The real digital revolution has nothing to do with advertising or marketing. In fact, it’s the mortal enemy of advertising and marketing.
Because the real digital revolution is about consumer empowerment, the ability to research and learn about products and services and make decisions independently from, and in spite of, any sort of marketing and advertising messages.
That’s what’s really changing the way we market. It’s not about our inability to control the conversation. It’s about our inability to even get in on it. “They” are talking about us and we can’t butt in. I mean Word of Mouth is wonderful and all, but it ain’t got nothing on a glowing review from CNET.
The car companies are actually the ones who are hardest hit by this development. Given that a car is the second most expensive purchase you’ll make in your life (your home being the first), sophisticated consumers are flocking to review sites, message boards and the like to get the real deal on the car they plan to buy. And even to find out what kind of car someone like them should buy. A pretty shocking development in a market that was shrouded in mystery and misinformation for years.
Sure there was Consumer Reports and the car magazines. But Consumer Reports attracted a very specific, Naderesque demographic and the car magazines were rarely concerned about the sorts of things the average car buyer was concerned about, especially if the average car buyer had kids or mostly used the car for commuting.
Now what all this information does is destroy the power of image-based brand advertising. I might see some “this car is cool” VW ads and think VW is great, so great that I decide I want to buy a Jetta for my next car. But, if I go online and read about how much the Jetta sucks and how much better the Nissan Sentra is, I’m buying the Sentra. No matter how much Marc Horowitz (the guy who lived in his Sentra for 10 days) bugs me. Brand advertising can’t stretch the truth anymore or try and gild the lilly. Because if it does, we’re going to find out about it and it’s not going to be pretty.
The informed digital consumer isn’t just a threat to the auto business: S/he’s a threat to any business where there are objective standards for judging the product. So while something like food may be immune (you either like Oreos or you don’t, there’s not much objectivity there) even packaged goods like laundry detergent can fall vicitm, since there’s an objective standard for how clean your clothes are getting.
All the noise you hear from the 2.0-niks about “conversations” is often just a fancy term for people sharing objective opinions of products on review sites, blogs and other digital media. The “conversation” is when the marketer responds to criticism with a pledge to try harder or some such. Which, while it’s not practiced as much as it should be, is just common sense. But enough “conversations” about how bad your product is, no amount of clever advertising or radical media placement is going to save it.
Now people are people and of course we’re always going to need some sort of brand advertising to help us distinguish between the cool brand and the not-cool brand. But, especially on high ticket items, the ability to research, to learn all the details and facts that were previously unavailable to us— that is what is ultimately going to drive our purchase decision.
And that, my friends, is the real digital revolution.
Nice (and provocative) article, TToad. Of course, the underlying assumption is that the objective information about a product is somehow more important to the decision-making process than the emotional component. I’m not sure that really applies — even to major purchases like a car. It might for some, but certainly not for everyone.
Most people don’t buy a house based primarily on the square footage or the thermal efficiency or the taxes. They buy it because they fall in love with the kitchen (or whatever). And most people still buy a specific car because it appeals to their self-image.
I agree that the digital revolution has made a major difference in the information flow and put a new kind of power in the consumer’s hands. But I think it’s a little premature to declare it as “the mortal enemy of advertising and marketing.”
One more thing: Marketing is all about understanding and satisfying important consumer needs. The digital revolution hasn’t changed that. People still have needs, and there’s still an opportunity to satisfy those needs and make money in the process.
I like the direction you’ve taken, but I think it’s not literally true … at least not yet. ” … mortal enemy” is a bit exaggerated, no?
TT, you make a good point about how there needs to be “enough conversations” -presumably negative– to convince me there’s a disconnect between the brand and the promise.
On review sites, I’ll always look for a decent sample size. It doesn’t need to be statistically relevant, but a sample size of say, five, and they’re all bad reviews–is just another data point in my decision making processes.
TT,
Interesting article, but I would have to agree with Goodman that there are intangibles that can’t be qualified in this equation.
Check out this interesting article in BusinessWeek: http://www.brandweek.com/bw/news/recent_display.jsp?vnu_content_id=1003661741
It discusses the proliferation of the fake reviews and marketers trying to infiltrate opinion sites.
Seni
Toad,
Good thought-provoking piece.
