Opinion

Building a brand when all around you are losing theirs

While television was the dominant home of brand building in the past, the game has changed and ecommerce platforms might just be the next powerhouse for start-ups looking to grow their companies and shift product, writes Mumbrella's Dean Carroll in a piece first published in his 'Best of the Month' newsletter

So the issue that has been nagging at me of late is what brand building will look like in the coming years.

It’s something I’ve been thinking about for a while. We’re are even running a session on the topic at the Mumbrella Asia Travel Marketing Summit in Singapore on May 7, so please do get your tickets and come along.

But why is the issue on my mind so much? Partly because the media and marketing scene now is so different from my pre-internet – before-the-advent-of-mobile-phones – youth in Brexitland, formerly known as the United Kingdom.

Back then, we all gathered around the magic box in the corner of the room to watch (not very good) content punctuated by some (great) advertising. As a boy, I distinctly remember family and friends frequently uttering the phrase “oh, I like this one” whenever a great television commercial for Levi’s, or some other such zeitgeist brand, came on.

It might not have been a sophisticated model, when compared to today’s digital labyrinth of complexity, but it worked. And it allowed the likes of Dave Trott, Barbara Nokes, Lee Clow, Dan Wieden, Mary Wear, Diane Croll and Sir John Hegarty to emerge as creative forces able to entertain audiences while selling them product.

But those listed above are pretty much now in the adland hall of fame as legends of yore. And that all-commanding TV mass eyeballs model is all but finished. Take a look at the subject matter that people choose to wax lyrical on when writing our ‘My favourite ad of all time’ feature.

Most choices are from the 1980s or 1990s, even those written by millennials (I hate the word too, but shorthand exists for the sake of brevity). That tells its own story.

Indeed, the growing apathy towards TVCs was once again brought home to me this week when our Asia editor Ravi Balakrishnan reported on Singapore giant Mediacorp offering TV rate card reductions of 80% and moving from the ‘gross rating points’ metric to the ‘cost per mille’ measurement.

The reason? Because digital natives and “new economy advertisers” understand CPM very well, but have no concept of (or interest in) GRP. Playing devil’s advocate, a bigger question springs to mind. Do they have any concept of (or interest in) linear TV itself?

Another. Nail. In. The. Coffin. Sadly, those were the alarming keywords that immediately sprang to mind following the Mediacorp revelation. Especially when it was closely followed by the announcement that Channel News Asia is rebranding as ‘CNA’.

The reason being because CNA no longer wants to be associated with the television-centric word ‘channel’. Too analogue. Not digital enough for a “transmedia company”, apparently. Let’s be kind and call it pragmatism shall we.

Elsewhere this month though, there were more words of warning about outdated media activations. MediaMonks CEO Victor Knaap talked to us about the ‘mismatch between consumers and agency solutions’ and how it was a mistake to focus on TV-centred ads when “everybody is doing everything on their mobile phones”.

This got me thinking about my own broadcast media habits. I’m only really subscribed to a bundle from a telco (more on that later) so that I can watch a sample of different news channels, in order to get a rounded view on current affairs. An annoying habit I developed years ago as a journo and one that I know by my wife’s face she thinks is weird, but is too kind to tell me so.

Of course there are still event TV shows on the networks like Asia’s Got Talent and Asia’s Next Top Model that draw a sizeable audience, and the significant advertising revenue to go with it. But to be frank, a good number of network channels and the productions they broadcast are uncared-for and under-resourced.

More often than not, in our house we stick to streaming platforms like Netflix where a degree of care, and budgetary investment, can be assumed. We are not alone, just take a look at how people consume in Mumbrella’s ‘My media habits’ series. Netflix is name-checked everywhere and TV networks nowhere.

One top ad agency CEO even told me recently he didn’t give a toss about TV, as his ads were “playing at the cinema down the road right now”. Fair enough, although cinema ads could do with a bit of quality and quantity control too though, it’s fair to say.

But is all this doom and gloom warranted? Perhaps my optic should shift. For certain ad campaigns still connect and gain traction. Even if it’s through column inches and social network debates rather than TV alone. For instance, Nike’s ‘Dream Crazier’ tour de force this month was a prize example of that phenomena.

And while respected adland gurus like Bob Hoffman will tell you that Volkswagen only survived the emissions scandal due to its brand equity built up from half a century of great TV ads, and that when you walk down the supermarket aisles you will not see one brand built by digital advertising or surveillance targeting of consumers. Well, that may well be missing the point somewhat.

Don’t get me wrong, great ads can certainly still achieve great things. I love to watch them. And TV definitely still has a role to play. But ads usually go viral now because of a number of mediums. They include (organic and paid) social media and influencer campaigns (remember Fyre?) for example, rather than just because of the flickering box in the corner of the room.

There has been a separation of power. Alternative mass-market arenas for brand building have indeed emerged elsewhere. I’m not just talking about the Facebook and Google ‘duopoly’ (I know, I’m fatigued by the word too but what can you do eh?) here.

In the United States and Europe, Amazon of course dominates retail and ecommerce. This segment is perhaps the new breeding ground for brands fuelled by user reviews, deep-dive product information and then some.

In South East Asia too, we have our very own such behemoth in the form of Alibaba-owned online shopping player Lazada. It delivers our weekly groceries. It’s where we bought our TV. It’s my go-to resource when doing any sort of online shopping. And I’m not even the target audience (‘millennials’ again, sorry to the wordsmiths out there).

With that in mind, I went along to Lazada’s first-ever Brands Future Forum in Singapore a week or so ago. It was quite something. There were 300 of the platform’s top sellers (brands). The sort of start-ups you might see appearing on Shark Tank (full disclosure, I watched it on Netflix not on a TV network) after they’ve had a successful Kickstarter round to pump-prime their business.

