driving customer engagement through multichannel marketing
TRANSCRIPT
Driving Customer Engagement through Multichannel MarketingFeb 2010
2
Agenda• Today’s consumer & marketing environment• Implications & issues• 4 strategic opportunities• Payoff & roadmap
3
The consumer is boss• Unparalleled choice & information• Multichannel, with or without you• New attitudes: frugality, sustainability, activism
7% savings rate reduces US consumer spending by $1 trillion
182,000 new consumer products /yr
170 million shop online in US
$622 billion global ecommerce
1.7 billion Internet users worldwide
4 billion handsets worldwide (1B browsing)
130 TV channels in avg US household
OOH innovation (car, plane, gas station)
4
Marketing undergoing enormous change• Drive for accountability in a budget constrained world• Technology is a game changer
– Innovation in targeting, versioning & analysis– Media unlocked & abundant– CRM becomes CMR (ex: Pepsi)
• Direct share growing. Boundaries blurring. (ex: P&G)
48%
58%
59%
2003
2009
2010
Digital/Direct Share of US advertising
5
But, substantial barriers gate progress…• Spend mismatched to consumption driven by legacy media planning practices
• Spend mismatched to customer value driven by outdated success metrics
• Complexity in execution, compliance & attribution
• Who owns the customer?
6
…yielding suboptimal results• Traditional advertising is less effective• Legacy media suffers• Marketing platforms being overrun
$112 billion wasted advertising in the US every year
85% of brands stagnant or declining
-21% NPS
Advertising = FALSE
-18% decline in US above the line advertising in 2009
7
Change May Be Necessary
8
4 strategic opportunities
• Remix media to consumer consumption
• Invest to enable recurring revenue and customer engagement
• Discipline in improving media effectiveness
• Recognize customer information as a key asset (really)
9
Mobile42% look up product information in the store. 28% purchase online if not available in the store. 4.5B text/day/US. 2.3B app downloads/yr
Geo-marketing. Location finder. Coupons. Alerts.
Integrate email/display
Metrics High Payback Applications
Display2X purchase lift v. search. Equal to TV purchase lift
Just 5% brand advertising is online
Audience-based targeting & versioning
Intent-based (re)targeting.
Social 2-4x link performance v all othersCultivate social influencers in new product launch
Cross-sell by friends products owned
Email$44 revenue per $1 invested. 16X profits, targeted v blast
42% buy offline in response to email (11% buy 4+)
247B emails/day worldwide
Cultivate customer interactions. Newsletters/alerts
Integrate mobile, social, e-commerce
Target by clicks, purchases, profits, social influence.
InteractiveTV
15MM households with iTV – 25MM by end 2010
7% CTR – minutes of engagement.
Creative versioning - see their story
Order product with remote
Request samples/coupons.
Strategic Opportunities1. Remix media to consumer consumption
10
Strategic Opportunities
Recognition & personalization create differentiation opportunities
Real-time recognition – registration, cookies, IP, linking
Dynamic personalization – versioning. offers. testing
CMR Preference centers. Infocards
4-15X returns possible
Digital product opportunitiesMany products are digital – content, handsets, eReader
Leverage messaging opportunities. Education. Service. Offers.
Create subscription businesses. Content anywhere
Liberate/distribute content. Let customers distribute for you.
Distributed commerce. Do business wherever your customers are
Apps/widgets. Brand engagement. Consumer insights
2. Invest to enable recurring revenue & customer engagement
11
Strategic Opportunities
Harvest overlapping & interrelated effects
TV was the tribal camp fire – now just another light source
Attribution Framework unlocks media effectiveness
Reach with certainty80% online advertising fails to reach intended audience
Reach just your audience – 200M online, 86M email, 40M mobile
3-5x revenue/ad dollar.
RelevanceRight audience (and just them)
Right message (content versioning)
Right time (trigger-driven).
Engage in Surround Sound. Cross media institutional memory
3. Discipline in improving media effectiveness
Combine direct skills with digitalLeverage cross-channel insights – customer behavior & value
Leverage direct methodology – targeting, testing, measurement, etc
Leverage cooperative ventures – list/data exchange.
12
Strategic Opportunities
Coordinated multichannel marketing information
Just 32% of marketing decision makers understand their customers multichannel behavior…yet multichannel buyers are 4-5x more profitable
Invest according to DVOC (differentiated value of customers)
Value varies by purchase volume, frequency, loyalty, NPS, service costs
Measure customer value. Consistent segments & metrics
Invest based upon predicted impact on CLTV
Store/utilize new forms of dataNew behavior - social conversations, online footprints, set top box data
New preferences – explicit/inferred – product, media, channel
Integrate cross-media, cross-channel insights
Harvest – measure & recalibrate
4. Recognize customer information as an asset (really)
Dig deeper (don’t settle)Mythical average customer. Interaction history, brand advocacy, interests & attitudes, life stage, ethnographic variances Changing market research role. Seeing v asking. Census v panel
Harvest – measure & recalibrate
13
Sound obvious?“… too many shortcomings to be seriously considered as a means
of communication. The device is inherently of no value to us.“
Western Union memo on potential for the telephone, 1876.
