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this podcast is brought to you by
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knowledge at Warton please visit
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knowledge. won. up.edu for more
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information Kevin Roberts has been CEO
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worldwide of Sachi and sa since 1997 and
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in the space of 11 years has cemented
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the ad agency's reputation as one of the
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most successful and creative companies
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in the industry among Sachi and sa's
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clients are Proctor and Gamble General
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Mills nartis Toyota JC Penney and the
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New York State Department of Economic
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Development Roberts who travels the
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world for a new york-based company is
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perhaps most well known for an idea he
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came up with called love marks which
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means creating a brand for which the
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consumer has quote loyalty Beyond Reason
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end quote before joining Sachi and Sai
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Roberts worked for Mary Quant Cosmetics
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Gillette Proctor and Gamble and
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pepsicola
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Kevin thanks for joining
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us can you tell us tell us a little bit
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more about your love Mark idea and why
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it's been such a
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hit I it started about eight nine years
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ago when I was growing very concerned
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that mass marketing and commodification
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was going to put companies like mine out
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of business I thought Brands were
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getting strangled by assistant brand
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managers and by promotion budgets and by
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retailers so I started to think about
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what was the future Beyond brands
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um and I had a conversation with a guy
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called Alan Weber who at the time was
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the editor of Fast Company when the Fast
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Company was very hot and Allan said well
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it's time we did have some new thinking
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on Brands what do you got and I said
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well I think it's all about trust and
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you may recall the literature was very
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based on respect and Trust about a
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decade ago and he said that's not very
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exciting and it's not very fast company
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it's kind of business weeky but you know
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we really wanten be on the Leading Edge
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not behind it go away and think again so
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I went home pretty disconsolate you know
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despondent when you're in the ideas
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business and people stomp on your ideas
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it's not a great night so I went home
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and I live in tricker in New York and uh
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my wife's in New Zealand they're kind of
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a long way apart so I was there unloved
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my wife wasn't there Allan didn't like
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my idea so I opened a couple of bottles
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of red wine and was doodling around as
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you do at 2:30 in the morning and
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instead of trust marks I started to draw
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a little heart okay and I saw heart and
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marks and then love marks I thought man
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I got it this is so simple what's the
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deepest emotion of all so I went to bed
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8:30 in the morning passed the 8:30 test
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called up Alan said man you got to come
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back he wrote a cover story about 3
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weeks later on love marks and that how
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it was born it was then tested we proved
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it we researched it we figured it we
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kind of backfilled all the data into the
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concept which wouldn't you wouldn't do
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it knowledge Warton but it's what we did
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and we found out that yes indeed there
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was an incredible year learning for an
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emotional connection from consumers and
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about that time a lot of the thinking
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moved to emotional marketing so love
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marks was born really out of desperation
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and fear all right you have said in the
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past that one of the most successful
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examples of this is Michael Jordan when
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Nike hired him for their company people
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just absolutely established this
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incredible emotional connection with him
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somehow the company was able to start
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selling $70 shoes for2 $ he was a
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phenomenal success but then he
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retired what happens when your love Mark
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brand or your love Mark representative
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retires or goes into drug rehab or
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whatever how do you how do you keep that
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momentum up uh you've got to be
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authentic right and I think Nike had a
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very authentic position in you know
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they'd come from they started Life as a
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product which was very Innovative when
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bman introduced that the University of
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Oregon it was a waffle sold shoe that
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had benefit and attribute and it was
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lighter so it actually helped you run
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you know perform better right so it
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started Life classically as a product
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then when Phil Knight really got his
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juices flowing he turned it into a
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massively successful brand with all the
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brand iconography that we all familiar
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with the swoosh the just do it idea the
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kind of advertising approach that they
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took it took Jordan to move Nike from
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being if you like
