Why it was smart of Havas to buy Victors and Spoils

Victors & Spoils has had no problem attracting clients

When Victors & Spoils was first launched two-and-a-half years ago, the company had more detractors than fans. (Note, I was among the latter.) Much of the industry dismissed the idea that the model could ever replace the traditional agency/client relationships. The more vocal members of the creative community found all kinds of reasons to condemn the new company. The talent wouldn’t be as good. The whole idea of crowd sourcing would undermine the value of the creative person. The best people wouldn’t submit to this kind of process and platform.

Co-founder/CEO John Winsor and I had numerous conversations about why the critics were wrong. Great ideas can come from anywhere. Plenty of people would welcome the chance to have their ideas considered. (After all, how many of us encounter a daily dose of rejection already?) Clients had tired of paying for overhead and some of the excesses of the advertising industry.  And since agencies could only sell the talent they had on staff, by definition they were limited in the number of ideas they could generate to solve a problem.

Clearly, John and his partners were a step ahead of the critics. From day one the agency met with success.  Thousands of creatives from all over the world joined the community.  And the agency’s pitch resonated with lots of clients. Dish, Discovery Channel, GAP, General Mills, Harley Davidson, Virgin America, Levi’s and a host of other brand name advertisers signed on.

And why not?  They could get a slew of ideas — curated, filtered and on strategy — for a lot less money than they would pay in a typical retainer relationship.

From the very beginning I thought this was the perfect acquisition for a holding company. Think about it. Holding companies serve large global clients. They make the claim — sometimes actually true — that they can harness the collective the resources of multiple sister agencies to serve a client’s total needs. Yet they really don’t have a model, infrastructure or software platform for doing so. Ask anyone who has participated in a cross agency (there’s a more disparaging word for it) shoot out and they’ll tell you it’s among the more miserable experiences in which you could ever participate. In many cases it wastes time and resources. And for the individuals encouraged (if not forced) to participate it often results in nothing more than demoralization.

But with Victors & Spoils platform — the community, the software, the process — it could be so much more efficient. A holding company can tap into an existing community, create a new one, invite more people to participate with less time and effort, and effectively manage and evaluate more submissions. Add some incentives or gaming dynamics, make it easier for people to throw in ideas, and it’s likely that participants might even welcome the opportunity to help the company cause. Perhaps more importantly, clients might have a genuine reason to believe that multiple agencies could work together on their behalf.

Until now, most ad agencies have been threatened by Victors & Spoils. They’re perceived to undermine the value of individual creatives, diminish the role and impact of the creative director who hires and guides them, and convey to clients that there might be a better idea outside the walls of the agency.

But if, in the end, our job is to solve big problems, deliver the best and most effective idea, and leave no stone unturned in determining it, maybe we should all acknowledge that community, software, and yes, crowdsourcing techniques, are the way to go. Maybe not always, but certainly sometimes. Add to that the fact that we really only have two choices — resist progress or embrace it — and we have even more reason to welcome the innovation that V&S has pioneered over the last two years.

John Winsor, Claudia Batten and Evan Fry had the vision and the courage to try and change how ad agencies work. Looks like the big holding companies — at least one of them – is starting to believe they’re onto something.

The interest graph is coming. Eight ways to get ready.

Social networks like Facebook start with your friends and let you see what you have in common.  Interest graph-based models – Springpad, Pinterest, Get Glue – start with your interests and then let you make connections. It’s less about who you know and more about what you care about.

Platforms attempting to capture and map the interest graph are the next big trend in social media

If you happen to have your Google alerts set up to grab the latest blog posts and articles about Pinterest, you’re stream is pretty well populated these days. Add “Facebook Actions” or “Springpad” or “Svpply” or “Hunch” and it gets even more crowded.  Maybe that’s why I don’t dare add queries for Google’s new privacy changes or developments like YouTube’s original channels. It would be more than anyone could possibly bear.

With each passing week, the social web evolves. Now that we’ve supposedly mastered Facebook and Twitter, we’re confronted with Google + and all the new interest graph platforms mentioned above. Are we ready? Do we know what to do? Do we have a strategy in place?

Recent research that Mullen just conducted suggests not. We surveyed 160 CMOs and marketing chiefs to find out where they stood when it came to using social media, monitoring the stream, developing conversation strategy and having a plan for tapping the interest graph.

We were surprised at some of the results.

Marketers remain challenged by social media

While 87 percent of respondents claimed that social media was somewhat or very important to their marketing efforts, most of their efforts remained limited to, or at least focused on Facebook. Nearly 80 percent were committed to the world’s largest social network. But fewer than 20 percent were using Google + and a full 80 percent had no focus at all on a platform like Foursquare.

While ongoing engagement emerged as one primary objective (64.5 percent noted it) marketers declared their number one reason for using social media was to generate awareness (76.8 percent), an objective that beat out both customer support (29.7 percent) and building loyalty (53.5 percent).

