The future of advertising

By Madushka Balasuriya

It was the best of times, it was the worst of times. Alas, this is no Dickensian tale but arguably the most apt way to describe the present state of affairs surrounding advertising and marketing. A cursory glance on the internet and it wouldn’t be too difficult to spot the latest advertising faux pas by some local, or possibly even global, brand. The most recent and widely publicised was that by Pepsi, where in an attempt to jump aboard the social justice bandwagon they plainly forgot all common sense and self-awareness. The backlash to a campaign seen to belittle the very real disconnect between police in America and those they are supposedly there to protect, was so great that even the thick-skinned social media all-star Kendall Jenner was not immune to it.

On the face of it, it’s pretty obvious why the Pepsi ad was not well received; all you have to do is watch it. The lack of tact, sincerity, and the all-too-obvious attempt to attach its brand to a real-world problem was rightly condemned as in bad taste. Yet, while that execution was clearly flawed, the idea behind it was inarguably correct.

As Dickens would no doubt agree, brands in the 21st century have almost limitless means when it comes to marketing their products to potential consumers. With the advent of social media and the wide proliferation of the internet, advertising is impossible to avoid. But with this greater exposure has come a savvier, more discerning consumer, one that knows they are being marketed to and will only dole out hard-earned cash if they feel the brand meshes with their ideals.

This high wire act is something that ad agencies around the world are only just coming to terms with, and according to Leo Burnett South Asia Chairman Saurabh Varma, that balancing act is one that agencies in his part of the world will soon need to acquaint themselves with intimately. 

Speaking at a specially organised round – nay, rectangular – table luncheon at Leo Burnett’s head office in Sri Lanka, Varma addressed an exclusive audience made up of some of the agency’s top country clients and offered them a glimpse of how they would need to approach their marketing in the very near future.

Solving problems

The most striking aspect of Varma’s presentation was that it primarily consisted of videos – videos of great ads. No, this was not an act of laziness, but a shrewd ploy to effectively get across what a good advertisement hopes to accomplish. It gets you to feel an affinity for the brand and the work they accomplish; it makes you want to be associated with it as a consumer.

This intangible quality all great ads possess was the essence of Varma’s presentation, and through that he outlined a few themes he sees emerging across the global advertising landscape. The first of which was problem solving. 

The most successful brands, he explained, connect with people by solving a real-world problem, the key being that they do so with a clear purpose in mind. This marriage of purpose and action is essential, says Varma, in that one should not exist without the other. 

“If you do lots of acts but you don’t know what your purpose is, chances are you’re not going to succeed. In fact, it is better to do less till the time you define your purpose.”

That to do nothing, as opposed to doing it wrong, is the better of two evils says all you need to about the world we now inhabit. A poorly received campaign is code red territory for any brand these days, with social media users eager to pounce and compound the issue with relentless memes and jokes; this is only mitigated by a full and contrite apology and that too only sometimes.

Pepsi can attest to being on the wrong side of a poorly conceived campaign, however brands such as Volvo have in recent times shown how to do it right. Volvo’s efforts to increase road safety for cyclists through the innovation of glow in the dark invisible paint sought to resolve a major problem, despite it not directly affecting their car manufacturing business.

“Volvo has always been about safety. That has been their purpose but they needed an act to prove that that purpose can come to life. So they took on a very simple problem of road safety for cyclists.

“It’s amazing that they’re not in the cycle business, they’re not in the paint business, but an act like that helps you sell more cars. All it does it reinforces your equity around safety.”

This is what Varma refers to as becoming a ‘humankind’ brand, one which is both clear in purpose and action. It’s success is also backed up by hard data, with a worldwide study conducted by Leo Burnett across 16 countries and some 60,000 people, showing that consumers are reacting positively to brands which genuinely try and do good.

“As you start becoming a humankind brand, data is indicating that you actually get twice the market share of a non-humankind brand. Every piece of data we’re seeing, quantitatively is showing that.” 

Commoditisation and ecosystems of value 

Another emerging theme across markets is that of the creation of ecosystems of value, or to use a less sexy term, functional integration. The goal of functional integration is to offer more value to a consumer by enticing deeper participation with a particular brand.