I can’t speak to advertising in this environment, but I can speak to other tools within the marketing genre: Instead of seeing a glass half-empty, I see a glass half-full.
First, consumer empowerment is good for everyone, as it should result in better products and services to meet wants and needs instead of the bottom line.
Second, smart marketers will turn to listening and responding instead of speaking and shouting. By doing so we join consumers in creating a great opportunity to turn us marketers into excellent sources of credible information, if we take the time to honestly communicate about our products and services in ways that meet our listener’s wants and needs instead of the bottom line.
To me, the new tools are just tools. I suspect that someone once said that “Consumer Reports” and “Consumer Digest” represented mortal enemies of marketing. They didn’t and still don’t. Social tools don’t either.
Marketing is not about tools, it is about helping people make good decisions, objective ones that meet their wants and needs. Sometimes that results in people buying our products and services; sometimes the results are they they buy our competitor’s products and services.
Toad,
Who are you personally more likely to trust: a bunch of faceless names posting comments on blogs and social media sites, or the WOM of trusted family and friends who have experienced specific products or services firsthand?
The recent Nielsen report I cited in my post a couple of weeks ago, points to the latter.
I also think Michael, Paul and Seni have raised some very strong points here. While you make a good argument for your point of view, I agree with Michael, that it is a bit premature. Thanks for a provocative post, Toad.
@Michael & Seni: Yes, the opening paragraph is (intentionally) provocative, but I do talk about the power of image in the decision making process, especially on parity products. My point is that the brand has to live up to the image, which is often not the case. And that you can no longer sell a brand solely on image, least of all a not-very-well-thought-out product or service.
@Michael: Your real estate example is a bit off. People do so much research online now before they buy a house: neighborhood, price, resale, value of upgrades, etc. They will narrow in on a location and then fall in love with the kitchen, but they will not just buy a house b/c they love a kitchen anymore. (My family is in the real estate business- I can personally attest to the major impact digital has had on the industry.)
@Seni: I’d seen that article, thanks. I think most people know how to use review sites. So that if say out of 100 reviews, 85 of them say “the handle fell off within a week” they believe it, versus a handful of mixed reviews or a few that seem apart from the mix.
@Lewis: I agree. It just means we need to be smarter about how we market. And that companies need to be smarter about WHAT they market: you can no longer have a sub par product and expect it to succeed.
@Ted: WOM is wonderful, but there’s a world of products where there is no WOM. Maybe I don’t know anyone who’s been to Aruba or bought a Volvo or likes shopping at Nordstroms. People take online opinions for what they’re worth, especially on objective matters. But if I’m debating between two fairly similar cameras, I’m going to give more weight to an “expert” review than my decidedly non-expert neighbors review. Though I will take both into consideration.
Gerd Geigerenzer, in his book “Gut Feelings,” reports the results of some research among hundreds of German and American students. They asked the students, “Which has a greater population — Detroit or Milwaukee?”
What they found was that the German students got the right answer (Detroit, for those who care) 90% of the time, while the American students got the answer right just 60% of the time.
The reason, according to Geigerenzer, is that most of the German students had never heard of Milwaukee, so they selected the city they’d heard of. American students actually recognized both, knew they were “major league” cities, and basically flipped a coin.
In this case, says Geigerenzer, it’s an advantage to have less information.
I think the application of the principle in marketing is clear: Sometime you’re better off just having brand awareness. Too much information can confuse the consumer and lead him/her to the wrong decision.
I like researching on the Internet too, but I recognize that most often the familiar brand name may be the right choice.
P.S. Geigerenzer then reversed the test and used two German cities. The result? American students 90%; German students 60%.
While that’s certainly an interesting anecdote you have there, I’m not sure I’m following you Michael.
There are precious few categories where I’m choosing between a familiar brand and an unfamiliar one. It’s the Canon vs. the Sony, the VW vs the Saab.
Online research lets me choose between products from familiar brands in my consideration set based on objective standards.
And yes, the brand advertising (as opposed to product advertising) is what helped to get them into my consideration set.
But if I get online and find that the ads were lying to me, then you’re doubly screwed. And if I find that there’s a significant difference in quality between two familiar brands, I’m going with the one that’s clearly better.
