At the close of 2019, we are not merely witnessing the end of a year of activity, but a decade of revolution. Rapid digitalisation, advances in automation and machine intelligence, and the evolution of new online shopping and media consumer cultures have left the marketing landscape unrecognisable in every conceivable way to its 2010 form.
To better understand the new order of things, as well as the opportunities and pitfalls that have been presented to us over the past 12 months, and the challenges that lie ahead, Marketing has spoken to several of Hong Kong’s leading brand marketing leaders.
Each was presented with a series of questions on the state of the industry, and their opinions on where it stands, where the priorities of practitioners should be, and where to move next, were radically different.
But in the radical age we live in, where innovations have meant entire skill sets, specialisms, and even sectors, being both created and abandoned in quick succession, why would we expect anything different?
In this feature we have views from Haymans Fung, chief marketing officer at Sun Life Hong Kong; Eddy Kwong, director and head of digital marketing and transformation for Asia Pacific at Allianz Global Investors; Peter Larko, director of marketing and PR at Mercedes-Benz Hong Kong; Alison Massey, group marketing director at Now Health International; Simon Shing, assistant vice-president and head of marketing at FWD HK; and Nancy Ting, head of consumer marketing at Google Hong Kong.
What marketing tech had the biggest influence on 2019?
Fung: Artificial intelligence. AI has influenced and changed the way we do targeting, programmatic buys, and automation. AI enables higher personalisation, real-time responses, and prediction of consumer behaviour.
Kwong: I don’t think there is any particular marketing tech that is noticeably big. But the idea of “phygital” – the attempt to merge the physical and digital experience has been used a lot more in 2019.
Massey: 2019 saw chatbots go mainstream, as more and more businesses launched this technology in a bid to enhance the service experience while driving efficiencies. This trend will only continue and it’s predicted that by 2021 that 50% of businesses will spend more on chatbots than on traditional mobile apps.
We launched a chatbot on our Facebook messenger platform last year to help field many of our frequently asked questions, and we’re planning to integrate a chatbot service into our live chat function to deliver a faster and more efficient customer experience.
Shing: AI. We can see its application everywhere from media buy to content creation – one example being bespoke versions of YouTube videos – as well as chatbots for marketing or customer service purposes.
Ting: Digital marketing. According to a recent study we collaborated on, the top quartile of brands surveyed in Hong Kong reported significant benefits from digital marketing, achieving an average of 9% in incremental revenue and 11% cost efficiency.
What was the most inspiring use of tech you saw in 2019?
Fung: Dynamic pricing used by various tech companies. Demand-based price changes are nothing new – think changes to hotel room rates depending on the season – but with AI entering the equation, prices can be determined and optimised with a whole new level of precision, taking a wide variety of data into account.
AI is used for dynamic pricing, which analyses a customer’s data patterns and predicts what they are likely to be willing to pay, and also their receptiveness to special offers. This allows more precision in targeting to calculate the exact level of discount needed. Airbnb is one brand that has built an extremely sophisticated dynamic pricing system to help property owners determine property prices.
AR for the insurance industry has so far been limited to obvious use cases such as car and home insurance, but the applications for other verticals such as health are exciting.
Massey: There have been some creative uses of augmented reality within corporate marketing strategies to help bring products to life to customers. For example, online retailer Wayfair introduced an in-app feature which lets customers see how furniture would look in their own home. Dior did something similar with an Instagram filter which allows customers to virtually try out new beauty looks and accessories.
Shing: A virtual contact centre that talks with real customers on calls, and can sense the customer’s emotions and reacts differently, even changing to another call agent when a customer is getting angry.
Most importantly, you don’t even know you are talking to robots!
Ting: The most inspiring use of tech that we saw in 2019 was smart assistants. With the heavy investment in natural language processing, AI, and machine learning, smart assistants deliver even more natural and useful experiences to help users get things done.
Mobile changed the world 10 years ago, and users are turning to their devices with specific intents in a variety of input methods such as text, touch and voice.
We noticed that users interacting with the Google Assistant app were 40 times more likely to use action-oriented queries than search, with people often asking it to “send a text message”, “call someone”, “remind me to …” or “turn on airplane mode”.
What trend took the lead in 2019?
Fung: The use of AI in marketing such as in product or content recommendations, search engines, personalisation, targeting, and product pricing.
