marketing in a digital world
TRANSCRIPT
Marketing in a digital worldRob Stokes - 1 July 2015
What a new and dynamic world we live in
Think of life 20 years ago and how much has changed since then
Think of the super computer in your pocket and imagine life before that…
Technology and the internet have revolutionised business and life
In particular, our communication channels are not just totally different, but also exponentially faster and cheaper
Everything we once knew has been turned on its head
Marketing as a discipline has been around for about 50 years
Original Definition of Marketing
“Marketing is that function of the organisation that can
keep in constant touch with the organisation’s
consumers, read their needs, develop products that meet
these needs, and build a program of communication to
express the organisation’s purposes”
Kotler and Levy
Journal of Marketing,
1969
The more things change, the more they stay the same…
Let’s break it down…
Original Definition of Marketing
“Marketing is that function of the organisation that
can keep in constant touch with the organisation’s
consumers, read their needs, develop products that meet
these needs, and build a program of communication to
express the organisation’s purposes”
Kotler and Levy
Journal of Marketing,
1969
How important are marketers to a business?
“Business has two, and only two, basic
functions: marketing and innovation.
Marketing and innovation produce
results; all the rest are costs.”
Peter Drucker, 1973
So you’re quite important then (no pressure…!)
Original Definition of Marketing
“Marketing is that function of the organisation that can
keep in constant touch with the organisation’s
consumers, read their needs, develop products that
meet these needs, and build a program of
communication to express the organisation’s purposes”
Kotler and Levy
Journal of Marketing,
1969
Ok, so this has become MUCH easierSocial media anyone?
Original Definition of Marketing
“Marketing is that function of the organisation that can
keep in constant touch with the organisation’s
consumers, read their needs, develop products that
meet these needs, and build a program of
communication to express the organisation’s purposes”
Kotler and Levy
Journal of Marketing,
1969
Digital, particularly mobile, has made research faster, cheaper and more accurate.
But research will only get you so far. You, the marketer, need to find the insight
No one “needed” an iPod…
Original Definition of Marketing
“Marketing is that function of the organisation that can
keep in constant touch with the organisation’s
consumers, read their needs, develop products that
meet these needs, and build a program of
communication to express the organisation’s purposes”
Kotler and Levy
Journal of Marketing,
1969
The forgotten responsibility of marketing
If we are the people “reading the needs”, we have to be the people driving the innovation!
Marketing = Innovation
“Business has two, and only two, basic
functions: marketing and innovation.
Marketing and innovation produce
results; all the rest are costs.”
Peter Drucker, 1973
Marketing = Innovation = Value Creation
Therefore marketing is the primary value driver for business.
You ARE the business!
Original Definition of Marketing
“Marketing is that function of the organisation that can
keep in constant touch with the organisation’s
consumers, read their needs, develop products that meet
these needs, and build a program of communication
to express the organisation’s purposes”
Kotler and Levy
Journal of Marketing,
1969
Data driven one-to-one communication is here, need I say more?
In summary, the marketing and communication tools at our disposal give us more opportunities than ever before, but the fundamentals remain the same
Let’s look at a few key trends which will influence marketing and innovation in the next 10 years
1. The Internet of Things
Can we even imagine a world where every little thing is connected?
It’s like trying to wrap your head around the concept of infinity
A world where every THING knows:What it isWhere it isWhat state it is inWhat it can doWhat it can interact with
Furthermore these Things can communicate with anything/anyone/anywhere/anytime giving instructions, taking inputs, changing behaviour, spewing out data.
IoT will genuinely change almost every aspect of our lives and trying to wrap your head around this is seriously hard. Every person and every business is different so I like to try and understand IoT by walking through my typical day both at home and at work to identify where a connected Thing could help me and my customers
The fishpond The carOffice securityComfort controlThe gymLightbulbs
Try this exercise first for home and then for your business – let your imagination go wild with the possibilities
I find it easier to imagine the possibilities at home which helps imagine them in business
You will find so many places you could increase value either to your customers or bottom line.
