Philip Kotler - Marketing | Digital Marketing

and because of that it's a real honor for us to be here supporting and introducing dr philip kotler dr cutler has defined marketing as quote the science and art of exploring creating and delivering value to satisfy the needs of a target market at a profit he is recognized around the world as one of the foremost experts on business of marketing and for his insights on how exemplary marketing has the creativity and the power to influence global consumers every day in that spirit i hope you'll join me in welcoming dr philip kotler now before i turn the microphone over to dr cutler in the spirit of marketing maybe many of you in this room know that aeon does a great many things globally but one of the things that we've done that has created tremendous brand awareness for our firm is our sponsorship of the manchester united football team which by today won two to one versus arsenal where we're at we're at the right now we're at the top of the premier league so in that spirit i would like to present dr coddler with his very own personalized manchester united thank you david thank you very much uh and i will wear this uh in in a fantasy way uh may i say uh i really appreciate your introduction of all the introductions i've received yours as the most recent nation nation well you may know stephen colbert so i can't pull it off the same way there will be two groups with respect to marketing there will be a group that does doesn't like marketing and i'm going to give you why they don't like marketing and the justifications i will also tell you there's another group who loves marketing so before we're through you'll be totally confused uh or at least opinionated um so what i want to do is uh tell you that these are called confessions of a marketer that's by the way borrowed from david ogilvy who wrote a wonderful book called confessions of an advertising man and let me move on and say why is marketing a topic for the humanities and we would say that there's a couple of reasons one i i regard marketing as a humanistic subject because marketing has affected our lifestyles has created not only affected a lifestyle but created lifestyles and we should be from a point of view of popular interest interested in that and it uh really uh i want to say that marketing is very american that its beginnings are very american that doesn't mean there weren't manifestations of marketing earlier and as a matter of fact i'd like to give you a very short history of marketing so that you understand what we mean by the word as a matter of fact if you took a dictionary a webster's dictionary in the year 1900 and looked up the word marketing you would not find it in the dictionary yes you would find the word market but not the word marketing if you then picked a dictionary 1910 you would find the word marketing in it because marketing is about 100 years old and it's much more than selling so let me show you let's start let's start biblically let's start biblically who is the marketer in this picture this is the biblical narrative who is the first marketer in the world i hear eve the snake i hate to admit it because snakes town sounds like sneaky and so on and so forth but the fact is that it was a snake who can who sold eve on getting adam to eat an apple so it goes way back at least selling goes way back now let's go further here is the father of marketing wow what an insult to him uh i mean that's aristotle recently i was at a group a little party and we were speculating who we would like to meet most if we had an hour with such a person and it boiled down to plato socrates or aristotle that's a hard one it turns out that uh my vote went for aristotle aristotle was google at the time he was he knew more about everything than anyone in the world he wrote on science politics economics rhetoric art and everything now why do i say that he had some marketing impact let me read the definition of the of rhetoric and he is the he's not the founder of rhetoric by the way the founders were the sophists around 600 bc there were a group who wanted to use selling and speech and persuasion for their own devious ends but aristotle put the eye the discipline of rhetoric on its on its feet rhetoric is the art that aims to improve the facility of speakers or writers who attempt to inform persuade or motivate particular audiences in specific situations it is the faculty of observing in any given case the available means of persuasion so in a sense he could be the father of selling the idea of getting someone to do something that they might not have done otherwise so let's move on about other early manifestations of marketing i know many of you cannot necessarily read this so i will read it but the first department store opened when and then what country normally if you're in france and you ask the question they will say of course we invented the department store it was about 1845. the same time we invented paperweights and some other things but it turns out that uh the first department store was in japan mitsui company which is still alive and well so that's where one of our retailing forms started the next one is the first newspaper that carried an ad there were newspapers early but the first ad appeared in england in 1652 and it advertised coffee and then the first ad agency started a little later and well much later nw airs which is still a a prosperous advertising agency first time a a brand was put on a commodity the commodity being soap the brand name was pears soap and then the first packaging appeared a little later and finally we had a marketing research department uh formed so now the word markets has been around all all these years the middle ages had markets in fact whenever i would even say the agora in ancient greece that means the marketplace in ancient greece uh people would come on a particular day and to sell things in the middle ages there were market days