Whitepaper the implicationsofthesplinternet-webtrends

A Forrester Consulting Thought Leadership Paper Commissioned By Webtrends
The Implications Of The Splinternet And Future Of
Web Analytics
September 2011

Forrester Consulting
The Implications Of The Splinternet And Future Of Web Analytics
Page 1
Table Of Contents
Executive Summary.................................................................................................................................................................................2
The Current State Of Digital Marketing .............................................................................................................................................2
The Splinternet Is An Equal Opportunity Disruptor........................................................................................................................3
The Solution..............................................................................................................................................................................................7
Key Recommendations.........................................................................................................................................................................13
Appendix A: Methodology ..................................................................................................................................................................14
Appendix B: Demographics/Data.......................................................................................................................................................14
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Page 2
Executive Summary
In May 2011, Webtrends commissioned Forrester Consulting to study the phenomenon frequently referred to as the
“Splinternet.” In conducting in-depth surveys with 210 global, senior-level digital marketers across industries, Forrester
found that many marketers are struggling with the fragmentation of technology standards and customer touchpoints
across proprietary digital platforms and devices.
Key Findings
Forrester’s study yielded three key findings:
 The Splinternet disrupts the marketing landscape. Technology and channel fragmentation are a very real
phenomenon; marketers know that adapting to a multichannel environment is critical and are racing to
understand the effect of the Splinternet.
 Marketing strategies need a reboot. Firms must take a fresh look at their foundational strategies to evaluate how
they will create mutually beneficial relationships with customers in light of new channels, technologies, and the
expectations of sophisticated consumers.
 Multichannel success requires mastery of multiple disciplines. Firms must take a multidisciplinary approach to
harnessing the opportunities that the Splinternet presents. Technology, organization, process, and measurement
are all interrelated contributors to a marketing organization’s effectiveness.
The Current State Of Digital Marketing
Marketing is going through a period of rapid and significant evolution. The era of an easily compartmentalized Internet
— comprising the web browser, well-defined touchpoints, and open technology architectures — has been usurped by
the Splinternet, a large-scale fragmentation of devices, data access, and technology standards. The Splinternet has an
expansive effect because it breaks many of the foundational assumptions upon which digital marketing is based:
 Connected devices go beyond the PC. Smartphones, Internet-connected devices, and new devices such as tablet
computers create a diverse world of connected, overlapping devices. Customers are now capable of being online
24 hours a day, raising the bar for original and creative marketing content, but also providing firms with ample
opportunities to establish a relationship.
 Social media inverts data ownership. Consumers generate more data than ever, but they are retaining control of
that information. Social networks retain control of data based on personal networks and password-protected
sites, ultimately withholding massive sources of insight from digital marketers. This changes the balance of
power for the control of data.
 Marketing standards shift. As touchpoints diversify and platform vendors assert control over access and
technical standards, marketers must adapt to a strategy of marketing in a world of walled gardens. Each
touchpoint requires its own technology, processes, and measurement strategy.

