January 2007
 
E-bulletin Distributed monthly

IN THIS ISSUE ...

Lucas Covers of Philips Consumer Electronics talks customers in “Get to Know”; in “Brand as Business,” Denise Lee Yohn reveals branding strategies that go far beyond advertising and PR; a “Survey” of top marketers gives an inside look at their agency wants and whims; Joe Lichtenberg of Eluma speaks to importance of harnessing consumer power on the Internet in “The Download”; and more.
Editor's Cut  
Get To Know a CMO  
Brand as Business  
Agency Survey  
Digital Divide  
Marketing Metrics  
School's In  
Hello Dubai  
The Download  
Join the Conversation  
EDITOR'S CUT

Now that we’re settling into the new year, the results are in for our Marketing Outlook 2007 survey, which audited marketers’ 2006 accomplishments, as well as their priorities and plans for this year. In all, 250 marketers, many of them CMO Council members, took the survey. The results are interesting to say the least. Here’s a preview here of the top-line results, which will be part of a more detailed report to be released next month.

Top Three Accomplishments in 2006

  1. Restructured and realigned marketing to better support sales and drive demand generation (44 percent)
  2. Implemented new campaigns that significantly advanced the business (28 percent)
  3. Overhauled brand image, visual identity, web site and collaterals to better capture and convey value proposition (26 percent)

Top Three Challenges in 2007

  1. Quantify and measure the value of marketing programs and investments (47 percent)
  2. Improve the efficiency and effectiveness of the marketing organization (41 percent)
  3. Grow customer knowledge, insight and conversations (32 percent)

New Marketing Solutions, Services or Systems to Add in 2007

  1. E-mail campaign management (40.6 percent)
  2. Lead generation, qualification or reactivation (40.6 percent)
  3. Marketing performance measurement dashboard (38.8 percent)
  4. Customer relationship management (35.2 percent)

Anticipated Budgets

While about 21 percent of marketers anticipated a budget increase of 1 to 5 percent from 2006 to 2007, nearly 19 percent expected an increase of 15 percent or greater. Twenty percent expected no change.

And I thought you’d enjoy an open-ended answer to a question about operational priorities for this year:

“2007 is the year to prove that our marketing works. We need to establish the brand, create buzz and awareness, drive demand, and most importantly fill the revenue pipeline. And I need to do it on a shoe-string budget and demonstrate ROI for every dollar spent. Easy. “

So easy! Along with the Marketing Outlook 2007 study, we’re set to release our Define & Align the CMO report. To whet your appetite, read our “Get to Know a CMO” on Lucas Covers of Philips Consumer Electronics. Lucas possesses insight and influence in a number of business areas within Philips, and is on the same page as the CEO to boot! His position is well defined and very much aligned with the strategic goals of the company—just what we’re advocating in the report.

And speaking of marketers in the know, we’ve got a great Advisory Board in place for 2007, representing prominent B2B and B2C organizations, including AT&T, GE, Intel, Kodak, MySpace, Pizza Hut, Motorola, Kroger, and more. To check out the people who will be instrumental in driving the Council’s agenda, go to http://www.cmocouncil.org/advisory_board.

I came across a data point that online ad spend is forecast to reach 20 percent of the total U.S. ad spend in 2007, according to Outsell, with TV, radio and movie ad spending expected to decrease 3.5 percent this year. The Web just keeps chipping away. For more on this as it pertains to your choice of agencies, check out the article “Digital Divide.”

Finally, this will be my last issue Marketing Magnified, as I am leaving the CMO Council for an opportunity in the corporate world. It has been a pleasure to serve all of you, and I wish you nothing but marketing and personal success in the future.

Enjoy the issue and its new-look, courtesy of our expert design team!

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GET TO KNOW A CMO: LUCAS COVERS, SENIOR VICE PRESIDENT AND CMO, PHILLIPS CONSUMER ELECTRONICS

Lucas Covers was appointed CMO of Philips Consumer Electronics in May 2005. Based in Amsterdam, he is responsible for strategy, marketing, intelligence, alliances and new businesses. Covers is leading the transition of Philips from a traditional technology driven enterprise to a market-driven organization. His scope of influence and responsibilities goes well beyond traditional marketing; they include value creation, competitive issues, and management of global strategies across business groups and regions. Covers calls the changeover to a market-driven focus a “journey,” and along that road the customer is key. His extensive product experience (he started at Philips in 1986 as a product designer) puts him front and center with the end user.

