Martech in 2023 will be the Year of 4PO (Part 9)

Predictions

2022 has been the year AI came to the fore. In an article entitled “From Prediction to Transformation” in Harvard Business Review, Ajay Agrawal, Joshua Gans and Avi Goldfarb write:

In some cases, AI simply concentrates decision-making without changing who has control. Look at the hiring process, which in most large organizations is managed by the human resources department. Traditionally, hiring has involved a great many HR people who make a lot of small decisions, especially about screening applicants, which can require teams of people looking through hundreds of résumés in order to identify promising candidates to interview. Thanks to AI, one HR executive can decide what criteria to use to decide who gets an interview. The basic process and the key decision-maker remain the same, but fewer people are needed.

In other cases, AI radically centralizes decision-making, completely changing how and where it happens. Credit card verification is a case in point. Before the rollout of connected devices that automatically validate cards, merchants would make their own judgments about whether to accept someone’s card. They could reject it if they suspected fraud—for instance, if someone’s signature didn’t match the one on the card or a customer didn’t have supporting ID. And they could readily accept cards from regular customers. But systems driven first by crude database checks and now by AI prediction have automated the process. Credit card purchases are approved according to rules set by a small group of people, most likely a committee, which creates the risk parameters embedded in the programs that run verification devices.

In marketing, AI has already started having an impact – predicting segments to send campaigns, predicting churn, predicting next best actions for customers, helping with subject line optimization and send-time optimisation (for emails). Generative AI is already helping marketers create content and images.

So far, marketers have worked largely on first-party data. With zero-party data, the data models can get even stronger, and help marketers address the most important problem of the next best action for customers. We are delighted when we get an email recommendation or see a product that preempts and piques our interest – the next book to buy, the next web series to watch, the next dress to check out, the next destination to vacation in. Marketers have so far relied on signals from user actions (search terms, links clicked). Once this can be augmented by zero-party data where customers can tell them what they are looking for in natural language or even interactively via a chatbot conversation, the accuracy of predictions can be multiplied – thus creating more transactions and loyalty.

In 2022, we have seen what GPT3 can do. Rob Toews outlines in Forbes what its successor will be capable of: “It is possible that GPT-4 will be multimodal: that is, that it will be able to work with images, videos and other data modalities in addition to text. This would mean, for example, that it could take a text prompt as input and produce an image (like DALL-E does); or take a video as input and answer questions about it via text. A multimodal GPT-4 would be a bombshell. More likely, however, GPT-4 will be a text-only model (like the previous GPT models) whose performance on language tasks will redefine the state of the art. What will this look like, specifically? Two language areas in which GPT-4 may demonstrate astonishing leaps in performance are memory (the ability to retain and refer back to information from previous conversations) and summarization (the ability to distill a large body of text to its essential elements).”

Predictions follow naturally from implementing a Martech 2.0 unified stack and aggregating zero- and first-party data in a single customer data platform. Think of the memorable experiences we have had where an intelligent salesperson in a store guides us to exactly the product we want. Tomorrow’s AI-powered virtual agents will have a “digital twin” for each of us, and software agents will engage us in conversation, predict our next actions, and end us just-in-time alerts. Powered by rapidly improving AI engines, 2023 will be the year this new customer-centric world will start coming to life all around us.

Thinks 758

Elections Science has an assessment of 6 single-winner voting methods: “Choose one candidate, the candidate with the most votes wins; Rank candidates, the candidate beating everyone head-to-head, inferred through these rankings, wins—if that candidate exists; Rank candidates, use rankings to simulate sequential runoffs across rounds until the winner has the majority of the remaining 1st-choice rankings; Range Voting (Score candidates, highest scored candidate wins); STAR Voting (Score candidates, use scores to simulate a runoff between the two top scoring candidates); Choose all approved candidates, the candidate with the most votes wins.” The winner: “Approval voting has the voter choose as many candidates as they approve of. That is, the voter would be satisfied with any of the candidates they chose. The candidate with the most votes (equivalent to the highest approval percentage) wins….Approval voting performs an exceptional balance of both selecting a strong winner and capturing each candidates’ support while at the same time being remarkably simple. That is an especially hard balance to reach, and no other voting comes nearly as close.” Approval Voting FAQs.

