Joseph Jaffe, Admiral and Co-Founder of the HMS Beagle, a small consulting boutique agency, opens this interview with the story of how the HMS Beagle, the British ship that 200 years ago, carried Darwin to the Galapagos Islands, a voyage that inspired Darwin’s theories of evolution and the survival of species.
He then explains how the amazing pace of change in today’s business environment forces all businesses, from small startups to “large, lethargic legacy corporations,” to be in the “survival business.” Small businesses understand their vulnerability. Large institutions don’t. Joseph believes, if the government does not break up large corporations like Amazon and Google, the organizations will, ultimately, break themselves.
So, what is the fast track to survival?
Adaptability to change.
For today’s agencies, this means keeping a small, strong core of talent; creating a highly branded, scalable, expandable, cut-and-paste-able structure; and contracting with “armies of partners from mercenaries, freelancers, boutiques.” Joseph does not believe in “long contracts.” He feels effective change can result from a no longer that a three month “workshop” engagement, followed by small scale advisory interventions.
Joseph spoke at the 2019 South by Southwest conference on: “Built to Suck: The Inevitable Demise of the Corporation . . . and How to Save It?” He’s also the author of a book by the same name.
Joseph believes that corporations, by their very nature, suck and that the very things that helped large companies grow will bring them down:
- Size: The size, scalability, economies and efficiencies of scale, and cost-cutting ultimately creates a strangling overhead of politicization, dysfunctionality, siloization, risk-aversion, and conservatism. The world is speeding up. Big corporations, dragging anchor, are slowing down.
- Age: Companies that started before 1980 are less likely to last . . . the baggage of legacy is not always a good thing.
- Public Ownership: Being a public company is the kiss of death.
- Culture: The cultures in big corporations don’t reward failure and the ability to change.
Joseph foresees massive cultural disruptions as technological advances change our priorities and what we value. He predicts that the substantial shift from tangible to intangible, from commodities to services, will result in the cataclysmic collapse of the real estate market. He believes companies need to change their focus from “courting strangers (first time buyers) and prostitutes (a customer who arbitrarily switches brands) to strengthening loyalty and community with their established customers.
On his “Built to Suck” website https://builttosuck.com/bonus-content, Jeff offers a free-to-download Survival Planning Canvas, a template that underpins the HMS Beagle process.
ROB: Welcome to the Marketing Agency Leadership Podcast. I’m your host, Rob Kischuk, and I am joined today live at South by Southwest by Joseph Jaffe, Admiral and Co-Founder of the HMS Beagle, based in New York. He is also here speaking on the topic “Built to Suck: The Inevitable Demise of the Corporation … and How to Save It?” He’s also the author of a book by the same name. Welcome to the podcast, Joseph.
JOSEPH: Thank you for having me, Rob.
ROB: Great to have you here. Why don’t you tell us – even by name, the HMS Beagle invokes curiosity. Tell us about the company and where the company’s excellent.
JOSEPH: First of all, I’ll tell you about the name, and then I’ll tell you about how it came to be. The HMS Beagle was a ship that sailed 200 years ago from the UK to and around the Galapagos Islands, and it carried a very important person, a VIP by the name of Charles Darwin. It was on that voyage that he formulated most of his theories on evolution.
Now, Darwin once said, “It is not the strongest of species that survives, nor the most intelligent, but rather the one that is the most adaptable to change.” So, our point of view as an agency, as a small little consulting boutique or whatever you want to call us, is that we believe today, everyone is in the survival business, and it’s our mandate to help our clients navigate the journey to survival.
The HMS Beagle, two people, two founders – myself and Lynn Power – Lynn most recently was the CEO of a small creative shop called J. Walter Thompson. Maybe you’ve heard of it. [laughs]
ROB: Right. Mad Men-esque.
JOSEPH: Yeah. Now it’s Wunderman Thompson. But she was the CEO of JWT, and before that she was the president of Arnold New York. So, we have – because she is great – the best of the creative agency, with a bit of a rabble rouser in the form of myself.
