Originally Published: August 2006
As schools open for another year and college students arrive on campus, now is the perfect time to discuss the new tactics marketers are using to target the next generation consumer. In the beginning, marketing tactics were used to deliver mass market messages such as television commercials running on one of the original three networks. This technique worked very well since a heavy majority of the population could be reached in one fell swoop. Since most people were watching one of the three networks, these marketing messages hit people “where they were” – in their living rooms. But, the marketplace is far different today than it was even 10 years ago. Mass market advertising no longer works for the vast majority of marketers. Due to the fracturing of traditional mass media vehicles such as television, magazines and newspapers, marketers are implementing more tactics in far less traditional media outlets to accomplish the same marketing goals.
The most obvious example of this change in marketing can be seen with companies that are targeting the younger generation – those in high school and college. Unlike other generations that watched one of three television networks and spent most of their free time playing outside, the current generation grew up with hundreds of television channels, high-tech video game systems, powerful computers, cell phones and the World Wide Web. Because of all these gadgets, free time is now split between hundreds of media outlets instead of just a handful. This fracturing is making it much more difficult to efficiently target individuals “where they are”. However, savvy marketers are now implementing campaigns that are integrated across many channels of new and traditional media to hit prospects where they work, study and play. One great case study for how to target young consumers is an integrated campaign that Jeep recently launched to promote its new Compass SUV.
Here are some of the elements of the campaign:
· Jeep has launched a nationwide concert series named “Uncharted: The Jeep Compass Music Tour".
· Jeep has created a MySpace page where fans can add Jeep as a "friend" to receive information on concerts in their areas.
· Jeep has also created a profile page on Facebook where concert updates are sent to friends' pages or via text message.
· Jeep is using banner ads on MySpace and Facebook to drive traffic to the Jeep profile pages.
· Jeep is one of the first advertisers of MobiTV, a self-described "cable TV network for mobile phones" that has half a million subscribers for its live TV and content subscription services.
· Jeep has launched a karaoke website and viral video contest where visitors to the site can create an avatar for themselves and choose from three songs, which can be sung into a computer microphone or over the phone via a 1-800 number. Users can then email the video to friends who can vote for the performances.
· Jeep has purchased online ads on AOL, MSN, Yahoo and entertainment, fashion and music sites like Daily Candy, MTV's Real World, Yahoo Music and Batanga.
· Jeep has also created a contest where users can create their own Jeep ad online. Once the ad is reviewed, it will be posted on the web, allowing users to vote for the best ads.
· Jeep has also purchased advertising on TV and the web (Jeep and Compass homepages, YouTube and Lat34.com), as well as print and radio.
· Jeep is also launching an outdoor advertising campaign including billboards, bus shelters, painted walls, building wraps and buzz marketing at beaches and clubs.
This is what marketing experts had in mind when they coined the term “integrated marketing” years ago. Jeep has launched a campaign that hits everywhere – online, TV, radio and print. While most marketers have yet to launch campaigns this sophisticated, the Jeep example is what it will take to target consumers in our ever-changing, ever-fracturing marketplace.
A little side note on MySpace. This social-networking site recently surpassed Yahoo! Mail and Google as the most popular U.S. website, according to Hitwise. In the week ended July 8, 2006, 4.5% of all U.S. web visits were to MySpace.com. Visitors to the site have grown 132% in the last year and 4,300% in the last two years combined.
One marketer taking advantage of the popularity of social-networking websites is Chase. Chase is running banner ads on Facebook asking members to join a Facebook-hosted group page of people who want to learn about or sign up for Chase's new "+ 1" credit card. Students can earn rewards points by getting a card, referring a friend and other actions.
Other marketers targeting the young are adding customized ads in downloadable college textbooks. The ads can be posted as long as an advertiser wishes, and they can be swapped out so advertisers can change their messaging depending upon the season. Colleges currently participating in the program include the University of Michigan, Georgia Tech, Fordham, Clemson and Carnegie Mellon. The books will be available on 150 campuses, with the potential to reach 250,000 students.
Campus Media Group is targeting college students with ads and special offers via mobile phones. To date, 3 million students have opted to receive the ads on their cell phones with messages consisting of text, images, audio or video. Students opt in through their wireless providers to receive the messages, and Campus Media Group limits the number of messages to four per month. According to the company, approximately 20% of people forward messages to a friend.
A study by Experience, Inc. reported some other statistics to consider when marketing to the younger generation:
· 98% of college students said they have made a purchase of a product or service online
· 52% said they have purchased a product or service based on an online advertisement
· 34% find online advertising the most influential means to get them to learn more about a product or service
· 41% said online advertisements would resonate if they are related to the content being read or viewed
· 34% said a contest or promotion that presents them with some value would motivate them to act on the advertisement
· 17% said they would respond to a banner ad that is based on their profile or online behavior
While the marketers in the examples I have included are using new media to target the young, I would argue that these techniques are actually showing us a glimpse of the future. Soon, you will see similar techniques used across all age groups as older generations master new technologies. Also, young consumers are aging everyday. Sooner than we think, these “new media” consumers will make up the majority of society. Just remember, according to the Entertainment Software Association the average video game player is now 33 years old and 25% of Americans over the age of 50 played video games in 2005. Integrated marketing campaigns can no longer include only TV, radio and print media. The sophisticated consumer of today must be reached via the proper mix of online, offline, new and traditional media. Gone are the days of mass marketing, and we welcome the days of niche and one-to-one marketing. Well I better run, Madden 07 just came out and I need to go online to take another beating from a 12-year old.
Tuesday, January 23, 2007
Online vs. Offline Marketing
Originally Published: July 2006
The relative effectiveness of online and offline marketing and communications presents somewhat of a dilemma these days that results in great debate about the right and wrong approaches to marketing products and services in today’s marketplace. It seems that we can’t have one type of marketing without the other. As with all new media, people are quick to toss out the old and welcome the new with little regard for overall marketing objectives, audience demographics and purchasing behaviors or preferences. However, caution must be taken when contemplating the opportunity to reduce costs with an online program. Will your online program deliver the same or better results than your current offline program? Or are you actually wasting marketing dollars rather than saving them?
Unfortunately, as with many marketing solutions, the answer to whether you should use online or offline media communications can be answered with a nondescript… “it depends”. To answer the question, you need to ask yourself: What media is available that effectively reaches my target audiences? What media do prospects and customers access in the industries/markets I want to reach? What are the ROI projections telling me? Am I looking for new business sales leads, trying to strengthen the brand or looking for the most cost-effective means to retain customers? All of these questions – and many more – will drive the answer to the online versus offline decision.
Clearly, the answer for most companies is that an integrated marcom program that includes both offline and online marketing provides the most effective means by which branding, customer retention and new business development objectives can be met.
The goal of the marketer is to reward the prospect throughout the marketing chain of awareness, interest, desire and action. How do we go about doing that and which vehicles should be chosen? The following is bulleted information that provides food for thought when evaluating online and offline marketing alternatives for your company.
· Offline tools include magazines, newspapers, television, radio, direct mail, outdoor advertising, etc.
· Online tools include websites, online advertising, banner ads, content sponsorships/links, search engine optimization, pay-per inclusion, pay-per-click, permission-based e-mail, online coupons and promotions, blogs, podcasts, webinars, rich media like streaming video, etc.
· Online programs are normally less expensive to execute – the most notable savings come from the elimination of printing and postage and a reduction in production costs
· In-house, opt-in e-mail programs deliver greater effectiveness than rented e-mail lists or direct mail programs
· Traditional offline media still has greater reach but online media has less waste – typically, trade publication advertising achieves prospect acquisition goals whereas online media has proven to be more cost-effective for retention
· Branding can be accomplished through either online or offline alternatives but an integrated program using both is most effective
· Offline media is still effective in driving traffic to the website – but once online, the visitor must find immediate gratification
· Online media offers less expensive distribution, greater personalization, higher response rates and greater tracking capabilities than offline media
· Content is important in offline media but critical in online media
· Search is more effective than banners and button advertisements by a three-to-one margin
· 85% of US business managers use search engines
· 36% of searchers assume top listings, whether sponsored or natural results, represent top brands
· Paid search will grow from $4.2 billion in 2005 to $7.5 billion in 2010, accounting for 40% of total online ad spending
· 62% of search engine users click on links returned within the first page of search hits – 90% within the first three pages
· Searches were up 55% to 5.1 billion searches in 2005 compared to 3.3 billion searches in 2004
· Remember that search engines are a passive tool awaiting activation by the user whereas online and offline advertising, e-mails, direct mail and promotions are proactive, stimulating action
· Permission-based e-mail is an interactive communication channel
· Research shows that an integrated marketing program incorporating both online and offline media is more effective than either an individual offline or online program
· Research has shown that incidental memory for ad content is significantly lower in online media compared to print media – repetition online is even more important than offline
· 98% of businesses in the US are connecting to the Internet via a high-speed line, opening the door for rich media, particularly video
· 95% of B2B marketers indicate that the largest benefit of online media is its ability to complement and enhance the use of traditional offline media
While there is not a blanket answer on what combination of online and offline media will work for your specific situation, I do highly recommend an integrated campaign that takes both types of media into account. As consumers and business decision makers increasingly go online to conduct product and company research, online media will continue to garner larger portions of the marketing budget. However, there will always be a place for offline media in nearly all marketing situations. The decision of online vs. offline vs. integration of the two comes down to your target audience. What do they read, watch, participate in, believe, feel and think? Do they want to seek out information about your company or products or do they want you to interrupt their routine with a marketing message? Let them give you these answers, or go out and ask them with market research. Today’s sophisticated consumers will tell you how and when to reach them and what they think of you and your competition. Just remember, it is okay for the truth to hurt a little.
The relative effectiveness of online and offline marketing and communications presents somewhat of a dilemma these days that results in great debate about the right and wrong approaches to marketing products and services in today’s marketplace. It seems that we can’t have one type of marketing without the other. As with all new media, people are quick to toss out the old and welcome the new with little regard for overall marketing objectives, audience demographics and purchasing behaviors or preferences. However, caution must be taken when contemplating the opportunity to reduce costs with an online program. Will your online program deliver the same or better results than your current offline program? Or are you actually wasting marketing dollars rather than saving them?
Unfortunately, as with many marketing solutions, the answer to whether you should use online or offline media communications can be answered with a nondescript… “it depends”. To answer the question, you need to ask yourself: What media is available that effectively reaches my target audiences? What media do prospects and customers access in the industries/markets I want to reach? What are the ROI projections telling me? Am I looking for new business sales leads, trying to strengthen the brand or looking for the most cost-effective means to retain customers? All of these questions – and many more – will drive the answer to the online versus offline decision.
Clearly, the answer for most companies is that an integrated marcom program that includes both offline and online marketing provides the most effective means by which branding, customer retention and new business development objectives can be met.
The goal of the marketer is to reward the prospect throughout the marketing chain of awareness, interest, desire and action. How do we go about doing that and which vehicles should be chosen? The following is bulleted information that provides food for thought when evaluating online and offline marketing alternatives for your company.
· Offline tools include magazines, newspapers, television, radio, direct mail, outdoor advertising, etc.
· Online tools include websites, online advertising, banner ads, content sponsorships/links, search engine optimization, pay-per inclusion, pay-per-click, permission-based e-mail, online coupons and promotions, blogs, podcasts, webinars, rich media like streaming video, etc.
· Online programs are normally less expensive to execute – the most notable savings come from the elimination of printing and postage and a reduction in production costs
· In-house, opt-in e-mail programs deliver greater effectiveness than rented e-mail lists or direct mail programs
· Traditional offline media still has greater reach but online media has less waste – typically, trade publication advertising achieves prospect acquisition goals whereas online media has proven to be more cost-effective for retention
· Branding can be accomplished through either online or offline alternatives but an integrated program using both is most effective
· Offline media is still effective in driving traffic to the website – but once online, the visitor must find immediate gratification
· Online media offers less expensive distribution, greater personalization, higher response rates and greater tracking capabilities than offline media
· Content is important in offline media but critical in online media
· Search is more effective than banners and button advertisements by a three-to-one margin
· 85% of US business managers use search engines
· 36% of searchers assume top listings, whether sponsored or natural results, represent top brands
· Paid search will grow from $4.2 billion in 2005 to $7.5 billion in 2010, accounting for 40% of total online ad spending
· 62% of search engine users click on links returned within the first page of search hits – 90% within the first three pages
· Searches were up 55% to 5.1 billion searches in 2005 compared to 3.3 billion searches in 2004
· Remember that search engines are a passive tool awaiting activation by the user whereas online and offline advertising, e-mails, direct mail and promotions are proactive, stimulating action
· Permission-based e-mail is an interactive communication channel
· Research shows that an integrated marketing program incorporating both online and offline media is more effective than either an individual offline or online program
· Research has shown that incidental memory for ad content is significantly lower in online media compared to print media – repetition online is even more important than offline
· 98% of businesses in the US are connecting to the Internet via a high-speed line, opening the door for rich media, particularly video
· 95% of B2B marketers indicate that the largest benefit of online media is its ability to complement and enhance the use of traditional offline media
While there is not a blanket answer on what combination of online and offline media will work for your specific situation, I do highly recommend an integrated campaign that takes both types of media into account. As consumers and business decision makers increasingly go online to conduct product and company research, online media will continue to garner larger portions of the marketing budget. However, there will always be a place for offline media in nearly all marketing situations. The decision of online vs. offline vs. integration of the two comes down to your target audience. What do they read, watch, participate in, believe, feel and think? Do they want to seek out information about your company or products or do they want you to interrupt their routine with a marketing message? Let them give you these answers, or go out and ask them with market research. Today’s sophisticated consumers will tell you how and when to reach them and what they think of you and your competition. Just remember, it is okay for the truth to hurt a little.
Search Party
Originally Published: April 2006
It seems everyone is searching for something these days – shoes on Google, sports on Yahoo!, jewelry on MSN and the list goes on and on. While I’ve discussed search engine marketing in previous columns, new data continues to prove it is a subject that is not going away anytime soon. A recent report by Nielsen/NetRatings showed that the overall search growth rate in March 2006 over 2005 was 36%. Both Google and Yahoo! exceeded that overall search growth rate with 41% and 47%, respectively, over that time period. In addition, a Harris Interactive Poll showed that 80% of Internet traffic begins at a search engine and according to DoubleClick, 41% of Web users find companies through search rather than typing a URL directly into a browser. While these numbers reinforce the fact that search marketing remains a hot topic, there are some additional new technologies that are fueling this growth by allowing advertisers to target via user behaviors, day parting, geographic parameters and demographic parameters.
ValueClick Media’s User Retargeting program is one example of behavioral targeting. It works by checking to see if a user has visited one of ValueClick Media’s advertiser sites. If a user has visited any of the 13,500 advertiser sites within the ValueClick Media network, that user is then retargeted with highly customized ads based on what site the user visited previously. According to ValueClick Media, in preliminary campaigns that were compared to run of network campaigns, User Retargeting resulted in up to a 26% improvement in the average cost-per-visitor, a 59% improvement in the average cost-per-sale and an overall conversion rate increase of 1,800%. In addition, these user retargeted campaigns generated a 223% increase in the average order value. This demonstrated success is good news for ValueClick Media considering eMarketer research indicates that behavioral ad spending will reach $1.2 billion in 2006, up from $925 million last year. And, they believe it will reach $2.1 billion by 2008.
Another more recent search marketing tool is day parting. Like television advertising, online day parting allows an advertiser to target specific times of the day with ads. Kanoodle, a distributor of sponsored links, is one online company that allows advertisers to day part. The company has also added a tool that allows an advertiser to target ads geographically via a user’s IP address. This addition completes the company’s LocalTarget product, which uses topics or subjects to identify content targeted at specific markets. By combining these tools, marketers can very precisely target the audience by day part, contextually and geographically, making the advertising more effective and improving return on investment.
Demographic-based search marketing is one of the newest online advertising techniques. MSN adCenter recently joined the demographically-targeted search game. adCenter will use the data it has collected through Passport, MSN’s registration program for other Microsoft services such as Hotmail and MSN Messenger, to target searchers. Demographic targeting may end up being the most important method of search marketing, but because it is so new, it has yet to be made clear on whether an ideal targeting system can be found. While MSN has collected information on thousands of users with its Passport system, the system is still limited to only those that have registered their information. Google and Yahoo! also have versions of demographic targeting, but both only apply to their content networks. So, there is still no perfect system in place. In addition, most likely there will be at least some market backlash from privacy concerns that may hinder the growth of demographic-based targeted search.