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Irreplaceable to becoming irresistible
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because Jordan gave it aspiration he
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gave it emotional connectivity the whole
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idea was you know if you wear Nikes you
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can be like Mike which was a very
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aspirational thing for many people
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that's how the love Mark started for
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Nike and of course Nike the only purpose
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to create a love Mark is to charge a
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premium Brands were invented to charge
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premiums the premium went out of Brands
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she had to move into love marks Jordan
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went from $ sneakers as you said to
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selling $200 um Air
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Jordans then what happened two things
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Jordan
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retired and the sweat shop crisis right
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got really a big public heiring right
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it's very hard to love a company or a
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brand that is seen to be or perceived to
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be exploiting other humans right right
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because you know that's really tough
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thing Knight and the company then took a
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look at that and said whoa you know we
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got to go back to our roots so what did
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Nike do they went more and more local
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they sponsor every local college team
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every local soccer team every local
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athlete they continued with their Heroes
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Lance Armstrong and and Co but they
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moved right back into local Grass Roots
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they also addressed their sweat shop
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issue by a coming clean and B fixing it
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so love is something as it is in real
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life that you can win and you can lose
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it's certainly something you've got to
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earn every day and you can't take it for
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granted you've really got to get deep
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into the Grassroots of your consumer
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love marks are different to brands in
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one other key key way I think really
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brands are owned by brand managers and
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by companies okay and the biggest
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problem in business today is persuading
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companies to give up control because
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we've seen power shift you know when I
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grew up Brans had the power when I was
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at gillet or Proctor and Gamble man you
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know when I walked into to a store with
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Tide or Crest you were the King right I
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was the king okay and then we saw the
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the rise and Rise of Walmart you know
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the world's biggest company and we saw
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private label and we saw Aldi and we saw
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all the price guys and we saw Tesco in
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the UK kakur in France and we saw power
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switch from Brands to
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retailers that power has now gone
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forever Walmart has as little power as
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you can see from recent events as
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Proctor and Gamble as little or as much
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now power is switched to the consumer
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the consumer is boss and the consumer
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really will not be talked to or
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controlled she's in control so what we
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have to do is to give up control Nike
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had a hard time doing that had a hard
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time doing that now they've been able to
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do it they've been able to welcome the
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bloggers they've been able to welcome
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the interactivity so people are falling
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in love again what companies besides
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Nike have been able to establish this
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connection kind of to move Beyond that
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that yeah love marks are very personal
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right so they're personal to me and to
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you I mean the brands I love may not be
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the brands that you love but I mean
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Steve Jobs at Apple would be a classic
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example I mean you can buy any MP3
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player in the world that is cheaper than
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an iPod you know kind of the batteries
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will work it won't give you as much
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frustration and you wouldn't dream of
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doing that right because you're in love
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with the iPod it's got a 75 share it's
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trebled the profits of the company and
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it's allowed him to restage the music
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industry right because
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iPods there are three things that we
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think make a love Mark they are mystery
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sensuality and intimacy words that are
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never used on your MBA program okay and
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these words are at the heart of today's
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consumer choice and you know un lever
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don't use them very much but you can see
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with Dove that they are starting to
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understand that intimacy PNG on Pampers
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are starting to understand the whole
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sensuality area even on tide they've now
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got smell and all this kind of stuff
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really deep into the brand so it's those
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three words and and apple really really
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drip with
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that Toyota has had a recent uh ad
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campaign on YouTube that was actually
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the creative people were from Sachi and
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sa La I believe um what is that say
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about how how big companies are now
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using social uh networking sites to
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promote their products and is this going
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to kind of change the way that that you
