I-Marketing Interview: Cisco Systems – Part 1

At a time when computer network security is a top priorityfor many company executives, networking kingpinCisco Systems(Nasdaq: CSCO) is enjoying a spot at center stage.

The 18-year-old company inked nearly US$5billion in sales last quarter as it met steady demand for networkequipment.

Analysts view Cisco as a bellwether for thetechnology sector and even for the overall economy,and they are eager to extrapolate trends based on the firm’s quarterly reports.

A self-described “tribal elder” at the company, vicepresident of worldwide marketing communications JereKing, has overseen all of Cisco’s advertising and marketingactivities for six years. She recently spoke with theE-Commerce Times about Cisco’s unique advantage inonline advertising and about how the Internet saves hermoney and earns her customers.

Magic Medium

ECT: What advertising advantages does the Internetoffer that other media do not provide?

King: There are six features that make theInternet exciting. First, its immediacy. You can get amessage out very quickly without the two- to three-month lagtime you might have in traditional media, so it givesyou a time-to-market advantage.

Second, its ability tocreate an individualized dialogue with customers asopposed to a broad-brushed broadcast. Somebody can seean ad and respond to us easily, and we can respondback. This is exceptionally appealing to improvetargeting and segmenting.

Third, our ability to track it. It allows us to knowwho is interested and what they are interested in. Wecan follow their behavior and ensure their needs getmet, which is not as easy to do in other advertisingmedia.

Fourth, its ability to be global. We get asmany customers from outside the United Statesresponding to programs as we do from inside.

Fifth, cost. The Internet is typically a lower-costmedium. And sixth, it has wonderful capabilities thatcombine the best of broadcast and print. The Internetis capable of not just text or graphics. So, we can dosomething that is video-based, with audio, animationand a lot of power and emotion, if you have the rightbroadband infrastructure to support it.

Target Shooting

ECT: What steps, or series of steps, do you take whenplanning an online advertising campaign?

King: We take the same steps as we do in traditionalmedia. It is the basics of who do you want to speakto, what do you want to message. Fundamentally,you come to the conclusion of what is the right mediato reach that audience. Sometimes it is exclusivelyonline, and sometimes it is a combination of onlineand offline. I might reach some decision-makersoffline, but if I bring them online, there is so muchmore I can do with them. We often combine online andoffline activities.

ECT: Should an online advertiser choose many sites onwhich to advertise — or spend the same amount for alarger buy on one site?

King: We tend to choose fewer sites with broadercoverage versus many sites. Most online advertisingis, by its nature, very targeted. The online medium isfar more targeted and segmented than others. Based onthe results of our own campaigns, we know there are 10to 12 media properties that give us the majority ofgood, solid responses. If it is a focused,product-specific marketing program, chances are wewill be very targeted in the media we choose.

ECT: What process do you use to determine how much ofyour overall advertising budget is allocated to aparticular site?

King: We have lots of analyses and reports that lookat the yields from particular sites, what kind ofclickthrough rates we had, and the cost perclickthrough. We look at a lot of metrics over time,and ultimately we arrive at what we think is theappropriate amount of media to invest for theclickthrough and response rates we want back.

Bending the Box

ECT: What are the biggest challenges of marketing viainteractive media?

King: One challenge is getting good information on themedia buy. It is still in its infancy. You must makesure you have a skill set within your company thatreally understands the medium. Do not treat an onlinead as though it were just like a print ad. It isknowing how to optimize a medium that is still fairlynew. Most people did not do anything of any substanceor significance until the last several years. We areall still learning a bit.

Another challenge is that some customers are more usedto the Internet than others. Some businessdecision-makers are not likely interacting with theInternet as much as network administrators. You haveto vary what you do based on who you are trying toreach, and choose a medium that is comfortable forthem. In our favor at Cisco is that our core audience — network users and buyers — has a strong affinity forthe online world.

ECT: How well-suited is the Internet for brandingcampaigns?

King: I think it has limited appeal for overall brandbuilding. If you think you are going to buildawareness for your brand through a series of smallbanner ads, history has proven that does not work.Thinking more out of the box for building a brandonline is very important.

The projects that are mostsuccessful are joint sponsorships of Web sites whereyou build your brand awareness by offering a servicein sponsorship of another company so you can alignyourself with a particular service or product.

You should offer a service, or education, or something theconsumer really wants, so they can understand whatyour brand is all about. Banner ads assist with somebrand building, but they are very limited in what theycan communicate.

Herding Customers

ECT: How well-suited is the Internet for leadgeneration?

King: It is terrific. It has the promise and theability to interact with customers one-on-one, and itis infinitely trackable, so it is perhaps the bestmedium of all for lead generation.

ECT: What advantages have you gained through running abanner ad campaign?

King: The banner ads we run are normally linked into alarger, integrated program. For example, many customerstoday are concerned about network security because ofSeptember 11th and network viruses. We have run aseries of print ads, banners ads, online seminars,online technical talks and traditional seminars.

Banner ads are good at getting people out from wherethey are investigating information. They are very goodherding devices. A customer might be on a news sitethat talks about network security. If you can linkinto their interest at that time through a banner adbased on a keyword, you can drive them from that areaof interest back into your overall campaign.

ECT: What advantages have you gained through marketingin e-mail newsletters?

King: This has been a very effective approach for usbecause so many of our customers have opted in to stayup-to-date on subjects via e-mail. We have a highpercentage of very comfortable network users. Forthem, e-mail is efficient and direct. It goes right totheir mailboxes, and they can respond to itimmediately or pass it along to a colleague. And it is of little cost to us — maybe a penny or two per e-mail.

Go on to Part 2.