DIGITAL

MARKETING

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Bias/effects & paradox in Marketing
• The more exposure effect
• Loss aversion
• Compromise effect
• Choice supportive bias
• Framing effect
• Anchoring
• Confirmation
• Bandwagon effect
• Salience
• In-group favouritism
• Zero risk bias
Bias/effect & paradox in Marketing-application in a Digital
World

• The More exposure effect

1968 study”Charles Goetzinger”-student in a black bag!
Hostility-acceptance-being friendly!

Application:“Familiarity breeds content”

-Retargetting
-Redistribute same content in diff forms-Blog-Video-PPT….
-Reshare in diff social mediums
Bias/effect & paradox in Marketing-application in a
Digital World
• Loss aversion
1979-Daniel Kahneman & Amos Tversky
-more painful to lose than gain!

Application:
-Free trials
-Freemium
-Limited time offer
-Countdown timer
Bias/effect & paradox in Marketing-application in a
Digital World
• Compromise effect
1992 experiment-Itamor Simonson & Amos Tversky

Application:
-Price lining

-Focus on the middle price point

Bias/effect & paradox in Marketing-application in a
Digital World
• IKEA effect
2011 study-Michael I Norton/Daniel Mochan & Dan Ariely

Application:
Involve customers in creation-possible paint application!
We have gone through…
The Product
Era

The Positioning
Era

The Place Era –

geography
expansion
The Globalisation
Era

The Promotion
Era

THE PLATFORM
And now we have…
ERA
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 Product Era Positioning Era Place Era

Globalisation Era Promotion Era Platform Era

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What do you understand by Digital in an organizational
context?

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 Digital Digital Digital Digital
products commerce marketing operations

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 4 Levels of Digital Mastery

Digital
Fashionistas
Masters

Digital Capability

Beginners Conservatives

Leadership Capability

Source: Leading Digital (Book )-Gearge Westerman,Didier Bonnet & Andrew McAfee

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 Where is an Orgn in this journey?
Fashionistas
• Many advanced digital
features (e.g., social, mobile)
in silos
• No overarching vision
• Underdeveloped
coordination
Digital Capability
• Digital culture may exist in
silos
Beginners
• Management sceptical of the
business value of advanced
digital technologies
• May be carrying our some
experiments
• Immature digital culture
Leadership Capability
Source:Leading Digital (Book )-Gearge Westerman,Didier Bonnet & Andrew McAfee
Digital
Masters
• Strong overarching digital vision
• Excellent governance across
silos
• Many digital initiative generating
business value in measurable
ways
• Strong digital culture
Conservatives
• Overarching digital vision, but may
be underdeveloped
• Few advanced digital features,
though traditional digital
capabilities may be mature
• Strong digital governance across
silos
• Active steps to build digital skills
and culture
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 The New Elements of Digital Capability
BUSINESS MODEL
Digital enhancements
Information-based service extensions
Multisided platform business
CUSTOMER EMPLOYEE
OPERATIONS
EXPERIENCE EXPERIENCE
Experience design Core process automation Augmentation
Connected & dynamic
Customer intelligence Future-readying
operations
Data-driven decision-
Emotional engagement Flexforcing
making
DIGITAL PLATFORM
Core
Externally facing
Data
Source: The new elements of Digital Transformation: Didier Bonnet and George Westerman: MIT Sloan Management Review: Winter 2021 issue

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 Lets look at…
BUSINESS MODEL
Digital enhancements
Information-based service extensions
Multisided platform business
CUSTOMER EMPLOYEE
OPERATIONS
EXPERIENCE EXPERIENCE
Experience design Core process automation Augmentation
Connected & dynamic
Customer intelligence Future-readying
operations
Data-driven decision-
Emotional engagement Flexforcing
making
DIGITAL PLATFORM
Core
Externally facing
Data
Source: The new elements of Digital Transformation: Didier Bonnet and George Westerman: MIT Sloan Management Review: Winter 2021 issue

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 Business Models scale differently
Network Low scaling cost
orchestrator Many make, many
sell
s
Technology Make one, sell many
creators

Service
providers Hire one, sell one

Asset
Make one, sell one
builders
High scaling cost

Source: The Network Imperative: Barry Libert/Megan Beck/Jerry Wind

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 Lets look at…
BUSINESS MODEL
Digital enhancements
Information-based service extensions
Multisided platform business
CUSTOMER EMPLOYEE
OPERATIONS
EXPERIENCE EXPERIENCE
Experience design Core process automation Augmentation
Connected & dynamic
Customer intelligence Future-readying
operations
Data-driven decision-
Emotional engagement Flexforcing
making
DIGITAL PLATFORM
Core
Externally facing
Data
Source: The new elements of Digital Transformation: Didier Bonnet and George Westerman: MIT Sloan Management Review: Winter 2021 issue

