NEW OPPORTUNITIES VIA MARKETING INNOVATION

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DEAR READER !HI, MY NAME IS NICOLAI, AND I’M CEO & PARTNER IN THE CREATIVE DIGITAL AGENCY KONSTELLATION. OUR AGENCY HAS A PASSION FOR PROJECTS THAT CREATE EXCITING USER EXPERIENCES AND VALUE. OUR CORE PRODUCTS ARE MARKETING INNOVATION AND BRAND ACTIVATION. WE’VE BEEN INVOLVED WITH MARKETING INNOVATION FOR THE PAST 4 YEARS. IN 2013, WE WERE VERY HONORED TO WIN SEVERAL INTERNATIONAL AWARDS FOR THE WORK WE DID FOR MEDICINS SANS FRONTIERS - DOCTORS WITHOUT BORDERS. !DURING THE AGENCY’S LIFETIME, 3 OTHER COMPANIES HAVE BEEN BORN OUT OF THE KONSTELLATION FAMILY. ONE OF THEM, “BITBUCKET”, WAS SOLD IN 2010 TO THE AUSTRALIAN COMPANY ATLASSIAN.    !I LOOK FORWARD TO SHARING OUR THOUGHTS ON MARKETING INNOVATION IN THE FOLLOWING SLIDES. I HOPE TO INSPIRE YOU AND GIVE YOU A FEW NEW IDEAS AND PERSPECTIVES TO TAKE HOME WITH YOU. !!BEST REGARDS, NICOLAI ELMQVIST CEO & PARTNER !+29 44 41 08 ne@konstellation.dk ! dk.linkedin.com/in/elmqvist/

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WHAT IS MARKETING INNOVATION?

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MARKETING INNOVATION MEANS WE CREATE PRODUCTS, SERVICES OR EXPERIENCES THAT USE MEDIA AND

TECHNOLOGY IN SURPRISING NEW WAYS.

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MARKETING INNOVATION IS AN ALTERNATIVE TO NORMAL MARKETING. IT FUNCTIONS AS AN ADD-ON

FOR ACHIEVING STRONG RESULTS. MARKETING INNOVATION SHOULD BE USED AS A BOOST THAT WILL ENABLE A BUSINESS TO REACH ITS GOALS.

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MARKETING INNOVATION SUPPORTS YOUR CORE BUSINESS AND BUILDS UPON THE THINGS YOU ALREADY

DO WELL. !

IT IS NOT A NEW LINE OF BUSINESS. IT’S MORE OF A MARKETING INITIATIVE THAT CAN GROW INTO

SOMETHING BIGGER - IF IT’S DONE RIGHT.

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CORE BUSINESS

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Experience

ServiceProduct

WHAT VALUE DOES MARKETING INNOVATION CREATE FOR YOUR CUSTOMERS?

New and exciting experiences

Services that make our daily lives easier

New clever products / tools

Sweet spot

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A new service, product or line of business

Dynamic and edgy

Customer loyalty

Competitive advantages

Leads / new customers

Bottom line

WHAT VALUE DOES MARKETING INNOVATION CREATE FOR YOUR BRAND?

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3 EXAMPLESATTRACT NEW CUSTOMERS DANSKE BANK’S MOBILEPAY IS A GOOD EXAMPLE OF A SERVICE THAT HAS MADE IT EASIER FOR PEOPLE TO TRANSFER MONEY TO EACH OTHER - EVEN PEOPLE WHO ARE NOT CUSTOMERS OF DANSKE BANK. MOBILEPAY IS A STRONG SOLUTION THAT MAKES DAILY LIFE JUST A LITTLE BIT EASIER. IT HAS BEEN A WAY FOR DANSKE BANK TO PROVE THAT IT SETS NEW STANDARDS FOR DIGITAL SERVICE PRODUCTS. !SOCIAL VALUE FOR DONATIONS LIKES FOR DONATIONS IS A SOCIAL DONATION PLATFORM THAT MAKES IT POSSIBLE FOR USERS TO DONATE MONEY FOR A GOOD CAUSE BY ACTIVATING FACEBOOK FRIENDS. THIS CREATES SOCIAL VALUE FOR THE USER AS WELL AS INCREASED AWARENESS AND DONATIONS TO THE CHARITY - IN THIS CASE, DOCTORS WITHOUT BORDERS. SEE CASE VIDEO HERE: http://vimeo.com/61092852 !!WIN OVER A TARGET AUDIENCE FRIDGE RAIDERS (A BRAND OF SNACK CHIPS) CREATED A CAMPAIGN TARGETED TOWARDS ONE SPECIFIC SEGMENT: GAMERS. THEY ACTIVATED THIS TARGET GROUP TO CO-CREATE A GAMING HELMET THAT MADE IT POSSIBLE TO SNACK AND GAME AT THE SAME TIME. THIS WAS A HUGE SUCCESS AND AFTERWARDS, THE USERS WANTED THE HELMET PUT INTO PRODUCTION. SEE CASE VIDEO HERE: http://vimeo.com/67875725

