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tv   Political Capital With Al Hunt  Bloomberg  March 16, 2014 8:00am-8:31am EDT

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>> advertising cannot [bleep] anyone anymore. you cannot pull the wool over someone's eyes. >> traditional advertising is finished. being a great company is the new strength. there will be not anything between the consumer and the company. >> the essence of every great brand is trust.
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>> advertising is going to become a word that we look at fondly and wonder -- we used to do advertising long ago. >> we used to watch ads to get information about products. we used to sit through commercial breaks. most importantly, we used to trust what brands told us. as the years passed, that trust has been tested. >> winston cigarettes deliver flavor 20 times the others. wilson has the blend. >> nose, throat, and accessory organs are not affected. >> we learned that cigarettes were killing us. we learned that the auto industry put more emphasis on imagery than safety.
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we discovered child labor in our shoes. and lead in our toys. and then, it got worse. >> federal investigators put out their final report today on that bp oil spill. >> the occupy wall street movement has spread to more than 1000 countries. >> edelman issues this financial trust survey. they came out in january and showed the lowest level of trust in u.s. corporations in history. people do not believe ceo's or advertisers. >> brands are naive to believe that they have full control of their perception out there today. i think with social media and the speed with which things travel today, there is no way to hide it. >> we have lost our faith in corporate messages. now, we turn elsewhere to find the truth. we share what we find.
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there are 5.1 billion searches conducted on google every day. there are over 1000 facebook and twitter posts per second. meanwhile, 100 hours of video are uploaded to youtube every minute. >> $24 million worth of bribes exchanged between walmart and federal officials -- >> consumers are not just exposing unethical behavior, they are exposing the quality of the products they buy. >> asics split second, wrestling shoes, excellent lateral support, five stars. everlast gel glove wraps, not enough wrist support. i am semi-retired, and my two favorite things are coming to the boxing gym and reviewing products online. i consider myself an average
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consumer. the only difference is, i review everything i buy. whether that is beauty products, home and garden products, boxing equipment, sports equipment -- i review it. i have written over 900 reviews. those reviews have been read by over 1.4 million people. i'm a fairly opinionated person. but in social situations, i usually keep those opinions to myself. writing reviews for me is a great way to get my voice out there to be heard. cover girl, smokey shadow blast -- crap! the lovely drew barrymore and all of her ads -- this wears off in one minute. you would think that companies knowing that their product is being reviewed and talked about. it would occur to them to make better products. but i do not think that is necessarily true. i am not sure at all that it's true.
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there is still a lot of crap out there. trust me. >> you are watching an ad for crayola colored bubbles. it looks awesome. your kid would love this. so you go online, you're about to buy, and then -- you cannot miss it. it is inches from "add to cart." and it is bad. every single reviewer gave it one star. only because zero stars is not an option. if that is not enough, they have taken pictures. they look a little different than the commercial.
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>> what can brands learn from me? i do not know. for me, it is staying true to myself. i can remember coming in when i first got signed up. there were 12 suits around this table. they were trying to create my image. those who have their image created -- it never lasts all the way. i told them from day one. image is reality. what you see is what you get. ♪ >> consumers have changed
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dramatically. advertising is almost the same as it was 50 years ago. dollars have shifted online. strategies remain the same. print ads became banner ads. junk mail became spam. 30 second tv ads became 30 second pre-rolls. >> display advertising put on blinders on digital creativity. it made it really easy for organizations to shift money on balance sheets. and not have to think different. >> why do we have aflac? and major medical?
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>> change is difficult in an industry. look at health care coverage. they have had an image problem for years. >> our dollars pour into their bonuses and administrative costs that do nothing to make us healthy. that often go toward figuring out how to avoid covering people. >> safety net. >> what is the best way to combat this image? talking animals. >> aflac, aflac. >> a little more duck. >> a little more duck. too human? >> can you throw yourself into it? you are quacking, you are moving. become the duck. start making it you. >> i talked to the ceo. i talked to the p.r. people.