Page 3
 Everyone is an analyst. As channels and customer touchpoints increase, marketing has become a highly
collaborative environment. More stakeholders in the business need access to marketing insight than ever before.
Firms need to provide marketing stakeholders with relevant and timely reports and analysis to support
decision-making.
The Splinternet Is An Equal Opportunity Disruptor
The survey findings make it abundantly clear that the Splinternet is a real and pervasive phenomenon that affects firms
of all sizes, geographies, and industries. As a result of this great equalizer, nearly all firms are affected by technology and
touchpoint fragmentation, and they face a marketing landscape of remarkably similar challenges and opportunities:
 Multichannel marketing is critical. Firms reported a high-level understanding that multichannel holds value.
This recognition extends to both benefits for companies in terms of sales and profits as well as satisfying
customer expectations (see Figure 1).
Figure 1
Firms Grasp The Importance Of Multichannel Marketing, But Big Changes Are A Bit Harder To Make
Base: 210 North American and European marketers
Source: A commissioned study conducted by Forrester Consulting on behalf of Webtrends, July 2011
“To what extent do you agree or disagree with the following statements about multichannel
marketing?”
19%
23%
30%
26%
27%
37%
31%
37%
36%
33%
37%
38%
46%
48%
42%
50%
47%
49%
33%
27%
20%
19%
22%
18%
16%
13%
11%
14%
11%
10%
8%
3%
3%
1%
3%
4%
2%
1%
2%
1%
0% 25% 50% 75% 100%
Our organization must change dramatically to enable becoming a
multichannel company
A multichannel customer is worth substantially more to us than a
single channel customer
Our company must rethink how it services customers to become a true
multichannel company
In the future, our multichannel strategy will be a key factor in how we
develop products and services
In the future, our multichannel strategy will be a key factor in how we
invest in technology to support our channels
Being an effective multichannel company will be critical to our long-
term success
Customer expectations for cross-channel or multichannel relationships
with companies and brands have changed dramatically
We will drive more sales and profit by becoming a multichannel
company
To serve today’s customers, we have to improve our multichannel
capabilities
Completely agree - 5 4 3 2 Completely disagree - 1

Page 4
“Customers want everything to be the same across all touchpoints and devices. Customers also expect everything to
be available instantly. They send an email and expect a response within hours not days.” (Marketing Executive,
Retail)
“It is starting to get to the stage where we offer promos and marketing campaigns to individual people in
organizations. That segmentation becomes incredibly complicated. Some want an email, some want text, some want
to do collaboration sessions online. Channels have become incredibly complicated. If you connect to people through
the wrong channel, it can be a relationship breaker.” (Marketing Manager, High Tech)
 Social media dominates share of mind and wallet. Emerging channels are a major fixture and cause of
fragmentation driving the Splinternet, most notably social and mobile. Firms reported that they are most active
in social networks when expanding beyond traditional interactive channels, often at the expense of other
channels such as mobile (see Figure 2).
Figure 2
Social Is Soaking Up Marketers’ Attention
“As far as digital marketing, generally I direct digital marketing that supports our stores from [microblogging sites],
[social media sites], email, and website enhancements. We do not do mobile at all currently. It’s beyond our current
capacity. We don’t have the staffing for it. It is literally beyond our capacity.” (Marketing Manager, Retail)
 Measurement issues create a self-defeating cycle. Firms reported that measurement is a top challenge for
adapting to fragmentation. The failure of measurement to keep pace creates significant barriers to adoption for
“Beyond traditional interactive channels such as search and website marketing, in which emerging
channels is your company currently conducting marketing activities?”
79%
56%
54%
52%
41%
34%
30%
26%
13%
12%
2%
Company presence in social networks
Company advertising in social networks
User generated content such as blogs, reviews, ratings, etc.
Mobile applications
Mobile web browsing
Mobile messaging such as SMS
2d barcodes
Tablet computing
Games
Kiosks
Other

Page 5
marketers because respondents simultaneously indicated that uncertain ROI is the top barrier to adopting new
channels in their organizations (see Figure 3). The source of this issue lies in the fact that most firms only
measure basic metrics rather than deep, business-oriented key performance indicators (KPIs) (see Figure 4).
Figure 3
Proving ROI And Lack Of Budget Create A Vicious Cycle Of Barriers
Base: 210 North American and European marketers (multiple responses accepted)
"Please indicate the barriers, if any, that prevent your marketing organization from adopting new
channels?"
49%
31%
31%
23%
22%
21%
19%
13%
12%
12%
11%
4%
3%
1%
Uncertain ROI
No budget allocation
Company bureaucracy
Cost is too high
Unfamiliarity with appropriate technologies and vendors
Data security risks
Lack of skills and resources
Difficulty working with ITor external partners for…
Legal issues
Lack of executive support/sponsor
Concern about negative feedback from customers
None. There are no barriers.
Negative feedback from within the company
Other

