Revenue is the driver of business, and most businesses for the longest time have been accustomed to building a pipeline of business, targeting specific demographics or segments of customers, or raising brand awareness so as to generate interest in products or services. Recently, however, a subtle shift to consumer engagement has made itself evident, one that may very well fundamentally change the way we view marketing and the business of customer acquisition in the future.
The failings of broadcast brand recall
Slowly but surely since the late 90s when the Internet appeared, traditional marketing media, namely broadcast advertising mediums, have been failing. Part of this has simply been reducing effectiveness of the broadcast mechanisms themselves like Newspapers, which in 2012 suffered their lowest year of advertising revenue (inflation adjusted) since 1950, or direct mail advertising, which peaked in 2005. In the case of channels like Television, the abundance of DVR (Digital Video Recording) technology and streaming media services like Netflix and Hulu have produced a dramatic change in the effectiveness of TV commercials, as more and more consumers opt to watch their favorite shows sans advertising. Something more insidious, however, has slowly been at work undermining basic marketing precepts.
In the 1940s and 50s various key pieces of research and marketing theories emerged which have dominated customer engagements over the last 60-70 years. At the core of these concepts were two basic precepts. The first was greater understand of human motivations in respect to purchase behavior and aspiration, probably best characterized through the work of A. H. Maslow and his “Theory of Human Motivation” and his well known “Hierarchy of Needs”. The seconds was extensive research into the ability to influence consumer buying behavior, and the concept that a consumer could be stimulated to choose a product or a brand based on latent stimulus recall – the process of reinforcing a brand and it’s core values over time through messaging and advertising. These two basic marketing and behavioral principles have underpinned the workings of advertisers and marketers for almost a century.
Based on this, marketers and advertisers have worked tirelessly to improve their understanding of market segments, consumer behavior and psychology with the objective being to match very specific messages that stimulate either brand recall at a future date, or an near-term response to an aspirational desire or a perceived need. There were those at times that attempted to reduce the effectiveness of these activities down to some simply formula that could be applied to a target audience or segment – applying market research, sample focus groups responses, impression and conversion metrics. There were others that believed the real masters of these arts were the most creatively and intuitively gifted artisans, those constantly seeking the next campaign, advertisement or message that resonated so perfectly with its intended audience that it would result in a windfall gain for its sponsor, and a cascade of awards from the industry at large in recognition of the inherit brilliance exhibited.
The truth was often somewhere in the middle.
Today, however, we are seeing long held traditional broadcast mediums failing in their effectiveness combined with a deluge of messaging platforms anew, which muddy the waters from which latent stimulus recall is meant to emerge. This combination of noise and reduced effectiveness is making traditional broadcast campaigns increasingly uneconomical, and thus we’ve seen a dramatic repurposing of advertising budgets to mobile, social and online in recent times, attempt to find new mediums that can replace the failing ones.
Internet advertising is projected to grow by 15 percent each year between 2012 and 2015 and will account for 66 percent of global ad spend growth
Zenith Optimedia Report (June 2013)
But the problem is not just that broadcast mechanisms are failing (or losing effectiveness), the problem is that getting brand recall in an ocean of messages is getting harder and harder.
Building advocacy not recall
The aim in the past has been to build brand awareness, and stimulate brand recall with increasing effectiveness over time. In addition, campaign marketing and database marketing are designed to target specific audience segments with a product offer that might fit the audience, giving a higher percentage of conversion that a general broadcast approach. These all rely on the effectiveness of traditional broadcast mediums.
As social media has emerged we’ve seen tribes and crowds collectively demonstrating behavior or responses to certain messages. In some cases it is as simple as a viral video of a cat doing the harlem shake, and in others it is powerful crowd-based movements or advocacy – such as the Occupy Movement that emerged out of the global financial crisis.
In the past brand awareness was also, to some extent, powered by or enhanced by word of mouth. Today, however, brands can literally come from nowhere to being the power behind a billion dollar start-up, all based on pure advocacy. Brands like Twitter, Instagram even Facebook were all built in the space of just months with zero advertising dollars spent, and yet they became some of the biggest and most recognized brands on the planet.
In these instances, there’s no strategic advertising approach that is going to create viral advocacy with the likes of Instagram. Advocacy is also a little more temperamental that traditional well built brand awareness, although advocacy in itself by its nature builds awareness. Take Facebook. Recent research shows teens abandoning Facebook in droves, largely because it has become uncool – as soon as your Dad or your Grandma is on FB, it doesn’t quite have the same dynamic.
Advocacy can be generated very quickly, but the crowd is fickle and they can turn just as quickly. The acquisition of Tumblr by Yahoo a couple of months ago quickly created a backlash against the cool, new social brand. Here are some great moments of dialog from the Tumblr crowd that illustrate:
The advantages on the advocacy side, however, far outweigh the negatives. Advocacy, when done right, adds massive credibility to the brand and creates broad affinity at very little costs. It also scales much better than traditional awareness approaches. The trick with advocacy is that it is not generally generated through messaging strategies. It’s more likely to be generated through dialog with the crowd, or a general engagement philosophy of the brand, but one thing is certain – the more the crowd is empowered by the brand, the more engaged they are, and the more advocacy is allowed to happen.
“More than 4,500 survey responses were collected from each brands social media pages over a two month period and supplemented by 800 interviews to inform the findings. This showed that four out of five consumers would be more inclined to buy a brand more after being exposed to their social media, with 83 per cent happy to trial the product in such circumstances…”
IAB Study Finds 90% of Consumers Back Brands After Social Media Interactions – via The Drum
I recently had the opportunity to discuss social engagement with the head of Social for Citibank and for ASB Bank in New Zealand. The resulting discussion was very insightful and showed that even during times of crisis, social media is becoming an anchor for consumers to connect with your brand.
See BREAKING BANK$ – How the crowd is changing brand advocacy in Banking
So if you’re in a business today where you are trying to create spin, engineer virality, amplify the brand or architect the dialog, maybe step back from that approach and try something simpler.
- Dialog – Demonstrate an openness to engagement
- Crowdsource – Find out what the crowd likes and dislikes
- Analyse Sentiment – Align your approach, language and product strategy, giving to the crowd (as opposed to selling or messaging)
- Incentivize Influencers – Encourage and incentivize influencers in the crowd to advocate
There’s one central shift in philosophy for brand mechanics here though. Advocacy and brand affinity occurs far easier when there is real value and when the crowd creates the sentiment. The objective should be to align the organization with the crowd, not to manipulate the crowd. Another word of warning – rewards or loyalty program approaches are far less effective than the unbridled passion of a crowd who loves what you are doing.
Whatever your strategy for engaging customers, brand awareness and brand building can no longer be done independent of building an audience. It’s not about pipeline or demographics, it’s about advocacy.