Category Archives: Market Research

Dove’s Takedown Of AI: Brilliant But Troubling Brand Marketing

The Dove brand has just placed a substantial stake in the battleground over the use of AI in media. In a campaign called “Keep Beauty Real”, the brand released a 2-minute video showing how AI can create an unattainable and highly biased (read “white”) view of what beauty is.

If we’re talking branding strategy, this campaign in a master class. It’s totally on-brand with Dove, who introduced its “Campaign for Real Beauty” 18 years ago. Since then, the company has consistently fought digital manipulation of advertising images, promoted positive body image and reminded us that beauty can come in all shapes, sizes and colors. The video itself is brilliant. You really should take a couple minutes to see it if you haven’t already.

But what I found just as interesting is that Dove chose to use AI as a brand differentiator. The video starts with by telling us, “By 2025, artificial intelligence is predicted to generate 90% of online content” It wraps up with a promise: “Dove will never use AI to create or distort women’s images.”

This makes complete sense for Dove. It aligns perfectly with its brand. But it can only work because AI now has what psychologists call emotional valency. And that has a number of interesting implications for our future relationship with AI.

“Hot Button” Branding

Emotional valency is just a fancy way of saying that a thing means something to someone. The valence can be positive or negative. The term valence comes from the German word valenz, which means to bind. So, if something has valency, it’s carrying emotional baggage, either good or bad.

This is important because emotions allow us to — in the words of Nobel laureate Daniel Kahneman — “think fast.” We make decisions without really thinking about them at all. It is the opposite of rational and objective thinking, or what Kahneman calls “thinking slow.”

Brands are all about emotional valency. The whole point of branding is to create a positive valence attached to a brand. Marketers don’t want consumers to think. They just want them to feel something positive when they hear or see the brand.

So for Dove to pick AI as an emotional hot button to attach to its brand, it must believe that the negative valence of AI will add to the positive valence of the Dove brand. That’s how branding mathematics sometimes work: a negative added to a positive may not equal zero, but may equal 2 — or more. Dove is gambling that with its target audience, the math will work as intended.

I have nothing against Dove, as I think the points it raises about AI are valid — but here’s the issue I have with using AI as a brand reference point: It reduces a very complex issue to a knee-jerk reaction. We need to be thinking more about AI, not less. The consumer marketplace is not the right place to have a debate on AI. It will become an emotional pissing match, not an intellectually informed analysis. And to explain why I feel this way, I’ll use another example: GMOs.

How Do You Feel About GMOs?

If you walk down the produce or meat aisle of any grocery store, I guarantee you’re going to see a “GMO-Free” label. You’ll probably see several. This is another example of squeezing a complex issue into an emotional hot button in order to sell more stuff.

As soon as I mentioned GMO, you had a reaction to it, and it was probably negative. But how much do you really know about GMO foods? Did you know that GMO stands for “genetically modified organisms”? I didn’t, until I just looked it up now. Did you know that you almost certainly eat foods that contain GMOs, even if you try to avoid them? If you eat anything with sugar harvested from sugar beets, you’re eating GMOs. And over 90% of all canola, corn and soybeans items are GMOs.

Further, did you know that genetic modifications make plants more resistance to disease, more stable for storage and more likely to grow in marginal agricultural areas? If it wasn’t for GMOs, a significant portion of the world’s population would have starved by now. A 2022 study suggests that GMO foods could even slow climate change by reducing greenhouse gases.

If you do your research on GMOs — if you “think slow’ about them — you’ll realize that there is a lot to think about, both good and bad. For all the positives I mentioned before, there are at least an equal number of troubling things about GMOs. There is no easy answer to the question, “Are GMOs good or bad?”

But by bringing GMOs into the consumer world, marketers have shut that down that debate. They are telling you, “GMOs are bad. And even though you consume GMOs by the shovelful without even realizing it, we’re going to slap some GMO-free labels on things so you will buy them and feel good about saving yourself and the planet.”

AI appears to be headed down the same path. And if GMOs are complex, AI is exponentially more so. Yes, there are things about AI we should be concerned about. But there are also things we should be excited about. AI will be instrumental in tackling the many issues we currently face.

I can’t help worrying when complex issues like AI and GMOs are broad-stroked by the same brush, especially when that brush is in the hands of a marketer.

Feature image: Body Scan 002 by Ignotus the Mage, used under CC BY-NC-SA 2.0 / Unmodified

AI Customer Service: Not Quite Ready For Prime Time

I had a problem with my phone, which is a landline (and yes, I’ve heard all the smartass remarks about being the last person on earth with a landline, but go ahead, take your best shot).

The point is, I had a problem. Actually, the phone had a problem, in that it didn’t work. No tone, no life, no nothing. So that became my problem.

What did I do? I called my provider (from my cell, which I do have) and after going through this bizarre ID verification process that basically stopped just short of a DNA test, I got routed through to their AI voice assistant, who pleasantly asked me to state my problem in one short sentence.

