Online Marketing B2Beat

State of the Union, GOP debates, economy and B2B

2012-01-24T12:03:00.004-05:00

Things suck less than before. Housing over-supply and jobless claims dropping. Travel industry improving. Holidays sparked double-digit surge in tablets, e-readers.

Last night’s GOP debate from Tampa was supposed to be about the private sector’s ability to create jobs that Big Government hasn’t been able to generate the past three years. Instead it came down to two rich guys competing to see who paid more taxes on money they may or may not have earned fair and square through actual “work.”

Gingrich compared himself to Reagan, calling himself "exactly the kind of bold, tough leader" that Americans want, "someone who is prepared to be controversial when necessary." Romney cited his record in running the Salt Lake City Olympics and said Gingrich "had to resign in disgrace" as House speaker after an ethics controversy, a characterization Gingrich disputed. Ron Paul and Rick Santorum, when given a chance to get a word in edgewise, showed they’re smart, thoughtful and experienced. They’re probably too intelligent for the average American voter to get and not well enough funded (or well-connected enough) to stay with the leaders till the finish line. Too bad. But’s it’s nice to see common sense and modesty has made it to the Final Four.

In tonight’s State of the Union address, the Prez will undoubtedly point to great strides his administration has made since he took over the train wreck that was the U.S. economy in 2009. There’s certainly been progress, but how much can be attributed to policies put in place vs. how much has come from the natural corrections a free market economy allows. Housing and excessive private debt, the two biggest scourges of the recession, he'll likely say are finally showing signs of improving. Even cantankerous NY Times columnist, Paul Krugman, was upbeat in his NY Times column yesterday “Is Our Economy Healing?”

But you could also argue that the historical rate of home ownership in the U.S. has been about 60 percent of American households. We got near 70 percent just before the housing bubble burst and are still painfully regressing to the historical mean. Should we be fighting the law of averages or setting better home-ownership policies down the road?

In tonight’s address, we’ll surely hear talk about fixing income inequality, but we’re more concerned here about technology inequality. The Holidays sparked a huge gain in U.S. in ownership of tablets, e-readers. And, the Pew Research Center’s Internet & American Life Report released yesterday said the share of adults who owned table computers nearly doubled overnight to 19 percent from 10 percent in November. The boost in tablet ownership was especially high among college educated folks earning over $75K per year. We suspect the rate of cutting edge technology ownership and systems is also tilted in favor of large business vs. small businesses.

Our take: Whether you’re a B2B marketer, business owner or media outlet, you absolutely must take this mobile data into consideration before you get too far down the road with your 2012 strategy. If you don’t have the budget for mobile and related-platforms, find a way to make it fit.

Jobless claims down

The number of people seeking unemployment benefits for the first time plummeted last week to 352,000, the fewest since April 2008, the Labor Department said. But is that real progress or are companies finally realizing they can’t continue to operate indefinitely with staffs stretched too thin, disgruntled and fatigued?

Separately, the government said consumer prices were unchanged last month, the latest sign that inflation remains tame. Lower gasoline prices offset rising costs for food, medical care and housing. The Federal Reserve projects consumer price inflation will fall from about 2.8 percent in 2011 to roughly 1.7 percent this year. That’s progress, but is it enough to spike a surge in demand?

Travel industry bouncing back

The travel and tourism industry has added about 224,000 jobs since reaching its low point in December 2009 according to the US Travel Association. Meanwhile, hotel occupancy reached 59.8 percent in 2011 (projected to hit 61 percent in 2012), up from 54.6 percent in 2009, according to Smith Travel Research. And the Bureau of Transportation Statistics said full-time jobs in the airline industry finally began to improve last year after 28 consecutive months of decline. No one enjoys flying anymore. It’s a cattle call for most budget conscious consumers and a horrific time drain for most business travelers, but people still need to meet and press the flesh to close business and preserve relationships (whether of the business and familial kind).

Conclusion

Whether you’re a glass half-full or glass half-empty type of person, indicators keep showing that more of your favorite beverage is in the glass than when the current Administration took over. We don’t take sides for any political debate, so you’ll have to decide for yourself whether the private sector can keep the small engine of momentum running by itself, or will it need a continuous helping hand from the government? As we’ve said many times before, things are never as bad as they seem when times are lousy—just as they’re never as idyllic as they seem when we’re flush with cash, customers and back orders (or waiting lists) for our services.

If nothing else, now is the time to hit the gas on your marketing, hiring and expansion plans, before the tsunami of pent up demand leaves you in its wake.

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Too Many Gadgets, Too Little Time

2012-01-06T09:15:00.004-05:00

Will 2012 be more volatile than 2011? (take insta-poll). Encouraging economic signs

Do we have gadget fatigue?

According to a new study from Underwriters Laboratories (UL), the nonprofit product testing and certification organization, 48 percent of consumers of 1,200 surveyed consumers—ALMOST HALF—believe high-tech companies bring new products to market faster than people need them. Is the pace of innovation too fast for consumers? Are companies rushing new product out the door just to keep up with their competitors (versus consumer desires). The report found the at U.S. manufacturers value “speed to market” more than any other criteria. In a New York Times interview, UL’s chief strategy officer Sara Greenstein quipped that “innovation is too fast only if corners are cut.”

Apple sold about 40 million iPads in 2011—no surprise there despite being the most expensive offering on the market, by far. But, non-tech manufacturers such as Amazon (Kindle) and Barnes & Noble (Nook) managed to sell 30 million e-book readers in 2011. That’s a 108 percent increase over 2010, according to I.H.S. iSuppli. E-book readers have far fewer features than pure tablets, but analysts say the line is blurring between e-books and tablets. Forrester Research says Amazon (Kindle Fire) and Nook Tablet managed 7 million sales combined in Q4 of 2011.

Our Take: Sales of the hybrids represents a low-cost interim step that could be chalked up to budget-conscious Holiday shoppers as much as to true consumer demand. If you’re designing creative for the on-the-go consumer, focus on pure tablets and mobile devices. Also make sure you don’t confuse “adoption rates” from regular usage rates. For instance, British consulting firm Arieso found that the heaviest one-percent of mobile users account for 50 percent of the world’s traffic and the heaviest 10-percent of users account for 90 percent. Arieso also found that two thirds (64%) of “extreme” users were using a laptop, whereas only one-third were using a smartphone and 3 percent had an iPad.

Why taking a break from our electronic devices is healthy and productive

New York Times columnist Nick Bilton offers good food for thought in his latest rant about technology addiction.

“Our brains often need to become inattentive to figure out complex issues,” according to Jonah Lehrer, a neuroscientist and author of new book “Imagine How Creativity Works. University of California psychology prof, Jonathan Schooler, said daydreaming and boredom seem to be a source for incubation and creative discovery in the brain and are part of the creative incubation process.”

Will 2012 be more volatile than 2011?

Take our InstaPoll and see how your peers feel.

Encouraging signs on the economic front
• Companies added 325,000 workers last month, the highest monthly tally in more than 10 years according to ADP
• The Labor Department said the economy has added 2.4 million jobs since hitting its low point in February 2010
• Weekly applications for unemployment benefits dropped to 372,000—11 percent lower than
this time a year ago the Labor Department said
• Manufacturing companies have added—not cut—jobs for two consecutive years. Before last year, manufacturing haven’t added jobs since 1997 the Department said.
• The number of Americans who signed contracts to buy homes in November rose 7 percent, to
the highest level in 18 months according to the National Association of Realtors.
• Also 12/21 a Thomson Reuters University of Michigan survey of overall consumer sentiments
showed a substantial jump to 69.9 in December from 64.1 (a 9% gain) and The Conference Board’s Leading Economic Index rose to 118 points—it’s seventh consecutive monthly gain.

As Isaac M posted last week on our blog: “I'm a small business owner, running a technology consultancy for schools. Over the past year, my numbers have become significantly better, private and public schools are doing a lot of buying, and America's getting back up on its feet from where I see it!”

Let’s be smart—not blindly optimistic--in 2012 and hope Issac is right.

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End of Year Client Poll

2011-12-22T15:18:00.000-05:00

Tech Marketing Budgets Up for 2012

2011-12-17T12:10:00.003-05:00

Digital, content marketing and lead-generation top priorities. More positive indicators for economic recovery

According to new findings from IDG Research Services, two-thirds of the technology marketers surveyed said they expect their budgets to rise next year with digital programs capturing half the spend. Live events are expected to garner one fourth (24%) of tech marketers’ budgets with the remainder spread among print, broadcast and other media.
Our experience is that tech marketers tend to pave the way for marketers in other industries who have long sales cycles and who need consistent, high-value touch points with multiple decision makers.

What are tech marketers’ goals this year? Lead generation topped all digital budget categories with almost 27 percent, followed by display/banner at just under 20 percent and search at almost 19 percent.

What is the most important campaign metric? Researchers say click-through rate is the most important factor in campaign success with cost-per-engagement and interaction rate almost equal in importance.

Top 5 spending priorities? Content marketing, which includes white papers, case studies, videos, custom websites, video and white papers, is among tech marketers’ top five spending priorities for 2012:

--71 percent will be investing in collateral
--61 percent will be investing in webcasts/virtual events
--59 percent will be investing in videos
--55 percent will be investing in research
--54 percent will be investing in content marketing or custom programs

Our Take? Tech marketers are historically a good bellwether for any mature industry with a long sales cycle. We expect those in financial services, pharmaceutical, legal, insurance and other professional services to follow tech marketers’ lead.

NOTE: When asked about the biggest challenges in producing marketing content, approximately two-thirds of the marketers indicate they will outsource one or more projects involving content creation, creative development, ad unit creation and online production/services.

More signs that modest economic rebound is likely to stick

Here’s some more optimistic news that came across our radar this week:

-- The National Federation of Independent Businesses said its index of
small business attitudes rose in November for third straight month—7 percent more small business plan to expand their payrolls in the next three months, than plan to cut them.

-- The number of workers voluntarily leaving their jobs hit a 2-year high: The Labor Department reported this week that a record 1.9 million workers resigned their jobs in October.

-- Fed policy makers this week said they plan to keep short term interest rates near zero through 2013. Retail sales up for sixth consecutive month and gas prices down or holding steady in most parts of the country

One millionth mobile app just released

Apps shrink the programs that were once available only on a desktop PC and make them usable on smartphones and mobile devices. Experts say the pace of new app development dwarfs every other kind of media—about 15,000 new ways a week to check stock trades, restaurant reviews, sports scores, directions, traffic, videos, articles and shop. Back in 2008 there were less than 10,000 apps available according to Mobilewalla. Five years ago, building an app for a phone meant going through the carrier, dealing with hardware, QA issues and inconsistent user experience. Now there’s a world of more powerful devices, higher quality networks and high-resolution cameras.

Our Take: More and more of your target customers are unchaining themselves from their desks and you better be mobile optimized—not only your creative, but your strategic mindset as well.

Consumers and businesses ARE spending money—they’re just being pickier about how they spend it and with whom they spend it on. Your target customers have never been better armed with purchase information and nothing sells itself anymore. No matter how talented your sales team; you won’t win in the new post-recession landscape without great marketing and customer support to back up your promises.

Happy Holiday from all of us here at HB Publishing & Marketing Company. Looking forward to working with you again in 2012. Let’s make it a great year.

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Be Ready for Surge in Pent Up Demand

2011-12-05T12:34:00.002-05:00

While we’re seeing some encouraging signs on the Euro zone crisis, the U.S. jobless front and the U.S. financial markets, these are fickle indicators which should be taken with a grain of salt. If you’re a business owner, B2B marketer or media owner, we have some more solid signs of optimism for you to sink you teeth into.

Car sales surge

Auto sales in the United States climbed 14 percent in November as lower gas prices and a wider availability of Japanese models helped the industry achieve its highest selling rate in more than two years, automakers and analysts said last week. Chrysler was up 45 percent over November of last year, Ford was up 13 percent and GM 7 percent.

Cyber Monday

Meanwhile, ComScore, reported that online shoppers spent $1.3 billion on Cyber Monday, a 22 percent increase from last year, at that time the biggest online shopping day of the year. IBM Benchmark said online spending had climbed 33 percent. What’s more, a National Retail Federation survey found that 14 percent of shoppers said they would use mobile devices to shop, up from 7 percent last year.

Technology spending for business in midst of fastest transition ever
The International Data Corporation, whose technology analysis and predictions influence a lot of corporate purchases, foresees the creation of a new high-technology industry in the convergence of mobile devices, social networking, and cloud-based computing and data storage. As a result, the company says in a new study, many industry giants will scramble to sustain relevance, and some upstarts will achieve leadership positions or be purchased.

Frank Gens, IDC’s chief analyst, who led the study, said, “The incumbents are facing a huge transition.”

Spending on the new technologies will reach nearly $700 billion, or about 20 percent of the $3.5 trillion in hardware, software, and services spent on information technology worldwide, IDC said. What’s more, researchers said spending on the new technologies is growing six times that of traditional computer servers and personal computers, and by 2020 will be 80 percent industry growth.

If the IDC predictions hold true, the tech industry could be undergoing its fastest-ever transition. Earlier transitions, like the move from mainframe and mini computers to personal computers and client-server technologies, led to the rise of giants like Oracle and Microsoft, and the downfall of older stalwarts, like Digital Equipment Corp. and Wang Laboratories.

This time will be no different, Mr. Gens said, adding: “Hewlett-Packard will be challenged. Microsoft, Intel, SAP, RIM, Oracle, Cisco, Dell – they are all facing the next transition, competing to be around in 2020. At least a third will fade away.”

Mobile devices

Mobile devices, which earlier this year outshipped personal computers worldwide, will in 2012 generate more revenue than PCs for the first time, IDC said. Shipments of mobile devices will outstrip PCs by two to one, and 85 million mobile applications, or apps, will be downloaded. More money will be spent on mobile data networks than on networks tethered by lines.

The rapid transition to mobile, driven by an explosion of tablet computers, will challenge both traditional computer software companies like Microsoft and beneficiaries like Apple, which is seeing the dominance of its iOS operating system challenged by the open source Android operating system developed by Google.
“By 2013 we’ll know who the leaders are,” Mr. Gens said. “Android will be there, iOS will be there – will Windows 8 put Microsoft there? By the end of the year we’ll know if putting a PC operating system onto mobile was a good idea.”

The increasing number of people and machines online will additionally create an explosion of digital data. IDC said that the amount of data stored in 2012 would increase 48 percent from 2011, to 2.7 zetabytes, or 2.7 billion terabytes. By 2015, the firm said, the total will be 8 zetabytes.

Recommended Reading

No matter how old you are or what stage of life you’re in, we’d like to recommend David Brooks’ recent NY Times editorial series Life Reports.

You can draw your own conclusions, of course, but as marketers and innovators, two things really grabbed us. First, when people take stock of their lives, most regret the risks they DIDN’T take, not the ones they did take. Second, you should measure people by the progress they make in their lives, not by the natural talents they possess.

OUR TAKE: Now if the time of year when many of us reflect on where our businesses and personal lives stand relative to where we thought they’d be a year ago. It can be a gut-wrenching exercise. Just remember that no matter how you measure it, make sure you’re using the right metrics to make your assessment. Also, take time to reflect on everything that DID go right, not just things that came up short.

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Giving Thanks for Some Hopeful Signs for Retailers, Jobs, Factory Output and Home Construction

2011-11-25T19:36:00.003-05:00

Don't underestimate the power of a Black Friday shopper

So Americans are getting soft, you say? We’re getting, fat, lazy, unmotivated as the rest of the world passes us by, you say? Well you haven’t seen Americans shop on Black Friday. If there’s one thing we don’t need to outsource it’s the ability to find a deal. Before you choke on that turkey wishbone in laughter, think about how the web is transforming the shopping experience. Consumers have never been better armed with comparative pricing information, specs, sizes, colors and where to find the best deals. Retailers have to keep opening earlier, competing with both online and bricks-and-mortar sellers and motivate their employees to work, longer, harder and faster when they’d normally be home (sleeping) with their families.

OUR TAKE? When properly motivated, Americans can do anything they set their minds to with resourcefulness, determination and stamina—kind of like a nation of small business owners.

