Razorfish outlook report 2011 (vol10)


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Razorfish outlook report 2011 (vol10)

  1. 1. outlook report VOL 10
  2. 2. 4 Outlook Report, Volume 10 — There’s no better time to start something. 6 The Year in Media 14 Forget Mobile — Think Multiscreen 22 A Wake-Up Call for Collaboration 28 It’s Time for Big Data to Improve Customer Experience 38 Humanity Check — What Consumers Really Think About Tech 42 How the Social Cloud Can Accelerate Brand Interaction 50 Beyond the Banner — Unleashing the Power of Digital to Drive Topline Growth 58 The Rules of Gamification 62 It’s Not Enough to Be Liked — Getting Serious About Social 70 Controlling the Retail Environment Through Digital Brand Immersion 78 Performance Marketing Must Die 84 Toward a New Global Digital Agency Structure 90 Limited Time to Prepare for Unlimited Potential of Mobile 98 How the Open API Movement Can Help Your Brand102 Organizing for Digital Success108 Authors and Contributors120 Contact OUTLOOK REPORT | GO TO RAZORFISHOUTLOOK.RAZORFISH.COM FOR AN INTERACTIVE VERSION OF OUTLOOK REPORT, VOL 10. 10 3
  3. 3. There’s no better time to start something.4
  4. 4. 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 digitalmarketing — long the domain of digital agencies and technology companies — is now part of a much broaderconversation about social and cultural change, the global economy and business landscape.In today’s world, social tools that started as communications Finally, efficiency alone won’t move business forward forever.and marketing tools have become conduits for revolution. When I meet with CMOs, CIOs and CEOs around the world,Cloud-based services have finally emerged as viable methods I continue to hear a call for innovation and see an ever-presentfor increasing collaboration and driving greater efficiency. search for sources of incremental revenue. Marketers andAnd the investment world increasingly looks to start-ups business leaders once tasked with spending budgets efficientlyto once again push the global economy forward. are increasingly challenged with identifying new sources of growth, as well as product enhancements.This means digital is now a lot bigger than agencies. In fact,it’s bigger than marketing. It’s increasingly woven into the fabric The truth is, building an agency that fires on all cylinders — highof our business and consumer culture. This inspires us more levels of creativity, innovation, efficiency and technology — is athan ever not only to optimize the status quo, but also to ignite tremendous challenge. But it’s what agencies and great marketinga business movement of sorts. organizations will need to do to survive in the face of change.But how? 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 practicalFirst, there is more pressure on our business to perform than in years past. Why? Aren’t digital agencies supposed to becreatively, stemming from the fact that digital ideas come the predictors of the digital future? There’s nothing wrongfrom more sources than just the agency. Indeed, as the new with dreaming big, but first and foremost, in our view the nextgeneration of creators enters the workforce, we have observed 12 months will be about doing.their natural tendency to put digital at the center of their processand thinking, regardless of their chosen industry or employer. We’re not just talking about the social media explosion, butAs a result, companies like ours have to raise their game also scaling an organization and agency partners to executecreatively to deliver idea-led value to our clients, while creating on a strategy. Not simply checking the boxes of media bestan environment for new ideas to thrive. practices, but leveraging every tool available to plan, buy and measure its effectiveness. Not just accepting the productNext, there is a strong drive to leverage the power of technology experience as it exists today, but using technology to improveto increase efficiency and drive down the cost of marketing customer experience. Not just ideation, but also execution.and doing business. We are seeing tremendous opportunitiesin the media marketplace, with the rise of ad exchanges, analytics As we publish the Outlook Report, we hope it will inspire youand marketing platforms, to do just that. We’re merely scratching to think and act. It’s what we mean when we say Ignite.the surface of what’s possible. Bob Lord Global CEO @RWLORD OUTLOOK REPORT | VOL 10 5
  5. 5. The Year in Media Here’s our annual look at Razorfish ad spend, along with the resultsWRITTEN BY of our media team poll to identify the “Best of the Web” and trendsThe Razorfish Media Team 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 differentSPEND ANALYTICS PROVIDED BY questions to get a directional perspective of upcoming trends. Thomas Sudassy The questions revolved around creativity, performance, quality Media Research and overall general satisfaction. and Publisher Relations LINKEDIN.COM/IN/SUDASSY 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, markingREAD MORE 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 Scan the QR code investment from long-standing clients. After just two years, Publicis Groupe has to explore additional proven to be a great fit for Razorfish and our clients. content associated with this article. 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 OUTLOOK REPORT | VOL 10 7
  6. 6. Content is media. Yearly media billings Spend 4% 200 4% 150 43% 36% 13% INDEX 100 4% SEARCH 4% DISPLAY 50 2011(e) 43% MOBILE 2010 2008 2009 36% SOCIAL 0 NETWORKS/EXCHANGES presented by those evolving behaviors. This is fundamentally 1. GROWTH IN AD EXCHANGES different than simply accumulating reach and exposure through Razorfish has been active in buying through ad exchanges mass media. Our paid media spend was distributed across five since the early days of auction-based display media. We were main channels, illustrating the increasing complexity faced by one of the first agencies to launch a trading desk to directly clients and digital marketing teams. access the growing pool of inventory and have continued A closer look at the distribution of ad spend reveals several to be at the forefront of data integration through the creation emerging trends: of client-side data mart solutions, now commonly referred to as DMPs.8 THE YEAR IN MEDIA
