Marketing 4.0: Moving from Traditional to Digital (Part 1)

Marketing 4.0: Moving from Traditional to Digital

Concept Synthesis and Local Application:

I am currently the Director for Finance and Accounting Operations at AIG Shared Services Philippines (ROHQ). I used to be an OFW in Libya for 3 years as a Chief Accountant for two large construction firms. Because of the civil war, I was repatriated back to the Philippines and joined AIG back in 2011. It has been 6 years now and my career with AIG and the role has expanded from being a Manager to now a Director for my organization composed of over 200+ people with 15 Managers managing a combination of Gen X, Y and mostly millennial generations of F&A staff. I can consider my digital journey as something experiential and felt like taking the Digital marketing course will really compliment my strong finance and accounting background. With the hope of applying whatever I learned from taking this course.

Part 1: Fundamental Trends Shaping Marketing

1 Power Shifts to the Connected Customer

1.      From Exclusive to Inclusive

Exclusive: Back during my first days in the BPO, we used to cater to only 1 process or accounting discipline, per manager.

Inclusive: Nowadays, managers are not constrained to cater to only his specialization in terms of process but spread across all other accounting processes or discipline for as long as the capacity of the manger permits.

2.      From Vertical to Horizontal

Vertical: Together with other functions’ managers, being the sole manager for my function back then I used to be the primary source of knowledge and being consulted on solutions to common problems with the process.

Horizontal: Nowadays, our Staff now has vast accounting resources on hand with google, YouTube, Investopedia and the likes.

3.      From Individual to Social

Individual: Performance evaluations used to be solely based on how the managers see the performance of their staff.

Social: Nowadays, performance feedback is not only 1-way. Upward feedback is also being done so as for the staff to give honest feedback to their supervisors and managers on how they are being supported with their careers.

More collaboration is encouraged to ensure that career development takes place. Although the ownership stays with the staff, managers now are required to keep track of the progress of their staff and provide substantial support for reaching the staff’s admiration and goals attainment.

a.       What are the trends in your industry that demonstrate the shifts toward a more horizontal, inclusive and social business landscape?

Insurance customers are now more powerful with easy access to other information via google and YouTube (horizontal), blogs and reviews, etc. With social media, time and geographic barriers no longer exist and customers from around the world can easily share their over-all customer experiences and feedback from one another (inclusive). For staff, the shift to a more competitive landscape brings about more choices for employment which fits their working styles, values, and aspirations when it comes to their careers. For Managers, the shift brings about challenges in managing especially millennials who tend to “grass-hop” from one job to another in search of their ideal job which can bring out the best in them.

b.      What are your plans to embrace these shifts in the marketplace?

Consequently, as the head and centrally managing the whole group, I have to continuously keep myself abreast with the trends and shifts in the marketplace. Management style also will need to keep in touch with the realities of today’s management issues especially those of the millennial generation. Just like digital marketing, flexibility and adaptability of style will have to be employed to adapt and be able to deal with the current and pressing issues that call for more adaptive and flexible leaders, including myself.

2 The Paradoxes of Marketing to Connected Customers

1.      Breaking the Myths of Connectivity

Connectivity must be viewed holistically through different levels. (a) mobile connectivity – being the most basic level, in which internet only serves as a communication infrastructure, (b) experiential connectivity – which focus not just on the width but on the depth of the connectivity, and lastly (c) social connectivity – which is about the strength of connection in communities of customers. In the BPO industry as a whole, being able to tap social connectivity is critical to winning the market share of the large communities of customers who are inter-connected and has tendency to influence each other’s buying behaviors and consumption and/or buying patterns. Most commonly, they would influence their circles – family, friends, relatives, workmates, and etcetera so in turn word-of-mouth marketing is still a strong force in terms of selling your products or services. This is of course apart from the vast resource of information available in the internet. Brands would then often bank on customer’s product/service advocacies, whether positive or negative.

2.      Summary: Marketing Amid Paradoxes

Several Paradoxes was presented, including (a) online vs. offline interaction, (b) informed vs. distracted customer and (c) positive vs. negative advocacies. In terms of online vs. offline interaction, both are meant to coexist and be complimentary, with the common aim of delivering superior customer experience. As for the informed vs. the distracted customer, and even as customers are empowered with abundant information, they’ve also become overly dependent on other’s opinions, which often outweigh personal preferences. In terms of the positive vs. negative advocacies, although attracting negative advocacies, this may not be bad at all as it can be converted/translated to a positive advocacies later on.

a.       What are some cases in your industry that capture the paradoxical nature of connected customers?

