Issue № 87 | London, Sunday 3 March 2024
Last week I told you that we’d reached the tipping point for artificial intelligence.
This week, with Nvidia becoming only the 3rd stock to ever close above a $2 trillion valuation, Microsoft striking a deal with French AI firm Mistral, and Apple giving up on a decade of working on its car in favour of AI, it seems everyone else agrees. But as an IMTW reader, you’re rightly asking, what impact will AI have on marketing? Like elsewhere, to a large extent AI’s usefulness to marketers will depend on the skill of the person prompting it. In the beginning at least, it will be most valuable in speeding up the mundane, freeing us to spend more time being strategic and creative. That alone makes it worth looking into.
That’s why, starting with today’s issue, you’ll find a new section dedicated to showcasing some of the genuinely useful AI tools - many free - already available to marketing teams. You’ll find ‘The AI spotlight’ below, just before ‘Off cuts’. I hope you like it.
👉🏻 Now, read on to learn why:
① Marketing is unique in depending on a mix of art and science.
② All your marketing should be measured by how it contributes to growth.
③ Your pricing should be as simple and transparent as you can make it.
④ AI will take time to be useful and will require human operators to optimise it.
⑤ Social media was only ever one tactic; others include partners and events.
⑥ Now is the time you definitely should be using business cards.
⑦ Successful investing is a hot mess of contradictions.
What's new
Transformation consultant and adviser Tom Goodwin wrote a LinkedIn post this week bemoaning the difference and lack of understanding between ‘traditional’ marketers and ‘growth’ marketers.
In short:
“There are brand/traditional marketers. They pray at the alter of people. They focus on empathy, understand the magic of a great idea, appreciate and respect the sheer oddity of people and the crazy way people behave. They think of marketing like an orchestra, there are instruments and scores and tempo and a conductor, and they feel our way to great music with a passion. They think companies and brands need a vision, and a strategy and this should guide all decisions. They believe in seduction and persuasion and a degree of myth and haphazardness. They believe attribution is a fools errand.”
“There are digital marketers. They pray at the alter of real time dashboards. They see marketing as growth. As a tool to endlessly bring in new users ( not customers) They have a love of numbers and logic, and above all else optimisation. For them marketing is a system, a workflow, a process to tweak, like a formula one cars pitstop, it’s just tasks in an order. For them the dream of marketing is to have made the most effective tech stack. One that produces the best outputs. They believe attribution is the lifeblood of good optimisation.”
“We do have periods where we favour one over the other. When the reality is that both ways of doing marketing have an enormous amount to learn from each other. We tend to do especially badly at recognising the brilliance and value the other side brings. We will always find it hard to combine two things that seem so culturally different, realistically one ‘hand’ will always be strong than the other.”
Why it matters
Tom is smart and I find the great majority of his writing thought-provoking but I think he’s wrong about this. Or at least he does ‘traditional’ marketers a disservice. In my experience, great marketers understand that all marketing is ultimately always about growth. There simply isn’t any other reason to do it.
That’s a reality that is being reflected in job titles too, with some CMOs transitioning to being chief growth officers (the FT reports this week that, in the UK, the biggest growth in jobs with the title ‘chief’ in recent years has been ‘chief growth officer’).
Good marketers understand that they are there to serve the commercial objectives of the company. They also understand that there are a multitude of ways to achieve it and that working together seamlessly, not facing off against each other, is the best way. Indeed, this week HBR argued that organisations should involve all stakeholders — including those who will need to execute the growth strategy — in its conception and development.
① Marketing is unique in depending on a mix of art and science, creativity and analysis, experimentation and best-practice.
What to do about it
Take action
It’s a good idea to audit your marketing activities regularly. The nature of the work means that tactics have a habit of morphing and proliferating and pretty soon it’s not clear why you’re doing all the things you’re doing.