  7. 7. Our continued expansion into the auction-based media Number of publishers vs. number of media partnersmarketplace has resulted in tremendous benefits for our clientsin terms of more effective pricing, better targeting and stronger 1,832ROI overall. As we continue to grow and expand our efforts inthis area, we will be focused on integrating first- and third-party 1,024data to build the most sophisticated targeting offering possible. 692These efforts will, of course, be balanced by the industry’s 598important and ongoing efforts to provide sound self-regulationaround data management and privacy. 2007 2008 2009 2010Our investment in ad exchanges grew by 66 percent in 2010and is projected to grow again by more than 60 percentin 2011. Even with that growth, there is still plenty of upsidein this category since it represents less than 10 percent of our However, we have continued to increase our concentrationtotal ad spend. on fewer and more strategic partners. This focus on more complex, strategic partnerships has resulted in strong benefitsTotal spend in ad exchanges for our clients in terms of scale, price, innovation and access. The breakout of our spend shows that 55 percent of our 300 aggregated budget goes to our top five strategic partners, 25 percent to the next 32 largest partners and the remaining 250 2011 20 percent in our long tail of 584 publisher partners. 200INDEX 150 2010 Spend breakout 100 2009 100% 50 90% 80% 0 70% = TOTAL SPEND 60% 50% 40%2. CONSOLIDATION OF PUBLISHER PARTNERS 30% TAIL 20% BODYThe emergence of new technologies and consumer channels 10% 0% STRATEGICcontinues to provide opportunities for the emergence of new TOTAL NUMBER OFpublisher partners. In 2010, we purchased media across 598 SPEND PUBLISHERSsites, down from a high of 1,832 in 2007. While we expectmany of those buys to be consolidated through the growthof audience buying across ad exchanges, we still see theneed to test new platforms and technologies. OUTLOOK REPORT | VOL 10 9
  8. 8. 3. INCREASED INVESTMENT IN PAID SOCIAL MEDIA 4. SHIFT FROM PAID TO EARNED AND OWNED The rapid rise of social media has impacted digital and our The scale of leading social media platforms such as Facebook, clients’ business in many ways. As social media platforms Twitter and YouTube had a strong influence on the overall continued their explosive growth in the last year to reach marketing mix for our clients. However, the overall amount massive scale, leading marketers adjusted their plans of dollars invested against social media still pales in comparison accordingly to begin a two-way dialogue with current and to search and display. The advertising models of these emerging potential customers. media titans are still evolving, but they will undoubtedly garner a growing share of marketing dollars. This has led to the emergence of Facebook as a leading partner in paid media for Razorfish in the last year. Since our In addition, the investment in social media management on early tests and inclusion in Facebook media programs in 2008, third-party and owned platforms is not to be overlooked. The the social network has gone from being in the lower tier of our vast majority of our clients now have earned and owned media top 200 publisher partners to catapulting to one of our top five strategies to complement their paid media strategies. Over the media partners (as measured by total spend). The growth can last year we’ve seen tighter coordination between the paid, mostly be attributed to the fact that Facebook has innovated earned and owned channels. We now manage relationships with in terms of media offerings and that these new opportunities close to 10 million fans and followers on behalf of our clients, not are helping our clients meet their marketing goals. Facebook’s including audiences on Web sites and microsites that we manage. growing audience makes it a platform that our clients need That’s roughly nine times what we managed just a year ago. to include in the development of their marketing plans. Our projections for 2011 point to continued growth and show no Our research into social media analytics has given us great evidence that the rise of paid media on Facebook will slow down. 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.10 THE YEAR IN MEDIA
  9. 9. “Best of the Web”MOST INNOVATION IN MEDIA OPPORTUNITIES BEST COLLABORATION PARTNER WHERE WE MOST WANT TO SPEND MONEY, BUT CAN’T FIGURE OUT HOW PREFERRED MOBILE PARTNER PREFERRED VIDEO PARTNER MOST CONSISTENT PERFORMANCE (ADVERTISING.COM)5. ACCELERATING GROWTH IN MOBILE touch interactivity together with sound, sight and motion will enable marketers to provide new, rich experiences to their customers.Our mobile media and search business nearly doubled last yearand represented close to 10 percent of our total paid media ALWAYS-ON PHONES. Multitasking with mobile while watchingbusiness. The major factors that affected this accelerating TV is driving higher consumption of mobile media and providinginvestment represent trends that will continue to make mobile new opportunities for marketers to engage with their audience.one of the fastest growing categories: Razorfish conducted a study in collaboration with Yahoo! to understand consumer behaviors and marketing opportunitiesINCREASE IN MOBILE TRANSACTIONS. Our clients are investing across multiple screens. One of the conclusions from our researchin fully functional mobile experiences where consumers can start is that mobile is emerging as an indispensable activation vehicleto transact and purchase in the mobile channel. While mobile for the massive investments in TV advertising. The completecommerce is still small and nascent, mobile is becoming an details of the study are covered later in the Outlook Report.important touch point in the consumer experience. As marketersincrease the quality and quantity of mobile experiences, themobile media and search spends will follow. For example, one “Best of the Web” — A planner’s perspectiveof our clients is seeing pay-per-call increasingly drive significant As we’ve done in the past, we polled the Razorfish mediascale and ROI. team to discover the “Best of the Web.” We asked a variety of different questions to get a directional perspective of upcomingGROWTH OF TABLETS. The proliferation of tablets in the marketplace trends. The questions revolved around creativity, performance,is creating an entirely new channel. As consumers increase their quality and overall general satisfaction.consumption of media on tablet devices, it will provide a scaledmedium for advertisers to reach their audience. Innovations in Some of the “Best of the Web” results are listed in thetablet computing will lead to advertising opportunities that differ graphic above.significantly from those on PCs or phones. The ability to bring OUTLOOK REPORT | VOL 10 11
