Know Your Market,
Know Your Customer…
…and pull.

Know your Market…
Varied Core Values and Varied lifestyles
Source: Ed Monahan, Kodak, June 2008
Span Age Population Lifestyle Signature Core Values
Cyber life Authorship
1979-1991 16-29 74M Technology Autonomy
Immersion Authenticity
Social Deviation Savvy
1965-1978 30-43 62M Radical Games Diversity
Frantic Pace Entrepreneur
Affluence Individuality
1946-1964 44-62 78M Conformance Self Absorption
Traditions Youthfulness
Patriotism Duty
1909-1945 63+ Honor Victory
Work Ethic Teamwork

Know your Market…
Portrait Activity and Pricing Changes
US Portrait Market Overview as of Q1 2005
111.4 M Total US HHs UP from 105.4 M total Us HHs in 2001, UP 5.7%
42.6 M Portrait Active HHs DOWN from 42.9 M portrait active HH's in 2001, D .6%
38.2% US HHs are Portrait Active DOWN from 40.8% US HHs in 2001, DOWN 6.3%
116 M Portrait Sittings annually DOWN from 123 M in 2001, DOWN 6%
Ave 2.72 sittings/year per active HH DOWN from 2.96 sittings per yr in 2001, DOWN 8.1%
Annual Portrait expenditures = $7+B Prices UP from 6-21% from 2001 averages
HHs with children , 6 years old
and with incomes > $50,000
are the most portrait active
Source: Ed Monahan, Kodak, June 2008

Know your Market
 The Long tail is here
– The mass market has turned to many niches
– The mass market has turned to niches without end
– The mass market is not as massive

Know Your Market…the long tail
Dec 2005, The Long Tail
 Rhapsody; top 4,500 albums for 25,000 tracks, accounts for 60% of sales
 Wal Mart: carries 4,500 albums, top 200 albums account for 90% of sales

Know Your Market…the long tail
Dec 2005, The Long Tail
 Rhapsody: songs not found but in a few specialty record stores
 Rhapsody sales: approx 22 million downloads per month, = $25% of total sales

Know Your Market…the long tail
Dec 2005, The Long Tail
 Rhapsody: songs not found but in a few specialty record stores
 Rhapsody sales: approx 16 million downloads per month, > 15% of total sales

Know Your Market…the long tail
Dec 2005, The Long Tail
Sales of products not offered in brick & mortar = 50% total sales
Bottom line: A very large # of products x small # buyers = a lot of money

Know Your Market…the long tail
Dec 2005, The Long Tail
Bottom line: A very large # of products x small # buyers = a lot of money

The long tail
is e-tail
 The long tail is the dominate provider
of niche products
 Fastest growing products are products not
available in brick and mortar box retailers
 The consumer can find anything on the
internet at a good price

Know your Market: Summary
 Next 10 years Gen X & Y turn 40, peak earning and spending years
 Current consumers have varied core values
 Consumers values and expectations are shifting
 Consumer practices are shifting
 All segments of US Portrait market are on the decline
– Total US HHs increased
– Total US Portrait active HHs decreased
• Ave sittings/year per portrait active HH decrease
• Annual portrait spending increased 1+ Bill
• Prices increase 6-21%
– HHs w/children under 6 years w/incomes >$50,000 most portrait
active
 Long Tail has arrived
– Abundance of products is king
– Abundance of image sources resets expectation of
portrait values
 The economy is forcing pricing
pressures on all discretionary
spending

Know your Customer
Customer Expectations

Customer Expectations
2006 Lisa Johnson, Mind Your X’s and Y’s

– 10 cravings of new connected generation of customers
– Referenced her analysis all on existing market players
– Referenced her analysis in social and economic stats
• Napster software for free file sharing and download
• E Bay offer of on-line auction
• Cable news and websites reduced news cycle
• Blog writers gained full media credentials at conferences
2007 J H Gilmore & B J Pine II,

What Consumers Really Want: Authenticity
– Referenced analysis in marketing consulting
case studies with Harvard University in media,
entertainment, commodity industry

Customer Expectations: Shine the Spotlight
– James Soda: launched 1997, sold beverages
• Labeling, changes photographs to customers images sent in
• 12 pack, custom labels & caps, $34.95
- US Army: 2004: launched “Avergam”
• Participants select interest and weapons
• Made recruiting goals every year there after w/in negative
political climate
– Play Station 2: digital camera superimposes video
graphics onto game
• Viewer becomes the central figure in the game.
• Still in business, Mattel has left.