Page 6
Figure 4
Firms Are Measuring But Long-Range Key Performance Indicators Lag
“We don’t have specific metrics at this point. The driver to our social work is that you know you need to be in certain
places, targeting certain group of consumers, just haven’t figured out if we’re reaching them thoroughly and
measuring if impact is turning into sale or brand awareness. We’re seeing where our brand awareness is, but it is
hard to break out which part of our marketing dollars are pushing those levers.” (Marketing Executive,
Manufacturing)
“I don’t think we know what constitutes success with our social programs. We don’t have any traditional
measurement tools beyond measuring activity on pages. We have not been able to link activity to sales in any way.”
(Marketing Director, Consumer Packaged Goods)
“Online marketing is being used more and more to justify offline marketing. This is a resource drain to the digital
marketing team, and it isn’t an exact science, also it creates more arguments over attribution. Brand marketers see
their budgets dropping and are desperate to justify their activities.” (Marketing Executive, Retail)
 It is easier to buy technology than to develop organization and processes. The survey found that firms are most
likely to invest in technology and third-party services to support emerging channels, above skills and staff, and
far above creative development (see Figure 5). This data suggests that firms are pushing to enter emerging
channels as quickly as possible, potentially at the expense of long-term success built through the development of
in-house intellectual property and holistic programs.
"What metrics does your organization currently use to measure the success of emerging
channels?"
57%
52%
50%
43%
41%
37%
35%
35%
31%
30%
28%
20%
19%
15%
5%
1%
Click-through rate
Conversion rate (orders, leads, applications, etc)
Lift in brand awareness or affinity
Sales or revenue
Overall return on marketing investment (program dollars)
Customer satisfaction
Customer retention
Return on ad spend
Cost per Sale/Customer/Order
Share of customer wallet
Cost per lead
Customer life time value (LTV)
Average order value
Improved internal efficiency/productivity
We do not have specific metrics in place
Don't know

Page 7
Figure 5
Firms Will Spread The Money Around To Fill Numerous Holes In Their Emerging Channel Capabilities
“Our company struggles to recruit the right people who can manage marketing in a fragmented environment.
Traditional marketers lack the skills to succeed. We also need the right data analysts. Our teams need to cope with a
rapidly changing environment.” (Marketing Executive, Retail)
The Solution
By universally disrupting nearly all markets, the Splinternet creates a tremendous opportunity for those organizations
that learn to transform the challenges of fragmentation into productive customer engagement capabilities. Channels
and technology are finally able to support truly mutually beneficial relationships between firms and customers.
Marketers agree that fragmentation presents significant opportunities to firms, spanning the customer life cycle and
providing increased communication relevance (see Figure 6).
"Where will your firm invest to support emerging channels?”
53%
51%
47%
47%
37%
35%
28%
27%
1%
Technology to execute activities in emerging channels
Third party services such as agencies and consultancies
Technology to track and measure activities in emerging channels
Skills and staff to develop and manage activities in emerging
channels
Creative development to support activities in emerging channels
Technology to manage processes for marketing in emerging
channels
Media placement or messaging
Technology to manage data from emerging channels
Other

Page 8
Figure 6
Fragmentation Is An Opportunity For Segmentation And Targeting To Drive A Variety Of Objectives
Rather than ignore or resist fragmentation, firms must take advantage of this opportunity by embracing and aligning
the following components:
 Use strategy as a foundation. First and foremost, firms must develop an overarching strategy from which to
direct the tools, organization, processes, and measurement capabilities that are necessary to succeed in a
fragmented marketing ecosystem. Survey respondents indicated that strategy is the number one skill they need
in the next five years as media fragmentation occurs (see Figure 7).
"What opportunities does media fragmentation present to your organization?”
79%
62%
61%
57%
56%
50%
50%
47%
42%
40%
40%
34%
31%
25%
24%
14%
Ability to deliver more targeted or relevant communications
Increased customer engagement
New customer acquisition
Increased customer loyalty
Ability to meet customer preferences
Market research and/or customer intelligence
Brand building
Increased revenue
Customer service
Reduced reliance on mass media to drive business
Increased market share
Supporting other channels
Product innovation
Driving traffic to stores
Supporting partners
To maintained parity with competitors

