Lean Planning for Nimble Agences - Mirren New Business Conference 2012

transcript

lean planning for nimble agencies

Mirren New Business Conference2 May 2012

@farrahbostic

Stuff I’ve done.ads

campaignswebsitesgames

strategiesbusinessesproductsmedia

hosting hackathonsmentoring start-upswriting a little code

presenting an absurd number of decks

“Lean” is hot right now

http://theleanstartup.com/

It’s a reaction to waste, superstition, and bias.

Requirements

Design

Implementation

Testing

Maintenance

The traditional software

waterfall model

Full management teams

Assuming the customer is known

Assuming the features are known

Assuming growth happens by execution

High burn rate

Swinging for the fences

The results for start-ups:

Principles of Lean Start-ups

Assume customer and features are unknowns

Continuous customer interaction

Revenue goals from day one

No scaling until revenue

Low burn by design, not crisis

Google #Firestarters: Agile Planning

Do Agencies Need to Think Like Software Companies?

Let the stealing begin...

Fact: It’s easy to talk about “lean”.

It’s hard to be Lean.

http://www.youtube.com/watch?v=3J9KhpgYVB0

Lean Pirates & Agile Ninjas talk about

‘pivoting’ a lot

Pivoting isn’t a goal.It’s a necessity.

It happens when you’ve done all you can with the 1st idea.

And you make the intuitive leap to a better one.

Where does this intuition come from?

Empathy • Discovery • learning

Measure

why nimble agencies aren’t agile

the ‘insight & creativity’ waterfall

Client Briefing Planning

Creative Briefing Creative The Sell

PROFIT?

Research

Testing

MediaProduction

Accounts

Planning

Creative

this looks like a time-consuming & expensive process, right?

in the race to win & keep clients,

we make 5 key mistakes

we take orders

Agencies facilitate and manage the production and placement of advertising on behalf of their clients.

The client asks, and she shall receive.

“we don’t get paid to think”

The traditional model:

Billings = The total cost to produce & place advertising

Revenue = ~10% of billings

Profit = ~15% of revenue

it’s hard enough to keep up with our own industry...

Clients Consumers

Ad AgenciesMedia

Agencies

Production Houses

Publishers

let alone our client’s

Businesses Growth

Consumers

CompetitorsPartners

Shareholders

Regulators

our process is wasteful

Client Briefing Planning

Creative Briefing Creative The Sell

PROFIT?

Research

Testing

MediaProduction

Accounts

Planning

Creative

our hand-offs can be more like show-downs

“I don’t need any more ideas. We’ve got plenty of ideas. I need to know what to make.” - Anonymous Creative Director

we tend to think ideas ‘just happen’ 4

WE EXPECT THIS GUY TO BE A GENIUS. EVERY TIME.

we’re struggling with product-market fit

“What do you want from me? Fine writing? Or do you want to see

the goddamned sales curve stop moving down and start moving up?”

- Rosser Reeves

WE BET ON A HOLE-IN-ONE. EVERY TIME.{BUT WE’RE NEVER SURE WE MADE ONE.}

so. that’s not working.

http://www.rswus.com/survey/2011-survey-clients-look-ahead-at-agencies

hired for lots of ‘reasons’...

...fired for only a few

Bad strategy, bad creative, bad service.http://www.rswus.com/survey/2011-survey-clients-look-ahead-at-agencies

how do we fix it...

three reality checks

Client briefs are not to be trustedthey are often disconnected from the real business objective, and assume facts not always in evidence

Our business model is double-sidedwe have to design for both our economic buyer (the client) and our end-user (the consumer)

Strategy isn’t (solely) about research and testingit’s about efficiently seeking a campaign model that scales - and this doesn’t have to be expensive or delay ideas

Principles of Lean ad agencies

Assume the client briefs are hypotheses to be tested.

Continuous customer interaction - with both client & consumer.

Establish clear goals for the campaign from day one.

Start simple, iterate on successes and learn from failures.

Create right-sized, integrated teams, and use the right resources & tools as they are needed.

Keep score with clients, vendors & partners.

a note:

I open source ideas & models.

So all of the models & frameworks you’re about to see in this deck are in the Creative Commons.

Using them is not stealing my IP. Please use them.

Mahalo.

how to do lean planning

in 5 really hard steps

start with the business problemWhat is the problem your client is trying to use advertising to solve?1

start with the business problem

“How is their bonus calculated?”

