/531_kern_wp_2011_marketing_trends_0911 by Interbrand

JANUARY FEBRUARY MARCH APRIL MAY JUNE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER 2011 MID-YEAR MARKETING TRENDS STUDY

www.thekernorg.com

TABLE OF CONTENTS THE KERN ORGANIZATION’S 2011 MID-YEAR MARKETING TRENDS STUDY RESULTS 1. INTRODUCTION………………………………………………..………………………..……………..………….…… 3 4 2. EXECUTIVE SUMMARY………………………………………………..………………………..……………..………….…… 5 3. THE RESULTS………………………………………………..………………………..……………..………….………..…… 20 4. COMMENTARY………………………………………………..………………………..……………..………….………..…………… 22 5. ABOUT THE KERN ORGANIZATION………………………………………………..………………………..……………..………… 6. FOOTNOTES………………………………………………..………………………..……………..………….………..… 23

INTRODUCTION Transform or be transformed. Adapt or become obsolete. Evolve or perish. Innovate or be replaced. Marke1ng turbulence is the new normal of constant change, and top marketers are, at best, struggling to keep up with new technologies and learning to react to new behaviors. Tradi1onal marketers plan to modify, adapt or augment their core competencies and capabili1es in this digital age. Technology has touched every facet of marke1ng, and enabling technology solu1ons has become essen1al. Behavior has affected marke1ng as organiza1ons scramble to understand and become involved with social media. Integra1on has transcended buzz-‐term status and has become the rally call of organiza1ons and agencies. Offline, Online, Digital, Video and Social have morphed into Integrated Marke1ng for both programs and campaigns, causing marketers to be all in or find themselves out in the cold. The most interes1ng dynamic of the current state of marke1ng, is the growing return to marke1ng normalcy from the 2008 recession, while simultaneously experiencing the rapid advance of marke1ng technologies. The juxtaposi1on of these dynamics has created a marke1ng environment that must maximize return on investment with cau1ous eyes on budget, while causing further marke1ng spend on both technology and skilled staff. Just five short years ago, the marke1ng landscape was vastly different. The prolifera1on of social media, mobile marke1ng, content strategy, marke1ng automa1on, digital media, rich media, video, Customer Rela1onship Management (CRM) so[ware, coupled with technological advances has impacted the strategies and disciplines of tradi1onal marke1ng. Marke1ng challenges include dealing with the economy as it s1ll recovers and new customer behavior pa\erns (as the educated consumer has escalated into the extremely educated consumer). Whether marke1ng to consumers or businesses, marke1ng professionals have had to at least keep pace, or have tried to stay ahead of the curve, neither of which has been easy. Marketers, who are trying to balance the need to be informed of all that is new with maintaining current marke1ng campaigns or programs, are having trouble priori1zing a\en1on and focus. Issues such as the need for integrated mul1-‐channeled strategies, digital, social, mobile, search, alignment of sales and marke1ng, and transparent and accountable analy1cal repor1ng are top of mind for most marke1ng organiza1ons. Marke1ng departments are seeking new staff with skill sets such as content strategy, social media, digital and marke1ng automa1on over those with tradi1onal marke1ng skills. Campaigns can no longer be contained within silos, as a much more holis1c overarching strategy must be constructed across ver1cals and channels, with innova1ve breakthrough crea1ve playing a cri1cal role, in order to engineer effec1ve and efficient integrated marke1ng ini1a1ves. Dealing with the new normal of constant change requires expedi1ous ac1on and reac1on, as organiza1ons must be prepared to address the growing complexity of the ever-‐changing marke1ng landscape.

