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The Agile Brand with Greg Kihlström®: Expert Mode Marketing Technology, AI, & CX
#776: Black Friday Special: Zappi CMO Nataly Kelly on the high-stakes world of holiday advertising
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- [00:01]
Strayer University Announcer
The Jack Welch Management Institute at Strayer University helps you go from I know the way to I've arrived with our top 10 ranked online MBA. Gain skills you can learn today and apply tomorrow. Get ready to go from make it happen to made it happen and keep striving. Visit strayer.edu Jack Welchmba to learn more. Strayer University is certified to operate in Virginia by Chev and its many campuses, including at 2121 15th Street north in Arlington, Virginia.
- [00:30]
Natalie Kelly
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- [01:13]
Greg Kilstrom
Welcome to Season seven of the Agile Brand where we discuss the trends and topics marketing leaders need to know. Stay curious, stay agile and join the top enterprise brands and Martech platforms that as we explore marketing technology, AI, e commerce and whatever's next for the Omnichannel customer experience. Together we'll discover what it takes to create an agile brand built for today and tomorrow and built for customers, employees and continued business growth. I'm your host Greg Kilstrom, advising Fortune 1000 brands on martech, AI and marketing operations. The Agile Brand Podcast is brought to you by Tech Systems, an industry leader in full stack technology services, talent services and real world application. For more information, go to teksystems.com to make sure you always get the latest episodes. Please hit subscribe on the app you listen to podcasts on and leave us a rating so others can find us as well. And now onto the show. In a world drowning in data, is the big creative idea for holiday campaigns an endangered species, or is it more critical than ever? Agility requires not just moving fast, but moving with confidence. It's the ability to validate creative instincts with real world data, ensuring that your biggest bets are also your smartest ones. Today we're going to talk about the high stakes world of holiday advertising and the delicate balance between creative magic and data driven methodology. We're going to talk about one such campaign for John Lewis, a popular British department store whose holiday ads are a cultural event in the uk where the stakes can be high and they aren't alone. The holiday season is the equivalent of the super bowl for many brands, where a single campaign can define the entire year. Yet for every heartwarming success story, there are countless others that miss the mark. So how do brands de risk their biggest creative investments and ensure their message will actually resonate with consumers? Tell me. To discuss this topic, I'd like to welcome Natalie Kelly, CMO at Zappi. Natalie, welcome back to the show.
- [03:12]
Natalie Kelly
Thank you, Greg. I'm very happy to be here.
- [03:14]
Greg Kilstrom
Yeah, great talking with you last time and always glad to have you back here. Before we dive in though, for those that didn't catch you last time you were on the show, why don't you give a little background on yourself and your role at zapi?
- [03:27]
Natalie Kelly
Sure. So I'm the chief Marketing officer at Zappy and Zappi is a consumer insights platform and we help brands win with consumers through consumer data, fast, high quality data and in advertising, innovation and brand tracking. So we do look at a lot of these ads day in, day out, like the one that we're gonna talk about today. Our technology is used by 350 global consumer brands including PepsiCo, McDonald's, Heineken, Record, many of those brands that are in every household to keep them connected to consumers so they can make data driven decisions.
- [03:58]
Greg Kilstrom
Nice, nice. Well, yeah, let's dive in then. And I wanna start with the strategic aspect of this and we're gonna talk about one specific campaign but but also just more broadly. So for those of you in the audience less familiar, John Lewis, as I mentioned, a department store in the U.K. funny enough, I know this show is audio only, but I was in Edinburgh over the summer so I'm actually wearing something I got at John Lewis in honor of this episode. Let's just say their ads are a cultural event in the UK and we're going to put a link to one of the spots in the show notes as well. But this year's Where Love Lives spot is being seen as a return to form where after a few years their ads didn't seem to resonate as well. So for those that haven't seen it, can you maybe briefly describe it? And you know, as I said, we'll put a link in the show notes as well.
