Narda Shirley

One of the defining characteristics of challenger brand start-ups in the food industry is that they are unencumbered by legacy. They can source from where they like and the entrepreneurs behind the brands can lay down any number of guiding principles that give their brand a feel good factor that helps it stand out. Whether it’s good for the environment, good for producers, good for you, or a combination of all three.

‘Doing the right thing’ and ‘making a difference’ are often cited by entrepreneurs as their driving motivation for the hard graft of getting a new business off the ground. So it’s vital that they weave that ethos into the brand communication, making their values part of their business DNA.

But what happens to these small companies when they grow? How hard is it to maintain an ethical stance that is pragmatic and profitable at scale? Is the cycle of growth and sale to a larger, deeper pocketed company in part about being able to afford to stay true to your founding values? Or is there always a compromise once the entrepreneur cedes control to a bigger corporation?

We took a cursory peek at 3 British brands that have sold out – in each case ending up in the hands of US corporations.

Husband and wife team Craig Sams and Jo Fairley launched Green & Black’s in 1991, the first Fairtrade chocolate in the UK, sourcing directly from farmers in Togo and Belize who were rewarded with higher prices for using environmentally sustainable practices. Green & Black’s worked with William Kendall’s then private equity firm, Nemadi which engineered a sale to Cadbury in 2005 (which in turn was acquired by Kraft in 2010). An interview with Fairley in 2013 revealed that Green & Black’s Head of Sustainability went on to do the same much larger job at parent brand Mondelez. Fairley also cites Green & Black’s influence as the reason Cadbury first went Fairtrade with Dairy Milk setting off a domino effect that also saw KitKat and others follow suit. So it would seem in this case, that an early adopter challenger brand became a Trojan Horse change agent inside the major brand that acquired it.

Pret a Manger hit on a successful formula based on principles of product freshness, avoiding additives. Pret also started its own foundation to help feed the homeless. In 2001 McDonald’s bought a third of the business, which was later sold to private equity firm, Bridgepoint. In the meantime, McDonalds has successfully turned its own brand credentials around in terms of building a reputation among consumers of having an ethical supply chain. But back then, the perceived differences in values perhaps helped prompt this quote from Pret that “McDonald’s has never had any day-to-day role in Pret, nor has it had any say over what we do, nor how we do it.” (NB. Julian Metcalfe, one of Pret’s original founders went on to open Itsu. Proof perhaps that there’s a certain type of entrepreneur for whom once is not enough).
Paul Lindley founded Ella’s Kitchen, the UK’s bestselling baby food company, without a shred of retail or food industry experience. He did however have a background in media and children’s brands from Nickelodeon. He is quoted as saying “What has always driven me is the idea that business has a responsibility to be good for society.” Founded in 2006, Mr Lindley sold to US food company Hain Celestial for $103.5m last year. Hain’s main website offers up a slightly dated CSR Report from 2012, but it is front and centre on the home page which at least demonstrates the emphasis the company puts on its sustainability credentials.

In each of these situations, the challenger brand has led with its values and sustainability message. As an entrepreneur growing your own business, you get to decide what you stand for, and how you communicate it, without having to justify it to analysts or shareholders. It’s heartening to think that brand values that were once perhaps viewed by the city as a potentially costly indulgence by entrepreneurs are now increasingly priced in at a premium when it comes to a sale.

Beverly Amira

This last week has been consumed in a flurry of activity for Maarifa in Nairobi – a company set up by a serial entrepreneur who believes in the power of education to lift and propel a nation. Maarifa’s CEO Scott Royster is a man on a mission. He is already successful, having floated a media company in the US, so he has nothing to prove, so what is it that now drives him? Like many other entrepreneurs working in Africa today, I believe Scott is driven by profit with purpose. He won’t deny he wants to make money – in fact it is essential to his private equity investor, ECP, that he can show a return on capital. And it’s essential to the universities that Maarifa invests in that Scott and his co-founders know how to make money. World class tertiary education is not sustainable on a shoestring.

