2010: The Year Marketing Dies…

Image by yewenyi via Flickr

…(Subtitled) Or at Least Marketing as We Know It!

It is that time of year when every blogger, reporter and analyst is publishing their 2010 Social Media and marketing predictions.  (It's a rather odd phenomenon–aren't we interested in what's happening in the next twelve months other than in December?)  Forrester's own Social Media prediction report will soon be released, but I'd like to make my own big prediction:  2010 will be the year marketing–as we know it–dies.  Let's explore the trends and what they mean to marketers. 

Marketing's been under attack for some time, but in 2009 we witnessed the most profound evolution the marketing world has seen in fifty years or more.  The pace of change is not going to lessen in 2010.  Core elements that have driven marketing practices for decades–such as messaging strategy, mass media, PR, advertising, and others–will continue to change rapidly. 

The latest news from the print world is unsurprising:  Average weekday circulation at 379 U.S. newspapers fell 10.6% during the six months ending in September–the steepest decline ever recorded by the Audit Bureau of Circulations.  And although a recent study found that consumer spending on subscription media increased 7% in the past year, that didn't mean subscriptions in the traditional sense–the number of households subscribing to magazines dropped two percentage points while subscriptions for home video and smartphone services were both up. 

On the television front, households with DVRs tripled in just three years, more consumers are avoiding ads, and a majority feels there is "too much advertising."  One cannot help but feel sorry for networks and media companies worried about matching ad revenue to expenses, but their response is a bit hard to swallow. TiVo is showing ads to viewers as they are trying to skip other ads, and TNS Media Intelligence tells us that "marketing content represents 43 percent of a prime-time hour"–11:46 minutes per hour of in-show Brand Appearances (a 31% increase from a year ago) and 14:07 of network commercial messages. 

Certainly, someone has to pay for Fringe, Glee, and The Office to be produced, but chasing down consumers and bludgeoning them with more advertising messages hardly feels like an effective strategy. (By the way, I selected those three shows for a reason: according to the latest Entertainment Weekly, almost one in five people viewing those programs is time shifting, and you can guess what that means for advertisers.)

The story on the Internet isn't much better.  Hulu is striving mightily to avoid being forced to go the way of TV and load their content with more ads.  Social Media sites like Facebook are so loaded with ads that a consumer spending ten minutes on the site might be exposed to as many as 90 easy-to-ignore ads.  To improve low attention and meager clickthrough rates, advertisers hope to enhance their targeting of consumers based on their online behavior, but the long-threatened intervention of the government may be at hand.  This year could finally be the year that the Feds change the way online advertising works; said  FTC Chairman Jon Leibowitz recently, "We're at another watershed moment in privacy, and the time is right for the commission … to take a broader look at privacy." 

Marketers have, of course, taken note of the power of Social Media, but they continue to struggle with what to do and how to measure it.  In a recent study, 64% of CMOs said they plan to increase their social media budgets next year, but "at least half of respondents expressed uncertainty about ROI."  It strikes me as quite concerning that the top metrics being utilized–mentioned by more than 80% of the CMOs–aren't deep measures of influence or attitude but shallow measures of presence, such as number of fans and page views.

Meanwhile, it's possible (although not likely) that the Social Media landscape could change yet again if Facebook stumbles in 2010. (Don't think it could happen?  Remember that 13 months ago MySpace was drawing more visitors than Facebook;  today Facebook draws 150% more than MySpace.)  Facebook is facing potentially serious challenges.  Some are predicting that young people could soon stream off the site to avoid status updates from mom and dad; by one report, just 50% of the 15-24 crowd is checking Facebook regularly, compared to 55% last year.  More people are complaining (and suing) about being caught in scams from third-party developers on Facebook.  And faced with the growing privacy concerns of its users, how did Facebook react?  By implementing changes that many feel make it not just more difficult to protect their privacy, but actually remove privacy protections from some sorts of data. 

Facebook seems unlikely to go the way of Friendster (if for no other reason than a serious competitor has yet to emerge), but even if Facebook finds itself being MySpaced in 2010, Social Media is here to stay.  The influence of the masses will only continue to grow as Social Media tools improve and more and older consumers climb the Social Technographics Ladder, moving from Inactives, Spectators, and Joiners to Collectors, Critics, and Creators.  

Social Media has just begun to change the way marketing and business operates.  The coming year will see advertising put under the microscope by a connected, savvy, and critical consumer (just ask Motrin and Unilever).  Consumers will use Social Media to exert more influence over marketing and business decisions (see Tropicana and EA).  The best practices for brands in Social Media will continue to evolve (and woe be to brands caught violating consumer trust, as demonstrated by recent missteps by individuals at Honda and Belkin).  And some multi-million-dollar marketing budgets will be challenged and undermined by simple consumer-generated videos (see the Domino's employee video–or better yet, don't!) 

 As we enter 2010, consumers have new partners that will help to expand the reach of Social Media dialog even further–the big three search sites.  Bing, Yahoo and Google recently made changes to the way their search engines index the real-time web, and status updates and tweets are rapidly finding their way into top search results.  This means that consumers searching for brands and campaigns are increasingly likely to see results that include blogged and tweeted criticisms as they are links to official brand sites. 