② All your activities should be framed in terms of outcomes and those outcomes should be measured by how they contribute to the company’s growth. But, in so doing, it’s important to remember two factors:
Source
Growth can come from new customers (measure acquisition) but it can also come from persuading existing customers to spend more (measure retention and share of wallet). And never forget that profit growth can also be driven by cost reductions and increased efficiency. This is all growth and marketing can and should play a key role in delivering it.Time
Broadly speaking, it’s useful to think along three timeframes and to understand that different tactics will deliver for each.Short term: Lead generation campaigns, advertising, crisis communications
Medium term: Messaging, positioning, public relations, social media, events
Long term: Brand, content marketing
These are all marketing activities. And they should all contribute to growth. But they’ll do so along very different timelines.
Get help
Join the InMarketing community on Substack (you’ll need to download the Substack app and head to the chat tab) to ask questions of me and fellow senior marketing practitioners.
Help me
If you found this useful or know someone who would, please share it. Every time you do, it helps me grow the community of regular IMTW readers.
Top stories
The other articles that are worthy of your time.
FINANCE
The fee fiasco weighing on St James’s Place
③ Your pricing should be as simple and transparent as you can make it.
“As the share price of St James’s Place began to plummet by almost a third on Wednesday morning, shareholders could have been forgiven for feeling a sense of déjà vu. For the third time in less than 12 months, an earnings warning had sliced a significant amount of value off the FTSE 100 wealth manager. This week’s slump was prompted by a surprise £426mn one-off provision related to potential client refunds. This pushed SJP to a pre-tax loss of £4.5mn for 2023, down from a pre-tax profit of £504mn in 2022.”
“SJP’s advisory fees had been widely criticised as opaque and complex, and for fuelling lavish staff rewards like cruises and company-branded cufflinks before an overhaul of pay and perks took place in 2020. SJP does not even know the number of clients to whom it may have to pay out. The £426mn provision was based on a ‘statistically credible representative cohort’ of clients. Earlier this month, the FCA warned advice firms it may crack down on customer charges, and requested information from the 20 largest companies in the sector, to allow it to decide whether to take further regulatory action. That could ultimately include fines for companies deemed not to have treated customers fairly.”
“Wealth managers in the UK charge clients for providing financial and tax advice, and for managing investment portfolios. Typically, clients will either pay a one-off fee, an hourly rate, or a recurring fee for a relationship with an adviser. Some 77 per cent of revenues in the advice sector come from these annual charges, or ongoing fees. For clients of SJP, who also pay an upfront charge for advice, these ongoing fees are typically 0.5 per cent of all assets. This covers the cost of the relationship with the adviser, which can include services such as an annual review to ensure the initial advice given remains relevant. The issue SJP has is that before the introduction of new IT software in 2021, there are gaps in its record-keeping, and for some clients it is unable to prove whether it had provided the ongoing services they were paying for, for instance an annual review.”
TECHNOLOGY
How businesses are actually using generative AI
④ AI will take time to be useful and will require human operators to optimise it.
“Last year Jamie Dimon, boss of JPMorgan Chase, said that the bank already had ‘more than 300 AI use cases in production today’. Capgemini says it will ‘utilise Google Cloud’s generative AI to develop a rich library of more than 500 industry use cases’. Bayer claims to have more than 700 use cases for generative AI.”
“This ‘use-case sprawl’, as one consultant calls it, can be divided into three big categories: window-dressing, tools for workers with low to middling skills, and those for a firm’s most valuable employees. Of these, window-dressing is by far the most common.
Amdocs produces software to help telecoms companies manage their billing and customer services. The use of generative AI, the company says, has reduced the handling time of customers’ calls by almost 50%.
Sprinklr, which offers similar products, says that recently one of its luxury-goods clients ‘has seen a 25% improvement’ in customer-service scores.
At Nasdaq, AI helps financial-crime sleuths gather evidence to assess suspicious bank transactions. According to the company, this cuts a process which can take 30-60 minutes to three minutes.
Allen & Overy teamed up with Harvey, an AI startup, to develop a system that its lawyers use to help with everything from due diligence to contract analysis.
At Bank of New York Mellon an AI system processes data for the bank’s analysts overnight and gives them a rough draft to work with in the morning.
Microsoft’s GitHub Copilot, an AI coding-writing tool, has 1.3m subscribers. Amazon and Google have rival products. Apple is reportedly working on one.
