Nationwide: the feeling is mutual

The slide below is one I use frequently as part of the mix to illustrate the essential differences between old-world CSR and new-world sustainability.

Looking in particular at the ‘stockholder vs. stakeholder’ view, businesses structured as partnerships or mutuals are often the best examples of this – owned, as they are, by their employees or customers, rather than conventional investors.

While I’m sure there must be many queuing up to pour scorn on the value of these models in the wake of the Co-op Bank’s recent difficulties, results published today by the UK’s largest building society, Nationwide, tell a rather different story. (It’s worth pointing out, by the way that the Co-op Bank wasn’t actually a mutual at the time it ran into difficulties; rather it was, and is, a PLC whose air of mutually is conferred on it by Co-op Group ownership.)

For anyone who doubts the commercial rewards that can be gleaned when you look beyond the received orthodoxy of maximizing shareholder value, check out these numbers:

• Underlying half-year profits up 155% from £130m to £332m
• Deposit balances up £5.4bn, a quarter of all such new saving in the UK
• The rate of new current accounts being opened up 16%

Much of that momentum, I’m certain, comes from the Nationwide’s (increasingly rare) mutual status and the message implicit within – i.e. that their business is designed from the ground up to put customers’ interests first; that they actually give a crap about their lives and their dreams. Even more importantly, it comes from that rather intangible ethos being reflected in very tangible business decisions – like, for example, Nationwide having provided more than a fifth of all mortgages to first-time house buyers in this most recent six-month period.

I doubt it’s too grandiose to suggest that Nationwide doesn’t see itself in the business of lending money. It’s in the business of helping people to realise their ambitions – in this case to start a new life together with a partner, maybe to raise a family, in a place they can call their own. The dosh is but a means to a higher end.

In response, it would seem customers are deserting high street banking rivals to join Nationwide in their droves! And that, perhaps, leads to the most striking comparison of all when you think back to the financial crisis.

Unlike Northern Rock, for example, which went nuts lending more than homebuyers could afford pay – and with predictable consequences – Nationwide’s average loan to value (LTV) ratio on these new mortgages is only 69%, and only 49% on its existing stock. What’s more, its net mortgage lending is virtually identical to the increase in its net savings.

To put it another way, its books are well and truly balanced.

Hate to admit it, but I’m loving The Voice

Normally you’d have to handcuff me to the chair to make me watch a talent show. X Factor, Britain’s Got Talent and all that other guff has always left me stone cold, padded out as they are with all that Harry Hardluck/Sally Sobstory heartstring-pulling, every song being pro-tooled to within an inch of it’s life, and the basic premise seemingly more to do with laughing at the loonies than actually finding anyone with said X factor/talent.

However, The Voice on BBC1 has got me totally hooked – at least for the moment.

The lustre may soon wear off now that we’re into a more run-of-the-mill live show format, but the earlier ‘blind’ auditions, and last week’s battle rounds, were great entertainment. They were also a couple of very interesting and innovative tweaks to help differentiate the show from its more garden-variety competition, and to reinforce the show’s brand as being all about discovering great new voices.

Nowhere was this better demonstrated than by the battle round last week between David Julien and John James Newman. OK, so their cause was helped by the fact that they were belting out a track from one of my favourite bands – Dakota by the Stereophonics – rather than some naff RnB number, but it was still bloody good by any standard…

XXX

Sausage + Sizzle (the Icebreaker way)

WARNING: LONG (BUT HOPEFULLY ENLIGHTENING) POST

Let’s start at the beginning…

The plan was simple: let’s be what the others weren’t. They were synthetic; we were natural. They were about sweaty men; we were gender inclusive… They were about hard adventure; we were about kinship with nature. They were about function only; we were about design and creativity. Exploring for us wasn’t the highest peak, but an exploration of something much bigger – nature itself.

These words from CEO, Jeremy Moon, brilliantly capture the essence of Icebreaker – the New Zealand outdoor clothing brand, whose nature-inspired, pure merino wool outdoor clothing system is another fabulous example of brand- and sustainability-driven business strategy.

My blossoming love affair with the brand only intensified last weekend as I popped into Snow+Rock to buy my four-year-old daughter a new set of thermals. For me, it was an encounter that added yet another layer (no pun intended) to their brilliance – a perfect combination of sausage and sizzle…

First the sausage…

Emotional ‘sizzle’ is for nought without product ‘sausage’, and product performance is where the Icebreaker system really scores, thanks to taking its cue from Mother Nature.

The merino wool fibre, it turns out, is a miraculous thing – not only providing outstanding insulation, but also incredible softness and breathability. And because of its natural antimicrobial properties, it doesn’t stink either, even after a sweaty run.

By all accounts there are folks who’ve been able to go for months without having to wash their Icebreaker, so brilliantly does it work (not something you can say about the synthetic competition); and, when you do eventually wash it, you can do so on a perfectly ordinary washing cycle (no need for special detergents to get the whiff out).

Feels better. Warms better. Breathes better. Smells better. That’s a clear victory for natural merino wool on product performance, and what was really great to see at the weekend was how the whole Icebreaker value proposition was reflected in the packaging of Lottie’s new gear as well…

Compact and 100% recyclable

Firstly, you’re immediately struck by just how compact it is, and the fact that the inner tray and outer sleeve are both made out of nothing but 100% recyclable cardboard. Look a bit closer, though, and you realise they’ve done something else really clever…

'The Pack with the Hole'

Notice the hole on the front of the outer sleeve (one that on other packages might have been covered by a bit of clear plastic)? That’s genius because it immediately allows you to touch the product inside. ‘Wow, that’s soft!’ you say, and all those messages about superior product performance encircling the cut-out are given an extra kinaesthetic kick.

