The Future of Marketing ft. Mathew Sweezey | Salesforce

Good morning, my name is Elodie Barbera and I'm one of the business consultants at Salesforce Apac. Before I start, I have a quick message from our legal department. During this presentation we may have some forward looking statements. So what we ask you is to make your purchasing based on what is available today. So here at Salesforce, Word tool innovation and defining the future of connected customer experiences is in our DNA. So I'm truly delighted to welcome today Matthew Swizzy who is regarded as one of the leading mind on the future of marketing. Matthew is our principal of marketing insights at Salesforce and he's also an acclaimed author. His latest book the Context Marketing Revolution has just been published with Harvard Business Press and you are lucky today there will be a link at the end of this presentation where you can enter your contact details to request a copy. So stay with us until the end of the session. Matthew, visionary insight into consumer behaviors. Media technology and business strategies have changed the way that startups, but also Fortune 500 companies and not for profit organizations have shaped and found new customers and built modern brands. So let me ask you a question. Considering that we live in the world of infinite media and content is nowadays a new commodity, have you ever wondered as a marketer how to make your content stand out from the pack? Well today Matthew is going to share the magic harvested from 11,000 brands and revealing for the first time the idea of context based marketing adopted by brand like Adidas, Lego and Tesla. And he will also share with you some insight on what you will need to change to break through with your customers. With that I would like to welcome Matthew. Matthew, welcome. Great to have you here. Over to you.

Thank you Elodie. Hi everyone, thank you so much for joining us. Now I'd like to start with just a little bit of information about a little bit more what about I do. So I help run, analyze a lot of our data, help some of our research and really try to find the differences between high performing marketing organizations and everyone else. And when we start talking about the future, I do want to start with one quote and this is a quote from one of my favorite authors, William Gibson. Now this is the man that coined the term cyberspace and what he said. He says the future is already here, it's just not equally distributed. Now why would I start with this quote? Well why I do is because we need to realize there are multiple different futures. There's a far off future that we will all have. But for many of us there is a very near term future and what we need to think about is what are high performing marketing organizations already doing and when we start to look at this, what we find and we've done lots and lots of research over the past five years looking at over about 20,000 brands from across the globe. And what we've been able to identify are the key differences between high performing marketing organizations and everyone else. And what we've really found is there's only about 16% of all brands are high performing marketing organizations. So I'm going to share with you some of the insights of what makes a high performer and that is our near term future. Now, in addition to that, we'll also share what is the far term future a little bit farther out of some things that we need to think about and how we need to be able to break through and in the modern time. Now to start, I really want us to focus on the modern consumer and we really must always start with the customer. So I want us to think about something really quickly. Now, artificial intelligence. It's a conversation we've been having for a while and often when we think about artificial intelligence, we think about it from a business side. How can I as a business use artificial intelligence to better enable my processes, better enable my product, make better decisions? One thing we fail to think about is how artificial intelligence has already changed the consumer. Now I want you to really think about this. Any medium that an individual interacts with on a daily basis now is empowered by artificial intelligence. And in what I call this is the post AI consumer. Now this is very critical because if we don't understand this, we won't understand the modern consumer demands. Because now every interaction they have is specifically curated for them by artificial intelligence. And if you think about any digital medium that we utilize now from email, all of our email inboxes are filtered by artificial intelligence. Every search result that you ask, everyone in the world can ask the same question, but we all are given a different answer. And that answer is curated for us by artificial intelligence. And it's focused on the context of the moment. That's why it's different for each of us and we can look at each one of these different mediums. Social is a great example. When social media first came out, if you looked at a social media feed, it was a chronological feed of content, meaning everyone in your audience. What they published you would see in a timely order. But now what we found is in the world of infinite media, there is simply too much media for that to be possible. In fact, the statistic is that every time you log on to Facebook. There are thousands of posts waiting for you, and you will only see a tiny fraction of them. Now, think about this very critically and look