Finely Tuned Marketing
NEW ORLEANS -- It's only fitting that the Big Easy is immersed in its annual Jazz & Heritage Festival this week, as marketers are also "getting jazzed" here at Unica's Marketing Innovation Summit 2008. Unica Chief Executive Officer Yuchun Lee opened the week's happenings with a keynote address this morning that conveyed the changing landscape of marketing -- delivering his version of the marketing "Ps," and what the changes mean for marketers.
If there's one thing that's constant, it's the fact that marketing is changing. Marketers have heard it over and over again, but unfortunately, the traditional is still dominating the industry. Marketers are still shouting, Lee told the audience, and as a result, consumers are just hearing noise. Nevertheless, he describes three imminent overarching trends that will slowly but surely push marketers to provide increasingly more relevant messages:
- Power shift to the consumer: There are 1.3 billion people online. In North America, 70 percent of the population are online, twice as many as those watching television. With the availability of the Internet, Tivo, and digital video recorders (DVR), Lee remarked, "My kids never watch live television anymore."
- Increasing Marketing Complexity: with the proliferation of marketing channels, what was once a linear customer shopping funnel has become a convoluted maze; and
- Shift in global spending:Approximately $1.2 trillion dollars is spent on marketing worldwide, 42 percent of which is invested in traditional advertising, $294 billion in direct marketing, and $33 billion in Internet marketing. While $33 billion is by no means a small amount, it's incompatible with consumer shopping habits. Nielson research shows that 85 percent of online users have made an online purchase. Moreover, over 80 percent of online consumers buy offline and spend more when they do, and 54 percent of consumers researching offline buy online.
In response, Lee declared the four "Ps" of marketing -- product, price, place, and promotion -- antiquated, now being supplanted by a new quartet of marketing fundamentals:
- product and price now become personalization: "[Marketers] need to give consumers options and choices that suit their needs," not the products they want to sell;
- place becomes presence: Marketers can no longer expect to keep the conversation on company territory. Presence includes online reviews, chat room discussions, product recommendations, as well as online keywords;
- promotion needs to be persuasion: Lee described persuasion as "softer, gentler," and being helpful rather than forceful; and
- finally, permission: consumers are giving marketers permission to speak to them, which is the best guarantee that they will listen in return. Permission also relies on building trust with the consumer and ensuring that their information is secure behind your walls. In addition, Lee added, anonymity should be respected as it gives consumers the virtual personal space they require.
In the end, the goal is to create a dialog that delivers relevancy. Listen, understand, then speak, Lee said. Pretty abstract, he admitted, but it's a solid framework to build upon. The next step is to dissect the marketing process and find the technology to make it not only possible, but automated. The pervasiveness of customers on the Internet is converging online and offline worlds, forcing marketers to modify their tactics. At this watershed, Lee told the audience, "you are in a once-in-a-lifetime position to affect change in an organization."
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