Servant of Chaos

Trust is Up for Financial Services’ Connected Consumers

While the retail sector continues to flounder, the Financial Services industry seems to finally have cottoned on to the digital business opportunity presented by social media.  A new report published by ING shows that frequent social media users (ie that lucrative and market-making early adopter segment) view social media as being as reliable as other online media.

Moreover, social media goes beyond simple information dissemination. The report indicates that “financial information posted on social media changes opinions, preferences or behaviour more often”. Clearly, as we have noted previously, our connected consumers are discovering, debating and deciding what to purchase and when independently of our marketing funnel.

Financial services leaders will increasingly need to develop and execute strategies that reach, engage and transform their relationships with their connected consumers. The impact has been felt in 2012, but the power will grow through 2013. Is your company ready?

How ClickFrenzy Became a ClickFizzer

It should have been a raging online success for Australian retailers – a pre-Christmas event bringing together hundreds of local stores to create an online marketplace unrivalled in Australia’s digital history.

The aptly named ClickFrenzy was designed to kick start the holiday purchasing season with an Australian flavour – with local retailers aiming for a greater slice of the estimated $16 billion spent each year online. It appeared to be a match made in virtual heaven – retailers with full warehouses and consumers waiting with wallets fattened off the back of low unemployment and stable economic growth. What could go wrong?

Like Any Failure, It’s Not About the Technology

When the ClickFrenzy servers went down minutes before the 7PM launch, Facebook and Twitter exploded with frustration. But the seeds of this failure go back years. 

For decades the retail sector has been under-investing in technology. Despite having international eCommerce startup superstar BigCommerce sitting on their doorsteps, most Australian retailers steadfastly resisted committing to the online purchasing experience. Some of the largest of retailers launched  poorly designed digital stores with clunky and outdated user experience, limited product lines and pricing models that were less than sharp. The excuses are many and varied, but at the heart I believe it’s a case of the The Innovator's Dilemma – retailers past success has created the obstacles preventing them from succeeding in the face of changing markets and technologies.

Retailers Were Blindsided by the Connected Consumer

Over the last couple of weeks I have been speaking a lot about the disruptive impact of technology. The Connected Consumer has transformed the landscape and outflanked most brands. They are discovering, debating and deciding what they will buy well ahead of the traditional marketing funnel.

Retailers may have seen this change taking place but have not undertaken the transformation in strategic thinking, execution and delivery that is required. They did not dig their well before needing the water. They did not follow the most basic of customer centric models (see below).

The Good News – Retail Now Has a Burning Platform

As I suggested recently, the under-investment in technology by the retail sector has been possible because there was no “burning platform”:

People still bought goods – especially appliances and larger items in stores, and “online” was considered risky, unreliable, and difficult to navigate when it came to returns, warranties and customer service.

Many retailers in the past have made many excuses for poor online execution, appalling digital strategy and non-existent or simplistic social media engagement. I am half expecting to see the same again.

But Australian retailers should wake up and smell the smoke. It’s time for a dramatic rethink from the ground up. It’s time to delve deep and understand the fundamental transformation that has taken place in consumer markets and to work with the disruption in a way that transforms the nature of retail. It’s time for digital marketing transformation.

Funnel Conversion: Make it About Your Customers

It’s one thing to have a marketing insight, but quite another to do something valuable with it.

Living as we do with an abundance of data, what marketers increasingly need is a way to filter the information, distil it for insight and apply their business and brand knowledge in a way that creates value for both the business and their customers.

But where do you start?

Eloqua has compiled 40 infographics covering a swathe of marketing disciples from the back office to the front of house. There are charts on analytics and marketing automation, social media, email marketing and lead management.

Armed with this data:

• Consider your own marketing challenge
• Find a chart that speaks to your problem
• Compare and contrast the chart data to what you know about your business

Now … think about how you can close the gap or solve your challenge. Do you need help? Resources? Budget? What can you do within the next three weeks and what can be delayed until 2013?

STOP.

All this makes perfect sense. But before progressing, consider how this plays out with customer experience in mind. Which of your priorities also provide wins for your customers? What does it mean to recast your efforts through the lens of the customer?