Massey: Mobile pass technology gained considerable traction this year. The technology is no longer only being used for mobile wallet payments (which are growing at an exponential rate), but as a broader customer engagement channel for loyalty schemes, offers, and events.
We recently launched mobile pass membership cards to better empower our customers. Our mobile pass draws down information about a member’s plan in real-time from our proprietary database and makes it easier for customers to validate their coverage when seeking medical treatment.
Shing: 5G. It creates expectations of what substantially increased bandwidth will enable for a lot of marketing applications in a real-time manner.
What trend died in 2019?
Fung: Chatbots. Over the past few years, the chatbot star has risen dramatically and then fallen even more dramatically, as a one- hyped application of AI was found not to work as well as many had hoped. However, many companies are still investing and exploring the use of chatbots; the latest development that has been proven to be delivering business results is conversational AI.
Kwong: Text-driven social media content. Larko: VR, though it might come back when the tech and hardware is more mature.
Massey: Mobile apps are on the way out – indeed data shows the total number of Apple and Android apps has been on the decline since 2017. Businesses are gradually moving away from native apps to more integrated and responsive online content via web apps. However, this trend creates huge efficiencies for marketers as the development of a company’s web apps usually rests in one place instead of many.
Shing: Programmatic to a certain extent.
Do you think we came to grips with any issue as an industry in 2019?
Larko: Sadly, not really. Some progress on fake content, but still very far to go.
Massey: With the launch of GDPR in 2018, 2019 saw the execution of marketing activities using the new framework. The principles of the regulation considerably improved the consumer’s position, but there was a lot of apprehension within the industry that GDPR would kill a number of established demand-generation techniques.
In the end, it hasn’t been the monster we all feared but has challenged and changed the way we think about targeting and data gathering.
For international businesses, the reach of GDPR lies well beyond Europe and the expectation is that tighter regulations across the Middle East and Asia Pacific will continue to be introduced in the years ahead.
What’s the biggest problem issue we still have to grapple with as an industry?
Fung: Even with the help of all our technology, I still think as marketers, we have yet to master how to measure and report on the interactions our customers have with our campaigns to reveal how their visits drive actual sales and revenue.
In order to be relevant and really assist people, we need data. We’ve got to use it in a way that adds value to our marketing communications every step of the way.
To improve the customer experience, we must break down organisational and technological silos. This by far is the most complex and challenging problem to solve. It means really taking a look at how our business is organised and what technology we are using, then finding a way to connect it better.
Also, we need to recognise that data is a reflection of the customer’s journey, with each moment offering an opportunity to be relevant.
Opportunities for growth require us to put customers at the centre of our strategy, which includes understanding the real impact each customer or customer segment has on our bottom line. We need to focus on customer value and long-term outcomes, and aligning our marketing metrics with these goals. This means we need to determine a media metric that drives business outcomes (return on ad spend, micro-conversions, store visits, or brand lift, for example) and invest in strategic experiments to find new experiences that will change the path of future growth.
Kwong: I think many marketers are not truly serious about data and customer insights. We are certainly moving there. But how many brands, creative outfits, and media agencies out there would really work together to start any marketing efforts from data, customer insights, and research? I’m sure there are pockets of us doing it, but I’m talking about all parties working together on it.
And how about going beyond just impressions and clicks after the campaign to dig deep on what people are saying and feeling about the campaign? Both quantitative and qualitative data are equally important.
Larko: I think privacy will continue to be a huge issue.
Massey: One of the key issues the industry needs to tackle is the importance of talent investment to ensure the profession can stay ahead of the curve and leverage new technologies to its advantage. This includes investment in skills such as UX/UI design, customer journey mapping, and data analysis.
Shing: Marketing ROI is still a key issue given the nature of marketing, and given the proliferation of consumer touch-points and ever-changing consumer behaviour, it makes justification of marketing investment more and more difficult.
Ting: For the marketing industry, there is an even greater need of digital talent to be able to drive the industry forward as consumers become more digital-savvy. With 89% of corporates anticipated to increase investment levels on digitalisation in the next two years, 64% of corporates think staff with a STEM education background are hard to recruit.
Encouragingly, 81% of residents are willing to learn and acquire new digital skills with specific interests in app development (41%), AI and machine learning (40%), and data analytics (37%). Marketers need to continue brushing up their digital skillsets to keep themselves relevant in the ever-evolving industry, and there are many free tools and resources they could use.
