By Elizabeth Cherian, Wunderman Thompson
Known as the SXSW of Europe, Web Summit is annually hosted in Lisbon, Portugal, and the largest tech conference in the world. This year’s event pavilions were heaving with more than 70,000 global attendees, all clamouring to catch the next big thing as everyone from Amazon to Facebook to Huawei took to the stage. Over the course of four days, some of the most intriguing and provocative thought leaders in the marketing and advertising space outlined their vision of the future, including ex-WPP CEO and founder, Sir Martin Sorrell, Wunderman Thompson’s Global CEO, Mel Edwards, and a variety of management consultancies all touting for our business. Here are two big ideas from the conference not to overlook.
The Next Frontier of Marketing
Virtual environments were a hot topic at Web Summit. Many are wondering how they can get a piece of the pie. Gaming alone brings in an annual revenue of $150 billion – bigger than the film and music industries combined. Events like The League of Legends World Championship draws in more than the Super Bowl, while Fortnite has hosted the most attended musical concert in history. Not just for esport enthusiasts, virtual environments are increasingly becoming a place where consumers spend their time, and as a result, seen as the next frontier of marketing.
The advancement of a host of technologies is driving this increase in consumer interest in virtual worlds, including AR, VR and 5G; which was described by Nokia CTO, Marcus Weldon, as “transformation to human existence” in his talk, “Why 5G will Change Everything.” The network provides lightning quick processing power – 800 megabits/sec – which allows us to spend more time comfortably in digitally rendered environments.
Another technology spurring innovation in this space is RT3D, or real-time rendering in 3D, which produces graphics for video games and other interactive digital spaces. Leading the charge for making this new technology mainstream is Unity Technologies. Their CMO Clive Downie outlined at Web Summit two key advantages for brands. One is speed. RT3D has drastically accelerated the time it takes to render in 3D. Disney produced a CGTV animation for its app Disney Now in 1/8 the standard time – think of the production costs saved. The second benefit is visualization. The tool instantly displays graphical changes, a perk that can be employed not only by design but also marketing. Volvo used RT3D to show prospective buyers how design choices could personalize a new model.
It’s still early days for these technologies. Everyday consumers will rely on 5G to move seamlessly between real and virtual environments, and Weldon admitted that it will be another 3-4 years before it’s mainstream. Yet the trend is still moving towards more people spending more time in virtual environments, whether they be for gaming, shopping or entertainment. Marketers should be thinking now about how they want to position themselves beyond this new frontier.
The Next Wave of Influencer Marketing
There was a raft of talks forecasting the future of influencer marketing. Everyone from Burberry to Saatchi to influencer.com was weighing in on the discussion. While celebrity influencers are currently fetching as much as $500k per post according to Mediakix, a growing lack of trust is challenging the model. Analytics firm HypeAuditor investigated 1.84 million Instagram accounts and found more than half used fraud to inflate the number of followers.
In addition to putting off advertising by exaggerating reach, influencers are turning off consumers by promoting products they don’t use. Their engagement rates are on the decline, dropping as much as 3.5 percentage points since 2018, according to InfluencerDB. To address this shift, a panel entitled, “Democratising Influencer Marketing”, looked at the rise of micro influence where niche taste, an authentic voice and dedicated following hold the most value.
Founder Bonnie Takhar of the UK social commerce platform, LetsBab, explained that the shift is “not about broadcasting but more about collaboration and advocacy.” Her startup matches brands with every-day brand ambassadors who are paid a 5% commission when someone in their network makes a purchase based on their recommendation, thus rewarding modest influence in a transparent way.
Fellow panellist and Burberry’s VP of Digital Marketing, Rachel Waller, saw the key task for brands as defining their values and empowering their consumers to advocate on their behalf. By doing so they build “one world of influence” where every voice matters. As influencer marketing matures we will see a move away from the pyramid of influence model. Marketers should be thinking now about how they can build their own world of influence – one rooted in authenticity and collaboration.
Elizabeth Cherian is European director, Wunderman Thompson Innovation Group.