We recently spoke to Covers about marketing’s role at Philips in general, his CMO role specifically, and the laser focus on customers.

Marketing Magnified: Describe this change from being a technology focused company to a marketing driven one.

Lucas Covers: In a technology company people have the DNA to build products. They love to build. If we create a concept, within a day we can see a prototype. But now we are not making a judgment on whether we can build it, we are first asking if the product fits the need of the consumer. And in asking that question, there’s so much change in the way we bring concepts to market.”

And how would you say this transition is going?

It’s a journey but it’s rewarding. Because we have been technology focused for so long, there is some resistance. But the moment you start to get proof points of success in the market, it is worth the effort.

You mentioned fitting the needs of consumers. How are you accomplishing that?

First we’re training a lot of people internally to move from providing only what is possible from a technology point of view to becoming end-user centric. For example, we have a very specific course around end-user insight. Almost 3,000 people are trained in the ingredients that are included in marketing, which takes marketing deep within the business units.

We also have an in-flow of new talent—people who are experienced in customer centric activities.

What skills and traits do you look for in new talent?

We look for people who have experience in multiple regions—working around the globe interfacing with different cultures and different types of organizations. We also like to see people with both B2B and B2C experience. And, of course, they need to know the basics of marketing.

How do you grow talent within Philips?

We like to say we don’t believe in growing on one pillar of experience. We try to get people out of marketing and in the field with sales, or in a business unit that is developing and creating products. Then when they come back we feel that they add much more to marketing.

How is the marketing organization structured?

We have around 600 marketers around the globe. And they are mostly in the downstream part of marketing. We have part of the marketing team upstream at our Creation Centers. Those people very much involved in testing prototypes and creating go-to-market plans. It also includes marketing strategy and market intelligence.

I’m very involved in the upstream part—in defining where we want to head, what types of concepts we should develop and what business spaces we should go after. Then those in the downstream bring those propositions to market. That makes the circle full.

Generally, the CMO has traditionally been more related to the downstream side—the media buying and advertising world of marketing. Those things are not irrelevant, but they are only one part of the equation.

How do you measure marketing’s effectiveness?

We’re using a metric that’s been put into play by many companies, the net promoter score. It ties directly to providing good products and solutions to the customer. This metric is embedded around the company, and we review programs and projects on this basis: Are end users happy with what we deliver?

For example, we have Consumer Experience Centers within our Creation Centers. It’s really a living room in the factory, where we have customers come in to play with our products. We ask them to install the product, hang it up on the wall, and hook it up to a DVD recorder— without using the user manual, within 10 minutes. That’s a metric on which we have to deliver. It’s directly tied to our brand promise—Sense and Simplicity.

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BRAND AS BUSINESS: HOW TO IMPROVE BRAND IMPACT

By Denise Lee Yohn

Looking to improve the impact of your brand? Think a change to your logo or a new ad campaign will do the trick?

Companies seeking to maximize the full impact of their brand often turn first to the “usual suspects” – name, logo, advertising, or PR. But these efforts serve only to express the brand. While brand communication is essential to generating brand awareness, it must be based on real-life delivery of brand value. That is, consistently executing a relevant, compelling, and differentiated brand will have far more impact than simply communicating one.

After all, if a brand is more than a name, logo, or catchy slogan (as I hope we can agree it is), then executing your brand is more than marketing and advertising. Strategic brand execution TM is about integrating brand understanding and business decision-making. It’s about creating a brand that represents the bundle of values and attributes that define your product’s value to its customers and the way you do business with all of your stakeholders – and interpreting and reinforcing your brand in everything you do.

Your brand is a promise to be delivered; a compass to be followed.

