Posted on: Thursday 10th of September 2009
I’ve just outlined an agenda to ‘reinvent marketing’ in my Marketing magazine blog.
Its key points are as follows.
First, there’s a win-win at the heart of marketing: when organisations apply knowledge and resources to supply individuals with products and services that are better quality and/or cheaper than these individuals can provide for themselves.
But then there’s an additional layer of persuasion, where things start to get adversarial. Unfortunately, a lot of time, effort and money ends up getting invested in this adversarial side of marketing. Its underlying features are:
Goal Marketers’ job is to help their organisations make money by changing consumers’ attitudes and behaviours in their brand’s favour (the persuasion paradigm)
Method The way they do this is by issuing stimuli designed to elicit the right responses – the changes in attitudes and behaviours they want.
Metrics They measure success by comparing the state of affairs before our campaign/initiative with after.
Underlying philosophy Value extraction; extracting as much value from ‘the market’ as possible.
People disagree about many of the details of this model – as to whether the best or most ‘effective’ stimuli are rational or emotional, conscious or unconscious, for example. But dig a little deeper and they all agree on the basics: The marketer issues a stimulus. The consumer responds. And success happens when the consumer responds in the right way.
The problem with this model is that it is codswallop, both theoretically and practically. The alternative model looks something like this.
Goal The job of marketing is to make money by helping individuals make and implement better decisions.
Method The best way to do this is by eliciting information from them about their needs, circumstances, plans, preferences and priorities and to act on this information in a value adding way (Volunteered Personal Information, in other words).
Metrics The challenge in metrics is not to understand our own ROI in isolation to that of our customers, it’s to identify the biggest win-wins. Focusing obsessively on your own ROI without knowing whether you’re creating a genuine win-win is not clever, it’s dangerous.
Underlying philosophy Value exchange; win-win.
At the moment however, this is just a thesis. We’re pretty damn sure it’s got the basics right but there’s an awful lot to flesh out to be confident enough to change strategies, tactics and so on. That’s why we’ve decided our next round of research will focus on consumer (or, to be more exact, ‘personal’) decision-making, and how it’s changing.
• What does a good decision look like from the individual’s point of view (and how does this vary from individual to individual and circumstance to circumstance)?
• What does a good decision-making process look like from the individual’s point of view (and how does this vary from individual to individual and circumstance to circumstance)? Here, we need to pay attention to the economics – costs and benefits – of decision-making.
• How do individuals actually make decisions? (Here, we need to get up to speed with new discoveries in social, behavioural and evolutionary psychology and neuroscience, while picking our way through a minefield of confusions laid by off-the-wall 20th century economic and psychological theories such as ‘rational choice’ and behaviourist ‘stimulus-response’ conditioning and learning.)
• How are individuals’ decision-making processes changing as the Internet changes the economics of researching and implementing decisions?
• How are these changes affecting organisations’ value creation, value delivery strategies and go-to-market strategies?
• Given everything above, where are the biggest untapped opportunities; the new win-wins?
If you want to know more about this research, or get involved, get in touch!