With an abundance of data we can easily lose sight of our customers. Marketers must continue to maintain focus not on their marketing processes but on the constantly changing customer landscape. If you aren’t focusing on your customers, rest assured your competitors are.

The Shift from Mobile First to Mobile Only

Every year the mobile marketing industry boldly announces that THIS will be the “year of mobile”.

In 2005, Sony Ericsson, O2 and Samsung added new features and capabilities to their mobile handsets, delivering 2Mb cameras and GPS to blur the lines between the personal digital assistant and the cellular phone. It was the year that BlackBerry conquered the world and the Apple iPhone was still two years away from it’s game changing launch.

Mobile Device Saturation Outflanks Marketers

Over the last seven years much has changed. But perhaps the most astounding change is the near saturation levels of mobile phone usage – not just in the US, Australia or Europe, but globally. The World Bank reported in July 2012, that mobile phone access now reaches 75% of the planet’s population. And Google Trends reveals an unprecedented surge in mobile marketing interest.

And yet the question remains – how ready are enterprises for the demands of a mobile-ready world?

Marketers have been slow to adapt – first to the web and then to the mobile. Consumers (ie 75% of the global population), however, have not, embracing every new wave of mobile innovation with open palms. The World Bank report suggests that rather than petering out, the "mobile revolution is right at the start of its growth curve”.

Digital Disruption: Lessons from Asia Pacific’s Digital Trajectory

Asia Pacific is not just an economic juggernaut – it is also a petri dish showcasing the consumer behaviour and business impacts that are being wrought by the shift to digital. And while many enterprises have begun to respond with a “mobile first” strategy – designing customer experiences around the mobile device, our trend report on digital disruption suggests that this may not be enough. For many consumers, the future of digital may not involve a desktop computer at all. Mobile first may not be enough – it’s time to consider what it means to have a web experience that is mobile only.

For marketing leaders, there are five key lessons that can be drawn from Asia Pacific and applied to any market:

1. The Internet experience is mobile with a social heart.
2. Consumer adoption is disrupting patterns of media consumption and transforming the buyer’s journey.
3. Digital adoption will drive marketers’ thirst for mobile solutions.
4. Marketers will turn to marketing automation to scale execution.
5. The shift to digital requires a re-casting of the marketing funnel.

Download a copy of the report to learn how mobile and social adoption will change your market strategy.

Driving Retail from Digital to Destination

• The marketing funnel has imploded under its own inadequacy
• Marketers must respond to the shift to digital with the 5 Ds of consumer engagement
• Analytics is essential to understand the path to conversion

For decades, Australian retailers have under-invested in technology and online innovation. After all there was no “burning platform.” People still bought goods – especially appliances and larger items in stores, and “online” was considered risky, unreliable, and difficult to navigate when it came to returns, warranties and customer service.

But then consumers connected. Reviews helped identify quality products. Reputation management allowed online merchants to demonstrate their credibility. And web experiences improved. Prices were better.

People talked.

And kept talking.

Those conversations shifted from sites to platforms. They happened in places far away from the brand police and customer service teams. They proliferated on sites like Twitter, Get Satisfaction and Facebook.

But just as the connected consumer shifts digital channels in the blink of an eye, taking the conversation with them, so too can brands follow this consumer lead. Those with a considered and well executed strategy can connect the dots and drive retail from digital to destination.

Marketers should develop three practices to drive retail from digital to destination:

1. Understand the 5 Ds of Consumer Engagement: The marketing funnel has imploded under its own inadequacy. It’s time to understand the buyer’s journey from the outside-in. Following the 5 Ds allows marketers to understand, map and engage their connected consumers at key stations on the buyers journey
2. When it comes to content and channels, don’t think ONLY think AND: It’s time to break down the silos. Based on the 5 Ds, marketers must begin to work with strategic omni-channel (or multi-channel) formats. This means understanding how content, interactions and engagement work at each station – and where digital can extend or augment an experience (digital or non-digital)
3. Know and measure your path to conversion: Don’t fool yourself that all conversion must happen in-store. Make it easy to purchase anywhere – after all, mobile is the ultimate impulse device. But understand that in-store is now about controlling the brand experience. Ensure that the destination experience is worth the journey in. Use omni-channel analytics to measure and understand the path to conversion.

