Consumer education today is about the introduction of the television and youtube:Ramonet calculated that we see around 500,000 advertisements between the ages of 3 and 18;enough for any social conditioning.
A man by the name Edward Bernays, popularly known as the“father of public relations”(PR), rose to fame because he was good at propaganda and positive publicity. He took advantage of people because he believed that many of them were controlled by their illogical desires. He also knew that if he manipulated them well, people would give him large profits. He understood that the mind could be tempted and lured into buying ideas and products if only one used persuasive methods.
The best-known campaign carried out by Bernays was to recruit women smokers of cigarettes, which he termed“torches of freedom.”Women were not allowed to smoke publicly at the beginning of 20 th century, a norm that was enforced by law in many states and leading to many prosecutions. Bernays recruited women who could march in his campaign to show that they were fighting for the rights of women to smoke. The pseudo-event was a great public relations success and received wide media coverage, helping to increase sales of cigarettes to women. Seeking to bring equality between women and men led cigarette manufacturers to begin advertising to women not only to smoke but also to protect their reputations. This move went so far that many cigarette brands were specifically designed for and marketed to women.
George Washington Hill, who was the chair of the American Tobacco Company at the time, saw this as an opportunity to market his products and thus increase his production and profits. Hill hired Bernays, and explored the market interest as if it were a gold mine. This led many cigarette companies to start campaigns and lecture series with the aim of teaching women how to smoke. This was a tricky move legally because, after being employed by ATC, Bernays went on to manipulate women into smoking by using health advertisements to show that cigarettes were associated with an oral fixation among women, and therefore naturally desirable. Bernays hired women to march while smoking and a photographer was hired to take nice pictures that would later be published in magazines. Bernays used his ideas of good PR and propaganda to turn many women into smokers.
Serge Tchakhotine, Russia's communications opponent to Hitler, showed that advertising plays on people's obsessions by drawing out their deepest impulses. He used Pavlov's theory of the conditioned reflex alongside a ranking of human impulses:aggressiveness, material satisfaction, sexuality, and love. Just as there are rules for feeding and training an animal, so it is with communication and advertising. I sold cosmetics for many years, and used the third pulsion(the sexual one)by way of a beautiful lady on a poster to sell cosmetic products targeting women. A woman unconsciously wants to look like the person on the poster. In similar fashion, a hospital in 2020 can automate its health data collection, and from a single set of symptoms, an AI can easily discover more than one health problem. A brand can then use the second pulsion(material satisfaction)to tell the patient which drugs to buy.
It is incredibly easy to create needs for products that you do not truly need on a large scale. A strategy to communicate need and fulfillment was conceptualized with this in mind during the 1960s by Procter&Gamble:the“copy strategy.”
By the 1950s, overproduction was problematic in America. This problem changed not only marketing strategies but the notion of social class. Marketing was the first to change;it was no longer only about making a pitch(i. e. , “my product is the best product out of a sea of similar products”), it was about Jerry McCarthy's famous “four Ps”:product, price, place, and promotion. The four Ps got marketing out of being strictly about promotion and later extended it to other domains(e. g. , partnership, sensorial identity of the product). The second change was increasing the production of goods that drive up effective demand rather than creating additional supply on the market. Marketing history is full of overproduced and undesirable products, such as “baby food for adults, ”innovations in the armaments industry(a reliable sector for creating new needs and products to satisfy them), Toca Cola, King Cola, Mecca Cola(a cola whose profits are given to the Palestinian cause)or Breizh Cola(a Brittany-branded cola), cucumber deodorant, and colorless beer. As a result of the Vietnam War, there were limited armaments, but this turned out to benefit the American economy as production ramped up. When the war ended in 1975, this solution temporarily disappeared. For various reasons, overproduction became a problem again. In the 1970s, workers'wages were not in line with the pace of productivity, meaning productivity rose while wages were stagnant. Mass production was problematic, however;out of economic turbulence emerged innovations that would impact the US and the rest of the world through the 1970s and beyond. By the 1980s, market segmentation gained traction.
