Marketing as Software: a short ramble

I’ve recently been loosely thinking about what the future of marketing might look like.  It seems that with all the new possibilities at our finger tips, much of the discussion in the industry has been about how innovation can improve advertising as we currently know it – programmatic for tighter targeting and greater efficiency, new delivery mechanisms for richer, native content, or technology to beat the ad blockers so we can still serve our ads the old way.

These ad serving technologies are breathing new life into traditional media channels carrying traditional advertising but it doesn’t feel like we’re making the most of the potential of new technology to improve the value of marketing to both consumers and business.  To paraphrase Henry Ford, we’re just creating faster horses.

Something I’ve been considering is whether marketing will increasingly become more like software.  Marketing will have a role within a wider media ecosystem, will connect us to people, objects and platforms, will be more closely aligned to consumption and will offer greater utility and relevance to consumers than advertising ever could.  Marketing as software will ensure brands are more fully understood and valued not by what they say (through advertising) but by what they actually do for people.

For marketers, this makes complete sense.  Creating meaningful connections with consumers by being useful means more first party data collection, more time spent with the brand and more opportunity to convert to purchase.  For consumers, it provides more opportunity to improve their interactions with the world through the now ubiquitous technologies we possess, chiefly mobile.

So what do I mean by software?  We’re already starting to see increasing interactions between objects and the benefits this provides to the user.  The object itself, for example mobile is the hardware, the network they open up, the interactions and ecosystems that it gives access to is the software.  This is where the value for marketing lies – the connectivity to objects, people and platforms and the experience this creates.  Software are the apps, tools, games and coding that do things for us.  This is what advertising in its current guise struggles at, yet this is what people truly care about.  Advertising provides little utility in a world where information and entertainment is instantly abundant.  Clearly brands are already in the software space when it comes to product development.  Nest, Sonos, finance companies etc. all rely on software for product experiences and service delivery, but I mean marketing as software which isn’t quite the same thing.

Four days in to 2016 and we’ve already seen some great examples of this.  Virgin Active have just created 33 new fitness emojis to help people talk about their new year fitness achievements.  Public Health England have just launched their Sugar Swaps App which enables parents to monitor how much sugar their kids are consuming by scanning bar codes of 75,000 products to reveal the sugar content and suggest alternatives.

The EA Sports Gifferator for Madden NFL 15 is another great example of marketing as software.  During the game, the Gifferator created a stream of GIFs highlights which fans could edit with their own headlines to share with rival fans to taunt them with in real time.  Marketing is providing connectivity, entertainment and utility through a piece of software.

Nike have been doing this for some time through their Nike Plus apps and product ecosystem, giving users a much richer brand experience than through advertising alone and providing Nike first party CRM data with which to build deeper relationships.

One further advantage of marketing as software is that like software, marketing can improve iteratively based on data and live feedback loops, constantly learning and improving in real time to improve the user experience.

Thinking about marketing as software puts the user experience at the heart of marketing, rather than seeing marketing as something we do to people.  It places the brand within the wider ecosystem that people navigate their worlds in.  It creates brand experiences people actually want to have and it provides meaning for consumers based on what brands are doing rather than saying, creating value for people and business alike.

For now I guess this is just a seed of an idea  I’ve not yet given a huge amount of thought to, but perhaps a thought to develop into something more meaningful in 2016.  Maybe.

Oh, and happy new year!

 

 

Pressing Restart

It’s been a while since I last blogged.  There’s not a single reason for this, just a collective of stuff I’ll creatively label ‘life’.

Moving from Hong Kong back to London, changing jobs, living somewhere new, travelling to for work, buying a new house and impending fatherhood keeps things relatively busy.

Not only that, I’ve also questioned whether in fact there’s anything left to be said in the marketing industry that hasn’t already been said in the Twitter echo chamber, or whether another voice further muddies what should be embarrassingly simple waters.

But I’m going to sod all that and start again anyway.  I’m lucky enough to be  exposed to some brilliant thinking, ideas and creativity (as well as a lot of frankly rubbish stuff too) that I want to share, consider and build upon without over complicating the way we think about building brands.

It’s difficult to know where to start after such a long time of not writing anything.  But I guess I should just start by starting.

Now the question is as I’ve ‘publicly’ announced my attention to blog more, am I more likely to do it?  Research would suggest not, but as hardly anyone would take any notice if I did anyway I’m not sure it really matters either way.  Read more about that here: http://www.law.yale.edu/news/12396.htm

Memories of Christmas Past

‘It’s the most wonderful time of the year’.

Even here in Hong Kong where I’m now living, there’s a very special, tangible feeling at Xmas time unlike no other.

This year, I’ve been observing from afar Xmas advertising from brands in the US and UK.  I have to say, generally I think it’s getting better and better each year, and for me, the outstanding highlights have been Lego, Tesco and John Lewis.

lego

Nothing controversial about those choices, I think most people would agree they’re outstanding pieces of work.  But I’ve been thinking about what makes them great and I think they all have one thing in common.

