I attended Cannes Lions, the massive annual advertising “festival.” I quickly learned that Cannes Lions’s reputation as an epic boondoggle is well-deserved, with endless food, adult beverages, celebrity appearances, and parties, including many on yachts. And yet, amidst all the revelry on the Riviera, a lot of business gets done. In addition to many participants’ schedules of back-to-back meetings, there are ton of top-notch presentations whose content will have me thinking for a long time. My takeaways are by no means comprehensive, as I was only able to take in a tiny percentage of what was on offer. I guess I’ll have to go back next year.
One overarching theme came up in many of the presentations that I attended: the importance of humans and human interaction over artifice and technology. This is not a novel idea, as pundits have been beating the drum on this for quite a while. The twist at Cannes is that marketers, who have to care about the bottom line, feel strongly that this is an important cultural shift. We all know about the mass frenzy and joy surrounds Knicks’ championship run (which, yes, was referenced many times) and may have heard about the impressive summer box office numbers. The speakers the I heard added insight into what is going on.
Here are few quotes from executives from ImBev, Heineken, Kraft Heinz and other leading marketers:
“It’s important to sandwich human/tech/human”
“The community funnel is the marketing funnel turned around”
“There’s a changing relationship between the brand and the consumer”
“Gen Z is much more skeptical than the prior generation”
“People making a story on their own is much better than paid content”
The Reddit presentation was standout. The company pointed to AI as a key and a perhaps less recognized factor in the desire for authenticity and personal connections than usual, and certainly valid, suspects of Covid quarantines, overdose of screen time, political polarization. They noted that for 20 years the internet was for accessing information, but now people use it to optimize human connections. They stated, I think accurately, that people are often skeptical of AI, using it to look something up and then, because of negative experiences, verifying what they’ve been told. Reddit pointed to its extremely popular (2.8mm visitors and 120k contributions in the past week) forum, “AmItheA#%hole,” where people pose questions such as “AITA for telling my neighbor to stop using my driveway as a turnaround spot?” Many of the responses are in the vein of, “yes, you are an a#%hole,” while ChatGPT et al answers are, as you may have learned, very affirming, telling you that you’re brave or whatever, often to the point of seeming ridiculous. While some people no doubt love not being criticized, many prefer authenticity.
Coach CMO Joon Silverstein was also terrific, sharing a really interesting deep dive on the company’s extremely successful targeting of Gen Z customers. The strategy involved an 180 degree pivot from Coach’s longtime focus on retaining customers to acquiring new ones, and focusing on the 25M women in its core markets who turn 18 every year. Silverstein stated that Gen Z is disinterested in “aspirational luxury” and status symbols, and is focused instead on authenticity (there’s that word again) and “expressive luxury.” This analysis, which incorporated research indicating that Gen Z reads more physical books than any generation and that readers see books as an expression of their identity, led to the successful “courage to be real” campaign.
Next, a great article that relates to a niche fascination of mine: how dress codes change slowly, but sometimes, because of an exogenous event, very quickly. For instance, an 11-day New York City in 1980 transit strike caused hordes of women to wear sneakers en route to the office. These women then got into the habit of buying sneakers for purposes other than sports, and you know what happened after that. The article is about how a massive heat wave in 1936 led to an important change in dress codes. It’s such a fun piece that I’m reluctant to spoil it, but here’s a taste:
“In Yonkers, on June 21, two reporters from the New York Daily News —hoping to test the city’s anti-shorts law—were arrested for wearing shorts in Yonkers after a hike. They were given the choice to leave the city or put on more appropriate clothing. They refused and were eventually brought forth before city judge Charles W. Boote. The judge was probably sweating underneath his robe when he made his decision on July 10, when the high was 102. Boote was sympathetic to the journalists, fining them $10 (adjusted for inflation about $240) but suspending the fines.”
Read it here.
Separately, the article I’m waiting for is an explanation of why so many academics and literary types love extolling the virtues of Costco. Don’t get me wrong, I think Costco is great, but the ongoing outpouring feels like a bit much. I can’t fully explain the phenomenon, but I do think it has something to do with knee-jerk hatred of Walmart by people who have probably never been to a Walmart, and animosity towards Amazon by writers who despise it for supposedly destroying the publishing industry. Anyway, this article is yet another paean, but I think it has some fresh insights. It extols Costco as the anti-Amazon, but the author has done his homework – this is the first piece in the genre that I’ve seen that talks about quaint topics such as cash flow. Pull quote:
“One brilliant feature of the Costco experience is, paradoxically, the constraint: as opposed to Amazon, with its near infinite assortment, or even Walmart, which has approximately 130,000 SKUs (stock keeping units, or distinct items) in the average Supercenter, any given Costco will only hold 4,000 SKUs to choose from. While most retailers today assume that consumers want ever greater assortment, Costco’s popularity speaks to a countervailing desire for less choice. Indeed, the pre-selection of items for sale in their warehouses is part of the value proposition: not only are you going to get a lot of a particular thing for a good price, but you also won’t have to deliberate over micro-differences in a more robust assortment.
In other words, winnowing selection is a service, not a limitation—especially with Costco’s product catalog. Costco is not known for having the cheapest goods, but it is known for having the cheapest price on its goods, and that is because its buying team has closer relationships with suppliers than any other big retailer. Such scrutiny and communication point away from low-road suppliers. This is a structural effect of Costco’s conscious choice to offer a low SKU count: fewer products to investigate means more time to investigate each product, and a natural gravitation away from the bargain basement. That its member-customers have come to expect a certain quality of everything in their stores reinforces this dynamic.”
The last article that I’m sharing is a longread on the “Loss Prevention Council,” which the author describes as “America’s leading lab to prevent shoplifting.” Members of the council are a who’s who of American retailing. The article includes an account of the author’s visit to the Council’s simulated store, “with its unparalleled density of anti-shoplifting technologies,” as well as his attempt to get away with shoplifting at Walmart after his tour.
Faye Landes advises emerging consumer companies, including footwear, apparel and accessories brands, on-line retailers, and fitness concepts on general strategy, hiring, scaling and fundraising. Faye’s work is informed by her career as an analyst at Cowen & Company and Consumer Edge Research as well as her time as a guest lecturer at Princeton’s undergraduate course in entrepreneurship. To join her Weekend Reading mailing list, sign up at faye@landesadvisors.com.