  10. 10. 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 is very useful in helping marketers broaden thinking around marketing strategies. But perhaps the real value is in helping There is no doubt that digital media continues to be the most reinforce the notion that content is media. And content can exist dynamic and innovative sector in marketing. One of the byproducts in many forms. The notion that agency planners are responsible of the rapid pace of change in digital media consumption is the for content leads to strategies and plans that can have a much constant struggle for the industry to evolve traditional delivery greater impact. In the next year, progressive marketers will models. Over the next 12 months, agencies must focus on be the ones that begin to integrate all their brand assets into adapting to the proliferation of new consumer behaviors and a single communication platform, creating a unified brand new marketing tactics. In particular, next year will be dominated experience that puts the needs of the consumer at the center. by challenges such as how to manage video across multiple screens, how to rapidly incorporate changes in social media, 2. DATA MANAGEMENT how to plan in a cross-platform landscape and how to scale In the last five years, we’ve increased the amount of data that mobile advertising. we manage in our own servers from 3 terabytes to 90 terabytes. While those trends will certainly dominate the conversation The ability to manage large and complex data sets has shifted around media and marketing, it’s our perspective that there from being a core differentiator to an absolute requirement. are also four major themes that will work to reshape digital Data sources are more vast and complicated than ever. media in the next year. Building a single view of the consumer across all channels is the only way that marketers can truly build effective marketing 1. CONTENT AS MEDIA programs. More than 80 percent of our media clients rely on a data management platform that we have custom built to make Most marketing professionals admit to having been in a vigorous their digital marketing more targeted and more effective. Over debate sometime in the last year about the classification of a the next year, these platforms will continue to become more particular tactic as paid, earned or owned media. The construct12 THE YEAR IN MEDIA
  11. 11. sophisticated, taking into account an increasing number of data in real time. Agencies that are well-versed in bid-managementsources. Data management pays off for marketers — we’ve systems, and that invest in the tools and processes to managebeen able to improve return on ad spend more than five times those systems, will become industry leaders. The real-timeby serving personalized ads to dynamic segments enabled and highly complex nature of digitized media allows marketersby a unified marketing database. to develop a sustainable competitive advantage.3. REAL-TIME BUYING 4. ATTRIBUTIONIn the last year, we have more than tripled the number of real- For the last decade, we’ve been building attribution modelstime impressions we’ve purchased. On average, we’ve seen for our clients to help them invest their marketing spendperformance improvements of more than 40 percent for our more effectively. In the pioneering days, this type of analysisclients. The real-time nature of digital data has simply changed was done infrequently and was limited in breadth and scope.the way we buy media. Those who are able to understand data Today, with the data and processing infrastructure we haveand act upon it immediately — in real time — have a strategic invested in over the last 10 years, and the growth of theadvantage over their competitors. Long gone are the days marketing analytics group to more than 100 professionals,when companies and their agencies could buy media months we are actively building these kinds of models for our clientsin advance, then wait several more months to understand on a regular basis. In fact, we’ve seen return on ad spendinghow those media investments performed. Today, agencies improve by as much as 3.5 times through smarter allocationand brands have seconds in which they must respond, or of media investments. While it’s a discipline that demandspotentially leave millions on the table in lost value. Brands need constant iteration and analysis, that type of improvementpartners who can collect, translate and take action on that data makes attribution modeling a crucial strategy for marketers. OUTLOOK REPORT | VOL 10 13
  12. 12. Forget Mobile — Think Multiscreen As is the case with many new technologies, consumers are movingWRITTEN BY faster than brands. They’re already using smartphones and tablet devices in front of the TV to communicate with friends and family, Jeremy Lockhorn look up information related to the show they are watching, or else VP, Emerging Media surf content that is completely unrelated to what’s on the big @NEWMEDIAGEEK screen. Razorfish partnered with Yahoo! to conduct a study to better understand this rapidly evolving consumer behaviorWITH CONTRIBUTOR 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 onREAD MORE 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 Scan the QR code with a Web-enabled device on their lap or in their pocket. to explore additional content associated At a minimum, multitasking adds another layer of complexity to the evolution of with this article. 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 OUTLOOK REPORT | VOL 10 15
  13. 13. of respondents are mobile multitasking while watching TV. C3 ratings were born to begin to address a world where the partnered with Yahoo! to conduct a survey among Web-enabled consumer is increasingly in control.1 Now, add mobile and tablet phone owners with the goal of better understanding this rapidly multitasking to the mix and marketers everywhere wrestle with evolving consumer behavior and providing some guidance measuring the latest evolution in consumer TV viewing behavior. for how marketers should approach them. On one hand, there is a potential distraction factor with We found that a stunning 80 percent of respondents are mobile connected devices, and on the other, there is a much more multitasking while watching TV. Below are some highlights and engaged viewer who is passionately chasing down more content key implications for marketers. on devices beyond the TV. How do marketers account for that with Gross Rating Points (GRPs) and Target Rating Points (TRPs)? MOBILE MULTITASKING IS ADDICTIVE. 70 percent of respondents We don’t yet have a clear answer — give us six months — who multitask do so at least once a week, with nearly half (49 but most marketers seem to be ignoring the question and percent) reporting everyday multitasking. Furthermore, during failing to capitalize on the corresponding opportunity created the course of a TV program, more than 60 percent check their by mobile multitasking. phones at least “once or twice,” and 15 percent stay on the Which leads us to this: Lots of data has been published about mobile Web for the full duration of the show. the fact that consumers are using mobile and tablet devices MULTITASKING IS BOTH AN ENHANCEMENT AND A DISTRACTION. while watching TV, but little of it has gone deep enough to be An equal percentage of multitasking respondents (38 percent) really useful in planning a multi-screen strategy. So Razorfish agreed or strongly agreed with these statements: 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/.16 FORGET MOBILE — THINK MULTISCREEN
