This is an important, perhaps seminal book. It was inspired by a multi-million research program I initiated in 2005 called Marketing 2.0. Sean Moffitt and Mike Dover were two of our outstanding thought leaders and produced some profound new thinking about the brand. I encouraged them to write a book to develop their findings, and the result was a profound and stimulating work with far-reaching implications for anyone who cares about marketing.
For fifteen years, my colleagues and I have argued that it was only a matter of time before the Web revolutionized marketing. Today, as new communications media become ever-more pervasive, conventional wisdom about advertising, promotion, publicity, public relations, and the brand itself is finally being shattered. Traditional ideas are rooted in the assumption that unidirectional, one-size-fits-all, print and broadcast media would always be used to communicate messages to faceless, powerless, inert customers.
Historically, the brand has been seen as a promise, an image, a badge, or (as many popular books described it) “a word in the mind.” It was not viewed as something that exists in the minds and actions of customers, but an asset to be owned and controlled by companies. Brands were established primarily through mass communications, by inundating consumers with the same image and message over and over through various media.
Today, the brand is becoming a more complex construct. In fact, the brand has an architecture of sorts that includes various critical elements requiring constant attention and strategy. The foundation of this brand architecture is a firm’s integrity—honesty, reliability, consideration, and candor. Integrity is important because of the growing demand for transparency. Consumers can evaluate the value of products and services like never before. Employees share formerly secret information about corporate strategy, management, and challenges. To collaborate effectively, companies and their business partners have no choice but to share intimate knowledge with one another. Finally, in a world of instant communications, Wikileakers, inquisitive media, and Googling citizens, people everywhere can routinely put firms under the microscope.
Companies are being stripped naked, and corporate fitness is no longer optional. The precondition for customer trust in a brand is integrity. If the financial meltdown of the past few years tells us anything, it’s that firms need to be buff, providing good value and exhibiting integrity as part of their corporate DNA.
Perhaps more important, because of the new social Web, the brand has evolved from being an image to becoming a relationship. This transformation is driven by a lot more than social networking. Sure, the half-billion people on Facebook love to talk about products, services, and companies, as do the 150 million or so on Twitter. But countless other communities and vehicles are turning the old brand on its head, providing an opportunity for companies to build deep relationships with consumers.
Consider this factoid. Between the beginning of recorded history and the year 2003, there were five exobytes (equal to one quintillion bytes) of information recorded. To put this in perspective, there were five exobytes of information generated and recorded over the last two days—most of it by the public. In fact most information and content today are being generated by individuals and consumers, not by companies.
When you add in the norms of the most important emerging marketplace—a new generation that has “grown up digital”—you’ve got a formula for radical change in marketing. Given the propensity of these young people to ignore advertisements in traditional media, their growing ability to scrutinize companies, and their surging power in the marketplace, they are driving the change in thinking discussed in this book. A new form of marketing is emerging in which brand managers emphasize customer engagement, brand collaboration, and in some cases, even shared brand ownership.
Smart companies are eschewing less effective, command and control marketing and communication methods. As the Net Generation comes of age, hundreds of millions of passionate users and consumers are taking an active role in determining, shaping, and redefining brands independent of company involvement. Winning companies and brands are learning to engage and co-create with these customers rather than shouting over or ignoring the noise of the marketplace. To bridge the marketing divide, the concept of controlling the brand is now giving way to collaborating with a stakeholder group with whom most companies are unfamiliar: their customers.
The advertising industry has been slow to understand and adapt to these changes. The industry began early in the twentieth century in the United States, when regional newspapers seeking advertisements found an agent to link them up with suppliers who wanted to reach the paper’s audience. Nascent agencies solicited ads from manufacturers and other companies and offered to create the advertisements for the papers in exchange for a 15 percent commission of advertising revenues. The agencies provided the link between the producer and the newspaper. Today, the 15 percent rule has pretty much collapsed, and agencies have had to re-invent themselves and their function re-intermediate to create new value. But their instincts are still to use traditional media and traditional thinking about the brand, to “promote” their clients’ products rather than engaging consumers in building much more appropriate and powerful relationships.
In fact, it makes sense for companies to view their customers as part of their businesses rather than as external entities. Customers want to be engaged. They have power through access to near-perfect information about products and corporate behavior. They interact through multidirectional, one-to-one, and highly tailored communications media. They, not companies, control the marketing mix. They choose the medium and the message. Rather than receiving broadcast images, they do the casting.
So just as Wikipedia views its contributors as part of its network, companies can use the thinking of wikibrands to bring their customers into the fold. Rather than “focusing” on customers as conventional wisdom proclaims, marketers can engage them. Co-innovation and new value exchanges can replace old-style “customer centricity” and market segmentation. And customers, rather than being passive recipients of goods, services, and messages can participate actively and directly with corporations.
The result of all this is that you can create better value and better customer loyalty through participation and engagement. Remember (not so long ago) all the predictions that the Web pioneers such as Amazon, eBay, Google, and more recently, Facebook were doomed to disaster because their competition was only a click away? What the doomsayers didn’t understand was the power of relationships. When firms use the Web to truly engage customers, the relationships can be strong and lasting. I’m tempted to describe this as a new form of wealth, such as “relationship capital,” that firms need to develop and manage like other forms of capital.
If you read and act on this book, you’ll retire the old Four Ps of marketing (product, place, price, and promotion). You’ll chuck out old concepts of the brand as an image that you own and control. And you’ll set a course to engage your customers and benefit from a new paradigm in marketing appropriate for the digital age.
Enjoy and prosper!
Don Tapscott is the coauthor of sixteen books about technology in business and society, most recently Blockchain Revolution: How the Technology Underlying Bitcoin is Changing Business, Money and the World and previously, Grown Up Digital: How the Net Generation is Changing Your World discussing how the Net Generation is revolutionizing marketing. He has also authored Wikinomics/Macrowikinomics on the powers of collaboration that were best-selling management books globally Don is CEO of The Tapscott Group and co-founded the Blockchain Research Institute.