In New York’s Central Park recently, an old man was selling “Banksy paintings” for $60 apiece. His booth was right next to others selling everything from second-hand books to flowers, fruits and vegetables, as well as other art posters.During the entire day, only three paintings were sold, but what looked like any other booth turned out to be another provocative stunt by the artist Banksy himself. The works of art were real and their lucky new owners had snatched a bargain worth tens of thousands of dollars.
This stunt illustrates the essence of marketing: the difference between perceived value and real value. In the advertising world, we work to build perceived value and tell people why product X is worth more elevating its appearance or its basic product attributes.
Today, people’s brand loyalty is still somewhat high, but it’s rapidly losing ground, as illustrated by Havas’s study, Meaningful Brands, where two-third of consumers across markets said they don’t care whether the majority of brands survive or not. We’re fast moving towards a world where shouting loudest just won’t cut it anymore.
When did you last make a big purchase without doing a quick search online? Or posting a Facebook update: “Any good recommendations for a travel company to Vietnam?” The transparent market is making our purchase decisions more conscious and that’s good news in terms of sustainability, as well as for companies delivering real value (or shared value) rather than perceived value.
Price and quality no longer stand alone
In a transparent market, products and services are increasingly quantified and compared on a multitude of parameters. Price and quality no longer stand alone; social, environmental, health and other value-added factors are put into play from the supermarket shelves to the global stock exchanges. This puts unprecedented pressure on brands that are engaging in business-as-usual rather than preparing for a new, sustainable marketplace.
The online clothing store Honest by has chosen to be open about even the smallest details in its production, as well as about its products’ social and environmental impact. However, it has taken it one step further by showing, for example, exactly how much it pays for each material going into a pair of shoes and how much everyone earns. Just five years ago, this would have sounded ludicrous. Today, it makes good business sense.
A new market battle between doers
The sporting giants Puma and Nike are engaged in an innovation battle, trying to outperform each other in minimising their resource usage while delivering outstanding performance products at the same time. It’s a war on doing rather than saying.
From Puma’s InCycle collection, which shows the environmental costs in dollars on price-tags, to Nike’s ground-breaking FlyKnit shoes, rethinking how a shoe is made and using as little material as possible – we are seeing how the race to fast becoming one about how to make a difference for people and the planet. The sustainability thinktank the B Team, supported by business gurus such as Richard Branson, announced a more transparent market as one of its main priorities for creating a level playing field.
It’s what you sell, not what you say
The increasing amount of information that is readily available in more and more aspects of our lives, is pushing the frontiers further. We have gone back to what we really sell. In a transparent market, the truth cannot be distorted or decorated.
Personalised data means better-informed decisions overruling emotions and intuition; helping consumers towards their ideal way of living. Whether it’s healthy life spurred on by the Nike Fuelband or offering your children the most nutritious food. Information delivered by expert recommendations like GoodGuide, real-time comparisons like PriceRunner, consumer labels like the Energy Label or peer-to-peer consumer recommendations will (and already are) adding more transparency to choices than ever before.
New technologies will take this information and make it increasingly accessible. Think of Google Glass or intelligent shelf displays recommending you products based on your known preferences– who knows what the future will hold?
Democratic marketplace, democratic society
In this rapidly transparent society, brands need to embrace a radically-changing world-order or be exposed as nothing but screaming quacks selling snake oil – destined to be chased out of town.
Tomorrow’s success stories are brands that strive to deliver exceptional value through service and product – and isn’t this in reality what the capitalist society is all about; a competition that improves services and products, propelling us forward, rather than a beauty contest based on incremental or advertised made-up differences, which leaves us stagnating? The market is becoming democratic, and isn’t this what we should aim for in a democratic society?
This blog post was originally brought in The Guardian