Razorfish outlook report 2011 (vol10)

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Transcript of Razorfish outlook report 2011 (vol10)

Page 1: Razorfish outlook report 2011 (vol10)

outlook reportVOL 10

Page 2: Razorfish outlook report 2011 (vol10)
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3OUTLOOK REPORT | VOL 10

Outlook Report, Volume 10 — There’s no better time to start something.

The Year in Media Forget Mobile — Think Multiscreen

A Wake-Up Call for Collaboration

It’s Time for Big Data to Improve Customer Experience

Humanity Check — What Consumers Really Think About Tech

How the Social Cloud Can Accelerate Brand Interaction

Beyond the Banner — Unleashing the Power of Digital to Drive Topline Growth

The Rules of Gamification

It’s Not Enough to Be Liked — Getting Serious About Social

Controlling the Retail Environment Through Digital Brand Immersion

Performance Marketing Must Die

Toward a New Global Digital Agency Structure

Limited Time to Prepare for Unlimited Potential of Mobile

How the Open API Movement Can Help Your Brand

Organizing for Digital Success

Authors and Contributors

Contact

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GO TO RAZORFISHOUTLOOK.RAZORFISH.COM FOR AN INTERACTIVE VERSION OF OUTLOOK REPORT, VOL 10.

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There’s no better time to start something.

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In today’s world, social tools that started as communications

and marketing tools have become conduits for revolution.

Cloud-based services have finally emerged as viable methods

for increasing collaboration and driving greater efficiency.

And the investment world increasingly looks to start-ups

to once again push the global economy forward.

This means digital is now a lot bigger than agencies. In fact,

it’s bigger than marketing. It’s increasingly woven into the fabric

of our business and consumer culture. This inspires us more

than ever not only to optimize the status quo, but also to ignite

a business movement of sorts.

But how?

First, there is more pressure on our business to perform

creatively, stemming from the fact that digital ideas come

from more sources than just the agency. Indeed, as the new

generation of creators enters the workforce, we have observed

their natural tendency to put digital at the center of their process

and thinking, regardless of their chosen industry or employer.

As a result, companies like ours have to raise their game

creatively to deliver idea-led value to our clients, while creating

an environment for new ideas to thrive.

Next, there is a strong drive to leverage the power of technology

to increase efficiency and drive down the cost of marketing

and doing business. We are seeing tremendous opportunities

in the media marketplace, with the rise of ad exchanges, analytics

and marketing platforms, to do just that. We’re merely scratching

the surface of what’s possible.

Finally, efficiency alone won’t move business forward forever.

When I meet with CMOs, CIOs and CEOs around the world,

I continue to hear a call for innovation and see an ever-present

search for sources of incremental revenue. Marketers and

business leaders once tasked with spending budgets efficiently

are increasingly challenged with identifying new sources of growth,

as well as product enhancements.

The truth is, building an agency that fires on all cylinders — high

levels of creativity, innovation, efficiency and technology — is a

tremendous challenge. But it’s what agencies and great marketing

organizations will need to do to survive in the face of change.

Which brings me back to the Razorfish Outlook Report. I think

you’ll find it to be a little less theoretical and a bit more practical

than in years past. Why? Aren’t digital agencies supposed to be

the predictors of the digital future? There’s nothing wrong

with dreaming big, but first and foremost, in our view the next

12 months will be about doing.

We’re not just talking about the social media explosion, but

also scaling an organization and agency partners to execute

on a strategy. Not simply checking the boxes of media best

practices, but leveraging every tool available to plan, buy

and measure its effectiveness. Not just accepting the product

experience as it exists today, but using technology to improve

customer experience. Not just ideation, but also execution.

As we publish the Outlook Report, we hope it will inspire you

to think and act. It’s what we mean when we say Ignite.

As we gathered the data and spoke to clients and industry watchers to put together the Razorfish Outlook Report, we once again found our business in the middle of tremendous global change. The conversation around digital marketing — long the domain of digital agencies and technology companies — is now part of a much broader conversation about social and cultural change, the global economy and business landscape.

Bob Lord Global CEO

@RWLORD

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7OUTLOOK REPORT | VOL 10

The Year in MediaHere’s our annual look at Razorfish ad spend, along with the results of our media team poll to identify the “Best of the Web” and trends for 2012. As we’ve done in the past, we polled the Razorfish media team to discover the “Best of the Web,” asking a variety of different questions to get a directional perspective of upcoming trends. The questions revolved around creativity, performance, quality and overall general satisfaction.

The past year in digital media was heavily influenced by the rapid adoption of new

channels like tablets, the explosive growth of new consumer platforms like Twitter

and new innovations in media buying such as ad exchanges. Overall, investments

in digital continue to grow year-over-year, playing an increasingly critical role in

our clients’ marketing plans. Consumer migration to digital media, the emergence

of new media powers and the sophistication of performance metrics made the

year in media one of the most dynamic in decades.

Ad spend in review

Razorfish ad spend is projected to grow by more than 25 percent in 2011, marking

the third consecutive year of more than 20 percent growth in overall ad spend for

the agency. The growth is a result of success in new business and from increased

investment from long-standing clients. After just two years, Publicis Groupe has

proven to be a great fit for Razorfish and our clients.

Now more than ever, the function of media planning is about understanding consumer

behaviors and needs — and how to craft experiences that deliver on the opportunities

The Razorfish Media Team

Thomas Sudassy Media Research

and Publisher Relations

LINKEDIN.COM/IN/SUDASSY

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Page 8: Razorfish outlook report 2011 (vol10)

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presented by those evolving behaviors. This is fundamentally

different than simply accumulating reach and exposure through

mass media. Our paid media spend was distributed across five

main channels, illustrating the increasing complexity faced by

clients and digital marketing teams.

A closer look at the distribution of ad spend reveals several

emerging trends:

1. GROWTH IN AD EXCHANGES

Razorfish has been active in buying through ad exchanges

since the early days of auction-based display media. We were

one of the first agencies to launch a trading desk to directly

access the growing pool of inventory and have continued

to be at the forefront of data integration through the creation

of client-side data mart solutions, now commonly referred

to as DMPs.

THE YEAR IN MEDIA

SEARCH

DISPLAY

MOBILE

SOCIAL

NETWORKS/EXCHANGES

43%

36%

4%

4%

43%

13% 36%

4%4%

Spend

Content is media.

0

50

100

150

200

Yearly media billings

IND

EX

2008

2009

2010

2011(e)

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9OUTLOOK REPORT | VOL 10

TAIL

BODY

STRATEGIC0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

TOTAL SPEND

NUMBER OF PUBLISHERS

2007

1,832

2008

1,024

2009

692

2010

598

Number of publishers vs. number of media partnersOur continued expansion into the auction-based media

marketplace has resulted in tremendous benefits for our clients

in terms of more effective pricing, better targeting and stronger

ROI overall. As we continue to grow and expand our efforts in

this area, we will be focused on integrating first- and third-party

data to build the most sophisticated targeting offering possible.

These efforts will, of course, be balanced by the industry’s

important and ongoing efforts to provide sound self-regulation

around data management and privacy.

Our investment in ad exchanges grew by 66 percent in 2010

and is projected to grow again by more than 60 percent

in 2011. Even with that growth, there is still plenty of upside

in this category since it represents less than 10 percent of our

total ad spend.

2. CONSOLIDATION OF PUBLISHER PARTNERS

The emergence of new technologies and consumer channels

continues to provide opportunities for the emergence of new

publisher partners. In 2010, we purchased media across 598

sites, down from a high of 1,832 in 2007. While we expect

many of those buys to be consolidated through the growth

of audience buying across ad exchanges, we still see the

need to test new platforms and technologies.

However, we have continued to increase our concentration

on fewer and more strategic partners. This focus on more

complex, strategic partnerships has resulted in strong benefits

for our clients in terms of scale, price, innovation and access.

The breakout of our spend shows that 55 percent of our

aggregated budget goes to our top five strategic partners,

25 percent to the next 32 largest partners and the remaining

20 percent in our long tail of 584 publisher partners.

0

50

100

150

200

250

300

= TOTAL SPEND

2009

2010

2011

Total spend in ad exchanges

Spend breakout

IND

EX

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10

3. INCREASED INVESTMENT IN PAID SOCIAL MEDIA

The rapid rise of social media has impacted digital and our

clients’ business in many ways. As social media platforms

continued their explosive growth in the last year to reach

massive scale, leading marketers adjusted their plans

accordingly to begin a two-way dialogue with current and

potential customers.

This has led to the emergence of Facebook as a leading

partner in paid media for Razorfish in the last year. Since our

early tests and inclusion in Facebook media programs in 2008,

the social network has gone from being in the lower tier of our

top 200 publisher partners to catapulting to one of our top five

media partners (as measured by total spend). The growth can

mostly be attributed to the fact that Facebook has innovated

in terms of media offerings and that these new opportunities

are helping our clients meet their marketing goals. Facebook’s

growing audience makes it a platform that our clients need

to include in the development of their marketing plans. Our

projections for 2011 point to continued growth and show no

evidence that the rise of paid media on Facebook will slow down.

4. SHIFT FROM PAID TO EARNED AND OWNED

The scale of leading social media platforms such as Facebook,

Twitter and YouTube had a strong influence on the overall

marketing mix for our clients. However, the overall amount

of dollars invested against social media still pales in comparison

to search and display. The advertising models of these emerging

media titans are still evolving, but they will undoubtedly garner

a growing share of marketing dollars.

In addition, the investment in social media management on

third-party and owned platforms is not to be overlooked. The

vast majority of our clients now have earned and owned media

strategies to complement their paid media strategies. Over the

last year we’ve seen tighter coordination between the paid,

earned and owned channels. We now manage relationships with

close to 10 million fans and followers on behalf of our clients, not

including audiences on Web sites and microsites that we manage.

That’s roughly nine times what we managed just a year ago.

Our research into social media analytics has given us great

insight into the impact and the amplification effect of earned

and owned media. As we continue to refine our practices, we

fully expect that investments in content and relationships will

continue to grow rapidly.

THE YEAR IN MEDIA

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5. ACCELERATING GROWTH IN MOBILE

Our mobile media and search business nearly doubled last year

and represented close to 10 percent of our total paid media

business. The major factors that affected this accelerating

investment represent trends that will continue to make mobile

one of the fastest growing categories:

INCREASE IN MOBILE TRANSACTIONS. Our clients are investing

in fully functional mobile experiences where consumers can start

to transact and purchase in the mobile channel. While mobile

commerce is still small and nascent, mobile is becoming an

important touch point in the consumer experience. As marketers

increase the quality and quantity of mobile experiences, the

mobile media and search spends will follow. For example, one

of our clients is seeing pay-per-call increasingly drive significant

scale and ROI.

GROWTH OF TABLETS. The proliferation of tablets in the marketplace

is creating an entirely new channel. As consumers increase their

consumption of media on tablet devices, it will provide a scaled

medium for advertisers to reach their audience. Innovations in

tablet computing will lead to advertising opportunities that differ

significantly from those on PCs or phones. The ability to bring

touch interactivity together with sound, sight and motion will enable

marketers to provide new, rich experiences to their customers.

ALWAYS-ON PHONES. Multitasking with mobile while watching

TV is driving higher consumption of mobile media and providing

new opportunities for marketers to engage with their audience.

Razorfish conducted a study in collaboration with Yahoo! to

understand consumer behaviors and marketing opportunities

across multiple screens. One of the conclusions from our research

is that mobile is emerging as an indispensable activation vehicle

for the massive investments in TV advertising. The complete

details of the study are covered later in the Outlook Report.

“Best of the Web” — A planner’s perspective

As we’ve done in the past, we polled the Razorfish media

team to discover the “Best of the Web.” We asked a variety of

different questions to get a directional perspective of upcoming

trends. The questions revolved around creativity, performance,

quality and overall general satisfaction.

Some of the “Best of the Web” results are listed in the

graphic above.

MOST INNOVATION IN MEDIA OPPORTUNITIES

PREFERRED MOBILE PARTNER

BEST COLLABORATION

PREFERRED VIDEO PARTNER

PARTNER WHERE WE MOST WANT TO SPEND

MONEY, BUT CAN’T FIGURE OUT HOW

MOST CONSISTENT PERFORMANCE

(ADVERTISING.COM)

“Best of the Web”

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12

Razorfish ad spend is projected to grow by more than 25% in 2011, marking the fourth straight year of 20%+ growth

in overall ad spend for our agency.

Themes that will shape the next year in media

There is no doubt that digital media continues to be the most

dynamic and innovative sector in marketing. One of the byproducts

of the rapid pace of change in digital media consumption is the

constant struggle for the industry to evolve traditional delivery

models. Over the next 12 months, agencies must focus on

adapting to the proliferation of new consumer behaviors and

new marketing tactics. In particular, next year will be dominated

by challenges such as how to manage video across multiple

screens, how to rapidly incorporate changes in social media,

how to plan in a cross-platform landscape and how to scale

mobile advertising.

While those trends will certainly dominate the conversation

around media and marketing, it’s our perspective that there

are also four major themes that will work to reshape digital

media in the next year.

1. CONTENT AS MEDIA

Most marketing professionals admit to having been in a vigorous

debate sometime in the last year about the classification of a

particular tactic as paid, earned or owned media. The construct

is very useful in helping marketers broaden thinking around

marketing strategies. But perhaps the real value is in helping

reinforce the notion that content is media. And content can exist

in many forms. The notion that agency planners are responsible

for content leads to strategies and plans that can have a much

greater impact. In the next year, progressive marketers will

be the ones that begin to integrate all their brand assets into

a single communication platform, creating a unified brand

experience that puts the needs of the consumer at the center.

2. DATA MANAGEMENT

In the last five years, we’ve increased the amount of data that

we manage in our own servers from 3 terabytes to 90 terabytes.

The ability to manage large and complex data sets has shifted

from being a core differentiator to an absolute requirement.

Data sources are more vast and complicated than ever.

Building a single view of the consumer across all channels is

the only way that marketers can truly build effective marketing

programs. More than 80 percent of our media clients rely on

a data management platform that we have custom built to make

their digital marketing more targeted and more effective. Over

the next year, these platforms will continue to become more

THE YEAR IN MEDIA

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13OUTLOOK REPORT | VOL 10

sophisticated, taking into account an increasing number of data

sources. Data management pays off for marketers — we’ve

been able to improve return on ad spend more than five times

by serving personalized ads to dynamic segments enabled

by a unified marketing database.

3. REAL-TIME BUYING

In the last year, we have more than tripled the number of real-

time impressions we’ve purchased. On average, we’ve seen

performance improvements of more than 40 percent for our

clients. The real-time nature of digital data has simply changed

the way we buy media. Those who are able to understand data

and act upon it immediately — in real time — have a strategic

advantage over their competitors. Long gone are the days

when companies and their agencies could buy media months

in advance, then wait several more months to understand

how those media investments performed. Today, agencies

and brands have seconds in which they must respond, or

potentially leave millions on the table in lost value. Brands need

partners who can collect, translate and take action on that data

in real time. Agencies that are well-versed in bid-management

systems, and that invest in the tools and processes to manage

those systems, will become industry leaders. The real-time

and highly complex nature of digitized media allows marketers

to develop a sustainable competitive advantage.

4. ATTRIBUTION

For the last decade, we’ve been building attribution models

for our clients to help them invest their marketing spend

more effectively. In the pioneering days, this type of analysis

was done infrequently and was limited in breadth and scope.

Today, with the data and processing infrastructure we have

invested in over the last 10 years, and the growth of the

marketing analytics group to more than 100 professionals,

we are actively building these kinds of models for our clients

on a regular basis. In fact, we’ve seen return on ad spending

improve by as much as 3.5 times through smarter allocation

of media investments. While it’s a discipline that demands

constant iteration and analysis, that type of improvement

makes attribution modeling a crucial strategy for marketers.

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15OUTLOOK REPORT | VOL 10

Forget Mobile — Think MultiscreenAs is the case with many new technologies, consumers are moving faster than brands. They’re already using smartphones and tablet devices in front of the TV to communicate with friends and family, look up information related to the show they are watching, or else surf content that is completely unrelated to what’s on the big screen. Razorfish partnered with Yahoo! to conduct a study to better understand this rapidly evolving consumer behavior and to provide guidance for how marketers should approach the corresponding opportunity.

Mobile devices are used frequently in conjunction with other screens, including

the big TV in your living room. Anyone who has ever tapped out an email on their

iPhone, while checking a score on the VAIO balanced on their lap, while keeping

an eye on American Idol on their 40-inch BRAVIA knows this. Yet many marketers

today are ignoring this ubiquitous consumer behavior as they over-focus on mobile

as a stand-alone medium.

Media multitasking is not a new thing, of course. People have used laptops in front

of the TV since… well, probably since the first laptop entered someone’s home.

We’ve seen data on this behavior for years, and yet, beyond putting a URL on

screen or asking people to “like” a brand on Facebook, most TV spots don’t

acknowledge or attempt to capitalize on the fact that the consumer is watching

with a Web-enabled device on their lap or in their pocket.

At a minimum, multitasking adds another layer of complexity to the evolution of

media measurement. At most, it’s a massive disrupter to television, the medium

that receives the most ad spending. DVRs threw the industry for a loop, and

Jeremy Lockhorn VP, Emerging Media

@NEWMEDIAGEEK

WITH CONTRIBUTOR

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16

C3 ratings were born to begin to address a world where the

consumer is increasingly in control.1 Now, add mobile and tablet

multitasking to the mix and marketers everywhere wrestle with

measuring the latest evolution in consumer TV viewing behavior.

On one hand, there is a potential distraction factor with

connected devices, and on the other, there is a much more

engaged viewer who is passionately chasing down more content

on devices beyond the TV. How do marketers account for that

with Gross Rating Points (GRPs) and Target Rating Points (TRPs)?

We don’t yet have a clear answer — give us six months —

but most marketers seem to be ignoring the question and

failing to capitalize on the corresponding opportunity created

by mobile multitasking.

Which leads us to this: Lots of data has been published about

the fact that consumers are using mobile and tablet devices

while watching TV, but little of it has gone deep enough to be

really useful in planning a multi-screen strategy. So Razorfish

partnered with Yahoo! to conduct a survey among Web-enabled

phone owners with the goal of better understanding this rapidly

evolving consumer behavior and providing some guidance

for how marketers should approach them.

We found that a stunning 80 percent of respondents are mobile

multitasking while watching TV. Below are some highlights and

key implications for marketers.

MOBILE MULTITASKING IS ADDICTIVE. 70 percent of respondents

who multitask do so at least once a week, with nearly half (49

percent) reporting everyday multitasking. Furthermore, during

the course of a TV program, more than 60 percent check their

phones at least “once or twice,” and 15 percent stay on the

mobile Web for the full duration of the show.

MULTITASKING IS BOTH AN ENHANCEMENT AND A DISTRACTION.

An equal percentage of multitasking respondents (38 percent)

agreed or strongly agreed with these statements:

of respondents are mobile multitasking while watching TV.

FORGET MOBILE — THINK MULTISCREEN

1 “C3” TV Ratings Show Impact of DVR Ad Viewing,” blog.nielsen.com, October 14, 2009, http://blog.nielsen.com/nielsenwire/media_entertainment/c3-tv-ratings-show-impact-of-dvr-ad-viewing/.

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17OUTLOOK REPORT | VOL 10

Using the Internet on my mobile or tablet device while

watching TV enhances my viewing experience.

I find using mobile devices while watching TV

to be distracting.

This seems to be an opportunity for content producers and

advertisers alike. Some people find multitasking to be a boon,

and we have only begun to scratch the surface in terms

of providing an engaging dual-screen experience. It’s like the

early days of smartphones where it was remarkable that people

were making purchases from sites that were not mobile-optimized.

If folks were willing to go through that much effort, it stands to

reason that making the experience easier and more streamlined

will lead to even more passionate participants.

CERTAIN PROGRAMMING GENRES LEND THEMSELVES TO

MULTITASKING. The top five categories that attract

multitaskers are:

so high and social networking so low; we expected the reverse.

On the content side of things, 60 percent of multitaskers

are accessing additional content of some type. 44 percent

is unrelated to what’s on TV versus only 38 percent related to TV.

Clearly there can be a distraction factor here when it comes to

TV commercial time, but the good news for marketers is that 36

percent of multitaskers use their connected devices for looking

up information on a commercial they just saw.

TV AD TIME = MOBILE PRIME TIME. TV ad breaks are triggers for

multitasking because phones and tablets are, not surprisingly,

more likely to get fired up and accessed during regular

commercial pods. And, our survey respondents were more likely

to state that they frequently engaged in multitasking during

ad breaks. What people do during this time doesn’t change all

that much. It’s still communication first and content second.

An analysis of mobile Web traffic to the Yahoo! homepage

during this year’s Academy Awards broadcast indicated clear

spikes in traffic during TV ad breaks.

CONNECTED DEVICES ADD FUEL TO THE FIRE OF SPORTS FANDOM.

Almost half of respondents reported multitasking during sporting

events, with little difference shown between live or pre-recorded.

In fact, even when attending a live sporting event in person,

more than a third can’t stay away from their devices. Another

key difference between sports and other genres is that with

sports, people are driven more by content than by communication

(recall it was the other way around overall). Texting still rules, but

after that, other communication styles drop off — and various

content rises to the top. Leading behaviors include checking

scores and schedules of other games, and looking up team

and player information or statistics. Smack talking showed up

surprisingly low (20 percent) — maybe that’s because it’s not

as rewarding when you can’t see the look on the other guy’s

face — this feels like an opportunity for an inventive developer

(or enterprising marketer).

Again, an analysis of Yahoo! mobile traffic confirmed that with

sports content (in this case, World Cup 2010 and Super Bowl

2011), commercial breaks spark mobile usage. Even bigger

spikes are seen at halftime and after the games. For example,

during the Super Bowl halftime show, Yahoo! Sports saw a 305

1. Reality 2. News 3. Comedy 4. Sports 5. Food

While the top results may not seem surprising, what struck us

about the results further down the list were that drama edged

out genres like talk shows, music videos, how-to and others.

We thought drama and action/adventure shows would be less

likely to see multitasking behavior. Perhaps these intense

programs stoke multitasking as viewers get hooked and seek

ways to further immerse themselves in the show’s world. Think

about Breaking Bad, CSI, Dexter or True Blood — those shows

are intense but they also beg viewers to dig a few levels deeper

than what happens during those weekly 40-plus minutes.

COMMUNICATION AND CONTENT ARE THE MAIN DRIVERS FOR

MULTITASKING. 94 percent of multitaskers engage in some kind

of mobile communication. In order — text, talking, email, social

networking and IM. It’s somewhat surprising to see talking

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18

happening in the TV spots, and perhaps even what’s happening

in the current program — especially if it’s live. At a bare minimum,

it’s time to consider what kind of mobile call to action may be

appropriate in the brand’s TV spot.

Pepsi, Old Navy and Heineken have begun experimenting here.

Pepsi gave away a free bottle of Pepsi Max to users who tagged

the commercial using IntoNow, a Yahoo! social tool that allows

you to share what you’re watching with your friends. Old Navy’s

“Old Navy Records” campaign encourages users to tag spots

with Shazam to unlock related content like the featured looks,

and even download the music tracks for free. Heineken’s Star

Player app gives users the chance to play along with soccer

matches by attempting to predict which team will score within

the next 30 seconds. These efforts begin to show the possibilities,

but are only scratching the surface.

MOBILE SEARCH IS ABOUT MORE THAN LOCAL. There’s no doubt that

local search is very important. After all, mobile users are accessing

local search 34 percent more than they were a year ago, according

to research from comScore and the Local Search Association.

But, with the massive amount of multitasking behavior highlighted

here combined with the various studies suggesting that anywhere

from 30-40 percent of mobile data usage happens at home, mobile

percent increase in mobile traffic. After the game, even more

users flooded the sports section, pushing overall increase up

387 percent. And, not surprisingly, Yahoo! saw massive spikes

in mobile search traffic related to TV spots, including several

movies and automobile manufacturers.

Implications for marketers

YOUR TV CONTENT STRATEGY MUST EVOLVE (AGAIN). It used to

be relatively easy. Crank out a few 30-second spots and call

it a day. But then came the Web, video on demand, basic

interactive TV capabilities and so forth. Most marketers are

still struggling to figure out how to truly capitalize on the

opportunities represented by long-form video and — more

recently — social content. Now, a new imperative is clear,

especially for those spending heavily on TV. Content and

experiences that move seamlessly from one screen to another

are an absolute must. This is bigger than simply having

a mobile- or tablet-optimized Web site. It means a cohesive

communications strategy where the spots and the experience

on mobile devices work together and build toward a greater

whole. It means a mobile-optimized site that knows what’s

Content and experiences that move seamlessly

from one screen to another are an absolute must.

FORGET MOBILE — THINK MULTISCREEN

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19OUTLOOK REPORT | VOL 10

search isn’t exclusively about finding the closest taco joint.

Marketers must reconsider their search strategies. At a minimum,

they need to ensure that their mobile properties are properly

positioned in organic results. It may also be worth re-evaluating

the keywords they’re bidding on, perhaps to include terms that

link the brand to shows and events they’re sponsoring.

Let’s take an automotive company launching a new luxury sports

sedan, for example. Part of the launch is sponsorship of a live

awards show — several spots appear throughout the show and

the celebs hitting the red carpet arrive in the new vehicle.

Bumpers include “sponsored by” mentions and on-screen

logos. The spot closes with a URL. Some viewers might jump

to their phones, fire up the browser and enter the URL.

But a good portion of them will also take what they perceive

to be a shortcut: typing the brand’s name into a search box.

Organic and paid results should appear and direct a relevant

experience — perhaps the site’s homepage temporarily features

the new model as well as content related to the awards

program. Perhaps the red carpet reporter films a walk-through

of the vehicle, and that video is made available. To drive even

more traffic and engagement, the brand could bid on search terms

relevant to the awards show (and popular gossip sites). The call

to action could be something along the lines of “See your favorite

celebs arriving in the new XYZ car,” linking through to a series

of videos and also featuring the red carpet reporter’s overview.

