Revisiting 'How Brands Grow' with Byron Sharp

0:09Hello and welcome to The Walk Podcast. My name is David Tiltman and today we are joined by someone who needs a little introduction to walk listeners. It's Professor Byron Sharp of the Ehrenberg Bass Institute. Now, in the world of marketing effectiveness, there's a few seminal texts that marketers reach for again and again. One of those is How Brands Grow by Byron Sharp, a book that builds on empirical data to outline a series of laws that, you guessed it, explain how brands grow. If you've heard of Double Jeopardy, Mental and Physical Abailability, or the MBD Dirichlet model, you're already familiar with some of the ideas in how brands grow and how they've shaped decision-making at major firms in the 16 years since it was published.

0:56Today, Byron, whose official title is Professor of Marketing Science at Adelaide University and Director of the Ehrenberg Bass Institute for Marketing Science, joins us to describe the foundational ideas at the heart of how brands grow and importantly, how they apply in a fast-changing industry. Now, this is a video podcast, so you can see us as well as hear us on the Walk YouTube channel. The industry is full of opinions, but brands don't make decisions based on opinions. They make them based on evidence they can trust. Partner with a leading industry authority on marketing effectiveness to make your case.

1:38Lions Advisory brings together decades of trusted expertise from walk, can Lions, Effie and Contagious to create industry-defining thought leadership. From crafting the narrative to amplifying it at scale and placing it in front of key decision makers. So your story doesn't just add to the conversation, it defines it. Learn more at lions.co forward slash thought leadership.

2:04Byron Sharp, welcome to The Walk Podcast. Thank you very much. It's great fun to be here. Now, we're talking to you, I'm going to say, 24 hours since you were on stage on the Debussy with Mark Ritson. Yeah, I remember him. Remember him, yeah. Were you happy with how it went? Yeah, it was good fun. I think both Mark and I enjoyed myself and the audience seemed to really enjoy themselves. So, you know, you never know as a creative concept, you know, will us agreeing with each other just be a boring love fest or will it be a little bit unpredictable and will people learn things? I think there was enough spice in there to keep people interested.

2:43How easy was it to find five things you actually agreed on? Oh, really easy. Yeah. I mean, I sort of challenge people when they say, oh, you and Ritson disagree. And I'm like, well, he might have used to disagree on a number of things, but can you tell me what he actually disagrees with us on today? And I think the only thing which I think I raised, and things. I think Mark would like, hope, that, I mean, he'd admit, mental and physical availability, the theory works. That is the biggest, those are the biggest drivers of a brand, which is a change to, the mental availability is a change to not what the brand evokes, but what evokes the brand.

3:29That's a great quote, by the way. I really like that. Let's just repeat that. It's not what the brand evokes. It's what evokes the brand. Yeah, which I didn't come up with. I don't even think Jenny would say. That really came from someone else. But it was a major shift in thinking. But I think Mark would like to go, because he's taught positioning for all his life, that there be something in brand image. And we're open to that. We're researching that. We know it won't be big, but maybe in some cases it might be. We'll see. That's a great trail for a question I want to ask you as we go through this podcast.

4:11But I guess what I'd love to do, I mean, you know, I reread How Brands Grow last week. Good on you. So I couldn't be accused of not reading. Yeah, good, good. But what struck me rereading it is that it is a sort of fully formed body of work. It's not like you sort of put some ideas out in that book that now you've sort of moved on. Right. Yeah. Yeah. It wasn't a hypothesis. Most books have one. That's why they can usually be summarized to one sort of thing. Yeah. And I actually don't like summaries of how brands go because it… Misses out a lot. Yeah. Probably the advertising chapter is exceptionally misunderstood.

4:59Yeah. Well, come on to that. too weird for people to understand um sorry most scientific understand are quite weird festival um yeah it is that um well because you know it drew on um the first the erenberg's law of buyer frequency that all brands face a negative binomial distribution in terms of the rates of buying of their customers from the heavies mediums lights you know that was discovered in the late 50s was a big surprise and took ages to work out what on earth that and that's the kind of like banana thing yeah like the yeah except yeah except it isn't always shaped like that but as a general thing in a particular time it tends to look like that but it doesn't always that's why it is important to actually know that it is a for the geeks out there it is important to know that it is a negative binomial distribution right not just a skewed distribution where most are light.

