The Marketing 2.0 Toolkit

The top 10 new tools for measuring up in the new age of Marketing 2.0

DLB Magazine, June 2006
By Steve Shearman, Touchpoint

Recent advances in technology have driven a fundamental power shift in consumer behaviour, largely in favour of the consumer. The shifting sands mean businesses that wish to maintain their competitive edge have had to rethink the way they market. Fundamentally, to keep customers engaged, businesses are realigning their marketing activities so that they are more closely integrated with sales, customer support and other critical business units. This new approach to marketing - we'll call it Marketing 2.0 - is as much an attitude as it is a set of tools and techniques.

To understand Marketing 2.0, it's helpful to compare it to Marketing 1.0. Marketing 1.0 was mainly about companies talking to crowds. There was a focus on lead generation and brand awareness. The acronym was AIDA - Awareness, Interest, Desire, and Action and the basic toolkit included collateral, PR, direct mail, and above-the-line media, such as print, TV, and radio. Marketing operated as a silo - it was our job to hand over leads, and we all recanted the sad maxim that 50% of marketing was wasted, but we just didn't know which half (secretly thinking that 50% might be a bit on the low side).

In contrast, Marketing 2.0 is about crowds talking to crowds. It's fundamentally about PEOPLE. People that don't want to be preached to or sold - they want conversation and community, whatever, whenever and, increasingly, wherever. The people are in control and everyone has a voice and can choose to participate as a publisher and a critic. Many companies and brands have been quick to respond to the power shift, moving from monologues to dialogues and embracing the new moods for engagement, involvement, participation, transparency and community. These emerging drivers have been the genesis of a very much upgraded toolkit, which now includes channels like web, search, blogs, email, mobile and behavioural marketing media (What's this? Google it!). The upshot is that the outputs and outcomes loop has been closed by tools that effectively track the footprints of the relationship. What this means is that finally new performance measures are emerging for marketers, agencies, boards and investors. And most scary for some, media is being auctioned, remunerated on conversion, and marketing expenditures are being tied to revenues and profits.

However, in this brave new world of marketing, it is increasingly difficult for organisations to market effectively to key audiences, because there is a whole new level of complexity - more moving parts to be managed, and reaction is real-time. To be successful, marketers must increasingly adopt tools and media that leverage the new principles and consumer driven changes.

The Top 10 tools to be successful in this brave new world of marketing are:

1. Online Advertising Media
A number of new rich-media presentation technologies and new ad formats have evolved the humble banner ad of the 90s to the level that it now supports several new interactive advertising formats. Streaming video, interactive games and smart targeting, based on technologies that track consumer behaviour, have all helped increase engagement, while maintaining advertising click-through rates. Anyone who has run a large optimised online campaign using ad-serving tools, like those from Facilitate Digital, will know that often online media delivers significantly lower cost per response than most offline media. In addition to ad serving technology, advertising and affiliate networks often provide opportunities for advertisers to pay on performance based models. Examples include paying a cost per lead, a fixed cost per sale, or a percentage of sales paid to the sites that first generated the lead. These models represent a significant opportunity to remove the risk to advertisers while maximising the opportunity for small and large media owners.

2. Google Search Adwords
The ability for marketers to pay for text ads to appear in Google search results and other search engines, when specific keywords are entered, is in itself an extremely valuable marketing tool. But couple this with the new pay-per-click models and the use of auctions and actual advertising performance to set pricing is nothing but revolutionary. With post-click-tracking and tools that allow a brand owner to optimise campaigns based on a cost-per-conversion, marketers finally have the ability to run campaigns where they set the maximum cost-per-sale.

3. Search Engine Optimisation
Dubbed the "Invisible Advertising", SEO involves optimising your website so that it appears on the first page of search results for popular keywords related to your products and services. For anyone selling a product that involves some element of research or consideration during the purchase process, appearing in the top results of an online search can often be the ticket to a profitable business. Many larger marketers feel uncomfortable paying for something where results cannot be guaranteed or quantified in advance. Consequently SEO is often left at the bottom of the 'must do' pile, while investment in higher cost per sale media continues.

