ISSUE SEVEN | SPRING ‘11

Sport’s New Frontiers. The Rise and Rise of Mobile. The Ideas Economy. Making Tracks to Korea. Change Rules. Facilitating Health Solutions.

Colin Byrne CEO, EMEA

Amid fanfare the envelopes were opened, and in moments the shape of international sport changed irrevocably. Russia and Qatar succeeded in their respective bids to stage that most ‘western’ of tournaments, the FIFA World Cup. In his perceptive piece, Andrew Ager explores what the opening up of these new frontiers means for sports marketers. Just like on the pitch, there will be winners and losers.

Co-hosting the World Cup in 2002 certainly helped South Korea overcome some isolationist pressures after the sensitivities of the 1990s Asian Financial Crisis. As Weber Shandwick Korea managing director Tyler Kim notes in his piece The Hermit Kingdom Reconnects, this increasingly prosperous country is now reaching out internationally with enthusiasm but its people have some deeply entrenched attitudes that foreign companies need to understand if they are to thrive in the Korean market. The 48 million people of Korea have 45 million mobile phones. Such high levels of penetration are no longer surprising in the age of the smartphone. Charlie MeredithHardy’s feature on the GSMA Mobile World Congress illustrates just how integral to daily life our handheld devices have become – more than 60,000 people

descended on this year’s Congress from around the world, including 2,900 media representatives. Powerful as it is (and I’m often glued to mine!) mobile is just one channel. It’s the quality of an idea and its relevance to the target audience that counts as much as the communications channels you choose. We live in an Ideas Economy and as our chief innovation officer, EMEA Ben Padfield makes clear: change rules. Though sometimes change is harder to come by than others. Low levels of public awareness about how and why healthcare companies give back to society are proving stubbornly immune to improvement. But if football’s premier international tournament can be played in the Middle East at the height of summer, surely anything is possible.

Andrew Ager Deputy Head of Sport, UK

To Boldly Go...
Frank Borman, Commander of Apollo 8, once said, “Exploration is really the essence of the human spirit.” Sport is another essence of human sprit and like Borman back in the Sixties it is now embarking on a journey to new frontiers.
In December those of us in London working on the England 2018 bid watched, surrounded by the great and the good of English football, as FIFA President Seb Blatter read out the names of the hosts for the 2018 and 2022 World Cups - Russia and Qatar. With the opening of those two envelopes the shape of international sport changed forever and the monopoly that the Western world had over the distribution of major sporting properties was finally broken. Russia, already basking in the success of the IOC’s decision to award the city of Sochi the 2014 Winter Olympic Games, now has the opportunity to create a whole new nation of sports fans with the countdown to Russia 2018. Yes, stadiums need to be built, infrastructure needs to be developed and security issues addressed, but hundreds of thousands of foreign fans are set to visit the country for the first time bringing with them credit cards and hard currency whilst millions of Russians are set to experience first-hand one of the world’s most enthralling sporting contests. Hundreds of millions of sports fans around the globe will tune in and see a new modern Russia. International sponsors will invest in reaching previously untapped audiences and domestic sponsor brands will have the first opportunity to play on a global stage. All thanks to a game played by a team of 22 men and that lasts 90 minutes. A similar sporting evolution is taking place in the Middle East. Seb Blatter’s announcement that Qatar will host the 2022 FIFA World Cup might have polarised opinion as to whether or not the nation will be able to host a successful tournament in the height of summer, given the searing daytime temperatures, and whether or not an Islamic country, albeit one with less strict laws than some of its neighbours, can stage a very Westernised international football tournament. But no one can argue that over the last 10 years the entire Middle East region has undergone a sporting transformation.

With the opening of those two envelopes the shape of international sport changed forever.

Dubai now markets itself to the outside world as the ‘undisputed sports capital of the Middle East.’ International governing bodies, brands and tournaments have turned to the region, exploiting the eightfigure investment that the Emirate has invested in sporting and general infrastructure, to create a new home for some of the world’s leading sports events. Dubai now hosts the Desert Classic PGA Golf Tournament, the UIM Class One Powerboat World Championships, the ATP Dubai Tennis Open, the Dubai Sevens Rugby Tournament and the Dubai World Cup horse race to name a few. The Dubai Department of Tourism and Commerce Marketing (DTCM) has successfully leveraged these events, and the associated international awareness they bring, to promote Dubai as the ideal business environment and publicise its 7-star hospitality industry.