6:02And probably the most important question in this particular thing is, how on earth do you pronounce? Is it Dirichlet? What's the actual pronunciation? The common way is Dirichlet, which is the French way. Some people say that's wrong because I think the statistician was actually German, so it should be Dirichlet. But, you know, like it's... Okay, but it's a soft speech. I'm going to remember that. I remember that. Now, look, you mentioned Andrew Ehrenberg. It was the centenary of his birth in May this year. And I guess what I'd love to just get your thoughts on is that sort of through line from his thinking, because you worked with him earlier in your career, and then how that sort of influenced your thinking through to the release of how brands grow.

6:55And what, I guess, what you sort of, what layer you put on it and others within maybe around you that sort of took what was a sort of very statistician's view of the world and tried to sort of turn it into something that actual brand managers could use. Right. Okay. Well, yeah. Yes, Andrew was a statistician. he brought a unique lens to looking at consumer panel data. He ran a consultancy before he joined London Business School that was called Ask Research. And they would take panel data that had been developed. I mean, Nielsen or something were running. No, it wasn't. It was before that. But people would get this and go, well, what does this mean?

7:44And so Andrew would use data reduction and discovered patterns in it and gave it meaning. So he was doing old-fashioned, really classic science. I, even though I didn't have a science background, had a great sort of affinity, love for that. And I was sort of from the Philip Kotler, this sort of, here at Cannes, there'll be this very popular view that advertising can somehow imbue brands with some sort of magic special added values, which sounds lovely, although it's a bit pernicious, and it sort of suggests that advertising can manipulate people to buy things or pay more for things than they should.

8:26And economists certainly accuse marketing people of that. It was an accusation and they were hidden persuaders. Yes, exactly, yes. And then you had Philip. I was a fan, you know, I was a young undergraduate. I had this Philip Kotler textbook and it said, well, actually, you know, people's garages aren't full of cars that they don't drive and fridges that they don't use. And people aren't that stupid. There's a lovely David Gogov quote, isn't there? Like, the consumer isn't stupid. She's your wife. Tells so many stories. So I was of that school. And so I was very suspicious about this added values thing.

9:03And I thought what people were really underestimating was the importance of brand awareness. And with Emma McDonald, who's now a research professor in Strathclyde, I think. So this goes back a long way. We did some experiments and things, and we did some surveys of managers of what did they think of brand awareness, ad awareness, and the results are a bit shocking. They didn't really even understand the difference between them, and it really wasn't paid much attention. And I thought part of the problem with this is there's this huge emphasis on attitude, convincing people that we are better, et cetera.

9:44And of course, when I met Andrew, that sort of perspective fit with the data of how people are buying. Oh, I see. Yeah, yeah. Potentially awareness and things is massively more important. And so I think the first thing I talked about was something about breadth and depth of awareness. And that started us thinking about that awareness isn't just a simple yes, no. that it's sort of probabilistic and yeah of course everyone knows coca-cola and if you say yeah but do they think of coca-cola when they're in a coffee shop they're thirsty and they will yeah well the coffee shop's a great example because that's their coke just has such low mental availability yeah and like really coke low yeah well it does and and so that highlighted the concept and that fits with the by behavior empirical data that andrew had and so we were just sort of kindred spirits i think um and andrew andrew sort of reflected he'd he'd read read some of his old he he one point went i've read some of my old articles they're so researchy so he could see he could see the the problems yeah he he um yeah we're not telling people what this means and we haven't sorted out and he said always the d is so much harder and i think that's that i mean we made new discoveries and things like that but really the the work over the last 20 years and working out what things mean and also how how to how to uh how to say them to people yeah um sometimes i'm embarrassed when i look back and go oh god it took us so long to realize that like if we say uh you know continuity people just don't get it they don't understand what does continuity for advertising mean does that yeah they there is a better way of saying that do you ever reread something like how brands grow and think i wish we'd explain that differently oh yeah yeah yeah what sort of thing yeah i know i'm just i have to tell a funny story now because andrew once said byron we need to talk about my problem okay andrew what's the problem and it's the fact He would revise and revise and revise.