EXECUTIVE SUMMARY Recovery from the recession of 2008 is certainly s1ll underway. While marke1ng budgets have reappeared, those budgets are lean and are a\ached to stringent ROI expecta1ons. Analy1cs must be in place as those doling out the budgets must have reliable accountable means of qualifying expenditures and investments. Visibility is not only required, it is essen1al. Random tac1cal execu1ons of marke1ng ini1a1ves are passé and have been replaced with integrated mul1-‐channel innova1ve strategic programs designed for the new educated consumer. Customer acquisi1on, reten1on and cross-‐selling are s1ll the preferred items du jour, as marke1ng automa1on has rapidly gained acceptance and, while it is more prevalent in B2B marke1ng, marke1ng automa1on for B2C is being successfully u1lized by several organiza1ons. Social, Digital, Interac1ve and Marke1ng Automa1on are s1ll the shiny new objects in the marketer’s toolbox, although strategies that include all in an integrated manner are the preferred method of engaging these disciplines. Marke1ng organiza1ons overwhelming report that be\er integra1on of online and oﬄine data collec1on and analy1cs is vital to success. Organiza1ons that use agencies are sa1sﬁed with their agency’s crea1vity, innova1on, execu1on and results. Our Marke1ng Trends Study reveals many interes1ng pa\erns and trends across marke1ng organiza1ons, regardless of size.

2011 Mid-Year Marketing Trends Key Highlights •  90% say be\er integra1on of online and offline data collec1on and analy1cs is essen1al. •  84% indicate that aligning sales and marke1ng is important. •  53% are somewhat ready to deal with the new normal of constant change. •  48% are now using some form of Marke1ng Automa1on. •  43% allocate 25% of their total marke1ng spend to external agencies. •  37% spend 75% of their budget on acquisi1on and 25% of their budget on reten1on/cross-‐sell. •  37% feel that Facebook is the most important social media channel. •  34% have no Mobile Marke1ng strategy or plans in place. •  27% concentrate on Mobile Web for Mobile Marke1ng. •  16% are sa1sfied with their current social media marke1ng efforts.

THE RESULTS

The Kern Organiza1on’s 2011 Mid-‐Year Marke1ng Trends Study was conducted in July 2011, with 376 top marke1ng execu1ves (CMOs, VPs and Directors) responding from various industries. The annual sales revenue for companies responding conﬁrms a varied sampling with 44% from companies below $100 million per year and 56% from companies whose annual revenue exceeded $100 million per year. The ﬁrmographic data revealed that 44% came from organiza1ons with annual sales revenue less than $100 million, and 30% came from organiza1ons whose annual sales revenues exceeded $1 billion, with 9% at $500 million to $1 billion and 16% at $100 million to $500 million. Firmographic Data -‐ Annual Revenue 50 45 40 35 30 25 20 15 10 5

Respondents who are marke1ng to businesses and to consumers were mixed, with 43% engaged in B2B marke1ng and 44% engaged in a mix of B2B and B2C marke1ng, with 12% marke1ng strictly to consumers. B2B/B2C Breakdown

B2B 75%/B2C 25% 18% B2B 100% 44%

B2B 50%/B2C 50% 11%

B2B 25%/B2C 75% 15% B2C 100% 12%

Response by Title

A majority (68%) of respondents hold the posi1on of Director, while 15% are Vice Presidents, and 17% are CMOs or CXOs. Response By Title

Vice President/Sr. VP 15%

CMO/CXO 17%

Directors 68%

Top Three 2011 Mid-Year Marketing Challenges Revealed #1-‐ Acquiring a large number of new customers. #2-‐ Increasing retenAon rates and revenues from current customers. #3-‐ Increasing the quality and quanAty of leads for ﬁeld sales forces.

Other Top 2011 Mid-Year Marketing Challenges

#4-‐ Improving Marke1ng Return on Investment (MROI). #5-‐ Iden1fying marke1ng innova1ons to be\er engage prospects and customers. #6-‐ Using data and analy1cs to improve decision marke1ng and investment returns. #7-‐ Missing cri1cal ﬁnancial marke1ng metrics (cost per acquisi1on, cost per lead, ROI).

It’s always about acquiring new customers and retaining current customers while op1mizing their revenue. The trend revealed regarding customer acquisi1on as the top challenge for marketers is a welcome trend by marketers and organiza1ons. This trend is an indica1on of a return to marke1ng normalcy. During the past few years following the recession, marketers have been tasked with retaining customers and increasing revenue from current customers, without being handed a budget to acquire new customers (which was deemed “too expensive” during 1mes of extreme belt 1ghtening).