Being able to challenge the status quo, make a difference and turn a profit is a tall order. But entrepreneurs – successful ones, at any rate, are extraordinary people who can do just that. Which brings me to another entrepreneur, Njeri Rionge. Gong has been working with Njeri for a while now, helping put the power of her personal brand to work. Oscars night was made all the more special for having a Njeri on the red carpet. She hasn’t added film producing to her impressive skillset, but she has appeared as the ‘talent’ in a new ad for Cadillac. ‘Dare Greatly’ is a new multi-channel campaign that features a diverse mix of talented people from Silicon Valley entrepreneur Steve Wozniak to Boyhood film director, Richard Linklater. Njeri is there for her great daring as a former hairdresser who propelled herself to the point where she brought internet connectivity to ordinary Kenyans in the form of Wananchi – the company she founded. It’s extremely gratifying to see Kenya represented in that line-up, let alone a black woman. We’ll watch the fortunes of Cadillac with interest on the back of this new campaign – who knows, it may just qualify as a ‘challenger brand’ with all this edgy new attitude!

Staying with cars, I want to highlight the work of a very different marque – Mobius Motors, a Kenyan company that makes affordable off-road vehicles. They came to our attention through our work for Garden City. Behind the brand is social entrepreneur, Joel Jackson who discovered the big challenge facing rural Kenyan communities is immobility. His vision is to build more affordable cars designed for degraded road environments.

To keep costs down Mobius strips the vehicle of non-essentials, such as power steering, air conditioning and even glass windows (!), and instead invests in suspension and handling. As such, Mobius has dramatically reduced the cost of its cars putting them within reach of small business owners. Like all successful entrepreneurs, Joel has a bold vision; to build Africa’s first mass-market car brand to aid economic growth and create a positive social impact. That’s what I call a driving ambition.

Narda Shirley

I heard the story that Jo Malone used to be a beauty therapist working for private clients in London before her fragrance empire took off. Listening to Desert Island Discs, I was intrigued to discover that she had learned about cosmetics as a child going to work with her mother and later taught herself from books. In this case, an entrepreneur’s inspiration was forged from early life experiences rather than the yearnings of an executive at a big fragrance house to go it alone.

So I started thinking about the ways that entrepreneurs are inspired and whether there’s a particular profile of person who manages to launch the definitive challenger brand of their time. Let me define that a little bit better – I count Soho House, Green & Black’s, Sipsmith, Daylesford Organic, Firmdale Hotels, Moneysupermarket.com, Lastminute.com and Workspace among great challenger brands in that category.

When I think of all the entrepreneurs I have worked with, they do seem to fall into two camps: People who are industry or sector experts who start their own business to improve on an existing product or service (these are the SYC entrepreneurs – keep reading, all will become clear). And then there are the people who seem to just appear from nowhere with something so fresh and new that it redefines a category. I call these the NSYC people because you – never saw them coming. Of course technology, and more specifically the internet has massively increased the ranks of the NSYCs. The tech stuff is well documented. From Ariana Huffington to Jeff Bezos, I’m not going to give a second’s more thought in this blog to ‘digital disruptors’. As a group, the SYCs are generally much less feted by the media, but I’m willing to hazard that their overall success rate is much higher in aggregate.

Another way of thinking about this is whether people sit down and try very hard to invent a challenger brand, or whether the idea is etched into them by their daily experience of working in a company that just can’t or won’t step up. I think that there are many professional services businesses that fall into this latter category. From what we’ve seen of lawyers, management consultants, search firms and innovation teams, it’s very hard to truly innovate in the service sector without sacrificing margins, mainly because it’s people who deliver your brand experience. And if you want the best people in a competitive sector, you need to develop them, or be able to afford to pay market rates.

From a communications perspective, the NSYCs are a dream to PR because they satisfy our constant hunger for the next ‘new’. But let’s be honest, we Brits like a challenger brand, full stop. There’s something deeply attractive about the idea that an earnest entrepreneur is out there somewhere burning the midnight oil trying to create a much better customer experience. Perhaps it’s being cared about as customers rather than the incremental service gains that we really fall for.

