Convergence Is The 'Next Big Thing' For Marketers
I spent the last two weeks in (somewhat) closed-door events tailored to marketers and innovators. The more private events were events hosted by Ascendant Network, who held their Summits for rising Retail and Digital leaders. The semi-private event was VentureBeat’s first GrowthBeat Summit, aimed specifically at the CMO crowd. At these events, execs discussed the challenges they face circa 2015, and the their approach to tackle them. While the past year or two was steeped crafting a digital strategy, the several types of disruptive convergence they face capture the latest theme best:
- The convergence of online and offline shopping. Back in 2012 I predicted our collective arrival in an era of post-digital marketing, in which cross-channels strategies trump digital channel-specific efforts to match customers’ behaviors. Shopping is now facing a similar fundamental shift. Take the example of Google Express or Amazon Same-Day Delivery. Should they be counted as online sales because that is where the transaction is initiated? Or are they actually offline sales, because the goods are bought and delivered from physical stores?
- Consumer media behavior cuts across screens, not within them. On a similar note, what is TV today? SlingTV delivers the TV stream and related ads to either a big TV screen or an iPad in a controlled experience, but it is not officially a linear TV stream. Does that count as digital or linear advertising? Does mobile video support a digital ad unit, or should it counted as video? Add in the display or pre-roll ad on a mobile device, and the discussion quickly shifts to a debate on the definition of TV vs. video. And for the record, I think its time to ignore Mary Meeker’s “time spent” valuation of media (see slide 16 of her presentation), and focus on where the cost of advertising and the resulting engagement and action, not time. Otherwise the 20 hours that consumers spend on Facebook would indicate that the company should be able to swallow TV budgets whole, but that is not the case.
- The issues of data privacy and security. One big debate that blew up twice over dinner conversations at the aforementioned events was the issue of security vs. privacy. While they may be separate issues – security is technical and describes the protection of private data, while privacy leans towards the rules that govern the active use of data – consumers don’t know or care about the difference. In a recent Pew Internet study, they found that 93% of consumers state that being in control of who can get information about them is important, and 90% say that controlling what information is collected about them is important. Yet it was the security breaches where credit card terminals were hacked at Target that brought an end to the tenure of a number of execs at the retailer.
- The perception challenges of targeting and personalization. The “creepy” factor of retargeting and highly personalized advertising is going through a similar convergence. Defining an experience that is intentionally valuable to unique consumers is the role of new personalization tools from start-ups and the tech establishment alike. But the issue of privacy goes on high alert when the targeting strategy that is appealing and action-inducing has to simultaneously not be overt or overstep privacy bounds.
Building a Convergence Strategy I can’t say that these issues were resolved over dinner or these conferences. And oft-mentioned issues like staffing and measurement are foundation elements that are the cost of entry for making more complex strategies successful. Here are some of the actions that presenters offered as solutions to this converged new world:
- Rebuild the business starting with the consumer. Two well-known multichannel retailers showed this small audience their plans for turning the entire company -- including store operations, supply chain, and marketing -- on its side, shifting from silos of marketing and merchandising to strategies defined by customer sets, then executed by each channel with appropriate marching orders. Regardless of product set, starting with the customer and their sensitivities, needs, and receptiveness to messages is a great way to cut down on the clutter and risk of a misstep.
- If it's a big idea, it requires guts and a plan. Convergence is going to happen, because consumers do not divide their decisions by technical or operational limits. Taking a risky bet, whether that is to go 100% programmatic with media buying, removing check out counters from a store or covering the walls with RFID-laced paint to track consumers in and around the dressing room, even using augmented reality to engage the audience, helped these companies leapfrog competitors with a blend of traditional and digital-only thinking. To make these bets requires confidence, a model for how to monetize the investment in data, and a plan for how to handle unintended consequences. For example, when it comes to data protection, PwC insists that CMOs get more involved in the discussion of how to balance the benefits with the risk factors.
- Staff convergence with change agents. Toeing the party line makes change slow. Brands and stores that need to take a strong stand to rejuvenate their brand need to be bold to get marketing activations to cross the threshold of online and offline actions. One brand I met rethought the role of content for their company, using the journalistic metaphor of a newsroom to accelerate the timeliness of their messages – shifting the pace to minutes, not hours or days. This effort, led by marketing and media executives and teams of young ideators, allows the brand to be on top of any event related to their brand on local or global scale.
Is convergence an issue for your company? Where are you seeing worlds collide? Comment here or add to the conversation on Twitter @minicooper