Thailand Digital 5.0: is it time for a change?
Updated: Feb 12, 2020
Thailand Digital 5.0: is it time for a change?
In the age of 5G, the speed of digital disruption would only increase. We are going from the 4th generation of cellular network to the 5th, that will allow data to be transferred and consumed at an even faster rate with less delay.
Both aspects point to the same conclusion, people will consume more data at an even faster rate. This new level of speed and volume of data distribution and consumption opens up a whole new dimension on how business can and should interact with consumers.
Currently, an individual mobile user accesses over 250 website and applications per day. Unsurprisingly, the visit destinations are dominated by Social Media and Search Engines, accounting for almost 50% of on-screen time (see figure 1). Furthermore, only 6 types of platforms account for over 90% of total online time on mobile data. The top 3 platform types – Social Media & Blogs, Search Engine, and Instant Messaging – are platforms where information flows in both directions.
Not only are they becoming accepted sources of information, their unique positions in both reach and spontaneity have propelled them into the preferred choice of advertising. As a consequence, consumers are constantly bombarded with information through these platforms, whether desired or undesired as well as true or false. There is so much “noise” that it is becoming ever more difficult to cut through to the right consumers with the right messages and not get swallowed up in the massive flood of information.
Figure 1: Time spent online by website and application type via mobile internet, based on Q2 2019 TrueMoveH users nationwide
In a world where information are clicks away and everyone is always connected, many businesses face a real challenge in retaining consumer base and loyalty, not to mention acquiring valuable consumers. The traditional approach has always been to incentivize loyalty with some form of rewards, that with the right incentives the consumers will continue to buy from you. But with intensifying competition and everyone investing in a more and more aggressive loyalty programme, this is quickly becoming more and more costly and good deals can be found around every corner. Accenture Digital research finds that 71% of consumers says loyalty incentives programme does not make them loyal[1].
If loyalty is no longer enough, what will it take? Would Marketing Mix 4Ps that has dominated marketing for the last several decades still suffice? Perhaps it is time to add another P into the model – Personalisation. A new kind of personalisation that harnesses the power of Big Data Analytics.
A new level of personalisation – introducing “Relevancy”
Every purchase decision starts with the inception of needs. A consumer is faced with a certain situation or a series of situations that calls for a solution, resulting in a need. By nature, situations are not permanent and humans are not patient with problems. So, a need has a very specific time window, based on the priority the consumer assigns to it. Unless a business can provide a solution that suit consumer’s needs within that time window, the opportunities are lost, most like to a competitor who was able to move faster.
There are two key components at play here to satisfy any consumers’ needs: tailoring to the needs, and tailoring to the time window. Now personalisation not only mean delivering the right offer to the right customer, but also at the right time. In other words, personalisation has to be highly relevant to be successful.
But in the digital world where everyone is always connected and information flows freely at dizzying speed, how does one reach the right customer at the right time? The answer is to accept the change in the market place and adopt a new paradigm of growth, a customer-centric data-driven growth.
Big Data and a New Dimension of Insights
Big Data technologies has enabled access to a whole new dimension of consumer insights. Combined with Advanced Analytics, businesses can gain unprecedented insights into the demand dynamics. Before a consumer decides to make a purchase, a need must arise. But that is only the starting point. An intelligent consumer will always seek to find the best offer that satisfy the need. This process can be represented below, classified into 5 stages[1].
Need: This is where a consumer recognised the need, resulting in a demand. At this stage, a consumer forms a basic evaluation framework of what would solve the problem.
Search: With a framework established, a consumer begins researching available options that passes the fundamental evaluation criteria.
Comparison: After a sufficient number of viable options has been collated, the consumer evaluates each option to find the “best” option. This can be across a number of factors, most commonly price, quality, and timeframe.
Decision: After weighing the pros and cons of each options, a consumer selects the “best” option in his or her opinion and make the purchase.
Feedback: The consumer then re-evaluates the purchase post-decision, mainly if the selected option meets the original expectation or not, determining whether the consumer will repurchase or recommend the option or not.Before the digital age, once a consumer recognised a need, window-shopping is the most common form of option searching. The consumer visits a few stores and collects relevant information. With physical mobility coming into the equation, the “Search” stage is costly and restricted by multiple factors such as free time and proximity to shopping area. This is why “Price”, “Promotion”, and “Place” were so important. If it is within a consumer’s proximity, the chances of the “Product” being purchased is much higher However, businesses only begin collecting real data after a purchase has been made. Therefore, businesses were blind to the earlier stages of the decision process, where demand occurred and search and comparison took place. Businesses were forced to react to consumers rather than proactively engage consumers with relevant offers. In the digital age, search engine has become the first go-to place whenever needs arise. From a search engine, a consumer is exposed to a myriad of options on the internet during the “Search” stage. “Comparison” can be done as easily switching between browsing windows. “Price” and “Promotion” can be compared almost without cost to the consumers. “Place” has been transformed from offline to include online marketplace and visibility. Now, the entire decision process is visible from end-to-end. Big Data Analytics allows businesses to analyse the market behaviour from the moment searches began, the comparisons took place, when decisions were made, to when the feedbacks being broadcasted and circulated. With near perfect information available at the fingertips of consumers, the one to win over the consumers is the one who is able to harness the power of data and provide the most relevant offer to the consumers.
