David Boyle - Consumer Insight for Futurebook (14th Nov '14) RAW

Thank you for the glowing introduction. Wow, I'm so happy to be here. We talked about this, I think maybe a year ago for the first time, and I just couldn't wait to come do this. It's such an important topic. Insight really can totally transform a business or an organization or a campaign, but all too often it really is just a buzzword. And so this debate is so super important. Let's have it. One of the things I wanted to do to kind of bring this to life a little bit more is to share some examples with you today. I think it will be more fun with some examples, but you've got to promise not to tweet the actual examples. Okay. That was a big no. Go easy on me or I'm going to get in trouble. Okay. And I'm going to use the example to try to tell Four lessons to share. Four lessons that I think I've learned in my time having fun with insight in all these different places. The first, go large or go home. Something about how we prioritize across a portfolio. You guys know more about that challenge than any other industry I've worked in. Good God. Second, about how we can partner with brands or with other talent to grow our brands. There's a really important lesson there from the music industry all around the world. The importance of being global, which I think is super important for you guys. And then finally, a very important lesson about not letting machines take over and remembering that this is about people skills, expertise and creative talent. At the end of the day, how's that going to fit in? Right. So first, the lesson from the music industry on prioritizing across a portfolio. Before we do that, why did we have to prioritize across a portfolio? Well, because the industry became massively troubled when people stopped buying music. And all of a sudden the big hits, the superstars, stopped paying for all the really bad decisions that were made. And so it stopped being okay to just bet on loads of talent, hoping that one would pay off and it would kind of hide the economics of all the bad decisions that you'd made, all the artists that you threw money at, but they really didn't go anywhere. So that was the crisis of the music industry. And at EMI Music, where I was, the rather ruthless decision was taken to stop spending money on new talent for a period while we work out how to do this better and to, in fact, stop gambling, as it basically was at the time. And think of it a little bit more like investing, like making kind of educated guesses rather than just guesses. And Using data and information alongside skills and judgment, which happens in investment as well, rather than just gambling. So we were forced to prioritize across our portfolio when we worked out how to make better bets, how to invest better, so the money started flowing again. I want to give you a couple of non tweetable examples. Yeah, that was another no, that kind of illustrate what that means. And the first is a brand new artist as was at the time. So we had no information, no one had ever heard of the artist before, no one had ever heard the music before. And we researched. We were very, very excited that he was going to be big and mainstream. Very excited. Skills and judgment told us that. Right. We researched the music before it was released to anybody else. And that was not their action. Actually there was a very small group of people who were super passionate about it, but it was a very small group of people. So we totally scaled back the marketing costs. We totally changed the nature of the marketing as a result of that information. And we researched them again and again over the coming 18 months. It took until we got to the point where more and more mainstream people, it was appealing to more and more mainstream people. And so we then released the marketing money and adapted the marketing spend and sure enough, it was a wonderful success. The lesson there being data can help you to plot your course without interfering with your creative vision. But actually it can save you a ton of what would have been wasted money early on and it can help you to really refine what it is that you do. Another example, very similar timing, very similar amount of information on the artist before release, nothing. And this time it was a very different lesson from a similar process. So we played music before release and in this occasion we thought that the artist was going to be very, very niche, hence some of the artwork. Actually we had a problem because very mainstream people were quite excited about the artist right from day one. So we were able to actually increase the marketing budgets and switch the marketing channels to very much more mainstream channels. And sure enough, we found great success, unexpected success with the album on launch. So again, adapting to it. This time the lesson was to go large. So this kind of thing will help you prioritize across the portfolio and invest in the right things. Well, how did we do that? I think very, very, very simple things. That's one of the lessons from today, I think. So we did massive research of our artists and our music. Just pretty cost effective to do a few hundred quid per song. That's all it costs for those case studies, a few hundred quid and for those of you that are skeptical, rightly skeptical, about the role of research can play, let's boil it down to the basics. When you ask people what they think about something, when you play them some