With all these new technologies hitting the marketplace, it is important to remember that no one advertising outlet will be enough to accomplish all of your marketing goals. With so many media outlets, both online and off, effective integration of your marketing campaign is critical. Your campaign should have the same look, the same feel and most importantly the same message regardless of the media used to reach prospects. It is also important to remember that according to a SIMM study 66.2% of consumers regularly use TV and the Internet simultaneously. So, if you have an offline campaign for a new product (let’s say a TV commercial), you must tie your online marketing efforts to it. For example, Pontiac is running a television commercial that asks you to “Google” Pontiac to “see for yourself”. If you do indeed “Google” Pontiac, you will see that Pontiac has the first sponsored link and in the second position is a targeted ad for Pontiac dealers. This is a great example of integrating online and offline campaigns.
While I have included just a few examples of the many new technologies in search marketing, it is important to remember that these new technologies are helping to drive search marketing spending and in turn overall online ad spending. Staying on top of all the new search marketing developments is a challenge, but the payoff is worth it. If done correctly, targeted search marketing will decrease your cost-per-visitor, cost-per-sale and most importantly overall return on investment. Isn’t it time you sent out your own search party? Now get out there and hunt for more website visitors.
It seems everyone is searching for something these days – shoes on Google, sports on Yahoo!, jewelry on MSN and the list goes on and on. While I’ve discussed search engine marketing in previous columns, new data continues to prove it is a subject that is not going away anytime soon. A recent report by Nielsen/NetRatings showed that the overall search growth rate in March 2006 over 2005 was 36%. Both Google and Yahoo! exceeded that overall search growth rate with 41% and 47%, respectively, over that time period. In addition, a Harris Interactive Poll showed that 80% of Internet traffic begins at a search engine and according to DoubleClick, 41% of Web users find companies through search rather than typing a URL directly into a browser. While these numbers reinforce the fact that search marketing remains a hot topic, there are some additional new technologies that are fueling this growth by allowing advertisers to target via user behaviors, day parting, geographic parameters and demographic parameters.
ValueClick Media’s User Retargeting program is one example of behavioral targeting. It works by checking to see if a user has visited one of ValueClick Media’s advertiser sites. If a user has visited any of the 13,500 advertiser sites within the ValueClick Media network, that user is then retargeted with highly customized ads based on what site the user visited previously. According to ValueClick Media, in preliminary campaigns that were compared to run of network campaigns, User Retargeting resulted in up to a 26% improvement in the average cost-per-visitor, a 59% improvement in the average cost-per-sale and an overall conversion rate increase of 1,800%. In addition, these user retargeted campaigns generated a 223% increase in the average order value. This demonstrated success is good news for ValueClick Media considering eMarketer research indicates that behavioral ad spending will reach $1.2 billion in 2006, up from $925 million last year. And, they believe it will reach $2.1 billion by 2008.
Another more recent search marketing tool is day parting. Like television advertising, online day parting allows an advertiser to target specific times of the day with ads. Kanoodle, a distributor of sponsored links, is one online company that allows advertisers to day part. The company has also added a tool that allows an advertiser to target ads geographically via a user’s IP address. This addition completes the company’s LocalTarget product, which uses topics or subjects to identify content targeted at specific markets. By combining these tools, marketers can very precisely target the audience by day part, contextually and geographically, making the advertising more effective and improving return on investment.
Demographic-based search marketing is one of the newest online advertising techniques. MSN adCenter recently joined the demographically-targeted search game. adCenter will use the data it has collected through Passport, MSN’s registration program for other Microsoft services such as Hotmail and MSN Messenger, to target searchers. Demographic targeting may end up being the most important method of search marketing, but because it is so new, it has yet to be made clear on whether an ideal targeting system can be found. While MSN has collected information on thousands of users with its Passport system, the system is still limited to only those that have registered their information. Google and Yahoo! also have versions of demographic targeting, but both only apply to their content networks. So, there is still no perfect system in place. In addition, most likely there will be at least some market backlash from privacy concerns that may hinder the growth of demographic-based targeted search.
With all these new technologies hitting the marketplace, it is important to remember that no one advertising outlet will be enough to accomplish all of your marketing goals. With so many media outlets, both online and off, effective integration of your marketing campaign is critical. Your campaign should have the same look, the same feel and most importantly the same message regardless of the media used to reach prospects. It is also important to remember that according to a SIMM study 66.2% of consumers regularly use TV and the Internet simultaneously. So, if you have an offline campaign for a new product (let’s say a TV commercial), you must tie your online marketing efforts to it. For example, Pontiac is running a television commercial that asks you to “Google” Pontiac to “see for yourself”. If you do indeed “Google” Pontiac, you will see that Pontiac has the first sponsored link and in the second position is a targeted ad for Pontiac dealers. This is a great example of integrating online and offline campaigns.
While I have included just a few examples of the many new technologies in search marketing, it is important to remember that these new technologies are helping to drive search marketing spending and in turn overall online ad spending. Staying on top of all the new search marketing developments is a challenge, but the payoff is worth it. If done correctly, targeted search marketing will decrease your cost-per-visitor, cost-per-sale and most importantly overall return on investment. Isn’t it time you sent out your own search party? Now get out there and hunt for more website visitors.
Convergence is a Reality
Originally Published: March 2006
The convergence of television, radio, movies and the Internet appears to finally be upon us. In the early days of the Internet, one of its greatest promises was of bringing all forms of digital entertainment together and delivering it right into our living room or office in one shiny package. Over a decade later, that promise is becoming reality.
Up until now, the lack of widespread broadband Internet access and the lack of PCs powerful enough to power all forms of entertainment hindered the convergence of television, radio, movies and the Internet. Consumers did not have the ability to reliably and quickly receive streaming audio and video. With long load times and poor quality, even audio and short video clips were too much for dialup. But as broadband has exploded in growth, and the PC has grown into a powerhouse, so has the opportunity to converge.
Along with improved technology, consumers are showing an increasing desire for individualized entertainment experiences. More and more Americans want entertainment on their terms… when and where they want. Digital video recorders, mobile phones with audio and video capability, inexpensive digital still and digital video cameras, PDAs, handheld video game consoles that play movies and digital music, satellite radio and iPods (with video and audio capability) and other digital audio players have made it easy for consumers to access their favorite TV shows, movies and music anywhere and everywhere they want. Personal choice is driving consumption. With these new technologies, people are creating and publishing personal videos, composing and broadcasting original music and creating personal online outlets with services such as MySpace.
The popularity of devices that allow consumers to access content when and where they want is most obvious in Apple’s iPod. As reported by Marketing News, Apple sold 42 million iPods in 2005 with 14 million sold in the quarter ending December 31, 2005. The launch of the video iPod only increased the public’s desire for the product. iTunes sold one million video downloads in the first 20 days of the video iPod’s launch in October 2005 and eight million video downloads were sold through mid-January 2006. iTunes now has approximately 83% U.S. market share of legal music downloads and according to NPD Group/NPD Techworld, Apple holds a 73.9% market share of all digital music manufacturers.
The popularity of devices such as the iPod, digital video recorders and satellite radio is increasing the speed at which traditional media outlets are fragmenting. This fragmentation continues to affect major networks and broadcasters as the captive audience they once had continues to diminish and consumers increasingly feed their entertainment desires on their terms. These major networks and broadcasters used to control distribution of radio and television, but that is no longer the case.
True convergence will only exacerbate this trend. As the home PC becomes the hub of home entertainment, consumers will have access to literally thousands of radio stations, television channels, movies and web-based entertainment at the click of a button. Companies like Dell and Sony are already producing computers that serve as the entertainment hub of the home. Sitting in your living room lounge chair, you can now watch one NCAA tournament game in high definition from the local CBS affiliate, click over to watch your alma mater play in a different tournament game on sportsline.com, surf over to eBay and buy the first Sweet 16 t-shirt that your school has produced in fifteen years, click over to ESPN to check how your five brackets are doing in their $10,000 bracket contest, switch over to MySpace to see if any of your “friends” are at the game, then you can Instant Message your dad to discuss the goaltending call the referees just missed, and when your team finally wins the game, you can go to Wikipedia to research just how good the Connecticut Huskies are since you’re looking past George Mason, as that is obviously a “gimmee” game. To some this sounds like the promise of what the future might bring, but in reality, the dream of convergence (with the Internet and your home PC as the entertainment hub) has finally arrived.
While convergence will continue to give the traditional media conglomerates (including television, radio, newspapers, magazines, etc.) problems with ratings and maintaining advertising revenues, it is great for the consumer who wants entertainment on-demand. Media organizations will have to come up with effective ways to sort out their audiences and allow marketers the opportunity to effectively target specific audiences. And the consumer will only have to sit back, relax and enjoy the converged experience. Isn’t it time you put your feet up and let the entertainment come to you?
The convergence of television, radio, movies and the Internet appears to finally be upon us. In the early days of the Internet, one of its greatest promises was of bringing all forms of digital entertainment together and delivering it right into our living room or office in one shiny package. Over a decade later, that promise is becoming reality.
Up until now, the lack of widespread broadband Internet access and the lack of PCs powerful enough to power all forms of entertainment hindered the convergence of television, radio, movies and the Internet. Consumers did not have the ability to reliably and quickly receive streaming audio and video. With long load times and poor quality, even audio and short video clips were too much for dialup. But as broadband has exploded in growth, and the PC has grown into a powerhouse, so has the opportunity to converge.
Along with improved technology, consumers are showing an increasing desire for individualized entertainment experiences. More and more Americans want entertainment on their terms… when and where they want. Digital video recorders, mobile phones with audio and video capability, inexpensive digital still and digital video cameras, PDAs, handheld video game consoles that play movies and digital music, satellite radio and iPods (with video and audio capability) and other digital audio players have made it easy for consumers to access their favorite TV shows, movies and music anywhere and everywhere they want. Personal choice is driving consumption. With these new technologies, people are creating and publishing personal videos, composing and broadcasting original music and creating personal online outlets with services such as MySpace.
The popularity of devices that allow consumers to access content when and where they want is most obvious in Apple’s iPod. As reported by Marketing News, Apple sold 42 million iPods in 2005 with 14 million sold in the quarter ending December 31, 2005. The launch of the video iPod only increased the public’s desire for the product. iTunes sold one million video downloads in the first 20 days of the video iPod’s launch in October 2005 and eight million video downloads were sold through mid-January 2006. iTunes now has approximately 83% U.S. market share of legal music downloads and according to NPD Group/NPD Techworld, Apple holds a 73.9% market share of all digital music manufacturers.
The popularity of devices such as the iPod, digital video recorders and satellite radio is increasing the speed at which traditional media outlets are fragmenting. This fragmentation continues to affect major networks and broadcasters as the captive audience they once had continues to diminish and consumers increasingly feed their entertainment desires on their terms. These major networks and broadcasters used to control distribution of radio and television, but that is no longer the case.
True convergence will only exacerbate this trend. As the home PC becomes the hub of home entertainment, consumers will have access to literally thousands of radio stations, television channels, movies and web-based entertainment at the click of a button. Companies like Dell and Sony are already producing computers that serve as the entertainment hub of the home. Sitting in your living room lounge chair, you can now watch one NCAA tournament game in high definition from the local CBS affiliate, click over to watch your alma mater play in a different tournament game on sportsline.com, surf over to eBay and buy the first Sweet 16 t-shirt that your school has produced in fifteen years, click over to ESPN to check how your five brackets are doing in their $10,000 bracket contest, switch over to MySpace to see if any of your “friends” are at the game, then you can Instant Message your dad to discuss the goaltending call the referees just missed, and when your team finally wins the game, you can go to Wikipedia to research just how good the Connecticut Huskies are since you’re looking past George Mason, as that is obviously a “gimmee” game. To some this sounds like the promise of what the future might bring, but in reality, the dream of convergence (with the Internet and your home PC as the entertainment hub) has finally arrived.
While convergence will continue to give the traditional media conglomerates (including television, radio, newspapers, magazines, etc.) problems with ratings and maintaining advertising revenues, it is great for the consumer who wants entertainment on-demand. Media organizations will have to come up with effective ways to sort out their audiences and allow marketers the opportunity to effectively target specific audiences. And the consumer will only have to sit back, relax and enjoy the converged experience. Isn’t it time you put your feet up and let the entertainment come to you?
Wednesday, January 17, 2007
Viral Marketing
Originally Published: February 2006
Viruses are feared both in the online and offline worlds. They latch on (many times unknowingly), take hold and spread extremely quickly. Viruses can inflict serious damage and there is little that can be done until symptoms arise, which is usually when the damage has already been done. However, this exact concept has been harnessed by savvy online marketers for effective, low-cost brand promotion. Dubbed viral marketing, the concept of one person spreading a message to a few others who turn around and spread it to a few others who turn around and send it on and on and on until millions of people have viewed the message continues to be an effective online marketing tool. From the time Hotmail pioneered the concept until now, marketers have used this ultimate form of online word-of-mouth marketing to quickly promote brand growth.
Around 1996, Hotmail decided to try a novel concept (at the time) – free Internet-based e-mail. To promote the service, the company attached a line at the bottom of users’ e-mail encouraging the mail recipient to check out and pass on the Hotmail service. In its first year and a half, Hotmail signed up over 12 million users. The most interesting aspect is that from the start of the service with zero users until the time they hit 12 million users, Hotmail spent less than $500,000 on marketing, advertising and promotion. This is an amazingly low number considering $500,000 would have bought the company about 6 seconds of a Super Bowl ad this year.
As the Hotmail example shows, viral marketing is popular because it is relatively easy to execute, offers lower costs than other forms of online marketing, has a built-in targeting mechanism (people who are interested in the offer, product or entertainment value of the message pass it on to others that they know would be interested as well) and high, rapid response rates if the campaign is executed correctly.
The important things to note when implementing a viral marketing campaign are:
· Use a message that entertains or promotes the giving away of valued products or services
· Make it as easy as possible for a recipient to pass it on
· Create a “cool” message and allow it to take on a life of its own
Entertainment can come in the form of interesting or funny commercials, fun games or attention-getting audio. One recent example of the power of entertaining viral email was the video of a house with a spectacular Christmas light show that was set to music by the Trans-Siberian Orchestra. The video shot just south of Dayton in Loveland, Ohio, surfaced around Thanksgiving and spread so quickly and drew so much attention that it became a national beer commercial before Christmas. The man who set up the display actually had to shut it down because it snarled traffic in his neighborhood.
Games are another entertaining form of viral campaigns. As I’ve stated in other columns, advergames are extremely effective at providing entertainment for gamers while pushing a brand at the same time. Many companies offer the option of sending game web links to family and friends at the click of a button. Giveaways and contests are another great way to spread a brand message. If someone spots a valuable giveaway or contest, they usually want to involve their family and friends. People have a natural tendency to want to help or impress their family and friends, so informing others about giveaways, contests, or just a fun game or entertaining video makes people feel good. They want to spread the word, not only to help their friends but also to gain a sense of being on the cutting edge – “Look at the cool thing I found.” So, the sender feels good about it, while the company that originated the message receives the benefit of more eyes on the branded message.
Once an interesting message has been crafted, marketers must make it extremely easy for a person to pass it on to others. Send to a friend buttons are the most popular and easiest way to do this. Also, making it easy to pass along an attachment or encouraging people to forward a web link are other great ways to make it easy for the message to spread quickly.
There tends to be a thin line between the success and failure of a viral marketing campaign. That success depends heavily on the coolness factor. People want to show off interesting, funny, new, cool things. The most successful viral campaigns also tend to be the ones least controlled by the company sending the original message. Generally speaking, the more a viral marketing campaign is planned and controlled, the less likely it will succeed, while the less a campaign is controlled and allowed to spread out and do its own thing, the more likely it will be to build a strong following. It is very similar to the street credibility of a rapper. If someone raps about the tribulations in his life, when he actually went to prep school in New England, that rapper has no credibility and will likely flop in the music industry. The same can be said with viral marketing. The company or brand should release a great message that the target group would be interested in, make it easy to pass on the message and then let it run its course.
While people tend to have negative views of traditional commercial messages, viral marketing has become somewhat of a pastime for Americans. A study by Sharpe Partners found that 89% of U.S. adult Internet users share content with friends, family and associates by e-mail, 63% share content at least once per week and 25% share daily or almost daily. This content includes jokes, news stories, short movies, web links and other marketing messages. Sharpe Partners learned that adding overt brand messages only slightly reduces the likelihood that content will be shared with others. Only 5% of respondents said they refuse to share content that contains a clear brand message and 89% of those who receive e-mails with brand sponsorships had no adverse feelings toward the brand or message.
Viral marketing also allows you to promote your brand message to a targeted group far beyond the original audience. People pass the message on to others who they know would be interested, thus your message can hit portions of your target market that you could never hope to reach on your own. Because individuals become the medium (rather than traditional direct mail pieces, launching a nationwide television ad campaign, etc.), the cost stays low and return on investment can be very high. Viral marketing is a true form of online word-of-mouth. This is one virus that I would highly recommend getting.
