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Marketing is just who might be interested in this thing.
And a lot of it is the fundamental thing is if no one knows you exist, no one's going to be able to buy your thing.
And so marketing is the process of attracting the attention of people who might be interested in the value that you're creating.
And in an ideal world, making them curious, wanting to learn more, asking for additional information, engaging with what it is that you have.
A lot of people conflate marketing and sales.
To me, they're distinct processes.
So marketing is the attracting attention and generating interest, and then sales is the process of convincing someone to buy and then getting them set up as a customer.
And a lot of marketing comes down to what is it exactly that you're trying to gather attention for?
And where do those people generally hang out?
What are they curious about?
What are they already paying attention to?
What can you take advantage of or dovetail into in order to attract someone's attention at the right moment, at the right time, and make them aware that you have something that could benefit their life?
Here's what it is. Here's how you can benefit from it.
Because people, many companies see it as like an annoyance.
Like, I've sold you the fucking thing.
Why are you being mad at me?
And they treat you like you're a nuisance.
Yeah, and that's a shame.
Because really, those happy repeat customers are not just your high lifetime value customers, the customers that will stick with you, keep spending money with you.
They're also a primary source of marketing.
Word of mouth marketing is all happy customers telling other people who might benefit from your product that, hey, here's this wonderful thing, you should probably check it out.
And so yeah, things like post -sale support, sometimes customer reactivation.
So to your point earlier, it's a very straightforward marketing technique called reactivation.
If you can contact Jack and say, hey, you bought candles from us last year, would you like to buy candles from us this year?
And get him to pick up just a couple more candles, like the cost of that promotion is potentially very small.
You already know he exists, you already know that he's purchased.
Can you just get him to do that again?
Those are some of the most effective marketing sales campaigns that you could possibly run.
But it also requires that they had a good experience with whatever it is that you're offering in the first place.
How has the landscape of advertising and a brand building, a reputation changed in your lifetime?
And what is the most important thing for brands to understand now, or some of the important things for brands to understand now, if they are to be successful?
Yeah, so my first job in business school, I started a company called Profit Brand Strategy that's now about 500 people.
Now it's just called Profit.
And the basic notion was it was based on the principles of my professor, my second year, David Ocker, who's considered the father of modern branding.
And it was that the intangible associations with a brand or a set of products or services are the only sustainable advantage.
That if you can wrap a set of products and services with these brand codes of masculinity, European elegance, youth, and then pound away at those associations, using this incredibly cheap, efficient medium called broadcast advertising, you can take a marginal shoe, salty snack, marginal car, and get
amazing margins on it.
So that's been, from the end of World War II to the introduction of Google in the 90s, the algorithm for creating massive shareholder wealth was find a mediocre product, wrap it in amazing brand codes and make people feel more patriotic or younger, stuff the channel with it, and print money.
The PNGs, the Pepsi Co's of the world, the Coca -Cola's, these are the economic titans of yesteryear.
The sun has passed midday on that because our weapons of diligence, whether it's Google or TripAdvisor, Amazon reviews, now gets us to the best product without the benefit of this weapon of diligence called brand.
When I came to London, I used to stay at the Four Seasons from the Mandarin Oriental.
Why? Because someone else was paying and there always an eight.
And then I went on TripAdvisor and I went on my social graph and I found out people love the Connaught Hotel or people love the Ferndale Hotel.
So I started staying at the Haymarket.
Why? I like a place from the nice gym and I want to stay out with, hang out with people who are younger and cooler than me.
So I started staying at boutique hotels.
So all of a sudden, product became the bomb again and then your ability to embrace these new mediums around social became more important than broadcast advertising.
So the traditional metrics of branding, the traditional vehicles for branding, a brand identity and broadcast advertising that I've been preaching and brand strategy.
The sun has passed midday.
If you look at my curriculum and the majority of curriculums and marketing departments, you could argue that we're just training people to go to work at Unilever General Mills and be laid off 24 months later.
