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[Music] this podcast is brought to you by knowledge at Warton please visit knowledge. won. up.edu for more
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information Kevin Roberts has been CEO worldwide of Sachi and sa since 1997 and in the space of 11 years has cemented
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the ad agency's reputation as one of the most successful and creative companies
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in the industry among Sachi and sa's clients are Proctor and Gamble General Mills nartis Toyota JC Penney and the
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New York State Department of Economic Development Roberts who travels the world for a new york-based company is
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perhaps most well known for an idea he came up with called love marks which means creating a brand for which the
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consumer has quote loyalty Beyond Reason end quote before joining Sachi and Sai Roberts worked for Mary Quant Cosmetics
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Gillette Proctor and Gamble and pepsicola Kevin thanks for joining us can you tell us tell us a little bit
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more about your love Mark idea and why it's been such a hit I it started about eight nine years
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ago when I was growing very concerned that mass marketing and commodification was going to put companies like mine out
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of business I thought Brands were getting strangled by assistant brand managers and by promotion budgets and by
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retailers so I started to think about what was the future Beyond brands um and I had a conversation with a guy
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called Alan Weber who at the time was the editor of Fast Company when the Fast Company was very hot and Allan said well
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it's time we did have some new thinking on Brands what do you got and I said
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well I think it's all about trust and you may recall the literature was very
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based on respect and Trust about a decade ago and he said that's not very exciting and it's not very fast company
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it's kind of business weeky but you know we really wanten be on the Leading Edge
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not behind it go away and think again so I went home pretty disconsolate you know
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despondent when you're in the ideas business and people stomp on your ideas it's not a great night so I went home
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and I live in tricker in New York and uh my wife's in New Zealand they're kind of
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a long way apart so I was there unloved my wife wasn't there Allan didn't like
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my idea so I opened a couple of bottles of red wine and was doodling around as you do at 2:30 in the morning and
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instead of trust marks I started to draw a little heart okay and I saw heart and
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marks and then love marks I thought man I got it this is so simple what's the
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deepest emotion of all so I went to bed 8:30 in the morning passed the 8:30 test
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called up Alan said man you got to come back he wrote a cover story about 3 weeks later on love marks and that how
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it was born it was then tested we proved it we researched it we figured it we kind of backfilled all the data into the
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concept which wouldn't you wouldn't do it knowledge Warton but it's what we did
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and we found out that yes indeed there was an incredible year learning for an emotional connection from consumers and
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about that time a lot of the thinking moved to emotional marketing so love marks was born really out of desperation
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and fear all right you have said in the past that one of the most successful examples of this is Michael Jordan when
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Nike hired him for their company people just absolutely established this incredible emotional connection with him
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somehow the company was able to start selling $70 shoes for2 $ he was a phenomenal success but then he
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retired what happens when your love Mark brand or your love Mark representative retires or goes into drug rehab or
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whatever how do you how do you keep that momentum up uh you've got to be authentic right and I think Nike had a
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very authentic position in you know they'd come from they started Life as a product which was very Innovative when
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bman introduced that the University of Oregon it was a waffle sold shoe that had benefit and attribute and it was
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lighter so it actually helped you run you know perform better right so it started Life classically as a product
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then when Phil Knight really got his juices flowing he turned it into a massively successful brand with all the
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brand iconography that we all familiar with the swoosh the just do it idea the kind of advertising approach that they
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took it took Jordan to move Nike from being if you like Irreplaceable to becoming irresistible
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because Jordan gave it aspiration he gave it emotional connectivity the whole idea was you know if you wear Nikes you
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can be like Mike which was a very aspirational thing for many people that's how the love Mark started for
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Nike and of course Nike the only purpose to create a love Mark is to charge a premium Brands were invented to charge
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premiums the premium went out of Brands she had to move into love marks Jordan went from $ sneakers as you said to
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selling $200 um Air Jordans then what happened two things Jordan retired and the sweat shop crisis right
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got really a big public heiring right it's very hard to love a company or a brand that is seen to be or perceived to
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be exploiting other humans right right because you know that's really tough thing Knight and the company then took a
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look at that and said whoa you know we got to go back to our roots so what did Nike do they went more and more local
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they sponsor every local college team every local soccer team every local athlete they continued with their Heroes
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Lance Armstrong and and Co but they moved right back into local Grass Roots they also addressed their sweat shop
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issue by a coming clean and B fixing it so love is something as it is in real life that you can win and you can lose
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it's certainly something you've got to earn every day and you can't take it for
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granted you've really got to get deep into the Grassroots of your consumer love marks are different to brands in
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one other key key way I think really brands are owned by brand managers and by companies okay and the biggest
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problem in business today is persuading companies to give up control because we've seen power shift you know when I
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grew up Brans had the power when I was at gillet or Proctor and Gamble man you know when I walked into to a store with