the word marketing wasn't there it was just market and trade was always there because trade through history has taken place between people and and regions and countries so all that is there and it was in the decade of the 1900s that marketing books first appeared and the interesting thing is who wrote those first marketing books were they sociologists what was the what was the discipline of the people who wrote the first marketing books any guesses where they weren't physicists or chemists they were economists so why would economists start a subject called marketing and the answer is they were disillusioned economists they they couldn't find any mention of advertising in the discourse of economists in other words never did adam smith thomas malthus david ricardo even alfred marshall and so on they rarely talked about other forces that shaped demand the only force that shaped demand in their mind was price you know the famous curve raise the price demand will go down lower the price you can sell more price was the only thing that affected demand so these economists were institutional economists and said hey you got to factor in advertising you got to factor in retail stores wholesalers jobbers agents and and it was the neglect of the classical economist to to not really texture the marketplace and the way an economy work that led to marketing so marketing is technically a branch of economics now who helped develop this field of marketing now probably you don't recognize maybe anyone here there's one person you might recognize i i don't know if if you can see some of these faces but someone recognize anyone there yeah dale carnegie dale carnegie is here and his book was how to win friends and influence people because in doing this i wanted to find out who is the exemplar of the selling method how to win friends and influence people but let me give you the whole picture ernest dichter some of you may know of he was a motivational psychologist and he could explain why people didn't like to eat prunes why they uh why why cigars were offending some people and all kinds of uh things in his book called the study of desire uh he apparently studied with sigmund freud and he brought that kind of mind to marketing but he had an opponent named alfred pollits who was not a head shrinker we call him a um a counter a nose counter the the expressions we would use if you were very psychological you were a head shrinker and otherwise you were a nose counter namely a surveyor you surveyed people you found out what percentage of people were of a certain age and why did they buy a particular product julius walton rosenwald was very much behind the formation of the sears company which was a important episode in the development of our retail chains uh lester wunderman deserves credit as exemplifying the use of direct mail and catalogs that you can sell more directly you don't have to be in a store you can get people to order goods uh by mail and phone later david ogilvy is the exemplar advertising person then stanley marcus of neiman marcus was the fellow who could walk into any retail store and give them a hundred suggestions on how to improve the layout the size of the aisles and and and make a difference in the uh volume of business edward bernays is the father of public relations in the united states his name has sort of become obscure but he really was a very important person the word propaganda was often used in connection with his work because people thought it was it was a model to to motivate you to feel a certain way about anything regardless of the standards involved and then there's dale carnegie in any case how did marketing get its start marketing got its start in sales departments every company has a a sales group and the sales people really want to be in the office of a customer because that's the only way something happens so they don't want to do a lot of homework for example three things they didn't want to do they didn't want to do consumer research in a systematic way because that's taking their time away from selling to customers secondly they would have liked someone else to find leads now a lead means a prospect in fact we distinguish between a hot lead oh boy he's ready to buy he even called us to buy a warm lead a cold lead and so on someone else should do that for the sales people so they don't waste their time call making calls and the third thing was someone had to prepare brochures and ads and the salesman is not skilled the salesperson isn't skilled at communicating through advertising and brochures so sales departments added three people or hired them from time to time later on it exploded to the day today when we have multinationals running with with marketing in other words marketing those three people split from sales and became big enough to be its own department and so some people in the audience here may be a chief marketing officer the old name was vice president of marketing but i like the name chief marketing officer because that person now is part of the chief officers chief information officer chief financial officer chief innovation officer and and the status has moved up some of you may be brand managers may have been in your past experience category managers market segment managers managing distribution channels like retail or wholesale things a pricing manager communication manager database uh manager direct marketers internet people and so on so marketer marketing is is well established now the character of an of a marketing department depends very much on what the ceo thinks of marketing so the one pc eo is a person who took over a company and he says i don't like marketing but i know i need it uh and all i want from marketing is some communications i just want someone to to broadcast and promote us so that person is missing a lot of other things made up for by other ceos who are four pceos now four p ceo says i need a marketing plan and the plan