Feasting on the future

At Wolff Olins, we’ve been thinking a lot about creativity and its role in the world. That’s why we were very excited to be invited to speak at The Feast. From the moment I walked into Pioneer Works, the expansive art space in Red Hook, Brooklyn, I knew The Feast would be special. After some early-morning mingling, the lights dimmed and a group of Feast staff perforated the crowd. They ultimately led us to the high-vaulted conference room where Jerri Chou, the founder of the Feast, introduced herself and the agenda for the next two days.

But The Feast is anything but a typical business conference. For starters, its goal of empowering individuals and small communities to use their skills to make the world better is hardly commonplace. Creative expression, innovative ideas, and a desire for social impact constitute a common thread among speakers and attendees at The Feast. Though this year and in the past, some have rallied to develop actionable projects for social good, the outcome for most is a change in thinking. It’s a belief that anything is possible; that we all are capable of changing the world.

As a speaker and workshop leader at The Feast on behalf of Wolff Olins, I was amazed by the way people reacted to what I had to say. I was discussing the Future of Money and how companies are beginning to acknowledge new forms of value such as personal data and online reputation. Those who attended our workshop seemed comfortable thinking about and discussing the future, as if it were their bread and butter. They took the workshop prompt – to build a business that trades in non-monetary forms of value – to new heights with their creative ideas. One person even lit their wallet on fire.

The connections I made at The Feast are sure to be long lasting, due at least to the fact that I would be hard pressed to meet a similar caliber of people under any other circumstance. People were truly engaged and enthusiasm was high. It felt as if we were all marching forward in the right direction. For anyone invested in building a brighter future, this would be a good place to start.

Money more human

We recently held our Money Now event, where we welcomed 15 senior leaders from the world of money to discuss the big changes occurring in the industry and the opportunities that arise from this.

The conversation was rich and varied with senior folk from a wide range of backgrounds, spanning fast growing tech start-ups such as GoCardless and Crowdbnk, through to more established online platforms such as Zopa and Nutmeg, as well as financial heavyweights such as Barclays and NewDay.

We were also lucky enough to hear the wise words of Luqman Arnold, former CEO of Abbey National and former Chairman of UBS, who stimulated the discussion with some rich insights on factors driving change in the industry, and who talked about his new venture, and breakthrough advisory model, CAN.

The discussion mainly centered around how the world of money and its role in people’s lives is fundamentally changing, powered by new technologies and a new entrepreneurial desire to side-step the institutions and help individuals take control.

This shifting industry has lead to a new ecosystem of money forming around the individual, with players fighting to embed themselves across people’s daily lives and be ever more useful to them. In short, the fight is for the individual and to give them the power they need to take control of their finances, rather than to keep this power to yourselves and try and manipulate the system and rates. 

The group discussed how a new generation of users (YZ) is growing up without a traditional banking relationship and demanding a new level of customer experience and service that is built around them. The group felt that empowering the user to take control of their financial decisions was the key to success in this new ecosystem.

The group argued that the key factors for winning in this new money ecosystem were to put the individual in control, making products and experiences simpler and more transparent; making these platforms more universal and democratic so everyone can use them; helping educate and inform people on how to manage their money (and credit) better; connecting these users to peer-to-peer communities to share ideas and make better decisions; and make sure these products performed well and were more useful in people’s daily lives.

The conversation ended on the salient point that technology gives financial players a unique opportunity to break down existing barriers and help not just the privileged few but the 5 billion unbanked across the world, with the financial products and advice they deserve.

So it seems that money still makes the world go round, but this time, it can be for the benefit of all of us.

Watch this space for the full Money Now report coming out soon.

Money talk

The role of money in our day-to-day lives has changed with far reaching impacts for both individuals and businesses.

A proliferation of new customer-centric services, business models and systems – enabled by new technologies – are changing the way we think about money and creating new forms of value.

How might these changes affect the role and character of brands in the financial sector and beyond?

We are conducting a series of global initiatives to understand what these changes mean. We’re inviting leaders from established financial institutions, disruptive start-ups, economists and other thought leaders  to build a shared picture of the Future of Money. 

Join us in San Francisco on 22 July, or in London on 18 September

If you can’t join us watch out for our report, which will share the findings from each region, creating a global picture of the shifts and opportunities that changes in money presents.

Reasons to be cheerful

by Robert Jones and Sami Mallis

There’s no industry that more needs to change its game than financial services – and yet that seems so unlikely to do it. This is not because of the conservatism of banks, but because of the conservatism of consumers. In many ways, it’s a justified conservatism – ‘don’t mess around with my money’ – and yet things could be so much better for all of us. Cash machines and credit cards revolutionised money in the 1960s. Since then, we’ve had great but relatively small innovations, mostly from smaller players. In the mainstream, little has changed. But there are three signs of hope.

