How Amazon built distinctive assets, compound creativity and a winning culture - Ed Smith

0:06Ladies and gentlemen, welcome back to Uncensored CMO. Now, we're going really big in this episode, talking to the biggest retailer on the planet and the biggest advertiser, Amazon. I'm joined by Ed Smith, who's the wonderful CMO for Europe, responsible for so much of what they do in marketing. And they really, really do know what they're doing. They're one of the highest scoring advertisers on the System 1 database. They're also very, very good at delivery operations and measurements. I want to find out from Ed how they approach marketing, why they're so successful, and what's changing and what are they innovating with in the world of marketing.

0:38It's a great episode. I know you'll love it and a great way to start the year. Here it is. Welcome to the show, Ed. Thank you very much. It's a pleasure to be here. It's good to have you. It's good to have you. Now, one thing that everyone, I'm sure, asks you all the time is like, what's sold at Christmas? Because you have literally the data on all the popular toys and games. You want to know? I'm dying to find out what was most popular. I can open that up and have a little live look at the day. There we go. Ooh, Crocs and Jocks. Crocs and Jocks. Best sellers in fashion, which is kind of interesting.

1:11Home and Kitchen, you know those little plasticky clip things you stick, like you can hang lights and things like that? That was pretty good. In books, Guinness Book of Records, 2025. I thought, see, I remember that as a kid, right? I grew up and every Christmas, Guinness Book of Records, I'd be given one every year. and random fact my grandpa was actually in the 1982 in his book of records. Oh, that's an heirloom now. Like literally it's just the best thing ever. So I was very proud of the kid. But yeah, I'm surprised that's still going. The 1 % Club by BBC Studios. Now this is interesting and I'm a user of these but Health and Personal Care, the number one bestseller is the TP Interdental Brush.

1:50Oh. Oral-B Pro 3 relegated to number two there. But we sell a lot of Oral-B toothbrushes. they're a great partner. And Health and Beauty, Maybelline New York, sensational Sky High Mascara. Sky High Mascara. The number one in health and beauty. And then I find some of the other lists kind of interesting, like what are people wishing for or most sold or movers and shakers? Because that's kind of where you de-average the data and you kind of see some of the things that are happening. So there's a Logitech mouse that's a new model that's doing well. More Crocs. Aha, under most wished for in grocery, crack and black spiced rum.

2:32Wow. Number one. Crack and black. Most wished for in home and garden, Ninja, dual zone air fryer. Oh, the air fryer. I knew the air fryer would be somewhere. Yes, returning from last year. So people still want them. Yes. So that's good to see. That's not slowing down. Yeah, that's a quick round of houses from some different fences. There you go, so everyone listening can know what trends it at Christmas. Well, before we get into Amazon, I'd love to find out more about it. How did you get here? So, in fact, actually similar to a guest I had earlier in the show, Jo Shoesmith actually was on Uncensored earlier in the year.

3:02She's like you, is from Australia and found herself all over. Well, I think we've got quite an adventurous gene pool in Australia. Because if you think how we started as a country, we were all the convict. And if we weren't the convicts, we were the people that thought, oh, what the hell, I'll jump on a boat and go to the other end of the world and start a new life. and then after each war or trouble spot all of the immigrants to australia are the people from greece or italy after second world war and vietnam afghanistan they're the people who just had an adventurous spirit and thought i'll go and start again and so as a gene pool we love to travel we pop up everywhere because you've kind of got this natural selection of people that take more risk perhaps explains why for a relatively small country population wise obviously landmass wise is different but you meet australians everywhere now yeah we bet above our weight in risk taking maybe that what it is yeah so just what was your pre-amazon career like what are the highlights on your journey here so i grew up on a on a farm a big sheep property uh and i was an irrigation contractor when i first started out and then i worked in the ski industry uh in austria and australia and that was where i discovered marketing i discovered that through sponsorship.

