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Archive for the ‘eCommerce’ Category

Soon, you’ll have to pay for Hulu

Posted by John Cooper on June 4, 2009

Article Link: dailyfinance.com

Article Author: Jeff Bercovici

Article Date: 03-June-09

From the Article:

I think what works for consumers most likely — and this has to be tested, frankly — is bundles. I think you have to figure out what are the right bundles that people buy and what’s contained in that bundle. For example, you could have — and I’m making this up entirely — you could have a New York bundle, and that could consist of various papers or publications that are relevant to the audience in New York, and you could make that all, potentially, a bundle to a consumer at one price.

Posted in Content, eCommerce, Marketplace Trends, Television & Video | Leave a Comment »

Twitter Proves Its Worth as a Killer App for Local Businesses

Posted by Mort Greenberg on May 18, 2009

Article Link:  Ad Age 

Article Author:  ABBEY KLASSEN

Article Date:  18-May-09

TWITTERPIZZA

From the Article :

“Naked Pizza, a New Orleans healthful-pizza shop that’s hoping to go national — Mark Cuban is a backer — has been marketing itself via the microblogging service. And recently it has started to track Twitter-spurred sales at the register. In a test run April 23, an exclusive-to-Twitter promotion brought in 15% of the day’s business.”

 

http://adage.com/digital/article?article_id=136662

Posted in Ad Creative, Ad Products, Ad Spending, Consumer Behavior, Data & Metrics, eCommerce, Marketplace Trends | Leave a Comment »

Marketers must join media to get slice of online pie

Posted by Mort Greenberg on November 2, 2008

Article Source: http://www.tennessean.com

Article Link: http://www.tennessean.com/apps/pbcs.dll/article?AID=/20081102/BUSINESS01/811020414/1003/RSS6004

Article Author: Jeff Cornwall 

Article Date: 2-Nov-08

 

“All media outlets, especially local media, need to get better at monetizing the digital expressions of their core properties. (Translation: They need to make money online.) Marketers who depend on those local media need to grasp this concept.

Local media sites also perform strongest with the heaviest spenders. Almost half of local magazine site visitors spent more than $500 online in the past 12 months.

So what types of businesses are consumers looking for when going to local sites? Restaurants and bars lead the list. Grocery stores, banks and financial services, department stores and physicians and health facilities round out the top five.

Consumer electronics stores, auto dealers and auto service, real estate, furniture and appliance stores and legal services complete the top 10 sites.

Marketers and agencies must accept the new media reality and understand the options available to communicate with their customers. It may sound ironic, but while the World Wide Web helps us think globally, it allows us to act locally. ”

 

CLICK TO READ FULL ARTICLE

Posted in Ad Spending, Consumer Behavior, eCommerce, Local, Marketplace Trends | Leave a Comment »

Mobilenet Promises to Be the Next Big Medium

Posted by Mort Greenberg on May 7, 2008

Article Source: http://adage.com

But Don’t Get Sidetracked Into Third-Screen Thinking

Published: May 06, 2008

We are on the verge of witnessing the birth of a new mass-communications medium. It’s the second new mass medium to appear in the last two decades.

The internet arrived in the 1990s, joining the other four mass media: 1) The book 2) The periodical 3) Radio 4) TV. Each new mass medium has created enormous upheavals in society.

  • The book ignited the knowledge explosion.
  • The periodical furthered the growth of democracy.
  • Radio created a celebrity-oriented society.
  • TV homogenized the culture.

The internet, the latest and newest mass medium, continues to make waves. “We are not witnessing the beginning of the end of old media,” Advertising Age’s Bob Garfield wrote recently. “We are witnessing the middle of the end of old media.”

“Both print and broadcast — burdened with unwieldy, archaic and crushingly expensive means of distribution — are experiencing the disintegration of the audience critical mass they require to operate profitably,” Mr. Garfield continued. “Moreover, they are losing that audience to the infinitely fragmented digital media, which have near-zero distribution costs and are overwhelmingly free to the user.”

Fasten your seat belts. On the horizon, there’s another profound shift in media, consumer behavior and technology coming. In the near future we are likely to welcome the arrival of a sixth mass-communications medium.

And what is this earth-shaking new medium? It’s the Mobilenet.

The what? Surely you are joking, Al. The Mobilenet is just a subset of the internet. Just another way of going online. Just another way of surfing the net without using a computer. That’s why mobile devices are commonly called the “third screen.”

Third-screen thinking is going to cause you and your company to miss the boat. Which big brands were created by moving content from one medium to another? Very, very few.

  • Moving The Wall Street Journal online didn’t save Dow Jones from the clutches of Rupert Murdoch for just $5 billion.
  • Moving ESPN onto cellphones didn’t take it to the big leagues.
  • So far, moving TV shows to the internet hasn’t created as much value as one internet site, YouTube.com. Less than 20 months after its launch, YouTube was bought by Google for $1.65 billion.

Google can afford to splurge. In the first quarter of this year, Google had net income of $1.3 billion. In the same quarter, The New York Times Co. lost $350,000. Moving the Times to the internet didn’t solve the company’s financial problems. Last year, NYTimes.com had estimated revenue of $27.6 million, pretty small potatoes for a site that was launched more than 11 years ago.

In spite of its dubious record, the content movement continues to gain momentum. The telecoms plus the TV industry are making massive efforts to move TV to cellphones, in spite of surveys that show, according to Yankee Group analyst Linda Barrabee, only 5% of U.S. consumers are willing to pay for mobile TV.

