Xerox Premier Partner Meeting Dublin 2008 From Shamans to Surgeons, the new business model for the Printing business.

1. From Shamans to
Surgeons
The emerging new business model for digital
printing
2009
Javier G. Recuenco

2. Before start, two questions
How many of you have attended a
conference on the advantages of the use of
personalization in printing in the last five
years?
Agosto de 2008
How many of you are satisfied with the
commercial results obtained from the
translation of such conclusions to
your day-to-day work?

3. My opinion on personalized digital printing?
Infinite potential
Personalization issues : Trivialities and inaccuracies
There’s not an academic corpus of reference
Underutilized
Too stuck in the “comfort zone”
Agosto de 2008
Too stuck in the “comfort zone”
ICEBERG

4. I cry for every penny lost
Agosto de 2008

5. The efforts
Agosto de 2008

6. The Marketing drift
Agosto de 2008
Art Commercial

7. Show me the money!!!
Agosto de 2008

8. Where does the game get jammed?
Agosto de 2008

9. Let’s check the midfielders
Which is the
reason we
cannot make the
midfield work as
intended?
Agosto de 2008

10. Scenario
Agosto de 2008

11. Personalized marketing is sick
Agosto de 2008

12. With a little bit of imagination
Agosto de 2008

13. The Marketing drift, revisited
Art Science
Agosto de 2008
Art Science
http://sethgodin.typepad.com/seths_blog/2
009/05/is-marketing-an-art-or-a-
science.html

14. The bottom line
Agosto de 2008

15. La Percepción
Agosto de 2008

16. La realidad
Agosto de 2008

17. Is this a profile?
Agosto de 2008

18. A sistematic approach to profiling
Agosto de 2008

19. There Ain't No Such Thing As A Free Lunch
There Ain't No Such Thing As A sneaked profile
Agosto de 2008

20. ...unless, of course you belong to
Agosto de 2008

21. Trivial Use = Trivial Impact
Some shocking conclusions derived from our current studies
so far:
Over the total of relevant attributes (The ones who really have
an impact on the purchase process) used on a customer
model, sociodemographic data (The ones ussually available
and therefore the most used in segmentations) only
contribute with a 15%
Agosto de 2008
contribute with a 15%
Databases do not hold the needed information for generated
clusters being of any use, and they simply have value
against no segmentation, but they are clearly suboptimal.
Causing a smile is not the same than causing a durable
commercial impact. And loses effectivity with time.

22. Bring the contextual to the table
Usuario
Perfil
Atributos
Contextuales
Atributos que
identifican
macrotendencias
consolidadas o datos
Segmento
Segmento Protocolo
Asociado
A Segmento
Segmento de
valor vigente
Preselecciona
Dispara
Determina la pertenencia
SNAPSHOT:
Datos capturados de
un cliente en una
interacción con NH
Datos de perfil
Datos
Contextuales
Actualiza
Determina
Segmentaciones de Valor
Valoración
Parcial
Valoraciones Globales o
Ponderadas
Determina
Valoración
Parcial
Valoración
Parcial
Valoración
Parcial
Protocolo final a
aplicar
Protocolos
híbridos /
combinacionales
Puede disparar
Agosto de 2008
Repositorio de
Protocolos de Actuación
Usuario
Guia de Segmentación
Contextual
Contextuales
Atributos que
identifican tendencias
puntuales
consolidadas
Snapshot timeline
(Atributos
Contextuales)
Infiere
Genera
Contexto
Protocolo
Asociado a
ContextoPreselecciona
Taxonomía Contextual
Condicionantes
Contextuales
Dimensión
Principal
Contexto Posible
Contexto Posible
Contexto Posible
Contexto con sentido
de negocio
Contexto con sentido
de negocio
Limita
Genera
Potencialmente
Puede generar
Transiciones dinámicas
Contexto
Vigente
ESCENARIO B:
Segmentos de Valor no
preeminentes

23. Tuning Chart
Agosto de 2008

24. Step by Step
ABSOLUTE UNKNOWN
Behavioral / Semantic, Second degree
Clustering
Sociodemographic knowledge
Trivial Knowledge / Semantic, first degree
Agosto de 2008
MIND READING
Behavioral / Semantic, Second degree
Emotional, contextual and attitudinal knowledge with value in terms of taking
commercial decisions
Emotional, Contextual and Attitudinal Knowledge
Personal Privacy Aspects

25. A non-formal definition?
Harry S. Stamper (Bruce Willis), Armageddon, on
drilling:
“Drilling is an art. It has been running in my family for
generations. I have dedicated 28 years of my career
to it and I am still learning.”
It basically involves getting something pretty much
simple and intuitive (The capacity of adapting our
Agosto de 2008
simple and intuitive (The capacity of adapting our
product/service to customer needs in every
moment) which in truth, demands a lot of know how
and a bunch of different disciplines involved, as
we will see later.
There’s much more unwritten than written about
personalization.

