Welcome to the first in a series of interviews that will try to get beyond the buzzwords and spin of thought leadership and content marketing, and dig into what purport to be leading trains of thought in the branding and marketing field.
We will be interviewing notable brand practitioners, the CEOs of branding firms that invest in what could be called “marquee content.” While these proprietary research projects and reports are obviously intended to garner maximum exposure and attract inbound traffic, we’ll be challenging these branding leaders to dig deeper and explain what their key thinking truly represents, and why their perspective and findings really matter.
Our first stop: Siegel+Gale, and a discussion with co-CEOs, Howard Belk and David Srere about their core philosophy of simplicity, and the annual study supporting it, The Global Brand Simplicity Index. We encourage you to watch the brief introductory video, and then dive right into the entire interview.
Branding Mag: Exactly what is the simplicity index — and why does it matter?
David Srere: The Global Brand Simplicity Index is a piece of primary research that we have executed for six years. It’s quantitative research, fielded most recently in 2015, as a study covering 12,000 people in 8 countries in the US, Europe, China, India, and the Middle East. It measures consumer perceptions of leading brands and the degree to which they deliver simplicity in the experiences that they provide to their customers. It matters because we have found some very concrete benefits—three just off the top of my head.
Number one, in the study, 69% of consumers said they would recommend a company that delivers a simpler experience. Secondly, 63% of consumers are willing to pay more for products and services that are delivered more simply. And third, over the course of the last nine years, a portfolio of the leading companies that delivers simplicity has outperformed major industries by over 200%. Why it matters for companies is that simplicity pays. For many years, it made intuitive sense to us. Now we have a piece of research that actually proves that that is, in fact, the case.
BM: The survey seems to produce answers from your excellent corporate exemplars that only define simplicity as, well, being simple … easy to use, easy to understand. That certainly makes sense. But then you go on to talk about other factors, like the need to be transparent and honest, the need to make customers feel valued, you need to be useful. We hear a lot about those in general branding, but how do those relate to, and perhaps proceed from, this philosophy of simplicity?
Howard Belk: In creating and designing the survey, one of the things that we did first was conduct research on this whole word and idea of simplicity. What does it actually mean to people? Transparency. Honesty. Ease of use. Clarity of financial terms. Those kind of things are what people mean when they apply the word simple or simpler to products or brands relative to their competitors.
BM: Okay, in terms of innovative and fresh, those aren’t necessarily simple. There’s a lot of complex, useless innovation.
HB: Yeah. You’re right.
DS: This is a key point. At Siegel+Gale, when we talk about simplicity, there are really two dimensions to it. One is the kinds of things we’ve just been talking about – clarity, ease of use, efficiency. Then there’s a whole another dimension to simplicity from our point of view and that has to deal with surprise. Easy to understand, but surprising. When those two things intersect is when simplicity really generates maximum value. As you said, there are a lot of things out there that are clear and really boring. Then there are a lot of things out of there that are really surprising but nobody can understand them. It’s when those two come together that you generate real simplicity.
HB: Let’s look at Uber. Uber has completely disrupted the taxi and car service industry. They’ve done it using technology, using mobile devices, direct consumer to driver communications. If you’ve used it, the interface is so simple. It’s so easy to sign up for the service, to use the service, to pay for the service. That’s a perfect intersection of clarity and surprise. The first time people use it, they can’t believe how easy that just was. That’s an example of those two things coming together for a brand that’s now deemed one of the simplest out there.
BM: Does this proceed from the “delighting the customer” thing we’ve been hearing about for years, or does it grow out of the fact that people have such low expectations, which is to say a high expectation of everything being complex today?
HB: I think those two things come together. but just look at many of the brands out there that are really radically disrupting industries. Uber. Netflix. Zipcar. Blue Apron.
HB: Amazon is enjoying their hegemony because of simplicity. That’s really a red thread that runs through all those industries when you’ve got disruption happening. A new entrant has come in, has recognized an unmet need, has perhaps recognized profound dissatisfaction on the base of consumers and said, “Hey. We can solve this,” and the key to doing it is to employ simplicity.
DS: The other thing we’re seeing in smaller companies, which we call disrupter companies, is that they’re all rooted in the righting of wrong. I’ll give you an example, very simple: Seamless.com. Their notion is that ordering food should be no more difficult than eating it. Boom! Then they deliver that. Or Warby Parker, designer eyeglasses at a revolutionary price. Or Dollar Shave Club, right? Anybody who’s ever paid $23 to $25 for Gillette cartridges is interested. They are tapping into a problem. They are righting what they perceived to be a wrong and they’re delivering it – that is clarity and surprise.
“What we found is that the most innovative companies out there are ones that their employees have rated the simplest to work at. There’s less bureaucracy—and greater clarity of corporate purpose, so that people innovate in a way that that’s aligned with the company’s interest in business.” – Howard Belk
BM: Speaking of clarity and surprise, you’ve been doing the survey for about 5, 6 years?
DS: Six years.
BM: You already had a well established philosophy of simplicity…
DS: …went back 45 years…
BM: So, what have been the surprises for you in the Index?
HB: For me, one of them has been that linkage between stock performance and simplicity. David mentioned it earlier—the companies that are publicly held, that are the leaders in the study crushed every single major stock index every single year in up markets and down markets. That’s been a real eye opener. Another surprise has been the linkage between simplicity and innovation. What we found is that the most innovative companies out there are ones that their employees have rated the simplest to work at. There’s less bureaucracy and a greater clarity of corporate purpose, so that people innovate in a way that’s aligned with the company’s interest in business.
BM: You talked about delivering experiences, and one presumes that needs to be an organization-wide endeavor. How do you see the successful companies doing that or innovating to do that?
