Preface: Running with the Centaur

"A businessman is a hybrid of a dancer and a calculator."

—Paul Valery, French Poet and Philosopher

The Internet revolution didn't turn out to be anything like we thought it would be. At the end of the 1990s, the discussion of many observers, we among them, focused on the rise of the "cyberconsumer" and the emergence of "Internet marketing." At the extreme, the image of this cyberconsumer was humorously caricatured in a series of Sprint commercials introducing its wireless web, in which people hunched over their computers in dark rooms were invited at long last to step out into the sunlit world. The business model designed for the cyberconsumer was the "pure play" Internet firm, either a separate dot-com or a stand-alone division of a larger company. But the cyberconsumer was largely a myth. Consumers didn't behave anything like we thought they would.

Today, we are entering the age of the centaur. Consumers act across multiple channels. They combine timeless human needs and behaviors with new online activities. They are like the centaur of Greek mythology—half human and half horse—running with the rapid feet of new technology, yet carrying the same ancient and unpredictable human heart. This consumer is a combination of traditional and cyber, rational and emotional, wired and physical, as illustrated in Exhibit P–1. This consumer is not either/or, but both.

The authors came to this center from opposite directions. Jerry Wind was an early champion of digital marketing, highlighting the revolutionary changes of the Internet on consumer behavior, marketing and business strategy. He urged executives to consider the potential of this new technology to transform their businesses. Vijay Mahajan pointed out that not everything had changed, and that many aspects of consumer behavior and marketing remained the same. He urged executives to consider the enduring human characteristics that would continue to shape marketing and business strategy. As we discussed the issue from these two viewpoints, working on a series of projects that led to this book, we came to the conclusion that we were both right: the reality was the hybrid consumer.

Exhibit P-1. the Hybrid Centaur

This is not to suggest that there are three separate segments (traditional, cyberconsumer and centaur). The reality is convergence. The entire market is becoming centaurs, either directly or indirectly (even if someone is not online, their behavior will still be affected by new technologies, channels and products, and service offerings). This is why we focus so much on the centaur. The centaurs, in turn, are heterogeneous, so there will be many segments among these hybrid consumers.

Even the most tech savvy of U.S. consumers—the 18 to 25 year olds of Generation Y—are not strictly cyberconsumers. A recent survey of more than 600 Gen-Y respondents (51 percent of whom had made online purchases in the past year) found that nearly 40 percent learned about the product online, but bought at a physical store, whereas only 9.3 percent began and ended their search online. When asked where they would prefer to shop, nearly three-quarters chose a store rather than online.^[1] Across the spectrum, consumers are combining various channels and approaches, searching online to buy offline, searching offline to buy online—and everything in between (see Exhibit P–2). Charles Schwab found that while about 90 percent of all trades are handled online, 60-70 percent of new accounts are set up in branch offices.^[2] People want to be able to see whom they are working with when they turn over their money.