The software industry is also spending a fortune developing programs to permit these inter-medium transfers. Two weeks ago, Microsoft unveiled “Live Mesh,” a software program to link all internet-enabled devices. “Not just PCs and phones,” reported Ray Ozzie, the company’s chief software architect, “but TVs, game consoles, digital picture frames, DVRs, media players, cameras and camcorders, home servers … our car’s entertainment and navigation systems and more.”

That’s the wrong approach. A new medium calls for new brands, not for extensions of existing brands. The internet didn’t reward traditional brands like The Wall Street Journal, The New York Times, ABC, NBC, CBS, Barnes & Noble and Hallmark. It rewarded new brands created especially for the net. Dot-com brands like Amazon, eBay, Yahoo, Expedia, Netflix, MySpace, Facebook and AOL.

The Mobilenet will also reward new brands created especially for the medium. Like Loopt, a service that lets people with GPS-equipped phones share their real-time locations with friends.

A slimmed-down, warmed-over dot-com brand isn’t going to make it on the Mobilenet.

Laying the foundation
The Mobilenet, of course, isn’t going to become an overnight success. (The internet didn’t either.) A number of developments need to come first.

On the sending side, the missing ingredients are the dot-mobis that will make the receiving device a universal, carry-everywhere product much like the cellphone.

On the receiving side, the missing ingredient is a gadget that integrates telecom service with three technologies in an attractive and convenient package: 1) GPS, global-positioning-system receiver; 2) scanner; and 3) voice-recognition software.

Oddly enough, the most heavily hyped new product of the 21st century (Apple’s iPhone) doesn’t include any of those three technologies. Too bad. With all of Apple’s brilliant design and technology skills, the company could have pioneered and dominated the Mobilenet for decades to come.

Instead, Apple perfected the smartphone, a convergence device destined to remain a niche product. The first smartphone (the Nokia 9000) was introduced 12 years ago. Yet today the smartphone accounts for only 10% of the global cellphone market.

In the last quarter, Apple sold 1,703,000 iPhones, about 6% of the global smartphone market. Not exactly earth-shaking results. In the same quarter, Apple sold 10,644,000 iPods, about 70% of the MP3-player market.

Besides market share, there’s another striking difference between the two products. The iPod, a divergence device, pioneered a new category. The iPhone, a convergence device, was not designed to create a new category, but to improve on an existing category, always a risky strategy for a would-be market leader.

Dawn of a new device
If the Mobilenet is a new mass medium, what would you call the receiving device? The logical name is “MobiPhone,” to reflect the millions of dot-mobi websites sure to come.

Names don’t always describe what a device is really used for. Most people do little “computing” on a computer. (I do my computing on a printing calculator.) A MobiPhone may not necessarily include a cellphone. Many people might like a separate device to make telephone calls.

Obviously some people are thinking along similar lines. To me, the most interesting news item of the month was Nokia’s purchase of Navteq, a firm that collects map data from around the world, for $8.1 billion.

Eight-point-one billion? That’s one and a half Wall Street Journals for a company with revenue of just $853 million last year. That mind-boggling number tells you what the folks in Finland are thinking about. It ties in with the thought that the GPS receiver will be the key function of future telecom devices.

The global positioning system, like every technological change, creates the conditions for a product or a medium to diverge in the same way that environmental changes create the conditions for a species to diverge.

Mobile marketing would snowball
First the internet; now the Mobilenet. That’s how divergence works. Furthermore, the Mobilenet promises to make the dream of mobile marketing a reality.

Up till now, mobile marketing has captured a trivial slice of the advertising market ($708 million last year) even though the cellphone predates the worldwide web.

The potential Mobilenet marketplace dwarfs the internet. Last year more than 1.15 billion mobile phones were sold worldwide, compared to only 271.2 million personal computers. In other words, more than four times as many mobile phones were bought than PCs. And, in my opinion, most consumers will find a GPS-equipped MobiPhone to be a device they can’t live without.

The MobiPhone is not just another device, of course. It’s the receiving end of another medium, one that is unique and different from the internet. And one likely to be larger and more universal than the internet. Companies that want to take advantage of this new medium will quickly register their company and brand names as dot-mobi domain names.

Furthermore, each dot-mobi website should be considered separately from the company or the brand’s dot-com website. Two different media demand two different approaches. (You wouldn’t run a radio advertisement on TV, so why would you run a dot-com program for a dot-mobi audience?)

Long-term, “mobile” is going to become a very important part of the overall marketing environment in America. What kinds of advertising approaches are best suited to the new mobile medium?

Consumers empowered
In my opinion, there are two types of advertising: one that might be described as “passive” advertising, the other as “active.”

Passive advertising is conventional advertising found in newspapers, magazines, radio and TV. It interrupts the reader, listener or viewer in order to present “a message from the sponsor” of the medium.

Active advertising, on the other hand, is initiated by the consumer. Search advertising on the internet is a typical example. But there’s active advertising in conventional media, too. In particular, classified advertising in newspapers and telephone directories. Roughly 40% of all advertising on the internet is “active.” This is what has made Google such a big success.

The Mobilenet is going to be an even bigger medium for active advertising than the internet. That’s why there is a golden opportunity for a Google-like brand specially designed to search dot-mobi websites and coordinate with the user’s exact location.

