How Brand Experience Will Evolve

Through Direct Marketing

Oz Aksugur
Vice President, Integrated Business Solutions
Wunderman Cato Johnson / Asia Pacific

Brand Summit ‘99 - Chennai

12th November 1999
 Contents
Introduction

New Challenges & New Opportunities Require New Solutions

Branding & Choice of Communications Medium

Starting Point - Direct Marketing as a Cost Effective Brand Management Tool

An Introductory Example

Managing Brand Promise & Brand Experience Across Multiple Touch Points
Integrated View

Successful and Sustainable Brand  Customer Relationship Management An Holistic Approach

Conclusions

© 1999, Wunderman Cato Johnson. All rights reserved.

 Introduction

Rapidly Changing Business Environment

 Evaluating the
Rapidly Changing Environment
• Marketing programs have been gradually shifting from a mass marketing
approach to One-To-One customer relationships with significant
interactions.

• Direct marketing (One-To-One) enables the delivery of a customized

message to a defined audience and the measurement of the response to
that message.

• “Continuous loop” marketing enables companies to evaluate, refine,

improve and customize programs on a One-To-One basis.

• Effective “Continuous loop” marketing programs require detailed

understanding of customers.

© 1999, Wunderman Cato Johnson. All rights reserved.

 Evaluating the
Rapidly Changing Environment
• Companies are recognizing that the key to effective marketing
programs will be to better understand;
– who are the best customers & prospects
– what products and services they want

• Increasingly, companies are using technology to analyze their

customers, target future communications and quantify the return of
marketing investments.

• All channels of customer interactions (direct sales, call centers, direct

mail, the Internet, et al) are being used to further the understanding of
customers and to develop more effective customer relationships.

© 1999, Wunderman Cato Johnson. All rights reserved.

 Evaluating the
Rapidly Changing Environment
• Companies are also recognizing that each customer interaction is a brand and
customer development opportunity. They are becoming more focused on the
demand-side of their business operations.

“… brands exist in stakeholders’ heads and hearts,

not on the sides of packages,
those are simply brand names and logos.”
(‘Driving Brand Value, Duncan & Moriarty, 1997)

• The key focus can no longer only be:

how well a brand value is created
but also
how well brand relationships are managed and cultivated.

© 1999, Wunderman Cato Johnson. All rights reserved.

 Focus : Branding Plus Behavior
Behavior not linked
to the brand is a
transaction without a
multiplier

Behavior
Branding
Branding
without behavior
is unproductive

© 1999, Wunderman Cato Johnson. All rights reserved.

 Adapting to Changing
Branding, Direct Marketing
and Pricing Models
• Corporate branding, pricing and promotional strategies are being
transformed.

• Businesses will be challenged to build brand equity in e-channels and

virtual communities as well as across multiple selling partners,
channels and points of interaction.

• Companies will experiment with new approaches and strategies for

anticipating or influencing the way customers buy
– Highly targeted and personalized interactive and direct marketing tools
– Develop economic approaches to mass customizing products for
individual customers, channels and partners

© 1999, Wunderman Cato Johnson. All rights reserved.

New Challenges & New Opportunities
Require
“New” Solutions

Branding & Choice of

Communications Medium
 Evolution of the “Media Mix”
Brand
Relationships
Require Enterprise Wide
Addressable CRM Approach
Media

Require
Interactive Marketing
Media Database

Mass
Media Adopted from:
Duncan & Moriarty

Awareness Response Dialog

© 1999, Wunderman Cato Johnson. All rights reserved.

 Changes in Customer Relationship
Marketing (CRM) Focus
As companies continue to embrace one-to-one marketing, enterprise-wide CRM will proliferate.

Enterprise Customer
List Management Database Marketing
Management

Direct Marketing Marketing Enterprise Wide

Scope
Mass Segmentations One-To-One
Method
Querying & Decision support and Integration with
Focus Reporting campaign multiple customer
management touchpoints

Drivers Marketing Campaign Customer Event

Direct Mail Triggered
Response Drivers Drivers
Product push Customer Pull
Initiation Push to customer
Batch Continuous - - Real
Cycles Event Time

This illustrates the evolving marketing trend from historical mass market campaigns towards
interactive, one-to-one customer development at an enterprise-wide level.

