Flip the Switch Episode 12: Bernie Schroeder
We have the opportunity to interview branding and marketing expert, Bernie Schroeder. Bernie is notorious for helping Amazon get their start, working with Apple and Pixar, and was a partner in one of the largest integrated branding agencies in the world.
Flip the Switch Episode 12: Bernie Schroeder
SOPHIA: Today on Flip the Switch. We have the opportunity to interview branding and marketing expert, Bernie Schroeder. Bernie is notorious for helping Amazon get their start, working with Apple and Pixar, and was a partner in one of the largest integrated branding agencies in the world. He is currently a mentor in the CSU entrepreneurship program. And the author of a new book for Millennial marketers titled “Brands and Bullshit.”
Let’s get into it.
00:57 AUSTIN: Welcome to Flip the Switch podcast presented by Power Digital Marketing. We’ve got a very exciting episode for you today. We’ve got a marketing legend coming in.
01:04 PAT: That’s right. Today we’re going to be interviewing Bernie Schroeder. He is a business consultant, marketer, branding expert, author. He’s regularly quoted in extremely reputable publications like The New York Times, The Wall Street Journal, Entrepreneur…
01:21 AUSTIN: Hey Patrick… you ever heard of a company called Amazon?
01:22 PAT: Don’t we talk about that kind of frequently on the show?
01:24 AUSTIN: Yeah. He may have had a pretty big influence in starting it.
01:27 PAT: That’s very interesting. And for real, we have been looking forward to this interview for weeks. We really think this is going to be one of the most insightful interviews when it comes to marketing and branding. And we were so excited to bring that value to you guys. So, without further ado, here’s our interview with Bernie Schroeder.
01:48 AUSTIN: All right, with us today is Bernie Schroeder. He is a marketing and branding expert who once ran the largest integrated marketing agency in the world called CKS partners. Bernie had the opportunity to help Amazon and Jeff Bezos get their brand off the ground, and his agency worked with Steve Jobs. These days he spends his time helping young business people better understand digital marketing, and recently wrote a book called “Brands and Bullshit: Excel at the Former, and Avoid the Later.”
Bernie, thanks for joining us today. It’s an honor to have you. It’s an honor to have a marketing legend on the show.
02:18 BERNIE: I don’t know if I’m a legend, but thank you very much for having me.
02:21 PAT: Jumping right into things, give our listeners a little bit of a context here. How did you find yourself getting your start in marketing and when did you really feel that you knew that you’d found your profession.
02:33 BERNIE: When I came out of college, I had 2 choices of working somewhere and I evaluated them on what I felt would be more valuable. One was actually a hospital and the other was a marketing agency that I knew nothing about. And when I evaluated them, I thought, “Wow. I don’t know anything about marketing and computers.” It was a database marketing agency. “And I know that the hospital will always be there. So if I’ve chosen wrong, and I choose the marketing agency, then at least I’ll know more about marketing and computers at the end of the first year. And I can always go to work somewhere else.”
So that little decision had me choose the marketing agency, because honestly, I knew nothing about marketing.
03:14 PAT: That’s interesting. So it was almost more of a practicality play. Like, setting yourself up for future skill sets.
03:18 BERNIE: I wouldn’t say as practical as it was–without even thinking about it–being strategic. I wanted to add something to me that would add value. And I thought if I know a little bit about marketing, I know a little bit about computers–I just believe that’s going to make me more valuable. And that was basically what I used for the decision. Because the marketing agency paid me 3 times less than the hospital was going to pay me.
03:43 AUSTIN: Yeah, that’s really interesting. So basically you’re saying that you took a chance on this one and then that’s led to success long-term.
When did you start seeing that success pay-off? Or when did you realize that, “Hey, I might be sticking with this. And I’m in this for the long-term play.”
03:58 BERNIE: I would say in the first 2 months of what I was doing for this agency, I started to get insights into how they were using computers to do marketing. And they placed me on the Cadillac account. I was in Detroit at the time. And I was fascinated that you could take data and marketing information about humans, and then you could fashion a product or service around that data or knowledge, and make people buy something. I thought that was cool shit.
04:28 PAT: That’s pretty interesting too and then you went on to start one of the largest marketing agencies in the world. CKS Partners. Can you tell us a little bit about how that came to be and kind of the story of how that foundation?
04:37 BERNIE: So, when you get good at something… so I always wanted to get good. Once I thought that I was good at marketing, then I was like, “I want to get really good at marketing. Because it seems like the players in the room in the marketing arena are really good. So how do I get good?”
So I spent 5 years getting good. Then I decided to go to New York and test myself. I knew I was good in Detroit. But I didn’t know if I could be good at a bigger arena. So I went to New York and I did really well.
Then I thought, “Wow. If I’m going to do this for the rest of my life, why am I doing it for people I don’t exactly respect? I’m as smart or smarter than the people that own the agency. So I need to create an agency.”