Page 9
Figure 7
Strategy And Campaign Process Skills Top The Wish List
“With these emerging channels you can focus so much better. You can get down to the micro level. You can talk to
consumers at a level you can’t engage in when doing mass media. You can send them content or make them aware of
content that is of interest to them. You can segment them. You can find folks that are passionate and followers and
support you along the way. Grassroots campaigns. Question is you have to find it and how to use it, it’s
powerful.”(Marketing Executive, Manufacturing)
 Expand your toolkit. Successful adaptation to the Splinternet requires a range of technical capabilities. Firms
should aim to create a well-balanced, holistic technology portfolio addressing analytics, execution, content, and
optimization. To streamline processes and resources, technology assets must be integrated into a unified
solution where possible. For example, when considering social engagement solutions, marketers should ensure
that their solution of choice combines app creation, content management, and tracking capabilities. Survey
respondents indicated that execution technologies such as content management and campaign management
will be the most critical to their marketing organization over the next five years, followed by analytics
technology such as web analytics, targeting, and mobile analytics (see Figure 8).
“As media fragmentation occurs, what skills do you predict will be most critical to your marketing
organization over the next five years? Rank up to 5 in order of importance”
50%
13%
8%
4%
5%
6%
3%
3%
3%
2%
1%
7%
15%
10%
13%
12%
6%
10%
6%
6%
10%
4%
6%
14%
11%
13%
9%
7%
12%
7%
8%
6%
5%
9%
6%
13%
11%
8%
14%
9%
8%
6%
11%
3%
5%
5%
9%
9%
12%
10%
5%
14%
15%
7%
7%
Strategy
Campaign planning
Technology integration
Campaign analysis
Skill with online applications
Data management and segmentation
Communications
Budget management
Cross functional coordination
Creative design
Agency management
Ranked 1 Ranked 2 Ranked 3 Ranked 4 Ranked 5

Page 10
Figure 8
Execution And Analytics Capabilities Are Key To Coping With Fragmentation
 Build for scale. Marketers are not strangers to substantial amounts of data, but the Splinternet’s diversity of
devices, touchpoints, and technologies drives massive growth in data volumes and the number of data streams.
As data output continues to grow at an exponential rate, it is vital that firms focus on managing data
macroscopically. Organizations must adapt their infrastructure and data management strategies to ensure a
holistic approach to collecting, processing, and storing data as well as making that information available
efficiently for marketing analytics and operations.
 Develop the organization. Adapting to the Splinternet requires a concerted effort to build up organizations with
the skills, structure, and bandwidth to operate in a high-speed, fragmented environment. Along with focusing
efforts internally, firms should consider leveraging the operational and strategic expertise of external agencies
and consultancies. Firms reported that they are developing centralized marketing teams to consolidate
capabilities across channels, lines of business, and products to facilitate multichannel marketing (see Figure 9).
Organizations also extend beyond in-house capabilities, as many firms reported that they employ third parties
to support emerging channels and adopting technology for multichannel marketing (see Figure 10).
“As media fragmentation occurs, what technologies do you predict will be the most critical to your
marketing organization over the next five years? Rank up to 5 in order of importance.”
Note: Top 10 technologies shown.
28%
10%
4%
11%
3%
3%
4%
3%
3%
3%
9%
7%
3%
10%
7%
9%
5%
4%
7%
6%
5%
9%
10%
3%
8%
5%
5%
5%
2%
7%
5%
4%
10%
3%
8%
9%
6%
6%
5%
3%
6%
8%
6%
5%
5%
4%
8%
8%
4%
2%
Web content management
Multichannel campaign management
Social media analytics
Mobile content management
Web analytics
Social media/online community management
Data management and integration
Targeting and personalization
Visitor/Customer database
Data mining or predictive modeling
Ranked 1 Ranked 2 Ranked 3 Ranked 4 Ranked 5