The revival of ethics

Why do we still so mistrust banks? In the UK, only one in ten people say they trust bankers to act in their best interests, according to Which?  But one global bank is trying to do something about this: Barclays. Through its Transform programme, led by CEO Antony Jenkins, Barclays is shifting its culture towards making money ‘in the right way’. Employees who don’t accept values like integrity are told: ‘Barclays is not the place for you’. The change will take time, but it's certainly in earnest. And around the world, Islamic banks, like Noor Islamic Bank, are becoming a mainstream alternative. They don’t charge conventional interest, they invest ethically, and they share profits and losses. Ernst & Young predicts that Islamic banking in the Middle East and North Africa will double in size between 2010 and 2015. Expect more banks to take ethics much more seriously: but who will do it best?

The transformation of payment

Why do we still carry a pile of coins, and a stack of plastic, around? Here’s where there has been change, with online payment systems like PayPal, contactless cards, person-to-person payment devices like Square, and mobile systems like M-PESA. Square, for instance, now processes $41 million in payments every day. And we’re on the brink now of cashless, cardless payment, as our phones and credit cards converge with innovations like Apple’s Passbook, Google’s Wallet and AmEx’s partnership with Isis Mobile Wallet. Expect rapid change in the next couple of years. One brand will probably emerge as the standard: which one?

The modernisation of advice

Why is there still no big, branded financial advice service? Financial advice is a huge industry, and the demand is growing – yet it has shown few signs of entering the modern world. When people don't know which advisors they can really trust, alternative sources are doing well, often with a lot of peer-to-peer content. Moneysavingexpert.com in the UK reaches 13 million users a month. CaféMom is a successful forum on family financial issues targeted at mothers. SALT is a free membership programme from the non-profit American Student Assistance to help students manage their loans and take control of their money. These examples are promising, and expect much more. But which big brand will really grab the still-open opportunity for good, sensible, large-scale, mainstream financial advice?

  Robert Jones is head of new thinking at Wolff Olins. Sami Mallis is a marketing associate at Wolff Olins London. 

Image via SALT and American Student Assistance

Mo’ Money, Mo’ Problems? Not with Betterment.

By Ben Crane

At a recent Share in New York, Wolff Olins had the chance to meet Jon Stein, CEO, and Eli Broverman, COO, the cofounders of Betterment, a startup that wants to bring simplicity, design, and a dose of behavioral economics to personal investing and saving.

Disrupting your savings account.

So how does it work? First, a user easily transfers money between their checking account and the Betterment tool. Then Betterment invests the money across a diversified range of options.  Those options take into account a person’s net worth and income as well as modern portfolio theory. At any time, a user can adjust the risk that informs their investing strategy—if you’re more comfortable with risk your money can be invested in more stocks than bonds, and vice versa.

Jon and Eli, the duo behind Betterment, launched the company at the 2010 TechCrunch Disrupt, beating out 500 other startups to be named Biggest New York disruptor. Not bad for an SEC Registered Investment Advisor and a broker dealer regulated by FINRA and the SEC.

Betterment sticks out in three notable ways. 

-- First, Betterment’s design sensibilities are refreshing considering the cluttered and confusing user interfaces that populate many investing services. Jon describes this minimalist approach to financial services as “Apple meets Vanguard. 

-- Second, the cost of using Betterment is extremely attractive for anyone interested in growing their savings—there are no minimum balances, transaction fees, holding periods, or hidden costs. The only fee a user pays is a low annual management fee between 0.15% and 0.35%. To put this in perspective, the average mutual fund fee is close to 1.4%

Now, mind you, competitors can quickly emulate these two qualities. Banks can hire design firms to redo their website, and lean startups with enough funding can perform the same services for less. 

-- The third factor, and where this start up truly stands apart, is that it lets its users set goals which inform Betterment’s investing strategy. The ‘goals’ feature, implemented by Betterment after carefully listening to the feedback of their users, treats you like a human being, rather than a dollar sign. 

Let’s say you want to purchase a car in 3 years. With a few simple clicks to provide basic information, such as how much you'd like to save, you can quickly set that as a goal. Next, Betterment recommends an investment strategy for you, considering your total net worth, salary, and investment goals. Goals range from the specific—purchase a new $40,000 car in 3 years—to the more nebulous—retire by the age of 60. 

