t he future of marketing is the internet of things
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© 2012 IBM Corporation© 2012 IBM Corporation
The Future of MarketingElana AndersonVice President, Enterprise Marketing Management
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© 2012 IBM Corporation© 2012 IBM Corporation
Our world is undergoing a profound change driven by technology
Massive amounts of addressable data
RFID, GPS, intelligent sensors, network data, etc.
Consumer generated data will result in 80 Exabytes by 2014
Affordability, analytics, and automation
Affordably manage, apply advanced and predictive
analytics, and Watson-style guidance to massive amounts of
data
New forms of interaction2.4B people on line
2.1B smartphones in 2015Social media
Businesses that harness these trends have an unprecedented opportunity to know their customer
and interact in a truly informed and personalized way.
Customers are more informed, empowered, demanding of and less patient with the brands they
interact with.
The Result?
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© 2012 IBM Corporation© 2012 IBM Corporation
Marketing’s universe is changing
Customers know more
Customers demand more
Your business expects more
… and so CMOs must re-imagine their profession
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© 2012 IBM Corporation© 2012 IBM Corporation
As we look to the future role of marketing, we must remember the timeless responsibilities of the function.
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© 2012 IBM Corporation© 2012 IBM Corporation
Marketers have always been responsible for knowing the customer.
Marketers have always been responsible for defining what to market, and how to market.
Marketers have always protected the brand promise.
The timeless responsibilities of our marketing profession
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© 2012 IBM Corporation© 2012 IBM Corporation
Today, these fundamental responsibilities provide the foundation for the three imperatives of a new profession.
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© 2012 IBM Corporation© 2012 IBM Corporation
Marketers have always been responsible for knowing the customer.
Marketers have always been responsible for defining what to market, and how to market.
Marketers have always protected the brand promise.
The three imperatives of a new profession
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© 2012 IBM Corporation© 2012 IBM Corporation
Marketers have always been responsible for defining what to market, and how to market.
Marketers have always protected the brand promise.
Understanding each customer as an individual.
The three imperatives of a new profession
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© 2012 IBM Corporation© 2012 IBM Corporation
Creating a system of engagement that maximizes value creation at every touch.
Understanding each customer as an individual.
Marketers have always protected the brand promise.
The three imperatives of a new profession
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© 2012 IBM Corporation© 2012 IBM Corporation
Designing your culture and brand so they are authentically one.
Creating a system of engagement that maximizes value creation at every touch.
Understanding each customer as an individual.
The three imperatives of a new profession
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© 2012 IBM Corporation© 2012 IBM Corporation
Marketing organizations in outperforming companies embrace these imperatives
Revenue Growth / Gross Profit Growth3-year CAGR, 2008-2011
Engage:optimize
experienceacross all channels
Analyze: sophisticated and cross company marketing analysis
Low High
High
Low7% / 6%
10 % / 12% Outperformers
Source: IBM Center for Applied Insights: analysis of 100 public companies and their responses to the 2012 IBM Global Marketing Survey.
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© 2012 IBM Corporation© 2012 IBM Corporation
Imperative 1: Understanding each customeras an individual
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© 2012 IBM Corporation© 2012 IBM Corporation
Let’s start with a story…
Have you ever felt that a company is grouping you with a population thatyou don't relate to?
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© 2012 IBM Corporation© 2012 IBM Corporation
Meet my mom, Iris
72 years old
Loving grandmother of two
Professor of Marine Science, William & Mary
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© 2012 IBM Corporation© 2012 IBM Corporation
Our customers are demanding that we know them as more than a transaction, more than a demographic, more than a segment.
What do they hunger for?
What is the deeper need we are trying to address?
What do they want that they can’t quite express yet?
What is not just their next best action, but their next possible aspiration?
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© 2012 IBM Corporation© 2012 IBM Corporation
The best brands are very strategic about which touchpoints get instrumented and what data about individuals emerges as a result.
What is your instrumentation strategy to learn more about customers as individuals?16
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© 2012 IBM Corporation© 2012 IBM Corporation
Transactions
Orders
Paymenthistory
Usage history
Purchasestage
Email / Chat
Call center notes
Web click-streamsIn-person
dialogs
Opinions
Preferences
Desires
Needs
Characteristics
Demo-graphics
Attributes
Demographicdata
Transactiondata
Interactiondata
The great leap is into all the data that lies outside our enterprise—and into the new insights that data offers.
What is your strategy for attracting data from beyond our borders?
Behavioraldata
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© 2012 IBM Corporation© 2012 IBM Corporation
How predictive must your insights about customers be?
Transactiondata
Interactiondata
Descriptive analyticsPredictive analyticsPrescriptive analytics
Email / Chat
Call center notes
Web click-streamsIn-person
dialogs
Opinions
Prefer-ences
Desires
Needs
Character-istics
Demo-graphics
AttributesArmed with new analytics, we are able to enter the world of predicting the next best offer, action or need.