That’s that they all understand that Xmas is really about memories of Xmas’ past, and these ads all brilliantly tap into the existing memory structures, associations and stories we already have about Xmas.

We make sense of the world around us only through our memories and stories from our past.  It’s how we know who we are when we wake up in the morning and how we know what brand to choose from in what would otherwise be an utterly confusing supermarket (actually my first few experiences of Hong Kong supermarkets were a bit like this, like having brand amnesia from not knowing anything about the products on shelf!).

As Daniel Kahneman has written, we have two selves.  The remembering, storytelling self and the experiencing self.  The remembering self maintains the story of our lives, while the experiencing self who lives, feels and knows the present.

But what he also suggests is that the remembering self is the one that holds sway over us. The remembering, storytelling self actually makes future decisions for us, not the experiencing self.  We even think of our future as anticipated memories.

So what these ads have in common, whether it’s a father building dreams together with his son made of Lego bricks, or reminiscing of Xmas’ past with the family through the generations or a throwback to animated Disney classics, they  all appeal to the memories and stories that define who we are and what we understand Xmas to be all about.  We all have stories similar to these, and when we see them played out in front of us, we’re reinforcing those happy memories and encoding new ones with these brands forming new associations with them.

So when it comes to decision making about where to shop or what to buy, when our remembering self cranks up into decision-making mode, it will call upon the strongest; most salient memories forged in out brains and the brands most intrinsically, creatively and emotionally associated with them.

Just as a footnote, Xmas brilliantly demonstrates Kahneman’s theory of the two selves. There’s something very special about Xmas, in that our memories of experience are often much fonder than the experiences themselves! It’s these memories we wish to treasure and the things we do at this time of year are often to form new anticipated memories.  That for me is what makes the new Apple spot so great.  Xmas is all about these memories, and they just really get it.

Irrational Persuasion

Much of marketing is about communicating a brand’s superiority relative to other brands. It makes sense – the reason for building a brand is to make it price inelastic, for people to have the belief that it offers something worth paying more for.  Superiority is a common objective found in briefs and it’s often a metric chased after in tracking reports.

We want people to believe our brand is better than others.

There’s nothing wrong with any of that.  A strong value perception is what makes a brand, well, valuable.

But there’s still a widely held belief in marketing that superiority is a function of rational persuasion.  A simple assumption that if you can convince people with logic why brand x is better than brand y, they won’t dispute the logic and purchase it next time round.

For decades now we’ve known this isn’t the way the human brain decodes (advertising) information.

We know we don’t rationally evaluate every single choice we make.

We know the brain’s System 1 processes and contexts are the driving force behind decision-making

We know most communication is implicit appealing to the emotional, sub-conscious brain

We know that distinctiveness is more effective than product differentiation

And we know that at the end of the day, brands get bought because of mental and physical availability – fame and ease of purchase are what count.

And yet, the industry still tries to convince itself that people sit at home logically evaluating advertising messages.  Inexplicably, so much of marketing is still geared towards providing rational reasons as to why one brand outperforms another with the kind of cognitively processed messaging that our brains try to filter out as much as possible to conserve energy.

There’s no denying great brands start with a great product.  And by all means communicate the product’s core functionality in order to increase saliency- to make the brand mentally available when it’s most needed to be recalled.

Superiority derives from the feeling people have about the brand, the meaning, relevance and ideas they attach to the brand beyond the product’s physical attributes.

Those emotions and memory associations are buried deep inside the brain, they’re not stored in the effortful, slow and calculating working memory part that rational and persuasion based advertising appeals to. And given an opportunity to conserve it’s energy from cognitively processing things it couldn’t care less about, our brains ignore this kind of rationally persuasive stimulus.  

The intangibles, the memory associations and emotions one has towards a brand are the what makes a brand mentally available when it needs to be recalled from deep within our sub-conscious brain.

Effectiveness studies continually show that we best achieve price inelasticity through creating intangible feelings, emotions, meanings, ideas and associations attached to the brand held in people’s minds. Attempting to rationally persuade people of the product’s physical features relative to other brands will at best be quickly forgotten in the over-worked cognitive part of our system 1 brain, or at worst completely ignored.

Thinking in Context, Part 2

Where were we?

Just to recap, in the previous post I was reflecting that context should be given the same attention in our industry as content is undoubtedly receiving (and an excellent recent post by Karen Nelson-Field asks some necessary challenging questions about the effectiveness of social video here).

The power of context to change behaviour is immense.  Brands should be finding ways in which to harness it more effectively.

However, we’re now less able to control message delivery in the way we once were through, for the want of a better term, old school media planning.  We now have less control over the ‘who’, ‘when’ and ‘where’ that ensured a message was delivered in a tightly controlled medium.

But new technologies and platforms are allowing us to think less about channels and become more aware of the context of communication; to leverage the contextual opportunities presented for system 1, impulsive behaviour.