“Who do you report to?”

“Who approves the work?”

“Who owns the budget?”

What is the problem your client is trying to use advertising to solve?1

start with the business problem

“How is their bonus calculated?”

“Who do you report to?”

“Who approves the work?”

“Who owns the budget?”

“What can we influence/change?”

“What is the business problem?”

“What’s the root cause of the problem?”

“Who owns the parts of the value

chain?”

What is the problem your client is trying to use advertising to solve?1

The client brief is just one input.

charge for strategy

Call it discovery, campaign planning, client roadmaps, etc.

Do the work to understand your client’s business (note: this is different from their ‘brand’).

Involve your client in this process - do stakeholder interviews, workshops, etc.

Don’t call it an add-on or suggest it as optional.

Charge enough that it looks like it matters as much as it does.

Connect it to measurement & KPIs.

they pay for strategy.just not from you.

Reason #1: They don’t think agencies do strategy - and if you don’t have a highly visible planning team, with a history of solving business problems, why should they?

Reason #2:They don’t trust agencies to be honest - they think you’re learning what you want to learn to make the work you want to make.

Reason #3:They believe in ‘best in class’ when buying agency services - but are constantly frustrated by the inefficiencies.

What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive?

Through which Channels do our Customer Segments want to be reached? How are we reaching them now?How are our Channels integrated? Which ones work best?Which ones are most cost-efficient? How are we integrating them with customer routines?

For what value are our customers really willing to pay?For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues?

For whom are we creating value?Who are our most important customers?

What type of relationship does each of our CustomerSegments expect us to establish and maintain with them?Which ones have we established? How are they integrated with the rest of our business model?How costly are they?

What value do we deliver to the customer?Which one of our customer’s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment?Which customer needs are we satisfying?

What Key Activities do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue streams?

Who are our Key Partners? Who are our key suppliers?Which Key Resources are we acquiring from partners?Which Key Activities do partners perform?

What Key Resources do our Value Propositions require?Our Distribution Channels? Customer Relationships?Revenue Streams?

Day Month Year

This work is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported License. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/3.0/

or send a letter to Creative Commons, 171 Second Street, Suite 300, San Francisco, California, 94105, USA.

if nothing else, it shows you care

collaborate to learn3

http://www.startuplessonslearned.com/

“We always have a vision that is clearly articulated, big enough to matter & shared by the whole team.

“Our goal is always to discover which aspects of this vision are grounded in reality & adapt those aspects that are not.”

This vision is the ‘brief’...

PLACE BETS:generate hypotheses before ‘finding insights’

About the customer.

About what matters to them.

About the customer.

About how they live their lives.

About the customer.

About what they desire or how we can solve a painful problem.

About the customer.

About what they desire or how we can solve a painful problem.

Get out of the building.4

do what, now?

Talk to people - not respondents.

Not a lot: 5-10.

Get the people you meet to introduce you to other people they know who do things a little differently.

Don’t use a “facility” - try to go to where they are when they use the product or interact with the category/brand.

Be nice and listen.

http://giffconstable.com/2010/07/12-tips-for-early-customer-development-interviews/

measure to succeed

You know the old adage...

“Half my advertising is working... I just don’t know which half.”KPIs aren’t making this better, most of the time.

http://anjalir.wordpress.com/2011/04/12/sxsw-in-retrospect-the-last-of-the-launch-and-leave-ems/

“You need to add value to people's lives, not just expect them to participate because you goddamn well asked them to.”

Mel Exon, BBH Labs

Learning.Understanding.

Empathy.

measure like a pirate“[Vanity Metrics are] numbers that make us look good

but don’t really help make decisions.” - Eric Ries, The Lean Start-up

Actionable (a.k.a. ‘Pirate’) Metrics:

Acquisition: users from misc channels come to site, landing page, widget, etc

Activation: users enjoy 1st site visit, "happy" user experience

Retention: users re-visit site multiple times

Referral: users like product enough to refer others referral happens via email, links, blogs, widgets, word-of-mouth, etc

Revenue: users conduct monetization behavior (e.g., buy, download, affiliate sale trackback)

Bonus round: do it again.

“It isn’t iterative if you only do it once.”

- probably one of the made by many guys

Measure

thanks.