The NBA has been saturated with advertising for a long time. From the Los Angeles Lakers’ Staples Center to the New York Knicks’ official beverage Pepsi, anything that could be sold for advertising space was sponsored, branded, and promoted.
There was still one stronghold that resisted advertisers, the jersey. But last year, the NBA announced corporate sponsors would be able to purchase a 2.5 by 2.5-inch patch of ad space on the left shoulder of NBA jerseys. Corporations immediately began scrambling to lock up the valuable ad space.
Jersey sponsors are routine outside America. Teams in English football leagues all the way to Australian rugby teams commonly sell ad space on their jerseys, and the profits are huge. In 2016, Spanish football team Barcelona penned a record deal with Rakuten, a Japanese tech company, worth as much as €61.5 million a year.
After seeing the success of jersey sponsorship abroad, most in the NBA figured it was only a matter of time until the league adopted new policies. In a 2014 interview with AdAge, NBA Commissioner Adam Silver said NBA jersey sponsorships were “inevitable.”
In 2017, an NBA decision opened the flood gates and teams began netting anywhere from $5 million to $20 million a year to sell the 2.5-inch square logo on their jerseys. Big name sponsors including Goodyear, General Electric, and Disney piled in to purchase the advertisements. The Golden State Warriors signed the largest deal in the NBA, scoring $20 million a year from Rakuten.
And while 2017’s decision to allow jersey sponsorships is technically a tentative, three-year trial run, there is little doubt the NBA will continue the advertisements. Why? Because according to GumGum Sports, a sports analytics company specializing in advertising, the jersey logos will generate over $350 million in value to these sponsors while NBA teams rake in money.
Jersey sponsorships offer companies a unique opportunity to reach their home market as well as abroad, part of the reason why a team like Barcelona gets such an exorbitant sum. Just ask Chevrolet, who spent $600 million to win the jersey rights of the English football club Manchester United. Chevrolet targeted Manchester United because its fan base has over half a billion people worldwide, nearly half of whom live in the Asia-Pacific region, an area Chevrolet is keen to target.
While European football teams are getting the biggest payouts for their jersey space, it probably won’t be long before you see NBA teams signing nine-figure jersey sponsorships. The NBA grows in international markets every year, and with that growth comes more opportunities for advertisers. Houston Rockets jerseys are popping up in China while Milwaukee Bucks jerseys proliferate in Europe. These jersey sponsorships will be worth more and more as the NBA continues to grow abroad.
The rights to advertise on a team’s jersey is a win-win for advertisers and NBA teams. Jersey ads offer brands a unique opportunity to reach an American audience, and pair themselves with teams increasingly popular worldwide. While purist fans may have their gripes with the new ads it’s unlikely they will be more convincing than the millions of dollars the league stands to earn each year. Who would have thought such a small ad could be worth so much?
The path to innovation is often set by trailblazing brands typically defined as “aspirational” in nature―ones a large portion of the market wish to own, but for economic reasons cannot. Often the supply of aspirational products is also limited, due to restricted distribution and/or production. Such was the case for years with luxury products. They were expensive, limited in production, and only available for a certain time; they we’re “exclusive.” Nowadays, what consumers perceive as aspirational may be changing.
Today, many aspirational brands are also attainable. We see people toiling at WeWork while also planning their vacations via Airbnb; their Fjallraven work bag stuffed with a four-pack of Ponysaurus craft beer for later that night. For today’s generation, aspirations are grounded in the attainable. Couture fashion is no longer Fashion Week for the elite, but rather the recent Galaxy Unpacked 2018 live-streaming event of the Samsung Note 9 phone, readily viewable for all. A democratization of aspiration.
What sets these “attainable aspirational” products apart, simply put, is they try harder to make the common more special. They don’t deliver anything necessarily all that different from their competitors (i.e., a desk to work, a place to sleep, a rucksack to carry, or a beer to quaff), but they approach their respective categories in a different manner. Their brands speak to their audience in a smart, confident, and optimistic tone and make them feel special, contributing to our emotional need to belong or be a part of something. Consumers readily embody these feelings, finding aspiration through attainment. Nowadays it’s the totality of all the little things in our daily journey―work, play, shelter, and daily necessities―that add up to a well-lived, yet aspirationally driven, life.
