Eva Lihotzky

How the metaverse is speeding up the customer experience

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How can I use the metaverse for my brand? How will this new digital universe transform the customer experience? And what exactly does the term ‘metaverse’ even mean? Strategy expert Eva Lihotzky provides an overview and four recommendations for action for brands.

It was Neal Stephenson who coined the term ‘metaverse’ in his breakthrough sci-fi novel ‘Snow Crash’ back in 1992. His visionary story is about a pizza delivery guy who, as a hacker, roams an immersive, virtual world by night. Thirty years later, the idea of a three-dimensional, immersive online environment where people interact with each other in real time and can create, buy and sell things is no longer just the stuff of sci-fi novels. The potential of social and commercial interactions in a virtualised setting is huge, and investments in technologies and newly created virtual spaces have increased significantly over the past few years. After all, technologists, companies and investors already believe that the metaverse will become a stage of the future and therefore a huge source of revenue. A study by financial service provider Citigroup confirms this: the possible business potential of virtual worlds is expected to reach up to 13 billion US dollars by the year 2030.

The metaverse – more than just a singular space

But what is the metaverse exactly? As well as 173,000,000 hits, my first Google search brings up various definitions. However, most of them have one thing in common: they understand the term ‘metaverse’ to mean more than just a single technology or end state. Rather, they refer to the convergence of several separate technologies, which in the coming years will all gradually reach market maturity – and therefore pave the way for the Web3 era. As well as the increasing use of blockchain and interactive technologies such as virtual reality (VR), augmented reality (AR) and mixed reality (MR), the focus is on Internet of Things (IoT) applications (such as the use of sensors and network communication solutions), computing technology (like 5G and 6G networks) and cloud computing, artificial intelligence (AI) and gaming technologies.

Virtual spaces are resulting in new meeting places

The smart combination of these technologies can create the experience of an immersive, three-dimensional environment where consumers can interact with one another, with a particular company and with its individual surroundings as if they were together in the same room. In the future, this space can have several attributes. First of all, we can assume that both the physical and the digital-virtual worlds will be integrated into the user experience and merge into one. Secondly, reactions and social interactions are enabled there, meaning that there is an ongoing exchange between the consumers, companies, influencers and their avatars. Thirdly, creativity, product definition and product optimisation will be boundless in the space and, ideally, will also be interoperable between individual spaces, resulting in entirely new contact opportunities, communication channels and business models. Fourthly, virtual spaces are available at all times and can be defined and shaped by the users themselves.

Next-level customer experiences

As a result, real-time communication and personalisation will become an even more important differentiating feature for companies that enter into a dialogue with their consumers in the metaverse. This is why the concept of the customer experience needs to be rethought, extended and the communication and interaction speed of brands needs to be raised to the next level. Because as well as the existing touchpoints that companies continue to use when communicating with their customers, there are now touchpoints in the metaverse or virtual spaces to consider as well. This will lead to many new interaction points that companies should take on board in their brand and communication strategy.

The Hitchhiker’s Guide to Metaverse Experiences

Brands are therefore advised to follow these four recommended courses of action:

  1. Identify metaverse potential and implement a long-term strategy
    Companies should determine the metaverse potential that is relevant for their business and incorporate a metaverse strategy into their existing communication and marketing strategies. These should be flexible enough to allow them to react quickly to ongoing technological advances and, in turn, to respond to changing customer requirements and behaviours.
  2. Incorporate relevant technologies flexibly and successively
    It is the aforementioned technologies that make virtual spaces possible in the first place. However, not all technologies are needed for every use case at the same time. Instead, companies will use different technology combinations at different touchpoints. This makes it all the more important to ensure we have the relevant technologies ready for use and can adapt them to customer behaviour along the customer journey. In the future, a diversified technology architecture that can be flexibly applied to the corresponding requirement will be crucial to a company’s success in the metaverse.
  3. Intensify consumer behaviour and emotions in virtual spaces
    A compelling customer experience will also remain a differentiating factor in the metaverse. This being the case, companies should concentrate on also creating consistent and engrossing experiences in virtual spaces that are able to maximise the benefits of immersivity and interactivity. By skilfully combining the relevant technologies – such as AR, sensors and online and offline combinations – brands can approach their consumers through new angles. They can also enable them to identify with products more through ‘tangible’ storytelling, thereby exerting a positive influence on purchasing behaviour and customer loyalty.
  4. Shift the focus onto trust, authenticity and responsibility
    Trust and security will come even more to the fore when defining the customer experience in these new virtual spaces. This is because it will only then be possible to gain acceptance of the newly created experiences that consumers will have with companies in their respective immersive interactions. The more the lines are blurred between the physical and virtual worlds of the consumers, the more important existing considerations – and concerns – relating to data protection, security, IP protection or accessibility will be. So it is up to companies themselves to take a responsible approach and make their products and services inclusive.

Brave new worlds

Technological advances and the resulting immersive spaces are changing the basis of physical and virtual interactions and the way they function. However, we are still a long way off a final definition of how the metaverse will develop further or which gradual developments and functionalities we can expect to see. Even though some of the technologies and building blocks are already in place, the full implementation of immersive, reactive and continuously expanding virtual worlds will take another few years. This is because many of the required technologies will still need time and remain dependent on the progress of other technologies before their capabilities and potential can be used on a wider scale. And even then, they will gradually develop further and set new benchmarks.

But trying to explain what life in the metaverse will be like in the future and how it will affect companies would be rather like asking someone back in 1990 to describe what would become of the internet one day. Perhaps we should just ask Neal Stephenson? After all, the way he envisaged the direction things would take 30 years later was pretty spot on.

This article first appeared in TWELVE, Serviceplan Group’s magazine for brands, media and communication. In the ninth issue, you will find further inspiring articles, essays and interviews by and with prominent guest authors and renowned experts centred around the magazine’s theme „Speed! The Winning Factor in the Digital Age“. The e-paper is available here: www.serviceplan.com/en/lp/twelve/twelve-2023.

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Serviceplan Group

Brave New World: Three countries – three ways into the metaverse

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The metaverse is one of the most exciting – if not the most exciting – innovations in our high-speed digital world. What prospects do companies in different countries see in this new digital universe? And what opportunities are they already using for their brands? Inspiring and surprising insights from the Netherlands, the UAE and Poland.

The metaverse in the Netherlands: A breeding ground for experimentation

Author: Christiaan van Betuw, Managing Partner / Serviceplan Group Netherlands

The digital era in which we find ourselves is characterised by its speed. From small, technical updates that make our lives easier, to large-scale, impactful transitions. The metaverse inexorably belongs to the latter category: a completely new, digital world with other forms of communication and a more intensive digital experience. It is important for brands to explore, test and learn now. And the Dutch market is the place to be.

This is due to the behaviour of Dutch people. For years we’ve been one of the European leaders in digital development. The digital mindset of the Dutch is impressive. For example, 96% of Dutch households have internet and 87% are online every day. The Dutch are at the top of the table when it comes to using online services, such as internet banking, watching digital TV, shopping, and making online (video) calls. In addition, we are very receptive to – and active in – emerging sectors such as e-sports, (digital/hybrid) events and game development.[1]

In 2021, the Netherlands were characterised by the European Union as a “Strong Innovator” in Europe: a country that scores well above average for its innovation efforts. In the period from 2016 to 2018, almost half of the companies in the Netherlands with more than 10 employees were innovative.[2] The advent of the metaverse has also stimulated and inspired the innovative nature of Dutch companies to push things forward.

In addition to a receptive test group and an innovative workforce, the Netherlands – home to ‘only’ 17 million people – offers a clear market and a relatively cheap environment to experiment with the metaverse. And that is already happening on a large scale.

Dutch brands are pioneering the metaverse

More and more brands are testing the power of communication in the metaverse and offering consumers a unique brand experience. Heineken brought – albeit with a hint of fun-poking irony – the physical and digital world together with the launch of the world’s first virtual beer ‘Heineken Silver’ in Decentraland, as well as in the physical world. In doing so, the brand cleverly uses the Heineken experience in the metaverse, but with the clear message that it is still better to drink a beer in the ‘real’ world.[3]

Dutch fashion brand Barki has launched an NFT design but also makes a physical edition of each NFT. The brand states that this prevents the physical T-shirt from depreciating in value and eventually being thrown away. By linking the physical product to the NFT, it retains its value.[4] The same applies to Subway and Lay’s who, in collaboration with fashion brand XPLCT, developed an eye-catching jacket that made avatars in Decentraland look completely on brand. Five unique NFTs were developed, one of which was auctioned, raising €6,000 in proceeds.

