Watson on the runway – Q&A with IBM’s Keith Mercier on Watson’s role in transforming retail

IBM Watson loves to ingest data (that’s the official verb). Most compellingly, Watson’s favourite meal is unstructured data. After helping out in the healthcare and life sciences sectors, the ‘cognitive computing system’ is turning its talents towards helping the retail sector and its customer experiences. Marketing chats to the man pitching Watson’s talents to retailers, IBM’s Keith Mercier.

This week IBM’s global VP for Watson Transformation in Retail, Keith Mercier, visited Melbourne Spring Fashion Week’s (MSFW) industry event to show a room full of retailers and fashion designers one of the many possible uses of the company’s artificial intelligence/cognitive computing system, Watson.

Watson took on the form of ‘My Stylist’ in a smartphone app, recommending an outfit for its user to wear. In coming up with the advice, Watson asked the user questions including, “What sort of mood are you in?” and pulled together unstructured data from weather reports, scheduled calendar events, and the latest looks from Pinterest. Mercier told the audience that apps such as this were changing consumer’s expectations of brands – and such expectations were often coming from other industries.

“My son orders from a pizza place in San Francisco,” Mercier told the audience. “He’s 14 and he and his friends always order from this one pizza place because he gets a text at every stage of the pizza preparation process. The first one when it’s being made, when it’s put in the oven, when it’s being boxed, and when it’s in the car. He’s 14 and he can track his pizza from order to delivery.

“How do you think he’s going to be walking into a retail store that can’t find an out of stock item?”

He also discussed the results of IBM’s recent global consumer study, which we discussed last month in this article.

Marketing sat down to chat with Mercier after the MSFW event.

M: That was a great little app you showed up there. Can you give me some examples of times where you’ve used something similar to that?

KM: Well we’re very new, so we just launched Watson in retail in February of this year. We’re a very new business so we’re really in the process of getting the word out and helping our retail partners understand what Watson is and that cognitive computing is and how that’s very different to the programmable world of computing we’re in today where we tell a computer to do something and it does it.

Watson is more of a learning type of computer – it’s not actually a computer, it’s a capability where it reads and understands information – and then you can ask questions in natural language back to Watson and Watson will go find the answer for you and say, “This is what I believe is the answer, and this is how confident I am that this is the answer, and if you would like to test my confidence, let me show you where I found the pieces of data that make me confident that this is the top answer”. So it’s very open that way, it’s not a black box, it’s not something that you just put in a question and it magically comes out with an answer.

I really think of Watson more as an advisor versus giving you an answer, because at the end of the day we still all make decisions on our own, but having more information quickly can make us allow us make a much more informed decision.


M: So it’s sort of a more intelligent version of a search engine in a way?

KM: Well, the thing about search is search doesn’t understand your intent. Search looks at keywords. Watson actually passes out a question, and says, “This person is asking a question about a place, potentially a time, with these certain constraints”. A search engine would just look at a couple of keywords, and it will bring up 50,000 results, and somewhere in there you have to find the actual answer.

Watson does that additional work for you, and says, “I believe after reading the 50,000 potential results, I’ve scored them, I’ve ranked them, I’ve actually hypothesised against them, and these are the top three”, and it does in about the same amount of time as search.

The other part you have to know is Watson only does that on data that it learns. So it doesn’t just know anything, you have to actually train Watson about we call it a ‘corpus of data’, a body of data – you say, “Watson, learn this”.


M: So if a retailer wanted to invest in, say, the My Stylist app that you had as an example, how do they go about it? How do you teach Watson what you want it to know?

KM: Well, the first thing that we do is we typically spend time with the retailer helping them understand what it would take to implement a cognitive engine like that. Where are all the places that you would want to find data? Purchase history, weather, in that example. Do you want to put in mood? What happens when they click ‘flirty’ versus ‘sexy’? What type of questions would you want it to ask next to help guide the dialogue? So there’s a process where we work with retailers for a few weeks just building and listing what we call the ‘use case’.

Then we actually go into a process called ‘configure and train’ where Watson starts to ‘ingest’, is the term, it sounds so weird, but thats the term, ‘ingest’ the data. Spreadsheets, PDF files, HTML, it’s all unstructured content, and that’s what Watson loves is unstructured data. So when you think about social today and how important social mobility is becoming and the amount of data that consumers are creating about their retailers, Watson is a way for retailers to quickly understand what people are saying in that data versus hiring big teams of people to constantly go through and review what people have said.


M: In that way its a bit of an investment in social listening?

That’s one way you could deploy it. I showed a way that you can have Watson help you figure out what to wear in the morning. There are ways that you can deploy Watson inside a company where if I’m a sales associate and I’m trying to help a customer on the sales floor who’s interested in this denim, I can quickly ask Watson, “What other colours do these jeans come in?”. Because I might be in a small store in a big city and I’ve got red, white and blue but it also comes in green, brown and these others, but I don’t even know that, so Watson can help me out.


M: So is this a way for retailers to almost control the message? People are walking into shops with their smartphones and maybe they’re searching a competitor. So is this a helpful way for them to keep it in the company?

KM: What I would love to see is retailers using Watson as the engagement part of their app. So retailers today are spending a lot of money and time developing apps, which really are about a store locator, some of them link to shopping. But consumers are really having a tough time engaging with them because there’s not a lot of utility there.

So if Watson was the place I could go open my app and start engaging with some questions, and go, “I’m looking for a little black dress under $20, what do you have in size small?”, versus going to the e-commerce site, going to black dresses, clicking size small, and then looking for all the prices. It can really change the way a consumer navigates a brand, on an omni-commerce site, on a device, or in the hands of a sales associate, helping a sales associate be more knowledgeable.

If you think about the Q and A that a sales associate has with a customer today, none of that is recorded. So once the consumer leaves that data is gone. But if that sales associate is now recording, asking questions based on what you’re interested in, that’s a whole bunch of new information I just learned about you as a customer, and if I have a customer profile of you and I can now add this to you and I can actually send you more relevant communications from my brand because now I know you’re interested in little black dresses, I didn’t know that before. Those type of opportunities, to capture that data and keep it and make it useful for the consumer for the future, I think is really where Watson is going to make a change.


M: I put together a story the other day from some data that said retailers are quite behind compared with other industries in adopting technology. The stats we had were 21% of retailers in Australia are developing apps and only 30% have websites. Have you found that retailers are struggling to work out how to adopt technology? 

KM: That seems low. Globally, yes, no doubt. Like I said when I first got up, the change of technology adoption in the last five years by consumers is faster than IT executives can get budgets approved. It really is amazing how consumers have just fallen in love with the smartphone, and other industries have used technology and other online brands – there are other industries that are training [consumers]. My pizza example – a small local pizza house that decided, “You know what, let’s just do this”. I don’t know what system they’re using, but its changing the expectations of my son and the way he thinks about shopping now.

It’s changing so quick. 10 years ago, it was “We’ve got to get into the e-commerce business”, and they have, and now you have this mobile thing, and now they’re all kind of coming together. I think the real challenge is integration, because the consumer says, “You’re one brand to me. When I pick up my phone, when I get on my tablet, when I’m sitting at home on my computer, it all needs to feel like the shopping experience is continuing”. That’s where they’re really struggling today, but they are focusing.

