Archive for the ‘digital strategy’ Category

lethalLethal Generosity: Contextual Technology and the Competitive Edge – Shel Israel

Let me say from the outset: Most adverts suck and I hate being marketed at. There’s a special place in hell for people who pollute my digital stream with pop-ups.

And for creators of pre-roll commercials that play unprompted, I have reservations for you in Hieronymus Bosch corner where you’ll be assured of extra special attention.

Given how much data I’ve surrendered and the liberties taken with it you, the marketing and advertising people, really should be doing better but old habits die hard.The banners you place are as welcome as wasps at a picnic and yet you persist with your poorly-targeted petitions urging me to click, to endorse, to buy, items of which I have no need, nor interest.

When you take people’s money and use it in this way how do you convince them that it’s good for business? It escapes me. If the messaging subliminally enters my head at all, it registers as the don’t-touch-this-with-a-bargepole kind.

Happily there’s a shake-out on the way and digital dinosaurs that use new technology to deliver old marketing methods will be flushed away with the detritus they promote.

In Shel Israel’s latest book, Lethal Generosity, he declares that the balance of power is shifting from sellers to buyers and “traditional marketing, even in digital form, often damages the brand trust it attempts to establish”. Halleluiah!

In his previous publication, Age of Context, co-written with technologist Robert Scoble, much of Israel’s emphasis was on connected data using time, place and context to deliver better customer experiences.

This sequel continues that theme but looks more closely at how technology and social change affects retailers and other public-facing businesses. Get it right and customers become loyal brand advocates, get it wrong and the results can be devastating.

Successful bricks and mortar businesses have always known this as evinced by the maxim: “The customer is always right”.

In the UK, department store John Lewis stands behind its slogan “Never Knowingly Undersold”, Marks & Spencer identifies with value and a quibble-free returns policy and Nordstrom is known for its exceptional service

“Treat customers as relationships to open, rather than as sales to close”

Good as they are, success in the past is no guarantee of success in the future. Shifting social and demographic trends plus new devices and new expectations mean upstart enterprises can swiftly undermine the foundations of even established businesses.

Just seven years after its launch in 2007 Airbnb became the world’s biggest hotelier, yet it doesn’t own a single hotel, or room, or bed and has fewer staff than a modest hotel chain.

It’s a software strategy eating into the profits of bricks and mortar businesses, one that The Economist predicts will cut hotel revenues by 10% by 2016.

Israel warns companies to actively listen, to treat customers as relationships to open, rather than as sales to close, and to treat them in a generously memorable way – even if it means sending them to a rival.

It’s easy to write about, much harder to do, and there are multiple examples of behaviours from companies that he thinks are on the right track and others that are getting it wrong.

Uber is a good case in point. At one stage, Uberize Everything was Scoble’s suggested title for the book but, wisely, given the controversies around the brand, Israel thought better of it.

Still, Uber stands as an example of a company that began with customer service at the heart of its operation and one which has delivered new norms of expectation from cab users.

There’s a really good segment on why millennials matter – they’re digital natives, the largest age-based demographic, born in the age of context and influenced by peers more than brand messages – and a  follow-on chapter about kieretsus, a Japanese term for interlocking relationships between businesses which millennials favor.

Beaconing customers, frictionless interaction, contactless marketplaces and human-centered design all lead on to what Israel calls: The Road to Pinpoint, where “close, personal service is scalable on a global level for the first time”.

Never mind the marketing-speak, for our world to become that personal we’re going to have to get comfortable with much greater levels of intrusion, data surrender and secondary uses of that data. Who owns it, what can be done with it and where should the boundaries be drawn around individual rights to privacy?

The answers to those questions are likely to be different for everyone and will be traded between perceived usefulness of a service and the amount of information required to be given up for it.

Israel covers a lot of ground in his dash towards the future and doesn’t dwell on this since it had an airing in the Age of Context book.  But with so many data breaches, so much hackery and so much suspicion about data mining, breezing over this topic gives the book an unrealistically optimistic outlook. It’s a safe bet that the spammers and scammers, crooks and chancers, won’t be far behind.

No matter, it’s still a great starting point for businesses to re-evaluate what they stand for and to look at ways they can deepen customer relationships, gain market share and increase profitability.

Whether you’re won over by the conversational tone and largely anecdotal evidence will likely depend on:

  1. How closely your views align with his
  2. Your technophile/technophobe tendencies
  3. What your peers say

The last word goes to the author whose final paragraph reads: “Entrenched brands may shrug all of this off. They will point out that they are doing just fine, that this is just a prolonged down cycle, and they will keep doing what they have always done. They will be the earliest victims of lethal generosity.”