A presentation I gave recently to the Fisher Business School at Ohio State University on Emerging Behaviors across people, brands and the way we work.

1. © 2012 PROPRIETARY & CONFIDENTIAL March 9, 2012

2. EMERGING MEDIA
A Request to talk about Emerging Media sent me searching for its meaning - It seemed redundant

3. Professor W. Russel Neuman
University of Michigan
Emerging Media
Change the meaning of geographic distance
Increase the volume of communication
Increase the speed of communication
Enable interactive communication
Allow different forms of communication to merge
Neuman’s definition dates back to 1991 and my conclusion after reading it was - yep, media’s emerged

4. Professor W. Russel Neuman
University of Michigan
Emerging Media
Change the meaning of geographic distance
Increase the volume of communication
Increase the speed of communication
Enable interactive communication
Allow different forms of communication to merge
...but when I interrogated brand behavior through this lens, I was left questioning whether brands today interact well with people and whether they do a good job at merging
different forms of communication.

5. EMERGING__________
My conclusion is that they don’t and the reason they don’t is that in order to do so, brands need to understand peoples’ motivations and brand ecosystems need to function
in new ways. It’s hard to focus on these when there are so many distractions for marketers in their effort to be the most favored, shared, bought brand ...

6. ...Everything’s emerging, which makes it easy to be caught up in the shiny box syndrome.

7. A shiny box like Pinterest that’s got every brand team rushing to find their role on the site even at the expense of working out how to ensure their best visual representation
is available to pin.

8. EMERGING BEHAVIORS
So today, I want to talk to the emerging behaviors we need to understand and act upon to get the most out of the relationship between brands and people.

9. I’ll be focusing on three key areas - People: How to fast-track behavioral science to be several steps ahead of your current position. Brands: How you can break down brand
silos and find new opportunities through applying APIs. Work: How the brand ecosystem has to function in new ways to capitalize on the emergence on the mashing of
product and communications.

11. Media was a brand's tool to pull consumers along - to persuade them to buy their brand and later on to buy in to their brand. People were passive recipients of brand
messaging.

12. Today, people are leading the engagement and brands are desperately trying to keep up.

13. Adoption Lags Shortening
SOURCE: HARVARD BUSINESS REVIEW
This transformation is probably less a result of the advances in technology and more to do with the pace of these advances - brands move more slowly than people in
engaging in new ways of doing things today.

14. 2 Seconds
NOT 4 SECONDS
These numbers illustrate a shift in behavior that highlights shoppers impatience - A 2009 study by Forrester found that online shoppers expected pages to load in 2 seconds
or fewer - and at 3 seconds, a large share abandon the site. In 2006, a similar study found the average expectation for page load times were four seconds or fewer.

15. People are looking for tangibles from a brand - functional benefits, which I would call the brands as apps mentality

16. People are looking for shared values - which has been perhaps true for a long time but today the demand on action by a brand to demonstrate true belief in a value is that
much greater - look at the success of Tom's shoes - and the simplicity of the messaging - Buy one pair; we give one pair away. That took 2 seconds to explain.

17. People are looking for experiences beyond the ownership of the product - Look at Converse or Ray Ban with Mix tracks

18. R.I.P. Bad Products
And of course they are looking for all the product benefits and smart design and aspirational aesthetics of a brand like never before. There’s no place for bad products today.

19. INFORMED OBSERVED
BORROWED
So we believe brands need to be more in synch with people’s behavior in order to stay relevant and successful. I want to focus on three areas of behavioral study to consider.
The first is informed.

20. First, I need to cover off an immediate potential distraction - big data. It’s the current silver bullet but...

21. Five out of four people
have problems with
fractions
...beware those who get excited with numbers.

22. McKinsey Global Institute
140,000 - 190,000
1.5 Million
Here’s the real challenge with Big Data - According to McKinsey by 2018, the United States alone could face a shortage of 140,000 to 190,000 people with deep analytical
skills as well as 1.5 million managers and analysts with the know-how to use the analysis of big data to make effective decisions.

23. To me, the first and second data points here show the real tension in dealing with Big data.
Big Data certainly will provide answers but my suggestion is to lean against it with notions and see whether the data supports pursuing the notions.

24. It.er.a.tion
Noun
A problem-solving or computational method in which a succession of
approximations, each building on the one preceding, is used to
achieve a desired degree of accuracy.
For Big Spaceship working in digital gives us a tremendous advantage in gaining an understanding of behavior because we can launch with notions and learn from them.
The learning mechanism has to be thoughtfully built in to the product and the product has to be flexible enough to evolve over time.

25. CONSTANT
BETA
We have a culture built on Beta behavior and it’s good to capitalize on this. To look to every launch as the start of a sustainable relationship rather than a launch and leave
approach.

26. KPIs
KLIs
For us, KPIs are critical and have to be understood and agreed upon up front but we also put an equal emphasis on what we call Key Learning Indicators - behavioral
touchpoints that provide feedback on actions by users, content preference, etc, so we can constantly augment the experience.