- [04:55]
Natalie Kelly
Yes, well, I highly encourage everyone listening to watch this ad. It is a beautiful ad. It is, as you said, Greg, a return to classic John Lewis emotional storytelling. What I love about the UK Christmas ads is they do feel like a little bit like a Mini movie. You know, you get such a storytelling arc, and you get that satisfaction of resolution at the end. Basically, this ad is about a father and son who've grown distant. As the son gets older, he looks like maybe he's a teen or a young adult. And it's capturing on those small, familiar moments where they're trying to reconnect. And I really love the fact that it's built on a powerful insight, which is, as kids grow up, families often struggle to find the right words, you know, in the moment. How do they connect and how do they communicate? And they have this line in the ad at the end that says, if you can't find the words, find the gift. And I think it's really a great line because it reflects something that is something that a lot of people feel but might not be able to articulate. You know, family relationships are tricky, and, you know, it's hard sometimes to know exactly what to say, but it just hits on so many relatable notes for parents and for family relationships that I think it's a really strong, powerful ad.
- [06:13]
Greg Kilstrom
Yeah, Yeah, I. I consider myself a relatively jaded ad marketing person, and I saw it. I was not expecting to feel anything, to be honest. But, yeah, it was, you know, definitely, definitely an emotional spot in the. In the right. In the right kind of way as well. So definitely at least resonated with myself. And it sounds like several other people as well, so for sure.
- [06:38]
Natalie Kelly
And, you know, it's interesting because when I first lived in Ireland, you mentioned you were just traveling in Scotland and got your John Lewis shirt that you're wearing right now. When I lived in Ireland, I was there for Christmas seasons, and I always was surprised by how emotional the ads are. They really do touch you and, like, move you in a way that I've never seen in the US market. And it's not just that emotional part, but the data actually validates. And so when Zappy tested this John Lewis ad, we tested it with 400 consumers on our Amplify ad system. It ranked in the 93rd percentile when we looked at 1,100 UK ads tested. So that's really, really scoring very high. And the distinctiveness norm is about 3.7. This scored at 4.1 because of the storytelling and the emotional impact. You know, love is one of the emotions that we looked at. And the norm for love is 22%. It was reported by 44% of viewers, so that's double the typical response. So you can see in the data how it's resonating with consumers emotionally, which is really, really cool.
- [07:44]
Greg Kilstrom
Yeah, yeah. And you know, you mentioned the, the more emotional aspect maybe of some of these, these UK ads versus, you know, how does that compare to US holiday ad approaches?
- [07:58]
Natalie Kelly
Well, I would say US advertising in general is just very different from UK advertising. The culture is reflected in the advertising essentially it's reflected in the creative. So, you know, our culture tends to be much more transactional and fast paced and a lot of these strong emotional ads you don't often see in the US but some of those are actually the ones that perform the best. And in the super bowl we saw like the Budweiser ad that was very emotional, had a family element, had some of the same notes that this ad does and it performed well too surprised. Humans like to feel positive emotions, you know, so, you know, like it's not, it's not really, that shouldn't be that shocking. But what is happening in the US is often because it is such a big market and there are so many competitors and when you go to a, like a supermarket in the US you see so many more products on the shelves than you do in a typical UK grocery store. It does take more to stand out and you know, maybe stand out apart from the noise. So there is that cultural element, but I think they're also just different economies and so that's maybe why we see some of these, these, these things. The US tends to focus more on short term activation and sales. You know, sometimes they mix those with holiday tradition ads. But the UK is really more focused on brand building and those heartfelt stories that reflect the culture at the time of recording. So I do tend to think holiday ads are like the, in the UK are like the version of the super bowl in the us. Those are the two big advertising moments in each country.
- [09:27]
Greg Kilstrom
Yeah, yeah. And so, you know, there's no one, one right answer for any of this. You know, whether relying on, on creative instinct or relying on data. But you know, beyond a single ad, what do you see as, as maybe the biggest strategic mistake when brands are maybe relying purely on creative instinct or you know, too far on the other side relying too much on, on data to, you know, make sure that they, they kind of cut through the noise in this campaign season?