  14. 14. Using the Internet on my mobile or tablet device while so high and social networking so low; we expected the reverse. watching TV enhances my viewing experience. On the content side of things, 60 percent of multitaskers are accessing additional content of some type. 44 percent I find using mobile devices while watching TV is unrelated to what’s on TV versus only 38 percent related to TV. to be distracting. Clearly there can be a distraction factor here when it comes toThis seems to be an opportunity for content producers and TV commercial time, but the good news for marketers is that 36advertisers alike. Some people find multitasking to be a boon, percent of multitaskers use their connected devices for lookingand we have only begun to scratch the surface in terms up information on a commercial they just saw.of providing an engaging dual-screen experience. It’s like theearly days of smartphones where it was remarkable that people TV AD TIME = MOBILE PRIME TIME. TV ad breaks are triggers forwere making purchases from sites that were not mobile-optimized. multitasking because phones and tablets are, not surprisingly,If folks were willing to go through that much effort, it stands to more likely to get fired up and accessed during regularreason that making the experience easier and more streamlined commercial pods. And, our survey respondents were more likelywill lead to even more passionate participants. to state that they frequently engaged in multitasking during ad breaks. What people do during this time doesn’t change allCERTAIN PROGRAMMING GENRES LEND THEMSELVES TO that much. It’s still communication first and content second.MULTITASKING. The top five categories that attract An analysis of mobile Web traffic to the Yahoo! homepagemultitaskers are: 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. 1. Reality 2. News 3. Comedy 4. Sports 5. Food 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 communicationWhile the top results may not seem surprising, what struck us (recall it was the other way around overall). Texting still rules, butabout the results further down the list were that drama edged after that, other communication styles drop off — and variousout genres like talk shows, music videos, how-to and others. content rises to the top. Leading behaviors include checkingWe thought drama and action/adventure shows would be less scores and schedules of other games, and looking up teamlikely to see multitasking behavior. Perhaps these intense and player information or statistics. Smack talking showed upprograms stoke multitasking as viewers get hooked and seek surprisingly low (20 percent) — maybe that’s because it’s notways to further immerse themselves in the show’s world. Think as rewarding when you can’t see the look on the other guy’sabout Breaking Bad, CSI, Dexter or True Blood — those shows face — this feels like an opportunity for an inventive developerare intense but they also beg viewers to dig a few levels deeper (or enterprising marketer).than what happens during those weekly 40-plus minutes. Again, an analysis of Yahoo! mobile traffic confirmed that withCOMMUNICATION AND CONTENT ARE THE MAIN DRIVERS FOR sports content (in this case, World Cup 2010 and Super BowlMULTITASKING. 94 percent of multitaskers engage in some kind 2011), commercial breaks spark mobile usage. Even biggerof mobile communication. In order — text, talking, email, social spikes are seen at halftime and after the games. For example,networking and IM. It’s somewhat surprising to see talking during the Super Bowl halftime show, Yahoo! Sports saw a 305 OUTLOOK REPORT | VOL 10 17
  15. 15. Content and experiences that move seamlessly from one screen to another are an absolute must. percent increase in mobile traffic. After the game, even more happening in the TV spots, and perhaps even what’s happening users flooded the sports section, pushing overall increase up in the current program — especially if it’s live. At a bare minimum, 387 percent. And, not surprisingly, Yahoo! saw massive spikes it’s time to consider what kind of mobile call to action may be in mobile search traffic related to TV spots, including several appropriate in the brand’s TV spot. movies and automobile manufacturers. Pepsi, Old Navy and Heineken have begun experimenting here. Pepsi gave away a free bottle of Pepsi Max to users who tagged Implications for marketers the commercial using IntoNow, a Yahoo! social tool that allows YOUR TV CONTENT STRATEGY MUST EVOLVE (AGAIN). It used to you to share what you’re watching with your friends. Old Navy’s be relatively easy. Crank out a few 30-second spots and call “Old Navy Records” campaign encourages users to tag spots it a day. But then came the Web, video on demand, basic with Shazam to unlock related content like the featured looks, interactive TV capabilities and so forth. Most marketers are and even download the music tracks for free. Heineken’s Star still struggling to figure out how to truly capitalize on the Player app gives users the chance to play along with soccer opportunities represented by long-form video and — more matches by attempting to predict which team will score within recently — social content. Now, a new imperative is clear, the next 30 seconds. These efforts begin to show the possibilities, especially for those spending heavily on TV. Content and but are only scratching the surface. experiences that move seamlessly from one screen to another MOBILE SEARCH IS ABOUT MORE THAN LOCAL. There’s no doubt that are an absolute must. This is bigger than simply having local search is very important. After all, mobile users are accessing a mobile- or tablet-optimized Web site. It means a cohesive local search 34 percent more than they were a year ago, according communications strategy where the spots and the experience to research from comScore and the Local Search Association. on mobile devices work together and build toward a greater But, with the massive amount of multitasking behavior highlighted whole. It means a mobile-optimized site that knows what’s here combined with the various studies suggesting that anywhere from 30-40 percent of mobile data usage happens at home, mobile18 FORGET MOBILE — THINK MULTISCREEN
  16. 16. search isn’t exclusively about finding the closest taco joint. to action could be something along the lines of “See your favoriteMarketers must reconsider their search strategies. At a minimum, celebs arriving in the new XYZ car,” linking through to a seriesthey need to ensure that their mobile properties are properly of videos and also featuring the red carpet reporter’s overview.positioned in organic results. It may also be worth re-evaluating CONNECTED DEVICES ARE THE NEW WATER COOLER. People aren’tthe keywords they’re bidding on, perhaps to include terms thatlink the brand to shows and events they’re sponsoring. waiting until the next day to discuss what happened on their favorite program anymore — it’s happening in real time now,Let’s take an automotive company launching a new luxury sports via text, email and social networking sites/services. Brands cansedan, for example. Part of the launch is sponsorship of a live ride along here as well, but it requires a smart social strategyawards show — several spots appear throughout the show and that syncs the brand with the programs they’re sponsoring.the celebs hitting the red carpet arrive in the new vehicle. It’s