The document discusses four key marketing priorities for the digital future: zero moment of truth (ZMOT), localization, mobile, and speed. It highlights the shift in consumer behavior towards online research before purchasing, the importance of localized targeting, and the explosive growth of mobile internet usage. The emphasis is on adapting marketing strategies to act quickly and effectively in a rapidly changing digital landscape.

1. Four Priorities
For Marketing In
The Digital Future
Scott Townsend
January 18, 2011
Google Confidential and Proprietary

2. While we all were focused on the
Recession, consumer behavior
changes have marched on.
Google Confidential and Proprietary 2

3. Digital Revolution in Context
Distribution &
Information Commerce Communication
“Read” “Buy” “Really Talk”
1994 1998 2000 2003 2006 2010
Users 77M 400M 500M 1B 1.9B
Google Confidential and Proprietary 3

4. Internet users worldwide
2010 1.9 B
Mobile subscribers
2010 5B
Digital information in the world –
videos, photos, music, texts, etc.
2010 800 exabytes
Google Confidential and Proprietary 4

5. Internet users worldwide
2010 1.9 B
2020 5B
Mobile subscribers
2010 5B
2020 10 B
Digital information in the world –
videos, photos, music, texts, etc.
2010 800 exabytes
2020 53 zettabytes
Google Confidential and Proprietary 5

6. Transformation Of Consumers Is Taking Place
ebay Farmville Amazon
Selling $6B via mobile 30M people using it every day; 180 Kindle books sold for
in 2010 an est. 800K virtual tractors every 100 hardcovers
sold daily at $3.33 each
YouTube views iPhone App store Red Cross
Lady Gaga 95M views in 5B apps downloaded 20% ($23M) of donations for
only 4 months with 10M fans Haiti in first week made via text
(MTV audience = 500k) message
Google Confidential and Proprietary 6

7. Four Priorities
1. ZMOT: The battle will shift to “Before the store”
2. Localization: Digital targeting will be more locally focused
3. Mobile: Will change the shopping experience
4. Speed: Acting fast will take on a new meaning
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8. 1. ZMOT becomes the battleground
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9. According to P&G, shoppers make up their minds about a
product in 3 to 7 seconds, just the time it takes to note a
product on a store shelf.
This time lapse is called (by P&G) “First Moment of Truth”
and it's considered the most important marketing opportunity
for a brand.
– 2005 WSJ article
Google Confidential and Proprietary 9

10. Historical Path-to-Purchase Model:
Stimulus 1st Moment of 2nd Moment of
Truth Truth:
(FMOT) (SMOT)
Google Confidential and Proprietary 10

11. NEW Path-to-Purchase Model:
Stimulus Zero Moment FMOT SMOT
of Truth:
Which Effects
ZMOT
Google Confidential and Proprietary 11

12. More Decisions Made Before Entering Store…
Where Purchase Decisions Are Made, % of Shoppers
60%
75%
83%
Source: Longitudinal Economic Study Series, IRI Attitude Link, n = 1,000+ shoppers. CPG Purchase Decisions. IRI, 2009. Google Confidential and Proprietary 12

13. The New Path To Purchase
81%
81% of shoppers conduct
research before they shop,
typically for an hour or more.
Source: GMA, Booz & Company, and SheSpeaks Shopper Marketing 3.0 Survey; n = 3,600 respondents Google Confidential and Proprietary 13

14. Online Research Forever Changed The Game
Since the recession began, 54% of consumers are spending more time
researching products online before they buy them in a store.
Google Confidential and Proprietary 14

15. New Behavior Drives A Surge In Search Volume
+188% +288%
Reviews Coupons
+209% +149%
Recipes Local Searches
Source: Google internal tools, Jan 2007-Jan 2010
Google Confidential and Proprietary 15

16. Coupon Search & Use Is Up Since Recession
Coupons
The number of digital coupon events increased by 60% Y/Y
Source: Catapult Marketing study conducted by Forrester Research as cited in PROMO, December 10, 2009 Google Confidential and Proprietary 16
Marx, a Kantar Media solution

17. Consumers Are More Discerning Than Ever
83% rely on trusted places like user ratings or product review sites
(buyers read 4 to 7 reviews before feeling comfortable with a purchase)
Source: Google Touchpoints Consumer Survey, 01/09. “Online Consumer Reviews Significantly Impact Consumer Purchasing Decisions,” Opinion Research Corporation, 06/08
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18. Google Confidential and Proprietary 18

19. Google Confidential and Proprietary 19

20. Google Confidential and Proprietary 20

21. Which Is Good News For Shopper Marketers!
+20%
Searchers Spend
Source: MarketingVox : Search Affects CPG Brand Building, Offline & Online Sales. Oct 2007. Google Confidential and Proprietary 21
http://www.marketingvox.com/study-search-vital-for-cpg-brand-building-and-both-offline-online-sales-033942

22. Search Works
Sales Lift in Brand Sales Lift in Product Sales Lift in
Only Campaign Only Campaign Coupon Campaign
Private Label
Test Brand
Source: White-labeled Search and Display Match Market Study for Ready-To-Eat Cereal Advertiser, August 2010, Sales in volume.. Google Confidential and Proprietary 22
Life versus control (dark – no search). All results significant at 90% or greater.