Page 11
Figure 9
Multichannel Marketing Requires A Focused Organizational Approach
Figure 10
Firms Rely Heavily On Services To Support Technology
“The days when marketers could sit in their own little silo are over. These new touchpoints aren’t just a marketing
activity, they involve IT and many parts of the organization.” (Marketing Executive, Retail )
“Because of technology changing so fast, having 1-2 people who are familiar with it is not possible. It’s better to rely on
outside resources.” (Marketing Executive, Manufacturing)
"Please describe your firm’s organizational approach to support marketing across multiple
channels.”
49%
26%
15%
10%
Centralized marketing team, consolidating all technology
and services across channels, products, and corporate
groups
Decentralized marketing team, brands, product teams,
corporate groups have independent marketing capabilities
Hub and Spoke – certain capabilities are centrally
supported but product teams or corporate groups have
some autonomy
Marketing is organized by channel
"Please describe your firm’s technology approach to support marketing across multiple channels.”
25%
24%
17%
16%
14%
3%
1%
We have a hybrid approach of working with technology
internally and external providers
We have a primary technology platform that supports
most functions
We have an agency or service provider that provides a
managed service for technology
We have built our own technology to support marketing
We use best-of-breed technology for most functions
We have a hybrid approach of working with third-party
software providers and internally developed technology
Other

Page 12
 Measure the right things, not everything. Fragmentation is a double-edged sword in terms of measurement: It
generates massive amounts of data from which to perform measurement, but the sheer volume of potential
metrics can cause paralysis or misdirect unsuspecting marketers. Fortunately, firms do not need to measure all
the data, they just need to measure the right data, shifting from breadth-based approaches to focus on depth in
measurement strategy. This entails defining KPIs at multiple levels: first for channel-specific activities to
determine tactical success, and second, a set of global KPIs to support standardized measurement and
attribution across channels.
“Success is really hard to measure. One of the biggest challenges. The vast majority of our measurement is in terms of
inquiries, leads, pipeline driven and it’s really difficult to measure a social network in that way. How do you measure?
Numbers of members in the community? Or getting the CIO of the biggest company in the country rather than 15
smaller CIOs? It’s about quality and quantity of people in the community.”(Marketing Director, Consumer Packaged
Goods)
“It’s being able to attribute all pieces of marketing and sales engagement in one inquiry that leads to opportunity.”
(Marketing Manager, High Tech)