not easy, but with more than half of multitaskers gettingBumpers include “sponsored by” mentions and on-screen active on social networks during TV viewing, there is a massivelogos. The spot closes with a URL. Some viewers might jump opportunity to engage the audience on a new platform.to their phones, fire up the browser and enter the URL.But a good portion of them will also take what they perceive In the automotive example above, there are several waysto be a shortcut: typing the brand’s name into a search box. the brand might get involved in the real-time discussion.Organic and paid results should appear and direct a relevant Aggregating Twitter feeds on their homepage, for example, allowsexperience — perhaps the site’s homepage temporarily features users to explore the new sedan while staying connected. Perhapsthe new model as well as content related to the awards sponsored tweets could go out from a few celebs talking aboutprogram. Perhaps the red carpet reporter films a walk-through how much they liked the ride in the car. The brand’s social networkof the vehicle, and that video is made available. To drive even presences could all be talking about the show, perhaps launchingmore traffic and engagement, the brand could bid on search terms real-time polls asking users to predict who will win the nextrelevant to the awards show (and popular gossip sites). The call category. And so on. OUTLOOK REPORT | VOL 10 19
  17. 17. Connected devices are the new water cooler. MULTITASKING MIGHT FINALLY KILL (OR AT LEAST REINVENT) large groups of people are tuning into. And, with so much THE GRP. The GRP debate rages on. The metric that has been brand engagement happening on these connected devices, the currency of the offline world for decades has tried time effectiveness of spots may also be more accurately measured. and time again to enter the digital world, only to be beaten back Lastly — and this is the silver bullet — with massive growth by legitimate arguments that it doesn’t accurately account for expected in mobile payments and mobile wallets, the same different levels of engagement, among other weaknesses. device that knows what people are watching and what people But here’s the remarkable thing about multitasking — are surfing will soon know what they’re buying, creating increasingly, the devices are going to know what people are the ideal closed loop for ROI-driven marketers. And who watching, providing a potentially more accurate view into what isn’t ROI-driven these days?20 FORGET MOBILE — THINK MULTISCREEN
  18. 18. By Frederic Bonn Do you rely on more than one agency Do you know how most to handle your communications and agencies operate? marketing? Do you want your agencies to successfully collaborate? Is that single agency capable of mastering Do you have one lead agency creating Heres a little more about how integrated communications from social ideas while the others simply follow? agencies think. media to mobile, event planning to media buying, TV to digital? They all love what they do, but their love is blind. Do you want a consistent Agency A thinks that Agency B is communication clueless about digital, even though platform that Agency B said they had videos on And you have operational works across all flexibility and scale? channels and is YouTube — “That’s digital, right?” relevant to the consumer Your lead agency is probably the “traditional” B dismisses A’s ideas because A behavior in agency, right? Great, you now have a 30 doesn’t know anything about the each? second spot (or 60) and some print ads. brand, but come on, A had a video on YouTube, too! — “That’s brand And you re building, right?!”satisfied Did you develop an integrated brief thatwith that? And they provide A and B think C should just follow incorporates all agencies, teams and ground-breaking what they say — “Wait, you didn’t disciplines involved in your business? creative ideas get our memo?” that deliver great And D should just buy what they results? Do you believe consumers only all need — “Because we’ve experience your already figured it out.” brand via one media channel? Are Do your teams meet regularly you in to develop an integrated brand denial ? strategy and campaigns? So you’d actuallyrather workwith multiple agencies? Have you defined your individual agencies’ roles and responsibilities? And they never try to compete anyway? OUTLOOK REPORT | VOL 10 21
  19. 19. A Wake-­Up Call for Collaboration The ability to integrate creative, media and technology to meetWRITTEN BY the demands of your always-­on consumer is ideal. However, most traditional lead agencies don’t have those capabilities just yet, nor Pete Stein are most digital agencies prepared to handle lead agency duties. President, East Coordination of your agencies is not enough — you need to move @PSTEIN211 more aggressively toward true collaboration. We’ve identified five big barriers to essential agency collaboration.WITH CONTRIBUTOR People now consume 12 hours of media in just 9 hours of elapsed time, according Frederic Bonn to a recent Harvard Business Review study.1 Consumers use a lot of media types Executive Creative Director all at once and now brands need to catch up. To do so, marketers must change @FREDERICBONN 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 integrateREAD MORE 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 Scan the QR code traditional agencies were equipped to handle interactive marketing work.2 Fast to explore additional content associated forward two years and Forrester still reports that only 30 percent of those surveyed with this article. 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 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. OUTLOOK REPORT | VOL 10 23
  20. 20. Coordination of agencies is not enough — you need to move more aggressively toward collaboration. agencies on their interactive rosters.3 By the same token, most We have seen five big barriers to collaboration: digital agencies aren’t yet ready to handle lead agency duties. In 1. CLIENT EXPERIENCE/CONFIDENCE three to five years, the landscape will look different, but for now marketers have to deal with a patchwork of agencies that are As a brand marketer, you probably have more confidence channel specialists and all the complexity that comes from that. in one area of the marketing mix or the other. Perhaps you are What can you do now to drive the integration of creativity, a digital native who lives and breathes ones and zeroes, and now media and technology that you need to truly engage consumers? you’ve been promoted to look after the whole mix. Or maybe Coordination of agencies is not enough — you need to move you’re a “traditional” marketer with a strong legacy of brand more aggressively toward collaboration. And guess what? building, but you’ve had your run with TV commercials. Agency folk want more collaboration — or at least they claim You find digital exciting, but daunting and maybe even a bit they do. over-hyped. Wouldn’t life be better if your agencies were bringing truly integrated ideas to you? So, what are you waiting for? If you are a CMO or brand leader 2. CULTURAL INERTIA and you’re not pushing your agencies for deep collaboration, you’re missing out on a big opportunity. 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 3 Sean Corocan, “How to Optimize your Interactive Agency Roster,” Forrester, May 27, 2011.24 A WAKE-UP CALL FOR COLLABORATION
