Freedom is Never Free

What happened to the 56 men who signed the Declaration of Independence?

I often wondered what happened to the 56 men who signed the Declaration of Independence and was sent this by a friend:

Five signers were captured by the British as traitors, and tortured before they died. Twelve had their homes ransacked and burned. Two lost their sons serving in the Revolutionary Army; another had two sons captured. Nine of the 56 fought and died from wounds or hardships of the Revolutionary War.

They signed and they pledged their lives, their fortunes, and their sacred honor. What kind of men were they?

•    Twenty-four were lawyers and jurists. Eleven were merchants, nine were farmers and large plantation owners; men of means, well educated, but they signed the Declaration of Independence knowing full well that the penalty would be death if they were captured.

•    Carter Braxton of Virginia, a wealthy planter and trader, saw his ships swept from the seas by the British Navy. He sold his home and properties to pay his debts, and died in rags.

•    Thomas McKeam was so hounded by the British that he was forced to move his family almost constantly. He served in the Congress without pay, and his family was kept in hiding. His possessions were taken from him, and poverty was his reward.

•    Vandals or soldiers looted the properties of Dillery, Hall, Clymer, Walton, Gwinnett, Heyward, Ruttledge, and Middleton.

•    At the battle of Yorktown, Thomas Nelson, Jr., noted that the British General Cornwallis had taken over the Nelson home for his headquarters. He quietly urged General George Washington to open fire. The home was destroyed, and Nelson died bankrupt.

•    Francis Lewis had his home and properties destroyed. The enemy jailed his wife, and she died within a few months.

•    John Hart was driven from his wife’s bedside as she was dying. Their 13 children fled for their lives. His fields and his gristmill were laid to waste. For more than a year he lived in forests and caves, returning home to find his wife dead and his children vanished.

Freedom is never free.

Get Your Story Straight

From toxic bank assets to tampered-with pizzas, the contract of trust
between businesses and consumers has been severely damaged. Brands that don’t embody all the elements of engaging narrative will fail to thrive.

Get Your Story Straight

Article, June 29th 2009, Adweek

In every great movie, there are five constructs that can be applied to guide narrative-based brand strategies: Setting, Hero, Villain, Mission and Success. Successful brands are stories told well, so who better to turn to
than the best storytellers: Hollywood.

Misconduct by big brand names and shifting consumer behavior has changed the perceived value exchange between brands and consumers. This has created opportunities to hold different conversations with the consumer with new approaches that enable them to better connect with the brand. To optimize this new conversation, brands need to relinquish a degree of control to the consumer by adopting narrative-based brand and marketing that can impact multiple platforms to engage consumers. That will create brands
that are more magnanimous, malleable and functional.

Setting is key. The day after “Mission Accomplished” was proclaimed in May 2003, “two brown trucks” were reported approaching the Iraq border via Turkey: It was UNICEF delivering on their “Advance Humanity” promise. Now that’s a setting of a great narrative: UNICEF is always in first.

From toxic bank assets to tampered-with pizzas, the contract of trust between business and the consumer been seriously damaged. It’s time for marketers to generate more “earned media” with the deployment of brand narratives, non-traditional media and innovation playing a central role in the new two-way relationship with consumers.

As Noel Coward famously said, “Consider the public. Never fear it nor despise it. Coax it, charm it, interest it, stimulate it, shock it now and then if you must, make it laugh, make it cry, but above all never, never,
never bore the living hell out of it.”

Heroes and anti-Heroes must be called out. The cult of CEO as a “wealth-creating warrior king” has been eviscerated, but there are a few who are heralded as titans and heroes such as Apple’s Steve Jobs, Xerox’s Ann Mulcahey and anti-heroes like Warren Buffett who operate as leaders with determination, self reliance and a degree of success that is particularly notable.

These types of heroes enable narrative brand strategies that enamor the nation and, over time, we start to trust them. We do so because they all share traits we search for in our heroes: belief, optimism, courage and
preparation. The same traits can be found with rock stars like Bono and ordinary people like the remarkable singer, Susan Boyle of Britain’s Got Talent fame, who inspired us all with the optimism that anything is
possible. All brands need a hero.

So then who¹s the bad guy? Many brands suffer from a false sense of entitlement: they assume they have permission to play and end up groveling in a self-indulged pit of frivolous utility. All successful strategies are

destined to fail, but new victory conditions can be created by the presence of a villain. Starbucks’ brand is facing a chronic debilitating decline, so through BBDO it has launched an intelligent counter campaign to tell the brand’s “story” around fair trade beans and its healthcare for employees: The villain they’re pitted against is the price driven competition who care not for either. We’ll see if its army of twitterers follow the print ads, but the approach provides Starbucks with a much needed purpose for being.

Identifying a clear mission is crucial. Take the average corporation’s mission statement and turn it on its head, it doesn’t hold water. In today’s world littered with litigation, accusation, scandal and bankruptcy, whom do you trust? Thanks to the Internet, the over-reliance that perception is reality has been vitiated. The truth should not be whatever you get others to believe, it should be about consistency between word and deed.

