The Experience Economy
Gregory Roekens on the experience economy: how we got here, and what to expect
March 29, 2017
Your title, Future Technology Officer, is new for a creative agency. What is your role at Grey?
My role at Grey is very future focused and is essentially a combination of a Chief Technology Officer, Chief Innovation Officer and Chief Digital Officer. I work to identify trends occurring in the industry and try to anticipate them, to develop new business models and services that meet the needs of our clients in the most effective way.
The advertising industry has seen dramatic changes. What are the new dynamics at work?
We are facing many changes in our industry. In the past, digital was the ultimate goal but today everyone is fully submerged in the digital world. It is now the default and every agency can be called digital. The new goal, or the new frontier if you will, is the Experience Economy. These days people value experiences that new products and services can unlock more than the products and services themselves. This represents a massive opportunity for businesses to deliver against this new economy and we feel our industry has a lot to offer in this space.
What has been the journey towards the Experience Economy for branding?
If you analyse the history of brand communication in the last few decades, you’ll find that we’ve gone through three stages. In the early days of branding, at the time when advertising was still seen as a trusted source of information, ads focused on communicating the unique selling points (USPs) of products.
Over time, simply communicating product attributes was no longer effective and the industry moved towards the second stage of more ‘emotionally’ intelligent advertising, harnessing emotions (ESPs) rather than USPs. Here, TV was the perfect medium for brands to communicate their values through storytelling.
It is worth noting that, during these two first stages, the level of data that was available to brands and consumers benefitted the former thanks to market research and focus groups. This led to a deeper knowledge of the consumer which gave brands the upper hand.
Today we are in the third stage of branding, where communicating USPs and ESPs is no longer sufficient. Storytelling must be enhanced through the delivery of memorable experiences (XSPs), thereby expanding our role into one of generation and engagement.
In this new branding era, it’s the consumer who benefits with access to a multitude of sources (reviews, ratings, comparison sites, user generated videos etc.) They are now able to validate, assess and evaluate products, ultimately drawing their own insights.
What are the implications of these changes for advertisers?
Consumers increasingly turn away from advertising as a trusted source of information, with technology making it easy to avoid, block and skip ads. This is a great challenge for the industry and for all those who are concerned with finding new ways to engage with and persuade our audiences.
We are slowly witnessing a paradigm shift to solutions that can change lives for the better. Brand fame can still be achieved but it has to be done in a more profound, meaningful way. In ways that meet new cultural trends and help people achieve their personal goals, one great experience at a time.
How does this affect agencies in particular?
This means clients require a new type of agency to help them deliver the best brand possible, not only through communicating product attributes and demonstrating emotional intelligence but also through the delivery of a multitude of memorable micro-experiences. This is the transformation we at Grey are currently going through.
What opportunities has technology created for advertising?
Many opportunities, however, it is important to specify that technology is not an end in itself and should be employed by agencies to create powerful stories and memorable experiences.
Just think about what is possible thanks to artificial intelligence. Brands are experiencing a virtual personification. In the future, it will be completely natural to talk to brands’ chatbots just as we would talk to a human being. However, a company represented by AI must still be able to demonstrate and embrace its brand values and characteristics and communicate them in a human and conversational manner. This is an exciting new opportunity for copywriters and scriptwriters.
So, in your opinion, is Artificial Intelligence the instrument that disrupts our industry the most?
If we are talking about one-to-one relationships, definitely. In the past we were not able to talk to consumers individually, only mass or segmented communication was possible. Now we can start to develop lines of dialogue aimed at individual persons. However, with this type of communication, the trust factor around data privacy is still a barrier and the industry in general still has a lot of work to do to earn that trust.
It seems clear now that AI will play an increasingly important role in the relationship between consumer, client and agency. What’s the next step?
To advertise to robots. Consumers are increasingly using virtual personal assistants like Alexa and Siri who now have our credit card details (via Apple Pay, Android Pay, Amazon Prime, etc.) and can technically shop on our behalf. Google have also recently announced that it is now possible to purchase items using Google Home.
We’re looking at an impending shift of purchase decisions to robots, starting with commodity products and services (“Hey buddy, renew my car insurance”). This means that brands will need to consider how to advertise to robots so that they favour and buy your products instead of your competitions’ – resulting in a much closer machine-to-machine relationship than ever before.
Currently, we are optimising content to influence rational decision-making processes for AI and emotional decision processes for humans. Ultimately, however, it seems increasingly likely that machines will be able to feel emotions. This will change the way we communicate and direct our messages, not only through UIs but also APIs.
How does Grey help clients seize opportunities and overcome the challenges that arise from new channels and tools?
We have developed a proprietary 3-step innovation framework that is applicable to all clients and all types of business problems. The output can lead to a new product, service, brand positioning, sales channel, or indeed a new advertising campaign.
First, we conceive the idea for a product, service or experience based on tangible insights, from which we elaborate a hypothetical business case. Then we develop a prototype that we iteratively test and improve. Speed is of the essence and it is also essential to engage consumers and business stakeholders in this process. Hearing their initial thoughts is critical to the development of the product itself. Then we work closely with the consumer to continue to get constant feedback. Lastly, once we’ve proven the business case we look at full-scale deployment.
We are perfectly placed between consumers & customers, brands, speed and magic. As we understand the consumer and know how to make brand famous, we can combine our creative experience, agility and tech expertise to participate in the design and implementation of business solutions, not just communication ones. In terms of monetization, this results in the exploration of new business models, alternative to those used until now.
2017 is the 100 year anniversary of Grey. We are “Famously Effective” and we intend to continue to be so, expanding our horizons to data, innovation and technology.
This article first appeared in Engage.it