Marketing Roadmaps

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The Marketing Economy

Data privacy. A competitive advantage?

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I have always been interested in the intersection of public policy, business outcomes and consumer interest. While I didn’t set out to weave this interest into my career, I largely have worked at the leading (and sometimes bleeding) edge of the Internet, digital and social media, so it sort of worked out that way. Internet safety, personal privacy, email regulation, HIPAA, FTC endorsement guidelines, FDA advertising regulations, net neutrality.

And now data privacy. From GDPR and the California Privacy Law to the European e-privacy directive, I have been deeply interested in both the challenges and opportunities of data privacy. I wrote some posts on the topic last spring as the GDPR deadline approached in May 2018. Short version: as consumers care more and more about data privacy, innovation incorporating best practices for privacy could become a significant competitive advantage.

As the conversation swirled around the new rules and their impact, I then collaborated with my colleagues in the Marketing & Communications Research Center of The Conference Board, where I am a Senior Fellow, to field a research project to explore executive attitudes toward privacy, innovation and regulation as a indicator of how businesses might respond as stricter laws such as California and the e-privacy directive (which impacts use of cookies) take effect. We don’t have a crystal ball, and can’t truly assess the impact of future events, but we can gain a better understanding of how people think and how those opinions might impact their decision-making.

The research paper, authored by me, Innovate or Hunker Down: What Executives Think about Data Privacy, Security, and Regulation, was published last week and is available for free download from The Conference Board .

Topline

  • Organizations value data privacy and security, in no small part because consumers increasingly value them.
  • Compliance is part of company marketing messaging; however, few companies are deploying innovation around regulatory needs as a competitive advantage.
  • Attitudes shared in this survey offer evidence that corporate responses may shift to place higher value on innovation, but the driving force will most likely be consumer expectations, rather than a proactive response in anticipation of consumer demands.

We have some examples in the paper, but if you have case studies or anecdotes, either of companies that have successfully innovated in the face of regulation or that have eliminated products or services in the face of compliance challenges, please drop me a note at sgetgood@getgood.com.

Two Truths and a Lie: trust, #ad and privacy

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Gregarious Narain is on vacation until the end of the month. We’ve got a couple guests lined up to join me in his absence, but this week was a little hectic so (truth) I did not have time to prep them properly, so this week it was just me, and a slightly shorter show.

Would you like to join us on the show? It’s pretty easy. We broadcast live on Fridays at noon eastern for about 20 minutes. I send you a link to connect to the broadcast platform in the morning along with any show notes we’ve prepared and you log in by 11:50 am for an AV check. Sometimes you’ll be joining Greg and me, other times it is just me.

What will we talk about? We are open to discussing any topic related to marketing writ rather large — digital and social media, advertising, influencer marketing, technology , but also Internet culture, consumer behavior, digital fraud, privacy, artificial intelligence. If YOU have a topic you’d like to bring to the table within that rather large brief, we’d love to build a conversation around it with you. Email me at sgetgood@getgood.com or message me on Facebook.

Now to this week’s topic — consumer attitudes and trust. Joining me are my two guests this week, Mr. Rogers and Captain Rogers, two icons of honest integrity.

I only have 2 topics this week, because both are both truth and lie. The first is that consumers don’t like or engage with sponsored content the same way that they do so-called organic content. I wanted to discuss this (again) this week after reading a great op ed in Ad Age, In Defense of the Lowly Hashtags #ad and #sponsored by Natalie Zfat. Written in response to the statement “nobody likes the hashtag #ad” at an industry panel (filled with marketers), she shared her pride in using #ad because it meant she was able to successfully monetize her content while creating valuable content for readers.