23. The Sheer Volume Is Staggering
Annual Query Volume
recipes 153,200,000
weight loss 54,540,000
soap 26,970,000
shampoo 15,820,000
deodorant 3,569,000
mayonnaise 1,475,500
pasta sauce 1,292,000
Source: Google Keyword Tool, US only. Google Confidential and Proprietary 23

24. Owning The Digital Shelf
Google Confidential and Proprietary 24

25. Leverage Digital End Caps
Google Confidential and Proprietary 25

26. Product Ratings Will Help Win ZMOT
Google Confidential and Proprietary 26

27. Promote Specific SKU’s Outside Of Circular
Google Confidential and Proprietary 27

28. McDonald’s Leverages ZMOT For New Smoothies
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29. 2. Localization
Google Confidential and Proprietary 29

30. Digital Enables Precision Targeting
Region City Radius Custom
*Marketer is responsible for translating ads into selected languages.
Google Confidential and Proprietary 30

31. Location Extensions Will Help Win ZMOT
272 8TH AVE, NEW YORK, NY
Address appears
as the 5th line of ad text
Google Confidential and Proprietary 31

32. Drive Traffic With Google Maps
Google Confidential and Proprietary 32

33. Geo-Target Coupon Distribution
Google Confidential and Proprietary 33

34. Think About The Local Community
Google Confidential and Proprietary 34

35. 3. Mobile
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36. The Mobile Audience Is Significant Today
314M Population of US
239M Online Population
134M Mobile Web & App Population
1) US Census 2010
2) Internet WorldStats, June ‘10
3) Includes active smartphone, mobile Internet device (iPod touches & iPads) and feature
phone devices on mobile web or apps. Source: comScore, CTIA, analyst reports Google Confidential and Proprietary 36

37. Mobile Becoming Just As Prevalent As Desktop
Global Mobile vs. Desktop Internet Population, 2007-2015
Mobile Internet Users Desktop Internet Users
2000
1600
Global
Internet 1200
Users
(MM)
800
400
0
2007 2008 2009 2010 2011 2012 2013 2014 2015
Source: Morgan Stanley Research, April 2010 Google Confidential and Proprietary 37

38. Mobile Search Is Exploding
Droid X
Sprint Evo
HTC
Incredible
Android Nexus One
Moto Droid & Eris
iPhone 3GS
Blackberry Storm
Android G1
Palm Pre
iPhone 3G
iPhone
2010
Edge 3G 4G
Source: Google Internal and Third Party Google Confidential and Proprietary 38

39. • During Holiday ’09, 10% of all shoppers
took pictures of products in-store
• In 2010 1 in 3 online shoppers used a
mobile device to browse e-commerce sites
Source: Morgan Stanley Google Confidential and Proprietary 39

40. Engage Consumers: Anywhere – Anytime
Watch Video
Searching
Home Work
Browse Internet
Use Apps
Shopping Commuting
Google Confidential and Proprietary 40

41. Consumer Mobile Intents
Where can I buy
something?
Can I buy it on my
phone?
What are others
charging for it?
Google Confidential and Proprietary 41

42. The Winning Brands & Retailers will
optimize for Mobile
Google Confidential and Proprietary 42

43. Mobile Do’s
• Look in the Mirror
• Think National with Local Intent
• Link messaging to other platforms
• Address mobile users directly with valuable
offers
Google Confidential and Proprietary 43

44. 4. Speed
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45. Leverage Insights To Move At New Speeds
Google Confidential and Proprietary 45

46. General Mills Informed Product Decisions
www.target.com/chex Try Gluten Free Chex cereal. Available at Target!
Google Confidential and Proprietary 46

47. Concept Was A Huge Success!
Google Confidential and Proprietary 47

48. Take Advantage
of the
Unexpected…
Good or Bad
Google Confidential and Proprietary 48

49. Amplify Assets Fast & Creatively
Google Confidential and Proprietary 49

50. Speed Beats Perfection!
Google Confidential and Proprietary 50

51. Be Opportunistic And Move Fast!
Miracle Whip Airs on TV Colbert Responds Kraft Immediately Joins in
on Fun via Search
Drove to Facebook and Accelerated Brand Interest And Received Positive
YouTube Homes Feedback From Consumers
Google Confidential and Proprietary 51

52. Thank You!
Scott Townsend
January 18, 2011
Google Confidential and Proprietary