4:13I worked in the race department. We needed more equipment and we became the Lavazza race department with a$90 ,000 sponsorship. And that led on to sort of marketing. I ended up becoming the marketing director of the biggest ski resort in Australia. And then from there, our ad agency, Chris Clark of Pure Creative, he was a shareholder of DMBNB in Beijing and Shanghai. and so I went to China for a couple of years and ran that agency did a startup with Chris Virtual Communities then retail banking with St George Bank News Corporation in their digital businesses and then group marketing director and then Sky in Australia was Foxtel and then my husband's dad sold his business and built a big boat and said I'm moving to Europe and we said we're coming to.

5:00Did you really? Yeah so then we literally were sitting with friends thinking where we're going to live and they said oh it's a shame you don't have a UK grandparent you can um you can get an ancestry visa I'm like I never knew my grandfather he died before I was born but pretty sure he was British anyway he was we ended up here on ancestry visas yeah so it was really that random and did you do you come to the country first and get the job second or did you identify the job and come with the job no so I took a year off we came here I met about 55 headhunters and I got some feedback in in one of the those interviews that my CV looked a bit crocodile Dundee and couldn't I dial up my UK experience so short of fraud I thought well I've got a year off I'll go to a hundred UK towns and cities and I'll interview five people in each place and I'll come back and know more about the UK consumer than anyone who spent their whole career in London and then someone I was telling that to they said oh it's amazing you should blog it then my mum read the first post and said it's great but you need an editor because you can't spell so someone else said you should film it so I got a film crew and I filmed a few of those and I got a cover story on marketing week and spoke at a couple of marketing conferences and then yeah I found my way to Amazon but I needed to commute to Luxembourg to our head office for the first two years and and since then I've been in the UK.

6:19That's incredible I mean what a thing to do I mean you must understand the vagaries of British life probably better than anyone. It was Brexit, pre-Brexit. And so what I noticed is in the South, everybody wanted out of the EU because they thought it would stem immigration. In the Midlands, everyone wanted out largely because they thought there'd be more support to the NHS. In the North, they just wanted to give the government a kick in the pants. But I'd come back to London and say, wow, it looks like this Brexit thing's going to happen. Everyone's like, no, that's ridiculous. No, I think that was so true.

6:49And I thought, oh, well, I must be wrong. What do I know? I'm just at the beginning of this process. But I was in Cannes the morning I woke up and I'm like, wow, that's exactly what they all told me. Like London was really the only place that wanted in. Like London isn't really a British city. London's a European city that happens to be in the middle of England. In some ways I was shocked but not surprised because it's what I'd been hearing for weeks while I'd been out on the road. And it kind of surprised me if I was out doing that, none of the politicians were. and if you think about your job as a politician to represent your community i mean i was randomly walking up to people and just saying hey i'm from australia can i talk to you what's on your mind what do you think about brexit also asking about brands they love and hate and why but people were very keen to talk and i was thinking wow they really missed a trick not talking to their constituents because it was pretty loud and clear outside london what was going to happen yeah well the importance of listening to your customer right as we very well that humbled me to be honest I remember one place I was up near Cardiff and this guy stumbled out of a pub.

7:56I could hardly understand a word he said, which was embarrassing because I had to keep asking him again and again. But basically his narrative was the Germans are taking the piss. The single currency advantages them more while some of the poorer nations like Greece are disadvantaged because they can't lower their currencies when economic conditions are poor. So it's great for Germany. They can sell more dishwashers and more cars. And then we, the other EU members have to prop up all these poorer countries. Now, he wasn't that eloquent. And it was really hard to get the narrative. But he was a carpenter rolling out of a pub half drunk.

8:33He really knew what was going on and why he wasn't happy with the EU. And it humbled me. I thought I wouldn't, I wouldn't have expected him to be informed and to have such a valid opinion. And it reminded me not to be arrogant and sitting in our glass towers, reading research reports, thinking we know better, because our customers are people like us and they have their own feelings and perceptions informed by their lived experience. And so that was a real wake up moment to me about keeping connected with customers. Well, talking about, I mean, we met just over a year ago, actually, in response to your last year's Christmas campaign, actually, wasn't it?

