Professor Michael Solomon is an expert in consumer behavior and marketing. He has published extensively on topics related to consumer behavior, branding, and digital engagement. In this document, he discusses how digital technologies have empowered consumers to become more engaged with brands in new ways. Marketers must shift from treating consumers as passive "couch potatoes" to seeing them as active participants in brand meaning and marketing activities through user-generated content and virtual interactions. Consumer engagement through digital channels can result in higher profits if brands facilitate consumer participation and co-creation.

1. DIGITAL ENGAGEMENT Michael R. Solomon, Ph.D. Professor of Consumer Behaviour Manchester Business School Professor of Marketing and Director, Center for Consumer Research Haub School of Business, Saint Joseph’s University, Philadelphia U.S.A. msolom01@sju.edu November 2009

2. ABOUT THE SPEAKER Michael R. Solomon, Ph.D. is Professor of Marketing and Director of the Center for Consumer Research in the Haub School of Business at Saint Joseph’s University in Philadelphia. He also is Professor of Consumer Behaviour at the Manchester School of Business, The University of Manchester, U.K. Dr. Solomon has published numerous articles on consumer behavior, lifestyles, services marketing, and fashion psychology, and he is the author of Marketing textbooks that are used in business schools around the world. He is the author of Conquering Consumerspace: Marketing Strategies for a Branded World(American Management Association) and The Truth about What Customers Want (FT Press). Prof. Solomon has worked with numerous corporate clients on issues related to consumer behavior, branding, services marketing, retailing and advertising. He appears on television shows such as Good Morning America and The Today Show to comment on consumer behavior issues. He has delivered keynote addresses at many trade organizations and corporate meetings in the U.S., Europe, Latin America and Asia. msolom01@sju.edu 610.660.3411

3. The Holy Grail: Lure the Reluctant Consumer

4. Multitasking: Combining Shopping, Entertainment, Work

5. ENGAGEMENT = ROI 75% of executives say higher levels of customer engagement would result in higher profits 49% think inadequate engagement is to blame for up to 25% of lost sales. The Economist, March 2009

6. Brand Equity Model Engagement BRAND RESONANCE CONSUMER FEELINGS CONSUMER JUDGMENTS BRAND PERFORMANCE BRAND IMAGERY BRAND SALIENCE Adapted from Kevin Lane Keller, Strategic Brand Management, Irwin McGraw-Hill, 2003

12. Loyalty Attachment Community Flow State

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14. THE NEW CONSUMER MINDSET

15. Marketer Consumer

16. The consumer as“couch potato”

18. WELCOME TO CONSUMERSPACE

20. In consumerspace, people want to be part of the marketing process…

22. Cultural Co-Creation Co-created meanings fold back into the culture and become part of the social discourse. Jones soda, for example, enlists its consumers’ input on packages and flavors 22

23. Link to Cultural Myths

24. CONSUMPTION RITUALS BBDO: “Fortress brands” embedded in rituals are difficult to replace. About 90% of consumers worldwide use the same brand each time they perform a ritual!

25. Evolutions in Branding Theory and Research: Three Steps Forward FROM: Brands as assets created and controlled by the firm Brands exist in the minds of consumers “What brands mean” TO: Brands as co-created entities Brands live in cultures How brands come to mean; brand development mechanisms and processes Fournier, Susan G., Michael R. Solomon, and Basil G. Englis, “Brand Resonance,” in Schmitt, B.H. And D.L. Rogers (eds) (2008), Handbook on Brand and Experience Management, Cheltenham, UK and Northampton, MA, USA: Edward Elgar.

26. THE CGC BOOM

27. Consumer-Generated Media (CGM) The Infamous Mentos - Diet Coke Experiments

28. Doritos CGC

30. Accenture survey: Media and entertainment executives see the ability and eagerness of individuals to create their own content as one of the biggest threats to their business. 57% identified the rapid growth of user-generated content as one of the top three challenges they face today.

31. Risk Vs. Control But: 68% of the respondents said they believe that within three years their businesses will be making money on user-generated content!

32. The Bottom Line: You don’t own your brand anyway. GET OVER IT

33. CGM ≠ CGC! Consumer-generated MEDIA Custom pricing Viral distribution New product development Product personalization Customer insights Advertising New media Consumer-generated CONTENT

34. Consumers Become Marketers Directors: Britain’s Got Talent TiVo Ford Probe commercial – viewers pick the ending Player-cams follow individual athletes during football games Apple: Viewers post their own commercials Retailers/ Distributors eBay Amway Kazaa, Grokster, etc.

35. DOMAINS OF CGC

37. Consumer-Enabled Distribution (aka Viral Video)

38. www.subservientchicken.com

39. Consumer-Generated Pricing

40. NPD and Customer Insights

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42. Prediction markets

43. hsx.com

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53. Virtual Worlds

54. Virtual Worlds

55. ©2007Michael Solomon 55

56. SOCIAL IDENTITY IN CYBERSPACE Natalie

57. Physical/Digital Identity Management

58. Before

59. Some residents use real identities…

60. Others not so much…

61. Selecting an appropriate avatar for a web site may be just as important as selecting the right model for an advertising campaign…

62. Through the Looking Glass?

63. Offline to Online

65. TastyDiamondz tells me how she is shy in real life, but VMTV helps her to overcome this shyness.

67. The Disabled

68. Online to Offline

69. Proteus Effects

70. Cosplay

75. Sales Training

76. See behaviors from 3rd person perspective

77. Integration!

78. Welcome to AUGMENTED REALITY

81. Promotes unity between your true and virtual identities. You can upload real footage onto a virtual TV in your virtual apartment, and share your real videos with your virtual friends.

82. …Let your customers tell you!

83. THANKS FOR LISTENING!