How AI and Blockchain Will Transform Marketing, Just Like the Internet Before It

In 1995, the Internet was widely considered to be a fad, but businesses that failed to evolve and adapt to a new digital world quickly disappeared. Could the combination of artificial intelligence (AI), blockchain and cryptocurrencies be about to revolutionize marketing in the same way?

After recently watching a clip of a Bill Gates appearance on the David Letterman show in 1995, I was reminded of how our fear of technological change has altered very little in the last 28 years. As the Microsoft leader desperately tried to convey how the Internet would transform everything, both Letterman and the audience laughed and mocked the Microsoft founder.

It’s hard to imagine that in 1995, the Internet was widely considered to be a fad, but businesses that failed to evolve and adapt to a new digital world quickly disappeared. Substantial household names vanished from our lives almost overnight, but we all thought that they were too big to fail.

Here in 2018, we are witnessing the same attitudes towards artificial intelligence (AI), blockchain and cryptocurrencies. However, make no mistake: These technologies will continue to evolve at breakneck speed and will transform every industry including marketing.

Sure, we are in the very early stages at the moment and only just beginning to comprehend the art of the possible. But as these advances in technology continue, every aspect of our world will change forever, and those that fail to keep up with the pace will quickly experience a fate similar to Blockbuster video.

Artificial Intelligence

Nvidia CEO Jensen Huang recently advised that “software is eating the world, but AI Is going to eat software.” But what does this mean for the marketing industry?

We are now living in a digital age where companies are automating how we discover products and services. Anyone who has used Spotify, Amazon, or Netflix will testify how personalized recommendations based on our engagement automatically raises their expectation levels. As a result, marketers will increasingly face pressure to tailor their product recommendations based on their consumers’ purchase history and reviews.

When I open my eyes in the morning, my first action is reaching for my phone to see how many generic emails I can delete, and I know that I am not the only one. AI solutions are already making it possible to offer hyper-personalized ads based on the individual preferences of users and serve them in the right context without being creepy, and right now, they are most relevant.

When this becomes the standard, what happens to marketers who cling to the generic campaigns from the past? Contrary to popular opinion, technology is not dehumanizing us at all; it is actually forcing marketers to treat customers as unique individuals rather than page views and clicks. This can only be a great thing, right?

Blockchain and Cryptocurrencies

Make no mistake: Blockchain and cryptocurrencies will transform the world as we know it. But you might be thinking, how will it impact marketing? Although it will take time for businesses to adapt and use the technology, it has the potential to eradicate intermediaries.

In a post-Cambridge Analytica world, users will have an opportunity to determine how much personal information they reveal in a new era of social responsibility. As a result, advertisers and marketers will need to earn trust rather than take it for granted.

There are already multiple marketing and advertising startups appearing in the blockchain space.  A new approach to tokenize user behavior through a cryptocurrency and create a new credit system to unite advertisers and the consumer could completely remove the need for middlemen that provide little in terms of value.

When thinking about the art of the possible, blockchain could easily enable brands to build trust directly with their customers. Could this pave the way for businesses to be less reliant on tech behemoths such as Google and Facebook? Only time will tell.

Tech, The Problem Solver

The marketing industry has a long list of problems that emerging technology could quickly remove. Whether it is payment processing, fraud prevention, measurement, or reporting, we can expect everything to become simplified and in many cases automated.

Technology is bringing greater trust and transparency to the global marketplace across every industry. Marketing is just a small part of this huge digital transformation of everything.

Ask yourself: What are the most significant pain points in marketing? What aspects of the current ecosystem are no longer fit for a digital age? And what value are complex processes or third-parties providing your business? These are the areas that technology will eradicate over the next five years.

As consumers, we can access anything our heart desires with a few swipes of our smartphone. We are all taking these expectations into the world of B2B and demanding the same level of experience. Those that fail to make it easier to do business and remove friction points will quickly fall out of favor.  So, isn’t it time that you embraced technological change rather than fear it?

Facing the Future

Recently, I participated in a panel discussion at a major e-commerce conference. The topic was about the “Future of Marketing,” and naturally, the discussion went towards the Internet of Things and other futuristic technologies. The key question was, “How should marketers adapt to these rapidly evolving technologies?”

wwwRecently, I participated in a panel discussion at a major e-commerce conference. The topic was about the “Future of Marketing,” and naturally, the discussion went toward the Internet of Things and other futuristic technologies. The key question was, “How should marketers adapt to these rapidly evolving technologies?”

