Reinventing marketing: six killer issues
My latest
article in Marketing magazine is on theme of ‘Brands as information services’. Previous articles have looked at ‘volunteered
personal information’, consumer decision making, marketing metrics and
the general trend towards consumer empowerment. They all address different angles of what
we could call ‘a control shift’, a sort of Copernican revolution where the
individual (or customer, or citizen) – rather than the brand or organisation -
becomes the effective, operational centre of commercial gravity.
From what I can see, six contributing
sub-shifts are coming together to make and define ‘this control shift’. Let’s
give them a bit of helicopter vision.
1. Personal
Information Management
As the costs of processing information fall
(down a billion-fold since the 1960s) information is becoming a tool in the
hands of individuals as well as organisations. When information was very
expensive to gather, store and handle, organisations had an effective monopoly
on information management. The more information becomes a tool in the hands of
individual the more we need to understand and address how individuals want
to use information, in different ways, to manage their lives better. This is very different to understanding how to use information as
a tool in the hands of the organisation.
One aspect of this is the emergence of a
new industry of personal information management services.
Another aspect is a change in
the tides of information flows that shape and define how our society (including
marketing) works. For the last few hundred years, the dominant flow of
information has been ‘top down’ from organisations (in the form of governments,
institutions such as the church, companies, the media etc) to individuals. Now,
in a very short period of time, the dominant flows of information are turning ‘bottom
up’: from individuals to organisations and each other. Processes, practices,
strategies and tactics designed for an era when ‘top-down’ ruled the roost now
need to be re-thought, sometimes from scratch.
(By the way, this doesn’t mean the end of
top down communication. In my view, awareness advertising has a rosy future, for
example. What it does mean, however, is that we can no longer assume that ‘top
down’ is the only or best mode. Instead, we need to understand which mode is
right for which circumstances, jobs and situations.)
2.
Consumer decision making
We all know that thanks to the internet consumer decision-making
habits are changing rapidly. Peer reviews, price
comparisons, social media etc mean that individuals are paying attention to,
and trusting, different sources of information than they did in the past. Nevertheless,
it’s easy to miss the real significance of this development, which is this:
that making and implementing better
decisions is fast becoming the new high
point of value. Recoil in horror at this if you
like (yes, it does upset many long-standing marketing applecarts such as the
emphasis on ‘persuasion’ in marketing communications) but this is an emerging
fact of life for marketers. The fact is, if I can make a better decision it
will lead me to a better value product or service anyway, in which case for me, the pivot
point of value is the decision, not the product or service. Denying this is not
really a useful option.
By the way, we shouldn’t confuse ‘better
decisions’ with 20th century economists’ ‘rational’ decision-making
which (as we’ve seen) is actually lunacy writ large. What’s ‘better’ depends on
what I’m trying to achieve. If my goal is to have fun, my decision may look very
different to if I want to impress other people, feel safe and secure or solve a
problem efficiently and cost effectively. Like beauty, ‘better’ lies in the eye
of the beholder. Also, a key aspect of ‘a better decision’ may be the decision-making
process: if I can arrive at the same basic decision using half the time, effort
or hassle, that’s a positive result. This is why understanding what a better
decision (and a better decision-making process) look like from the individual’s
point of view is now critical.
3. ‘Brands
as information services’
If shifts 1) and 2) above are real, rethinking
how and why brands work is a must. ‘Brands as information services’ is one way
of positively reinventing branding for the new environment.
4.
Touchpoints
Communication and retail channels are
changing radically and rapidly. We all know that. Big challenges include multi-channel
retailing and integrated marketing communications; creating a single seamless experience for
customers across touchpoints; and creating a single organisational view of the
customer across these touchpoints. These are big issues indeed. Yet (again) it’s
very easy to miss the real point of touchpoint and channel change, which is
this: nowadays consumers have as much choice between touchpoints and channels as
they have between products and services. So they are migrating towards those
touchpoints and channels that add the
most value for them.
This requires both a practical and a
mindset change. The traditional industrial age view of the world created a neat
‘division’ of labour between ‘the product’ (or service) and its marketing. The
product delivers value to the consumer; the marketing (including channels to
market) are a means to an end; to realise the value of the product by selling
it.
That’s fine, except it doesn’t see things
from the individual’s or customer’s point of view. From the individual’s point
of view, touchpoints and channels are there to help me go to market; to find
and access value. So I will choose those touchpoints that help me achieve my
goals most efficiently and most effectively. If a touchpoint fails to help me –
if it obstructs or undermines my ability to make a better decision, or wastes
my time, or abuses my attention – then I’ll ignore it or go elsewhere. The
bottom line, therefore, is that touchpoints and channel strategies have to be
designed and delivered as sources of value for customers in their own right. They
are no longer just a means to an end. They are a part of how you create and
deliver value. This is where the rubber
hits the road in terms of designing win-win relationships with customers.
5
Marketing and market metrics
Our current approach to marketing metrics
is misguided, myopic and narcissistic. Most approaches to marketing metrics
only measure one side of the equation: what it costs us to do the marketing,
and what benefits we get from this marketing (sales uplift, awareness shifts
etc). It’s as though customers (you and me) didn’t have any metrics of their
own. This is clearly nonsense. Many of the most important metrics in marketing are
personal metrics such as value for
time, return on attention, and the overall costs and benefits of achieving what
I want (as distinct from the money price vs attributes of a
particular product or service). Think of the difference (for example) between
the price/benefits of a can of baked beans and the total costs of planning for,
shopping for, preparing, serving and clearing up after a dinner for the kids. In
practice, these personal metrics remain about as explored as the dark side of
the moon. Yet they are the real metrics behind most consumer behaviour.
This is a minor tragedy because the
emerging rule of thumb for successful marketing is something along the lines of
“across every touchpoint we will find ways of improving your metrics”. This is
another mini-Copernican revolution where value is no longer defined in terms of
the attributes of the product or service but by the organisation’s overall contribution
to the individual’s personal KPIs.
6.
Value propositions
What happens when we put the above the five shifts together? The answer is simple. We are looking at a
much more person-centric and much-less organisation- or
brand-centric definition of value. We are looking at the control-shift.
If we look at it in the round, this control-shift is pretty
comprehensive. (Please tell me if you think I’m missing something crucial, or
if I’ve got hold of the wrong end of the stick somewhere.) The exciting thing about this is that for
each of the six shifts there is more we currently don’t know than we do. Marketing is no longer just about applying
tried and tested ‘best practice’ for branding, market research, advertising,
whatever. The shifts we are talking about here are only just taking shape now,
so our real job is one of research, exploration, experimentation, learning and discovery.
I think of them as six exciting lines of enquiry. I look forward
to sharing some of my discoveries with you over the coming months.
Alan Mitchell
www.ctrl-shift.co.uk
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