Thursday, March 24, 2011

Burger King: When Social Currency Isn't Enough

Great list (and accompanying video) from Adweek of Crispin Porter + Bogusky's (CPB) best work for Burger King.

Adweek's conclusion, "So, in the end, was CP+B good for Burger King? Financially, no. The chain struggled to keep pace with McDonald's every year of its tenure with CP+B, and the recession was brutal, in part because BK (and its agency) just couldn't figure out how to leverage its value offerings. But CP+B still achieved what it was philosophically hired to do: Make Burger King culturally relevant."

While it is true that BK had lost its "cultural relevance" in the 1990's, its purchase by Texas Pacific Group from Diageo in 2002/2003 began its revitalization.  Julian Josephson, chairman of the BK National Franchisee Association, told The Houston Chronicle in 2002 that, “Our brand was marginalized because of (Diageo's) competing liquor interests.”  TPG changed that by renovating stores, introducing new management, rescuing financially distressed franchisees, improving customer service and bolstering internal operations and morale.  (In 2004, Burger King had nine different CEOs over 15 years!)

One of those new managers was Russ Klein.  Russ had been my client at 7UP (he was at 7-Eleven, FCB, Bayer Bess Wanderwarker and Burnett), where was responsible for the 7UP Spot campaign.  He was one of those rare clients that provide their agency partners the room to be brave. (Steve Wilhite of VW was another when I was at Arnold.)

One of the first things that Klein did was to fire Y&R who had won the account only nine months earlier. "There is an urgency to build brand momentum to drive traffic and get results," CEO Brad Blum said about the firing. "The creative team at Young & Rubicam failed to produce ads that would turn around decreasing sales during the agency’s nine-month run with Burger King." Mmmm.  Doesn't sound like "cultural relevance" completely drove the decision per Adweek.

He then hired Crispin (the fifth agency-of-record in four years), who, up to this point, was known for their IKEA, BMW Mini and "Truth" anti-smoking work (they won the Cannes Grand Prix for Ikea "lamp" ad). Again Blum's expectation was that Crispin was going to come up with "groundbreaking, next-level, results-oriented and innovative advertising that strongly connects with our core customers." Further, "We must have the kind of results that Crispin Porter + Bogusky have proven they can deliver." (Incredibly, Blum would be fired a few months later.)

To Blum's explanation, Nations Restaurant News opined, "Uh-oh. The agency must be feeling the heat from that fire. But agency president and chief executive Jeff Hicks said he isn't feeling pressured. A desire to turn sales around is what he feels."  Mmmm.  Again, doesn't sound like "cultural relevance" completely drove the decision.

However, according to Jeff Hicks, Crispin's CEO at the time, Burger King's biggest problem was its bland image. "You wouldn't have wanted to walk around in a Burger King T-shirt," he said.

(Interesting side note: It wouldn't be the first timer but perhaps a bit of nepotism and revenge went into the decision – Hicks and Klein were both Burnett alumni.  I believe Hicks started at Burnett in 1987, the same year Klein left. Also, Ron Bess, Y&R New York's CEO, whom Klein must have known and probably worked for at FCB and Bayer Bess, was fired by Y&R's owner, WPP CEO Martin Sorrell.)

It also sounds as if Crispin's pitch presentation was truly unique:
Burger King CEO Brad Blum sat amazed by a seven-hour agency pitch. "They didn't even show us the first TV spot until after the third hour," he recalls. Instead, the pitch concentrated on rebranding Burger King at every entry point, from uniforms to the tray liners.
And it probably helped that both were Miami-based.  But when it came to Crispin's work, it seems that Adweek was correct in focusing on Crispin's job of building "cultural relevance."  A year after the win, Hicks echoed his T-shirt remark:  "The mission is not about generating awareness of Burger King" as commercials typically seek to do, "because everyone knows Burger King," Mr. Hicks said, adding: "We want to make a connection. We want to make Burger King the kind of brand people would want to wear on a T-shirt.  We want the pop culture dialogue to include Burger King."

While Y&R's "The Fire's Ready" work fizzled, results from a study of the BK brand using Y&R's BrandAsset Valuator continued to reverberate.  As reported in Social Media and the Burger King Brand, "The study showed that Burger King was a brand that people knew more than loved. This was a serious red flag for Klein. He said: 'When they know you more than they love you, it is either a precursor or a condition of a brand in decline. No brand should feel comfortable about their growth prospects when your consumers think they've seen all there is about you and further, that they find it unremarkable. Our key objective was to become, again, a brand that people would love to know more about, a brand that is on the move in pop culture.'"