ALSO READ: Retailers slow to improve technology for mobile shopping – study »

Really where I see a lot of them going is inventory, because inventory is the crux of everything. Consumers want to know where it is and retailers want to know where it is because thats the biggest cost, so it’s a really great place to start. Then the data and understanding who my customer is as a single view – those two are the really foundational areas that we see retailers focusing on right now, as kind of the building blocks to get to the true omni-channel experience.


M: One thing we thought was really interesting was about Watson itself, from a marketing point of view, is that it’s this abstract computer system, which is difficult to understand, but it’s got a name – we thought that was a really great way of marketing.

KM: Is it a man? Is it a woman? Watson has a man’s voice, Watson has a female voice. Well it’s named after Thomas J Watson, our founder at IBM. Really, where Watson made its inroads was, our technology team does these challenges, and when they started developing the artificial intelligence really like 10 years ago, someone said, “What if you could get it to play a game show and win?” You’ve heard of the Jeopardy game show, and once Watson won, then they realised, “I think we might have something here. Now what do we do?” It was originally a challenge and then they said, “Well wait a minute, where can we deploy this in industry?”

The first industry was healthcare and life sciences, so you actually have cancer doctors that are using Watson to plug in proposed treatment plans for patients, and Watson is going out and reading a ton of data and bringing back reasons why it would work, why it wouldn’t work. It’s helping those doctors make better decisions and faster than they ever could today. It’s been successful there for the last kind of two to three years, and then in financial services and then in February it was, “Now let’s go out in industry”. So we are very young and new, we’re like a start-up to some degree, which is very fun, and at the same time we certainly see lots of opportunity for it.


M: So, out of all the industries you could have chosen, why retail this early on?

KM: Well it’s not the only one. We’re also in travel, transportation, we’re in legal, some others as well, but IBM has a deep history in retail, so why not? It made perfect sense. We have such great relationships with such leading retail brands that are now looking to us for transformational road maps because technology’s now playing such a big role in the consumer experience – it just made perfect sense to say retail.

It’s one of the things we’re now bringing to industry, and we’re the only one that has it right now. We’ve developed this, we’re very proud of it, and we want to partner with them to help kind of co-build this together, and I think that’s what’s wonderful about doing something so new, is that you don’t have to follow the old rules. So we’re working with retailers, saying, “You help us. You tell us what you would want to do with this”.


M: How does it work between big business versus small business? I’m imagining it’s going to be quite an expensive technology to bring on. What about for smaller brands?

KM: Well it’s new. So all new technology is very expensive at first. But it would be great if it could it get into small business, certainly. And one of the things we’ve done is when we launched Watson, we opened up the API, and we’re developing a whole ecosystem of third party partners, that are using Watson and coming up with use cases, coming up with their own solutions. Those companies are in a position to potentially work with smaller organisations.

So the technology will be available. Again, that’s very new, we have two or three signed on now, that are really doing interesting things. They’re doing things in a very different way, and their pricing can be different, and they may be more accessible to smaller companies. My hope is that over time, if you’re going to usher in a new era of computing, everybody needs access to it. Now its very nascent now and expensive, I wouldn’t say expensive, but for a very small company, I wouldn’t say it’s the first place that they should be spending money, right? But over time I hope would be that it’s available at every price point and every level.


M: It learns from what data you give to it, so would it ideally get to the point that you don’t need people that know about software development? Is it that smart?

KM: No it’s not that, it only knows what you train it to know. It can’t execute tasks yet. It can’t write code. Right now it’s helping be an advisor. Over time we’re developing, we’ve just launched a debater. So now we have a version of Watson that can help look at a problem where there’s no right or wrong answer – abortion. So Watson can go out and come up with reasons why thats okay and reasons why not, but reveal the data. So we’re expanding Watson’s capabilities beyond Q and A now, debating, but over time there’s a very long roadmap. We want to co-develop that with industry, so we make sure what we focus on is going to be valuable to our industry partners. It’s still early but lots of potential.


The 10 key insights from the ‘Connected Life’ report into Australia’s digital behaviours

Australians typically own nearly five online devices and spend more than three hours a day online for personal use, according to a new report  by global market researcher TNS.


TNS shared key insights from its ‘Connected Life’ report at the Digital Next Australia 2014 (DNA://14) conference in Sydney and Melbourne this week. The report is the world’s largest study of digital attitudes and behaviours across 50 countries.


The 10 key insights from TNS’ ‘Connected Life’ report 

1. Australia is one of the world’s most connected countries. On average Australians own 4.8 devices and spend 3.3 hours a day online on personal interests (eg. browsing, shopping, entertainment).

2. Connected home. 19% of consumers report they are connecting mobile devices to other devices in the home with another 28% expressing interest in using this technology in the next 12 months. This means a potential 47% market penetration in 2015.

3. Connected car and self. Similarly in cars, 16% of consumers report usage of in-car connectivity while another 18% express interest in future use. For smart or ‘quantified self’ devices that monitor biometrics, 18% report current usage with interest from a further 17%.

4. Online wins over TV. Australians spend an average of 3.3 hours online for personal use as compared to 2.2 hours watching TV. When you consider multi-screening (eg. watching TV while using another device), only 53% of TV time is undivided. Still TV is a viable channel during specific times of the day as below.

5. Time of day dictates the channel. Despite considerable channel fragmentation, consumers are showing signs of predictability at certain times of the day. For example, one third (31%) go online first thing in the morning, while TV is the more popular channel over dinner (36%).

6. Smartphone penetration as high as laptops. Smartphones grew 5% from last year to 75% which for the first time places the smartphone in line with laptop penetration. Smartphone penetration is highest among younger consumers yet interestingly as high as 60% amongst those aged 50+.

7. Tablets hit mainstream status in just four years. Tablets grew 16% from last year to 46% placing tablets firmly in the mainstream; this is considerable growth given tablets have only been in market since 2010. Additionally, tablets achieved at least 40% penetration in all age groups making this device an important channel.

8. The connected pathway to purchase. ‘Showrooming’, the act of evaluating products in store and later making a purchase online, has levelled off at just over 40%. However, a deeper look shows online and offline experiences melding into a complex dance. On average, there are seven touch-points that exert influence (e.g. seeing an advertisement, reading consumer reviews, evaluating competing products, looking for offers) yet this still often leads to an in-store purchase – a process called ‘web-rooming’.

9. Broadcast is out; engagement is in. The demand for more media, more often is limitless. In this new hyper-connected world, people are consuming more advertising messages than ever before but with the expectation that brands know them and their needs.

10. Micro-segmentation is essential. Media and device fragmentation means there are a wealth of potential ways to reach people. Understanding these patterns allows the targeting of individuals and groups to be far more precise and ultimately delivers against both long and short term marketing objectives with greater accuracy.


TNS Australia executive director Alistair Leathwood said with tremendous growth and complexity of the digital environment, marketers would experience both challenges and opportunities.

“We should be marketing by occasions, needs, attitudes and the various mindsets for different media, reaching customers through specific channels at specific times of the day,” Leathwood said.

Other speakers at the Digital Next Australia 2014 conference included Burston-Marsteller chief operating officer Margaret Key, GroupM’s Xaxis Australia general manager Esther Carlsen and Y&R Group chief digital officer Rod Hudson.