…then the sizzle…

There’s no shortage of emotional sizzle either, with some wonderfully irreverent copywriting on the back of the box (a bit reminiscent of the kind of copy that appears on Innocent’s smoothie cartons):

The New Zealand merino sheep’s amazing all-weather coat lets him roam the rugged Southern Alps in snow, rain, sun and wind. Now you can wear the same outdoor clothing system – minus the horns, hooves and dags (that’s New Zealanders’ word for sheep poo!). Your Icebreaker doesn’t itch, feels light against your skin, looks great and locks in warmth – and it’s good for the environment. Your Icebreaker rocks!

Accompanied by mini-testimonials (including from 8-year-old, Alex, who says that, if his mum wants to wash his Icrebreaker, she basically has to steal it from his room under cover of darkness!), this helps to create sense of fun, playfulness and love for the brand that amplifies, still further, the contrast between the ‘soft’ Icebreaker and its ‘hard’ competitors.

There’s another lovely little touch, too, with the finger puppets stamped into the cardboard of the inner tray (hours of fun, no doubt, for the younger wearer.)

The piece-de-resistance here, though, is undoubtedly Icebreaker’s pun-tastic invention of the ‘Baacode’ – a unique number on the clothing label that, if you enter it on their website, actually traces the sheep stations from which the fibres that make up your garment were sourced. Complete with extensive bios of the farmers concerned, it’s a great way for Icebreaker to illustrate its commitment, not only to its suppliers, but also to full product transparency.

Tracing your garment

Where the fibres came from

Personal stories from the sheep stations

In conclusion…

Ultimately, I guess, this is all a rather long-winded and effusive way to express my admiration for a not inconsiderable amount of integrative thinking; also, though, to illustrate an important point from a previous post…

Actions taken in the name of sustainability are liable to be worthless – indeed can be positively harmful to a company’s brand and the bottom line – if the underlying principles aren’t demonstrably applied to day-to-day decision-making (i.e. sustainability ain’t about PR; it’s about culture!)… The authenticity of your commitment stems from the materiality of your actions – i.e. beyond the thin veneer of charitable giving, cause-related marketing etc., that commitment should be self-evident in the very products and services you provide.

In case you were wondering what that might look like in real life, I reckon the above offers a pretty decent example.

Could Jeremy Moon be the new Ray Anderson?

Blog posts from me, it would appear, are like London buses – none for ages and then two come along at once!

Having mentioned the utterly brilliant outdoor clothing company, Icebreaker, in a couple of posts – and figuring there are probably still a lot of folks out there who know little or nothing about them – I thought it might be worth sharing this TV interview with company founder, Jeremy Moon.

Icebreaker, for me, is rapidly becoming the new Interface – another living, breathing example of how companies can do extraordinarily well by putting sustainability at the heart of business.

Witness the extent to which Icebreaker has managed to completely buck the downward trend in retail – a company that started in a guy’s bedroom 15 years ago in New Zealand now turning over $120 million, with a presence in over 3,000 outlets in 37 countries, and set to re-double in size over the next few years.

Witness, too, Jeremy’s emphasis on a singular clarity of purpose and his exquisitely simple treatise on the powerful combination of differentiation and meaning that his biomimetic, merino-wool product delivers – one that commands a premium price not on the basis of its sustainable credentials alone, but because those credentials actually translate into a superior product that outperforms its less sustainable, synthetic alternatives (rather like Puma’s clever little bag I posted about a few months back).

And what wonderfully modest, natural and authentic delivery too!

All-in-all a thoroughly impressive and switched-on bloke…

If I was going there, I wouldn’t be starting from here

One of the agencies I work for occasionally as a freelancer essentially employs me as a copywriter. It pays well for what it is, and it’s good to flex my linguistic muscles now and again to keep that side of my game sharp.

At the same time, though, it can throw into sharp relief the limited ability to create value for a client if your mindset as a communicator is limited to downstream tactical execution – of simply tarting up a fait accompli.

A case in point yesterday…

I was asked to review a document a client had produced, with the aim of accentuating its key points of differentiation from competitors, each point with a set of messages tailored to each of its key stakeholder groups – employees, consumers, clients and suppliers.

Quite apart from specific issues of tone and language, my immediate gut reaction was to question the whole premise of the piece – whether the six points of differentiation highlighted by the client were even relevant in the first place.

Why? Because the client was pushing what it felt to be relevant, with no apparent thought given to what its audiences might actually value. That’s an approach that’s fundamentally flawed in my book and, by definition, incapable of delivering the same impact as one driven by audience insight (NB Marty Neumeier’s line about a brand being what they say it is, not you).

And so to what I suppose is the point at the heart of this post…

When I raised these issues with the agency, who had pencilled in two days of writing for the job, their initial response was, “So what are you saying, Dan? Do you want to do this or not?”

My answer? If all the client really wants is two days of writing to finesse their existing approach, then I’ll happily do that. But…

As professional advisors, don’t we have a duty to raise questions first, to challenge assumptions, and to highlight the possibilities of other (potentially better) approaches?

Surely they’ll appreciate that and, if they agree, we’ll work together to scope something different. If, on the other hand, we have that conversation and their views don’t change, then that’s fine too – at least they’ll have made a more informed decision.

(A call with the client was duly scheduled for next week.)