4. Permission Email
In the past, marketers have often been heard to say that their existing customer or prospect database is their most valuable marketing asset. Many of the same marketers have now realised that email now offers them a truly cost-effective channel to monetarise these databases and maintain the relationship. With many company permission email databases now reaching into the hundreds of thousands, the humble email is now offering a serious alternative to traditional media for promoting key events such as sales, new product launches and special offers.

5. Mobile
Txting has made the leap from its early applications of Txt2Win and TV voting, to become a mainstream channel for promotions, lead generation, alerts and involving campaigns. With turnkey products like Txt4Info hitting the market, marketers are quickly and cheaply txt enabling their above-the-line advertising in an effort to lift response and increase the engagement with target consumers. And the feedback such products provide allows advertisers to track and compare traditional media performance, highlighting previously unobtainable measurement and optimisation opportunities for traditional media campaigns.

6. Marketing Automation Tools
Well known New Zealand campaigns such as Purina 30-day Challenge, Get Sponsored by Coruba and Smirnoff Half Day Off have shown the power of these tools to manage sophisticated campaigns to create a high level of consumer engagement and participation. Marketing Automation Tools allow the marketer to setup campaigns that automate a series of interactions with consumers across a number of weeks or months, in an effort to create a sales or brand experience opportunity. Although made famous by these large campaigns, they are more commonly used to implement CRM programmes that focus on customer retention and loyalty.

7. Multichannel Lead Generation
As the demand for measurement and accountability continues to rise for marketers, budgets are increasingly moving towards more lead generation and sales promotion campaigns. Although it's early days, tools such as Adwords Pay-per-Click, Pay per Call, Txt4Info and Google Analytics are helping advertisers link online and offline media back to converted leads and sales. Taking this further, marketing automation tools will enable marketers to create automated follow-up and lead management programmes that can extend the initial contact to eventually span the entire length of the sales process.

8. Next Generation Sales Promotions
Technology is also reinventing the humble sales promotion, to the point that brands that persist with traditional promotions, such as clipping and posting barcodes, run the risk of being perceived as old fashioned. Unique codes on packaging have enabled marketers to create a proof of purchase that can be communicated electronically. Web, email and txt have opened the door for simple promotion entry to deliver an involving brand experience. New technologies, such as digital coupons, mobile reward and loyalty programmes, and other collaborative experiences, are set to offer marketers a richer set of opportunities through which to further develop and monetarise these initial relationships.

9. Blogs
In Marketing 1.0 PR was focused on influencing key groups of stakeholders and influencers through defined channels, such as news media. Marketing 2.0 sees a combination of blogs and search, which offer the opportunity for all consumers to participate and opine about your company, products, pricing, and latest promotions. The playing field has been levelled, and companies have no choice but to enter the fray with company and staff blogs. The old adage that marketing is the responsibility of every employee is now an absolute reality.

The ironic part of this development is that consumers and the companies that host these blogs are now monetarising this consumer generated content and attention by selling advertising back to the same companies they are often discussing - through networks such as Google adwords.

10. Viral Marketing and Word-of-Mouth
Although word of mouth marketing has existed from Marketing 0.0 (remember that?), it's only in the last five years that the tools to track and influence this chatter have really become available. It's not uncommon today for large campaigns with involving ideas to capture 40% of new customers from word of mouth and referrals from existing customers. Today tools exist that allow marketers to identify the 5-10% of customers who are strong advocates, and to create programmes that target and reward these people.

So that's my take on Marketing 2.0. Now its time for you to ask yourself - what version are you on? Perhaps it's even time for an upgrade.

Steve Shearman is the founder and managing director of marketing automation company Touchpoint. Touchpoint technology has powered many of New Zealand's most awarded multi-channel marketing campaigns and is the owner of text response service Txt4Info.com. Contact Steve Shearman at steve.shearman@touchpoint.co.nz

DLB Magazine, June 2006
By Steve Shearman, Touchpoint