Dubai is not the only location in the Middle East that has aggressively looked to sport as a means of generating awareness and attracting investment and corporations. Formula 1 now boasts two races in the region and despite recent political upheaval that has seen the postponement of the first race of the 2011 F1 calendar in Bahrain, the Middle East is still very much the ‘go-to’ destination in sport. And with the organising committee for the Qatar 2022 FIFA World Cup set shortly to break ground on its multistadia construction project, this trend is set to continue.

What does the opening up of these new frontiers mean for sports marketers? Geopolitics Brands wishing to trailblaze in these new regions will look to seek strong assurances from government that their multimillion sponsorship investment will be protected from events such as economic upheaval and regime change. Different cultural attitudes Alcoholic drinks brands, long supporters of many sports, will find resistance to their product offering. A new playbook Sports marketers will have to look to create ways to engage with new audiences, in a manner that is culturally and socially relevant. So in closing, as a proud Englishman working in London, and despite the obvious disappointment that football isn’t “coming home” in 2018, sport is about to embark on a new and exciting journey, and I for one am going along for the ride.

Charlie Meredith-Hardy Account Director, Weber Shandwick Technology, London

Upwardly Mobile.
It’s not every day you find the likes of will.i.am, Kevin Spacey, Queen Rania Al Abdullah of Jordan, Robert Redford and Isabella Rossellini talking technology with the world’s premier mobile telecoms executives. True enough… but then not many industry events are like the GSMA Mobile World Congress.
Run by the GSMA, the organisation that represents the interests of the worldwide mobile communications industry, Mobile World Congress brings together big business and mainstream culture. Mobile is changing the way we do almost everything, and it’s doing it fast. And for four days each February, Mobile World Congress plays host to the mobile visionaries that are changing how we live. For the mobile industry – and increasingly for the technology world as a whole – it’s by far and away the biggest milestone in the calendar. Mobile World Congress pulls in everyone from technology titans, to entertainment royalty. This year alone, there were keynote presentations from 20 CEOs, including AT&T’s Randall Stephenson, Microsoft’s Steve Ballmer, China Mobile chairman Wang Jianzhou, Vittorio Colao of Vodafone and Google’s Eric Schmidt. The impact that mobile has on all audiences is underlined by companies like Twitter providing keynotes to a packed auditorium. The event is also a draw for entertainment stars who recognise the power of mobile, and the annual Global Mobile Awards has recently seen UK celebrities such as Jonathan Ross, Stephen Fry, Michael McIntyre and Duffy perform to the crowd. The sheer scale of Mobile World Congress is staggering, and 2011 was a recordbreaking year. More than 60,000 visitors from 200 countries descended on Barcelona, including over 2,900 media from every corner of the globe, and 1,400 exhibiting companies who between them occupied 58,600 net square metres of exhibition and meeting space. As well as the GSMA, Weber Shandwick represented a host of clients around Mobile World Congress, in the lead up to the show and on-site in Barcelona. What really sets Mobile World Congress apart is the calibre of attendee. In 2011, an astounding 51 per cent held C-level positions, including more than 3,000 CEOs. There are delegates from all possible sectors and vertical markets. Make no mistake, this is where the good and the great of the mobile world get together to do business and make news. It’s hard for businesses to get noticed, that’s the long and short of it. Journalists are bombarded with invites and requests for meetings for weeks leading up to Mobile World Congress. Then once they reach Barcelona, they’re hit with the predictable torrent of press releases.

