The document summarizes a panel discussion on the future of direct marketing. The panel debated whether all marketing will become direct in the future. Panelists included representatives from Sony Ericsson, LBi Group, Virgin Atlantic, Comufy, BT, and Lithium. They discussed topics like using customer data and lifetime value to personalize messaging, social CRM platforms to drive engagement, and how consumer expectations are shifting to demand more relevant and personalized interactions. The chair from the DMA closed with remarks and announced upcoming DMA events on data and integrated marketing.

1. The future of direct marketing
Thursday 2 February 2012, LBi London
Gold sponsor Silver sponsor Event partner

2. Introduction from chair
Chris Combemale,
Chief Executive Director, DMA

3. Thank you
Gold sponsor
Silver sponsor
Event partner

4. Interact!
•Twitter: #dmalbi @DMA_UK
@LBiLondon
•LinkedIn & Facebook groups
•www.dma.org.uk

5. The future of direct marketing
The Importance of Lifetime Value
Chris Combemale, Executive Director, DMA

6. The value of a customer
Where do you start?

7. Not all customers are equal
Rank these profiles for Value of the
subscriber
• Entered competition to win a holiday on-line 3 years ago – not
clicked since
• One-time customer, last bought 2 years ago
• Active customer, buys every 4 months
• Active customer, buys once a year but top 10% for order value

8. Transactional Data
Frequency
Value
Recency

9. “Lifetime” alters value
• How long do customers stay active for?
• What revenue will they generate per year?
• Work this out for the whole database
• Then for customer segments
• That gives a lifetime value (LTV)
• What about different acquisition source?

10. Different Metrics, Different Conclusions
• Click-through rate
• New or repeat visitors
• Bounce Rate
• Engagement
• Micro-conversion
• Conversion to Sale

11. “All of the above is focusing on short term
success.
Even measuring “Visitor Conversion Rates” is
akin to declaring success after a one night
stand.
Visit based conversion rates promote
bad marketing behaviour.”
www.kaushik.net

12. How about adding these?
• First month sales
• 6 months sales
• 3 years sales

13. A Hypothetical Example
Best Average
Customers Customers
Purchases per year 4 2
Average Order Value £70 £50
Annual Revenue £280 £100
Gross Profit Margin 10% 10%
Gross Profit £28 £10
Acquisition Cost £8 £4
Net Profit £20 £6

14. A Hypothetical Example Part 2
Best Average
Customers Customers
Life Expectancy 3 years 2 years
Revenue Year 1 £280 £100
Revenue Year 2 £220 £60
Revenue Year 3 £180 £0
Lifetime Revenue £680 £160
Gross Profit Margin 10% 10%
Lifetime Gross Profit £68 £16
Acquisition Costs £8 £4
Lifetime Net Profit £60 £12
»

15. Top Tips
• Remember the Pareto Principle
• Acquire the right customers
• Be willing to pay for them
• Know what they look like, where they they came from, what
they want
• Know lifetime value by lead source and by segment
• Invest to keep them

16. Rethinking the traditional marketing
model: from campaigns to
conversations
James Young, Digital Marketing Manager, Global Marketing,
Sony Ericsson
Pipa Unsworth, Global head of CRM, LBi Group

17. Rethinking the
Click to edit Master
traditional marketing
text styles
model: from
campaigns to
conversations
James Young - Digital Marketing
Click to editGlobal Marketing, Sony
Manager, Master text styles
Ericsson
Pipa Unsworth - Global Head of
CRM, LBi Group

18. SONY ERICSSON BRIEF
• Video content to build brand
awareness and drive engagement
• Opting out of feature battle
• Objectives for Xperia to engage and
create lasting relationships with
influential early adopters

19. LBI'S RESPONSE: XPERIA STUDIO
• Xperia Studio was born – “Reality
Remade”
• Create content with phone at the
heart
• Wide open brief to collaborators

20. LBI’S RESPONSE
• Wide variety of content collaborators;
– Riding in the Moab with 360 cameras
– BMX tricks
– Invisible Universe application
– Hack-a-thon at an interactive art
studio located on a barge
– Surf photography
• Launched in September 2011
– XperiaStudio.com
– Xperia Studio Facebook tab
– Twitter
– YouTube
– ePR

21. TED VIDEO

22. XPERIA STUDIO RESULTS

23. DRIVING SOCIAL CURRENCY FOR XPERIA STUDIO
DEFINE OUR
STRENGTHEN GIVE ME
COLLECTIVE
MY BOND STATUS
IDENTITY

24. CREATING SOCIAL CURRENCY FOR XPERIA STUDIO CONTENT USING COMUFY
• Social CRM platform Comufy is used
to drive social currency for Xperia
Studio
• Xperia Studio Facebook users can
sign up to be first to know about new
Xperia Studio content
• Users receive personalised newsfeed
posts about new exclusive content,
which can be easily Shared,
Commented or ‘Liked’ for viral spread