This strikes a chord with me because I think treating sponsored content as a second class citizen is lazy thinking. Fact: transparency and best practice would dictate that we disclose relationships that might impact an endorsement even if the FTC Guidelines did not. But also Fact: the FTC guidelines in the US and similar guidelines in other countries DO dictate that we disclose when the content we create is sponsored or influenced by payment, business relationship or free product. And finally FACT: people are not as black and white in their consumption of content as the conceit organic:good, sponsored:less good makes it seem. I have seen more than a little organic content that is AWFUL and quite a lot of amazing sponsored content.

It is not that we don’t like advertising. It’s that we don’t like bad advertising. Whether an ad or a sponsored Instagram image. It is incumbent upon us as content creators to create quality content, full stop. When it is sponsored, we disclose, because it is the right thing to do. Cap agrees!

On social media, there is no situation where you do not have to disclose that the content is sponsored. Not even for celebrities. The reason for this is that on social, we have none of the cues that inform us that the endorsement is an advertisement that we have in other media. When we see a celebrity on Ellen, we know she is pitching her new movie because that is inherent in the talk show format. When we see an athlete in logo gear, we assume that he or she is sponsored by the brand, because that is how sponsorship works at that level. When we see the same celebrity promote something on Twitter or Instagram, her post looks just like all her other posts, and just like all the other posts of all the other people using the platform. There are no cues to clue us in that this post is sponsored. When an advertisement doesn’t look like an advertisement, it must be disclosed. Just this week I ran across another article about celebrities failing to disclose, this time in the UK. This is one time where wishing won’t make it so. Wishing you didn’t have to disclose or inventing all sorts of reasons why it doesn’t apply to you won’t change the facts. Because it is all about trust. Right, Mr. Rogers?

So, while it is true that people do treat sponsored content differently, the difference, in my opinion, is largely in the minds of the creators. If we stop assuming that people view sponsored content differently, create amazing quality content and honor the trust of our readers by being honest about our business relationships, we can be proud of #ad.

This week’s other part truth part myth is also related to trust. In this case, our trust in the social platforms and websites. Axios Media Trends reported this week on Census Bureau Data that indicates Americans are less worried about online privacy, largely, the report surmised because we have become accustomed to trading it for access and services.

Photo: Protest Stencil
Photo: Protest Stencil

But we are still concerned about data privacy, security and integrity. Witness the Twitter storm caused by the fake billboards in London last week.

They struck a chord because there is an underlying cognitive dissonance between the value consumers perceive they get from Facebook and the value they are increasingly aware Facebook gets from them. GenZ is already replacing it, including on college campuses, with new “facebooks” coming online, also reported in Media Trends this week.

I have been following the digital privacy conversation for more than 20 years, sometimes closely, sometimes less so but I am convinced we are finally at the inflection point where it matters as much to consumers as it does to advocates and geeks, and it is an increasingly informed consumer who understands that there are 3 issues: privacy security and integrity. Being willing to give up a little personal data in exchange for access is a fair trade but we are no less concerned about the protection of that data.

So. The truth is Americans may be less worried about privacy in general, but it is because they have become more informed. And we are very likely still very worried about how our information is used, whether information is true and whether bad actors can breach the walls. We just are more willing to accept the risk.

So you want to be an influencer?

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Last winter, I recorded two video workshops about best practices in influencer marketing for genconnectU, a course for Brands, Tapping into Social Trust, which was released in late May, and for influencers, Charting Your Path, which is available now.

A reality about making a course that includes tech is that anything too specific about platforms or tools will always be overtaken by changes in the marketplace. For example, when we recorded the courses, Klout was still in business and Google called its advertising products AdWords and AdSense.

This is why I focus on strategy, process and tactics rather than specific tools in my courses. Even though things have changed in the marketplace, the best practices have not.

In addition to the video lessons, there are additional materials in both courses, including a Scope of Work outline in the course for brands, and Guidance for Setting Rates in the course for influencers.

If you use the code Susan10, you can save 10% off the list prices of $119 for the Brand course and $29 for the new Influencer course.

