An Interview with Ty Montague

Ty Montague, CEO Co: Collective & author of "True Story"
Ty Montague, CEO Co: Collective & author of “True Story”

Before launching CO:collective with partners Rosemarie Ryan, Neil Parker and Richard Schatzberger, Ty Montague was Co-President, CCO of JWT NA, helped launch and build the NY office of BBH, and ran the NY office of W+K. But perhaps most impressive of all, he grew up with both Marc Maron and Mike Judge.

Ty has been named one of the 50 Most Influential Creatives of the Past 20 Years, one of the Top 10 Creative Directors in America, and one of the Top Ten Creative Minds in Business. Recently he used that creative mind to discuss his book True Story (which we reviewed here), and the implications of StoryDoing.

how?

Agency Review:
What was it that led you to the insight about stories, and StoryDoing? Was this an idea that you’d suspected all along was true in the back of your mind and eventually accumulated enough evidence for? Or was there a lightbulb moment that rejiggered everything you thought about marketing? Or was it simpler than all that – perhaps you’ve always thought this way about marketing, and you just finally got around to writing it down for the rest of us?

Montague:
The idea that story matters in marketing is not new. The idea that authenticity (walking the talk) matters in marketing is not new either. In my 20+ career in advertising I (and many others) in the industry tried to help clients put those ideas into practice every day. The new idea, for me at least, is that if you organize a company around a special kind of story (I call it a Quest) and put that Quest right at the center of the business, advertising itself becomes unnecessary. As I began to see real evidence in the world that this was true, it became clear to me that something new was happening in business. I began to try to understand the differences between, say, Starbucks and McDonald’s: both have thousands of stores, but only one of them spends a huge amount on advertising. Or the difference between Redbull and Mountain Dew: both are based on an extreme sports ethos, but only one of them advertises heavily. Or the difference between Method and Lysol: both make a variety of cleaning products, but one advertises and the other does not. Ultimately this caused me to decide to leave the advertising business 4 years ago and enter a new business.

Agency Review:
Okay, but where does that come from? You talk about seeing Starbucks and McDonalds, Red Bull and Mountain Dew – but lots of us see those brands every day – what made the light bulb go on for you?

Montague:
It actually first happened back in the mid 1990’s. I remember noticing that seemingly overnight there was a Starbucks on almost every street corner in America. And since I was very much in the advertising business at the time, it also occurred to me that I almost never saw Starbucks advertising. That made me curious. I didn’t do anything about it at the time. I tucked the curiosity away for further investigation. Later, as the internet really got traction I started to notice other companies that seemed to share this difference… Amazon was another early example. During the first big web bubble around 2000, some web startups were famously spending up to 300 million in venture money to “build a brand”. Amazon, instead, just hammered away at innovation in the customer experience. They experimented with advertising occasionally, but it never seemed like a natural act for them. Then I read an article in which Bezos was quoted as saying “Advertising is just a tax that companies pay for lack of innovation.” That really hit home and it made me want to really understand how these new companies worked. Flash forward to 2009, at JWT. My partner Rosemarie and I felt that we finally really understood what makes these non-advertising or low-advertising companies tick. So we made the leap out of advertising to start an innovation company that helps clients operate in this new way.

Agency Review:
So this was an idea that occurred to you while you were at JWT? Why not reconfigure that estimable shop with this insight?

Montague:
We discussed that possibility. Ultimately our decision to leave came down to three things. First, there is the strategic role that JWT plays inside WPP. We concluded that, though it might be possible to reconfigure JWT, it would only really have any chance of success if we had the authority to make whatever changes we believed were necessary – something that only owners could really do. We weren’t the owners, obviously, and the owners had other plans for JWT. Which is perfectly fair and fine. There is still a lot of money to be made in the advertising business. Second, what we are doing ultimately is pretty different than what JWT does. It would have been a heavy lift even with full autonomy, to change the business model of a company the size of JWT. Third, probably more importantly, we had no idea at the time if this would work. So it felt a little irresponsible to try to change the entire organization based on an untested theory. So we decided that the right thing to do was to leave JWT and start our own business devoted entirely to helping clients do business in this new way.

