Louis Halpern's View on Internet & Hotel Marketing

I’m convinced that Social Technographics is the future when it comes to online marketing strategies. Not enough people understand what this is yet, but utilising it properly is essential if companies are to drive sales upwards in the Internet age. The best way to describe Social Technographics is as a methodology which looks not only at what determines participation on social networking websites, but also viral activity.

Here at Halpern Cowan, we have taken the Forrester Research methodology and applied it in a practical sense. Our aim has always been to improve online marketing strategies – allowing people to sell more from their websites – and our experiences show that Social Technographics can provide much added value to a brand. Naturally, this benefits our clients.

The Internet has taken power away from institutions and put it into communities. It has created an environment where people are comfortable with technology, using it both on a one-to-one basis, and also to communicate far more widely. Each month more and more people go online, reading – or creating – blogs, spending money, or visiting social networking sites.

Recent statistics reveal that 41% of youths visit a social network site daily, and that 92% of email users forward at least one web link every week. What a waste not to take advantage of all that activity!

But many organisations don’t take advantage. This may be because they don’t know how their customers use social technologies, or perhaps because they are inexperienced and don’t know what works, when or where. Some even have a more hidden fear – that just when they’ve mastered one technology, something new will come along and they’ll have to start again. They think, “why bother?” But they’re wrong, and missing out on opportunities.

Our strategy is first to profile the target audience for the product to be sold. Traditional marketing methods are not redundant, and should be used to find out who’s being sold to, and who’s buying. But after doing that, users should be grouped according to how they participate online, in social networks with user generated content, and normal websites. There is a whole world of online users out there – from what we call “creators” (who publish web pages or blogs) to spectators (who read them or listen to podcasts) and those in-between (like critics, who comment on blogs, but don’t generate them). All these people shouldn’t be ignored. In fact they should be specifically targeted and converted into customers and advocates of the product.

We work out how to target different types of Internet users, thinking about their online behaviour and buying lifecycle. We map out how users will participate – both now and in the future – finding out about their propensity to purchase, how they hear about things and how to get them interested. When we do this, we come up with a very effective way to generate online business.

But that’s not the end of it. It’s absolutely vital to understand what makes people want to move up to the next level of the Social Technographics ladder. We create a plan to keep the audience engaged, by using multiple participation points. These don’t need to be scary. First time “users” can be wheedled in by making it easy and fun – asking then when they first heard a popular song, for example – so they don’t even think about the fact that they’re taking part. Finding user generated content needs to be simple, and users should always be tempted to go to the website. That leaves you in control.

There’s a definite parallel between the new Social Technographics ladder and the traditional marketing lifecycle. Using them together gives you a very powerful tool.

Giving £200,000 to save endangered Arctic seals is now no longer enough. If companies are going to integrate Corporate Social Responsibility into their objectives, they need to do so with utter conviction and a dedication to doing it properly. They need to do it in line with their own business models and brand strategies.

CSR only works when it is built into the very fabric of an organisation and is actually weaved into a company’s ethos. It involves paying much more than mere lip service and involves a company actually becoming one with its stated CSR objectives. These objectives then become key components of its marketing strategy because the two can’t be divorced from one another.

We all can name one or two companies that have leveraged CSR into the heart of their organisation. Think Innocent Smoothies, Clipper Tea, Green & Blacks, Pret a Manger, Big Issue – their CSR philosophies are intimately woven into their brand image. The two can’t be separated. And this is where marketing’s future lies – the integration of CSR into the heart and soul of both a company and therefore also its marketing strategy.

An interesting example of how CSR can be integrated within a marketing strategy has been demonstrated by one of Halpern Cowan’s clients, Malmaison, the boutique hotel chain. The company is making a dedicated effort to source its hotel food and beverages form local suppliers. In doing so it reduces its carbon footprint whilst also boosting local small businesses, and further improving the quality of its offering.