Through the use of market segmentation, companies could overcome the difficulties of pitching a product amid a sea of similar products. Segmentation divides the market into groups that are heterogeneous in the sense of the characteristics of the people comprising them(e. g. , women). This allows a marketer to sell more products because a future target becomes easier to reach—it's easier to sell a product if you know the criteria and relevant human behavior.
An example was the Freedom Paradise Resort:“The world's first sizefriendly, all-inclusive beach resort, 112-room Freedom Paradise Resort was located in Tankah, Mexico, on the Yucatan Peninsula 70 miles south of Cancun.” The idea behind it was simple:“Provide a vacation getaway where people of size would feel not only comfortable but welcome.”So, rather than just being another resort, it was a resort for“people of size, ”which is to say people who are not slender. Segments catered to in other contexts might include skaters, surfers, gay people, straight people, minorities, smokers, parents, and kids. All these segments are good for targeting people because you know the demographic criteria through psychographic, behavioral and benefit research. Many studies have been done to show that capitalism created new targets of better consumers:divorced people are better consumers than united families, metrosexuals and gays are bigger buyers than more conservative men, etc.
Segmented sales tactics to convince prospective buyers, welcoming campaigns by text, reanimating inactive customers(or“basket abandoners”)—companies can now automate up to 66% of their campaigns, which generate 75% of revenues. Every morning, a brand like Bricoprive sends 4.5 million emails to its customers and prospects. Emarsys, an Austrian-based publisher that aggregates data from 2.9 billion customer profiles, relieves marketers of cleaning their data and such analyses as segmentation, calculations by age group, recurrence of purchase, average basket, sales channels, or abandonment of sale. Based on a sales history(from one to ten years), their AI engine calculates all aggregates to say that, this morning, thus-and-such number of prospects are ready to be converted to customers with whichever product and what will be the formulas for accomplishing this. Emails are dispatched when they are most likely to be read, for example 9:30 for Sarah and 10:15 for Paul. Once opened, the AI customizes the content of the welcome-back message by focusing on the product that is most likely to be purchased.
The companies'AI marketing consists of dividing up the needs of consumers just like you on Cdiscount, Sephora. fr, or Amazon. After a strict demarcation, the companies conjure the needs of the consumers in homogenous, calculated sub-groups of products.
There are two ways to examine marketing:supply and demand. Each point of view is different. The first one is demand;it comes from market studies and trying to understand consumers'needs. The other is:“as a company, I will push new products out and they will buy it, even if they do not need it”.
When companies launch a product, they have four big steps to run through:create a product, do market studies, create a strategy, and then implement the strategy at the right time. Market studies are used to determine consumers'needs. Such studies have always existed and are the core of modern marketing using data and info about consumers. Companies like Procter&Gamble or L'Oréal are spending millions of dollars to understand the deep pulsions of people to create the right lines of products. Marketing departments are also recreating fake supermarkets and fake shelf spaces, essentially beta testing the consumer experience of buying their products. In this scenario, they use techniques such as neuromarketing or ethnomarketing to follow the movements of the eyes on the products or of the hands when they set aside one product in favor of another. Marketers want to understand the needs of the people. But marketing studies are not actually as simple as asking people what they do or need. People lie or make mistakes. For instance:“One of the enduring mysteries of alcohol research is that when you tally up all the booze that people report consuming when they are surveyed about their drinking habits, it rarely adds up to even half of the alcohol sold. So either we pour half of the liquor we purchase into the sea or we tend to forget—or intentionally lie about—how much sauce we imbibe.”Likewise:“27% of adults lie to their dentists about how often they floss their teeth, a survey found.”
Another example can be found in politics:In 1982, African-American Mayor Tom Bradley took a decision to contest for the position of Governor of California. His opponent, George Deukmejian, a white American of Armenian descent, also decided to run for the position. This was bound to be an exciting contest and polling agencies kicked into high gear to ascertain from the Californian citizens their preferred choice. Needless to say, the race took on racial overtones and, as such, pollsters were very thorough in their polling methodology. As the race heated up, week after week, pollsters were predicting that Bradley would win. In fact, just days before the election, it was a forgone conclusion that Bradley was firmly in the driver's seat. But as the results trickled in it became apparent for all, including the pollsters, to see that in fact Deukmejian was the outright winner. Analysts concluded that most people polled had lied to the pollsters. Afraid and embarrassed to be accused of being racist, they indicated to the pollsters that they supported Bradley. In the privacy of the voting booth, however, their true colors were revealed and their real support was declared for the white candidate. Another whimsical example of a survey and lying is one that found that“A third of people in the UK will not give truthful answers about themselves when asked questions by pollsters.”
