SXSW attracts over 30,000 people from the technology, media, entertainment, and music industries all with the singular focus of thinking differently about the way we do business. With the sheer number of panels and keynotes, it is virtually impossible to soak in all the collective knowledge the conference has to offer, but we have done our best to summarize our top five learnings.
Takeaway #1: Brands must lead the shift towards purpose beyond profit
Patagonia is doing amazing things in the environmental and sustainability space. They care about the environment, and are modeling what a social good company can do. Their new CEO, Rose Marcario spoke on the SXSW panel “Why Business is Good for the Planet”, and talked about the importance of “giving purpose to the next generation.” Patagonia seeks to cultivate citizens, not just consumers. By producing the high quality products that create the least environmental harm, Patagonia empowers individuals to become more mindful about the purchasing decisions they make, and don’t make, as seen in their 2011 “Don’t Buy this Jacket” ad campaign.
Unlike many of their contemporary publically owned retail counterparts, Patagonia is a privately owned company and was built from day one with these with these values in mind. Although their founder, Yvon Chouinard, is no longer running the company day-to-day, his commitment to sustainability continues to be pushed down from the top. When asked what other public companies are doing it well, Marcario couldn’t come up with a single answer, instead answering with a few social enterprises Patagonia has invested in. Patagonia’s model is harder to pull off in public companies because they are entirely driven by the bottom line. “If profit is the only motivator, we won’t have a world to live in in 50 years,” Chouinard shared. With the current state of public distrust in government and big financial institutions, it is more important than ever for brands to step up and play a larger role in creating a legacy of both purpose and profit. Its no longer just an opportunity for brands to lead, it’s their responsibility.
Takeaway #2: Now is the time to engage your brand advocates
Take a moment to think about these facts: Word of mouth is 2x stronger than paid ads. Referrals have a 37 percent higher retention rate. Brand advocates spend 2x more than average customers on their favorite brands. Yet, only 20 percent of brands fully engage their customers in their marketing efforts. In the panel “Building an Army of Brand Advocates,” which our VP of Global Business Development, Amanda Levy, also spoke on, we heard from Abby Lunardi, Virgin America’s VP of Marketing, who showed how engaging their loyal advocates to fight on their behalf allowed Virgin America to enter the market at Dallas Love Field. Learn how they used Change.org during this campaign.
We are no longer in a world where customers are solely recipients of their brand. With the proliferation of social media and digital engagement, consumers will continue to be in the driver’s seat and dictate what they want to see from the brands they love. Moving forward, the brands that will thrive are those that engage their customers as ambassadors, defenders and evangelists versus shy away from them.
Takeaway #3: Advertising, as we know it, is dead
At the Mobile Marketing Summit at SXSW, Gary Vaynerchuk, founder of VaynerMedia, and B. Bonin Bough, VP of Global Media and Consumer Engagement at Mondelēz International, engaged in a heated debate about whether big brands and corporations can evolve from a traditional marketing model, to embrace new technology. Both agreed that the ad as we know it is dead (goodbye annoying banner ads). It is all about the depth of attention and contextual advertising, also known as native advertising. As Vaynerchuk has said in the past, “Saying hello doesn’t have an ROI. It’s about building relationships.”
So, how can big businesses adapt to thinking beyond just ROI and into creating more authentic relationships through their marketing efforts? Vaynerchuk thinks they can’t. “You let the big companies die.” Bough championed a slightly more optimistic view, arguing that culture can change, if it comes from the CEO and board. Regardless of your view, it’s clear that companies need to be poised to adapt to the future of advertising if they are in it for the long-haul.
Takeaway #4: It is time to re-consider terms like social impact and social good
Jean Case, CEO of the Case Foundation, led a panel on impact investing, exploring whether social enterprise organizations should be considered for the same VC funding dollars as their traditional startup peers. The panelists from the VC world warned against using the term “impact investing” at all, because it inherently means you’re different and won’t be treated the same. They advised social enterprises looking for funding need to first lead with an unparalleled product or service, and then do good. Warby Parker, for example, is first and foremost an eyewear company producing best-in-class products, but they are also helping those in need around the world.
Ironically, the panel itself took place in the “Social Good Hub” and was separate from the rest of the conference. We need to ask ourselves, is this sending the wrong signal? Are terms like social good and impact investing leading us farther away from the mainstream? In an ideal world, social good and good business will be synonymous, and all companies will strive to create great products that have an impact on the world.
Takeaway #5: When in doubt, include puppies.
Blair Cobb and Katie VanLangen are Directors of Business Development at Change.org.