Revolutionary Measures

Elon Musk and brand safety – a cautionary tale

Consumers increasingly want to engage with genuine brands with a personality. And in many cases this goes back to the founder and CEO. Think of Apple and Steve Jobs, Microsoft and Bill Gates, Burt’s Bees and Burt. Or, as I heard yesterday on Radio 4, Gwyneth Paltrow and Goop.

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Photo by Pixabay on Pexels.com

In a world where consumers are bombarded with slogans from faceless corporations, having a figurehead that they can relate to should be an excellent shortcut to drive success. And, in many ways it often is. However, one of the key factors that drives people to found and grow businesses is self-belief that whatever they do is right, and that they need to battle the world to maintain their success. Add in that the more success they have, the fewer people there are around them who are willing to tell them when they are wrong and you can see a recipe for potential reputational disasters.

Elon Musk is a classic case in point. He’s built Tesla into one of the most recognised car brands on the planet, from scratch, and helped accelerate the spread of electric vehicles. Earlier in the year the company had a stock valuation of $50 billion – larger than Ford, despite its much smaller size (and profitability).

Of course, the key phrase is “had a stock valuation of $50 billion”. Musk announced in a tweet that he had the funding in place to take the company private at $420 per share. When it turned out he didn’t he was sued by both investors and regulators. A further tweet after he was fined for this saw the stock fall further, knocking $10 billion off its value. And don’t forget this is the man that called a British diver involved in the Thai cave rescue a ‘pedo’ and was recorded smoking pot on a podcast.

So how can organisations combine the creativity, drive and charisma of a founder with brand safety? There are four ways to achieve this:

1          Trust the CEO
You could, of course, just let the CEO do what they like, Richard Branson style, but that’s assuming that they understand that there are limits to their behaviour. In the case of true loose cannons (like Musk), this isn’t going to work. In the case of public companies it is also going to make the share price gyrate on a daily basis.

2          Focus on the product
A longer term strategy is to shift the focus from the founder to the product. So while the CEO might be introducing what the company makes, they are talking about what goes into it and what makes the company special, beyond their own personality. Bring in outsiders such as celebrities to subtly shift away from a single founder – a good example is the Virgin Media ads featuring Usain Bolt alongside Branson.

3          Build a team
No one person can run a multi-million pound company successfully. Leaders need help, so build a team and make sure that they are increasingly seen in the media. They are never going to have the same appeal as the founder – for example compare Tim Cook with Steve Jobs at Apple. But creating a wider team will deflect some of the attention over time and prepare for the point when the founder is no longer around.

4          Have people who can say no
Probably the hardest thing for an underling to do is to disagree with their boss, particularly if they have built the company from the ground up. Not many employees would embrace such an almost certain career-limiting move. That means telling founders that they are on the wrong track has to come from boards, independent mentors and from creating a culture where messengers are not shot, but encouraged. This is another long-term process, but one that needs to be thought of early in the process.

Balancing the marketing value of a charismatic figurehead with their wayward side is never easy – just ask Ryanair – but if brands want to stay around for the long-term they need to be ready to outlive their founder and put in place a framework and culture that turns ‘me’ into ‘we’ without losing the brand essence and magic they bring.

 

 

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October 10, 2018 Posted by | Creative, Marketing, Startup | , , , , , , , , , , , , , , , , , , | Leave a comment

3 ways to make people buy your stuff

The world is full of start-ups touting technological breakthroughs and innovations. But a substantial majority never make it to the big time, especially not as independent companies. This is particularly true in research-driven hotspots such as Cambridge.

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Why is this? A lot is down to a lack of understanding of the importance of marketing and sales, with tech-led founders believing that having the best technology is enough and will bring buyers flooding in. Therefore, they reason, there’s no need to focus on disciplines like marketing as the product is so good and so advanced that it will simply sell itself.

Clearly, nine times out of ten this is never going to work. As Tony Wilson discussed at this week’s Cambridge Marketing College Brainfood for Breakfast event, the uncomfortable truth is that “nobody is going to buy your stuff.” For a start people don’t like spending money, particularly in B2B, and are normally happy doing what they’ve always done – you don’t tend to get fired for sticking to the status quo.