27. Here’s an example of work we did for GE’s Healthymagination, where we introduced an App called Morsel that had a number of iterations, updating the engagement with
users via behavioral touchpoint feedback.

28. The Skittles Facebook engagement is a prime example of KLIs informing content development - most liked, most shared enabled us to focus our content and get the site over
20 million likes.

29. It’s never been
cheaper to fail
This is a statement we constantly tell our clients - don’t be in fear of failure when connecting with consumers. Just don’t put stuff out there that betrays the consumer’s
relationship to the brand.

30. INFORMED OBSERVED
BORROWED
Big Spaceship’s DNA has always been focused on behavior. Understanding the behaviors that exist, challenging what behavior we want to affect and what behaviors we can
play to. This requires us to broaden our perspective beyond digital and look at total behavior...

32. By getting out there and studying behavior beyond the screen, we are able to create rich personas and deliver engaging deep experiences that augment the relationship
between brand and person beyond a simple digital interaction.

33. INFORMED OBSERVED
BORROWED
The final approach to behavioral understanding is to look to what behaviors can be borrowed.

34. Brands can’t create
new behaviors *
* 99.9% of the time
The smartest thing for a brand marketer or advertising partner to do is to look at other categories that exist in their consumer’s life and see what behaviors they can borrow. It
can be as simple as looking at gamification and rewards with Mint.com to people’s interaction with their smartphone while waiting. While thinking about tackling a challenge,
think about behaviors you can replicate rather than forcing them to learn new behaviors. It almost never works and requires tremendous patience is essential.

35. How can we apply new behaviors to brands?

36. Stuff. Stuff. Stuff.
We live in a world of phenomenal products - Reference Louis C K’s “Everything is amazing and nobody is happy”. Great products keep being invented...

37. From the iPad to the new intelligent Nike+ Hyperdunks to Orbit Strollers that adapt with your growing family...

38. ...to apps like Mint, Strava and Plex’s digital media console...

39. ...to Lynx’s one spray emergency deodrant for guys, Tide’s all in one - no mess - washing powder to... OK, maybe lime flavored beer pushes it too far.

40. 156,125 new products
introduced by cpg companies in 2005
Only 4 percent of these products achieved annual sales of more
than $50 million.
Estimates of new product innovation failures range from 53% to 86%
SOURCE: BOOZ ALLEN HAMILTON STUDY 2005
Invention is incessant but how effective is it in maximizing the success of a business?

41. FFUTS LUFESU GNIKAM
MAKING STUFF USEFUL
Big Spaceship’s call to brands is to focus less on making more stuff and instead focusing on making the stuff that exists more useful.

42. Nike BAND EQUITY
Performance
SHOES ATHLETES TRAINING NIKE+ EQUIPMENT
Athletic Sponsorship Routines Running data Golf
Fashion Learning Health Running maps Clubs
Basketball Connections Encouragement Demographics Balls
Football ... Expertise Community data Training
Tennis ... Individual's relationship to community ...
Golf Individual competitive challenges
... Competition pulse
...
MATERIALS
Leather RECENT ADDITIONS
Rubber Basketball shoes
Synthetic Jump height
... Length of play
Intensity of play
Challenges
...
Training shoes
Training data
Levels of engagement
Duration
Length of commitment
Role of encouragement
...
Please excuse the simplicity of this example but I wanted to share our thinking on how you make what exists more useful. Imagine you are looking across the business units
at Nike and seeing a way to combine elements to create a new or enhanced engagement.

43. Applying APIs
INTERNAL HORIZONTAL
We do an audit of a brand by stripping the brand down to its individual pieces. We can then apply behavioral understanding and see if there’s an opportunity to layer an API
across silos.

44. Nike BAND EQUITY
Performance
SHOES ATHLETES TRAINING NIKE+ EQUIPMENT
Athletic Sponsorship Routines Running data Golf
Fashion Learning Health Running maps Clubs
Basketball Connections Encouragement Demographics Balls
Football ... Expertise Community data Training
Tennis ... Individual's relationship to community ...
Golf Individual competitive challenges
... Competition pulse
...
MATERIALS
Leather RECENT ADDITIONS
Rubber Basketball shoes
Synthetic Jump height
... Length of play
Intensity of play
Challenges
...
Training shoes
Training data
Levels of engagement
Duration
Length of commitment
Role of encouragement
...
So let’s look at basketball as a focal point. What do guys care about beyond the shoe? How about training routines that build body fitness? How about connections to key
players - Nike has the contacts - and share their fitness regimes? How about a way to encourage progress through some form of social layer that enables people to share
their progress on and off the court.

45. Applying APIs
INTERNAL TO EXTERNAL
...and how about going one step further and stepping outside of Nike’s own product offering and tapping in to nutrition - advising users on the best nutrition for basketball. You
could even tie this to the celebrities. A whole new engagement platform is created without actually having to invent any new product advancement.

46. Google Creative Labs
What do you love?
Here’s an example of this thinking applied to our client Google, who asked for our help with their options page. We chose a strategy of Show don’t Tell, which brought to life all
the individual products offered in the options page through a simple question that begged to be answered - What do you love?