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work with companies the consumer's boss
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so we shouldn't really be thinking about
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companies anymore or Brands anymore
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you're spot on so companies like mine
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have got to re-calibrate away from being
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brand Centric or company Centric or
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client Centric or service Centric and be
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consumer Centric Yoshi ishisaka who ran
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Toyota for a decade said to me 10 years
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ago Kevin you will never know more about
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cars than Toyota
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and we will never know more about the
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people who buy them than Sachi and Sai
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our companies like us now have got to
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become very very close to
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Consumers that's complex because every
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consumer is different so the whole Mass
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reach and scale thing has
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gone it's complex because information
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and
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knowledge are now pure and simple table
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Stakes you will send you know the NBAs
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out of here they'll be fully equipped
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with information
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they'll be very knowledgeable how to use
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it you know Harvard will do the same
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Stanford will do the same not as well as
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you guys but they will in all or own
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their little way Focus very hard on
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information and knowledge what will win
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in our world is using those vital table
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Stakes quickly but then developing
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insight and
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foresight now you can't get insight and
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foresight from data and from analysis
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okay you've got to get it you know if
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you want to know a hell of a lot about
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lions you better go to the Jungle not to
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the zoo so you've got to figure out how
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you can empathetically
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now have the insight into a consumer
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behavior and then have the creative
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foresight to do something about that
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before the competition jobs and his
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folks are very empathetic I remember you
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also said recently that uh while other
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people are saying that that that
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television and newspapers are dead that
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actually the television is the most
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important medium and will be the most
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important medium for the next 20 years
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because a people have them including
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come people abroad and B people know how
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to use them it's pretty important and
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you've also said that stores are the
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second most important medium the actual
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going into stores shopping experience as
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opposed to online shopping do you still
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feel that way yeah I I I I feel that we
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live first of all in the screen age
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right and I've written a book called
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siso which is provides sight Sound and
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Motion none of us now are ever ever ever
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more than a few inches away from a
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screen because we all carry the mobile
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phone in our pocket we all have a
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computer at work or at home we all have
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five or six TV screens at home we have
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our iPod with us we're constantly in a
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world of the screen more and more that
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screen will be as it is in in many cases
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already it will be interactive and it
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will be social and it will be networked
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and it will be mobile so the screen is
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going to be the the first place we all
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go TV will be the absolute dominant
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screen in the world just look at China
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look at Russia look at India look at
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Brazil look at Indonesia and look at the
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way TVs are absolutely going crazy even
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in the US people still spend two and a
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half hours a day in front of a
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television screen and you know you're
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not going to watch a game of football on
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a 3X3 in iPod you're going to watch it
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on a 48 in high tech High digital TV
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screen right the way you watch it will
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differ because you will want to have
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control you will want to be interactive
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you will want to be working with the
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screen so the screen's vital for all of
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us and it's a great Communications
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medium because you can hear it you can
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see it you can touch it you can interact
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with it you should be able to smell it
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but you can't yet but you can on some
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sites you know you can smell smell of a
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pizza and so on it drives you crazy and
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then in the store 85% of decisions are
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made in store that store can be an
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online store or it can be a physical
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store but that's where the decision
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making is being made today because we
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live in a world
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where pretty much all products are
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parity right all products do as build
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anti- dandruff shampoos get rid of
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dandruff okay moisturizers help make
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your skin soft beer tastes good you know
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so it's not the differences that they
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used to be in quality or Price they're
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not there anymore so there's going to be
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an emotional connection for you that
