ASTRA Keynote Address – FOX International Channels, 1.45-2.15, 4/9/2014
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Our journey is just beginning.
From lifestyle to life changing.
From the crowd immersing themselves in the dance.
We shape your space.
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Huge blockbuster.
The Australian Subscription Television Industry. We've got quite a story to tell.
BROOKE CORTE:
Welcome back everyone.
We have our next sponsored keynote session today and we're hearing about the
evolution of FOX International.
To introduce our next speaker, please make welcome FOX International's MD,
Jacqui Feeney.
JACQUI FEENEY:
Hello everyone.
FOX International Channels. For those of you who don't know, we're the channel
production distribution and content production distribution group with very
deep roots. Many, many channels. Largely through Latin America, Asia, Europe,
pretty much - and in Australia it is just FX and National Geographic.
But we represent the Fox brand and the Fox channels in many countries around
the world, including Fox Sports and the various Fox entertainment channels, but
just not in Australia.
Very, very happy to be able to introduce - firstly, I'm happy to have a marketer at
this conference. I think that's a nice development in the last couple of years.
It is my great pleasure to be able to introduce you to Liz Dolan, who is our CMO
for the global group, and so she has the task of herding the cats, if you like, across
the many countries.
One of the wonderful things about FOX International Channels, it has all the
benefits of being all the global infrastructure but unlike some other global
brands, it is very localised in and it is quite different in different markets. Which
actually is a strength. Although probably adds to the chaos at times, I'm sure, Liz.
Anyway, Liz has been with FIC since 2011. Before that, she joined us from the
Oprah Winfrey Network when it was brand-new and setting that up in the US.
And prior to that, she was CMO at - or, you know, various
titles, you know, the Vice President of Global Marketing for NIKE.
We've had her in the office for the last day or so. We've taken her to Foxtel. She
has seen IQ3, so it is all fantastic.
Liz also has a history in a radio show called Satellite Sisters, which now is a
podcast available if you're interested to hear more from Liz, and she's just an allround, fabulous person.
So I would like to introduce Liz and welcome you to the stage, Liz. Thank you.
LIZ DOLAN:
Thank you so much. Thanks. Hi. I love being in Sydney. I was so excited when I
got the call a couple of months ago inviting me to speak here and it is one of my
favourite cities in the world and I was happy for any excuse to come back.
Until - until - I discovered that this conflicted with the Simpsons marathon on
FXX in the United States.
As you may or may not know, it just ended - thank goodness - so I could spring
myself, make myself available.
But FXX, which is the comedy FX Channel in the United States just ran a
Simpsons marathon of every Simpsons episode ever!
It was awesome. And it got quite a bit into the productivity of many Americans
who have grown up with that show. So I managed to tear myself away.
It did put FXX on the map, which was the goal of that. And there were several
nights during the Simpsons marathon where it was the number one rated
network in the United States for 18 to 49.
So, luckily, the schedule worked out fine.
I just wanted to say, before I start, as you can tell from my title, I don't have any
data. I'm not going to show you any charts. I am not going to make dramatic
predictions. I am not going to analyse the past or the future.
I kind of feel like Lloyd Dobler in the John Cusack speech where he says "I don't
want to buy anything that is bought or sold. I don't want to sell anything that is
processed or bought".
I just wanted to, when I got this topic about thinking about change, I just started
to actually think about change. And what that means in our business, the TV
business. But also what that means in general in marketing and branding
because most of all, at FOX International Channels, we are about big, strong,
television brands and making sure that continues to be true.
So, some musing from me, please indulge.
I was thinking about when I started in marketing, it was in the 80s, I had just
gotten out of college, I was working at a big agency in New York City and I would,
you know, I would walk to the subway, listening to Madonna on my cassette, you
know, it wasn't really vogue then, it was like a virgin then, but you get the idea. I
would listen to a cassette. I would get to the New York City subway system. I
would take my beloved token and put it in. I would get to the office where there
were floppy disks involved and there were answering machines involved, and
there were actually physical Rolodex’s that was a sign of power and if you had
multiple Rolodex’s, boy, were you powerful.
So I was thinking about that and obviously none of those things exist anymore.
Those are all gone. All the tools of our trade, you know. When I first started out
in this field of marketing, those are all gone.
And, by the way, that first job I had getting out of college was at the oldest
advertising agency in the United States. It was called NW Ayer. And so you can
predict the punch line. They don't exist anymore either. So they're all gone.