Among the more disappointing, but perhaps expected findings was the fact that marketers measure success primarily by how many followers and/or likes they generate (71.6 percent). By comparison, downloads (24.5 percent), share of conversation (25.2) and referrals (35.5) remained far less important. The latter is particularly surprising given the social web’s built in ability to inspire word-of-mouth marketing and the sharing of recommendations.

When it comes to content, marketers continue to think like traditional advertisers. They primarily use social platforms to promote products and offers (67.5 percent) and to deliver updates (64.9 percent). Providing utility (33.1) and offering entertainment (22.7) remain far less important concerns.

Despite the flurry of press coverage on the emerging importance of the interest graph, nearly half or respondents (48.7 percent) never heard of the term “interest graph,” and when they had it explained – the ability to connect with consumers in a more meaningful way by tapping into their interests – only 26.6 percent thought it could be “very useful.”

As for all that buzz around Pinterest, a platform generating page views, user growth and inbound links for the early adopter brands? Close to half of our respondents (42.2 percent) never even heard of it, while barely a sliver (4.5 percent) had started using it.

Perhaps that’s no surprise given that 68.8 percent of marketers surveyed capture no interest graph data at all — not preferences, interests, or intentions.

Finally, while brand stewards aren’t quite overwhelmed with the proliferation of platforms, they (44.2 percent) struggle with one fundamental challenge – where to put their resources.

According to a recent Mullen study, most marketers don't capture interest data

From the social graph to the interest graph

The last finding surprises no one. Getting social media efforts to deliver hard results and ROI is a challenge for the simple reason that most consumers aren’t there to connect with brands and their advertising messages.

But the interest graph platforms can change that. If marketers can suddenly identify people who’ve raised their hands and virtually asked for a “proposal,” they can more easily connect with people who’ll welcome them.

Every social network knows this is the future. Facebook Actions now allows users to tap into and identify friends’ interests — music, tastes in foods and preferences for movies, books and more. Presumably, if you actually know what friends have good taste in music it will now be easier to call on their recommendations. Actions aren’t perfect, however.

You still have to scroll through the stream and most content isn’t really persistent, meaning if you miss it in the stream it’s gone. It still poses challenges for marketers, too.  Check out your own page and refresh it a few times. I guarantee that you’ll find the majority of ads that get served to you are completely irrelevant.  But the promise is significant. Facebook will inevitably get better at capturing even more data and presumably allow advertisers to more accurately focus messages.

Foursquare, which our research told us is barely on the radar for most marketers will start making recommendations to its users on where to eat and where to vacation based on past behavior and that of friends. Certainly any hospitality marketer – restaurants, chains, museums and hotels – should at least be exploring the possibilities, if not encouraging user participation.

But all of this is still new. The social graph as we know it is only a few years old while the interest graph has been a topic of discussion for a matter of months. So what does it all mean? For brands, it’s definitely not too late to be early. Marketers can still get in on the ground level. But they need to embrace it and work to leverage it.

For social media practitioners, there’s work to be done. We need to learn, educate each other, experiment and develop effective strategies and tactics.

Eight steps you can take to get ready

1. Learn the difference between the social graph and the interest graph.  This simple description, by David Rogers writing in Read Write Web might help.*
2. Read Grouped and get a better sense of how influence happens on the social web. The Tipping Point is a fallacy. Influence isn’t what you think it is. Small groups are what really matter.
3. Open accounts on at least a few of the platforms. We would recommend Pinterest, Springpad**, and one other of your choice (The Fancy, Fab, Hunch) just to learn what it’s all about. Don’t commit to any one platform. Pinterest may be hot right now, but it’s too early to own this category and some consider the platform of the month a bit one dimensional.
4. Take the time to learn what constitutes appropriate and effective conversation strategy on these new platforms. (Hint: it’s not simply about publishing content or adding a Spring This or Pin It button to your site.)
5. Pay attention to Google’s new privacy policy and as mentioned earlier Facebook Actions.
6. Look for opportunities to market to the data. We’re a few months or more away from this, but it’s coming.
7. Use the platforms yourself. There is no better way to learn and understand their potential.
8. If you’re at SxSW this year, come to our panel on the interest graph and deferred intent.

*The Social Graph

A social graph is a digital map that says, “This is who I know.” It may reflect people who the user knows in various ways: as family members, work colleagues, peers met at a conference, high school classmates, fellow cycling club members, friend of a friend, etc. Social graphs are mostly created on social networking sites like Facebook and LinkedIn, where users send reciprocal invites to those they know, in order to map out and maintain their social ties.

