The New Active Consumer, Paradigm Shifts and their Impact on Success Strategies

As usual, there is a huge buzz around change especially given the context of the recent economic recession. Like always, this time around as well, most organizations are slow to react. The Managing boards are nearly always skeptical and perhaps rightly so and hence like to take it easy with change! Professor Nicholas Nassim Taleb, conclusively proves in his extraordinary work “The Black Swan”, that predictability is much better in retrospect!! And, like the cliché goes, Change is constant!!


Think of an answer the following question without straining yourselves! What was the front page solus advertisement in your favorite newspaper today?! If you can recall, be proud of yourselves, for, you are among that minority of the readers that save the advertisement industry their blushes.

And, delving a little deeper, Will you use the product? If yes, will you like it and become a loyal user? If you do become a loyal user, will you become a zealot read “Brand Endorser” who recommends the product? The more you keep answering in the affirmative, the more your tribe keeps getting exclusive. We could do this exercise for the other traditional mediums and end up with similar results. So while companies are spending their millions on traditional forms of advertising, the returns may not be something to write home about.

Does that mean traditional advertising as we knew it is over? Well, in isolation it is! But when you look at traditional advertising as a piece of the jigsaw to solve the consumer puzzle, it has utility that cannot be denied or defied!

Alright so with that piece of good news let’s scan the environment in which we operate and see if the paradigm has shifted any?!

Financial Paradigm: When Lehman Brothers (the company) breathed their last, it signaled a change that few of us can forget in our lifetimes. The recession that followed saw many huge and established players biting the dust. How effortlessly can corporations fall, was never demonstrated with such élan in the past. Also how Public money could be transferred shamelessly into the private domain and how the bonuses grew while the businesses perished was also exhibited by the key stakeholders of these big MNCs.

Information Paradigm: Information has undergone transformation. New planets have taken over the cyberspace.3G, SNS, Blogs, DTH, Web 2.0, Intranets. Business at the speed of thought could well be a reality sooner than later.

Knowledge Paradigm: Apart from the information transformation, new research and research methods backed by super software and powerful computing have boomed the Knowledge arena. Just to prove the point, think Neuromarketing, Pheromones, Effect of Colors, Mirroring, Blink, Tipping point and the Black Swans. And all of this is almost post 2000!

Consumer Paradigm: The consumer has changed. Latest research from Mc Kinsey which covers Japan, Germany and US consumers across various categories shows that the Consumer decision journey has changed. All of us are aware of the funnel shaped linear consumer decision journey. The new research shows that the process is circular and is definitely not funnel shaped, meaning the brands under consideration do not necessarily narrow down. Instead at the second stage they may increase. This is because the present day consumers are active in seeking information rather than passive waiting for marketers to reach them. The research also points out two various kinds of brand loyalists, active and passive ones. The passive ones are open to buying other brands as well.

Impact on success strategies: A lot has changed contextually w.r.t Branding. Marketers have to address an empowered active consumer base in an increasingly competitive environment. Hence the fact that some practice has continued for the last few decades, does not justify its continuation any more. Smart Brands will differentiate based on consumer experiences.

Smart branding will be based on more on functionality and relevance. Organizations that can build a direct line of sight to the consumers for all employees will continue to be successful. Brands that will learn to be strategically tactical will move north-east with time. Smart organizations shall fight their battles in the back drop of strategic snapshots in various geographies, segments etc.

Companies will have to build and execute relevant experience for the Consumers at the various touch points (Company Driven Marketing, Consumer Driven Marketing, Point of Purchase, and Post Purchase Experience)

And no matter what and in which age; Consumer Value will always drive share holder value!