Here at Polestar we love brands and seeing how people go about building them by getting them to stick in our heads. After all that is of course our aim too!
As the creator of iconic adverts for the likes of Levi’s, Lynx and Audi, Sir John Hegarty has certainly entertained over the decades.
Piper Private Equity, a leading PE brand investor, caught John on the back of a fascinating interview in This is Money, a thought-provoking diatribe railing against the innovation-stifling tech giants. In it, he partly blames the stagnating economy on the tech companies for taking far too large a share of advertising spend and not giving enough of the money to the companies that create innovative ads that seek to entertain us. His ultimate message is that brands have become overly reliant on finding and engaging with customers online, and that a breakup of these giants is inevitable.
So, a question to ask ourselves is should be be investing in above the line advertising? Well, it’s horses for courses. On-demand CMO Mehul Garg took Piper through the innovative ‘scientific’ model that he’s built for evaluating the potential for TV advertising, especially useful for first-timers wanting to dip their toes in. For him, the challenge is not providing ROIs, it’s getting senior buy-in. The realisation from his time at brands such as Moonpig, Photobox, Touchnote, and 8fit, is that ‘investing in above the line advertising is not a rational but an emotional decision. Management are naturally sceptical and it takes time to win hearts and minds. In the end, the channel works for some brands and not others – it worked incredibly well for a brand like Moonpig, which is a cheap impulse purchase, but less so for Photobox, where digital marketing works best.’
Piper says that like many businesses, “we have always been hesitant about spending money on above the line. Growing challenger brands with limited budgets, it has never seemed great value for money when compared to other channels. However, this is changing. What once felt like the preserve of the big boys trying to stay relevant, above the line is now littered with innovative start-ups keen to show how they are better and different.”
With digital customer acquisition costs rising, there are clear merits in helping people fall in love with brands away from the screen. Many of Pipers’ brands are using experiential marketing to engage with consumers – Propercorn organising a bike ride around London and wrapping bike seats with branded covers; Frame using graffiti murals around their sites; and Forthglade organising a Great Dog Walk Get Together to promote wellbeing during the winter months through fresh air, exercise and meeting new people.
Why do Piper and its investment focus on brand? For sure it’s fun, but also, because powerful brands drive strong valuations and excellent returns. What can you do with your business to drive that value through brand?
‘Growing brands is an assault. Jesus preached to the masses, not to 18-35 year-old women with an income of 20 shekels.’