The next level of producing branded content involves Hollywood, asserts Sven Lung, founder and CEO of Green Park Content, a brand publishing agency that has held an office in Brazil since 2014. He sustains that brands will increasingly become entertainment platforms and the demand for quality content will trend significantly higher in the next few years with the proliferation of streaming services like those from Apple, Disney, Netflix, Hulu, HBO and Amazon Prime. An entrepreneur and a member of a few investment funds, including the e-commerce-focused Draper Esprit, Lung says he grasped how powerful the content would be when he worked as a consultant for the News Corp group in Australia in 2007. Since then, he decided that, as an investor, he could rely on content as a way of adding financial value to the brands.
By Luis Gustavo Pacete
The French-born entrepreneur and serial investor was the founder and CEO of the online fashion retailer BrandAlley and one of those responsible for launching the digital fashion outlet Privalia in France and the United Kingdom. He has founded and remains an active investor in startups such as ScanPay, a company that holds a mobile payment method technology, and launched Green Park Content in 2014, an agency specializing in brand publishing that serves a variety of clients, like Unilever, Danone and Diageo. He was one of the consultants involved in restructuring media companies at News Corp in the United Kingdom.
Meio & Mensagem – You are a serial investor and have based your career on working with investment funds. What led you to believe that content could be an asset with high returns?
Sven Lung – I worked for many years as an entrepreneur in e-commerce. When I worked on the Privalia project (digital fashion outlet) in France and the United Kingdom, I recognized the dynamics and potential that e-commerce has as a converter of resources and a way to stimulate business. When I later took part in certain News Corp joint ventures in Australia, I saw the power of content as an element of conversion into sales. Brand content isn’t viewed as a part of the business strategy yet, only as a marketing tool. But good content has the power to convert, as well as generate sales and leads for brands. And that’s when, as a member of a fund, I began investing in brand publishing, which is basically the content as the drive for transforming brand dynamics. From back then up to today, Red Bull has demonstrated to us that there is a rather significant relationship between content and passion that, if done right, and rooted in an ecosystem that involves other tools, enhances the brand and converts.
M&M – Red Bull is indeed one case in terms of content production, but doesn’t making this model available to other brands with different origins and dynamics seem like a challenge?
Lung – I get that there’s an initial challenge to understand how to invest, create structures and redirect investments. But there is a pressing and fundamental need for brands to position themselves through their own content. I can speak on the case of Europe, where TV consumption has dropped. Teenagers are not watching TV, they are on Google, YouTube, Netflix and they have, of course, a distaste for advertising. Even though Google and YouTube, unlike Netflix, are advertising environments, these young people don’t embrace it. It’s a generation characterized by the “skip”. And it’s more than just engagement, it’s about brand value. Take the case of Heinz: if you look at the results disclosed in February, the company lost an estimated US$ 15.4 billion in the market and one of the causes suggested in the company’s own report is the loss of its brands’ strength. Who will be next? Unilever, Mondelez? It’s about results. If your consumer isn’t regularly watching TV or doesn’t want to receive intrusive advertising any more, how can you maintain or add value to the brand? And this is one of the dilemmas facing the digital transformation of major consumer companies.
M&M – Branded content has become a new opportunity to offer brand content, but is it conceptually different from brand publishing?
Lung – For a long time, brand publishing had been confused with branded content, and they are completely different concepts. By definition, branded content uses the principle of paid media to drive content. Even though it comes from an idea of being organic, it isn’t, because it uses vast amounts of investments to provide content to the consumer. Brand publishing is the opposite. The brand conforms to a landscape of relevance, a demand, a feeling, and takes relevant content to match this audience. There are billions of searches on Google every day for tips, how to apply the best makeup, get the best hairstyle, how to prepare a specific recipe. Doesn’t it make sense to join this conversation and place an ad? Or does it make sense to produce worthwhile content that can really add value to what these people are searching for? It’s not about the influencers you’ll pay to speak highly about your brand, or the links that you’ll promote in Google. It’s about your relevancy as a brand and the content you offer to the product you sell.
M&M – How does this content get to be accentuated without relying on promoted media?
Lung – In branded content, people aren’t necessarily searching for your content. In brand publishing, they are. It’s organic. People will search for something because they like it. It’s the value of the content. Consumers started the conversation, and not the other way around. But here is where the importance of the ecosystem comes in. How do I use the SEO (search engine optimization) to help the consumer find this content? How do I create the appropriate traffic strategy? It’s not just about content, but about creating a relevant ecosystem. It’s about having Unilever be my coach when it comes to hair. Or Mondelez advising me when the topic is a recipe for a dessert. I’ll attempt to be politically correct in this placement: it’s easy for an agency to drive media. Brazil is a really specific case in this regard. I don’t want to become an enemy of the local market, but that’s the definitive challenge: to demonstrate that a brand needs to break some media distribution patterns in order to grow in content. Part of this process includes the creation of studios and the development of content areas that we’ve already witnessed on a larger or smaller scale.