It is striking that a ‘phygital’ approach is still often chosen, where brands experiment within the metaverse but also link the physical world to it at the same time. In the near future, the latter will become less so, partly due to companies that focus on full use of the metaverse, such as Dutch initiative Odyssey, which builds interoperable tools for metaverse users.[5]

A long-term goal for the brand in Web 3.0

At the rate the metaverse is evolving, a sustainable marketing effort – one that builds for the future – is an absolute must. And experimentation is inextricably linked to this. I am sure that in a world where everything is faster and grander than ever before, the marketer who dares to make a plan for 2027 will ultimately work for the brand that shapes the market rather than merely following it. That’s especially true when it comes to building a brand in Web 3.0. Let everything you do now contribute to that snowball that defines this future of the brand. The Netherlands look forward to welcoming you.

[1]     https://longreads.cbs.nl/ict-kennis-en-economie-2021/samenvatting/

[2]     https://longreads.cbs.nl/ict-kennis-en-economie-2021/samenvatting/

[3]      https://www.prnewswire.com/nl/persberichten/heineken-r-silver-breaks-out-of-the-metaverse-877176528.html

[4]    https://fashionunited.nl/nieuws/business/nederlands-label-barki-is-straks-in-winkels-en-in-de-metaverse-te-vinden/2022021152646

[5]     https://www.emerce.nl/nieuws/nederlands-odyssey-vangt-vier-miljoen-uitbouw-metaverse

The UAE – a place of metaverse leadership

Author: Helmi Abdalhadi, House of Gaming Manager / Serviceplan Middle East

I recall a conversation with a friend a few years back when we were discussing cryptocurrencies. He mentioned that withdrawing assets in bits and pieces helped avoid German regulatory tax on the crypto-turned-cash. I remember instantly thinking, especially given my regulatory law education, that it was innovative and risk-averse of the German government to be ahead of new technology by putting these laws in place early. I now live in a part of the world where government activities and initiatives are central to the economy and its industries’ activities. The United Arab Emirates government has taken steps, measures and regulations further than most countries in the world to put itself in a position to both lead Web 3.0 and metaverse conversations, as well as enable its native businesses. However, even before regulations, it has made it part of its DNA.

In the second quarter of 2018, the UAE government announced and launched an initiative that “aims to capitalise on the blockchain technology to transform 50% of government transactions into the blockchain platform by 2021”. The Emirates blockchain strategy had a simple goal: to use the secure technology to be much more efficient in day-to-day activities. By giving each transaction and customer a unique identification number that is part of the blockchain ledger, the government aimed to save 400 million printed documents and 77 million work hours annually, as well as almost $3 billion by 2021.

Regulations usually imply a negative connotation for new technology. This is not the case for the metaverses’ main method of payment – cryptocurrencies – in the UAE. Dubai and Abu Dhabi both passed laws in 2021 and 2022 that make it not only easier to use cryptocurrency to make payments for daily purchases, but also possible for crypto exchanges to operate from and within the two Emirates. According to Reuters, over 30 licences have been issued to crypto exchanges to set up shop – including the biggest of the bunch: FTX, Binance and Kraken. As an example, Binance are currently hiring for over 100 positions in the UAE region.

But being ahead of new technology doesn’t just mean regulating and managing. It is also about enabling and building a healthy ecosystem around the industry.

Dubai recently created a committee whose purpose is to build a metaverse strategy for the Emirate. Whether through commerce and shopping, meeting places and social areas, games or learning environments, the committee announced that it will be supporting 42,000 virtual jobs in order to add $4 billion to the country’s GDP by 2030. Resource allocation towards the virtual world, as well as enabling new businesses are key pillars of the Dubai metaverse committee.

In the meantime, Abu Dhabi has pushed for diversity in the male-dominated industry via its Abu Dhabi investment office. ADIO is making it easier for women to be entrepreneurial in the metaverse and Web 3.0 space by giving them free crypto and metaverse domains. This has proven successful. Over 50% of small to medium businesses in this industry in Abu Dhabi were founded by women.

These laws and initiatives have put the UAE in a place of metaverse leadership. They have not only enabled the growth of related start-ups, but also incentivised legacy brands to get involved. At Serviceplan Middle East, we were approached by our client BMW within the past year with a view to taking advantage of the local Web 3.0 facilitation. We created an NFT project called BMW Museum of Sounds, storing and displaying the roars of retired BMW M engines via NFTs. And we won multiple awards and nominations for our efforts.

Regulating technology is not easy and regions that fail to act usually fall behind – but by pushing regulations and encouraging innovation, the UAE are in no danger of making this mistake.

­The metaverse in Poland

Author: Tomasz Przeździecki, Chief Executive Officer / _game changer

It’s a popular phenomenon that millions of Poles are already into. But do they really know about it? Many years of experience clearly show us that games are the best canvas for developing the metaverse and technology in the form of VR and AR. Back in 2017, we carried out activities for our clients (Subway and Coca Cola) in Minecraft, which we can now classify as metaverse projects. Thank you, Mark Zuckerberg!

The concept of the metaverse is one and the same for all – virtual, open, interactive, 3D worlds where players/users can socialise. However, right now there are dozens of different platforms – Roblox, Decentraland, Wave, Ceek, Zepeto, RECRoom, etc. In a few years’ time, we will be seeing global consolidations. Will Facebook, Amazon, or perhaps a new player be leading the market?

For the past few years, it has been a well-known fact that popular games like Minecraft or Roblox are classified as centralised metaverse platforms.

However, the real, futuristic metaverse using Web 3.0 ideology – based on blockchain tech – is considered decentralised. Right now, the key players among those metaverse platforms are Decentraland and Sandbox. Those are the best platforms within Web 3.0, where you can read, write, create and OWN! Where you can purchase land, build your business and possibly make money. And also where you can create art and sell it. But bear in mind that they are still in their infancy, both globally and locally.

The users of the metaverse originating from games like Roblox, Minecraft or Fortnite are younger, usually between 10 and 20 years old. Those who are aware of Web 3.0 are mainly aged 20+.

However, everyone can refer to themselves as users of the metaverse. We should remember not to look at the metaverse only through the prism of games, as this can be harmful. We think along the lines of: “A game can be a metaverse, but the metaverse does not have to be a game”.

Perspective of a Polish metaverse user

Based on the first Polish report on metaverse users in Poland (conducted by the Gameset gaming and metaverse marketing agency), we know that:

  1. 4.3 million Poles perceive themselves as aware users of the metaverse in Poland.
  2. 7.1 million Poles do not participate in the metaverse but would like to.
  3. 29% of respondents stated that they do not want to be in the metaverse. However, most of them (51%) were between 46 and 66 years old. They consider it a waste of time and prefer other types of leisure activity instead.

Among the most attractive aspects of the metaverse, respondents indicated:

  1. The opportunity to meet with friends (83%)
  2. The chance to meet new people (81%)
  3. The possibility of creating new things in this world such as “clothes, art, games” (81%)
  4. The opportunity to look the way you want to (79%)

The top four metaverse platforms indicated by respondents are games:

Minecraft – 83%
Roblox – 66%
GTA Online – 63%
Fortnite – 63%

Roblox in Poland has over two million monthly active users!

So where is Decentraland or Sandbox? Very much on the sidelines – for the moment! So far, they generate around half a million monthly active users globally. We estimate that only 3% of them are Polish users. In the future, that is likely to change in favour of decentralised platforms (once the awareness and education of blockchain increases).

What about brands in the metaverse?

  • 32% of respondents aged between 10 and 55 years old say they would welcome the presence of brands in the metaverse, while 41% say “it depends”.
  • 47% of respondents say they have discovered new brands or services through the metaverse.
  • 39% say they would be willing to buy an offline product from a brand they have interacted with in the metaverse.
  • 43% of respondents expect their favourite brands to be represented in the virtual world.

To sum this up:
YES – your brand should also be represented in the metaverse!
YES – you need to do this as soon as possible, as long as it’s relatively easy, cheap and there’s no clutter.
YES – your target group is already there and it’s just a matter of months until everything is happening on a much larger scale, but will you be able to afford it by then?