Sarah Nicholas

Last week saw the Economist Events’ inaugural World Water Summit, convening leading authorities on water management, governance and policy, sanitation, international development and innovation. Staffing the press desk for the Summit, we had a busy day securing no fewer than 34 interviews between speakers and media, and listening with interest to the discussions bouncing between keynotes, panellists and an expert audience.

An interesting theme raised by several speakers was the need to end the ‘stand-off’ on communicating the issues around the water crisis, whether this is companies talking to their investors, shareholders asking pertinent questions, or governments and NGOs campaigning to change toilet habits around the developing world. With the first UN World Toilet Day being celebrated next week, the stalemate is thawing around the ‘loo taboo’, with speakers from agribusinesses such as Syngenta, environment ministers from around the world and non-profit organisations such as WaterAid and the Gates Foundation pursuing ‘faecal sludge management’ systems as innovative solutions to expensive sewerage infrastructure. News that only about 35% of government-built toilets in India are used shows that infrastructure and innovation must be combined with a sustained communications campaign to change aspirations and behaviours.

In the financial community too, people are beginning to speak up about water and why it matters for investors. The Prince’s Accounting for Sustainability Project is tasking investors, accountants and businesses to ‘measure what matters’ and consider natural capital as well as the more visible bottom line. Meanwhile, Ecolab is helping businesses to translate the risks and rewards of water management into hard figures and actionable information through the Water Risk Monetizer, launched at the Summit. Never has the time been more ripe to start talking about the real impact of water and sanitation.

Read more in this selection of coverage from the Summit:

The Telegraph – Geoffrey Lean column

BBC World Service – Business Daily ‘Worldwide Water Crisis?’ podcast

Huffington Post – welcome address by HRH The Prince of Wales

Thomson Reuters Foundation – interview with Barbara Frost, CE of WaterAid

Farming First – Key themes for Agriculture

Search #WaterSummit and @EconomistEvents for more lively debate

11th  November 2014

Sarah Caddy

Having recently blogged on the dearth of innovation in insurance, it seems only fair to give stage to those ‘disruptors’ that have emerged to create new opportunities.

A few years ago, industry experts predicted that specialist insurers would disappear. Insurance was becoming more commoditised, heralded by the advent and potential threat of non-traditional industry players, like Google, which purchased BeatThatQuote.com (a one-time Gong client and insurance aggregator) in 2012. Speculation around the internet giant’s threat to the insurance industry through its ability to innovate at speed was well documented (here).

And yet we have witnessed a specialist insurance boom. Players don’t have to go on to aggregator sites to keep costs low. Distribution is key; capturing the various distribution channels is the pathway to success. Carving out space alongside the aggregators in a distribution landscape – which, let’s not forget, many thought would be dominated by aggregators only – are a few stand out specialist brokers, such as Hastings Direct (with its low operating cost base and focus on car, van and motorbike insurance) and Brightside Group (which has grown through acquisition since its launch in 2001 as a provider of motor insurance for small businesses).

So what do these companies bring to the insurance space, to make them grow so successfully? So often it is coming down to marketing and technology.

To focus on one small point, take Simply Business, a UK small business insurance broker. From a twitter account (@simplybusiness) opened in 2008, the firm now has 30.6k followers. These followers are attracted to the specialist content targeted to its SME customer base:

Look too at The BGL Group (@The_BGL_Group; 712 followers) – just named “one of the largest mid-market private companies in Britain”, according to the latest Sunday Times Top Track 250. The firm has turned comparethemarket.com into a household name, and is set to shake up the life insurance market with a new marketing campaign for Beagle Street.

We may not be able to predict the future of the UK insurance industry, but these companies are proving that it’s not time to chime the death knell yet.

4 November 2014

Sarah Caddy

If you’re following the right people on twitter, you’ll know that Towers Watson’s #ERMForum took place in the Netherlands in early October. As ever, guest speaker Dr. Pippa Malmgren got to the crux of current insurance debate with her Thought of the Day for TW’s audience of insurance Chief Risk Officers:

How much time are you spending on the big picture risks?