Obviously there are ways that you can get people to buy your stuff, as Tony explained, but you’ve got to meet one (or more) of these three conditions:

1.Their business is better off after buying it
You can’t sell a product on its own. It has to solve a specific business problem and therefore deliver a quantifiable benefit. That could be speeding up a process (such as getting a product to market), or increasing efficiency. Essentially, to borrow a phrase from Clayton Christiansen, you need to help them with their “jobs to be done”.

2.Their customers’ lives are improved
Its an obvious fact, but businesses rely on customers for their survival. And in an era of rising customer expectations and ever-expanding choice, consumers are very happy to move elsewhere if a business isn’t providing what they are looking for. So your product has got to deliver benefits that help your customer’s customer in some way, shape or form.

3.They can differentiate from the competition
The other thing that keeps CEOs awake at nights is the competition. How can they differentiate their business while preserving margins? We’re increasingly in a winner takes all world, where premium brands can charge much more, leaving their competitors to scrap amongst themselves for higher volume, but lower margin business. Smartphones are a case in point – Apple, and to a lesser extent Samsung, can set high prices, confident that loyal consumers will see the value they deliver, while rivals are forced to discount. Each handset is broadly similar in terms of what it does – but it is differentiation and a focus on the customer’s needs that allows some brands to charge more. So, how does your product help companies to differentiate themselves from their competition?

It is clear that tech companies, particularly in B2B, need to focus on the needs of their customer, and their customer’s customer. But many don’t do this – or even understand how their product is being used or the value it is providing. The answer is simple, but does require marketers and sales teams to change how they operate. As Tony Wilson points out, you need to go out and talk to your customers, embed yourself in their world, understand their pain points and how you can solve them. That might mean revamping your product or bringing in additional functionality or partners to deliver this – but by providing a solution to a problem, you’ll increase sales, boost loyalty and preserve margins. The question is, are technology businesses ready to really listen?

Photo via Pexels.com

June 13, 2018 Posted by | Cambridge, Marketing, Startup | , , , , , , , , , , | 1 Comment

Why technology companies have to play by different rules now

In the 1970s and 1980s the business world was dominated by big oil companies, with energy giants becoming the largest corporations in terms of market capitalisation. These were followed by banks and financial services in the 1990s and early 2000s. All of this has changed – the world’s five largest public companies are now Apple, Google, Microsoft, Amazon and Facebook, with upstarts such as Uber leading the way when it comes to unlisted businesses.

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As they’ve grown these tech giants have expanded dramatically in what they do and the range of services they offer, demonstrated recently by Amazon buying offline upmarket grocery retailer Whole Foods. Essentially they’ve gone from being niche players, albeit in particular sectors such as search or retailing, to offering a panoply of interconnected services that constantly affect our daily lives – and in many markets they are essentially a monopoly, due to the power of network effects.

Much of what they do is invisible to the consumers that use their services – for example the majority of people don’t question why they are served particular search results, ads or news on Google or Facebook. Hence this week’s record $2.7bn fine imposed by the EU on Google for promoting its shopping comparison service to the top of search results.

Is fast too fast?
They’ve also often operated independently of existing rules, working to the Silicon Valley mantra “move fast and break things”. This has driven a huge amount of innovation, but has also led to behaviour that many find either reprehensible or even illegal. In 2014 Facebook’s UK operation paid considerably less corporation tax than my two person PR consultancy, for example.

Uber is a perfect case in point, with many countries banning its operations as its drivers don’t meet local taxi licensing regulations, set up to protect the public. Add in ongoing scandals around sexual harassment that have led to the departure of CEO Travis Kalanick and the overriding impression is of a company culture that focused on aggressive expansion at the expense of its people or the wider world. And Uber isn’t alone – the low number of Silicon Valley founders and VCs that are female or from ethnic minorities has raised eyebrows about the ethos behind the world’s largest tech firms.

Why does this matter now? Simply that the power of tech firms has increased dramatically at the same time as the complexity of their operations has deepened. At the same time, many people around the world feel left behind by the pace of technology and digital disruption, whether it is in the work or home lives, leading to a potential polarisation between the tech savvy and the tech illiterate. These worries haven’t driven people to populist politicians like Donald Trump on their own, but have added to a mood of not being in control amongst many citizens around the world.