I tried to find those people in New York. I couldn’t. And so I decided to accept a consulting gig with Apple simply to get me to Silicon Valley. I actually did not like Apple at the time.
05:31 AUSTIN: Really? And when was this? This was 1990s?
05:35 BERNIE: This was 1990, actually.
05:37 JOHN: What made you not like Apple, at that time?
05:38 BERNIE: Well, at the time, Apple… Steve Jobs was not there. Apple was struggling. Based on what I could see, they were within a year of bankruptcy. They had 1% market-share. IBM was kicking their ass. And HP.
And they were rudderless. They had no leadership. So I went there simply to get to the Valley. And that was my goal. And I got there and within 6 months, someone at Apple introduced me to my future partners.
06:08 AUSTIN: Wow. That’s incredible now. Obviously, looking at what Apple is. And what was specifically that they brought you on for consulting? Was it a brand situation or…?
06:15 BERNIE: It was a marketing situation. I reported directly to the senior VP of marketing, who I met on a plane. And he was describing to me everything they were doing in marketing–which I thought was really bad. And I said, “You need to amp up your game.”
And he knew my background after the plane flight. With my consumer and automotive and camera experience, and he said, “You need to bring some of that branding and marketing discipline to Apple. Cause we’re out of control. We’re just doing whatever we feel.”
06:45 AUSTIN: In what capacity was your future partner working at that time?
06:48 BERNIE: I actually met my 3 future partners. The guy I was getting ready to put a very large education campaign together for Apple. They were still good in the Ed market. For some reason, IBM was not focused on elementary and high school education at that time period. They were focused on more corporate.
So there was this small group inside Apple that felt the future of Apple was based on penetrating the education market. So as these kids grew up, they’d fall in love with Apple, right?
So I was putting together a fairly large campaign and he recommended we use a bunch of agencies to do the work. And then this one little design shop. And I did not want to use that design shop. I didn’t know anything about them, but they were just small. And I didn’t want a small player on a big campaign.
So I asked this VP to set up a meeting. And my sole goal… when I went to the meeting… was to eliminate the shop. I wanted to find out something about them that I could use against them, and then eliminate them.
Instead, after a 1 hour meeting with these 3 people… I walked outside, leaned against stucco wall and said, “Holy shit. These guys are all smarter than me.” And I knew then in my heart that they were my future partners.
And it took me about a year of dating with them, and playing with them for them to see that I was the 4th guy.
08:14 PAT: And then fast forward a couple more years… talking about the prime-time of your marketing agency. What was your guys’ core philosophy as a company? That you feel that made you such a force to be reckoned with?
08:24 BERNIE: So the reason that I went to Silicon Valley from New York is that I started to see traditional advertising fray a little bit. I saw more direct, I saw more database. I saw more outdoor. I just started… I saw more demos. And I was like, “Wow. You just can’t make it in the future on print and TV.”
At least, that’s what I started to believe. But no one believed that. Everyone still believed that traditional advertising was going to rule. So I believed that the people that would not believe traditional would last would be in Silicon Valley. Because I believed that the approach to marketing in the future was branding first, integrated marketing second, and don’t do the media. Because the media… the way you were compensated back then, you were compensated based on the media you place. 15%. That meant that every solution you had, had to be advertising print or TV. Cause that’s how you got paid.
09:20 AUSTIN: And can you explain to us integrated marketing and that core competency of your agency. Because that seemed to be the thing that really sets you apart from your competition.
09:28 BERNIE: Well, at the time that we got together and said that we were going to do integrated, the entire Valley laughed at us. We were seen as the retards of the marketing industry in Silicon Valley. We said we were going to do branding first, and then we were going to do integrated.
And integrated as a philosophy is hard because it means you have to be capable of doing everything the client wants. So you have to be good at direct. You have to be good at packaging. You have to be good at Trade Show. You have to be good at outdoor. You have to be good at TV. You have to be good at print. And eventually, when the Internet came along, you had to be good at Internet.
But we believed that if 1 shop did all the work rather than multiple shops which was how it was done… and still done that way today. That that 1 shop could own the brand, and they could simply bring in the disciplined people to do it.
And everyone at that time did not believe that was possible. That you could bring in multi-disciplined people and do integrated work.
10:24 PAT: And then, you know, fast-forwarding to today… Do you feel that the prevalence of integrated marketing as a field of study even… at a place like SDSU, you see integrated marketing/communications as a field of study. Do you feel that’s something that can be taught in a classroom? Or it sounds more that you guys kind of found that niche through observation and seeing other best practices from existing shops.
10:45 BERNIE: I think if you’re a brand today, you either believe in big branding and certain messaging. Or you believe in integrated and you don’t. I still see brands using multiple agencies. They’ll use an outdoor agency. They’ll use a TV. They’ll use… if they’re still doing TV. They’ll use a packaging if they’re doing packaging. They’ll use a digital shop to do their online.