The purpose of money management is only superficially to make more money. At its core, the driving force of money management is to make more money to do things.Helping someone achieve their goals requires a deep level of trust, and a genuine interest in their circumstances. 

Users and brands can work together.

The recent scandal at JP Morgan Chase over the manipulation of the London Interbank Offered Rate, or Libor, is only the latest in a series of events—perhaps beginning with the subprime mortgage crisis of 2007—to deepen the distrust citizens feel toward financial behemoths.

Betterment thinks users and brands can work together to better each other’s lot. It is this sensibility, that a company’s value is evaluated not only by its bottom line, but by its social impact, that we take to heart here at Wolff Olins. Ultimately, it is this sensibility that will separate the game changers, from everyone else. 

(This is the fourth Future Patrol, a monthly series of macrotrend posts by WONY Strategist Emily Segal. You’ll see Wolff Olins’ established macrotrends called out with a hashtag.)

#Hyperloyalty 

I. What it is:

Loyal3, launching in May, is a new startup that enables consumers to buy shares of companies (really $10 fractions of shares) directly on Facebook, an idea CEO Barry Schneider is calling “the ultimate ‘like’ button.”

Loyalty programs have already become a focal point for incenting consumer behavior, creating personalized perks, and gathering consumer data. 

Loyal3’s move to put real stakes behind consumer engagement shows that loyalty is beginning to generate new revenue models. The #Hyperloyalty trend is about precisely this kind of consumer-focused shift from marketing to value creation.

Future Patrol predicts that loyalty programs will become an expectation for every brand –even in industries that have conventionally gone without them – with elements such as crowdfunding, branded currencies and extra perks for good social media behavior as key features.

  II. Some examples:

     FROM REWARDS TO MICROECONOMY

The line between jokes and innovation has become increasingly blurry. Virgin Holidays’ April Fools’ Day hoax, a branded currency with Richard Branson’s face on it, recalls a trend we discussed in Future Patrol’s #Funny Money post: loyalty and rewards programs are becoming alternative currencies unto themselves, with points that can be redeemed for nearly as many things as cash can.

 “Most large companies – from Starbucks to British Airways to Sheraton to American Express – are evolving their reward and point loyalty systems into digital micro-economies, complete with redemption and exchange between systems.” (Cayman Financial Review) 

EXTREME CONSUMERS

Frequent flyers are the day traders of this new economy.

“Mileage runners are the high-tech nomadic wanderers of the air. Predominantly male, generally obsessed with flying and miles, and typically employed in white-collar careers that involve significant business travel, they scour the web for cheap flights, phoning in sick or using vacation days to fly the longest itineraries they can string together.”

  GAMING THE SYSTEM

Loyalty programs – and games – are both about incenting customer behavior, and both use feedback loops and points to that end. But a loyalty system need not actually be a game to feel like one.

“Assembling a mileage run means deciphering complex fare rules and pulling together information from up to a dozen websites. It's an achievement that tickles the same satisfying problem-solving centers of the brain as a Sudoku puzzle, and always ends in the deep-rooted human thrills of travel and flight.” (Wired)  (“Frequent Flyer” documentary on Vimeo)

THE EMOTIONAL LANDSCAPE

Freedom is the best perk. 

“Designing programs with an overarching theme of "freedom" can instill incredible power into our initiatives.” …. “Not "freebies." But "freedom." The ability to do things, to make decisions, to enhance one's life, in ways that wouldn't otherwise be possible. The word is telling. Many elements contribute to freedom, and, yes, the freebie is one such element. Others include privilege, convenience, assistance, guidance, choice and ease.” (“Freedom: Perhaps the ultimate aspirational reward” Colloquy Blog)

  COERCIVE CURRENCIES

However, “freedom” is not the first word that comes to mind when integrating social media into loyalty schemes. Giving consumers deals or discounts because they have desirable social media influence is a marketing trend, but also can create a coercive situation in which consumers must forfeit deals if they want to preserve their privacy

+ Gilt Groupe provides extra discounts for users with high Klout scores

+ Amex / Twitter: The new Twitter integration lets American Express cardholder receive special offers by tweeting with a special hashtag. Initial partners include Zappos, the Cheesecake Factory, McDonald’s, Best Buy, Virgin America, and Whole Foods. In order to redeem a deal, you send a tweet with a hashtag and the offer is loaded on to the account. The credit appears automatically when the card is swiped. (Venturebeat)

+ Exchange systems like Pay with a Tweet, or Chime.in that exchange goods for social media “love” and personal data from consumers

+ Reputation currencies like Whuffie Bank (where you get discounts and rewards based on your online social reputation)

  III. What this means for brand: 

+ Extreme consumers and mileage runners have invented their own rituals around current loyalty infrastructures. There’s an opportunity for brands to leverage the subcultures that spring up around the way they architect their companies. What seems like extreme niche behavior today will likely be mainstream tomorrow.