Pop culture relevance or social currency is an interesting idea.  As I wrote in "Building Loyalty Through Belief":
Today a brand is likely to be defined by the value created by a community and its members, i.e., by its  social currency. Clay Shirky, “If the traditional model of brand marketing was centered around the key principles of positioning, targeting, and messaging, the model of building social currency is centered on interaction, collaboration, conversation, and co-creation. If brands used to be built through creating mindshare, the new model of building social currency is about creating share of daily life.”
According to Vivaldi Partners 2010 “Social Currency Report ,” six levers can be independently used to drive social brand value:
  1. Affiliation: The sense of community your users share.  Social interaction creates feeling and assurance, as well as emotional ties among users.
  2. Advocacy: The number of community members who evangelize and defend your brand.
  3. Conversation: The share of users who recognize and generate buzz – news and information spreads faster among an active community.
  4. Identity: The number of users who are able to identify with other users. Connecting with the right community makes users feel better about themselves (think Saturn and Harley Davidson owners and Apple users).
  5. Information: The number of users who feel they exchange fruitful information with others. Relevant knowledge and support solve user problems and perpetuate loyalty.
  6. Utility: The number of users who derive value from interacting with other users.
Douglas Rushkoff likens social currency to a good joke. "When a bunch of friends sit around and tell jokes, what are they really doing? Entertaining one another? Sure, for a start. But they are also using content – mostly unoriginal content that they’ve heard elsewhere – in order to lubricate a social occasion. And what are most of us doing when we listen to a joke? Trying to memorize it so that we can bring it somewhere else. The joke itself is social currency. 'Invite Harry. He tells good jokes. He’s the life of the party.'  Think of this the next time you curse that onslaught of email jokes cluttering up your inbox. The senders think they’ve given you a gift, but all they really want is an excuse to interact with you. If the joke is good enough, this means the currency is valuable enough to earn them a response."

For Burger King, it wasn't enough to create a single point of relevance, the joke needed good to be ongoing. And Burger King found the perfect partner in Crispin whose employee handbook defines advertising as “anything that makes our clients famous.”