That’s why _game changer was created – because it changes the rules of gaming in marketing and communication and is the answer to marketers’ needs for activities in trending channels.

The kind of world you create for your brand depends mostly on the technology and platform you choose. In Poland and around the world, most activities right now are centred around Roblox, Decentraland and Sandbox, so you’d be well advised to focus on those!

This interview first appeared in TWELVE, Serviceplan Group’s magazine for brands, media and communication. Read more exciting articles, essays and interviews by and with prominent guest authors and renowned experts in the ninth issue under the central theme “Speed! The Winning Factor in the Digital Age“: https://sp-url.com/twelve23-lp-en.

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Alexandra Grimm

Speed is the new normal

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The world seems to be getting more complex by the day. We are being forced to respond faster and faster to avoid missing the boat and to secure our market position. How does a public broadcasting company cope with this ever-changing environment? And how is speed becoming a success factor here? Barbara Evans in conversation with Dr Florian Kumb, Head of Programme Planning at ZDF.

BARBARA EVANS: Are you a fan of speed, Dr Kumb?

FLORIAN KUMB: Absolutely! Whenever something is done under extreme time pressure, the motivation is even greater. Even though speed is not an end in itself, it is essential for success in the dynamic media world. For example, speed is now a central success factor when using new technology and in the development times of programme innovations. A good example of this is the fictional TV show ‘Himmel und Erde’ (Heaven and Earth), which examines the war in Ukraine in five stories, focusing on the political situation in the months that preceded it.

Looking at the other extreme: in which areas do you see speed as being of least importance?

FK: In many areas of journalism in particular, both speed and precision are important. If we change our programming because of breaking news, the information needs to be absolutely accurate. Helping people make sense of events is a real challenge if a situation is not clear. And with investigative journalism, thoroughness is much more important than speed. Leaving aside programming, precision is also the top priority when dealing with compliance issues, budget controlling, etc.

Do you see the speed question as being a short-lived phenomenon or one that is here to stay?

FK: User expectations are changing faster than they used to. And we need to respond to this more quickly with our programming content. Constant change is the new normal. I very much doubt that everything is going to return to easily manageable and stable time frames.

In which areas do you feel the greatest need for speed at ZDF?

FK: There was always a great need for speed when reporting the latest news, so that’s nothing new for us – and our colleagues are experts in dealing with breaking news situations. But there is growing pressure on development times in other programming genres as well. The world is changing so quickly that ideas need to be implemented in less time. However, the need for speed has increased mainly in strategic work and non-linear distribution. To achieve our aim of providing ‘a ZDF for everyone’, we need to be very adaptable and highly dynamic in our actions and reactions.

What exactly is ZDF doing to equip itself for this future?

FK: This might sound strange, but the first thing we need to do is increase the complexity because there are no simple answers to complex challenges. For example, we have brought together three areas – communication, digital media and programme planning – that were all under different management at various points within the hierarchy logic. We defined joint processes and task fields such as 360° planning, brand/design or AI in distribution, for which we are now jointly responsible. This increases the need for coordination and lays bare any conflicts regarding roles and resources. However, we all acknowledge that no one area can solve the problems on its own – for me, this paves the way for a successful working relationship in the future.

Will there be any changes in the way you share data internally?

FK: I’m in favour of a complete democratisation of data and, at the same time, a clear framework that provides guidance in this data jungle. We are currently in the process of making all data available for everyone internally. After all, it’s possible for all of our colleagues to learn from findings about formats outside their scope of responsibility. It’s a real mindset change. Another recent addition is the ZDF KOMPASS – an integral ‘compass’ that allows us to manage all relevant performance indicators relating to usage, quality, impact and acceptance of our public broadcasting programming. This tool sets priorities and helps provide clarity in the complex media world.

Do you use AI? And if so, is it easy to reconcile this with your company’s public broadcasting remit?

FK: AI is of central importance for us, for example in our planning work. We use AI both for the recommendation system in our ZDFmediathek and for linear planning, e.g. ZDFinfo. Here, the machine suggests shows for users to watch next or which shows should be scheduled back-to-back. It’s important for the underlying algorithm to have a public broadcasting character. Our aim is not to make money by tying viewers to us with the same kind of content again and again – we have other aims, such as presenting people with new or unexpected content. The data helps us to find out how we can do that.

What has been your experience so far?

FK: Our first experiences have been very good. The diversity of recommendations in the ZDFmediathek increased substantially – more different programmes are now being recommended than was the case when we curated them manually. Obviously, planners can’t be equally aware of all titles. Using AI in linear programming has been so effective that we are now working on expanding it to other broadcasters and broadcasting streams. Also thanks to AI, ZDFinfo has established itself as the most successful linear information broadcaster by far – including among younger target groups.

What impact does this have on the broadcaster’s programming and brand communication?

FK:It doesn’t have any impact at all on the strategic work regarding content profile, brand communication and the development potential of the broadcasting method. Real people are still responsible for journalistic and creative output. AI ensures that they have enough time, because it relieves a lot of the burden in their operational planning work and distribution.

Do you see any particular opportunities or challenges here for ZDF as a public broadcaster?

FK: There are many areas where we need to find new public broadcasting approaches for digital. Take, for example, the expectations regarding user experience. For this, we need to know people’s exact needs. But this is a challenge if we also want to comply with the highest data protection standards. However, our greatest privilege is to be able to implement ideas and projects irrespective of their short-term commercial viability. At the same time, commercial pressure is especially high at the moment: investment decisions are particularly difficult when costs are rising but our income is staying the same. Especially when the investments only pay off in the long term.

When you are developing new ideas, do you look first and foremost within the German-speaking markets, or do you seek inspiration in concepts and ideas from other countries.

FK: Both, but I can’t understand why there is so much of a focus on the USA in our sector. Smaller markets are much more dynamic, particularly when they have a progressive approach to technology. Personally, I find the Scandinavian, Swiss and Israeli markets really interesting. We are in the process of working together with a Danish start-up that is well on the way to solving one of our data problems relating to diversity.

Do you think that German-speaking countries are getting faster in their decision-making and actions?

FK:Germans are often said to be passionate naysayers. At the same time, we like the image of an inventor type who plays around with lots of different ideas and then comes up with compelling solutions. I think the generational shift in companies is a great opportunity to speed things up. The older generation needs to pass on their traditional ‘engineering virtues’ to the younger generation while allowing them to dictate the pace. ‘Fail fast’ is not a new strategy – that was around during the years of rapid industrial expansion in Germany in the mid-19th century. We need to give this more space again.

Findings published by market research company GfK have shown that companies that act faster are more successful. We conducted our own research project about how companies use real-time data, network between various company areas, individualise communication and content, etc. Here, we found that not enough is happening in around two thirds of companies. What advice would you give to decision-makers about ‘speeding things up’?

FK: It’s necessary and it’s hard going, particularly at the beginning. But it’s less about making radical underlying decisions than having a clear vision and lots of elaborate fine-tuning in processes. There’s no way around it. But once top management has set the ball in motion, employees and managers alike will realise that and things will speed up. My recommendation would be to look first at a small number of the company’s core and supporting processes and subject them to an end-to-end examination – even if this is a complex undertaking. For this, companies need to set up and authorise a small internal project team with good people. But I wouldn’t advise using external consultants for this.

Thank you for talking to us!

This artice first appeared in TWELVE, Serviceplan Group’s magazine for brands, media and communication. In the ninth issue, you will find further inspiring articles, essays and interviews by and with prominent guest authors and renowned experts centred around the magazine’s theme „Speed! The Winning Factor in the Digital Age“. The e-paper is available here: https://sp-url.com/twelve23-lp

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Serviceplan Group

Speed is not an end in itself

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“Particularly for younger generations, forwards is the new up”, says Dr Jens Thiemer, Senior Vice President Customer & Brand BMW at the BMW Group. But how fast do brands these days actually have to be if they want to be among the best – and when should they take their foot off the gas? Wolf Ingomar Faecks, Managing Partner of the Serviceplan Group, sat down for an interview with Dr Jens Thiemer to find out.

WOLF INGOMAR FAECKS: Does the “higher, faster, further” principle still apply today?

