Social Web

Slide 1: The Social Web why brands must listen, learn and act Presented by: Mike Spataro

Slide 2: Our World at Warp Speed here’s what happens in one second….. 7 PCs are sold 9 people logon the Web for the first time 25 cell phones are sold 257 search engine queries occur 1157 videos are viewed on YouTube 2 million emails are sent

Slide 3: …And We’re Just Starting 1 billion people online 6 billion people to go there is as much content on YouTube today as there was on the entire Web in 2000

Slide 4: MeMedia Generation EMAILS ONLINE BLOGS ITUNES RADIO 1.8 billion SEARCHES 1.2 million PODCASTS 327k of daily sent daily 200 million daily created daily 2,000 hours hours airtime available daily MYSPACE MAGAZINES 50 million 14,703 articles daily visitors daily TV VIRTUAL 42,000 hours WORLDS daily 672 hours daily MOBILE TEXT INSTANT NEWSPAPERS ITUNES PHONE MESSAGES MESSAGES 72,800 daily VIDEOCASTS SUBSCRIBERS 260 million 5 billion daily columns 200 hours 388 million daily daily hours daily

Slide 5: The Consumer-Generated Media Era 44% of U.S. online adults are content creators” (Pew Research) CGM is the fastest growing segment of the Web, with more than 1 million new articles of content posted every 24 hours.

Slide 6: Fad or Force? Top 10 Innovations of past decade…. 10 BlackBerry introduced (1999) 9 iTunes (2001) 8 Consumer-Generated Content (2005) 7 WiFi (802.11 launched 1997) 6 Open Standards (HTML 4.0 released 1997) 5 Google Ad Words (2000) 4 Amazon.com (IPO May 1997) 3 eBay (launched September 1997) 2 Broadband Usage of US Internet Users Reaches 50% (2004) 1 Google (1998) The Software and Information Industry Association (SIIA)

Slide 7: CGM Trends Up 100% percentage of online users 26% 80% 38% 55% 57% 13% 67% 60% 20% 40% 20% 61% 22% 19% 20% 42% 25% 20% 15% 0% Ages 18-24 Ages 25-34 Ages 35-44 Ages 45-54 Ages 55+ Creators Readers Asocial users

Slide 8: Feed the Beast worldwide users of consumer-generated content (millions) 2006 128.0 2007 147.5 2008 169.7 2009 195.7 2010 225.8 2011 253.6 NOTE: includes video, audio, photo sharing, Blogs, Wikis, Podcasts and online bulletin boards Source: eMarketer, June 2007

Slide 9: Consumer Profiles In Social Networks Passive Active grazers contributors spectators creators browsers raters & responders passive audience is much larger than active one

Slide 10: Global Blog Readership Russian 2% German 1% French 2% Farsi 1% Portuguese 2% Italian 2% Spanish 3% Chinese 11% English 41% Japanese 35%

Slide 11: Social Media Landscape personal / self expression Social Networking Viral Pass CGM Along Virtual Wikis private Feeds Communities public Social Book Content Marketing Rating Professional Networking Tagging utilitarian

Slide 12: Intersection of Top-Down and Peer-to-Peer Traditional • Regulators top-down model • Experts T • Investors A • CEOs Horizontal L peer-to-peer K model ENGAGE Sweet Spot • Bloggers • Passionate Consumers • Employees The ability to play between the two 12

Slide 13: Word of Mouth Rules

Slide 14: Most Trusted Spokesperson 2003 2007 “Person like you” 22% 51% CEO 14% 22% Academic 43% 48% Regular 26% 36% employee Decline of authority figures Source: Edelman Trust Barometer 14

Slide 15: Social Networks Trump Other Media Social networks have caused a fundamental shift in the way people interact with each other. More than 70% of Americans 15 - 34 actively using online social networks. Source: Fox Interactive Media

Slide 16: Social Consumers Buy More “One in three Internet users say purchase decisions swayed by social content“ -- Jupiter Research

Slide 17: Real Business Value consumer opinions are the most valued consumer tools in a crowded marketplace brands need: The Internet has already surpassed insight into what consumers are saying television as the \"most essential\" awareness in social media networks medium by excitement for products people 12 – 44. to engage with audiences Edison Media Research

Slide 18: Corporate America Needs Social Media “does business act responsibly?” 70% 70% 60% percentage of 50% respondents 40% who said 30% “yes” 20% 30% 28% 10% 15% 16% 0% 1968 1976 1985 1999 2006 “Yankelovich, CNN/USA Today, and Gallup

