Andrew Frank

A member of the Gartner Blog Network

Andrew Frank
Research VP
5 years at Gartner
30 years IT industry

Andrew Frank specializes in best practices for data-driven marketing, including how organizations can use data to drive sales, loyalty, innovation and other business goals. Andrew also specializes in marketing and advertising technology and business trends …Read Full Bio

As Social Media Matures, It Reveals Its Dominant Media Genes

by Andrew Frank  |  July 7, 2014  |  3 Comments

Have you noticed that the voices of social network utopianism are quieter lately?  Facebook’s secret mood experiment didn’t help the idealist view – nor did COO Sheryl Sandberg’s apologetic acknowledgement that Facebook’s actions were merely “poorly communicated.” But I think it would be a mistake to read this as simply another in a long line of privacy glitches Facebook is famous for – and invariably moves beyond. This is part of a definite and predictable pattern involving not just Facebook but all social media, now mostly run by public companies, whose true natures as commercial businesses are emerging to dominate the treasured user illusion of a “people’s medium” like Wikipedia. I know that sounds cynical, and please don’t get me wrong – all media must appeal to an audience by offering compelling experience, and Facebook’s audience is the largest and most engaged ever assembled – a truly global community – and there’s absolutely nothing wrong in my view with monetizing it through advertising. In fact, as Google has proven, like it or not advertising is the prevailing business model for nearly all massively popular eyeball-attracting experiences, no matter how techie the roots; when social meets media, it’s the media genes that dominate.

dnaThere’s an important cultural implication here. Facebook (unlike Twitter) filters news feeds algorithmically – this is its equivalent of an editorial voice. Looked at this way, using its algorithms to manipulate people’s emotions is not so different than using drama to do the same thing – except that we expect this from drama (or should, anyway). So now we know: expect this from social media as well. It’s in business to serve advertisers. That means consolidating influence. Our version of the truth has always been subject to economic forces – now, the mechanics of influence are more intelligent, but it’s still the content that grabs us and holds us, even if it’s filtered news from friends mixed with ads.

Which is why Facebook just spent a reported $400-$500 million to acquire LiveRail, a video ad tech company connecting marketers with publishers to target 7 billion video ads per month. LiveRail is hooked into mainstream media – it counts media companies such as ABC, CBS, Univision, A&E Networks, MLB, and PBS among its customers – and Facebook says it will use its data to help improve the targeting of video ads. This comes on the heels of Facebook’s announcement of its Audience Network service in April, which lets advertisers extend mobile campaigns beyond Facebook’s social network – using the same targeting as Facebook’s native display ads, including Custom Audiences. So Facebook is no longer a separate continent competing against the mainland of the web for attention and ad revenue – it’s now, like Google, AOL, and Yahoo, part of the larger ecosystem of advertising that can follow and target consumers wherever they may roam – even to mainstream media sites and apps.

Meanwhile, remember “earned media?” According to some experts, it was going to make paid media obsolete. Facebook’s taken care of it. In its youth, the social network allowed brands to reach their fans – which could number in the millions – just by posting. This led to a massive exercise in fan base building and elevated the “like” to metric status. Now it’s not so easy. Facebook has taken to throttling commercial posts so that only a small percentage of unpaid posts make it through to followers’ newsfeeds. Another example of editorial control through algorithms – in this case, boosting Facebook’s bottom line by charging brands for audience reach the old-fashioned way.

I could go on: Twitter’s purchase of TapCommerce, a mobile ad retargeting platform, fits the monetize-audience-first picture, alongside Namo and MoPub. (SnappyTV is a bit more nuanced.) But here’s the bottom line: as disruptive as companies like Google and Facebook are to traditional media, they’re not killing the ad business. They’re using data, analytics, and huge global audiences to make it more competitive – but, as Gartner’s recent survey confirms (subscription required), advertising is not going away.

 

3 Comments »

Category: Advertising Data-Driven Marketing digital marketing Disruption Media Uncategorized     Tags: , , , ,

The Empire Strikes Back

by Andrew Frank  |  June 25, 2014  |  Comments Off

Aereo’s defeat in the U.S. Supreme Court looks to me like part of a trend of legal setbacks for the latest wave of digital disruptors. The company got farther than any of its predecessors in taking on the status quo of broadcast television, but in the end the high court essentially rejected the premise that innovative technology could make its service compatible with the law.  It’s not that the tech wasn’t cleaver enough to comply with antiquated statutes – the problem, the court conceded, was that the business was at odds with the law’s inferred intent. This is a hard lesson for disruptive innovators.