As soon as I heard that voice, which used the same dulcet tones as Siri, Alexa and the rest of the AI Geek Chorus, I knew what I was dealing with. Somewhere at a board table in the not-too-distant past, somebody had come up with the brilliant idea of using AI for customer service. “Do you know how much money we could save by cutting humans out of our support budget?” After pointing to a chart with a big bar and a much smaller bar to drive the point home, there would have been much enthusiastic applause and back-slapping.

Of course, the corporate brain trust had conveniently forgotten that they can’t cut all humans out of the equation, as their customers still fell into that category.  And I was one of them, now dealing face to face with the “Artificially Intelligent” outcome of corporate cost-cutting. I stated my current state of mind more succinctly than the one short sentence I was instructed to use. It was, instead, one short word — four letters long, to be exact. Then I realized I was probably being recorded. I sighed and thought to myself, “Buckle up. Let’s give this a shot.”

I knew before starting that this wasn’t going to work, but I wasn’t given an alternative. So I didn’t spend too much time crafting my sentence. I just blurted something out, hoping to bluff my way to the next level of AI purgatory. As I suspected, Ms. AI was stumped. But rather than admit she was scratching her metaphysical head, she repeated the previous instruction, preceded by a patronizing “pat on my head” recap that sounded very much like it was aimed at someone with the IQ of a soap dish. I responded again with my four-letter reply — repeated twice, just for good measure.

Go ahead, record me. See if I care.

This time I tried a roundabout approach, restating my issue in terms that hopefully could be parsed by the cybernetic sadist that was supposedly trying to help me. Needless to say, I got no further. What I did get was a helpful text with all the service outages in my region. Which I knew wasn’t the problem. But no one asked me.

I also got a text with some troubleshooting tips to try at home. I had an immediate flashback to my childhood, trying to get my parents’ attention while they were entertaining friends at home, “Did you try to figure it out yourself, Gordie? Don’t bother Mommy and Daddy right now. We’re busy doing grown up things. Run along and play.”

At this point, the scientific part of my brain started toying with the idea of making this an experiment. Let’s see how far we can push the boundaries of this bizarre scenario: equally frustrating and entertaining. My AI tormenter asked me, “Do you want to continue to try to troubleshoot this on the phone with me?”

I was tempted, I really was. Probably by the same part of my brain that forces me to smell sour milk or open the lid of that unidentified container of green fuzz that I just found in the back of the fridge.  And if I didn’t have other things to do in my life, I might have done that. But I didn’t. Instead, in desperation I pleaded, “Can I just talk to a human, please?”

Then I held my breath. There was silence. I could almost hear the AI wheels spinning. I began to wonder if some well-meaning programmer had included a subroutine for contrition. Would she start pleading for forgiveness?

After a beat and a half, I heard this, “Before I connect you with an agent, can I ask you for a few more details so they’re better able to help you?” No thanks, Cyber-Sally, just bring on a human, posthaste! I think I actually said something to that effect. I might have been getting a little punchy in my agitated state.

As she switched me to my requested human, I swore I could hear her mumble something in her computer-generated voice. And I’m pretty sure it was an imperative with two words, the first a verb with four letters, the second a subject pronoun with three letters.

And, if I’m right, I may have newfound respect for AI. Let’s just call it my version of the Turing Test.

The Spark in the Jar: Jon Ive and Steve Jobs

I sold all my Apple stock shortly after Steve Jobs passed away. It was premature (which is another word for stupid). Apple stock is today worth about 10 times what I sold it for.

My reasoning was thus: Apple couldn’t function without Steve Jobs – not for long, anyway.

Well, 12 years later, it’s doing quite well, thank you. It has a stock price of almost $200 per share (as of the writing of this). Sales have never been stronger. While replacement CEO Tim Cook is no Steve Jobs, financially he has grown Apple into a monolithic force with a market capitalization of almost 3 trillion dollars. There is no other company even close to that.

Now, with the benefit of hindsight, I realize I underestimated Tim Cook. But I stand with my original instinct: whatever Apple was under Steve Jobs, it couldn’t survive without him. And to understand why, let’s take a quick look back.

Jobs was infamously ousted from Apple in 1985. He remained in “NeXTile” for 12 years, coming back in 1997 to lead Apple into what many believe was its Golden Era. He passed away in 2011.

In the 14 years Jobs led Apple in his second run, the stock price went from about 20 cents to about 12 dollars. That’s growth of about 6000%.  Steve Jobs brought Apple back from the brink of death. If it wasn’t for a lifeline thrown to it by its number one competitor, Microsoft, in 1997, Apple would be no more. As Jobs himself said, “Apple was in very serious trouble,” said Jobs. “And what was really clear was that if the game was a zero-sum game where for Apple to win, Microsoft had to lose, then Apple was going to lose.