Which brings me arguably to the most attainable and rote purchase of all, buying food at the supermarket. We all eat and need to shop regularly, if not habitually. While retailers of all stripes are reinventing themselves in the face of Amazon, Whole Foods, Trader Joe’s and all the others seem to lose their ‘buzz’ of late. Where I live, in the Carolinas, Wegman’s is stretching into our state following fleeing Yankees heading south, while Kroger is leaving us for the promise of China via Alibaba. At the same time, Germany’s Aldi and Lidl are both gaining a valuable toehold locally. So much going on for such a simple task in our daily lives!
Yet, I’m not satisfied. While each of these chains has a unique position in the marketplace, I’m nostalgic for the experiences I encountered years back when entering Dean & DeLuca in Boston or Citarella in New York; regardless of the hard work and effort by modern retailers, we’ve slipped in delivering a memorable shopping experience. Recently, however, I discovered Zurheide, and I once again have hope, for Zurheide is the embodiment of the attainable aspirational experience. But there’s a hitch, it’s located in Germany, not North Carolina. But as both Aldi and Lidl have recently graced our shores, perhaps I won’t have to wait too long.
A recent review of the chain is available through an article in Monocle Magazine where the supermarket chain states “Zurheide is committed to turning an everyday errand into an unrivalled experience.” Their recent store in Dusseldorf, for instance, carries staples such as liters of milk and boxed cereal, but also contains three restaurants and five bars (have to love the Germans). The result is not a store, but that of a food hall, such as Faneuil Hall Marketplace in Boston or the Ferry Building Marketplace in San Francisco.
While you may think this is a Eurocentric concept, those involved in designing the store say they received much of their inspiration from visits to Canada and the U.S. “It’s all about selling the right mix: Twix next to truffles,” according to Heinz Zurheide, founder of the eight-store chain.
Zurheide may be a glimpse of what the future of ‘brick-based’ retail will become. Nothing is truly fixed, rather the physical space is built to evolve and change with consumer preferences. Rather than a large, overwhelming space, the goal is to create unique environments within, with moveable walls and displays, so one can assimilate into the shopping journey and explore beyond normative shopping behaviors. The store becomes the destination―the mundane of food shopping blossoms into an experience itself―attainable aspiration.
You’ve likely spoken with some form of artificial intelligence before, and chances are it’s been through your phone. These programs come with cute names like Siri or Bixby, but choppy language and misunderstandings expose the fact that these programs are simply that…programs. But AI keeps getting better and better, and with its newest iteration, Google Duplex, the lines between human and program are beginning to blur.
This May, Google debuted Duplex at Google I/O, its annual developer conference. The presentation began with Google’s CEO Sundar Pichai asking Duplex to schedule a hair appointment. Duplex dials the number and a woman’s voice answers and asks how she can help, Duplex responds:
“Hi, I’m calling to book a woman’s hair cut appointment for a client, um, I’m looking for something on May 3?”
The woman at the hair salon asks to hold for one second, to which Duplex replies:
Duplex then goes on to have a conversation with the woman at the hair salon to schedule an appointment and then hangs up. The phone call was impressive, but most notably, the woman never realized she was speaking to a computer program. The naturalness and ease of Duplex is years ahead of what’s currently offered on your phone.
In conjunction with the presentation, Google released a white paper detailing how Duplex works. In it there are multiple examples of Duplex booking appointments and reservations while handling obstacles like interruptions and accents.
The prevalence of AI will continue to grow as the use of “smart” devices has increased dramatically. Voicebot.ai, a publication dedicated to voice assistant technologies, reports over 20% of US adults own “smart” speakers than can house AI programs. Additionally, the Pew Research Center reports 77% of Americans own smartphones, many of which house AI programs such as Microsoft’s Cortana or Apple’s Siri.
As AI becomes increasingly common, programs like Duplex are poised to fuel economic growth in a way that drastically changes the nature of our workplaces. Receptionists and assistants aren’t the only jobs that will be impacted by advances in AI, nearly every industry will be transformed.
By 2035 AI could double economic growth rates according to a report on the future of AI from the consulting firm Accenture. AI is projected to increase labor productivity up to 40 percent, which will free up people to use their time for high-value tasks and increase operational efficiencies.
While the upside for AI to propel change and growth is huge, many fear it will bring increased unemployment and further technological detachment. Regardless of these fears, demand for AI products continues to grow and will certainly shape our future, whether we realize it or not.