Brand messaging is about who you are and what you stand for. Without non-financial goals your ship is rudderless. At one end of the spectrum, Johnson & Johnson is the fifth most profitable company in the Fortune 500 due in part to its strict adherence to its highly ethical mission statement established in 1943. At the other end of the spectrum we have Product (RED) that has reinvented the business model of philanthropy whilst focusing solely on its mission to eliminate AIDS in Africa.

Einstein proclaimed, “not everything that can be counted counts and not  everything that counts can be counted.”

Hitting targets is not a marker of success. Enabling your brand to inspire authentic community; now that’s true success. With a mission to save the world from poverty, Nobel Prize winner, Muhammad
Yunus, launched Grameen Bank in Pakistan three decades ago. The bank pioneered the concept of “micro-credit.” By focusing on the idea of solidarity lending, Grameen Bank has distributed $7 Billion, helped break
the cycle of debt for over 3.5 million members and has a loan recovery rate of over 95 percent.

These uncommon businesses share a common bond; they all shaped their brands to engage and enable people to be involved by providing consumers with a reason to participate: A story.

Agency Debt and Death

Recession is a viable reason to re-examine how clients pay their agency partners, the solution is not to stop paying them!

Agency Debt & Death

Article, June 26th 2009, Agency Spy

By Dean Crutchfield

I was brought up on the notion that there were two things we could guarantee in our lives: Debt and Death. Today we’ve got agencies in debt and death of advertising smears.

In the face of this adversity the often approached and avoided “value-based” compensation system is making a successful come back via marketing heavy weights, Coca Cola and P&G; with P&G going to the extreme edge of the curve with one agency made responsible for all the other partners, including payments, budgets and hires! It’s tragically ironic that whilst recession is a viable reason to re-examine how clients pay their agency partners, the solution is not to stop paying them!

My favorite face on a currency, Mr. Benjamin Franklin, advised that a penny saved is a penny earned. And that’s exactly the advice corporate clients have adapted to assuage their cash flow by holding onto what’s rightfully yours. That, in a nutshell, is it, cash flow; theirs first, yours whenever… Facts are stubborn things so what’s the ethical thing to do? That mostly depends on who is asking, in this case the agency, who is going to be affected, the agency, and the likely outcome, a defunct agency (maybe). Payment default will always raise the question about the success of the relationship:

Armed robbers burst into Cannes, line up agency execs and clients against the wall, and begin to take their wallets, watches and invoices. An agency executive and his client are among those waiting to be robbed. The client suddenly thrusts something into the hand of the ad executive who whispers, “what’s this?” The client whispers back, “it’s the money I owe you.”

Fear of separation is often what unites us so let’s face it, we’ve been drafted into a war we didn’t create and the costs of winning a new client are 5X more than retaining an existing one. Getting, asking, begging for your money is a scary, inherently unstable, essential activity we need to undertake to survive. But how heavy do you go and is there any upside?

For the CMO, what matters is optimizing marketing’s value by leading the charge for change with new approaches, cost cuts, structure changes and added value of their agency relationships. For the CFOs cogitation, marketing’s value is that he can cut it, or simply just stop paying it. Clearly they’re utilizing both effectively.

John Maynard Keynes said, “If I owe you a pound, I have a problem; but if I owe you a million, the problem is yours.”

Perhaps debt is good for retaining clients? Just because someone stole your shoes, it doesn’t mean you have to cut off your legs. The key is to keep that relationship because debt makes for a monster switch out cost for the client if they wish to leave. As Ivan Lendl said about playing the mighty McEnroe, “I keep my emotions in my wallet.”

Wal-Mart’s Private Label ambitions

A new growth trajectory for Wal-Mart

Wal-Mart’s ambition for its private label brands is expanding. Traditionally targeting low and fixed-income customers, Wal-Mart stores are also witnessing a growing number of mid-income Americans enjoying their unique offer of value. So although their core value proposition of value and convenience has not changed, they have recognized the need to strategically tear the private label offer apart from top to bottom, treating private label as a cornerstone of their value offer and a center stage for growth.

Therefore, they’re looking for much more than a simple packaging redesign and are implementing a bold private label strategy that drives traffic, increases loyalty and grows revenues across multiple categories and SKUs – providing Wal-Mart a sustainable and un-copyable competitive advantage.

A central part of this strategy seems be a new brand architecture that identifies the winners to back (like Great Value), and retires less effective brands, and that correctly matches brand to product offerings and customer segments. Once the architecture is being put in place, its component brands (like Great Value) will all need to deliver an evolved “brand language”: a new look and feel, information architecture, and brand experience for customers. This language will need to address different segments, different needs, different products and different prices. Simultaneously, enabling Wal-Mart to reduce the SKU count and review adjacency strategies and zone planning.

Clearly Wal-Mart has a strong value proposition from a business and brand standpoint: value and convenience. Now they’re translating this into a compelling new own brand portfolio – to help create a difference in-store, a deeper emotional connection with customers, greater differentiation from their competitors, and a new growth trajectory for Wal-Mart.

Gordon Gekko’s tears

Times have changed when you read that 400 MBA Graduates from Harvard Business School proselytize to serve the greater good.