Reading the papers, the number of bad things happening on the internet, from simple fraud to terrorist plotting, seems to be increasing exponentially, although whether this is true or is just the result of better reporting is a matter for debate. Whatever the cause it has led to calls for greater regulation and control by national governments over cyberspace.

Altogether this means that tech companies are facing an existential threat. While they are delivering record profits and driving ever-greater innovation they are now central to everyone’s lives and are therefore under ever increasing scrutiny, from governments and the public. Hence the call from Reid Hoffman, founder of LinkedIn for the tech community to sign a Decency Pledge, looking to stamp out sexist behaviour and sexual harassment, particularly amongst venture capitalists in relation to the founders of businesses that they fund. It is a start, but I think any Decency Pledge needs to go a lot further and cover all behaviour, and how it is communicated. Tech giants can’t hide behind complexity any more – they need to communicate openly and operate transparently if they want to win back public trust. Time for the old Google motto “Do no evil” to be resurrected…………

 

June 28, 2017 Posted by | Creative, Marketing, PR | , , , , , , , , , , , , | 3 Comments

Why ARM’s acquisition shows that Cambridge is changing

The official logo for the ARM processor archit...

Like a lot of people I was initially shocked by the recent £24 billion takeover of ARM by Softbank of Japan. Not only was it the biggest acquisition ever of a European IT company, but it was also widely seen as the jewel in the crown of the Cambridge/UK tech scene.

A few years ago Cambridge had three stock market listed companies worth over a billion pounds each – ARM, Autonomy and Cambridge Silicon Radio (CSR). All have now been acquired, with varying degrees of success – HP, Autonomy’s purchaser is still suing the previous management about alleged overstating of accounts.

At the same time a large number of the next tier of Cambridge companies, such as Jagex, cr360 and Domino Printing Sciences, have also been bought, leaving many people wondering where the next tech superstar will come from. This is particularly true as an increasing number of earlier stage businesses in exciting markets have been acquired by tech giants – Internet of Things startup Neul was bought by Huawei, Evi by Amazon and Phonetic Arts by Google. And that’s just the acquisitions that were announced. I’m sure that in many cases promising technology has been snapped up without making it into the press, as the deal size has been relatively small.

So, as someone involved in the Cambridge tech scene, should we be worried? Is Silicon Fen going to turn into an offshoot of Silicon Valley – a bit like the tech towns around Heathrow, but with a bit more IP? Thinking about it more rationally, there are two main reasons for the flurry of acquisitions, particularly of smaller businesses.

1          Cambridge’s reputation
All of these acquisitions are actually recognition of the strength of the Cambridge tech sector. Big companies are attracted to the area because of the talent and innovation on show, and are increasingly willing to take a punt on earlier stage businesses to get in first and lay their hands on new technology and IP. They’ve realised that not every acquisition will work, but that the wins should outweigh the losses. So, Cambridge’s PR has worked in attracting the largest tech companies to the area.

2          Changing mix of companies
Traditionally, a lot of Cambridge startups were built on biotech, science and engineering, either from the University or the innovative consultancies that differentiate the city from many other clusters. As Cambridge grows, a greater number of companies are software-based, which means that developing their technology is faster than when trying to commercialise a product from an interesting piece of lab research. Therefore, they are likely to have a steeper growth curve, and potentially a shorter lifespan as they reach maturity (and acquisition) quicker.

A further reason for optimism is given by the new Cambridge Cluster Map, which lists the nearly 22,000 businesses based within 20 miles of the city centre. With a turnover of £33 billion, the map demonstrates the range of companies and the strength of the local economy. A third of this turnover is made up of knowledge-intensive businesses, employing nearly 60,000 people. That’s a lot of innovation, whoever ultimately owns the companies concerned.

Looking back, I think commentators will see that the ARM acquisition is part of a change in Cambridge as it matures and becomes a recognised part of the global tech sector. The economy will continue to grow, but more of the capital will come from outside the city. While this means we will have fewer ARMs and CSRs, and more outposts of Amazon, Apple and Google, it won’t stop growth and innovation, which means the Cambridge Phenomenon is likely to go from strength to strength.

