Marketing 3 0 Resistance is futile

Marketing 3. 0 Resistance is futile. . . Guy Iannuzzi President, Mentus December 3, 2011 guy@mentus. com

Marketing… • The past, present, and future of marketing – What’s changed – What’s not – What’s ahead • Accelerated evolution of marketing tools • What hasn’t worked

Marketing Eras Ancient History – Product centric Era Marketing 2. 0 Yesterday – Customer-centric Era Marketing 3. 0 Today/Tomorrow – Relationship-centric Era • Marketing 1. 0 • •

Marketing 1. 0 “The Industrial Age” • Product centric Era – – – Product Focus Selling, the “art of persuasion”, cheating Top down, one way, mass communication The relationship is a commodity The marketer owns the relationship

Marketing Paradigm. . . “A Seller’s Market” • One way – marketer to consumer – Companies serve shareholder • Maximize profits – Customers are rational • Informed by sellers • Marketers have the power • Marketers build the brand

Henry Ford

Marketing 2. 0 “The Information Age” • Customer-centric Era – – Information Technology driving marketing Customer Focus Product value defined by customer Developing relationships with customer

Marketing Paradigm Customer-centric Marketing • Customer not a participant, but the “target”. . . • Sophisticated, more effective digital tools – Enable marketer to know everything about the customer – Enable effective top down, one way communications • Positioning enables manipulation of perception • CRM becomes customer relations manipulation

“A Buyer’s Market” “Today. . . we have moved beyond the information age to the age of participation”

Marketing 3. 0 “The Participation Age” • Participation Era – Relationships driving marketing – Product value defined by customer’s relationships – Customers buy the story attached to your product. . and the story is easy to find. – Customers look to friends for product advice

The Web Becomes Social • Social media gives consumers direct input to brands. • Consumers moving from the informational web to the social web. • The internet has started to move from the ‘what’ to the ‘who, ’ moving from wisdom of crowds to wisdom of friends. – We get our news from friends and family. – We find jobs from people around us. – We trust our friends more than we trust the critics.

Social Media Stats • 3 out of 4 Americans use social technology • 2/3 of the global internet population visit social networks • 61% of American adults look online for health information

History of Social Media

Key Social Media Tools • • Blogs Social network websites (Linked. In, Facebook) Microblogs (Twitter) Image share portals (Flickr) Video share portals (You. Tube) “Mash up” websites (user-customized portals) Third-party review & Check-in sites (Yelp, Foursquare)

Twitter • 31% of users follow a brand • Over 7, 800, 000 brand recommendations per month

You. Tube • It is the most powerful on-demand communication platform in existence (OPA study) • It has the potential to be viral • It’s high impact

Facebook 750 million

Linked. In • 90 million members in over 200 countries. • Executives from all Fortune 500 companies members. • Purely professional social media forum – Makes it integral to any social media plan

Social Media Rules Key drivers of successful social strategies: • • • Immediacy It’s a conversation, not a campaign Must be based on core business goals Must scale across the organization Authentic consumer input

Testing markets Brands build trust, test markets with immediate social feedback CASE STUDY: Nexxus • Hair care brand Nexxus used social media to test the market • New Pro. Mend product line to reduce split ends in a few uses – Nexxus reached out to existing brand advocates to test their claim – Asked them to test a free sample and write a review – The product passed the test • Pro. Mend launched with reviews of 4. 4 to 4. 7 stars – Nexxus posted reviews across ad channels and retailers’ websites • Feedback helped market the product and validated bold claim – Saving them money in potential product returns – Ensuring their ongoing consumer trust

It’s a conversation, not a campaign. • Old marketing talked to consumers. . . • Today more conversation is between consumers –. . . than between brand consumers • Often consumer leads the conversations. . . – Marketers learning to listen, communicate, and share • Scale increases exponentially as more social tools become mainstream