at the timestamp on each one of those posts that you see. They are not in chronological order. They are in contextual order. Remember, the artificial intelligence is only going to serve up in context of what it thinks the person is going to engage with. And this continues across every medium that we look at. Now, if we want to go forward, looking up to 20, 25, what we expect is that 95% of all interactions between a consumer and a brand will happen via artificial intelligence. And this is very critical because we must understand what that AI is optimizing for and who it is optimizing for. And this is what the modern consumer demands. In fact, when we look at modern consumers, we have asked this question to thousands of customers. And what we found is 84% of customers say that the experience a company creates is just as important as the product or service that they sell. Now, this is a radical new idea that we must understand. And this means the experience is now a product that the business must focus on just as much as they focused on the physical product and the delivery of that product with service. Now, I talk about this all over the world, and I get a lot of pushback from businesses and from executives and from. And this may be something you've gotten pushed back onto before. And the pushback usually comes in one of two ways. It usually comes in, oh, that's a millennial thing. This doesn't affect my buyer. My buyer is a baby boomer. They're old. They're an old dog. They can't learn new tricks. That's actually false. And why it's false is because we all live in the same environment, and we are all affected and changed by media in the same ways. In fact, what we find is there's only a 12% delta between what a baby boomer and what a millennial expects. Now, they expect that experience to be delivered on different channels, yes, but they expect the same experience regardless of age. Now, the other aspect of this is people say, well, that is only for business to consumers. That only happens with consumer product goods. And that's also false as well. What we find is the B2B buyer is more affected than the B2C buyer. In fact, when we look at over a hundred questions, what we find is, will technology change the way that you buy? Will it change your expectations? And B2B buyers are more affected than their B2C counterparts. Now, why is this the case, it's a very simple reason, because there is more risk in a B2B decision. So they will do more things to mitigate that risk and rely greater on technology to solve those problems. So how has this really changed some of the big fundamental aspects that we need to think about from marketing? Well, one is, I want to share this example with you. What you see on the screen behind you is this is a wall of toothbrushes. Now, traditionally we would think this is a very simple purchase. We would consider this a non considered purchase, an impulse buy, you may say. But what we found is something radically different. Because now that the consumer lives in a world of infinite content, they have a different decision making process. Remember, there is risk in any decision and a consumer will always optimize to mitigate that risk. So just think about this scenario. You're standing in front of a wall of products and you need to make a decision. How do you do that? Well, one, you could pick up every product, read the packaging and decide if this is something that you want to buy, put it back on the shelf and continue through. But that takes a long time. And then the other aspect is those are messages from brands and those messages are not as nearly as trusted as other answers from other consumers. So actually what we find is the following. The search term for best toothbrush is growing at a rate of 100% year over year because it's so much easier for the consumer to pull their phone out of their pocket and simply ask best toothbrush, and within 0.3 seconds receive dozens of trusted answers. And now what we find most surprising about this action is that it's a journey to buy a toothbrush. And in fact, it lasts 70 seconds and goes across four different websites. Now, all purchases are considered purchases. And we must really understand this because that really changes the very fundamental idea of what marketing is for an organization and how we break through and motivate modern consumers. Let's move forward and talk about if that is what we must do. How do we then creatively do this? Well, we must focus on contextual experiences. Now, if you've read any of the latest research on experiences, you know there is a massive gap between what businesses believe they are creating and what consumers are actually experiencing. In fact, research from Bain shows There is a 72% delta between the experience gap, meaning 80% of businesses believe they are creating a great experience, but only 8% of their consumers would agree that they are being delivered a great experience. So what are some of the problems and how can we solve this. Well, once again let's look to high performers and what we find is the number one key trait of a high performer is they have executive buy in to a new idea of marketing. They don't just simply adopt old ideas and just new ways of doing the same old things. They have a radically new idea of marketing. And that's really a couple of basic things. First is they understand that the idea of marketing exists across the entire customer journey and that it is about experiences, not messages. And they have shifted the