Unless that leadership has the strength and experience to coordinate multiple agencies to do the work, I believe what we’re actually seeing is a little bit of fragmenting again, where now the pendulum has swung so far back to digital, that everyone’s like, “If you’re not doing digital, you’re a dumbass.” And “digital will rule the future.”
And I’m like, “It might. It might. But what I’m not seeing is the integrated effort and the discipline and so I’m seeing a disparity of messages where a brand might say something somewhere. And then in social media they say something else. And then in an AdWords campaign they say something else. And then they do an event somewhere, and it’s not within their core character of their brand.
That, to me, comes down to not what’s trending but leadership. If they don’t…
11:57 AUSTIN: (laughing) We are a digital marketing agency, so just be careful on bashing us there a little bit.
No, but you make a really great point there and, you know, the niche in itself of integrated marketing… it may seem like such a broad playing field… “Why would you go with an agency that does everything? Because they’re probably not good at that little thing.”
That seems like that was your brand and that was the cultivation of your brand is being that integrated piece.
12:17 BERNIE: Not only the integrated piece, but you had to believe it. Understand…you’re saying in 1990-91. We believe traditional advertising’s going to die. At the time, the spend for traditional advertising was exploding. So we were Chicken Little saying the sky is falling. So that’s why everybody laughed at us.
If you have a fervent belief in the power of what you believe is a different marketing discipline, you just can’t move off of that belief.
The other thing that that belief does for you… it has you saying this. Does a chief marketing officer out there want brand synergy? Of course they do. Do they want monthly discipline from one agency? Yeah, but it doesn’t exist. Do they want people that are not going to be slaves to media, but are going to suggest the right media and the right thing to do? Of course they do.
At the time our biggest challenge was just finding other people who believed what we believed. That we could bring multi-disciplined people together under the mission of the brand.
13:25 PAT: And then talking about the mission of the brand a little bit… Let’s talk about Amazon. I know that you were there to witness them sort of at the very beginning. And helped them build some of their brand identity. Can you kind of talk to us a little bit about how you observed that company going from an online bookstore to a leading tech giant? And kind of how you guys helped them build that initial identity?
13:43 BERNIE: So I was in Portland at the time. I think it was ’94. And it was either ’94 or early ’95. I took a phone call, just a phone call in my office and it was Jeff Bezos. And he said, “We’re looking for an agency. We just got some funding from Kleiner Perkins and we know that you have an office now in Portland. And would you be interested in working with us?”
And I literally said to him, “What is Amazon? What do you do?”
14:15 PAT: (laughing) Such a foreign concept to us now.
14:18 AUSTIN: (laughing) We talk about Amazon a lot on this show…
14:19 PAT: (laughing) Almost every show…
14:20 BERNIE: (laughing) I know.
And so he said, “Well, we’re starting out selling books.”
And I was like… I was thinking this was like dumber than anything I’ve ever heard before, right? And so… it was a 3 minute phone call. And I’m trying to qualify this guy on the phone. So he’s in Seattle. Okay.
2. He just got money from Kleiner Perkins. That doesn’t suck.
3. He’s selling books online. That seems stupid. He seems somewhat intelligent on the phone. Okay. I should take a meeting.
That’s how quickly I qualified it. I’ll tell you right, I was not excited at all. I had other things going on at the time. I literally hung up the phone, I walked next door to my creative director’s office and I said, “I just took a phone call from a guy in Seattle. But I don’t think we should even go to the meeting.”
And he was like, “Who is it?”
And I go, “Some guy who’s got a company… get this… shitty name “Amazon.”
And he goes… and he was younger than me at the time. Not that I was that old. I was probably 32, 33. And he was, like, 24. I had recruited him out of Asia.
And he goes, “Amazon! Oh my God! The bookseller?”
And I was like, “How the hell do you know?” And my creative director was a tech-head, amazingly. Who’d been on the Internet and was kind of moving around.
I ignored the Internet for the first 2 years. It meant nothing to me. It was like pretty brochure ware. I couldn’t figure it out.
So then we went up. We won the account. And because then I understood… Jeff gave us a bigger picture vision. And what he actually wanted was not a prettier website. Yeah, we had to build one and it had to be functional and it had to have good UI.
What he really wanted was to build a brand. And that excited me, because I felt like I was at a point in my career where I was going to be a builder of brands. And so they needed a brand. I saw them no differently at that point, than I would see a car company or a cereal company.
16:09 AUSTIN: And what were the specifics that had you come up with the philosophy that you would apply for them? Or what was the big win that you provided for Amazon?
16:15 BERNIE: I think Jeff sensed very quickly that we came in and met with him, we didn’t do a traditional presentation. We presented no creative. We presented nothing.
