E150 | Reimagining High Fashion Through Tech with Rod Banner
If you’re pondering what to do when you exit your current business, or you’re thinking of a retirement project, let serial entrepreneur and self taught technologist, Rod Banner, inspire you in your next steps.
Having spent years helping businesses become world dominating brands through sharp advertising, today his focus is on the architecture of business. As CEO of 3LA, he leads a collective of brains that help technology firms become more agile and relevant.
Rod founded 3LA having sold his hugely successful advertising agency, Banner – the biggest and most respected B2B agency in Europe, to WPP. He’s also the founder at JoyTech.org, a project that explores how to stop tech companies marketing us into madness but, instead, bring more joy to the world.
But that’s not what Rod discusses in this latest episode of The Melting Pot. Today, Rod ruminates on what he would have done differently if he’d had his time again. How he’d be more deliberate about creating a plural life. Because that’s what he’s living.
For example, during lockdown he became involved in a project reimagining high fashion and technology, trying to link high fashion to consumers through tech, and what that might look like – because tech is truly where Rod’s heart lies.
This is an incredibly fascinating, wide-ranging conversation, we hope you enjoy it as much as we did.
On today’s podcast:
- Technology and marketing
- The beauty of a plural life
- The importance of customer loyalty
- Reimagining high fashion and technology
- Customer lifetime value
- Our content consumption preferences
Links:
- JoyTech.org – Interviewing Noreena Hertz
- Twitter – @RodBanner
- LinkedIn – Rod Banner
- Website – 3LA.com
Digitally Transforming the High End Fashion Industry
“My name is Rod Banner. My background is long. But I started off in marketing, I worked in advertising when advertising was a profession. And it had a lot more respect and reverence than it probably does now.”
From launching Bailey’s Irish Cream, launching VHS video standard, to launching Casio watches, Rod has been involved in big brands from the beginning. But at some point, he decided to start his own agency, Banner, that focused solely on tech.
All of his clients were tech clients – West Coast American companies. And then they landed a big piece of business with Cisco Systems (a client they won by responding to a fax brief), which was the catalyst for enormous growth for the company.
“I mean, literally, it was a nothing company, we launched it into Europe. And at one point, just at the end of the.com boom, it was the biggest business by market cap in the world, it just beat out Exxon.”
Technology and marketing
“Here’s why I’m still drawn to technology and marketing, because, as you know, almost every decision somebody makes is driven by emotional response. We come festooned with prejudices, and predilections and we respond emotionally. And then we post-rationalise the decisions that we take.”
Even the most tech of technology businesses have to be able to capture the emotion in the minds of potential purchasers, and that’s why Rod loves technology and marketing so much.
At one point, he thought he might own a portfolio where these two things crossover – technology that powers marketing, but quickly realised that that area had been snapped up by the big tech empires – Facebook and Google, and the little companies, the ones that need investment, were being squished.
Plural life
Having sold his agency, Rod started to court offers from people who wanted a bit of his success. And this is where he wishes he could have done things differently – rather than waiting for offers to come to him, he would like to go and actively seek out the companies and people who he’d like to work for.
But when things started settling down, he saw opportunities where he could get involved. And one area where he’s been working hard in recent years is customer loyalty.
Customer loyalty
“I love the idea of customer loyalty, I love the idea of technology that powers customer loyalty and how to make customer loyalty systems really work. Because for the most part, they really don’t.”
For much of lockdown, Rod has been fascinated with high end fashion, more specifically the fashion brands that aren’t run commercially well. Fashion houses showcase products at shows. They make very short orders and charge very high prices. When they don’t sell, they then get heavily discounted, which is brand suicide for high end brands.
“If you’re trying to create a luxury brand at a high price point and then you’re prepared to undercut yourself within weeks, customers just go: ‘I’m never gonna buy at full price, I’m gonna wait for the sale’, which is what they all do.”
Which then creates a dissonance between loyalty and a crackers pricing model, which essentially drives loyal customers away from being loyal to their favourite high end brand.
Tokens instead of sales
So to combat this weird business model, Rod has come up with the idea of tokens, like a reward point, but with dynamic value, instead of sales.
“If you’re a loyal customer, you can gain access to products at the beginning of their life at an option price. And the option price is something that’s not guaranteed. But it gives you the option to get such a product later on in its life, assuming that there is stuff in your geo and your size that you’ve indicated you might want, but weren’t prepared to pay full price for.”
This dynamic, constantly shifting pricing, brings about an element of gamification for customers, creating instant engagement.
This works twofold – firstly, it creates engagement between the brand and their loyal customers, but secondly, it allows the fashion house to understand who their potential purchasers are, providing data about what people want ahead of manufacturing, so that the manufacturer can make them to demand, meaning less waste.
“We could obviously then determine from taste what colours, shapes, forms people might choose so that we could promote those to them and tantalise them with incentive pricing.”
And the thing is, says Rod, this just wasn’t possible until fairly recently, technology allows brands to own the customer, not the other way around.
“Any fashion brand that’s not going DTC, they’re dead. There are lots of those intermediaries, retailing brands that are doing really well right now. But I sense it’s just an evolution.”
Customer lifetime value
If you’re a dedicated follower of a brand, then you’ll likely want to build a relationship with the originators of the products you love.
And that’s the piece that interests Rod.
“Customer lifetime value should be lifetime. And if you lose faith in a brand, it’s largely because they’ve messed up. I would argue. They’ve told a big fat lie, or they’ve misrepresented a product or something. But if you continue to strive to do your best as a brand and serve a need that a customer has, [you should] be able to keep them forever. That’s what marketing should be.”
The changing nature of advertising
Despite having cut his teeth in business in advertising, Rod maintains that the sort of advertising he used to do, the kind that interrupts you, should be history.
“I do not believe that the relationship that a brand has with its customers can be in any way improved by irritating them, interrupting them, or pressing them to do something that they had no interest in doing.”
With the technology that we have available, businesses should look to adapt their content marketing – people should be able to choose how they consume content, when they consume it and through what medium.
“You should be able to discover content that informs you or satisfies your curiosity in a way that really is helpful and supportive, rather than just content jumping out of something that you’re already engaged with and just hitting you over the head with a message that you don’t want.”
Book recommendations
- Jonathan Haidt – The Happiness Hypothesis
- Jonathan Haidt – The Coddling Of The American Mind
- Scott Galloway – Post Corona
- Mariana Mazzucato – Mission Economy
- Noreena Hertz – The Lonely Century
- Martin Fincham – Diary Of A Novice Ned
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