Practical Guide to Digital Marketing

From The Yaffe Center

Revision as of 17:37, 12 March 2011

Acknowledgements

Content on this page will be adapted from the work of Aarti Gopal

Introduction

“Brand is not owned by the people who manufacture it, it is owned by the people who think about it”

The adoption of various digital tools has led to a seismic shift in the methods of marketing. Although the Internet has presented marketers with many new tools for reaching consumers, it has not replaced the overall objectives of marketing and advertising: to generate sales through influence and cultivate brand loyalty. The Internet has, however, caused a change in the way consumers make purchasing decisions, thus requiring marketers to rethink the way they approach marketing their brands. No longer able to push messages onto consumers, brands and marketers are now challenged to remain relevant and engage with consumers in a two-way conversation. Consumers now drive their marketing experience by pulling information they find relevant and filtering those messages pushed at them. Increasingly, consumers want to connect with brands on a personal level. Consumers are quickly becoming de-facto collaborators in brand building and product development as transparence between marketers and consumers increases through deeper engagement between the two parties. Additionally, consumers have become channel indifferent. They choose how and when they want to interact with a brand.

The reasons for digital marketing are many. Not only has modern consumer behavior come to make it a necessity, but digital marketing offers brand managers the ability to gain stronger consumer insights through data on actual consumer behavior, relevant and accurate information on cost effective methods for broad reach, and the ability to create highly targeted/individual marketing messages, which in turn lead to more effective campaigns.

This paper will address the changing landscape and benefits of digital marketing, assess how consumer trends in decision-making and their role in the marketing process impact campaign strategies, and finally propose a framework for approaching digital marketing plans.

Benefits of Digital Marketing

“I’ve got a lot of passion for digital. It really is such an incredible way to connect with consumers and really have much deeper ongoing relationship with them…” ~ Marc Pritchard, P&G Global CMO

The ease of Internet adoption was fueled by the convenience it afforded users. From email to paying bills to quickly disseminating breaking news, the provides consumers with more efficient ways to complete everyday tasks. The same relationship can be applied to marketing. Digital marketing does not replace traditional marketing; rather it is an essential complement that has driven changes in the approach marketers take to promote products/brands given emerging consumer trends. Before delving into these changes, an exploration of what digital marketing is, as well as its strategic place within marketing plans are needed. Strategic Reasons for Utilizing and Investing in Digital Marketing Initiatives

There are many strategic reasons for investing in digital marketing initiatives. First and foremost, changes in the way consumers are influenced have made digital marketing a strategic necessity. Second, digital marketing offers companies the ability to gain superior consumer insights through data gathered on actual, observed consumer behavior rather than on consumer reported behaviors. This in turn allows marketers to create tailored messages for individual consumers, while also offering companies the opportunity to adjust products based on observed needs. Additionally, marketers can make real-time decisions and changes to campaign based on consumer feedback and performance results. Finally, digital marketing also presents a cost effective method to reach the broadest audience.

Changes in the way consumers are influenced can be directly attributed to the Internet, enabling a significant amount of information sharing. Today’s consumers are in the driver’s seat of the marketing experience. While consumers were once regarded as recipients of a marketing message, consumers now directly interact with brands and companies in a dialogue. This interaction allows deeper insights into actual consumer behavior (instead of what consumers say they do), as well as a method for marketers to gain immediate insight into consumer needs, wants and opinions. Given the trend of consumers wanting authentic relationships with brands, digital marketing offers tools that allow marketers to cost effectively connect their brands with individual consumers.

