1_Introduction

[|Andreas Weigend] MBA 267, Spring 2009-B Haas School of Business, University of California at Berkeley
 * Marketing 2.x: The Social Data Revolution**

=Class 1: Introduction= March 19, 2009

Audio recording and transcripts are posted: Part 1: [|mp3] [|transcript] Part 2: [|mp3] [|transcript]


 * Class Notes**

**This course is called** **Marketing 2.x**. The reason? Marketing-based applications are in continuous evolution. For example, [|Amazon] is in continuous evolution to develop marketing strategies based on customer data. In marketing, like in any science (e.g. physics), what is important is to ask the appropriate questions to get the right kind of response. Applying this principle to marketing, using data generated on the web will lead to innovations on new applications which in turn generate more data. The big challenge for many organizations is how to get the appropriate data from customers, and how to use appropriate metrics to measure the outcome of a strategy. Historically, that is, before computers were able to process great quantities of data, models were "theory" rich and data poor. Today, processing capacity enables us to get rich data to associate information of, say, purchases, with the purchaser, thus enabling a closer connection between the data and the person. In a Web 2.0 context this means that today, customers go to [|Google] to get (and thus provide) information, so companies no longer own the customer. Social Media has gone mainstream now, and is impacting the way we live and work in dramatic ways. The individual’s voice is much more empowered now through social networks like [|Facebook]and [|Twitter]. One of the most common applications of social media is letting people rate their consumer experience. The reviewer can be an expert, or a layperson. The key component of making such reviews valuable is to build self-interest into the model.

What attracts people the most is knowing what they are going to get back for sharing their data. Knowing how you are doing is an important driver. Self-benefit is another important driver. Self interest adds another dimension to Web 2.0 given the relevance of getting truthful information. Some airlines, historically had poor management of information. Data was obtained by capturing customers' information in unappealing ways, and there was little incentive for the customer to provide information.
 * Why people do things in Web 2.0?**

Shopping is the process of creating, maintaining and refining product space awareness. This is what Amazon champions on the Web. Ten years ago, people perceived switching from one website to another costly or burdensome. Today, this has changed. As said before, companies acknowledge they don’t own the customer. Today, it is the customer who has the power (and burden) of choice What is more interesting is that companies do not own their product anymore as spinning is a matter of the past; this has great effects on marketing. Maybe more importantly, brands are losing power as its ever becoming harder to influence people on brands using old media techniques; social media allows customers to shape the brand. This is what is called the [|Social Data Revolution].
 * The concept of Shopping.**


 * Companies no longer own the customer or the product as they did before the social data revolution. Customers have access to more information on the web than any company could provide on their own website. Google offers access to just about any information a customer wants. In addition, a customer can now find several reviews of products online, and can rely on that to make decisions about products. The output of a company’s marketing communications is no longer the primary source of information that customers use to make choices. It is therefore critical for companies to understand how social media is evolving, and follow their customers as the social media landscape changes rapidly.**

Companies have to find ways to engage customers within the new paradigm of social media. How do companies get customers to provide sincere feedback? How do companies disperse information so that they reach their target audience?

What is the essence of Web 2.0? How did we get there? How does marketing has to chance in response?
 * Objectives of the course include:**

