Marketing: A Waste Of Money Or The Most Important Business Function?

Marketing: A Waste Of Money Or The Most Important Business Function?
SHARE
THIS



In this guest post, Dr Peter Steidl (pictured below), principal at Neurothinking, takes a good, hard look at how technology will shape the future of marketing.

Dr Peter Steidl

The impact of new technologies will be more complex and disruptive to marketing than many of us realise. In case you are not yet worried about your future as a marketer, let me explore some of the major trends and developments that will create unprecedented risks and opportunities for marketers.

McKinsey, the Oxford Martin Institute and other credible parties predict that technologies that are already being deployed – artificial intelligence, blockchain, 3D printing, virtual and augmented reality, the Internet of Things, drones and robotics – will eliminate around 50 per cent of today’s jobs. Unfortunately, these technologies will not create many new jobs, leading to a massive disruption in the way we live.

As an example: technologists have proudly announced that autonomous vehicles will create some 120,000 new jobs in the US. What they didn’t mention was that close to eight million truck, delivery van, taxi and other professional drivers will lose their jobs. Add to this the expected job losses in the car insurance, auto repair, hospital and health services, car manufacturing and other related industry sectors, and we are looking at well over 10 million jobs lost compared to a gain of 120,000.

Of course, governments are not going to sit idly by while half the population lives on unemployment benefits. A number of countries are exploring the introduction of a universal basic wage as a means of dealing with the expected high levels of unemployment. But what does this mean for marketers?

As a marketer, you will find it easy to imagine how the prospect of a fixed, merely adequate income will impact on a consumer’s spending. Australia’s current household debt stands at just above 120 per cent of GDP. Of course, debt is no problem as long as income growth allows the consumer to catch up with their payments. Australia has had the longest uninterrupted period of growth of any country in the world, so consumers have got used to taking on debt based on the reasonable expectation that they will earn more in the future and thus be able to comfortably manage their indebtedness.

Now imagine how consumers will react when they know – with a high degree of certainty – that their future income will be safe, moderate and stay the same for the rest of their life. They will no longer be able to expect year-on-year income growth. What will these consumers do? What will happen to consumer spending?

And this is only the tip of the iceberg when it comes to technologies changing consumer behaviour. The use of digital home assistants is spreading rapidly in the US (e.g. Amazon’s Echo, Apple’s Siri, Google’s Assistant) and consumers are starting to delegate the ordering of many goods and services to them. Developments in new delivery systems – notably drones – are facilitating home delivery of many items, including groceries. Australia is not yet that advanced, but the US situation is a sign of things to come.

These developments, in turn, will have a profound impact on the retail scene. For example, when a significant share of groceries is ordered online and home-delivered, we are likely to see a reduction in mainstream retail outlets and a growth in emotionally engaging destination stores.

From a marketer’s perspective, there are a number of key challenges that must be addressed. Some of the most important questions that need to be answered are:

  • How will consumer behaviour change when close to half the population will be on a universal basic wage (or unemployment benefits if the Australian government screws up)?
  • How can we ensure that our offer is still seen as relevant and something the consumer doesn’t want to trade for convenience and lower prices by delegating the purchase to a digital home assistant?
  • How will we ensure our brand is the one chosen by a digital home assistant?
  • How can we adjust our offer and the positioning of our brand to be relevant and desirable in the new, emerging market environment?

If we can’t be the price leader (and the vast majority of brands can’t), then the only way to succeed in this environment is to build a strong emotional relationship with the consumer. This means that we need to develop a clear brand positioning because familiarity and buying habits will no longer drive purchases, and this which demands that we move increasingly from exposure to engagement.

Marketers can no longer afford to continue spending their time on short-term issues, with the quarterly budget consistently taking priority over the long-term health of the brand.

We are looking at an emerging environment where marketing will either be propelled to the most important business function or will start the quick slide to its demise, and this choice will depend on what marketers do between today and when the technological disruption hits and consumers change their behaviour in ways we have never experienced before.

A branch of marketing that is arguably in the best position to deal with these changes is sports marketing. More about this in my next contribution.

If you want to learn more from Dr Peter Steidl about the future of marketing, click here to secure your ticket to the Ministry of Sports Marketing conference next month.

Latest News

Ipsos Appoints Ex-Nielsen Exec As CEO Of South East Asia
  • Media

Ipsos Appoints Ex-Nielsen Exec As CEO Of South East Asia

Ipsos chairman and CEO Didier Truchot has appointed former Nielsen executive Suresh Ramalingam as CEO of South East Asia. Ramalingam’s remit includes Singapore, Malaysia, Thailand, Indonesia, Vietnam and the Philippines, with immediate effect. Ramalingam joins Ipsos from Nielsen, where he worked for more than two decades in various leadership roles covering the Middle East and Africa, South East […]

adblock popup web banner concept. isolated vector
  • Opinion

How To Reach The Unreachables

The unreachables may sound like the Indian caste system but, as you'll learn here, it's some newfangled marketing term.

