Presentation given at the Inspire 2009 conference in Bucharest. Originally intended to be titled Â´What if there was no TVÂ´, during the preparation we noticed several trends that led us to change the title to Ãdvertising is DeadÂ´. Every new technology has a shorter curve from introduction to irritation. ItÂ´s time for a new approach, which we call the Attraction Model.
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What if there were no more TV? FUTURELAB
Outline speech Bucharest Need kickass opener Advertising is Dead FUTURELAB
We are Futurelab FUTURELAB
WE ARE FUTURELAB We create new profit opportunities for our customers. Our innovations and methods allow: Marketers to become more effective & engaging. Innovators to identify the next opportunity or niche. CEO„s to connect their business to the customer. • • • In the process, we challenge every barrier to business success. We dislike writing reports, billable hours or elaborate processes. Instead, we prefer to "get on" with making money for your business. FUTURELAB
Futurelab Structure Priviliged Relationships Athens – Barcelona - Brussels – (Bucharest ) – Johannesburg – Hamburg – Moscow – Kiev - Munich - Shanghai A flexible boutique: 2 partners – 3 support staff – 9 associates – 28 specialists/contributors
Last Year 76% of consumers don‟t believe that companies tell the truth in advertisements Yankelowich,2006
Last Year “You can‟t bore people into buying your product – you can only interest them”
The Consumer is Tuning Out In 1965, 80% of 18-49 year-olds in the US could be reached with three 60-second TV spots. In 2002, it required 117 prime-time commercials to do the same.” (Jim Stengel, Global Marketing Officer, P&G) • A US hour of prime time TV carried 21 minutes of advertising, Late Night network shows like Leno or Letterman carry 31:27 (TNS Media Intelligence, Q1 2006) • Big Six study (US): People with DVR‟s watch 12% more TV, yet 90% of them adskip (Germany : 88.2%) • 78.2% of Germans are irritated by advertising, only 24% actually still watches it (GfK Marktforschung) • 85% of Chinese stop watching TV during commercial breaks. More than half change the channel, while the rest do housework, eat, chat or use the bathroom. (McKinsey & Co.) • FUTURELAB
Last Year “Today's marketing model is broken. We're applying antiquated thinking and work systems to a new world of possibilities." Jim Stengel, Global Marketing Officer P&G
Last Year Advertising Myths 1. Frequency is mostly not a driver for action 2. There is no golden rule about OTS
Last Year • 54% of US consumers avoids products & services which “overwhelm” with advertising (Yankelovich Partners)
Last Year Advertising is a tax you pay for unremarkable thinking Robert Stephens, CEO, the Geek Squad
Total Transparency • With total transparency, how can there be advertising? • Shotcodes in stores in Japan, telling you where to go to get the product cheaper • A fucked company example
Most influential information sources in purchasing electronic goods? (TOP 3) Magazines 11,7% Source % 49 In-store Sales Associate 36 In-store demonstration CMO Council‟s Retail Fluency Report, 2005 33 Word-of-mouth from family & friends Newspaper Coupons 25 Television 37,8% Internet 21 News- papers 25,9% Product/Company Information 16 Retailer information 14 Radio 8% Internet 9,7% Other 14 Magazines 4 TV 4 Share of total adspend by medium (global) % 2008 forecast (March 2008) Radio 3 What are we focusing on? FUTURELAB
Now… People who live near train lines find ways to adjust to the noise ... Consumers have begun to treat encroaching advertising just like those trains.
Banner blindness 1998!
“Online video ads are quickly becoming the medium of choice to drive both brand awareness and sales.” (2007) Online tactics in terms of ROI (2005-2007) 57% SEO 45% 33% 44% Behavioral targeting 34% 36% 42% Email marketing-house list 47% 47% “With young adults now spending on average six hours a week gaming, advertisers should be excited at how well their messages were embraced and the brands positively perceived” (2008) 34% Paid search ads 49% 52% 21% Contextual targeting 29% 31% 10% Banner ads 12% 14% 7% Rich media ads 28% 38% 0% Pop-ups/pop-unders 15% 22% 67% of marketers report they will increase their social media advertising budget in 2009 23% Text-link ads 0% 0% 0% 10% 20% 30% 40% 50% 60% 2007 2006 2005
• Advertising is dead – long live marketing Lets keep the patient alive a little longer
Procter & Gamble is placing radio- frequency identification tags on products at a Metro Extra retail store in Germany so that when a customer pulls the product off the shelf, a digital screen at eye level changes its message At least be the first!
62% % of marketers advised by agencies to advertise in games/virtual worlds 87% % asked to start/increase viral marketing spend on social networks 93% % told by agencies to begin/increase viral video spend Marketing Sherpa Ad:tech survey Lemmings?
The Advertising Technique Hype Cycle Isnt there a bit much? Hey, actually this is cool Hmm – what‟s this? Naah, cant measure it Sooo 5 minutes ago
FUTURELAB The Attraction Model
Attention Economy Reputation Economy
Relevance Engagement Reputation Reputation x Relevance x Engagement = $$$
Reputation Relevance Engagement FUTURELAB The Attraction Model
Reputation Experience Listening Customers
perception 80% of CEO‟s believe their brand provides a superior customer experience 8 % of their customers agree (Bain & Company) FUTURELAB
Online Reputation Romania FUTURELAB
The online reputation is just the tip of the iceberg But it can crash your boat Source: Forrester Technographics® - 2008 FUTURELAB
So Listen! Because if you don‟t listen...
“With regards to the recent Motrin advertisement, we have heard you. On behalf of McNeil Consumer Healthcare and all of us who work on the Motrin Brand, please accept our sincere apology. We have heard your concerns about the ad that was featured on our website. We are parents ourselves and we take feedback from moms very seriously. We are in the process of removing this ad from all media. It will, unfortunately, take a bit of time to remove it from our magazine advertising, as it is on newsstands and in distribution. Thank you for your feedback. It‟s very important to us.” Results 1 - 10 of about 11,600 from twitter.com for motrin. “hell hath no fury like a mommyblogger scorned”
Reputation Relevance Engagement FUTURELAB The Attraction Model
Relevance Insight Communication Commerce
INSIGHT Understand what truly drives your customers FUTURELAB
• Podcast and map downloaded Commercial – yet relevant
FREE TIX TO GREAT ADVENTURE Heard a rumor you can get 2 free tix to opening day weekend at Great Adventure amusement park 45000 tickets gone in 5 hours