Whereas 20 years ago, I was flying blind, relying on the ads to give me information.
I’m a mortal enemy? Can I be enemy #1?
What all this means is music to this evil genius’s ears…that marketers need to do their core jobs and create products/services/experiences that are exemplary.
And take care of customers.
Then they won’t talk badly.
And when you type in Product Name + Sucks, their products won’t come up.
I like this era. It’s a return to value…instead of faulty tactics that compensate for lack thereof.
signed,
BIG Bad
Well said, TToad, I think listening is one of the most important things we can do in life and business.
I think Dale Carnegie had it right back in the ’30s.
What happens when you do your research on “objective” criteria, and you find lots of information on one brand and relatively little on the other. Do you opt for the one with lots of information (assuming most of it is positive), or do you “flip a coin,” or do you disregard what you’ve learned and revert to selecting based on more subjective criteria?
The Geigerenzer phenomenon would suggest that sometime you’re better off with less information than incomplete information.
P.S. I’m not arguing that Internet research is a bad thing, only that it’s probably overrated for many pruchase decisions. And most purchase decisions are probably based more on brand image and prior experience than on objective specs.
Well Michael you do love that theory now, don’t you?
Problem is I can’t think of many instances where I’d find “lots of information on one brand and relatively little on the other” – especially in regards to major consumer purchases.
But yes, if such a situation were to exist, if CNET were to say decide to only review Motorola phones and not Nokia ones, then we’d have a different situation on our hands.
When I was in high school the most important purchase anyone could fathom making was that of a component stereo system. We would compare speakers and amplifiers and cd changers (remember cd changers?). I can also remember the best piece of advice I ever got was from another budding audiophile (and I mean that in the quaint way that a seventeen-year-old can be an audiophile) who told me that, “considering how much money we actually have to spend, there’s no reason not to buy a Sony.” His reasoning was that at the price point we stood in the market, there would be a precious little discernable difference in quality that we’d be able to afford, and further, that Sony’s impeccable reputation was more than enough reason to ignore any chatter one might have absorbed via the pages of some magazine. Now I agree that being empowered by information on the ‘net has steered me away from a couple of purchase errors in my day, but I feel like brand reputations are as relevant as they’ve ever been in making many purchases. After all, if I’m looking at a bunch of similarly-priced and reviewed items, what else do I have to go by? Case in point, my most recent digital camera purchase. I walked in sans-research, compared the two models that had similar price/form factor, and walked out with the brand that my dad buys (a photojournalist). I’ve been completely satisfied with the purchase.
A good reason to go with heavily advertised brands rather than getting caught up in tech specs: If a “major purchase” manufacturer advertises heavily to build its brand image, they probably expect to be around for awhile. They certainly wouldn’t make that investment if they thought they’d be gone before the next purchase cycle.
That probably correlates with conscientious corporate management that takes its positioning promises seriously — the kind of company most of us would like to do business with.
It’s not a perfect indicator, of course, but it may ultimately be better than comparing BTUs, dimensions, energy efficiency, weight, speed, price and other “objective” measures.
I think the system actually works pretty well.
@Raafi: I hear you, but I guess the question is: Why did Sony have such a stellar reputation? Was it their brand advertising? Or was it the fact that they made a really good product and even back then you sort of knew that you wouldn’t get screwed buying a Sony.
The companies who are screwed by The Real Digital Revolution are the ones making sub-par products. They can’t cover that up with glossy advertising any more.
“Why did Sony have such a stellar reputation?”
They had a reputation as both innovative + solid. I remember, ahem, when Sony was “all the rage” with their walkman. That was when music became really mobile…sure, there was the boombox, but the walkman was small (again, at the time).
Now, I just trust Sony products as being solid. However, I would still check-out reviews before purchasing. Had I checked out Toshiba laptops before I purchased one a year ago, I wouldn’t be in the mess I am now (well-documented shut downs for HOURS). Now I view it as the onus being on ME (vs. the manufacturer) because I have the all-too-easy ability to verify quality.
So marketing/advertising informs me…and entices me. But WOM validates my purchases for big-ticket items.
and here I thought transistor radios made music mobile
Kidding aside, we are all honing our listening skills in the real media revolution…and that makes the market a better place. Thanks for the tip on Toshiba, CK -