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2016 Viewpoint
Trend: Impact: Action.
CONTACT
To talk to us about our viewpoint,
or to get our opinion on a sticky
brief you’re dealing with, contact
Richard Marshall, our Group CEO.
rmarshall@tmwunlimited.com
+44 (0)7802 814921
+44 (0)20 7349 4036
www.tmwunlimited.com
CONTENTS
Meet the team	 04
Diversity in advertising	 06
The future of mobile	 08
Privacy and
personalisation	 10
Retail transformation	 12
Data and creativity	 14
AI and robotics	 16
About TMW Unlimited	 18
With the cultural,
technological and
marketing landscapes
continuing to evolve
at pace, here are six key
trends we think will hit
2016 hard, and how you
can turn them to your
advantage.
Kate Wheaton
Director of Strategy
Welcome to TMW Unlimited’s 2016 viewpoint –
six essays on big topics that matter for marketers
now. These are thorny issues and trends that
have stimulated a lot of debate within the agency
and will undoubtedly continue to do so.
We start with the challenges of Diversity, where
we believe marketers need to stop worrying
about depiction and start taking a more active
role. We look to China as a model for the likely
future development of Mobile. We examine
the ambiguities in consumer behaviour and
the implications of narrowing only to what’s
‘relevant’ in Privacy and personalisation.
Looking at the future of Retail, we assess the
challenges facing major mass retailers, who look
increasingly out of step with smaller and more
agile businesses who can deliver fast against
evolving customer needs. In Data and creativity,
we explore the often complimentary relationship
between these two forces and the murky waters
they’re heading into. Finally we ask whether,
when it comes to AI and robotics, we are slowly
boiling the frogs of history, blissfully unconscious
of the role that AI already plays in our lives.
I hope you find our perspectives fresh and
thought-provoking – and that we can all look
forward to 2016 better equipped to meet
its challenges.
02 032016 Viewpoint Trend: Impact: Action.
César Valadares
Planner
Anna Foster
Data Director
Catherine Shaw
Data Planning Executive
Alex Willimott
Planner
Andrew Robinson
Senior Planner
Marc Curtis
Head of Labs
Ross Hawkes
Data Planner
Fred Brinton
Planner
Sophie Clutterham
Social Analyst
Elisabeth Fennes
Junior Planner
Sally Schumacher
Senior Data Planner
Charel Schmit
Data Planner
Kate Wheaton
Director of Strategy
Victoria White
Senior Planner
Richard Colvile
Junior Planner
Marsha Tunkel
Junior Planner
Oliver Betts
Senior Data Planner
Nick Owen
Social Analyst
Esme Noble
Planner
Olufemi Odewumi
Web Analyst
Simon Butcher
Planner
Adam Knight
Planning Director
Hema Chauhan
Marketing Manager
Meet the team...
Here’s everybody that contributed to one or more of the following thought pieces.
A real cross-section of our Planning and Data Strategy departments.
04 2016 Viewpoint Trend: Impact: Action. 05
Like a family reunion, it’s all relative.
A piece of brand communication that
looks refreshingly inclusive and
representative to one group, might easily
be called out for not being inclusive and
representative by another.
A LOSE/LOSE GAME
That sense of it being a ‘no-win game’ is part of the reason why
the responsibility to reflect social diversity sends shivers down the
marketer’s spine. Accurately mirroring the society you communicate
to can feel like an overwhelming political-correctness juggling act.
The prospect of looking patronising or tokenistic is just as daunting.
Whilst the fact that it may never be deemed to be inclusive by
everyone can be further disheartening. So whilst all marketers know
they need to do it, the acknowledgment of people of different race,
ethnicity, sexual orientation, socio-economic status, age, physical
ability, religious belief and so on, can understandably feel like a pretty
thorny, onerous task.
06
Areas of impact:
+ Brand Comms Strategy
+ Regionalisation of Advertising
+ Product Development
2016 Viewpoint Trend: Impact: Action.
Given that, ask a marketing manager if they’re ‘doing diversity’, and
they’ll probably explain that they definitely are. There’s a decent split
of men and women on the hero image of our homepage. There’s
a bit of a mix of ethnicities in some scenes of our TV ad. There’s a
disabled guy in one of our promoted social posts. That’s all fantastic,
constitutes significant progress from where we have been as an
industry, and is certainly to be applauded. But, no, it isn’t enough.
CATERING FOR THE WHOLE FAMILY
In 2016 and beyond, we will increasingly see brands going beyond
depiction of diversity, towards actually catering for diversity. Rather
than just picturing a Muslim family around the dinner table, food
brands will start thinking what Ramadan could mean for them
when it comes to campaign activations. What is the constructive
messaging or service a food brand could provide to make
themselves useful or relevant to the millions of potential consumers
who mark that event? Or, similarly, rather than just depicting an
Indian guy using their product, consumer electronics brands will start
thinking about what the Holi festival of colour could mean to them.
But it’ll go beyond campaign activations to products and services
too. And that’s why sportswear brands will go beyond just depicting
religious diversity in their communications and begin catering for
women who wear hijabs with appropriate lightweight sports clothing.
Catering for diversity, both in communication and product offerings,
can easily hit wide of the mark, however. And it leaves a particularly
sour taste when it does. When John Lewis stocked “pencils for
her”, which featured supposedly inspiring lines such as “buy the
shoes, “glamorous” and “glitter and bling”, they were deservedly
subjected to widespread ridicule. But when Beyoncé released an
almost identical range of pink pencils, featuring her song lyrics such
as “flawless”, “crazy in love” and “bootylicious”, there was no such
backlash. The slight, but important, nuance that differentiates the
two, lies at the heart of how brands need to navigate marketing to
traditionally under-represented groups.
Whilst the former was positioned as “for women”, the latter was
positioned as “from Beyoncé”. The intended target consumer is the
same. And what’s actually on offer to the consumer is otherwise
pretty much indistinguishable. But whilst being told that something
is for you can feel condescending, being told that it’s from someone
allows the consumer to come to their own conclusion where it’s
relevant for them. No-one wants to be labelled. But when brands
start really catering for minority groups, it will become more
imperative than ever to avoid labelling products as for those groups.
Being clever about whom it’s from – particularly through partnerships
and endorsements – is one way brands will prompt minority groups
to easily identify with a relevant product, without patronisingly
spelling it out.
A PLAN FOR THE FUTURE
2016 will be the year when some brands go beyond fretting about
representation of diversity. While others still have plenty of catching
up to do on that front, a select few will start actually catering for
diversity with products, communications and campaign moments
geared towards large minorities. In the same way that depiction of
diversity has become the right thing to do for your bottom line, not
just for social responsibility, it’s only a matter of time until actively
catering for diversity follows suit. But as we enter this new stage of
how brands ‘do’ diversity, we need to be wary of explicitly labelling
who it’s for, and let consumers come to that judgment themselves.
Diversity in advertising.
Is representing diversity in
advertising ever enough?
DEPICTING DIVERSITY
But as brands increasingly try to depict diversity as faithfully as
possible, it’s easy to forget that just visually representing a diverse
society isn’t the end point. Sure, it’s great that the faces in our end-
frames are looking less homogenous than was once the case, but
brands shouldn’t be stopping there. Arguably, it’s not even the most
important thing for brands to consider when it comes to diversity.
If brands embrace the next stage of how to ‘do’ diversity, then that
juggling act of mirroring a patchwork society accurately will actually
start feeling a little less thorny, and a little less onerous.
Before peeking at what that next stage is, it’s worth reflecting for a
moment on where we are now. Although many brands still haven’t
arrived at the party yet, we’re increasingly used to seeing guys in
wheelchairs in Guinness commercials, same-sex couples in Banana
Republic marketing, businessmen who aren’t necessarily white in
banking ads, or a nonchalant same-sex kiss in a Lynx video. Of
course, for every example here, there’s another brand that still can’t
quite see past the 1950s-style white, middle-class families around
the dinner table. But clearly there’s a shift occurring – not just
because it’s the ‘right’ thing to do, but because that bottom line just
can’t afford for vast swathes of potential consumers to feel alienated
or disregarded by the brand.
07
THE PROLIFERATION OF THE ENTREPRENEUR
Another significant change is the rise of ‘always on’ entrepreneurs.
Word of mouth has always been a key driver for shoppers in China,
with 2/3 of consumers ranking it as the critical factor in purchase
decisions. However, change is afoot. With m-commerce capabilities
in the same platform as social tools it is now a simple step for
influencers (or anyone) to turn their social presence into a direct
retail presence. As a consequence, peer-to-peer retail makes
up a staggering 50% of e-commerce volume in China.
SOCIAL NETWORKS BECOME INVISIBLE TRIBES
China has also seen a change in what consumers expect from
their social networks. In the early days, users enjoyed the world
of mass fragmented information, following celebrities and people
they didn’t really know. However, they have now moved to a more
filtered approach, in favour of closed networks such as WeChat,
where consumers organise themselves in smaller purpose-
focused tribes. This style of communication is now so popular
it is the preferred choice for any communication, including
CRM communications from brands (above email).
WHY THIS MATTERS FOR THE UK
So, why is this relevant to the UK? The answer is simple. Whilst
smartphone penetration surpasses that of China, consumer behaviour
is years behind. 2016 will be the year when we start to catch up.
