We all want to be new school and know the latest hit song (via iTunes). I wouldn’t know what that was without looking it up because what I pay attention to the most are things I already love. While I’d like to be cutting edge, the songs that run through my head are more like “The Way We Were,” if I’m feeling melancholy; “Sweet Home Alabama,” if I feel good; or Madonna’s “Like a Virgin,” if I feel, you know, sassy.

What does this have to do with marketing, you ask? We all get in our own grooves. We know what we’ve experienced and what we like, and that makes it easier and more natural to do those “traditional” things and do them well. Each of us seasoned marketers also recognizes that there are a few things we don’t know, so we experiment with new ideas our agencies bring us to try; we test them a bit and learn.

But even agencies are lacking an overall view. They, too, are experimenting with online tools to understand what is possible. Over the last half of 2007, Rubicon Consulting has been doing a lot of research to figure out what has changed in the field of go-to-market. During that time, we’ve studied online Web marketing as one big source of innovation. Our purpose was to open our eyes and see the true relevance of cool Web techniques and methodologies. We also wanted to think about what it can mean as a source of market power and business strategy.

What I see is that there is something we can do online – something not broadly known by anyone (yet) – and I want to share that here. I’m convinced that when we know what is possible, we’ll grow in our ability to address our customers better and create a deeper connection – and thus grow our revenues and own the market. After all, it is all about winning!

Two Important Questions: Whether and Why

While we know that interactive marketing (viral videos, user-generated content, etc.) is “way cool,” what we don’t know is whether it’s worth doing and why. There’s absolutely no data to go on. Just look at Second Life, the much-touted online “world” – it attracted major companies like Sun, IBM and Dell for a time, but these same big names later retreated from the site or let their presence grow stale after failing to generate results.

Making investment decisions is an art. It’s knowing what works, for what purpose. A great marketer needs to know what to do to drive awareness, consideration, preference and purchase as part of the knowledge mix about what is relevant to the audience, what works, what is cost-effective and, ultimately, what delivers results. But what if we don’t know what results we’re looking for? If we don’t know what the new online tools can achieve, then it’s definitely hard to measure, right?

While almost every company is at least experimenting with Internet marketing, many are frustrated because they don’t have a strategic framework for understanding what can be accomplished, when to use which online marketing tools and what rules drive success. In the absence of such a framework, many online programs are driven by coolness or enthusiasm rather than rational market planning. And perhaps that’s why so many folks are doing some “experimentation” with interactive marketing but aren’t in a rush to jump in with both feet (and bring their marketing budget with them). There are several statistics about marketers leaving their dollars in print and traditional advertising vehicles, even while their target audience increasingly lives online.

AMA Survey

A 2007 American Marketing Association survey of senior-level marketers revealed that:

  • About half intend to keep spending in magazines and newspapers at current levels;
  • 26 percent plan to shift dollars away from magazines to other media;
  • 21 percent are doing the same with their newspaper budgets;
  • 54 percent said they’re only “somewhat satisfied” with current (traditional) measurement;
  • 45 percent say it’s very important to improve the accuracy of their reporting;
  • 51 percent want more detailed information about user engagement and interaction; and
  • 74 percent are redirecting print budgets to the Internet.

So we know 74 percent are moving their print budgets, but the fundamental truth behind the AMA statistics is that most don’t know how to measure their new success. People don’t know what they’re aiming for now. Once we understand what new things we can achieve, we can find the metrics to measure them. Measurement follows strategy.

We’re Learning What’s Changing Against Our Old Models

There’s a lot of guidance available in conferences and seminars, but most of it is either too high level or too tactical. We’ve all heard keynote speakers declare things like, “Marketing is dead,” or “Traditional mass media is over,” but that doesn’t really tell a marketing executive what to do (other than to prep her résumé). At the same time, most of what’s discussed in online marketing workshops is extremely tactical – things like guidelines for CEO blogging, search engine optimization and, our current favorite, viral video campaigns.