The Aereo case was more than just a victory for the incumbent broadcasting business: I believe it marks a turning point where digital disruption suddenly appears more vulnerable to legal reprisals than it’s seemed at any time in the past two years. Consider some other disruptors. Airbnb is in the process of upending the travel industry. The company has grown 750% since 2009 and recently secured $450 million in funding at a staggering $10 billion valuation. But in NYC, it’s under fire for allegedly abetting illegal behavior. The drawn-out conflict is a lawyer’s dream come true, but in a telling recent development, after initially resisting prosecutors, Airbnb agreed to hand over its customer data to the state attorney general. As Airbnb struggles to change NY State’s Multiple Dwelling Law and move other big rocks, landlords, co-op boards, and hotels are bristling at what they see as the service’s indifference to their rights as property owners and regulated taxpayers.

Then there’s Uber. It’s $17 billion valuation is even larger than Airbnb, yet, according to Justin Kintz, Uber’s policy director for the Americas, it faces regulatory issues in the 128 cities where it operates. In one recent sign of friction, it and its chief competitor, Lyft, were banned in the state of Virginia. Cities in general have given them problems: Uber has been targeted by protesters in Boston, Miami, San Francisco, Washington D.C., and Paris, where strikes have turned violent.

Which is not to say that either of these companies face a future nearly as doubtful as Aereo. But potentially disruptive businesses share the common trait that laws and regulations are often obstacles to their existence or success, even when those laws failed to anticipate what the Internet might make possible. This insight often seems lost on those of a technocratic bent who assume that law, like code, is a system to be debugged. When they discover things often don’t work that way, their reaction is often to accuse opponents of adopting, as Ashton Kutcher put it, a “Mafioso mentality.” There’s seldom acknowledgement that disruption has its victims too.

As these legal battles play out, there’s a corresponding debate going on in intellectual circles about the fundamental role of disruption in business strategy. The source of contemporary thinking on the topic is often identified as Clay Christensen’s famous 1997 book, The Innovator’s Dilemma, which spawned an entire business philosophy dedicated to disruption. His Harvard colleague Jill Lepore recently took on Christensen and his philosophy with a bold rebuttal in The New Yorker entitled The Disruption Machine: What the Gospel of innovation gets Wrong in which she rebukes the idea that disruptive innovation “[holds] out the hope of salvation against the very damnation it describes.” Christensen offered a pointed redirect in Bloomberg Businessweek (he calls her piece a “criminal act of dishonesty”), and the story is well covered by Karen Webster in Pymnts.com’s To Disrupt or Not To Disrupt: Is That Really The Question?

What does this have to do with marketing? Here are a few quick take-aways:

  • Beware of digital disruption’s all-or-nothing rallying cry. Ideas don’t need to be destructive to be valuable. Review Nielsen’s recent Product Innovation awards and ask, how disruptive were these winning ideas? Most of them simply discovered and satisfied unmet consumer needs.
  • If you’re a marketer whose business is being threatened by a disruptive competitor, consider who else is being disrupted. Don’t assume that disruptors are always good at marketing. Disruptors aren’t always perceived as heros.
  • And always remember: disruptors themselves are also vulnerable to disruption. You can create your own Aereo with a DVR and an antenna (here’s how) – it’s usually better to find ways to fill consumer needs with services that are legal than to take on the system, whether it’s City Hall, the State House, or the Supreme Court. Unless, of course, you’re a lawyer.

Comments Off

Category: Advertising Cloud digital marketing Disruption     Tags:

Adding Depth to Customer Experience

by Andrew Frank  |  June 10, 2014  |  1 Comment

When 3D TVs made their big push at CES back in 2011 I was among the skeptics. Lack of programming was a huge barrier of course, but mostly it was the glasses: not just too expensive, clunky, and unreliable (the active types at least), but for me there was something else: they were too flagrantly techy to gain mainstream appeal. I had the same reaction when I first saw Google Glass: I thought, techies may be driving the device revolution, but many have a distorted view of how much nerdy affectation most citizens will comfortably adopt. Beats and bracelets may fly, but I think society draws the line at tech covering our eyes – at least for now.

Industry-watchers have known for a while the name of the solution: autostereoscopy, a.k.a. glasses-free 3D.  The technology works – for the most part it’s awesome, although there are still some viewing angle issues – but the main problem has been cost. This is now coming down into the range where, although still expensive for home and personal use, retail and other environmental applications are becoming more feasible.  You may have seen the press release circulating about the “Fallingwater” Exhibit featuring Rembrandt 3D; these types of announcements are picking up frequency: Tianma NLT America recently added eye-tracking to its device to deal with viewing space issues, Zecotek Photonics is promoting its 3D breakthroughs, DDD Group allows even 2D tablets and smartphones to display in 3D on 3D TV devices, and a host of others featured solutions at the recent Augmented World Expo in SF.