July 27, 2016 Posted by | Cambridge, Startup | , , , , , , , , , , , , , , , | Leave a comment

Marketing your brand with Pokémon GO

25914117692_5d42261ac7_zThe success of Pokémon GO has been unprecedented. Around the world people of all ages are playing the game, in many cases spending more time on it per day than on Facebook. When the game’s servers go down players feel lost and distraught and there have been countless warnings to people to be careful when hunting Pokémon – the latest about wandering into minefields in Bosnia.

The business impact has been equally huge. Nintendo’s share price has doubled since the launch of the game, while spending on in-app purchases is estimated to be running at $1.6 million every day. Bear in mind that a substantial chunk of that goes to either Apple or Google as owners of the respective iOS and Android app stores and you can see there are a large number of beneficiaries of the craze.

However, you don’t need to be a big business to benefit – one of the beauties of the game is that there are opportunities for organisations of all sizes to market themselves. Here are five to begin with:

1          Exploit your location
Pokéstops, where players collect items, can be any sort of prominent building, including pubs, leisure centres and churches. If your premises have been designated a Pokéstop it means you are likely to have more visitors. This is the perfect opportunity to boost your business – welcome Pokémon hunters into your shop, restaurant or bar with special offers. The same goes for gyms, where Pokémon are trained and fight. Also, be smart about it – if you deploy a Lure, which attracts local Pokémon for half an hour, you are likely to also receive more visitors. Activate these when you are less busy and you can bring in visitors in quiet times as well.

2          Get people walking/cycling
To hatch eggs, players need to walk or cycle for a set distance between 2 and 10km. And you can’t cheat by driving as your speed needs to be below 10 mph (slow for many cyclists). This is the perfect opportunity to get people exercising – towns and organisations such as the National Trust should look at setting up trails that players can follow, while the NHS and the Department for Health can try and incorporate Pokémon GO playing into people getting healthier.

3          Be Pokémon friendly
One of the biggest issues to playing the game in the countryside is the lack of a reliable 3G/4G signal. I’ve been close to catching numerous Pokémon, only for the critters to escape when the signal vanishes. Again, this is an opportunity for businesses – if you offer free wifi, make it available to players and you’ll gain their goodwill and custom. Given that people are focused on their screen when playing set up a safe area, away from traffic, where they can hunt, particularly if you have a Pokéstop in your location.

4          Bear in mind this is just the start
Pokémon GO isn’t the first augmented reality (AR) game, and it certainly won’t be the last. In fact, it isn’t really that complex or advanced in terms of technology. So even if this is just a craze, there will be many more AR apps coming on the market seeking to replicate the game’s success. So anything you set up to cash in on Pokémon GO’s success is likely to be equally applicable to other apps down the line. Be AR ready.

5          Use your brand
For bigger brands, particularly those creating their own apps, there are two lessons to learn from the game’s success. Firstly, it is built on being incredibly simple to use, setting a benchmark for user experience that everyone should aim to follow. Secondly, think about how AR can benefit your brand. If you are a visitor attraction such as a castle or historic ruins, you could bring the past to life with an AR app that shows people what your building looked like in its heyday. For consumer brands or retailers, can you create compelling AR experiences that help engage shoppers – or even guide them to specific locations in your shop to find what they are looking for.

Pokémon GO’s combination of usability, nostalgia and clever technology is driving huge success around the world. Whatever size of business you are, make sure you are exploiting the opportunities it offers to your brand.

With thanks to Lucas Measures for additional ideas for this post!

July 20, 2016 Posted by | Creative, Marketing, PR | , , , , , , , , , , , , , , , | Leave a comment

Is sports sponsorship worth the money?

 

Sponsoring a successful sportsperson or team should be a no-brainer for brands. Provided they pick one that appeals to their key demographic, they can benefit from their success, use them as a spokesperson, boost their brand and generally engage more deeply with potential and actual customers.

The Parc des Princes, which was hosting the fi...

