Marketing is moving from customer segments to individuals. Seth Godin in his talk discusses the death of the TV industrial concept which informed us for the last 30 years. In a world where the customer has too many choices and very little time, all segment driven advertisements seems to be very similar and hence are ignored. Thus he argues that the advertisements have to be remarkable. In the past the marketer would target the majority of customers with their ads and that would bring them the sales. In this age of marketing, Seth argues that marketers should target the front tail of the bell curve. He argues that markets should target the innovators and the first adoptors as these are the people who care and will spread the message through the rest of the customer base. These are the people who are passionate about their product domain. This concept was also referenced in the book "The Tipping Point," where
Malcolm Gladwell discussed different types of people personalities who
help spread a product message and make the product viral. Malcolm labelled these people as "Mavens". They were defined as experts in the product domain and sought out by other product users for their knowledge of the product.
The CEO of IBM Ginni Rometty informs that changes in technology and the ability to collect big data and make sense of it allows marketer to target individual vs. segments. She argues that the challenge is now in understanding data vs. gathering data. She see increased cooperation between CMO and CIO in the coming months where CMO will collaborate with the CIOs to discuss how to mine big data to gain a specific edge in marketing to a company's customer base.
Gill Frisbie and Frank Acito discuss "The long tail." The concept of the "The long tail" states that in a company that offers a vast selection of a product it will be able to sell up to 98% of that selection as it will have products that will cater to a customer's individualized tastes. The concept of The long Tail is similar to what Seth Godin discusses in his lecture, where he is advocating targeting customers on the fringes who are passionate about a product to spread the word about the product. The long tail theory states that there will always be "Mavins" or first adopters who are so passionate about their products that after they try what the masses have recommended they will continue to try and comment on products that are less well know within their domain. Gill and Frank both discuss some of the negatives of this theory in their lectures. A key point they make is that for retailers targeting the end customers it may make sense to hold a vast variety of items but for manufacturers, it make not make sense to produce items that are in demand by such a small specialized section of the population. Sure there will be some items that in a selection that will be hidden gems but there is a reason why most items in a selection have little demand. The reason is that they may not be as good as the more popular items.
The HBR article on social media discusses the creation of online communities which are very easy to form, to discuss specific interests. These communities allow for information dispersion within the community at an unprecedented speed. Marketer have to consider these communities to spread the product message to be successful in the current environment. Communities now form around interests and enthusiasts. The exact people Seth Godin suggests that marketers should target, as they are willing to listen and are more passionate about the products. It is key for today's companies to formulate a strategy to interact with these online communities for both the promotion of its brand and products but also to mitigate negative consequences and foster a positive brand image.
The paradigm shift in marketing channels and who and how a company should market has changed significantly over the last few years (I dare say months!). Technology has enabled this unprecedented velocity of change. Companies that hope to compete and win need to embrace the virtual social environment that are created by online communities. They have to be able to comprehend the vast amount of customer data to advise their marketing strategy to be streamlined to individuals instead of segments and finally they have to focus their marketing on customers who will listen; customers who are passionate about their interests and are willing to try new products. Companies who can keep up with the change in this marketing landscape will realize that marketing has become economically cheaper in this new age, but more complicated as the customer have the ability to express their opinions to punish companies that fumble in its marketing, product and customer service. On the other hand those same customers will exercise that voice to reward companies that listen and respond to their needs.
Sunday, June 29, 2014
Sunday, June 22, 2014
02 Week
As a follow on to last week's blog on crowd sourcing, I am going to reflect on how companies can go about using the data from crowd sourcing. I will also discuss the new paradigm of marketing created by the need for customers to express their opinions and be catered to on their terms.
First let us look at what we can do with crowd sourcing. In the 45 mins video by Alma Whitten on 'Lessons from Googles Approach to Internet Security, Privacy and Encryption' we learned how Google is harnessing the power of crowd sourcing to provide better results for searches. Prior to watching this video, I was naive enough to think that Google only has a special algorithm to rank the search results based on links to the pages. I was impressed to find out that there is more to it than just ranking based on linked paged. The ranking based on linked pages is only the first step, Google is also gathering and tracking how the user interact with its search results to create a story which it then uses to further refine its' results. The aggregation of millions of search result stories helps Google refine its' search accuracy while preventing deceptive websites "the bad guys" from manipulating its' algorithms. Second, Google is using its' vast knowledge of searches to combine with other sources of information to provide faster/real time modeling of trends. They have partnered with the CDC to see show how flu is spreading across the US in real time. Once again Google is using anonymous information provided by the crowds to create macro patterns that help the crowds and in this case the CDC to help monitor and control the spread of a virus. Google also uses the search data that the users enter to create stories to help with spelling correction and translation. Once again the stories created by Google search users and interpreted by Google on how the crowds behave is used to help the crowds achieve the results they desire.