Getting There
In my work with companies ranging from Frito-Lay to Nautica to Covad, I’ve found translating brand strategy into operational reality is the critical brand challenge facing companies today. Many companies know what they want their brand to stand for but they don’t know how to get there.

Leaders must first look to operationalize the brand – translating brand values and attributes into actions, decisions, and changed behavior throughout the organization. Brand execution happens through:

  • internal brand alignment and integration,
  • optimized brand:customer connections, and
  • brand operational agendas .

Click to enlarge One Common Understanding
All stakeholders must share one common understanding of the brand – they must be engaged with it and their daily decision-making must be aligned with it. The first step to internal brand alignment and integration is a clear articulation of the brand values and attributes. You can’t simply trust your employees’ instincts to “do the right thing,” nor assume all of your managing partners “get it.” A framework such as the Brand Pathway, which connects the company mission to the customer experience, can be used to define and describe what the brand stands for.

Publishing the brand framework in a form and manner that is accessible and digestible by all stakeholders is the next step. Whether a rich, interactive online Web tool or a low-tech workbook-style booklet, your brand guide should engage the head and the heart – and the hands.

Engaging the hands involves the last step of the brand alignment and integration process. Company leaders and department managers should develop instructive tools to facilitate actions and decision-making that are on brand. “Must-make” points for salespeople, a partner program toolbox that helps managers determine which companies to partner with and how, and a new product decision-tree for your R&D team are a few examples of tools that can ensure your people are equipped and empowered to bring the brand to life.

Brand:Customer Connections
Strategic brand execution also calls for consistent and compelling delivery of your brand at every touchpoint with the outside world . In optimizing your brand:customer connections, the maxim “you manage what you measure” applies.

Click to enlargeYou must first identify all the different points of contact through which your Company communicates or delivers the brand. A Brand Wheel can visually depict the full range of your touchpoints (advertising and marketing represent only a fraction) and show the linkages between each team or department that impact them. By placing the brand at the core of the organization, you can show how your people can work together to deliver the brand consistently across all touchpoints.

Then you can audit and evaluate each touchpoint and prioritize those that need to be improved in order to better deliver the brand.

Developing narratives to describe the optimal experience at priority touchpoints is another useful approach. By painting a vivid picture of the brand touchpoint at its very best, you can enroll people in your vision for the ideal brand: customer connection.

Brand Operational Agendas
To facilitate the engagement and alignment of your stakeholders and the optimization of your brand: customer connections, strategic agendas for each operational team or business unit should be developed and implemented.

Brand operational agendas link brand opportunities with the functional groups responsible for implementing them. For example if your desired brand position suggests a change in distribution strategy, agendas for your sales, development, and logistics teams should be engaged. These shouldn’t be lofty, conceptual plans – they should lay out specific actions, target dates and deliverables, and means for measuring progress along the way.

It is important to engage the members of the functional teams in the development of operational agendas. Not only will this improve their understanding of and support for the brand, but also it may prompt the identification of new brand execution opportunities.

Strategic Brand Execution
The recent buzz that brands have enjoyed in the marketplace has led many companies to pursue brand-building strategies. But a brand’s success today lays less in developing a cool logo or launching a creative advertising campaign, and more in operationalizing the brand throughout a business.

When it comes to brand impact, you may find it’s easier said than done. But if it’s “done” – if brand understanding is fully integrated with business decision making – then real brand value is delivered to your customers. And to you.

Denise Lee Yohn is an independent brand resource who partners with clients to grow and leverage their brands. Contact her at mail@deniseleeyohn.com. © 2009 Denise Lee Yohn, Inc.

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MARKETERS WEIGH IN ON AGENCY ISSUES

The following is an executive summary of the 2006 U.S. New Business Report, fielded to 110 key marketing decision makers in Q4 2006. This study was commissioned by Reardon Smith Whittaker.

The sample came from a database of decision makers each with marketing budgets estimated to be in excess of $2M per year. They were largely senior and middle management marketers as shown in the breakdown below.