However, if this is true why are many of the biggest companies in the world conspicuous by their absence from sports sponsorship? I may have missed it, but I don’t see the logos of Google, Apple or Facebook on footballer’s shirts, F1 cars or advertising hoardings in athletics stadiums. They simply don’t see it as a good use of their marketing budgets it seems.

Looking deeper, this is part of a retrenchment over the past few years, with commercial sponsors replaced by trade suppliers in many sports. In Formula One, the biggest sponsor of Lewis Hamilton’s Mercedes is, err, Mercedes, while Red Bull is a hybrid owner/sponsor. In cycling a large number of teams are sponsored by bike manufacturers and equipment suppliers and in athletics the likes of Nike and Adidas have a huge profile. In football seven of the 20 Premiership teams were sponsored by online bookmakers over the 2015/6 season, and a further two (including champions Leicester) by their owner’s companies.

So, why are consumer brands less visible when it comes to sports sponsorship – and what can clubs, teams and sportspeople do about it? I think it boils down to four factors:

1. The threat of scandal
There’s always been a chance that your brand’s chosen ambassador will go off the rails and get you publicity for the wrong reasons. But in an age of constant scrutiny the slightest indiscretion is now plastered over the front pages before your brand has the chance to react – look at Tiger Woods as a good example. As testing technology improves, more and more drugs cheats are being caught, even if, as in the case of Lance Armstrong, it is years after their offences actually took place. And that’s before you start on the impact of corruption within governing bodies on public and business perceptions of a sport. Many brands simply don’t want to take the risk of involving themselves in a crisis down the line.

2. Value for money
Sports sponsorship obviously covers a huge range of budgets and opportunities, but generally is becoming more expensive. Global competitions, such as the Premiership and F1 have a worldwide reach, meaning that only the largest brands have the budgets to spend on sponsorship. And to get any value from your sponsorship you need to make sure people know about it, using other marketing activities to make sure that your target audience feels involved and included, and that you maximise the impact through advertising, corporate hospitality and other add-ons.

3. Saturation
We’re coming up to Euro 2016 and the Rio Olympics, meaning sports fans will see a procession of sponsor logos over the next couple of months. By the end of it all, will people really remember who sponsored what? Was it Nike or Adidas that provided the match balls for Euro 2016, or had pride of place on the stadium hoardings? I’m sure, if asked, many fans would claim to have seen adverts for brands that weren’t even there, such is the level of advertising saturation we are subjected to thanks to wall-to-wall TV and internet coverage. Demonstrating this, over half of the brands that consumers associated with Euro 2016 in a poll were not even sponsors of the tournament.

4. Other opportunities
Put simply, brands have a growing number of places where they can spend their marketing budgets. From online advertising to supporting good causes, they are all opportunities to boost a brand and engage with audiences. In many cases these channels weren’t there 10 years ago – and equally some sports have been hit by what you can and can’t advertise. One of the reasons for the growth of F1 for example was the enormous sponsorship from tobacco companies – they had nowhere else they could advertise in most countries, so could focus their budgets on one sport. F1 is in many ways still coping with the hangover, with high costs and a cultural desire to outspend rivals – but not the budgets to support it.

Digital channels in particular make it much easier to measure the results of marketing in terms of click throughs, visits and sales, whereas measuring the impact of sports sponsorship can be more difficult.

So, is sports sponsorship doomed? Not completely, not while we are still able to be moved by amazing feats of sporting prowess on the field or track. However, brands need to be more careful on what they spend their money on, and activate sponsorship more cleverly if they are to stand out from the crowd. And teams, players and governing bodies need to focus on getting their own houses in order, removing cheats and corruption and remember that the reason that brands sponsor them is to reach the fans – put them first and you’ll build loyalty that will deliver return on marketing investment, whatever sport you are in.

May 25, 2016 Posted by | Creative, Marketing, PR | , , , , , , , , , , , , , , , , , | Leave a comment

Is there space for Google Spaces?

Google

Today our internet use is dominated by just a few tech giants – Google, Amazon, Facebook and Apple (GAFA) in the UK and US, with the likes of Baidu, Tencent and Alibaba leading the way in China.

