Is internet TV the future?

Developments in broadband technology and online TV, notably the recent success of the BBC’s iplayer, have led to speculation as to whether internet television is the way of the future.

The fact that 3.5 million programs were downloaded from the BBC’s iplayer in the two weeks following its launch in December 2008 suggests that it is. It is also apparent that, despite these figures, there are problems with the technology. However the 800 million free to view online TV shows that were streamed or downloaded worldwide last year show that there is a certainly an audience for online television. The E.U.’s decision to put £10.5 million into creating a platform is a necessity in order to harness the full potential of this technology. 

The difficulties arise in finding platforms that meet user requirements as well as providing advertisers with a way of communicating. The audience fragmentation that is created by online TV’s interactivity means that we are challenged to reach people in new ways.  

Contrary to some beliefs, this does not spell doom for marketers. However it raises a host of questions. How will advertising be measured, traded, and delivered? What does this mean for marketing to viewers? Loss of advertising opportunity due to downloadable television is, on the surface, a problem for advertisers.  

So what does this mean and how does it work? We need to embrace the multi-functionality of the internet, use these emerging mediums and find ways to deliver rich, experiential and emotional interactions to users. This can be the most powerful method of delivery, made uniquely possible by merging the rich content of television with the formidable interactivity of the web. Sites such as Honeyshed.com, which sells DVD’s, fashion, electronics and beauty products, makes use of online TV elements in combination with the user guided power of the internet.

Advertisers need to adjust to an active audience who are able to filter their online space to include only what interests them. If users don’t like something, they don’t watch it or click on it. Advertisers who are able to catch today’s zeitgeist, successfully merging desire, interactivity and functionality, are finding that their pots are overflowing.

The challenge of the future is to establish connectivity between online content and household televisions. This is something that is already being explored by Apple with Apple TV, and for which there is enormous potential in Nintendo’s Wii gaming console, Microsoft’s XBox and Sony’s Playstation 3.

The passion with which users have approached so-called web 2.0 interactivity proves that the consumer’s power to choose is a vital and powerful element for success. Online TV is the future because it delivers what audiences want. This is an evolving framework that caters to niche audiences.

It is clear that we are in the rudimentary stages of what will soon be a form of broadcasting that will easily compete with terrestrial and cable television. Our role in these changes is to come up with ways to reach the new, highly fragmented audiences that this method of delivery creates. It is a challenge to which advertisers must rise, or risk being left behind. 

Justin Drummond,

Chief Executive - Media Corporation plc

Listed on the AIM market of the London Stock Exchange, Media Corp is a leading internet media and advertising group focused on website publishing and online advertising.
 
The Group has two principal divisions:
 
Website Publishing - Media Corp has a diverse publishing division specialising in online media. Our impressive portfolio of websites includes a number of market leading sites including www.gambling.com, www.onthebox.com ,  www.sport.co.uk, www.creditcardexpert.co.uk and www.flightcomparison.co.uk.
 
Online Advertising - Formed in 1996, Eyeconomy specialises in mass reach campaigns to over 30 Million unique consumers per month via its own proprietary ad-serving and tracking technology for clients including AOL, Dell and American Express.
 
www.eyeconomy.co.uk
 
www.mediacorpplc.com 

A Dozen of your Finest Mobile Phones Guv’nor…

I shared some research at a mobile advertising forum yesterday that was attended by digital media planners, insight managers, mobile operators and advertisers.  The legal drugs in the coffee & doughnuts soon kicked in and a discussion about the catalysts necessary to drive mobile advertising forward ensued.

The mobile operators were justifiably implicated. First up, it’s just too bloody expensive - for consumers and for media buyers. Mobile operators must communicate with crystal clarify a simple mobile Internet tariff. How simple? Like, “I-pays-my-money-and-I’m-through-the-door” simple. No ‘usage caps’, no ‘extra megabyte for a quid’, no ‘data bundle’ nonsense; plain, simple access for dummies.

Equal scorn was poured upon the rate cards for mobile display ads. The current £15cpm for simple mobile display was ridiculed. Of course operators claim that their premiums are justified as they offer additional targeting and the unique contextual features of mobile. But Internet advertising is the bench mark – and whether that’s right or wrong – the rate card needs to be what the market will pay. Media owners can scream about the USP of mobile advertising all they want, but £15 CPM is going to kill this business before it even gets started as brands won’t dig into their pockets to trial. Media owners need to get realistic about the brand value of static small banners. Mobile can offer much more ‘after-the-click’ and that’s where the premiums are justified.

The discussion shifted to consumer behavior and it was agreed that, other then early adopters, few consumers see compelling reasons to use the mobile Internet for anything other than brief snacking. But of course the same was said about the fixed internet ten years ago and text messaging in 2000. So I ‘m not doubting that this thing will happen; of course it will – we’ll all be browsing the mobile Internet in no time. But we need to be patient and let consumers discover the unique identify of mobile media first.

