Martin Weigel on the problems of the ad industry. I love the bolded points in particular. Problem-centric is (almost) always better than solution-centric.

I’d suggest that our industry allows its talents to go to waste because:

  • It labours under a far too limiting definition of what it does – namely advertising (it also interprets ‘advertising’ far too narrowly, forgetting the origin of the word means to “turn towards’).
  • It defines itself by output (advertising) not outcome (the building of brands).
  • It confines itself to a sector that has been static for almost 100 years (since the 1920s, advertising has represented about 1 percent of U.S. GDP) and it ignores all the other aspects of company spending that help build brands.
  • It chooses to chase ad-shaped problems (invariably pressing and short-term), rather than searching for growth opportunities which brand building can contribute to.
  • And for the most part it’s still in the business of asset delivery, rather than the building of long-term platforms and systems.

Source: canalside view – What does our talent serve? 

A rising tide lifts all boats. Increasing brand salience drives both penetration and loyalty. But penetration is what drives the growth.

Loyalty and penetration metrics are intrinsically linked.  They reflect the buying propensities of people in the market – propensities that follow the NBD-Dirichlet distribution and Ehrenberg’s law of buying frequencies.  Growth comes from nudging everyone’s propensity up just a little bit.  Because the vast majority of buyers in the market are very light buyers of your brand this nudge in propensities is seen largely amongst this group – a lot go from buying you zero times in the period to buying you once, so your penetration metric moves upwards (as do all other metrics, including attitudes).

Source: Answering critics | Marketing Science

I’ve seen this more times than I wish to remember…

One well-known firm that Mats Alvesson and I studied for our book The Stupidity Paradox (2016) said it employed only the best and the brightest. When these smart new recruits arrived in the office, they expected great intellectual challenges. However, they quickly found themselves working long hours on ‘boring’ and ‘pointless’ routine work. After a few years of dull tasks, they hoped that they’d move on to more interesting things. But this did not happen. As they rose through the ranks, these ambitious young consultants realised that what was most important was not coming up with a well-thought-through solution. It was keeping clients happy with impressive PowerPoint shows. Those who did insist on carefully thinking through their client’s problems often found their ideas unwelcome. If they persisted in using their brains, they were often politely told that the office might not be the place for them.

Source: You don’t have to be stupid to work here, but it helps | Aeon Essays

As Steve Jobs said:

 “When you first start off trying to solve a problem, the first solutions you come up with are very complex, and most people stop there. But if you keep going, and live with the problem and peel more layers of the onion off, you can often times arrive at some very elegant and simple solutions”.

I’d argue in fact that the process in fact goes ‘simplistic -> complex -> simple’… or as as Mencken said “there is always a well-known solution to every human problem — neat, plausible, and wrong”. 

In ecologist Eric Berlow’s TED talk he points out:

We’re discovering in nature that simplicity often lies on the other side of complexity. So for any problem, the more you can zoom out and embrace complexity, the better chance you have of zooming in on the simple details that matter most.”

The careful construction of a problem takes time. It requires breaking it down, synthesising and framing, reflecting and thinking deeply about how it all comes together. Unfortunately this form of strategy – or problem solving – is still uncommon in business; the exception not the norm. More often than not we’re told ‘don’t overcomplicate it’ as soon as we dig past the surface and reveal the underlying complexity. As Jobs says, most people stop here, leaving us stranded on the side of a superficial understanding of the problem and simplistic solutions.

This is a similar dynamic to the pernicious ‘don’t come to me with problems, come with solutions’ argument. This is all well and good for simple problems, but where problems are complex, it is far more value to come back with a great diagnosis; ‘here’s what the problem actually is’. Businesses don’t like problems, but any problem that is truly valuable to solve unlikely has a simple solution.

Complexity economist Brian Arthur describes the deep problem-solving method in a brilliant interview (which can be found here):

“A good scientist says, for instance, in economics, “This is the principal-agent problem, this is a game-theory problem, this is an overlapping-generations problem.” In fact, graduate studies in any of the sciences and economics consist of teaching students thirty to fifty different cognitions until they’ve mastered them. Then they learn to apply that, and later, when they’re working for the World Bank, they can say, “Okay, it’s like a principal-agent problem.” If you get good enough at this, you actually forget the labels and internalize it. You just have an inner feeling. I’m not saying that’s bad. That’s done, and there is an appropriateness to it.

First-rate people are saying something deeper. They wait and they don’t say anything. They go as deep as they can. They’re examining fundamental beliefs and saying, “Well, I could really move this company as a shrink-wrapped application, but it needs a lot of change.” A first-rate person says, “Is that what we need to do? Is that the business anymore? Hasn’t it changed, and aren’t we really going to get into such and such?”
First-rate people go to the root. They don’t just ask what’s appropriate or what appropriate framework can I dig up and impose. They will study the situation from many, many angles and then say fundamentally what really is going on here. They may borrow ideas and cobble together a very different framework.

There are many types of understanding. It may be that there is an overall simple type of understanding where you just say, “Oh, they’ve got an inventory problem here.” Then there is the deeper kind of understanding I just talked about that asks, “What really is the problem here?