CONNECTED DEVICES ARE THE NEW WATER COOLER. People aren’t

waiting until the next day to discuss what happened on their

favorite program anymore — it’s happening in real time now,

via text, email and social networking sites/services. Brands can

ride along here as well, but it requires a smart social strategy

that syncs the brand with the programs they’re sponsoring.

It’s not easy, but with more than half of multitaskers getting

active on social networks during TV viewing, there is a massive

opportunity to engage the audience on a new platform.

In the automotive example above, there are several ways

the brand might get involved in the real-time discussion.

Aggregating Twitter feeds on their homepage, for example, allows

users to explore the new sedan while staying connected. Perhaps

sponsored tweets could go out from a few celebs talking about

how much they liked the ride in the car. The brand’s social network

presences could all be talking about the show, perhaps launching

real-time polls asking users to predict who will win the next

category. And so on.

Page 20: Razorfish outlook report 2011 (vol10)

20

MULTITASKING MIGHT FINALLY KILL (OR AT LEAST REINVENT)

THE GRP. The GRP debate rages on. The metric that has been

the currency of the offline world for decades has tried time

and time again to enter the digital world, only to be beaten back

by legitimate arguments that it doesn’t accurately account for

different levels of engagement, among other weaknesses.

But here’s the remarkable thing about multitasking —

increasingly, the devices are going to know what people are

watching, providing a potentially more accurate view into what

large groups of people are tuning into. And, with so much

brand engagement happening on these connected devices,

effectiveness of spots may also be more accurately measured.

Lastly — and this is the silver bullet — with massive growth

expected in mobile payments and mobile wallets, the same

device that knows what people are watching and what people

are surfing will soon know what they’re buying, creating

the ideal closed loop for ROI-driven marketers. And who

isn’t ROI-driven these days?

Connected devices are the new water cooler.

FORGET MOBILE — THINK MULTISCREEN

Page 21: Razorfish outlook report 2011 (vol10)

21OUTLOOK REPORT | VOL 10

By Frederic Bonn

Do you want aconsistent

communicationplatform that

works across allchannels and isrelevant to the

consumerbehavior in

each?

Do you rely on more than one agencyto handle your communications and

marketing?

Andyou re

satisfiedwith that?

Areyou indenial

?

So you’dactually

rather workwith multiple

agencies?

Do you have one lead agency creating ideas while the others simply follow?

Here's a little more about how agencies think.

They all love what they do, but their love is blind.

Agency A thinks that Agency B is clueless about digital, even though Agency B said they had videos on YouTube — “That’s digital, right?”

B dismisses A’s ideas because A doesn’t know anything about the

brand, but come on, A had a video on YouTube, too! — “That’s brand

building, right?!”

A and B think C should just follow what they say — “Wait, you didn’t

get our memo?”

And D should just buy what they all need — “Because we’ve

already figured it out.”

Your lead agency is probably the “traditional” agency, right? Great, you now have a 30 second spot (or 60) and some print ads.

Do you believe consumers only experience your brand via one

media channel?

And they provideground-breaking

creative ideasthat deliver great

results?

Did you develop an integrated brief thatincorporates all agencies, teams and disciplines involved in your business?

Have you defined your individual agencies’ roles and responsibilities?

And they never try to compete anyway?

Do your teams meet regularlyto develop an integrated brand

strategy and campaigns?

Do you know how mostagencies operate?

Is that single agency capable of masteringintegrated communications from social

media to mobile, event planning to mediabuying, TV to digital?

And you have operational flexibility and scale?

Do you want your agenciesto successfully collaborate?

Page 22: Razorfish outlook report 2011 (vol10)
Page 23: Razorfish outlook report 2011 (vol10)

23OUTLOOK REPORT | VOL 10

A Wake-­Up Call for CollaborationThe ability to integrate creative, media and technology to meet the demands of your always-­on consumer is ideal. However, most traditional lead agencies don’t have those capabilities just yet, nor are most digital agencies prepared to handle lead agency duties. Coordination of your agencies is not enough — you need to move more aggressively toward true collaboration. We’ve identified five big barriers to essential agency collaboration.

People now consume 12 hours of media in just 9 hours of elapsed time, according

to a recent Harvard Business Review study.1 Consumers use a lot of media types

all at once and now brands need to catch up. To do so, marketers must change

how they work with their agencies.

If you are a CMO or a brand leader, you are probably using multiple agencies

to meet the demands of your always-on consumer. A lead agency that can integrate

creativity, media and technology would be a great solution, but traditional lead

agencies aren’t yet capable. In 2009, Forrester Research set off a mini industry

tempest when it reported that only 23 percent of interactive marketers felt

traditional agencies were equipped to handle interactive marketing work.2 Fast

forward two years and Forrester still reports that only 30 percent of those surveyed

use their traditional agencies for digital marketing, and in fact 68 percent of those

marketers work with two or more agencies. Some reportedly have more than 15

Pete Stein President, East

@PSTEIN211

Frederic Bonn Executive Creative Director

@FREDERICBONN

1 “How Internet Junkies will Save Television,” Harvard Business Review, http://hbr.org/web/extras/ how-internet-junkies-will-save-television/4-slide.

2 Sean Corocan, “The State of Interactive Agencies,” Forrester, December 7, 2009.

WITH CONTRIBUTOR

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Page 24: Razorfish outlook report 2011 (vol10)

24

agencies on their interactive rosters.3 By the same token, most

digital agencies aren’t yet ready to handle lead agency duties. In

three to five years, the landscape will look different, but for now

marketers have to deal with a patchwork of agencies that are

channel specialists and all the complexity that comes from that.

What can you do now to drive the integration of creativity,

media and technology that you need to truly engage consumers?

Coordination of agencies is not enough — you need to move

more aggressively toward collaboration. And guess what?

Agency folk want more collaboration — or at least they claim

they do.

So, what are you waiting for? If you are a CMO or brand leader

and you’re not pushing your agencies for deep collaboration,

you’re missing out on a big opportunity.

We have seen five big barriers to collaboration:

1. CLIENT EXPERIENCE/CONFIDENCE

As a brand marketer, you probably have more confidence

in one area of the marketing mix or the other. Perhaps you are

a digital native who lives and breathes ones and zeroes, and now

you’ve been promoted to look after the whole mix. Or maybe

you’re a “traditional” marketer with a strong legacy of brand

building, but you’ve had your run with TV commercials.

You find digital exciting, but daunting and maybe even a bit

over-hyped. Wouldn’t life be better if your agencies were

bringing truly integrated ideas to you?

2. CULTURAL INERTIA

Success can dull the competitive edge. We have seen many

marketers and their agency teams not adapt fast enough because

they haven’t had to. Sometimes a great track record can put you

A WAKE-UP CALL FOR COLLABORATION

3 Sean Corocan, “How to Optimize your Interactive Agency Roster,” Forrester, May 27, 2011.

Coordination of agencies is not enough — you need to move more aggressively toward collaboration.

Page 25: Razorfish outlook report 2011 (vol10)

25OUTLOOK REPORT | VOL 10

in a position for future failure. Similarly, agencies, particularly

account people, are protective of their turf. Unless they feel

their piece of the pie is protected, change will be difficult.

3. ABOVE-THE-LINE AGENCY SNOBBERY

Some above-the-line agency teams believe that: 1) digital agencies

don’t have anything of value to contribute to the conversation,

or that 2) their team is already leading the way in digital.

4. DIGITAL AGENCY LIVES IN A DIGITAL BUBBLE

Digital agency teams tend to fall down in two places: 1) they

don’t fully respect the power of offline communications, or

2) they aren’t able to lift out of the tactical and into the strategic,

and they fail to put their work in this broader strategic context.

This leads clients and above-the-line agencies to keep them

in their digital silo.

5. CLIENT SILOS

Clients are often organized into silos that make it very difficult

to plan with a focus on how the consumer and the brand should

engage. There are different client owners for traditional creative,

digital creative, media, PR and other elements of the mix, too.

When agencies report into different silos, true collaboration will

not occur.

Despite these barriers, we have had success with our clients

and our agency partners. We recently formalized our partnership

with BBH at Unilever, a client with whom we’ve had a lot

of success rethinking the model. Here are some lessons we’ve

learned on getting the best work out of the right people:

ESTABLISH THE PROCESS. In order to get the most out of each

agency, make sure you define a clear process for them to work

together. You need to clarify the boundaries of their engagement,

expectations and ownership. One exercise we went through

with a partner agency was to play the “what if” game. We talked

through all of the worst-case scenarios we could imagine

and how we would handle them when things went wrong.

It was a fun game and a great way to talk through problems

in an environment where emotions weren’t running high. While

you’re at it, examine your own organization. Agencies tend

to organize around their clients, so if your organization is siloed,

it’s likely that your agencies will be, too. Even if you don’t

change your structure, make sure your organization is aligned

and not operating in silos defined by channel.

DEMAND CREATIVE AND MEDIA COLLABORATION. Creative

collaboration starts with a solid brief delivered to all agencies

simultaneously. Unearthing an insight that reflects true audience

behaviors is critical to crafting a relevant message, no matter

who makes it or when it’s launched. The brief needs to nail the

business objectives, brand DNA and the digital behaviors —

with the goal of tapping into the rituals that are ripe territory for

the brand. We recently found that if we allow the above-the-line

agency to own the brand DNA, we can own the digital behaviors,

thereby making sure they are embedded into the ideas. This will

enable your creative teams to come back with a true creative

platform — not just a single execution that’s stretched across

channels. One-hit television campaigns or social campaigns do

not a platform make. Don’t settle for anything less than a robust

creative platform. Huge bonus points if your media agency is

part of the team. A successful channel plan is one that considers

how to leverage each channel in a way that makes the whole

greater than the parts. You’ll find that when media and creative

teams work together, you’ll get deeper consumer engagement.

And just to be certain that the ideas are inherently social and

engaging, we have found it beneficial to include explanations

in the brief. Use the brief to articulate why the insights point

toward engagement.

PROTECT COMPENSATION AND PROVIDE INCENTIVES THAT DRIVE

ALIGNMENT. Incentives are a powerful lever that should be pushed

to drive behavior. Agencies should be rewarded for collaboration.

Ultimately they need to be rewarded for great work and business

impact, but consider this to be part of a journey. They need to know

that their piece of the business is protected. While strategy

is shared, execution should be handled by channel experts so

that change is managed gradually. In addition to giving agencies

a safety net, give them a reason to jump higher. For one client

we (us and the ATL agency both) receive a bonus if we help

the client exceed key business targets.

Page 26: Razorfish outlook report 2011 (vol10)

26

KEEP A SLUSH FUND. A key to successful marketing is figuring

out how to integrate always-on and episodic (campaign-based)

communications. Great creative platforms should have plenty

of legs and should be responsive to consumer engagement.

This creates a great opportunity for agency collaboration,

but as the client you need to set aside some money in order

to create relevant content or utilities that can stoke a fire that

you may have created. When we created the Mercedes-Benz

Tweet Race last year, we saw that there was a lot of curiosity

about the tweet-powered vehicles. We jumped on the buzz

and created a spoof video of German engineers driving cars

with their mobile devices. It helped ignite a lot of interest.

You need to start planning for what you can’t plan.

CREATE URGENCY. Without a substantial reason to change

behavior, it will not change. You, the client, have the greatest

ability to create urgency. You need to set a high bar. For instance,

point to competitors or other brands that are doing it well.

And you need to shift the risk. Tell your agencies that if they fail

by trying something new and different, you will embrace it, but

if they fail by not collaborating, it will be a strike against them.

In the end, agency collaboration is rooted in something very

fundamental — trust. Your agencies need to trust each other

to produce great work. By setting up a clear process, demanding

creative collaboration, and planning for the unplanned, you can

go a long way toward setting up the structure and incentives

that your agencies need to build trust amongst each other.

With a solid foundation in place you can count on your

agencies to do their job exceptionally well.

A WAKE-UP CALL FOR COLLABORATION

To get the most out of each agency, make sure you define a clear process for them to work together.

Page 27: Razorfish outlook report 2011 (vol10)
Page 28: Razorfish outlook report 2011 (vol10)
Page 29: Razorfish outlook report 2011 (vol10)

29OUTLOOK REPORT | VOL 10

Mark Taylor VP, Customer Insight Group

LINKEDIN.COM/IN/MARKCHRISTOPHERTAYLOR

Marc Sanford, PhD Director, Customer

Insight Group

@MMSANFORD

Pradeep Ananthapadmanabhan Chief Technology

Officer, VivaKi

LINKEDIN.COM/IN/PRADEEPANANTH

It’s Time for Big Data to Improve Customer ExperienceChannel-­based marketing is dead. The increased amount of data available at the individual consumer level, combined with the proliferation of cloud computing, have allowed savvy analysts and marketers to create a truly singular view of the consumer, regardless of touch point. This single view enables a truly enhanced consumer experience and more efficient use of client and agency resources for decision making. All the customer data out there is worthless if you can’t process it and turn it into actionable intelligence.

Unfortunately, older data processing technologies (such as Relational Database

Management Systems, or RDBMS) are simply not capable of processing data

in volumes that the industry has collectively coined “Big Data” — volumes that

are in terabytes/petabytes. As such, we position the consumer as the only real

appreciating asset and we tie everything together through the use of Big Data.

Awareness of the challenges of a multi-channel world is nothing new, but each

channel touch point represents an immense opportunity for insight. An average

Razorfish client has billions of customer interactions a year across paid, earned

and owned channels. With so many opportunities for insight and learning, we

create a 360-degree view of each individual in the database.

Using integrated Big Data approaches, we are now informing the holistic data

view to gain the fullest understanding of consumer interactions, intent and value

possible. This current shift centers on how customer intelligence across channels

is not just used for insights, but actioned at great velocity to power multi-channel

targeting and personalization, made real through dynamic digital messaging.

WITH CONTRIBUTORS

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Page 30: Razorfish outlook report 2011 (vol10)

30

Better use of the team’s time to focus on what matters

most to their business.

Data enables us to understand customers and to manage

contact and content strategy. Data is a core component of

integrated marketing and, via an integrated approach, we can

speak with a single voice across channels and lines of business.

However, to succeed in a meaningful way at that level of

customer centricity, we have to manage all that data in a way

that holistically fuels customer engagement and experiences.

That effort requires a whole ecosystem of people, processes

and technology.

Even the most sophisticated and modern businesses today are

surprisingly ill equipped to manage even the most basic digital

From insight to action, we’re now finally implementing

consistent and relevant messaging approaches that provide

cohesive consumer experiences.

In our experience, each client using Razorfish’s Big Data-led

performance marketing approach takes a different path. Ultimately,

a client’s path is based on business priorities and what information

can be leveraged from the available tagging and data strategy.

Working with different clients has enabled us to determine

realistic roadmaps.

Holistic integration benefits:

Common Data Marketing Platform (DMP) for reporting,

analytics, targeting and media integration.

A channel and customer view of success.

Metrics that measure end to end, not just in parts.

Decision-making through actionable insights.

A common language for performance across different

teams, brands and markets.

IT’S TIME FOR BIG DATA TO IMPROVE CUSTOMER EXPERIENCE

Paid

Earned Owned

Each touch point is an identifiable interaction and an opportunity to build value.

Email

Search

.com

Mobile

3rd PartyData

Analytics

Reporting

Media

Targeting

AOD

Display

Social

WebAnalyticsPlatform

OWNED

PAID

EARNED

razorfishOPENTM

3RD PARTY (AOR/Client/3rd Party)

Modular approach to platform and services, by fully integrating an organization’s owned, paid and earned channels for insights and targeting.

razorfish-­OPENTM

Page 31: Razorfish outlook report 2011 (vol10)

31OUTLOOK REPORT | VOL 10

marketing standards and activities, let alone jettison forward

into the new world of Big Data techniques.

Through a series of in-depth interviews and client experiences,

Razorfish found a common set of fundamental challenges

holding back meaningful data integration:

Fragmentation of efforts between different teams, tools and

data sources across multiple channels, brands and regions.

Political and fiscal turf protection.

Multiple sales funnel constructs.

Inability to identify the customer.

Inability to quantify the value of customer experiences.

Let’s take a closer look at how our approach to Big Data, using

the razorfishOPENTM framework, can remedy these issues.

Fragmentation

We’re in an era where intelligent use of Big Data pays huge

dividends. Implementing solutions that improve integration of

data is very challenging and complex but not for the reasons

you might think. Much of the technical and analytical challenges

for tapping Big Data have been solved — but failures today

often stem from attempting to use legacy small data solutions,

internal politics, effort fragmentation and failure to manage the

true value of Big Data-based solutions. While a lot of niche

players using Big Data approaches have stepped up to solve

parts of this challenge, building incremental capabilities in a silo

can by default push you further into a silo-based culture and

limit your understanding of the customer.

Any holistic Big Data solution requires a scalable measurement

plan and tagging strategy at its foundation so you can take into

account performance marketing efforts across channels, tactics

and disciplines, with a shared strategy of measurement and

tracking that is scalable across international regions and markets.

The end solution provides a subtle and intelligent approach

that can evolve by integrating and building upon other assets,

data sources and capabilities already in place. This approach

enables a modular and organic ability to evolve and grow, but

with a standardized core. These qualities are not always the

prerequisite in Big Data techniques, but without this there is

no foundation for growth.

There’s a new game in town — it’s cross-­channel data

management and marketing.

Page 32: Razorfish outlook report 2011 (vol10)

32

Turf wars

Crossing organizational units can be tricky. Often clients are

not set up internally for a path to success based on complete

integration and use of available data. Organizations are formed

around channels — one unit owns the Web site and its data,

another owns CRM and email, another may own Web media

and yet another may be in charge of social media. Worse yet,

each silo may have its own analytics arm. The only way to be

part of this organizational conversation is to think big. We have

gained phenomenal success by leveraging Big Data-based

techniques as part of a modular, digital roadmap that directs

current and future business investment in the next 100 days/12

months/3 years. Be prepared to think big even while starting

small, and determine your starting point and roadmap — no

matter how audacious your goals.

A Razorfish global technology client decided their initial priority

was to gain cross-channel insights before embarking on targeting

and deep analytics. This was the foundation starting point for their

organization and it ensured they gained political capital across

their business model through an evidence-driven, customer-

centric approach that enabled financial modeling of return on

investment. Their next phase focus is on actioning that data for

targeting across display advertising and the Web site.

Another Razorfish client, a major global retailer, recognized

that they had a wealth of underutilized offline and digital data.

They decided to leverage Big Data approaches to integrate

multiple channels and power media, dynamic re-messaging,

analytics and more. The ultimate purpose is to enhance the

value of those relationships by aggregating information about

the customer and communicating with them in the most relevant

and engaging way. Previous iterations of this approach resulted

in a three- to five-time increase in return on ad spend, and a

significant decrease (about 65-70 percent) in cost per acquisition.

Each phase typically pays for itself in weeks, while providing the

funding for the next incremental phase. This becomes a sound

IT’S TIME FOR BIG DATA TO IMPROVE CUSTOMER EXPERIENCE

MEDIA AGENCY OF RECORD (AOR)

Report

DFA

Display

MEDIA METRICS

MULTIPLE AGENCIES

Report

Buddy Media

SOCIAL METRICS

Social

SEARCH AOR

Report

Marin

MEDIA METRICS

Search

DIGITAL AOR

Report

Omniture

SITE METRICS

.com

DIGITAL AOR

Report

Flurry

MOBILE METRICS

Mobile

IN-HOUSE TEAM 1

Report

ExactTarget

EMAIL METRICS

Email

IN-HOUSE TEAM 2

Report

ATG

MERCHANDISING METRICS

Online Retail/Store

IN-HOUSE

Report

Custom

TENURE AND PRODUCT VALUE

Transaction Data

RESEARCH AGENCY

Report

Custom

ATTITUDINAL

Profiles & Segments

Example of a siloed view of data management and reporting.

OWNED

PAID

EARNED

3RD PARTY (Client and 3rd Party Data)

Page 33: Razorfish outlook report 2011 (vol10)

33OUTLOOK REPORT | VOL 10

position to be in when convincing your peers of the rationale

and business case to fund such solutions.

Big Data can be organized without a major disruption or re-

architecture of existing structures, internal teams, vendors,

agencies, platforms or focus. Instead, our approach to Big Data

utilizes an open standard designed to exploit existing assets

and fit the best custom solution for business environments.

This approach has an evolving set of modular relationships

managed as a single solution, resulting in a single and holistic

view of the customer based on all available data. Our clients

are using this common view to engage and encourage their

different teams to speak in the same language.

Multiple sales funnel constructs

Funnel management is where people are getting clever with Big

Data, however it runs the risk of solving only one part, rather than

the whole. We know that leveraging a single view of the consumer

drives value at all levels of the funnel. So why do many continue

to approach client problems and challenges as one-offs or focus

on just one area of the funnel?

Too many distributed engagements will lead to:

1. Single point-in-time solutions that require rebuild with

every new engagement.

2. An additional data silo that requires more time and effort

to manage and process.

razorfishOPENTM targeting roadmap.

Target 1.0 Target 1.1 Target 1.2 Target 1.3 Target 2.0

Heavy use of CT with no

dynamic adsDescription

Display or siteDelivery Option/

Channel

Low complexityBenefits

Some time to set up the offer, strategy

and creativeConsiderations

1.5 X ROASTypical ROI

Dynamic ad, last action only

Display Display Display

Fast to market

Access to data is limited

3.5 X ROAS

Higher relevance and full data access

Greater set-­up investment to ensure platform is in place

5 X ROAS

multiple data sources

Increased relevance and huge long-­term

incremental data benefits

Time to market is longer

~6.5 X ROAS

multiple data sources

delivery

Display, site, email, mobile, call center

Channel agnostic

Greater cross-­channel business coordination

~8 X ROAS

Page 34: Razorfish outlook report 2011 (vol10)

34

For example, the illustration on the right shows how an effective

re-messaging program will grow the bottom of the funnel. However,

if this becomes a one-off without integrated implementation and

access to the data, the solution becomes a very clever silo at the

expense of the broader opportunity.

The reality is that the rules and the data to enable an integrated

view and management of the funnel would need to come from

first-party data via a DMP solution and the organization’s data

assets, rather than a third-party data provider. Third-party data

intelligence can provide these larger insights into what’s working

and where there’s opportunity for more scale. Data providers

can be joined to first-party data, not the other way around.

Within Razorfish’s framework for integrating data and services

(described below as razorfishOPENTM), targeted, dynamic ads

are combined with a Demand Side Platform (DSP), such as

Audience on Demand (AOD), to match impressions to users

identified in real time. This allows you to only reach users that

have been already “qualified,” and avoid upfront agreements

and negotiation by paying the market price for users meeting

criteria defined in the audience segmentation. By reaching the

right audience at the right price and allowing the ability to

control bids at a cookie level provides a great deal of efficiency

and relevance. This integration also enables the ability to bring

a wide array of data at the bottom of the funnel to the audience

at the top of the funnel.

Inability to identify the customer

Razorfish implements a customer-centric approach through an

organized framework of measurement and tagging that tracks

IT’S TIME FOR BIG DATA TO IMPROVE CUSTOMER EXPERIENCE

DIGITAL OFFLINE

Consideration

Awareness

Retargeting

Conversion and remarketing is only part of the answer.

Funnel management is where people are getting clever with Big Data.

Page 35: Razorfish outlook report 2011 (vol10)

35OUTLOOK REPORT | VOL 10

all digital business activity and harnesses the full stream of

data as the core basis of the single view of the customer. From

day one we leverage all existing assets, people, agencies and

platforms, without a big, disruptive overhaul. Chances are these

existing components are there for a reason and are providing

value, but getting that cross-functional view and line of sight is

the first objective.

Inability to quantify the value of customer experiences

Organizations are increasingly demanding faster value return on

their marketing investments. Razorfish has found that businesses

now more than ever need a true, meaningful understanding

of what drives customer value. Rather than using Big Data to

improve one area of the customer experience, we need to build

toward meaningful interactions at a customer level and progress

the value of their brand relationships over time.

We have seen our clients quickly moving toward a culture that

understands customer data as one of its most valued assets.

Focusing on customer value helps companies move away from

channel performance and toward greater customer-centricity.

But to calculate customer value, companies must fully utilize the

recency of interactions, along with the required behavior, revenue

and relationship metrics. A key challenge businesses struggle

with is finding advanced analytical skill sets and analytics-based

approaches that can leverage and interpret that data to determine

the key levers that drive value within their organization, or at

least within a specific team’s control.

Behavioral data captured by the razorfishOPENTM first-party DMP on client-owned assets integrates with Media DSPs third-party data to help build more precise audience segments and add to our clients’ audience buying capabilities.

Call Center

Open & DSP Audience Targeting Integration

Enhanced Segmentation& Data Provision

Pub

lish

ers

AUDIENCE/PROSPECT/ CUSTOMER

PROSPECT/ CUSTOMER

CUSTOMERMANAGEMENT

CUSTOMERMANAGEMENT

3rd Party DSP and Data Providers

razorfishOPENTM

1st Party DMPClient

Proprietary Data

.com

Using an integrated DSP allows you to only reach customers and prospects that have been "qualified" by razorfishOPENTM.

DM

Mobile

Email

Retail

Paid

Owned

Earned

Consistent data collection across touch points enables analytics, segmentation, targeting and reporting. For example, a customer falls into segment 8, based upon razorfishOPENTM rules. Razorfish then targets customer experience, agnostic of channel (represented by orange dots).

Page 36: Razorfish outlook report 2011 (vol10)

36

ReportingMedia

AnalyticsTargeting

razorfish-­ OPENTM

IT’S TIME FOR BIG DATA TO IMPROVE CUSTOMER EXPERIENCE

We define and value the segments of customers we want to

engage with and create Big Data-applied algorithms to create

a new type of value segmentation model that can operationalize

differentiated experiences at high velocity. We not only deliver

unique and consistent experiences to these customers, but also

leverage our knowledge about them to bid for the opportunity

to deliver those experiences. From the beginning, we value

the revenue and other business impact of the opportunity and

in the end we prove it.