Executive Summary: Key Findings

  • Only 21 percent of clients use a roster system, suggesting that most clients use other means to learn about the strength and value of agencies in consideration.
  • Among agency specializations, advertising agency appointments figured nearly four times as high as any other agency type, suggesting either that advertising is higher up on a clients’ agenda or the length of agency tenure is extremely short…and shortening.
  • Overall, 48% of clients said their previous agency relationship lasted less than two years.
  • Nearly 1 in 4 agency appointments (23 percent) involved a procurement specialist, so don’t ignore them!
  • Whatever they may have felt in the past, marketers now appear to place some modicum of value on the role of procurement in the selection process.
  • Of the four main reasons given by clients for reviewing, three of these involve issues that are in the power of agencies to control and prevent!
  • Typically, having decided upon the need to review, most clients take 2-3 months before a final appointment is made.
  • When reviewing, 53 percent of clients saw six or more agencies, so if the prospect is aware of your agency, you might have a shot to get on the preliminary review list.
  • Of the factors influencing clients to meet with an agency, a timely approach continues to be highly significant, with 41 percent of client decisions influenced in this way. Among other factors within the control of agencies, it is clear that agency marketing efforts (which can build “un-attributable awareness”) and agency Web sites are also very influential.
  • Clients typically invite three agencies to pitch when there is a full-blown review.
  • One in five clients now incorporate a form of payment by results in their terms of business.
  • Clients generally enjoy the process of looking for a new agency, with 41% of respondents saying they either “look forward to it” or “enjoy it.”
  • Among the “new wave” of growing or emerging marketing communications disciplines experiential marketing is by far the most interesting to clients, followed by internet marketing, then by discipline of buzz or word of mouth marketing

Copyright Reardon Smith Whittaker US, GP 2006 ©

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DIGITAL DIVIDE: CMOS LOOK PAST TRADITIONAL AGENCIES FOR ONLINE NEEDS

With the Internet becoming an increasingly important part of marketing, chief marketing officers are looking outside the traditional advertising agency circle for digital marketing talent. A new survey by marketing consultancy Sapient finds CMOs are less likely to believe one agency can do the job of marketing in today's fragmented media universe.

"Both corporate marketing organizations and agencies are undergoing seismic changes trying to create innovative marketing approaches that deliver real strategic business value," says Gaston Legorburu, Sapient's chief creative officer and head of the Experience Marketing practice. "But innovation doesn't just mean snapping some cool digital programs into a conventional advertising platform. Two of the greatest challenges companies are struggling with are how to measure the effectiveness of the marketing spend and how to operationalize their entire digital strategy."

From Sales and Marketing Management Magazine

Among the results:

52 percent of CMOs surveyed believe that traditional large advertising agencies are ill suited to meet online marketing needs.

49 percent say traditional ad agencies have trouble thinking outside traditional media models of print and TV.

Fewer than 10 percent say they would partner with a large ad agency for online marketing needs.

68 percent say they prefer to work with multiple ad agencies to take advantage of boutique specialization.

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DO MARKETING MEASUREMENTS INDICATE MANAGEMENT PERFORMANCE?

By Nicholas Watkis

“If you can’t measure it, you can’t manage it” said Peter Drucker. This statement applies as much to the Marketing function as it does to every other part of business. However, the statement does not say that “If you can measure it, you can manage it”, and that is certainly true of marketing. Measuring marketing performance does not guarantee good management, but is an indicator of management performance.

Marketing, which generates profit by anticipating and satisfying customer demand, requires considerable investment in money and resources, and is at the heart of every business. It is much more than just the advertising budget, and to measure the return on marketing investment requires a deeper understanding of all the activities which go to satisfying customer demand profitably. If all marketing is investment, why would companies not want to assess the returns on their money? Increasingly Chief Executives and Financial Officers are looking to ensure that measurements of the return on investment are used across the whole business area, including marketing. Marketing managers must now not only deliver a return on the investment but also be seen to do so and be able to prove it.

Marketing is a broad subject, covering every aspect of a business that anticipates and satisfies customer demand profitably. If follows that Marketing encompasses a wide variety of subjects from market research, product planning, selling, advertising and promotion, distribution, business planning and a host of other aspects that are not purely finance or production centred. For the executive charged with managing the marketing function of a business, the diversity of marketing activities, means that the job is a complex one. In many companies, the chief marketing executive may not be a professional marketer, but is a manager responsible for a staff of professional marketers and employees. For the executive responsible for managing the whole of the marketing function, it is often difficult to know where to start.

