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Ron Jacobs on the State of Marketing, Storytelling and AI

Posted by Emily Hegland on May 23, 2019

 

Everyone is a marketer in some way. It can be as small as what you choose to post on your social media channels or as large as a company’s multi-channel acquisition campaign. Regardless of how obvious it is, marketing infiltrates every part of our lives. J&See: Views on Marketing, an original podcast from J&C, explores how marketing influences the world around us.

In the first episode, Meg Goodman talks to Ron Jacobs. He is the CEO and founder of J&C as well as co-author of the best-selling book, Successful Direct Marketing Methods. Together, Meg and Ron explore how marketing has changed over the years — and where it’s headed in the future. Read on for a few excerpts from his insightful interview. And of course, make sure to subscribe to J&See: Views on Marketing to hear a compelling interview like this once a month. 

Q. It’s been 37 years now [since you started J&C]. What have you seen change over that time … as a marketer?

A. I think the biggest change I’ve seen is that all the things that direct marketers did — we used data, we used calls-to-action, we targeted deeply on demographics and on psychographics and on behaviors — those things have actually become marketing today. And when you look at what digital marketers do and what direct marketers do, there are an awful lot of similarities.

Q. Where do you see the state of marketing today?

A. Marketing has become very complex. And as a result, it’s never been harder for marketers to make good marketing decisions. This complexity is based on the wealth of data that we have, the wealth of channels that we have, the number of ways we have for consumers to respond ... Now, the good news is that today, almost every form of marketing is measurable. The bad news is that too many of those measurements tend to be what I call “vanity metrics.” As a marketer, I find that to be a bad use of marketing or a bad way of saying something works.

Q. Can you explain “vanity metrics”?

A. Vanity metrics are things like “likes” … things where people aren’t really buying something. There’s no conversion. There’s no extra effort. They actually haven’t closed a sale.

Q. Now we’re seeing the word “storytelling” really become important again. Would you talk about that?

A. Well, direct marketers have always had the advantage of being able to measure communications. So, because we could measure it, we would find ways to get people to respond and a lot of effort was put into the response side of the equation. It often made direct mail what I call a “yard sale.” It made it look like it was people waving banners, putting signs up — “Call now,” “Respond now,” “Do this now” — and as a result, direct marketers kind of got away from telling the story. 

The study of behavioral economics has provided a real good insight into how marketers should be thinking about the way consumers respond. Most consumers make decisions not logically — they make them emotionally ... There’s a part of the mind that goes for the emotion and that’s the side where we actually make decisions. We then rationalize those decisions using the logic side of our brains. So, the emotional side hooks us into making the decision. The logic side then says, “Here’s how we rationalize it.”

A story usually has a hero and that hero has to have a plan — and that plan is something that they try to execute. And the end result is something very positive for the reader. And if you think about anything from Indiana Jones, even the Star Wars stories, they kind of follow a plot that’s very much like this. Well, we’re starting to see that communications can do the same thing — with a couple of subtle differences.

First of all, it’s not really the brand in a communication that should be the hero. It’s really the customer in the communication that should be the hero. The company or brand needs to help guide that consumer into understanding what it is a product or service can do. But they have to show that it will really work … and then when they show that it really works, that’s really at the end of the day, the part where everyone lives happily ever after. So, we see this storytelling model applies to all communications … The results are significantly better when you balance logic and emotion.

Q. Would you talk a little bit about AI? What is it and how is it being used today?

Well, AI is based on machine learning … Now, while AI is a new idea, machine learning isn’t. Machine learning has actually been around for a long time. And what sparked machine learning was the amount of data that we have out in the marketplace.

Marketers have what I call “Small Data” and “Big Data.” “Small Data” is the name, address and basic information that we’ve always had. “Big Data” comes from data that doesn’t have that structure. It’s not in rows and columns. It could be reviews, it could be how long they were on a website, what their dwell time was, what products they looked at.

Machine learning works where it has a lot of repetitions. So, the more inputs you can give it, the more data you can feed the machine learning, the better it gets at learning how people will react or how something will react. So, AI uses this tool — machine learning — as it’s underpinning and it starts to predict what people will want, what people will do.

Netflix has really been good at using AI to predict movies that people will watch … For example, if you look at a lot of John Travolta movies, they’ll recommend other John Travolta movies. If you’ve watched a lot of Uma Thurman movies, they’ll give you a lot of Uma Thurman titles. If you’ve watched both of those, they’ll probably recommend a movie like Pulp Fiction. But when you see the ad, if you’ve watched more John Travolta movies, you’ll see the promo … with John Travolta in it. If you’ve watched a lot of Uma Thurman movies, you’ll see the promotion with Uma Thurman in it. That’s how this subtle use of AI is actually becoming very pervasive. 

 

Listen to the whole episode to hear Ron’s thoughts on everything from direct mail deliverability, the rise of smart speakers and the essential skills every marketer should have today. Download J&See: Views on Marketing on Apple Podcasts and Spotify. Or you can listen to the episode on Google Podcasts and Castbox. And make sure you subscribe to get a new episode every month.

Topics: Direct marketing, data marketing, Artificial Intelligence, Podcast, Behavioral Economics, AI

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