Experiences- the 7th Era of Marketing
Page 3
To map our experience journey together, we’ve split this book into two halves.
• In the first half, we introduce you to this new era and discuss why it’s vital for marketing to lead this new initiative and to earn its strategic seat at the table.
• In the second half, we provide a detailed look at the process of CCM and present an approach for:
How you might roll it out
How you’ll need to communicate it
How you can build a measurement plan for it
How you can ultimately build a process that is adaptable and scalable
It’s a journey for sure, and one for which we readily admit we don’t yet have all the answers. This is as much an exploration for us, as it will be for you. Thank you for coming along for the ride as we chart this new map. As Confucius once said, “Study the past if you would define the future.”
Let’s go create the future of marketing together.
—Robert Rose and Carla Johnson, March 2015
ENDNOTES
1 http://www.foxbusiness.com/personal-finance/2014/09/17/eventbritemillennials-driven-by-fomo-spending-more-on-experience-economy/
2 http://www.jwtintelligence.com/2013/01/data-point-constantly-connected-millennials-crave-sensory-experiences/#axzz39Be89ntb
3 http://www.v3.co.uk/v3-uk/news/1979635/microsoft-boosts-msn-portal-strategy-ecommerce-framework
4 http://www.adweek.com/news/technology/ifonly-sells-2000-experiences-its-first-year-158766
5 http://hbr.org/2014/07/the-ultimate-marketing-machine/ar/1
6 Ibid.
7 http://www.mckinseyonmarketingandsales.com/sites/default/files/pdf/Marketing%20Disruption.pdf
8 http://news.marriott.com/2014/09/in-an-industry-first-marriott-international-makes-bold-marketing-move-launches-a-global-creativeand-content-marketing.html
9 http://contently.com/strategist/2013/06/11/4-content-marketing-lessons-from-qualcomm-spark/
10 http://contentmarketinginstitute.com/2013/04/brand-content-media-transformation-case-study/
11 http://www.workforce.com/ext/resources/archive_mediafiles/Google_GSA_ROI_WP.pdf
12 http://www.businessweek.com/articles/2014-06-20/clayton-christensen-responds-to-new-yorker-takedown-of-disruptive-innovation#p2
13 http://newsroom.accenture.com/news/us-switching-economy-puts-up-to-1-3-trillion-of-revenue-up-for-grabs-for-companies-offering-superior-customer-experiences-accenture-research-finds.htm
14 Ibid.
15 http://blogs.hbr.org/2012/05/three-myths-about-customer-eng/
16 http://www.marketingprofs.com/charts/2014/25456/when-are-consumers-ok-with-brands-collecting-personal-data
17 http://blogs.hbr.org/2012/05/three-myths-about-customer-eng/
18 Kotler, Philip. Kotler on Marketing: How to Create, Win, and Dominate Markets. Part Four, Transformational Marketing. Free Press, 1999.
“You can’t connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future.” | Steve Jobs
So, the first question is, why now?
Why is it so important for marketers to lean in, step up, and disrupt classic modes of operating to create differentiating value through content-driven experiences?
Look at our most recent past, and you can see entire industries and professions being disrupted by the Internet and the web. Entire business sectors such as publishing, retail, music, banking, and even manufacturing have undergone seismic shifts. The pursuit of professions such as photographer, journalist, travel agent, musician, and doctor has also gone through fundamental disruption.
Soon, literally trillions of connected devices will enable communication between companies and customers, and vice versa. 3D printers and new materials are enabling entirely new capabilities to produce products. If you don’t believe that the same thing that has happened to photographers, journalists, and musicians won’t happen to product and manufacturing companies, you are kidding yourself.
And marketing is changing, too.
MOVING TOWARD A 2020 CONTENT MARKETING PLAN
Today’s powerful search engines, social network filtering, and ubiquitous mobile computing capabilities place powerful new tools in the hands of customers. A buyer’s journey is no longer a straight line, not even static. People now can (and do) flexibly locate information, compare pricing, and make social recommendations about any number of competing solutions.
Customers are now savvier—simultaneously becoming researchers, publishers, reviewers, influencers, and experts on any manner of products or services. The ease by which information can be shared across the Internet, including mobile and social touch points, has required businesses to try to influence audience behavior by increasing—exponentially—the amount of content they produce.
Today, what generates interest, persuades, engages, and creates a sense of customer loyalty is the consistent engagement and unexpected delight in the experience that people have with the brand. In effect, today’s marketers are in the business of being media companies—constantly informing, entertaining, and delighting audiences, while helping them to see that brands offer a differentiated approach to solving any customer need or want.
For marketers, it’s simple: business as usual isn’t. Marketers shouldn’t be acting more like media companies—they should BECOME media companies. In a world where audiences are increasingly fragmented, the goal can no longer simply be about developing transactional relationships with customers; it must be about continuous engagement, passion, and loyalty. In short, marketers must focus on aggregating a passionate, loyal, and engaged audience, while developing content-driven experiences for long-term success.