*razorfishOPENTM tagging framework

Report Report Report Report Report Report Report Report Report

Display

MEDIA METRICS

MEDIA AGENCY OF RECORD (AOR)

SOCIAL METRICS

MULTIPLE AGENCIES

MEDIA METRICS

SEARCH AOR

SITE METRICS

DIGITAL AOR

MOBILE METRICS

DIGITAL AOR

EMAIL METRICS

IN-HOUSE TEAM 1

MERCHANDISING METRICS

IN-HOUSE TEAM 2

TENURE AND PRODUCT VALUE

IN-HOUSE

ATTITUDINAL

RESEARCH AGENCY

Social Search .com Mobile EmailOnline Retail/ Store

Transaction Data

Profiles & Segments

Silo reports provide a detailed view at a channel level and have a role in optimizing channel performance.

Ad serving tags provide a holistic view across the customer journey, at the unique customer level.

razorfishOPENTM tagging framework that tracks cross-channel business activity.

* *

*

*

** *

* *

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37OUTLOOK REPORT | VOL 10

We have seen ourclients quickly movingtoward a culture thatunderstands customerdata as one of itsmost valued assets.

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39OUTLOOK REPORT | VOL 10

Humanity Check — What Consumers Really Think About TechTo get outside the digital marketing bubble, we conducted a series of focus groups, in-­depth interviews, and ethnographic sessions in San Diego, San Francisco, Seattle, Chicago, Ft. Lauderdale, and Portland, Ore. The goal was to uncover what’s really going on in the everyday user’s technology life. Among the insights that emerged: people still need their physical space, brands get points for effort, there’s a new kind of couch potato and there’s plenty of tech-­fueled confusion in consumers’ lives.

Talk to a few tech pundits about what’s next and you’ll very quickly see a calcified

conventional wisdom form. Facebook and/or Twitter are totally integrated into

everyone’s life and everyone wants to share everything. Quick Response (QR) codes

count as progress. Google and Apple are loved by all and the world is waiting

to see what both will do next.

But talk to real people and you get a different story. To get outside the digital

marketing bubble, we conducted a series of focus groups, in-depth interviews, and

ethnographic sessions in San Diego, San Francisco, Seattle, Chicago, Ft. Lauderdale,

and Portland, Ore. The goal was to uncover what’s really going on in the everyday

user’s technology life. There were 56 respondents age 18-49, all of whom had

broadband access in their home, a smartphone and a computer. But they didn’t

identify themselves as super users or even technology enthusiasts.

OUTLOOK REPORT | VOL 10

Brandon Geary SVP, Strategy

@BRANDGEAR

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Page 40: Razorfish outlook report 2011 (vol10)

40

Five core observations rose to the top for us:

1. PEOPLE NEED THEIR SPACE

While much of the business news centers on the death or

decline of old retail models — bookstores, movie theatres,

consumer electronics and music — we found people continue

to express emotional attachment to the store experience,

despite the shuttering of former stalwarts like Borders. This is

backed up by a recent Accenture survey that found nearly

75 percent of consumers consider a storefront for digital

communications products to be important.1 We found strong,

positive feelings about digital music, the rise of new content

delivery mechanisms like Netflix, and digital content delivered

on the Kindle and iPad, with limited longing for the old days.

“I don’t miss CD boxes to be honest, and lugging books around

wasn’t all that great,” said 29-year-old Cathy. The risk for

retailer disintermediation clearly remains high for media products.

But the desire for consultation and experiences — particularly

shared experiences — remains alive and well.

SOLUTION: GIVE PEOPLE A NEW REASON TO COME BACK. We found

an openness to reinvention of old models with reliance on physical

space. On music — “Why don’t they broaden the experience

to include more physical objects around the music or have more

events associated with the medium,” said Colin, 27. On movie

theatres, 30-year-old Lisa said, “I’d like to see the opportunity

to rent movie spaces for friend groups so that movies become

more like karaoke in Korea.” Big box retailers under pressure

from Amazon.com and disruptive models should consider

re-evaluation of space, not just the product in question.

2. MORE KNOWING, LESS THINKING

Apps, search and social media are rapidly changing human

interaction at the level of the conversation. Knowing stuff has

become easy, which has had a reductive effect on chats that

once might have been more discursive. “When we’re talking

about something we aren’t sure of, we all just look up the

answer and it’s over,” said Heather, 32. In-person interaction

has evolved to become more of an information sharing exercise

and less of a conversation around ideas where one person

1 “The Value, Role and Performance of the Physical Retail Channel for Communications Service Companies: A North American Perspective,” Accenture, http://www.accenture.com/SiteCollectionDocuments/PDF/Accenture_Communications_Research_Physical_Retail_North_America.pdf (2011).

HUMANITY CHECK — WHAT CONSUMERS REALLY THINK ABOUT TECH

Provide a small delight for customers. You don’t have to go big to get impact.

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41OUTLOOK REPORT | VOL 10

builds on another’s thoughts, building on another’s thoughts.

“I check my friends’ stuff more to see what information I should

know now,” said David, 32.

SOLUTION: THE BRAND HAS TO TAKE A STAND. For brands interested

in using social media to join a conversation with their consumers,

they may find there is less conversation to join and that they

too are just sharing information or listening in on information

share. Or brands may need to spark conversations. In a world

of information sharing, consider asking a question, creating

a debate and offering an opinion in attempt to get engagement.

3. BRANDS GET POINTS FOR EFFORT

While only a few big successes in North America appear to get

the majority of mainstream media coverage (Facebook, Apple,

Google, Angry Birds and LinkedIn), we have found the perception

of innovation increasingly comes from the trial of new things,

regardless of whether or not the new thing is a long-term

business success for the company that launched it. Google

is consistently praised in projective exercises as innovative,

despite an inability of users to pinpoint exactly what those

innovations are. “Google is like Apple,” said Steven, 41. “Just

always doing new things.” Companies like Starbucks and Nike

are thought to be more suitable for reinventing dying industries

like books and music, despite not being media companies.

“Starbucks could make a better bookstore than Barnes & Noble

could,” and “Apple could sell anything.”

SOLUTION: KEEP ON MAKING. Companies don’t have to get

everything right to get credit. Perceived effort associated with

releasing products and services creates a positive cumulative

effect for the brand. For brands remaining on the sideline

or fearing a lack of focus, consider placing smaller bets on app

or development initiatives to provide a small delight for customers.

You don’t have to go big to get impact.

4. MEET THE NEW COUCH POTATO

Historically, digital pundits have promised a more interactive

future, in which users move away from passive, couch potato

viewing to more active engagement. While the amount of user-

generated content and sharing supports this movement, we

have found everyday users increasingly leaning back in their

digital consumption habits. Social media is described as a

more ambient activity. “[Facebook] is usually a drag. I just feel

lazy like I’m seeing the same old stuff and looking at people’s

profiles. I feel somewhat guilty about it sometimes, like I’m

wasting time.” Twitter, originally categorized as a social tool,

is described more as a curation tool. “I don’t really tweet

anymore. I just see what I should think about reading.”

And social media in general is making in-person interaction

increasingly difficult to motivate or organize. “It’s just so hard

to make it (an in person meeting) happen now,” said Tran, 29.

SOLUTION: DON’T BE AFRAID TO BE A PUSHER. Brands that have

long viewed digital as an engagement medium should also

consider more opportunities and ideas that are more push

in nature: video- and photo-based status updates, viral shorts

and simple games and activities.

5. THE RISE OF DIGITAL CONFUSION

In launching new digital services in an app-filled, multi-device,

multi-operating system world, consumers have become

increasingly confused by messages. They’re less certain about

the difference between a browser and operating system, PC

and tablet, and OS and device manufacturer than ever before —

“I’m not sure what Chrome or a Chromebook is.” “I’ve used

Bing, but what does it do again?” While not every brand can

be Apple from a product perspective, few beyond them appear

to be delivering messages that are connecting.

SOLUTION: DITCH THE STRATEGY AND GET TO CLARITY. As marketers

well versed in the creation of the emotional benefit look to new

services for old or new brands, it’s paramount they continue to

scrub their message strategies to get to the essential elements that

drive clarity. Even more than before, attention and/or emotional

attachment appear to be less of an issue than understanding.

Digital devices, social platforms, mobile and commerce are all

changing consumer behavior rapidly, but not entirely in the ways

many had predicted. In the future, it’s the brands that rethink

space, not just the product, take a stand in the social space,

push content that’s easy to consume and simplify the message

that win. This means the most surprising thing about the future

might just be its similarity to the past.

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43OUTLOOK REPORT | VOL 10

How the Social Cloud Can Accelerate Brand InteractionFrom March 2010 to March 2011, Facebook online video and mobile device consumption time were all up, but the rest of the Web was down. This means that while these social areas have grown, they’ve also taken users away from more established sites. Brands need to take the conversation to where the users already are. Social cloud services connect digital experiences with Facebook, Twitter, LinkedIn, Google, Microsoft and other social services. We’ve identified some dos and don’ts to take full advantage of these APIs.

The Web isn’t dead, but it sure has taken a hit. Wired Editor Chris Anderson’s

prediction that the free, interconnected world of the Web would be replaced

by the paid-for, walled gardens that are apps hasn’t necessarily come true.

Yet the Web is a changing place with fewer winners and more losers because

of audience consolidation around a few key platforms. From March 2010 to

March 2011, Facebook use was up 69 percent, online video consumption was

up 45 percent and mobile device time was up 28 percent.1 The rest of the Web

was down 9 percent. This means that while these areas have grown, they’ve also

taken users away from more established sites.

With social and video sites, the users are already there — you don’t need to drive

them to your destination site. Instead, you can take the conversation to where the

OUTLOOK REPORT | VOL 10

Ray Velez Global Chief

Technology Officer

@RVELEZ

Rafi Jacoby Social Technology Lead

@RJACOBY

1 Ben Elowitz, “The Web is Shrinking. Now What?” Digital Quarters, June 2011, http://digitalquarters.net/2011/06/the-web-is-shrinking-now-what/.

WITH CONTRIBUTOR

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Page 44: Razorfish outlook report 2011 (vol10)

44

users are already. For instance, Facebook makes up 25 percent

of all page views, with users averaging 15.5 hours per month

on the site. This requires a rethink on how you spend your media

dollars to acquire users.

In order to acquire information about those users, all you need

to do is offer something small: a fun experience, chance to win

something or a coupon (which do amazingly well).

When you have reached the right audience, the users you have

acquired will continue spreading the message for you. According

to “Zuckerberg’s Law,” users share twice as much content every

year as the previous year. Your brand’s content will be disseminated

by real people to the people who trust them (high “earned” value).

In the future, the brand with the most compelling content wins.

Arguably this is already happening, but we need to develop new

metrics to understand this. What is clear is that users want

to share creative, fun and engaging content — not product

specs or regular marketing collateral.

Soon, more experiences will be connected: tweeting from inside

an Xbox game that they have unlocked a new level; sharing

the act of viewing a TV show on Twitter/Facebook/GetGlue;

leading other users on an augmented reality treasure hunt

on their phones while tracking the progress inside a Facebook

leaderboard and tweeting out results.

With the rise of social check-in services (Foursquare, Twitter,

Facebook), you can have trackable digital marketing tying into

brick and mortar. Then, you can build an experience around

that location with communities, discussions, deals and events.

You can learn exactly how far users will go to make a purchase,

which users are more likely to purchase where, and what

other locations they frequent that might be interesting for your

business — all without commissioning surveys or having to

integrate with many different point-of-sale systems.

Social cloud services provide your digital experiences or Web

properties with the ability to connect up with Facebook, Twitter,

LinkedIn, Google, Microsoft and other social services. These

services come in the form of Application Programming Interfaces

(APIs) that your technologist can integrate. Whether your digital

experience is a mobile application or a traditional desktop site,

these APIs are available.

Marketing and business needs a blueprint for how these

all interact. The graphic, to the right, describes the key API

categories in the social space.

Three core areas make up social APIs

1. AUTHENTICATION

The first core API area is authentication or the ability to leverage

the services of a social network to help people gain access

to your digital property. You can now enable users to log in

to your Web properties without having to create a new account.

Registration through a social cloud service breaks down

the barrier to entry of creating an account. OAuth and OpenID

are the main technology standards for ensuring secure access

to digital sites and properties. Sites can support both or just

one, but ultimately these technologies can have a drastic impact

on the number of folks who sign up. Once authenticated, there

is the concept of profile data sharing or the sharing of data

elements about people — pictures, birthdate, email, etc.

Obviously, there are privacy considerations that have slowly

evolved. For example, when we first used Facebook Connect

profile sharing, anyone could grab a person’s picture, but then

Facebook evolved their privacy controls to give users control

of who can see their picture. Of course there are limitations

on what you can do with the identification, but at that point you

can grab more information from the person contextually to your

experience as needed. Lastly, it’s important to make sure you

use whatever the connection type is, whether OAuth, OpenID

or proprietary with secure sockets layer. This will ensure the

hacker hanging at Starbucks doesn’t steal your password.

After logging in, you can leverage locally saved tokens so

users don’t have to login to Facebook across every site they

go to during the day. One login will work. Letting users pick

their account type to log into (Facebook, Twitter, etc.) affords

the most flexibility, and you can leverage a lot of the same

development when you code to a standard like OAuth.

HOW THE SOCIAL CLOUD CAN ACCELERATE BRAND INTERACTION

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45OUTLOOK REPORT | VOL 10

2. CONVERSATION AND SHARING

The second core API area is commenting and message

boards — basically the ability to create messages around

a topic area. Let users drive conversations like comments

or message boards without having to write custom code to

support it. Consider a Twitter message a conversation around

a topic area, or a Facebook wall post a growing interaction

for your experience. A lot of the API needs in this area are

bringing order to the chaos. The Facebook plugins are pretty

easily implemented and high value. Replace your own comment

boards with Facebook comments — no additional sign-up

required, and content can be shared on a user’s wall. It’ll drive

traffic in and out of your Web property. Technologies available

in the Software as a Service (SaaS) approach such as DISCUS

or Echo enable you to bring the messaging to your site, while

still existing on Twitter and Facebook. Considerations down the

line include the ability to moderate and monitor posts, which are

especially important when considering branded experiences.

3. SOCIAL GRAPH

Lastly, one of the most important social API areas is sharing

of the social graph. That means not only connecting with the

current person, but with their friends as well. All of this is made

available through the API. Similar to OAuth and OpenID, there

is a technology standard for accessing this information called

OpenSocial. While this has evolved considerably over the

last couple of years, it still seems to lack broad adoption by

the major players, most notably, Facebook. For now it seems

proprietary API calls to social engines are still the norm.

Authentication, commenting and social graph sharing are

the three key social services, but there are lots of other social

services that can also power your digital experiences, whether

mobile, desktop or in-retail. These will continue to grow as

people innovate in the space. Social video services like Vimeo

and YouTube allow you to embed your videos in your own

digital experiences while still allowing the video content

to be accessible from the YouTube and Vimeo platforms.

DATA PORTABILITY

OAUTH/OPENID/ CUSTOM

PROPRIETARY

FACEBOOK

GOOGLE

TWITTER

LINKEDIN

WINDOWS LIVE

FACEBOOK

GOOGLE

WINDOWS LIVE

TWITTER

LINKEDIN

Social Application Programming Interfaces (API)

Social Graph

SharingAuthentication

Commenting & Message

Boards

Profile Data

Sharing

OPEN SOCIAL

TWITTER

ECHOFACEBOOK

DISCUS

Page 46: Razorfish outlook report 2011 (vol10)

46

The obvious benefit is that you save on bandwidth costs, but

the even greater benefit is that you are where users are. You

create a branded experience on YouTube, and then extend that

experience through YouTube embed codes onto your branded

property. YouTube continues to grow their API to allow more

flexibility around how your player looks and whether or not ads

should show up on your videos.

Simple plugin buttons such as Facebook’s “Like” and “Share,”

Google’s “+1,” and Twitter’s “Tweet” and “Follow” dramatically

lower the barrier to users sharing content from your site out

to their entire social graph.

Data resources

If social cloud services accelerate traffic to your branded digital

experience, core cloud infrastructure services will enable your

social cloud services. Infrastructure as a service or rent-as-you-

go Infrastructure as a Service (IaaS) or Platform as a Service

(PaaS) let businesses like Zynga, Groupon, LivingSocial and

Airbnb go from nothing to $1 billion valuations with negligible

IT overhead, scaling when they need it, without overbuying

capacity. But make sure you architect for fault tolerance (see

AWS failure this spring). PaaS leaders make deployment,

database and background jobs easy: consider Heroku, AppFog,

Engine Yard, VMware and Cloud Foundry.

We can learn from the technologies, processes and concepts

that have enabled huge social cloud growth for those companies.

They are using PHP (Facebook), Ruby on Rails (Twitter, Groupon,

Airbnb), Python (Yelp), MySQL, unobtrusive JavaScript, server-

side JavaScript, cloud hosting, Scala, Clojure, MongoDB, CSS3,

HTML5, REST, JSON and WebSockets. These technologies

are being used by cutting-edge companies and they are

contributing their cutting-edge work back to the community.

Plus they are generally much more cost-effective than traditional

enterprise-based approaches, stuck within slow-moving,

expensive corporate IT data centers. Agile approaches have

pushed innovative approaches like continual builds of code

or continual releases of production code. Both approaches

are made practical through platform cloud services.

Cloud-based performance monitoring tools like New Relic can

identify performance problems in your application and give

you starting points for optimization. LinkedIn uses this kind

of information to identify functionality that can be replaced

HOW THE SOCIAL CLOUD CAN ACCELERATE BRAND INTERACTION

Learn exactly how far users will go to make a purchase, which users

are more likely to purchase where, and what other locations they frequent.

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47OUTLOOK REPORT | VOL 10

with higher performance languages and frameworks, migrating

key services over to Node.js and Scala to take advantage

of their high degree of parallelization. If you need deeply

integrated analytics, a service like Mixpanel solves storage,

presentation, organization, querying and export problems,

and provides simple toolkits for instrumenting both the server

and client components of your Web app.

Build with multiple screens in mind. A single codebase can easily

support Web, Facebook canvas and mobile touch if you abstract

out your views well and use a framework that is designed for

such flexibility. Why not launch on three surfaces simultaneously

for almost the same price in development? There’s no need to

think of your site and your Facebook presence as completely

different animals. They can be two views of the same thing, with

slight differences. Platform cloud services can help you optimize

and speed delivery, regardless of the screen. Look at cloud-based

caching delivery networks like Amazon’s CloudFront or Google’s

Page Speed to accelerate delivery, regardless of targeting a

Facebook page or a traditional Web page.

Cloud services like Mashery or Apigee enable your brand to get

into more places than just your owned digital properties.

Razorfish’s Open Digital Services approach helps clients’

strategic view of services. Think about freeing some of your

data (product catalog, etc.) with a public API and see what

the community might build around/for you.

Cautions

There are many useful services available to build your

applications. Yahoo! Query Language (YQL) lets you query

a myriad of pieces of information against many of the Yahoo!

properties. Geocoding services identify user locations and

help you provide locally interesting content. It is important

to understand how dependent your application is on these

services and what their limitations are. Most will have limits

on the number of API calls you can make; it’s advisable

to build a layer into your own application to cache whatever

you can to avoid hitting those caps. A local cache will also

keep your application running and useable if the services

experience an interruption. Lastly, ensure that you are

subscribed and follow any announcements around APIs;

they have change deadlines and if you don’t update in time

you can be out of service.

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48

If you build something that depends on the major social networks,

your app will require occasional work in order to keep in sync

with the latest changes, as well as monitoring to make sure

that things outside of your app are live and working. During

one campaign on Twitter, the tweets were not all appearing

in the search feed and Twitter had to help fix an issue on their

side. Facebook has had several major changes on their API,

with the latest coming Fall 2011 — a security overhaul of the

application authentication system that will disable applications

that do not comply. In the past, Facebook switched from

its proprietary Facebook Markup Language (FBML) to IFrames,

but if you had an app that hadn’t launched yet, you had

to make sure to pre-provision it on Facebook or you wouldn’t

be grandfathered in and would have to scramble to do a rewrite.

Social conversations are hard to control. You may want to take

a fresh look at how you relate with your consumers. Some

brands have elected to be very hands-off. Others are very

engaged. Third-party social monitoring tools (Context Optional,

Involver, Buddy Media) and a community manager are a must

in that case for doing escalation, bad word filtering, auto delete

and more. This can be a recurring budget consideration.

Your Facebook page should be a destination with many doors,

not just a flat campaign. Engaged users spend more time

with your brand, and become your biggest advocates — often

jumping in to defend the brand on the wall before the brand

can respond. So give them a reason to stay and interact

with something more than a lead generation form. Consider,

“Why would someone share this with their friends?” when

designing your social presence.

Don’t oversaturate your fans with content. You’ve spent time

and money on earning them, so make your posts to their

streams or tweets compelling and not too frequent in order

to avoid them “un-liking” or blocking you.

Social isn’t a one-off. You’ve acquired lots of fans so keep

using them. Think of longer strategies, not just short campaigns.

You built an app that has 3 million users — don’t just end,

extend. Those people are linked to you now, so keep giving them

something. Add more content and create new ways to interact.

This probably involves a new way of looking at budget.

HOW THE SOCIAL CLOUD CAN ACCELERATE BRAND INTERACTION

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Beyond the Banner — Unleashing the Power of Digital to Drive Topline GrowthIndustry leaders have to reinvent themselves periodically to maintain their preeminence. But as the rate of technology-­driven change continues to increase over time, the speed and frequency with which companies must reinvent themselves also increases. And unfortunately for industry incumbents, technology-­driven disruption tends to favor new entrants, who are often faster, hungrier and unencumbered by legacy systems and processes. We believe digital should be at the core of any industry leader’s growth strategy, and we’ve identified three ways digital can drive step-­change improvement in topline growth — above and beyond efficiency maximization of existing efforts.

The first wave of digital disruption came crashing into the business world about

15 years ago, when the Internet first exploded as a consumer technology. Since

then, leading companies across industries have been scrambling to master the art

of marketing and selling online. Most large companies now maintain multiple Web

experiences and marketing programs — all of which require periodic upgrades

in the form of redesigns and replatformings, as well as ongoing testing and

optimization. (All bread and butter for digital agencies, of course.)

Meanwhile, in what sometimes seems to be a parallel universe, pure-play digital

startups continue to spawn, swarm and thrive, often squeezing out weaker

competitors and overturning established industry structures in the process.

Industry leaders have had to reinvent themselves periodically to maintain their

preeminence. But as the rate of technology-driven change continues to increase

over time, the speed and frequency with which companies must reinvent

OUTLOOK REPORT | VOL 10

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Tim Perlstein Group VP, Strategy

LINKEDIN.COM/IN/TIMPERLSTEIN

Bethany Fenton VP, Experience

LINKEDIN.COM/IN/BETHANYFENTON

Page 52: Razorfish outlook report 2011 (vol10)

52

themselves also increases. And unfortunately for industry

incumbents, technology-driven disruption tends to favor new

entrants, who are often faster, hungrier and unencumbered

by legacy systems and processes.

Now, as companies emerge from the recession looking to deliver

step-change improvements in revenue growth — and as growth

becomes harder and harder to find within existing markets —

digital channels, programs and agencies must do more than

deliver incremental improvements from evolutionary change.

Optimizing your way to greater efficiency is good, but not

enough. Digital can and must do more.

Digital should be at the core of any industry leader’s growth

strategy. In fact, given the relative maturity of established

platforms and programs — and the ever-increasing competitive

pressure from new entrants — now is the time to ignite a new

round of digital innovation within your organization. To begin

the conversation, we’ve identified three ways digital can drive

step-change improvement in topline growth — above and beyond

efficiency maximization of existing efforts.

1. NEW MARKETS

As domestic growth in core segments becomes harder to come

by for U.S. companies — and as emerging markets continue

their dramatic expansion — we expect industry leaders to seek

new growth from markets that are new to the company and/or

broadly underserved by their industry. Digital can and should

be a powerful, cost-efficient method of reaching and serving

these markets.

That said, leveraging digital for new market entry isn’t as simple

as launching a version of your Web site in your target market’s

local language, although this might not be a bad start.

Localization means more than translation. For online retailers,

serving international markets means dealing with foreign

exchange rates, taxes, sizing systems and — of course —

fulfillment. Despite the complexity, retail giants Macy’s,

Barneys New York, PBteen, and JoS. A. Bank all extended

their ecommerce operations internationally this year. Macy’s

now has an ecommerce presence in 90 countries, although

its physical stores are all within the U.S.1 The logic is

obvious: With domestic growth stalled, foreign markets offer an

appealing opportunity to extend brands and capture growth while

requiring only minimal capital investment (compared to rolling

out more brick-and-mortar operations).

Of course, overseas growth isn’t just for retailers. Even

manufacturers for whom digital is not a direct sales channel

are using digital tools and partnerships as a cornerstone

of market entry strategy. As always, deep knowledge of local

players and local infrastructure is key. For example, given

the relatively high adoption of mobile phones (versus desktop

PCs) in developing countries, some Consumer Packaged

Goods (CPG) companies are looking to advance by partnering

with local telecom operators to expand mobile coverage —

in exchange for marketing access to consumers. Other firms,

such as General Mills, leverage digital for insight and customer

collaboration, as well as outbound communication. In China

and other markets where standard retail channel data

is inconsistent or nonexistent, General Mills is building

a proprietary database of consumer households, and using

real-time digital communications tools to allow consumers

to voluntarily share data on their preferences and behaviors.2

These are just some of the ways in which digital can support

successful new market entry — well beyond the banner ad. We

expect to see much more innovation in the coming year, as early

initiatives prove successful and best practices begin to emerge.