has to mention product that's the first b what what what about our product what's good about it what are the features price what should it be priced at place where should it be made accessible online offline in stores and finally promotion so that's a more educated view of the potential of marketing but there's even a better view and that's called the the ceo who says no i don't want to start with four ps i want to start with the fact the market is com complex there's a lot of segments uh each segment deserves its own plan in fact one one thing we've learned that if you just have one value proposition for the whole market it really doesn't trigger anything in many parts of the market so that ceo says what segment should we go after and what position should we take with each segment what do we say about ourselves and how we can satisfy their needs now there's even a higher type ceo which is exemplified by a. g lafley who ran procter gamble recently retired when you ask a g leftly what's marketing what's your picture he says well me what do you mean marketing is everything now marketing is everything what it means is everything starts with the customer no customers no business and and i think he's making that point very much now moving on there's a lot of things that a chief marketing officer does and i won't go into any detail but there's a lot of tasks and the sad fact is that sometimes the chief marketing officer only lasts on the average of two years in other words does a job and maybe the ceo is not feeling that it really brought in enough new business that the cost of the ce the cmo exceeds what the value of the cmo is there's a lot to go into about why cmos on the average hold on to their job for two years by the way some of them get a better job after two years they become something higher than the chief marketing officer some of them actually are pirated away because they're so good they go to another company to be the ceo but in any case marketing commercial marketing which i've been talking about could have stayed only commercial and then i got involved in with professor sid levy at northwestern we started the idea of broadening marketing because the set of tools that we use to address consumers could be used in other areas so we have a place a thing called place marketing i will get a call from a city let's say and the city says we're not getting enough tourists we don't have any attractions to for them to come and see i would like to get a factory located here we would like some digital people to move here who know digital we want to start at silicon valley so that's place marketing the marketing of a place how do you dress it up and make it attractive against it's all of the other competitive places the second person marketing there's an agency called william morris and a young singer might go to william morris and say look uh i want to get ahead i want to appear on on jay leno's show i want to i want to move up to to being noticed i want high visibility i wrote i wrote a book with the title high visibility how do you get that visibility so william morris will look at the her and her performance and maybe say you know in a sense you don't be offended but we can make you into a better product that's sort of the language you know do your hair differently um walk a little dress differently actually we're going to use you to to reignite the archetype of joe and joan baez you know john baez the folk singer well we need a new joan baez and so we can recast you and form you into the kind of person we all miss uh and so on now social marketing is another branch today there are two thousand social marketers around the world trying to help people eat better exercise more say no to drugs stop smoking get off of tobacco say no to a number of things positive behaviors and negative behaviors by the way my memory is that sweden was one of the first countries to want to raise a nation of non-smokers non-drinkers all the vices and it starts at the primary school level that you could technically raise people to avoid those those vices if that was thought to be good public policy um so that's social marketing now political marketing we're saturated with and uh i i i think it's degenerated but that's another thing fundraising is is part of of of marketing i mean fundraising is is an odd form because you're not exchanging everything else is sort of an exchange of values fundraising seems to be a one-way transfer here's some money for the museum but any fundraiser knows there's something that should come back to the person who is the donor uh and supporter of a museum and working that way is important so these are offshoots now all of us do marketing if you read the list we all do marketing did you ever compete for a job when you knew there were other applicants didn't you dress up as well as you could and and and even prepare what you're gonna say and so on uh did you compete for a desirable apartment which was scarce uh or a member of the opposite sex if you wanted to court someone so in a sense we're human animals who know how to make an impression and market ourselves to some extent what do we dislike about marketing well there's a a long list it's a rather long list uh it intrusion uh interruption exaggeration and so on and so forth and i really made a list that's a little separate from that here are some of the criticisms marketers get consumers to want and spend more than they can afford and we know that from the financial disaster that people were buying homes with maybe nothing down marketers are skilled at creating brand differentiation where it shouldn't exist like with commodities you know a chicken is a chicken cement to cement so they spend a lot of time trying to tell you their cement is really better their salt is really better and so on marketers want to produce and sell more goods without considering the resource and environmental costs of producing the goods