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Tide or Crest you were the King right I was the king okay and then we saw the the rise and Rise of Walmart you know
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the world's biggest company and we saw private label and we saw Aldi and we saw
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all the price guys and we saw Tesco in the UK kakur in France and we saw power switch from Brands to
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retailers that power has now gone forever Walmart has as little power as you can see from recent events as
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Proctor and Gamble as little or as much now power is switched to the consumer the consumer is boss and the consumer
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really will not be talked to or controlled she's in control so what we have to do is to give up control Nike
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had a hard time doing that had a hard time doing that now they've been able to
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do it they've been able to welcome the bloggers they've been able to welcome
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the interactivity so people are falling in love again what companies besides Nike have been able to establish this
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connection kind of to move Beyond that that yeah love marks are very personal right so they're personal to me and to
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you I mean the brands I love may not be the brands that you love but I mean Steve Jobs at Apple would be a classic
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example I mean you can buy any MP3 player in the world that is cheaper than an iPod you know kind of the batteries
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will work it won't give you as much frustration and you wouldn't dream of
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doing that right because you're in love with the iPod it's got a 75 share it's
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trebled the profits of the company and it's allowed him to restage the music
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industry right because iPods there are three things that we think make a love Mark they are mystery
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sensuality and intimacy words that are never used on your MBA program okay and these words are at the heart of today's
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consumer choice and you know un lever don't use them very much but you can see
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with Dove that they are starting to understand that intimacy PNG on Pampers are starting to understand the whole
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sensuality area even on tide they've now got smell and all this kind of stuff
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really deep into the brand so it's those three words and and apple really really
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drip with that Toyota has had a recent uh ad campaign on YouTube that was actually
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the creative people were from Sachi and sa La I believe um what is that say about how how big companies are now
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using social uh networking sites to promote their products and is this going to kind of change the way that that you
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work with companies the consumer's boss so we shouldn't really be thinking about
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companies anymore or Brands anymore you're spot on so companies like mine have got to re-calibrate away from being
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brand Centric or company Centric or client Centric or service Centric and be consumer Centric Yoshi ishisaka who ran
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Toyota for a decade said to me 10 years ago Kevin you will never know more about
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cars than Toyota and we will never know more about the people who buy them than Sachi and Sai
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our companies like us now have got to become very very close to Consumers that's complex because every
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consumer is different so the whole Mass reach and scale thing has gone it's complex because information
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and knowledge are now pure and simple table Stakes you will send you know the NBAs
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out of here they'll be fully equipped with information they'll be very knowledgeable how to use
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it you know Harvard will do the same Stanford will do the same not as well as you guys but they will in all or own
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their little way Focus very hard on information and knowledge what will win in our world is using those vital table
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Stakes quickly but then developing insight and foresight now you can't get insight and
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foresight from data and from analysis okay you've got to get it you know if you want to know a hell of a lot about
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lions you better go to the Jungle not to the zoo so you've got to figure out how
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you can empathetically now have the insight into a consumer behavior and then have the creative
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foresight to do something about that before the competition jobs and his folks are very empathetic I remember you
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also said recently that uh while other people are saying that that that television and newspapers are dead that
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actually the television is the most important medium and will be the most important medium for the next 20 years
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because a people have them including come people abroad and B people know how to use them it's pretty important and
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you've also said that stores are the second most important medium the actual
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going into stores shopping experience as opposed to online shopping do you still
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feel that way yeah I I I I feel that we live first of all in the screen age right and I've written a book called
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siso which is provides sight Sound and Motion none of us now are ever ever ever more than a few inches away from a
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screen because we all carry the mobile phone in our pocket we all have a computer at work or at home we all have
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five or six TV screens at home we have our iPod with us we're constantly in a
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world of the screen more and more that screen will be as it is in in many cases already it will be interactive and it
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will be social and it will be networked and it will be mobile so the screen is going to be the the first place we all
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go TV will be the absolute dominant screen in the world just look at China look at Russia look at India look at
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Brazil look at Indonesia and look at the way TVs are absolutely going crazy even
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in the US people still spend two and a half hours a day in front of a television screen and you know you're
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not going to watch a game of football on a 3X3 in iPod you're going to watch it
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on a 48 in high tech High digital TV screen right the way you watch it will differ because you will want to have
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control you will want to be interactive you will want to be working with the screen so the screen's vital for all of
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us and it's a great Communications medium because you can hear it you can see it you can touch it you can interact
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with it you should be able to smell it but you can't yet but you can on some
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sites you know you can smell smell of a pizza and so on it drives you crazy and then in the store 85% of decisions are