In a panel discussion, where panelists are supposed to share the stage with others, there generally is no time to build up a story. Nor does the modern-day audience have patience for a long intro. We’ve got to get to the point fast. The bottom line? Technologies change, but people don’t.

Well, they actually do change over time, if you want to be technical about it, but the whole premise of predictive analytics (and the reason why it works) is that people are predictable. Hence the phrase, “Past behavior is the best predictor of future behavior.” Even the manufacturers of products aren’t sure what is going to be invented in the near future. People, on the other hand, unless there are life-altering events such as getting married or having a baby, change “relatively” slowly.

Yes, new cool things come and go, but the early adopters of technologies will remain in search of cool new things and adopt them earlier than others and at a higher price point, movie collectors will collect movies in new super-duper-ultra-high-definition formats (ask them how many times they bought the “Godfather” trilogy), conservative investors will invest more conservatively, fashionistas will care more about the latest fashion than others, and outdoors enthusiasts won’t be flipping channels on TV on weekends unless they get injured doing outdoor activities. Here, I am also describing the reasons why product-to-product type personalization (as in “Oh, you bought an outdoor item, so you must be in interested in all other outdoorsy stuff!”) is mostly annoying and impersonal to consumers.

So, if (more like “when”) some smart person – or a company – invents a new way to communicate among people, marketers should NOT create a new division for it (like a social media division, email division, etc.). If wearable devices, such as watches or eyeglasses, become really smart and ubiquitous, I am certain some marketers will simply see the new invention as a piece of real estate where they will put their so-called “personalized” ads. From a consumer’s point of view, that would be the last thing that they would want to see on their new toy. You think that a banner is annoying on a computer screen? Try a 3D image projected out of your glasses, promoting some random things.

The first thing that a marketer must face is that all of these new devices will be connected to a network for “two-way” communications, not one-way blasting. It doesn’t matter if it is a watch, eyeglasses, set-top-box or even a refrigerator. IoT is essentially about data collection, not about marketers’ new sets of billboards. And the price of spamming through such personal devices – especially ones that people will wear on their bodies – will be quite stiff. My advice? Don’t do it just because you can (refer to my earlier article “Don’t Do It Just Because You Can”).

The second bit of advice is that marketers should not forget that they are NOT in control of communication. Consumers will cut out any conversation if “they” think that the message is irrelevant, intrusive, rude or simply uncool. Millennials are in fact less likely to be resistant to sharing their information on the Net, if “they” think such action will yield some benefits for “them.” The second that they decide it is a waste of their time or not worthwhile for that small space on the phone, they will mercilessly opt out and delete the app.

So, if a marketer thinks that all of these new devices will serve “them” as part of their multichannel arsenals, well, I am sorry to inform them they are just wrong. Call it any name you want, whether it is personalization, customization, customer experience or whatever, the key is staying relevant at all times. The goal should be keeping engaged without being fired by the new generation of impatient and tech-savvy customers. In fact, marketers have lost control over this matter already; the sooner they realize that, the better off they will be.

Then there is this data part. All of these new technologies will yield more data for sure, as the very concept of “connection” is about knowing the who, when, what and where of every event, maybe with an exception for the “why” part (remember the age-old argument that correlation doesn’t automatically mean causation?). That means this Big Data thing will get even bigger. Many companies don’t even know how to deal with transactional data or digital data properly, and they barely consume basic reports out of them. Most don’t have any clue about how to convert such data assets into real profit. A few have some idea that personalization is the way of the future, but may not know how to get there.

Now multiply all of those data challenges by a million to gauge the size of the data-related issues when everything that consumes electricity will start spitting out some form data at us. Bless those electrons and charged particles; now they will soon know to how to talk to us.

How do marketers get ready for such a world? I think the way our brain works may provide a clue, though I am not getting into a new discussion regarding machine learning at this point. Our brains, basically, are programmed to know what to ignore; they simply do not process everything that we see, hear, taste or feel. Many women complain about their male partners’ selective hearing, but in the age of abundant data, analysts must learn from those seemingly simple-minded men.

Big Data are big because we don’t throw away anything. Data that are useful for one purpose could be dismissed as worthless noise for others. Basically, Big Data must get smaller to make sense for decision-makers (refer to my earlier article “Big Data Must Get Smaller”).