Marketing Turbulence–Being Prepared to Deal with the New Normal of Constant Change When asked how ready their organiza1ons are prepared to deal with market turbulence, about half of the respondents indicated that they are “somewhat ready to react.” Only 21% believe that their organiza1ons are in a posi1on to “react immediately,” while 12% feel that their “methodologies and procedures are too complex” to allow them to react quickly. Just over 5% felt the need to ask us to throw them a life preserver.

Marketing Turbulence 60

During this research project, Google launched Google+, once again causing marketers to place focus on both a new technology and a new social channel. This is a poignant example of the new normal of constant change. The announcement that company pages will soon be available on Google+ has again caused marketers to consider ways to capitalize, mone1ze, strategize and generally deal with a whole new channel. Most marke1ng eyes are watching closely as Google+ has launched strongly out of the gate and con1nues to gain trac1on. As technology evolves at a perpetually faster pace in 2012 and beyond, marke1ng organiza1ons must learn to adopt, adapt, act and react to the next big new thing, preparing to put in place strategies and processes at an accelerated rate, and that ability to move quickly and correctly will deﬁne the marke1ng age in which the new normal is constant change.

Acquisition, Retention and Cross-Sell What percentage of marke1ng investments are focused on customer acquisi1on, customer reten1on and cross-‐selling customers? Although Customer Acquisi1on was the #1 challenge reported by this group, regarding their budgets, marketers were evenly split with over 70% of the total focused on both customer acquisi1on and customer reten1on/cross-‐sell. Of course, awareness and branding sit under the reten1on umbrella, as organiza1ons’ marke1ng ini1a1ves must be a\en1ve to acquiring new customers, while retaining and cross-‐selling current customers. This dual focus requires marketers to segment their eﬀorts, leading back to the holis1c approach enabled by integrated campaigns.

Marketing Automation Use 60

Marketing Automation Recently considered a cusng-‐edge technology, marke1ng automa1on has gained wide acceptance in both organiza1ons and agencies. Very recently, less than 10% were using or had agencies that u1lized marke1ng automa1on technology, and our study reveals that this has changed dras1cally with an incredible 48% now using marke1ng automa1on on their own, or through their agency’s marke1ng automa1on program or platorm. When adop1on reaches this level, history dictates that it won’t be long before that 50% adop1on rate jumps to 80% then to 90%. If you’re not using marke1ng automa1on, the trend that is revealed here indicates that you may want to start shopping for a marke1ng automa1on platorm sooner than later.

Acquisition vs. Retention/Cross-‐Sell 40

Alignment of Sales and Marketing The age-‐old love-‐hate rela1onship between sales and marke1ng is headed more toward love than hate. Organiza1ons have realized the obvious, which is that sales and marke1ng ul1mately have the exact same goal. Some1mes the journey is envisioned diﬀerently by each department; however, when working in tandem, sales and marke1ng can achieve results otherwise una\ainable.

Sales and Marketing Alignment 70

A deﬁni1ve 84% believe that Sales and Marke1ng alignment is important. Of those, a strong 63.5% believe that alignment is very important, with only 11% admisng it to be somewhat important. A thin 3% indicate that it is not important at all. Sales and Marke1ng have a symbio1c rela1onship, and marketers are on board with aligning sales and marke1ng.

Data Analytics In order to improve marke1ng investment decisions, marketers agree that be\er integra1on of online and offline data collec1on and analy1cs is very important. The current trend is visibility and accountability in all facets of marke1ng, and data collec1on is no excep1on. In order to make intelligent, qualified and quan1fiable decisions, both online and offline data collec1on and analy1cs is absolutely necessary. Research from this study indicates that only a very small percentage (9%) feel that this ac1vity is not important. Data Analytics 40

Marketing Desired Skill Sets When considering new members of your marke1ng team, which skill sets are most important to you? Tradi1onal marke1ng skill sets are s1ll the most important to marketers, however, content strategy ran a very close second in this poll, trailing tradi1onal skills by mere percentage points.