To understand the power of this transformation, it is imperative to first understand the pre-Internet relationship between consumers and marketers. Historically, pushed messages to targeted consumer groups. Examples of Push Marketing include 30-second TV spots, radio ads, billboards, and print ads, all strategically placed in various media outlets. The messages were generally formed by the marketers based on self-reported consumer preferences, as well as available demographic information. Upon receiving these messages, consumers would decide whether there was sufficient information to make a purchase decision. Since the messages were well-crafted statements conveyed through television, print, or radio advertisements, consumers would seek additional information if they considered the marketing message biased, after all these were generally well crafted company-sponsored statements conveyed through Television, print, or radio advertisements. Consumers would look to experts or authority figures in their network, including not only friends and family, but also ratings by publications like Consumer Reports. In this ecosystem, the influencers were limited to mostly the company messages and immediate networks.

In today’s pull environment of digital marketing, not only do consumers have access to the traditional push marketing ecosystem, but also to an endless number of online information hubs. Consumers are able to seek out information, broaden their consideration set (the product options available to them), and prioritize which sources are most relevant and influential to their decision (which includes push marketing messages). Consumers are no longer passive recipients, but are now active members of the information gathering and dissemination process. Increasingly, marketing messages from a company are just one input to a 24-hours, 7-days a week online conversation that occurs through various global digital forums, social networking sites, Internet videos and posts, mobile phone messages, etc. Not only are consumers receiving messages from marketers, they are also voicing and sharing their thoughts and opinions with marketers and other consumers. Consumers are now media producers, researchers, content creators, advocates, promoters and distributors. In this ecosystem, the influencers include the company messages and immediate networks, but also encompass any other consumer who decided to become a media producer or advocate him or herself. The traditional role played by the company and family and friends is still relevant, but their message has been diluted and others now fill this ‘influencer’ role as well.

Additionally, the ease and cost effectiveness of digital marketing has led to a deluge of new product launches and heightened level of marketing messages. Consumers have consequently become adept at ignoring or tuning-out marketing messages, as well as often multi-tasking between various communication tools that reduce his or her attention to marketing messages. Imagine a consumer watching television, surfing the Internet, and chatting with a friend on his or her mobile phone. In this environment, marketers are constantly challenged to break through the clutter to gain consumer attention.

Gaining Stronger Consumer Insights based on Observed Behavior

In a study conducted by Booz & Co., 80% of marketers surveyed indicated that consumer insights (pieces of information that provide marketers with data regarding consumer preferences, behaviors, demographics, etc. that they can use to better target a segment) are more important now than they were five years ago. Digital marketing enables marketers to easily listen and observe consumers: simply put, digital platforms are everywhere consumers are, from ballparks, to mobile phones, to coffee shops and gyms. This allows marketers to develop new insights into their consumers’ needs, not only for the immediate product experience, but also for how that product is or can be utilized as a component of consumers’ lives. In the past, consumer insights were derived from self-reported needs and preferences. With digital tools, marketers are now able to balance those self-reported insights against how consumers actually behave. These behavioral insights are derived from observing simple tools such as search queries, pages viewed, and time spent in different media mix vehicles. More sophisticated companies are able to glean in-depth consumer insights from observing social networking sites, reading blogs that consumers find relevant, and interacting directly with the consumer through online product communities. Consumers’ observed behaviors of online, along with traditional product usage, demographics, and psychographics information, give a company more robust information regarding their consumers. The increased transparency of consumer needs and behavior is invaluable because it improves a company’s ability to create relevant content and messaging, as well as strengthens the company’s placement, timing and context of advertisements.

Ability to Tailor Messaging and Advertising Campaigns, Instantly

From the beginning, the Internet and digital marketing have presented a way for marketers to experiment over and again, constantly refining their messages to be more effective based on response. Click-thru rates, key word searches, video downloads, pages viewed, and queries are examples of how marketers can instantly measure the effectiveness of digital marketing tools. These metrics indicate how consumers are using various digital tools to learn more or interact with products and/or services. Given the usability and availability of real-time data, marketers are able to instantly adjust marketing campaign strategies to maximize returns. For example, Dove’s Real Beauty campaign included a video depicting the transition of an ordinary woman into a supermodel on a billboard. The video was originally meant as an internal tool, but given consumers’ reactions to other Real Beauty campaign material, Dove decided to post the video on YouTube. The reaction from consumers to the video was swift and immediate. Although it seems fairly easy to post a video to YouTube.com, prior to digital marketing, it would have taken substantial resources to purchase media time (TV) and would have involved a significant time lag (media purchases are on average at least one month in advance). With digital marketing tools, Dove was able to immediately release the video after the decision was made to do so. In addition, digital marketing tools allow marketers to address concerns, misrepresentations, or in extreme cases, when warranted, to remove messages or content that elicit a negative consumer response.

