World Series Ads---Context Matters

One of the most exciting World Series in years is about to end. And while I'm still waiting for the outcome of the game, no matter which team wins, some of the ads I've seen tonight have left a bad taste in my mouth. 

As DVR's and streaming alternatives have driven advertisers to live events like the WorldSseries where they still have an opportunity to reach audiences, some have forgotten that context matters!

A few examples:

Lexus, in an effort to raise its profile to a large audience ran a 'December to Remember' ad...on November 1st. Sorry, my pumpkin is still breathing...it's too early!

Likewise, Target ran a holiday ad that was equally out of context. Baseball is better associated with the 4th of July!

But perhaps one of the most disturbing disconnects between message and context came from Southwest Airlines.

Eager to push their changeable fares before the holidays, they ran an ad in which a coach pledged that their team was going all the way, only to lose and have to change their travel plans. Running this on the 7th game of the World Series is the biggest buzzkill ever! No fan wants to be demoralized by an ad before it's over! 

So advertisers, before you jump on the live tv bandwagon, understanding the context! other wise you could do more damage than good!

Changing the Game: When Words Lead to Action

While actions may speak louder than words, words can lead to game changing actions. That is how brands can use language to set themselves apart. This is true whether they are looking to differentiate themselves in an existing category, or looking to change the category game. 

Great brands often use words to help drive brand behaviors that put them in a category of one. Disneyland does not have 'employees', they have 'cast members'. Cast members behave differently than employees. When they are at the park they are acting their role to create a truly immersive experience for their 'guests'...another word that drives behavior. This is why everyone 'cast members' will reach out to 'guests' to make them feel welcome and personally cared for. This is also why Disney keeps its 'set' spotless and does not tolerate trash on the sidewalk. 

American Express does not have card holders, but, rather 'members'. That's why American Express behaves like an exclusive club that builds member only airport lounges and offers personal Concierge services.

American Express Centurion 'Member' Lounge

Furthermore, when brands lead a category with breakthrough innovation, they have the opportunity to create a new language that drives with fundamental changes in human behavior. Before iPhone and iTunes, there was no such thing as 'downloading an app'. Sometimes the brand itself becomes synonymous those new behaviors. We no longer 'ship' packages, we 'FedEx' them. We no longer 'search' online, we 'Google'. We don't take a 'taxi', we 'Uber' home.

With the automotive category about to undergo significant change, how might language drive new behaviors?

If the pundits are true, in the not so very distant future fully electric vehicles will be driving themselves...and we might just be sharing them with others.  In this scenario, many words, like 'driver' and 'owners' will become obsolete, as will all the brand behaviors that are geared towards these words. Moreover, many of the category values like 'fun to drive' and 'gas mileage' will no longer be applicable. 

So what might the new language look like? How might it guide new brand behavior? And is there an opportunity for a brand to own the new category language?

If you are not driving you are a passenger or a rider. If you do not own the car, you are a user. Brands that begin to use and embrace this language could be ahead of the curve in being prepared for the future.

With that shift in language, everything from product development to advertising would change. For riders, the focus for product development would move from centering around enhancing the driving experience to giving more thought into the rest of the interior and the cars impact on passengers. Forget the ever growing size of screens in the cockpit...how about screens for all passengers? Forget step by step driving directions on GPS, how about narrated guided tours that give passengers more insight on local history and points of interest? Forget perfecting acceleration and handling...how about exploring technology that mitigates motion sickness? How about trademarking that technology to own it? 

Advertising would focus on amplifying these new experiences--no more romancing the sheetmetal or windy country roads. Ads might feel more like technology, entertainment or hospitality ads. 

If you go once step further from passenger to user, transportation service providers would begin to think and behave more like AT&T or Netflix, focusing on generating the highest possible average revenue per user (ARPU) by bundling more and more services. After all, what are users going to do with all those screens while they're riding? And, just like telecommunications service providers built their networks, electric transportation service providers would be investing in charging networks that could be bundled into these subscriptions.

These nuances in language are only the beginning of a long list of new words that are about to be infused into the category. Interestingly, almost every car company now defines themselves in the business of 'mobility'. As of yet, however, a change in language has not resulted in a change in behavior. Perhaps that is because, as a very knowledgeable student of the industry pointed out to me just last week, this is not a new word at all. Mobility is at the very root of the word automobile which is derived from the French for 'self moving'. . 

That said, perhaps there is still an opportunity car brand to breathe new life into the meaning of the word 'auto-mobile', by embracing the corresponding behaviors that purveyors of 'self-moving' devices would adopt.

