Smart Brands in the Connected Age

The Internet of things is giving rise to “social” and “smart.” Is your brand ready to adapt?

Facebook, Twitter, LinkedIn, and other social networks are yielding unprecedented actual and virtual valuations. Social media empowers and propels social revolutions, such as the ones we are witnessing in Arab countries. Enabled by broadband technologies and mobile devices, entire industries are connecting with customers and one another in entirely new ways. Clearly, the connected age has arrived. A world population connected through ubiquitous, real-time, and social computing, and through more than 50, 75, or even 100 billion devices. A world where every thing is connected with everything.

Connectedness has become a cultural and business meme. Clay Shirky’s Cognitive Surplus: Creativity and Generosity in a Connected Age sparked it, and several authors have since elaborated on the concept. User experience expert Peter Merholz has repeatedly written about it, citing Dave Gray’s musings on the “Connected Company” and Social Business Design (see page 15) and Tiffany Shlain’s new film, Connected, a documentary that explores “the visible and invisible connections linking major issues of our time” and relates them to personal interconnectedness.

The Internet of things, with its unprecedented level of connectivity, is giving rise to both “social” and “smart.” And “smart” means complex. Increasingly, products and services are multifunctional, multilayered, and connected to a broader ecosystem of services, providing a platform for added-value applications. Companies of all kinds are beginning to develop smart solutions—smart phones, smart energy, smart healthcare, smart housing, smart mobility, and more. Smart ecosystems have emerged as the linchpin of innovative experiences—those that brands can truly own.

But what about the brands themselves? What do the new paradigms of “connectedness” and “smart” mean in terms of how employees, customers, and other constituents interact with companies and their products and services? What if “connectedness” is the new modus operandi for brands and all brands must now be “smart”?

By definition, smart systems are self-organized systems with built-in feedback mechanisms and the ability to reorganize themselves constantly to adapt to their ever-changing environments. They are capable of describing and analyzing situations and making decisions in a predictive or adaptive manner based on the available data, thereby performing smart actions. How can brands do that?

Networks

In the networked economy, marketing’s value lies in identifying and activating valuable connections, in networks inside and outside of the organization. These networks include other brands, which constitutes a whole new type of B2B marketing: brand-to-brand. Marketers need to ask themselves the questions, Which brands’ company do we want to keep? Which halos do we want? Which brands should we market to (both for partnerships and talent)? In the business-to-business space, and in particular in professional services, this kind of lateral marketing is increasingly replacing the typical buyer-targeted marketing.

And the concept of brand-to-brand goes even further: Brands must not only treat other brands like partners, but they must also market to consumers as if they were brands. Consumers have their personal brands to project and cultivate, and the image rub-off, the brand value transfer they earn by interacting with a brand, is as important a motivator as any material or utilitarian gain. Smart brands map out the network of brands of which they want to be part, and it doesn’t necessarily include only competitors. Smart, connected brands reach out constantly beyond their own industries to forge unlikely alliances at the fringes of their own networks, because today’s edges are tomorrow’s core. Or as Allison Fine, author of Momentum: Igniting Social Change in the Connected Age, puts it aptly: “It is counterintuitive but true; the more decision-making we push away from the center, the more powerful our social networks become. That’s the power-to-the-edges concept.”

Social Intelligence

Connected brands are social brands, and if they are smart, “social” for them means to be socially intelligent. The term “intelligent” comes from the Latin “intelligere,” which literally translates to “to connect” or “to interlink.” According to scholars, people have social intelligence when they are able to “get along with people in general,” and have “ease in society, knowledge of social matters, susceptibility to stimuli from other members of a group, as well as insight into the temporary moods or underlying personality traits of strangers.” Applied to brands, social intelligence can be interpreted as the art of detecting the most subtle cue in understanding an individual’s behavior and the ability to receive constant feedback and then convert it into behavioral change. The socially intelligent brand can link the social desires and motivators it identifies in “the other” and respond to them with its own palette of social interaction modes and stimuli. Isn’t marketing all about “the other,” about understanding “otherness” in order to be different(iated)? The socially intelligent brand is empathetic, trained in detecting behavioral cues, and has what you may call the “network affect,” in that it can identify and easily join conversations, and therefore recognize, activate, and move networks through its behavior.