A key factor in our late-changing behaviour is the lack of a strong
mobile payment proposition. 2016 promises a step change here
as Apple Pay starts to take hold for iPhone users, and the likes
of Google, PayPal and Visa try to respond.
Social behaviour is changing too, as the trend away from traditional
social platforms and towards chat-based apps continues. Facebook
was quick to pick up on this and has been investing aggressively,
buying WhatsApp for a cool $19 billion and separating out Facebook
Messenger as a standalone app.
But Facebook’s ambition is bigger in this space as it ramps up its
chat app capabilities to be more akin to that of WeChat. It currently
includes video and voice calls, peer-to-peer payments and location
sharing. Future plans are focused around connecting consumers
directly with brand services, e-commerce services and customer
services directly in the chat environment, opening up a radically
different one-to-one customer experience between consumers and
brands. It’s already taken the first steps here, launching a partnership
with Uber in the US to book taxis in-app and similar partnership with
KLM set to launch early in 2016.
WHAT NEEDS TO HAPPEN IN 2016?
M-COMMERCE AND OFFLINE TO ONLINE
E-commerce continues to increase in the UK, but to prepare for the
change in consumer behaviour driven by the adoption of m-wallets,
brands need to make sure their m-commerce capabilities are truly
up to scratch.
It’s also the time to get serious about the changing nature of the
retail environment. While QR codes are unlikely to rise from the
ashes, new discrete invisible technologies such as audio beacons
offer new ways for brands to make the connection between the
real and virtual worlds.
THE PROLIFERATION OF THE ENTREPRENEUR
In our new age of austerity, one in seven people in the UK are
registered as being self-employed and it seems that this new model
of work is here to stay. Brands should think about how they can
create a networked sales force and support them to sell amongst
their family and friends through digital platforms.
SOCIAL NETWORKS BECOME INVISIBLE TRIBES
The continued shift towards chat-based social apps will impact
brands’ social strategies. Rather than a traditional focus on building
communities, brands need to focus on how they can create compelling
must-watch content that can travel through closed networks.
Whilst China has laid a seemingly obvious path for the West to
follow, the different cultural and political contexts do not guarantee
the same end result.
But one thing is for sure. The brands that succeed in this bold new
world will be the brands that start to prepare now for the next leap
in the evolution of mobile.
China has over 1.2 billion registered mobile users
and a smartphone penetration rate of over 60%.
Mobile is blazing ahead as web traffic from
handsets rises 136% year-on-year whilst that
of laptops/desktops has fallen by 29%.
But it is not the just the volumes and share of web traffic that makes
China a supreme example of a mobile-first nation; it is the breadth
of services offered by the two biggest players which places them
ahead of their Western counter parts.
WeChat and Alibaba, valued at over $80 billion and $200 billion
respectively are competing to become the default all-encompassing
platform. Combining mobile payments, ticketing, banking, transport
booking, location services, QR code readers, social networking,
publishing/blogging, online retail as well as a plethora of third party
apps into one platform allows Chinese consumers to leap ahead
in mobile-first consumer behaviour.
IMPACT ON CONSUMER BEHAVIOUR
Mobile has driven some profound changes in consumer behaviour
which is shaping how consumers transact and interact with each
other and with brands.
ONLINE TO OFFLINE AND THE DEATH OF RETAIL
M-commerce accounted for half of all consumer e-commerce
in China in 2015. This represents an increase of 85% from the
year before. The rapid adoption of the mobile wallet has had a
devastating effect on the retail environment. Suddenly, consumers
are able to shop at their convenience, anytime and anywhere, which
is driving consumers out of store as they transact on their handsets.
Retailers are fighting back with O2O (offline to online) strategies
which aim to engage consumers in the real world to transact in
the mobile world. In China, the glue that bridges these worlds is the
QR code. Though they never gained traction in the UK, having the
capability within the WeChat and Alibaba platforms has put the
technology in the hand of every consumer and allowed brands to
closely link it to their m-commerce presence. Brands in China are
now focused on creating engaging physical brand experiences or
sales promotions in retail which capture consumer attention and then
drive consumers to transact online.
The future of mobile.
It takes about 10 hours
to get from London to
Beijing. But looking at
how Chinese consumers
use mobile, you’d be
forgiven for thinking
that you’re worlds away...
08
Areas of impact:
+ Retail
+ Social Media
+ Finance and Banking
2016 Viewpoint Trend: Impact: Action. 09
Privacy and personalisation.
I didn’t ask for that, but I
want it: The fickle consumer
and how to serve them.
10
Areas of impact:
+ Content Delivery
+ Direct Marketing
+ Retargeting and Programmatic
2016 Viewpoint Trend: Impact: Action.
Whilst concern over privacy is on the rise, 44% of UK consumers say they would give up
personal information for free products and services. The trade-off for consumers to provide
more and more of their personal information to brands appears to be bespoke, relevant and
valuable content. But how do brands find that perfect balance and at what point does that
content shift from being useful to being intrusive, dull and predictive?
As consumers we’re constantly giving away our personal details
to brands in exchange for services and content. The price we
seem willing to pay for the most relevant offers or most convenient
application appears to be our digital identity.
On the other hand we’re growing tired with being re-targeted for
products we don’t want and have to suffer constant, apparently
highly targeted advertising, in our consumption of digital media.
How will this desire for bespoke and highly relevant services resolve
itself against the idea that brands are misusing our data, which we
didn’t know they had?
Projecting to the future, it can feel like two scenarios are possible:
1.	Marketers’ doomsday – a world where consumers guard their
privacy fiercely and block ads in all channels, reducing the ability
of marketers to reach audiences
2.	Marketers’ nirvana – a world of data and machine-led
personalisation proliferation, where every touchpoint a consumer
sees or interacts with is targeted to be hyper-relevant
Both, of course, are unrealistic projections – and at their heart
fail to recognise some fundamental truths about human beings.
11
DOOMSDAY ISN’T AROUND THE CORNER
Consumers are actually highly intelligent and intuitive but also lazy.
Our knowledge about what companies do with our data is often
very limited, but we rely on our instinct about brands, particularly
if we know and trust them, and give them access to our data as
we expect them to use it wisely.
Research into consumer attitudes into Marketing Data and
Consumer Privacy by SDL found that 75% of consumers in the UK
are more likely to provide personal information to a brand they trust.
If brands fail to look after our data, or exploit our trust, then surely
they will lose that precious commodity and we’ll vote with our feet.
A single brand failure though isn’t enough to start a stampede
towards guarding our privacy more closely. It would probably mean
we’d try to filter more carefully, but not take stock of the extent
to which our personal data is being used across the web. People
generally only react when it affects them directly and we’ve seen little
evidence of consumers starting to take steps to more closely guard
their personal information. Indeed, the TalkTalk data breach seems
only to have persuaded consumers that it’s the brand’s responsibility,
rather than theirs.
A UK parliamentary inquiry into the security of personal data online
was launched following the TalkTalk incident and early next year new
EU legislation will come into force which will update the seriously
outdated Data Protection Act of 1998. The new legislation will try to
ensure increased accountability for those processing personal data,
more robust reporting requirements around breaches and greater
portability of personal data from one service provider to another.
But what of the individual’s responsibility for their own data? We seem
prepared to make trade-offs around our data if we find the services
useful or the offers compelling. The SDL survey found that 60% of
consumers in the UK choose to do business with brands that use
personal data to make an experience better.
Google Now is a good example of this. Google collects huge
amounts of data about us and uses that data to ‘enhance’ our
experience of their products. Is anyone asking what information
they hold? It would seem that if the ‘experience’ offered by the
brand is strong and relevant, we’ll play along.
We also apply different criteria to different contexts and brands.
For example the use of iBeacons to drive personalised hands-on
service in a posh store like Neiman Marcus feels more appropriate
than it would in your local Tesco. In fact Tesco revealed plans to
install hi-tech screens in petrol stations to scan customer’s faces
in order to ‘enhance’ that customer experience, but it ultimately
led to claims of breaches of civil liberties.
We’ll always end up with a mixed future, not a black and white one.
Brands will need to rely on the things they have always done to be
valued and trusted by consumers such as having a clear purpose,
values that drive how the brand behaves, and delivering good value.
Yet all this could, and should, be based on understanding customers
deeply. Brands that fail to deliver will be found out.
AND MAYBE NIRVANA ISN’T REALLY
NIRVANA FOR CUSTOMERS
Privacy issues aside, we talk a lot about the benefits of
personalisation but is there also a downside? Does only ever seeing
things that a brand believes are relevant to you, based on your past
behaviour, actually end up becoming rather predictable and dull?
Could personalisation become something that consumers resent,
that pushes them more and more into a narrow predictable furrow?
So how do we, as consumers and as marketers avoid
getting locked in a cycle of repetition?
Personalisation as it currently exists is made possible by data,
patterns of purchase behaviour, and that behaviour is assessed
by computers, by algorithms with little understanding of human
behaviour. Little wonder then that suggested purchases are either
as a result of us being creatures of habit or are simply based on false
assumptions. Celia Walden in the Telegraph summed it up nicely:
‘Yes, I bought Paula Hawkins’ bestseller from you – and yes,
I read it. But who said I wanted more of the same?’