What is particularly interesting is that generally each of these is good at one thing, or group of things. We turn to Google for search and email, Amazon for ecommerce, Facebook for social and Apple for mobile apps. There is obviously some competition – Google’s Android versus Apple iOS for example, but in general each giant has stuck to its knitting.

That’s not for want of trying – Google has tried to get into social media several times with projects such as Wave, Buzz and Google+, while Apple tried to launch Ping, a music-focused network. All failed, although Google+ limps on as everyone with a Google account automatically has a logon.

It isn’t all Google’s fault – the most successful social media networks tend to start small and grow from there, such as Facebook, Twitter, Instagram and WhatsApp. Users are attracted by the features, rather than the brand name, and then it grows exponentially through the network effect – essentially the more people who join, the more value everyone involved gains from being part of it. Social media starts at the grassroots, and that’s one of the reasons that people join particular networks. Mark Zuckerberg at Facebook understands this, hence splashing out on Instagram and WhatsApp rather than trying to develop clones of them from scratch. This neatly neutralises the competition while keeping users within your orbit when it comes to the time they spend online.

So that’s why Google’s latest attempt at a social media network, Spaces, looks like it is unlikely to take off in a big way. Described as a cross between WhatsApp and Slack, it allows users to have conversations and share information around specific topics with groups of people, avoiding, Google says, the need to hop between apps or cut and paste links. The trouble is it means installing/learning another app, and as far as I can see there’s no compelling reason for this to make it to the mainstream in its current form. Sure, people will use it to share information, such as when planning a holiday or big event, but it is hardly a threat to WhatsApp or Slack at present.

What would be more interesting is if Google used it as a basis for more complex, artificial intelligence driven services, such as bots that could be sent off to gain information. So, keeping with the holiday idea, you agree where you’d like to go and use Google to collect and sift relevant information, such as accommodation, weather and flight times, and present it in a single place. Given how long it can take to find all of this normally, that would attract users – and of course provide Google with much deeper data on what users are looking for, enabling them to sell more targeted advertising and hence boost overall revenues.

It is early days for Spaces, but it looks like it needs a bit more of a wow factor if people are going to use it seriously. Google has been burned before on social projects that have been well designed, but fallen short when it comes to getting consumers excited – so time will tell if Spaces joins the likes of Buzz and Wave in the failure column or carves out a loyal user base. However at the moment Spaces risks being seen as neat, but non-essential – hardly the best way to attract us from existing applications.

May 18, 2016 Posted by | Social Media, Startup | , , , , , , , , , , , , , , , , | 1 Comment

Will the FBI take a bite out of Apple?

Apple has built itself into the largest quoted company in the world by being different. From the early days of the Macintosh computer, through the iconic iMac and onto the iPod, iPad and iPhone, its products have challenged the orthodox approach with a combination of design and features.

English: The logo for Apple Computer, now Appl...

It has extended this into the virtual world. Unlike competitors such as Google and Facebook, which have built businesses essentially based on collecting and selling personal data to advertisers, Apple has positioned itself as a champion of privacy. In a speech in 2015 CEO Tim Cook stated, “We believe the customer should be in control of their own information.

This approach extends to protecting personal information stored on Apple devices and within iCloud. All iPhones and iPads are encrypted by default, meaning that even Apple itself cannot access the data on them. This obviously gives an unprecedented layer of protection for personal data, which has been particularly welcomed after Edward Snowden’s revelations of widespread snooping by intelligence services on electronic communications.

However protecting normal citizens against hackers, criminals and terrorists is one thing, but what happens when the iPhone in question actually belongs to a terrorist? This is the current case, being hotly debated in the media and on social media. Following the San Bernadino terrorist shootings last year, the FBI recovered one of the perpetrator’s iPhones. Obviously this is locked with a 4 digit passcode, and simply cycling through all possible combinations is impossible – after a number of failed tries iPhones are programmed to erase all data to combat this type of brute force attack.

Consequently, the FBI has asked Apple to help, removing the erase feature from this specific phone and allowing it to try and guess the password electronically, rather than having to type in the potential 10,000 combinations. It has refused, rejecting a court order and issuing an open letter stating that it will not ‘hack itself’ and create an insecure back door into its products that could be exploited by others.

