Community and commerce on the Internet

Over the past few weeks, we have been considering the thinking of Daniel Morel, global Chairman and CEO of Wunderman. Wunderman was the creator of direct marketing and remain the global Brand leader. We have looked at his concept of Marketing 3.0, and looked at the first two of the four key consumer questions he poses: Geography: Where am I at the moment? Context: What am I doing right now? Community: With whom am I talking? Commerce: How much is it and how am I going to pay for it? Now let’s talk about Community, the third pillar of Marketing 3.0. What Mark Zuckerberg did better than anyone is recognize the power of people. He said: “People influence people. Nothing influences people more than a recommendation from a trusted friend. A trusted referral influences people more than the best broadcast message. A trusted referral is the Holy Grail of advertising.” Following the launch of Windows 7 in Australia, Microsoft wanted more. It wanted 500,000 more brand impressions…and it wanted 5,000 of them to come from university students. So, here’s what Microsoft did. Using a compelling competition, it turned 5,000 university students into a living, breathing, and media channel to target the broader consumer audience. It calculated that to hit the target of 500,000 brand impressions, each of the 5,000 students needed to spread the product message to 100 consumers. The power of community is amazing. Nearly 7,500 students joined the Facebook group (150 per cent of the target) spreading the message to hundreds of thousands of Facebook users, ultimately achieving 10.4 million impressions, which translates to 200 times the target. This campaign worked because it utilized the full potential of social networking among college students and the creative idea was integrated across a range of tactics and disciplines from advertising to promotions. Daniel’s fourth pillar of Marketing 3.0 is of course Commerce, or more accurately MCommerce. This is a concept we in East Africa are already familiar with. Our pioneering of mobile money transfer remains a source of pride. And some sources equate its size to 20 per cent of Kenyan GDP. MCommerce is where the biggest revolution is happening. It is starting slowly, but once it catches on, there will be no stopping it. John Donahoe at eBay, who has seen dramatic increases in purchases made via mobile, predicts: “More people will be buying things with their cell phones than with their wallets over the next two or three years.” But will this include Africa? There’s no reason to suggest it won’t. All the research I read (including the latest KARF research on media in Kenya) tells of a growing African middle class. So, in spite of everything, the continent now has an estimated bourgeoisie of 350 million, up from 135 million in people in 1990 and 200 million in 2000. Arthur Goldstuck, MD at research firm World Wide Worx, recently Tweeted a presentation at NetProphet. In this he demonstrated that, for the past five years, South Africa has experienced a 30-35 per cent growth in online retail sales every year. Indeed in 2010, total online retail sales in South Africa passed the R2 billion mark. Penetration of mobile phones in that market stands at 92.2 per 100 people. Figures are similar in a number of other African markets: with Gabon at 89.9 and Algeria at 92.7 per 100. Couple that the undersea broadband cables now connecting to Africa and it becomes clear that we are bound to see a more digitally familiar audience migrating to E and Mcommerce. Coffee giant Starbucks is at the forefront of the digital wallet Revolution. All you need to do is enter your card number and your device will display a barcode you can use as your Starbucks Card to make purchases. It can’t be long before African retail innovators like Art Café or Dormans enter this space. But how will privacy fare in this new markeing age? In Privacy Lost (2006) David Holtzman writes, “When information is digitized and stored on a networked computer, for all practical purposes it is eternal, even if thought deleted. Once someone’s life has been sucked into the emerging mesh of interlocked computers, that definition of privacy is impossible.” Lester Wunderman argued “if we participate normally in our contemporary society, we have very likely surrendered our privacy. We have advertently or inadvertently become a member of the global society. And so some questions arise…” “What has happened to anonymity? “Do we, or did we ever, have “a right to privacy” “Can it be maintained or enforced?” Do we care that much? We don’t have all the answers right now. But perhaps some of you have views you’d like to share. If so, see you on www.chrisharrison.biz for a chat. Daniel Morel believes Marketing 3.0 is by far the most important revolution of our lifetime. Its impact will only be in marketing but will extend to the world around us. What makes it different form past “marketing revolutions” is the unprecedented speed at which brands will be built and destroyed; and new products emerge and become obsolete. The author is Chairman Young & Rubicam Brands Africa