Ekonomika leuven

“Wat hebben de mensen toch tegen reclame, Wouter?”(gvds)

People don’t like ads (anymore) -‐ for various reasons. That’s why adver<sing works less and less. But many ad-‐people are s1ll in the denial phase.

1980-‐1990:Adver<sing +10% = +2.2% marketshare 2008:Adver<sing +20% = +2.2% marketshare

“ …. the authors conduct a meta-‐analysis of 751 short-‐term and 402 long-‐term direct-‐to-‐consumer brand adver1sing elas1ci1es es1mated in 56 studies published between 1960 and 2008. the study finds several new empirical generaliza1ons about adver1sing elas1city. the most important are as follows: the average short-‐term adver1sing elas1city is .12, which is substan1ally lower than the prior meta-‐analy1c mean of .22; there has been a decline in the adver1sing elas1city over 1me.”

Gerard Tellis, PhD Michigan, is Professor of Marke<ng, Management, and Organiza<on, Neely Chair of American Enterprise, and Director of the Center for Global Innova<on, at the USC Marshall School of Business. He is Dis<nguished Visitor of Marke<ng Research, Erasmus University, RoZerdam and has been Visi<ng Chair of Marke<ng, Strategy, and Innova<on at the Judge Business School, Cambridge University, UK. Tellis specializes in the areas of innova<on, adver<sing, global strategy, market entry, new product growth, promo<on, and pricing.

Prof. Dr. Gerard Tellis

Why the hell then is adver<sing (in the US) growing faster than BNP or the median salary?

Media rates set to increase by 14% in China in 2013. Media spending was expected to grow by 7% on an annual basis in 2013.

• Digital: +18% • Outdoor: +6% • TV: +5% • Radio: +5% • Newspapers: +3% • Magazines: +2%

Which brands will con<nue to pay that?

Less and less brands are willing to sponsor the media. Hence the growth of the recommenda<on phenomenon.

Recommenders directly influence 20-‐50% of all purchase decisions.

Offline! Thè method of recommenda<on.

‘Hoe meer ze over dat schandaal spreken, hoe meer paardenvlees we verkopen'

Offline beats online. Everywhere in the world. Look at the Chinese example.

The mo<ves of recommenders?

POE: Paid. Owned. Earned.

At the moment we move from impressions to expressions, ZO broadens brand experience to …the “good old impressions”.

Zenith Optimedia

Broadens “Experience” to “Impressions”: opportunities to be seen, heard .

“a sum total of the actions and scale in the market – and since large amounts of dollars still go behind mass media – the impressions (or experiences) from these tend to overwhelm the earned space.”

Holaba

“the brand experience that has real influence on other consumers has to be limited to the actual, physical experience with the product/brand itself. Older experiences and "hearsay experiences", or "nice advertising" only play very little role in influential WOM.

Our 2007 (!) research in China made clear that experience is more powerful that hearsay.

But here again friends&family recommenda<ons @ the top.

“… while consumer electronics buyers pay more aTen1on to other consumers’ reviews than to editorial reviews – by a margin of more than three to one (77 percent vs. 23 percent) – a majority are concerned about the authen1city of consumer reviews (80 percent), leading them to conduct considerable analysis before making their decision.”

Who’s influencing? Is all that buzzing trustworthy?

Recommenda<on measurement started with Reichheld in 2003

How do you measure your recommenda<on score? How do you iden<fy recommenders and detractors?

De éne vraag die nu door meer en meer bedrijven gesteld wordt. In dit geval op de site van Klout.

Where does this recommenda<on phenomenon come from? Why is it growing? Where can it lead us too?

Back to China and history.

“Gini = 0.61 for 2010” Southwestern University of Finance (Chengdu) in 2012

0.474 or 0.61? 0.469

It’s difficult to trust the Chinese numbers. Give it a try.

”Verdienen deze 10% “rijken” maar 7.000€ / jaar of … 15 à 16.000?”

For 2012, the na<onal G.D.P. figure is es<mated to be nearly 52 trillion renminbi (about $8.3 trillion,) while the provincial total was nearly 58 trillion (about $9.3 trillion.)

“Media exposes total G.D.P. of all provinces exceeds na<onal G.D.P. by over 5 trillion renminbi,” (the exact figure was 5.76 trillion,) a headline announced in the 21CN News.

The gap is getng bigger, fast: in 2009, total provincial G.D.P. was nearly 2.7 trillion more than na<onal G.D.P.; in 2010 it was more than 3 trillion; in 2011 it was 4.6 trillion, the Beijing News reported.

In a chain of exaggera<on that begins at the village or county level, the figures pile up un<l they overreach any possible na<onal total, the ar<cles indicate.

9% 9% 1%

10% 10% 10% 10% 10% 10% 10% 10% 10%

Weinig verdieners Veel verdieners

Minder dan 2€ per dag

Meer dan 40€ per dag

This is how the rich get richer. Nothing stops them.

http://online.wsj.com/article/SB10001424127887324906004578287182123200020.html?mod=djemITPA_t

Chinese trust their media. They at least cover the scandals.

hZp://www.slideshare.net/EdelmanInsights/global-‐deck-‐2013-‐edelman-‐trust-‐barometer-‐16086761

Chinese trust Big Companies. Small is not beau<ful. ”The winners take it all”.

