Trends Overview, Session 1

Digital Marketing: Engaging with the Customer

Trends Overview
MANG3052
Lisa Harris
5 th February 2010

Plan
Module structure and assessment
Ning, job vacancies, IDM Summer School
Digital trends and their impact on marketing
The big picture
How marketing is changing
The role of RSS
Exercises/videos will be inserted where relevant...

Institute of Direct Marketing
www.theidm.co.uk
www.theidm.co.uk/studentcomp (deadline end Feb)
Summer School (Free, but entry is competitive) Ist week of July.
Award of IDM Certificate to top up your degree with one additional exam (subject to approval)

Trends in technology
Did you know 4? (5 mins) http://www.youtube.com/watch?v=6ILQrUrEWe8
10 Years of changes in technology, BBC report by Rory Cellan-Jones (3 mins): http://news.bbc.co.uk/1/hi/technology/8434373.stm
http://www.youtube.com/watch?v=CPIbGnBQcJY (Project Natal Milo, 4 mins)
http://www.youtube.com/watch?v=jDi0FNcaock (Future of Shopping, Cisco, 1 min)

“ Change we can believe in ”
$28m average raised per month in online donations during 2008
92m views of display ads per month
2.2m site visitors per month
9.8m video views on YouTube
5,455,665 supporters of the Obama Facebook Group
285,467 followers on Twitter

Role of Web 2 technologies
a ‘net generation’ culture is emerging based on:
decentralised authority rather than hierarchy and control
online socialising and collaboration
user generated and distributed content (expert endorsement, product ratings, spoof videos etc)
open conversations, peer-to-peer sharing and global participation in communities and networks
We will be investigating these points in more detail in Week 5

Internet technology has changed the world
Years it took to reach an audience of 50 million:
US Dept Commerce Radio 50 years TV 13 years Internet 4 years iPod 3 years 2 years 2 years 1 in 8 marriages in US now as a result of online dating.

Internet usage European average source: EIAA 2009 Time spent online per week Hours 12 Hours 8.8 Hours Proportion of heavy users (16+ hours per week) Percent 28% 17% Weekend use Percent 51% 39% +36% growth +65% growth +31% growth

Using the Internet is becoming natural…
“ Digital natives” (Generation Y)
>Age 18-30
>have grown up in the digital age and technology is embedded into everything they do
>More likely to be online than watch TV
“ Digital immigrants” (Generation X)
>Age 31-44
>have adapted their natural behaviour and learned to use technology for its convenience and benefits
In practice, there is as much difference WITHIN the generations as there is BETWEEN them

www.rubiconconsulting.com , September 2008

Digital marketing isn’t just the Internet Microprocessors are going into many different devices ...and 3 screens are now becoming mainstream... When I want it and Where I want it.

Touch screen mobiles are becoming popular ...and so will Internet video on mobile devices...
Its not so much the iPhone but the large touch screen that has produced the first
usable Internet
browsing mobile
device...
...and 3G “all you can eat” connections. UK phone networks forecast that half of UK will have large screen Internet mobile phones within four years.

Digital is different...it’s interactive ... Product, Content, Advertiser & Consumer Broadcast Interactive Single platform Multiple media platforms Publisher timetable My timetable Passive Engaged Mass Targeted Interrupt Relevant Advertiser control Consumer control 30 seconds Extended time Digital interaction is changing marketing from a top down process into a bottom up process. Currently UK Marketing spend through digital channels is 25% of total Marketing budget. source: eConsultancy 2009 In the next two years 50% of spend is digital: GM will dedicate half of its $3 billion budget to digital and one-to-one marketing in the next two years...

Consumers are way ahead of businesses… John “ ...I have ordered stuff from America just to save £2."

The Internet has changed purchase behaviour
Google’s UK ad revenue was £1.9 billion in 2008 – ITV’s TV ad revenue was £1.5 billion
Google has the highest awareness of any brand in the world (Nielsen 2009) – without any advertising
3.9 billion Internet searches in the UK in a month (ComScore June 2008)
1999 Google.co.uk 2009 Google.co.uk

Online Retail Trend Choice... “ ...the activity and processes for creating, communicating and delivering offerings that have value for customers...” High Street store typically stocks 800 lines Good Online Retailer in 2009 typically stocks 18,000 lines Good Online Retailer in 2010 will stock 30,000 lines

Smartphones
http://www.youtube.com/watch?v=Vo0Rmd8mous (SAP real-real time computing, 2 mins)
Majority of US users will have smart phones by mid-2011 (Nielsen research)
Market leader is Apple’s iPhone (90%) with Google’s Android a recent market entrant
92% of Android and 88% of iPhone customers use them to access Internet services

Touch screen mobiles are becoming popular ...and so will Internet video on mobile devices...
Its not so much the iPhone but the large touch screen that has produced the first
usable Internet
browsing mobile
device...
...and 3G “all you can eat” connections. UK phone networks forecast that half of UK will have large screen Internet mobile phones within four years.

