Why marketers need to embrace brand elasticity in the era of personalisation

by Jed

A few colleagues and I entered the WARC / AdMap 2016 Essay competition this year. We didn’t win, but we did get shortlisted, so that’s something, I suppose. The question was “How should marketing adapt to the era of personalisation?”, and I was lucky enough to work with two proper brains; Ruth Zohrer (our head of programmatic marketing), Jeremy Pounder (our head of media futures). Our entry was below.

The era of personalisation represents an opportunity for marketers to return to the roots of marketing – to rediscover what it means to connect the right product to the right person, and to rescue the broken relationship between both parties.  In a world where technology demands new approaches to product, price, promotion and placement, delivering successfully in this new paradigm will require that we develop ‘brand elasticity’ – a brand’s ability to have a clearly defined core meaning while flexing its interpretation in different circumstances for different people.

The past ten years have seen an explosive growth in marketing technologies. One need only look at the marketing technology landscape year-on-year to realize how many new players are entering the space[1]. This trend exemplifies the increasing desire of marketers to be more advanced, to be “fitter, happier, more productive” (to steal a phrase from Radiohead).

Yet technology has become a double-edge sword.  On the one hand it is seen as the solution to a gamut of issues that face the modern marketer – ad blocking, cookie clearing, skipping and ignoring content – yet in many instances, it is precisely this poor application of technology that has caused them. By the same token, consumers are now armed with just as much technology as the marketer, and similarly, technology is seen as the solution to a gamut of issues they face, such as preserving privacy and enforcing anonymity.  Marketing sometime feels like a battlefield.

But it doesn’t have to be this way.

If we go back to the roots of marketing, its core purpose has always been about connecting the right consumer to the right product.  Applying Jerome McCarthy’s 4 Ps framework: to produce a product or service that consumers will want, to price it at a level that corresponds to its perceived value, to promote it amongst consumers who will have a use or need for it, and to place it where it is easily accessible to those groups of pre-qualified people.

The first half of the twentieth century started to fray the edges of that definition through mass distribution of products, with little differentiation, at roughly similar prices. The boom in mass media platforms from the late 1960s, coupled with a change in consumption habits – less connected with utilitarian needs, and more to do with status and comfort[2] – meant that ‘broadcast’ advertising, at large groups of people who might be interested in the product or service, was possible.

Promotion, hence, became the defining P in the 4Ps framework leading to a golden era in advertising.  Yet this did not come without a trade-off.  The term ‘media wastage’ was born, and with it we shredded the original definition of marketing.  At its best, marketing became a game of selling an aspiration or an identity… and at its worst, it became a ‘throw enough at the wall and something will stick’ game.

Then came AOL. Then Google. Then YouTube. Then Facebook. And now, through advertising technology we can finally realise our dream of reaching the right person, with the right message, at the right time, and on the right screen. Most importantly, our production capabilities are also catching up.  The advent of 3D printing offers opportunities to not only promote the right product to the right person, with the right message, at the right time and on the right screen, but also to produce something that is much more bespoke and relevant to the consumer[3].  We’ve gone full circle, and we’re now back at a place where we can truly connect the right consumer to the right product, in ways we never before imagined.

Yet while technology has gone full circle, our thinking hasn’t and few are taking advantage or these new opportunities.

We need not despair as there are green shoots of positivity. Personalisation, at its core, gives marketers the opportunity to design or create a product that meets someone’s individual requirements – it is the purest definition of marketing. This exposes an interesting tension. It’s a tension between what the brand wants to collectively ‘mean’ and what an individual consumer’s interpretation of that meaning is.

This presents the modern marketer with a challenge: in a world where your brand could have a myriad of meanings, the risk is that it ends up meaning nothing. We believe that this is where ‘brand elasticity’ becomes a critical part of the marketing toolkit. Brand identity and values need to be clearly defined (if you stand for nothing, you’ll fall for anything), yet there needs to be enough room and understanding for a marketer to accept that their brand’s identity may be open to many interpretations from different cultural groups.  The role of marketing in this new context becomes about constant evolution, and constant redefinition of the edges (based on cultural insights), but never straying too far from the core values of your brand.

So brand elasticity becomes a new measure of the strength of a brand, and its ability to stretch the edges of its values and meaning in order to adapt to different cultural groups. Too much stretch and its meaning warps, too little stretch and it means too little to too few people.

Having the correct balance of brand elasticity affords a brand a clear identity in the marketplace, but allows it to harness different interpretations with different cultural groups, to build relationships and connections, at scale.

It is what separates the HP’s and Lenovo’s of this world from the Apple’s and Google’s. It moves a brand from competing on price and product, to competing on cultural currency and credibility.

Brand elasticity has been a crucial part of many brands for at least half of the last century – what we’re talking about is not new – but as technology enables us to return to the core principles of marketing, it has never been more important for brands and marketers to think about their brand elasticity. The brands that have the best elasticity are likely to be those that see relationships as the goal, rather than share of voice and reach. Those that value their customers, and see them as people, not cookies. Those that truly deliver on the opportunity that personalisation has brought to the table.

For this to become a reality, marketing needs to fundamentally change.

The marketer of the future will need to go beyond demographics and focus groups filled with biscuits and warm beer. They will need to understand behaviours, interests, and reactions. They will need to understand how those behaviours are represented by data points, and how best to bring differing datasets together to create insights. Most importantly, they will understand the commonalities between different segments of people – they won’t be seduced by the overly idealistic idea of one-to-one communication – they’ll find a balance between individuals and segments.

As new technology begins to infiltrate the rest of the marketing toolkit, analytical and technical skills in marketers will become a ‘must have’, rather than a ‘nice to have’.