But that’s only the beginning.

A MobiPhone with a 2D barcode scanner will enable consumers to get a wealth of information by scanning products in supermarkets, drugstores, clothing stores.

MobiPhone users might be able to arrange to be notified when certain things occur; for example, when a celebrity shows up at a restaurant or nightclub.

It’s easy to visualize what a useful device a MobiPhone could be if it is served by appropriate dot-mobi websites.

  • What’s the speed limit? (Maybe we can avoid those huge pileups that sometimes occur in heavy fog by automatically lowering speed limits when visibility is impaired.)
  • How far is the next exit and what facilities can be found there?
  • Without stopping to read them, what do those historic markers actually say?
  • Location of the nearest hotel/motel and the price of a room?
  • Location of the nearest gas station and the price of gasoline?
  • Location of the nearest restaurant by type and price level?
  • What’s the Parker number on that bottle of wine? (One of the many facts that might be available by simply scanning a label.)

What consumers can do with the receiving device is not the most significant aspect of the Mobilenet. More significant are the changes in structure the new medium will facilitate.

For example, taxicab dispatch systems are likely to disappear, since a consumer will be able to see the location of the nearest available cab and call one directly. Similar changes are likely in all types of dispatching systems.

Consumers will find many other ways to use a MobiPhone. Every August for the last eight years, my wife and I have driven around the scenic areas of the Southwest. Every afternoon on those trips, we would keep an eagle eye out for a Dairy Queen in order to snare a couple of their chocolate-dipped cones.

Hopefully, next year we’ll check DQ.Mobi instead.

~ ~ ~
Al Ries is the author or co-author of 11 books on marketing including his latest, “The Origin of Brands,” which discusses how the Darwinian concept of “divergence” applies to the world of business. He and his daughter Laura Ries are partners in the marketing strategy firm Ries & Ries. Their website: http://www.ries.com.

Posted in Brand Advertising, Consumer Behavior, Content, eCommerce, Local, Marketplace Trends, Mobile, Multi-Channel | Leave a Comment »

Do-It-Yourself Display Ads

Posted by Mort Greenberg on May 7, 2008

Article Source: http://wsj.com

 

By SHIRA OVIDE
May 7, 2008; Page B3B

Much of the valuable online-ad real estate is sold the old-fashioned way: through a salesperson.

But now start-ups and major Internet players such as Facebook Inc. are giving advertisers the option of planning, buying and tracking online-ad campaigns all on their own. Just as the ability to buy plane tickets online steered business away from travel agents, the self-service options promise to shake up the $20 billion online-advertising market.

Google Inc. built a $185 billion company largely thanks to its self-service model for buying the online text ads that show up in Web searches. The next front in do-it-yourself is the display-ad market. Display ads are expected to be 40% of the online-ad market in coming years. Until recently, such ads were too expensive to buy and too difficult to create for many companies.

“In order to really move into large masses of advertisers, display advertising has to be easier and simpler,” said Ajay Agarwal, managing director of Bain Capital Ventures. “Google did this with search advertising. We think the same thing has to happen with display.”

The self-service options have the potential to bring huge numbers of new advertisers and sites into online advertising, including small firms that currently find it too difficult or expensive to advertise online, or to advertise at all.

 

Andy Dunn is one of the new do-it-yourself-ers. Mr. Dunn is chief executive of Bonobos Pants, an online clothing company that says it makes “pants for real guys,” aimed at men who want well-tailored and fashionable clothes but hate to shop in stores. The company, which the 29-year-old Mr. Dunn launched last fall with a classmate from the Stanford Graduate School of Business, initially didn’t do much to market its wares. “We think advertising is pretty wasteful for a company like ours,” Mr. Dunn said.

But for a pants line aimed at Chicago Cubs baseball fans, Bonobos took a chance on Facebook’s new self-service ad system. In less than five minutes, Bonobos created ads that would be seen only by young men in the Chicago area who identified themselves on their Facebook profiles as Cubs fans. With a picture of the “Cubbie blue” pants — named Clarks, after one of the streets surrounding the Cubs’ home of Wrigley Field — and simple ad taglines like “pants for Cubs fans,” the ad was seen more than 250,000 times. Quickly, Bonobos sold out of Clarks, at $120 a pop. Total cost for the ads: about $63.

Mr. Dunn said that next time, he may spend thousands of dollars more on the Facebook ads. “It’s so economically compelling that we can’t ignore it,” he said. “This was five minutes of our time, and we sold through these very specific pants that otherwise we’d have a hard time finding our audience.”

Facebook is only one of a rising number of self-service ad options. There are new entrants such as AdReady Inc., AdBrite Inc. and AdItAll LLC. MySpace, like Facebook, is offering do-it-yourself ads that marketers can tailor to individual interests on the social-networking site. (MySpace, like this newspaper, is owned by News Corp.)

Time Warner Inc.’s AOL Internet unit and Google have new self-service ad options for the opposite side of the equation — for Web publishers who want to attract advertising to their sites.

The rising number of self-service options underscores the expanding market for display ads, the graphic- and video-heavy ads in fixed spots on a Web page. The market for display ads reached $5 billion in 2007, according to market-research firm eMarketer Inc. That is far less than the estimated $8.6 billion in spending for text ads tied to online search. But in coming years, the mix is expected to tilt in favor of display ads, thanks to the rise of online video and the increasing push of brand marketers such as car companies into the display market.