Branding has become much more about innovation and actual product quality.
Now that extends into how you discover the product, how you absorb the product, the community around it.
But Tesla is a better product.
Apple used to be an underpowered product with a great brand.
Now it's a great brand with a superior product.
So these things, Airbnb is a much better product.
These things are, Google is 10X better than what was there before it.
So supply chain, design, the way you absorb the product, its ease of use, you know, it's moved from kind of what you would call a brand economy to, for lack of a better term, an innovation economy.
So rather than taking classes on advertising, I say take classes on supply chain or analytics.
Or really understand industrial design.
You know, there was a general feeling that all product quality had maxed out.
And then the internet came along and unlocked all this product innovation.
So cars, they felt it hit kind of a peak in terms of product quality.
And then all of a sudden with the internet and GPS, you could tune a car up wirelessly.
You can unlock the doors.
There was all kinds of crazy things you could do with it in addition to EV.
I mean, there's just been so much actual innovation around the product.
And what are the most valuable companies in the world have in common?
They either spend no money on advertising or they're spending less.
Apple's the strongest brand in the world.
At least a consumer brand, I would argue the strongest brands in the world, universities.
But it's reallocated six or seven billion dollars out of broadcast advertising into its channel, into stores.
It built 550 templates of the brand.
And I think that is almost part of the product.
My 12 -year -old and I were bored yesterday so we went to the Apple store.
So that's kind of consuming the product.
And I ended up buying screensavers and new cases that I'm sure are 90 points a gross margin that I could find a FNAAC or Best Buy or someone for less money.
But we want to be in that store and in that environment.
So it's moving out of pre -purchase broadcast advertising into the distribution channel and into innovation.
But the traditional the traditional norms of marketing or branding as I taught it, that shit's over.
Don Draper has been drawn and quartered.
If you're watching a lot of advertising, it means your life hasn't worked out.
The majority of people who are technically literate or wealthy can avoid 80, 90 percent advertising now.
They watch Netflix.
They subscribe to Spotify.
They live in cities where they have local officials that demand you can't see a billboard from a park.
So the advertising is a tax on the poor and the technologically literate.
So it's moved to more distribution and innovation.
But for God's sakes, don't you know, avoid the falling into the trap of thinking that the masters of the universe are branders or advertisers.
Having worked in the advertising industry, this is a conversation we have all the time with clients, which is you'll meet a certain type of client who is very who is they're religious about the bottom of the funnel.
If it if I can't track it and I don't know exactly, I won't do it.
Then you'll sometimes meet the opposite, which is someone who just loves to spend on brand.
And I don't think they're wrong.
Yeah, I mean, Mark Rits, very good marketing professor, always talks about the importance of both ism.
And he says it's vitally important that when I actually speak about the importance of brand marketing, that you do not interpret this as denigrating digital marketing.
In fact, I go a bit further and say the bottom of the funnel, in many respects, is the thing you have to optimize first.
Because there's no point in actually, if there's a bottleneck at the bottom of the funnel, if there's some constraint or a problem or a failing, you know, if you have very poor conversion, OK, there's no point in spending money on advertising because you'll just introduce more people to a disappointing
experience. So you've got to get the back end.
I would argue the first thing, in theory, you should optimize if you're being an absolute purist is repeat purchase.
Because having gone through the expense to acquire these customers, actually, that's the that's the metric that always fascinates me, because we are talking earlier about electric cars.
And I said the question about electric cars isn't how many people are buying them.
OK, it's not what percentage of the new car market in the UK in July were plug in vehicles.
Now, only question worth asking really in the long term is, does anybody who buys an electric car go back to buying a gasoline car?
Because if the answer to that is hardly anybody, then OK, you don't know the exact shape of the S curve, but you know the growth is going to be pretty spectacular.
And so the thing to understand, I think, in a market is to what extent does your product actually convert someone to something?
And then the lifetime.
So you start with repeat purchase, then you go to conversion and then you'd work your way up.