Customer Expectations: Shine the Spotlight
 Customers are eager for personal recognition
– Sense of entitlement…”to get what they deserve”
– Every industry has its celebrity, i.e., Iron Chef, Choppers,
Interior Design
 Customers want dreams legitimized, i.e., Let’s Make a
Deal, Dancing with the Stars
 Customers want experiences legitimized, i.e.,
Reality TV shows, American Idol
– Every person feels special
– Every person feels the center of his
universe

Customer Expectations: Make Social Connections
Urbanites redefining “Adultlescent” years

– X & Y extended single years before delayed marriage
– Circles of peers important, i.e., Friends, Cramer
 Starbucks worked w/Microsoft for wireless network w/in stores
– Customer interested in vanilla latte & 3rd place to work
– Starbucks has become the model for McDonalds TV, Barnes & Noble
 Facebook: Feb 2004, social networking site for Harvard University
– Feb 2005, largest post secondary social networking web site
– Jan 2006, Launched High School version of Facebook
• End 2006, 9th over all website for internet hits
• College Directory logs > 250 million pageviews w/in 24 hour period

Customer Expectations: Make Social Connections
 People Seek friendships
 People seek loose connections that fit their
lifestyle
 On-line communities reset rules of social
interaction

Customer Expectations: Shift Through the Clutter
 Stuart Hunter bike store
– Stores with 100+ bikes on floor, prices & types, national cycling market was
stagnate
– 2005 open “Roll…a bike store for the rest of us”
– 4 bike categories; road, mountain, trail, & family
– 18 product styles…all only 4,000 sq ft.,
– Perfect fit system; laser scanning to measure key places on the person
 Chipotle Mexican Grill, 1993 serves 2 items, tacos & burritos
– choice of fresh ingredients everyday…tortilla, beans, meats, grilled veggies,
guacamole, cheese, sour creams, 3 types of salsas…the customer can select
his own
– Customer selects his own, from what he knows is fresh & quality
– 2008, 500 plus locations in US

Customer Expectations: Shift Through the Clutter
We want Speed and efficiency…the range of choices tailored to

fit our needs
– Specialty warehouses, appliances, flooring, furniture, food,
– Come on in. Let us build something together
We trust our experience versus the advertising claim…

technology allows personal selection
We respect experts to provide navigation…we don’t have the

time or knowledge to do all the due diligence

Customer Expectations: Pull… No Push
Advertising model used to be: Big, Loud, and often…17

repetitions to gain recognition
 People are saturated with push advertising and false claims.
 GM vs. Japanese automobile industry
– GM: manufacture cars, as many dealership as possible, push cars
– GM: marketing: primarily come get these cars at a good price
– Toyota: manufactured models for display & as the customer ordered
– Toyota: markets primarily on product quality benefits to the customer
Scion…3 different vehicles, Euro Sedan, Urban SUV, Suburb

Sports
– 2004: 1st yr in US Toyota sold 20% > Audi
– 2004: 85% of customers were 1st time buyers

Customer Expectations: Pull… No Push
 Customers are saturated with push claims
 Customers want control
 Customers are weary of invasive selling

Customer Expectations: Build it Together
Internet is an information free for all

– Medical research, breaking news, Auction sites (EBay),
Wanted sites (Craig’s list), GPS, Maps/Directions,
White/Yellow pages, Wikipedia, Family Tree sites, Lost
Persons Locators, Dating/Matching sites
– Connected citizens use their creative power and influence
the market
– Internet surfers have moved from being passive observers to
active participants.

