The obstacle is the way

How new privacy initiatives from Big Tech will prompt good marketers to reach for the stars and build real communities

📸 Flashback: Just last week we talked about how the ‘buy now, pay later’ model was sweeping across finance. This week, the gale of BNPL news continued to blow:

Scalapay just raised $155m to fund BNPL expansion; perhaps because…
research indicated that most people expect BNPL to replace credit cards; so no surprise that…
the Sachs of Gold are getting on board the bandwagon by acquisition; but…
Monzo is taking a short cut; while…
Curve is also joining the fray; and…
BNPL firms are even winning on social media marketing.

The question I keep asking myself is: why all the hype for a business that is both ethically questionable and very low margin?

👉🏻 Now, read on to learn why:

① The rules of digital marketing are being rewritten by privacy concerns.

② Building community is a highly prized marketing goal.

③ Investor ranks are swelling and demand for advice booming.

④ The scale and scope of DeFi are now undeniable.

⑤ Clients care about the why; the what are the how come later.

⑥ Facebook knows its apps are harmful but doesn’t care.

⑦ Far too many investors get their advice from social media.

What's new?

The New York Times published a characteristically comprehensive look at how the battle for digital privacy is reshaping the internet.

Source: The New York Times, 16 September 2021

Apple, Google and Facebook have all made changes to their platforms recently which at first glance appear to be mere tinkering. They’re much more significant than that. In short:

“Digital ads powered the growth of Facebook, Google and Twitter, which offered their search and social networking services to people without charge. In exchange, people were tracked from site to site by technologies such as cookies, and their personal data was used to target them with relevant marketing.”
“Now that system, which ballooned into a $350 billion digital ad industry, is being dismantled. Driven by online privacy fears, Apple and Google have started revamping the rules around online data collection.”
“Businesses that can no longer track people but still need to advertise are likely to spend more with the largest tech platforms, which still have the most data on consumers.”

Why does it matter?

Smaller, transactional businesses that rely on online marketing for their sales will be the most impacted by these changes but financial institutions large and small - whether B2C or B2B - will need to adapt too.

The crux of it is twofold.

Reaching the right people: It will be much harder to serve content and ads to a relevant audience online.
Knowing whether they care: The metrics we have previously used to measure the effectiveness of our messaging - notably email open rates - are about to become unreliable.

Innovation comes from discomfort. Now marketers must rethink their approach and double-down on building strong relationships with their audience. In short, this is an opportunity to aim for that most prized of marketing goals: to build a community.

② A community is much more than just a mailing list. It’s a group of well-qualified clients, potential clients, and other stakeholders or influencers who align with your purpose, value your expertise and regularly come out - online and in person - to engage with you and their peers. It’s most prized because people are far more loyal to a community than they are to a simple brand. The challenge is how to put yourself at the heart of that community.

What's next?

Take action

This is a topic we’ve touched on before, notably back in June when Apple announced iOS 15. Back then, I wrote about how to get close to our audience, how to provide more personalisation, how to motivate them to engage with our messages. In short:

Consent: Clients will generally be happy to share their data as long as it’s a transparent process and they’re getting something valuable in return.
Value: Some marketing teams have become so addicted to tracking and prioritising bottom of the funnel metrics that they’ve forgotten about providing great content. What makes content great? There’s a simple litmus test: is it providing value to your audience?
Rapport: Without tracking data, you’re going to have to get to know your audience in other ways. Asking them questions is an excellent place to start. You can uncover demographic information with reader surveys but think bigger: delve into their preoccupations, their pain points, their interests. As long as you’ve established consent and are offering value, then starting a conversation is a natural next step and your audience will likely be open to it.

But that’s really just the beginning. Once you’ve got a well-qualified audience, building a community demands:

Expertise: Are you regularly offering fresh insights and ideas - both your own and those of others?
Discussion: Are you providing opportunities and motivation for your audience not just to benefit from hearing a discussion but to take part in it too - whether online, on social channels or at ‘in person’ events?
Networking: Are you connecting people in ways that create new opportunities for them - whether or not they’re using your products or solutions?

As you review your marketing plan for the next few months, ask yourself how many of your tactics will take you closer to building a real community.