the planet earth is affected by the amount of production and the care with which it's done marketers had not paid sufficient attention to product safety and we know that because ralph nader made his career basically car the unsafety of in cars and then we got lead poisoning we got asbestos problems and so on here's a serious criticisms marketers and this is not all marketers these are some particular companies and and so on marketers favor giving the public what it wants whether it's good or not for them sure i'll sell you cigarettes i'll sell you uh anything that will make money therefore marketing promotes a materialistic mindset that as we get turned on to more of a materialistic world a world of ever-changing products and services and keeping up with the joneses and and some of that marketers rarely talk about sane consumption uh yeah some beer companies say please enjoy our beer but don't drink too much that's that's nice that they no one listens to that and you st and you still have binge drinking but uh they're trying to do what they can and so on and so forth now let me just say there's another side this is important to because it's not a simple picture the other side of it is marketing has undoubtedly raised the standard of living in the united states people don't naturally buy new things in other words do you know people used to keep their refrigerators which weren't refrigerators at the time they were ice boxes and they would keep getting going on getting some ice and putting it in the box and so on uh and and even the washing machines were very slow to take in other words people it would be expensive to buy a new appliance but marketers persisted in saying your life will be better with new appliances and that's one of its jobs i would even go so far as to say that marketing is so connected to the idea of the middle class we're talking about preserving and building the middle class and the lifestyle that goes with it and marketing is an essential definer of what it is to be and want what it is to want as a member of the middle class marketing in the form of social marketing has helped improved a lot of things you know one of the first causes that marketing turned to was the environment and and waste and and the ill effects of of some products and so on preserving the environment was one of the first things that social marketers got into now they're into obesity as a problem littering as a problem and other problems marketing is very important to the cultural world museums performing arts and one of the big problems that cultural institutions are facing especially in the performing arts is the aging of audiences how do you get people who are in their 40s to go to opera to go to ballet and so on it's called the graying of the audiences and maybe that problem has been with us for a long time but marketers are at work doing segmentation targeting positioning in order to make sure that all seats are filled in the theater and also the museums are very busy as marketing institutions because they have to get visitors they have to get donors they have to get government grants so marketing is almost an intrinsic function today that's going on but let me this is not a time to take a vote are you do you like marketing you don't like marketing but let me uh show you that the feeling the negative feelings about marketing came up from these people the attackers they they attacked marketing do you recognize anyone you see ralph nader i don't there he is yeah who else well it is ralph nader uh unsafe at any speed rachel carlson by the way deserves so much more credit than we've given to her for her book on the silent spring which was about the chemical pollution the pesticides that were getting into our spring water and so on vance packard who popularized the idea that we are hidden persuaders that when you go into a movie theater you don't know this but an ad is sort of flashing to go and get some popcorn before you sit down subliminal advertising which never did happen but the hidden persuaders and then john kenneth galbraith who pointed out that while we spend so much money in making enough deodorants for any type of interest you have in deodorants in the public sector in the public sector you've got streets that are littered and there's some garbage and there's slow traffic and and uh and and we we so we have a good private sector but we can't enjoy it because the public sector doesn't have the public goods that would facilitate um you got naomi klein who's probably the prototype person now for attacking branding brands brands they're awful brand you're paying more than you need to pay the book is called no logo logo being another name for brand and michael sandell is has this new book out which is really interesting and worth reading he's a fellow who ran a course on justice and and would ask fi groups about this size in at harvard uh what is the just thing to do in each situation but his new book is called what money can't buy the moral limits of marketing where he points out that if you're in jail in california and you don't like to sell you can pay for a better cell you know maybe one with a computer if you want a computer and so on but he's also he thinks today our culture divides people in social classes more clearly we used to go to ball games i would sit next to someone who was rich and someone who was poor we'd all stand in the same line for hot dogs today the guys who are rich are up in the sky box and he calls it the sky boxification of the united states the sky boxification they're eating filet mignon and we peasants are down there having standing in line for our hot dog so we are not meeting each other as we used to in the older days it's a very interesting treatment i like to quote will rogers with this remark uh if advertising if advertisers spent the same amount of money that they on improving the product uh as they do on advertising they wouldn't have to