Modern Marketing - Blog by Collaborate PR & Marketing

We All Love The Bazaar Now

Eric Raymond’s seminal essay The Cathedral & The Bazaar remains one of the most powerful analogies for the world of media and marketing today. In case you aren’t familiar with Raymond’s work, he explained how in the world of software design, for many years, engineers spent long periods locked away creating huge operating systems in institutional settings that were then wheeled out into the real world for people to admire and to obey.  However, the open source movement changed all that with online systems much more like global street bazaars allowing programmers to gather in informal networks and collaborate on technical projects in an organic manner, adding a little stitch here and a patch there, and always feeding their knowledge back into the main market, which remained forever in public ownership.  For many years Big Brands operated in exactly the manner of Raymond's Cathedrals, building towering spires that required Brand Architects and Guardians to maintain their sanctity.  However, in the shadows of these vast edifices grew global online Bazaars made up of people who found they could organise themselves around their passions, as oppose to the demographical pews ordained by the marketeers.  And gradually the flocks flocked out of the Mainstream Media Cathedrals into the hustle-and-bustle of these online markets.  However, this was just the beginning and people quickly realised that they could not only hang out in the Bazaars but could also bring their own soapboxes along in the shape of blogs.  And eventually, as these little soapboxes grew into giant social networking sites like Twitter, LinkedIn and Facebook, the Bazaar morphed into a global conversation.  One where people trashed the Big Brand Cathedrals as they pleased, or even helped build new ones, ignoring the pained grimaces of the Brand Guardians and Architects who could only see desecration wherever they looked.  However, that’s now all changed.  Big Brands have come our from behind their lecterns and are fully signed-up...

Nothing New Under The Sun

For a long time the marketing industry closed its eyes to the impact of networked media.  And while it looked the other way, Messrs Brin & Page ate its lunch and built the largest media company in the world.  Over the last year or so, however, possibly because of the Google experience, the marketing industry has done a U-turn and the consensus is now that the world has indeed changed forever.  So which view is right?  Unsurprisingly, the reality is somewhere in between.  A thread of my client work over the last few years has been challenging the notion that the maturing web means we should forget everything we’ve ever known and start again.  Forget the idea of brands, stop using TV as a medium, assume that the customer has morphed into a new type of being, accept that complete transparency is the only choice, believe that the only workable price point is free.  Only a total reboot will do, some claim.  However, this binary view of the world overlooks that while much has changed, more has stayed the same.  Corporations are still operating in markets where consumers are looking for value and trustworthy suppliers.  People are still motivated by the same needs – keeping up with the Jones’, caring for their families, exploring the world, self-expression, ambition, fun.  It’s just that the markets they use to find satisfaction have been rewired. ‘The problems which are not changing are human problems - which remain the same,’ noted Eric Schmidt, CEO, Google last year.  Take for instance, the social net de jour - Chatroulette.  It’s a perfect example of the many new wonderful and unexpected things that are emerging as a result of open networked media and widespread broadband access.  Built by an individual, using powerful distributed technology that now sits in bedrooms all around the world, it offers a P2P-experience that undermines traditional views of private and public identity and drives new types of social interaction.  And what is this remarkable bleeding-edge innovation used for?  Letting young men check out hot girls!  Whizzy new kit, same old motivations.  However, that's not to underestimate the ingenuity and scale of the new markets that people will build when they find their needs unmet.  I was lucky enough to meet Douglas Rushkoff last week and hear him speak about his belief that...

Time To Spread The Love (Not Blow Your Wad)

