My advertising firm once persuaded a client to create hundreds of copies of a brochure at a cost of $250—each. That’s not a typo: They paid $250 per copy for a hardbound promotional piece about the size of tray table, which they hand-delivered via special courier to prospects all over the country, adding even more expense. We suggested that another company hire a notable musician to write and distribute a song rather than develop a traditional ad campaign. And we once persuaded a client to buy billboard ads that didn’t mention the company or even display its logo.
While each of these decisions clearly represented a creative risk, all three paid off. And it wasn’t just dumb luck. What looked very risky to outsiders was, to those in the know, a calculated strategy to enhance the brand’s position in the marketplace.
There’s a principle that holds true in every market: Risk and return tend to move in the same direction. If you’re considering a financial investment in equities, real estate, or even collectibles, you understand that the bigger the return you seek, the bigger the risk you must likely take. Conversely, if you can’t stomach risk, you’ll have to be satisfied with a lower return. The best portfolio managers find a way to maximize returns while minimizing risk.
The best brand managers do the same. New ideas are, by definition, different, and different is risky. Years ago, Pizza Hut (YUM) tested a holiday catering service by having its waitstaff wear buttons saying, “Invite me to your Christmas party.” Consumer engagement was high; in fact, there was a little too much engagement by some of the chain’s beer-bellied patrons. In this case, the creative risk turned into genuine risk for waitresses, and the campaign was quickly pulled.
That’s the thing about taking a chance—if something hasn’t been done before, there are no historical outcomes, no points of comparison, and no telling if (or how) it will work. But that doesn’t mean you have to operate in the dark when a new idea is put on the table. As with investing, the trick is to get risk and return moving in opposite directions. Here are a few ways to do just that.
Know what you don’t know. Warren Buffet once said, “Risk comes from not knowing what you’re doing.” He wisely (and repeatedly) advises aspiring millionaires never to invest in a business they don’t understand. Because we all watch TV, read magazines, and surf the Web, we think we know how branding works. But just as attending the Kentucky Derby won’t make you a jockey, consuming advertising has little to do with effectively creating it. If you’re not a branding expert, don’t jump on a horse you can’t ride. Get help.
Do your homework. In all three cases above, we had gathered detailed information about the audiences we were targeting. We knew the competition and the idiosyncrasies of the industries. And we understood the buttons we had to push, including how much each medium could play a part in communicating the message. Had we not done our homework, there’s no doubt the clients would have rejected our ideas. In fact, we may never have come up with the ideas (and would have been afraid of them ourselves) if we hadn’t been confident that we knew the customers we were targeting inside out.
Establish clear limits. Investing in a startup is quite different from investing in an index fund, with wildly different risk profiles and expectations of return. A well-balanced investment portfolio contains a mix of assets that reflect the objectives and risk profile of the investor. The same is true in branding. Our clients who agreed to risky campaigns weren’t betting their entire businesses on them. Each had a comprehensive, integrated marketing program in place, so they could afford to use some of their marketing budget to take a flyer on an unproven “startup” idea.
Keep your emotions in check. New ideas are always exciting and all about eliciting emotional response. But it’s how the ultimate audience will respond that matters, not how your co-workers, friends, or kids respond. We all tend to fall in love with our own ideas, especially when they first occur to us. Don’t rush to execute a thought until you’ve given it time to simmer, and seek honest critique from qualified people who will tell you the truth.
Don’t try to eliminate all risk. Risk can be managed but never controlled—you could break your ankle getting out of bed in the morning. The danger in most marketing communications is that they’re not risky (read: creative) enough. Old ideas are recycled, too much information is squeezed into too little space, or the sell is too hard, among many other mistakes. You may be wise not to bet the farm on an unproven idea but at least be willing to risk a couple of bales of hay on it.
Your brand is an asset, like any other asset, and its value can grow and diminish over time. Since new ideas are the lifeblood of brand enhancement, you can’t stick your head in the sand and avoid all risk of change. But by knowing what you don’t know, gathering all relevant information, setting clear limits, keeping your emotions in check, and taking calculated risks, you can enhance your chance of a big return.