But for the majority of mostly small- and medium-size businesses, it remains too difficult and expensive to buy display ads. To create an ad, businesses have to navigate the 15 standard sizes and half dozen standard formats and design something that will be eye-catching. They have to pick which Web sites or networks to buy ad space from, test multiple ads, track which ones draw the best consumer responses and adjust marketing campaigns accordingly. Doing this alone is daunting, and paying an ad agency to do it might cost thousands of dollars. Sites such as Yahoo Inc. often require advertisers to promise they will spend tens of thousands of dollars a month on advertising.

“There’s no real solution for the smaller advertiser who wants to enter the display market,” said Aaron Finn, chief executive of AdReady, one of the new companies offering access to the market. Mr. Finn used to head marketing for Classmates.com, one of the biggest buyers of online ads, and launched AdReady last fall with backers such as Bain Capital LLC’s Bain Capital Ventures.

AdReady promises to ease the headaches and guesswork and to lower the costs associated with buying display ads. A Ford dealership in California can pick from a pool of templates and customize an image of a revolving Ford car with the dealership logo and contact information. Then, the dealer can buy ad space through AdReady on major Web sites targeted to reach only Web surfers in California. The system suggests tweaks, such as making the ad background purple rather than white, that have proven to draw more people to click on ads. Advertisers can spend as little as $20, and AdReady is paid a cut of the ad buy.

AdReady and other services also give advertisers the ability to tie ad spending to results. For example, an advertiser could see how many people viewed a car ad and how many people clicked on it. The car dealer could then decide it wants to turn off the ads that received the fewest clicks and run more of the ads that were more effective.

By drawing in new ad buyers, the self-service options also aim to address one of the nagging problems with the display-ad market: cheap prices.

As a flood of new Web sites compete for consumers’ eyeballs, sites such as Facebook are having difficulty raising prices for ads. The cost for reaching a thousand Web visitors can be as little as a few cents on Facebook or MySpace. Reaching the same number of viewers of a prime-time TV show can cost $30.

By widening the pool of advertisers vying for display space, sites believe they can increase the prices for their ads. Facebook Ads is seeing a huge influx of first-time Internet advertisers, according to Tim Kendall, director of monetization at Facebook.

Along with innovations such as ad networks, self-service options are hoping to do for the display-ad market what Google did for search: make it more accessible, cheaper and, ultimately, a much-larger business.

“There’s a huge market that’s still being untapped,” Mr. Finn said. “I think you’re going to open up the floodgates.”

Write to Shira Ovide at shira.ovide@dowjones.com1

Posted in Ad Products, Ad Spending, Ad/Behaviroral Targeting, Direct Response/Email, eCommerce, Local, Marketplace Trends | Leave a Comment »

Olay Translates Killer Online App to Retail Aisles

Posted by Mort Greenberg on April 21, 2008

Article Source: http://adage.com

P&G Looks to Enhance Real-World Wal-Mart Shopping With Web Tools

By Jack Neff

Published: April 21, 2008

BATAVIA, Ohio (AdAge.com) — Procter & Gamble Global Marketing Officer Jim Stengel ranks it among the company’s best digital initiatives, and Chairman-CEO A.G. Lafley called it out to analysts in February as a prime example of innovation.

Kiosks are taking info from online to in-store.
Kiosks are taking info from online to in-store.

But it’s not just P&G that’s impressed with Olay for You, an online product- recommendation program that’s attracted more than a million visitors since January, 80% of whom completed an involved question-and-answer process and spent an average of eight minutes on the site.

Wal-Mart Stores has begun testing an in-store version of Olay for You via kiosks in stores, marking the latest of several efforts in which offline retailers are looking to tap the convenience and functionality of online tools, such as search and recommendation engines, to improve the often-annoying offline shopping experience.

It may not be a bad idea. Even as overall retail sales started tanking late last year, online retail sales were growing at healthy double-digit rates, according to ComScore and Nielsen Online.

Ease in the aisle
For the growing number of consumers who prefer the online experience to traditional shopping, the ease of finding products and getting recommendations clearly is a draw, said Carter Cast. Mr. Cast, a former CEO of Walmart.com and head of strategy for Wal-Mart Stores in the U.S., became CEO of fledgling specialty online retailer Netshops late last year.

Because of expectations created by web shopping, consumers increasingly expect offline stores to have the goods they want and make them easy to find, Mr. Cast said. “So the ante is raised in the physical world.”

Unfortunately, stores aren’t always anteing up. “I’ve read statistics that show a surprisingly high number of people [more than 10%] will go into a big-box and leave without [buying anything] because they haven’t found what they want,” he said.

Though he hasn’t seen some of the newer systems in stores, such as the Olay system being tested by Wal-Mart and P&G, he said they have potential. Mr. Cast also said more retailers will look to mimic the online experience by porting inventory data from their stores to their websites to give consumers real-time information about product availability.

OTC offline
Another take on the online-to-offline phenomenon is Evincii, which began installing kiosks offering a mix of search and recommendation-engine capabilities in the over-the-counter-drug sections of Longs pharmacies in California in 2006 and is looking to roll out the concept nationally.

Johnson & Johnson is an initial advertiser on the system, which allows advertisers to place ads similar to online display ads, including video, around search results.

But like Google or other search engines, Evincii looks to return “organic” results only based on the criteria shoppers input, such as their symptoms, said Charles Koo, CEO of the private-equity-backed venture. Then, once they’ve selected a product, the kiosk helps them locate it on the shelf.