We presented a list of questions that kind of laid out for him what we thought the weaknesses of the company were. No awareness. Selling books online when you could buy them across the street. This thing called the Internet? Low awareness.
We were like, “If you don’t do this carefully… if you don’t target the right early adopters, the right early influencers–which, by the way, you’re going to reach through print media. Not online. You’re not going to be able to create enough energy to get more money.
Cause he told us his whole strategy was come out hard with the money he was going to give us. Use that to explode sales, because he needed to go get more money… He knew the money he was giving us was only going to last about 6 to 9 months. So it was all-in.
That’s another thing I loved about Jeff… He gave us 90% of the money that he got from the VC to do the marketing. And said go.
And we said, if this doesn’t work, and he does not increase sales, he’s not getting the next. And he was so confident in that. He was like, “go.”
And that is awesome. When you have someone that believes in what they’re doing or believes in you. That if you don’t increase sales dramatically… I’m talking 30% per month. Then this is going to look too early. And the VCs are going to back off.
17:53 AUSTIN: Yeah, so Jeff Bezos was obviously in a very difficult situation and he needed a big win quickly. What was the presentation? You kind of figured out that they were a service. And what led you to figure out what you needed to provide them? What Amazon needed to provide its customers to be the biggest and baddest company in the world?
18:09 BERNIE: So, that was an interesting war between me and the creatives in the shop. Which is always a dichotomy between strategy and creatives, right? And the way that you get everyone on the same team is to agree on the strategy and the mission. It’s not a war of what someone likes or doesn’t like.
So the first thing that I did with my creative director was we gathered a bunch of research. We were like, “How big is the book market?”
Cause Jeff told us. Initially it’s books and then it’s everything else. We didn’t buy into everything else at the time. And we didn’t need to. We just had to buy into books. So as we studied the book market, we started looking at, “Okay, he’s not going to make books. He’s not going to discount books. So what is it that we have to do with this brand?”
I mean, doing the creative part–honest to God–we could have probably started doing the creative on day 1. But we knew that if we didn’t center the creative around something, that we’d be rudderless quickly.
And so I remember the amazing battles that I’d have going back and forth on strategy with the Creative Director. He wanted to get going on a creative team, and I was like, “To build what?” And we started gathering data. I pushed hard for data. And so we started asking… we went in and did some industry analysis. We talked to some analysts back in Boston. And we started to craft the idea that maybe Amazon wasn’t a product. They were a service.
And if they were a service, what type of service? And so we spent… I convinced my creative director to not even gather a creative team, but to bring different people in to what I called… let’s call it a strategy brain-storming team from all over the shop.
And we would meet once a week, and we would analyze the additional data that we had gleaned and then we would talk about the brand and the mission. And eventually we arrived at a place that said, “Amazon’s not a bookseller. They’re going to sell books, but they’re not a bookseller. They’re a service.”
So then once we did that, we started analyzing services that impressed us. We looked at the Ritz-Carlton. We looked at Nordstrom. And we eventually ended up on a boutique concierges, because of the way they treated guests. Know you when you come back… Get things for you. Make recommendations to you.
And when we ultimately after 3 and a half months of Jeff paying us probably 25 to 50 grand a month, with no creative, we finally showed up in Seattle and we said, “We have your brand.” We didn’t show him a logo. We didn’t show him a website. We showed him the brand persona of Amazon as if it were a human. And we said, “You are going to be a concierge that delivers the most amazing things.”
20:46 JOE: What was Bezos reception to that?
20:50 BERNIE: Well, one, I think he was a little disappointed that we didn’t have creative. But, two… he understood that he’d made the right decision in selecting us. Because his fear was that we wouldn’t be strategic. And it just reinforced in him that “wow.” Because we didn’t come back with creative recommendations, we came back with things he needed to build into the UI and UX of the site. Like, one click. Like reviews. Like recommendations. Like a little bit of AI before AI. Algorithms that needed to be done.
And so when he saw that, he knew that we had bought into the living breathing soul of the brand. And that the brand wasn’t going to be so much about visual, it was going to be about the technology under the skin.
21:43 PAT: Is that always your strategy? Not just with Amazon, but before that Amazon experience?
21:49 BERNIE: No. Not really.
21:51 PAT: Was it more of a creative thing?
21:52 BERNIE: You know, it’d be research and creative. Like, I wanted Widmer beer when I got to Portland. Then I heard a rumor that said they were going to try to go into bottles. Cause they were a pub only beer. So I was like, “Oh, I want that. That’s going to be packaging. It’s going to be bottles. It’s going to be cases. It’s going to be national advertising.”
And we won that account based on nothing but really good creative quite honestly. But the creative was integrated. Craft beer was rising. We’re like, “We’re going to take you and take you from a small, pub-only beer to a national beer brand. And we’re going to take your Hefeweise and we’re going to blow that shit up. And here’s how we’re going to do it.”