Analyst firm Wireless Intelligence predicts that there will be six billion mobile connections by the end of 2011.
There is fierce competition for the media spotlight. Even the traditional technology heavy-hitters can no longer expect to get in front of their target media without having some genuine innovation to demonstrate, hard news, a compelling broadcast opportunity or by offering interview time with their most senior executives. Standing out from the crowd requires months of careful planning, strategic use of digital and a watertight media strategy delivered through multiple channels to cut through the noise, as well as a healthy dose of determination. Increasingly companies are turning to the weeks prior to the show to launch their big news and the race to secure journalists for glitzy launch parties on the weekend before the show officially opens starts earlier every year. The opportunities and challenges are also going to intensify. The GSMA has shortlisted Barcelona, Milan, Munich and Paris to become the “Mobile World Capital™” for the five-year period from 2013 to 2017. The winner will not only host the annual Mobile World Congress event, but will also provide academic and business development opportunities, cultural festivals and programmes. 2010 was a major tipping point in mobile communications, with dramatic growth in smartphone sales, mobile services and applications. Analyst firm Wireless Intelligence predicts that there will be six billion mobile connections worldwide by the end of 2011, and smart brands will get more sophisticated in how they take advantage of mobile as a comms platform. The coming year will see mobile users interact more than ever with brands on phones, tablets and other devices using mobile broadband connections. Organisations that understand the nature of mobile and how their audiences use mobile stand to gain ground. Watch this space for upcoming research from Weber Shandwick focused on the increasing utilisation of mobile as a communications channel. Mobile World Congress is no ordinary trade show. And as mobility continues to pervade our everyday lives at breakneck speed and as more and more brands develop and expand mobile services, the marketplace is becoming ever more crowded. A traditional approach to communicating is highly unlikely to be a successful approach. Forewarned is forearmed.

Mobile World Congress 2012 takes place on 27th February–1st March in Barcelona, Spain

Jan-Dirk Kemming Creative Director, Continental Europe

Fiona Noble Vice Chairman, London

The Ideas Economy.
We are living in a time when communication is no longer ruled by the channel you choose to deliver it through but by the power of the idea itself and its relevance to the target audience. Some reading this may think “So what’s new?”, but in a world that is more socially connected than ever, singleminded DM, advertising or PR thinking no longer cuts the mustard.

The voices from fan clubs, organisations and societies that no longer require a person to physically ‘be there’ to be a member can influence and mould how brands act which, in turn, directly impacts customer retention and sales.
Customers with an opinion on a new flavour, promotional offer or brand direction are marketing gold dust and should be listened to. Take X Factor, for example, that launches in the US this year. For the first time ever, fans will be able to cast votes via Facebook rather than a premium rate phone line. Providing an alternative to a profitable revenue stream might seem like marketing madness but this move puts audience experience front and centre. Crowdsourcing is the embodiment of listening and reacting to consumers as if they were the management team and brands that have already taken this ‘bottom-up’ approach have seen the benefit through industry awards and buzz. In 2009, Kelly Mooney and Nita Rollins summarised this transformation from brand management to brand stewardship under the title The Open Brand. Today, rather than relying on scripted communication created by marketers, great creative ideas often include co-creation elements. Take Disney’s recent above the line television campaign; instead of the usual focus on price and Mickey, the adverts capture the reaction of children seen through the lens of their parents’ video camera as they are told they are off to Florida or Paris. Disney has crowdsourced the moment. There is not a single member of a brand’s board more important than the end consumer. If currently you are having a one-way conversation with your audience, it may well be talking about you elsewhere. And talking can turn to shouting. Looking at modern brand communications there are too many examples of companies that have taken the one-way approach for far too long or that have tried to demonstrate the opinion of consumers without actually asking them. In a world that empowers sociability and citizen journalism, it only takes the anger of one to create the opinion of many. In most cases, the opinion of consumers is driven by a few activists that then recruit others. This theory is referenced in James Surowiecki’s book The Wisdom Of Crowds but more common examples include complaints against television and radio shows. Once the complaint has received media traction, the number of complaints goes on to rise rather than fall. This is due in part to the exposure of the issue in the first place but also because consumers generally flock together even if they do not know all the facts. A fan page for a brand can act in exactly the same way. Some consumers that write on walls may not have had any previous experience with the brand but through the opinion of a friend or a news story feel empowered to voice their thoughts and have a medium to do so instantly. So how do brands mitigate against this? How do you create ideas that can be amplified by the community in a positive way? How do you create that two-way dialogue? The key question to constantly ask and challenge ourselves with is, “How do we make our consumers’ lives more fulfilled and rewarding?” This question applies to the shop floor, packaging or any other communications channel. To achieve this, a brand must adopt a ‘bottom-up’ communications strategy and, if possible, involve its audience in the ideas process. This is of course a choice. But those brands that make the right decision will be the ones we are still talking about in ten years’ time, having truly benefited from the ideas economy.