25. XPERIA STUDIO CONTENT GENERATES CONVERSATION

26. XPERIA STUDIO RESULTS – COMUFY REACH
Potential reach 2.6m
Total friends of fans
Friends of fans 245k reached
friends reached through shares
Xperia Studio Fans
10K registered

27. XPERIA STUDIO RESULTS – EMAIL VS. SOCIAL DIRECT MESSAGING
Social Direct average click through: 20% Email average click through: 5.9%*
*Epsilon 2011 Email Trends and Benchmark

28. XPERIA STUDIO IN 2012
• Xperia Studio will continue to be a key
part of Sony Ericsson’s social strategy
in 2012
• New collaborator content on Xperia
Studio is coming
• Social direct messaging will continue
to be used to drive social currency
• Sign up here
http://www.facebook.com/sonyericsson

29. About LBi CRM
Click to edit Master
text styles
Click Unsworth
Pipa to edit Master text styles
Global Head of CRM
Pipa.Unsworth@LBi.com
@Peepa

30. Mobile direct marketing: the
challenge and opportunities
Ilicco Elia, Head of Mobile, LBi Group

31. Ilicco Elia
head of mobile, LBi
@ilicco

32. Technology has changed
everything

33. How technology feels

34. Early Video Calling
“ The Video camera icon is
where you would see the
person you’re speaking
to…
if they had a phone that is
compatible with your
video call.”

35. How technology
makes you feel

39. Prada NYC / Soho

40. The end-to-end journey
needs to be considered more
than ever before.

41. Martin Cooper
Martin,
a Motorola researcher
and executive, made
the first analog mobile
phone call using a
heavy prototype
model.
He called Dr.Joel S.
Engel of Bell Labs

42. There’s an app for that
Monik Markus

44. Thank you

45. Using “big data” to make the big
decisions
Allison Wightman, Head of eBusiness, Virgin Atlantic

46. The Future of Direct Marketing
Using ‘BIG’ data to drive loyalty
Allison Wightman
Head of eBusiness
Virgin Atlantic Airways

47. How Virgin Atlantic uses its wealth of demographic,
behavioural and attitudinal data to engage customers,
defend its market position and remain relevant in tough
economic times

48. Understating the obvious...
― It is not the best time to be in
the airline business
― Economic decline
― Political uncertainty
― Physical traumas
― The only constant is change
Need for innovative ideas to capture
the travellers imagination

49. Flying Club overview
― 2.7 million members
― Global programme
― US, UK, ROW
― Extensive earning opportunities
― Last year, 23 triggers
― new ‘Welcome programme’ based on
the insights from previous activity
― Email postal and SMS
― Working to totally integrate our
relationship with customers where ever
they touch us
― Online, social, retail, airport, kiosk
Whatever the technology, the same rules apply...
Right message to the right customers through the right channel at the right time

50. Driving Effectiveness through Data and
Insight

51. Business As Usual
― The trigger programme
― Automated customer
communication programme
― Enables us
― to exceed our annual revenue
targets
― improve performance year on
year
― Continues to evolve whilst
retaining relevance to customers
within their Virgin Atlantic lifetime
journey.

52. Never standing still...
― The newest trigger...
― SMS alert 2.5 hours before the
flight
― Encouraging foreign currency
exchange at the airport
― Significant conversion of 5%
― demonstrates the use of timely
communication within the
programme.
― This augments the existing Forex
email trigger campaign

53. Planning and Strategy Recency
0 - 6 Months
24 – 36 Months 6 - 24 Months
Flying Club Segmentation
/ Future
―
5+ Seasonal Flyers Flying High
― 7 groups, 29 types Ex Execs
― recency, frequency and value 3- 4
No. of Flights
Occasional Flyers Fledgling Flyers
― demographic, economic, social 1- 2 Almost Grounded
― wider travelling behaviours
Monitor the health of the 0 Currently Grounded
―
database
― Early warning of negative
behaviours
― Common currency

54. Tactical Activity
― Flight Curve analysis can optimise sale fare relevance
and effectiveness
900 Flight Curves - London Heathrow to Boston (All Cabins)
Median No. of Sector Bookings/Departures
800
Sale fare?
700
600
1 Jul 45% 8 Sep
500
9 Aug 38% 8 Nov
400
9 Oct 18%
300
200
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Sector Bookings Sector Departures
54

55. So what’s next?
― The future of Direct Marketing at Virgin is bright
― But it will look different to what it is today
― More channels
― More choice
― More integration
― More interaction
― More personal
Big Data will always support the Big decisions of this small but Big brand