definition of marketing to become the owners and sustainers of all experiences across the customer journey. That is the number one key trait of a high performing marketing organization. And we start to break this down, what we can see is a lot of fascinating things. In fact, when we look at the experience once again, experience is not a new word, but we must realize is an experience must be contextual, meaning it must help a person achieve the goal of the moment. A good experience is not just one that's got great copy. It's not just one that is catchy and has a great ad behind it. It's one that helps somebody accomplish their goal at the moment. And once again, high performers do this across the entire customer journey. They collaborate. And this is another key trait of high performers that underperformers just aren't able to do. In fact, it's a staggering difference. High performers are 17 times more likely to be able to create a cohesive customer experience and collaborate across the entire customer journey. Now let's look at a very specific use case of this. And it's simply service, right? We often don't think about marketing and service being combined, but they must be combined because it's a very simple problem. You should not market to somebody if they are unhappy with you at this moment. It's a very bad experience. And what we find is only 1/3 of businesses currently can suppress a marketing message to somebody in their support queue. Once again, high performers collaborate and we must break down the silos across the organization and understand every silo must be connected and they must be connected to create a cohesive customer experience. Let's look at a great case study. Craveable Brands has been able to do this. I just want to read this quote. It's a phenomenal thing. We want our brands to be Australia's best known and most loved restaurant brand. The customer experience across all channels is vital, not just in store. And then when you look at the results that they've been able to achieve with this direction, 600% increase in traffic, 40% increase in loyalty. It is a powerful driver. It is not how creative we can be, it is how contextual we can be across the entire customer journey. And this really changes the very definition that we think of as brand. It's not what we say. It's not the imagery that we produce. It's the sum of all experiences that we create that is how we build the modern brand. Now, this also then changes a lot of organizational structures and how we think about creating these experiences. In fact, we find there is a new executive in charge of marketing. Now, there's a lot of different ways that we can classify this. There's the Chief Executive Officer and under them there is the Chief Experience Officer or the Chief Growth Officer. Both of those, CXO and cgo, they have the same focus and same goal. Remember the old adage, if it's not measured, it can't be improved. And if the organization doesn't see growth as a holistic measure about creating experiences across the customer journey, they will not be able to grow. And that's why we've seen so many companies put a Chief Experience Officer or a Chief Growth Officer in place. Virgin Atlantic, asos, qbe. We see this happening across every vertical and every industry. And I want to bring your attention to publicists, and they're the one under the media campaign. They're one of the largest media and advertising conglomerates in the world. They themselves have put a Chief Experience Officer in charge of their marketing. If they are doing that, we should look at that as a cue about we should be doing that as well. Remember, they're running a lot of marketing for a lot of major brands. The question then becomes, what is the role of this individual? And Diane, she is the CEO at the Customer Experience Professional Association. She sums this up very succinctly and very well. They simply just must be a bridge builder between experiences across the journey. That's simply it. They must bridge all of the different silos together. Now, to create this cohesive customer experience, we all understand there is a requirement, there's a fundamental thing we must have and that is data. So let's talk about data and the future of data for just a second. Now, what we've been able to find is data is not just there, it is growing. And it is growing at a rapid rate. In fact, what we find is the average brand currently uses 15 different tools. Excuse me, they use 15 different data sources and on average use 39 different tools across the entire customer journey to manage a single customer. Now, that data is also growing at a 20% annual growth rate. And we project by 2025, the average brand will be using 45 different data sources. Now, if you think about this, 45 different data sources, 39 different tools, that is a major problem that we have to solve. It's a problem that I call the identity crisis. Because each one of those data sources uses a different unique identifier. Some data sources may know you as your first name. Some may know you as an email. Some may know you as a hash or a cookie. We must be able to connect all of that data together to know a single person at a single moment. If we can't solve that first, it will be very difficult for us to create a cohesive customer experience, or in better terms, an Omni channel journey. Now, here's what some of the high performers are using, and here's how they're able to solve some of those problems. Here's a couple of basic technologies that you can