It's beauty's top commandment: Know thy consumer, and communicate with her effectively. But Marc Pritchard — president of global cosmetics and retail hair color for Procter & Gamble, chairman of the Cosmetic, Toiletry and Fragrance Association and the host of a panel on the subject — says it's that second point that can be a challenge for marketers.
"The digital world has brought an explosion of ways to communicate with consumers," said Pritchard, "and that means that we need to look at different strategies of how we need to market to her." Chief among them are the myriad electronic forms of communication — cable and satellite TV, the Internet and cell phone blasts, in particular. "TV used to be the big three networks, and now it's cable, satellite, digital — as many as 600 channels," said Pritchard. "And the Internet was born with Web sites for geeks, but now everybody is online and you can get virtually anything. So think about it this way — it's simple: Online is no longer the new media, it's part of the mainstream media."
In fact, "new" media is increasingly the first place consumers are looking for product information. Mentioning a recent conversation with his 15-year-old daughter, Pritchard said she spends three or four hours online per day and doesn't watch TV very often. She also always has her cell phone, so that she can text-message and take calls, he added. "So that means on Cover Girl, without a digital strategy, I may not even be having a dialogue with my own daughter," Pritchard said with a chuckle. "And by the way, it's not just teens. We've done some research, and 30- to 35-year-old soccer moms are consuming media in much the same way.
"Despite the complexity of the digital world, I believe marketing is still fairly simple," said Pritchard. "It's about the brand, the message and the media. But we need to change how we communicate with consumers." Pritchard pointed to Lauder's Sean John fragrance launch and MasterCard as effective examples of this strategy — albeit often in unexpected ways, he said. "MasterCard is a credit card company, so you'd think that they'd focus on transactions, trying to get people to buy more. Instead, they focus on creating the emotional connection of bringing people life's treasures and priceless moments, the little pleasures that people value the most. They blend a conventional strategy that has TV and print with a digital strategy that creates a personalized dialog with consumers."At a minimum, every company in this room needs to have a digital marketing strategy, because we need to keep up with [the consumer] and she's moving at lightning speed," continued Pritchard. "We also need to recognize the dramatic changes that are occurring because of communications technology. And as technology advances at an even faster pace, we need to accelerate our experimentation so the beauty industry is a leader in the future of marketing."
Pritchard and his panel's commandments include creating a relevant and meaningful dialog that matters to the consumer; rewarding differently; expecting failure and allocating a set amount of money to marketing experiments; anointing a digital czar; creating a content strategy, and, above all, having a digital strategy to leverage the new inflection points so beauty can be the leadership in the future of marketing. "Think of mobile marketing as a new screen," urged Pritchard. "We already have TV screens, we have computer screens, we've now got a cell phone screen. And that screen can bring in anything — text, audio, video, movies, shows, commercials, whatever the case may be. Our job is to figure out how to make it relevant for the consumer so they invite us in."
That's something that Pritchard's panel — Deborah Wahl Meyer, vice president of marketing for Lexus, and Marc Lefar, chief marketing officer of Cingular Wireless — know only too well.
And those numbers can be staggering. "We're the largest U.S. [wireless] carrier and we cover 273 million people across the country with our voice and data networks," said Lefar. "We have 56 million customer relationships and last year generated $34 billion in revenue and are growing at double-digit rates each year." Non-voice business last year totaled $2.6 billion, he said, adding that global text and instant messages will exceed 1.6 trillion this year, up 35 percent from last year, and picture and video messages will exceed 3 billion.
Cingular Wireless was, last year, the number-two purveyor of digital music in the country — second only to iTunes, Lefar said. "The digital music business for us last year was $750 million," said Lefar. "The games, graphics and images — while we've been sitting here today in this room, 75,000 mobile games have been downloaded to people's phones, just today. And that's just our company, and we're just below a third of the market. Thirty billion text messages were sent or received in the past year. Five hundred million multimedia messages, that's video messages or picture messages. And while you might not do it on a regular basis, there's an awful lot of people now with new phones, crisp screens on high-speed networks, that are doing Internet browsing directly off of their phones. And that number is growing fivefold to tenfold every six months in terms of the number of browsing sessions we're seeing. These are real businesses."They are, however, nail-biting for marketers not accustomed to giving away so much of the power to consumers. "She's always had opinions, but now she has a voice," noted Pritchard. "She can evaluate, criticize, praise or even kill a new product idea or reputation. What if just a few thousand of the 30 million blogs started to attack one of our product launches? Consumers never had that kind of power before."
Wahl Meyer agreed. "The Web sites and the Web blogs are very interesting but very scary for us, because it really is letting the consumer have control and seeing what happens," said Wahl Meyer, who added that the brand chose to go this route as bloggers and enthusiast clubs would be the most likely, if things went well, to get a buzz about Lexus' new model out on the Web. She admits this strategy carried a big risk, though: "If they didn't like it, we were cooked, because they were also the most likely to get the word out about it and take the story a lot further.
"For the first week of looking at the results on this thing, it was the most nail-biting experience I personally have ever been through," remembered Wahl Meyer. "Comments started coming in, and I'd say at least half of them were negative. So I'm about to dive under my desk; I'm not coming out. And about six days later, as I'm still following all these changes, all of a sudden the conversation starts to turn around," she said, adding that it evolved into a well-balanced and positive discussion. "By the time we got to the launch and the cars were actually on sale in the store, we had enormous amounts of traffic coming into the stores, and we've exceeded our sales objectives in every month since," she said.
But, Lefar warns, "Don't kid yourself that you're going to be able to control that dialog. A lot of smart marketers think, ‘If I can just be really brilliant at marketing' — which is doing some of the stuff we've talked about today — ‘that's going to drive my product through the roof.' Well, I'm sorry to tell you, but if you've got a crap product and don't have a value proposition people care about, expanding the dialog and trying to drive that proactively is just going to kill you faster. It actually helps those who really have good products and have content that people care about. And for those that don't have a good value proposition, it exposes your weakness and lack of depth very, very quickly."To that point, Wahl Meyer suggested allocating at least 10 percent of a company's media budget just to experiments. Lefar agreed: "Tell people that you expect failure and welcome it. If some of the experiments don't fail, if they can't measure them, if things don't just blow up in your face occasionally, you're not pushing the right buttons. So I think leaders need to set that expectation in their organization, to expect failures." One non-traditional project Wahl Meyer is working on is creating informational content on TiVo Showcase, a project of TiVo.
But the message is clear: Ignore the "new media" channel at your peril. "American Idol — this year [it] will drive almost 100 million messages, just this season alone. This business has expanded into downloadable ring tones from the drama that happened just last night," said Lefar. "You can have those contestants' ring tones on your phone, chat communities, blogs, all accessible via your wireless phone. Think about it: Three years ago, nobody would've talked about a wireless phone as an entertainment vehicle. It didn't exist." But the times, they are a-changing. "The forecast right now is that by 2009, 35 percent of children between the ages of five and nine will have dedicated numbers for cell phones. This is far from a mature business, even outside of the U.S."
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