11:57And I went, well, Andrew, people think your writing is actually quite good. Because you're not a native English speaker and you're aware of that, that you do all this revision. I think it's good. And I said, I was on the plane the other day and I was looking through an article that I'd published in a journal and I hit my pen out and I was changing things. And he went, oh, no, that's weird.

12:20It's already published. Once it's published. That's weird. But yeah, so communication is difficult, right? We've got a whole festival here, which basically is, you could say, the really core is that communication is really quite difficult, and it's difficult for scientists and things as well. What still surprises marketers when you present the sort of basics? Because as you say, it is quite a head flip when you first sort of encounter the theory and the data? Yes, we don't get the outright shock that we're used to. Yeah, well, that's good. That's progress. Yes, it is. But we've still got a long way to go.

13:04I won't name the company, but I was at a large US consumer goods company and I was introduced to the new CMO. And a couple of days before, he was new. So his staff had briefed him on this book and there are these laws in marketing. He thought these were pretty interesting. And I thought, how did you get this job? Seriously? You got this job and you didn't know about these things. Wow. That won't happen in 20 years' time. No. I think it's probably fair to say the United States is behind. But it will change. Because I know Mark's written about that as well, about how he thinks US marketing's kind of sort of fallen behind.

13:49Do you feel that too? Yeah.

13:57Multinational CMOs will often tell me it's harder to get change in the US than it is in other places. Interesting. Less receptive. I think there's a bit of an attitude. It's now an old country. Yeah. Old universities. 250 years old. Yes, this year. With old universities. And there's a feeling of, there's a bit of a feeling that, like, Americans invented marketing. So how could they learn from anywhere else in the world? From Australia or Europe or that lone Asia. Yes. And they'd expect to see it coming from an Ivy League business school. It's like, we've got the best business schools in the world.

14:33So there's a bit of that view, I think. Right. I met a friend, where was it? I think it was in London. London Grand City. And he admittedly, it was Grand City. but New York, capital of the world and I mean I live in the Asia time zone New York's on the other side of the planet and we've got like 3 billion people I don't think we see New York as the capital of the world No, that is but that's still very common that's still a very common mindset we have business in Asia and we are told that repeatedly not just by people in Asia like clients in Asia, but our own team will tell us we're being too London-centric or New York-centric.

15:18So it keeps us on our toes. Good, good, good. Now look, as I said, the book is full of, you know, full of, is it 11 laws? I think so, 11 or 12. 11 or 12. There's a lot of laws. What I don't want to do is... There are more. You've even got even more since. Is there a law that you think is particularly neglected or overlooked? There's one that's quite simple. I mean, I used a funny title for it, which is the My Mum Theory or the I Love My Mum, which is when you look at image data of how users of one brand see their brand and you compare it to how users of another brand see their brand, it's so similar, right?

16:06And so I said, my mum, I love my mum, she's the best mum in the world but she can be really annoying sometimes is that like your mum and no comment i don't think people will realize what you're saying there we're saying that in brand image data and attitudinal data you get the same double jeopardy type patterns yeah when you when you account for size when you count for the the the familiarity or knowledge or usage then the brands start to look astonishingly similar. And you're talking about very, very fine differences, which can be worth looking at. Is our brand slightly positioned on, I don't know, faster, like a fast food brand or something like that.

16:53But it's a small story. The big story is, wow, we're all seeing sort of the same. The same. If you want a brand image score to go up in your brand tracking, basically you need to grow your brand. And that's about the direction of causation. Yeah, it strongly suggests, of course, that attitudes and perceptions are powerfully driven by behavior. Yes. So behavior comes before attitude rather than the other way. Yeah, I mean, there has to be. I think there is a university textbook. There has to be two-way causality. There are some times when we say, you know, I hate that. And we do mean it. In the textbook, I use a quote from the first George Bush as president.