The giant’s shoulder – Intel brand profile

This feature first appeared in the May 2011 issue of Marketing magazine.

Intel ditches the geek-speak and is now rubbing shoulders with pop culture icons like The Sartorialist and Will.I.Am. Belle Charlene Kwan uncovers the reasons behind the IT giant’s new cool persona.  

Bum… Bumbum… BumBum!

Just three letters repeated five times on a page and we bet that the iconic ‘Intel Inside’ tune is now sounding in your head. While the more tech-savvy would be able to immediately identify the sound with Intel, even the most casual of computer users would have most definitely come across the little medley. Kate Burleigh, marketing director of Intel Australia, claims that the chime, called the ‘Intel Bongs’, is the most recognised sound in the world.

This is a rather large claim to make for five notes created in 1994 simply to accompany the ‘Intel Inside’ campaign. When, however, the statement comes from a brand that is respected by almost every computer user in the world, perhaps that claim can be justified.

Another big tout from Intel is that its brand spearheaded the trend of associative or co-op marketing with its ‘Intel Inside’ campaign. Burleigh even suggests that Intel should be credited for helping build the popularity of Wi-Fi!

With such bold proclamations, one does ponder how did Intel – a microchip manufacturing company that produces processors no bigger than a quarter of a square inch – reach such fame and recognition? Because, quite frankly, most of us will go our entire lives without ever actually seeing an Intel product, but, unknowingly, using one each day.

According to Burleigh, aside from producing what is commonly regarded as the most reliable and efficient computer processing chips in the world, Intel is, all about branding. The brand strategy is simple – make consumers care about Intel. That way, they not only want to know more about Intel products, but, more importantly, they build brand loyalty.

Makiko Eda, Intel Asia Pacific’s marketing manager, explains, “Intel’s marketing strategy is threefold – strengthen the Intel master brand, make the Intel Core Processor [the brand’s current line of products] a hero product in our portfolio and help consumers choose the right technology at the point of purchase.”


Those younger years 

Burleigh explains that it has only been in recent years that Intel has placed such strong emphasis on marketing Intel as a brand.

Started in 1968 by physicist and chemist Gordon E Moore and fellow physicist Robert Noyce, Intel mastered its first microprocessor in 1971, followed by the world’s first microcomputers in 1972. Since then, the company has manufactured processor chips that are used by the majority of computer companies such as IBM (now owned by Lenovo), HP, Dell and, just recently, in 2005, even Apple.

During the 90s, Intel dominated the market with the Intel Pentium chip, and stuck to the brand name of Pentium for over a decade. It took until 2006 that Intel made the big move of going through another branding overhaul and rebranded its processors Core. Instead of having a single processor chip, Intel now offers a range of three different chips based on capabilities and performance, naming them Core i3, Core i5 and Core i7.

There was also the much talked about partnership with Apple, a computer company that has long produced its own microprocessors. Burleigh explains that in 2005 Apple decided to cease production of the company’s own PowerPC processing chips and switched to Intel because, “Apple knew that Intel had a superior product and that its own processors were holding it back from advancing to the next stage of its product design”.

Today, all Apple desktops and laptops run on Intel processors.


Intel today

Intel, which has historically focused much of its marketing effort on pushing the sub brands of its microprocessors, as well as communicating product features, is currently making a shift in its branding strategy.

“We are now focusing more on communicating end user benefits and the experience that our products deliver,” says Eda. The aim of the current strategy is to increase brand awareness of the Core line of products, but, more importantly, of the master brand.

“Intel used to lead its branding with its processors, like Pentium, but people did not necessarily know that it was an Intel product, or did not immediately associate the sub-brand with the Intel master brand. So, we are going back to basics and building equity in the brand of Intel,” says Burleigh.

But why did Intel decide to change a formula that had won the brand its leading position in the market? Burleigh attributes a growing number of competitors leading to a need to gain a louder share of voice. Other microprocessors, in particular AMD, began to gain popularity with the public. This shift was brought about by the growth in low-cost PCs, which did not require the powerful processors that Intel consistently continued to produce, thus leaving competitors free to target original equipment manufacturers (OEMs) that were keen on low-cost, average-performance microprocessors.

In answer to this varying demand of computing needs, Intel’s new range of Core microprocessors offers consumers three levels of capabilities, from i3 to i7 – catering to the different computer users. “It was crucial, though, that instead of sticking to our formula of product information pushing, we needed to strengthen the master brand of Intel, and remind consumers that Intel should be the only choice for them,” says Burleigh.

Building a stronger relationship with its customers is now an important focus for the computing giant, and this is the reason for the birth of Intel’s new campaign, titled ‘‘Visibly Smart’’.

Launched in January 2010, the campaign’s central message is that Intel is a brand that helps unleash its consumers’ creative potential and has helped inspire individuals to create visibly stunning and creative masterpieces. The campaign was kick-started with a series of short films on well-known creative industry leaders, showing how Intel plays a crucial role in their artistic lives. The most popular of the films featured US blogger and fashion photographer Scott Schumann, better known as The Sartorialist, and is a short documentary on his visual life and how Intel plays a key role in it.

The ‘Visibly Smart’ campaign aims to show that powerful microprocessors can make a big difference in a user’s life, as shown by Schumann. Burleigh says, “We want to move away from selling raw performance; we want to show what a high performance processor can bring to life. The use of individuals who are creative and have clout gives us artistic licence – it shows us to be like the paintbrush for an artist, the essential tool of their trade.

“With the Sartorialist,” she continues, “we show that high-speed Intel processors make a big difference in his life and work, giving him the ability to download, edit and then upload thousands of pictures with high efficiency – and thus helping him work better and be more creative. By aligning ourselves with such an iconic fashion figure, the strategy is to show that we are not just about calculating processing speeds, but we are an important part in creativity and the cultural industry. We help create lifestyles and support different media formats – we make computing easy, so that people can spend time on being creative.”

The brand also recently named The Black Eyed Peas’ front man Will.i.am as director of creative innovations, a move that continues to cement Intel’s presence in modern popular culture. Burleigh explains that with the partnership with Will.i.am, Intel demonstrates to its consumers the same message of ‘Visibly Smart’ through music, where Intel becomes the perfect partner in the artist’s musical creations.

“Will.i.am is a music genius. Although he produces commercial pop music, he is involved in every step of the creation, and Intel plays a big part in the tools of his trade. He embodies the Intel brand because he understands how the right technology with the most powerful capabilities has helped him create music,” says Burleigh.

Another campaign with which Intel is actively engaging consumers is the ‘Sponsors of Tomorrow’, promoting Intel as a sponsor of consumers’ futures through innovative technology. “Because you cannot see or touch our product, it is important to create an emotional connection between Intel and our consumers,” says Eda.

Intel also views its own engineers as crucial players in shaping the future. As Burleigh explains, “Intel engineers spend an incredible about of time predicting and forecasting what the future trends in technology will be. Bearing in mind that it takes approximately four years to research on a microprocessor, and another three years to carefully build each component and put it together, engineers end up having to look at least seven to eight years into the future and evaluate what will be in demand.”


