Brandon Schauer: In the past you've been one to talk about the changing role of design -- in your professional work, in your presidency at the AIGA, and in your writing. It seems that you're running towards that again with your new role. Can you tell us what are you running towards?
Clement Mok: I'm running towards that very quickly. But first, let's back up. I had the luxury of spending some time at AIGA and really understanding the nature of the design profession and its practice; understanding the design profession's shortcomings and understanding what it needs to be when the profession grows up. In many ways, the practice of design is really about enabling and giving form to ideas. It doesn't matter what forms and what media the ideas come in.
So, what have I been up to? I was strangely attracted when Sapient asked me to look at the massive change that's going on in the media and in the marketing spending of companies. When I started to investigate this almost two years ago, there was just an inkling that marketing spending was shifting away from the large, traditional broadcast media: television, radio, and print. The question Sapient asked me was, "If that money is being spent elsewhere, then where is it being spent, who's doing the work, and can Sapient take a cut of that spending?" Sapient had a suspicion that this change in the amount of spending was a huge number.
The marketing and advertising industry is a $230 to $250 billion industry - and that's being conservative. IBM, which accounts for everything under the sun, recently touted it as a $500 billion industry. So it's a big dollar industry, and back in 2004 about five percent of it was being spent on the on-line channel. That's not a huge portion, but it's enough to sustain a large set of companies and practitioners in that space.
Since 2004, the on-line channel has changed dramatically, with Google, Search Engine Marketing, and Search Engine Optimization. As these and other factors came into play and gained critical mass, it was speculated that spending on the on-line channel would grow to about ten percent. As it turned out, the shift has happened much quicker than anyone anticipated, and now the average is projected to move to about fifteen to twenty percent, with some specific industries shifting to as much as thirty to forty percent.
If you look at the money that's being spent by a company like General Motors, a thirty to forty percent shift is just huge. It's creating an amazing opportunity, not just in terms of dollars, but also in the opportunity to radically redefine what this market is all about.
I think technology-enabled marketing is ravaging the advertising industry. This focus on alternative channels is totally turning the industry upside down. It will change many of the rules of what we think advertising is, what marketing is, and what design is.
In the last ten years, we've recognized that the market would be fragmented and that the channels would be fragmented. We'd all talk about it, and we conceptually understood it, but it wasn't yet real. Now we've arrived at the point where it's here and now - it's the Net, the mobile phone, viral marketing, podcasting, broadband, and it's all coming 24/7.
We talked about broadband back when it wasn't real yet. Now it's going to become pretty real. I spoke to the head of Comcast subscriptions about six months ago, who talked about Comcast's one hundred million download sessions last year. So we're adopting broadband and on-demand interaction with media, we're adoption TiVo, and we're seeing these indications that consumer behavior is shifting.
I think there's a lot at play. And because of all of these dynamics, there's an opportunity to radically design new services and a new way of looking at the whole equation. So yeah, I'm a change junky in this regard.
BS: Before we talk more about the opportunity, can you provide some context? What's driving these changes? Is it consumers, technology, or other drivers?
CM: The technologies I talked about have been around for the last ten years. What's driving this change is the fact that these technologies are now mainstream. People as well as companies now realize they can do more with the technologies they have.
Ten years ago these technologies were viewed as a novelty, and they were matched up with the business models du jour, and everybody was trying them out. Take WebVan for example. The WebVan service is back, it's just being provided by the corner grocer. Safeway is providing it.
Many of the first commercializations of these technologies were thought of as being kind of crazy; but right now, they're pretty mainstream. So what's driving this opportunity is that people have finally understood the potential of the technology and they're saying, "alright, let's get on with it."
BS: Are you speaking about people as consumers or people as providers?