17:41He said, like, I hate broccoli. And now that I'm the president of the most powerful country in the world, I should be able to not eat broccoli. That was expressing a pretty strong attitude. And you would think it affected his behavior. Although actually he got in trouble with American broccoli farmers. So I had to start eating it again, baby.

18:28work and share your thinking with clarity and confidence. Lions Intelligence is where groundwork becomes great work. Insight, strategy, creativity, execution, all in one place. To learn more, check out intelligence.lions.co.

18:48I would like to just like to talk a little bit about the challenges in the current market, because we've been talking to a lot of clients here, agencies. The market is in a sort of funny place at the moment, and even if you strip out AI and the rest of it. We've got low growth in lots of categories and markets, lots of pressure on budgets. We know from people like Gartner that marketing budgets is a percentage of revenue have never been lower. You mean advertising budgets? No, overall marketing budget. We've seen advertising, so within the Gartner definition, it's marketing. So that would include ad tech, paid media, actual people costs, those sorts of things.

19:36And we've seen in our own data that advertising budgets are heavily under pressure as an extension of that. I'm interested in the Institute's recommendations in this sort of market, where it's difficult to grow at all within many of these categories. Clearly, there are still some categories that are growing a lot, but there are categories that aren't growing. What's the sort of recommendation there in terms of maintaining advertising spend, how you plot your way through a downturn, if we think it's a temporary downturn? Give me a few sort of highlights of the research you've done in this sort of space.

20:19Well, you've got to be good at marketing. And so you have to be evidence-based. I mean, if you think times are tough, well, then you have to get fitter. So really the perennial ongoing battle is to be a better marketing department than your competitors. And that's, I mean, there will be a recession, right? I mean, growth is pretty anemic here in Western Europe. But globally, actually, every single developed economy at the moment is growing. Sometimes not by much. We are. Yeah. Mind you, that's not a new story, right? Western Europe has been anemic for all of the century. So I won't blame marketers for that.

21:05We'll blame governments, I think. Well, that's true. I mean, if you look at CPG in particular, for example. Yeah, we have the hangover from the inflationary period where… It hasn't gone away in some… Yeah, but what has gone away is, first of all, people put prices up because their costs were going up. And in actual fact, private label had to sort of move first because they had the thinnest… Yeah, yeah. And so a lot of national brands suddenly found they were blitzing their sales targets and everything was actually quite wonderful. Right. And then, you know, and they had consultants telling them, it's okay, you've got pricing power.

21:42And then their volumes started to drop and they started to lose penetration. So this is, yeah, we're well into that bit now, that shock of, oh, things aren't easy now. When real household income goes down, that means they have less to spend. And you've got sort of a two-speed thing we've got sort of retired baby boomers who've been sitting on rising house prices and things and they're still going off on their cruises etc but that's that's not in the states you've got the what's called the k-shaped economy where you've you've got um i guess let's say like 10 percent of consumers now represent 50 percent of um uh customer spending so uh you've got sort of a thin layer at the top that seems to be growing and spending and then yeah well a lot of the big branded goods companies you know are selling to families and into households and uh that's where you you know the baby boomers can go off on their yachts and things uh that doesn't help you selling uh window cleaner if anything your sales go down and and the consumers in the house so i mean there are bright spots of course right i mean it makes it really hard if you're running cafe or restaurant and so super spending on food I think is up.

23:02Sort of COVID light. God, I thought it escaped that. The Institute has warned of the danger of pulling back on advertising. Would that hold in this sort of scenario?

23:19Yes and no. Okay. Because advertising doesn't jerk your sales up and down. um it it it's effects are spread very thinly in in time just a weak force kind of well it's not a it's not that a weak force it's just that you know john dole's 95 yes you know yes most most most exposures are going to show up in next week's sales because they're not even going to buy the category um but it will you know it does show up it keeps you up because it enhances the propensity is going forward, but it's very thinly. So weight tests, when academics have split control things and they know the households that get exposed, and if you double weight of advertising, pretty much nothing happens.