2. ENHANCEMENTS FOR EXISTING PRODUCTS AND SERVICES

“Digital” can be more than a marketing or sales channel; it can

fundamentally transform a product or service by providing

additional functionality and consumer value. Even companies

BEYOND THE BANNER — UNLEASHING THE POWER OF DIGITAL TO DRIVE TOPLINE GROWTH

1 Allison Enright, “Macy’s Goes Global,” InternetRetailer.com, June 27, 2011, http://www.internetretailer.com/ 2011/06/27/macys-goes-global.

2 2011 Financial Performance Report, PWC/Grocery Manufacturers Association, page 43.

Page 53: Razorfish outlook report 2011 (vol10)

53OUTLOOK REPORT | VOL 10

accustomed to delivering tangible, “real world” value propositions

should treat digital as a core component of product strategy —

not just marketing or sales.

The most obvious example of this dynamic is the ongoing upheaval

within the media industry, where traditional core “products”

have been entirely digitized, radically expanding the dimensions

of competition and dramatically increasing the importance

of distribution channels and the overall “experience” of content

access. The list of recent digital product innovations within

the media industry seems endless. It encompasses multiple new

access platforms, ancillary or “exclusive” premium content

options, user-generated or participatory content development,

sharing, commentary, other social features, and on and on.

A more subtle but equally interesting evolution is happening

within the hardware and networking industries that typically

support content delivery. Digital TVs are becoming “smart,”

adding Internet connectivity and their own application platforms.

Network providers are delivering increasingly integrated digital

services with new, digitally enabled functionality (set TV

recordings from your smartphone, view caller ID on your TV,

manage call routing and voicemail settings from your PC,

etc.). Add in a host of innovative new hardware options (Roku,

Boxee, Slingbox, Apple TV, Xbox 360) and service providers

(Netflix, Skype, Google TV), and you have a full-on battle for

control of the digital home.

More established providers of “traditional” products and services

cannot help but be affected by this domestic, digital landscape

and the new consumer behaviors it generates. Home security

and automation providers must inevitably develop new strategies

and products to compete within the increasingly networked

home. (ADT’s Pulse product is a good, early example of this

trend.) Consumer electronics manufacturers may find ways

to embed digital “smarts” in appliances beyond TVs. Even

supposedly staid utility companies may get in on the act,

with more efficient and convenient controls, monitoring

and service solutions.3

3 See for example: M2M and Embedded Strategies, Juniper Networks, May 2011, page 81-85.

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54

For service providers outside the home, digital enhancements

are becoming just as commonplace — and perhaps even more

important. The ability to conduct secure online banking

or day trading from our smartphones is something many

of us already take for granted. (Can you even imagine opening

a new checking account that didn’t offer free online bill pay?

We can’t.) Travel providers, from airlines to cruise lines, are

scrambling to provide ever-more convenient digital applications

for booking, trip management and customer service — both

during and after travel. Even brick-and-mortar service providers

are finding ways to integrate digital add-ons within their core

experiences, whether it’s providing access to a vastly extended

assortment (JCPenney’s in-store kiosks) or free, premium digital

content (Starbucks’ “Digital Network”) while on-premises.

The lesson behind all these examples is the need to view digital

as an arena for fundamental product innovation, not just

marketing communications. Rapid technology change continues

to open up vast, uncharted whitespace for products and services

yet to be invented. And as new and established players across

multiple industries continue to extend their offerings into the

digital realm, the consumer’s digital ecosystem becomes an

ever-richer environment within which to innovate.

3. ENTIRELY NEW BUSINESSES

This brings us to the third major digitally driven growth

opportunity: the development of entirely new business lines.

Although it’s still early days, we’re seeing more and more

companies in “traditional” industries using digital to launch new

businesses and ventures that are adjacent (or even outside)

their core comfort zones. An even greater number of companies

now maintain digital innovation skunkworks, with a mission

to identify and pursue promising opportunities outside the

umbrella of the main organizational structure and brand.

Just a few examples should help paint the picture. GameStop,

the leading physical retailer of video games, made a splash

this summer when it announced its move into online streaming

of console games — clearly a hedge against declining physical

retail sales of a fundamentally digital product. It’s a move that

requires fundamentally different capabilities and processes

from the core retail business, and will likely benefit if managed

separately from store operations. Additionally, GameStop

maintains a vibrant portfolio of digital properties, including

Kongregate.com and GameInformer.com, which could form

the seeds of future all-digital ventures.

Now is the time to ignite a new round of digital innovation within your organization.

BEYOND THE BANNER — UNLEASHING THE POWER OF DIGITAL TO DRIVE TOPLINE GROWTH

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There are plenty of other examples of companies launching

new virtual or cloud-based business models. Microsoft, reacting

to the market’s move away from boxed software, launched

Office 365, the cloud-based version of its dominant office suite,

available on a subscription basis. In a completely different

category, Gourmet magazine was shuttered as a print magazine

but resurrected as an online-only publisher — a fundamentally

different business model for parent company Condé Nast.

And in the world of financial services, H&R Block has found

value in monetizing free online tax prep services, which, despite

living under the same brand umbrella, involves digital skills

and tactics that are quite different from the company’s traditional

brick-and-mortar business.4

Finally, it’s worth remembering a “classic” example of digital

business innovation: Gap Inc.’s creation of the Piperlime

brand in 2006, as an online-only shoe retailer. While not

a primary revenue engine for the parent company, the Piperlime

experiment was deemed successful enough to remain a separate

branded entity, and has grown beyond shoes to include branded

women’s apparel and accessories and, as of this summer,

menswear as well. It was also no doubt a key reference point

in Gap Inc.’s decision to purchase Athleta (another online-

only retailer) in 2008.5 We view this as a model for successful

experimentation with online-only business models and digital-

only brands, and are aware of similar trial ventures in the works

within the retail sector and others.

For companies willing to experiment in this way, we see

significant potential to create new profit centers. Of course,

we also recommend that these initiatives be managed closely

and nurtured carefully, as beta is high. Of the three digital

growth strategies presented here, this “new business” category

typically carries the highest risk, as well as the highest

potential reward.

4 H&R Block 2010 Annual Report, page 4.5 “Piperlime Brand Adding Zest to Gap,” Marketwatch.com, September 17, 2010, http://www.marketwatch.com/

story/piperlime-brand-adding-zest-to-gap-2010-09-17.

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56

Getting started

If you’re now sold on the power of digital as a driver of growth

outside your current core, here are some general recommendations

to keep in mind as you’re plotting strategy and laying the foundation:

LOOK AROUND. Given the rampant, technology-driven innovation

happening across industries, you’ll want to keep an eye (or

several) on developments outside your own category — as well

as a constant focus on the ever-changing technology landscape.

Network with colleagues, partners, and functional peers to get

real-time insight into what’s working now, across many types

of organizations. This kind of insight should help drive shorter

cycles and higher hit rates for innovation initiatives and other

kinds of change programs.

LOOK AHEAD. When it comes to both business strategy and

technology, evaluating the current landscape is rarely sufficient

to inform plans and roadmaps with a time horizon longer than

six months. It’s essential to take a longer view, and include not

just competitors but also disruptive factors — which, defined

broadly, should include technology-driven substitutes as well

as potential new entrants.

LOOK WITHIN. Take a fresh look (or ask a genuine outsider) to

help identify “buried treasure” within your current business —

underleveraged assets that digital technology can help unleash

in unexpected ways. This could include products (lesser-known

SKUs, niche offerings, an extended “long tail” assortment),

processes (ancillary services, product development or innovation

capabilities, insight generation), people (internal experts and

influencers, underexploited partnerships, underserved customers,

etc.), IP (contents, patents, other forms of internal knowledge)

and who knows what else. New, unexpected connections

between assets and markets are often areas where digital

can help unlock additional business value.

PARTNER EARLY AND OFTEN. No single team or company can do

everything well, all the time. To build new capabilities quickly

and share risk, look within and across industries to find

unexpected partnerships that unlock new value by creating

entirely new value propositions. By partnering with companies

in adjacent — or even seemingly unrelated — industries you

may gain access to new pools of assets such as content,

technology, or data (always fulfilling commitments to protect

consumer privacy, of course). These can help power new kinds

of digital experiences — or even full-fledged new ventures —

while leveraging your own internal assets and capabilities in

more productive ways.

CONSIDER BUYING. Sometimes it just makes more sense to

purchase assets, capabilities and talent outright, rather than

partner. (Allstate’s pending acquisition of Esurance, as of August

2011, is a particularly good example of this as it applies to

digital strategy.) Establishing a solid strategic foundation, with

a shared internal vision and a clear view of your desired future

state, can help reveal your most critical current gaps and aid

in evaluating possible acquisition targets for digital initiatives.

Hopefully we’ve convinced you that “digital” is much more than

your Web sites, banner ads, search keywords and mobile apps.

At its core, it is technology-enabled growth, innovation and

transformation of existing business models. As the other articles

in this report make clear, we believe the next major cycle of

technology-driven disruption has only just begun. And the future

belongs to those companies who look beyond the importance

of near-term optimization — as important as that is — and move

decisively to put digital at the center of their strategies for long-

term business growth and differentiation.

BEYOND THE BANNER — UNLEASHING THE POWER OF DIGITAL TO DRIVE TOPLINE GROWTH

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Digital” can be more than a marketing or sales channel — it can fundamentally transform a product or service.

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The Rules of GamificationGaming is embedded in us as human beings. We’ve already seen the effects of applying game mechanics to individual marketing campaigns, to every loyalty program in existence, and to tons of Web sites where you might not think “game” at first glance. This is “gamification,” and to make it work, there needs to be a focus on the very human benefits that make games successful: challenge, recognition, tracking, competition and cooperation.

Human beings love games. If you look hard enough, you’ll find game dynamics

in everything we do, from education to careers to relationships. We’re all about

establishing rules, defining winners and losers, competing and cooperating.

So while it’s no surprise we see all of these things in marketing campaigns, it’s

also nothing new. For decades, loyalty campaigns that instill customer loyalty

by awarding points and prizes have been a mainstay of establishing customer

relationships. Now the rise of social media is bringing a different kind

of gamesmanship to bear. Facebook is flooded with FarmVille and Mafia Wars

achievement. Foursquare is turning everyone into the mayor of somewhere.

And Twitter, though most are loath to admit it, is all about the accumulation

of followers. Then there’s Klout, which has managed to make a game of all

these games, awarding badges and small gifts to those who are best at playing

the social game.

Brands want to play, too. And some are doing a good job of it. Pepsi, Starbucks,

Hallmark and Nike are just a few examples of marketers who have gamified

their customer experiences. “Gamification” — the application of gaming

principles, mechanics or concepts to efforts that aren’t necessarily “games,”

has everyone talking.

OUTLOOK REPORT | VOL 10

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60

But games aren’t all fun and, um, games. While they might appear

to be a safe way to earn engagement for your brand, they must

be integrated in an authentic way in order for consumers to want

to participate. When considering the prospect of a program

using these principles, it’s important to focus on very human

benefits that make games successful — challenge, recognition,

tracking, competition and cooperation.

These five benefits are the lenses through which we’re approaching

any gamification effort:

As marketers, we’ve been taught to make communication

frictionless, easy and direct. But for games, that’s a recipe for

boring. The artful application of difficulty to games is what makes

them fun, and there exists the same opportunity to create fun

in marketing using this principle. Don’t be afraid to challenge

your audience but, of course, that’s not the same as miring

them in complexity.

A lot of people go through life without being recognized very

often — that’s one of the reasons we have birthdays and

Facebook. Games can change that. They recognize achievement,

scarcity and excellence in a context that matters to the player.

Taking that understanding of context and what truly matters

to a consumer creates a flood of creative marketing ideas.

Badges, mayorships, little gifts — they can all go a long way

to make your consumers feel special.

The notion of the Quantified Self has taken deep root in our

culture. We’re tracking more and more of our lives via sensors,

apps and Web sites than ever before. Our workflows, diets

and sleep schedules are all now quantifiable using the latest

technology, but games have a long history of giving players

feedback about their progress and when they’ll finally reach

THE RULES OF GAMIFICATION

1. CHALLENGE

2. RECOGNITION

3. TRACKING

We humans are all about establishing rules, defining winners and losers,

competing and cooperating.

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61OUTLOOK REPORT | VOL 10

the end. It’s easier than ever before to harness data to enrich

any experience and deepen the engagement one has with it, be

it entertainment or marketing — or both. Using games can help

you help your consumers better understand their performance

and help them improve.

This is the most obvious lens to consider when applying game

thinking, because games produce winners, losers and everything

in between. The rub with marketing is making sure that the

audience cares enough and that there are enough relevant

rewards to warrant real competition.

Throw “teams” into a competition and all of a sudden everything

is more intense. As much as people like to compete, they like

to achieve things together even more, and social games have

taught us lessons about that fact for several years now. Marketers

offer things consumers want — making them participants in

a gaming experience, and encouraging them to work together

toward those wants can be a powerful motivator.

Together, these five lenses create some really interesting programs.

We’re using them to bring lively connections to family dinners

(www.eltacodor.com), create hunts across America for hidden

prizes (www.thanksabilliongiveaway.com) and power a Twitter-

fueled race to the Super Bowl (awardshowsubmission.com/

mercedesbenz/tweetrace/the_race.html). Beyond marketing,

businesses are using these lenses to aid them in everything

from training to customer service to logistics.

Can gamification get in the way? Of course. But it can also

be a profound tool in the marketer’s toolbox. Consider adding

game design to the marketing skill set — and treat it like

creativity, flexibility, tenacity and any other must-have

in the marketing superpower set. Applying what we’ve learned

from games to advertising creative, the tracking of marketing

efforts and the brand itself is interesting. If it’s also fun, then

it becomes very interesting.

4. COMPETITION

5. COOPERATION

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It’s Not Enough to Be Liked — Getting Serious About Socialwill be using social media in some way by next year. (80 percent already do.) But according to a recent PRWeek report, more than a third of all companies don’t have a point person responsible for social media within their organizations, let alone the commitment that calls for more than a solitary person for social media. We’ve outlined three areas of focus around strategic social media for marketing organizations, some immediate ways to get there and how to integrate agencies with an in-­house staff.

All CMOs want the same thing: to make their organizations much more customer-

centric rather than focused on products and channels. But to embrace the

customer today means getting much more serious about social media. As we

continue to see, social media transforms not only the way brands communicate,

but also encompasses other marketing functions including customer service,

research, social databasing and product development.

Social media continues to rapidly evolve. We know from eMarketer that nearly 90

percent of U.S. companies will be using social media in some way by next year.

(80 percent already do.)1 But according to a recent PRWeek report, more than

a third of all companies don’t have a point person responsible for social media

within their organization, let alone the commitment that calls for more than

Chris Bowler VP, Social Media

@BUCKETQUIZ

OUTLOOK REPORT | VOL 10

1 “Social Media Survey 2010,” PRWeek, September 1, 2010, http://www.prweekus.com/pages/login.aspx?returl=/social-media-survey-2010-the-social-connection/article/177511/&pagetypeid=28&articleid=177511&accesslevel=2&expireddays=0&accessAndPrice=0.

WRITTEN BY

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64

a single person to manage social media. The reality is that many

companies are still experimenting and delegating social media

to junior staff and a patchwork of agencies. That has to change

if brands are going to take full advantage of the power of

social media.

Here are three areas of focus on strategic social media for

marketing organizations, some immediate ways to get there

and how to integrate agencies with an in-house staff.

1. EMBRACE YOUR NEW STRATEGIC ASSET — A FACEBOOK

BRAND COMMUNITY

The last few years of social media activity has rightly centered

on Facebook, the largest platform. We’ve progressed from

the creation of brand pages as an experiment and come to

the understanding that today these pages are strategic assets

in the form of large-scale communities. Among the top 100

brands today, the average fan base amounts to over 7,000,000

“likers,” which is something truly remarkable in such a short

time.2 And while fan count isn’t the best gauge of an effective

social media program, it offers a great head start for a brand

to activate this new strategic asset.

Consider how shabbily most brands organize around this

asset. Many outsource this increasingly important platform

to an outside agency. And it’s not just Facebook. Management

of Twitter profiles and YouTube channels are also being

outsourced. What should be a core in-house function,

is relegated to the periphery, with only half-measures to deal

with ongoing customer service, fan activation and ultimately

product and service innovation through community co-creation.

Of course, many brands find an agency to offer these services

because the brand can’t staff these social media channels

properly. According to Forrester, more than 50 percent of

companies say they lack the people on their teams to manage

channels in the social space.3 And agencies are all too eager

2 “PageData,” Inside Network, August 2011, http://pagedata.appdata.com/.3 Sean Corcoran and Christine Spivey Overby, June 2, 2011, “Accelerating Your Social Maturity,” Forrester,

http://www.forrester.com/rb/Research/accelerating_social_maturity/q/id/59690/t/2#figure3.

of companies say they lack the people on their teams to manage channels in the social space.

OVER

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65OUTLOOK REPORT | VOL 10

to sell-in another service offering. (Full disclosure: Razorfish

provides community management services and currently

manages several types of social media platforms on behalf of

our clients.) But the nature of this outsourcing needs to evolve.

Philosophically, a brand should manage its own community —

providing transparency and authenticity to its customer base,

as well as operational efficiency. Agency community managers

can get in the way, creating a barrier between the brand and

its customer.

It’s not as difficult today for an organization to hire seasoned

community managers as it may have been just a few years back.

We are seeing resumes from candidates who manage social

media channels for small companies now looking to step up

to bigger brands. Posting an opening on Monster or Mashable

is often a way to get things started. The big decision in hiring

the right resource centers around a candidate’s ability to blog/

post/tweet in the right social voice for the brand — this skill is

an art, not a science, and shouldn’t tilt all the way to an overly

polished and copy-written approach.

Another consideration is where within the organization these

resources should reside. We see lots of different configurations

here. To be truly serious about social media, we advocate dedicated

roles, starting within the marketing team, for community managers.

DeVry University, a client, has created a successful model where

three community managers — each aligned to key audiences

of students, alumni and prospects — reside within the marketing

department and report up to a director of social media.

Even though an organization may have an in-house social

media team, an agency still has an important role to play.

But this role should be strategic and creative, acting behind

the scenes as a force multiplier, rather than replacement for

a brand’s direct participation.

Here are some key ways in which an agency can shift from tactical

community management to strategic community development:

STRATEGIC ACTIVATION. By representing the consumer, the agency

is in an ideal position to define the role that social media can play

for the client’s brand and business. This process gets beyond

using Facebook as a channel for communication, where content

and interaction is aimlessly posted and fan accumulation becomes

the mere end goal. The real purpose is to identify and develop

the unifying concept for why a consumer should and would

interact with the brand in a social way. Sometimes this is obvious,

especially for high-interest brands, but it’s much more challenging

for Consumer Packaged Goods (CPG) brands where getting

beyond the product is essential for true success. And typically

this approach not only defines a brand’s social media efforts,

but also their digital marketing efforts as a whole.

OPPORTUNISTIC OVERSIGHT. While brands should focus on

ongoing community management, the agency shadows the

brand team looking for strategic and tactical opportunities

to add value to the conversation and content. Taking advantage

of in-the-moment opportunities, such as a brand mention by

a celebrity on Twitter or a relevant video that’s getting traction

on YouTube, are a few examples where agency resources

should provide another set of eyes and ears for the brand team.

A framework for this “and pounce” approach can easily be set

up immediately.

2. INFUSE SOCIAL RESEARCH INTO THE MARKETING ORGANIZATION

The social research space is still in its infancy, but brands

need to rapidly infuse the various elements of social media

intelligence into their marketing and business process.

Let’s start with listening. While conversational monitoring

around a brand’s products and competition is standard

operating procedure, true listening hasn’t impacted most

organizations yet. At Razorfish, we are testing listening research

to inform a number of different types of marketing functions.

Take media planning, for example. While the traditional

approach to developing a media plan is first to analyze how

a specific audience can be targeted across a range of media

options — including TV programming, print vehicle and digital

channels — listening research provides a whole new approach.

Armed with listening data, the media planner can determine

where conversations around an industry category is taking

place, and therefore where a paid message may find more

receptivity, or where launching a social media program might

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66

spur engagement for the brand. For Best Buy, social listening

techniques were used to identify partnership opportunities

in the gaming space such as Comic-Con. Razorfish gathered

insight around hardcore gamers — determining what events

and game titles drove the largest spikes in relevant discussion.

By partnering with such events, Best Buy was able to create

brand affiliation with gamers and generate authentic gaming

content that could then be redistributed through earned

and paid channels.

Another way we are testing listening research is rapid insight

development. A recent poll conducted on one of our client’s

Facebook pages yielded more than 1,000 comments in less

than 24 hours. These comments provided a wealth of insight

into how customers use this product, which strategists and

planners can use to inform future marketing programs and

even product innovation. We know we’ll see rapid insight

development evolve into research dashboards, piping this

real-time information directly to the planning and strategy

teams and allowing follow-up questions back to the community.

How to make this happen in your organization? Here are some

key ways in which social research can be infused into the

marketing process quickly:

START WITH A BASIC LISTENING AUDIT. This can be a brief report

that determines who is talking about your brand, category and

competitors over a short look-back window of, say, three months

to a year, in order to capture seasonality of conversation. This

isn’t rocket science, rather a tried and true way to get grounded

in the conversation. Even for socially established brands, ask

yourself: When was the last time you conducted a point-in-time

listening audit?

USE A HYBRID APPROACH TO LISTENING. The growing need for

conversation monitoring measurement and mining has led to

a flurry of new social listening tools, many of which have very

unique capabilities. For example, Radian6 has access to one

of the largest data pools and satisfies monitoring requirements,

but NetBase takes a conversation quality approach and uses

natural language processing to identify key themes and categorize

sentiment. However, neither tool is effective without the analysis

of a subject matter expert. The most important tool when trying

to distill millions of pieces of social conversations is a pair of

human eyes. We recommend taking a hybrid approach to social

listening by choosing tools like NetBase, which can categorize

content by sentiment and discussion theme, while also employing

an analyst who is immersed in the brand to put the findings

into context.

Which is worse: a brand starting out with few fans and followers, or a brand with

millions who are treated as if they are indistinguishable from one another?

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ANALYZE FACEBOOK INSIGHTS. Compare Facebook to your other

communication channels and you might find that your fans

are different than the consumers you think you’re targeting.

And then solve for why. For a Kellogg Company brand, we

discovered that the audience the brand wanted to target —

men, ages 18-24 — was very different from the fans of their

Facebook page, which was skewing 90 percent female. This

naturally leads to a shift in social voice and content creation.

3. GET ON THE PATH TO TRUE SOCIAL INFLUENCE MARKETING

Day by day, brands continue to fine-tune ways to engage their

customers in the social space. But too often this process involves

throwing content against the proverbial wall, and just seeing

what sticks. Even when the best social editorial calendars

are developed and deployed, we still aren’t starting from

a place of strategic insight and personalized engagement.

However, it’s not as if brands aren’t successful with this

generalist approach — they continue to grow their fan base.

Ask yourself which is worse: a brand starting out with few fans

and followers, or a brand with millions of fans that are treated

as if they are indistinguishable from one another?

What’s missing is an understanding of the customer’s needs,

why they became and continue to be a fan of the brand and

how they influence one another. This is as simple as social

personification. Armed with this information, brands can tailor

their interaction more specifically. Yes, it’s difficult to segment

today, but this is going to change as social networks evolve.

Case in point: Google+ and its model of Circles. Over time,

this characterization of a person’s social relationships may allow

a closer, more personalized interaction between customers

and brands as well. We aren’t there yet, but the concept behind

Circles is our future.

Waiting around the corner, then, is greater intelligence on

a brand’s social graph, which quickly leads to an understanding

of what the most important influencers are. More importantly,

we will be able to have granularity around influencers in

a segmented way. For example, we will have ways to activate

the “deal-seeking influencers” looking to make noise about

a promotion, or the “category enthusiast” influencers, hungry

for new product news and willing to share it with their circle.

How to start down this path for your organization? Here are

some key first steps:

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68

FAN CATEGORIZATION. At a basic level, this is about how

a customer wants to interact with a brand in social media.

Do they want help with customer service issues, receive product

information or get special offers? Start by stepping back

and look at customer behaviors that inform how to structure

community content. A great first step might be to assess user

posts and comments and categorize them by interest. Next,

design polls to further gauge areas of interest to the fan base.

SMART DATA COLLECTION. Another way to understand your fan

base is to ask for user data when appropriate. Signing up to

receive special offers or exclusive content is a no-brainer, but

it’s surprising how many brands don’t take advantage of this

opportunity. By providing different opportunities to collect

an email address, users begin to self-categorize by interest.

Having opted-in to a particular interest — for example, new

product information — you can now deliver more relevant

communications. In turn, as users talk and share this information

across their social networks, you have the beginnings of a

tagged influencer database.

GET FAMILIAR WITH GOOGLE+. While user adoption and usage

is still an issue, Google is re-architecting how we group our

friends and colleagues through Circles. If you haven’t tried

it yet, give it a test run.

Three listening tools to watch:

NETBASE: Best-in-class natural language processing that

helps categorize sentiment by theme and intensity.

EVOLVE24: Strong social listening capabilities — large data

pool, topic categorization, trend analysis and the ability

to merge digital and traditional media data, which is a very

unique feature.

SENTIMENT 360: Semantic AI-based sentiment analysis

that provides a high degree of accuracy (industry leader),

while also automatically ranking content for relevance

and conversation type.

IT’S NOT ENOUGH TO BE LIKED — GETTING SERIOUS ABOUT SOCIAL

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WRITTEN BY

Jonathan Hull VP, Emerging Experiences

@HULLJON

OUTLOOK REPORT | VOL 10

Controlling the Retail Environment Through Digital Brand ImmersionAlthough touch screens have dramatically altered consumer expectations, retailers have mostly struggled to deploy innovative digital experiences at scale beyond basic store navigation or the occasional integration of tablets. In a world where everything is increasingly available everywhere, wowing customers to drive sales is more important than ever. As a result, innovative digital experiences are increasingly challenged to move from the lab or the presentation deck to the sales floor. We have identified five factors to drive implementation and move from prototype to improved customer experience.