Viruses are feared both in the online and offline worlds. They latch on (many times unknowingly), take hold and spread extremely quickly. Viruses can inflict serious damage and there is little that can be done until symptoms arise, which is usually when the damage has already been done. However, this exact concept has been harnessed by savvy online marketers for effective, low-cost brand promotion. Dubbed viral marketing, the concept of one person spreading a message to a few others who turn around and spread it to a few others who turn around and send it on and on and on until millions of people have viewed the message continues to be an effective online marketing tool. From the time Hotmail pioneered the concept until now, marketers have used this ultimate form of online word-of-mouth marketing to quickly promote brand growth.
Around 1996, Hotmail decided to try a novel concept (at the time) – free Internet-based e-mail. To promote the service, the company attached a line at the bottom of users’ e-mail encouraging the mail recipient to check out and pass on the Hotmail service. In its first year and a half, Hotmail signed up over 12 million users. The most interesting aspect is that from the start of the service with zero users until the time they hit 12 million users, Hotmail spent less than $500,000 on marketing, advertising and promotion. This is an amazingly low number considering $500,000 would have bought the company about 6 seconds of a Super Bowl ad this year.
As the Hotmail example shows, viral marketing is popular because it is relatively easy to execute, offers lower costs than other forms of online marketing, has a built-in targeting mechanism (people who are interested in the offer, product or entertainment value of the message pass it on to others that they know would be interested as well) and high, rapid response rates if the campaign is executed correctly.
The important things to note when implementing a viral marketing campaign are:
· Use a message that entertains or promotes the giving away of valued products or services
· Make it as easy as possible for a recipient to pass it on
· Create a “cool” message and allow it to take on a life of its own
Entertainment can come in the form of interesting or funny commercials, fun games or attention-getting audio. One recent example of the power of entertaining viral email was the video of a house with a spectacular Christmas light show that was set to music by the Trans-Siberian Orchestra. The video shot just south of Dayton in Loveland, Ohio, surfaced around Thanksgiving and spread so quickly and drew so much attention that it became a national beer commercial before Christmas. The man who set up the display actually had to shut it down because it snarled traffic in his neighborhood.
Games are another entertaining form of viral campaigns. As I’ve stated in other columns, advergames are extremely effective at providing entertainment for gamers while pushing a brand at the same time. Many companies offer the option of sending game web links to family and friends at the click of a button. Giveaways and contests are another great way to spread a brand message. If someone spots a valuable giveaway or contest, they usually want to involve their family and friends. People have a natural tendency to want to help or impress their family and friends, so informing others about giveaways, contests, or just a fun game or entertaining video makes people feel good. They want to spread the word, not only to help their friends but also to gain a sense of being on the cutting edge – “Look at the cool thing I found.” So, the sender feels good about it, while the company that originated the message receives the benefit of more eyes on the branded message.
Once an interesting message has been crafted, marketers must make it extremely easy for a person to pass it on to others. Send to a friend buttons are the most popular and easiest way to do this. Also, making it easy to pass along an attachment or encouraging people to forward a web link are other great ways to make it easy for the message to spread quickly.
There tends to be a thin line between the success and failure of a viral marketing campaign. That success depends heavily on the coolness factor. People want to show off interesting, funny, new, cool things. The most successful viral campaigns also tend to be the ones least controlled by the company sending the original message. Generally speaking, the more a viral marketing campaign is planned and controlled, the less likely it will succeed, while the less a campaign is controlled and allowed to spread out and do its own thing, the more likely it will be to build a strong following. It is very similar to the street credibility of a rapper. If someone raps about the tribulations in his life, when he actually went to prep school in New England, that rapper has no credibility and will likely flop in the music industry. The same can be said with viral marketing. The company or brand should release a great message that the target group would be interested in, make it easy to pass on the message and then let it run its course.
While people tend to have negative views of traditional commercial messages, viral marketing has become somewhat of a pastime for Americans. A study by Sharpe Partners found that 89% of U.S. adult Internet users share content with friends, family and associates by e-mail, 63% share content at least once per week and 25% share daily or almost daily. This content includes jokes, news stories, short movies, web links and other marketing messages. Sharpe Partners learned that adding overt brand messages only slightly reduces the likelihood that content will be shared with others. Only 5% of respondents said they refuse to share content that contains a clear brand message and 89% of those who receive e-mails with brand sponsorships had no adverse feelings toward the brand or message.
Viral marketing also allows you to promote your brand message to a targeted group far beyond the original audience. People pass the message on to others who they know would be interested, thus your message can hit portions of your target market that you could never hope to reach on your own. Because individuals become the medium (rather than traditional direct mail pieces, launching a nationwide television ad campaign, etc.), the cost stays low and return on investment can be very high. Viral marketing is a true form of online word-of-mouth. This is one virus that I would highly recommend getting.
Online Copyright Law
Originally Published: January 2006
As the Internet grows larger by the minute, people have access to more and more information. You can now access libraries of information with the click of a button whereas in the past it took a trip to the local library and hours of perusing through volumes of texts. But as the Internet allows you to gather information in minutes, so does it allow you to copy photos, video, audio, text and other content just as easily. But just because it’s easy doesn’t mean it’s legal. In fact, copyright laws apply the same standards to the Internet and the World Wide Web as they do to offline original works. While I’m not a copyright attorney (and please check with one if you feel you may be in violation of a copyright), here are the general basic facts of online copyright law.
According to the Copyright Act of 1976, all original works are considered under copyright protection when they are put in tangible form (written, recorded, etc.). Protected works include literary, dramatic and musical works, pictorial, graphic and sculptural works, audio-visual works, sound recordings and architectural works. As of 1989, you don’t need to give notice of a copyright. Once a work is put in tangible form, copyright is implied even without notice. This means that although there may not be a copyright visible on a website, all the original content is still protected by copyright. This is always the case unless the owner of the copyright explicitly says that the work is in the public domain. If content is not indicated for the public domain, the person who holds the copyright holds exclusive rights to the content. The only limitation is the “fair use” portion of the Copyright Act.
Fair use allows a person to use a copyrighted work for criticism, comment, research and education only, but even then you can only use small portions of the work. Just as you used a quotation in a research paper in high school or college; you must give the author (regardless of what form the creative expression takes) credit for the work. If you are using the content to promote a website, a business, a cause or any sort of commerce, fair use definitely does not apply. For items published on the Web, the Copyright Act of 1976 applies. Individual Web pages, including text, graphics, visual images, music, video, news stories, electronic bulletin board messages, databases, CD-ROMs and even e-mail are copyrighted materials. If you decide to use content from a Web page or email, first you must follow the rules of fair use then you must credit the owner of the copyright. If the owner has published explicit guidelines regarding the use of his/her content, you should follow them. Even if you use content in fair use, whenever possible you should ask the owner of the copyright for permission to use the content. And, it’s always a good idea to keep a copy of your request for permission and the permission received. If you use the content for any sort of promotion, and especially if you stand to gain financially, you must get permission prior to using any content.
The following is a sample copyright statement that is fairly standard for a website:
You may browse this site for information. You acknowledge, however, that this site contains information, data, photographs, graphics and other materials that are protected by laws governing copyrights, trademarks, trade secrets, and other proprietary rights. Under no circumstances may you transfer (including, without limitation, by sale, loan, rent or lease), use, copy, reproduce, download, republish, upload, post, transmit, adapt, modify or distribute the site contents, in whole or in part, without the express prior written consent of ACME Company. The use of any of the site contents on any other website or networked computer environment is prohibited. This site is intended and directed only to residents of the United States and all advertising and claims in this site are valid only in the United States.
I recently discovered an interesting online tool to help fight against online content (text) infringement – www.copyscape.com. The Copyscape website will give you a listing of what sites have quoted your website, as well as those that have copied your content without permission. Once you visit Copyscape, all you have to do is input the website you want to search for and within seconds, you have a list of all the sites that are using your text. This is a quick and easy way to get a snapshot of who might be using your website content legally and illegally.
Online copyright law comes down to this: if you plan to use any content from the Web, including text, video, audio, photos, etc., you should assume it is copyrighted unless otherwise noted. When in doubt, ask permission prior to using the content even if you feel your use falls under the fair use guidelines. It is better to be safe than ending up in a courtroom. And yes, you can quote this article… as long as it is for educational purposes and credit is given of course.
As the Internet grows larger by the minute, people have access to more and more information. You can now access libraries of information with the click of a button whereas in the past it took a trip to the local library and hours of perusing through volumes of texts. But as the Internet allows you to gather information in minutes, so does it allow you to copy photos, video, audio, text and other content just as easily. But just because it’s easy doesn’t mean it’s legal. In fact, copyright laws apply the same standards to the Internet and the World Wide Web as they do to offline original works. While I’m not a copyright attorney (and please check with one if you feel you may be in violation of a copyright), here are the general basic facts of online copyright law.
According to the Copyright Act of 1976, all original works are considered under copyright protection when they are put in tangible form (written, recorded, etc.). Protected works include literary, dramatic and musical works, pictorial, graphic and sculptural works, audio-visual works, sound recordings and architectural works. As of 1989, you don’t need to give notice of a copyright. Once a work is put in tangible form, copyright is implied even without notice. This means that although there may not be a copyright visible on a website, all the original content is still protected by copyright. This is always the case unless the owner of the copyright explicitly says that the work is in the public domain. If content is not indicated for the public domain, the person who holds the copyright holds exclusive rights to the content. The only limitation is the “fair use” portion of the Copyright Act.
Fair use allows a person to use a copyrighted work for criticism, comment, research and education only, but even then you can only use small portions of the work. Just as you used a quotation in a research paper in high school or college; you must give the author (regardless of what form the creative expression takes) credit for the work. If you are using the content to promote a website, a business, a cause or any sort of commerce, fair use definitely does not apply. For items published on the Web, the Copyright Act of 1976 applies. Individual Web pages, including text, graphics, visual images, music, video, news stories, electronic bulletin board messages, databases, CD-ROMs and even e-mail are copyrighted materials. If you decide to use content from a Web page or email, first you must follow the rules of fair use then you must credit the owner of the copyright. If the owner has published explicit guidelines regarding the use of his/her content, you should follow them. Even if you use content in fair use, whenever possible you should ask the owner of the copyright for permission to use the content. And, it’s always a good idea to keep a copy of your request for permission and the permission received. If you use the content for any sort of promotion, and especially if you stand to gain financially, you must get permission prior to using any content.
The following is a sample copyright statement that is fairly standard for a website:
You may browse this site for information. You acknowledge, however, that this site contains information, data, photographs, graphics and other materials that are protected by laws governing copyrights, trademarks, trade secrets, and other proprietary rights. Under no circumstances may you transfer (including, without limitation, by sale, loan, rent or lease), use, copy, reproduce, download, republish, upload, post, transmit, adapt, modify or distribute the site contents, in whole or in part, without the express prior written consent of ACME Company. The use of any of the site contents on any other website or networked computer environment is prohibited. This site is intended and directed only to residents of the United States and all advertising and claims in this site are valid only in the United States.
I recently discovered an interesting online tool to help fight against online content (text) infringement – www.copyscape.com. The Copyscape website will give you a listing of what sites have quoted your website, as well as those that have copied your content without permission. Once you visit Copyscape, all you have to do is input the website you want to search for and within seconds, you have a list of all the sites that are using your text. This is a quick and easy way to get a snapshot of who might be using your website content legally and illegally.
Online copyright law comes down to this: if you plan to use any content from the Web, including text, video, audio, photos, etc., you should assume it is copyrighted unless otherwise noted. When in doubt, ask permission prior to using the content even if you feel your use falls under the fair use guidelines. It is better to be safe than ending up in a courtroom. And yes, you can quote this article… as long as it is for educational purposes and credit is given of course.
Search Remains Hot While Video Warms Up
Originally Published: December 2005
With the cold weather outside, it’s good to turn our minds to the warm things we miss… beaches, convertible cars and search marketing. Okay, so you cannot really compare search marketing to a white sand beach, but they do have one thing in common… they are both hot. Search marketing continues to garner a larger portion of online ad budgets, and it does not show signs of slowing down anytime soon. Internet video advertising is also trying to make a name for itself and carve out a larger portion of those online ad budgets. With the growth of broadband, video ads have been springing up for some time. However, it now appears they are on the cusp of true explosive growth.
With online marketing budgets making up 56% of the total marketing budget of business-to-consumer marketers and making up 40% of the total marketing budget of business-to-business marketers, as reported by MarketingSherpa, the piece of the pie going to online marketing is getting much larger. In addition, a recent joint study by Deutsche Bank and Media Post revealed that third quarter 2005 online ad-spending rose 10% over the second quarter. 73.5% of respondents said their budgets increased and more than one third said their budgets increased by at least 11% over the previous quarter.
According to the Pew Internet & American Life Project, approximately 60 million people use search engines each day. That number equates to 41% of the Internet-using population that current use search engines on a typical day. The Project also revealed the total number of people using search engines has increased 55% from June 2004 to September 2005 from 38 million to 59 million. With nearly 60 million people using search engines each day, paid search has become a huge business. Currently, comScore Media Matrix ranks Google, Yahoo!, MSN, Ask Jeeves and AOL as the top five search engines based on the number of unique visitors.
When you combine the increase in online budgets with the continuing increase in search engine usage, you can see why paid search advertising exploded in growth in 2005. Online video ad spending is also on the rise, and 2006 should see it truly hit the ground running.
A recent study by eMarketer found Internet video ad spending will nearly triple in 2007 to $640 million from $225 million in 2005, and they predict video spending will reach $1.5 billion in 2009. This tremendous growth has been spurred by the proliferation of broadband access in homes. The year 2005 marked the first time over half of all online households connected to the Internet via high-speed access. eMarketer predicts that by early 2008 more than half of all households, not just those currently connected to the Internet, will connect via broadband. With this extended reach and the ability to use true video, marketers can use the Internet like a targeted version of TV. Marketers can pick and choose who they want to see the advertising, and the creative can have all the elements of TV (audio and video). In addition, true online video will allow marketers to blend entertainment, paid search, behavioral targeting, online brand building and online gaming into a true integrated online brand building and sales-driving campaign.
However, there are a couple downsides to paid search and video advertising, namely rising costs and increased competition. In the study by Deutsche Bank and Media Post, they found prices of search ads continue to increase at a significant rate. 58.2% of respondents reported paying more for search ads in the third quarter of 2005 than they paid in the second. In addition, two thirds of respondents said they paid more for rich media in the third quarter over the previous quarter. This rise in cost can be attributed to the fact that paid search can be easily tracked (to quickly show return on investment), it has demonstrated its effectiveness and since many advertisers have jumped into the paid search game, competition is becoming stiff for limited inventory. Click fraud is also a concern for paid search marketers, although many of the search engines have systems in place to monitor and lessen the likelihood of fraud. Similar things are happening with video advertising. As more and more marketers realize the effectiveness of the medium, and can prove it by fairly simple metrics, it is bringing about increased competition for limited space. While competition is not as fierce as it is with paid search, it is catching up quickly.
As the year 2006 begins, paid search and online video advertising are two hot items during this cold weather season. While both have their drawbacks, they are proving their effectiveness on a daily basis. As more and more marketers are shifting budgets to online (and have been for quite some time now), it is freeing up more dollars for paid search and leading edge technologies like video advertising. Now, who isn’t ready for a heat wave?
With the cold weather outside, it’s good to turn our minds to the warm things we miss… beaches, convertible cars and search marketing. Okay, so you cannot really compare search marketing to a white sand beach, but they do have one thing in common… they are both hot. Search marketing continues to garner a larger portion of online ad budgets, and it does not show signs of slowing down anytime soon. Internet video advertising is also trying to make a name for itself and carve out a larger portion of those online ad budgets. With the growth of broadband, video ads have been springing up for some time. However, it now appears they are on the cusp of true explosive growth.
With online marketing budgets making up 56% of the total marketing budget of business-to-consumer marketers and making up 40% of the total marketing budget of business-to-business marketers, as reported by MarketingSherpa, the piece of the pie going to online marketing is getting much larger. In addition, a recent joint study by Deutsche Bank and Media Post revealed that third quarter 2005 online ad-spending rose 10% over the second quarter. 73.5% of respondents said their budgets increased and more than one third said their budgets increased by at least 11% over the previous quarter.
According to the Pew Internet & American Life Project, approximately 60 million people use search engines each day. That number equates to 41% of the Internet-using population that current use search engines on a typical day. The Project also revealed the total number of people using search engines has increased 55% from June 2004 to September 2005 from 38 million to 59 million. With nearly 60 million people using search engines each day, paid search has become a huge business. Currently, comScore Media Matrix ranks Google, Yahoo!, MSN, Ask Jeeves and AOL as the top five search engines based on the number of unique visitors.
When you combine the increase in online budgets with the continuing increase in search engine usage, you can see why paid search advertising exploded in growth in 2005. Online video ad spending is also on the rise, and 2006 should see it truly hit the ground running.
