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The well-known Swedish fashion company H&M enters a new phase. H&M always followed the same route: cheap trendy fashion. Now they enter a new phase. By buying the upcoming Swedish fashion company Fabric Scandinavien (behind brands like Sunday Sun , Cheap Monday . HM enters a new role as a venture capitalist. Before HM had to produce products to get revenues, now (with acquisitions) they have to control the portfolio of stocks.
 
This could be a boring, dangerous and reactive way to go. Before they were forced to lead and forge a path, now they can just look and follow. In the long run, this could be a problem: when you fall back and get satisfied, the world around seems to fade away.
 
The acquisition strategy marks a shift from H&M’s old approach of launching sub brands (or rather sub companies in another category such as COS
 
Where will it end for H&M? Will it become the new PPR ?

By Claes Foxerus. You can find more writing from Claes here.  He’s also the co-founder and editor of The David Report . And, for those of you looking for Swedish Planning connections Claes is the man, he is the co-founder and secretary of the Swedish APG.
 



Posted by Ed Cotton The Planning for Good group on Facebook was created less than 12 hours ago and already 45 people have signed up.

We've had a great responses from planners in the US and UK.

We need more people to join us, but we also need help in the following areas:

1. Suggestions for good people to add to the advisory board- ideally people working for non-profits.

2. We need problems to solve- non-profits who could use 45 brains on a problem.

Any suggestions and ideas please add to the group page.

Thanks to all of you who have already stepped forward, amazing stuff. 

Posted by Ed Cotton Consultants tell agencies that clients need big ideas powerful enough to transform their businesses, but there’s little evidence of these ideas and even fewer benchmarks.

Thankfully, Craig Mawdsley of the UK’s AMV BBDO put together a fantastic paper about the work his agency did for UK grocery giant, Sainsbury’s.

The paper is wonderfully written and brilliantly argued.

Here is a quick summary.

1.    Sainsbury’s appeared to be starting success in the face in 2002- with its Jamie Oliver campaign, although there were strong short-term gains it didn’t translate into long term growth. The chain couldn’t keep its prices competitive and the advertising effect was wearing out.

2.    New leadership came in and made a commitment to lower prices and improve quality. Hired 3,000 new employees (colleagues)

3.    Advertising was refocused around a quality message, a better understanding of the target mindset, led to more effective media targeting. The business grew, but advertising wasn’t responsible for the growth and the growth was not of significant magnitude to deliver the 2.5 billion pounds of extra revenue required to meet targets.

4.    The agency took a look at the core brand idea- “Making Life Taste Better’. It provided good brand linkage for all the media elements, but it was passive. It asked nothing of customers or the colleagues (employees). They needed to create an active business idea.

5.    Defined as:

Business Idea = A growth engine built from insights about how people and business interact, changing a way a business operates

Communications Idea = Integration of communication channels visually and strategically behind a single idea

Advertising Idea = A compelling single media idea

6.    The agency built a business idea out of three components

1.    Food was a part of Sainsbury’s DNA
2.    People went through the motions when they shopped- to demonstrate this- AMV sent a man with a gorilla suit into the store and filmed reactions, no one noticed
3.    People needed some inspiration for their midweek meals that had become routine and regimented.

7.    Business Idea. "Try Something New Today"

The main focus of the idea was to encourage people to try new things. The idea included; in-store sampling, tips on the website, direct mail tips and TV advertising that encouraged people to try something new. The goal became to get people to add one more item to their shopping baskets, this alone could generate an extra 2.5 billion in a few years.

In-store new idea cards became a big driver for trial, in the first 6 months of the campaign 7 million customers tried something new from these cards. These cards were shared and the idea spread by word of mouth. The website was turned into a community environment where people shared these tips and new ideas.

“Try Something New” gave the employees a role. A manager's survey indicated 97% of employees had recommended something new to a customer.

8.    The idea dramatically impacted Sainbury's image. The idea was simple, but had a broad impact. It immediately turned the stores into more interesting places to shop, got consumers more interested in food and shopping and gave the employees a focus.

9.    Results:

-    Weekly transactions rose from 14 million to 16 million
-    The brand became more relevant to families – 3% ahead of the market
-    The brand has returned to No2 market position for the first time since 2003
-    The idea generated an additional 200 million pounds in revenue

Too often marketing and advertising exist on the fringes of business, they are disciplines that aren’t seen as integral or part of what the business does.

This idea is different, it starts at the center of the business and radiates outwards, without real actions from the brand at a store and employee level, it would have been meaningless and ineffective.

Whether this Sainbury's case becomes a blueprint for the future of the agency generated idea or the exception, depends on the answers to these three questions.

1. Can agencies think this big?

2. Will clients let them?

3. Will clients compensate agencies for these ideas?

Thanks to Simon Law



Posted by Ed Cotton Business Week recently conducted a survey amongst senior executives on the topic of innovation. One of the questions struck Influx as being especially interesting; the obstacles to return on investment for innovation.

The barriers aren’t exactly what you expect them to be, for example, clients don’t seem to have a problem generating the ideas, it’s the implementation that’s the issue.

Clients need help in areas beyond the creative generation of the ideas themselves.

Specifically, clients want help in the following areas...

-    Becoming more comfortable with risk
-    Streamlining the internal co-ordination process
-    Identifying the right opportunities
-    Bringing relevant consumer insights to the table

It appears clients want strategy and process, more than creativity a notion that runs counter to the thinking at most communication agencies.