Retailers have lost control of their stores. For that, you can blame the smartphone.

The proliferation of the iPhone and Android-based devices has dramatically altered

consumer expectations and behaviors. Life is increasingly lived online and mobile

devices act as always-there, always-on valets. In just about any environment,

people want to be online — communicating, sharing and researching. This is

especially true in stores, where consumers can use their mobile Web browsers

and apps to compare prices and products across retailers. When threatened

with commoditization, retailers see their margins come under pressure from being

the lowest price option or price matching. And what’s strange is that the store

owners are letting this happen by not giving shoppers the digital experiences

they so clearly want. Some of the more progressive retailers and brands have tried

to regain some control and become more digitally interactive in-store. However,

in talking with our retail clients, they often cite past failures and/or implementation

constraints as primary reasons why they haven’t made much progress.

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A big distraction that keeps some retailers from making progress

is their Apple Store envy. Almost every retailer we’ve worked

with cites the Apple Store as best-in-class, the benchmark for

what they aspire to be. This is a head scratcher. While there’s

no doubting that the Apple Store model gets many things right,

it also has its shortcomings — There are no immersive digital

experiences in the Apple Store. Customers interact directly with

the products, which is good, but there’s no way to compare

Apple computers to PCs. There is no way to digitally configure

and personalize products, and no articulation of the Apple value

proposition or how Apple makes your life better. This leads

many retailers to conclude, “If Apple doesn’t feel immersive

digitally in-store then why should we?”

So how does Apple get away with this? Because they’re Apple.

Cupertino has several advantages over the average retailer:

strong brand affinity, sexy product lines, knowledgeable,

enthusiastic and digitally-enabled sales associates and strong

customer support. The cold, hard truth is that the vast majority

of retailers can never be like the Apple Store. But retailers can

deploy immersive digital experiences to inspire customers,

elevate their products and educate consumers. Wannabes

need to forget the Apple Store and create their own digital

retail identity.

To help get there, we’ve identified five factors for driving adoption

and dealing with implementation constraints while creating what

we call the “brand wow effect” within the retail environment.

1. LEVERAGE THE PHYSICAL

For retailers, brick-and-mortar stores still have two big advantages:

physical space and sales staff. Physical stores offer a huge

home-field advantage and, even though consumers are more

informed and digitally connected, they still seek out the in-store

shopping experience. Why? Because there’s no better way

to tangibly experience a product prior to purchase. There’s

also social and entertainment value that consumers place

on shopping experiences. So retailers should look to digitally

enhance, not replace, the shopping experience.

For brands, differentiation is difficult when similar products

are compared side by side. Immersive digital experiences are

a great tool for educating consumers on the value proposition

of products as well as cross-selling accessories. We have

observed that digital experiences can lead to an 11 percent

increase in the average basket and a 20 percent increase

in accessory sales.

CONTROLLING THE RETAIL ENVIRONMENT THROUGH DIGITAL BRAND IMMERSION

To be successful, retailers and brands must value the creation of an experience over the enabling of technologies.

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One of the best uses of immersive digital in-store is to serve

the demand for personalization. Consumers want configurable,

personalized products but they struggle with complex buying

decisions. Interactive touchscreens and gestural experiences

are excellent for providing customers with the ability to configure

and personalize products to fit their needs. That’s something

smartphones don’t do well. These experiences create a deeper

affinity for a retailer or brand, leading to up to a 10 percent

increase in customer satisfaction.

One of the biggest myths about immersive digital in-store is that

it’s focused on self service. Actually, the opposite is the case

in the retail world. Retailers in general are not looking to add

staff, but almost every retailer is looking to make their sales

associates more effective. Burberry has equipped associates

in China with iPads to provide better access to online and offline

inventories, while JCPenney has done the same to assist with

complicated bridal jewelry purchases.

Whether it be arming sales associates with tablets or providing

touchscreens for consumers to co-experience, the results have

averaged a 4 percent increase in sales associate satisfaction

and less turnover. According to Deloitte, retail leads all industries

in adopting tablets. Their study predicts that 25 percent of all

tablet computers will be bought by businesses this year and

the number will continue to rise.1

2. VALUE THE EXPERIENCE OVER THE TECHNOLOGY

It’s the customer experience — not the technology — that

makes the difference. Customers shop in stores for reasons

ranging from pure utility to entertainment. Customers shopping

out of necessity don’t care about technology, they just want the

experience to be easy. Customers shopping for entertainment

are seeking pleasure, and technology must enable that

experience. A retail experience done right is an experience

that takes advantage of ubiquitous computing; where technology

fits into the human environment instead of humans being forced

to use technology. Put another way, it’s when consumers know

they’re engaging in an experience as opposed to experiencing

a technology — a key to driving adoption. It’s surprising how

many companies get this wrong.

A good history lesson in getting it wrong is the failure of the

first-generation kiosk, one of the most cited reasons why retailers

that have failed at digital in-store are reluctant to do it again.

Most kiosks were simply an idea the online channel teams —

not the retail teams — dreamt up to gain a Web site presence

in stores. The draw of easy implementation and the repurposing

of the online investment was irresistible. So they packed their

stores with cheap kiosks made of pressboard and Formica

that were outfitted with a browser-equipped PC, a low-res CRT

monitor, mouse and keyboard. Then, they waited for the orders

to flow in. They’re still waiting.

Why did they fail? Customers didn’t use them. Why didn’t

customers use them? Because the experiences sucked. Lesson

learned, successful implementations of technology do not

determine success — customer adoption determines success.

Many retailers never stopped to wonder why a customer would

stand in front of a Web site in a store when they could surf the

Internet from the comfort and privacy of their own home. They

ignored the fact that the retail experience is unique and special.

There are specific reasons why customers are there in the first

place. The chief result was thousands of ugly kiosks sitting

in the corner unplugged and collecting dust.

To be successful, retailers and brands must value the creation

of an experience over the enabling of technologies. Even today,

there is a wide disparity between retail technology spend and

experience spend. Large retailers and brands budget tens of

millions of dollars on hardware and technology to outfit their

stores, but only spend tens of thousands of dollars on the

experiences. Since adoption is the primary key to success,

the imbalance between technology and experience budgets

must shift. Customers don’t care what technology is under

the covers. If an experience provides value, they’ll adopt

1 Jeffrey Grau, “How the iPad is Transforming Retail,” eMarketer, May 1, 2011.

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74

it. According to eMarketer, “Retailers are looking to digital

technology to help influence consumer decisions at the shelf

level, while also aiming to streamline and ease the shopping

process. Consumers are also receptive to digital technologies

deployed in-store when they receive a tangible benefit.”2

3. BE AS COOL AS (IF NOT COOLER THAN) A SMARTPHONE

These days, digital in-store has to be at least as cool as the

device your customers are carrying in their purse or pocket.

This might seem contrary to the statement above; valuing

experience over technology. On the contrary, it’s not what the

technology is or how it works; it’s what the technology does.

The smartphone does a hell of a lot for a device that costs

a few hundred bucks. It’s a portable communication device,

data store and entertainment platform with tons of utility.

So why not just enable mobile apps in stores? Because customers

did not go to the store to use their mobile phones. They’re there

to shop and experience shopping. Digital needs to complement

and enhance the retail shopping experience, and to do so

effectively, it needs to be more immersive and more engaging

than your customer’s mobile device.

Size does matter — attraction and engagement are more keys to

adoption. Big, high-definition digital displays are hard to ignore

but they must enable an experience that helps customers connect

with a brand. For example, JCPenney’s in-store deployment of its

Findmore smart fixture experience inspires customers to digitally

shop by look — leveraging a 42” high-resolution touchscreen,

rich content and an extended online and offline assortment.

Immersive digital experiences have a 53 percent higher attraction

rate over traditional digital signage. To be clear, we’re talking

about inspiring customers in order to drive sales, not servicing

customers like they’re at an ATM. (That said, it’s worth noting

that digital is great for servicing customers as long as the

experience is private and optimized for the relevant task at hand.)

For driving sales, it’s all about digital experiences that attract

and engage customers. However, that’s not to say every retailer

needs to panel the walls with HDTVs. First, focus on getting

the experience right: Immersive digital experiences need to

2 Tobi Elkin, “Shopper Marketing Insight: Embracing Digital Touchpoints,” eMarketer, January 7, 2011.

CONTROLLING THE RETAIL ENVIRONMENT THROUGH DIGITAL BRAND IMMERSION

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75OUTLOOK REPORT | VOL 10

be discoverable and unfold through rich and pleasurable paths.

Then, test and measure different form factors to see what produces

the highest payback.

4. HIGH TECH IS NOT ALWAYS GOOD TECH

Another often-cited reason why brands and retailers don’t have

immersive digital experiences in-store is due to IT infrastructure

limitations. Every business wants an elegant, service-oriented

IT infrastructure where all data is available in real-time but few

have it. The digital ecosystem is changing too quickly to wait

for IT to get their ducks in a row. To make progress quickly in

the digital space, companies need to embrace some oldie-but-

goodie, low-tech solutions and leverage cloud computing.

One of the most low-tech, yet innovative, approaches to system

integration came from a large retail telecommunications brand

that recently went through a major acquisition. The IT integration

price tag of enabling every digital order to seamlessly flow

through the system was $125 million. A quick cost-benefit

analysis showed that it was much less expensive to hire staff

to manually process digital orders that fall out of the system

over a 10-year period. The process is nicknamed “swivel-chair,”

referring to how an associate pulls an order exception off

a printer, then swivels their chair to manually enter the order

into a couple of other systems. In today’s IT world, this old-

school approach is cost effective, if not innovative.

Cloud computing also offers an IT shortcut in many situations.

In the past year, Razorfish leveraged the cloud to successfully

launch 5,000 Windows Phone 7 touchscreens into the global

retail market in eight countries and nine languages. Working

against severe retailer infrastructure constraints across the globe,

the solution hosted analytics and content management in the

cloud and the experience was deployed in a six-month period.

The moral of the story is that retailers shouldn’t be afraid to kick

the IT integration can down the road. The low-tech solution is

often the right one for businesses, and there are plenty that are

tried and true, from batch processing to manual intervention.

The only must-have system is a solid measurement framework

where performance and success is measured — and hosted

in the cloud, if necessary.

5. PILOT DON’T PROTOTYPE

The ideal approach to getting immersive digital experiences

into retail stores is to align against a well-defined, overarching

A big distraction that keeps some retailers from making progress

is their Apple Store envy.

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76

strategy or vision. Since the digital retail landscape is evolving

quickly, any vision needs to be mapped out quickly — a matter

of weeks, not months. However, the realities of the retail business

and the need to get something done quickly often outweigh

the luxury of developing an overarching strategy. We commonly

we hear from our retail clients:

“We want to get innovative ideas to market quickly.”

“What we need is a clickable prototype to show our

executives.”

“If the prototype is successful, we may get buy-in for

a large-scale rollout.”

It’s true that most of our clients need to introduce innovative

digital experiences into the market quickly, but it’s not true

that they need a prototype. What they need is a pilot.

Following a prototype methodology is the most time-consuming

and costly path for getting digital retail experiences to market.

Prototypes are usually exercises in technology and since they

never enter the market, there’s not a lot to learn and business

effectiveness is not measured. Another disadvantage of prototypes

is the risk of someone beating you to market. If you’re onto a good

idea, chances are someone else is too — probably a competitor.

Our point of view is that prototypes are only useful for proving

functionality that: 1) is absolutely critical to success and

2) carries a sufficient risk of failure. If neither of these are true,

Razorfish strongly advocates piloting over prototyping.

If the goal is to get something to market quickly, then you

should pilot. Don’t waste time and budget on a prototype.

Pilots carry higher upfront costs because the experiences must

be developed to the point where it starts and ends logically for

a customer. And pilots have to be fully tested. However,

only pilot experiences provide learnings from real customers

interacting in retail environments. The costs of pilots can

be limited by keeping the scope to core functionality and

a statistically significant number of stores. For example,

a 1,000-store retailer may be able to limit a pilot to only four

or five stores for six weeks and still provide sufficient learnings

in which broader conclusions can be drawn.

The Razorfish approach for getting immersive digital into retail

is to do so quickly, with the goal of learning and generating

buzz. Since it’s just a pilot, there’s no need to boil the ocean

right out of the gate. Keep the experiences concise and aligned

CONTROLLING THE RETAIL ENVIRONMENT THROUGH DIGITAL BRAND IMMERSION

If the goal is to get something into market quickly, then you

should pilot. Don’t waste time and budget on a prototype.

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77OUTLOOK REPORT | VOL 10

to key success metrics where performance is measured. Take a

low-tech, low-cost approach to integration and kick the systems

integration down the road. It’s usually much more cost effective

for a sales associate to manually update a few pilot experiences

via “sneakernet” for six weeks, than to integrate to retailer

back-end systems.

Dos Don’ts

Quickly pilot experiences in real stores with real customers.

Keep experiences focused and aligned against success metrics.

Wow customers with kick-­ass experiences better than what they can’t do on their smartphones.

Pursue low-­tech, low-­cost integration methods for pilot experiences.

Focus on the experience more than the technology.

Admire the Apple Store. Try to be the Apple Store.

Waste time with prototypes unless there’s a high risk that critical functionality won’t prove out.

Try to boil the ocean, solve every customer problem and answer every question in a single experience.

Overly rely on mobile or put the online experience in store as-­is.

Wait for IT or elegantly integrate with retail systems until a pilot proves out.

Confuse technical implementation success with overall success.

Dos and don’ts

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79OUTLOOK REPORT | VOL 10

Adam Heimlich VP, Search and

Performance Marketing

@ADAMHEIMLICH

OUTLOOK REPORT | VOL 10

Performance Marketing Must DieDigital technology has rendered the sales process transparent. Brands that can recognize this fact have an enormous opportunity. How the brand wants consumers to feel, what it wants shareholders to believe, the government to do, the news media to report — are all revealed in a single set of search results. To effectively sell within this churning ecosystem of overtly targeted and obviously unintended messages requires organizational confidence and openness. Methodically insulated from ideas and salesmanship, the performance marketer is positioned to distract organizations from the imminent threat of a revolution in consumer perception, caused by digital media.

Have you ever received an email offer that looked good until you searched

the name of the product? Ever visited the site of an iconic brand and found it

cheap? Have you seen a funny commercial from a company with an infuriating

online application process? Have you had trouble finding a brand on your mobile

browser because sales affiliates masquerade as it? Can you name a brand that

interacts in the same personality it broadcasts?

The source of all this dissonance: Digital technology has rendered the sales

process transparent.

Brands that can recognize this fact have an enormous opportunity, and no use

for what we call performance marketing, which refers to DR, search, display

advertising and social media. However, it actually describes a set of activities

inadvertently designed to deny the reality of a transparent sales process.

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80

The problem with the performance marketing organization is

its separation from the sales, service and merchandising teams —

which is to say, from everyone directly involved with customers

in any capacity. The performance marketing team is also

traditionally walled off from second-hand research into

customers and their preferences, which features insights

of value for creatives, whose task of connecting emotionally

is widely perceived to be the opposite of performance marketing.

Methodically insulated from ideas and salesmanship, the

performance marketer is positioned to distract organizations

from the imminent revolution in consumer perception caused

by digital media.

The reality

Today, everyone sees brands naked, except their marketing

executives, who praise the lavish new clothes of performance.

Sales transparency means the end of efficacious channel

marketing. The salient point of a channel is physical

confinement — as a metaphor for media, it makes as much

sense as “dialing” a phone. Because messages spill out

of their containers in a manner more un-channel-like than

previously imaginable, smart brands assume any consumer

might see any message, regardless of whether a message is

intended for them. These brands aspire to sell with nothing to

hide. The assumption behind performance marketing, in contrast,

is that inconsistent, inferior or irritating online communications

are no more dangerous than a bit of junk mail.

Brands that issue communications for specific purposes are,

in fact, mostly creating awareness — not of the brand’s “story”

but of its value, which tends to make for a more interesting

narrative. How the brand hopes consumers will feel, how it

actually regards them, what it wants shareholders to believe,

what it wants the government to do and what it wants the news

media to report are all are revealed in a single set of search

results. To effectively sell within this churning ecosystem of

overtly targeted and obviously unintended messages requires

organizational confidence and openness.

Performance marketing teams, on the other hand, sustain

antiquated beliefs in messaging and measurement, separate

from sales and service. They reenact a historical drama of

sequenced stimulus and response, pretending that their

audience is playing within the arbitrary rules they’ve created.

PERFORMANCE MARKETING MUST DIE

Introduce the right motivation, the right skills and the right process for media optimization.

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81OUTLOOK REPORT | VOL 10

The word “performance” itself accidentally attests to the

theatrical nature of digital media “roles.” The ostensible actor

is not prospects or customers, but a featureless outline of their

activity captured in data. It’s a shadow play, designed to fool

and delight a willing audience.

For example, every Razorfish client has goals around customer

acquisition and retention. But almost no Razorfish clients task

their performance teams with optimizing media toward these

goals, though the data is always accessible. Similarly, every

Razorfish client wants their Web site to engage visitors, yet

nearly all performance managers ignore their bounce rates.

And all performance clients want more digital sales, but none

try to discover the optimal context, sequence and content

of messages that lead to digital sales.

Brands’ willingness to buy into performance marketing despite

its inability to harness the power of digital gives the game away.

Their function is to keep the problem under the rug for now,

and to carry the blame for “underperformance” should a more

adaptive competitor enter the market.

The solution

Replacing performance marketing with something that can

impact the bottom line is a matter of three corrections: Introduce

the right motivation, the right skills and the right process for

media optimization.

Motivation can only come from the top. If the one or two leaders

responsible for all the customer interactions influenced by or

measured in digital media don’t acknowledge that transparency

makes performance counterproductive, no one can. That’s the

first step toward dismantling performance marketing’s regime

of specialized expertise and fragmented accountability.

To supply the right rationale, leadership must specify goals

for all media — paid, earned and owned, online and offline.

Note that a CMO’s request to assess how its various media

efforts function together cannot be met under existing corporate

structures. Generally, the performance team has broadly applicable

data, while its people function as a specialized machine focused

exclusively on online sales or some other isolated measure of

activity. Brand affinity, customer retention and creative teams’

ability to influence and persuade are optimized separately and

slowly, with data sets less fresh or actionable than what is

collected constantly through digital channels.

To retool the optimization process to account for all marketing

goals simultaneously, a CMO must task channel teams with

expressing shared goals in compatible — which usually

means chiefly digital — terms. That is, if reach is a proxy

for effectiveness, the effect should be validated. While paid

search collects sales, its brand impact can’t be ignored.

It may seem easier to manage against baseline costs and

conversions, but customers aren’t as numb as marketers

are to the sense that a company is chronically undervaluing

digital operations or brand building. They know when the

company Web site is useless, or they’re getting hit with 10

discount offers a day. Transparency means that biased or

arbitrary communication choices will play out in public. Without

consistency of measurement, there is no justification for valuing

any marketing action over any other. Additionally, there is no

basis for optimizing marketing actions in combination across

channels, which is how they are always experienced nowadays.

This requires big change. And there will be chafing.

A performance marketer veering away from the usual charade

is like a retail cashier reallocated to the sales floor, only worse.

Although no VP is responsible for addressing total brand

perception in a customer setting, brands’ service staffs effectively

have that job. Compare their qualifications for meeting customers

in their space to those of the performance marketer, whose

putative value is rarified “expertise” with spreadsheets

and software.

Implementing the right skills starts with a reassessment of

the value of quantitative experts to digital marketing efforts.

There is no doubt that data analysis and predictive modeling

are important. No less certain is that a feel for what’s

behind activity data and a knack for imagining scenarios not

explicitly supported by the numbers are also required for

media optimization. Many marketing organizations staff for

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82

targeted digital media as if its challenges were linear, and the

optimization process mechanical. Early successes in social

media have clarified how unspecialized and playful in its

approach even a very serious interactive brand should appear.

That comes from an appreciation for the softer side of digital.

Get started

A good place is to start is including people with sales and

creative experience on the optimization team. However, the

turning point in digital marketing skills correction comes from

leadership that is as engrossed in misses, as it is in hits.

Brands that want marketers to automatically deal out optimal

responses to customer actions task them with learning above all

else. It’s in the broad application of patterns of consumer action

to brand operations that marketing results can be dramatically

improved, so aspire to replace performers with teachers.

A necessary casualty of a shift from expert posturing to reflexive

learning should be in the performance marketer’s toolset. If the

performance data software is too old to support channel-

agnostic feedback for holistic optimization, it should probably

be scrapped. The good news is the replacement can be much

more user-friendly. Software built for performance marketers

tends to be opaque because performance marketing itself was

designed to deny visibility.

The right process for digital media optimization features universal

accessibility to data feedback and common knowledge of goals.

A marketing organization in which teams keep secrets from

each other is unlikely to optimize transparent communications.

On the other hand, shared responsibility for published results

sets good teachers free. Where goals are intertwined, such as

brand perception and retention, site engagement and product

awareness, or SEO rank and social campaign adoption,

collaboration is easily incentivized. Where interests compete,

such as share of voice versus lead conversion efficiency,

leadership must be accountable for balancing power, and for

trade-off decisions aligned with current business strategy.

Automatic optimization, far from a mechanical specialty,

is mostly engaged marketers entitled to act.

An organization so adapted to current media reality would find

it hard to ascertain where its digital optimization team begins

and ends. Like its customers, the marketing department

would be constantly aware of what it’s trying to do and why.

Competitors who place accountability for digital success

in a dungeon where no idea or insight can penetrate will start

to look shackled indeed.

PERFORMANCE MARKETING MUST DIE

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85OUTLOOK REPORT | VOL 10

Ken Hong Managing Director,

Razorfish China

LINKEDIN.COM/IN/KENLIZHOUHONG

William LidstoneExecutive VP,

Razorfish International

@WILLIAMLIDSTONE

OUTLOOK REPORT | VOL 10

Toward a New Global Digital Agency StructureWhile digital efforts are increasingly integrated into the core duties of global marketers, Razorfish has found marketing executives continuing to express a high degree of frustration with the number of partners and complexity associated with managing digital programs globally. Razorfish has identified the disadvantages of traditional models, driving factors that put those models under intense pressure and potential solutions to the problems, including the centers of excellence model.

Matching luggage might be a good travel strategy, but it comes up short as an

organizational principle for a global ad campaign. That desire to have all the

creative around the world look like it’s part of a set created in the same factory,

by the same designer, is an old one. And yet, it lingers as digital efforts are

increasingly integrated into the core duties of global marketers. The effect,

we’ve found, is that marketing executives are frustrated with the number of

partners needed to manage global, digital programs and the complexity it breeds.

Old structures created to localize traditional media like print and out-of-home

often create mediocre digital creative, inefficiency and quality control problems.

Clearly, a new model is needed. It has to be lean, yet with a big enough footprint

to ensure global brand consistency. And it needs to be efficiently organized so

it can deal with one of the biggest challenges facing digital advertising — global

scarcity of talent. We believe that the centers of excellence model that’s popping

up more and more is a viable replacement for the bloated structures of yesterday,

but before we get to that let’s examine the shortcomings of current models.

WITH CONTRIBUTOR

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86

global, digital executives to be assigned to local markets, or for

marketers in India to request an equivalent standard of digital

creativity and quality as they see in the U.S. or Europe.

3. HYBRID

When implemented well, the hybrid approach allows local

flexibility to react to local market needs, while maintaining

brand consistency and countering some of the redundancy that

comes with the purely local approach. However, the shortage

of experienced digital talent beyond the realm of production

is a real challenge for this model in many markets. As a result,

locally driven digital campaigns tend to be fairly tactical in

nature — particularly in emerging markets — and miss the

impact they could have by fully leveraging global digital

expertise to amplify the campaign.

These models are under intense pressure. First, there’s a shortage

of talent and diversity in local markets. Even in the most mature

markets where agencies not only compete against each other,

but with clients, media owners, start-ups, technology firms,

etc., the pool is dry. The challenge in emerging markets is even

more severe. In addition, the types of talents and skills that

are available in different markets can vary significantly. It doesn’t

Old models

There are three traditional models, each with major disadvantages:

1. GLOBAL CONTROL WITH LOCAL TRANSCREATION/LOCALIZATION

While this helps ensure brand and message consistency, it largely

ignores the often vastly different ways consumers engage via

digital channels in local markets — both in terms of content and

context. As a result, digital campaigns become less impactful

as they are rolled-out across geographies. For example, not

only will social media have a larger portion inside the marketing

mix in China, Western markets are not familiar with local social

media properties. A campaign cooked up in the U.S. or Europe

and then localized for China might not account for this.

2. FULL LOCAL LEADERSHIP

This clearly makes marketing programs more relevant in local

markets, but runs the risk of losing out on building a consistent

global brand experience, and it often leads to a high degree

of inefficiency due to duplicated efforts and investments. In

addition, the availability of digital talent varies between markets.

It is not uncommon, for example, for Russian brands to request

TOWARD A NEW GLOBAL DIGITAL AGENCY STRUCTURE

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87OUTLOOK REPORT | VOL 10

help that a broad spectrum of digital expertise is needed. The

fragmentation within the sector is enormous and, combined with

the speed of change in media, technology and consumer behavior,

is confronting marketers with a high degree of complexity.

Another challenge is finding the balance between commodity

services and true differentiating offer. Given digital’s relative

youth, marketers often struggle to draw the line between

technology/creative production and innovation. Finally, there

are vast differences by markets. The digital media diet, digital

media properties, technology adoption and content preferences

frequently vary by country and need to be factored into

campaign planning and execution.

A new model emerges

In response to the shortcoming of the traditional structures

and the challenges in designing and deploying impactful digital

programs, we see a new model emerging; a structure around

centers of excellence — such as emerging experiences, social

media, media creativity, analytics, etc. — often in support of the

hybrid model. In other words, a center of excellence as a unit

based on a clearly defined vision and goal, such as becoming

a market leader in cloud computing worldwide. There is no

fixed formula for how to set up such an entity and its size and

organizational structure will depend on the subject, the local/

regional market needs and its geographic scope.