Now, take a moment to view this (now finished) campaign from Adidas NEO. What’s the customer experience? What’s the journey? And what’s the engagement strategy at play?

Now, how would you play this out with your brand? Be creative.

 

Mobile Disruption Catches Retailers Off-guard

We are now deep into the last quarter for 2012. Marketers are pre-occupied by two challenges – planning for 2013 and preparing to launch Q4 campaigns designed to close out the year on a sales high.

Innovation in the customer buying journey has, however, changed the game. We are all retailers now and the ground has already shifted from beneath our feet. Google Retail’s recent report on consumer shopping confirms what we have known for some time:

• The connected consumer sees no distinction between online and offline shopping
• The connected consumer discovers, debates and decides on purchase ahead of the marketing funnel
• Trust drives conversions

Marketers have failed to keep pace with consumer led innovation

While there has been some investment in digital technologies, and campaign experimentation over the last nine months, there has been precious little innovation where it counts – in marketing practice.

Six principles to transform your marketing efforts

Our recent big idea report on recasting the marketing funnel for consumer engagement identified six principles that must be addressed:

1. Fragmentation creates silos not synergies
2. The marketing funnel assumes a passive customer
3. The next-gen customer experience is owned from the outside-in
4. Next-gen customers purchase in their own time frame
5. Purchase decisions occur before consumers reach your marketing funnel
6. Trust is the currency of digital marketing

Marketers must prepare for the most social holiday retail season now

The 2012 holiday season is primed to be the most social ever. And in terms of “social”, read “mobile”. The Deloitte Dawn of Mobile Influence report on mobile retail reveals that mobile already influences significant in-store purchases and this is predicted to accelerate through 2016. This shift is a global phenomenon as our upcoming report 5 Lessons from Digital Asia Pacific’s Digital Trajectory shows, with mobile innovation efforts garnering 100 million+ audiences across the region.

To outcompete in your markets, retailers must move quickly to identify and fill gaps in the customer experience journey. To counteract this mobile disruption, retailers should:

1. Re-cast the marketing funnel in terms of the buyers journey
2. Look to software-as-a-service providers to fill the technology gap quickly and effectively
3. Consider whether your digital (mobile and social) marketing really does focus on customer need across the buying cycle (answer the WIIFM question – does it get me made, laid or paid) and recalibrate accordingly

Your POV

Are your retail efforts up-to-speed? Are you ready for the social holiday season? Add your comments or send us an email.

Please let us know if you need help with your digital strategy efforts.  Here’s how we can assist:

• Assessing social business/digital marketing readiness
• Considering new digital strategy
• Developing your social business/digital marketing  strategy
• Designing a data to decisions strategy
• Create a new vision of the future of work
• Deliver a new customer experience and engagement strategy
• Crafting a new matrix commerce strategy

Why a Facebook Only Strategy is Doomed to Fail

Facebook’s recent decision to shut down The Cool Hunter’s Facebook page should have sent shivers down the spine of every marketer. For years the vast scale of Facebook has attracted brands like a moth to the social media flame. Promising TVC-like reach with the added benefits of interactivity, community building and interest-graph targeting, it seemed that Facebook was the answer to the prayers of digital marketers the world over.

But a Facebook only strategy is doomed to fail:

• Facebook is well-known for changing their terms and conditions without consultation. If you are not on top of those changes you can find yourself in breach and at risk of being shut down
• Many brands run competitions on their Facebook pages without understanding the restrictive rules for doing so – see particularly Item E (iv) about the use of the Facebook “Like” button as a competition entry mechanism. Again, transgression could see your page shut down
• Facebook is a walled garden designed to keep interaction and activity firmly on the inside. If you are going to the trouble of engaging your connected consumers, building your community and deepening the brand relationship, you run the risk of being “Cool Hunted” and losing that entire investment if you are shut down
• Facebook, while large in scale, is only one social network. Digital marketers should be aiming for quality of engagement and deep next gen customer experience over “reach”

