18
Jun 14

Apple’s marketing rethink: not exactly a surprise

We all know that things are different in the post-Steve Apple.

However, there’s something about the current move to build an in-house marketing agency that’s really, really different.

Unlike previous changes, this one isn’t driven by Tim Cook.

It comes from a new place, deeper inside the company — from those who long played a part in Steve Jobs’ marketing machine.

The industry and the press seem to be surprised by this development. To many others, it’s a wonder it didn’t happen sooner.

A little background to start with…

THE BENEVOLENT DICTATOR

Though Steve encouraged debate, his dictator side made it clear that some things were not debatable. One of those things was the way Apple handled its marketing.

He set up two distinct areas of responsibility.

Longtime agency TBWA\Chiat\Day (Media Arts Lab) was responsible for major campaigns, including broadcast, outdoor and print. Apple’s in-house design group was responsible for the Apple website, Apple Store materials and package design.

Having separate duties, however, did not stop either side from having opinions about what the other was doing.

Some inside Apple privately criticized the work coming out of the agency, or had issues with its strategies.

But Steve protected his relationship with the agency, and the agency did the same.

HUMAN NATURE STRIKES AGAIN

When Steve passed away, his marketing process lived on. But few people imagined it would stay intact for long.

For when opportunity presents itself, human beings have a bad habit of acting very human.

Call it ego, ambition, a sincere desire to improve, or any combination thereof — suddenly there was a chance to “make things better.”

That chance came courtesy of a new CEO who basically said “This isn’t my area of expertise, so I trust you guys to do the right thing.”

Depending on your point of view, those words either opened the magic door — or opened Pandora’s box.

HOW THINGS CHANGE

Jony Ive was Steve’s design soulmate. There was no internal equivalent when it came to advertising. The agency was his Jony.

Of course, Steve had Phil Schiller and others as marketing advisors. But his relationship with the agency was special — forged through many years of history-making ads.

As much as the agency wanted Phil to be happy, the highest priority was making Steve happy.

So it didn’t take a genius to guess that when Phil became the marketing leader, the nature of the agency relationship would change dramatically.

As the new chief, Phil was veto-proof. However, he did not have the same level of taste as Steve. Nor did he have an emotional connection to the agency.

The agency’s magic shield had lost its power source — and the critics inside Apple gained a louder voice.

IS THE AGENCY INNOCENT?

Not to be too cynical, but nobody in this world is innocent. (I’ll spare you the list of my many crimes.)

In one way of looking at it, the agency is now getting a raw deal. After all, it’s been responsible for Apple’s greatest advertising moments, of which there have been many. It has an intimate knowledge of, and deep love for, all things Apple.

Seen another way, some of the agency’s chickens are coming home to roost.

Advertising is a relationship business. If the agency chose not to lavish the love on Phil, or chose to put someone on the front line who didn’t get along with Phil, it bears responsibility for that decision.

The details are unknown. Suffice it to say that a client-agency relationship is like a marriage, with its inevitable ups and downs. Even back in the “Think different” days, Steve was not above threatening to take his business elsewhere.

It takes commitment to stick together during tough times — and that’s something that seems to be running thin at Apple these days.

WHO NEEDS AN AGENCY ANYWAY?

It’s not unprecedented for a company to set up an in-house marketing group. It’s important to note, though, that great agencies offer advantages that are hard to duplicate:

Experience. Agency leaders, like TBWA’s Lee Clow, have been building powerful, beloved brands for decades. Just being in the same room with a person like that makes you feel smarter.

Strategy. Again, experience counts. Great agencies bring a fresh perspective to the table, discovering unexpected approaches.

Media smarts. A huge part of Apple’s advertising success has can be attributed to brilliant use of media. Smart thinking in this department gives Apple its presence.

Global vision. The TBWA agency network powers Apple advertising (media and localization) in dozens of offices around the world. It takes years to build a quality operation on this scale.