With the mind-boggling degree of innovation occurring in digital technology and networked media, it’s very easy to forget that, in commercial terms, we are still only talking about markets. And markets are still just made up of people.  The other commercial task that hasn’t changed is the need to deploy resources to work within the marketplace to realise specific aims effectively.  Such as building sales and keeping shareholders content.  What is changing, as every marketeer worth his Cluetrain now knows, is the nature of that marketplace.  However, these changes are still yet to be fully reflected in the marketing industry because the most important cog of the business - media finance - continues to lag the trends driving networked markets.  Big marketing shekels remain driven by two words – reach and frequency.  An approach akin to asking as many people as possible out on a date until one or more of them falls for the smooth new chat-up line.  And this view of the world is all about size.  Bigger.  Louder.  Harder.  The problem is that in the new marketplace this approach doesn't build relationships - it wrecks them.  Of course, awareness is absolutely vital for any brand, particularly a new one.  And there’s always going to be a need to get out the big guns out and fire away at the marketplace to remind the world that a brand still means business.  But consumers (aka people) are fed up with brands only offering them a one-night stand, time after time.  Just think about the financial services industry where enticing offers are sprayed around, only for the love to be slowly withdrawn once the deal is done.  The bank’s rate of interest gets lower and lower until it just fizzles away and the corporate desire for new accounts on the bedpost grows.  Which leaves consumers more cynical and determined to stay footloose.  Or to become ‘rate tarts’ as they are tellingly known by the industry.  For brands to break this Tiger Woods lifestyle, they have to change not only their ways but also, crucially, their means.  And that means a very serious redistribution of their cash.  For if a corporate or brand is only in town occasionally for a night out on the campaigning tiles its long-term reputation suffers.  These days consumers see reliable brands as being there for them 24x7 - when they need the help and support.  And how can a brand do that if it spends its marketing wad on the first night?  It’s not easy changing long-standing behaviour.  But unless brands spread their love, attention and cash throughout the year, and are able to hold some back to respond to people's demands, no one will believe their clever words and lovely promises.  In the world of marketing and brands, the size of your wad still counts.  But in marketplaces driven by networked media, people are more interested than ever before in how you use it.

Second Life 'Economy' Grows 65%

Second Life is still going strong and its latest 'Economy Wrap-Up' shows how sophisticated it has become: 'Here's a look at 2009 - through the lens of the US dollar value of gross earnings made by Second Life Residents during the year.   In 2009, Second Life Residents in the aggregate earned approximately US$55 million in real money, growth of 11% over 2008. This represents the sum of all US dollars transferred "out" of the Second Life economy by Second Life Residents, and into PayPal accounts, and then to bank accounts and wallets.  We call this figure "Gross Resident Earnings" and it represents the sum total of processed credits for Second Life Residents.  This works as follows: when a Resident business accumulates a Linden dollar (L$) balance through the sale of virtual items or other economic activity, they can sell their Linden dollars to other Residents on the LindeX or the Xstreet SL Exchange, creating a US dollar credit on their account.  Note that we are not including activity from third party exchanges as LindeX and XStreet SL exchange comprise greater than 90% of credits processed.   When a Resident with a US dollar balance on their account moves that balance to PayPal, we record and track that amount as a "processed credit."  Taken as a whole, "processed credits" are a reasonable proxy for Gross Resident Earnings, as they represent surplus Linden dollars gathered by a Resident business and turned into US dollars. In 2009, US$45 million of "processed credits" came from Second Life accounts and US$10 million came via Xstreet SL accounts.  Note that many Xstreet SL merchants also have significant inworld businesses, and use Xstreet SL to collect earnings from their inworld businesses as well as their Xstreet SL businesses, accounting for the fact that processed credits on Xstreet SL are greater than the volume of the Xstreet SL Marketplace and Xstreet SL Exchange.'

'You Can’t Step Into The Same Market Twice'

David Weinberger captures the complexity of networked markets:  "Traditional markets consist of  demographic slices, i.e., “social groups” of people who have never met one another. We choose particular demographics because we think they are susceptible to the same message. Thus, traditional markets are not real things to which we send messages. Rather, messages make markets.  Now, markets are networks…networks of people who converse and interact, spread out across the Internet. For example, at any one moment there are some number of parents with sick children who are on the Net talking and posting, on blogs, discussion boards, social networking sites, Twitter, etc. etc. etc. But that networked market is substantially different in 12 hours because their kids are getting better. And of course 12 hours is an extremely long periodicity for these networked markets. They change constantly. Think of how ideas ripple through Twitter. Furthermore, not everyone in the market of parents with sick kids are in it the same way. The illnesses vary, the seriousness of the illnesses vary, the relationships vary. Think about the gay network in this regard: I’m sometimes in this network because I blog about gay marriage. But if you, as marketer, fail to recognize the complexity of the interests in this group, then you’ll be sending gay dating solicitations to people who don’t want them, including some who are in this network because they’re posting homophobic comments. Networked markets are rippling, ever-changing, hugely complex, inherently unstable, and thus thoroughly unlike traditional markets. In short: You can’t step into the same market twice."

