Winning Ugly: Innovating in Times of Crisis

Thursday, 28 May 2009 - Sofia, Bulgaria

Presentation Summary

In this presentation at the Marketing Innovation Forum in Sofia, Kevin Roberts stressed the pivotal role that ideas and innovation will play to counteract the current downturn. “In the midst of catastrophe innovation is crucial. Your job is to reset your priorities…win now and you win for years to come.”

Europe is in the depths of the worst economic crisis since World War II. It’s gone beyond recession. This is a catastrophe.

In the first three months of 2009: Germany’s economy shrank 3.8%; Austria’s 2.8%; The Netherlands 2.8%; Italy 2.4%; UK 1.9%… and Bulgaria? The IMF expects it to contract 3.5% in 2009.
Together we face a credit crisis and a social crisis. Both are driven by the same force: a crisis of confidence.

But we were made for times like these.

“Winning is not a sometime thing; It’s an all the time thing. You don’t win once in a while; You don’t do things right once in a while; You do them right all the time. Winning is a habit.” – Vince Lombardi

Ideas and innovation are the answer. Every successful innovation is inspired by an idea.

In this economy, a transformational idea is the only thing that will create growth, jobs, choices, opportunities and self-esteem.

Ideas are the currency of the future.

But when we talk “ Marketing Innovation” we’re talking about us. Let’s turn innovation around. Let’s think “Consumer Innovation”. The new reality. What they want, not what we’ve got.

Marketing is important in tough times. But it’s not to sell people stuff they don’t want and can’t afford. Our job is to offer help and hope, to listen and participate, and then to take responsibility and do what’s right.

The purpose of innovation is to improve lives.

We usually think of it as creating something new that generates value. But what truly creates sustained value? Better lives.

The role of business is to make the world a better place for everyone. Everything else is energized by that goal.

That’s why Saatchi & Saatchi is going True Blue.

The heart of True Blue is to inspire people to make the best choices for themselves and for the planet.

We founded Saatchi & Saatchi S on True Blue principles so doing the right thing is fun, irresistible and viral.

We believe:

1. The role of business is to make the world a better place.
2. Consumers can change the world.
3. Change is ignited by emotion.
4. Sustainability as a catalyst for business growth.

We’ve learnt you only get somewhere new when you do something different. An idea is an idea once. No one has seen it before.

In the midst of catastrophe innovation is crucial. Your job is to reset your priorities. Your clients are facing new problems, so give them new solutions. Win now and you win for years to come.

• Innovation that creates new opportunities and new markets.
• Innovation that cuts costs rather than automatically cutting price.
• Innovation that connects with consumers fast.

Example. Hyundai’s offer that customers can return a new car if they lose their job. Hyundai is up 14% while the U.S. auto industry is down 37%.

• Innovation that connects people with each other.

Example. Worldwide visitors to Twitter.com increased 95 percent in March from 9.8 million to 19.1 million.
Source: comScore

• Innovation that stuns our clients.

The job of marketing is to keep coming up with fantastic innovations. Not incremental improvements, not minor tweaks, but innovations that create sustained emotional value.

Emotion drives about 80% of how we think; reason, 20%. Emotional value trumps functional value.

You can measure the value of innovation by profitability, customer satisfaction, revenue growth…or you can innovate.

Ask the big question: Do people want to share this, rave about it, add to it, play with it?

HOW DO GREAT INNOVATORS WIN?

By Winning Ugly. Winning Ugly is the smart attitude in tough times. It’s fast and furious, rough and ready, profoundly emotional.

• Expect the unexpected. No one has been here before. If you feel you’ve got it under control – you’re probably headed in the wrong direction.
• Control the controllables. There are some things you can control – so control them! Costs. Suppliers. Sometimes your people!
• Focus on what’s core. This is not a call to “Do what you do best.” Win sustained advantage with the four elements of Blue Ocean’s Transformation Grid.
• Act fast. Consumers aren’t waiting for your next planning session. At Saatchi & Saatchi we have a 3-Day Rule. Someone has a problem, they get it to me. I promise to get back to them in 24 hours with a decision. They promise to action it in 24 hours. Fail fast, learn fast, fix fast.
• Face Forward. Stand tall. Be brave. Don’t let your clients play it safe. Inspire them with your confidence.

But Winning Ugly is not just for tough times. It’s for every time.

FOUR WAYS TO INSPIRE INNOVATION WITH WINNING UGLY

1: INSPIRE WITH ATTRACTION

Attention is no longer the core. Attraction is.

