The problem with digital transformation

This post is by Erik Ingvoldstad, a veteran in digital media, creativity and strategic development. He runs Acoustic, an independent Digital Transformation and Innovation Consultancy in Singapore. 

Digital Transformation

Digital Transformation is on everyone’s lips these days, from cool new start-ups, to the mastodons of the corporate world.  The business models of yesterday are changing, and disruption is happening in all industries, across all markets.

The disruption is driven by new competitors, new ideas, new technology, new mind-sets and new cultural shifts that are making it more and more challenging for companies to stay connected with their customers and to just keep the business running as usual.

”Usual” doesn’t exist anymore. Almost every tech company, every consultancy firm and every digital agency talks the talk on Digital Transformation. But very few companies actually manage to walk the walk. So, what is the problem? Why is Digital Transformation taking so long?

Well, let’s look at some of the problems that we encounter when discussing Digital Transformation.

1. Inaccurate Definition

People and organisations (even the various consultants who sell Digital Transformation) have an unclear or vague understanding of what Digital Transformation is. It simply means different things to different people.

To some, it means organising your data in a more efficient way within the company. To others, it means using digital as the main platform for marketing communication. Or perhaps it means implementing new technology first and fastest, or using IoT devices actively, or creating disruptive start-ups like Uber or Airbnb.

And they’re all sort of right. Digital Transformation is a strategic process. The outcome will vary from company to company, industry to industry, market to market and strategy to strategy.

Digital Transformation is the process to get to wherever your business needs to go in this new multi-faceted world, where linear strategies are doomed to fail. Digital transformation is about trying to find new ideas to drive tomorrows business, finding ways of creating a culture of ongoing innovation and creativity that is fully customer-centric.

This sounds easier than it is, as it requires focus on truly understanding the customer, having people that really believe in change as a vehicle for driving growth, and top management that fully understands that in tomorrow’s world, standing still is equal to going backwards.

2. Unclear roles and Responsibilities

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What Kind of CMO Leadership Do Advertisers Need Today?

This post is by Michael Farmer, Chairman of TrinityP3 USA and author of Madison Avenue Manslaughter: an inside view of fee-cutting clients, profit-hungry owners and declining ad agencies, which won the Axiom Gold Business Book Award for the best marketing / advertising book of 2016.

CMO leadership

CMOs are getting a lot of attention from the trade press these days, where writers drag in the usual suspects — Big Data, analytical skills, experiential marketing, Instagram, programmatic buying, Facebook, mobile platforms, Millennials, AI, Virtual Reality, etc.

All to demonstrate how CMOs need to become superhuman masters of everything new and challenging, pushing themselves and their marketing organisations to achieve higher levels of marketing and technological sophistication.

Let’s pause and take a deep breath.

CMOs are senior line executives, just as Army generals are senior line military officers. Each has the leadership and managerial responsibilities to organise and mobilise their resources for victory, using the resources and weapons at their disposal.

What is victory in today’s marketing world? How can it be achieved? What kind of leadership must CMOs show? These subjects are much less written about than the sexy nature of the weapons that might be deployed.

Victories are needed.

Legacy brands are languishing in the marketplace, and CMOs come and go with frightening regularity. Try this experiment: do a Google search of the words “Company X growth problems,” and fill in “Company X” with a random company of your choice: Nestle, General Mills, Coca-Cola, PepsiCo, Kraft, General Motors, American Express, Unilever, P&G, Budweiser, MillerCoors, Walmart, Bank of America, etc. Don’t stop there – try any company. There’s a lot of underperformance in today’s marketplace.

CMOs have a tough time convincing their bosses that they have solutions for brand stagnation and justifications for their spend levels on media, agencies and production.

They have not shown the necessary expertise in mobilising their marketing weapons to achieve victories in the marketplace. Instead, they’ve been experimenting (or even blowing smoke) with marketing tactics: they’ve hired and fired agencies at a rapid rate, benchmarked agency costs, cut agency fees, experimented with different mixes of “working vs non-working costs,” created in-house agencies, grown their digital and social scopes of work – engaging in a veritable frenzy of activities, without much strategic coherence or positive effect.