+ Don’t become so seamless and ubiquitous that you slip beneath the convenience threshold. Failure and friction are important elements in building brand loyalty – and put the “social” in social media. Help your customers "play, fail, replay, achieve, succeed and progress” (LS:N). 

+ Brands that make customers feel free are powerful, but the feeling of getting away with something may be even more powerful.

(For more on rethinking value download Value-Creative: Change the Game)

Untitled watercolor by Ken Price

Your Money, Easy as Pie

By Melissa Andrada

The world of personal finance is unnecessarily complex and overwhelming. In November, I wrote about Simple, an up-and-coming startup that hopes to turn the banking industry on its head. This week I wanted to highlight a few other startups that are simplifying and humanizing the way we perceive and interact with money.

Venmo: Transactions Made Easy

Need to split up the restaurant bill? Need to write a check to your roommate for rent? Venmo makes transactions between friends fast, seamless and effortless. Add your bank account, and then start sending and receiving payments. Pay a friend back by simply replying with a text message or do it through the app. 

Betterment: Personal Investing for The People

My savings account has been collecting dust. For the past two years, I’ve gotten calls from my bank encouraging me to invest my money in a mutual fund.  The jargon, opaque fees, over salesmanship has led to inertia. Until recently.   

A couple of months ago, I stumbled upon Betterment, a new service that makes investing transparent, simple and painless. You don’t have to be a certified accountant to use Betterment; they translate the jargon and use normal, everyday language. You don’t need to have a lot of money to start investing; there are no minimum balances. Plus, you can make deposits and cash out whenever you want – without paying extra fees.

DailyWorth: Byte-sized Money Know-How  

Don’t have time to track Twitter or Facebook for money-savvy content? Subscribe to DailyWorth, an email newsletter everyday that provides practical tips, real stories and inspiring ideas to help women take control over their finances. 

Image by James Kape

Some ways to fend off growing pains

              Groupon, the daily deals provider, has generated so many customer complaints about how it markets its deals that it could face legal action unless it improves. Why? The portal maintains that rapid growth is at the heart of its problems - its internal processes and procedures had struggled to keep pace with its expansion. This is certainly not the first time a brand has become a victim of its own success. So, how can high growth businesses ensure that its functions keep pace with its growth? We put our heads together to come up with some advice:

Learn to say no: Just because you can doesn't mean you should. This sometimes means denying the customer for a bit. Yeah. Heresy. The 'customer' is not an excuse for treating suppliers poorly, being underhand, or pursuing a business model that is actually inherently unsustainable. Decide what you are going to suck at: Nobody is world class at everything. It's a mistake to try to be. For Groupon, striking fair deals and marketing with integrity would probably be the ones to focus on... 'Going public' means just that: If you want to be treated like a big adult company, don't expect to get let off because you've had to grow up fast. Make sure you'd be happy if everyone knew what you were up to. Adverts that make light of Tibet and unrealistic offers probably won't cut it. And if you want to hear a little more advice for businesses on this issue, we just published 10 Tips To Cope With Rapid Growth in FreshBusinessThinking.com.

(Wolff Olins London staff)

Image via H. Armstrong Roberts

Is the Goldman Sachs brand broken? Not yet.

By Charlie Stott

Brand is bigger than one man. In Goldman Sachs’ case, in fact brand is bigger than two men and a vampire squid.

Greg Smith’s open letter of resignation; Lloyd Blankfein’s tongue in-cheek comment that he is “doing God’s work"; and Rolling Stone’s assertion that the bank is a vampire squid wrapped around humanity, sucking the blood from anything that smells like money; have all so far given the bank little more than cause for concern. But why?

Plain sailing for now

Great game-changing brands share something in common – a strong, driving purpose. Brands like Virgin Atlantic, IKEA, and RyanAir all have a clear sense of purpose, which guides the business and is attractive (or at least relevant) to their customers, employees and suppliers. Goldman Sachs (GS from here on) is a brand with clear purpose - it creates wealth for its employees.  Wealth that attracts the smartest and most ambitious talent in the world. This purpose appeals to GS clients because they anticipate the smarts of GS will discover new ways to make money for them too.  And so long as the bank’s clients believe in this link, stories and allegations like Greg Smith’s will continue to be storms in teacups. It’s not all plain sailing however. This constant chipping away at GS’s reputation is beginning to impact the employees where it matters to them – in their wallets. The zeitgeist, fed by energized doe-eyed youth, is demanding better regulation (won’t work), moral responsibility in banks (never happen) and feels that morally bankrupt organisations (aka Banks like GS) don’t represent them.  Small beer, since most instances they’ll never be prospects or clients of these banks.  