Macroeconomic indicators

For the holiday season-to-date, consumers have spent $9.7 billion online -- marking a year-over-year growth rate of 14 percent, according to new comScore data. During the first 20 days of the season -- which began on November 1--daily online spending peaked on Wednesday, Nov. 16, at $688 million, comScore reports.

The number of Americans applying for unemployment benefits fell last week to the lowest level since early April, a sign that layoffs are easing and hiring might pick up--it was the fourth decline in five weeks. Meanwhile, a Commerce Department report said that builders started slightly fewer homes in October, but submitted plans for a wave of apartments, a mixed sign for the struggling housing market.

A rebound in manufacturing could lead to more hiring. Factory output grew in October for the fourth straight month, the Federal Reserve said Wednesday. Production of trucks, electronics and business equipment all rose, and building permits, a gauge of future construction, rose nearly 11 percent. The increase was spurred by a 30 percent increase in apartment permits, which reached its highest level in three years. Need more? Construction starts of single-family homes, which make up about 70 percent of residential home construction, rose nearly 4 percent last month.

While new homes account for just 20 percent of the overall home market, they have an outsize impact on the economy--each home creates an average of three jobs for a year and generates about $90,000 in taxes, according to the National Association of Home Builders.

Online video can boost your business

Still not sure if online video is worth it? Check out these new findings from
comScore.

-- Nearly 80 percent of U.S. Internet users –180million+ people—will view online video over the course of the month

-- The typical Internet viewer watches almost 20 hours of online video per month
--The average online video consumed is a full 5 minutes long
--The most watched videos add value by “teaching viewers something or covering a topic they care about,” says comScore.

What B2B marketers hope to accomplish with social media tools

According to new data from Chief Marketer’s 2011 Social Media Marketing Survey it is:

-- Drive traffic to websites (66%)
-- Generate sales or leads (48%)
-- Address company fans (47%)

Yes, times are tough. But give thanks this time of year that you have the brains, the team, the family support and the resources to figure out ways to get through it. You will. And we’ll all be stronger for it.
Happy Thanksgiving. HB

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Job openings at highest level since August 2008

2011-11-11T17:40:00.003-05:00

‘Quit rate’ at 3-year high and 7 out of 10 employed workers ‘mailing it in’ at best

OK people. It’s over. The recession is officially two years in the rear-view window. Let’s get back to business already. You’re not going to get an official memo from the Government saying it’s safe to start hiring people again, or it's OK to invest in capital improvements you so badly need, or to build out your marketing platform so you can get actual qualified leads.Remember those? What else do you need to make a decision?

But what about the euro zone crisis, you say? Don’t waste your time watching the daily gyrations of the financial markets. Check your portfolio one every three months or so, but don’t use stocks as a proxy for the state of business conditions or the economy. It’s a glorified casino driven by program traders, hedge funds and short-term speculators.

People are working, and more importantly quitting for better jobs

Here’s what’s important: New claims for jobless benefits in the United States fell last week to their lowest level since early April and the country’s trade deficit unexpectedly shrank in September, pointing to a slight improvement in the sluggish economy. More encouraging was a Labor Department report showed a strong increase in the “quit rate” -- the number of people voluntarily leaving their jobs for a new one rose 5 percent in September and hit its highest level since November 2008. It means that workers are finally more confident that they can find new work if they are unhappy with their current positions—a recent Gallup Survey found the 71 percent of U.S. workers are “not engaged” in their jobs or “actively disengaged” form their work.

Greater turnover in the job market now means more opportunities for the 14 million unemployed or under-employed workers seeking to get back into the workforce.

Out Take: Stop focusing on the unemployment rate. It’s stuck like a rusty wheel at 9 percent and doesn’t accurately reflect what companies need to grow and thrive. We think a better measure is the number of job seeker to job openings. That ratio is down to 4.1, from a peak of 6.9 workers per opening in the horrible summer of July 2009.

If you’ve got a job. Now’s the time to find a better one. If you’re looking for work, make sure you don’t settle for the dregs left behind by a former employee burned out by the recession. Find something that matters—and pays you commensurately for your skill. If you have a company, make sure you do whatever it takes to keep your best people happy and by all means, make sure you’re capturing all the knowledge, contacts and processes they have stored in their brains and personal hard drives.

There’s going to be a “brain drain” of epic proportions soon—and you won’t get a memo letting you know when it’s officially started. If you’re not careful, all your organizational “smarts” could go walking out the door on a moment’s notice.

Where smart marketing comes in

That’s also where smart marketing comes in. It’s not just to raise your brand and generate qualified leads—it’s a time-tested way to keep your name in front of the best talent and vendors in your industry. When you cut back on your marketing, you not only choke off your lead funnel and brand awareness. You make yourself conspicuously absent relative to your competitors and lose opportunities to capture great talent. That’s right, think about all the great people who just might have spent one too many late nights at the office without feeling adequately appreciate by their bosses. If you’re not top of mind with them, they’re certainly not top of mind with you.

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Thriving in a SOCIAL ‘Vucu’ Climate for B2B Marketers

2011-11-04T11:21:00.003-04:00

Forget the markets and employment numbers. 10-year forecast might be easier to make than a one-week call

“I could probably make a 10-year forecast easier than a one-week forecast,” quipped Rod Smythe, Chief Investment Strategist of Riverfront Investment Group at a high-end wealth management conference we attended on Tuesday.

Whether it’s the financial markets, the job market, pro sports or even the weather, we’re in an incredibly volatile time and this era of uncertainty is wreaking havoc on our collective psychology. Smart B2B marketers will stay focused on their long-term goals without panicking or chasing the next fad. Just be ready for a lot more VUCU. We’ll get to what vucu means in a minute. In the long run, we’ll get through this and in many respects we’re already there. Say what?

Just two weeks ago, I was swimming in Long Island Sound on an unseasonably warm October day. Stocks were plummeting as the U.S. seemed destined for a double-dip recession and Greece and other Euro Zone players were headed for a sure default on their debt.

How quickly things change. Monday I was trick-or-treating in the snow with my kids here in the Northeast. Stocks are back to break-even for the year and have risen significantly as economic data suggests we’ve fended off the threat of a Euro Zone meltdown, a double-dip recession, and stronger than expected corporate earnings. China’s hyper-growth economy (and inflation risk) slowing and last week’s GDP results showing 2.5 percent annualized growth in Q3, our strongest effort in a year.

So, while personal income is falling, consumer spending has risen at a 2.4 percent annual rate–three times faster than Q3 according to the latest government stats. Despite a persistently high percent unemployment rate, confidence may be returning. Credit card debt is inching higher, sales of cars and major appliances are rebounding and consumers are hording a lot less in their savings accounts (again).

Living in a vucu world

We’re living in a “vucu” world, said Dana Anderson, a Kraft Foods marketing VP who was widely quoted at last week’s Association of National Advertisers conference in Phoenix which attracted a record 1,700 attendees.

Not familiar with Vucu? It stands for volatile, uncertain, complex and ambiguous which is going to require a new set of skills she said. Marketers and advertisers will need learn from experimentation, and be open to intuitive, rather than rational solutions to problems.

OUR TAKE: Amen to that, but much easier said than done. True, tough times call for bold steps and recessions have historically fostered some of the greatest innovations. But, when millions of salaried media workers are scared to death of losing their jobs, the risk of a failure pinned to one’s performance review is a stronger deterrent than usual.

Business spending hot, hiring is not

According to the Commerce Department, business increased their capital investments at a 17.4 percent annual rate. Economists say business spending has been strong throughout the recession, an optimistic sign because investment in factories, offices, equipment and software is often a run up to hiring.

And from a micro-perspective, the office building in which we work was less than half full when we moved in two years ago. It’s 100 percent occupied now. That’s right. No vacancy!

Is technology replacing humans in the workforce?

According to the authors of “Race Against the Machine” a just-released book by Erik Brynjolfsson and Andrew McAfee is a scary deep-dive into the job fallout from advances in technology. The authors, who are directors at the MIT Center for Digital Business, warn that automation has picked up in recent years because of a combination of technologies including robotics, numerically controlled machines, computerized inventory control, voice recognition and online commerce.

Since the “official” end of the recession in mid 2009, payrolls have been flat, but corporate spending on equipment and software has increased 26 percent, they note. According to Factset Research, the productivity gains from technology seem to be falling to the bottom line. The S&P 500 companies are expected to report record profits—nearly $1 trillion--and the corporate profit share of the U.S. economy is at a record high when millions are out of work or facing foreclosure of their homes.

It’s true that hundreds of thousands of sales and marketing jobs have been lost or impacted by technology, but Brynjolfsson and McAfee argue companies still need humans for many higher level tasks requiring intuition, creativity and solutions. Leave narrow, literal minded assigned tasks to the computers they advise and smart humans—including B2B marketers—will learn how to create a “partnership” with technology.

SOCIAL, and we don’t mean Facebook

Marc Benioff, founder of the popular cloud-based sales CRM solution, Salesforce.com, frequently says we’re in the midst of an IT revolution based on the acronym SOCIAL—S is for speed; O is for open; C is for collaboration; I is for individuals who can now instantly reach around the world to network and collaborate; A is for alignment (all your ships moving in the same direction) and L is leadership, both top down and bottom up.

In a New York Times Op-Ed piece, Thomas Friedman, quotes LinkedIn CEO, Jeff Weiner on the power of the IT revolution: “It makes it easier and cheaper for anyone anywhere to be an entrepreneur and have access to all the infrastructure of innovation.”

OUR TAKE: Whether you’re a sole practitioner, a 10-person regional outfit or a Fortune 500 powerhouse, you need to have everyone—and every machine—at your organization aligned and in a nimble entrepreneurial mindset. Make some mistakes. Make ‘em hard and fast and see how quickly you can learn from those mistakes.
That’s how we’ll get out of this economic first gear and great B2B marketing is what’ll get us into the overdrive phase.

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Glimmers of Hope Within Tepid 2012 U.S. Ad Forecast

2011-10-20T16:44:00.003-04:00

Tech spending holding steady despite gloomy economic indicators. Digital now on par with TV. Display and email still working. Is mobile cutting into paid search revenue?

While forecast after forecast comes into our inboxes projecting another humdrum year on the ad spending front, we thought we’d point out a few glimmers of hope.

2012 is a quadrennial Olympic and election year. That means we get plenty of juice from the networks sports media and political campaigns regardless of which media properties you own.

Digital media—which includes online, social and mobile--has approached parity with TV as the most important medium among agency executives, according to the latest quarterly survey from Strata, a media data processing provider. Asked what their No. 1 medium of choice was during the third quarter of 2011, more than one third (34%) of agency executives cited digital, only one point lower than the 35 percent who cited local TV. According to Media Post’s Joe Mandese, that's the closest point of parity in the three years since Strata began querying its agency clients on the dominance of various media in their workflow and budgeting, and represents a 43 percent leap from the second quarter of 2011.

The findings, which are based on a segment of more than 900 agencies. In fact, the survey indicates that digital may be at the tipping point of overtaking all other media in terms of importance, especially if the economy becomes any more unstable. While the third-quarter survey indicated that advertising budgets remain relatively stable and continue to grow overall, the agency respondents said print (52%) and local TV (24%) are the media most likely to take a hit by ad spending cuts.

“The economy is forcing many advertisers to look for more affordable ad avenues--i.e., digital and radio,” said Strata President John Shelton. However, Only 56 percent of the agency execs said they believe their clients “understand the value” in digital, while 44 percent said they don’t see the value.

Corporate profits, spending decoupled from rest of economy

As expected, last week’s post “Financial Markets Decoupled from Economy” got us a lot of attention and some naysayers, but IBM’s strong quarterly profit reported earlier this week gives more credence to our argument. Corporations continue to spend on information technology despite the lousy economy. They’re hording cash and investing in systems, infrastructure and efficiency—not in people—to cut costs and get more productivity out of the headcount they already have in place. The IBM’s of the world sell to big corporate customers, not to Main Street, so that’s why they can report solid profits at a time when the jobless rate is still so painfully high.

Lots of analysts consider IBM a bellwether of IT spending because it’s the largest supplier of computing technology, hardware, software and services to corporations. IBM’s results mirror what we reported to you from Oracle, Salesforce.com and others corporate technology players over the summer.

Our take: In a tough market, there’s always a flight to quality. Smart media owners will find a way to pry that cash out of CMOs’ and their agencies, tightly wadded fists by stressing audience quality, editorial integrity and measurable ROI.

Display advertising shifts from direct response to branding media

Most media buyers and some media owners still think clicks, impressions and conversions are the way to measure performance of online display advertising, but researchers say the more important metrics often point to return on ad spend, online searches for brand names, product recall, and sales.

"The Digital Advertising 2011: A Portrait of Conflict" study released by Collective finds that 57 percent of agencies believe the majority of their display objectives are to build the brand, yet only 11 percent cite ad creative as critical to the campaign's success. Still, three in five (60%) of agencies cite brand recall and intent to purchase as the most important measures of online success. However, clicks and conversions remain the key criteria agencies say they use to evaluate media, according to the Collective study.

OUR TAKE: Through a combination of laziness, arrogance and feeling overwhelmed, agencies tend to fall back on McMetrics, things that are easiest to measure rather than business-building metrics that are harder to measure, but derive real value from a campaign.

Is mobile cutting into paid search ad revenue?

More searches being done on mobile phones where people are less click on ads and the ads cost less. Even mighty Google received 5 percent less for clicks in the second quarter of this year, vs. 2nd quarter last year according to a New York Times report late last week. E-mail remains most popular way to market events. Social media, the least effective.

On average, business use 5.5 different methods to promote their events and email remains the most popular, according to a new eBook released jointly by HubSpot and Constant Contact. More than 70 percent of marketers surveyed by the two aforementioned organizations cited email, followed by word-of-mouth (65%). Social media was deemed least effective.

Just as in a sluggish stock market, there’s always a flight to advertising quality in a tight economy. Savvy marketers and media owners know they have to keep their minds open to new ways of reaching—and measuring—their target consumers, but they should ignore time-tested legacy media such as display, print, broadcast and live events. Those legacy media have been around longer, but they’re still improving at the same rate, if not faster, than some of the new kids on the block.

Resist the urge to go “EITHER/OR” in your media planning process. Just go with a balanced portfolio of media options and make sure you’re always using best in class. Not cheapest in class.

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Financial Markets Decoupled from Economy, Ad Sentiment

2011-10-04T10:25:00.002-04:00

Ad spend continues modest increase thanks to automotive and financial services. Online video most popular on tablet vs. smartphone or social networks

The financial markets have never been a reliable indicator of true economic growth (or lack thereof). They’re a better indicator of investor psychology than they are of underlying corporate earnings or consumer spending intentions and right now uncertainty is trumping confidence. If nothing else, we’re officially in a global economy so when a Euro Zone country gets overextended or when China overheats or plays games with its currency, we all suffer. Hey, our little banking crisis in 2008 wreaked as much havoc overseas as it did at home. Payback’s a bitch.

The markets usually tank in October anyway—check your history books for that month in 2008, 1987, 1929 etc. True, most indices are close to 20 percent off their recent highs in April—a technical bear market signal, but they’re about a percentage point or two off where they were a year ago. We don’t remember things being too rosy last October either.

Right now things are very uncertain, but it doesn’t mean they’re horrible. Housing prices remain depressed, but their holding steady. The jobless rate is way too high for an alleged recover, but slightly improving. U.S. vehicle sales rose almost 10 percent in September to their highest level in five months. More impressive, the Big 3 Detroit automakers significantly outgained Toyota and Honda. Even in our auto-dependent nation, folks aren’t going to shell out tens of thousands for a new vehicle unless they’re pretty sure they can finance the purchase. Perhaps more telling, bank stocks are taking a beating right now but financial services companies are still leading the charge on the ad spending front.

Ad spending up modestly

For the first half of 2011, Nielsen research found that U.S. advertisers overall spent 5 percent more in the first half of 2011 than they did in the first half of 2010 and the categories showing the greatest increase were financially-oriented, said Randall Beard, the global head of advertising solutions for Nielsen. Auto insurance increased 25 percent from first half of 2011, bank services increased 24 percent and financial investment services increased 19 percent. “People are very interested in saving money, getting the best possible deals and making sure their financial situation is as strong as it can be,” Beard told the New York Times in a recent article about his organization’s findings.