Building a Bridge to The Future: Why Ford Can Go Further

Recently, Ford's CEO Mark Fields came under fire from its board of directors for its lackluster quarterly financial performance. As it strives to remain competitive in the face of the most significant change the automotive industry has seen in over 100 years, Ford has invested heavily in future technology. Ford's board was reacting to the challenge that all automotive companies are facing...how to fuel what will someday be your core business with profits from what will someday be your legacy business, while making everyone happy today.

How does a brand keep one foot in the past and one foot in the future and thrive today? Brands that focus on delivering consistent brand experiences that transcend categories and time can use those experiences to build a bridge to the future. For these brands, the classic '4P's' of marketing become subordinate to delivering one big 'E'. Over the years, Apple has been a master at this. 

Brand as big 'E'

In contrast, in the automotive business, all efforts are focused on delivering one big 'P'. Product development gets the lion's share of investment. All the other P's work in service of that product. This is why automotive marketing rarely strays from touting features and benefits. Product is star--the ultimate object of desire, while everything else, including the customer becomes a supporting prop for the product.

This is perhaps part of the reason that automotive marketing, despite a significant shift to digital media, remains stuck in the past. This is perhaps part of the reason that the category is losing relevance. And perhaps part of the reason that automakers are seeing their profits eroded by the need to prop up volume with ever increasing incentives.

And while that's the short term problem, nearly every automaker has acknowledged that their business will be shifting to a mobility services model over the next decade or two. Thus at some point, automotive brands will need to change the category conversation from 'P' to 'E' if they are to survive. 

Dictionary.com defines mobility as 'the movement of people in a population, as from place to place, from job to job, or from one social class or level to another'.

Thus, the  new automotive conversation will need to shift the focus from car as star to brand as life enhancing tool. The first brand to consistently and credibly do so has the opportunity to claim leadership and define the category on their terms.

And Ford just might have an edge to claim this leadership role.

First, it has established a Smart Mobility subsidiary to focus on delivering future experiences. Second, and perhaps more importantly, Ford has a history and heritage that allows it to credibly lay right to this claim. Henry Ford's vision was not about sheetmetal at all, but rather about affording the common person the opportunity for upward mobility. 

Ford's marketing has already dabbled in this territory. Ford's 2017 Superbowl introduced its Smart Mobility services by highlighting the consequence of the absence of mobility in a variety of non automotive life situations. And its tagline 'Go Further' has the potential to punctuate mobility as a life enhancing tool.

But in order for Ford to fully make the move in marketing they must build the bridge from the future to back to today. They must begin to highlight the almost forgotten power of personal mobility by focusing on the life enhancing experiences that all of their cars and trucks bring to customers right now. Ford has the right to become the champion for the millions of Americans who are feeling left behind. The Americans that Ford helps to go further, everyday. By making this shift, the customer becomes the star and the vehicle and other services become the tools to better life experiences...much like the Model T was oh so many years ago.
















 

The Autonomous Vehicle Adoption Curve: Why It's Likely to Look Unconventional

In a study conducted by Deloitte earlier this year, a vast majority of consumers felt that fully autonomous vehicles will not be safe.

Despite that statistic, vehicle manufacturers and technology companies are investing billions of dollars to develop fully autonomous capabilities. In fact, the first fully autonomous vehicles are due to hit the market before the end of this decade. But with such a high level of distrust, who will buy them? Perhaps the secret is to expand the reach of the category, rather than trying to convert those already in the category?

Unconventional Diffusion of Innovation?

Classic diffusion of innovation theory suggests that technology is adopted in stages, first by innovators, then early adopters, early majority and so on. 

This same theory suggests that innovators are risk takers, dreamers and adventurers. And early adopters are characterized as influencers who like to embrace change. But will that be the case for autonomous technology adoption? Or will the adoption curve look completely different?

Yesterday, I had a conversation with an automotive thought leader who suggested that the innovators would be commercial customers like Amazon and FedEx.  Hardly the classic risk taking dreamer or adventurer. Yet the argument made a lot of sense because for these companies, efficiency in time and money are key purchase motivators, and they carry things, not people.

If the innovators are commercial, what might the first consumers who make up the early adopters and early majority look like?

Can we change behavior?

Every licensed driver in the world has probably hit an imaginary brake pedal while riding as a passenger. The fact is, we don't just distrust autonomous, we distrust giving up control of the wheel, and of our consequent fate in potentially life threatening situations. 

Thus, finding the early adopters who are open to change may be more difficult when the new technology is not just a new smartphone, but rather a perceived safety threat to themselves and their families. 

Perhaps, rather than those who embrace change, might our early adopters actually be those who have nothing to change? Might they be those who have never driven a car before? Or those who have already abdicated control to others?

