Push-Button Marketing

A lot has been written about the impact AI will have on [fill in the blank industry]. While it's being treated as new news, the reality is that it was a foregone conclusion as far back as the 1970s, when people like Bill Gates and Steve Jobs were designing smaller, faster, cheaper, and more user-friendly computers. By 2010 -- that is, 13 years ago -- the average consumer was already almost completely dependent on the Internet and their wireless phone.

Nowadays, of course, there isn't a single person or business that doesn't rely on digital technology all day every day.

Marketers know this, and just like every other business they want to leverage digital technology to automate marketing. AI is just the latest technology buzzword.

A few years ago I was asked about digital marketing by a brilliant woman who was in the process of launching a startup. Even though she had yet to launch her business, and didn’t yet have any insight into her target, she assumed I could do something like this:

It reminded me of several developments in the past that were going to revolutionize marketing (especially advertising):

1. When Cable TV hit 60%+ penetration, and we could add 5-10 lifestyle-specific networks to our ABC, NBC, and CBS buys
2. When people started using the Internet for email and rudimentary web surfing, and we could serve static banners, some of which were clickable
3. When cell phones became small and cheap enough, and people started using them for things other than phone calls (primarily texting)
4. Steve Jobs and the birth of the smartphone
5. When the “digital team” came up to the executive conference room and taught everyone how to create their own Facebook profile
6. When we realized we could access people’s Internet and mobile browsing history
7. When regular people and consumer companies started using the government’s GPS satellites, instead of just the Air Force

I’m old enough to remember all of these innovations, but truth be told I wasn’t smart enough at the time to pick up on the fundamental problem with everyone’s excitement: all of these advancements, as well as the current innovations in data and programmatic, are essentially just new platforms and processes. Imagine if your marketing experts came to you with a recommendation consisting of just a platform and process: 1) where your communications would be placed and 2) how they would get placed. Wouldn't it feel like something big was missing?

Marketing veterans – people older than 40, primarily – like to talk about big data’s ability to deliver “deep consumer insights” but this is false. Marketing grown-ups say it because they are old enough to remember learning this fundamental rule: effective marketing depends on making an emotional or even spiritual connection with people.

Big data didn't and couldn't reveal, for example, the tension parents feel wanting their kids to go outside, explore, and take risks, but worrying they may get hurt – a deep consumer insight that was perfect for a brand like Band-Aid, especially when coupled with the other insight not revealed by big data, that children actually felt like Band-Aid made their boo-boos better.

Yes, online surveys and questionnaires ask probing questions and responses (already digitized) can be merged with other datasets. Yes, some marketers have excellent first-party data that give them an excellent understanding of their consumers. If you’re starting from this place of deep understanding of your consumers, platforms and processes like social media and programmatic advertising can be very effective.

But what if you’re marketing a brand or product and it’s not an iPhone, Netflix, Amazon, Google, or other life-changing solution?

What if you're selling a commodity?

If you comb through marketing trade publications, LinkedIn, or any big advertising agency website, you come away with the idea that no matter what you’re selling there is a (usually proprietary) technology that will drive customers with the push of a button. Once that button is pushed though, you’ll find you need to deliver billions of impressions to get 50,000 people to click on your ad, 1,000 of whom ultimately buy your $10 product.

If it costs you $10,000 or less to get those 1,000 conversions, you’ll say it was worth it. You may not care that it translates to far less than a 1% conversion rate.

How is it that the biggest brands today (like Apple or Netflix) have high double-digit conversion rates? Is it because of big data and advertising technologies like programmatic and AI? No.

Remember all the big annual marketing summits, symposiums, pow-wows, and offsites where the CMO or other senior marketer would share an Apple, Nike, or Coca-Cola case study -- strongly suggesting that they want the same thing for their salty snack or bleach spray?

That was then. Today, your CMO wants to know how you're going to use AI to make their marketing cheaper and more effective.

AI, and all the other digital marketing technologies would work perfectly if we were all robots. But there is no way (yet) to directly connect all of their zeroes and ones to our neurons. No matter how sophisticated the technology, or how streamlined and automated the process is, your response rate will still be barely 1%. You may not care if it pays for itself, and maybe that's the point. But is that really something to get excited about?