But those growth numbers are a little misleading. For you to be one of the fastest growing companies in history, it helps when you start with a very, very small number. A share price of $0.20 is a very, very small number.

Much as everyone lauds Steve Jobs for the turnaround of Apple, I would argue that Tim Cooks performance is even more impressive. To say that Apple was already on a roll when Cook took over is an understatement. In 2011, Apple was going from success to success and could seem to do no wrong. That was one of the reasons I was pessimistic about its future. I thought it couldn’t sustain its run, especially when it came to introducing new products. How many Jobs inspired home runs could it possibly have in its pipeline?

But what Tim Cook was great at was logistics. He took that pipeline and managed to squeeze out another decade plus of value building thanks to what may be the best supply chain strategy in the world. Analysts have said that half of Apple’s 3 trillion dollars in value is directly attributable to that supply chain.

But when you squeeze every last inch of efficiency out of a supply chain, something has to give. And in this case, it may have been creativity.

The Job’s era Apple was a very rare and delicate thing in the corporate world: a leader who was uncompromising on user experience and a design team able to rise and meet the challenge. Was it dictorial? Absolutely. Was it magical? Almost always. It was like catching a spark in a jar.

That design team was headed by Jonathon Ive. And when you have a team that’s the absolute best in the world, you can put up with an asshole here and there, especially when that asshole keeps challenging you to be better.  And when you keep delivering.

The alchemy that made Apple spectacularly successful from 1996 to 2011 was a fragile thing. It wouldn’t take much to change the formula forever. For example, if you removed the catalyst – which was Steve Jobs – it couldn’t survive. But equally important to that formula was Jon Ive.

As David Price, the editor of Macworld said,

“What Ive brought to Apple was a coherent personal vision. That doesn’t mean Apple’s designs on his watch were always perfect, of course; there were plenty of missteps. In broader terms, his arch-minimalism could be frustrating for those who wanted more physical controls”

David Price, Macworld

Ive and Jobs were, by all accounts, inseparable. In a heartfelt tribute to Jobs published shortly after his passing, Ive remembered,

“We worked together for nearly 15 years. We had lunch together most days and spent our afternoons in the sanctuary of the design studio. Those were some of the happiest, most creative and joyful times of my life,” Ive wrote. “I loved how he saw the world. The way he thought was profoundly beautiful.”

Jon Ive

For Jobs and Ive – “Think Different” was both a manifesto and a mantra. That philosophy started a not-so-slow death the minute Jobs passed from this earth. Finally, in June 2019, Ive announced his departure “after years of frustration, seeing the company migrate from a design-centric entity to one that was more utilitarian.”

It seems that companies can excel at either creativity or execution. It’s very difficult – perhaps impossible – to do both. The Apple of Steve Jobs was the world’s most creative corporation. The Apple of Tim Cook is a world leader in execution. But for one to happen, the other had to make room. Today, Apple is trying to be creative by committee. Macworld’s David Price mourns the Apple that was, “Maybe Apple is no longer a company that focuses on individual personality, or indeed on thinking different. This week we also got the news that Ive’s replacement will not be replaced, with a core group of 20 designers instead reporting directly to the chief operating officer, who is no stranger to design and likely has his own ideas. If design by committee has been the de facto approach for the past four years, it’s now been made official.”

And committees always suck all the oxygen from the room. In that atmosphere, the spark that once was Apple inevitably had to go out.

It Took a Decade, but Google Glass is Finally Broken

Did you hear that Google finally pulled the plug on Google Glass?

Probably not. The announcement definitely flew under the radar. It came with much less fanfare than the original roll out in 2013. The technology, which has been quietly on life support as an enterprise tool aimed at select industries, finally had its plug pulled with this simple statement on its support page:

Thank you for over a decade of innovation and partnership. As of March 15, 2023, we will no longer sell Glass Enterprise Edition. We will continue supporting Glass Enterprise Edition until September 15, 2023.

Talk about your ignoble demises. They’re offering a mere 6 months of support for those stubbornly hanging on to their Glass. Glass has been thrown in the ever growing Google Graveyard, along with Google Health, Google+, Google Buzz, Google Wave, Knol – well, you get the idea.

It’s been 10 years, almost to the day, that Google invited 8000 people to become “Glass Explorers” (others had a different name – “Glassholes”) and plunge into the world of augmented reality.

I was not a believer – for a few reasons I talked about way back then. That led me to say, “Google Glass isn’t an adoptable product as it sits.” It took 10 years, but I can finally say, “I told you so.”

I did say that wearable technology, in other forms, would be a game changer. I just didn’t think that Google Glass was the candidate to do that. To be honest, I haven’t really thought that much more about it until I saw the muted news that this particular Glass was a lot more than half empty. I think there are some takeaways about the fading dividing line between technology and humans that we should keep in mind.

