THE BLOG
09/26/2013 11:01 am ET Updated Nov 26, 2013

Being Phygital

I've worked in New York City my entire adult life -- at Goldman Sachs and Spy magazine in the seventies and eighties, ESPN.com and Google in the nineties and aughts, and now Dstillery. Nothing has changed my experience of the city so dramatically as CitiBike. Like most American workers, I'm a commuter. And like most New York commuters, I have endured many years of being jostled and hustled and crammed on trains and subways.

But now there's CitiBike. I joined the program this summer. And now the final leg of my morning commute is an exhilarating ride down Park Avenue. In the evening, I dash up Park Ave., slipping past taxis and buses and delivery vehicles. My commute is a joy, and I feel more in touch with the city than I have since my early days here.

What makes this possible? CitiBike is a charmed marriage of the physical and digital worlds -- something we like to shorthand as "being phygital." There's great physical infrastructure -- 330 street stations with 6,000 bikes -- combined with a simple intuitive phone app that finds you the nearest station and tracks bike and rack availability.

And CitiBike isn't the only great example of this marriage. There's the Uber car service, AirBnB room rentals, Waze mapping, FourSquare check-ins, even my weather app from Weather.com.

All this phygital stuff is being developed to make people's lives better and more fun. Everyone wins, right? But these are all consumer applications. So, why isn't some of this phygital innovation finding its way into the marketing arena?

The good news is that it's finally beginning to happen.

What does being phygital mean for marketers? The digital part has taken years to develop and refine, as the machinery for extracting brand signals from Internet browsing behavior (masses of it) requires creating and tuning sophisticated algorithms to help marketers find the people most likely to engage with a brand.

But that Internet browsing behavior is just part of the story. If we really think about a consumer's journey, and what she does in a day that could be a marker for brand affinity, there are lots of other places to look. First and foremost, that consumer has gone mobile, and there's as much to learn from smartphone and tablet apps as from the rich fabric of Internet browsing. But the biggest breakthrough is marrying location data to the treasure trove of digital data that is already being mined today.

What do we mean by location data? Does this mean following consumers wherever they go? Not even close. But there are discrete moments in the course of a week or a month or a year when location is telltale, when I'm saying that I'm in the market and ready to buy if anyone cares to listen. Last summer, I visited six auto dealers before buying my Honda Pilot; every month since I can remember, I've taken an average of four business trips involving two airports each; and, if I were that kind of guy, you'd find me at the shopping center every Saturday, the golf course every Sunday and a ski resort several weekends in the winter.

Of course, marketers have always paid attention to location data. But until the recent introduction of several enabling technologies, location has really informed only the out-of-home advertising strategy. Now marketers have the ability to tie that location data -- and the broader mobile intelligence -- to all digital advertising. Browsers and apps. Desktop and mobile. Even, in time, smart TVs and digital out-of-home.

And the real kicker comes when we combine these massive data sets. When Internet browsing and app usage and terrestrial visits -- the complete consumer journey, all anonymized -- are distilled to produce the purest brand signals, and the purest audience.

That's what we're excited about. It's being phygital for marketers. Finally.