go-Digital Blog on Digital Marketing

Excerpted with commentary, from the Original Article: In-Situ Marketing, September 29, 2007 by Augustine Fou

The word “in-situ” comes from my days in the chemistry lab working towards my PhD where the best observations were made “in-situ” — i.e. while the experiment was still running. The official dictionary definition of “in-situ” is “in the natural, original, or appropriate position.” Applying it to marketing, I mean “observing customers’ behaviors in real-time and optimizing marketing based on these insights.” Segmentation, surveys, focus groups, etc. are not “in-situ” because asking the questions in a particular way impacts the outcomes or the answers have built-in assumptions, often un-stated.

When I wrote the original article in 2007, Facebook, Twitter, LinkedIn and other social networks were not as mainstream as they are today; and users’ habits of using them and the amount of time spent were nowhere near what they are today.

The fact is, these changes in the marketplace have not only decimated industries and sectors (e.g. newspaper and magazine ad revenue) but have also created unprecedented new opportunities for marketers.  The real-time nature of the two-way digital medium enables marketers to see what their customers are talking about, sharing, and doing both on their sites and outside. The insights that can be derived from this data should enable the marketers not only to react, but also to optimize in real time while the campaign is still running.

ORIGINAL ARTICLE: “In-Situ” Marketing

This article explores how the speed of information has changed the “game” and the “playing field” for advertisers and proposes the concept of in-situ marketing as a way for advertisers to not only survive in this new business landscape but also to achieve competitive advantage.

Rapid advances in the speed with which information is shared and disseminated have had an enormous impact on advertising and marketing as we know it. Technological developments have changed virtually every aspect of our lives, including the way in which consumers make decisions and the way in which they gather the information they use for those decisions. In this radically changed environment traditional forms of advertising – getting information to prospective customers or encouraging them to adopt certain behaviors – are no longer effective.

The first part of the article will consider the way in which the environment has changed and how this has affected traditional marketing and advertising. In the second part of the article, we consider a new technique which we call “in-situ” marketing and look at how it can be used to take advantage of the new environment by utilizing the very changes which have rendered traditional methods obsolete.

The Impact of Speed and the Availability of Information

Perhaps the single most unifying characteristic of recent technological advances is the vastly increased speed with which information can be transmitted. At the same time, the increase in speed has been matched with a similar increase in the numbers of people who can be reached without the need for a corresponding increase in effort. The internet clearly lies at the center of this revolution, allowing as it does the almost immediate transmission of information to a vast number of people for comparatively little investment. No industry is immune to the effects of this revolution. Everything from classified ads to music to movies to travel and so on has been altered. As the behavior of consumers has changed with the evolving technology, traditional forms of advertising and marketing have been made increasingly redundant. We will look at each of these in turn, but before we do, it is important that we clearly distinguish them, because each has a particular and different purpose. “Advertising” is taken to mean any activity done to convey product attributes or brand characteristics to a broad base of consumers without explicitly requiring consumers to take any action (e.g. TV, print, radio). “Marketing”, on the other hand, is taken to mean any activity done with the goal of eliciting a specific action or response from the target consumer. So how has each of these been affected by the radical changes the new technologies have created?

The fundamental issue for advertising is that traditional forms have lost the effectiveness they once had. In a recent Forrester survey of the advertising industry, 78% of those surveyed noted that TV advertising was producing ever diminishing returns, while 48% noted that the most significant threat to successful advertising is “commercial clutter” – consumers are simply too inundated with information to be able to select and sort it in a way that is useful to them (and thus useful to the advertiser).

In the past there was a relatively simple correlation between the amount spent by a company on advertising and its sales – the more it spent, the greater the sales. This no longer holds true. A company can increase the amount it spends on advertising and can even target its advertising more carefully and selectively, but this is no longer necessarily correlated with an increase in sales.

In a nutshell, traditional approaches to advertising and marketing do not succeed in the changed environment in which information is shared almost instantaneously by innumerable consumers who are inundated with information and who are skeptical at best about the information they receive from people wanting to sell them their wares. How can advertisers and marketers adapt to the new environment so that they can again be effective?

“In-Situ” Marketing – What it is and How to use it

We believe the key to taking advantage of the new environment is by adopting what we call “in-situ” marketing. In this part of the paper we will briefly define the term and then go on to consider each part of the definition in more detail. “In-situ” marketing can be defined as marketing that leverages real-time, observed metrics to target individual consumers and improve effectiveness while the campaign is still running. So what does this mean in practice?

Firstly, it means that the information which advertisers and marketers utilize to make judgments about how best to proceed with a campaign is real-time information, received while the campaign is underway and acted on immediately. This contrasts with traditional techniques which would rely on information gathered perhaps over a six-month period or more, by which time the window of opportunity more often than not would have been lost. It means, secondly, that the information relied upon is gathered by observing the actual behavior of consumers, rather than relying on the self-reported behavior of consumers which, for a whole host of reasons, can often be quite different. By using the actual behavior, the campaign can proceed on the basis of much sounder and accurate data and will be consequently more effective.

“In-situ” marketing also means targeting individual consumers based on the information which is obtained so that there is a much greater correlation between the information being provided in the campaign and the person receiving it. Rather than relying on broad groups based on demographic information or segments identified by certain characteristics, “in-situ” marketing is concerned with finding all consumers who might be interested in the product, not simply those people who fall within a particular group identified by the marketing department. Finally, it means that the information which is gathered can be acted upon immediately so that a campaign can be altered and amended while it is still running to ensure that it as effective as possible from the point at which it begins until it ends.

This new approach is based on certain key principles:

• be where the consumers are already rather than seek to force them to go somewhere else – know where they are at now;

• find out what they think or know already and leverage it – consumers are empowered with lots of information and new sources they trust;

• leverage services that consumers already use for amplification – services like del.icio.us, moviefone, epinions have the “power of many”;

• create opportunities to observe preferences to the level of the individual, then act upon it to serve the individual;

• change traditional feedback loops making them “drastically tighter and faster” to match the speed of information;

• build a two way interaction with consumers and earn a trust relationship with them.

Conclusion

In this article we have looked at the way in which technological changes which allow for the rapid transmission of information to vast numbers of people for little effort have made traditional advertising and marketing techniques obsolete and ineffective. We have then considered a new approach which we term “in-situ” marketing as a means of harnessing these new technologies so that advertising and marketing can become relevant again to consumers and hence more effective. “In-situ” marketing is defined as marketing that leverages real-time, observed metrics to target individual consumers and improve effectiveness while the campaign is still running. It acts on information gathered while the campaign is underway so that the campaign can be modified immediately to be more effective in targeting individuals.