What happens to the things that excite us as human beings, the
unexpected and surprising? How do we factor in the things that invite
us to find out something new about the world or about ourselves?
Things that allow us to extend ourselves and push boundaries?
As so often, for brands, it has to be about balance. About ensuring
that consumers are assisted in their search for new products with
intelligent algorithms but also taking those chances to surprise and
delight in new avenues of opportunity. Somehow this needs to be built
into the formulae and it’s what Channel 4, as part of its development
of its 4oD on-demand platform are exploring with ‘the algorithm
of surprise’ as a way of pushing viewers to try something new.
INCREASINGLY DE-PERSONAL?
We are in an era of increasing capability in terms of machine
processing power, artificial intelligence and technological
innovation in delivery. Yet we are in danger of personalisation
becoming the norm, providing less differentiation and delivering
less competitive advantage.
Consumers are aware of the difference between what is
‘personalised’ and what is ‘personal’, and as personalisation
increases, will consumers more greatly value what is truly
personal even more deeply?
In research, consumers talk about missing the human touch,
especially from large companies who have invested in automation.
What consumers want is balance, convenient automation when it
suits them, human interaction when it’s relevant. Clever brands will
work out how to deliver sensitively against these conflicting needs
and demands, to recognise and pre-empt what consumers want
at different stages, at different times and in different contexts.
It won’t be easy, but data and insight are the key for brands to deliver
the three steps to consumer heaven; serve, surprise and delight.
EVOLVING THE WAY WE PAY
The arrival of contactless cards and Apple Pay removes the barriers
around how we pay. The prediction is that eventually we will shop
without taking our purses out of our bags or even having to carry a
debit or credit card at all.
Social shopping is growing with the evolution of buy buttons on
social networks, allowing shoppers to shop with friends without even
leaving the house.
START-UPS IN THE RETAIL SPACE
There’s much more exciting stuff happening, though mostly coming
from start-ups that focus on retail, particularly in the US. Much work
is being done around both providing a fully personalised shopping
experience as well as adding convenience to the purchase journey.
For example, there’s Enjoy, an online electronics retailer who delivers
products with an expert who will guide you through set-up and use.
And Instacart that will provide all the ingredients you need to cook a
specific recipe in an hour.
DO RETAILERS DO ENOUGH FOR THEIR
SHOPPERS?
But when it comes to the vast mass of retail, retailers arguably
haven’t progressed that much. Yes, there’s always lots of testing
and talking about stuff going on but how much is actually rolled
out and used by the average shopper? And how much has the
average shopping trip really changed in the last one, two or even
five years? Arguably not a lot with most shoppers still queueing to
pay, struggling to find their size or getting fed up and leaving hot,
crowded stores without having made a purchase.
The focus for most retailers is still on big events as sales-driving
mechanics rather than working out how to improve the shopper
experience. Look at the recent explosion of Black Friday in the UK.
Yes, it presents a short-term offer for shoppers, but in reality it’s all
about maximising sales.
But why is it difficult for the middle mass of retail to deliver real
change? Larger retailers may just not have the time, freedom or
inclination or there might be legacy issues which mean that making
what would appear to be a small change is actually a very big
challenge. Instead, most are stuck in a race for parity where it’s
more important to keep abreast with your competitors. Why invest in
delivering more when the ‘me toos’ will quickly follow and your point
of difference won’t really have much chance to deliver additional
footfall or accompanying sales.
In addition, shoppers have differing needs at differing times. We
are all complicated people, sometimes looking for functional and
quick shopper solutions, while at other times seeking out deep
personalised purchase experiences. In reality, it’s really hard for
retailers to react to this so in the absence of an ability to provide
mass personalisation, they focus on what they can deliver. This
leaves us in the situation where interesting stuff only happens to
answer retailer needs and they are not driven to change through
shopper needs.
So, to be blunt, mass retail still offers the majority of us a pretty
underwhelming experience, which doesn’t appear to be in danger of
changing very soon.
WHAT WILL MAKE THIS CHANGE?
At the moment it’s hard to see where a momentum for change will
come from. Brands just don’t have the power to affect retailers. And
you’d be forgiven for asking if it actually really matters. High streets
and supermarkets are still filled with shoppers purchasing the goods
they need and want.
THE PREDICTION
The prediction for 2016 is that shopping, rather than retail, will
change and not because of change driven by retailers. Instead
change will come from outside, from the arrival of the flexible,
agile start-up with a habit of identifying consumer pain points and
delivering against these in ways that are impossible for the major
players to do. Retailers themselves will continue to trial ideas, but
for the vast majority, shopping as a necessity or pastime will see no
notable change. That will only happen when shoppers vote with their
feet and take their money elsewhere.
Change is happening, but the biggest changes to the retail environment at the moment
are coming from outside forces. Retailers may be struggling to evolve and brands may
not have the power to drive change, but other organisations are taking control.
THE STORY SO FAR…
When it comes to trends in retail, we seem to have been having the
same discussion for the last few years.
On the more emotional side there’s the need to use retail space
to create memorable experiences and the requirement to offer a
personalised service to your customers. On the more functional side
there’s the ongoing demand for fast and convenient access to and
delivery of goods, as well as the need to ensure that all channels
work together to provide an omni-channel offering.
HEARD ALL THIS BEFORE?
If you have even a passing interest in retail marketing of course you
will have – again and again. But have you really seen any of them
in action? Burberry continues to steam ahead with retail innovation
and there are some great examples of flagship stores that create
fantastic integrated experiences. And we would argue that these
are trends that great small local retailers have been doing for a
while. For instance, a local off-licence chain near where one of
us lives continually offers a warm welcome, entertaining in-store
events, home delivery every Saturday afternoon as well as having an
excellent website and email communications.
Retail transformation.
Is 2016 finally the year
that retail will deliver?
12
Areas of impact:
+ FMCG
+ Fashion and Clothing
+ Mobile
2016 Viewpoint Trend: Impact: Action. 13
Gordon E. Moore has plenty to answer for. In 1975 he asserted that
semi-conductors would double in power every two years. It’s a
prediction that’s held pretty much true since, with exponentially faster,
smarter processors flying off the production lines.
Whether or not that’s because it was adopted as a self-fulfilling prophecy
for tech companies trying to prevent their own demise, or because he
was a bit of a genius doesn’t really matter. What does matter is that it’s
as true today as it was when he first said it.
So, how has that affected us as digital marketeers and advertisers?
Good question.
14
Areas of impact:
+ Digital Strategy
+ Corporate Infrastructure
+ Value Creation
2016 Viewpoint Trend: Impact: Action.
1990s: Getting to know each other – things change again as the
internet, mobile phones and database software arrive on the scene.
All embryonic, all misunderstood, all game-changing. Brands start to
play with various forms of tech, and WAP sites (remember those?)
are a ‘thing’ for about six months. An era of experimentation and
rapid learning about what does, and doesn’t, work.
2000s to 2015: Seeing each other regularly – digital advertising,
cookie tracking and behavioural analysis enable the beginnings of
behavioural targeting at site and network level. Brands now have the
ability to engage with prospects in a joined up and considered way.
Real-time bidding and programmatic enable marketeers to continue
to experiment and evolve.
*Source: www.knowyourapps.com/top100/
FRIENDS WITH BENEFITS
We believe that this pace of tech development has created a
similarly dynamic relationship between data and creativity.
A relationship that has delivered ever more technological sophistication
both in peoples’ daily lives, and the ways brands engage with them.
This relationship can be defined through its various eras – each
signifying a new way in which data and creativity became ever closer
bedfellows. If we stand back a little and take a peek at the last 115
years, we start to understand just how much times have changed:
1900s: The first meeting – in 1910 J. George Frederick created
his research company – the Business Bourse. Frederick identified
that companies at that time were pretty dismal at understanding
their customers, and using this to inform what they did. He created
the new arena of research and established the core use of data, as
insight, driving creativity over this past century.
1920s: A blossoming friendship – in 1917 the Direct Mail
Advertising Association launched to support the fledgling mail order
industry. This time consumer data was enabling brands to talk
directly to consumers. With Reader’s Digest as its poster child, the
industry rapidly expanded throughout the early 20th century.
1970s: The start of something – things bubbled away quite
nicely, and in 1967, Lester Wunderman coined the phrase “direct
marketing”, recognising an industry that had now reached
maturation. He also went on to create toll-free 1-800 numbers and
loyalty clubs for Columbia Records and American Express.
2016 AND BEYOND
We see 2016 as a defining moment in the relationship between
data and creativity. After a lovely first few years together, we’re
now entering a period that both defines and disrupts how data,
creativity and brands sit together, and who’s in charge. An era with
both positive and negative forces at play, and one that needs a
considered response to survive and thrive.
Firstly, consumers are gaining power, which is no bad thing. We
have a sword of Damocles in the threat of heavy-handed European
legislation. We’ve seen the emergence of ad-blocking software.
And we’ve also seen brands suffer newsworthy and bottom-line-
impacting data losses.
But there are green shoots of innovation across both new and
established platforms. Enabled by data and connectedness, but shaped
and delivered by clever brands playing their first-mover advantage.