The search engine changes mean that 2010 will be the year when brands can run but they cannot hide.  Gone are the days when marketers could carefully craft messaging and then broadcast that message in a few channels to huge portions of their audiences.  Oh, you can still spend money that way if you want to but in our transparent world, no marketing budget can possibly overcome the actual experience consumers have (and share with friends, followers and Google) with the product, service, or organization.  It no longer matters what you say;  in 2010, your brand will be more defined by what you do and who you are! 

Of course, if marketing burns to the ground in 2010, a new and more powerful marketing will rise from the ashes.  The role of the new marketer:

• Won't be simply to focus on outbound messaging but to consult with sales, customer service, and human resources on how the brand must be communicated in every consumer interaction, every tweet, and every touchpoint,
• Won't be merely to imagine creative messages but to fashion programs that are seamless with the actual product and service experience,
• Won't be to plan bursts of communication on a yearlong calendar but to respond to and be part of the ever-changing dialog with consumers, 
• Won't be to count friends, page visits, eyeballs, readers, or viewers but to measure changes in consumer attitude and intent,
• Won't be merely to talk at consumers but to listen and engage one to one,
• Won't be to build campaigns but relationships,
• Won't be to create impressions but experiences, and
• Won't be buy media but to earn it.

To some of you, these changes sound easy, but they represent painful transitions for marketing organizations.  In 2010 and the years that follow, everything will change:  job expectations, skills, metrics, structure, budgets, agency demands and compensation, and the role of the marketing function within the organization.  While the changes will be difficult, they will also be extraordinarily exciting.  In the end, the marketing organization will be integral partners in everything the enterprise does, living up to Peter Drucker's famous quote:

"Business has only two basic functions — marketing and innovation."

Marketing is dead.  Long live marketing!

Defining Earned, Owned And Paid Media

[Posted by Sean Corcoran]

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The terms "earned, owned and paid (aka bought) media" have become very popular in the interactive marketing space today. In fact, taken together they can be applied as a simple way for interactive marketers to categorize and ultimately prioritize all of the media options they have today. Nokia was an early pioneer in this space (see Dan Goodall's posts on the subject). They now categorize all of their global interactive media as earned, owned or bought. Many agencies, including R/GA, Critical Mass, Sapient and Isobar (my former employer) also use the model to help develop digital strategies. On top of that, many industry leaders such as Pete Blackshaw, Fred Wilson and David Armano have written about the subject.

Yet as popular as these themes have become, they're often loosely applied across the industry and essentially no one is speaking the same language. Therefore we just published research defining each type of media and providing interactive marketers with prescriptive advice on how to best apply them. Here's a summary of how we defined each type of online media and their roles:

 

Ultimately these types of media work best together but making the hard choices of what to include and what not to include is crucial – especially when budgets are tight. But if you simply start by categorizing your media and identifying the right roles based on your objectives, then your on the right path. Here are some high level takeaways that you should consider when developing your 2010 interactive media strategy:

• Create a solar system of owned media. Owned media is a channel you control. There is fully-owned media (like your website) and partially-owned media (like Facebook fan page or Twitter account). Owned media creates brand portability. Now you can extend your brand's presence beyond your web site so that it exists in many places across the web – specifically through social media sites and unique communities. In a recession in which marketing budgets are being cut by 20%, the ability to communicate directly with consumers who want to engage with your brand through long-term relationships can be invaluable.  
• Recognize that earned media is a result of brand behavior. "Earned media" is an old PR term that essentially meant getting your brand into free media rather than having to pay for it through advertising. However the term has evolved into the transparent and permanent word-of-mouth that is being created through social media. You need to learn how to listen and respond to both the good (positive organic) and bad (spurned) as well as consider when to try and stimulate earned media through word-of-mouth marketing.
• Your paid media is not dead, but it is evolving into a catalyst. Many people are predicting the end of paid media (aka advertising). However, that prediction may be premature as no other type of media can guarantee the immediacy and scale that paid media can. However, paid media is shifting away from the foundation and evolving into a catalyst that is needed at key periods to drive more engagement(e.g. Q4 holidays).

Will the DSP Kill Ad Networks?

     Some of you may know that I started my career in interactive marketing at Advertising.com, now part of AOL Media. I have a soft spot for the "good kind" of ad networks, those who keep the advertiser and publisher interests in mind, who strive for good quality advertisements and content, and who have killer optimization and targeting technology. I have always looked at ad networks as a key technology driven service who fills important needs for both the buy and sell side. However, within the past six months or so, I see fewer and fewer of these networks making headlines, being the topic for discussion at forums or, most importantly, on the lips of interactive marketers. 