From BOTS to BOUGHT: The “crisis” in influencer marketing

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Today, Digiday published the confessions of a former influencer describing widespread fraud in the influencer marketing space, focusing largely on bought followers on Instagram, where influencers regularly amassed followers literally overnight in order to compete for coveted fashion and beauty deals. All to meet the demand of advertisers and their agencies for scale. Reach was the de facto result. This is absolutely 100% true, I have no doubt.

It’s also not influencer marketing. We have to be REALLY careful to not throw the baby out with this admittedly nasty AF bath water.

As I wrote last week, this fraud — and it is fraud — stems from the ad industry’s relentless pursuit of scale without a similar commitment to authenticity and performance metrics.

Influencer marketing works because it is human-centered, and humans beings don’t scale neatly with algorithmic and predictable precision.

In the 90s, anthropologist Robin Dunbar theorized that humans can only sustain a limited number of stable social relationships; 150 is commonly cited as the upper limit. While modern communication has changed how this dynamic works, as we are able to move more fluidly from group to group, online and off, and may participate in multiple networks of people with whom we share common interests, we should always keep Dunbar’s number in mind when thinking about how influence works. The ripple effect of a recommendation matters just as much as the initial impact. Much harder to measure of course, but just because something is hard doesn’t mean we should not strive to do it.

Influencer marketing done right is building relationships with customers over time, who serve as the advocates for your brand to their friends, fans and followers. You know and trust them. Their audience knows and trusts them. You work together to achieve a common goal. Kumbaya and all.

Influencer marketing works because we do move in and out of different groups online, and when we share a recommendation from one into another, we form a ripple on the pond. What’s been missing is way to independently assess the audience of influencers to verify that they do have the right audience. Independent of and across the platforms, independent of the agencies. It’s challenging, and even more so if you respect individual privacy rights. I’m working on some things in this space. More to come.

In the meantime, the best approach is to understand that the best results from influencer marketing don’t come from scale. They come from trusted relationships over time.

The other issue exposed in the Digiday Confession is poor measurement practices.

Reach is a delivery metric. It tells us whether we executed our social tactic successfully. It is not a performance metric. Performance is engagement with content, and your objectives dictate whether you are working toward likes, shares and comments, or driving all the way down the funnel to conversion. Reach is not a result.

The Digiday piece also shared that boosting posts, at least in this confessor’s situation, was just as fraudulent, reaching folks not even remotely in the audience target purely to shore up the numbers. This is just straight up bad practice. Boosting posts simply to increase the reach is a waste of money. You should ONLY boost your best-performing content, the content that is getting verified engagement, to expose it to a larger or different audience. Do not boost your turkeys. Let them fade away.

What about the BOTS?
The other article that caught my attention this morning was a piece on CNN about Lil Miquela, an influential CGI (computer generated image) that amassed quite a following before it was revealed that she was a CGI.

My opinion? If CGIs advocate for brands and someone is compensated for the endorsement, it is advertising, straight up, and should be disclosed. Ethically, I think it should be disclosed even if they are not doing brand or cause related work, because they are a construct, and consumers should know.

Personally, I’m not sure I love the idea of people modeling themselves after, being influenced by, robots, but as long as it is fully disclosed as CGI advertising, I don’t see why brands shouldn’t have the option to use CGI tools to deliver their message. They can dictate the message and don’t have to worry about the opinion of the CGI. Likewise if they use BOT accounts to manage message flow or respond for the brand in place of human CSRs. It’s okay as long as you tell people they are engaging with a BOT.

But CGIs and BOTs are not influencer marketing. They are simply innovations in advertising.

On Cannes and the marketer backlash against influencers

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The early news out of Cannes, where the glitterati of the advertising world have gathered to rub shoulders, quaff rosé, do deals (or at least talk about doing deals) and generally celebrate their own creativity and business acumen in the hopes of snagging business from the legion of CMOs taking advantage of what has to be the best boondoggle on the planet, is that a marketer backlash against influencers is growing. At least according to Digiday’s piece on June 20th.