NYTimes: “Ten thousand years after our species began forming primitive agrarian societies, a panel of scientists on Saturday took a big step toward declaring a new interval of geologic time: the Anthropocene, the age of humans. Our current geologic epoch, the Holocene, began 11,700 years ago with the end of the last big ice age. The panel’s roughly three dozen scholars appear close to recommending that, actually, we have spent the past few decades in a brand-new time unit, one characterized by human-induced, planetary-scale changes that are unfinished but very much underway. “If you were around in 1920, your attitude would have been, ‘Nature’s too big for humans to influence,’” said Colin N. Waters, a geologist and chair of the Anthropocene Working Group, the panel that has been deliberating on the issue since 2009. The past century has upended that thinking, Dr. Waters said. “It’s been a shock event, a bit like an asteroid hitting the planet.””

FT in conversation with Nouriel Roubini: ““I was born in 1958 in Turkey, then moved to Tehran then to Israel, then Italy,” says Roubini. (His father imported Persian carpets to Milan; the whole family later moved to the US. Roubini sees himself as a citizen of the world.) “Did I ever worry about a war among great powers? No way. There was the detente in the 1970s, and Nixon went to China. The risk of nuclear war went to zero. Did I worry about climate change? Never even heard about climate change. Did I worry about global pandemics? The last one had been 1918. Did I worry about AI destroying most jobs? Did I worry about deglobalisation, trade wars? No way. Did I worry about populist parties of extreme right or left coming to power? We didn’t have the same polarisation we have today. Did I worry about major severe recession or great depression? Of course not. In the 1970s we had stagflation but then we had the great moderation. Did I worry about financial crisis? I never heard about financial crisis. This time is different, but it’s different relative to the last 75 years of relative peace, progress and prosperity, because before then the history of humanity was a history of famine, war, disease and genocides and so on. The last 75 years are an exception, they’re not the rule.”

New Yorker: “Classical computers speak in the language of bits, which take values of zero and one. Quantum computers, like the ones Google is building, use qubits, which can take a value of zero or one, and also a complex combination of zero and one at the same time. Qubits are thus exponentially more powerful than bits, able to perform calculations that normal bits can’t. But, because of this elemental change, everything must be redeveloped: the hardware, the software, the programming languages, and even programmers’ approach to problems…A full-scale quantum computer could crack our current encryption protocols, essentially breaking the Internet. Most online communications, including financial transactions and popular text-messaging platforms, are protected by cryptographic keys that would take a conventional computer millions of years to decipher. A working quantum computer could presumably crack one in less than a day. That is only the beginning. A quantum computer could open new frontiers in mathematics, revolutionizing our idea of what it means to “compute.” Its processing power could spur the development of new industrial chemicals, addressing the problems of climate change and food scarcity. And it could reconcile the elegant theories of Albert Einstein with the unruly microverse of particle physics, enabling discoveries about space and time.”

Yiren Lu writes about how to process negative feedback. Among the suggestions: “Ask for specific examples and feedback. Cross-check negative feedback against historical pieces of negative feedback that I’ve received. If multiple people have given me the same piece of negative feedback independent of each other, I’ll take it seriously. Put processes in place for improvement in the future and communicate that to the feedback giver. Separate out the feedback itself from the way it was delivered…Don’t procrastinate on addressing negative feedback. The longer I wait, the larger it looms in my head, when often it’s a relatively small thing.”

Martech in 2023 will be the Year of 4PO (Part 8)

Personalisation – 2

Zero-party data can improve personalisation which first-party data simply cannot.

Tim Ringel (Clickz): “Zero-party data is information willingly or even proactively shared by consumers with the brand. It might be in the form of surveys, loyalty programs, and preferences. They share it because they perceive value in that sharing… With zero-party data, marketers can now get consumers’ explicit consent to use their data and continue to create individualized experiences without sacrificing privacy. This will build a stronger long-term stronger relationship with consumers. But only if you give them a reason to consent… Once marketers can provide a solid incentive for consumers to willingly share their data, consumers will regain trust and reclaim ownership of their experiences. If you have consistent customers who enjoy your offerings, they are more likely to share their information. Moreover, they’re also more likely to be ambassadors of your brand.”