On a more individual consumer level, digital marketing provides companies with methods to communicate specific messages and product benefits to different consumer types. Marketers can send direct communication through email and mobile to particular users that are interested in certain benefits of their product. They are also able to utilize these digital mechanisms to incent brand loyalty or retention. For example, if a consumer is interested in purchasing a flight from Los Angeles to New York City and uses Priceline.com to compare prices, times, and availability across various airlines, Priceline can target that consumer with offers for the itinerary previously searched (but not purchased) or send suggestions for future flights from the consumer’s indicated home airport to a region that the consumer indicated in a previous search. By utilizing observed consumer behavior, marketers are able to create content and messages that are relevant to that specific consumer, in a specific location (placement) or media type (banner ads v. blogs/interactive communities).

Efficient and Cost Effective Method for Targeted Reach

The advent of the Internet and digital communication space presented marketers with an immense opportunity to communicate messages and product information quickly and cost effectively. It is important to reach the right audience at the time they are most receptive to marketing messages for a specific product or service. Digital marketing allows marketers to reach consumers throughout their busy day, thus no longer restricted to traditional television, print, and radio timeslots. By including this capability in a marketing campaign, digital advertising enables marketing campaigns to leverage content and messages across various advertising vehicles (traditional and digital) in a cost effective, highly targeted manner.

Prior to digital options, marketers were not able to gain national reach with a single marketing campaign. However, digital marketing allows companies to develop algorithms that make it easy to aggregate individual networks of target consumers and to plan, create, and optimize advertising to reach a national audience that transcends geography and is tied to consumer preferences and interests. For example, results have shown that an aggregated network approach can deliver more than 50 million weekly gross impressions across nearly 30,000 locations around the country — all from one network. Given the consumer need for two-way conversations with marketers and communities, web applications like Facebook, blogs, and other Social Networking Sites (SNS) are cost effective tools to reach consumers (the majority of these tools are free, only requiring maintenance and observation from a company).

Changes in consumer behavior and interaction with marketing messages have made digital marketing a necessity to any marketing campaign. Increased research by consumers for purchase decisions, heightened word-of-mouth among consumers, and consumer preference for pull v. push marketing have elevated the importance of digital marketing and made it a necessary component of today’s competitive marketing plans. However, digital marketing also offers several strategic benefits for companies. Savvy marketers utilize digital marketing to gain deeper consumer insights and as a method to create tailored and adaptable consumer targeting. An additional appeal is that digital marketing allows companies to be more efficient and cost effective in their marketing efforts, with the ability to measure campaign effectiveness and success.

So what is Digital Marketing?

Digital marketing encompasses all digital channels for communicating or receiving information, and is not limited just to Internet vehicles. This includes the Internet, mobile phones, SMS messaging, digital outdoor displays (Times Square billboards), and other digital forms of media . Each tool can be classified into either Paid Media or Earned/Buzz Media. Paid Media is publicity gained through advertisements that the brand/product undertakes and controls to communicate information or appeal to consumers. Earned/Buzz Media, one of the most powerful tools, refers to favorable publicity gained through promotion efforts from others outside of the brand and advertising team (i.e. the brand and advertising team does not have direct control). A component of Earned Media, Social Media encompasses publicity gained through grassroots efforts specifically on the Internet. Simply put, Earned/Buzz Media is your content or message, shared by your customers through email, blogs, social networking sites, and other word-of-mouth tools . Figure 1 below broadly categorizes various digital tools, predominantly online tools, into Earned and Paid Media. Additionally, these tools are broken into the five most commonly discussed categories of Word-of-Mouth (WOM), User Generated Content, Search Optimization, Owned Content, and Communication.

