Laurence Bernstein

Laurence Bernstein has a diverse background of unrelated skills and activities, culminating in his current focus on making companies and products grow by understanding and delivering meaningful experiences to people. In an odd way he calls this brand consulting, and he accomplishes it through the auspices of the company he founded 9 years ago, BC3. Most of the magic happens as a result of finding new ways to understand how people integrate the product in their lives, combining this with what is known about the product, the cultural and social context and the dreams and visions of the clients, and then praying that something will somehow crystallise from the ether. This is called Rainmaking: not making the rain fall, but making the conditions right so it wants to fall!

Laurence is a graduate of Cornell University and is a member of the Cornell University Trustee Council, and the Cornell Arts Committee. He has worked for major hotel brands, advertising agencies and was managing partner at RPM, one of Toronto's most innovative and successful clubs. His world view has been honed by stints living in the UK, US, Germany and, of course, being born and raised in South Africa.

"Practically speaking, I like to take the highest road in approaching any client: how do we really make a difference to the client's business. Too often clients ask for and receive solutions that make incremental changes in what the they do, how they do it and, therefore, what success looks like. I am, mostly interested in paradigm-shifting changes.

"Other than the above, I confess to being a closet computer geek and obsessive news junkie."

Red Herring Season

At the time of writing I have just left a meeting with Sandy Weill (of Citibank fame), where he told me we are entering into the deepest recession any of us has seen in many, many years. Of course, he was talking about the US. But let’s say, hypothetically, that Canada does not miss this bullet (in spite of our government’s solid, stay the course plan) and we too enter into a recession. What then?

Unemployment climbs, demand for consumer good drops, the economy shrinks, inventories shrink, profits disappear, and so on. Most importantly, though, none of this is our fault at a micro-economic level. It is all the fault of the economy; a comforting thought to many Canadian business leaders who love nothing more than to find a convenient external source to blame for whatever happens to their business (high taxes, the liberal government tax and spend policies, the free market conservative policies, the dollar, 9/11, SARS, Listeria, and so on).

Don’t blame these poor souls. They are suffering from RHD, Red Herring Disorder, a viral disease native to the Canadian Urban Regions.

RHD starts, as do all worthwhile disease, with flue like symptoms. Subsequently the patient slumps into a lumpish, self-sympathetic pose, often muttering: “But there’s nothing we can do,” over and over again. RHD victims generally cut budgets and cancel activities, mostly to avoid being responsible for anything, but also, in most cases, to reduce their workload in order to spend more time bemoaning their fate. RHD is probably caused by an airborne pathogen as it is easily transmitted from person to person (and, in an odd, metaphysical way, from organization to organization).

As RHD progresses it takes control of the autonomous nervous system, causing the patient to become increasing boring and repetitive. A compulsive need to stifle any external stimuli and repeat the “cut the budget” mantra is the reason this disease is often mistaken for an obsessive-compulsive mood disorder. Practitioners now believe this not to be the case, as RHD is often accompanied by a contradictory psycho-neurotic behavioural symptom: pathological self-preservation syndrome. The precise relationship between RHD and PSPS is not clear, but the fact that they so often occur in parallel has opened an entirely new path of study for experts in these diseases.

RHD is often incurable and, in the worst cases, ultimately results in the sufferer being separated from the organization organism at such time as the economy improves. Unfortunately for the organization organism and the world in general, this occurs far too late to be of any use.

In the US, a vaccination has been tested and shown somewhat successful. At the very first intimation of the virus, test subjects are given massive doses of courage and creativity. Early test show that the resulting hard work, positive outlook and immediate business success appear to be effective in fighting off the disease.

If not caught in time, the disease cannot be effectively treated.

Under no circumstances, should sufferers be exposed to competitors who have taken advantage of the difficult economic climate to rethink their fundamental mission and vision, and develop innovative, effective, and hard-hitting strategies.