  21. 21. in a position for future failure. Similarly, agencies, particularly you’re at it, examine your own organization. Agencies tendaccount people, are protective of their turf. Unless they feel to organize around their clients, so if your organization is siloed,their piece of the pie is protected, change will be difficult. it’s likely that your agencies will be, too. Even if you don’t change your structure, make sure your organization is aligned3. ABOVE-THE-LINE AGENCY SNOBBERY and not operating in silos defined by channel.Some above-the-line agency teams believe that: 1) digital agencies DEMAND CREATIVE AND MEDIA COLLABORATION. Creativedon’t have anything of value to contribute to the conversation, collaboration starts with a solid brief delivered to all agenciesor that 2) their team is already leading the way in digital. simultaneously. Unearthing an insight that reflects true audience behaviors is critical to crafting a relevant message, no matter4. DIGITAL AGENCY LIVES IN A DIGITAL BUBBLE who makes it or when it’s launched. The brief needs to nail theDigital agency teams tend to fall down in two places: 1) they business objectives, brand DNA and the digital behaviors —don’t fully respect the power of offline communications, or with the goal of tapping into the rituals that are ripe territory for2) they aren’t able to lift out of the tactical and into the strategic, the brand. We recently found that if we allow the above-the-lineand they fail to put their work in this broader strategic context. agency to own the brand DNA, we can own the digital behaviors,This leads clients and above-the-line agencies to keep them thereby making sure they are embedded into the ideas. This willin their digital silo. enable your creative teams to come back with a true creative platform — not just a single execution that’s stretched across5. CLIENT SILOS channels. One-hit television campaigns or social campaigns do not a platform make. Don’t settle for anything less than a robustClients are often organized into silos that make it very difficult creative platform. Huge bonus points if your media agency isto plan with a focus on how the consumer and the brand should part of the team. A successful channel plan is one that considersengage. There are different client owners for traditional creative, how to leverage each channel in a way that makes the wholedigital creative, media, PR and other elements of the mix, too. greater than the parts. You’ll find that when media and creativeWhen agencies report into different silos, true collaboration will teams work together, you’ll get deeper consumer engagement.not occur. And just to be certain that the ideas are inherently social andDespite these barriers, we have had success with our clients engaging, we have found it beneficial to include explanationsand our agency partners. We recently formalized our partnership in the brief. Use the brief to articulate why the insights pointwith BBH at Unilever, a client with whom we’ve had a lot toward engagement.of success rethinking the model. Here are some lessons we’ve PROTECT COMPENSATION AND PROVIDE INCENTIVES THAT DRIVElearned on getting the best work out of the right people: ALIGNMENT. Incentives are a powerful lever that should be pushedESTABLISH THE PROCESS. In order to get the most out of each to drive behavior. Agencies should be rewarded for collaboration.agency, make sure you define a clear process for them to work Ultimately they need to be rewarded for great work and businesstogether. You need to clarify the boundaries of their engagement, impact, but consider this to be part of a journey. They need to knowexpectations and ownership. One exercise we went through that their piece of the business is protected. While strategywith a partner agency was to play the “what if” game. We talked is shared, execution should be handled by channel experts sothrough all of the worst-case scenarios we could imagine that change is managed gradually. In addition to giving agenciesand how we would handle them when things went wrong. a safety net, give them a reason to jump higher. For one clientIt was a fun game and a great way to talk through problems we (us and the ATL agency both) receive a bonus if we helpin an environment where emotions weren’t running high. While the client exceed key business targets. OUTLOOK REPORT | VOL 10 25
  22. 22. To get the most out of each agency, make sure you define a clear process for them to work together. KEEP A SLUSH FUND. A key to successful marketing is figuring ability to create urgency. You need to set a high bar. For instance, out how to integrate always-on and episodic (campaign-based) point to competitors or other brands that are doing it well. communications. Great creative platforms should have plenty And you need to shift the risk. Tell your agencies that if they fail of legs and should be responsive to consumer engagement. by trying something new and different, you will embrace it, but This creates a great opportunity for agency collaboration, if they fail by not collaborating, it will be a strike against them. 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 In the end, agency collaboration is rooted in something very you may have created. When we created the Mercedes-Benz fundamental — trust. Your agencies need to trust each other Tweet Race last year, we saw that there was a lot of curiosity to produce great work. By setting up a clear process, demanding about the tweet-powered vehicles. We jumped on the buzz creative collaboration, and planning for the unplanned, you can and created a spoof video of German engineers driving cars go a long way toward setting up the structure and incentives with their mobile devices. It helped ignite a lot of interest. that your agencies need to build trust amongst each other. You need to start planning for what you can’t plan. With a solid foundation in place you can count on your agencies to do their job exceptionally well. CREATE URGENCY. Without a substantial reason to change behavior, it will not change. You, the client, have the greatest26 A WAKE-UP CALL FOR COLLABORATION
