In their annual Industry Trends Report, PROMO Magazine cited nearly 70% of brand marketers will assign some portion of their 2005 budget to interactive promotions – a year-over-year increase of 24.4%.This year, eMarketer expects a 17% rise in online and interactive spending in the CPG industry, from $330 million in 2004 to $470 million in 2006.
The cash infusions prove what we already know or at least suspected: interactive marketing is successfully carrying out on its pledge. Marketers were quick to hone in on the benefits that drove the industry: efficiency, measurability, targeting capability, data collection, and most important, that interactive dynamic which brings brands one step closer to the consumer.
The role of promotion, historically played out as a below-the-line tactic for short term sales gain, has evolved as a key integrated marketing tactic, driving both short-term sales and helping meet longer term brand objectives. Now with interactive technology in the mix, marketers are cooking integrated campaigns that not only heat-up brands, but add depth to the consumer relationship.
“The companies that place emphasis on building longer term relationships rather than on individual transactions or brands, are the ones winning with interactive marketing,” says Joel Parent, director of interactive business development for promotion solution provider iC Group. “Look at any of the big CPG websites today and you’ll see the movement. You don’t just go to a website to download a coupon anymore. You go for the coupon, to get a recipe, to learn about a product, to download music, to play a game, and so on. The traditional website model is shifting to become more engaging online destinations that entertain, engage and inform the consumer,” says Parent.
Taking it one step up the tech rung, marketers are now beyond test stages of the newest and smallest screens. With over half the American population using a cell phone and 90% of subscribers able to send and receive text messages, marketers are texting sweeps offers, coupons, invitations, ring tones and more – making for fun and fast interactive experiences.
“Marketers are reaching youth anytime, anywhere,” says Gary Schwartz, President of Impact Mobile, provider of mobile communication solutions. “The cell phone effectively complements print, broadcast, and mail media. We can target, measure and telescope off any push media – this is “offline interactive,” says Schwartz.
The new generation of consumer electronics is here (MP3 and WMA players, mobile video playing devices, media playing game machines), promoting the launch of third generation mobile services and innovations across traditional media such as TV (ADSL TV, mobile TV, HDTV). As a result, marketers and advertisers are plugging-in and wiring-up to the consumer – getting closer, more intimate, each time.
So as the web, cell phones, multi-media messaging and other emerging technologies firm-up roots in marketing strategy, the model of the consumer-brand relationship is taking a turn. Parent of iC Group says marketers need to be thinking about consumer behavior, not just brand, as they navigate through interactive lands bcape.
“Marketers needs to break out of brand silos,” says Parent. “It’s not just about the brand any more. It’s about how well marketers give consumers what they want, the overall consumer experience they create, not just product push and pull.”
eMarketer Senior Analyst and author of the new CPG Online Marketing report, Lisa Phillips, recently reported that CPG markets are leading the way in CRM marketing… spending huge amounts of money on CRM databases to keep customer information fresh and help hone their promotions and new products.
It’s a sign of the times and Parent says CRM needs to factor across all brand platforms.
“Typically, brand data is not standardized or easily merged to a central CRM database,” says Parent. “Methods of collection and storage may not be consistent, opt-ins (or outs) are not centralized, reporting features aren’t standardized and so forth. The optimal situation is a data management strategy across brands to optimize relationship marketing,” says Parent.
Where to start? For CPG markets with bigger budgets, it may mean engagement of a traditional CRM company. The danger in this strategy lies in CRM engagements being notoriously long and deep, and sometimes these are not fast enough to help nimble brand marketers who often want to change the rules on each and every program.
Strategic interactive promotional partners that “play well” with the CRM solution may be the better solution for many marketing groups, as these companies will choose to focus on a narrower version of what is classically viewed as CRM: just the promotionally active consumers. For the mid-size companies running interactive campaigns across fewer brands, the best option may be to internalize the CRM capability and develop the solution in-house.
Whatever the scenario, Parent says as marketers embark on tech worlds to create dialogue with consumers, CRM thinking must factor into interactive marketing planning. After all, why else do we collect data, but to benefit the brand and foster the consumer relationship?
It’s all about making the data work for you.
NEXT ISSUE: You decided interactive marketing is right for you, or you’re looking to asses your current interactive vendor, where do you start? Visit again for top 10 tips on choosing interactive vendors.
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