Marketers Should Cut Ad Budgets To Thrive In The Age Of The Customer

Shar VanBoskirk

At least once a week I get a client inquiry wondering what is "the next big thing in interactive marketing," seeking to identify what will out-tweet Twitter or out Goog Google.  Well, in his new report, Competitive Strategy In The Age Of The Customer, my colleague Josh Bernoff articulates what is next for all businesses: A disruptive shift, where the power of customers means that firms must focus on the customer now more than any other strategic imperative.  In fact, the only source of competitive advantage is the one that can survive technology-fueled disruption — an obsession with understanding, delighting, connecting with, and serving customers. In this age, companies that thrive, like Best Buy, IBM, and Amazon, are those that tilt their budgets toward customer knowledge and relationships.

See Josh's post Welcome To The Age Of The Customer: Invest Accordingly for detail on how the Age of the Customer disrupts established competitive strategy.

The zinger in this report for interactive marketers is to: Prioritize word of mouth over mouthing off. Cut your ad budget by at least 10%, and spend the money on connections that have a multiplier effect like social, devices, and content. Ads are far more effective when customers are primed to believe them.

This means that interactive marketing of the future is really focused on interactivity -- not just on pushing out marketing messages through digital channels.  Three ways to get started creating more interactive marketing relationships:

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The Art Of Listening

Kim Celestre

"It is the province of knowledge to speak, and it is the privilege of wisdom to listen" - Oliver Wendell Holmes

I had the privilege of wisdom to listen to many individuals from various B2B and B2C companies last week at the Forrester IT Forum in Las Vegas. One of my favorite aspects of my new analyst job here at Forrester is to meet with tech marketers and hear about the creative ways many of them are using social media to deliver customer value. The individuals I had the pleasure to meet at IT Forum last week certainly did not disappoint, and these discussions were the highlights of my time spent in lovely downtown Las Vegas (insert sarcastic tone here for I am not a big fan of Las Vegas).   

A few key takeaways I had from IT Forum were the following: 1) The lines that once divided B2C and B2B are beginning to blur; 2) Companies are looking for new and improved ways to obtain deeper, more meaningful engagements with customers; and 3) Social media continues to be an area of focus for many companies, albeit many are looking for more effective B2B social media channels, i.e., in addition to Facebook and Twitter.

That said, some of the research I will be conducting in the upcoming months will touch upon each of these topics. I would love to hear your thoughts on your B2B social media strategies! I am here to listen, after all ;-)

Mobile Is Bridging The Digital And Physical Worlds: It Is Time To Invent New Product And Services

Thomas Husson

Google’s product strategists just announced the launch of Google Wallet — an NFC-based mobile payment solution. As my colleague Charlie Golvin pointed out, this is another early salvo in what will be a long and hard-fought battle to change consumers’ payment behavior and, as a potential result, the makeup of the payments landscape.

We have covered this issue in more detail in a new Forrester report “Google Wallet Is Not About Mobile Payments.” Clients can access the report here.

Given its core search business and ad-based revenue model, why would the company make that investment? Because Google’s product strategists’ focus is not on the payment itself; it’s on all of the other elements that comprise a commerce experience and the data that characterizes those elements.

Indeed, appending real-world purchase information to its treasure trove of online behavioral data will vastly increase the value of customers’ profiles and increase the rates Google can charge its advertisers. It will be a way for Google to increase its local presence. NFC is too often equated simply with payments, but Google understands that NFC tags have broad application (working like Quick Response [QR] and other 2D barcodes do today). Google can help retailers use NFC tags for in-store promotions and check-ins, augmenting the understanding of customer behavior for ad targeting.

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Guest Post: James McDavid On Mojitos And Minimal Techno At 35,000 Feet

Nate Elliott

Our London-based Interactive Marketing Research Associate James McDavid chimes in with this great tale of how listening to and embracing your fans in social media can create powerful word-of-mouth marketing:

As every dance music aficionado knows, Miami is the place to be every March as it hosts the Winter Music Conference (WMC), an event that brings together leading lights from the industry to party, share records, and make fun of Paris Hilton. So when Dutch airline KLM announced they'd be launching a new route between Amsterdam and Miami at the end of March 2011, a couple of Dutch DJs tweeted KLM to see if the airline could move the flight forward a week to coincide with the WMC. The DJs claimed that they could fill a flight from Amsterdam to Miami solely with revelers and ravers. KLM, seeing a great opportunity to show off their social savvy, offered the DJs a challenge — if they could get 150 people to register in seven days, then KLM would move the inaugural flight forward — and, as a bonus, let the DJs spin some records in the cabin.

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Announcing The 3rd Annual Forrester B2B Groundswell Awards

Kim Celestre

[Co-authored by Zachary Reiss-Davis]

Welcome to the kick-off for the third annual Forrester B2B Groundswell Awards! We’re excited to again read all of your great submissions and examples of innovation in B2B social media marketing. 

Josh Bernoff, one of the original authors of Groundswell, already wrote a great blog post highlighting the history of the awards that I encourage you to go read. 

For the past two years, we highlighted the B2B winners in:

Best practice research reports . . .

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From Social Media Marketer To Social Media Analyst...

