23 Nov 2015

Business concepts degraded to marketing buzzwords are causing strategic havoc

Digital has never been more experiential and

23 Nov 2015

Digital has never been more experiential and immediate, yet it’s also never been harder to find ways to reach and influence people. Technology vendors warp and mutate business concepts to sell strategies, marketing tools and platforms to businesses, but divining what will be successful to reach a new customer and associated organizational models is a huge challenge

We all know smart phones, always-on connectivity and cloud technologies have fundamentally changed the way we behave in all areas of life. Sometimes it seems the only people who aren’t as aware of this as they could be are the people who run technology infrastructure inside companies.

The pace of change is only increasing, but with that comes some remarkable rhetoric, distortions and fear mongering from vested interests in the tech industry, and opportunistic sniping of existing business opportunities by full stack start ups.

Some of the charismatic characters who have emerged from the advertising and pr world to become self created experts in digital are being relied on to lead businesses through the technology jungle, yet are ‘cargo culters’ who have never worked in large companies or designed real world strategies.

Customer experience (‘CX’) is a massive marketing obsession this fall, particularly as the digital marketing world appears to be falling apart at the seams. The dot come era was always ‘about to come up with something more than banner ads’ on web pages before that financial bubble burst.

A useful blog post on Idlewords’ the advertising bubble’ points out similar fissures in the highly complex thickets of digital advertising firms we have today. Essentially there isn’t enough money to go around to justify the expense of capturing people’s attention to sell them things online and the digital ad industry bubble is bursting.
Paraphrasing the basic premise of the faustian bargain we strike to be told about things we might be interested in: “A customer pays money for a good or service….In essence, we pay a small consumption tax to fund advertising”.

However,

“There’s more money being made from advertising than consumers are putting in.
The balance comes out of the pockets of (advertising technologies) investors, who are all gambling that their pet company or technology will come out a winner. They provide a massive subsidy to the adtech sector.
But investors want to be on the other side of the equation. Instead of pouring money in, they want their money back, plus a handsome profit”.

The brass ring everyone is grasping for is the delighted customer, with the goals being the best experience of their lives while discovering, buying and using the goods or services on offer. Quite apart from the silent snooping every time you go to a website (trackable on Ghostery and as a browser add on here) by countless sets of business eyeballs, the sense of claustrophobia and cynicism from ‘consumers’ is palpable now we are in a rapidly maturing digital marketplace. Few enjoy hard sales interactions when browsing in a store, and the same is true online.

Just like dot com era banner ad evolution, the promise of ever greater relationship building with the digital customer is challenging…not least because attention spans are shrinking to the single second and patience is practically zero in our mobile first world.

Personally I like most people shop on price and availability almost exclusively, relying on digital reviews and perspectives on products and services before making final decisions. This price pressure is crushing when combined with the need to maintain high standards of customer satisfaction.

It’s not rocket science to understand these realities, but the mess in the digital advertising and influence world has caused mass confusion amongst buyers, including some short tenured Chief Marketing Officers. Most of the foundational logic and concepts around digital have been distorted beyond all recognition and amplified as advertising rhetoric.

There’s a good common sense piece by Clay Christensen in HBR this week ‘What is Disruptive Innovation?’ , the latest in his regular posts that clear up ambiguities and distortions of the term, which gets back to basics about what ‘disruptive innovation’ actually meant when he originated the term.

The theory of disruptive innovation, introduced in these pages in 1995, has proved to be a powerful way of thinking about innovation-driven growth…Unfortunately, disruption theory is in danger of becoming a victim of its own success. Despite broad dissemination, the theory’s core concepts have been widely misunderstood and its basic tenets frequently misapplied“.

….Many researchers, writers, and consultants use “disruptive innovation” to describe any situation in which an industry is shaken up and previously successful incumbents stumble. But that’s much too broad a usage“.
I recommend reading the short article to get Christensen’s definitions verbatim.

Some of this is academics keeping their core premise pure and marketable, but it is fair to say that most executives roll their eyes when they hear words like innovation, disruption and transformation these days. they have been beaten to death with conferences, after dinner speeches and crude marketing rhetoric that leverage these words to sell agendas, products and services.

Taking a machete to chop away all the marketing cruft, posturing and hype that has crusted around the application of simple, powerful ideas in the tight context of solving specific business problems has never been so difficult in a world where many are distracted by endless digital red herrings, shiny objects and charismatic figureheads.

Having said that, Claytons concepts are evergreen business quality theory, but they are pre internet and therefore sometimes of questionable relevance to some specific business cases today, even a distraction. Given the rapid pace of evolution in where business opportunities are around digital there are grave dangers in becoming seduced by boilerplate frameworks, not least of which is the almost generic fear of ‘Uberization’ of markets, which will be the subject of my next post.

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