Then I started to think about my first ever business trip because my client was
European. I went back and forth to Europe a lot. I flew then on Pan Am, which is
dead. I used Francs, which are dead. I came home and drove a Car Sob, which is
dead. I would hang out in New York at Tower Records - this is my Saturday
afternoon activity - down in East Village, which is dead. And that is actually my
picture that I took of the "Going out of business sign" at Tower Records.
Anyway, this is all by way of saying change is inevitable and we have had this
dramatic amount of change in our lives. These aren't necessarily bad things that
died. These were brands that we loved and brands that we used or iconic things
like a New York City subway token. So, you know, I don't have to tell you, you
are in the TV business, life moves on. But it does make you just stop and think
about all of the things that are already gone that used to be incredibly important
parts of your lives.
So, this is my marketing philosophy. And this, of course, is ripped off from
someone much smarter than me. His name is Ted Lovett. He was an editor at
the Harvard Business Review for many, many years. And he did things like he
coined the term "Globalisation". He also wrote a book called "Marketing Myopia"
and I could probably diagnose some in the room right now, because I know that
we all suffer from that, starting with myself.
And one of the things that Ted Lovett said about the difference between being a
B to B business and being a B to C business, which I think we can all admit, this is
the transition we are all in right now, whether we want to be or not. Right. Is
that people don't actually want a quarter inch drill. What they want is a quarter
inch hole. And it seems so obvious and I know it is a simple observation. But I
find that we spend a lot of time at work, in any business - I'm
not just talking about TV - sitting around like designing a better drill as if that is
the end. As if that is our process that is supposed to be the drill.
That is not the end. That is just the means to the end. The way the Rolodex was
or the floppy disk was or, you know, the subway token was.
The more we really focus on satisfaction of a consumer; in other words, the
quarter inch hole, the more we open our mind to what is really the quarter inch
hole, the more we can thrill our drills that don't work and move on.
And, you know, the speed of change in our business is so intense. I was thinking
about the fact that, you know, my elderly parents would occasionally call me, my
father would call, and he would say "Elizabeth, the Internet is broken". I'm sure
you have gotten these calls, right. "Can you please come and fix the Internet?".
So I would go down there. They live not too far from me in Santa Monica,
California and I would go down there, and I had the power to fix the Internet
because his computer was not plugged in. Or it was dial-up days and "Dad, you
have got to put the phone line in the phone".
Anyway, so I could fix the Internet but I knew no matter how many lessons I
gave, my parents were never going to learn how to use the DVR. Forget about
VOD. I tried that a bunch of times. "Look, you can go into the movies". No, that
was never going to happen.
So we feel powerful being in the middle, like I can fix the Internet, but I can't
teach them how to use a DVR. But then, the most humbling moment is when you
are standing with kids in your family and you see a five-year-old walk up to a
television and just go like that. Just start swiping at the television. That's when
you know you're screwed, right. That's when you know, like, the pace of change,
like a five-year-old is now smarter than you. And that's what we have to adjust
to. It is actually true.
I know because I just bought a smart TV. My TV is smarter than me. And I
believe a five-year-old would probably operate that TV better than I can. But I
still like to remind myself that at one point in my life, I could fix the Internet.
So thinking about - just think about what the hole is and if that is different in
every one of our businesses - so I'm not here to tell you the answer to that too but another thing Ted Lovett says is creativity is thinking up new things. I think
we are all pretty good at that. But innovation is doing new things. So we are in
this terrifying time where we have to, like, place some bets. You know. We just
have to decide we are going to do this and not that.
And it is terrifying. But my attitude is nobody knows the answer. Nobody knows
what is actually going to be true. You know, the three years from now, five years
from now, 10 years from now, you can't really know.
We are kind of at a point, I think - sorry all you analytical
people with your charts and graphs - we are kind of at a point where, yeah, you
to have read all of those things but then you have to figure out, like, what's in
your gut and go for it. And so that sort of innovation of just placing your bets,
crossing your fingers but going all in on a strategy, that is kind of my approach.
Which is why so much of what we are doing at FOX International Channels right
now is about brand consolidation. Going from a business where four years ago,
we had like 45 different channel brands around the world. Because we are in
180 countries. It is like any time somebody could get a channel somewhere, they
would name it something and call it a brand and, you know, off to the races.