Their frantic activities may have made things worse. One thing is certain – in the quest for lower costs (as a substitute for improved growth), they have handed off the responsibility for agency management to Procurement, commoditised their ad agency partnerships, increased the complexity of their agency portfolios and reduced the quality of advice that they might have otherwise received.

There are reasons for this, of course – agencies failed to diversify and become expert across the wide range of marketing disciplines that have emerged over the past decade. Advertisers had little choice but to increase the number of specialised agencies with whom they worked.

But things are changing.

Continue reading “What Kind of CMO Leadership Do Advertisers Need Today?”

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Marketing Technology and its impact on Media Ethics and Transparency

This post is by Darren Woolley, Founder of TrinityP3With his background as analytical scientist and creative problem solver, Darren brings unique insights and learnings to the marketing process. He is considered a global thought leader on agency remuneration, search and selection and relationship optimisation.

There is much discussion on Marketing Technology and the impact it has on Media Agency Ethics and Transparency. In this post, myself and David Angell from TrinityP3 deliberately take differing points of view to explore the issues and encourage industry discussion on this important topic.

Marketing technology and media transparency Continue reading “Marketing Technology and its impact on Media Ethics and Transparency”

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The real problem with data is marketers don’t know how (or when) to use it

This post is by Zena Churchill, a Senior Consultant at TrinityP3. Over the past 20 years, Zena has worked for some of the biggest international and national brands. Having worked both agency and client side, Zena has strong insight and experience across most facets of marketing, specialising in media, strategy and BTL.

Marketers and data

In a recent TrinityP3 post, Darren wrote about the growing problem marketers appear to be having with data, posing the hypothesis that the problem with data (and its effective use in marketing) is due to the fact many marketers misuse it in its application. 

At the end of the post Darren asks what is stopping marketers from coexisting with and embracing data and analytics in their roles and questions whether this lack of data trust stems from a lack of understanding.

It’s a great question and I absolutely agree, however I also feel that a huge contributor to the ineffective use of data boils down to the many marketers who don’t know how and when to use it.

Data, data everywhere but not a clue on how to use it

Earlier this year, TrinityP3 published its annual marketing predictions for the year ahead and, on this list, I predicted that in 2017 there would be an increase in importance placed on the need for skilled marketing analysts to form a crucial part of any marketing team that wants to get ahead.

This marketing analyst will be someone who can confidently sift through the plethora of marketing analytics we have available to us today and identify not only which information is important and usable, but also what isn’t.

This prediction has a touch of wishful thinking added to it because too often during my career, I have worked with and within marketing teams where more than a few members of the team didn’t know how to use data beyond a superficial glance of identifying an increase in sales or post likes.

This is concerning, quite simply because data has always been and will increasingly continue to be the lifeblood of a marketing team.

So why don’t more marketers know how to use data effectively?

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The impact of Autonomous Vehicles on marketers and the environment

This post is by Chris Sewell, Business Director at TrinityP3. Chris has a wide ranging knowledge of all areas of the advertising and procurement world and specialises in helping companies understand the environmental impact of their marketing spend. 

Autonomous Vehicles

I recently prepared a technology assessment on Autonomous Vehicles (AV) as part of my Master’s degree in environmental management. It occurred to me as I read yet another option piece on the future of AV that my report also formed the basis of my own opinion piece on this subject, especially where it relates to marketing and the environment – both key areas of interest for me personally and TrinityP3.

So, I will explore the social and environmental impacts of Autonomous Vehicles as they move out of the current testing phase to a widely accepted technology.  This report will focus mainly on road-based vehicles and consider what disruptions we are likely to witness as businesses, and therefore marketing teams; wrestle with the dilemma of selling a new service without completely cannibalising the existing gold mine that is car sales and the flow on services.