Marketing, like most business activities, has changed a lot over the past twenty years. Up until the early 1980s, most marketing activities were manual processes. Data bases were based on card indexes, spread sheets were manually created, with calculating machines only becoming available from the mid 1970s. This meant that all marketing activities took a long time in preparation and delivery. Analysis of marketing activities was limited, and the convenient view that marketing was an art not a science, allowed the misconception that market performance could not be measured, to be the generally accepted view. Computerization has now swept most of those preconceptions away. The revolution in the marketing function means that manual activities, which in the past took days or weeks to complete, can often now be done automatically. A sales and profit projection which may have taken hours to produce in the past, may now be repeated, with varying inputs, to produce a variety of scenarios in a matter of minutes. Businesses are now able to measure performance across all marketing activities and to quickly identify business opportunities, threats and trends. As the amount of this information has grown, so has the complexity of managing the many aspects of the marketing function.

The purpose of any commercial business is to make profits for the benefit of its shareholders and employees by satisfying customers. The objective of the chief marketing executive (CME) is to maximize profitable revenue while minimizing costs and the use of assets. Maintaining the relationship of profit, costs and assets used is the marketing management problem.

To achieve this objective, the CME must often manage a team of marketing specialists, and ultimately be responsible for a variety of delegated tasks, including planning, market research, selling, advertising, distribution, and many other customer related activities. However, the most important asset at his or her disposal will be the delegated experienced staff, who carries out the specific activities. To be successful, the CME will require good leadership skills to inspire, motivate, direct and encourage the staff, to which he must delegate responsibility to deliver results. At the same time, the CME must institute the continuous management process of the Marketing Cycle for managing marketing and business information and for the development and execution of necessary actions, including the continual assessment and reassessment of performance.

In Dr James Rieley’s book “Leadership” (Daily Telegraph/ Hodder and Arnold); he points out that a pre-occupation with numbers can blind the manager. After all, it is people who get results. Metrics and measurements provide an excellent guide to the immediate past performance of all the marketing activities, but their future performance is dependent on the staff involved who have to deliver them.

The CME will rightly be judged on the measurements of marketing performance he delivers, but that performance will be dependent on his or her ability to motivate, organize and lead the marketing team to achieve their objectives. Measuring marketing performance is an essential indication of recent past and current performance to identify where resources and assets are used to best effect. Only effective leadership and management can direct and motivate the staff, to maximize marketing performance to achieve the marketing objectives.

Nicholas C. Watkis is with Contract Marketing Service ( www.contractmarketingservice.com), a U.K.-based consultancy specializing in measuring marketing performance and Return on Marketing Investment. © N.C.Watkis, Contract Marketing Service

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SCHOOL'S IN: ONLINE CURRICULUM PROGRAM TRAINS MARKETERS TO EMBRACE MARKETING PERFORMANCE MEASUREMENT

The Chief Marketing Officer (CMO) Council’s 2007 Mastering MPM On-line Certificate Program will kick off its Spring Quarter, Monday, March 5, 2007. The 10-week program concludes Friday, May 11, 2007. Consisting of online participation and independent study, the curriculum includes the completion of an MPM Self-Assessment Audit, prescribed core readings, three topical webcasts, and an MPM independent project report. The Mastering MPM Certificate program provides marketing professionals with intensive Marketing Performance Measurement training and validation of MPM knowledge and skills. Participants are able to provide immediate added value to their organizations by helping to foster an MPM culture, defining an MPM framework, and executing specific MPM tactics that will help improve ROI, marketing efficiency, and effectiveness.

Introduced by the CMO Council in September 2006, the inaugural Mastering MPM Certificate Program attracted marketers from North America, EMEA and the AsiaPac regions and from various industries including retail, technology and engineering. The curriculum and certificate program was initially developed from the CMO Council’s landmark 2004 Measures + Metrics study that identified, among other key findings, that only 13 percent of marketers had formal marketing performance measurement systems in place.