CM: The consumers are definitely driving it. They are switching usage behavior. For the first time, I think it was a year and a half ago, the most desired demographic segments of customers started spending less time on television than on the Internet. It's really a behavioral change happening alongside the mainstreaming of all the different technologies. Consumers are recognizing it and calling attention to it, and we can't ignore this any more. We aren't getting the yield and return that we're used to from traditional marketing channels.
With the addition of blogs, self-help reviews, and peer rankings, customers are now more in control, telling the world what they think of a particular product or brand. Marketers no longer have full control of messaging their brands. Principles of Web 2.0 are now gaining ground, offering more control and power to users. Ad agencies are ill prepared to adapt to these technological changes, let alone harness the use of these new technologies.
BS: Besides the mainstreaming of these emerging technologies, why aren't the old methods of reaching consumers working?
CM: There are many more ways to market. Even though budgets are increasing, there's only so much a company can spend towards any one of these things. So, the question now is, "How can I spend more effectively?" The budget is finite, and the channels are nearly infinite.
We're not only talking about market-channel segmentation, but the consumers themselves are fragmented. Consumers are living in multiple modes, and they have many different personas. In the course of the day one consumer could be in four or five different market segments. This just builds complexity into the whole notion of what it means to market and to engage the consumer with a meaningful experience.
BS: As you're approaching this changing industry, how do you see the design practice playing a role in these changes?
CM: If you get at the heart of the matter, design is really about believing that there must be a better solution. Designers are the eternal optimists. If something is not working - whether it's not efficient, it doesn't communicate well, or it doesn't connect with people - designers always find some way to finesse and improve it. Designers take the mindset that there's always a better solution.
This modus operandi of designers makes them the best equipped to look at alternatives. If you look at typical business thinking and business problem solving, it's really about this notion that the solution is already out there. It's really about deciding which solution is the best one. In comparison, the designer's predisposition is that the solution doesn't exist, so, "let's go invent it."
If you look at marketing, it's about being in the right place and right time. This idea works its way into channel strategy and is especially true with Search Engine Optimization. But with design, and with the act of giving form, the focus in terms of multi-channel experience is making all those points of interaction consistent. When the form comes together, whether it's perceived as individual parts or as a whole, it will consistently resonate with the brand, the promise, and the voice to convey what the product or service is all about. Design a powerful tool for creating consistent form across these fragmented markets and channels.
This powerful use of design holds true provided that the design practitioner understands how to translate the experience into all these different channels and adapt them appropriately. Designers will have to be cognizant of their biases as they dabble into the different formats and different channels. We as designers will bring along with us all of our biases from prior experiences.
BS: For example?
CM: By training, many designers are taught to give structure to form and systems, and create order out of chaos. That's one kind of design; but then you have the medium of interactive games. I think from an engineering perspective, you would tend to structure and systematize the game's play. However, when designing interactive games, you actually want the user interface to support wandering and exploration, as opposed to a structured and readily apparent system. It might not be a good idea to impose structure, rules, and order if you want to encourage play.
Other experiences like chat rooms, MySpace, and Instant Messaging facilitate a non-linear structure of play. Randomness, and the ability to find a unique experience, are part of the strengths and charm of these services. Having too many rules and structures might actually hinder a user experience. I think design should enable these experiences to happen. Design should provide the platform or system that will enable discovery and understanding.
BS: Earlier you said that the rules are changing. What are the new rules, and which rules have been broken?
CM: An advertising account executive once told me that creative, media, and financials drive the world of advertising. If one fails, it affects the other. In my humble opinion, I think all three drivers are at various stage of failure.
I think the financial model of advertising and design is the most broken. The incentives and focus are in the wrong place. Agencies are spending too much time focusing on the size of their client's marketing budget, when they should be focusing on how much value an agency creates for their client's BUSINESS. In a world of fragmented markets, with more choices of media outlets and delivery platforms, not knowing how effectively one spends on media can bury you.
