Web 2.0

‘The times they are a changing’

Dr. Jim Hamill and Alan Stevenson

Department of MarketingUniversity of Strathclyde

jim.hamill@ukonline.co.uk

May, 2009

Topic 1

Web 2.0

An Overview

What Is It?

A new buzz word coined by management consultants to encourage us to part with our hard earned cash

or

A fundamental change in the way people use the Internet, their online expectations and experiences

What Is It?

It’s a fundamental, revolutionary change……

Major impact on consumer/B2B decision-making and behaviour across a broad spectrum of industries

Major opportunities, but also threats, for your organisation

Marketing as a ‘conversation with your customers, a conversation with your network’

What Is It?

All revolutions have ‘winners’ and ‘losers’. ‘Winners’ will be those organisations who fully utilise the interactive power of Web 2.0 technology for engaging with and energising customer and network relationships

Requires a new ‘mindset’ and new approaches to marketing communications strategy and implementation

Requires new performance measures – Quality of your network

– Relationship strength

– Ability to leverage

Web 2.0

A fundamental change in the way people use the Internet …….

Rather than being passive recipients of ‘brand messages’, Web 2.0 is characterised by

– Information ‘pull’ rather than ‘push’– User generated content– Openness, sharing, collaboration, interaction, communities, and

social networking

‘Power to the people’ – Web 2.0 empowers people – empowers customers

Web 2.0

The end of the..........

The read only Internet

The ‘tell them how good’ we are Internet

Traditional ‘push’ marketing strategies (declining effectiveness – nobody listens any more)

The ‘Brand’ as we know it – People are becoming ‘cynical’ to brands and resistant to brand messages- -the ‘brand’ becomes the customer experience

The end of the ‘About Us’ web site…..and the beginning of the ‘About You’ web site

Source: The Future of Advertising, APA, 17/02/09 as published on Slideshare (www.slideshare.com)

In a Web 2.0 Era, the Brand Becomes the Customer Experience of the Brand

A quick ‘personal experience’

Dubai Hotel

From the web site

• This 5-star hotel and residence offers European hospitality with an unmistakable French touch. The hotel consists of 318 beautifully appointed guest rooms/suites, while the residence offers 112 fully furnished and equipped deluxe Studios and 1-3 bedroom apartments.

• The ultimate in comfort, we offer 318 luxuriously elegant rooms and suites.

• Take a trip. Escape. Go and visit somewhere new and see if we are there… Give in to that irresistible wanderlust. Discovering and staying in the most exceptional hotels in the world has become the modern-day Graal, a game, a quest…

The Customer Experience of the Brand

Tripadvisor

From Tripadvisor

• It's getting old, the rooms are unappealing and it will never be more than a business hotel

• Being a Sofitel hotel we expected something quite 'flashy' unfortunately we were let down. The rooms, although comfortable and clean, were not of the standard we expected and were definately not what we expected after looking at the photos on the hotel's website.

• Booking my stay via the Sofitel website after a pleasant experience at several other Sofitel locations over the past 2 years with my new job I was looking forward to a 5 star luxury stay after a stressful business trip. My expectations were reasonable, however certainly not met by this hotel.

Web 2.0

Applications

Social Network Sites

Social Content

Social Bookmarks

Blogs

Wikis

Virtual Realities

RSS Feeds

Podcasts

Social Applications

Twitter

Mash Ups

Mobile Web; Internet Telephony

Internal and External Use

These applications can be used on your own web site and/or by participating in

‘external 2.0’ sites

Characteristics

Communities and Networks

Interactivity

Social Element

Openness

Peering

Hosted Services

Global

Sharing

Empowerment

Mass Collaboration

The Internet as the platform

Impact

Business Intelligence

Customer Interaction

Sales & Marketing

Customer Experience

Customer Insight

Processes and HRM

Mindset

Product Development

Reputation Management

Rich Internet Applications

IT Infrastructure

Business/Marketing 2.0

Web 2.0 Applications

Open sourceOnline Applications/ Web ServicesSocial Network SitesSocial Content – Social BookmarkingBlogs or WeblogsWikisPodcasts/ VodcastsVirtual RealitiesMash UpsRSS FeedsMobile Web; Internet TelephonyTwitter