ROB: [laughs] That’s amazing. Still, you didn’t start the company so long ago.
JOSEPH: Yeah, that’s right. We launched it last year. The model is, as I said to you earlier, everyone is in the survival business whether you are a small startup or a large, lethargic legacy corporation. The difference is startups actually have proven to be better clients, easier clients, because I think they get it.
They get the fact that they’re here today, gone tomorrow. Things are going great, Facebook issues a cease and desist, right? Things are going amazingly, an investor pulls out. Then they’re gone. In the corporate world it’s what I call “death by a thousand budget cuts,” and the “boiling frog syndrome.”
So, getting the executive, the corporate – throttling them by the neck and saying, “You’re dying. You need to change your ways. Repent!” It’s hard because it’s questionable whether they get it or not, whether they’re in denial or not, whether there’s arrogance or not, whether there’s hubris or not. But there’s also helplessness, which is, “I can’t change it. I’m just a small cog in this massive machine.” All of this is coming together and creating this perfect – is your podcast explicit?
ROB: We can edit it. We can do that.
JOSEPH: The perfect S-H-1-T storm. That will maintain your family friendly.
ROB: There you go. My kids do like to listen to the podcast in the car. They say they want to hear Daddy talking, and we put the podcast on.
JOSEPH: Well hopefully they’re okay with the other ‘S’ word, which is “suck.”
ROB: They understand that word. We don’t talk about it too much, but they understand. So, I was going to ask a little bit – you mentioned the startup, and I was contemplating, what does a typical client and a typical engagement look like for you?
JOSEPH: We’ve started with a model, and we’ll see where it leads, because of course the art of the startup, the art of change, is all about adaptability, morphing, transformation. But, right now, we have taken a point of view which is—our work product is a voyage, it’s a workshop, and that’s it. It’s a small, affordable workshop. It’s no longer than 3 months, and then the goal is to get out.
No retainers, no 1-½ year, seven figure consulting deal. We spoke to a large blue chip brand, and they spoke about about a year-and-a-half consulting engagement that they were currently doing to discover their purpose in the mid-seven figure range. I think, “You don’t have that time – you don’t have the luxury of being able to go through that – the waters are not – it’s not plain sailing. It’s absolute turbulent, volatile waters.”
So, our model is get in – and not just throw a few bombs and run for the hills, but actually create meaningful impact and change, and then be able to handle and we’ll see how that goes.
ROB: Right. It seems like that would create a lot of pressure to survive on yourself to keep generating new clients. You’re kind of like a little bird that’s always having to eat. You’re always having to find a little more food, a little more food. How do you handle that constant need for new clients?
JOSEPH: It’s a great problem to have to have too many clients, where you’re being spread too thin. Just like we were discussing before the podcast started about the School of Rock, my little hobby is frustrated Mick Jagger, or wannabe.
The franchise model is a great model. I look to and I give a hat tip to Naked. That’s my goal. That’s my spirit animal. Naked Communications. I’m happy if I follow the same story and trajectory as Naked – very highly branded, scalable, expandable, cut-and-paste-able in a way.
We’ve created process. As part of the launch of Built to Suck, but also now part of the HMS Beagle IP, is something called the Survival Planning Canvas. We’ve taken a position as well. You can download that canvas for free on BuiltToSuck.com. We didn’t want to have to charge for it. But that’s part of the process. I think the thing is, if we can replicate and scale that and expand our consulting base, that’s a good thing.
But to go back to your original point as well, we just had a large client come to us and go, “We could just do that one workshop, but we’re a pretty large company. What if we had media do it and creative do it and production do it and strategy do it, and then compare and contrast?” That is a much larger, scalable project.
Then the one thing I would say is our belief is there should be some kind of a small advisory component afterwards. We recommend, and I recommend to any company out there, that once you complete this canvas, you need to go back and redo it every 3 months.
One of the things that I say – and certainly, this is an agency podcast; you think of the account planners out there – I say that we need long-term thinking, not long-term planning. We don’t have the luxury of 5-year plans, 3-year plans, even 1-year plans. We’ve got to be literally in the moment and prepared to pivot on a dime.
