Marketing 3.0 - from Products to Customers to Human Spirits - part 1

In the next days i will put some parts of my marketing paper on my blog.
The first part of it, is already in my last post about the 4 quadrants of change. Based on this model of change, my suggestion is to beginn marketing on the basis of individual visions, missions and values.
In this post I am talking more about personal visioning and new approaches to marketing.

Personal Vision, Mission and Values

To start the process of a successful company, it is most important to be clear about your personal visions, goals and values. Especially for Start-Ups and entrepreneurs this is the most important step, since the person and the company are virtually the same. Only with strong personal values it is possible to survive in this fast changing economy. Not without reason, Guy Kawasaki dedicates the last chapter of his book “The Art of the Start” to the topic of personal integrity and has praise on the cover saying “Focus on what is real and forget the fluff. And please, read the last chapter first” by Pierre Omidyar, the founder of E-Bay. In his book he describes the Yiddish word “mensch” as a term for a person who is ethical, decent and admirable.
The three foundations of “menschhood” are:

·         Help many people:
a mensch helps people regardless of whether it´s good for this life or the next.

·         Do What´s Right:  A mensch does the right thing –not the easy thing, the money-saving thing, or the I-can-get-away-with-it thing. Right is right, and wrong is wrong.

·         Pay back society: there are many “currencies” with which you can pay back society. Money is only one of them, others include giving time, expertise, emotional support. A mensch pays back for goodness already received – as opposed to pay forward in expectation of return (Kawasaki, p. 211-214)

This is the foundation of business success in these days. Having high personal ethics is the only way to ensure that your company will reflect high ethics in its everyday life. Personal integrity is the only way to ensure that your company will have integrity even when times are hard, and problems are challenging you.
Therefore the first step for every entrepreneur has to be, to get clear about personal goals and values and align the company with these core principles.

New approaches to marketing

Understanding now, how important it is, that every individual is in line with their own personal values and the companies values and believes, I want to give a brief history of marketing, as shown in Philip Kotlers book Marketing 3.0.

As Marketing 1.0, Kotler describes the product centric marketing in the industrial age.  It is about selling basic products for mass markets with the goal of standardizing and up scaling (example: Ford, Model T). Marketing 2.0 is an outcome of the information age. Consumers are well informed, compare products and are very critical. Consumers get segmented and superior products for specific markets get developed. The golden rule is “Customer is King”. Now Marketing 3.0 rises. Instead of treating people simply as customers, marketers approach them as whole human beings with minds, hearts, and spirits. . Customers increasingly want to make the world a better place. They search for companies that address their deepest need for social, economic, and environmental justice in their mission, vision and values. Customers look for functional, emotional and spiritual fulfillment. Companies have bigger mission, vision and values then just serving customers. Marketing 3.0 companies provide answers and hope to increasing poverty, environmental destruction and pandemics and therefore touch consumers on a higher level. (Kotler, p. 3-6)

	Marketing 1.0 Product-centric marketing	Marketing 2.0 Consumer-oriented Marketing	Marketing 3.0 Values-driven Marketing
Objective	Sell products to mass	Satisfy and retain consumers	Make the world a better place
Enabling forces	Industrial Revolution	Information technology	New Wave Technology (connectedness of consumers)
How companies see the market	Mass buyers with physical needs	Smarter Consumers with mind and heart	Whole human with mind, heart and spirit
Key Marketing Concept	Product development	Differentiation	Values
Company marketing guidelines	Product specification	Corporate and product positioning	Corporate mission, vision and values
Value Proposition	Functional	Functional and emotional	Functional, emotional and spiritual
Interaction with customers	One-to-many transaction	One-to-one relationship	Many-to-many collaboration

(Kotler, p. 6)

3 major forces have transformed consumers to be more collaborative, cultural and human spirit-driven. Understanding these, leads to a better understanding of Marketing 3.0:

·         The age of participation

·         The age of globalization paradox

·         The age of creative society

The Age of participation

Since 2000 information technology is in mainstream market and based on that is the rise of “New Wave Technology”, which are technologies that enable connectivity and interactivity of individuals and groups.  3 mayor forces shape these technologies: cheap computers and mobile phones, low-cost internet, open source.
“New Wave technology” allows individuals to express themselves and collaborate with others – people create ideas, entertain them and consume them. One of the leading enablers is social media. There are two broad categories: expressive (blogs, facebook, YouTube, twitter, flickr, etc) and collaborative (Wikipedia, Craigslist, etc). In the new interlinked economy, companies practicing these strategies collaborate with another, with their shareholders, with their partners, employees, consumers and other businesses with similar sets of values and desires.

The age of globalization paradox

Information technology allows for exchange of information through nations, corporations and individuals and transportation technology fosters trade and other exchange in global value chains.  Globalization is full of paradoxes:

1.      While democracy is finding more global roots, the new, nondemocratic superpower China, grows in power. China proves that capitalism does not require democracy.

2.      Globalization calls for integration but does not create equal economies. Many third world countries are worse off than they were.

3.      Globalization creates diverse cultures: tribalism and globalism. It creates universal, global cultures, while also strengthening traditional cultures as a counterbalance.

The age of creative Society

Creative, right-brainers work in sectors such as science, art, and professional services. According to Daniel Pink, creativity is the highest level of social development in human civilization. Even thought the numbers are small, their role in society is increasingly dominant.  Kotler states that:
“Creative people are, in fact, strong believers in the inverted Maslow pyramid. The definition of spirituality as “the valuing of the nonmaterial aspects of life and intimations of an enduring reality” really finds its relevance in creative society. Scientists and artists often abandon material fulfillment in pursuit of self-actualization. They seek beyond what money can buy. They search for meaning, happiness, and spiritual realization. […] Like creative people, companies should think about their self-actualization beyond material objectives. They must understand what they are and why they are in business.” (Kotler, p 19, 20).

For the Future of Marketing, Kotler sees 3 mayor trends that will help companies to regain the trust of consumers that they have lost over the past 60 years. Consumers now gather in their own communities and co-create their own products and experiences. Kotler predicts 3 cornerstones of future marketing that companies must understand in order to be successful: customers increasingly appreciate cocreation, communitization and character.

•  Cocreation: the new ways of creating products and experiences through collaboration by companies, consumers, suppliers and channel partners connected in a network of innovation. Companies need to create platforms, allow users to customize the platform and then incorporate the feedback into the platform. Example: Open source, Nike – design your shoe http://nikeid.nike.com/nikeid/index.jsp
• Communitization: Technology allows for more connection and the concept of communitization is closely related to tribalism as coined by Seth Godin.  Godin argues that consumers want to be connected to other consumers, not to the company. Consumers are either connected to one another (webs), to a leader (hubs) or an idea (pools). They do not exist to serve the business, but the members.
• Character: Companies need to develop an authentic DNA that reflects the brands identity.  When consumers view a brand, they can and will immediately judge whether it is fake or real. Therefore companies need to always be real and deliver experiences that come up to their claim.