Interactive Marketing Nears $55 Billion; Advertising Overall Declines

[Posted by Shar VanBoskirk]

I'm pleased to announce that Forrester's five year forecast is now complete and live on Forrester's site.  It feels like this has been a long time in coming from my side too! Please see the full report for detailed explanations of the trends affecting overall marketing budgets and the growth of the channel in the forecast.

You may remember we previewed our forecast at Forrester's Marketing Forum at the end of April.  If you cross reference this post to the one we posted as follow up to the forum, you will notice that the "% of all advertising spend" has changed.  The absolute forecast is still the same, we just changed this calculation to make sure it was done in the same way as in years past. See below for the most recent release:

  

This research will certainly help marketers plan their channel strategies.

• Search continues to lead interactive spend followed by display. 

• And owned social media assets (like internal blogs, community sites) are really the only emerging media getting traction in today's economic climate.

But to me, the most interesting takeaway from the research is that overall advertising budgets will decline.  Yep.  With dollars moving out of traditional media toward less expensive and more efficient interactive tools, marketers will actually need less money to accomplish their current advertising goals.   But reasonable marketers won't relinquish budget because their programs are running too efficiently. Instead, marketers will allocate unused advertising dollars into investments like innovation, research, customer service, customer experiences, and marketing-specific technology and IT staff, in order to further marketing's strategic influence within their companies. 

Interactive Budgets Are Growing At The Expense Of Offline

[Posted by Shar VanBoskirk]

During my presentation at Forrester's Marketing Forum on April 23,  I previewed Forrester's latest forecast of interactive marketing spend.  We expect marketer spend on display media, search, email, mobile and social media to reach nearly $55 billion by 2014.

  

This growth is due to marketers seeking lower cost, more accountable channels which are also widely used by their customers.  This year, we are also finding that marketers are migrating dollars away from traditional channels and into interactive ones.

  

Direct mail and print are suffering the most loss to interactive tools.  According to our survey, 40% expect to cut direct mail budgets, while 35% will decrease newspaper spend and 28% will slash magazine money in order to spend more in interactive media.

 

I'm actually currently at work on Forrester's full forecast report detailing the growth trends around each of the channels itemized in this forecast.  Look for that report -- which will include additional data and explanation -- on our site around the first part of June.

Marketing Forum Theme Day 2: Engaging the Innovative Customer

Forrester's Marketing Forum in Orlando Florida, see other photos tagged FMF09 Yesterday's theme was to take risks and engage in innovation --even in times of economic hardship. Armed and excited with examples from the speakers and panels, the conference was now focused on the 'how to', with a focus on engaging your customers to be involved, guide, and lead your company in tandem with your own leadership.

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Forrester's Peter Burris: Engaging the Innovative Customer First we heard from Forrester's Peter Burris, who focused on the theme o engaging your innovative customer, he suggested that as you take risks, let your innovative customers be your guide. The conference focus met the needs of multiple industries, and Peter gave data and insight not just how B2C can win but how B2B customers’ reliance on each other –and social tools – changes the marketing game. He referenced IBM's Sandy Carter's programs as best in class for bringing community into the forefront of B2B marketing including how they've integrated community into next week's IMPACT event. Peter brings forth a framework to help marketers plan for innovation: PLOT a path forward, which includes: Persona, Develop customer needs through social interactions, Location: Allow customers to create groups, and gives the example that Adobe hosts 700 user groups. Serena software embeds customers in its development & launch processes. Then Option and finally, Test. 

His recommendations were very clear for engaging innovative customers:

Position marketing as a resource that B2B customers can use to drive better business outcomes.

Blend social media with traditional tactics to create new marketing forms –and new levels of productivity.

Align marketing and development to lower the risks

Ending notes: Innovative customers are ready, willing, and –thanks to social media—able to guide your efforts to manage risk.

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Case Example: Microsoft's Craig Dewar on Community Next, we heard from Craig Dewar of Microsoft, hailing from New Zealand, he discussed how Microsoft has engaged. His first example, Craig gives the example how Microsoft launched a gaming console into a saturated market where Sony was a leader, and they launched the Xbox product. Each Xbox user can establish their own online identity and can interact with others. As each new game came out a new forum and dialog was formed. The second example is Channel 9 an online community for developers. The third example is Microsoft Dynamics Community, a CRM tool. The goals are: learning, networking, support, and feedback. Lessons learned

• Even if you build it, they may not come.
• Critical Mass in a community is hard and will take longer than you think.
• You won't get community right, so be prepared to optimize.