The Origins of the Autonomous Vehicle

One of the first concepts for an Autonomous Vehicle can be traced back to Leonardo da Vinci, circa 1479. ‘Da Vinci’s car’ is a drawing of a vehicle developed by the great renaissance artist and engineer. The car has a boxy shape and resembles a wagon (see figure 1). Sometimes called the clockwork carbecause it’s propelled by springs. Da Vinci’s car was designed as a robot, running according to a pre-set course and travelling a few metres at a time. So, clearly not a hipster’s ideal of a dream-car!

Self propelled cart

Figure 1 The original design of the self-propelled cart (Codex Atlanticus, f.812 r)

The concept of autonomous or self-driving vehicles starts to capture the public’s imagination within the realm of science fiction rather than in the science and engineering world. In 1935 at an expo in Silicon Valley, well before the advent of computers, the modern idea of self-driving cars using ‘smart highways’ to guide the vehicles was introduced (Frontier 2014). One of the more bizarre visions of a future with driverless cars was captured in the 1974 horror classic ‘The Cars That Ate Paris’ (Figure 2).

The Cars That Ate Paris

Figure 2 Poster from ‘The Cars that ate Paris’

Today engineers from technology companies such as Google and the leading traditional vehicle manufacturers are preparing their businesses for the future of mass-market, driverless transport. Whilst it is still early days, we will attempt to explore the potential for disruptions which are numerous. An emphasis will be placed on the key areas of resource usage and importantly, societal change and the subsequent marketing challenges.

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Book Review: Think Like a Freak by Steven Levitt & Stephen Dubner

This post is by Anton Buchner, a senior consultant with TrinityP3. Anton is one of Australia’s leaders in data-driven marketing. Helping navigate through the bells, whistles and hype to identify genuine marketing value when it comes to technology, digital activity, and the resulting data footprint.

Think like a freak

You may have read Freakonomics and SuperFreakonomics, however, have you read Steven Levitt and Stephen Dubner’s latest book Think Like a Freak?

If not, then here’s a little summary to entice you.

As always, I tend to wade through books at light speed over the summer break. And this one grabbed my attention from our recently updated TrinityP3 library. So I popped it on the pile to read.

Levitt and Dubner focus on solving problems. And they apparently received plenty of questions from readers after their first two books. So rather than tackle every specific problem they received, they decided to set out to teach and inspire people how to think like a freak.

How did they tackle it?

Well they explored the decision making for which way to take a penalty in soccer (football).

They found people who put to the test whether pricing of wine really correlates with quality.

They unearthed how the record for the number of hot-dogs eaten in 12 minutes was beaten.

They explain why Nigerian email scammers say they’re from Nigeria.

They created a flip a coin experiment to use for major life decisions such as should you leave your job, ask for a pay rise, quit a bad habit etc.

And they tackle how to persuade people who don’t want to be persuaded.

Fun yet freaky

As you can probably gather from above, it’s a fun read.

I loved the freaky thinking for breaking the 4 of July Hot Dog Eating Contest at Coney Island in New York City.

Suffice to say, the record of just over 25 hot dogs was broken by a Japanese guy who thought like a freak.

I won’t spoil it for you. Grab the book to find out how he did it. And like me, I’m sure you’ll be surprised.

Some memorable quotes

Maybe I’m a little biased. However, being a soccer player myself, I was engrossed by the opening statistics drawn from “Testing Mixed-Strategy Equilibria When Players are Heterogeneous: The Case of Penalty Kicks in Soccer.”

Which corner do you choose to go? They talk about “…the chance of being a hero is about 75 percent”.

“Wouldn’t it be nice to jack up that number? Might there be a better way to think about this problem? What if you could outfox your opponent by thinking beyond the obvious?”
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What are we to make of the holding companies in 2017?

This post is by Michael Farmer, Chairman of TrinityP3 USA and author of Madison Avenue Manslaughter: an inside view of fee-cutting clients, profit-hungry owners and declining ad agencies, which won the Axiom Gold Business Book Award for the best marketing / advertising book of 2016.

Holding Companies

The marketing communications holding companies, like the industrial conglomerates that preceded them, were created through M&A transactions and run as decentralized financial holdings.