Marketing Skill Sets Needed 30

The extremely close results to the importance of all of these skill sets reveal a trend that shows marke1ng organiza1ons are in need of specialized staffing. Tradi1onal skills received 25.3% as the most important, Content Strategy followed closely with 23.7%, Social Media skills were next at 19.3%, Demand Crea1on skills at 19% and, finally, Marke1ng Automa1on skills at 12.5%. Marke1ng organiza1ons are restructuring, reshaping and realigning staff to be prepared to cope with the integrated nature of marke1ng in the future.

Social Media Marketing S1ll under the microscope of marke1ng professionals is the discipline of social media marke1ng, with similar confusion as to how to harness the channel in support of marke1ng programs. Social Media Marke1ng sa1sfac1on among marketers is extremely low at 16.5%. Social Media Marketing Satisfaction 45 40 35 30 25 20 15 10 5 0

When breaking down the responses into only two categories, sa1sfied and not sa1sfied, 77% are not sa1sfied and only 33% have some level of sa1sfac1on with their social media efforts. Integra1ng social media strategies into marke1ng opera1ons wasn’t as cri1cal for marketers, with only 6% deeming it a very important ac1vity. While 32% believe that it is important to integrate social media into marke1ng, the overwhelming majority–61%– don’t believe that social media marke1ng integra1on into marke1ng opera1ons is important.

Social Media Integration into Marketing Operations 70

Social Media Spend

When asked “what por1on of your marke1ng investment will be allocated to social media in the coming year?” more than 85% answered between 0% and 25%, indica1ng that social media spend is s1ll in the experimental stages for most organiza1ons. Social Media Spend 100 90 80 70

60 50 40 30 20 10 0

14% of respondents, which is a larger percentage than an1cipated, answered that they intend to spend 26% to 50% of their total marke1ng budget on social media. A slim 3% are taking the full plunge into social media, expec1ng to spend 51% to 75% of their budget on this channel.

Social Media Channels

Facebook What is the social media channel of choice for marketers? That may depend on whether the marketer is a B2B or B2C marketer; however, the results overwhelmingly show that Facebook is s1ll the channel most marketers are paying a\en1on to. Perhaps it’s the 750 million users, of which 375 million log onto Facebook on any given day, or maybe it’s the 700 billion minutes per month that people spend on Facebook sharing over 30 billion pieces of content each of those months1, or Facebook’s yet-‐to-‐be-‐measured targeted adver1sing capabili1es.

Facebook 40

The average Facebook user has 130 Facebook friends and is connected to 80 community pages, groups and events. Facebook is a vast fron1er for marketers, allowing for speciﬁcally tailored customer experience applica1ons for Facebook, and with the advent of transac1onal Facebook storefronts, online commerce via Facebook will gain trac1on.

Twi,er

Placing second, Twi\er is perhaps the most misunderstood social channel. While most s1ll believe that Twi\er is used to alert friends or followers of mundane errands or happenstances of the Tweeter, enlightened social media marketers realize that Twi\er is an important real-‐1me engagement channel. Our study revealed that marketers believe this to be true, giving Twi\er the nod as number two. Twitter 35

Twi\er has eclipsed the 100 million user mark, adding a ●●● staggering 300,000 new users per day. What most do not realize about Twi\er is that it is increasingly being used Google: 88 billion per month for search, for those wan1ng a real-‐1me snapshot of their search term. Twi\er’s search engine receives more than Twitter: 19 billion per month 600 million queries per day. A recent ar1cle on SearchEngineLand.com detailed the search query totals Yahoo!: 9.4 billion per month for a single month.2 Twi\er has surpassed both Yahoo! and Bing by more than Bing: 4.1 billion per month double the search queries per month. Twi\er searches are o[en associated with a Twi\er Hash Tag (#), which ●●● narrows the search and enables Twi\er users to tag their tweets for easy and speciﬁc search returns. Twi\er also allows for shortened URLs to be included as part of a tweet, driving traﬃc to websites or landing pages. The use of Twi\er as a Demand Crea1on vehicle has increased and will con1nue to increase. LinkedIn

Now repor1ng 119 million members, LinkedIn was the third most important social channel to marketers. Fi[y million LinkedIn members reside in the United States. LinkedIn is a valuable resource for B2B marketers. LinkedIn membership increased over 17% from January to July of 2011.3

LinkedIn 25

With a variety of ways to market to businesses, LinkedIn offers banner ads that are laser targeted to firmographic data models, allows for discussions within many relevant groups that business leaders frequent, enables users to ask or answer ques1ons as experts, and offers company pages with specific product and services tabs, enabling branding and awareness.