It’s a busy world we live in today. There are a lot of good things happening nowadays―leap and bounds in technology and medical innovation, the potential for autonomous vehicles and automated everything, longer lives lived, and ever-present connectivity, just to name a few. At the same time, a lot of problems are ever-present―the increasing wealth gap, the spiraling use of deadly weapons, the re-emergence of despotic rule across the globe, and the overall ecological demise of our planet. As the saying goes, “it’s a crazy mixed-up world we live in.”
Which leads me to ask myself: How is my quality of life? Typically, I have been a “glass half-empty” kind of guy―blame it on my being both a Capricorn’s Capricorn as well as an only child; I’m always willing to account for the downside of a situation. Yet, I do lead a really good life, and I consider myself one of the lucky ones. I guess you could call me “cautiously optimistic.”
Given this, I think there’s always room for improvement, even for a lucky one like me. That’s why I’m always on the lookout for ways to assess, then improve my lot in life. For a while I would attend TED-type conferences but eventually found them a bit too ‘lofty’ and self-aggrandizing; on the flip-side, I’d trek to Burning Man, but found the hedonism and general silliness outweighed the sheer force of the event, and soon the buzz wore off.
This year I found something that looks a bit different, a conference that contains a set of speakers who seem quite grounded in the realities of addressing quality of life in today’s world. No silver bullets or bombastic kernels of wisdom, but rather the tact of taking a particular city that treats its citizens well, in this case Zurich, Switzerland, and use it as a case study in context to demonstrate how aspects of daily life in Zurich, and beyond, are addressed and supported by its citizenry.
Hosted by Monocle magazine, the Quality of Life conference will be held this June 28-30 and is scheduled to address a diverse, yet interrelated, array of topics key to quality of life, including architecture, entrepreneurship, work, mobility, safety and security, health, aging, food, retail, and art and design. All of these Zurich does quite well, and the hope is that attendees see such demonstrations on the streets of Zurich, hear related stories from speakers at the conference podium, and discuss among themselves how such things can be brought back home.
Quality of life is a broad subject to tackle. Overall, I feel they’ve laid out a good breadth of perspectives to address the subject (though the absence of spirituality and/or self-discovery is sorely missed―but then again, I’m an American where nowadays such topics are de rigueur regarding quality of life issues).
Being ‘cautiously optimistic’ I also have a few doubts about the locale, given the Swiss legacy of secrecy, as well as the Anglo-monolithic demographic composition of the place. Yet, from a global perspective, Zurich has a lot of things to envy―the Swiss have a zeal to get things precisely ‘right’ and Zurich is their crown jewel.
Monocle has proven experience in hosting such conferences, albeit strictly from a pan-European lens (e.g., Lisbon, Vienna, and Berlin), though attendees are from further afield. One can hope those lucky enough to attend bring something home to their own little corners of the globe, making things a bit better for us all.
Every once in a while, we like to share what we’ve been up to, including how our research engagements have helped our clients achieve their business goals and some of the lessons learned. This study highlights W5’s role in assisting an appliance company in empathizing with their consumers through Personas research.
A leading home appliance distributor sought a better understanding of the marketplace to identify the perceptions, attitudes, motivations and unmet needs of category consumers. Ultimately, the client intended to use the research to inform both product and category innovation, and to improve the related retail experience.
W5 recommended developing behavior and motivation-based consumer personas following extensive in-depth qualitative research. Persona research was conducted in the form of hour-long in-home interviews with a diverse representative selection of appliance consumers. In preparation for the interview sessions, each respondent completed a comprehensive diary exercise exploring the emotional, functional and social aspects of recent appliance use to help stimulate thoughtful category engagement.
Based on this extensive in-context research, W5 developed and presented consumer personas to the client, each with unique lifestyles, product usage behaviors, product research and purchase behaviors, and category opportunities. Personas embodied the in-depth research findings as a memorable, accessible tool that operational units across the organization could use to anticipate consumer needs and desires, based on an empathetic understanding of their conscious and unconscious behaviors.
As a veteran of academic conferences, I was excited to attend my first market research conference at the Quirks 2018 event in Irvine, CA. My experience was illuminating, teaching me more about my own role, and the roles of the other players in the market research ecosystem of clients, products, and services.
Being uninitiated in the world of industry-centered conferences, one aspect of this conference that stood out was the co-mingling of information-sharing with the marketing and selling of products and services. Commoditizing research and research tools in this way can lead to a problematic shift in perspective in which approaches and solutions become disconnected from the questions and problems they purport to solve.