Sadly, this is how consultants used to solve problems, before it become commoditised; when there was no ‘best practice’ to fall back on, when there was no knowledge base so frameworks had to be invented – a mode of operation best captured again by Arthur describing his time at McKinsey:

“In America, industry under Alfred P. Sloan’s ideas was reorganizing into profit centers, so this is really what we were selling. To McKinsey’s credit, it didn’t go in there and just reorganize on day one. They went into large companies like Deutsche Bank, or BASF, and they just sat and sat. They didn’t do anything. They just sat and observed and interviewed and observed and thought and went back and observed. It cost plenty to do this, but they were quite patient. This would go on for months until they had what I would now call a complex picture of what was going on. The opposite of that would be to come in with some cognitive picture saying, “You need to be reorganized this or that way.” They actually let a picture emerge, and this wasn’t lost on me. I would now call this an inductive rationality rather than deductive rationality. Rather than laying a framework on top, they simply let the framework emerge”.

This type of problem solving has a name: design. It’s something the US Army has explored in the US Army Field Guide (FM 3-24 Counterinsurgency). When lives at risk, you can’t afford simple-but-wrong approaches:

“When situations do not conform to established frames of reference — when the hardest part of the problem is figuring out what the problem is—planning alone is inadequate and design becomes essential. In these situations, absent a design process to engage the problem’s essential nature, planners default to doctrinal norms; they develop plans based on the familiar rather than an understanding of the real situation. Design provides a means to conceptualize and hypothesize about the underlying causes and dynamics that explain an unfamiliar problem. Design provides a means to gain understanding of a complex problem and insights towards achieving a workable solution.”

Unfortunately this isn’t how most consultants work anymore – they have become planners, not designers. Consultants (including team’s I’ve worked on, that I’ve worked alongside, and that have worked for me) still fall into the trap of writing slides before they have the content; making superficial parallels to problems they’ve solved before; building project timelines that tie them to their initial hypothesis; and caring more about whether their client is ‘bought in’ to the solution than whether they are solving the right problem. As the original article states: “Those who did insist on carefully thinking through their client’s problems often found their ideas unwelcome”.
Finally as I end this rant, I’ll provide at least one diagnosis to why this occurs… Roger Martin (in an interview with Dev Patnaik) puts this problem down to the fact that most people don’t like solving ‘mysteries‘ (and in turn, to the nature of business school education and arguably the entirety of K-12+):

“Roger has a slightly different outlook. It’s not that either businesspeople or designers have a monopoly on good ideas. It’s that there is a vanishingly small number of people who are actually interested in solving mysteries: as few as 10 to 15 percent at traditional strategy firms, a similar number in design firms, and even fewer among most corporations. Most people, whatever their background, are more comfortable reapplying a formula that has worked in the past than at generating new possibilities. They just try to use a template from an existing success, which is the chief reason we see so many copycat products and copycat strategies. We don’t necessarily need more design-minded businesspeople or more business-minded design people. We just need more people ready to take on mysteries.”

If consulting is to rid itself of some of its criticisms and truly add value it needs to re-think it’s problem solving methods; re-think it’s engagement models; and stop de-intellectualising of its people. Perhaps then the internal reality of consulting can start to match the external perception of them as intellectually engaging and rewarding places to work, rather than that described in the original article:

Organisations hire smart people, but then positively encourage them not to use their intelligence. Asking difficult questions or thinking in greater depth is seen as a dangerous waste. Talented employees quickly learn to use their significant intellectual gifts only in the most narrow and myopic ways. Those who learn how to switch off their brains are rewarded.

By avoiding thinking too much, they are able to focus on getting things done. Escaping the kind of uncomfortable questions that thinking brings to light also allows employees to side-step conflict with co-workers. By toeing the corporate line, thoughtless employees get seen as ‘leadership material’ and promoted. Smart people quickly learn that getting ahead means switching off their brains as soon as they step into the office.

Source: You don’t have to be stupid to work here, but it helps | Aeon Essays

The hegemony of science and scientific thought, in the developed world over the last century, is an indicator of the winner of the most recent battle for dominance among systems of inquiry. A belief in the scientific method, as the only and superior valid method of inquiry for describing, explaining, and interceding in the world, is a hallmark of our technological age. Science, as an activity of disciplined inquiry, has often been called the new religion of the contemporary age.

Nelson, Harold G., and Stolterman, Erik. The Design Way : Intentional Change in an Unpredictable World (2). Cambridge, US: The MIT Press, 2012.

To briefly recap, Aggregation Theory is about how business works in a world with zero distribution costs and zero transaction costs; consumers are attracted to an aggregator through the delivery of a superior experience, which attracts modular suppliers, which improves the experience and thus attracts more consumers, and thus more suppliers in the aforementioned virtuous cycle. It is a phenomenon seen across industries including search (Google and web pages), feeds (Facebook and content), shopping (Amazon and retail goods), video (Netflix/YouTube and content creators), transportation (Uber/Didi and drivers), and lodging (Airbnb and rooms, Booking/Expedia and hotels).

Source: Stratechery by Ben Thompson – On the business, strategy, and impact of technology.

These slides are from Martin Weigel at Wieden+Kennedy Amsterdam, who writes a lot of great stuff over at his blog: These are from his slideshare (link below).

They do a fantastic job of illustrating why targeting ‘light buyers’ is the primary route to growth for most brands. Most of this theory is built on Byron Sharp’s work, especially his book, How Brands Grow, which is required reading for any marketer.

The pattern is the NBD-Dirilecht pattern of brand choice. It shows the distribution of a brand’s customer base in terms of ‘loyalty’. This pattern has been found across brands, categories and countries, and illustrates why trying to create ‘passionate loyalty’ is not a great route to growth, nor targeting increased loyalty at all for that matter.