2. BrandX The end of Marketing The end of Marketing Sofie Vertongen Sofie Vertongen Pieter-Jan de Kroon Pieter-Jan de Kroon

3. Introduction BrandX BrandX Lifetime value of a consumer Lifetime value of a consumer Example: Coca-Cola Example: Coca-Cola Bidding war Bidding war The end of marketing The end of marketing Real life Real life Control Control Lets become millionaires! Lets become millionaires! Back to reality Back to reality

4. Would you sell your soul to a brand ? Would you sell your soul to a brand ?

5. BrandX Jeff Belle Jeff Belle Contract between consumer and company Contract between consumer and company Money in exchange for lifetime loyalty Money in exchange for lifetime loyalty

6. Lifetime value of a consumer Formula to calculate lifetime value of consumer Formula to calculate lifetime value of consumer Revolution in marketingworld Revolution in marketingworld Consumer: “ How much of my lifetime value is a company willing to share?” Consumer: “ How much of my lifetime value is a company willing to share?”

7. Coca-Cola : strategy BeforeNow Unit sales Percentage of your daily fluid intake Market penetration

8. Coca-Cola: the calculation 2 cokes a day 2 cokes a day 50 years 50 years We get €1,922.83 We get €1,922.83

9. Coca-Cola Wouldn’t just pay for the consumers who would have bought anyway Wouldn’t just pay for the consumers who would have bought anyway Intention : lure away Pepsi - drinkers Intention : lure away Pepsi - drinkers Paying for both the Pepsi - drinkers & the people how would have been loyal anyway Paying for both the Pepsi - drinkers & the people how would have been loyal anyway = Mass - market advertising: e.g. publicity = Mass - market advertising: e.g. publicity

10. Coca-Cola vs Pepsi Intention: lure away Pepsi drinkers Intention: lure away Pepsi drinkers Respond: offer own contracts Bidding war

11. Played out in creative financing rather than in advertising budgets Played out in creative financing rather than in advertising budgets - : producers’ margins - : producers’ margins + : consumers’ wallet + : consumers’ wallet + : less money on advertising + : less money on advertising ( Coke spent about € 2 billion in 2001) ( Coke spent about € 2 billion in 2001)

12. Loyalty contracts Loss of freedom of choice Loss of freedom of choice Consume same product over and over again Consume same product over and over again

13. The end of marketing Theory by Jeff Belle Theory by Jeff Belle When everybody has his loyalty contracts When everybody has his loyalty contracts Marketing will disappear Marketing will disappear

14. How to introduce it into real life? Exchange platform for the buying and selling of contracts Exchange platform for the buying and selling of contracts Comparable with stock exchange in NY Comparable with stock exchange in NY Here : Here : BrandX - stock exchange would determinate price of the contracts BrandX - stock exchange would determinate price of the contracts Bring buyers and sellers in touch Bring buyers and sellers in touch

15. How to control the consumer? Record & control the purchases Record & control the purchases BrandX credit card BrandX credit card

16. Lets become millionaires! Calculation of all contracts Calculation of all contracts Cereals, coffee, toothpaste, beer, … Cereals, coffee, toothpaste, beer, … € 50 000 € 50 000 Invest that for 30 years against 5% Invest that for 30 years against 5% € 500 000 € 500 000

17. Back to reality No proposals from companies No proposals from companies Only interest shown by consumers Only interest shown by consumers

18. Conclusion Advantages Advantages Money Money … Disadvantages Disadvantages Loss of freedom of choice Loss of freedom of choice … Worth considering Worth considering

19. Would you sell your soul to a brand? Would you sell your soul to a brand?