music and ask them what they think, or when you show them a book and ask them if they're interested, they're pretty good judges of their actual underlying views. Research can be pretty good if it's done well. This made us in the decision making process around our artists, faster at making decisions that we might already have made. Maybe smarter though, because some of the decisions were a bit different, much more global. I'll come on to that later. And I think really importantly, just much bolder about what we did. I think when research was used, when insight was used as part of the planning process for artists, which was most of the time, by the end, almost every plan, every launch for every artist was different in some way. As a result, either it was a bit bigger than it would have been, we saw one of those, or it was maybe a bit bolder than it would have been because we didn't quite have the confidence. But after the research we did, maybe it was a bit smaller because we tailored the cost and the spend of marketing to better match the real audience demand. Or maybe some releases just fell off the release schedule. Just fell off the release schedule after getting delayed and delayed and delayed. We saved a ton of money that way as well. So really it wasn't about hindering or tampering creative spirit, but it was about helping each artist to find their success, whether that's big or small, instead of throwing money at everything and hoping that something sticks. So that was the portfolio prioritization exercise at emi. And this is one way in which Insight can be incredibly helpful, can and should be. So next power couple. So how partnering with other brands was incredibly important and what role Insight played in that? This is another really big lesson, I think, that the book industry can learn from other industries. The classic from the last few years for me was David Guetta, who did an amazing job at partnering with other brands, other artists, in this case from totally different genres with totally different fan bases, and therefore crossing into their fan base and raising the number of people who are familiar with him and engaged by him. He went from being a relatively household name in France, but a relatively obscure artist in the rest of the world, to suddenly being a household name in most countries in the world. That's a major transition. And in big part it was done because he recognized the benefits of partnering with other brands. In this case other artists to achieve that. So whilst he at the time was not insignificant with his 32 million Facebook fans, the other artists that he collaborated with and who were endorsing him every day had combined Facebook likes of more like 284 million fans. That's quite a big increase in reach, Quite a clever strategy, had quite a big impact. The same lesson also applies to partnering with commercial brands, of course. And in particular he had a question around this potential car deal, this car partnership. The car company wanted some of his brand equity, he quite wanted some of the car companies marketing reach. But is that right for the brand? Is that the right thing to do? So we did some pretty quick research. Within a couple of weeks, we talked to his fans in four really important countries and sure enough, they said that they thought that would actually enhance his brand and not detract from it. And here he is walking down the catwalk with this new car and you might have seen the marketing. He certainly benefited from that as well. So partnerships offer a massive reach and opportunities. They can be informed by data and data can help to make them happen in a way that doesn't in any way compromise your brand. In fact, totally grows your brand. So this is a major lesson, I think, for most media brands and certainly for books. So next, I think this is such a clear lesson that the publishing industry needs to learn, which is the importance of being truly global. When you have a great asset, a great book or a great artist or a great TV show, it's a tragedy to not help people all around the world to discover that. And I'll show you in a minute quite how fragmented it can be and quite how big the opportunities can be. Let me use a BBC example just to show you. Even the biggest brands. Let's take Doctor who. Please don't Tweet that it's 50 years old. Doctor who, what an amazing franchise. Do you think there's anybody working on the Doctor who project who doesn't thoroughly understand the audience? No. Does that not mean we can't find bigger or bolder or new opportunities? Yes, we can. So in particular, we did a world tour of the cast and crew in advance of the latest season. And the research, the boring old research, showed that Korea was a really interesting example, a really interesting opportunity to grow the market for Doctor who. So we were a bit skeptical of that. The business were. Our Korean team was also a little bit skeptical of that. The money's just not there. It's on tv, but people aren't really watching it. I don't know so we say no, no, no, we're convinced, let's do this. So we take the world tour to Korea and sure enough, we sell out the tickets for the world tour. And not just sell out, but Instead of the 4,000 capacity arena that we booked for Thanz, 60,000 fans apply. And sure enough, there's this massive underlying demand. So even for a big brand that we think we really know, data and research and insight can help us to find new markets that are there. Maybe