© 1999, Wunderman Cato Johnson. All rights reserved.

 Transformation from Being a
Product Facing Enterprise to
Market Facing Enterprise
Strategic Increasing
Impact / ROI Commitment
Potential To CRM
Customer Segment Management
• Customer Investment Management
• Cross brand, cross channel, whole life cycle
• Grow customer profitability
Enterprise Capability Development
• Channel Management/Optimization
• D/B Structure / Integration
• E-Business

Functional Capability Building

• Segmentation/Modeling
• Channel capability development (Telemarketing, Web)

Program Support
• Lead generation; Lead conversion; Cross-sell;
Renewal; Win Back
• Brand/sub-brand level

Business Scope
• time
© 1999, Wunderman Cato Johnson. All rights reserved. • complexity
 Starting Point
Direct Marketing as a Cost Effective
Brand Management Tool

An Introductory Example
 COMMITMENT

DESIRED
BEHAVIOR

DEPTH
OF INVOLVEMENT

WCJ Loyalty Framework TM

Model

© 1999, Wunderman Cato Johnson. All rights reserved.

 WCJ Loyalty Framework TM

Putting the Theory Into Action

Strategic Increasing
Impact / ROI Commitment
Potential To CRM
Customer Segment Management
• Customer Investment Management
• Cross brand, cross channel, whole life cycle
• Grow customer profitability
Enterprise Capability Development
• Channel Management/Optimization
• D/B Structure / Integration
• E-Business Cross Brand Segmentation
for Customer Investment
Functional Capability Building and Message Content
• Segmentation/Modeling Management
• Channel capability development (Telemarketing, Web)

Program Support
• Lead generation; Lead conversion; Cross-sell;
Renewal; Win Back
• Brand/sub-brand level

Business Scope
• time
© 1999, Wunderman Cato Johnson. All rights reserved. • complexity
 Where is Each
COMMITMENT

Individual Customer?
DESIRED
BEHAVIOR

DEPTH
OF INVOLVEMENT

COMMITMENT

DESIRED
BEHAVIOR

DEPTH
OF INVOLVEMENT
© 1999, Wunderman Cato Johnson. All rights reserved.
 COMMITMENT

Bringing Individual Customer Views

DESIRED

to ‘Manageable Segments’
BEHAVIOR

DEPTH
OF INVOLVEMENT

 Commitment

$ Desired
Behavior

#
Depth of Involvement
© 1999, Wunderman Cato Johnson. All rights reserved.
 COMMITMENT

DESIRED
BEHAVIOR

Resulting Picture
DEPTH
OF INVOLVEMENT

Hi

Commitment

Low

Depth Of
Low Involvement
Low Desired Hi
Behavior
© 1999, Wunderman Cato Johnson. All rights reserved.
 COMMITMENT

DESIRED
BEHAVIOR
In Reality
DEPTH
OF INVOLVEMENT
Neighborhoods are of Different Sizes

Hi

Commitment

Low

Depth Of
Involvement
Low Desired High
Behaviour
© 1999, Wunderman Cato Johnson. All rights reserved.
 COMMITMENT

Some Important Neighborhoods

DESIRED
BEHAVIOR

DEPTH
OF INVOLVEMENT

‘Brand Loyalists’
Hi Desired Behavior
Hi Depth Of Involvement
Hi Commitment
Hi

Protect & Reward Commitment

Relationship
Low

Depth Of
Low Involvement
Low Desired Hi
Behavior

‘Opportunity Customer’ ‘Product Loyalists’

Low Desired Behavior Hi Desired Behavior
Hi Depth Of Involvement Low Depth Of Involvement
Hi Commitment Hi Commitment
Hi Hi

Increase Commitment Cross Sell & Commitment

Volume & Reward Trial
Value Low Low
Depth Of Depth Of
Low Low
Involvement Involvement
Low Desired Hi Low Desired Hi
Behavior Behavior

© 1999, Wunderman Cato Johnson. All rights reserved.