think about and how we can see how they're being deployed across the different landscapes of high performers. AP stands for average performer. UP stands for underperformer, and HP stands for high performer. Now, you can use this to benchmark yourself to see where you may fall in this high performer or average performer, and where your next steps may lie. Now, once we've been able to solve this, let's talk about something that's a little bit farther afield. And this is something on everybody's mind. How is voice going to change marketing in the future? And let's be very clear, right? So I have a very different idea of voice. So let's kind of start with the basics. So first off, the basic statistics, 38% of all consumers have used voice. We all have voice. I believe Google says there are 2 billion Google enabled voice devices in the marketplace. As of this year, there's only 7 billion humans on the planet. Now, if you use voice, it then becomes a daily habit. And what we find is 72% of consumers who use voice, it then becomes a daily habit. Now, where do we see this thing going far out in the Future? Well, by 2025, we should expect that 1/8th of all people on the planet will be using a virtual digital assistant. They will be asking them questions. If you have not seen the Google Duplex demonstration, I highly suggest after this, you watch the Google Duplex demonstration. For many of us, we believe it's the first passing of the Turing Test. That means that it's an interaction between a human and a computer, and the human is unable to decipher that they are talking to a computer and, and believe they are talking to another human. This is a major step in the history of the world. Now, here's where I really think we need to be focusing on with voice. It's not just that voice we need to be thinking about. How are they going to be asking questions? We need to see this as a new interface for the future of the world. I want you to think about Bill Gates. Why is Bill Gates so rich? Right. You're going to say Microsoft, but there's three letters. I want you to think about Graphical user interface. Gui. Before Bill Gates and before Microsoft, we used DOS commands. There was a green screen, and we had to physically type in command codes to interface with technology. What Bill Gates did was say, hey, let's use a visual interface, a graphical interface to interface with technology. Now with voice, this gives us a new interface, a conversational interface. Now, if we just think about conversational interfaces and we just think about a basic concept of business, of let's just stop doing things our customers hate. That is a really good business strategy. Now let's look at a very common thing that everyone hates. It's a form. All businesses use forms. But I want you to think about who the form serves. The form does not serve the individual. I have never met a human that said, man, that form was the best thing I've done today. We just don't say that we hate forms. What they do is they simply allow a business to get data to be input into a database in a specific order. That's it. But now, how can we reimagine this in a conversational world? Well, we start to think about chatbots. And when I talk about chatbots, once again, I must remind everybody this is not a millennial thing. This is not just a consumer thing. In fact, when we do the research, we find that baby boomers and five of the six top use cases are more bullish on chatbots than millennials. They believe them to be better at helping them get instant answers, helping them get complex answers. And so what we see is now we see marketing examples such as Lego. Remember, talked about context. How do we help somebody accomplish the goal? At the moment, what LEGO was able to do is they created a chatbot. The problem was people didn't know which LEGO set they wanted to buy. There are so many different LEGO sets. So they invited people into a conversation on Facebook with Facebook messenger, and that chatbot was named Ralph. Now, here's the phenomenal statistics. The average conversation with Ralph, the chatbot that helped Them pick the best gift for their buyer. The average conversation was three minutes. The average order size was twice the average order size on the website. And this Chatbot accounted for 25% of all online holiday sales in 2017. Remember context, helping them solve the goal of the moment. The problem was they didn't know what was the perfect gift. Traditional marketing logic would say, all we need to deploy is a retargeting campaign and show them the products that they've looked at. But remember, the creative lens of the future is context. That is what we must focus on. And we see conversational interfaces working in every vertical because it is a better way for a human to interface with technology. Just think about your bank. For me, it takes seven clicks to pay a bill on my bank. A conversational interface. I could simply say, please pay this individual and how much? And it is taken care of. Zero clicks, zero friction. Remember, easy is better. Let's stop doing things customers hate and make it simpler for them. Now, if you want to project this far out, what we should imagine is the very concepts that we have of websites. How we build them, how they operate, how consumers want to engage with them will be radically different in five years. There are now businesses that are completely starting up, that don't even have websites. They simply are just bots operating inside of messaging applications. Now