Augurs on the Town Ep. 10 with Doug Spong

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Josh Becerra: Hi, everybody. This is Josh Becerra from Augurian. I have the pleasure of interviewing Doug Spong for this episode of Augurs On The Town. Doug is a founder and CEO of Doug Spong Company, which is an advisory firm to agencies. Doug has been in the advertising world for over 35 years. The last 25 years, he was a co-founder, president, manager of Carmichael Lynch, which works with iconic brands like Harley Davidson, Jack Link’s, and Subaru. I’m super excited that we’re having this opportunity to chat, Doug.

Doug Spong: Good to be here. Thanks, Josh.

Josh: Well, I’m really curious, you and I, we’ve had a couple of conversations. I think some of the best parts of our conversations is when you talk a little bit about being the president and manager of Carmichael Lynch and what you learned working with brands. Why don’t you tell us a little bit about when you got into that role and the changes you had to make an agency to see the growth that you saw when you were there?

Doug: I was there, as you said for 25 years. I saw a lot of change over those years. The biggest change certainly would have been going from very traditional television, print, outdoor environment to really an environment that emphasized digital. The spending, I could show you the revenue numbers, but the spending shifted that from one point where we were creating 55 to 60 print campaigns, not print ads, but campaigns with multiple print executions within each in the course of a year, over time, that shifted to where we might have five or seven print campaigns.

It had all gone either into television or digital, or frankly, some amalgamation of the two, where you’re producing content that you might have thought of it as originally for broadcast for television, but you might have a little longer-form content for online consumption, whether it’s social or web or some of the proprietary channels that you might use. That was certainly the biggest change was seeing that shift in business.

As an agency, we had to adapt to that. The people that we hired, the talent and skills that we were looking for became very different. We weren’t looking for just great copywriters and print art directors anymore. A lot of resources went into funding integrated production, things that- content across many different platforms that could be repurposed and reedited and reused to really create one seamless campaign for a brand.

Josh: I know that a lot of companies sought out Carmichael Lynch when they were thinking about- or their brand was getting stale or they needed something new. Can you talk a little bit about how you were approaching those projects? Because I think that was interesting in our previous conversation

Doug: Absolutely. There’s typically two brands or clients that you represent. There are those that might have been struggling with low brand awareness, not really have a following, relatively low revenue in terms of sales, that’s looking to grow. They’re a distant second, third, fifth in the category. They’re looking to grab the category leader by the ankles and pull him off that king of the hill position. Those are fun brands. We can call them challenger brands in the industry. Then you’ve got other brands– We worked with Harley Davidson, mature brands that have been around on this case for 125 years with Harley. They have been category leaders in their space.

They had a lot of upcoming challengers. [inaudible 00:04:29] The story of that is when they first came to us, we had never heard of what Jack Link’s as a brand was, which of course, nowadays seems hard to believe because it is fairly ubiquitous in the snack category. Here it was, we love to talk about– Brand marketers love to talk about David versus Goliath. The reality is there are very few true David and Goliath stories. It’s usually David taking on a David, small brands fighting it out, or you’ve got a Goliath taking on another Goliath. In this case, it really was a true David and Goliath story. Here you had Jack Link’s, which was individually and personally owned by Jack Link himself. Yes, there really is a Jack Link and his son Troy, who’s the CEO. The Goliath in that category was Conagra foods, this giant global company that owns the Slim Jim brand. Of course, Slim Jim–

Josh: And 100 other brands, right?

Doug: 100 other brands. Absolutely. Slim Jim had this dominant number one category position in the meat snack business. Jack Link’s when they first came to us had no to low brand awareness. I even went to our typical hook-and-bullet crowd upstairs in the creative department to say, “Have you guys ever heard of Jack Link’s?” These are guys who love to fish and hunt and were the typical turkey consumption. They go, “Jack Link’s? Jack Link’s? No.”

It turns out the packaging design time at that time was so bad that when you tore open a package, you literally ripped the brand name right off of it. All you were stuck with was the packaging that said “jerky” on it, which was also part of the problem. The first thing that we did was we said, “Hey, this is a fun brand to compete with.” We agreed to take it on, and so we wanted to compete for this piece of business. Slim Jim found kind of a complacent category leader that really hadn’t innovated much. The product quality was just so-so.