2008-09-07_autostereoscopic_3dlcd_monitors_3

http://3dcinecast.blogspot.com/2008/09/autostereoscopic-3d-lcd-monitors.html

Of course all of this begs the question, what’s in it for marketers? Well, as overused as it is, I can’t escape the word “engagement” here. When a message departs from the screen surface and fills the air in front of you, it engages a different part of your brain.

I was won over by a demo of SeeSpace InAir by co-founder Dale Herigstad, an Emmy-award winning TV interaction designer who’s been chasing such dreams for decades. InAir drove home the design possibilities inherent in adding a third dimension (along with simple gesture-based controls) to a display, to create layers of interactive content (delivered via the Web) that can completely change the way marketers and designers think – not just about display case merchandising, but about space in general. SeeSpace calls this “augmented TV” – and it works with any television, but 3D is better, and glasses-free TV is where it’s all headed.

So the next time you find yourself pouring over a spreadsheet or trying to make sense of a dashboard report, take a break and check out the future of marketing: it’s in the air. And it’s closer than you might think.

1 Comment »

Category: Uncategorized     Tags:

60 Minutes Takes On Data Brokers

by Andrew Frank  |  March 11, 2014  |  5 Comments

Steve Kroft’s segment on CBS’s March 9 installment of 60 Minutes, “The Data Brokers: Selling your personal information,” was a noteworthy chapter in the escalating confrontation between the data-driven marketing industry and popular press initiatives to expose the alarming aspects of our emerging surveillance society.  (Also see the Direct Marketing Association’s response.)

The introduction framed the problem with a hint of irony:

“Over the past six months or so, a huge amount of attention has been paid to government snooping, and the bulk collection and storage of vast amounts of raw data in the name of national security. What most of you don’t know, or are just beginning to realize, is that a much greater and more immediate threat to your privacy is coming from thousands of companies you’ve probably never heard of, in the name of commerce.”

The exposé format demands a clear moral indictment of the culprits – and Steve isn’t shy about naming names – but there’s irony in the suggestion that new government regulations are needed to reign in these companies – despite the reference to “government snooping” and other evidence that Americans trust their government even less than commercial enterprise. Epsilon President Bryan Kennedy tries to play this point but seems to fall into an apologist trap:

“Steve Kroft: You’re saying that any kind of regulation on this could cripple the economy?

Bryan Kennedy: I am.

Steve Kroft: And this should be left to industry groups? To self-enforce?

Bryan Kennedy: We think that self-regulation has been very effective. What we’re hearing today is a lot of discussion in Washington. We’re not hearing a lot of discussion, frankly, from consumers. It’s one of the odd things. So, consumers are rushing to the Internet to provide more information about themselves than, you know, we would’ve ever imagined.”

Kroft briefly references the proposed legislation of Senate Commerce Committee chairman Jay Rockefeller, but avoids the snarls of discussing the technical and political challenges of regulatory remedies, except near the end when he refers to the Direct Marketing Association as “one of the most powerful lobbying groups in Washington.”

I will say that, to an outsider, there was plenty of highly damning testimony. The worst came from Tim Sparapani, identified as a former privacy lawyer for the American Civil Liberties Union, then Facebook’s first director of public policy. (This, too, might seem ironic, although Facebook and Google were both spared direct indictment in this segment, “because they don’t sell the information they gather about us. They keep it all to themselves.” Try to parse the irony in that.)

“Steve Kroft: What about medications?

Tim Sparapani: Certainly. You can buy from any number of data brokers, by malady, the lists of individuals in America who are afflicted with a particular disease or condition.”

Anyone who has heard of HIPAA should know this is illegal in the U.S., as are most of the other practices Sparapani mentions. That doesn’t mean they don’t happen – although their alleged prevalence would seem to be as much an indictment of law enforcement as anything, given the claim that “the evidence is there if you know where to look.” More insidious, however, is the implied guilt-by-association this assigns to the mainstream data marketing companies the piece identifies. Although Kroft stops short of criminal accusations, there’s no attempt to distinguish among data practices – especially when it comes to the particularly sensitive area of personally identifiable information – and he doesn’t hold back on shady insinuations against mainstream data brokers.