All this suggests that we – both brands and agencies – have a lot to
do, both to keep pace with and capitalise on this ever developing
situation. So, here are five things we believe will be big in this space
throughout 2016:
1.	The need for relevance – ad blocking is forcing brands to
really think about who they’re talking to and what they’re saying.
Relevance is the watchword for 2016 – we must all ensure that what
we put in front of people is interesting, engaging and appropriate.
2.	Data guardianship and transparency – brands must build
robust walls around their precious data, and do everything they
can to avoid a dreaded data loss. But at the same time, they
need to give their customers better access to their own data,
allowing them to manage preferences and update information.
This feels like a bit of a ‘play it faster but do slow down’ brief, but
a pivotal one to get right.
3.	Marketing automation – since its arrival, it’s felt like a big, scary,
black box, only suitable for enterprise-sized organisations. But it’s
not anymore. Smart, simple platforms, clever rule creation, and
strong agency understanding, mean even modest-sized brands
can now set up automated communications frameworks that help
convert, retain and engage customers.
4.	Reduce the friction – this should be what data and digital is
all about. But so often it actually creates more, adding layers of
databases, logins and disconnected channels. At its best, data
can help smash down walls by creating services that make things
easier. Just think about Uber and the minicab industry. So focus on
reducing friction across all of your branded touchpoints – it will deliver
massive gains and put some smiles on your customers’ faces too.
5.	Real utility – of the top 100 apps in 2015*, only 9 were from
brands adding value or utility. If you take out Sky and the BBC,
it’d hardly be worth counting. Aside from the likes of Nike+
and Fiat Eco Drive, they’re pretty rare. But the value of creating
something in this space can be hugely disproportionate Vs the
investment. Take time to really think about how your brand can
return real value to your customers. Challenge your agency to
spend time generating utility-based ideas. And aim for the North
Star – a Nike+ sized idea that truly elevates your brand.
15
Data and creativity.
Cosy, flourishing but now
troubled. The evolving
relationship between
data and creativity.
AI and robotics.
We are the frogs of
history, enjoying a
slowly warming bath.
16
Areas of impact:
+ Home Automation
+ Measurement and Analytics
+ Human to Technology Interaction
If you drop a frog into boiling water it will try to jump
out. It will almost certainly not be a happy frog. Place a
frog in cold water and then slowly increase the heat, and
the frog will happily sit there while it boils to death. And so
it is with new technology.
As analogies go, this one is not the best – either for the frog
or for the reputation of emerging technology. What it does
illustrate though, is how incremental change can go almost
completely undetected. So it is with AI and robotics.
The pace of change in these areas is undeniably increasing,
but we are waiting for some kind of ‘revolution’ that we can
look back on as being a turning point in society’s journey to
AI and automation.
2016 Viewpoint Trend: Impact: Action.
The home is where robots will become the most visible. Companies
like Amazon and Google, and start-ups like Jibo want us to place
voice-enabled hubs in our home to provide an interface with their
ecosystems and the wider web whilst giving us greater control over
our connected home. People are becoming less awkward about
talking to their technology – especially now that you don’t have to
repeat yourself eight times in order to open Internet Explorer (Dragon
Naturally Speaking, circa 1996).
Anthropomorphising voice interfaces by sticking on a couple of eyes
and a tilting head, might be the final step we need to feel properly
comfortable communicating with our technology in a natural manner.
DRIVERLESS CARS
Outside of the home and beyond the obvious medical and military
applications, the most obvious example of personal robotics will be
driverless cars. We will be spending large amounts of time sitting in a
robot whilst we carry on consuming content and conversing (maybe)
with our fellow passengers.
And off the back of robots in the home and robots on the road will be
data; terabytes and terabytes of data being produced every day. In some
ways we can’t imagine how data on our daily routines, our conversations,
the way we dress, the food we eat (and the way we prepare it!) might
be used. But when you consider that we are still in the early days of
programmatic, autonomous marketing systems, it’s not a huge leap to
imagine a world where consumers are served up a seamless narrative
of content and advertising (if the two will be considered entirely
separate) weaved into every facet of their personal lives.
Timely, contextually relevant suggestions can be made based on the
analysed data of a thousand consumers whose morning ablutions
matched your own, or whose journey to work consisted of the same
route, media and argument with the kids.
Having a conversation with your partner about buying a new car? The
personal robot within earshot may be capturing that and serving you
‘promoted’ updates to help you spend your money. And if you think
that people won’t be happy with Google listening to and monetising
our private conversations, remember we all seem pretty comfortable
with them doing it with our email. It’s all about the value exchange.
THE FUTURE IS ALREADY HERE, IT’S JUST
NOT VERY EVENLY DISTRIBUTED
You don’t have to imagine the impact of AI on marketing. Companies
like Phrasee have built algorithms that create original short-form copy
for email subject lines and banners that are many times more effective
than anything a human being can write. Countless analytics platforms
can derive meaning from the ocean of data that exists on public social
channels, enabling marketers to target micro-segments of society with
a high degree of accuracy.
The challenge for marketers with the possibilities that AI and robotics
open up for us is how to use it without freaking people out. Although
the fine line between utility and creepy is constantly shifting as
people become used to the technology.
We are the frogs of history, enjoying a slowly warming bath. By the
time we are aware of the impact AI has had on our lives, we’ll have
been living with it for a while.
We have been living with it for a while.
ARTIFICIAL NARROW INTELLIGENCE VS
ARTIFICIAL GENERAL INTELLIGENCE
John McCarthy, who coined the term “Artificial Intelligence” in 1956,
complained that “as soon as it works, no one calls it AI anymore.”
That’s the state of AI today – we are surrounded by systems that use
Artificial Narrow Intelligence (ANI). These are AIs that are created to
carry out specific complex tasks – for example chess computers,
driverless cars, the Facebook newsfeed algorithm, Siri, Amazon’s
Echo and Google Now.
And where you have ANI, you inevitably have robotics. The two
can never be entirely separate, robotics simply provides a container
for AI – especially where, in order to carry out its function, the ANI
requires some kind of bidirectional real-world interface.
ANIs are great at doing one thing – they can outperform a human in
a single task. But ask a chess computer to describe the difference
between a chair and a table and you’ll probably get a message
telling you that you tried to execute an illegal move.
By contrast, Artificial General Intelligence is flexible. It would be
able to adapt to different scenarios, learn rapidly and improve its
own performance. At present, we are still some way off achieving
this level of intelligence and balanced estimates put this particular
milestone as being passed within the next 10–20 years.
ANIs are here now, and they are tools of individuals and companies.
PERSONAL ROBOTICS – THE ANI IN
OUR LIVES
Personal robotics will put a face (or a body) on the already maturing
ANI technology. They provide a conversational link with digital content,
understanding what you want to see, when you want to see it and
then delivering it via an invisible interface – or voice, as we call it.
By providing our AIs with a broader and more useful sensorium,
enhanced by the fact of their physical presence and mobility, our
robots will be aware of all of the nuances of our lives in much greater
resolution that we can imagine.
17
Creating the world’s
most influential work.
We’re a leading creative
marketing agency with
over 28 years’ experience
connecting brands with
consumers in innovative
and memorable ways.
Some recent work
18 2016 Viewpoint Trend: Impact: Action. 19
Based in Soho with over 260 talented agency
folk, we combine our skills in different ways,
blurring the line between creativity and
technology to produce brilliant, effective and
award-winning work that truly influences
people’s purchase decisions and behaviour.
Fully integrated and with strategy and creative at our heart, our
expertise covers the full spectrum of marketing communications.
We also have specialist teams in data, digital development,
technical innovation, relationship marketing, retail experience,
social and influencer marketing, marketing technology, content
and production services.
INTELLIGENT INFLUENCE
Emotion is at the heart of decision making. People feel, then they
do, then they think.
So we create influential ideas and experiences that unlock the power of
how people feel through a unique approach we call Intelligent Influence.
Using insight and data, Intelligent Influence helps our clients
create stronger and more meaningful long-term relationships with
their consumers.
INTERNATIONAL REACH
We have an agency network in 25 countries worldwide through our
partnership with Serviceplan International and work with some of the
biggest brands in the world delivering campaigns with global appeal.
UNLIMITED THINKING
We are part of a group brand offer called Creston Unlimited,
designed to solve the big and often complex client challenges of
today through Unlimited Thinking. Unlimited Thinking is centred
around impartial advice drawn from senior thought leadership
and expertise from across our group agencies.
Client
Virgin Trains
Campaign
Arrive Awesome
Our award-winning campaign for Virgin Trains saw us develop a
new bold brand positioning called Arrive Awesome designed to
make everyone fall back in love with train travel. The idea allowed
us to make every step of the customer journey awesome from
booking through to the on-board experience and post-journey,
and was translated across all touchpoints from TV through to
social, online and email.
Using data-driven insight and personalisation, our communications
deliver tailored content and relevant offers and resulted in £13.5m
incremental revenue in the first 12 months of our appointment.
Virgin Trains has now become a much loved and trusted brand,
with positive sentiment towards it in social media increasing threefold
– no mean feat in the world of train travel.
The campaign won gold at the 2015 DMA Awards in the Best Brand
Building category.
