‘Beyond Advertising’: How Companies Can Build Better Customer Relationships by [email protected]

A Roadmap for Communicating with Consumers

How many times do you block advertising in an app or online? Yet, many companies persist in this marketing technique. In a new book, Wharton marketing professor Yoram (Jerry) Wind and The Wharton Future of Advertising Program executive director Catharine Findiesen Hays argue that the consumer is in control, and they want to interact with companies in new ways. Their book, Beyond Advertising: Creating Value Through All Customer Touchpoints, addresses ways companies can develop a more integrated relationship with those they serve.

Wind and Hays discussed their book on the [email protected] show on the [email protected] show on Wharton Business Radio on SiriusXM channel 111. (Listen to the podcast at the top of this page.) An edited transcript of the conversation follows.

[email protected]: How significantly has technology changed the playing field for companies, in terms of marketing, advertising and consumers?

Jerry Wind: The major change is what it has done to consumers because it empowers the consumers. Consumers now can get information on any brand they want to buy — the features, recommendations, pricing — in a moment if they have interest. They can be in a store looking at some product, and they can get on Amazon and try to find out better prices.

One of the major impacts of the technology has been the availability of technology, especially mobile, every minute of a person’s life. You can hardly separate now the person from his mobile phone, which changes dramatically the whole field of marketing.

In a sense, the consumer now has access to all the information. There’s no longer this information asymmetry, where the manufacturer, the marketer, had information, and the consumer was at their mercy, not knowing what’s there. The consumer now has more information than the marketer. The consumer is in control. The consumer is skeptical. Consumers don’t trust advertising. They are the reason we have technology leading to the possibility of ad blockers.

Consumers are sending a very clear message to advertisers: “We hate your advertising. We want to block it.” The advertisers, unfortunately, instead of listening to this and saying, “Okay, let’s change and follow some of the guidelines that are in the book,” they say, “Okay, let’s block the ad blocker,” which is the dumbest thing they can do.

“You can hardly separate now the person from his mobile phone, which changes dramatically the whole field of marketing.”

From the consumer point of view, the technology has changed everything. From the media’s point of view, look what’s happening in terms of digital advertising today. Digital advertising is really taking over to a large extent from the traditional one. But it’s one component. It has to be viewed as part of an integrated whole. So technology has been a major, major force of change, as an enabler for some of the changes we’ve been seeing.

[email protected]: As you just said, the consumers have more information than the marketers themselves. A lot of consumers realize the increased power that they have in this process now, more than ever before. That’s a big shift.

Catharine Hays: It has really changed the nature of the relationship, from one where you had no choice but to watch a certain number of channels and see a certain number of ads — that’s what it was. The power was truly in the hands of the marketer. But now, that’s shifted. The marketers who are really forward-thinking are actually excited about it. It’s a shift from feeling like they’re totally in control of what the conversation is around their brand to actually being part of a conversation — bringing consumers in, bringing people in — so that they are part of a cultural zeitgeist, in fact, and part of people’s lives.

[email protected]: Who are you trying to reach with the book? And what’s the main theme that you want to communicate?

Wind: I gave a presentation on our book to a group of 25 CMOs in the last Association of National Advertising meeting. Remember, the book is Beyond Advertising. “Beyond advertising” means primarily that you want to reach consumers not only through the traditional media but through all touchpoints. That’s really the key change.

After the presentation, one of the CMOs in the room said, “We’re the wrong audience for you.” I said, “How come? You’re the marketing heads.” He said, “No, this is really a call for CEOs.” Fundamentally, no CMO, or no one in the organization other than the head of a business unit or the CEO, has control over all touchpoints. In our view, one of the key messages of the book is that to try to reach consumers effectively, you have to reach them not only through the traditional advertising media, but also through the package design, product design, store design and call center interactions — any point of interaction a consumer has with the brand.

Unfortunately, corporations are organized by silos. So the marketing person has no control over the product, or even over the price, or even over the distribution….

The idea here is that’s part of the problem. That’s where you need the ability to reach all of them and bridge the silos. Back to your original question, our audience is really ideally CEOs, COOs, heads of business units. But it’s a must to marketing, must to advertising, must for some of the other units that basically have to interact, like the CTO, human resources, and others.

[email protected]: It also, in some respects, sounds like it just reinforces another theme: The fact that the role of the CEO has changed in the last decade. The CEO can no longer sit in the ivory tower and oversee everything. The CEO has to make visits to the mailroom and go down to marketing. That person, whoever he or she is, has to be multifaceted more so than ever before.

Hays: In fact, one of the chief marketing officers that we had on our Sirius “Marketing Matters” radio show recently was talking about exactly that phenomenon. She was brought in to do a rebranding exercise. It was in the financial services arena. Things have been changing so much that they realized how they communicated about their products and services to their customers had to really change dramatically.

“Keep in mind, every one of us is a consumer. In the book, we rarely use the term ‘consumer.’ We talk about people.”

But this was clearly not just an exercise for the marketing department. It literally was a reenergizing, a reexamination of the entire corporation. To your point, the CEO was on board from the very beginning, so that the whole corporation was going through this….

[email protected]: You note in the book is that not every company is ready to embrace everything that they need to over the next 10 to 15 years to be successful.

Wind: Absolutely. We suggest in the book what they should do about it and how they should transform themselves…. To be effective, what you have to do is align the objective of the brand, the consumers and society. Increasingly, the millennials are looking for companies that are doing [good]. They are trying to help solve society’s problems. The book, in a sense, is also for public policy decision-makers,

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