ROB: Right. So, the way you might engage over a longer term with a client is almost as an accountability partner, to help them redo this planning canvas, to maybe call them when they’re lying to themselves – which we all do.
JOSEPH: We have three pillars that ultimately – we have voyages that correspond to the three pillars, but we also have an overall voyage. The Maiden Voyage would incorporate all three, but then we have what we call the Monetization, Talent, and Heresy Voyages. The three pillars are Brand Monetization, Talent Design, and Business Transformation.
I’ll just give you an example in each. What is brand monetization? It is based on a belief, a stake in the ground that says the way brands have been built over the last 20 years to date will be very different to the way they will need to be built from here on out. We are living in a world no longer dominated by communications, by traditional advertising. We all know that. But how do you really build and sustain a brand, even a global brand – or is that just a fool’s errand?
Inherent in that pillar are some of the models and frameworks that are built over the years, something we call PBEC: Product, Brand, Experience, Community. Flip the funnel. ZERO: Zealots, Entrepreneurship, Retention, and Owned Assets. And rethinking consumer journeys in the middle.
This is the one where probably the agency world and a lot of marketing clients connect with. Diversity, inclusivity, leadership, training and development, capability building, vendor selection. Even thinking about organizational structure. So, a lot of that talent component. We’re living in a world now where everybody thinks bringing agencies in-house is a good idea. It’s not. We all know it isn’t, and we’ve all been proven right for many reasons.
Then you get into the final pillar, and that’s for me the one I love the most, which is this idea of change the business you’re in. Are you prepared to put yourself out of business? Really thinking of how to think and act like a venture capitalist. How to reverse-engineer this. There’s so much.
I guess my point is when you look at what we call our survival stack, there are many little crumbs where a client can come to us and say, “Can you do that for us?” – and guess what? That’s not going to be a voyage anymore. There’s no bait and switch, but we are cognizant of the fact that at some point the “we need this built for us” is either going to be us at the helm, to use the nautical analogy, or it’s going to be us as advisors and helping them find a partner and working with that partner as a middleman. Or we just hand off to our partners.
We are very big believers – this cooperative model now, this collaborative model that we’re living in, it’s the only thing that’s going to help the agency business survive and thrive, which is a small, strong core, and then just an army of partners from mercenaries, freelancers, boutiques, etc.
ROB: That brings me to an interesting operational question. How do you think an agency should think about the mix of people they have in-house and on salary versus people who are “mercenaries,” as you say?
JOSEPH: I think the actual concept of a salary is an outdated concept. One of the things I actually write about in Built to Suck is ban the employee. The word “employee” should be banned.
The concept of thinking of our talent pool as employees, punching in, punching out – I don’t care whether you’re blue collar or white collar, it’s just outdated because it doesn’t tap into the creative mind, the potential of your talent – who, let’s face it, know your business and your brand better than the agency, better than the big fat cats in the boardroom, the salt-and-pepper-haired executives, etc.
So, what is a salary? A salary is safety. It’s security. There’s no safety and security anymore. There’s no concept of being a lifer. First of all, millennials don’t want to be lifers. They don’t care for gold Rolexes. But at the same time, agencies have become bloodthirsty, ruthless SOBs, and there’s no security anymore. There’s no loyalty anymore.
Just think about this. The fact is, an agency wins Walmart and they hire like there’s no tomorrow. They lose Walmart and you’re fired. I don’t like that approach.
So, what’s the answer? Listen, I didn’t say I’d figured it out. But I think quite frankly it begins with compensation. I’ve always believed that the model should be the agency covers its costs. That’s it. No profit. The profit should come from performance, and it should come in the form of equity and it should come in the form of royalties.
I use this example even probably in my very first book, which I wrote in 2004, Life After the 30-Second Spot: the agency that created the M&Ms characters should be getting royalties and residuals until the end of time. Until we change that, we’re going to continue to have a really struggling business model.