Step one is to analyze existing talent in key markets so that

there’s a basis to extend and build from, and so that there’s

a well-respected leader to attract talent. Assess the availability

and diversity of talent in the respective local markets before

deciding on a hub location. Once the hub is established,

a concerted effort is needed to bundle activities there so as

not to undermine the efforts of building a scale in certain areas.

China is a good example. While it’s a well-known fact that

China lacks local, digital talent in general, thanks to its fast

growth and abundant opportunities, it has become a talent

magnet for the region. More and more talent from markets like

Hong Kong, Taiwan and Singapore are flowing into China and

making up an ever-increasing portion of the workforce. In fact,

the most successful marketers and agencies in China today

are those who can construct effective teams that consist

of talent from different markets in the region.

This approach allows agencies to attract specialized talent

at scale into core locations around the globe. These regional

Global hubs

Seattle London

Australia

Shanghai

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88

centers in turn partner closely with local market teams to design

and build breakthrough campaigns. It goes without saying that

local offices still need to employ key digital talent locally but it

alleviates (to some extent), the massive shortcomings in skilled

digital marketers and increases the ability to manage complexity.

The new digital model also builds on the learning that designing

and implementing global campaigns no longer mandates physical

presence in every single market; this is particularly true for tier-two

marketers. When Tourism New Zealand set out to launch its

digitally driven global marketing campaign, it initially engaged

multiple Razorfish offices to plan and execute the campaigns

in parallel. While they had great results in some markets, others

were more challenging. Throughout the process, several offices

emerged with strong and complimentary skills. We both realized

a “hub-n-spoke” model with distinct centers of excellence

probably made more sense. Working together, we established

hubs in Seattle, London and Shanghai to manage their global

campaign. Success no longer depends on the number of people

per market; having physical presence does not equal local, digital

skills. We have already seen improvements on multiple fronts like

communication efficiency and integrated campaign planning.

So next time when choosing a global digital agency partner,

remember to ask the following questions:

Where are your centers of excellence globally?

Why did you select those locations?

What talent and skills do you have in key local markets

and how do the centers partner with local offices?

How have you delivered digital innovation —

with positive impact to the bottom line — for clients?

What are examples of digital campaigns you executed

with significant impact on brand level metrics?

Regardless of what new approach wins, the increased spend

in digital, combined with ongoing shifts in the technology,

consumer, and media landscapes will likely lead to more

pressure on traditional models in the foreseeable future.

The jury is still out on the center of excellence model, but there

is increasing evidence that it’s an efficient way to manage

the complexities of a global campaign.

TOWARD A NEW GLOBAL DIGITAL AGENCY STRUCTURE

A new model is needed. It has to be lean, yet with a big enough footprint to ensure global brand consistency.

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91OUTLOOK REPORT | VOL 10

Paul Gelb VP, Mobile Practice

@PAULGELB

OUTLOOK REPORT | VOL 10

Limited Time to Prepare for Unlimited Potential of MobileMobile offers unprecedented reach to marketers, providing access to consumers anywhere and anytime. Mobile is now driving a pace of change that is so fast that projections beyond two years are so unreliable that they can only be considered conjecture. But make no mistake, mobile will one day surpass television’s ad spend. Marketers’ greatest challenge in this decade will be to prepare their companies for a shift in their business that is unparalleled in terms of speed and scale.

Mobile media has reached a crossroads reminiscent of Bill Gates’ famous insight

from 1996, “We always overestimate the change that will occur in the next two years

and underestimate the change that will occur in the next 10. Don’t let yourself be

lulled into inaction.” This trend was evident in the evolution of online media and

appears to be repeating itself with mobile. Unrealistic short-term expectations aren’t

met and that leads to dismissive attitudes and underinvestment in preparing for

significant long-term change. The unprecedented, dizzying pace of mobile technology

advancement and consumer adoption will make mobile the most disruptive mass

medium, with wide-ranging effects for both advertisers and consumers. Mobile’s

unique functionality creates the potential for more effective and efficient advertising

than ever before. Yet, marketers are still struggling to find operational models that

can execute effectively and efficiently across traditional media and online. In the face

of these difficulties, marketers must learn from the mistakes made a decade ago,

because future consequences will be more severe.

We believe that mobile spending will surpass not only Internet ad spending, but

also television, and have calculated a forecast for when this could occur based

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Page 92: Razorfish outlook report 2011 (vol10)

92

1 Horace Dediu, “More than 60 Apps Have been Downloaded for Every iOS Device Sold,” asymco.com, January, 16, 2011, http://www.asymco.com/2011/01/16/more-than-60-apps-have-been-downloaded-for-every-ios-device-sold/.

2 A.K. Palit, “Internet Ad Revenue Data Shows Signs of Re-Acceleration,” www.iab.net, April 13, 2011, http://www.greencrestcapital.com/blog/internet-ad-revenue-data-shows-signs-of-re-acceleration/.

LIMITED TIME TO PREPARE FOR UNLIMITED POTENTIAL OF MOBILE

on reasonable assumptions. Our analysis is described in detail

on page 97. The conservative estimate was 12 years and the

aggressive estimate was 10 years. However, we don’t believe

that identifying the date has any inherent value.

Mobile forecasts have consistently been unreliable and

underestimated. For example, in 2008, the projected number

of Apple mobile operating system (iOS) app downloads by 2010

was 200 million.1 However, the actual number of downloads

reached 14 billion, 70 times the amount forecasted just two

years earlier. The worst predictions are inaccurate predictions.

More importantly, it won’t matter if this transition occurs in 10

years or 20 years. Recommendations for individual clients have

never been contingent on mass adoption by the industry

at large. Our decision making process is consistently focused

on identifying the right opportunities, allocating optimal resources

and executing at a high level to generate the best measurable

return on investment. The greatest challenges in mobile have not

been related to decisions about if and when to invest in mobile.

Rather, our goals have been to enable clients to keep up with

rapid shifts in consumer behavior toward mobile usage.

If the pace of growth for the mobile channel is higher than

it was online, it is more important to determine how to be better

prepared this time to execute effectively and efficiently than

to focus on an arbitrary industry juncture.

Assessing comparable impact of Internet ad spend

One of the most important parts of preparing for change is

identifying what is different and what remains the same. Online

growth is a valuable base upon which to assess the potential

long-term impact of mobile. Any discussion about the real or

perceived impact of mobile must address skepticism of its

predecessor. Declarations in the late 90s that the Internet would

rapidly disrupt traditional media channels and capture their ad spend

are still considered by many marketers to have been unfounded.

However, after just 16 years, Internet ad revenue was $26 billion

in 2010. An apple to apples, inflation adjusted comparison shows

that in their sixteenth year, broadcast and cable only generated

$16 billion and $7 billion, respectively.2 In 2010 a more significant

INTERNETCABLEBROADCAST

$0

$3,000

$6,000

$9,000

$12,000

$15,000

$18,000

$21,000

$24,000

YEAR 1

$358

SOURCES: IAB INTERNET AD REVENUE REPORT, PRICEWATERHOUSECOOPERS LLP, UNIVERSAL MCCANN

$1,012$147 $295 $499 $745

$55 $267

YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8 YEAR 9 YEAR 10 YEAR 11 YEAR 12 YEAR 13 YEAR 14

Annual $ ad avenue growth — first 14 years

$1,190 $1,580 $1,853 $2,080$2,495 $3,180 $3,654 $4,059

$4,816$6,501

$2,162

$ M

ILLI

ON

S

$2,787$907 $1,920

$3,698

$5,030$6,557

$7,885$8,188 $8,859

$9,766 $10,870

$11,717

$13,259

$4,621

$8,087

$7,134$6,010

$7,267

$9,626

$12,542

$16,879

$21,206

$23,448

Page 93: Razorfish outlook report 2011 (vol10)

93OUTLOOK REPORT | VOL 10

milestone was reached. Internet ad revenue surpassed several

traditional media segments, including newspapers, magazines

and radio. It took more than 40 years for TV (broadcast and cable)

to surpass newspaper advertising revenue.3 (See chart at left.)

Its growth was as responsible for Internet’s rise in advertising

market share as the decline of other media channels. Ad spend

on local TV, syndicated TV, newspaper, magazine, radio and

directory decreased 35 percent, more than $43.8 billion, between

2000 and 2010.4 Newspaper advertising had a particularly sharp

decline, decreasing 54 percent in just five years. Much of the

investment in these traditional media channels has shifted to online

ad expenditures as well as digital marketing initiatives that aren’t

even included in ad spending figures like email marketing, digital

coupons or digital promotions. When these additional segments of

digital marketing are counted, online investment nearly mirrored the

decline of major traditional channels, totaling $47.6 billion in 2010.5

Despite significant growth in online ad spend, traditional media

will still account for an estimated 80 percent of advertising dollars

in 2011.6 Cable and network television were notable exceptions

to online’s disruption of traditional media. In 2010, TV captured

the largest ad spend market share — two times online’s market

share. Marketers that could not effectively shift budget to digital

retained traditional media channels alternatives. Consequently,

even though Internet accounted for 25.2 percent of adults’ daily

media consumption time in 2010, it received just 18.7 percent

of U.S. ad spending.7 However, the rate of ad spend shift

to digital is growing and TV has become increasingly vulnerable

to disruption. Estimated growth in 2011 for Internet advertising

is 20 percent compared to 4 percent for TV.8

Why mobile is different

By almost every metric, mobile outperforms online advertising.

Mobile will be the first truly mass media, offering unprecedented

reach efficiency to marketers. Advertisers can also generate

greater effectiveness from brand engagement and conversions.

The increased value of mobile for advertisers should lead to higher

growth rates and larger budget shifts from traditional media.

Mobile subscriber penetration is now 101 percent (average

person has more than one mobile phone) compared to 75

percent for Internet.9 Users are rapidly adopting smartphone

and tablet devices, which support consumption behavior and

ad formats required for significant ad spending. Apple’s iOS

devices have become the fastest adopted consumer electronics

products in history. By early 2012, there will be 54 million tablet

users and 50 percent of mobile subscribers will have smartphones

in the U.S.10 By 2014, the number of mobile Internet users is

3 Nieman Journalism Lab, http://www.niemanlab.org/2009/08/can-newspaper-publishers-survive-this-revenue-freefall-perhaps-if-they-embrace-a-digital-future/.

4 Harold L. Vogel, Entertainment Industry Economics, Cambridge University Press.5 Jack Myers Media Business Report 2020 Vision: Media, Advertising and Marketing Economic Health Report 2000-2020.6 Nicole Perrin, “Traditional Media: Dollars and Attention Shift to Digital,” eMarketer, May 18, 2011,

http://totalaccess.emarketer.com/Reports/Viewer.aspx?R=2000792.7 “Ad Dollars Still Not Following Online and Mobile Usage,” eMarketer, March 31, 2011, http://totalaccess.emarketer.com/Article.aspx?R

=1008311&dsNav=Ntk:basic|internet+25.2+adults%E2%80%99+daily+media+consumption+time+in+2010|1|,Rpp:50,Ro:-1. 8 “Comparative Estimates,” eMarketer, http://totalaccess.emarketer.com/EssentialMetrics.aspx.9 “Comparative Estimates,” eMarketer, http://totalaccess.emarketer.com/EssentialMetrics.aspx.10 “A Portrait of Today’s Tablet User,” Online Publishers Association (OPA), June 2011, http://onlinepubs.ehclients.com/images/pdf/

MMF-OPA_--_Portait_of_Todays_Tablet_User_--_Jun11_(Final-Public)3.pdf.

0%

25%

50%

75%

100%

Where subscribers frequently access Internet on their mobile device

From hom

e

89%

At w

ork

66%

In the car

66%

Outd

oors

69% In retail locations71%

Page 94: Razorfish outlook report 2011 (vol10)

94 LIMITED TIME TO PREPARE FOR UNLIMITED POTENTIAL OF MOBILE

projected to surpass desktop Internet users.11 Recently, several

carriers began offering smartphones for free with a two-year

contract, eliminating any price impact on the smartphone versus

feature phone purchase decision. Thus, smartphone growth

will continue, making the ownership of smartphones or tablets

nearly ubiquitous in the U.S.

Mobile offers unique access to consumers; capable of reaching

them anywhere and anytime. Subscribers frequently access

Internet on their mobile device from home (89 percent), at work

(66 percent), in the car (66 percent), outdoors (69 percent) and

in retail locations (71 percent). Smartphone users spend 100

minutes a day on mobile Web and apps, a 100 percent increase

since December 2010. Tablet usage varies, but a reasonable

estimate is two hours a day. Thus, mobile is rapidly approaching

two and a half hours of daily Internet usage.12 Mobile already

accounts for 20 percent of marketing emails opened in 2011

and is projected to generate 20 percent of searches in 2012.13

Mobile’s share of email and search should grow as smartphone

and tablet adoption increases.

Mobile devices also enable the addition of location targeting

to demographics, content and time of day. This creates the

opportunity to significantly increase contextual relevance with

dynamic ads. And touch screen interactivity provides a unique

and entertaining lean forward experience. Mobile outperforms

online across all of the major brand engagement metrics,

including ad awareness, aided awareness, unaided awareness,

message association, brand favorability and purchase intent.

The average click through rate on mobile ads is 8.7 times higher

than online advertisements.14

Assessing potential of budget shift from TV

Network and cable ad spend resiliency has not been based upon

their superior value for marketers. Rather, cable and broadcast

networks leveraged large audience inventory scarcity to generate

significantly higher prices. From 1980 to 2008 the average

number of households viewing TV per minute decreased 71

percent while the CPM increased 692 percent, according

to Nielsen. TV achieved this unique advertising paradox by

reducing lower paying advertiser categories through attrition and

increasing the share of revenues from higher paying advertisers.

The remaining advertisers place a considerable value on being

able to reach a broad national audience in a time sensitive manner.

* DELTA DEFINED AS A POINT DIFFERENCE IN EXPOSED VS. CONTROL GROUPS

SOURCE: INSIGHTEXPRESS, “MOBILE INSIGHTNORMS,” JAN. 7, 2011

Mobile and online advertising’s effect on brand

238

14

11

8

8

8

4

3

4

3

3

Message association

Purchase intent

Aided awareness

Brand favorability

11 “Internet Trends,” Morgan Stanley, April 12, 2010.12 “Mobile Apps Put the Web in Their Rear-View Mirror,” Flurry, June 20, 2011, http://blog.flurry.com/

bid/63907/Mobile-Apps-Put-the-Web-in-Their-Rear-view-Mirror.13 “Jack Myers Video Report: $54 Billion in Digital Advertising and Marketing: Where is it Coming From?”

Jackmyers.com, June 15, 2011, http://www.jackmyers.com/commentary/jackmyers-think-tank/Jack-Myers-Video-Report--54-Billion-in-Digital-Advertising-and-Marketing-Where-Is-It-Coming-From.html.

14 “Mobile Ads Outperform Standard Banners,” eMarketer, July 13, 2011, http://totalaccess.emarketer.com/Article.aspx?R=1008494&dsNav=Ntk:basic|mobile+ctr|1|,Rpp:50,Ro:-1.

MOBILE NORMS

ONLINE NORMS

Ad awareness

AV

ER

AG

E D

ELT

A*

AB

OV

E C

ON

TRO

L

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95OUTLOOK REPORT | VOL 10

The increase in price has been larger than losses from audience

decline. This tradeoff cannot be sustained indefinitely. Even the

least price sensitive marketers will eventually become unwilling

to pay for annual TV CPM increases as the audience size of the

networks and their shows decrease. The 0.8 percent annual rate

of decline from 2004 to 2010 clearly shows that TV ad economics

are approaching a breaking point.15

Mobile is better positioned than online to capture market share

from TV. However, it is important to note that this discussion

of mobile and TV ad spend is limited to the context of devices.

Many of the leading networks and cable Multiple System Operators

(MSOs) are well positioned to capture ad spend that has shifted

to smartphones and tablets. By 2020, digital revenues are

projected to generate 26 percent of total broadcast network

advertising, compared to only 4.1 percent of total network ad

revenues in 2010.16

Mobile consumption is increasingly aligned with TV consumption.

More than 86 percent of mobile Internet users surf the mobile

Web while watching TV.17 Consumption while watching TV now

accounts for 20 percent of smartphone use and 30 percent

of tablet use.18 Tablet consumption in particular aligns with

traditional TV viewing behavior. Just as households often share

the TV watching experience, 50 percent of iPad owners share

their iPad.19 Remarkably, 30 percent of applications on mobile

phones owned by parents were downloaded by their children.20

In addition, primetime occurs during the same hours for both

channels. Mobile traffic, search volume and click through rates

now peak from 7p.m. to 11p.m.21

The most compelling support for mobile engagement superiority

over TV comes from multitasking behavior. Admittedly, there

have been just as many studies that claim that mobile has the

highest engagement rate as there are studies that make the

claim for TV. However, when mobile and TV are consumed at

the same time, mobile appears to capture the user’s attention.

An Interpublic Group (IPG) study found that 94 percent of

TV viewing is distracted by multitasking with another media.

Notably, smartphones were the largest distraction, accounting

for 64 percent of user attention diversions from TV. It appears

that a significant share of the attention decline occurs from

distractions during commercial breaks. For example, Yahoo!

measured 5 to 20 percent increases in traffic during ad breaks

for large TV events like the Academy Awards.22

As the scale efficiencies decline on TV, advertisers will increasingly

look for opportunities to reach the most consumers where

engagement is highest. As users continue to integrate mobile

devices into TV consumption, the engagement and thus the

ad spend will shift from the TV screen to mobile devices.

Priority preparations for the long-­term shift to mobile

REASSESSING INCENTIVES. Most organizations have established,

over many years of traditional media-focused marketing,

15 “U.S. Advertising and Marketing Spending, by Media, 2005-2011 (billions),” eMarketer, April 14, 2009, http://totalaccess.emarketer.com/Chart.aspx?R=84272&dsNav=Ntk:basic|US+Advertising+and+Marketing+Spending%2c+by+Media%2c+2005+2011+(billions)|1|,Rpp:50,Ro:-1.

16 “Jack Myers Video Report: $54 Billion in Digital Advertising and Marketing: Where is it Coming From?” Jackmyers.com, June 15, 2011, http://www.jackmyers.com/commentary/jackmyers-think-tank/Jack-Myers-Video-Report--54-Billion-in-Digital-Advertising-and-Marketing-Where-Is-It-Coming-From.html.

17 “Mobile Internet — Delivering on the Promise of Mobile Advertising,” Yahoo!, March 2011, http://advertising.yahoo.com/industry-knowledge/mobile-internet-whitepaper.html.

18 “In the U.S., Tablets are TV Buddies while eReaders Made Great Bedfellows,” May 19, 2011, Nielsen, http://blog.nielsen.com/nielsenwire/online_mobile/in-the-u-s-tablets-are-tv-buddies-while-ereaders-make-great-bedfellows/.

19 “Tablet Opportunities for News Publishers,” INMA, January 26, 2011, http://www.inma.org/modules/store/index.cfm?action=store_detail&pubid=107.

20 “U.S. Parents Say Almost a Third of the Apps on Their Phone Were Downloaded by Their Children,” Nielsen, April 27, 2011, http://blog.nielsen.com/nielsenwire/online_mobile/u-s-parents-say-almost-a-third-of-the-apps-on-their-phone-were-downloaded-their-children/.

21 Kunur Patel, “When’s the Prime Time in Mobile?”, TVWeek, http://www.tvweek.com/news/2011/07/whens_prime_time_in_mobile_sam.php.22 “Mobile Internet — Delivering on the Promise of Mobile Advertising,” Yahoo!, March 2011, http://advertising.yahoo.com/industry-knowledge/

mobile-internet-whitepaper.html.

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96 LIMITED TIME TO PREPARE FOR UNLIMITED POTENTIAL OF MOBILE

incentives for internal marketing departments and external

agencies to promote behavior that maximizes performance.

These incentives may not reward behavior required to execute

on mobile or across an increasingly fractured landscape. Internal

and agency incentives must be evaluated and changed to align

with the new marketing objectives.

EVALUATING TALENT. Many marketers and agencies have

spent decades focusing their expertise on cost reduction.

Traditional media has become commoditized and the benefit

of a commodity cannot be increased. Also, the gains from

a marketing campaign are harder to measure than a reduction

in cost. Thus, ROI increases on these channels have come

predominantly from reducing costs. However, the selections

of internal team members and agencies that will be accountable

for a strategic shift to mobile marketing must take into account

the required skills and expertise needed to create a completely

new marketing product. Individuals and organizations must

be creative, entrepreneurial and capable of working in an

unstructured environment. Thus, mobile teams must have

expertise in increasing the benefits side of the ROI equation.

REALIGNING ORGANIZATIONAL STRUCTURE. Brands and agencies

are often large organizations, which consist of specialized,

siloed departments. This structure is intended to increase

the efficiency of executing an unchanging workflow process.

However, determining how to execute a new type of marketing

in a dynamic environment requires more information sharing

across disciplines and the flexibility to respond to unforeseen

challenges and opportunities. In a rapidly changing industry,

horizontal integration, rather than vertical siloes, increases

efficiency and speed. An internal cross-disciplinary leadership

team should be created to facilitate information sharing.

However, a decision maker must be selected. Input is

valuable but accountability is essential. Similarly, marketers

are best served by a single agency that has a large number

of experienced professionals in each discipline required to

engage consumers on mobile. The value of this structure was

substantiated in the early years of TV, when creative and media

services were provided by the same agency.

SECURING RESOURCES. Marketers will undoubtedly face

organizational resistance to the uncertainty that accompanies

a transition from the familiar traditional media to a transitional

state of mobile media. Convincing stakeholders of the value of

a shift in budget to mobile is not sufficient to initiate action. Even

if every executive agrees in principle, action is not guaranteed.

Taking funds away from one part of the organization requires

indisputable evidence of an increase in ROI. The best process

to provide a performance-based case is through an iterative

approach. Mobile executions should not be experiments. Each

mobile initiative must be viewed as a potential proof point in

support of mobile. The ROI calculation of the performance from

the campaign or development project should be outlined before

it begins. This output is an essential requirement for maintaining

momentum and obtaining access to larger investment resources

as mobile needs increase exponentially over time.

IDENTIFYING UNKNOWNS. At this stage in the evolution of

mobile, knowing what you don’t know is just as valuable as

what you do know. It is important to measure and obtain as much

information as possible. Not every result can be predicted by

a model, and many gains will not be immediately measurable. Yet,

it is important to identify what you want to know, so that you know

what to look for as measurement capabilities improve, processes

are established and infrastructure is created. The pipes of the

mobile ad industry aren’t broken — they are in the process of being

built. In many instances new ways of calculating performance

must be created as intermediary solutions. For example, it may

not be possible to determine the value of a lead generated from

mobile. To ensure that this outcome from the marketing program

is included in the ROI, the cost of generating the lead on another

channel can be used instead.

The speed of change in media, technology and marketing has

redefined the causes of uncertainty, from doing something new,

to doing nothing at all. In this dynamic environment, success

will not be the product of accurate short-term and long-term

market predictions. Rather, industry leadership will come from

companies that made sure that they didn’t have to. As Ray

Kroc, the founder of McDonald’s, prophetically said, “I don’t

know what we’ll be selling in the year 2000, but whatever

it is, we’ll be selling more of it than anyone else.”

Page 97: Razorfish outlook report 2011 (vol10)

97OUTLOOK REPORT | VOL 10

Below is a prediction of mobile and TV ad spending. We used

two methodologies to calculate future mobile ad spend to

ensure that we’ve made reasonable assumptions, and then

calculated and compared an estimate of TV to see when mobile

ad spend could surpass TV. (See chart below.)

The first methodology is based on year-on-year growth rates

for the next 10 years, encompassing years 7 to 18 for the mobile

ad industry. From 2012 to 2014, we used Forrester’s projected

average mobile ad spend growth of 50 percent per year. We

used SNL Kagan’s projected mobile ad spend growth of 40

percent for 2015 to 2020. For mobile advertising’s years 16

to 18, encompassing 2021 to 2024, we’ve assumed 20 percent

growth, online’s current and projected growth for years 16 to

18. Based on Forrester’s estimate for mobile ad spend in 2011,

$1.652 billion and the aforementioned growth rate assumptions

for the next 12 years, mobile ad spend in 2021, 2022 and 2023

would be $50.4, $60.5 and $72.5 billion, respectively.

To confirm the accuracy of this mobile prediction we recalculated

it with a second methodology, projecting mobile’s share of ad

spend by media segment. Email marketing spend is projected

to be $34.6 billion in 2020. If mobile currently accounts for 20

percent of opened marketing emails, that rate should at least

double when smartphone adoption increases. Mobile email

spend in 20 years would be $13.84 billion, or 40 percent

of the total spend. Search ad spend is projected to be $40.9

billion in 2020. If mobile search is estimated to account for

20 percent of searches in 2012, then a 40 percent share of ad

spend can also be applied to search. Mobile search ad spend

would be $16.36 billion in 2020.23 Finally, display advertising

is the last segment. Internet display is projected to be $12.33

billion in 2011.24 Since current growth trends support time

spent and penetration numbers for mobile that are equal

to or surpass online by 2020, mobile display ad spend should

at least be equal to Internet display ad spend in 2011. The sum

Mobile and television ad spend estimates

23 “The Social Commerce Economy,” Jack Myers Media Business Report, August 23, 2011, http://jackmyers.v.reutersinsider.com/.24 David Hallerman, “U.S. Online Ad Spending: The Floodgates Are Open,” eMarketer, June 29, 2011, http://totalaccess.emarketer.com/Reports/

Viewer.aspx?R=2000787. 25 Harold L. Vogel, Entertainment Industry Economics, Cambridge University Press.26 “U.S. Advertising and Marketing Spending, by Media, 2005-2011 (billions),” eMarketer, April 14, 2009, http://totalaccess.emarketer.com/Chart.

aspx?R=84272&dsNav=Ntk:basic|US+Advertising+and+Marketing+Spending%2c+by+Media%2c+2005+2011+(billions)|1|,Rpp:50,Ro:-1.

