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James McQuivey was once again the keynote presenter at Southwest Media Group's third annual Digital Summit. Soul Mate: Mr. James McQuivey, Vice President, Principal Analyst Forrester Research James serves Consumer Product Strategy professionals. He analyzes television and media technology and specializes in the future of the moving image, including digital video recorders, HDTV, video on demand, Internet-based video, and the business implications of each of these disruptive technologies or movements. Beyond this, he also covers digital music and digital publishing and shares with other Forrester analysts an interest in the future of the digital home.
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© 2011 Forrester Research, Inc. Reproduction Prohibited1 © 2009 Forrester Research, Inc. Reproduction Prohibited
Living Digitally:Marketing in the Era of Experience
James L. McQuivey, Ph.D.
VP, Principal Analyst
Southwest Media Group Digital Summit 20113 May 2011
Follow me on Twitter: jmcquivey
© 2011 Forrester Research, Inc. Reproduction Prohibited2
Dr. Everett Rogers
S-curves
Diffusion of Innovation
Syracuse
© 2011 Forrester Research, Inc. Reproduction Prohibited3
World Wide Web
I get this
CD-ROM
Predict the future
Forrester
© 2011 Forrester Research, Inc. Reproduction Prohibited4
A digital adoption revolution is occurring
New adoption characteristics have emerged
Something is making people adopt faster than
they ever have
The same factors that have combined to create
new adoption patterns are still at work
They will change the experience of every other
product and service
© 2011 Forrester Research, Inc. Reproduction Prohibited5
Consider the top digital products of 2010
Kindle: Approximately 8 million US users
– About half of these from the 2010 model, Kindle 3.0
iPad: Nearly 10 million sold in the US in less than a year
– We expect Apple to sell another 20 million domestically in 2011
– All but 2 million iPad 1.0 buyers will buy another tablet this year
Kinect: 8 million units sold globally in 2 months, 10 million since
launch
– Microsoft still has 40 million Xbox 360 owners to market Kinect to
– More than 50 million people will have tried a Kinect by year-end 2011
© 2011 Forrester Research, Inc. Reproduction Prohibited6
Are these products momentary anomalies?
NO
© 2011 Forrester Research, Inc. Reproduction Prohibited7
These successes are the product of a virtuous cycle that is enabling a digital life
1. How
we connect
© 2011 Forrester Research, Inc. Reproduction Prohibited8
Consider the connection facts
2006 2007 2008 2009 2010 2011 2012 20130
20
40
60
80
100
120
140
All US Households (mil-lions)OnlineBroadbandHome network*
Base: US households
*Source: The State Of Consumers And Technology: Benchmark 2009, USSource: September 21, 2010, “The State Of Consumers And Technology: Benchmark 2010, US” Forrester report
Half of online homes now have a home network
© 2011 Forrester Research, Inc. Reproduction Prohibited9
These successes are the product of a virtuous cycle that is enabling a digital life
NO1. H
ow w
e connect
2. What we connect
© 2011 Forrester Research, Inc. Reproduction Prohibited10
105.3
Types of
connected devices
Millions of
US adults
Base: 3,990 US online adults
Source: North American Technographics® Consumer Technology Online Benchmark Recontact Survey, Q2 2010 (US)
Multiple connected devices are now the norm
2+
3+
4+
5+
6+
7+
8+
79.357.737.022.113.38.0
9+
4.5
© 2011 Forrester Research, Inc. Reproduction Prohibited11
These successes are the product of a virtuous cycle that is enabling a digital life
NO1. H
ow w
e connect
2. What we connect
3. H
ow w
e ex
perie
nce
These products have not just changed our digital lives, they’ve changed the experience of every other product
© 2011 Forrester Research, Inc. Reproduction Prohibited12
We are entering the Era of Experience
• From the beginning of the Industrial Revolution, we have passed through two distinct eras:
• Now, in the new era, experience will• Differentiate you from your competitors, and
• Create distinct value for your customers.
