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International Advertising Association (IAA)

New Normal: digital + social networks

Dr. Elinor Garely, eTN  May 24, 2010

Although it is clear that print media is on the decline and digital media is expanding, many decision-makers in the hospitality, travel, and tourism industry cling to the past. "New Normal" reflects the current and future of media – marketing/advertising through the eyes of marketing experts from a variety of industries and clearly a wake-up call: print is yesterday; digital is today and tomorrow!

Promoted as the "New Normal," the NY Chapter of the International Advertising Association (IAA) brought industry leaders together to assess the current marketing atmosphere and to forecast the future of social networks. Held at the posh Time Warner Center, the 6th Global Marketing Summit’s advertising and marketing all-stars commented on the current failures of the world economies, while acknowledging the reality of the business cycle. With the attitude of “this too shall pass,” speakers were forthright in expressing the reality of social networking and the challenges presented in using the Facebook/Twitter/LinkedIn/company blogs/YouTube and ezine modalities to move products and services to consumers in the digital age.

Although the depression/recession was acknowledged as an economic reality, many took the Sam Walton approach to the situation. Walton, the founder of Wal-Mart is noted as saying, “Recession? I thought about it, and decided not to take part.”

Don’t Stop Marketing
Upon hearing the word “recession,” conventional wisdom would have chief financial officers (CFOs) rushing to department managers ringing the alarm bell to fire and downsize, cancel country club memberships, and curtail all marketing, advertising, public relations, promotions, and related expenditures. In fact, in the New York Controller’s Report (2002), CFO’s reported a 32 percent reduction in sales and marketing expenditures; however, this same report found that 30 percent of the CFO’s increased sales and marketing expenditures, demonstrating that at least some executives realize that good fortune follow the brave (and market savvy).

Strategic Thinking
During periods of economic contraction, a cutback in marketing is not the smartest strategy. Companies that continue to spend and/or increase their marketing budgets are the enterprises that are the most successful during and after an economic downturn. A 1998 PIMS study of 450 companies doing business during a recession, determined that companies that maintained their marketing spending emerged stronger after a recession than those that did not.

Intrusion or Engagement
It is more important than ever to focus on the wants and needs of the consumer and to use the medium that moves the message through the channels that get consumer response. The question to consider: is the message an intrusion into the conversation or part of the engagement process? Since consumers do not like to be interrupted, the marketing message must be relevant and useful. When AT&T sponsored the “call a friend” portion of Who Wants to be a Millionaire, the “call” was part of the AT&T marketing strategy. On American Idol, the AT&T network is used to text votes for the next Idol. The challenge is to organically integrate the product/service so it enhances the communication experience.

Consumers have a variety of ways to get information. They don’t have to watch television, listen to the radio, scan an online newsletter, or read a newspaper. The measure of success is to make the advertising content as compelling as the platform that is utilized. The more involved the consumer the more likely there will be a partnership between the consumer and the product and the larger the personal investment - the greater success of the product.

Travel and Tourism Industry
While marketing/advertising industry gurus are advocating “authenticity” in products, acknowledging mistakes (i.e., Toyota), integrating the product into the personal space of consumers (i.e., Jeep, WWE, Google), the travel and tourism industry has been very slow to acknowledge the "New Normal." Rather than acknowledge consumer dissatisfaction with hotels and related services (i.e., Trip Advisor, Elliot’s Email) hotel management ignores and/or discredits the reliability of the complaints determining that the consumer cannot possibly be right. Airlines encourage negativity from consumers placing greater fees on the shoulders of the consumer taking the government approach of passing administrative errors into the pockets of the consumer/citizen.

No Need to be Authentic
With the demise of travel-related magazines and limited newspapers, the industry has cut marketing dollars believing that the main reason people are not traveling is based on economics and not on the fact that they have become disillusioned with the industry. The airbrush approach to travel – selling a flawed product as though it was perfect and charging hundreds of dollars a night for a product not worth a fraction of the price - has made the holiday seeker a cautious consumer. Unfortunately the industry has not acknowledged the new consumer (and the "New Normal") requirement for transparency and authenticity.

Bad Things Happen
When bad things happen to good consumers and the hotel, destination, airline, car rental organization is silent, the statement has already been made. According to Professor Paul Argenti in the Financial Times (December 28, 2009) “You either tell your story or have it told for you.” With communications the “two-way dialogue” (aided by social media) and the “explosion of information-sharing online,” the center of control has shifted from “institutions to communities of individuals.”

Lessons Learned: Social Groups, Sharon Driscoll, VP, IBM
At the IAA conference Sharon Driscoll, VP, Demand Generation for STG/IBM, focused on the need to develop a “conversation” with the consumer, which is now possible through social networks. Vincent Frazzo, director, Global Media and Integrated Communications for Coty Prestige, integrates web-connected social marketing into the traditional marketing – mix to learn how consumers actually do their shopping. Barry Salzman, head of media and platforms for the Americas/Google identified a shift in consumer behavior... it has become a “seamless movement” from one media to another. The challenge is to select the appropriate to reflect the quality and values of the product/service that ring-true with the consumer.

Steven Carter, VP, marketing operations for American Honda Motor Company, discussed the use of social media using Facebook. The campaign “Everybody knows somebody who owns a Honda” brought hundreds of thousands to Honda’s Facebook message. Howard Sherman, president of Doremus, found that it was no longer appropriate to think in terms of media but rather to look at communication options as “platforms.” This communications cross-over has created a synergy between one media form and the other. More than ever, market planning must be based on consumer behavior and not preconceived notions of what are good or bad communication channels.

Andrey Sergeyevi, business development and marketing director for Forticom/DST, is responsible for developing the Eastern European version of Facebook and over 17 million users are part of this growing social network that includes Russia, Lithuania, and Poland.

The Elephant in the Room
The question to the hospitality, travel and tourism industry is when will leadership acknowledge the fact that in the "New Normal" electronics/digital is king. There is no way to turn back the clock. The new possibilities require the focus to turn toward ezines, emails, and all forms of social networking while listening to the wants/needs/criticisms and suggestions of the business and leisure consumer – if there is any hope for bringing the customer back to travel. The old “my way or the highway” has gone the way of the dinosaur.

New Normal: digital + social networks
Sharon Driscoll, VP, IBM

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