A recent study by eMarketer found Internet video ad spending will nearly triple in 2007 to $640 million from $225 million in 2005, and they predict video spending will reach $1.5 billion in 2009. This tremendous growth has been spurred by the proliferation of broadband access in homes. The year 2005 marked the first time over half of all online households connected to the Internet via high-speed access. eMarketer predicts that by early 2008 more than half of all households, not just those currently connected to the Internet, will connect via broadband. With this extended reach and the ability to use true video, marketers can use the Internet like a targeted version of TV. Marketers can pick and choose who they want to see the advertising, and the creative can have all the elements of TV (audio and video). In addition, true online video will allow marketers to blend entertainment, paid search, behavioral targeting, online brand building and online gaming into a true integrated online brand building and sales-driving campaign.
However, there are a couple downsides to paid search and video advertising, namely rising costs and increased competition. In the study by Deutsche Bank and Media Post, they found prices of search ads continue to increase at a significant rate. 58.2% of respondents reported paying more for search ads in the third quarter of 2005 than they paid in the second. In addition, two thirds of respondents said they paid more for rich media in the third quarter over the previous quarter. This rise in cost can be attributed to the fact that paid search can be easily tracked (to quickly show return on investment), it has demonstrated its effectiveness and since many advertisers have jumped into the paid search game, competition is becoming stiff for limited inventory. Click fraud is also a concern for paid search marketers, although many of the search engines have systems in place to monitor and lessen the likelihood of fraud. Similar things are happening with video advertising. As more and more marketers realize the effectiveness of the medium, and can prove it by fairly simple metrics, it is bringing about increased competition for limited space. While competition is not as fierce as it is with paid search, it is catching up quickly.
As the year 2006 begins, paid search and online video advertising are two hot items during this cold weather season. While both have their drawbacks, they are proving their effectiveness on a daily basis. As more and more marketers are shifting budgets to online (and have been for quite some time now), it is freeing up more dollars for paid search and leading edge technologies like video advertising. Now, who isn’t ready for a heat wave?
2006 Marketing Preview
Originally Published: November 2005
As the weather turns cold and our minds begin to focus on fighting traffic to get to the local WorldMart for another round of Christmas shopping, it’s time to look ahead at what 2006 might bring. 2006 is shaping up to be a very interesting year in the marketing world. The convergence of home entertainment, the growth of RFID, the increasing momentum of blogs, podcasts and mobile advertising, the continuing shift from traditional to new media and Google’s emerging dominance over everything information-related has marketers extremely excited and a just a little uneasy about what the future might bring.
Convergence of Home Entertainment
From my perspective as a consumer of all things electronic, the convergence of home entertainment is an exciting trend. It will not be long until our PC becomes the hub of home entertainment. 2006 should see the introduction of the first digital-cable-ready PC, which will turn your computer into an HD-capable cable box and becomes the nerve center of your home entertainment system. Want more proof that data, video, mobility and voice are converging? How about Cisco’s purchase of Scientific-Atlanta? As the proud renter of a Scientific-Atlanta set-top cable box and the proud owner of a Linksys (owned by Cisco) wireless router, this is huge news. It won’t be long before Cisco produces one device that includes digital cable TV capabilities, a cable modem, wireless LAN, VoIP and even high-definition TV. With a single device, users can download movies from the Internet and watch them on their televisions. With picture-in-picture, you could even surf the web while watching the Bengals game. It would mean true convergence, and it is not far away. Another example is Yahoo’s plan to stream old TV shows via the Web, and the company’s recent launch of a service that lets subscribers use the Web to schedule recordings of television shows through their TiVo digital video recorders. Forgot to record your favorite mid-morning game show? Just logon to Yahoo and set your recording. TV and the Web are slowly merging, and 2006 will see the first true steps toward visible convergence. The coming introduction of the Xbox 360 (basically a computer wrapped in a video game console box) won’t hurt either.
RFID
Around this time last year (and in this column), the easy prediction was that RFID was poised to explode onto the scene with the promise of great commercial opportunity. Radio Frequency Identification did indeed make great strides in 2005 mostly as an inventory management and control device, ensuring that products were available when and where customers required them. This technology has allowed businesses to begin to follow the product as it passes through logistical channels, from manufacturing through shipping and warehousing and onto store shelves. RFID also allows businesses to track shelf life and even identify where and when a product is purchased.
Whether you are a proponent of RFID or opposed to some aspects of it because of privacy concerns (as many consumer groups are), 2006 should see even more adoption as smaller, cheaper and more reliable devices are released. One example is NASCAR’s new tire leasing program from Goodyear. Goodyear will install RFID devices in all the tires it supplies to NASCAR under its tire leasing deal. This will allow the company to track thousands of tires throughout the season. Not only will RFID allow Goodyear to locate each and every tire, but also it will allow the company to study important data on the performance of each tire, which will potentially lead to better tire technology. As RFID technology continues to evolve, 2006 will see increased use of the devices and the data they supply. It won’t be long before marketers use RFID to very accurately and narrowly segment and target markets, identifying who purchased the product and then linking it to demographic data of the buyer to establish a profile that could then be applied to other potential buyers or market segments. RFID could be extended even further to identify where and when a product is consumed. This information could be utilized by companies to trigger end user contact to offer promotional incentives to re-purchase. Companies would be able to target customers on a truly individual basis and make product and distribution adjustments on the fly as they learn how and where their products are being purchased and consumed.
Blogs, Podcasts and Mobile Marketing
I have discussed web logs (blogs) and mobile marketing in previous columns, but they (like RFID) are worth repeating when discussing the trends of 2006. Blogs have for the most part already come of age (although we have only scratched the surface of using blogs for revenue generation), but 2006 will see mainstream adoption of podcasts and mobile marketing as well. Podcasts allow you to subscribe to a service that periodically sends an audio or video feed, which you can download and view or listen to on your computer or portable media player. Contrary to popular belief, you don’t need an iPod to use a podcasting service. Many syndicated radio shows have already begun podcasting feeds, and the technology is on the verge of exploding in popularity with the likes of the iPod itself. 2006 should see widespread use of the technology, and as it spreads, you can bet marketers will use it for precision commercial messages. As previously discussed, mobile marketing is entering into its adolescence stage. While it’s not quite mature enough to warrant large advertising budgets, its time will soon come. 2006 should bring mobile marketing into the mainstream as the public warms up to it and the technology grows up. Expect to see more text message contest entries, more ads in mobile games, use of mobile advergames, more subscription services, etc. Mobile commerce is still a good distance into the future, but mobile marketing is here.
Continuing Shift from Traditional to New Media
It is no secret that marketing dollars are being shifted from traditional media like newspapers, television, radio and magazines to new media including Web ads, pay-per-click ads, targeted emails, online and email newsletters and other forms of eMarketing. 2005 has seen explosive growth in eMarketing while newspaper and magazine ad page counts have dropped. The reason for this is simple, more and more consumers are paying attention to online media and content at the expense of traditional media. This trend, which will continue through 2006 and is here to stay, is most obvious in newspaper statistics. A recent report by the Audit Bureau of Circulations found a six-month decline in the average weekday print circulation among the top 20 U.S. newspapers. At the same time, newspaper website traffic grew by 11 percent year-over-year in October. Nielsen/NetRatings found interest in newspapers was still strong, but 22 percent of readers had shifted from offline to online sources, which was much stronger growth than the increase in Internet users as a whole, which rose 3 percent year-over-year. From these numbers, it is obvious that the trend is away from traditional media. Traditional media will not go away entirely, but as its effectiveness has declined, budgets have shifted to new media as a way to help recapture marketing message effectiveness and efficiency.
Google’s Emerging Dominance
From front-page headlines to record, skyrocketing profits, Google’s emerging dominance over all things related to information is another trend that sees no signs of slowing. Here is a snapshot of what Google has been up to lately:
- Currently the number one search engine
- Google AdWords has become a dominant form of online advertising that is garnering a significant share of advertising budgets
- Providing marketing support for the Firefox browser
- Offering free Wi-Fi
- Offering free web analytics (Google Analytics, aka Urchin)
- Trying its hand at newspaper and other off-line media buying
- Controversial Google Book Search library project promises to allow users to view the entire contents of every book not under copyright protection
- Beta test of Google Base
Firefox Marketing
Google is providing its ad publishers with a set of buttons that website visitors can use to download Firefox with the Google Toolbar. This agreement should accelerate the use of Firefox while continuing to spread the Google brand.
Google Analytics, aka Urchin
Urchin was previously offered by Google as a per-month pay service, but the company recently began offering the service free of charge. With this tool, businesses can gauge the impact of online marketing campaigns such as banner ads, referral links, newsletters and search. Businesses can also pay for more advanced integration and customization. The tool offers reporting dashboards for executives, marketers and Webmasters.
Google Base
Google’s new Google Base service lets anyone upload most anything to a publicly searchable database. This service will make locating anything that has been uploaded nearly instantaneous, provided it finds users willing to provide the content. Google Base could pose a formidable threat to traditional classified businesses such as newspapers, as well as online sites such as eBay. Google has also applied for a patent for a service called Google Automat that helps would-be sellers generate advertising and is working on an online payment system.
Google has significantly elevated its position from a search engine to a leading media and information clearinghouse. No one knows Google’s future intentions, but it is clear that 2006 will see Google continue to expand into other information-related businesses. As the company’s reach extends and as it develops other effective tools like AdWords, Google will continue to see a greater percentage of marketing budgets.
2006 is shaping up to be a very exciting year. Consumers will be able to streamline their home entertainment centers by bringing voice, data, video and mobility together, quickly and easily receive audio and video podcasts and have access more mobile content while marketers will see more effective, more efficient marketing tools hit the mainstream. While traditional media companies will feel the pinch of new media and technology, and marketers will need to continue to educate themselves on the benefits and metrics of new media, the benefits of these trends will outweigh the negatives. While not all of these trends are necessarily good for consumers (as many anti-RFID and Google haters would attest), they are all guaranteed to affect the way companies market themselves in 2006. Let’s start another trend this year: re-gifting old presents and skipping the hassle of another WorldMart trip. Who’s with me?
Tuesday, January 09, 2007
Gaming Continues to Score with Advertisers
Originally Published: October 2005
In previous columns, I have discussed how the nature of marketing has been steadily shifting over the last several years as consumers gain more and more control. They now have the power to skip over ads using DVRs, block online ads with ad-blockers in web browsers, block telemarketers by adding themselves to do-not-call lists, instantly research and compare similar product offerings online and have generally elevated their level of buying. No longer can a company produce a general ad for all markets, blast it out via mass media and expect a plethora of consumers beating down their door for the product. The new era of marketing requires highly targeted campaigns that reach prospects when each is ready to actively seek information about a particular product or service by way of the communication vehicle of choice. Because of this shift, marketers are constantly looking for the latest, most effective and efficient tools for reaching targeted prospects. One of the more recent trends is to target consumers where they “play”, using online and console (Xbox, PlayStation 2, GameCube, etc.) games.
There are two forms of advertising when it comes to games, in-game advertising and advergames. In-game advertising includes product placements, such as Nike shoes on a college basketball player in EA Sports’ NCAA basketball game, or in-game advertisements and sponsorships, such as advertising on a skateboard ramp in Tony Hawk’s Underground 2 game or a player entering the “Old Spice Red Zone” on EA Sports’ NCAA college football game. According to Deloitte Corporate Finance, product placement in games is expected to rise from $10 million in 2000 to $45 million in 2007, and, according to The Yankee Group, advertisers spent a total of $34 million on in-game advertisements in 2004 and that amount is expected to explode to $562 million by 2009. Advergames, on the other hand, are developed by a brand to further promote that brand. For example, on Jeep’s website, they have an entire page of “Jeep Games” where gamers can navigate difficult terrain in a Jeep or even pull competitor SUV’s out of the muck when they get stuck. According to The Yankee Group, including advergames, total game advertising will approach $1 billion by the end of the decade.
The reason advertisers are flocking to games is due to the nature of games themselves. Players become engaged and fully interact with the subject matter. This gives marketers a highly captive audience in which consumers can be taught about a brand while being entertained. If the game is effective (fun and engaging), consumers come away with a good impression of the brand and get excited about the product being offered. In addition to capturing gamers’ attention, games increase brand awareness, create positive associations between the game and a company’s brand or product and even increase purchase intent. Effective games deliver messages that influence consumers in a positive way and create active dialogue about the brand and products. Online games even allow you to easily track user behavior and gather important demographic data. You can also rotate ads within games easily, allowing you to switch ads at different times or to sell ads based on the number of impressions or games played.
However, companies cannot simply produce any game and instantly create a flock of rabid brand fans. The game has to have the right context/fit for the brand being promoted. For example, it would not be wise for squeaky-clean, kid-friendly Lego to create a violent first-person shooter game. You do not want to force the brand into a game. Instead, you should create the game around the brand. For example, navigating an all-terrain driving course is a perfect fit for the outdoorsy Jeep brand, as is a product placement in a basketball game for Nike shoes. Along with creating a game around a brand, it is important that in-game ads or product placements mirror real life as much as possible. An ad on the scoreboard in a football game seems natural because it occurs every time you turn on a football game but interrupting a car racing game in mid-action for the announcer to tell you about a new cologne would be obtrusive. The game/advertising mix should be seamless. The consumer should not be harangued, as savvy consumers will turn the game off or simply navigate to another site.
Another reason games are becoming so popular is the sheer volume of players. Some hit games have seen five hundred thousand to well over a million unique players over a 3- to 6-month period because if a gamer enjoys the game, he or she will forward it on to friends who in turn forward it on to their friends in true viral marketing fashion. Regularly, players spend anywhere from a few minutes to over an hour playing at one time. Considering most TV and radio commercials are 30-seconds in length, the “stickiness” of games is very appealing to advertisers and they basically get to repeat a several minute long commercial over and over again. Studies have also shown that games are capturing a larger share of consumer’s time at the expense of traditional media like TV. According to Sony, one of the strongest times for online gaming via the PlayStation 2 is from 5:00 to 11:00 pm. This means most PS2 gamers begin playing several hours prior to primetime and finish well after, so these players are either recording their favorite primetime programs (and most likely skipping the commercials) or ignoring the primetime lineup altogether.
According to researcher IDC, the main player in an average home spends more than two hours a day and four days a week playing video games, and other recent studies put the average age of players at 25 to 28 years old and getting older as those that grew up on video games begin to age. Surprisingly, according to Mediaweek, women over 40 spend the most hours per week playing online games, more than men and teens. They spend 9.1 hours per week playing (which makes up 41% of their total weekly time spent on the Web) whereas men spend 6.1 hours per week playing online games (which makes up 26% of their weekly Web time).
Music companies are even entering the gaming world as they place their artists in games where the music is repeated constantly throughout game play. Along with the music, an MTV-like listing of the artist, song title and CD title sometimes appears on the screen to further promote the band. Many game creators have begun selling these spots to advertisers including Electronic Arts and its Madden football game, the Grand Theft Auto series, which has become famous for its extensive soundtracks (among other things), as well as many other games.
While the upside of games is huge, there are some important things to consider when contemplating the production of a game. First, if you market to children, it is important that you be careful not to gather data from young gamers, as there are extensive privacy laws that are routinely enforced. In addition, it is important to note that with the growth of highly graphic-driven games, consumers increasingly expect more and more sophisticated games. If an advertiser is paying for a game, it is important that the quality be reflective of the price – consumers do not want to play another free solitaire game that they can find anywhere on the Web. Therefore, it is important that the game quality meet the audience’s expectations. If the brand requires a technically sophisticated game, it is important to note that high quality, cutting-edge games require a lengthy development process and costs can be higher than most people expect.
But if you have adequate time for development, in-game advertising and advergames can be very effective tools for reaching your target audience, capturing their attention, building positive brand associations, creating buzz around your brand and even driving consumers to purchase. Any one up for a little Madden football? I’ll even let you pick the teams.
In previous columns, I have discussed how the nature of marketing has been steadily shifting over the last several years as consumers gain more and more control. They now have the power to skip over ads using DVRs, block online ads with ad-blockers in web browsers, block telemarketers by adding themselves to do-not-call lists, instantly research and compare similar product offerings online and have generally elevated their level of buying. No longer can a company produce a general ad for all markets, blast it out via mass media and expect a plethora of consumers beating down their door for the product. The new era of marketing requires highly targeted campaigns that reach prospects when each is ready to actively seek information about a particular product or service by way of the communication vehicle of choice. Because of this shift, marketers are constantly looking for the latest, most effective and efficient tools for reaching targeted prospects. One of the more recent trends is to target consumers where they “play”, using online and console (Xbox, PlayStation 2, GameCube, etc.) games.