An independent point of view. Great agencies don’t just take orders. They dream up new ideas. They push back. They live and breathe the client’s business, but maintain an outsider’s perspective.

CERTAIN DOOM OR A BRAVE NEW ERA?

Big companies can make life hellish for agencies. Conversely, big agencies can make life hellish for clients.

The idea of a big company like Apple building an 1,000-strong internal marketing group might sound like the worst of both worlds.

But anyone who speaks in absolutes can’t be taken seriously.

Is it possible for Apple to innovate in marketing to the same degree it’s innovated with products?

Of course it is. The fact is, the creative people Apple has recently hired are highly talented and well respected in the business.

Just as Jony Ive’s designers thrive in the Apple environment, so might creative people and marketing pros thrive in Apple’s in-house agency.

My biggest concern is creative leadership.

Back in 1997, when Steve was just returning to Apple, he told me why it was important to have Lee Clow back in the Apple family. It was because of his talent, of course. But, as Steve put it, it was also because “I need someone with barnacles.”

His point was that anyone can hire brilliant creative people. Having a great creative leader, having that adult in the room with that extraordinary track record, was equally important to Steve.

I’m interested to see how Apple staffs up this mighty marketing machine, and to see the work it generates.

Apple makes the decisions, so Apple bears responsibility for the results.

I know I’ve used this quote before, but I repeat it here because it’s so perfectly appropriate: “The client always gets the advertising it deserves.”

We’ll find out soon enough what Apple deserves.

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  • Andrew F

    It’s been reported that Your Verse and the Pencil ad were created by Apple’s internal team. It’s also been reported that Apple has hired quite a few barnacle-clad marketing people.

    But your concerns resonate. Like an artist that begins to overthink, it can be so easy to lose perspective and go soft on yourself. I’d hate to see a company that’s as vital as Apple is in nearly every field it operates to go soft on itself in its public presentation. It would be sadly appropriate if the company were indeed losing its edge, but to me something like Signature portrays the company softer and weaker than it is. That’s unfortunate because it makes us look at the company under false terms. Apple is a caged lion, not a sleepy teddy bear.

    But generally speaking I think the perception of Apple’s marketing decline is terribly overstated. Just another fabricated media narrative that people are just supposed to accept. Apple has had lots of good work the last few years.

    Interesting too that we’re starting to see their TV ads coalescing around a very specific cinema-veritè style, epitomized by the Malick-ian Your Verse campaign. Their melodramatic Misunderstood ad to their delicate Music Everyday ad to the more energetic spunk of the You’re More Powerful Than You Think You Are spot all employ the same visual language. Like every other aspect of Apple, even its cinematic language has its own specific style! Perhaps this is a bit rigid-thinking but it’s an interesting and worthy experiment.

    Anyway, enough of my ranting. This is one of your most insightful pieces. I’ve said it before, but as someone who’s a dilettante in tech, it becomes wearying to read day after day the theories of extremely bright Silicon Valley pundits. It’s so refreshing to read someone who has lived and breathed his expertise, and can synthesize his hard earned knowledge into insights so simple even I can understand them! Thank you Ken.

  • nuthinking

    It looks to me that Apple marketing is already set in a pretty good, and consistent, direction (tone of voice, values, etc..). They will definitely need agencies to explore new directions when needed.

  • WFA67

    it seems to me that because the bar has been set so high by the great ads with which we’re familiar, producing something that feels ‘soft’ or ‘off’ (at least in the Apple sense) is too easy to do.

    At the same time, I wonder about the effect of younger people in advertising, and the changed culture they know better than I, perhaps producing ads pitched to a different value set. As an ‘old guy,’ for example, I could care less about all the ‘social’ stuff. But I’m not in the target demographic any more.

  • nuthinking

    Beats World Cup ad is also pretty epic. Definitely targeted to younger generations. That can’t be ignored. Which means I see it harder to attract the younger without fresh ideas from agencies.