Federal Trade Commissioner Julie Brill is a bit more careful about this. Watch her tiptoe around the PII issue:

“Steve Kroft: Are people putting this together and making dossiers?

Julie Brill: Absolutely.

Steve Kroft: With names attached to it? With personal identification?

Julie Brill: The dossiers are about individuals. That’s the whole point of these dossiers. It is information that is individually identified to an individual or linked to an individual.”

Any insider will immediately recognize this language as an attempt to avoid getting dragged into a discussion of the technical nuances of PII. But the cost of avoiding that discussion is that we remained trapped at the level of innuendo. Marketers use third-party data of the sort that most “data brokers” provide not so much to identify individuals, but to reach a specific audience. The individuals who comprise that audience don’t need to be uniquely identified…until they reveal themselves to the marketer in the context of a commercial relationship. Otherwise they can remain anonymous. But the segment doesn’t delve into how mainstream marketers use data.

When it comes to identifying the harm inherent in this kind of marketing surveillance, journalists seem to have two choices:

  • Invoke a direct connection with crimes such as identity theft and blackmail
  • Invoke more intangible and sinister consequences such as covert discrimination and subtle forms of coercion and manipulation

Kroft avoids the simplicity of the first and leaves us with the second, which, to my mind, is a real long-term social problem. But it’s not a problem that can be easily addressed by the remedies that reactive legislation can provide.  Nor can the industry unilaterally address it through self-regulation and cryptographic technology – although their extensive attempts to do so might have merited at least a passing mention. Consumers need a partner in this.

“Commissioner Brill is pushing for more oversight and transparency. She says people should be able to see the information the companies have on them, be able to challenge it if it’s incorrect, and opt out of the system if they don’t want personal data collected.”

Amen. Maybe she’s talking about Acxiom’s aboutthedata.com – or a more-comprehensive future version. In any case, superficial consumer controls and notifications can’t replace an actual understanding of the highly complex forces and technologies at work here. There are certainly better technical solutions to consumer empowerment (think agents), and a number of entities in a position to deploy them (banks, CSPs, the data brokers themselves) but without market demand they will not materialize. The identity theft protection industry struggles to get people to pay for a more concrete value proposition. Privacy is an economic puzzle that most marketers want to solve as much as anyone.

So, maybe just scaring people is the right place to start. If so, I guess Steve Kroft and CBS have done their duty. But I’d watch that line between illumination and vilification.

5 Comments »

Category: Advertising Data-Driven Marketing digital marketing Uncategorized     Tags: , ,

The Campaign to End All Campaigns

by Andrew Frank  |  February 28, 2014  |  2 Comments

To campaign or not to campaign, that is the question on a lot of digital marketers’ minds these days. Mike Volpe, CMO of Hubspot, is among those who believe that “the notion of the marketing campaign is dead.” And he’s far from alone.

But for those of us of a certain age – especially if we were raised on Madison Avenue – the idea that “the campaign is dead” is bound to bring a smirk – didn’t Chiat Day run a campaign like that in the early 90s?

And yet we secretly wonder, what if it’s true? What if there really is a better way? This is a crucial question – whose outcome could permanently alter the practice and economics of marketing. A few weeks ago, my colleagues  Jennifer Beck and Jake Sorofman aired a faceoff on the topic. Here’s a quick recap of their debate, with commentary:

Sorofman,Jake 1:01 PM
Campaigns are as good as dead.

Beck,Jennifer 1:01 PM
Well, let’s first define things. What do you mean by a campaign—before you pronounce them dead?

Sorofman,Jake 1:02 PM
I see it as a concentrated, time-bound promotional effort to drive some change in demand or selling motion. To me, it’s an inside-out, brand-centric concept that puts the marketers’ interests first.

Me: Notice how Jake sets up the post-brand-centric communications aesthetic where marketers’ interests take a back seat to addressing customers on their own terms. Point one: people don’t like to be pitched, and now that they have more choices they’ll be more likely to engage with personally relevant messages.

Beck,Jennifer 1:03 PM
I think of campaigns in gaming or military terms—as a connected series of battles, adventures or scenarios. Think of military campaigns. Take that hill, secure the city, push forward on the front—they all feel like marketing maneuvers geared up to open a new market, retain customers or grow revenue. The analogy works, marketers have been using the lingo—guerilla marketing, under the radar, competitive win back, and the like for ages.

Sorofman,Jake 1:03 PM
I agree with that the structural aspect of campaigns remains valid—logical linkages between goals, themes and efforts. But in an age of abundant choice, engagement needs to be centered around what the customer cares about, not what the brand cares about.