24:04And that's true if you have advertising. It doesn't happen straight away? No. And so our report on when brands go dark show for big established brands, it takes quite a long time before the decline to start to cut in. so if you're worried about going broke yeah yeah stop advertising that's not a problem what you can't do is pull back on your purchase availability because like if a store halves its opening hours it pretty much halves its sales right so if you that stuff you have to keep up now here's the bad news though for people who think you know in a recession or something i'll just double up on my activations or my purchase availability stuff.

24:48No, that won't either because, well, you should have optimized that. You should have, because you can see that showing up in your sales. So you should have optimized that for profitability. And so if someone says to you, if the CEO goes, well, increase that. You know it will be, I can, and sales might go up, but profits will go down. And then your CEO will go, oh, no, don't do that. Don't do that. Right, so what do we have as a lesson to weather the storm? Probably a big thing is keep calm and carry on. You know, you can trim your advertising expenditure. You can, in the same way, you might trim some of your R &D projects and things like that if you're worried about cash flow going broke.

25:29But otherwise, one thing we do know about recessions is they come. They come and they go. And they go. Well, hopefully, as you say, Europe feels like it's been in a while. It's just been anemic, hasn't it? What's your advice to marketers who are sort of struggling to make that case to the CEO or CEO in terms of metrics? Well, stop shooting yourself in the foot of saying, if you give me more advertising budget, I will give you a lift in sales. That's a credibility. Oh, that's just stupid, right? I mean, that's like gambling addiction. You know, like it didn't pay off. It didn't pay off. But the next time I might win.

26:10that's amazingly stupid so instead give your cfo credible metrics that show you are doing a better job to build mental availability convincing your cfo that mental availability is a valuable asset is not i mean really if you're a marketer and you can't sell that then get out of the profession right cfos do understand intangible assets and that um and i have to say just we we've had these conversations that the 95-5 rule has been incredibly useful in starting that conversation that's that i know it's it it was a specific not a specific piece of work done on a specific um sort of set of yeah john dawes just used it to try to explain to b2b people that are the sort of negative binomial distribution um and uh yeah i was talking with mark ritson and we're saying wow it works yeah it was but it's about the framing and the communication yes back to that and it was um uh yeah people people can understand that in a way that other terms we use within within our space that seem harder to explain they understand that most people actually oh yeah that's right of course because i'm not always in the market for yes and so it starts hopefully to the understanding that, oh, so I can't really use my sales next week to judge the advertising from last week.

27:36I mean, it's like, no, advertising's weird. I mean, it is a really weird thing. Like a huge number of your ads reach people who've just bought. Oh, that doesn't sound very good. That was a bit, oh, we missed them. That's stupid. Reaches people who aren't in the market yet. Oh, that seems like an incredible waste, unless you want to grow your category. and it hits people who won't buy for maybe a year or two. And you go, that's all good stuff. And then the sort of, I guess the flip side of that is that the sales today are still being influenced by advertising. Yes. You may have run months or even years ago.

28:12Yes. It's a humbling thought, isn't it, for most CMOs to go, no, most of your sale today. Your predecessor. Your predecessor. And their predecessor and their predecessor and their predecessor. And so that tells you that, oh, right, so my job is to pass on a brand in good health and a marketing department that knows about effectiveness. If I can do that, I have succeeded. I want the person who takes over from me to say, wow, what a great thing I have inherited. Yeah, I better not screw it up. Yes, exactly. Yes, it has got that, isn't it? Like the predecessors didn't screw it up. I better not do that either.

28:49Yes. um i like to spend a few minutes sort of talking about some specific areas or of debate or discussion and i picked these areas because i think there are people that make assumptions about what the erin bringbath institute make and what i'd love to do is just get your you know hear it if you'll excuse the phrase from the horse's mouth and and what you actually do you do think okay um so i've got a few of them so let's just run run through them by a bit so So I guess one thing I've seen is an assumption that the sort of Ehrenberg-Bass thinking laws apply to big brands and sort of describe big brands and how big brands operate, but don't really explain how small brands get big.

