Dma14 rob and richard keynote final slideshare

Trust, Transparency and Ice Cream

Using Business as a Force for Good

Rob Michalak,Global Director of Social Mission

Richard G. Rosen,President & CEO

Thursday, October 23, 14


I believe we are in the midst of one of the most dramatic and overarching shifts in marketing and advertising we will see in our lifetimes.


I want to talk to you today about a world where businesses strive not only to be the best IN the world, but to be the best FOR the world. Where companies that don’t uphold those values are forced to close up shop, where companies that do uphold those values achieve enormous success. That world is closer than you think.

The Changing Landscape

Copyright 2014 Rosen. All rights reserved.

Heightened Competition

Social Media

Concerned Consumers


This change is being driven by three key factors. First, consumer values are changing. They want to support trustworthy companies that are having a positive impact. Next, in today’s highly competitive marketing landscape, genuine values are helping companies stand out in the crowd. And finally, this dramatic shift would not be possible without the transparency of social media, where good companies can be publicly celebrated, and bad companies can be turned into pariahs overnight.

of global consumers believe that business

needs to place at least equal weight

on society’s interests as on business’

interests.


87%ConcernedConsumersConcernedConsumers

Concerned ConcernedConcernedConsumersConsumersConsumersConcerned Consumers


First, consumers are more aware and concerned about the impact of their purchases. 87% of global consumers believe that business needs to place at least equal weight on society’s interests as on business’ interests.

(Sources: 2012 Edelman GoodPurpose Study, Havas Media “Meaningful Brands” Global Report, 2013 Deloitte Core Beliefs & Culture Survey, 2013 Cone Communications/Echo Global CSR Study)

would boycott if they learned of a company’s irresponsible business practices, and...

90%

have done so in the past 12 months50%


ConcernedConsumersConcernedConsumers

Concerned ConcernedConcernedConsumersConsumersConsumersConcerned Consumers


Consumers are taking more active roles these days to show companies they mean business. 90% of consumers say they would boycott a company if they learned of their irresponsible business practices, and 50% have done so within the last year.

In short, today’s customers want to buy good products from good companies they trust, that also reOlect their values and lifestyles.

(Sources: 2012 Edelman GoodPurpose Study, Havas Media “Meaningful Brands” Global Report, 2013 Deloitte Core Beliefs & Culture Survey, 2013 Cone Communications/Echo Global CSR Study)

The Marketing Landscape Evolves

Source: Kotler, Phillip. (2000) Marketing Management. Upper Saddle River, New Jersey: Prentice Hall.

HeightenedCompetition


In a highly competitive marketing landscape, not only are consumer values changing, but the marketing landscape is changing as well. Over the last hundred years of marketing, there have been 4 seismic shifts in marketing, the production era, the product era, the selling era, and the marketing era. As more firms adopt the techniques of one era, those tactics become less and less effective.

Well we are actually already into the 5th era, what Phillip Kotler called the Societal era, where companies adopt a triple bottom line approach (people, profit, and planet).

(Source: Kotler, Phillip. (2000) Marketing Management. Upper Saddle River, New Jersey: Prentice Hall.)

Source: Kotler, Phillip. (2000) Marketing Management. Upper Saddle River, New Jersey: Prentice Hall.


Will not be enough

HeightenedCompetition


Frankly, you can have a great product at a great price and have great promotion, but it won’t be good enough in the Societal Era. That’s just par. There are already plenty of firms doing it already. Company values that speak to people’s higher purpose and potential are what provide a new competitive advantage.

(Source: Kotler, Phillip. (2000) Marketing Management. Upper Saddle River, New Jersey: Prentice Hall.)

Social Media

The world will know who’s good and who’s bad

Social Media


The third factor driving this revolution is social media. Social networks are providing customers with an enormous voice, forcing companies to be transparent about their business practices. And they’re using that voice to celebrate good companies and punish the bad ones.


Social Media


An example of irresponsible business practices showcased by a customer is United. And they paid the price - United Breaks Guitars.

Here’s what happened: A singer/songwriter named Dave Carroll was flying United. As he was getting ready to get off the plane, he heard another passenger say, “My God! They’re throwing guitars out there!”

As Dave and the other band members looked out onto the tarmac where the luggage was being unloaded, they recognized their guitars. Their reaction was a blend of terror and disbelief.

Later he indeed discovered that his $3,500 Taylor guitar’s neck had been broken.

What followed was a customer relations nightmare. Dave tried for nine months to get a claim processed with United. The response was a firm and consistent “no.” They claimed he had waited longer than 24 hours to process a claim, so he was out of luck. He tried phone calls. He tried e-mails. He even went so far as to suggest that instead of money, United give him $1,200 in flight vouchers to cover the cost of repairing the guitar. United held firm. They said “No.”

Ultimately, United didn’t compensate him in any way for his broken guitar.

So, what else could a singer-songwriter do? He wrote a song titled “United Breaks Guitars.” He put it up on YouTube and it went viral. It has over 14 million views.

The BBC reported that United’s stock price dropped by 10% within four days of the release of the video – a decrease in valuation of $180 million, from just one person’s bad experience. This is the enormous downside potential of not acting with integrity.


Social Media


But if that’s the downside potential, the upside potential of relying on genuine values is even greater.

ALS challenged people do do something simple - pour a bucket of ice water over their heads, and donate to the ALS fund.The results? Over $100 million in donations in just one month! (http://www.forbes.com/sites/dandiamond/2014/08/29/the-als-ice-bucket-challenge-has-raised-100m-but-its-finally-cooling-off/)

Success = Blend of Profits + Social Purpose



In this changing landscape, the companies that have sustainable success will be the ones that blend profits and social purpose, like the ALS ice-bucket challenge. Because people crave empathy - they want to be a part of something that’s bigger than themselves, that makes them feel empowered.