Well, those are not brands. So I think I spent the first two years on the job and
people would say "Well, we have this, you know, like all elephants all the time
brand", or whatever it was, I'm like "Okay, that may be a channel but that is not a
brand".
And so we have really tried to consolidate our thinking inside the company about
it's about Fox, it's about National Geographic Channel, it's about Fox Life and it's
about Fox Sports.
And those are the global brands. And everything we do needs to be innovating
the consumer experience within those brands.
And obviously FX here in this market is a subset of the Fox brand. Apparently we
are not allowed to run the Fox channel here. I don't know what happened with
that. But anyway, we have got FX. Very powerful brand.
So, the thing that Ted Lovett always said in all of his articles is that the
fundamental question, which is really hard, people - it is really hard to focus in
on the answer to this, it seems so obvious - is what business are you really in? I
imagine that there are people in the room that would say you're in the Pay TV
business. Or you're in the television production business. Or you're in the ad
sales business. Or you're in the audience measurement business.
I don't see that business, our business, that way at all. Obviously which is why I
have no charts and graphs. You know, I think that for us, what we have to focus
on in a branded destination business, is creating and satisfying the demand for
entertainment. Again, seems incredibly simple.
But think about the amount of time that you spend in your current jobs doing
something that really doesn't deliver that. Because I suspect what you're doing
is fixing the drill. And, you know, instead of thinking about the hole.
So, I don't know how to do this for everybody's business but I just know that in
our own world, when we try to think about what are we really doing for the
National Geographic Channel, for that brand, making that more relevant, how are
we creating demand for that and satisfying demand for that.
And this is where I know this morning when Gerhard was talking about the
Millenials and all of that, that is really, really a significant challenge in our
business. I mean, I obviously we all know that. But the idea that people - that we
know the National Geographic Channel, that brand is one of the strongest brands
in the entire world. Certainly one of the strongest television channel brands in
the world and I need to get Millenials interested in that brand, no matter what.
Almost even if they're not watching conventional television, I have to figure out a
way to engage them in our brand. And we spend a lot of time working on that.
So, here is the really bad news from also from Ted Lovett. He said the history of
every dead and dying growth industry shows a self-deceiving cycle, right - that
phrase really cut to the quick - self-deceiving cycle of bountiful expansion and
undetected decay and the top two things that create the cycle are the belief that
growth is ensured, because we have this growing population, and the belief there
is no major substitute for the industries major product.
So, clearly, there are a lot of industries you can look at, you know, like music and
others where they have already fallen prey to this but, you know, it is our job to
make sure we don't find ourselves in this self-deceiving cycle because we have
the ability in the short-term to sell more subscriptions or drive more ratings.
You know, to think long-term how are we creating demand for entertainment
and satisfying it needs to be the game.
The good news is there is always going to be a demand for entertainment. So we
are safe in those ways. I'm not trying to bum you out too much.
So, in my history, I've, you know, done things well outside of the television
business. And as Jacqui mentioned, for a long time, I was at NIKE and I ran that
marketing department. I started there in the PR department. So I was always in
communications and marketing. And it was during a real growth spurt in that
business. And you look at NIKE now and you think, well, you know, they just
nailed it, they figured it out and now it is just a machine.
I was there at a day where, I have got to say, we were like totally floundering. It
was the nuts running the nuthouse. We were all about 11. We really had no idea
what we were doing. We had gotten lucky with a couple of products and then we
were still trying to figure out, like, how do we make this business bigger? And
we actually had this chart on a lot of walls around the office.
This was the massive plan for how we were going to grow NIKE. It was what we
called "The footwear spectrum people". Of course, you are familiar with the
footwear spectrum, because who isn't, right. Clearly, footwear spectrum,
everybody knows this.
So we actually had, in our minds, the idea that we were a shoe company and that
our job was to make more shoes.
So, you don't know this because things failed so spectacularly,
that they never even made it to Australia. So we had NIKE at the far end of the
footwear spectrum and then there was a time when we launched a women's
casual brand too, as a matter of fact, which was lost to history. We launched a
men's casual brand. Lost to history. And we ended up buying Cole Haan which is
a brand that still exists. We had convinced ourselves - going back to Ted Lovett's
question: what business are you really in - we had convinced ourselves that we
were in the shoe business which, like, was a really stupid answer to that
question. And it almost killed us.
So there was a certain point, once we were failing in all of those other three spots
on the footwear spectrum, where there was actually a light bulb moment where
we said "Wait a minute. We are not a shoe company. We are a sports company".