An open question on brand asset values

What happens to brand value when the stock exchange crashes? If we accept that a the value of the brand is reflected in the price of the stock, then is the value of the brand depreciated proportionately with the value of the shares, or is the value of the brand a constant that would, effectively, moderate the depreciation in the price of the stock?

This is a conversation worth having. As a prompt (or by way of instilling a bit of reality) the following is a list of some brands that came to mind,

To make the discussion more interesting I have included some stocks showing the change in stock price between April 2 and September 30. (I chose the stocks arbitrarily and chose the April 2 date for the initial valuation arbitrarily as well).

I look forward with interest to hearing a wide variety of theories about the relationship between brand strength and stock price.

Is shifting media spend away from mass advertising really all that smart?

Is it my imagination, or am I receiving less unsolicited direct mail in my mailbox?

I suspect I am, and I suspect many others are too. And this begs the question: "Why?"

The reasons may be obvious: direct mail has become “CRM” which is almost infinitely more more targeted (and I, having passed into the post marketing age cohort -- 55plus -- am not a target); and/or marketers are supplanting the role of direct mail with on-line and so-called experiential alternatives. While I can deal with ageist rejection, it seems a pity that post modern communication strategy is designed, essentially, to ensure that the untargeted (such as I) never will find out about products and sevices.

Is there any evidence that the tighter you can target customers, the more efficiently you can build brands? In other words, is efficient targeting the nirvana of marketing? Or is this concept just another case of "conventional wisdom", which, as Robert Samuelson points out in his book “Untruth”, is almost always wrong?

Over the past fifteen years brand marketers have radically cut back on mass advertising in favour of CRM and on-line activities and social networking. This is based on the idea that if you know enough about everybody in the marketplace you can target only those who will be your customers.

At one level this may seem to make sense. It has always been the strategy of choice for high ticket items and luxury goods, while mass products used mass communication tactics. Now, with the increasing availability of low cost, highly targeted new media opportunities, even the massest of mass brands has migrated to this approach. This migration was, and is still, fueled by the magic pixie dust known as: measurability. New media vehicles offer limitless statistics that, when packaged in a binder, look like measurements of the effectiveness of the advertising; and this is what CFOs apparently are looking for (media-measurability trumps sales results every time).

The problem, as I see it, is the unknown. Targets are defined according to the characteristics of the people who we already know use and like our products. No matter how you dress it, targeted marketing can only build relationships with people who in one way or another have told us, directly or indirectly, they want to be targeted.

But, what about all the other people out there who have not told us they want a relationship, probably because they don’t know we exist (because we’ve stopped advertising to the masses.) They don't enter into the targeting calculus and, as long as we tighten out target, they never will.

That's what mass media is for, and why brands were so successful even before these new media alternatives came on line.

Social anthropologists tell us that society is changing in many ways. Generations are different and have different tastes and priorities and beliefs. That is why, we all seem to agree, people are drinking fewer fizzy drinks (colas in particular), drinking fewer beers, and buying more active wear (shoes in particular) and energy drinks.

Is it a cause or effect. In “the day” m fizzy drink advertising (of the mass variety) was ubiquitous, as was beer advertising; and we hardly ever saw a running shoe ad or energy drinks. Could the fact that this is no longer the case, have something to do with the decline in sales in these categories? Is it a fundamental shift in values that has caused the rate of smoking to nose-dive, or could it be the absolute absence of advertising?

This is a trick question – if advertising caused the smoking boom and lack of advertising caused the smoking bust, then does the same process not apply in other categories? And if it does, then why do we think withdrawing mass advertising from the marketplace is a good idea?

As you think about this, I would like to bring one more piece of information to the fore:
A third of consumers (US) say they never want to see ads (only one third!), BUT of those who do want to see advertising 25% want to see it on TV, radio or internet AND (remarkably) fully 25% want to see it in print! (Mediamark Research, Responsiveness to Ads Across Media, n=24,000, as excerpted in Advertising Age, August 11, 2008, page 22)