Company Blog

The company blog is the fourth most important social channel for marketers. A[er all, the company blog is the hub of social media ac1vi1es, where links to blog ar1cles are promoted via social channels. Branding, Awareness and Customer Experience are the marke1ng beneﬁts of publishing an interes1ng and current blog site. Company Blog 25

Thought leadership, industry exper1se, knowledge leadership and strategic thinking are all on display within the content of the company blog. Ar1cles that resonate with the reader base perpetuate readership. Search Engine Op1miza1on can be bolstered with relevant key word placement within the blog ar1cles. Marketers have realized these beneﬁts, as evidenced by the recent prolifera1on of blog content in general.

YouTube

As of April 2011, the amount of users of YouTube reached 490 million, who spend 2.9 billion hours per month watching videos...which equals 325,000 years. YouTube is the third most visited website in the world. Over 48 hours of video is uploaded to YouTube every minute, which works out to 69,000 hours of video uploaded per day. Our research shows YouTube as the fourth social channel that marketers feel is most important.4 YouTube 25

As a search engine, YouTube is responsible for almost 28% of Google’s total search, which is approximately 24 billion searches per month. Consider that combining Twi\er, Yahoo and Bing monthly searches, YouTube has 75% of that combined total per month. In addi1on, SEO is greatly enhanced by a prolifera1on of YouTube videos that link back to a website. The Kern Organiza1on’s 2011 Mid-‐Year Marke1ng Trends Study © 2011 The Kern Organiza1on, All Rights Reserved. Page 14

Mobile Marke<ng Over 70% of the world’s popula1on now has a mobile phone. Children are more likely to own a mobile phone than a book. In the United States, nine out of every 10 people—men, women and children—have a mobile phone. Apple has sold close to 60 million iPhones. 160,000 new Android smart phones are ac1vated every day, and the platorm is growing by 886% per year. The market just for applica1ons for smart phones is expected to grow to $29 billion per year by 2013. In the next ﬁve years, more people will be connected to the Internet via mobile phones than personal computers.5 Mobile Marketing 40

With growth in mobile reaching stratospheric heights, the surprising results of our study showed that marketers and organiza1ons are slow to adopt. A shocking 33.7% of respondents have no mobile marke1ng strategy, tac1cs or budget for the next 12 months. Of those who are paying close a\en1on to mobile marke1ng, 27% feel that the mobile web is the most important mobile marke1ng solu1on. 21% opted for mobile content delivery, while only 9% are geotarge1ng mobile messages. Mobile marke1ng is not limited to these par1cular categories, as the lines between social and mobile have blurred. There are more than 250 million users on Facebook that access the channel through mobile. People who use mobile for Facebook are twice as ac1ve on Facebook as non-‐mobile users. The YouTube viewership of 490 million does not include those that are watching the channel on mobile devices. Twi\er and LinkedIn also enjoy large mobile audiences, all of which access these networks via applica1ons on mobile devices. Marke1ng organiza1ons will become heavily involved with mobile marke1ng; the ques1on now is, when will adop1on reach a signiﬁcant satura1on point? External Marke<ng Agency Trends Almost 80% of respondents currently use an external marke1ng agency, although those engaging with agencies predominantly spend less than 25% of their budget with agencies. Those organiza1ons that manage all marke1ng budgets in-‐house accounted for 21.8% of respondents. The balance use agencies in varied degrees of engagement. 43.5% spend 25% of their total budget with agencies. 21.5% spend 50% of their total budget with agencies. 10.6% hand over 75% of their marke1ng budget, while only 2% use agencies for 100% of the marke1ng spend.