Josh: Yes. I would agree with that.

Doug: We love this kind of Jack Link’s never say die type of attitude that they had. Our approach has always been “Speak to the core, and others will listen in.” In everything that we do, whether it’s for Jack Link’s, Suburu, Harley, other brands, it’s this idea that you have to really identify, understand, and have empathy for and relate to who that core is. In the case of Jack Link’s, what we discovered through our insights work is that we ended up branding them as adventurous spirits. That was kind of the term that we called– I love to call them “mindless munching males”. They’re kind of a young 26-year-old guy, he was male, but there are women who have a very shared mindset with these guys, so it isn’t just all male. These adventurous spirits, they’re not your typical grocery retail consumer.

Josh: More of a [unintelligible 00:07:41].

Doug: They don’t sit and come up with a grocery list or put it on their phone and going and spending $200 shopping at Cub Foods or something. When these young guys, mindless munching males, when they shop, they basically go to the convenience store. They pull up, they’re at the C-store, walk in, grab their can of diet Mountain Dew and grab something off the endcap to satisfy that hunger pang that they have at the time.

Josh: Yes. I’ve seen them in the wild.

Doug: Absolutely. The other thing is adventurous spirits are not typical media consumers. Of all of the segments that you go after, a young male is probably the hardest to reach from a media consumption stand of mind. They don’t wake up and watch the Today Show, or they don’t subscribe to a daily newspaper. This is a consumer who- if they do watch television, it’s Comedy Central, it’s MTV. It’s late-night television. If they’re online, they’re not necessarily huge social networkers. What they’re online doing is they love to game. They’re online gaming late at night with people that are complete strangers to them, but they feel like they know because they’re gaming Dungeons and Dragons or something else online.

It’s a very atypical media consumer. The other thing is when you look at the product of Jack Link’s, it’s very much an impulse purchase. It’s not a considered purchase. It’s an impulse. This idea of being top of mind in a fun, playful way with these guys, and being located at that endcap at C-store was crucial to us. What we ended up with was a brand position that was all around “feed your wild side”.

If you go to jacklinks.com, or you see the television today, it still has that same brand position that we developed from the very start of this brand. It’s just this idea of a fun playfulness. As you look at the execution of Jack Link’s, there’s always a huge dose of humor with it. The reason for that is, as a lot of marketers either know or have discovered over the years is, humor is the number one emotional connector that you can have between brands and their bulls-eye target. Most brands uses a lot of humor. We ended up executing that brand position of “feed your wild side” with a campaign called Messin’ With Sasquatch. Messin’ With Sasquatch became- the honest thing is people like to say, “Oh my gosh, your consumer insights led you to this idea of using Sasquatch.” What I honestly say is no, that’s- I love in a perfect world to say that’s how it works, but it’s really this intersection, frankly, of how we had a creative director of Scott Davis who probably for three or four different client campaigns had been trying to find a way to use Sasquatch. He was just enamored with Sasquatch.

Josh: Mission Sasquatch.

Doug: Absolutely. When you think about Sasquatch, he’s ubiquitous because we might call him Sasquatch in the Midwest. If you go to the Pacific Northwest, he’s a bigfoot. In Asia, he’s a Yeti. Everybody knows what Sasquatch is and has this affinity for Sasquatch. He’s a scary character, but at the same time, we’re also intrigued by- is he real, is he not? What would it be like if I actually ran across him in the wild?

What we did was, we executed this Messin’ With Sasquatch campaign, frankly, through so many different media. That became the- Messin’ With Sasquatch was that central spine of an idea. We built everything off of that. The way it was executed is you saw the 32nd television where people were still used to that voiceover opening the spot that said, “Jack Link’s Beef Jerky presents Messin’ With Sasquatch.”