Sources of Early Adoption

If that is the case, then might early adopters be comprised of adults who have never driven before?  Perhaps in developing countries where vehicle ownership rates are low and automotive fatalities are high? It's not likely a coincidence that these are countries in which distrust of autonomous vehicles are lower. This won't be the first time that developing countries beat others to the punch. This is, in fact, quite similar to historical adoption of mobile technology, where countries with less access to landlines and home computers were the first to embrace mobile. 

Does that mean that countries like the US will fall into the late majority or laggard category? Not if US automakers look in unconventional places, with unconventional business models, to find autonomous customers. 

According to a recent study by the University of Michigan Transportation Research Institute, the rate of licensed drivers in the US is on the decline. This decline, while happening across the age spectrum is most pronounced at the younger end, and is significant. In 1983, almost half of all 16 year olds in the US had drivers licenses. By 2014, this rate had fallen to less than one quarter. During that same time, there was a 21% decrease in 19 year old licensed drivers, and some level of decline in every age category below 55. Much of the resistance, particularly at the younger end of the spectrum is due to the high perceived cost of vehicle ownership. 

So,  autonomous vehicles could provide US automakers with an opportunity to tap into the unconventional/incremental target of non-drivers. Of course, since early autonomous technology will not be cheap, US automakers will need to marry their nascent ride sharing initiatives with their autonomous vehicles from day one, if they are to penetrate this segment.

There are indeed other segments of non-drivers that could, for the first time, be accessible to automakers. Disabled and older former drivers would also fall into this category, again, expanding the total market for new vehicles. 

Brand Stretch?

Will appealing to these targets require automotive brands to stretch to the breaking point---beyond their current driving focused equities? If the focus of their marketing remains on features and dynamic benefits, then yes. If, instead, they  rediscover the higher order emotional benefits upon which their brands were first created, they might find remarkable synergies with their past. For instance, the freedom to explore new life experiences is what personal mobility brands have always offered. And at some time in the future, the laggards will even realize that this freedom to experience expands when they are no longer encumbered by the limitations of self driving.

What's the Purpose of Purpose? Don't Ask Oscar Munoz.

By now, unless you have been living under a rock you've heard of United Airline's series of debacles that wiped a billion dollars in shareholder value off the books. Much has been written about the PR nightmare that was exacerbated by the initial tone deaf response by United's CEO, Oscar Munoz about 're-accommodating' passengers. Digging deeper it seems that response is symptomatic of a brand culture in which words are meant to create an illusion for shareholders and customers, rather than shape actual behaviors. 

One need only go to 'Shared Purpose and Values' on United's website to discover the disconnect between United's words and behaviors. Its purpose is stated as: 'Connecting People, Uniting the World', something that arguably any airline does. The statement of purpose is accompanied by a video in which United's beleaguered CEO and other United employees espouse the values of 'The New Spirit of United'. 

The video speaks of a 'family friendly community' that 'faces challenges head on' by (in an unfortunate choice of words) 'tackling' them. It espouses 'putting the customer first' by being 'warm and friendly', and 'treating others the way they want to be treated'...

But as hundreds of millions of viewers around the world saw with their own eyes, these words ring hollow in the face of reality. And while this incident may have been more heinous than other customer experiences, the fact is that United consistently ranks at the very bottom of airline satisfaction surveys.

United is not the only brand to confuse grand proclamations with real action. Stating your brand 'purpose' has been in vogue for a few years, as the next big driver of brand value. This has triggered a rush by companies and brands to 'discover' and articulate their purpose.

What's the Purpose of Purpose?

Which begs the question, 'what is the purpose of a brand purpose?'

It might be easier to begin with what it is not:

• It is not something to fill a void in the 'about us' section of a website in the hope that investors and potential customers will be impressed with your new social conscience.
• Neither is it a way to re-articulate or re-package your existing CSR initiatives to make them appear central to your business.
• Finally, it is not simply a description of the business that you are in, disguised in a broader societal context.

Rather: 

• It should live, not on the corporate website, but in the behaviors of every employee in the company. 
• It should go beyond CSR to inform every major decision that a company makes.
• It should reflect a unique and sincere commitment to improve upon something concrete that has heretofore been lacking...thus making a tangible improvement on category experience and societal impact. 

An Airline With A Purpose

And while true purpose is scarce in the airline industry,  JetBlue might be an exception. It was launched in 1999 with the commitment to 'bring humanity back to air travel'. In 2007, JetBlue let passengers sit on the tarmac for 10 hours in a snowstorm and faced a PR crisis as big as United's current nightmare. Instead of just issuing a press release, it drew upon its purpose to deliver a detailed, fully transparent 'Customer Bill of Rights' that includes predetermined monetary compensation for customers who are subject to an avoidable inconvenience. And it did so within one week of the incident.