Agency Marketing Spend 50 45 40 35 30 25 20 15 10

5 0

The use of agencies is widespread among respondents, indica1ng that agency usage increases ROI across various marke1ng ac1vi1es. Agency usage is also obviously dependent upon the organiza1on’s marke1ng structure and staffing. Many organiza1ons don’t have adequate staff to run en1re campaigns or programs, and they u1lize agencies to compensate for their staffing limita1ons. Upon diving deeper into the data, those organiza1ons that currently use a marke1ng automa1on platorm independently of their agency account for 34% of the total, which translates into marke1ng-‐automa1on-‐enabled organiza1ons using agencies to enhance efforts through agency-‐developed strategies, crea1ve, content development, lead nurturing and other components of demand crea1on.

Agency Activities 70

The marke1ng ac1vi1es that agencies are primarily engaged for include Branding/Adver1sing (58.7%), Website Development (47.6%) and Digital Marke1ng (47.6%). Media Planning/Buying (37.5%) and Mul1media/Video (33.5%) were fourth and ﬁ[h. Rounding out the ﬁeld were Public Rela1ons (31.6%), Content Strategy (28.4%), Social Media (23.9%) and Demand Crea1on (20.2%), with Sales Enablement and Channel Programs and Support 1ed for last with 10.1% each.

Demand Creation Agency Engagement While 21% do not use external agencies, those that do rely on agencies for many of the components of Demand Crea1on campaigns.

Organiza1ons are u1lizing marke1ng agencies for a variety of Demand Crea1on components, fairly evenly split among the components. Strategy, which includes targe1ng/segmen1ng, market opportuni1es and best prac1ces, accounts for 20% of the split. Content and Collateral development, which includes video and mul1media produc1on, white papers and adver1sing crea1ve, also accounted for 20%. Lead Genera1on, List Building and Database Marke1ng, and Technology ,which includes Marke1ng Automa1on, are within one percentage point of each other at 16%, 15% and 14%, respec1vely.

Agency Satisfaction Ratings How sa1sfied are organiza1ons with the performance of their marke1ng agencies? Our study asked three different ques1ons regarding this topic, and the data reveals that while most organiza1ons are sa1sfied or somewhat sa1sfied with their agency, an alarming number of respondents showed dissa1sfac1on.

Agency Creativity/Innovation Satisfaction When queried as to how sa1sfied they were with their current agency’s crea1vity, innova1on and concepts, 61.3% were Highly Sa1sfied, Very Sa1sfied or just Sa1sfied. 38.7% were either Somewhat Sa1sfied or Not Sa1sfied. Of course, judging both crea1vity and innova1on are highly subjec1ve assessments, and when repor1ng and analyzing this data, we must take that subjec1vity into account. The breakdown on this ques1on had 7.1% Highly Sa1sfied, 17.5% Very Sa1sfied, 36.7% Sa1sfied, 23.2% Somewhat Sa1sfied and 12% Not Sa1sfied.

Agency Creativity Satisfaction

35 30

25 20 15 10 5

Agency Execution of Projects Satisfaction 40

Agency Execution of Projects Satisfaction

35 30

25 20 15 10 5

The results of the ques1on “How sa1sﬁed are you with your current external agency’s execu1on of projects?” were nearly iden1cal to the previous sa1sfac1on ques1on regarding the agency’s crea1vity and innova1on.

Agency Results Satisfaction How sa1sfied are you with your agency’s results? The most important and relevant ques1on of this series yielded a slightly different result than the previous two ques1ons regarding agency sa1sfac1on. Where 7% were Highly Sa1sfied with their agency’s crea1vity and innova1on, and 9% were Highly Sa1sfied with their agency’s execu1on, only 5.5% were Highly Sa1sfied with their agency’s results. For those who answered Very Sa1sfied, only 15.4% were Very Sa1sfied with their agency’s results, whereas the percentage of Very Sa1sfied on agency execu1on was 18%, and the same category scored 17.5% on being Very Sa1sfied with Agency crea1vity and innova1on. 45

Agency Results Satisfaction

40 35 30 25 20 15 10 5

Mysteriously, 39% were Sa1sfied with their agency results, while only 37% were Sa1sfied with their agency’s execu1on, and 36% were Sa1sfied with their agency’s crea1vity and innova1on. Regarding those who were Not Sa1sfied with their agency’s results, 13% was a significant raise in percentage from those who were Not Sa1sfied with their agency’s crea1vity and innova1on, from 9.3%. Not Sa1sfied with their agency’s execu1on weighed in at 12%.