Three steps to reclaim your digital strategy

Facebook can still be a useful (and powerful) platform – but it should be part of your strategy to drive marketing and business outcomes. For example, it should not BE your strategy. There are three steps you can take to reclaim your digital strategy:

• Use a continuous digital strategy. In a digital world, strategy is not “set and forget”. Following a proven approach to set, refine and extend your digital strategy provides deep resilience in the planning and execution of your strategy
• Strategy drives decisions. You must have a clearly articulated and documented strategy. It should provide a guiding principle. “Share the Message, Own the Destination” will not only drive the content and conversational approach, but will also inform your technology choices
• Use technology to scale. While social media offers one-to-one communications, this cannot scale in a business context. There are a range of technologies that can assist you to scale the execution of your strategy. This topic is the focus of my future research, be sure to subscribe for updates.

Asian Connections: Embracing the Digital Trajectory

Fifty four percent of the world’s population lives in Asia. That’s 3.7 billion people. And according to We Are Social, Singapore’s recent report, Asia is home to over 1 billion internet users – 80% of whom use social media (see full report below).

The numbers are impressive. And yet, they tell only part of the story.

The most compelling aspect is the trajectory of digital consumption across Asia:

• New internet users every month: 11,350,000
• Videos watched (in June 2012): 45,000,000,000
• New Facebook users each month: 10,000,000
• Mobile internet users now outnumber PC-based internet users in China: 388 million vs 380 million

Consumer Adoption is Disrupting Patterns of Media Consumption and Impacting the Buyer’s Journey

The shift to digital in Asia is characterised by the widespread use of mobile and smartphones. Almost half of the people in Asia are willing to make transactions on their mobile phones (43%). And 60% of internet users in Asia use social media to inform purchase decisions. This combination is impacting not just the top end of the marketing funnel but various points across the buyer’s journey. 

Digital Adoption Will Drive Marketer’s Thirst for Mobile Solutions

Given that more than half of Asia’s population is under 30, marketers seeking to engage these high spending, younger audiences will need to develop new digital approaches.

However, with 82% mobile penetration across Asia – and a growing population of mobile internet users - digital approaches should increasingly follow a Mobile First with a Social Heart strategy.

Marketers Will Turn to Marketing Automation to Scale Execution

While digital and social media marketing promises one-to-one conversations with customers, the rapid growth in the population of “Connected Consumers” challenges marketers’ capacity to scale. As a result, marketers will begin turning to marketing automation vendors to provide personality rich brand communications at scale.

The Shift to Digital Requires a Re-casting of the Marketing Funnel

While the information in the We Are Social report focuses on Asia, we are seeing similar shifts in markets the world over. Marketers can no longer rely on past practices as a relevant method for predicting future outcomes. Forward thinking marketers will need to begin rethink their understanding of their consumers from the outside-in. This will require a re-casting of the marketing funnel.

Look for my upcoming report CMOs: Re-casting the Marketing Funnel for Consumer Engagement, available for free later this month to all Constellation Research clients. Want to know more? Email me.

We Are Social’s Guide to Social, Digital and Mobile in Asia (2nd Edition, Oct 2012) from We Are Social Singapore

Go Where Others Don’t - The Digital Newsroom of Medecins Sans Frontieres Australia

There is a lot of talk about brands becoming publishers – as if it was a simple transformation achieved by the stroke of a budget making biro. But what does it really take?

In Australia, Medicins Sans Frontieres or “doctors without borders” aim to put this to the test.

Médecins Sans Frontières is the world’s leading independent organisation for medical humanitarian aid, providing relief after natural disasters, helping victims of conflict and running emergency feeding programs. Working in war zones much of their work happens far from the eyes of the world.

And while MSF are known as a “below the radar” organisation – this poses real challenges for sharing stories, building awareness and engaging with potential sponsors, donors and the interested public.