First of all, I think we’ve learned a little more about how our brains work with “always on” technologies like Google Glass. The short answer is, they don’t – at least not very well. And this is doubly ironic because according to an Interview with Google Glass product director Steve Lee on The Verge back in 2013, that was the whole point:

“We all know that people love to be connected. Families message each other all the time, sports fanatics are checking live scores for their favorite teams. If you’re a frequent traveler you have to stay up to date on flight status or if your gate changes. Technology allows us to connect in that way. A big problem right now are the distractions that technology causes.”

The theory was that it was much less distracting to have information right in the line of sight, rather than having to go to a connected screen that might be in your pocket.

Lee went on. “We wondered, what if we brought technology closer to your senses? Would that allow you to more quickly get information and connect with other people but do so in a way — with a design — that gets out of your way when you’re not interacting with technology? That’s sort of what led us to Glass.” 

The problem here was one of incompatible operating systems – the one that drove Google Glass and the one we have baked into our brains. It turned out that maybe the technology was a little too close to our senses. A 2016 study (Lewis and Neider) found that trying to split attention between two different types of tasks – one scanning information on a heads up display and one trying to focus on the task at hand – ended up with the brain not being able to focus effectively on either. The researchers ended with this cautionary conclusion: “Our data strongly suggest that caution should be exercised when deploying HUD-based informational displays in circumstances where the primary user task is visual in nature. Just because we can, does not mean we should.”

For anyone who spends even a little time wondering how the brain works, this should not come as a surprise. There is an exhaustive list of research showing that the brain is not that great at multi-tasking. Putting a second cognitive task for the brain in our line of sight simply means the distraction is all that much harder to ignore.

Maybe there’s a lesson here for Google. I think sometimes they get a little starry eyed about their own technological capabilities and forget to factor in the human element. I remember talking to a roomful of Google engineers more than a decade ago about search behaviors. I remember asking them if any of them had heard about Pirolli and Card’s pioneering work on their Information Foraging theory. Not one hand went up. I was gob smacked. That should be essential reading for anyone working on a search interface. Yet, on that day, the crickets were chirping loudly at Mountainview.

If the Glass team had done their human homework, they would have found that the brain needs to focus on one task at a time. If you’re looking to augment reality with additional information, that information has to be synthesized into a single cohesive task for the brain. This means that for augmented reality to be successful, the use case has to be carefully studied to make sure the brain isn’t overloaded.

But I suspect there was another sticking point that prevented Google Glass from being widely adopted. It challenged the very nature of our relationship with technology. We like to believe we control technology, rather than the other way around. We have defined the online world as somewhere we “go” to through our connected devices. We are in control of when and where we do this. Pulling a device out and initiating an action keeps this metaphorical divide in place.

But Google Glass blurred this line in a way that made us uncomfortable. Again, a decade ago, I talked about the inevitable tipping point that will come with the merging of our physical and virtual worlds. Back then, I said, “as our technology becomes more intimate, whether it’s Google Glass, wearable devices or implanted chips, being ‘online’ will cease to be about ‘going’ and will become more about ‘being.’  As our interface with the virtual world becomes less deliberate, the paradigm becomes less about navigating a space that’s under our control and more about being an activated node in a vast network.”

I’m just speculating, but maybe Google Glass was just a step too far in this direction – for now, anyway.

(Feature image: Tim.Reckmann, CC BY-SA 3.0 https://creativecommons.org/licenses/by-sa/3.0, via Wikimedia Commons)

Real Life Usually Lives Beyond The Data

There’s an intriguing little show you’ve probably never heard of on Netflix that might be worth checking out. It’s called Travelers and it’s a Canadian produced Sci-Fi show that ran from 2016 to 2018. The only face in it you’re probably recognize is Eric McCormack, the Will from Will and Grace. He also happens to be the producer of the series.

The premise is this – special operatives from the future (the “travelers”) – travel back in time to the present to prevent the collapse of society. They essential “body snatch” everyday people from our present at the exact moment of their death and use their lives as a cover to fulfill their mission.

And that’s not even the interesting part.

The real intrigue of the show comes from the everyday conflicts which come from an imperfect shoe horning of a stranger into the target’s real-world experience. The show runners do a masterful job of weaving this into their storylines: the joy of eating a hamburger, your stomach turning at the thought of drinking actual milk from a cow, calling your “wife” her real name when you haven’t called her that in all the time you’ve known her.  And it’s in this that I discovered an unexpected parallel to our current approach to marketing.

This is a bit of a detour, so bear with me.

In the future, the research team compiles as much as they can about each of the people they’re going to “borrow” for their operatives. The profiles are compiled from social media, public records and everything they can discover from the data available.

But when the “traveler” actually takes over their life, there are no end of surprises and challenges – made up of all the trivial stuff that didn’t make it into the data profile.

