Thursday
Reach & Frequency - Back in the Spotlight
Although people in the online ad industry aren't talking about R&F much anymore, they remain important metrics, albeit for different reasons than for offline media.
It seems like not so long ago, everywhere you looked in this industry you found people gathered together and talking about reach and frequency. They were THE topics du jour.
In offline media, reach and frequency are a given -- criteria by which plan options are measured against one another. They are representative of communications' delivery goals, which marketers use to determine how much the "needle" is moved as a result of their advertising efforts.
It seemed that for a while there, these important measures were going to be just as significant for online advertising as they have been for offline. Every major research and technology company was going to get involved, from NetRatings to Atlas DMT. Even the ARF issued guidelines by which reach/frequency on the Web was to be determined.
But now, silence. No one seems to be talking about it anymore.
Just what is going on with the reach and frequency issue online?
Reach and frequency are still important as they relate to online advertising media planning, but the angle taken – and therefore, the emphasis – has shifted somewhat.
The silence on the topic isn't that reach and frequency has become less important: "The problem is that it was never finished," says David Smith, president of Mediasmith in San Francisco and chair of the Advertising Research Federation's Online Media Council. He points out that reach and frequency as a consideration has a different focus within the agency community.
"It is not so much an issue for online people who are more buyer-oriented," continues Smith. "It is an issue in the bigger agencies where the planning is done where it has always been done."
What this means is that shops with cross-media responsibilities that might include online are in greater need of being able to express that online media component in terms that articulates its contribution comparable to that of the other media under consideration.
"Reach/frequency continues to be important to online advertising as a predictive/planning tool to predetermine the contribution online media could have to an overall marketing effort," says Alan Schanzer, managing partner at The Digital Edge. "Like a CPM, reach/frequency allows us to compare varying types of media with some degree -- or accepted -- level of comfort."
Something to understand about reach/frequency, if you don't already, is that in terms of its use for online, it can allow for the medium's communication delivery to be represented in terms that can be expressed within the context of the overall media package.
There are tools out there that media planners and buyers can use for predictive purposes that enable them to look at what kind of reach an online campaign might be able to accomplish. But these tools aren't yet providing the kind of combined reach and frequency that would let planners and buyers know in what way the communication delivery of a media plan is effected by online's presence. That is being worked on, however.
"Currently, the Digital Edge is in a 'beta' phase with various R&F tools. We are able to use info from Web RF in combination with other media types, which is very useful," says Schanzer. "In general, this is very effective at showing -- at least directionally -- the contribution online could make to an overall campaign. The bottom line is that to the extent we'll still accept reach/frequency in general, it is being accepted as an online measurement tool."
According to Smith -- the industry's resident expert on the topic -- the real reason why reach and frequency matter to online – and this might be true for reach and frequency in all contexts – is in the execution. "Given that you can execute a plan successfully, you want to be able to replicate it," he says. "If the sites vary wildly in execution AND we do not have a good post-analysis tool, you can get a lot of reach one time and a lot of frequency another, etc."
So, the use of reach and frequency for online goes beyond the metric as a predictive measure. It is its ability to quantify the best of all possible media worlds and allow advertisers to yield the same or similar effects repeatedly.
But what online reach and frequency tools one day may be capable of that isn't possible for offline media is monitoring and adjusting media plans while they are live to ensure the post-delivery of the initial communication delivery goal. At the end of the day, what an advertiser really wants is the satisfaction of a communication delivery goal. That is because whatever objective has been set is what a communication delivery goal is based on. The number of impressions, TRPs, inserts, what have you, is all based on what level of communication the campaign has to achieve to accomplish those goals.
How loud do I have to shout my message and how often do I have to shout it in order to move the needle whatever amount I'm being asked to move it?
Online, there is the potential for watching this take place and manipulating your media accordingly to optimize its effects.
"We've got to prove that what we laid out as a goal is achieved (post buy)," says Smith. He says we also need to have the ability to track what is going on while the buy is live so we can adjust and optimize the plan based on R/F goals.
Whatever may be said about reach/frequency's importance to media, however, there still seems to be little adoption by the online advertising community. But this isn't necessarily because the metric isn't meaningful.
Relevance is what is questionable; relevance and client demand. Clients might like to have reach and frequency available for their online plans, but they aren't asking for it in ways that make agencies feel any urgency.
Agencies don't "understand the relevance as much as the traditional folks who are planning and allocating their budgets," says Smith. That is due in large part to a lack of pressure from the client.
But it may be due to larger issues.
"Reach/frequency as a standard may be a dying measure," posits Schanzer. "As with the Internet, the conversations around on-demand [and] iTV technology are more about user interaction than users reached. This will continue to trend as digital media formats become more prevalent in the common household. What we are seeing are the standards for offline media being raised to the higher standard of online media." He says this is a bit ironic, seeing as many online practitioners now spend so much time trying to be like general media planners and buyers.
Indeed, as more technology enables advertisers to hold media more accountable by allowing the read on a specific individual's proclivities and engagements with a brand, reach and frequency will come to matter less.
There are sites that survey their users regularly and require registration. There are behavioral marketing platforms that can inform the way ads are delivered. There are technologies that collect audience data from pre-existing sources such as ad servers, content servers and email databases. Being able to merge them with other data sources such as subscription or registration databases to not only extract greater understanding of value of an audience, but also identify that audience as saleable ad inventory, could make discernable interactions from individuals more valuable than reach and frequency.
That said, if we believe the medium CAN actually be used for the purposes of branding, then the only way to carry on the rhetorical discourse that branding in part consists for the purposes of selling is to surrogate the appropriate number of people who must be touched by the message. That surrogate is the communication delivery goal that reach and frequency represent. This will in turn yield some variable of widgets that will be sold. That's essentially why it is used in traditional media, and the same would hold true for online.
Ultimately, the Internet as a marketing tool has to be based in some measure on its ability to use database systems that allow for unique identification of individuals in an audience as prospective consumers. But this view is slow to manifest, at least until a new generation of brand managers and media directors for whom technology is neither scary and for whom data-driven marketing is taken for granted are working together.
Until then, reach and frequency are the best methods at our disposal for determining communication delivery value for a client that would use the medium as a tool for branding and not just to elicit impulse sale.
It seems like not so long ago, everywhere you looked in this industry you found people gathered together and talking about reach and frequency. They were THE topics du jour.
In offline media, reach and frequency are a given -- criteria by which plan options are measured against one another. They are representative of communications' delivery goals, which marketers use to determine how much the "needle" is moved as a result of their advertising efforts.
It seemed that for a while there, these important measures were going to be just as significant for online advertising as they have been for offline. Every major research and technology company was going to get involved, from NetRatings to Atlas DMT. Even the ARF issued guidelines by which reach/frequency on the Web was to be determined.
But now, silence. No one seems to be talking about it anymore.
Just what is going on with the reach and frequency issue online?
Reach & Frequency Take a New Focus Online
Reach and frequency are still important as they relate to online advertising media planning, but the angle taken – and therefore, the emphasis – has shifted somewhat. The silence on the topic isn't that reach and frequency has become less important: "The problem is that it was never finished," says David Smith, president of Mediasmith in San Francisco and chair of the Advertising Research Federation's Online Media Council. He points out that reach and frequency as a consideration has a different focus within the agency community.
"It is not so much an issue for online people who are more buyer-oriented," continues Smith. "It is an issue in the bigger agencies where the planning is done where it has always been done."
