Hill+Knowlton Strategies

MINDSPACE (Dolan et al., 2010)

+  +  +         #2  Incentives         +  +  +

Incentives can be a powerful tool in harnessing the power of the public – engaging people and motivating behaviour change. The impact of incentives clearly depends upon factors such as type, magnitude and timing of the incentive. In a competitive economic environment brands are increasingly using incentives to attract consumers and stand out from the competition.

The power of incentive

Brands in the service industry – such as high-street banks, mobile phone network providers – are using incentives and rewards to become more attractive to consumers. However, the behavioural economic insight loss aversion is important in order to understand how best to use incentives in marketing. Loss aversion is used to explain that we dislike losses more than we like gains of the equivalent amount. What this means, for example, is human beings feel the loss of losing  £1 more than we feel the elation of being given £1. Therefore, brands that emphasise the money (or reward) that people will lose out on by not taking an action/purchasing can have a more powerful impact and motivation on people’s behaviour, rather than simply highlighting the amount they could be given if purchasing.

Brands in the fast-moving consumer goods industry consistently have to compete for consumer’s attention. Unilever’s Magnum icecream is an example of a brand currently (April 2013) using incentives as a marketing strategy to drive sales and engage consumers. The incentive Magnum is giving consumers is the chance to win a designer handbag worth £800 every day. However, now understanding loss aversion, if Magnum had framed the incentive in a way that consumers feel that they are losing out if they do not purchase, then this could have a more powerful impact on people’s behaviour to drive sales. Although, the type and magnitude of the incentive of a £800 handbag could be significant enough in itself to demand attention from some consumers. Furthermore, people have a habit of over-weighing small probabilities – for example lotteries – and so consumers may over-weigh the small chance of winning the handbag.

Magnum - win a designer handbag everyday

Another example of using incentives to engage a community is ConAgra Foods. In order to increase engagement on it’s Healthy Choice Facebook Page, users who “liked” the brand received a coupon for 75 cents off their next Healthy Choice purchase. ConAgra then coaxed more consumers to join its Facebook page by dangling a “buy one, get one free” coupon offer. In other words, the coupon’s value grew as more consumers joined the page.

However, a fundamental problem with using incentives, is that once an activity (such as buying a Magnum) is associated with external reward (chance to win a handbag), then individuals are less inclined to participate with the activity in the future without further incentives. Furthermore, and worst still, is if a brand fails to deliver on a reward/incentive – an example would be Red Bull’s VIP trip of a lifetime to the Belgium Grand Prix Competition. Red Bull was censured and criticised by the Advertising Standards Authority (ASA) in February 2013 after sending competition winners on a budget trip across three countries, making them share a bed and then sending them home early after they were barred from entering the race’s VIP enclosure.

Incentives - influencing behaviour and engaging consumers

In summary, incentives can be a useful tool to engage people’s behaviour – and the impact of the incentive depends upon type, magnitude and timing. People have a habit of over-weighing small probabilities, meaning competitions can be effective. Losses loom larger than gains, and so framing incentives to consumers in such a way that they feel the loss if they don’t participate can be a powerful communication and marketing tool. However, if brands become associated with external reward/incentive then consumers can be less inclined to participate in the future without these external rewards/incentives.

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This is the first in a series of nine blog posts which takes inspiration from a Cabinet Office commissioned report entitled MINDSPACE. The report sets out nine of the most robust (non-coercive) influences on our behaviour, which is captured in the simple mnemonic MINDSPACE:

MINDSPACE (Dolan et al., 2010)

The vast majority of government public policy aims to change or shape behaviour – changing or shaping behaviour and inspiring or engaging people is often a perquisite of many of the work we do for clients at H+K. “Hard” instruments such as legislation or regulation is the most effective way for policy-makers to compel us to act in certain ways. However, these instruments are not readily available, of course, to PR professionals aiming to change people’s behaviour and attitudes towards detergents, gin, football boots and the like – “hard” approaches are not appropriate. Policy-makers are increasingly turning to less coercive measures, such as incentives and sophisticated communications techniques, to change and shape behaviour. These less coercive approaches, summarised by MINDSPACE, are directly applicable to the work we do in marketing, advertising and communications. My series of posts in the coming months will work through each of the influences outlined in the MINDSPACE framework, giving examples and explaining how the framework is applicable to our industry.

