When Worlds Collide
It’s time to redefine the term Digital Convergence.
Outside the R&D labs of Huawei and Apple, who rightfully have an important hardware-oriented definition of “Digital Convergence”, I am convinced there is a space where the communications, advertising, technology and content production industries are meeting, overlapping with very few businesses adapting their models to address this transition. There are many thought leaders actively analyzing and describing this space, but very few companies moving on it. VICE Media and Business Insider are a few bright shiny examples that are the exception to the rule.
Why is this happening? In a now decades-long tradition, the Internet continues to disrupt business models. For example, we see public relations companies vying for advertising awards and advertising agencies winning public relations awards. Both are trying to be digital agencies that do marketing while marketing is quickly becoming the realm of math geeks and spreadsheets that is the practice of analytics. All of these traditionally distinct communications disciplines are trying to dive into mobile marketing while very few have gone beyond applying the same logic of their own business models. It’s like watching a golf pro, a tennis pro and a billiards pro going after a frisbee with their weapons of choice. This is why our smartphone apps can occasionally resemble the annoying pop-up landscapes of PCs past and those without the Google extension are still sitting through those painful YouTube adverts that do nothing except drive customers away from brands.
Today’s communications landscape often seems messy, confusing or even frightening to those with long experience in the traditional communications business models and their related silos. However, as the smoke clears the end result will be a better service / product for clients. A similar scenario unfolded around ten years ago in the world of travel agents and hotel booking and we ended up with Expedia. The latest iterations are even more exciting, companies like AirBnB and Uber keep pushing boundaries to the benefit of consumers. Banking dido, music industry dido. I remember just a few years ago the brutal debate among book publishers around Digital Rights Management and how a viable ebook market was a decade away. Authors, publishers and readers have finally begun to realize they can completely bypass the printing press and go straight to the tablet — or phone — that everyone has now. Every time an industry is disrupted it has ripple effects on other industries. The communications industry holds simultaneously some of the last holdouts and the fastest adopters, almost by necessity. Everyone has Twitter on their smartphone, but some are still faxing press releases. To a lot of the big agencies, video, pretty much the most evolved communication tool when it is done right, is still something to be outsourced.
How can this convergence be leveraged? Every company can leverage this dynamic and evolving space by finding people with three important talents:
As much as I like Mad Men, the days of pulling a must-win campaign out of a hat are over. Analytics is looming large for everyone in a marketing role at brand and many are simply giving up on agencies and turning their brands into media companies. Agency leaders know this and are up in their ivory towers sweating about how to bring everyone up to speed on a scalable analytics offering. I’ve seen this firsthand. However, the various applications of analytics to big data are infinite and complex. Many companies already have all the “keys to the kingdom” and only lack any idea, or the will, to use them. Ironically, while images of boring math geeks come to mind it actually takes a great deal of creativity and confidence to decide how to apply analytics resources, which data to look at, what to shadow and how to use the knowledge gleaned from incoming data inline with the business model. It also takes a big set of stones to look up from the data set and say the business model needs to change.
For an overly simplistic example, if the results of our Facebook campaign tell us that:
98% of the Pink Banner Ads were clicked
2% of the Blue Banner Ads were clicked
A) Make all ads Pink?
B) Keep experimenting with banner colors or
C) Write an algorithm that automatically adjusts all banner colors to the most successful color after 10,000 clicks?
The answer is another question: What’s our budget and what resources do we have access to? Creativity in the creative industries is still thought to be limited to storyboards and Photoshop when it needs to include creative data mining with all-in commitment from the very top.
As American statistician, William Edwards Deming once said, “In God we trust; all others must bring data.”
The future of marketing is much more analytics than gut feeling and companies that are not willing to apply this discipline will simply not be around in the long run. There is an old joke that illustrates this better than I can:
Two guys are hiking through the jungle when they hear the roar of a tiger nearby. One stops to take running shoes out of his backpack and begins putting them on. The other, incredulous, says,
“What are you doing? You can’t outrun a tiger!”
The other replies,
“I don’t need to outrun the tiger. I just need to outrun you.”
By aggregating the right data and then mining it with creative analytical models companies take the guess work out of planning, increase return on investment and speed up the entire process. It’s a triple threat. Bidding on contracts, pricing services and building brand profiles that include the entire social media footprint are all fair game. Armed with real-time information they know is accurate brands or their agencies can then create content that appeals to their target and deliver it via the medium their target is using right now, today, because tomorrow their fickle audience will change their behaviour. This is easier said than done but the good news is the hard work is not developing the methodology, it’s basic change management. Out with the Luddites, in with the creative math geeks.Out with the Luddites, in with the creative math geeks.
This should not be news to business leaders and yet who can argue that good strategy is only possible with deep understanding? Do all business leaders truly understand what is going on at the bleeding edge right now? The very nature of the convergent space is dynamic and evolving constantly so deep understanding can be a tall order. I believe the first step to developing a strategy that will take any communications related firm into the future requires an acceptance that the strategy can and will change at a much faster rate. It is no longer an annual week-long offsite “strategy session” that locks in a plan for the next year until results can be reviewed and changes can be made the following year. It wants to be a daily, iterative discussion about a trusted dashboard that revisits the opportunities and challenges the environment throws up for brands, business units and even business processes. This means setting up an iterative cycle which is both:
A) Possible for every firm and
B) Much more difficult than it sounds
This is a process, not an event, and requires what Jim Collins refers to as “disciplined people…who engage in disciplined thought and…who then take disciplined action.” Not a brilliant idea from a CEO. Not a Creative Director’s “instinct”. Not a copy of what the competition is doing.
If I had a dollar for every CV that states, “strategic thinker” I’d retire. What are needed in this case are people that think in terms of systems. Systems that can, if necessary, be trashed in a day and rebuilt from scratch where required. Tearing old strategies down and building new ones inline with the strengths of the organization, the environment and the available resources requires a unique blend of business management, people and project management skill. In a sense, it almost cries out for consultants to be hired for this as so much unlearning is required from in house leaders path dependant on the business models of yore.
Your shareholders care and you need to stop pushing quarterly growth numbers on them at the expense of the long term health of the going concern.
The hardest part is decoupling from traditional ideas and investing the time and funds to setup a more nimble, analytical framework — to base a reliable strategy on in the first place. Unless we are talking a small start up not beholden to an established bureaucracy, in which case there is no excuse not to set up this framework, it may seem downright impossible at your organization. It may seem impossible or unlikely, like most change management challenges, especially for giant companies with tens of thousands of employees that have millions of customers. Then again, Wallmart and Target lead the way in this type of real time information gathering and we know they act on it strategically.
The bottom line is that the companies that are aware of and moving on the transition we are all experiencing will still be around in 2020. The firms that retreat to the outer fringes and deceptive safety of their traditional communications business models will not.
See original article: Medium