advertise it and that's by the way that's a very profound observation because within in the age of the internet it's so much easier to to talk about a product you like to others and and also about a product you don't like and in a sense if this goes far enough there will be no bad companies anymore it would be not possible for a company to be a bad company because the word of mouth will will sink it so he's sort of touching on that point make make do a good job and uh and don't and others will advertise the good job you did now i want to add another group and this is a group of visionaries and i'd like to call them our best marketers but they're they're not necessarily the chief marketing officer they're ceos but what their their contribution has been the kind you want from your chief marketing officers so who do you see here do you know any of those people yeah you got you got to know some of them but you probably don't know the first one ingvar kempkrod it's very even hard to remember his name but he's that swedish person who who invented ikea who said i must bring down the cost of furniture and i can do that by taking the air out of it and just selling knock-down furniture and now people can afford to have some nice things in their home richard branson is phenomenal he's not only in self-promotion he's one of the best self-promoters possible i don't know if you know that he was in times square some years ago to introduce his new cell phone the virgin cell phone and he said he was going to drop off of a building a 30-story building and uh not wearing any clothes or something so everyone showed up and i don't know why they would want to show up but they showed up in times square and sure he did jump down but it was on a rope and he's carrying a huge version of his new cell phone and uh so everyone not just in times square the reporters were covering it all of new york knew about the new there was a new virgin cell phone so he's very good at that but right now he he told me something i couldn't believe i was in dubai and he gave a speech and we were just chatting and he said where are you from i said chicago he says you know there will be a time when you can go from dubai to chicago in half an hour what is it is this a time machine you're inventing it says no it's just a rocket ship so the rocket ship takes off from dubai just goes right up to the air and lands in chicago so he's working with some people on on the new spaceships basically and you you want to watch him of course uh walt disney great great visionary herb kelleher thanks to him we have southwest airlines which started a whole class of low-cost airlines and then we've got anita roddick who ran the body shop where she said i'm not selling hope i'm selling good skin lotion all the others sell hope there was a famous remark by revlon in the factory we make lipstick in the store we sell hope but uh she she wrestled with that one then you got bill gates steve jobs and jeff bezos uh and jeff let's see we gotta make sure he gets in there uh jeff is is extraordinary if there's anyone who has consumer thinking in his mind wanting the cons to facilitate the consumer to to really order or reorder or return or anything like that and then to buy more than books to buy electronics to buy clothes he's done a marvelous job he's very exemplar in that sense um we're going we're running out of time and i'm going to want some questions from you but let me just refer to a few more things this is a chart i use in the book marketing 3.

0 basically to say that every company should define its mission its vision for the future and its values what it really cares about and if you're a 1. 0 marketer it's a good job you're doing i mean of course you're trying to deliver satisfaction make a profit and and make a good product be better if you're a 2. 0 marketer you want to help people realize their aspirations you want to deliver things that they might aspire to have they will return frequently to buy more and your product is different than the others not only better but different and suddenly you move from mind to heart to spirit what spirit it's that small set of companies that say we're compassionate we have compassion for the state of the world we want to get involved we want the companies to be a machine for improving the lives of people you could say you could reduce that to just some charity work they're doing or it could be a real fundamental strain in the way they do their business we can name some companies that really have felt that they want to help reshape the world into being a better world so that is uh here's one of my favorite companies that illustrate the cells in that picture the sc johnson company in racine wisconsin whose products are shown over here you probably have purchased some of their waxes or some of their insect repellents or other things but they're just winning awards for being a very caring company incidentally a book that you might want to read was called firm is called firms of endearment uh which is a fancy way to say companies we love firms of endearment and i love the subtitle how world-class companies profit from passion and purpose and it's based on asking audiences random uh meeting of people is there any company that you like that you like a lot now let me ask that question name a company that you would dearly miss if it disappeared vanished apple see always apple i thought you were going to say harley davidson but that's that's another one amazon i would miss amazon i i really would i would even subsidize it to continue which one costco of course i'm with you on costco nike okay well you see what happens is these are the names of the companies that came up again and again i don't think there's any surprises there i've asked other countries to do this too because it would be a different mix of companies that would come up but the main thing is these firms of endearment are so much more profitable