*The Interest Graph

An interest graph is a digital map that says, “This is what I like.” As Twitter’s CEO has remarked, if you see that I follow the San Francisco Giants on Twitter, that doesn’t tell you if I know the team’s players, but it does tell you a lot about my interest in baseball. Interest graphs are generated by the feeds customers follow (e.g. on Twitter), products they buy (e.g. on Amazon), ratings they create (e.g. on Netflix), searches they run (e.g. on Google), or questions they answer about their tastes (e.g. on services like Hunch).

Your thoughts? Please share ideas, examples or insights as to where you think things are going.

**Note: In addition to my role as Mullen’s chief innovation officer, I also work as Springpad’s chief marketing officer. 

Social media gets interesting

What everyone in Silicon Valley and “Venture Land” conceive of as the real game-changing model involves capturing and capitalizing on the “interest graph. The company that succeeds in doing so would be “close to the Google search paradigm because it would be right in line with demand generation and with discovery that relates to product purposes.” Thus, it is the interest graph that defines the middle ground between Google and Facebook — between search, advertising, and the social graph.

The above paragraph comes from a year-old post in Tech Crunch, following last winter’s Goldman Sachs Technology and Internet Conference in San Francisco.  It was a prescient sentiment for sure.

Just look at the current landscape. The new emerging social platforms are less about the social graph and all about the interest graph. Pinterest, Springpad, Svpply. We’re seeing an evolution from people centric social media (who I am connected with) to interest centric social media (what I care about, want to buy, hope to do.) Users are jumping on platforms like these and others in part because they make it so easy to express one’s self by posting stuff you like or find interesting.  Add in the fun of discovery and the rewards of sharing and it’s likely we’ll see accelerated user growth.

Springpad lets me discover and save stuff I want then finds me the best prices on the web.

For brand and marketers, this is good news. It’s a lot more lucrative to tap into intent and desire than it is to try and penetrate communities where you’re uninvited. Even the best conversation strategists can’t necessarily turn engagement into sales. And it’s become pretty apparent that collecting likes on Facebook will never be the Holy Grail.  Just go to any Facebook brand page and take a look at the metric revealed by dividing fans “talking about this,” by those who “like this.”  The percentages are typically pretty low.  For Harley Davidson half of one percent of fans are paying attention while Old Spice’s number is only slightly higher.

In a recent video Gary Vaynerchuk asks an interesting question. “What’s the Dunbar number for brands?” He notes that most consumers have liked so many brands they don’t even remember which ones. As marketers should know, fans rarely visit a brand’s Facebook page and unless they engage on a regular basis they won’t see brand updates in their stream either.  How many brands can we actually have social relationships with? Ten? Twenty? Certainly fewer than the number of people we engage with.

But we can like or want dozens of products and places. Books we want to read, movies we plan to rent, places we hope to visit, restaurants we know we’ll eat at. Offer that up to a marketer and it’s gold. It’s also likely that the right kind of message or alert or incentive to act, served up in a tasteful and polite manner, will be more than welcome.

Expect to see some pretty interesting (no pun intended) developments in 2012. Pinterest may have great momentum, effortlessly converting consumers’ interests into inbound links for the benefitting brand, but there’s more compelling stuff on the horizon. Springpad, a company whose board I serve on, goes beyond interest to identifying deferred intent, then delivering relevant alerts and information that convert interest to action. That’s a benefit for both a user and the brand whose product or service fulfills an obvious desire. Springpad has a slew of significant enhancements coming in February that will make it even more productive and incredibly social.

No doubt there will be others, too. I recently met a new startup called Aditive that offers yet another way to tap into intent. By making online ads social and shareable Aditive encourages readers to share offers with friends who they know might like the product or promotion being offered.  When executed right, this simple tactic multiples click-through and effectiveness by a factor of 10 because it’s allowing consumers to identify interests that their friends might have.

In March, I’m on a panel at SxSW to talk about deferred intent and the brand opportunities inherent in social media as the interest graph evolves. Between now and then I’ll probably return to the topic a few times.  Until then, I’d love to hear your thoughts, ideas and, of course, your interests.

Thanks for reading.

Other links:

Storify:  The Interest Graph

Lasting companies know how to re-invent themselves

Mike Markkula, right, Apple's first investor and father figure to Jobs. Fired by Jobs in 1997 his parting advice called for re-invention.

Like everyone else in America who still reads I am deeply engrossed in Walter Isaacson’s biography on Steve Jobs.

It’s a remarkably honest and thorough account. It introduces us to Steve’s early influences. It explains the genesis of his design obsession. It reveals his many flaws.

While the entire book chronicles the story of Steve’s life from childhood to the end, every chapter is a story in its own right. You probably have your favorite. The lost battle with John Sculley. The launch of Macintosh. The board trying to kill the best ever Super Bowl spot. (They failed because Chiat Day secretly refused to sell off the media.) Jobs’ questionably hesitant but triumphant return. The complex rivalry between Jobs and his sometimes nemesis, sometimes friend, one time savior Bill Gates. Or on another front, the confrontations with Michael Eisner that prompted Disney to back off its ill-advised attempt to re-write Toy Story.

