Wednesday, July 01, 2015

Marketing Beyond MadTech: What Happens When The Robots Take Over?

I’ve recently found myself bouncing between three worlds:

- today’s world, where I spend my time reviewing software and helping marketers choose martech products. Since most of that discussion is currently phrased in terms of building a marketing stack, let’s call it the world of “stacktech”.

- tomorrow’s world, about two to five years in the future.  This is dominated by the merger between martech and adtech, a.k.a. “madtech”. The trends shaping this world are well known and many people agree on the broad outlines of what it will look like. I spend my time filling in the details since details will determine which tools and skills marketers need for success.

- the future world, out five years and beyond.* There’s much less agreement on how this will look and it’s arguably too far away for most marketers to worry about. But I do have a vision which I think may be useful to vendors and managers making long term plans. Since the dominant feature of this world will be an expanded role for machines, I’ll call it “robotech”.

Each of these worlds is very different from the others. Today’s marketing stack is still largely about tools to manage direct interactions between customers and the company. It works with the company’s own data and primarily through company-owned media like email and Web sites. Customer activities with anyone other than the company are largely invisible to the company.

By contrast, advertising and social messages in the "madtech" world are tightly integrated with company-owned channels and all customer behaviors are visible (for a price). The technical symbol of this transition is the change I wrote about last week from linear, company-driven campaign flows to customer-triggered experience plays.

The "robotech" world brings yet another radical shift.  In this future, humans have delegated increasing numbers of day-to-day decisions to their machines. My recent speeches have illustrated this with a vignette about a person in headed home in her self-driving car: she works quietly in her virtual office while her devices debate whether to stop for fuel, buy her coffee, avoid donuts, and get milk for breakfast. Only once the machines have reached a consensus do they inform her of the decision.

The example is trivial but the implications are profound. When machines buy on behalf of their owners, then marketers will sell to the machines. Since the machines will decide on the basis of algorithms, marketing becomes a matter of understanding and appealing to those algorithms. We already do this today in specialized areas like search engine optimization (“selling” to Google for a higher ranking) and programmatic media buying (providing more data about impressions so they earn higher bids). This sort of marketing is fundamentally different from both stacktech and madtech. My rough calculations show that nearly half of all consumer expenditures could eventually shift to machine control.

Humans still play an important role in the robotech world. It’s not just that they’re paying the bills for purchases by autonomous agents – a relationship familiar to any parent of a teenager. It’s also that humans are choosing the agents themselves. This is essentially a subscription: people will pay for a service that manages individual purchases. Since the details of each agent’s algorithm will be too hard to evaluate directly, the subscriptions will ultimately be purchased on the basis of trust.  This is a classic goal for traditioinal brand marketing but quite a change from the madtech focus on optimizing shorter-term metrics such as response or immediate revenue.

I don’t think the rebirth of brand marketing will mean a return to the simple-minded glories of the Mad Men era – we’ll still have all that data and all those channels to work with. But it might just possibly mean a less frantic urge to respond to every twist in the customer journey, replaced by broader, more stable messages aimed at building brand trust and a long-term relationship. In a world where customers increasingly filter out marketing messages and rely on machines to manage many steps in their customer journey, marketing approaches that deliver a few general messages may ultimately be the best use marketers can make of the limited customer attention they have available.

In sum, the transition madtech to robotech will be just as wrenching as the transition from stacktech to madtech.  Marketers should recognize that both are coming, even if it's too soon to prepare for the robotech world.  The time for that will come very quickly and it's always good to have at least thought about it in advance.

* Serious planners think much further out, in terms of decades. But I don’t think anything usefully concrete can be predicted that far in advance.

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