  • Oransky

    Just as Phil is not Steve, James Vincent is no Lee Clow. Vincent’s email to Shiller in early 2013, comparing Apple’s situation to 1997, was a startling and gigantic misjudgment. Talk about a red flag in the relationship…

    Apple is well aware that finding another Lee Clow, or starting over with a new AOR, would be difficult at best. So they are spreading the work around and at the same time building a powerful in-house team. Much like other areas of their business, they are making sure they don’t find themselves with a critical hole in their marketing and creative supply chain.

  • bart

    Real Issue is Tim not saying NO to people and
    of course being not good judge of people.

    Carl Ichan is about to school him on Nuance.
    Beats is going to another.
    His email to Schiller to just taking his word
    and simply saying if we have to move we better do it now.

    Apple basically have put it self in a corner where only
    ad it do now is product showcase and feature.

  • exapple

    This really isn’t as big of a deal as people are making it out to be. Apple Marcom is roughly 600-employee strong, and the additional people to bring it up to roughly 1,000 are simply existing contractors being onboarded from the agency. This process started over a year ago and has more to do with talent RETENTION and cost saving than anything else. There has been quite a few defections from Marcom to Apple competitors, which without the golden shackles of RSUs (which only employees get), is hard to prevent. (BTW, when Marcom management gets wind of somebody leaving for Google, they are immediately escorted out of the building, and their badge is deactivated — ie., “don’t let the door hit you in the ass on the way out…”).

  • JohnDoey

    It’s Apple Store all over again. Apple needs to tell their own story because outside stores/agencies have failed.

  • Hamish

    Insightful as always Ken, thank you.

    Maintaining a long relationship with an agency has many benefits of course, but a level of complacency or fatigue can always creep in over time to stifle creative output, particularly if you don’t have people as clear headed as Steve Jobs and Lee Clow on either side to keep the fights contained and lead forward.

    From the reports I have read, Phil does not have that same strong one-on-one relationship with someone within the agency, which has led to a lot more uncertainty and frustrations on both sides. As you rightly pointed out, this is partly a failing of the agency for focusing all their attention on Steve in the previous days, but it also has to be a failing of Steve himself, for not enabling a stronger legacy relationship to build between other members of the team.

    Taking a lot of very smart creative people in house has great benefits, but it doesn’t mean that everyone will suddenly get along and be on the same page. There will still be fights and differences of opinion as there always are within creative environments – the key, as you say, is still creative leadership, which requires a strong minded person at the top. I also wonder how Angela Ahrendts fits in to all of this and if she will become more involved in Apple marketing…

    TBWA has done outstanding work with Apple, but it really was Steve’s agency. If Phil is not having the same connection with them, perhaps it is time to try elsewhere for a fresh set of eyes. I imagine he is looking very closely at Beats agency Ammunition among others, so there may be more changes on the way…

  • http://www.tumbleintopeace.com cbee

    Interesting point about Steve. You’d think that Phil would have learned from Steve over the years; surely he was aware of how Steve and Lee/Chiat/Day worked together. Different sensibilities, though.

  • Herding_sheep

    It’s not a matter of “learning” how Steve worked. I couldn’t go and have the same relationship with Steve’s family just by monitoring how he interacted with them. Phil is a different person. Besides, he shouldn’t “try” to be Steve Jobs anyway, he needs to be himself and do what he thinks is right. He’s been Steve’s marketing executive for well over a decade, he’s clearly not some chump.

    The relationships at TBWA worked well for Steve Jobs and his personality. But that doesn’t mean the same for Phil. Phil needs to work in a marketing environment that fits his style and personality. If he tries too hard to be someone he’s not, they’re just going to get worse results. So maybe the internal route works better for Phil. Apparently the iPad Pencil ad and Photos Every Day were done internally at Apple, so maybe he’s doing the right thing.

  • http://www.tumbleintopeace.com cbee

    Didn’t mean to imply that Phil is a “chump.” Like I said and you said, Phil has different sensibilities, tastes, and marketing understanding than Steve.