The Era of Production The Era of Distribution
© 2011 Forrester Research, Inc. Reproduction Prohibited13
In the Era of Experience, digital products enable other, non-
digital products to be reborn as digital experiences
to be reborn
© 2011 Forrester Research, Inc. Reproduction Prohibited14
Hair
Eyes
Lips
Skin
Redo my…
© 2011 Forrester Research, Inc. Reproduction Prohibited15
Early examples of these experiences are already widely available
© 2011 Forrester Research, Inc. Reproduction Prohibited16
In the Era of Experience, we call these digital life moments Total Product Experiences
TOTAL: Extends the experience of a product
beyond its traditional boundaries
PRODUCT: Reinforces the product itself, not
just the brand
EXPERIENCE: Creates a new depth of
customer experience that is more:
– Persistent
– Meaningful
TOTAL:
PRODUCT:
EXPERIENCE:
© 2011 Forrester Research, Inc. Reproduction Prohibited17
Total product experiences depend on three elements
Device
Platform
Service
Together, these things enable total product
experiences that go far beyond our prior
expectations
© 2011 Forrester Research, Inc. Reproduction Prohibited18
Tablets will continue to advance at a rapid pace
15 million tablets worldwide at the outset of 2011
Forecast: 82 million tablet users in the US by 2015
© 2011 Forrester Research, Inc. Reproduction Prohibited19
Tablet users have fully embraced this digital life
Base: US online consumers (n=4587); tablet owners (n=210)
Source: Forrester’s North American Technographics® Consumer Technology Online Survey, Q1 2011 (US)
© 2011 Forrester Research, Inc. Reproduction Prohibited20
Game consoles are the next enabler
50
million
There are more than 120 million homes worldwide with connectable
game consoles
Depending on the market, half of these boxes connect to the
Internet, at least occasionally
The Xbox 360 Live community has 30 million members
50
million
85
million
© 2011 Forrester Research, Inc. Reproduction Prohibited21
Kinect is the Total Product Experience enabler for the home of the future
This $150 peripheral went on sale November 4, 2010
It provides voice control, face recognition, and 3D motion sensing
for the Xbox 360
Kinect goes far beyond gaming, giving people:– Voice control over video
– Video conferencing
– A deeper channel for marketing, sales, and anticipation of product experience
© 2011 Forrester Research, Inc. Reproduction Prohibited22
Kinect has a modest impact on product experience today
Gatorade sponsors Ubisoft
Fitness Evolved, a Kinect fitness
trainer
But there is no “virtual
experience” of Gatorade
Chevrolet’s got the right idea
with its Volt electric car, which
can be “driven” in a Kinect game
But where are the Kinect apps
that will enable a Total Product
Experience?
© 2011 Forrester Research, Inc. Reproduction Prohibited23
What do we learn from the home beauty mirror?
Social
Interactive
Rewarding
© 2011 Forrester Research, Inc. Reproduction Prohibited24
What Total Product Experience will you develop for the future?
How can you digitize your current interaction with your
customer?
What additional interactions could you have that weren’t
feasible before?
Are there any movements or visualizations that you
could simulate to make your total product experience
more compelling?
When can you take advantage of context?
© 2011 Forrester Research, Inc. Reproduction Prohibited25
Marketing and product will now expand into each other
Marketing Productoverlap
Promise Experience
Digital marketing simulates product experiences
Anticipation
Total Product Experience
© 2011 Forrester Research, Inc. Reproduction Prohibited26
Picking platforms for experimentation based on penetration, engagement, and audience size
US Penetration0 50mm
Wii
Xbox
360
PS3
iPad
Connected
TV
Non-
iPad
tablets
Xbox
w/Kinect
Leve
l of
Eng
agem
ent
5
4
3
2
1
50mm
Size corresponds to
how high the device
indexes for those
that spend big on
entertainment
100 - 125
125-149
150-199
200+
© 2011 Forrester Research, Inc. Reproduction Prohibited27
It’s time to take an active role
The platform providers are experiencing all the success
The app developers are reaping all the near-term
rewards
Product strategists and marketers are taking a back
seat to the development of the future
By pooling their resources, product and marketing
teams can create Total Product Experiences that win
consumers’ hearts and minds
© 2011 Forrester Research, Inc. Reproduction Prohibited28
What to do about it
Embrace the idea: All products will be reborn as digital product
experiences with the help of new digital devices and platforms
Look for opportunities to extend your product experience
– What devices might present new digital opportunities for product
discovery and engagement?
– What platforms are your customers on that you should build on?
– What services can you offer – what information can you deliver – that
will enhance the value of your product?
Pool your creativity and resources with product strategists and
product marketers to ensure that you have a shared vision of the
Total Product Experience you want to deliver
© 2009 Forrester Research, Inc. Reproduction Prohibited
Thank you
James [email protected]
jmcquivey
www.forrester.com
Follow me on Twitter