“Twice the resultsfor half the budget”

The new marcom paradigm,

or not??

Show me the money!

Or is it…..

Topics

• Back to basics – where’s the money at?

• Quick & Dirty Research

• What are the trends?

Back to basics –fine-tuning the business rationale!

• Advertising increased 70% in decade• Total marketing budgets increased by 94%• Direct marketing investments increased more than 400%• $12.4 billion, or 7.2% of total direct marketing moved into

online search engine marketing• Increased emphasis on search, interactive and

response-based links to consumers, retail incentives, couponing, sampling, experiential marketing and other forms of marketing that are tied to sales department analytics

Share of Marketing Communications Budgets - 1998 Vs. 2008Marketing Category % Share

1998 2008Advertising 34.9 30.6Direct Marketing 10.1 22.8Sales Promotion, Events, PR 55.0 46.6

www.MyersReport.com

Quick & Dirty Research• PRWeek contacted the PR heads of several major corporations in

various sectors in Canada, and some said they have responded by pulling back their budgets for 2009. They all, however, agreed that they will be looking at ways to get more out of their PR dollars.– Scotiabank will trim its PR budget next year, as it aims to do “more with

less” because of the economy– “We want to make sure that at the time the bank's various business

lines are looking for ways to seek revenue growth with tighter operating budgets…” Frank Switzer, director of public affairs, Scotiabank

• Outside of the financial sector, other in-house PR executives and GMs report budgets next year will be about level with this year, with some expecting PR to take a more prominent role as they significantly pull back on traditional media spend– “With the economy slowing down, PR will grow in its importance as we

try and find unique, meaningful and cost-effective ways to reach customers with our product stories,” Ron Bertram, VP and GM, Nintendo of Canada

Quick & Dirty Research• In the Czech Republic, research undertaken by JWA for IBF shows that:

– Prague Airport – will do MORE marketing as nothing significant executed in the previous year and needs to be stepped up!

– Hotel Jalta – will continue to do as much, but will change its target audience… before did a lot of hard selling to financial institutions, banks, funds etc and will now concentrate more on ICT (internet, communication and new technologies) and the pharmaceutical industry.

– London Logic Prague – will concentrate on Google adword campaigns and website optimisation, trying to make the adwords campaigns more and more sharply focused so that cost per click and value per click gets higher. But won’t cut back overall.

• PPF claims, that CR market will NOT be buffered, according to Czech media

– Creating fund for distressed/undervalued acquisitions, as are Sal. Oppenheim and just about everyone…

• In New Jersey, a state survey showed most companies are shifing their integrated marketing communications budgets toward online programs.

– One survey (Strategy-Business.com) suggests 50% of marketing budgets will go to online marketing.

Quick & Dirty Research

• General Motors to significantly reduce its 2009 marketing budget, vice president of North American sales, service and marketing, Mark LaNeve

• R3, a regional marketing consultancy, recently published a study on Asian regional marketing budget allocations in 2009. The study was conducted through phone, email and face-to-face meetings with 50 senior marketers in Asia, covering 100 of Asia's top 500 brands. They include Unilever, DHL, Samsung, VISA, Maybank, Pepsi, Tiger Beer, and Haier.– 94% of respondents forecasting the same or less budget for their

brands– 25% see decline of 20% or more on 2008– over 40% of marketers to invest less in ATL media than other

fields

Quick & Dirty Research

• An online BNET study had the following responses:– Get aggressive. Now is the time to outshine a

competitor. (54%) – Cut the budget, but keep the overall strategy.

(19%) – Emphasize Web and search advertising

because the ROI is easier to measure. (15%) – Scale back to just bare-bones marketing

efforts. (5%)

But IT expenditure still to grow…

• “Worst-case scenario, shows IT spending increase of 2.3 per cent in 2009, down from earlier projection of 5.8 per cent,” Peter Sondergaard, global research head, Gartner,

• Now how is that relevant…?

The trend?

1. Closer to the client

2. More IT related

3. Viral / word of mouth…

Closer & more viral…

• Edelman Group released a study that suggests 'trust in someone like me' has grown from 20% to 68% in two years– If I can identify with you, I'll trust you more

than my doctor! And definitely more than any marketer / brand.

• 43% of Chief Marketing Officers have Word of Mouth as a key strategy– This is for B2C and B2B companies.

Which means…

• It means there’s no where for sucky products to hide. They are doomed.

• It means as marketers we need to sell less and 'facilitate' more.

• It means we need to help connect like minded customers.

• It means we should focus more upstream and how to market 'with' the influential minority

• It means marketers need to think in terms of relevance, credibility and authenticity…obstensibly soft terms amidst an increasingly mathematical, ROI-driven marketing perspective.

Decker Marketing

IT…

• A new report released from online video seeding firm Feed Company shows 70% of ad agency and media buying executives plan to increase budgets for viral video marketing in 2009.– The "Viral Video Marketing Survey: The Agency

Perspective" culled insights on viral video marketing trends from 40 executives at major advertising agencies and media buying firms including Goodby, Silverstein & Partners, Wieden & Kennedy, Digitas, and McCann Erickson

In summary… according to Marketwire

• STRATEGY #1 PR – Not Advertising – is the Strategy of Choice

• STRATEGY #2 Maintain Your Brand through a Regular Web Presence

• STRATEGY #3 Get Smart with Your Mix of Web 2.0 Tools

• STRATEGY #4 Integrate Your Internal Forces for Optimal Results

• STRATEGY #5 Lower Your Paid Search Costs by Raising Your Search Engine Results

• STRATEGY #6 Employ Online Communities to Help You Do Your Job

• STRATEGY #7 Set Goals and Measure Your Results. It’s All about Accountability

• STRATEGY #8 Get Creative to Keep Your Current Customers Happy and Coming Back

• STRATEGY #9 Appeal to News Media with New Tools and Ready-to-go Content

• STRATEGY #10 Monitor Your Competition; Boost the Inbound, Reduce What and Who May Be Tempted To Stray

The movies – a sector example

• Despite a slight decline in box-office sales this year, the demand for cinema remains strong.– This year's biggest hit, Juraj Jakubisko's Bathory, has seen more

than 1 million admissions.

• Czech producers are able to raise more money now thanks to increased state support.– The example of Bathory suggests that higher budgets pay back

at the box office.

• Local films are also easier to promote in the press.– Stars are more readily available for press interviews, photo

opportunities and red-carpet events.– More online and interactive exposure available

• Investors should see local growth potential in areas already being pushed by the major Hollywood studios:– direct-to-consumer video-on-demand distribution, digital

distribution to cinemas and new 3D technology.

• Re. Local market, most of that increased state support is going into production, but there's also money for distribution.– Either way, more money means more flexibility for the producers

to spend more on promotion.

• Hollywood is trying to spend smarter.– That means being more careful about choosing what to produce,

and who to put in it, and how to release it.

• Hard times traditionally means fewer movies, but more investment in the ones that remain — both in production and promotion.

• The majors are pushing digital distribution and 3D — they see these as innovations that will help make their dollar go further and, in the case of 3D, offer audiences a new spectacle.