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State of advertising and company customer interactions 2021

My background in advertising makes this an interesting topic and you will hopefully soon see where the company customer interactions come in. I started out in the ad industry in the 90’s but left it before the turn of the century. My reasoning: the writing on the wall which indicated a gradual decline and irrelevance for the practice, especially at the onset of the technological revolution that was the world wide web. Twenty years later it’s worth pondering where things stand and if I was right in any way.

First just a little more on my views and how I formulated them. I started my career in advertising after first studying for 3 and a half years focusing on marketing management. Soon after finishing I started working at Ogilvy & Mather (O&M), a bastion of advertising creativity, innovation and success. David Ogilvy practically invented modern advertising and was known as the Father of Advertising.

I remember being in thrall of the creative process and how great advertising influenced people, created brands and even transformed industries.

I moved to several other notable agencies after that but soon started to feel an unnerving disquiet. All was not well in advertising land. I became disillusioned at the excesses and the ego’s that often accompanied overly successful creative people (I worked on the business side in account management).

More importantly, email had arrived and I remember how it revolutionised the traditional paper based processes we had in offices at the time. Soon after that, the interwebs. That’s where my mind really started to change.

In the mid 90’s I went to live in London, at the time the centre of the advertising world in many ways, or at least on a par with Madison Avenue, New York. Its also where I got a deeper taste for the interwebs and when I decided to study further, the subject on which my dissertation was based.

I don’t mean to provide a life history in this post so let me jump to the chase of the pertinent piece of that background.

My further study and the subject of my dissertation.

By all accounts the outcome of my dissertation was of interest because I got to present it at a Corporate Communications Conference in Rotterdam. Here are the slides which I presented attached. The full paper is a little more dense so I’ll save you the effort. The hypotheses I was testing is covered in slide 7.

In essence it was that a shift in corporate communication (with customers) was being facilitated by technology and this would lead to certain more positive outcomes for the company. I termed this new shift corporate interaction because that is what the technology was enabling – two way communication from the traditional one way, broadcast style communication that traditional advertising facilitated.

The hypotheses looked like this: Ease and frequency of interaction that a company created with customers using technology (a lot of the tech was CRM at the time which was rising in prominence) would be more appreciated by customers (liked), leading to better relationship formation and ultimately customer loyalty/commitment and purchase on a continuing basis.

I used a structural equation model to test the hypotheses – see slide 8. The essence of the hypothesis was that the more a company interacted with customers, the more highly the company was evaluated and therefore the more suitable the products were perceived to be to their needs. Fundamentally, the more highly they would evaluate products, the more they would ultimately use and continue using them. Pretty much a basis for many SaaS businesses and/or the Customer Success role, although there weren’t any at the time.

I also tested another construct I was really interested in which was customer’s views on how a company’s perceived ability would impact on their evaluation as a company and how that would impact on the product evaluation (in terms of sophistication). But I’ll leave that construct aside for now.

State of advertising

Two great posts on this that do a far better job than I would since I am no longer directly involved with some choice snippets from each after the links:

No one likes ads. So let’s do something about it was written by the CEO of Unsplash, Mikael Cho. His opening volley after that provocative title also says a lot:

Madison Avenue, we’ve got a problem. Creative is dead and the spreadsheets and algorithms murdered it. The bots have triumphed and the result is mind-numbingly dull. “Nobody gets fired for buying IBM,” they used to say. Now, nobody gets fired for buying Facebook ads.
We all know there’s a better way than annoying people. Advertising shouldn’t push against what people want, it should align with what they want. That’s why at Unsplash we’ve decided to build our business on a new model we call Open Source Advertising.
Open Source Advertising: the act of promoting a brand by releasing media (especially images) featuring its product(s) to the public to use and distribute free of charge.
The brands we partner with say it’s like product placement for the internet. Content featuring a brand gets picked up and repurposed by creators, spreading organically across the internet via articles, blog posts, presentations, and social media.

The last two paragraphs also do a rather good job of explaining the alternative and also supporting the premise I explored all those years ago. That is, from broadcast to interaction, involvement, getting people engaged in the process, co-creation if you will. All elements you should see in the slides I shared earlier from my study.

The 5th Paradigm of Marketing Is Emerging. What That Means for Advertisers (registration may be required) is based on shared insights from an interview with Raja Rajamannar, Mastercard’s Chief Marketing and Communications Officer and President, Healthcare.

According to Rajamannar, quantum marketing entails re-examining every single principle of marketing. For example, loyalty programs, a multibillion-dollar expenditure, don’t actually create customer loyalty.
“So, we move away from this whole concept of loyalty, and we turn to preference management,” said Rajamannar. “Every time the consumer is in a position or at a point to make a decision, you as a brand need to be present in a non-intrusive fashion, and you need to be aware of the context of the consumer at that point in time, and you need to be able to nudge the consumer toward your brand—to help them make the choice in preference of your brand.”

So this sets up the first point I want to make about customer loyalty being questioned. Its where I started all that time ago and it seems its still as relevant as ever. There is a video in that article that goes into this very logically and sensibly with an example of loyalty programs and how as customers, we often are members of multiple loyalty programs but remain disloyal, jumping to the one that has the best deals at the time. So they have become nothing more than gimmicks.

He then focuses on technology which is the other pretty fundamental aspect of my initial premise and how it will change things, again. According to Rajamannar, the 5th paradigm of marketing is all down to technology but these are all now new and will take things to the next level.

Rajamannar says we are on the verge of the fifth paradigm of marketing, which will be driven by about 24 different forms of technology, including artificial intelligence, augmented reality, virtual reality, drone deliveries, 3D printing, autonomous vehicles, wearables and more.

The initial technologies in the early part of this century can probably be characterised as social technologies. Although my early views were that these were precisely the kinds of technologies that would revolutionise company and customer interactions to deliver on the promises I was exploring, I think it’s safe to say we’ve not exactly hit the mark.

I’m not sure these new technologies will do that but that’s the point – it’s not about the technology, per se. Technology is just the enabler but the intent behind it is what matters. The intent a company has to really interact with customers and co-create common solutions that truly benefit both.

Company customer interaction – new project

I feel like things and I have come full circle. Worthy of something but I’m not sure what yet. I wouldn’t say its a trend like the others I watch: Trend Watching. So I’ll just call it a project for now – watch this space 👀

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