+  +  +         #1  Messenger         +  +  +

The way we respond to information depends greatly on the reactions we have to the source of that information.We are heavily influenced by who communicates information. Whatever our considered judgment about the value of a message, we automatically give it more or less weight according to the messenger. For example, we are often swayed by authority that has associations of expertise: public trust in expert public sector workers like doctors and teachers is much higher than for politicians.

Brands understand the importance of ‘the messenger’ with regard to influencing consumer choices and driving sales. Celebrity brand ambassadors are effective marketing techniques, because who communicates determines the consumer response and engagement to brand messages. Marketing spends are increasing in budget for the celebrity brand ambassador - PepsiCo struck a $50 million deal with Beyonce to be Pepsi’s brand ambassador.

Beyonce - Pepsi Brand Ambassador

Of course there are plenty of notable examples in UK/global brand marketing campaigns, and include Walkers veteran Gary Linekar, Marc Jacobs and Taylor Swift for Diet Coke, and Blackberry and Alicia Keys. However, sometimes brands can get it wrong – Alexander ‘Hooray Henry’ Armstrong was dropped in 2009 after 7 years as Pimms brand ambassador, reportedly for being ‘too posh’.

Brad Pitt - Chanel No. 5

In order to quantify and qualify the use of celebrities in marketing campaigns it is important to evaluate their awareness, appeal, and relevance to a brand’s image and the celebrity’s influence on consumer buying behaviour. Advertisers are using celebrities for voice overs, and public relations + communications agencies understand the importance of influential celebrities to engage and shape behaviour. Harnessing the power of celebrities social media platforms can be a very powerful marketing tool. We saw that this week at H+K in which Ricky Gervais and Stephen Fry’s Twitter accounts generated a huge amount of consumer engagement with a hashtag campaign for our client Aviva.

Post your comments below on which celebrity brand ambassadors you think are the good, the bad and the ugly!

Follow @AndrewPCBarratt

Hello – I’m really pleased to be a contributor for the H+KStrategies UK London Blog. My name is Andrew, and I have recently started at H+K on the graduate scheme. I will write a couple of blog entries about the graduate scheme – students and those starting a career who want the best start to the PR + Communications industry watch this space!

The majority of my posts however will be on behavioural economics. Behavioural economics is delivering very interesting insights and is something I find exciting and topical. As means of an introduction, behavioural economics is somewhat an umbrella term for a range of approaches that seeks to understand and explain the effects social, cognitive and emotional factors have in influencing the choices and (economic) decisions of individuals and institutions.

Behavioural Economics - an umbrella term

Why I find behavioural economics so interesting, and why it is so popular across the advertising, marketing and PR service industry, is that it provides the framework and insights to better understand people and the way people behave. Therefore behavioural economics can be an incredibly useful tool because it can assist in better understanding the ‘public’ and provide the structure in which to devise the most effective strategies to shape and influence conversations.

There are various ways in which social, cognitive and emotional factors influence choices and decisions – such as loss aversion, framing, status quo bias or simply not putting in the mental effort to make the right decision!  Check back here for my blogs, which are going to give a range of examples to show how these different factors and behaviours influence choices and (economic) decisions.

Follow @AndrewPCBarratt

This month’s Golden Globes kicked off awards season with all the glitz, glamour, pomp and ceremony expected of the 70th instalment of this highly anticipated annual event. Hailed as ‘the party before the Oscars’, it’s not only an unrivalled tool for predicting who’ll be recognised at the forthcoming Academy Awards, but is also useful when forecasting the key fashion and beauty trends of awards season and the year ahead. With the BAFTAs coming up next week, I took to predicting which trends are set to stay. 

Splits and Slashes

‘Leg bombing’ made the headlines again this year with the pin-perfect Rosie Huntington-Whiteley, Lea Michele and Eva Longoria paying homage to Angelina Jolie’s infamous pose. This trend also underlines the importance of looking and feeling body beautiful; read Venus and Braun Beauty Therapist Nathalie Eleni’s top tips for red carpet worthy pins on Female First.

Prediction: With the sun set to warm the shores stateside, we’ll be seeing more and more polished pins stepping out and hopefully they’ll be decked out in some statement stilettos and sparkling shimmer.