Kantar Media’s latest research found that ad spending in major media in the United States in the second quarter rose 2.8 percent from the same period a year ago. The percentage gain was the sixth quarterly increase in a row since the end of 2009, according to Kantar Media data, but it is the smallest of the six. For the first six months of the year, Kantar estimates ad spending was up 3.2 percent from the first half of last year.

The numbers for the second quarter “are painting a mixed picture,” Jon Swallen, senior vice president for research at the Kantar Media North America unit of Kantar Media, said in a statement. On one hand, “a majority of media types actually improved their performance” from the first quarter to the second quarter, Mr. Swallen said. On the other hand, spending growth among the 100 biggest advertisers “stalled” in the second quarter, he added, “and the ad market became more dependent on the comparatively smaller budgets of midsized advertisers as the main source of growth.”

Tracked by media type: Internet advertising was up 10.4 percent and magazines were up 2.9 percent; television, up 1.8 percent; and radio, up 1.4 percent.
Marketers respecting consumers

We popped in last week at the Online Media & Marketing Association conference in New York and were impressed by the attendance levels, the quality of the questions during Q&A sessions and the overall positive buzz and energy despite the gloomy economy. As MediaPost editor Joe Mandese noted, “Marketers are growing up. We came out of an era in which marketers didn’t respect consumers, they just force fed them their messages. Now they have to engage them, earn their trust, before trying to sell them. Is this the dawn of UX (user experience) media planning?”

This week, the 8th annual Advertising Week confab convenes in New York and most of the media pooh bahs expect advertising spending to grow modestly in 2012 and 2013. Tim Jones, CEO of ZenithOptimedia www.zenithoptimedia.com thinks the quadrennial effect of 2012 presidential elections and London Olympic games will give media sellers a lift and Russ Sapienza, senior partner at PricewaterhouseCoopers said most major advertisers still want to sell products in a slow-growth economy. They don’t want to “take [media] money off the table” even when they may put the brakes on major capital investments like factories and infrastructure.

Online display shifting from direct response to branding tool

A number of panelist indicated that the “wow” factor of new ad technology is wearing off and now we’re back to focusing on content—what you actually put inside all those cool ad spaces and time slots. While many media buyers still cling to clicks, impressions and conversions to measure performance. But the more important metrics often point to return on ad spend, online searches for brand names, product recall, and sales.

New research from the online agency Collective indicates that that online display advertising continues to shift from a direct-response form of advertising to branding media.

"The Digital Advertising 2011: A Portrait of Conflict" study released by Collective finds that 57 percent of agencies believe the majority of their display objectives are to build the brand, yet only 11 percent cite ad creative as critical to the campaign's success. Still, three in five (60%) agencies cite brand recall and intent to purchase as the most important measures of online success. However, clicks and conversions remain the key criteria agencies say they use to evaluate media, according to the Collective study.

Want folks to see your Videos? Research says viewers embrace tablets, more than smartphones and social media

A new PwC study finds that consumers increasingly embrace alternative screens to watch TV shows and movies. Nearly three in five surveyed consumers (58%) said they spend more time now viewing movies and TV shows online than they did a year ago. "This was further validated in qualitative discussions, where consumers confirmed that they spend more time using their Internet-connected devices, especially iPads," stated the PwC report. The study emphasized that people considered tablets a "wholly different mobile viewing experience" compared to smartphones, given screen size. Less than one-quarter (23%) had an interest in watching premium video on smartphones. PwC said the lack of enthusiasm for mobile video is consistent with research it has done over the last 18 months.

The research also noted growing interest from a year ago in cloud-based media storage offerings. The idea of a digital locker for music, shows, movies or other content especially appealed to more mature audiences, people in their late-30s to mid-40s, given their understanding of storage technology. Younger people were also intrigued, but had concerns about pricing.

The PwC study found social media was the channel people were least willing to pay extra for to obtain premium content, in part because there's typically no charge for using most social networks. Two-thirds of survey participants said they wouldn't pay anything to watch movies and TV via social properties. But because distribution through social media is still nascent, the consulting firm suggested there is still an opportunity for Hollywood studios and TV networks to leverage Facebook and other social sites.

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Let’s Not Confuse Job Creation With Need to Get Work Done on Cusp of 9/11

2011-09-09T15:46:00.002-04:00

US slips to 5th on world competitiveness scale. Obama jobs plan holds opportunities for marketers

As we tap out this post, U.S. stocks are down about 3 percent today wiping out a brief rally earlier in the week. Experts point to fresh euro-zone sovereign-debt worries, the surprise resignation of an ECB board member and concerns about Obama's jobs plan unveiled on national TV last night. Let’s not confuse “concerns” with “uncertainty” about the plan, which sounded pretty good to us, if you don’t worry about how to pay for it.

At the core of his plan are two cuts in the payroll tax — one for employers and one for employees —The employee cut would reduce the tax to 3.1 percent of income instead of the 4.2 percent negotiated last year. If passed, it will put money in people’s pockets quickly and increase consumer demand. As marketers, you need to be ready to pounce on this.

For employers, the plan would halve the payroll tax for most small and medium-size businesses and would provide an incentive for hiring by temporarily removing the tax for new employees (and on raises for existing ones). Companies would also get a $4,000 tax credit for hiring anyone out of work for more than six months. Unemployment insurance would be extended for five million people. We were also encouraged by proposals to continue unemployment benefits for those legitimately starting new businesses. The dream of a safe steady corporate (or government) job, with benefits and a pension is fast fading into the rearview mirror and not likely to come back.

We’re hoping this crisis gets us back to our entrepreneurial roots and makes it easier for small businesses and independent contractors to be part of the mainstream—not outliers who continue to be treated as second class citizens by lending institutions and healthcare providers. More and more work in our service driven economy is going to be project-based, not permanent and we all need to learn how to hustle.

Again, you need to be ready to pounce on this pent up demand because the surge may not be sustainable, but it will be a surge nonetheless.

U.S. slips to 5th on world competitiveness scale

The United States is slipping and emerging markets are improving, but European economies still dominate the list of the most competitive economies in the world, according to a World Economic Forum report released Wednesday.

For the third consecutive year, Switzerland ranked first in the forum’s annual competitiveness survey, which assesses countries based on 12 categories including innovation, infrastructure and the macroeconomic environment. The US, which topped the list in 2008, continued its decline, also for the third year in a row. The weaker performance was attributed to economic vulnerabilities as well as “some aspects of the United States’ institutional environment,” notably low public trust in politicians and concerns about government inefficiency.

OUR TAKE: Unacceptable--regardless of whether or not you believe in the methodology of the survey.

The results show that while competitiveness in advanced economies has stagnated over recent years, it has improved in many emerging markets, the Geneva-based forum said.
“Much of the developing world is still seeing relatively strong growth, despite some risk of overheating, while most advanced economies continue to experience sluggish recovery, persistent unemployment and financial vulnerability, with no clear horizon for improvement,”
Klaus Schwab, founder and chairman of the forum, said in a statement. China, ranked 26th and up one place from a year earlier, was the highest placed of the large developing economies. Among the other major emerging economies, South Africa was 50th, Brazil 53rd, India 56th and Russia 66th.

The rankings take into account 12 categories: institutions; infrastructure; economic environment; health and primary education; higher education and training; goods market efficiency; labor market efficiency; financial market development; technological readiness; market size; business sophistication; and innovation. The deck should really be stacked in our favor.

What the business gurus suggest

A recent Wall Street Journal CEO Council
roundtable of business leaders had some interesting suggestions for getting America back to work. For your convenience, we stripped the corporate PR spin to serve up some nuggets to ruminate on over this weekend of self-reflection.

No surprise, the CEOs want lower corporate taxes in the U.S., which has among the highest tax corporate tax rates in the world, and a moratorium or a rollback of business regulation.
"The government needs to be a better partner with the business world," said Magellan Health Services CEO Rene Lerer, echoing a sentiment expressed by many.
Yet the CEOs also exhibited a practical streak that is often absent from the Washington debate, and a willingness to embrace compromise. Terry Marks, president and chief executive of The Pantry Inc., which operates convenience stores that sell gasoline, even suggested an increase in the gas tax "to invest in transportation infrastructure."

"We have to confront reality," wrote Roger Wood, chief executive of Dana Holdings Inc., the auto-parts company. "Political infighting and seemingly disparate objectives...are keeping the U.S. from finding real solutions to real problems."

The members of the CEO Council, which includes global companies some of which are domiciled abroad, generally agreed that indebted U.S. consumers can no longer drive economic growth in the U.S., and impetus will need to come from developing countries. As a result, they urged the U.S. to embrace global free trade, and make changes that will encourage the growth of export industries here. Many of their recommendations focused on developing human capital as the key to global competitiveness.

"Create more charter schools and teaching jobs for young graduates," wrote Thomson Reuters CEO Tom Glocer. "Train more engineers and German-quality skilled labor." Several also called for reform of the immigration system, to allow more skilled professionals to live and work in the U.S.

Encouraging innovation in the U.S. was also a common theme

Klaus Kleinfeld, chairman and CEO of Alcoa Inc. called on the U.S. to "reignite innovation" by creating regional alliances that join local governments, universities and investors to spark new business creation, and to invest in "research and development clusters" in areas like clean energy and life sciences. He and others also recommended an overhaul of the patent system, to reduce backlogs and address inefficiencies and the growing problem of "patent trolls."

Several of the CEOs also counseled patience. Deleveraging, they pointed out, takes time. "Slowdowns are to be expected after the rapid pace of growth in the world's economies over the past couple of decades, and businesses should take advantage of the time to re-focus on the basics and prepare for the resumption of growth," wrote Jack Ma, CEO of the Alibaba Group, the Chinese Internet company. "It's like Tai Chi [the Chinese martial art]—sometimes you need to go slow in order to go fast again."

Klaus Kleinfeld, CEO, Alcoa Inc said ."Confidence is like the air the economy needs to grow and thrive. We need a positive, forward-leaning message from the president—and business leaders—aimed at the real challenge: improving American competitiveness and fostering growth and innovation."

Brent Saunders, CEO, Bausch & Lomb Inc. quipped: "Institute a lower corporate tax rate to encourage domestic investment including incentives to invest capital and conduct research in the United States. The U.S. corporate tax rate is on average ten percentage points higher than other world economies, which is a key factor in driving corporate investment overseas."

Jack Ma, CEO, Alibaba Group: "Put your trust in young people and in small businesses. Young people will bring the new ideas an innovations that will create a brighter future. Small businesses are the backbones of the world's economies in terms of employment, tax base and overall contribution to society, and in some cases they are tomorrow's big companies."

Rene Lerer, M.D., CEO, Magellan Health Services: "The government needs to be a better partner with the business world. There needs to be a concerted effort to create jobs throughout the country through a governmental-private partnership. The corporate community needs predictability and support. If we can move forward with the philosophy of "no surprises" with clear and predictable guidelines and support that would go a long way."

George C. Halvorson, chairman and CEO, Kaiser Permanente: "Health care costs are damaging the total economy and destroying government budgets. We spend twice as much money buying care as any other country on the planet... We need to significantly improve the processes of care delivery to the point where we get better care for less money than we spend now. "

Bold talk and great ieas. Can they back it up when the quarterly pressure’s on to deliver the numbers they need to appease their analysts and stakeholders?

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Smart Marketers Find Opportunities in Slow-Growth/No-Growth Economy

2011-09-02T18:39:00.004-04:00

Thought leadership, content marketing leads the way when already long sales cycle gets even longer. QR codes can help, but no one size fits all solution.

Today’s ho-hum Labor Department report for August show the U.S. economy neither added nor lost jobs during the month, the worst performance since last September. Cuts in the public sector entirely offset the private sector's gain of 17,000 jobs. Figures from earlier months were also cut, due largely to steeper cuts by government. The unemployment rate remained unchanged at 9.1 percent. The economy does have some bright spots: Weekly filings for jobless claims remain relatively steady rather than signaling a pickup in layoffs. Sure, spending activity has slowed, but consumers boosted their spending ahead of the August maelstrom of events. And businesses, while nervous, haven't panicked in a way that would create a self-reinforcing downward spiral.

Government stats show the private sector actually added an average of 83,000 jobs over the past three months. That ain’t going to turn the economy around but, economists say the pace suggests continued slow growth ahead.

Home prices and consumer spending show signs of life

The S&P/Case Schiller Home Price Index http://www.standardandpoors.com/indices/sp-case-shiller-home-price-indices/en/us/?indexId=spusa-cashpidff--p-us----
increased 3.6 percent in the April-June quarter and consumer spending in July rose 0.8 percent-- its fastest rate in five months. Economists pointed to strong demand for motor vehicles which shows confidence to make significant, fairly long term purchases. OUR TAKE: If nothing else that should ease some concerns that we’re sliding into another recession. You don’t need to be a PhD economist to know we’re simply stuck in a slow-growth, frustrating, wait-and-see, spin your wheels, don’t-take-on-any-big risks economy. It doesn’t mean folks (and companies) aren’t spending. It DOES mean the sales cycle and purchase consideration cycle is longer. That’s where thought leadership and content marketing comes in as we’ve pointed out in earlier posts.

New data on content marketing/thought leadership

More than 90 percent of marketers believe content marketing is effective at helping them achieve their search engine optimization (SEO) goals according to a new benchmarking study from research firm Marketing Sherpa http://www.marketingsherpa.com/ and Internet Marketing Report maintains that “content marketing is quickly becoming the most effective way to ramp up business on the web,” especially with regard to SEO, Email and social media. The Marketing Sherpa report says content marketing is most effective when in Educates, Builds Trust and Speaks to Success. Help prospects solve problems

If nothing else, your prospects are looking for information that will solve their problems, boost their business and make their lives better. Sherpa researchers report that the 5 most effective forms of content marketing are the tried and true ones:
· White papers
· Newsletters
· Survey data
· Blogs
· FAQs

QR Codes Best in Magazines, Newspapers & Packaging
Young males affluent most likely to jump on QR bandwagon

A new comScore study on mobile QR (Quick Response) code scanning readable by smartphones, found that 14 million mobile users in the U.S., representing 6.2 percent of the total mobile audience, scanned a QR code on their mobile device. Who’s scanning the most on their mobile devices? Researchers, no surprise, said it’s the young, male, affluent audience: male (60.5% of code scanning audience), skew toward ages 18-34 (53.4%) and have a household income of $100k or above (36.1%).

More than half of all QR code scanners were between the ages of 18-34. Those between the age of 25-34 were twice as likely as the average mobile user to engage in this behavior, while 18-24 year olds were 36% more likely than average to scan. More than 1 of every 3 QR code scanners had a household income of at least $100,000, representing both the largest and most over-represented income segment among the scanning audience.Among mobile users who scanned a QR code on their mobile devices in June, 58 percent did so from their home, while 39.4 percent did so from a retail store and 24.5 percent did so from a grocery store.

The most popular source of a scanned QR code was a printed magazine or newspaper, with nearly half scanning QR codes from this source. Product packaging was the source of QR code scanning for 35.3 percent of the audience, while 27.4 percent scanned a code from a website on a PC and 23.5 percent scanned codes from a poster/flyer/kiosk.

So as we slog through this slow-growth economy, keep experimenting with new ways to drive your message home, but remember patience, and disciplined persistence will keep you top of mind with prospects—and content marketing that educates, builds trust and speaks to success will get you in the door.

Happy Labor Day.

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Blogging Remains Top B2B Content Marketing Tactic

2011-08-16T10:37:00.007-04:00

Whatever is old is new again. Timeliness and relevance still reigns in this instant message, zero-attention span environment.

What’s the top B2B content channel to support your primary marketing objectives? Facebook? Twitter? Youtube? Webinars? Actually it’s blogging, the good old fashioned workhorse of business thought leadership, according to a new Focus Research report on the challenges and priorities of B2B marketers.

