How Can Advertisers face the new Paradigm Shift in Marketing?

I left this comment on one of my ex-work colleague’s blog this morning, and interestingly enough the topic discussed in one of my MBA sessions during the evening was on a similar theme I discussed in this comment.

No; it wasn’t about advertising, but it was a thought provoking session of class activity on “creative thinking”. And again, it was not the “artistic creativity” as discussed in my friend’s blog post, but rather about “Creative Decision Making”. The topic which hit me the most was the concept of Paradigm shift (coined by Thomas Kuhn in 1962) in decision making. So, I thought of adding something to my blog tonight, with some insight into my understanding of the whole idea of Paradigm Shift in Marketing.

A paradigm is a mental framework or a system, which draw a boundary around your patterns of thinking. It affects the decisions we make by large, and most of the time we tend to fear making decisions which contradicts with the paradigm we already believe in. Therefore, your thinking will always be just small increments to the existing status quo, and it will always be a step by step progress along a tested and relied upon method of doing things. You will never try to break the rules and explore something different.

As oppose to this concept of incremental thinking, the transformational thinking process is based on a new paradigm, or a different way of doing things. It replaces a well established framework and aims at complete renewal rather than small refinements. In the end, transformational thinking leads for what it called a “Paradigm Shift”.

To explain this in a simple example that we all could understand, think of the game of Cricket. During late 1970’s when Kerry Packer’s world series was a hot debate among cricket lovers around the world, Merve Hughes was listening to a team mates fascination about playing cricket at night. Merve responded saying “But it would be bloody dark at night! How could you see the ball?”.

In this example, Merve was a prisoner of the paradigm that “Cricket is a game played during the day”, while Packer was a Paradigm shifter, who brought a new paradigm to the game of cricket. During the early days of this paradigm shift, Kerry Packer faced a huge resistance from the paradigm prisoners who believed “Cricket is a game which should play over five days, during the day time”. But today, Kerry’s idea is strongly established as a new paradigm in cricket. Even the latest form of cricket; Twenty20 is merely an incremental change in Kerry’s paradigm, and not a new paradigm shift all together.

Coming back to my original point which I started off this post with, the same thing is happening these days in the field of Advertising. The entire concept of advertising is in the face of taking a whole new paradigm shift, where Marketers are now thinking of divorcing their long married partner “Advertising”. For decades, people treated advertising almost synonymous with marketing. Advertising firms thought, that they control the marketing budgets of their client advertisers, and expected that marketers will continue to spend millions in advertising for a foreseeable future. At the same time, they lost focus on what is they are expected to do with their clients money, and it became more of a “run for the Oscars” race for the agencies. All what mattered for them was number of awards they collected at ceremonies, and it was the only performance index they took for evaluating their success. To see what I mean, just check some of the internal and external publication made by some of the advertising firms, and read some of the interviews given to the media, by top executives at these advertising agencies. All they talk about is, the number of awards they bagged at last Chillies or SLIM awards.

But the marketers spotted the problem, and they now realize they are trapped in the paradigm of “advertising” and now they are looking at ways of getting out of the trap. Marketers, especially in the US are now realizing the traditional methods of advertising does not pay as much as they used to do during early 80’s. Now they are inventing a paradigm shift in marketing, where consumer engagement is set at the forefront of the marketing mix. At the early stage of internet, marketers went into it with the old “advertising paradigm” in mind, and treating the net as another “advertising medium” just like TV or Press, where you can place your ads next to content. But later they realized, the internet is not a selling media, but rather a buying media, where consumer dominates over the seller. They now are adjusting their rules to these new developments, and approaching the “marketing on the WWW” with completely a new paradigm in mind.

Now is the time for the advertisers to start thinking smartly. Instead of debating whether advertising is a “creative art” or an “industry”; now they have to think of how to re-enter into the pockets of the client companies, in this new changing environments.

Google said to be is having trouble in their advertising revenue growth during the first quarter of 2008, indicating clearly that companies are cutting their budget on advertising, and investing more on new methods of marketing like customer engagement, word of mouth marketing, and social media optimization. In such a situation, the old fashioned ad agency people should now think seriously about how to re-position themselves as “marketing solutions agencies” rather than being mere “advertising agencies”.