We also wanted to find ways to share what we were learning as we developed our process, and so that led to the idea of writing a book. The discipline of having to write stuff down and the resulting need for a quick handle to convey the central idea of the book is what led to the term StoryDoing (circle c).

Agency Review:
Lawyers, please take note of the copyright…

not the tail of the dog

Agency Review:
One of the most revolutionary aspects of True Story is that because you’re making story the product/brand itself (as opposed to just the expression of the product/brand to the consumer), you move marketing generally (which is usually seen as simply the expression of story in one form) up much earlier in the whole brand/product process. The repercussions of that – in terms of agency process, client process, agency/client relationship, sales and marketing relationship, everything – is, well, revolutionary. Do clients realize that’s part of what they’re signing up for, and if not, since it seems to be an intrinsic part of how “story-doing” works, how do you get them to understand it and make it happen?

Montague:
It’s true that what we are asking clients to do is new. The business we are in is creating innovations in the customer experience (products, services, business models) that also function as marketing. And the honest answer is it’s a work in progress. We try to be very clear in our initial contact with clients that we are not an advertising agency. We are a strategy and innovation company. If advertising is what they are certain they want, we are very happy to refer them to some of our very talented friends in the advertising business. Our aspiration is to work with companies before they have decided that advertising is the answer — to work with the whole leadership team of the company to develop their Quest, and then develop the Iconic Innovations that flow from that Quest. It is action, not communication that make any story real and inspiring in the world.

Agency Review:
Okay, but hold on; clients are businesses with line items for manufacturing, health care, advertising, etc – and NOT for “StoryDoing”. And since most are not awash in money – or at least, aren’t willing to let you know they’re awash in money – how do you get in the door with something they don’t even know they need?

Montague:
A very important question we ask our clients in the initial meeting is “How does your company fund innovation?” The answer often reveals budgets that are earmarked for innovation in the customer experience (new products, new services, new business models). In some companies these funds come from R&D, but increasingly companies are realizing that they need to think more holistically about how they fund innovation. Companies that think this way are more open to working with us.

We also try not to be arrogant or inflexible. Truth is, many companies aren’t structured internally for this kind of holistic approach. Many are still a collection of discreet silos, all with their own egos, prejudices, and budgets. It takes real openness to innovation and business transformation to engage fully in our process. For that reason it works best if we are brought in by a CEO. We have had many successful engagements with CMOs as well — it really boils down to how a company defines marketing, which ultimately boils down to culture.

Agency Review:
Completely agree, but one of the biggest challenges facing companies is the abyss between the vision of the CMOs and the quarterly sales numbers that the bonuses of the brand managers in the trenches are based on. How do you – and more importantly, how does StoryDoing – bridge that gap?

Montague:
This is why the best engagements for us are with the CEO. And it is why, no matter who brings us in, we insist on engaging with the whole leadership team on the business. In really big companies this can also be defined as the leadership team of an individual business unit. We need to work with the team of people who have responsibility for a P&L. We have learned through hard experience that if we don’t work this way, we don’t succeed.

danger

Agency Review:
It would seem to me that one of the challenges of writing a book like this is that you run the risk of giving away the store. LeBron can tell us how he crashes the lane, or Messi can tell us how he does a no-look pass, but clients pay us for the way we think – or even, think different. Aren’t you concerned that a book that outlines how you – and by extension CO:collective – “think different” does two dangerous things: 1) it tells clients how to do what you do (so they don’t have to hire you to do it for them), and 2) tells the competition how to do it as well?

Montague:
Yes it was probably a terrible idea. Too late now : ).

Agency Review:
Nice try, sunshine, but you don’t get off that easily. Because this is really a question about scalability. Is StoryDoing primarily something that only you and your crew of merry pranksters can do, or is it, to quote a famous pair of British marketing geniuses “a new phenomenon, an early clue to the new direction”?

Montague:
I hope lots of people can begin to use what we have learned to make their businesses better. And you make a great point — we are really focused on scalability at this point and trying to figure out how to help clients create persistent cultures of collaboration and innovation long after we have left the scene. Part of that involves exploring ways to move co:collective from being a service business to a product and service business. That’s a story for another day.

conversion

Agency Review:
Late in the book you talk about data being important but that “it will only get you so far. Stories lie in the hearts of human beings.” And yet, as you also point out, CEOs have trouble understanding this “right brain” way of thinking – because they’re literally not taught to think this way. So, how do you convince them of the value and power of story – in terms they can embrace and – more importantly in the business world – defend?

