‘By invitation,’ 5G and other media & lifestyle trends for 2019
More consumer brands are following the lead of Netflix and Spotify in trying to encourage customers to see them as ‘a service to subscribe to,’ as well as a product to buy.
Overwhelming change is all over the place. You can consume content everywhere, and you can shop anywhere. These changes are driven by the speed of connection to your devices, the speed of handling and using available data, and the merging of various activities like entertainment, information, communication and play.
Carat, a leading media and communications company in the world, shares these 10 trends for 2019 that apprises marketers, communicators and business leaders about the latest developments and their implications.
Contextual commerce. E-commerce has traditionally been focused around destination sites like Amazon that are purely focused on shopping. The world may soon follow the example of China, where consumers are buying from apps like WeChat — services where people go to send messages, catch up with friends, and follow brands. Today, over 200 million people in China have input their payment details into WeChat. Users scroll rather than search, looking for inspiration within a category rather than for specific items.
This trend is most relevant for fashion and technology, especially low-cost impulse purchases that includes rapid delivery. Shopping becomes more social, easier for consumers to share notifications of a purchase, and even buy as a group. It’s easier to attach products to moments, targeting based on cultural events, and the best influencers will become sellers.
Experiential commerce. E-commerce is becoming experiential. Features like augmented reality and image recognition are allowing merchants to become more playful and introduce experiences to shopping, especially on mobile. Shopping technology company Shopify lets retailers make videos for customers to explore in AR (augmented reality) in their own homes. One example of this is the American bicycle company Pure Cycles. It is also being used to bring experiences to car showrooms, for example, by General Motors.
Snapchat has started to allow commerce through its AR filters. Domino’s Pizza was the first to use this, with an AR pizza box that linked through to an ordering page. Domino’s has now built AR into its own app. It has also entered into a partnership with Amazon, where users can shop for anything they can take a photo of, using image recognition. Smart speakers like Amazon’s Echo are also making shopping more of an experience, and they are now trying to get more brands onto the platform.
This trend allows brands to let customers try before they buy. It’s most relevant for products customers are less familiar with, and products that can be personalized or configured. It works well for expensive items, and if done well, it helps less technically savvy people shop with more confidence.
Games in messaging. This is entertainment as conversation. Snapchat’s Snappables are games that are played within the app using the camera and lenses. Dunkin’ Donuts is one brand that has advertised in these games. Snapchat is rumored to be increasing its focus on gaming, possibly driven by its part owner, Tencent. Facebook has created multiplayer games for its Messenger video chat, including “Don’t Blink,” which challenges people to keep a straight face. These are designed to liven up chats, but are not ad supported (yet). The inclusion of gaming in messaging makes it much stronger as a channel, commanding more of people’s time. As a medium, it is most relevant to brands with playful personas. Advertising is less intrusive as part of a game than as an interruptive message within a chat.
Life as a service. More consumer brands are following the lead of Netflix and Spotify in trying to encourage customers to see them as “a service to subscribe to,” as well as a product to buy. There is a distinction between the purely digital services and the physical brands creating a virtual service, but both types are trying to introduce more touch points and create a stronger relationship with the buyer. Over the past six months you have seen this model extend into previously unexpected categories. Nespresso has introduced a similar model for its coffee machines and pods. By paying a minimal amount for the machine and committing to membership and a subscription for coffee pods, customers are moving from buying a machine to buying a lifestyle. Uber and Lyft are both testing or introducing subscription models in the US, encouraging people to pay a monthly amount for many short rides, or even to protect them from paying surge pricing.
“By invitation.” Brands are encouraging their biggest fans to become even more involved by inviting them to have a deeper connection through their own apps, or private social media communities. Nike’s House of Innovation store in New York allows Nike+ members to call up and reserve stock, to be collected from special lockers. Joining Nike+ is free, but it separates the people who use their Nikes for fitness, rather than for everyday wear. Other brands are experimenting with private forums and “secret” Instagram accounts to give their keenest consumers a chance to get more.
The creation of a self-selecting “by invitation” community is most relevant to brands that are desirable, niche, cult, or used by early adopters. It is particularly appropriate for luxury brands, which can create a sense of scarcity and privilege. It is one way to turn fans into a channel and for them to become advocates for the brand. Once brands have found a small group of passionate fans, it is easier to offer benefits like personalization for them than for a larger group.
Smart out-of-home. Out of home advertising (OOH) is being revolutionized by digital screens. In 2018 digital accounted for more than 50 percent of OOH ad spend in the UK for the first time; globally it is projected to be just under 40 percent. Digital’s biggest advantage is being able to change the ad content rapidly, taking cues from the weather and other live data. Digital OOH starts to have more synergy with other media, particularly mobile. The new capabilities in OOH will be a big opportunity for clients with a large portfolio of brands, but also for small, niche brands that will be able to use OOH tactically for the first time.
Design from data. New products and services are being created and modified because of data being processed and analyzed at scale. Data is not just being used to optimize the campaign but also to create the product! Amazon’s 4-Star Store in New York features products curated from a list of items that have gotten four-star reviews on Amazon, guaranteeing that they are popular and of high quality. The rock band Metallica uses Spotify data to modify set lists when it tours. The band can see which songs are the most popular in each city, and make sure that they include them when they play. Metallica is using this data with Spotify’s full permission. Choosy, an American-Chinese fast fashion start-up, mines Instagram trends to take inspiration for its designs. By seeing which celebrity looks are the most popular (and getting the most comments like “Where can I buy this?”) they can quickly create highly sought-after pieces. Choosy is using this data without Instagram’s permission, but only using data that is in the public domain.
Targeting post-General Data Protection Regulation. GDPR has brought new challenges in how marketers use data to target customers with advertising, and has driven new ways of thinking. Media owners and ad technology companies are putting more focus on the context of the page on which the ad appears. Others are innovating around the content of the ads, making ads more relevant to the moments in which they are seen. Advertisers need to assess the value of context compared to the value of audiences. The New York Times, ESPN, and USA Today have created a way of analyzing a page’s content based on the emotion that a page is likely to trigger. They can then place ads that will work best when people are feeling those emotions.
Expanding connectivity. We are becoming used to fast connectivity. 4G, only introduced in 2010, now accounts for more than 50 percent of connections in developed markets. Faster connectivity is turning the world to video. More than 400 million Instagram users watch or create stories each day. A percentage of these are video, and video is also being incorporated into messaging apps, including group calling. The hot new app of 2018 is TikTok, a video-sharing app from China. Facebook has now developed its own version, called Lasso.
5G will be many times faster than 4G, and is coming soon. Many cities are trying it now before its launch in 2020. 5G connectivity will give people the ability to stream high-quality video, virtual-reality experiences and more without any latency or buffering. It will also increase the amount of meaningful data being collected from sensors in wearable devices, cars, and around cities.
Digital detox. Technology is becoming overwhelming, with content and commerce everywhere. People are trying to cut down on their screen time, especially their social media use, over concerns about health and wellbeing. Global Web Index found that 19 percent of those surveyed in the UK and US had been on a digital detox, and 70 percent had tried to cut down on screen time. Concert halls, restaurants and bars are experimenting with banning phones to encourage people to enjoy the moment, not live life through their screens.
Facebook, Instagram and YouTube are introducing tools to let people be more aware of the time they spend with the services. These tools allow you to see time spent, and set alerts to remind you to put your phone down. Brands need to help their customers have more meaningful connections with their peers. This is especially relevant to brands with an interest in wellbeing, like fast-moving consumer goods, and even socializing, like alcohol companies. “Detoxing” will increasingly be a creative route: “See real life, not a filter.”
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