COMMENTARY What an exci1ng 1me to be a marketer! Never before in history has there been a combina1on of technology, social realignment, behavioral changes and a variety of channels converging at once, causing marke1ng organiza1ons to really consider how, in fact, they are prepared to deal with the new normal of constant change. Sure, marketers historically have had to deal with new technologies, as the prin1ng press, mail, radio, television and the Internet acted as the catalysts of new marke1ng strategies and processes at their 1mes in history; however, never before have marketers had to deal with so much at once. When technology dictates changes in human behavior, marketers quickly sit up and take no1ce. Smartphones, laptops and now tablets have radically changed behavioral tendencies, as people now have adapted behavior to facilitate use of their new technological devices. Millennials, who have been brought up with these devices, listen in horror to stories from “old-‐1mers” who had to make it through most of their lives without a mobile device, the Internet or GPS. The Kern Organiza1on’s 2011 Mid-‐Year Marke1ng Trends Study Research has enabled us to “put our finger on the pulse” of marketers across a wide variety of organiza1ons from small companies to enterprise corpora1ons. The welcome return of Customer Acquisi1on as the top marke1ng challenge indicates a return to marke1ng normalcy. During the past few years, organiza1ons were mandated to focus on customer reten1on, branding and awareness as the primary marke1ng objec1ves. Marke1ng Automa1on’s accelerated adop1on was a surprising finding, with 48% repor1ng that Marke1ng Automa1on is implemented by their agencies or directly by the organiza1ons. This can be hypothesized as a reac1on to the need for accountable data analy1cs, which Marke1ng Automa1on facilitates. All roads lead to data. As complexity in marke1ng increases rapidly, a mega-‐avalanche of data is created through both marke1ng automa1on and other online and offline marke1ng and sales ac1vi1es. The collec1on, aggrega1on, analysis and facilita1on of prac1cal usage of data requires technological and human resources. Data analysis plays an integral role in providing the transparency and visibility essen1al to accountability to budget and to demonstrate the beneficial results of marke1ng ini1a1ves. Sales and Marke1ng Alignment, the quintessen1al quest for all organiza1ons, is important to marketers, as it should be. There have been numerous successful case studies regarding the collabora1on of sales and marke1ng departments, some of which have gone to the extreme of having signed service agreements as a contract between sales and marke1ng. Although this concept of alignment is anything but new, the acceptance of the idea is more prevalent than in previous studies. Organiza1ons are seeking new staff with decidedly different skill sets than in past years. While the majority of respondents did answer that they would be seeking staff with tradi1onal marke1ng skill sets, considera1on of the bigger picture reveals that the combined other skill sets totaled 75% of the answer. This data strongly indicates a desire to add Content Strategists, Social Media Specialists, Demand Crea1on Specialists and Marke1ng Automa1on Specialists over those with tradi1onal marke1ng skills. The Kern Organiza1on’s 2011 Mid-‐Year Marke1ng Trends Study © 2011 The Kern Organiza1on, All Rights Reserved. Page 20

COMMENTARY

(cont.)