Technology leaders

On the production line, it is inarguable that Intel is the most dominant market player in the micro-processing field. Microsoft, which operates on a large number of computers and laptops, currently runs most of its Windows software solely on Intel chips. With superior speed and performance, Intel also balances this off with the design of chips that are able to cool quickly and use minimal battery source. According to Burleigh, while this specific connection is hardly acknowledged, Intel believes that the reason personal computers look the way they do today – slim, light, portable – is primarily driven by the advancement of the Intel processing chips. “We believe that Intel chips are a big factor in driving the creativity of PC manufacturers in giving them so many new options and capabilities to design new looks, thanks to the advancement of Intel products,” she says.

She gives the example of the new Apple iMac range of desktop computers, which she calls ‘all-in-one computers’, where the entire system is housed within the computer screen body. “All-in-ones were possible because of Intel chips and their capability to cool quickly, therefore allowing smaller housing bodies.”

Working with multiple OEMs such as Apple, Dell and HP, Intel must understand each of the different brands’ strategies and provide technology that caters to their needs. Whether an OEM wants to conquer the low-cost category or excel in product performance and design, Intel has to be able to provide the right hardware at the right price to align with each strategy.


Forks in the road

One issue the brand found problematic with its past branding strategy was the lack of focus on the primary Intel brand. Consumers knew how good the microprocessors were, but they labelled them with their own names, often leaving out the Intel branding.

Another issue that Intel faced prior to its latest Core offering is the frequency with which the company released new chips, leaving consumers confused and unable to keep up. At the same time, OEMs were also unhappy with having to constantly upgrade their hardware and software to match the latest Intel chips.

“We know that our brand isn’t perfect,” says Burleigh, who has been with Intel for over 12 years. “In the past, we came across the problem of self-cannibalisation, where we end up ‘killing off’ our own product by constantly coming up with a better one too soon. The saying goes that only the paranoid survive, and it’s the motto that Intel goes by with our constant need to upgrade and improve our products, even though we are already best in market. However, this constant upgrading means that we cannibalise our previous product and it can become frustrating for our stakeholders. For example, when we release a microprocessor chip, we educate OEMs, retailers and end consumers that it is the best product in the market. A few months down, after they have fully experienced the powers of the chip, we then release another one that’s even more powerful, or more efficient, thus making our previous product seem inferior.”

Another problem stemming from Intel’s frequent upgrades was the confusion in names and consumers being unable to differentiate one chip from another. Burleigh explains consumers research these days before purchasing, and when they come across too many variations of the Pentium chip range, it became overwhelming.

With the new range of chips branded Intel Core i3, i5 and i7, Intel is attempting to simplify identification of its product range by using numerals to differentiate each product’s level of performance.

“Since we launched the first generation of Core Duo chips two years ago, the feedback is that the strategy has been successful in helping consumers understand the variations. With the launch of our second generation in April 2010, responses from all levels, from OEMs to everyday consumers, are that it is now much easier to identify the different products we offer,” says Burleigh.

“Now, with our new naming strategy, it is easy to explain to consumers that while on the outside, two computers might look identical, one that contains an i7 chip will perform [in a] more superior [fashion] to one that contains an i5 chip. It’s that simple.”


Nudging out the competition

While Intel has been sitting in pole position for most popular computing processor chip for over two decades, there are consumers who, instead of thinking they can choose between Intel and another brand, take it for granted that Intel will be in all computers. “We sometimes consider our success to be a trap,” confesses Burleigh, “because customers become complacent and think that as long as they buy a computer, it’s definitely going to be an Intel chip inside.”

Burleigh stresses that, more often than not, when shopping for a computer package, the deals that seem too good to be true often are!

“With the ‘Intel Inside’ campaign, we consistently remind consumers to look out for evidence that they are buying an Intel product. Usually when a retail person begins talking about how great a computer is, but leaves out any mention of what processor chip it contains, chances are it’s not an Intel microprocessor,” she warns. “We do not want to give our competitors any chance to sneak their way through, so the ‘Intel Inside’ campaign really helps in alerting consumers to what they are purchasing.”

On 24 April this year, Intel will be celebrating the 20th anniversary of its ‘Intel Inside’ campaign, which the brand proudly considers the first example of a success story in ingredient branding. “At Intel, we call it co-op marketing. We make a partnership that is mutually beneficial for both parties – where if the OEM agrees to put our ‘‘Intel Inside’’ logo on its product packaging, we will offer them rebates for their final sales. Of course, today it’s common practice across multiple industries, but we are confident that Intel started this trend,” says Burleigh.


Reaching out

The bulk of Intel’s marketing strategy relies on third-party opinions. Preferring to let technology experts do the talking, Intel allows for trusted individuals in different target groups to disseminate their own opinions on whether Intel’s products are worth purchasing. This tactic of using brand ambassadors is especially useful in the gaming industry, where, over the last five to six years, Intel has stolen the crown away from AMD as the best gaming microprocessor chip.

“We do very little advertising with gamers, but instead let gamers themselves review our products. There will be times when people choose to go with the underdogs, but, at the end of the day, this is a highly technologically driven group of individuals who will opt for the best performing hardware. So instead of directly advertising to them, we let the engineering, and the opinion leaders, speak for themselves,” says Burleigh.

Intel does support the gaming industry by sponsoring multiple gaming events across different countries, and distributing peripherals of its latest products. “Gamers love our t-shirts, caps, lanyards and other accessories with the logo of our latest processors. It’s almost like bragging rights to this group of people, who like to be seen using the most powerful equipment in the market.”

As mentioned earlier, the ‘Intel Inside’ campaign successfully branded Intel as a product that, even though it can’t be seen, consumers would know that it was inside the machine they were purchasing, and would consciously seek it out. “By putting our ‘Intel Inside’ logo on either an OEM’s box or on the computer itself, it helps remind consumers that while they do not get to see the Intel chip itself, it is ultimately what is inside a computer that counts, and the campaign taught them to question what processor chip a computer was running on,” says Burleigh.

This was especially crucial two decades ago when all computers “were generally rather unattractive and looked the same” adds Burleigh. Consumers would make their purchase decision based largely on the speed and efficiency of the computer, and that was how Intel differentiated itself. Even today, there continues to be an ever-growing demand for faster processing. “At the end of the day, a computer can never have too much bandwidth or processing speed, and Intel aims to live up to those expectations as best as we can,” says Burleigh.


The global citizen

Intel, the head office of which is in Santa Clara, California, manages to embody a brand identity that is cohesive throughout the different regions. This, according to Burleigh, is thanks to the brand’s efforts in listening to various marketing departments from different countries, gathering suggestions and feedback, and finally deciding on branding that is most agreeable and successful for the brand in a global sense.

“For example, with each logo that Intel creates for a new range of chips, admittedly we in Australia will never get to design our own logo or modify it in any way. During the development process, however, each office around Intel is given the opportunity for input and comments. In fact, corporate marketing at HQ appreciates feedback and they take into account every opinion and finally come up with the best answer.”

The Australian arm of Intel, however, which includes between 35 and 40 employees, does decide how retail and consumer-level marketing is executed to best suit the local market. “Whether it’s through events, corporate announcements or even deals with OEMs and retailers for in-store promotions, we get to lead with our own domestic strategy,” says Burleigh. “We decide on which media to use, what kind of PR to lean towards. Of course, at the end of the day, the overall brand strategy and message must be globally aligned.”