What this means is that shops with cross-media responsibilities that might include online are in greater need of being able to express that online media component in terms that articulates its contribution comparable to that of the other media under consideration.
"Reach/frequency continues to be important to online advertising as a predictive/planning tool to predetermine the contribution online media could have to an overall marketing effort," says Alan Schanzer, managing partner at The Digital Edge. "Like a CPM, reach/frequency allows us to compare varying types of media with some degree -- or accepted -- level of comfort."
Something to understand about reach/frequency, if you don't already, is that in terms of its use for online, it can allow for the medium's communication delivery to be represented in terms that can be expressed within the context of the overall media package.
There are tools out there that media planners and buyers can use for predictive purposes that enable them to look at what kind of reach an online campaign might be able to accomplish. But these tools aren't yet providing the kind of combined reach and frequency that would let planners and buyers know in what way the communication delivery of a media plan is effected by online's presence. That is being worked on, however.
"Currently, the Digital Edge is in a 'beta' phase with various R&F tools. We are able to use info from Web RF in combination with other media types, which is very useful," says Schanzer. "In general, this is very effective at showing -- at least directionally -- the contribution online could make to an overall campaign. The bottom line is that to the extent we'll still accept reach/frequency in general, it is being accepted as an online measurement tool."
According to Smith -- the industry's resident expert on the topic -- the real reason why reach and frequency matter to online – and this might be true for reach and frequency in all contexts – is in the execution. "Given that you can execute a plan successfully, you want to be able to replicate it," he says. "If the sites vary wildly in execution AND we do not have a good post-analysis tool, you can get a lot of reach one time and a lot of frequency another, etc."
So, the use of reach and frequency for online goes beyond the metric as a predictive measure. It is its ability to quantify the best of all possible media worlds and allow advertisers to yield the same or similar effects repeatedly.
But what online reach and frequency tools one day may be capable of that isn't possible for offline media is monitoring and adjusting media plans while they are live to ensure the post-delivery of the initial communication delivery goal. At the end of the day, what an advertiser really wants is the satisfaction of a communication delivery goal. That is because whatever objective has been set is what a communication delivery goal is based on. The number of impressions, TRPs, inserts, what have you, is all based on what level of communication the campaign has to achieve to accomplish those goals.
How loud do I have to shout my message and how often do I have to shout it in order to move the needle whatever amount I'm being asked to move it?
Online, there is the potential for watching this take place and manipulating your media accordingly to optimize its effects.
"We've got to prove that what we laid out as a goal is achieved (post buy)," says Smith. He says we also need to have the ability to track what is going on while the buy is live so we can adjust and optimize the plan based on R/F goals.
Online's Adoption of R/F Still Coming
Whatever may be said about reach/frequency's importance to media, however, there still seems to be little adoption by the online advertising community. But this isn't necessarily because the metric isn't meaningful. Relevance is what is questionable; relevance and client demand. Clients might like to have reach and frequency available for their online plans, but they aren't asking for it in ways that make agencies feel any urgency.
Agencies don't "understand the relevance as much as the traditional folks who are planning and allocating their budgets," says Smith. That is due in large part to a lack of pressure from the client.
But it may be due to larger issues.
"Reach/frequency as a standard may be a dying measure," posits Schanzer. "As with the Internet, the conversations around on-demand [and] iTV technology are more about user interaction than users reached. This will continue to trend as digital media formats become more prevalent in the common household. What we are seeing are the standards for offline media being raised to the higher standard of online media." He says this is a bit ironic, seeing as many online practitioners now spend so much time trying to be like general media planners and buyers.
Indeed, as more technology enables advertisers to hold media more accountable by allowing the read on a specific individual's proclivities and engagements with a brand, reach and frequency will come to matter less.
There are sites that survey their users regularly and require registration. There are behavioral marketing platforms that can inform the way ads are delivered. There are technologies that collect audience data from pre-existing sources such as ad servers, content servers and email databases. Being able to merge them with other data sources such as subscription or registration databases to not only extract greater understanding of value of an audience, but also identify that audience as saleable ad inventory, could make discernable interactions from individuals more valuable than reach and frequency.
That said, if we believe the medium CAN actually be used for the purposes of branding, then the only way to carry on the rhetorical discourse that branding in part consists for the purposes of selling is to surrogate the appropriate number of people who must be touched by the message. That surrogate is the communication delivery goal that reach and frequency represent. This will in turn yield some variable of widgets that will be sold. That's essentially why it is used in traditional media, and the same would hold true for online.
Ultimately, the Internet as a marketing tool has to be based in some measure on its ability to use database systems that allow for unique identification of individuals in an audience as prospective consumers. But this view is slow to manifest, at least until a new generation of brand managers and media directors for whom technology is neither scary and for whom data-driven marketing is taken for granted are working together.
Until then, reach and frequency are the best methods at our disposal for determining communication delivery value for a client that would use the medium as a tool for branding and not just to elicit impulse sale.
Wednesday
Online Advertising Dramatically Boosts Power of Traditional Media
Study shows Substantial Gains in Audience Reach, Branding Effectiveness and Purchase Intent
Online advertising generates a dramatic boost for big-brand advertising campaigns according to innovative new Pan-European research released today by the European Interactive Advertising Association (EIAA). This unique study, the first to be conducted across four media simultaneously in three different countries, tracked 15 major brand campaigns in the UK, France and Germany, was conducted by the independent research firm NFO Infratest. The study demonstrated that:
Online advertising substantially increased the overall reach of a multimedia (TV, radio, print) campaign
§ The aggregate reach of 41% delivered by TV campaigns rose to 63% with the inclusion of people exposed only to online advertising
Online advertising substantially increased the effectiveness of TV, print and radio advertising
§ Aggregate results across all 15 campaigns showed that ad recall increased by 27% after exposure to the TV campaigns, however using TV and online together almost doubled the increase to 45%
§ Using online plus another media substantially increased positive perceptions of the brands such as “trendy”, “innovative” and “unique” thereby helping to extend brand image
§ Online advertising was found to work very effectively with Radio and Print. In particular, more targeted campaigns benefited substantially from the use of Internet together with Radio/Print in the media mix. For example, in the case of a youth orientated campaign Online and Radio demonstrated that they best worked together to reach this target and in fact this combination [1] resulted in the highest increase in purchase/usage intent than any other combination of media.
Using online and another media also helped to improve recollection of details of the advertisements and purchase intent
§ Recall of ad details increased by 14% amongst people exposed to TV ads only, recall amongst those exposed to TV and online ads increased 44%
§ Intent to buy the product or become a client increased by 2% amongst people who saw TV ads only, yet increased a massive 12% amongst those exposed to TV and online ads
The study was commissioned by the EIAA to quantify the dynamics of how online, TV, radio and print advertising interact in order to help marketers plan more effective cross-media campaigns.
Michael Kleindl, EIAA Chairman and CEO of AdLINK Internet Media AG, commented "The data shows that by adding the online medium to their media mix major brands can strongly improve results in terms of reach and effectiveness. We believe that this great step forward in our understanding of the value of online advertising will contribute to an increased share of overall advertising spend."