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i tried out to be the aflac duck. i wrote a column about it. i'm still not sure what they do. that's the thing. i have farmers. i don't know why. i don't know what their ad is. i hate confusing state farm and farmers. i think they are separate things. why are they all involved with farms? when i was a kid, i knew the ads. i knew the jingle. i can sing you jingles. now, i tivo through them so quickly. there is so much advertising. it is a blur at this point. >> ♪ i'm through with romance ♪ >> advertising is less effective than ever before. it is coming at you in so many directions. is there anywhere i can look that doesn't have an ad? >> today's consumers are exposed to 5000 marketing messages per day. that is more than double the previous generation. the only thing creepier is the
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fact that someone is trying to sell us something while we urinate. >> advertising has played a central role in how we function as a society. it is the connection point between consumers and corporations. the definition of advertising has to evolve. companies have to shift away from saying they are great, to actually being great. >> brands are a collection of experiences. it is not about coming up with this big branding campaign. it is about how you are creating lots of little experiences. small experiences that are going to get them wanting to come back for more. it has to start small. small steps lead to larger sets of experiences, and build a brand from the bottom up. it's not from the top down. >> there is going to be a place for funny, creative, emotionally engaging ads. what if advertising can be more
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than just ads? what if delivering better products and services is a form of advertising? what if advertising can help companies be more transparent? or more socially responsible? or just more helpful? what if advertising can help the corporations be better? for 20 years, alex was advertising's most gifted storyteller. >> i'm a pc. >> i'm a pc too. >> do you know what else is cool? we can switch our heads around. >> the stories he told were funny and ironic. his own story was more straightforward. he simply dominated the industry. he transformed an agency into the top creative shop in the world.
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they won agence of the year 13 times. alex was awarded creative director of the decade. that is where the story takes a turn. he started saying stuff like -- >> a fundamentalist capitalist is as dangerous as any kind of fundamentalist. >> he wrote a book about america's obsession with oversized meals, this coming from the man who created this ad. >> ♪ eat it, eat it >> triple whopper - eat it like a snake! >> the conversations i would have with my clients at big corporations, they seemed false. you didn't want to have any more fake conversations. i was done. >> at the age of 46, at the height of his career, he quit the advertising industry.
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greensboro, alabama is one of the poorest small towns in america. >> capitalism is in crisis. we do not have to look very far around. you can look in this town. there is a crisis. it has been around for a while. look at middle class america, it got hammered. we are here because we want to start a new kind of bicycle company. it is a bamboo bicycle company. these last longer than steel and aluminum bikes. a stand of bamboo sequesters more co2 than any biomass. there is a lot of energy around bringing it to alabama as a cash crop. >> half the kids in greensboro grow up in poverty. in a town of less than 3000 where many storefronts are permanently shuttered, he's hoping to make an impact on the community, while making profit at the same time.
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the bamboo bike is the pilot program for a larger project called common. his goal is to launch 1000 socially conscious ventures. >> i think i'm not the only one with frustration with the constricted conversations happening in corporate america. >> when common has a board meeting, it is broadcast live online. it is not all good news. >> we were having real conversations about where we would pollute, where we would mitigate that, and everyone was involved was out of some aspect of corporate america. they were jazzed to finally be having that conversation. it is going to change radically from what is a fictional story that stood between you and the company, to real-time truth about your company. can you, through that, compel me to buy? what i always say is, transparency is not a choice.
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does it happen to you, or do you participate? when it happens to you, it has proven to be ugly. >> in 1997, researcher dara o'rourke was at the forefront of the transparency movement. he traveled to vietnam as part of a study on factory conditions. >> one of the places i did research in was a nike factory. a koran-owned factory producing nike shoes. 2/3 of the women had respiratory diseases. there were violations of overtime and wages and sexual harrassment. at the time, nike said, not our factories. korean dude in vietnam, go talk to him. i came back to the u.s. and i wrote a report.
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>> as reports of labor abuses flooded the news, nike's market cap fell by over $2 billion. >> their running shoe is rubber, nylon, a little bit of color and design. what they sell is a brand, a lifestyle and a reputation. that was being threatened. that was in 1997, the beginning of the internet. now the flow of information about problems in your supply chain is going 1000 times faster than it was. >> in 2007, he founded a website that puts transparency into the hands of everyday consumers. goodguide rates products on health, environmental impact, and social responsibility. the app is totally customizable. goodguide doesn't care if you want to save the environment, save your beauty, or simply save money. as long as you see the information that matters to you.
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when you are shopping online, goodguide warns you when you're about to buy a product that doesn't meet your standards. it also recommends alternatives. with the goodguide mobile app, you can walk into a store with x-ray vision. >> that was the impetus for goodguide. to cut through the marketing. to cut through the claims on the packaging. new and improved, natural, nontoxic, or whatever. so the consumers really have more power than they have ever had before. they can vote with their dollars. goodguide is a unique offering. it is the tip of the iceberg of new types of information coming to consumers. where does petroleum come from that goes into your plastic toy? where does food come from that is in your organic cereal? we couldn't know that three years ago. as we have been doing this project, there has been scandal after scandal in the marketplace. >> links between high consumption of bpa and heart disease. >> the discovery of horsemeat disguised as beef has kicked off
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a crisis. >> how would you even know it was in a product you were buying for your child? >> that has turned this issue into mainstream consumer issues. >> as for nike, the company has made major efforts to clean up its supply chain. nike is now one of the highest-rated apparel companies on goodguide. ♪
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>> i'm going to hand you stuff and you're going to tell me what it is, ok? what is your name? >> superman. >> superman, what is this? >> baseball. >> very good. and can i see it? thank you. what shape is that? >> triangle. >> very good. can i see it? thank you. what color is that? >> green. >> what color? >> green. >> very good. can i see it? tyler, will you turn this on and play your new "cars 2" game? >> before kids learn the basic shapes and colors, they interact with information was previously only available in supercomputers. access to information is growing at exponential rates. tyler's world will be completely transparent.
