SUBU THINKS ...

REVOLUTION

It’s circa 2012. The world has changed, again. Along with the Recession, the Arab Spring and the iPad, there is another revolution under way.

An entire generation of empowered audiences is muscling its way into the hallowed chambers of marketing. They are a generation born into smart phones and tablets, a generation that instinctively believes in the two-way social conversation, and most importantly, an increasingly digitally distracted and time poor audience.

The reaction to this revolution from the marketing and communications community has been on two diametrically opposing lines. One continues to insist on the primacy of the mass-media led creative idea. The second abdicates all responsibility and talks about ‘crowd-sourced’ creativity. Needless to say, there is an increasing realization that both these extreme perspectives are flawed.

CONTAGION

We, at Ogilvy, know that infectious content needs a contagion of a brilliant idea. We understand that these are not opposing forces but, in fact, they complement each other. Indeed, to us, the most effective communication strategies now embrace the chaos between function and form. It strikes us that the best ideas now have an unstructured shape that enjoys the freedom to evolve and change as they connect and collaborate with consumers.

We are curious about deciphering which ideas have the capability to be adopted and broadcast by consumers. This is why we are investing our creative energies behind the understanding and designing of the idea contagion.

DISCOVERY

We have had a couple of big and ‘retrospectively self-evident’ discoveries on this journey.

Firstly, as well articulated by Katja Bressette in ‘Deeply understanding the mind to unmask the inner human’, we are not dealing with the homo economicus - the rational human being who makes decisions purely based on reason, but with the “homo emoticus” – the emotional human being.

Secondly, the brain expends only 2 percent of its energy on conscious activity, with the rest devoted largely to unconscious processing. Thus, traditional market research methods — like consumer surveys and focus groups — are inherently found lacking in sifting the brilliant creative ideas from the average ones, because the participants can never articulate the unconscious impressions that whet their appetites for certain products.

These two discoveries imply that we have to fundamentally re-think our creative process. For really contagious ideas, we need to engage with the emotional subconscious in our consumers. And we need to find new ways of collaborating with consumers to understand what they really want.

BREAKTHROUGH

Introducing Neuroscience. It is more than just a new-fangled research methodology. It gives us the ability to directly talk to the brain, the seat of all our emotional impulses, to decipher how consumers feel. Crucially, neuroscience allows us to unearth powerful insights into people's thoughts and feelings, insights that marketers can then use to develop accurate communication strategies that resonate within our consumers' minds.

Neuroscience^* has the capability to define the future of marketing - it is unlocking the power of emotions and changing the way we listen, converse, persuade, engage and sell.

For starters, instead of searching for the next product feature or selling point, we seek to understand the emotional spaces evoked by the product in consumers’ subconscious. By using neuroscience techniques like fMRI^* or Implicit Associations^*, we can unearth the fundamental motivations addressed by the category, product or brand.

An illustration of this – diet foods are not really about slimming down, but about insecurity. Such insights help create ideas that target these primal motivations rather than superficial features. Needless to say, such ideas also have a head start on consumer broadcast.

Secondly, we use neuroscience techniques to sift out our best creative ideas. Neuroscience techniques like EEG^* help us get a quick and direct evaluation of the subconscious impact of our most audacious ideas.

This is a radically improved method over conventional focus groups. When asked outright in surveys and groups, consumers will provide answers, of course, but those answers may be incomplete at best and quite misleading at worst.

As David Ogilvy said “The trouble with market research is that consumers don’t think how they feel, they don’t say what they think, and they don’t do what they say” Much to our relief today, neuroscience helps us directly understand how consumers feel rather than go through the say-think-feel enigma.

Last, but not the least, we can use Neuroscience methods to refine and fine-tune our final creative product. Eye tracking^* methods help understand the specific frames, within the creative product, that are driving or detracting consumer attention. Armed with such knowledge, creative directors can optimize their creative product for maximum impact.

FUTURE, UNLOCKED

The revolution will force a new dawn upon all of us. We see neuroscience as an integral part of this promising future.

In the not-too-distant future, the creative director will co-create a contagion of an idea. This will be an idea created in collaboration with the subconscious of the consumer, something that naturally has the potency to be virally shared between consumers.

Inception is here. Can you afford to ignore it?

The contracting niche of luxury marketing

Something rather expected is happening in Hong Kong. The culture of new affluence is pushing the traditionally rich into a corner.

Many luxury studies across the Asia Pacific tell us that the ‘premium’ consumer continues to look for more of what originally drove luxury brands – exclusivity, rarity, uncompromising attention to detail, appeal to a personal aesthetic and an emotional fulfillment. And the combination of all these factors results in consumer value (obviously, at a much higher price point).

However, this is different from the newly affluent consumers who want to signal that they have arrived. No wonder, they yearn for a conspicuous and loud label. It is crucial to remember that these mass prestige consumers also demand that luxury brands like Louis Vuitton continue to be a source of envy to the millions who cannot afford them.

It is indeed paradoxical that these newly affluent consumers, in the luxury brands they consume, seek brand conformity and acceptance by the traditionally rich consumers. While the very same traditionally rich consumers are moving on to a more rarefied and exclusive set of products and brands.

How are luxury brands reacting to resolve this contradiction?

The ‘dyed-in-the-wool’ family held, heritage luxury brand just thumbs its nose in disdain at this noise.

For the more pragmatic (market listed?), a variant becomes an inevitable strategy. This helps the manager retain the exclusivity to attract the uber-premium consumer. While, at the same time, the variant helps the manager make the brand slightly more accessible to the mass prestige consumer. A good example of this is the relationship between Armani and Armani Exchange (AIX). The use of discounts and sales only on the mass prestige variant is a further fine-tuning of this strategy. When following a variant strategy, most brands manage careful segregation of retail and design spaces with only some hints of the relationship between the variants.

Either way, maintaining brand equity of the true luxury brand in the face of these advancing hordes of newly affluent mass premium consumers has spawned a whole new set of strategies.

Limiting the supply and using price as an indicator are some evergreen marketing tactics for niche luxury products.

Some new tactics include increased usage of corporate social responsibility (CSR) and ecology initiatives to appeal to the affluent conscience. The auction of a vintage 1958 Jaeger-LeCoultre Model E168 watch to benefit the UNESCO World Heritage Centre is an example of such CSR.

Crucially, the luxury brand lives in the store. (No surprise then, that demand for truly premium retail locations is sky-rocketing). Take a look at the Nespresso Boutiques – and how it welcomes coffee lovers into the espresso world. And this is why luxury marketers are increasing investments to convert retail into tasteful “experience zones” where the brand can be experienced at its very best.

Lastly, in the hyper-competitive world of luxury brands, front line staff may well become (if not so already) the most crucial reason for consumers to keep coming back to the brand. As in private banking, expect personal relationship managers at the store. These people customize your store experience, or indeed, bring the store to your home.

In sum, expect luxury to become even more niche, private and discreet while its louder mass premium cousin mops up volumes from the newly affluent. Who is here by invitation? Any body?

SUBU THINKS ...

The official version: We collaborate or else.

Collaborate or else: The future of creativity in a consumer broadcast world.

The contracting niche of luxury marketing

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