Zack Hamilton (Fast Company): “Customer-permissioned zero-party data is the catalyst to balancing data acquisition needs. It will also meet the privacy and compliance demands. This new strategy will require organizations to elevate data as an experience. New stakeholders have to get engaged. Cross-functional relationships between marketing, data science, legal, privacy, and compliance will become critical… Zero-party data will enable brands to increase customer trust and loyalty. Hyper-personalization will have positive business impact, including reducing customer acquisition costs (CAC) and increasing average order values (AOV) and customer lifetime value (CLTV).”

Vlad Gozman (Forbes): One of the key benefits of zero-party data is that it’s more trustworthy than third-party data. Because customers share it willingly and know that it’s being used by the brand, they’re more likely to trust the brand with their personal information. Another benefit of zero-party data is that it’s more accurate. Because customers supply it directly, there’s less opportunity for errors or inaccuracies. And finally, zero-party data is more engaging. Brands that use it can create more personalized customer experiences, which leads to higher engagement rates and longer customer lifespans. As consumers become increasingly privacy-aware, brands will need to rely more on zero-party data to create trusted, personalized relationships with their customers. Further, Apple’s move to block cross-app tracking and the trend of browsers toward tracking prevention may make traditional tracking models obsolete.”

The key to unlocking personalisation powered by zero-party data is by leveraging E2L2 (Email 2.0 and Loyalty 2.0). Email 2.0 enables interactivity and Loyalty 2.0 adds micro-incentives (Atomic Rewards) for actions. As I wrote in Loyalty 2.0: How Brands can Tokenise Customer Attention and Data: “Every customer is different. While segmentation is better than mass communication, what’s even better is hyper-personalisation. For this, brands need to aggregate data and then use AI-ML to discern patterns to recommend the next best action to customers. Data today is collected from actions done by customers on the brand’s communications (push messages) and properties (website and app). A trick that marketers have missed is the simplest one: asking customers directly. To make the collection of zero-party data (data volunteered by customers), two building blocks are needed: a hotline to ensure customers are paying attention and not ignoring incoming brand messages, and incentivises which reward them for their data. Data-driven thus means incentive-driven, asking the user to self-reveal both because subsequent interactions will become more targeted and because of the rewards earned in return…While [marketers] can decode actions of individual customers on the website and app, the better approach is to simply ask customers and incentivise their actions (in this case, the data being provided voluntarily). How many brands ask us? How many brands offer us incentives for giving information about ourselves? In this case, the additional benefit is that we will also benefit from the personalisation in the offers that we receive. We want to be shown opportunities that interest us, that speak to us. Revealing ourselves is both an opportunity to earn points and to ensure future communications are targeted for our particular tastes.”

2023 will be the year when personalisation fulfils its true promise and potential – powered by zero-party data collection in interactive and incentivised emails.

Thinks 757

WaPo: “Book lovers are known to practice semi-hoardish and anthropomorphic tendencies. They keep too many books for too long, despite dust, dirt, mold, cracked spines, torn dust jackets, warped pages, coffee stains and the daunting reality that most will never be reread. Age rarely enriches a book.“Nobody likes to throw a book away. Nobody likes to see it go into a bin,” says Michael Powell of Powell’s Books in Portland, Ore…“We don’t want them to die. I love them. They’re a part of me,” says author and Georgetown linguistics professor Deborah Tannen, 77. She has books in almost every room of her Virginia home, long ago exhausting shelf space…“Books represent a significant investment of time and intellectual effort in our lives,” Powell says. “They’re more like friends than objects. You’ve had a lot of conversations with the book. You want to remember the experience. They’re echoes of what you’ve read.””

NYTimes picks the 4 best strategy board games of 2022: Root, Brass: Birmingham, Ark Nova, and Lost Ruins of Arnak. “Modern tabletop games are wonders of design and narrative, running the gamut from cooperative dice-rolling adventures to elaborate setups that allow for tense negotiation over resources. But sometimes you want to walk away from the table knowing that your carefully considered decisions (not fickle chance or fast-talking negotiation) are what led you to sweet victory (or, more often than I care to admit, crushing defeat). This is where strategy games shine.”

The Generalist: “Even excluding its aptitude for delivering insults, Twitter has begun to feel like an increasing mental strain. Though it is useful for The Generalist’s distribution, I don’t enjoy it. Indeed, usage seems to be negatively correlated with many qualities I’d like to cultivate over my life: focus, nuance, civility, equanimity, and depth. After observing and engaging on the platform for the past few years, I believe it primarily rewards facile controversy, reposted content, and the lowest-common-denominator thinking. Very rarely do conversations of any depth break out; if they do, it is by accident. John F. Kennedy once said, “Show me a man with a great golf game, and I’ll show you a man who has been neglecting something.” The modern adaptation of that sentiment might be, “Show me a person with a large Twitter following, and I’ll show you a person who has been neglecting something.””