Beck,Jennifer 1:04 PM
[...]You know – all this talk about empowered consumers, engagement, experiences, trust, loyalty, affinity—blah, blah, blah—every company I talk to is trying to make money.
So herein lies the challenge of balance.
What brands need, what buyers want.
You need to satisfy both.

Me: When in doubt, follow the money. Counterpoint one: if you completely suppress brand interests, your marketing will be ineffective (no matter how engaging it is). You need balance.

Sorofman,Jake 1:05 PM
Actually, I don’t think these ideas are mutually exclusive, but marketers need to break out of campaign thinking to become better brand storytellers. I don’t see this as the death of sound, focused business practices, where marketing efforts are tied to sales outcomes; but I don’t think campaigns alone are sufficient, particularly when they’re used as the grist for social engagement. I think the best campaigns have more authentic storytelling extensions and storytelling itself also must happen apart from these campaigns.

Me: The sound you hear are the cheers and jeers of the ghosts of soft-sell advertising, who preached the power of storytelling when they walked the Earth decades ago.

Let’s break for an insightful reader comment:

Derek E. Weeks: Jake, you seem to capitulate on the topic … So, campaigns are not dead — they just need to be extended in new ways. A point that we all (you, me, and Jennifer) agree on. I think the point you are trying to make is that marketers can be more effective by stepping out of their traditional campaign comfort zones and adding in new social, storytelling, and content extensions.

Me: “The news of my death is greatly exaggerated…” Point 2: Campaigns might not be completely dead, but they represent a limited way of thinking.

Sorofman,Jake 1:17 PM
[...] …if you focus all of your effort on driving near-term customer behavior through traditional campaign tactics you’ll exhaust your customers. Engagement also needs to be less directly about the CTA; it’s also about building dialogues which influence preference and loyalty through trust and affinity that you nurture over time.

Beck,Jennifer 1:18 PM
Can you have a storytelling campaign? The goal is brand extension perhaps?
It would be like that movie – The Never-ending Story.

Sorofman,Jake 1:20 PM
In a sense, yes, but most content marketers would call these themes, not campaigns. Because campaigns, right or wrong, place the emphasis on the brand, not the audience. Semantics, yes, but I think there’s a real danger of content marketers forgetting to play the longer bet on the customer when they think of what they do as a campaign. But these themes are often time-bound and driven off of a calendar, which makes them campaign-like, I suppose.

 Me: And so we are led to what we’ve taken to referring to as “Two-speed marketing.” In a subsequent blog post I added,

“…when individuals seek to form or modify relationships, clearly their interactions take different forms. A first impression is a one-time opportunity, and people are motivated to make it count. Whether it’s dating, a job interview, a major speech, a big sales presentation, or a marriage proposal, we all strive to make the most of our big moments. Brands are no different: whether it’s a new product launch, a shift in direction, a seasonal special or even an attempt to answer for a disaster, there will always be moments in the life of a brand that call for “campaign thinking” – that is, preparation, orchestration, and careful measurement – and maybe, in the digital world where messages reverberate and take on a life of their own, these moments are more important than ever.”

My colleague Marty Kihn added:

“I think there’s also an economic argument in favor of campaigns. Consumer brands often launch new products, line extensions, etc., and the most efficient way to do so at scale is via mass media (e.g., TV, homepage takeovers, big Facebook campaigns, etc.). Such media are simply too expensive to continue indefinitely (“always on”), so they’re used in bursts, which we call campaigns.”

Counterpoint 2: The scale and impact of a campaign is hard if not impossible to achieve on a continuous basis.

Conclusion: Campaigns may not be dead, but they’ve mutated and now need to co-exist with content marketing in a two-speed system where both modes complement, compete, and play against each other.

Come celebrate the modern campaign with us as we embark on a week of examination of the old king in his new (digital) clothes (subscription required)!

2 Comments »

Category: Advertising digital marketing Media Uncategorized     Tags: , ,

The Story of Ad Tech

by Andrew Frank  |  February 26, 2014  |  1 Comment

The announcement of Oracle’s acquisition of BlueKai brought me to the realization that the story of ad tech, and how it went from antagonist to ally of the software megavendors, is not so well known outside the insider’s clique. This has created some challenges in interpreting this event. So here it is – my take, anyway – in suitably condensed form.

