March 26, 2018
By Wolfgang Kaller, Managing Director, RAPP Asia-Pacific Japan
Rapid changes in customer behavior, today’s competitive landscape and technological advances are drastically shifting marketing activities and ROI for the world’s biggest brands.
In the early days of marketing, when demand was greater than supply, product design and production engineering were the most important sales contributors.
Soon thereafter, mass production became a well-oiled machine and, as such, communication was chief in a market landscape filled with mass quantities of comparable products.
With a limited number of channels – and clearly defined customer touch-points – it was brand personality and big creative idea that added the most value to companies. Their underpinning organizational structures were static and silo-based, with a clear hierarchy and order, as products and campaigns’ life cycles were on two ends of the spectrum – painfully long or too abrupt. Agencies’ structure mirrored this – a defined process beginning with the account team, through to planning, then creative, in order to churn out big campaigns.
It was arguably a very efficient way to collaborate and accomplish the end goal but, these days, this way of doing things is often seen as the challenge to overcome. What has changed?
The proliferation of social media channels, search capabilities, online video, millions of webpages, e-commerce and even TV, itself, has turned few into many; a static customer journey into a fluid one; some information into millions of data points. Our average consumer has transformed into a potential media source, creating a highly fragmented landscape. More and more products and brands are largely defined by what consumer or cultural trends make of them and/or how they’re perceived and judged by buyers.
Additionally, we are witnessing shrinking product life cycles that are much more dynamic. Even in the most traditional industries, like automotive, we’ve shifted from an old model, of seven-year launches, to annual ones with regular updates, via 4G, in between. If marketers and brands are going to not only survive, but also thrive, we must consider the following:
- Business models: We’re seeing a product shift into service-and-subscription models, where a device and its components encompass the entire product offering (e.g. healthcare, computers and automotive). And we’re seeing an organizational shift, where companies are beginning to take several of their key functions, like data analytics, content creation or design, in-house in order to keep the most value. This requires companies to re-think their value offering to customers and re-engineer their structure/expertise accordingly.
- Structure: To attract and retain the best talent and save costs, there is a need for total transparency, easy collaboration, automation and smart systems that nudge colleagues at the right time and let them collaborate from anywhere at any time. This requires organizational re-structuring, underpinned by modern software solutions.
- Insights: A shift away from traditional market research gave way to real audience testing and first-party data analysis and modeling. This requires investment in data-management and analytics as well as new processes to test new ideas and go to market.
- Marketing: Brands are moving from big campaigns to personalized, always-on messaging – based on values and big ideas, but divided into many tailored micro-campaigns. Doing so efficiently and effectively requires agile and quick to execute in-house agencies or close partners.
By now, brands and marketers, alike, have realized that shoveling money into big ideas, content or media cannot alone solve these challenges. And that’s the whole point: what sets apart modern companies and marketing is the smart use of technology based on a clear vision, strategy and pragmatic, human-focused implementation.
If you agree with the four points above, try to consider the actionable steps required to make them happen. You may come to the conclusion that technology drives new business models, enables an agile, dynamic and transparent company structure, sharing of information, live insights/testing of ideas, targeting and the efficient production of high quality personalized content. Coming back to the thesis that our brands are defined by word of mouth, the final outcome of technological applications – like better products, content and service and more efficient employees – might be the most effective way to efficiently control brand reputation.
So, it’s always been said that creativity is king. But where does creativity fit in this new model? I still strongly believe in the power of creativity – but I just argue that its value-add has been leveled due to the rise of other functions. No longer a dictatorship, creativity must be redefined on a case-by-case basis, and applied in a more holistic sense to new business models, products, technology design as well as communication. Creativity has to be applied to solve business problems; not narrowed down to communication only. By embracing this democracy and becoming agile business partners instead of communication experts, modern agencies can create a lot of value.