But what tends to happen is that when people are obsessed with quantification of everything, OK, it's worth noting, by the way, that all big data comes from the same place, the past.
All right. So there's a limit to how much big data, particularly if you've had some major event like a pandemic in between, how much big data can actually tell you about the future in any case?
As David Ogilvy famously said, you're not advertising to a standing army.
You're advertising to a moving parade.
People are coming in and out of market all the time.
And so you're absolutely right.
You get some people who are just fame junkies.
And by the way, I suppose there are brand categories where that's appropriate.
If it's sold through retailers, you know, in other words, if it's mostly sold in the physical space, you might you know, you might argue to an extent, you know, for let's say a Burger King or a McDonald's, that's not a totally crazy position, although it is now because suddenly they've got to think
about delivery and and whether people order through the app or order through an intermediary because it has a major bearing on their business.
But but at the same time, yeah, I mean, the tragedy is this idea that this false dichotomy between brand advertising and what you might call performance or digital marketing as if you have to be in one camp or the other.
Where is the balance, though?
And how does one go about is it just intuitive?
Is it just there are figures on this?
So if you look at the work of Les Bennett, for example, and Peter Field, the ratio shifts a little bit, but generally they'll stipulate a figure around about the sixty forty mark in favor of what you might call brand mass media expenditure because they have a mutually beneficial relationship.
And the first 20 years of my life I spent in direct marketing and actually, you know, because direct marketing was unfashionable, we spent a lot of time denigrating advertising spend because they got much bigger budgets and not necessarily rightly, but they were also, you know, much more indulged than we
were because they didn't have to prove effectiveness down to the same sort of level of statistical significance.
But we came to realize pretty quickly that actually, first of all, there's nothing harder than direct marketing, a product that nobody's ever heard of.
And that every time, just to give an example, every time American Express went on television or advertised big in mass media, the response rates to direct mail would not quite double maybe, but they increased pretty significantly.
You had to work less hard.
And you had to work.
It's that wonderful phrase which comes from a book by let me get his job right.
His name right. I think it's Matt Johnson, who's just written a book called Brands that Mean Business.
And his wonderful line is having a great brand means you get to play the game of capitalism in easy mode.
Yeah. And that's what is true is fame, to some extent, brings a load of benefits which aren't necessarily sales related.
So, for example, you can cock up and your customers will be more forgiving.
You OK? Take the example of Apple.
I mean, on a couple of occasions, Apple has produced products which had fairly major flaws, which might have proved pretty fatal to lesser brands.
You know, the famous phone where if you held it in the wrong way, it didn't make phone calls, for example.
And given the reality distortion field around the Apple brand, people have passed over those incredibly rapidly.
And so there are people are less price sensitive.
That's not easy to measure, by the way, as well.
It's very easy to measure the extent to which something has an effect on sales, but the effect to which something has an effect on price elasticity and the extent to which you can command a premium because it's a great brand, because it's a great brand is harder to measure because you don't have the counterfactual.
When you sell something, the counterfactual is that you assume that you wouldn't have sold it otherwise.
But if you sell something for a high price, you can't in fact determine that without your advertising, you wouldn't have sold it for, you know, for that for that premium price.
So it's to some extent this quest for perfect measurement to to reduce marketing to a kind of Newtonian physics is a bit of a false god.
Fame. You talked about fame there.
Fame can also be applied in the topic of personal branding as well.
Obviously, social media has allowed us all now to build our personal brands.
You've got the Gary Vaynerchuk's of the world who have built, you know, you know, their companies are famous because they've they've branded a person at Ogilvy and within your sort of your marketing, what kind of shift have you seen in the desire for people to become brands themselves and how valuable do
you think that is? I think advertising always had those personal brands.
And if anything, it's slightly diminished, actually.
Campaign magazine always did a very good job of, you know, making sure there were 30 or 40 sort of famous names within the within the business that just happens in a different medium now, right?