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Want to learn more? Blog Coverage from David Berkowitz Long time friend David Berkowitz covered the many sessions, and even was adding pictures in near real time in his live blogging. Pretty dang impressive, even if I may say so myself. See all his posts that are tagged "conferences" to get more detailed coverage of the event. You can also see the hundreds of tweets tagged FMF09, and if you live blogged any of the sessions, leave a comment below.

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Jeremiah's Wrapup I enjoyed this year's show, it's amazing that we had around 500 attendees registered even during a tight economy, it goes to show that now is the time for marketing to step up and innovate. I enjoyed having dinner with clients and drinking a bit too much EJ Gallow wine, heh. I was told that we had a wait list of over 30 vendors that wanted to be in the showcase, it was currently filled to capacity, so the demand for partners who wanted to help brands is clear. It was universally said that Forrester's Shar stole the show, even with her opening musical rendition (see video from day 1). I quick Forrester factoid, Forrester keynotes are encouraged to rehearse 20 times, many times in front of colleagues. We've already several more forums lined up, including the Marketing Consumer Forum in Oct in Chicago, see you there.

Here's the archive of the live ustream of Day 2 opening keynotes.

Lastly, for attendees, you can login to the Forrester site using your password sent to your before the event to access the presentations.

Marketing Forum Theme Day 1: Do Marketing Differently: Innovate During A Recession

Written by Jeremiah Owyang, Zach Hofer-Shall 

Forrester's Christine Spivey Overby kicked off the conference, first reminiscing on how great innovation comes out of times of economic struggle. Her example, which is so suited for Forrester’s marketing conference in Orlando, is Walt Disney’s creative genius to develop an iconic entertainment franchise. She stresses that now is the time to do marketing differently by thinking differently and embracing innovation.

Marketers should innovate now, despite the perceived risk. 

Why innovate now:

VP/Principal Analyst on the Interactive Marketing team, Shar VanBoskirk spoke next. She indicates that a recent forecast shows that mobile, social, email, display, and search marketing will increase at a CGR of 17% in 2014. She gives some funny examples of some silly Twitter examples from overzealous customers. Risks: we take them because of the thrill, or the innovation. 

Accessible innovation: A marketing program development that you can pursue within your own role in order to solve problems or improve business results.  It’s not limited to your CMO or your corporate strategy group. An accessible innovation should have the following traits:

• Enhance:  Replace incumbent channel with an unproven one.  
• Include: Incorporate community perspective
• Empathize: Relating to your community
• Iterate: Speeds developing

Shar notes that BestBuy’s remix is a great example of innovating during a recession.  They’ve provided an API for third party developers – I’ve outlined the program – the most unique is GPS discovery tool and Camel. With all innovation comes risk, in Best Buy’s case the risk is letting anyone use brand assets. 

Shar has provided a worksheet for attendees that can help brands identify innovation, and access the risk that comes with it.

7-11 Takes Risks with Simpsons tie-in
Next, we had Rita Bargerhuff, the VP of Marketing, discussing how 7-11 takes risks. She outlines there are four requirements before diving into risk:  1) is it right for your Brand 2) is it right for consumers 3) is it right for internal stakeholders and 4) Is it right for the environment.

Rita eloquently gave a case study of how they aligned the 7-11 brand with the popular Simpsons movie, which while was risky as the show paints “Kwik-e-mart” in a culturally sensitive parody, see a public flickr set. Taking the risk required intensive stakeholder buy-in, which resulted in movie tie-ins, movie product tie-in (squishee), and even creating a Kwik-e-mart store. Did it pay off? Yes, there were lines wrapped around the store to get into the store. 

Her closing remarks? “Success leads to success You’ll attract new business partners” well spoken.

Above: Here's a ustream recording of the opening keynote.

See you in Orlando: Forrester's Upcoming Marketing Forum, April 23-24, 2009

[Posted by Jeremiah K. Owyang]

The Forrester team is gearing up for yet another great Marketing Forum, this time, in Orlando, Florida. We've carefully selected speakers to take on the hard topics of the recession, ROI, and taking risks.

We've got a strong line of speakers that include Marty St. George, SVP of Marketing for JetBlue, Greg Clayman, EVP of Digital Distribution for MTV Networks, and Annis Lyles, VP of Media and Interactive for Coca-Cola North America. Including presentations based on latest research from Shar VanBoskirk and Peter Burris.

The venue is located at the Disney's Yacht & Beach Club Resorts in Orlando, and if you can take your family, you can not just get educated and network, but enjoy some Florida sun.

To sweeten the deal even further, Forrester has cut $300 from the event price and is offering a free night at the hotel.

The night before the official event, we'll be assembling some of the local social media practitioners at a Tweetup on the night of the 22nd, where you can come and learn, network, and meet with online influencers.