And that was our good, core traditional branding integrated marketing that was going to do that.
22:34 AUSTIN: What separates you… you’re agency apart from a marketing agency? Because we’ve talked a lot about the brand and I think that people might think they’re the same thing. Can you shed some light on the difference between the brand and marketing?
22:45 BERNIE: You know, that’s a great question because a lot of people do not understand what branding is. They probably know what marketing is because marketing is what you see. Branding is what you don’t see. Branding is the feeling that you create about a product or service very, very carefully. You know, through the visual and the messaging of what you create.
But that has to be based on strategy. Which is based, usually, on something you’re going to do very strategically in an industry and with a very specific brand-persona. So I can’t tell you to wear Nike–by saying “Just Do It.” I have to make you feel that if you see the messaging around Nike, that you will become a champion. And that’s why you buy Nike.
You don’t buy Nike cause Nike says “Just Do It.” You buy Nike because it makes you feel like you can perform at a higher level. So how do we create that feeling?
We create that feeling with a whole bunch of messages and what we’re tapping into is that everybody wants to be a champion.
23:48 AUSTIN: (laughing) I know I do…
23:49 PAT: Is there… do you have any examples of companies either in the past or ones that are currently functioning right now who are doing that the wrong way? Who are putting marketing in the spot of branding… where branding should be? The way that you explain it?
24:01 BERNIE: Well, it’s not… you don’t want to do one or the other. You want to have a level of branding strategy in everything you do in marketing. The two are deadly connected. Because I just told you, branding isn’t anything you can see. Branding is the feeling you’re going to create inside of someone… which ultimately means you have to create marketing work. But it has to be done and presented to the consumer in such a special or unique way that they start to internalize it. This is the biggest dilemma.
If you walked up to a hundred marketers and said, “What is branding?” I believe you’re going to get a hundred answers, unless you talk to someone probably… and no disrespect… over the age of 40. That’s been with a consumer brand.
24:53 AUSTIN: Right. No, that makes sense.
24:54 PAT: And then, obviously, you do have a lot of experience observing brands and working in branding over the course of the last couple of decades. What do you think has been the biggest shift in the way that brands are positioning themselves traditionally versus online now?
25:08 BERNIE: Well I love the intimacy that a brand can create with its customer. They can create such a two-way dialogue now, which is good and bad. If you f-up as a brand, you got 10 million people talking about it the next day. Right?
But you’re also… you’re getting feedback from customers on a product you put out there yesterday. That is so powerful. It would take usually months to get that kind of feedback on a certain product. You’ll get immediate reaction from the marketplace which is kind of awesome if you’re in product development. So it’s a two-way street. I kinda like it because you can create more intimacy and you can test rapidly. And then you can adjust.
But if you make a misstep, you better be ready on how you’re going to handle that misstep. Because this is where the power of the crowd can rock a brand.
26:02 PAT: Mm-hmm. And that’s what we’ve seen with a couple brands this year. I know Uber has been in some conversations around that just because of some of the negative press that’s come out around it. It’s been really interesting to see some of that news there. I know there’s a lot of other ones that we could get into as well…
26:14 BERNIE: Yeah, the thing I would say to that is that isn’t it fascinating that it’s not a bad experience with Uber that has led to the backlash. It’s a leader that is done and said some inappropriate things. I personally use Uber. I bet every one of you uses Uber. I don’t think… I personally have never had a bad experience with Uber. So if you say to me, “Bernie, what is your brand experience with Uber?” I’d say it’s pretty frickin’ good. How somebody just created a platform to unite people with cars… I mean, I find it amazing. People get in cars with strangers. I never thought I would do that in my life.
So from a brand perspective it’s awesome. But from a brand perspective, in terms of how the crowd views a leader of that brand. And disassociates it temporarily from the brand. But then reflects it on the brand. Is fascinating.
27:06 PAT: Absolutely.
You’re a pretty intelligent dude and now these days you get to teach all the stuff you’ve learned via your experience. You know, what led you to writing your new book? And what was truly the inspiration behind that?
27:18 BERNIE: So, I decided after 14 years in agencies and 8 years as a Chief Marketing Officer that I didn’t really want to sell anything anymore. Not a negative. I just couldn’t get jacked. I was jacked for 22 years on making stuff happen. And I woke up one day and the tank was dry…
27:40 PAT: Why do you think that was?
27:41 BERNIE: I think it was because when you get really good at something and you do it a number of times and then you learn you can do it and then you do it again and again and again. You just run out of challenges, to be honest.
I mean, at some point, you’re like, “Do I really give a shit about selling a cereal or a car?” It was awesome. It’s a great challenge. I turned it into a life that I loved.