Jupiter Media Metrix forecasts the European Online Advertising market to be worth €1,186m in 2002 rising to €3,595m in 2007. [2]
Online advertising generates a dramatic boost for big-brand advertising campaigns according to innovative new Pan-European research released today by the European Interactive Advertising Association (EIAA). This unique study, the first to be conducted across four media simultaneously in three different countries, tracked 15 major brand campaigns in the UK, France and Germany, was conducted by the independent research firm NFO Infratest. The study demonstrated that:
Online advertising substantially increased the overall reach of a multimedia (TV, radio, print) campaign
§ The aggregate reach of 41% delivered by TV campaigns rose to 63% with the inclusion of people exposed only to online advertising
Online advertising substantially increased the effectiveness of TV, print and radio advertising
§ Aggregate results across all 15 campaigns showed that ad recall increased by 27% after exposure to the TV campaigns, however using TV and online together almost doubled the increase to 45%
§ Using online plus another media substantially increased positive perceptions of the brands such as “trendy”, “innovative” and “unique” thereby helping to extend brand image
§ Online advertising was found to work very effectively with Radio and Print. In particular, more targeted campaigns benefited substantially from the use of Internet together with Radio/Print in the media mix. For example, in the case of a youth orientated campaign Online and Radio demonstrated that they best worked together to reach this target and in fact this combination [1] resulted in the highest increase in purchase/usage intent than any other combination of media.
Using online and another media also helped to improve recollection of details of the advertisements and purchase intent
§ Recall of ad details increased by 14% amongst people exposed to TV ads only, recall amongst those exposed to TV and online ads increased 44%
§ Intent to buy the product or become a client increased by 2% amongst people who saw TV ads only, yet increased a massive 12% amongst those exposed to TV and online ads
The study was commissioned by the EIAA to quantify the dynamics of how online, TV, radio and print advertising interact in order to help marketers plan more effective cross-media campaigns.
Michael Kleindl, EIAA Chairman and CEO of AdLINK Internet Media AG, commented "The data shows that by adding the online medium to their media mix major brands can strongly improve results in terms of reach and effectiveness. We believe that this great step forward in our understanding of the value of online advertising will contribute to an increased share of overall advertising spend."
Jupiter Media Metrix forecasts the European Online Advertising market to be worth €1,186m in 2002 rising to €3,595m in 2007. [2]
EIAA launches Standardised Online Ad Formats
Industry responds to advertiser demand for standardisation, impact and consistency across Europe
The European Interactive Advertising Association (EIAA) and the Interactive Advertising Bureau Europe (IAB Europe) today announced the launch of the first European online ad format standardisation. The EIAA and IAB Europe see this European consolidation as an important step towards global consistency.
This move demonstrates the industry’s commitment to making online as easy to plan, buy and create as offline campaigns and comes in response to demands from the planning, buying and advertiser communities for a simplified, cost effective and creative ad offering.
The package of European Online Ad Formats is a series of recommended ad sizes which will be implemented across EIAA and IAB Europe member networks to facilitate the implementation and growth of pan-European online advertising campaigns.
This standardisation will increase the efficiency of planning and executing an online advertising campaign and is expected to remove the confusion created by sites having disparate format specifications and reduce the number of ads per page. The larger ad sizes in the package, such as the 728x90 Super Banner and 160x600 Wide Skyscraper, will give greater impact and encourage creativity.
To create consistency, transparency and comparability, EIAA and IAB member organisations have agreed to move towards a standard suite of six ad formats. These include the four formats contained in the Universal Ad Package (UAP) announced by the IAB US in April 2003 as well as two of the most currently used ad formats across Europe, the 468 x 60 Traditional Banner and 120 x 600 Skyscraper.
The European Online Standard Ad Package includes:
* 468 x 60 Traditional Banner
* 120 x 600 Skyscraper
* 160 x 600 UAP Wide Skyscraper
* 180 x 150 UAP Rectangle
* 300 x 250 UAP Medium Rectangle
* 728 x 90 UAP Super Banner
Historically many web sites have defined the formats for online advertising according to individual site layout which has resulted in many formats being offered to advertisers. Few standard formats have been established to date and the EIAA and IAB members have decided to create this European standard whilst gradually retiring other formats in order to simplify online media planning, reduce production costs and give greater scope to online creativity. The multitude of formats in use currently leads to increased production costs for agencies and clients as well as making online media planning complex and time consuming.
Michael Kleindl, EIAA Chairman, commented, "This initiative is a response to continued feedback from the advertiser, planning and buying communities regarding the need for simplified formats as a means to executing more effective campaigns. We want to generate more scope for creativity and facilitate the growth of truly pan-European ad campaigns."
"This is another watershed in the internet's commercial development.” said Danny Meadows-Klue, president, IAB Europe. “These core sizes will become available across thousands of European websites giving advertisers the chance to run pan-European campaigns on a scale never before possible."
According to Nielsen//NetRatings, EIAA members AOL, Lycos Europe, MSN, Tiscali, T-Online and Yahoo! have a combined reach of 64.7 million (78% of total) active home users across Europe (UK, France, Germany, Spain, Italy, Sweden, Netherlands, Switzerland).
Jupiter Media Metrix forecasts the European Online Advertising market to be worth €4,014 million by 2008.
The European Interactive Advertising Association (www.eiaa.net) is a unique pan-European trade organisation for sellers of interactive media. The primary objectives of the EIAA are to champion and to improve the understanding of the value of online advertising as a medium, to grow the European interactive advertising market by proving its effectiveness, thus increasing its share of total advertising investment. Its members are currently AdLINK Internet Media AG, AOL Europe, IP-WEB.NET (part of the RTL Group), Lycos Europe, MSN International, Tiscali, T-Online International, Yahoo! Europe. It is chaired by Michael Kleindl, Managing Partner of Valkiria Network
The European Interactive Advertising Association (EIAA) and the Interactive Advertising Bureau Europe (IAB Europe) today announced the launch of the first European online ad format standardisation. The EIAA and IAB Europe see this European consolidation as an important step towards global consistency.
This move demonstrates the industry’s commitment to making online as easy to plan, buy and create as offline campaigns and comes in response to demands from the planning, buying and advertiser communities for a simplified, cost effective and creative ad offering.
The package of European Online Ad Formats is a series of recommended ad sizes which will be implemented across EIAA and IAB Europe member networks to facilitate the implementation and growth of pan-European online advertising campaigns.
This standardisation will increase the efficiency of planning and executing an online advertising campaign and is expected to remove the confusion created by sites having disparate format specifications and reduce the number of ads per page. The larger ad sizes in the package, such as the 728x90 Super Banner and 160x600 Wide Skyscraper, will give greater impact and encourage creativity.
To create consistency, transparency and comparability, EIAA and IAB member organisations have agreed to move towards a standard suite of six ad formats. These include the four formats contained in the Universal Ad Package (UAP) announced by the IAB US in April 2003 as well as two of the most currently used ad formats across Europe, the 468 x 60 Traditional Banner and 120 x 600 Skyscraper.
The European Online Standard Ad Package includes:
* 468 x 60 Traditional Banner
* 120 x 600 Skyscraper
* 160 x 600 UAP Wide Skyscraper
* 180 x 150 UAP Rectangle
* 300 x 250 UAP Medium Rectangle
* 728 x 90 UAP Super Banner
Historically many web sites have defined the formats for online advertising according to individual site layout which has resulted in many formats being offered to advertisers. Few standard formats have been established to date and the EIAA and IAB members have decided to create this European standard whilst gradually retiring other formats in order to simplify online media planning, reduce production costs and give greater scope to online creativity. The multitude of formats in use currently leads to increased production costs for agencies and clients as well as making online media planning complex and time consuming.
Michael Kleindl, EIAA Chairman, commented, "This initiative is a response to continued feedback from the advertiser, planning and buying communities regarding the need for simplified formats as a means to executing more effective campaigns. We want to generate more scope for creativity and facilitate the growth of truly pan-European ad campaigns."
