastemakers of what is hip and cool. In 2015 the investment to music is not necessarily an indication of its popularity.

Is Apple music then a better service than Spotify?
No.

At least based on the current information.

In terms of library they are in parity (30 million songs both, no Beatles in either of them). The main features Apple was talking about were nice-to-haves, but nothing that would immediately make people to switch. Beats 1 is essentially just a tradtional radio. Curation from tastemakers is something that sounds nice in powerpoint, but masses don´t really care. Same thing with Connect, music fandom is way more niche activity than non-committal music consumption on background.

Will people flood from Spotify to use Apple music?
Well, it depends.

If you are invested in Apple ecosystem and have been buying from iTunes music before, that is likely to happen. Over half of the Spotify users are also using iTunes. If you do not have that legacy, you are not likely to switch from Spotify unless Apple manages to bully its way with labels to worsen the current Spotify.

Why?
We are lazy.

Brands often mistake the laziness of users for loyalty. It is natural for people to try to avoid stressful situations and change (even how big or small) is always stressful.

It is hard to unlearn your habits, whether they are good or bad (especially the bad ones). It is also hard to learn new habits even how beneficial they would be to you. Therefore just making things easy-to-use is not enough for people to make a switch. They need incentives and motivation: the right balance of stick & carrot. People keep using hard-to-use methods (like pirating) because that is the way they have accustomed themselves and cost of learning something new feels too hard.

In many ways both Spotify and Apple will benefit from the laziness of their users.

Current Spotify paying users will not flood to Apple. Those who are using the free ad-fueled version are different target audience altogether, so Spotify will also be growing in terms of overall users. If you are Spotify free user and have not turned to paid version with Spotify, it is quite unlikely that you will start paying with Apple. On the other hand, testing the Apple Music will be just a click away and it works seamlessly with your iTunes library. So those people who have been postponing moving to streaming services and have still been paying for digital music downloads, don´t have that many excuses anymore.

And to answer the question posed on the title of this: no, I will not switch to Apple Music. On the other hand, majority of my investment in music still goes to vinyl records. Like said before, old habits die hard.

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Apr 01 2015
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Business, Strategy

Asia is Driving Innovation

Unfortunately there is still almost colonial attitude towards emerging markets in the western countries (especially US and Europe). When dealing with people who are not living and working this region, the knowledge of the development and innovation happening in here is still quite modest. Everyone recognizes the business potential, but they think that it is just some void, which can be filled with western products.

They could not be more wrong.

Micromax is biggest phone manufacturer in India.

Xiaomi is the world´s third biggest phone manufacturer and China´s biggest.

Alibaba is worth more than Amazon and Ebay combined.

There are two prevalent myths, which are just wrong. Other is that all the Asian brands are just copying western brands and doing it cheaper. Other is that their whole success is based on the big local markets. These myths are not the whole picture:

1. Asian brands are not just cheap copycats.

Micromax has cheap phones that is true. They also have a solar powered phone. I think that is quite cool. Xiaomi admittedly copies Apple with pride, but it has also totally disrupted the way to sell the phones. Innovation takes different forms in the Asia that is certain, but identifying all the brands as either copycats or cost cutters is dangerous simplification. Price is a big issue in all the markets and many Asian tech innovations have been able to do things more cheaply which is appreciated also by western consumers.

2. They are not popular because they are local, but because they understand local consumer.

One of the main push for Line & WeChat for their popularity, was the addition of stickers. As the script language is slower to type with your mobile, the emojis on steroids enable you to communicate faster and convey more emotion. Facebook messenger has definitely taken some cues from WeChat and Line in its position. Flipkart & Alibaba have understood the delivery dynamics on their respective countries better than Amazon and therefore are now kicking Amazon´s ass.

No matter where you are, you should have eye on Asia. Not only because the region is growing, but also because the next big innovation is coming from (around) here.

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