And it was like, hallelujah! Everyone in the room was like "Yes, what have we
been doing all of those years". We finally figured it out. It was already an $800
million company and we figured out, in that moment, like, we should not be
doing - we don't really care that much about shoes. We care about sports.
And that was the moment that unlocked a whole vision for a brand. That is when
NIKE really became a brand. Because then we could expand into apparel and we
knew exactly what kind of apparel we wanted to be. We could expand into
equipment. We could expand all over the world because we knew if we were in
Australia, we had to be involved in the sports that were important here or
Germany or you name the market.
The meeting where the light bulb went off, we were an $800 million company
then and it is a $26 billion company now.
And it is because we answered Ted Lovett's question correctly: what business
are we really in. You know, it is hard to remember, to think back to the time
where NIKE was not perceived as a sports brand, but that was, believe me, I
probably have some shoes in my closet that, wow, I should have burned many,
many days ago.
Anyway. So the footwear spectrum is just my experience with a self-deceiving
cycle. I think that is what that is. It is my experience with what it is like to
answer the question incorrectly. What business are you really in. And you think
it is obvious and it is just not so obvious.
So, then I think about the way we think about our business and our brands now.
So obviously the National Geographic Channel is a brand for whom I have great
love. I spend a lot of my time on that GO. In fact, Jacqui and I are headed to
Washington DC next week for the big programming marketing conference.
And we have all seen these charts where you take, you know, you take your
channel brand and you line them up next to the other channels that are right in
the space, and you try to slice and dice your channels. So while you have a little
bit more of this because they are a little bit over there, and I
just think it is not really that useful a way to look at what a brand needs to be in
the world.
I understand why, if you define yourself very narrowly that we are in a Pay TV
business and we are going to slice and dice these viewers and these channels, it
seems like the right thing to do. But it is not actually going to help unleash the
National Geographic brand.
We have - I don't know that there are any others in the world really - the only
television channel brand that pre-exists the invention of the television. You
know. That is actually kind of a cool thing to think that Nat Geo exists out there
in the world before TV and if it goes away, we are good, you know. It still stands
for exploration and curiosity and obviously we want the television experience of
Nat Geo to be as relevant and as vibrant and as inspirational as it can be. It has
to deliver on all of the values of exploration and curiosity, just as the Nat Geo
explorers do, just as the cruise that somebody is going to win tonight, that
Galapagos cruise. I'm actually booked to go this Christmas. So whoever wins, I
might see you on that boat this Christmas.
But we are very lucky to have a brand that has very broad tentacles. And it is our
mission, when we think about how to make that brand super present in people's
lives, to exploit all of those things.
So we don't really want to define ourselves that way. Though obviously that is
our narrow competitive environment, just the way, you know, shoe companies
for a while were in their own competitive environment for NIKE, this is sort of
the open-ended way, I think, of the National Geographic brand, that it is this lens
through which you see all the things you are interested in in the world and it is
our job to excite you and inspire you and get you out there, exploring the world,
and it is a struggle because obviously we do have some really, really smart
competitors in the Pay TV space doing a similar kind of job.
But when I think about a show like Cosmos this year and the time and effort that
went into Cosmos, which turned out to be the highest rated show ever in the
history of the National Geographic Channel, 135 million people saw that show, it
was one of the things that made us really proud to do. Because it felt like the
kind of show that only Nat Geo would really go for. It is back to the idea of like
taking the big swings, just deciding who are you really and stick to your knitting
when it comes to that.
So, all of the, you know, everything we are doing now with Nat Geo is trying to
get to those roots of what does it really mean to stand for the best in exploration
and curiosity.
So, I haven't answered any of your questions, I know, because I'm just talking
about me and my problems. But I think my problems are probably the same as
your problems.
I think inside our companies, and as Jacqui said, we are very far flung, we are in
180 countries, I sit in my little perch in Los Angeles and try to, like, help figure
out what is going on all over the world, but it is really pretty damn hard to know
what's going on. And you never want to go in and tell a local team, like, you don't
get your own people because, of course, people do. As long as you remind them
that that is their job.
I think our biggest challenge - and it came up in every presentation this morning
- is that we need to know more about our consumers. So, yes, there is room for
data in our lives. I understand. I will admit that.
We need to know more about our consumers. In our case, our consumers are in
every single country in the world, so it's a pretty hard thing to stay on top of.