Google Now is an intelligent little app that sends contextually relevant information to your mobile dependent on time and location.  For example, the app’s alarm doesn’t just remind you to attend your lunch date.  The time it chimes depends on how far away you are from the restaurant and how much traffic there is on the way, offering alternative directions if necessary.  As Google describe it, ‘The right information at just the right time’.  This perhaps could be great for retailers with time sensitive promotions for example.

Image

But what if we could go further and start to link data sets?  For instance, somebody searching Google for dining tables on their home desktop then gets in their car 10 minutes later.  A Google Now enabled device would recognise this from their geo-location data and serve an offer from Ikea straight to your mobile, with directions of their nearest store and how to get there.

A new context aware mobile platform called Gimbal does link people’s online and mobile behaviours with physical location awareness using geo-fencing technology (there’s a great video about it here).  So we can actually now deliver context aware, personalised, relevant content at precisely the right time.

Let me try and explain further…

My phone might recognise me as a Cappuccino loving Hong Kong resident working in the marketing industry with an interest in 1980’s comedy sci-fi films just from my online behaviour (Searches, cookie data and social activity leave some pretty large digital footprints!).  On my way home from work, my phone’s geo-fencing technology would identify when I’m within 2 minutes of a new Starbucks I’ve not been to before (it knows my regular haunt is Java Java) and sends me a notification of a new coffee blend on the menu and an offer to redeem.  Great, I think.  I’ll try that.  When I get home, the cup has a QR code of a free rental of Back to the Future which by taking a photo of enables me to download the film for free through their promotional tie-in with Netflix.  I download the film with my Facebook log-in, in the process telling my friends in a 5km radius of the new Starbucks about the store and the free film download, driving more footfall.

The opportunity to combine this contextually aware technology with the predictive power of Google Now, the purchase behaviour data of the likes of Amazon or a Taobao and the social behaviour data of Facebook or Weibo, could obviously open up countless new revenue streams for brands.

All of this essentially means new technologies, particularly mobile, are making it easier for brands to identify contexts and leverage their power through physical and mental availability.

The right information at just the right time.

Thinking in Context, Part 1

We hear a lot in our industry about branded content.  It can sometimes be effective. People do sometimes want to watch a brilliantly crafted piece of film from a brand, or a water-cooler moment (I’m thinking Red Bull Stratos here) or other forms of great branded content that makes brands famous.  But content of any sort is only consumed or interacted with if it’s either entertaining, useful or relevant, not because of the popular myth in our industry that ‘people are demanding more from brands’.  It’s simply not true. Marketing is still largely the uninvited guest to the party and as such has to work bloody hard to even get noticed, let alone be demanded to return.

As the industry continues to loudly bang the content drum, one thing we’d do well to remember is the critical importance of context in communication.  And for good reason.

Context drives so much of our decision making, our choice of brands.  It’s in context that communication derives meaning.  Contexts change behaviour.

But context isn’t just a matter of channel selection.  In the traditional communications model, brands could simply plan and control which channels messaging (content) would be received in, almost guaranteeing the ‘who, when and where’ of communication .  But in an increasingly fluid media landscape where brands tell their story across multiple touch-points, the channel is less relevant than the context it’s received in.

And in purchasing scenarios, it’s often our unconscious mind (driven by emotional responses we’re rarely aware of) that makes decisions for us, such as deciding between brands.

Nowhere will you find this more eloquently explained than in Daniel Kahneman’s Thinking, Fast and Slow.  In it, he makes the distinction between the two systems of human thought.

thinking

‘System 1’ is the kind of intuitive, effort-free thinking we do without realising we’re doing it and drives most decision making in our day to day lives.  For example, just reaching out for the bottle of Evian on the shelf rather than cognitively evaluating each and every bottled water brand on offer.

‘System 2’ is the conscious, effortful decision making that’s laborious and slow.  We’re fully aware we’re doing this kind of thinking, such as solving a complex maths problem.

We’re rarely engaged in System 2 thinking as it expensively drains the brain’s energy mentally and physically – ‘one if its main characteristics is its laziness, a reluctance to invest more effort than is strictly necessary’.

Impulse purchases or purchases made on ‘autopilot’ are characterised by this.  These types of purchases aren’t made with prior intention or through system 2 processing. They’re made on impulse based on emotions stored about the brand and because of the context of the environment – a gentle nudge at the till, the weather outside or what other people next you at the table have ordered.

People’s behaviours are often modified by what’s close to them, what’s available – stimuli in the immediate context.  In How Brands Grow, Byron Sharp explains how brands that are easier to buy through mental and physical availability tend to be bought more often by more people.  Although this sounds simplistic, his theory of ‘availability’ suggests that just being thought about at all in a buying situation increases the chance of purchase.

So it’s imperative for brands to identify, understand and leverage the contextual opportunities for system 1; impulsive thinking.

The role of content in all of this is obviously to generate the sort of emotions and salience to make the brand thought about in these buying situations.  It’s importance shouldn’t be undermined.  My argument is more that context is being more overlooked than perhaps it should.
In Part 2, I’ll look more at how brands can apply technology to go about identifying, understanding and leveraging contextual opportunities for System 1; impulsive thinking.