JENS THIEMER: Status thinking in society is changing, that is something we are seeing more and more. Particularly for younger generations, forwards is the new up. This means that we are seeing a trend away from social climbers and towards social drivers – who want to give something back to the world and who see themselves as part of a society with a shared sense of purpose. So BMW is no longer just about being the best in the world but also the best for the world. We move people, touch hearts and inspire minds. That is how we see our leading role.

Is the ‘fear of missing out’ – FOMO for short – something that should make me throw caution to the wind in a digitalisation context? 

JT: When it comes to digitalisation, we need to be curious and attentive – but not necessarily cautious or conservative. As much as digitalisation propels us forward, it also creates many rewarding challenges, but, in some cases, risks as well. Hacker attacks, data theft and data misuse reached an all-time high during the coronavirus pandemic. Here at BMW, all data is treated with maximum care and confidentiality. And as far as FOMO is concerned: we encounter new hypes and trends in a digitalisation context on a daily basis. People should always ask themselves why they seem to be suffering from FOMO. What exactly could they be missing out on? Have they already understood it completely? What role does it play for other decisions? And then they should carefully weigh up whether they should join in.

How do you decide if something is just hype or a real trend that needs to be followed?

JT: First of all, we analyse very thoroughly – across all sectors – where a movement stems from, which environment it emerges in and who is the first to latch onto it. Many ‘hypes’ are already eliminated at that point because they don’t align with our company orientation and strategy. If a hype offers potential for a brand, you should see how quickly it develops into a more stable trend and how fast other players jump on the bandwagon. And you shouldn’t be afraid that the trend will break or flop. That can happen. Two years ago, the Clubhouse app was an example of us being active relatively early on here in Germany – simply because the platform had great potential for becoming a trend. Many high-profile personalities were on board from the outset. As we have seen, the trend didn’t last as long as expected or perhaps it just still needs more time. In this case, you have to respond so that you don’t use resources unnecessarily.

Speed is a key success factor today but is it also relevant for the sales model, innovations and customer centricity?

JT: Speed has a certain relevance for our processes because they force us to reduce them to the bare bones and avoid any unnecessary elements. Otherwise, you’re just not fast enough. Perhaps you could weigh up the importance of speed in these processes. With innovations, speed is the key factor for staying ahead of the pack. If you’re fast, you’ll set the pace for an entire industry. In the context of a sales model, speed is also growing in importance from a customer perspective: transactions are required everywhere and customers expect them to be simple, short and smooth. By contrast, customer centricity is initially an attitude that calls for certain conditions and that needs to be fleshed out with data in order to gear processes to them optimally. This is only indirectly related to speed. However, you should not underestimate the mindset shift that needs to take place within a company for it to have genuine customer orientation. This takes time and needs to be put into practice constantly and exemplarily.

What risks and advantages does speed have in a company – and also on the roads?

JT: BMW drivers enjoy putting their foot to the floor every now and then. But only if the situation permits high speeds, of course – and with the aid of all kinds of technically conceivable driver assistance systems. But the fun in driving a BMW is not down to the speed itself – drivers and their passengers also enjoy cruising at moderate speeds. In a company, speed allows you to attain competitive advantages faster than others, but also harbours the risk of being inaccurate and making mistakes. But that’s something you just have to take in your stride.

Is speed one of BMW’s corporate goals?

JT: Speed is not an end in itself. It resonates in everything we do as a matter of course. We speed up our processes, avoid anything unnecessary and set clear priorities. This affects in particular our development process, our innovation speed throughout the entire company and our internal decision-making processes. So with that in mind, our goals can definitely be said to boost speed indirectly.

Does speed conflict with your other company objectives?

JT: These things go hand in hand. Some need to be done very quickly, while others need time to grow. That doesn’t mean they are conflicting, though, but evaluated differently depending on the objective.

What do you see as being the three main things that prevent speed?

JT: Long discussion and decision-making channels. Fundamental risk aversion. People failing to look beyond their immediate surroundings in a bold, reflective way.

How can BMW step up the pace against automotive disruptors like Tesla and Nio that have a D2C sales model?

JT: In the automotive industry, there are now many young, fast companies that are willing to take risks and have hardly any structures in place at all. This allows flexibility and room for experimenting and exploring entirely new ground. BMW is a group that has more than 100 years of experience. Here, decisions sometimes take longer to make but we have demonstrated in the past that these were often the right decisions. And we will stick to this course: long-term, customer-oriented thinking with a technological focus – ‘tech magic’ and ‘human-centric’. However, the competition is continually urging us to be even faster, even more resolute and to make even more of an impact.

Is D2C the only way forward? 

JT: As well as improving the customer experience again, direct sales have many other advantages, of course. In particular the direct access to customers and omnichannel, i.e. the ability to facilitate transactions at any sales touchpoint, digital or physical. As well as this, there is a non-negotiable fixed fair price for products so that customers no longer have to look for discounts and special offers, which is simply no longer feasible for a premium product these days. In this way, we will also reach our ambitious goal of having 25% online sales by 2025. We are doing this together with our strong dealership network, which has been involved in the process from the outset. That is how we want to move forward. But of course even a conventional wholesale model can be optimised digitally. Constantly improving processes and achieving better results are the important factor here.

By claiming not to “do sustainability at BMW” but rather to “make BMW sustainable”, the company has a strong ethos when it comes to sustainability. Does this approach need more speed than before?

JT: First and foremost, this approach needs transparency and trust. Sustainability is an area that requires a lot of substance and even more resoluteness. And it also needs lots of communication and explanation, both internally and externally. Superficiality must be avoided at all costs or you will lose credibility. In many cases, loss of credibility comes from companies communicating too much too quickly and then not being able to deliver on it. This is why it’s much more about honesty than speed. How is a company faring with its sustainability efforts? What have we already done and what have we not been able to do? The ideal here is to do what is technologically possible at any given time. And every now and then, to point to the lofty heights we are aiming for in the future. Our BMW i Vision Circular shows here how wide-ranging and resolute our thinking is when it comes to sustainable and, above all, circular mobility. It conveys our aspiration to be the pioneers in developing a circular economy. We deliberately said: “This is our vision for 2040 and that’s where we are actively headed.” Of course, it stands to reason that we still have to work relatively quickly on sustainable solutions during this journey. Even though the steps there still appear too small, someone needs to take the lead.

Are speedboats useful as pilot projects before the regulatory process is changed?

JT: A speedboat (or small-scale project) is an excellent way to explore changes on a small scale to begin with and gauge the effects. This cuts down on both time and stress. It is much easier to adapt individual parameters far more quickly and to set the slider so that it is suitable for the entire process at the end. However, it needs to go beyond the pilot project stage. I’m a great advocate of scaling and transitioning quickly into full size.

Is the speed just as fast in different verticals? 

JT: No, it’s not. And I find that normal as well. Whoever is faster should run ahead. A simultaneous end-to-end responsibility across all vertical streams will then gradually allow everything to sync up. In this way, we create common reference points and ensure that each stream delivers the right thing at the right time. That is the basis for any real customer orientation: everyone knows automatically what they have to do at any given point in time.

What role does speed play in the new performance marketing agency model tailored specially to BMW?

JT: One of the main reasons for implementing the new performance marketing agency model was definitely to increase the speed with which we engage in relevant communication with our customers and offer them our products and services. By significantly reducing the number of agencies and creating a customised solution for our activities all over Europe, we have improved our options here. The Marcom Engine construct is geared towards inherently holistic performance marketing, which generates genuine business impact in a data-based and customer-centric way and produces the best customer experience in our category. The increasing automation and digitalisation of our work processes will be instrumental in increasing speed. Needless to say, the changeover involves a lot of work and, at the beginning, will actually slow down the pace until the transition to the new set-up is complete. The transformation process – i.e. the changed work processes – also requires more management capacity and time to begin with. But we are already seeing enormous synergy effects and efficiencies and, at the same time, a high level of innovation, which makes our customer communication and interaction faster and better.

What kind of risk management is used here?

JT: This change requires us to operate on two fronts simultaneously. While we are working on the transformation, we are also focusing on our current core processes and ensuring that they continue to work smoothly and that we deliver the same high quality as always. A proper planning process and a well thought-out transition plan ensure that the change will be smooth and that there will be a proper handover. At the same time, this is the best risk management.

Are transformation processes slowing down the sales process?