You probably see where I’m going with this. When we rely solely on data to try to understand our customers or prospects, there will always be surprises. You can only learn these little quirks and nuances by diving into their lives.

That’s what A.G. Lafley, CEO of Proctor and Gamble from 2000 to 2010 and then again from 20153 to 2015, knew. In a profile on Lafley which Forbes did in 2002, writer Luisa Kroll said,

“Like the monarch in Mark Twain’s A Connecticut Yankee in King Arthurs’ Court, Lafley often makes house calls incognito to find out what’s the minds of his subjects. ‘Too much time was being spent inside Procter & Gamble and not enough outside,’ says Lafley who took over during a turbulent period two years ago. ‘I am a broken record when it comes to saying, ‘We have to focus on the customer.'”

It wasn’t a bad way to run a business. Under Lafley’s guidance, P&G doubled their market cap, making them one of the 10 most valuable companies in the world.

Humans are messy and organic. Data isn’t. Data demands to be categorized, organized and columnized. When we deal with data, we necessarily have to treat it like data. And when we do that, we’re going to miss some stuff – probably a lot of stuff. And almost all of it will be the stuff of our lives, the things that drive behavior, the sparks that light our emotions.

It requires two different ways of thinking. Data sits in our prefrontal lobes, demanding the brain to be relentlessly rational. Data reduces behavior to bits and bytes, to be manipulated by algorithms into plotted trendlines and linear graphs. In fact, automation today can totally remove we humans from the process. Data and A.I. work together to pull the levers and push the buttons on our advertising strategies. We just watch the dashboard.

But there’s another way of thinking – one that skulks down in the brain’s subcortical basement, jammed in the corner between the amygdala and the ventral striatum. It’s here where we stack all the stuff that makes us human; all the quirks and emotions, all our manias and motivations. This stuff is not rational, it’s not logical, it’s just life.

That’s the stuff A.G. Lafley found when he walked out the front door of Proctor and Gamble’s headquarters in Cincinnati and into the homes of their customers. And that’s the stuff the showrunners of Travelers had the insight to include in their narratives.

It’s the stuff that can make us sensational or stupid – often at the same time.

Why Infuriating Your Customers May Not Be a Great Business Strategy

“Online, brand value is built through experience, not exposure”

First, a confession. I didn’t say this. I wish I’d said it, but it was actually said by usability legend Jakob Nielsen at a workshop he did way back in 2006. I was in the audience, and I was listening.  Intently.

But now, some 17 years later, I have to wonder if anyone else was. According to a new study from Yext that Mediapost’s Laurie Sullivan looked at, many companies are still struggling with the concept. Here’s just a few tidbits from her report:

“47% (of leads) in a Yext survey saying they were unable to make an online purchase because the website’s help section did not provide the information needed.”

“On average respondents said it takes nearly 9 hours for a typical customer service issue to be resolved. Respondents said resolution should take about 14.5 minutes.”

“42% of respondents say that help sites do not often provide the answers they look for with a first search.”

“The biggest challenge, cited by 61%, is that the help site does not understand their question.”

This isn’t rocket science, people. If you piss your customers and prospects off, they will go find one of your competitors that doesn’t piss them off. And they won’t come back.

Perhaps the issue is that businesses doing business online have a bad case of the Lake Wobegon effect. This, according to Wikipedia, is a “a natural human tendency to overestimate one’s capabilities.” It came from Garrison Keillor’s description of his fictional town in Minnesota where “all the women are strong, all the men are good-looking, and all the children are above average”

When applied to businesses, it means that they think they’re much better at customer service than they actually are. In a 2005 study titled “Closing the delivery gap”, Global consulting firm Bain & Company found that 80% of companies believe they are delivering a superior service. And yet, only 8% of customers believe that they are receiving excellent service.

I couldn’t find an update to this study but I suspect this is probably still true. It’s also true that when it comes to judging the quality of your customer service, your customer is the only one that can do it. So you should listen to them.

If you don’t listen, the price you’re paying is huge. In yet another study, Call Centre Platform Provider TCN’s second annual “Consumer Insights about Customer Service,” 66% of Americans are likely to abandon a brand after a poor customer service experience.

Yet, for many companies, customer service is at the top of their cost-cutting hit list. According to the Bureau of Labor Statistics, the projected average growth rate for all occupations from 2020 – 2030 is 8%, but when looking at customer service specifically, the estimated growth is actually -4%. In many cases, this reduced head count is due to companies either outsourcing their customer service or swapping people for technology.

This is probably not a great move.

Again, according to the TCN study, when asked what their preferred method of communication with a company’s customer service department was, number one was “talking to a live agent by phone” with 49 % choosing it. Just behind was 45% choosing an “online chat with a live agent.”

Now, granted, this is coming from a company that just happens to provide these solutions, so take it with a grain of salt, but still, this is probably not the place you should be reducing your head count.

