In this third of a four-part transcript, Ogilvy's Maria Mandel shares examples of building relationships with customers.

This conversation took place as a breakout session at February's iMedia Brand Summit in Florida. Read part one and part two, in which Mark Hughes, CEO of Buzz Marketing, describes the Buzz Marketing Model. Today, hear from the second panelist, Maria Mandel, Partner, Director of Digital Innovation, Ogilvy Interactive.

Maria Mandel: Hi. I'm Maria Mandel. I work for Ogilvy Interactive.

There’s reason why, it seems to me, the agencies are replacing interactive with a direct marketing strategy. Part of that is that what direct marketing does is it helps you bond with your consumers; helps you learn what the competitive set is; what’s going on in the marketplace. And then, how are you going to start building relationships with them through the various channels? 

The marketing landscape is changing and there are lots of new developments. Start with brand advertising, and television being one of the largest mass reach type of vehicles. We have DRTV, which is actually generating some response through TV. And then we started moving into more one-to-one type of communications, such as direct mail, PR and interactive, which was really used to target and find core consumers and get them to respond. But the line between these mediums is blurring and we’re starting to use communications such as û$)©ractive to both build brand and also generate a response.

I’m going to share two examples with you. The first, as John (Nardone, Executive Vice President- Product Development and Marketing, MMA) mentioned in the earlier session today, there are some brands that are classically better suited for direct response marketing -- high involvement type of products. So what I’m going to show you is an example from our Cisco Systems client, which actually started using the interactive channel for classic direct response lead generation type of programs. But they were able to significantly increase their return on investment by pinpointing messages specific to different target audiences. So here’s a quick case study. 

[VIDEO]

What you were able to see here was a global integrated campaign that had the message executed in different ways through online advertising and email marketing, using a combination of different languages, different types of messaging -- really leveraging the cost efficiency of the medium, but integrating a solid message throughout. And we were able to use this very cost efficiently to really generate some significant return on investment for Cisco.

Ultimately, in terms of an approach to take with integrating interactive into a direct marketing principle, it starts out with really defining who your target audience is, what are the relationship drivers? What are the key touch-points that are really going to make them react? And then developing the concept and the channels that you’re going to communicate with them; actually launching in market and testing, and continuously optimizing the program.

Anybody recognize this [shows a slide]? It’s a classic business school funnel for those of you who went to business school. It starts off with awareness, really generating awareness for the product. In the internet space that could be driving somebody from an ad to a website. Then comes consideration and preference, which basically tells them about your product, getting them interested in it. Lead generation is actually giving them incentives to purchase. And conversion is the actual purchase. And then the loyalty factor, in terms of keeping that relationship with that customer.

Look on the next slide -- this categorizes the different media channels that can be used for each stage of the funnel. And what’s great for us who work in the interactive space, if you look on the right-hand side, interactive in terms of both sites and emails is part of each stage and can be used in different ways.

I want to share a case study that’s a little bit different because when I was asked to speak about integrating interactive into direct marketing, you would expect for me to pick a high involvement type of product such as software or financial services or automotive. And I decided to use an example from consumer packaged goods because, to the point that John made earlier today, it’s not classically what you would think of as a direct marketing type of industry. And in fact, direct marketing wasn’t really utilized by a lot of CPG companies, primarily because of the high cost of using the channel.

So let’s share an example from Unilever with Home Basics that really shows how you can drive an increased customer value through creating an integrated direct marketing program.

What Home Basics was, it was a multi-brand initiative that had many different products participating. Some of them were home and personal care products, such as Dove, Suave, Thermasilk, Ponds, Snuggle. Others were food brands: Ragu, Lipton, SlimFast. It was a multi-brand approach that was really targeting the most valuable consumers. What they did was they created a solutions-based approach. To Mark’s [Hughes] point earlier, it’s really about defining what’s of value to the customers. And the key thing here is they took the approach that if you just advertise these products straight to consumers, they’re going to not really care about the products. You need to find something that’s of value. So they took the solutions-based approach where they created solutions for moms. And it developed into this win-win type of situation where they were delivering solutions the consumers wanted, at the same time delivering product information, and increasing awareness and purchase intent for these products.

All consumers aren’t equal. And Gerard [Broussard, Senior Partner and Director of Media Analytics for MOne] mentioned earlier the 80/20 rule in media. Well the same thing applies here: 80 percent of your revenue is driven by 20 percent of your consumers. This applies to consumer packaged goods. And so what Unilever rightfully realized is that they want to really cultivate their most valuable consumers because they’re driving, on average, $488 per household. These are significant value consumers. So how are you going to reach them effectively and increase the value of each household?

Who was the target? The target was a busy mom, 30- to 54-years-old with children in the household -- the high value consumer as we said; about $430 on average, per household. And she’s busy because she’s managing and juggling work and family life and she needs solutions. That was the key insight Unilever found. That was the big idea: really providing insights and help to mom in her busy life.

The program was an integrated online/offline program that provided solutions to mom for her home, family and self. And it came from brands that she trusted.

It launched offline. It actually launched as a magazine. And then from that it developed into an integrated program that created offline communications through a magazine, but also had emails, a website -- there were actually two websites initially. There was one for home and personal care and then one for food, which are now being combined into one.

So from the pilot it started off as a magazine, reaching several hundred thousand households, to now reaching over three million. Emails were segmented to their most valuable consumers so now we’re reaching about two million households.

The magazine was really centered around creating these solutions for mom -- it was a quality resource of information, breaking through the clutter of her every day and really providing her solutions that were meaningful to her life; also coming from brands that she trusted.

It was really a soft-sell message. It was editorial information. Again, Unilever didn’t want to hit the consumer over the head with brand messaging and coupons. This was really about creating solutions for mom, and solutions that happened to come from brands she trusted.

From an emarketing standpoint this was really a way to nurture the relationship. So yes, content was used from the magazine, but it was also tailored specifically to the moms and their needs. So what ecommunications allowed them to do was really get to know the consumer; because not all of these consumers are equal and each of them may have their distinct needs. One may be a busy mom who doesn’t really have time and needs easy quick solutions, and another may be a stay-at-home mom that has four kids and she needs to know how to manage her day with them. So what emarketing allowed them to do was really tailor the communication specifically to the target audience.

Really what was done here was the company got to know the consumers, through profiling them and segmenting them into different categories so that information could be served specific to their needs. It was really about understanding the consumer mindset. So for example, some moms really wanted to know about, you know, how can they find time for themselves, and different products that are suited for that. And then other moms really wanted to know how to find a nice quick easy meal solution.

And there was a lot of content. This is very important because this wasn’t one of these top-level sites that really didn’t provide anything of value. It was important to deliver on the promise. And the promise was to create valuable content that would be updated frequently. So it wasn’t one of these cog websites, if you’ve heard the term, that basically just has top-level information, never gets updated. This content was updated on a regular fashion.

And community was a very important aspect of these as well. This is something that emarketing was able to provide in the marketing mix -- was really not only talk to the consumer, but actually get feedback, and actually build this community. This was found to be very valuable because moms had this need to connect with other moms. The site really allowed them to do that.

Tomorrow: More details on Unilever's strategy, and questions from the audience for both Mandel and Hughes.