As part of the WARC x Ogilvy Image to Impact report, Jorrit DeVries, Global Head of Category Development at Spotify, spoke about how media is changing, B2B brands, and creative impact with audio.
If we look at how marketing has changed over the past 10 years, what are the biggest shifts that you have seen personally in that time?
I'm talking to brands on a regular basis. Fragmentation is one of the things that probably stands out the most. It's fragmentation on the platform side. I mean that in the broadest sense possible - where you can place your ads and reach your audience. But there's also the attention fragmentation of the receiving end – the consumer. So, it's very hard.
If you go back even further - and it's not that I'm that old - but I had a discussion the other day with my parents about how they would go to the neighbour's house to watch TV on a set night in the week. And 80% of the country was watching the same show and that was about it. Fast-forward 40 years, if you talk to younger generations about linear TV, they're like, “Dude, what's up? I watch whatever I want, whenever I want on TikTok or YouTube, etc.”
So, I think the fragmentation on both sides has been the biggest shift - and probably headache - for marketers.
Has brands finding their purpose or creating impact in customers' lives been a major shift, or do you think it has been overblown?
Looking at my career, I don't necessarily view it as an enormous shift. As I've always seen it, the bigger the brand, the more emphasis there is on purpose-driven marketing and knowing how you play a role in society and taking care of all your stakeholders.
These days, marketers are more careful not to be tone deaf to whatever is happening at a given point in time. Whether it's social issues or issues around the pandemic, for example, and how you show up, the imagery you use. So, maybe where previously it was easier to have a sustainability agenda or an impact agenda as a brand, today that's much more fluid. You need to be much more on the ball and make sure that you adapt to the here and now, over and above obviously being a good brand, a good employer and a good participant in society.
The other shift I’ve seen came to my attention when we were doing a white paper with WARC earlier this year. It was specifically focused on B2B and looking at how B2B brands needed to shift because of Covid. One of the interesting things about B2B was always that in-person - such as going to trade shows, going into your accounts, managing your large accounts - is very important. And with Covid, that all went away. So, they made a shift to digital but they also figured out that they needed to start working on their brand as much as B2C brands were already doing. They realised the importance in developing their brand to retain and get talent in the door but also to get ahead of their competition by focusing on the brand and not necessarily on the capability of the product.
When you think of brands and creating impact, do you think the next 10 years will involve more fragmentation with more brands? What do you think the coming shifts will be?
I think there will be more personalisation and greater focus on privacy. If you look at some of the results of public companies where they publicly announced that the changes in, for example, the tracking in iOS devices from an opt-out to an opt-in, really gave them a headache and added some headwinds in their targeting capabilities.
They will adapt to it and the more first-party data you have, the less of an issue it is for you as a brand. But in the shift to first-party data - making sure that you do that in the right way, meaning taking care of your customers, making sure that the data is safe - that will become more and more tailored to the individual. A tailored approach to advertising with the right message for a product or a service that we actually want to hear about in a way that we act that actually resonates with us.
I think that we will see more of that, among a lot of other things, but personalisation is something that people will remember. At Spotify, we also see the impact of audio. We just did a big research study called Sonic Science with a firm, Neuro Insights, where we studied more than 600 peoples' brain activity as they listened to different ads on different platforms. Our research showed that 93% of the brain’s engagement with the content on Spotify is transferred directly into ad engagement.
So, you’ll see a shift in audio becoming part of your marketing mix. Because everything is so visual these days and there are so many ways to consume content within that fragmentation, Spotify is pretty much one of the only platforms where you can be doing something else while you're listening to music or a podcast. If I decide to check my social - whether it's my LinkedIn, Snapchat or Facebook - that's probably moving me away from what I'm doing at that moment.
How will purpose, and the necessity for brands like Spotify to have an impact, change over the next 10 years?
For brands, purpose-driven marketing is much less of a niche than it was before. You can almost see it coming every year knowing that X% of the budget of X brand is going to be this purpose-driven campaign because they do it every year. You see big employers that are under the scrutiny of local legislators, for example, run campaigns on what they do for their workers, whether you get free college or not, whether you get a certain minimum wage or how they show up locally. You see that across all sectors that I think there's a lot of emphasis there. There's a lot of need for it.
I don't think it's only driven by altruistic purposes because I also think there is a definite need to make sure that, in a society with news travelling so fast, and everybody having an opinion on anything at any time, you as a brand also need to make sure that you drive a consistent message about how you respond to that, how you get ahead of that or at least how you think about certain topics.
If you had to rank out of 10 when it comes to proving the effectiveness of creating social impact, how easy would you say it would be - with 10 being incredibly easy and one being really difficult?
I think it's definitely not 10, it's also not one but it's, in essence, brand marketing so how do you prove brand marketing further than the extent of reach and impact and those KPIs? I think this is not linked to sales, nor is it necessarily directly linked to site visits or app downloads or any of these metrics that are easily measured.
But I do think there is enough opportunity to, for example, follow sentiment. Most of the large brands follow social sentiment in an automated way. So, what's happening on Twitter or Facebook or any of these platforms that capture commentary around our company, our brand, and what's the sentiment today, this hour or this week? So, I think that's one way to do it. But still, it's difficult to grasp. We have some parameters to figure out that impact but the hard dollar value is probably very difficult to put back to it.