It happens on LinkedIn.
Yes, I agree. I mean, you know, so I mean, one of the greatest things, for example, is a wonderful, wonderful guy who must be I don't want to name his age, but, you know, he's past retirement age called Dave Trotch.
You probably know, okay?
He'd be brilliant interviewee, by the way, on the show.
Fantastic. But what has been absolutely fantastic is that, you know, he's a glorious advertising mind, I mean, just an absolute ornament to the industry.
And he, through Twitter and through blogging, has had a completely new lease of life and influence to a completely new generation of people and has been hugely valuable as a teacher.
What's interesting about that, actually, is that, of course, he does that unpaid.
And one of the things that is complicated about this new world, OK, you know, the most valuable thing I often do in the course of a working week is either to give something away or to put somebody in touch with something else, neither of which, you know, that kind of barter.
Neither of those things is in any way monetizable, is it?
Well, reciprocity would say otherwise.
I know. I suppose you've just got to rely on a high degree of reciprocity in some respect.
I mean, always it always bothers me about this, which is that we're in a business advertising, which is paid by the hour, which is a terrible way to pay for ideas because the value of something has no relation to the time devoted to its inception.
And it is genuine. I mean, you know, I always joke about this.
The most valuable thing I probably did was almost accidentally my working life, which was to go to the government's behavioral insights team.
And as a sort of fanatical vapor, I'd been a longtime smoker and had been able to quit for the first time successfully by switching to vaping.
It took me a little while, but once I made the switch, I've never gone back.
And I went to the government's behavioral insights team and I said, look, these things are coming over from both Japan and the United States, their electronic cigarettes.
I think there are two things you need to be alert to in psychology, one of which is that because they actually replicate the habit of smoking, not just the nicotine, they are a major kind of what you might call a gateway drug act.
They're a major source of harm reduction.
At the very least, it may help people to quit.
At the very least, it'll help people to shift to something a much less harmful delivery device versus patches, patches and guns and things like that, which didn't replicate the behavior.
And then the second thing I said is the second thing you got to be alert to is that because of peculiar human psychology, half the people in the what you might call the health and anti -smoking lobby will be fanatical about banning electronic cigarettes.
And all credit to the behavioral insights team under a guy called David Halpim.
I think they went to the camera and government and said, favor here, can we have a light touch on vaping regulation, please?
And various parts of the EU have gone for much stricter regulation.
There were some countries which were more or less banning it.
The U .S. has banned Juul, for some reason.
Bizarre. On that point of personal branding though, do you think building a personal brand is important?
Yeah, it's very interesting.
I mean, you have a personal brand, whether you like it or not.
But that's one really important point about branding, which is that everybody, you know.
And that's, by the way, why I think marketing is so important, because it's not the brand is not the heated steering wheel of the marketing world.
You know, the optional extra that you can do without, but it's quite nice to have.
People are going to perceive you in some way, regardless of anything you do, OK?
They're going to form an impression of you.
They're going to form an impression of what you're worth, what kind of business you are.
You know, and they will use all manner of kind of inferences and heuristics to arrive at this conclusion.
And in many ways, I suppose this is why I argue that marketing isn't an optional extra.
It's an essential because the worst thing you can do is build a great product and fail to present it in a way that is convincing, appealing, attractive or which confers status on its users.
And the same applies for your personal brand.
And the same, yeah, the same applies.
You're going to have a personal brand, whether you like it or not.
So you might as well try and have a good one.
I think it probably is true to say that the personal brand requires sacrifice.
You know, that old saying that strategy is the art of sacrifice, but not totally true.
I think there are win -wins, you know.
What is the sacrifice of a personal brand?
But well, I suspect.
You don't need to suspect, you've got a personal brand.
Yeah, you have to have weaknesses as well as strengths.
Now, interestingly, for example, one of the things that will be part of my personal brand is I'm not a CEO, I'm no aspiration to be a CEO.
And I know enough about myself to know I would not be good at that job.