9:14It was just the incredible Sledging Grannies. If anyone watching, listening remembers it, it's just magical. It's one of the most magical kind of Christmas ads. Very special. It's very special. And it's like, it's so relatable. Everyone can relate to the kind of grannies living their youth again and sledging down the hill. It was brilliant. And in fact, it topped the System 1 poll, which is brilliant. But it got the accolade, shall we say, of a campaign turkey of the week, which is when you kind of picked up the phone to us to go, can I have a look at your data? And, you know, because I don't think it's quite as bad as they're saying.

9:43Well, no one wants their ad to be called out as a turkey in the industry press. We knew it was a good ad when we made it. And the thing that we also really liked about it is a lot of older people are typecast sort of sitting in a chair knitting or being the lovable granny. And actually, a lot of older people live adventurous, wonderful, interesting lives. but that's not really exposed through popular culture and advertising. And so they would delight the people who acted in that to do something fun and a little dangerous. They sledded down a glacier in Mammoth in California. They had ropes on the sleds, but that was the real deal.

10:18And they had a ball. They really loved to shoot. It looks that way as well. You can kind of tell that it was fun. In fact, we did a report, actually, System 1 called Wise Up. It's quite interesting because we've been doing lots of work on diversity, looking at how different groups feel when they see themselves in advertising. And the good news is that if you represent someone in advertising, they feel happier. They feel more strongly. They're more likely to remember what they're seeing, which is great. So we kind of called how diverse advertising unites a nation was the theme of this Feeling Seen series.

10:47But when you go too far, it feels so wrong. Totally. Ah, exactly. And as a gay man, when I see gay couples and it's overpushed and it's just so cringe. You're absolutely right. In fact, we had a few examples where it's done badly, where it's almost like a parody or a joke. It was almost kind of carry on campers type sort of thing. The other thing we found actually, back to the sort of when it doesn't work, is when you try and represent everybody. You see those kind of blocks ticking, right? No, that's when it's cringe as well. Yeah, exactly, because you kind of know what's going on. So one of the lessons actually we found is it's better to tell one person's story authentically than try and represent a whole group badly.

11:24And that's one of the lessons we found. but the point i was going to say back to what you did absolutely really is we had this feeling seen series and every time we you know feeling seen whether it was you know uh race or sexuality and it kind of all proved the same point then we got to old people and we expect it to be the same and what we found is it was scoring lower and basically old people older i say older people because it's over 55 i'm like i'm nearly there when i now see a brief and it's like 18 to 55 And I'm like, what? So I'm not going to be in it anymore. And they're like, oh, we always get a lot of people because they're older people because they watch more television.

11:58I'm like, hmm. Can you imagine like 55 versus 95? That is like, you know, that's like being in the war versus being in the 70s. You know, it's like a huge difference. Anyway, but what we found is actually we found the scores went down. But here's the thing. This is why I called it Wise Up is actually for older people. What they didn't like was how they're represented advertising. But you see this in retirement planning ads and things. So the brief probably says show 50 to 60-year-old people. And then you see like these late 70s couple walking on a beach or something. And you're like, wow, someone in their 20s has got that brief and wildly missed who those people kind of feel they are.

12:38And then when you look at like pop stars and actors who are in that age group, it's wildly different than how that age group is represented in advertising. yeah and i think even within the age i think there's some memes now where aussie osborne and uh prince charles king charles were born on the same day i think and they both own castles they're both kind of male whatever and then you look at how different they are as well but you also would look at that age demographic represented in advertising and you and you would have a very very different kind of that walking on the beach well exactly they would be retired silver gray sunset sort of thing and this is what the report got to actually reason we called it wise up is actually what we learned is they want to be portrayed in advertising as you know the one that's funny the one that's successful the the one that's contributing society the one that's not retired yet you know i mean i was i was thinking uh the way people position cars and we got a new car for my mom when she was 85 looking at sort of a golf and different things anyway she went for apollo gti like we're talking cold start i'm like you sure mom and she's like yeah like i want i'm like a young at heart and it's really fun with like red on the stitching and everything like that and i thought that car would be targeted a young male european audience and here you have an 85 year old woman in australia who wants to feel young and she's drawn to that and again humbled as a marketer just remember that it's not just who you design it for it's how your customers want to feel i want to feel a bit dangerous i want to feel a bit young well it's interesting actually because the um we've been talking about jaguar obviously for the last few weeks you know we're probably a bit bored of it i remember going to a jaguar a design conference 30 years ago a long time ago but right at the beginning of my career and i had the chief designer at jaguar and he was saying uh i think the average age is like 65 for the first time buyer of a jag yeah and he said the way to understand them is to look at what they were doing when they were 25 yeah so they were looking at like mecano and the kind of like the kind of leather that was around at the time you know the treatment of the seats so he designed in the car not for the 65 year old for the 25 year old that they remember and wanted to be and i thought that's quite quite interesting insight i like that yeah it's quite a bit more rock and roll isn't it but you've got a real um history of some you know great emotive advertising which might seem surprising given that you're kind of a i guess a logistics business service in retail is that a conscious thing about amazon advertising to kind of really tap into kind of emotion well i mean i mean at our heart we're a customer centric business so i guess amazon does well because we care deeply about what our customers want.