Client
Lynx
Campaign
Bigger Issues
To help Lynx grow up and appeal to an older audience, we aligned
the brand with a social cause that is both of huge importance to
young men, and will radically change how guys view the brand:
awareness of male suicide. Incredibly, suicide is the single biggest
killer of men in the UK under the age of 45.
Partnering with the male suicide charity CALM, we developed the
#BiggerIssues campaign, drawing attention to all the comparatively
trivial things that guys are talking about a lot more than suicide.
Across social media, digital banners and live digital OOH, we pulled
in whatever subject was dominating headlines and newsfeeds at
that moment to put the issue on people’s radar at an unprecedented
scale and in a provocative, uniquely Lynx way. Over a period of two
weeks, all digital creative was updated every two hours – the current
rate at which guys are killing themselves in the UK. To spread the
word, we engaged with key influencers such as Professor Green
and Stephen Fry and organised a ‘thunderclap’ – an automatically
scheduled collective post from registered people’s social media
accounts – which reached 23 million people around the world.

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TMWUnlimited_Viewpoint_2016

  • 1. 2016 Viewpoint Trend: Impact: Action. CONTACT To talk to us about our viewpoint, or to get our opinion on a sticky brief you’re dealing with, contact Richard Marshall, our Group CEO. rmarshall@tmwunlimited.com +44 (0)7802 814921 +44 (0)20 7349 4036 www.tmwunlimited.com
  • 2. CONTENTS Meet the team 04 Diversity in advertising 06 The future of mobile 08 Privacy and personalisation 10 Retail transformation 12 Data and creativity 14 AI and robotics 16 About TMW Unlimited 18 With the cultural, technological and marketing landscapes continuing to evolve at pace, here are six key trends we think will hit 2016 hard, and how you can turn them to your advantage. Kate Wheaton Director of Strategy Welcome to TMW Unlimited’s 2016 viewpoint – six essays on big topics that matter for marketers now. These are thorny issues and trends that have stimulated a lot of debate within the agency and will undoubtedly continue to do so. We start with the challenges of Diversity, where we believe marketers need to stop worrying about depiction and start taking a more active role. We look to China as a model for the likely future development of Mobile. We examine the ambiguities in consumer behaviour and the implications of narrowing only to what’s ‘relevant’ in Privacy and personalisation. Looking at the future of Retail, we assess the challenges facing major mass retailers, who look increasingly out of step with smaller and more agile businesses who can deliver fast against evolving customer needs. In Data and creativity, we explore the often complimentary relationship between these two forces and the murky waters they’re heading into. Finally we ask whether, when it comes to AI and robotics, we are slowly boiling the frogs of history, blissfully unconscious of the role that AI already plays in our lives. I hope you find our perspectives fresh and thought-provoking – and that we can all look forward to 2016 better equipped to meet its challenges. 02 032016 Viewpoint Trend: Impact: Action.
  • 3. César Valadares Planner Anna Foster Data Director Catherine Shaw Data Planning Executive Alex Willimott Planner Andrew Robinson Senior Planner Marc Curtis Head of Labs Ross Hawkes Data Planner Fred Brinton Planner Sophie Clutterham Social Analyst Elisabeth Fennes Junior Planner Sally Schumacher Senior Data Planner Charel Schmit Data Planner Kate Wheaton Director of Strategy Victoria White Senior Planner Richard Colvile Junior Planner Marsha Tunkel Junior Planner Oliver Betts Senior Data Planner Nick Owen Social Analyst Esme Noble Planner Olufemi Odewumi Web Analyst Simon Butcher Planner Adam Knight Planning Director Hema Chauhan Marketing Manager Meet the team... Here’s everybody that contributed to one or more of the following thought pieces. A real cross-section of our Planning and Data Strategy departments. 04 2016 Viewpoint Trend: Impact: Action. 05
  • 4. Like a family reunion, it’s all relative. A piece of brand communication that looks refreshingly inclusive and representative to one group, might easily be called out for not being inclusive and representative by another. A LOSE/LOSE GAME That sense of it being a ‘no-win game’ is part of the reason why the responsibility to reflect social diversity sends shivers down the marketer’s spine. Accurately mirroring the society you communicate to can feel like an overwhelming political-correctness juggling act. The prospect of looking patronising or tokenistic is just as daunting. Whilst the fact that it may never be deemed to be inclusive by everyone can be further disheartening. So whilst all marketers know they need to do it, the acknowledgment of people of different race, ethnicity, sexual orientation, socio-economic status, age, physical ability, religious belief and so on, can understandably feel like a pretty thorny, onerous task. 06 Areas of impact: + Brand Comms Strategy + Regionalisation of Advertising + Product Development 2016 Viewpoint Trend: Impact: Action. Given that, ask a marketing manager if they’re ‘doing diversity’, and they’ll probably explain that they definitely are. There’s a decent split of men and women on the hero image of our homepage. There’s a bit of a mix of ethnicities in some scenes of our TV ad. There’s a disabled guy in one of our promoted social posts. That’s all fantastic, constitutes significant progress from where we have been as an industry, and is certainly to be applauded. But, no, it isn’t enough. CATERING FOR THE WHOLE FAMILY In 2016 and beyond, we will increasingly see brands going beyond depiction of diversity, towards actually catering for diversity. Rather than just picturing a Muslim family around the dinner table, food brands will start thinking what Ramadan could mean for them when it comes to campaign activations. What is the constructive messaging or service a food brand could provide to make themselves useful or relevant to the millions of potential consumers who mark that event? Or, similarly, rather than just depicting an Indian guy using their product, consumer electronics brands will start thinking about what the Holi festival of colour could mean to them. But it’ll go beyond campaign activations to products and services too. And that’s why sportswear brands will go beyond just depicting religious diversity in their communications and begin catering for women who wear hijabs with appropriate lightweight sports clothing. Catering for diversity, both in communication and product offerings, can easily hit wide of the mark, however. And it leaves a particularly sour taste when it does. When John Lewis stocked “pencils for her”, which featured supposedly inspiring lines such as “buy the shoes, “glamorous” and “glitter and bling”, they were deservedly subjected to widespread ridicule. But when Beyoncé released an almost identical range of pink pencils, featuring her song lyrics such as “flawless”, “crazy in love” and “bootylicious”, there was no such backlash. The slight, but important, nuance that differentiates the two, lies at the heart of how brands need to navigate marketing to traditionally under-represented groups. Whilst the former was positioned as “for women”, the latter was positioned as “from Beyoncé”. The intended target consumer is the same. And what’s actually on offer to the consumer is otherwise pretty much indistinguishable. But whilst being told that something is for you can feel condescending, being told that it’s from someone allows the consumer to come to their own conclusion where it’s relevant for them. No-one wants to be labelled. But when brands start really catering for minority groups, it will become more imperative than ever to avoid labelling products as for those groups. Being clever about whom it’s from – particularly through partnerships and endorsements – is one way brands will prompt minority groups to easily identify with a relevant product, without patronisingly spelling it out. A PLAN FOR THE FUTURE 2016 will be the year when some brands go beyond fretting about representation of diversity. While others still have plenty of catching up to do on that front, a select few will start actually catering for diversity with products, communications and campaign moments geared towards large minorities. In the same way that depiction of diversity has become the right thing to do for your bottom line, not just for social responsibility, it’s only a matter of time until actively catering for diversity follows suit. But as we enter this new stage of how brands ‘do’ diversity, we need to be wary of explicitly labelling who it’s for, and let consumers come to that judgment themselves. Diversity in advertising. Is representing diversity in advertising ever enough? DEPICTING DIVERSITY But as brands increasingly try to depict diversity as faithfully as possible, it’s easy to forget that just visually representing a diverse society isn’t the end point. Sure, it’s great that the faces in our end- frames are looking less homogenous than was once the case, but brands shouldn’t be stopping there. Arguably, it’s not even the most important thing for brands to consider when it comes to diversity. If brands embrace the next stage of how to ‘do’ diversity, then that juggling act of mirroring a patchwork society accurately will actually start feeling a little less thorny, and a little less onerous. Before peeking at what that next stage is, it’s worth reflecting for a moment on where we are now. Although many brands still haven’t arrived at the party yet, we’re increasingly used to seeing guys in wheelchairs in Guinness commercials, same-sex couples in Banana Republic marketing, businessmen who aren’t necessarily white in banking ads, or a nonchalant same-sex kiss in a Lynx video. Of course, for every example here, there’s another brand that still can’t quite see past the 1950s-style white, middle-class families around the dinner table. But clearly there’s a shift occurring – not just because it’s the ‘right’ thing to do, but because that bottom line just can’t afford for vast swathes of potential consumers to feel alienated or disregarded by the brand. 07
  • 5. THE PROLIFERATION OF THE ENTREPRENEUR Another significant change is the rise of ‘always on’ entrepreneurs. Word of mouth has always been a key driver for shoppers in China, with 2/3 of consumers ranking it as the critical factor in purchase decisions. However, change is afoot. With m-commerce capabilities in the same platform as social tools it is now a simple step for influencers (or anyone) to turn their social presence into a direct retail presence. As a consequence, peer-to-peer retail makes up a staggering 50% of e-commerce volume in China. SOCIAL NETWORKS BECOME INVISIBLE TRIBES China has also seen a change in what consumers expect from their social networks. In the early days, users enjoyed the world of mass fragmented information, following celebrities and people they didn’t really know. However, they have now moved to a more filtered approach, in favour of closed networks such as WeChat, where consumers organise themselves in smaller purpose- focused tribes. This style of communication is now so popular it is the preferred choice for any communication, including CRM communications from brands (above email). WHY THIS MATTERS FOR THE UK So, why is this relevant to the UK? The answer is simple. Whilst smartphone penetration surpasses that of China, consumer behaviour is years behind. 2016 will be the year when we start to catch up. A key factor in our late-changing behaviour is the lack of a strong mobile payment proposition. 