Video: http://www.youtube.com/watch?v=iBLO1mCscrc Clients don’t want to pay for it. Creatives don’t always value it. Account people try to substitute for it. The result? Work that doesn’t work, unhappy clients, and disengaged consumers. A presentation on revitalizing the value of strategy in advertising from the 2013 4A's Strategy Festival.

1. *Unless

2. If I had only one hour to save the
world, I would spend fifty-five
minutes defining the problem, and
only five minutes finding the
solution.
– Einstein

3. Let’s talk about value.
In looking at how planning can
build respect in an organization,
we’re really talking about how
planning can build value. !
!
So let’s talk about value because
that’s really the root of the issue,
and if we can understand the
mechanism behind value, we can
adapt and optimize for it.!

4. Where does value come from?
If we look at value and where it
comes from, it turns out that value
is a layered idea consisting of
three distinct layers.!

5. Where does value come from?

6. At the shallowest level, value comes from perception. There are things we simply
perceive as more valuable than others. Let’s take a simple example: handbags.!
!
Two handbags with marginal differences in raw materials and labor can be sitting
next to each other on a shelf, and because of a simple label, we’re willing to pay
double. That’s perception-based value.!

7. Rory Sutherland has a phenomenal Ted Talk on the power of perception, and
one of his examples deals with Prussia in 1813. At the time, Prussia was at war
with France and the upper class was asked to turn in their precious metals to the
state for the raw material value. As a substitute, the Prussian noblemen had their
jewelry remade in cast iron, and for the next 50 years, the most valuable jewelry
in Prussia wasn’t gold or silver. It was cast iron.!

8. If we go one level deeper, the
next facet of value comes from
utility. !
Something has value because it
serves a purpose or function.!

9. So a household item, like a paper towel, has value because it serves a tangible
purpose. You have dirty dishes and you need to clean them. A paper towel has
inherent value there. The majority of objects we encounter on a daily basis fall
into this layer.!
Now, what’s interesting is that once something breaches the utility layer of value,
the perception of value is inherent. If something serves a purpose, it has
utilitarian value and perceived value baked in. !

10. This brings us to the deepest level of
value: rarity. !
!
The easy go-to here is diamonds, but
because they don’t really serve a purpose,
I would prefer to go with an emerging
technology like a 3D printer.!

11. This is a MakerBot
Replicator 2, and for
now, it retails for
about $2000. The
long-term goal is to
get one of these into
every household in
the US. !
At that price tag
which is a reflection
of the emerging
nature of the market,
the Replicator 2 lies
in the rarity layer,
again with utilitybased value and
therefore perceptionbased value as
inherent
characteristics.

12. $2000 is a lot to ask
for a piece of
household
equipment, but
MakerBot can ask it,
and many of us are
willing to pay for it
because it’s an
emerging technology. !
!
It’s a piece of
machinery that is
incredibly hard to
replicate, and in
addition, it grants the
user added
capabilities. !

13. Value can cascade over time.
Now that we have all three layers, the last bit of theory is that value can cascade from layer
to layer over a long enough time horizon. For example, the four-function calculator was
introduced in 1961 at $1000, which is especially expensive if you consider inflation. Today,
no one would dream of paying more than a few dollars for a simple calculator. The
technology became more common over the years, and the market for simple calculators
matured as the technology moved from rare and valuable to common and commoditized.!

14. How does this translate to
planning?

15. How does this translate to
planning?
Three-pronged issue.
We
need to revitalize
value of
the
strategy and planning as it relates
to clients, creatives, and account
people.!

16. Clients don’t want to pay for it.*

17. Clients don’t want to pay for it.*
Perception issue
The first problem is that clients
don’t want to play for it. This is an
issue of perception. To them, a
handbag is a handbag. Work is
work, period. They see the
additional time and resources that
go into strategy as a luxury.!
!

18. Clients don’t want to pay for it.*
*Unless it creates tangible return.
As strategists, we need to look at our work in the same
way the client does, as an investment.!
Clients won’t want to pay for it unless planning can
provide a tangible return in some form or another.

19. Creatives don’t always value it.*

20. Creatives don’t always value it.*
Utility issue

21. Creatives don’t always value it.*
*Unless it elevates the creative
plane.
In its purest form, planning should provide creatives with a valuable tool for
creation. As planners, our insights should bring creatives to a solution they
could not have reached without the insight we’ve provided. So to bring true
value, our strategy must elevate the creative plane and serve a distinct
purpose for the creative team.!

22. Account people try to substitute
for it.*

23. Account people try to substitute
for it.*
Rarity issue

24. Account people try to substitute
for it.*
*Unless it can’t be replicated.
And at the deepest level of value, planners should be striving to unearth
insights that cannot be replicated.

25. Tangible ROI +
Creative Elevation +
Irreplaceability

26. Tangible ROI +
Creative Elevation +
Irreplaceability
DEPTH.
So now that we truly understand the
problem, we can talk about a solution.
And when you add up a tangible ROI,
creative elevation, and irreplaceability,
the solution that emerges is depth.!
!

27. Tangible ROI +
Creative Elevation +
Irreplaceability
DEPTH.
Depth can mean a lot of things, but
I’m specifically talking about not
being afraid to dive head first down
the rabbit hole. !
!
I’m talking about making
connections that are parallel but not
necessarily obvious. !
!
That ecosystems can be incredible
predictors of market trends. !
!
That car thieves know a thing or two
about automotive interior design. !
!
That prostitutes have the purest
brand perception regarding luxury
cars because their livelihoods
depend on it. !
!
It’s not about understanding the
user, it’s about becoming the user
and adopting his or her mindset.!

28. In conclusion, just remember:!
!
Value is layered.
Value can cascade.
Strategy that breaches the rarity
frontier will create the most value.

29. Please tweet questions
or comments to
@AlxBrands
I’d love to chat.

30. *Thank You