Creating Relationships:

Recognizing the Value of

Database MarketingMichael Stich,

Group Director, Strategic Planning

Currently provides interactive planning to clients. Focus

areas: e-commerce, digital retail, analytics/measurement,

mobile, social media, and relationship marketing.

Published author and featured speaker: E-commerce, the

Digital Home, Home Networking, the Future of Broadband,

The Asian Internet

Technology and Telecom Strategy / Marketing background

(Dell, McKinsey, TI)

B.S. in Computer Engineering from Tufts University and an

M.B.A. with Marketing focus from the MIT Sloan School of

Management.

Michael Stich – Group Director, Strategic Planning,

Bridge Worldwide

Bridge Worldwide - Key Facts

Staff 290 Digital Professionals

Founded 1979

Awards

Services Strategic Planning, User Experience Planning, Visual Design, Technical Development, Social Marketing, SEO, CRM, Emerging Platforms, Account/Project Management

Culture Top 25 Small Companies to work 4 years running2006, 2007, 2008 & 2009

Cincinnati (HQ)302 West Third StreetSuite 900Cincinnati, OH 45202Main: 513.381.1380

New York498 Seventh AvenueNew York, NY 10018Main: 917.224.9573

Bridge Worldwide – Our Difference

Database Marketing:

Why Bother?

Consumers have unprecedented choice and control

What I want,

When I want it,

Where I want it,

In the forms I want,

As much or as little,

Filtered by my peers,

Backed by expert opinion,

Without unwanted interruption,

And then I’ll share it with my “friends,”

But don’t you dare tell a soul you know me.

Result: Marketers expected to respond –

using data and personalization

• Clients increasing their analytics

resources across marketing and IT

• Data quality control growing more

important

• Resulting Winners: those who know

and focus on data reliability

• Resulting Losers: those who fail in-

market measurement validation

Database Marketing:

The Basics

What Is Database Marketing?

Database marketing is a form of direct marketing using databases of consumers or potential consumers to generate personalized communications to promote a product or service for marketing purposes. Database marketing emphasizes the use of statistical techniques to develop models of customer behavior, which are then used to select consumers for communications.

But the opportunity is much greater…

Create an ongoing, 1:1 relationship with a

large, diverse population

Single ChannelMultichannel

Number of

Communication

Channels

Mass Awareness

Trial, Loyalty, Consumer Care,

Increased Usage, Cross-Sell,

Line Extensions

Marketing

Objectives

LowHighPotential for Brand

Engagement

Single Brand PromotionMultibrand/Scale PromotionExample

LowHigh% Online

Small, HomogeneousLarge, Heterogeneous

Consumer

Segment Size

and Diversity

When Not to

Build a Database

When to Build

a Database

Database

Marketing

is a way to create

a personalized,

ongoing

relationship with

a large, diverse

population.

Why Do It? To Create a Relationship

Best Practices

Database Quality (Over Quantity)

• 80 For 20 Rule Applies

• Budweiser: 1.2% of

buyers = $170/year

• Iams: 1% of buyers =

$93/year

Source: Catalina/CMO Council study of

1,300 brands

Brand Collaboration (1+1=3)

Segmentation and Targeting: Potential Ways to Personalize

Behavioral• New/returning user

• Clicks

• Category affinity

• Purchases

• Visits

Time-based• Time of day

• Day of week

• Season

• Recency

• Frequency

Traffic source• Organic search

• PPC

• Email

• Direct

• Display / iMedia

• Affiliate

Environment• IP address

• Country / population

• OS / browser

• Screen resolution

Existing data• Analytics

• CRM

• Demographics

• Psychographics

Personalization Through Increased Segmentation

One Voice Across Touchpoints (By Segment)

Watch-Outs

Don’t Spam

Respect Consumer Privacy

Who’s Doing It Well?

Some Case Studies

Email Personalized by:

• Demographics

• Product codes

entered

• Rewards received

• Sweepstakes entered

• Website activity

• Time in program

As many as 7,000 unique

monthly email layouts

Research proves that

personalization drives

engagement.

And, engagement drives

sales.

Personalized Offers Drive Results

• +100k users in first month, +600k today

• Email open rate of 40%

- vs. 16% industry average

• 34% incremental volume

- People who did not use newspaper coupons

• Targeted emails result in 2x redemption

• Further builds the P&G Everyday Solutions

database

• Kroger enjoys higher share on new P&G items

Nike Is Shifting Its Entire Marketing Model

“We’re not in the business of keeping the media companies alive.

We’re in the business of connecting with consumers.”- Trevor Edwards, VP Global Brand Management

“If we can do something to benefit our consumers and

serve the needs of athletes to perform better, they will

return to our brand.”- Stefan Olander, Global Director for Brand Connections

“Nike+ has become an indispensible service, giving runners a

continued deep connection to our brand.”- Michael Tchao, General Manager for Nike Techlab

And Experiencing Strong Results

Successfully defending against Adidas/Reebok and Under Armour.

In its first six months, Nike+ helped drive an 8% increase in profit.

CEO Mark Parker promised to grow sales 50% in the next five years.

But it’s turning “mass” and “scale” on its head…But it’s turning “mass” and

“scale” on its head…

Emerging Trends in

Database Marketing

Consolidation Underway:

Islands Giving Way to Unified Views of the Customer

• Google + AdMob

• Omniture + Adobe

• Nielsen + facebook + Catalina

• comScore + Omniture

• New media-planning tools from

audience measurement firms

• Google measuring across

platforms…

Rebate

Sampling

Activity

Demographics,

Life Stage

Attitudes &

Interests

Syndicated

Data

Transactional

Data

Predictive

Models

Media

Habits

Promotional

History

Web Site

Activity

SOURCE: TARGETBASE

Benefits of a Unified View

Centralized, all-media view of the consumer

More robust consumer data, the trusted source for targeting

Action-driven system to enable 1:1 communications with consumer

Flexible, real-time, targeted offers/messages delivered at moment

of consideration

Easy access to data and reporting to help marketers make

informed decisions

Scalability without significant increases in cost or resources

Centralized data/list management for maximum cost-efficiency

Analytic “playground” to support testing, scale opportunity

identification, modeling & measurement

So Where Is This

Headed?

Unified Customer Intelligence Raises the Role of Analytics in Marketing

SOURCE: FORRESTER

Brand management will shift focus

TODAY TOMORROW

Hub and spoke Connected nodes

Command and control Listen and respond

Militaristic Cooperative

Mass messaging Two way dialog

Sales in the channel Sales everywhere and integrated

Regional Truly global

Trial and awareness Connection and retention

The value equation for database marketing

MEANING RELEVANCY VALUE

Connect with

consumers where

they are

When, where and

how they want to

connect with you

To move them

beyond consideration

to purchase and

advocacy

Database Marketing in 2020

• Simplified, natural, universal

access to unified data

• Data structures: from developer-

defined to user-defined

• Data values: from dynamic to

real-time

BUT:

• Increased automation =

increased volatility!

Summary

• Consumers Demanding Personalization, Marketers Have The Tools

• Data Can Be Used For Help OR Spam – Be Careful!

• Great Examples: Coke Rewards, P&G eSAVER, Nike +

• The future: More meaningful and relevant experiences, delivered by

more integrated, dynamic and automated database marketing

Thank You!

Michael StichGroup Director of Strategic Planning

Bridge Worldwide, a WPP interactive and relationship marketing agency, was named one of the Top 25 Places to Work in America

in 2006, 2007, 2008 & 2009 by the Great Place to Work Institute.

Bridge Worldwide

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