Figure 1: Digital Marketing tools Categorized by Type and Function

Traditional marketers spend about 60% of their media budget on paid media, 20% on content creation, and the rest on overhead expenses (such as agencies and employees). Digital marketers spend approximately 30% on paid media and 50% on content . This is in part attributable to digital marketers relying on users to disseminate information through Earned/Buzz media, which places more emphasis on creating buzz worthy content material. Additionally, creative content has grown in importance as a means for breaking through the abundance of marketing messages aimed at consumers. Further discussion of these trends will follow.

Paid Media

Paid Media is one of the oldest forms of advertising and is exactly what it says it is; It is a company or brand buying advertising space or paying someone (television, radio, print, product websites, banner ads, etc.) to communicate their product benefits and influence a consumers’ purchase decision. Paid media within the digital marketing space encompasses Search Optimization, Owned Content, and Communication tools. Marketers have direct influence and control of these tools, often utilizing a mix of them to achieve marketing objectives.

Search Optimization

Today, search has become second nature to many consumers. The term “googling” is no longer applicable just to the Google search engine, but serves as verb for online information gathering activities. Often associated with the quest for information, search is a powerful tool for companies. Search includes Paid and Organic search results. How does Search work? For demonstration, Google is the market leader and a great illustration of today’s search environment. Google ‘crawls’ and catalogues hundreds of thousands of websites to create an index of various factors. When a consumer uses Google to start a search, they type in their search query. Utilizing an algorithm based on over 200 factors (includes factors like most viewed, similar searches conducted by other users, keywords, most recently updated, etc), Google will provide a ranked list of possible websites that contain the desired information. The first two links on the search page are paid advertisements (ie. a company has paid to have their website appear first). The remaining links in the results are organic search results, meaning these are websites that match the keywords or search query terms inputted by the consumer. Statistically, it has been shown that many consumers do not go beyond the first page of search results. Thus, it is important to have a website appear on the first page and preferably at the top of the listed sites. Ultimately, search engines are committed to providing relevant information to consumers, as easily as possible. This ensures that the searchers continuously return to their search engine, thus building a base or audience that the search engine can then use to gain advertising dollars from companies and brands.

Paid Search

During the nascent phases of Internet marketing simple paid search, also known as sponsored links, tactics ruled the landscape. Paid search are web site links that a company or individual pays to be placed at the top of search engine results or as a search ad that appears in the side bar area of the search results page. The appeal of paid search, especially for those companies paying to have their link as the first two results, is that consumers do not look beyond the first page of search query results. As does every tool, paid search has benefits and disadvantages. Benefits include higher purchase intent/interest from consumers (they are already searching for the product/service) due to searchers already being predisposed, thus a prime consumer, to a specific product or service. Paid search also allows companies to instantly be placed in prime search result position, as opposed to organic search that can require months to gain credibility for higher search result position (preferably on the first page of results). Paid search also allows marketers access to data that can be used to enhance websites, messages, and content to increase relevancy to visitors. Finally, paid search is versatile and can be used by any size business and content/messages can be easily developed, adjusted and implemented based on click thru rates by consumers.

Additionally, paid search is fairly cost effective. Paid search, unlike organic search, has fees that can be easily controlled by a company. Budgets can be adjusted to set daily or monthly limits on how often to place an advertisement in specific locations, as well as how many pay per clicks to allow. Generally the popularity of keywords and the number of clicks on the web site link are the driving costs within Paid Search. Depending on the popularity of certain words, search engines like Google will charge a premium to place sponsored links at the top of the search results. Pay-per-click creates an environment where companies are paying for every click a consumer makes on their sponsored search links or advertisements located on the side of the search results display page, as well as the time of day the search was conducted (similar to prime time advertising on TV commanding a premium over off-peak times). To maximize return on paid search, marketers must have knowledge of consumer behavior and preferences to ensure that the messages and links appear when the key influential search words for a particular product/ service are entered and during periods when the target consumer is interacting on the digital platform.