The marketing industry talks ‘holistic’ and ‘integrated’ and ‘interactive’ but too little has changed. The hierarchies are the same, the jobs are the same, the results are the same.

Trouble is, consumers are not the same, technology is not the same.

People today live on screens. Screens that are connected. The essence of community is emotion. Think Facebook, Twitter, Flickr, YouTube.

They still want to watch – but they want to comment, play, chat with fellow fans whether they’re in the same room or on the other side of the planet.

And/And Fact. One in ten people (11%) watched the Oscars in 2009 while logged onto the Internet. Source: Nielsen Online

The digital revolution is transforming marketing, entertainment, communications. This is SISOMO, Sight, Sound and Motion on screen.

Fact. It took newspapers 127 years to reach $US20 billion in ad revenues in the US; Cable TV took 25 years; online media got to $20 billion in just 13 years. Source: Strategy + Business.

Our job now is to be creative connectors. To develop experiences that get people talking. To create the fastest, most exciting ways to get emotional connection, participation and fun.

2: INSPIRE WITH LOVEMARKS

Winning Ugly says: Face Forward. Don’t play it safe. Our job is to transform marketing. Brands are out of juice as profit engines that differentiate.

Fact. In 40 out of 48 categories, consumers perceive brands as becoming more similar. Source: Copernicus Marketing.

Brands need to innovate and become Lovemarks.

• Brands are built on Respect. Lovemarks are created out of Love and Respect.
• Brands invest in Trust, Performance and Reputation. Lovemarks involve with Mystery, Sensuality and Intimacy.
• Brands are owned by management and stockholders. Lovemarks are owned by the people who love them.

Example. Tropicana tried to innovate and change its packaging in January 2009. The result? A consumer revolt, a sales drop of 20% and a rapid return to the old design. The good news? Successful innovation works with fans, not corporate strategy.

• Brands build Loyalty for a Reason. Lovemarks inspire Loyalty Beyond Reason.
• Great Brands are Irreplaceable. Lovemarks are Irresistible.

3: INSPIRE WITH BOTH LOVE AND RESPECT

Winning Ugly says: Expect the Unexpected. And that’s what the Love/Respect Axis maps – The potential for innovation.

Low Respect. Low Love. There’s no innovation here, only desperation. US Airlines, US banks!

High Love. Low Respect. The home of “NEW” and “NOW.” Innovation heaven. Most fads flare and die, Crocs were a recent casualty. Some fads break through to Lovemarks: Text messaging, once a kid’s fad, now generates $100 billion a year in revenue for telcos.

High Respect. Low Love. “E-r” words: faster, bigger… cheaper. Just what you’d expect. Respect has sucked up most investment over the past 50 years. The potential, the unexpected lies in emotion and passion. In Love.

High Love. High Respect. Lovemarks – authentic, simple, music to our ears, from iPhone to Emirates airlines, Lili Ivanova to M-Tel.

If you always get what you expect, there’s nothing to attract you.

4: INSPIRE WITH VALUE

Winning Ugly says: Act Fast and Win. Value is the new action attraction. Value is not about cutting back or compromising for consumers, or for us.

Differentiate price from value. Price is an easily matched commodity. Essential, but table-stakes. Priceless value demands innovation.

Consumers are taking control of value for themselves.

• They want to spend less, but get more.
• They are evaluating their habits and choices.
• They know the difference between true value and false economies.

Where to get started? Don’t settle for insight. Insight has been commodified. Sustained innovation demands Revelation. An astonishing disclosure of spirit of truth.

Surprise with the obvious

• Treat passengers like…people. Virgin offered meals when people felt like having them, not on the airline’s schedule.
• Push not turn. Prius did it with the button ignition.
• Apple made technology…beautiful.

When everything is less, give them more. Give them different.

The most researched group in the world has got to be the American Mom. And what do we find? 73% of them feel that advertisers don’t really understand what it’s like to be a Mom. 73%! [Brandweek 5 May 2009]

There’s a lot of room for revelation.

“Saatchi & Saatchi will never know more about cars than Toyota – and we will never know more about the people who buy them than Saatchi & Saatchi.” – Yoshi Ishizaka, Toyota.

Innovation in the 20th century was built on the ‘er’ words: make it bigger, faster, cleaner, cheaper.

Innovation in the 21st century is being created out of emotion: health, value, happiness, partnership, experience, social and cultural responsibility, fun.

So make sure you are a 21st century innovator or be left behind.