So, how did the two go about making Burger King famous and culturally relevant? By focusing on four things:
  • Giving up control. From the "Truth" work, Crispin learned that conventional antismoking appeals, forcing teens to ingest, "This will kill you" messages, made rebellious kids want to smoke even more. Instead, they learned to give up control and become part of the conversation.
    As Klein, speaking at the 2007 CMO Leadership Forum, puts it, "Social currency means surrendering your brand over to that collective conversation going on out there, and they’re going to say good things about you and bad things about you. You need to get over it. The hypothesis is that social currency is not about some tidy brand positioning statement that’s suitable for framing, but it’s a self-assuredness of a company and a brand, and a willingness to live among your customers like a friend who is occasionally the brunt of the groups joke, but is committed to being there because that’s what real friends and real brands do. It’s a disposition that says, “We don’t have to go into damage control and spin, when someone takes a swipe at us.” It’s an epic that abides by the idea that it’s not about us, it’s about the consumer; because it’s not what brands are saying, it’s about what others are saying with no obligations about brands.
    “Have It Your Way” is our global brand promise of empowerment. Around the world in 65 countries, we serve flame-broiled Whoppers to over 10 million customers a day, but beyond the promise of better burgers, “Have It Your Way” symbolizes a much bigger social transaction that’s going on. It’s inside of that social transaction that we want to be the currency exchange. We view enabling social connectivity among individuals as a means of empowerment. At its most basic level, it’s about putting our customer in charge, but doing it in a social, connected way. Consumers want to be connected to others, and a brand like BK, not just because eating out is social, can play an active role in that connection, if we have the insight to do it.
    • Going beyond traditional TV ads.  The BMW Mini launch taught Crispin that cultural relevance meant being involved in the target's life beyond just being on TV.  CPB generated buzz by putting Minis in all kinds of weird places: inside sports stadiums as seats, on top of SUVs, as centerfolds in Playboy. Street props were created, including a coin-operated children's ride in the shape of a Mini. There were Mini games, Mini booklets, Mini suitcases, Mini placement in movies – and last and perhaps least, a few Mini commercials that almost never air. By the time the car was introduced in spring 2002, the buyer waiting list was six months long.  Crispin now begins each assignment with the question, "What if there were no TV and no magazines – how would we make this brand famous?" If someone tries to bring Bogusky a TV commercial idea right away, he says, "I won't even look at it."
    Klein again, "I think that today’s consumer increasingly would say that a lot of companies like to advertise, and I tend to listen when the company isn’t the advertising type. Which, to me, doesn’t mean 'Stop advertising,' but it underscores the need to find ways to put the consumer in charge of your advertising by manufacturing social currency, staying relevant, staying current, shedding your skin and staying fresh.
    According to Crispin's Hicks, "We think the future of advertising is great products that have marketing embedded in them." Google and Starbucks both don't use much traditional media to get their message across, he said. But that's because their marketing is embedded in the brand. The role of advertising is to push consumers toward products. At the center is the product. Advertising is at the periphery, with packaging and customer relationship management and distribution as the layers between it and the product. The agency's job is not to interrupt but to create content that's entertaining. It should be content so valuable and useful that [consumers] wouldn't want to live without it.
    For example, Crispin looked at BK's paper cups and went beyond simply printing "Burger King" on the side. The agency wrote hundreds of clever and funny blurbs on cup wraps – including the definition of "bagglers," straggling fries left in the bag. The copy described whose bagglers they were when they fell into the bag if there were multiple orders.
    "Great ideas, not channels, create buzz," said Hicks.
      • Focusing on the right target.  McDonald's targets families and kids and promises older people the nostalgia of experiencing their childhood again. It is perceived as childhood's oasis, ripe with playful innocence. Wendy's targets adults with a promise of a classic hamburger dining experience – Wendy's is the realm of the adult, signifying quality, peace, and being cared for. So, the only place left for Burger King was surly adolescence. Actually, adolescence and the eighteen- to twenty-four-year old demographic align nicely. That led BK to do two things:
      First, they focused on teens to young adult males, what it called Super Fans. Super Fans were regular visitors to quick service restaurants. They ate at fast food hamburger restaurants nine times per month or more. They comprised 18% of BK's customer base but accounted for 49% of all visits. Martha Flynn, BK Senior Director of National Promotions and Sponsorships, said, "Our Super Fan goes to all quick-serve restaurants – McDonald‘s, Wendy‘s, and others. He's not loyal to us. We just want him to come in to Burger King more than he does now."
      Second, they focused on the emotional component of adolescence. Burger King wanted consumers to associate their brand with excitement an power:
      "Adolescence (for some of us, anyway) was a time when power and control was wrested from our parents to our own pimply selves. Think control, freedom of emotions, and rights of passage. This is not to say that Burger King targeted adolescents specifically. After all, paper route and babysitting salaries can only buy so many Whopper Juniors. BK just wants to bring out the skate rat in all of us. When adults partake of the Burger King experience, they can hearken back to the days of roller disco and "Laverne and Shirley" (or rollerblading and "Saved by the Bell," as was the case for the mostly-under-thirty student audience). When adults have it their way at Burger King they can say to themselves, "My life is unfair, but now I'm in control. I'm the boss, if only for a few minutes." And if real, live adolescents convince their parents to drive them to BK and buy them stuff, all the better. "What's good about adolescence transcends age," said Klein. (Speaking at Harvard Business School in 2004)
      • Tension.  Creating a feeling of tension and then releasing it in favor of your brand can be a powerful consumer motivator.  The idea is to set up two opposing or conflicting forces that are essentially equal, creating a frozen state in the consumer’s mind. Then, “discharge the tension in favor of a particular product or a particular product category,” says Klein. Speaking at the MSI “Customer Insights for Innovation” conference in 2009, Klein said, “Nothing positions and repositions like tension.  It forces your brand into a point of view. Through shear force, it separates you from competitors with superior relevance and empathy.” In the “Whopper Freak-out” campaign, for example, commercials showed Burger King customers “freaking out” when told that the Whopper had been removed from the menu. The tension: “When deprived of something that you crave, nothing else will do,” Klein says. The release: It’s only a hoax – you can still order a Whopper. Klein says such a strategy must emanate from top management and be used in all levels of the organization. “If the outcome of a process is not a competitive advantage, then it is not a strategy,” he says.
      Incredibly enough, Klein's idea of tension did such a good job at capturing what Crispin's had been doing, that Bogusky adopted the idea and now it is included as part of the formal creative brief:
      Klein calls tension the key element in any creative brief – whether the theme is deprivation, purity or,  anger. ("Angry Whopper" spots explored the "origins" of the new spicy sandwich, for example, a farmer growing "angry onions.") "We're always looking for these turbulent, emotional insights in the brief," Klein says. "Most agencies wait for that to come out in the creative development process. For us, it's something that we put more upstream."  The process, he adds, "liberates" the creatives to try anything, so long as they "discharge tension around the insight, which is really, when you think about it, the essence of humor."
      The key to creating tension is to know that it doesn't always feel good.  "We have to keep creating social currency. If we don't, we'll die.  You have to have the stomach for taking risks. We don't go out of our way to offend people. We do go out of our way to create tension."
      For Bogusky, "Generally culture is going multiple directions at any one time.  And pop culture, specifically, is always having this conversation with itself about where to go.  A lot of advertisers talk about relevance, but they never define it.  What is relevant?  To me being relevant is to be in the conversation that pop culture is having about any particular topic.  But if you're going to be relevant, you're going to be somewhat controversial because culture hasn't really decided, okay, this is the direction now.  And so, you have to be – if you want to do that kind of work – you have to be okay with the heat that comes with being relevant."
      In addition, Klein and Burger King focused on product quality and innovation and trying to over deliver on the guest experience, constantly generating new products that were relevant to the Super Fan: Enormous Omelet, Fresh Apple Fries, Angus Steak Burger, double, triple, and quadruple Stackers, Homestyle Melts, Hold'em wraps the TenderCrisp Chicken Sandwich, Healthy Kids Meals; as well as developing new store designs: 20/20 and The Whopper Bar.  BK also rolled out a series of Xbox games that sold for $3.99 with the purchase of a value meal at the restaurant and featured the King and his pals Whopper Jr. and the Subservient Chicken.