ROB: I know you mentioned that you may not have everything figured out; how have you started to think through some of the potentially legal costs and structuring challenges of what you’re talking about, both on the long-term what you created in a campaign as well as equity in a services business, all those sorts of things?
JOSEPH: I’m going to give you an answer with a complete non-sequitur or tangent, but it will be kind of an answer. I want to go back and talk a little bit about history for a second.
When you look at the agency – first of all, I wish I’d been alive during the Don Draper days. I think advertising was really cool then. We won’t get into the Me Too shenanigans, but I just love the idea of coming to work dressed in a three-piece suit and looking real slick and acting slick and just saying, “We have the best job in the world and we are the coolest people in the room.” Today, I have a problem with people coming to work in the agency business wearing jeans and t-shirts, because I just think, this is a creative business. You should dress to impress, for God’s sake. Anyway.
So, you look at the agency business and you think about, what innovation has there been in the actual structure of an agency? There was traffic, there was print production, there was finance, there was client service account planning, the British invasion, and then after that the unbundling of media – which by the way, was probably proven, or probably will be proven, to be a mistake, I believe.
Then what? What has come after? I guess the next big trend has been the Wunderman JWTs or the VMLY&R or whatever. What we’re actually seeing is the death of the creative agency being taken over and rolled up into the digital specialist.
What I’m saying is, but we haven’t actually seen – we should add the digital department. We should add the analysts. We should add the fact that we have brought in some new skillsets. But why is there not a venture on? Why are we not seeing new roles? And I’ve got to say this, for what it’s worth: we see the Deloittes and the KPMGs and the Accentures of the world buying small creative agencies or big agencies. Why are we not seeing the creative agencies buying Deloitte-like companies and incorporating business strategies?
I guess my point is I haven’t thought it through because I don’t think anyone has, but I know that for the agency to survive and thrive, the agency must evolve and change, and that means organizationally and structurally – new departments, new roles, new skillsets, new compensation schemes.
The one thing that I’ve thought about is compensation. We’ve seen the Coca-Colas of the world do value-based or deliverable-based. We need performance-based, no doubt. I love the idea of royalty, residual, and performance-based and equity-based. We bring all that into it, then you start to see real ownership and a stake in the game.
ROB: It’s an interesting point you make too, that actually agencies who are supposed to be creative are perhaps more often than others the victim of creative destruction. They require a new generation of new agencies to come up so they can buy them into their ownership group so they can onboard some new capability they maybe could’ve figured out.
To your point on some of these mergers, I think some of these agencies have almost gotten to the point where, yes, you are a big agency holding company and you have 50 brands in your portfolio, but nobody can tell the difference between them. They all look the same. So, then you consolidate them because they all look the same. Nobody knew why they would choose one over the other.
JOSEPH: Right. That’s why I said I’m following the Naked model. At some point I’d love to expand in multiple cities and get bought. So, I’m basically admitting it, because that’s the circle of strife. It’s what happens.
I was doing a podcast the other day – I think yesterday. I don’t even know what day it is at South by Southwest. We’re talking about Dollar Shave Club, and we’re like, is that evidence that what I call the “entrepreneurial revolution,” the 5th Industrial Revolution, is not working? I said, no. It’s just the way it works. Amazon – let’s see how big we get before we suck. Guess where that quote comes from? The original quote. “Let’s see how big we get before we get bad or go bad or before we suck.” It’s Jay Chiat.
The reality is it’s inevitable. That’s why when people ask me, “Wait a second, what about Google? What about Facebook? What about Amazon?” I say Facebook sucks already, and Amazon – with Jeff Bezos saying to all of his staff, “One day we will fail. One day we will go bankrupt, and your job is to delay that for as long as possible.” This is just the way it is.
But – and there’s a huge but – what we’re all witnessing, though, is a full-on demise. 51% of the Fortune 500 companies have had declining revenues over the past 3 years. I have about eight or nine different data points. What I wanted to do in this book was really create the empirical data to support the anecdotal – the Payless, the Sears, the Toys R’ Us, the Blockbusters of the world.