M&M – What would the factors be that could justify brands investing more in producing content?
Lung – The cost for acquiring digital media is one of them. In London, the United States and Brazil, the cost-per-acquisition for each click is rather expensive on Google. And from my experience with e-commerce, the cost per click often eats into the profitability of a product. If I produce good content, I direct traffic to my page and I have a proprietary platform, converting in a pure manner, generating leads and transforming into sales, along with speaking directly to my consumer. I’m not saying that the brand shouldn’t be on the platforms, or should radically change its strategy. But they can’t become overly dependent and have tight margins. They should make an intelligent measurement of what they are investing in. If you do well, your content will be linked to. On top of that, it has a direct impact on building the company’s value.
M&M – How does this impact on the financial structure of the company?
Lung – Another major challenge of brands, like when I spoke about Heinz, is maintaining its value. When you take a closer look at the composition of a stock or the value of a company listed on the stock market, the loss in the value of the brands can be viewed as a significant warning. And if we have a problem in the brand assets of major companies, I feel that the strategy needs to be revised. If young millennials aren’t familiar with what a Coke is and are opting instead for Iced Tea, something needs to be changed. And this isn’t any longer about engagement, it’s no longer about having a brand known for its creativity. This is a challenge that goes right up to the CEO, it’s on the table when it’s time to talk to investors, it’s become a subject for the CMO. There is a chronic problem in major stock market-listed companies on the fast track to losing brand value. And how do I fix this? Do I call my agency and put more money in TV? It doesn’t work.
M&M – You mentioned some brands’ dependence on platforms like Google. How does a new player like Amazon, which has also been growing in advertising, influence this ecosystem?
Lung – I’ll give you an example just from Amazon UK: if you search on their site, you’ll find Amazon’s Amazon Coffee, Amazon Napkins, Amazon Tea. Amazon has flooded its site with its own brands. And where is Nestlé in all this? And Unilever? What Amazon exerts in this ecosystem is an imposed logic of investing in advertising. If you don’t advertise your chocolate on my website, it’s not a big deal. I have my own chocolate. And it’s aggravated when you consider voice assistants and the internet of things. How will your brand be remembered in such a competitive ecosystem if isn’t present and relevant? And when an Alexa user wants to create a recipe?
M&M – E-commerce itself, a recent strategy by companies like Coca-Cola and P&G, is an important link in this ecosystem. How does it integrate into the content?
Lung – It’s important because it’s part of building a community that begins with content. If you’ve provided relevant content, brought traffic to your content platform and want to convert, you have the chance to bring it over to an e-commerce site. It’s a complex strategy incorporating content, SEO and constructing a digital journey. This helps explain why e-commerce has become part of the digital transformation of companies and why it has become an essential tool for marketing.
M&M – Considering that brands begin to consistently invest in content and witnessing the streaming movement – Netflix, Apple, Amazon, Disney – aren’t we becoming oversaturated?
Lung – There’s a huge opportunity here, and this is the next step in this discussion on content. What’s going to actually happen is that there’ll be a lack of content. With so many streaming platforms, the demand for solid content will be massive. Why not have a series featuring your brand on Netflix? Like Red Bull TV already has? Or like Lego has produced? I see a direct relationship between producing quality content, offering quality content coming from brands, and bringing brands closer to Hollywood.
M&M – In this case, aren’t we running right into the issue of investment and the intent of a brand?
Lung – In terms of investments, we’re not talking about new money. It’s about readjusting the budget and redirecting investments. What’s the cost for producing and running a TV campaign? What kind of impact does strengthening the brand have on your company’s value? And on the purpose of a brand? We are at a time where the discussion is on the presence and accessibility of a brand, not closing in on a potential market and segment.
M&M – Take the examples of Uber, Airbnb and other companies that have impacted their respective segments. Have they done something different in terms of content compared to the major brands?
Lung – I have a really clear example coming from a startup called Glossier, an e-commerce site similar to Beleza na Web. They took that dynamic mindset and performance meshed with content. They’ve created a content platform called “Into The Gloss” where they provide interviews, product reviews, and analysis from influencers on the product. They’ve combined this with their networks and their e-commerce in such a way that they’re converting and have become a great example in terms of the production of content aligned to performance. With the dynamics they possess, these companies have become leading content producers and the fact that they are digital first made the marriage between content and performance natural.
M&M – We’ve had a recent growth of Vice and BuzzFeed as solution content providers for brands, platforms that are currently going through the challenge of redefining their business models. Which path do you think they’ll take?
Lung – These platforms have emerged as excellent alternatives for social content and entertainment. They started off with an interesting business model that responded to a demand. At this time, there’s an adjustment in the dynamics of social media platforms that also have an impact on what they’re delivering, but I believe they will rediscover this model.