Montague:
There is an old saw in business that if you’re talking to the CMO talk about ideas. And if you’re talking to the CEO talk about money. At CO: we talk about both. It is an assumption going in to an assignment that teams will need to model the business implications of any recommendation they make. Which is why we define a team differently here. We want people who can dream big on the innovation front working hand in glove with people who can deliver hard-core quant business cases. It may seem like strange thing to say but culturally we are also pretty enthusiastic about proving ourselves wrong. We bring that attitude to our own ideas, so by the time they get to our clients they’ve been through a pretty good kicking. For example, one of the hypotheses we formed while writing the book is that StoryDoing companies are more efficient businesses. It seemed logical to us that there should be a tangible, measurable business benefit to reducing paid media spend. But we wanted proof, so we commissioned our own study of 42 different publicly traded companies in 7 commercial categories, pitting storytellers against StoryDoers. The first round of results were published here: www.storydoing.com. We recently completed the second round of data crunching. Spoiler alert: StoryDoers still winning. Which is all a long way of saying that we put a high value on measurement of the business value of what we do.

Agency Review:
Measurement is terrific and there’s no one who will dispute it – in theory. But in the hard light of the bottom line, most companies – whether they be agencies or clients – don’t have a stomach for “proving themselves wrong”. They want the fastest, cheapest idea possible. So again, how do you convince companies that what you’re selling is better on this fundamental level (recognizing also that your recent data crunching – as estimable and impressive as it is, comes with a certain legitimacy caveat – because what company is gonna publish a report that destroys their own reason for being?)

Montague:
I agree that most companies don’t have the stomach for trying new things, even today. The good news for us is we don’t need to work with most companies. We have built our business working with a handful of companies that want to try a new (and we believe) better way. We believe that the number of companies that will want to try something new is growing not shrinking. So we’re cautiously optimistic about our future. Companies that look around at the world today and conclude that “steady as she goes” is going to be the winning strategy probably won’t be calling us anytime soon. And that’s okay.

real value

Agency Review:
We’ve reviewed a lot of books about the business of advertising and marketing. And again and again we find they often boil down to the same basic things – who are you talking to?, what do you want them to do?, why aren’t they doing it?, why should they care about what you want them to do? Over and over, these simple questions. And yet, we also see, again and again, how marketers – both clients and agencies – absolutely fail to answer them. Or to act on them. And as revolutionary as we’ve said we think your book is, these questions are at the core here too. So, is StoryDoing’s real value that it provides a process for answering these questions that is understandable by most marketers in a way that other processes have clearly proven they are not?

Montague:
I think that one of the aspects of True Story that is often overlooked is that at its heart it is an argument for radical business transformation. StoryDoers don’t just behave differently than storytellers. StoryDoers are structured and processed differently than storytellers. The business structures and processes inside most large corporations today are the result of easy access to large commercial audiences through one-way push media. That access is being squeezed off. New internal structures and processes are needed to address the issue. Hiring a social media agency might check a box in the short term, but is not going to help you win long term. Real internal transformation is the only way that the great old storytelling companies of yore have any hope of survival in the future.

Agency Review:
Interesting idea, “storytelling companies of yore” – like who?

Montague:
Name a big TV advertiser and 9 times out of 10 I will show you a “storytelling company of yore”. Proctor and Gamble. Budweiser. Coca Cola. McDonalds. These companies grew up in the era of mass media and mass audiences. They are processed and structured internally to tell their story using advertising. McDonalds tells us a story about “lovin it”. But the steady quarter on quarter decline of that business and the recent departure of the CEO is clear evidence that people aren’t actually “lovin it” as much anymore. Undoubtedly McDonalds will hold an agency review and try to solve the problem the same old way. But that will fail. What is needed at McDonalds is not a new ad campaign. What is needed is a radical transformation of their business. Its a product and process problem, not a communications problem. Put another way, no matter what happy story McDonalds tells in their advertising, the story that customers experience from the product itself (the food and the physical stores) is out of step with what they really want today — which is increasingly to do business with a Quest driven company like Chipotle, instead. How much Chipotle advertising do you see out in the world? Hmmm. What this means is that the days of “story” being the sole domain of the marketing department are drawing to a close. It is also the end of the era where innovation is the sole domain of R&D. In the best run companies today and in the companies that we believe will dominate the future, both story and innovation are the domain of the entire leadership team, up to and including the CEO.