2016 promises a step change here as Apple Pay starts to take hold for iPhone users, and the likes of Google, PayPal and Visa try to respond. Social behaviour is changing too, as the trend away from traditional social platforms and towards chat-based apps continues. Facebook was quick to pick up on this and has been investing aggressively, buying WhatsApp for a cool $19 billion and separating out Facebook Messenger as a standalone app. But Facebook’s ambition is bigger in this space as it ramps up its chat app capabilities to be more akin to that of WeChat. It currently includes video and voice calls, peer-to-peer payments and location sharing. Future plans are focused around connecting consumers directly with brand services, e-commerce services and customer services directly in the chat environment, opening up a radically different one-to-one customer experience between consumers and brands. It’s already taken the first steps here, launching a partnership with Uber in the US to book taxis in-app and similar partnership with KLM set to launch early in 2016. WHAT NEEDS TO HAPPEN IN 2016? M-COMMERCE AND OFFLINE TO ONLINE E-commerce continues to increase in the UK, but to prepare for the change in consumer behaviour driven by the adoption of m-wallets, brands need to make sure their m-commerce capabilities are truly up to scratch. It’s also the time to get serious about the changing nature of the retail environment. While QR codes are unlikely to rise from the ashes, new discrete invisible technologies such as audio beacons offer new ways for brands to make the connection between the real and virtual worlds. THE PROLIFERATION OF THE ENTREPRENEUR In our new age of austerity, one in seven people in the UK are registered as being self-employed and it seems that this new model of work is here to stay. Brands should think about how they can create a networked sales force and support them to sell amongst their family and friends through digital platforms. SOCIAL NETWORKS BECOME INVISIBLE TRIBES The continued shift towards chat-based social apps will impact brands’ social strategies. Rather than a traditional focus on building communities, brands need to focus on how they can create compelling must-watch content that can travel through closed networks. Whilst China has laid a seemingly obvious path for the West to follow, the different cultural and political contexts do not guarantee the same end result. But one thing is for sure. The brands that succeed in this bold new world will be the brands that start to prepare now for the next leap in the evolution of mobile. China has over 1.2 billion registered mobile users and a smartphone penetration rate of over 60%. Mobile is blazing ahead as web traffic from handsets rises 136% year-on-year whilst that of laptops/desktops has fallen by 29%. But it is not the just the volumes and share of web traffic that makes China a supreme example of a mobile-first nation; it is the breadth of services offered by the two biggest players which places them ahead of their Western counter parts. WeChat and Alibaba, valued at over $80 billion and $200 billion respectively are competing to become the default all-encompassing platform. Combining mobile payments, ticketing, banking, transport booking, location services, QR code readers, social networking, publishing/blogging, online retail as well as a plethora of third party apps into one platform allows Chinese consumers to leap ahead in mobile-first consumer behaviour. IMPACT ON CONSUMER BEHAVIOUR Mobile has driven some profound changes in consumer behaviour which is shaping how consumers transact and interact with each other and with brands. ONLINE TO OFFLINE AND THE DEATH OF RETAIL M-commerce accounted for half of all consumer e-commerce in China in 2015. This represents an increase of 85% from the year before. The rapid adoption of the mobile wallet has had a devastating effect on the retail environment. Suddenly, consumers are able to shop at their convenience, anytime and anywhere, which is driving consumers out of store as they transact on their handsets. Retailers are fighting back with O2O (offline to online) strategies which aim to engage consumers in the real world to transact in the mobile world. In China, the glue that bridges these worlds is the QR code. Though they never gained traction in the UK, having the capability within the WeChat and Alibaba platforms has put the technology in the hand of every consumer and allowed brands to closely link it to their m-commerce presence. Brands in China are now focused on creating engaging physical brand experiences or sales promotions in retail which capture consumer attention and then drive consumers to transact online. The future of mobile. It takes about 10 hours to get from London to Beijing. But looking at how Chinese consumers use mobile, you’d be forgiven for thinking that you’re worlds away... 08 Areas of impact: + Retail + Social Media + Finance and Banking 2016 Viewpoint Trend: Impact: Action. 09
  • 6. Privacy and personalisation. I didn’t ask for that, but I want it: The fickle consumer and how to serve them. 10 Areas of impact: + Content Delivery + Direct Marketing + Retargeting and Programmatic 2016 Viewpoint Trend: Impact: Action. Whilst concern over privacy is on the rise, 44% of UK consumers say they would give up personal information for free products and services. The trade-off for consumers to provide more and more of their personal information to brands appears to be bespoke, relevant and valuable content. But how do brands find that perfect balance and at what point does that content shift from being useful to being intrusive, dull and predictive? As consumers we’re constantly giving away our personal details to brands in exchange for services and content. The price we seem willing to pay for the most relevant offers or most convenient application appears to be our digital identity. On the other hand we’re growing tired with being re-targeted for products we don’t want and have to suffer constant, apparently highly targeted advertising, in our consumption of digital media. How will this desire for bespoke and highly relevant services resolve itself against the idea that brands are misusing our data, which we didn’t know they had? Projecting to the future, it can feel like two scenarios are possible: 1. Marketers’ doomsday – a world where consumers guard their privacy fiercely and block ads in all channels, reducing the ability of marketers to reach audiences 2. Marketers’ nirvana – a world of data and machine-led personalisation proliferation, where every touchpoint a consumer sees or interacts with is targeted to be hyper-relevant Both, of course, are unrealistic projections – and at their heart fail to recognise some fundamental truths about human beings. 11 DOOMSDAY ISN’T AROUND THE CORNER Consumers are actually highly intelligent and intuitive but also lazy. Our knowledge about what companies do with our data is often very limited, but we rely on our instinct about brands, particularly if we know and trust them, and give them access to our data as we expect them to use it wisely. Research into consumer attitudes into Marketing Data and Consumer Privacy by SDL found that 75% of consumers in the UK are more likely to provide personal information to a brand they trust. If brands fail to look after our data, or exploit our trust, then surely they will lose that precious commodity and we’ll vote with our feet. A single brand failure though isn’t enough to start a stampede towards guarding our privacy more closely. It would probably mean we’d try to filter more carefully, but not take stock of the extent to which our personal data is being used across the web. People generally only react when it affects them directly and we’ve seen little evidence of consumers starting to take steps to more closely guard their personal information. Indeed, the TalkTalk data breach seems only to have persuaded consumers that it’s the brand’s responsibility, rather than theirs. A UK parliamentary inquiry into the security of personal data online was launched following the TalkTalk incident and early next year new EU legislation will come into force which will update the seriously outdated Data Protection Act of 1998. The new legislation will try to ensure increased accountability for those processing personal data, more robust reporting requirements around breaches and greater portability of personal data from one service provider to another. But what of the individual’s responsibility for their own data? We seem prepared to make trade-offs around our data if we find the services useful or the offers compelling. The SDL survey found that 60% of consumers in the UK choose to do business with brands that use personal data to make an experience better. Google Now is a good example of this. Google collects huge amounts of data about us and uses that data to ‘enhance’ our experience of their products. Is anyone asking what information they hold? It would seem that if the ‘experience’ offered by the brand is strong and relevant, we’ll play along. We also apply different criteria to different contexts and brands. For example the use of iBeacons to drive personalised hands-on service in a posh store like Neiman Marcus feels more appropriate than it would in your local Tesco. In fact Tesco revealed plans to install hi-tech screens in petrol stations to scan customer’s faces in order to ‘enhance’ that customer experience, but it ultimately led to claims of breaches of civil liberties. We’ll always end up with a mixed future, not a black and white one. Brands will need to rely on the things they have always done to be valued and trusted by consumers such as having a clear purpose, values that drive how the brand behaves, and delivering good value. Yet all this could, and should, be based on understanding customers deeply. Brands that fail to deliver will be found out. AND MAYBE NIRVANA ISN’T REALLY NIRVANA FOR CUSTOMERS Privacy issues aside, we talk a lot about the benefits of personalisation but is there also a downside? Does only ever seeing things that a brand believes are relevant to you, based on your past behaviour, actually end up becoming rather predictable and dull? Could personalisation become something that consumers resent, that pushes them more and more into a narrow predictable furrow? So how do we, as consumers and as marketers avoid getting locked in a cycle of repetition? Personalisation as it currently exists is made possible by data, patterns of purchase behaviour, and that behaviour is assessed by computers, by algorithms with little understanding of human behaviour. Little wonder then that suggested purchases are either as a result of us being creatures of habit or are simply based on false assumptions. Celia Walden in the Telegraph summed it up nicely: ‘Yes, I bought Paula Hawkins’ bestseller from you – and yes, I read it. But who said I wanted more of the same?’ What happens to the things that excite us as human beings, the unexpected and surprising? How do we factor in the things that invite us to find out something new about the world or about ourselves? Things that allow us to extend ourselves and push boundaries? As so often, for brands, it has to be about balance. About ensuring that consumers are assisted in their search for new products with intelligent algorithms but also taking those chances to surprise and delight in new avenues of opportunity. Somehow this needs to be built into the formulae and it’s what Channel 4, as part of its development of its 4oD on-demand platform are exploring with ‘the algorithm of surprise’ as a way of pushing viewers to try something new. INCREASINGLY DE-PERSONAL? We are in an era of increasing capability in terms of machine processing power, artificial intelligence and technological innovation in delivery. Yet we are in danger of personalisation becoming the norm, providing less differentiation and delivering less competitive advantage. Consumers are aware of the difference between what is ‘personalised’ and what is ‘personal’, and as personalisation increases, will consumers more greatly value what is truly personal even more deeply? In research, consumers talk about missing the human touch, especially from large companies who have invested in automation. What consumers want is balance, convenient automation when it suits them, human interaction when it’s relevant. Clever brands will work out how to deliver sensitively against these conflicting needs and demands, to recognise and pre-empt what consumers want at different stages, at different times and in different contexts. It won’t be easy, but data and insight are the key for brands to deliver the three steps to consumer heaven; serve, surprise and delight.