29:38Do you have a view on how? Yes, we've studied tiny brands deliberately because of that. But I did point out, but I guess everyone, I said at the start of how brands grow, you know, of course I'm using famous brands here and big brands. Because if I talk about some obscure Yugoslavian brand. Yeah, well, nobody's going to understand it. They're a mess of in Yugoslavia. Yeah. So, you know, for the negative binomial distribution, I deliberately chose Coca-Cola because I thought, well, that's the biggest sort of brand I can think of. And it's pretty amazing to think that you're a heavy Coke buyer if you buy like three cans a year.

30:14Wow. Is there anything special about that? Is there anything they should do differently to the way the big brands operate if you're a mid-sized brand looking to scale? What we do notice is there are more tiny brands that have, in the double jeopardy language, we would say for that 0.5 % market share, too much of it is made up of penetration and and not enough out of loyalty they are sort of uh they're i mean double jeopardy predicts that they will have very low penetration and slightly lower purchase frequency but they tend to have more penetration than we think and and um not so much in any sort of loyalty metric and this we believe is because they suffer from a lack of overlap of their mental and physical availability.

31:13And so what that means is the people who buy them, like once, find it harder than they should to repeat purchase. To buy again. Yeah. It's like you go to a restaurant, you think the food's great, tell yourself you'll come back, and then you just forget about it because you have nothing reinforcing. You didn't see any advertising for it. No one spoke about it or something. So the answer to that is? then you need to work to fix that overlap yeah um also i think a number of tiny brands get sort of serendipitous sales you know more than you should normally just some people bought them because they're in a rush and you know it was on the shelf and then they bought that one and then they're not going to come and buy it again because if you ask them what was that yogurt they go um yeah i think what i think was in a blue no white i don't know yeah okay yeah so that is a weird that is a particular thing for tiny brands although most of them aren't like that and what we do know is when they grow they increase the size of their customer base um second thing i wanted to ask then is about the term brands and how you see that overlaps with mental availability you talked about brand image earlier oh yeah um so i'm just interested in uh because i guess this I don't want to go too much down a differentiation rabbit hole, but there's still a sense that people in the industry will argue that differentiation does in some cases matter.

32:46And you've been very clear that. Well, sometimes there's some differentiated brands, yeah. Give me an example of a brand you would see as differentiated then. Aldi. The supermarket, the retailer. And that is differentiation is based on. Low prices. and are massively reduced assortment because they don't carry national brands. So you can't have 16 different types of chocolate biscuit brand because people can't navigate it, right? Because they don't know these brands. So you instead have one. That is differentiation. So that is a negative, actually. I mean, because you don't have the national brands, you have to have a smaller assortment, and because of that, you have to have lower prices.

33:30So it is differentiation, some positive and some negative. lower prices everyone loves lower prices is positive positive differentiation you can think of i mean would something like apple count or is that uh well lots of luxury luxury i mean the luxury is sort of a weird category anyway i suppose but um no luxury well there's differentiations everywhere as far as not what we call brand differentiation but but situational differentiation right like you know you might look at chanel's dresses this year yeah and go wow that's amazing i love them you know and and i don't like the dual ones and next year vice versa but you know that stuff comes and goes but i suppose actually like luxury brands have very little differentiation between between yeah yeah you know like if you say do you like the dress yeah it's great it's chanel great oh no sorry it's your oh great no no sorry it's versace oh great you know there's people don't care so differentiated brands exist but this is very difficult to do yeah but the good news is you don't have to worry like multi-billion dollar brands the last 100 years aren't terribly differentiated.