Let me tell you – Yogi Berra said, “If you come to a fork in the road, take it.” Jaffe says, “If the writing’s on the wall, read it.” What it’s saying to us is there’s still going to be some winners, but the winner’s circle is shrinking just like the mass reach opportunities, i.e. or a.k.a. the Super Bowl.
ROB: What are the factors that are more likely to kill you?
JOSEPH: The four horsemen of the Corporate Apocalypse, as I call it. [laughs] The first is size. What about size? Well, the main hypothesis of the book is that the business model of big business is broken.
What I mean by that is that the very thing that helped these companies grow and was part of their growth and sustained their growth, which was size, scale, economies of scale, efficiencies of scale, cost-cutting – all of that now is strangling it because of overhead, because they’ve become too political, too dysfunctional, too siloed, too risk-averse, too conservative, etc. They’re slowing down when the world is speeding up.
The second is age. My cutoff is a millennial company – as I say in the book, I’m not an ageist except when it comes to inanimate objects like the corporation. A company born after 1980 has a stay of execution. But again, there’s an inevitability.
The third is being a public company. We’ve all heard of sexually transmitted diseases. This is a corporate transmitted disease, a CTD. It’s called short-termitis. It gives people like Elon Musk a little bit of a nervous breakdown, and he loses market cap by tweeting ridiculous things like taking the company private again. Being a public company is the kiss of death.
The fourth is culture. We can all relate to culture. We don’t have a culture in the corporate world that understands/embraces failure and the ability to change. That’s why I didn’t call the book Built to Fail, because failure is too good for corporations. Failure is too precious. Failure is too beautiful. That’s what the startups get and it’s what the corporations unfortunately – we don’t reward failure. We should.
ROB: Of the things you mentioned, in particular size and age seem like hard things to fix. Maybe that’s part of why it’s a question. How do you fix size so that it’s not going to kill you?
JOSEPH: You kind of don’t. You have to break it up. I was having a little debate today. Elizabeth Warren was sitting in front of me, and someone was saying to me – because I tweeted it or I Instagrammed it – “She wants to break up Google and Amazon.” I’m like, “Okay. And if she doesn’t, they’ll break themselves up.” If a government doesn’t come for you, your ineptitude will probably do you in.
But I think the point is that, ultimately, no one has figured out what happens when you become too big. Look at the Salesforces of the world. Eventually you saw and saw and saw until those wings reach the sun, and the wax melts and Icarus falls to his death. I think that’s just the reality.
In the book, I coined a term for a trillion dollar company. I have two. We know what a billion dollar company is called; it’s called a unicorn. So, I had two. One was a hydra, because the hydra – a lot of death and destruction. But I came up with a phoenix. I liked the idea of a phoenix. As I researched more and more about the mythology associated with a phoenix, there’s actually really only one phoenix. They do die, or it dies. There’s only one.
It’s funny because at the time there were two phoenixes, Apple and Amazon. Well, Apple has fallen out. So, it just shows you – it’s like the Highlander of corporations. There can be only one. I guess if you’re Amazon, maybe, just maybe you figured it out. But for everyone else, how many companies out here, how many banks, how many car companies, how many CPGs, how many beverage companies can be as big and ubiquitous and pervasive as Amazon?
I’ve done a lot of thinking about Amazon. Amazon does what I call diagonal integration. They did vertical integration. Hardware, software, services, support, and financing. They did the Kindle. They did Whisper Sync. They did AWS. They did all of that.
But Amazon Prime allowed them to go into different businesses – businesses that they had no business being in. Through the seamless serve-their-customer-obsessed delivery mechanism, there is no business that Amazon, I don’t think, can get into and not be excellent in. And that is scary as hell for everybody else.
ROB: There was an investor – I believe it was a guy, Austen Allred, who’s an investor and entrepreneur, who has a stated belief that one day there will be – and he believes soon – a billion dollar company that is one person. It’s a developer. What do you think of this?
