Emerging Platforms & Disruptive Innovations

“American Typewriter” Font Cuz that’s ironic :-) Emerging Platforms & Disruptive Innovations

Brian Barthelt SVP, Director, Leo Burnett Interactive April 2015

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!Thank you to U of I college of advertising for asking me back, it’s my honor to be here today. ! Segments:

Segment 0: Housekeeping & Introductions Segment 1: Intro to Emerging Platforms Segment 2: Disruptive Innovations Segment 3: Strategies for Innovation Segment 4: Inspiration

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!Our presentation will be divided into four segments! Segment 0: Housekeeping & Introductions

(Fears, Promises, Confessions & Disclaimers)

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!First…Housekeeping and introductions! Brian Barthelt

! SVP, Director of Acquisition and Engagement

! I work for

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This is what I do for my day-job. I’m an agency guy. I help lead Leo Burnett’s stable of “Supergeeks”

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My day job is to help lead Leo Burnett Interactive. We have about 100 technologists of various ﬂavors who conceive and create digital media. Leo Burnett is one of the oldest agencies in the business. All thoughts, theories, statements, opinions, claims, etc. etc. etc. are solely the author’s, and do not reﬂect the feelings of:

My company is not responsible for anything I say. Hopefully I don’t get in trouble for anything I say. Next: Confessions

Now i want to make a few confessions… Confession:

! This presentation has 287 slides…

(So try to keep your eyes up here: they’re gonna go by real real fast)

(33.03 seconds per slide average)

I always try to warn people in advance about this presentation STYLE…its fast. Lots of slides. We have 180 minutes, minus 2 for an exercise, minus 10 for a break, and 10 for questions…leaves us with 158 minutes together. This may seem overwhelming, but they’re going to go by really really fast. Confession: I tend to procrastinate when creating presentations.

Analysis of Brian’s Progress on Keynote Presentation

(Don’t you judge me. You all do the same with your homework.)

I’m really really tired. I worked on this very late. My day job made it harder to work on this than I wanted. ! Confession:

! I didn’t major in marketing or advertising or communications.

! I am a technologist. A geek. Confession:

! At times I obsess a little too much about technology.

I’m sorry if I sound like that professor that’s WAY more enthusiastic about his class than any of the students are. I know what you’re thinking. Would would a tech geek work at an Advertising Agency? ?

(I’m well aware that it is highly unlikely that you were thinking this) Confession: I never targeted advertising.

I just woke up one day and found myself in it.

I worked in the petrochemical / manufacturing industry for 4 years. Then joined “Giant Step”: a digital solutions company. Leo Burnett owned 51% of them. Through mergers/acquisitions over the years, I found myself at Leo Burnett. Agencies usually have

Creatives Account Managers

Planners

Producers

Perhaps this is what you’ll be someday Geeks look like this, right? Historically, geeks have not been cool. They wear dockers and stained polo shirts.

I should have photoshopped some stains into these images.

They ! They havehave bad hairgreasy hair.

Trivia: that’s “Waldo” from the Van Halen “Hot for Teacher” video.

And! They have bad Questionablehair Hygiene. Not anymore. It’s now cool to be a geek.

That geek stereotype is dead. Agencies are hiring geeks in droves:

! A signal of the emergence of “MarTech”

That geek stereotype is dead. Enough confessions On to the fears

I have a few fears regarding this course Fear:

! You might be tuning me out.

! Because you’re here for one thing…

I sometimes worry the students might not be all that into this. Maybe you just want the certiﬁcate…

…and you don’t wanna hear me blah blah blah blah because you’re here for a piece of paper. I hope that’s not the case, but you never know. Fear:

! I’m supposed to keep you engaged for

! THREE HOURS

…and that’s a really really really long time. I dreaded my 3 hour classes in college. I’m going to TRY very hard to keep you engaged the entire time. Promises

BUT: I’m going to make you some promises, and hopefully those keep you engaged. Everything in this discussion is

! FOR YOU.

I promise you altruism. I tried to give you things you can use. To diferentiate yourselves, and bring more value to your employers. While I joked about doing this last minute, that might have been bending the truth a little. I put a great deal of efort into trying to give you something valuable. Promise:

! I’m going to show work to help make my points. Some of the work I demo is crafted by Leo Burnett. Some was not.

! I promise that I chose work based on RELEVANCE TO YOU: Not based on bragging about the awesome shit we get to do.