A Bad Economy Is The Right Time To Catalyze Marketing Change

[Posted by Shar VanBoskirk]

The theme for my speech at Forrester’s marketing forum on April 23-24 in Orlando this year is that the down economy is actually the *right* time to catalyze marketing change.  Instead of hunkering down and trying just to maintain marketing status quo, my assertion is that marketers should actually take risks during the recession.

 

I tested the idea and some of my research to date with a few bloggers well known for their own thinking on marketing innovation:  David Berkowitz and BL Ochman. 

 

Overall, they agreed with the notion and made a few very interesting points that I am going to try to flesh out into the speech.

 

1)       First, leveraging interactive tools can actually make marketing innovation *less* risky.  Berkowitz mentioned – and I agree – that doing things like monitoring Twitter for what is being said about your brand or campaigns is actually an extremely *safe* thing to do.  Although Twitter sounds all newfangled for a traditional brand, it provides a way to listen to how your audience is talking about your brand.  Heeding this input can help marketers actually be better/more secure in crafting customer-centric marketing programs. 

2)       Leveraging social media gives brands enough of a personal face, that consumers are willing to forgive their peccadilloes.  I hadn’t thought of this benefit of social media.  It has its value in allowing marketers to listen and speak with consumers.  But it also has an opportunistic value.  The theory is that consumers will be more tolerant of customer service gaffes from marketers who talk to them like a fellow human (eg, via Twitter, blogs).

 

The conversation around marketing innovation definitely hinged around social media.  We talked about Disney, Zappos, Dell, H&R Block as firms innovating well with social media.  Are there other innovations you have seen that are outside of social media?  Perhaps firms applying other interactive tools in a new or better way?  How about using interactive tools for better measurement?  I’d love to hear your thoughts on my forum theme as well and also learn about the examples you have seen that seem particularly compelling to you.  And then of course, let’s continue the conversation at the forum.  I’m on stage from 8:40-9:20 on Thursday April 23.  I hope you’ll be in the audience and then able to chat afterwards during one-on-ones or in some of the networking events.

Forrester's Marketing Conference Day 2: Understanding Your Customers Through Engagement

Designing For Engagement, Kerry Bodine, Principal Analyst, Forrester

Sitting in the front row from Forrester's Marketing Forum 2008, the theme for today's event with over 800 attendees being Marketing's New Imperative For Success: Engagement

Voices from the Audience:

• UK's Hayden, who was our virtual guest who's question was asked and answered in the Ustream Channel enjoys participating.
• David Berkowitz watches the chat room from NYC
• Adam Cohen reveals that The Future Will Be Televised...With Social Media
• David Deal comments on George Colony's keynote in Your employee, your blogger
• Commetrcs questions if Forrester conference and Twitter - does live tweeting help engage conference delegates?

Live Streaming the Morning Keynotes:
Harley Manning (Setting the Stage) and Kerry Bodine (Engagement), 52 Minutes

MicroBlogging: Twitter
Members are using their laptops and mobile devices to interact with each other using Twitter, a form of Microblogging.  Some of them are tagging their posts (called "tweets") with the event tag, you can view them all here.

Select Tweets include:

• MichelleBB : Working to get all FedEx Kinkos up to standards of brand. They welcome that feedback.  Only way they'll get better.
• MichelleBB :  Ouch!  Kerry just called out Harley's fanny pack
• melmcbride : Kerry Bodine's talk about emotional connection is amazing. I want to blog it once the vid is available as an embed
• Rumford :  @worleygirl you give away the appetizers and sometimes the dinner. people love the knowledge sharing and become loyal
• nickhuhn :  forrester CEO George Colony re: his blogging: i can't believe MSFT isn't behind typepad or wordpress as bad as they are ;)

Pictures:
Below are select images, but to see all public photos peruse this flickr tag ForrMarketing08,also see Jeremy Pepper's set, and Forrester Research's set.   Select photos, including those from Jeremy Pepper:

Forrester Marketing Conference Day 1: Understanding Your Customers Through Engagement

(Above Photo by Jeremy Pepper)

Jeremiah Owyang:  Sitting in the front row from Forrester's Marketing Forum 2008, the theme for today's event with over 800 attendees being Marketing's New Imperative For Success: Engagement

Voices from the Audience:

• Rodney Rumford is excited to blog from the Forrester Marketing Forum in LA.
• Rodney's live blogs Brian Haven's Engagement presentation.
• Marianne Richmond couldn't attend, but writes Forrester Marketing Forum 2008: Engagement and I.
• David Deal of Avenue A Razorfish wraps his thoughts on Engagement.
• Rather than Blog, Amy Worley used Twitter for her whole experience.

