What’s Keeping
Marketers Awake at Night
John Gustavson
President and Chief Executive Officer
Canadian Marketing Association
CMA Ottawa Chapter
January 30, 2007
© 2007 Canadian Marketing Association
10 buzzwords not to use in
a marketing presentation…
…from the home office in Wahoo, Nebraska
1.
2.
3.
4.
5.
outside-the-box
synergy
the big idea
ROI
paradigm shift
6. customer-centric
7. critical mass
8. buzz
9. it is what it is
10. low-hanging fruit
Courtesy the Creative Group
© 2007 Canadian Marketing Association
Four market realities
1. Post-Enron marketplace -- More
shareholder/public scrutiny
2. Ethical and trustworthy companies
being rewarded with higher degree of
customer loyalty
3. Government will step in if we don’t
effectively self-regulate
4. Canada facing economic uncertainty
© 2007 Canadian Marketing Association
Four marketing realities
1. Consumers have more choice
2. Technologies changing at lightning speed
• Push marketing doesn’t work anymore
• Consumers determine how they will interact
with marketers
3. New media leading to brand fragmentation
4. More pressure on marketers to make
measurable contribution to bottom-line
and to deliver strong brand value
© 2007 Canadian Marketing Association
Hot marketing issues
1.
2.
3.
4.
5.
6.
7.
Building brands in a complex environment
Marketing ROI
Managing the customer relationship
Emancipation by technology
The talent crunch
The delivery infrastructure
Government’s agenda
– National DNC List / telemarketing rules
– Consumer privacy
– Identity theft
© 2007 Canadian Marketing Association
Hot marketing issue
Building brands in
a complex environment
© 2007 Canadian Marketing Association
Hot marketing issue
The Brand
• Building brands in a complex environment
– Eight key factors
1. Globalization/internationalization
– Impact of U.S. and international brands
– Challenge “Canadianizing” global brand
– Local brand management – is Canada just a U.S.
branch office – are decisions going south?
2. The empowered consumer
– More choice -- Today’s average consumer hit with 20
times as many messages compared to five years ago
– Control of experience – driven by want vs. need
© 2007 Canadian Marketing Association
Hot marketing issue
The Brand
• Building brands in a complex environment
– Key factors (continued)
3. Media
– Cutting through the clutter major challenge for brand
managers
– Proliferation of new media/fragmentation
– Consumer-generated media/interactive
– Message blocking/filters
– Shouting “at” consumers doesn’t work – successful
organizations talk “with” consumers
© 2007 Canadian Marketing Association
Hot marketing issue
The Brand
• Building brands in a complex environment
– Key factors (continued)
4. Technology
–
–
–
–
Consumer customization, personalization
First to market importance
Moving from supply to demand economy
Pace of change unpredictable -- Time to market/cost to
market
5. Economic pressures – CMO taking back seat to CFO
© 2007 Canadian Marketing Association
Hot marketing issue
The Brand
• Building brands in a complex environment
– Key factors (continued)
6. Demographics
– Baby boomers vs. the online generation
– Impact of Canada’s multi-cultural mosaic
7. More public moral code
– Moral persuasion / government “suasion”
– Ethical business wins
8. Organizational change – who owns the brand?
© 2007 Canadian Marketing Association
Brand 101
The Brand Hierarchy
The governing ideals that
marketers leverage to build
brands
Brand Esteem
Customer Experience
Brand Knowledge
Relevance
Differentiation/
Leadership
© 2007 Canadian Marketing Association
Globalization
Differentiation
& Leadership
Relevance
**
Stewardship
Media
Technology
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* *** *
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**
*
*
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**
Customer
Experience
Brand
Esteem
Empowered
Customer
*
Economic
*
Moral
Code
*
*
**
Brand
Knowledge/
Comm.
© 2007 Canadian Marketing Association
** ** **
Organizational
change
*
*
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** *
Demographics
*
* ***
*
Hot marketing issue
The Brand
• Building brands in a complex environment
– Conclusions:
• The brand is in a period of progressive change
• Organizations that are flexible & relevant will win
• Marketers need to engineer the ideal customer
experience
• Marketers need to better understand what makes
the empowered consumer tick
© 2007 Canadian Marketing Association
Hot marketing issue
MARKETING ROI
© 2007 Canadian Marketing Association
Marketing ROI
Barriers to marketing ROI:
1.
2.
3.
4.