According to researchers, nearly two in five (39%) B2B marketers cited Blog Posts as their No. 1 type of content to support their primary marketing objectives. Webinars and Virtual Events came in next, cited by 38 percent of respondents, followed by Industry Whitepapers (31%), Videos (23%) and Data-Driven Research Reports (20%).

OUR TAKE: This research shouldn’t surprise you. In today’s fragile “wait and see” business climate, sales cycles have gotten longer. That’s increased the need to keep your prospects engaged during the consideration phase of the sales cycle. To that end, smart marketers are providing valuable content to decision-makers and influencers at their target customers. Blogs have been particularly successful as they can be updated and delivered much faster than a webinar, video or white paper—but with a lot more “meaty content” than a banal twitter post or Facebook “like.”

Blogs drive traffic and search results

Hubspot’s latest study shows that the number of companies actively blogging has grown to 65 percent today from 48 percent in 2009. Here’s why. Researchers found that companies that blog have 55 percent more visitors, 97 percent more inbound links and 434 percent more indexed pages than companies that don’t blog.

But, I’m not a writer

You don’t have to be a journalist—or hire one on staff—to create a meaningful blog for customers. You just need to show customers you understand their pain points and can help them solve their problems. If you understand your market, you’ll never run out of material. You can alternate an opinion post one week with a customer testimonial the next week, with an employee (or product) spotlight the next week with a short how-to article the next. Still not enough? Then try linking out to articles or research in the trade publications your prospects follow and then comment on the article with your authoritative spin on whether you agree or disagree with the findings.

“Blogs are a great way to get your name out there as a thought leader—and search engines love them, Bill Sheridan told us over coffee the other day. Bill is the editor and electronic communications manager of the Maryland Association of CPAs a very progressive professional society when it comes to connecting with members in this electronic age.

So don’t worry about being a writer, or even a hotshot blogger. Just be the expert in your target niche and if nothing else, be the best friend of your customers, prospects and decision-influencers at your target companies. Give them some ammunition to convince their boss, CFO or board and they’ll be your advocate for life.

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Don’t Sweat the Stock Market, Sovereign Debt crisis or Jobs Report

2011-08-06T21:21:00.004-04:00

There’s lots of work to be done and companies are spending money. They’re just not hiring full-timers to do it. Be wary of over-weighting your marketing portfolio on Facebook.

It’s a lazy, muggy Saturday in August. Like millions of American’s we’re headed to the airport, but not for vacation. We’re on our way to a hot, landlocked Midwestern city for the start of a client’s biggest annual convention. That’s right. It kicks off on the first Saturday in August, goes full tilt first thing Sunday morning and extends only into Monday for most attendees. Perhaps it’s a sign of the times, but more and more B2B event organizers have realized that to attract a crowd in this zero-job-security economy, they’ve got to minimize the amount of time attendees spend out of the office. And they better stress the educational and business development parts of the conference, and de-emphasize the aura of a drunken social junket.

We’re not going to spend much time here re-hashing yesterday’s jobs report and the roller coaster week on Wall Street. From a glass half full perspective, it wasn’t so much the 120,000 new people added to American payrolls last month, it was the breadth of the new jobs, as many sectors—not just one or two-- showed some initial signs of hiring activity. Are we worried about the bloodbath on Wall Street which essentially wiped out the entire year’s worth of gains in 2011? Not so much. The market has long been decoupled from the overall economy as corporate earnings are more a factor of (a) low interest rates; (b) relatively easy access to credit and (c) the ability to sustain operations with fewer employees which improves the bottom line.

NOTE: None of the aforementioned factors are sustainable in the long term—especially doing more with less, as frustrated underappreciated workers will bolt for the doors when the job market eventually improves. While many are concerned about the debt ceiling right now, we’re more concerned about the “Great Brain Drain” that will eventually devastate companies who don’t start taking better care of their burned out talent.

OUR TAKE: If you’re a savvy B2B marketer, business are being very selective about how they spend their dollars for advertising, capital improvements, technology and raw materials, but they ARE spending—and they’re doing so at a healthier clip than individual American consumers. Our advice, be just as selective about who you target and fortunately there are a great many tools out there to help you stay hyper focused on the best prospects for new business.

If you’re waiting for us to start trumpeting the merits of mobile and social media, you’ll be disappointed. There are hundreds of thousands of other blogs you can spend time with. We just want you to be smart about how you use these widely publicized, albeit hard to measure tools. And just like the financial advisors whose balanced portfolio approach will successfully guide their clients through the latest financial crisis, you don’t want your marketing portfolio too heavily invested in any single channel.

Face the facts about Facebook

New research indicates that Facebook shouldn’t automatically be the linchpin of your social media strategy. Data from ROI Research, Inc. found that companies who actively use social media found Twitter more effective than Facebook for getting your customers/followers to talk about your product or service, recommend it to friends and buy it. ROI researchers found Twitter to be 13 percent more likely than Facebook to induce followers to attend your promotional or sponsored event; 12 percent more likely to talk about your company or product; 6 percent more likely to recommend your company or product and 12 percent more likely to link to an ad for your company or product.

And that’s not all. Upstart StumbleUpon.com recently unseated Facebook as the No.1 social media site for referring traffic to other website, according to the web analytics firm, StatCounter. If you haven’t checked it out yet, StumbleUpon.com is a search engine that finds and recommends videos, articles and other web-based content to you based upon your tastes and the interests of your peers.

Finally, a Smartbrief poll on Social Media found that marketers and others interested in social media in business say their companies have not lost money because of social media, but more than 25 percent said they “spent too much on maintaining a social presence for the level of return we’re seeing.” Another 3 percent said they lost money because of legal issues, leakage of sensitive information, or brand damage.

Bottom line. You need to use the tools that most effectively connect you to your clients, customers and prospects for the long-term. You don’t need to be cool for the sake of being cool. Don’t be afraid to experiment. But just like investors who chase the latest fad, marketers who chase the latest cool communication tools without carefully weighing its merits and pitfalls will get burned in the long run.

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Finishing What You Start

2011-07-19T16:24:00.001-04:00

What U.S. military and women’s soccer team can learn from savvy marketers. Hiring trends optimistic for digital media. Speed and innovation key.

For better or worse, it’s that time of year when vacations, out-of-office replies and steamy summer weather conspire to slow down the pace of business decision-making worldwide, even in the U.S. For most of us here at HB, it’s the most stressful time of year, because we worry we’re overlooking something or just plain not trying hard enough when the phone’s not ringing off the hook and frantic emails aren’t clogging our inboxes.

Other folks—the smart ones—take this opportunity to catch their breath and contemplate where their businesses are going, what could be going better and what could be done more efficiently.

Thanks to the ease of social media, online video and virtual events, our guess is that there have been a record number of new media initiatives started in both the corporate and not-for-profit world. But, rather than really analyzing what’s working and not-working well, most organizations just keep launching new initiatives to show they’re cool, up-to-speed and always in touch with their customers, clients and constituents. Of course, constant startup, without the discipline of mid-course corrections, much less finishing, will simply drain your energy, your resources and your organization’s patience and take you off your core mission. Either that, or a cynical CFO, VC or IT person asks to see some measure of return on resources expended. At that point, most innovators throw in the towel…or start something new.

Soccer, military and finishing

If you saw Sunday’s heartbreaking World Cup overtime loss by the U.S. women’s soccer team to Japan, you know what we mean. How many times did the commentators and even U.S. national team coach, Pia Sundhage use the term “finishing” or lack thereof? The U.S. kept blowing scoring chances throughout the scoreless first half and through much of the second half. Then every time they managed to bang one through the back of the net, the plucky Japanese squad would score the equalizer a few minutes later. When it came down to overtime penalty kicks, you could tell on the Americans’ faces they knew they would be toast.

We’ll keep our political views out of this forum, but, we can only sustain so much “nation-building” in Afghanistan, Iraq and other war-torn regions around the globe at any given time. Without the resources and strategy to finish what we started, we’ll have nothing to show for all the lost lives and billions of wasted dollars across the globe….kind of like a website with lots of outdated “news”, and old links leading nowhere.

Upbeat hiring trends for digital media professionals

Ed Koller, Managing Partner of Howard-Sloan-Koller Group wrote to clients on Monday that “innovation” was the dominant word in business last year. “But know we know that innovation alone is no longer enough. Speed is the overarching mandated. Speed to market for products; speed to hire for talent.”

HSK says despite the gloomy job market nationwide, there is a “staggering volume of demand” for digital product development, content development, sales and marketing professionals. As New York Times columnist, Thomas Friedman wrote last week, companies “are increasingly picky. They are all looking for the same kind of people —people who not only have the critical thinking skills to do the value-adding jobs that technology can’t, but also people who can invent, adapt and reinvent their jobs every day, in a market that changes faster than ever.”

Finishing what you start (video)

So if you’re an employee, manager or business owner, how do you make sure you and your teams are ready to really finish what they start? We recommend this video by best-selling author and futurist, Seth Godin who argues we don’t need people to be more creative. We need people to keep thrashing and have the courage to ship—when they say they’re going to ship.

WARNING: The vid’s about 18 minutes long. Don’t view it unless you have time to watch it all the way through and give it your undivided attention.

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End of Space Shuttle Program Doesn’t Mean End of American Innovation

2011-07-12T18:17:00.006-04:00

VC investments way up and B2B advertisers look to third wave of advertising

We’re no rocket scientists here, but today and July 20 will mark historic milestones for the U.S. space program. In case you missed it, today was the final “spacewalk” by the crew of the Space Shuttle Atlantis. And when the shuttle lands on July 20 at Kennedy Space Center, it will be on the 42nd anniversary of the first moon landing. For many of us born at the tail end of the Baby Boom, Neil Armstrong’s historic moonwalk was one of our earliest memories of actually paying attention to something on the evening news. This month, as the space program goes into early retirement, it signals our generation’s official descent into middle age. But, we don’t seem to be the only ones running out of steam. That’s just not acceptable to us here.

As Frank Bruni of the New York Times wrote the other day, the shuttle was the “centerpiece of our country’s gaudily ambitious space adventures. The shuttle program was a pre-eminent symbol of our belief that there were literally no limits to where we could go and no boundaries to what we could accomplish, so long as we hitched our ingenuity to our imagination and marshaled the requisite will. The program’s end carries the force of cruel metaphor, coming at a time when limits are all we talk about. When we have no stars in our eyes.”

Yesterday, a sobering U.S. Chamber of Commerce Report was released. According to the Chamber, almost two-thirds—64 percent—of small-business executives surveyed said they weren't expecting to add to their payrolls in the next year and another 12 percent planned to cut jobs. Just one in five (19%) said they would expand their work forces. This comes after a Labor Department report Friday showed employers added few jobs in June, and unemployment rose to 9.2 percent. The Small Business Administration says small businesses, defined as companies with fewer than 500 workers, employ about half of the workers in the private sector. In the Chamber's survey of 1,409 executives, conducted by Harris Interactive, small businesses were defined as firms with revenue of $25 million or less.
A Gallup/USA Today poll conducted in late April found that 55 percent of Americans considered it unlikely that children today would have better lives than their parents, while only 44 percent considered it likely. Those responses were the most negative, by far, over the last quarter-century, and they undercut a central tenet of American optimism.

And 39 percent of the respondents in a recent New York Times/CBS News poll characterized that decline as permanent, at least in economic terms. That was a marked increase from 28 percent who said so last fall.

The President talks a great deal about charting “the frontiers of innovation,” but his administration doesn’t seem to have a plan and maybe we shouldn’t leave it to the government to do it for us.

Our take: The U.S. space program was created not out of scientific curiosity but out of national security to keep pace with the Russian space program. Right now we have a different kind of threat and that’s economic threat of China, India and other fast developing economics. We need to have an economic/innovative version of NASA right now……education, starting companies and smart, efficient marketing.

3rd Wave for advertising

If you get a free moment, take a look at J. Brooke Aker’s piece from Online Media Daily about the maturity of display advertising. Aker also quotes Google’s Neal Mohan who’s argues we are just now entering the 3rd Wave of digital advertising maturation that futurist Alvin Toffler predicted in the 1980s. Apparently we have moved from media explosion (Internet, ubiquitous connectivity and multiple devices) to technology that makes ads efficient and makes media pay, to a user-centric 3rd wave.

Our take: We’re encouraged by this assessment because this is where consumers have much more say -- in the ads they skip, ads they replay or their preferences for ads. Amen to that.

Venture Capital on the Rise

Total capital raised by U.S. venture firms in the first half of this year hit $8.14 billion, that’s a 20 percent increase over the same period last year, according to Dow Jones. Meanwhile, the National Venture Capital Association said capital fundraising during the first half of 2011 totaled $10.2 billion from 76 funds, a 67 percent increase by dollars compared to the first half of 2010.
Next week we’ll look at how content marketing is challenging traditional advertising for smart B2B marketers.

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Mid Year Review: Companies Thriving, Wage Earners and Homeowners Still Suffering

2011-07-01T16:06:00.003-04:00

How smart B2B marketers thrive in this schizophrenic economic climate

U.S. stocks rose sharply today, on pace for their biggest weekly gain in a year. Strong readings of manufacturing activity lifted spirits ahead of the long holiday weekend and investors may feel confident that no major “fireworks” are forthcoming from the euro zone and Greece debt crisis to ruin their barbecues and parades. Industrial, financial and tech stocks have led the rally, which is good news for many of you readers who work in—or sell into—those sectors. The market registered sharp gains after data released by the Institute of Supply Management showed the U.S. manufacturing sector expanded briskly in June. The ISM's manufacturing purchasing managers' index rose to 55.3 in June from 53.5 in May. Experts say readings above 50 indicate expanding activity.

If you’re wondering how the financial markets and corporate profits can be so high at a time when the jobless rate, housing market and energy prices are in the dumps, researchers at Northeastern University may have some clues. In their newly released study, (PDF file) “The ‘Jobless and Wageless Recovery’ From the Great Recession of 2007-2009, the Northeastern economists found that since the recovery began in June 2009 following a deep 18-month recession, “corporate profits captured 88 percent of the growth in real national income while aggregate wages and salaries accounted for only slightly more than 1 percent” of that growth. The study, said it was “unprecedented” for American workers to receive such a tiny share of national income growth during a recovery. The study called that $27 billion loss in aggregate wages and salaries during the seven quarters after the recovery began “the first ever such decline in any post-World War II recovery.”

“Aggregate employment still has not increased above the trough quarter of 2009, and real hourly and weekly wages have been flat to modestly negative,” the report concludes. “The only major beneficiaries of the recovery have been corporate profits and the stock market and its shareholders.”

Our Take: Consumers are still very pessimistic about their home values and job security, so if you depend on luxury goods, discretionary spending for travel and entertainment, then you’ll have to pick and choose your marketing spots very carefully. But, if you’re targeting decision makers in the heavy equipment or large corporate sector, then you need to get on their radar ASAP as they’re setting budgets for long-term capital expenditures right now.

Here are some key marketing trends to watch for the second half of this year

First two non-events: the new HP tablet and the Zynga billion dollar IPO. These are not game changers as much as late arriving “me too’s.” Don’t be fooled by the hype

Location infiltrates the advertising market

Location-based advertising is set to triple its percentage of mobile advertising in the next four years. The increase will partially be due to the US’s high adoption rates of mobile devices with GPS capabilities. Revenue for this advertising market is projected to increase ten-fold in the same time period, according to Pyramid Research.

Our Take: Consumers will have greater access to this type of advertising in the near future because of technology progression. Advertising companies at the front of location-based services could see much higher demand from businesses in the near future.

eReaders on the rise, tablets cool off

The ownership of eReaders has surpassed that of tablets largely due to price differences and improvements in technology. The entry price for eReaders undercuts tablets by a few hundred dollars, and eReaders are taking up a share of the tablet market as they begin to incorporate internet-based applications, like browsing the web and checking mail.

Our Take: The rise in eReader adoption will lead to a shift in support and resources from companies appealing to consumers. In part because of their lower price point and lesser technology, eReaders are cheaper to develop applications for than tablets. As many industries are probably in a hurry to try and capture the market opening caused by the iPad craze, it actually may be wiser to focus on the rapidly expanding eReader market. eReaders are also more literature-focused, which could lead to higher adoption rates in the corporate world. Additionally, recent reviews for products such as the nook and kindle have been raving according to CNET www.cnet.com , while their price factor helps them beat out the iPad in a recent CNET head to head comparison.