But I’m at a point in my career where I’m like, “Can I get jacked today about introducing that?” And if the answer is “no,” honestly, you have to get out. Because you’re going to start doing your worst work.
And so I thought, “What could I replace this energy with?” And for me I decided going to a college campus and meeting enthusiastic puppies who don’t know how the world works. But I could dent them with my information and knowledge. I thought it would be awesome. And it turns out, after just teaching one class there ten years ago… I felt it honestly on the first day.
28:41 AUSTIN: That’s amazing. And we’re… we need more people like you who are taking that knowledge and then preparing the next generation to be the best they can be. And the thing that you’re really honing in on these days is teaching people about branding and marketing. And then equipping digital marketers… Internet marketers… to be more brand-centric and able to make decisions. Can you talk a little bit about your analysis on being more strategic versus just doing the work?
29:05 BERNIE: Yeah, I mean, clients… it’s a funny dilemma. Depending on who you are, clients will hire you to do the work. They’ll hire you to do anything a digital shop would do. And the way that you’re actually going to bring value is to bring things back to that client that are beyond what they hired you for.
It’s not that you don’t have to do what they hired you to do well. But if you’re simply going to be a task person… task agency… I’m hiring you to do X. Do X well, and that’s fine. Then at some point they will run out of tasks for you. So if you’re not strategic, you’re not entering into the strategic conversations at the company where they’re talking about what other industries should we go in? How should we handle this competitive threat? Should we tie up with this other company and be bigger? Should we introduce a new service in another marketplace?
You won’t be part of any of those conversations. You’ll just get THIS after a certain point in time. Even if you’ve done great work. “We no longer need you. We’re going in a different direction.” And because you’ve never been part of the more strategic conversations, you’re not part of where they’re going.
30:10 PAT: Right. You’ve just been kind of accomplishing tasks. Smaller, kind of menial things and not really tying it into the big picture as much. You’re not taking that consultative approach with the client and thus they don’t see as much value in you…
30:20 BERNIE: I wouldn’t say it’s menial… I would say the work you do is critical. A lot of the campaigns that you guys are doing in the digital shops are critical. You’re touching the customer everyday on behalf of the client. I don’t care what you’re doing. I don’t care if it’s content, if it’s social media… So it’s not that it’s menial–it’s just not strategic. It’s very valuable. Don’t misunderstand the value that I see coming. I see tremendous value. But there are other agencies that can do what you do and can bring the value. So who rises?
30:53 AUSTIN: I see it as disposable if you will. You can always hire someone to get the work done. But it’s much harder to find someone who has the vision to take you in another direction.
31:00 BERNIE: Or just to tell you that the work you’re doing isn’t good enough.
31:08 AUSTIN: Yeah, that’s always tough to hear too…
31:09 BERNIE: And it’s tough to do as an agency. Imagine you walking into a meeting with a CMO and you’re saying, like, “Yeah, I don’t really feel like we’re killing it for you.” It take a lot of confidence to do that, and then the CMO says “Why?” And you go, “Well, because your audience is shifting. Competitors are threatening. Your product actually got weaker in the year that we’ve worked with you. And the work we’re doing is actually damaging you now, because we’re getting more people to buy and use your product and your product isn’t that great anymore. So we’re actually pissing off your base.”
31:41 PAT: That’s pretty interesting cause I know that you came and talked to us today. Talking about how you can be turned into a commodity as a brand. If there’s too much market saturation, you’re not continuing to innovate and make strategic shifts. Is that something that you’ve seen with branding agencies or marketing agencies? Where if they’re not taking that consultative approach and adding that extra value they can just get their service prices undercut by competitors and thus be replaced.
32:06 BERNIE: Well when we were taking clients away from traditional agencies as an integrated branding shop… it’s not like the market for marketing’s going away. Let’s all agree that marketing will be here pretty much forever.
32:19 PAT: (laughing) I definitely hope so…
32:20 BERNIE: So it will be a multi-billion dollar industry. But who gets their fair share is up for grabs. So when we weren’t… we didn’t say that we wanted to become an integrated marketing shop because we saw a new integrated marketing industry niche. We saw and felt that Chief Marketing Officers and Brand Leaders were being underserved by not having the synergy of an agency like us.
So we actually just went and took clients. And took them to another place. But we would not have been able to take them if they didn’t feel they weren’t being properly serviced.
32:58 AUSTIN: And what specifically were you looking for when you went to acquire these clients?
33:02 BERNIE: Well, we looked for 2 or 3 things when we looked for clients. So just to be fair, we turned down 9 out of 10 clients that contacted us. Once we got going after 2 years, we would get 20, 30, 40 phone calls a week, from perspective clients saying, “We’d like to work with you.”