HB: IBM fields a global study where they poll over 3,000 CEOs around the world about what’s happening with their businesses, their industries. In a recent study, by a huge margin, those CEOs named complexity as the number one threat to their businesses, and less than 50% of them had a plan for dealing with that. That just goes to show how pervasive the issue is.
The more complex our world gets, the more people place a premium on simplicity. One of the things that these CEOs were really concerned about was getting disrupted. They’re looking at their organizations, their structures, their silos, their processes, their bureaucracies, and they see it stifling innovation. They’re right to be worried, because one of the things our study proved is that organizations that are seen as simpler to work at are the most innovative companies out there.
What does that really mean in practice? It starts with great clarity around the purpose behind the business. What is the business we’re in, what are the things we do, what are the things we don’t do—and that simple articulation of what the business is all about is the starting point for clarity within an organization. That’s going to lead to innovation.
DS: One of the big surprises to me is the advent of this disrupter company. While many of the large “aircraft carrier” organizations are spending millions of dollars trying to decide whether to come out with a gel cap or an extra-strength gel cap or a delayed-release-extra-strength gel cap, these disrupter companies are saying, “We’re about the very, very simple ways of delighting customers. We are going to start from the problem and then just address it single-mindedly in every way we do.”
BM: Would you say that the next frontier for simplicity is more culture-oriented than product oriented?
HB: I wouldn’t say that. Complexity creeps in everywhere, even for companies that have sort of cracked the code in a moment in time. It’s a dynamic environment out there. They’re going to go buy other companies. They’re going to divest themselves of certain things. They’re going to introduce new products. They’re going to come up with ideas that require deeper collaboration across their own organization. The chase for simpler stories, simpler products, simpler experiences, simpler processes … I don’t think it ever stops. It’s something you have to stay on top of all the time.
DS: It really is holistic. One thing that will not change, at least not in our lifetimes, is that organizations will be inhabited by people. This [underscores the] importance of getting the employee base on board to understand what the company stands for, how it’s distinctive, having them believe that they’re not only part of something important but something that’s larger than themselves. There’s all kinds of research coming out now that correlates enhanced productivity with organizational purpose.
BM: Since purpose reportedly connects with what drives millennials, and since millennials are starting to take over, even in B2B, is purpose going to become even more critical?
HB: Yeah. Definitely. These youngsters want to understand what the company is all about. They want to understand the impact that it makes. They want to understand the impact they can make. On some level, it’s elevating the human condition. I don’t see that diminishing in any way. Tackling those issues and doing it with honesty and transparency, not bullsh***ing them about the impact the organization makes, or its products make, is critical. They have a high BS detector. It’s a real challenge.
DS: The other thing I just would like to point out, for those of us who are not millennials, is that we’re not ready to seed the mantle of purpose completely to younger people. There actually are some of us who are more advanced in years that see the great, great potential. People in organizations want to feel part of something that is above and beyond a paycheck and insurance.
“A lot skeptics of purpose think it’s too esoteric, too cerebral, not real. One of the key points in developing purpose is to have a very clear understanding of the economic model.” –David Srere
BM: One last thing … if you’re talking to a CEO, and he or she is in a company that distinctly hasn’t simplified, what would you give them as a to-do list?
HB: Start with the customer. What is the customer experience from start to finish? You have to understand purchase, use, service. Make sure that that whole exercise is as simple as it can be. Make sure that it’s clear, transparent, seamless, fast.
If you start with the customer, and disregard any sacred cows, you’re going to wind up in a good place. If you allow organizational history or legacy systems or status quo to say, “Well, that’s off limits,” you’re not going to be successful.
DS: That is an absolutely a critical place to start. I’d also think about a few other things. One is to have a really honest look in the mirror. What is the organization about? Be clear on what the purpose is of the organization. That’s number one. Then number two is to make sure that purpose is understood and embraced by your employees. A lot skeptics of purpose think it’s too esoteric, too cerebral, not real. One of the key points in developing purpose is to have a very clear understanding of the economic model.
The third thing we would tell CEOs is, believe it or not, don’t lead with the promises. Make the necessary changes so that when you do follow-up with the communications, the employee or the customer is not going to be skeptical— because they’ve already experienced it. Walk before you talk.
BM: Thank you … you reminded me about skeptics. I was at an industry event and overheard one of your competitors saying were doing well with the “simplicity thing,” but that they found it to be overly simplistic. I think he actually employed the word naïvely. How do you respond do that?
HB: I think that’s somebody who’s not really looking deeply at the issue. As I mentioned earlier, IBM did this global study of 3,000 CEOs around the world who named complexity as the number one threat to their businesses. Having a philosophy that centers on simplicity as something that’s a key success factor, I wouldn’t say that that’s naive.
The other thing I would say is that, interestingly, there is a place for naïveté in what we do. Where it shows up is in this area of examining status quo, of looking at sacred cows and killing them. Sometimes you need an outsider to come in with a very fresh and naïve look at products, processes, and systems and say, “It doesn’t have to be that way.” That’s a key element of simplifying things.
BM: We haven’t talked about design; how do you see its role in delivering simplicity and simple experiences?
HB: Design is the secret sauce of these things. In a world that’s becoming ever more mobile, ever more device-centric, there’s a great challenge to create a seamless customer experience or a relationship that works across different media and types of interactions—so design becomes usually important. Here, too, simplicity really helps because it’s a framework to tackle design. It’s a point of view about what’s most important for that customer, consumer, user, employee, colleague, to make sure that their interaction is intuitive, that they don’t even notice the design … that it just delights and surprises them.
That’s very, very difficult to do.