Page 13
KEY RECOMMENDATIONS
Without a doubt, the fragmentation that is central to the Splinternet creates challenges to marketing organizations. But
more than disruption, fragmentation embodies a once-in-a-generation opportunity for marketers to engage with
customers in more ways, and more productively, than ever before. To make the most of this opportunity, organizations
must take a holistic approach to addressing the Splinternet — starting with a cohesive strategy, and then addressing
subsequent technology, organizational, and measurement components. To put a comprehensive approach to harnessing
the benefits of fragmentation into effect, proactive organizations should take the following steps:
 Experiment then operationalize. Take a structured, experiment-oriented approach to adopting new channels.
Fund a formal test program or support low-cost, minimal resource, informal participation to evaluate new channels
and determine whether to proceed with a full-scale rollout and allocate significant budget and resources. This
approach permits organizations to explore channels while limiting risk.
 Don’t go it alone. Based on an inventory of your current capabilities, prioritize initiatives to fill in gaps based on
your short- and long term goals and determine if additional skills or bandwidth from third parties is needed.
Leverage agencies, consultancies, and vendor professional services to complement internal core competencies
where needed. When considering external support, always ensure that potential partners have a perspective on
multichannel marketing that is consistent with that of your organization.
 Prioritize measurement. To avoid uncertain ROI and to develop performance benchmarks, no activity should be
executed without a measurement plan in place. In addition to channel specific metrics, utilize business-oriented
KPIs across all channels to ensure that tactics are delivering suitable performance within the context of the entire
marketing plan and support the firm’s strategic goals.
 Make analytics actionable. To take full advantage of the data generated by interacting with customers across
channels and devices, take analysis beyond static reporting and translate insights into actionable strategies.
Feeding the output of marketing analytics back into content and execution strategy allows firms to proactively
drive the customer experience with tactics based on user behavior and preferences. Leverage data-driven
techniques such as online targeting, triggering, and segmentation to optimize marketing activities.
 Democratize data insights. Beyond the expansion and fragmentation of channels, the Splinternet also reduces
dependence on discrete channels in favor of multichannel marketing. To excel in this environment, marketers need
visibility to the entire engagement funnel. When developing the measurement strategy, consider how analysis will
be distributed to marketing and business stakeholders beyond channel owners and analysts to ensure that they
have a comprehensive view of customers and prospects.
 Get ready for mobile now. Social is very popular with consumers and marketers today, but the mobile revolution
is under way. Begin evaluating mobile channels and establishing benchmarks to ensure that your organization is
ready to expand into mobile once it hits the tipping point with your target customers.
 Market your presence in emerging channels. The social and mobile ecosystems may be emerging but they are
rapidly getting crowded. Simply creating a presence in these channels is no longer enough to ensure adoption.
Firms need to market their emerging channel presence to create awareness. Promoting participation in digital
channels via the website is an obvious tactic but also consider referring to social and mobile capabilities in print,
additional interactive media, and via customer-facing staff. Successful firms must also undertake specific
promotional campaigns to notify customers and prospects about online channels and emerging media.

Page 14
Appendix A: Methodology
In this study, Forrester conducted interviews with five marketing decision-makers along with an online survey of 210
North American and European marketers to evaluate the industry pain points, trends of the Splinternet, the future of
web analytics, and recommend strategies for optimizing marketing within this rapidly evolving environment. Survey
participants included decision-makers in marketing and management-level practitioner and managers and above.
Questions provided to the participants asked about the benefits, trends, and opportunities that face marketers today
around the fragmentation of the internet and best practices on what marketers are doing today to measure and analyze
their consumers and brands. The study was completed in July 2011.
Appendix B: Demographics/Data
Figure B1
Revenue And Company Size
28%
21%
20%
18%
14%
$10 billion
or more
$2 billion to
$4.9 billion
Less than
$1 billion
$1 billion to
$1.9 billion
$5 billion to
$ 9.9 billion
"What is the total annual revenue
of your company?”
"Using your best estimate, how many employees
work for your company worldwide?”
36%
36%
14%
10%
3%
1,000 to 4,999
employees
20,000 employees or
more
5,000 to 9,999
employees
10,000 to 19,999
employees
Less than 1,000
employees

Page 15
Figure B2
Region
Figure B3
Job Level And Decision-Marking
"Where is the primary market you are targeting with your marketing efforts?”
United States,
50%
United Kingdom,
25%
France, 5%
Germany, 20%
"Which of the following best describes
your job level at your firm?”
51%
34%
8%
7%
Manager
Director
C- level or senior-most
executive
Vice president, senior
vice president, or
executive vice
president
"Which of the following most closely describes your role in
your organization’s interactive and multichannel
marketing? "
41%
24%
18%
18%
I’m directly involved in my
organization’s interactive and
multichannel marketing strategy
I’m the key decision-maker in
my organization’s interactive
and multichannel marketing
strategy
I manage a team that is directly
involved in my organization’s
interactive and multichannel
marketing strategy
I’m indirectly, but significantly
involved in decisions around my
organization’s interactive and
multichannel marketing strategy

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