In many ways Apple has a point – even without the Snowden revelations, governments have a poor record of keeping backdoors safe. This was demonstrated by the US Transportation Security Administration, which mandated that all luggage manufacturers created a skeleton key that could be used to open any suitcase. A photo of the master key was accidentally printed in the Washington Post, allowing criminals to model and create it using 3D printers.

At the same time, the FBI is adamant that it is not asking for access to the backdoor itself – it says it is happy for Apple to disable the erase feature itself and provide access to the data, without telling the Feds how it was done. Essentially Apple is putting itself above the law, which has potentially chilling ramifications given its size, number of users and global reach. It isn’t the plucky underdog it was when the Mac first went up against the PC.

The high profile nature of the case, and the fact that it involves a proven terrorist further complicates matters – most right-thinking people would want to help the government in this scenario. Perhaps the wisest words have come from Bill Gates, who is calling for a wider debate on the balance between privacy and accessibility, irrespective of the case in hand.

As I’ve said before, a reputation for protecting user information is a central part of the Apple brand – and is only becoming more important as the company branches into payments (Apple Pay) and personal health data. Therefore its principled stance makes perfect sense from a marketing point of view. It may well have to eventually comply in some way, but it will have lived up to its promise to fight for privacy, keeping the rest of its community happy, and consequently protected its brand. However what the whole case shows is that we need a grown-up, rational debate about who has access to our personal data, under what circumstances and how they can access it.

February 24, 2016 Posted by | Marketing, PR, Social Media | , , , , , , , , , , , , , , , , , , , , , | 2 Comments

Google, tax and PR – do no evil?

On the PR side it has been a busy couple of weeks for Google. Firstly, it casually announced at Davos that it had agreed to pay £130m for ten years of UK corporate taxes, although obviously without any admission of guilt. Cue a storm of protest that this was nowhere near enough for a business that reputedly made £7.2 billion of profits over that period, essentially meaning it paid 3% corporation tax. Much of the vitriol came from other media companies, particularly newspapers, that have seen their own advertising revenues decimated by the search advertising giant.

Google Quick Search Box

Then earlier this week Alphabet, Google’s holding company, became the world’s most valuable company by market capitalisation, helped by strong financial results and worries about previous number one Apple’s future growth prospects.

Given the closeness of these two events, it would be easy to draw the conclusion that ethically debatable behaviour leads directly to outstanding corporate success. But has it actually made any difference to Google’s reputation in the UK? I’d argue that overall it hasn’t affected its business in any way, for three main reasons:

1.The public doesn’t buy from Google
For the majority of people Google is a utility – providing them with the ability to browse or search the internet, watch videos, manage emails and documents or run their mobile phones, without charging them a penny directly. What people don’t understand is that the price of this free stuff is that they become the product – Google has built its very lucrative business on selling this data on our activities and preferences to advertisers. In contrast Starbucks, another perceived tax avoider, sells physical products direct to the public, giving consumers a vested interest in seeing the right levels of tax paid out.

2.Google does no evil
It will probably surprise a lot of people that Google is as enormous as it actually is. From its beginnings it has cultivated a laid-back, anti-establishment brand, epitomised by its corporate slogan “Do no evil” and heavy investment in moonshot projects such as self-driving cars and research into cures for cancer. Despite its growth, it is still seen as a Silicon Valley upstart successfully battling the likes of Microsoft (search, browsers, productivity applications, operating systems) and Apple (with Android).

3.Is there an alternative?
Obviously you can use different search/email/operating system providers, including those that make it clear that they won’t either track your online behaviour or use it to target adverts based on your browsing. But how many people actually make the effort to go out and switch, particularly when Google makes it so easy to just carry on using its services. The figures speak for themselves – it has nearly 86% of the UK search market, which hasn’t changed much since the first mention of its tax affairs.

So, while as a PR person I agree that it has handled the whole tax situation badly by trying to claim that it is doing the right thing when its activities are ethically dubious at best, I don’t think it will have a major impact on the corporate brand. This is echoed by an (admittedly small) poll in PR Week, where 51% of PR professionals said it would leave its reputation unchanged – and 11% thought the tax settlement would improve the brand.