The basis for the argument is the announcement by Unilever CMO Keith Weed on Monday that the company is pushing for greater transparency in influencer marketing to combat fraud, create better consumer experiences and improve measurement.

In a prepared statement, Weed committed the company to not working with influencers who buy followers, to never buy followers itself and to prioritize partners committed to increased transparency and eradicating bad practices. He dramatically concluded with:

The key to improving the situation is three-fold: cleaning up the influencer ecosystem by removing misleading engagement; making brands and influencers more aware of the use of dishonest practices; and improving transparency from social platforms to help brands measure impact. We need to take urgent action now to rebuild trust before it’s gone forever.”

This is noble, and I commend Unilever for taking a position.

HOWEVER,

I take exception to the idea that we can have backlash against our customers. Influencers, true influencers, are our customers. People who love our products and want to share their opinions with their friends, family and fans.

So let’s reframe this accusation before we go too far.

What we are reacting to is fraud, perpetrated largely by automated systems in the search for scale. Yes, people bought followers to make their numbers look better. But the root cause — and this is true for many digital fraud issues —is the holy grail of scale over all else. Reach as many people as you can at the least possible cost. The volume ensures a certain percentage of buyers. Except at some point, the volume becomes the goal, not just the means to the goal.

We’ve been seduced by delivery metrics, taking shortcuts that promise to deliver more, for less. It’s a cycle of inflation that “looks good” but doesn’t actually deliver to our objective.

Why are we always so surprised when the shortcut turns out to be a dead end?

The problem isn’t influencers, who are, after all, your customers. It’s the never ending search for scale without a similar commitment to authenticity and performance metrics.

I suggest (and have for years) that we think about consumer to consumer marketing differently.

Relationships
Ground your influencer marketing strategy in authentic relationships with customers who want to advocate for your brand. Don’t neglect those with smaller follower numbers; sometimes they are your most effective evangelists.

A good influencer marketing strategy activates customers with all degrees of influence, using tactics that take best advantage of both the customer’s passion and her platform.

Performance metrics
The performance that matters is conversions. Everything else is a delivery metric. Even engagement. Although it can be a conversion metric for some objectives, for the most part, it too is simply a way to measure the delivery of a program.

Make sure your program has a conversion metric, and a way to get there. You can’t convert without a call to action.

Link back to sales. You can be super sophisticated using modern marketing platforms. Or you know, simply start tracking sales over time against marketing activity, including influencer.

How de we avoid fraud in influencer marketing?

  • Stop chasing scale and start working with your friends.
  • Measure what matters, not everything that moves.

Cheers!

GDPR 101: Focus on your Customer

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GDPR, the EU’s Global Data Privacy Regulation, took effect at midnight Brussels time today.

In its Winners & Losers article, which I encourage you to read in full, Digiday comments  “Bluntly speaking, any business that doesn’t have a direct relationship with users is in for a difficult time,” and goes on to note subscription-focused publishers as one of the GDPR “winners.”

My 2 cents: Moving forward, every publisher, every brand needs to think like a subscription-focused business.

The game is no longer JUST about acquisition or impressions at scale. Audience targeting is about to undergo a major sea change as available inventory shrinks and costs to produce it increase.

Customer loyalty and customer permission are the long-term keys to success in a post-GDPR world. To get and keep them, we need to deliver a stellar experience for customers. This means:

  • building a well-loved, well-known brand;
  • creating excellent, well-organized content ecosystems that incorporate all the touchpoints consumers have with our brands;
  • delivering a quality personalized environment for customers/readers/viewers;
  • leveraging customers’ passion for the brand or content by engaging them in the content. Influencer marketing for sure, but also community forums, face-to-face events, private chats.

Remember: consumers like it when content and experiences are tailored to them. Even ads. But they need to be truly tailored to their preferences. No one likes to be stalked by shoe ads just because they looked at the shoes once and their income level matches the advertiser target.

