Property records: A property passport could be established that lists all safety checks, mortgages attached to the property, equipment installed (and removed), planning permissions and ownership. The current owner has the encrypted digital key that is handed to new owners when needed.
As a company, Blockchain is promoting itself as ‘the world’s leading software platform for digital assets’ and has secured funding from major investors including Google’s Venture Capital company Lakestar and Sir Richard Branson (Blockchain, 2017, p. 1).
There are drawbacks to blockchain technology too: supercomputers use a lot of energy; some say as much as a small country! The database keeps growing and it is getting slower; if you make a mistake, it is there forever and can’t be changed. Once content is added, it can’t be corrected – whilst that has advantages, it is also a disadvantage. It is also complicated and will take time to be used routinely by many major companies.
KEY TERM DISINTERMEDIATION Disintermediation is about removing the middle man or the intermediary. Researchers Manjit Yadav and Paul Pavlou suggested that disintermediation was ‘the elimination or significant curtailment of the role played by intermediaries’ (Yadav and Pavlou, 2014, p. 34).
FURTHER EXERCISES 1. Imagine you are working for an organisation with an older audience, mainly
digital immigrants. Write 500 words explaining the key changes in traditional to digital marketing and what this means to them.
2. Create an outline plan to start a blog as an opinion leader. What tools or skills would be needed? What would be the subject area? What types of content would be included?
THE DIGITAL MARKETING LANDSCAPE 23
3. Analyse the Internet of Things in your environment, whether at home, work or university. How are these items connected or how could they be connected?
SUMMARY This chapter has explored:
• The critical factors in the digital marketing landscape from ubiquitous computing to micro-influencers.
• Why the move from traditional to digital marketing tools has occurred and the difference between digital natives and digital immigrants.
• How digital disruption can change market sectors.
• Ways that the Internet of Things can be applied to consumers.
• How privacy and data need to be carefully managed in a marketing environment.
• The future potential of blockchain within business.
2 THE DIGITAL CONSUMER
LEARNING OUTCOMES When you have read this chapter, you will be able to:
Understand consumerism and hedonic consumption
Apply the Technology Acceptance Model
Analyse the digital customer experience
Evaluate consumer power
Create a customer journey
PROFESSIONAL SKILLS When you have worked through this chapter, you should be able to:
• Construct an online customer journey
• Analyse the digital customer experience
• Create a service blueprint
THE DIGITAL CONSUMER 25
2.1 INTRODUCTION In this chapter we will explore how digital marketing has introduced a whole new era for the consumer. We can browse, compare, share and shop online. From owning to renting, it’s all about delivering a successful customer journey.
We all study consumers – psychologists, sociologists, anthropologists, economists and other experts. People-watching is a key part of consumer research: whether people decide to buy or not to buy, how they choose, use and dispose.
2.2 THE EVOLUTION OF THE DIGITAL CONSUMER We have moved from a time where companies made as many products as they could and sold as many as possible in the mass production era, when there were few options for shopping other than local stores. We are now in an era where we can access any goods from any place at any time and often on any device. There is an emergent culture of sharing what we have; from cars, to parking spaces, from spare rooms to food. Plus we are more accepting of technology and see the usefulness it contributes to our lives. So who or what is the digital consumer?
Let’s start with a definition of consumer from the Oxford English Dictionary (Oxford Dictionary, 2017a):
• ‘A person who purchases goods and services for personal use.’
• ‘A person or thing that eats or uses something.’
That’s fairly straightforward. We all buy things and use them. At one level I’m a consumer of salads and cappuccinos, at another I’m a keen consumer of handbags. The salads and coffee are essential purchases to fulfil a need of not being hungry or thirsty or tired. And the handbags. I don’t actually need any more bags. Each year I say I won’t buy any more, but that year hasn’t quite happened. The handbags are fun, make me smile and the whole process of selection and purchase is hedonic. So, I am a hedonic consumer (see Key Term).
DISCOVER MORE ON CONSUMERISM For a full history of consumerism, Steven Miles (1998) has a useful book: Consumerism – As a Way of Life.
In the Journal of Consumer Culture, George Ritzer and Nathan Jurgenson (2010) wrote ‘Production, consumption, prosumption’, which also described the evolution of these phenomena.
There are many excellent journals relating to consumers which you can explore online via your university library system, including: Journal of Consumer Behaviour, Journal of Consumer Culture, Journal of Consumer Marketing, Journal of Consumer Psychology, and Journal of Consumer Research.
DIGITAL MARKETING26
But the handbags offer a utilitarian benefit too (see Key Term). They store stuff. I have different bags for different events with specific utilitarian benefits. If it’s a train journey, I take a bag with a cross-body strap as it’s less hassle getting on and off trains. If it’s a plane journey, I take a bag with a strong zip so everything doesn’t fall out at the security checks. If it’s a day at the university, I take a big open bag to hold the water bottle, books and other student paraphernalia. These functional attributes are utilitarian benefits whereas the amazing handbag shape, the designer, the colour and the materials are all hedonic benefits.
KEY TERMS HEDONIC AND UTILITARIAN
CONSUMPTION The Greek goddess Hedone represented pleasure and enjoyment and is the origin of the word hedonism. Describing consumption as hedonic indicates that it provides delight. Hedonic consumption is largely credited with having been placed on the marketing research agenda by Elizabeth Hirschman and Morris Holbrook:
Hedonic consumption designates those facets of consumer behavior that relate to the multi- sensory, fantasy, and emotive aspects of one’s experience with products. (Hirschman and Holbrook, 1982, p. 92)
A hedonic consumer is thus a consumer who gains happiness from acquisition! Utilitarian benefits have been described as the functional, instrumental and practical
attributes of the item (Chitturi et al., 2008). For more on hedonic and utilitarian consumption see: ‘Pleasure principles: A review of
research on hedonic consumption’ by Joseph Alba and Elanor Williams in the Journal of Consumer Psychology (Alba and Williams, 2013).
