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Marketing Trends. June 7, 2007. Marketing. “…identifying and meeting human and social needs.” Philip Kotler. Agenda. Myths Trends Paradigms. Driver. The Internet The Internet continues to be the key driving force behind marketing innovation. viral marketing buzz marketing vblog - PowerPoint PPT Presentation

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Marketing TrendsJune 7, 2007

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Marketing

“…identifying and meeting human and social needs.” Philip Kotler

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Agenda Myths

Trends

Paradigms

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Driver The Internet

The Internet continues to be the key driving force behind marketing innovation

WOMMwidgetbligetchickletbuzztracker

mashupdelicioussocial media social bookmarkingSMO

trackbackdiggtagtypelistblogroll

viral marketingbuzz marketing vblogpodcastingcontentcasting

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Marketing Myths The same marketing techniques work every time

You need a multimillion budget to create a commercial

Marketing is all about advertising

Marketing is simply an operational expense

A perfectly executed marketing plan will guarantee success

Marketing’s goal is to increase sales

Marketing starts when you’re ready to launch

Marketing is a function. “Marketing owns it”

Innovation comes from inside

Never give the product / service away

You must position and identify with an industry & competition

Target the broadest customer segment

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Crisis In Mass Marketing 18%: Proportion of TV advertising campaigns generating positive ROI 54 cents: Average return in sales for every $1 spent on advertising 256%: The increase in TV advertising costs (CPM) in the past decade 84%: Proportion of B2B marketing campaigns resulting in falling sales 100%: The increase needed in advertising spend to add 1-2% in sales 14%: Proportion of people who trust advertising information 90%: Proportion of people who can skip TV ads who do skip TV ads 80%: Market share of video recorders with ad skipping technology in 2008 95%: The failure rate for new product introductions 117: The number of prime time TV spots in 2002 needed to reach 80% of adult

population – up from just 3 in 1965 3000: Number of advertising messages people are exposed to per day 56%: Proportion of people who avoid buying products from companies who they think

advertise too much 65%: Proportion of people who believe that they are constantly bombarded with too

much advertising 69%: Proportion of people interested in technology or devices that enable them to

skip or block advertising

Source: Justin Kirby & Paul Marsden (2006). Connected marketing. Oxford, UK: Butterworth-Heinemann. xix

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Status of Marketing Management

“In many organizations, the corporate marketing function has lost budget, head count, influence, and confidence, resulting in strategic consequences than run deeper than

many managers may realize.”

Source: The Decline and Dispersion of Marketing Competence. 2006 MIT Sloan Management Review

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Green Grey Karma Capitalism Transparency Authenticity Democratized advertising WOMM Controversy Market space Social media Trusted social media advertising Online paid search ads

Trends

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Out Traditional advertising

Monologue

Market place

Classical 4Ps paradigm

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70+ Million Weblogs

March 07March 03

Source:http://www.sifry.com/alerts/archives/000493.html

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Websites WW

Netcraft November 2006 survey

In May 2007, the number reported was a little over 118 million worldwide

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12Source:http://www.sifry.com/alerts/archives/000493.html

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13Source:http://www.sifry.com/alerts/archives/000493.html

#1 Japanese

#2 English

#3 Chinese

Posts By Language

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Global Online Population

Currently about 1.2 billion Projected to grow to 1.8 billion by 2010

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Summary 70 million weblogs About 120,000 new weblogs each day, or... 1.4 new blogs every second 3000-7000 new splogs (fake, or spam blogs) created every day Peak of 11,000 splogs per day last December 1.5 million posts per day, or... 17 posts per second Growing from 35 to 75 million blogs took 320 days 22 blogs among the top 100 blogs among the top 100 sources linked to in Q4 2006 - up from 12 in

the prior quarter Japanese the #1 blogging language at 37% English second at 33% Chinese third at 8% Italian fourth at 3% Farsi a newcomer in the top 10 at 1% English the most even in postings around-the-clock Tracking 230 million posts with tags or categories 35% of all February 2007 posts used tags 2.5 million blogs posted at least one tagged post in February