Then ask yourself what could happen if your competitor did these things first?
Many of these opportunities will not be feasible today, but how can you be ready for that inevitable future because it is literally around the corner?
2. The Blockchain
The what?!
By now you’ve probably heard of Bitcoin
And yes, it does have the potential to be a truly global currency
But the real breakthrough is it’s underlying technology: the Blockchain.
The Blockchain is a protocol that allows for secure, direct (without a middleman), digital transfers of value and assets
It solves the problem of trust on the internet and it does it with maths and not with humans (who we have relied on for thousands of years).
Importantly, maths at scale is effectively free, humans are most certainly not
This means that interactions and transactions which required a trusted middleman (and their associated cost), can now be done instantaneously and at a fraction of the price.
This is really big.
How does it do it?
In laymans terms, every computer on the Blockchainnetwork keeps a ledger of all transactions on the network and they also verify all of these transactions. This means you cannot cheat unless you control >50% of the network which is nigh on impossible for any person or organisation.
It’s like a completely automated, peer to peer, highly distributed and substantially more trustworthy escrow service
Examples where this could disrupt include all authorisation and verification middle men and all clearing houses
All bank transfers Especially pricey international money transfersShare tradingEscrow servicesContracts
(A common theme here is less business for lawyers and that can’t be a bad thing :)
The Nasdaq is currently doing an experiment on one of its smaller markets using Blockchain technology which will allow authorisation and verification to be decentralised from banks.Barclays, Santander and Chase banks are also investing heavily and experimenting with the technology.
3. Software Eats the World
AirBNB, biggest hotel chain, owns no hotelsUber, biggest cab network, owns no carsFacebook, biggest media company, owns no content
These are just some examples of how software is eating the world and it only gets bigger
Maybe this scenario might paint a more impactful picture
Imagine a driverless car (already exists), becomes an Uber cab (already exists), gets paid in bitcoin (already exists), drives itself for a refuel and service (already exists) and pays with this Bitcoin (already exists).
I call this an “Earning Algorithm”
Sounds like science fiction? With legislation and adoption, this will be reality by 2025 if not sooner.I’d argue that a McDonalds or KFC outlet could easily function in the same way.
That’s 10 years from now, what matters to us is the time in between?
Your business may not yet have been eaten by software, but that’s probably because its hard and would require a lot of processing power.
Hard problems are getting solved
In accordance with Moore’s Law, by 2025, $1,000 should buy you a computer able to calculate at 10^16 cycles per second (10,000 trillion cycles per second), the equivalent processing speed of the human brain.
Peter Diamandis
Cisco thought their problems were too hard for software to solve because they are a hardware company. Software Defined Networking is quickly eating their lunch and they are having to acquire their way to safety
I bet these guys never thought software would eat their world
4. Programmatic ad buying
Media buyers beware, software is eating your job
Today it has become commonplace to buy internet ads through a programmatic interface
You upload the ad, set the targeting rules, decide how much you want to pay and the software does the rest
For the most part this system is cost effective and highly efficient. Software is able to make buying decisions better and faster than any human and it can do it billions of times per second.
Importantly, where your ad is shown is not only a factor of how much you are paying and who you are targeting, but also the past performance of your ad.
This means we need to produce high quality, relevant and personally valuable communications for our customers
Within a short time, programmatic ad buying will sweep beyond digital media. Within 10 years all TV, radio and print advertising will be bought and managed this way.
Once again, this will put quality, relevance and value at the top of the list.
5. Content Marketing
In line with this effectiveness movement driven by the demand for quality, content marketing is becoming an increasing trend for marketers to break through the clutter.
You are 478.25 times more likely to SURVIVE a plane crash than you are to click on a banner ad
But consumers LOVE content
Particularly when it is timely, relevant and ultimately valuable to them
At Quirk we talk about the 10 principles of content marketing
Principle 1 of 10
Content, inspired by an indisputable insight that is relevant to your audience will win hearts and minds.
Plan
Distribute
CreateMeasure
Principle 2 of 10
Data is the key that unlocks insight.