It all started when Google’s search engine first struck advertising gold, spawning the ad tech gold rush that’s been picking up steam ever since. As digital ad spending grew, a rift opened in Silicon Valley between the maturing IT-centric software providers and the young digital media rebels. As the IT world focused its gaze and efforts toward the clouds, ad tech proceeded to develop its own sub-culture, complete with a new language and value system, inventing and appropriating terms like “data management platform.” This one in particular confused and irritated many IT leaders who saw data management as settled territory whose relation to advertising – an “application” – was at best obscure. Analysts passionately debated this terminology. But the trade had spoken: DMP became a fixture near the center of the ad tech universe, connecting data and media in a constellation of acronyms from ATD and DSP to RTB and SSP.

It wasn’t just the IT world that was rattled by all this: the traditional media and advertising worlds, as well, were often caught up short by these developments, especially as they started to attract real media budgets and disrupt well-established ad marketplace practices with alternatives like real-time bidding exchanges. In spite of resistance, media budgets follow the eyeballs and the arc of the marketplace bends toward efficiency, and so ad tech continued to attract investors, customers, and talent, to the point where media and advertising had little choice but to embrace and try to direct the movement. Ad tech companies, eager to counter charges of comprising a second dotcom bubble, accommodated them by accepting some of the old ways, such as using television-style metrics to measure media rather than the native digital ones they started with. They invented media-friendly formats like native advertising. Jeff Zucker gradually revised upward his “analog dollars for digital pennies” exchange rate to quarters and rising.

As this was happening, the software megavendors, recognizing that marketing was shaping up to be a key consumer of big data and cloud services, went on a marketing provider shopping spree, buying up marketing automation and social marketing management start-ups at eye-popping valuations. But – with the exception of Adobe – they largely avoided ad tech, to the point where nervous investors started to look to IPOs as the exit strategy for ad tech – with a healthy mix of disappointing and home run results (here’s a nice summary by Luma Partners).

Somewhere along the line, the ad tech vendors made an important discovery. In solving the problem of how to best target and trade display ads in real-time, they’d actually solved a much bigger problem that’s bedeviled marketers for some time: how to effectively apply data to optimize their marketing operations in real-time. They realized the algorithms that could optimize display ads sold on real-time exchanges could also optimize email, the web site, mobile communications, even the call center and direct mail. They also realized that, although they’d focused initially mostly on third-party data collected in cookies, by combining this with their customers’ first party data they could produce even better results. They added better analytics and started to acquire complementary technologies like attribution and tag management (which were also making the same discoveries). This made the software megavendors see them in a new light. They began to realize that ad tech – DMPs in particular – would be a key integration point in the comprehensive marketing solutions they were constructing.

The story doesn’t end here. While we believe that Oracle’s BlueKai acquisition will light the way to a wave of ad tech consolidation into megavendor marketing suites, a few hurdles remain on the way to complete reconciliation. Ad tech is still retains its “Wild West” image, struggling with issues like privacy and fraud. Perhaps as the megavendors bring them on board, they’ll also bring resources and experience to tame these issues and reassure the public more successfully than Google and Facebook. Still, I doubt they’ll ever be comfortable with the idea that a “data management platform” is an ad tech product. Some things are a matter of principle.

1 Comment »

Category: Advertising Applications Cloud Data-Driven Marketing digital marketing Media Uncategorized     Tags: , , , , ,

Getting Closer to Your Customers

by Andrew Frank  |  January 10, 2014  |  2 Comments

Me: Siri, are you “Her”?

Siri: No, but nobody could know you better than I do.

Kudos to Spike Jonez and Apple for nailing the zeitgeist of 2014.

Consider a recent survey called The Rise of the Customer-Led Economy, in which The Economist asked CEOs, “In which of the following ‘value disciplines’ does your organization focus most on excelling? (Customer intimacy, Operational excellence, Product leadership)” Having asked the same question before, they discovered that, over the past three years:

The percent of respondents who answered “Product leadership” dropped from 33% to 18%;

The percent who answered “Operational excellence” shifted slightly from 33% to 37%;

And the percent who answered “Customer intimacy” leaped from 21% to 37% — a rise of 76%.

On one level, this obviously echoes the rise in “customer-centric” thinking as a business trend. But there’s more: customer intimacy is a growing vortex at the intersection of consumer empowerment and big data. The dream of true one-to-one marketing, once thwarted by scalability issues, is now coming into sharper focus through a confluence of technology breakthroughs: connected products, the Internet of Things, the quantified self movement, social marketing, and, of course, advanced analytics enabled by smart machines in the cloud. To be sure, the hype is still ahead of the reality, but now is the time to think about how to navigate an emerging world where more and more organizations seek – and believe they can achieve – customer intimacy through technology. This goal sits right in the center of the nexus of forces: mobile, social, cloud, and information.

