November 12, 2007

Product Placement Keeps Track of Digital

Product Placement will be the only “traditional” marketing tool with comparable growth expectations of digital media beyond 2010 with a CAGR of 20 percent – spurred on by advertisers’ desire to drive relevancy and reach for their advertising as consumer control over interruption advertising continues, according to a startling new report by IBM Global Business Services.

The report entitled The End of Advertising as We Know It, forecasts greater disruption for the advertising industry in the next five years than occurred in the previous fifty, indicates that by 2012, the landscape of the industry will change so profoundly that in order to survive advertising industry players will need to take aggressive steps to innovate in three key areas:
  • Consumers: making micro-segmentation and personalization paramount in marketing;
  • Business models: how and where advertising inventory is sold, the structure and forms of partnerships, revenue models and advertising formats;
  • Business design and infrastructure: All players need to redesign organizational and operating capabilities across the advertising lifecycle to support consumer and business model innovation: consumer analytics, channel planning, buying/selling, creation, delivery and impact reporting.
Nearly half of the advertising survey respondents anticipate a significant (greater than 10%) revenue shift away from the 30-second spot within the next five years, and almost 10 percent of respondents thought there would be a dramatic (greater than 25 percent) shift. Two-thirds of advertising experts surveyed by IBM expect 20 percent of advertising revenue to move from impression-based to impact-based formats within three years.

The bulk of survey respondents acknowledged that consumers have tired of interruption advertising, and are increasingly in control of how they interact, filter, distribute, and consume their content, and associated advertising messages.

The Ad Marketplace

Notably, the report found that self-service advertising exchanges or "marketplaces" are attracting revenues that were once exclusively sold through proprietary channels or transactions. More than half of ad professionals polled by IBM expect that in the next five years open advertising exchanges will take 30 percent of current revenues now commanded by traditional broadcasters and media.

The IBM report shows increasingly empowered consumers, more self-reliant advertisers and ever-evolving technologies are redefining how advertising is sold, created, consumed and tracked. IBM said all players must adapt to a world where advertising inventory is increasingly bought and sold in open exchanges vs. traditional channels.

Traditional advertising players risk major revenue declines as budgets shift rapidly to new, interactive formats, which are expected to grow at nearly five times that of traditional advertising.

Bill Battino, Communications Sector managing partner, IBM Global Business Services said, "companies must re-look at how they serve content to consumers with business models based much more on engaging consumers in a relationship. Digital entertainment is experiencing faster adoption than anyone had previously anticipated. The advertising community needs to dramatically re-orient its business to serve consumers who increasingly access content in non-linear formats," he said.

Finally, a corporate giant speaks frankly to the industry. I'd love to know the voice traffic between New York, London, Sydney and Paris Monday morning.

"Duncan, this is Alan. Did you see that news report Friday?"
"IBM, yeah. F#*#k.

November 07, 2007

Online Video Metrics Matters

In their October report, Web Video Marketing - Best Practices, TubeMogul mentioned that the strength of online video as a marketing medium stems from its engagement potential, SEO value, and measurement opportunities. According to TubeMogul at least fifty percent of the time, creating a great viral video is all about content and production. The goal, “is to create something remarkable, literally, something that causes people to remark - and in doing so effectively conveys your message".

We've been using TubeMogul for months and appreciate having the analytics to pitch our services to potential sponsors, but the really great part is all the time that it saves us not having to visit every video-sharing Website.

Online video is one of the best venues to engage an audience - don't even think about excluding it! This new medium allows the video creator to communicate a message on multiple levels - via visual imagery, the spoken word, music and visual text. It may sound like a commercial for a Montessori school - but this is the way people learn, and consequently, the way legendary brands are created. As a case in point, think of traditional internet marketing; when was the last time that a paid search listing or banner ad raised your blood pressure or induced you to forward something to a friend? Get the point?

The trick, as with any marketing effort, is to both be remarkable AND communicate your message. Use the right package to make your video a hit, but don't create a vehicle without passengers. Make sure the content is doing what it supposed to do.

Bottom line: choose production components that fit with your message, content, and intended audience.

Let's hope the current writers strike in the U.S, which seeks a greater share of revenue from Webisodes, Mobisodes and the like, doesn't fuel the cost of content and in the process slow the move to distribution methods like TubeMogul.