There are two forms of advertising when it comes to games, in-game advertising and advergames. In-game advertising includes product placements, such as Nike shoes on a college basketball player in EA Sports’ NCAA basketball game, or in-game advertisements and sponsorships, such as advertising on a skateboard ramp in Tony Hawk’s Underground 2 game or a player entering the “Old Spice Red Zone” on EA Sports’ NCAA college football game. According to Deloitte Corporate Finance, product placement in games is expected to rise from $10 million in 2000 to $45 million in 2007, and, according to The Yankee Group, advertisers spent a total of $34 million on in-game advertisements in 2004 and that amount is expected to explode to $562 million by 2009. Advergames, on the other hand, are developed by a brand to further promote that brand. For example, on Jeep’s website, they have an entire page of “Jeep Games” where gamers can navigate difficult terrain in a Jeep or even pull competitor SUV’s out of the muck when they get stuck. According to The Yankee Group, including advergames, total game advertising will approach $1 billion by the end of the decade.
The reason advertisers are flocking to games is due to the nature of games themselves. Players become engaged and fully interact with the subject matter. This gives marketers a highly captive audience in which consumers can be taught about a brand while being entertained. If the game is effective (fun and engaging), consumers come away with a good impression of the brand and get excited about the product being offered. In addition to capturing gamers’ attention, games increase brand awareness, create positive associations between the game and a company’s brand or product and even increase purchase intent. Effective games deliver messages that influence consumers in a positive way and create active dialogue about the brand and products. Online games even allow you to easily track user behavior and gather important demographic data. You can also rotate ads within games easily, allowing you to switch ads at different times or to sell ads based on the number of impressions or games played.
However, companies cannot simply produce any game and instantly create a flock of rabid brand fans. The game has to have the right context/fit for the brand being promoted. For example, it would not be wise for squeaky-clean, kid-friendly Lego to create a violent first-person shooter game. You do not want to force the brand into a game. Instead, you should create the game around the brand. For example, navigating an all-terrain driving course is a perfect fit for the outdoorsy Jeep brand, as is a product placement in a basketball game for Nike shoes. Along with creating a game around a brand, it is important that in-game ads or product placements mirror real life as much as possible. An ad on the scoreboard in a football game seems natural because it occurs every time you turn on a football game but interrupting a car racing game in mid-action for the announcer to tell you about a new cologne would be obtrusive. The game/advertising mix should be seamless. The consumer should not be harangued, as savvy consumers will turn the game off or simply navigate to another site.
Another reason games are becoming so popular is the sheer volume of players. Some hit games have seen five hundred thousand to well over a million unique players over a 3- to 6-month period because if a gamer enjoys the game, he or she will forward it on to friends who in turn forward it on to their friends in true viral marketing fashion. Regularly, players spend anywhere from a few minutes to over an hour playing at one time. Considering most TV and radio commercials are 30-seconds in length, the “stickiness” of games is very appealing to advertisers and they basically get to repeat a several minute long commercial over and over again. Studies have also shown that games are capturing a larger share of consumer’s time at the expense of traditional media like TV. According to Sony, one of the strongest times for online gaming via the PlayStation 2 is from 5:00 to 11:00 pm. This means most PS2 gamers begin playing several hours prior to primetime and finish well after, so these players are either recording their favorite primetime programs (and most likely skipping the commercials) or ignoring the primetime lineup altogether.
According to researcher IDC, the main player in an average home spends more than two hours a day and four days a week playing video games, and other recent studies put the average age of players at 25 to 28 years old and getting older as those that grew up on video games begin to age. Surprisingly, according to Mediaweek, women over 40 spend the most hours per week playing online games, more than men and teens. They spend 9.1 hours per week playing (which makes up 41% of their total weekly time spent on the Web) whereas men spend 6.1 hours per week playing online games (which makes up 26% of their weekly Web time).
Music companies are even entering the gaming world as they place their artists in games where the music is repeated constantly throughout game play. Along with the music, an MTV-like listing of the artist, song title and CD title sometimes appears on the screen to further promote the band. Many game creators have begun selling these spots to advertisers including Electronic Arts and its Madden football game, the Grand Theft Auto series, which has become famous for its extensive soundtracks (among other things), as well as many other games.
While the upside of games is huge, there are some important things to consider when contemplating the production of a game. First, if you market to children, it is important that you be careful not to gather data from young gamers, as there are extensive privacy laws that are routinely enforced. In addition, it is important to note that with the growth of highly graphic-driven games, consumers increasingly expect more and more sophisticated games. If an advertiser is paying for a game, it is important that the quality be reflective of the price – consumers do not want to play another free solitaire game that they can find anywhere on the Web. Therefore, it is important that the game quality meet the audience’s expectations. If the brand requires a technically sophisticated game, it is important to note that high quality, cutting-edge games require a lengthy development process and costs can be higher than most people expect.
But if you have adequate time for development, in-game advertising and advergames can be very effective tools for reaching your target audience, capturing their attention, building positive brand associations, creating buzz around your brand and even driving consumers to purchase. Any one up for a little Madden football? I’ll even let you pick the teams.
Holiday E-Commerce Forecast: Mostly Sunny
Originally Published: September 2005
As we prepare to enter the busy holiday shopping season (and yes it is right around the corner), most researchers are forecasting a rosy outlook for online retail sales – as long as gas prices don’t get in the way. Because e-commerce spending has been on the rise for all of 2005, most industry experts are predicting that trend to continue, which will translate into a healthy online shopping season.
The Commerce Department recently released its second quarter 2005 U.S. online retail sales numbers. The report revealed that second quarter online spending increased to $19.8 billion, which is significantly higher than last year’s second quarter spending of $15.75 billion. The $19.8 billion is also approaching the $21.52 billion that, according to the Commerce Department, shoppers spent online for last year’s fourth quarter holiday shopping season (by far the busiest quarter of the year). For all of 2005, eMarketer expects online retail sales to increase 22.1% over last year’s $69.2 billion to reach $84.5 billion. Shop.org and Forrester Research’s The State of Retailing Online 8.0 report agrees that online retail sales will be up 22% over 2004.
Of these billions of dollars in online sales, The State of Retailing Online 8.0 report predicts that products largely purchased by women will experience accelerated growth as more and more women use the Web for shopping. The online retail categories expected to see significant growth are cosmetics and fragrances (33% growth over 2004), jewelry and luxury goods (31%) and flowers, cards and gifts (30%).
However, lofty holiday season online sales predictions must be tempered with recent events that have caused rising gasoline and heating oil prices, climbing interest rates and general retail market uncertainty caused by low consumer sentiment. As such, The National Retail Federation is predicting 5% growth in overall retail spending this holiday season over 2004. While 5% is decent growth, it is significantly lower than last year’s 6.7% growth over 2003. Ernst & Young agrees that this season will see a slight slowdown over the 2004 holiday shopping season at 6% to 7% growth versus last year’s 8.3% growth. Even with these tempered projections and the uncertainty in the marketplace, The National Retail Federation believes the strong second and third quarter 2005 may mean a solid holiday season. In addition, these predictions may cause retailers to lower their prices to spur early season sales, which may eat into retailer profit margins but will make shoppers happy. Moreover, these market factors may actually be good for online retailers as rising gas prices may drive more shoppers online versus running all over town to find that perfect gift.
To spur holiday sales, eMarketer reports that holiday shoppers will be frequently offered free shipping, even more so than during previous holiday seasons. According to the report, more than 60% of U.S. online retailers plan to use free shipping this year as a reward and incentive for return customers. eMarketer expects other loyalty programs including value-added promotions, online-only sale prices and repeat buyer discounts to appear this holiday season. As consumers increasingly scrutinize their purchases and whom they buy from online, they will continue to heighten expectations of the online shopping experience. Some decision factors for choosing an online retail website this holiday season include price, product selection, ease of use, low shipping costs or free shipping, previous site registration/returning customers and trust in the brand name of the products or company.
Researchers agree that the 2005 holiday shopping season will be the most successful ever for online retailers. While the general retail industry will see a slowdown in growth due to energy prices, as well as other external factors, online retailers may be the beneficiary of those same impediments as buyers turn to the Web instead of driving all over town. Overall, the forecast for this holiday shopping season is mostly sunny with a chance of a cloud or two. Have you finished your shopping list?
As we prepare to enter the busy holiday shopping season (and yes it is right around the corner), most researchers are forecasting a rosy outlook for online retail sales – as long as gas prices don’t get in the way. Because e-commerce spending has been on the rise for all of 2005, most industry experts are predicting that trend to continue, which will translate into a healthy online shopping season.
The Commerce Department recently released its second quarter 2005 U.S. online retail sales numbers. The report revealed that second quarter online spending increased to $19.8 billion, which is significantly higher than last year’s second quarter spending of $15.75 billion. The $19.8 billion is also approaching the $21.52 billion that, according to the Commerce Department, shoppers spent online for last year’s fourth quarter holiday shopping season (by far the busiest quarter of the year). For all of 2005, eMarketer expects online retail sales to increase 22.1% over last year’s $69.2 billion to reach $84.5 billion. Shop.org and Forrester Research’s The State of Retailing Online 8.0 report agrees that online retail sales will be up 22% over 2004.
Of these billions of dollars in online sales, The State of Retailing Online 8.0 report predicts that products largely purchased by women will experience accelerated growth as more and more women use the Web for shopping. The online retail categories expected to see significant growth are cosmetics and fragrances (33% growth over 2004), jewelry and luxury goods (31%) and flowers, cards and gifts (30%).
However, lofty holiday season online sales predictions must be tempered with recent events that have caused rising gasoline and heating oil prices, climbing interest rates and general retail market uncertainty caused by low consumer sentiment. As such, The National Retail Federation is predicting 5% growth in overall retail spending this holiday season over 2004. While 5% is decent growth, it is significantly lower than last year’s 6.7% growth over 2003. Ernst & Young agrees that this season will see a slight slowdown over the 2004 holiday shopping season at 6% to 7% growth versus last year’s 8.3% growth. Even with these tempered projections and the uncertainty in the marketplace, The National Retail Federation believes the strong second and third quarter 2005 may mean a solid holiday season. In addition, these predictions may cause retailers to lower their prices to spur early season sales, which may eat into retailer profit margins but will make shoppers happy. Moreover, these market factors may actually be good for online retailers as rising gas prices may drive more shoppers online versus running all over town to find that perfect gift.
To spur holiday sales, eMarketer reports that holiday shoppers will be frequently offered free shipping, even more so than during previous holiday seasons. According to the report, more than 60% of U.S. online retailers plan to use free shipping this year as a reward and incentive for return customers. eMarketer expects other loyalty programs including value-added promotions, online-only sale prices and repeat buyer discounts to appear this holiday season. As consumers increasingly scrutinize their purchases and whom they buy from online, they will continue to heighten expectations of the online shopping experience. Some decision factors for choosing an online retail website this holiday season include price, product selection, ease of use, low shipping costs or free shipping, previous site registration/returning customers and trust in the brand name of the products or company.
Researchers agree that the 2005 holiday shopping season will be the most successful ever for online retailers. While the general retail industry will see a slowdown in growth due to energy prices, as well as other external factors, online retailers may be the beneficiary of those same impediments as buyers turn to the Web instead of driving all over town. Overall, the forecast for this holiday shopping season is mostly sunny with a chance of a cloud or two. Have you finished your shopping list?
Open Source Tools Offer Up Cost-Free Productivity
Originally Published: August 2005
In a previous article, I touted the benefits of the open source web browser Firefox. The primary reason Firefox took off so quickly and became a hit is because of its open source framework. Not only does open source make it free to use, but it also allows the code to be a living document, constantly being updated and improved upon. Because of the software’s constant updates, stability and security, Firefox has been a success with developers and common users alike. However, Firefox is not the only piece of open source software that is making waves with both audiences. OpenOffice.org and Sugar Open Source CRM are two other tools that benefit users, as well as programmers.
OpenOffice.org recently released a new version of its OpenOffice.org suite of productivity tools for use on Windows, Mac OS X, Linux, FreeBSD and Solaris platforms. The OpenOffice.org productivity suite is very similar to Microsoft Office in that it includes a word processor (named WRITER), a spreadsheet application (CALC), a graphics program (DRAW) and a presentation design application (IMPRESS). The suite is designed to compete directly with Microsoft Office with one major difference… a price tag of $0. Along with similar functionality to Microsoft Word, Excel and PowerPoint, the latest release of OpenOffice.org features PDF and Macromedia Flash export capabilities and enhanced Microsoft Office file compatibility.
Adobe PDF Export
With OpenOffice.org’s PDF export feature, you can export any document, spreadsheet or presentation directly to Adobe PDF format without the need for additional software.
Macromedia Flash Export
This feature allows you to export presentations directly to Macromedia Flash, allowing for easy distribution or embedding into web pages.
Mobile Formats
In addition to PDF and Flash export, OpenOffice.org has added support for Palm, Pocket Word and Pocket Excel for easy transfer to PDA's and handheld devices.
In addition to the convenience of a free suite of productivity tools, OpenOffice.org offers users the benefits of thousands of programmers constantly tweaking and updating the software. Therefore, bugs are fixed and patches created much more quickly than for a piece of traditional software. And, free software upgrades are released much more often. However, the one downside to OpenOffice.org is its current lack of a program similar to Microsoft Access. Reports state that the organization is working on an Access compatible program, but currently no such program exists.
Along with OpenOffice.org, another open source program gaining ground is Sugar Open Source, a web-based Customer Relationship Management (CRM) software program that includes sales, marketing and support functions. Instead of purchasing high-priced packaged CRM software, Sugar Open Source provides the essentials in a free, user-friendly (and more importantly, programmer-friendly) package.
Sugar Open Source gives users the following abilities:
· Create and manage appointments
· Track and set tasks
· Track sales leads
· Import, create and track contacts
· Create and track accounts
· Set up meetings by email invitation
· Track calls and set reminder calls
· Create and review notes
· Create, import and export vCards
· Compose and send email with attachments
· Import data from other sources including Salesforce.com, Microsoft Outlook and Act!
· Accurate, visual snapshot of your sales function via dashboard function
As you can see from this list, Sugar Open Source is a full-featured program that can compete with many of the off-the-shelf CRM products on the market such as Act! and Goldmine. Because the system is web-based and written in PHP and MySQL, it is also very easy to customize. The addition of new modules and more complex programming such as integrating intranets into the Sugar Open Source software is relatively simple. And like OpenOffice.org, Sugar Open Source is cost-free to the user.
Open source tools are becoming more widespread as their sophistication evolves to the point where they can realistically compete head-to-head with popular, expensive off-the-shelf products. As Firefox has cut into Internet Explorer's market share, OpenOffice.org and Sugar Open Source are lining themselves up to do just that with Microsoft Office and Act!, respectively. While these two pieces of software may not have the bells and whistles of Office or Act!, they do offer similar functionality. And, the price tag more than makes up for what they lack. Who knows, we soon might be giving IMPRESS presentations, creating WRITER documents and inviting the HR director to a company meeting using Sugar Open Source.
In a previous article, I touted the benefits of the open source web browser Firefox. The primary reason Firefox took off so quickly and became a hit is because of its open source framework. Not only does open source make it free to use, but it also allows the code to be a living document, constantly being updated and improved upon. Because of the software’s constant updates, stability and security, Firefox has been a success with developers and common users alike. However, Firefox is not the only piece of open source software that is making waves with both audiences. OpenOffice.org and Sugar Open Source CRM are two other tools that benefit users, as well as programmers.
OpenOffice.org recently released a new version of its OpenOffice.org suite of productivity tools for use on Windows, Mac OS X, Linux, FreeBSD and Solaris platforms. The OpenOffice.org productivity suite is very similar to Microsoft Office in that it includes a word processor (named WRITER), a spreadsheet application (CALC), a graphics program (DRAW) and a presentation design application (IMPRESS). The suite is designed to compete directly with Microsoft Office with one major difference… a price tag of $0. Along with similar functionality to Microsoft Word, Excel and PowerPoint, the latest release of OpenOffice.org features PDF and Macromedia Flash export capabilities and enhanced Microsoft Office file compatibility.
Adobe PDF Export
With OpenOffice.org’s PDF export feature, you can export any document, spreadsheet or presentation directly to Adobe PDF format without the need for additional software.
Macromedia Flash Export
This feature allows you to export presentations directly to Macromedia Flash, allowing for easy distribution or embedding into web pages.
Mobile Formats
In addition to PDF and Flash export, OpenOffice.org has added support for Palm, Pocket Word and Pocket Excel for easy transfer to PDA's and handheld devices.
In addition to the convenience of a free suite of productivity tools, OpenOffice.org offers users the benefits of thousands of programmers constantly tweaking and updating the software. Therefore, bugs are fixed and patches created much more quickly than for a piece of traditional software. And, free software upgrades are released much more often. However, the one downside to OpenOffice.org is its current lack of a program similar to Microsoft Access. Reports state that the organization is working on an Access compatible program, but currently no such program exists.