I’m not here to self promote, and despite the INTENSE pride I feel working for Leo Burnett, I’m not here to promote my agency. Some of you will be interviewing for your ﬁrst “real job” in this industry.

You don’t want to look like every other candidate.

I’m hoping to give you information that can, if used correctly, help you diferentiate yourself from other job candidates. Promise:

! I’m here to help you.

! That means afterwards as well.

! Twitter: @brianbarthelt

! Email: [email protected]

My commitment to do this speech includes a commitment to be available to you. To coach and advise you if you need it or want it. Promise:

You picked one hell of a profession

Advertising is an AWESOME ﬁeld. I’ve been outside of ADVERTISING. I like it better here. So many job options for college grads look like this.

A sea of cubicles. Death by Cubicle. My ﬁrst job looked a lot like this. Agencies are different.

! Advertising culture is addictive.

! You won’t want to work back in “the real world.”

Agency culture is addictive. Collaborative. Less rigid. Make no mistake though, we work VERY hard and long hours are common. But we’re passionate about what we do. But we play just as hard. And we play. And we play. The ﬁeld of advertising is changing dramatically.

! Advertising is currently undergoing countless

! Disruptive Innovations.

You are ENTERING advertising at a fascinating time. Everything is changing. RIGHT NOW. I know what you’re thinking. “Didn’t I see Disruptive Innovation in the subtitle of this course?” ? Yes!

You DID see Disruptive Innovation in the subtitle of this course! (and we’ll talk a lot more about that later) Quick Tip: Watch for the pencil.

I tried to signal things you might want to write down with this pencil image. Chapter 1:

Intro to Emerging Platforms

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!We’re going to start with a quick discussion to “Emerging Platforms”! To recognize an emerging platform we must ﬁrst understand traditional platforms Let’s Start With an Exercise List out all of the marketing platforms you can think of. You have two minutes.

! Go. Let’s see what you came up with.

Review…classify as emerging or not emerging. Television Out-Of-Home Print Radio Brand-Web-Site Social-Brand-Pages Cinema Web-Banner

Above the Line

In advertising, you may here the phases “above the line and below the line” Above the line: “mass”… Below the Line

Hyper-Targeted Direct-Mail Social Ads

Loyalty (CRM) Targeted-iMedia Retail-Interactive Email Wearable iBeacon/BLE Driveable

Below the line: 1 to 1. Targeted. What makes a platform “Emerging?” Platform Adoption by Marketers

More Brands

Laggards

Emerging

Late Majority

Early Majority Brands Leveraging a Platform Brands Leveraging Early Adopters

Less Innovators Brands

When Tech 2/3 years Is New Time Later

Pay close attention to the X and Y axis and their meaning. “Emerging” lives where i placed the circle. Does a platform have to be technologically advanced to be considered emerging?

NO We’ll discuss two examples

Technology Based Not Technology Based

One tech-based and one non-tech based iBeacon

! and “Bluetooth Low-Energy” (BLE)

This is a particularly game-changing innovation. Mobile range detection options

Cell Tower Range: 20 - 30 miles

Wiﬁ Range: ~100 meters per repeater

Bluetooth Range: <200 meters

Bluetooth LE Range: ~30 meters

NFC Range: <0.2 meters

Several technologies exist that detect location and distance. Bluetooth LE (iBeacon) has an optimal range for many retail/shopper experiences. iBeacon with Bluetooth Low Energy (BLE)

iBeacon has 3 distinct ranges: Immediate, Near and Far. Your branded app can look for them, and trigger EVENTS as consumers enter any range. You could put an LG branded app on every LG phone, then put beacons in retail locations that trigger notiﬁcations, content, anything you build into your app. You’d know where they are and what they are doing, and deliver the most relevant messages and features. iBeacon In Retail Implications of iBeacon/BLE

A brand can target a known consumer on their phone in retail, while they shop,

! with custom offers, custom content, valuable information, etc.