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Product DevelopmentMarketing Innovation

THERE WILL ALWAYS BE GREY AREAS, BUT AS A POINT OF DEPARTURE, MARKETING INNOVATION ACTS TO SUPPORT THE CORE BUSINESS. FROM THERE, IT MIGHT DEVELOP INTO A NEW

LINE OF BUSINESS IF EVERYTHING GOES WELL. IF THAT HAPPENS, MARKETING INNOVATION WILL THEN TRANSFORM

INTO PRODUCT DEVELOPMENT.

VS.

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Product Development - A new line of business

Marketing Innovation- Supports the core business

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NIKE+FROM MARKETING INNOVATION TO PRODUCT DEVELOPMENT NIKE+ IS A GOOD EXAMPLE OF A MARKETING EXERCISE THAT HAS DEVELOPED INTO SEVERAL NEW PRODUCT LAUNCHES. !IT ALL STARTED WITH A FREE COMMUNITY WHICH SLOWLY ADDED NEW EXTRA PRODUCTS AND NEW DIMENSIONS TO THE EXPERIENCE OF SPORTS. IN THE BEGINNING, THE FOCUS WAS ON RUNNING. BUT WITH THE LAUNCH OF THE NIKE FUEL BAND LAST YEAR, NIKE HAS NOW REACHED OUT TO MORE OR LESS EVERY TYPE OF SPORT. NIKE+ STARTED AS A MARKETING EXERCISE AND HAS EVOLVED INTO AN ACTUAL BUSINESS LINE OF DIGITAL PRODUCTS THAT SUPPORT NIKE’S CORE BUSINESS. !MY OWN EXPERIENCE WITH NIKE FUEL BAND IS THAT IT IS REALLY MOTIVATING - EVEN ON DAYS WHERE YOU DON’T REACH YOUR GOAL. FOR EXAMPLE, MY DAILY GOAL OF REACHING 3000 POINTS DEMANDS A MINIMUM OF 30 MINUTE RUN AND A GOOD LONG WALK IF THE REMAINING TIME IS SPENT IN A OFFICE CHAIR OR ON THE COUCH. !SEE CASE VIDEO ABOUT NIKE FUEL BAND: http://www.youtube.com/watch?v=dG0vLFFtZDs

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MARKETING INNOVATION IS FOR EVERYBODY!

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IF YOU’RE WILLING TO TAKE THE PLUNGE INTO MARKETING INNOVATION, EVEN SMALL BUDGETS CAN TAKE YOU A LONG WAY. LET ME TELL YOU ABOUT ONE OF MY FAVORITE CASE EXAMPLES FROM LAST YEAR. !A SMALL PIZZA JOINT IN DUBAI SHOWED HOW TO CREATE GREAT VALUE FOR BOTH USERS AND THE BRAND WITH A VERY SIMPLE SOLUTION: A V.I.P. REFRIGERATOR MAGNET. !THIS IS A SPECIAL MAGNET. ALL THAT YOU THE CUSTOMER HAD TO DO IS PRESS THE MAGNET - ONE SIMPLE PRESS - AND A HOT, TASTY PIZZA WAS DELIVERED STRAIGHT TO YOUR DOOR.   !THE BUDGET FOR THIS MARKETING INNOVATION WAS 9000 US DOLLARS. SALES INCREASED 500% AND THE MEDIA BUZZ WAS WORTH 8 MILLION DOLLARS. THIS LITTLE GIMMICK SHOWS SOME OF THE GREAT OPPORTUNITIES AVAILABLE FOR COMPANIES THAT DARE TO THINK DIFFERENTLY. !SEE CASE VIDEO HERE: http://www.youtube.com/watch?v=-Y51eqhlnRY

RED TOMATO

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HOW TO AVOID CRASHING ON THE WAY

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PROCESS

Pre-launchInnovations process

Prototyping ProductionPurpose Launch

THERE ISN’T JUST ONE CLEAR WAY TO WORK WITH MARKETING INNOVATION. THE DIAGRAM BELOW IS AN EXAMPLE OF A PROCESS WHICH WILL PROVIDE YOU WITH FAST CONCRETE SOLUTIONS AND MINIMIZE THE RISK OF HAVING AN END PRODUCT THAT WAS NOT EXACTLY WHAT YOU HOPED FOR.