Not only does Olay for You appear to have had unusual success — consumers like the site so much that about 7% have contacted P&G’s consumer-relations staff to say so, more than double the average for online initiatives — it also comes from an unusual source. It was created by Talk Me Into It, a digital agency founded last year by Marie McNeely, a former global equity director on P&G’s fabric and home-care business for Saatchi & Saatchi, which handles creative duties both for Tide and Olay. It’s the first project for Talk Me Into It, which has offices in New York and New Zealand.

Helping hand
The idea was largely to help Olay, and consumers, cope with a downside of the brand’s success over the past eight years: A proliferation of products and product ranges has made it difficult, particularly for newcomers to the brand or category, to know what they should buy or even where they should start in making a decision, a P&G spokesman said.

While P&G has tried in-store kiosks before with such brands Clairol and Millstone coffee, Olay For You’s combination of a highly graphic, iterative interview process and a soothing female voice may come closest to actually simulating a customer-service rep.

But while all the systems sound like good ideas, James Sorenson, exec VP-retail and shopper insights for TNS Sorenson, said getting consumers to search online in the store may be a nonstarter. While consumers might be willing to spend the time to do search queries from the comfort of their homes, doing it in stores is another matter, he said.

Mr. Koo, however, said Evincii’s research at Longs indicates that 15% to 18% of visitors to OTC-drug departments use the kiosks, numbers similar to those that ComScore found last year of consumers who use online search to research package goods. Stores using the kiosks, he said, had category sales lifts of 3% to 6%.

“That was a surprise to everybody, because we thought initially it was just a good vehicle for advertisers,” Mr. Koo said. “But it certainly helped retail sales, too.”

Posted in Ad Products, Ad/Behaviroral Targeting, Brand Advertising, Consumer Behavior, Demos & Audiences, Digital Out of Home, Direct Response/Email, eCommerce, Local, Marketplace Trends | Leave a Comment »

TV Networks Seek Formula for Online Ads

Posted by Mort Greenberg on April 14, 2008

Source: http://ap.org

 

 

Apr 12, 5:49 AM (ET)

 

By RYAN NAKASHIMA

 

LOS ANGELES (AP) – CBS Corp. (CBS) executives took an unusual risk last fall before its series debut of “Big Bang Theory” – it offered the entire episode online despite the chance it would sap viewership for the TV premiere.

 

The show, about two geeky physicists and their beautiful female neighbor, got 90,000 views on CBS.com and other Web sites over a week, followed by a better-than-expected 9.5 million for the Sept. 24 on-air premiere.

 

“The thought was purely to try to find new eyeballs in a medium that generally appeals to younger demographics, and then drive them to put butts in seats to watch on their beautiful plasma-screen TV when the series takes off,” said Quincy Smith, president of CBS Interactive. “It was fairly radical, and we’re happy with how it came out.”

 

Looking to tap new revenue through online ads, attract new viewers and keep loyal fans, broadcast networks are making bigger, riskier bets on Internet delivery of their shows. The challenge is to grow viewership online without cannibalizing traditional ratings and DVD sales while making more money on programming seen on the Web.

 

 

But online audiences are still limited, a stumbling block that’s expected to be a hot topic at the National Association of Broadcasters’ annual gathering, which starts Monday in Las Vegas.

 

According to comScore Media Metrix, ABC.com led the network pack with 8.5 million unique visitors over its entire lineup of shows for the whole month of February, followed by NBC.com with 7.9 million. By comparison, a single episode of CBS’s “CSI” recently took in more than 20 million TV viewers in one night.

 

Still, there are signs that the online experimentation will pay off.

 

Networks now charge more per thousand viewers online than they do over the airwaves, where the average for a primetime show is about $25. Analysts put the online rate anywhere from $35 to $50 per thousand, though there are millions more potential traditional TV viewers.

 

Advertisers pay more online because there is a better accounting of how many viewers see the ads and an extra benefit that an impulse to purchase can be acted on with the click of a mouse.

 

“For an advertiser, you’re getting a clear performance result,” said Bob Davis, a Web investor and former CEO of search engine Lycos. “No matter what the click-through (rate) they get, it’s infinitely larger than the click-through they get on TV. The click-through they get on TV is zero.”

 

ABC, which streams “Lost” and “Desperate Housewives” on its ABC.com site after airing on TV, is aiming to tweak its formula to make its online ads as lucrative as its TV ones.

 

“In order for us to drive the number up to what we get on broadcast, we have to do one of two things. We have to either increase the number of ads that you currently see on ABC.com or figure out different ways to generate value for advertisers,” said Albert Cheng, executive vice president of digital media for the Disney-ABC Television Group.

 

“We are not at parity yet with broadcast, but the goal and everything that we are doing is to drive toward parity,” he said.

 

The CBS experiment with “Big Bang Theory” was so successful that the network repeated the online-preview formula with two other shows, “Dexter” in February and “The Tudors,” on the CBS-owned pay cable channel, Showtime, in March.

 

ABC, a subsidiary of The Walt Disney Co., expects to explore the effectiveness of localized advertising in test markets in the next several months, because its media player can detect the location of the online viewer, Cheng said.

 

Technology companies also are working to style ads that will be more interactive, leading to higher sales – such as making products that appear in shows clickable – or targeting viewers based on what kinds of content they have seen recently.