But what happens when this poor reputation begins to impact GS people, as individuals?  On leaving the bank, it’s going to be harder for a GS employee to land a plum non-exec or heavy-hitting public sector role. Furthermore, any company they set up will be under increasing scrutiny and skepticism (e.g. Ocado?). This is a shame because today’s world needs people with the GS smarts.  It just doesn’t need any sniff of satanic or charlatanic behavior.

Consider the risks

So, is this brand broken?  Not yet. But the risks to GS are that its clients start to turn on it, that it begins to encounter problems dealing with various governments or that it starts to lose its talent. 

At the moment, the brand still works for GS's clients – it’s still associated with the smartest people in finance – but again, it’s short term. And right now, it works for employees. Despite what the public thinks, it's still the place the smartest people in finance want to be. But will they continue to work for an organisation whose reputation taints their future?

But the brand isn’t working for investors as hard as you’d have expected.  Reportedly, $2bn dollars were written off GS’s market cap after Smith’s resignation – but bounced back the next day – after investors were reassured that clients weren’t leaving.  Investors will have them on their watch lists.  But, ever seeking a deal, watch for folks going short at the next PR hiccup.

If Goldman Sachs were my client

If I were a GS client I’d want assurance that my wealth and my interests were being handled properly. But if GS were my client, what would I advise?

The first thing would be to advise against knee jerk reactions to media – this is not an institution that needs a public rebrand (yet) – it does however need to bond with its clients and its people, fast. Second. GS must know the facts on the impact and implications for clients. Find out if they have been affected and if they have, act decisively: reimburse, re-advise, change teams, get rid of people, change the incentives and reinstate long-termism.  The key is to engage clients, reinforce the success and focus everything on them.  And when the presses roll with the next bad story – be ready to talk to them immediately. Third. Understand the implications for your people. Check the culture at all levels, what needs to change? Encourage people to speak their mind, clarify the grey line between dishonesty and self advancement, contribute to a discussion on risk and ensure you’re not limiting their actions. Beyond this my advice would be to espouse your beliefs.  Stop the puffery like the 2010 adverts but be brutally honest, say something with integrity and honour. And if what you say will continue to grate with the public (i.e. we’re here to make money for ourselves and our clients) then have an adult-to-adult conversation – explain you’re not the regulator – tell the industry truths. Give your people a platform to show their selflessness and how they go on to create good things in the world (once they’ve filled their trousers for the lifestyle they want).  I consider it completely appropriate for GS not to have an enormous PR driven CSR programme - the causes it does push have an economic rationale relevant to the GS brand. 

GS's brand is about enabling individuals to do what they want, it creates the ‘can do’ culture and attitude and like it's clients, it lives with the flip side of this – arrogance.  GS shouldn’t try and find a cause everyone can buy into and marshal them into delivering it– rather, it should be a platform to allow the smarts at GS to do what they do best. Having said that I’m unconvinced that a purpose based on 20th century capitalism will carry their brand back to the status they once enjoyed – essentially being the B2B equivalent of Apple.  IBM hit it right with their ‘Smarter Planet’ programme, a purpose that guides the brand and resonates with the wider public.  Let’s see what the smarts at GS make of it…

Charlie Stott is a Senior Strategist at Wolff Olins London. For more of his thinking on Goldman Sachs, watch him on Reuters here.

Image via Shine, Michael Riley, Curtis Hanson

Detergent$ and other new currencies

Thank you PSFK and The Daily Beast for pointing us to two new currencies we hadn't heard of.  One is called the "Nanto" and the other you might recognize from your laundry room. 

No Money? Make Your Own

A French city called Nantes, population 300,000, will soon introduce its own virtual currency to complement the euro and encourage trade between its small local businesses. By next year, participating businesses will be able to pay or be paid in something called "Nanto." 

Accelerated by the financial crisis, Europe has seen a trend of small businesses looking to make more cashless exchanges. The WIR cooperative bank in Basel, Switzerland is already using a similar cashless payment system, but this is the first time a large European city is trying the experiment. 

see also: Future Patrol (Wolff Olins Macrotends) #Funny Money

Thieves Discover Liquid Gold

Tide laundry detergent has become the item to steal. According to reports in The Daily, NPR, and The Daily Beast, Tide's recently become a major target for thieves from New York to Oregon, who are using it as a type of street currency because of its steadily high retail price. According to Planet Money, Tide's street re-sale is anywhere from $5-$10 a bottle. It's unclear if people are trading it for other goods, as well as cash. 

