Welcome to the first episode of The CMO Show, a podcast by Filtered Media about brand storytelling and the future of marketing.
Our first guest is Robert Rose, chief strategy officer at Content Marketing Institute, and a thought leader in content marketing, digital media and the social web. He’s also co-host of This Old Marketing podcast with Joe Pulizzi.
Robert joins Mark Jones, chief storyteller + CEO Filtered Media, to talk about Content Marketing World Sydney, how to succeed in enterprise content marketing, and why Marriott, Red Bull and Kraft are getting it right. Warning: Contains a gratuitous reference to Guns N’ Roses.
Host: Mark Jones (MJ)
Guest: Robert Rose (RR)
MJ: Robert Rose, thanks for joining us on the CMO Show. Let’s kick off with the most obvious thing we have to talk about which of course is Content Marketing World Sydney. What are you looking forward to?
RR: First I’m most looking forward to being in Sydney – it’s my second favourite place on the planet. My first is Los Angeles, where I live. Second of all, I’m looking forward to the event. This will be our third time there, and every year seems to get a little more exciting and a little more interesting… I’m really, really looking forward to it.
MJ: Likewise, I probably should give a quick qualification to say we’re a sponsor of the event too. From my point of view I feel like we’re part of something that’s growing and I’m really looking forward to it. I’m interested because I’ve been following you guys for quite a few years now, and one of the things that CMI focuses on is tracking markets and market growth. Last year there was a report that you put out talking about the maturity of the market here, and the move from marketers really looking at a more strategic approach to planning their content marketing. How do you think it will be evolving this year?
RR: So this year, what we discovered putting together a strategy, there was a marked gap between those that actually wrote it down and referred to it frequently and actually used the strategies that they created, versus those that threw spaghetti against the wall to see what might stick. What I’ve noticed as a trend specifically in Australia – and let’s assume that Australia’s a little bit behind – what it’s doing is it’s avoiding many of the mistakes that the US made.
MJ: I’m sure there’ll be people listening saying: well I thought we were better than those guys. I’d be interested to unpack a little bit – this gap that you identified, I actually relate to that in the productivity context. We talk about a productivity gap in the enterprise, that’s quite a well-understood thing is the gap getting larger in the content marketing sense, is that what you’re saying?
RR: It is for the most part, content marketing is considered either an experiment, or it is something that is done on the side, separate to regular marketing and communication strategy. Somebody says, let’s launch a blog, or let’s do a print magazine or let’s try a webinar program or let’s try something, and it’s separated off, and treated as such. It’s never made real in the organisation.
So the brands that we’re seeing really succeed at this, are actually making content a function in the business, where it is somebody’s job, somebody is responsible for it. It becomes a recognised function in the business.
That’s when it actually has a chance for success.
MJ: If we go back two years, and if I think from a CMO’s perspective, they might say: well hang on a minute, didn’t you say to me a couple of years ago we should experiment, we should try something, set aside a little bit of budget, pick a blog or something, and give it a go and see what happens? Now we’re turning around and saying; stop doing that?
RR: No I’m not saying stop experimenting, look experimentation is one thing, but experimentation in a proper format is another. The other objection to this is not being able to measure content marketing for a year or for six months or eight months, you know you can’t measure it til it’s way out there. Well that’s not true either. But the challenge is we confuse success of our platform for contribution to the business. So we launch a blog, and say it’s going to produce 25% more leads into the organisation, or it’s going to decrease our cost per lead by X percentage.
Then we launch that blog, we launch that platform, and a week after it launches we ask whether it’s producing the requisite goal, and the answer is of course, no. So it’s deemed a failure and we sort of say it’s a failed experiment. Instead we have to look at it as we would investing in a product.
In other words, giving a talented person the ability to create and measure and manage something of value, putting the requisite budget into marketing, promoting and then maybe giving it the level of time that it needs in order to prove that it’s actually going to be successful over time.
MJ: So more time, more money?
RR: Well, yes, in theory yes. Time is a factor of money right. My experience is that if you want something faster you just spend more for it. So either time or money or both.
MJ: Right, but how do you actually get to that point? Particularly from my experience, just seeing a shift in the executive mindset around how we’re going to treat this thing, and you’re alluding to that. But we actually have to get to that point. We’ve got to agree and, you know this very well, large organisations have many stakeholders, lots of complexities, lots of silos. How do we get everybody onboard with this thing? It’s actually quite a complex, socio-business-political, organism thing right? Am I not wrong?
RR: No you’re absolutely right – this is a culture-eats-strategy-for-breakfast thing, we are looking at trying to change the core beliefs of what the company has been doing – in some cases – for decades, in some cases centuries. So trying to change the way that a business goes to market using content can be an extraordinarily disruptive thing. But you said it really – I love the way you just outlined that. Because what that inherently defines is that we’re going to actually create a strategy for it.