JOSEPH: Isn’t her name Kylie Jenner? Is it Kylie who just became a billionaire?
ROB: I think so. Or does she outsource everything? Does she do fulfillment? I don’t know the intricacies of the business.
JOSEPH: She is kind of a one-person – so the theory is billion dollar – so where does that market cap come from? One employee, you said.
ROB: No employees, one owner.
JOSEPH: Yeah, because look, are we talking about code, are we talking about IPs, are we talking about patents? Are we talking about a monetizable open source, in a sense? It’s open source for companies under a certain size, but the corporates pay? Maybe.
ROB: Yeah. It could be that you’re able to build something like an Uber, but with one person, and you don’t have employees. You have people who contract work for you.
JOSEPH: The essence, as I understand it, is really about what the new power brokers are. It’s more about recognizing this ridiculously substantial shift from tangible to intangible, from durable to nondurable. The example – and it’s actually I think an interesting one – is IBM. IBM went from big blue to big data. They went from mainframes to Watson, to AI.
So, when you are dealing in bits and bytes and ether and ephemeral coding, absolutely that model is completely scalable. You don’t need all of this overhead to support that. That’s why unfortunately all of retail is on a fast track out of town, or to its demise.
I think I wrote about this as well. There’s going to be a massive correction and even the bottom falling out of the real estate business, because the real estate business underpins so many direct and indirect and related industries. When you’ve got self-driving cars and you don’t need a parking lot, when the shopping malls all fail because all the retail – just think about all these people that have made their money in real estate and that component, and how many small businesses or even companies have had to move or close down because rents are exorbitant?
Rents are going to become cheap. Rents in fact may become even free, and that’s how we might see a little bit of a retail renaissance. But that implies that ultimately an entire industry, which is real estate – not retail – will go out of business.
ROB: That’s a strong take, and I think it’s really interesting.
JOSEPH: That’s a crazy thought. I don’t even know what the hell – what are these gummies that I just had earlier? Wait a second.
ROB: [laughs] I saw a truck that was advertising such gummies.
JOSEPH: What is THC – no. [laughs] We’re just kidding. This is a theatre of the mind.
ROB: Even on the real estate side, you can almost imagine – even on the residential side, what does it mean when people don’t own cars and everybody with a garage just got a free extra room on their house? That even changes the residential real estate market.
ROB: People are going to use that room for something else. Do they need a driveway? What does it mean?
JOSEPH: Totally. I’m glad you brought it up. First of all, culturally, young millennials, Gen Zers, many of them – not many of them, but we’re seeing data that they don’t want to get a driver’s license. They don’t get it. They don’t feel they need to have a car because of Uber, because of ride-sharing, because of drinking and driving. It’s a different also collective consciousness applying. It’s a cultural collective consciousness.
But let’s just look at the idea of self-driving cars. Eventually what happens is it becomes regulated or penalized and taxed to the point of if you want – it’s like a stick shift versus automatic. If you choose to drive a car yourself, your insurance is so sky high that it’s just going to be for the elite, for the very rich.
ROB: Like riding horses.
JOSEPH: Yeah, exactly, through Broadway. It’s going to become a wealthtech in and of itself. But now just think about, again, entire industries. Think about the insurance industry when everything is a self-driving car in the same grid, on the same map, in the same database. Think about what the implications are for finance or financial services, etc.
It’s just fascinating when you just take the idea of a self-driving car, autonomous vehicles, and ultimately – and here’s the thing. This is an agency podcast, but look at car ads. “Professional driver, closed course. Do not attempt at home.” But first of all, you look at a car – the worst advertising of all is car advertising right now, because it’s not realistic. It doesn’t make sense.
But eventually, when cars are self-driving, how the hell are you going to sell a Mercedes versus a BMW versus an Audi? You talk about a commoditization – we’re seeing commoditization of entire industries right now. It’s scary. It blows my mind. I just think, what’s the answer? I don’t know what the answer is. I just see it happening
This is the point that I make. We’re witnessing history. I always end my presentation with – they say there are three types of people: those who make things happen, those who watch things happening, and those who turn around and say, “What happened?” We are watching it happen right now, most of us.