Core Business Drivers Social initiatives must be based on core business goals

Core Business Drivers CASE STUDY: Nationwide Insurance • Aligned with core goal: sell more auto insurance. • Gaining executive buy-in – Five core areas important • • • Governance Monitoring Engagement Commerce Measurement • Reviews launched in 2009 saw average rating 4. 7 stars • Tremendous success: – 40%+ quotes and 103%+ visitors looking for agents

Core Business Drivers CASE STUDY: P&G • Consider business objectives and support them. • “Everybody’s speed of choice is one click away” – “Consumers can make product decisions in a click. • “Retailers can change their product offerings online in an instant, manufacturers can provide new content in a click – all this takes weeks or months in a store environment. ”

Core Business Drivers One of the most acclaimed viral campaigns of 2010 was the Old Spice Viral Campaign. . . 186 customized video responses led to 107% increase in Old Spice Body Wash sales over the last month

Social media must scale Recommendations: • Social media requires new types of organizations – Usually crosses departmental borders • Get ready internally – Focus first on governance and process – Then on education to emerge as a center of excellence. – Standardize with social media management systems

Authenticity • The authentic consumer voice can have a huge impact on brands. • The marketer must also present an authentic face – Social media INSTANTLY detects propaganda – Infinite choices make consumers impatient – World class service is becoming the expected norm • When marketers join this conversation, major transformation occurs.

The Authentic Consumer Voice • CASE STUDY: Rubbermaid • Customer reviews added to product pages – Looked for one-star and two-star reviews • New antibacterial sink mat – Less stain resistance led to negative feedback – Consumers wanted sink mats to make sinks look better – Rubbermaid fixed problem • Rubbermaid’s response changed customer interaction – Saw company listening and caring – “I am happy that my ‘single voice’ may have made a difference. ” – Big win • Creating brand advocates from initially negative experience

When Social Media Backfires. . .

Not Corporate Propaganda • BP America – well developed set of social media channels – 45, 000 Facebook fans 18, 000 Twitter followers – well-edited copy announcing victories and overemphasized progress. – no conversation, no give and take and no interaction with the community • Fake Twitter account – Satirizing response to spill attracted 37, 000 followers – real Twitter account attracted only about 5, 500

Marketing 3. 0 Resistance is futile. . . Guy Iannuzzi President, Mentus December 3, 2012 guy@mentus. com

The Future

Looking to the Future ? • No one can know. . . what the next big thing in social media will be. • The Internet has become a necessary part of people’s daily lives • Social media is exploding in popularity all over the world.

Paradigm Change • • From a sellers market to a buyers market Transformation of market research The emergence of true transparency Compression of launch windows and strategies

Social Media continues to evolve • Major brands take social programs seriously – Not just retail – Brands ranging from highly-regulated insurance companies to consumer packaged goods to businessto-business brand • Exploring new ways to implement social initiatives • Focusing on finding their authentic voices • Creating infrastructures – That involve full organizations

Mobile First • Mobile devices. . . will overtake and supplant computers. . more interaction on i. Phones and i. Pads than computers. . also by companies and the Web. • IT/service solutions defined by mobile consumption. . . online shopping to effortless, paperless transactions and check-ins. . . watching and creating videos with friends abroad. . . in-class learning and collaboration. . . managing health in real time….

Looking to the Future • Social media provides good practices for facing new challenges – Requires effective marketing efforts and authority-building – Makes all marketing plans utilizing it more effective • What make social media effective, makes you better marketers overall • A social-media strategy should be integral to any complete marketing plan – Service companies must be on cutting edge • Social media is not just a phase – its an integral part of today’s marketing

Looking to the Future • In 2012. . . – More companies go beyond using social channels for building awareness and providing support. – Use social-media engine for strategic decisions and execute objectives, marketing plans, product roadmaps. – Expect a surge of service providers collecting social networks, video, mobile capabilities, cloud services and analytics, with their own unique services and proprietary capabilities.

Marketing 3. 0 Resistance is futile. . . Guy Iannuzzi President, Mentus December 3, 2012 guy@mentus. com