Organic Search Results As consumers become increasingly savvy in their search queries, they often tune out paid search advertisements. This is not to say that paid search is not important, rather that consumers often seek alternate links to validate the information gathered from paid search. Consumers believe that organic search results are more relevant and offer more depth to their information gathering process . Organic search results, as mentioned, are those listings that match keywords a consumer has used in their search query. These results are listed based on many variables within an algorithm designed to present the searcher with the most relevant information for their needs. Because these are natural results, there are no costs associated with appearing as part of organic search results. Given that organic search results are free and often more credible to consumers, companies are interested in search engine optimization. Search engine optimization (SEO) refers to activities that will increase the traffic and click thru rates from search results to the website, while also improving the quality of search results, by ensuring those key words most used by or relevant to consumers’ are built into the web site’s content.

Figure 2: Example of Search Results on Google with Paid and Organic Search Results highlighted

There are several ways to game the search process; however the easiest and most transparent to consumers is to develop content and messages that incorporates relevant keywords and phrases. By ensuring transparency between search queries and content on a website, found through search, a marketer can build credibility for the product and company. Another tactic to create stronger natural search results is to cross link web pages. By increasing the frequency of certain links, the algorithm considers the linked webpage as more relevant source of information. As consumers demand increased interaction with marketers and two-way conversations, many have predicted that paid advertising will become irrelevant . However, no other form of advertising offers the immediacy and scale that paid advertising offers. Thus, the role of paid advertising may shift from a single, transaction focused activity to one that drives further engagement and communication with target consumers. Given this, marketers can optimize search results to drive consumers who are actively seeking ways to interact with a brand to social communities and blogs that encourage consumers to engage for more information.

Owned Content

Although it has never been easier for consumers to access company content and receive marketing messages, the competition for consumer attention and consideration is fiercer now than ever before. This is primarily due to digital marketing lowering the barriers of entry for companies to advertise and launch new products. Given that consumers are inundated with information, content and creative executions have become very critical to gain consumer attentention. Content is increasingly just one component of a fragmented and interactive landscape, where content and word-of-mouth are dependant on each other . Ultimately, in today’s landscape, owned content should be designed to engage directly with consumers and create a holistic, simple brand message to serve as an anchor across that all media types (traditional and digital) . Owned Content is disseminated across various vehicles that the company/brand maintains and controls. Owned content is generally created by the brand to reach a specific target consumer group. It is generally what search engines would index, thus should be optimized to ensure visibility and relevance in search queries. Owned content spans many platforms including product/brand websites, placed marketing messages, e-commerce stores, information shared in other forums (such as blogs), SNS product pages (a product’s Facebook page where consumers can become ‘fans’), etc. Additionally, owned content also is what appears in traditional marketing platforms, such as TV, print, and radio. These traditional platforms are exported by consumers to the digital space (often when they are buzz worthy).

The power of owned content rests with the development of a holistic message, which builds brand awareness across all media types that is relevant to your target consumer. Additionally, owned content should be poised to build long-term relationships with consumers. How have successful companies created appropriate content? To create relevant content, first establish who you are targeting and what you would like to convey to them. The message should be simple, that will transcend many advertising campaign iterations (timeless) and be applicable to various platforms (adaptable to both digital and traditional marketing vehicles). This simple idea should drive the marketing strategy, including the tactics employed in the digital space. The various marketing platforms need to utilize the same look, tone, and feel. All media forms should utilize this idea to create cohesion between platforms, thus increasing retention of the message in consumers’ minds. Ultimately, the goal should be to create content that is simple and sticks.