JT: I have no doubt that they help to initiate transformation processes and organisational adjustments. However, in large corporate groups, this often happens at different times. At all the various levels of sales, people need to be won over, processes changed and the organisational structure optimised. The time offset sometimes causes problems in the system, meaning that the new unknown element has to make room for itself first. Pilot projects or support from individual markets can help here. In many cases, external impetus from new competitors or other sectors is needed to set internal change processes in motion, helping us to evolve and optimise our business. You also need to be able to ride this out if necessary. Of course, this calls for a well coordinated transformation and the right communication within the company.

Thank you for talking to us!

This interview first appeared in TWELVE, Serviceplan Group’s magazine for brands, media and communication. Read more exciting articles, essays and interviews by and with prominent guest authors and renowned experts in the ninth issue under the central theme “Speed! The Winning Factor in the Digital Age“: https://sp-url.com/twelve23-lp-en.

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Eva Lihotzky

THE CHANGING FACE OF ART: HOW DIGITAL TECHNOLOGIES ARE RESHAPING THE ART WORLD

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Gallery owner Johann König on the digital transformation of the art sector, the significance of personal experiences and the allure of art for young target groups. An interview with Eva Simone Lihotzky.

EVA SIMONE LIHOTZKY: Mr König, you are regarded as one of Germany’s leading gallery owners. In recent months, you have designed and implemented a number of digital formats, such as an exhibition called The Artist Is Online together with Anika Meier. The international group exhibition could be seen offline at the KÖNIG GALERIE and online in Decentraland, a virtual world based on blockchain technology. What has been your experience with formats like these?

JOHANN KÖNIG: We are initiating many of these digital formats on www. misa.art with a view to being accessible and removing barriers and thresholds. For instance, in Decentraland – a virtual world based on blockchain technology – we held an online exhibition that ended with an online auction. However, we found that it was very difficult to access and that collectors were finding it difficult to buy an NFT – the underlying process was too complex (editor’s note: non-fungible tokens – NFTs for short – are counterfeit-proof certificates stored on a blockchain, effectively rendering digital artworks unique). As a result, we set up our own marketplace that allows people to pay with credit cards and bank transfers. This makes the market more accessible.

Do you think the art world will hold onto digital platforms like this in future or are they just a passing fad?

JK: No, they’re definitely here to stay. What’s also interesting is the technological possibilities that it opens up. That’s why we are planning to sell fractionalised artworks on www.misa.art as well – so people can buy part of an artwork instead of the whole thing. We believe that this will get far more people interested in art and lead to a greater identification with the market.

In another interview, you say that one of the main functions of the art world is to allow people to experience art more. In the business world, this would be termed ‘customer centricity’. What does the art sector need to do to be more customer- centric in its thinking?

JK: To answer this, I asked myself: “Why don’t people buy art? Or, to put it another way, what reasons are there for not buying art?” We then tried to identify and eliminate these objections one by one. In most cases, it’s because people don’t know the price or aren’t able to determine if the given price is reasonable – or sometimes it’s trivial things like not knowing how much it will cost to transport the artwork home. We resolved all of this with a software that brings all of these factors together

Immersive art experiences are an art form where the audience takes centre stage – just like Turkish-American artist Refik Anadol does with his works. What makes these artists’ work so special?

JK: First of all, I believe that art is always a holistic experience. And that you always need to feel it – not just see it. When you look at Refik Anadol’s art, it’s like being hypnotised: they are always moving and, thanks to AI, always new. That’s why it’s like a kind of meditative performance. He has succeeded in bringing aesthetics and concept together.

Do people who visit an immersive art exhibition have a different connection to art than they might have with traditional exhibitions?

JK: For me, it’s important for all KÖNIG GALERIE exhibitions to be immersive experiences – so we can use a space to let people experience something that they wouldn’t normally be able to. It’s only by offering your visitors an experience money can’t buy that you will make a lasting impression on them. At the same time, I believe that the experience factor in itself is becoming increasingly important. And that, in the age of social media, it’s very important to share the experiences with others, so that they in turn will feel compelled to experience them and will also be in a position to do so.

Do you think there will be more and more collaborations between commercial enterprises and artists in order to create exactly the kind of experiences we are talking about here?

JK: We are getting more and more commissions in this area in particular. This is because companies – or their brands – are not familiar with this kind of thing, don’t understand how the art market works and don’t know what relevant positions there are for specific target groups. We, on the other hand, have plenty of expertise and know what the right artistic position is for any given company. This is definitely an area that is not directly related to our gallery work where we are positioning ourselves to a greater and greater extent. We take a close look at the companies in question and determine what they stand for, what they want to achieve with the artistic collaboration and what target group they are aiming to reach. We also carry out a data-based analysis so that we can find the right position for the right company.

And then when you have your findings, you come together with the artists to create experiences that will make a lasting impression on the companies’ end consumers?

JK: It’s a mixture of things. It needs to be related to the brand and, in some cases, it needs to sell the brand – and of course it also aims to make something possible. But due to the fascination for art among a younger generation – or a wider group of people – we are also noticing that more and more companies are exploring the possibilities offered by art.

Why does art play such a great role among younger generations in particular?

JK: It’s because their own creativity plays a more important role. And because art and their own preferences and niche interests are a lot more accessible these days thanks to the internet and social media.

So you believe that, if companies differentiate themselves through various art collaborations, this could put them higher on the radar of younger generations?

JK: Absolutely! Thank you for talking to us, Mr König.

This artice first appeared in TWELVE, Serviceplan Group’s magazine for brands, media and communication. In the eighth issue, you will find further inspiring articles, essays and interviews by and with prominent guest authors and renowned experts centred around the magazine’s theme “A human-driven future: How humans are shaping the digital world of tomorrow”. The e-paper is available here.

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Serviceplan Group

Our values are kind of guardrail in everyday business life

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The Congregation of the Sisters of Mercy of Saint Vincent de Paul is the sole shareholder of one of the most successful mineral water companies in Germany, Adelholzener Alpenquellen GmbH. The order uses the company’s profits to finance social and charity projects. How compatible are Christian values and business-minded thinking? How do these values shape corporate culture? An interview with Superior General Sister Rosa Maria Dick and Adelholzener Managing Director Stefan Hoechter.

FLORIAN HALLER: Sustainability is one of the most important issues of our time – if not the most important. You might say that sustainability is part of Adelholzener’s DNA. Mr Hoechter, what is sustainable brand management in your view?

STEFAN HOECHTER: We have just completed the first Adelholzener Alpenquellen sustainability report and couldn’t help but notice how much people’s understanding of sustainability has changed. It used to be about how much energy the company needed or where savings could be made. Today, sustainability is defined in much broader terms. It not only includes ecological and economic responsibility but social responsibility too. Within these three areas, we identified our materiality matrix with the relevant areas of responsibility – such as climate protection and energy – and this forms the basis for our sustainability strategy.

How do you practise ecological sus-tainability in your brand management activities?

SH: Sustainability is something we take very seriously indeed. Even though our Active O2 water and parts of our Adelholzener range are distributed throughout Germany, the main focus of our sales is right here in Bavaria. This is also where our advertising is primarily concentrated and where we record our strongest growth. We have also come up with a very future-oriented packaging  – and have a reuse quota of over 80%, which is way above the rest of the sector.

Sustainability and good sales figures aren’t always 100% compatible. Or are they?

SH: It is possible to have sustainable business practices and still be economically viable. We are reinforcing this trend, for example by selling our products in reusable packaging in the region and highlighting this in our advertising. We generally set great store by gearing our brand management firmly towards consumers. Only companies that truly understand consumers and have a certain humility towards them will ultimately be able to develop and market products that are target group-specific and geared towards actual usage situations.

As shareholders, what role does the order play in determining the com-pany’s direction and shaping the corporate culture?

SH: When Sister Rosa Maria took over as Superior General in 2016, it soon became very clear that the values the order stands for are the same ones that are growing in importance at Adelholzener Alpenquellen. The order wanted us to implement these values proactively and in the company’s everyday activities. To begin with, it wasn’t clear whether they could be applied in the same way to a business entity. We embarked on a journey together, a journey with an unknown destination that involved lots of discussions and values workshops. In the end, we actually succeeded in reinterpreting the congregation’s five values for our company and also made them readily understandable for all our employees. We are currently in the process of anchoring these values even more firmly within the company by holding employee training courses. Regardless of the values, the fact that our shareholder is a religious order that invests the company’s profits – after making the operational investments needed to safeguard jobs in the long term – entirely in social projects, is social responsi-bility in its purest form.