So, yes, customers have fundamentally changed the way they browse, buy, and become loyal to the products and services they purchase. And it may seem strange, but we’re now more than 20 years into the “digital disruption” that the Internet and the web brought to business. Guess what? People have already adapted to it, and remarkably so. Toddlers now routinely try to swipe print magazines, and are frustrated when the “screen” doesn’t change. It’s estimated that 36 cents of every dollar used for purchase is now influenced by digital content. And 84% of store visitors now use their mobile devices before or during a shopping trip.19
The 1989 movie, Back to the Future Part II, was set in the year 2015. You may be wondering where our hover boards are. Also know that the dystopian 1982 film, Blade Runner, is set in 2020.
Do you have a plan for 2020? It’s a lot closer than you might think. By the time this book is published, you will be closer to 2020 than to a number of things we regard as the recent past:
• Your first Tweet—which could have happened in 2007
• Your first Facebook page or ad—which also happened in 2007
• Your first iPad—which launched in January 2010
So, 20 years into the digital disruption, isn’t it about time we look for the next evolution of marketing? The web is no longer new. What’s next?
Well, as Mr. Jobs so wisely said, we can’t connect the dots by looking forward—we need to look back to where we’ve been in order to see where we are going. Let’s step back and get some historical perspective.
THE SEVEN ERAS OF MARKETING
Most marketing textbooks generally agree that the development of marketing, as a process, occurred over five distinct eras covering roughly 125 years, with each era spanning roughly 20 to 30 years each. A sixth era, the Relationship Era, is commonly acknowledged (though not in all university textbooks) to be the current era, and began at dusk of the last century.
We believe we are now entering a seventh era, the Experiences Era, where the experience, rather than content, is king. But before we explore this new era more fully, let’s put some context to the last 125 years.
The new, seven eras of marketing include the generally accepted Relationship Era—starting in the 1990s and lasting until today—and the new Experiences Era starting in 201
5.
THE TRADE ERA: 1850s
You can hardly expect to even recognize marketing, as we understand the term, during this era. The Industrial Revolution that had already begun in Europe was just taking wing in the U.S. The 1800s was a century marked by invention and innovation in every aspect of business. Historians often call this the “market revolution,” where the rapid development of manufacturing and advances in farming had huge effects on how people bought and sold goods and services.
This ad from 1885 touted Dr. Price’s Cream Baking Powder and Flavoring Extracts.
This was a time marked by companies selling the excess of production. Whether large or small, companies were in the business of directly manufacturing a product (or harvesting one) and selling what they could through storefronts or marketplaces. Marketing in this era was characterized basically by manufacturers identifying the optimal places to sell and trade their goods.
Of course, advertising existed during this era and marketers were intent on describing the value of their products. For example, there’s a wonderful ad for Dr. Price’s Cream Baking Powder and Flavoring Extracts. Perhaps the most notable thing about the ad is that it feels compelled to tell you This ad from 1885 touted Dr. Price’s Cream Baking Powder and Flavoring Extracts. that the baking powder contains no ammonia, lime, or aluminum (was that really a differentiator in the late 1880s?). But also note that this product was available only where the company had storefronts (in this case, Chicago and St. Louis).
This focus on “availability,” or “place” (as we start to build toward the classic four P’s of marketing—price, product, promotion, and place) is what drove us to our next era.
THE PRODUCTION ERA: 1900s–1920s
By the time the 1900s rolled around, the U.S. economy was thriving and many were adapting to more urban lifestyles. Even though “advertising” had been around for many years, this is when the concept really exploded.
The Production Era was truly defined by the idea of mass production—and the public’s fascination with the “science” of mass production. The idea that a company could set up factories to produce things in mass quantities and distribute them across great distances was simply amazing. Marketing and advertising, at that point, were focused on the idea of using this production and distribution capability as a differentiating asset.
A Schlitz Beer advertisement from 1920 highlighted the features of the company’s factory, which were a differentiator for their marketing.
Advertisements and marketing copy of the day would highlight how one company was the ONLY company with the ability to produce such a product in both quality and quantity, and why their manufacturing process was the best in all the land.
A 1920s ad for Schlitz beer summed this up well. The “secret,” said the ad, was in the brown glass used in the bottles. Schlitz only bottled its beer in brown glass—and the windows in their factory also had brown glass—so the science was sound (or at least they said it was) and you could be sure your beer would be fresh.
Everything changed, though, on October 29, 1929, when the stock market crash known as Black Tuesday sent economic shockwaves all around the world.
THE SALES ERA: 1920s–1940s
If the 1920s were about optimism, boom economies, and the idea of distributing our amazing new “products” to diverse “places,” the Sales Era was what brought a complete focus on “price” to the table.