In this business model, acquired agencies and businesses are expected to improve their financial performance by growing revenues, profits and profit margins. The holding companies make additional acquisitions, using their ever-increasing stock market prices to buy more efficiently.

The holding companies become perpetual “share price growth machines” as long as their acquired businesses have “unrealized performance potential,” and as long as there are businesses left to acquire at reasonable prices. Interpublic (1960), WPP (1985), Omnicom (1986), Publicis Groupe (1988) and Dentsu (1997) have had exceptional track records of success, and the senior executives of the holding companies have been well-compensated.

Looking ahead, though, the holding company machine is unlikely to operate as in the past. Too much has changed:

1. Creative agency “unrealized performance potential” is drying up

Creative agencies have gone to the wall annually to deliver improved margins to their holding company owners. This has been done in the face of procurement-led fee declines and marketing-led SOW workload increases. Creative agencies have few additional reserves to call on. Their people are severely underpaid and stretched; employee morale is at an all-time low, and agency capabilities have been diminished through underinvestment.

2. Media agency contracts and fees are under increased scrutiny

The furor over “media transparency” is leading clients to pay closer attention to media agency contracts and remuneration. Media agencies have been the cash cows of holding companies, helping to plug the performance gaps of their sister companies. This role for media companies may be harder to achieve in the future.

3. Reduced agency influence with clients

The original ad agencies of the holding companies, like McCann Erickson, FCB, JWT, O&M, BBDO, DDB, TBWA, Publicis, Leo Burnett, Saatchi & Saatchi, etc. did not expand their advertising capabilities into direct, digital or social marketing under their brand names during the early days of media fragmentation. These capabilities were developed by sister or other agencies, and clients, who wanted integrated services, had to work with many rather than with one single agency. This killed the AOR concept and reduced the influence previously enjoyed by these lead agencies. It also encouraged clients to bring work in-house.

4. Relationship ambiguity

In the face of AOR declines, and in a desire to safeguard their revenues, holding companies became proactive in seeking “holding company relationships” with clients. They turned themselves into “super-agencies” that offered the full and exclusive capabilities of their diverse portfolios. However, this put their agencies in an ambivalent situation. They had to be subordinated players in holding company relationships — providing the expert people that the relationships required — and, as well, fiercely competitive branded agencies that continued to win business and deliver growing profits.

Continue reading “What are we to make of the holding companies in 2017?”

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The negative impact of overworked agency staff on agency remuneration

This post is by Darren Woolley, Founder of TrinityP3With his background as analytical scientist and creative problem solver, Darren brings unique insights and learnings to the marketing process. He is considered a global thought leader on agency remuneration, search and selection and relationship optimisation.

Any work related death is a tragedy. But the death of a young woman at Dentsu Inc in Tokyo on Christmas Day, 2015 was shocking.  Even more so because the official cause of death was overwork. Her sad demise has resulted in a major rethink of the culture at the agency and contributed to the CEO announcing his resignation early this year.

But this is not an isolated incident with a young copywriter dying from heart failure due to overwork and an overdose of energy drinks in Indonesia at the end of 2013.

Overworked agency staff

This culture of working often ridiculously long hours is not new to the advertising industry. I remember as a copywriter and especially as a creative director often working 12 hour days and longer, including weekends if we were working on new business pitches.

You had not just your existing client work, but then on top of this you were working on concepts for the pitches too.

But it does pose the question, that when advertisers are still primarily paying their agencies based on the hours the agency staff are working on the client’s business or are retained to work on the client’s business, what impact is this having on the agency culture of overworking and what impact is a culture of overworking having on the advertiser’s remuneration of the agency.

What is considered overworking?

Lets start with the fact that most retainer agreements are based on an agreed number of billable hours per annum. The TrinityP3 Remuneration Calculators  and the Resource Rate Calculator Phone App both allow you to calculate the number of billable hours per year for your particular market.