Sister Rosa Maria, what made you want to anchor your order’s values in the company as well?

Sr. ROSA MARIA DICK: We formulated he five classic values of the Munich Congregation of the Sisters of Mercy back in 2006, adding a mission based on these values a year later. What prompted this was the fact that more and more Sisters had left active service within the company and were being replaced by lay employees. They did a good job, but we weren’t sure if they had sufficient moral guidance. We felt an obligation to provide this moral guidance and, with this in mind, defined our values clearly – in the form they currently take. In other words, what do I understand by mercy and compassion, or by the value ‘Serving – with one another – for one another’? What does that mean for us as an order, in the hospital run by the order – or at Adelholzener?

What relevance do Christian values have in the modern world?

Sr. RMD: The possibilities that are now being offered by science, technology and the digital revolution know virtually no bounds. And this is precisely why human and Christian values are so important in the modern world. I recently read ‘Digital Ethics’ by Professor Sarah Spiekermann, in which she writes about the importance of human values. These are particularly relevant now because there is a greater danger than ever of our being steamrolled by digital technology. And this technology can no longer be seen as a good thing if it replaces people rather than assisting them. However, there has been a slight change in how these values are experienced these days. This is why I have always believed that it’s important for people to be able to ‘experience’ our five values and feel them within themselves – and our values workshops are set up along these lines as well. For instance, we deal with the following question: what does a value like mercy or compassion mean to me in my personal and professional surroundings?

SH: Our code of values includes the following: “We create and nurture a culture of appreciation. We are cordial, benevolent, trusting and appreciative by conviction. Because this inspires and strengthens us. We respect and appreciate each person and what makes them different. To be able to appreciate other people, I first need to be able to appreciate myself. We maintain this culture of appreciation together so that we can grow, develop and be grateful and happy.” The point about appreciating yourself came from Sister Rosa Maria. If you don’t strengthen yourself, you won’t have the strength to help others. And if you’re feeling run down, you won’t have the energy to live your life. We feel that this values-based training enriches us as a company.

And how are these values put into practice in everyday company life?

Sr. RMD: In every values workshop, I point out once again that values are not something that can be prescribed and then taken “three times a day”. People need to be able to experience values themselves. I need to be familiar with values, understand them, question them and then accept them for myself. Only then can I apply them and pass them on to others.

SH: We are currently in the process of preparing guidelines in which these very values are anchored. My fellow managing directors and I are making every effort to apply these values in our organisation and to make them tangible at all times. Of course, we don’t always succeed. In some areas, this is still quite a challenge, but we have every confidence that we will be able to communicate the values here in the future too.

Sr. RMD: We employ almost 600 people at Adelholzener. Our values are a kind of guardrail when working with all these people in all kinds of situations. They are not a nice-to-have addition or a cherry on top, but are primarily there to help us structure and live our everyday lives. This includes making decisions, finding the right staff, encouraging them and also trying to resolve crises in a way that is in keeping with our values. For instance, if we have to part ways with an employee, how can this be done in a manner that reflects these values?

Quite a challenge for managers, I would imagine…

Sr. RMD: Values are not always all that easy to put into practice. Of course our employees look to their managers but they aren’t infallible either. Values-based work can sometimes mean admitting mistakes and apologising to their staff. Values like ‘appreciating life’, ‘serving – with one another – for one another’ and ‘creating and nurturing a culture of ap-preciation’ can also be conveyed through an apology.

Sister Rosa Maria, has there ever been a situation in which you were forced to choose between church values and economic viability?

Sr. RMD: There was one time we had a very strong season that led to sup-ply bottlenecks. Our management had no choice other than to ask employees to come in to work on Sundays as well. This represented a moral dilemma for me too because Sunday has been a protected day of rest for decades and I was being asked to make a decision on the spot. First of all, management defined what exactly was meant by Sunday work. In this case, it meant that about 75 employees would be working for ten or twelve Sundays at the most – they would work for ten days and have four days off. This was also family-friendly and would go on for no more than half a year. And we saw that it worked! Management could easily have said: “Wake up and get real! Can’t you see that we might go out of business if we can’t keep our customers supplied?” Instead, they were respectful of the Sisters, of Sunday as a day of rest and of our employees at all times. I recall thinking that our management were now better than we were at putting values-based work into practice.

Adelholzener’s profits are channel-led into the charities you support, for example providing additional staff for retirement homes and a new hospital with beds for homeless people, to name just two. Is that something that motivates the people working at the company?

SH: When talking to employees about value-based work, we used to hear questions like: “Okay, but how does that affect forklift drivers?” Even just knowing that the end result of their work is going to help other people motivates them. We sell mineral water, which is a great and healthy product. And, once we have made the necessary investments in our operations, the remaining profits will go to areas where we all know that they will benefit people who really need it. Everything we earn goes to ill or needy people. And that is a satisfying and rewarding feeling.

Would you say that companies with a religious order or church as their shareholder are often so successful because they are focused on a long-term corporate strategy rather than on quarterly figures?

SH: The point about the long-term strategy is certainly true. The congrega-tion takes a more long-term view of business than a stock company would, for example. But, interestingly enough, that doesn’t mean that there is less of a focus on profits. We can sense that the Sisters are involved and are keeping a close eye on our business. And yes, we are earning money – we want to, and we need to as well. But it’s different in our case. We know that the order congregation trusts us and this in turn creates an obligation on our part. I’d be devastated if this mutual trust and appreciation between the order congregation and our management team were to break down for some reason. The mutual appreciation is always there and it commits us to one another.

The order is not only Adelholzener’s sole shareholder but, through the advisory board, is also involved in all business decisions. Do you discuss everything together?

SH: There hasn’t been a single advertisement or product that wasn’t seen and approved by the Sisters before being released. Everything we do also needs to have the blessing of the Sisters and the advisory board.

Are there times when you have to put your foot down, Sister Rosa Maria?

Sr. RMD: Last year, we rejected an advertising slogan that didn’t sit right for us. But then we quickly came up with a new suggestion together that everyone was happy with.

Why have you been a little less reticent about talking about your charity projects in your more recent company communications?

SH: People today want to know everything about how a company creates its products, how it treats its employees and what its attitude towards sustainability is. At the same time, social media are becoming more and more important. Given these trends, we see no reason not to shine a spotlight on the good work we do. Such as letting people know that we are building a lift in a retirement and care home and will be covering all the costs so that resident fees won’t be affected in any way. I think these are the things that people really want to know about. We had also discussed the possibility of having slogans – for example, two of these translate roughly as “Drink for a good cause” or “The power to do good” – and there are a variety of approaches that can be used to communicate this.

These days, very few women join religious orders. What does that mean for your order – and what does it mean for the future of Adelholzener?

Sr. RMD: The order is getting smaller and may even cease to exist one day. But I have no doubt that our mission – to spread mercy and compassion – will remain. We will need this in the future. That is the reason for our values-based work, which I am sure will be continued by other people in some form or other. Our mission as an order is to create opportunities for ourselves and for lay employees to help people who are less fortunate than themselves. There are many young people who are looking for meaning in their lives and, yes, maybe we could be even a little more inventive and create new places for them to come together.

Thank you for talking to us.

This artice first appeared in TWELVE, Serviceplan Group’s magazine for brands, media and communication. In the eighth issue, you will find further inspiring articles, essays and interviews by and with prominent guest authors and renowned experts centred around the magazine’s theme “A human-driven future: How humans are shaping the digital world of tomorrow”. The e-paper is available here.

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Serviceplan Group

In the Future, Stores Need to be More Than Just a Place for Transactions

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We need to give a different kind of welcome to our customers and serve them better while they are in the store. That doesn’t just mean serving them in the sense of: here’s the product, there’s the changing room, off you go. It means keeping the dialogue going and the customer engaged.

Read more
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Serviceplan Group

Be True To Yourself Throughout The Brand Experience

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How do you empower a premium brand for the post-COVID world? And what are the challenges that lie ahead with regard to changing consumer behaviour and preferences? De’Longhi Global CMO Fabrizio Campanella on the right combination of short-term activity and long-term aspects, the art of successful international campaign coordination and the power of emotions.