We would only work with 1 out of 10. Because we had kind of a rule. First, the brand had to be on a mission that could be identified as a rapid mission. So we weren’t going to work with GM. But we’d work with Mazda. Cause Mazda wanted market-share. So they’d be more aggressive.
Two. They had to be a potential leader in their space. Either a David… that’s cool… but they had to have the potential of being a Goliath. Or at least, knocking Goliath to his knees. Because if a brand not on that kind of a mission, then they’re just a commodity and they’re doing “Me too.”
And I think the third area was, we loved working with brands that were in emerging spaces. And I think one of the reasons we grew so rapidly, quite honestly, was this little place called Silicon Valley. So when we started our agency in Silicon Valley, we were working with little tiny companies called Adobe…
34:14 PAT: (laughing) Small, small company…
34:15 BERNIE: Yeah, and we did all the early work for… if you identified the 10 largest remaining Internet brands, we did work for all of them. And we loved it. We loved the edge of moving. Because there’s a speed and a sense of mission when you do that.
34:34 PAT: I have a question for you around that really quickly. I know that you talked today too about how leaders go against the grain. And it sounds like that’s sort of what you guys were doing in terms of qualifying your perspective clients and partners that you wanted to work with. I’m just curious… how did you guys go about determining that criteria and why did you feel that it was appropriate? If it wasn’t something that was widely shared?
34:54 BERNIE: Well, so all you’d have to do was look at the backgrounds and the personalities of the 4 partners. One guy had come out of Landor and then became the Creative Director for Apple. One guy had gotten a PhD in anthropology and had gone and worked at Pepsi and Pizza Hut. The other guy had helped Steve Jobs open up Apple France. And was a tech nerd. He was the youngest.
And if you just looked at the 4 of us in a room, we… 1) at that point in our career we were all 32, 33. We could not tolerate assholes. We couldn’t tolerate bullshit. We all had come from working with great brands and we were like, “What are the kind of brands we want to work with?” So our rules came out of that.
And then, “What are the kind of people we want to hire?” So we hired… it took a lot to get a job with our shop even as rapidly as we were growing. I would say at least 6 to 7 interviews.
35:51 AUSTIN: Pretty incredible stuff there. And that’s a lot of very great information. Let’s take this back to your book right now, because I want to pull this out for the listeners. What’s the most important idea you want the readers to take away from “Brands and Bullshit?”
36:03 BERNIE: I think, one, that if you’re a marketer today and you don’t really understand branding, you’re rudderless. The second thing I would add is, I’m not… this is not an autobiography. This is not a clap-my-back, look at me type of a book. I have put everything in the book that I’ve either learned or stolen from some of the best branding people in the world.
And I’ve put it in the book. Actual tools, frameworks, insights, guidelines so that other people can read this book very quickly and walk away and not go, “Oh, I like that book.” But go, “There’s 3 things I’m gonna start doing today.”
36:49 PAT: This is all incredible stuff. And we appreciate all that you’ve shared with us on the branding side, especially. I know that you’re time is super-valuable.
We have a few questions here at the end that we really like to ask a lot of our guests cause it’s so interesting to see how different some of the answers can be.
The very first one that we like to ask is, you know, what does your daily routine look like? What’s your day-to-day?
37:08 BERNIE: So I’m currently a director at the entrepreneurship center at San Diego State. And I teach creativity, innovation and entrepreneurship classes on the campus.
Unfortunately, I have a bio-rhythm clock that has me wake up every single day at between 5:30 and 6 no matter what the hell I’m doing or where I’m at. Which is very frustrating. Especially when I go on vacation.
So I’m at the campus before 7 AM. It’s very quiet. I walk in my office, turn the music on and go to work. I look at what I’m going to do that day. I look at the appointments I have. I look at the research I need to be doing for the programs that we’re doing so that by the time the rest of the staff wanders in around 8:30, 9, 9:30… I’m ready to go. My slate’s wide open. I have no emails in my inbox, and I’m ready to go.
Then I might have meeting on the campus. I might have students that wander into the center and ask me to pick apart their idea. I might have a class I have to teach. Every day is kinda different, and I don’t purposely try to force it.
I am a Johnny Appleseed on the campus. I am all over the campus… finding people like me that believe we’re not making students competent enough in certain areas. So I’m running workshops in nutrition for how to look at trends. I’m meeting with people engineering and talking about how software, hardware and brands get put together. I’m trying to disturb the campus on purpose.
38:33 AUSTIN: And we love that. One of our episodes we just had last time, we talked about education and the shift onto online education because you can just get more out of it. Specifically what you want to learn. And you can achieve that instead of just getting the degree, if you will, from the school. That doesn’t have as much meaning as it once did.
Moving into our next question: What’s one book besides your own of course, that you would recommend to the listeners so that they could learn a bit more about branding or marketing.