  • 7. EVOLVING THE WAY WE PAY The arrival of contactless cards and Apple Pay removes the barriers around how we pay. The prediction is that eventually we will shop without taking our purses out of our bags or even having to carry a debit or credit card at all. Social shopping is growing with the evolution of buy buttons on social networks, allowing shoppers to shop with friends without even leaving the house. START-UPS IN THE RETAIL SPACE There’s much more exciting stuff happening, though mostly coming from start-ups that focus on retail, particularly in the US. Much work is being done around both providing a fully personalised shopping experience as well as adding convenience to the purchase journey. For example, there’s Enjoy, an online electronics retailer who delivers products with an expert who will guide you through set-up and use. And Instacart that will provide all the ingredients you need to cook a specific recipe in an hour. DO RETAILERS DO ENOUGH FOR THEIR SHOPPERS? But when it comes to the vast mass of retail, retailers arguably haven’t progressed that much. Yes, there’s always lots of testing and talking about stuff going on but how much is actually rolled out and used by the average shopper? And how much has the average shopping trip really changed in the last one, two or even five years? Arguably not a lot with most shoppers still queueing to pay, struggling to find their size or getting fed up and leaving hot, crowded stores without having made a purchase. The focus for most retailers is still on big events as sales-driving mechanics rather than working out how to improve the shopper experience. Look at the recent explosion of Black Friday in the UK. Yes, it presents a short-term offer for shoppers, but in reality it’s all about maximising sales. But why is it difficult for the middle mass of retail to deliver real change? Larger retailers may just not have the time, freedom or inclination or there might be legacy issues which mean that making what would appear to be a small change is actually a very big challenge. Instead, most are stuck in a race for parity where it’s more important to keep abreast with your competitors. Why invest in delivering more when the ‘me toos’ will quickly follow and your point of difference won’t really have much chance to deliver additional footfall or accompanying sales. In addition, shoppers have differing needs at differing times. We are all complicated people, sometimes looking for functional and quick shopper solutions, while at other times seeking out deep personalised purchase experiences. In reality, it’s really hard for retailers to react to this so in the absence of an ability to provide mass personalisation, they focus on what they can deliver. This leaves us in the situation where interesting stuff only happens to answer retailer needs and they are not driven to change through shopper needs. So, to be blunt, mass retail still offers the majority of us a pretty underwhelming experience, which doesn’t appear to be in danger of changing very soon. WHAT WILL MAKE THIS CHANGE? At the moment it’s hard to see where a momentum for change will come from. Brands just don’t have the power to affect retailers. And you’d be forgiven for asking if it actually really matters. High streets and supermarkets are still filled with shoppers purchasing the goods they need and want. THE PREDICTION The prediction for 2016 is that shopping, rather than retail, will change and not because of change driven by retailers. Instead change will come from outside, from the arrival of the flexible, agile start-up with a habit of identifying consumer pain points and delivering against these in ways that are impossible for the major players to do. Retailers themselves will continue to trial ideas, but for the vast majority, shopping as a necessity or pastime will see no notable change. That will only happen when shoppers vote with their feet and take their money elsewhere. Change is happening, but the biggest changes to the retail environment at the moment are coming from outside forces. Retailers may be struggling to evolve and brands may not have the power to drive change, but other organisations are taking control. THE STORY SO FAR… When it comes to trends in retail, we seem to have been having the same discussion for the last few years. On the more emotional side there’s the need to use retail space to create memorable experiences and the requirement to offer a personalised service to your customers. On the more functional side there’s the ongoing demand for fast and convenient access to and delivery of goods, as well as the need to ensure that all channels work together to provide an omni-channel offering. HEARD ALL THIS BEFORE? If you have even a passing interest in retail marketing of course you will have – again and again. But have you really seen any of them in action? Burberry continues to steam ahead with retail innovation and there are some great examples of flagship stores that create fantastic integrated experiences. And we would argue that these are trends that great small local retailers have been doing for a while. For instance, a local off-licence chain near where one of us lives continually offers a warm welcome, entertaining in-store events, home delivery every Saturday afternoon as well as having an excellent website and email communications. Retail transformation. Is 2016 finally the year that retail will deliver? 12 Areas of impact: + FMCG + Fashion and Clothing + Mobile 2016 Viewpoint Trend: Impact: Action. 13
  • 8. Gordon E. Moore has plenty to answer for. In 1975 he asserted that semi-conductors would double in power every two years. It’s a prediction that’s held pretty much true since, with exponentially faster, smarter processors flying off the production lines. Whether or not that’s because it was adopted as a self-fulfilling prophecy for tech companies trying to prevent their own demise, or because he was a bit of a genius doesn’t really matter. What does matter is that it’s as true today as it was when he first said it. So, how has that affected us as digital marketeers and advertisers? Good question. 14 Areas of impact: + Digital Strategy + Corporate Infrastructure + Value Creation 2016 Viewpoint Trend: Impact: Action. 1990s: Getting to know each other – things change again as the internet, mobile phones and database software arrive on the scene. All embryonic, all misunderstood, all game-changing. Brands start to play with various forms of tech, and WAP sites (remember those?) are a ‘thing’ for about six months. An era of experimentation and rapid learning about what does, and doesn’t, work. 2000s to 2015: Seeing each other regularly – digital advertising, cookie tracking and behavioural analysis enable the beginnings of behavioural targeting at site and network level. Brands now have the ability to engage with prospects in a joined up and considered way. Real-time bidding and programmatic enable marketeers to continue to experiment and evolve. *Source: www.knowyourapps.com/top100/ FRIENDS WITH BENEFITS We believe that this pace of tech development has created a similarly dynamic relationship between data and creativity. A relationship that has delivered ever more technological sophistication both in peoples’ daily lives, and the ways brands engage with them. This relationship can be defined through its various eras – each signifying a new way in which data and creativity became ever closer bedfellows. If we stand back a little and take a peek at the last 115 years, we start to understand just how much times have changed: 1900s: The first meeting – in 1910 J. George Frederick created his research company – the Business Bourse. Frederick identified that companies at that time were pretty dismal at understanding their customers, and using this to inform what they did. He created the new arena of research and established the core use of data, as insight, driving creativity over this past century. 1920s: A blossoming friendship – in 1917 the Direct Mail Advertising Association launched to support the fledgling mail order industry. This time consumer data was enabling brands to talk directly to consumers. With Reader’s Digest as its poster child, the industry rapidly expanded throughout the early 20th century. 1970s: The start of something – things bubbled away quite nicely, and in 1967, Lester Wunderman coined the phrase “direct marketing”, recognising an industry that had now reached maturation. He also went on to create toll-free 1-800 numbers and loyalty clubs for Columbia Records and American Express. 2016 AND BEYOND We see 2016 as a defining moment in the relationship between data and creativity. After a lovely first few years together, we’re now entering a period that both defines and disrupts how data, creativity and brands sit together, and who’s in charge. An era with both positive and negative forces at play, and one that needs a considered response to survive and thrive. Firstly, consumers are gaining power, which is no bad thing. We have a sword of Damocles in the threat of heavy-handed European legislation. We’ve seen the emergence of ad-blocking software. And we’ve also seen brands suffer newsworthy and bottom-line- impacting data losses. But there are green shoots of innovation across both new and established platforms. Enabled by data and connectedness, but shaped and delivered by clever brands playing their first-mover advantage. All this suggests that we – both brands and agencies – have a lot to do, both to keep pace with and capitalise on this ever developing situation. So, here are five things we believe will be big in this space throughout 2016: 1. The need for relevance – ad blocking is forcing brands to really think about who they’re talking to and what they’re saying. Relevance is the watchword for 2016 – we must all ensure that what we put in front of people is interesting, engaging and appropriate. 2. Data guardianship and transparency – brands must build robust walls around their precious data, and do everything they can to avoid a dreaded data loss. But at the same time, they need to give their customers better access to their own data, allowing them to manage preferences and update information. This feels like a bit of a ‘play it faster but do slow down’ brief, but a pivotal one to get right. 3. Marketing automation – since its arrival, it’s felt like a big, scary, black box, only suitable for enterprise-sized organisations. But it’s not anymore. Smart, simple platforms, clever rule creation, and strong agency understanding, mean even modest-sized brands can now set up automated communications frameworks that help convert, retain and engage customers. 4. Reduce the friction – this should be what data and digital is all about. But so often it actually creates more, adding layers of databases, logins and disconnected channels. At its best, data can help smash down walls by creating services that make things easier. Just think about Uber and the minicab industry. So focus on reducing friction across all of your branded touchpoints – it will deliver massive gains and put some smiles on your customers’ faces too. 5. Real utility – of the top 100 apps in 2015*, only 9 were from brands adding value or utility. If you take out Sky and the BBC, it’d hardly be worth counting. Aside from the likes of Nike+ and Fiat Eco Drive, they’re pretty rare. But the value of creating something in this space can be hugely disproportionate Vs the investment. Take time to really think about how your brand can return real value to your customers. Challenge your agency to spend time generating utility-based ideas. And aim for the North Star – a Nike+ sized idea that truly elevates your brand. 15 Data and creativity. Cosy, flourishing but now troubled. The evolving relationship between data and creativity.