A new approach to banner ads

New Google studies show that the average rate of users who click on ads is 0.1 percent. A separate study, conducted by Real Media, shows that the main reason people ignore ads is because they did not want to leave the web page they were currently on. In light of this information, startup Adkeeper www.adkeeper.com has put a new spin on ads, one that increases that click rate by 34 times—that’s right, 34 times higher! Adkeeper is making advertisements ‘less interruptive’ as company founder, Scott Kurnit, told the NY Times on Tuesday.

Our Take: Although the articles take on adkeeper is heavily skewed towards entertainment and consumer-oriented industries (and not B2B), there is still a strong possibility that Adkeeper can help businesses. If a company is targeting the right audience and advertising on the right sites, then consumers will save these ads. For example, many may be reading an article and see an ad that they do not necessarily want to click on right away. However, if the ad appeals just a tiny bit to them and their industry, they can easily save and go back to it later.

Have a great Independence Day Weekend and remember what a great (and resilient) country this is despite all our current challenges.

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Signs of a Turnaround?

2011-06-21T18:04:00.001-04:00

IPOs, venture capital and philanthropy up. Why smart companies respond ASAP to online customer complaints

IPO Market

Just when you thought a double dip recession was on the horizon, signs of optimism are emerging. I noticed a significant drop in gas prices on a weekend trip through the Northeast Corridor. The Dow seems to have found a support level at 12,000 (up over 100 points again today), despite ongoing agita over the debt crisis in Greece. Technology IPOs have generated nearly $330 million in fees for major banks and brokerages houses according to a New York Times report yesterday. That’s the most since 2000 and nearly 10 times what they generated for a comparable period last year. According to the National Venture Capital Association, investors have poured nearly $6 billion into early stage startups the first three months of this year, that’s up 14 percent from the first three months of 2010.

Charitable giving on the rise

Another study that caught our eye was from the philanthropic front. Charitable giving recovered somewhat last year, according to new estimates by the Giving USA Foundation, but experts are predicting that this year will present more challenges to nonprofit fund-raisers. Individuals, companies and philanthropic institutions made gifts and pledges totaling an estimated $290.89 billion in 2010, an increase of 2.1 percent on an inflation-adjusted basis over a revised estimate of $285 billion the year before. The increase was the first since 2007, when the recession started and led to the biggest decline in giving in more than 40 years.

The power of responding to your online complaints

A new Harris Interactive study confirmed what we’ve been preaching for years—you’ve got to deal with angry customers/members/subscribers ASAP now matter how steamed they are. Here’s why. Researchers found that among customers who got a response from a company after complaining about them online (or on social media):

* 34 percent deleted their negative review
* 33 percent turned around and posted a positive review
* 18 percent turned into loyal customers

As the old saying goes. It’s 10 times easier to keep an existing customer happy than to find a new customer. Thanks to social media and the web, your customers are better armed today than ever before. The Harris findings should be posted over every call center from Nebraska to Mumbai. Smart organizations who heed them will be rewarded handsomely down the road.

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Economy Hinting at Double Dip, But Hiring Strong in Tech, Financial Arena

2011-06-15T09:25:00.004-04:00

Big companies more likely than small business to weather latest storm. Also, why great writing still matters for B2B. How this impacts you.

It may be too soon to predict a return to the days of “irrational exuberance,” but you have to scratch your head when social media companies with questionable financials are leading the IPO market back to life and the equity markets end a six-week slide yesterday because retail sales only went down by 0.2 percent.

Most of us are a lot smarter than we were in the late 1990s, but that doesn’t mean we can’t be lured into the financial equivalent of Weinerian temptation. We know it’s wrong, but we can’t help ourselves. Or you can put a positive spin on this less-than-rational exuberance. How? Maybe we just want this protracted downturn to end so badly that we’ll do just about anything to jumpstart it. Can you say Obamanomics?

Food and gas prices remain high, unemployment is inching back over 9 percent and Americans’ equity in their homes has shrunk to nearly 38 percent, nearing the lowest percentage since World War II, according to a Federal Reserve report this week. For some perspective, it was about 61 percent in 2001. What’s more, home prices have fallen by a third since their 2006 peak, reaching their lowest level since 2003, the Standard & Poor’s/Case-Shiller index of U.S. home prices through May 31. What’s more, the Federation of Independent Business, a trade group representing small business in America, just released its worse monthly hiring survey in eight months. If you sell to small business, those budgets are likely to remain tighter than a portly New Jersey Governor’s belt buckle for some time to come.

Despite this generally depressing news, hiring in the technology and financial services industries, where many of you are engaged has been robust. The U.S marketing director for a well-known online career site told me last week that both job postings and hiring of seasoned execs in financial services is coming back strong and is “white hot” for those in the technology sector. Also, the U.S. trade deficit narrowed again in April which means that’s now two consecutive months in which American companies sold more goods overseas than were imported. Also, last week’s Business Roundtable CEO survey showed that larger companies are more likely to expand their workforces than shrink them in the next six months. Why? They’re more likely to be sitting on piles of cash, they have better access to credit and more exporting capabilities.

Our Take: If you sell to consumers, then there’s still rough sledding ahead, because lack of job security and inability to use homes as ATM machines will keep your customers tight-gripped on their wallets and purses. But, in the B2B sector, companies are looking at the long-term picture, as evidenced by strong 6-figure hiring in the tech and financial sector and bolstering infrastructure and capital expenditures. For instance, a new Commerce Department report said U.S. companies sold more computers, heavy machinery and telecommunications equipment in April, especially to foreign markets. That pushed exports to a record high for the second straight month and narrowed the trade deficit for the first time since December.

Great writing still matters for business marketers

Today’s Wall Street Journal had a great piece by Droga5 chairman, Davi Droga, about the importance of great copy writing in today’s short-attention span, twitter era. “The truth is that good copywriting paved the way for the tweet long before Twitter was actually invented—but who needs all those characters?” he asks.

Social media impact on business

Researchers are finding that social media is great for generating exposure for your business, increasing traffic to your website and improving your search engine rankings, but not so effective for generating leads, increasing sales or reducing marketing expenses. A new study of 3,342 marketers conducted by Social Media Examiner found that while 88 percent of respondents said social media generated exposure for their business, 72 percent said it increased traffic and 62 percent agreed it helped their search engine rankings. On the flip side, only 43 percent of marketers said social media increased their sales, just 49 percent said it cut marketing costs and 51 percent said it generated quality leads.

Why clarity is the new cool

Finally, we recommend this pithy new post by Forbes Chief Product Officer, Lewis D’Vorkin about the importance of clarity in this hyper-cluttered information age.

“Start with clarity, then come up with cool, he says. “If you don’t, you end up with new but incoherent.” We couldn’t agree more.

As regular readers of this blog know, throughout this economic downturn we haven’t wavered from our position: Be smart, stay the course, keep your marketing and product pipeline full at all times, and you’ll always be ready to pounce on new opportunities. That’s a lot more fun (and financially rewarding) than being a hot idea- or hot IPO) chaser.

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LinkedIn and Tablets Increase Decisions for B2B Marketers

2011-05-23T13:31:00.003-04:00

With consumers and small business on one side and ‘tortured” corporate customers on the other, how much longer will users put up with forced updates and interminable boot up time? Google and Apple reinvent computing and computer retailing. Has Mars/Venus gender battle moved to tablets?

Whether or not you think last week’s lofty IPO and post-offering “pop” for professional networking platform LinkedIn signaled a new “tech bubble about to burst,” the head of a large engineering and technology society told me Friday that he was encouraged by the amount of “let’s try and see how it goes” innovation he’s from emerging media, information and technology companies. This ability to innovate, react, evolves and correct early stumbles may be the key to success in the next decade and beyond. Meanwhile, the old guard seems to be drifting further and further back in the rear view mirror.

Hewlett-Packard Co. reduced its 2011 outlook and warned of weaker results in its current quarter in a hastily arranged earnings call last week, a day after an email from CEO, Leo Apotheker to his top brass, warning of tough times became public. News of the memo and the revised outlook sent H-P's shares down 9 percent in early trading on the New York Stock Exchange. HP’s pessimistic outlook is a result of changes the Palo Alto, Calif., company is making in its services business and poor demand for personal computers among consumers. Apotheker said weak PC sales to consumers is an industry-wide problem due in part to the rise of tablet devices such as Apple Inc.'s iPad. Dell, Acer and Sony among others have been whining a similar tune of late.

In response, HP will soon release its own tablet, dubbed the TouchPad, but it will not only have to contend with Apple’s passionately followed products (and social media army), but with Apple’s incredibly successful retail stores—and Google’s lightweight computing devices, which we’ll get to in a minute.

OUR TAKE: We’re not here to predict who’s going to win the table and smart phone wars, but it’s relevant for B2B marketers to know which types of screens, devices and security environment that your target consumers are spending their time when they receive your messages. And that not only includes tablets and smart phones, but LinkedIn-style social networking platforms for professionals and other busy grownups who don’t have hours of free time on their hands and only post when they something relevant to share (or answer).

Gender impact on tablet adoption

If you’re targeting consumers and small business, it’s increasingly likely you’ll to be reaching decision makers not on clunky PC’s, but on open access, easy to use devices –tablets, iPads, smart phones and “smart” notebooks that boot up quickly, and can easily handle rich media, video, apps, downloads and the like. According to a report in today’s New York Times, based on Forrester Research, the majority of tablet owners are male, while the majority of e-readers (such as Barnes’ and Nobles’ Nook Color) are female. Researchers say this has more to do with desire for simplicity (female) or tech power (men) than it does with color, design and actual reading experience although women supposedly want a more contemplative book-like reading experience and men allegedly want a more multimedia, action-oriented experience. Regardless of preference, consumers and business decision-makers are gravitating toward gadgets that are fast, fun, adaptable, easy to carry and easy to fix (often by you, the end user). And these tend to be the devices that don’t block advertising messages as effectively as most corporate spam filters and firewalls. In exchange for this freedom, recipients of your messaging will demand well-thought out creative that’s targeted, relevant and makes full use multimedia.

Meanwhile Google took another swipe at Microsoft last week when it introduced a new kind of computer called a Chromebook, which stores everything online. Google hopes that the devices, which it says will eliminate the need for software updates and hard drive backups and will boot up within eight seconds, will replace PCs running Microsoft’s Windows software in offices and homes around the world.

OUR TAKE: Users are losing patience with endless Windows updates, interminable bootup times and business applications (spreadsheets, presentations, word processing) that work fine, but get over-engineered every 12 months so users have to keep relearning how to use them. Corporate warriors don’t have much choice in the matter, except to covet their spouses, kids and friends’ devices. But, consumers and small business owners DO have a choice, and they’re overwhelmingly going for portability and simplicity over fortress-like security.

However, if your core decision-makers are still in large organizations, then no matter how many fun, easy to work with gadgets they have at home, they’ll still be at the mercy of command and control IT departments—and that means, slow connectivity, limited multimedia and downloading opportunities.

That affects your creative and your ability to get into targets’ sub-conscious. Here, the main objective is simply to get in the door, not to be eye-catching. Corporate spam filters will flag anything they don’t deem plain vanilla. In this environment, it’s best just to play it straight. Stick with bullet points, features and benefits—forget about storytelling and dazzling techno tricks.

Users tired of being tortured

“Whether it be Microsoft or other OS vendors, I think the complexity of managing your computers is really torturing users out there,” Sergey Brin, Google’s co-founder and director of special projects, said recently at the Google I/O developer conference “That’s a flawed model fundamentally. And I think Chromebooks are a new model that doesn’t put the burden of managing your computer on yourself.”

Experts say Google will not have an easy time challenging Microsoft, which dominates the workplace. We think that’s due more to inertia, fear and cozy VAR relationships than it is a result of better products. While Google has bested Microsoft in operating system software for mobile phones, it has taken on Microsoft in the workplace before and failed to budge it, most notably in word processing and spreadsheet software and collaboration tools.

Google says Chromebooks will attract corporate technology buyers because Google automatically updates the Chrome operating system over the Internet and there is no need to back up computers because if they are lost or ruined, all the data exists online. “We’re venturing into a really new model of computing that I don’t think was possible previously, even a few years ago,” Brin purportedly said at Google’s recent user conference, adding that it’s just a much easier way to compute.

Computing in a whole new way

The Chrome operating system, which Google introduced in 2009, does away with desktop software and storing data on a computer. Instead, it is not much more than a browser, and all of a computer user’s information, like documents, photos and e-mail messages, is stored on the Internet, or in “the cloud.” Instead of desktop software like Microsoft Word or iPhoto, people use Web-based software like Google Docs, Microsoft Office 365 or Picasa.

Corporate I.T. departments are not known for quickly adopting flashy new products. However, tablet computers with touch screens, like the iPad, are replacing laptops in some workplaces, so the Chromebook may be late to the game. Microsoft has also seen some softness in its sales for its operating system software. Google’s strategy is to go after businesses and schools first. If students get used to a Web-based operating system, they might request it in their offices later on, and if people use it at work, they might decide to buy one for their homes.

The tagline at the end of Google’s promotional video for Chromebooks? “Ready when you are.” So are we. And so should you, if you’re a smart B2B marketer.

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Obama Nails Osama. Now ReFocus on the Economa

2011-05-03T11:35:00.002-04:00

Take pause to celebrate nation’s military (and social media) milestone. But smart marketers know real worries remain and are picking spots carefully. TV ownership falls in U.S.

Whether or not you’re a fan of the current Administration, the stunning events of Sunday evening’s purported rubout of USA’s public enemy No.1 in Pakistan should give you a sense of…hmmm….if not patriotic pride at least confidence that our legislative and military leaders can honor a highly ambitious and longstanding promise to their citizens. That’s good enough for us (as is the President’s birth certificate). We don’t need to see grisly pictures of the massacre and open-sea burial of al Qaeda's top motivational speaker to know that the job got done quickly, efficiently and with minimal collateral damage.

Well done USA! Now let’s get back to business.

Is the threat of terrorism over? Hardly. At this stage of the game, bin Laden was more of guru consultant than an operative and we should prepare for retaliatory strikes and another spike in fuel prices. Both threats will continue to impact business by making air travel, commuting, shopping and raw materials more expensive and less efficient. The high unemployment rate, lousy housing market and huge disconnect between the stock market and economic conditions aren’t helping.
Our take? Expect another surge in the use of online shopping by consumers and the use of webinars and virtual meetings and conferences by the business community.
Social media in the spotlight

Another facet to this stunning news event was the speed with which millions of ordinary citizens got wind of bin Laden’s demise via social networking—not via the “official” news media and the reassuring voice of a trusted network anchor.

Thanks to Twitter and Facebook, the mobile devices of 45,000 baseball fans lit up at Sunday’s Phillies-Mets game and chants of U-S-A reverberated throughout Citizens Bank Park before the scoreboard operators or players knew why. Unconfirmed reports — that turned out to be true — of Osama bin Laden’s death circulated widely on social media for about 20 minutes before the talking heads of the major broadcast and cable networks reported news of the raid at 10:45 p.m., about an hour before Mr. Obama’s address from the White House.

While social media is not always reliable and is not a great platform for insight and analysis, it’s the communication tool ideally suited for breaking and sharing news and information and thanks to the proliferation of mobile devices—it’s the “tool” most likely to be used first when someone wants to be in the know (or sharing what they know).

Several reports said Twitter saw the highest sustained rate of posts ever--with an average of 3,440 per second from 10:45 p.m. to 12:30 a.m. ET—and there were more than 5 million mentions of Bin Laden on Facebook in the U.S. Text messages and social networks did not only help people get and spread the news about Bin Laden’s death, but they are believed to be significant contributors to the spontaneous gatherings at Ground Zero in NYC and outside the White House in DC. Once the Prez made his announcement, users of Instagram, a photo-sharing application for the iPhone, flooded the service with photos of Obama speaking, snapped from televisions and laptop screens. Soon there were photos of American flags and then photos from the crowds gathered in New York and Washington.

