© Koen H. Pauwels 2013 / / / 1

The cure for schizophrenic marketing:PROF. DR. KOEN PAUWELS

Marketing based on full consumer boulevard

© Koen H. Pauwels 2013 / / /

Schizophrenic mixing of the old and the new

© Koen H. Pauwels 2013 / / / 3

Is your organization suffering from

1) Confusion about effectiveness new media ?2) Lack of comparable metrics online vs.

offline ?3) “You are too young / too old to understand”

authority instead of fact-based arguments ?4) Resource competition between online and

offline marketing without a clear attribution ?

Global % of firms to fully deploy digital

Brand position consistently in on-line and offline channels

Engage customers in social media throughout process

Run web experiments to test marketing effectiveness

Big data analytics to improve planning or forecasting

0

10

20

30

40

50

60

70

80

2012 2013

Source: McKinsey Global Survey August 2013

but Europe & Emerging lag in digital spent

Source: McKinsey Global Survey August 2013

NORTH AMERICA ASIA EUROPE EMERGING

3931

26 29

15

69

8

11

1413 9

35

49 52 54

3% or more 2%-3% 1%-2% Less than 1%, NA

© Koen H. Pauwels 20123/ / / 6

Coke measures expressions and impressions

“Customers have become empowered to create their own content and share it. It has changed my role as the CMO as we work to double business by 2020.”

“Consumer impressions will remain the backbone of our measurement because it is the metric universally used to compare audiences across nearly all types of media.”

“In addition, we are tracking consumer expressions; i.e. any level of consumer engagement with our brand content. It could be a comment, a "like," uploading a photo or video or passing content onto their networks.”

The Classic Purchase Funnel in Marketing

as tracked in attitude surveys (GfK, Kantar)

…explains brand sales beyond marketing actions

Panel B: Decomposing Sales and its Dynamic Drivers (Full Model)

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Sales Marketing Mix CompetitiveMarketing Mix

Mindset CompetitiveMindset

% d

ecom

posi

tion

Srinivasan, Pauwels and Vanhuele (Journal of Marketing Research 2010)

© Koen H. Pauwels 2012 / / / 10

But many now say classic funnel is dead

replaced by online decision journey (McKinsey 2009)

Focus of my research on metrics

• Online Behavior and Attitude Survey metrics:1) How well do they EXPLAIN brand sales?2) How well do they PREDICT brand sales?3) Does this differ for high vs low involvement?4) How can marketers affect the key metrics?5) Can we integrate attitudes & online actions?

Data thanks to Dutch GfK, Google and SDL

36 brands in 15 categories: durables (cars), services (internet, energy, travel, lodging, insurance), food (cheese, butter, snacks, candy, dairy, beer, soft drink) non-food (tissue, sanitary napkins) packaged goods

Categories differ in involvement, durables + services score 4-7, FMCGs 2-3 on a 7-point expert scales

Brands vary greatly in online spending: from 0.5% (a salty snack brand) to 84% (softdrink), mean is 30 %

We combine both funnels and marketing in a Dynamic System

Accounts for short and long

term effectsVolume sales

Environment

Marketing

Price Promotion

Distribution Advertising

Classic funnel

Loyalty

Preference

Awareness

Consideration

Intention

New funnel Owned

Paid

Earned

Key Results

1) Online metrics great to EXPLAIN brand sales2) Attitude surveys best to PREDICT brand sales3) Online metrics matter more for products with

high involvement & online active brands4) Both online and offline marketing can affect

online behavior and attitude to raise sales5) You can integrate attitude & online metrics

Durable/Service Sales get stronger boost from online

Clicks

Branded se

arch

Generic se

arch

#Web visit

s

#Pagevie

ws per v

isitor

#Pos web co

nversa

tions

#Neg web co

nversa

tions-0.100.000.100.200.300.400.500.600.70

0.05

0.14 0.14

0.030.08

0.01

-0.03

0.36

0.45

0.29

0.600.57

0.01

-0.02

FMCG Durables&Services

How to read? If clicks

increases by 1%, volumes

sales increase on average

by .36%

TV most effective offline action to lift online behavior, even outperforms online on pageviews & social media

Clicks

Branded search

Generic search

#Web visits

#Pageviews per visit

or

#Pos web co

nversations

#Neg web conversa

tions0.000.100.200.300.400.500.600.700.800.901.00

0.17 0.17 0.170.25

0.19

0.74

0.07

0.95

0.71

0.510.41

0.00

0.70

0.20

TV Online

How to read? If TV expenditures increase by 1%, # website visits

increase on average by .25%

How to score online with offline TV

Creative, Consistent, Complement

1) TV ad with Isaiah Mustafa around Superbowl

2) You Tube and fan response

3) Isaiah answers on YouTube> 100 M views, > 30 K twitter

Old Spice sales double in 1 y

• Does your guy smell like Old Spice Guy ?

Attitude-online effects go both ways

Web visits

Paid clicks

Branded search

Awareness

Consider

Preference

Attitudes Awareness & Consideration drive later online behavior, but online behavior also drives later Awareness and Preference how to integrate the funnels ?

Consumer Boulevard: Slow moving attitudes and fast online actions

Web visits

KNOWCOGNITION

Aware

Consider Buy

LIKEClick

Visit

AFFECT

Prefer

Loyalty

Experience& Express

DOSearch

| 22

Dashboard input and output for managers

| 23

Comparing profit from saved scenarios

“It’s not the size of your data, it is how you use it: Market Smarter with Dashboard and Analytics”

• Your free sample at: koen.pauwels@ozyegin.edu.tr

• Website: www.marketdashboards.com (also in Turkce)

• LinkedIn/Twitter: koenhpauwels

• Facebook: http://www.facebook.com/pages/marketdashboardscom/207532115957700

24

Want to learn more? My new book:

Key take aways

1) Online behavior metrics add to sales explanation but attitude survey metrics are key to sales prediction

2) Online behavior metrics crucial in high-involvement settings, but also matter in low-involvement products

3) TV and online marketing most powerful in driving attitudes and online behavior metrics

4) Cross-funnel effects go both ways, rethink the path-to-purchase as a boulevard with fast and slow lanes