It remains difficult to find good books about marketing and sales. I decided to give “Quantum Marketing: Mastering the New Marketing Mindset for Tomorrow’s Consumers”. The world that got me was quantum. As was I writing this blog and reviewing my notes, it made me make links to 17 other books. Not bad. The book confirms a lot of previous thinking and puts it all together. Click the links for some more depth.
Marketing is dead
It begins like “Killing marketing” or “The old rules of marketing are dead“. Marketing somehow seems to have lost some of its gravitas, glory, glamour, and glitz. Marketing as an art, science, and craft is in a crisis. A large number of blue-chip marketing companies are fragmenting the 4 Ps of marketing (price, place, product, and promotion) and distributing them across multiple areas outside of marketing. Reducing the role of marketing. Today, there are any number of companies in which marketing does not manage product, does not manage pricing, does not manage place (distribution). It just barely hangs on to promotions, which is advertising and promotions at best. In recent studies, 80 per cent of CEOs say that they have no confidence in their marketing team,1 and 73 per cent of CEOs said their marketing team members don’t have business credibility or the ability to generate growth.
You need to feel sorry for the marketeers. The last five years have seen more change in marketing than the previous fifty.
- We have seen significant changes in the marketing landscape, driven by huge technology transformation, tremendous advancement in data analytics, and changes in consumer behaviour driven by mobile and social media.
- Marketers have not been able to credibly connect business outcomes to their marketing investments and actions. They all should read up on BITS. When a marketer cannot clearly connect the dots between marketing activities and business outcomes or quantify their business impact, they cannot defend their budgets. When their responses to financial questions are in terms of brand awareness, brand predisposition, net promoter scores, and a whole bunch of other important brand metrics, they have lost their audience and their credibility.
- New technologies like artificial intelligence, augmented reality, 5G connectivity, the Internet of Things, smart speakers, wearables, and blockchains are poised to transform consumers’ lives and potentially take marketing’s impact to entirely new levels.
- Marketers have not been able to keep pace with the dramatic advancements in technology and data.
Never has the marketing toolbox been more powerful than now. In the Fifth Paradigm, dramatic new technologies and interaction points will explode into new dimensions. Quantum Marketing is about reframing and reprogramming marketing methods to address and leverage these paradigm shifts.
The First Paradigm of marketing was literal, rational, and almost entirely product-centric. The presumption was that consumers made their purchase decisions rationally and logically. Every brand’s research and development focused on superior product quality, resulting in marginal differentiation and minimal competitive advantage at best.
Marketers, over time, realised something very powerful: people make decisions emotionally, more than rationally or logically. Marketing mined emotions. Focussing on EPO.
August 6, 1991, an arcane information retrieval system known only to scientists was shared with the general public by Tim Berners-Lee. It was called WorldWideWeb. There was no press release. To paraphrase W. B. Yeats, a “terrible beauty”, was born. On October 12, 1994, a digital trade information website called HotWired simultaneously published ads from twelve different brands, including AT&T, MCI, Volvo, Club Med, 1-800-Collect, Sprint, and IBM. Banner ads were created. This was the entry into the Third Paradigm: the rise of the internet and data-based marketing. The new focus became using data to create more targeted marketing, which minimised waste, stretched the dollar, and vastly improved a company’s ROI.
From October 2007 to August 2008, a college-based variation on message boards called Facebook spiked from fifty to a hundred million users, and social media was born. Alongside this, the iPhone was released on June 29, 2007. Four foundational elements led to the birth of mobile phones and devices:
- Exponential increases in processing power.
- The miniaturisation of components and devices.
- All-pervasiveness of an affordable internet.
- A big leap in user interfaces that became highly intuitive.
Always on and always distracted: Social media heaven and hell: The reputation and even the valuation of a company can be made or broken by a single tweet in the Fourth Paradigm.
This era is driven by exponential disruptions (good and bad) in consumers’ lives, caused by a deluge of emerging technologies.
- Infinite data.
- Artificial intelligence (AI).
- Augmented reality.
- Virtual reality.
- 3-D printing.
- Connected and autonomous cars.
- The Internet of Things (IoT).
- Smart speakers.
- Robotics and drones.
The impact on marketing
The concept of loyalty will be completely transformed. Advertising will radically change. Concepts like Quantum Experiential Marketing will emerge. Marketing will be fragmented. Purpose will become an indispensable part of marketing. Ethics and values will gain significant prominence. Trust will be a gigantic competitive advantage.
In the Fifth Paradigm, the mission of a Quantum Marketer has to be fourfold:
- Brand building.
- Reputation management.
- Driving business growth.
- Creating platforms for sustained competitive advantage.
The exact LTV
With the advent of enterprise-wide databases, marketers can exactly compute the lifetime values of their customers across all the relationships they had with the company. This enables them to create relationship-based strategies, as opposed to product-based strategies.
