Hi, my name's Paul Baines...
...and I'm Professor of Political Marketing at Cranfield School of Management and this is Red...
...Virgin Media's Chief Values Officer.
In the next clip, you'll see an interview with Richard Larcombe...
...Director of Advertising and Sponsorship at Virgin Media.
In the clip, he articulates a common problem in marketing...
...and that's how does a company differentiate itself in a cluttered market space?
Hello, my name is Richard Larcombe.
I'm Director of Advertising and Sponsorship at Virgin Media.
I've been here about three years and my remit kind of covers...
...brand strategy; above the line communications, so kind of your TV...
...cinema, that type of thing; social, retail marketing;
...brand activation and partnership - so things like V Festival...
...Virgin Media Shorts; and media strategy.
So that's kind of what I do here.
We work in a very noisy neighbourhood...
...with two big competitors in BT and Sky,that kind of keep us on our toes.
I think Virgin Media is a unique brand.
It is one of the most admired brands in the world...
...and I think its brand is its greatest strength.
I think also from a product point of view...
...we have a unrivalled infrastructure in our fibre optic cable network...
...and I think finally, we are an open source platform.
So in many respects, you could see us as the ultimate aggregator -
...so we are completely open...
...and we're open to work with the best applications in the UK, whether it's Spotify...
...the best content providers in the UK, whether it's Sky...
...and so actually what we want to do is rather than necessarily create ourselves...
...of which we might do a little bit moving forward into the future...
...we want to be completely open to get the best of breed for our customers.
Within our marketing, digital has always played a really important role.
We are a technology brand, we're an entertainment brand...
But I think kind of aside from that...
...we know just from a sales point of view, actually...
...our sales have started to erode from a call point of view...
...taken up by our exponential growth in the digital space.
So for example, in the last two years, we've seen our online sales rise from about 9% to about 28%...
...so I think the importance of it is only going to continue.
When we look, actually the customer lifetime value of digital customers versus...
...other areas of the business, actually...
...so we look at two metrics.
We look at CLV, which is Customer Lifetime Value, and also we look at NPS...
...and NPS is Net Promoter Score which, is a measure of...
...satisfaction or dissatisfaction of their customer.
You know actually interestingly, retail is the area of the business that drives the best scores.
...and that's probably because you have an interaction with people - it's kind of very much a...
...face to face sale but also you have a...
...a clear demonstration of the product that you're about to buy.
I think when we look at other channels such as outbound, inbound or digital...
...it's actually much, much harder to kind of separate the difference between those customers.
I think when we consider the role of digital within our marketing...
...I think we kind of need to look at the role of technology per se.
And I think for us, technology has three benefits: it's about improving communication...
...it's about bringing you closer to the things you love...
...and it's about making life simpler and easier and a bit more convenient.
So then the question is: what role does Virgin Media play...
...using technology and particularly in the digital space and the social space?
And for us, it's about better connections.
So it's about better connections with prospects, better connections with customers...
...and most importantly, it's about Virgin Media enabling better connections...
...of those customers and prospects and their lives.
So when we look at better connections, we look at three specific silos, if you will...
And that's across help, discovery and entertainment...
So those are the silos, but then we actually have a model.
So we have a model that help, entertain and discovery kind of feed into...
...and so this is all about advocacy.
So we need to attract people to our social platforms, we need to stimulate them...
...we need to encourage participation, we need to reward that participation...
...we need to encourage sharing and that leads to advocacy.
And so that's really the kind of model that we apply across...
...YouTube, across Facebook, across Twitter, across, you know, all of those platforms out there...
...and we're using help, education and discovery in that journey.
So the challenge we face is that we are in a saturated, commoditised market...
...so growth is really, really hard to come by.
Therefore the business objective for this particular campaign was about retention marketing...
...it was about stemming churn.
We also know that from a customer behaviour point of view...
...people are using broadband more and more...
...therefore we need to land our competitive advantage...
- that is our fibre optic network - particularly when you have BT hot on our heels...
...with a product that is quite similar in Infinity but very, very difficult to differentiate.
So when you actually look at things like Millward Brown tracking...
...we actually saw the distance between ourselves and BT over the last 18 months...
...shortening in terms of superiority fibre.
Therefore we needed to do something transformational and game changing in order to say...
..."Virgin Media: fibre actually no-one comes close" and that's really the...
...thinking behind 'double your broadband speeds' for this campaign.
I think there'd be an additional reason why we would double people's broadband speeds...
...not just because they need greater speeds to...
...seamlessly live their digital lives, if you will.
I think the other is we want people to do more with their broadband...
...we want them to actually kind of flex that pipe as much as possible because by doing that...
...then we will actually have a much deeper relationship with that customer...
...the much deeper the relationship you will have with them.
And therefore if we come back to our original churn objective...
...that's something that would, you know, kind of be much, much harder for them to walk away from.
So if you're taking a DSL customer into a fibre space...
...and then a Virgin Media fibre space, actually the difference should be quite pronounced.
The first key element of any campaign is to be noticed and to be heard...
...and I think that digital, and particularly social...
...is a superb platform which is a two-way conversation in real time...
...that actually enables campaigns to get talked about.
And actually, you can have campaigns that run from the top down...
...or you can have campaigns that are created from the bottom up.
And this particular campaign needed notoriety because we operate in a...
...commoditised market there's actually quite boring - broadband is quite boring.
People see it as a dumb pipe, we see it as a entertainment enabler...
...but actually it's a bit like electricity, you know, it's not something that people necessarily think about.
So what we have to do is we had to kind of punctuate that apathy...
...with something that was irreverent and actually something that created talkability.
So we did that through the use of Usain Bolt, through the use of Richard Branson...
...and through the use of some clever media ideas.
But I think critically, because our budgets are limited...
...we needed to create a story that could run and run - that could run across Twitter...
...by the hijacking of Richard Branson and Usain Bolt switching...
...and through various competitions where actually...
...our Facebook fan base could send in pictures of themselves...
...who they might be you know, lookalikeys, you know, of other famous people.
But I think what's critical for us actually now when we look at campaigns...
...is it's not just the big TV spot...
...it is [1] what is the total integrated approach, and actually how can we continue that conversation...
...once the big £5millon TV campaign has finished...
The campaign was the most successful retention campaign in the history of Virgin Media...
...which is absolutely fantastic, it means I can stay in my day job for another couple of months I think.
...so of net promoter score in terms of...
...the reasons why people were staying with Virgin Media.
So just judging their satisfaction of broadband as a product and Virgin Media as a business...
...but in addition to that, it was voted the...
...the best campaign of the year by the kind of trade press.
It generated the biggest PR of any campaign that we've ever created.
Fast, fast broadband rather than cheap broadband...
...was the No. 1 search term on Google.
When we looked at actually the reasons why...
...people would join Virgin Media through a new joiner survey that happened quarterly...
...super fast fibre optic broadband was the No. 1 reason and that was the first time.
So there are, I think any number of metrics that showed that the campaign was a...
...got a gold medal.