On top of that, for the event – which would have cost hundreds of thousands of dollars to host and was a statement of intent to the market – more than 120 journalists were flown in from China, Indonesia, Philippines, Malaysia, Thailand and Vietnam. All presentations were simultaneously translated from English into Mandarin, Bahasa, Thai, Filipino and Vietnamese. That ain’t cheap to do.

During the conference, Lazada also launched its inaugural Brands Future Forum Awards. The gongs were designed to celebrate those brands doing interesting things on the platform. The winners were:

  • Best Marketing Innovation – Unilever
  • Best Product Launch – Wurdah
  • Best Social Media Activation – Pampers
  • Fastest Growing Brand – Coocaa
  • Customer Choice Award – Philips

The firm claimed at the summit that it would dominate the future and it would do so via ‘shoppertainment’ – making shopping fun by way of blending it with entertainment. Explaining the concept, Lazada Group CEO Pierre Poignant mapped out how the newly-introduced livestreaming by sellers on the platform meant that customers could actually “engage with brands”.

Sounds like absolute piffle, right? And why would established brands put their bricks and mortar retail offering at risk by colluding with the third-party deathstar of online shopping?

Not necessarily, in the main we are talking about entrepreneurial smaller and medium-sized enterprises here (possibly the big brands of tomorrow). Although, that said, a lot of the big brands are there too. Except for the luxury retailers that is, who are still holding their noses.

The company has also integrated gamification, influencers and real-world events like concerts featuring the likes of Dua Lipa into its app. These tools are already embraced wildly by consumers in China and are coming here next. Think Singles Day – now the biggest online shopping event in the world – on steroids.

Lazada claims all of this will help it, and the new brands being built on its platform, to harvest rich customer data that is indicative of buyer behaviour and trends.

For we know that parent company Alibaba’s gross merchandise value of products sold through its platforms is in excess of $485 billion. More than Amazon. More than Walmart. It is, without a doubt, the world’s largest retailer.

Lazada, therefore, does indeed have the critical mass behind it to rule South East Asia (it says it has no global ambitions due to competition in other markets from Amazon and its own parent company). It could still be losing hundreds of millions a year, as it was before the Alibaba acquisition in 2016. However, if so, that’s at least partly due to it building its own supply chain and investing for growth in tangible assets like warehouses, planes, ships and so on.

Here I want to reference for a minute marketing Professor Scott Galloway’s crucial list (from his truly brilliant book ‘The Four”) where he talks about the ingredients that are needed to build a company with a trillion-dollar valuation.

Lazada and its parent company Alibaba have the capital, the products, the regional reach, a degree of likability, vertical integration (even the idea of buying finance products on the app has been floated), the technology, the accelerant of top talent on their exec team and the geographical advantage; with Lazada’s Singapore headquarters being in SE Asia’s true business hub and Alibaba dominating in China’s mind-bogglingly massive market.

Indeed, Lazada Group president Jing Yin told me: “We want to be the incubator for new brands in South East Asia. It’s about giving the opportunity to the young dreamers.” In short, the ambition is to be the dominant home of brand building, just as TV once was back in the golden age of television.

So just maybe big tech platforms will be where the brand building of tomorrow gets done. Assuming that Elizabeth Warren doesn’t make it to POTUS status and then break up the alleged monopolies in America, as she has promised to do. A trend that would no doubt make its way to the shores of Asia over time.

The good news is that brand building has a future. It simply looks nothing like the past. So I guess all of us in media and marketing land should be thankful for small mercies and try our best to adapt to the new normal.

And before I go, I did promise to tell you about my telco experience. So here goes.

Around a month ago, we moved out from the city to Singapore’s suburbs. As a result, we signed up for a new telco contract. A set-top box was tardily delivered and we settled down to enjoy some Netflix and myriad news channels (as I said, I know it’s weird).

Just two weeks later, said set-top box overheated and stopped working. A new one was eventually delivered – the telco first asking if we could take it back to the store ourselves and pick up the replacement. As you can imagine, “no thanks” was the polite answer.

When the engineer finally came out to our home to do a diagnosis, he explained that the new (smaller than before) set-top box had been badly designed. There was no longer the proper amount of ventilation incorporated into the design. Therefore, the replacement was likely to overheat again.

“My suggestion is to buy a fan and direct it at the box whenever you are using it,” he helpfully told us. “No thanks” was once again the polite reply from our side. True to his word, the replacement set-top box also overheated within three weeks and developed the same fault as the one before.

No problem. Let’s call the customer service line we thought. On doing so, we were told by the robot on the other end that the waiting time to speak to the human customer service agent was up to 30 minutes. No matter we thought, let’s fill in the online form to get this sorted. It was a fairly easy process and we immediately got a response: “We have received your email and will get back to you within three working days.”

What responsiveness. What agility. What customer care. That’s exactly what we didn’t think. Why am I telling you this? Well, the reason is that said telco is now at minus five on the brand index in my view. The whole experience was the opposite of brand building. It was, in effect, brand demolition.

And I suspect I’m not alone in having this experience with said telco in Singapore. You can probably guess the brand, but buy me a coffee and I’ll tell you which one it was.

You probably won’t be surprised to learn that the same telco runs the most lavish TVCs around. Admittedly, some of them are pretty damn good thanks to the client choosing a great creative agency. Coffee won’t be enough this time mind, you’ll have to fork out for lunch to get the agency out of me.

Anyway, I digress. Back to the matter at hand.

What is my message to the telco brand in question? Learn from history before it’s too late. Complacency kills. You may have decades of solid business under your belt, but the Netflix and Lazadas of this world are hungry. So beware. They are coming for your breakfast, lunch and dinner.

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