"This is another watershed in the internet's commercial development.” said Danny Meadows-Klue, president, IAB Europe. “These core sizes will become available across thousands of European websites giving advertisers the chance to run pan-European campaigns on a scale never before possible."
According to Nielsen//NetRatings, EIAA members AOL, Lycos Europe, MSN, Tiscali, T-Online and Yahoo! have a combined reach of 64.7 million (78% of total) active home users across Europe (UK, France, Germany, Spain, Italy, Sweden, Netherlands, Switzerland).
Jupiter Media Metrix forecasts the European Online Advertising market to be worth €4,014 million by 2008.
European Interactive Advertising Association
The European Interactive Advertising Association (www.eiaa.net) is a unique pan-European trade organisation for sellers of interactive media. The primary objectives of the EIAA are to champion and to improve the understanding of the value of online advertising as a medium, to grow the European interactive advertising market by proving its effectiveness, thus increasing its share of total advertising investment. Its members are currently AdLINK Internet Media AG, AOL Europe, IP-WEB.NET (part of the RTL Group), Lycos Europe, MSN International, Tiscali, T-Online International, Yahoo! Europe. It is chaired by Michael Kleindl, Managing Partner of Valkiria Network
Measuring Online Ad Effectiveness
MARKETERS have long said they would increase their online advertising budgets if Internet sites would do what they promised to do years ago: quantify the effects of an ad campaign on sales, brand awareness and other factors like the consumer's intent to buy.
With each passing month, online companies are increasingly able to do just that. The question is, will marketers actually respond?
Google is the latest Internet company to make good on the promise. A new feature allows advertisers to copy a string of software code from Google's Web site onto pages of their own sites. When users click on the advertiser's link from Google's Web site, Google follows the user's progress. Like other companies, Google does not collect personally identifiable information on the user.
Advertisers can log on to Google to view graphs showing how many visitors bought an item, signed up for an e-mail message or sought other information deemed significant. Armed with that information, marketers can determine if their ads are worth the expense.
"We think it's critical to help advertisers keep track of what's going on," Salar Kamangar, Google's director for product marketing, said. "We didn't want them to either overbid or underbid," he said, referring to the process by which advertisers pay for Google ads. "If they overbid, we could possibly lose them as a customer. If they underbid, they're competing less effectively than the competition."
In the three weeks since Google announced the feature, Mr. Kamangar said, the site has received stronger than expected interest from advertisers. While declining to be specific about usage, Mr. Kamangar said clients using the new service had "generally increased their bids, rather than decreased them."
The feature also helps Google avoid temporary advertising suspensions by marketers, who often test the effectiveness of their ads by simply stopping their advertising campaigns for a few days and tracking the effects on sales.
Industry analysts say the Google feature, and similar services from companies like DoubleClick, LinkShare and CentrPort, are helping a generation of marketing executives to quantify the benefits of their advertising investments.
"This isn't something most traditional marketers are used to thinking about," said Charlene Li, an analyst with Forrester Research, a technology consulting firm. "Most of these ad executives got to where they are because they ran great branding campaigns," and not by showing statistical acumen, she said.
Indeed, before the Web, the only advertising medium that made such calculations was direct mail, which many marketing executives regard as being filled with junk mailers and number-crunching catalog mavens.
"But in the last couple years, C.E.O.'s in traditional companies have been looking at budgets for all these different areas of the business and calculating the return on investment for all that spending," Ms. Li said. "Now they're finally looking at marketing budgets, too, and saying, 'You're spending $1 million on this campaign, and what exactly is it going to do for sales?' "
But even though online tools are now available to measure return on advertising, traditional marketers know little about them.
A new Forrester survey of 95 marketers, released Friday, found that 81 percent said their online ad spending would increase if they saw research proving that such ads would increase sales. Yet most of the survey's respondents were unaware of the numerous studies "that show the impact of increased online spending - and those who were aware discounted the results as inapplicable," the report said. "Only firsthand, positive experiences with online media will give marketers the confidence to increase spending."
Google's service is one that could provide marketers such assurances, Ms. Li said. CNET Networks Inc., the online technology publisher of Web sites including News.com, Builder.com, GameSpot and others, is offering similar services. Earlier this year, GameSpot, an informational Web site for video game enthusiasts, rolled out a program for its advertisers called GameSpot Trax, a free online service that can track various statistical results of ad campaigns.
GameSpot Trax is unusual among online advertising analysis services, CNET's chief operating officer, Barry Briggs, said, because it charts elements other than sales, like online consumer trial rates and consumer awareness via Internet inquiries.
GameSpot Trax provides statistics tracking each category for the 8,500 video game products covered by GameSpot and CNET's other game sites. For instance, for the Electronic Arts football video game Madden '04, GameSpot Trax gauges how consumer awareness has changed since its release in early August by tracking, among other things, the number of players who have visited the Madden '04 section of the GameSpot Web site, in contrast to the number who have visited the GameSpot Web pages of competing game titles.
"One marketer looked at this data and went to his C.E.O. and said 'I got tremendous awareness and consideration and trial for this game, but you know what? They hated it,' " Mr. Briggs said. "So we're giving people insight into not only their marketing but how good their product is."
One CNET advertising client, Erik Johnson, president of Ignited Minds, an advertising firm in Marina Del Rey, Calif., said such tracking services have impressed him. "If I can see what's happening, it encourages me to do even more spending," he said.
Mr. Johnson said his clients, who include major consumer electronics and video game companies like Sony, Electronic Arts and Activision, have made "meaningful changes" in their online ad spending, partly in response to better tracking of results. "In the past, they might've done $20,000 in an online campaign," he said. "Now it might be $200,000 or $300,000."
Mr. Briggs said that since Trax appeared this spring, the number of ad campaigns on GameSpot and CNET's other video game Web sites had grown by threefold, and that average spending per campaign had increased 25 percent, with the biggest marketers increasing spending by 50 percent.
In coming months, GameSpot will integrate its buying cycle data with sales statistics from the research firm NPD to help predict game sales, Mr. Briggs said. He said that next year CNET would offer advertisers on its other Web sites a similar service and start charging Trax clients a fee. "The amount you can learn is so compelling, in so many cases, that it's like the holy grail." he said.
With each passing month, online companies are increasingly able to do just that. The question is, will marketers actually respond?
Google is the latest Internet company to make good on the promise. A new feature allows advertisers to copy a string of software code from Google's Web site onto pages of their own sites. When users click on the advertiser's link from Google's Web site, Google follows the user's progress. Like other companies, Google does not collect personally identifiable information on the user.
Advertisers can log on to Google to view graphs showing how many visitors bought an item, signed up for an e-mail message or sought other information deemed significant. Armed with that information, marketers can determine if their ads are worth the expense.
"We think it's critical to help advertisers keep track of what's going on," Salar Kamangar, Google's director for product marketing, said. "We didn't want them to either overbid or underbid," he said, referring to the process by which advertisers pay for Google ads. "If they overbid, we could possibly lose them as a customer. If they underbid, they're competing less effectively than the competition."
In the three weeks since Google announced the feature, Mr. Kamangar said, the site has received stronger than expected interest from advertisers. While declining to be specific about usage, Mr. Kamangar said clients using the new service had "generally increased their bids, rather than decreased them."