One final example of the importance customer service, not from a study but from my own circle of influencers. My wife and I recently booked a trip with my daughter and her husband and, like everyone else in the last few years, we found we had to cancel the trip. The trip was booked through Expedia so the credits, while issued by the carrier, had to be rebooked through Expedia.

My daughter tried to rebook online and soon found that she had to talk to an Expedia Customer Service Agent. We happened to be with her when she did this. It turned out she talked to not one, but three different agents. The first flatly refused to rebook and seemed to have no idea how the system worked. The second was slightly more helpful but suggested a way to rebook that my daughter wasn’t comfortable with. The third finally got the job done. This took about 3 hours on the phone, all to do something that should have taken 2 minutes online.

I haven’t mustered up the courage to attempt to rebook my credits yet. One thing I do know – it will involve whiskey.

What are the chances that we will book another flight on Expedia?    About the same as me making the 2024 Olympic Chinese Gymnastic Team.

Actually, that might have the edge.

Risk, Reward and the Rebound Market

Twelve years ago, when looking at B2B purchases and buying behaviors, I talked about a risk/reward matrix. I put forward the thought that all purchases have an element of risk and reward in them. In understanding the balance between those two, we can also understand what a buyer is going through.

At the time, I was saying how many B2B purchases have low reward but high risk. This explains the often-arduous B2B buying process, involving RFPs, approved vendor lists, many levels of sign off and a nasty track record of promising prospects suddenly disappearing out of a vendors lead pipeline. It was this mystifying marketplace that caused us to do a large research investigation into B2B buying and lead to me writing the book, The Buyersphere Project: How Businesses Buy from Businesses in the Digital Marketplace.

When I wrote about the matrix right here on Mediapost back then, there were those that said I had oversimplified buying behavior – that even the addition of a third dimension would make the model more accurate and more useful. Better yet, do some stat crunching on realtime data, as suggested by Andre Szykier:

“Simple StatPlot or SPSS in the right hands is the best approach rather than simplistic model proposed in the article.”

Perhaps, but for me, this model still serves as a quick and easy way to start to understand buyer behavior. As British statistician George P. Box once said, “All models are wrong, but some are useful.”

Fast forward to the unusual times we now find ourselves in. As I have said before, as we emerge from a forced 2-year hiatus from normal, it’s inevitable that our definitions of risk and reward in buying behaviors might have to be updated. I was reminded of this when I was last week’s commentary – “Cash-Strapped Consumers Seek Simple Pleasures” by Aaron Paquette. He starts by saying, “With inflation continuing to hover near 40-year highs, consumers seek out savings wherever they can find them — except for one surprising segment.”

Surprising? Not when I applied the matrix. It made perfect sense. Paquette goes on,

“Consumers will trade down for their commodities, but they pay up for their sugar, caffeine or cholesterol fix. They’re going without new clothes or furniture, and buying the cheapest pantry staples, to free scarce funds for a daily indulgence. Starbucks lattes aren’t bankrupting young adults — it’s their crushing student loans. And at a time when consumers face skyrocketing costs for energy, housing, education and medical care, they find that a $5 Big Mac, Frappuccino, or six pack of Coca-Cola is an easy way to “treat yo self.”

I have talked before about what we might expect as the market puts a global pandemic behind us. The concepts of balancing risk and reward are very much at the heart of our buying behaviors. Sociologist Nicholas Christakis explores this in his book Apollo’s Arrow. Right now, we’re in a delicate transition time. We want to reward ourselves but we’re still highly risk averse. We’re going to make purchases that fall into this quadrant of the matrix.

This is a likely precursor to what’s to come, when we move into reward seeking with a higher tolerance of risk. Christakis predicts this to come sometime in 2024: “What typically happens is people get less religious. They will relentlessly seek out social interactions in nightclubs and restaurants and sporting events and political rallies. There’ll be some sexual licentiousness. People will start spending their money after having saved it. They’ll be joie de vivre and a kind of risk-taking, a kind of efflorescence of the arts, I think.”

The consumer numbers shared by Paquette shows we’re dipping our toes into the waters of hedonism . The party hasn’t started yet but we are more than ready to indulge ourselves a little with a reward that doesn’t carry a lot of risk.

The Split-Second Timing of Brand Trust

Two weeks ago, I talked about how brand trust can erode so quickly and cause so many issues. I intimated that advertising and branding have become decoupled — and advertising might even erode brand trust, leading to a lasting deficit.

Now I think that may be a little too simplistic. Brand trust is a holistic thing — the sum total of many moving parts. Taking advertising in isolation is misleading. Will one social media ad for a brand lead to broken trust? Probably not. But there may be a cumulative effect that we need to be aware of.

In looking at the Edelman Trust Barometer study closer, a very interesting picture emerges. Essentially, the study shows there is a trust crisis. Edelman calls it information bankruptcy.