MATTHIAS BRÜLL: How did De’Longhi manage to navigate through 2020?

FABRIZIO CAMPANELLA: At the beginning it was very important to keep calm. Of course the COVID-19 pandemic required us to take action and change some of the ways we operate, but not to change everything. We always try to keep a long-term perspective, so we decided not to change certain things like our media or marketing investments. Yes, the short-term environment was very challenging, very unpredictable, but we thought both investments were important in the long term. That was our approach in 2020 and it still is in 2021 – to find the right combination of short-term activity and long-term outlook.

Has the fact that people were forced to stay at home had a positive impact on your business?

FC: For many of the categories we are in, the pandemic has had a positive impact because of people spending a lot more time at home. However, this merely accelerated trends that had already emerged prior to COVID. The coffee market was booming before; the coronavirus only accelerated that. We have benefited from the fact that many consumers are used to drinking certain types of coffee specialities that are probably more espresso-oriented when they are out of their homes – but that is not the coffee they drink in their own four walls. At home they might be okay with a simpler, more traditional way of preparing coffee. People not being able to enjoy the out-of-home coffee experience during lockdown is what accelerated the trend for the same kind of coffee at home.

You even increased your marketing investments in 2021. What are the main aspects of this and why?

FC: It’s true that we are increasing our media investment, especially in the second half of the year, but this is a longterm commitment. There are still a lot of countries where we don’t yet have top-of-mind awareness. Not in Germany, of course, but our products are still niche in other countries, so we need to build categories and a loyal consumer base. And it takes time to do that.

You have been working with a global ambassador since the summer. Why is Brad Pitt the right fit for your brand?

FC: If you look at Brad’s awareness, he is the number one across regions from the US to Asia and also across consumer segments. And we were looking for an ambassador who was also strong in terms of their values. I think Brad is a perfect fit for our brand DNA because, like us, he sets great store by quality. He is also very focused on design, which will also become even more important for us in the future.

The campaign with Brad Pitt is your first real global campaign. Why did you wait until 2021?

FC: I think the conditions are right now. We have strong products and the right level of investments and have expanded all markets above a certain threshold, which really allows us to bring them all together on the same communication platform.

Are the markets happy with the campaign and will you stick to that consistency in your communication?

FC: It was relatively easy once the markets were on board. They saw the opportunity with the global ambassador and understood that it wasn’t possible to run this thing independently and that to maximise your opportunity you had to have a coordinated approach. I prefer to talk about coordination rather than centralisation because there’s always a balance. There are things that need to be done and executed locally and decided locally, but in a coordinated framework. We decided to go live on 2 September. That was coordinated. The format of the launch events was somehow consistent, but local markets had the freedom to organise a specific format according to their market reality and business reality. So it’s always a combination of the two. And that’s why I think it’s also the path to take in the future.

Are retail supply chains having an impact for you? Is that posing a problem?

FC: The retail environment has been disrupted in the last few months. So of course there are big swings between one chain or another, online and offline. This was one of the most challenging factors for us: managing the business and adapting to the changing environment. There are some distribution channels that were very relevant in the past but are less relevant today. We have an online explosion in countries like the UK, where 90% of our business is now online. This is a fundamental change to our supply chain because it’s a completely different way of working.

De’Longhi’s brand positioning has been driven by a strong focus on design and technological leadership, the objective of matching people’s needs at home. So people-centricity seems to be a crucial driver of your business. How is that reflected in your organisation and daily work?

FC: Design is important for us, as is technological innovation. We are a company that is very focused on technical improvement, technical innovation and technical excellence in our products. But it is also important – and this is something I am personally pushing – to consider the emotional aspect, which is about consumer-centricity. Yes, consumers need better products from a technology standpoint, but they also need to have a good emotional experience. This is something that now features prominently in our conversations on the marketing side, and the evolution of the product portfolio will also go in that direction.

Is the physical point of sale still the place where you provide your consumer with the full brand experience or have most of them already switched to the digital experience?

FC: Of course the digital experience is becoming fundamental. But I also think that the physical touchpoints will remain important. They will change and the reason for their importance will change too. So these days it is probably less about distribution and more about the experience. But at the end of the day, if you really want to buy a fully automatic coffee or espresso machine for the first time, you need to taste the espresso. That is something you cannot do digitally. Just imagine countries like China: as a market, China is further ahead in terms of digital channels. Everything is digital in China, but if you need to convince the Chinese consumer to buy an espresso machine for the first time, I assume they will need to taste the espresso in the stores first. The whole experience aspect is something that will remain fundamental.

What is your strategy for providing your target audience with the best brand experience?

FC: There are probably three things that are key for me. One is consistency. Be consistent and true to yourself throughout the brand experience. Being relevant is also important – talking to your customers based on what they really need and focusing on the emotional benefits of your brand and your product. So if you’re consistent, if you’re relevant and if you’re warm, you will have all the elements in place to offer the best brand experience.

This article first appeared in TWELVE, Serviceplan Group’s magazine for brands, media and communication. You can read more exciting articles, essays and interviews by and with prominent guest authors and renowned experts in the eighth issue under the central theme “A Human-driven Future: How People Shape the Digital Tomorrow. Click here to access the e-paper.

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Wolf Ingomar Faecks

How the Nowness Economy is Changing the Way We Work

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We want it all and we want it now! During the coronavirus pandemic, people have developed new expectations when it comes to how they want to work. Looking for self-fulfilment and purpose, young generations in particular want both a career and personal well-being. Wolf Ingomar Faecks calls this phenomenon the “Nowness Economy” and advises companies that want to attract top talents in the long term to take on board and implement five key principles.

Creating a Framework for Cooperative Self-Organisation

April 2021 could well be seen as a turning point: the month in which some four million Americans resigned from their jobs – a phenomenon known as ‘the great resignation’. And, according to a study by Microsoft, this could increase in coming months, including outside the USA. This is because an estimated 41% of the global workforce are considering leaving their employer. This approaching wave of resignations can be attributed largely to three reasons:

Firstly, many employees no longer have a connection with their employers. Interpersonal communication has suffered because interaction has dwindled or is now based entirely online, leading many employees to feel that they are not noticed or appreciated.

Secondly, the pandemic has reinforced the employees’ view that they can only learn new skills or take the next step up the career ladder by moving to a new company. They don’t see any (further) opportunities for upskilling or advancement in their own company as things currently stand.

Thirdly, after a year riddled with change, employees are looking for a new direction to take. Rather than simply returning to their old pre-pandemic life, they want to pick up on the positive aspects of recent months and use these as a basis for making lasting changes to their own lifestyle.

These positive attributes include greater flexibility when it comes to their own working times and workflows. Remote work has meant that it’s no longer necessary to spend time travelling to the workplace every day and made it easier to plan working days and strike a healthy balance between family and work obligations. This allows people to concentrate on the things that really matter in their lives.

All of this is giving rise to an intrinsically motivated Nowness Economy. Rather than ‘business as usual’, employees are seeking out life paths that lead to purpose and personal fulfilment. In their career decisions, they are no longer interested in security that comes at the expense of living a full life. This means that they are considerably less willing to sacrifice quality of life in the interests of furthering their career. Instead, they are looking for a way to combine professional growth with personal wellbeing. Employees want to benefit from their newfound freedoms in the here and now; and at the same time, they want to shape the future today while rejecting any compromises that involve being tethered to any one employer.

The way in which companies meet these expectations will determine who will stay, who will go and what new employees are brought on board. Employers should therefore make use of the positive aspects of recent months and learn from the challenges they have been faced with – this will allow them to remain an attractive proposition in the market for top talent, in the long term and under these same conditions.

To capitalise on the zeitgeist of the Nowness Economy in this context, organisations need to take into account five core aspects and implement them:

1. Maximum flexibility rather than old patterns

Rather than ordering the entire workforce back into the office and reverting to old patterns, companies should now establish – if they haven’t already done so – the necessary conditions for flexible working models. Thanks to modern workplace booking systems and agile process management, it is possible to observe fluctuations in how often employees come to the office. This takes into account the individual work-life balances of each employee, while also making it possible to adapt to potential peaks in office capacity. As a result, employees are permitted the necessary freedom, the option of deciding for themselves when they come to the office and when they work from home – or in other words, continuous alignment based on the new requirements of the Nowness Economy.