Get help

I’m looking for a full-time, in-house role but in the post-Covid age of depleted marketing budgets and remote teams with skills gaps, many organisations need marketing and communications support that’s agile, flexible, and risk free. That’s why I founded WhatsNext Partners.

Whether it be as a permanent member of your team or with on demand support, just hit ‘reply’ to let me know if you need my help.

Share

Can I ask you a favour, dear reader? If you found this post useful or know someone who would, please like, comment on, or - best of all - share it with your professional network. It really helps me to grow the readership.

What else?

Three other articles that are worthy of your time.

FINANCE

Demand for advice rises as not all investors go it alone

③ Investor ranks are swelling and asset managers need to advise them - otherwise social media will (see ⑦).

Source: The Financial Times, 13 September 2021

“New share trading account openings have surged over the past year, against a backdrop of increased risk tolerance of some retail investors. But the investment climate has also spurred demand for financial advice, via pure digital or ‘robo’ services, as well as more hybrid models that combine technology with a human touch.”
“That is why the likes of Vanguard, Schwab and Fidelity are intent on providing hybrid advice that spans both digital and human platforms. Others, like JPMorgan, have bought advice platforms such as Nutmeg in the UK, while Vanguard has also launched an advisory service for UK investors.”
“In the past, only the wealthiest of investors sought advice but, now, as the barriers fall, advisers are mindful that they need plenty of options to satisfy a broader audience in order to win and retain customers.”

TECHNOLOGY

The beguiling promise of decentralised finance

④ The scale and scope of DeFi are now undeniable and even making the revered front cover of The Economist.

Source: The Economist, 18 September 2021

“DeFi is one of three tech trends disrupting finance. Tech platform firms are muscling in on payments and banks. Governments are launching digital currencies, or govcoins. DeFi offers an alternative path which aims to spread power, not concentrate it.”
“Conventional banking requires a huge infrastructure to maintain trust between strangers. It is expensive and often captured by insiders. By contrast, transactions on a blockchain are trustworthy, cheap, transparent and quick—at least in theory.”
“Finance is entering a new era in which the three novel but flawed visions of tech platforms, big government and DeFi will compete and intermingle. The revolution stands to transform how money works and, as it does so, the entire digital world.”

MEDIA & MARKETING

Why purpose is the most important ingredient for brands

⑤ Clients care about the why, the what are the how come later.

Source: AdAge, 17 September 2021

“Consumers today are looking for brands to take a stand on the issues they care about. There needs to be a clear and powerful connection between product, service and purpose.”
“Employees are the most influential group in driving a brand’s success. They are the most impactful advocates.”
“People don’t care about what you say; it’s all about what you do.”

Quotable

⑥ Facebook knows its apps are harmful but wants us to keep calm and carry on, according to the PR gaff-prone Head of Instagram Adam Mosseri:

Instagram head Adam Mosseri. Source: Vanity Fair, 16 September 2021

I think anything that is going to be used at scale is going to have positive or negative outcomes. Cars have positive or negative outcomes. We understand that. We know that more people die than would otherwise because of car accidents. But by and large, cars create way more value in the world than they destroy. And I think social media is similar.

Mosseri learnt arrogant disdain for his users and their governments from his boss and that’s one of the reasons I quit Instagram this week.

One more thing...

⑦ US Gen Z investors rely mostly on social media for financial advice according to this shocking chart:

Michael J. Miraflor

@michaelmiraflor

I think we all felt this was happening but having it laid out like this is really... wow. https://t.co/w0eN9883HL

9:40 PM - 17 Sep 2021

And before you take comfort in the assumption that UK consumers are more sensible than their American cousins, bear in mind that 18.6 million UK adults trust the financial advice shared on social media platforms, despite not knowing where it has come from.

Off cuts

The stories that almost made this week’s newsletter.

MONDAY

🚬 Softbank partner took investor meeting barefoot and smoking

TUESDAY

🤑 Brevan Howard launches crypto division

🙊 Intuit to acquire Mailchimp for $12 billion

🐦 Twitter reopens public verifications

WEDNESDAY

👮🏻‍♂️ Coinbase’s brash approach to rules will do it no favours

🤷🏻‍♂️ JPMorgan: Prepare for the ‘platform of platforms’ economy

🦺 FCA sets out strategy to tackle consumer investment harm