Digital isn't just everywhere, it will soon be everything.
Since the 1980s, digital has been in an unrelenting phase of hypergrowth. In our lifetimes, we've witness centralized mainframe computers morph into distributed desktop computers connected to a network. By the late '90s most of those machines were instead connected to the World Wide Web. The next decade brought with it cloud and ubiquitous computing, technologies for anywhere, any time mobile users.
Up next? Pervasive computing. Processors will be embedded in everyday objects to gather data for analysis and action, the catalyst of a new ‘phygital’ world in which digital connections bridge the physical and digital worlds. The Internet of Things (IoT), beacons, and sensors already enable a far deeper "conversation" between all elements of brand experience – including objects.
Connected Devices – Impact
Increasingly, consumers no longer differentiate between media and channels. Second screen activity is already transforming how they watch television, for example. They may simultaneously be shopping, buying, voting, emailing, or chatting with friends, posting on social media or looking up information about the show they are watching. They're likely not even viewing content on a TV. Cord-cutting is rampant. Consumers no longer care about platform or media ownership, what matters is access and convenience.
So how do marketers find these fickle consumers, flitting between channels like digital hummingbirds? It depends. Any individual’s preference will be based on their own unique pain points and needs, the time and location when that need strikes, their behavior, history, culture, exposure to technology, peer influences, and myriad other factors.
What is clear however is that the CMO must be as agile and multifaceted as the increasingly varied customer journeys they steward. Their brands are compelled to be omnichannel, and that "omni" accounts for ever-more channels and devices. The CMO's mandate is to bind omnichannel together with seamless customer experiences bound by the Three Cs:
- Consistency: Consistency in brand tone, outreach, response, presence, and culture. Expanding touchpoints allows brands to pervade consumers’ lives by providing timely content, services, and utility
- Content: Content is the unifying element of how brands manifest across all touchpoints across channels, platforms, and devices, online or off.
- Context: Context is the antidote to endless, noisy media proliferation. Data helps companies better understand customer context down to the individual level, including (but not limited to) personal, location, historical, behavioral, cultural, social, technological, and beyond.
MGM Resorts sends hotel guests at the Bellagio Las Vegas notifications on the MGM app for nearby restaurants, shopping, and shows via their smartphones. Offers are highly personalized based on a number of factors: geo-location, time of day, loyalty member status, purchase history, and preferences. You might get a twofer ticket offer for tonight's show, while I receive a steak dinner special.
A non-mobile example of the new “phygital” frontier is Navdy, an in-car display system that's been called the Google Glass for your car. It shows the driver relevant messages: navigation, text and voice messaging, and vehicle service notifications, for example.
Beacons and sensors in retail locations can not only convey inventory information, but provide consumers with highly contextual offers. Sensitive to the shelf level, embedded devices know if the shopper is browsing ketchup or mustard and can tailor offers accordingly.
‘Phygital’ Risks and Rewards
Harnessing digital connections to foster deeper human interactions is the opportunity in bridging the digital and physical worlds. For brands and consumers alike this means:
- Increased relevance and context
- Greater visibility
- Greater utility (“brands as service partners’)
- Happier, more engaged customers
- Data that inform optimization opportunities (across customer and product lifecycles)
- Increased loyalty
- Improved conversion and business results
- Market differentiation
As with other emerging technologies, the “phygital” world is also not without risks, particularly if strategy is secondary to a tactical approach. Risks can include:
- Attribution Impact
- Losing (or losing track of) customers along their journeys
- Viewing mobile as a secondary channel
- Advertising-only mentality
- Annoying or creeping out customers > opt-out
- Higher possibility of friction in “offline” contexts
- Under-use of content and brand assets
- Negative impact on brand sentiment/experience
- Ineffective or unethical use of data
- Wasted investment
Planning for an omnichannel “phygital” world requires a renewed commitment to digital transformation. This includes orchestrating across not only internal teams but also agency and technology vendor partners. Planning must take into account media convergence, with a strong view toward integrating technologies to "play nice" together, everything from marketing to mobile tech to systems that may live outside of marketing's purview, such as CRM.
Ready or not, we're hurtling into a brave new world. Brands that aren't at the ready in the channels and media, times, and places where customers and prospects wish to interact will in just a few short years risk irrelevance, even obsolescence.