Analysts to Discuss the Future Role of CRM at Gartner Customer 360 Summit 2011, March 30-April 1, Los Angeles
A digital marketing approach and its associated channels are critical for overcoming the declining effectiveness of mass marketing, according to Gartner, Inc. Although marketers have been using digital channels as part of their campaign management strategies for more than 10 years, most are using them for traditional push, mass-marketed, interruption-type execution of campaigns rather than a two-way engagement approach.
"Mass marketing is no longer a long-term strategy. Mass-marketing campaigns have a 2 percent response rate and are on the decline, whereas by 2015, digital strategies, such as social and mobile marketing, will influence at least 80 percent of consumers' discretionary spending," said Adam Sarner, research director at Gartner. "Marketers still need to shift their traditional campaign management strategy around executing campaigns to a customer and move toward a digital marketing, two-way engagement approach."
Gartner analysts said that this evolving customer-focused strategy harnesses digital techniques and channels that will increase engagement, response and conversion rates.
"The Internet was built on the idea of users collaborating. Once the Internet was commercialized, collaboration was overshadowed by transactional commerce and push-type marketing techniques that focused on one-directional hard sells," said Mr. Sarner. "Today, activity on the Internet has shifted back to its roots in interaction and participation. The hard sell isn't working in this new environment, and successful campaign management strategies have shifted from interruptive push, toward two-way conversations and addressing mutually beneficial approaches to customers' wants and needs, which a digital marketing approach can provide."
The online environment continues to expand, and marketing organizations have more opportunities to be effective. By 2014, 6.7 billion devices will be connected to the Internet. Mobile marketing in the U.S. reached $877.2 million in 2010, up 138 percent from the $368 million spent in 2009. The developing social CRM application market reached $600 million in 2010, and it is expected to reach $1 billion by 2013.
"For marketers and campaign management to use digital channels effectively, these channels can't be just a port for traditional campaign methods," said Mr. Sarner. "Although most marketers are using more than one digital channel, their approach is often no different from a spam model, where success is driven by high volumes and attempting to make a profit from nearly everyone who accepts the offer. Just using digital channels is not the answer."
Gartner's operational definition of digital marketing includes addressable branding/advertising, contextual, marketing, social marketing and transactional marketing. Digital marketing extends the marketing process through channels such as the Web, e-mail, video, mobile applications and social applications, point-of-sale terminals, interactive television, digital signage and kiosks.
"Digital marketing represents a shift in strategy and approach, not just in channels," said Mr. Sarner. "Although traditional campaign management thinking involves executing campaigns directly to the customer, successful digital marketing must act more as a mutually beneficial journey aimed at satisfying customers' wants and needs. This is a customer-focused strategy approach that will profoundly shift traditional campaign management strategy."
However, Mr. Sarner insisted that campaign management and digital marketing do need each other. Although digital marketing represents an opportunity for two-way engagement, digital channels, access to a customer view and precise attribution metrics, campaign management represents multiple processes and channels, online and offline integration, and a complete customer record. Going forward, marketers will need to consider campaign management as a way to orchestrate the complexity of a complete online and offline marketing strategy, while incorporating the evolving customer approach of digital marketing.
Additional information is available in the Gartner report "Digital Marketing: The Critical Trek for Multichannel Campaign Management." The report is available on Gartner's website at http://www.gartner.com/resId=1560514.
About Gartner Customer 360 Summit
At the Gartner Customer 360 Summit, Gartner analysts will provide guidance on how to apply intelligence to customer interactions and become socially aligned and digitally enabled. They will also explore best practices and technology to effectively help organizations use analytics, and achieve lasting improvements in data quality.
The Gartner Customer 360 Summit 2011 will take place from March 30 to April 1 in Los Angeles. For further information about the summit, please visitwww.gartner.com/us/crm. Event analyst blogs, and tweets related to the event can be found at http://www.gartner.com/technology/summits/na/customer-360/media.jsp. Members of the media can register for the Gartner Customer 360 Summit by contacting Christy Pettey firstname.lastname@example.org.
Additional information from the event will be shared on Twitter at http://twitter.com/Gartner_inc, using #GartnerCRM.
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