DM

From The Archives (2008) – On Digital Marketing

On Digital Marketing
Published In Dawn, Aurora, March 2008

by Umair Mohsin

With the increasing fragmentation of the consumer in Pakistan, it still continues to amaze me how much money still gets pumped into traditional media when even at the best of times, leading advertising practitioners used to admit that only 50 per cent worked and even then they weren’t sure which 50 percent. Life is more challenging for advertisers now that it’s generally accepted that mass marketing is no longer as effective as it was when they only had a 50/50 chance of success. Infact even twenty years ago nobody could have foreseen the challenges today’s marketers would be facing.

The base of this shift we’re facing now were the seeds that were planted about 10 years ago, when we saw the advent of the mobile in Pakistan through Paktel. It was a huge handset then, which only facilitated the dialing of the number. The SMS feature was inferior and still in nascent stages. However just 1½ after Paktel, global MVOs started looking at the potential of this market and introduced new and better handsets especially those based on GSM standards. Mobilink entered Pakistan and changed the face of the markets as we knew it. Now we’re witnesses to such metamorphosis in consumer behavior as such which has not been seen since the emergence of television in Pakistan decades ago.

Today the agency profession (and because of it traditional media) is being marginalized by businesses looking for bottom line accountability. This is simply because traditional media-based marketing models are shattering like Humpty Dumpty falling off a very high wall.

The economics of the industrial era were the ones in which the models for traditional media made sense. Interaction was expensive, so information about the expected benefits of consumption of products had to be squeezed into slogans, characters, and logos, compressed into thirty-second TV ads and radio spots. With the advent of the information age however and cheap digital interaction, these models are falling apart. When interaction is cheap, the very economic rationale which furthered the growth of traditional media actually begins to implode.

Let’s stop a bit and define ‘brand’ as the ‘total sum of all consumer experiences’. Now think about this next statement for a second: the #1 global brand belongs to a company that doesn’t advertise. Can you guess which brand it is? It’s not Microsoft. It’s not GE. It’s not even IBM. It’s simply Google. With every click of a mouse, every read of an article or completion of a search query, the digital brand delivers on its promise. The actual transactional cost of the brand’s interaction with the consumer is miniscule and yet each is responsible for creating an impression and giving value to the customer.

Building further on this base and depending upon number of touch-points as our criteria for choice of medium, you can easily see that the impact and reach of a digital brand is going to be leaps and bounds ahead of the non-digital brand.  This is because information about the costs and benefits associated with consumption will no longer have to be compressed into logos, slogans, ad-spots and column-inches as with traditional media. Instead, with digital media consumers can and will debate and discuss expected costs associated with and the benefits of the brand in incredibly rich details and the more cheaper the interaction gets, the more connected consumers will become and the more they will talk to each other – and the less time they will spend listening to the often empty promises of advertisers.

The information gap created in the past too will disappear. Before advertisers had focused heavily on measuring the means of awareness such as reach, frequency, etc (which too were theoretical) rather than the economic value they gained from traditional advertising such as ‘Advocacy Rates’, ‘Sales Conversion’, ‘Sales Uplift’, etc because with the limitations of traditional media there were simply very few other metrics possible. However common sense dictates that just because I’m aware of something, doesn’t mean I want it (Guy Soap, anyone?). Marketers still do not fully understand this especially with regard to new media. Digital media is not shackled by this lack of data which pervaded traditional media and allows for metrics far beyond awareness, is superior and can be measured from the instant the user sees the advertised message up to the moment of sale and afterwards as well. Digital is the most accurate, transparent, and reliable type of media. The simplest metrics e.g. can enable the calculation of the cost of acquisition of a customer giving you a rupee for rupee analysis of your spending in real-time.

Increasingly the marketer should realize that the multi-tasking, instant-messaging, e-mailing, cell phoning, emoticoning ;-), always on, gaming, Web-searching, blogging, social networking customers are for real and as they will scramble to find their footing in this new hyper-fragmented world, they will become painfully aware of the fact that customers are increasingly ignoring their marketing efforts. In what is being called the ‘experience’ economy, the customers overall experience of a product or service “throughout the customer life cycle” (Reach, Acquisition, Conversion, Retention) is now becoming the primary arbiter of a successful relationship with a brand. To add complexity to this model, we have the burgeoning media options which have fragmented the universe of customers and have made possible on-demand media consumption and lightning-quick word of mouth.