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engineers are developing interactive glass that turns every surface we touch into a tablet computer. these images may seem futuristic, but the underlying technology already exists. within a few years, we will be surrounded by screens wherever we go, every moment of the day. someone at m.i.t. is doing away with screens altogether, enabling ratings and reviews to be projected wherever we want. >> there may be a war going on in the retail environment and online where one side will be slamming us with ads everywhere we look, trying to weasel into other parts of our life into our family conversations, our photo sharing, all over. they are going to be trying to infiltrate. but at the same and time, consumers are going to have tools to see through all of that. >> consumers are just beginning to realize the power they have. meanwhile, corporations face a
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choice. they can try to stop the revolution, or they can embrace it. >> patagonia is a great example of a strong brand that has said we're going to go as transparent as we can. >> anyone working in the environmental field knows if you're not talking about what is you wrong, you're not telling the whole story. >> you do not have to be worried about telling everybody the bad things you're doing, as long as you say that we are working on these things. if you try to be dishonest, try to hide it, it is going to come back and bite you in the [beep]. >> they did something called the footprint chronicles. they put up on their website the story of the products they were selling. >> it was one of the first really progressive approaches to transparency. through their choosing, they came to people and said we are going to show you how our
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products are made. when i looked at it, it is not good news. >> this is patagonia, the outdoor brand talking about, we put toxic chemicals on your jacket you are wearing. >> it is so common to say what is the challenge? what is the opportunity? no, it is bad. it is just bad. we laid it out there. here is what is good. here is what is bad. then what we think. it was a scary notion. if we put it out there, it turns a lot of confrontations into conversations. >> the consumer has proven that they do not expect perfection. time and time again, when companies have used transparency right, the consumer has looked and said, it is not perfect enough, i'm moving on. they are realistic about it. >> i do not think advertising is enjoying the same luxury once had. we are all skeptics. we have heard far too many times.
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clear is the new clever. you need to be clear in your messages. clever doesn't work anymore. >> recently, patagonia was called upon by walmart because walmart wanted to figure out their sustainability index. suddenly, this relatively itty-bitty company had infected ideas that were going to be radical. in a company that represents the 19th largest economy on earth. walmart is bigger than norway. >> at walmart, energy makes up a huge amount of our cost. that is why we are in texas. we are using wind power. >> walmart has a lot of negative press over the years. but going green isn't just good for the company's image. by lowering waste and increasing efficiency, walmart is actually helping its bottom line. >> they're convinced that they can actually make more money. that is where we come in. i'm convinced of that myself. every time we make a decision that is right for the planet, it
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makes us more money. >> walmart isn't the only huge corporation that sees profit in going green. unilever is the second biggest advertiser in the world. it announced a plan to cut its environmental footprint in half over the next 10 years. >> waste costs money. it costs money to produce it. it costs money to get rid of it. that is the most basic. but if you go up a few levels, you need to have a healthy start to have a healthy business. an unhealthy society is unsustainable. >> every day, unilever products are used by over 2 billion people. that is a bigger consituency that any country on earth. at this scale, a simple decision can have a major impact. >> one of the things that we say, we can do well by doing good.
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a really good example would be the concentration of liquid detergents. in taking water out, concentrating the detergents. it has made smaller packaging, lowered the shipping costs, and storage costs. when there is a win all around, there is no reason why we shouldn't make the planet benefit. >> it sounds like a small change, but consider that unilever detergent is used by one out of three households in the world. at that level, there is no such thing as a small change. ♪ >> compared to unilever, under armour is a small company. but it is also making big changes to its business model. its green clothing line started with used water bottles. they are spun into fabric. in 2011, under armour recycled 2 million plastic bottles.
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>> the definition of advertising is changing. it is not built by those who spend the most money. it is about those who have the best product. those who are about driving and dictating with a point of view. the best merchants are those that dictate the future, not the ones who are trying to predict the future. we are trying to push our suppliers. we need renewable fibers. our consumer is interested in this. more importantly, we are interested in going in this direction. consumers typically won't pay more because you are telling them it is a green story. but if i can create a product that performs better, you feel great about wearing it. we call it a gift with purchase. the principles of green are completely in line with the principles of business. it means doing more with less.

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