Along with OpenOffice.org, another open source program gaining ground is Sugar Open Source, a web-based Customer Relationship Management (CRM) software program that includes sales, marketing and support functions. Instead of purchasing high-priced packaged CRM software, Sugar Open Source provides the essentials in a free, user-friendly (and more importantly, programmer-friendly) package.
Sugar Open Source gives users the following abilities:
· Create and manage appointments
· Track and set tasks
· Track sales leads
· Import, create and track contacts
· Create and track accounts
· Set up meetings by email invitation
· Track calls and set reminder calls
· Create and review notes
· Create, import and export vCards
· Compose and send email with attachments
· Import data from other sources including Salesforce.com, Microsoft Outlook and Act!
· Accurate, visual snapshot of your sales function via dashboard function
As you can see from this list, Sugar Open Source is a full-featured program that can compete with many of the off-the-shelf CRM products on the market such as Act! and Goldmine. Because the system is web-based and written in PHP and MySQL, it is also very easy to customize. The addition of new modules and more complex programming such as integrating intranets into the Sugar Open Source software is relatively simple. And like OpenOffice.org, Sugar Open Source is cost-free to the user.
Open source tools are becoming more widespread as their sophistication evolves to the point where they can realistically compete head-to-head with popular, expensive off-the-shelf products. As Firefox has cut into Internet Explorer's market share, OpenOffice.org and Sugar Open Source are lining themselves up to do just that with Microsoft Office and Act!, respectively. While these two pieces of software may not have the bells and whistles of Office or Act!, they do offer similar functionality. And, the price tag more than makes up for what they lack. Who knows, we soon might be giving IMPRESS presentations, creating WRITER documents and inviting the HR director to a company meeting using Sugar Open Source.
Monday, January 08, 2007
Mobile Marketing Emerges
Originally Published: July 2005
Hold onto your cell phones – mobile marketing is poised for explosive growth. According to the Mobile Marketing Association, there are 350 billion Short Message Service (SMS), or text, messages sent worldwide per month. Of those 350 billion, the group states that approximately 15% (or 52.5 billion messages) are commercial/marketing messages. While the number of commercial messages already seems enormous, marketers see the massive opportunity for more growth.
eMarketer predicts that U.S. mobile marketing spending will increase 22% from $115 million this year to $254.8 million by 2009. Even though eMarketer predicts a slight dip in spending around the year 2007, they are fully confident that mobile marketing will become another mainstream interactive marketing tactic, albeit not as popular as stalwarts like email, pay-per-click, etc. The reasons for the predicted explosive growth are the interactive, up-close and personal aspect of the medium, as well as its current effectiveness. Business 2.0 reports that current response rates for mobile opt-in subscribers are as high as 70%. It is important to note that these response rates are for opt-in messages, and the response rates will most certainly decline somewhat as clutter builds in the medium… much like email response rates have fallen due to the rise of spam.
In addition to response rates, marketers are intrigued by the fact that mobile marketing provides:
- A direct marketing channel to the end user of a product or service
- An uncluttered environment which maximizes commercial impact
- Context and time relevancy
- An instant response mechanism providing true one-to-one communication
- Easy tracking and measurement
Utilizing these inherent benefits, mobile marketing can be an effective tactic for brand building, driving customer acquisition and strengthening current customer relationships.
There are several forms mobile marketing can take including ads, sponsorships, one-off campaigns and contests, subscriptions, relationship building messages and commerce. Below, you will find an example of each form:
Ads and Sponsorships:
Mobile games will build in sponsorship components. For example, if you are playing a bowling game on your phone and roll a strike, you might see an animation for the “Lucky Strike Cigarette’s Lucky Strike of the Game”. Another example could be a football game. An animation might appear when a team enters the “Old Spice Red Zone”. These types of sponsorships are commonplace in traditional PC and console games, so it seems likely that they will soon appear in mobile games.
One-Off Campaigns and Contests:
Let’s say you go grocery shopping at Kroger and see a point of purchase display for Coca-Cola. Coke is running a contest to win a lifetime’s supply of Coke. So, you buy a case, find the game piece on the inside of the package, scratch to find a code, SMS the code and contact information to the special contest phone number and you are instantly entered into the contest. Another example for this type of campaign is American Idol’s now famous weekly vote where the number of text and traditional phone votes each contestant received for the week determined the person voted off each week.
Subscription Services:
Paid and “free” SMS subscriptions for news, weather, sports, traffic, etc. are another major SMS service. You sign up for a service and receive an SMS with the information that you request. “Free” subscriptions will include a sponsorship component, so that it is free to the consumer as long as he or she does not mind the occasional commercial message.
Relationship Building:
True one-to-one communication is very difficult to achieve with traditional marketing and the true one-to-one options that exist are expensive (i.e., a direct sales force). However, with SMS, customer interactions cost a fraction of what they would cost when using other tactics. A good example of relationship building would be a promotion from your car dealership that tells you when your car is due for an oil change. The SMS could even offer a code that you present to the dealer for $5 off.
Commerce:
While cell phone commerce is still in its infancy stage, the future opportunities for cell phone commerce are unlimited. Just one example might be that you receive an SMS message saying that if you buy a shirt from Gap in the next five minutes from your web-enabled phone you get 20% off.
When launching any one of these types of mobile marketing campaigns, it is important to follow the Mobile Marketing Association guidelines for mobile marketers, which include:
- Not sending unsolicited messages
- Obtaining single opt-in permission for standard rate messages
- Obtaining double opt-in permission for premium content
- Sending reminder messages prior to the renewal of any subscriptions
- No minimum subscription period requirements
- Allowing easy opt-out access
- Constantly maintaining truth in advertising and avoiding deceptive claims
These guidelines have been designed to limit spam and minimize intrusion on consumers. Since cell phones are very personal devices, it is important that mobile marketers protect the rights of users.
While the future for mobile marketing looks highly positive, the shape of the industry itself may hinder growth to a certain degree. The chief problem is that the industry is very disjointed with many different content providers, application providers, network aggregators and wireless operators. This lack of cohesiveness makes it difficult to standardize for a mass campaign and could slow growth until the industry standardizes.
Even with a lack of industry cohesiveness, mobile marketing will soon become a part of integrated marketing campaigns across the United States and will be incorporated more quickly as mobile marketing moves from SMS to multimedia promotions that include photos, audio and video. It is important to note that mobile marketing will never stand on its own as a marketing tool, but should be used in conjunction with other marketing tools such as traditional and online advertising, public relations, etc. to create an integrated program. This powerful combination of marketing tools will strike the optimal marketing balance of mass cost-effectiveness and one-to-one personalization. Is your current marketing program properly balanced?
Hold onto your cell phones – mobile marketing is poised for explosive growth. According to the Mobile Marketing Association, there are 350 billion Short Message Service (SMS), or text, messages sent worldwide per month. Of those 350 billion, the group states that approximately 15% (or 52.5 billion messages) are commercial/marketing messages. While the number of commercial messages already seems enormous, marketers see the massive opportunity for more growth.
eMarketer predicts that U.S. mobile marketing spending will increase 22% from $115 million this year to $254.8 million by 2009. Even though eMarketer predicts a slight dip in spending around the year 2007, they are fully confident that mobile marketing will become another mainstream interactive marketing tactic, albeit not as popular as stalwarts like email, pay-per-click, etc. The reasons for the predicted explosive growth are the interactive, up-close and personal aspect of the medium, as well as its current effectiveness. Business 2.0 reports that current response rates for mobile opt-in subscribers are as high as 70%. It is important to note that these response rates are for opt-in messages, and the response rates will most certainly decline somewhat as clutter builds in the medium… much like email response rates have fallen due to the rise of spam.
In addition to response rates, marketers are intrigued by the fact that mobile marketing provides:
- A direct marketing channel to the end user of a product or service
- An uncluttered environment which maximizes commercial impact
- Context and time relevancy
- An instant response mechanism providing true one-to-one communication
- Easy tracking and measurement
Utilizing these inherent benefits, mobile marketing can be an effective tactic for brand building, driving customer acquisition and strengthening current customer relationships.
There are several forms mobile marketing can take including ads, sponsorships, one-off campaigns and contests, subscriptions, relationship building messages and commerce. Below, you will find an example of each form:
Ads and Sponsorships:
Mobile games will build in sponsorship components. For example, if you are playing a bowling game on your phone and roll a strike, you might see an animation for the “Lucky Strike Cigarette’s Lucky Strike of the Game”. Another example could be a football game. An animation might appear when a team enters the “Old Spice Red Zone”. These types of sponsorships are commonplace in traditional PC and console games, so it seems likely that they will soon appear in mobile games.
One-Off Campaigns and Contests:
Let’s say you go grocery shopping at Kroger and see a point of purchase display for Coca-Cola. Coke is running a contest to win a lifetime’s supply of Coke. So, you buy a case, find the game piece on the inside of the package, scratch to find a code, SMS the code and contact information to the special contest phone number and you are instantly entered into the contest. Another example for this type of campaign is American Idol’s now famous weekly vote where the number of text and traditional phone votes each contestant received for the week determined the person voted off each week.
Subscription Services:
Paid and “free” SMS subscriptions for news, weather, sports, traffic, etc. are another major SMS service. You sign up for a service and receive an SMS with the information that you request. “Free” subscriptions will include a sponsorship component, so that it is free to the consumer as long as he or she does not mind the occasional commercial message.
Relationship Building:
True one-to-one communication is very difficult to achieve with traditional marketing and the true one-to-one options that exist are expensive (i.e., a direct sales force). However, with SMS, customer interactions cost a fraction of what they would cost when using other tactics. A good example of relationship building would be a promotion from your car dealership that tells you when your car is due for an oil change. The SMS could even offer a code that you present to the dealer for $5 off.
Commerce:
While cell phone commerce is still in its infancy stage, the future opportunities for cell phone commerce are unlimited. Just one example might be that you receive an SMS message saying that if you buy a shirt from Gap in the next five minutes from your web-enabled phone you get 20% off.
When launching any one of these types of mobile marketing campaigns, it is important to follow the Mobile Marketing Association guidelines for mobile marketers, which include:
- Not sending unsolicited messages
- Obtaining single opt-in permission for standard rate messages
- Obtaining double opt-in permission for premium content
- Sending reminder messages prior to the renewal of any subscriptions
- No minimum subscription period requirements
- Allowing easy opt-out access
- Constantly maintaining truth in advertising and avoiding deceptive claims
These guidelines have been designed to limit spam and minimize intrusion on consumers. Since cell phones are very personal devices, it is important that mobile marketers protect the rights of users.
While the future for mobile marketing looks highly positive, the shape of the industry itself may hinder growth to a certain degree. The chief problem is that the industry is very disjointed with many different content providers, application providers, network aggregators and wireless operators. This lack of cohesiveness makes it difficult to standardize for a mass campaign and could slow growth until the industry standardizes.
Even with a lack of industry cohesiveness, mobile marketing will soon become a part of integrated marketing campaigns across the United States and will be incorporated more quickly as mobile marketing moves from SMS to multimedia promotions that include photos, audio and video. It is important to note that mobile marketing will never stand on its own as a marketing tool, but should be used in conjunction with other marketing tools such as traditional and online advertising, public relations, etc. to create an integrated program. This powerful combination of marketing tools will strike the optimal marketing balance of mass cost-effectiveness and one-to-one personalization. Is your current marketing program properly balanced?
Successful E-Mail Marketing
Originally Published: June 2005
While spam laws and filters have reduced companies’ reliance on e-mail marketing over the last year or so, it remains a very effective tool for customer relationship building and management. In addition, e-mail continues to be effective at maintaining and building those relationships into greater sales over time. While the shine has somewhat come off using e-mail as a lead generation tool, the cost-benefit efficiency of the medium begs for its continued and even expanded use.
In a recent report by eMarketer, their researchers state that e-mail lags behind telemarketing, direct mail, catalogs and coupons in response rate at 1.12%. However, e-mail marketing ranked second in overall direct marketing efficiency when the researchers factored in cost per contact and revenue per contact along with the response rate. By factoring in the cost and revenue per contact, e-mail jumps to the front of the pack, placing behind only telemarketing and above such direct marketing stalwarts as direct mail, newspaper, radio, television, catalogs and coupons in overall cost-benefit efficiency.
However, there are some guidelines marketers should follow when instituting an email program:
- Use e-mail as part of an integrated marketing plan
- Set up a user-friendly e-mail registration form on your website and obtain opt-in (or double opt-in) permission before sending out an email campaign
- Make sure the message complies with current spam laws
- Use only relevant content and give customers what they want instead of what you want to push on them
- Clearly communicate one strong call to action per email as multiple marketing messages in the same communication can confuse recipients and dilute your message
- Personalize your email campaign
The first step in a successful customer relationship building e-mail campaign is to use it as part of an overall integrated marketing plan. E-mail is only one of many effective marketing tactics for building relationships and generating sales, and like all other tactics, it is most effective when used in combination with multiple forms of marketing.
It is always extremely important that your e-mail campaign be directed only to those that have opted-in or double opted-in to your e-mail list. Sending unsolicited email not only lowers your response rate but also if you don’t follow current spam laws closely, can land your campaign in hot water. In order to build a strong opt-in list, it is important that you make it very easy for your website visitors to register to receive emails. Silverpop conducted a study on e-mail marketing and found that as many as 23% of companies in their study failed to include email registration forms on their website homepage. By doing so, companies drastically limit their ability to build strong email lists of willing and oftentimes eager recipients.
Along with a high percentage of companies burying their email registration forms on internal pages, Silverpop found that nearly 80% of companies only offer one choice of communication vehicle when registering. Instead of offering prospects the choice of selecting one or more vehicles like a newsletter, notices of sales or special discounts, coupons, etc., most companies only offer a check box that opts-in to receive emails from the company. Silverpop stated, “The ability to provide content preferences and a variety of choices can help increase the number of people who will opt-in to receive email messages from a company because they know the communications will be more tailored to their needs.” Offering a variety of communication options allows customers to tailor the messages they receive, making them more likely to open and respond to your email campaign.
Along with offering various communications options, you should use only relevant content in your emails. Basically, give customers what they want instead of what you want to push on them. Clearly communicate one strong call to action per email as multiple marketing messages in the same communication can confuse recipients and will dilute your message.
Once you have created a strong message, test it on a small segment of your list. Try sending the messages at different times and different days and measure the open and click-through rates. This will help you establish the optimal day and time to send emails to your list. Also, try sending email with the same overall message or offer but with different content. This will help you establish what type of content your audience prefers and/or responds to.
In addition to the content of your email, personalization can also have a profound impact on building customer relationships. However, few companies make the effort to personalize emails, even when a prospect specifically requests a communication from a company. Silverpop’s study found that 75% of retailers do not respond to prospects’ requests with even simple personalization like the recipient’s name. In a traditional sales setting where a salesperson meets with a prospect directly, it is important for that salesperson to build rapport and confidence in the prospect by using such techniques as repeating the prospects name. E-mail communication can and should be the same way. Personalizing e-mail can be your company’s virtual handshake to a prospect. Along with Silverpop’s findings, recent studies by JupiterResearch have shown that response rates increase when even simple personalization is used.
While e-mail is not as effective when used purely as a prospecting tool, it can be very effective at building customer relationships and driving sales over the long term. According to BtoB magazine, “when properly used, e-mail can balance low costs and high response rates better than other marketing media. But, the challenge is to maximize its effectiveness through improved content, targeting and tracking.” By following some simple guidelines, you can create a successful email campaign. Your customers are looking for prime rib; don’t make them settle for spam.
While spam laws and filters have reduced companies’ reliance on e-mail marketing over the last year or so, it remains a very effective tool for customer relationship building and management. In addition, e-mail continues to be effective at maintaining and building those relationships into greater sales over time. While the shine has somewhat come off using e-mail as a lead generation tool, the cost-benefit efficiency of the medium begs for its continued and even expanded use.
In a recent report by eMarketer, their researchers state that e-mail lags behind telemarketing, direct mail, catalogs and coupons in response rate at 1.12%. However, e-mail marketing ranked second in overall direct marketing efficiency when the researchers factored in cost per contact and revenue per contact along with the response rate. By factoring in the cost and revenue per contact, e-mail jumps to the front of the pack, placing behind only telemarketing and above such direct marketing stalwarts as direct mail, newspaper, radio, television, catalogs and coupons in overall cost-benefit efficiency.
However, there are some guidelines marketers should follow when instituting an email program:
- Use e-mail as part of an integrated marketing plan
- Set up a user-friendly e-mail registration form on your website and obtain opt-in (or double opt-in) permission before sending out an email campaign
- Make sure the message complies with current spam laws
- Use only relevant content and give customers what they want instead of what you want to push on them
- Clearly communicate one strong call to action per email as multiple marketing messages in the same communication can confuse recipients and dilute your message
- Personalize your email campaign
The first step in a successful customer relationship building e-mail campaign is to use it as part of an overall integrated marketing plan. E-mail is only one of many effective marketing tactics for building relationships and generating sales, and like all other tactics, it is most effective when used in combination with multiple forms of marketing.