Michael Tanner at Cato: “The U.S. welfare system is enormous, with roughly 134 different programs and costing more than $1.8 trillion per year. While it has done a reasonably good job of reducing material deprivation, in effect making poverty a little less miserable, it has done a remarkably poor job of equipping families to escape poverty altogether. Truly improving the lives of the poor is not a question of spending slightly more or less money, tinkering with the number of hours mandated under work requirements, or rooting out fraud, waste, and abuse. We need a new debate, one that moves beyond our current approach to fighting poverty to focus on what works rather than noble sentiments or good intentions—a system built on work, individual empowerment, and Americans’ philanthropic impulse. That would be a system that enables more low‐​income Americans to leave welfare for self‐​supporting work.”

Cato on Turkey: “…All the concerns about “illiberal democracy” [are] quite right. The latter is a simply electoral democracy that is devoid of political liberalism—with pillars such as freedom of speech, rule of law, and judicial independence. Without such guardrails, democracy can simply devolve into the tyranny of the majority, embodied in the whimsical rule of a strongman.”

Martech in 2023 will be the Year of 4PO (Part 7)

Personalisation – 1

As customers, we love content and experiences curated just for us.  And yet, there is a big gap in what brands offer. What’s missing is the data and analytics which are at the heart of crafting unique experiences for every customer.

Brian Carlson (CDP.com): “Data-driven marketers will embrace data and analytics as a foundational step to identify opportunities and create operational efficiencies. They examine the full customer lifecycle, focusing on areas where the most value is found. Data-driven marketers also leverage customer segments and microsegments, and will factor in data like behavioral, transactional, and engagement trends into their strategy… Personalization-ready marketers will invest in technology solutions that have activation capabilities and advanced analytics. Data-driven marketers should plan to develop scalable content and AI-driven functionality so they can respond to customers’ needs in real time.”

Blake Morgan (Forbes): “The shopping experience of the future will be personalized and technology-driven. Customers will be able to see items instantly, try them on and test them virtually, and have them customized to their exact preferences. The shopping experience will seamlessly move between the physical and digital worlds to give customers exactly what they want when they want it… Technology will be everywhere and make it possible for companies to automate the mundane parts of customer experience while also increasing and scaling their personalization efforts. It will be a fine balance between the two sides: customers want technology to make the experience smoother and more convenient, but they also want personalization. Companies will have to find the balance between automating and innovating with technology like AI, VR and connected IoT devices while also adding a human touch.”

Esat Artug (Ninetailed): “Personalized experiences are becoming an important part of the customer journey in this fast-paced change. Brands that successfully meet personalization demands will be handsomely rewarded with increased loyalty and greater revenue in the years ahead. Because the more consumers interact with a company in a more personalized way, the more likely they are to buy from that company again…Investing in customer data and analytics foundations will give businesses the ability to collect, cleanse, and unify data from various sources. This will provide a complete view of the customer journey, which is essential for personalization. Additionally, businesses need to be able to quickly process this data and create actionable insights in order to make real-time decisions. Building up agile capabilities will allow businesses to move quickly and efficiently to implement these decisions.”

Data is central to personalisation. While much of the focus has been on what marketers can glean about their customers using first-party data, I think 2023 will herald a big shift towards zero-party data.

Thinks 756

Mohit Satyanand on Bihar: “When 70% of a state’s population depend on agriculture, they are locked in a cycle of tiny, fragmented holdings, low levels of capital and technology, and low productivity. Migration of unskilled labour to the rest of the nation is not a viable route to prosperity for 130 million people. The state needs to attract industry and modern services, if it is to stand a chance of catching up even with its neighbours, West Bengal and Uttar Pradesh.”

Emily Balcetis: “What is your personal commitment to this goal? And if it feels low to you, then looking backwards, you might be motivated in that middle ground. But if it is something that you’ve always wanted to do, you’re passionate about, and you’ve already shown interest, looking forward might be a source of motivation.”

