Science of Nurture Session 1

2 Agenda IBM’s journey to Personalized MarketingJ. Gargan Science of Nurture OverviewJ. Gargan Nurture Context and DefinitionA. Gosling

3 Marketing Built Around the Individual ObservationImplication Marketer’s have always observed, listened and researched to learn about heir customers. Compelling insights into market segments are the starting point for brilliant campaigns Marketing automation is transforming our profession. Interconnected systems are providing data today as never before - revealing patterns of marketing interactions which successfully create leads and help to efficiently progress opportunities Technology proliferation is explodingThe world becomes ever more dependent upon personal devices, digital media, and on-demand services Buyers are more prepared than ever and expect personalize engagements. We must know them across all touch points and meet their expectations B2C companies have been at this for years, B2B companies are working hard to get there

4 What is personalized campaign marketing? What is personalized marketing? Tailored marketing interactions to individual characteristics and preferences…. ….Resulting in improve relevance by meeting the customer needs more effectively and efficiently, making interactions faster and easier How do we need to evolve our campaign capabilities to get there? Transform our data by capturing individual preferences under an established governance Enhanced offer management and delivery –Offer design and testing –Offer library, offer taxonomy Develop deep expertise in targeting, buying agenda and campaign design Enhance current Unica system to improve LDR effectiveness, deploy new nurturing capabilities and automate personalized web interactions

5 Early Steps in Personalizing our Campaigns Client’s engaged with personalize web experiences and aligned offers Clients receive tailor information / offers based on individual behavioral insights Client’s choose what information they want and how they receive it Intelligent rule based system learns over time to select best offer Offer delivered based on client relevant geography and language zones Real-time measurement at offer and visitor levels Today, an individual can only opt-in or opt-out of all IBM Communications Granular opt-in / opt-out puts client in control of interests information delivery Avoids opt-out triggers End generic 3-touch nurturing Customized to each buying stage Planned, sequenced and continuously refined Predictive offer performance analysis October, 2012 August, Q 2013 Granular Opt-in / Opt-out Automated / Customize Nurturing Unica Interact

6 Customized Nurturing Educate DP/MSM to deliver personalized offers based on preferences & behavioral insights New Marketing Roles DbM Nurture Strategist, transform MM/DP into Demand Management discipline New Content Management Application of brand differentiators, Blueprint taxonomy and API for management New Labor Strategy Leverage regional marketing centers and redefine WW/IMT skill base Offer Creation & Management Offer repository and library tailored to preferences and buyer’s journey New Unica Modules Personalize web content delivery via Unica Interact Unica Planning – workflow enablement New Unica Capabilities Nurture map flow charting, LDR call queues via advanced response scoring Personalized Marketing Requires Transformation Enabling Technologies Nurture Planning Standardized best practice for Science of Nurture, learning to deliver the right information at the right time Persona & Buyers Journey Common methodology, development of +100 Personas, consistent application of buyers journey and hurdles New Approach to Briefs Planning for interactions and system of discipline briefs New Campaign Process Ready-to-execute campaigns Process and Methods Skills Transformation MdB Transformation Expand to include contact personal preferences and behaviors

7 Transforming IBM’s marketing capabilities requires focusing on 5 keys areas 7

8 Ready to Execute responsibilities Design/Plan Campaign WW RTE Teams Execute Campaign Country or GMC Teams Manage Campaign Everyone Create Campaign Overview Design/Plan Campaign Define Audience Segmentation Develop Offers & Assets Create Digital Content Plan Events Design Initial Response Touch Design Nurture Streams Align with Sales & Enable Select Channels & Enable Define Response Lead Management Plan Output: Campaign Map, Performance and Budget Plan Create campaign and tactic codes in planning tools Use Campaign Map to create flowchart and launch campaign Publish web/digital content Capture response data Execute Event and upload attendee information Train and enable LDRs Inform and enable Sales Channels Review response performance Analyzing conversion percentages Conduct root cause analysis Adjust campaign design and execution