The increasingly blurred line between Chief Marketing Officers and Chief Information Officers will give rise to CDO – not Digital, but Data. They will be conversant in data management platforms and data flows, but also connected consumer journeys and programmatic advertising.

It will be data (both fast and slow) that will allow us to measure brand elasticity – the days of quarterly trackers will be numbered, as data gives rise to segment-level tracking, allowing brand elasticity to be measured, tested, and refined on a daily, if not hourly basis.

Market making and breaking decisions have never before depended so heavily on the marketer’s ability to understand the convergence of data, content, and technology. Their ability to harmonise data to elucidate multiple truths that inform that broader marketing plan will be the mark of the marketing rising star.

If we are to leverage the opportunities that technology and personalisation bring, the annual marketing plan must become a thing of the past. Its static nature and rigidity will not meet the needs of the marketer in the era of personalisation.

In its place we will need to develop living and breathing marketing systems: a set of parameters (logic-like rules) that will enable complex parts to work together seamlessly, and allow the marketer to learn and adapt constantly as data brings further knowledge. It may sound complicated, but in reality the infrastructure is already in place. Most marketing technology today requires human input into simple systems to create these sets of rules. In some cases this is represented by targeting parameters; in others as basic segmentation information and campaign objectives.

The role of the marketer will be to understand both the short and long term impact of advertising, and the effect that they have on brand elasticity. They will come to put lots of different segments at the heart of their brand, and become masters of systems thinking – ultimately, they’ll become skilled practitioners of unpicking complexity to drive incremental gains, and build stronger relationships with people than ever before. They will become gatekeepers to brands that truly matter.

It’s important to note, however, that technology won’t replace the marketer. A popular misconception is that in the not-so-distant future, marketers’ jobs will be automated, “all looked over by machines of loving grace” as Adam Curtis would put it, but people are nuanced, and meaning comes from understanding culture. If we were to allow machines to run brands, the world would be full of the most efficient brand messaging you could imagine – and that’s exactly how brands degenerate into oblivion, rather than reinvent themselves into perpetuity.

Finally, the marketer’s partners (agencies, technology companies) will need to adapt their roles as well.  Gone are the days when a marketer would provide a brief, leave it to a partner to execute, and come back to it six months later once the campaign had ended to view results. People come into contact with brands 24 hours a day. They’re forming and reforming perceptions, and building and ending relationships constantly. The shape of these partnerships needs to reflect that: marketers, their agencies, and technology providers need to become a unified team, a perfect triumvirate that leverages specialist skillsets at different points of the process.

Considering the core principles of marketing or the 4Ps can help illustrate the above in:

  • Product: For intangible products or services, we can already see the brand elasticity concept in action. For example, financial service products are put together within the parameters of what the brand stands for.  Different customers may be offered different products, all of which will be consistent with the brand’s values.  For physical products this has been more challenging due to production and distribution costs, but we have seen some customisation of fashion (eg Nike ID) within the parameters of the master brand.  In the long term, the prospect of 3D printing may make much greater product personalisation a reality.
  • Price: Marketers will determine pricing parameters for their products that will then be adapted to maximise the likelihood of an individual buying. This has already been a reality for many e-commerce sectors (e.g. hotel rooms, airlines) but we are likely to see it stretch to the real world as ‘smart shelves’ connect individuals in store to CRM databases and deliver personalised pricing, triggered by mobile signals.[4]
  • Place: Core distribution channels will continue to be set by the brand-owner but there will be increasingly flexibility in how and, importantly, where delivery is fulfilled. E-commerce delivery will become more personalised, determining with more precision when and where you want the product delivered. We will also see the rise of aggregators such as Quiqup, which help ensure personalised delivery of items from a range of retailers.[5]
  • Promotion: This has been the core focus of marketing personalisation to-date through the rise of programmatic and data-driven targeting.  The concept of brand elasticity becomes most evident here. The brand owner sets the broad parameters for how the brand can communicate and who it should be talking to, leaving the technology (increasingly AI) to identify who exactly to talk to, and what precisely to say.

Marc Andreessen famously said that software was eating the world[6], but until now it has only taken the bar snacks of marketing. This is the beginning of a perfect marriage between human intuition, technology, and artificial intelligence that allows us to deliver personalisation at scale – using data, content, and technology to harness the power of brand elasticity to co-create a brand with consumers. After all, none of us got into marketing to relentlessly retarget people with a pair of shoes that they’ve already purchased.

[1] From 2014 to 2015, the number of marketing technology companies nearly doubled from 947 to 1,876. Personalisation vendors alone more than doubled YOY and began to incorporate chat services as part of the suite of products, which is a testament to the demand and need for innovation in this space. Source: “Marketing Technology Landscape Supergraphic (2015)”, Scott Brinker, 12-Jan-2015, Chiefmartech.com (http://chiefmartec.com/2015/01/marketing-technology-landscape-supergraphic-2015/).

[2] “Designing Britain 1945-1975”, Visual Arts Data Service (http://www.vads.ac.uk/learning/designingbritain/html/crd_cultrev.html).

[3] “The third industrial revolution”,  21-Apr-2012, The Economist (http://www.economist.com/node/21553017).

[4] “The Second Era of Digital Retail”, Intel Labs and The Store WPP, 2015, pp. 12-13 (http://www.intel.com/content/dam/www/public/us/en/documents/reports/futurecasting-report-june-4.pdf).

[5] “On-Demand Delivery Service Quiqup Picks Up Backing From Delivery Hero And Global Founders Capital”, Steve O’Hear, 15-Sept-2015, TechCrunch (http://techcrunch.com/2015/09/15/quiqup/).

[6] “Why software is eating the world”, Marc Andreessen, 20-Aug-2011, Wall Street Journal (http://www.wsj.com/articles/SB10001424053111903480904576512250915629460).