From competing with businesses within our cities to competing with organisations on the other side of the world.
By Patricio Vacchino, CEO of Distinto o Extinto (a La Capital special)
Our landscape, market and competitors are currently changing at unprecedented speed. Most businesses can hardly keep up with the thousands of consumers who are now more connected and informed than ever, and who—let’s face it—hold the actual power.
We need to be able to respond in a suitable manner to the phenomena that are taking place in our society from a marketing perspective.
A study conducted in 2019 by the Spanish marketing consultancy firm Daemon Quest found that, among the 700 Ibero-American marketing and communication executives surveyed, more than 80% are aware that clients search information about their products online before making a purchase decision. Surprisingly, though, over half of the respondents claimed that their businesses didn’t have an online strategy, a digital marketing plan.
When asked whether their clients search for information on their products on the Internet, most marketing execs say yes, but they don’t know exactly how many people behave like this.
Does it make sense to devise a digital marketing plan?
Right now, hundreds of new businesses are being born worldwide—in some cases, they consist of only one worker; sometimes more. Regardless of the industry they operate in, the product they sell or the country they are based in, these businesses are all equally likely to succeed. Why? Because the new market environment allows for competition and for the quest of the right niche, though only as long as companies understand that the rules of the game are continuously changing, and that technology and the web will welcome any kind of small business and let it play in the same league as the bigger firms. Such is the horizontal revolution that comes hand in hand with new technologies.
These emerging businesses need to know and acknowledge that, in some respects, the world has become flat, a change which has taken place so fast that some of the existing companies who long to adapt to the new landscape are actually finding it hard to do so. These companies are faced with competitors that belong to a class completely unknown to them until now. In just a matter of years, we went from competing with businesses within our cities to competing with organisations on the other side of the world, all due to globalisation and new technologies.
Some brands have a global dominance in the Internet now. While they barely existed a few years ago, today it is common to find news about Twitter, Facebook, Instagram, Glovo or Rappi across mass media.
As the world keeps changing, we find ourselves immersed in highly competitive environments, where markets are barely growing and consumers are increasingly less profitable. Processes are now digital, virtual, mobile.
Businesses find themselves competing in the midst of a red-ocean landscape, while customers have a myriad of options to choose from. The ability to choose is now the norm, and preferences are becoming more and more personal. We live in a world where Starbucks can create 19,000 different types of coffee and has turned its customers into coffee blend creators. Indeed, Starbucks knows that, now more than ever, the customer is king.
Conversely, on the flip side, the world we live in has become a complete karaoke, with cities and even homes looking and sounding pretty much alike, due to global organisations such as Ikea. Companies mirror one another, products are virtually the same, and differentiation barely exists. As Apple introduces a new update for its iPhone, other brands, like Samsung or LG, are launching (or have launched already) alternative products with features similar to those of the phone showcased by the company once run by Steve Jobs, all within the blink of an eye.
Product differentiators are now found in their brands, while customisation has reached unexpected heights.
Digital “wants” to beat traditional: unknown artists are winning audiences with their music online, whereas renowned stars need to adjust to a new reality.
We users are spending more and more time in front of the computer, and less time in front of the TV. We are multi-taskers and multi-screen. As a result, twentieth-century consumers are a lot more informed. The Internet has given a say to millions of people who boast a power of influence that knows no boundaries thanks to blogs; people who communicate with others through messages of 280 characters.
We are living in an era where consumers are self-directed through the Internet; where all the other tools in the flat world have resulted in a means by which each consumer can customise a product or service and its price exactly as they want to. Businesses can—and, in fact, they are already doing it—give customers the feeling that each product and service was designed as per their own particular needs and desires, even when, in fact, this is not quite so. “Customisation”—there it is, just another of Philip Kotler's dreams come true.
How can we stay afloat in this new landscape? Through innovation and differentiation. Innovating at the level of the business model and adopting a customer-centric approach will give businesses a competitive edge that will be both sustainable and hard to mirror by their competitors. Even if the competition may copy our product, it will be our business model, along with our people, what will make all the difference in the market.
The search for new differentiation formulae will be paramount. And people have—we have—a critical role in the present context. This is the end of marketing as we know it.
In the last few years, the world of marketing has gone through a process of evolution: it went from the product era to the brand era, to eventually reach the “prosumer” era, in which we now find ourselves. At present, besides traditional media, there are countless agents capable of creating insights about a product, a business or a brand.
But marketing is not just evolving. It is undergoing a completely radical change and experimenting total transformation due to phenomena like relationship, emotional, viral, 360 marketing, and, above all, transformation as a result of digital, online and interactive marketing. Still, marketing prevails.
As Sergio Zyman explains in his book The End of Marketing as We Know It, this new kind of marketing is no more than a business proposition. It's about brainstorming ideas and taking action in a consistent and careful way, in order to sell more to more people, more often and at a profitable price. If, through our marketing efforts, we don't manage to drive consumers to the register, with their hands full of banknotes to buy our product, then we had better keep from carrying out those actions.
Marketing is far too important to leave it all up to the Marketing team, again. That's why I love marketing—because it's the beginning of everything else. It's the heart of a business. Because, once we have a strategic marketing plan in place, we can understand what we are going to sell, who we will sell it to and how. Because it is the Marketing department, along with—hand in hand with—the Sales department, the ones that truly generate revenue. These are the areas which, at the end of the day, bring real money to the business. They bring real clients with real banknotes in their hands, ready to buy our product. And that is the point!