Difficulty agreeing on common definition
Lack of accepted cause and effect
Lack of data reporting capability
Lack of finance buy-in -- arriving at a number
that will withstand CFO scrutiny
© 2007 Canadian Marketing Association
Hot marketing issue
• Marketing ROI
– Marketers under constant pressure
to prove their impact on overall business
• Challenges:
– Main challenge for marketers is to better understand
what they’re measuring and why
– Pressure from CEO/CFO to provide immediate shortterm results can jeopardize long-term brand health
(equity markets focus on quarterly returns)
© 2007 Canadian Marketing Association
Hot marketing issue
• Marketing ROI
– No longer realistic to function in a silo where
activities and successes are separate from
overall corporate goals
– Successful marketers shifting measurement thinking from being
campaign/product ROI focused to being more customer centric
– Latest Longwoods AdTrac study finds that 80% of marketers
agree with the statement “it is important to have a measure of
ROI that deals with delivery and consumption across multiple
channels”
© 2007 Canadian Marketing Association
Hot marketing issue
MANAGING THE
CUSTOMER RELATIONSHIP
© 2007 Canadian Marketing Association
Hot marketing issue
• Managing the customer experience
– Managing the customer relationship where
the consumer is more empowered is
especially daunting
– Marketers need to:
• Respond to customers’ individual needs
• Anticipate changes in those needs
• Have the right tools to deliver
© 2007 Canadian Marketing Association
Hot marketing issue
• Managing the customer experience
– Canada above global benchmark in:
• Data collection and use
• Customer information
• Customer experience
– Canada falls below global benchmarks in
terms of process management, technology
support and retention
© 2007 Canadian Marketing Association
Hot marketing issue
EMANCIPATION
BY TECHNOLOGY
© 2007 Canadian Marketing Association
Hot marketing issue
• Emancipation by technology
– Personalized media technologies have
spawned a "networked self" that is shaping
consumer marketing and society at large
Faith Popcorn
– Seismic shift in brand-customer relationship
• Negative customer experiences are broadcast to the world
– Blogs, MySpace, YouTube
• Impact of search marketing
– Does Google own the brand?
© 2007 Canadian Marketing Association
Hot marketing issue
• Emancipation by technology
– Flip side: More choice for marketers
• Important to engage in two-way dialogue
• Push marketing doesn’t work anymore
• Blog disclosure/transparency a major issue for
corporations and consumer groups
– “Paid” bloggers cited in Edelman/Wal-Mart case –
October 2006
© 2007 Canadian Marketing Association
Hot marketing issue
• Emancipation by technology
– Conclusion:
• New technologies are universal listening tools
• Creative marketing using new technologies can
be very rewarding if done right -- it can also be
destructive and dangerous for a brand
© 2007 Canadian Marketing Association
Hot marketing issue
THE TALENT CRUNCH
© 2007 Canadian Marketing Association
Hot marketing issue
• The Talent Crunch
– Inability to attract and retain talent number
one threat to Canadian corporate profitability
Accenture – December 2006
– 26% of Canadian employers find it difficult to
fill permanent professional positions (lumped
into this group are marketing staff) due to lack
of available talent that is threatening growth
plans
Manpower Inc. – October 2006
© 2007 Canadian Marketing Association
Hot marketing issue
• The Talent Crunch
– Staff turnover big issue
• Average CMO’s tenure just 23 months/brand
manager on the job for 18 months
• Impacts brand
• Impacts agency/client relations
– Major loss of intellectual capital when
personnel changes every two years
© 2007 Canadian Marketing Association
CMA educational programming
• Conferences
–
–
–
–
–
–
–
–
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Advertising/Marketing Forum
B2B Marketing
Not-for-Profit (half-day)
Word of Mouth Marketing
Branding
Regulatory
Digital Marketing
Direct Marketing
Marketing ROI
February 15
March 1
March 28 & Sept. 20
April 12
June 21
September TBA
October TBA
November TBA
November 22
• Seminars (Spring 2007)
– E-newsletters, introduction to direct marketing, blogs, data mining,
copywriting, loyalty programs, effective persuasion
• Customized in-house training
© 2007 Canadian Marketing Association
Hot marketing issue
• The delivery infrastructure
– Current four-year agreement between
Canada Post and CUPW expires Jan. 31/07
• Talks under way to reach negotiated settlement
• Potential summer of labour unrest
© 2007 Canadian Marketing Association
Hot marketing issue
Government’s agenda
national DNC list
tougher telemarketing rules
consumer privacy
identity theft
© 2007 Canadian Marketing Association
Government agenda
© 2007 Canadian Marketing Association
Government agenda
• National do-not-call list
– Dec. 2004 -- Bill C-37 introduced in House of
Commons
• Spelled potential disaster for business
– 2005 – CMA appears before government
• CMA successful in securing:
– Exemption where there is an established business
relationship
– Reasonable penalties
– Exemption for charities
– Nov. 2005 – Canada introduces amended legislation
© 2007 Canadian Marketing Association
National DNC List
• Definition of “existing business relationship”:
– 18 months – exists where a consumer has made
a purchase or donation, has rented, leased or
contracted for, or has otherwise participated in a
organizations provision of products or services
within the past 18 months.