38:59 BERNIE: You know, I’m not going to give you the answer that you want. There are some good books in branding and marketing. I list probably 10 of them in my book. Including “Positioning” by Ries and Trout, and “Brand Gap” by Marty Neumeier.
I tell you what books influenced me in my life. And it wasn’t one particular book. It was any autobiography where someone came from nothing and built something. I’m an immigrant. I grew up in pretty much lower blue-collar Detroit. I didn’t know what my right was as that type of person growing up in a blue-collar environment.
By reading autobiographical books of people that came from nowhere… they didn’t come from money… they didn’t come from the rich side of the street. They came from nowhere, and they built something.
I became convinced that I could be someone that could do whatever the hell I wanted. One book that influenced me on how I wanted to set up my career so that I didn’t have to work near the end of my career. How the hell do you do that? I read “Rich Dad, Poor Dad” at some point. Somebody gave it to me. And that changed my view on how I gathered assets and spent my money for the rest of my life. And it put me, I think, in the position of being financially secure where I could do what I want. And I think ultimately… if you ever find yourself in a place where you are completely financially secure. Meaning you’re at an f-you place. Meaning if somebody asks you to do something, and you don’t want to do it, you go “f-you.”
When you get to that place, you will do the best work of your life. Because you will no longer be concerned with what people think. You will do what’s right.
40:53 PAT: Wow. That’s really good advice, too. I think that’s a book that we’ve heard is really commonly shared too across a lot of really successful people. So just to have that kind of reaffirmed I think is super-important for the listeners too.
The last one that we like to ask: If you were interviewing for a job again… not that you would have to… What do you think are the characteristics and experiences that you would talk about in that interview that would set you apart from other candidates?
41:18 BERNIE: I would ask questions… One, I’d be more prepared than anybody about the brand I’m interviewing with. I would know everything I could about the brand. And if I could track down who the hell was going to interview me, I’d know everything about that person.
And I would come in strategically prepared. I’m interviewing. That means they’ve looked at my resume and they’ve done a little due diligence. So there’s no sense in covering any of that shit. So now, what’s going to separate you from someone else. I think you have to walk in and when the interview starts, I think you have to say to the interviewer, “How are you guys going to handle this competitive threat by IBM?”
And the interviewer, who might be from HR or wherever else is going to go, “Well, shit, that’s not one of my questions.”
41:59 JOHN: (laughing) Let me call somebody else…
42:01 BERNIE: Yeah. Or they’re just put into a whole different place, right? And then that starts to set a tone of what’s really going on in the interview where you’re trying to convince them that you’re someone who understands their company, understands their mission… I remember walking in and it’s kind of crazy because apart from the very first job I had in my career, I’ve never interviewed for another job. I’ve always been recommended, and referred or recruited.
I like walking in and saying, “What’s your culture like? Why would I work here? Why would I want to work here? Describe your culture to me.”
And you start to ask questions that show maturity and depth of research and it obviously, at some point, you’re going to bring across your competency. But you’re competency can’t lead. If you lead with your competency, like, “I’m a better SEO person than anybody.” You’re in a commodity already, at that point. So you have to lead with, “How are they going to remember me in a strategic way?”
And that’s how I would interview.
42:58 PAT: Well, Bernie, thank you so much for coming in today. Again everybody, his book is called “Brands and Bullshit: Excel at the Former and Avoid the Later.” Bernie, we know you’re a busy man, so we thank you so much for your time today. And hope you enjoyed yourself a little bit.
43:09 JOHN: How’s your golf game?
43:11 BERNIE: My golf game’s actually getting pretty good, John.
43:13 JOHN: (laughing) I don’t know. I don’t know.
43:16 BERNIE: Thanks for having me.
43:18 AUSTIN: We hope you enjoyed that interview with Bernie Schroeder as much as we did. Patrick, any quick takeaways from that?
43:23 PAT: I thought it was super-useful and insightful. How he brought about… kind of talked through how he created the core competencies for Amazon’s USP. Where he pulled those motivations from, and those main ideas. The concierge example I thought was really… I’ve never heard anything like that. Especially from branding experts, so…
43:41 AUSTIN: Right. And the personalization of e-commerce is what he got into…
43:45 PAT: Right. The one-click. How do you pull those big lessons away from kind of menial… or not menial but monotonous, everyday tasks? So super-interesting stuff. I… again, we really hope that you guys got as much out of it as we did.
Again, go check out Bernie’s book. It is called “Brands and Bullshit: Excel at the Former, Avoid the Later.” Great book. A lot of great takeaways for branding, marketing as a whole. That wraps everything up for us.
Again, guys, our social handles are @flipswitchcast for both Twitter and Instagram. Again that is @flipswitchcast. Hit us with questions, feedback or comments. Or just any thoughts you want to run by us.
That wraps everything up. This has been Pat Kreidler, Austin Mahaffey, John Saunders and Joe Hollerup signing off.