While it's hard to find hard data on this "trend," there are loads of good anecdotes on the Web. For instance, one man in Minnesota stole $25,000 in Tide over 15 months before getting caught last year. It's apparently enough of a problem that CVS is looking into special security measures to keep Tide on the shelf. 

So why Tide and not Wisk or Seventh Generation? According to The Daily it's all about brand recognition, both in the store and on the street. "Police say it’s simply because the Procter & Gamble detergent is the most popular and, with its Day-Glo orange logo, most recognizable of brands."

Images via WorldCrunch and The Daily

Capgemini’s recent repositioning is even more evidence that even the most conservative companies are wising up to “social” or purpose-driven business – a massive pattern we've been charting

Virtually Real

By Dan Zuzunaga

Remember the future?  Or at least the future of commerce?  Always Open. Always On. Always Available. E-commerce was going to take the place of the so-called brick and mortar stores providing the consumer with convenient and immediate solutions to all theirshopping needs.  Want to shop at 3am? No problem.  Want free shipping? No problem.  Never want to deal with a salesperson again? No problem.  

   When Apple opened its Itunes store we logged on and between 99¢ songs and P2P file sharing sites record stores closed in droves.  We were amazed whenAmazon moved past books into things like garden tools, and people started buying things like rakes online. When Gilt launched lunchtime turned into a mad race of who could get it, (whatever it was), into their "member cart" first with fashion conscious shoppers huddled around their laptops everyday at noon.  

In the last 20 years E-commerce has delivered on much of its promise and for a format that is still young enough to be constantly reinventing itself it represents a sizable portion of the market, with a share that is growing year after year.  So it’s interesting to note that one of the biggest online retailers, Ebay, is continuing with a new approach to the future of commerce this season. Ebay, with the expansion of its holiday pop-up stores into 12 cities, is joining what is probably the second biggest trend in retail, the Experience Economy.  The newest edition of Ebay’s pop-ups is the new Jonathan Adler designed “E-Bay Inspiration Shop” a series of shopable windows that opened in late October at 404 Park Avenue South in New York City.

The Experience Economy lives at the opposite end of a point-and-click spectrum focusing on immersive multi-sensory customer experiences that happen in the store.  While Amazon and the like have been making shopping more convenient to do in your underwear, traditional retailers have been inviting us to spend more time out-and-about, or rather in their stores.  From 300,000+ sf Bass Pro Shops with shooting ranges for "Jr. Hunters" to Gucci’s Artisan Corner where well-heeled customers can watch Gucci artisans in action as the brand “transports the craftsmanship of Gucci directly to a store near you”, the Experience Economy has been busy reinventing retail as entertainment for the last 20 years. 

Traditional retailers have long acknowledged the need to incorporate e-commerce into their strategies Ebay's continued foray into brick and mortar is becoming a large scale investment by an online retailer into the world of brick and mortar.  To be fair the approach Ebay is taking with is more marketing than business model, this year Jonathan Adler designed “shopable storefronts” join the portfolio of Ebay stores.  Nevertheless as these retail mega-trends continue to merge the space between the virtual and the real becomes smaller.

Dan Zuzunaga is Senior Strategist at WONY.

Parts and Labor

By Alex Keith 

This October, a report was published by McKinsey estimating that the Internet has contributed more than a fifth of the GDP growth in mature economies over the past five years. That’s remarkable, especially at a time when these economies are struggling to get their populations back to work––producing and consuming the domestic product. So if the Internet is our ace in the hole for economic growth, and you and I are the prospective producers and consumers of the product in question, let’s take a look at the situation in front of us.

Arguably the biggest shift that has dominated the Internet in the past five years has been the move to make production and consumption a socially engaging activity. The consumer’s evolution into the participant dovetailed nicely with blogging and was a logical extension of niche communities that grew out of file-sharing, web forums and even chat rooms. The main difference, however, was that this new consumer/participant hybrid quickly began to feel its own weight when it came to creating external value, being made aware of this socially––not financially––by other people linking to and liking our stuff. 