In addition to using the crowd sourced data generated by searches through its' search engine, Google is at the forefront on allowing the user community to try out its' products and gain feedback to make it better. A recent example of this effort is Google Glass. Google released, Google Glass as a beta version to test the market. On its' Google Glass website it monitored how the customers were responding to the product and then it decided to go into full production with the device. Google also bought YouTube a few years ago. Once again, it anticipated that video production was becoming easier through new technology and it understood the desire of people to create and post their own videos. Google also realized that the trend to consume video entertainment was changing as well, from traditionally produced professional TV shows to videos created by the people, for the people, of the people.. the democratization of video production and consumption. A new wave of marketing was emerging which had swung from broad segment based marketing to very focused marketing and now to group based marketing. Google through its' platforms for blooging, youtube, gmail and search has been very effective en-chasing from this new trend in marketing.
Marketing today is not about controling the message. The best marketing strategies involve the customers in a conversation about the products and services. This marketing requires companies to trust their offerings and forces them to listen to their customers. Companies that make a half attempt at it or try to rig the results on the customer feedback get punishe, and the brand value takes a hit as evidenced by Ford's experiment with the "fordboldmoves.com." Technology has enabled the crowd to express their opinion and it cannot be stopped. If the crowd perceives manipulation, it reacts to further show it strength of opinion as evidenced with Diggs.com removal of the HD DVD encryption key. Successful companies have relinquished control of the message and have joined the wave instead of fighting it. These companies have built trust and are rewarded by customer loyalty. Further because of their openness to customer feedback they have been able to evolve their products and services to the exact specifications of the customer. As this digital marketing revolution proceeds, customers will continue to demand, at an increasing rate, exactly what they want, how they want it and when they want it. Marketing is a good thing for when the customer gets what he/she wants, when he/she wants it, without having to go searching for it.
Crowdsourcing has a few draws back as well. As Google found out, it can be rigged. Also, there is a tendency of group think that can have undesired outcomes. As the research presented in the "Star Search" podcast, it seems like there was tendency for customers to give extremely positive reviews for the most mundane items. Perhaps because of the tendency for people to feel that they are experts and that their decision is generally right. An interesting experiment was conducted by yours truly a few years ago. I had noticed a retail store with 2 exit/entry doors right next to each other. I had also noticed that the customers were only using one of the doors and almost no one used the other door. This was further perplexing because the number of people entering and leaving the store during a Sale was so high that people had to wait in line to leave the store. For a moment I thought, perhaps like others, that the other door was locked and I waited in line to exit the door. After a brief moment I realized the stupidity of this wait and walked to the other door and opened it and walked out. Once I did that I noticed that more and more people realized this and started to use the other door as well until there was an even distribution of people using both doors. In an other experiment, I decided to stand on a busy street for a few minutes staring at the top of a building with a perplexed look. I was not really staring at anything in particular, I was just wondering if I could get a following of people who would stand next to me and stare at nothing to try to figure out what I was doing. My experiment worked, within 5 minutes I had approximately 45-50 people standing next to me staring into nothing at a building the more a crowd formed the more people got interested in the crowd. I left the crowd to stand in the back and observe the phenomenon. It took another 10 minutes for the crowd to realize that there was really nothing and no one really knew why they were staring at the top of the building. People where just doing what others were doing. Both these experiments tell me that while crowdsourcing is the future and is powerful tool, it can go awry. It can provide meaningless information and can be rigged. Thankfully more often than not, crowdsourcing does provide information that is relevant and the best answer to a problem.
I find this subject very intriguing and I wonder what other experiments we can do that can better help us tweak the results of crowdsourcing so that incorrect or irrelevant information from the crowds can be detected and discarded. I am sure we will find an answer to this problem (if it is not already found) in the very near term, as the new wave of marketing, and innovation relies so heavily on this.
First let us look at what we can do with crowd sourcing. In the 45 mins video by Alma Whitten on 'Lessons from Googles Approach to Internet Security, Privacy and Encryption' we learned how Google is harnessing the power of crowd sourcing to provide better results for searches. Prior to watching this video, I was naive enough to think that Google only has a special algorithm to rank the search results based on links to the pages. I was impressed to find out that there is more to it than just ranking based on linked paged. The ranking based on linked pages is only the first step, Google is also gathering and tracking how the user interact with its search results to create a story which it then uses to further refine its' results. The aggregation of millions of search result stories helps Google refine its' search accuracy while preventing deceptive websites "the bad guys" from manipulating its' algorithms. Second, Google is using its' vast knowledge of searches to combine with other sources of information to provide faster/real time modeling of trends. They have partnered with the CDC to see show how flu is spreading across the US in real time. Once again Google is using anonymous information provided by the crowds to create macro patterns that help the crowds and in this case the CDC to help monitor and control the spread of a virus. Google also uses the search data that the users enter to create stories to help with spelling correction and translation. Once again the stories created by Google search users and interpreted by Google on how the crowds behave is used to help the crowds achieve the results they desire.