Times have changed when you read that 400 MBA Graduates from Harvard Business School proselytize to serve the greater good.

Rise of the Machines

Rise of the Machines: NO. Rise of the attack ads: YES. As Economist reports, be careful, they can (literally) ignite in your face and burn your wallet. I think I’ll start penning my letter to Domino’s.

Why Sir Martin Sorrell’s New Deal Isn’t Such a Big One

Sorrell understands that the fickle consumer is in the driver’s seat and that requires new ways of marketing. He is smart, intrepid and unleaderable and he knows that shareholder value is a result not a strategy.

Why Sir Martin Sorrell’s New Deal Isn’t Such a Big One

Article, June 4th 2009,

By Dean Crutchfield

Oscar Wilde once mused that “to know the price of everything was to know the value of nothing”. Our cogitation surrounding Sir Martin Sorrell’s $96M remuneration package is a fascinating debate about perceived value.

As an industry we bring tremendous value: brands are a businesses greatest asset promulgated by the rampant rise in the value of intangible assets. In 1982 the net tangible assets on the Balance Sheets of the companies comprising the S&P 500 accounted for nearly 90% of their value, by 2005 it was only just over 20%. So if today the value of the S&P is approximately $11.5 Trillion that means $9.2 Trillion is intangible and within that sum, WPP’s BrandZ study estimates the brand value is $2 Trillion! It is no coincidence that this all has happened whilst the marketing industry blossomed from the mid 80’s e.g. Omnicom and WPP both started 1986.

Sir Martin Sorrell had a vision to build a full-service, global-marketing company to serve worldwide clients and in 1986 he acquired an already publicly listed company called Wire & Plastic Products. Having been the CFO for Saatchi and Saatchi for a number of years, he understood that advertising was being usurped. Ad agencies needed to ameliorate the rebellion from clients who refused to keep paying ad agencies 15% commission so he moved to a fee-based model. It was also a category whose effectiveness was being diluted by technology that gave consumers more choices and tools that avoided ads. Sorrell knew the simplest answer was to act. With an appetite for acquisition he acquired fee-based service businesses such as branding, public relations, event marketing, digital, direct mail and research firms. He was also the first to really make in-roads East, adding companies and clients in Asia as well as Europe, the Middle East and South America.

I have a Financial Times article from 1997 with an interview with Sir Martin in which he talks about the challenge of getting 50,000 employees to face in the same direction. Today it would seem he has accomplished that goal with a $13.6B global powerhouse that has over 125,000 employees and 141 businesses in over 100 countries that derives more than half its income from marketing rather than advertising.

For most of us, we all want success, we all want it now and we all want it big and Sir Martin has matched all three splendidly. But is he worth it? I believe he is and I admire what he’s achieved and I have no problem with him being incentivized to keep growing WPP with $96M over 5 years if you compare that with mainstream corporate execs.

Just take a glance over the last several years and you can read stories of profligate excess, from Tyco’s Dennis Kozlowski, Computer Associates Charles Wang’s $1B share binge, New York Stock Exchange paying departing Dick Grasso $140M, Robert Nardelli getting $221M for failing at Home Depot and a tidy exit package for failure of $200M for Hank McKinnell of Pfizer.

Once again excessive executive compensation has taken center stage since the taxpayers bailout of banks that began in September 2008. We have all expressed genuine outrage as CEOs and other executives responsible for the financial crisis have pocketed millions of dollars.

Last year, the biggest CEO payouts for failure took place on Wall Street: Citigroup’s CEO Charles Prince got a bonus of $10 million, allowed him to keep $28 million worth of stock and options and granted him $1.5 million in annual perks. And at Merrill Lynch, CEO E. Stanley O’Neal walked away with a $161 million package!

He might be known as Machiavelli on Madison Avenue, but Sir Martin is not asking for a payout for failure. With him leading the way, a tsunami of consolidation has swept advertising, and now WPP and four other giants together represent 60% of all U.S. advertising dollars. Some complain that creativity in marketing and advertising has been hijacked by big business seeking world domination. I’m often concerned to hear this disappointing cynical view of ‘big business’. To be blunt, it is only businesses big and small that create the jobs and the incomes which give us all an opportunity to live better, feel better and get more out of life – and do some great work in the making.

Sorrell understands that the fickle consumer is in the driver’s seat and that requires new ways of marketing. He is smart, intrepid and unleaderable and he knows that shareholder value is a result not a strategy.

Why do I believe he should earn $96 Million over five years? First, because there’s a big question surrounding whether giant companies like WPP, Omnicom, Publicis, IPG, etc can inspire creative people and convince Wall Street that size and synergy can work. If it doesn’t we’re all in trouble. So we need a champion who is prepared to be a lightning rod figure that can charge into the fray.

Second, because the marketing industry needs big earners so that we are taken seriously as a “Business” – it provides a level of credibility. And Sir Martin accomplishes it with a determination, self-reliance and degree of success that is particularly notable.

Third, just to get some venting started and hurl some stones at the Marketing glasshouse so that the crash of glass might not be heard, but the desired effect is a series of deafening explosions amongst us.