– 6 months – exists for six months from the date
of an inquiry or application from a consumer
© 2007 Canadian Marketing Association
Government agenda
• Telemarketing
– Several outstanding issues (B2B exemption, list
cost to business, government responsibility for
execution, enforcement, complaint investigations
and consumer education)
– Choosing DNC List operator part of government
procurement process
– February/March:
RFP to be issued
– Late 2007/Early 2008: DNC list up and running
© 2007 Canadian Marketing Association
Government agenda
• CRTC also conducting wholesale review of all
telemarketing rules (Note: No exemptions here)
– CMA still stands by 2004 position
• Need for universal calling hours
• Seller-specific internal DNC lists
• No agency-specific DNC lists
• No need for unique registration number
• No toll-free number or live agent requirement
• 31-day enforcement window (for both internal & national
DNC lists)
• No change to existing and contact info rules
• ADADs and voicecasting permitting for B2B & EBR
telemarketing
• PDD: maximum 5% abandonment rate
• Spring 2007: CRTC to finalize telemarketing rules
© 2007 Canadian Marketing Association
Government agenda
• Consumer Privacy
– Federal privacy law undergoing mandatory
five-year parliamentary review
• Consumer groups want higher level of consent
and stronger enforcement
• Privacy Commissioner:
– Not looking for more enforcement power
– Believes law is “generally working well”
– Some concerns around notification of privacy breaches
and transborder flow of personal information
© 2007 Canadian Marketing Association
Government agenda
• Review of federal privacy law
– CMA appeared before Commons Committee in
mid-December (first national association to
appear before hearing):
• Law appears to be working well
• Too early to make any substantial changes
© 2007 Canadian Marketing Association
Government agenda
• Review of federal privacy law
– CMA position on data breach notifications:
• Organizations have responsibility to notify
consumers where loss or theft of personal
information poses reasonable risk of harm
• Challenge to establish correct threshold for
triggering notification
• Need for national guidelines
© 2007 Canadian Marketing Association
Government agenda
• Review of federal privacy law
– Outcome unknown at this time
– Growing uncertainty:
• Escalating pressure from privacy advocates for
tougher privacy laws
• With prospect of federal election, easy win for
politicians
– Hearings continue
– Draft report expected in Spring 2007
© 2007 Canadian Marketing Association
Other major threat – identity theft
© 2007 Canadian Marketing Association
Other major threats
• Identity theft
– People believe their personal information is at
risk – phishing attacks, transaction security,
credit cards, spam
– Number one privacy concern or “worry” for
Canadians
– Top consumer complaint at U.S. FTC
© 2007 Canadian Marketing Association
Other major threats
• Identity theft – phishing attacks
– 176 brands hijacked in October 2006
– Single record for one month (96 brands
hijacked in October 2005)
– Financial services
#1 target
Source: Anti-Phishing Working Group
© 2007 Canadian Marketing Association
Conclusions
1. Consumers more empowered than
ever before
2. More and more difficult to build brand
3. More pressure to deliver ROI
4. New media/technologies changing at
lightning speed
5. Big brother is watching
© 2007 Canadian Marketing Association
Ongoing CMA role
ADVOCACY
• Government relations
• Self-regulatory initiatives
– Do Not Contact service
– Code of Ethics and
Standards of Practice
© 2007 Canadian Marketing Association
Ongoing CMA role
KNOWLEDGE
• Expanding “marketing thought leadership”
offering on the hot issues facing marketers
– New marketing blog:
www.canadianmarketingblog.com
– New Advertising and Marketing Forum on
“The Business of Ideas” – February 15
– B2B Conference – March 1
– New content on CMA website: www.the-cma.org
© 2007 Canadian Marketing Association
Ongoing CMA role
COMMUNITY
© 2007 Canadian Marketing Association
10 buzzwords not to use in
a marketing presentation…
…from the home office in Wahoo, Nebraska
1.
2.
3.
4.
5.
outside-the-box
synergy
the big idea
ROI
paradigm shift
6. customer-centric
7. critical mass
8. buzz
9. it is what it is
10. low-hanging fruit
Courtesy the Creative Group
© 2007 Canadian Marketing Association
What’s Keeping
Marketers Awake at Night
John Gustavson
President and Chief Executive Officer
Canadian Marketing Association
CMA Ottawa Chapter
January 30, 2007
© 2007 Canadian Marketing Association