It had the same little thought to each of the 32 spots. It would be our adventurous spirits who index very high for outdoors. They love the canoe, kayak, bike hike. We find them out in the outdoors, socializing with others of a similar age and demo, and they would stumble across this mythical character Sasquatch. One of them would take a bite of jerky, come up with this wild hair dyed idea of, “How do I mess with them?” They would actually execute that. They would mess with them, and then at the end of the spot, of every spot, Sasquatch always got his revenge in some way. That was the typical plot for a Messin’ With Sasquatch spot.

We also had, if you went online, it was a “too hot for TV” version on YouTube. We would run these spots that we knew the censors at NBC weren’t going to accept. If you go on- and they have that, again, that mindless munching male sense of humor, sometimes a little bit on the growth side a little bit, maybe some [unintelligible 00:13:05], it was a lot of fun. We also developed consumer-generated content where you know you’re doing your job as a brand marketer, the consumers take your brand and start making their own Messin’ With Sasquatch commercials. They would dress up their girlfriends in this gorilla suit. They’d take them out to the wild. They’d have a little storyline developed and they would film these 32nd spots and they’d do this voiceover of “Jack Link’s Beef Jerky presents Messin’ With Sasquatch”.

We ended up with, literally, there were about a thousand consumer-generated spots that went on the YouTube channel generating in excess of 25 million views on YouTube, just from people generating this themselves. We also did a lot knowing that our consumer was a heavy online gaming consumer. We had a Messin’ With Sasquatch game where you could actually go online and you could mess with Sasquatch himself. You could swing a piece of log and hit a critter, things like that, that you would expect Sasquatch to do. Then we developed even a living Sasquatch app where people could take their laptop or cell phone camera. Through this app, you could actually download a little GIF of Sasquatch and you could animate it and then you could record it. Then you could post it to your social channels.

You could share it on your social channels and it was all a way to help you generate that. Then, of course, you get into sports partnerships, you get into experiential and even media. We had brands like the entertainment brand Rascal Flatts. The artists would be in People magazine saying one thing they go on the road with that they couldn’t do without is their Jack Link’s Beef Jerky.

Josh: That’s awesome.

Doug: The whole thing snowballed that way. The end result was, to make a long story short, the end result was here you had a brand that was a distant third in the category that leapfrogged number two and leapfrogged number one to become, not only the number one meat snack and jerky brand in the category supplanting Slim Jim, but frankly, they supplanted every brand, every food brand in the convenience store, a C-store. They became the number one by volume, by revenue volume, seller in all of C-store.

Doug: Well, they’re from Minong, Wisconsin. Yes, that’s where the Link boys are from. If you drive through that part of Wisconsin, you go by the Link motors, so they’ve got one of the oldest Ford dealerships in the country. They own the grocery store, the avenue dealership, but actually have technically moved their Jack Link’s headquarters to downtown Minneapolis in what’s now the Mayo Clinic building-

Josh: Got it. Cool.

Doug: -where the Timberwolves practice.

Josh: I think it’s amazing how from just thinking about that mindless munching male, as you’ve characterized the persona, to be able to develop all of those things around the brand and really align where does that persona live online? In the real world, how can we be top of mind, because that’s all you need to be when they look at that endcap and [unintelligible 00:16:38] whatever they need to satisfy their hunger. I love that story. I think it’s amazing. It’s a brand like no other in many ways.

What do you think about brands today? Have you seen any brands that you think have come on the scene that are doing a great job, either given the context that we’re living right now or just in general, do you have any brands that you think are lining up all the stars the way you did with Jack Link’s?

Doug: Yes, I do. I see a lot of brands that are really fairly quickly adapt to the reality that we’re all living with right now. I think part of it is there’s a consumer activism that’s going on, where one of the things that’s changed, the most, I would say, in the last 10 years, has been consumer’s expectations of their favorite brands, which is that they not only provide this great relationship with the consumer themselves but the brands also, in a sense, fill the void that government and a lot of our elected officials haven’t been able to fill to this point.

When you look at this recently, with Black Lives Matter, racial equity, you look at the Me Too movement, you look at climate change, there are a lot of things that brands are being asked to fill in those gaps that our elected officials just aren’t addressing right now. One of the things that I think a great brand here locally in the Twin Cities that is making all the right moves is Target. You look at the fact that they didn’t have to be– Brian Cornell, the CEO, and their team made the choice to say, “You know what, we are going to pay a livable wage to all of our part-time and full-time workers at the stores or associates.”

