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Archives for April 2012

Ten Principles for a New Economy 3/3

(This concludes the Ten Principles for a New Economy series, based upon the New Economy Network publication Principles for a New Economy“.  Part one and part two looked at the Ten Principles in detail; this post looks at four things a new economy should NOT be.)

The first two posts in this series looked at Ten Principles for a New Economy and how these could fit into today’s business environment.  This last post looks at four things a new economy should not be.

The Ten Principles document states that:

“the purpose of an economic system is to organize human activities in ways that support healthy and resilient communities and ecosystems for both present and future generations”

It then goes on to describe how current global, regional, national and global economies have failed.  In today’s language the economy is largely made up of for-profit businesses, so if there is any fault to be found in the economy then it also points to faults within how businesses conduct themselves.

These failures show that businesses, along with the wider economy, are currently: [Read more…] about Ten Principles for a New Economy 3/3

The Evolution of Influence in 16 Minutes

For brands, influence matters. It really matters. But how does a brand gain influence and develop an audience of influential brand advocates?

Amplify created a short film called FanCulture that explains how the relationship between brands and consumers (i.e., fans) grows and how that relationship evolves into increased influence. The video features branding experts and academics as well as “superfans” of brands. Amplify says that the video is intended to help brands learn how to move from logo to cultural icon by cultivating a powerful relationship with consumers.

The video is also a great example of effective content marketing through online video storytelling. As you watch the video below, consider how you can create similar content related to your brand and business to offer useful, interesting information to consumers, clients, vendors, and so on. That’s what content marketing is all about.

The concept of superfans and brand influence isn’t a new one. The Amplify video talks about brands as diverse as The Beatles to Nike. Regardless of the industry a brand is in or when it debuted, consumers can become emotionally involved in that brand, develop loyalty to it, and ultimately become powerful brand advocates. Their influence can create a form of word-of-mouth marketing that money can’t buy.

As Sheila Shayon wrote on BrandChannel, “Engaging enthusiasts and brand ambassadors should become more than just buying “Likes” on Facebook.” Getting people to like your brand is just the first step. In fact, likes are meaningless if the people who like your brand aren’t emotionally connected to it. Look beyond likes and you’ll see your brand advocates increase and your brand influence grow.

Ten Principles for a New Economy 2/3

(This post follows on from Ten Principles for a New Economy 1/3 and covers the second 5 principles in the New Economy Network’s Principles for a New Economy (PDF) )

Taming Finance

“All monetary systems and financial institutions shall be regulated as essential public utilities for the benefit of society as a whole, and for nurturing the real economy.”

The two key phrases here are “essential public utilities” and “real economy”.

One core reason there was a financial meltdown in 2008 was because the real economy (the actual production of goods and services) had become secondary in financiers’ and politicians’ minds to the buying and selling of shares, options and positions on the financial markets.

This is like expecting a car to drive as fast as possible irrespective of the engine put into it.

Another core reason, and arguably a much more important one, is that finance remained essentially in the hands of a few people even though it’s almost impossible to survive in today’s capitalist society without getting into debt.  It is, in effect, a utility required by society in order to function correctly, and so should be treated as one.

This is a good moment to pause and reflect on why these Ten Principles are actually “good stuff” and worth taking on board.  They’re not anti-capitalist or pro-socialist … there’s no mention in there of nationalising banks, and there’s no concept that capital investment wil always be for society’s good.

Like sustainability, these Ten Principles push businessmen and economists beyond the left/right wealth and class arguments of the past century and look instead at how politics and finance can be shaped in a way which reflects today’s multi/social media society .. not the society of our great-grandparents who barely knew what a letter or an automobile was.

Enhancing Fairness

“Significant economic inequality shall be understood to be inherently and profoundly antihectical* to achieving human and ecological well-being, and shall be rapidly reduced.”

One of the deep flaws of the market economy is that it relies upon economic inequality.  This is why we’ve had cheap goods from China for so long and where there is now a rush to market at the “Bottom of the Pyramid”.

There will always be social and economic inequality .. that’s the nature of the beast.  However whether that inequality translates to unfairness is a different matter.  There are plenty of examples around, from a privately educated child who’s expected to write 10 pages on the solar system vs a publicly educated one who’s expected to write one sheet of A4 on one planet, through to the withdrawal of the Colombian candidate from the race to be President of the IMF because he felt the contest had become politicised.

Equality has to mean equality of opportunity, not equality of income, wealth or social standing.  It is how the economy is run and regulated which allows people to make their way according to their desires and abilities, not their background, race, gender or class.  Today financial return is allowed to trump these equitable considerations,  and that makes the economy profoundly unfair.

