Here's something I wrote recently on InsightExec regarding a recent debate I attended on London on "Why Marketing isnt working anymore":
One of the main reasons why marketing has lost its relevance to today’s consumer is because of the negative and growing influence of CRM and direct marketing on marketing behaviour and practice. And here’s why ..
Since, the early 1990s, there has been widespread awareness and acceptance of how an authentic relational market orientation can create superior customer and brand value. Yet despite this consensus, why are marketing and brand managers STILL under (now mounting) pressure to adapt and align their practices with the changing needs, values and behaviour of consumers. Why do many brands still appear to forget the importance and role of the real relationships that should exist between themselves, consumers and society? Why do we live in a socio-economic vacuum of decaying trust? Why are most brands just wrapped in a surface veneer of humanity and “relationship gloss” that when consumers come into contact with them can be easily scratched off to see the awful reality that lurks inside?
I think this conundrum can be summed up with the present day marketer’s and CRMer’s obsession with what I call, “cleverness over relevance” and here is my humble attempt to explain why….
Despite the widely accepted value in human-centric values that sit at the heart of a true relational market and brand orientation, the attainability of such approaches has been undermined by an unreflective and narrow instrumental adoption (as Richard Varey writes in Relationship Marketing: Dialogue and Networks in the E-Commerce Era), particularly by the techno-centric CRM community and the precision- and efficiency-centric direct marketing community (there goes my future career in either .. any donations gratefully accepted…)…
Already in the last five years we have seen an 80% expenditure growth in UK DM (Now almost £12 billion spend in 2002 and probably over in 2003) and predictions show no sign of a let up. CRM expenditure also rises inexorably but I can’t be bothered to look up the figures…
Don’t get me wrong, when done well, particularly when combined with a powerful relationship-centric brand that is lived and enacted by all (OK, most) employees and delivered consistently through the customer experience both within and outside an organisation, CRM and DM can and do work (think Tesco, who effectively combine a powerful service and relational consumer/ market orientation with a highly fine-tuned micro-marketing capability using Clubcard).
But for me, marketing has lost its way precisely because of its overly-analytical and process-driven CRM and DM dependency. It uses (and the short-term, cost-efficiency mentality of the boardroom demands it does) more and more “automated marketing and CRM solutions” and technology as a means to manipulate and control consumer behaviour and response in favour of sales, control, efficiency, precision, responsiveness and measurement. The problem is that when the brain is taken out of marketing and put into a machine, the consumer simply becomes an object, a recipient of a predefined targeted piece of predefined communication and a passive set of bytes in a database waiting for an automated event to trigger an automated response through an automated script delivered by an unempowered and bored call centre operative.
As Malhotra puts it with reference to the dominance of tech in KM, we are witnessing the growth of an “information processing perspective” of marketing. This he states incorporates merely simplistic assumptions about human behaviour, usually in the form of routine rules of thumb and “best practices” for guiding future action and decisions. In a marketing context, the problem with the IP perspective is that it gathers the wrong form of customer knowledge – only that about consumers (usually basic profiles) and not real learning about the knowledge people possess or need in order to overcome their decision complexity and uncertainty – or value-gaps as Alan Mitchell calls them. Marketing emphasis on this form of knowledge ultimately limits its scope for experimentation and innovation, and as a consequence it loses its role and significance within organisations.
This is because the somewhat static and “syntactic” notion of knowledge used by CRMers and DMers can often disregard how employees in organisations should and can actually go about acquiring, sharing and creating new knowledge – i.e. that which is necessary to change their mindset and behaviour and ultimately deliver real breakthrough for consumers as individuals. Hence, automation is a Catch 22 and pumps up an increasing reliance on superficial “cleverness” and marketing “technique” rather than real and authentic “customer relevance”.
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