than the ones that have not been dear to us one of the things is that they they're they're nine or ten times as profitable but let's see why and without going through the everything here look at the last one these are the attributes of that set of that set of companies and the last attribute is they spend less on marketing than rather more because i bet you thought that the companies that were going to be and dear to us are the ones who are just advertising all the time they're so familiar we see coca-cola all the time all the time no they spend less on advertising so who's doing the advertising the customer you guys are so that's where you should put your money create a love affair create fans with others now i'm going to end with two slides this is on a downer a little bit the end of work this is jeremy rifkin's book it's now about 9 or 10 years old and he says because of the slowdown in population growth automation of factories and computers robotics 3d printing can the nation create enough jobs can the world create enough jobs for the population and so on and it raises a question about marketing's role marketing's role normally is seen as to sell you some things the basic role of marketing is to create jobs it is the job creator namely it gets you to want something that someone has to produce so there's a a basic question does marketing really create new jobs does it or does it only create shifts in the shares like if i switch from brand x to brand y that's not creating brand x loses a job and brand wide gets a job so but it is true that if it if we're talking about a new product marketing will help accelerate its recognition the awareness of it and intensify the drive to purchase it in other words we buy our ipads and other things that come along partly because they're they're wanted they're they're they they are desired objects and marketing accelerates the rate at which growth takes place with those new products the other book and i'll end with this is another downer the death of demand uh and what is the relationship between marketing and demand and is he uses the term saturated finding growth in a saturated global economy i've been wrestling with that problem and growth is the issue today growth is the issue growth means jobs and so on and the fact is there are eight ways to grow a business so the title of the book is market your way to grow eight ways to win and you know all of them you know that we can go to to places where there is growth we can sell in china even if it's a low growth here or brazil we know we can grow by acquiring other firms we know we can grow by innovating inventing something new we know we can grow by taking business away from someone else and so on and so forth so one of the things we're wrestling with is how do you as a firm grow and by coincidence another colleague of mine at the kellogg school of management um uh tim he just wrote a book called defending your business and it's so nice that his book came out with mine because the first job is always defend what you've got hold on to the customers you have then you start worrying about some more growth so we both uh as members of the department are wrestling with how to ignore these books and say they're wrong and that there is a bright future ahead so let me stop here and uh take any questions you might have [Applause] [Music] thank you okay we have time for a few questions for professor cutler is there anyone on this side of the auditorium that would like to ask a question have your hands up yes i see uh you over there and uh now [Music] and if there's any other people and there's a person over there thank you would you introduce yourself please my name is iris witkowski and i've been coming to the humanities festival as long as it exists and i very much appreciate your talk today my uh i'm making a statement what really drives me nuts as far as saturation is concerned is the placement of products on television programs uh it used to be that in a movie you'd say oh i saw that brand that seemed to be accidental now it's all over even the anchorman have ll bean jackets on you know that's uh that's the field called product placement and we first got conscious of that with the james bond films where each time there was a different car he drove an audi or he drove something else because it was a matter of what car company would pay the most for the next film to feature that car and now does the person speaking pick up a coke bottle or a pepsi bottle and things like that most of us don't notice it it's not yet that intrusive but it is it has been discovered as a way to get some visibility for certain products product placement i'm cody engel i'm charter humanist again thank you on the evening national news 75 to 80 percent of the ads are for pharmaceuticals uh this and they say awful things about each one and i believe there was a change in legal requirements some years ago and what are your thoughts about that because clearly that advertises driving demand which is driving costs et cetera yeah it's called over-the-counter advertising too but maybe it's also prescription but basically you can make a case for it by saying consumers should know what they might think would be the right thing for them otherwise the only one who could tell them what's right is the doctor and the doctors don't like it of course the doctors in some cases are offended by by the patient saying what he wants is a prescription uh but you know this has happened with lawyers who are advertising now um doctors are advertising themselves even if they don't like that the expert is uh prabhasinha who runs a firm called ces and uh he's always working with the doctors and the pharmaceutical people and um could help answer that any other things that bother you about advertising hi my name is bob michelson thank you professor kotler it is a pleasure to hear you in person you've been uh a big influence in so many people myself