2023202220212020201920182017201620152014201320122011

$72.54 $68.81 $65.33 $41.7920%20% 0.5% -3.5%$60.45 $57.34 $65.01 $43.3120%20% 0.5% -3.5%$50.38 $47.78 $64.68 $44.8840%20% 0.5% -3.5%$41.98 $34.13 $64.36 $46.5140%40% 0.5% -3.5%$29.99 $24.38 $64.04 $48.1940%40% 0.5% -3.5%$21.42 $17.41 $63.72 $49.9440%40% 0.5% -3.5%$15.30 $12.44 $63.41 $51.7540%40% 0.5% -3.5%$10.93 $8.88 $63.09 $53.6340%40% 0.5% -3.5%

$7.81 $6.35 $62.78 $55.5840%40% 0.5% -3.5%$5.58 $4.53 $62.46 $57.5940%50% 0.5% -3.5%$3.72 $3.24 $62.15 $59.6840%50% 0.5% -3.5%$2.48 $2.31 $61.85 $61.8540%50% 5.0% 5.0%$1.65 $1.65 $58.90 $58.90125%125% 4.0% 4.0%

AGGRESSIVE AGGRESSIVECONSERVATIVE CONSERVATIVE

SPENDYEAR SPENDSPEND SPENDGROWTH GROWTHGROWTH GROWTH

of these mobile ad spend segment projections for 2020

is $42.53 billion, which is only 1.3 percent higher than ad

spend calculated for 2020 using the first methodology.

Over the next 10 years, TV ad spend should decline.

ZenithOptimedia estimates mobile ad spend will be $58.9 billion in

2011 and increase to $61.85 billion in 2012. The 4 percent growth

in 2012 will be attributed to the Olympics and the presidential

election. However, we believe TV will decline 3.5 percent annually

from 2013 to 2023, the same average rate of decline of local TV,

syndication TV, newspaper, magazine, radio and directory from

2000 to 2010.25 Based on ZenithOptimedia’s estimate for 2012

TV ad spend and the aforementioned rate of decline assumption

for the following 11 years, TV ad spend in 2021, 2022 and 2023

would be $44.88, $43.31 and $41.79 billion, respectively.

Based on the above assumptions and projections, mobile ad

spend will surpass TV ad spend in 10 years. Even if TV retained

its 0.5 percent average ad spend growth rate from 2000 to 2010,

ad spend in 2021, 2022 and 2023 would be $64.68, $65.01 and

$65.33 billion, respectively.26 This scenario has mobile ad spend

surpassing TV ad spend in 12 years, only a two-year delay.

Mobile Television

*SPEND IN BILLIONS

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99OUTLOOK REPORT | VOL 10 OUTLOOK REPORT | VOL 10

How the Open API Movement Can Help Your BrandIn an analysis of innovative companies, Razorfish has found that it’s not just the organizational culture or leadership that creates innovation; it’s the willingness to allow consumers and developers to identify new uses for existing data and infrastructure via open digital services. Whether the goal is adding new revenue streams or extending global reach, embracing an open digital service model is an imperative step.

When executives are challenged to innovate, they often try to take old routes to

new business ideas. While analyzing innovative companies, we’ve found that it’s

not just the organizational culture or leadership that creates innovation — it’s the

willingness to allow consumers and developers to identify new uses for existing

data and infrastructure via open APIs. Innovation leaders like Google, eBay and

Twitter process billions of digital service calls every day, adding real business

value to more categories and brands than once thought possible. Whether your

goal is adding new revenue streams or extending global reach, embracing open

APIs is a step you must consider to help ensure success.

Scan the QR code on the left to view the video “What is Open? A simple description

of APIs.”

For brands steeped in technology — like Best Buy, Netflix, eBay or Amazon —

this is easy. In the last few years, open API adoption has grown many times over.

According to Programmableweb.com, in 2010, more than 2,800 brands offered

data or service over open API. That means 25 times more brands are taking

advantage of the open API movement than five years ago. But let’s not be fooled

Salim Hemdani Group VP, Experiences

and Platforms

@SHEMDANI

Basel Salloum Group VP, Technology

LINKEDIN.COM/IN/SALLOUM

WITH CONTRIBUTOR

WRITTEN BY

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Page 100: Razorfish outlook report 2011 (vol10)

100

by this growth. Razorfish’s analysis shows that this growth

comes mainly from Internet/social brands, and not from those

that are considered traditional. Others may be scratching their

heads as they think about how open APIs and community

participation can help their traditional businesses.

We are living in a fast-changing environment with steady

proliferation of applications, platforms and devices. Data

is growing, as are the number of transactions, and cloud

computing is making things easier and faster. On top of these

shifts, user expectations and behaviors are changing, too. This

calls for rapid and continuous innovation to maintain competitive

advantage. Keeping up with change is necessary, but shifting

the focus of your workforce can be a major distraction. Opening

data and/or services to the larger community provides greater

access to community brainpower, thus, more opportunities.

There’s a major opportunity for more traditionally minded brands

to take advantage of exposing their data and/or services through

open API. For evidence, look no further than a company

engaged in one of the most traditional of business activities:

gold mining.

Thar’s gold in them thar hills

In early 2000, businesses were breathing a sigh of relief after

the non-event that was Y2K, and the Internet bubble was still

at its peak. On March 10, 2000, NASDAQ reached a record high

of 5132.52. Stock investments were lucrative and the gold market

was depressed. In that economic environment, gold producer

Goldcorp Inc. was not only suffering from market trends, but also

from internal organizational issues. CEO Rob McEwen knew

his mines had great potential, but lacked resources to identify

where to mine in the vast, 55,000-acre Red Lake area in

Northwestern Ontario. Having learned about technological

advances during a seminar at MIT, he was fascinated by the

open-source code movement and the success of Linux operating

system, which programmers across the globe had built for free.

This concept of community involvement caught McEwen’s

attention, after which he knew exactly what he needed to do.

At an industry meeting in March 2000, McEwen unveiled the

“Goldcorp Challenge,” an open invitation to experts around

the world to participate in a competition to help Goldcorp

identify where to mine. About 400MB of Goldcorp’s confidential,

proprietary geological data was made available to more than

HOW THE OPEN API MOVEMENT CAN HELP YOUR BRAND

There’s a major opportunity for more traditionally minded brands to take advantage of open-­source software development.

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101OUTLOOK REPORT | VOL 10

1,400 scientists, engineers and geologists from 50 countries

around the world who downloaded the data and started virtual

exploration. Within days Goldcorp started to receive entries.

The winner was a collaboration of two groups in Australia —

The firm formerly known as Fractal Graphics, and Taylor Wall

& Associates, which together suggested five specific locations

to mine and developed a powerful 3D, graphical depiction. Each

one of the locations yielded gold, and the Goldcorp Challenge

changed the company’s fortune. In exchange for a small award

to the winners, Goldcorp found metal worth more than $6 billion.

Since then Goldcorp has seen its share price increase from the

single digits to more than $50, and it has become the second-

largest gold mining company by market capitalization. With

mines in Canada, the U.S. and Mexico, and a pipeline that

includes other spots in Latin America, it’s widely considered

an industry leader. How did it get there? By opening itself up

to a community that could help it improve. The lesson here is

simple — You don’t need to be an e-tailer or a country whose DNA

was twirled together in Silicon Valley in order to take advantage

of the wisdom of the crowds. When you recognize the value in

that wisdom and find a way to leverage it, the benefits are clear.

Open API benefits

NEW REVENUE STREAM. Using open APIs can create a new sales

channel. For instance, Best Buy’s platform, BBYOpen, allows

a worldwide community to freely access product information,

store details and reviews via a set of RESTful APIs. This enables

developers to create apps that facilitate purchases from Best

Buy. The BBYOpen initiative started as a small IT venture —

today it is one of the primary sales channels for the company.

COST SAVINGS. New device proliferation demands different

digital experiences around products across different interfaces.

However, creating unique experiences for each interface can

prove costly even for big brands. Open API allows developers

to create those experiences free of charge. Twitter, for example,

didn’t launch its first official application for iPhone until 2010,

but a multitude of Twitter apps for the device have been

available in the App Store since the launch of iPhone in 2007.

The developer community filled the gap.

BRAND EQUITY. Utilizing open APIs can engage brand evangelists

in a meaningful way, creating stronger community and as

a result increases equity. Once the community is engaged,

the cycle of innovation grows exponentially. Facebook’s total

user base increased four times in less than a year after May 24,

2007 — when the company announced the open platform for

the developer community to build social applications.

BRAND GOALS. Finally, open API allows staff and talent to focus

on brand goals because staff is less distracted by continuous

noise in the technology landscape. Additionally, feedback from

the community helps facilitate better product roadmap planning.

How to do it

Despite hard facts and evidence, traditional brands are wary

of sharing proprietary data. There’s often an organizational

inertia that slows the pace of change but, while change is

hard, it is the only constant. There has been some progress,

especially in the healthcare and financial services industries —

which traditionally resist such ideas — but the progress is minor

at best. A model of crawl-walk-run can help:

Start small. Open up one data set or service.

Engage with the community and give people the freedom

to express their needs and wants.

Seek feedback and track progress. Community feedback and

the experience that community creates can help make a case

that can help move the organization in the right direction.

Open API initiatives will not make you glamorous overnight.

It is a slow process of energizing brand evangelists. In the next

few years, it will be de-facto to have a http://developer.<your

brand name>.com entity. Smart brands will get there faster and

laggard brands will follow. It is up to you to decide where your

brand falls.

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103OUTLOOK REPORT | VOL 10

Organizing for Digital SuccessDeep down, even digital agencies know that it takes more than a few flashy new experiences to build real, long-­term competitive advantage through digital. It’s not enough to deploy a suite of new platforms and programs; to reap the benefits, you’ve got to be able to manage and evolve those assets over time. This requires a set of new capabilities — and those capabilities don’t come from technology alone, but from the right combination of technology and human expertise, properly deployed and managed. We’ve outlined five common pitfalls to avoid on the way to digital leadership.

We digital agencies should do more to help clients build these new capabilities.

Our visibility into many types of organizations gives us real-time insight into

what’s working and, more often, what’s not. For this reason, savvy clients

are increasingly seeking our advice as they consider how best to organize

and manage the digital function. Most are hoping for a set of clear-cut best

practices. But for such a young and rapidly evolving business discipline,

obvious answers are few and far between. Defining a “correct” structure for digital

requires a tailored solution that accounts for each organization’s unique structure,

culture and existing practices. To date we’ve collected far more cautionary

tales than genuine best practices, but looking across multiple industries and

organization types, a few general patterns start to emerge. Specifically, in

debating how best to structure for digital, we’ve seen many organizations get

stuck on solving one or more intractable problems that are actually less relevant

to long-term progress than they initially seem.

OUTLOOK REPORT | VOL 10

Tim Perlstein Group VP, Strategy

LINKEDIN.COM/IN/TIMPERLSTEIN

Bethany Fenton VP, Experience

LINKEDIN.COM/IN/BETHANYFENTON

WRITTEN BY

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Page 104: Razorfish outlook report 2011 (vol10)

104

Here are five common pitfalls to avoid on the way to digital

leadership:

1. OBSESSING ABOUT OWNERSHIP

Many organizations fret about which senior executive should

“own” digital. Usually this comes down to the CMO or CIO.

And while this is indeed an important, sensitive decision, we’ve

seen that it can work both ways. The CMO versus CIO debate

is a bit of a red herring, and if it goes on too long, becomes

a dangerous distraction from the real work at hand. For most

organizations, digital’s organizational home is ultimately less

important than the strength, capability and cohesion of the

digital team itself — regardless of where it resides.

Furthermore, in either scenario we believe digital should be more

different from its parent organization than it is alike. In general,

IT organizations value stability and security, while marketing

emphasizes speed, creativity and customer-centricity. The ideal

digital organization combines the technical capability of IT

with the customer sensitivity and agility of marketing — without

getting bogged down by the legacy mind-sets, processes

or politics of either function.

At the end of the day, digital is best understood not as a subset

of marketing or IT, but as a new, separate animal. With strong

team leadership and an effective executive sponsor, digital

can, in theory, thrive under either umbrella — depending on

the specifics of the organization, of course.

2. POLISHING THE PLAN

As with the CMO versus CIO debate, most organizations spend

an inordinate amount of time defining and refining their digital

roadmaps. We love these roadmaps and consider them an

invaluable tool for communicating long-term plans and aligning

effort. However, we also know that technology moves quickly,

and that today’s brilliant three-year roadmap may start to look

pretty silly around month 17. Yes, it’s essential to have a plan

to work and measure against. But it’s equally important to be

able to track the market, react quickly and adapt as necessary.

Over the long haul, the ability to support rapid deployment,

testing and optimization of new experiences is far more important

than perfect planning — and a far more important determinant

of long-term digital success.

ORGANIZING FOR DIGITAL SUCCESS

Digital is best understood not as a subset of marketing or IT, but as a new, separate animal.

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105OUTLOOK REPORT | VOL 10

3. CHASING THE SHINY OBJECT

It’s unavoidable that as digital technology becomes more and

more complicated, digital organizations become more specialized

and functionally fragmented. The advent of significant new

technologies often requires new organizational capabilities,

and additional people to handle specialized tasks. Think about

how social media has made social listening and influencer

outreach must-haves. However, there’s a limit to the amount

of subspecialization any team can afford to take on. More

people means more management overhead — recruiting takes

time, integration can be complex and specialists are always

in short supply.

Instead of building sub-teams around every hot digital technology,

smart leaders identify emerging capabilities that will be important

in the long term, and find ways to bake these abilities into the

broader team’s DNA. Sometimes, this may require adding new

people; in other cases, new kinds of cross-training or smart

partnering may be more appropriate. Bottom line — If you build

your organization around long-term capability requirements

rather than current trendy topics, you’ll be better positioned

for long-term success (and won’t have to reorganize every time

a hot new technology emerges).

4. STEERING BY COMMITTEE

A surprising number of organizations still try to coordinate

digital activity via cross-functional steering committees that

only meet periodically. These are good forums for keeping

multiple functions informed of digital trends and initiatives —

and to solicit their input on relevant tactics, such as compliance

policies. However, they’re not an efficient vehicle for establishing

strategy or managing day-to-day operations. Think of them

as the “C” and the “I” in a Responsible, Accountable, Consulted,

Informed (RACI) chart — not the “A.” Digital teams need to

move much more quickly and decisively than cross-functional

committees usually can. So while it may be politically difficult

to consolidate digital leadership under a single team leader

or executive sponsor, the operational benefit is usually worth

the pain.

5. WALLOWING IN LEGACY IT ENVIRONMENTS

Here’s an all-too-common scenario: The digital or marketing team

wants to deploy a new platform or program, but can’t do so

without changing or potentially destabilizing existing enterprise

architecture. IT wants to help, but the needed changes are part

of a bigger enterprise IT roadmap with multiple dependencies

and competing priorities. The requested digital changes may

happen this year… or they may not, depending on how budgets

and other projects shake out. So the digital team gets stuck

in an unwinnable tug of war with other enterprise priorities.

If this sounds familiar, the good news is you’re not alone.

The bad news is, the only real way out of this trap is a

fundamental replatforming that separates digital experience

technologies from other enterprise IT systems as much as

possible. For the most part, enterprise IT roadmaps are simply

not fast enough or predictable enough to support customer-

centric digital programs.

The key takeaway here is that technology architecture affects

organizational effectiveness. Fortunately, there are ways

to divorce the Web presentation layer from other IT systems,

and to develop an applications layer and APIs that allow the

digital team to quickly deploy changes and experience upgrades

without causing harm to underlying enterprise systems with

which they have to integrate. Creating this separation within

the technology stack can be a difficult, painful process, but

worth the investment. And without this kind of architecture

running in the background, your digital team will be working

at a competitive disadvantage right from the start.

So what does work?

Every organization is different, and the “right” answer for your

business will depend much more on specific personalities and

individual skill sets than on any theory of organization. All that

said, we find most organizations need to do at least some

of the following:

Implement some greater degree of centralization for

digital across the enterprise to better coordinate strategy

and realize platform efficiencies.

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106

Improve connections between digital and the broader organization

through effective cross-functional governance structures and

enlightened executive sponsorship.

Build a more balanced, integrated skill set within the digital

team, encompassing both creative (marketing, user experience,

design, content) and technical (presentation layer development,

analytics) expertise.

Find a strong, versatile, articulate leader to head up the

digital organization.

Allow C-level reporting (or at least visibility) for the digital

team’s leader, in order to fully realize the transformative

potential of digital as a growth driver for the total business.

In defining solutions for specific clients looking to maximize

digital success, we analyze existing organizations across

multiple dimensions, including leadership, structure, strategy,

funding, roles and skills, processes, incentives and more.

Our experience across multiple industries and companies

allows us to offer an impartial, comparative perspective that

often helps clarify and resolve long-running internal debates.

However, at the end of the day, we usually find that defining

an organizational plan for digital is actually the easy part.

Implementing that plan successfully within an existing structure,

culture, and business environment can often feel like the most

challenging digital deployment of all. But for organizations truly

looking to leverage digital for long-term competitive advantage,

the rewards are worth it.

ORGANIZING FOR DIGITAL SUCCESS

Long-term, the ability to support rapid deployment, testing and optimization of new experiences is far more important than perfect planning.

Page 107: Razorfish outlook report 2011 (vol10)

107OUTLOOK REPORT | VOL 10

RF: Tell us a bit about your digital team. What is its charter,

and where does it “live” within the broader organization?

BK: Our digital team is a key part of our larger commercial

organization and is responsible for: 1) generating customer

sales revenue, 2) driving “effortless” customer service, and

3) improving the airport travel experience overall. Working

across multiple areas of Delta, our team is dedicated to

providing our customers with digital options for getting “out

of line and off the phone” and headed to their destination.

RF: What’s working well within your current team, what have

been some of the keys to success?

BK: We have moved from a mind-set of having channel-focused

technology project managers to one of cross-channel product

owners over the years. This shift allows us to better view

travel from a customer’s point of view and we look

at competitors, other industries and changing customer

expectations while also focused on driving consistency

across channels.

RF: How does your company do strategic planning for digital?

Who’s involved and what issues are typically considered?

BK: We are fortunate to have many sources of customer feedback,

from daily verbatims to internal and external studies to our

closed community of Delta digital advisors. We use all this

feedback as the starting point for where to focus our strategic

planning, and then leverage our broader corporate goals

to determine how digital can best help Delta meet them.

We recently held a strategic planning session, which included

representatives from ecommerce, airport customer service,

product development and reservations to discuss where

we’re headed in digital — a truly cross-functional effort.

RF: How do you keep digital initiatives aligned with activities

in more traditional/non-digital businesses and channels?

BK: In our business, it is essential that customers are provided

the same functionality across digital and non-digital channels

to avoid confusion. So we’ve designed our architecture to

support all channels. Our customers get the same information

and service for activities like checking in for a flight,

regardless of whether they choose to see an agent at the

counter, use a self-service kiosk at the airport, visit delta.com

or use one of our mobile applications.

RF: How does your team collaborate with related functions

(including marketing and IT) in your organization?

BK: We have a number of business metrics that drive our

shared success and promote taking ownership both within

and across divisions. Our airport operations, marketing,

IT and ecommerce teams all have a commonly shared goal

of getting our customers through the experience quickly

and easily and we all share in our collective successes.

Also, Delta has a very lean organization, so collaboration

across functions is relatively easy.

RF: How do you see your team evolving over the next one

to two years?

BK: As consumer technology and customer expectations continue

to evolve, we will have to add expertise in developing areas

to ensure we remain fresh. Currently, we’re focused

on tablet and mobile, near field communications and

merchandising. In addition, we’re always looking to add

talented individuals from other industries to make sure

we aren’t overly airline-centric.

Managing Digital at Delta Q&A with Bob Kupbens, VP, eCommerce at Delta Airlines

Page 108: Razorfish outlook report 2011 (vol10)

108

Adam Heimlich VP, Search and Performance Marketing

@ADAMHEIMLICHLINKEDIN.COM/IN/ADAMHEIMLICH

I love to make the line on the chart go up and to the right. It’s

fun, it’s rewarding and sometimes the power that comes from

being able to do it for clients brings a chance to make the world

just a little bit more awesome.

As vice president of search and performance marketing in New

York, I’m fortunate to lead part of the world’s greatest marketing

team (if you measure by results): Razorfish Search. Check us out

at razorfishsearch.com.

I joined the agency in 2006 to help tackle the challenge of

servicing Capital One. Previously I’d learned digital marketing

at smaller agencies and a startup. Before that I spent a decade

in print, mostly newspapers. At Razorfish, I’ve been a member

of the Victoria’s Secret, Ralph Lauren, T. Rowe Price, Schering-

Plough, Forest Laboratories, Starwood and ADT teams. I enjoy

the beginning of campaigns, when we’re establishing relationships

and identifying problems, as well as the mature stages, after

the easy problems are solved and we rely on the strength of

relationships to help brands adapt and not just adjust to the

digital realm. (Like they said in the commercial — You’re soaking

in it.)

In Razorfish’s New York office, I’m active in trying to cultivate

a learning environment, not only because it makes our people

better, but also because it seems to be the best way to market

nowadays. The most popular of the courses I designed is

“Search & Sips,” a consulting/wine appreciation course based

on McLuhan’s theory of “Total Involvement” and my personal

belief in wine as media. It’s very nearly as pretentious as it sounds.

When I’m not obsessively optimizing, I enjoy bicycling, traveling,

cooking and otherwise partaking in the futuristic, global village

lifestyle of Planet Brooklyn — it’s the next media capital, mark

my words.

AUTHORS AND CONTRIBUTORS

Authors and Contributors

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109OUTLOOK REPORT | VOL 10

Basel Salloum Group VP, Technology

LINKEDIN.COM/IN/SALLOUM

When I first arrived in America 24 years ago, one of my primary

goals was to become a “computer expert,” so I followed the

logical path of academia and set out to receive a BS in computer

science from Northeastern University. My “professional career”

began during my first year of college, when I held various senior

positions in the fast food industry that ranged from baking

bread to restocking bars. However, during my second year

as an undergraduate, I landed a job as an associate software

engineer, coding kernel-level programs using my least favorite

programming language: assembly. This changed everything.

Soon after, I worked as a software engineer at Sybase, and then

made the leap from the product side to the service side by joining

Cambridge Technology Partners as a technology architect. There,

I designed and built a number of transactional client server- and

web-based systems before joining Scient as a senior technology

architect, helping companies join the digital movement.

The path from Scient to Razorfish can be traced to mergers

and acquisitions where I played various roles from technology

director to discipline lead to vice president of technology to

my present role.

As for my hobbies (and what’s a bio without hobbies?), I hit

the mountain biking trails whenever I can. I also enjoy honing

my driving (and sometimes racing) skills on the weekend while

transporting my kids to their many activities on time (something

that requires a great deal of precise event planning and time

coordination — and often negotiation).

Bethany Fenton VP, Experience

LINKEDIN.COM/IN/BETHANYFENTON

I started frustrating my parents and teachers with “why” and

“how” questions about everything at a very early age. And the

answers were frequently followed with more “why’s.” I may

have discovered the “five why’s” by the age of 10. It wasn’t

insolence — it was curiosity. I loved understanding why and

how things work.

That curiosity combined with my experience working for one

of the first interactive agencies in the world, Fry Inc., led me to

an emerging discipline now known as user experience. While at

Fry, I worked with premier retailers to establish some of the first

ecommerce sites including Spiegel and Crate and Barrel.

When I joined Razorfish, I had a mentor who exposed me to

“user research.” We went into peoples’ homes to observe how

they put outfits together. While that seems like a menial task,

the struggles, behaviors and emotional investment that went

along with every outfit decision was striking and game-changing.

Physical or digital, people’s needs were not being met.

So a fork-in-the-road moment for me was the realization that

you can be in the business of best practices, live by analyst

evaluations and one-up the competition, or you can make things

better — in a way that’s meaningful for businesses and people.

They’re not mutually exclusive.

As vice president of experience for Razorfish, I work with clients

and teams to find meaningful solutions for businesses and people.

It’s exciting, frustrating and heartbreaking — but at the end of

the day, it’s rewarding.

Having been in the industry for 16 years, I’ve also realized the

importance of down time. It’s all relative though — my vacation

primarily consists of bi-annual fitness adventures in places like

Brazil and/or Costa Rica where I get to challenge my fear of

heights on a daily basis. Oddly relaxing in context.

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110

Brandon Geary SVP, Strategy

@BRANDGEAR

As the leader of strategy for the Americas at Razorfish, I’m

tasked with combining the insight of user experience, strategy

and account planning to deliver strategic recommendations for

a variety of Fortune 100 companies, while helping shape the

future of the Razorfish business. It just sounds like a big job.

I love working with Nike, Best Buy, Levi’s, MillerCoors, Microsoft,

HP and Nintendo. I’ve helped them pull their digital strategy

together and have guided them to early uses of social media,

behavioral targeting and mobile.

Prior to joining Razorfish I was senior vice president of strategic

planning at a division of McCann Worldgroup, where we won

Effies in 2003 and 2004 for Washington Mutual’s New York launch

and home loan campaigns. Prior to McCann, I was marketing

director at Fatbrain.com, an online seller of technology books

and training, which was acquired by Barnes & Noble. I also

held senior account management positions at McCann A&L

and GMO in San Francisco. Despite my digital orientation,

I do indeed read printed matter, and often use my phone for

calling my kids.

AUTHORS AND CONTRIBUTORS

Bob Lord Global CEO

@RWLORDLINKEDIN.COM/IN/MBAHBS1990

As an engineer out of college, I was very much intrigued by the

promise that marketing holds. I decided to go back to school to

study business, specifically marketing. After getting my MBA, I

joined the consulting business. Little did I know that marketing

and technology would eventually collide.