Yes, it takes effort for Malmaison to source locally and the food costs might increase, but the overall community goodwill combined with a real sense of trying to be environmentally responsible is an intelligent strategy. Indeed, the extra few thousand pounds it might cost annually to source local produce is the equivalent of a quarter page ad in the Times. When viewed as a marketing cost, it’s negligible.

CSR initiatives, when done properly, are priceless because they demonstrate to their customers that ‘we’re all in this together – your issues are our issues’. Brands no longer become isolated but are viewed as partners by their customers. Indeed, CSR offers huge opportunities to show that a brand not only understands its customers but also that it is willing to stand in partnership with them. That’s one powerful strategy. But a word of warning: such a strategy demands courage, conviction and 100% commitment at all levels of an organisation.

Did anyone see Ryan Air’s full page advertisement mocking Gordon Blair’s aviation fuel tax in this week’s Times (Feb 28th edition)? Moreover, did you see within the same paper the advertisement by Virgin Media publicly chastising Sky? Both advertisements reflect a sea change in UK advertising.

I put it to you to you that ads that merely promote products may no longer work. Aspirational creative copy and Œhigh-life¹ art direction that serve to showcase the latest products are not achieving cut-through and more importantly not engaging consumers in any meaningful way. Aspirational advertising that focuses on wealth as a measurement of human value is being subsumed and overtaken by a groundswell movement towards social responsibility, environment and community.

The trigger points for this change are varied but driving the movement forward is digital technology. In an age of MySpaces, YouTubes and with 43 per cent of internet content now user-generated, companies are having to reflect a new culture of openness and honesty. The Internet has levelled the playing field and produced an online society where individual wealth is of minimal importance and, instead, human and corporate responsibility are the issues of the day.

According to insiders, BP now spends about 75 per cent of its annual marketing spend pushing green issues. Ads about high-octane fuel, additives and the latest engine-friendly oil no longer drive sales. Instead, BP only wants to talk about its forays into solar and wind power and how BP will help save the planet. Marketing based on corporate responsibility is being mirrored everywhere ­ Honda, Dove, Chevron, Marks & Spencer, Virgin etc ­they’re all at it.

M&S’ corporate responsibility chief, Mike Barry, came out publicly late last year and said, “M&S’ Look Behind the Label marketing campaign has been our most successful ever”. M&S’ group head of marketing was also quoted as saying the ads have “had a significant effect for a small investment”. The campaign simply informed consumers of the ethical credentials of M&S food and clothing.The advertising industry is not leading the way but simply mirroring what is foremost on consumers’ minds. Social responsibility, the environment, ethical trading and community are now top of the agenda and brands must wake up and acknowledge this mounting consumer pressure. Failure to do so will see brand values disintegrate in the new debates over carbon footprints, world poverty, third world sweatshops, fair trading, advertising to minors, nutritional values etc and, most importantly, communal well-being.

Humanity is raising its game and it is demanding that we, as advertisers, fall into line. Advertising in the future must therefore focus on people’s needs and communal well-being rather than individual aspiration and greed. Address this and the future of your brand will be safe. Ignore it and the future of your brand will be perilous.

Marketing magazine recently asked me the question ‘Is Viral Marketing acceptable for all brands?’ I could see their point – viral marketing has a reputation for being cutting edge, left of centre, mischievous, irreverent, risky and any other phrase you might want to throw at it. But that’s a misperception. Yes, some viral campaigns are all of the above. But that’s a feature of the viral campaign’s creative execution, not viral marketing as a channel. Think about it. If every 48-sheet poster campaign was hard hitting, near-the-knuckle and hit you straight between the eyes, the medium would soon gain a reputation for being a slightly dangerous advertising channel. But that’s got nothing to do with the channel and everything to do with the creative execution.

In fact, virals work for all brands because viral marketing relies on ‘referrals’ and there isn’t a brand in the world that doesn’t want to be referred! The only difference is that computer-to-computer referral accelerates people’s ability to communicate whereas mouth-to-mouth referral takes longer.