“Marketing organizations are under increasing scrutiny and pressure from the C-suite to implement measurement metrics and better quantify ROI,” said Donovan Neale-May, executive director of the CMO Council. “Marketing Performance Measurement has emerged as a required barometer for proving marketing’s worth, but the expertise needed to implement such systems has proved elusive to many. We’re proud to offer a curriculum that will provide marketers with a better understanding of the factors that influence successful MPM programs, as well as practical hands-on experience.”

The MPM Academic Advisory team, which serves as the external review board for project reports, is updating the groundbreaking Measures + Marketing report with current industry statistics and the CMO Council will reissue the study in the spring of 2007. The CMO Council has assembled a stellar lineup of marketing and academic notables to make up the Advisory team, including senior level marketing executives and professors from the University of Ireland, Cork.

The course quarter fee is $449 per student and includes a complimentary 1-year subscription to the MPM Library (a $250 value) that gives students access to white papers, reports and information on best practices in Marketing Performance Measurement. MarketingNPV, a leading resource of marketing best practices is partnering with the CMO Council on the 2007 Mastering MPM program and will contribute articles, reports and data on MPM best practices to both the MPM Library and course curriculum in 2007. For more program information or to register, go to: http://www.mpmforum.org/register.asp.

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HELLO DUBAI: CMO COUNCIL TO LAUNCH IN MIDDLE EAST AT WORLD CEO FORUM

The World CEO Forum, one of the largest gatherings of key business decision makers in the world, is set for Dubai on March 6-8, and the CMO Council will be there. (www.worldceoforum.net)

The Council’s executive director, Donovan Neale-May, will speak to “The Future of Marketing” on March 6 and then address “Multi-National Marketing Intentions in the Middle East” on March 7.

The United Arab Emirates is considered the gateway to the market of some 3 billion consumers that spans 31 countries in the Middle East, North and South Africa, India and the CIS.

The inaugural event in 2006 connected business leaders from 18 countries, and every indication is this could increase to more than 40 countries this year. The World CEO Forum is offering a special rate to CMO Council members. For more information on the event and to register, go to www.worldceoforum.info.

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THE DOWNLOAD: THE CONTROL PARADOX

WITH WEB 2.0, STAYING IN CONTROL MEANS LETTING GO
By Joe Lichtenberg

Time magazine named YOU the person of the year for 2006. The Association of National Advertisers listed consumer control as the top trend of 2007. Consumer generated information grabbed the spotlight with YouTube, MySpace, Second Life and bloggers taking center stage. In fact, it appears that consumer generated commercials will be the advertising theme during the 2007 Super Bowlfour brands (including the NFL) have already called upon real people to come up with real ads for their products.

Yes, the balance has changed… Consumers have more control… The democratization of the web has turned the marketing world upside down.

"We've learned a paradox that the more in control we are, the more out of touch we are with our customers,” says A.G. Lafley, chief executive at the Procter & Gamble Company at the recent annual conference of the Association of National Advertisers. “We need to learn to begin to let go and embrace trends like commercials created by consumers and online communities built around favorite products.”

To echo Lafley’s thoughts, marketers that don’t embrace consumer generated information and fail to recognize the tremendous power their customers now wield on the internet will be left behind. There are about over 65 million blogs tracked by Technorati (and 175,000 new ones each day). The number of forums on the web is exploding. And, social networking sites are running rampant. In fact, founded just three years ago, MySpace was the second most popular website of 2006 with more than 250 billion page views according to Nielsen’s AdRelevance report.

Search for Wal-Mart on MySpace and your first result is a Wal-Mart built profile that has both good (some real and some obviously fake) postings and bad (real) postings. But search for McDonald's and two of the first four hits are for boycottmcdonalds and endmcdonalds, with no sign of a real McDonalds profile.  I am definitely not suggesting that all brands run out and build a MySpace profile, but that right now, as you’re reading this article, conversations about your brand are happening all over the Internet, whether you like it or not, and whether you participate or not.