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made in store that store can be an online store or it can be a physical store but that's where the decision
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making is being made today because we live in a world where pretty much all products are
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parity right all products do as build anti- dandruff shampoos get rid of dandruff okay moisturizers help make
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your skin soft beer tastes good you know so it's not the differences that they
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used to be in quality or Price they're not there anymore so there's going to be
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an emotional connection for you that makes you select one shampoo versus another 85% of the time that decision
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takes place in store in less than 3 seconds boom most store experiences are revolting MH just terrible particularly
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supermarkets right right the idea now is creatively our creatives instead of now
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just focusing on a 60c 30 second TV spot boy they should start with an idea they
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should start with a consumer and they should start in store because if we can turn that store into a the of Dreams the
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the biggest thing that Apple did was stop selling in Best Stop relying on Best Buy and Walmart and open their own
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Store where the experience became an apple experience but how can you do that in a supermarket sure you can you can
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just take a fixture and you can instead of at the moment it's all fixtured um by product category instead
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of by consumer experience when you're in the cold season there are about 116
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products that you need if you're if you think you're going to get a cold well
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they're never merchandised together in fact it's just 87 cough you know medicines oh so we're trying to bore the
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consumer into submission okay uh is this I'm going to switch gears here is this truth or or is
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this legend that when you were the CEO of Pepsi Cola Canada during a presentation you actually had a Coke
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vending machine brought onto the stage and you took out a machine gun and you blasted away at it and I hid it and you
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hit it that's important part of that story I'm assuming they were blanks and
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I'm assuming that there was actually no one seriously hurt and I'm assuming you
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did that as a business you made a business decision when you did that so I'm wondering what
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your think I wasn't just pissed you know trying to blast a Coke but but the other
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question related to that is I know that that that must have totally energized your audience which included employees
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and it must have energized you how do you keep up that that pumped up energy that you need for the kind of job that
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you have we'll start with the truth behind the story the story yeah it's
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it's true it was I was the CEO of Canada and we were number two to Coke and we'd
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been number two to Coke for5 years and we were by neelon share indices about 0 five of a point behind
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them that period And I figured if we could take our guys over the edge we could get
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leadership the time it was the nor uh the na agreement the North American free trade agreement was the big big kind of
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thing and the Canadians were very frightened of it because they thought they would be swallowed by uh America
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because America have scale and you know blah blah blah blah blah blah blah blah blah and the guy called Brian Mone at
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the time was a prime minister of Canada and M had asked me to speak at some Pro because he was very Pro free trade and I
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was very pro- free trade would I speak at this big black tide dinner in Toronto and I said yes I would so we had the TV
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cameras there because because morone was there and because he was giving a speech
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suppor of free trade and I was opening the thing from from the role of business okay so I brought in a load of our big
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retail customers all of whom were very worried about free trade because they thought that Walmart were going to swamp
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lob laws and so on plus we had a load of so a lot of our customers there and a lot of key Pepsi people there a bunch of
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them and I made the point in my speech okay that competition was the way to go and that in this kind of free trade
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battle Canada would become stronger because we were fast we were flexible we could move quicker you know and all this
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kind of stuff and that we would be made better by the American competitors they would lift our game etc etc and I talked
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about how Pepsi in Canada was a company driven by all local bottlers and no local entrepreneurs whereas Coke was
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owned by the US company and I said so here we are right and here's what's
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going to happen to us and we're going to go with all my Canadian Vancouver botler
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and Kea bottlers we're going to go past them man I'm telling you and at that time I
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opened the the the theater curtains and brought on a big Coca-Cola vending machine bent down put on a a safety
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goggles picked up a machine gun and blew the thing into pieces everybody hit the
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deck they were you know ball gowns going all over the places handbags going we'
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of course told the Royal Canadian man police so they didn't shoot me cuz I was
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kind of nervous that somebody was going to pull a I would never have done it in Detroit or anything like that so and yes
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it was blank what it was I had all the vending machine lit up electronically so all I had to do was to hit it with a
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rubber bullet and the explosives inside of course what happened for the next three weeks the whole media was all over
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this thing it was shot across every piece of television and it was always with the line here's Pepsi going to go
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past coke blowing this every sales call my guys meant start started off with you
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work for that crazy guy who shot up the machine instant it's fantastic and we
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went past them right that so it was just that momentum theater to tip up over the
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edge and I think how do you keep yourself going I mean I'm if you're in a
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creative industry I'm in the ideas business right you know we live in the age of the idea Walton's in the ideas
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business right you're in the Innovation Business Without that you die I'm in the
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same business it's pretty exciting you know I'm not into process or routine or