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HOW SHOULD WE INVEST?

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BEHIND EVERY SUCCESSFUL MARKETING INNOVATION THERE’S AN INVESTMENT. THIS MEANS YOU SHOULD RESERVE A CERTAIN AMOUNT FOR EXPERIMENTS. COCA COLA HAS A 70 / 20 / 10 PRINCIPLE IN WHICH 70 % GOES TO BREAD & BUTTER TARGETING OF THE PUBLIC AT LARGE, 20 % GOES TO TOMORROW’S BREAD & BUTTER, AND THE FINAL 10 % IS USED FOR EXPERIMENTS. WITHIN THE 10 % THERE WILL BE BOTH SUCCESSES AND FAILURES, BUT COCA COLA LEARNS FROM BOTH. !!COCA COLA CONTENT 2020 PART 1 & 2: http://www.youtube.com/watch?v=G1P3r2EsAos

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A new product, service or line of business

Dynamic and egde

Customer loyalty

Competitive advantage

Leads / new customers

Bottom line

WHAT WILL YOU GAIN?DECIDE WHAT MARKETING INNOVATION SHOULD DO FOR YOUR COMPANY. FRAME THE IDEA, BUT KEEP YOUR OPTIONS OPEN. NEW IDEAS MIGHT ARISE DURING THE PROCESS THAT COULD GIVE AN EVEN GREATER RETURN ON YOUR INVESTMENT.

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IS THE ORGANIZATION READY?

Sales

Marketing

IT

Management

R&D

Lokale market

ONCE YOU HAVE SETTLED ON A BUDGET, YOU HAVE TO ENSURE THAT YOUR ORGANIZATION SUPPORTS YOU. IT’S IMPORTANT THAT YOU HAVE ALL THE NECESSARY RESOURCES TO TAKE YOU TOWARDS YOUR GOAL. MAYBE I.T. AND SALES HAVE A LOT OF USEFUL DATA OR MAYBE R&D IS ALREADY DOING SIMILAR PROJECTS OR DEVELOPING OTHER VALUABLE RESOURCES THAT MIGHT BE AT YOUR DISPOSAL. IT’S ALSO VERY IMPORTANT THAT TOP MANAGEMENT UNDERSTANDS THE NEW DIRECTION YOUR COMPANY IS TAKING WITH MARKETING INNOVATION. IF EVERYTHING GOES WELL IT MIGHT RESULT IN A NEW LINE OF BUSINESS. !!FOR LARGE GLOBAL COMPANIES, RESOURCES MIGHT ALSO BE FOUND IN LOCAL MARKETS. BUT KEEP IN MIND THAT NEW TECHNOLOGY QUICKLY BECOMES YESTERDAY’S NEWS. IF YOUR SEARCH FOR FUNDS DEMANDS A WORLD TOUR, YOU RISK THAT YOUR IDEA WILL BECOME OUTDATED OR THAT OTHERS WILL BEAT YOU TO IT BEFORE YOU HAVE A CHANCE TO LAUNCH.

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EXPLORE!THINK WHITELABEL

IF YOU HAVE A BACKGROUND IN MARKETING AND HAVE BEEN DOING ADS AND TV COMMERCIALS FOR MANY YEARS, THE FOLLOWING MIGHT FEEL VERY TRANSGRESSIVE: WHEN WORKING WITH MARKETING INNOVATION, THE BEST THING IS OFTEN TO FORGET ALL ABOUT THE BRAND’S DNA, IMAGE AND OTHER MARKETING-RELATED TERMS. THESE BUSINESS PRACTICES OFTEN FILTER OUT INSTEAD OF PROMOTE GREAT NEW IDEAS.  MY ADVICE IS TO THINK IN WHITE LABEL SOLUTIONS. MARKETING INNOVATION IS RARELY RELATED TO ONE SPECIFIC BRAND. ITS ABOUT THE VALUE IT BRINGS TO THE CONSUMER. THE GOOD NEWS IS THAT AFTERWARDS YOU CAN EASILY ADD A STORYTELLING LAYER ON TOP. !HAVE AN OPEN MIND TOWARDS TECHNOLOGIES. EXAMINE WHAT CONSUMER NEEDS YOU CAN HELP SOLVE, COMPARED TO YOUR GOALS. AND ALWAYS KEEP THE PROCESS OPEN FOR NEW DIRECTIONS.