It is always extremely important that your e-mail campaign be directed only to those that have opted-in or double opted-in to your e-mail list. Sending unsolicited email not only lowers your response rate but also if you don’t follow current spam laws closely, can land your campaign in hot water. In order to build a strong opt-in list, it is important that you make it very easy for your website visitors to register to receive emails. Silverpop conducted a study on e-mail marketing and found that as many as 23% of companies in their study failed to include email registration forms on their website homepage. By doing so, companies drastically limit their ability to build strong email lists of willing and oftentimes eager recipients.
Along with a high percentage of companies burying their email registration forms on internal pages, Silverpop found that nearly 80% of companies only offer one choice of communication vehicle when registering. Instead of offering prospects the choice of selecting one or more vehicles like a newsletter, notices of sales or special discounts, coupons, etc., most companies only offer a check box that opts-in to receive emails from the company. Silverpop stated, “The ability to provide content preferences and a variety of choices can help increase the number of people who will opt-in to receive email messages from a company because they know the communications will be more tailored to their needs.” Offering a variety of communication options allows customers to tailor the messages they receive, making them more likely to open and respond to your email campaign.
Along with offering various communications options, you should use only relevant content in your emails. Basically, give customers what they want instead of what you want to push on them. Clearly communicate one strong call to action per email as multiple marketing messages in the same communication can confuse recipients and will dilute your message.
Once you have created a strong message, test it on a small segment of your list. Try sending the messages at different times and different days and measure the open and click-through rates. This will help you establish the optimal day and time to send emails to your list. Also, try sending email with the same overall message or offer but with different content. This will help you establish what type of content your audience prefers and/or responds to.
In addition to the content of your email, personalization can also have a profound impact on building customer relationships. However, few companies make the effort to personalize emails, even when a prospect specifically requests a communication from a company. Silverpop’s study found that 75% of retailers do not respond to prospects’ requests with even simple personalization like the recipient’s name. In a traditional sales setting where a salesperson meets with a prospect directly, it is important for that salesperson to build rapport and confidence in the prospect by using such techniques as repeating the prospects name. E-mail communication can and should be the same way. Personalizing e-mail can be your company’s virtual handshake to a prospect. Along with Silverpop’s findings, recent studies by JupiterResearch have shown that response rates increase when even simple personalization is used.
While e-mail is not as effective when used purely as a prospecting tool, it can be very effective at building customer relationships and driving sales over the long term. According to BtoB magazine, “when properly used, e-mail can balance low costs and high response rates better than other marketing media. But, the challenge is to maximize its effectiveness through improved content, targeting and tracking.” By following some simple guidelines, you can create a successful email campaign. Your customers are looking for prime rib; don’t make them settle for spam.
The Rise of the Adobe Empire
Originally Published: May 2005
Most of you are aware that Adobe agreed to acquire Macromedia on April 18, 2005. The stunning announcement sent shockwaves through the tech industry – two long-time rivals now joining forces to form a very dominate software team. Many in the industry have speculated on the outcome of the acquisition, but everyone agrees that the new Adobe empire will offer the most powerful, integrated creative suite available and will dominate desktop publishing.
Abobe stated that by acquiring Macromedia, they now have an “industry-defining technology platform that delivers compelling, rich content and applications across a wide range of devices and operating systems.” The company also stated, “The combination of Adobe and Macromedia will provide customers a more powerful set of solutions for creating, managing and delivering compelling content and experiences across multiple operating systems, devices and media. Together, the two companies will meet a wider set of customer needs and have a significantly greater opportunity to grow into new markets, particularly in the mobile and enterprise segments.” Basically, Adobe argues that one combined company will be stronger than the two on their own, and that they will be able to harness the strengths of each company and dominate the marketplace.
Adobe currently produces the following popular products: Photoshop, Illustrator, InDesign, GoLive, Acrobat and PageMaker, while popular Macromedia products include Flash, Dreamweaver, Fireworks, FreeHand, Director/Shockwave and ColdFusion. These are some of the biggest names in software and now they play for the same team. Because Adobe and Macromedia were in direct competition before the merger, they have a good deal of product line overlap. For example, Macromedia's Freehand directly competes with Adobe's Illustrator while Macromedia's Fireworks competes with Adobe's Photoshop. This means that some applications will be jettisoned in an effort to streamline the new company. The good news for Adobe is that the transition will be easier because the two companies have definite strengths and weaknesses when their products are compared to each other. For example, Macromedia’s strengths lie in its web development applications and graphical user interfaces such as Flash and Dreamweaver, while Adobe’s strengths lie in its graphic design capabilities, such as Photoshop and Illustrator, as well as the company’s popular Acrobat. As such, Adobe will likely combine the product lines of each of the two companies that complement each other, while discontinuing weaker titles.
The most interesting aspect of this acquisition is speculating on the shape of Adobe’s new product line. Because of the complementary and competing aspects of the products lines, some products will merge, some will remain the same and some will disappear altogether. But, the most attractive aspect of Macromedia’s acquisition is Adobe’s access to Flash, and the promise that a future Acrobat version will include some if not all aspects of Flash. There is even the possibility of Acrobat and Flash Player merging into one universal plug-in. Adobe’s Creative Suite may get a major facelift, and a future premium Adobe Creative Suite may look something like this:
- Photoshop with Fireworks
- InDesign
- Illustrator
- Dreamweaver
- Flash
- Acrobat with Flash
- Director
While this is purely speculation, there are many people salivating at the thought of such a complete suite of products. The only downside might be the price tag for such a suite. In addition to the products in my proposed suite, Macromedia's web development titles like Contribute, Authorware and ColdFusion (which has a strong following) will likely be retained by Adobe, as there are no challengers to these products in Adobe’s current software lineup.
While the acquisition will make Adobe a powerhouse and could potentially make purchasers of a hyper-suite of products very happy, there is one major downside to the acquisition. Adobe has basically erased its competition. Adobe acquired its closest and fiercest rival – good for the company, potentially bad for consumers. As Microsoft has received harsh criticism for its Office Suite and Internet Explorer domination, Adobe could face the same criticism if it acts like a company with no competition and/or routinely crushes competitors. People fear that Adobe will raise its prices exponentially and possibly become stagnant in its research and development – sitting fat and happy on its new throne. Adobe could potentially set any price it wants for its new suite of products, and with the lack of competition, people would have to buy. The chances of these fears becoming reality are somewhat slim, but the potential is definitely there.
While everyone agrees that Adobe’s purchase of Macromedia is very big news, the impact on the consumer is still very much up in the air. The combined product line could potentially be very convenient, but it could also come with a very big price tag. And of course, many are worried that the new Adobe will take advantage of its new dominate position. If this happens, will it take the “Firefox” of creative suites to keep Adobe from acting like the king of the castle?
Most of you are aware that Adobe agreed to acquire Macromedia on April 18, 2005. The stunning announcement sent shockwaves through the tech industry – two long-time rivals now joining forces to form a very dominate software team. Many in the industry have speculated on the outcome of the acquisition, but everyone agrees that the new Adobe empire will offer the most powerful, integrated creative suite available and will dominate desktop publishing.
Abobe stated that by acquiring Macromedia, they now have an “industry-defining technology platform that delivers compelling, rich content and applications across a wide range of devices and operating systems.” The company also stated, “The combination of Adobe and Macromedia will provide customers a more powerful set of solutions for creating, managing and delivering compelling content and experiences across multiple operating systems, devices and media. Together, the two companies will meet a wider set of customer needs and have a significantly greater opportunity to grow into new markets, particularly in the mobile and enterprise segments.” Basically, Adobe argues that one combined company will be stronger than the two on their own, and that they will be able to harness the strengths of each company and dominate the marketplace.
Adobe currently produces the following popular products: Photoshop, Illustrator, InDesign, GoLive, Acrobat and PageMaker, while popular Macromedia products include Flash, Dreamweaver, Fireworks, FreeHand, Director/Shockwave and ColdFusion. These are some of the biggest names in software and now they play for the same team. Because Adobe and Macromedia were in direct competition before the merger, they have a good deal of product line overlap. For example, Macromedia's Freehand directly competes with Adobe's Illustrator while Macromedia's Fireworks competes with Adobe's Photoshop. This means that some applications will be jettisoned in an effort to streamline the new company. The good news for Adobe is that the transition will be easier because the two companies have definite strengths and weaknesses when their products are compared to each other. For example, Macromedia’s strengths lie in its web development applications and graphical user interfaces such as Flash and Dreamweaver, while Adobe’s strengths lie in its graphic design capabilities, such as Photoshop and Illustrator, as well as the company’s popular Acrobat. As such, Adobe will likely combine the product lines of each of the two companies that complement each other, while discontinuing weaker titles.
The most interesting aspect of this acquisition is speculating on the shape of Adobe’s new product line. Because of the complementary and competing aspects of the products lines, some products will merge, some will remain the same and some will disappear altogether. But, the most attractive aspect of Macromedia’s acquisition is Adobe’s access to Flash, and the promise that a future Acrobat version will include some if not all aspects of Flash. There is even the possibility of Acrobat and Flash Player merging into one universal plug-in. Adobe’s Creative Suite may get a major facelift, and a future premium Adobe Creative Suite may look something like this:
- Photoshop with Fireworks
- InDesign
- Illustrator
- Dreamweaver
- Flash
- Acrobat with Flash
- Director
While this is purely speculation, there are many people salivating at the thought of such a complete suite of products. The only downside might be the price tag for such a suite. In addition to the products in my proposed suite, Macromedia's web development titles like Contribute, Authorware and ColdFusion (which has a strong following) will likely be retained by Adobe, as there are no challengers to these products in Adobe’s current software lineup.
While the acquisition will make Adobe a powerhouse and could potentially make purchasers of a hyper-suite of products very happy, there is one major downside to the acquisition. Adobe has basically erased its competition. Adobe acquired its closest and fiercest rival – good for the company, potentially bad for consumers. As Microsoft has received harsh criticism for its Office Suite and Internet Explorer domination, Adobe could face the same criticism if it acts like a company with no competition and/or routinely crushes competitors. People fear that Adobe will raise its prices exponentially and possibly become stagnant in its research and development – sitting fat and happy on its new throne. Adobe could potentially set any price it wants for its new suite of products, and with the lack of competition, people would have to buy. The chances of these fears becoming reality are somewhat slim, but the potential is definitely there.
While everyone agrees that Adobe’s purchase of Macromedia is very big news, the impact on the consumer is still very much up in the air. The combined product line could potentially be very convenient, but it could also come with a very big price tag. And of course, many are worried that the new Adobe will take advantage of its new dominate position. If this happens, will it take the “Firefox” of creative suites to keep Adobe from acting like the king of the castle?
Friday, January 05, 2007
Multi-Channel Marketing Flexes Its Muscle
Originally Published: February 2005
Multi-channel marketing, or cross-channel selling, is the act of promoting sales via a website, mail order catalog and brick and mortar store all at the same time. In our increasingly fast-paced world, multi-channel marketing has established a strong foothold by offering consumers multiple touch points. Not only does this type of marketing offer consumers more options on where to purchase products, but it also offers consumers access to multiple outlets or resources from which they can gather purchase decision-making information. But most of all, it enhances convenience – consumers can gather information, shop for the best deal and purchase when and where they choose.
A recent study conducted by DoubleClick reports that 57% of multi-channel shoppers browse in one channel and buy in another rather than browsing and buying in one channel. While a study by ForeSee Results and FGI Research showed that 86% of multi-channel shoppers still make their purchase in a traditional brick and mortar store, the study showed that before making the in-store purchase, 38% (83.4 million U.S. consumers according to eMarketer) conducted online research before buying. This percentage was nearly the same as the 41% who researched products in a store before buying in the same or different store. Of those that conduct online research prior to making a brick and mortar store purchase, 46% used a search engine as the starting point for their online search, while 39% navigated directly to a retail website to begin their research according to ForeSee Results and FGI Research.
According to the DoubleClick survey that revealed 57% of consumers browse one sales channel and then purchase in another, the largest percentage of shoppers researched online and then purchased in a brick and mortar store. The second highest percentage was consumers who shopped a catalog and then bought in a store. Following up next were consumers who browsed a store and then bought online and those that shopped a catalog and then purchased online. The percentages look like this:
- 43% researched online before making an in-store purchase
- 19% researched a catalog before making an in-store purchase
- 16% browsed a store and then bought online
- 11% researched a catalog and then bought online
At the late January 2005 Christian Booksellers Association (CBA) expo, the Association revealed the results of a recent CBA survey. The survey revealed that, on average, bookseller sales increased four-fold when customers were offered a brick and mortar store, website and catalog combination. Bruce Anderson, an attendee at the conference who operates a store, website and catalog, backed up the benefits of multi-channel marketing by stating that every month in which he mails a sales catalog, his in-store sales increase by an average of 40% for that month.
As more companies offer consumers access to a greater array of outlets for gathering information and making purchases, customers are responding by increasing their purchasing volume. It is not uncommon for a consumer to receive a catalog in the mail, find a product they like, visit the company website for more information, search for product reviews at a third party website and then find the best deal and make the purchase at the original or yet another retail website. It is much easier to switch from one website to another than it is to drive across a city to shop different retail stores or search through twenty catalogs trying to compare prices. On the other hand, the consumer may wish to touch and feel the product before purchasing, and thus will take the information mined online and visit various retail brick and mortar stores to find the best price and make the purchase.
In the age of finicky, time-crunched shoppers, it is important to get as much decision-making information in their hands as quickly and easily as possible. As such, companies need to develop multiple sales channels to make it easier for customers to research and purchase their products. Technology has opened up a host of information opportunities for consumers, and they are taking full advantage. They are rewarding those companies that invest in technology innovations that save the consumer time and effort in acquiring purchase decision-making information, as well as providing alternative sales channels. The reward comes in the form of increased sales. It is also important to invest in building a strong brand to help resist the temptation of consumers to switch to a different brand, surf to a different website or select another brick and mortar store. A strong brand helps insulate you against the competition while technology-driven information resources and multiple sales channels grease the skids to increase sales volume. Are you effectively using technology to provide multiple information and sales channels to keep your products in front of potential customers and capture your fair share of their purchasing dollar?
Multi-channel marketing, or cross-channel selling, is the act of promoting sales via a website, mail order catalog and brick and mortar store all at the same time. In our increasingly fast-paced world, multi-channel marketing has established a strong foothold by offering consumers multiple touch points. Not only does this type of marketing offer consumers more options on where to purchase products, but it also offers consumers access to multiple outlets or resources from which they can gather purchase decision-making information. But most of all, it enhances convenience – consumers can gather information, shop for the best deal and purchase when and where they choose.
A recent study conducted by DoubleClick reports that 57% of multi-channel shoppers browse in one channel and buy in another rather than browsing and buying in one channel. While a study by ForeSee Results and FGI Research showed that 86% of multi-channel shoppers still make their purchase in a traditional brick and mortar store, the study showed that before making the in-store purchase, 38% (83.4 million U.S. consumers according to eMarketer) conducted online research before buying. This percentage was nearly the same as the 41% who researched products in a store before buying in the same or different store. Of those that conduct online research prior to making a brick and mortar store purchase, 46% used a search engine as the starting point for their online search, while 39% navigated directly to a retail website to begin their research according to ForeSee Results and FGI Research.
According to the DoubleClick survey that revealed 57% of consumers browse one sales channel and then purchase in another, the largest percentage of shoppers researched online and then purchased in a brick and mortar store. The second highest percentage was consumers who shopped a catalog and then bought in a store. Following up next were consumers who browsed a store and then bought online and those that shopped a catalog and then purchased online. The percentages look like this:
- 43% researched online before making an in-store purchase
- 19% researched a catalog before making an in-store purchase
- 16% browsed a store and then bought online
- 11% researched a catalog and then bought online
At the late January 2005 Christian Booksellers Association (CBA) expo, the Association revealed the results of a recent CBA survey. The survey revealed that, on average, bookseller sales increased four-fold when customers were offered a brick and mortar store, website and catalog combination. Bruce Anderson, an attendee at the conference who operates a store, website and catalog, backed up the benefits of multi-channel marketing by stating that every month in which he mails a sales catalog, his in-store sales increase by an average of 40% for that month.
As more companies offer consumers access to a greater array of outlets for gathering information and making purchases, customers are responding by increasing their purchasing volume. It is not uncommon for a consumer to receive a catalog in the mail, find a product they like, visit the company website for more information, search for product reviews at a third party website and then find the best deal and make the purchase at the original or yet another retail website. It is much easier to switch from one website to another than it is to drive across a city to shop different retail stores or search through twenty catalogs trying to compare prices. On the other hand, the consumer may wish to touch and feel the product before purchasing, and thus will take the information mined online and visit various retail brick and mortar stores to find the best price and make the purchase.