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bureaucracy or what went before it's all about getting to the Future first um so
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if you can't get excited you know I'm surrounded by 5,000 creative people and
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you can never get those Eagles to fly in formation so you better enjoy it you I also read that that one of that your
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favorite job on the way up to the top or up on the way up to the current job you
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have now was as a brand manager for PNG in the 1970s what was so special about that learning you know I was kicked out
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of school when I was 17 so I wasn't able to do an NBA at Wharton so at the age of
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25 I realized that my peers were simply smarter than me I was faster tougher more aggressive whatever else but they
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were smarter and in the end I thought you know what you you can't you can have
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as much EQ as you want but if you've got an IQ Gap it's not going to be very
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helpful I better fill that Gap and uh at the time I was working for the Gillette
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company and PNG never ever hired from other companies and I persuaded them that with me I was still only 25 they
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should make an exception so they started me at they punished me obviously being Proctor right as the lowest assistant on
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the on on the totem pole and uh I learned there for seven or eight years I must have learned 30 things a day and
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everything I now know about marketing pretty much was founded then right and when you went to when you went to Sachi
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and sa in 1997 I understand you were brought in to kind of revive was somewhat of a
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flagging company bad morale Etc and you're expected to bring in a whole team
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of people but you made a conscious decision not to let any of the old team go for two years now that's kind of
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counterintuitive to what we hear when they bring in new CEOs they they rush into bring their new team they get rid
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of all the dead word that they perceive as there why did you make that decision and did it work um I'd never worked in
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advertising before so I didn't really know much about advertising so I thought
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it would be kind of better if I if I work with the people that didn't know about advertising cuz I really didn't
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know anything about it I had no idea how an advertising agency worked cuz i' only
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worked on the other side I also think zigging when other zag is is kind of where I'd like to start so the very fact
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that everybody did it the other way around made me think well that usually doesn't work so let me have a another
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think about it and then I met the people in the first three days and I thought you know they're okay all that you're
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suffering from is a leadership vacuum you don't have a purpose you don't have
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a dream you don't have a framework you've been let down by the the two Sai
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brothers who led the company in typical style from a great entrepreneurial company to the biggest in the world and
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couldn't keep up so then it you know collapsed financially not not through functionally everybody's morale was
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battered and heaved but from a capability point of view I thought they were all still top talent M uh and it
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were I mean we've grown yeah you know our business 11 years out of 11 Revenue
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11 years out of 11 margin top in the world creatively and got rid of the $2 billion debt and didn't um go into
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bankruptcy which is where we were heading right what's the best ad campaign you've ever
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seen uh the best ad campaign I've ever seen uh I don't spend a lot of time on
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ad campaign say the truth I think it was for Castleman Forex a beerer that you would never have heard of um in
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Australia and so the brand was Forex is like doseki in in Mexico so we had four cuz everything in Australia is bigger
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it's a bit like Texas so we had four and and the campaign was run to launch the
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Aussie logger in the UK and the campaign line was Aussies don't give up XXX for any other logger right and every
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execution was around that you know and uh it was it was it was absolutely absolutely Dynamic yeah one final
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question you were born in in England you live in Tribeca but actually your family
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and your your wife and children are in New Zealand where your home is why New Zealand uh I went there in 1989 head
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hunted to run the what was then the biggest company in New Zealand two companies merged together lion a big
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Brewer soft drink manufacturer and Nathan a big retailer that had the equivalent of Target and woolest and all
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those franchises they put these two companies together and had no idea how to run them or what to do with them once
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they would come together they wanted someone with International experience because they knew the future was outside
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of New Zealand cuz we only have 4 million people mhm and yes there are 25 million sheep there so we can move
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forward on that which would be good if they had purchasing power but they don't
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so so there's 4 million uh people and the businesses had nothing to do with each other at all right so we had to
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strategically decide how to go offshore what businesses to keep which businesses
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to sell and they wanted a someone from outside of both companies right to sit on top of it again and not a not a
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typical solution typically one guy would have won and one guy would have lost so
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I sat just on the top and they wanted someone who was not an American because I felt that Americans in New Zealand
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would probably not necessarily understand I'd been working in Canada I was born in England and they found that
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culture closer to New Zealand but you could have settled your family in any country you you probably been to what 90
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countries in the world you could have settled in any one have you been to New Zealand no well that would answer the
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question yeah it's Paradise I became in New Zealand within two years it's a
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value driven Society a value driven on egalitarianism on social equality on environmental issues and on great
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education for all so I'm from workingclass England it was like being transplanted into a place that the
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southern upper class hadn't ruined oh great thank you for joining us thank you
00:24:52
very much for more information please visit knowledge. . up.edu [Music]