- [10:02]
Natalie Kelly
Yeah, I think that's a good question, Greg. There's a few things that come to mind. You know, if brands are chasing trends, that tends to not work very well, especially when you consider the lead time that you need to build a good ad. Often if you try to incorporate a trend, it might not even be relevant by the time the ad comes to life. Right. And errors. So those types of little trends and jokes, they might get a quick laugh, but they usually don't build long term brand meaning and keep you your brand top of mind. For consumers. You don't want to be a flash in the pan. You want to be there consistently in their heads. So the other thing we notice is when we look at all these ads, you know, under investing in brand characters and brand assets is something that we've noticed a lot of brands make mistakes with. And the holidays are a prime moment when you can reinforce those distinctive brand assets like the Hershey Bells or you know, Coca Cola with Santa and like those associations that we, that we have with an ad that instantly make that brand come to mind. You know, another thing is you don't want to take the data too literally. You know, I shared some data points before, but you don't want to necessarily use those to drive all of your creative choices. You know, you, it's a little bit of art and science. You know, you need to understand the insights and the data, but the magic comes from combining that with the creative instinct to really amplify what works and fix the things that don't work. And that's, that's not easy.
- [11:32]
Greg Kilstrom
Right, Right. Well, yeah. And, and speaking of that, from the, from the planning stage, what are some signals that tell you that a creative concept may have legs versus one that's likely to fall? You know, how do you predict the stuff? You know, nothing's perfect, I'm sure, but you know, are there common themes or creative trends that are shaping what resonates with audiences this year?
- [11:58]
Natalie Kelly
Yeah, well, there is no one size fits all metric. And this is where the science of advertising and marketing and looking at these things in detail is really complex. Our most sophisticated ad development system, amplify breaks down key metrics like purchase, uplift and brand recall, messaging penetration, you know, emotional relevance, resonance, I should say, and then relevance and uniqueness, all those different factors and more. And that enables marketers to figure out, okay, what's the most important metric that I want to influence with this ad? You can't hit all of them. You know, there are some ads that do a decent job on many, but you have to make choices. So you know, if you are trying to drive short term sales, for example, then you probably want to over index on purchase, uplift and sales impact scores. If you want to build your brand over time, then you're going to dig deeper into uniqueness and relevance and brand Impact. And that's what we see more in those UK ads, especially around Christmas time. So, you know, we do a lot of testing and our customers do. We generate thousands of data points in one test. When you take that times, all the tests and you think those data assets that you're building over time give you like really valuable insights into. Oh, it looks like here's a trend. You know, maybe when we do this, the sales impact score goes up or maybe when we do this, the long term brand building component is even stronger. And that's where building a data asset really helps any marketer to just learn from what's special about their brand and learn how it's, you know, how consumers are relating to that over time.
- [13:33]
Greg Kilstrom
Yeah, and what you're talking about there too, not only does it require having access to the data and being, you know, being able to analyze the data, but also having an agile process to modify the creative. You know, a lot of these campaigns are at least traditionally, you know, planned months in advance and there's costs associated versus being nimble and able to adjust and respond and react to some of these things. How does a brand do that? You know, how did, is it, is it about trying to get rid of the bad ideas as early as possible or is it, you know, refining good ideas to be great or all of the above maybe?
- [14:13]
Natalie Kelly
Yeah, it's a bit of all, It's a bit of all those things, Greg. You know, and one of the reasons I love this podcast is the agile brand. You know, it is about being agile, it is about learning. And you know, often when I share kind of some of this data, people say, oh, I don't believe in testing ads. And I often say, well, Zappy doesn't believe in that either. We believe in learning. So you build better advertising. It's not about one ad, it's about your advertising program over time. That's how you build a brand. And so it's about that over time. But I would say pre testing, early stage, like you mentioned, you know, killing bad ideas early, that is really impactful. But I would say it's less about killing the bad ideas, more about uncovering the good ones, bringing those good ideas to the forefront so that you can build on them even further and take the best ideas that have the highest potential and then explore those further. And then for later stage testing, you can use key metrics like brand recall and purchase uplift to really nail your messaging and some of the finer details that will stand up for consumers. So, so I think there's a Place for testing at every stage. And you're looking probably at different metrics in each stage.
- [15:22]
Greg Kilstrom
Yeah, yeah. And to talk a little bit more about the emotional part of this, you know, certainly there's, there's lots of ways to measure, to measure success, holiday ads as we've talked about, particularly the UK ones. But you know, holiday ads in general are often designed to evoke emotion, build long term brand affinity, not just the immediate sales, although certainly that's a focus. How do you advise brands to measure the ROI of this emotional resonance and connect it to the long term value?