Readers can cull endless lessons from these stories: how to simplify, how to believe in an idea, how to adhere to standards, how to trust your intuition, how not to back down. In some cases – personal hygiene, treatment of friends and family – we can also learn what not to do.

But one of my favorite lessons doesn’t come from Steve. It’s attributed to Mike Markkula. Upon his official return to Apple in 1997, Jobs fired Markkula from the board and then asked Mike to join him on one of his long walks. Jobs told the former chairman that his goal was to build a company that would endure. He asked Markkula’s advice. Markkula shared this.

“Lasting companies know how to re-invent themselves. Hewlett-Packard had done that repeatedly; it started as an instrument company, then a computer company. Apple has been sideline by Microsoft in the PC business. (by then Apple’s market share had plummeted from 16 percent to four percent). You’ve got to reinvent the company to do some other thing, like consumer products or devices. You’ve got to be like a butterfly and have a metamorphosis.”*

The language and the metaphor may not sound brilliant. But you sure can’t argue with the advice. According to Isaacson, Jobs didn’t say much that day in 1997, but clearly he agreed.

Lasting companies know how to re-invent themselves. I think the same might even be said for individuals.

Got a favorite story from the book of Jobs? Please share. And as always, thanks for stopping by.

Photo “borrowed” from Christopher Dernbach’s blog Mac History.

*Excerpt from Walter Isaacson’s Steve Jobs, page 320.

Google (and Mullen) encourage agencies to “go mobile.”

Utility over messages; one great example is University of Alabama's mobile site, feature GameDay functionality and traffic reports so you don't miss kickoff and tailgating.

I just got back from my first trip to Mobile, Alabama. For most people an inaugural visit to the original home of Mardi Gras would be to hear some really good Dixie Land Jazz. And while I did get in some of that, the purpose in this case was to help Google get all, or at least 500, local businesses optimized for mobile.

To its credit Google and the competent folks at Duda Mobile agreed to Mobilize Mobile, creating optimized sites for free and covering hosting for a full year. The effort makes sense for both Google and the recipient small businesses. Ad Words ads that show up on a Google search made from a smart phone become a lot more effective when they link to a site that “searchers” find useful and easy to navigate. Everybody wins – Google, the business, and most importantly, the user.

The program, going on this week, includes two days of seminars, training, and site conversion along with a little bit of evangelizing. I had some responsibility for the latter, presenting to 200 ad agency and brand folks last night at an event held at Red Square Agency. 

Jason Spero, director of mobile at Google spoke first, covering trends and insights that leave no doubt about the proliferation of devices, changes in search behavior and a plethora of other uses. My job was to remind ad agencies that they need to jump on this opportunity full force while it is still early enough not to be late. An awful lot of advertising agencies were caught off guard with the pace of change brought on by all things digital. Many missed it out again when social media altered consumer behavior forever. Mobile is bigger than either of the previous disruptions and will inevitably affect every section of the purchase funnel, from awareness to loyalty. You don’t want to miss out on this one.

A couple of key facts are worth noting. First from Jason: “The consumer is adopting mobile and all that it offers far more quickly than brands, marketers and small businesses.” That alone should be enough to wake up any agencies or brands that haven’t put the newest digital movement at the forefront of their marketing efforts.

Second, from a conversation I had a few months ago with Joe Ferra, head of Fidelity’s mobile marketing: “Fifty percent of Fidelity trades, transactions and inquiries will soon be made from a mobile device.”  That’s a wake-up call to anyone who thinks this is all about  for 18—24 year olds.  Doubt many of them are trading equities with Fidelity.

And finally, the battle for mobile payments, about to escalate as Google, Apple, American Express all vie for dominance, will end up creating numerous opportunities for retailers. We’ll know who’s in the store, when they were last there, their past purchase behaviors and their current loyalty status. Doesn’t take a whole lot of imagination to see the opportunities in that.

Anyway, below is my presentation. (Or here’s a version with a few notes attached.) Up here in Massachusetts we give the presentations first, then open the bar and start partying. On the Gulf Coast, they party first — kicking out a few jazz tunes and making sure everyone has a drink or two before they invite the presenters up on stage.

But this alternative sequence made my argument for mobile sites even more convincing.  If you think it’s tough to pinch, zoom and navigate an unfriendly mobile site when you’re totally sober, try it after a couple of drinks.  Can you imagine searching from your smart phone for events on Mobile’s Mardi Gras site next February if it’s not optimized for mobile?

If you have a chance, visit the warm welcoming city of Mobile. It’s a happening town. Reminds me of Austin. And for the best grits there, try True’s.