Our own numbers from the daily deal industry prove the “magnet of Big”

Chinese (even)(s<ll) trust their banks. Haven’t they done anything wrong yet?

Banks in China (only in China?) are appreciated. Hence the trust

At the top of the Chinese brands: plenty of banks, insurances …

These Chinese topbrands are also top-‐users of social media.

hZp://www.resonancechina.com/2013/02/06/chinese-‐valuable-‐brands-‐more-‐present-‐in-‐social-‐media/

Don’t trust the topshots in these big ins<tutes.

Trust the ins<tutes and corpora<ons. Not their leaders.

I”ll search for it myself.

China: 46 minutes per day on social media. Japan: 7 min. VS: 37 min.

More social media is less <me

@ other sites …..

and changing communica<on-‐

behavior (Record 34,977 posts seen on Sina Weibo in

first second of lunar new year)

Chinese are not loyal. Not even to their social media.

In China recommenders influence more than wherever else in the world.

“Incredible” study from Insites.

Friends and family. They are the trusted source. Adver<sing …?

Chinese? They buy a lot online and tell it to a lot of people online too.

Who changes his mind when people argue online?

http://twitter.yfrog.com/f6rtqtj

Recommenders dominate “share of voice” and influence ”share of market”. How do we calculate that?

Clever marke<ng!

Why do you recommend? And why not?

Reviews do the job!

Evalua<ng Buying

Selec<ng brand

Consuming

15% are “influencing”

others

Selec<ng shop

85% are being

influenced

1st moment of truth 3rd moment of truth 2nd moment of truth

(Neutral) Promoter><Detractor Consumer

Moments of truth. All 3 are crucial.

Back to the Reichheld ques<on. And the Holaba-‐site in China.

88

8

NPS

Not only we ask clients whether they will/will not recommend a brand…

NPS

NPS

We ask non-‐clients too. They too judge, talk and influence. That’s why we ask them.

Your recommenda<on-‐score is “only” meaningful, when you know the score of your compe<tors.

You recommend what?

This is what the social consumer will buy …based on recommenda<on

Add recommenda<on scores in your tradi<onal RFM marcom-‐planning (recency, frequency, monetary value) and turn it into RRFM.

Recency, frequency, monetary value (RFM) of clients are decisive for investment in marke<ng communica<on. Therefore lots of money spent (wasted) in this group of heavy and recent buyers

RFM -‐ axis

Light and non frequent buyers are ozen “neglected”

From RFM to RRFM to decide about what to invest where.

RecommendaKon axis

+RFM & -‐ REC

-‐ RFM & -‐ REC

+RFM & + REC

-‐ RFM & + REC

RFM -‐ axis

The recommenda2on power of clients becomes the decisive tool to decide on marcom-‐investments

Does not mean they all give posi1ve recommenda1ons

Frequency and intensity of recommenda2on.

Use it also to analyze your retail performance: Shops with a high recommenda1on power sell beZer. Measure their recommenda1on power too.

hTp://wijs.be/nl/trends-‐inzichten/blog/detail/online-‐trendrapport-‐2013

From SoLoMo to SoLoReMo.

E-‐commerce.

Unstoppable….

Consumerprofiles will all of a sudden look completely different.

To influence these influencers, iden<fy them. Con<nuously. Everywhere.

“Instead of running ads, solve the shit”

? ? ? ?

1 “Uit onze gegevens blijkt dat u het toestel heei aangekocht op 14-‐07-‐2011 op naam van xxxx. Omdat dit een bedrijfsaankoop is (met BTW nummer) geldt hier slechts een garan1e van één jaar, het toestel valt dus momenteel buiten garan1e. Indien we het toestel omruilen buiten garan1e (voor hetzelfde toestel) dan zou de

repara1eprijs komen op ongeveer € 494.”

iPhone Repeat Purchase Inten<on Drops 13 points in Western Europe.

Likely to buy next iPhone from Apple?

•  88 % in 2011 •  75 % in 2012

1

Strategy Analy1cs Wireless Device Lab Report-‐ oct 2012

hTp://www.slideshare.net/dataotuan/the-‐mysterious-‐facebook-‐likes

2

The mysterious Facebook-‐likes? They spam.

“Als geste van goede wil en in de hoop uw vertrouwen in onze maatschappij enigszins te herstellen, wil ik u graag 5000 Flying Blue mijlen aanbieden.

De mijlen worden binnen enkele dagen bijgeschreven op uw Flying Blue rekening.”

J. Viel Customer Care Europe

26.10.2012

3

Overview: 50 responses received

1.

2.

hZp://surveyreport.com/

“

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Jan Van den Bergh 杨⽂文博

[email protected] hYps://www.facebook.com/jevedebe hYps://www.facebook.com/holaba TwiYer:@holaba Skype:jevedebechina

+86 136 2179 9450 (CH) +32 475 427 882 (BEL) A : 上海市新闸路831号丽都新贵13层F室, 200041 13－F, No 831 Xin Zha Road, Shanghai, 200041

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