adapting the pipeline - running the business of emerging marketing disciplines
DESCRIPTION
Prepared for West Virginia University's Integrated Marketing Communications weekend gathering. The ‘Creative Age’ we live in is the ‘wild west’ of business opportunity. New business models are being tested every day, from the widely successful long-tail model of Amazon.com to the ‘boom-and-bust’ Internet businesses that crippled risk-taking shareholders. Some models succeed while others fail. The business of marketing is no exception. Marketing’s traditional challenge is to influence consumers; yet consumers receive over 3,000 marketing messages a day. How do you help your clients cut through the clutter? And, as important, how do you make money doing it? In this session, we’ll take a broad view of how the advent of the Internet is affecting bottom-lines of traditional marketing agencies, for better and for worse. We’ll examine innovative business approaches that offer insight into the future of making money in marketing. Topics include: innovative monetization models, getting paid for performance, establishing key partners in a flat world, developing a unique value proposition and predicting the future of win-win client relationships.TRANSCRIPT
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ADAPTING THE PIPELINE
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Running the Business of Emerging Marketing DisciplinesBrandon Holmes Managing Partner WELD
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• Business Stuff • Pipeline • Value Proposition• Profit Model
What You’re in For…
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What You’re in For…• Industry Stuff
• Disruption• Media • Journalism• Marketing
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The Pipeline• What marketers propose to do and
how we propose to do it is changing…
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The Pipeline
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Value Proposition • An idea that will help customers do
more affordably, effectively, conveniently a job that they've been trying to get done
• It's critical that you figure out how you help them do what they've already been trying to do, but more affordably and effectively
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Value Proposition • Identify target customer, the job to
be done and the offering
• Most common barriers to getting a job done: Wealth / Access / Time / Skills
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Internal UVP• For mid-market organizations and
business units of larger organizations,
• Who need to improve marketing ROI and growth performance in the online environment
• WELD is an Integrated Digital Marketing Company…
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Internal UVP • That plans and executes data-driven,
pay-for-performance Internet marketing programs
• Designed to increase word-of-mouth through effective use of emerging Web technologies
• Unlike companies A, B and C• and via processes X, Y and Z
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Profit Model: How Do You Make Money? • Revenue Model• Cost Structure• Margin Model• Resource velocity
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What’s New?
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Adapting to Disruption • "While many industries will be forced
into radical transformations and upheaval, none will be more affected than the Media, Marketing and Advertising trade”
• Lee, 2006
• http://www.marketing.fm/2006/03/06/the-end-of-the-big-advertising-agency/ The End of the Big Advertising Agency
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Adapting to the Economy • "Marketing is under pressure. In
times of recession and downturn even more then before the various stakeholders require higher degrees of accountability and return on investments made, while budgets are cut…
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Adapting to the Customer• On the other hand,
consumers and customers tune out the marketing communication that is fired at them."
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Disruption in News• "The economy has caused an
immediate problem, but the business model for newspapers, based on circulation and advertising revenue, is broken."
• Senator Ben Cardin (D-MD) • May 25, 2009
• http://www.boston.com/business/articles/2009/03/25/newspapers_could_get_nonprofit_status/
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Disruption in the Ad World • On January 19, 2009, Financial Times
reported that social networks threaten advertising growth: according to the Institute of Practitioners in Advertising (IPA), two-thirds of advertising agencies are not prepared for the industry changes prompted by social networks and new forms of digital media.
• http://www.ft.com/cms/s/0/45e61636-e25c-11dd-b1dd-0000779fd2ac.html?nclick_check=1
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The Result…@adagencylayoffs
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The Result…
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“The Great Satan”
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OMG…WTHAWGD?
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The Systematic Factors • Enablement of individuals to create,
distribute and monetize content. • Connectivity of people, processes
and economic exchanges.• Disruptive technological advances
that accelerate social, political, organizational and economic change.
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The Systemic Factors • Constant change
and discovery of how the new media both creates new models and destroys old ones.
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The Business is Changing…• “We (those of us in the business of
communication) are defining and directing the future of journalism every day…in what we do.
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• “creating new media opportunities; • developing new and immediate
relationships with audiences;• taking news and information directly
to audiences, where they live, work, talk and read;
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• “…understanding that the 4th estate always has the same mandate no matter where its housed, who "owns" it or what execution or delivery route it chooses)
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• “We also direct and define the future of journalism (marketing, communication) by what we don't do (by digging in our heels and refusing to embrace the changes that are core to the philosophy of news and reporting;
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• “by ignoring our audiences or by assuming they should "follow" us rather than our "following" them;
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• “by believing that journalism is based on dogma and articles of creed rather than on trust, credibility and our relationships with readers;
• by refusing to understand that the work of journalism in America has always depended on successful business models of delivery;
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• “…and by confusing the future of journalism with the future of current models of delivery.”
• Chris Martin, VP University Advancement, WVU • Follow Chris on Twitter @ctonk144
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Let’s Look at New Models • News: Global Post • Social Media: Izea and PayPerPost • Virtual World: Millions of US
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Entrepreneurship in IMC? • Philip Balboni recommends that
journalism schools should teach entrepreneurial skills.
• Balboni's work with Columbia journalism students on Global Post was one of many academic-professional partnership ideas mentioned throughout the conference.
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Global Post
A Web Site’s For-Profit Approachto World News
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Global Post • 65 full-time journalist• $1,000/mos for freelancers • Cuts office costs • Journalists receive equity stakes• $199/year subscription (Freemium) • Sell stories to newspapers• Ads
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Value Viral Marketing • To encourage value viral marketing,
companies must tailor the product or marketing message to the target audience, be relevant and appeal to the customer's perception of value.
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Value Viral Marketing • Marketers cannot purposely create
this type of campaign for a product, service or content.
• The product alone must be good enough to create 'chatter'.
• http://wiki.media-culture.org.au/index.php/Viral_Marketing_-_Types_-_Value_Viral_Marketing
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Enter the “Sponsored Conversation”
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Sponsored Conversation • “A sponsored conversation is a social
media marketing technique in which brands provide financial or material compensation to bloggers in exchange for posting social media content about a product, service or website on their blog.”
• www.izea.com
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Sponsored Conversation
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Sponsored Conversation
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Virtual Worlds Marketing Millions of Us • Immersive brand marketing through
virtual worlds, multiplayer online games, and social media.
• Blend of narrative with social and gaming elements creates experiences that take brand engagement to a new level.
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Millions of Us • “We create value
at the intersection of the real and virtual worlds.”
• www.millionsofus.com
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Google Lively – “L.A. Hardhats”
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Lively Closes December, 2008
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Predictions • In his book “The World is Flat”,
Thomas Friedman strongly urges businesses to develop a model and structure that is highly adaptable to change.
• He warns that jobs, industries, and entire careers will be born and die due to the rapid pace of technology.
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Predictions • This will prove to be very true for the
future of Markteting, Advertising and Public Relations.
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The New Agency….• …will constantly embrace change
and technology in order to survive unlike its predecessors whose fates lie with the dinosaurs.
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Our opportunity• Entrant companies beat incumbents• Established company asks, should we
invest to create a new business model
• New companies create what needs to be created
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Even the Pope has an iPod
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Change is here. How are you adapting the pipeline?
Brandon HolmesManaging Partner
WELD @brandoNRG