In addition to using the crowd sourced data generated by searches through its' search engine, Google is at the forefront on allowing the user community to try out its' products and gain feedback to make it better. A recent example of this effort is Google Glass. Google released, Google Glass as a beta version to test the market. On its' Google Glass website it monitored how the customers were responding to the product and then it decided to go into full production with the device. Google also bought YouTube a few years ago. Once again, it anticipated that video production was becoming easier through new technology and it understood the desire of people to create and post their own videos. Google also realized that the trend to consume video entertainment was changing as well, from traditionally produced professional TV shows to videos created by the people, for the people, of the people.. the democratization of video production and consumption. A new wave of marketing was emerging which had swung from broad segment based marketing to very focused marketing and now to group based marketing. Google through its' platforms for blooging, youtube, gmail and search has been very effective en-chasing from this new trend in marketing.
Marketing today is not about controling the message. The best marketing strategies involve the customers in a conversation about the products and services. This marketing requires companies to trust their offerings and forces them to listen to their customers. Companies that make a half attempt at it or try to rig the results on the customer feedback get punishe, and the brand value takes a hit as evidenced by Ford's experiment with the "fordboldmoves.com." Technology has enabled the crowd to express their opinion and it cannot be stopped. If the crowd perceives manipulation, it reacts to further show it strength of opinion as evidenced with Diggs.com removal of the HD DVD encryption key. Successful companies have relinquished control of the message and have joined the wave instead of fighting it. These companies have built trust and are rewarded by customer loyalty. Further because of their openness to customer feedback they have been able to evolve their products and services to the exact specifications of the customer. As this digital marketing revolution proceeds, customers will continue to demand, at an increasing rate, exactly what they want, how they want it and when they want it. Marketing is a good thing for when the customer gets what he/she wants, when he/she wants it, without having to go searching for it.
Crowdsourcing has a few draws back as well. As Google found out, it can be rigged. Also, there is a tendency of group think that can have undesired outcomes. As the research presented in the "Star Search" podcast, it seems like there was tendency for customers to give extremely positive reviews for the most mundane items. Perhaps because of the tendency for people to feel that they are experts and that their decision is generally right. An interesting experiment was conducted by yours truly a few years ago. I had noticed a retail store with 2 exit/entry doors right next to each other. I had also noticed that the customers were only using one of the doors and almost no one used the other door. This was further perplexing because the number of people entering and leaving the store during a Sale was so high that people had to wait in line to leave the store. For a moment I thought, perhaps like others, that the other door was locked and I waited in line to exit the door. After a brief moment I realized the stupidity of this wait and walked to the other door and opened it and walked out. Once I did that I noticed that more and more people realized this and started to use the other door as well until there was an even distribution of people using both doors. In an other experiment, I decided to stand on a busy street for a few minutes staring at the top of a building with a perplexed look. I was not really staring at anything in particular, I was just wondering if I could get a following of people who would stand next to me and stare at nothing to try to figure out what I was doing. My experiment worked, within 5 minutes I had approximately 45-50 people standing next to me staring into nothing at a building the more a crowd formed the more people got interested in the crowd. I left the crowd to stand in the back and observe the phenomenon. It took another 10 minutes for the crowd to realize that there was really nothing and no one really knew why they were staring at the top of the building. People where just doing what others were doing. Both these experiments tell me that while crowdsourcing is the future and is powerful tool, it can go awry. It can provide meaningless information and can be rigged. Thankfully more often than not, crowdsourcing does provide information that is relevant and the best answer to a problem.
I find this subject very intriguing and I wonder what other experiments we can do that can better help us tweak the results of crowdsourcing so that incorrect or irrelevant information from the crowds can be detected and discarded. I am sure we will find an answer to this problem (if it is not already found) in the very near term, as the new wave of marketing, and innovation relies so heavily on this.
Saturday, June 14, 2014
01 Week
Hi All,
Though I am regular reader of several blogs, this is the first time I am creating one. I had considered starting a blog a year ago but life got busy and I didn't get around to doing it. I am thankful that my Digital Marketing class at Kelley has required me to start this blog.
When I registered for this class I didn't know what to expect from it. But reading some of the week 1 and 2's assignments has rekindled an interest I had in the subject of alternative business models. A few years ago I had read a few interesting books, "The Wisdom of Crowds" by James Surowiecki and "Tipping Point" by Malcolm Galdwell. I noticed some of the concepts we discuss in the first couple of weeks in this course are very closely related to these books. The concept of influencing your target customers by engaging them into your product/service design can make your products go viral was indirectly mention in the The Tipping point. The model of crowd sourcing was mentioned in The Wisdom of Crowds.
