Techno Dread

If marketers fail to show a greater understanding of new technologies and develop more effective ways to convey their benefits, IT companies could end up bypassing the middleman and going direct to consumers. Brian Wheeler and Philip Buxton as

The first wireless application protocol (WAP) phones – such as BT Cellnet’s Genie platform offering simple Internet text messages – have hit the market in a blaze of publicity in recent weeks.

But consumers are already being promised the next generation of mobile phones, which will offer full Net access, e-commerce, moving video services, the freedom to book theatre tickets and reserve a restaurant table from anywhere, or play video games on the bus home from work. They will even wake you up in the morning, though they stop short of making the tea.

Welcome to the nightmare world of marketing the new technology, where a revolutionary product can be outdated in a few weeks. Never before has the term “new and improved” been more short-lived. But the frightening pace of developments is leaving consumers in a spin. And techno-psychosis has hit marketers too, as they wonder how to sell products so complex and advanced, they can barely understand them, let alone explain their benefits to consumers.

The old certainties of marketing are being turned on their head as the pace of technological development increases. By the time a product is brought to market, the launch of an improved version may be just a few weeks away. And many new products offer so many applications that giving consumers a simple reason to purchase them has become a near-impossible task.

“In the past few weeks, I have noticed a lot of marketing people starting to get a little panicky,” says Simon Cheshire, a researcher at Net specialists Continental Research.

“There is a feeling that they don’t know what’s going on. There are conferences cropping up left, right and centre trying to tell them what is happening – but they are starting to get twitchy and are overcompensating. They are trying too hard to use a medium they don’t fully understand.

“The message I would give to marketers is ‘don’t panic’. Take a look at the research and make sure you do it right.”

But time is a luxury many in the business can’t afford.Paul Longhurst, managing director of Net ad sales house Quantum New Media, believes marketers are being pressured into making rash decisions. “The problem for a number of people is that while you are compiling research, the picture has changed and your competitors have made a move.

“You now hear marketers talking in terms of placing bets, which you would never have heard before. But you can’t afford not to be gambling because your competitors are. You can do so much homework, but then you have to go with your gut feeling.”

Inevitably, mobile telecoms and other technology-based industries are feeling the pace more than most.

The music industry has been thrown into a panic by the arrival of Web-based MP3 technology – which, in stark contrast to the stately and carefully controlled transition from LPs to CDs in the Eighties, threatens to turn the industry on its head.

Some industry observers fear that tried and trusted rules are being dangerously overlooked.

Philips, which has been at the cutting edge of product development for decades and has learned the hard way about allowing technology to dominate marketing, is extolling the virtues of customer research.

Its recent ad campaign for a new generation of cordless digital telephones was rejigged at the last minute after consumer research showed users were more concerned about signal clarity than the more esoteric features on offer.

The company’s research shows there is a yawning gap between the technicians’ jargon-fuelled vision of the future and consumers’ understanding, or interest in, what is on offer.

In its latest survey of 2,000 mobile users, 60 per cent said they were not interested in being connected to the Net through their mobile handset.

But, tellingly, 50 per cent wanted access to services such as e-mail and ticket booking, which are only available through a WAP Net connection.

Tim Mashman, marketing manager of Philips consumer communications, believes the industry needs to sell consumers the benefits of technology more effectively. “The level of understanding of most consumers is less than we imagine. They want the benefits but they don’t necessarily want to hear about the technology.”

Philips is launching its own WAP-enabled phone in the autumn and Mashman is confident the company can get over the built-in obsolescence factor.

He believes the key to prolonging the life of a new product lies in good design and finding out exactly what the consumer wants. “If you have a dialogue with consumers I don’t think the rate of technological change is a problem. It is possible to extend a product’s lifespan beyond a few months,” he says.

Carefully-targeted marketing

Barnie Evans, former marketing director of the Sun’s online provider CurrantBun and now at Talkcast Corporation, a company producing news and information services for wireless applications, also believes carefully-targeted marketing is the key to making WAP a success.