It’s because of this ‘instant communication’ that brands need to consider all the ramifications of a viral campaign before it goes out. Once it’s been sent out, it’s simply too late as the brand loses control of who it’s sent to and how the viral will be perceived. An ill-thought out viral can be sent across the world in seconds – just look at VW’s Polo viral of a Palestinian terrorist, how quickly that spread and the fall-out at VW’s Wolfsburg HQ. More thought needs to go into the upfront creation of a viral and that’s where brands get caught out.

The solution is therefore to be completely clear upfront as to all the various permutations and consequences of sending out a viral email. It demands creative excellence allied to clever strategists who understand the brand and how a viral campaign could impact it. Get these right and the results can build brand awareness and generate response at an unsurpassed level of ROI.

We recently created and broadcast a viral campaign for the hotel brand Malmaison (www.malmaisonthedream.com). The ‘dream’ viral campaign, which at the time of writing is only two weeks old (and still on an upward trajectory) saw a staggering 60,000 unique visitors visit Malmaison’s website on a Saturday, and bookings followed suit. That’s a significant increase and sums up what viral marketing is all about: instant referral and astounding ROI.

Financial services enjoys the largest online spend of any sector.  You’d have thought therefore that a cursory glance at a random selection of financial services websites would demonstrate the craft of website design and content in all its full glory.   But you’d be wrong.  The vast majority of financial services websites lag far behind other sectors in terms of design, navigation, and most crucially content. The reason for this is that financial services websites are primarily product driven.  This is the same for aggregator and comparison sites such as Moneysupermarket and Moneyweb as well as company specific sites such as new.egg.com.  Want a mortgage?  Check out the latest rates below.  Want a credit card?  Click here for 0% on all balance transfers.  Want a pension?  Try this fabulous stakeholder pension or perhaps consider a high income bond.
A little online research will quickly show that nearly all financial services websites are product driven.  If you go the website of a big bank, such as Barclays, you’ll get products.  Similarly if you go to a niche provider, such as Cahoot, you’ll see its product-led home page. All of these sites function essentially as a financial services version of an Argos catalogue.  It’s as short-sighted a view as obtaining a credit card on the basis that the first two months charges are slightly below the norm.
Financial services websites should be needs driven, not product driven.  After all, when you signed on the dotted line for your mortgage did you not wonder whether this was the best product or advice available?  Considering this is the largest financial decision you might ever make, such lack of clear advice and information is remarkable.  Thankfully, this is all about to change and the next generation of financial websites will not be product driven.  Instead, they will be needs driven.
This will demand a level of intelligence and interactivity not yet seen in the financial services sector.  We’ve witnessed the first green shoots of this trend with sites such as Halifax’s Buying Your First Home website (http://www.buyingyourfirsthome.co.uk/) taking a needs-driven approach.  The Halifax realised that with first-time buyers making-up 22 per cent of the total UK mortgage market and typically aged 25-34 yrs old, the opportunity to position themselves as a genuine advice source was too good to pass up.  However, providing information is one thing, making that information personal and relevant to the individual is altogether a different task.  It demands the ability to profile a person and provide an accurate and detailed source of information that meets the individual’s requirements. It needs to deliver customised content to the end user (user-centricity) by collating all the information that people need and presenting it in a way that informs people, not sells.
The new generation of Web 2.0 websites like Myspace, Youtube etc owe their success to the fact they are needs generated.  With their clever use of tagging, Dot net 2.0 architecture, Soap, Atlas etc, these social networking sites are like search engines – very democratic whilst providing users with the ability to find what they want.  The financial services sector should be going in the same direction.  The sector must consider people’s lifestyles, preferences and focus on how a particular issue affects a person’s life.  It should offer lifestyle websites that sell items as a by-product, not as a primary reason.  By not hard selling and providing honest information, the sector will create trust.  And it’s by creating trust that the new generation of financial websites will succeed.