MJ: You might remember an old, an album by Guns N’ Roses, Appetite for Destruction. I don’t know if that’s…
RR: Of course, I’m here in LA! Come on now…
MJ: There you go, yeah come on, oh sorry, well I don’t know your music tastes. But certainly when I was growing up that was kind of iconic, Appetite for Destruction. It just kind of sprung to mind just now. For CMOs you really have to have that appetite for destruction, or positively spun transformation, innovation, a desire to change cultures and to achieve something that’s much bigger right? But I guess my question is – and you’ve got a global perspective – what’s the appetite for destruction amongst CMOs? Do they understand what they’re doing here, do they understand what they’re getting into?
RR: Yeah they don’t – you’ve nailed it on the head right. When I come across objections, mostly in older industries – and it’s not a gender thing, it’s men and women, but they’re in there and they’re looking at it and they’re saying: I think this is going to be a big thing. But not on my watch. I’ve got four or five years left before I go and retire, and I’m going to let the kid behind me sort of do this stuff.
MJ: I guess we’re jumping to politics here, but there’s that same thing, I don’t want to lose my seat at the next election, I don’t want to lose my job. There’s an inherent self interest; If I push this agenda too hard, it’s not going to be too great for paying the mortgage and looking after my kids. Is there a tension there as well?
RR: Yeah I mean this is the classic, everybody-wants-to-be-innovative thing but not if it has a chance of failing – which of course by definition, if it’s innovative it’s new and you have no idea if it’s going to fail. So it’s much easier for a CMO to say: You know what, I can just incrementally work on improving the results of my e-commerce or my results of my in-store sales by 5 or 10 per cent every year. That keeps my job, I get my bonus and I can go home. Or, he could work on a step function that’s going to exponentially bring [the company] up to 20 or 25 or 30 percent growth, but also might fail. It might be a really expensive failure. He’s going to choose the former one every time.
MJ: You know it’s KPI management right? I’m just going to look at my numbers…
RR: Yeah, that’s exactly right, that’s exactly right.
MJ: What do you say to companies when you go in? My background is publishing, so I’ve been a journalist for a long time, and an editor, and been in publishing circles. I wonder whether you know we need to actually paint the bigger picture first, we need to actually go to senior executives and say you know what, we’re becoming a publisher. The old think like a brand, act like a publisher. We need to kind of paint that picture, and get them excited about something that’s, if you like, at a higher level…
RR: Yes, absolutely. I mean you’ve framed it very well. You can go in with as much data and a big stack of business case and a huge PowerPoint presentation and you won’t win unless you get people excited. It doesn’t really matter what industry you’re in, there’s a really good chance that the Internet and the digital world that we live in is being fundamentally disrupted, which means that customer loyalty to what we do is now really about the experience, because the product or service that we offer is becoming commoditised. So we have to change the approach of what we do as a business, where we are creating value for our customers. That experience that we can create is really what differentiates. You think about the classic examples that are out there, the Zappos of the world that are changing the way that people buy shoes to Amazon, to Netflix, to you know all of the different businesses that are majorly disrupting other businesses, and what they’re doing is creating a different experience for that customer.
In other words, marketers have been historically great at describing value. We’re great at putting unique value propositions and headlines and reasons to believe, and unique sales propositions, and all those things together. We’re good at that. What we’re not good at yet is creating discrete separated value that delivers value to a customer in some form of their buyers journey with us, and delivering that to them so they actually differentiate us against all these commoditised products that they now have a click away to go buy a competing product. So content will either be this by-product that spews out the back of your company like some Dr Seuss machine, or it can be a differentiating asset that you treat as such. So treating content as a strategic asset is a no brainer to me, and it strikes me that it’s funny when companies don’t look at it that way.
MJ: Yeah, I agree. You know what, I lived in San Francisco in the dotcom crash, 2000 to 2003, and I saw an incredible appetite for trying new things, and also not losing your job, during that whole period of time. What struck me though was – and I think in the Asia Pacific region maybe we have a different perspective, but generally speaking American business culture is actually quite conservative in my view. You might correct me on that, but my take is that we’re saying in one hand, one sense you’re leading this content marketing revolution – without wanting to overhype it, but at the same time the culture is extremely conservative compared to some of the risk taking I see here in Australia. So I wonder you know how you see that in terms of the speed of this evolution? Is it actually going to take much longer than we think?
RR: You know, it’s a great question. I mean I can’t speak specifically to the Australian market because I don’t know it as well as you do, so I won’t try and frame that up. But I can speak to the American market, and I can tell you you’re right. It is overall very conservative – you know it’s stratified as you might expect – certainly in different industries and different sizes of company and all of that. The idea of standing up a website or an e-commerce site or a publishing site or a new magazine, even a print magazine – even in the mid ‘90s to late ‘90s that was a hugely expensive proposition. Today with technology where it is, it’s just not anymore. So what I see is, that the risk of actually standing something up is much less, but the perception of risk is really, really high, and that’s where that conservative nature really comes into play – because of where the job market has been over the last five to 10 years here in the States.