Characteristics

Communities and NetworksOpennessSharingPeeringHosted Services – online applications; the Internet as the platformInteractivitySocial ElementMass CollaborationEmpowermentGlobal

Impact – Wikibusiness

MindsetBusiness IntelligenceCustomer Insight and UnderstandingCustomer InteractionEnhanced Customer Experience –

Rich Internet ApplicationsReputation ManagementSales and Marketing Product Development and R&D e.g.

engage and co-createIT/Software/ApplicationsOperations, Internal Processes and

HRM

Business Impact

The need for new business/marketing models

– Traditional approach:

• Product development – Differentiate – Market and Promote - Sell

– New model based on:

• Communities, networks, openness, peering, sharing, collaboration, customer empowerment, ‘think and act’ globally

A few references.........

Wikinomics

Tapscott and Williams (2006)

Web 2.0 represents a major paradigm shift and requires new corporate mindsets and new approaches to business strategy development, implementation and online branding.

O’Reilly (2006)........Web 2.0 as ‘a set of economic, social, and technology trends that collectively form the basis for the next generation of the Internet—a more mature, distinctive medium characterised by user participation, openness, and network effect.’

The Groundswell

Li and Bernoff (2008)

A spontaneous movement of people using online tools to connect, take charge of their own experiences and get what they need from each other (information, support, ideas, products, bargaining power etc)

The ‘groundswell’ is unstoppable – it’s a social revolution

It’s a permanent, revolutionary shift in the way the world works

You can try to fight it or join it – energise the groundswell

Marketing to the Social WebLarry Weber (2009)

Marketers must look for new ways to communicate with customers. New mindsets and a radical rethinking of past practice is required

Rather than broadcasting sales messages to an audience who no longer listen, innovative marketers should become ‘aggregators of customer communities’. They should participate in, organise and encourage social networks that people what to belong to

Rather than talking at customers they should talk with them

Grown Digital – Don Tapscott (2009)

  $4m research project covering 10,000 people in the age

group 11 to 30

The Net Generation – the first generation to have grown digital

Revolutionary impact on all aspects of life including the world of work, education, family relationships, political engagement and the global environment

YouTube Videos

Bob Dylan

Come gather 'round peopleWherever you roamAnd don’t criticise

What you can't understandYour sons and your daughters

Are beyond your commandYour old road is

Rapidly agin‘Then you better start swimmin’

Or you'll sink like a stoneFor the times they are a-changin’

Strategic Audit

The Ten Key Questions

Ten Key Questions

1. What impact is Web 2.0 having on my industry?

2. What are the opportunities and threats for my organisation? How well are we currently positioned to capitalise on these opportunities, minimise the threats? What progress have we made? What is the ‘strategic gap’ between where we are and where we should be? What internal organisational barriers and obstacles need to be overcome for us to make progress in this area?

3. What impact is Web 2.0 having on consumer behaviour and decision-making in our industry?

Ten Key Questions

4. Do we need a new business ‘mindset’ and organisational structure to succeed in a Web 2.0 environment?

5. How can we best utilise Web 2.0 for effective reputation management?

6. How can we best use Web 2.0 for market/customer research; for building deep customer insight, knowledge and understanding?

7. How can we best use Web 2.0 applications for building on-going customer dialogue and interaction; for enhancing the online customer experience; for engaging with and energising our network?

Ten Key Questions

8. What are the key Web 2.0 actions and initiatives we need to introduce?

9. What new business performance metrics do we need to use in a Web 2.0 era?

10. How can we best use Web 2.0 for improving internal operational efficiency and business processes?

Questions