The Future Of Interactive Marketing (And What To Do About It)

Shar VanBoskirkVP and Principal AnalystForrester Research

April 14, 2010

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Firms must accommodate an ever- changing set of marketing rules.

THEME

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Agenda

•What is the current state of interactive marketing?

•What are the greatest challenges the interactive marketer faces today?

•What best practices will help marketers overcome present challenges?

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Interactive marketing will near $55 billion by 2014

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1) Monies are shifting from traditional to interactive

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Email replaces print and direct mail budgets

"Email is so inexpensive we are getting even more use. We are completely skipping the direct mail piece of our

Student Campaign.“-- Sovereign Bank

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2) Marketers try to balance budgets with consumer media time

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3) Empowered consumers expect interactive relationships

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4) Interactive channels will increase in effectiveness

Increasing effectiveness

Decreasingeffectiveness

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Agenda

•What is the current state of interactive marketing?

•What are the greatest challenges the interactive marketer faces today?

•What best practices will help marketers overcome present challenges?

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1 The recession.

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Marketers are functioning with leaner teams than ever

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Most staff fewer than 10 people toward interactive

Source: Q3 2009 Global Interactive Marketing Organization And Agency Survey

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$ $ $$

Media spend

And they are sacrificing branding in order to drive immediate transactions

Consideration BuyersAwareness Preference Purchase LoyaltyEyeballs

66% of online media buys will be performance based by 2014,

up from 58% today

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2 Finding the right audiences.

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Even simple user-generated content like photos

Media proliferation means everything is a place to advertise

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People want content to come to them wherever they are

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3 Figuring out social media.

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• The trend is irreversible• It has changed the balance of power• It creates rapid (and often uncontrollable)

innovation

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This means more than just adopting a new set of marketing tools

• Adidas “New School of Thought” campaign tapped online community

• Feedback on concept, creative, offers, even font size• Germinated new “strike a pose” campaign

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Zappos uses Twitter to give its brand a human face

“The radio’s morning show is

talking about twitter. So now I

am twittering about the radio’s morning show.

The circle of life is complete.”

“I just got challenged to a dance-off by my

friend’s kid. Sadly, I lost.”

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4 Mobile.

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Mobile has a lot of potential

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But the mobile supply chain complicates marketer experimentation

• Brands• Agencies• Publishers

• Mobile marketing enablers

• Operators• Infrastructure providers

Source: Michael Becker, iLoop Mobile, Inc., andThe Mobile Marketing Association

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So right now mobile experiments are “cool,” but hard to value

• Ran mobile banners to drive Superpages iPhone app

• Over 87 million ad impressions served in 7 weeks*

• Resulted in more than 12,000 direct Superpages application downloads

• Superpages reached a ranking of #9 in the Lifestyle app category

So what?

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5 The Splinternet.

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The Internet is entering a new era

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Proprietary standards will define interactive experiences

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Marketing will no longer be as we know it

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Agenda

•What is the current state of interactive marketing?

•What are the greatest challenges the interactive marketer faces today?

•What best practices will help marketers overcome present challenges?

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! Build interactive, not just digital strategies

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1) Reduce the role of channels and channel specialists

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2) Develop your interactive organization

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3) Invest in data and data relationships

Linkage Experian enables a de-

personalized data sharing network, with linkage between disparate datasets created via both personal & non-personal

data variables

Privacy & Compliance

Experian ensures that its client’s compiled personal data is never

shared with any 3rd party and that non-personal linkages are

obtained with requisite notice, transparency & notice from

reputable partners

DataExperian acts as the data agnostic hub, enabling the

marketplace and connecting all relevant, available data to the client’s targeting and analytical

requirements

Trusted 3rd PartyAs the trusted 3rd party, all

participants in the data sharing ecosystem can leverage

Experian technology & expertise to maintain the sanctity of their

sensitive information

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4) Innovate to improve the customer experience

Enhance

Include

EmpathizeIterate

Improve a program already in place

Increase the margin of an existing effort

Incorporate community perspective

Accept and apply continuous feedback

Humanize a brand

Relate to user need

Roll out in phases

Allow for outgoing enhancements

Does the innovation…?

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5) Assume a modular approach to campaign development

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Summary

• Interactive marketing is poised for significant growth

•But changes in media and technology bring challenges as well as opportunity

•Marketers can tackle challenges by creating interactive, not just digital strategies

– Reduce the role of channel in your strategy

– Build out your interactive organization

– Invest in data and data relationships

– Innovate

– Create campaigns modularly

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Shar VanBoskirk

+1 617.613.5845

svanboskirk@forrester.com

www.forrester.com

Thank you