2. Connecting the physical and digital worlds rather than differentiating between them

These days, the concept of ‘the office’ and employees’ connection to a company go well beyond the office in the physical sense. Accordingly, a cornerstone of the Nowness Economy can be used by managers focusing on transparent communication. Here it is imperative that employees are not only equipped with digital tools but, above all, with a digital infrastructure that enables them to participate in internal and external company discussions wherever they happen to be working. This means that collaboration models also need to be possible via different constellations – regardless of where employees are physically based. Concepts should be developed accordingly, complete with tools and systems that facilitate hybrid situations rather than hampering them. This will boost the team spirit even beyond the physical space, ensuring that all employees are given a voice and that their needs are taken into account.

3. Employer centricity instead of optimised human resources

The talent landscape has shifted and employee expectations have changed. Managers need to take a close look at the individual needs of each group within their company. From initial onboarding to individual career development paths and new work concepts, they should create an environment in which every employee can and wants to deliver their best performance for the company. Essentially, it all comes down to implementing an integral employer experience within the company rather than focusing solely on optimising resource allocation on company-wide projects.

4. Freedom for self-realisation rather than restrictive guidelines

Two core elements of the Nowness Economy are the desire for self-realisation and the need for self-determination. To give due consideration to these aspects, employers need a new organisational outlook: individual employees should be free to choose their own work practices within a given framework. However, this calls for a new concept of leadership – one in which leaders set the general direction and create an environment in which employees organise themselves. In this way, rather than curbing employee motivation, they encourage an ongoing willingness to learn and many ways for employees to contribute.

5. Explicit culture work instead of implicit culture vacuum

Introducing greater freedom and hybrid working models will have a fundamental influence on the organisational culture of the future. It will give rise to a cultural conglomerate that is based less on spontaneity and more on plannability. To lend this the right level of authenticity – and, in turn, get employees interested – companies should work on formats for instigating active cultural change that create the necessary degree of interaction. Environments, possibilities and formats for bringing people together should be initiated for this purpose: this is to provide the effects of the Nowness Economy with the necessary space and to allow the accompanying new cultural identity to develop.

To sum up, the way organisations can meet the new requirements of the Nowness Economy can be determined using five key elements: flexibility, freedom, hybrid working forms, employee-centric organisational forms and active culture work. This is the only way to achieve ‘mass uniqueness’ as opposed to ‘mass standardisation’ – and to ensure that the working environment allows employees to pursue their own self-realisation goals.

It is probably safe to say that we will not be returning to a pre-pandemic state of affairs – or at least that we should not aspire to do so. This is because new employee needs will force organisations to move away from old standards and give employees a new freedom to act as they see fit. Away from rigid company guidelines like fixed working hours and office attendance and towards flexible working times and hybrid working concepts. Only in this way will employees be able to help define their working environment wherever they happen to be and in the context of their day-to-day lives – and also play their part in shaping the future today.

This article first appeared in TWELVE, the Serviceplan Group’s magazine for brands, media and communication. You can read more exciting articles, essays and interviews by and with prominent guest authors and renowned experts in the eighth issue under the central theme “A Human-driven Future: How People Shape the Digital Tomorrow. Click here to access the e-paper.

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Serviceplan Group

A Future Role of Technology in Customer Experience

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Organisations have come to realise that, in an age where everything is available to everyone, customer centricity is key and experience has become the X factor. The focus is on technology, with artificially intelligent algorithms and new interfaces to meet the needs of the customer. But how can we ensure that we don’t “just digitise” and that people and their needs remain in the foreground? An analysis by customer centricity and artificial intelligence expert Nancy Rademaker.

In our current digital world, keeping the human at the centre of everything is a big challenge for most organisations. Living up to the ever-increasing expectations of the customer is not always easy to do and will require continuous investments and adaptations. Even though technology can act as a huge enabler to deliver the utmost convenience, transparency and personalisation, how can we make sure we don’t “just digitalise”, but keep the true human connection as a priority?

Emotional Data

AI Technology that can recognise our human emotions and tailor the response accordingly.

The Ambiguity of Human Connection

There are two sides to this problem and they are related to the ambiguity within the notion of ‘human connection’. One aspect that defines us is that we always long for a strong connection with our fellow humans. We literally want to get in touch with others. We want to have physical conversations. The pandemic has of course reinforced this in a dramatic way. I like to refer to this as the ‘connection of the FEW’, the dialogues we have (mostly between two people) in which empathy, emotions and non-verbal signals play a crucial role. Next to this, we also long for connection in a broader sense. As humans, we have an intrinsic need for a sense of belonging. In the past this used to be local – our family, friends and peers – but with technology playing a much bigger role, it has evolved to a more regional, national or even global setting. One in which we are constantly looking for communities we can connect to and where we can converse with like-minded people. The nature of this ‘connection of the MANY’ is much more remote and its dynamics are very different from the first meaning.

Technology Enabling Human Connection?

How to deal with these two faces of connection as a retailer? How can technology help – if it can help at all? If we look at the connections of the many, these have of course been massively enabled through the social media platforms that have been on the rise for the past decade. According to Hootsuite, internet users worldwide spend around 2.5 hours on these social media (by the way, the West is lagging behind here!), and this number is rising every single month. Technology has enabled us all to influence and be influenced 24/7. We share our adventures, our purchases and our personal emotions with whomever wants to read them. Our social ‘status’ is determined by the number of views, shares and likes. The big platforms got us ‘hooked’ on this sense of belonging and brands are using it to the max to create tribes of followers to increase their brand reputation.

But will we settle JUST for the connection of the many? Of course not. We want to interact with individuals, and we want to be treated as individuals as well. As customers, whether it be in B2C or B2B, we value highly personalised interactions. In fact, we EXPECT highly personalised interactions. We no longer settle for some generic recommendation; we want it to be tailored to our exact personal needs and preferences. For most companies, this turned out to be quite a challenge, and fortunately technology has come to the rescue. Once all the relevant data – the absurdly BIG data – are collected, smart algorithms powered by artificial intelligence can accurately predict what we as customers want (even if we may not consciously be aware of it ourselves!). Knowing what your customer’s favourite channel is truly matters. Delivering seamless experiences ACROSS channels will soon matter even more.

Now the question arises, is all this ENOUGH to deliver a great customer experience? Is it enough to make it easy for me to buy stuff or make reservations online? Is it enough if the recommendations consider all my personal data and behaviours? Isn’t the essence of our human ‘being’ that we are emotional beings? Could it be that technology can NOT personalise our experiences enough, because it is unable to take our current emotions into account as well?

The Next Frontier

This is where emotional AI comes in: AI technology that can recognise our human emotions and tailor the response accordingly. Leveraging our ‘emotional data’ will have increasing priority for many companies. Amazon, for instance, introduced the Halo, a new wearable device that constantly monitors your tone of voice to detect your emotional state. Amazon claims this is to track your health and wellness, but just imagine the wealth of data they acquire in this way.

But there are more elements than just our voice. Parallel Dots has developed technology to help detect sentiment or emotion in written text, which can be used to make written responses more accurate. Companies like Intraface and Affectiva can analyse facial expressions to detect people’s emotional reactions in real time, which can for instance help to determine how they react to specific scenes in movies or TV shows and where to put certain ads. The Affectiva technology is also being used in cars, with numerous applications to augment in-vehicle experiences. Just imagine the climate, scent, light or music in your car being adapted to your mood…

Many hurdles will have to be overcome for emotional data to be handled correctly. Not only are they more intangible and sensitive than our ‘regular’ personal data, but we will also need to consider cultural differences in expressing emotions, multiple reactions at once (e.g. with several passengers in a car), and external elements influencing people’s voices or face muscles. Until technology can solve the problem of human connection completely, especially in a one-on-one setting, we will remain in great need of human employees to take care of this. And to be truly honest, as a customer I am still very happy doing business with actual PEOPLE!

This artice first appeared in TWELVE, Serviceplan Group’s magazine for brands, media and communication. In the eighth issue, you will find further inspiring articles, essays and interviews by and with prominent guest authors and renowned experts centred around the magazine’s theme “A human-driven future: How humans are shaping the digital world of tomorrow”. The e-paper is available here.

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