When I was a young professor stalking the corridors of American business schools there were certain courses you could rely on to be popular with MBA students: financial statement analysis, corporate strategy and international marketing. Yes, international marketing.
In the 70s, when the big US business schools started to expand, they realised that one of the biggest knowledge gaps for 30-something American managers was how to leave a Boston or Chicago head office and operate successfully in another country. International marketing became a huge course for MBA students for that reason, until a curious thing happened. A combination of globalisation, the internet, international business schools and the general emergence of the 21st century meant that international marketing became, well, marketing.
By the time we reached the year 2000 it was almost impossible to imagine any business that wasn’t global in reach and operation. Business schools started to include real global case studies across their syllabuses and the need for, and popularity of, an explicit course in international marketing dwindled to the point of obsolescence.
Diageo’s CEO Ivan Menezes got me thinking about all that again last year when he discussed his company’s rather impressive sales numbers. Diageo is one of the world’s more advanced marketing companies and so what Menezes said at the end of his analysis caught my attention. “It’s not about doing ‘digital marketing’; it’s about marketing effectively in a digital world”, he explained.
Bang! There it is. When we look back for the moment that the digital dodo was exposed I’ll bet a few experts will dredge up Menezes’ quote, blow off the dust, and cite it as a prescient moment in the death of digital. There are plenty of others making the same funereal comments, of course. Marc Pritchard, global brand officer at P&G, announced that the era of digital marketing ended in 2013 and has more recently gone on to point out that the “murky” world of digital media is in drastic need of a clean-up. Similarly, Nissan’s CMO Roel de Vries has long looked forward to the day when the word “digital” disappears. Ian Pearman, newly appointed President, Asia at TBWA\Worldwide, has been asking clients to drop the D-word for several years. Digital may not be dead yet, but they’ve started digging its grave.
Of course, it’s not a death, more a reincarnation. Digital has changed the world so much that it has become the world. While a few digital laggards continue to talk about the media world as ‘traditional’ versus ‘digital’, it’s becoming abundantly clear that this kind of arbitrary bifurcation is as unhelpful as it is inaccurate. Around a quarter of Australians now listen to radio using a digital source. Very soon half of all the profits made in this country from outdoor advertising will come from digital screens. Even good old news media is now deriving around a quarter of its subscriptions from digital editions. Should we start to include outdoor, radio and print as digital media? And the reverse is equally true. Most so-called digital brands aren’t averse to the traditional approach when it suits them. The digital duopoly of Facebook and Google spend more of their own ad budgets on traditional media than all but the biggest consumer goods brands. Amazon is busy opening bookstores in America – it doesn’t get more traditional than that.
And the bigger issue in the battle between digital and traditional is that we also managed to miss many of the other major touchpoints in this debate.
I spent 15 very frantic years working for some of the world’s largest luxury brands. They all knew, without a shadow of a doubt, that above print ads and digital communication, the age-old touchpoints of visual merchandising and service, were the pivotal media for attracting and retaining customers. Experience beats communication for most consumers, most of the time. Infamously digitally obsessed Gap CEO Art Peck told analysts, “I think windows today are much less relevant than they have historically been and you will see this going forward, that we are actually ‘skinnying down’ our window treatments”, and explained the shift away from windows, “If you haven’t won at the digital interface on the front end, your window in the mall store is probably not going to make a difference at the end of the day”. Gap is down 12% for the past year, the S&P 500 in America is up 23% for the same period.
And don’t even get me started on ‘digital strategy’. You can make a strong argument that tactically everything is becoming digital. You can make an even stronger argument that digital strategy is a contradiction in terms. To understand the point you have to grasp something that eludes many marketers, namely the difference between strategy (where I will play, how I will win) and tactics (the means and assets through which that win will be achieved). In marketing terms strategy usually comes down to three key questions: who is the target segment(s) I am chasing? What is the position I want to adopt with that target? What is my objective with the target? Answer these three questions and any brand is well on its way to having a decent marketing strategy.
But it should be clear that none of these questions are directly associated with digital issues. The targeting question is about people. The positioning question is about benefits. The objective question is about behaviour. It’s only once these strategic issues have been resolved that the digital issue comes into play in the tactics I might use, or not use, to deliver the strategy. Despite all the manifest changes that digital marketing has brought to marketing, the strategic game remains unchanged. Only the tactical players have changed.
Of course, you can bet that the hundreds of ‘digital strategists’ who sprang up over the past decade won’t go quietly. They will rage, rage against the dying of the digital light. Similarly, the world of marketing journalism, which has over-represented and over-protected digital marketing at the expense of the bigger strategic issues that CMOs are struggling with, will also need a reset.
Marketing has been changed, and changed utterly, by the digital deviation. At a tactical level our discipline is barely recognisable from the one that started the new century. But on the strategic plane, it’s very much business as usual. We have fabulous new marketing tools to play with thanks to digital, but the age-old questions of marketing – insight, creativity, positioning, engagement and, ultimately, effect – remain as annoyingly elusive as ever.