56. Refreshment Break

57. Social direct messaging
Philipp Mohr, Chief Executive Officer, Comufy

58. Enterprise Social Media Management System
® Comufy is a registered trademark of Astrapia
Ltd.

59. Social Media Management System
The Comufy Social Suite
Key benefits
Data driven Full insight Proven ROI One-to-one
communicatio into users’ High click communicatio
n behaviour rate n
Some of our Enterprise clients
Some of our partners

60. Overview
• Evolution of Social Media
• Opportunities
• Build communities and be relevant
• Outlook
`
Confidential

61. Why social media?
`
• 50% logon very day
• Average 700 minutes / month
• 140 friends
Infographic via Bamboo
Confidential

62. Maturity
Young channel that is starting to mature, just like email did
`
Confidential

63. The Evolution of a Fan
Page

64. Facebook Fan Page Evolution

65. Facebook Fan Page Evolution

66. Facebook Fan Page Evolution

67. Broadcast Social Messaging

68. Current State
`
Confidential

69. Is this it?

70. Social Media Opportunities
A lot of data and a big user base
Compelling offering + Be relevant
• Clear value exchange • 1:1 communication
• Build strong • Engagement
communities • Relevancy
• Offer rewards • Personalisation
• Dynamic content
• Targeted, direct
messaging

71. Clear Value Exchange

72. Be Relevant

73. Be Relevant

74. User signup
Store data
Confidential

75. Example Results
• 35% click rates
• Very high share rates:
• Campaign to 10,000 users
• Directly shared by 3,228 users
• 945,291 total clicks through viral spread
• Key are tempting messages and good content
Confidential

76. Social Flow
`
Confidential

77. phil@comufy.com

78. Customer service is the new
marketing
Warren Buckley, Managing Director Customer Services, BT

79. The empowered consumer requires
a new means of engagement
Ed Van Siclen, SVP Business Development and Global Alliances, Lithium

80. The Age of the Empowered
Consumer
Ed Van Siclen
SVP, BD & Global Alliances
@edvansiclen

81. 8
Time Magazine’s Man of the Year

82. welcome to the
social
revolution:
around the
globe, people
are seizing
power

83. civil
disobedience:
the social web
has organized
and amplified
our global voice
confidential

84. the power of the
connected world:
collectively, we are
doing great &
inspiring things at
unprecedented
scale

85. applied game
theory:
gamers model
protein structure
which had eluded
scientists for
decades

86. the good, the
bad and the
ugly:
the dawn of the
mobile, social
and incredibly
empowered
consumer:
confidential

87. beware of the
thunder lizard!
business
models are
being radically
transformed
confidential

89. 88%
Social Media Spend
Reach $2.1Bn in US
of CEOs surveyed reported that
their top priority for the next five
years was ‘getting closer to their
customers’
Source: Forrester US Interactive Marketing Forecast ,
2011

90. Social media helps us to:
57% be more relevant
to our customers
build better
54% customer
relationships
build awareness
50% and demand for
customer focus is
our products
CMO Council, 2011
the major driver
behind social
$2.1
spentB2011
in
social media as %
of marketing budget

91. Customers want an authentic
conversation and engagement
with buyers ‘like them’
but customers
want to interact 14% of consumers trust
advertisements
with each other,
not just you
90% of consumers trust
peer recommendations

92. social brings new complexities
how do I manage and how do I measure the
who do I engage and how?
scale? impact?
superior design features
of marketers
41% surveyed had no
proven ROI of
social initiatives

93. Win the new Kindle with
built-in WiFi!!
Visit www.lithium-sce.com and complete the short
survey*
*Every participant will receive an electronic copy version of “The
Science of Social” featuring the work of Dr Michael Wu. This book
provides readers with a new perspective of understanding their
customers, their customers expectations, behavior, and potential.

94. Panel Debate: Is the future of
all marketing direct?
• James Young, Digital Marketing Manager, Global Marketing,
Sony Ericsson
• Pipa Unsworth, Global Head of CRM, LBi Group
• Ilicco Elia, Head of Mobile, LBi Group
• Allison Wightman, Head of eBusiness, Virgin Atlantic
• Philipp Mohr, Chief Executive Officer, Comufy
• Warren Buckley, Managing Director Customer Services, BT
• Ed Van Siclen, SVP Business Development and Global
Alliances, Lithium

95. Closing remarks from chair
Chris Combemale, Chief Executive Director, DMA

96. Drinks and networking

97. Upcoming DMA events
DMA data conference
Thursday 1 March 2012
Go integrated
Wednesday 28 March 2012
Please visit www.dma.org.uk/event-listing or visit the registration
desk for more information