What if there were no more TV? FUTURELAB
Outline speech Bucharest Need kickass opener Advertising is Dead FUTURELAB
Actually…. FUTURELAB
Last Year
Last Year 76% of consumers don’t believe that companies tell the truth in advertisements Yankelowich, 2006
Last Year “You can’t bore people into buying your product – you can only interest them”
The Consumer is Tuning Out • In 1965, 80% of 18 -49 year-olds in the US could be reached with three 60 -second TV spots. In 2002, it required 117 prime-time commercials to do the same. ” (Jim Stengel, Global Marketing Officer, P&G) • A US hour of prime time TV carried 21 minutes of advertising, Late Night network shows like Leno or Letterman carry 31: 27 (TNS Media Intelligence, Q 1 2006) • Big Six study (US): People with DVR’s watch 12% more TV, yet 90% of them adskip (Germany : 88. 2%) • 78. 2% of Germans are irritated by advertising, only 24% actually still watches it (Gf. K Marktforschung) • 85% of Chinese stop watching TV during commercial breaks. More than half change the channel, while the rest do housework, eat, chat or use the bathroom. (Mc. Kinsey & Co. ) FUTURELAB
Last Year “Today's marketing model is broken. We're applying antiquated thinking and work systems to a new world of possibilities. " Jim Stengel, Global Marketing Officer P&G
Last Year Advertising Myths 1. Frequency is mostly not a driver for action 2. There is no golden rule about OTS
Last Year • 54% of US consumers avoids products & services which “overwhelm” with advertising (Yankelovich Partners)
Share of Voice?
Last Year Advertising is a tax you pay for unremarkable thinking Robert Stephens, CEO, the Geek Squad
Total Transparency • With total transparency, how can there be advertising? • Shotcodes in stores in Japan, telling you where to go to get the product cheaper • A fucked company example
Prices aren’t what they used to be
Total Transparency
Lawyers
Lawyers
Doctors
Teachers
Most influential information sources in purchasing electronic goods? (TOP 3) In-store Sales Associate 49 In-store demonstration 36 Word-of-mouth from family & friends Newspaper Coupons 33 Internet 21 Product/Company Information 16 Retailer information 14 Other 14 Magazines Share of total adspend by medium (global) % 2008 forecast (March 2008) % 4 TV 4 Radio 3 25 What are we focusing on? FUTURELAB CMO Council’s Retail Fluency Report, 2005 Source
Now… People who live near train lines find ways to adjust to the noise. . . Consumers have begun to treat encroaching advertising just like those trains.
Banner blindness 1998!
“Online video ads are quickly becoming the medium of choice to drive both brand awareness and sales. ” (2007) “With young adults now spending on average six hours a week gaming, advertisers should be excited at how well their messages were embraced and the brands positively perceived” (2008) 67% of marketers report they will increase their social media advertising budget in 2009
Contextual advertising. . . has just died
• Advertising is dead – long live marketing Lets keep the patient alive a little longer
Procter & Gamble is placing radiofrequency identification tags on products at a Metro Extra retail store in Germany so that when a customer pulls the product off the shelf, a digital screen at eye level changes its message At least be the first!
% of marketers advised by agencies to advertise in games/virtual worlds 62% % asked to start/increase viral marketing spend on social networks 87% % told by agencies to begin/increase viral video spend 93% Marketing Sherpa Ad: tech survey
The Advertising Technique Hype Cycle Isnt there a bit much? Hmm – what’s this? Hey, actually this is cool Naah, cant measure it Sooo 5 minutes ago
Is it all over?
It’s only just begun
FUTURELAB The Attraction Model
Attention Economy Reputation Economy
Relevance!
Relevance Engagement Reputation x Relevance x Engagement = $$$
Reputation Relevance Engagement FUTURELAB The Attraction Model
Reputation Experience Listening Customers
perception 80% of CEO’s believe their brand provides a superior customer experience 8 % of their customers agree (Bain & Company) FUTURELAB
Online Reputation Romania FUTURELAB
The online reputation is just the tip of the iceberg But it can crash your boat Source: Forrester Technographics® - 2008 FUTURELAB
So Listen! Because if you don’t listen. . .
“With regards to the recent Motrin advertisement, we have heard you. On behalf of Mc. Neil Consumer Healthcare and all of us who work on the Motrin Brand, please accept our sincere apology. We have heard your concerns about the ad that was featured on our website. We are parents ourselves and we take feedback from moms very seriously. We are in the process of removing this ad from all media. It will, unfortunately, take a bit of time to remove it from our magazine advertising, as it is on newsstands and in distribution. Thank you for your feedback. It’s very important to us. ” Results 1 - 10 of about 11, 600 from twitter. com for motrin. “hell hath no fury like a mommyblogger scorned”
Reputation Relevance Engagement FUTURELAB The Attraction Model
Relevance Insight Communication Commerce
INSIGHT Understand what truly drives your customers FUTURELAB
• Podcast and map downloaded Commercial – yet relevant
FREE TIX TO GREAT ADVENTURE Heard a rumor you can get 2 free tix to opening day weekend at Great Adventure amusement park 45000 tickets gone in 5 hours
Relevance of Commerce
Downsizing
Reputation Relevance Engagement FUTURELAB The Attraction Model
Engagement Engagment • Funnel • Content • Recommendation Move the funnel Content Recommendation
Funnel AWARENESS NEED TRIAL CONSIDERATION REPURCHASE UPGRADE LOYALTY BRAND EXIT RECOMMEND (c) 2007 -2008, Futurelab – Used with Permission IGNORANCE
Buzzmarketing
Content wants to be free
How to control millions of inaccurate and divergent conversations ? YOU DON’T Consumers are beginning in a very real sense to own our brands and participate in their creation … We need to begin to learn to let go. A. G. Lafley, CEO and Chairman of P&G, October 2006 (cc) Lynette Webb, 2006
‘Help us choose’
Let them improve your products
Let them build their own
The Power of Recommendation
The Power of Recommendation 1955 1967 1983 2001 2007 Word-of-mouth is 7 x more effective than newspaper advertising, 5 x stronger than a personal sales pitch and 2 x as effective as radio advertising Marketing Science Institute, 2006 This is not exactly news. .
How can we measure all this
HOW LIKELY ARE YOU TO RECOMMEND? Extremely unlikely 0 Extremely likely 1 2 3 4 5 6 DETRACTORS 7 8 PASSIVES 9 10 PROMOTERS NPS™= (Promoters-Detractors)/Total Net Promoter Score ™ is a registered trademark of Bain & Company, Satmetrix and Fred Reichheld The Power of Recommendation
Promoters make you more money -They spend more -They negotiate less -They stay longer -They are easier to service -They upgrade quicker -. . . Slide: Bain & Company, official NPS(tm) presentation Fred Reichheld. Net Promoter Score ™ is a registered trademark of Bain & Company, Satmetrix and Fred Reichheld The Power of Recommendation
Activate your Fans
Must See
• Traditional compensation & other systems stand in the way • Creative and media work in isolation • Lack of experience with new media (not everyone went “dot-com”) • Venturing into uncharted territory = risky (even on a personal level) • Nobody really knows how things will evolve
GO DO IT
The Element of Surprise