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makes you select one shampoo versus
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another 85% of the time that decision
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takes place in store in less than 3
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seconds boom most store experiences are
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revolting MH just terrible particularly
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supermarkets right right the idea now is
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creatively our creatives instead of now
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just focusing on a 60c 30 second TV spot
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boy they should start with an idea they
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should start with a consumer and they
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should start in store because if we can
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turn that store into a the of Dreams the
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the biggest thing that Apple did was
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stop selling in Best Stop relying on
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Best Buy and Walmart and open their own
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Store where the experience became an
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apple experience but how can you do that
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in a supermarket sure you can you can
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just take a fixture and you can instead
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of at the moment it's all
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fixtured um by product category instead
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of by consumer experience when you're in
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the cold season there are about 116
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products that you need if you're if you
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think you're going to get a cold well
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they're never merchandised together in
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fact it's just 87 cough you know
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medicines oh so we're trying to bore the
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consumer into
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submission okay uh is this I'm going to
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switch gears here is this truth or or is
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this legend that when you were the CEO
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of Pepsi Cola Canada during a
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presentation you actually had a Coke
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vending machine brought onto the stage
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and you took out a machine gun and you
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blasted away at it and I hid it and you
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hit it that's important part of that
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story I'm assuming they were blanks and
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I'm assuming that there was actually no
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one seriously hurt and I'm assuming you
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did that as a
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business you made a business decision
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when you did that so I'm wondering what
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your think I wasn't just pissed you know
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trying to blast a Coke but but the other
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question related to that is I know that
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that that must have totally energized
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your audience which included employees
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and it must have energized you how do
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you keep up that that pumped up energy
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that you need for the kind of job that
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you have we'll start with the truth
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behind the story the story yeah it's
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it's true it was I was the CEO of Canada
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and we were number two to Coke and we'd
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been number two to Coke
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for5 years and we were by neelon share
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indices about 0 five of a point behind
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them that period And I figured if we
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could take our guys over the edge we
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could get
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leadership the time it was the nor uh
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the na agreement the North American free
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trade agreement was the big big kind of
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thing and the Canadians were very
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frightened of it because they thought
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they would be swallowed by uh America
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because America have scale and you know
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blah blah blah blah blah blah blah blah
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blah and the guy called Brian Mone at
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the time was a prime minister of Canada
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and M had asked me to speak at some Pro
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because he was very Pro free trade and I
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was very pro- free trade would I speak
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at this big black tide dinner in Toronto
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and I said yes I would so we had the TV
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cameras there because because morone was
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there and because he was giving a speech
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suppor of free trade and I was opening
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the thing from from the role of business
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okay so I brought in a load of our big
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retail customers all of whom were very
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worried about free trade because they
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thought that Walmart were going to swamp
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lob laws and so on plus we had a load of
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so a lot of our customers there and a
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lot of key Pepsi people there a bunch of
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them and I made the point in my speech
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okay that competition was the way to go
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and that in this kind of free trade
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battle Canada would become stronger
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because we were fast we were flexible we
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could move quicker you know and all this
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kind of stuff and that we would be made
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better by the American competitors they
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would lift our game etc etc and I talked
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about how Pepsi in Canada was a company
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driven by all local bottlers and no
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local entrepreneurs whereas Coke was
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owned by the US company and I said so
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here we are right and here's what's
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going to happen to us and we're going to
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go with all my Canadian Vancouver botler
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and Kea
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bottlers we're going to go past them man
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I'm telling you and at that time I
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opened the
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the the theater curtains and brought on
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a big Coca-Cola vending
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machine bent down put on a a safety
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goggles picked up a machine gun and blew
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the thing into pieces everybody hit the