The same thing happens in the insurance industry and the Paradoxical nature of connected customers such as (a) online vs. offline interaction, (b) informed vs. distracted customer and (c) positive vs. negative advocacies. Oftentimes our customers will go online to search for products and services to answer their questions before even deciding to commit to a purchase. At the same time, offline interactions are happening simultaneously within their circle of influence for them to further complicate the decision-making process. Further, after having done their own research, they will always go back to other’s opinions which always or almost all of the time will be the basis of their decisions. Despite having negative advocacies, companies should see this as opportunity in transforming it into positive advocacies by addressing the negative attributes.

b.      How do you plan to embrace the paradoxes?

Paradoxes such as the ones mentioned should always remind us of the balance of things. Being a leader of a shared service location, I will always take into consideration not just the positive things that our customers are saying. But most importantly focus on the negative ones being raised by our them regarding the quality of our service – as a product, who are considered the “expert” since quality will always be subjective as to whether his/her specification of the kind of service or product is met or satisfied by the service or goods provider. It is not important whether the patient is wrong or right, what’s important is how the patient feels or the over-all experience.

3 The Influential Digital Subcultures

1.      Youth: Acquiring the Mindshare

Youth has always played the role of being the early adopters as they are not afraid of experimentation by trying new products and experiencing new services.  They are also the trendsetters as they are so agile in demanding everything in an instant and some of the biggest trends the world is following now are because of them. Further, by responding more quickly to changes in happening in the world like globalization and technological advancements, as primary drivers of change or game changers. These roles—early adopters, trend setters, and game changers—all lead to the conclusion that youth are the key to mind-share. If brands want to influence the minds of mainstream customers, convincing youth is the important first step. In the BPO industry for instance, majority of our staff are millennials or youth that actually plays a vital role in keeping the brand as influential as possible to mainstream customers.

2.      Women: Growing the Market Share

The influence of women at home and at work is growing. As information collectors, holistic shoppers, and household managers, women are the key to win market share in the digital economy. To access even bigger markets, brands will need to get past women's comprehensive decision-making. In the BPO industry for instance, there’s a strong influx and a steady trend of women being hired on important marketing posts who and will be able to relate to and capture the women at home and at work market segment. They are potential customers to tap and leverage on as key to growing the market share knowing the influence that they have both in home and in work in terms of the decision-making process.

3.      Netizens: Expanding  the Heart Share

Growing exponentially on the basis of emotional and mutually beneficial connections, communities of netizens are the key to expand a brand's heart share. When it comes to communal word of mouth, netizens are the best amplifiers. A brand message will flow along social connections if it receives the netizens' seal of approval. The seal of approval of the community of Netizens is synonymous to securing a very vital market share or position for any company and it applies to all and across industries, BPO included.

4.      Summary: Youth, Women and Netizens

Youth, women, and netizens have long been researched thoroughly by businesses but typically as separate customer segments. Their collective strength, especially as the most influential segments in the digital era, has not quite been explored. Youth are early adopters of new products and technologies. They are also trend setters, yet are fragmented as to the trends they follow. Ultimately they are game changers. As information collectors and holistic shoppers, women are de facto household managers, the chief financial officer, purchase manager, and asset manager all rolled into one. Finally, netizens are social connectors, as they overwhelmingly connect, converse, and communicate with their peers. They are also expressive evangelists as well as content contributors in the online world. Together, youth, women, and netizens hold the key to marketing in the digital economy. Placing our bets to (YWN) segment would pave the way for increased probability of getting advocates of our products/services, thus reaping rewards and huge benefit from tapping this particular segment of the market.

a.       How can your business acquire greater mind share by leveraging youth’s roles of early adopters and trendsetters.

Marketing to the youth segment needs careful planning and would always involve cool advertisements, trendy digital content, celebrity endorsements, or innovative brand activations. For my company AIG which offers insurance products that are targeted mainly to the older segments, the marketers need to involve the youth in crafting campaigns that will appeal not just to the older audience (who unfortunately has the money) but to the youth as well who can very well influence the majority in order for the company to acquire the greater mid share of the market.

b.      How can your business grow market share by leveraging the household influence of women?