Data is literally an ocean. Descriptive (what happened), predictive (what will happen), and prescriptive (what the dimensions of consumer data are). The sheer quantum nature of data and the speed with which it is being spewed out is mind-boggling. Companies need to rethink their entire data strategies and technology architecture for this imminent future. But this is a key approach in Quantum Marketing—you don’t study consumers and their behaviour. You study and understand people in totality. So, it is critical that marketers don’t anchor their marketing strategies from insights all the way through the entire life cycle, solely on consumer studies and big data. Study people holistically and market to them as people and not as consumers. Humanise all this content without losing the facts their prospects are searching for, but overlay with rich insights from psychology, neurology, anthropology, behavioural economics, and sensory sciences. Read “Small data“.
AI is the ultimate propellant of quantum marketing. Using AI, the company can analyse your past behaviour, your current propensity to buy in the category, and your behaviour in other categories. This analysis is done in real-time, and the company will be able to send you a highly personalised offer that is good for you and great for the company.
- In the Fifth Paradigm, virtual assistants will proliferate, their quality will make a giant leap, and they will become an integral part of marketing channels.
- Through blockchains, marketers can not only get a cost advantage, but they also get the much-needed transparency and accuracy of data.
- One of the tenets of Quantum Marketing is to integrate the power of art, technology, and science to get into the consumers’ heads and hearts.
- In traditional marketing, marketers rely predominately on sight and sound. In Quantum Marketing, they need to address and leverage as many of the five senses as possible. For example, sound, especially rhythm and music, addresses the primal part of the brain, where it immediately translates to feelings, emotions, and sometimes movement. Smell has the same effect on the primal part of the brain. Memories related to scent are resistant to time and more easily recalled. Read “Marketing’s new realities“.
- Web-based products are being developed that look at the various product claims, summarise the falsities, and troll the brands with facts. We haven’t even seen the beginning of this yet.
According to BBC.com, 75 per cent of men and 68 per cent of women admitted to cheating in some way at some point in a relationship. The same goes for brand loyalty. Loyalty programs will need to evolve from looking at the “winning and keeping consumers” mindset to winning each transaction, building on the previous win. The goal will be to win a “higher share of preference” in favour of one’s own brand. Brand exclusivity is an unrealistic aspiration. Brands/companies should recognise that consumers expect them to be loyal to them, not the other way around. Marketers need to understand the true dynamics of loyalty and healthy consumer relationships.
Work the entire loyalty hierarchy
This means understanding consumers’ mindsets, at as granular a level as possible, in terms of what causes they care about (purpose), what they are fans of (passion), what their family or social networks are (relationship), and what their buying behaviour is (commerce). All four should be incorporated simultaneously.
Advertising (as we know it) is dead
Today, it is estimated that the average human’s attention span is slightly less than that of a goldfish, at under eight seconds! A person is exposed, on average, to anywhere between three and five thousand commercial messages every day. Every single day! This is an astronomical information overload and is humanly impossible to process.
People want smooth, seamless, and uninterrupted experiences in their day-to-day lives. They do not like friction. They do not want interruptions. Today, the estimates for the number of consumers who use ad-blocking software range anywhere from six hundred million up to two billion, which is roughly a fourth of the world’s population. First and foremost, look at other ways of attracting and engaging consumers.
The key is to realise that consumer’s preference has to be won every time—it is not one and done. And that ability to win every consumer transaction makes it necessary for the marketer to know the context for each of those transactions. Develop contextual preference management (CPM) platforms. Access real-time information about the consumer, whether purchase data or location.
Delight the consumer
Are you designed for customer delight? Nothing works better at holding on to consumers than giving them an intuitive and a delightful experience throughout the purchase life cycle, from buying to using it to returning to buy again. All of this means marketers have to create systemic programs and platforms that blend the art and science of preference management via context, experience, and emotion. Give me affinity. Give me chemistry. Give me context. Give me relevance. Give me experience. And I will give you profitable growth and sustainable share gain.
Use fantastic experiences to grab consumers’ attention and raise their opinion about the brand, which may give significant salience in people’s minds and robust differentiation from competitors. Grab their attention and captivate their imagination with some unique experiences. Ensure they have a flawless, seamless, and extraordinary experience to leave a lasting impression and long-term memory. Throughout the experience, the brand association needs to be brought out in a natural, unforced manner. The experiences have to stand out, not necessarily in terms of luxury or high price, but in uniqueness and creativity. When that happens, they have a very high propensity to tell the story of their experience to others. Unobtrusively enable consumers to share their experiences, their stories, via their own communication.
Word of mouth
The big question is, do people talk to their friends or relatives, to whoever is in their network, about brands? The answer is a big yes! Research has shown that 74 per cent of people make their brand choices and preferences based on the recommendation of people in their network who have experience with a brand or with a product. Good old word of mouth. Word-of-mouth publicity is still considered to be one of the most reliable, dependable, credible, and effective ways to spread the message about a product, service, or brand. Read “Talk triggers“.