So how does any of this affect GDP? Well, the ideal scenario for a growing GDP is a society in which the producers make an increasing amount of money by creating products for consumers to buy at increasingly higher quantities or prices. Since, on the domestic front, the producer is effectively the same as the consumer (we all buy stuff with the money we get from making stuff to buy), the Internet’s current social dynamic is strikingly lopsided. Producers are perceived as consumers (check), but producers are not being compensated enough--or even at all--to actually become the consumers needed on the other side of the equation. Liking this post would be nice for my social stature, but it won’t literally pay me and therefore motivate me to consume whatever advertising is targeted alongside it. 

This actually has serious implications. I’d encourage anyone highlighting income inequality within mature economies to assess the market value of their own production and demand a fare compensation from the social networks currently distributing it. And while that may sound a bit far-fetched today, there are a handful of companies identifying the economic imbalance between producer and consumer in this current climate, and offering their prospective participants a share of the revenue they generate. That should be a relief to all of us congratulating the Internet on its current 20% contribution to the GDP and wishing it many happy returns.

Alex Keith is on our account management team in our WONY office. He is a cofounder of the menswear label General Assembly.

Simple: Future of Banking?

“Banks got bailed out, we got sold out!” is a common rallying cry among the Occupy Wall Street protesters. The deep-seated dissatisfaction with the current banking system has led to a public demand to create real change within the industry. It also points to a major question: how can you innovate in a way that empowers consumers?

BankSimple, now called just Simple, is an exciting possible answer to this question. It opened its doors to its first round of customers this week. Many of us at Wolff Olins are fascinated by the innovative possibilities Simple offers and its potential to turn the banking industry on its head.

Rather than imposing its own system of doing things, Simple is built on people’s existing relationship to and behaviors around money.

Everyone knows that they should keep track of their balance, save money and plan for the future, but how many people actually do it, and do it well? Diet! Quit smoking! Resist that new iPhone! It comes down to making better choices, but we all know temptation is huge and change is difficult. 

In some ways, the current system of banking is incentivized for people to fail. As CEO Josh Reich puts it in Fast Company, “Banks make the most money when you make mistakes.” Navigating the banking system is often an intentionally confusing and opaque process.

Behavioral economics tells us that businesses shouldn’t coerce or tell people what to do, but rather create an environment that nudges people to make better decisions. Simple creates an architecture that helps people make better decisions about their money. 

What Simple does is translate the numbers and jargon into meaningful, everyday terms. Instead of just laying out your “available balance” and “actual balance,” it tells you your “safe-to-spend balance.” Their insight is that the top reason people check their account is to see if they can actually afford to make their next purchase.

In a Fast Company article, Simple Creative Director Bill DeRouchey says, "We do that math for them. Our UX philosophy is, let's do all that stuff – let's make it nearly impossible for you to fail with your personal banking."

It takes the personal finance dashboard of Mint to the next level.  As an alternative to traditional banking, with FDIC institutions as partners, Simple doesn’t only aggregate your existing bank accounts into easy-to-grasp infographics, but also acts as a trustworthy agent that legitimately seems to have your best interests at heart.

Occupy Wall Street and Bank of America debit fee fiasco demonstrates a deep frustration with – and skepticism of – the status quo. A banking alternative that empowers customers to change their behavior and achieve their money goals may be one part of the solution. In order to survive in the future, traditional banks will need to vastly innovate their offer in a way that puts the customer at the heart of it. 

(Melissa Andrada @themelissard)

Melissa Andrada is a brand and content strategist at Wolff Olins New York. 

Making it real

I spent Tuesday evening with 2500 women as a guest at the Deutsche Bank ‘Women in European Business’ (WEB) conference in London’s Barbican Centre.  It was the 10th anniversary of the forum in the UK and forms part of a platform of annual events around the world that Deutsche Bank hosts for women in the financial and professional services community spanning New York to Singapore.

Deutsche Bank have established themselves as thought leaders in the financial services sector where the proportion of senior female executives in top-tier management remains woefully low.  They’ve done this by making a serious investment and a very public commitment across the world to their stakeholders in hosting these public events, and have made it clear that the question is not about ‘fixing women’ but providing them with the right support and perspectives in order to navigate their way, in much bigger numbers, to the boardroom.

The theme last night was ‘Leadership in a New World Order’, exploring the ways in which leaders drive change in an organisation and how leaders need to adapt to the re-balance of economic and political power globally in order to stay competitive.  Putting thornier geo-political arguments to one side, two central themes that emerge in this new world order are: connectivity and adaptation.   Connect or die.  Adapt or die.

From a brand perspective there is no question that Deutsche’s engagement with this high flying group of women has had an impact on its employer brand and has generated substantial goodwill.   Over the last decade, they’ve successfully moved these conversations on from the banal and created a highly connected group of like-minded people who are effecting real change both inside Deutsche and within the financial and professional services community.