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deck they were you know ball gowns going
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all over the places handbags going we'
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of course told the Royal Canadian man
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police so they didn't shoot me cuz I was
00:17:59
kind of nervous that somebody was going
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to pull a I would never have done it in
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Detroit or anything like that so and yes
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it was blank what it was I had all the
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vending machine lit up electronically so
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all I had to do was to hit it with a
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rubber bullet and the explosives inside
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of course what happened for the next
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three weeks the whole media was all over
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this thing it was shot across every
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piece of television and it was always
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with the line here's Pepsi going to go
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past coke blowing this every sales call
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my guys meant start started off with you
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work for that crazy guy who shot up the
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machine instant it's fantastic and we
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went past them right that so it was just
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that momentum theater to tip up over the
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edge and I think how do you keep
00:18:45
yourself going I mean I'm if you're in a
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creative industry I'm in the ideas
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business right you know we live in the
00:18:49
age of the idea Walton's in the ideas
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business right you're in the Innovation
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Business Without that you die I'm in the
00:18:56
same business it's pretty exciting you
00:18:58
know I'm not into process or routine or
00:19:00
bureaucracy or what went before it's all
00:19:04
about getting to the Future first um so
00:19:07
if you can't get excited you know I'm
00:19:08
surrounded by 5,000 creative people and
00:19:10
you can never get those Eagles to fly in
00:19:12
formation so you better enjoy it you I
00:19:15
also read that that one of that your
00:19:17
favorite job on the way up to the top or
00:19:20
up on the way up to the current job you
00:19:22
have now was as a brand manager for PNG
00:19:24
in the 1970s what was so special about
00:19:27
that learning you know I was kicked out
00:19:29
of school when I was 17 so I wasn't able
00:19:31
to do an NBA at Wharton so at the age of
00:19:33
25 I realized that my peers were simply
00:19:36
smarter than me I was faster tougher
00:19:38
more aggressive whatever else but they
00:19:40
were smarter and in the end I thought
00:19:42
you know what you you can't you can have
00:19:44
as much EQ as you want but if you've got
00:19:46
an IQ Gap it's not going to be very
00:19:48
helpful I better fill that Gap and uh at
00:19:51
the time I was working for the Gillette
00:19:52
company and PNG never ever hired from
00:19:55
other companies and I persuaded them
00:19:58
that with me I was still only 25 they
00:20:00
should make an exception so they started
00:20:02
me at they punished me obviously being
00:20:04
Proctor right as the lowest assistant on
00:20:06
the on on the totem pole and uh I
00:20:10
learned there for seven or eight years I
00:20:12
must have learned 30 things a day and
00:20:15
everything I now know about marketing
00:20:17
pretty much was founded then right and
00:20:21
when you went to when you went to Sachi
00:20:23
and sa in
00:20:25
1997 I understand you were brought in to
00:20:27
kind of revive was somewhat of a
00:20:29
flagging company bad morale Etc and
00:20:32
you're expected to bring in a whole team
00:20:34
of people but you made a conscious
00:20:36
decision not to let any of the old team
00:20:38
go for two years now that's kind of
00:20:40
counterintuitive to what we hear when
00:20:42
they bring in new CEOs they they rush
00:20:44
into bring their new team they get rid
00:20:45
of all the dead word that they perceive
00:20:47
as there why did you make that decision
00:20:49
and did it work um I'd never worked in
00:20:52
advertising before so I didn't really
00:20:53
know much about advertising so I thought
00:20:55
it would be kind of better if I if I
00:20:57
work with the people that didn't know
00:20:59
about advertising cuz I really didn't
00:21:00
know anything about it I had no idea how
00:21:02
an advertising agency worked cuz i' only
00:21:04
worked on the other side I also think
00:21:06
zigging when other zag is is kind of
00:21:08
where I'd like to start so the very fact
00:21:10
that everybody did it the other way
00:21:11
around made me think well that usually
00:21:13
doesn't work so let me have a another
00:21:16
think about it and then I met the people
00:21:19
in the first three days and I thought
00:21:20
you know they're okay all that you're
00:21:21
suffering from is a leadership vacuum
00:21:24
you don't have a purpose you don't have
00:21:26
a dream you don't have a framework
00:21:28
you've been let down by the the two Sai
00:21:30
brothers who led the company in typical
00:21:33
style from a great entrepreneurial
00:21:35
company to the biggest in the world and
00:21:37
couldn't keep up so then it you know
00:21:40
collapsed financially not not through
00:21:43
functionally everybody's morale was
00:21:45
battered and heaved but from a
00:21:47
capability point of view I thought they
00:21:48
were all still top talent M uh and it
00:21:52
were I mean we've grown yeah you know
00:21:54
our business 11 years out of 11 Revenue
00:21:56
11 years out of 11 margin top in the
00:21:58
world creatively and got rid of the $2
00:22:01
billion debt and didn't um go into
00:22:03
bankruptcy which is where we were
00:22:05
heading right what's the best ad
00:22:07
campaign you've ever
00:22:08
seen uh the best ad campaign I've ever
00:22:10
seen uh I don't spend a lot of time on
00:22:13
ad campaign say the truth I think it was
00:22:14
for Castleman Forex a beerer that you
00:22:16
would never have heard of um in
00:22:19
Australia and so the brand was Forex is
00:22:22
like doseki in in Mexico so we had four
00:22:24
cuz everything in Australia is bigger
00:22:25
it's a bit like Texas so we had four and
00:22:28
and the campaign was run to launch the
00:22:31
Aussie logger in the UK and the campaign
00:22:34
line was Aussies don't give up
00:22:37
XXX for any other logger right and every
00:22:42
execution was around that you know and
00:22:45
uh it was it was it was absolutely
00:22:48
absolutely Dynamic yeah one final
00:22:51
question you were born in in England you
00:22:55
live in Tribeca but actually your family
00:22:57
and your your wife and children are in
00:22:58
New Zealand where your home is why New
00:23:01
Zealand uh I went there in 1989 head
00:23:03
hunted to run the what was then the
00:23:06
biggest company in New Zealand two
00:23:07
companies merged together lion a big
00:23:10
Brewer soft drink manufacturer and
00:23:12
Nathan a big retailer that had the
00:23:14
equivalent of Target and woolest and all
00:23:16
those franchises they put these two
00:23:19
companies together and had no idea how
00:23:20
to run them or what to do with them once
00:23:23
they would come together they wanted
00:23:25
someone with International experience
00:23:27
because they knew the future was outside
00:23:28
of New Zealand cuz we only have 4
00:23:30
million people mhm and yes there are 25
00:23:33
million sheep there so we can move
00:23:34
forward on that which would be good if
00:23:36
they had purchasing power but they don't
00:23:37
so so there's 4 million uh people and
00:23:41
the businesses had nothing to do with
00:23:42
each other at all right so we had to
00:23:45
strategically decide how to go offshore
00:23:48
what businesses to keep which businesses
00:23:50
to sell and they wanted a someone from
00:23:54
outside of both companies right to sit
00:23:57
on top of it again and not a not a
00:23:58
typical solution typically one guy would
00:24:01
have won and one guy would have lost so
00:24:02
I sat just on the top and they wanted
00:24:05
someone who was not an American because
00:24:08
I felt that Americans in New Zealand
00:24:11
would probably not necessarily
00:24:13
understand I'd been working in Canada I
00:24:16
was born in England and they found that
00:24:17
culture closer to New Zealand but you
00:24:19
could have settled your family in any
00:24:21
country you you probably been to what 90
00:24:23
countries in the world you could have
00:24:24
settled in any one have you been to New
00:24:26
Zealand no well that would answer the
00:24:28
question yeah it's Paradise I became in
00:24:29
New Zealand within two years it's a
00:24:32
value driven Society a value driven on
00:24:35
egalitarianism on social equality on
00:24:37
environmental issues and on great
00:24:40
education for all so I'm from
00:24:42
workingclass England it was like being
00:24:44
transplanted into a place that the
00:24:47
southern upper class hadn't ruined oh
00:24:49
great thank you for joining us thank you
00:24:52
very
00:24:54
much for more information please visit
00:24:57
knowledge. . up.edu
00:25:01
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