The feature also helps Google avoid temporary advertising suspensions by marketers, who often test the effectiveness of their ads by simply stopping their advertising campaigns for a few days and tracking the effects on sales.
Industry analysts say the Google feature, and similar services from companies like DoubleClick, LinkShare and CentrPort, are helping a generation of marketing executives to quantify the benefits of their advertising investments.
"This isn't something most traditional marketers are used to thinking about," said Charlene Li, an analyst with Forrester Research, a technology consulting firm. "Most of these ad executives got to where they are because they ran great branding campaigns," and not by showing statistical acumen, she said.
Indeed, before the Web, the only advertising medium that made such calculations was direct mail, which many marketing executives regard as being filled with junk mailers and number-crunching catalog mavens.
"But in the last couple years, C.E.O.'s in traditional companies have been looking at budgets for all these different areas of the business and calculating the return on investment for all that spending," Ms. Li said. "Now they're finally looking at marketing budgets, too, and saying, 'You're spending $1 million on this campaign, and what exactly is it going to do for sales?' "
But even though online tools are now available to measure return on advertising, traditional marketers know little about them.
A new Forrester survey of 95 marketers, released Friday, found that 81 percent said their online ad spending would increase if they saw research proving that such ads would increase sales. Yet most of the survey's respondents were unaware of the numerous studies "that show the impact of increased online spending - and those who were aware discounted the results as inapplicable," the report said. "Only firsthand, positive experiences with online media will give marketers the confidence to increase spending."
Google's service is one that could provide marketers such assurances, Ms. Li said. CNET Networks Inc., the online technology publisher of Web sites including News.com, Builder.com, GameSpot and others, is offering similar services. Earlier this year, GameSpot, an informational Web site for video game enthusiasts, rolled out a program for its advertisers called GameSpot Trax, a free online service that can track various statistical results of ad campaigns.
GameSpot Trax is unusual among online advertising analysis services, CNET's chief operating officer, Barry Briggs, said, because it charts elements other than sales, like online consumer trial rates and consumer awareness via Internet inquiries.
GameSpot Trax provides statistics tracking each category for the 8,500 video game products covered by GameSpot and CNET's other game sites. For instance, for the Electronic Arts football video game Madden '04, GameSpot Trax gauges how consumer awareness has changed since its release in early August by tracking, among other things, the number of players who have visited the Madden '04 section of the GameSpot Web site, in contrast to the number who have visited the GameSpot Web pages of competing game titles.
"One marketer looked at this data and went to his C.E.O. and said 'I got tremendous awareness and consideration and trial for this game, but you know what? They hated it,' " Mr. Briggs said. "So we're giving people insight into not only their marketing but how good their product is."
One CNET advertising client, Erik Johnson, president of Ignited Minds, an advertising firm in Marina Del Rey, Calif., said such tracking services have impressed him. "If I can see what's happening, it encourages me to do even more spending," he said.
Mr. Johnson said his clients, who include major consumer electronics and video game companies like Sony, Electronic Arts and Activision, have made "meaningful changes" in their online ad spending, partly in response to better tracking of results. "In the past, they might've done $20,000 in an online campaign," he said. "Now it might be $200,000 or $300,000."
Mr. Briggs said that since Trax appeared this spring, the number of ad campaigns on GameSpot and CNET's other video game Web sites had grown by threefold, and that average spending per campaign had increased 25 percent, with the biggest marketers increasing spending by 50 percent.
In coming months, GameSpot will integrate its buying cycle data with sales statistics from the research firm NPD to help predict game sales, Mr. Briggs said. He said that next year CNET would offer advertisers on its other Web sites a similar service and start charging Trax clients a fee. "The amount you can learn is so compelling, in so many cases, that it's like the holy grail." he said.
Point-of-Purchase (POP) Display Programs
Premium Network Launches Full Service Point-of-Purchase (POP) Display Programs that Integrate Into Online Advertising and Web-to-Retail Promotions
Premium Network, Inc. (www.premiumnetwork.com), the leading online advertising and promotions firm, today announced it will offer full service creation of Point-of-Purchase (POP) Displays that will tie into online advertising and web-to-retail promotions.
The Premium Network Point-of-Purchase (POP) Display program provides creative and promotional services to marketers by linking in-store POP displays to online advertising programs. With the POP program, marketers will have the opportunity to expand their consumer base by utilizing Premium Network's ad network audience of over 50 million unique visitors. Online consumers would be informed about exciting in-store promotions and sweepstakes at brick-and-mortar retailers. Special coupons and premiums picked up by consumers from the retailer would then tie-in to an online component, for example, matching a coupon to an object online in order to win a prize.
Premium Network's turnkey approach integrating online and off-line promotions offers a closed loop and integrated marketing program with full accountability, as well as offering a greater ability to sell to core customers both off-line and online.
Advertisers may purchase the POP services of this program as a suite or individually. The basic services include:
Engineering and Production
Premium Network's team of POP experts will provide complete engineering and design services from basic counter card displays to elaborate motorized, die-cut, corrugated molded plastic and permanent-in store display installations.
POP Deployment
Premium Network's team will deploy POP displays direct to individual retailers and fulfillment centers to insure the display reaches destination on schedule.
POP Promotion and Sweepstakes Integration
Premium Network offers integration of its online audience of 50 million U.S. consumers to advertise product launches and direct consumers to the retail location nearest them to participate in an in-store POP promotion.
Unique Web-to-Retail Program
Premium Network creates and distributes a stand-alone custom designed POP display that holds a sweepstakes entry at retail stores. The entry form provides instant discount coupons to buy the product retail or online. Sweepstakes entries send consumers back to a mini-website to register for the promotion with a unique PIN number. Sweepstakes entries are placed in a custom designed display and can take up no more counter space than a stack of traditional trading cards or consist of an elaborate motorized floor standing display with the product on view. Sweepstakes entries can also be attached directly to product, placed inside a product box, or designed as a collectable card.
Premium Network also manages a back-end database of registrations on the promotional mini-site. Winner selections and sweepstakes prize fulfillments are managed and provided to the marketer with the name and address of each user who participates in the promotion for future marketing programs.
The more than 100 million unique monthly visitors to Premium Network's family of online sites provide far greater potential in advertising than conventional approaches used to target specific audience segments. With over 150 sites and Premium Network's core products of site-specific advertising, ad networks, and database targeting, advertisers can deliver their messages to any one of a dozen targeted categories and audience segments. Products and services available also include Strategic Ad Banners, Contest Promotions, Content Integration, Rich Media, Targeted E-Mail, Opt-in Programs, and Web-to-Retail Merchandising POP Programs.
Exceptional services, promotions, and sweepstakes are what make Premium Network the consummate one-stop advertising value.
Premium Network, Inc. (www.premiumnetwork.com), the leading online advertising and promotions firm, today announced it will offer full service creation of Point-of-Purchase (POP) Displays that will tie into online advertising and web-to-retail promotions.
The Premium Network Point-of-Purchase (POP) Display program provides creative and promotional services to marketers by linking in-store POP displays to online advertising programs. With the POP program, marketers will have the opportunity to expand their consumer base by utilizing Premium Network's ad network audience of over 50 million unique visitors. Online consumers would be informed about exciting in-store promotions and sweepstakes at brick-and-mortar retailers. Special coupons and premiums picked up by consumers from the retailer would then tie-in to an online component, for example, matching a coupon to an object online in order to win a prize.
Premium Network's turnkey approach integrating online and off-line promotions offers a closed loop and integrated marketing program with full accountability, as well as offering a greater ability to sell to core customers both off-line and online.