Most of these digital natives are not eschewing conventional news media entirely. They know they’ll get the analysis, commentary and fact-confirmation over time. But, if your media plans are still not aligning your spending with where your target market spends its time, then now is the time to have a serious reality check.

Ownership of TV Sets Falls in the US

Speaking of historic milestones, The Nielsen Company reported yesterday that the number of TV-less homes in the U.S rose for the first time in 20 years and that will have an impact on ratings numbers for all forms of broadcast television. According to Nielsen, virtually every U.S. household (98.9%) had a TV set the last time it checked. Now the number is down to 96.7 percent. While some experts say the drop reflects rising poverty in which some low-income households can no longer afford the cable boxes and digital accoutrements required to watch most channels satisfactorily, a more plausible explanation is that younger people, who’ve grown up with laptops and mobile devices in their hands, are not purchasing conventional TV sets when they get out on their own as they’re so used to gaming and watching their favorite shows and movies from the web.

Our take? Not only will the number of traditional TV households continue to decline, but the number of multi-tasking, attention-divided consumers will continue to rise. Conventional broadcasters and their sponsors still have a long way to go when it comes to targeting their messages to consumers and presenting content at a pace, and uninterrupted form, that will keep them engaged.

The world’s not necessarily getting more complex. It’s just getting smaller and moving faster than we’ve been used to. You can’t possibly keep up with all it all. Trust your friends, colleagues and professional networks to help you out. And when they do, always make sure you return the favor.

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Americans consuming more media, but also more distracted

2011-04-13T15:14:00.003-04:00

Smart B2B marketers are embracing the multi-tasking consumer with relevant multi-platform campaigns. Hiring, pay trends bode well for marketers.

New research from Abritron and Edison Media Research indicates that Americans spend about 20 percent more time consuming media (traditional and new media) than they did 10 years ago. Researchers attribute this to the widespread adoption of smartphones and a 26 percent rise in the number of Americans with access to the Internet. Researchers say U.S. consumers now spend 8 hours and 11 minutes per day with radio, TV and the Internet, up from 6 hours and 50 minutes a day in 2001. But are they really paying attention commensurately.

Our take? As a whole, these numbers are quite plausible, but the amount of time consumers and business decision-makers are giving media their undivided attention has likely gone down. Younger consumers are particularly oriented to multi-tasking and the savviest marketers have learned to embrace this trend, rather than fight it.

Keep this in mind as you pore over recent reports from a number of highly reputable pundits and research firms who’ve been lamenting the apparent mismatch between media consumption patterns and media dollars received. Despite the projection that online advertising will increase its share of US major media ad spending by more than 10 percentage points between 2009 and 2015, spending on digital, including internet and mobile, has not yet risen to match consumption patterns, according to research firm eMarketer.

Among the major media of television, Internet, radio, mobile, newspapers and magazines, US adults still spend the most time each day with TV. Researchers at eMarketer estimate that adults watched television for 42.9 percent of the time they spent each day with those media in 2010, and ad dollars align closely, at 42.7 percent. The Internet, by contrast, took up 25.2 percent of adults’ daily media time in 2010, but received just 18.7 percent of US ad spending.

“Those of us focused on the internet channel have complained for years that it hasn’t been getting its fair share of media dollars based on time spent,” said eMarketer CEO Geoff Ramsey in a statement. “However, the precise extent of that imbalance has been shrouded in mystery and exaggeration. Now we know—it’s a gap of 6.5 percentage points.”

Allen Mutter, author of the popular Newsosaur blog observes that newspapers have lost nearly half of their ad revenues in the last five years, yet some analysts believe they still are getting three times more advertising than their readership deserves.

Because the allocation of ad-market share is a zero-sum game, print has to be benefitting at someone's expense. And two notable victims, in this case, are Internet and mobile advertising.

As Mutter notes, the most egregious mismatch discovered by the eMarketer study found that only 0.5 percent of advertising goes to mobile phones even though people spend more than 8 percent of their media time using them. With 25 percent of media mindshare devoted to the Internet and barely 19 percent of ad dollars going to the web, it is being shortchanged, too. This is good news for newspaper publishers because it proves that they have done an excellent job to date of convincing marketers of the value of their medium. Yes, they’ve cornered a disproportionate share of advertising in comparison to other media. We’ll have to see how the pay wall experiment at The New York Times and other leading dailies plays out.

Our take? We salute the time the Times for taking bold action, but it’s just too hard to get savvy consumers to pay for something they’ve been used to getting for free. The Times’ tiered subscription offering is just too confusing—both for subscribers, casual readers and their own customer service department too handle right now—and that will have costly bottom line ramifications down the road. We also expect savvy readers to go in via the backroom of blogs and social networking sites to get the NYT articles they want without being subject to a direct pay-per-read tax. There are simply too many other places to get one news in real-time for free.

Hiring, pay trends bode well for marketers

Companies are shelling out for seasoned marketers with e-commerce skills according to executive search firm, Crandall Associates. VP’s of e-Commerce are commanding $113K to over $200K with Internet marketing directors and interactive creative directors not far behind. What’s more, about 20 percent of those senior marketing folks expect to be hiring themselves in Q2, says Crandall. Meanwhile, new hiring data from Robert Half Associates says 20 percent of companies are looking to hire those with social media skills and 16 percent are looking to hire those with media services expertise. This data mirrors overall corporate hiring trends. Last week, Business Roundtable’s quarterly survey of CEOs found that 52 percent of companies planned to hire workers in the U.S. over the next six months and just 11 percent said the plan to reduce their workforces. That’s the widest gap hiring versus cutback gap ever recorded in the nine-year history of the survey.

And what kind of social marketing activity demonstrates the best ROI for companies? Almost three in five (59%) companies surveyed by MarketingProfs.com said “Ratings and reviews” provided the most bang for the buck, followed by “Your company/brand community” (56%) and “Your company/brand blog” (48%). These activities outpaced such tactics as “Participating in industry blogs and forums, Facebook, Twitter and Linked In (41% to 28% respectively).

So, it looks like companies are willing to pay more for real talent again instead of hiring what they can get at recession-era bargain rates. We’re betting that the next wave of high performing marketers are not only those with in-demand skills today, but those who can adapt their skills—and campaigns—to meet an ever-changing set of market conditions.

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Is This Ad Spending Recovery for Real?

2011-03-26T12:44:00.005-04:00

Upbeat mood helps twitter following. Social media usage drives mobile device satisfaction, but declining call quality and proposed AT&T merger could be fly in mobile growth ointment.

Yesterday’s revised numbers from the U.S. Commerce Department indicated the economy is growing at a faster—i.e. less anemic rate—than previously believed. Government GNP prognosticators Friday upped their estimate of Q4 economic growth to an annualized rate of 3.1 percent from a 2.8 percent estimate issued last month.

On the media side, a just-released report from Kantar Media said total advertising expenditures increased 6.5 percent in 2010, buoyed by a strong fourth quarter and a big push from small advertisers outside the Top 1000. Internet display advertising increased 9.9 percent over 2009, cable TV rose 9.8 percent and network TV spending surged 5.3 percent. Expenditures in consumer magazines were up 3.3 percent, but B2B magazines dropped another 1.2 percent, and local newspapers sank 4.6 percent—its 21st consecutive quarterly decline.

Our take? Consumer, businesses and lenders have become less pessimistic about homes and jobs. TV, mobile and the Internet will continue to thrive this year—we expect double digit gains. If we can find any cheer on the print side, it is that ad pages in the Finance category were up 9.3 percent according to year-end 2010 PIB numbers and ad pages from Technology sponsors were up 2.3 percent. Tech and finance are two of the most important, and most cyclical, sectors for many of our clients and we expect to see more long-form thought leadership campaigns in 2011, not the direct response or mass branding campaigns that have dragged down other print categories.

Upbeat mood helps Twitter following

A new Indiana University research paper says that people who use Twitter congregate online according to their mood, not just by age or similar interests. For example, the research, found that people who send Twitter messages that include the word “loneliness” also tend to flock together on Twitter. To understand how mood plays a role in the camaraderie of people on social networks, researchers monitored 102,009 active Twitter users for six months. The researchers then applied a psychology theory, “subjective well-being,” to each message to understand its mood. The results found that people who are happier on the social network tend to re-tweet or reply to others who are happy, too. The same results were found with those who were unhappy.

The researchers summarized that “online social networks may be equally subject to the social mechanisms” that govern the real world, where real-life interaction can revolve around mood and feeling, too.

Active mobile users are active online searchers

According to the NEW BIGresearch Simultaneous Media Usage Survey, mobile users who actively search for information, such as news, sports and TV/videos, are more likely than general consumers to conduct regular product research online. When it comes to searching for financial information and services, active mobile users are nearly twice as likely as general consumers to conduct regular product research on online. When it comes to sharing online research findings, nearly 97 percent of all active mobile users say they give advice about products and services, and word of mouth (face-to-face) is the most prominent means.

Cell phone service quality continues to disappoint

If it seems you’re losing more calls than usual on your mobile phone these days you’re not alone. On top of the proposed AT&T / T-Mobile merger which could eliminate choice and advantageous competitive pricing for consumers, the quality of wireless phone calls has hit a plateau, according to J.D. Power and Associates. According to Power, one major driver is the increasing number of cellphone calls placed or answered indoors, as people use their cellphones to replace or supplement landlines. Indoor calls tend to be fuzzier than outdoor calls, because the signal must penetrate walls and windows to reach the tower. Regardless of where the calls were made, J.D. Power said the quality on all handsets — both smartphones and traditional cellphones — seemed to have worsened over the last six months, with smartphones eliciting more complaints than traditional handsets.

But last week, overall satisfaction with smartphones and traditional mobile phones is considerably higher among owners who use their devices for social media activity, compared with satisfaction among owners who do not access social media platforms on their phones, according to the J.D. Power and Associates 2011 U.S. Wireless Smartphone Customer Satisfaction Study.

Among smartphone owners who use their device to access social media sites such as Twitter, LinkedIn and Facebook, satisfaction averages 783 on a 1,000-point scale—nearly 22 points higher than among those smartphone owners who do not often use social media sites on their device. Currently, more than one-half of smartphone owners report having used their device to access social media sites via the mobile Web or mobile applications. While rates of mobile social media site usage are not nearly as high among owners of traditional mobile phones (9%, on average), satisfaction among traditional handset owners who use their device for social media is notably higher than that of traditional handset owners who don’t access social media (754 vs. 696).

“It’s not unexpected that smartphone owners access social media sites from their device more frequently than traditional mobile phone owners due to features such as larger screens and QWERTY keyboards,” said Kirk Parsons, senior director of wireless services at J.D. Power and Associates in a news release. “However, these findings demonstrate that equipping devices with powerful features and service is key to creating positive customer experiences with wireless devices.”

For a fifth consecutive time, Apple ranks highest among manufacturers of smartphones in customer satisfaction with a score of 795 and performs particularly well in ease of operation, operating system, features and physical design. Motorola (763) and HTC (762) follow Apple in the smartphone rankings. Sanyo ranks highest in overall wireless customer satisfaction with traditional handsets with a score of 715. Sanyo performs well in three factors: physical design, battery functionality and operation. LG (711) and Samsung (703) follow Sanyo in the traditional handset rankings.

Once again, innovation and dedication to customer service carry the day. Customers are better armed than ever before to share their experiences with the masses. Thanks to mobile technology, social networking and the web, the strong players—with a disproportionate share of happy customers happily sharing their stories--will further distance themselves from the laggards.

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Don’t Be Fooled by Psychological Benchmarks on Labor, Oil Prices

2011-03-07T09:33:00.003-05:00

Time for B2B marketers to shine

Like the Dow 10,000, the 4-minute mile and the .300 hitter, we’ve always been fascinated with benchmark numbers. Is a .302 hitter really that much better than a .299 hitter? No. Is your 401k really worse off when the Dow dips to 9,992 from 10,003? Of course not.

So, when Friday’s labor report came out about brisk hiring in February pushing the U.S. unemployment rate below 9.0 percent for the first time in nearly two years, forgive us for not popping the champagne corks. Sure an 8.9 percent unemployment rate marks a real milestone not since before the recession, it’s just a number that ignores how much ground the economy has yet to regain. It also hides the more disturbing trend of people dropping out of the labor force—primarily recent graduates and highly experienced workers. That’s the kind of folks we need out there the most—high energy and high experience—whether you’re in software, financial services, driving a bus, hauling waste management or teaching.

NY Times columnist, Paul Krugman, points out today that most of work still being done by humans today is work that can’t be easily automated. That goes for manual labor as well as for white collar information workers. And the tables are shifting on those two fronts as U.S. white collar jobs are increasingly being automated and manual labor jobs are increasingly becoming specialized. Check out Paul’s take on this 21st century conundrum here

One key gauge of the labor market's health—the labor force participation rate, which measures the percentage of adults who have jobs or are seeking them—remains stuck at its lowest point since the mid-1980s. But, as the Wall Journal’s Phil Izzo and Morgan Stanley Economist, David Greenlaw explain, “a low participation rate both saps the economy's long-term growth potential and can obscure deeper problems in the labor market. If, for example, labor force participation today were at the same level as before the recession, the jobless rate would have been 11.5 percent in February.”

As of February, 4.4 million people had been out of work for more than a year. The labor force participation rate stood at 64.2 percent, down from 66 percent in December 2007 when the recession began. We expect the jobless “rate” to go back up over 9 percent in the coming months as formerly discouraged workers rejoin the job hunt process. That’s still a positive sign of slow, steady improvement. Don’t let next month’s jobs report stall you’re hiring or expansion plans.

Impact of $100+ per barrel oil

Unfortunately, employers and consumers must deal with the implications of the rising price of oil, which hit a 2.5-year high, closing at $104.42 a barrel Friday. Is it going to hurt? Yep. Many reliable sources are predicting $4 or $5 per gallon at the pump as we head into peak summer driving season. While Libya accounts for just a small fraction of world oil output—which Saudi Arabia has told us they could easily cover—it’s the uncertainly, not true supply and demand that’s driving this price spike. Unfortunately, rapidly rising prices not only hurt consumers and businesses immediately as it costs more to commute, shop, fly, run their equipment, etc. The price shock cuts into profits, hiring plans and consumer shopping plans as real hourly wages have gone up only one cent this year for those lucky enough to be employed.

Hiring picture brighter for media professionals

Despite all the agita described above, the lift in “intention to hire” is the biggest in 11 years according to researchers at Bernhart Associates who conducted a survey of digital and direct marketers. If the Fed and naturally occurring economic drivers can’t stimulate demand, that’s where great marketing and sales follow up comes in. And no one does that better than U.S. media mavens.

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Time Warner Leverages SI Swimsuit Issue to Launch All-Access Subscription Model

2011-02-17T13:25:00.004-05:00

Watch out for ‘brain drain’ at your company as economy improves

In case you somehow missed it, the annual midwinter Oogle-palooza for the publishing industry, aka. the Sports Illustrated Swimsuit Issue hit newsstands, mailboxes and inboxes this week and once again managed to raise eyebrows and male pulse rates. But, this year the buzz wasn’t just about the risqué swim attire, which included see-through suits, body paint suits, and one “suit” which consisted of nothing more than a strategically placed kayak paddle. According to Bloomberg Sports (see video report), Time Warner is using its billion-dollar Swimsuit Issue franchise as a launching pad for its new “all-access” subscription model. Here’s the bet—raise subscription prices 23 percent in hopes that subscribers (and advertisers) will buy into SI’s full range of content delivery platforms including digital, online, mobile and tablet (other than Apple-i).

Our take? Even without Apple on board, the all-access model is a good call will gain traction throughout the publishing business as some content – action sports, celebrities, how-to and yes near-naked women—is simply more compelling with audio and video streaming than words on a page. However, we don’t like the strategy of charging subscribers—and presumably advertisers, more for the privilege. It shouldn’t be treated as a premium offering so much as a must-have for any publisher hoping to survive and stay relevant 11 years into the new century.

