IBM ExperienceOne Digital Darwinism and
the Dawn of Generation C by Brian Solis

Digital Darwinism and the Dawn
of Generation C We live in an era where connectedness is becoming a way of life. With the pervasiveness of smartphones, tablets, online access, and social networks, it’s easy to see, for better or worse, how we’re becoming an always-on society. This is where our story begins. This newfound connectedness is changing the dynamic of digital relationships and is already starting to affect business in ways that we may not yet realize. This is a time when businesses must not underestimate or under appreciate changes in behavior but, instead evaluate how these trends impact markets now and in the long term. On the subject of connectedness, I would like to take this time together to officially introduce you to Generation C and the important role these connected customers play in the evolution of your business. Yet another generation that requires study? you ask. What’s this Generation C all about anyway? Is this really a bona fide business opportunity or merely a fad or, worse, another marketing gimmick? The truth is that Generation Cers are among the most important customers to the future of your business. They represent both a threat and an opportunity, but that’s just the beginning. Gen C will challenge your entire approach to customer engagement today. These digital natives are connected, discerning, informed and elusive. And they’re among the most loyal customers you could hope to attract. There’s just one thing you need to know about Gen Cers before we dive in: they are not a group bound by age but, by connectedness. Gen C will challenge your entire approach to customer engagement today. 1 2 3 4 5 6 7 Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 2

Digital Darwinism and the Dawn
of Generation C Several years ago, Mollie Sterling shared a picture of a classroom at her alma mater, the Missouri School of Journalism. The picture eventually went viral, and in 2008, Apple used it in a press conference announcing a next-generation MacBook event. Sterling’s picture is more than an unintentional advertisement for Apple. It represents the emergence of Generation C, a human network that efficiently relays information, emotion and experiences in real time. How that network uses technology has changed it, which, in turn, will change us as marketers and business professionals. As Gen Cers increasingly focus on living the digital lifestyle, chasms emerge between where their attention is focused and where and how organizations currently apply sales and marketing efforts. This is important because the digital divide that’s emerging will prevent businesses of the future from effectively learning from, influencing and participating in decision making. Generation C is an audience with an audience of audiences Missouri School of Journalism circa 2007. Source: Global Nerdy Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 3

Digital Darwinism and the Dawn
of Generation C With the proliferation of social networks such as Facebook and Google+, micro social networks such as Path, curation networks such as Pinterest, and information networks such as Twitter, every new friend, like,and follow helps individuals create their own personalized digital ecosystems, or “egosystems.” The egosystem is where Gen Cers are literally at the center of their online experiences. The people, brands and celebrities they follow revolve around them. As a result, a marketing audience that was once captive is now universally connected, difficult to reach, and engaging online—with or without you. It is a flourishing and influential audience that businesses are not desig- ned to connect with today. To reach vast audiences in the past, businesses invested in mass media campaigns online, in print, over the air, and in person. But by the very nature of the egosystem, businesses must now augment this approach to genuinely reach and engage people in connected domains where customers are kings and queens of their own castles. Reaching Gen C is a tremendous opportunity to engage a connected audience in a more meaningful way. Rather than marketing to a traditional audience, you’re presented with an interconnected landscape of customers who individually boast a personal network of their own. On average, an everyday person on Facebook is connected to at least 150 people. On Twitter, that average is around 140. Instead of simply reaching people in a traditional one-to-many approach, you now can reach customers through a one-to-one- to-many model. And if your strategies are personalized to match behavior and expectations and are engaging in design, you can rouse and activate not just an audience, but a connected audience with an audience of audiences. Individuals create their own personalized digital ecosystems, or “egosystems.” Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 4

Digital Darwinism and the Dawn
of Generation C On average, an everyday person on Facebook is connected to at least 150 people. On Twitter, that average is around 140. Facebook has over 900 million people who inhabit what would be the third-largest country in the world. Twitter has over 200 million. Over 48 hours of video are uploaded to YouTube every minute. Ever heard of Tumblr? The popular microblog is host to 38,000 new posts every 60 seconds. Facebook has over 900 million people who inhabit what would be the third-largest country in the world. Twitter has over 200 million. Over 48 hours of video are uploaded to YouTube every minute. Ever heard of Tumblr? The popular microblog is host to 38,000 new posts every 60 seconds. If a picture is worth a thousand words, Sterling’s picture is worth a thousand impressions. Every single one of those students represents a new breed of connected customers who are linked to others just like them. In fact, the picture is as remarkable as it is dated. Today, that audience would show a mix of laptops, tablets, and smartphones. The people who make up Gen C are the nodes in a human network, playing an instrumental role in the dissemination of information and the experiences that unite them online and in real life. Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 5