Selling to AI
Your brand is the sum of all the experiences. Imagine an AI or a digital assistant doing the totalling for the customer.
- People are being cut out of the purchase process. The algorithm or the machine takes the burden away from the individual and completes the purchase. Smart speakers are eliminating the need for people to go through the tedious process of searching, comparing, and making up their minds. When you ask Alexa or Google Home for product information, you get in return either an explicit or implicit product or brand recommendation.
- Also, a lot of companies are already doing their Request for Proposal (RFP) responses using AI. The AI engine looks at the RFP, understands the questions being asked, looks into internal databases, including how the company responded to other RFPs in the past. Based on this, it comes up with compelling responses, which are as good as or better than those done by an army of staff. It does this in a fraction of the time, more accurately, and with more up-to-date information.
- Seventy per cent of the time, they rely on what Alexa recommends. So marketers just cannot ignore this very important new medium for marketing. Another interesting dimension will be how these smart speakers and assistants transition into a business-to-business context.
Read “The four“.
At this time, there is no real excuse for not getting more robust ROI measurements from marketing. Even better, marketing should have its own CFO who also reports to the company CFO. It is critical for the CFO and CMO to have a strong partnership. Accountable marketing a CFO understands and likes.
Eighty-three per cent of people globally believe brands have the power to make the world a better place, and 87 per cent say brands must stand up for what they believe in. Eighty-four per cent believe businesses have a responsibility to spur social change. 64 per cent say they will buy or boycott a brand based on its stance on a social or political issue. Several studies have demonstrated that organisations with an explicit purpose, which are purpose-driven, fare better than those that do not.
Purpose is the new black. One study says purpose-driven companies outperform the market by 42 per cent. But many get confused between what a purpose is and what cause marketing is. Purpose is the fundamental reason why a company exists. It is a North Star, a guiding principle, a core value of a company. Purpose is a North Star, and cause marketing is the road map. For purpose-driven companies, building continuous momentum and maintaining consistency is the key. Purpose is truly brought to life when it is completely blended into the core of the company’s business model. Patagonia is an excellent example of a company integrating purpose with its business practices totally.
It is shocking that only 34 per cent of consumers trust the brands they buy. Marketing is, unfortunately, viewed as some kind of a con game by a large chunk of the population. As marketers, our livelihood depends on consumers. So why would we cheat? Quantum Marketers must first realise that trust will be a gigantic competitive advantage. Our advertisements have to be authentic and truthful. When a brand is seen as being not genuine but merely taking advantage of a social issue, there is no advantage for the brand. And we have to make sure that there is no deception, lying, cheating, or exploitation.
Marketing is risk management
The number of risks are substantial. Reputational risk, financial risk, intellectual property risk, compliance risk, legal risk, consumer privacy risk, and on and on, each of which can blow up so big that they can blast a company out of business. It is absolutely imperative for marketers to begin being responsible for risk management.
The Quantum CMO
And here are what characterise Quantum CMOs:
- Quantum CMOs are incredibly knowledgeable about the foundational and classical aspects of marketing.
- Quantum CMOs understand the basics of human psychology, sociology, and anthropology.
- Quantum CMOs also have a deep appreciation of the contemporary and emerging fields of marketing.
- Quantum CMOs are technologically savvy.
- Quantum CMOs are on top of connecting the dots between marketing activities and business outcomes.
- Quantum CMOs are inspiring leaders with a big vision.
- Quantum CMOs are strong, empathetic leaders because they are driving teams through this transformational phase,
- Quantum CMOs are evangelists for marketing, particularly if they are in companies that are not marketing driven.
- Quantum CMOs have tremendous curiosity and agility.
- Quantum CMOs have a global mindset.
- Quantum CMOs are team builders.
- Quantum CMOs view marketing as a customer-facing function.
- Quantum CMOs understand that their roles don’t end with growing and protecting the brand and the company. They realise that they wield an unbelievable level of marketing power and influence and can make a difference.
- Quantum CMOs play an important role in formulating the regulatory environment.
- Quantum CMOs are good partners.
- Quantum CMOs are agency realists.
- Quantum CMOs take care of their health.
- Quantum CMOs have not only a high intelligence or emotional quotient, but they also have a high creative quotient (CQ).
- Quantum CMOs have a high decency quotient (DQ).
- Quantum CMOs have a good mix of IQ, EQ, CQ, and DQ.
- Quantum CMOs feel happy, energised about, and look forward to their work, or they change their way of going about it or move.
Quantum CMOs are like Leonardo Da Vinci. They are multifaceted and multitalented, excelling at the art, science, and the technology of marketing. Quantum CMOs are primarily business leaders who understand the business. You need to be an evangelist for the rest of the company and build strong bridges with others.
Bringing marketing back
Bringing marketing back to where it belongs: in the spotlight, in a place where it’s delivering and driving businesses, where people are enjoying themselves, having fun. Making sure you stay different and become a firm of endearment.