But in the end – after much rational discussion – the universal conclusion was that advertiser clients need to use the mobile Internet in their daily lives to get this business moving. Only then will they get it and start demanding it in planning sessions.

I don’t know about you but I’m off to buy a dozen Nokia’s for my customers right now….

Less is more

Spend less time creating communications that are at best rushed, poorly executed, knee-jerk reactions to your competition and more time, effort and money on making those communications relevant and interesting to your customers.

Today hundreds if not thousands of different brands will be shouting at you from every conceivable marketing angle. As if life isn't hectic enough without this stream of messages clamouring for your attention during every waking moment. As we all know, the places in which brands can communicate have grown exponentially over recent years, with the digital revolution and media fragmentation playing a major part in this messaging mayhem.

OK. So against this backdrop, what's the answer for advertisers wanting to get cut-through? Quite simply I believe, less is more. Spend less time creating communications that are at best rushed, poorly executed, knee-jerk reactions to your competition and more time, effort and money on making those communications relevant and interesting to your customers.

I realise this may be controversial but might I suggest that a few more brands (and their managers) sit down with their agencies to cut out 10 planned briefs that really aren't needed this year and then take the combined budgets from those briefs and look into doing something customers actually want? We've already tried this with a number of our clients and it's helping to focus minds and concentrate effort in all the right places.

Is a Microsoft/Yahoo! merger good for the internet?

On 1^st February, Microsoft formally made its pitch to attain all the outstanding shares of Yahoo! for roughly $44.6 billion.  Steve Ballmer, Microsoft’s Chief Executive, stated that the move would enable them to seriously rival Google in the online advertising space which is said to be worth nearly $80 billion by 2010. This is certainly a fascinating time for online business, but is a Microsoft/Yahoo! merger good for the internet?

Ultimately, the answer to this question can only be yes.  Healthy competition is far better than a monopoly and this kind of thinking has to be applied to the online search and advertising industry.  At the moment, Google currently process 56% of all US searches, versus 32% for Microsoft and Yahoo! together (Source: Nielsen) and this cannot be constructive for an effective marketplace.  If Microsoft were to take over, despite their bid being rejected, the joint force of the two would stand a greater chance of loosening Google’s grip on both the search and online advertising industry.

Google’s argument appears to insinuate that Microsoft are trying to take over for reasons untoward.  They ask, “Could Microsoft now attempt to exert the same sort of inappropriate and illegal influence over the Internet that it did with the PC?”  This seems like nervous talk to me.  Google’s supremacy is being threatened and they are shaken.  In addition, they claimed that Microsoft would be getting Yahoo! for a bargain price if Yahoo! had accepted their bid of $44.6 billion on 1^st February.  A price of $31 per share, a sizeable 62% premium above closing price of Yahoo! shares at the end of January, can hardly be considered a bargain price.                                                                                                                 

Another contention opposing the benefit of the merger is the suggestion that there may be fewer acquisition targets for technology companies.  Many tech companies are created with the objective of being bought by one of the three big Internet giants: Google, Microsoft and Yahoo!.  However, if someone has a good business with market share then they will always be a potential acquisition object. Valuation of a company is dependent on the quality of the company and simply cannot be judged by the number of potential buyers.

 It is perhaps true that there may only be two major conduits (Google and Microsoft/Yahoo!) connecting advertisers and online publishers if this fusion were to go ahead.  It also may be postulated that network effects would reinforce a detrimental supremacy of these two.  Yet, not only are network effects a healthy part of media consolidation, but there is only one chief avenue for this at the moment - Google.  A merger of Microsoft and Yahoo! would have a positive effect as the way would be cleared for rival routes to distribute revenue in an active marketplace and greater choice for consumers.  Bill Gates anticipates a change in “the whole way of how you think about search and why it can be tons better than it is today” (Source: Times Online).  If Google are so dedicated to “openness and innovation” (Source:NMK), perhaps they should stop worrying about preserving it online in the face of Microsoft control and look to what seems to be the inevitable future of the internet.   

Just last year, Microsoft were unable to persuade government regulators to stop Google’s merger with ad serving company Double Click for fear that they were unable to contend with them in providing specific forms of online ads. Now the boot is on the other foot.  Google are the ones who are anxious of being toppled off their throne of dominance.  Changes are coming for the online advertising and search industry and nobody can be sure what they will bring.  Nevertheless, it is surely this very uncertainty and potential for growth that provides the daily excitement of business and the innovation that underpins it. 

Justin Drummond,

Chief Executive - Media Corporation plc

Listed on the AIM market of the London Stock Exchange, Media Corp is a leading internet media and advertising group focused on website publishing and online advertising.
 
The Group has two principal divisions:
 
Website Publishing - Media Corp has a diverse publishing division specialising in online media. Our impressive portfolio of websites includes a number of market leading sites including www.gambling.com, www.onthebox.com,  www.sport.co.uk, www.creditcardexpert.co.uk and www.flightcomparison.co.uk.
 