  • 9. AI and robotics. We are the frogs of history, enjoying a slowly warming bath. 16 Areas of impact: + Home Automation + Measurement and Analytics + Human to Technology Interaction If you drop a frog into boiling water it will try to jump out. It will almost certainly not be a happy frog. Place a frog in cold water and then slowly increase the heat, and the frog will happily sit there while it boils to death. And so it is with new technology. As analogies go, this one is not the best – either for the frog or for the reputation of emerging technology. What it does illustrate though, is how incremental change can go almost completely undetected. So it is with AI and robotics. The pace of change in these areas is undeniably increasing, but we are waiting for some kind of ‘revolution’ that we can look back on as being a turning point in society’s journey to AI and automation. 2016 Viewpoint Trend: Impact: Action. The home is where robots will become the most visible. Companies like Amazon and Google, and start-ups like Jibo want us to place voice-enabled hubs in our home to provide an interface with their ecosystems and the wider web whilst giving us greater control over our connected home. People are becoming less awkward about talking to their technology – especially now that you don’t have to repeat yourself eight times in order to open Internet Explorer (Dragon Naturally Speaking, circa 1996). Anthropomorphising voice interfaces by sticking on a couple of eyes and a tilting head, might be the final step we need to feel properly comfortable communicating with our technology in a natural manner. DRIVERLESS CARS Outside of the home and beyond the obvious medical and military applications, the most obvious example of personal robotics will be driverless cars. We will be spending large amounts of time sitting in a robot whilst we carry on consuming content and conversing (maybe) with our fellow passengers. And off the back of robots in the home and robots on the road will be data; terabytes and terabytes of data being produced every day. In some ways we can’t imagine how data on our daily routines, our conversations, the way we dress, the food we eat (and the way we prepare it!) might be used. But when you consider that we are still in the early days of programmatic, autonomous marketing systems, it’s not a huge leap to imagine a world where consumers are served up a seamless narrative of content and advertising (if the two will be considered entirely separate) weaved into every facet of their personal lives. Timely, contextually relevant suggestions can be made based on the analysed data of a thousand consumers whose morning ablutions matched your own, or whose journey to work consisted of the same route, media and argument with the kids. Having a conversation with your partner about buying a new car? The personal robot within earshot may be capturing that and serving you ‘promoted’ updates to help you spend your money. And if you think that people won’t be happy with Google listening to and monetising our private conversations, remember we all seem pretty comfortable with them doing it with our email. It’s all about the value exchange. THE FUTURE IS ALREADY HERE, IT’S JUST NOT VERY EVENLY DISTRIBUTED You don’t have to imagine the impact of AI on marketing. Companies like Phrasee have built algorithms that create original short-form copy for email subject lines and banners that are many times more effective than anything a human being can write. Countless analytics platforms can derive meaning from the ocean of data that exists on public social channels, enabling marketers to target micro-segments of society with a high degree of accuracy. The challenge for marketers with the possibilities that AI and robotics open up for us is how to use it without freaking people out. Although the fine line between utility and creepy is constantly shifting as people become used to the technology. We are the frogs of history, enjoying a slowly warming bath. By the time we are aware of the impact AI has had on our lives, we’ll have been living with it for a while. We have been living with it for a while. ARTIFICIAL NARROW INTELLIGENCE VS ARTIFICIAL GENERAL INTELLIGENCE John McCarthy, who coined the term “Artificial Intelligence” in 1956, complained that “as soon as it works, no one calls it AI anymore.” That’s the state of AI today – we are surrounded by systems that use Artificial Narrow Intelligence (ANI). These are AIs that are created to carry out specific complex tasks – for example chess computers, driverless cars, the Facebook newsfeed algorithm, Siri, Amazon’s Echo and Google Now. And where you have ANI, you inevitably have robotics. The two can never be entirely separate, robotics simply provides a container for AI – especially where, in order to carry out its function, the ANI requires some kind of bidirectional real-world interface. ANIs are great at doing one thing – they can outperform a human in a single task. But ask a chess computer to describe the difference between a chair and a table and you’ll probably get a message telling you that you tried to execute an illegal move. By contrast, Artificial General Intelligence is flexible. It would be able to adapt to different scenarios, learn rapidly and improve its own performance. At present, we are still some way off achieving this level of intelligence and balanced estimates put this particular milestone as being passed within the next 10–20 years. ANIs are here now, and they are tools of individuals and companies. PERSONAL ROBOTICS – THE ANI IN OUR LIVES Personal robotics will put a face (or a body) on the already maturing ANI technology. They provide a conversational link with digital content, understanding what you want to see, when you want to see it and then delivering it via an invisible interface – or voice, as we call it. By providing our AIs with a broader and more useful sensorium, enhanced by the fact of their physical presence and mobility, our robots will be aware of all of the nuances of our lives in much greater resolution that we can imagine. 17
  • 10. Creating the world’s most influential work. We’re a leading creative marketing agency with over 28 years’ experience connecting brands with consumers in innovative and memorable ways. Some recent work 18 2016 Viewpoint Trend: Impact: Action. 19 Based in Soho with over 260 talented agency folk, we combine our skills in different ways, blurring the line between creativity and technology to produce brilliant, effective and award-winning work that truly influences people’s purchase decisions and behaviour. Fully integrated and with strategy and creative at our heart, our expertise covers the full spectrum of marketing communications. We also have specialist teams in data, digital development, technical innovation, relationship marketing, retail experience, social and influencer marketing, marketing technology, content and production services. INTELLIGENT INFLUENCE Emotion is at the heart of decision making. People feel, then they do, then they think. So we create influential ideas and experiences that unlock the power of how people feel through a unique approach we call Intelligent Influence. Using insight and data, Intelligent Influence helps our clients create stronger and more meaningful long-term relationships with their consumers. INTERNATIONAL REACH We have an agency network in 25 countries worldwide through our partnership with Serviceplan International and work with some of the biggest brands in the world delivering campaigns with global appeal. UNLIMITED THINKING We are part of a group brand offer called Creston Unlimited, designed to solve the big and often complex client challenges of today through Unlimited Thinking. Unlimited Thinking is centred around impartial advice drawn from senior thought leadership and expertise from across our group agencies. Client Virgin Trains Campaign Arrive Awesome Our award-winning campaign for Virgin Trains saw us develop a new bold brand positioning called Arrive Awesome designed to make everyone fall back in love with train travel. The idea allowed us to make every step of the customer journey awesome from booking through to the on-board experience and post-journey, and was translated across all touchpoints from TV through to social, online and email. Using data-driven insight and personalisation, our communications deliver tailored content and relevant offers and resulted in £13.5m incremental revenue in the first 12 months of our appointment. Virgin Trains has now become a much loved and trusted brand, with positive sentiment towards it in social media increasing threefold – no mean feat in the world of train travel. The campaign won gold at the 2015 DMA Awards in the Best Brand Building category. Client Lynx Campaign Bigger Issues To help Lynx grow up and appeal to an older audience, we aligned the brand with a social cause that is both of huge importance to young men, and will radically change how guys view the brand: awareness of male suicide. Incredibly, suicide is the single biggest killer of men in the UK under the age of 45. Partnering with the male suicide charity CALM, we developed the #BiggerIssues campaign, drawing attention to all the comparatively trivial things that guys are talking about a lot more than suicide. Across social media, digital banners and live digital OOH, we pulled in whatever subject was dominating headlines and newsfeeds at that moment to put the issue on people’s radar at an unprecedented scale and in a provocative, uniquely Lynx way. Over a period of two weeks, all digital creative was updated every two hours – the current rate at which guys are killing themselves in the UK. To spread the word, we engaged with key influencers such as Professor Green and Stephen Fry and organised a ‘thunderclap’ – an automatically scheduled collective post from registered people’s social media accounts – which reached 23 million people around the world.