There’s a gap between high-level vision and in-the-dirt implementation. You need a bridge that gets you from one to the other. One good approach is to compare this new marketing environment against the ways that we have traditionally developed awareness, consideration, preference and purchase (see Figure 1).

What does and doesn’t change when you market online? What I’ve suggested in Figure 1 is that the traditional awareness/ consideration/preference/purchase mix can be driven more effectively. The new world of Internet marketing is both an extension and a redefinition of traditional marketing. The move from one-way mass marketing to two-way individualized marketing challenges us all to rethink not just how we market, but what we’re trying to accomplish when we market. When used correctly, the new Internet marketing tools help companies build dramatically deeper bonds with customers, define markets much more precisely and develop new ways of generating value. Clearly, it’s worth figuring out.

But There’s More

The mistake I see most companies making is that they use new online marketing tools to pursue traditional marketing goals, such as driving awareness, consideration, etc.

It’s a mistake because the rules of traditional marketing were shaped by what could be accomplished using one-way mass media. Frankly, it was the only tool we had available – even just a few years ago. Now that Internet media enables two-way communication, the whole idea of moving customers through a structured consideration process needs to be revised.

The central goal of online marketing isn’t awareness – it’s engagement. And the five key tools to produce engagement are affinity, personality, community, co-creation and advocacy. Engagement is getting the customer involved with your company, with your products and often, with your people. When customers like what they see and experience, the relationship deepens, and it leads to affinity.

Affinity means leveraging the depth and interactivity of the Web to create a memorable relationship with the customer. Some of the best techniques for building affinity include being useful when a customer’s not buying, sharing obsessions, extending the product online and creating cool experiences.

Personality is how your company interacts with the world, both emotionally and rationally. The company’s personality must be both distinctive and genuine. Unlike a brand image, it can’t be faked. Your company’s culture defines the personality you can build online. For example, a company that tells its employees, customers, partners and the public that it’s green but doesn’t recycle its tech waste is contradicting its desired image. This behavior is inconsistent – and it can also harm your firm’s ability to develop a community.

Community as a marketing tool challenges almost every expectation of traditional marketing. Instead of controlling the marketing process, the company hosts a social interaction in which customers develop most of the content. But good communities don’t generally grow on their own; the most effective ones are carefully cultivated and subtly supervised. A company that takes the wrong steps can easily kill a community before it even gets started. The best communities foster sharing, involve influencers and fans, and breed involved customers who may even want to be co-creators with your company.

Co-creators enjoy your product or services so much that they want to build on top of something you’ve already done – or create something new. An example would be a fan who decides he wants to make laces embroidered with his school name to match the basketball shoes you’ve manufactured. It’s the process of engaging customers online to help design the product. When done right, this can be very powerful and provide real revenue benefits. It can also be very intimidating to a company that’s used to doing all the thinking for its customers. It requires a change in mind-set. This goes back to interaction, which I mentioned when we spoke about personality.

Advocacy is a new way to describe customers who used to be considered hobbyists. But these folks take it to a new level of obsession. They are users who like tinkering with a product or service far beyond what the normal user might do – whatever camera, software or appliance the customer advocate or influencer is working on, on the cutting edge. They may take apart then reconstruct your product. They may develop companion services. They may mashup your product with something they developed independently. Working with “influencers” is a very hot topic in online marketing, but it assumes that there’s a small group of people in the population that drives purchases of all products. The reality is much more complicated. A company’s goal should be identifying, caring for and training advocates – customers who are willing to help market your products to others. That’s very different from sending press releases to a few influential bloggers.

Change Can Be Good

Marketing done right is about more than just communicating to customers – it’s about shaping your company’s offerings to match the needs of the marketplace. The Internet enables new business models, including one-to-many communication that we could have only dreamed about previously. It provides us with tools we can use to guard against competitors and lets us explore new possibilities.

Internet marketing is a competitive weapon that can be used to underscore our leadership. There’s tremendous opportunity here for CEOs and marketing folk. Let’s think about what we can achieve with these new approaches and whether that matters to our company goals, and then we’ll know what we want to harness to lead.