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LABS FORCE FOR INNOVATION

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INNOVATION CAN EMERGE IN MANY WAYS AND WILL VARY DEPENDING ON THE COMPANY. AT KONSTELLATION, WE HAVE A FORUM CALLED LABS - IT’S OUR AGENCY’S OWN R&D DEPARTMENT. 10 % OF OUR TIME IS SPENT IN THE LABS EITHER WITH OR WITHOUT THE CUSTOMER. WE BELIEVE IT’S ESSENTIAL FOR AGENCIES TO HAVE THIS TYPE OF FORUM IN ORDER TO MAINTAIN THE KNOW-HOW WE NEED TO SERVE CLIENTS. IT MAKES DISCOVERING NEW POSSIBILITIES AND NEW USES OF MEDIA OR TECHNOLOGY EASIER. !!OUT OF LABS COME INNOVATIVE IDEAS WHICH SOMETIMES END AS PROJECTS AND OTHER TIMES ARE SEEN AS VALUABLE LEARNING. ONE EXAMPLE OF AN IDEA THAT ORIGINATED FROM LABS IS A GLOBAL REAL-TIME PENALTY KICK COMPETITION. A PERSON IN LONDON COULD SCORE A GOAL AGAINST A GOALKEEPER STANDING IN TOKYO IN REAL TIME BY THE USE OF TECHNOLOGY. !THE IDEA WAS ILLUSTRATED IN A CASE VIDEO AND A PROTOTYPE WAS DEVELOPED TO SHOW HOW A REAL TIME SOLUTION WOULD WORK. SUBSEQUENTLY, KONSTELLATION PITCHED THE IDEA TO LARGE GLOBAL BRANDS. !!SEE THE VIDEOS HERE: !CONCEPT: http://vimeo.com/48062146 PROOF OF CONCEPT: http://vimeo.com/48062175

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GO OUT AND TALK WITH YOUR TARGET AUDIENCE. UNDERSTAND THEIR INTERACTIONS AND SEE WHAT MEDIA THEY USE. OFTEN, THIS IS WHERE YOU’LL FIND THE MOST VALUABLE INSIGHTS - NOT AT THE OFFICE OR IN MEETINGS. !!ALWAYS REMEMBER THAT IT’S ABOUT MAKING THEIR DAILY LIVES MORE AWESOME AND FIGURING OUT HOW YOUR IDEAS WILL ACTIVATE THEM. IF THE CONSUMERS ARE ABLE TO SEE THE VALUE IN YOUR SOLUTION, THEN YOU’RE ON THE RIGHT TRACK.

THE CONSUMER

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THIS IS AN EXAMPLE WHERE ENTHUSIASM FOR TECHNOLOGY TOTALLY BYPASSED THE REAL VALUE FOR END-USERS. BUDWEISER LAUNCHED AN INTERACTIVE BEER CUP, THE BUDDY CUP. WHEN YOU TOAST WITH SOMEONE AT A BAR, BUMPING CUPS, THE BUDDY CUP CONNECTS YOU AS FACEBOOK FRIENDS. FIRST OF ALL, PEOPLE DON’T ALWAYS WANT TO DRINK BEER OUT OF CUPS. SECONDLY, PEOPLE AT BARS USUALLY TOAST WITH PEOPLE THEY’RE ALREADY FRIENDS WITH. THIRDLY, THE REGISTRATION AND SETUP OF THE INTERACTIVE CUP WAS VERY COMPLICATED. FINALLY, MOST PEOPLE DON’T WANT TO BECOME FACEBOOK FRIENDS WITH RANDOM PEOPLE AT A BAR. ADWEEK WAS ALSO VERY BLUNT IN ITS EVALUATION OF THE CUP. !SEE CASE VIDEO: http://www.youtube.com/watch?v=PSwmVxHEFkM

BUDDY CUP - FAIL!

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KEEP IT SIMPLE

IT HAS TO BE INTUITIVE AND EASY TO ACCESS. WE CANNOT EXPECT THAT PEOPLE WILL USE A LOT OF TIME ON SOMETHING THEY DON’T IMMEDIATELY UNDERSTAND. THE COMPLEXITY HAS TO LIE BETWEEN THE LINES SO WHAT IS OFFERED TO THE CONSUMERS IS EASY TO DECODE AND GENERATES INSTANT VALUE.  

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DOES IT MATCH

YOUR POSITION?ONCE YOU HAVE THE IDEA, IT’S IMPORTANT THAT IT CONNECTS WITH YOUR EXISTING BRAND. THE GOOD NEWS IS THAT IT’S ACTUALLY POSSIBLE AND FAIRLY EASY TO INTEGRATE A BRANDING-LAYER TO THE INVENTION.