“People broadly understand Net and e-commerce functions, but there is a need for information on the next phase of cellular communications.

“It is now critical to communicate to consumers, whereas in the past it has not been. The availability of WAP phones, legislative changes, the bids for third-generation licences, not to mention AltaVista and NTL’s offer of free access, have brought things to a head.”

Zanussi, which recently signed a deal with mobile communications giant Ericsson, is also investing heavily in WAP technology, and is taking a cautious approach. The company is at the forefront of developing the networked home, which will allow all of the appliances in the home to talk to each other and be controlled centrally.

But Zanussi has been careful to avoid unleashing the full force of technology on its essentially conservative customer base. It shelved plans to allow “smart” appliances to call the service engineer when they develop a fault. Instead, the faulty machine will leave a message on its owner’s mobile (MW January 27).

Big brother scenario

Zanussi UK business development manager Graham Drage says: “We have had to be careful to avoid the ‘big brother’ scenario. People have to feel they are in control.

“Most of our consumers are women, who we have found are more sceptical about technology than men. They want to know what it’s going to do for them.”

If hardware manufacturers are finding it difficult to manage the pace of change then retailers are also having a hard time, especially with the move towards “convergence”, which threatens to tear up the traditional product categories most businesses are built around.

Steve Connor, commercial controller for multi-media at electricals chain Comet, says: “The reality is that the benefits of PCs we are selling to consumers are broadly the same whatever the developments.

“However, convergence is a much harder challenge for retailers because of how we are structured internally. We have four divisions: audio, vision, multi-media (PCs and accessories) and mobile communications. However, all contain products that work with each other. It is difficult to have a coherent approach.”

Comet is setting up demonstration areas in stores to show how technologies fit together. Connor adds that training problems mirror the blurring of lines between product categories.

He says: “How do you train staff? We traditionally train in either brown, grey or white goods. But we have to allow for the convergence particularly in brown and grey goods. We are completely restructuring our in-house training programme to give staff a wider knowledge of all product categories, and how it all fits together now and in the future.”

Failing to understand

Connor agrees that consumers are fearful of current technology being superseded, and of failing to understand the opportunities available to them.

He says: “Consumers, like us, find it all fascinating and exciting but also worrying. We have to show how technology will work for them.

“It’s definitely the case and always has been the case with PCs that consumers are worried they will spend a significant amount of money on a new technology only to have it superseded in the very near future. The average life cycle of a PC model is six to ten weeks. Replacement cycle average is about three years.”

Even when established retailers set up online operations there is a question mark over their ability to use the Net’s full potential.

Chartered Institute of Marketing (CIM) marketing director Ray Perry believes some retail marketers are failing to make proper use of customer information generated by automated transactions. “There is a mass of material being produced by the IT department but in a number of marketing departments it is just being used to prop open the door.

“Marketers are not making use of the information that is at their disposal.”

He adds: “The big challenge for marketers is to get involved with this automation before it becomes a closed door and the IT boys go straight to the consumer.”

He believes marketers should gain control of the company Website and fight for more funds at board level. “It is not enough to set up a site and then forget about it,” he adds.

Paul Shalet, sales and marketing director of Net service provider The XStream Network, also believes some marketers have a lot of catching up to do. “It is right that techies should lead but the type and quality of Net marketers is sadly lacking. The majority of dot-com advertising confuses rather than educates – it doesn’t tell consumers what the site can do for them.

“The job of marketing on the Net is not to take principles of offline marketing online – it is entirely different. There seems to be a gap between the packaged goods-style of Net marketing that currently exists versus what is really needed, which is to adopt the principles of direct response and one-to-one marketing. It is about marketing fulfilment as opposed to awareness.”

The marketers’ traditional task of showing the benefits a new product offers to consumers has become confused by the multitude of applications this technology allows. In a complex and uncertain future, the marketers’ job must be to overcome their fears and wrest control of the new developments from the hands of technologists. Failure to do so could hold back the take-up of these amazing new products for years to come.

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