Slide 19: Redefining Influential Sources top 100 news sources

Slide 20: Mainstream Media Goes Social consumer interaction

Slide 21: Social Media Travels Fast Engadget knocks $4 billion off Apple market cap in six minutes on bogus iPhone rumor

Slide 22: Social News Gathering more than 2000 “editors” as the tragedy unfolded

Slide 23: The Future of TV Debates? best media for learning about a presidential candidate’s position on election issues according to US adult Internet users, March 2007 (% of respondents) 25.0% Internet 21.3% TV 17.3% Newspapers 6.9% Radio 4.4% Magazines 3.3% Pamphlets, brochures or direct mail implications: political, health, education, entertainment – all being impacted

Slide 24: Syndication of CGM Influence blog content syndicated to online msm

Slide 25: Social Networking Goes Professional social banking and healthcare

Slide 26: Social Media Process marketers need to find the right entry point to engage appropriately a social media dialogue 1 join 2 listen 3 learn 4 participate 5 share 6 evaluate trust needs to increase with marketer engagement

Slide 27: Interactivity Engine Participation Line Conversational Conversational Communication Conversational Collaboration Conversational Line Controlled Controlled Communication Collaboration Controlled Communication Collaboration Talk Action Continuum 27

Slide 28: You Can Run but You Can’t Hide “Whether or not we choose to be part of the dialogue, the dialogue is going to happen,”… “I believe the challenge is to make happen with us.” -- Coca-Cola’s Tim Kopp “Consumer-generated media … are siphoning attention from traditional media and creating networks of influence among consumers” -- Forrester’s Brian Haven

Slide 29: “2.0” is Really About … people = participation Source: David Armano, Logic + Emotion

Slide 30: You Have Two Choices Join the conversation…. ….or procrastinate and then join the conversation later on anyway….

Slide 31: Conversation Architect Don’t market messages. Create social experiences. Design conversations. …and relationships authentic organic genuine conversational Source: David Armano, Logic + Emotion

Slide 32: Dialogue is Fueling the “Conversation Economy” Conversation Architecture CONVERSATION COMMUNITY RELATIONSHIPS AFFINITY

Slide 33: Brands & Bandwagons “SELLING AND TELLING is defunct; gone forever. With the increase of consumer- generated media … consumers are showing a greater need for making connections with other people and brands” Source: James R. Stengel, Global Marketing Officer for P&G

Slide 34: Engaging Local Customers Members: 55,986 In preparation for the launch of Infiniti’s new G37 coupe, the brand introduced Threads: an employee, nicknamed Infiniti Michael, to engage with online car enthusiasts and provide them with exclusive information about the coupe. By generating 163,250 excitement among and developing long-standing relationships with key Posts: influencers, Infiniti shifted the tone of the buzz from neutral to overwhelmingly 2,217,903 positive. 34

Slide 35: Dan Entin Had a Problem Unilever employee Mike Fortner emailed Dan suggested ways for Dan to find store locations sent Dan a case of Degree Sport deodorant Dan blogged it and became brand advocate

Slide 36: The Influencer Network is Changing MEDIA EDITORS BLOGGERS BLOGGERS CONSUMERS JOURNALISTS PUBLISHERS ADVERTISERS “Consumers turning to each other online is not a fad anymore. Companies opening up to customers isn’t that different from the risks associated with doing business every day,” -- Forrester Research

Slide 37: So What’s the ROI Social Media ROI = return on influence

Slide 38: CGM Business Intelligence

Slide 39: Social Media Challenges for Brands transparency uncontrollable environment consistent immediate participation size and scope of the channel role of employees in the community

Slide 40: When in doubt… follow the money Looking to spend differently Johnson & Johnson’s US ad spending for the past two years In millions of dollars Percent change Media 2006 2005 Decrease Increase Television 862.7 1,128.5 -23.6 Magazine 355.9 415.1 -14.3 Radio 39.5 41.1 -4.0 Internet 34.1 24.8 +37.7 Newspaper 13.2 15.4 -14.3 Outdoor 0.8 2.3 -62.6 Total 1,306.3 1,627.2 -19.7 Note: Doesn’t include spending on the recently acquired Pfizer consumer health-care brands Source: TNS Media Intelligence

Slide 41: and if all else fails…