      "The basis for all this," said Klein speaking at the 2007 CMO Leadership Forum, was "to recognize that we’re not just a food brand, but we’re a social brand, and that rekindling the love for the Burger King brand would result in return to being socially relevant, or as we call it, social currency, a concept we use every day at BK."

      Michael Palmer, Executive Director of Association of American Advertisers, summarized it this way: "They got down and partied. They ingrained their brand into the fabric of their core customers by giving them something fun to talk about. They returned to social relevance by providing consumers with interesting content and by surrendering their brand to their customers. This is the ultimate in listening; giving your customers the opportunity to tell you in their own content and words, what they feel about your brand. This is how to make friends. I’ll bet most of you remember seeing the King score an NFL touchdown, or the subservient chicken perform. Did you talk to a friend about those ads? I know I did. That’s social currency – that’s making your brand relevant again

      So were the jokes successful?

      There is very little published data indicating whether or not BK has achieved any overall cultural relevance.  Google Trends shows an overall upward trend of the search term "Burger King" from 2004 to 2010. But that's all the public data I can find.

      Results for individual campaigns are more readily available. Subservient Chicken is possibly one of the most successful marketing websites of all time. Upwards of a half a billion hits. Twenty million unique visitors.  "Dr. Angus" won a Silver Effie award in 2005. "Whopper Freakout" won a Grand Effie in 2009. And "Whopper Sacrifice" won a Silver Effie in 2010.

      Burger King has been mentioned on Super Fan germane shows such as The Daily Show with Jon Stewart, The Colbert Report, The Tonight Show with Jay Leno, the Late Show with David Letterman, and Arrested Development.  They had tie-ins with the Simpsons, SpongeBob, The Office and 30 Rock; Twilight: New Moon, Iron Man, Transformers, Spider-Man 3, Star Trek, and Indiana Jones and the Kingdom of the Crystal Skull.

      While Crispin might have been philosophically hired to make Burger King "culturally relevant," sales are still king.  According to data pulled from Burger King's Annual reports, same-store sales increased every year from 2004 to 2009, going from an average of $1,1014,000 per store in 2004 to $1,259,000 in 2009.

      So from the limited data available, the jokes appear to have been successful.  Yet Burger King still fired Crispin as agency-of-record.  Why?

      One key reason: McDonald's envy.  By themselves, Burger King's results look pretty good, but when compared to the real king, McDonald's. things don't look too rosy.  Between 2003 – the year before Burger King hired Crispin as agency-of-record – and 2008, Burger King’s share of the burger-chain market fell to 14.2% from 15.6%, according to Technomic, while McDonald’s share rose to 46.8% from 43.6%. McDonald’s has posted average annual sales growth of 6.3% compared with BK’s 2.9% gain during that period.

      This difference was noticed by Wall Street, as reflected in Burger King and McDonald's share performance over time.

      Vivaldi Partners conducted a study in 2010 that indicated that the philosophical job of creating "social currency" also wasn't met.  Burger King actually came in last place among the fast food companies Vivaldi measured.

