From Information to Knowledge
Traditionally, information-reliant industries such as marketing, seek to assess the inherent value of the information they own, acquire and use. Resolving that, essentially, information can be considered a commodity, marketers apply a formula based on Return on Investment (ROI) – defined simply as “the amount of profit …. from an investment made.”
Economics guru and Noble laureate George Stigler, the person credited with birthing the science of Information Economics, turned this argument on its head – according to Stigler (PDF), it is knowledge, or the way information is applied – that influences market behaviour. Stigler argued further that the amount and accuracy of available market-knowledge are critical to this process.
As far as marketers are concerned, knowledge is derived from one of two sources:
- What they know about their customers, and
- What customers know about the brand
Traditionally, marketers know about customers through CRM and direct marketing, while customers know about a brand through its branding. Still, George Stigler observed that the consensus used to be that traders and investors knew a great deal, while customers knew little. This state of affairs has all but vanished in the 21st century Social Networks-driven economy.
Today, customers can search and access information that is needs-based, rather than product-based. They use search engines and peer-generated information on social networks to compare an entire range of products that are offered by various manufacturers, and reach an optimal purchase-decision, based on a host of criteria, such as application specifications, price, value-for-money, re-saleability etc.
The knowledge customers derive from such comparisons is valuable to both customers and marketers because both buyer and seller seek positive ROI: consumers can save money as they purchase and use the product, while brand owners can make a sale.
“What they tell us” vs. “what they do”
Marketers derive value from two types of knowledge-tracks: the explicit track is based on knowledge customers pass on to marketers by for example, answering questionnaires and surveys, filling in forms etc. On the other hand, the implicit track relies on actions taken by customers, for example, using search engines and clicking – or avoiding clicking – on links.
As they plan the details of the campaign or message they wish to disseminate, marketers can use multi-channel digital signals that are based on behaviour, conversation and engagement, to follow the explicit and implicit knowledge tracks, ascertaining – for example – how customers shop, which products they prefer and what form of information they need at each stage of the decision-making cycle.
According to MarketingSavant’s Dana Van Den Heuvel, engaging customers in conversations involves some – or all – of the following steps:
- Using search engine analytics, email, search engine alerts and feeds to identify brand-relevant keywords
- Identifying relevant conversation through mentions in Twitter, Facebook, YouTube. LinkedIn and other social sites.
- Ascertaining which conversations are relevant
- Deciding on the voice, tone and manner to use (for example – guiding, reflecting, challenging, enlightening, educating)
- Engaging, sharing and targeting
As they learn about the way customers influence behavioural change through engagement, marketers find new ways to drive-through the kind of messaging that may ultimately change behaviour patterns in their market.