MJ: I agree. I wonder if just to spin this from the advertising side of things, so where CMOs have traditionally put their buckets of money. Obviously the advertising side’s coming off in terms of top line spending. But one of the great things again at a higher level that has really, I think, appealed to CMOs is they know what they’re buying. Like I’m buying a TVC that’s going to be in these places, and it’s a concrete thing. When you come to some of these campaigns, or maybe strategy – if you want to call it – around publishing as a brand, it’s actually less defined.
I’m having to create it myself, I’m having to do something that’s uniquely tailored to my culture, to our customers, it’s perhaps more fluid, it’s less of an off-the-shelf tick; I’ll have this, this, this and this. Do you think that’s an inhibitor to the growth?
RR: Sure, well it’s the known versus the unknown right? Because you can blast right through that argument. But when you hear a CMO say: Half the marketing I’m going to buy through an ad spend is going to be unmeasurable in brand, but at least I know that. They understand that they’re going to be halfway in the dark.
MJ: I know that I’m wasting 50 per cent, yeah.
RR: Yeah exactly, right, and so the idea of actually taking the time and investment to build a platform to aggregate our own audience – Look at Marriott, it’s now launched an entire studio to build content, long form and short form content. They’re bringing it all in house, they’re building a creative team, they’re building a media team to promote it, they’re building magazine editors, and they’re building a television studio and they’re taking it very seriously, to build in content as a skill-set, as a function in their business to actually launch something that’s going to position them – quite frankly – as a world-leading travel and leisure publisher.
MJ: That’s the Red Bull strategy.
RR: Yeah, that’s exactly right, it is the Red Bull strategy. And the thing is, you look at Red Bull, and people ask me all the time why they hear about it everywhere. Red Bull, Red Bull, it’s all about Red Bull and content marketing, and people ask me: Well why do they do that? It’s because they spend 30 per cent of their revenue, they spend in marketing, and a half of that they spend in content. So they’re actually a very small player when it comes to television and traditional ad buys, but a very huge player when it comes to content with their media studio and what they do with Red Bulletin, which is a published magazine, and then they have the television studio where they’re producing full long form television series, they’re producing a feature length movie, they’re producing all kinds of websites and contents and guys jumping out of spaceships and all that stuff.
Red Bull is actually a media company that also happens to sell a soft drink. The interesting thing to me is that they could sell anything they want now. If the soft drink business goes south tomorrow, they could sell surfboards or a fashion line or skateboards or sporting goods, they could really sell anything they want because they’ve created such a strong emotional brand with a bought in audience. They’ve got permission to sell just about anything they want to.
MJ: I’m aware of our time, maybe just to close it out, the extension of the thought from what you’re sort of saying there is – how do we measure the value of that? People always talk about measurement, seeing the results, that’s sort of the nirvana of content marketing as we connect the marketing effort to sales. In that kind of environment, how do you do that?
RR: Yeah, and it really depends upon the content’s purpose. So for Kraft, they have a print magazine and an online play as well, their Kraft Food and Family Magazine and the online recipes, where they have three million now opt-in audience members as they call them. For them, it’s a data play, because with three million opt-in subscribers to their content, they have actually better data than any research company they would ever buy it from, and they have first party data that they’re using to actually do programmatic ad buys, they’re making those programmatic ad buys X percent more efficient by using the first party data that they have.
So they’re saving tons of money with more targeted regular advertising, print, online and television, and they’re saving money on their research costs that their brand managers would normally have to go out and spend to understand what women in Georgia or what women in New York feel about mayonnaise or cheese, et cetera. So for them it’s a complete profit incentive. By the way, the magazine you pay for, it’s actually marketing that pays for itself. So that’s one goal, right. Then you have a goal like Red Bull, which is of course increased awareness and purchase intent for a soft drink, or you might have a B2B content purpose, which is: I want to put higher quality leads into the funnel by creating an education program where I’m actually pulling in and educating people about the approach, differentiated approach, that I take.
You look at HubSpot for example, there’s an inbound marketing company that quite frankly created the entire category of inbound marketing by starting with content. They created the category of marketing by starting with content. And that goes all the way back to our first part of our first question, which is: Why do we do this? Well, we need to understand, what is the purpose of the content we’re trying – what is the business goal we are trying to achieve, and then first look to succeed with the platform and then have it contribute that success to the business.
MJ: I would actually love to keep going now, but we are out of time. Thanks very much for your time and it would be great if we could connect up again in the future and thanks again for being on the CMO show.
RR: Absolutely, thank you so much for having me.
The CMO Show production team
Producer - Nikki Majewski
Design Team Manager - Daniel Marr
Audio Engineering - Jonny McNee
Graphic Design - Chris Gresham-Britt