Just as most publishers are still figuring out newsstand sales by the number of returns they receive nine months later and are still sending annoying renewal notices—rather than billing subscribers’ credit cards via negative option—they need to get out of the quaint mindset of being publishers and realize they’re competing against bloggers, social networks, software companies, mobile apps, cable companies and telecom’s for subscriber/advertiser mindshare. It’s a faster, more cut-throat game than they’re used to—with smarter, hungrier players who generally pay their staffs better to come up with ideas.

Producer price index hits highest level in 27 months

On Wednesday, the Labor Department reported that producer prices in the United States rose in January. The core index, which excludes the volatile food and energy sectors, rose 0.5 percent, the biggest jump in 27 months, the agency said. Yesterday, The Fed announced it expected economic growth of 3.4 percent to 3.9 percent this year, up from the previous forecast of 3 percent to 3.6 percent. Even Fed head Ben Bernanke said “the economy is straightening out” but joblessness could remain high for several more years as companies continue to post profits with a smaller workforce than they had before.

Brain drain on the horizon at your company?

Our take? Despite the lousy job and housing market, the latest economic growth report, coupled with the recent rise in consumer and producer prices shows we’re essentially operating in a non-recessionary climate. It’s hardly a go-go era, but essential staples for households and businesses are being purchased on an ongoing basis and of course, advertising and marketing spend will have to grow to lift demand.

Here in the B2B media business, we don’t put too much stake in the jobs reports. Our industry has always been a fluid one based on ideas and contacts—not raw output or years of service you’ve put in at the same company or government organization. We’ve always relied on a deep pool of experienced independent contractors to get things done and there’s more than enough work to go around—it just doesn’t fit into the W2+B (steady paycheck, plus benefits) hiring model.

What’s more, the lift in “intention to hire” is the biggest in 11 years according to researchers at Bernhart Associates who conducted a survey of digital and direct marketers.

As New York Times columnist Bob Herbert pointed out last week, businesses have figured out how to prosper without putting the unemployed back to work in jobs that pay well and offer decent benefits. Corporate profits and the stock markets are way up. Businesses are sitting atop mountains of cash. Put people back to work? Forget about it. Has anyone bothered to notice that much of those profits are the result of aggressive payroll-cutting —companies making do with fewer, less well-paid and harder-working employees?

Unfortunately, Bob (and corporate America), you have to look at the long-term viability of “doing more with less.” Just as your customer prospect pipeline dries up when you cut back too far on your advertising and marketing programs, too many workers who’ve been doing double- and triple-duty to hold onto their jobs during the downturn are simply getting exhausted and not seeing commensurate increases in compensation or status for holding the fort down during the depths of the recession. They’re out the door as soon as the first decent opportunity comes along. Many organizations will be facing a serious “experience vacuum” as knowledgeable workers bolt for the doors and take their smarts, contacts and ideas they were too afraid (or disgruntled to share) with them.

It will take years for the influx of newbies to get up to speed and become productive. Let’s hope you’re treating your best people as well as you can right now. Now that the economy’s on the rebound, your toughest test is yet to come. Gotta go now. They just posted behind the scenes videos about the making of the Swimsuit Issue. The Twittersphere’s abuzz with rumors of wardrobe malfunctions.

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Don’t Let the Dow and Prez Fool You. Economy’s Got a Long Way to Go

2011-01-25T09:28:00.003-05:00

But, smart B2B marketers uncover great opportunities in all economies. Let the Super Bowl, not Washington or Wall Street, guide you in 2011.

You can expect the President to put forth the rosiest picture possible in his State of the Union Address tonight as the Dow crossed the 12,000 barrier for the first time since mid-2008. Factory production, retail sales and existing home sales are rising, while unemployment claims are holding steady or slightly declining in many parts of the country.

Between standing Obama-vations from the Democratic half of the audience, The Prez will likely gloss over some persistent drags on the economy beyond the obvious “jobless recovery.” Not only is the official out-of-work rate stuck around 9.4 percent, but with the slight uptick in economic conditions, many of the long-term jobless who’ve simply given up are returning to the job search game. That will likely drive the jobless RATE even higher. Meanwhile most state and local governments are broke and won’t be able to meet their pension obligations or payrolls much longer unless they continue gouging businesses and homeowners in their districts. Many parts of Europe remain unstable, China is flirting with hyper-inflation and higher food and energy prices could throw a wet blanket on household spending.

Mind you. We’re not predicting more doom and gloom here. Just be smart, so you can make the most of this recovery. Pessimism solves nothing. Remember back in April 2009when everyone else was ducking and covering? We called the end of the recession and followed it up a few weeks later with a sunny assessment of the media landscape.

Why we’re being pinpoint bullish: Super Bowl

What we like about the financial markets this time around is that most of the run up is based on legit corporate earnings and the overall market P/E is in the teens--relatively cheap by historical standards. And then there’s the Super Bowl.

Chevy and GM are back after a two-year hiatus. As many as nine card brands may be jockeying for position to pay $3 mil for 30 seconds of your time in what’s typically the most-watched TV program of the year. We’re not so much encouraged by the game day air time as by the pre-game run up—starting up to 4 weeks out and driven by online and social media. The smart money also says to look for social couponing giant Groupon to join the fray. This could signal wide scale acceptance of the social couponing category and a possible resurgence of the IPO market.

“While we’re clearly seeing a recovery, it will be more muted than after other downturns,” Zenith Optimedia CEO, Steve King, said in a statement earlier this month. It will take until at least 2012 to match 2008 overall ad spending levels, he added. Zenith predicts Internet advertising will increase 48 percent from 2011 to 2013, followed by commercial TV, movie theater ads (+19%), outdoor advertising (+18%) and radio up 10 percent, with print advertising falling two percent.

Making sense of converging media

No one honestly knows which platform, device or gadget is going to be the true winner in this decade of media convergence. And do we really have to crown a king? Blogger Seth Godin had a nice way of sorting out the landscape in his post last week.

“I don't believe this is a winner take all situation, any more than one bestselling book makes all other books obsolete,” wrote Godin. “I think different pillars work for different devices, and there will continue to be winners in all of them.”

So look beyond the dizzying array of technology and media consumptions options we’re facing. If the intense competition for our screens, brains and wallets brings us more options with better service and realistic pricing, then we say Amen to the chaos. Bring it on.

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More tipping points have tipped as we tip a glass to 2010

2010-12-24T13:55:00.004-05:00

Online advertising to eclipse newspapers ads with video a key driver. Display closing in on paid search. Sneaky contextual ads not fooling DVR owners and liberal arts still matter for fostering entrepreneurship.

When the year-end ad spending totals come in early next month, many forecasters expect to see more dollars under the online advertising column than the newspaper advertising column in 2010 -- including advertising in newspaper online editions. Assuming these projections hold true, it would mark another major milestone for online advertising.

"It's something we've seen coming for a long time, but this is a tipping point," said eMarketer CEO Geoff Ramsey, in a statement. "Marketers are devoting bigger shares of their budgets to digital media as they see more customers shifting time toward the Web."

Ramsey’s widely cited research expects online ad spending to grow 13.9 percent to $25.8 billion, while advertisers are expected to spend just $22.8 billion on print newspaper ads -- down 8.2 percent year-over-year. Ramsey told Online Media Daily Tuesday that increased consumer use of the Web isn't the only reason marketers are putting more dollars online. "The bad economy has actually accelerated the shift to digital advertising," Ramsey said. "Online ads -- especially search ads -- are increasingly seen by many marketers as a more reliable bet than print ads, which are often difficult to tie to a measurable financial result."

By 2014, eMarketer predicts that growth in spending on online display ads will outstrip that for paid search -- although search will continue to take a greater share of dollars. This year, both search and display are on track to outpace overall U.S. online ad spending, estimated by eMarketer at just under 14 percent. The increase in display advertising will be driven partly by the dramatic rise predicted in online video advertising, set to grow by at least 34 percent every year through 2014. Banner ads will experience more moderate gains of between 7 percent and 16 percent annually, while rich media spending will stagnate.

Do Timeshifting Viewers Pay Attention to commercials in playback?

If you missed our post last week, we shared our take on the new research showing internet viewership has caught up TV. On Tuesday Nielsen trumpteted new findings trying to debunk the myth that time-shifting DVR viewers are NOT skipping through the ads. The DVR is now in nearly 40 percent of U.S. homes. As Nielsen noted, it’s a double-edged sword for advertisers. On one hand, DVRs enable TV networks to hold on to viewers who use time-shifting to watch their favorite shows when it is convenient for them and who might otherwise seek alternate ways to watch programming – or not watch at all. On the other hand, DVRs allow viewers to skip content that doesn’t interest them, including commercials, potentially undermining TV’s longtime ad-supported business model. In its latest report on DVR usage, The Nielsen Company highlighted a number of key findings, including:
• Viewers do watch commercials on their DVRs. Among DVR homes, playback lifts commercial ratings by 44 percent among 18-49s after three days. Among all 18-49 year-old viewers DVR playback adds 16% to commercial ratings after three days
• More than 38% of DVR users are over age 45.
• When DVR playback is included, DVR households watch more primetime programming than non-DVR households.
• Overall, 49% of time-shifted primetime broadcast programming is played back the same day it was recorded, and 88% is played back within 3 days.
• DVR playback peaks at 9pm and 10pm.
Download the full report DVR Use in the U.S.

Here’s our take: While it’s true about 40 percent of US homes have DVRs, and we agree with Nielsen that DVR owners watch more TV and commercials overall than they would otherwise, and the contextual ads within popular shows are getting better and more seamless. However, Nielsen found the most popular time for playback mode is 8-9pm prime time. And as Don Seaman, director of communications analysis for the media agency MPG [mpg.com] told the New York Times earlier this week, even if DVR users are theoretically watching commercials in playback mode, they’re not doing so with their undivided attention – they’re the ones most likely to be milti-taksing he said, -- texting, Facbooking etc during the commercials, using that as “down time” to do other things until the commercial is over.”

Why liberal arts still matter….entrepreneurship

If you think innovation is the province of those trained in engineering, computer science and high finance, we’d like to remind you that great ideas can come from anyone, anywhere any time, and we suggest your organization makes a full on effort in 2011 to expand its horizons beyond the Product Development Group. Peter Katopes, Interim President, of LaGuardia Community College in Queens, NY had a great Letter to the Editor in Tuesday’s New York Times that caught our attention.

Here’s the gist of it: “If it is true that the ‘jobs of the future’ will be different from those of the present and that we need the ‘best and the brightest minds’ to confront future challenges, then what could we better offer our young people than to train their minds through the liberal arts? To confront problems that have not been encountered before requires both a grounding in the past and the skills and understanding to make sense of today’s world.

As for the question of jobs, we hear much about the need for entrepreneurs in business and technology, but what we also need for future prosperity will be an entrepreneurship of the imagination, encouraged by a rigorous immersion in the liberal arts, which might lead to currently unthought-of solutions to currently unimagined problems.“
Amen Peter.

Have a safe, happy Holiday and let’s hit the ground running together in 2011.

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Internet Viewership Catches Up to TV

2010-12-17T17:51:00.003-05:00

Income still a factor in digital divide. Twitter use overstated?

While many have predicted that the Internet would inevitably become the most-watched communications medium some day, a new Forrester Research study confirms that day may be already here. The average U.S. household watches 13 hours weekly of traditional broadcast TV, equaling the same amount of hours spent online, according to Forrester. The report, released Monday, bases the findings on Forrester's survey of more than 30,000 consumers.

As you might expect, Gen Yers, ages 18 to 30, spent equal or more time with the Internet, and for the first time, Gen Xers ages 31 to 44 followed suit. Younger Boomers, ages 45 to 54, also now spend an equal amount of time with both media. Researchers said the amount of time spent watching TV has remained constant in the past five years, but Internet use has risen 121 percent since 2005.

Our take? It’s not so much the device, it’s the convenience factor of the web and the feeling of control. Consumers (and business decision makers) aren’t going to be told what to watch and when. They’ll consume it on their own terms--if you're relevant.

Look at mobile for instance. The percentage of mobile users who report texting on a monthly basis jumped from 61 percent from 54 percent, with an increasing amount of older users communicating beyond phone calls. In fact, one in four online mobile owners now log on to the mobile Internet. More than one-third of Gen Yers online mobile consumers connect at least monthly. About 200 million consumers now access their Facebook pages through a mobile device globally, according to Forrester.

The Forrester study found nearly one-quarter of U.S. interactive marketers plan to pilot mobile search programs in the next 12 months. Meanwhile, as Online Media Daily reported yesterday, the convenience of “search anywhere, anytime” has become a major attraction for mobile users. About 16 percent of online mobile users now use their mobile phone to check news, sports, or weather, and 13 percent look up directions or maps. When Forrester analyzed individuals who access the mobile Internet at least weekly, the numbers skyrocketed to 60 percent and 52 percent, respectively. Researchers indicate news, stocks and sports scores are what they’re seeking most although we suggest they’re not looking at music, event tickets and adult entertainment. Most telling for us is that the heaviest mobile users are most likely male and college-educated, and their average household income is more than $92,000.

So the web, for all its open access, democratization of the world’s information remains tilted toward the more affluent and better educated members of the populace. Internet usage still tilts toward the affluent and the well-educated.

Household income remains the greatest predictor of Internet use for Americans, according to a recent study by the Pew Research Center. In both their access to and use of the Internet and a suite of other technological devices and applications, households earning more than $75,000 a year significantly outpace lower-earning households, particularly those making less than $30,000 a year.

While 95 percent of high-income households use the Internet at home in some fashion, just 57 percent of the poorest do. The well-off are also more likely to own cellphones, computers, e-readers and other entertainment devices.

Unsurprisingly, the wealthy engage in online commerce and search for health information more often. However, while there is relatively little disparity across income brackets for consumption of television and print news sources, the richest households are more than twice as likely as the poorest to read online news.

“The correlation between income and participation in many Internet activities might be expected,” said Jim Jansen, a senior fellow at Pew. “What is surprising is the scale. It really shows the impact that income has on leveraging the advantages of the Internet.”

OMG! Who uses twitter?

A new study released this week by the Pew Research Center found that only 8 percent of Americans who were active on the Internet are enthusiastic users of twitter and only about 2 percent were extremely active/daily users. This compares to 74 percent of adult Americans who actively use the Internet. Among the highly active, they check in several times a day to see primarily what new content has been posted. As expected, the heaviest users were techies, marketers and young urbanites, but surprisingly, Latinos and African Americans were twice as likely as whites to use it – Pew did not have an explanation for that and that would sure balance the research pointing to the affluent hogging their share of the world’s bandwidth.

So, what’s all this mean for B2B marketers? It means your customers (and their bosses) need a compelling story about what makes your product/service so great. You need a story that works as well in words and pictures as it does in video form and on a mobile device. You need a story that’s stays fresh and relevant, but at the same time, can be told as well next Thursday or three weeks from today as it can right now.

Next time we’ll talk about thought leadership content that’s dynamic and real-time yet has sustainable shelf life. It ain’t easy, but what really is these days?

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Ad spending to end 2010 on uptick. Modest growth projected for 2011

2010-12-07T11:54:00.003-05:00

More ways to reach consumers. Harder to connect with them.

Up, down and sideways. How’s that for clarity? Forecasters speaking at yesterday’s UBS global media and communications conference in NYC predicted that 2010 would end with an increase ranging from 5 to 7 percent in worldwide ad spending over last year. For example, ad revenue for Time Warner's publishing unit was up 5 percent through September after declines of 10 percent and 22 percent in 2008 and 2009, respectively. The total number of ad pages industry-wide declined 1.6 percent through September after declines of 11.7 percent in 2008 and 25.6 percent in 2009, according to the Publishers Information Bureau.

Time Warner announced Monday a reorganization of its sales and marketing units to make it easier for marketers to buy across media properties and platforms. Industry wide U.S. media companies and ad companies have been benefiting from an uptick in spending on TV and Internet ads. Spending on TV ads in the U.S. is expected to climb 7.7 percent to $56.5 billion in 2010, while outlays on Internet ads are expected to grow 13.8 percent to $23.1 billion, according to Zenith Optimedia.

Spending on digital ads remains one of the bright spots in the business, ad executives say. GroupM said it expects global ad spending on Internet ads to overtake spending on newspaper ads at some point in 2012.