To state the obvious, many folks recoil at the word “intimacy” in connection with marketing and commerce. Our collective ambivalence is reflected in our behavior: according to Pew Internet’s research, “86% of internet users have taken steps online to remove or mask their digital footprints—ranging from clearing cookies to encrypting their email.” Yet, we also increasingly trade privacy for convenience, or other seemingly trivial considerations.

This tradeoff will only become more explicit. According Peter Sondergaard, Gartner GVP and Global Head of Research:

“In the second wave of the new digital industrial economy, consumers will shift from being largely ignorant of their data’s value to being highly intelligent, protective and selective about how they collect and manage it.

In this second wave, consumers will be enabled and empowered to own and thereby monetize their own data, effectively wrestling back the control and driving up the value equation for themselves.”

This will open a chasm between winners and losers in the customer intimacy landscape. Clearly, digital marketing strategy and tactics are the keys to determining which side you land on as consumers cull the overabundance of suitors seeking “intimacy.” The first step for many seeking to excel at this will be a realistic assessment of relationship status. It will be difficult to overcome the tendency to assume that intimacy can be won by a superficial combination of more listening and more communication.  Our resolution for 2014 will be to help our customers get to the next level of understanding of how digital marketing, and especially customer experience, can deliver a more empathetic view of relationships. In some cases, this might mean acknowledging when someone’s just not that into you.

2 Comments »

Category: Advertising Cloud Data-Driven Marketing digital marketing Media Uncategorized     Tags: , , , , , , ,

Digital Marketing Agencies Promise Business Transformation

by Andrew Frank  |  December 12, 2013  |  Comments Off

 Is digital marketing leading the digital business revolution, or is it just making the most noise? In support of the former, consider Gartner’s recently-released Magic Quadrant for Digital Marketing Agencies (access it free here). Here we find a gallery of impressive companies, from a wide variety of backgrounds, whose market leaders are distinguished by their business transformation skills.

But how are they at delivering enduring results?

Many disciplines and service provider categories have claims on business transformation besides marketing. Even further: many service providers support marketing besides companies that call themselves “agencies” – a label that, for better or for worse – can’t seem to shake its historical “Mad Men” advertising connotations, despite the inclusion of companies like Accenture, Deloitte, and IBM. But agency culture has many qualities and values that uniquely qualify it for a leading role in today’s digital business transformation story: its reverence for vision and visionaries, its ingrained consumer-centric orientation, its long-standing relationship with data and research, and its commitment to delivering big ideas, to name a few.

There are also areas where that culture causes friction with the real requirements of business transformation. Specifically, there’s the growing importance of the discipline of technology implementation in the digital agency business.

Certainly, the pure-play digital agencies have always had a strong technology story, and even the ones with pure advertising heritage have come a long way in their relationship with technology. The many digital agencies with system integration backgrounds are certainly no strangers to complex implementation. But our interactions with agency clients over the past several months suggest that, as a group, digital agencies still generally do better at the vision part of business transformation than the delivery part. We’ve heard stories of roll-outs described as “catastrophic failures” and “way over budget” with “poor communication” and “inexperienced developers.” To be fair, leading agencies generally do a consistently good job of handling execution. Still, it’s worth noting that it’s much rarer to find complaints about digital agencies failing to deliver great ideas than great results.

Some might take that as a sign that digital agencies should stick to vision and creative execution, and leave complex implementation to the experts. This approach has its success stories; its problem, however, is that it results in difficult hand-offs with accountability problems and generally slows down a process that is already under a great deal of time pressure. Moreover, agile development, which embraces changing requirements even late in a project, requires visionary leadership throughout the process – not just at the outset.

Agencies have a legacy of recognizing and rewarding top talent in the creative sphere; in the technology sphere, talent is in high demand and the call of Silicon Valley can be hard to compete with. Lacking a promise of IPO wealth can be a disadvantage, however agency market leaders are still finding ways to attract and retain this talent, which may become easier as the next wave of consolidation plays out among tech companies. For digital agencies, tech talent – alongside data science – is becoming an increasingly important differentiator. As more companies look for help with their digital business transformation, these companies are positioned to transcend their promotional legacies…but some still need to transform themselves first.

Comments Off

Category: Advertising Data-Driven Marketing digital marketing Strategic Planning     Tags: , , ,

Campaigns vs. Content Marketing: A Relationship View

by Andrew Frank  |  December 10, 2013  |  1 Comment

Last week my colleague Jake Sorofman wrote of The End of the Marketing Campaign, a view that I’ve since heard echoed in a few places. Here’s another perspective.