Customer Expectations: Build it Together
 Wikipedia: launched Jan 2001 as open forum
– 200 articles in English
– Nov 2001, 18,000 entries, not all in English
– 2005, 790,000 English entries, > 13,000 active contributors
• > 1.8 million articles, > 100 different languages
- 2005, 10 multi-lingual sites with > 50,000 articles each
Craig‟s List: launched 1995 for San Francisco Bay Area

– > 2 billion page views per month (2006)
– > 8 million unique visitors per month (2006)
– > 80 countries in the world (2006)
 Napster: > 100 million share music and
films on-line
 EBay: 10 years after started, 68 Million
users, Revenues > 6 $B
 My Space: Feb 07, fastest growing
community in the world
 Blogs: Approx 10 mill blogs read by 32
million Americans

Customer Expectations: Build it Together
Collaborative…consumers are willing to create content

w/o reward
Connected…consumers have more access to more

information
Communities…consumers are comfortable with on-line

strangers and online communities

Know your Customer
Customer Cravings

Customer Cravings…Authenticity
 2007 J H Gilmore & B J Pine II, What Consumers Really Want:
Authenticity
– Referenced analysis in marketing consulting case studies with
Harvard University in media, entertainment, commodity industry
– References sociology, economics, business development models
– Work is highly annotated in establishing its factual basis
 Summarize the Cravings and draw applications to professional
photographer

Customer Cravings… Natural Authenticity
 Starbucks, Bass Pro Shops, Organic Foods, Whole Foods, etc.
– Starbucks interiors, earth tones, functional furniture,
aromas…authentic
– Organic foods, $12 B industry, growing at > 20% year in sales
– Big Box Retailers organic selections
 Customers are seeking that which respects nature
– Material, solid, & real
– Leave it raw…not polish, clean shaven,
– Reek rustic…actually used
– Be bare…nothing is more natural
– Be green…respects the environment

Customer Cravings… Originality Authenticity
 Admiration of all forms of art,
 New/Same products & services, Uncola, Geek Squad, Cheerios
 New reality TV shows, Great Race, Extreme Make Over, Millionaire Bachelor, etc.
 Customers seek a sense of originality in the market place
– Stress first…there is little value of “me too” products
– Revive the past…there is much to respect of our real heroes
– Look old…after all old has worked and is real
– Mix-Mash…stimulate a sense of discovery, scrapbooks
– Anti-up…what is most important

Customer Cravings… Exceptional Authenticity
Customers are looking for the unique or unusual

– Ritz Carlton…no one’s perfect, just exceptional
– SW Airlines…one executive investigates consumer complaints and personally answers
each customer with a reply which includes humor
– Harley –Davidson special design for police officer and firefighters
– Personal trainers and coaches
– Regent Seven Seas Cruises…themed enrichment programs w/in cruses
– Mass customizing to yield one of a kind…Anderson Windows
Customers are seeking something exceptional in the marketplace

– Business to be different, to be frank
– Respond to the individual customer
– Go slow, to allow my time of
contemplation
– Foreign, something that has never
been seen before

Customer Cravings… Referential Authenticity
Offers that honor some previous place, object, person, event, or idea
Las Vegas…Bellagio, Italy, along lake Camo
Luxor, ancient Egyptian city,
Mirage, Volcano,
Embedded advertising…beers, cigarettes, shoes, guns in movies
War Games, Call to Duty 2, Brothers in Arms, go to great lengths to add actual historical
images
Video games…Ex-Military personnel serve as consultants in game development
Customers are seeking something that references them to something
Personal tribute
Something evolved over time
A particular place
Something better than …
Something more real than…

Customer Cravings… Influential Authenticity
Customers seek to be influential…How will this purchase influence me or

others for the better?
 An offer that will alter some person(s) positively is more authentic than an offer
that does not impact some cause
 To purchase with this offering always involves something beyond the qualities of
the item purchased
– Pesticide free fruit, whole grain bread, edible eggs
– Benefits the Hospital, Half Way House or Habitat for Humanity
 Customers respond to
– Appeal to personal aspirations
– Appeal to collective aspirations
– Art
– Promoting a cause
– Giving meaning