the business model wasn't generating money, maybe the channel it was airing on in this case wasn't promoting it, or maybe the channel was obscure, I don't know what the root cause was. So some business models in the way, which meant we didn't see the opportunity, but the underlying demand was there. And there's a really simple way that for medium or large brands at least you can understand underlying demand. In fact, it's free and it's Google Search trends Google Search Insights and I remember an example when I worked in publishing, not related to anything I was working on, just from the industry and I searched for a mystery and thriller author from one of our competitors, I think, and I looked at the kind of the patterns of which countries that people were searching for this author in and I looked for a couple of other competitive authors and I saw real difference in the maps and I thought this is really interesting. So here's an example I found the other day for two very similar authors, big mystery and thriller authors, big American authors, very similar, I think authors. And this is the map of where the demand is, where the search terms are, where people are interested in this author around the world for author number one. And you notice some pretty striking patterns there, the kind of countries that are colored in versus the ones that are not colored in. So really clear to me why that is the case, where he's being marketed, which publisher, you can probably guess actually which publisher this is by looking at the map and comparing it to lists of publishers offices. Here's a different example from a very, very similar author. And look how different the map is. Put them next to each other to make that a little bit easier. Look at how different similar authors, both American mystery and thriller authors, I would hazard a guess that one of them has been marketed around the world and one of them has not. And I think there's a big difference there. So I would hazard a guess that there is underlying demand for the first author that has not been exploited. So I don't think the publishing industry is anywhere near as global as it should be. I think we're missing out on tons of underlying demand as a result of that. Finally, don't let the machines take over. So is data and algorithms and crazy computers a credible threat to creativity and skills and expertise? You might think not, or I hope you think not. I think not, but some really important people think it might be. So this is. The Harvard Business School published an article. Is there still a role for judgment in decision making? That's pretty scary. Wow. You should read the full article, by the way. It gets even scarier. And there's a great example from chess, I think, which might lead you to that conclusion in 97. So the computer, I think it's IBM's Watson, wasn't it Beat Garry Kasparov, the grandmaster at chess. So finally, this great sport of minds. Enough data, enough computing power can beat the best in the world. It's a terrible lesson for skills, judgment, and expertise. But fortunately, that's not the lesson, because that all changed after we worked out what computers were for. And Garry Kasparov himself then says, just a few years later, this is last year, I think that nowadays teams of humans with computers, with machines, with data be dominated. In fact, even the strongest computer. So when you partner with a machine, when you partner with insight, in our case, you're way better than any algorithm could possibly be and even better than that. And this is why we need to not just have data in our business, but work out how to use it really well. A weak human, not very skilled human, and a machine with a better process for how they work together was far better than a stronger computer alone and better than a stronger human and a machine, if they hadn't quite worked out how to work together. So have data in the organization, have insight, but more importantly, work out how to use it, what role it plays in your life. I'll give, I think, just one more example then of that in action, and we'll turn to perhaps an unlikely endorser of research and insight. Please don't tweet that, because I would worry for my life, but in music, we had consumer segments. I'm sure most of you have consumer segments. We talked them through with this is Snoop Dogg for anyone who's not familiar, or Snoop, or Snoop Lion, I think it might be called now. And because they were meaningful, because they were useful ways of thinking about consumers, he got super engaged by them. And through the meeting, he kept saying, we got to get them gadgeteers, which is one of the consumer segments. He became obsessed by this one segment. We'd shown was an opportunity and was innovating for ways that he could reach this Gadgeteer segment with his music and his apps and his lifestyle brands. So if even he can work out how to partner with data, which is what he's doing there to achieve success. And I think we certainly all can. And there's some important lessons in there for the publishing industry. So go large or go home. Prioritize across the portfolio. Partner with other brands to achieve reach, but do it with data so that you get the right brands and you enhance reputations. Be much more global, please. Or you're missing out on massive demand for your authors that sat out there. And partner with data. But please partner well with data. Use it in the right way in your business and not the wrong way. Thank you.