Fanning, Cohen And Now Kan

One of the remarkable, recurring themes of our times is how an individual can take an idea onto the web and, often through the power of naïve enthusiasm, accidentally force a billion-dollar media industry to rethink everything it does - whoops!.  This, of course, is what happened when Shawn Fanning unleashed his college dorm project – Napster - onto the world.  Devastating the music business wasn’t Fanning's goal.  He just wanted to help his friends find their favourite tracks more easily.  But the Big Labels never recovered and even though Napster wasn’t the only P2P service offering music downloads, Fanning became the unfortunate public enemy number one of the powerful RIAA and its crazed legal battles.  Then came Bram Cohen, the creator of BitTorrent, a P2P protocol that allowed people to share large software files online more easily, by breaking them up across networks of participants’ computers then making them easy to find and reassemble.  Rather than relying on one machine to sit at the centre of a network and do all of the hard work.  Such was the success of Cohen’s brainchild that at one point BitTorrent was thought to account for one third of all internet traffic.  The result was the disembowelment of the movie industry’s distribution model and the eternal wrath of the MPAA.  However, like Fanning, profits didn’t seem to be Cohen’s motivating factor.  The only visible source of income from the BitTorrent project has been the T-shirts he has sold to its fans, emblazoned with the slogan, ‘Give And Ye Shall Receive’.  And now we have Justin Kan, creator of Justin.tv.  Kan’s original experiment in 2007 involved wiring himself up to a mobile camcorder that streamed live onto the web.  His motivation was to let people create their own ‘livestreams’, with the undercurrent ideal that CCTV shouldn’t be available only to the authorities.  However, Justin.tv has quickly developed into a service that allows anyone to create a live TV channel.  Today the site attracts more than 41 million visitors per month and has 428,000 'channels'.  Some of which are dull feeds of people sitting at their desk working, others are vibrant niche channels of hobbyists.  However, a few are feeds of live sports events that individuals are uploading from their paid subscription services, complete with community tools such as chat.  Sound familiar?  The difference may be that Shawn Fanning and Bram Cohen were the pioneers who taught the legal profession that the world has actually changed.  And Kan’s service is already joining a burgeoning, web TV ecosystem.  For instance, Fanning financed his project with the help of his uncle while Cohen had no commercial aspirations at all.  However, Kan’s project is supported by Silicon Valley’s respected technologist Paul Graham and his fund Y-Combinator.  The fly-in-the-p2p-ointment is that live events, particularly sports, are meant to be one of the last bastions of broadcast TV’s superiority.  So it seems unlikely the industry will just sit on the sidelines.  However, the trend of passionate individuals unknowingly wreaking havoc on global industries continues.  And Justin Kan looks like he might just be the next innovator to keep media executives' heads spinning.

Marketing Is No Longer A Game

The $500bn global marketing industry is driven by metrics.  TVRs, GRs, OTS, TGI, ABC, BARB, CPC, CPA, PI, CPM, frequency, benchmarking, response, reach, hits – the range of measurement systems has exploded as the complexity of marketing continues to increase.  Which has led to a gaming mentality among some parts of the industry, where almost any activity can be shown to be successful.  If it looks like a campaign isn’t working it doesn’t mean it’s ineffective.  It means you're standing in the wrong spot.  However, in the share-and-compare world of personal media, social networks and communities, it’s simply not possible to game the system.  If you’ve created a Facebook page, or an online forum, or an all singing-and-dancing app fest with mobile bells and whistles simply begging to be API’d and distributed around the widget world, no level of metric analysis will demonstrate success if no one joins in the fun.  Any figures you try and flaunt to justify the activity will be drowned out by the sound of silence as the wind whistles through your Twitter feed, swinging the doors on the hinges of your silent social experience.  No level of metrics will disguise the fact that No One Is In There.  And should you try and lay a little Astroturf or sock up a few puppets, you are likely to discover that your conversational marketing takes on all the allure of a bowl of plastic fruit.  Now whether this is of any significance depends upon your viewpoint of where the marketing world is headed.  I chaired a little social gathering down at the IPA a couple of weeks ago where Mark Earls put the case for a connected, networked world being a sea change for every part of the communications industry.  While others declared social to be a welcome new ingredient to the already murky marketing soup – but no more than that.  Just DM and WOM for a new era.  So if you’re with the Herdmeister then the fact that the game is up...