The reason being that the billable hours per year is impacted by the standard working week, the number of public holidays per year and the standard holiday leave per year. It can also be impacted by the amount of agreed sick leave and other entitlements too. You can find a detailed explanation and example of how to calculate billable hours per year here.

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Managing Marketing: The media industry, women in media, and the state of the media

Managing Marketing is a podcast hosted by TrinityP3 Founder and Global CEO, Darren Woolley. Each podcast is a conversation with a thought-leader, professional or practitioner of marketing and communications on the issues, insights and opportunities in the marketing management category. Ideal for marketers, advertisers, media and commercial communications professionals.

Denise Shrivell is the Founder of MediaScope and discusses with Darren the state of the media industry today, the challenges of media technology and her MediaScapes. They also discuss the role of women in media and the role Peggy’s List plays in ensuring women have equal opportunity to share their thoughts and insights in the important discussions on the issues facing the media and marketing industry.

DeniseShrivell

You can listen to the podcast here:

Follow Managing Marketing on Soundcloud or iTunes

Transcription:

Darren:

Welcome to Managing Marketing, and this week I’m joined by Denise Shrivell, founder of MediaScope and someone that I’ve known in the industry for quite a few years. So, welcome Denise.

Denise:

Thank you very much for having me, Darren. It’s good to be here.

The state of the Australian media

Darren:

So, it was interesting, we’ve done a few projects together but the one that I think is particularly salient is for a couple of years we went to the market and asked what is the state of the Australian media?

Denise:

We did.

Darren:

And we got, well from my perspective, an underwhelming response from the point of view that it seemed to be the same problems every year but no one had any solutions. What did you feel?

Denise:

I don’t think there were any surprises perhaps in the findings of the two or three surveys that we did. I think first of all the way that it came about was you and I met, we were kind of introduced, and we spoke about the ongoing discussions that I was having in marketing about the frustrations in the media trading process.

So, my conversations were predominantly with media agency people but also a lot of publishers who were just so frustrated at the way they were being treated by media agencies they couldn’t get in.

They felt like the opportunities they were presenting weren’t getting through to the client. They felt like no matter what they did the agencies were just going to go with the normal cookie-cutter approach and so on.

So, ongoing conversations about this frustration. So, when you and I spoke about that we thought let’s do a survey. Let’s really find out what’s going on.

Darren:

I know because at the same time we had the media agencies all complaining about how do we attract talent? How do we keep talent? You know it seemed like the trade press and the conversation was all about the same thing over and over again. Yet no one seemed to be proactively trying to stimulate or curate the conversation around how to move forward. Continue reading “Managing Marketing: The media industry, women in media, and the state of the media”

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How TrinityP3 achieved 200,000 website visitors (and how you can too)

This post is by Mike Morgan, Founder and Director of High Profile Enterprises and Content Director for TrinityP3. Mike has been collaborating with TrinityP3 on a Content Marketing, SEO and Social Media strategy since early 2011.

200,000 website visitors

2016 was a big year for TrinityP3. And this was reflected in Google Analytics results.

For the first time in 2016 we had more than 200,000 visitors to the TrinityP3 website. And this is a remarkable achievement for a business and website that focuses on topics that most people outside of the advertising and marketing industry are not aware of.

Who would be aware that there is a very necessary role in managing the relationships, remuneration, alignment, processes, rosters and structures of major businesses and organisations and their advertising agencies?

Yet, the content that has been published on the TrinityP3 blog has reached a significant number of people around the world.

TrinityP3 is in the process of transitioning from an Australia-centric approach to a global business. TrinityP3 Australia is now joined by major initiatives in London, New York and Singapore.

TrinityP3 Map

How did we get to the 200K visitors mark?

I have published a couple of posts that have detailed our strategy and results, first with this post in 2013 which examines ROI mapped to web traffic growth and then with this comprehensive review of analytics, revenue results and a full strategy in 2015.

In this post I will revisit the strategy, will explain some bumps in the road and will talk about what happens next. Continue reading “How TrinityP3 achieved 200,000 website visitors (and how you can too)”

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