Marketing to the women segment needs careful planning and would always involve exposing them to more factors of consideration for purchase, taking into account those that would appeal to them like both the functional and the emotional benefits of the product. Women being considerate on the totality of product’s overall value especially those that touch not just personal but family considerations as well. For my company, insurance products which appeals to the importance of securing the future of the family which in turn is something that should be prioritized and women are in the perfect position to appreciate the marketing efforts being highly emotional than men, in order for the company to grow its market share.

c.       How can your business identify and utilize netizens to win greater heart share?

Marketing to the netizens should appeal to both the emotional and mutually beneficial connections, community of netizens is key to winning greater heart share. As netizens are regarded as best amplifiers in terms of word-of-mouth marketing, my company should optimize the use of digital platforms to engage the netizens with the great portfolio of products that we have and the benefits it offers. For one thing the insurance will always secure the future of our customers. During the most difficult times of the lives of our customers, they have the assurance that we are there for them to assist them in their needs (in terms of claims) and that speedy processing of these will greatly alleviate the pain they’re experiencing for any form of loss. The experience will then create a positive brand message that will flow along the social connections of our customers-having the multiplier effect.

 

 

 

4 Marketing 4.0 in the Digital Economy (When Online Meets Offline, Style Meets Substance and Machine-to-Machine Meets Human-to-Human)

1.      Moving from Traditional to Digital

Traditional: Segmentation and Targeting, Brand Positioning and Differentiation, Selling the four P’s (product, price, place & promotion), Customer Service Processes

Digital: Customer Community Confirmation, Brand Clarification of Characters and Codes, Commercializing the four C’s (co-creation, currency, communal activation, and conversation), Collaborative Customer care.

2.      Integrating Traditional and Digital

Digital marketing is not meant to replace traditional marketing. Instead, the two should coexist with interchanging roles across the customer path. In the early stage of interaction between companies and customers, traditional marketing plays a major role in building awareness and interest. As the interaction progresses and customers demand closer relationships with companies, digital marketing rises in importance. The most important role of digital marketing is to drive action and advocacy. Since digital marketing is more accountable than traditional marketing, its focus is to drive results whereas traditional marketing's focus is on initiating customer interaction. The essence of Marketing 4.0 is to recognize the shifting roles of traditional and digital marketing in building customer engagement and advocacy.

3.      Summary: Redefining Marketing in the Digital Economy

Marketing 4.0 is a marketing approach that combines online and offline interaction between companies and customers, blends style with substance in building brands, and ultimately complements machine-to-machine connectivity with human-to-human touch to strengthen customer engagement. It helps marketers to transition into the digital economy, which has redefined the key concepts of marketing. Digital marketing and traditional marketing are meant to coexist in Marketing 4.0 with the ultimate goal of winning customer advocacy.

a.       How can your brand develop a powerful differential based on human-to-human touch in the digital world?

AIG Brand should always present itself as something that encourages strong customer engagement and participation. In light of so much customization, automation and the likes, it should maintain the human component of the product which appeals to the customer in the ever-changing digital world.

b.      How can your business transition from the traditional 4Ps to the digital 4Cs by adopting co-creation, taking advantage of currency-like pricing, engaging in communal activation and driving conversation.

Transitioning from traditional 4P’s to the digital 4C’s would entail a paradigm shift in terms of how the company sees the marketing mix. Traditional marketing mix will still be in place but will have to be complimented by accommodating and providing more avenues for customer participation, personalization, and increased transparency.

c.       What are the fundamental changes required in your customer-service strategy to embrace collaborative customer care?

Instead of serving customers, a company demonstrates its genuine concern for the customer by listening, responding, and consistently following through on terms dictated by both the company and the customer. In traditional customer-service, personnel are responsible for performing specific roles and processes according to strict guidelines and standard operating procedures. In a connected world, collaboration is the key to customer-care success. Collaboration happens when companies invite customers to participate in the process by using self-service facilities. In my company AIG, fundamental changes required to transition to a collaborative customer care is the mindset on how customers are treated. In general, the shift is on how customers are to be treated – should more of a business partner (collaborative) rather than a plain customer, being king of his purchase.