An example of cohesive owned content that is simple and sticks in consumer minds is GE’s “Imagination at Work, HBO’s “It’s not TV, its HBO”, and Burger King’s “Have it your way” campaign. To delve into how simple brand promise can be effectively translated into messages, Burger King serves as a good example. This simple brand promise of consumers controlling their experience allowed Burger King to set itself apart from competitors. The campaign, originally conceived in 1974, was rejuvenated in 2004 when Burger King launched a new chicken sandwich that met a developing need of its core consumers. This idea of individuality played well in the digital marketing space where consumers interact with brands and control their online experience. Burger King targeted their “super fans”, 18-34 year old males, who were busy and often ate meals outside of their homes. These consumers also spent a lot of time on the Internet and used it as a virtual playground. Based on these consumer insights, combined with the Burger King brand promise of “have it your way”, the company launched “The subservient chicken” campaign that became an instant hit. The campaign portrayed the new sandwich as the “your way” solution for the emerging desires regarding chicken sandwiches. Burger King also utilized an interactive website that had an individual impersonating a chicken. This impersonator would react to user commands to act out wild and weird things – headstands, singing, reciting Shakespeare, playing golf, moon-walking like Michael Jackson, etc. If asked to do something offensive, the impersonator would walk towards the camera and admonish the user. In the end what made this campaign so successful was that it spoke to the brand promise of “have it (chicken) your way” and leveraged consumer insights to ensure the initiative was relevant to the target audience. The campaign’s owned content was a success with audiences, spurring viewers to pass along links through YouTube and SNS sites, creating significant earned/buzz media. Burger King saw a 32% increase in stock price, as well as an increase in store year-over-year sales, during the period the campaign was executed.

Communication

For those consumers older than 25, remember all those direct mailers that would advertise products or services? Promotional offers, especially credit card offers, seemed to arrive daily. With digital marketing, brands are able to send direct offers to interested consumers through email, mobile, chat, etc. Marketers can send tailored messaging that incents consumers to interact with a brand, educates consumers on promotions, and influences consumers at point of sale. Generally more of a push method of marketing, direct communication offers marketers a method to drive “calls to action” by consumers. This type of consumer engagement allows marketers to reach consumers when they are not specifically searching for information. These tools can be used to re-introduce products or brands into the consumer minds, eventually leading to greater recall and inclusion in initial consideration set when consumers are thinking about related products/brands.

Earned/Buzz Media

As Marc Pritchard said, digital marketing allows brands to connect on a personnel level with consumers. It is this personnel connection that drives earned media. Earned media includes any organic, viral, or natural promotion of a brand’s content without direct influence by the brand. In the digital marketing space, earned media has exponential grown in ability to influence consumer decisions making. What your consumers say will influence brand awareness, market shares, and overall sales performance. However, it is worthwhile to note that earned media is a direct reflection of a brand/product’s actions within the paid media space. Specifically, earned media is gained both by digital efforts, as well as any other type of marketing activity that drives awareness of a brand (i.e. Retail store displays and promotions).

The frightening part to marketers of earned media is that there is limited to no ability for them to control what consumers choose to share. This fear is compounded when trends in consumer behavior indicate that earned/buzz media carries more weight and credibility than paid media. This is in part due to perceptions of impartiality since the content is produced by third party sources. Although Earned/Buzz media can be intimidating for brand teams, there is significant opportunity to marketers to observe and engage in these conversations. Brands are able to participate in conversations, but not control them. To gain consumer trust, brands must be transparent in their participation (ie. disclose that comments and participation are on behalf of the brand) and let conversations remain authentic.