OK, there are certain forms of ambition and aspiration which, you know, consonant with a personal brand that I have are basically avenues that are close to me.
I'm not very good at administration.
I'm very bad at making difficult decisions.
Self -awareness is a personal brand strength.
Yeah, I suppose. Now, where I'd be useful, I'd be useful at making oblique or unusual suggestions.
I'd be useful at getting people to consider the same thing in five different ways or promoting a counterintuitive thought.
I might be useful at suggesting somebody, you know, I've got a fairly good personal roller decks, you know, before you run off and do this on your own.
Why don't you talk to this guy at this university who's been studying this for the last 15 years?
In those early years of Tinder, I remember being told the story maybe 10 years ago in San Francisco when I was working there with a guy called Michael Birch, who was the old Bebo founder.
In his little sort of incubator that I was in when I was 20, they were telling me the Tinder story of how you went to a fraternity.
For people that don't know what a fraternity is, what's a fraternity?
So I guess in the UK would be like college clubs, maybe?
Do they like members clubs or something like that?
So basically sororities and fraternities and sororities are a house of women and fraternities are a house of men.
And essentially a lot of college students, they do something called rush where they rush and they go house to house and they meet all the women or all the men and then they basically pref, they put in the name of the one they would really love to be a part of and then they see who accepted them back.
It's been criticized up and down and there's a lot of things that are not, you know, spectacular about it.
But this is a way a lot of people find friendship and community.
It's it's a community gathering for their college campus.
So with Tinder, I essentially went back to my alma mater at SMU.
I'd just graduated.
So a lot of my best friends were still in school.
So I got access to the campus and I would start at the sororities and then go to the fraternity.
So I'd essentially have all the young women download it and then run to the fraternity and then they would download it and then everyone would start connecting.
So, you know, is that good, is that bad?
How do you want to chop that up 10 years later?
Who knows? But that's the reality and can't escape the truth.
But so so you heard about this way back when I heard about this 10 years ago because we were building community centric apps.
We're building something called Blab, which resembles what Clubhouse is now.
And when we were talking about the marketing strategy, Tinder kept coming up.
And but yeah, that was the that was the thesis.
It was like, should we go to for fraternities and go get, you know, to try and build that sort of isolated tight community to try and get product market fit?
Yeah. Because network effects really, really, especially in the dating game.
But most important, that's why there's only a handful of dating apps that have ever survived.
I mean, at least during my time doing this, which is almost a decade now.
But what's interesting is there's such a not to not to say only I could do this or only somebody else could do this, but there was a superpower in the timing of it all because I had just graduated and I I knew all of these people.
So if some random startup founder knocks on a sorority door, the police are coming.
You know, like you can't you can't do that.
So I felt like I had this insider hook, right?
Because I was technically an extension of that by proxy because I had just been on the college campus.
I took the photo of one of my guy friends back then, who is, you know, all the young women had mega crush on on him.
And then I took the photo of my best friend Danielle, who was very well liked on campus.
And I went into Danny's journalism class because she was still a student.
And I basically snuck into her journalism class and used Photoshop.
And I took the Tinder screens and I put the guy's face on one and her face on the other and I said, find out who likes you on campus.
And then I saved it to a file because this is the olden days at this point.
And I went to FedEx, which is like the office supply store across the street.
And I printed a thousand copies.
And I quite literally handed different students on campus twenty dollars to go distribute them under dorm doors and to put them on windshields and to put them in their different social clubs and to essentially distribute these flyers everywhere.
So this entire campus, and now in hindsight, it's probably not great.
It's littering. There's all sorts of bad things involved with it.
But like I'm just telling you a story.
So, yeah, basically that was that was just one of the tactics I used to go and put it all over campus.
And then I had a few T -shirts printed up that said, don't ask for my number.
Find me on Tinder. And I had my girlfriends wear the T -shirts and we went to the bar.
And so I gave them a couple hundred bucks and they would go around and buy drinks.