Michel Pham discussed consumer psychology, mainly concerning the way the research has become detached from practice. He illustrated the scope of consumer behaviour as being framed between consumer experience and consumer learning, which is shown in Figure 2.1.
If we apply this in a digital context we might consider an online-only product, such as online storage space. We are in an environment where we write reports, create presentations, store images and collect content. All these online documents require storage. You could store your documents on a PC, but the challenge is that you may use different PCs or laptops – at home, at the university and in libraries. And what happens if your main laptop breaks or gets stolen? That would mean your work was lost too.
Thinking about the potential for things to go wrong, it is easier to rent some space in the cloud.
The concept of ‘the cloud’ means we can access our materials at any time from a remote or virtual computer, which enables ubiquitous computing (see Key Term, p. 4).
THE DIGITAL CONSUMER 27
Consumer Experience
Desire Acquisition Use/ Consumption
Disposal/ Divestment
Consumer Learning
• Problem recognition • Need arousal • Deprivation • Wants • Wishes & aspirations • Interests • Tastes
• Search • Shopping • Selection • Decision making & choice • Purchase • Shipment/ transportation • Gift • Rental/leasing • Borrowing • Stealing
• Set-up • Preparation • Customisation • Consumption • Enjoyment • Sharing • Storage • Maintenance • Satisfaction • Possession • Collection • Mental consumption
• Discarding • Re-using • Recycling • Reselling • Donating • Storing away • Replacement • Hoarding • Consumption withdrawal
Figure 2.1 The scope of consumer behaviour
Source: Pham, 2013, p. 414
Cloud storage options have expanded in recent years. Many people started with a small amount of space in Dropbox that they rent with a free account. This is free-renting.
Dropbox’s aim was that as your storage needs increase, because you might hoard docu- ments, rather than sorting out and deleting older copies, you will need to upgrade to a paid-for plan. In this example, you never own the product, you simply rent, paying either a monthly or annual rental charge.
This is an example of utilitarian consumption. You may not feel delighted subscribing to Dropbox, but it is useful for online storage. Dropbox is trying to transform this into a hedonic purchase with the idea of ‘gifting’ storage to a friend. I don’t know about your friends, but mine would consider it odd if I gifted them online storage space!
There are alternatives to cloud storage. You could use external hard drives or USB sticks. These could present the same issues as a hard drive. The Macbook or laptop could freeze, may need to be completely re-set (return to factory settings) and I could still lose the data.
KEY TERM DEMATERIALISATION The one area of material consumption that has completely transformed, from a traditional acquisition of artefacts to digital consumption, is music. There was a time when people owned vinyl records, then cassette tapes or CDs, whereas today very many of us don’t physically own any music; we rent all the playlists we want via a monthly Spotify, Amazon or iTunes music account.
This can be described as ‘dematerialisation’, where we stop purchasing and owning material items and instead rent or share (for more on digital music consumption, see Magaudda, 2016).
DIGITAL MARKETING28
Imagine if that was a whole semester’s worth of work …
Other competitors to Dropbox are likely to be available to you right now. Your uni- versity might offer OneDrive storage, Google offers Drive and Apple offers iCloud. It’s all free storage space until you need more and it’s all online and accessible any- where at any time.
The digital environment has provided consumers with access to more choice and customer acquisition has changed, as shown in Table 2.1.
Table 2.1 Differences in customer acquisition for traditional and digital consumers
Acquisition steps Traditional consumer Digital consumer
Search High street or shopping mall, items in magazines
We search online for products
We explore products our friends recommend on social media
Shopping Physical visits to stores We use branded websites and comparison websites to shop online
We use store apps for instant shopping
Selection See products closely and decide whether to buy
We compare delivery times, costs, overall costs
We check reviews and ratings
Decision making and choice
Decision making with fixed store times
Based on ratings and ease of purchase we decide and choose
We save items for later with ‘wish lists’
Purchase Involves queuing to pay One-click delivery systems, next day delivery, delivery to lockers
Gift Requires additional effort to take away, wrap, pack and post
Automatic gift options and reminders, purchase from one address and delivery to another address
Rental Physically visit a store to organise a rental agreement
We rent music, properties, cars and more, at the click of a mouse
2.2.1 ACCEPTING NEW TECHNOLOGY These changes in behaviour show our acceptance of technology, and back in 1989 this was a major challenge. This was at a time when computers were being introduced into the workplace, where there were difficulties in comprehending the benefit of these devices. Your grandmother might have used a typewriter or even a telex machine. Suddenly computers started to be introduced.
Businesses were having difficulty persuading companies to adopt this new technology and Fred Davis, a researcher at the University of Michigan in the United States, was exploring ways to predict system usage by testing the adoption of new technology based on positive attitudes towards the perceived client benefit and the user experi- ence. His measurement framework is called the Technology Acceptance Model (TAM) (Davis, 1989) and it is shown in Figure 2.2.
TAM was originally designed to ‘explain computer usage behaviour’ (Davis et al., 1989, p. 987), although more recently it has been adapted to measure the adoption of new
THE DIGITAL CONSUMER 29