In the age of finicky, time-crunched shoppers, it is important to get as much decision-making information in their hands as quickly and easily as possible. As such, companies need to develop multiple sales channels to make it easier for customers to research and purchase their products. Technology has opened up a host of information opportunities for consumers, and they are taking full advantage. They are rewarding those companies that invest in technology innovations that save the consumer time and effort in acquiring purchase decision-making information, as well as providing alternative sales channels. The reward comes in the form of increased sales. It is also important to invest in building a strong brand to help resist the temptation of consumers to switch to a different brand, surf to a different website or select another brick and mortar store. A strong brand helps insulate you against the competition while technology-driven information resources and multiple sales channels grease the skids to increase sales volume. Are you effectively using technology to provide multiple information and sales channels to keep your products in front of potential customers and capture your fair share of their purchasing dollar?
Skirting the Line on Privacy
Originally Published: January 2005
Every year, marketers seek to improve return on investment. Battling against greater budgetary pressures, marketers continually seek more efficient targeting methods. The goal is to hit the right prospect with the right message at the right time – a marketing “perfect storm”. The trouble is this perfect storm is growing more and more difficult to achieve as traditional mass marketing becomes less and less effective. One of the newer marketing methods used to counteract this decline in effectiveness is behavioral marketing – delivering marketing messages to prospects based on recent behavior.
Early on, behavioral marketing was the promise of the Internet. These early online marketers claimed that the Internet would finally be the answer to one-to-one marketing – the idea of delivering a sales message to a targeted individual quickly and inexpensively. However, until recently, behavioral marketing was put on the back burner as the dot com bubble burst and advances in technology slowed. But over the last couple of years, behavioral marketing has seen a resurgence due to an increase in online ad spending, a greater number of traditional marketers allocating more of their budgets to online media, technical improvements that enable massive targeted advertising campaigns and the rise of contextual and paid search engine advertising.
Contextual and paid search advertising is the display of ads based on a set of keywords typed into a search engine. If someone enters “Bengals Jersey” into a search engine, a list of websites are displayed that feature Bengals’ jerseys. Along with the list of websites featuring the keyword, most search engines display “sponsored” or “paid” ads at the top and/or side of the page that are related to that particular keyword or phrase. On the other hand, behavioral marketing can go much further by monitoring your actions on a single site, on a network of sites or some programs track all web surfing with desktop adware/spyware software. The information gleaned from this monitoring gives marketers the ability to target prospective customers in real time.
For illustration purposes, let’s say the Ford website tracks visitors’ actions for the purpose of behavioral marketing. They can tell how often you visit the site, how long you visit certain pages and even predict what color of car you like most. With this and the many other pieces of information that can be gathered, marketers can fairly accurately calculate where you are in the purchase cycle. Say you have visited the Ford site twice in the last week, always visiting the Mustang page, clicking on “Build your mustang”, always building a black GT model and on your second visit, you clicked through to the financing page to check the day’s interest rates. This type of data gives marketers the instant impression that you are in the market to buy a black Ford Mustang GT in the very near future. As you click to leave the financing page, Ford, knowing your behavior and estimating that you are close to making a purchase, sends you an ad stating that if you purchase the Mustang today they will knock one percent off a five-year loan. This may just be enough incentive to drive you to action or to help you choose the Mustang over alternative options. Marketers understand the enormous advantage that this type of information yields. Moreover, when you compare this form of advertising to a commercial on broadcast television, you can see how the rate of return would be exponentially greater since you are communicating directly with a self-proclaimed buyer rather than shot gunning a message to millions of people hoping to find a possible buyer.
However, privacy concerns have begun to overshadow the benefits of some of the more intrusive forms of behavioral marketing. Some of the privacy concerns include: how much data is being collected, what sort of data is collected, is the data tied in any way to personally identifiable information, how the information will be used, who will control the information and will the visitor have the option to turn off the tracking. A recent study conducted by BURST! Media showed that only 23% of Internet users would welcome a website’s collection of non-personally identifiable information for the purpose of delivering ads that were more relevant to their interests. A major concern of many consumers is the collection of personally identifiable information. Most people are very uncomfortable if they even have an inkling that behavioral data is being collected and fear data falling into the wrong hands, allowing criminals to quickly and easily steal their identity.
Consumers’ privacy concerns do not end with website tracking either, as technological advancements in other areas of our society allow marketers to track our behaviors without our knowledge. Many retailers have begun using “Video Mining”, the use of video monitoring in retail stores in order to analyze who shops in the store, traffic patterns, what items draw shoppers’ attention, etc. For retailers, this information is priceless for determining where to place certain items, what items to keep in stock, how to display merchandise to attract the most attention and many other pieces of information that yield greater sales. However, like online behavioral marketing, consumers are showing resistance to “Video Mining” as they feel the technique infringes on their right to privacy. Adding to this resistance is the fact that many retailers do not disclose that shoppers are being video taped. Marketers stand by the lack of disclosure by saying that disclosure will cause shoppers to act less natural, altering their regular shopping habits and skewing the results of the mining.
While behavioral marketing has become a very effective tool for delivering highly targeted advertising messages, there is much concern when it comes to privacy issues. Consumer advocates argue that marketers should not collect any data on actual behaviors without the individual’s consent, while marketers continually strive to gather more and more accurate information in an effort to fine tune advertising messages and improve the cost-effectiveness of delivery methods. This fine line between consumer privacy and behavioral marketing has already been crossed when it comes to adware/spyware. Many legitimate marketers have taken great strides to distance themselves from those that install damaging adware/spyware on consumers’ desktops without their knowledge. Yet, many marketers would love to have the data that these programs collect. Therein lies the debate. How much data should marketers be able to mine, while protecting the privacy of consumers? Where do you draw the line?
Every year, marketers seek to improve return on investment. Battling against greater budgetary pressures, marketers continually seek more efficient targeting methods. The goal is to hit the right prospect with the right message at the right time – a marketing “perfect storm”. The trouble is this perfect storm is growing more and more difficult to achieve as traditional mass marketing becomes less and less effective. One of the newer marketing methods used to counteract this decline in effectiveness is behavioral marketing – delivering marketing messages to prospects based on recent behavior.
Early on, behavioral marketing was the promise of the Internet. These early online marketers claimed that the Internet would finally be the answer to one-to-one marketing – the idea of delivering a sales message to a targeted individual quickly and inexpensively. However, until recently, behavioral marketing was put on the back burner as the dot com bubble burst and advances in technology slowed. But over the last couple of years, behavioral marketing has seen a resurgence due to an increase in online ad spending, a greater number of traditional marketers allocating more of their budgets to online media, technical improvements that enable massive targeted advertising campaigns and the rise of contextual and paid search engine advertising.
Contextual and paid search advertising is the display of ads based on a set of keywords typed into a search engine. If someone enters “Bengals Jersey” into a search engine, a list of websites are displayed that feature Bengals’ jerseys. Along with the list of websites featuring the keyword, most search engines display “sponsored” or “paid” ads at the top and/or side of the page that are related to that particular keyword or phrase. On the other hand, behavioral marketing can go much further by monitoring your actions on a single site, on a network of sites or some programs track all web surfing with desktop adware/spyware software. The information gleaned from this monitoring gives marketers the ability to target prospective customers in real time.
For illustration purposes, let’s say the Ford website tracks visitors’ actions for the purpose of behavioral marketing. They can tell how often you visit the site, how long you visit certain pages and even predict what color of car you like most. With this and the many other pieces of information that can be gathered, marketers can fairly accurately calculate where you are in the purchase cycle. Say you have visited the Ford site twice in the last week, always visiting the Mustang page, clicking on “Build your mustang”, always building a black GT model and on your second visit, you clicked through to the financing page to check the day’s interest rates. This type of data gives marketers the instant impression that you are in the market to buy a black Ford Mustang GT in the very near future. As you click to leave the financing page, Ford, knowing your behavior and estimating that you are close to making a purchase, sends you an ad stating that if you purchase the Mustang today they will knock one percent off a five-year loan. This may just be enough incentive to drive you to action or to help you choose the Mustang over alternative options. Marketers understand the enormous advantage that this type of information yields. Moreover, when you compare this form of advertising to a commercial on broadcast television, you can see how the rate of return would be exponentially greater since you are communicating directly with a self-proclaimed buyer rather than shot gunning a message to millions of people hoping to find a possible buyer.
However, privacy concerns have begun to overshadow the benefits of some of the more intrusive forms of behavioral marketing. Some of the privacy concerns include: how much data is being collected, what sort of data is collected, is the data tied in any way to personally identifiable information, how the information will be used, who will control the information and will the visitor have the option to turn off the tracking. A recent study conducted by BURST! Media showed that only 23% of Internet users would welcome a website’s collection of non-personally identifiable information for the purpose of delivering ads that were more relevant to their interests. A major concern of many consumers is the collection of personally identifiable information. Most people are very uncomfortable if they even have an inkling that behavioral data is being collected and fear data falling into the wrong hands, allowing criminals to quickly and easily steal their identity.
Consumers’ privacy concerns do not end with website tracking either, as technological advancements in other areas of our society allow marketers to track our behaviors without our knowledge. Many retailers have begun using “Video Mining”, the use of video monitoring in retail stores in order to analyze who shops in the store, traffic patterns, what items draw shoppers’ attention, etc. For retailers, this information is priceless for determining where to place certain items, what items to keep in stock, how to display merchandise to attract the most attention and many other pieces of information that yield greater sales. However, like online behavioral marketing, consumers are showing resistance to “Video Mining” as they feel the technique infringes on their right to privacy. Adding to this resistance is the fact that many retailers do not disclose that shoppers are being video taped. Marketers stand by the lack of disclosure by saying that disclosure will cause shoppers to act less natural, altering their regular shopping habits and skewing the results of the mining.
While behavioral marketing has become a very effective tool for delivering highly targeted advertising messages, there is much concern when it comes to privacy issues. Consumer advocates argue that marketers should not collect any data on actual behaviors without the individual’s consent, while marketers continually strive to gather more and more accurate information in an effort to fine tune advertising messages and improve the cost-effectiveness of delivery methods. This fine line between consumer privacy and behavioral marketing has already been crossed when it comes to adware/spyware. Many legitimate marketers have taken great strides to distance themselves from those that install damaging adware/spyware on consumers’ desktops without their knowledge. Yet, many marketers would love to have the data that these programs collect. Therein lies the debate. How much data should marketers be able to mine, while protecting the privacy of consumers? Where do you draw the line?
Firefox Hits the Ground Running
Originally Published: November 2004
Mozilla’s new stand-alone web browser, Firefox 1.0, has quickly stormed the web browser market. The open source browser is now posing a stiff challenge to Microsoft’s market leading Internet Explorer (IE). Since its release, Firefox has been downloaded over six million times, and according to OneStat.com, a Web traffic measurement service, Firefox now corners 7.4% of the browser market. While, this seems like a blip on the screen, many believe Firefox is posing a major challenge to Microsoft.
Firefox’s most important feature is its more stringent security features. The browser does not load ActiveX controls, so threatening spyware cannot get to your computer, and there are additional tools that help maintain privacy. Because Firefox is a stand-alone browser and not closely integrated with your computer’s operating system, it is naturally more secure than IE. In addition to greater security, many believe Firefox renders code and CSS much better than IE.
There are also many other features that make Firefox an attractive option, including:
Extensions
Firefox’s built in extensions menu allows you to quickly and easily customize your browser. You can add and remove extensions at will, opening up features that IE users only dream about.
Web Developer Extension
The easily downloadable Web Developer Extension puts many important tools at your fingertips, including the ability to instantly change screen resolution; the ability to turn images, image animations, CSS, Java and JavaScript on and off; the ability to add style sheets; and the ability to change GET to POST and vice-versa. All of these tools lead to more efficient web development.
Mouse Gestures Extension
The Mouse Gestures Extension allows you to control web surfing with a stroke of your mouse. With this extension, you can go back a page by simply right clicking the mouse and moving the mouse to the left. Other features include moving forward a page, minimizing the browser window and even closing the browser by right clicking and moving the mouse down and then to the right in one movement. Once you get the hang of using this extension, you will wish it were available in the Office Suite.
Tabbed Browsing
One of the most convenient features of Firefox is tabbed browsing. For those of us that constantly surf the web, this feature saves valuable time. As you click on a link, hold down the control key and instead of going directly to the page you clicked on, a tab appears at the top of the browser when the page opens. By simply clicking on any of the tabs across the top of the page, you can surf back and forth between multiple pages. You no longer have to click back and forth between multiple browser windows.
Bookmark Transfer and Live Bookmarks
If you have been using IE for years, you may be hesitant to start using a new browser. One reason for hesitation is set up. Firefox eliminates the time consuming problem of transferring bookmarks by automatically transferring them for you, including folders and bookmark names. Don’t worry; they will still be in IE when you want to use that browser. Along with bookmark transfer comes live bookmarks, which allow you to view the latest news headlines without surfing to the actual site. Simply click the headline of any story you want to read, and you will be taken to the text of the story.
The Firefox web browser has made a quick splash due to its many features, most notably the fact that it is open source, which allows the code to be a living document, being constantly updated and improved upon. The stability, security and code rending ability are making it a huge hit with developers and common users alike. Microsoft will surely challenge Firefox, and rumors are already floating around about IE incorporating many of Firefox’s features in its next version. However, the next version is still quite a way from being released, and Firefox will have time to capture quite a bit more than its current 7.4% market share. There is nothing to lose by downloading Firefox; it will make you a much happier – and safer – web surfer. Six million users can’t be wrong.
Mozilla’s new stand-alone web browser, Firefox 1.0, has quickly stormed the web browser market. The open source browser is now posing a stiff challenge to Microsoft’s market leading Internet Explorer (IE). Since its release, Firefox has been downloaded over six million times, and according to OneStat.com, a Web traffic measurement service, Firefox now corners 7.4% of the browser market. While, this seems like a blip on the screen, many believe Firefox is posing a major challenge to Microsoft.
Firefox’s most important feature is its more stringent security features. The browser does not load ActiveX controls, so threatening spyware cannot get to your computer, and there are additional tools that help maintain privacy. Because Firefox is a stand-alone browser and not closely integrated with your computer’s operating system, it is naturally more secure than IE. In addition to greater security, many believe Firefox renders code and CSS much better than IE.
There are also many other features that make Firefox an attractive option, including:
Extensions
Firefox’s built in extensions menu allows you to quickly and easily customize your browser. You can add and remove extensions at will, opening up features that IE users only dream about.
Web Developer Extension
The easily downloadable Web Developer Extension puts many important tools at your fingertips, including the ability to instantly change screen resolution; the ability to turn images, image animations, CSS, Java and JavaScript on and off; the ability to add style sheets; and the ability to change GET to POST and vice-versa. All of these tools lead to more efficient web development.
Mouse Gestures Extension
The Mouse Gestures Extension allows you to control web surfing with a stroke of your mouse. With this extension, you can go back a page by simply right clicking the mouse and moving the mouse to the left. Other features include moving forward a page, minimizing the browser window and even closing the browser by right clicking and moving the mouse down and then to the right in one movement. Once you get the hang of using this extension, you will wish it were available in the Office Suite.
Tabbed Browsing
One of the most convenient features of Firefox is tabbed browsing. For those of us that constantly surf the web, this feature saves valuable time. As you click on a link, hold down the control key and instead of going directly to the page you clicked on, a tab appears at the top of the browser when the page opens. By simply clicking on any of the tabs across the top of the page, you can surf back and forth between multiple pages. You no longer have to click back and forth between multiple browser windows.
Bookmark Transfer and Live Bookmarks
If you have been using IE for years, you may be hesitant to start using a new browser. One reason for hesitation is set up. Firefox eliminates the time consuming problem of transferring bookmarks by automatically transferring them for you, including folders and bookmark names. Don’t worry; they will still be in IE when you want to use that browser. Along with bookmark transfer comes live bookmarks, which allow you to view the latest news headlines without surfing to the actual site. Simply click the headline of any story you want to read, and you will be taken to the text of the story.
The Firefox web browser has made a quick splash due to its many features, most notably the fact that it is open source, which allows the code to be a living document, being constantly updated and improved upon. The stability, security and code rending ability are making it a huge hit with developers and common users alike. Microsoft will surely challenge Firefox, and rumors are already floating around about IE incorporating many of Firefox’s features in its next version. However, the next version is still quite a way from being released, and Firefox will have time to capture quite a bit more than its current 7.4% market share. There is nothing to lose by downloading Firefox; it will make you a much happier – and safer – web surfer. Six million users can’t be wrong.
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