Source: Technorati March 2007. http://www.sifry.com/alerts/archives/000493.html

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Social Media

Social media describes the online technologies and practices that people use to share opinions, insights, experiences, perspectives and media itself. Social media can take many different forms, including text, images, audio, and video. These sites typically use technologies such as blogs, message boards, podcasts, wikis, and vlogs to allow users to interact. Source: Wikipedia

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Word of Mouth Marketing WOMM: Umbrella term

Buzz marketing Special hook, event, promotion. Aqua Teen Hunger

Force Boston Bomb Scare

Viral marketing Branded material, websites, widgets, bligets, videos, utilities,

collaboration tools etc. that sneezers spread. ParkRidge47, Vote Different

Influencer marketing Identifying and finding the influencers

Evangelist marketing Turning most loyal customers into citizen marketers

Street marketing Interacting at popular offline places like Buzz Oven

Stealth / Undercover marketing Bree, lonelyGirl15

Source:Justin Kirby, & Paul Marsden (2006). Connected marketing. Oxford, UK: Butterworth-Heinemann. 198YouTube

Aqua Teen

Buzz Oven

Bree

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Widget Marketing

Cool plug-n-play things for your sidebar

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Mashup

Example of Google Maps mashup on MySpace account.

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U.S. Online Ad $16.9 billion market in 2006

5.9% of the $285 billion total U.S. advertising market in 2006

Notable M&A activity Google bought DoubleClick for $3.1 billion in 4/07 Microsoft bought aQuantive for $6 billion 5/07 WPP Group bought 24/7 Real Media for $649 million 5/07

Source: Wall Street Journal, May 25, 2007, pg. B1

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U.S. Online Ad Spending

Source: Wall Street Journal, May 25, 2007, pg. B1

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New Paradigm Sell your idea first Find your actors (audience) first Size does not matter - PlentyOfFish Reduce risk by pushing control out Value creation increases at the edge Decentralize authority, process, and IP Transparency creates value Truth travels fast Price alone is not sustainable Reengineer your value chain

Skip intermediaries wherever possible

Reinvent your business models Change the status quo

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New Paradigm Democratization of 4Ps paradigm

Citizen branding Collective collaboration Collective risk sharing Collective product innovation Collective IP ownership

Citizen marketers will sell “remarkable” ideas Innovators should adopt the 1% rule

If you don’t find the “sneezers” or connectors, the 80/20% rule won’t matter

Work backwards Build your brand around your idea first. If the community you are targeting does

not coalesce and rally around the idea, continuing to build the product is irrelevant

Create your own “blue ocean” If you play it safe and go by the rules of your industry, value chain, and business

model – you’re dead! Most industries and markets are saturated and highly concentrated.

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Old 4Ps Paradigm

4Ps

Value Creator Customer

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New Paradigm

4Ps

Value Innovator Customer

Product

Brand

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Source: Mohanbir Sawhney, & Deval Prikh (2001). Where value lives in a networked world. Harvard Business Review, HBR #R0101E.

New Value Innovation Paradigm

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It’s About Social Behavior It’s not about a cheaper product or your idea. Try to

change customer behavior. It’s not about better coffee – it’s about the place I am not looking for a ¼” drill bit – I need to make a hole It’s not about the hog, it’s about a lifestyle It’s not about the sound – it’s about how it makes me feel It’s not about the sound – it’s about being hip It’s about my space It’s about my video It’s about my opinion It’s about the experience It’s about your choices, places, and time

Examples Apple, Starbucks, JetBlue, MySpace, Harley-Davidson, Tivo,

Stew Leonard’s, Threadless

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Implications Reached the tipping point The static web maturing Monologue marketing out Live Web (a/k/a Blogosphere) is making information

transparent Word travels fast People are more likely to act on a peer’s recommendation

by factor X Marketing is a reflection of social paradigms The new social media and networks changing customer

expectation and behavior