 

“Ultimately, where the Internet will really become a powerful source of revenue is that all forms of advertising will work in a highly targeted way,” said Steve Mitgang, chief executive of Veoh, a Web site that streams ad-supported shows. For TV shows at least, ad-supported free viewing online has proved more profitable than fee-based video downloads on services like Apple Inc. (AAPL)’s iTunes, said George Kliavkoff, chief digital officer of NBC Universal.

 

NBC Universal, a unit of General Electric Co. (GE), stopped supplying its hit TV shows to iTunes last year. Instead, it teamed up with News Corp. (NWS) to launch hulu.com, a Web site that went public last month and streams shows like “Battlestar Galactica” and “The Office” for free with ads.

 

The NBC Universal-News partnership, as well as CBS, are testing a “ubiquitous” approach, making their content available across dozens of Internet partner sites, including YouTube, rather than drawing viewers to a single destination.

 

It’s not clear which model of delivery will prevail. None of the networks disclose how much ad revenue they collect from online show streams, but all have made major investments in what is a growing business.

 

“We’re sort of in the first inning of how some of these digital platforms will develop,” said Kliavkoff. “We still don’t know what the winning business model will be at the end.”

Posted in Ad Products, Ad Spending, Ad/Behaviroral Targeting, Brand Advertising, Consumer Behavior, Demos & Audiences, eCommerce, Marketplace Trends, Television & Video, Traditional to Online | Leave a Comment »

Staples Keep Ad Market Afloat

Posted by Mort Greenberg on April 9, 2008

Source: http://wsj.com

By SHIRA OVIDE and ANJALI CORDEIRO
April 9, 2008

Yogurt, cheese and Froot Loops may provide a much-needed life raft to the advertising market.

While overall advertising spending is threatened by the battered economy, makers of household staples, such as General Mills Inc. and Kraft Foods Inc., are holding the line or increasing their ad and marketing budgets, partly to try to make sure penny-pinching shoppers don’t switch their favorite shampoo or macaroni for a cheaper off-brand substitute.

“As they’re battling for shelf space for their brands and products, one of the things to back that up is advertising and marketing support,” said Jon Swallen of market-research concern TNS Media Intelligence.

In 2007, companies making consumer products such as food and drugstore salves increased their ad spending by 8% or better, even as the overall ad market was nearly flat, according to TNS. That’s significant because makers of such household staples are big spenders, responsible for roughly one in 10 ad dollars spent in the U.S.

While continued strong spending by such companies is unlikely to lift the whole ad market, especially if advertisers move to nonconventional pitches, it at least offers a spot of good news to media companies hurt by overall slower ad growth.

Hearst Corp., publisher of Good Housekeeping and Cosmopolitan magazines, reported its most profitable year in 2007. Nearly a dozen top accounts each juiced spending by $30 million more in Hearst magazines last year, led by an 80% jump from Campbell Soup Co., according to Jeff Hamill, senior vice president of Hearst’s corporate advertising unit.

Consumer-product companies say increasing marketing costs translate into higher sales.

General Mills, which makes Cheerios cereal, Hamburger Helper and other pantry favorites, raised consumer-marketing spending by 13% for the third quarter ended in February. The company posted a 12% sales increase for three months ended in February, a jump General Mills credited to its ad spending uptick.

“We believe this investment is and will continue to fuel sales growth,” Chief Financial Officer Don Mulligan told investors last month.

Last year, Kellogg’s ad spending rose 16% to $1 billion, and the cereal maker isn’t backing off. “We believe that continued investment in our brands increases our dependability as a company,” Kellogg Chief Executive David Mackay said at a conference in February, when he discussed his company’s increases in ad spending.

Overall Market

The pickup in some categories, however, may not be enough to salvage the overall advertising market. Forecasts are calling for U.S. ad spending to grow at an anemic pace of 4% or slower this year, even with the significant lift expected from the U.S. presidential election and the Summer Olympics. In 2004, the last presidential and Olympic year, the pace of growth was about 10%.

The ad pain results from a storm of factors. Many financial-services firms, battered by the housing-lending crisis, are paring marketing. General Motors Corp. and other top advertisers in auto, media and telecom are cautious, too, spurring ad watchers to retreat from their spending forecasts in recent months.

Robert Coen, the closely watched ad-spending maven at Interpublic Group of Cos.’s Universal McCann, expects ad spending to be 3.7% higher this year than in 2007, down from a 5% increase he initially expected. Others also are wary.

“No question this is going to be a challenging year,” said Richard Beckman, chief marketing officer of Conde Nast Publications. “As the economy goes, so goes the advertising market.”

However, media companies and ad-agency giants say they haven’t felt any advertising pullback, for the most part. But pessimistic observers say ad budgets, set months in advance, have not caught up with the cooling economy yet. The second quarter or later could start reflecting the ad weakness in media companies’ bottom lines.

Madison Avenue acknowledges the weakness but says advertising and media will weather the economic storm.

“The truth of the matter is there are too many people saying the sky is falling,” Mr. Beckman said.

Media companies say they’re benefiting as companies focus less on winning low prices for ad pages or TV air time. Instead, media outlets and advertisers are working more closely together to develop elaborate and potentially pricey full-service ad campaigns.

Hearst worked with Unilever NV’s Dove on a campaign for hair-care products. Ads ran in the magazine, and Hearst created a Web site called “Love Your Hair,” packed with content and video touting the benefits of Dove’s wares.