A final note: GDPR is often compared to Y2K in terms of the scope of effort required to comply, and on some levels, this is true. However, Y2K did have an end point. Either your systems fell apart on January 1, 2000 or shortly thereafter, or they didn’t. GDPR on the other hand is far from over. This is just the beginning of a new media environment.

Fasten your seatbelts.

Digital media predictions for a post-GDPR world

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Last week, a business acquaintance made a ballsy prediction on LinkedIn for which he took a fair amount of flak. Posting a comment, I noted that his essential point was not that much of a stretch. Of course, there were nuances to the argument, but a long statement with a bunch of caveats wouldn’t be nearly as interesting or thought-provoking. Predictions have to push at the edges or people won’t pay attention. So, I figured it was time to step onto the ledge and make some predictions about the future of digital advertising. I’d love to hear what you think, agree or disagree.

1. In a post-GDPR world, targeted advertising is going to become more expensive. Not immediately. There is still a lot of confusion (some real, some manufactured) about what is required.  In the end, though, the increased costs of delivering compliant targeted audiences combined with a decrease in available inventory as consumers retract or refuse permission, will increase ad rates to premium, not programmatic, rates. I’ve been arguing this for a while and the pundits are finally admitting it. 

2. Context will be queen again. In order to reach the right audience, we will turn to content-centric, community-centric marketing tactics. In part because they ARE more effective in converting customers, but mostly because the cost differential between them and targeted/programmatic advertising won’t be so great. It will be just that much easier to take the leap of faith to try these tactics, which are still working out their success metrics (more about that in a bit.)

This is the opportunity for niche publishers and brands to create content for their micro-audiences that both provides the necessary context for ads and sponsored content and creates a relationship and value exchange in which the consumer is more likely to give permission for the specific use of personal data. As an example, Pepper & Wits, a new content site for women 45+ who are navigating menopause is owned by P&G; we certainly should expect sponsored content and other brand outreach but the primary purpose is to offer value to the consumer and targeted context, not targeted ads.

3. “If you aren’t paying, you’re the product” is a cliché whose days are numbered. Consumers will start to care about privacy. It has been a LONG time coming, but I truly believe that consumers are finally understanding the true cost of free digital services/platforms, and are going to want real value in exchange for the right to use their personal data. “Legitimate business interest” is not going to be sufficient to use a person’s data without permission. Publishers and brands who are offering great content and building relationships with consumers will have a far better chance of obtaining (and retaining) permission.

4. Things are about to get more competitive. Facebook and Google are vulnerable in this new advertising economy. They aren’t in danger by any means, but their models are based on scale, not relationships. They have no friends, just users. This opens up a sliver of opportunity for niche content publishers to create better experiences for consumers and pick off a little wedge of the pie. The duopoly will still get (more than) its fair share, but they will be handicapped in delivering their biggest strength, targeted audiences at scale, so the little guys can dart in and nab their share in areas where Facebook and Google cannot play effectively, content and community. Niche publishers, bloggers, even brands who can make the long haul investment. And Amazon. Amazon already does a better job of community than either Facebook or Google, is nipping at their heels and has a distinct e-commerce advantage. I also predict Reddit will make a strong play for the “community ad dollar.”

5. All of this will drive innovation. Certainly, in ad tech to manage consent, but that’s just the tip of the iceberg. Folks are already working on challenges like better measurement and attribution models that assign value properly and proportionally to all the players in the value chain, not just the last click. This is crucial for branded content, video, social media and influencer marketing.

Community is also getting some attention. Two start-ups doing interesting things to connect brands with consumers: Social Data Collective and Suzy. Suzy (AskSuzy.com) is the evolution of social media and influencer business Crowdtap. It helps advertisers make and manage meaningful connections with customers by offering them access to its super panel of consumers. Social Data Collective has a slightly different approach; it asks consumers to share personal data with the brands they love in exchange for products/services.