Different strokes for different folks

If we haven’t begun already, we all need to start hosting, and participating in these conversations. But before diving in head-first in a rush to implement hot new technologies, it is important to stop and refocus on a basic premise of marketing: which is that any initiative you undertake should have a clear set of business goals. Are you trying to acquire new users? Create a more engaging experience for your current users? Each web 2.0 initiative can bring a different set of benefits to your marketing plan. For instance, submitting your content to rating and tagging sites (like Digg) and social bookmarking sites (like deli.cio.us), and building profiles on social networking sites like MySpace are valuable for casting a wider net and attracting new users. Putting online community, blogs, forums, talkback comments, and the like on your website are great for creating a more engaging experience for users who already frequent your site.

And what about initiatives for your most loyal users? If you’re like most marketers, you’ll agree that loyalty pays. In fact, study after study has shown that loyal customers have a direct effect on the bottom line:

  • An increase in customer loyalty of 1 percent is equivalent to a 10 percent cost reduction (Bain & Co.)
  • The probability of selling something to a new prospect is only about 5-20 percent; the probability of selling something to an existing customer is 60-70 percent (Marketing Metrics)
  • Customer loyalty accounts for 38 percent of margin, 40 percent of revenue growth and 38 percent of shareholder value (Accenture Research)

When it comes to developing and maintaining tighter connections with your most loyal customers, you might consider taking your community building efforts to the desktop, the most valuable piece of marketing real estate you can get.

Extending the brand to the desktop provides a trusted environment for your most loyal customers to interact with each other and with your brand, and delivers benefits to you that go beyond those of traditional website-based online communities. A desktop-based community enables marketers to:

  • Create and maintain an always on connection to the customer: Instead of having to rely on customers visiting your website to participate, a desktop community is always accessible, thereby increasing the likelihood and frequency of use. What’s more, a desktop community provides marketers with a constant, always-on connection through which they can deliver timely and relevant content, information, and alerts.
  • Constantly reinforce the brand: With a desktop community, your brand and your content are constantly displayed on your customers’ computers. For every minute your customers are using their machines, your brand is visible. There is no other online marketing strategy that rivals this level of brand exposure.
  • Reward most loyal customers: A desktop community offers marketers a unique and effective way to reach their most loyal customers (research has shown that the most loyal customers download a desktop application), so savvy marketers will use a desktop application to augment their current offering of loyalty programs to provide special perks such as premium content, special discounts or promotions, or access to informative chats and forums, for example, that are offered only through this channel.
  • Add revenue opportunities: Desktop communities empower brands with a more efficient marketing channel (than email or banner ads, for example) to deliver promotions and messages to a captive audience. What’s more, because customers segment themselves via their involvement within the community, marketers can tailor messages to their specific interests. The result: highly targeted communications, delivered directly to loyal customers, through a highly effective channel.

For example, Traffic.com, a forward thinking online content provider, is now implementing desktop-based online communities for its most loyal users, complementing the many web 2.0 technologies it already provides to its website visitors. The desktop application enables Traffic.com to take its online community to the next level, providing an increasingly interactive, relevant experience to the nearly two million users who use their service for real-time traffic information.

Backcountry.com introduced a desktop application in October, 2006. One component of the application is a desktop alert system that notifies customers when a new deal has been posted on its website. Says president John Bresee, “We have tens of thousands of people downloading it. It paid for itself in the first day.”

2006 was a watershed year in the evolution of the web. As counterintuitive as it seems, the more control you give your users, the more in control you’re likely to be. One way to make sense of the various web 2.0 initiatives at your disposal is to map them to your business drivers: new user acquisition, a stickier experience for existing users, and tighter connections to your most loyal users. Using the latest tools and technologies to provide connectivity, community, and brand presence — directly to their users’ desktops — enables marketers to deliver a superior brand experience for their most loyal, and most valuable, customers.

Joe Lichtenberg is VP of Marketing & Business Development with Eluma, which provides the only brandable desktop application that drives customer loyalty and incremental revenue through the power of communities. For further insights, Joe can be reached directly at 781-376-1924 or joe.lichtenberg@eluma.com.

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