According to Burleigh, Intel Australia engages in heavy channel marketing, where the brand communicates closely with resellers. By understanding how different retailers operate and the products that do well in different stores, Intel is able to cater to each retailer’s unique needs and promotional advantages.

For Burleigh, another large portion of the Australian marketing strategy is speaking to IT websites, because the majority of its target market do online research prior to purchasing. “We engage in plenty of PR activities with trusted online tech experts, and feel that it’s always beneficial to have good comments from reputable individuals in the tech space. One portal we engage with quite frequently is the Notebook Hunter. We do numerous sponsorships with the website in order to be able to fund the writers’ detailed analysis of computer software and hardware, including our products, but at the same time ensuring that our involvement is completely non-influential.”

In terms of mainstream advertising, Intel Australia can be noted to advertise in two main bursts each year with a strong use of television. Over the past two years, the branding message has seen Intel reinvent itself from information-heavy to having a quirky and creativity persona that reflects a modern and trusted brand.

“In the marketing department, we are often faced with the dilemma of whether to go towards a more product-orientation marketing approach, or to focus on branding the Intel name,” says Burleigh. “It’s a challenge to strike a balance with both sides, but as much as the engineers would prefer us to educate our consumers on how each product works and why they should go out and buy it immediately, we cannot be too informational from the start or we will just end up being boring. Our current strategy is to lead with the brand, create brand awareness and a good rapport with our audience, and then feed them the more technical information later.”

With the ‘Visibly Smart’ campaign, Intel has tailored the content to suit different cultures and cities that Intel has successfully penetrated. In the APAC (Asia-Pacific) region, in particular Korea, Taiwan and south-east Asia, instead of using Hollywood and mainstream US celebrities to execute the creative content, different brand ambassadors have been chosen. Earlier this year, Intel chose Girls’ Generation, a highly popular Korean pop group, to launch the second generation Intel Core collection by filming a music video that featured stylistic renditions of the new logo to “communicate the excitement of visual experience brought by the new processing chips,” says Intel’s Asia Pacific marketing manager Makiko Eda.

In order to speak effectively with different target audiences across APAC, Eda explains that each country’s marketing department worked out a strategy that would resonate across each individual culture and was encouraged to articulate their unique needs and propose the effective ways to activate the global strategy. “It was crucial that each country stood on its own to create an effective marketing message.”

“In Asia, we worked with Korean pop group ‘Girls’ Generation’ as brand ambassadors to market our second generation Core processors. This was used in Korea, Taiwan and some South East Asian markets.”


Paying it forward

In Australia, Intel was heavily involved in supplying immediate aid to Queensland and parts of Victoria affected by the recent flooding. Intel has also been actively involved in building the education sector by providing free training for teachers on how to embed technology into their everyday curriculum.

“We want to teach them to be comfortable around technology, because, at the end of the day, teachers educate our children, who will in turn become computer consumers, but, more importantly, potential engineers and developers of the computer industry. We want them to be properly educated and it obviously has to begin with the educators,” says Burleigh.

On a global scale, Intel’s production plants aim to be accountable in their water usage and waste reduction efforts. “We aim to use 100 percent recycled water wherever possible and want to reduce materials used. At the end of the day, our ultimate aim is to become the cleanest manufacturer in the world.”

The company also invests heavily in the fields of technology, science and engineering by giving back to communities where the company has manufacturing plants. “We know that often when we set up a manufacturing plant at a location, it becomes one of the largest employers in the region and we are appreciative of that and give back to their communities wherever possible, whether it’s education, charity or community building. We have dedicated corporate social responsibility teams in these regions to hold managers accountable to ensuring that proper community works are done. We do not want to be the evil global company; it’s part of our culture to give back.”

The company also has a charity scheme, whereby the company matches employee donations. Whether it’s natural disasters or an ongoing long-term charity, Intel attempts to support employees’ philanthropic efforts to give back to the community. At the same time, Intel regularly sends volunteer teams to areas that are affected by tragic natural disasters. And, as a rule, should any Intel employee wish to volunteer and be part of the relief effort team, their managers are required to allow them days off without affecting their salary or performance review.


What’s next?

Though Intel seems to have a strong grip on being the dominant player in the micro-processing industry, there are technology experts and forecasters who predict that this monopoly may not go on forever. Steven Titch, a telecom and IT policy analyst who writes at www.techliberation.com, says that with the growth in popularity of smartphones and tablet PCs, there may be disturbance in the market with the entrance of other chip manufacturers such as Nvidia, Qualcomm and Texas Instruments. “In high tech, one company may dominate a sector for a while, but a convergence of trends can dislodge that grip quickly,” says Titch.

On Intel’s front though, the brand will continue to drive its ‘Visibly Smart’ campaign to further strengthen its new identity as a creative tool. Burleigh also envisions Intel once again making a big leap in the uptake of technology and unique branding. “First, there was the use of sounds for corporate identity, and embracing co-op branding. I also believe that Intel helped bring Wi-Fi technology to where it is today. When we first launched the Centurion chip, we embedded the ability to have wireless internet in all the computers that came with our chip.

“A few years before the actual launch of the product, Intel was out speaking to airports, restaurants and other public places on how wireless internet would be the next big thing. We educated phone companies on how Wi-Fi will be in every home and every office. People were initially sceptical and could not understand why one would want to use the computer anywhere other than the study, and we questioned back, ‘Why not?’ We understood that one can never have too much technology and needed to sell it to the rest of the world. In short, we believe we engineered Wi-Fi!”

However, Intel’s squeaky-clean image may be slipping. The brand ran into public relations nightmare on 31 January this year when the company had to recall $700 million worth of ‘Sandy Bridge’ parts, a code name for a Core processor running on many PCs. Netizens flooded forums and blogs expressing their unhappiness at the brand. With a growing number of competition brands dipping their toes into the market, it would not take many more mishaps before Intel slips off their pedestal. Will the giants reign, or will complacency and changing trends bring them down? We can only wait and see.

The world’s cartridge – HP brand profile

This feature first appeared in the September 2010 issue of Marketing magazine.

From ‘Halo Rooms’ to Seoul, Sean Greaney takes a look at the many faces of Hewlett-Packard.

“Everything that can go digital, will go digital,” the Israeli messiah repeats to his rapt ‘parishioners’. He has brought the prophecy that ushered in the era of digital print east to Seoul, and stands by it. The messiah is Benny Landa, an Ogilvy-level enigma in the printing world.

In 1977, Landa moved to Israel to found Indigo, a company that would focus on research and development. And for years it did: according to Landa it produced no whole product for 16 years and generated $200 million in that time (he coined the term ‘patent fence’ and owns over 500). In hushed and deferential tones at Seoul’s Grand Hilton I’m told that if I own a printer, Landa probably invented some part of it.

Among his many patented (don’t you forget that!) miracles, Landa is credited with inventing digital offset printing. By extension, that’s a modern marketer’s ability to create personalised direct mail. Seven years later, Hewlett-Packard (HP) would recognise the value of Indigo to the tune of $882 million (after Indigo achieved long-term revenue goals).