We are all speaking to the same people and what really gets audiences motivated is not how they are spoken to but why. Why them, why you as a brand and why should they care? If the reasons are compelling enough the idea will form its own channels and the target audience will not only receive it but go on to broadcast it further. Sooner or later brands will have to come to terms with the fact that they are no longer in control of their own destiny. Whether it be a campaign, political movement, idea or brand strategy, it is finally true to say that the consumer is always right... and can prove it. This is certainly not a new insight and some brands have survived, and even thrived, for years with their customers acting as unofficial, shadow board members. The voices from fan clubs, organisations and societies that no longer require a person to physically ‘be there’ to be a member can influence and mould how brands act which, in turn, directly impacts customer retention and sales.

Tyler Kim Managing Director, Korea

The Hermit Kingdom Reconnects.
South Korea is an enigma: a global colossus in the automotive, shipbuilding and electronics sector; an innovator and early adopter of the most advanced publicly accessible technologies; and home to a vibrant youth and music culture. Yet to an extent it remains The Hermit Kingdom, a country that few outside either know or really understand.
After effectively closing its doors to the wider world for many years while rebuilding itself from the inside out, there is now an appetite to re-engage. Led by the expansion efforts of its major corporations and a far better connected consumer, a clearer international picture of the country is beginning to take shape. A key element of that picture is Korea’s robust economy. GDP grew by over 6% in 2010. And according to Bank of Korea research published in March 2011, economic activity is maintaining its upward trend, with both retail sales and facilities investment increasing in January; while in February, exports exceeded 2 billion dollars on a daily average basis for the first time ever! Korea is home to an increasingly wealthy 48 million people. It's a complex and quickly evolving market in which a staggering 40 million people are online and in possession of more than 45 million mobile phones. However, it is also a market best approached with great sensitivity. Korea was one of the countries hardest hit by the 1997 Asian Financial Crisis. As some heavily leveraged Korean companies buckled under the pressure, locally based foreign multinationals were accused of siphoning ‘national funds’ to offshore havens when the going got tough. Government and NGO austerity campaigns followed, with little subtlety in their efforts to steer consumers away from buying foreign-owned products and services. Chaos ensued with owners of foreign vehicles threatened, their cars vandalised, gas stations adopting a no-service regime for foreign-made cars and children openly burning foreign products in school playgrounds. Globalisation was okay, it seemed, but only on Korean terms. More than a decade on national pride remains bruised and it doesn’t take much to reignite xenophobic sentiment. Multinational corporations active in Korea must behave accordingly. Deeply entrenched in Koreans’ social psyche is an expectation that foreignowned organisations should demonstrate a tangible and long-term commitment to communities. Effective stakeholder communications is therefore as much about the community as it is the product or service. Corporate responsibility in Korea is a make or break investment, not a nice-tohave. Understanding consumer mentality is essential for businesses in b2c markets. Korean consumers tend to be emotional and passionate about brands and customer care. They are also very sophisticated and demanding about customer service. The expectation is that services will be delivered swiftly by companies prepared to go the extra mile. For example, the installation of the internet, TV, telephone and other utilities after moving to a new home can happen within hours. It would be unthinkable for utility companies to drag their heels. Furthermore, such visits or after-service arrangements are all free. This explains why some companies had a difficult time when entering the Korean market as consumers simply didn't understand why they would charge extra for the afterservice.

Korea is home to an increasingly wealthy 48 million people. It's a complex and quickly evolving market in which a staggering 40 million people are online and in possession of more than 45 million mobile phones.
Companies such as Samsung are willing to undertake home visits even for small problems. While out on a call, engineers are often prepared to fix problems not directly related to the product. Foreign companies need to understand that Korean consumers have these kinds of high expectations. They should also avoid thinking that whatever worked in their home market will inevitably work just as well in Korea. There are major differences in how communications channels are used. For instance, Twitter is not used by many Korean companies because it is seen as an after-service channel. Consumers will use companies’ Twitter accounts to make requests or complain about a product or service. If companies do not respond immediately to such requests, disappointed consumers will quickly lose interest. Although social media is gaining in importance, traditional media still wields wide influence. Korean reporters play a key role in shaping consumers’ and government’s perceptions of companies/brands. Journalists are highly respected and sometimes even feared by executives and government officials. It's important for foreign companies and executives to show reporters respect when dealing with them. Korean reporters also have a very nationalistic attitude. Many feel that they are the country’s gatekeepers and have an obligation to protect Korean companies against foreign companies. This is especially true for broadcast media and minor publications. It is also common for editorial reporters to encourage companies to advertise in their publications. While trading with the rest of the world as never before, Korea remains wary of foreign businesses. In order to thrive here, organisations must understand the cultural dynamics of the country as well as the commercial opportunities.