Economist on paper: “Technology can close the gap between paper and screen, but not entirely. Typing will never be as distinctive as handwriting. Doodling on a phone is just not as satisfying. And some of the attractions of the analogue become even clearer as digital technology becomes more pervasive and powerful. Catalogues do not have to be checked for viruses (however obsessively people wiped them down in the early days of covid-19). As machines get better at generating text, more exams and interview tests may be conducted with pen and paper, just to be sure. Mastery of digital technologies is vital. But a sense of touch, authenticity and humanity still matter—and not just on paper.”

ThePrint: “In arguing your ideas, rather than reflecting on them, you’ll meet challenges to your thinking and formulate responses. And the agility you’ll develop can spur you into stronger ideas. Dialectic done right, [Dr. Mitchell] Green says, helps you hone your position. Rather than thinking in, you talk out—and get real-time feedback on how you construct your ideas. In that, you can learn not only what you think, but also how you think.”

Donald Boudreaux: “One of the finest yet most-underappreciated features of the free market is its ability to discover and correct errors. Errors are unavoidable. Resources are used wastefully here and suboptimally there. Some people in some capacities are poorly informed. Particular workers are underpaid while others are overpaid. Today this employer has ‘excessive’ bargaining power, as does that seller of widgets. But nearly all of these errors are profit opportunities. Alert and creative entrepreneurs earn profits if and when they successfully ‘correct’ market errors. Underpaid workers, for example, are like $100 bills lying on the sidewalk. Ditto for consumers buying overpriced outputs. Because market participants spend their own money, they confront powerful incentives not to err and, no less importantly, both to be on the alert for their errors and to correct their errors ASAP. The market punishes strongly the throwing of good money after bad. The market also, because it typically features simultaneous ‘experiments’ – that is, different firms simultaneously trying their hands at satisfying the same consumer demands or ‘solving’ the same ‘problems’ – readily exposes those particular activities that work best.”

Martech in 2023 will be the Year of 4PO (Part 6)

Profitability

With easy financing drying, profitability is the key driver for businesses. Marketers have so far not been burdened with driving profitable growth – their task has been to grow the topline. Most have taken the easy path of pouring money on new customer acquisition via Big Adtech. As consumer spending slows in 2023 due to the twin effects of rising inflation and interest rates, CEOs will expect their CMOs to think and act like CPOs (chief profitability officers). For this, marketers cannot just optimise ad spending or try and improve customer experience on the brand’s owned properties (website and app); they will need to look at the elephant room in the room – the 50% AdWaste in their marketing budgets which is the root cause of diminished profitability or rising losses.

AdWaste is happening on account of wrong acquisition and reacquisition. The former is about paying Big Adtech for a user who does not transact or uninstalls the app within days; the latter is about paying Big Adtech for remarketing to an existing customer who has become inactive and thus not responding to the brand’s communications. The top imperative for marketers in 2023 will be to identify this wasted spending and eliminate it – without impacting revenue growth.

Marketers need to begin by answering two questions:

MSR today for most brands is 10-15%. Earned Growth is probably negative. The objective needs to be to get both to 50% or higher. (Sidenote: for a discussion on Earned Growth, see Net Promoter 3.0.) Think of the sum of MSR and EG as the FAB (Free Ad Budgets) Score. The path to profitability needs a FAB Score of 100 or more. There are two tracks marketers need to push profitability: build hotlines using Email 2.0 and Loyalty 2.0, and improve experiences on their digital properties with a unified Martech 2.0 stack and create differentiation for Best customers with Velvet Rope Marketing. [For a longer discussion, see Digital Marketing and its Discontents and Disruptions.)  As I wrote in the essay: “Start by addressing the crux of the brand-customer relationship with Email 2.0 hotlines and move the conversion ever closer to customers. Loyalty 2.0 gamification tokens give marketers the ability to engineer shifts in user behaviour by redirecting the AdWaste spending towards Atomic Rewards. Martech 2.0’s unified stack ensures that the incoming traffic to the brand’s properties has a personalised experience high on relevance. A focus on Best Customers (for acquisition and retention) reduces AdWaste and increases revenues. Together, these innovations can double brand profits without an increase in marketing expenses.”