What side of history do you want to be on? There are going to be the winners and there are going to be the losers. There are going to be few winners and there are going to be a lot of losers, and that is scary as hell. But you know what? It is what it is. Don’t shoot the messenger.
ROB: Sure. The car side, it’s interesting to think about – it’s almost the commoditization of desire. This is not an object of desire anymore. It is an object of function you don’t even own. How much more would you pay? Uber does this. Uber has Uber Black. You can pay for that. But at that point there’s only three types of car in the world, according to Uber. There’s X and XL and Black, and not 10 models and 55 options and this desire-driven marketing.
Are there other products you see that are in the line of sight to have the desire taken out of them?
JOSEPH: Actually, I think that was brilliant what you just said, and I completely agree with it. I’ll go back to the idea of Product, Brand, Experience, Community. I believe short-term, we have tremendous opportunity to develop the experiential and communal sides of engagement and building a business.
I’ll give you a very quick example. Nike. ‘P’ of Product – functional benefit, what it does, how it works. Pair of shoes. Well-engineered, bubbles, pronation, whatever. ‘B’ of Brand – obvious. Just Do It. It’s like, “Hey fatso, get off the couch and do it. You can run the New York marathon in a pair of Just Do Its.” Emotional. A promise. A challenge.
Most brands stop there. The brand becomes an end unto itself. Both the ‘P’ and the ‘B’ are corporate-centric. “It’s all about us. We made these, now we’re going to sell them.” Now, the ‘E’ of Experience is just the ‘B’ of Brand reversed. So now it’s not just the light emanates from the tower that says, “Just Do It.” It’s how the brand can actually fit into your life and make your life better.
For runners out there, running is incredibly lonely and it is painful and it is scary. So, what has Nike done? Nike has created Nike Puls and Nike Running and Nike ID and the Fuel Band and real-time cheers in your ears when you’re running. What they’ve done is they’ve created a very strong experiential component to actually move beyond a transactional consumption.
Then finally, the ‘C’ of Communal, I define it as just-connect-the-dots-now. Now it’s not individual, solitary, lonely. It’s us. It’s Run London. It’s the human race. It’s employees of Nike Town who are runners themselves, who actually say, “Hey, come running with us.” It takes it to the next level when you actually realize we’re all in this together.
I remember through my Nike running app, on the anniversary of the Boston bombing, that weekend they basically said, “If you run on this day and you log it with #bostonstrong, we will donate $1 for every mile completed to the survivors and the victims of the Boston bombing.” You can’t create that kind of activation and engagement platform if you’re just communicating, if you’re just thinking traditionally.
I think experiential and communal, that is how you resist the urge to be commoditized. Because when everybody looks and acts and thinks the same, you’ve got to elevate. How do you elevate? I even talk about this in Built to Suck – by what I call priceless experiences. Loyalty.
That’s why retention, now more than ever, is so important. We have got to, got to, got to get out of this fixation of being – I call it courting strangers and prostitutes. A stranger is a first-time buyer. A prostitute is a switcher, promiscuous customer. We are still way too acquisition-obsessed. We need to be customer-obsessed. I believe by doing what I just told you, that’s how we will extend the life and also evolve what it is to be a brand and how to grow a brand and sustain a brand.
Sorry, that sounded like a rant, almost. But I feel very inspired talking to you.
ROB: That was a very good summation of what we’ve been talking about. If we look at the book, if we look at the HMS Beagle, what is coming up next that you’re excited about for either or both of those?
JOSEPH: Next is now. I have four questions that I’m often asked, and in my presentation here at South by Southwest I’ll address them all. This podcast won’t be out before then, so I’ll tell you what they are and I’ll give you the answers.
The first is “What’s the next big thing?” My answer is, there is no next big thing, you moron. The next big thing is now. I’ll answer your question afterwards.
The second question is “Who’s doing it right?” My answer is no one is. All the people you think are just have great PR departments.