What they did was they elevated to $15 an hour and they set a date and said, “By this date, we’re going to pay every worker $15 an hour.” That’s to address that wage inequity that you hear about the– It’s not even middle class. Most of us understand 15 an hour isn’t even achieving middle class, but it’s enough of a livable wage for people, that it helps fulfill and helps fill in that pothole that’s been sitting there. You also look at how Target when it comes to restrooms, and they’ve come up with gender-neutral identification on restrooms. Really reaching out to the LGBTQ community and saying, “No matter how you identify in terms of your gender, Target makes a very friendly environment in store for that.” Those are huge. Target, of course, as you would expect, has taken some criticism from the conservative side of that argument, but they’re not afraid to plant their flag on issues like wages and issues on gender identification because it’s the right thing to do not just as a business but also for their guests. Target, I think really like Jack Link’s and other great brand marketers really understand intimately who their guests, who their consumer is. As I said, they know to speak to that core and that others will listen in on that piece of it.

Josh: The fact that they’re doing it without it needing to be legislated, that’s [unintelligible 00:20:34] decision on their part. Actually, they’re leading, then it gets their competition to look at them and say, “Man, we have to have a point of view on this.” It is. It’s super valuable to have brands and large businesses where a tremendous amount of the population interacts with that business, planting those flags.

Doug: Right. We’ve seen a lot of big surprises in brand marketing too. When you think about a brand like Walmart that historically being a Southern-based company, having grown up serving a much more conservative rural versus urban base of consumers, here, you got Walmart that has removed all AR-15 gun sales. They’ve removed ammunition. They are no longer selling guns and ammo. You got Walmart that has come out against the Confederate flag. Again, a current issue that they will sell any merchandise that has the Confederate flag in it.

Even recently just this week, Walmart said, “We are not going to sell anything related to the Washington Redskins fan apparel.” That image of the chief and the name Redskins, until that changes, Washington will not have apparel represented at Walmart among other retailers. That’s a very big shift, I think, for a retailer that most of us particularly here in the bold North tend to think of as Southern rural culture. They cater to a gun-loving crowd and it’s very different for them. You got to applaud brands like Walmart that are willing to do that and plant a flag in the ground.

Josh: I think it’s amazing. It’s amazing times we’re living in and changes happening really quickly. I think brands, even big brands which traditionally probably aren’t perceived as nimble, are actually being pretty nimble and facing some tough choices and making them probably quicker than they want to, but that’s the world in which we live. Let’s talk a little bit about the- especially, I know because you were a leader of an agency for so long and because of your consulting work with agencies, where do you see the future of agencies going given this context and just what you think about the future of agencies? I’m just curious.

Doug: Well, I can tell you one thing that from the day- I started in this business back in 1981, I’ve heard about the death of agencies from so many pundits out there that it’s laughable. First of all, you’re never going to hear me say that I think our business is at risk. It’s not. You and I make a living in the creative economy. Creative economy is a very different professional service environment from accounting, legal management, consulting, and others. It’s interesting to watch the big four accounting firms. You look at Deloitte, Ernst-

Josh: KPMG.

Doug: How they’ve gotten into trying to leverage their strategy side with acquiring creative agencies. You’ve seen [unintelligible 00:24:30] brands if I want to put one of the big four. I’ll be interested to see how that works, but I think what that tells you is if you see the big four management consulting companies trying to get into our business, it tells you that there is a huge value proposition that they can’t easily build themselves. The same goes for clients who want to build it in-house. Most clients simply cannot attract the level of creative talent and frankly the broad holistic thinking to be able to take this thousand-piece puzzle of what we do every day in terms of brand marketing and try to put a thousand pieces of that puzzle together to have it make sense for a brand and have really each piece of the puzzle work together to create a complete picture for a consumer.