Advertisers may purchase the POP services of this program as a suite or individually. The basic services include:
Engineering and Production
Premium Network's team of POP experts will provide complete engineering and design services from basic counter card displays to elaborate motorized, die-cut, corrugated molded plastic and permanent-in store display installations.
POP Deployment
Premium Network's team will deploy POP displays direct to individual retailers and fulfillment centers to insure the display reaches destination on schedule.
POP Promotion and Sweepstakes Integration
Premium Network offers integration of its online audience of 50 million U.S. consumers to advertise product launches and direct consumers to the retail location nearest them to participate in an in-store POP promotion.
Unique Web-to-Retail Program
Premium Network creates and distributes a stand-alone custom designed POP display that holds a sweepstakes entry at retail stores. The entry form provides instant discount coupons to buy the product retail or online. Sweepstakes entries send consumers back to a mini-website to register for the promotion with a unique PIN number. Sweepstakes entries are placed in a custom designed display and can take up no more counter space than a stack of traditional trading cards or consist of an elaborate motorized floor standing display with the product on view. Sweepstakes entries can also be attached directly to product, placed inside a product box, or designed as a collectable card.
Premium Network also manages a back-end database of registrations on the promotional mini-site. Winner selections and sweepstakes prize fulfillments are managed and provided to the marketer with the name and address of each user who participates in the promotion for future marketing programs.
The more than 100 million unique monthly visitors to Premium Network's family of online sites provide far greater potential in advertising than conventional approaches used to target specific audience segments. With over 150 sites and Premium Network's core products of site-specific advertising, ad networks, and database targeting, advertisers can deliver their messages to any one of a dozen targeted categories and audience segments. Products and services available also include Strategic Ad Banners, Contest Promotions, Content Integration, Rich Media, Targeted E-Mail, Opt-in Programs, and Web-to-Retail Merchandising POP Programs.
Exceptional services, promotions, and sweepstakes are what make Premium Network the consummate one-stop advertising value.
Tuesday
Eleven Things That Will Happen
Lately, I've had a lot of time to ponder the state of the Internet. It's great to step back, take a big-picture look at what's been going on in the world, and try to imagine where we're going next.
I'm not interested in far-future prognosticating or Fast Company/Wired-type techno-boosterism. But many identifiable trend lines can be followed through to their logical conclusion, especially now that we have seven years' perspective of e-biz. My predictions are based on those trend lines. I truly believe they will happen... eventually. I'm not saying any of this stuff is going to come true next month, or even next year, but it's hard to imagine (barring major catastrophes) these things won't be part of our lives at some time in the future. Besides, we're already halfway through the year. No better time to beat the end-of-the-year prediction rush . So without further ado, my list of 11 things that will happen in the foreseeable future.
Given the choice between a wired tether and wireless freedom, which would you chose? Right now, those who have the opportunity and the resources to get their data wirelessly, are. With an explosion of Wi-Fi access points everywhere, soon anyone with a Wi-Fi card in her laptop will be able to hang out outside the office as long as the batteries hold out. Add to this the rapid development in small fuel cells that allow computers to run for days without a charge, and you've got a recipe for a major revolution in the way we live with computers. Beyond the laptop, phone access is getting better, palmtops and PDAs have wireless access built in, and people (early adopters, at least ) are starting to expect access.
OK, start the hate mail now. Unless something's done to stop spam, e-mail as a marketing tool will continue to erode in effectiveness until it's untenable as a legitimate tool. Several recent reports say this summer is when spam will outpace legitimate e-mail. Regardless of present or pending legislation, it's only going to get worse. Even if customers want to receive your e-mail, they'll have an increasingly difficult time finding it in the clutter.
For now, the best marketing strategy is to educate customers on setting up filters so your e-mail lands in the folder that gets read. Legitimate marketers who create desired content will continue to reach some of their audiences. Unless spam goes away, no scenario exists for e-mail to get any easier.
Blogs have gotten a lot of attention in the past six months. Many of my ClickZ colleagues have written some pretty compelling pieces about blogs' power as a marketing tool, perhaps even replacing the e-mail newsletters. Outside of its utility for marketing, blogging has taken on a life of its own. Millions of registered users blogging away. It's a new publishing medium that wouldn't have been possible without the Internet, and one that's given a meaningful outlet to many folks.
But (you knew there'd be a "but"), it's not going to last forever. As bloggers know, maintaining a blog is a lot of work. Paying people to keep on blogging can cost lots of money. Eventually, many private bloggers will move on to other things. Corporate bloggers will become too busy (or bored) to blog. As someone who ran a proto-blog for six years, 364 days a year, I know first-hand that at some point, you just run out of steam. Blogs are wonderful innovations. They emphasize the powers of the Net, personality, and instant publishing. Just don't count on them remaining the phenomenon they've been over the past year or so.
Search engines are really the main portals (more cynically, chokepoints) of the Web. The power wielded by Google, Yahoo!, Overture, and MSN is astounding. If you don't show up on search engines, you might as well not exist. In a world increasingly dependent on the Web, that's a lot of power. One that won't go unnoticed by government types (or lawyers) forever. At some point, someone's going to file a class action suit, or some legislator whose business got lousy rankings is going to say, "Hey! This isn't fair!" I don't know how attempts at regulation will pan out, but it's inevitable the government will try to get involved.
In media convergence, one plus one won't equal two. Successful convergence media will not take the form of TV over the Web, or the Web on TV. With digital cable in increasingly more homes and multifunctional devices such as cell phone/PDA combos, the trend is to "smush" more functionality into fewer devices. We aren't even close yet, but soon Web features will be combined with TV features to create a medium that acts a little like the Web and TV but looks like neither. Ditto with the cell phone/PDA/camera/GPS combos in our future.
No, I don't mean salvation. Most media folks I know are far beyond that. But in the not-so-distant future, when old-school media directors retire and those raised with the Web take their place, we'll see a religious conversion in attitudes toward digital media. Not that many haven't already discovered the Web's power -- just look at increased online spending. But someday, clients and agencies will realize the true implications of the fact the Net is the primary daytime medium. Then, all heck will break loose. This also means mass conversion to the fact ads needn't be banners.
The world's going digital and becoming a lot more measurable. Real-time measurement comes with real-time knowledge about what customers are doing, watching, and interested in. As data is used (not "collected"), knowing will be much easier. The idea of vetting TV pilots, new products, and new information using groups of 10 people will actually seem as ridiculous as it is. Qualitative data will continue to be vitally important, but as an adjunct to a constant data stream from Web sites, video on demand, and log files from a variety of devices.
Many argue AOL's troubles hinge on the company's dial-up dependence. That's probably true. But as cable expands to more homes and pricing for DSL continues to drop, dial-up will disappear for those who have a choice. It'll still be used into the foreseeable future. It's too cheap and ubiquitous to disappear entirely. But as with wireless, we must realize that, given a choice, people always choose faster. In the high-speed environment, rich media is vital, and access to more forms of data is possible for everyone.
The music industry's litigious activities are merely one symptom of a dying industry. The Recording Industry Association of America (RIAA) is exhibiting classic signs of a person diagnosed with a terminal illness. First it was in denial ("Napster is just a minor problem"). Now it's in the anger stage ("Sue the students!"). Soon, it'll move on to bargaining ("We can't stop it. Maybe we can compromise"). Finally, it'll reach acceptance and realize the need for another way of making money outside of controlling distribution of digital media on plastic discs. I'm not arguing the morality of file sharing; we're well beyond that. What I'm saying, based on the millions of users, the pace of technology, and worldwide access to the Web, is there's no way to stop it. Time to move on and come up with new business models.