Does consumers' access to information have any sort of impact on how the brand is positioning itself or how Spotify is going to change how it behaves as a brand to the public?
We're obviously a platform where although there is user-generated content, it's definitely creative content in terms of music and podcasts. The more content you have uploaded on your platform, the more participants you have in this process, and the more rigour you need to have to make sure that that is controlled. Also, from my perspective, as a lead for the brand business on the tech and telco side, it's important to make sure that we communicate those checks and balances to our brand partners so that they know where they will, and will not, show up and make some decisions there.
But I think, in general, what you do see – and you and I see that as consumers as well – that any platform or any brand that has a social presence also has a social team to make sure that individual comments are addressed. And when we talk about personalisation, this is the other side of the coin, where you want to make sure that you keep track of the sentiment. Not only at a macro level and see whether you're tracking up or down, but also at an individual level to make sure that if there are complaints or issues or your brand shows up in a way that you don't agree with, you at least have the opportunity and capabilities to address that.
To what extent do you agree that brands can no longer state they're the best at something and do they now need to illustrate, instead, how they fit into consumers' lives?
With Wrapped, five or six years ago, we actually stumbled onto something which underpins the whole personalisation angle, an approach that got Spotify basically where it is today: True personalisation. Because at some point, every music platform had 60/70 million tracks in their library and we're obviously not the rights holders of this content so, across the board this content is pretty similar. So, how do you set yourself apart and how do you become an actual value for the consumer? And that's true personalisation and Wrapped is, I think, the mother of all personalisation quests every year.
I was watching Jimmy Fallon just when we launched Wrapped on 1 or 2 December, and the first 10 minutes of his monologue was about Wrapped and you saw all these brands lean into Wrapped. You saw a couple of big brands use the Wrapped umbrella to lean into this moment. These two, three weeks in December that everybody is anxious to see: 'did I actually get the gift stuff off my list or is it still number one?' And 'what did I listen to?'
So, I think this has always been true for a brand to make sure that you add purpose value to consumers' lives and I always tried to make the parallel to our tech and telco vertical, where brands are fighting tooth and nail to get consumers to appreciate their 5G proposition but they're essentially selling the same technology. One is the fastest, one is the best, one has the most coverage but as a consumer you think: “How will this improve my life?” And that is clearly not always explained well as only 25, maybe 35%, has made the shift to 5G.
Just because that killer use case is not there yet, we as consumers see my Netflix works and my HBO+ works on my phone and I can do my video chat so, what's the killer app that's going to make me change to a more expensive device and to a more expensive plan? But for the mobile carriers, it's critically important that this happens because otherwise they cannot recoup the investments that they had to make to get the licensing for it and then to roll out this new network.
So, I think it's critical to show the benefits. If you think about classic sales, its features, advantages, benefits, and if you can talk about benefits, you're actually touching somebody in his purpose or in his day-to-day life. I really see this value. It's really improving my day to day so that's why I'm going for this, this brand. And if you keep talking about features, then you're basically talking about 5G – “We have 5G, it's fast and the neighbour has the same thing”.
Is it almost like as a society, we're at the 'sufficing' phase? We've reached that plateau so, what's your next stage?
Yes, so are you moving away from the table stakes or are you still just trying to be part of a topical moment? And I think that's our journey too as a platform to figure out what is the next big thing on the consumer side but also on the advertiser side.
How do we move from a very strong upper mid-funnel partner to advertisers to complementing our partnership with the added value of lower funnel and challenging radio as well as the performance marketers that are currently getting the largest chunk of the market?
We are going on that same journey as any brand for the consumer side. We’re asking ourselves, “How do we improve Wrapped every year to make sure that every single Spotify user around the world sees something for them, has something to look out for, to look forward to? And on the advertising side of our business, how do we make sure that brands keep investing with Spotify and we keep delivering on their ever-changing and increasing expectations of their advertising?
The debate around distinctiveness and differentiation has been in the industry for a while. What's your opinion on the importance of distinction versus differentiation when creating the brand's impact?
I think with anything, you also need to be genuine. And I think you do see when people are trying to balance between different objectives and they are not doing that in a genuine way. This kind of shows in the way they go about it - in their go-to-market, in their campaigns, in their advertising.
I agree with the statement that distinctiveness is important but you also need to make sure you're genuine about it, that you're not just trying to jump on the bandwagon of being purpose-driven but not really feeling it or not really practising it. Or trying not to be tone deaf on a certain subject, but just making a complete blunder in the way you go about it because you haven't thought it through.
And, not that this happens regularly, but I do think that as a brand marketer, if you think about distinctiveness, you also need to be genuine about how to do that. Not necessarily you as a person but what fits the brand and how does it fit the broader story, our journey, where we came from and where we are heading?
And because people have immediate response power, that's going to haunt you because your brand response or engagement will potentially be featured in a tweet or meme. There are enough examples over the last couple of years where huge brands used influencers or certain individuals that they thought fit the brand really well but the outcome or the impact or the execution was just not there.
The instant commenting from every single individual that sees your ad is very powerful because you're going to be featured on channels or in discussions that you hadn't thought about when you were running the campaign. So, I think that's something to be more careful about. Forty years ago, maybe your neighbours would talk among each other about how bad that ad was that they saw when they were watching TV together that one night, but that's about it. Now, you can be a trending topic in seconds.