Technology & the Future of Marketing
Since the dawn of the internet age, technology has driven changes in how we approach marketing. Google revolutionized marketing with their mastery of the search engine, allowing marketers to target their ads based on what people are searching for. Search engine optimization helped build upon this by allowing companies to pay to have their link appear first when certain terms are searched. With the arrival of social media, Facebook provided additional tools for marketers by allowing them to further tailor their ads based on a person’s likes and interests. Currently, we are witnessing the big data revolution in marketing which allows marketers to tailor advertising based on consumer behavior by analyzing things such as credit card transactions. All of these advances in technology have allowed marketing to be much more effective than the old ways of TV and print advertising. But what lies ahead in the future? Which future technologies present an opportunity to further advance the field of marketing, and which technologies present a threat?
Location Based Advertising
It’s no secret that our increased use of mobile devices has provided a tool for marketers to drive content to our devices. With the addition of mobile payment systems like Apple Pay and Google Wallet, companies are able to analyze our purchasing patterns in real-time and push ads to our phones that reflect those behaviors. With iOS 8, Apple introduced the ability for location specific advertising. For example, if you walk into Wal-Mart, your phone will recognize where you are and you’ll receive an ad from Wal-Mart offering a discount or other promotion. By personalizing ads to people based on their location, you are much more likely to show them something relevant. There is no point making blanket offers to people in the hope that they might want what you’ve got. Finding out what they’re interested in and then personalizing your message is a much more effective technique. Location data enables you to do that. You can make offers based on where people are. One of the key advantages of location based advertising is that it is timely. Because location data is served in real time, there is an opportunity for brands to target people at precise moments. Store beacons, for example, tell shops when you walk through their door. This means they can send people offers that are completely relevant to them at that exact time. This allows marketers to be much more efficient than offering blanket discounts to everyone. This ability to offer tailored ads based on location is only the beginning. Augmented reality will allow marketers to take this idea, and expand upon it by allowing users to view ads by simply looking in the direction of the store.
Earlier this year saw the arrival of Pokemon Go, a video game that utilizes augmented reality technology. The game exploded in popularity, and provided a glimpse into the future of augmented reality. So what is augmented reality, and how can marketers utilize it? Augmented reality is a digital overlay of the real world. For example, if you point your phone camera down the street, information will pop up describing the building you are looking at. Juniper Research, a company specializing in mobile data, predicts that AR-paid app downloads, subscriptions, and advertising will generate global revenues of $1.5 billion by 2018. That may not sound like much in the big scheme of things, but considering just three years ago, in 2015, AR brought in less than $2 million in global revenue the industry is growing pretty fast. Augmented Reality is evolving quicker than many ever thought possible. Soon augmented reality will become part of our everyday lives. IDC expects that augmented reality technologies will reach mass adoption levels by 2021. This means that in just five short years, more than a billion people worldwide will regularly access apps, content, and data through an augmented reality platform. This is going to change the way companies can market products. Instead of searching Google for a nearby restaurant or coffee shop, people could simply hold their phone up to see that information augmented onto the street in front of them. This technology can also be applied to print advertising in a way that keeps print relevant in the 21st century. For example, you could point your phone at an ad for a movie and watch as it animates into a trailer for the movie. This also gives marketers the ability to track and measure print advertising because they are able to tell who looks at their ad and how effective it is. Google Glass was an attempt by Google to create glasses that the user would wear in order to receive augmented reality information. The product failed to catch on due to it being a little ahead of its time, but if the technology is refined in the future to where it is no different than wearing sunglasses, then marketers would have the ability to constantly send advertisements to our field of vision. Someday augmented reality will provide an experience in which users may not realize they are consuming paid content. This could be the difference between trying to sell consumers on an experience vs. letting them experience it for themselves. The potential for this technology is incredible, and personalization and targeting is a big one. In the coming years, it will become common for consumers to experience unique augmented reality ads directed at their interests, eye gaze, and location given the right platform. With augmented reality, the world around us has, become a new area to advertise. Advertisers will begin to experiment with ads that can pop out right in front of you, even follow your eye movement, making content much less avoidable than it is now. The crucial part of augmented reality is whether the technology adds real value. Simply overlaying something virtual on a phone screen doesn’t always cut it and can appear gimmicky. Having an ad pop up on your smartphone camera view from scanning a brand’s logo might be fun, but it would probably get old pretty quickly. Similarly, an app that overlays information and promotions on your phone screen when you point the camera to different stores on a street or products in a shop sounds useful, but marketers have to wonder if consumers are really going to walk down the street holding their tablets or smartphones in the air? Do they want to shop by scanning every product? The challenge for marketers will be in finding the right balance between overloading the user with ads, and providing useful information to the user that they actually want.
This ties in with the overall challenge marketers will have in the years to come: not overusing the abundance of data they have in a way that overwhelms the consumer. In 2017, it is estimated that 86.6 million Americans use some form of an ad blocker and 30% of internet users regularly delete their cookies. This suggests a trend in which consumers are growing tired of the constant bombardment of advertisement they receive when browsing the internet. Consumers are becoming more aware of how their data is used to target them, and this makes many people uneasy. The key for marketers as we progress into a time of increased targeting is to create content that adds value to the consumer rather than simply advertising to them. Personalized advertising messages may be of great value for consumers, while at the same time concerns about companies using their personal information may result in negative responses and turn them away. A study last year by Accenture captured this dynamic perfectly. Eighty percent of the 2,012 consumers surveyed from the U.S. and the U.K. in the 20–40 age group believe privacy is a thing of the past. 87%, said that safeguards are insufficient to protect personal information. But even with these perceptions, 49% said they wouldn’t object to companies tracking their buying behaviors if it resulted in more relevant offers. This seems to suggest that while customers are cautious about the amount of data being collected on them, they are willing to let it happen if the tradeoff adds sufficient value to their lives. The companies that place a high value in protecting customer privacy, while also striving to create content that adds value, will be the companies that are most successful in utilizing this new technology to advertise their product and services.
The future for the field of marketing is bright. As technology advances, more and more tools become available to marketers. As more of our devices go online, more data is generated allowing for more accurate targeting of advertisements. Location based advertising, which got its start about 5 years ago, will continue to grow and will become a main method of advertising. Augmented reality will allow companies to make further use of location based advertising by sending visual information in real time to the user’s device. Augmented reality can also breathe new life into outdated forms of advertising such as billboards and print, by allowing a company to measure the effectiveness and engagement level of their ads. But with all these benefits comes some challenges. As consumers become more aware of the amount of data being collected on them, the need for marketers to generate value through their ads is greater than ever. A company can risk alienating consumers if it is believed they are taking advantage of the data they have access to. The key in the future will be creating ads that don’t feel like ads. By taking advantage of technologies like augmented reality, companies can breech that barrier and further target the individual without seeming overbearing.
-Written By Stew Frazier. Stew is a senior at the University of Montana studying Management Information Systems