Several major industries have been transformed by the power of information in the hands of consumers. Travel, auto, and health have been radically altered. That's just the beginning. As the next generation of consumers comes of age, people who never knew a time before the Web, cell phones, or IM, a lot more change will occur. Teens today expect all companies have Web sites, think e-mail is a slow communications medium (IM is, like, way faster), and are used to being able to contact anyone they want, whenever they want. They won't have a lot of patience for companies that don't open themselves up or respond quickly. This doesn't mean voice mail or IVR systems will go away. These kids are very comfortable with technology. They expect to get what they want, when they want it. If they don't, news will spread -- fast. Count on it.
Creativity as a business strategy is going to be the driving factor of success. The Internet tends to turn everything into a commodity. Consumers are accustomed to performing price and product comparisons at will. Geography is less important. The Internet provides access to pretty much anything we want, whenever we want it. Differentiation is increasingly difficult and can only occur through innovation, creativity, and all those "soft" skills that in the past were considered important, but not vital.
Creativity will be the most important strategic weapon for differentiation in the future, no matter the industry. This doesn't only mean packaging, product design, and marketing. The bar will continuously rise in terms of consumer expectations. Quality, performance, and reliability will always be givens. What will set companies apart will be the creativity applied to making products or services more delightful and exciting to buyers. Will price matter? Of course. But the intangibles make the final decision to purchase happen -- or not.
I'm not interested in far-future prognosticating or Fast Company/Wired-type techno-boosterism. But many identifiable trend lines can be followed through to their logical conclusion, especially now that we have seven years' perspective of e-biz. My predictions are based on those trend lines. I truly believe they will happen... eventually. I'm not saying any of this stuff is going to come true next month, or even next year, but it's hard to imagine (barring major catastrophes) these things won't be part of our lives at some time in the future. Besides, we're already halfway through the year. No better time to beat the end-of-the-year prediction rush . So without further ado, my list of 11 things that will happen in the foreseeable future.
1. Wireless everywhere
Given the choice between a wired tether and wireless freedom, which would you chose? Right now, those who have the opportunity and the resources to get their data wirelessly, are. With an explosion of Wi-Fi access points everywhere, soon anyone with a Wi-Fi card in her laptop will be able to hang out outside the office as long as the batteries hold out. Add to this the rapid development in small fuel cells that allow computers to run for days without a charge, and you've got a recipe for a major revolution in the way we live with computers. Beyond the laptop, phone access is getting better, palmtops and PDAs have wireless access built in, and people (early adopters, at least ) are starting to expect access.Will this happen next year?
Doubtful, but there's no conceivable scenario I can think of in which people, given the choice and the hardware, won't chose to cut Ethernet (and eventually power) cords. What will this mean to marketers? Ubiquitous data access will allow people to be smarter, make more informed decisions, and be all-around tougher customers. Will wireless advertising take off? Maybe some day, in some fashion we haven't thought of yet. For the next two to five years, we'd better expect our customers to have access to our sites, and our competitors', everywhere they go.2. E-mail: death of a marketing tool
OK, start the hate mail now. Unless something's done to stop spam, e-mail as a marketing tool will continue to erode in effectiveness until it's untenable as a legitimate tool. Several recent reports say this summer is when spam will outpace legitimate e-mail. Regardless of present or pending legislation, it's only going to get worse. Even if customers want to receive your e-mail, they'll have an increasingly difficult time finding it in the clutter.For now, the best marketing strategy is to educate customers on setting up filters so your e-mail lands in the folder that gets read. Legitimate marketers who create desired content will continue to reach some of their audiences. Unless spam goes away, no scenario exists for e-mail to get any easier.
3. Blogout
Blogs have gotten a lot of attention in the past six months. Many of my ClickZ colleagues have written some pretty compelling pieces about blogs' power as a marketing tool, perhaps even replacing the e-mail newsletters. Outside of its utility for marketing, blogging has taken on a life of its own. Millions of registered users blogging away. It's a new publishing medium that wouldn't have been possible without the Internet, and one that's given a meaningful outlet to many folks.But (you knew there'd be a "but"), it's not going to last forever. As bloggers know, maintaining a blog is a lot of work. Paying people to keep on blogging can cost lots of money. Eventually, many private bloggers will move on to other things. Corporate bloggers will become too busy (or bored) to blog. As someone who ran a proto-blog for six years, 364 days a year, I know first-hand that at some point, you just run out of steam. Blogs are wonderful innovations. They emphasize the powers of the Net, personality, and instant publishing. Just don't count on them remaining the phenomenon they've been over the past year or so.
4. Search engine regulation
Search engines are really the main portals (more cynically, chokepoints) of the Web. The power wielded by Google, Yahoo!, Overture, and MSN is astounding. If you don't show up on search engines, you might as well not exist. In a world increasingly dependent on the Web, that's a lot of power. One that won't go unnoticed by government types (or lawyers) forever. At some point, someone's going to file a class action suit, or some legislator whose business got lousy rankings is going to say, "Hey! This isn't fair!" I don't know how attempts at regulation will pan out, but it's inevitable the government will try to get involved.5. Convergence... sort of
In media convergence, one plus one won't equal two. Successful convergence media will not take the form of TV over the Web, or the Web on TV. With digital cable in increasingly more homes and multifunctional devices such as cell phone/PDA combos, the trend is to "smush" more functionality into fewer devices. We aren't even close yet, but soon Web features will be combined with TV features to create a medium that acts a little like the Web and TV but looks like neither. Ditto with the cell phone/PDA/camera/GPS combos in our future.6. Religious conversion of media folks
No, I don't mean salvation. Most media folks I know are far beyond that. But in the not-so-distant future, when old-school media directors retire and those raised with the Web take their place, we'll see a religious conversion in attitudes toward digital media. Not that many haven't already discovered the Web's power -- just look at increased online spending. But someday, clients and agencies will realize the true implications of the fact the Net is the primary daytime medium. Then, all heck will break loose. This also means mass conversion to the fact ads needn't be banners.7. Death of the focus group as primary qualitative test
The world's going digital and becoming a lot more measurable. Real-time measurement comes with real-time knowledge about what customers are doing, watching, and interested in. As data is used (not "collected"), knowing will be much easier. The idea of vetting TV pilots, new products, and new information using groups of 10 people will actually seem as ridiculous as it is. Qualitative data will continue to be vitally important, but as an adjunct to a constant data stream from Web sites, video on demand, and log files from a variety of devices.8. Universal broadband
Many argue AOL's troubles hinge on the company's dial-up dependence. That's probably true. But as cable expands to more homes and pricing for DSL continues to drop, dial-up will disappear for those who have a choice. It'll still be used into the foreseeable future. It's too cheap and ubiquitous to disappear entirely. But as with wireless, we must realize that, given a choice, people always choose faster. In the high-speed environment, rich media is vital, and access to more forms of data is possible for everyone.9. Death of the music industry as we know it
The music industry's litigious activities are merely one symptom of a dying industry. The Recording Industry Association of America (RIAA) is exhibiting classic signs of a person diagnosed with a terminal illness. First it was in denial ("Napster is just a minor problem"). Now it's in the anger stage ("Sue the students!"). Soon, it'll move on to bargaining ("We can't stop it. Maybe we can compromise"). Finally, it'll reach acceptance and realize the need for another way of making money outside of controlling distribution of digital media on plastic discs. I'm not arguing the morality of file sharing; we're well beyond that. What I'm saying, based on the millions of users, the pace of technology, and worldwide access to the Web, is there's no way to stop it. Time to move on and come up with new business models.10. The connected consumer as a major force
Several major industries have been transformed by the power of information in the hands of consumers. Travel, auto, and health have been radically altered. That's just the beginning. As the next generation of consumers comes of age, people who never knew a time before the Web, cell phones, or IM, a lot more change will occur. Teens today expect all companies have Web sites, think e-mail is a slow communications medium (IM is, like, way faster), and are used to being able to contact anyone they want, whenever they want. They won't have a lot of patience for companies that don't open themselves up or respond quickly. This doesn't mean voice mail or IVR systems will go away. These kids are very comfortable with technology. They expect to get what they want, when they want it. If they don't, news will spread -- fast. Count on it.11. The rise of the creatives
Creativity as a business strategy is going to be the driving factor of success. The Internet tends to turn everything into a commodity. Consumers are accustomed to performing price and product comparisons at will. Geography is less important. The Internet provides access to pretty much anything we want, whenever we want it. Differentiation is increasingly difficult and can only occur through innovation, creativity, and all those "soft" skills that in the past were considered important, but not vital.Creativity will be the most important strategic weapon for differentiation in the future, no matter the industry. This doesn't only mean packaging, product design, and marketing. The bar will continuously rise in terms of consumer expectations. Quality, performance, and reliability will always be givens. What will set companies apart will be the creativity applied to making products or services more delightful and exciting to buyers. Will price matter? Of course. But the intangibles make the final decision to purchase happen -- or not.