But I think even more interesting things are on the horizon. For example, aggregators of consumer information that validate consumer audiences and can compare them across properties, including blogs and YouTube and all the other places that community will form, not just sites big enough to register on comScore. Audience data all the way down the long tail to validate that the context IS delivering the right audience. This “data hole” has been the bête noire of the influencer marketing business, but there wasn’t a strong enough incentive to solve it, when advertisers could just buy targeted audiences cheaply. To sell content and community as the right context, you need the metrics to prove that you’ve got the goods. It’s coming. I am certain. And it won’t need PII (personally identifiable information) to do it.

We also need tools to give consumers control over their privacy across platforms and processors. Right now, if you think someone has compromised your private data or is using it without permission, good luck tracking it down. Blockchain is the best bet for creating this privacy audit trail. Someone is certainly working on this already. In fact, if you know who, I’d love to chat with them!!!

So there you have it. My predictions for the digital media industry. If you need me, I’ll just be out here teetering on the ledge.

P.S. If you want to check out the prediction of my business acquaintance, you can find it on LinkedIn.

Customer-Centric Marketing. An idea whose time has FINALLY come?

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Activating the passion that consumers have for the brands they love and turning them into your advocates is the secret sauce to identifying and converting new customers as well as increasing the loyalty of retained customers.

This simple concept, customer-centric marketing, has been the basis of my work for more than 20 years. It’s why I embraced blogs and then social media so wholeheartedly. It’s why I advocate so strongly for transparency, authenticity and disclosure, because they foster trust, the currency of social interaction. Online and off. It’s why I have embraced GDPR and other privacy initiatives for the promise they offer to build strong relationships with customers based on a balanced, informed value exchange for personal data.

Customer-centric marketing is also an idea that is often given lip-service, but not nearly as often embedded in our corporate DNA. We talk a good game about building relationships with customers, incorporating consumer feedback, building products and services that delight them. But when it comes time to implement the marketing plan, we use the language of war. We target audiences. We deploy tactics. We execute plans. We profile the customers into personas who are expected to follow prescribed patterns of behavior.

Which is fine, to a point. It would be foolish not to aim your marketing efforts at the audience most likely to buy. But our language and our tactics both tend to dehumanize our customer, to the point that we forget they are people and not just impressions or clicks or conversions or profiles. Taken to the extreme, and make no mistake modern digital marketing exists on the very edge of this extreme, our marketing isn’t just automated, it’s robotic, and not in a good way.

More human tactics like social marketing, influencer engagement, event marketing and even branded content restore the balance and remind us that customers aren’t simply segmented groups of purchasing behaviors, they are people. Living, breathing people who love our products and services, and are simply waiting to be asked. While these tactics are very often more effective, they are nearly always more expensive than digital advertising which uses programmatic buying and consumer targeting to reach the right audiences cheaply, at scale.

The good news, for advocates of more human centered approaches (like me), is that GDPR promises to reduce that financial gap. The SUPPLY for targeted ads will be diminished when (inevitably) publishers can’t document permission or consumers withdraw permission. It also will be more expensive to deliver an audience targeted PROPERLY with personal data. Both scenarios will increase CPMs for the remaining inventory. More on these and other scenarios in Marketing Week.

Certainly, contextual targeting will pick up the slack for digital advertising. There also will still be a market for premium permission-targeted audiences. Niche publishers in particular have tremendous incentive to develop a strong value proposition, both for their content and in exchange for the use of personal data for targeting. I wrote about this last fall.

As the cost gap closes between digital advertising at scale and more engaging tactics like influencer marketing and branded content, marketers will have incentive to shift budget to customer-centric marketing, where relevance can be proven by our interest and engagement with content and brands, not simply implied by our browsing history or past purchasing behavior.

It’s then up to us as marketers to create the compelling, customer-centric campaigns that engage consumers and convert prospects to buyers.

I’m game!

—

Additional Reading on GDPR. Tick Tock. Less than 3 weeks to go. 

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