Their behaviour is changing faster than ever. You know, as I say, the five-yearold swiping the TV, every time I see that, I'm like "Oh man, I'm never going to be
able to keep up".
But internally, and this is really what I spend a lot of time thinking about at a
company as big as FIC, is that there is no one discipline in any of your companies,
certainly my company, that can really tackle this challenge on their own.
The research department is not going to figure it out for you. The programming
department is not the only one that knows what to do. The marketing
department can't be the only people that are focussed on consumers. Getting rid
of silos will be the key to any future success in any of our businesses.
And that is really unbelievably - I would predict that the most radical thing that
will happen in our business over the next three to five years is that we will
completely reorganise the way we work inside our companies.
There need to be completely different types of teams. And, again, I have no idea
how to do this. You know, I have figured out now at least what I'm trying to
accomplish, but I know that sometimes I go in, because I spend most of my time
travelling, but we have a big office in Italy, Fox Italy has lots of channels, and it is
very vibrant and I will go in and I'll meet with people and, you know, I will talk to
the marketing department and then the on-air department and then the digital
department and then the programmers, and as, you know, I troop around the
office in Rome, I'm realising as the day goes on, that I'm talking to all of these
people but these people are not talking to each other because they have very
narrow definitions of what their actual jobs are.
That is not the path to success. I'm not exactly sure what is. But I know if you're
marketing and you're programming and you're digital and you're on-air people,
are each in such a path that they don't have time to really create new ideas with
each other, then it means that everyone is just working on the drill. Nobody is
looking at the hole anymore. Everybody just has this drill or
this piece of a drill. It is just about tinkering with the components.
It's human nature that this is the way you work. But I believe that if we continue
to work that way, we will miss the big opportunities that will come with all of the
changes that are coming our way.
Technology is an awesome thing for our business. Nothing could be better than
to be able to take our great content and get it to more people, everywhere, more
efficiently, have them to be able to interact with that. We are not just in the
golden age of television creation wise, it means we can satisfy what always,
always needs to be satisfied, like, consumers ultimately always get what they
want. That is my number one rule in marketing. They are always - sooner or
later, they are going to get it. And you're going to invent it. Or you're not.
Somebody else is going to invent it. But sooner or later, consumers are going to
get the kinds of shows they want, delivered the way they want, at the price they
want. We live in this technological age where that is inevitable.
So how we do that individually, inside our own organisations, I think is going to
make the difference between winning and losing. I don't think it is going to be
some, you know, somebody's going to cook up, like, the solution, like, that is
going to be some technical wizardry that makes that happen. It is going to be
human capital, working together, that is really going to make that happen.
So, for us, we work really hard to be connected in all dimensions. I'm sure you
do too. And we all know how hard it is.
I have a new rule in my department that when we are talking about how to solve
a problem, no-one is allowed to give a solution to the problem that involves
sending an email. It always feels like, well, how come nobody in Finland
understands that blah, blah, blah, blah, blah. And somebody will always say,
"Okay, I will send them an email and tell them". I'm like "We have told them 15
times". There has to be another way to do this. A better way to communicate. A
more engaged way to build the team. The people can only execute the strategy if
we arrive at it together and they know what it is.
So we work really hard on this part of it. On being connected in all the
dimensions.
And this is one of my, you know, a guy that I quote a lot is also Akio Morita. This
is something he said a long time ago, but I think it is more true now than ever.
That there are three creativities: creativity in technology, in product planning
and in marketing. And to have any one of these without the others is selfdefeating.
That is what I mean when I say that that's what we are working on inside FIC.
How to, like, we can have the fancy players, like looking at the IQ3 demo
yesterday at Foxtel was awesome. I would love to have that in my home. I don't
know if it can be licensed to Time Warner Cable but that
would be fantastic. But what you could see in that product was a thought of it
wasn't just technology, it was how I would actually want to watch TV. It was the
how it will be marketed. It was a total 360 approach to creating and satisfying
demand for entertainment.
So, whenever I look at this quota, it is like he was right, Akio Morita. It's too bad
his own company, you know, ultimately stopped doing that and so they are not
any longer the technological leaders. But there was a moment where they were
leading all of this.
So I'm just going to go back to this. I know it is simple. People do not want a
quarter inch drill. They want a quarter inch hole and I feel a little bit like - sort of
like a cross between Bill Murray and Yoda when I say "Be the hole".
That's it.