Earlier this year we were asked by Wharton to contribute to their initiative “Advertising 2020” (a book and a companion online platform to be published), part of their Future of Advertising Program. They asked for answers to two questions:

1. What could / should advertising look like in 2020?
2. What do we need to do now for this future?

This is an extended version of our contribution to the initiative, which we’ve broken into a series of posts. Today’s Part 1 is an introduction looking at the cultural context and our first thoughts on the implications for advertising. Subsequent instalments to follow over the next couple of days.

“Life is just a premonition of a flashback.” ~ Nick Gill, after Steven Wright

At BBH we don’t much like making predictions. Fundamental human motivations don’t change and actual behaviours change a hell of lot slower than we’d like to think: mankind may be programmed to progress for better or worse, but “behavior is just motivation filtered through opportunity”, as Clay Shirky so neatly puts it.

Nonetheless, sitting here in 2012, it seems unimaginable that technology and media will do anything but continue to evolve at pace, nor does it seem likely that the dominant influence of those two industries over advertising will falter. So, deliberately, we’ve sought out and included as part of our submission a few words of advice from people working at the cutting edge coal-face of those industries.

The cultural & technological context

Moore’s Law tells us that a lot can happen in eight years. Let’s just go back the same period to 2004: YouTube didn’t exist and if someone had asked you if you’d heard of (the then newly minted) Facebook you’d have been forgiven for shaking your head. It’s impossible to look forward without acknowledging the significance of the changes brought about in the past decade in particular. As Mary Meeker concludes in her KPCB Internet Trends report out earlier in 2012: “this cycle of tech disruption is materially faster and broader than prior cycles”.

And, as with every single period in history when the pace of technological change has accelerated, we are feeling its impact in culture today:

“As the train hurtled onward, its passengers sometimes felt the pace foreshortening their sense of their own history. Moore’s Law had looked simple on paper, but its consequences left people struggling to find metaphors with which to understand their experience.” ~ James Gleick, “The Information – A History, A Theory, A Flood”

Flash forward to 2020 and the pace of that change is unlikely to have slowed, but the shake-down in broader culture will have passed, as a generation who took the Internet for granted as children reach their thirties. If words like ‘social media’ and ‘mobile’ already sound quaint today, by 2020 they’ll sound antiquated. Market forces will have evolved and the questions we’re wrestling with today (our collective obsession with the value of time spent ‘online’ versus ‘offline’, for example) will have been answered and forgotten. Gen Ys and Zs already can’t see what the fuss is about, in fact.

Where might this leave advertising? The graph below that we’ve generated using Google Trends shows a decline in worldwide interest in ‘advertising’ (blue line). Search is just one data point, but it suggests advertising today is, well, becoming less salient in people’s lives.

Source: Google Trends

Driven by a perfect storm of media fragmentation, the social web and economic pressure? Probably. Yet worldwide interest in ‘brands’ (red line) has grown steadily over the same period.

Perhaps it’s simply the case that advertising as we know it has begun to shapeshift out of all recognition, bearing the threads of what may define it in 2020.

What follows here is a cautious examination of some of these threads, where they may take us eight years hence and what we can do now for this future.

8 years, 8 future opportunities, 8 things to do now.

#1 Marketing as Profit Centre, not Cost

“If you want a golden rule that will fit everything, this is it: Have nothing in your houses that you do not know to be useful or believe to be beautiful.” ~ William Morris, (1834-1896)

The ongoing shift from linear and one-way to non-linear and two-way – in short to more ‘interactive’ marketing – is well-documented. And if the profound disruption caused by this weren’t already obvious to every advertiser in 2012, it certainly will be by 2020.

Why is this shift set to continue?

Occasionally, extraordinary marketing activity can succeed in driving culture, skipping briefly ahead of existing user behaviour. Truthfully though, it is most often the other way round: marketing efforts follow the behaviours of their audiences.