26. The case for personalization
LAW OF OFFER AND DEMAND
Agosto de 2008
“There’s no such things as mature business, there are
business who have not applied personalization”
Pascual Montañés, IE professor

27. Does it have economic sense?
There’s a lot of money in democratizing
goods/products/services which were initially
available just for a chosen elite
Service democratization -> Low cost
Tourism democratization -> Globalia
Agosto de 2008
Tourism democratization -> Globalia
Hotel Quality democratization -> NH hoteles
Democratized access to differentiated and exclusive
Product / Services -> PERSONALIZATION

28. Which is MKT Holy Grail?
RELEVANCE
• We are consumers
• They are not offering us drugs or arms
What sets apart success from failure is that what we
are being told concerns us, and as a bonus, that
Agosto de 2008
are being told concerns us, and as a bonus, that
reaches us in the precise moment and through the
most adequate channel as possible
That’s the wet , secret dream of every MKT director
worldwide

29. An Example
Creating a TRIVIAL RELEVANCE
Balanced Recommenders: 10x money generated by
GOOGLE on next 10 years
Killer app of MKT, XXI century: TARGETED AND
PERSONALIZED ADVERTISING
Agosto de 2008
PERSONALIZED ADVERTISING

30. What about the ad agency?
Ad agencies have its own problems at the time being:
"Ahora mismo estamos perdidos, igual que el resto de colectivos de este
país", reconoce Segarra. [ ] "Fundamentalmente, se está
transformando el modelo de negocio", observa Segarra. "Estamos
pasando de una etapa donde accedíamos a un público masivo a otra
donde la audiencia se dispersa y fragmenta". Mancebo precisa otro
importante detalle: "Cambia el modelo de negocio porque ahora el
consumidor tiene voz. Nos replica, y de forma inmediata".
El Mundo, Reflexiones de los creativos españoles más importantes,
27/04/2009
Agosto de 2008
27/04/2009
Q: ¿Pero realmente hay un modelo de negocio en Internet? ¿Se puede
ganar dinero?
JLC: Se sabe cómo ganar, y hay algunos que lo hacen, pero los
márgenes son muy inferiores; y ése es el drama. Un site informativo
de éxito en Internet tiene márgenes de explotación del 4%. Un
periódico o una radio tiene un margen del 25% o del 30%. Es
imposible competir, pagar bien la mano de obra intelectual, enviar
corresponsales... Todos los modelos están montados respecto a un
sistema del pasado. Vivimos un cambio de modelo, no una crisis
Esquire, entrevista a Juan Luis Cebrián, 27/4/2009

31. What’s personalization?
A continuous process of
customer knowledge and
portfolio modulation that
allows us to suggest him
a personalized offer, in an
adequate communication
Agosto de 2008
adequate communication
context, with an objective of
achieving a state of
Commercial Intimacy
abypersonalize, 2003

32. Commercial Intimacy?
A final state, aspired by a
company with respect to their
customer, in such a way that
there’s enough knowledge,
prudence and trust for both
sides, and therefore there are no
Agosto de 2008
sides, and therefore there are no
commercial interactions which
turn out annoying, unsatisfactory
or just plain useless
abypersonalize, 2003

33. What’s the role of paper on this maelstrom?
Agosto de 2008

34. Let’s read the right way
Agosto de 2008

35. One idea: Transpromo
The idea is simply wonderful
Thousands of communications,
periodic, relevant and stored
Infinite potential for personalization
Agosto de 2008

36. The problem
Who in hell knows what makes this tick?
What works and what not?
Show me the money!
Agosto de 2008

37. The Industry need
Create expertise centers
Focus in awareness creation
Let’s desmitify
Let’s pilot the industry transition
Agosto de 2008

38. The Solution
1to1 Labs (Xerox & others)
Competence centers
Innovate
Awards and Symposiums
Traditional printing push to migrate to new
capabilities
Agosto de 2008
capabilities

39. The Solution’s problem
Agosto de 2008
Orkut

40. The true solution
Both the
customer and
the agency
cannot
Agosto de 2008
cannot
distribute the
needed game

41. The true solution
Strategic
Personalization
channels
Digital
Printers
Ad Agency
End
Customer
MKT
Printer
Ad
agency
Agosto de 2008
Personalization
Specialist
Printers
Customer
MKT &
Strategy
Ad Agency
Customer
Sales
Printer
Ad
agency