  23. 23. It’s Time for Big Data to Improve Customer Experience Channel-­based marketing is dead. The increased amount of dataWRITTEN BY available at the individual consumer level, combined with the proliferation of cloud computing, have allowed savvy analysts Mark Taylor and marketers to create a truly singular view of the consumer, VP, Customer Insight Group regardless of touch point. This single view enables a truly LINKEDIN.COM/IN/MARKCHRISTOPHERTAYLOR enhanced consumer experience and more efficient use of client and agency resources for decision making. All the customerWITH CONTRIBUTORS data out there is worthless if you can’t process it and turn it into Marc Sanford, PhD actionable intelligence. Director, Customer Insight Group Unfortunately, older data processing technologies (such as Relational Database @MMSANFORD Management Systems, or RDBMS) are simply not capable of processing data in volumes that the industry has collectively coined “Big Data” — volumes that Pradeep are in terabytes/petabytes. As such, we position the consumer as the only real Ananthapadmanabhan appreciating asset and we tie everything together through the use of Big Data. Chief Technology Officer, VivaKi LINKEDIN.COM/IN/PRADEEPANANTH 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, weREAD MORE create a 360-degree view of each individual in the database. Using integrated Big Data approaches, we are now informing the holistic data Scan the QR code view to gain the fullest understanding of consumer interactions, intent and value to explore additional content associated possible. This current shift centers on how customer intelligence across channels with this article. is not just used for insights, but actioned at great velocity to power multi-channel targeting and personalization, made real through dynamic digital messaging. OUTLOOK REPORT | VOL 10 29
  24. 24. Paid Email Search Mobile .com 3rd Party Data Web Analytics razorfish-­ Analytics OPEN TM Platform Display Reporting Earned Owned Social AOD Media Targeting OWNED Each touch point is an identifiable interaction PAID and an opportunity to build value. EARNED razorfishOPENTM 3RD PARTY (AOR/Client/3rd Party) From insight to action, we’re now finally implementing consistent and relevant messaging approaches that provide cohesive consumer experiences. Modular approach to platform and services, by fully integrating an organization’s owned, paid and earned In our experience, each client using Razorfish’s Big Data-led channels for insights and targeting. 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. Better use of the team’s time to focus on what matters Working with different clients has enabled us to determine most to their business. realistic roadmaps. Data enables us to understand customers and to manage Holistic integration benefits: contact and content strategy. Data is a core component of integrated marketing and, via an integrated approach, we can Common Data Marketing Platform (DMP) for reporting, speak with a single voice across channels and lines of business. analytics, targeting and media integration. However, to succeed in a meaningful way at that level of A channel and customer view of success. customer centricity, we have to manage all that data in a way that holistically fuels customer engagement and experiences. Metrics that measure end to end, not just in parts. That effort requires a whole ecosystem of people, processes Decision-making through actionable insights. and technology. A common language for performance across different Even the most sophisticated and modern businesses today are teams, brands and markets. surprisingly ill equipped to manage even the most basic digital30 IT’S TIME FOR BIG DATA TO IMPROVE CUSTOMER EXPERIENCE
  25. 25. There’s a new game in town — it’s cross-­channel data management and marketing.marketing standards and activities, let alone jettison forward you might think. Much of the technical and analytical challengesinto the new world of Big Data techniques. for tapping Big Data have been solved — but failures today often stem from attempting to use legacy small data solutions,Through a series of in-depth interviews and client experiences, internal politics, effort fragmentation and failure to manage theRazorfish found a common set of fundamental challenges true value of Big Data-based solutions. While a lot of nicheholding back meaningful data integration: players using Big Data approaches have stepped up to solve parts of this challenge, building incremental capabilities in a silo Fragmentation of efforts between different teams, tools and can by default push you further into a silo-based culture and data sources across multiple channels, brands and regions. limit your understanding of the customer. Political and fiscal turf protection. Any holistic Big Data solution requires a scalable measurement Multiple sales funnel constructs. plan and tagging strategy at its foundation so you can take into Inability to identify the customer. account performance marketing efforts across channels, tactics and disciplines, with a shared strategy of measurement and Inability to quantify the value of customer experiences. tracking that is scalable across international regions and markets.Let’s take a closer look at how our approach to Big Data, usingthe razorfishOPENTM framework, can remedy these issues. The end solution provides a subtle and intelligent approach that can evolve by integrating and building upon other assets,Fragmentation data sources and capabilities already in place. This approach enables a modular and organic ability to evolve and grow, butWe’re in an era where intelligent use of Big Data pays huge with a standardized core. These qualities are not always thedividends. Implementing solutions that improve integration of prerequisite in Big Data techniques, but without this there isdata is very challenging and complex but not for the reasons no foundation for growth. OUTLOOK REPORT | VOL 10 31
  26. 26. Online Transaction Profiles & Display Social Search .com Mobile Email Retail/ Data Segments Store MEDIA SOCIAL MEDIA SITE MOBILE EMAIL MERCHANDISING TENURE AND ATTITUDINAL METRICS METRICS METRICS METRICS METRICS METRICS METRICS PRODUCT VALUE Report Report Report Report Report Report Report Report Report MEDIA AGENCY MULTIPLE IN-HOUSE IN-HOUSE RESEARCH SEARCH AOR DIGITAL AOR DIGITAL AOR IN-HOUSE OF RECORD (AOR) AGENCIES TEAM 1 TEAM 2 AGENCY DFA Buddy Media Marin Omniture Flurry ExactTarget ATG Custom Custom OWNED Example of a siloed view of data management and reporting. PAID EARNED 3RD PARTY (Client and 3rd Party Data) Turf wars and deep analytics. This was the foundation starting point for their organization and it ensured they gained political capital across Crossing organizational units can be tricky. Often clients are their business model through an evidence-driven, customer- not set up internally for a path to success based on complete centric approach that enabled financial modeling of return on integration and use of available data. Organizations are formed investment. Their next phase focus is on actioning that data for around channels — one unit owns the Web site and its data, targeting across display advertising and the Web site. another owns CRM and email, another may own Web media and yet another may be in charge of social media. Worse yet, Another Razorfish client, a major global retailer, recognized each silo may have its own analytics arm. The only way to be that they had a wealth of underutilized offline and digital data. part of this organizational conversation