In the advertising world, one makes money by discounting creative, and charging for media purchases and placement. This used to be lucrative, because the channels were limited and because one can leverage a single creative for multiple media execution options. The industry evolved to a point where they can decouple the message from the media placement - they actually have agencies doing media independent of content. Now the clients have gotten smarter, and they're doing the media buying themselves. As a result, the advertising agencies are hard pressed to recoup their creative cost without the media purchase component. Clients are now outsourcing their SEO/SEM work to firms that have little or nothing to do with the agencies.
The agencies are succeeding right now in spite of themselves because their clients don't have anywhere else to turn. Look at what's been happening the last three years in the relationship between clients and agencies. Clients and agencies used to have five- or ten-year relationships. When they talked about a long-term relationships five years ago, they started talking a three-year relationship. Over the last two to three years, the relationship tenure has just gotten shorter and shorter. The clients can't afford to build those relationships now unless the agency can to demonstrate that they can bring the value they want.
The model of the big idea and the big content campaign is still relevant for certain industries, like fashion or maybe the movie business. They have not been able to translate those campaigns into other logical secondary platforms. They don't have the capabilities to do it, and if they decide to do this, they don't have the technical core competencies to do it well. If anything, the execution of those campaigns tends to be dumb and dumber, and the result is a very frustrating experience: long downloads, multiple instances of entering data, clumsy execution, and a lack of connectivity with other systems.
BS: Yet it strikes me that there are some rules of marketing that might be becoming more true than ever. For example, the SMART acronym for establishing marketing initiatives - Specific, Measurable, Achievable, Realistic, and Time-based objectives. With technology and new media, these objectives may be more achievable than ever before.
CM: The very fact that we can measure everything doesn't mean we should. It's about understanding what you should measure. Don't let the customers' behavior always drive what you do in business. It's deadly if you just follow what the customers do, instead of being inspired by what your customers do and then building a great product or service from that inspirational source. You can gather as much data about the customer as you want, but it's understanding what people look for and the things you should be watching, as opposed to collecting and measuring everything.
The companies with web analytic tools can generate a terabyte of information every day, but no one's bothering to look at a terabyte. In response, some of the smart Search Engine Optimization and Search Engine Marketing companies are starting look at the metrics that matter to a business, what related consumer behaviors they want to monitor, and as a result create a better model for analytics. It takes a lot of work and a lot of investment, so by-in-large no one's doing that. No one wants to do that because it's actually not all that sexy for the designers and engineers. The analytic data providers can crank out yet another set of attributes to look at, but the question is, will anyone act on those numbers, and how?
I see the opportunity to marry Experience Modeling with the smarts of the Information Architect to structure a powerful model in the user's world, whether that be through cell phones or tagging systems. The opportunity is to create a model that ties together the deep ethnographic understanding of the user, the system engineering understanding, and the brand/marketing understanding. Tying these three things together is quite powerful.
BS: What kinds of new services do you think design firms need to provide that the agencies aren't?
CM: Creative still has to be the core, but rigor, discipline, and technical competencies have to augment that creative core, to stretch the capabilities of the medium while acknowledging the limitations. That's something that I think the creative agencies aren't capable of dealing with today. They outsource it, and they don't know how to integrate it.
There should be connectivity between the business systems of the client and the systems of different media platforms. You should be able to look at what you've done with direct marketing and advertising and roll that right into CRM. At the end of the day you should be able to poke that data into a sales system and understand, "This particular campaign, this particular podcast, resulted in this number or this spike, with this particular customer base."
You can't let this connectivity drive the design, but it will certainly inform you as a business on how to manage the dial and how to design more effectively. If a certain type of design resulted in a mad rush to a particular product, you'd certainly like to pick out what you did right and wrong. But right now, it's just a pure guessing game. If you ask an agency, "Was the campaign very effective?" they'll respond by saying, "We had lots of traffic to the web site!" But was that traffic effective? Did it lead to sales? No one knows.