15:15If you think about brands that do well, the first thing is you have to be salient. You have to have mental availability. So advertising plays a big role in that. But then the most important thing is once you're in the consideration set, you need to be a brand for someone like me. And so if you're just a dry logistics company, I don't know that you'd be necessarily that well chosen by a lot of your customers. So So helping our customers find what they need, helping us to stay salient so when that need arises we're relevant, but then being a brand for people like them, that requires a lot of customer understanding.

15:52And we've got to really watch how customers' preference change over time. What role does selection, price, speed, packaging, environmental impact, recycling, waste, energy? like customers have a lot of inputs into thinking about whether that's a brand for someone like them you seem to you seem to manage the emotional impacts i mean some of the like priest and imam spot you did the grannies i mean last year with midnight opus i mean it's so emotional watching isn't it so you have that emotional pill and then you're very effective with your kind of messaging with the smiling parcels and the boxes it because you're always very well branded you know you're looking at an amazon ad as well don't you it's very effective as well as so so so it's no accident my team and I are fans of Byron Sharp's work.

16:42I think any marketer that doesn't know what their distinctive brand assets are should do a quick bit of research and clock that. And if they don't have any or they're weak, then think about what they want them to be and then be ruthless in your implementation of that over everything forever. And that will eventually build up. I think Dove had the glass and a half and let it go for a bit and Cadbury took it. Oh, really? I didn't know that. That's interesting. I might have made that up, but I'm pretty sure that's true. So you have to, and wasn't the British flag a kind of a BA thing on the tail and then Virgin took it?

17:20Oh, it could be, yeah. There's a lot of things that brands have used and then a new creative director or a new CMO comes in and they muck with those things. But your distinctive brand assets are probably the most important thing in marketing communications. And you want to be very deliberate about that and very consistent. And I don't think that's something you might add to it, but you don't ever really want to just change them out on a whim because you would be horrified how much advertising is misattributed. So, you know, I think a typical ad campaign might have like 60 % brand recognition. that means 40 % of tens of millions of pounds of media budget for those brands is being wasted because no one knows who's advertising.

18:06It's kind of the table stakes that people can work out who the brand is. And the logo at the end won't cut it. Totally right. I mean, it's amazing the amount of times that I talk to customers from a System One perspective, and it's like they've got a beautiful story to tell. But exactly as you say, you might get 50 % or 60 % recognition at the end. That's after seeing it. I mean, imagine like, you know. But remember that seeing an experience, assuming it's AV, may well involve a loo break, making a cup of tea, certainly playing with your phone at the same time. You're not sitting there focused on it like we are as the marketers.

18:39So you've got to, most of our advertising is consumed in a low focus ambient way. So it's got to look and feel like it comes from your brand. And you have to earn that over time through your consistency. You're so right. So if that's your sense is forced exposure where you've got people concentrating to try and spot you exactly in the environment they're in. The most amazing bit of Thinkbox research I came across, which just blew my mind, is say, you know, you know, Gogglebox, where they film people watching. I love Gogglebox. I love Gogglebox. For anyone who's like, you know, not in the UK, doesn't understand this.