42. Ask yourself this question:
Agosto de 2008
Randy Swope, Xerox, 2008

43. If your answer was
A) A Direct Marketing specialist witn 30 years of experience in the DM sector
B) An Ad agency who has created a “hyperpersonalized” campaign with six
different segments
C) A Marketing professional who has a signed photo with Kotler and 30 years
of experience under his belt
Agosto de 2008
of experience under his belt
D) An specialist in WHAT?
E) A youg MBA
F) A printer who has a vague idea of the word and did once a calendar with
some customer names using XMPIE
G) One of The Dublineers after a whole Guinness rocky night

44. you’re dead
Agosto de 2008

45. The Example (I)
Hospitality leading company, 300+ hotels worldwide
Strategic Personalization project
10 years budget, building competitive advantage
around personalization
Horizontal, Cross- department initiative
Agosto de 2008
Horizontal, Cross- department initiative
Effective segment pre-work around half a year

46. The Example (II)
Impact at EVERY level in the company
Operations
Technology
Infraestructure
Agosto de 2008
Hundreds of personalized services to customer in
different hospitality environments and scenarios

47. HAS (Helpers, Aids & Services) : Son el conjunto de servicios que se pueden prestar al
cliente, bien para ayudarle en la realización de su cometido principal o para incrementar su
comodidad
ROOM: Todo lo que podemos experimentar en la habitación. Se divide en:
ROOM EXPERIENCE: Lo que llamamos experiencia “out of the box” – Lo que nos
transmite la habitación en los primeros 15-20 minutos de estancia
ROOM PLACEMENT: Dónde y cómo está colocada la habitación
The Example (III)
Agosto de 2008
46
ROOM PLACEMENT: Dónde y cómo está colocada la habitación
ROOM ENTERTAINMENT: Qué me ofrece la habitación en términos de entretenimiento
TREATMENT: Cómo quiere el cliente ser tratado en sus diferentes interacciones con el hotel
FOOD & BEVERAGE: Las preferencias del cliente en términos de bebida/comida
OPERATIONS: Cómo le simplificamos las operaciones clásicas del hotel
NON ROOM ENTERTAINMENT: ¿Qué me puede ofrecer el hotel como experiencia de ocio a
realizar fuera de mi habitación?
Y a todos estos aspectos les colocamos la coletilla “ que a mí me interese y tenga en cuenta
mi perfil y circunstancias en cada estancia”

48. The Example (III)
Dozens of perks make use of personalized digital
printing
Weather Forecast
Local Informative contents
International press headlines
Agosto de 2008
Ready to carry printed maps
Available preferred TV programming
Potential activities to be done report
Director’s choices report
Digital printing is a key channel in the
whole project, because it’s able to
support personalized, live and leaded
contents.

49. Translating the concept to transpromo
We need to work with the end customer creating
several needed items
Segmentation
PPM
Value Models
We can add a spark of creativity – as a spice, not as a
Agosto de 2008
We can add a spark of creativity – as a spice, not as a
main dish
IT’S NOT A MECHANISM TO TRANSLATE YOUR
BANNER TO ANOTHER CHANNEL
Tell a story!
Analyze, measure, polish, start all over again

50. The hard numbers
Average estimated return in direct campaigns with
some kind of basic personalization involved
(sociodemographic, clustering ) compared witn
traditional campaigns : 100-200%
Figures obtained from recent experiences (Tuenti,
Vodafone)
Our stimated return in terms of end to end application
Agosto de 2008
Our stimated return in terms of end to end application
of our methodology and technology built around
personalization :
3,000% as average!
Peaking at 5,000% (Luxury,
Fashion )
Those figures are not tiphographic errors

51. Conclusions: The needed change
Agosto de 2008

52. Conclusions: current situation
Agosto de 2008

53. Conclusions: Innovation
What drives Innovation: NEED
• Cutthroat competence
• Competition a click away
• Brutal price wars
Agosto de 2008
• Brutal price wars
• Paradigm Shift
• “Commoditization” – Pervasive Low-cost
• General Market Maturity
• VCR

54. Conclusiones: The times they are a changin’
• Media
– TV
– LIFE
– Hachette
– Press
Agosto de 2008
– Record Industry
• Digital Printing Business .

55. Conclusions: The strongest force in the universe
Agosto de 2008

56. Conclusions: Do not stick to trivial use
Agosto de 2008

57. Agosto de 2008
aby
1to1
javier.recuenco@abypersonalize.com