Word-of-Mouth (WOM)

"Instead of marketing at customers, our job in the digital age is to get customers working with us and for us. And you do that by working with them and for them. This is where the new marketing energy and breakthrough results are to be found." ~ Mark Beeching, Digitas - Chief Creataive Officer

Today, it seems everyone has some social networking platform they consistently use. Twitter, Facebook, LinkedIn, and emerging sites like FourSquare allow consumers to connect with one and another easily through common interests and needs. Today, 68% of consumers are more likely to believe other consumers than to believe traditional media sources , demonstrating how critical it is for brands to fulfill their promise.

Consumers have always been powerful marketers. Previously, word of mouth conversations would occur across the back yard fence amongst neighbors, or among family and friends at gatherings. Now, digital tools available to consumers have evolved WOM from limited conversations with immediate, personal networks into many “Virtual Conversations” with multiple digital networks, where whispers can turn into a verbal tsunami . Consequently, WOM conversations in the digital space reach much larger audiences and have significantly more amplified voices .

Consumer-to-consumer conversations are occurring across various SNS, blogs, and message boards, to name a few. With 82% of US online adults utilizing SNS, social marketing is one of the key tools for marketers to monitor WOM conversations. WOM can instantly make a brand a success and just as quickly cause a brand to crash. As a result, brands must be able to ensure that consumer expectations of products, customer service, advertising claims, and even sales/store personnel are always met . Consequently, there is limited room for brands to not deliver on promises. Thus, it is important for brands to have a formal process to monitor online conversations regarding the brand. By gathering both the good and the negative consumer perception and experience information, brands can address rumors, identify product development opportunities, and evolve from good to great brands. In order to do this successfully, brands must actively listen to consumers, assess the situation, and deliver on any expectations or promise made during conversations. Given how ferociously guarded consumers are about their social forums and WOM tools , marketers should again be transparent and indicate that they represent the brand in all communications.

Although WOM marketing is not controlled by marketers/brands, it represents another significant opportunity for savvy marketers. Through monitoring online conversations, brands can identify advocates among consumers. These advocates, also referred to as brand evangelists or mavens, are those online community members that are perceived by consumers as knowledgeable and have authority for your category and product. Given the perception that advocates and other WOM agents do not have ulterior motives, consumers are willing to listen to their perspectives. By engaging these individuals in conversation, these brand ambassadors will be equipped with information by which to influence other consumers’ choices .

An example of effectively utilized WOM and influential bloggers as advocates was in Toyota Prius’s launch strategy. Prius had developed an active user community, where new or prospective users were mentored by current Prius owners and brand advocates. These advocates frequently educated users on current cars in the market, provided reviews of the Prius, and discussed desired product improvements for new models. When Prius was beginning to consider how to launch the new model, they hired MotiveQuest (a Chicago based company that monitors various social media platforms and digital conversations to gain consumer insights) to identify consumer insights. MotiveQuest identified that consumers and brand advocates were discussing product features that the new Prius would not provide. Prius agreed to engage their advocates, the most influential bloggers, by inviting them to experience the new Prius. These advocates were invited, in a top secret invitation, to the Detroit Auto Show, where they received VIP access to the new Prius Model before any other industry professionals or consumers. Additionally, Toyota’s chief engineer flew in from Japan to answer any questions about the product and decisions about development activity. Through this exclusive, full access event that brought together influential bloggers, Prius was able to communicate why the new model brought significant improvement for consumers and why current conversations about needs was not as immediately relevant. After their trip, the advocates returned and were able to freely blog about their experience. Soon, these advocates were informing consumers that the new Prius’s features were more important than the former consumer needs. This created excitement for the new Prius model and eliminated consumer perception barriers that had existed before the brand educated advocates.

By inviting consumers to interact with the brand and understand the product development decisions, Prius enabled advocates to blog, create Buzz and WOM recommendations for the new Prius model launch. Effectively, the brand utilized their strongest advocates to influence bloggers’ focus to support the new model, rather than discussing what the new model would not be offering. The strategy also leveraged key insights of the Prius community behavior and tapped key motivators of advocates (such as exclusive access to the car and chief engineer) for positive results.