Crowd sourcing has been gaining traction at an accelerated pace in the last few years. In addition to the examples mentioned in the reading for week 2, I have noticed that sites like "TaskRabbit.com" have provided market place for multiple people to request and fulfill tasks. I have noticed over the last few years, that business models that encourage a social gathering of like minded people to exchange information or request help have done exceedingly well. An other great example is a Project Management, Coding and QA platform business model developed by "www.topcoder.com" This company charges a client a yearly membership fee. It provides a platform where a client can upload specs and then freelance project managers and coders will bid on the specs with their proposed design and charge. Once again, this is a good example of a company that has built a platform that creates a market place. The clients get a view of different design solutions to their proposed problem and the client gets to chose the best solution at the best price. These market places have demolished the national borders and have created a virtual society based on meritocracy.
I have not been familiar with the marketing domain in general and I have to admit I have been slow to embrace social networks such as Facebook, Twitter, Flickr, google+ etc. I have been very concerned about privacy and how much information I would like to put out on the web where I don't have any control of who is seeing me and what companies are doing with that information. But, with the popularity of these networks, I am well aware that I am in a significant minority. With the world moving in the direction where people want to share their every thought with the world, clearly it is a gold mine for Marketers. People profiles can be fine tuned to an individual. Marketing can now be targeted specifically to a person based on his online habits and posts. I believe we have just scratched the surface up to now. Newer devices coupled with the treasure trove of information help companies not only target individuals based on what they want but also when they would want it. Technology is enabling a pace of innovation in this field like never before. From where we stand today, companies that want to succeed in this new technologically enabled world, will not only have to keep a pulse on business models that would threaten their existing business model, but also on how they plan to reach their customers to keep growing more by selling more effectively to people who are interested in buying.
Ladies and gentlemen we have front row seats in witnessing a rate of change in lifestyle, never seen in the history of human kind before.
Though I am regular reader of several blogs, this is the first time I am creating one. I had considered starting a blog a year ago but life got busy and I didn't get around to doing it. I am thankful that my Digital Marketing class at Kelley has required me to start this blog.
When I registered for this class I didn't know what to expect from it. But reading some of the week 1 and 2's assignments has rekindled an interest I had in the subject of alternative business models. A few years ago I had read a few interesting books, "The Wisdom of Crowds" by James Surowiecki and "Tipping Point" by Malcolm Galdwell. I noticed some of the concepts we discuss in the first couple of weeks in this course are very closely related to these books. The concept of influencing your target customers by engaging them into your product/service design can make your products go viral was indirectly mention in the The Tipping point. The model of crowd sourcing was mentioned in The Wisdom of Crowds.
Crowd sourcing has been gaining traction at an accelerated pace in the last few years. In addition to the examples mentioned in the reading for week 2, I have noticed that sites like "TaskRabbit.com" have provided market place for multiple people to request and fulfill tasks. I have noticed over the last few years, that business models that encourage a social gathering of like minded people to exchange information or request help have done exceedingly well. An other great example is a Project Management, Coding and QA platform business model developed by "www.topcoder.com" This company charges a client a yearly membership fee. It provides a platform where a client can upload specs and then freelance project managers and coders will bid on the specs with their proposed design and charge. Once again, this is a good example of a company that has built a platform that creates a market place. The clients get a view of different design solutions to their proposed problem and the client gets to chose the best solution at the best price. These market places have demolished the national borders and have created a virtual society based on meritocracy.
I have not been familiar with the marketing domain in general and I have to admit I have been slow to embrace social networks such as Facebook, Twitter, Flickr, google+ etc. I have been very concerned about privacy and how much information I would like to put out on the web where I don't have any control of who is seeing me and what companies are doing with that information. But, with the popularity of these networks, I am well aware that I am in a significant minority. With the world moving in the direction where people want to share their every thought with the world, clearly it is a gold mine for Marketers. People profiles can be fine tuned to an individual. Marketing can now be targeted specifically to a person based on his online habits and posts. I believe we have just scratched the surface up to now. Newer devices coupled with the treasure trove of information help companies not only target individuals based on what they want but also when they would want it. Technology is enabling a pace of innovation in this field like never before. From where we stand today, companies that want to succeed in this new technologically enabled world, will not only have to keep a pulse on business models that would threaten their existing business model, but also on how they plan to reach their customers to keep growing more by selling more effectively to people who are interested in buying.
Ladies and gentlemen we have front row seats in witnessing a rate of change in lifestyle, never seen in the history of human kind before.
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