Live Streaming the Morning Keynotes:
Harley Manning (Setting the Stage) and Brian Haven (Engagement), 54 Minutes

Speaking of Engagement... As we live streamed from the front row, we responded to questions from the Ustream chat room.  One virtual attendee from UK (named Haydens30), asked a question on Engagement, which was then asked by Josh Bernoff at the live event and answered by Brian Haven.  There were hundreds that watched live, and over 70 were in the chat room, you can watch the keynotes in the player below:

MicroBlogging: Twitter
Members are using their laptops and mobile devices to interact with each other using Twitter, a form of Microblogging.  Some of them are tagging their posts (called "tweets") with the event tag, you can view them all here.

Select Tweets include:

• adamcohen : next speaker: Emmanuel Brown of Nike Jordan brand - he's wearing Air Jordans, love it
• adamcohen :  Engagement is the4 i's:  level of involvement, interaction, intimacy and influence over time #forrmarketing0
• Jeremy Pepper:  Engagement is close to becoming just a buzz word bc of overuse.
• Robert Scoble @jowyang 's CEO called him into the office. Now if he were REALLY hip he would have sent a Twitter message. :-)  (George reads this blog, so he'll see this)
• Alex Nesbitt @jowyang - why such an anti-social conference? You guys needs a way for people to ask unfiltered questions or text in questions. (my respone)
• Michelle BB notices the wifi straining: "need more bandwidth... "

Pictures:
Below are a few pics I've taken, but to see all public photos peruse this flickr tag ForrMarketing08,also see Jeremy Pepper's set,

Eating Our Own Dog Food
At Forrester, we preach to our clients to follow the POST Methodology, here at the forum, we've set up roles, processes, and have identified the key objectives we want to achieve by using social media at our forum, have a written plan with success metrics, and will report back to our stakeholders how the event went --both good and bad.  In the spirit of transparency, here's some of what the plan that was shared among the internal team: Energizing, rather than create most of the content, we encourage our attendees to publish, we'll link to it from this blog post.  Supporting: We encourage attendees to join our Facebook page and network with each other.  Embracing: We're using this feedback from attendees to learn how to improve our future events.

Select photos (some from Jeremy Pepper)

 

Keeping up with Marketing Forum 2008

[Posted by Peter Kim]

I'm at Forrester's Marketing Forum in Los Angeles today.  And again, I'm up at 4 am local - is this technically jet lag?  I won't be doing a lot of blogging or tweeting because my schedule's full.  However, you can get updates from a variety of sources:

- Forrester's Marketing Blog, which has an embedded Meebo chat
- Twitter - not just me, but also Jeremiah, Charlene, Josh, Adam, Amy, Rodney, Nick, Michelle, Barbara, Jeremy, and others
- Blogs:  Jeremy Pepper, Rodney Rumford, Jennifer Jones, Marianne Richmond
- Photos on Flickr

If you're here and see me around, please say hi!  I'll be doing Q&A this morning after Brian's keynote speech on engagement, doing intro and Q&A for Emmanuel Brown from Nike Jordan Brand, and running a track session this afternoon with BzzAgent's Dave Balter and JD Power/Umbria's Janet Eden-Harris.

[Posted by Peter Kim]

[Posted by Peter Kim]

“Want Loyalty? Get a dog.”

Is customer loyalty a marketing myth? Lester Wunderman thinks so. So does Randy Susan Wagner, CMO of Orbitz.  In her speech yesterday, she spoke about creating deep relationships with consumers, rather than building loyalty.

A few key points that stood out:

• “The enterprise needs to become not just customer driven, but customer insight driven.”
• “The more things (read technology) change, the more they stay the same.”
• "Think like me” is a phrase Randy used to describe discovering a point of connection with your consumer. A human truth. 

A relevant truth for her: people want convenience in travel, not headache.  Basic truths like these allow you to reorganize audiences into more sustainable groups. Orbitz’s new microsite properties are an example of this.

For marketers, microsites are a measurable way of targeting specific customer segments -- sometimes viral, sometimes campaign-driven.  But Randy pointed out individual consumers do not always reside in just one segment.  A 34yr old mother of two from Des Moines might be a family-focused consumer during the day, set on finding a romantic getaway at night, and hooked on Flash mini-games during the weekend. 

Orbitz has created microsites like Orbitz Games, Orbitz Roadwarrior, and Orbitz TLC, that are not seasonal or campaign driven. Instead, they’re branded Web properties (stand-alone, in the case of Orbitz Games) created to become part of customers lives. They develop relationships between brand and consumer.  These new properties are part of how Orbitz is transforming from a technology company into a technology-driven marketing company.  And what is a marketing company, really? A media company.