Plan
Distribute
CreateMeasure
Data is the key that unlocks insight
Netflix data philosophy:
Data should be accessible, easy to discover, and easy to process for everyone.
Whether your data set is large or small, being able to visualize it makes it easier to explain.
The longer you take to find the data, the less valuable it becomes.
“There are 33 million different versions of Netflix.”
Joris Evers, Director of Global Communications
Data is the key that unlocks insight
Data is the key that unlocks insight
A look at some of the “events” Netflix tracks:
When you pause, rewind, or fast forward
What day you watch content
The date you watch
What time you watch content
Where you watch (zip code)
What device you use to watch
When you pause and leave content (and if you ever come back)
The ratings given (about 4 billion per day)
Searches (about 3 million per day)
Browsing and scrolling behaviour
Data within movies. Various “screen shots” to look at “in the moment” characteristics
Maybe Netflix is the world’s most entertaining data company?
Principle 3 of 10
What’s the value exchange; offer, utility or entertainment?
Deliver a real value exchange, that favours the user.
Plan
Distribute
CreateMeasure
Principle 4 of 10
Not all content is equal. Your strategy must balance impact with ongoing conversation. In isolation neither is sufficient.
Plan
Distribute
CreateMeasure
Not all content is equal
Principle 5 of 10
Stand for something. Make me care.
How does your story resonate with the audience’s worldview?
Plan
Distribute
CreateMeasure
Make me care.
When consumers are surrounded by an ocean of branded content, constantly occupying neutral ground means a slow drift into obscurity.
Consumers want brands to speak out - not about themselves but rather relevant social issues:
73% of Millennials believe that businesses should share a point of view on issues.
73% also think businesses should influence others to get involved in an issue.
Source: (MSLGroup, February 2014)
Principle 6 of 10
Every story has a hero and a villain. You need an enemy.
Who or what are we fighting against?
Plan
Distribute
CreateMeasure
Principle 7 of 10
Format presents opportunities for innovation.
Is there a more interesting or intuitive format to deliver the story through?
Plan
Distribute
CreateMeasure
Principle 8 of 10
Algorithms will continue to determine who sees what. Pay attention to the shifting science.
How is the content relevant to the platform?
Plan
Distribute
CreateMeasure
Google Now on Tap
1.Aug. 23, 2013: Facebook Enforces Quality
2.Dec. 2, 2013: Facebook Breaking News
3.Jan. 21, 2014: The Importance of Text Updates
4.Feb. 24, 2014: Tagging for Additional Reach
5.Aug. 25, 2014: The Fall of Click-Bait
6.Sept. 18, 2014: Taking Advantage of Trends
7.Nov. 14, 2014: Penalizing Promotional Posts
Principle 9 of 10
Narrow the focus. Customise the experience.
Who is this content for? Which segment will it resonate with best?
Plan
Distribute
CreateMeasure
Principle 10 of 10
All marketing effort must live or die by its data-proven ability to:• Acquire new consumers• Increase purchase frequency and AWOP• Retain or up-sell existing users
What’s the most appropriate metric to gauge success and why?
Plan
Distribute
CreateMeasure
The Principles ProbesContent, inspired by an indisputable insight that is relevant
to your audience will win hearts and minds.
What is the relevant insight we’re working off?
Data is the key that unlocks insight. Opinion aside, what can we learn from the data?
Deliver a real value exchange, that favours the user. What’s the value exchange; offer, utility or entertainment?
Not all content is equal. Your strategy must balance impact
with ongoing conversation. In isolation neither is sufficient.
Does our content calendar contain both fireworks and
bonfires?
Stand for something. Make me care. How does your story resonate with the users worldview?
Every story has a hero and a villain. You need an enemy. Who or what are we fighting against?
Format presents opportunities for innovation. Is there a more intuitive format to deliver the story?
Algorithms will continue to determine who sees what.
Pay attention to the shifting science.
Is the content relevant to the platform? What are the ROE?
Narrow the focus. Customise the experience. Who is this content for? Which segment will it resonate with
best?
