The Rise of Clairvoyant Marketing

Data & Artificial Intelligence

A Marketing Evolution

For centuries, business advantage has been created by the ability to fulfill needs faster than one’s competitors. But soon, marketing strategies driven by rapid response—even real-time response—won’t be good enough.  

Welcome to the world of clairvoyant marketing, where soon, brands won’t wait even a microsecond for buyers to raise their hands. In this new, connected economy, customer-obsessed brands won’t be battling it out in the competitive landscape—they’ll be avoiding it altogether. 

In this piece from Razorfish, we explore how and why the real-time marketer is naturally evolving to the clairvoyant marketer, highlighting:

  • The rise and quick fall of real-time marketing
  • The emergence of clairvoyant marketing
  • Recommendations

The trend

As the economy becomes increasingly connected, several emerging technologies are joining to create an entirely new definition of “customer experience.” Consider these not-too-far-in-the-future scenarios: 

  • An Uber car pulls up to your door anticipatorily (because the system knows you’ve got a flight in two hours).
  • Your Nike+ app ships you a new pair of running shoes (because the app senses you’ve put too many miles on your existing pair).
  • Your Trunk Club app sees a friend’s wedding on your calendar (and automatically lets your stylist know you might be needing a new suit). 
  • Your vehicle automatically plots a traffic-free route home (knowing you’re likely headed there after a day at the office) and alerts you to the location of the nearest gas station (given the pending snowstorm). 

The transformation of sense and respond

When Jack Welch made his famous observation—that competitive advantage lies in the ability to respond to needs faster than competitors—he was looking through a 1980s lens and living in an era when concepts like smart machines and artificial intelligence resided exclusively in ivory towers and science fiction films.  

But then came the Nexus of Forces, which introduced social media, mobile platforms, big data and the cloud, and created a sort of electronic looking glass that today provides previously unimaginable visibility into the buyer’s context—one in which people share where they are, whom they are with and what they are doing. The breadth and depth of the information available to marketers today empowers them to make offers that are far more intelligent and relevant than ever before.

The rise of real-time marketing

The initial triangulation of keen buyer insight, informed by data from the cloud, social media and mobile platforms, launched a movement (albeit one not heralded by a great deal of thunder) known as “RTM,” or real-time marketing. RTM’s fundamental assumption was that deep analysis of past and present behavior, combined with such techniques as location awareness, would award a brand with the ability to respond faster than its competitors. 

Many times, this race to respond isn’t even necessarily won by the brand offering the superior product. In their eagerness to have their needs fulfilled instantly, buyers frequently show us just how much value they place on time and convenience. “Solve my problem, and solve it fast,” has become a common rallying cry of the digital customer (and especially of those who identify time poverty as one of life’s leading constraints).  

But now, “Solve my problem fast” is giving way to “Solve my problem before it ever even exists.” 

The quick fall of real-time marketing

It’s been said the best way to win the game is to not play the game. By changing the game’s fundamental rules or by altering—even crushing—the game’s working parameters, clever entrepreneurs in the connected economy joyfully watch established, century-old players lose market share to their disruptive, game-changing ideas. 

It’s this type of thinking that led Uber founders to respond to “I need a ride,” instead of “I need a taxi.”  Or Airbnb’s game changer, “I need a place to stay,” instead of “I need a hotel room.” Zocdoc makes doctors’ appointments that are cancelled at the last minute available to those willing to pay a premium for immediate care. In all these cases, entrepreneurs took a page from Clay Christensen’s jobs-to-be-done playbook: “Address the problem to be solved and nothing more,” using data (digitally visible for the first time) to form irresistible value propositions. 

But even these disruptive examples rest on the model of using rapid response as a primary differentiator.

Zocdoc Appointments.
Source: zocdoc.com

Getting at the Heart of Clairvoyant Marketing

Big data plays a role in the success of most, if not all, disruptive digital companies. By joining the customer insight derived from data with a compelling value proposition, new startups regularly reach billion-dollar valuations. But business models, as innovative as they have become, still overwhelmingly depend on an offer-acceptance paradigm in which the brand makes an offer and the potential customer then decides whether to consider and/or accept it.  

In clairvoyant marketing, however, the marketer either gets in front of the acceptance phase (as when your Trunk Club app alerts your stylist to the fact that you might need a new suit) or bypasses it altogether (as when the Uber car shows up unordered in anticipation of your flight). 

Behind clairvoyant marketing lies emerging technologies, many of which are rapidly maturing, that work together to obliterate the classic sense-and-respond model that has fueled business fundamentals for centuries. 

The datafication of location is a marketing breakthrough, but it’s only half the solution.

Circa 200 BCE, the Greeks came up with a grid system, which led to codification of longitude and latitude. But it wasn’t until 1978 that the next real breakthrough came—when a satellite interacting with ground receivers pioneered GPS, or global positioning system. Now, Wi-Fi routers and cell towers deliver even more accuracy, overcoming    the traditional challenges to GPS functionality that arise from being cloistered indoors or surrounded by tall buildings.  

Knowing your buyer’s location gives you a big advantage in determining how best to position your product. But that information by itself can’t fully inform your next best offer. For that, you need to marry location with context, which together create the magical ingredient for making clairvoyant offers: “The smart refrigerator you’ve been eyeing for the past few weeks is on sale at your neighborhood Best Buy.” When brands connect these types of dots, the result is an experience buyers find irresistible.

“One approach solves a problem after it has occurred; the other prevents the problem from happening in the first place.”