34:34But sometimes it'll stand out to you, like, wow, yeah, our brand really is. And then you make strategic decisions to either lean into that or fix it. Sometimes it's something you have to fix. It's a great case study of, I think, it's Goya Foods in the US. So they were very seen as Mexican food. And then they started to realize that we should go broader. yeah we should say to someone it's you know it's sometimes yeah that it can be a recipe for being niche yeah yeah the uh what's the one in the uk corn corn yeah yeah and they they lend into it's just protein not yeah it's you know like if we want to just sell to the vegans in the country we're going to stay very small yeah yeah we've seen we've seen that in a actually in a few a few cases in the uk but there's real differentiation so corn mince is not it's not the same it's not actually made from cows so uh yeah i guess but in that in that sense i guess the differentiation is about the product itself oh yeah and most differentiation most well actually the biggest drive of differentiation is typically location yeah yes of course yes yeah and then it's big stuff like price and product features and things um so don't you know this idea that's fun so much at places like calm that you can do cunning advertising that'll make people see your brand is different.

36:01Not convinced. Okay. And you've got to, don't let that distract you from the battle to build mental availability. Let's talk about the link then with, well, lack of link, with pricing because that's been a big, big theme in the last couple of years of, there are industry bodies that will argue that brand is connected with pricing power, which is, uh so advertising it affects brand which can affect pricing power yeah so normal and very what people often confusing is you know premium brands from brand elasticity saying that brand sells at a higher price yes it's a premium brand that's not the same as elasticity which is pricing power supposed to be about the idea that you lift price and your volume doesn't doesn't move or doesn't drop yeah yeah it's hard to find any brands in the world that that doesn't happen to so what can you use avatar if you increase here's a love it hopefully byron sharp quote if you want to increase your price without losing lots of volume then increase your mental and physical availability or improve your product quality ideally do all of those things yeah but if you think oh no that all sounds like hard work i just want to raise my price fine you'll lose volume and how does so you mentioned brand image earlier let's just let's just clear that bit off brand image how does brand just let's be very clear on this because i think i know but i'd like to hear it from you sure how does brand image differ from mental availability okay mental availability is coming to mind that you get noticed on shelf or you are seen on screen or it's the propensity that brand actually gets some consideration chance to be bought in the right situations yeah yeah well whenever someone can buy yes uh was brand image cuts in at that point you you mental value is one of the options and it's then that you go oh what you know what does that brand you know so you might go represents or oh no that one's low quality or you know and that's where it has it so it can only work yeah at there and we looked at brand purpose as an aspect of brand image and what we found is that well the problem is it hardly ever does come to mind so you know most people just don't link it so it can't be working uh brand you know coming to mind being mentally available is essential and then you want a brand image that makes you acceptable so it's it's plays a role but it's less important than the mental it has to be but we're wondering you know are there so norm de grieve uh the current cmo of um general motors you know he's like but you know there must be you know there are brands that you know people would be proud to own and then maybe brands that they wouldn't want to own and so that might stop them you know reason not to buy and yeah uh yeah i can i can imagine that for cars i'm really interested to research that which we are um because the weird thing is i can actually also think of a completely opposite argument which is yeah people do hold these different images with cars but it doesn't seem to stop them buying a lot of very boring cars and companies like toyota slowly slowly slowly becoming the biggest car company in the world yeah most people buy gray black practical cars you know and we go oh what about when the chinese cars come in you know people won't want to buy a chinese car yeah yeah they say they don't but then they do um what about markets or categories experiencing rapid growth or disruption so you know we've got things like i guess i mean like ai as a market is growing very quickly at the moment jenny romanick done some really quite cool stuff on that of showing about the mental availability of the different you know big chat slots and how they compete it's a battle of brands there i you know And so the laws apply in those markets just as much?

40:02Yes, they do. Because I guess one challenge to the Institute's thinking has been for people who say, well, it's just about stable markets. The laws are really built on stable markets. Oh, this is stupid. People don't understand that. The MBD-Deerish layer, which is particularly a mathematical model that predicts the laws. It just predicts the laws. It isn't the laws themselves. is it has certain assumptions and one is that it's for stationary markets, that people's loyalties, their propensities are fixed. And we know that's not true, you know, in that they're not absolutely fixed. And we know that in any market there has to be some brands that are growing and some declining.