with this, we also must think about a new idea of direct marketing. And I want to move through this somewhat quickly. Right when we started in the world, we really had this idea. In the very far off analog world, there was this idea of one to many. We would create one message and make it as cool as we could make it and ship it out to as many people. That was how we got the reach and the power of our marketing. We then moved into a world that was now digital. And we could do one message to one person at one time. But I want you to ask a question. I want you to think about this. What is the highest value of the Internet? It is not free publication. It is in fact, direct human connection. And this is why we see so many new marketing methodologies. Influencer marketing, advocacy, employee advocacy, social media. This is human to human. We must find ways to connect humans together. And when we can, they help us solve major business problems. One of those problems is how will we create enough content in this world of infinite media to stay relevant? Well, what we find is organizations like Daniel Wellington. They're a startup watch brand who now sells $100 million of watches a year. What I find so surprising about this is 99.5% of all the content that lives online about Daniel Wellington is created by their audience and by their marketplace. They have found a way to connect humans together to create content for them so they, as an organization, don't have to do it. We can also find other ways to connect humans. This is backcountry. This is a retailing site. And what they've been able to do is use humans and technology to connect humans together. I found out about Backcountry because I bought a pair of socks and a pair of gloves for a snowboarding trip. I then received a call from Wesley. Wesley is my gearhead and he wants to understand what am I doing, where am I going, and give me tips for my trip. This is a retailer who now has a human reaching out to building personal relationships with me. And if you see the statistics on what they find, it is baffling. They find a 40% increase and a 105% increase in purchasing behavior, human to human is where we need to be going. Now I want to wrap this up with some conclusions and then we're going to bring Elodie back on and we're going to have a final question to discuss. So first off, what we must realize. There are 600 million devices in the world currently with ad blocking. This is the largest consumer boycott in the history of the world. We must understand what they are boycotting and how we must survive and move forward. And when we see this world of infinite media and how it changes consumer behavior now all purchases are considered purchases. We must make sure that we are across that journey and we must make sure that that experience exists across the entire customer experience. And remember, this is not a millennial thing. This is not a consumer package. Good thing. This affects all people and all people equally because we are all living in the same world, in the same media environment. And that media environment operates on a new foundation. And that foundation is context. And we must look at this as the creative lens of marketing in the future. How can we help people accomplish their goal in the moment? And this really brings us to brand. Brand is the sum of all experiences that you create. And remember their number one key trait of high performers is they have executive buy in to a new idea of marketing, not just new marketing ideas. Right? And with this, we need a new leader, the cxo. And we also must strive to create human to human experiences as best as possible. And with that, I want to say thank you so much and I want to invite Elodie back up on stage.

Matt, thank you so much for Sharing these great insights. I would love to discuss with you further many of them. However, we are pressed with time, so I, I would love to ask you a closing question. So you said by 2025, 95% of all the interaction with consumers will happen via artificial intelligence. My question to you is, how do you foresee then the role of the CXO and the marketing team?

Great question. So we must understand the role of marketing is now expansive across the entire organization. And this is going to mean two very specific things. One, the marketing organization and the structure is going to change. We're going to see marketing become decentralized across the entire organization. We're going to start to see what I call the citizen marketer. And that means your service team, your support team, your sales team, your product team are going to have to play marketing roles. They're going to be enabled by artificial intelligence. The term citizen means an individual who is not a specialist in that field who is enabled by artificial intelligence to accomplish about 90% of the tasks of, of a specialized individual. So that is where we're going to see artificial intelligence and how marketing is going to change inside the organization moving forward. Now, I also would like to say, remember, we have also gone ahead and said, if you would like, we set up a landing page and you can go ahead and you can register and we will send you one of the books. We will get very deep into where you need to be thinking about in the future, how artificial intelligence is going to be changing us and where we need to be going. So with that, I want to say thank you so much for everyone for listening. Thank you and have a great day.

Thank you.

Thank you, Elodie.