Marketing enters a behavioral age
Behavioral marketing is a technique used by online publishers and advertisers to increase the effectiveness of their campaigns
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All those apps out there have a lot to answer for. In one stroke, they have made it just that much more difficult to pinpoint with any degree or precision how consumers engage with the universe of brands and branding campaigns that swirl around them.
The consumer sureties that existed when print, television and radio were dominant and those that marketers swore by no longer apply. Even if they do, their significance has eroded.
This is all the more reason why Shadi Kandil, managing director of the media buying and market research firm OMD’s UAE operations, is intent on creating new tools to determine consumer behaviour. And it’s being done more or less on the fly.
What Kandil and his team are working on is one part science and one part related to what we may have seen in highbrow sci-fi movies. His task: to bring in elements of behavioural economics and marry it with a neurological process into market research tools. Yes, making it happen is as difficult as it sounds.
Dubai is one of the five global markets in which OMD has been testing the process in the past year. With a major conference opening next week and organised by OMD, Kandil outlines what it all means.
Question: Why is there this sudden desire to change the way marketing research tools are employed?
Answer: Next week’s meeting basically talks about the macro-level thinking in the media industry. For the last two years we’ve been hit by two predominant trends. The first is obviously a factor that came out of the recession, which led basically to more clients and marketers getting obsessed with productivity and ensuring that every investment they do actually maximises returns. To do that the first port of call would be having greater amount of data and analysis available. That’s one dominant trend that came about starting 2009.
The second was the realisation that we can no longer keep up with change on the technological side of things. On the digital front, it’s a platform that is ever changing and mushrooming into sub-platforms every single day. One has to be able to keep up with the plethora of channels and present opportunities for marketers to engage with customers. One needs to be able to identify them, able to monitor them and create links with every single investment made and what the outcome will be for the customer.
Does it mean creating new tools?
You don’t have to create new tools, it’s already there. You have to put your hand around them, understand how consumers are behaving on these channels and then try to measure the impact on your activity.
In the year of its launch, Apple sold ten million iPads — that’s ten million new customers engaging with a new platform. The Apple store has now hit one billion applications. Just think of the sheer number of applications that are out there, getting downloaded and engaged with. One needs to drill down to that kind of information, down to its most granular level and try and understand it.
In other words, a case of out with the old and in with the new?
It’s more of evolutionary marketing rather than a divorce with the past. Think of it this way — it’s more information on steroids. You have just injected a thousand times more powerful level of information that one can crunch and analyse and learn from. Brand owners can then hit the right target at the right moment in time and on the right platform.
The old data is still being utilised to the fullest extent possible. Let’s take the typical brand tracker. Every marketer would measure its brand KPIs among a core audience on a monthly basis just to ensure that whatever marketing activity they do feeds into the power of the brand.
What’s happened is that brand trackers measure in an off-line mode after the activity has happened. But now there are new channels of communications that in real time can be adjusted as you go and churn data by itself. The old trackers are still valid; what we are doing is adding a couple of other streams of information that are actually enhancing the value of the brand tracker.
But if the new tools are available, won’t marketers be swayed by what’s new and ignore the old even if you say that both are valid?
If you specifically take the Middle East and North Africa region, the penetration level is not as advanced for the internet as in the US or the UK. The old practices in marketing and research are thus still valid.
What we are doing is adding a complementary layer of information that is measuring a constituency of the population which is internet savvy. One can say that connected segment is not a representation of the whole population and I would agree.
I am not deriving from that segment and generalizing for the whole population. All I am saying is that I will cover the wider mass of the population through the existing tools and add an additional layer of productivity that allows me to drill down on how exactly an input is translated into an output. That is made possible through technology and the internet and in the off-line space I cannot do that.
So how can marketers separate all of the data and analysis streaming in?
The recommendations can be taken at face value, I agree. That’s why you always need experts to help out, look at the whole constituencies and the full picture. Then you can zoom out and say what is good for the brand. In some instances, the existing tools are sufficient and that’s OK.
Would finding common cause with your clients be a long process?
The relationship has always been one of a dialogue. As an agency we sit on a lot of insights and data mining tools; our clients have their own data and we exchange those. The best outcome is to merge both data sets and come up with fitting recommendations for the brand. That’s better than saying I have research that’s good for all brands, all customers and at all times.
For the vast numbers of the uninitiated, what exactly are the new tools all about?
Uncover the “why” in a consumer’s behaviour. We always knew the “what”, even before or after a transaction. Behavioural science and sensory measurements have found their way into marketing literature. Steven Levitt’s Freakonomics and Malcolm Gladwell pioneered bringing behavioural economics into the marketing space.
It was a way to pin down the economic impact of certain emotional decisions taken by customers. Technology has made it easier to measure neurological processes.
Today if ask you a question, I wouldn’t know what percentage is rational and what is emotional. All we are doing is creating two new methods out of established branches of science — one is economics and the other is neuroscience. The “what” of consumer behaviour has always been explained through quantitative research; the “why” has never been.
When do you expect to be ready with a full rollout?
I don’t want to make a bold statement but we are experimenting with the tools and sometime over the next six months will provide the answers. The testing phase has been on for the past year.
Throughout the period, we have encountered some mismatches or imperfections in the system which could not explain why certain affinities were there for certain media channels or for certain brands. On a rational level it was never explained. Along the way we had to develop certain error margins and accept them.
Were the tools not there earlier?
The technology was present in certain cases but was too expensive. Now it’s more accessible. An employee demonstrates an iPad to customers during the opening of the company’s new store in Le Chesnay, near Paris. The availability of multiple platforms and means of media engagement for consumers has compounded the task for brand managers to determine consumer trends, leading them to innovate with new tools such as behavioural economics.
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