For the month of October, MSF TV aims to address this challenge head on, creating a digital newsroom to bring stories directly to the public. There are:

• Seven channels of video content aimed to stimulate conversation
• Conversations amplified through the #msftv hashtag on Twitter
• Live updates and headlines from around the world
• Interviews from those on-the-ground
• Hosted debates on Facebook and on MSF TV
• YouTube channel with an archive of episodes and issues from the MSF TV site

The rise of digital opens new opportunities for brands to go peer-to-peer

Marketers generally think in terms of business-to-business or business-to-consumer communications. But the rise of digital has changed the landscape. It’s not one-to-many but one-FOR-many communications. The old B2B and B2C distinctions are crumbling under the weight of social media – with communicators now working in a peer-to-peer conversation.

Very few organisations have followed this path thus far. It’s complicated, challenging and exciting. MSF and their partner agency, Republic of Everyone, are trailblazing. They truly are going where others don’t. But we can only expect more to follow.

Invisible Digital is the Force for Next Generation Branding

Next Generation Branding Happens from the Outside In

Apple does it. Amazon does it. Nike does it. Google does it too.

All are ranked in the top 50 of the 2012 BrandZ most valuable global brands report. Yet even within this exclusive collection of brands, some stand out from others. It’s not just that they encompass all that represents a strong brand as suggested in the report – “innovation, trust, reputation, responsible citizenship” – but something far more important. They are brands that exist from the outside in – brands that are created by the consumer experience that radiate back towards the company.

And they achieve this through the innovative use of digital strategy.

Apple’s Innovation: Invisible Digital

The excitement around the launch of any Apple product is palpable. From the first iPod through to the latest incarnation of iPhone, Apple has mastered the art of slow burn communication. There are various “leaks”, glimpses and mockups that find their way into the online world. Rumours of impending announcements are made and message boards, blogs and social media sites explode in anticipation. Meanwhile, the retail experience is perfected – employees are briefed and educated, supply chain is primed and inventory is delivered. And often, as in the case of the iPhone 5, the announcement is simply an exercise in expectation setting – it’s a pre-announcement of an announcement, a pre-launch of the launch. After the announcement, products can be pre-ordered online, ready for delivery or pick up after the launch.

It’s a carefully orchestrated strategy designed to prime the market and maximise sales. It is an experience that uses digital to connect the dots – from expectation setting through ordering to delivery. And yet, it’s a digital experience that does not call out its existence. At almost every touchpoint, customers experience a sense of digital innovation without the accompanying sense of interruption or dislocation. It’s digital that is invisible.

• Invisible digital drives footfall: Retailers understand the importance of footfall – of having people physically in your stores – and Apple is no exception. But while many retailers struggle to drive people into store, Apple can orchestrate vast queues of people to line up for hours just to pick up their new device. Sure, these customers could choose to have their iPhones delivered to their home, but that would exclude them from a very public ritual that is beamed by mainstream media around the world. Orders may be placed online, but fulfilment (in all its senses), is delivered in person.
• Invisible digital orchestrates engagement: Apple chooses not to actively participate in social media, ploughing their efforts into activities which create remarkable experiences for their customers. Whether it is an ad hoc visit, a reservation at the Genius Bar or the excitement of picking up  a new device, the free WiFi at the Apple Store ensures that customers can create conversations around this experience, taking photographs, blogging, sharing and tweeting.
• Invisible digital casts a brand halo: When we purchase a product or service we are investing a small amount of our reputation into a brand. And as we use that product or service there is a cross-halo effect that takes place – we share our own reputational glow with that brand and the brand, in turn, reflects upon us. Invisible digital allows this to happen seamlessly – and with each micro-interaction, the personal and public brand becomes ever more closely aligned.

The Bottom Line: Invisible Digital Sets the Stage for Next Generation Branding

Google claimed top ranking in the 2007 BrandZ report with Apple well down the list at 16th. It seemed at the time that Google were unassailable. Five years later, they are ranked 3rd behind IBM, and have suffered a 3% drop in their brand valuation (with a brand valuation that is only 60% of Apple’s $182 million). The need to innovate is relentless, but innovation must not focus on technology alone. Innovating the customer experience must become a priority for brands and invisible digital may be the key.

Invisible digital is not about technology in the traditional sense. The technology simply enables a flow that transports customers from one experience to another. The touchpoints, the interactions and ultimately, the aggregation of experiences creates next generation brands. Some brands understand how this works. Others must accelerate their efforts and investigations or risk falling further behind.