Digital Darwinism and the Dawn
of Generation C The people formerly known as the audience We live in interesting times, and the dose of reality contained in Sterling’s photo is both intoxicating and frightening. The classroom, however, is merely one setting in which we can expect to see the impact of connected individuals and the networked audiences they weave. The audience with audiences is the new market opportunity; it defines the new consumer landscape: how businesses connect with consumers, how governments connect with constituents, how movements rally supporters and how news spreads are forever changed. My good friend and New York University journalism professor Jay Rosen famously wrote in 2006: “We are the people formerly known as the audience.” His work served as the stimulus for humanizing the audience, challenging content producers and brands to consider the very people they were attempting to reach so as to earn personal connections and galvanize meaningful interaction. And now the audience has ripened to earn an audience of its own. To connect with this audience requires study to appreciate its effect. The currency of the digital economy isn’t money; it is attention. And to capture the attention of connected consumers requires an understanding that they are impervious to anything that doesn’t clearly offer value in exchange for ongoing attention and connection. The audience with audiences is the new market opportunity. It defines the new consumer landscape. Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 6

Digital Darwinism and the Dawn
of Generation C Remember that at the heart of the egosystem is a connected customer, a sophisticated, discerning, and empowered consumer. This new consumer is compli- cated but distinguished. Technology allows us to learn about what’s important what’s not important to them. They are symbolized by the events they attend, the brands they love, the products they buy, the news that grabs their attention, the activity they see and interact with in the various social streams across multiple devices, and the interests and relationships they share. The audience with audiences is bound by sharing under the philosophy, “I’m living this right now, and I want to share this moment with you so that we can experience it together.” But it’s more than just a philosophy. A real psychological need to share starts to develop with prolonged sharing. As individuals cultivate their networks, the once-casual care and feeding of them naturally develops into a mandatory responsibility. The truth is that individuals feel disconnected from their audiences when they are not interacting with them. These digital exchanges create a sense of connectedness and relevance. As a result, our attention is constantly lured from the physical to the virtual realm to manage our networks and the experiences we’re compelled to share. Is this behavior a reflection of introverted socializing, or is it a sign of something more remarkable? It’s both. Online interaction instills a sense of confidence with every action, reaction, Facebook like, Twitter retweet, foursquare check-in, YouTube view, or friend request we earn. In a sense, we move one step away from online introvert and one step closer to becoming digital extroverts. With each update we publish, we’re validated and motivated. And over time, the audience with an audience of audiences becomes increasingly powerful, connected and influential. The job of anyone trying to reach the people formerly known as the audience carries great burden and opportunity. The challenge and the objective now are to speak to and through connected consumers simultaneously. The idea, of course, is to share value and ideas across social networks to those with whom they’re connected around the world. The psychology of the audience with audiences These digital exchanges create a sense of connectedness and relevance. Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 7

Digital Darwinism and the Dawn
of Generation C Regardless of our age or any other demographic element, we are becoming part of Generation C. We are becoming the very people we’re trying to reach. This is the just the beginning of a new level of understanding necessary to identify human informa- tion networks. To reach intended audiences through audiences with audiences represents the state of how information now travels and affects the next steps and decisions of all that information touches. Just think, you might not have ever downloaded this ebook if you hadn’t seen it in your social stream. That’s how we’re becoming increasingly connected and how you and I, regardless of our age or any other demo- graphic element, are becoming part of Generation C as individuals. Essentially, we are becoming the very people we’re trying to reach. Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 8

Digital Darwinism and the Dawn
of Generation C This ebook and our time together is intended to introduce you to a new era of connected consumerism. We have been presented with a new category of consumers that requires identification, study, and understanding. More importantly, it requires new or adapted strategies, channels and approaches to effectively engage them. Even though digital DNA is a common trait among connected customers, it is the behavior and expec- tations of Gen C that will help you succeed. This isn’t the time to use technology to drive strategy, but to use it as an enabler of informed and engagement- worthy programs. Your next steps following this ebook are not to devise new social media or mobile cam- paigns, but instead to rethink how you approach all digital efforts supporting sales, marketing, service, and product development. To survive and thrive in a new era of connected consu- merism requires a shift in strategy and perhaps culture to both react to new opportunities and eventually lead desired experiences and outcomes. Marketing disrupted Disruption is a powerful thing. While we’re learning about the importance of technology and how it’s changing how people connect and discover, we may be missing the very things affected by disruption: customer behavior and their resulting expectations. The IBM study Capitalizing on the Smarter Consumer looks at ways retailers can meet the demands of the smarter consumer. The study reveals that these smarter consumers in fact have higher expectations. The two improvements consumers state they would most like to see are: • Personalized promotions and consistently available products • Better value, quality and variety Your next steps following this ebook are not to devise new social media or mobile campaigns but instead to rethink how you approach all digital efforts. Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 9

