1. Digital Consumer Trends

2. Where Are We? Technology Peak of Trough of Slope of Plateau of Trigger Inflated Disillusion Enlightenment Profitability Expectation 1990-1996 1999 2000 2001 2002 2003 2004 2005 2006 Equity times Debt Times Positive Cash Flow Visibility Dot-com peak U.S. Recession E-Business becomes “just business” Source: Gartner Research

3. Market Overview 938 million users worldwide (14.6%) Developed nations = 15% of the world’s population = 88% of all Internet users U.S. Internet users = 202 million (69 penetration%) 60% of the world’s population say they will never have a use for the Internet http://www.internetworldstats.com/stats.htm

4. Just over 60% of Americans went online in 2002 spending 11 hours/week (vs. 8.5% of world pop.) E-commerce is 5% of all retailing -- $969 million in one week (8/3/2003); up 27% from 2002 Source: Business 2.0

5. What We Do Online Almost 2/3 of Americans go online. The top 10 things they do online are: Activity% of Internet Users Send e-mail91% Use search engine to find out information88% Research product/service before buying83% Internet search to answer specific question80% Search for map/driving directions79% Look for info on hobby/interest76% Check the weather75% Look for info on movie/book/other leisure activities73% Get news69% Search the web for fun67% Source: Pew Research Center, Report on Internet Activities, http://www.pewinternet.org/reports/chart.asp?img=Internet_Activities_1.14.04.htm http://www.pewinternet.org/reports/chart.asp?img=Internet_Activities_1.14.04.htm

6. Seven Emerging Trends 1. Individuals' interconnectivity is increasing. 2. The information playing field is being leveled. 3. Relevance filtering is growing 4. Niche aggregation is growing 5. Micropublished self-expression is blossoming 6. The "prosumer" is rising 7. It's on-demand everything, everywhere Source: http://www.clickz.com/experts/brand/capital/article.php/3510081http://www.clickz.com/experts/brand/capital/article.php/3510081

7. Challenges Digitally empowered customers are harder to find and attract Audiences filter through the abundance of available information, seeking personally relevant content Individuals spend more time interconnected with peers Digitally empowered consumers expect more and are hard to satisfy Source: http://www.clickz.com/experts/brand/capital/article.php/3520841http://www.clickz.com/experts/brand/capital/article.php/3520841

8. How to Build Closer Relationships Marketers must shift their strategic thinking Invite your audience to participate in your campaigns – e.g. Dove’s Campaign for Real BeautyCampaign for Real Beauty Allow customers to co-create – e.g. Sony Playstation’s Freedom campaignSony Playstation’s Freedom Enable and facilitate connections among your audience – e.g. GM’s FastLane BlogGM’s FastLane Blog Hand over control to consumers wherever possible