Know your Customer
Internet Active

Internet Active
Pew Internet & American Life Project, Dec 2007
Total Adults Total Adults
Women 74%
Men 76%
Age Age
18-29 92%
30-49 85%
50-64 72%
65+ 37%
Household Income
Less than $30,000 61%
$30,000-$49,999 78%
$50,000-$74,999 90%
$75,000+ 93%
Educational Attainment
Less than High School 38%
High School 67%
Some college 84%
College+ 93%

Internet Active
Pew Internet Research Foundation Posting
Internet Activity July „08
 33% Internet Users, 24% read blogs w/in past 30 days
 11% internet Users, read blogs on a given day
 5% Internet Users blog on a given day
 50% Men read blogs
 38% Women Read Blogs

Internet Active
Direct Marketing Association, Oct. 24th 2008
35% of email recipients open email on the subject line alone.

21% of email recipients report email as Spam, even if they don’t know it Is not spam

43% of email recipients click the Spam button based on the email “from”, or based on

the email address
69% of email recipients report email as Spam based solely on the subject line

17% of American create a new email address every 6 months

44% of email recipients made at least one purchase last year based on a promotional

email
Subscribers below the age of 25 prefer text messaging to email

35% of business professional check email on a mobile device

People who buy products marketed through email

spend 138% more than people that do not receive
email offers.

Internet Active
International Association for Wireless Telecommunications, The Wireless Association, Nov. 2008

Internet Active
International Association for Wireless Telecommunications, The Wireless Association, Nov. 2008

Internet Active
Mobile Messaging
From: Mobile Marketing Forum, Mobile Messaging Association, Nov. 2008
 March 2008:
– American Pop 1 Hr 39 min/month on Craig’s List = 3.3 minutes per day
– American Pop 1 Hr 45 min/month on Facebook = 3.5 minutes per day
– No. of Americans browsing increased 89% over past 12 months
– No. of page views increased 120% over the past 12 months.
 June 2008:
– American Population spent 4.5 hours/month browsing internet with
Smart Phone
That’s = 9 minutes per day

Internet Active
Average No. Monthly Calls & Text
Messages
400
350
Ph o n e
300 Calls
250
200 Text
150 Messages
100
50
0
Source: Nielsen Mobile

Internet Active
Average No. Monthly Calls vs. Text Messages
2000
Calls
1500
1000
Text
Message
500
0
s
r
+
7
4
4
4
4
Ag 64
e
ub
65
-1
-2
-3
-4
-5
nd
-
13
18
25
35
45
55
lS
es
U
Al
es
es
es
es
es
es
&
12
Ag
Ag
Ag
Ag
Ag
Ag
Source: Nielsen Mobile

Know your Customer
 The Internet is an integral part of consumer
purchasing
– More choices, More Information, Information Filters,
– No market is closed, rather
– Expectation is that information and images will be shared
 The internet is the epicenter of the young consumer
– Social networks, online communities and web entertainment
shape decisions
– Value is redefined in terms of flexibility, control, and
convenience.
 The internet is becoming a
personal expression tool
– Customers Expect Customization
– Customers Crave Authenticity

Know Your Market,
Know Your Customer…
…and pull.

…and pull
“ Don’t be so pushy…
…understand your customer and pull”

…and pull
The Role of Marketing is NOT…
– to undercut the competition.
IT IS…
– to create and keep customers.

Push Marketing…
… pushes the product or service at the customer.
… drives emotional or rational triggers to close a sale.
“Dirt Cheap. The last resort for the persecuted smoker. All the beer, liquor, cigarettes you’ll
ever want Dirt Cheap. At I 270 and XXX, I-70 and ____ , and I44 and ____”
“Come to Rothamn Furniture. Zero Interest, O Down, no payments till 2010. Sofas,

recliners, bedroom suites, dinning room suites. You name it we have it while supplies last.”
“John Doe’s Ford has the SUV and truck you need. Zero interest, zero down, $3,000 rebate

and we’ll get financing even if you have bad credit.”
“For the price of a night in, how about a night out. 2 for $20 at Appleby's…something’s good

in the neighborhood.”
“50% off all tools for Dad. now thru December 14th”

“60% off all Christmas decorations, while supplies last.”