 COMMITMENT

DESIRED
BEHAVIOR A Key Brand Management Task
DEPTH
OF INVOLVEMENT

‘Valuable Vulnerables’
Hi Desired Behavior
Hi Depth Of Involvement
Low Commitment
Hi

Commitment
Brand Comms &
Manage Image
Relevantly Low

Depth Of
Low Involvement
Low Hi

Desired
Behavior
© 1999, Wunderman Cato Johnson. All rights reserved.
 COMMITMENT

Benefits of this Simple Yet Actionable

and Powerful Methodology
DESIRED
BEHAVIOR

DEPTH
OF INVOLVEMENT

The Background Picture

‘Research’

Customer Neighborhoods
‘The Cube’
Hi
Levers For
Strategy
Hi Development
Hi Lo ‘Loyalty Drivers’
ALL THE TOOLS NECESSARY TO START A PROFITABLE
© 1999, Wunderman Cato Johnson. DIALOG WITH EACH INDIVIDUAL CUSTOMER
All rights reserved.
 Managing
Brand Promise & Brand Experience
Across Multiple Touch Points

Integrated View
 Holistic
Brand  Customer
Relationship Management Model
Brand Positioning
and Promise

Building the Brand Through

Building the Brand Image Customer Needs & Wants the Customer Experience
(Customer Relationship Management)

Direct TV
TV
ITM/OTM Channel Print
Delivery Requirements Integration
Radio Outdoor
Media
Internet
Face to Face
Print Tailored Value Propositions Direct Mail

Continuous Learning

CRM Processes
• Segmentation • Lead generation
• Lead conversion •Referral
© 1999, Wunderman Cato Johnson. • Customer investment
management • Cross-sell / optimize • Win back
© 1999,All
Wunderman
rights reserved.
Cato Johnson. All rights reserved.
 Managing Customer Relationships Requires
Relevant and Consistent Interactions/Dialogue
Across All Channels That Touch the Customer
Customer Lifecycle
© 1999, Wunderman Cato Johnson. All rights reserved.

Lead Development Lead Conversion Relationship Optimization

Brand Positioning Customer
& Promise Experience

VARS/Resellers
Sales Force
Internet/Web
“Customer Touch Points” Telemarketing
Retail
Mail
Events
Promotion

Data
Capture

CRM Infrastructure / Intelligence

• Segmentation • Metrics & Measurement • Channel Alignment / Management
• Marketing Process • Database/ Technology • Organization Design

Key CRM success factors include ability to maximse investment across customer touchpoints, and to maintain synchronicity of
© 1999, Wunderman Cato Johnson. All rights reserved.customer communications.
 Successful and Sustainable
Brand  Customer
Relationship Management
Requires an Holistic Approach

Implementing the Approach

 Customer
Investment

Building Full Customer Relationship

Process

IT
S
RI C

&M
ET

ET
Brand Promise
&M

R IC
(positioning)

Management Capability Through an

S
IT

Organizational Operational
IT & METRICS
Capability Capability

Integrated Business Model

Customer
Investment
Process

IT
ICS

&
ME
TR

T
ME

RI
Brand Promise

CS
&
IT

(positioning)

Organizational Operational
IT & METRICS
Capability Capability

© 1999, Wunderman Cato Johnson. All rights reserved.

 Customer

Framework for a
Investment
Process

IT
S
RI C

&M
ET

ET
Brand Promise
&M

R IC
(positioning)

S
Customer Focused Organization
IT

Organizational Operational
IT & METRICS
Capability Capability

To be successful, an organization must embed CRM philosophy across the five pillars that define a company.

Business Strategy/CRM Goals

Infrastructure Processes
The foundation which The core processes used to create and
enables CRM maintain profitable customer
activities relationships Programs Customer
The specific Value
tactics used to +
meet business Shareholder
goals Value
Knowledge
The data and People
information used to The human resources which make
build and execute CRM happen
CRM Programs

© 1999, Wunderman Cato Johnson. All rights reserved.