Digital Darwinism and the Dawn
of Generation C We live in a time of digital disruption, and Gen C is the latest manifestation of how businesses need to evolve. Social media, smartphones, tablets and portable Wi-Fi hotspots all contribute to a digital lifestyle that is connected, always on, and incredibly informed. The result is a new level of customer empowerment. The digital lifestyle is particularly important as businesses increase investments in social networks, mobile apps and new technology. Without zeroing in on the root impact of disruption, businesses may be missing tremendous opportunities or, worse, making an investment in what I refer to as digital Darwinism. Indeed, the digital lifestyle that’s captivating your customers is, in fact, changing your customers. And without looking beyond the technology that’s causing this shift, we cannot see the impact of trends on actions, decisions or impressions. Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 10

Digital Darwinism and the Dawn
of Generation C Customer behavior and expectations are evolving. They expect to engage your business and all it represents in new channels... their way. Traditional Consumer Digital Consumer CONNECTED CONSUMER The audience with an audience of audiences may seem abstract. But people are connecting to one another, growing their networks and egosystems their way. That’s why I’m working with IBM to publish this ebook. The behavior of Generation C is different than that of the customer segments businesses are designed to entice. We’re making an investment in the future of your business, and it starts with recognizing that Gen C is a new additional customer segment to target. With The End of Business as Usual, I was trying to communicate the importance and extent of the new landscape for consumerism. I learned through my research and experience over the years that aside from the myriad ways we can slice customer data and behavior, one simple way to look at balancing the marketing mix was by organizing customers into three groups: traditional, digital and connected. Source: Brian Solis, Altimeter Group, 2012 A market in transition Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 11

Digital Darwinism and the Dawn
of Generation C What defines these groups you will need to connect with in new ways? Traditional customers are those who are comfortable with pervasive media, such as newspapers, radio, TV and magazines. They trust the advice of experts and friends, and are influence by the research they do offline and online. Digital customers are those individuals whom businesses have learned to engage over the last 20 years or so. They balance traditional and digital media. They rely on websites for information about current events and products they’re interested in. Email, text and instant messaging are the preferred methods for online interaction. They typically jump to Google or another search engine to begin a discovery process. Online reviews and word of mouth with trusted friends and experts shape decision making. This group also is migrating toward social and mobile media and increasingly adopting portable connected devices, such as tablets and smartphones. Connected customers represent Generation C. These connected customers dwell in their ego- systems. They discover, learn, communicate and share in public forums. Gen Cers place value not on friends and family but on strangers and authorities in their social networks that share similar interests. They see the world differently and share all experien- ces, whether it’s in the real world or online through their social and mobile networks. Online connections and shared experiences factor into decision making. Gen Cers can be likened to digital exhibitionists: everything they do, think and experience is shared through multiple networks. The market is in transition, moving from wired to wireless, connecting people and information along the way. For at least the next 10 years, organizations will need to shift the balance of their sales, marketing, service and development initiatives in varying ways across these distinct groups. Each is in its own way important to the success of your business. Sliding resources and investments between them over the coming years is how your business will effectively compete for the future. Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 12

Digital Darwinism and the Dawn
of Generation C How Gen C sees the world. Source: Brian Solis, Altimeter Group, 2012 Their networks are: • How they learn about current events • How they learn about new products • How they share what they love or what captures their attention • How they bridge the virtual and digital worlds • How they shop • How they build relationships with organizations that acknowledge them These are elusive but plugged-in customers. They see the world differently. To engage them requires us to adapt our view of the world and see decision making through their eyes and screens. If we don’t, we’ll miss opportunities. And the more opportunities we miss, the greater the opportunity cost will be to the future of our business. The connected customer sees the world differently, uniting the online and offline world for others to see and experience Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 13