Platform

It has become a cliché, the notion of “being a platform,” but most clichés are truths that recur. And it is definitely true that smart brands need to be not only trusted but also built upon, in other words, be a platform. If you are a platform, you have the “power of pull,” and the evolutionary forces work in your favor. This means opening up for outside influence, and it means sudden directional shifts if necessary. And it implies that your service is a utility others can leverage to create their own assets. The line here is fine, as you can imagine. Being a mere utility is the opposite of being a brand. Smart brands provide just enough value to the ecosystem to defend their position in it, but they also make sure to retain the very source code of their value.

Super-Flexibility

Smart brands operate like software organizations in the way they structure themselves and operate, shifting from a linear, static, and robust model of planning and executing on strategy, to a more fluid, non-linear, agile, and distributed approach that allows knowledge, the capital of the 21st century, to quickly flow through their networks. Stuart Evans and Homa Bahrami coined the term “super-flexibility” to pinpoint this new set of capabilities and define it as “the capacity to transform by adapting to new realities, underpinned by the ability to withstand turbulence by creating stable anchors.” They propose that instead of thinking about strategy as a single best approach, developing super-flexible strategies involves switching between a portfolio of initiatives. “Smart brands ‘maneuver’ their strategic trajectory, like changing gears in a car.” What’s more, they say: A super-flexible brand is “multi-polar, with several centers of gravity. Today it is white, tomorrow it is black. It is much like a living organism with multiple brains, but these move in the same direction, like a flock of birds or a school of fish.”

Presence

In her 1995 book, Life on the Screen: Identity in the Age of the Internet, Sherry Turkle used the phrase “distributed presence” to describe a multichannel, always-on marketing strategy to reach target audiences. Subsequently, marketing shifted from broadcasting to narrowcasting, from mass communications to social distribution, from prime time to real-time, from paid media to earned (or increasingly) owned media, and from awareness to engagement. With the burgeoning age of hyperconnectivity, it may evolve further: Presence is now the non plus ultra of all marketing efforts. Brands that are highly connected are able to be at the right time at the right place; they are omnipresent because they deploy multiple channels and are able to cover all relevant networks. They are like a rubber band stretching in multiple directions while not breaking. This concept of presence allows brands to master what my colleague Adam Richardson, writing for the Harvard Business Review, has called “preemptive knowledge management”—the awareness of knowledge inside or outside of the organization before it becomes externalized. This gives smart brands a crucial competitive advantage: They are “in the know” about the lives of their customers, but in a different way than before. It used to be that knowledge was power. In the connected age, the real power comes from fast knowledge, faster than in real-time. Presence, in this case, is the absence of visibility, it is all intuition.

Unpredictability

Smart brands are also good at dealing with events that are unpredictable. As Peter Merholz writes, “Businesses must grapple with the messiness of humanity, because when people are freer to interact, unpredictability occurs. And the decentralized networks that form the substrate of the Connected Age lead to emergent properties that, by their very nature, are also unpredictable.” Unpredictability is the new brand consistency. Good brands stay unpredictable and help their organizations embrace the unknown. Management performance shall not be measured by how much uncertainty it can eliminate, but how much uncertainty it can tolerate.

Given all that, ask yourself: Is my brand adaptable, connectable, and sociable? Can it be easily upgraded? Does it, like a smart system, bring together interdisciplinary approaches and solutions in an integrated design? And does it have the courage to ignore the formulas offered by analytics? It seems counter-intuitive but the connected age is not the age of data. Smart brands remain ephemeral for they know that brands, despite the deluge of data at their disposal, are more substance than shape, more chaos than structure, and more intuition than knowledge. They are viral because they are driven by passionate people, and their passion spreads through the connections they activate. They make a lasting impression because they have the ability to connect people with people, people with brands, brands with brands, stories with people, stories with brands, and stories with stories, all the while constantly evolving their repertoire of interactions based on their intuition and the faster-than-real-time feedback they receive from the members of networks they own, activate, or join. Hyperconnected, hypersocial and omnipresent, they can anticipate desires, sense mood shifts, pre-empt knowledge, and quickly direct attention to significant events and conversations—because whenever something happens or is being talked about, they are already there.

Tim Leberecht is chief marketing officer of frog and its parent company, the Aricent Group.