19:08Basically, what happens is people are being filmed watching TV and talking about the programs, right? So it sounds dull, but it's actually really, really fast. We did it in Australia as well when I was at Fox 2. Yeah, it's just a brilliant concept. And what Thinkbox, I think it's Thinkbox and ITV collaborated on doing that during the ad break to see what happens in the ad break. And it was fascinating to see what people were doing. So firstly, people claim not to watch the ads. People love ads. They do. Especially good ones. There were these kind of couples going, oh, no one watches the ads anymore.

19:41And then a Just Eat ad would come on. And then they'd turn around and go, did somebody say Just Eat? And they'd literally contradict themselves in the sentence. Did somebody say Menu Log? Oh, no, is it? I love the global versus local debate they must have had there. You must take it. Well, it doesn't work. But the other bit of insight was in the typical ad break, only 30 % of people are watching the ads, but 70 % can hear the ads. So suddenly you go, wow. I mean, like having a jingle or a voiceover or a soundtrack that's connected to you is so important. McDonald's has got to be the high bar for that.

20:18I mean, their consistency and their mnemonic, I really envy that. They're very good at that. We've had several cracks at it. We've tried using a few different things. We're not consistently using a mnemonic, and I'm jealous of brands that have cracked that and do it well and consistently. Lots of brands have a thing, but no one recognizes it or knows what they are, and then there's a few like McDonald's that have just named it. Yeah, you're so right. That's Rick from Adam and Eve. He whistled that. That's actually his whistle. Is it really? Yeah, originally. can you imagine being like that's me literally when we were talking to them when we took them on that they were taking through some of their work and i'm actually the the whistle of the mcdonald's wow like no shut up i was really impressed it was like on uh i don't know what strictly come dancing last year but um they had to go compare opera singer on strictly it was like no way it was like you know and be famous for doing that actually it's the consistent brands that are really, really good at that stuff.

21:15Yeah, yeah. Well, I think it's one thing I get I wonder about a lot. And after the Granny's ad, we debated quite a lot. We thought that ad did really well. Why wouldn't we just use that every year? It's like, oh, but our customers, particularly in the UK, look forward to what your new story is for the year. And the other side of the debate, really, do they? Do they really care? Like look at the Coca-Cola Christmas truck. And then another part, well, that was great because we showed older people in a different light, but there's a lot of other facets of diversity that then we wouldn't ignore. It's a good point.

21:48Luckily, the team did a great job and knocked out another cracker ad this year. But I do look at those ads that are consistently reused with a lot of interest and some envy that they are really getting bang for buck and frugal in terms of not spending a lot more money on production every year. I think that's a really interesting debate for marketers. is when should you aim to land on one you can kind of use forever? And if you're used to making new work, how does that transition ever happen? Well, we've got data on this. I can actually help with this. I've seen some of your data. The top right quadrant is all the ads that are used.

22:25It is, I know. So we looked at both fluency, so branding and short-term spike as well, so not just star rating. And seven of the top ten are consistent. Either they're the same ad or they're an evolution. of the, you know, they're a different execution of the same idea. But to give you the data, for example, Coke holidays are coming, started as a high three-star, ends up as a high five-star, same ad over a long period of time. Audi, Kevin the Carrot's probably the best case study because that was a mid three-star, now it's high five-star consistently. And they have improved it every year. So every year the execution gets a bit better.

23:01They've done a very good job with that. Insanely good job. And one of the things we've worked on a couple of times and I have craved from time to time is what would the creative framework be where every one of Amazon's ads would be a chapter in a book that is the Amazon story? Now, I hadn't actually referenced Aldi, Kevin, the carrot, but that's a good example where every year they're telling another chapter in that story, which I admire. I think they've done a really good job with that. I think, again, based on the data and my experience working with most of these, I mean, we work with about half the top 20 advertisers in the country, and I'd say that's probably the perfect strategy because it feels fresh every year but you've got that familiarity exactly as you've described it.