Non-Traditional Spending

Consumer-staples companies can afford to boost ad spending because their sales hold steady even in a weaker economy. But even as they pitch their wares, not all of their dollars may go toward traditional advertising.

“You could see shifting of some marketing dollars into the store,” said Jason Gere, a household-products analyst at Wachovia Capital Markets.

In-store merchandising can refer to anything from the way products are displayed to signs. About 70% of consumers’ purchasing decisions are believed to be made while in the store.

“It’s important the message inside the store is just as sharp, particularly in a weaker economy,” Mr. Gere said.

Other deep-pocketed companies are spending in different ways, homing their marketing on a few important brands or key consumer groups.

“We are spending more, but not in ways we always have,” says Doug Moore, vice president for advertising at General Mills. The company, for instance, is spending more on digital marketing and targeting Hispanic consumers with ads in Spanish for Yoplait and Honey Nut Cheerios.

Anheuser-Busch Cos. plans to allocate 10% more for media spending this year compared with 2007 spending, but the leading U.S. brewer has shifted its budget to focus on a few key brands such as Budweiser and Bud Light beers.

Marketers continue to shift ad money to the Internet, where overall ad costs are lower. Online advertising also produces measurable results, arming strapped marketing executives with spreadsheets to prove that their ad campaigns rang digital cash registers.

Consumer-products companies spend about 3% of their ad budgets on online advertising, less than half of what auto makers and other major advertisers spend in that area. The slipping economy may, however, push more advertising dollars toward the Internet.

Write to Shira Ovide at shira.ovide@dowjones.com and Anjali Cordeiro at anjali.cordeiro@dowjones.com

 

 

Posted in Ad Spending, Brand Advertising, Consumer Behavior, Data & Metrics, Demos & Audiences, eCommerce, Marketplace Trends, Media Company Stocks | Tagged: , , | Leave a Comment »

News Highlights: Behavioral Targeting

Posted by Mort Greenberg on April 9, 2008

Source: http://news.google.com

Behavioral Targeting: Why This Hot Technology is Burning its Users
WebProNews, KY – 12 hours ago
Behavioral targeting (BT) has been around since the first dotcom days. In late 2007 it rose to fame again thanks to a few big promoters like Facebook;
Targeting with Culture in Mind
ClickZ News, NY – 7 hours ago
By Vicky Chen, The ClickZ Network, Apr 9, 2008 Behavioral targeting has evolved from tracking consumers’ online action to evaluating their mindsets and
FTC Divided Over Online ‘Behavioral Targeting InformationWeek
all 4 news articles »
How To Use, Really Use, Behavioral Targeting
Mediapost.com, NY – 19 hours ago
You can hardly open up your browser these days without hearing about behavioral targeting. Well, buckle up–because the fun is just beginning.
Behavioral Targeting: Chicken Soup for Recession’s Soul
ADOTAS, NY – Apr 7, 2008
If so, then it’s time to change our behavior. What behavioral targeting has always offered is a way to engage with our target audience in a way that is
AMC Hopes To Alter Upfront Buying Behavior, Offers TV Guarantees
MediaPost Publications, New York – Apr 7, 2008
The behavioral targeting component of AMC’s 2008-09 upfront sales strategy is part of a suite of new audience metrics developed by the channel,
Just An Online Minute… European Regulators Propose Stricter
Mediapost.com, NY – 15 hours ago
Bills are pending in New York and Connecticut that would regulate behavioral targeting. These bills, still in early stages, would require companies to allow
On Ad Networks: Pork Bellies, Diamonds, Or The New Direct Marketing?
Washington Post, United States – 16 hours ago
All about pricing: Sarah Welch, co-founder and COO, Mindset Media, an ad network specializing in “psychographic” behavioral targeting, noted that a lot of S – WPO
Spying on Internet users
International Herald Tribune, France – Apr 7, 2008
The big growth area in online advertising right now is “behavioral targeting.” Web sites can charge a premium if they are able to tell the maker of an
Behavioral Targeting Still Concerns Consumers
eMarketer, NY – Apr 1, 2008
“Education once again appears to be the key to finding a constructive balance between behavioral targeting and consumer privacy,” said Fran Maier,
Consumers Well Aware of Behavioral Tracking, Targeting – Don’t
Media Buyer Planner, MD – Apr 1, 2008
Marketers use behavioral targeting to deliver a more customized experience (ie, relevant ads) and to improve their marketing metrics, but they run up

Posted in Ad Products, Ad Spending, Ad/Behaviroral Targeting, Data & Metrics, Demos & Audiences, eCommerce, Marketplace Trends, News Highlights, Resources | Tagged: | Leave a Comment »

Digital signage as middle media platform

Posted by Mort Greenberg on April 6, 2008

Source: http://digitalsignagetoday.com

 

By Lyle Bunn contributor
01 Apr 2008

 

Lyle Bunn is a principal and strategy architect at Bunn Co. He is an author, presenter, consultant and visionary of the digital signage industry.
 
Social networking. Bluetooth. Mobile commerce. Millennials visiting Web sites and extending music and TV.  Each of these are components in the next wave of the digital signage business model. Digital signage has enjoyed rapid growth based on a TV-like ad display model, but the technology that drives the advantages of digital displays has positioned it for a new level of interaction and service to marketers.
 