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 Creating a Compelling Customer Experience
Digital masters do 4 things

Designing Customer Customer data Seamlessly

customer reach and at heart of mesh physical
experience engagement customer and digital
from outside in experience experience

Source: The new elements of Digital Transformation: Didier Bonnet and George Westerman: MIT Sloan Management Review: Winter 2021 issue

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 : A Case Study
Different competitors at different stages

1995 2000 2006 2007 2011 2012 2014 2020

Launched Opened Launched Launched Released Launched Launched Launched Launched

as an website to Amazon Web Amazon Kindle Amazon Amazon Echo; sold Amazon
online book third party Services Unbox, ebook Studio (in Marketing 11Mn units Food
seller sellers in (cloud before readers partnership Services in 2 years delivery
multiple computing Netflix (ahead of with Warner (now service
Offline book categories services) started iPad) Bros.) Amazon
stores streaming Advertising) Swiggy,
Walmart, IBM Razor-blade Other Google Ads Zomato
Best Buy, Apple, strategy Hollywood
Toys R Us Netflix studios

Amazon’s meaning for us:

“Define Your Business Around Your Customers, Not Your Products or Competitors”

Adapted from “Driving Digital Strategy” by Sunil Gupta, HBR Press Aug 12 2020

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The Transformation
of • Weather maps
Weather • Weather forecasts
Data • Rain, humidity,
temperature sensors
• Tractors
• Tillers
• Planters

Farm Farm Seed

Equipment Management optimisation

• Seed database
• Farm-performance
databases
• Speed-optimization
• Field sensors applications
• Irrigation nodes Irrigation
• Irrigation
application

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New Ways To Build Value For Customers And
Create Competitive Advantage
MULTIPLE CUSTOMERS

Network effects: Creative Network effects and

virtuous circle compliments
1. WhatsApp 1. Amazon
2. Facebook 2. Paytm
3. Amazon Marketplace 3. Dunzo
SINGLE 4. Uber 4. Swiggy MULTIPLE
PRODUCT PRODUCTS
Traditional strategy: Make Compliments: Razor-Blade
it cheaper or better Strategy

1. Automobiles 1. Echo and e-commerce

2. Consumer Products 2. Kindle and ebooks
3. Financial Services 3. iPod and iTunes
4. Peloton Bikes
5. Nike Shoes

SINGLE CUSTOMER
Adapted from “Driving Digital Strategy” by Sunil Gupta, HBR Press Aug 12 2020
 Lets look at…
BUSINESS MODEL
Digital enhancements
Information-based service extensions
Multisided platform business
CUSTOMER EMPLOYEE
OPERATIONS
EXPERIENCE EXPERIENCE
Experience design Core process automation Augmentation
Connected & dynamic
Customer intelligence Future-readying
operations
Data-driven decision-
Emotional engagement Flexforcing
making
DIGITAL PLATFORM
Core
Externally facing
Data
Source: The new elements of Digital Transformation: Didier Bonnet and George Westerman: MIT Sloan Management Review: Winter 2021 issue

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 Operations

Core Process Connected and Dynamic Data-driven Decision

Automation Operations Making
• Amazon DC’s Inventory • Schindler – integrated • Moving away from backward
delivery business rather than by looking reports to real time
• Rio Tinto – autonomous product category data through:
trucks, trains and drilling • Once integrated, helped • Connected devices
machinery optimise transportation • ML algorithms
needs, proactively respond to • Large amount of data
mechanical issues • Smarter experimentation

Source: The new elements of Digital Transformation: Didier Bonnet and George Westerman: MIT Sloan Management Review: Winter 2021 issue

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 Employee Experience

Augmentation Future Readying Flexiforcing

• Fear of Robots replacing • L&D to use digital methods to • Multi-skill, to be more agile
labour may not always be the digital-ready employees of • Gig workers – reference to ex-
case the future; also, digital employees
• Huntington Ingalls Industries learning democratises • Smart contracts – Theory of
– Ship building – uses AR to learning delivery incomplete contracts (Oliver
improve safety and Hart)
streamline processes; • Vancouver’s Island Health
integrates a worker into the Authority & South Island
entire project management Hospitalists
process

Source: The new elements of Digital Transformation: Didier Bonnet and George Westerman: MIT Sloan Management Review: Winter 2021 issue

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 To Summarise…
BUSINESS MODEL
Digital enhancements
Information-based service extensions
Multisided platform business
CUSTOMER EMPLOYEE
OPERATIONS
EXPERIENCE EXPERIENCE
Experience design Core process automation Augmentation
Connected & dynamic
Customer intelligence Future-readying
operations
Data-driven decision-
Emotional engagement Flexforcing
making
DIGITAL PLATFORM
Core
Externally facing
Data
Source: The new elements of Digital Transformation: Didier Bonnet and George Westerman: MIT Sloan Management Review: Winter 2021 issue

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