Marketing for Algorithms

A transcript of this interview appeared in Cision (in Portuguese)

With projections pointing to 80 billion devices plugged in by 2025, what challenges do they pose to brands? 
SN: The ability to network has reached more and more objects. The possibility of monitoring either mixed-object objects or physical objects will increase. We can already put sensors on physical objects. ‘Smart mirrors’, for example, can identify and display on the screen the parts a customer picks out. The mirror shows the sizes and colours available for each product and can even make recommendations based on customer preferences. ‘Smart’ clothing can monitor user behaviour, for example, knowing where the item is you want, and when you want it. The business ecosystem that meets the needs of these consumers is growing as ever: food (Deliveroo), music (Spotify), transport (Uber), hospitality (AirBnB), video (Netflix). Traditional brands should think about partnering with these new players.

Content marketing seems to be the way. Is it more valid than ever in this digital age? 
SN: There are more people online, which means they consume and share different types of content. By day, there are 3.5 billion searches on Google and billions of hours of content viewed on YouTube. People are not only consuming content, but also creating and sharing it. Per minute, 400 hours of videos are uploaded and 6,000 tweets are published per second. As we narrow the gap between humans and technology and experience increasingly sophisticated technologies, e.g. chatbots, AI, MR, voice search, then consumer expectations increase.

In an age as connected and evolving as ever, it is increasingly important for brands to identify the right context and time to engage. How can brands use this data effectively? Can this information be used to create new products or even shape loyalty programmes for existing customers? 
SN: One of the great challenges that brands will face is to ensure that there is consistency in the links and relationships between different devices and objects. Brands also need to assist governments and other public entities in matters such as security and privacy. With trust in brands becoming a decisive factor in loyalty, this will be instrumental in their success.

In this context, is advertising losing relevance? How can we reach audiences if people are less and less focused and less able to pay attention to offline messages? 
SN: In an incredibly complex and information-intensive environment, issues like ad blocking and fake news are becoming serious. As consumers continue to create and share data, as well as have several issues they want to see resolved, brands have an even greater role to play in ensuring that every message released helps the brand. In the future, there may come a time when marketers have to target algorithms or machines. This will probably start with basic choices. For example, simple merchandise purchases can be automated based on price. This will mean that brands work more in the pre-purchase phase, in order to influence the rules of the algorithm and thereby choose a brand on behalf of the consumer. But the focus should not be limited to influencing the algorithms. Emerging personal assistants, such as Alexa or Google Assistant, will also shape how we choose a brand. Brands and marketers will need to think about anticipating people’s routines and needs so they can have a preference for their purchases. They will also have to create better products to help meet these needs while taking into consideration sustainable supply chains.

Given all the above, is media planning also at a point of no return? What challenges does the industry face? 
SN: There are cultural, political and social challenges associated with any technology that is widely adopted. Scale is one such challenge: the best technology is still expensive; a Microsoft HoloLens costs more than $3,000. It is not easy to test technology because demonstration products are limited and nothing is better than experiencing ourselves. Another major challenge is the development of technology and content, since technology has not yet gained scale, companies do not invest heavily in content development and technically all this is still very difficult. Regulation is a whole new territory; our society is not yet mature enough to absorb all this evolution. Health and safety issues can arise, and there are consumer laws that need to be developed. And as with any innovation, competition is tough, HoloTouch sued HoloLens because of some patents.

And what is the social impact of these new technologies? What happens if a driverless car runs someone over? Or if a VPA realises that someone has committed a crime? 
SN: Marketers who are promoting brands using these new media play a role in formulating solutions to these challenges. But the major challenges will come with the ‘Merge’ between humans and technology. As the use of external devices disappears and is replaced by biologically embedded technology, more complications will arise for advertising. An industry that has settled into disruption will need other methods to reach people.

Brands are made by people to people. So how do we achieve effectiveness if the algorithms seem to go beyond humanity? 
SN: Algorithms already govern many aspects of our lives, not just in search engines and other technologies, but also in operations related to finance, logistics, transportation, and more. In the future, this influence will grow. With each object and contact point having associated information, and with algorithms prevailing in various industries, having a strong date strategy underlying brand activity is essential. This will facilitate the use of algorithms and technology. Communicating to algorithms is not the future, it is the present. And brands and marketers must be up to this challenge.

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