Sunday
The Real Decision Makers
I have some figures at my fingertips that I think will astound you.
Did you know a full 67 percent of families buying a new car base their purchasing decision on advice given by their children -- who are too young to drive? That 62 percent of mobile phones and 65 percent of clothing brands are bought by parents under the influence of their kids' opinions?
We're not talking only about American kids, but kids across the globe, in countries as diverse as India, Japan, Brazil, Spain, Turkey, Germany, Thailand and Denmark. The power this young generation wields over their parents has been shown to be nothing less than mind blowing.
The data comes from the world's largest study on kids and their relationship with brands. It was conducted for BRANDchild, the book I co-authored with Patricia Seybold. I call this emerging generation the tweens. They fall, roughly, between the ages of 8 and 14.
Research institute Millward Brown interviewed thousands of kids in 14 countries and 70 cities for the study. Among many startling findings that emerged, overwhelming evidence shows brand purchase decisions are increasingly being made by the children of the household. This is true across the board, in almost every product category from snacks and soft drinks to cosmetics and house wares.
In light of these findings, every message targeting the adult market must be reconceived and reframed. Marketers will increasingly have to consider how to capture the attention of two very distinct audiences in one message. They must appeal to the adult purchaser, as well as to the kid who influences them.
What does all this mean for your online strategy? As it's becoming increasingly clear you ignore this young audience at your peril, it's vital you structure your message to appeal to both markets. This will be challenging, but it must be part of your site. Obviously, some features appeal more to parents, others to their kids. The challenge is to determine what appeals to each age group, then let your site reflect this something-for-everyone. At the same time, maintain the integrity of your core message.
One method would be to build in a separate section where kids can explore your products in a more dynamic way. Language would be kid-friendly and graphically appropriate to secure their full attention.
The BRANDchild survey shows that combining a structured product presentation appeals to the adult segment, whereas a product presented in its environment appeals more to tweens. If your brand belongs the 80 percent of all product categories heavily influenced by tweens, your site should combine both product presentations. If you sell cars, you'll need to place the car in its "natural" environment, as well as in a more "clinical" space where you can demonstrate the technical facts and features. The same applies to selling home decorations.
Use of color is critical. The BRANDchild study found some colors are more appealing than others. This is dependent on what product category is offered, as well as the context in which the brand is presented. Colors you select should appeal to both audiences. It would be a mistake to think in greys.
This dual marketing is breaking through. Year after year, Toyota in Australia has maintained a top-selling position using chicks, puppies and kittens in commercials. Strange as it may sound, it works. Remember bunches of balloons waving in front of car dealerships? A small example, but fairly obvious once you're faced with the statistics of how children influence parents' purchase decisions.
Marketing to kids is so much more than simply pestering them (and their parents). It's about achieving balance. Be totally honest. Completely fulfill whatever it is you promise to deliver. This generation can detect "phony" from miles away. Youth deserves the highest ethical standards you can deliver. They're our future -- and your future brand customers!
Did you know a full 67 percent of families buying a new car base their purchasing decision on advice given by their children -- who are too young to drive? That 62 percent of mobile phones and 65 percent of clothing brands are bought by parents under the influence of their kids' opinions?
We're not talking only about American kids, but kids across the globe, in countries as diverse as India, Japan, Brazil, Spain, Turkey, Germany, Thailand and Denmark. The power this young generation wields over their parents has been shown to be nothing less than mind blowing.
The data comes from the world's largest study on kids and their relationship with brands. It was conducted for BRANDchild, the book I co-authored with Patricia Seybold. I call this emerging generation the tweens. They fall, roughly, between the ages of 8 and 14.
Research institute Millward Brown interviewed thousands of kids in 14 countries and 70 cities for the study. Among many startling findings that emerged, overwhelming evidence shows brand purchase decisions are increasingly being made by the children of the household. This is true across the board, in almost every product category from snacks and soft drinks to cosmetics and house wares.
In light of these findings, every message targeting the adult market must be reconceived and reframed. Marketers will increasingly have to consider how to capture the attention of two very distinct audiences in one message. They must appeal to the adult purchaser, as well as to the kid who influences them.
What does all this mean for your online strategy? As it's becoming increasingly clear you ignore this young audience at your peril, it's vital you structure your message to appeal to both markets. This will be challenging, but it must be part of your site. Obviously, some features appeal more to parents, others to their kids. The challenge is to determine what appeals to each age group, then let your site reflect this something-for-everyone. At the same time, maintain the integrity of your core message.
One method would be to build in a separate section where kids can explore your products in a more dynamic way. Language would be kid-friendly and graphically appropriate to secure their full attention.
The BRANDchild survey shows that combining a structured product presentation appeals to the adult segment, whereas a product presented in its environment appeals more to tweens. If your brand belongs the 80 percent of all product categories heavily influenced by tweens, your site should combine both product presentations. If you sell cars, you'll need to place the car in its "natural" environment, as well as in a more "clinical" space where you can demonstrate the technical facts and features. The same applies to selling home decorations.
Use of color is critical. The BRANDchild study found some colors are more appealing than others. This is dependent on what product category is offered, as well as the context in which the brand is presented. Colors you select should appeal to both audiences. It would be a mistake to think in greys.
This dual marketing is breaking through. Year after year, Toyota in Australia has maintained a top-selling position using chicks, puppies and kittens in commercials. Strange as it may sound, it works. Remember bunches of balloons waving in front of car dealerships? A small example, but fairly obvious once you're faced with the statistics of how children influence parents' purchase decisions.
Marketing to kids is so much more than simply pestering them (and their parents). It's about achieving balance. Be totally honest. Completely fulfill whatever it is you promise to deliver. This generation can detect "phony" from miles away. Youth deserves the highest ethical standards you can deliver. They're our future -- and your future brand customers!