      In fact, Burger King came in last place in almost every category that makes up Vivaldi's overall "social currency" score.

      Virtue, another company that measures social currency, lists Burger King as #57 in its Top 100 Social Brands of 2008, with McDonald's as #32; but BK dropped off the top 100 in 2009 and 2010: McDonald's is #62 in the Top 100 Social Brands of 2009, and #66 in the Top 100 Social Brands of 2010.

      The Atlantic's Derek Thompson blamed Crispin's ads for the poor results:
      "To the surprise of nobody, Burger King's horrible, creepy advertisement campaign is not working, and the company finds itself falling further behind McDonald's according to just-released figures. This strikes a huge blow to the idea that what Americans want from their fast food joint is a Bobblehead King doll who sneaks into your bed, raps about square butts, and terrorizes you from outside your bedroom window. Yes, those were advertisements for hamburgers.
      (T)he main lesson here is that people should stop trying to make fast food cool. It's a convenience, not a social indicator. But instead of doing something very boring – advertising human food with humans and food, rather than an overgrown mannequin charming his way out of restraining orders – BK gave us gems like the Burger King Flame Body Spray. Because what every young Americans secretly desires is to make possible this exchange:

      Girl: "What are you wearing?"
      Boy: "Burger King."
      Girl: "Marry me?"
      However, according to Fast Company writer Cliff Kuang, Crispin's ads shouldn't shoulder the blame:
      "Advertising is a weak lever to effect change in a sprawling, franchised operation like Burger King. Why? First off, one of McDonald's historically brilliant moves was to own the land that its franchises sit upon – and to lease that land back to the franchise operator. Burger King – and most of its other competitors – don't have that arrangement. And that matters because as the land owner, McDonald's has leverage in redesigning its stores that its competitors sorely lack. Witness how well McDonald's is overhauling the design of its stores, and how lackluster those efforts have been at Burger King and Wendy's. Granted, part of that problem is that Burger King needs to hire better designers – as these hideous designs prove – but the fact remains that they can only do so much. Moreover, restaurant placement is also vitally important, and McDonald's has the best land in the business.
      Now, as the Ad Age article says, there are problems with Burger King's product mix, and the niche that the "King" ads try to carve. But their current woes have far more to do with structural weaknesses in the business, than their ads. And that's really the thing with ad agencies: They might promise a turnaround, but they seldom have the right conditions to pull one off. A turnaround of a place like Burger King is about doing many things at once – some of which might be impossible."
      BrandIndex surveys 5,000 consumers each weekday and calculates a brand’s buzz score by asking, “If you’ve heard anything about this brand in the past two weeks, was it positive or negative?” The firm then subtracts negative responses from positive ones. Survey results from July 2010 uncovered another reason for Burger King's problems, reasons way beyond the control of Crispin: "Quick-service restaurant chains, especially the largest brands like McDonald’s, Burger King and Wendy’s, have recently been accused by numerous consumer or activist groups of offering unhealthful food and undertaking unscrupulous advertising. From shareholder requests to end marketing surrounding Ronald McDonald, to questions about protein sourcing and calorie content, to marketing to children with toys, fast food is under pressure, and consumers are taking note.  Further, because they are so big and prominent, McDonald's and Burger King "have taken the brunt of the backlash at times among different government groups or consumer groups saying fast food contributes to obesity.”

      As sales went south, frustration grew among Burger King franchisees, who had been calling for a change in the company’s marketing strategy for several years. The end of the relationship with Crispin Porter was viewed as a step in the right direction by many of these franchisees. They blamed the company’s heavy marketing focus on the super fan for driving away other customer groups ranging from women to minorities.  Turns out that during the recession, the BK Super Fan stopped eating at fast food joints.

      “We need to start focusing on all our good customers, not just on any one specific group,” said Alex Salguero, a longtime Burger King franchisee with stores in Georgia. “If we’ve learned anything from the last few years, it’s that we can’t afford to be too narrowly focused. It works against us and alienates our other customers.”

      In October 2010, Burger King was sold to 3G Capital, the new owners have replaced the entire executive management team and slashed hundreds of jobs.  Klein left the company and Crispin soon followed.

      It's unclear what the new agency will focus upon, but it's clear that being incredibly successful at building "cultural relevance" cannot overcome deeply entrenched industry problems and larger economic trends.

      In the end, in honor of Crispin's great work, let's all raise a cup and share our favorite Crispin joke about Burger King.  Congratulations on the long run!


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