Learn To Earn

Freddie Laker (no not that one) gets to the nub of the matter: "Sometimes I like to talk about the "paradox of marketing.” As marketers we feel obligated to get our clients/brands where the eyeballs are. We then descend on that thing like vultures and in most cases we destroy that thing we originally loved and saw as an opportunity to reach consumers. (Think George from “Of Mice and Men” with the rabbit.) We’re currently in the process of killing Twitter as well.  The next great mobile revolution will be focused on the culmination of social networks, geo-location services, content creation/sharing, augmented reality and the functions that come with rapidly increased bandwidth, such as live streaming video. My fear is that marketers will be irresponsible and will use these technologies to pound consumers with horrible interruptive ads that make consumers revolt against mobile marketing. We’ve already had epic failures with some marketers’ mass SMS broadcasting and then the totally idiotic idea of connecting to discoverable Bluetooth phones when they’re in proximity of a broadcast point.  There’s so much new technology that has the potential to redefine interaction between brands and consumers, but unfortunately too many of us are still using advertising techniques that we’ve used for the last century — and they are primarily disruptive in nature.  The “techies” have done a great job of continuing to innovate and evolve the medium. Now it’s time for marketers to show the same passion for innovation and evolve with the medium, rethink our approaches and be respectful of the most intimate of digital touch points. We’re marching into holy ground with mobile marketing and if we’re not careful a select few of us will ruin it for the rest of us and this time, I don’t think consumers will be as forgiving."  (Via Heavyset).

The Need For Speed

I’ve recently found myself perusing the day-to-day differences between the marketing industry when I started my career in 1992 and today.  And I think it boils down to one word – speed.  As a college newbie I remember coming to terms with the fact that much of my account executive job was managing paperwork between the agency team and the client.  From months before the campaign, through the launch, during the programme and at the end of the activity.  Proposals, updates, status reports and analysis documents were constantly ping-ponged backwards and forwards.  Sometime quickly, sometimes very slowly.  But back then quickly meant on a weekly basis.  These papertrails underwrote the activity of the marketing industry.  Activity that was gathered, prepared, nurtured, planned – often in excruciating detail – before being launched into the market.   However, today’s markets are faster.  Which means marketing needs to be faster.  Including the systems and processes that keep the wheels turning.  So what’s driving this need for speed?  A while back Johnnie pointed out to me that customers now have the technological advantage over companies. Anyone who boots up their corporate laptop and then goes to make a cup of tea while the processor sorts through a million security patches and firewall protocols, will understand this.  Compared to the ease with which individuals can draw upon free web power or download new applications, corporations are technically hamstrung.  Which can lead to a disconnection with customers.  ‘We no longer feel we are immersed in our customers’ world,’ a manager from a mega FMCG company told me, frustrated by his IT department's refusal to let his PC access social networking sites.  But turbo-charging the speed at which the marketing industry works isn’t a trivial fix.  Go-faster stripes aren’t enough.  Corporations and brands still...

Conversational Marketing (And Why It's Good To Hate)

In recent discussions I have described the stuff that happens where the world of networked media and marketing collide as, ‘conversational marketing’. Now, I am aware that this is hardly a breakthrough term. The c-word is now firmly lodged into the boilerplate of every marketing proposal to hit the pitch desk in 2009.  And it drives some people to distraction as it suggests some type of creepy word-of-mouth practice where ‘friends’ start dropping brand names into conversations in the pub.  Particularly those that they have spontaneously found to deliver amazing value or excellent customer service.  However, I think it does work when the companies in question realise that there are some conversations in which they can take part with credibility - and others that they shouldn’t touch with a conversational bargepole.  Identifying which those conversations are isn’t entirely straightforward.  That’s because brands instinctively want to go and hang out with the cool kids.  An example would be a massive brand trying to follow someone on Twitter.  Or a product trying to join a blog chat. Both of which can result in cringe-making disaster.  However, there are, unsurprisingly, conversations that brands can have and join with credibility.  The trick, in my experience, is to start with working out what the company or brand in question is passionate about.  Now this question may result in much eye-rolling from cycnical execs who equate the health of the corporate balance sheet with pain not passion.  Or alternatively, lip service to some corporate mission statement or, worse still brand bible, which has all the passion of a Stepford Wife.  However, I have found that by digging beneath the corporate facade you can almost always find something of genuine interest, even if it at first sight it seems weird or dumb.  One way into the subject is to find out what people in the company or organisation hate.  Answers I've had to that line of enquiry have included the way their company is portrayed in the press.  Or an irritation about a damaging urban myth that won't go away.  Something similar, I believe, is what set Robert Scoble off on his bleeding-edge blogging mission at Microsoft.  Staff at the software giant who felt they were doing good work in the areas of healthcare or innovative engineering were fed up with being seen as the Evil Empire.  By talking about the good stuff on Channel 9, they were able to engage in a genuine conversation that went beyond the brand.  The other good thing about the term conversational marketing, that I have taken to pointing out, is that people instinctively know a good conversation from a bad one.  There’s no need to analyse or measure it.  Everyone already knows.