That’s the unique skill-set that I think the best agencies and the agencies going forward that are going to thrive are really great at putting those pieces together. Part of that, in our business is, it’s a little kind of half-art half-science. We’ve got the true art side of what we do, from the art direction, design and illustration, and animation, then you’ve got the production side of the business. Then you’ve got the research and the insights and the data analytics and the measurement and optimizing real-time science part of the business that we do.

The best agencies, not only staff both, but more importantly, they, each side I think has developed an inherent appreciation for the other side. In other words, not only does the analytics and the science side of the business support the art side of the business, but great agencies also understand that the art side, the creative side of the business has a real impact on and partner with the analytics side. That’s a change. It always used to be one-way, analytics drives [unintelligible 00:26:43] operative, but now it goes as much the other way too. A lot of the future is going to be around that.

The other thing is because we all are either working from home or were limited to how much time and how much density we’re packing in the office space right now, I think the best agencies are focused on their staff, very much focused on not just– It goes beyond work-life balance. Right now it’s kind of personal well-being that I think CEOs are very careful and invest a lot of time in worrying about their people’s well-being, their mental health or physical health, their career satisfaction that they’re having with what they’re doing right now.

What I find is that, as an agency, having a crystal clear understanding of who you are as a brand, and what value do you bring to the world, not just to your clients, but to the broader world, because when you think about it, we exist for our staff. They’re number one, take care of staff, number one. We exist for clients because if you don’t take care of staff, they’re not going to take care of clients.

The third thing is the work, the magic that those two things create, the staff put together with our clients, creates this– Steve Jobs used to call it, putting a dent in the world or putting a dent in the universe. That’s why he went to work at Apple. A lot of that is very true in our business where people who love and have the highest level of satisfaction in our industry really feel like they’re making a dent in the world in some way, they’re putting their mark on it. They’re making it a little bit better place to be. That’s a big focus I think for agencies is to take care of that staff first.

The other thing I can tell you is absolutely positively there is a correlation between employee satisfaction in agencies and financial performance. The two go hand-in-hand. If you want to reverse engineer, how do the best agencies that are generating the highest levels of operating income and net income at the end of the year, what are they doing that’s different from all the other agencies that are struggling to make an operating profit, struggling to grow revenue?

It goes back to their staff satisfaction. That’s a huge part of it. It impacts productivity. It impacts absenteeism. It impacts attrition and turnover. It impacts the ability to hire the very best people. It impacts the quality of the work that come out of those people. The higher the employee and staff satisfaction, the better the financial performance of those agencies. It just goes hand-in-hand.

Josh: I totally agree with you. We focus a lot at agreeing on our values as a company and our brand, but more importantly, on our people. We think that is the big difference. We talk about it a lot. We invest a lot in them. We try to create that environment where they can come to work and be their true selves every single day and have that mental health and the time away from work, also, to recharge the batteries.

Doug: I want to show you one thing, too, just as kind of punctuation. I have sitting on my desk here- it’s a little urn. If you can’t read it, it says, “Ashes [unintelligible 00:30:46] clients.”

Josh: Hold it up a little higher.

Doug: This was given to me by my long-time partner, Lee Lynch, years ago. I’ve only got two clients that I’ve burned the contract in here of. It emphasizes the fact that if you’ve got a client that distracts or dilutes your culture and your character as an agency, my first thing I always ask clients is, “How would you be better off without that client?” Don’t be afraid to terminate a bad client. We’ve always said we don’t work with assholes. That was always rule number one, don’t work with assholes. People would be amazed at the number of clients that we parted with over the years that just were a drag on the morale of the staff.

They couldn’t afford great work, they didn’t appreciate great work, and they were contrary to everything that we were about as an agency. I think it’s very important for agencies to select the clients that identically match and next-to-perfectly fit who they are as an agency. I can’t stress that enough too.

Josh: Yes, that’s great advice. I find myself- whenever we have a conversation, I just sit and listen, and I go, “Yes, yes.” That’s basically been our entire interview today, Doug. I so appreciate all our conversation, always. You are a fountain of wisdom. I really appreciate you taking the time today to do this.

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Doug: Thanks, Josh. It’s always good to chat with you. Thank you.

Josh: I hope that people listening also take advantage of your wisdom.

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