Upon acquisition, Landa remarked, “Our vision has always been to lead the printing industry into the digital era and to see Indigo technology pervade the commercial printing market. Now, as part of HP, that goal is in sight.”

The Indigo story mirrors HP’s somewhat, though HP’s is the progenitorial Silicon Valley start-up success fable. When starry-eyed entrepreneurial minds drool over the houses Apple and Microsoft built, they’re really gagging over the second generation.

In 1938, two men, Bill Hewlett and Dave Packard, electrical engineers out of StanfordUniversity, flipped a coin in a one-car garage to determine whose surname would take pride of place in their new company’s brand. Bill won. The garage is now Heritage-listed.

With $538 investment capital, they founded a company that in 2009 would generate US$114, 552 billion in revenue: the world’s largest technology company by revenue – excepting Samsung, the interests of which are even more diverse than HP’s, roaming as wide as real estate.


An acolyte of the big idea

In 2002, following its acquisition of Compaq, the brand launched ‘Everything Is Possible’, centred on the equation device ‘(customer) + HP = everything is possible’. It leveraged some of HP’s big clients: the New York Stock Exchange (NYSE), Amazon.com, FedEx, DreamWorks, National Aeronautics and Space Administration (NASA) and Bang & Olufsen. It groped some celebrity brands, but the focus was corporate juggernauts.

At the time, VP of brand and marketing communications Garry Elliot explained the move, saying, “This is the most assertive, creative brand campaign HP has done. We decided the best way to become recognised as the world’s leading technology company was to simply tell it like it is. But rather than focus on what we make, this campaign focuses on what we make possible on behalf of our customers, our clients and our partners.”

Four years later, with a new CEO (more on that later), HP launched ‘The Computer is Personal Again’. This campaign has been a no holds barred, rub-against-as-much-cool-as-possible, celebrity endorsement love-in, albeit a well-executed one. Those lending themselves to the cause include: Jay Z, Jerry Seinfeld, Serena Williams, Vera Wang, Mark Cuban, Pharell, Vivienne Tam, Petra Němcová, Jessica Simpson, the Sex and the City girls, Gwen Stefani, Mark Burnett and Shaun White. And I think I missed some. These endorsements roam from Jay Z’s nonchalant TVC telling us he’s got his “whole life in this thing… new Frank Gehry plans for my team, in Brooklyn… gotta track all my investments ’cause I’m gonna retire, right? Ha. My passport says Shawn, but you may know me by another name,” as “Jay Z, CEO of Hip Hop” pulses toward the screen, to designers sexing up netbooks, to product placement.

Goodby, Silverstein and Partners (GSP) has shown a restraint that probably raised client-side eyebrows in decommodifying product through a more translatable, if perhaps lower-impact, communication than Apple’s lauded campaigns of the noughties: the TVCs deliberately obscure the endorsing celebrity’s face – and the ads are all the more artful and engaging for it. Imitation, flattery and that whole axiom are the true mark of a successful campaign though; it has spawned a few spoofs ostensibly ‘starring’ Bill Gates, Steve Jobs and Keanu Reeves.

Both brand campaigns, they have seen HP climb Interbrand’s ‘Best Global Brands‘ from number 15, valued at US$16.7 million in 2002 to 10th place valued at nearly US$10 million more (although rivals of varying degrees Intel, GE, Microsoft and IBM all place more highly from a brand value perspective). Any CFOs, CSOs or sales directors who’ve wandered into the wrong magazine may balk at my next juxtaposition, but in 2002 HP sat at 28 on the Fortune500. In 2010 its Fortune500 rank matched its ‘Best Global Brands’ rank: 10th.

Both campaigns were developed by GSP; its evolution, and I’d say strategic convergence, is the recently launched ‘Let’s Do Amazing’. Hosted by Rhys Darby – better known as Murray the manager from Flight of the Conchords – the campaigns walk the now very familiar territory of endorsement, this time from Annie Leibovitz, Viacom, DreamWorks, an unnamed, sort of ‘everyman’ financial services company, the International Space Station (!), HP Labs and HP’s CeNSE sensors, United Parcel Service (UPS), Dr Dre, The Venetian Hotel in Las Vegas and Avatar. The difference being the convergence of corporate and celebrity interests alongside media brands, likely moving toward a more cost-effective campaign for both business and consumer audiences.

“From an imaging and printing perspective our strategy is to focus our marketing efforts through the line. For example, in the consumer printing area HP’s focus is on promoting our innovative and leading ‘web printing’ offering and we have done this with some above the line activity in print and digital media, experiential activity focused on high traffic locations where consumers would be to showcase the product, such as airports, press relations activity targeting tech, daily and lifestyle media and in-store activation programs with aggressive promotional offers, sales training and incentive programs for the sales reps on the store floor, as well as point of sale materials that explain the range and highlight the differentiations of HP,” touts Jacqueline Ibrahim, marketing manager, printing and imaging group, South Pacific.

“One program that we have implemented is the HP live demonstration program, which allows consumer and small business users to go into a store and test HP product for themselves. This allows them to test the print quality as well as see a live demonstration of HP’s innovative ePrint and Print Apps available across the new consumer range… We will be expanding this program to include live wireless internet enabled units in-store, which allow us to showcase HP’s innovative web connected printing.”

Pretty standard stuff, eh? But wait, there’s more.

“We are also focused on leveraging social media to communicate our products and technology and will be launching a social activation program partnering with a reputable museum in Melbourne that allows consumers to send their prints via ePrint (simply by sending an email) and watch them being printed in this world famous museum. This is designed to demonstrate and communicate the simplicity of HP’s ePrint technology with the aim of this activity being viral and communicating this value proposition to the masses,” says Ibrahim.

I’ll break one of my rules and call the idea innovative. But HP hasn’t embraced, or at least resourced, social media across the board, or if so has elected to adopt the ostrich strategy regarding negative commentary. The comments to your right, at time of writing were found unanswered (and not unique in that state) on the first page of HP and HP Australia’s Facebook pages.



“The HP board just made the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago. That decision nearly destroyed Apple and would have if Steve hadn’t come back and saved them,” wrote Lawrence Ellison, CEO of Oracle and friend of former HP CEO Mark Hurd, to The New York Times (‘former’ following accusations of sexual harassment from HP employee Jodie Fisher, one time reality TV contestant and loosely defined as a ‘marketing contractor’). The allegations were eventually disproven by HP, but a probe did find falsified expense claims concealing a relationship between the two.

“In losing Mark Hurd, the HP board failed to act in the best interest of HP’s employees, shareholders, customers and partners. The HP board admits that it fully investigated the sexual harassment claims against Mark and found them to be utterly false,” continued Ellison.

Hurd’s five years at HP saw a number of successes and tough decisions: he cut 10 percent of the company’s workforce (15,200 people), reduced the number of software applications from 6000 to 1500, halved the IT department to 8000 and shrank the company’s 85 data centres to six. The savings went toward more salespeople.

Facing the recession, he imposed a five percent pay cut on all employees, took a personal cut of 20 percent and, following HP’s acquisition of the company, enforced EDS (Electronic Data Systems) employee salaries into line with HP structures – meaning cuts of up to 20 percent. He then predicted a five percent sales fall, but six percent profit rise. Of course, his 20 percent pay cut was refunded by the compensation committee.

