When you consider the astronomic amounts Kim Kardashian and Selena Gomez get for their Instagram posts, it becomes only too apparent that marketing has changed drastically in recently times (Hermans, 2017). But the fact half a million dollars are paid for a sponsored message, is only the tip of the iceberg. There is more at play here than simply the advent of influencer marketing. Moreover: this sector will change even more drastically in the coming years than seems possible right now. Exciting times, if you embrace change. If you miss these changes, then you cannot be surprised if your company is overtaken by the competition.
Let us pause and consider the definition of marketing and a short explanation about what has changed in recent years. Then I will take you to the imminent, and distant future of marketing, communication and sales.
What is marketing?
Wikipedia describes marketing as: Marketing is an economic science that is based on the English terms market and getting and relates to all activities that a company carries out to advance the sales of products or services. Traditionally, marketing is seen as the whole of all activities which are focused on, together with the sales department, the advancement of the exchange of products or services. This exchange-based description has been considered too limited by the American Marketing Association from their first revised definition in 2004.
We actually learn two things here: marketing allows companies to sell more products or services– and the sector has been changing since 2004, because the old definition no longer suffices.
From Don Draper to data-driven
There is an iconic series about the advertisement industry, one that every marketer has to watch once in their life: Mad Men. Main character Don Draper takes you back to the 1960s for the duration of seven seasons, when the advertisement industry was still controlled by cowboys and opportunists.
Mad Men was the nickname of the advertising men on Madison Avenue in New York and is of course a play on ad men and the word mad. If you do not simply watch the series to witness the gigantic social differences (such as the lack of women’s emancipation), then you will see a difference in the area of marketing. Only rarely, if ever, is anyone asked if a campaign pays off, nobody is evaluated based on performance and creativity seems to trump effectiveness. The series cultivates the image of the artist and creative advertisement professional.
How different is that from now? Where artistry and creativity were the fuel of the 1960s, data is the gold of the 2010s. Data allows you to target advertisements on social media and even pay per click on an advertisement or message. The advertisement industry came up with the Effies, one of the most prestigious Dutch marketing awards, to acknowledge campaigns which are also genuinely profitable. These days, growth hackers use intelligent and constant experiments to allow a company to grow and in doing so replace traditional marketers. The only thing that may make one reminisce about the days of Draper are the well-organised parties in the advertisement industry.
Three horizons and a target
This is where we now stand. The benchmark moment: increasingly more companies are aware that they want to, and must, use data to get ahead. They are working on their digital transformation and see technology-driven contenders enter their market. They really want to accelerate, but do not succeed. A number of things are needed for this. A route for the coming three years and a target on the horizon.
In this case the target on the horizon is the BHAG — Big Hairy Audacious Goal. This term is used by James Collins and Jerry Porras. They suggested in their ‘Built to Last: Successful Habits of Visionary Companies’ book that organisations that had formulated a BHAG performed much better than organisations who did not do this. It concerns BHAGs who appeal to the imagination and are formulated in a challenging way.
Examples of successful BHAGs are:
- We put a man on the moon and will bring him back safely this decade (John F. Kennedy, 1961);
- We crush Adidas (Nike, at its foundation, back when Adidas was market leader);
- In 2020 there will be no fatal accidents caused by Volvos (Volvo).
This is the BHAG that I have formulated for this publication:
“In 2021 we know and recognise all our (potential) fans and clients within the digital ecosystem and we are able to automatically communicate with them to optimally maintain the relationship to meet the needs of everyone within the ecosystem.”
How do we achieve this BHAG? By keeping three horizons. The ‘three horizons framework’ was originally published by Baghai, Coley et al (2000) and since then has proved to be an important model for growth, change and innovation within organisations. Using three horizons, you can describe which phases organisations or industries will experience.
Control over digital assets
The first horizon focuses on the present. The framework. Many organisations have a blind spot at ‘the back of the organisation’. That is a pity, as this is actually the part of the organisation which will prove to be the most important. This is where the digital assets — an important part of the financial valuation — of the company are located, and you can gain control over this. The insights about Spinnin’ Records, Martin Garrix and Armin van Buuren’s Armin Only show what organisations will have to do today.
How can you gain control over your digital assets? For this you must optimise your event and ecosystem in a data driven way. You have to use a framework. This framework includes the entire digital change of an organisation and lets your ecosystem grow digitally, by making smart use of data. I will discuss this further later.
First machine learning implementations
The second horizon focuses on the imminent future: 2020. The acceleration. If we look at the technological revolution that is underway, then we see that there is an unrivalled amount of information available for analysis and action. Every Facebook post or like, every bleep of a supermarket scanner and every flickering light from a medical aid can be read and analysed. Therefore, it is potentially a valuable source of information. The possibility to automatically explore this valuable information, looking for the not so obvious connections, is called machine learning.
In my vanAnaloognaarDigitaal.nu book, I quoted Mike Gualtieri, an analyst at Forrester Research, who provided this pragmatic definition of big data: ‘Big data is the ability of a company to store data, process it, and provide access to that data, which allows the company to work more effectively, make decisions, reduce risks and serve clients’.
This is a good workable definition. A small note: the term big data — just like the term social media — is an umbrella term. When big data reaches its adult phase, the term will simply be called data again and will be the most ordinary thing in the world. Similar to how the terms e-mail and website became part of everyday life.
I expect this to be the case in 2019. Automatically recognising patterns will be a fact. Organisations will then make use of artificial intelligence and machine learning. As of 2019, data will be an umbrella term; a tool that assists organisations to manage and accelerate their business.
To conclude, the third horizon. At the end of 2020, early 2021, marketing will slowly but surely start to be managed automatically. The end game. Chatbots, such as those from Hardwell, will be the most normal thing in the world. In addition to chatting with these bots, you can also listen to music. Ordering tickets and merchandise are everyday things. Automatic analyses and decisions using a framework is part of the job for every organisation in every industry.
It all sounds like an objective that appeals to the imagination and is formulated in a challenging way, right? This is therefore my Big Hairy Audacious Goal that I will be working on in the next two years. In my opinion, we are not that far away from this. If we look at various initiatives, then we see that such aspects have already found a place there. I am convinced we will be there around the start of 2021. That is why it is now time to speed up and to delve into the way in which marketing will change in the coming years.
- This post is a pre-read of Part 1 — Chapter 1 of my new book ‘Digital Assets’ the translation of the Dutch publication ‘Digitaal Vermogen’.
- Also read the publication ‘EDM and the Digital Domain’