Tag: Forrester Research

BEYOND ADVERTISING-3

This is the last part of the ” Beyond Advertising ” trilogy. The previous two can be accessed @

https://www.khaleejtimes.com/business-technology-review/beyond-advertising

https://www.khaleejtimes.com/business-technology-review/beyond-advertising-2

A Compelling Picture: Our Intended Audience of The Present | Future

As Alicia prepares for bed, she surveys her apartment. She is very conscious of what she buys and why. She buys things with meaning. While she sees less traditional advertising than she used to, she is more engaged with the ads she views. She can connect her purchases to strong creative content created by brands or co-created by brand fans. Though she is exposed to a lot of targeted ads, she feels she is in control of what content she sees. She accepts new brands warily and rarely with a direct entreaty from the advertiser. Instead, she relies on peers and trusted sources for her introductions. She wants brands to challenge her, understand her, inspire her through their content. She seeks stories that move her, excite her, delight her.

Given this scenario, all brands should be asking ” How can we engage Alicia and others like her today?”. When consumers have endless choices of content and screens, plus endless access to information and insights, why should they stop to listen to your message? For every technology designed to interrupt a media experience or a search for information, people will find a way to block, skip or ignore it. And if the interruption is egregious, be prepared to hear it from empowered customers.

Geography is History

I believe that great brands are ” business strategy brought to life “, and deliver a seamless experience across product and service, physical spaces and places, internal culture and communications. Brands like Apple have already set customer expectations and it doesn’t matter if you are a bank, a business consultancy, a retailer or a hotel chain, the message is simple: join up!

A continued focus on a narrow notion of what is currently within the purview of advertising and marketing will threaten the life of a brand and the organisation. Brands are expected to provide the seamless experience that people are taught to expect by each day’s new technology-enabled and insight inspired pace setters. Even the notion of ‘ omnichannel ‘, which is currently limited more to the realm of retail, will work within a larger ecosystem as retail and advertising undergo a fusion.

Divergence to Convergence

In order to reach, serve and stay connected with people in comprehensive, effective ways, advertising’s scope must go beyond its traditional reach to encompass the entire firm. The boundaries between external and internal touchpoints are blurring and will continue to do so. In a convergent world, no person or no touchpoint exists in isolation. Everything is interconnected and interdependent.

Consider the many different ways we now encounter brands on a daily basis- tv, radio, print, online searches, mobile apps, websites, billboards, DOOH ads, branded social media posts, offline and online conversations, personal interactions, web browsing, store design and displays, package design and packaging, conversations with salespeople, in-store promotions. All this is just the ‘ before purchase ‘ exposure followed by interactions with customer service, online help features, surveys, loyalty programs, etc. ‘ post purchase ‘. It is less common for people to encounter advertising head-on. Conversations have become the pathways by which people encounter advertising. 

Something to RAVE(S) about

Most people today think of advertising as an interruption, a distraction, a nuisance, a waste of time. If we could skip or ignore it all, we would. And the lack of creativity is certainly not helping. Advertising as an interruptive act should be gone. Period. As I have been advocating, ” beyond advertising ” could and should be a narrative content that is entertaining, informative, actionable, valuable, value generating and provides an exceptional experience, being a shareworthy story delivered through all touchpoints. It could and should be something to RAVE(S)about:

R: Relevant and Respectful (to Individuals and of Individuals)

A: Actionable (Intuitive & Frictionless)

V: Valuable & Value Generating (Wanted, Needed, Effective)

E: Exceptional Experience (Delight & Inspire)

S: Shareworthy Story (Authentic & Authoritative)

Knock, Knock, the Digital Door

Beyond advertising could and should be something people want and seek out because it provides value. The trouble is nobody opens their digital door to receive an ad. They will, however, invite information across their threshold, if it promises to be of value to them. In the near and not so distant future, the successful advertisers would be those who have stopped treating consumers as many targets, marks, and stats. In an online universe, populated by consumers armed with the desire, the regulatory support, and the technology to be aggressively selective in the choices they make, advertisers will be obliged to treat consumers as decision makers.

Open the Vent: To Relevant

Forrester Research has termed the next few years as ” The Great Race for Relevancy “. New social data with clearer content marking will be interrogated with powerful new algorithms. The movement is from link-based to answers that are algorithmically based, where search engines are computing the right answer. We are already at a point where Google can give direct and accurate answers to questions like: What time is Guess Guess Guess on? Who plays in goal for Manchester City? Who is the favorite to win the next US Presidential election?  What black suits are on sale at Zara?…

Google’s algorithm has improved to the point where it can answer questions that are nuanced, and geo- and time-based. Is the stimulus package working for the economy? Which is Arijit Singh’s best song now? When should I leave to reach Ritz Carlton DIFC by 8 pm?

And very soon, the internet will become an intelligence that will make its current guise seem incredibly dumb and disorganised. We don’t know how we lived without it.

