Transformational Marketing Automotive News World Congress Jan Thompson, VP Marketing Nissan North America January 18th, 2006

2 Radical times demand radical changes in marketing Radical transformation in technology is taking place and will only continue to accelerate “The Law of Accelerating Returns” Source: The Singularity Is Near, Ray Kurzweil

3 Radical times demand radical changes in marketing The traditional hierarchical marketing model is no longer as effective Demographic Shifts Technology Advances The Democratization of Content and Media Meshing Impact on Costs

4 Millennials or Generation YGeneration XBaby Boomers Radical times demand radical changes in marketing Demographic and Cultural Changes

5 Source: Marketing Leadership Council, 2005 Radical times demand radical changes in marketing Technology Advances The Proliferation of Media Channels

6 Radical times demand radical changes in marketing The Long Tail - as it applies to the automotive industry More nameplates with lower volumes than ever before All products have an opportunity to capture consumer awareness due to the number of media channels available * The Long Tail concept from Wired Magazine, 2004

7 Download some photos from the show as wallpaper onto a Sidekick II phone/internet/ /instan t message/camera device Radical times demand radical changes in marketing The Democratization of Content and Media Meshing Playing Project Gotham Racing 3 on Xbox with Nissan URGE concept car Chatting on Xbox Live about the iPod connector in the URGE A little more interested in the model, off to check out any Auto show pictures on My Space blogs Downloads a cool Podcast with a review from a guy in his My Space group that went to the Auto show. Edmunds.com message boards to see what other people are saying about the Nissan URGE Click on banner ad to check out Nissan URGE microsite, sign up for next podcast

8 Radical times demand radical changes in marketing Impact on Costs Audience fragmentation : 6 channels on average : 100 channels on average* Prime time CPMs have increased dramatically : $7.64 CPM** $19.85 CPM Network TV viewership has declined almost 50% over the last 30 years** Source: *Forrester, “What’s Next for TV Advertising” December 2004; ** Advertising Age “The Chaos Scenario” April 2005

9 Radical times demand radical changes in marketing Million 14.5 Million Billion 700 Million Number of ModelsIndustry SalesAdvertising Spend 17%68% What does this mean for the Automotive Industry? The Automotive industry spends more than any other category… , Wards Automotive Yearbook (1985), 2005, Automotive News Data Bank (2005) 1378%

10 Traditional Model Comparison of Marketing Models Planning Objective: Communications goals based on reach/frequency Targeting Method: Mass mediums focused on large, undefined segments Measurement: Ad tracking metrics like awareness, brand opinion, TRP and CPM Planning Objective: > Brand Transformation > Channel Integration > New Media metrics Targeting Method: > Detailed consumer insights > Embrace media meshing > Enable peer networking Actionable Business Intelligence: > Full funnel focus > Data Modeling > KPIs, ROI & CLTV TestMeasureRefine TestMeasureRefine Transformed Model

11 Search One of the biggest drivers of transformational marketing It is evolving quickly: - Audio search - Video search - Geographic search - User generated content search Radical times demand radical changes in marketing - * ClickZ, 11/2005 $8 Billion $22 Billion The Search Transformation

12 - * ClickZ, 11/2005 Radical times demand radical changes in marketing Search is a significant part of our media mix Nissan Summer Sales event paid search results: - 34% of all web traffic to NissanUSA.com - 31% of interactive sales tracked to search activities - ROMI of $31.82 returned for every dollar spent

13 The Transformed Marketing Company To achieve this transformative model internal and external factors must be addressed…

14 Managing for Success Re-examine and re-organize internal organization The Transformed Marketing Company Clear Brand Vision What Who How Relentless focus on the Consumer Manage the Consumer Experience

15 The Transformed Marketing Company Managing for Success - Internal Organization Subject Matter Experts - Search - Data analysis and modeling - Business Intelligence New OEM communication strategies must be aligned with regional and dealer strategies OEM RegionsDealers Create a consistent and integrated dialog with the consumer

16 The Transformed Marketing Company Managing for Success - External Organization Re-examine and re-organize external organization Client Lead Agency Agency Client Agency Traditional ModelTransformational Model

17 The Transformed Marketing Company Seven keys to transforming your marketing: 1.Know what you stand for and relentlessly execute against it 2.Learn fast and adapt quickly 3.Create an action oriented culture 4.Structure internal and external organizations to align with the new communication paradigm 5.Start with the Idea, not the buy 6.Aggressively innovate – it’s not how much you spend, but how you engage your target 7.Embrace accountability