 Customer
Investment
Process

IT
S
RI C

&M
ET

ET
Brand Promise

Make-up of the CRM Pillars

&M

R IC
(positioning)

S
IT

Organizational Operational
IT & METRICS
Capability Capability

Each CRM Pillar contains building blocks that are essential to the effectiveness of the overall organization

Knowledge Processes Programs

People Infrastructure
The data and The core processes The specific tactics
The human resources The foundation which
information used to used to create and
which make CRM enables CRM used to meet
build and execute maintain profitable
happen activities business goals
CRM Programs customer relationships

• Organization • Database • Prospect data • Customer • Brand advertising

structure architecture • Customer data Acquisition • Lead generation
• Roles & • Analytic tools (end • Market data • Customer • Conversion
responsibilities user, analysts) • Program learning Management • Activation
• Skills • Call centers • Research learning • Product delivery • Retention
• Website • Decision tools • Product • Reward/recognition
(models, etc.) development • Customer care
• Win-back
• Surveying

© 1999, Wunderman Cato Johnson. All rights reserved.

 Customer

A Clear Methodology is Required to

Investment
Process

IT
S
RI C

&M
ET

ET
Brand Promise
&M

R IC
(positioning)

S
IT

Ensure Successful Implementation

Organizational Operational
IT & METRICS
Capability Capability

Customer
Investment
Process

Philosophy translated
into a reiterative

IT
S
Philosophy

&
RIC

ME
ET
CRM Process

TR
&M

IC
Brand Promise

S
IT
(positioning)

Integrated & Measurable

Organizational
Capability IT & METRICS
Operational
Capability CRM Model
Results Measurement,

Preparation
Analysis & Feedback

Analysis & Research

Strategy/Investment
Planning

Program Execution
Brand Potential Business Growth Objective?
Positioning Customer
& Promise Behaviour
Current Customer Equity?
Optimal
Competitive Behaviour Revenue Potential Analysis
Strategy Value •Right customers
Model •Share of customers
Segments & Current
Environmental Customer Equity Growth Strategy
Audit Target Customer
Audiences Behaviour GAIN KEEP & GROW
Customer Customer
Touchpoint Value Trade Direct Trade Direct
Map Model Change in Customer Equity?
Potential •More value from right customers
Internal Personal Values of the •More of right customers
Business Drivers of Shareholder Other Stakeholders
Key Implementers
Customer Value
Drivers
Behaviour

Each ‘Project’ benefits from

Long-Term Financial
Vision/Intent
Objectives

proven
'Unofficial' Mission
Statement

Each step of the Internal

‘CRM Process’
Internal
Business
Business
Drivers
Drivers
tools and techniques
Current CRM Document Basic Customer Value/Profit Product Umbrella
Product Product
translates into ‘Sub-Processes’  
Fit for Purpose View
Brand Brand
Portfolio Recognition
Recognition Recognition
Current CRM & Planned CRM &
Current Cost Drivers Current Revenue Sources Product A % % %
Marketing/Sales Efforts Marketing/Sales Efforts
Product B % % %

Product C % % %

Product D % % %

Product
The differential
E provides the value % % provides the value
The differential %
contribution weighting of contribution weighting of
Product
Product FRecognition
the ‘Product Brand’. % the ‘Umbrella
% Brand’. %

Each ‘Sub-Process’
= ‘I definitely
know what this product does’
Product Brand Recognition =
‘I definitely know the name of this product’
Umbrella Brand Recognition =

is made up of ‘Projects’
‘I definitely know this product comes from

x company/group.

© 1999, Wunderman Cato Johnson. All rights reserved.

 Conclusions

Holistic Brand  Customer Relationship

Management Beyond Tomorrow
 The Big Big Picture for
Tomorrow & Beyond
Media Platform TV Print Telephone PC
Convergence

Digital
Platform

Access Mobile Home

Divergence PDA Web PCTV
Telephony network
© 1999, Wunderman Cato Johnson. All rights reserved.
 Conclusions
• ‘Branding’ is NOT dead nor is it dying

• In fact it is more alive and relevant now and in the future than
ever before.

• However:
– increasing consumer sophistication means it is no longer sufficient to
develop a ‘Brand Identity’, broadcast it and hope for the best.
– brand experiences / brand relationships need to be actively managed
– tools used for branding and communications have increased in number
and evolved in sophistication

© 1999, Wunderman Cato Johnson. All rights reserved.

 Conclusions
• The discussion no longer can be one of:

‘Mass Comms vs. Direct Comms’

or
‘Above the Line vs. Below the Line’

• But one of:

How to manage brand promise and brand experience/relationship

in tandem in an holistic manner across all touch points,
in the new ‘e-conomy’

© 1999, Wunderman Cato Johnson. All rights reserved.