The goal of relevance is to reach specific individuals. General demographics and television time slots no longer cut it when trying to communicate with people who juggle multiple screens and identities (family, work, social roles). Advertisers must get to the basics: Who are you? What are you doing? Where are you? What time is it? Why are you doing it? And how?

Messages relevant to time, location and preferences can be very effective, but they are not sufficient for optimal effectiveness: mood and state of mind must also be taken into consideration, just like the human interaction ” Is this a good time to talk to you about…?”.

Digital media drove a shift in marketers’ budget to ‘ always-on ‘, such as search, display and social. The marketing on-demand world of now and the near future has evolved to be ‘ always relevant ‘. For brands and their agencies, that will require a much more sophisticated and targeted approach to address the ubiquity of touch points so that they can be there at a consumer’s point of need-no matter where or when it is. Massive analytical capabilities invested will help support a brand’s stewardship of their customers information. In short, ads need to answer questions, any time, all the time. 

Don’t find Customers for your Products; Find Products for your Customers

The only asset that gets built online is permission. Permission to talk to people who want to be talked to, delivering, and anticipating personal and relevant messages to people who want to get them and connecting them to one another. That’s all we can build and what we should measure. Not how many people thumbed up some video we made, but instead how many people want to hear from us.

Brands that want to thrive in this space must earn their welcome through the continually refreshed offer of social currency: ideas that people want to share with others.

Next STEPPS

Wharton Professor Jonah Berger in his book Contagious: Why Things Catch On, suggests six principles for developing contagious or shareable, ideas based on his research findings using the acronym STEPPS:

S: Social Currency (make it cool to talk about)

T: Triggers (make it top of mind)

E: Emotion (make them feel something)

P: Public (make it visible)

P: Practical Value (make it useful)

S: Stories (make it tell-able)

The worlds of logic and emotions must be married with all the senses and the muses from music to scents, visuals to touch, virtual to reality. Monetary value motivates consumers to purchase, but it won’t necessarily be enough to motivate them to repeat that purchase, or to recommend an object or service to peers.

Questions

What would happen if authentic and creative stories opened channels of communication with people?

How would people feel about brands and advertising?

What financial and social benefits would be afforded employees and shareholders?

How could advertising be ‘ re-defined ‘?

What if advertisers were named POY (Person of the Year) by TIME Magazine for these transformations?

What if we question the intentionality of our choices, the depth of our kindness and our very belonging as a species on this planet?

Creating RAVES advertising through every touchpoint has the potential for achieving this transformation.

Most positively, we are headed inexorably towards a new era of truth. Truth in what products do, truth in how and by who they are made, truth in the opportunity cost of their manufacturer, truth in performance and yes, truth in advertising.

ENDS

Suresh Dinakaran is the Chief Storyteller at branding agency ISD Global, Managing Editor of BrandKnew and Founder, Weeklileaks. Feedback welcome at suresh@groupisd.com

The New Prescription for Marketers: Subscription

The New Prescription for Marketers: Subscription
Saying that we are in the ” The Age of the Customer ” would be stating the obvious. Here’s how Forrester Research describes the new consumer mindset: “ The expectation that any desired information or service is available, on any appropriate device, in context, at your moment of need.” Customers have new expectations (and yes, those expectations have certainly been driven by millennials, but at this point, almost everyone shares them). They want the ride, not the car. The milk, not the cow. The new Kanye music, not the new Kanye record.
 
Welcome to the Subscription Economy. The term refers to the growing number of businesses that use subscription or membership models and rely on recurring revenues rather than one-time purchases. And aside from transportation and retail, they are entering diverse businesses including Fashion, Personal Hygiene, Furniture etc.
Apple is a subscription business with Apple Music. And so is Google with Google Express. And all the binge watchers out there know that Netflix is one. Dollar Shave Club that sends razors home every month to subscribers is one(they got acquired by Unilever for US$ 1 billion). Salesforce, Amazon, Volvo(yes cars), Adobe..the list is growing across business verticals.
 
The Begining of a New Era
 
Before anything else, let‘s talk about the flavour of the season: ‘ digital transformation ‘- a vague term definitely, the kind of smart-sounding phrase that gets thrown around a lot in conferences and McKinsey reports and Harvard Business Review articles. The kind of expression that lots of people instinctively nod their head at, whether they know what it means or not. It could mean everything, it could mean nothing. Let’s try to define what it means.
 
You have read or know about this statistic already: more than half of the companies that appeared on the Fortune 500 list in the year 2000 are now gone. Poof. Vanished off the list as a result of mergers, acquisitions, bankruptcies.The life expectancy of a Fortune 500 company in 1975 was seventy-five years- today you have fifteen years to enjoy your time on the list before it’s lights out. Why is this happening? Instead of dwelling on failure and looking at all the companies that went away, let’s look at the companies that have stayed. Let’s play victor, not victim.
 