The third is “How do we sell this to senior management?” The answer is you don’t – or you do, but you have to sell top-down, bottom-up, inside-out, and outside-in.
The fourth is, “How do we get started?” My answer is always, you have to live and breathe and feel the technology, the change. You cannot read about it in a book, even mine. You’ve got to download it, you’ve got to install it, you’ve got to get your hands dirty.
For us, for the HMS Beagle – the book isn’t even out yet. I’m in survival mode. We’re all in survival mode. HMS Beagle is in survival mode. So for me, it’s about being able to really create – if you ask me, my wish is – Lynn and I are building survival planning. Naked built out comms planning. This is survival planning. Instead of the marketing muscle, we’ve developed the survival instinct.
So, for us it’s just head down, develop the IP, develop the process, develop the workshops, and also be generous. Don’t hoard it. Be transparent, be public. Share. Survival cannot be hoarded, because if we’re all in the survival business, anybody that tries to monopolize that is a marauder, is a pirate, and they deserve to walk the plank, which is a heresy.
ROB: Right off the HMS Beagle.
JOSEPH: Right. I love the nautical references.
ROB: That’s fantastic. Thank you so much, Joseph. This has been a very interesting and wide-ranging conversation. I appreciate all the expertise that you bring to the table and what you’ve shared from your presentation, from your book, and from your life.
JOSEPH: You’re welcome. It’s funny because there was an overview of the format and the questions, and we literally didn’t address any of them. We threw it out and we just had a real, amazing conversation that went in a whole bunch of really interesting, intriguing directions.
I want to say that I’m an agency guy. I believe in the agency, but not the agency as it exists today and structure. One thing about my own little personal journey is I got really angry when people called Crayon or Evolution “agencies” (my previous two companies).
Now what I realize is I embrace being called an agency. What I don’t embrace is being called an ad agency or an advertising agency. I think unfortunately, advertising, its day has come and gone. But “agency” I think is a fantastic, amazing, powerful idea.
What I’ve actually even learned, for the HMS Beagle, our longevity and our life depends on agencies. We need agencies to bring us in to their clients, because as we all know, it’s really hard for a small boutique and startup to get an MSA and procurement and become vendor compliant. So instead of that – I say to all agencies out there, give us a call and let’s figure out how we can join forces and help your clients.
Ultimately, we’re all in the survival business nowadays. The finger is pointed at the corporations, at all of our clients. If they die and if they fail, we all die with it. We’re little barnacles on the backsides of those whales, and we need to make sure that those whales continue to survive and do not get beached. Sorry about another nautical reference, but it’s true.
ROB: We are certainly happy to make those connections between agencies, so if you’re listening, if you hear what Joseph’s talking about and you want to work with him, reach out. We do benefit when we work together at what we’re all great at.
JOSEPH: I always think, by the way, Rob, that at the end of a podcast if people are still listening, that’s when you need the – if you’re going to make a plug, make it at the end, right? These are loyal people at the end. So I’m going to say something, which is – this is presented by Converge, right?
ROB: It is. We do that plug after this, even. We tack it onto the end. [laughs]
JOSEPH: Let’s do a little experiment. If we have more beers and more of those weird gummies, I don’t know – I’m kidding about the gummies.
If you email me, firstname.lastname@example.org, and you use the code “CONVERGE” – we’re just literally making this up now – I will – I don’t know what I’ll do. I’ll either send you a book on the house or we’ll set up a little 15-minute or 30-minute session and we’ll just brainstorm. I don’t know, we’ll do something cool.
ROB: That’s a generous offer and a good plug. That’s great. Everybody go do it. Thanks so much.
JOSEPH: You’re welcome.
ROB: Have a good one.
Thank you for listening. The Marketing Agency Leadership Podcast is presented by Converge. Converge helps digital marketing agencies and brands automate their reporting so they can be more profitable, accurate, and responsive. To learn more about how Converge can automate your marketing reporting, email email@example.com, or visit us on the web at convergehq.com.