! (As long as that consumer has the branded app on their phone. ) Now the non-tech example… Unabashed Shameless Product Placement

Product placement is Old news: but UNABASHED placement like this is entirely new. Perhaps it is SO shameless that it WOULD have ofended the intelligence of viewers…but it’s not unlike a movie that’s so bad it’s actually good… EVERY judge always has a Starbucks OR Coca-Cola Beverage ON DISPLAY

We don’t even know if that’s really Starbucks cofee in the cup. Carson Daly discusses contestants while driving an orange Kia Soul

We all know Carson Daly does not drive a kia Soul. The point: expect MORE of this. So unabashed that it was made into a college drinking game… Some other emerging platforms… Pre-Roll

They know a lot about you and can TARGET efectively. They know what you like. They know what you searched for. They can also HOLD YOUR CONTENT HOSTAGE until you watch the ad!!!!!! Retail Interactive

Samsung CenterStage: People hate being pressured…let them play with something high-tech. Brands participating in Blippar can show Augmented Reality content when the phone camera is pointed the product package. Daily Local Deals

This one is self explanatory Wearable Tech

Smart watches, ﬁtness trackers, direct project glasses, gesture control wristbands, “ﬁnd my stuf” tags (tile). Expect exciting new products (and channels) in this space Drivable Tech

You’ll soon be able to market to consumers through their vehicle interfaces Why does a platform emerge? An analogy: Little Kid Soccer

These are marketers

This is consumer’s attention

The awesome thing about little kid soccer: the ball is like a magnet. The ball moves: the swarm of little kids gravitate to it. No matter where it goes. The ball is consumer attention: it moves. It moved from TVs to computers to Tablets to Phones, and it’ll continue to move: to wearable/drivable/ﬂyable and on and on. Marketers will chase that attention to INTERCEPT it with their message. Segment 2:

Disruptive Innovations

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!We could go on and on…but it’s time to move on to the topic of Disruptive Innovations! Segment 2: Disruptive Innovations

Mötley Crüe, Moore’s Law, and Meh

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…which has a subtitle: “Motley Crue, Moore’s Law and Meh”: Note that alliteration makes for a catchy title. ! ! ! We’ll analyze the technology behind hair metal We’ll analyze the technology behind hair metal We’ll analyze the technology behind super bands We’ll analyze the technology behind the demise of super bands We’ll analyze the technology behind the demise of super bands We’ll analyze the disruptive innovations behind the demise of super bands I know what you’re thinking.

“What exactly is a disruptive innovation?” ? Disruptive Innovation: noun An innovation that helps create a new market, and eventually disrupts an existing market, displacing that existing market or technology. The theory of Black Swans:

It is a black swan. “This is how it works. Swans are white. Until one day....they aren’t. Everything we thought we knew about swans is no longer true. Everything from that day forward is diferent. Black Swan Theory

A metaphor to describe an event that:

! Comes as a surprise Has a major effect Is often inappropriately rationalized after the fact with the beneﬁt of hindsight.

Black swans as described by Taleb Black Swan Theory

Interpreted:

! The current so-called experts and market leaders do not see it coming. It deﬁes the current “conventional wisdom” It later becomes the NEW conventional wisdom.

Read this book. Seriously.

Black swans in my own words. How many of you actually know what this is? VCR. Video Casette Recorder. An example of a technology killed through disruptive innovation. Then Laser Disc. HUGE discs. Almost nobody had these other than hardcore videophiles. The promise: better quality cinema at home. But they could not record. Then came this. Better picture. Digital Picture. Smaller disk. But you couldn’t record on them cost efectively. Well, not really. These guys stuck around for a while so that you could still record your shows. The Tivo was the very ﬁrst digital video recorder. Now OF COURSE every single cable and satellite provider has their own, and this is already a commodity. But for a TIME: TIVO was a black swan. A revolution. Overnight, VHS and VCRs were rendered useless. I know what you’re thinking.

“What does this have to do with Mötley Crüe?” ?

(I still don’t really know what you’re thinking) Ah yes. Motley Crue. I worried I screwed up...

When i ﬁrst wrote this PART of the speech it was for undergrad…and I forgot to consider something: the age of my audience. How many of you are familiar with Mötley Crüe?

Raise your hands (no lying).

Be honest. I won’t judge you. Much. I was harshly reminded while ﬁrst creating this section that I’m not as young as I think... Or maybe I just forgot how much younger the typical student is (relatively speaking)... The revealing conversation:

Olivia (not old): My mom said you were doing a speech?

This was a conversation with a teenager that made me realize that maybe my whole topic/title were ﬂawed. The revealing conversation:

Olivia (not old): My mom said you were doing a speech? Brian (old): Yeah, tomorrow.