is to think big. We have They decided to leverage Big Data approaches to integrate gained phenomenal success by leveraging Big Data-based multiple channels and power media, dynamic re-messaging, techniques as part of a modular, digital roadmap that directs analytics and more. The ultimate purpose is to enhance the current and future business investment in the next 100 days/12 value of those relationships by aggregating information about months/3 years. Be prepared to think big even while starting the customer and communicating with them in the most relevant small, and determine your starting point and roadmap — no and engaging way. Previous iterations of this approach resulted matter how audacious your goals. in a three- to five-time increase in return on ad spend, and a significant decrease (about 65-70 percent) in cost per acquisition. A Razorfish global technology client decided their initial priority Each phase typically pays for itself in weeks, while providing the was to gain cross-channel insights before embarking on targeting funding for the next incremental phase. This becomes a sound32 IT’S TIME FOR BIG DATA TO IMPROVE CUSTOMER EXPERIENCE
  27. 27. position to be in when convincing your peers of the rationale Multiple sales funnel constructs and business case to fund such solutions. Funnel management is where people are getting clever with Big Big Data can be organized without a major disruption or re- Data, however it runs the risk of solving only one part, rather than architecture of existing structures, internal teams, vendors, the whole. We know that leveraging a single view of the consumer agencies, platforms or focus. Instead, our approach to Big Data drives value at all levels of the funnel. So why do many continue utilizes an open standard designed to exploit existing assets to approach client problems and challenges as one-offs or focus and fit the best custom solution for business environments. on just one area of the funnel? This approach has an evolving set of modular relationships managed as a single solution, resulting in a single and holistic Too many distributed engagements will lead to: view of the customer based on all available data. Our clients 1. Single point-in-time solutions that require rebuild with are using this common view to engage and encourage their every new engagement. different teams to speak in the same language. 2. An additional data silo that requires more time and effort to manage and process. Target 1.0 Target 1.1 Target 1.2 Target 1.3 Target 2.0 Heavy use of Dynamic ad, last multiple data sources Description CT with no multiple data sources action only dynamic ads delivery Delivery Display, site, email, Option/ Display or site Display Display Display mobile, call center Channel Increased relevance Higher relevance and huge long-­term Benefits Low complexity Fast to market Channel agnostic and full data access incremental data benefits Some time to set up Greater set-­up Access to data Time to market Greater cross-­channelConsiderations the offer, strategy investment to ensure is limited is longer business coordination and creative platform is in place Typical ROI 1.5 X ROAS 3.5 X ROAS 5 X ROAS ~6.5 X ROAS ~8 X ROAS razorfishOPENTM targeting roadmap. OUTLOOK REPORT | VOL 10 33
  28. 28. Funnel management is where people are getting clever with Big Data. For example, the illustration on the right shows how an effective DIGITAL OFFLINE 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 Awareness expense of the broader opportunity. Consideration The reality is that the rules and the data to enable an integrated view and management of the funnel would need to come from Retargeting 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 Conversion and remarketing is only can be joined to first-party data, not the other way around. part of the answer. 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 and relevance. This integration also enables the ability to bring Audience on Demand (AOD), to match impressions to users a wide array of data at the bottom of the funnel to the audience identified in real time. This allows you to only reach users that at the top of the funnel. have been already “qualified,” and avoid upfront agreements and negotiation by paying the market price for users meeting Inability to identify the customer criteria defined in the audience segmentation. By reaching the right audience at the right price and allowing the ability to Razorfish implements a customer-centric approach through an control bids at a cookie level provides a great deal of efficiency organized framework of measurement and tagging that tracks34 IT’S TIME FOR BIG DATA TO IMPROVE CUSTOMER EXPERIENCE
  29. 29. all digital business activity and harnesses the full stream of toward meaningful interactions at a customer level and progressdata as the core basis of the single view of the customer. From the value of their brand relationships over time.day one we leverage all existing assets, people, agencies and We have seen our clients quickly moving toward a culture thatplatforms, without a big, disruptive overhaul. Chances are these understands customer data as one of its most valued assets.existing components are there for a reason and are providingvalue, but getting that cross-functional view and line of sight is Focusing on customer value helps companies move away fromthe first objective. channel performance and toward greater customer-centricity. But to calculate customer value, companies must fully utilize theInability to quantify the value of customer experiences recency of interactions, along with the required behavior, revenue and relationship metrics. A key challenge businesses struggleOrganizations are increasingly demanding faster value return on with is finding advanced analytical skill sets and analytics-basedtheir marketing investments. Razorfish has found that businesses approaches that can leverage and interpret that data to determinenow more than ever need a true, meaningful understanding the key levers that drive value within their organization, or atof what drives customer value. Rather than using Big Data to least within a specific team’s control.improve one area of the customer experience, we need to build AUDIENCE/ PROSPECT/ CUSTOMER CUSTOMER PROSPECT/ CUSTOMER MANAGEMENT MANAGEMENT CUSTOMER Using an integrated DSP allows you to only reach customers and prospects that have been "qualified" by razorfishOPEN TM. Paid Call CenterConsistent data collection across touch DMpoints enables analytics, segmentation, .com Publisherstargeting and reporting. For example,a customer falls into segment 8, basedupon razorfishOPEN TM rules. Razorfish Owned Mobilethen targets customer experience,agnostic of channel (representedby orange dots). Email Earned Retail Open & DSP Audience Enhanced Segmentation Targeting Integration & Data Provision 3rd Party DSP and razorfishOPEN TM Client Data Providers 1st Party DMP Proprietary Data 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. OUTLOOK REPORT | VOL 10 35