When questioned on the impact the scandal has had on B2B relations, HP declines to comment, but is happy to confirm its partnership with Oracle continues – a significant interest at 140,000 shared customers.

Whatever the impact, Hurd’s ejection was a costly affair at US$34.6 million in severance, options and stock. He’s now residing on Oracle’s board, a tense position given the shared customers and Oracle’s recent acquisition of Sun Microsystems, putting it in direct corporate hardware competition with HP.

United we stand

It’s cold, wet and I’m finding out about the downside of last month’s Superbrand Profile, Vespa, as trucks buffet me about the Burwood Highway. Uncharacteristically running late, I’m ushered rapidly into the apparently heavily booked ‘Halo Room’ for a product-focused session with Ivy Liang, VP of marketing for HP, Asia Pacific and Ibrahim. Liang appears to be sitting about a metre and a half from me, but is actually in a Singaporean ‘Halo Room’: three crisp screens provide a wraparound view of her room, while a fourth above allows those meeting to share videos and presentations. Lag is non-existent.

Every conversation and presentation I am involved with while researching HP focuses on four trends clearly driving the day-to-day, and this meeting is (repeatedly!) no exception: content explosion, mobility, digitisation and moving to a service-based business model. An internally conducted digital content audit predicts that by 2012 available content will have increased tenfold. A function of this, says HP, will be a threefold increase in printed pages, a very important metric. Digitisation refers to the conversion of content and mobility the consumer trend in digital devices.

“A lot of people were asking us: ‘Is printing on a declining trend, since a lot more content is already in a digital format?’ In one way it’s true, the proportion of content being printed out will be less, but, on the other hand, the [amount of] content is increasing 10 times. So the printable content, we’re actually projecting it to increase by three times. So the absolute number is increasing, even though the proportion is decreasing. That’s what we see as the trend,” says Liang.

So while the brand ostensibly believes the world of printed pages is about to swell like so many boab trees, it’s hedging its bets around its golden goose by moving away from a goods focus to services. Or rather, from what I’ve seen, service offerings attached to premium goods.

Partnerships also appear to be a big focus – perhaps a logical step for the voracious acquirer, but, again, more on that later. One such partnership is based around a product I, as a Gen Y male, had never heard of: photo books. An evolution of the photo album, they’re a phenomenon in Japan, Korea and much of Asia. A surprise to me, their popularity has increased, Ibrahim explains, from four percent of Australian households in 2009 to eight in 2010.

“According to PICA 2010, the median number of pictures taken by households with digital cameras was 345. In Australia, 55 percent of households made prints from digital camera images in 2010, and the median number of prints or copies made per household was 100. Australian households typically print 55 percent of the prints they make at home on the computer printer and the remaining 45 percent on a photo-printer designed specifically for a digital camera. Nearly 60 percent of households printing at home used photo paper for all of the prints they make. Photo cards and photo books are the most prominent and popular photo-publishing products in Australia,” says Ibrahim. “The biggest inhibitors for end users are the perception it is difficult, time consuming and expensive.”

This flurry of data has driven partnerships with Kmart, Ted’s Cameras and Camera House, providing kiosks that move the production of these products from the black-rim framed eyes of designers to the bleary eyes of young mothers.

“One of the key limitations for these creative products is people perceive them to be really difficult to create, and actually think it’s really expensive. So one of the things that we’re working on with our partners locally is how can we communicate that this is actually relatively simple, and it also can be done relatively quickly. And a key differentiator for HP’s retail publishing products is it only takes one hour to actually collect your book, and so we’re going out and communicating that a lot. If you go into a Kmart store, you’ll see a lot of messaging around one-hour service. A lot of the communications they’re doing in market is around that, and also the actual software that operates on these kiosks is really easy to use, because that’s another thing that’s really daunting about these photo books: people think they need to be some sort of tech guru to actually work it out. So they’re some of the differentiators of HP, and it is a challenge to communicate that, because you’re trying to get over that hurdle. So we’re doing a number of different things in communicating that through media relations activity as well as when they’re in-store,” explains Ibrahim.

Kmart was selected for its demographic, reach and previous experience with photo labs.

“We actually work together with them to set up the entire store, the entire in-store experience – how do we get the customers, what kinds of solution we want to show to them, who are the customers we want to talk to, and what are the products we want to sell to them, be it photo book, calendar or just a four by six photo,” adds Liang.

Outside of the retail channel, HP has also allied itself with that heroic group, media owners, in its quest to drive a greater volume of printed pages through what it’s calling ‘web connected printing’.

“We work with the content partners… to bring the content basically directly to our customers. So without logging on to the PC or the internet, they’re able to pull the content directly from those content partners and print it out directly,” explains Liang.

“The strategy is driven internally and is very much based on the consumer insight that I shared with you, the four key trends that we see happening. Customers want to have the content in their hand…

“It was launched in North America one year ago, and we discovered that 70 percent of customers who bought printers with this functionality actually print out content from various partners, which is very encouraging. Because, having to be very frank, this is a very new thing; we didn’t know whether people would really print it, or if they wouldn’t use it… On DreamWorks they print out colouring pages and give them to their kids to colour in, and it’s much faster. So we think this is the trend to go, and what will make it successful is to enable our teams in the regions to engage local content partners that have the content that is relevant to the customers locally. So those are the directions that we’re working towards,” she continues.

“In some countries we are working with the country coffee chains to put our printers there, enabling the people who go to the coffee chains [to use them]. That’s what you’re going to see in other markets, including Australia. You will see our printers appearing in places where our customers are travelling, are living, are enjoying or relaxing rather than just in one space,” adds Ibrahim.

The enemy of my enemy

HP’s partnership/endorsement focus is actually indicative of a wider business strategy of acquisition. The brand has been a voracious acquirer, over the years buying up over 100 companies, including big names Compaq (for US$25 billion), Palm (US$1.2 billion), 3Com (US$2.7 billion), Snapfish, Mercury Interactive (US$4.5 billion) the aforementioned Indigo and, in 1958, importantly, FL Moseley Company, which allowed HP to enter the plotter business, plotters being the predecessors to certain printers. According to Fortune magazine, the brand now holds the best profit margins in the printing industry.

Ibrahim points to research from Gartner demonstrating businesses spend as much as three percent of their revenue on printing, once hardware, software, consumables, maintenance and support costs are accounted for. She goes on to reveal the brand has a 34 percent share of the Australian market – that’s a lot of three percents. At Dscoop, obviously speaking of specialist printers, it is revealed HP’s Indigo outsells all of its competitors, combined.

At the professional level, this is driven by the partnership philosophy. The brand consults its customers to reduce costs and optimise its offering. In Asia Pacific, the lifeblood of these customers is marketing collateral, making up 58 percent of the business, followed by labels and packaging (19 percent), photo products (13 percent) and publishing (seven percent), with DM trailing at a surprising four percent. And the region is increasingly becoming the lifeblood of HP Indigo – Chinese sales equalled US in 2010.

Dscoop is another means of partnering through a branded, essentially gated community and encouraging users to create the value of belonging.

On a consumer level, the aforementioned web connected printing and retail channel partners are the driving focus.