The slide in trust is probably not surprising. It’s hard to be trusting when you’re afraid, and if there’s one thing the Edelman Barometer shows, it’s that we are globally fearful. Our collective hearts are in our mouths. And when this happens, we are hardwired to respond by lowering our trust and raising our defenses.

But our traditional sources for trusted information — government and media — have also abdicated their responsibilities to provide it. They have instead stoked our fears and leveraged our divides for their own gains. NGOs have suffered the same fate. So, if you can’t trust the news, your leaders or even your local charity, who can you trust?

Apparently, you can trust a corporation. Edelman shows that businesses are now the most trusted organizations in North America. Media, especially social media, is the least trusted institution. I find this profoundly troubling, but I’ll put that aside for a future post. For now, let’s just accept it at face value.

As I said in that previous column, we want to trust brands more than ever. But we don’t trust advertising. This creates a dilemma for the marketer.

This all brings to mind a study I was involved with a little over 10 years ago. Working with Simon Fraser University, we wanted to know how the brain responded to trusted brands. The initial results were fascinating — but unfortunately, we never got the chance to do the follow-up study we intended.

This was an ERP study (event-related potential), where we looked at how the brain responded when we showed brand images as a stimulus. ERP studies are useful to better understand the immediate response of the brain to something — the fast loop I talk so much about — before the slow loop has a chance to kick in and rationalize things.

We know now that what happens in this fast loop really sets the stage for what comes after. It essentially makes up the mind, and then the slow loop adds rational justification for what has already been decided.

What we found was interesting: The way we respond to our favorite brands is very similar to the way we respond to pictures of our favorite people. The first hint of this occurred in just 150 milliseconds, about one-sixth of a second. The next reinforcement was found at 400 milliseconds. In that time, less than half a second in total, our minds were made up. In fact, the mind was basically made up in about the same time it takes to blink an eye.  Everything that followed was just window dressing.

This is the power of trust. It takes a split second for our brains to recognize a situation where it can let its guard down. This sets in motion a chain of neurological events that primes the brain for cooperation and relationship-building. It primes the oxytocin pump and gets it flowing. And this all happens just that quickly.

On the other side, if a brand isn’t trusted, a very different chain of events occurs just as quickly. The brain starts arming itself for protection. Our amygdala starts gearing up. We become suspicious and anxious.

This platform of brand trust — or lack of it — is built up over time. It is part of our sense-making machinery. Our accumulating experience with the brand either adds to our trust or takes it away.

But we must also realize that if we have strong feelings about a brand, one way or the other, it then becomes a belief. And once this happens, the brain works hard to keep that belief in place. It becomes virtually impossible at that point to change minds. This is largely because of the split-second reactions our study uncovered.

This sets very high stakes for marketers today. More than ever, we want to trust brands. But we also search for evidence that this trust is warranted in a very different way. Brand building is the accumulation of experience over all touch points. Each of those touch points has its own trust profile. Personal experience and word of mouth from those we know is the highest. Advertising on social media is one of the lowest.

The marketer’s goal should be to leverage trust-building for the brand in the most effective way possible. Do it correctly, through the right channels, and you have built trust that’s triggered in an eye blink. Screw it up, and you may never get a second chance.

Data does NOT Equal People

We marketers love data. We treat it like a holy grail: a thing to be worshipped. But we’re praying at the wrong altar. Or, at the very least, we’re praying at a misleading altar.

Data is the digital residue of behavior. It is the contrails of customer intent — a thin, wispy proxy for the rich bandwidth of the real world. It does have a purpose, but it should be just one tool in a marketer’s toolbox. Unfortunately, we tend to use it as a Swiss army knife, thinking it’s the only tool we need.

The problem is that data is seductive. It’s pliable and reliable, luring us into manipulation because it’s so easy to do. It can be twisted and molded with algorithms and spreadsheets.

But it’s also sterile. There is a reason people don’t fit nicely into spreadsheets. There are simply not enough dimensions and nuances to accommodate real human behavior.

Data is great for answering the questions “what,” “who,” “when” and “where.” But they are all glimpses of what has happened. Stopping here is like navigating through the rear-view mirror.

Data seldom yields the answer to “why.” But it’s why that makes the magic happen, that gives us an empathetic understanding that helps us reliably predict future behaviors.

Uncovering the what, who, when and where makes us good marketers. But it’s “why” that makes us great. It’s knowing why that allows us to connect the distal dots, hacking out the hypotheses that can take us forward in the leaps required by truly great marketing. As Tom Goodwin, the author of “Digital Darwinism,” said in a recent post, “What digital has done well is have enough of a data trail to claim, not create, success.”

We as marketers have to resist stopping at the data. We have to keep pursuing why.

Here’s one example from my own experience. Some years ago, my agency did an eye-tracking study that looked at gender differences in how we navigate websites.