14
"We don't like their sound, and guitar music is on the way out.“
Decca Recording Co. rejecting the Beatles, 1962.
Sound obvious?
15
“Needs a stronger supporting cast.““Almost totally free from humor”
Audience testing for Seinfeld, 1989.
Sound obvious?
16
Payoff & roadmapKey payoff principles…and Acxiom multichannel investment focus
1. Correlate specific customer behavior to specific marketing investment
Enable cost-effective integration & scale via MarketEdge & AbilitecDigital
2. Recruit, recognize & harvest explicit & inferred relationships across channels
Integrate & optimize first party relationships via Impact
3. When consumers are not directly engaged with your brand, ad media relevance is key to reengagement
Integrate customer insight into digital targeting & creative via Relevance
4. Invest & engage proportional to customer value.Design & execute high performing marketing programs
5. Optimize customer value at every interaction Enable real-time decisions that improve CLTV
17
Payoff & roadmapA closer look at the differentiated value of customers
30% of customers deliver the majority of profits
50% Add nothing
20% Cost companies money
SAS
18
Payoff & roadmap
Cadillac
AllstateHershey
American Express
PersonicX Consumer Segments PersonicX Consumer Segments
PersonicX Consumer Segments PersonicX Consumer Segments
UV
Inde
xU
V In
dex
UV
Inde
xU
V In
dex
A look at site traffic at world class brands
19
0
50
100
150
200
250
300
Shopped at Banana Republic
0
50
100
150
200
250
300
Ordered from BestBuy.com
0
50
100
150
200
250
300
350
Ordered Flowers online
0
50
100
150
200
250
300
350
Shopped at Ann Taylor
UV
Inde
xU
V In
dex
UV
Inde
xU
V In
dex
PersonicX Consumer Segments PersonicX Consumer Segments
PersonicX Consumer Segments PersonicX Consumer Segments
…and consumer shopping behaviorPayoff & roadmap
20
MSN96 MM UV’s
AOL70 MM UV’s
eBay56 MM UV’s
Yahoo148 MM UV’s
PersonicX Consumer Segments PersonicX Consumer Segments
PersonicX Consumer Segments PersonicX Consumer Segments
UV
Inde
xU
V In
dex
UV
Inde
xU
V In
dex
Acxiom, comScore
Profile of traffic is much different at major online sitesPayoff & roadmap
21
0
50
100
150
200
250
300
0
50
100
150
200
250
300
0
50
100
150
200
250
300
UV
Inde
xU
V In
dex
UV
Inde
xU
V In
dex
PersonicX Consumer Segments PersonicX Consumer Segments
PersonicX Consumer Segments PersonicX Consumer Segments0
50
100
150
200
250
300
ABC
NBC
FOX
CBS
…and at broadcast networksPayoff & roadmap
22
80% of online advertising fails
to reach its intended audience
Payoff & roadmapTraditional media buy = FAIL on a massive scale
23
Payoff & roadmap
DVOC-led Traditional VarianceCampaign CostImpression Volume 37,500,000 100,000,000Cost per Thousand 8.00$ 3.00$
Total Campaign Cost 300,000$ 300,000$ -$
Revenue GeneratedRevenue/conversion 500$ 250$ Purchase rate 0.020% 0.010%Total Purchases 7,500 10,000
Total Revenue 3,750,000$ 2,500,000$ 1,250,000$ 50% higher
Total Revenue/Ad Dollar 12.50$ 8.33$ 4.17$ 50% higher
CLTV 4,000$ 1,250$ Total CLTV Impact 30,000,000$ 12,500,000$ 17,500,000$ 140% higher
PremiseConcentrating impressions on high value visitors…>Enables higher conversions (message is more tuned) >Enables higher revenue & CLTV/ad dollar (visitors buy more)
Concentrate on just your audience. Sample ROI Model
24
25
Payoff & roadmap4x “orders per thousand”– Connecting print & digital
3x applications; 5x online revenue; same head count– Connecting call center & digital
2x online bookings– Connecting outbound & website
7.5x website spend– Connecting mobile & email
17x response– Connecting TV & offline
$200M revenue / $4.5MOpEx savings – Connecting call center & digital
$100M/yr EBIT impact– Multichannel connection
9-figure/yr revenue impact– Multichannel connection
Huge payoffs are achievable
26
What could have been
Portable Music
owned
but couldn’t become
On-Demand Info
owned
but couldn’t become
Movie Inventory
owned
but couldn’t become
It’s not enough…A great customer baseA great productA great strategyA great team
Darwin always wins.
Will you?
27
The global interactive marketing services company
Thank you.
www.facebook.com/acxiomcorp
www.twitter.com/acxiom
www.linkedin.com/companies/acxiom
www.youtube.com/user/AcxiomCorporation
www.delicious.com/Acxiom