So what we'd like to do is to increase qualified leads to the web site, which in turn are converted to sales at a quantifiably higher rate than before. Now, is that good news for designers? That really depends. A designer could take this scenario as, "Okay, that's really helpful. Now I can figure out how to design something even better and more effective." Or the designer might take this scenario as a total turnoff and say, "Oh shit, numbers can't drive creative! Those bean counters are ruining the business." Viewing this as a positive is going to be the biggest challenge for design.
There's an opportunity for designers is to see this as a vehicle to drive a positive change in consumer behavior; meaning less brochures, less burning of forests to produce paper goods, and less wasteful consumption. Consumers will still spend money, but consume in a different way. A big emerging trend that designers need to wrap their head around is sustainable, clean lifestyles. There will be less waste if designers can use data mining capabilities and the fragmentation of media to design more effectively.
BS: Can you provide some examples?
CM: My first example comes from Planning Group International, a Miami-based firm that Sapient recently acquired. PGI has a mix of ad agency guys, production people, and printers. As much as we like to think of them as marketers, they also have a shop that prints out all of the place cards for Citicorp. Whenever Citicorp launches a new program, PGI does the banners, the micro-sites, the direct mail, as well as placing the merchandising cards at all the Citicorp branches.
Because Citicorp needs to measure all of these executions on these different platforms, PGI has created proprietary software to measure the effectiveness of what they've done for the client. In doing so, the clients are seeing them as providing a dashboard for how to allocate their spending across various media.
Another example comes from when Sapient was the agency of record for Nissan, Sapient was doing a pre-launch site for a car. Part of the site was a configurator, where consumers could play with and configure the set of finishes, accessories, and styles they liked. Chiat\Day saw the reports on how people were configuring the car on the pre-launch site and chose to alter the entire print campaign to reflect this insight. That's pretty powerful.
A third example comes from Sony. Sony was using QuickTime VR to show these 360-degree views of their products online. Each one was costing Sony about $1,000 a pop. If you looked at the sheer number of SKUs that Sony was implementing, they were doing close to $200,000 - $300,000 worth of these little demos each year. However, Sony had no idea if these interactive views of their products improved the user conversion rate. After quickly implementing and analyzing some measures of drop-offs, conversion, and cross-references, it was determined that the QuickTime VR demo didn't positively impact the business. The measurements show that there were in fact downloads of these whirly-twirlies, but users never went from these novelty downloads to purchasing. Instead, the users going to product details and specification pages ended up purchasing either on-line or in a retail store. As a result, Sony realized that QuickTime VR wasn't necessary for every product. The measurement provided insight into how they could get more bang for the buck.
BS: You've written about design being in a stasis for many years. Is this different role for the designer a move out of stasis?
CM: What I'm talking about is a hybrid practice. The old way of design will still exist, and people will still make a living the old way. However, it will increasingly become a commodity.
So far we haven't talked about the impact of outsourcing. Increasingly, if we as designers don't change what we do, the rest of the world will copy what we do. They'll get better at it, doing it in a more cost effective way, and there just won't be jobs for us. Therefore, we need to find new problems that need to be solved; and that's what makes design really interesting.
Clement Mok is a designer, digital pioneer, software publisher/developer, author, design patent holder and serial entrepreneur. A former creative director at Apple, he founded multiple successful design-related businesses--studio Archetype, CMCD and NetObjects. Most recently he was the Chief Creative Officer of Sapient, and the president of AIGA. Currently, he is Global Director of Design Planning at Sapient, CEO of CMCD Visual Symbols Library, and an independent consultant on a variety of product development projects.
Brandon Schauer is a senior practitioner for Adaptive Path, a leading user experience company. He has nearly a decade of experience developing new products, services, and user experiences for the Web, handhelds, and more. Brandon received a Master of Design from the IIT Institute of Design in Chicago, where he studied the planning, development, and management of innovation. Concurrently, he graduated with an MBA from the IIT Stuart School of Business.