That’s why we created co and why we wrote True Story. I hope there is some value in providing a “from the trenches” view of a handful of companies that are grappling with this need to transform, and I hope that by providing a framework and a process we help a few more companies begin that journey. Change is hard. It is scary and sometimes dangerous work. I hope that the book helps make it a little less dangerous and a little less scary.

Agency Review:
Because it’s so scary and dangerous – and frankly so radical and revolutionary – are you finding 1) that certain industries are more amenable/receptive to it, and/or 2) that you and CO: are awash in start-ups who have not yet built the silos you’re trying to transcend?

Montague:
We aren’t finding any particular industries that are more amenable. We work in technology and retail and healthcare and banking and automotive. We work with cultural institutions. I would say I do sometimes sense a regional bias. Companies on the west coast have been more open to trying something new, in general. But we work with some great companies on the east coast as well. In terms of size it is very true that smaller and mid-sized companies can be easier to work with mostly because its easier to get everybody on the same page. But we work with companies of all sizes from startups to global colossi.

future

Agency Review:
Where does StoryDoing go from here? Is it constantly refined and reinterpreted as it adapts to newer and increasingly exotic forms of media? Or is it in a constant state of testing – you’re always trying to see what is “story-able” and what isn’t? Or is there a “StoryDoing 2.0” and what does that look like? Or maybe there’s another path. Maybe you’re just planning on kicking back and letting the franchising checks to roll in? So what’s next?

Montague:
Haven’t seen any franchising checks so far. That sounds fantastic. Put me in touch with anyone who wants to write one.

Agency Review:
I’ll pass your book on to the folks at Franchise Times – if they can’t do it, no one can (full disclosure: I get 15% off the top if it works…)

Montague:
Deal. In the mean-time we continue to work on our process and our team. We updated our process in one substantial way recently. We found that, like any good story, it gets even better when the protagonist has a really great enemy to fight. So we now spend time helping clients get very clear not only about their Quest (the big positive change they want to see in the world) but also their enemy – it could be a commercial competitor but also could be an idea or an emotion.

Agency Review:
Why is that? Do you think it’s because an enemy focuses attention on something that’s concrete and not abstract? And what new challenges does having an “enemy” generate for StoryDoing?

Montague
Having a great enemy is just fundamental to any great story – think of any story you really love (any book, movie, play… whatever). They all have certain elements: an appealing protagonist who is on an inspiring quest who faces a great enemy or obstacle. A key element to a great story is a really scary, sinister or clever enemy. How the protagonist grapples with and eventually defeats that enemy is the essence of the story. True of human stories. Also true of company stories. It is incredibly clarifying and energizing for people in any company to know who or what they are fighting against — the Smaug they set out to slay every morning.

Agency Review:
Let’s take that a step further, then. Should every agency have an enemy? Or should every agency should be built upon a distinct and preferably proprietary approach as CO: is with StoryDoing? Do you think every agency is, whether they know it or not?

Montague:
A little hard for me to comment on what agencies should do. CO: isn’t an agency. I know that’s a fashionable thing to say these days, but we really aren’t. We don’t compete with ad agencies or digital agencies (or social media agencies, et al) for new business. In fact we have been a source of new business for several agencies. It comes back to your earlier question about funding: we seek funding from the innovation budget, which takes many different forms inside different companies today. Sometimes marketing dollars pay for a portion of us. Sometimes they don’t. That makes us a little hard to categorize. Our competitive set ranges from management consultancies to innovation companies with the occasional branding strategy firm thrown in. We often (and happily) partner with agencies when necessary. Whatever it takes to get innovative ideas into the world. Which is why the unofficial co motto is “Wage Peace”.

You can read our review of Ty’s book here, or order it from Amazon here or from Barnes & Noble here – or pick it up at your local bookseller (find one here).

Illustration of Ty Montague by the brilliant Mike Caplanis

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