You Sell, Or Else...

I have moths in my house.  They are a real pain and as the Spring appears I know they will be making a reappearance after the cold winter months.  For the last couple years I have become involved in a Holy War against these little critters that has involved escalating levels of tit-for-tat violence.  They take out a treasured cashmere sweater.  I up the number of traps, sprays and any other type of micro-ordnance.  And guess which retailer has become my greatest friend in this battle against the pesky garb-munchers?  Rentokill?  Pest Control?  Mothball Express?  Nope, my accomplices in the clearance of my foe is Amazon.  A comrade that not only provides me with a wide range of munitions, but is also my accomplice, suggesting tactics and new devices 'used by others' to help me seek-and-destroy.  Now I’ve long been aware that Bezos’ empire was growing beyond books, but it was my battle against these flying clothes-gobblers that brought home the changing nature of retail in the networked media era.  Just 1-Click™ and my house is free of meddlesome midges.  What does this have to do with modern marketing, you ask?  In short, that most crucial aspect of markets and marketing, the Point-Of-Purchase (P-o-P) is changing quickly and in some very surprising ways.  In doing so, this shift is throwing light on some long-standing weaknesses of the marketing industry, whilst throwing down new challenges.  For example, I have a client who is fascinated by the fact that Apple now holds 100m active credit cards, primarily through iTunes.  The client in question runs a very significant online business himself, with about two million UK customers.  So he is fully versed in the value of those billing relationships that Apple has garnered.  He also has a theory that Murdoch’s insistence on a paywall for his online media is motivated by a similar vision to that which Apple has intentionally or accidentally executed.  If The Old Digger can use juicy new media content to gather micro-payments and therefore credit card details, it won’t matter if the newspapers are profitable or not.  They will become giant magnets for billing info, allowing Murdoch to sell wine and insurance products to the readers of The Sunday Times.  Even the forward-looking games sector has been surprised by the skewing of the P-o-P.  In his must-see presentation at this year's DICE, Jesse Schell, a game design professor at Carnegie Mellon University, summed up the rapidly changing nature of transactions.  He explained how the games development industry has been caught completely off guard by...

...the rise of social gaming, and particularly virtual currencies.  ‘EA laid off 1500 employees and spent $300m on social gaming studio Playfish on the same day’, exclaims Schell, ‘what in the world is going on?!’. 

So what does this mean for marketing?  Well, as one or two of you (ok one) might have noticed, my professional starting point is that Marketing is about Markets.  Not Advertising/PR/Sponsorship/DM/Social/Web or any other siloe of the industry.  This gradual shifting of the P-o-P is an example of networked media creating new markets run by different players.  It’s a trend that looks set to run and run, especially with the continued rise of micromedia and powerful mobile groovyware. 

These days there are plenty of ways that you can roll out a campaign one morning and just listen out for the Kerching of the online cash tills later that same day.  So if you are still only measuring media to understand the impact of your consumer insights and creative excellence, you may be missing out on new expanding markets.  Markets that in the lean years ahead will offer elusive areas of growth. 

It was David Ogilvy who said, ‘We Sell, Or Else’.  Today, the question for advertising and other promotional channels is how to make brand communications work (ie sell) harder and get people queuing at these new P-o-Ps?  How can brands be brought closer to these new mass markets that are driven by real-time data and strange virtual credit systems?   Ogilvy’s simple reminder about the role of the marketing industry is likely to take on an increasing poignancy.  Networked media means transparent markets.  So clients will care less about the line on their media investment schedule (above, below, through or otherwise) and more about the bottom-line on their P&Ls.  Media evaluation and effectiveness targets will look very different as they turn from Reach to Cash.  Or put more simply - You Sell, Or Else…

Comments

[Charles Frith]

Splendid post James.

[James Cherkoff]

Very kind sir. Hope you are well... ;-)