Those two shallow, transactional value exchanges, in the not so distant past, fairly framed the simple, straightforward relationship between brands and their customers. But consumers today—particularly younger ones—expect and demand more. They want more from the companies they engage with than the simple delivery of even the most life-changing products and services. They don’t just want to buy from a brand, they want to invest in it. They don’t just care about the benefits a product brings them; they care just as much about the benefits it brings to society.
To meet the public’s heightened demands and expectations, companies today need to be and do more. What they need to be is more relevant to customers, along the crucial dimensions of meaning, purpose, values and vision. What they need to do, sooner rather than later, is forge an entirely new transactional contract with consumers.
Sounds simple, right? It’s not. There is a barrier to “better,” and that barrier is Big Tech.
It is not just money, though, that makes a monopoly. The bigger problem is that the dominant digital platform model that Big Tech uses represents a fundamental mismatch between the value they derive from the day-to-day gusher of data generated by their billions of customers, and the value to those customers—that means all of us—of the products and services they profess to provide for free.
First, let’s look at the one and only way tech firms have ever found to make any real money off of that gusher of data: advertising. But this is, as we all know, not your or my father’s advertising. This is a hydra-headed Babylonian beast called “programmatic advertising,” based on the algorithmic methods you can employ at practically no cost when you are a Big Tech firm that has continuous and unfettered access to just about everything any of us says, does or even thinks on the internet.
What the companies offered the big brands—their advertisers—was the same value proposition that they offered their customers: fast, easy, simple, seamless, frictionless, highly-targeted and effective ways, or so they claimed, to enable brands to “find” their current and prospective customers where they live and spend time online. The pernicious result has been that marketing has turned into tracking, which is the main way the Cookie Monster pursues its prey.
The public didn’t see this Big Tech surveillance coming, and it is a system that callously treats customers as the product.
Big Tech and the brands which rely on them to market to consumers, are ruthlessly hoarding and exploiting reams of customer data as if it were their own, and not their customers to control. In doing so, they are accelerating their own demise. As more consumers peer past the cynical façade of frictionless convenience, they are finding less to like about brands that stand for little other than seamless, frictionless product delivery. A new breed of customers is actively seeking a new kind of company, one based on a dramatically different model. I called these “interaction field” firms.
“Interaction field” enterprises intelligently leverage digital technologies in new ways that transcend the old, cold connections to consumers and customers. They create a 21st century version of store-on-the-corner customer intimacy by fostering unprecedented levels of loyalty, trust and belonging, based on a shared sense of real and perceived value, and values.
Take, for example, Nike and me. I am a runner who has long used their apparel, as well as their app and digital platform to track my progress and prowess, relying on its precise measurements and benchmarks telling me how I am doing today relative to peers. The value I get from this app has deepened my trust, and frankly, my admiration of Nike as a friendly and responsible firm. As a longstanding and loyal member of and active participant in Nike’s flourishing and magnetic “interaction field,” I never feel ripped off by the fact that I send them my data. I’m happy to do it. It makes me feel good. Because it makes me run faster and better. It’s a real and enduring value exchange, and a welcome clause in the new consumer contract.
But that personalization and customization is just the beginning of a value exchange that starts with the customer, and eventually expands to encompass all of society. The virtuous cycle created by companies like Nike—or Peloton and Tesla, to name two other prime examples—can be seen as a welcome and belated antidote to the entire digital landscape, riddled with distrust and disgust built up over the past several decades. So while a tiny vanguard of interaction field companies has emerged, much needs to be done. The system we build needs to embody an insight that Alan Mulally, the former CEO of Ford, once shared with me, which has stuck with me ever since: “Marketers try harder to be understood than to understand.”
Companies that get it, get it. Or, to paraphrase Paul McCartney as influenced by Albert Einstein: “The value you take should be equal to the value you make.”
Erich Joachimsthaler, founder and CEO of the global brand strategy and business transformation firm Vivaldi, is the author of The Interaction Field: The Revolutionary New Way to Create Shared Value for Businesses, Customers, and Society, PublicAffairs 2020.
The views expressed in this article are the writer’s own.