Before the digital age, once a consumer recognised a need, window-shopping is the most common form of option searching. The consumer visits a few stores and collects relevant information. With physical mobility coming into the equation, the “Search” stage is costly and restricted by multiple factors such as free time and proximity to shopping area. This is why “Price”, “Promotion”, and “Place” were so important. If it is within a consumer’s proximity, the chances of the “Product” being purchased is much higher.
However, businesses only begin collecting real data after a purchase has been made. Therefore, businesses were blind to the earlier stages of the decision process, where demand occurred and search and comparison took place. Businesses were forced to react to consumers rather than proactively engage consumers with relevant offers.
In the digital age, search engine has become the first go-to place whenever needs arise. From a search engine, a consumer is exposed to a myriad of options on the internet during the “Search” stage. “Comparison” can be done as easily switching between browsing windows. “Price” and “Promotion” can be compared almost without cost to the consumers. “Place” has been transformed from offline to include online marketplace and visibility.
Now, the entire decision process is visible from end-to-end. Big Data Analytics allows businesses to analyse the market behaviour from the moment searches began, the comparisons took place, when decisions were made, to when the feedbacks being broadcasted and circulated.
With near perfect information available at the fingertips of consumers, the one to win over the consumers is the one who is able to harness the power of data and provide the most relevant offer to the consumers.
Embracing Changes and Building Relevancy
It is a daunting task for any company to embrace changes, especially in a fast pace digital age. But the following 3 guiding principles should help in establishing a framework to better stay relevant.
1. Understanding your consumers and their journey
It is not possible to acquire more consumers if the business does not understand its existing customers. While customer analytics is no longer new, there are dimensions unexplored. When customer journey is discussed, it is often limited to the first contact a consumer has with the business through a touchpoint. This is no longer the case. In the new reality, the customer journey began the moment consumers have needs.
Understanding how potential consumers navigate both the digital and physical world before they became a paying customer is vital. Knowing where the journey starts and what route led consumers to become valuable customers is extremely powerful. Big Data Analytics can determine the likelihood of purchases based on how far along the journey a consumer is. Not only that, it can also evaluate each consumer touchpoint in terms of effectiveness, helping businesses optimise their investments.
Better customer understanding will enable businesses to better communicate relevant offers to consumers in a highly relevant way – at the right place and the right time.
2. Detecting demand inception
Instead of predicting what consumers would buy next based on previous purchases, it is much more efficient to simply find consumers who are actively seeking for the product. This gave rise to new forms of marketing, Search Engine Marketing and Targeted Marketing. But this is only the beginning.
Because search engine is now the most common starting place of the any search, it is the most likely place where the earliest demand inception could be detected. However, there is a trade-off. Just because someone searches for a few car models on the web does not mean the person is in the market to buy. But if you can cross reference other behaviour, such as visiting a motor show, visiting car dealerships, in addition to web search, you can actually verify if the demand is real or is it a simple aspirational wish.
The earlier the demand is detected, the more chances there are for businesses to contact consumers and provide and tailor a highly relevant offer, just as the needs are being recognised by the consumers. This would enable a much more efficient supply and demand matching, delivering the right products to the right consumers as the needs arise.
3. Executing timely call to action
Now that a true customer understanding has been developed, and demand is detected, the final hurdle is to provide the right call to action at the right time.
A consumer looking to fulfil his or her need will only wait for so long before deciding on an option. Given that the consumers are fully understood in terms of what their needs are, what type of offers they love, where are the best places to connect with them, what channels of communication best resonate with them, timing of the call to action is still extremely important.
If you choose to communicate the right offer when the consumers are out enjoying themselves, likely the message will be buried under many other notifications, SMSs, and emails every one of us received on a daily basis.
But if the communication could be timed to pop up just as the consumers had finished browsing the topics and are about the start making comparison or decision, when they are actually on screen and see the communication, the chances of conversion is much higher. Strike the iron while it’s hot.
The world has changed, and it will continue to change
Needs and wants are infinite and ever present. In a world where smart phone will soon outnumber the population and everyone is always connected and consuming data, consumers will continue to search and compare for the best offer on the market. As the world moves faster with new technologies, consumers are more likely to choose the brands that is most relevant – tailored to their needs and presented to them at the time they wanted – at an increasing speed. A consumer can continue to be loyal, as long as businesses remain relevant to their needs.
New technologies have also enabled businesses to harness the power of Big Data Analytics to better stay relevant to their consumers and capture new opportunities of the digital age. The question is not if it is time for a change. The question is how fast can you change to stay relevant?
[1] The model was first introduced by Professor John Dewey in 1910 and further expanded by Engel, James F., Kollat, David T. and Blackwell, Rodger D. (1968) Consumer Behavior, 1st ed. New York: Holt, Rinehart and Winston 1968