For me, the most interesting finding to fall out of the data was that females spent a lot more time than males looking at a website’s “hero” shot, especially if it was a picture that had faces in it. Males quickly scanned the picture, but then immediately moved their eyes up to the navigation menu and started scanning the options there. Females lingered on the graphic and then moved on to scan text immediately adjacent to it.

Now, I could have stopped at “who” and “what,” which in itself would have been a pretty interesting finding. But I wanted to know “why.” And that’s where things started to get messy.

To start to understand why, you have to rely on feelings and intuition. You also have to accept that you probably won’t arrive at a definitive answer. “Why” lives in the realm of “wicked” problems, which I defined in a previous column as “questions that can’t be answered by yes or no — the answer always seems to be maybe.  There is no linear path to solve them. You just keep going in loops, hopefully getting closer to an answer but never quite arriving at one. Usually, the optimal solution to a wicked problem is ‘good enough – for now.’”

The answer to why males scan a website differently than females is buried in a maze of evolutionary biology, social norms and cognitive heuristics. It probably has something to do with wayfinding strategies and hardwired biases. It won’t just “fall out” of data because it’s not in the data to begin with.

Even half-right “why” answers often take months or even years of diligent pursuit to reveal themselves. Given that, I understand why it’s easier to just focus on the data. It will get you to “good,” and maybe that’s enough.

Unless, of course, you’re aiming to “put a ding in the universe,” as Steve Jobs said in an inspirational commencement speech at Stanford University. Then you have to shoot for great.

In or Out: It’s Really About Making Sense of the Market

My fellow Insider, Maarten Albarda, tackled the inhouse vs outsourced question a few weeks ago in a thoughtful column. Today, I’m trying to repay thoughtfulness with additional thought provocation. The topic, I suspect, touches on the increasingly disruptive nature of marketing strategy.

As Maarten points out, when we think about bringing marketing inhouse, we also have to consider unintended consequences. But those fall on both sides of this question. What is probably a bigger question is how the company defines marketing. Because the answer to that question is not the same as it was 20 or 30 years ago. There, marketing was predicated on the assumption that the market was a fairly static and linear entity. But today, we are discovering that the market is complex, non-linear, adaptive and dynamic. And that discovery dramatically impacts the whole in-house vs outsourced question.

Maarten is absolutely right when he outlines many of the speedbumps (not to mention gapping chasms) that can lie on the path to bringing marketing inhouse. The reason, I believe, is that everyone involved is considering this plan based on the above-mentioned assumption. They aren’t factoring in the disruption that’s tearing the industry apart. And whether you’re continuing down the agency path or bringing marketing in house, you need to factor in that disruption. By doing so, you necessarily have to bring a different perspective to the decision and the things you have to consider.

Given the highly dynamic nature of the market, I believe there are two essential loops that have to be part of any marketing plan today. One of these is a robust and externally focussed “sense-making” loop. I’ve written about this before, in the context of search marketing.  The concept is borrowed from the fields of cognitive neuroscience, artificial intelligence and psychology. This shifts the fundamental precept of marketing, from that of crafting an internal strategy and executing it to a waiting market to that of constantly monitoring the evolving nature of the market and responding in real time. Strategy is still vital, but rather than an executable plan that plays out over multiple years, it’s a “frame” (to use the terminology of sensemaking) that has to be continually validated and – if necessary – updated. The other loop is a nimble and fully “tuned in” response loop. The two play together. One informs the other. They are also highly iterative. They have to continually be updated.

So, in considering this, one has to ask – are these loops better situated inside or outside of the organization. There are pros and cons on both sides of the question. Theoretically, for sensemaking, I would say the advantage lies on the agency side of the table.  Agencies should find it easier to maintain an objective, external focus. They also have the advantage of having “sensing” antennae over multiple clients, giving them a bigger and less myopic data picture. The challenge may come in matching the data to the existing frame. The frame – or strategy – is the nexus between the market’s reality and the marketer’s reality.  It is here where an agency may lose its advantage. Maarten rightly states that a company decides to bring marketing in-house, “these decisions have far-reaching consequences across the wider enterprise that impact working methods, required internal and external support structures, capital investment, HR policies, IT investment and talent, etc.” But I would argue that this should be true of marketing regardless of whether it lies within the corporate domain or at some agency boardroom table. Given the “real-time” reality of today’s marketing, it should be fully integrated into every aspect of the business. Siloes just can’t cut it. That’s a difficult integration when all the players are at the same table. I suspect it might be impossible when those players are at different tables within different companies.

One has to deeply consider the motivations for bringing marketing in-house. As Albarda notes, if it’s just cost saving, that’s a false economy. Control is also cited. That is getting closer to the issue, but it’s using the wrong language. Control is impossible. Responsiveness is a better label.

The motivation for bringing marketing inhouse should be exclusively to build the most robust sense-making and response loops possible.