SXSW: The new marketplace; why brands and algorithms need to work together

Sarah Homewood
By Sarah Homewood | 12 March 2016

Brands need to understand how algorithms work in order to succeed in the new marketplace, with the likes of the supermarket shelf now being replaced with Google’s front page.

Head of strategy for the agency Huge, Martin Harrison, explained that in some cases brands have completely stepped back from this online marketplace by allowing retailers to completely own how their products are viewed.

Harrison was speaking on day one of South by South West’s (SXSW) Interactive Festival and he says that he was surprised at how little brands invest in understanding the consumers world.

“Yes they’ve spent millions on an e-commerce site, they have huge backends and CRM systems, but when you look-up buying a product online, brands completely stand back and let retailers own the experience,” he says.

Harrison explained that since the 1800’s branding has been an identifier of quality, which is why Google even weights its algorithm towards them, so they rise to the top.

With Harrison quoting former Google CEO Eric Schmidt as saying: “Brands are the solution, not the problem…Brands are how you sort out the cesspool.”

However, brands need to understand how algorithms, both open and closed, can work for them.

“You need to know how these things work, and you need to work with these things so that route to market is available to you,” Harrison says. “I haven't seen many brands do this particularly well,” he added.

When it comes to if algorithms can become brands themselves the jury is still out, with Harrison saying that “Can algorithms provide a promise of quality - yes, can they provide a promise of difference - yes, but can they provide a broader sense of values, behaviours and products, I’m not 100% sure, they’re not as mature and sophisticated as brands yet.”

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