Growth of smart phones

Mobile phones and barcodes
Take photo of a product barcode
Phone scans blogs for customer reviews and websites for best price and produces a report
Implications:
More power to the consumer
Vendors need to create product review blog and incentivise key customers to contribute
They need to index with search engines

http://www.youtube.com/watch?v=2vS3R2u7sXA (intro to QR codes, 3 mins) www.creativesearchmedia.com

Terminology
‘ E-commerce’: the buying and selling of goods online
Online Marketing/Digital Marketing:
‘ Applying digital technology to profitably acquire and retain customers (through a multi-channel buying process) through improving our knowledge of customer profiles, behaviours, value and satisfaction drivers, then delivering targeted communications and services that match their individual needs.’ (Chaffey, 2006)
‘ E-business’: electronic interaction with a range of stakeholders, such as suppliers, agents, customers, employees, partner firms

Multi-channel marketing
PC-based Internet
Retail stores
Telephone call centres (eg customer services, technical support)
Mobile internet
Interactive TV
Social media
Virtual worlds

How online marketing is changing Web Site Google Adwords Overture Download Free Info Details to Database Email Offers / Ezines Enquiries Sales Networking PR / Blogs Retail Route Consultants Route

Trends in marketing spend 2008 -9

Online advertising spend overtakes TV (October 2009)
Spending on online advertising grew 4.6% in the first half of 2009 compared with the same period last year to reach £1.75bn, driven largely by search engine advertising.
By contrast, overall advertising spending fell 16.6 % As a result, online’s share of the total grew from 18.7% in the first half of last year to 23.5%, ahead of TV’s 21.9%
Recession has accelerated this trend

A few statistics…
70% of UK population now online (OXIS 2009)
94% of these access Internet via broadband, which is a key driver of growth in video download and sharing ( www.iabuk.net )
Use of mobile internet access devices has doubled since 2007 (OXIS2009)
Google’s advertising revenue now exceeds that of ITV
78% of digital video recorder owners claim to ‘fast forward’ through advertisements (Ofcom, 2008)
Spend on online advertising in the UK now 19.2% of total spend in 2008 (up from 15.5% in 2007) according to www.iabuk.net
Overall advertising spend declined by 3.5% in 2008
Online sales in Oct 2008 now 4% of total (since Oct 07, high street sales have fallen 2.2% online sales have risen 16%) according to the British Retail Consortium www.brc.org.uk

Total UK expenditure on advertising 2008

The online advertising market in 2008

EMC Community

Amazon lead the way in data management Google ads: Improvements in relevance Amazon.com recommendation engine: Leveraging data Source: Amazon.com, Google What other customers are thinking What other customers are buying What other customers are doing What other customers are saying

Really Simple Syndication (RSS)
‘ A way to format regularly changing content, enabling it to be shared with individuals and other Web sites'.
A cheap and easy way of delivering relevant content (such as blogs) to the desktop of customers, prospects, suppliers or employees who have set up the link (“pull” not “push”)
Enables expertise in diverse locations around the web to be integrated and showcased

RSS (really simple syndication)
Allows you to pull the latest content from specific sources as it is created
http://www.google.co.uk/ig
http://uk.youtube.com/watch?v=0klgLsSxGsU
Allows you to keep up to date with content as related to dissertations, projects, etc

Examples of RSS linkage
Microsoft Facebook Fan Page http://tinyurl.com/bqq8lo
Online graduate CV http://guywithideas.com
Wearesocial: “ We are a conversation agency. We help brands to listen, understand and engage in conversations in social media ”
www.wearesocial.net

From ‘traditional’ to ‘new’ media
From ‘push’ to ‘pull’
From monologue to dialogue
From ‘one-to-many’ to ‘one-to-one’
From ‘one-to-many’ to ‘many-to-many’ communications
From ‘lean-back’ to ‘lean forward’
Increase in communications intermediaries (portals, search engines and specific online communities)
Integration of ‘old’ and ‘new’ media in creative ways can help a business to stand out from the crowd

Summary
Online marketing appears to be less affected by recession than traditional marketing, and may even benefit from reduced marketing budgets and the consequent switching that occurs
Trend is towards interaction and engagement between business and customers, facilitated by web 2.0 tools.
This also allows customers to engage with and learn from each other
Companies can no longer control the content of their message, but can influence the dialogue to some extent
Growth of RSS facilitates ‘pull’ rather than ‘push’

Reading/Watching
5 outstanding leaders in YouTube marketing: http://mashable.com/2009/06/01/youtube-brands/
Four ways that social media is changing business: http://mashable.com/2009/09/22/social-media-business/
How social media can make history, by Clay Shirky http://tinyurl.com/nmeo3o
For more, check out what I am reading and saving on www.delicious.com/lisaharris1

Thank you!
You are welcome to follow me on any of my social media sites:
www.lisaharrismarketing.com
www.delicious.com/lisaharris1
www.twitter.com/lisaharris
www.linkedin.com/in/lisajaneharris
www.slideshare.net/lisaharris
Next week we will cover consumer behaviour and e-retail

Trends Overview, Session 1

by lisa harris on Feb 03, 2010

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