Digital Darwinism and the Dawn
of Generation C Survival of the fitting Digital Darwinism. Source: Brian Solis, Altimeter Group, 2012 So what is digital Darwinism, and why is it important to you? Digital Darwinism is the evolution of consumer behavior when society and technology evolve faster than some companies’ ability to adapt. Generation C is the current manifestation of technology’s impact on society and business. Investing in technology to improve engagement in relatively new and emerging channels such as Facebook, Twitter, Pinterest and Google+ isn’t nearly enough. These wildly popular networks are among the channels where people are coming together. But they’re also the catalysts for a new era of connected consumerism, and these networks, the devices used to access them, and those yet to emerge are changing how customers learn about you and how they’re influenced to make decisions. At some point, this new behavior disrupts business ecosystems to the point where organizations either adapt or become extinct. Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 14

Digital Darwinism and the Dawn
of Generation C Powerful and sobering, these messages should not fall on deaf ears. If we step back and look at the changing business landscape, we may be surprised at how many of the brands we grew up with are gone or dying. In the last several years alone, we’ve witnessed the severe hobbling or outright demise of seemingly invincible brands in the U.S., including Blockbuster, Circuit City, Borders Books, Tower Records, Pontiac, Saturn, Palm and many others. Digital Darwinism is a merciless reality of business, and other iconic brands are at risk of irrelevance. Again, it’s not the networks that will save your business; it’s the study of behavior and how your connected customers are influencing the behavior of others toward or away from you. Edward Lawler and Christopher Worley made a startling observation in their book Built to Change: “An analysis of Fortune 1000 corporations shows that between 1973 and 1983, 35 percent of companies in the top 20 were new.” The duo’s work revealed that the number of new companies rose to 45 percent between 1983 and 1993 and jumped to 60 percent between 1993 and 2003. The authors asked an important question, one that deserves due diligence: “Any bets as to where it will be between 2003 and 2013?” As I was writing my latest book, The End of Business as Usual, I stumbled across one of the most disturbing and eye-opening observations on the subject of business evolution that really crystallized Lawler and Worley’s work. An ad produced by Babson College, a U.S.-based business school, stated that “over 40 percent of the companies that were at the top of the Fortune 500 in 2000 were no longer there in 2010.” Over 40 percent of the companies that were at the top of the Fortune 500 in 2000 were no longer there in 2010. Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 15

Digital Darwinism and the Dawn
of Generation C This is the time to lead, not just react. In summary: The connected marketer It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change. The point of digital Darwinism is that consumers will force a natural selection of businesses fittest for survival. Not every business will make it. But with conviction, hard work and vision, you will start to uncover how evolving customer behavior and expec- tations impact your business. More importantly, you’ll possess the insights necessary to save your business from the perils of digital Darwinism and lead a charge that more effectively shapes and steers customer experiences. While paraphrasing Darwin’s Origin of the Species, Leon C. Megginson said: “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.” The sea change in consumerism is indeed important. While it is overwhelming to think that your customer base is shifting underneath the foundation of your business, it is to varying degrees already happening. But what works against you also works for you. Generation C is indeed connected, informed, and empowered. Equally, because you’re reading this ebook, you are already on your way to becoming the business counterpart to Generation C: the connected marketer. Many businesses see this transformation through a technology lens. They’re jumping into social networks, building mobile apps, socializing customer service, and crowdsourcing product innovation. But they do so because they’re reacting to technology trends and not taking the time to study how these trends impact customer behavior and expectations. While their work is to be celebrated, it may not be enough to survive digital Darwinism. In the long run, these current strategies will be looked on as impulsive, not thoughtful or genuine. Generation C is an audience with an audience of audiences The people formerly known as the audience The psychology of the audience with audiences Marketing disrupted A market in transition Survival of the fitting In summary: The connected marketer 16

Digital Darwinism and the Dawn
of Generation C About IBM ExperienceOne IBM ExperienceOne helps you attract, delight and grow the loyalty of customers by enriching the ways you engage each of them. IBM ExperienceOne provides a set of integrated customer engagement solutions that empower marketing, merchandising, commerce and customer service teams to identify the customers and moments that matter most, and to rapidly apply those insights to develop and deliver personally rewarding brand experiences. IBM ExperienceOne ignites innovation by leveraging patterns of success from more than 8,000 client engagements, original industry research, and products consistently recognized as industry leaders in major analyst reports. IBM ExperienceOne solutions are delivered in cloud, on premises, and in hybrid options. For more information To learn more about IBM ExperienceOne, please contact your IBM representative or IBM Business Partner, or visit the following website: ibm.com/experienceone.

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