We’re living in an age of unprecedented change. We experience with Oculus Rift, invest with Acorns, consume video through Hyper, tune into Pandora and navigate with Waze.
Consumer behaviour is changing more rapidly than ever and businesses and marketers are lagging behind.
In celebration of her new book, Closing the Gap, BrandHook CEO and founder, Pip Stocks, collaborated with Publicis and CMO to host a panel of marketing and thought leaders in Sydney discussing the challenges brands face trying to better connect with customers in today’s competitive marketplace.
“We’ve seen a lot of changes in consumer behaviour and businesses are finding it hard to keep up,” Stocks told attendees. “We’ve always had consumer behavioural change but not so quickly and dramatically, or with such great impact on brands.”
Stocks noted a 2014 IBM study asking global CMOs how they felt about digital transformation, which found just 30 per cent felt ready.
“For us, this was another obvious sign that there is a big gap,” she said. “Consumers are already changing their behaviour, but businesses are just lagging behind.”
One of the most significant changes is that consumers are more in control. According to Stocks, marketers are getting scared about this.
“Consumers are also researching things differently, and looking at peer-to-peer forums like TripAdvisor,” she said. “In fact, Nielsen conducted a study revealing 90 per cent of consumers trusted their friends and associates when it came to what to buy, as opposed to a traditional TV ad.”
CEO of creative and digital agency Publicis, Andrew Baxter, agreed this lack of control can be confronting to marketers.
“Consumers have had control for quite some time now,” he said. “They have become a lot smarter and social media has played a huge impact. But I think the biggest element in this is data. Consumers now expect brands to have data on them and know everything about them to provide a more personalised experience. We’re seeing that even with the banks and airlines.”
Photographer and creative director, Kristian Taylor-Wood, said it’s also getting harder for creatives, noting advertising budgets are getting slashed yet everyone still wants a lot more content.
“People want videographers and behind-the-scenes photography, and I’m having to cover a lot more and be a jack of all trades,” he said. “That can be very negative in some ways, but in other ways it can be very positive and help us to push creative boundaries.
“For instance, last year I campaigned for the Australian Cancer Research Foundation and shot 20 portraits of different people, which we made into a moving and interactive cinema-graph showing the changing face of people who cure cancer.”
Are consumers less loyal?
In spite of having more choice and information than ever before, Luxoticca’s VP of marketing, Jee Moon, doesn’t believe consumers are less loyal to brands today than they have been previously.
“From a marketing perspective, I have so many ways I can reach my customer and engage with them and I don’t have to break the bank with big TV productions,” she said. “An email costs me a tenth of a penny per customer, as opposed to thousands. So the ways in which we can engage with customers can help further generate that loyalty and can be much more accessible. In many ways, the power is in our hands as marketers, but the challenge is how we choose to use it.”
CEO of marketing and entrepreneurial consultancy The Impossible Institute, Dan Gregory, saw the key to loyalty as simply being the brand that loves the customer more. While brands with big budgets can always find a way to bully us into buying, he said an opportunity exists for more agile, smaller organisations to build loyalty by being more targeted.
“We run a program for small businesses and there was a photography school that was offering generic types of photography in the marketplace. As a result, they struggled,” he explained. “We helped them focus on a specific genre that the owner enjoyed, which happened to be children. All she does now is teach new and expecting parents to take great photos of their kids. And she loves that group better than anyone else does.
“That group congregates in communities online in forums like mothers’ groups and evangelise on her behalf, which costs the photography business next to nothing. But what drives that loyalty is she simply loves that particular cohort better than anyone else.”
The art of faking authenticity
Panellists agreed consumers increasingly expect brands to be more authentic, which is now one of the key drivers to brand success.
“If you can find that nugget that helps people feel good, then they don’t think it’s fake or bullshit, because it’s about that feel good factor,” Stocks said.
Taylor-Wood believed the authentic driver is as much a cultural shift, and one that he’s seen in particular with the film and TV industries.
“We’re entering an era where we’re increasingly demanding being completely immersed in our entertainment,” he said.
But one of the things that frustrated Stock over the years is the amount of money brands are spending on building their consumer practices.
“There’s a lot of rhetoric about it, and you’re still seeing these massive media spends,” she said.
At Luxoticca, Moon said she decided to focus on building a consumer practice mainly because that is what makes her tick and makes her excited to go to work.
“Despite all the changes in digital and technology around us, our drivers, needs and motivations and basic desires as human beings have not changed in hundreds of years,” she claimed. “I think getting in touch and tapping in that gives brands a lot more resilience.”
Closing the Gap was released off the back of Pip Stocks’ successful podcast series, which was published on the CMO website.