Instead, I hear more and more about the rise of the demand side platform or "DSP." (Full disclosure: my husband works at one of them.) But it's not my husband who has convinced me of this sea change (although don't tell him that!)  Rather, it's the marketers themselves who are embracing the data and advertiser driven DSP model. There are many companies who call themselves DSP's, some already established like AdChemy, x+1 and Media Math but there are others are cropping up recently including Turn, DataXu, AppNexus and others. Most have a combination of optimization and data targeting that is geared for marketers, with a buying strategy that mostly takes advantage of inventory on ad exchanges. What will separate winners from losers are quality of the services and technologies that make up the offering. In other words, are they easy to work with and do they provide results?

With the rise of independent DSP has also come a crop of automated buying platforms created by the agencies, including Vivaki, WPP's B3 and Havas' AdNetic. Many in the industry wonder if agencies have the technical and analytical chops to compete with the independent shops. But no one denies that they have great positioning in the market, already working with the very advertisers the product is meant to serve.

It's very possible that these two forces in the industry will replace what ad networks have done for marketers in the past. Certainly, my alma mater, Ad.com no longer exists the way it once did.

Look for a lot more research on this shifting landscape in the near term from Forrester.

Guest Post: Tom Cummings on how marketers are using Twitter (and what they can do better)

As a Forrester analyst I get to work with a fantastic team of researchers – including Tom Cummings, who contributes some great work to our research on social media marketing and a wide range of other topics. Below, Tom discusses a piece of research we collaborated on, covering how marketers are using Twitter:

[Posted by Tom Cummings.]

We recently published WebTrack review of how major companies are using Twitter. Over a span of three days in
October, we tracked 30 marketers on Twitter to see how they named and branded
their accounts, how often they tweeted, how they interacted with other
Twitter users, and more. We didn't just study the most popular accounts on Twitter –
instead, we looked for a broad sample of accounts across key industries (including retail, travel, financial services, auto, and CPG).

For the most part, brands get the basics right. 
The large majority interact with followers (more than three-quarters of the brands we tracked reply and retweet). And most fill their streams with a steady flow of relevant content (80% tweet at least daily). We especially liked seeing companies go beyond traditional marketing messages – like when State Farm promotes fire alarm safety or when Ford gives behind-the-scenes perspective on their new engineering processes.

But while most get the basics right, many branded Twitter accounts still fall short
on some key points.  For instance, it’s surprisingly difficult to
find the appropriate account for many brands.  Neither Google nor Twitter search offer an ideal way to find a company's official account – and often, a company's official primary account isn't the most active or the most followed.

We were also surprised that only half of the accounts we
reviewed “validate” their Twitter page.  It's not enough to link from a Twitter account to a corporate page – those corporate pages must also link back to
the account to prove that the account is official.

We like how Whole Foods – which runs more than 100 official accounts – handles both of these problems: They keep their primary account name simple and searchable (@WholeFoods) and link from that account to a list of all their other accounts. Other marketers should follow suit – because it’s up to them to prove the authenticity of their account
(no matter how many followers they have) and to make it easy for fans to find the right account to follow.

Clients can read more examples and findings in the full report. In the meantime, we’d love to hear how your brand is using Twitter, how you let
fans know about the account, and what other tips you have for best leveraging the power of Twitter.

Online Canadians Have Aggressively Embraced Social Technologies — And So Have Canadian Marketers

[Posted by Nate Elliott. Follow me on twitter.]

I've spent the last year living and working in Vancouver, Canada — speaking with many Canadian interactive marketers and agencies, and collecting survey data on Canadian consumers — so I'm pleased to say that yesterday we released a new report, Canadian Social Technographics Revealed, and added our latest Canadian data to our free Social Technographics Profile Tool.

In researching this report, I learned that:

• Canadians are the most active social networkers in any market we survey. In our Social Technographics Ladder, we refer to those who regularly use social networks as 'joiners.' And Canada boasts a higher percentage of joiners than any of the other 12 countries we regularly survey: 57% of Canadians told us they use social networks at least once each month. (The next strongest social networking market is the US, where 51% are joiners.) Canada also has more 'creators,' critics,' and 'spectators' than many other countries. [An edit to avoid confusion: while Canadians are the strongest adopters of social networks we've found in our surveys, they are not the strongest users of social media overall (which would include not just social networks but also blogs and other social platforms) -- that would be the South Koreans.]
• Many Canadian marketers have been using social media for years. With all those socially engaged consumers, it's no surprise Canadian marketers have been pretty aggressive in adopting social media too. The report includes several great examples of marketers successfully using social media, and I found that some of the most innovative marketers (like Vancity and Molson) have been leveraging social media for 3 or 4 years now.

One of my favorite examples of social media marketing in Canada comes from the political realm. NDP leader Jack Layton recognized that his followers were among the most socially engaged in Canada, as you'll see below. So he used Facebook, Twitter, and YouTube to energize NDP voters before the 2008 federal election — and that helped the party gain 31% more seats in Ottawa than they'd had in the previous government.

Go and have a play with our Social Technographics Profile Tool and you can find free cuts of this data by age and gender. (Clients can also ask us to cut the data by other factors, like where people bank, which mobile carrier they use, or what province they live in.)

And if you've got any other great examples of social media marketing in Canada, let us know in the comments below.