47. This is how the Options page looked...

54. ...and in case of any profanities, we built in a way that the page would go respond with kindness by suggesting the search to be on kittens.

55. Finally, we believe none of these new behaviors can be adopted long term without a shift in the way we work as marketers and advertising partners.

56. If it’s uncomfortable,
you might be on to
something.
It should be no surprise based on what I’ve suggested with borrowed behaviors, adopting new behaviors is hard. It requires a level of discomfort that many in our business
don’t want to experience. Two typical patterns emerge. A reluctant dive in followed by the emergence of old behaviors, which eventually create frustration and an assessment
that the new behaviors don’t work. Or a slow transition to new behaviors that require patience but with a north star defined and understood, the transition eventually results in
a changed approach.

57. COMMUNICATIONS
BRAND
PRODUCTS
I want to look particularly at our industry to give an example of how behaviors have to shift. In the past, a product was developed - a tangible piece that would be wrapped in a
brand through packaging and advertising messaging. An advertising partner would be brought in to handle the communications piece. A brand used to be created by the
advertising - it shaped perceptions, made connections with a desired audience. It appeared to make sense for the separation. Today, we believe a brand is the sum of its
actions - everything it does from its inception, through to the manufacturing and finally its disposal is in one respect under scrutiny and in another, an opportunity for
engagement with consumers. So why do we have a wall existing between communications and product?

58. COMMUNICATIONS
BRAND
PRODUCTS
For us a brand's advertising partner should sit firmly between product and communications and in truth few clients see it this way. I use advertising partner loosely here as this
is not what I would say our role was with either Google or GE. For an advertising partner to succeed, it has to live with the product and be a potential contributor to the
creation of products or even the creator of products - being able to pivot between productizing a brand communication such as an app or social platform. At the same time it
has to find ways to deepen the relationship through communication as people seek more of an understanding in a brand.

59. COMMUNICATIONS
BRAND
PRODUCTS
What I would like to call the old way of doing things only because I want to ignore that this is still very much how things are done. A product is conceived, prototyped, focus
grouped, manufactured and somewhere in this space, communications are engaged to think about branding, advertising and launching the product.

60. COMMUNICATIONS
BRAND
PRODUCTS
An advertising partner is then briefed and tasked with creating a campaign against this product to try to engage potential consumers. Everything lives in isolation of each
other. Everything is based on a shallow relationship with consumers. There might be a logo or even a tag line that connects different endeavors but they live separately.
Advertising campaigns are these peaks that use sporadic nudges for engagement and the goal of that engagement is immediate sells.

61. (narrative) COMMUNICATIONS
BRAND
PRODUCTS (behavior/UX)
You have to seek out advertising partners who show a curiosity for the product and who look at consumer behavior and can find opportunities to deliver useful interactions
with that behavior.

62. (narrative) COMMUNICATIONS
BRAND
PRODUCTS (behavior/UX)
I want to share a couple of examples where we are seeing this new behavior coming to light. If we label Products as the behavior/UX of a brand and Communications as the
narrative of a brand, you can see interesting mash ups between the two putting more narrative in to the product and its development and engaging behavioral/UX through
communications.

63. (narrative) COMMUNICATIONS
BRAND
PRODUCTS (behavior/UX)
I’ve chosen two brands to focus on. The first is Mail Chimp, which I believe has done an excellent job of putting the product behavior/UX in to their narrative. Literally creating
a publishing like aesthetic and ethos around the product and even having a ton of fun with it at the same time.

69. (narrative) COMMUNICATIONS
BRAND
PRODUCTS (behavior/UX)
The second example is Warby Parker who tackled a behavioral challenge straight on in their communications with choosing 5 pairs online, receiving them and getting
feedback via Facebook from Warby Parker experts and sending back the ones that didn’t work for you. They also created an awesome social business core to their offering
and then they’ve done a great job of telling their story through their annual report - one of the best designs in annual reports out there in my opinion.

74. Cross Disciplinary Teams
Finally, to really make this all work, you need to work in new ways. At Big Spaceship, we chose to eliminate departments and instead create fully functional teams. It
eliminates inefficiencies in most operational areas. It eliminates the need for meetings. What it brings is ownership across a team. It brings immediate response to a moment
of inspiration. It creates a team conversant beyond their skill set. Ideas come from anyone and their success is through collective ownership.

75. Four Principles
Collaborate.
Produce exceptional work.
Take care of each other.
Partner with your client.
The rest is up to you.
We also don’t believe in management down where processes are institutional. Our teams are provided with these guiding principles and through working together for a period
of time, processes unique to the team start to bubble up. There’s complete autonomy and financial transparency in the teams. It’s been a powerful contributor to our shift in
engagement with clients and the clients are very much part of the teams.

76. Thanks...
PRESENTATION BY:
Alasdair lloyd-Jones, Chief Operating Officer, Big Spaceship
CONTACT:
alj@bigspaceship.com
@alasdairllj