There are movements in Silicon Valley to build a machine that would just provide answers out of mounds of data, much like the one in a satire movie called “The Hitchhiker’s Guide to the Galaxy.” I dare you to say that even such a machine must go through some serious data selection/reduction processes first in order to provide any useful and consumable answers. Anyhow, even with such an omnipotent computer, the humans are the ones who need to ask the question wisely. If not, we will get answers like “42” for “The Question of Life, the Universe and Everything,” after 7.5 million years of calculation. That computer named Deep Thought in that movie actually pointed out that “The answer seems meaningless, because the beings who instructed it never actually knew what the question was.”

So, how are we supposed to ask questions in the age of abundant data and ubiquitous connections? Let’s remember that ultimately, marketing communication is about pleasing other human beings and treating them right. If that is too much, let’s start with not annoying them through every device and screen ever invented.

Then, how do we become more selective? Invest in analytics, and start cutting through the data before it is out of control. Why? Because consumers are in control of all these devices, and they will cut out any marketer who doesn’t conform to their standards.

We may never really know why people do what they do, but let’s start with talking to them only when necessary with a clear purpose, and offering benefits to them when we do get to talk to them. Modern-day analytics can already provide answers to such questions with available technologies. It is a matter of commitment, not technical challenges.

I really don’t think the future will be brighter just because we will have better technologies. Imagine spams through every device that you possess as a consumer. I, for one, would give up a talking refrigerator and all the benefits that come with it, if it becomes even remotely annoying to “me.”

Your Future Is Beyond Advertising

I’ve been covering marketing for almost a decade now between Target Marketing and Catalog Success (not to mention some work with EM+C, All About Email and a few others). One word I say far less than I ever thought I would is “advertising.”

IcebergI’ve been covering marketing for almost a decade now between Target Marketing and Catalog Success (not to mention some work with EM+C, All About Email and a few others). One word I say far less than I ever thought I would is “advertising.”

That’s because, when you look at where marketing is now and where it’s going, it’s clear the future is beyond advertising.

That doesn’t mean advertising — paying to run ads on TV, radio, the Internet, your friendly neighborhood Target Marketing magazine, or anywhere else — is going away. But the universe in which you communicate with your customers and prospects has changed, and so has the role of marketing in the company.

Ads used to be the centerpiece, now they’re just the tip of the iceberg.

The customer journey might start there, but it’s going to run through miles and miles your own emails, content, demos, reviews, social media, direct marketing and customer service. And those extra miles do more to define your brand to those people than any ad ever could.

Going Beyond Advertising

One marketing expert who’s very aware of that is Dr. Yoram “Jerry” Wind, lauder professor and professor of marketing at The Wharton School, founding director of the Wharton SEI Center for Advanced Studies in Management, and primary author of the book “Beyond Advertising: Creating Value through All Customer Touchpoints.”

Wind will also be the closing keynote speaker at the Integrated Marketing Virtual Conference on June 23. And 10 attendees to that session will win a free, autographed copy of the book “Beyond Advertising!”

“Beyond Advertising” is based on a multiyear, in-depth study of marketers and agencies throughout the world designed to learn how marketing will look in 2020. The conclusion they came to is that marketers are going to need to be able to manage the customer experience to create value across all their touchpoints with your company.

The book gets into the forces of change that you can harness to propel your company where it needs to be, as well as the mental models that you need to challenge because they stand in the way of change. And Wind will talk about those during the keynote, too.

Wharton Value Creation Model
This all touchpoint value creation model is step three in the Wharton Beyond Advertising Roadmap, and puts the emphasis on creating value for your target customers, rather than brand messaging.

What I want to focus on here is the all touchpoint value creation model that emerged from this study, outlined in the image at right.

The core idea of the model is that someone needs to be orchestrating the elements of your company that touch the customer, which is very nearly all of them.

If you align your products with the goals and community orientation of your target customers, provide a unifying brand focus that rallies the people in your company with those goals, and orchestrate all of your customer touchpoints to deliver experiences that reinforce that focus and help your customers reach those goals, then you are creating value for your customers at all touchpoints and become more than just another commodity in their lives.

In this model, you’re emphasizing the types of interaction that add value for your customers, and advertising represents just a couple of those touchpoints.

You can hear more about the M.A.D.E.s and R.A.V.E.s in the interview I did with Wind earlier this year.

http://bcove.me/4raqv74j

What it all comes down to is marketing is becoming more important to companies and customers, while advertising itself is becoming a smaller part of it. Thus: The future of marketing lies beyond advertising.

What skills do you need to make sure your marketing, and your career, are effective in this new situation? Click here to register for the Integrating Marketing Virtual Conference on June 23 and hear it all from Jerry Wind himself. And if you do that, you’ll automatically be entered to win a free, autographed copy of “Beyond Advertising”!

I hope to see you there.