 Very little, it seems. Aon Consultants reportedly lamented last month that insurers are opening themselves (and the world) up to imminent liability by failing to mitigate against global, unprecedented disasters. Instead of acknowledging that new risks such as cybersecurity and hyper-connectivity are desperately in need of insurance innovation*, insurers predominantly continue to focus on smaller risks, such as health and vehicle insurance. This, Aon explains, is because there is a wealth of data and experience available to inform decisions relating to these risks.

But perhaps a more pertinent threat – and one related to product provision – is that posed by ‘local markets’ within the global insurance market. While global insurers like Lloyd’s rode to well publicised success from demand for insurance in faster-growing regions in the past, insurance coverage is increasingly being provided by local insurers and alternative insurance hubs.

As indicated by recent statements by Leapfrog’s founder Andrew Kuper, insurance industries in emerging markets are developing rapidly. How long is it before the competition will reduce the need for brokers to source coverage from London? Signs have already begun, with Catlin opening its Singapore branch to underwrite insurance and reinsurance in the Asia-Pacific region in January 2014.

Recognising this threat, Vision 2025 was launched by Lloyd’s to keep pace with the emerging markets. By proactively developing products in emerging risks, Lloyd’s could confront future competition by making London more relevant – a timely endeavour.

*The notable exception to this – Tom Ridge’s specialist cyber insurance company – was also announced as launching last month by the FT.

It’s true what they say – no two days are the same in PR, which is what makes it such a stimulating career path. However, prospective interns may be curious as to what a typical day looks like at Gong. As a small, boutique agency, you really can do some meaningful work in your two weeks. Don’t expect to get stuck photocopying or doing endless coffee runs, they’ll be plenty of projects for you to assist with.

9am: I arrive at the office after a 5 minute walk from Bond Street tube station, having picked up several newspapers from a local news agents on the way in. At the start of the day, I’m responsible for scanning the papers to see if there are any articles that may be relevant to Gong’s clients and their respective industries.

10am: The team assembles for the weekly meeting, where objectives for the upcoming week are outlined and delegated. The seating plan is rearranged on a weekly basis so that everyone can share ideas. There is also an opportunity to celebrate successes from the previous week and present individual ideas for group discussion.

11am: I take to the phones to inquire about dates, locations and nomination deadlines for an array of sustainability award ceremonies. Events of this nature offer a great opportunity for companies to raise their profiles and receive professional recognition.

12pm: One of our clients has landed an interview in a couple of weeks’ time. I put together a media briefing detailing the nature of the radio show, the background of the interviewer and any recent news on the subject under discussion. Hopefully now the client can relax and let their expertise do the talking.

1pm: Lunch! There’s a huge selection of supermarkets, coffee shops and restaurants nearby. Equally, if bringing lunch from home is more your thing, there’s plenty of fridge and cupboard space in the office kitchen. The Espresso machine is a lifesaver.

2pm: Time to stretch those social media muscles. I peruse what’s trending and find that it is World Water Week – perfect! It’s topical and relevant to our Twitter followers, so I get posting.

3:30pm: I make a quick trip to the bank and the post office, which are both within a 5 minute walk of the office. With a little bit of sunshine and fresh air under my belt, I head back to check my emails and see what tasks are in store for the rest of the afternoon.

4:00pm: I’ve been briefed on two research tasks. One involves acquiring figures for newspaper circulation, the other assessing a company’s annual sales figures in relation to its published targets. A combination of Google News, company websites and the online services Gong is (thankfully) subscribed to, allows me to locate everything I need.

5:00pm: I get the chance to write some digital copy for a client’s news page, detailing a recent acquisition that will double its company size. My draft is sent off to be read by another member of the team, before being uploaded to the website. I reward myself with a hot chocolate.

6:00pm: Time to head home after a busy day.

I would recommend applying for an internship at Gong Communications, whether you are fixed on a career in PR, considering work in a related field such as marketing or journalism, or just want to get some valuable work experience in a fast-paced, supportive environment. So what are you waiting for? Send your CV and a covering letter to Stephanie@gongcomms.wpengine.com

Jack Pusey interned with Gong after completing his MA in English Literature at The University of Warwick.