Providing Fulfilling Livelihoods

“Individuals shall be assured of substantial opportunities for decent paid work, employee ownership, and the right to organize in the workplace, and shall be accorded proper recognition for work performed outside the formal wage economy owing to its fundamental role in enriching community and family well-being.”

In other words: no more slaves, no more servants.

Many people’s quality of life has deteriorated significantly over the past 50 years or so.  Gone is the suburban commute of Reggie Perrin (or even the consummate breakdown) and in are long working hours, evening and weekend toil and the sacrifice of personal fulfillment over professional advancement.

Employees at all levels must have a significant voice in how the business is run, have opportunities made available to them as they arise and should be able to count their professional training as part of their working day.  This is the only way in which a proper work-life balance can be achieved.

Fostering New Values

“Economic values shall be redirected, by all fair and reasonable means, away from excessive materialism and shifted towards values that prioritize flourishing communities, individual happiness, and a healthy and resilient world based on lower material flows”

The economy, through consumerism and capitalism, has become an engine through which luxury is sold to those who can least afford it, no matter where on the income scale those consumers sit.  This emphasis on luxury means that people are encouraged to get into debt in order to gain more material possessions.

In the meantime pubs and corner shops are closing, effective working hours are increasing and social media is exploding. There is no halcyon of yesteryear which we should try and restore, but we need to look very carefully at how the need for stuff is driving us apart and causing us misery.

The values which are being inculcated into our communities are driving us apart, reducing our ability to meet each other face to face and driving brand-orientated wedges between sectors of society who could otherwise get on with one another.

A new set of values are needed which will put the community at the forefront and enable people of disparate background and wealth to view one another as equals.  These are the new values of the new economy.

Redefining Globalization

“International economic relations shall rest upon the same principles enumerated above that apply to economic activities within nations, such that economic justice also becomes embedded in such relations.”

Globalisation, like capitalism, is a fact of life today.  Get over it.

However globalisation, like capitalism, has to date been driven by the near medieval need to make profit and dominate communities.  Thanks to the liberal policies of yesteryear this trend has also gone hand in hand with a desire to educate and enlighten the local population, meaning that people around the world now realise they have been taken advantage of, used and abused in order to make a few people at the top even more wealthy.

I’m not going to say “this has to stop”.  To do so would be like condemning a farmer for sowing his crops because he then has a monopoly on selling his farm’s produce.  Out of his own effort he has produced the basic nutrition upon which we all rely.  Of course he has a right to retain power and control over his own farm, but he would rightly be condemned for withholding produce on the grounds of who could pay for it and would be doubly condemned for making healthy sustenance a luxury item.

The simile extends quite happily into the economic environment.  Any part of the economy should address the public need and provide tangible benefit to the community addressed.  This is where globalisation has gone wrong.  Big brands, from sports goods manufacturers to peddlers in nicotine and financial advisors, see nothing more in globalisation than an opportunity to sell their product or service for a centralised profit.

It may be their only community involvement is that they’ve brought their brand into a new community which will better that community because, um, they’re now buying that brand.  Or, perhaps, a vanishingly small proportion of the profit made from selling in that community will be reinvested in it. Wonderful!

Globalisation needs to be redefined, and with it the very premise of capitalism.  The use of capital to support and invest in businesses should be primarily to build a a more equitable and resilient economy for the good of all concerned. This is the change of values which is needed, and globalisation should see it propagated the world over.

*antihectical is a remarkably obscure word, even for an essay on economic principles.  I’ll leave to you to look up for yourselves, but suffice to say its meaning is self evident by its context

(This is part 2 of Ten Principles for a New Economy.  Part one can be read here; part three will look at the four things a new economy should NOT do)

Picture Credit: Meeting image from the New Economy Network website

Real Impressions Drive More Display Ad Conversions than Clicks

click throughFor years, marketers have relied on two primary ways to track the ROI of online display ads — clicks and impressions (based on how many times the ad loaded regardless of whether or not a person actually saw it). New research from comScore and Pretarget suggests that relying on clicks and traditional display ad impression measurement is a bad idea.

According to the research report, these metrics don’t account for the number of people who convert to a sale or a request for information after hovering over a display ad or engaging with it without actually clicking on it. In other words, traditional display ad ROI measurements are inaccurate because it’s missing critical data related to conversions absent of clicks.