And then when people would ask for their number, they'd essentially say, you have to download Tinder.
So it was a lot of these tiny hacking concepts that made no sense.
No one had ever done these things before.
I had no playbook. It wasn't like, you know, I was reading some manual to marketing.
It was just what felt around me.
It was it was just bringing the real life dating experience to life through through an app marketing.
There's like so many important messages of marketing there.
I mean, the first one that you said was was that you were the customer.
You were so close to the customer that you understood them.
I mean, even you said about how if another startup had come and knocked on the sorority.
Well, they wouldn't even know which door to knock on for a start.
That's true. I mean, they would have knocked on the wrong door, got the wrong people and they wouldn't have understood those people, their motivations.
So like really you being the customer, I think is such a key thing.
And then the second thing you said about like if I'd read a marketing book and you were kind of just doing it based on intuition.
I've seen over and over again from speaking to really successful CEOs and founders how important naivety was, like not knowing.
So important. Just following your gut.
Yeah, because then that's like first print.
That's creating something from first principles as opposed to convention.
That's real innovation.
Right. Like and it creates solutions that are more suited for today and for the challenge that you're solving, which no one has ever had the challenge of solving right on that date.
Right. Right. But naivety, you know, this is this is sometimes why I think some of the best founders don't come from like business school or from marketing school.
The best marketeers aren't marketing graduates because naivety is such a superpower.
It's a superpower. And following your instinct.
And if you understand what moves people and what motivates people, then you have this opportunity to connect with them on a real level.
I mean, we've done things that are ridiculous.
So I remember we would make these signs that said they had the big X's like, no, you know, like you're not allowed to.
And they said, no Facebook, no Instagram, no Snapchat, no Bumble.
This was like week three, a Bumble or something.
Some ridiculous early, maybe first year.
I can't remember at this point.
And we would post those all over the universities.
So there was this association where it was like, wait, I can't do the things I really want to do.
I want to sit in class and Snapchat.
I want to sit in class and Instagram tells Bumble.
And so we were essentially seeding this psychological curiosity.
And then we were actually sending young women wearing Bumble shirts into classes 10 or 15 minutes late, interrupting a class of 300 people and saying, oh, sorry, wrong room, but everyone's looking at this young woman and or young man, whoever it was wearing a Bumble t -shirt.
So we were seeding curiosity and this like, why is Bumble everywhere type of thing.
And so, you know, a lot of people think, oh, well, I can just go start an app and I'll just buy some, you know, Instagram ads and I'll just be successful.
But if people only knew the fraction of the insane, everyday little hacks that, you know, I did and our team did to bring this to life.
We were the first people, certainly the first tech brand to do humor accounts to pay for the humor memes.
Do you remember the humor memes?
Well, we ran out of 100 million followers on meme accounts.
Yeah. So you know all about this.
But like we were way back years and years ago.
I remember reaching out to I can't remember what it was one of these meme accounts and they're like, wait, you want to pay us to I'm confused?
How does that work?
And we're like, OK, here's the deal with a few hundred bucks or whatever it was.
We turn around a year later, that same account is charging one hundred thousand dollars a post.
So there's also something about luck and timing being.
Just right before something, you know?
And if you look at Bumble, we were also beating the woman drum, the this this drama of we need to advocate for women, beating this drama of let's put women first.
Let's let's elevate women.
Women are not equal in their relationships.
Women are not being treated respectfully.
Women are being abused on the Internet.
Women are not being treated right.
We were saying this in 2014 and then me too would come a couple of years later.
So I think we've we've been lucky as a business to basically be right before the wave.
And then we've been able to be a part of that wave versus chasing a wave.
And so many people chase a wave.
So many people chase a wave.
They look around them like, well, what's cool?
How do I chase that?
And I feel like we've always had the good fortune or whatever you want to call it.
Conviction, sure. Inspiration to go first.
And so that's been maybe a superpower of ours over the years.