  Read the rest of this entry »

Fresh from watching the stunning (and stunningly long) part one of The Hobbit movie extravaganza, I am reminded of the lasting power of amazing content. I know every word of the book, so will happily stand online for all the movies — despite the fact that Peter Jackson’s version is way more gory video game than the novels I love.

Brands have been content publishers for even longer than The Hobbit has been around. The first infomercial was broadcast on the radio in 1922. I don’t know what the storyline was, but I’m guessing it was no sequel spawning epic. Yet if I make just one prediction for marketing in 2013, it’s this:
Brand content will compete with top shelf entertainment.

Like most year end predictions, this is of course already happening. And the reason digitally savvy brands put Hollywood levels of talent, craft and love into what they make is because they are competing for the limited attention of the very same people going to the movies, playing the video games, and yes, even reading books. Sticking ads around the entertainment is giving way to being good enough to be the entertainment. Hello Red Bull, Will it Blend, new style advetorials and every Facebook Page actually worth a Like.

What will content marketing look like in one year? We asked a few smart people for their sharable soundbite.

Many thanks to Claire Candler, Johanna Virtanen of Kiosked, Seb Bell and Brendan Hodgson for their views in the clip above. And thanks to our other D2 Content speakers who gave us some excellent Top Tips for Successful Content Marketing and Advice for budding Contentrepreneurs. Happy Holidays everyone and see you in 2013.

While content has been king on the Internet forever, there is no doubt that it is getting an ever increasing amount of attention. (Even if not everyone likes the term.) For me, I love to see brands offer real value in their communications, rather than just pushing out another empty ad slogan. But it requires an honest mindshift for corporations to become Contentrepreneurs. So we asked some of the bright minds at our most recent Demystifying Digital conference, D2 Content, for their insight and advice.

Top Issue or Barrier for Brands: Cultural Change

Alex Hultgren of Ford, Jon Steinberg of BuzzFeed, Steve Webb of Google, Johanna Virtanen of Kiosked

Top Tips for Brands: Take risks. Emotional hooks. Don’t forget about relationships.

Seb Bell of H+K, me, Simon Langford of GE, Johanna Virtanen of Kiosked, Richard Fletcher of the Telegraph.co.uk, Richard Millar of H+K, Jon Steinberg of BuzzFeed, Alex Hultgren of Ford

At our Demystifying Digital conference on content marketing (#HKD2), I spoke about the concept of brands becoming Contentrepreneurs. Taking advantage of the super smart people on our stage that day, we asked them to give us a soundbite worth of advice for clients who want to become Contentrepreneurs. In fast, furious D2 fashion, here are some great tips, including these wise words from Tumblr:

“Have fun. And don’t be afraid.”

Enjoy the video and share your tip below or via tweet.

1. Value Creation.

2. Commitment.

3. “Create Once. Distribute Everywhere.”

Yesterday, I went over to Google for a different kind of APG event. Titled “Dark Arts of Digital: Video Masterclass,” this hands-on session covered the practical principles of YouTube. We all know how important video is in content marketing. And, in the never ending quest to uncover the secrets of what makes something go viral, it’s smart to hear directly from the people that own the data.

The best part of the day was making, uploading and annotating our own video. Unfortunately, we didn’t get to play in the YouTube creator space studio, but I’ve had a tour of it earlier and it is enough to tempt you to into vlogging full time. However, it was the following tips from the YouTube experts that are of most value to our work with brands.

Not surprisingly, Authentic Content (aka a video made specifically for YouTube or online viewing) works best. They listed these five winning categories below: Read the rest of this entry »

One of the joys of attending the WPP Stream unconference is the glorious stew of participants. Agency and brand people join platform executives, hackers, tech media, artists, and entrepreneurs. Among the latter this year were three startups that captured my attention as well as my imagination. While quite different, they are all concerned with digital content — which is one of the big things we help clients with at H+K.

Condition One

This technology company has created an immersive video player that wowed a pretty clued-in crowd when it was shown at the Stream Gadgethon show. Their software takes video that is shot and edited in the usual way and uses the gyroscopes and accelerometers of the iPad / iPhone to let the user swipe or tilt for a different view. While CEO Danfung Dennis, a photojournalist and documentary filmmaker, was motivated by society’s numbness to flat images of war, happier uses for our clients immediately sprang to mind. Watching video online has always been a fairly passive experience, so I love the idea of users being ‘hands-on’ as they experience brand content.

Read the rest of this entry »