- [15:56]
Natalie Kelly
Yeah, I mean if you're going to grow brand affinity, that is a long term initiative. It takes time and you have to show up for consumers in a unique way when it counts. So what we often see is, you know, brand is really the key to long term growth. You know that phrase market share follows mindshare.
- [16:16]
Greg Kilstrom
Yeah.
- [16:16]
Natalie Kelly
So while teams can look at short term lift, they really need to think about the long term if they really want to grow their brands and be top of mind for consumers. So one of the things that we often recommend is brand tracking because with brand tracking it has historically been difficult to measure because brand is, you know, tracking has been prohibitively expensive and that cost means that even for the brands with the biggest budget, it's limited to just a few points in time when you measure the impact. So, you know, I firmly believe Zappy believes that marketers need a more continuous connection to consumers, an ongoing way of tracking, you know, how is the brand being perceived at more moments. That's why we've developed an agile brand tracker. So you've got monthly consumer pulses, so you can really zoom in to see, you know, what influenced the brand that month. And you can double down on what really works because you're getting more frequent data to inform those decisions. Make better ads, make better investments.
- [17:16]
Greg Kilstrom
Yeah. So it sounds like then in addition to the performance related data, the brand and you know, sentiment related data, they kind of go in hand. Hand in hand. Right. And that's kind of going back to the, the, to the earlier point. Those things together really make the agile and iterative improvement. Right. It's not just one or the other.
- [17:39]
Natalie Kelly
That's absolutely right. That's why we often talk about connected insights, because it's connecting the insights from the advertising that you're developing, from the products that you're developing, the innovations and how your brand is performing over time. It's not traditionally companies did this in silos. You know, they have one team over here using one tool to test ads, they have another team testing the packaging and the concepts and, you know, all these different stages of development. But if you connect them into a single place where you can see everything and get all the data, you can connect it all and understand more about what the consumer actually cares about. There's a lot of great insights that, like, oh, that package. Actually people like that aspect of the packaging. How do you feed that into the ad if you can't connect the data? If you know that they love. Oh, they love the way you twist that off and they like the sound of it or whatever, you could incorporate that into your TV ad, but not if you didn't connect those learnings from one to the other.
- [18:42]
Greg Kilstrom
Yeah, yeah. And so we can't complete a conversation like this without bringing in AI to some degree. So let's go there for a minute and, you know, talk about, you know, what role is AI having in this process? You know, how is it changing the creative development, the testing landscape and, you know, where do you see that going over the next, you know, 18 to 24 months?
- [19:08]
Natalie Kelly
Well, if you look at the recent Coca Cola ad, one of the things you can learn from that ad is to use established brand assets to develop unique creative with a fun twist each year, so long as you have the right brand guardrails. So the Coca Cola ad this year, you know, we tested it in our Zappi amplify system and The AD scored 94 out of a hundred on sales and brand impact. So really high scoring ad and love was reported by 55% of viewers. And that's the UK norm I mentioned was 22% and the Jammu said performed 44%. In the US it's 27% is the norm. And this Coca Cola ad was reported at 55% of you. Love was reported about 55%. So, you know, that's really great. It's great, you know, great performance. The unaided brand recall hit 83%. So the AI execution on that ad did not dilute the original Coca Cola iconic branding, which is really interesting because I think a lot of people think if you use AI to any degree, it might dilute the brand. But I think it's how you use AI that really matters. One thing that we noticed in that ad also was that viewers focused on Santa and the trucks and the animals and the festive music and the emotions like the joy, the magic, the nostalgia were really dominating in that ad. And the AI element was mostly invisible. You know, you couldn't really tell that AI was used. So it's really highlighting that meaningful creative ideas are still the driver behind a great ad.
- [20:47]
Greg Kilstrom
Yeah, yeah. Well, yeah. And AI is a supporting function in that case, right? Yeah, yeah.