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So...as a marketer,

Care?Thursday, October 23, 14

We’re good at spinning marketing tools.



As marketers, we are all really good at talking analytics and spinning all the online and offline tools essential to marketing - social media, email, direct mail, etc etc. This will always be a necessary part of what we do.

Values add another layer to our messaging platform

Brand Direct

Awareness Behavior

Convergence

Higher Purpose

Hearts and Minds


And for years, I’ve been talking about what I call Convergence - combining both disciplines of Brand and Direct marketing. Convergence gives you the power necessary to build awareness and change behavior at the same time. I’ve said for years that we have to use these 2 disciplines plus empathy and authenticity to start a dialogue with your customers. To gain that trust.

Now we can overlay higher purpose to capture the hearts and minds of customers as well. This adds a whole other layer to our brand messaging platforms. It will give an improved level of meaning that includes transparency, authenticity and empathy. This new layer onto our brand briefs will drive customer dialogue and ultimately win long-term relationships.

To win their Hearts and Minds, we must stand for genuine values.



By incorporating this other layer of genuine values into the fiber of your brand, you will win the hearts and minds of consumers. It will spark that greater connection with your brand, and increase interaction rates leading to sales.


A great example of a company who has incorporated genuine values into their brand is Ben & Jerry’s.


Ben and Jerry started their business in 1978 as a community ice cream parlor sitting on a city center street corner. They knew they wanted to form a deep connection with the vibrant community in the area.


In 1988, when Ben & Jerry’s reached its 10th Anniversary and the business was growing, Ben, Jerry, and company leadership, wanted to institutionalize a linked prosperity business model that stood on three pillars. One of these – the Social Mission – was the first time a large company put a social purpose alongside the economic and product missions. Leadership knew this would be an ever evolving business model. The idea was that as the company grew and prospered, all of its stakeholders, throughout the value chain, would prosper too.


From the earth, to the seed, to the farmer, through manufacturing and delivery of products to the marketplace, to engagement with consumers and the general public, Ben & Jerry’s seeks to make business decisions that create prosperity throughout its value chain. Prosperity means many things at so many levels so Ben & Jerry’s takes a holistic approach.


Ben & Jerry’s believes that it’s OK to have a sense of irreverent humor, perhaps a bit of tongue-in-cheek, in the way it engages with fans and the public at large to bring the issues of today to a new level of public awareness and discourse.

Over the years, the company has brought many demonstrations, often in altered forms such as polar bears and cows, to the halls of power, to bring voice to and shed light on issues that might have been buried under layers of mind numbing bureaucracy and governmental paralysis.

Builds Value by Starting with Values



As part of its contract with its customers, Ben & Jerry’s strives to have an honest and transparent relationship that builds trust over time, which builds loyalty over time. The more transparent and courageously honest that relationship is, the better. Ben & Jerry’s reports its annual social and environmental activities each year, complete with a third-party audit of the major initiatives. They Publish the findings, good and bad, for all to see.

Who Are the BCorps?


Who are the B Corps? They are approximately 1200 companies around the world - encompassing both small (Pacific NW Kale Chips) and large businesses (Patagonia, B&J, Etsy) and both product and service companies.

The community is strong and growing. BCorporations take a stand for genuine values and try to be the best FOR the world. B Corps are engaging consumers as partners in creating a brighter future while making money at the same time.


The B Corp assessment is a great compass to see how your company is doing right now, and where it could improve.

“Customers will choose brands that make a difference. We’re seeing this first hand as sales increase for purpose-driven campaigns. Successful companies in this new world prove that doing good leads to doing well. Business imperatives demand it. And CMOs will relish it.”

- Pam Larrick, CEO of Javelin


Marketing leaders, like Pam Larrick, CEO of Javelin, are already doing this. Currently Javelin is the agency for AT&T, Hyatt, and ING.

Companies with Strong Sense of Purpose outperform

Companies without Strong Sense of Purpose

Investor Confidence

Community Support

Employee Engagement

Client Trust

Source: Deloitte



As you can see through this graphic, having a strong sense of purpose is more than feel-good window dressing. Not only is it good for marketing, but it’s good for your business. Taking a stand for genuine values and having a strong sense of purpose gives your brand a competitive advantage. This graphic compares organizations with a strong sense of purpose (in blue) to organizations without a strong sense of purpose (in green).

Ultimately Bcorps and companies with a strong sense of purpose instill greater confidence in investors, receive support from their communities, establish more trust with their clients, and have more engaged employees.(Source: Deloitte)

Over 40 studies now conclude that higher standards of social, environmental and governance

practices reduce financial risk and create long-term profitability.



Over 40 studies now conclude that higher standards of social environmental and governance practices reduce financial risk and create long-term profitability. And who are the Birkenstock-wearing hippies conducting these studies? They’re Goldman Sachs, Deloitte, The Economist, McKinsey & Company, MIT, and others.

1. The Changing Landscape...

Consider...

2. Great product, great price and great promotion will not be enough.

3. Engage hearts and minds and follow Ben & Jerry’s lead--Take a stand for genuine values.

4. Your brand will be more relevant when you embrace profits and social purpose.

5. Become a B Corp. It’s good marketing, good for your business, and will give your brand a

competitive advantage.


Heightened Competition

Social Media

Concerned Consumers


Take the next step: Visit rosenconvergence.com/DMA14

Rob Michalak, Global Director of Social Missionwww.benjerry.com

Richard Rosen,President & CEO@richardrosen


http://www.ben

http://www.ben

Join us for a FREE scoop of Ben & Jerry’s in the DMA Village, within the

Exhibit Hall.