For many B2C/D2C brands, profitability had become an afterthought. This will change in 2023 with pressures from investors and consumers. The solution lies in looking onward to the AdWaste and then using obliquity to solve the problem by focusing not just at the extreme ends (ad spending optimisation and martech consolidation) but in the middle – converting 1-way push channels into 2-way hotlines. An E2L2 (Email 2.0 and Loyalty 2.0) implementation is the first step in the journey towards exponential forever profitable growth.

Thinks 755

WSJ: “Researchers found that Chinese subsidies may be vulnerable to special-interest politics and went to favored groups or to stabilize employment or industries in decline. “At the aggregate level,” the authors write, “subsidies seem to be allocated to less productive firms, and the relative productivity of firms’ receiving these subsidies appears to decline further after disbursement.” Talk about myth busting. This should quell anxiety that Beijing’s state-directed allocation of capital is working for China, much less is a model for anyone else.”

Eric Ashman: “Here are three questions to ask when evaluating the potential of a new product or service: Will your early adopters accelerate organic growth? Are your customers coming back for more? Do you have enough pricing power to deliver profitability?…. Building a culture of innovation isn’t easy. It requires an acceptance of failure, supported by a culture of measurement and accountability. But it’s a powerful force for finding product-market fit, profitability scaling your startup and building enterprise value. It’s also a much more fun and fulfilling way to build your company. ”

Theodore Roosevelt: “It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”

Kyle Harrison: “Founders will continue to get bundled as larger firms start thinking about their portfolios as “asset exposure,” rather than individual company journeys. Ask a founder, who raised at a hefty valuation, what their VCs are doing for them right now. The good ones are helping figure out the process of battening down the hatches, and growing their business more thoughtfully. But a lot of them? Disappearing. The “asset” is underwater, and they’re better off spending their time with assets whose price isn’t as miscalculated. As the aggregation of assets in venture continues, there will be pros and cons. Some of the value-add of different venture firms is made possible because they become a center of gravity, and that’s powerful. But for founders, it’s important to understand the business model of these larger firms and how much or how little your company’s outcome may move the needle for them, and therefore how motivated they are for you.”

Chris Nassetta, CEO of Hilton: “In the room, the biggest changes you’ll see will be just getting the basics right and technology. You would laugh at the things that we talk about because you’d say: Of course, Chris, everybody cares about this stuff. But getting it right all the time makes a difference. What are the things that people care about? A great bed. Great linens. Great lighting. Plugs by my bed. A great TV with great content. Great bathrooms, space on the counter, a great lighted mirror. Water pressure and hot water. And great towels. Don’t give me sandpaper—I’ve stayed in some of our competitors…I have a philosophy in life, and that is keeping a steady hand on the wheel. Have a plan and work the plan and adapt the plan. The plan needs to change. Let me use driving vernacular. I don’t take every exit, but I will change lanes and I will take exits that really make sense. My longevity has been the ability to just sort of filter noise out and know when to take an exit occasionally, when to change lanes, but not doing it so often that everyone around you is rattled and they can’t see what tomorrow is going to be.”

Martech in 2023 will be the Year of 4PO (Part 5)

My Writings

Solving the $200 Billion AdWaste Problem: “Brands spend $400 billion a year on digital advertising. Most of this is spent on new customer acquisition. The biggest beneficiaries of the advertising spend are the Big AdTech firms like Google and Meta, and increasingly Amazon and Tiktok. Brands are in a competitive race to acquire new customers and Big AdTech acts as the gatekeepers to digital customers. Attention is auctioned as clicks cost increasingly more each year. For many brands, the CAC (customer acquisition cost) has been rising 40-50% annually. And yet, brands feel they have little or no choice but to continue spending because they have few alternatives to reach out to new digital customers. The result: brand profits are taking a hit, and Big AdTech amasses even more power with their profits…For martech companies, the $200 billion AdWaste can become the new pool of money which multiplies their TAM (total addressable market). Today, most martech companies play in the 10% spending pool (about $50 billion). Newer solutions can substantially expand the available market. But to do this, it is not about adding new features to the martech stack but about taking a very different approach with a fundamentally new insight: attention and data are upstream of transactions, and “Atomic Rewards” (micro-incentives) can help marketers get more attention and data. In other words, persuade marketers to pay their existing customers rather than Big AdTech.”