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PROTOTYPEBEFORE YOU CHOOSE TO MOVE FORWARD WITH THE IDEA, IT’S IMPORTANT THAT THE SOLUTION IS TESTED AND BUILDS ON A PROTOTYPE THAT CLEARLY ILLUSTRATES HOW YOUR SOLUTION THE OPPORTUNITY TO REFINE THE IDEA AND ENSURE THAT THE SOLUTION IS ACTUALLY DOABLE.  

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INNOVATION IS MARKETING

OWN MEDIA

EARNED MEDIA

AWARDS

NOW YOU HAVE CREATED AN INVENTION. THE GOOD NEWS IS THAT THIS IN ITSELF IS NEWS. DUE TO THE INNOVATION, MANY JOURNALISTS WILL WANT TO WRITE ABOUT IT. THIS MEANS INNOVATION IS MARKETING AND CREATES FREE PUBLICITY. IF WE MANAGE TO BE REALLY CREATIVE, PERHAPS WE CAN EVEN WIN AWARDS, RESULTING IN EVEN MORE PUBLICITY. !EVEN IF YOU DON’T HAVE A REAL PRODUCT YET, IT’S STILL POSSIBLE TO TAKE OWNERSHIP OF THE IDEA BY DOING A PRE-LAUNCH, WHICH WILL CREATE A LOT OF BUZZ. IT’S A GOLDEN OPPORTUNITY TO EXAMINE YOUR MARKET AND FIND OUT WHETHER IT’S POSSIBLE TO CREATE THE DESIRED HYPE. !ONE OF THE BRANDS DOING THE BEST JOB OF EXPLOITING THIS OPPORTUNITY IS HEINEKEN. THEY HAVE LAUNCHED 4 MARKETING INNOVATIONS WITHIN THE PAST YEAR ALONE. !SEE VIDEO: http://www.youtube.com/watch?v=LcLjfN6kxN0

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FAIL FASTERYOUR CUSTOMER IS THERE TO HELPIF YOU DECIDE TO CONTINUE THE WORK AND RELEASE AN ACTUAL PRODUCT, YOU DON’T NECESSARILY HAVE TO LAUNCH IT ALL AT ONCE. THERE SHOULD BE ROOM FOR BOTH MISTAKES AND THE OPPORTUNITY TO INVITE CONSUMERS ALONG IN THE PROCESS. THIS WILL ACTIVATE CONSUMERS TO HELP CREATE THE PRODUCT. !IF WE MANAGE TO CREATE SOMETHING CONSUMERS CAN’T LIVE WITHOUT, THEY WILL BE WILLING TO SPEND A LOT OF TIME SUGGESTING IMPROVEMENTS AND NEW FEATURES FOR THE PRODUCT.

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SPOT-ON!

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MEN HVAD NU?

HOWEVER… AFTER THE OVERWHELMING SUCCESS, THE MENTAL HANGOVERS STARTS OCCURRING. WHAT NOW? HOW DO YOU CARRY ON, AND WHAT SHOULD BE THE NEXT STEP? !OBVIOUSLY, THE ANSWER IS NOT SIMPLE. BUT FORTUNATELY THERE ARE A LOT OF OPPORTUNITIES THAT CAN KEEP YOU ON TRACK. !LOOK PLACES YOU DON’T NORMALLY LOOK. INVITE A BUNCH OF ENGINEERS TO YOUR MARKETING DEPARTMENT. HANG OUT IN STARTUP COMMUNITIES AND LISTEN TO THEIR IDEAS. HOST OPEN INNOVATION SESSIONS. THE OPTIONS ARE ENDLESS. ALL IT TAKES IS FOR YOU TO KEEP ADDING NEW MUSIC TO THE PARTY.

CREATIVE HANGOVER

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JUST DO IT! GET OFF YOUR ARSE AND CHANGE THE WORLD

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5 THINGS TO TAKE AWAY:

‣ SET A BUDGET ASIDE FOR EXPERIMENTING ‣ FIND THE RIGHT PEOPLE ‣ TAKE OWNERSHIP AS QUICKLY AS POSSIBLE ‣ PUBLISH ONCE THE IDEA EMERGES ‣ FAIL FASTER AND INVOLVE YOUR CONSUMERS

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THANK YOU!NICOLAI ELMQVIST

CEO & PARTNER I KONSTELLATION APS !

+29 44 41 08 ne@konstellation.dk

http://www.konstellation.dk