It makes sense to stress capabilities over limitations. When trying to earn a place in a client’s budget, it seems logical to want to promote a product or service as more versatile and therefore more valuable. All around the conference, products and services were often sold based on their versatility, on all the problems for which they were the solution. As I talked to exhibitors at the event, each seemed to promise me more in-depth insights with more participants on faster timelines: more bang for my buck. But when it comes to research, that tactic is highly misleading.
The truth is that research approaches or tools are limited in the kinds of questions they can answer and the kinds of insights they can provide. Knowing what a research approach or tool cannot do can be just as important as knowing what it can. In-depth ethnography can provide intimate insights into consumers’ lives, but it can’t quantify those insights into reliable statistics like a quantitative survey can. A large-scale survey can provide reliable statistics, but it cannot explore individual nuances like qualitative research can.
Proper research starts with questions, not answers. There’s a saying that I like to remind myself of when designing a research approach: “If all you have is a hammer, everything looks like a nail.” As market researchers, we need to be careful to make sure that the approaches we take are born of the questions we are trying to answer for our clients, and not the other way around. Otherwise, we risk limiting our research impact for our clients with one-size-fits-all solutions that actually fit no one.
I think automation is just getting going by the likes of Amazon, autonomous driving, and behavioral algorithms. Should it follow typical diffusion of innovation models, our future will soon be on auto-pilot. And not just driving, but lots of stuff that is repetitive and easily replicated, such as factory work, construction, food prep, transportation, insurance renewals, and financial services transactions will soon all be executed by autonomous artificial intelligence (AI). Entire industries will be on auto-pilot, more or less.
This means a lot of people will no longer be needed to do that work as robot-to-worker ratios soar. What will these people do? I’m sure they’ll be a lot of political bluster and reflexive pullback, but in the end, I think these people will simply not have to work. How will they earn a living then? Maybe they won’t have to worry about that too much. One solution I hear more and more about is Universal Basic Income (UBI). UBI is basically giving people a certain amount money, a basic income, free of charge or obligation. No needs test, everyone gets a stipend, regardless of current status.
As a typical industrious American, my initial reaction was not positive. Overall, it just sounded lazy and, in the end, not beneficial to those receiving or giving; nothing breakthrough, or even clever about it. But then I did a bit of homework on the matter, and my opinion is starting to change.
While the concept of UBI may sound like the outcome of twenty-first century liberalism, it’s roots are old and deep. Over two hundred years ago one of our Founding Fathers, Thomas Paine, advocated “a citizen’s dividend to all United States citizens.” Noted Nobel Prize-winning economist F.A. Hayek promoted a “wage floor, which nobody need fall even when he is unable to provide for himself.” Even current conservative man of the moment Paul Ryan has proposed that states commingle different forms of federal anti-poverty funding—food stamps, housing assistance, and more—into a single funding stream.
The thought is that free from the constraints of having to [continually] prove a ‘needs-based’ model to receive assistance, all people would have a basic ‘floor’ from which to build their lives, say $10,0000 per year. From there, people could control how to direct their lives, rather than living a life prescribed by the government―a blending of neoliberalism and reform conservatism.
Proponents of such a model believe we’d see a rapid reduction in poverty and crime, and an increase in creativity and innovation―especially among the young and old; to those most vulnerable, ten grand a year would mean the world.
Pieces of such a model already exist in one form or another, right here in our country. For years the state of Alaska through the Alaska Permanent Fund has made an annual distribution of thousands of dollars to all state residents―absolutely free money. Stockton, California’s 27-year old mayor is getting ready to pilot a program where all residents of the town will be given $500 monthly, no strings attached. Further afield, the UBI model is currently being discussed, tweaked and/or tested all over the world, from Finland and the Netherlands, to France, India, and Kenya; the nature of the concept is not constrained by geography, politics, or current economic strength. I find such an idea very intriguing.
While there are many arguments for and against UBI, the fact remains the idea is quickly gaining traction as we evolve from an industrial-based world economy to an information-based model. The vast effects of such a rotation are not yet fully comprehended by financiers, politicians, and certainly not your Uber driver―who may soon need it most. Yet such a fundamental shift will require an equally radical response to counter the effects of this transformation of toil. UBI might be a step in that direction.
If you want to part of the solution and help the extremely poverty stricken today, go to Give Directly and launch a UBI of your own for someone less fortunate.