So, except when the answer can be determined by means other than asking the people outright for information about how they behave, or being able to look at other information to determine whether their answers are true, how are we to know the answers to questions people might be inclined to lie about? There are several special methods for dealing with this problem:“randomized response, ”“unmatched count, ”and others. For an example of the application of such methods, consider the survey about alcohol consumption mentioned above. There, the researchers “surveyed over 40,000 people with standard alcohol survey questions about their quantity and frequency of alcohol consumption—‘How many drinks have you had in the past month? 'and so on. But in a smart twist, they then asked a more immediate question:‘How many drinks did you have yesterday? ’This method is useful for detecting under-reporting because of the improbabilities it reveals. For example, if 50% of people who say they drink once a month acknowledge drinking yesterday, one can infer that this group is severely under-reporting their consumption:If they were truly once-amonth drinkers, only about three percent should acknowledge drinking on a particular randomly selected day of the month.”
People lie, and this places limits on the utility of surveys. Further limits are introduced by the reality that“Most marketers assume that customers know what they want. Unfortunately, customers may not know as much as the customers think they do. Decision makers are not perfectly rational, but they are rationally bounded, following the term of the Nobel Prize Simon. That is, it is impossible for decision makers to evaluate all pieces of information available in the environment. Decision makers rely on heuristics to choose the most salient information and therefore are subject to biases in different parts of the inferential process.”
Given that consumers sometimes lie and sometimes do not know what they want, it seems quite a few companies and business leaders have determined that they do not care about what consumers claim they want, as discussed earlier. The companies use market studies of the kind discussed above to better target their communications, product specifications, and product-development efforts. But as to consumer wants and needs, today it is brands who dictate these, and they do it through data collection. They create the products that consumers would want and market them using powerful and persuasive tools.
The technological evolution that we have observed in AI has introduced one element which will radically change market studies:the instantaneous and continuous collection of data. Brands acquire consumers'data to understand their behavior and predict their needs. With AI and the development of the Internet of things(cellphones, tablets and more), brands use geolocalization to know where you are when you are reading the New York Times or your favorite blog, which article you love and the keywords that you like in its title, the journalists who post, the influencers who write, the pictures that come up on your newsfeed, and the time you spent on each of them. Schumpeterian creative destruction sees the elimination of old industries in order that new ones may emerge:instantaneous and autonomous, AI is the contemporary heir of old market studies. As our tastes evolve, companies continue to know everything about us through qualitative and quantitative non-stop analyses. While in the 1990s Procter&Gamble spent millions of euros on market studies with specific panels (with only hundreds of people represented), brands are now analyzing everybody, all the time, with an automatic process. Companies will soon know us better than we know each other and will have the ability to create micro-fashions within larger trends as a strategy to manipulate consumers into buying ever-more-specific products. As we will see in the schema below, there are many similarities between Nazi propaganda, the marketing of brands, and GAFA, which are linked by seven discrete patterns: selling, manipulating, controlling, proving, persuading, entertaining, and simplifying. An AI that knows everything about you could convince you to vote for the right candidate, depending on your mood that day. It will convince you that voting for that one extreme candidate is a bad idea and that you were not really considering it seriously, it is just that you had had a dispute with your wife recently and wanted to shake things up.
(continued)
Brands are producing the tools that enable one to govern the masses efficiently. With the capabilities of artificial intelligence, we can control the masses not by means of a general message, but rather a personalized one with a broader goal. In the next section, we will see the traditional techniques and strategies companies have used to sell more products, and how AI is taking its place among the complex predictive marketing strategies hastening one outcome in particular:the end of free choice in purchasing behavior.