Michael Campion: Next we tackle product architecture and the need to design our product range in such a way that it encourages a serial and episodic relationship with the consumer, so that people buy more over time and go from core products to non-core products.

Bob Sheard: So, with product architecture, when we're designing our product architecture, it's really important now more than ever, because now more than ever, more sales come from online, they come from your phone or they come from your tablet, and that means often the product architecture, by proxy, becomes the navigational tool to find the product you want to find. So one of the reasons why, arguably, Netflix is more successful than other streamers is the product architecture. It's easier to find what you want to find on Netflix than other places. So when we're designing our product architecture, we need to do a couple of things. We need to try and design it so it will encourage a serial and episodic relationship with the consumer. So it is serial in terms of going from core products to non-core products, meaning that we'll make more money off the same consumer. But it's episodic, meaning that we'll continue to do that over time. And what we must do is we must engineer into our product architecture those products that are image drivers and those products that are volume bringers.

So, for example, Air Jordan in red, white and black at a hundred and fifty dollars would be an image driver. A Air Force One that would be a hundred dollars in red, white and black would be a volume bringer. So it's the Jordan, that's the image driver, that's in all the advertising. It gets all the noise but actually the volume comes from Air Force One or something like that. So basically, designing your brand so that twenty percent of the brand product architecture is image drivers and eighty percent of volume bringers, and then designing them in such a way that you will create a relationship between core and non-core, and deliver an episodic and serial relationship, means that you know, in sports brands it's relatively easy because their product architecture becomes a function of end use. So this is the tennis collection, this is the golf collection, this is the soccer collection. Where it gets slightly more difficult is in architectures outside sports.

So, for example, with the Levi's product architecture it's very much based on time, it's based on what was strong in the past. So Levi's vintage, what's strong in the future? Levi's made. What's strong now? Levi's red tab. So you've got sort of past, present and future. But as you move into more fashion areas then it becomes slightly more problematic in terms of what do we, y ou know, where's the truth of our brand and how do we base our product architecture on it? Do we just do it purely by product type? So we Burberry and you go into outerwear and then you go into casual wear and or how do we do it? So it's very important and you can do any number of ways. You can base it around product type. You can base it around consumer type. You can create a matrix architecture. So, Dr Martens, we looked at six consumer types. So provenance, people that were into vintage stuff. Design people who are into design stuff. Culture people belong to a cultural tribe. Value people just wanting good value. So cost conscious. Quality people wanted the best quality. And then fashion people wanted the latest trends. So we had six consumer groups and then that, if you like, represented the Y axis and then we built an X axis, based on the types of products, so the 1460, the desert boot, the 1461. So you then then decline it through a kind of a matrix. But very important simple lessons are: build it off image drivers at 20%, 80% volume bringers and try and build your lead with your core. But make sure there is a visual language and an nomenclature language that feeds into noncore as well. That can be replicatable over seasons and time, because then you'll create a much more economically optimized product architecture. And then do a pressure test. Pressure test it against navigation someone trying to navigate through your product line on their phone.

Michael Campion: What are some of the common mistakes you see with brands who have created a one off hit, a sneaker or something and then they failed to, they failed to capitalize on that. You see so many one hit wonders. Where do you think it kind of goes wrong there when it comes to product architecture and failing to develop a serial and episodic relationship with their consumers?

Bob Sheard: And I think that when you look at a brand like Hunter that has a very strong product called product but the Wellington boot, I think where Hunter may have struggled a little bit is understanding how to create a product architecture around the Wellington boot that takes them from that core product, which is very time-sensitive, weather-sensitive, and into non-core products that enables them to make sales for the rest of the year. And I'm not sure they've absolutely figured that out yet. One brand that I think has figured that out and done an exceptional job is Lacoste, where Lacoste was all about the polo tennis shirt, but they successfully managed to migrate the very classic style lines into footwear, so that footwear now is huge I mean enormous, but I think I was told over a billion in sales. So you know, you can see how their ability to translate that core proposition beyond that and into non-core is economically very important, and being able to do that through a very clear product architecture and product styling is critical.

There is a very powerful parable which is CAA, Creative Artists Agency was run by a guy called Michael Ovitz, or he was one of the principals and he realized as he worked as a talent agency scout in Hollywood, he spent three years in the post-room at William Morris and his job was basically to cycle around Hollywood delivering scripts to actors, actresses, producers, directors, musicians, and the prevailing conventional wisdom was that all the power resided with the talent. But he realized actually the consistent thing he was doing was riding around delivering scripts and actually the power was in the script. And so very early on in his career he was able to get hold of a then unknown script writer who wrote a then unknown script and he packaged around it. So what he did is he realized this was a powerful script and he got a very strong actor, a lead actor who was famous and around him packaged as then unknown actors. So the lead actor he got was Marlon Brando. He then packaged around it unknown actors at the time Robert Duvall, Al Pacino, James Caan and then got a brilliant score writer to write a great piece of music. And then he got a then pretty untested director, Francis Ford Coppola, and of course the script was the Godfather. And rather than take the component parts to the studios, he took the whole thing. So he took the whole package, packaged everything around the script and he sold it for about over a million dollars to the studios and then went back to the then writer and said look, I can pay you 250,000 or whatever it was, but start writing the next one. So he created an episodic relationship with an understanding that the product architecture for him, the power was the script. So what's really critical in any brand is to understand in your product what's your script, what's the script around which you can package other things, because then you can cross, sell and upsell and I think when you do that it's easy to sell many things once than one thing many times.