Ben Padfield Chief Innovation Officer, EMEA

Change Rules.
The revolution in communications, driven by digital technology, has had as profound an effect on the way the world behaves as the invention of the printing press had on mass literacy 600 years ago. Today’s revolution however, is breeding the hyper-literate... the ability to consume and produce vast quantities of information at break-neck speed and imparting unprecedented influence on anyone who cares to click. The world has changed. We must change too. Fact.
Revolutions have come and gone before, so why now do we stand upon our industry’s crossroads? Imagine this. Today and tomorrow, we as a world will produce more information than we did from the dawn of time through to 20031. Let me contextualise that. In 2010 we produced 1.2 zettabytes of digital information2 (that’s over one trillion gigabytes) – equivalent to 75 billion fully-loaded iPads or the 6 billion people on Earth “Tweeting” continuously for 100 years. 70% is created by people like you and I, and at the current rate it will be 35 times larger in just 10 years. This is rampant revolution, and it’s here to stay. The producers and consumers of this content are now more empowered than ever before. Influence has been democratised and conversational communications is all the rage. Bluntly, PR is the best friend that all within the marketing industry crave. Our discipline has never been so relevant. But never before have more people believed they can do what we do. So what? Well, the lines have blurred to such a degree that we no longer own the right to sell our heritage of “influencer” or “conversation”. Instead we are in danger of being pigeon-holed as the media people, usurped by the under-pressurebut-rapidly-diversifying integrated agencies seeking to own the overall conversational idea. The irony, given our specialism, is this. We, who had mastered the art of changing others’ minds, now have to make up our own minds over how to change. The question is, what do we have to change? What we do, or what we sell? Monetise the hours that go in, or value the ideas that come out? Has our discipline changed, or has the world changed the way it should be applied? Most crucially, do we have to change what we are, or how we think? All warrant reflection. But there are three fundamental drivers toward our necessity to change: 1. Our right to own the conversational idea is being challenged. 2. Our clients need these types of ideas more than ever, but they need more from less. 3. Our commercial model has never been so under pressure. So what are we going to do? Our innovation agenda has a simple, singleminded mission – we design, construct, produce and licence Ideas That Grow. Ideas shaped to become the creative beacons they were designed to be; that grow our clients’ businesses, our own revenue and profit, our reputation, attraction to talent and ultimately our collective pride in the work we do and the purpose we have. These ideas will not be given away as disposable commodities, pawns in the equation of securing activation budgets. They will be carefully constructed to guarantee value and then protected to ensure we retain rights to them. They will be taken to clients as joint venture opportunities... opportunities as powerful for their marketing impact as they are commercially explosive. Explosive through their multiple revenue streams and nurtured through their treatment as assets rather than ideas. Assets that generate a return once in-market with client and agency alike sharing the resultant revenue.

Today and tomorrow, we as a world will produce more information than we did from the dawn of time through to 2003.
Revenue that can underwrite marketing campaigns and make them near-costneutral once amortised. Tell me a CMO that wouldn’t like a high impact marketing campaign that paid for itself. Tell me an agency that wouldn’t welcome new, diversified revenue streams that sit alongside its core business. Well that’s the opportunity we have. To be the agency that monetised marketing. To partner with clients who understand that commerce and communications can co-habit. To continue what we are great at, but now make this prowess pay while we sleep. That’s the opportunity we have and that’s a glorious future for our industry (or those bold enough to jump on board). This is our journey toward innovation. It’s an important one. It’s a journey down a path not previously trodden, but one that must be navigated to secure our position as a leader in the new world order. A journey to the future of our industry. Our choices must be clear though. We don’t have to change what we do but how we think. We don’t have to change our core business but the ambition at our core. We don't have to throw away what we've always done but do more of what we don't currently do. Most importantly, we don’t have to imagine a daunting new world. We have to dare to be more imaginative in our current one.
1 2

