Philips aims to become a leader in health and well-being through meaningful innovations that improve lives. Growing demand will come from aging populations, environmental awareness, and emerging markets. Social media is blurring lines between marketing and PR, with trust in peer recommendations over advertisements. Studies show companies benefitting from social media through increased sales, customer satisfaction, knowledge sharing, and reduced costs. Philips' digital strategy focuses on consistency, continuity, creativity, and understanding customers through engagement rather than just transactions.

1. New Communications in a networkedworld – the Philips case Author Divison MMMM dd, yyyy

2. NEW COMMUNICATIONS IN A NETWORKED WORLD

3. 3 We target attractive growth markets and have a compelling mission “Philips’ strategy is to become the leading company in Health & Well-being. Growing demand for healthcare, a healthy lifestyle and energy-efficient lighting solutions will be driven by an aging population, increased environmental awareness and expanding emerging markets Our ability to create (and deliver) meaningful innovations (to our customers) to improve people’s lives

4. Survey findings. 81% : “Significant” or “Very Significant” Most critical organizational issues Ensuring the right skill sets Training and educating staff Educating senior management Most critical executional issues Understanding best practices How to prioritize social media Digital content … Managing corporate reputation in an uncontrolled environment… Integrating online and offline across multiple channels 4

5. Marketing and PR are converging Corp Comms/PR Relationships Reputation Content Marketing Brand Advertising Content Social Media Success Embraces two-way Builds relationships Relevant Integrated Adds value Measured Digital strategies and social media increasingly blur the lines between Corp Comms/PR and Marketing. Natural assets from all disciplines are critical for success.

6. 14% 78% Trust advertisements Trust the recommendationsof peers {Conversation} {One-Way} Source: Forrester

7. Correlating social media engagement with financial performance. In the last twelve months Revenue Growth % Wallflowers Selectives Butterflies Mavens Source: Altimiter/Wetpaint July 2009 Gross Margin Growth % Net Margin Growth % 18% 15% 10% 1% 4% 5% 3% -2% -9% -4% -11% -6% 7

8. McKinsey: Companies are measurablybenefiting from Web 2.0. With partners and suppliers. Internally. With customers. Source: McKinsey , September 2009

9. With customers. Increased effectiveness and customer satisfaction, reduced costs Using a mix of techniques Source: McKinsey Global Survey , September 2009 Awareness +25% Consideration +19% Conversion +17% Loyalty +20% Increasing effectiveness of marketing Video sharing Blogs Increasing customer satisfaction +20% RSS -15% Reducing marketing costs Social networking -15% Wikis Reducing support costs Podcasts -20% Reducing travel costs Rating Reducing time to market for products/services -20% Tagging Increasing number of successful innovations for new products or services +20% P2P Microblogging +10% Increasing revenue Mashups No measurable effects/benefits Prediction markets 9

10. Internally. Increased knowledge, reduced costs Using a mix of techniques Source: McKinsey Global Survey , September 2009 +30% Increasing speed of access to knowledge Video sharing Blogs -20% Reducing communication costs RSS +35% Increasing speed of access to internal experts Social networking -20% Decreasing travel costs Wikis Increasing employee satisfaction +20% Podcasts -15% Reducing operational costs Rating Tagging Reducing time to market for products/services -20% P2P Increasing number of successful innovations for new products or services +20% Microblogging 15% Increasing revenue Mashups No measurable effects/benefits Prediction markets 10

11. With partners and suppliers. Increased knowledge , speed, satisfaction and reduced costs … Using a mix of techniques Source: McKinsey Global Survey , September 2009 +25% Increasing speed of access to knowledge Video sharing -20% Reducing communication costs Blogs RSS +30% Increasing speed of access to external experts Social networking -20% Reducing travel costs Wikis +20% Increasing satisfaction of suppliers, partners, external experts Podcasts -20% Reducing time to market for products/services Rating -12% Reducing supply chain costs Tagging Reducing product development costs -20% P2P Increasing number of successful innovations for new products or services +20% Microblogging +15% Increasing revenue Mashups No measurable effects/benefits Prediction markets 11

12. Philips and the online opportunities Channel thinking – Outside / In Consistency – One Philips Continuity – nohopping of and on Creativity Commitmentacross the Board

13. People don’t care what you say about your company. 13

14. Channel thinking – Outside In – news room

15. Channel thinking – Outside In - LinkedIn

16. “It’s not about targeting audiences; it’s about drawing an irresistible bull’s-eye on yourself so audiences will target you.” Dave Senay, CEO, Fleishman-Hillard 16

17. Buzz Web 2.0 Wikis Social Media Folksonomy Podcasting RSS Blogs Media relations Tagging Wireless Promotions Grassroots Search engine marketing YouTube Press releases Pitching reporters Factsheets Online editorial outreach Consumer-generated content Reputationmanagement Publicity Public affairs Citizen journalism Viral marketing Special events Employee communications Coalitions Flogs Advergaming PR stunts IR Branding Mobile marketing Tivo Third party outreach Metaverses MySpace Social networking We Media Flickr New Traditional Content optimization Facebook Syndication

18. Organization A new value equation. From: Message 5,000,000 to possibly reach 500 To: Personallyreach500who influence 5,000 who influence 50,000who influence 5,000,000 Value Equation: 5,000 people who want to hear your message are more valuable than 5 millionwho don’t.

19. Consistency across sectors

20. Continuity – Strategy is imperative! Digital Content strategy OnePhilips project The themes around which we align The properties that will be maintained How we will measure effectiveness How we will listen How we will manage these properties for the long term Internal “Help desk”: why, when, what, how?

21. Continuity – Stakeholder Relations Network GetInsideHealth Newsletter A monthly, dynamic newsletter individually tailored to the interests of our audience, alerting them to new, relevant content on GetInsideHealth.com Results Average open rate: 26% Average click-through rate: 36% Over 10,000 subscribers

22. Digital content strategy – Internal Communications Digital Workplace

23. Used on a creative commons license from Brian Solis and Pr 2.0

24. Creativity – what makes you stand out?

27. “Now it’s the people who are taking control.” Rupert Murdoch, CEO, News Corp. 27

29. What are we looking at. Relevance Influencer Rankings Activity, Reach and Links Share of Voice Sentiment Sentiment vs. competitors % of Influencer’s Engaged Top Themes Group Membership Stats Theme-SEO coherence Where are the conversations? Who is most important to me? How many people am I reaching? How am I doing vs. competitors? Are people positive or negative? How I am perceived vs. competitors? Do top influencers talk about me? What are people saying? How many people connect with me? Does my online profile align with the conversation?

32. NegativeWord of Mouth