Today, Microsoft, Apple and Google now have their own geolocation systems to complement GPS and use them to track and analyze the ways in which people interact with objects. The level of insight gained from these tools will become more and more useful to clairvoyant marketers. For example, a customer’s vehicle might soon be able to inform him or her of an alternate insurance provider that, based on the customer’s driving behavior and profile, could save him or her $800 per year. Simply responding “yes” to the vehicle’s inquiry would allow the customer to terminate his or her current insurance contract and sign with the alternate provider. 

Today’s UPS drivers don’t wait to experience engine trouble. Thanks to similar “smart car” techniques, they avoid it altogether, simply by taking their vehicles in for service when the vehicles themselves signal that service is needed. UPS Process Management Director Jack Lewis says, “Prediction gives us knowledge. But after knowledge comes wisdom and clairvoyance. Soon, the system will correct problems before the driver ever realizes anything was even on the verge of starting to go wrong.” 

The role of wearable in ubiquitous commerce

Wearables pioneered by the health and fitness industry are already transmitting vital sign data automatically to clinicians that are used to inform treatment plans. Consider a future scenario in which your watch alerts you to a sale on protein bars after noting a protein deficiency in the nutritional analysis it performed on you the week before. Or perhaps your Basis, another fitness device, might note that you’re dehydrated and responds by directing you to a store that carries Gatorade. 

These symbiotic experiences are far more seamless, transparent and frictionless than the marketing model that has preceded them for centuries. While one brand might use intelligence to make an offer to a buyer in the moment he or she becomes aware of needing the product, a competitive brand may seize the marketing advantage by using wisdom to get in front of such awareness. One approach solves a problem after it has occurred; the other prevents the problem from happening in the first place.

The even bigger role of sensors 

By now, you’ve likely noticed that context is the clairvoyant marketer’s key to offering magical experiences. Sensors are often the enablers of this magic. Using sensors, your car knows if someone other than you is sitting in the driver’s seat and can be programmed to use this data for everything from automatically resetting the seat position to refusing to start. In this same vein, the smart fridge automatically reorders depleted stocks of orange juice and milk. A glowing cap on a prescription drug can alert its user to call in a refill order. Scores of sensor-enabled clairvoyant marketing examples are already filling the business journals. By enabling early detection and treatment of cardiac problems, sensors will soon prevent heart attacks to such an extent that tomorrow’s youth might even have to ask, “What’s a heart attack?”

The datafication of interactions and moods

If we can quantify context, why not quantify our relationships, moods or experiences? While this gets a bit more personal and sounds futuristic, social networks essentially already do this today, with the social graph. Twitter quantifies sentiment by letting people record and share thoughts and attitudes. LinkedIn practices clairvoyance whenever it suggests a job we might want or people we might know, or might want to know. In the future, brands will practice clairvoyance using rich data sets from social networks versus counting likes or tracking pictures on Instagram. 

Quantifying attitudes and sentiments for analysis extends to the individual datafication of human behavior as well. For example, the people an individual chooses to follow (as well as the people who follow him or her); the type of language he or she uses; his or her geolocation and the way it changes—all of this information informs clairvoyant marketing. Dr. Marcel Salathé, assistant professor of biology at Penn State University, can accurately predict a person’s likelihood of getting a flu shot simply by analyzing his or her tweets. 

Fitbit and Wearables for Nutrition and Health Industries.
Source: Fitbit

Clairvoyant Marketers Will Teach the Machine

IBM has said that the computers of the future will not be programmed; they will be taught. Machine learning is one of the keys to bringing clairvoyant marketing to life. Without it, humans can only envision so many combinations of data, context and need states. Business rules and if-then statements will only take things so far. Practitioners of clairvoyant marketing will take full advantage of machine learning—starting with automated A/B tests and dynamic optimization. From there, it will progress to teaching systems how to interpret and predict a person’s needs based on triangulating context derived from a wide variety of inputs. It may start with location but will move to incorporate the information sources described above, including wearables, external sensors, past behavior and more. Intelligent machines will run thousands of A/B tests to accurately interpret various signals and then determine the best message/experience and the most effective delivery mechanism.

Recommendations

Rethink sense and respond

Paradigms with the potential to supplant those that have been in place for decades, even centuries, are challenging to grasp, let alone embrace. But new technologies and techniques that make data digitally visible for the first time are creating game-changing opportunities. Predictive analytics informed by insight from location services, machine learning and IoT will give enlightened brands huge business advantages. Ignoring these trends for long will leave you irreparably behind.

Get clairvoyant technologies on your radar

Make sure your CIO and CMT (chief marketing technologist) are in tune with the trends and technologies that are disrupting the traditional sense-and-respond marketing model and that are likely to make rapid response, at least as we know it today, obsolete. Brands that get in front of the buyer’s unconscious decision-making process will outperform those that respond to conscious needs (even when they do it at lightning speeds). Though concepts like machine learning, wearables and the datafication of just about everything seem futuristic, this future is happening fast, and the implications for marketers are enormous. 

Be painstakingly clear about marketing strategy

The datafication of everything will paralyze marketers who try to translate the capabilities of technology into multiple strategies individually driven by data, social media, mobile platforms, wearables, the cloud, etc. Create one strategy, and then assess how technology can tactically help you implement it. Remember, your CEO cares far more about your customer acquisition and retention strategy than about the number of mind-numbing strategies modeled after the technology-du-jour.

Do whatever it takes to achieve and maintain a single organizational view of the customer

Breaking down organization silos will be essential to any brand’s ability to develop and succeed with this new style of marketing. You must know everything you can about a customer or prospect to orchestrate good anticipatory marketing. Organizational units that insist on owning a specific customer scenario will work inadvertently to compromise clairvoyant marketing. Only you can identify just where these organizational challenges lie. And in most cases, your evaluation of your people will require adjustments. 

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