Pull Marketing…
 solicits a positive emotional response in the consumer that pulls
the consumer to your product or service.
 emphasis supplying exactly what the customer wants.
“ I love you man, but you can’t have my Bud Lite”
“ Crisp, clean, cool, from the mountains of Bush Beer”
“ Home for the holidays with the King of Beers” Budweiser
“You can do it. We can help.” The Home Depot
“Come let us build something together.” Lowes
“The world’s best ham is ready for your place…” Honeybaked
“Every Kiss begins with Kay” Kays Jewelers

Market Response to Consumers Expectations
Market Response
Shine the Spotlight
- Encourage self expression
- Eager for personal recognition
- Images of future dreams
- Want dreams legitimized
- Images of experiences
- Want experiences legitimized
Market Response
Make Social connections
- Encourage group sessions
- People seek friendships
- Advertise with lifestyle vendors
- People seek loose connections in lifestyle
- Encourage blogs, MySpace
- Communities reset rules
Market Response
Sift through the clutter
- Packages and choices tailored to needs
- Long tail is here…infinite choices
- Session consultation, expiration dates
- Speed and efficiency
- Each session a memorable experience
- Trust their experience vs. “the claim”
- Recognize your
- Experts provide navigation experience & filter
unnecessary
images

Market Response to Consumers Expectations
Market Response
Push… No Pull
- Pull statement for each
- Saturated by push and false
- Allow for previews online…
claims promotion
- Do not need to preced the sale
- Consumers are used to being in - Multiple opt-in, opt-out options
control
- Weary of invasive models
Market Response
Build it Together
- Encourage peer created images
- Collaborative - Popular demand… extends the offer
- Connected - Sever communities, cause marketing
- Communities

Market Response to Consumers Cravings
Market Response
Consumer Cravings
Natural Authenticity
Natural Authenticity
- Outdoor settings
- Material
- Natural settings
- Raw
- On location settings
- Rustic - A view from the top, end, bottom, etc.
- Brave - Old gas pump, with ear of corn
- Green
Originality
Originality
- Variety of props
- Firsts - Cell phone/phone booth
- Revive the past - Sepia, textured, soft, etc.
- Look old - You tell me what you want
- What is the most important
- Mix & mash
- Up the anti

Market Response to Consumers Cravings
Market Response
Consumer Cravings
Exceptional
Exceptional
- Interview client
- Different
- What is most important?
- Frank, blunt
- Time to feel w/the client
- Slow - What have we never seen?
- Foreign
Referential
Referential
- Who do you most admire?
- Personal tribute - Senior memorial CD
- Evolve over time - What is most important moment?
- What do you want to make better?
- Pick a place
- Better or realistic
Influential
Influential
- Looking to the future
- Personal aspiration - Family w/child, senior w/friends
- Collective aspirations - Excellent composition
- Art - Charity session fee
- Promote a cause
- Promote a cause
- Give meaning

Pull Marketing…
 MTM must adjust to consumer expectations and cravings
– Business/promotions must recognize universal expectations
– Branding must appeal to fundamental cravings
– Promotions must pull from fundamental cravings
 Promotion copy needs to highlight a pull message
 Promotion copy needs to have the portrait offer
 Promotion copy needs to have the expiration
 Promotion copy needs to high light a pull message for the target
consumer

1st Quarter Action Plan
 Enlist studio staff and management
 B/S Consumer Expectation Matrix
 B/S Consumer Cravings Matrix
 Decide on 1st Qtr Promotions
 Insure each promotion has pull copy
 Complete a studio tasking inventory
 Apply fiscal management principles

Know Your Market,
Know Your Customer…and pull
“ In every adversity you find
the seeds of opportunity”
Lisle Ramsey,
From W Clement Stone