This dedication to behaving its purpose is probably the reason why today, according to newly released ratings by Trip Advisor, JetBlue is ranked number 1 in the US and number 4 in the world.  

Source: Trip Advisor 2017 rankings

True Purpose Creates Value

Moving outside the airline category here are a couple more examples of how real purpose creates real value:

• In technology, Samsung makes the rather nebulous pledge to 'inspire the world, create the future'. In contrast, the original purpose of Apple, the most valuable brand in the world, was to 'remove the barriers of learning how to use a computer'. While that purpose may not seem as clear since Steve Jobs died, it is reflected in every successful product that Apple has ever created.
• In a category near and dear to my heart, most automotive companies are currently stating their 'purpose' in terms of 'mobility', which is essentially a generic description of the category. In contrast, Tesla's purpose is to 'accelerate the development of sustainable transport'. This purpose at once sets it apart from other automotive companies, provides a roadmap for product and service development, and articulates a greater societal impact  It may also help to explain how Tesla's market cap could surpass Ford's last week.

So the purpose of purpose is not to just answer the question of what you do, or even why you do it. The real purpose of purpose is to identify what the category and society would miss if you'd never existed.

Sadly, for United, the answer might be 'nothing'.

The Future of Automotive Brands: Learning From the Airlines

Once again, automotive brands played a prominent role at CES. As cars continue to evolve to become the ultimate mobile devices, two factors, autonomy and sharing, will likely drive significant changes in car usage. According to Deloitte, by 2030, approximately 40% of miles driven in the US will be in either shared or autonomous vehicles. By 2040, shared miles will account for 80% of all miles driven, with more than 50% of those miles traveled in autonomous vehicles.

In a future where there are no drivers and no owners, what will happen to car brands? Will anyone care about styling or performance--the key automotive differentiators today? Will they even care who built the car that they use? If customers use cars as they are available, and car sharing services take care of the maintenance, will end users have any relationship at all with car manufacturers?

In fact, in search of efficiencies, car manufacturers are already diluting the role hardware in brand building. In recent years, companies like Nissan, Mercedes, FCA, Mazda and others have engaged in extensive platform and powertrain sharing agreements between unrelated manufacturers. Thus, the Mercedes truck that you buy, may be manufactured by Dodge or Nissan on a Dodge or Nissan platform. 

Could this actually be the first step in an entirely new model? One in which there are at best a handful of automotive manufacturers who supply cars to mobility service providers? Think Boeing and Airbus. In such a world, it is unlikely that there will be much differentiation at all on the outside of the vehicle. Instead, like airline brands, all automotive brand differentiation will be derived from in-car experiences.

What can automotive brands learn from airline brands to ensure that they are able to build shareholder value in the future?

The first, and perhaps most important learning is to strive for differentiated experiences, rather than differentiated prices. Airline focus on price and cost cutting has provided a valuable lesson in how quickly pricing to supply, without building demand, can lead to sub-par customer experiences and shrinking profits.

Putting that aside, there are many ways that automotive companies can differentiate by leveraging their own brand DNA to emulate some of the world's best airlines:

Amenities

Emirates is known for it's first class suites that offer the over the top luxury and amenities of any airline. Rolls Royce, Bentley or even Mercedes could leverage their heritage to create the most luxurious cabins, chock full of in-transit comfort and amenities. Grey Poupon, anyone?

Personality

On the other end of the spectrum, Southwest offers the basics with a cheeky attitude. This is clearly territory for Kia to dominate. Imagine riding along, singing karaoke with the Hamsters.

Quality of Experience

Singapore offers some of the best service in the air. Lexus and Toyota could leverage their quality/service reputations to emulate Singapore's business and economy class service.

National Pride

Qantas offers the spirit of Australia, with cuisine prepared by local chefs, and a decidedly Aussie in-cabin personality. This is a great territory for a brand like Chevrolet to own. Baseball, hot dogs, and apple pie, anyone?

Entertainment Content 

Jet Blue pioneered in flight access to Direct TV. Could a car company be known for the ultimate in flight entertainment? Could Hyundai, with its high profile sponsorships take this territory to create a sports bar on wheels?

Class of Service

Some airlines offer all business class service. Tapping into its Town Car heritage, Lincoln could offer mobile offices to business executives. Moreover, Uber, who will likely play in this space in the future, has already set the stage for classes of experiences, with its X, XL, Select and Black service. Its autonomous fleet could offer extensive in-car experiences commensurate with each of these classifications.

So, for those auto brands who see the future, moving from sheet metal and speed need not be the end of the world. But it will take a definite shift in orientation, and a deep understanding of their brand heritage and how that heritage can help them uniquely fulfill in-car customer needs.