Fortive, a technology conglomerate, says that its operating companies ‘are seeing a greater-than-20% acceleration in software-development time through the use of gen AI’.”
“Generative AI is also generating new types of white-collar work. Companies including Nestlé and KPMG are hiring ‘prompt engineers’ expert at eliciting useful responses from AI chatbots. One insurance firm employs ‘explainability engineers’ to help understand the outputs of AI systems. A consumer-goods firm that recently introduced generative AI in its sales team now has a ‘sales-bot manager’ to keep an eye on the machines.”
MEDIA & MARKETING
Sam Sloma: Why an online presence is no longer a must have for business
⑤ Social media was only ever one tactic; others include partners and events.
“There are many businesses thriving without anything online. Old-school relationships, going to see people in person, going for coffees or picking up the phone are being forgotten or disregarded in favour of posting on LinkedIn and hoping you can build an audience.”
“We have recently gone back to basics in our marketing efforts. We’re focused on building stronger relationships with the accountants who already refer us and like what we do. There is plenty of juice left to squeeze here and they provide us with warm-client referrals who fit our niches exactly. They know who we are, what we do and who we like to work with, and provide us with those people accordingly.”
“I am becoming more and more disillusioned with what I see on Twitter and LinkedIn, and feel these things are becoming more of a distraction than they are a help. It seems we’re trying to be impressive on these platforms, as opposed to being ourselves. We’re trying to fit the narrative when in real life we don’t need to. We’re growing, we’re building real-life relationships away from the digital and it feels so much better.”
WILDCARD
Death of the business card
⑥ Now is the time you definitely should be using business cards.
“The once-vital business card looks set to become a thing of the past in the UK after new survey data revealed a sharp decline in their use. More than half of those who have previously used cards have given up their use since the beginning of the pandemic, the survey, conducted by Ipsos.”
“Fewer than 15 per cent of those of working age under 34 have ever doled out an 85mm by 55mm piece of card with their name and number on it – a dramatic shift from the days when business card holders were a must-have office accessory.”
“Of those who have previously used business cards, 52 per cent have not given one out in over four years. 23 per cent of people that have used them have done so in the last 12 months. 65 per cent of current users said they were very or fairly unlikely to use them in two year’s time.”
The Artificial Intelligence Spotlight 🔦
Taplio: Leverage AI to grow on LinkedIn
Gamma: Create a working presentation, document or webpage in under a minute
Slogan Generator: Summarise your marketing in one sentence.
Off cuts
The stories that almost made this week’s newsletter.
FINANCE
💍 Waverton to merge with London & Capital
👮🏻♂️ FCA under fire for ‘sinister’ plans to ‘name and shame’ firms
💰 HSBC wants to pay top brass Wall Street salaries
📉 Citi’s investment banking market share drops to lowest level since 2000
👏🏻 Emma Hagan appointed ClearBank UK CEO
TECHNOLOGY
🪙 Will stablecoins battle tokenised deposits?
🇫🇮 Finnish fintech secures UK e-money licence and appoints ex-Tide boss as chair
🇺🇸 Federal Reserve explores the impact of CBDC on dollar dominance
🇭🇰 HSBC HK eyes expanding tokenization efforts to wealth clients
⛓️ Lloyds is first UK bank to join WaveBL blockchain bill of lading network
MEDIA & MARKETING
⛏️ Visa’s marketing chief on the creator economy ‘gold rush’
📰 How the media industry keeps losing the future
📺 Why Martin Sorrell is investing in CTV buying platform tvScientific
🎙️ How to achieve business podcasting success (and pitfalls to avoid)
🇪🇺 Meta faces European complaints over ‘gargantuan’ data collection
The last word
⑦ Jacob Rothschild, who died this week, on successful investing:
“You need two approaches, perhaps contradictory, to be a good investor: on the one hand extremely cautious and cynical, but on the other you have to be brave and to take risks.”
Don’t settle for marketing.
Strive for InMarketing: innovate, interact, influence.
Wishing you a productive week,
P.S. I wouldn’t flag it to you unless I’d already managed to secure a table myself but my favourite restaurant in the world is finally reopening. #NotLeCaprice