Social Media Marke1ng has evolved in its short life1me, sprou1ng new areas of exper1se, such as Social Media Listening, Social Audience Marke1ng and Social Opera1ons, just to name a few. Our study on social media touched on several areas, including social media spending es1mates and sa1sfac1on with social media efforts. The insight gained from this research shows that while organiza1ons are s1ll considering social media marke1ng as experimental, the realiza1on of the importance of engaging these channels is causing organiza1ons to seek specialized staff. Social Media Marke1ng spend is s1ll very light, with most organiza1ons planning to spend 25% or less of their budget on social. The lack of sa1sfac1on of current social media marke1ng efforts indicates that improvement is needed. Mobile Marke1ng adop1on is surprisingly low, where the vast majority of respondents (34%) have no plans or strategies in place. Mobile Web is more important than crea1ng mobile applica1ons to marketers, as mobile geo targe1ng and marke1ng via SMS text messaging are barely a blip on most marke1ng organiza1ons’ radar. We an1cipate an escala1on of a\en1on from marke1ng organiza1ons regarding all facets of mobile marke1ng in the near future. Marke1ng Agency usage is prevalent, as 80% of organiza1ons are engaging marke1ng agencies with 25% or more of their en1re marke1ng budget. Agencies provide a variety of marke1ng ac1vi1es to organiza1ons, with the top supplied agency ac1vi1es being: Branding/Adver1sing, Website Development and Digital Marke1ng. Agency involvement with Demand Crea1on for organiza1ons involves all components of the discipline, with concentra1ons on Strategy, Content Development, Lead Genera1on and Database marke1ng. While organiza1ons are generally sa1sfied with the overall performance of their agencies, less were Very Sa1sfied or Highly Sa1sfied with their agencies, specifically in the area of Agency Results Sa1sfac1on. Analy1cs are top of mind for marketers, regarding assessment of programs or campaigns, projec1ons for future budgets or campaigns, tes1ng and providing the transparency and visibility that is essen1al for today’s marke1ng organiza1ons. We would like to offer special thanks to those who contributed to this important research project. Your par1cipa1on enabled us to present these insights and examine these trends regarding the current state of marke1ng in 2011. As business, technology and human behavior evolve, so must marke1ng organiza1ons. There have been some periods in the history of marke1ng where being stagnant has been a posi1ve a\ribute, building branding with consistent, predictable marke1ng ac1vi1es. That is a bygone era, never to be revisited. Contemporary marke1ng organiza1ons must be ready to deal with, and ul1mately embrace, marke1ng turbulence. How prepared is your organiza1on to deal with the new normal of constant change?

ABOUT THE KERN ORGANIZATION For clients who are unwilling to accept trade-‐offs, The Kern Organiza1on, an Omnicom Agency, is the ideal Integrated Marke1ng partner. Sophis1cated, efficient and energe1c, we have a long history of crea1ng and implemen1ng campaigns that produce results immediately and do so within the context of the brand. As a turnkey supplier of crea1ve marke1ng solu1ons, we get our clients to market quickly—slashing cost-‐per-‐ sale, building large sales pipelines in record 1me and pleasantly surprising marke1ng execu1ves who previously had to se\le for lower levels of results. We achieve all of this through a carefully calibrated combina1on of advanced data management, sophis1cated strategic planning, and innova1ve crea1ve and technological solu1ons. B2B and B2C marketers in Technology, Financial Services, Home Entertainment and Medical/Health Care can select from an array of online and offline crea1ve services combined with sophis1cated web-‐enabled database and e-‐marke1ng technologies, as well as comprehensive campaign result monitoring and analy1cs. The Kern Organiza1on, an Omnicom Agency 20955 Warner Center Lane, Woodland Hills, California 91367 h\p://www.thekernorg.com (818) 703-‐8775

FOOTNOTES

1.  Facebook Sta1s1cs (www.facebook.com) 2.  SearchEngineLand.com (h\p://searchengineland.com/twi\er-‐does-‐19-‐billion-‐searches-‐per-‐month-‐ 39988) 3.  Digital Buzz Blog.com (h\p://www.digitalbuzzblog.com/linkedin-‐demographics-‐sta1s1cs-‐stats-‐2011/ 4.  SearchEngineWatch.com (h\p://searchenginewatch.com/ar1cle/2073962/New-‐YouTube-‐Sta1s1cs-‐48-‐ Hours-‐of-‐Video-‐Uploaded-‐Per-‐Minute-‐3-‐Billion-‐Views-‐Per-‐Day) 5.  Digital Buzz Blog.com (h\p://www.digitalbuzzblog.com/mobile-‐sta1s1cs-‐2011-‐growth-‐of-‐mobile/)