Transactions
Orders
Paymenthistory
Usage history
Purchasestage
Demographicdata
Behavioraldata
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© 2012 IBM Corporation© 2012 IBM Corporation
Imperative 2: Creating a system of engagement that maximizes value creation at every touch
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© 2012 IBM Corporation© 2012 IBM Corporation
How our customers behave today
Online
Mobile
Call center
Social
Kiosk, ATM
Point of sale
Postal mail
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© 2012 IBM Corporation© 2012 IBM Corporation
Marketer
One person behind all the
channels, guiding the dialogue
and relationship
How our customers expect us to behave
Online
Mobile
Call center
Social
Kiosk, ATM
Point of sale
Postal mail
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© 2012 IBM Corporation© 2012 IBM Corporation
In reality, here’s what our customers experience
Online
Mobile
Call center
Social
Kiosk, ATM
Point of sale
Postal mail
agenda
strategy
data
tech
agenda
strategy
data
tech
agenda
strategy
data
tech
agenda
strategy
data
tech
agenda
strategy
data
tech
agenda
strategy
data
tech
agenda
strategy
data
tech
agenda
strategy
data
tech
Marketing
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© 2012 IBM Corporation© 2012 IBM Corporation
Leading Marketers are working to create systems of engagement that…
Satisfy and delight customers because they deliver experiences:–that are personalized and relevant–which feel like a service
Facilitate “hyper personalization” across millions of customers and interactions
Enable constant testing and adjustment of tactics
When this is done well, your employees naturally deliver on your brand promise, your customers become your advocates,
and they cascade the positive effect
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© 2012 IBM Corporation© 2012 IBM Corporation
1:1 Marketing Continuous Customer Engagement
Marketing All customer interactions
Controlled and planned (campaign focused) Agile (customer focused)
Loyalty programs Inferred loyalty
Opportunistic and reactive Sensory, real-time, and location aware
Micro segment personalization Contextual hyper-personalization
Owned (addressable) media Paid, earned, and owned media
Business concept shift from “1:1 Marketing” to “Continuous Customer Engagement”
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© 2012 IBM Corporation© 2012 IBM Corporation
“Continuous Customer Engagement” means systematically interpreting and evolving a comprehensive understanding of an individual in order to engage that individual in a productive manner in any brand interaction
Is my product delivering value to the customer?
Does the customer need help now?
Is the customer in market now?
What is the right product for this customer?
How does the customer perceive my brand?
Does the customer have enough information to make a
decision?
Will the customer act if we make an offer now?
What price should I charge?
Is the customer using my product effectively?
Is the customer willing to advocate for my brand?
What is the potential of this customer?
How should I differentiate my treatment of this brand advocate?
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© 2012 IBM Corporation
Systems of engagement matter because when you get it right every interaction becomes valuable.
Marketing becomes so natural that it’s experienced as a service.
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© 2012 IBM Corporation© 2012 IBM Corporation27
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© 2012 IBM Corporation
Imperative 3: Designing your culture and brand so they are authentically one
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© 2012 IBM Corporation
In the past, when someone had a bad experience with a company, only the individual would experience it.
Now, the world can know instantly.
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© 2012 IBM Corporation
THE TWEET THAT KILLED MY COMPANY
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© 2012 IBM Corporation
Brand
Marketers have always protected the brand promise.
Now, we have to pay equal attention to every employee and to everyone in our supply and distribution network—each one is now a touchpoint.
Customers
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© 2012 IBM Corporation
In a world of total transparency, that task is on a much different scale.
We must build authentically great companies and, therefore, great brands. And that starts with culture.
Employees Customers
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© 2012 IBM Corporation
An internal memo is leaked to the media
An influential blogger has a bad customer experience
Advocacy groups reveal an unethical practice in the supply chain
Every day, millions of actions driven by our culture influence what others think of our brand.
Now, we must become skilled at understanding how our institution is being discussed in the public realm.
Marketing has an opportunity to be an integrating function and also a force for transformation. 33
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© 2012 IBM Corporation© 2012 IBM Corporation
Designing your culture and brand so they are authentically one.
Creating a system of engagement that maximizes value creation at every touch.
Understanding each customer as an individual.
The three imperatives of a new profession
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© 2012 IBM Corporation
The Future practice of Marketing – the CMO + CIO Partnership
60% growthin marketing analytics spend over the next three years
$1.5 trillionspent on marketing in 2011
$148 billionin IT-related spend influenced by CMOs
The C-Suite will demand that the CMO produce both a strategy and a plan for how market-driven data will significantly contribute to corporate objectives. – 2013 IDC CMO Predictions
New Marketing Machine Has Powerful Engine, But Bad Drivers, Few Mechanics
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© 2012 IBM Corporation© 2012 IBM Corporation
Here’s to the future.
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© 2012 IBM Corporation
Elana AndersonVice PresidentIBM Enterprise Marketing [email protected]
@elanaERA781-472-6800
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