The problem, however, is that they haven’t moved on with their own thinking in how to take advantage of this forum for real business benefit.  There’s no follow-up, no mechanism to communicate and extend the debate post the event, or to engage with individuals to do business with in the future.  There appears to be no vision as to how to turn this into a differentiating initiative that actually drives their business and adds to the bottom line. Deutsche Bank has worked hard to lead a stagnant sector into new thinking on gender balance.  I’d really love to see them take that to the next level and connect it with real business benefit.  They’ve got the connectivity bit right, now it’s time to adapt or die.

(Rebecca Matts)

@msmatts

(Skate)boardroom

18.5 million participants 

 5 billion dollar industry

sport / art form / lifestyle / illegal

Skateboarding has inspired generations of youth to quit organized sports (football for me) in favor of the revered skateboarder lifestyle. A lifestyle that includes a worldwide community of 18 million people wrapped in a 5 billion dollar industry living in a world that has deemed it illegal in almost every major city across the globe. This brings up some interesting questions, how can something as simple as a piece of wood and four wheels become the third most popular "sport" in america, after football and basketball, without widespread support from the general public? One answer is skateboards' ability to maintain a D.I.Y. approach in much it does, from it's birth from hack-sawed roller-skates to illegally built skateparks that force the city to re-zone (shout out Portland, OR), to companies started in someone's basement, skateboarding supports individuals acting on great ideas, not just groups or organizations. The Berrics happens to be one individual's extra great idea, and may provide some inspiration for those of us that don't skateboard.

The Berrics is a private indoor skatepark in downtown LA conceived by Steve Berra with help from Eric Koston. It is also a website found at www.theberrics.com that chronicles skateboarding and events that happen at the park. Started in 2007, the website exploded from relative obscurity to now receiving more than 6 million visitors and 20 million page views per month. What makes The Berrics so unique is not it's design (which is a bit questionable at times) but rather the role it plays within the skateboarding as a media outlet and digital "community center". A combination magazine, skate video and TV channel, wrapped in a blog, delivering completely unique content daily. It has started a worldwide skateshop organization called Berrics Unified, through online contests it has single handedly discovered some of the best skateboarders in the world and pushed them into professional ranks, It has invented skateboard games and coined catch phrases, utilized text messaging in fantastic ways, educated the masses on  skate fundamentals and always delivers the very best skateboarding by professionals from all over. More than anything else it seems to be a giant think tank, experimenting in the real world with ways to engage the public digitally, create dialogue and promote creativity both on and off the skateboard. 

For us, working in an industry that feeds off of creativity and experimentation a lot can be learned from The Berrics. The whole project proves that many ideas can be created from one great idea. It's a reminder that not everything needs to be planned to a "T" and things should have room to grow organically. Steve Berra created one of the most recognizable skateboard "brands" in the world seemingly by accident. No strategy meetings, no design overhauls, just a simple idea and the drive to bring real skateboarding to everyone that wants it.

(Calvin Waterman)

Photo courtesy of www.theberrics.com

Creativity beats cash (even in fashion)

Back in the days when I was running a jeans business, every 6 months we would take part in trade shows.  This was where you would ‘set out your stall’ and all of the cool stores would come and place their orders for next season.  Our first shows ever were Coterie in New York and Project in Las Vegas. 

The scale of these shows was incredible and Radcliffe was up against some of the richest denim brands in the US – opposite True Religion, who had built the equivalent of a western saloon bar, down the road Seven had recreated a Los Angeles Penthouse and Earnest Sewn I think had built an entire log cabin.  Everyone had also spent a great deal on amazing models and imagery. 

 How was  a small British brand to compete?  We had no money to build a trade stand, so instead creativity triumphed over budget.  We found a beautiful photo of an English drawing room with windows looking out onto an English garden in full bloom, bathed in sunlight (we were selling spring summer).  We blew this up into room size wallpaper and lined our trade stand with it, recreating effectively the drawing room of an English stately home.  Anyway, it was very cheap and simple, but all the buyers were very enchanted...

I was reminded of this when I was looking at these 2 brilliant retail concepts.  Both are clearly inexpensive but absolutely beautiful.  The first is the Trading Museum from Comme des Garcons in Tokyo – the only shop fittings are display cabinets from the V&A – filled with CDG products.  I will admit to being a bit of a display cabinet addict though...

The second pictured is a pop up from Aesop at the Merci store in Paris, in place for 1 month.  Again, super simple, lots of brown boxes with Aesop on them contained within a fishing net.

(Suzy Radcliffe)