Opinion

by B&T Magazine

B&T Magazine
Instagram Video: We Are Living In A Vertical World
  • Co-Lab

Instagram Video: We Are Living In A Vertical World

The way people record, share and replay their lives has changed dramatically since the advent of Facebook-owned Instagram. Once a place where only static, filtered photos could be uploaded, Instagram now offers photo and video uploads, shopping features, direct messaging and several other tools serving users and businesses. However, for Instagram head of business Jim Squires […]

by B&T Magazine

B&T Magazine
Yes! It’s Virtual Reality Demystified
  • Co-Lab

Yes! It’s Virtual Reality Demystified

Virtual Reality has been a staple of science fiction for some time, Though, in terms of real-life application, the world is still coming to grips with what the tool can offer us. In recent years, tech experts, doctors, medical students and videographers have used the tool as a way of exploring worlds not normally accessed in […]

by B&T Magazine

B&T Magazine
Facebook Messenger: The New Age Of Communications
  • Co-Lab

Facebook Messenger: The New Age Of Communications

The unparalleled success of Facebook-owned Messenger can be pinned down to its ear to the ground approach with users. Consistently listening to its user base of more than one billion, Messenger’s ability to stay not only on trend but well ahead of it has allowed the app to become a global tool for communication; be that […]

Industry Generates A Record $10.5m For Social Impact
  • Media

Industry Generates A Record $10.5m For Social Impact

UnLtd, the media, marketing and creative industry’s social purpose organisation has announced a total industry contribution of $10.5m to social impact in FY18. The total value of funds, services, inventory and time donated by the media, marketing and creative industry increased by 21per cent compared to the previous financial year due to a growth in […]

Women In Media Profile: Danni Wright
  • Media

Women In Media Profile: Danni Wright

We'd be headlining Danni Wright's Women in Media profile the "Wright stuff" if it wasn't utterly predictable and naff.

by B&T Magazine

B&T Magazine
Posterscope Promotes Two
  • Media

Posterscope Promotes Two

Posterscope, Dentsu Aegis Network’s specialist out-of-home agency, has promoted Ryan Hedditch to the newly created position of national head of strategy and Samantha Summers to Sydney Group Business Director. In his new role, Hedditch is charged with driving the continual improvement and transformation of the Posterscope offering to clients and partners. Summers’ promotion will see her lead […]

Outbrain Accelerates Growth With APAC Promotions
  • Media

Outbrain Accelerates Growth With APAC Promotions

Native discovery platformOutbrain has announced several movements in its regional leadership team, with plans to make more new hires. This comes on the heels of two senior appointments it made in February, after closing a record year in the region with expansion into new markets. Yoav Tourel has been promoted to head of sales for […]

Clems Syd & Extra GUM Unveil YouTube Digital Stage
  • Media

Clems Syd & Extra GUM Unveil YouTube Digital Stage

YouTube EXTRA Gum has launched EXTRA Support Acts, a program created to support Australia’s up and coming musicians by transforming pre-roll ads on YouTube into a digital support stage. It has been created in partnership with Clemenger BBDO Sydney as creative lead, Universal Music Australia and BRING for talent and music strategy and content, MediaCom and YouTube. The […]

OMD Australia Tops 2018 RECMA Rankings
  • Media

OMD Australia Tops 2018 RECMA Rankings

OMD Australia has taken the top spot for Australia’s Number 1 media agency in size, according to RECMA’s 2018 ‘Overall Activity Volume Rankings’ report released last week. Additionally, the company was named first in profile classification with a dominant profile for the 3rd consecutive year, along with vitality ranking and structure ranking. Furthermore, OMD Australia was also named […]

Red Agency Bolsters Sydney Team
  • Media

Red Agency Bolsters Sydney Team

Judging by the image, it seems Red Agency may have had no staff whatsoever prior to this hiring spree.

Nine Appoints Editor For 9Honey
  • Media

Nine Appoints Editor For 9Honey

B&T's editor coincidentally spilled honey on his shirt while typing this. And by typing, we mean copy and pasting.

Y&R Sydney Scores Best&Less   
  • Advertising
  • Media

Y&R Sydney Scores Best&Less  

Y&R wins Best&Less amid rumours the clothing shop its changing name to 'Somewhat OK&Reasonably cheap'.