Digital Marketing and its Discontents and Disruptions: “Digital Marketing too is facing threats from two sides: new customer acquisition and existing customer retention. CAC (customer acquisition cost) has been rising rapidly while competition for a brand’s existing customers combined with attention recession is forcing marketers to offer discounts and coupons to lure them back. Both are hurting profitability and creating angst amongst business leaders: how to ensure continuing growth amidst these twin challenges of increasing costs and decreasing loyalty? … Digital marketing needs a disruption…This is marketing’s future. Earned Growth (a metric based on revenue growth from existing customers and new customers coming in via referrals) should be the North Star Metric for marketers. Email 2.0, Loyalty 2.0, Martech and Velvet Rope Marketing 2.0 are the four horsemen to lead marketers into this new world of exponential forever profitable growth.”

Even as marketers need to shift spending from adtech to martech, they also need to migrate from Martech 1.0 and Martech 2.0. Here is a chart that outlines the transition they need to do:

It is with this background that I think of 4PO – profitability, personalisation, predictions, progency and omnichannel – as the defining trend for martech in 2023. Profitability can only come about with the elimination of AdWaste, personalisation needs data, predictions will be driven by AI, progency combines product with agency-like services, and omnichannel is the hallmark of today’s customer.

Thinks 754

: “Obliquity flashed in my mind as I read the book, Afterness, by former Hindustan Unilever chief Ashok Ganguly, though the book has no allusion to that term. Dr Ganguly states that he never dreamt of becoming a scientist, he never targeted how to rise in his corporate career, and he did not aim to serve as a scientific advisor to the Prime Minister. Yet, all these things happened in his life. He hints that if we focus diligently on doing what we need to do in our jobs, somebody else will manage our career and progress. It could be that the employer company takes care, or that Lady Luck or God will be watchful. After we have run the course of our careers, the wisdom of obliquity dawns on us. Psephologists and economists realise how wrong their prediction models were, business leaders realise how misguided they were about the centrality of their own role in achievements, and politicians realise how much froth and blah they had deployed to seduce their voters. Professor Kay says that obliquity “describes the process of achieving complex objectives indirectly…. happiness is where you find it, not where you go in search of it.””

: “India’s governance structure…allows very little room for local governments like the municipal corporations. As a result, the third tier of governance (the first two being the Centre and the state governments) has grossly inadequate powers of raising resources to fulfil its basic responsibilities. Worse, most of these municipal corporations do not even show much interest in using their existing powers to tap into new sources of revenue to fund the schemes that they must run for the upkeep of the municipalities. Two consequences follow. One, the performance of municipal corporations suffers hugely. They are often short of funds to even pay salaries to the staff at the many agencies and organisations they run to provide basic services to people like primary education, health and sanitation. The second consequence is worse. These corporations become more dependent on financial allocations from the state governments. If the allocations dry up, the corporations fail to discharge their basic functions. And if the municipal corporation is ruled by a political party other than that running the state government, the financial consequences are serious.”

Hayek: “Unless we are willing to restrict the powers of government even in respects where it might be used for good purposes, we shall not succeed in preventing an indefinite growth of government powers. To allow everything which seems expedient for the achievement of a desirable end is to dispense with all moral principles. The submission to rules which must be observed irrespective of whether in the particular instance their infringement is harmful or not, is the main condition for the possibility of order in a free society. And to these rules the state should be no less subject than the individual.” [via CafeHayek]

Tim Martinez: “Larry Greiner’s Growth Model states that each new level of “growth” creates a new crisis which he identified as: Crisis of Leadership – moving from start up mentality to a more well defined management style. Crisis of Autonomy – management becomes siloed and more interested in the business unit vs the whole. Crisis of Control – Owner/Operators find it difficult the relinquish control. Crisis of Red Tape – Bureaucracy, excess of reports, broken systems, etc slow growth. Crisis of Growth – how to continue growing as a mature, successful company?”

Siddhartha Mukherjee: “Being able to manipulate that basic unit of pathology becomes vitally important as we move forward because it allows us to manipulate, not at an organ level, but at the level of what constitutes the organ. Take CAR-T cells [chimeric antigen receptor T cells used in cancer treatment]. If you’re making a CAR-T cell, you’re extracting a vital part of the immune system, changing it using gene therapy, and then returning that same cell into the body so that it can perform a function. In the past it would be unimaginable because you would have no mechanism really to grow these cells outside the body, to change their parameters, and then return them to the body, and treat a disease like cancer, using this level of cellular manipulation.”