21 July 2007

QANTAS needs more than a logo makeover.

Reports that Qantas is considering plans to "kill off" the bid red kangaroo logo, serves merely to sensationalise and simplify the debate on the process of rebranding.

Here at DIFFUSION, rebranding is more than just a tweak of the logo or change in the colour palette and if Qantas' latest remodelling of both its first and business class service is anything to go by, brand management is something that Qantas is not good at.

DIFFUSION recently flew business class to Los Angeles (at last on points) and was interested to see if the much lauded makeover by Australian designer Mark Newson has really made an impact.

Now Qantas business class is widely regarded as one of the world's best and sure, the flat seats were Newson's design as was the new Noritake crockery and the Alessi cutlery (even the plastic Alessi knife). But branding is in the detail and this seemed to lack.

The much vaunted Marc Newson designed amenities kit was merely a grey plastic shell box with Newson's signature embossed on the front with some in-flight men's cosmetics thrown in. All of this was in a grey cloth bag that also contained socks, a mask and a toothbrush - none of which fitted in the Mark Newson amenties box.

Nor was there any sign of the also announced Peter Morrissey pyjamas with the smart flying kangaroo logo on the front featured in the full colour campaign the airline had been running.. No, these were for "available on selected routes*" and the Sydney/LA route was obviously not one of them, despite the announcement by Qantas Executive General Manager John Borghetti that the collection would be offered to First and Business customers travelling on Qantas international services from 25 March.

So here goes the lesson. International business is an important part of the company's business and more particularly on the protected and coveted US route.

So with Qantas controlling more than two-thirds of the capacity on direct flights to the United States and now under threat from a new Virgin yet unnamed Australia/US carrier (for which DIFFUSION puts it's hand up to work on), so much so that the airline announced this month it would also be creating a premium economy section to sit alongside the revamped business class and to match Virgin's offering.

It would seem of some import that any brand decisions the airline makes, however small, will have a significant impact on future revenues. Those per kilometre revenues, according to Qantas' last Australian Stock Exchange announcement, rose by 1.6% on international routes this year against a 4.7% increase in revenues per seat.

And for Mark Newson, the company's unofficial "creative director", there are some salient lessons. Either manage the process well enough to know everything a customer wants will go into the amenities kit or make sure that Qantas delivers on the design experience you envisaged. Execution is always core of any re-branding exercise.

The future of the media agency.

DIFFUSION was recently asked by a London based agency to look at how media agencies build new business and access clients.

Here's our response.

Media agencies, like all within their category, need to re-examine how they engage with client’s brands and what their roles are in this process. Increasingly media agencies will need to take more of a stewardship role, rather than continue to adopt what I call the agent or carrier role. They will need to go beyond simple single channel thinking, creative responses and one-dimensional strategy and work more closely with client brands at much higher levels.

Agencies need to build excitement, momentum, loyalty, equity and, most importantly, business for their brands and those of their clients. Agencies will need to look at more complete brand portfolio approaches, where they look to work with clients to develop real brand management strategies that embrace every customer touch point; they need to conceive and develop differentiating ideas (for the most part they create non-differentiating ones); and execute with both creativity and thus daring media planning.

Agencies need to really understand the consumer experience – both how people interact with the brand online and offline – as well as how they consume and define the brands they use – will succeed.

Agencies will need to move beyond the idea of "campaign" or the success of campaigns, replacing this with a series of what I call client interactions or engagements within the development of the brand. They should be using all available data driven insights to inform the development of strategic brand portfolio (media) planning across the wide arc of a customer’s interaction with the brand, rather than those interactions which are linked to limited tactical assignments agencies are used to. Furher, agencies will need to create scaled solutions in specific emerging media channels, rather than continuing to cling to those compensations models that are unscaleable.

Increasingly media agencies must embrace those compensation mechanisms that reward the quality of the idea (and here I don’t just mean the advertising idea but a brand one), rather than simply the media idea itself, its execution and tailoring fees to the needs, circumstances and culture of each individual client, rather than a one-size fits all approach. For example, not charging clients fees upfront for any creative work, or charging only for data analysis. All of this needs to be addressed.

My experience with the now defunct 360 agency here in Sydney demonstrates the need for agencies to break down those internal silo approaches that effectively work against widening new business and start doing what they tell their clients to do, provide true integration rather than simply department-to-department billing in the guise of an integrated model. Silos don’t work simply because they foster inwardness and comfort and neither will the agencies that continue to embrace this. This includes media agencies. Welcome to the network. Where increasingly agencies will work within micro-network models to best meet client needs rather than continue to propound the full-service models, which most people will acknowledge are more puffery than reality.

Finally, media agencies need to concentrate on their chief differentiator – their people. In the end this is how businesses win business.