9 SCIENCE OF NURTURE

10 What is Science of Nurture Science of Nurture it the strategic method by which we are going to advance our nurture capabilities from being process driven (3-touch) to being client driven (personalized marketing)

11 Science of Nurture Education What it IS Comprehensive education around a strategic METHOD of planning personalized nurture. This education is around the strategic development of nutrure What it IS NOT Training around the use of the Unica tool. You will not see the tool, or be trained on the requirements of the tool during this training Only DBMs will be required to operate the tool to execute the strategies developed as a result of this training

12 In order to achieve this, we need education Session 1: Putting Nurture into Context and Defining Nurture Framing nurture within the overall marketing transformation Session 2: Identifying Objectives and Target Audiences Using the Buyer Journey and Personas Introducing methods that we will use to ensure client centricity Session 3: Defining Content and Asset Needs Demonstrating how to evaluate content for quality and align it to client’s needs and preferences Session 4: Capturing Response and Scoring The importance of the experience of response capture, and advancing our scoring capabilities Session 5: Testing and Performance Optimization How to embed testing into your nurture streams & what to test Session 6: Constructing Nurture and Changes in the Demand System How to plan out a nurture stream to pass to the DbM and what changes enable this capability

13 Session One: Putting Nurture into Context and Defining Nurture

14 1. PUTTING NURTURE INTO CONTEXT

15 IBM has an aggressive 2015 growth target In 2015 Software contributes nearly half of our segment profit Growth initiatives deliver $20B in revenue growth Growth markets’ revenue approaches 30% of IBM’s total Enterprise productivity delivers $8B in gross savings IBM generates $100B in free cash flow, returning 70% to shareholders Hardware/FinancingServicesSoftware Operating PTI/EPS Segment Operating PTI Operating EPS At Least $20B At Least $13.25

16 Deliver high-quality validated leads to Sales – from both established clients and net new accounts Quantity Assist Sales to win, to win bigger, and to win more often Quality $1 billion Average shortfall 20% Pipeline yield Historical pipeline starting position and resulting yield will not enable us to meet our 2015 Roadmap goals

17 Until 2011, our answer to increasing pipeline opportunities was to increase messaging activity Millions Marketing Tactics

18 With the transformation of the IBM Demand System encompassing three areas: Use what makes our brand unique to increase the quality of our work Align Marketing & Sales across the end-to-end system Make the way we generate and manage demand truly “smart” Execution that is distinct from competition will drive greater yield from existing pipeline. Includes: Adoption of MAP segmentation Consistent RTM and enablement Campaigns linked to sales plays Common quarterly calendar Includes: Deployment of Unica Agile methods Data and analytics

19 Nurture is aligned to our Demand System goals Nurture is part of the end-to- end system and will build collaboration with Sales by ensuring that the responses most likely to convert to opportunities are passed to an LDR Nurture is the means to make our case with expertise and proven outcomes and provide opportunities for collaboration MAT is the facilitating technology that enables Nurture delivery in support of campaigns and Sales Plays Demand system goals Nurture alignment Build an end-to-end system that has operational rigor and collaboration with Sales at every point Leverage the IBM brand differentiators to drive quality and increase yield Fully leverage technology to make the way we manage demand truly smart

20 This alignment then drives our actions Demand system goals Build an end-to-end system that has operational rigor and collaboration with Sales at every point Leverage the IBM brand differentiators to drive quality and increase yield Fully leverage technology to make the way we manage demand truly smart Nurture alignment Focus on our target clients, instead of on our products, technology or internal processes Design our content to communicate what a client needs to understand vs. what we want to sell Define Nurture beyond eNurture and employ a rigorous client focus across all client touch points What we need to do Nurture is part of the end-to-end system and will build collaboration with Sales by ensuring that the most likely to convert to opportunities are passed to an LDR Nurture is the means to make our case with our proven outcomes and expertise and provide opportunities for collaboration MAT is the facilitating technology that enables Nurture delivery in support of campaigns and Sales Plays

21 If we do this, we will achieve Increase in wins Increase in response to Validated Lead conversion rates Increase in Sales Accept rate