Brand Interactivism

TV Advertising - Less Effective, but More Expensive

Something's gotta give. The traditional 30-second spot is becoming more expensive every year, with record fees being paid during the Super Bowl and American Idol. Yet, TV's reach and effectiveness is decreasing. Was TV such an amazing deal in previous years that it still makes sense nowadays to budget huge sums for television advertising anyway?

According to a survey by the Association of National Advertisers, 78% of advertisers say that TV advertising has become less effective during the past two years. They largely blame video-on-demand and Tivo for this, which obviously has an impact. But so does the fragmentation of television and the Internet. Think "micro"... micro-communities, micro-advertising, etc.

It's just common sense. When there were 3 major broadcast networks, a few local channels, and that was it... well of course mass advertising was going to work. But there will never be a MASH moment again. It's VERY rare that a single event brings the entire nation together (and when it does, it's usually some sort of tragic event during which you wouldn't want to advertise.) There is so much choice now, which is great for consumers but not so great for traditional advertisers.

A new way of thinking is required. And it's starting. The leading edge is jumping on the bandwagon and it's just a matter of time before everyone else starts to catch up.

User-generated online media (all that "Interactivism" stuff we talk about) is growing extremely rapidly. Ad spending on blogs, podcasts and RSS feeds grew nearly 200% from 2004 to 2005 and is projected to grow another 145% in 2006. Research done by PQ Media suggests that the root causes are audience fragmentation, the ineffectiveness of traditional advertising, and the desire to reach the 18 - 34 market. Among the paper’s findings:

• Blog advertising comprised over 81% or $16.6 million of total spending on user-generated online media in 2005, but blog ads will comprise only 40%, or $300.4 million in 2010
• Podcast advertising is rapidly growing. In 2005, such advertising accounted for only $3.1 million in spending but is expected to grow to $327 million by 2010, which would make it larger than blog advertising.
• Spending on RSS advertising is currently tiny ($650,000 in 2005) but is expected to grow to nearly $130 million by 2010.
• Total spending on user-generated online media is forecast to grow at a compound annual rate of 106% from 2005 to 2010, reaching $757 million by then.

How the Internet Fundamentally Changes Communications

Many traditional marketing and advertising agencies (even ones that claim to be "online experts") treat the Internet as just another medium to broadcast a marketing message (the way the SuperBowl was handled certainly proves that!) These agencies see email blasts as a cheaper form of direct mail or banner ads as a somewhat more efficient type of television advertising. And while others recognize that the Internet can help support sophisticated one-to-one relationships with customers through online CRM programs, such efforts are only a good first step. While such programs can certainly be of benefit, the best opportunities on the Internet are fundamentally different from those in traditional media. The traditional worldview limits the possibilities of what can be accomplished.

By its very nature, the Internet is a highly complex system. Extremely small actions can have major consequences online. A single comment on somebody’s blog can spread via syndication technologies like RSS to millions of people within seconds of being posted. This dynamic has helped to make marketers feel unsure in this brave new world. How does a company market itself in a medium where the customers are in control -- where they can easily exchange information about pricing, customer service, or product quality? And where a single negative comment is archived forever to be found by the masses on Google?

Issues like these don’t just apply to corporations. For example, how important is it for a politician to make sure that empowered constituents stay “on message”? How can a not-for-profit organization leverage the Internet in ways to give it influence, visibility and a reach that would have been impossible just a few short years ago?

Emergent online communities form and grow every day, and it is in helping to nurture and empower these communities where opportunities lie for marketers.

An important question for any online marketer is, who controls your message? Success online is rooted in relinquishing control of your message to those you are trying to reach – your customers. Allowing them to speak, rather than speaking down to them, is the first step. Marketers must remember that the Internet is made up of empowered individuals who do not want to be treated as a mass consumer or a demographic. The ease and immediacy of communications from anyone to anyone is what makes the Internet so different from traditional media. Broadcast and narrowcast marketing each implies that the source of the message is in control, but this is not how the Internet works. The organic power of online entities like message boards, chat rooms, blogs, podcasts, RSS, grassroots communities, expert opinion sites, mobile smart mobs, and viral emails change the equation dramatically.

While marketers cannot hope to control the Internet, successful companies work to empower their natural communities to sit up, interact, get involved, take action and tell others.

Individuals respond well to organizations that are perceived as being encouraging and supportive of their communities, and brand loyalty is what results. The desired effect is the exponential power of positive word-of-mouth.

Great Travel Deals Through Syndication

The NYT is reporting on a method of finding the best travel deals online that is gaining in popularity. By taking advantage of syndication tools, travel bargain hunters are able to have, in essence, a customized web page that automatically brings to them the top travel deals, all in one place, from a multitude of sources.

Since the NYT archives its articles, thus removing them from public viewing, after a short period, the most important content is quoted here...

"But those willing to spend a few minutes to create a personalized home page on Yahoo, MSN, Google or other sites now have a useful alternative. Recently, these sites began allowing consumers to populate their home pages with similar information they'd find in e-mail newsletters, with two added benefits: all the relevant information from multiple sites appears on one page, instead of multiple e-mails, and the information is often considerably fresher, with several updates a week - or even a day.

What's more, the most recent information is there whenever you're in the mood to check it, not when your e-mail tells you to."

RSS (the underlying syndication technology) makes it so much easier for your customers to have complete information. Information control was once used by businesses to successfully gain leverage over customers. Now, however, business models that rely on information control are becoming obsolete and ineffective. Customers can route around attempted information fences.