A comScore press release explains the following findings:

“The research findings indicate that the traditional way of buying mass impressions and hoping for conversions (aka “spray and pray”) is not the most effective approach. The results showed that ad hover/interaction (correlation = 0.49) and viewable impressions (correlation = 0.35) had highest correlation with conversion, while gross impressions (correlation = 0.17) was significantly lower. Perhaps most interestingly, clicks (correlation = 0.01) had the lowest correlation with conversion, far under-performing all other metrics analyzed in the study. These findings suggest that advertisers and media planners ought to break their addiction to clicks and instead look to more meaningful metrics for evaluating campaign performance.”

This isn’t the first study to find that clicks don’t correlate to conversions at a rate as high as hovers do. In its 2009 Benchmark Report (released in July 2010), MediaMind reported that, “on average, increasing Dwell [hover] from 5% to 15%, increases conversion rate by 45% from 0.4% to 0.6%,” and Casale Media reported in its 2011 Ad Visibility Report that ads displayed above the fold were nearly 7 times more effective at driving conversions than ads displayed below the fold.

Bottom-line, relying on click metrics is selling your campaign short. You won’t get the full story, and it’s highly likely that far more conversions are being driven by hovers and engagement with display ads placed above the fold than you realize. As Kirby Winfield, SVP of Corporate Development at comScore explained, “It’s time to start measuring the impact of campaigns using metrics that really matter, not just the ones that are most easily measured.”

Of course, until more brands get access to the tools that can measure hover engagement, clicks will remain the go-to metric for measuring display ad effectiveness. However, companies that invest in this type of advanced data collection and analysis will come out on top in the end.

What do you think? Share your thoughts by leaving a comment below.

Image: Ariel da Silva Parreira

Ten Principles for a New Economy 1/3

One of the wonderful things about the new networked globalised economy is how you suddenly discover the links which exist between one business and another.  This can have both productive and detrimental effects on a business, depending upon your point of view.

For example, take Apple’s highly publicised involvement with Foxconn.  The good side is that Foxconn allows Apple (and other tech manufacturers) to access the cheap Chinese technology manufacturing market.  The bad side is that there has been a spate of suicides by Foxconn workers which, whether relevant or not, will stick to Apple as a negative influence upon their brand.

Another “wonderful thing” is finding out the different aspects of a corporation when you’ve only known one. Take, for example, the New Economy Network (NEN).

NEN was founded by the Tellus Institute in 2010.  It comes from the same stable as the Global Reporting Institute (GRI), which is now a de facto sustainability reporting tool amongst businesses.

However, whilst many companies may support the GRI reporting regime I suspect few would put their wholehearted weight behind NEN’s Principles for a New Economy (PDF).  Why?  Because, like any Tellus Institute initiative they cut against the establishment’s grain.  To understand this more fully, let’s look at the principles in more detail:

[Read more…] about Ten Principles for a New Economy 1/3

Brands Focusing on Video in Content Marketing

Content marketing spending has more than doubled in the past ten years, and new research from ContentWise and the Custom Content Council reveals that North American marketers spent over $40 billion in content marketing in 2011. Print content still dominated content marketing budgets in 2011 with 58.7% of budgets directed at the print medium. However, within electronic content, video is a critical focus for many marketers in 2012.

Following are statistics from the study that provide insight into which content opportunities brands focused on in 2011 (via eMarketer):

  • Print = 87%
  • Website updates = 82%
  • Email newsletters = 71%
  • Branded video = 52%
  • Virtual events = 38%
  • White papers = 38%
  • Podcasts and other audio = 24%
  • Ezines = 15%

In 2009, just 37% of survey respondents were creating branded video. Two years later in 2011, 52% were creating branded video. If budget reports hold true, you can expect to see a lot more branded video over the course of 2012.

54% of respondents to the survey indicated that they plan to increase spending on video content in 2012. Virtual events are also getting attention (35% plan to increase budgets for virtual events), and podcasts and other audio will also get a bump in budget dollars (31% expect to increase budgets for audio content).

It could be argued that the interest in branded video content has little to do with marketing foresight and everything to do with cause and effect. In this case, the cause came from two sources — the need to reduce budgets and the consumer behavior shift to the online space. The effects were for brands to shift their budgets to the online space where their audiences now spent time. Since content marketing online is typically less expensive than print content marketing, budgets also decreased.

While branded video is the hot thing these days as more people use smartphones and tablet devices for more aspects of their lives, including watching video content, the smart marketers will be using foresight rather than reacting to cause and effect. Consumers are already shifting to the mobile space. Brands need to adapt their content marketing strategies to match that shift. Will your brand be leading the way in the mobile content space or still catching up with video content?

Video is certainly not dead, but if video were a teenager, it would already be losing its level of cool. Of course, marrying video and mobile is the ideal solution, and it’s what consumers are going to expect in the near future.

What do you think? Leave a comment and share your thoughts.

Image: Boulanger Julien