In addition to retraining the current workforce, we also need to help the future generation master digital skills such as coding and computer science. Looking ahead, stronger collaboration across the industry to apply AI and technology in practice, and provide staff members with access to the right training resources, is going to be critical for success.
What technology are you most excited about the advancement of?
Fung: Blockchain, to be utilised in smart contracts and digital identity. And a new level of AR, powered by 5G.
Kwong: Content continues to be critical. To me, I would definitely want to see more application of AI and natural language generation in the future. If the technology can become more advanced going forward, we can move beyond text content, to voice, and to video. We can then generate content that is more timely and relevant for our customers.
Larko: Voice technology for search, control, and commands.
Massey: AI offers huge potential, particularly within the health insurance industry. For us, it opens up significant opportunities to enhance the customer experience – from intelligent underwriting at the point of sale, through to telemedicine consultations when members need treatment, through to automated and faster claims processing.
Shing: The integration of recognitions, AI, and language applications – those behind virtual assistants.
What tech will have the biggest influence on 2020?
Fung: AI will continue to be the biggest influence as more and more data becomes available for the greater sophistication of bot learning and automation. This will mean more sophisticated personalisation of messaging and media selection. 5G will also start to gain significance as it will enable a whole new level of creativity and engagement in marketing and advertising.
Kwong: A much more solid use of AI will be a big influence. People have been talking about how they use AI in marketing, but it is not widely used yet. Lots of fintechs and start-ups have great solutions out there, but I don’t think marketers are partnering with those fintech solutions actively just yet.
Larko: More accurate targeting and personalisation at scale, coupled with more AI and machine learning.
Massey: Big data will be king in 2020. There is an increasing awareness among C-suite executives of the need to better capture, leverage, and monetise data, including for more cost-effective marketing and results measurement. As businesses invest in more advanced data mining tools, the insights and potential advances are boundless.
Shing: AI, with the integration of recognition technologies such as facial and voice recognition. When the integration of these technologies matures, it will be time for virtual assistants to become “real”.
Ting: In 2020, with the increasing number of brands that would have built solid data foundations, we could expect more will explore and take advantage of the new technology and AI in marketing. This could mean smarter creative, providing brands with the ability to compare and personalise creative output for their customers. Smarter bidding will allow more efficient, real-time bids and smarter attribution to better measure intent through non-last click, data-driven attribution to help understand the true drivers of conversion, and assign the right value throughout the user funnel.
What’s the next big trend?
Fung: Conversational AIs and speech recognition technology.
Larko: Anything that can increase productivity while reducing screen time.
Massey: The next big opportunity relates to increasing personalisation and more targeted marketing as a result of technology and better access to data.
In an Econsultancy study, 67% of marketers said they wanted to improve their personalised experiences, so it’s a material trend. But just as the study suggests, data integration is the biggest obstacle to successful implementation. So, while cracking the big data nut will transform access to truly personalised experiences, most of us aren’t there yet.
Shing: 5G that allows real-time AI applications.
Ting: I’m excited about the opportunities presented for brands to engage customers via simple and intuitive voice commands, and bring more delightful experiences to perfect the customer journeys. For example, music apps such as KKBOX, MOOV and YouTube Music have integrated with Google Assistant, allowing users to ask to open the app and play the song using verbal communications.
Going into the new year, it’s expected that more applications will be developed and more smart devices will be enabled with smart assistants. It’s time for businesses to be creative in embracing smart assistants in their customer journey and marketing campaigns.
Any final thoughts on the year to come?
Kwong: Smarter machines; smarter humans.
Larko: Yes, it’s gonna be epic!
Massey: Whatever new technologies and trends are on the horizon, it’s important the industry does not lose sight of the overarching customer experience and how it aligns to ever-increasing levels of expectation from discerning customers. Yesterday’s “slay” is tomorrow’s “yawn”.
Shing: Follow consumers, not technologies. That’s what marketers do. Of course, technologies are important nowadays as they are the enabler to make marketing more precise or more efficient. But being truly centric to consumer needs and behaviours is the core.
This article was produced for the December/January Futurist issue of Marketing Magazine Hong Kong. For more features and other magazine-exclusive content from this and upcoming issues, you can subscribe to receive your free monthly print copy here or you can read the digital version in its entirety here.