Promotions 2.0

PROMOTIONS2.0 The future of

interactive marketing

The Big ShiftAdvertising isn’t what it used to be

New technologies,fragmented media, and a new

generation of empowered consumers

are rapidly changing the world of advertising...

We’re Spending Less Time Here...

Radio-19%

TV-33%

Print-30%

Arbitron Research: Internet and Multimedia Study

Time spent with traditional media is declining

...And More Time Here.New technologies are captivating consumers

David Schenk, Marketing Smog

In 1971, the average person encountered

approximately

500 ad messages a day

Media fragmentation is increasing.

7

Today, that number

is almost

5,000

David Schenk, Marketing Smog

making it harder toengage consumers.

Online Advertising

“CPM Rates have been flat with

declining results for the past 2 years.”

Average click through rates now .01%

Paid Search “Losing its luster and expected to peak this year, followed by a decline.”

Borell Associates: The Big Shift Research Report (April 2008)

PASSIVE

Digital Consumersare shifting from passive shoppers to active brand participants

36 million Download music or video*

user

40 million Browse the web fromtheir mobile phone**mobile

50 million Have created online content*

producer95 million

Participate in online Contests

& Sweepstakes****participant

110 million Participate in

Social Networks*

community

200 million US consumers have shopped online

Over 875 million worldwide***

customer

*Pew Internet & American Life **Nielson Mobile study *** ComScore ****NY Times E-Commerce Report Image: David Armano

0

7.5

15.0

22.5

30.0

Promotions Email Search Video Display

2008 2012

Source: Borell Associates inc. 2008

($ in

Billi

ons)

Online PromotionsSpending expected to surpass other online advertising

categories over the next 5 years.

Because promotions deliver results...

60%of US consumers have purchased a brand due to a promotion.*

82%of consumers will provide personal information in exchange for a chance to win.***

*IMI International **eMarketer ***Jupiter Research: Online Privacy Report

80%of online consumers have entered a sweepstakes.**

The New Marketing MixDigital Promotions + Advertising

Promotions + AdvertisingIncreased relevance & entertainment4

Brand Advertising Low Relevance - High Creative

Local or NicheHigh Relevance - Low Creative

Mass MarketingLow Relevance - Low Creative 1

2

3

Relevance & Entertainment* 2 axis that create consumer value in marketing:While all marketing is capable of playing in quadrant four, no single medium has broken through.

Rel

evan

t

Entertaining High

1

2

3

>Low >

>

>

Low

High

44

Increased Value Increased Value

Quadrant 4 = most value

Source: Joseph Jaffe

By combining digital promotions & advertising both relevance & entertainment value is increased moving closer to Quadrant 4.

Old Marketing New Marketing

Spray & Pray

Large Audience

Low Relevance

Low Return

Attract & Engage

Smaller Audiences

High Relevance

High Return

Promotions 2.0Marketers are using digital promotions today

to create buzz & cut through the clutter

Digital PromotionsFrom Brand Awareness to Engagement

Bra

nd A

war

enes

sHigh Consumer Involvement

Bra

nd E

ngag

emen

t

Low Consumer Involvement

>>>

>

Sweepstakes

Mobile

Instant win

Advergames

UGC

Social

Core Audience

Extended Audience

70% of CPG Super Bowl Advertisersused interactive promotions at the core of their 2008 campaigns.

Source: Promo Magazine

User Generated Contestsdeep brand engagement & active participation

Doritos changes the gameContest winner beats out madison avenue

winning USA TODAY'S 2009 Super Bowl Ad Meter

Advergamesbrand messages become viral brand experiences

30% of Super Bowl viewers say they are more likely to visit an advertiser's Web site after seeing a Super Bowl commercial*

*2009, Harris Interactive Poll

Advergamesbrand messages become viral brand experiences

0

10

20

30

40

Advergames Video Tell-a-FriendAdvergames/

MicrositesOnline

ContestsSocial

BookmarkingTell-a-friend

Viral Video

Viral Marketing Tactics with “Greatest Results”*

* 2008 eMarketer, Viral Marketing Survey

Mobile Integrationparticipation anytime or anywhere

97% of consumers carry their phone at retail** Promotion Marketing Association Digital Summit

Largest US SMS Promotion New technologies driving innovation

Inclusive Experiences Everyone wins something. Someone wins everything.

One person win a trip to the World SeriesEveryone wins a taco if base

is stolen during the game

One college wins a private concertwith the Dave Matthews Band

Everyone watches online

Social Promotionspromotions worth talking about

Facebook: 220 million visitors monthly* Super Bowl: 98 million viewers**

People Magazine: 3.6 million readers monthly**

*Comscore **infoplease.com

Promotion HellPoor planning can lead to big problems

Warning!Promotions are regulated & must comply with federal and

state laws to avoid civil & criminal penalties.

Axl Rose vs. Dr. PepperEveryone in America gets a Dr. Pepper (sort of)

No Artist Approval + No Rules + Technical Problems = Pending Lawsuit

Rock the VoteStarbucks and Krispy Kreme face penalties for election day giveaways

Federal Statute prohibits any organization from “providing rewards for voting.”

Pepsi StuffedHarrier Jet a steal at 700,000,000 points

Student sues over deceptive advertising & business practices after acquiring enough points to purchase Jet.

Result: Out of court settlement and a whole lot of bad PR.

Promotions 3.0What’s next for advertising & promotions?

More Channels. More Noise

New channels & products will continueto distract consumers & clutter the landscape

Clutter ContinuesBrands will look for new ways to engage consumers

as media & product proliferation expands

Mobile DominatesMobile & Wireless devices will become the next

dominant consumer platform

65 Million U.S. Mobile Internet users in 2008 and growing*

* Promotion Marketing Association Digital Summit

Social Media ExpandsSocial Media is bigger than you think... and it’s just getting started

U.S. Social Network Usage

All Adults 35%Adults 18-24 75%

* Pew Internet & American Life Project, December 2008

Legal Issues Continue Privacy & Legal issues will continue to

create new challenges for marketers

+David Griffith is managing director of teamDigital, a brand based digital agency specializing in technology driven promotions that engage consumers, create loyalty, and increase brand value.

Blogwww.Promotions2.com

Websitewww.teamDigital.com