In an ‘era-defining’ deal, Amazon founder Jeff Bezos bought the iconic Washington Post, after it had had six consecutive years of declining revenues. As much as this deal highlights Bezos’s vision, it also underscores a phenomenon of our times: Media and advertising companies are getting disrupted, changing forever.
The factors reshaping how brands and consumers connect—leading to this disruption—are also factors that, I believe, will alter the contours of the $100 billion Indian IT industry. For instance, this year, for the first time in history, the average US adult will spend more time online than on watching television. This shift in the media consumption pattern has driven corporations to increasingly move their advertising dollars to digital media, leading to the challenges that the Washington Post encountered.
Consider that in 2008, social media overtook porn as the number one activity on the web. As much as we use our social network to connect with friends and lead declarative lives, we increasingly draw on it to make purchase decisions. Today, a recommendation from a friend is seven times more effective at driving a product purchase than a newspaper advertisement. This has had profound implications on the role of consumers in shaping the brand story.
At the end of 2012, the number of connected devices on the planet surpassed the human population. This proliferation of mobile phones, tablets and interactive displays has changed how consumers access media. With the choice of multiple screens, the attention span of the consumer is now just a few seconds, with a growing tendency to scan and discard non-stimulating content. This has forced brands to rethink how to create immersive experiences that sustain consumer interest.
What is amazing about all this is not that technology has changed, but how much it has changed us. We have become more vocal, empowered and connected, seeking greater engagement with brands. The days of brands driving one-way communication by interrupting our favourite television programmes are getting over. As an ad executive recently said, traditional advertising is like going on a date and not letting the other person talk. Today customer engagement is the name of the game.
The cumulative impact of these changes has been massive for companies. Brands are struggling to cope with the shift from a small number of standardised communication mechanisms to several fractured and changing channels, devices and audience contexts, where a mistake can get shared with unprecedented speed and amplification. Expectedly, the organisation function undergoing the biggest change as a result is marketing.
Traditionally, marketing used to interact with consumers primarily through brand communication. Today, it has become imperative for the brand to deliver experiences consistent with its message. The risk of the consumer’s version of the brand story making its way across the world and destroying the ‘official’ narrative within minutes is too large to live with.
Marketing, therefore, has started taking responsibility for the consumer experience—a huge increase in scope, especially given the explosion in consumer touchpoints.
Most chief marketing officers (CMOs) have responded to this with a mix of strategies:
This represents both a challenge and an opportunity for the Indian IT industry. This year alone, our estimate puts the size of this opportunity at a staggering $400 billion.
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(This story appears in the 04 October, 2013 issue of Forbes India. To visit our Archives, click here.)
Good insight. Most of Indian IT workforce is focused on delivering to needs of customers outside the country because, frankly, there is not as much technology investment due to very low service or availability expectation from customers. We are missing the opportunities to exploit technology in addressing operational inefficiencies or creating more values. If we set on working these goals, I feel, automatically academic and industry will align with our expectations.on Sep 28, 2013
Excellent insight... I can see Every Business in Digital Business happening very soon....on Sep 28, 2013
Yes, Sanjeev. Business in Digital and Digital in Business are going to be two big waves which will merge at some time. Gartner\'s blog on \'Measure What Matters - But What Matters?\' nicely captures the business atmosphere though. http://blogs.gartner.com/martin-kihn/measure-what-matters-but-what-matters/on Sep 29, 2013
There are 3 angles to how companies are responding to this opportunity 1/ Acquire/partner agencies, build the digital ad/marketing platform for global execution/reach, analytics area - Accenture Interactive, Sapient Nitro, Cognizant Interactive ( again not all the companies are doing the entire offering here) 2/ Building Customer Experience Management (CXM) offering - this space is still evolving with the number of acquisitions by big enterprise software players, cloud leaders, as well as niche players. See my blog on CXM http://www.business2community.com/customer-experience/5-steps-to-success-on-the-customer-experience-management-journey-0478499 3/ SMAC/Big data practice - nascent stage. - Ramesh (Twitter @Ramesh_Ramki) My blog site www.futuristCMO.comon Sep 28, 2013
Good article. Yes. IT is is having major role in marketing. Dr.A.Jagadeesh Nellore(AP),Indiaon Sep 28, 2013