Begining with the usual suspects: Giants like GE and IBM that were on the first list in 1955-and are still on it today-but they don’t talk about their mainframes and refrigerators and washing machines anymore. They talk about “providing digital solutions,” which is an admittedly jargony way of saying RIP Hardware . In other words, these companies now focus  on achieving outcomes for their clients, rather than just selling them equipment. GE ran commercials during the Oscars with the tagline “The digital company. That’s also an industrial company.” Notice the switch there.
 
More companies from that list of 1955 have transformed including Xerox(from manufacturing photographic paper and equipment to information services). McGraw-Hill(from printing textbooks and magazines to offering financial services and adaptive learning systems)..
 
Next on the list, let’s look at some ‘ new establishment ‘ brands like Amazon, Apple, Google, Netflix, Facebook. All very every day to us but new to the list.They’ve rocketed to the top of the list and show no signs of going anywhere. They never thought of themselves as product companies-so no transformation was needed. From the start, these companies were relentlessly focused on building direct digital relationships with their customers.
 
And, finally the third category in the list are the upstarts, the ‘ anti establishment brands ‘ like Uber, Spotify, Box: They haven’t just gone beyond selling products, they’ve invented completely new markets, new services, new business models, and new technology platforms, leaving many established companies trying to play catch-up. As consumers, we love these brands, we love these services, and we love the value they provide us-a value that goes way beyond what a single product could ever offer.
 
What are the common threads among these three groups of companies? Whether it’s GE, Amazon, or Uber, they are all succeeding because they recognised that we now live in a digital world, and in this new world, customers are different. The way people buy has changed for good. We have new expectations as consumers. We prefer outcomes over ownership. We prefer customisation, not standardisation. And we want constant improvement, not planned obsolescence. We want a new way to engage with business. We want services, not products. The one-size-fits-all approach isn’t going to cut it anymore. And to succeed in this new digital world, companies have to transform.
 
The Customer is Always Right?
 
A nineteenth century phrase that was doing the rounds. The jury is still out on that question- Fortune 500 Companies built prescriptive strategies around customer focus, but they lacked a descriptive understanding of the mindset of the customer herself. And to no one’s surprise, there were certainly no sweeping changes in public sentiment toward big enterprises. It just wasn’t enough. The winds just weren’t blowing in the right direction.
 
And then it happened- like a breath of fresh air, digital disrupters like Salesforce and Amazon took the Customer First concept several notches upstream. They began by waving goodbye to the ‘ one to many ‘ approach.(What we call in marketing as the ‘ Spray and Pray ‘ route). They didn’t have customer segments anymore- they had individual subscribers. And every one of those individual subscribers had their own home page, their own activity history, their own red flags, their own algorithmically derived suggestions, their own unique experiences. And thanks to subscriber IDs, all the boring transactional point-of-sale processes disappeared. Ten years ago there was no Spotify, and Netflix was a DVD company. Today both those brands own a significant percentage of the total revenue of their respective industries! Now businesses are asking themselves a whole new set of questions: What do we need to do to build long-term relationships? What do we need to do to focus on outcomes and not ownership? To invent new business models? To grow recurring revenue, and to deliver ongoing value?
 
The New Marketing Mix
 
We are seeing a massive shift from the 4Ps( Peace Be Upon It) towards the 4Es: the new approach to customer value proposition, which embodies Engagement, Experience, Exclusivity and Emotion. The the truth is people don’t buy products anymore. They buy experiences and emotions instead. You should change your “what should I sell” or “how should I sell” into “WHY should I sell it?”.
 
The glory days of the soulless, all-powerful corporation are long gone. Today’s customers are more informed by an order of magnitude. Most of them have researched, assessed, and categorised you before you can even say hello. And to most of them, especially younger ones, ownership just isn’t that important anymore. People increasingly view the prospect of buying something as unnecessary baggage. Today people expect services to provide immediate, ongoing fulfilment, from ride shares to streaming services to subscription boxes. They want to be happily surprised on a regular basis. And if you don’t meet those expectations, you get dropped, not to mention trashed on social media. It’s that simple.
The Shift is On
 
So, on the one hand you have the old business model, where brands used to focus on “getting a product to market” and selling as many units of that product as possible: more cars, more pens, more razors, more lipsticks, more laptops, more credit cards. They did this by getting their products and services into as many sales and distribution channels as possible. Of course there must be a customer on the other end buying all this stuff, but often you didn’t really care who they were, as long as more units flew off the shelves.
 
That’s not how the modern company thinks. Today successful brands start with the customer. They recognise that customers spend their time across many channels, and wherever those customers are, that’s where they should be meeting their customers’ needs. Their arc stretches across multiple axis. And the more information you can learn about the customer, the better you can serve their needs, and the more valuable the relationship becomes. That’s digital transformation: from linear transactional channels to a circular, dynamic relationship with your subscriber. A circular economy is a trigger for the subscription model- Long term, engaging, evolving, value enhancing. So, get ready to subscribe to the thought!
 
 

ENDS

Suresh Dinakaran is Chief Storyteller at ISD Global, Dubai and Managing Editor, BrandKnew.

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