The best example of this is Apple, and how from being an outside player in the PC market they went to dominating, not just one but, multiple industries – and it all began with iTunes. The iTunes store made Apple the biggest digital music retailer but also incentivised consumers to dive deeper into their ecosystem of products with the iPod, iPhone and iPad. In the process their computer business also began to flourish. The functional integration business model is so successful that, it is now adopted across the board by tech, and even some traditionally non-tech, companies such as Google, Amazon, and Nike.

In the West, another reason the functional integration model has taken off is due to the saturation created by its older siblings – horizontal and vertical. Both horizontal integration, which looks to dominate competitors across a particular category, and vertical integration, which seeks to gain control of all parts of the supply chain, have led to a phenomena known as commoditisation.

Commoditisation refers to when consumers have so much choice across a product category that they don’t see a great difference from one brand to the next. This, unsurprisingly, makes it difficult for brands to charge a premium and, in the long run, grow. As a result many brands have been shifting their focus to developing countries in the East and Asia, where there are still untapped markets.

This phenomena of commoditisation is not only true for brands, but also for agencies. Things that many ad agencies were doing for decades in mature markets are no longer as effective as it once was. Varma points out that while this shift has not yet taken place in the developing world, the change is imminent. 

“This is a massive shift that is happening, and you know we may be underestimating how quickly it’s going to come to our markets. You look at the West, they’re all suffering due a lack of growth and it’s all because of commoditisation. The lack of differentiation is really creating a massive pain across the entire ecosystem. And this will come to our world very quickly. 

“At the moment we still have a robust GDP but we’re all betting that we will skip some cycles, we will not have the same kind of curve as other parts of the world. So brands are going to have to move very quickly to create functional integration, without which you will not be able to create the value for consumers to be part of your brand.”

Context of today

While both creating ecosystems of value and solving important problems, successful modern brands are also capable of thinking on their feet and reacting to the changing world on a daily basis.

“Brands have a huge opportunity today to be quick, nimble, and fast on the back of what’s happening in the world on a daily basis. We don’t have the opportunity to think about the three month, the six month, the one year kind of campaign periods because consumer lines are changing so quickly, they will change opportunities and challenges for you on a daily basis.

“The battle will be won on a daily basis. Brands have to react to news at the speed of light,” says Varma.

This is exactly what Leo Burnett India did when news broke of the Indian government’s plans to scrap the historic Indian aircraft carrier, the INS Vikrant. Despite a public outcry the scrapping of the warship went ahead, much to the dismay of several Indian war veterans. This however presented the agency with an opportunity.

They approached Bajaj, a client of theirs, who agreed to salvage the scrapped metal from the ship and make a range of motorcycles out of it. Having launched in a segment in which there had been 32 failures in the previous eight quarters, the bike went on to make half a billion dollars in a single year.

“For us the risk of Bajaj was nearly zero. Only (negative) thing that could have come from this was that people would say ‘you’re using an occasion like this to sell bikes’. But we never hid from the fact that we wanted to make bikes, because that’s what we do at Bajaj. For our client the only way to honour India’s warships was to make bikes. So we’re being authentic to what we did. 

“When you’re being honest to yourself these ideas normally work out well. I think when there is a lack of authenticity and integrity that’s when you get caught out on the other side of the message.”

As Varma implies, the use of current affairs as part of a marketing campaign can at times come across as in poor taste, however if done in a manner in which the consumer does not feel tricked or manipulated it has the potential to be an unqualified success.

“Brands are actively taking on human problems. This is becoming a huge theme globally, with brands asking themselves, ‘How do I take a problem and solve it, and attach myself to that problem?’.”

This may leave a bad taste in mouths of some, however it is an undeniable fact that an increasing number of modern consumers want to feel like their money is going towards something worthwhile. Consumers aren’t naive, they are aware that brands profit of their CSR initiatives. What they desire is a story to tell themselves, and that’s where the best campaigns standout. The magic truly is in the narrative.

Pix by Lasantha Kumara