“It doesn’t mean that we are not focusing on our core business, which is selling the printer itself, but we want to make sure there is no longer a box that sits in the study room or in the back room. It’s something that can enable the customers to connect to the content they want,” says Liang.

Leaning against the wind, HP believes digitised content hasn’t strangled consumer desire for printed content. Rather it’s a case of removing barriers and personalising that content. A study HP commissioned across Asia Pacific found that 75 percent of customers in possession of a smartphone, or related mobile device, want to print from it. The solution? Give printers their own email address.

“So if I want to print something to Jacqueline from the printers that she owns, as long as I know the email address of her printers, I can print directly from my smartphone, all kinds of smartphones, to Jacqueline’s ePrint enabled printers,” say Liang.

“Our fundamental strategy is to convert analogue pages to digital and to enable new types of digital pages. We’re especially focused on high-value pages such as colour and variable data,” adds Ibrahim.
“Because of all these changes, the way we do marketing is also very different. So gone are the days that we only do product launches and that we just tell them all the product features and the benefits. We truly want to move into the customer’s experience, dialogue and discussions. It’s a lot more interaction with the customers that we want to generate. So you will see a lot more marketing activity, not just at the advertising level, but more… at places, physical places where our customers live their life and consume that content,” proselytises Liang.The brand believes it can move the printer out of the office and into the centre of the household as a content generator of sorts.




Technology brands don’t do a lot above the line in this country. When it comes to personal computers, we tend to sit in camps by operating systems divided: you either back a fruit or that rich guy. And that’s really determined by personal situation, influenced a little by word of mouth and viral content.

HP’s decommodification in markets the scale of which justifies it, is elegant. But the brand’s pre-emptive defence of its bread and butter, printed pages, is an unexpected mirror and ally to traditional media’s own challenges. Those partnerships may be an inroad to influencing consumer decisions in smaller scale markets beyond allegiances to Seven or OS X, black or aluminium, John Hodgman or Justin Long. Those partnerships will likely prove more important than the omnipresent ‘four trends’. And I’m sure HP knows it.

That bearded prophet Benny Landa put it best for him pulpit in Seoul: “The best deal isn’t the one that looks best at face value, but the one that makes the other person believe they got the best deal.”

What Google is trying to tell us

Focusing on future markets

The 28th of May this year might end up being one of the most
influential 24-hour periods in web history. It was on this day that
Google launched a new communications platform called Google Wave, and
if Wave lives up to its promise it may change digital communication
forever. While the web elite are all abuzz about the impact of
this new platform on the way we communicate, Google has quietly been
releasing a steady stream of new products and further improvements to
their core product, the search engine and its related
advertising tools. Google is not going to give us a roadmap for what
this all means, but it is possible to look at the patterns and take a
long view.

The search landscape

There has been a lot of talk about the new kids on the search block, Wolfram Alpha, Twitter search and Microsoft’s latest entry, Bing
(which could be an acronym for But It’s Not Google). Some commentators have
been speculating that many of the additions to Google search pages,
such as the new options area where there is real-time search among
other features, are Google’s answer to real-time search on Twitter
search, and the decision engine promised by Bing. And while competition
has undoubtedly accelerated Google’s release of features, it is a pretty
safe bet to assume that Google is not simply being reactive.

Google owns over 70% of the search market world wide. Wolfram Alpha is designed as a computational engine
which, in plain English, means it is an attempt to create a type of
artificial intelligence and tease data out of the internet in a
different way. Not really a direct threat to Google – in fact it can be
seen as a complementary feature. Twitter Search is a real-time search
engine based on the collective conversations of every Twitter user.
Interesting but also not a huge threat to Google search. Bing, combined
with Yahoo, is really the only direct threat to Google. And, while
Microsoft and Yahoo are spending a lot of money on marketing, they have a long way to go.

Google products are everywhere

Currently Google has something in the vicinity of 200 applications and services available (for a full list see here),
most of which are free. New ones seem to be coming out on a weekly
basis. A few weeks back we saw the release of Google Squared, a very interesting research tool with loads of potential. A visual search tool for news, Flipper, is expected shortly. And recently Google announced that will be launching a new operating system.

It is fairly common knowledge that any technology Google develops is
directed at increasing the usage of the web as a whole, thereby
increasing the value of it’s main revenue stream, AdWords, the advertising medium based on relevance and consumer intent.

Forget eBay, AdWords is the world’s biggest auction! Every single
search that is performed on Google is automatically analysed so that
the most relevant sponsored link is displayed on the page and, of
course, paid for by the advertiser. When you look at the cost of an
individual click the numbers are small. But when you analyse the volume of searches that are performed it really starts to get impressive. Enough to net Google USD $21 Billion in 2008.

The temptation is to draw the line there… “Google is trying to get us
all to use the browser even more, so we can do more searches, so they
can make more money”. This is true – but there’s more to it.

Ive seen the future and its thin

The big difference between using Google AdWords and say print
advertising – apart from the huge difference in volume of data you can
extract, is that it levels the playing field. You can be a
multi-national corporation with tens of millions to spend but if the
copy of your ad is less relevant to the searcher’s intent, than an ad by a
one-person shop you won’t get the top spot. It is this fact that has seen
online advertising for the SME market skyrocket. Naturally, Google is
well aware of this.

The web has become almost as
essential as electricity and water in most of the technologically
advanced areas of the world. In these societies the middle class are
the highest users. But Google has spotted that poorer, less advanced
countries present a huge growth opportunity. The current barrier to
entry for this demographic is the window into the net: the computer.

Much of the cost of a computer is tied up in the processor power and
the disk space. What Google is doing by creating free ’software as a
service’ applications (cloud computing)
is removing much of the technology requirement and cost. If all the
processing is done at Google’s end the client’s machine need not be the
latest and greatest computer on the market. The dramatic uptake of the NetBook
is a great example of this. And the sale on eBay of the first
generation of NetBooks for a few bucks presages the opening up of
entirely new markets.

This is all about taking everybody towards a ‘thin client model‘.
In this case the ‘client’ is the web end point – your window in the web
– be it a NetBook, a TV, a phone, or just a screen plugged into the
wall. The ‘thin’ part is the technology. Keep it simple and keep it
cheap. The idea of the thin client model has been around for a while,
but Google is doing the most to advance it for the general population.

Hold on – were about to take off

When the technology gets cheap enough, the new target market for search-related products will be most of the world. Google knows this and is already investing a lot of time into removing another barrier – language. One of the plug ins showcased
when they launched Google Wave was a language translator that works as
you type. This enables you to have real-time conversations with anyone
in the world. Together these innovations will bring information,
education, and wealth to the masses in entirely new geographies.

In short Google knows it has the lions share of the current search
market. They are now aggressively creating entirely new market – ones
that are potentially much bigger.

As marketers we shouldn’t underestimate the size of this
opportunity. Sure, we will have to learn new technologies and customs,
but we will also be able to market to entirely new groups of people
with a new range of needs and wants – a part of the world that will
grow in power and influence. If you thought the first 20 years of the world wide web brought a lot of change to the way we do things, you haven’t seen anything yet.

A recent Harvard Business Review article titled The New Frontiers
referenced case studies from around the world where companies are using
social networks and other web technologies to adjust their position in
the value chain.

Many firms are already engaging new markets and customers. Dont get left behind.