In May 2012, research by the BBC in the UK confirmed what we could all sense, that the old 1:9:90 rule of digital participation was outmoded, with 77% now actively engaged online:

Again, if history teaches us anything, it is that marketing will follow user behaviour. So marketing efforts will shift in response, becoming increasingly interactive and participative, not less.

As the impact of this grows, it follows that truly effective marketing will need to be so useful or entertaining that people choose to have it in their lives.

Anything less than this will be ad-blocked or ignored: silently downgraded, dismissed from people’s streams by the 2020 equivalent of Google’s Panda, Penguin or Facebook’s EdgeRank. These algorithms already punish brands today for anything that isn’t regarded by users as unique, useful or entertaining. They have to: the future of their own platforms’ livelihoods are at stake.

And, once brands are in the realm of offering something truly useful or entertaining in marketing, why not strive to create tools, apps, content, stories etc that a user in fact will pay for? OR at least collapse the increasingly outmoded separation between consideration (the traditional preserve of advertising) and conversion?

Vital as it is to understand the thought process a user may go through, we know the neat separations between awareness, consideration, trial, conversion are already blurred in many categories. The very term ‘user journey’ implies a prolonged process. Yet increasingly we know we’re seeing and downloading a sample, liking and buying it, all without leaving the sofa (or bus seat, or desk).

‘Marketing that people would pay for’ may sound absurd when you first hear it, but witness early, trail-blazing examples like Nike+, Burberry’s Art of the Trench and Burberry Live and ASOS Urban Tour. These are not ad campaigns as we know it. They began life as a marketing cost, but became bona fide revenue and profit centres.

All we need to remember is that participation demands effort from the user. And where there is effort, there must be at minimum a reciprocal level of reward (we like reminding ourselves of BBH Creative Director Dom Goldman’s standard reaction when he sees an idea that asks for a lot, with not enough payoff for the user: “That’s a long way to go for a ham sandwich.”)

In short: it seems likely that simple, targeted display and broadcast advertising will still exist in 2020 to drive awareness of promotions and new news, but it strikes us that other forms of ‘advertising’ will need to obey the changing rules in media and technology consumption.

One thing to do now: consider how marketing might act as ‘brand service.’

In short, what might people be prepared to pay for and can our brand credibly deliver this:

Can our brand be a filter for the firehose of information in a relevant category, or can it break the filter bubble to provide greater abundance?

Can we add a layer of enhancement or can we help strip complexity away?

Can we help speed up a dull, slow experience or find ways to prolong a positive one?

Can we act as coach or are we better suited to enabling peer-to-peer advice?

Self-tracking, aka The ‘Quantified Self’ movement, offers some food for thought here, particularly for brands in Health, Sport, Food & Drink, Finance, Life Skills and Productivity. A plethora of applications and products – Fitbit, Swimtag, Nike+ Fuelband (Nike+ Kinect Training coming soon), Adidas MiCoach, Lumoback.com, Mint.com, Audi e-bike Worthersee, Mood Panda to name a few – all use sensors in our smartphones and other wearable devices to track a particular activity. All that data helps a user to chart, compare and share their progress, the intention being to improve performance over time.

These self-tracking tools could go further in a brand’s hands: stimulating brand loyalty, initiating competitions and promotional activity amongst users, even rewarding users who behave more frugally, healthily, ethically. Recent research conducted globally by the Future Foundation indicates a growing interest in self-tracking, particularly amongst younger audiences with, for example, 40% of 16-34 year olds stating they ‘would like an app or device that tracked calories or nutritional value of food.’

Again, the starting point needs to be a straightforward understanding of the brand’s role in peoples’ lives, together with clear terms and conditions with respect to privacy around data collection.

Once those principles are in place: start acting like an entrepreneur: what relevant problems can we solve? what opportunities can we create?

Next instalments:

Part 2

#2 Everything is Connected: The Rise of the Networked Brand
#3 Mobile Ubiquity

Part 3

#4 Everyone’s a Producer
#5 Content Marketing: brands as content owners & partners
#6 Win-win-win Platforms

Part 4

#7 Big Data, Big Patterns
#8 Expect a Creative Renaissance