This trend will only amplify as the pace of digital innovation accelerates and is matched, step for step, by our interest in technology. One by-product of this development will be that the measures by which we understand “audience” will be shifting e.g. with longer working hours and a blurring of the boundaries between “work” and “life”, more and more we as consumers will be on the lookout for approaches, tools and technologies (not to mention friends, networks and colleagues) that will help us filter, assess and analyze information regardless of its source. We will become “Continuously Connected”. Therefore the term audience in the near future e.g. will include Pakistani technology blogs as well as normal consumers. This oncoming trend will have profound implications for brands and the way the consumer engages them.

Thus for marketers, the challenges—and the opportunities—are huge. Advertisers know that the traditional model is broken, and that the old rules do not apply. In this case it is digital marketing that will increasingly become the means of tapping onto such a consumer base, which has little time for TV, Print or Radio.  Already we can see this manifesting itself into our consumer’s lives. A research conducted by Google Pakistan e.g. estimated that at least 70% of the total internet population of 14 Million Pakistan spends between 1 & 6 hours online. Thus advertising is already becoming a choice – something that people can easily filter out and only choose to engage with if it helps them out, makes them laugh or turns them on.

“You tap onto the [digital] consumer because they’re more conducive to technology than any other medium even if they don’t understand it fully. The attention of marketers now should be on mobile devices & laptops. To tap into these mediums and to let the corporate message be available to them – this is the definition and the scope of Digital Medium in Pakistan in the current scenario.” Said Fouad Husain, GM, Mindshare, a GroupM company.

“Clients approach online media the same way they approach other traditional media. Digital marketing is not a mass medium. It is a peer-to-peer medium. When we realize that is it not a mass medium, we will begin to see the necessity of focusing on the right content for the right audience.”, said Naj
amus S
aqib, Head of Business Development, Intelligenes, a software house working on digital marketing techniques in Pakistan.

Taking notice of these trends in place, already companies like Unilever are moving into the digital realm. The brand Energile e.g. which is using football in its communication as a way of driving its brand amongst the youth is especially using this medium. To tap into the youth market further it has launched its own football portal online and has even made football interactive. People who don’t enjoy physical football will interact with the brand by a mobile game based on penalty shootouts which is downloadable from all mobile networks. Thus the brand is seamlessly integrating itself in the lives and conversations of its consumers further.

All things said, it’s about time that marketers grasp the changes that digital has brought to the communications industry – all media are digital, that all marketing is interactive and that all customer communications have to be integrated across media and time. Not that this is easy. The consumer has moved up. Unfortunately, the consumer has not been educated what this technology can do and consumer dynamics play a very important role when it comes to mass adoption of the technology. Aside from this we still have other obstacles to overcome, such as broadband penetration and speeds and most of all talent which can work with this medium.

“We do not have the capabilities in the agencies to tackle this medium. So for the near future, I do not foresee the digital medium growing. Talent and investment in this area will be required, because this area has not been recognized as yet.” said Husain.

Yet some companies, such as GroupM & Media Idee Interactive, are still making a conscious decision to go digital. Response based marketing is now driving advertising globally and companies utilizing digital media are building up consumer profiles, tailoring their offerings to those bases. Yet we still have a long way to go.

“Talk is easy. The real skill will be getting companies seeped in traditional advertising methods to realize how the market is changing. That’s a problem new media companies like ours are struggling to solve – pushing our clients to try different media & mediums and in different ways.” said Ehmer Kirmani, CEO Media Idee.

“How do we bring the brand to interact with the consumer [digitally]? We have to ask the question has it been built from real creative thinking with regard to the medium or is it just part of the overall package once the creative thinking has been completed. If it doesn’t get started from the former position, it never gets started at all. Digital means ‘Consumer Engagement’. It’s not about sending them informative SMS. It means molding your brand to fit the medium.” said Husain.

“The challenge for advertising agencies and marketers is how you converge technology into mass media first to create awareness, pull and then start going niche. The survival of traditional media will depend on how they converge into new digital media. Sports channels are the world’s best examples of going digital. ESPN, Start Sports, etc, they all have very strong digital media attached to them, so that their audience base is updated on their favorite sports 24/7.”, added Husain.

This is an early warning for brands which are not developing their digital mindspace. These brands are bound to face substantial challenges as older teens & young adults begin moving into the workforce. Not only will non-digital brands find it hard to reach this new workforce, they will be missing opportunities to engage a savvy consumer-force fully conversant with technology and its place in their lives and while admittedly the real impact of this oncoming shift may be a few years off, the shockwaves of the change are being felt even now. The consumer has adopted the immersive worlds of digital media, the bi-directionality of INSperiences which is being manifested in their consumer space and whom they let enter into those worlds. The future is about brands opening their brand stories in a way that allows consumers to step inside. Surprisingly, it is NOT about big shifts. It is about the little ones – the ones that go click! click!