All marketing effort must live or die by its data-proven
ability.
What’s the most appropriate metric to gauge success and
why?
6. The Algorithmic Gatekeeper
Increasingly there is a robot standing between you and your customer.
And worse still, your customer wants him there…
We see this on a rudimentary level today
Google search, Facebook news feed and the Apple App store are the best examples.
If you want to reach your customers through these channels, you must first please the algorithm
The algorithm filters noise for consumers so in theory they only get what they want
Facebook has shown us how dangerous and fickle these gatekeepers can be and now they are evolving and becoming more sophisticated
Apple’s Siri, Amazon’s Echo and Microsoft’s Cortana are the front runners of this new breed along with Google Now which is likely to be the biggest in Africa as we are an Android continent.
What does this mean for business?
You have to understand who your gatekeepers are or could be and be prepared to please them or work around them.
There is a lot to learn so starting early helps
And it will be hard to work around them because our customers will ensure they are there.Amazon Prime is one of the few examples where this might work
If a computer is as smart (and then quickly smarter) than a human AND we trust it, why wouldn’t we let it watch us and listen to our conversations, possibly even our thoughts.
“There when I need it, invisible when I don’t”
This level of information/access + intelligence will make gatekeepers phenomenally valuable to consumers. They will be unsurpassable and therefore in most cases we have no choice but to please them.
Gatekeeper Optimisation – like SEO only coolerStart thinking about API’s. Google Now has a great API which anyone can connect to.
Lessons we can learn, actions we can take
Change and disruption are inevitable. This wave still has got a long way to go.
But this change creates opportunity and as executives, we must embrace it
If you’re not innovating you’re already dying
Traditional Marketing Scenario
Different stories
about the same value.PRODUCT / SERVICE
DEVELOPMENT
STORY TELLING
Marketing teams tend to rely on “innovation departments” to develop new value, choosing to focus their resource and attention
almost solely around developing story…
Balanced Marketing Scenario
Make things
people wantTell them about it
PRODUCT / SERVICE DEVELOPMENT
STORY TELLING
Reconsider the balance of focus by creating more “marketing” products that express the brand’s purpose.
A culture of constantly trying
new things is vital.
“If you always do what you’ve
always done, you’ll always get
what you’ve always got.”
Henry Ford
As is a culture of pushing the
boundaries and accepting failure*
* Failure done right:
- Something never done before- A disproven hypothesis
- Building IP & competitive advantage
But what about the Innovators Dilemma? Companies can’t innovate.
Figure out what works best for you. The hardest parts about becoming a genuine corporate innovator are having the guts to threaten your own business and learning how to embrace and benefit from failure. Once you get over these, with an culture of curiosity and innovation anything can happen.
Here is a rule of thumb I really like to get the ball rolling…
70 20 10
70 20 10Focus on
what’s working
now
Developing
and guiding
new ideas that
come from the
10%
Try new
things, start
small
Marketing in the 21st Century is about being Fast and Remarkable
Remarkable, so you are noticed in the clutter
Fast, so you can take advantages of the opportunities to surprise and delight your customers
You need to master the rules so you can break them
You also need to be hungry for knowledge and eager for change
Change is here to stay and it’s likely to speed up
We tend to overestimate technology in the short run and underestimate it in the long run
Whilst there will be plenty more of the same opportunities in 5 years’ time
What is new will be a surprise to all of us
This is not just true for your business
And it’s not just true for marketing or even business as a whole
It will be true for life in whatever place you find yourself
We cannot prepare for this future now because we simply don’t know what it is
But you can be ready and you can succeed
Being a highly adaptable, life long learner is the only way to ensure your success in a digital world
Not just interested to learn, but thirsty for knowledge
Not just open to change, but embracing of it
Not just open to change, but embracing of it
These life skills will help you be quick and will help you innovate
“It is not the strongest of the species
that survives, nor the most intelligent
that survives. It is the one that is most
adaptable to change.”
Possibly Charles Darwin
Carpe Diem!
Thank You