THE BLOG

The Rise of the Circular Marketer

05/08/2014 13:32 BST | Updated 04/10/2014 10:59 BST

Twenty years from now, people involved in marketing will look back on the early 21st Century and smile at how straightforward marketing used to be; a time when all we had to worry about was how to persuade people to want something enough to buy it. There are very good reasons to believe that the nature of marketing is going to change radically over the coming decades... and that it will change for good.

The case for radical change starts with a rather depressing (and, yes, inconvenient) truth: our economy isn't sustainable in its current form. According to the World Resources Institute, global population will grow from around 7 billion today to 8.3 billion people in 2030. The world's middle classes are expanding rapidly, meaning the world will need to produce around 35 per cent more food, 40 per cent more water and 50 per cent more energy, whilst struggling to mitigate and adapt to climate change.

Incremental efficiency gains from technological innovation might reduce the rate of resource depletion, but they don't solve the riddle of how to create and sustain indefinite economic growth given finite and, in some cases, rapidly depleting resources - what pwc calls a "ticking time bomb". A more fundamental change is required. Not in terms of technology (although this will play a big part) but in terms of mind set.

This isn't about using more efficient technology to minimise waste. Instead, it involves eliminating the concept of waste altogether. In the words of David Schelin, CEO of recycling company Ragn-Sells, "waste is simply resource in the wrong place." This is the fundamental premise (or promise) of what we have come to call the "circular economy". One man's trash will become another man's treasure. This isn't as idealistic or impossible as it sounds. In fact, it's commonplace in developing economies, where the informal recycling and upcycling sector is a significant source of income for the urban poor. It's very likely that a formal equivalent will emerge in developed countries.

The implications for anybody involved in marketing will be profound. We will need to change how we think about many of the basic concepts marketers deal with every day: concepts such as identity and desire, loyalty and reward and trust and transparency. These changes represent an enormously exciting opportunity to reinvent the role of marketing. The moment we stop thinking about waste, a plethora of possibilities present themselves.

Identity and desire

We define ourselves in part through the things we own and hold dear to us. The stuff we buy and own becomes a part of our identity - our homes, our clothes, even our choice of soft drink reveal something about us. We desire things that either provide the best reflection of how we see ourselves, or embody the ideal of how we aspire to see ourselves. Ownership is fundamental to desire: the car I own says more about me than the car I rent on holiday, the car I borrow from a friend, or the VW Golf that Zipcar stores around the corner from my house.

The move towards a circular economy will depend in part upon people owning less stuff. Sharing and leasing models are vastly more efficient ways to use resources and eliminate wastefulness than individual ownership. This creates a new challenge for marketers: how to make people desire something they will have access to but never own? Something that they will most likely share with other people? What will that Gucci coat say about you when you see the kid next door wearing it a month later? These are fascinating questions for talented marketers to answer. In future, people may come to define themselves by the services they subscribe to, rather than the products they own: I won't feel like I'm a member of an exclusive club because I drive the latest BMW; I'll drive the latest BMW because I'm a member of an exclusive club.

Loyalty and reward

The idea of brand loyalty has existed since the 1950s, when two US researchers, Ross M. Cunningham and George H. Brown, identified clear patterns in the way that people purchased brands of various products. This is how marketers tend to think about loyalty: the tendency of some consumers to continue buying the same brand of goods rather than competing brands. Consequently, loyalty schemes reward people for buying more stuff. For example, most supermarket loyalty schemes reward shoppers as they spend more.

This will change in a circular economy, because "buying more stuff" won't be the only behaviour brands will want to influence. Tesco won't just deliver your shopping in a circular economy: it also will take your empty packaging and uneaten food away, because your empty packaging and uneaten food will have a value. Perhaps the food will be converted into biodiesel to power the delivery van. Perhaps the packaging will be reusable. Either way, Tesco won't just compete for your loyalty as a shopper: it will also compete for your loyalty as a supplier of raw materials. Its loyalty scheme will need to change accordingly. No longer will you be rewarded just for buying stuff. You'll also be rewarded for your loyalty as a supplier of insight, advice, recommendation and raw materials. The role of the marketer will expand accordingly: as well as using brands to influence customers and employees, marketers of the future will also apply their talents to improve the relationship between a business and its suppliers.

Trust and transparency

This two-way relationship will require significantly more trust than the supplier-customer relationship that currently dominates. At the moment, I need to trust Tesco not to sell me horsemeat instead of beef, not to screw up my shopping order and not to share all of the information it knows about my shopping habits. In a circular economy, my concerns over horsemeat should be mitigated by greater supply-chain transparency. But in terms of my personal data, a far greater level of trust will be required.

If you want to get to know someone well, just go through her rubbish bins. In the US, this practice is so common amongst a certain section of the population that it is variously known as a "trash hit", "dumpster diving", "garbage confiscation" and "refuse archaeology". In some US cities, "dumpster diving laws" prevent people going through your rubbish. Imagine how you would feel if you discovered the man who delivers your shopping rummaging through your garbage. The contents of your (recycling) bin are more than physical resource: they are valuable data. Today, Tesco can tell if I buy two ripe avocadoes a week and can offer me a two-for-one deal on ripe avocadoes. If Tesco could also see that I throw away one over-ripe avocado a week, then it could suggest I refrigerate one of my avocadoes, or have my fruit and veg delivered in smaller quantities more frequently, or could simply suggest that I buy fewer avocadoes. The stuff we no longer want tells a story about us. And any brand that wants access to this information will need to earn a significant amount of trust.

There's also a flipside to greater transparency. It will reassure me that my Big Mac is made from 100% beef, but it will also alert me to the fact that my "new" washing machine is made from 90% reconditioned or remanufactured parts from old washing machines. There are clear benefits to this, since the washing machine should be both cheaper (since raw material costs should be lower) and more reliable (because its components are already proven to work) - but persuading me of these benefits represents a significant challenge for people marketing that washing machine. Transparency isn't always desirable. Imagine knowing exactly how many people had slept in your hotel bed (and how many at the same time). Imagine knowing that the gold in your wedding ring used to be someone's tooth. Our concept of "old" and "new" will need to evolve. Marketers of the future will find ways to persuade potential users of the advantages of repurposed, reconditioned and remanufactured products. And they will make these products more desirable and more aspirational than box-fresh equivalents.

The move to a circular economy will happen sooner or later. A proliferation of innovative products, services, brands and businesses already exists that point to this end: Autolib and Girl Meets Dress; Airbnb and Philips' Pay per Lux. The practice of marketing will become more difficult, but it will also become vastly more exciting and rewarding. The marketing community is constantly searching for meaningful ways to interact with people. The circular economy represents a fantastic opportunity to establish a more productive, more intimate relationship between people and businesses. Marketing and branding professionals can play a big part in advancing circular business models as a more aspirational, intelligent, sustainable way of life. We have the insight, the imagination and the wherewithal to make the circular economy a reality. We just need to point these in the right direction.