- [20:54]
Natalie Kelly
And I mean, I recently was talking to Chris Bellinger, who's the Chief creative officer at PepsiCo, one of our customers at Zappy, on our podcast, and he mentioned this idea of minimum viable ideas, or MVIs, and talking about how you can test those with consumers to gauge their potential at a high level. And I think that's really where AI can make a big difference is AI can help you track those trends, AI can help you spot what are those minimum viable ideas that you can really bring further along in the creative process.
- [21:24]
Greg Kilstrom
Yeah, yeah. And so for the leaders out there listening and planning ahead for next year, what do you see as the. The single most important capability or maybe even mindset shift as we're talking about all the changes that are happening with AI adoption and all that? What's the biggest thing they need to adopt to ensure that creative not only connects but also drives business growth?
- [21:51]
Natalie Kelly
Yeah. I think the number one thing that we've heard, surveying and doing some research on our side in a report that we put out recently called the Connected Insights Imperative, we learned that data fragmentation is currently the biggest blocker reported by marketing teams and consumer insights teams to moving things along and getting closer to the consumer and winning with consumers. And so I would say data fragmentation is the number one thing to tackle for marketing leaders as they plan for next year. The reason I think that's happening is because more and more marketing leaders have been pressured by their boards and their CEOs to really lean into AI. And when they're trying, they're realizing, oh, our data is what's blocking us. We can't actually leverage AI to the degree we thought because our data's in all these silos, it's inconsistently structured, we can't make great use of it. So I think that is the number one thing that everyone should be thinking about is data fragmentation. How do we solve that? How do we connect our data and get it more aligned and get it so that we can leverage it and use AI to derive more value from it?
- [22:56]
Greg Kilstrom
Yeah, yeah, completely agree. Well, Natalie, always great to talk with you. Thanks for sharing all your ideas and insights here. One last question for you before we wrap up. What do you do to stay agile in your role and how do you find a way to do it consistently?
- [23:12]
Natalie Kelly
I love this question, Greg. Well, I work at a company that invented Agile Consumer Insights. So working at Zapi keeps me agile because we're constantly releasing the latest software to help our customers get that data from consumers and use it, build a data asset and use AI and get the most out of it so that they can stay connected to consumers. So that's what I do. I listen to my customers and I listen to the challenges they face and the struggles of their end customers who are consumers.
- [23:41]
Greg Kilstrom
Yeah, Love it. Well, again I'd like to thank Natalie Kelly, CMO at Zappi for joining the show. You can learn more about Natalie and Zappi and take a look at the John Lewis campaign we mentioned by following the links in the show notes. Thanks again for listening to the Agile brand brought to you by Tech Systems. If you enjoyed the show, please take a minute to subscribe and leave us a rating so that others can find the show as well. You can access more episodes of the show@theagilebrand.com that's theagile brand.com and contact me. If you're interested in consulting or advisory services or are looking for a speaker for your next event, go to www.gregkillstrom.com that's G R E G K I H L S t r o m.com the Agile brand is produced by Missing Link, a Latina owned, strategy driven, creatively fueled production co op. From ideation to creation, they craft human connections through intelligent, engaging and informative content. Until next time, stay curious and stay agile.
- [24:48]
Strayer University Announcer
The agile brand.
- [24:57]
Greg Kilstrom
And Doug there's nowhere I wouldn't go to help someone customize and save on car insurance with Liberty Mutual. Even if it means sitting front row at a comedy show. Hey everyone, check out this guy in his Bernie. What is this, your first date? Oh no. We help people customize and save on car insurance with Liberty Mutual together. We're married. Me to a human, him to a bird.
- [25:17]
Natalie Kelly
Yeah, the bird looks out of your league.
- [25:19]
Greg Kilstrom
Anyways, get a quote@libertymutual.com or with your local agent.
- [25:22]
Natalie Kelly
Liberty Liberty Liberty Liberty.
- [25:26]
Strayer University Announcer
The Jack Welch Management Institute at Strayer University helps you go from I know the way to I've arrived with our top 10 ranked online MBA. Gain skills you can learn today and apply tomorrow. Get ready to go from make it happen to made it happen and keep striving. Visit strayer.edu Jack WelchMBA to learn more. Strayer University is certified to operate in Virginia by Chev and as many campuses, including at 2121 15th Street north in Arlington, Virginia.