in particular for so many years my question one second how many of you read any of my books any hands well thank you very i owe thanks to you please proceed my question is in regards to social media and you start off your presentation talking about so much of marketing was defined at the beginning of the 20th century we're 100 years into it as you look at social media do you see across a continuum of marketing that's being a short-term phenomena or radical change and as we do marketing for the next century that's part one part two do you see uh the ability to apply an roi to social media yeah those are excellent questions i this is not a fad we are in the digital age we we've passed analog and and there's no turning back um that means that i i see the following happening every company i talk to says we're going to go digital too but slowly we're going to rely on our traditional which is uh newspapers which are disappearing by the way radial tv billboards and magazines so at best they will say this let's turn 10 of our next budget over to digital which means say facebook uh twitter and youtube and uh linksys and so on and let's see what happens let's hire a 12 year old uh give them a budget and and hope they come back saying look what i did with facebook look at how many mentions and so on now that goes to your second question how do we measure the impact of using facebook or something like that uh progress is being made but remember we never measured advertising right either i mean traditional advertising was a waste was first of all the basic notion of traditional advertising is is uh you know that half the people will never see the what did wanamaker say i know that half of the money i spent on advertising is wasted it's just i don't know which half basically uh we we ba we judge things by how many people were in principle exposed cost per thousand people exposed when we make an advertising budget and frankly many of them were in the bathroom or the kitchen when the ad appeared so and increasingly people are more on their tvs on their computer screens than they are necessarily watching ads and i think the advertising industry is making a mistake of putting too many ads now i mean there's little content left on some programs with the number of ads that flash buy they're all 30-second things so i now about measuring if if you read advertising age you'll see a lot of statements and claims that uh there is measurement going on one thing i would say is is this don't take your ad budget and take 50 percent and switch it to uh digital which one firm did and it was it was a terrible uh result because until you know what each social medium does what you want is ten percent of your budget going that way and then when there's some proof to put in another five or ten percent into that particular use of the social media okay we've got time for just one more question i know a lot of our attendees are going to other events so we have one right here oh okay please um mark gruen is my name i've been in direct marketing my entire career and so it's interesting that i should follow up a question about measurement and advertising yes because i've lived by biometrics now uh my question is this um i've always guided my marketing decisions according to the so-called four ps or five ps depending on where you're coming from and in terms of the p for placement i mean the internet has certainly flattened the world and our distribution channels have changed but how do you see the evolution of the other p's in this digital age um okay uh first of all let me say i'm so glad you're in direct marketing direct marketing people are much more uh accountable for the results they could actually experiment with trying to release different direct messages and seeing and testing and and then going with the one and knowing what it cost to do the campaign what the the sales were and it's just a pure p l kind of exercise which we couldn't do with just the normal commercials on tv now are you asking where the other three p's are going in a sense like what's happening to product thinking and pricing and place see there will be new distribution channels all the time i've been asked this question when i wrote the book marketing 3.

0 which is really the case that some companies should be socially responsible as well someone would ask me what are you going to come up with 4. 0 and i don't really have an answer because when you go from the mind to the heart to the spirit i don't know how much further you could go but i i am thinking that 4. 0 is going to describe companies in the future that are building ecosystems and platforms where we get involved with them in such a way that everything is being supplied that we want as an individual think of itunes think of the iphone itunes the host setup of create think of harley-davidson if i buy a harley-davidson i'm a member of what they call them the harley the hogs i'm a hog harley uh owner owner groupie and not only that not only that i can take my motorcycle and just go and meet people i don't know some have beards others have beards but they're fake uh they they're wearing leather jacket these are our business people they're maybe uh c financial officers but they want to be macho so they supply a whole system to fit into that more and more companies might sort of begin to think about that now let's take uh what's the one who's making shoes now is it tom's shoes or the other ones apples they're creating a system that's going to go beyond the shoes that you buy it's going to go into clothing it's so some companies as one evolution for certain companies by the way it's not different in business to business where a company that supply boeing supplies 747s and other planes they have to create a whole system so you can't even leave it you know once you get involved once you get with ibm you're not going to leave for honeywell or something like that so this is maybe what 4.