Wednesday, May 30, 2007

Branding: Likely impacts of convergence

……Cont’d from last post

The Space Elevator is not a reality yet. Neither is the Jet Pack, the cultured meat or the food pill. None of this, however hurts as much as the lack of a Teleporter. For this little kid growing up in the slow paced, sedate New Delhi of the pre-liberalization days, Star Trek was a religion, Spock was almost a God(or at least what I wanted to be when I grew up) and the ‘Beam me up Scotty machine’ was the most practical and useful technology ever invented. The Teleporter was the fodder for a thousand daydreams, most often dreamt over unending, soul deadening school periods. To tell you the truth I still miss it on occasions.

Spock: This is what I wanted to be when I grew up. None of the pinching of the ears helped much though

In fact, as it turns out, most of the inventions that were promised by the science fiction authors of yesteryears have not come to pass. Yet, some of the stuff that has happened is nothing short of magical. Concepts like genetic engineering, the virtual world, nanotechnology etc. would all have been unthinkable for someone back in the ‘30’s or 40’s. One such development which has got me all excited these days is the much anticipated development of technological convergence or the coming together of data, telephony, Television and wireless services in a single network. Simply put, convergence will allow all these services to be delivered as data packets over a single network and instead of buying these services separately we will be buying them as a package from giant media/telecommunications/cable companies.

How would this affect the question of Branding discussed in the last post? While none of us has a crystal ball, its still a lot of fun to speculate about and try to imagine what might happen. I strongly believe that technological convergence will make it much easier for Marketers to stress different aspects of their brand to different audiences. If it is at all possible, then we might even see a world in which the same brand stands for different things for different groups of people. Such an event becomes a possibility because convergence will allow marketers to customize their product offerings/messages almost on an individual to individual basis.

Consider the following ads.

Both of them are Indian ads for the soft-drink major Pepsi. In terms of content, they are exactly the same. However, one of them has been made for North Indian audiences using Bollywood stars while the other ad has been made for South Indian audiences and uses stars from the Tamil film industry. Till today such efforts at customization of ads for different audiences whether based on location, or age or other demographic factors has been carried out at a very aggregate level. This means that many North Indian families living in the South would have had to watch an ad that they perhaps did not identify with. However, I believe that the coming of technological convergence will allow marketers to carry out such customization on a much more fine-grained level.

Traditionally, agencies like AC Nielsen in the US as well as MODE or IMRB in India used to monitor the TV viewing habits of a number of different carefully-chosen households. This information was then used to design TV shows for the next season. In contrast, the coming of web servers has allowed marketers to observe the online behavior of millions of consumers and to produce customized content/products as well as deliver customized ads to them. Once convergence happens, we will find that marketers or specific companies will actually be able to track not only consumer’s online behavior but also their TV and telephone habits. Marketers would probably be able to track what people’s favorite music is, what sort of movies they like or what their favorite color is. On top of this, by analyzing this raw information, they will also be making certain conclusions about things like what particular consumers suppressed desires are, what attributes they might want in a shoe or even who they might vote for in the next elections. How good or bad these conclusions are depends entirely upon the sophistication of the analysis methods used. Like any other science, I am sure the accuracy of such analyses will improve with time.

As this accuracy improves, marketers will be better able to customize specific content and ads and even particular product offerings towards particular segments. Given the fact that everything is transmitted over a single network as data packets, customization will be possible on an individual to individual basis. This means that in the same apartment building, a North Indian family might see the North Indian ad for Pepsi while their neighbors see the South Indian version of it, the older couple might be seeing more ads related to medicines while the younger ones might see more ads with sports stars in them.

Not only will such customization be possible on an individual to individual basis but because of convergence it might be possible to carry out such customization in a very consistent manner across all media. Since the same network supports Cable, Telephony and Internet marketers can make sure that individuals always see the same ads across the various mediums thus ruling out any chances of dissonance in their idea of the brand. The price conscious customer might always see ads for a brand which stress its affordability while the style conscious consumer will always see ads which stress the style factor of the product.

Customization: Because different people want different things

Thus, we might end up in a world where the same brand has different identities for different segments of consumers. Of course, as I discussed in my last post it is highly arguable if such a thing is at all possible. Man being a social animal, social interaction and a process of back and forth feedback forms a big part of his forming an idea about a particular brand. This creates the scope for a lot of dissonance if everyone else has a completely different idea about the brand. However, whether or not a particular brand can have multiple brand identities is not important for this discussion, what is important is that the coming of convergence will provide marketers the ammunition to be able to try such stuff. At the very least they should be able to subtly emphasize different attributes for different consumers.

That in itself, is an exciting development. I have no doubt that a lot of marketing practices that we now follow will become obsolete or evolve rapidly in the coming decades. It looks like a really good time to have graduated from a B-school. Now if only the Teleporter thing worked out as well………..these airline prices are driving me crazy.


Anonymous said...
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Shan said...

Customization is the only way forward isn't it. Why just advertising, even in other industries, an organization that customizes its products has already stolen a march on generic product producers - be it holiday packages, or homes, or education.

Convergence is exciting and can only help. The only question is whether the corresponding loss of privacy if worth it or not, but that's another debate...

Keshi said...

r u a Marketing student?


Rahul said...

Not really. I am really a General Management student, since I took a mix of electives from different areas based on Professors assesments rather than choosing all electives from one functional area. However, my main area of interest is Technology and Marketing/Branding.

Cinamon said...

You have been tageed ...