I think it’s clear that digital is changing the nature of almost every stalwart of traditional marketing. At the same time the time-honored objectives and language of marketing – customer acquisition, branding, cross-sell and upsell, loyalty and retention, advocacy, and so forth – endure in a world of changing tactics. Which begs the question, what is the new equilibrium of marketing tactics that we’re all approaching in the digital world?

I’d like to propose the hypothesis that the ultimate goal of digital marketing – in fact, of marketing in general – is to establish a more natural relationship between brands and individuals. Yes, the real goal is to sell, but this is best accomplished in the context of a relationship that echoes our primordial instincts to do business with people we know and trust and to be wary of offers from strangers. This forms the impetus for content marketing and brand storytelling: these are efforts to establish a familiar, natural role for brands in the digital marketplace of human interactions.

So does this mean campaigns are becoming outmoded? This depends on how you define “campaign.” If a campaign is any sort of planned, time-bound concerted effort to make or change an impression – at scale - then I doubt they’ll ever go away. Here’s why: when individuals seek to form or modify relationships, clearly their interactions take different forms. A first impression is a one-time opportunity, and people are motivated to make it count. Whether it’s dating, a job interview, a major speech, a big sales presentation, or a marriage proposal, we all strive to make the most of our big moments. Brands are no different: whether it’s a new product launch, a shift in direction, a seasonal special or even an attempt to answer for a disaster, there will always be moments in the life of a brand that call for “campaign thinking” – that is, preparation, orchestration, and careful measurement – and maybe, in the digital world where messages reverberate and take on a life of their own, these moments are more important than ever.

Time in the spotlight has long-term implications – in many cases, defining brand perceptions for years to come. On the other hand, the quotidian world of casual communication is also a key aspect of natural relationships within communities and families. The theme of continuous storytelling supports this long-term analog of natural social relationships (at much smaller scale). To excel at communicating, people need to be adept at both forms of communication, and so do brands. If your branding practice is trying to use the machinery of campaign management to drive your daily dialog, you may well need to rethink your approach. But as you do, don’t allow the burdens of real-time presence to obscure the opportunities to think big. Small talk is no substitute for planning a few special moments for people we care about.

1 Comment »

Category: Advertising Data-Driven Marketing digital marketing Media Strategic Planning     Tags: , , , ,

Real-Time Marketing Gone Wild

by Andrew Frank  |  October 25, 2013  |  3 Comments

One thing about a real-time marketing: it’s a lot more entertaining than the canned stuff. Who doesn’t enjoy watching a venerable brand get mauled by the Twittersphere trying to hijack some news story or social buzz?  These days, even a flop affords the opportunity to boost engagement with a heartfelt mea culpa.

RTM’s Vaudeville nature certainly has its detractors. But, as my colleague, Richard Fouts, points out (subscription required), it’s not as though it’s optional: RTM is an unavoidable consequence of the world we now live in (most of us, anyway): always on, always connected, always trending. If you’re not part of the conversation, you’re not part of the community, so abstain at your peril. Richard also makes the crucial point that real-time marketing is not just about putting out fires or latching on to trends; it’s about defining the processes that empower people to act in a deliberate manner that appears spontaneous in a real-time context  That’s a lot more difficult than it looks. Unfortunately, because success gives the illusion of true spontaneity, it’s become something that’s both easy and tempting to imitate badly.

How can we tell the difference? In many ways, real-time marketing appears filled with contradictions. As part of the digital marketing story, it often seems to defy the story’s themes of efficiency and accountability and attribution. Although we can point to measurable performance tactics like real-time offers and real-time pricing and real-time distribution (oh yes, and real-time bidding for media) – most of the efforts we encounter resemble hit-or-miss attempts at creating impromptu brand impressions, to be superficially measured by likes, shares, followers and retweets. Where is all this going? Is there any science to it?

This leads back to the old question of how to assess indirect marketing activities, with the new twist that real-time dynamics, despite generating more data, are less predictable than ever. The complexity of opinion flows in social networks and their effects on real business metrics like sales and loyalty are still mostly beyond the reach of big data analytics to assess – and maybe they always will be. But that doesn’t mean you shouldn’t try. You may discover something interesting. In the meantime, plan carefully for RTM, but consider the words of Thomas Edison: “Just because something doesn’t do what you planned it to do doesn’t mean it’s useless.”

3 Comments »

Category: Advertising Data-Driven Marketing digital marketing Mobile     Tags: , , , ,