This was a conversation with a teenager that made me realize that maybe my whole topic/title were ﬂawed. The revealing conversation:

Olivia (not old): My mom said you were doing a speech? Brian (old): Yeah, tomorrow. Olivia: On what?

This was a conversation with a teenager that made me realize that maybe my whole topic/title were ﬂawed. The revealing conversation:

Olivia (not old): My mom said you were doing a speech? Brian (old): Yeah, tomorrow. Olivia: On what? Brian: It’s about innovation. It’s called “Mötley Crüe, Moore’s Law, and Meh”.

This was a conversation with a teenager that made me realize that maybe my whole topic/title were ﬂawed. The revealing conversation:

Olivia (not old): My mom said you were doing a speech? Brian (old): Yeah, tomorrow. Olivia: On what? Brian: It’s about innovation. It’s called “Mötley Crüe, Moore’s Law, and Meh”. Olivia: Huh!?!?!? Who’s Molly Crews?

This was a conversation with a teenager that made me realize that maybe my whole topic/title were ﬂawed. The revealing conversation:

This was a conversation with a teenager that made me realize that maybe my whole topic/title were ﬂawed. Who is

! ?

So just in case…let’s talk about Motley Crue for a moment Motley Crue is a hair metal band. This strange species existed from roughly the mid 80’s, and ruled the music scene until the early 90’s. Hair Metal Band: noun A group of 4 to 5 substance-addicted low-to-moderately talented hard rock musicians who wear the same clothes, makeup and hairstyles as the trashy girls that worship their 4-chord cliché music.

(My original deﬁnition. Apologies to those still in hair metal bands) What makes

! Special? They arguably marked the end of an era. This music video marked the pinnacle of the arena-ﬁlling super band era: #1 on the MTV top 10 video count down for months. (MTV used to actually play music videos). Footage of Motley

Crue ﬁlling stadius in this “Home Sweet Home” video made EVERYONE want to be in a super band. Mötley Crüe was also a “Super Band” Super Band: noun A musical act with mass popularity, giving them arena-ﬁlling draw that spans multiple decades and multiple generations of fans.

(I made this up) Other Super Band Examples

All of these bands ﬁlled arenas for decades and multiple generations of fans love them. One of the Final Super Bands of the “Super Band” era...But why?

If you dream of being in a super band...it will be tougher. MC was one of the last. Not THE last, but one of them. Most ARENA ﬁlling concerts today are acts that are short lived...OR...super bands from the super-band era. The culprit:

! Moore’s Law Gordon E. Moore: cofounder of Intel. Will be true until about 2020. EXPONENTIAL growth in technology. Look at the Y axis: EXPONENTIAL. Technological capability DOUBLES every 2 years. I know what you’re thinking.

“That’s fascinating!!! But what does Moore’s Law have to do with the demise of Hair Metal bands?” ?

(…still don’t really know what you’re thinking) (For Starters) UHF: Music Video Programming

24 Hr. Music Video Channel The worldwide web / high bandwidth Shareable digitized music Peer to Peer Sharing Tools New radio distribution options

Cheap hi-ﬁdelity recording

A series of technological advancements that combined to entirely disrupt the music market. It’s time for another crabby old man moment Back when I was a kid, we didn’t HAVE all these crazy bands. We had WRCK, 96.3, “The Rock”, and we liked it! Advances in Music Distribution Technology saturated the market.

! Suddenly there’s 10x, 100x, 1000x, 10,000x as many bands on your radar. Your attention span is now diluted across all those bands. ...and 100 new bands pop up every 12.4 seconds.

(I might have made up that statistic) I know what you’re thinking.

“What does that mean for recording companies?” ? Before: Bands needed to be bankrolled

There was a barrier to entry. You needed to get signed by 1 of a few record companies. After: Record companies are irrelevant. X

There was a barrier to entry. You needed to get signed by 1 of a few record companies. Disintermediation: noun Reduction in the use of intermediaries between producers and consumers.

! For example: Bands (producers) selling music directly to their audience (consumers) online instead of through an intermediary (record company)

(I did NOT make this up) Brian’s Theory of Inevitable IrrelevanceTM “Each speciﬁc technology follows a similar lifecycle toward irrelevance. It is disruptive innovations move the tech through this lifecycle.” Brian Barthelt, just now.

Innovation Competitive Advantage