40:43But the amazing thing is, yeah, but if you look in a time period like a year or something, that doesn't really shake up. The laws are so big, the patterns are so big that it doesn't shake it up. So that's an interesting empirical thing. But some people think it's some sort of gotcha. They're like, I've just read it's a stationary model. Gotcha.

41:05It's not. So no, the amazing thing is, so you could say that the laws, like double jeopardy law, doesn't say anything about growth. But it does. It says, if I'm to double my market share, my penetration has to near double. It has to. and that's telling me a lot about growth. Yeah, even in a market that is itself growing. And presumably in those sorts of markets, the opportunity where you have new people coming in to buy. All markets have some dynamism, yeah. Yeah, there's always people cycling in and out of a market. So the job is still getting them to consider you in the relevant moment. Magna and her colleagues, you know, work on categories.

41:56It's fascinating, the same thing, that categories grow like brands. You must increase your penetration. Oh, well, sorry, I don't say must. I mean, they also can grow through premiumization. Look, we're nearly out of time, so I guess what I'd love to know is what you and the Institute are looking at kind of next. What are you researching? I know you've got, like, lots of researchers doing lots of things, but what are you I guess what are you most excited about researching or finding out next uh I don't know I I like that the thing that we're looking at brand image because to me that's a the old area I did my master's on that and so instead of returning to that sort of home um I had a bit of trouble convincing some others that we should because they're like okay but every time I go and look at it I look at them data and I look at things I keep coming back to its mental and physical availability and this brand image must be so tidy I don't want to I I don't want to research something so tidy.

42:50But I think it behooves us to go and look. There might be some places where it's really important. So I think that's exciting. But I also have a job as director of where's the future going for the Arnberg Bass Institute. And I think that's quite exciting. I think we are building AI agents that people will be able to plug into their AI. Because every company is going to, as part of their competitive advantage, they're going to be building AI to help them do things like plan media, plan portfolios, do brand planning. And I think they will want to have Ehrenberg Bass as part of that so it can sense check and make sure that some of the other AI agents don't recommend a plain design that breaks the laws of physics.

43:40I guess my final, final question is I've got you. Like, this has been a lovely chat. But you're known for having a very, let's say, assertive personality on social media. So when I've told people I'm interviewing you, they've said, oh, you know, why is he so hard on people on social media? What's your sort of view on how you use social media? Well, in social media, I'm not going to write an article. And sometimes people come back and go, can I please have references on that? Can I do that? And to the credit, other people sometimes chip in and go, I don't think it's his job to do all your homework for you.

44:29So I tend to chip in when someone says something outrageously wrong. And that's my job. I mean, academics, our first allegiance is to the truth. Academics can be quite hard on each other. Oh, yeah, yeah, yeah. There's an old joke about why the fight's so vicious in academia, because the stakes are so small. No, but yeah, when someone says something like, I don't know, I point out when research is wrong, or because I feel someone's putting something out into the public domain, they're trying to influence people, it's very important that someone gets in there and fact-checks early. Marketing runs.

45:09we we aren't like like you know pharmaceutical companies have to go through all this review they're not going to put a drug on the market anymore they used to you know that hasn't had some checking and things but in marketing people people put out research all the time you know guess what new research from the radio association that says guess what everyone should be spending more on radio you know well yes I think for our listeners the air quotes you just put around the word research is worth Yeah, it's a lot of advertorials. Look, I'm not going to not research just because someone has an interest in it.

45:45Because I still want to, you know. But when I see they've got an interest in it, the method is hopeless or it's totally black box and things. I feel I do have a duty because unfortunately lots of marketers aren't trained to detect bullshit. And so I need to say ignore that. Okay. Now people don't like that. no no they definitely don't I know that I know that much but no one likes putting their assignment and getting a fail grade no fair enough but okay um look Byron it's been an absolute pleasure having you on the walk podcast thank you so much for your time thank you that's all we've got time for today a big thank you to Byron for joining us here on the walk podcast if you like what you heard please do follow us on your podcasting platform of choice and if you really liked it please do leave us a review until next time thanks for listening

46:39Transcription by CastingWords