After stints in leading positions at consulting firms, I landed at

Razorfish in 1999 as chief operating officer. Back then, technology

wasn’t advanced enough to deliver on brand promises and the

bubble burst. But the past decade has truly seen the convergence

of marketing and technology and in hindsight my early career

experiences primed me for this shift.

My job has evolved over the years; from chief operating officer,

I became president of our east region for six years, before

becoming global CEO in 2009. The best part of my job is working

with clients and our teams. I love selling new work, challenging

ideas and driving innovation within the organization. Making

a difference to our clients and their bottom lines, and helping

them communicate with consumers like never before — that’s

where I get my energy.

In addition to leading Razorfish globally, I’m a member of Publicis

Groupe’s Strategic Leadership Team, and have a seat on the

board of directors for Publicis Groupe’s VivaKi unit. I also sit on

the board of directors for the Advertising Research Foundation

and I’m an active member of the TED community. Whenever

I can, I also enjoy biking, surfing and spending time with my

family. I hold an MBA from Harvard Business School and a BS

in engineering from Syracuse University.

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111OUTLOOK REPORT | VOL 10

Frederic Bonn Executive Creative Director

@FREDERICBONNLINKEDIN.COM/IN/FREDERICBONN

I started my career at Publication Design, a firm that redesigns

publications in France and the U.K. During that time I was

immersed in the firm’s efforts to guide readers through content,

grab their attention through copy and images, establish clear

hierarchy and provide a flow through the experience — so moving

to digital in 1997 was a logical transition. With a number of

colleagues and in partnership with Roger Black I opened the

Interactive Bureau office in Paris.

Since then, I’ve been traversing the Atlantic, working in New York,

London, Paris then New York again. I moved from Euro RSCG to

Ogilvy to Razorfish, and have led a wide variety of projects ranging

from global digital platforms to innovative digital campaigns for

the likes of IBM and Volvo. Diverse experiences driven by great

creative ideas, from advertising to Web site design, from mobile

apps to branded content, from out-of-home to social media,

have helped me think about communication as an integrated

brand experience for users to engage with through entertainment,

services and conversations.

My work has been recognized at the most prestigious creative

award shows (including Cannes Lions, Webby, Eurobest, Epica,

LIA and FWA) and I’ve been a speaker and juror at various

industry events.

I live in Brooklyn with my wife and two sons, and keep

a photographic report with other photographers

(crossatlanticreport.posterous.com).

Chris BowlerVP, Social Media

@BUCKETQUIZ BUCKETQUIZ.COM/A_HUNDRED_THINGS

I believe social media doesn’t have to be complicated. It’s really

just about being you — And that goes for brands and businesses,

too. The key is to offer something of value that others will respond

to and share.

I started my own version of social media a dozen years ago,

with a Web site that inspires others to create their own bucket

lists — the milestones and activities one wants to complete

before they die. On the passion scale, this goes straight to the

top. Today, check out my blog and daily tweets.

I bring this same fervor to my everyday work and believe that

each client has something valuable to share that can also make

a difference. Whether simply to provide some fun, offer a “deal”

or provide a valued service, the key is to find the elements that

make a true connection.

At Razorfish, I lead our clients forward in ever-evolving social

media channels — 85 percent of the time, this is acting as

a cheerleader/evangelist/therapist/trailblazer to drive idea

development and test-and-learn programs. This all started way-

back-when with online services like AOL and Prodigy, whose

first online ad campaigns I launched, and later, on the burgeoning

Internet, where I introduced the first new product launch for

a major appliance company. (What can I say? I like being first.)

My background is in media. I started in offline advertising with

Campbell Mithun in Minneapolis, before jumping into the digital

pool at Agency.com, where I led the digital media and search

engine marketing practice. And occasionally, I’ve talked about

my circuitous experience at industry conferences such as

SXSW, ad:tech and WOMMA.

When I’m not working, I run. Nine marathons — so far. But running

a marathon is just one of those bucket list items many of us

have on our list of things to do before we die. I’ll ask you if

I get a chance: What’s on yours?

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Jonathan Hull VP, Emerging Experiences

@HULLJONEMERGINGEXPERIENCES.COM

I like the word “ass.”

I try to work it into every conversation I have. “That’s bad-ass,”

“That was a cool-ass experience,” or one of my favorites,

“Oh, that tastes like ass.”

My first couple of jobs after getting my undergraduate degree

were in big-ass IT consulting — Oracle and IBM Global Services.

I love technology and was riding the crazy-ass IT train of the 90s

but something was lacking — the human element. The question

then changed from, “What can people do with computers?”

to, “What can computers do for people?”

So I took a break from databases, app servers and integration

architectures to get my MBA. Upon graduation I switched my

focus to interactive marketing and joined Razorfish to ride the

.com wave.

Having survived the dumb-asses responsible for the .bomb era

I moved past the browser a few years back and refocused on

immersive digital experiences. Why? Because the nature of the

Web is device agnostic; a primary value proposition is to serve

up exactly the same experience across any device. The problem

was I like the technical gadgetry and gizmo-ness of devices

almost as much as saying the word “ass.”

As vice president of emerging experiences (EE) at Razorfish

I lead one of the most innovative teams within any agency.

We’re a cross-functional team of strategists, designers and

technologists. The EE team is constantly looking at new

technologies, devices and digital design paradigms. But

while we love research and development, we also keep it real.

The biggest impact we’re making is helping our clients get

immersive digital experiences into the market. We get to

work with the best people and the best clients in the world —

it’s simply kick-ass.

Jeremy Lockhorn VP, Emerging Media

@NEWMEDIAGEEK

Between my title and my Twitter handle (@newmediageek),

it’s pretty easy to guess what I do. It’s a bit of a dream job

sometimes — I monitor trends, meet with fascinating media

technology developers, and help our teams and our clients

see, plan for and adapt to the future of media. And yet, as

I heard a young entrepreneur once say, “Innovation is not a clean

sport.” Truer words were never spoken. Media innovation can

be messy, ugly, and laced with equal parts risk and uncertainty.

But it’s also incredibly rewarding, both for me personally, and

for clients that get it right and see the massive returns.

I’ve been at Razorfish for most of my career, having joined an

agency startup called i-FRONTIER in 1997. Working out of a

spare bedroom in founder Brad Aronson’s condo was a unique

experience — as was the opportunity to get involved in nearly

every side of the agency business as we grew from the two of

us to over 100 people before we were acquired by Avenue A and

ultimately became Razorfish.

Making the move from Philadelphia to Seattle has been yet another

adventure, and I’ve since embraced the outdoor nature of the

“Pac NW.” When I’m not at work, you might find me hiking,

skiing or camping. In fact, I sort of aspire to retire as a ski bum.

Music is my other passion, and I just hope that all these years

of pounding on the laptop keyboard doesn’t give my guitar

fingers too much trouble.

AUTHORS AND CONTRIBUTORS

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113OUTLOOK REPORT | VOL 10

Marc Sanford, PhD Director, Customer Insight Group

@MMSANFORD LINKEDIN.COM/IN/MARCSANFORD

I have been with Razorfish for more than four years and

specialize in delivering custom analytics solutions to both internal

and external clients. While the insights and analytics group has

many standard approaches to solving clients’ problems,

sometimes these issues don’t fit neatly into these approaches.

I delight in working directly with clients, learning about their

business challenges and designing business and analytics

solutions. Examples of such innovation come from leading the

development of the personalization offering within our agency,

building a team of skilled folks to create the generational tag for

tracing and measuring social behavior through the spread of

social applications (patent pending), and partnering to help

develop and implement the razorfishOPENTM framework across

several clients. During the past four years or so, I’ve worked

with a wide range of clients including Microsoft, Best Buy,

Levis, CLEAR, Disney and others.

Prior to joining Razorfish I received my PhD in Sociology from

the University of Chicago and worked at the University of

Maryland as an adjunct professor of sociology. My dissertation

was a study of purchasing patterns of roughly 800,000 people

over a two-year time period in the city of Chicago. I revealed

unique patterns of similarity in consumption through cluster

analysis, logit and probit regressions, adjacency analysis and

other statistical and ethnographic techniques.

Outside of work I am a new father enjoying the special moments

a new father has with his son, and learning to cope with less

sleep. I enjoy watching the University of Washington Huskies

and spending time with my wife. I also try to play bluegrass

guitar when I am able to find some free time.

Ken HongManaging Director, Razorfish China

LINKEDIN.COM/IN/KENLIZHOUHONG

I am probably not your typical ad man. Although I’ve spent

more than 13 years in marketing, eight of which have been in

digital, I approach marketing from a strategy and analytics

perspective rather than the typical creative angle. Over the

years, I’ve helped many clients including Microsoft, Nike,

Unilever, Best Buy, Expedia and L’Oreal develop and execute

global and local digital marketing programs. I have also held

various positions in marketing and finance functions within

Fortune 500 companies. I currently lead Razorfish in China,

where I set the strategic direction for the agency, and manage

day-to-day operations.

Originally from Shanghai, I have spent 17 years studying and

working in Switzerland and the U.S. Before returning to

Shanghai to run Razorfish, I was the vice president of strategy,

analytics and innovation in Razorfish’s Seattle office.

When I’m not trying to figure out how to bring more digital

innovation to our clients, I love playing golf and traveling. So

I’ve concluded that playing golf in Hawaii is the most efficient

way to spend my vacations.

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Paul Gelb VP, Mobile Practice

@PAULGELB LINKEDIN.COM/IN/PAULGELB

I’ve had one of the more unique career paths at Razorfish; I

started as an MBA intern in the strategy group and now I head

up the agency’s mobile practice. My trajectory is undoubtedly a

testament to Razorfish’s ability to support personal development

and unconventional entrepreneurial pursuits.

In my current role as vice president of mobile practice, I oversee

a team that includes strategy, site/app development, messaging

programs, media, search and ad creative. But mobile is more than

my job; it’s a personal passion. I am, almost without exception,

carrying at least four mobile devices: three smartphones and

a tablet. This contagious desire has led to an unrelenting output

of groundbreaking mobile work for almost every Razorfish.

Specifically, we’ve developed 16 applications that were listed

as a top app or featured in the iTunes App Store, including the

top branded application of 2008 and an iPad app that became

the number one free download. We’ve also designed some of

the most successful mobile commerce sites to date, generating

more than 15 percent conversion rates and more than $2 billion

in annual revenue.

Our success has not gone unnoticed; our clients have won mobile

marketer of the year, luxury mobile marketer of the year, and

several min and Digiday awards. In 2010, I was the youngest

person awarded Mediaweek’s Media All-Star Award. My point of

view and industry projections have been sought out by The New

York Times, The Wall Street Journal, Forbes, Advertising Age,

Forrester and Mobile Marketer. I’ve been identified as a thought

leader in the industry with speaking engagements at SXSW, MMA,

IAB and OMMA conferences. I have an MBA from the Anderson

School of Business at UCLA and a BS in International Business and

Macro-Economic Theory from the ILR School at Cornell University.

Mark Taylor VP, Customer Insight Group

LINKEDIN.COM/IN/MARKCHRISTOPHERTAYLOR

I’m a big believer in customer-centric marketing to solve our

clients’ business problems and help them bridge the gap

between their brands and customers.

Since swapping tea bags for coffee beans as part of my

relocation from London to Seattle in 2007, I’ve learned the

inner workings of ad-serving data, advanced analytics, and Big

Data-led solutions to address client challenges for the likes of

Microsoft, Best Buy, Staples and Intel.

As vice president of the customer insight group, my team and I

collaborate with other disciplines to translate business challenges

into holistic and market-first solutions for our clients across the

network. Part of this team’s role involves architecting actionable

insights and implementing dynamic, targeted marketing strategies

that deliver measurable results.

Prior to joining Razorfish, I headed up customer experience at

Homechoice, the first U.K. IPTV platform owned by Time Warner,

Sony, Disney and Chris Larson (Microsoft co-founder). I’ve also

worked in senior management roles for Centrica, Organic Inc.

and SITEL Corporation, leading a variety of customer strategy

engagements with Fortune 100/FTSE 100 companies.

In my spare time, my wife does her best to get me to do more

yoga, and I’ve embraced U.S. MLS football (that’s “soccer”

to you Americans) as a season ticket holder at the mighty

Sounders FC. I also serve as an advisory board member for

the University of Washington Business Extension Program.

AUTHORS AND CONTRIBUTORS

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115OUTLOOK REPORT | VOL 10

Pete Stein President, East

@PSTEIN211

I have always believed that the whole is greater than the sum

of its parts. That belief, along with a thirst for exploration, has

guided my decisions throughout life.

When I found the Internet, I knew that my affinity for being on high

performing teams would be satisfied. This is a business where

technologists and marketers, creatives and project managers,

math geniuses and account people all must come together to

crack codes and solve riddles. Creating an environment where

the best ideas can rise from the mosh pit is part art and part

science — and always interesting.

As for that thirst for exploration, I’ll never forget my first encounter

with the Spyglass browser in 1995 — it was love at first sight.

I knew that the browser would open a whole new world and

luckily for me, it keeps on changing. Every few years, the playing

field dramatically shifts, and to succeed you need to completely

re-orient yourself.

As the president of the east for Razorfish, I am lucky to be able

to tap into my passions every day. I’m surrounded by talented

people who share my belief in the power of collaboration. We

get to work with some incredible brands like Mercedes-Benz USA,

Unilever’s Axe, Citibank, Starwood and Ford Motor Company —

brands that have all embraced winning through digital.

You can find me on LinkedIn or on Twitter. And on the weekends

you can find me coaching the power of team play to one of my

kids’ sports teams.

Pradeep Ananthapadmanabhan Chief Technology Officer, VivaKi

LINKEDIN.COM/IN/PRADEEPANANTH

As the chief technology officer for VivaKi, the division of

Publicis Groupe that oversees digital and media, I’m responsible

for envisioning and executing the engineering strategy that

supports our suite of data-driven applications. This includes

our digital advertising trading desk as well as one of the world’s

largest data warehousing/BI operations. Both are targeted at

increasing the ROI on advertising spend through the strategic

use of technology.

Before joining VivaKi in 2010, I was with Razorfish for more than

six years, most recently as the group vice president of technology

for the west region. In that capacity, I led a team of 30+ engineers

who brought to life digital strategies for brands such as Singapore

Airlines, the National Football League (NFL), Intel, Microsoft

and Westfield.

After completing my Master’s in Information Systems Management

from Carnegie Mellon, my first job was with NEC Solutions.

My Web 1.0 portfolio includes developing and launching initiatives

for Sun Microsystems and Wells Fargo, among others. Nowadays,

the technologies that interest me most are enterprise content

management, cloud computing, touch frameworks, mobile

platforms and Web performance management.

While not thinking about terabytes and petabytes, you’ll find

me watching long Bollywood movies, hiking some of the most

beautiful trails of Northern California, or reading about time

and space and wondering if we do exist at all.

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116

Rafi Jacoby Social Technology Lead

@RJACOBY

As an engineer, I always think there must be new and better ways

to solve a problem. I like to work end-to-end — building servers,

designing databases, working with asynchronous queues, and

creating dynamic HTML5/CSS3/JavaScript URLs. I have been

working with the major social platform APIs since they became

available, and am a co-author of Koala, the leading Ruby Gem

for Facebook’s Open Graph. I’m very much a practicing geek —

if you ask me if something can be done, I’ll likely throw together

a Sinatra app to do some testing. I wrote this biography using Vim.

Before joining Razorfish, I was director of engineering at Context

Optional, where I guided the development of a leading social

monitoring and publishing platform, architected custom

applications, oversaw operations, and built highly scalable

infrastructure and statistics components. I grew the business

using cloud deployment services, and spoke on the experience

at GigaOM Structure, as well as seminars for Oracle/MySQL and

Joyent, and an in an interview in Cloudbook magazine. My prior

experience includes experimental embedded consumer devices

work at Sun Microsystems Labs, mobile telephony infrastructure

and several digital music services.

At Razorfish, I work with our offices and clients across the

country (and sometimes the world) to help guide conception and

implementation of projects that integrate with social networks.

I’ve worked on custom applications, mobile-social crossovers,

site-wide Open Graph implementations and Twitter hooks. I also

track platform changes and evangelize new developments.

Even though I faced the cold as a kid in New York and a computer

science student at Oberlin, I’m preparing for the shock of my first

Chicago winter after spending 13 years in San Francisco. You

can follow my tweets about it, interspersed with my thoughts

on social tech, cloud computing, open source and more.

Ray Velez Global Chief Technology Officer

@RVELEZLINKEDIN.COM/IN/RAYVELEZ

When I wrote my first basic program on my Atari 800 I was

hooked; I’ve been spending time with computers ever since.

I studied computer science and philosophy at Boston University,

looking to bring the answered and unanswered together. The

thing that keeps it exciting is that it’s constantly changing and

always fresh. That’s something I’ve always loved about this

business, and something that’s certainly growing at a faster

pace than ever before.

As the global chief technology officer for Razorfish, I manage

the agency’s capabilities in Web technology architecture and

development, overseeing all of the company’s technologists.

A core part of this role involves looking to the community for

collaboration, and I’m consistently amazed by technologies like

good old message boards and wikis. (In fact, I was fortunate

to help Razorfish build our internal, award-winning wiki.)

My professional experience has been in the application

development life cycle, from inception to rollout, working with

clients ranging from Citibank to Ford Motor Company to the

National Football League (NFL). Most recently, I was the startup

CTO in Razorfish’s role as incubation partner for Bundle, a

personal finance start-up. I also enjoy training and creating

curriculums, and recently led the development of the Razorfish

Agile Process. I’ve been in the industry for close to 20 years,

having worked previously at Cambridge Technology Partners

and Scient.

Anything outdoors is my passion, whether biking, skiing or hiking

with the family. Over the years I’ve enjoyed mountain bike and

ski racing, and was fortunate to ride across Costa Rica in La

Ruta de Los Conquistadores. I also find the DIY culture very

inspiring; I’m looking forward to hacking some Arduino with

my son someday soon.

AUTHORS AND CONTRIBUTORS

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117OUTLOOK REPORT | VOL 10

Salim Hemdani Group VP, Experiences and Platforms

@SHEMDANI ASKDUDE.COM

For 13 years I have been developing and deploying digital

experiences. I’ve spent eight of these years with Razorfish. I love

solving hard client problems on a ubiquitous medium — the

Internet — because its ability to provide a level playing field to

everyone around the world fascinates me. Even more fascinating

is that I live and breathe this digital world, despite the fact that

my first encounter with television was at age 11; my first

computer was at 19.

I started with Razorfish as a developer. Ecommerce and

community development are my fortes — building cutting edge

experiences is my passion. My principal is simple — “Engineering

enables experience.” In other words, “Let’s build an experience

that is not constrained by technological limitations.” At Razorfish,

most of my time has been spent on-site with clients, learning

their processes and culture. Digital consulting requires a unique

blend of expertise, adaptability and agility. I have learned a lot

working with brands like Microsoft, AT&T, Nike, Dell, Best Buy,

Costco, Fujitsu America, Nintendo, Safeco and Wells Fargo.

I have also worked with several start-up companies.

I currently serve as group vice president of experiences and

platforms. I oversee the creative, user experience, delivery

and technology disciplines for Microsoft business and also act

as executive sponsor for all digital experiences executed by my

team of incredibly talented and passionate people.

I am an executive MBA graduate from the University of

Washington in Seattle and I earned my engineering degree

from VNIT Nagpur in India. I am proud member of Beta Gamma

Sigma International Owner Society.

Thomas Sudassy Media Research and Publisher Relations

LINKEDIN.COM/IN/SUDASSY

Duke Ellington delighted in saying, “Music is my mistress,”

and I share his sentiment. From the days of brandishing a Sony

Walkman II as a teenager, to hosting radio shows today, I’m

enthralled with the lasting impressions and lessons of music.

The constant evolution of music draws upon the past and

present to create the ideas of the future.

These same qualities are what have attracted me to digital media

and research for the past 11 years. I thrive in fostering relationships

with the most popular of publishers to promising startups to ensure

our clients get the best service and opportunities. And I constantly

roam the research landscape for best-in-class partners and

products that will provide our teams and clients insights for new

ideas and confidence to execute on them.

You can catch me on LinkedIn or occasionally hosting one

of the Saturday Latin shows on KBCS 91.3 FM (kbcs.fm)

in Seattle, Washington.

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118 AUTHORS AND CONTRIBUTORS118

William Lidstone Executive VP, Razorfish International

@WILLIAMLIDSTONE

Everyone has a favorite teacher, who at some point during their

education, sparks an interest, or even a life-long passion.

In my case, it was a visionary art teacher who introduced me

to the world of design — the intersection of ideas, art, science

and technology. Twenty years ago, this fascination with ideas,

problem solving and product design also became my career —

coinciding with the timely and meteoric rise of digital media.

In early 1995, I led the design team of the U.K.’s first online

shopping mall. A few years later I became head of business

development at OgilvyInteractive, and later head of digital at

Foote, Cone & Belding. Since then I’ve spent almost a decade

at AKQA working with Daniel Bonner (chief creative officer,

Razorfish International), delivering ideas, technology and

products for the likes of Coca-Cola, Ferrari, Fiat, Heineken,

Nike, Unilever and Xbox.

As well as client work, I’ve also been involved in a number of

important initiatives: developing competency frameworks to

nurture expertise, establishing professional development and

leadership programs and finding ways of supporting employees

with young families, despite the demands of digital agency life.

Inspired by a great teacher myself, I’ve recently had the privilege

of educating the next generation of digital product designers, most

notably on Jonathan Ive’s industrial design course at Northumbria

University, as a visiting lecturer. It’s through teaching that I’ve

learned that a truly world-class product requires a blend of

only two key ingredients: The highest standards and the most

capable talent.

Tim Perlstein Group VP, Strategy

LINKEDIN.COM/IN/TIMPERLSTEIN STRATEGY TEAM BLOG: STRATEGY.RAZORFISH.COM

I lead the strategy practice within Razorfish’s central region.

We’re a small-but-mighty consulting team dedicated to helping

clients use digital to maximize business performance, unlock new

growth opportunities and — where needed — drive fundamental

transformation of business, marketing and organizational models.

It’s not as easy as it sounds.

Fortunately, we like to solve hard problems — the harder the better.

We like big-picture thinking, rigorous planning and basic arithmetic

done exceptionally well. (Preferably with charts.)

I feel lucky to be part of this talented team and fortunate to have

worked with, and within, so many other terrific organizations. Prior

to Razorfish, Yahoo! let me play two completely different roles:

One focused on customer-centric innovation, the other on the

tactics of online marketing. At Knight Ridder Digital (remember

newspapers?), we tried to save American journalism through better

online ad products (and very nearly succeeded).

I seem to have an affinity for highly disrupted industries and

companies — which these days is pretty much all of them —

and have worked deeply across media, retail, financial services,

high tech and consumer goods sectors. In past lives, I’ve been

a marketing director, product manager, copywriter and editor —

and in the very early days, even a Webmaster, community manager

and HTML coder. If there’s a digital job to do, I’ve probably done

it at some point… or learned a lot from someone who has.

Speaking of learning: I earned my MBA from Stanford and a BA

in Art History from Harvard (senior thesis on Tibetan thangka

paintings). All of which, believe it or not, has been relevant in

some way to my current work in digital strategy.

To find out more, come look me up in Austin, Tex., where I can

usually be found hanging out by the pool with my wife and son…

planning for the future while still very much enjoying the messy,

ambiguous, disrupted present.

Page 119: Razorfish outlook report 2011 (vol10)

119OUTLOOK REPORT | VOL 10

Obrigado. Gum xia. Merci. Ta. Danke. Arigato. Thank you...... to the 20 Razorfish team members who we asked to capture and share moments of inspiration from their everyday lives. Their photos illustrate how ideas ignite at the intersection of technology and people.

Adam Trimble Presentation Layer Developer

Behan Gifford Account Director

Cameron Cooper Copywriter

Carol Monk Group Creative Director

Carsten Lindstedt Senior Concept Developer

Claire Reeve Designer

Gaurav Bhandari Strategy Analyst

Jamie Feola Associate Designer

Kevin Byrne Analyst

Melvin Hale Associate Creative Director

Natalie Rodic Marsan Research

Patrick Kernan Senior Art Director

Robert Stribley Senior Information Architect

Sara Giessen Senior Designer

Shivani Mohan Researcher

Thomas Guy Senior Designer

Tim Pethel Art Director

Toby Past Creative Director

Todd Ziaja Associate Creative Director

Tomoko Kuwahara Designer

Will Fikes Art Director

And special thanks to Liz Stevison for her illustrations of our authors and contributors.

Page 120: Razorfish outlook report 2011 (vol10)

120

For Additional Information: [email protected]

Media Inquiries: [email protected]

About Razorfish Razorfish creates experiences that build businesses. As one of the largest interactive

marketing and technology companies in the world, Razorfish helps its clients build

better brands by delivering business results through customer experiences. Razorfish

combines the best thought leadership of the consulting world with the leading

capabilities of the marketing services industry to support our clients’ business needs,

such as launching new products, repositioning a brand or participating in the social

world. With a demonstrated commitment to innovation, Razorfish continues to cultivate

our expertise in social influence marketing, emerging media, creative design, analytics,

technology and user experience. Razorfish has offices in markets across the United

States, and in Australia, Brazil, China, France, Germany, Japan, Spain, Singapore

and the United Kingdom. Clients include Carnival Cruise Lines, MillerCoors, McDonald’s

and Starwood Hotels. With sister agencies Starcom MediaVest, ZenithOptimedia,

Denuo and Digitas, Razorfish is part of Publicis Groupe’s (Euronext Paris: FR0000130577)

VivaKi, a global digital knowledge and resource center. Visit www.razorfish.com

for more information. Follow Razorfish on Twitter at @razorfish.

Contact

CONTACT