Digital signage has been an extension of the TV and Internet ad delivery models by moving ad presentation to out-of-home and point-of-purchase. Digital signage is showing up in locations where people gather to work, learn, shop, play, commute and wait. It is also gaining the attention of marketers because it can better target specific demographics, costs less than a typical TV ad and can provide a better compliance report.
 
The number of displays is growing and delivering a viable number of exposures to merit the efforts of ad placement. Ad agencies that have lived with the “TV ad needle” pushed in their arms for years are realizing that media buying profits are based on the broken business model of broadcast. They see that their success will be regained by returning to producing messages that communicate with defined target demographics.
 
This shift includes two significant changes — better message targeting and viewer message interface.
 
Message targeting that has been based on good media buying will increasingly be based on dynamic ad provisioning. The cookies used for internet targeting, the “clicker” history of cable and cognitive recognition in digital signage all have the same objectives, and each is based on technology supporting target marketing. Message targeting is becoming a back-office technology where ads are pulled from storage and displayed based on pre-set “if-then” display rules.   
 
Message interface is the new domain of digital signage defined by interaction with the content. While physical interaction has developed through kiosks and touchscreens, the ability to scale is limited. By extending display messaging to a personal device such as a cell phone, message engagement and brand interaction is significantly advanced. This advancement makes digital signage valuable for marketers and communicators wishing to extend ad display into brand engagement.
 
Aiming for ubiquity
 
Marketers know the inherent value in using digital signage to gain heightened exposure. Their goal is ubiquity, that at each turn the media is fulfilling customers’ needs, wants and aspirations. 

SeeSaw Networks has offered a good example of this ubiquity for college students. In some situations students encounter SeeSaw digital signage on public transportation, at the coffee shop, campus locations, gas station, bank, c-store, nightclub and restaurant. The company has managed to incorporate digital signage into each daily destination.
 
Each activity is highly social, so the ads have a high probability of impacting brand awareness for students. Digital signage is part of their social networking including planned activities, destinations and discussions.
 
The Millennial group (those born after 1982) are an attractive demographic for brands. This generation is the first to exceed 100 million people in North America and 42.6 million are currently between the ages of 17-26.
 
According to StatisticsU research, 17 to 26-year-olds in this demographic spend $160.8 billion annually, not including housing payments, utilities and school costs. Ninety-six percent of college students and 86 percent of non-students in this age group use cell phones. Daniel Coates, co-founder of SurveyU, said that this group’s media consumption is shifting dramatically.
 
IDC Jupiter Research valued U.S. mobile “digital commerce” at $11.2 billion for 2007 including downloads and mobile commerce. According to Telephia, the mobile research division of Nielsen, 31 million people used mobile Internet in June 2007. Comsource forecasts mobile Internet to increase to 92 million by 2012.
 
Through interactivity digital signage serves as an excellent media platform to reach Millennials and other demographics through text code (SMS) downloads, direction to Web sites, blue-casting and permission marketing. 
 
SMS Text. Text codes presented in a digital ad could prompt the download of information, coupons or media such as ringtones, wallpaper or games. A text code could also enable a mobile commerce transaction. Mobile commerce provider mPoria reflects that the average mobile commerce transaction is $130 with conversion rates of .8-1.5 percent on mobile devices.
 
Bluetooth. Beyond text codes, the digital signage media platform can serve as the interactive media supply point for near-field communications using Bluetooth.  According to a February 2008 report by NPD Group, 69 percent of phones sold in Q2 2007 were Bluetooth-enabled, a 48 percent increase over Q3 2006. Over 40 percent of users with Bluetooth use the capability.

TruMedia’s audience measurement tool detects gender with 90 percent accuracy.
RFID technology has had limited deployment, but like barcode readers or other near-field communications, offers a viable trigger for content display customized to the viewer experience.


Facial recognition. Digital signage is ideally suited to serve ads and other content based on the audience profile of its viewers. Cognitive facial recognition can determine the gender, age range and ethnicity of a viewer. This information can then be used to trigger the display of content suited to the viewer. Using this approach, one ad may be displayed for a 50-year old white male while a different ad is presented for a 20-year-old Asian female.
 
New opportunities
 
As digital signage moves from playloop ad display to a media platform approach, a new model of ad placement and payment is made possible. Increased ad revenues are realized when audience recognition reports on actual ad viewers and ads are displayed especially for targeted audiences. Revenue is also generated by SMS text or mobile commerce interactions triggered by the digital signage content.
 
Dynamic ad provisioning from facial recognition suggests an entirely new revenue model from better message targeting. In this revenue model, content is developed for locations where targeted viewers are expected. The content is placed in storage on the media player at that location for playout when triggered (rather than simply placing the ad into a playloop).
 
The invoice for the ads is validated by a report of the viewers. CognoVision and TruMedia both offer audience recognition products for this model. This same report could fuel the creative development of the ad to maximize viewer awareness and engagement.
 
The challenge of reaching consumers and viewers has motivated the development of new technologies and business models. As digital signage continues to evolve, its strengths are exploited and inter-relationships are refined, all to the benefit of savvy communicators.

Posted in Ad Products, Ad Spending, Ad/Behaviroral Targeting, Brand Advertising, Content, Data & Metrics, Demos & Audiences, Digital Out of Home, eCommerce, Local, Marketplace Trends, Mobile, Multi-Channel, Traditional to Online | Leave a Comment »