Kim Celestre

I am absolutely thrilled to publish my very first blog as a Senior Analyst here at Forrester and am looking forward to providing you with a lot of exciting research and thought-provoking insights on what continues to be a hot topic in the technology industry: Social Media in B2B. As many of you know, social media is evolving at a very fast pace, and one of my goals is to keep you posted on the latest trends we are seeing and how you, the tech marketer, can utilize these insights to create effective social strategies for engaging with your customers. 

How did I wind up here at Forrester? Well, prior to joining the talented TI Tech Marketing team in April, I spent 14 years at Sun Microsystems, working in various senior marketing roles. I was fortunate enough to lead some pretty groundbreaking campaigns that utilized social media and other emerging marketing tactics. These projects ranged from executing basic marketing strategies using blogs and YouTube to very complex, multi-faceted social media campaigns to drive new product adoption for Sun's software and Java product groups. Lots of fantastic stuff that is worthy of a separate blog post!

After Sun was acquired, I spent the past year at Oracle as a Global Campaigns Manager responsible for Java, cloud computing and enterprise architecture initiatives, where social media was also a big area of focus for demand generation activities. A few months ago, I was presented with an amazing opportunity to join the Forrester team, and, to make a long story short, I have now hit the ground running with a very rigorous B2B social media research agenda and a speaking engagement at next week's Forrester IT Forum in Las Vegas. 

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CORE Lessons From Best Buy, ING And IBM

Shar VanBoskirk

Last week I joined Matt Smith, VP of Marketing Services from Best Buy, Kim Verhaaf, director of Customer Intelligence at ING, and Matt Preschern, VP of Demand Programs for IBM, for a keynote panel: "Marketing Innovation in Action: How Being Adaptive Can Help You Innovate," at Unica's Marketing Innovation Summit.  To structure the panel, I introduced Forrester's CORE framework. If you're not yet familiar with CORE, its our mission that interactive marketers should adopt to help their firms adapt to the next digital decade. See a summary of the topic here or our research on The Future Of Interactive Marketing for a deep dive. 

Smith, Verhaaf and Preschern talked about the efforts they have underway to help their firms customize marketing experiences, optimize decisions and processes, respond to changing market conditions and empower employees and customers to advocate on your behalf. They raised some great points for interactive marketers to consider as they undertake CORE:

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Why The “Web Versus Application” Debate Is Irrelevant

Thomas Husson

Rarely a mobile conference goes by without this debate popping up: Should you build a mobile website or an application? I don’t think it really matters; in fact, I’d say it is irrelevant. This is just one of many topics where technology leads marketing by the nose— as is often the case in the mobile industry! Product strategists often forget to ask themselves the right questions: which product and services, for which audiences, at what cost, and when?

Consumer product strategists designing product experiences for mobile phones and smartphones must decide on their development priorities across the mobile Web and apps. While some believe this is a fundamental “either/or” choice, current consumer behavior suggests that consumers are using both. More than half of European (and 60% of US) consumers who download apps at least monthly also access the Internet via their mobile phones at least daily. In short, heavy app users are also heavy mobile Web users. The more frequently consumers access the Internet via their mobile phones, the more likely they are to download apps at least monthly. More than 10 billion apps have been downloaded cumulatively since the launch of the Apple App Store — the majority of them via iPhones. But this doesn’t stop iPhone owners from being the most frequent mobile Internet users: 72% of European iPhone owners (and 63% of US iPhone owners) access the mobile Internet on a daily basis.

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What Email Marketers Can Do To Protect Themselves From Email Fraud

Shar VanBoskirk

Epsilon's Symposium addressed email fraud head on, since its data breach accessed email data. Quinn Jalli, Epsilon's VP of Deliverability and ISP Relations, recommends that managing email fraud is not something to leave just to your email service provider. The wakeup call from this data breach: Brands must partner with email vendors and ISPs to protect their email send addresses, email brand assets, and in educating recipients about data usage and email fraud.  Specifically:

  • Show ISPs your legitimate emails.  Historically, marketers and ISPs haven't had much of a relationship because they were working toward different goals. Marketers want to get their emails into user inboxes, while ISPs want to manage email data volumes by blocking as many messages as possible. Well, phished emails — copies of your real thing — can be so good that neither consumers nor ISPs can tell real from fraud.  Preempt this by showing ISPs the identifying characteristics of the emails that you create. And of course any examples you have of phished messages if you have suffered this. Your email service provider can facilitate this ISP connection.
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Epsilon's Data Breach Raises Awareness Of Cyber Crime

Shar VanBoskirk

By now, you've all heard about Epsilon's April 1 data breach — an unauthorized party accessed a subset of Epsilon's email clients' data. My colleague Dave Frankland outlines the circumstances of the incident and its implications on Customer Intelligence and data security in his blog post immediately following the incident.

I attended Epsilon's Customer Symposium in Naples, Fla., last week, and I wanted to pipe in with some commentary based on what was addressed directly by Epsilon at the event.

Marketers: The way I would look at this is "if a data breach can happen to Epsilon — a firm which specializes in data and data management — it can definitely happen to me." We learned from Bryan Sartin, director of investigative services, Verizon Business Security Solutions, and Mick Walsh, supervisor, Miami Electronic Crime Task Force, US Secret Service, that electronic crime is a huge and growing business, due in part to the ease of access to consumer information online and the ease of access to the data black market through online search engines. Three-quarters of cases of electronic crimes executed through malware come from data disclosed through Facebook.

Note that most cyber crimes:

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