Decades ago when the Internet was for eggheads and “online” meant chat rooms on AOL and Prodigy there was a place called “the WELL” where the early digerati debated weighty issues of how the inevitable future of ubiquitous digital connectivity would alter society. A rich one regarded the future of marketing – more specifically a new concept called “digital marketing” which would eventually replace all other forms.
One side – let’s call them “the idealists” – argued that the Internet would one day develop into a “perfect information market” (see Adam Smith) in which consumers, armed with total accurate and relevant knowledge about all products would rationally choose the products that offered the best value for their needs. The knowledge would be generated and validated by a global society of connected consumers and it would be indexed by a search engine that leveled the playing field for all contributors. All this would naturally marginalize any partisan agency that tried to slant or distort the record. In such a world successful companies would naturally redirect their bloated marketing budgets to research and development, confident that the best product would win, and competitive differentiation would shift from promotional tactics to quality, value, and innovation.
On the other side were the “skeptics” (like me) who argued that, in a virtual market with billions of aisles and connections and more sources of information than anyone could deal with, brands and marketing would be more important than ever as overwhelmed consumers reverted to familiar names and logos. We also argued that such a system would always be corruptible by finding the right people to pay for endorsements and links.
Naturally, the wisest were somewhere in the middle, and here we are. Yes, there’s something to the argument that social networks and search engines have exposed and blunted the most misleading forms of marketing and given consumers an unprecedented collective voice and mobilization capacity (see Clay Shirky). But that hasn’t exactly translated into an opportunity for the corporation to cut marketing down to a research function and just let the marketplace speak for its products. On the contrary, digital marketing today means in some sense attempting to establish individual dialogs with every customer and prospect out there – across multiple channels both social and mobile – which is in many ways a far more costly and risky proposition than mass media ever was.
“Promotion” is giving way to “engagement” and companies are struggling to make that scale using the unwieldy and often unfamiliar tools of big data and real-time analytics driving automated multichannel processes. Looking back, did any of the old world media gurus predict this? Well, how about Marshal McLuhan who wrote in 1964, “under electric technology the entire business of man becomes learning and knowing…and all forms of wealth result from the movement of information” (Understanding Media)…that now looks like a pretty good call.
What do you think?