Branding 2.0: Building a better broadcast marketing model

I’m preparing to take part in a Branding 2.0 panel on Wednesday, and for such events I like to try to come with a perspective that’s slightly different than what people expect. In turn, the short version of my position for this discussion is as follows:

Branding 2.0 is about leveraging the web 2.0 to deeply engage with a relatively small community of uniquely qualified minds and/or “prosumers” in order to co-create value propositions, as well as using it to do much better, cheaper, and targeted broadcasting to get the message (or offer) out to everyone else. Given the negative rap that the word “broadcasting” gets today this second part that is often ignored in 2.0 discussions, but it might well be the bigger opportunity.

What led to this line of thinking was simple – with the rise of the web 2.0 and social media, many people have jumped to the conclusion that it’s all about conversations, communities, and deep one-to-one (or many-to-many) engagement. While I am a believer there is a great opportunity on this front, something has always struck me as odd. If you look at a lot of the literature of community development and engagement, it’s not uncommon to see estimates of about 1% of people / consumers / prosumers actually being interested and talented enough to engage in such communities. From that base, an extraordinary amount of attention is directed towards how to create these communities and make them work – but far, far, less attention is given to how to connect with the 99% of other customers, and potential customers, that are out there. From what I’ve seen, doing so has a lot of similar properties to traditional broadcast messaging – but in a far superior way thanks to the web 2.0.

To get a little more specific, one company I’ve been watching closely is Starbucks, and I’ve done a fair bit of research around their MyStarbucksIdea site, and other similar online properties. I think it’s great, the 10,000 + ideas they’ve captured through the site are amazing, and it’s a fabulous example of getting customers engaged in the value creation process. But to put that 10,000 in perspective, Starbucks has 17,000+ retail outlets, and conducts 50,000,000 transactions a day. The percentage of customers that they directly engage via collaborative efforts like MyStarbucksIdea is extremely small, no matter how you slice it. And I don’t think that’s ever going to change.

So what should companies do about the other 99%+? Is it just a simple case of hoping word-of-mouth does it’s trick, and information trickles out from the their core base of prosumers into the broader community- in support of traditional broadcast marketing campaigns? I would argue no – and that companies need to think deeply about different ways to do “broadcast” marketing that leverages web 2.0 technologies. Again, from my experience a lot of people in social media react poorly to such statements – any mention of broadcasting is just so 1.0, and gets you kicked out of the club. But in my mind, the opportunity to re-invent broadcast marketing is a huge opportunity, and has to be approached very different than from a “conversational” social media mindset.

For example, when I worked in a Branding analytics department a few years back, we did a variety of detailed segmentation models, but one of the most useful was fairly simple – put usage on the X-axis, loyalty on the Y-axis, and the quadrant of high usage, high loyalty customers represented a large percentage of sales and profits (roughly the 80/20 rule). While I would imagine that most of the people that might engage in a community associated with our brands at the time would fall into that group, the vast majority of people there would have neither the interest or time to do so.

But what they might be interested in is engaging with the company directly – say, via something like Twitter today. And since one of our ongoing challenges was finding a way to target these select customers with messages and offers in a cost-effective way, something like Twitter could be amazing for that – free, simple, targeted. It’s not rocket science by any means – but the ability to reach interested customers with relevant information, for free, more or less whenever you want, is a remarkable development that’s not given enough attention.

Another thing to look at is finding ways to serve up ongoing value to these (and even less loyal) customers, instead of just serving them ads. Various experiments like Whole Foods and Kraft recipes are great examples – a valuable service the can open up an ongoing connection point, but isn’t necessarily about conversations or communities at all. On a similar front, instead of trying to think up how to serve ads over mobile devices like the iPhone, companies might want to focus their attention on coming up with a killer iPhone app.

There’s a lot more I can get into here, but I’ll stop it there for today. The main message is that the Web 2.0 is great, and communities are great – but you shouldn’t jump to the conclusion that this means broadcast is bad. One of the great examples of this, that I referenced earlier and went into great detail on in a recent research report, is how people and companies are actually using Twitter. While for many it’s a platform for conversations, under the surface there’s a new, better broadcasting model emerging – and I can name a huge number of popular accounts that, no matter how they might describe themselves, are basically just broadcasting information. It works, it’s powerful, and it’s a big part of the future of Branding 2.0…

Tagged as: branding 2.0, marketing, marketing 2.0, prosumers, social media, twitter