However, where it may cause issues, is by attracting further attention from regulators at the European Union, which have previously shown that they have more teeth when dealing with tech giants than national governments. Time will tell, but with the media already setting its sights on Facebook for potential even larger tax avoidance, I think Google will feel that the £130 million it spent is worth every penny.

February 3, 2016 Posted by | Creative, Marketing, PR | , , , , , , , , , , , , , , | 1 Comment

Death of a (car) salesman

Like anything, buying a new car has positive and negative parts to the journey. The excitement of choosing and test driving a shiny new vehicle has to be balanced with haggling with a salesman in a dealership and painfully avoiding the add-ons and extra warranties that they want to burden you with (and co-incidentally give them a bigger commission than on the car itself).

Automobile dealership - service and repair are...

Yet, the internet was meant to remove middlemen and enable us to deal direct with the producer. It has worked in industries such as travel, where package holiday companies have had to reinvent themselves in an era of cheap flights, AirBnB and TripAdvisor. But for bigger ticket purchases we still rely on car dealers and estate agents rather than dealing directly with manufacturers or those selling their house.

The end of middlemen?
So why are these middlemen still here and will they survive for much longer? After all, most buyers now read car reviews online, check manufacturer videos on YouTube, get information on options from websites, and can arrange finance quickly at the click of a mouse. No wonder that the average number of dealers that buyers visit when purchasing a new car has dropped from 5 to 1.6 in the US over the last ten years. As in a lot of fields, more and more research is carried out online without needing to interact with anyone, let alone a sweaty dealer in an ill-fitting suit.

Illustrating this trend, upstart electric car company Tesla is looking to go direct to customers in the US, cutting out dealers altogether. Other manufacturers are trying more limited experiments with special editions sold online only or dealerships remodelled to be more like the Apple Store, with advisors providing information and help, but no hard sell.

The pace of technology change within the car also threatens to make the dealer obsolete. Modern cars are computers on wheels, streaming data back to the manufacturer and able to refresh their operating system remotely without human (or mechanic) intervention. Tesla regularly updates the software on its car over the air– with an upgrade in January 2015 improving the performance of its Model S, meaning it can match the acceleration of a McLaren MP4-12C.

However as a recent piece in The Economist points out, changing the system will be difficult. Dealers are a powerful lobby, and while they don’t make much money on each new car they sell, the ancillary products and ongoing servicing relationship can be extremely lucrative. It also provides buyers with the opportunity to get a better deal by haggling between rival garages – if you have the inclination to do so.

I think that there are more basic reasons for any middleman, whether a car dealer or travel agent, to survive – adding value, trust and ease. These are important concepts for any company in the digital age to embrace and it is worth looking at your business with these in mind.

1. Adding value
With the vast majority of information now a Google search away on the internet, and prices displayed for everyone to see, do you really add value or are you a hindrance to the process? Again, the Apple Store is a good example to follow. You can buy your iPad from one of a hundred shops or websites, but the help you receive and the ability to get your questions answered in a positive, unpatronising way naturally leads people to the Apple Store.

2. Trust
Do consumers trust you? Or more to the point, do they trust you more than the manufacturer you represent? One of the factors I think will hold back the demise of dealerships is that consumers trust car makers less. You only have to look at botched recalls and unreported faults to see why. Car makers are also much more distant than your local dealership, making it difficult to build a relationship of trust. That’s not to say dealers are safe – they regularly top polls of least trustworthy occupations, but in the kingdom of the blind, the one eyed man is king.

3. Ease
People have to do more and more with less and less time. In many ways the internet has made us more time-poor. Whereas before a holiday could be booked by marching into the travel agency and asking what they had available, it now takes hours of internet research, comparing the relative locations of villas on Google Maps and poring over TripAdvisor reviews. Those middlemen that still have a place recognise that they need to make things easy, providing a helpful service that cuts down the time you need to spend and removes roadblocks from the customer journey, without charging the earth.

Looking at your own business, do you meet these three criteria? If not, it is time to change, before pressure from consumers and manufacturers squeezes you out of the market.

August 26, 2015 Posted by | Marketing, Social Media, Startup | , , , , , , , , , , | 1 Comment