source: Google, 2010 source: EMC / IDC study, 2010

Brian Tjugum Head of Public Health & Social Impact, Europe

Do-Good Duos.
The head of communications at GlaxoSmithKline recently lamented about the low levels of public awareness of why and how healthcare companies deliver back to society. This is frustrating. Why do we not appreciate the contributions healthcare companies make to improve our lives and welfare and the positive correlations between good health and happiness, health and wellness, health and prosperity? In typical PR fashion, we must convert challenges into opportunities, at the heart of which lies the potential for powerful partnerships.
Weber Shandwick’s Social Impact practice recently conducted a survey of 200 corporate executives in companies with responsibility for social responsibility or community relations. The key finding: having an impact on critical issues is the number one reason why corporations invest in such activities. A second reason given for funding CSR is the opportunity to see an organisation’s values in action. Interestingly, these outranked businessoriented motivations, such as building customer loyalty and differentiating the company from competitors. The survey also asked executives about their work with NGOs. Sixty per cent said they fund nonprofits, viewing them as ideal partners because they make CSR investments more effective, provide a critical infrastructure, contribute expertise and help engage consumers. The implication here is that corporations want to be active, substantive partners in addressing social issues. Nonprofits, consumers and advocates have an opportunity to leverage and help direct resources and expertise from the private sector to make a meaningful impact. Moreover, nonprofits will be vital to CSR in the years ahead, as corporations intensify their efforts on social issues. The real opportunity for both sectors is to build

‘When looked at strategically, corporate social responsibility can become a source of tremendous social progress, as the business applies its considerable resources, expertise, and insights to activities that benefit society’ Michael Porter & Mark Kramer
partnerships that create knowledge that can be shared across industry to maximise the impact of CSR. And in the UK, these insights must be considered in the context of a possible Big Society. Does this Conservative flagship policy concept compel us to reconsider how we approach these partnerships here? This feels like a moment – that at no other time in history can the private, public and third sectors work together to meet health and social challenges head on. Why develop strategic partnerships in health? First, the obvious attraction: shared financing brings shared commitment – for companies this is a sound investment that can be illustrated to shareholders, and for healthcare providers this could mean efficient improvements in service delivery. Private sector involvement often brings with it innovation that long-standing habit in nonprofits can stifle. We can look to the Global Fund for AIDS, Tuberculosis and Malaria and the GAVI Alliance for childhood immunisation as international examples of where private initiative and an understanding of market forces have helped to focus efforts of the global health community on the biggest killers in the developing world in alignment with government strategies and needs. Perhaps a less obvious, and yet important, benefit of coming together is the enhanced community support that these partnerships can engender in local situations. Uncertainty upon the longevity of nonprofit programmes can be alleviated by the perceived level of sustainability associated with a recognised third-party such as a pharmaceutical company. Following are five considerations for those exploring greater joint working. Above all, relationships must be based on equal partnership with the shared goal of affecting behaviour change, tackling inequalities, improving access to medicines and reducing long-term costs. 1. Transparency. This plays a crucial role in making partnerships work and holding participants accountable. Disclosure and sharing of information go hand in glove with transparency. 2. Core competencies. Partnerships should be developed in which the core competencies of both parties are valued and leveraged. They must create a shared vision. 3. Results orientation. Both parties should agree to mutually beneficial SMART objectives. Agreement on overall goals and priorities allows the parties to use result-driven steering mechanisms for project management. This allows freedom for innovative and efficient approaches. 4. Communication. This is essential for sustaining the shared vision. The more open the communication channels are the more they are used, the greater the prospects for a sustainable partnership. Map your stakeholders and communicate early and often. 5. Change of mindset. Probably the biggest barrier to effective partnerships is that conventional wisdom doesn’t get challenged. Partnerships are not about ‘pushing product’ although market expansion may be a commercial goal, nor are they about accepting charity, but rather about receiving added value. I suspect that partnerships will thrive in the next 10 years. But it may require a change of corporate strategy – moving from being a provider of medicines to a facilitator of health solutions. And it also means adopting greater willingness to do business differently. The companies that know and appreciate this are doing it already.
Edited version originally published February 2011 in PRWeek

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