“The man who will use his skill and constructive imagination to see how much he can give for a dollar, instead of how little he can give for a dollar, is bound to succeed.”—Henry Ford
The global depression affected almost every industry and its ability to produce products. Urban areas around the world (which had seen huge population growth over the last 20 years due to the expansion of heavy industry) were hit very hard. This, in turn, hit farming and rural areas and prices for crops fell by almost 60%.
At the center of this era was the salesman, and the focus on selling. In 1925, Bruce Barton wrote The Man Nobody Knows, a best-selling “how-to-sell” book that portrayed Jesus Christ himself as a successful sales executive. Then there was the enormously popular Dale Carnegie and his How to Win Friends and Influence People, which was written in 1937 and, to this day, remains one of the most popular business books ever written. Its main goal was to help you become a better salesperson.
Strategy during this era focused on selling the product, and price was at the heart of it. The marketing strategy was almost entirely based on “what you were getting” and “for what price.”
The luster of overstated advertising had worn off, and the public was skeptical. They wanted to be informed, and have “proof” that what the marketer was saying was true.
A great example from the early part of this era is an advertisement for Pontiac. The company makes almost no effort to realistically depict the car, but focuses instead almost exclusively on the price and factual comparison of what you get for that price.
But, ironically, and leading us into the next era, the latter part of the Sales Era was marked by beautiful, artful advertising depicting the positive side of life. Led by the booming economy coming out of World War II, full employment, and a futuristic vision of the future, marketing was about to experience a renaissance.
A Pontiac advertisement from 1935 spotlighted the “what you get and for what price” focus of the Sales Era.
THE MARKETING DEPARTMENT ERA: 1940s–1960s
If you’ve followed the hit TV show Mad Men, you’re familiar with the Marketing Department Era. Following World War II, and the ensuing economic boom, advertising agencies were all the rage and Madison Avenue was a glamorous place to work. The corporate marketing department was born—it was full of fresh-faced, business school graduates who studied the four P’s and hired young Don Drapers to come up with pithy copy that would sell their products. It was all about careful product positioning:
“There isn’t any significant difference between the various brands of whiskey, or cigarettes, or beer. They are all about the same. And so are the cake mixes and the detergents, and the margarines…The manufacturer who dedicates his advertising to building the most sharply defined personality for his brand will get the largest share of the market at the highest profit.”—David Ogilvy
This is when the creativity of marketing really blossomed—along with the three-martini lunch—and marketing and advertising became the most exciting parts of working in business. Cary Grant, playing an adman in an amazingly fitted suit, summed this up well in the film, North by Northwest, when he said to his secretary, “In the world of advertising, there’s no such thing as a lie. There’s only expedient exaggeration.”
This was also the era during which two burgeoning technologies—television and computers—began to play a heavy role in marketing strategy. The first television advertisement in the U.S. aired in 1941: Bulova featured a plain picture of a watch face centered on an image of the U.S., and a voice over stated, “America runs on Bulova time.” The whole thing lasted 10 seconds. This would, of course, drastically change things; it propelled companies to start creating “content” that was separate from their products. In no time at all, short jingles and animated characters that represented companies (as Ogilvy said) in a memorable way made their way onto the air and became the staples for many television campaigns.
Bulova aired the first television commercial in 1941. It was only 10 seconds long, but it opened up the world to marketers.
Computers, too, were introduced during this era. Now, for all but the largest advertising agencies, computers were prohibitively expensive. But whether they installed room-sized mainframes from IBM or subscribed to data from “computer services,” the idea of using computers to segment target audiences and provide smarter strategies to reach customers flowered during this era.
THE MARKETING COMPANY ERA: 1960s–1990s
During this era, the focus was on the product. The question was always, “how do we sell the product?” But if you’ve w
atched Mad Men, you’ve probably noticed the ongoing conflict between Don Draper and his clients on how to develop something more meaningful than just “selling the product.” In one episode, Don tries to come up with a new campaign for the new Kodak technology that will show slides.
“It’s not a wheel. It’s a carousel,” he says. “This device isn’t a space ship. It’s a time machine.”
It’s this movement—to deeper, and (hopefully) more meaningful branding—that marks the transition from the Marketing Department Era into the Marketing Company Era.
In the late 1960s and 1970s the world became more global, and more complicated economically and politically. In turn, companies realized they had to stand for something more.
During the Marketing Company Era, the emphasis was on the brand of the company itself. What did the company stand for? As the decades progressed, the growing practice of being meaningful to the customer, and being “customer-focused” rather than “product focused,” was challenged (for the first time) with the mass fragmentation of audiences. Cable television entered the home in the late 80s/early 90s, and due to the company-brand focus there was a shift toward niche marketing and target marketing to audience segments.