23:43Our strategy would come from a slightly different angle so we don't have a character but we have a story construct which we call triumph of the everyday hero and Amazon is an enabler brand so it's a little a brand. We're not like, we're Amazon, aren't we amazing? We're like, wow, you're doing something amazing. Can we help? That's kind of the Amazon brand and the triumph of the everyday hero has a customer noticing something, thinking of an idea, ordering a simple product. It gets delivered the next day or same day and then something wonderful happens. And so whether or not it's the dinner suit jacket for the colleagues who want their colleague to perform or the cushions for the grannies to ski down the slope or the torch which is the floodlight for the ballerina or the paper shredder to make the snow globe, So it's always just a little thing that somebody has this great idea.

24:36And so that's our kind of repeatable construct as opposed to repeatable characters. Yeah, it makes complete sense. Now, you talked about decisions about do we do the same thing again? Do we change? What kind of data do you have available to make those decisions? I mean, how do you decide on those kind of things? I guess when it comes to sort of fulfillment, you've got amazing amounts of data. It's very clear what good and bad looks like. How would you decide on something like that? We look at a lot of different things. We would look at the creative strength of the work. And so we look at brand attribution, likability, message outtake, those types of standard metrics.

25:09We look at the economic impact of the campaign. So what did it drive in terms of sales and other things that we care about, you know, signing up for Prime and different things like that. We use quite a lot of judgment. and making great advertising at scale like Amazon does. It's a bit like trying to make great movies or great pop music. You can learn and improve over time, but you'll have some that will work better and some that won't. So, for example, in Europe last year, we were sponsors of the UEFA Women's Football and we really wanted to do a brand ad on that. And I think we made a great ad on that.

25:49However, it didn't go so well compared to some of our other work and a lot of misattribution, but it was very well branded with all our distinctive brand assets, like lots of boxes and unboxing and user info, all the things we normally do. But customers didn't expect Amazon to be doing a sports ad. And also we wanted to portray women footballers in an authentic light. It's a pretty rough and tumble game. And so seeing women athletes banging into each other and sporting conflict, not violence, but the proper sporting conflict and showing all that, that's pretty unexpected for Amazon. So people are like, huh?

26:29And so there's a bit of cognitive load to join the dots that that's an Amazon ad. So then there's a lot of debate then. And so the data says that's not one of the best ads that we've made, but we love this sponsorship and we love this story. And we're one of the biggest sporting goods retailers there are. So what are we going to do here? We're going to double down, lean in, pull back. They're very interesting debates. They must be. Yeah. Yeah. And how do you balance kind of long and short term decisions as well? Because I guess the funny thing, of course, Jeff Bezos is famous for saying, you know, advertising is a tax on a poor product.

27:03So he's also wonderfully pulled back from that and realized that salience and mental availability and brand choice are really important. So it's an important part of our mix. It's a good question. So most of the Amazon marketing organizations originate from a concept that we would call traffic. So whether you think about free or paid search or social, where we might be doing, say, ACE and retargeting advertising, and most of those channels are tuned where we can invest to the last marginally efficient dollar. And so it's not like we are looking at a basket of money and thinking how much will we invest in short term or long term.

27:46Each of those channels is operating with a lot of technology and a lot of scale at its optimum. And then when we come to advertising, we think, well, what are the brands that we want to build and what are the jobs we want to do? So in my tenure at Amazon, we've spent time advertising the Climate Pledge. We've spent time advertising various other environmental and reputation initiatives. We had spent time Echo and Alexa, the Amazon brand, the Prime brand, our deal events. and so then it's a portfolio discussion of which which what are our priorities what brands are we investing in where are our deal events and and and how much does each of them need to be sufficient i guess yeah you're juggling a lot as well and you've got all the promotions like black friday as well and prime day and what it's like how how does amazon cope with managing the demand side of it you know it's a supply side really because you're creating demand through what you're doing you know all the things you're doing but you've got to fulfill that as well on the other side So that's highly automated.

28:45There's a secret department, the men in black that do the forecasting. Yeah, Christmas. But we have so many. So more than half of everything sold on Amazon comes from third-party businesses. And so they're managing their own stock and we're selling for them. So that's half the work is with them. And on the Amazon retail side of the business, quite a lot of sophisticated demand forecasting, automated ordering. and then a lot of old school vendor management. So vendor managers talking with their brands and looking at the promotion calendar and working on pricing and how they're going to operate it.