User Generated Content

“It is imperative that a brand create quality content, but also nurture the source of content that will yield the most control over the brand – the customers!” - Rebecca Murtagh – Marketing Strategist

From blogs, to product reviews posted on Amazon.com, to YouTube videos Internet users generate an immense amount of content. User-generated content, also known as user-generated media or user-created content, are various digital tools where end-users control the creation and distribution of messages and media. These tools include digital videos, Podcasts, databases to answer questions, wiki’s, SNS, and blogs. These tools are used to publish information, ranging from the latest celebrity gossip/sighting, to news, product experiences, and research. User generated content exemplifies the two-way conversation that has emerged with the popularity of various digital tools and often uses collaboration and viewer reactions to increase credibility. These digital platforms, as well as advances in technology complements (digital cameras, music creation/ editing software, smart mobile phones etc) have created easy, user friendly ways for users to create content and share with online communities.

User generated content allows consumers to express opinions and share interests across various platforms, making it a powerful WOM tool. Although it is easy to understand a consumer’s benefits from user generated content, the benefit to the content producer is more ambiguous. Given the massive amount of content generated by users, there must be some benefit. Experts have speculated that motivation for creating content ranges from altruism, social, and materialistic desires. Many marketers, wanting to leverage the power of user generated content (which creates buzz and deepens consumer engagement), have started offering incentives to incent content producers to create relevant and quality content.

Incentives can be broadly categorized into two categories: Implicit and explicit . Implicit incentives are intangible benefits that a content creator would receive, such as social incentives that make the creator feel good. This incentive form could include increasing the number of relationships with other users (“I have over 1000 friends on Facebook!”), gaining credibility (other users rating and providing feedback to the content created), achieving exclusivity based on participation (bloggers being invited to interact in product development initiatives). Implicit incentives that motivate user engagement, leading to content creation, are ideal for brands because it costs very little to host and disburse viral content. However in order to gain the most impact, content creators must be part of a large, existing community.

Explicit incentives are more easily understood and includes those tangible benefits where the creator would receive some kind of financial payment, contest entry, coupons, frequent flyer miles sweepstakes, etc. in return for their user generated content. Although explicit incentives provides strong motivation to content creators, it also can create an environment where consumers see the created-content as part of the “paid media” category and no longer believes it is impartial.

FritoLay has successfully utilized both implicit and explicit incentives to engage consumers to create innovative customer-created ad campaigns such as “Crash the Super Bowl”, “Fight for the Flavor”, and “The Quest” . In the “Crash the Super Bowl” initiative, Doritos engaged consumers to create advertisements for the Doritos brand which would be aired during the Super Bowl. When the initiative first launched, it offered consumers an opportunity to submit self made TV ads that would be broadcasted during the 2006 Super Bowl. Due to the success of this initiative, Doritos has continued the initiative.

For the 2010 Super Bowl, Doritos had over 4000 entries from prospective copy writers, art directors, directors and producers. From these contestants, Doritos chose 6 finalists and then solicited consumers/public to vote on their favorites (Doritos leveraged YouTube, Vimeo, and their own website to allow consumers to view the finalists’ ads and create buzz to drive further engagement). Content creators received not only implicit incentives (bragging rights associated with having their ad aired during prime, Super Bowl advertising time), but also they had the opportunity to receive financial incentives based on how well their ad performed on the USA Today Ad Meter. For the ad that secured the #1 spot, the creator would receive $1 million. For the ad that secured the #2 spot, the creator would receive $600,000. And finally, for the ad that secured the #3 spot, the creator would receive $400,000. The largest payout for content creators would come if all three ads swept the top 3 Ad Meter positions, earning each creator an additional $1 Million. Given these explicit incentives, Doritos could have paid up to $5 million for the user-generated content . Doritos successfully leveraged its consumers to create relevant content by offering incentives that were integrated with online community preferences/consumer insights and marketing objectives.