Online Advertising - Formed in 1996, Eyeconomy specialises in mass reach campaigns to over 30 Million unique consumers per month via its own proprietary ad-serving and tracking technology for clients including AOL, Dell and American Express.
 
www.eyeconomy.co.uk
 
www.mediacorpplc.com 

The Rise of the Mobile Creative Team

I remember sitting in a boardroom a few years ago, presenting one of my first examples of mobile marketing creativity to a seasoned marketing director. The objective of the campaign was to promote interest and buzz around a TV programme called 'Flava' on C4, which attracted a youth audience, average age 16, who followed hip hop. The campaign allowed the audience to learn the dance routine to Missy Elliot's single 'One Minute Man'. The audience pulled a simple text message that appeared to be full of hieroglyphic symbols. At least that is how it would appear to any pa(rents). The fact is, each symbol represented more than a character on a mobile handset. We had hired a leading street choreographer to match handset characters to Labanotation, dance notation. Now the audience could unlock the meaning of the symbols by simply logging onto the glossary on the programme's website. Thousands did, despite the 11pm airtime and they learnt Missy Elliot's dance routine within fourteen minutes.

Today I would have flown that marketing director to Times Square, asked her to point my mobile at the Nike ID poster and to begin designing her very own customised pair of trainers, all from the handset. We would then order and collect her new creation before the return flight to London, all thanks to an incredible campaign delivered from Richard Ting's creative team at RG/A. Or I might have invited her to take her kids to the other side of the planet, to Wellington Zoo. Let her see a virtual 3D koala bear come to life as she pointed her mobile's camera lens at a press advertisement for the zoo, the result of a groundbreaking campaign from Derek Handley's talented team at The Hyperfactory.

Common to all these campaigns is a bunch of creative people who not only 'get' mobile technology but know how to match this new media with big ideas and consumer insight. They know that their campaigns will never be beamed into a living room, for their work to land in the highly personal space of a miniscule mobile phone screen, they have to deliver heavily on 'engagement', very differently from any TV creative and they are succeeding. The ideas are now beginning to rise above the novelty of the technology and advertisers and other agencies are taking note. We are witnessing the rise of a new breed of mobile creative team and it is from these ranks that we will see the future stars, of that I am certain.

Stop press! Paid search is the path to fortune

Direct mail can often be a way to get your brand to the attention of journalists but bombarding them with meaningless rubbish isn’t, and it doesn't help if you're trying to lecture them about things they already know.It’s been intriguing over the last week. Sadly I’ve not been the recipient of the usual flurry of Valentine’s gifts, but rather my desk is creaking under fortune cookies.

Yes, you read that right. I have no fewer than six boxes on my desk, all from the one company, Clicks2customers. The first box arrived last week, and steadily the flow has increased. While some people may believe I’m churlish for complaining, let me elaborate. Each cookie has – as with tradition – a message inside. Not one of fortune, but an alert to tell me that paid search is a growing form of online advertising. A fair veteran of digital marketing, that information hardly knocked me down.

The irony is that’s all the cookies told me. Sent out by a ‘communications company’ called Say Communications, the little boxes held some padding, a cookie and, er, that was it. I knew no more.

Until I went online and Googled Click2customers. I got their website, which told me the usual info about what they do. Fair enough. But why were they using up a couple of trees every few days to tell me paid search was a growing form of advertising? I finally Googled Say Communications, and had slightly more luck. It turns out they have won the account for Clicks2Customers, which is a South African company due to launch in the UK.

What’s the point of the cookies? Now, if Fortune Cookie itself had sent them, I could see the point, even if it was fairly obvious. But a South African company, with no obvious link to China? Who knows. But I would suggest if Clicks2Customers is thinking it’s coming to the UK to evangelise about paid search, it should keep the return half of its ticket to South Africa.

What the iPhone's 'Success' Really Means...

I really didn’t want to kick off my first post here by talking about the iPhone – it’s attracted far too much hype already and I don’t want to add fuel to its public relations inferno - in fact I'm pretty sick of hearing about it. But the iPhone 'phenomena' is a harbinger not for more and better iPhones, but for the evolution of the mobile Internet and advertising across it.

The iPhone hype suggests that there is a huge appetite amongst early adopters to get access to their digital stuff on the go. And where the pioneers tread, the masses usually follow. Some of you would argue that millions of people just got caught up in Steve Jobs ‘reality distortion field’; he is a master salesman after all. And some of you would say that the iPod’s success drove the iPhone hype. But it’s more than that.

The success of Mr. Jobs little gadget is due to a fundamental desire to be connected on the go in the most user friendly way possible. User friendliness is of course subjective – some people hate the iPhone’s touch screen – but that’s not the point. Jobs sold us the promise of mobile media like we’ve never seen before and many of us bought into it.

And this desire is driving an army of consumers to seek out their favourite digital brands not just on the iPhone but on every phone - seven million mobile phone customers now use the mobile Internet each month . In years to come, I’ll be staring at the iPhone through a glass case in the Victoria & Albert Museum, smirking at its old technology; but I’ll also remember fondly that it launched around the same time when the mobile advertising industry exploded.