Marketing 2014: Follow, move faster, look further

Kathy Hatzis

Kathy has led consumer and brand marketing for major advertisers, most recently as head of retail marketing at ANZ Bank. She also held head of marketing roles at Westpac, St George and Optus. As client business director at TrinityP3, she specialises in driving marketing effectiveness and efficiencies with digital, creative, media, research and PR agency partnerships for CMOs and their leadership teams.

As Mad Men sat around their boardroom table, drinking scotch and onto their third version of the advertising plan for a big screen detergent ad, print advertising in Vogue and a radio spot, a futurist somewhere else plotted their path. They foresaw a world where every consumer had a device with information, video and telephone device at their fingertips; consumers created content; TV and newspapers curated content online; and advertisers knew what their audiences had read, shared and bought in their lifetime.

If Marketing 1.0 was the era of broadcast media, where behavioural psychology led and the ‘big ad’ prevailed, Marketing 2.0 evolved to be about above the line, below the line and online working harmoniously on the ‘integrated’ idea that advertisers and agencies delivered to the consumer. Marketers measured commercial outcomes, and some agencies did the same. Then the world changed, and we’ve embarked on Marketing 3.0.

With the onset of smartphone usage (Google tell us it’s more than 55 per cent of Australians now) and with digital, social and content marketing accounting for more than 35 per cent of advertising dollars for the world’s biggest brands, ‘engagement’ has become the new mantra.

According to Facebook, there are over 11 million pages in Australia. Under 35s typically access the social media site on their phones every morning before they reach for their barista coffee machine in their designer kitchen. What does this mean for marketers? Simply this: Consumers now lead brands. They also know it. Enterprising advertisers and agencies are the ones working out how to deal with the consumer-led economy and what works under this new era of Marketing 3.0.

Change is happening – but is the industry shifting fast enough?

What Marketing 3.0 means

In 2014, Marketing 3.0 will evolve through three key actions: Follow, faster, further.

1. Follow the customer According to Deloitte’s ASX200 board effectiveness research this year, boards see continued growth through digital transformation as a key risk issue. In addition, the Australian Marketing Institute’s Marketing in the Boardroom guide placed corporate strategy realisation and value creation squarely in the domain of marketing, advertisers and their agency partners.

   Why? Because the digitally savvy customer is at the forefront. Information and insight is enabling them, social platforms are empowering them. New purchase models are unfolding and businesses are reviewing their technology automation to remain relevant. But advertisers aren’t keeping up.

2. Move Faster In a recent CMO survey by Accenture, 65 per cent of CMOs said digital is threadded throughout the company. Yet only 7 per cent claimed to be at the leading edge, and most said their external partners aren’t helping to transform the marketing organisation either. Marketers and traditional agencies are readjusting slowly, while new specialists in digital business integration, content marketing, programmatic media, social media measurement and offshore production suppliers spurning.

3. Look further At TrinityP3, we gain insight into the major advertisers in most industries across Australia, Asia and the Americas. In this new economy, we occasionally ask ourselves: Why does Mad Men syndrome still prevail? For us, there are several practices hindering progress:
   • Many major marketers and their agencies do not share KPIs, yet expect to have aligned views of their successes.

   • Many advertisers are still planning, buying and measuring the cost of media reach, not behavioural impact on more targeted audiences.

   • Media agencies are still benchmarked on price alone, not media value – or payment by results.

   • Marketers are still structuring their agency remuneration based on volume and complexity of activity, not creative outcomes with a commercial purpose.

   • Most advertisers are still creating and producing content the same way they did 10 years ago, when global supply chains and production decoupling by the world’s largest brands has long been proven as effective.

   • Many marketers don’t have a handle on multi-channel attribution: First click, last click and multi-channel measurements.

   • Many marketers are still wedded to the traditional creative and media agency paradigm, yet business strategy, customer journey and execution may be best structured through a hybrid client/agency structure, or through the 3S framework – specialist, strategic and simple needs.

   • Very few remuneration, training and relationship management systems inspire creative thinking and drive innovation for commercial value.

Managing for exhilaration, not exhaustion or extinction

We’ve read it all. Much has changed in marketing, advertising, media and communications with much more yet to come. Customers continue to disrupt value chains, and digital disruption is only going to increase across channels, media, creative, content and production techniques. Marketing guru Seth Godin recently called this new era the “connection economy” - connections with each other as consumers, to (authentic) brands, to global trends.

We know from Moore’s law that technological and social change is relentless and the pace could even accelerate. Managing for exhilaration, not exhaustion will be even more critical in marketing, media, communications. And taking the lead – in order to avoid extinction – is key.

Agencies and clients globally are reviewing their mix of external and internal competencies and their marketing, advertising and communications models more regularly than ever before.

As we embark on 2014 business and marketing planning, it is time to ask yourself: What connection points you will improve between the consumer, business goals and your agencies?

Visit 7 Marketing Effectiveness Challenges for the CMO in the New Economy

Tags: agency management