This is the second of a series of two posts on the new marketing mix framework proposed by Idris Mootee in his book “High Intensity Marketing”. In the first part, we looked at some of the big changes that have occurred while transitioning from the Industrial-Age into the Information-Age. We’ve seen how those changes are impacting marketing management and why we might need a new thinking framework.
In today’s information age, marketers need a new set of tools. A thinking framework they can use on top of the traditional marketing mix. Thus, giving them a new pair of glasses to interpret what’s happening in the market. The author call’s his new model, the « New 4Ps ». Nothing revolutionary so far, right! So what are those new elements? Here they are:
- – Participation
- – Personalization
- – Predictive Modelling
- – Peer 2 Peer
That’s it! Funny how all the marketing concepts start with a “P », isn’t it?. So let’s have a look at each element and dig a bit deeper.
Participation
This is where your customer becomes your partner by having an active role along the customer journey. A good example for this type of involvement can be found in product configuration tools. Dell is one of the first and best known example for this. Today, however, you can find product configurator when buying a MINI, a pair of Nike ID shoes, a tailor made shirt, a piece of furniture, or even for jewellery.
Participation not only happens at the end of the value chain though. Nowadays, customers help develop new products through crowdsourcing, they participate in store design, they even finance start-up through crowdfunding platforms like kickstarter.com. Technology has also enabled companies to gather customer feedback in much greater ways, thanks to online panels, communities, online focus groups. As Mootee says in the book: « participation allows companies to reverse-engineer the desire of their customers beyond what traditional research can do ».
Personalization
Customers are increasingly looking to differentiate themselves and buy products that meet their specific desires. With the acceleration of the digitization, individualisation has become not only easier and more affordable for companies, but also mandatory. Mass product personalization, as done with product configurators, allows customers to choose among a set of predefined feature to create a product that matches their personal taste. Customer knowledges base and algorithms have provided additional opportunities for merchants to tailor their offer, i.e. song and playlist suggestions on iTunes (Genius) or on-demand media consumption with Spotify, Time-Shifted TV and VOD (video on-demand). And with the emergence of 3D printers personalization will enter new dimensions.
Marketing messages, as well, can and must be personalized as an increasing number of customers are getting immune to advertising. Only by delivering relevant messages (read personalised messages) will companies get the permission to interrupt their customers.
Predictive Modeling
Being able to anticipate customers’ desire is the holly grail of marketing! Predictive modelling aims at helping you do exactly that. A blend of computational power, data mining, in-depth customer knowledge (CRM) and human intuition is the prerequisite in this world of statistical models and Big Data. We don’t need to fully understand how this works to grasp how powerful it can be in terms of marketing. Once companies start getting a deeper understanding of specific customer segments, they can start to deliver personalised offers based on a predicted customer behavior. This means that the customer will get exactly what he’s looking for (in theory – like all statical models predictive modeling has its flaws).
Amazon’s recommendation engine is a great example. Based on what the company knows about you, your purchase history and the behaviour of customer with similar track records, it can provide you with product suggestions. This dramatically increases the sales conversion. Predictive modeling can also be applied to dynamic pricing and special or time sensitive offers.
Peer 2 Peer
The emergence of new participation and collaboration tools (web 2.0) created a fundamental change on the internet. Information flow became multidirectional creating the network economy. Today, customers interact with each other, share their opinions, post comments and review products creating huge interest based virtual-word-of-mouth communities.
All this communication is happening outside the brand’s influence zone forcing them to give up control. Although this might sound frightening, this new reality, where the customer is in charge, brings great advantages if correctly leveraged. Online communities, social networks, blogs and forums can help understand customers, strengthen brand adoption, offer after sales support, spread messages, and many more.
These « New 4P’s » are a contemporary lens to look at marketing in the digital age. They emphasize on the new forces in place. Therefore, all marketers should add this framework to their toolbox. However, with the rapid changes occurring in technology and customer behavior, we can’t limit our analysis to this « New 4P’s » and we’ll be forced to add multiple lenses to our marketing analysis.