As for 2011, most forecasters at yesterday’s UBS media conference expected muted growth in 2011—something in the 4 to 5 percent range as there will not be a plethora of biannual or quadrennial sports/political events to give the ad economy a boost.

As Danielle Sacks noted in Fast Company recently, the explosion of search, geotargeting, the iPad, mobile apps and other platforms give marketers an unprecedented number of tools to work with to pinpoint messaging to target customers. But all those options—which we feel are still in the “experimental phase” for many media decision makers—mean more fragmented media budgets and fragmented consumer attention. Ironically, there have never been more ways to reach consumers, but it’s never been harder to connect with them.

Whether you’re a media owner, B2B marketer or analyst, here’s our take for 2011. The opportunities and dollars are out there—and so are your customers--but we’re in a very opportunistic short-term buying cycle. Customers are armed with more ammunition than ever before. They’re going to be extremely choosy before committing to “sweaty palms” purchasing decisions. As a result, we expect media buyers will be constantly tweaking and revising their budgets.

The days of the 12-month or 24-month “schedule” are fading fast in the rearview mirror. You can still get that business over the same time horizon, but you’re going to have to keep winning that business every couple of months.

If you’re in B2B then we advise you to follow the 4 Bs: Be fast. Be smart. Be agile. Be adaptable.

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Thanksgiving Food for Thought

2010-11-23T08:46:00.006-05:00

Stop your bellyaching. Reduce restrictions on education, science and entrepreneurship and let high potential startups get big fast.

If you’re going to a Thanksgiving gathering of more than three or four people this week, chances are the dinner table conversation will eventually veer toward politics and the economy. Trust us on this. The football games. All your nieces and nephews are way above average in everything they do, and Aunt Mildred’s gall bladder operation will get tiresome after an hour or so.

While your relatives are moaning about their bloated tummies and underfed 401(k)s, try this for fun. Remind them that (a) we have a lot to be thankful for and (b) economists have predicted 27 of the last three recessions and the Great Economic Disruption we’re still struggling to emerge from wasn’t technically a recession--much less a depression.

Say what?

That’s right. It’s just been a period of extremely “slow growth” according to Forbes Publisher, Rich Karlgaard’s latest blog post

Now you might get a fork in the eye from a family member who’s recently lost a job, a home, been transferred far away or been forced into early retirement. But Kaarlgard argues we’ve been so accustomed to economic growth rates of four percent or more, that when it gets down to one or two percent, it actually feels like a contraction.

Since 2008 the U.S. economy has performed slightly better than flat. In 2008, 2009 and (projected) 2010, the U.S. GDP was (and is), $14.3 trillion, $14.2 trillion and $14.6 trillion.

Experts say the American economy has averaged 3.3 percent growth annually since World War II. But even small changes in GDP cause big swings in stock market values, investor animal spirits, and consumer sentiment, says Karlgaard. That’s why 4 percent growth feels like a boom, 2 percent growth feels like a recession, and flat feels like the 1930s. Karlgaard argues that America is in a “growth recession” which is anemic growth of less than three percent, but still growth statistically speaking.

The Kauffman Foundation, says the key to getting the economy booming again is directly correlated to startups that get big.
Kauffman’s Carl Schramm has said on several occasions that “the single most important contributor to a nation’s economic growth is the number of startups that grow to a billion dollars in revenue within 20 years.” Schramm says the U.S. economy, given its large size, needs to incubate 75 to 125 billion-dollar startups per year to feed the country’s post World War II rate of growth. Faster growth requires even more successful startups.

While the strength of the Forune 1000 certainly helps the overall economy, entrepreneurship has always been the key. But, even though small business is credited with creating the bulk of new jobs, Schramm says that’s not enough either.
He says we need an “X-factor” –a hundred or so companies, per year, that launch, find a market, execute, scale, learn, adjust and sail over the billion-dollar mark within two decades. They don’t have to be Googlesque. But they’ve got to be bigger than Mom, Pop and Uncle Joe.

If we’re going to get those 100 stars to the launching pad, Schramm says we better get serious about removing the tax and regulatory barriers for these kinds of startups with the potential to scale.

For example: how about any immigrant who graduates from a U.S. university should get a green card along with his/her diploma? So should any immigrant who starts a business that grows to more than 5 people on the payroll. Ambitious immigrants, disproportionately, create growth companies.

Chances are there’s a family elder around your Thanksgiving table that fits this description. They may not know an app from a nap, but they probably had super-size helpings of courage (and cajones) and didn't stop looking for new customers and serving their existing customers just because times got tough. We guarantee you’ll learn something.

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Quantitative Easing Not Relieving Qualitative Pain

2010-11-10T09:07:00.004-05:00

But, stocks, housing, private sector jobs and Wall Street bonuses are on the rise. Financial, tech and airline sectors are rebounding with marketing dollars in tow. Why B2B marketers need to act now.

Maybe it took what the President called a good old fashioned “shellacking” of his party in last week’s midterm elections to get the Administration to see how far out of favor they have fallen from the business community, not to mention conservative and independent voters. When we say business community, we’re talking everyone from your local small businesses to the Fortune 500. Mr. Obama said he needed to "make clear to the business community, as well as to the country, that the most important thing we can do is to boost and encourage our business sector and make sure that they're hiring.”

Business runway getting longer

“The legislative uncertainty that’s kept businesses on their heels the past several years is starting to lift,” said Jeffrey Kleintop, chief market strategist at LPL Financial [www.lpl.com], whom several of us met yesterday at a financial advisor conference in New York. “The Fed’s been a little clearer about what it wants to do and that’s giving businesses a longer runway.”

As just about everyone on the planet knows by now, the Federal Reserve said it would buy $600 billion of U.S. government bonds over the next eight months to drive down interest rates and encourage more borrowing and growth. The strategy, officially known as “quantitative easing” (QE2) has had a positive effect on the financial markets, but could backfire in the long run.

If not managed carefully, the Fed’s spending spree on government bonds could be highly inflationary, since it would flood the economy with money and raise worries about too much government spending. Also, it could continue driving down the value of the U.S. dollar which gets other countries pretty pissed. Why? Because a weaker dollars hurts their exports and can spike inflation in their own countries as outside capital surges in from investors seeking better returns than they’re finding in U.S. markets. The Prez may want to wear a helmet and mouth guard to the G-20 Summit starting in South Korea tomorrow.

That said, we like E2’s chances of succeeding at this stage of the business cycle if it’s deployed gradually and intelligently – two big IFs. In addition to the impact of cheaper borrowing, higher stock prices (see below) could encourage households to spend more and businesses to invest more, and a weak dollar could make U.S. exports cheaper and thus easier to sell in normal times.

Why B2B marketers need to act now

Instead of waiting around for the all-clear signal for the government: here are some of our own leading indicators that the worst is over and now is the time to invest for the surge in consumer and B2B demand that’s likely to pass you by if you’re not ready:

Finance and tech ad rebound continues in business magazines

According to MediaWeek data released last week, ad pages in Forbes are up a whopping 353 percent from this time a year ago, Fortune is up 88 percent, Fast Company is up nearly 58 percent, Entrepreneur is more than 52 percent ahead of last year’s pace and Wired is up 11.4 percent. The leading brands depend overwhelmingly on the technology and financial services sector and generally run longer and more complex media schedules as they have to reach buyers in a long-term sales cycle with multiple purchase decision influencers to win over.

Airlines rebounding

After collectively losing $26 billion during the previous two years, according to the International Air Transport Association (IATA) www.iata.org, the majority of national and international carriers are reporting one of their most profitable quarters in years (for the 3 months ended 9/30) and they’re on track to be in the black again by nearly $9 billion. IATA says average fares for first-class and business travel within North America are up a whopping 140 percent from this time a year ago and up about 20 percent for travel to Europe. Air travel is one of the first things to go when consumers and businesses are pessimistic about their bottom lines. We’re very bullish on this trend and travel-related advertising dollars should start flowing back to leading brands in all media categories serving consumer and B2B.

Wall Street bonuses up

Investment banks and financial firms are planning to dole out larger paychecks and bonuses this year than in 2009. Top Wall Street pay consultant Alan Johnson says he expects compensation by Wall Street firms to rise 5 percent in 2010. The Wall Street Journal projected a similar rise. A recent survey of financial firms by our friends at eFinancial Careers said they expect higher pay in 2010 than they received a year ago. While the number of people working in high finance is tiny compared to the number of people working on Main Street, they account for a disproportionate share of wealth (and consumer spending) and that usually trickles down into main street as well as ad spending by Main Street-supported businesses.

Stock markets up

As of this posting, the Dow and S&P 500 are both up about 8.8 percent for the year and the broader based Wilshire 5000 is up nearly 11 percent. Investors are showing more confidence in the equity markets and have reduced their cash holdings to 17 percent from 21 percent according to a recent Capgemini survey of high net worth individuals. Add to this microscopic interest rates and the likelihood that the Bush tax cuts are likely to be extended by at least one or two more years according to LPL’s Kleintop – “it’s the legislative path of least resistance” – and you’ve got a pretty favorable equities climate.

Private sector job gain

Sure unemployment’s stuck at 9.6 percent, but while the government is shedding jobs at a disturbing clip, more private sector jobs have been created this year than during the entire Bush administration. That’s right. 2010 has had more private job creation than during the entire 8 year tenure of George W. Bush.
According to The Department of Labor, this is the ninth straight month of private sector job growth in the midst of a devastating recession that has put a serious strain mostly on the poor and middle class. There have been a total of 863,000 private sector jobs created in 2010, exceeding the total created under the Bush/Cheney regime. We don’t make this stuff up, the DOL does.

Housing

Existing-home sales rose again in September, affirming that a sales recovery has begun, according to the National Association of Realtors. Existing-home sales, jumped 10 percent to a seasonally adjusted annual rate of over 4.5 million in September from a 4.1 million in August. In a late October news release, Lawrence Yun, NAR’s chief economist, said the housing market is in the early stages of recovery. “A housing recovery is taking place but will be choppy at times depending on the duration and impact of a foreclosure moratorium. But the overall direction should be a gradual rising trend in home sales with buyers responding to historically low mortgage interest rates and very favorable affordability conditions,” he said.

Entrepreneurship

Whether or not we ever return to a 95 to 96 percent rate of “full employment,” the steady-paycheck lifestyle of a loyal employee dedicating one’s career to a single large manufacturing or corporate service entity is pretty much over.

If you’ve ever thought about starting your own business, read Seth Godin’s recent post How can you do it?!

The timing may never be better.

Remember, things were never quite as good as they seemed in the frenzied years leading up to the Great Disruption, and now they’re not as bad as the media, economists and out-of-favor politicians would lead you to believe. The time strike is while the iron’s getting hot; not when it looks, smells and feels like it really is hot. By that time it’s too late as someone else has already taken the iron and formed it into their own shape and vision.

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Device Owners More Comfortable With Mobile Advertising

2010-10-25T14:46:00.004-04:00

The corporate and affluent set use social media, but rules change when time is a more precious commodity than money. Embedded links make case studies, white papers come to life.

Late last week, the research firm Nielsen Company, released a summary version of its survey of more than 5,000 consumers who already own a tablet computer, eReader, netbook, media player or smartphone.

When it comes to advertising, 57 percent of iPad owners -- and 59 percents of connected devices users generally -- show a willingness to accept advertising in return for free access. That said, acceptance of ads should not be mistaken for engagement with ads. Almost half of iPad owners (48%) and 44 percent of connected device owners expressed a neutral attitude toward seeing ads on their gadgets. Neutral meaning that like broadcast television users, they “don’t particularly enjoy” seeing the ads, but will still tolerate them to get the content free of charge.

Neilsen researchers said iPad owners indicated a greater likelihood to engage with ads they find interesting than iPhone users or connected device owners as a whole. And it's not necessarily because of splashier ads on the tablet. For example, 40 percent of iPad users said they are more likely to click on ads that are simple text ads compared to 25 percent of iPhone and all connected device users. At the same time, 46 percent of iPad owners said they enjoy ads with interactive features versus 26 percent of iPhone users and 27 percent of overall connected device owners.
We tend to agree with Online Media Daily who weighed in: “Perhaps in part because of the novelty, iPad users just appear to be more into ads now. That translates into higher conversions. After viewing an ad, iPad users are also more likely to make a purchase either via a PC or in a physical store.”

The Affluent Like Social Media, Too

A new survey from SEI Networks found that seven out of ten people with net worth of $5 million or more are on Facebook or a similar social media site. That proportion is significantly higher than the population at large, with 61 percent of U.S. adults using social networks according to Pew Research Center.

Among the 70 percent who reported using social networks, half said they use Facebook, 37 percent said they visit YouTube, and 35 percent use LinkedIn. Researchers said the high proportion of wealth people using social media is especially noteworthy because these individuals tend to skew older than the general population, defying the conventional wisdom that older adults don't use social media as much as younger people.

Should high-end and B2B advertisers plunge into social media?

Yes and no. First of all, we think the usage of social networking may be directionally accurate, but among affluent decision makers (both at home and at their jobs) our experience is that LinkedIn (professional networking site) is probably getting much higher regular usage than Facebook and Youtube for important information exchange instead of entertainment. As SEI points out, the high penetration of social networks among the pretty rich doesn't necessarily translate into frequent use, simply because these affluent individuals often don't have the time, according to SEI. Less than one in five (17.4%) of respondents said they use social media on a daily basis, compared to 38% of the population at large. Separately, new research from Spectrem Group showed that the most popular careers among individuals heading households worth $5 million or more are senior corporate executives, business owners and physicians or dentists -- occupations which don't leave much time for idle Facebook surfing.

Digital agency Whitehorse says in a recent report that 42 percent of B2B marketers now have people working at least part time on social media activities. But, executive buy in is still lagging behind (36 percent of B2B marketers in the Whitehorse survey says there’s still “low executive interest.”

3 emerging trends in corporate use of social media

Jesse Stenchek’s Smart Blog on Social Media had a nice piece today on three emerging trends in corporate social media: reaching out to customers, remembering who’s in charge and no single department controls social media.

Embedded links make case studies, white papers come to life. Just keep em short.

Surprise findings from an Eccola Media survey of 500 B2B decision makers and influencers found that white papers and a case studies are still attracting their attention. The decrease in consumption of written content in digital form was replaced by an increase in downloading and printing of written content. By including links to media files in your thought leadership content, there’s a 93 percent chance that buyers click through and 80 percent of the time, influencers will say the media files favorably increased the value of that content.

What’s the optimal length for a white paper these days? You guessed it, six pages, not 20 and always include an executive summary. We also recommend including “key take-ways” at the begging of each chapter or section. What’s the biggest impediment to white paper adoption. “Poor writing,” according to Eccola who advises marketers to leave the technical writing to the writers, not the techies. Amen to that.

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Blackberry Enters the Tablet Fracas

2010-09-30T11:47:00.007-04:00

Battle over corporate mindshare of mobile heats up. Battle over disgruntled talent should drive corporate knowledge capture arena. Hottest areas for talent are hybrid roles that previously didn’t exist.

In case you missed it, Research in Motion, best known for its best-selling Blackberry corporate texting and PDA devices announced Monday that is has entered the tablet computer arena. The Blackberry Playbook will target corporate users (no surprise) and will get a leg up on the Apple iPad in at least one important area for business marketers – it can display Web pages that are created via Adobe Flash oftware, something that iPad currently cannot. Our prediction is this: B2B marketers will look first to reach target customers on whatever device they’re using, regardless of who makes it or how snazzy the features. The battle for the corporate share of the mobile marketplace should be a great one to watch as that will likely determine the flow of ad dollars in the B2B arena. We’re hoping for a long-hard fought battle that will raise the bar for innovation and make mobile advertising and sponsorship, a must-have on everyone’s budget by 2011.

“Take this job and shove it”…OR…”Shove that job, I’ll take it”?

Speaking of the corporate marketplace, as we mentioned last month, there’s lots of work to be done, but most organization lack the confidence to hire full-time, salaried, highly-benefitted workers to do it. Thanks, Rick Telberg, of Bay Street Group Research, who shared his take on a recent Hewitt Associates study that showed workplace tensions are at a 15-year high. Seems even those lucky enough to be employed, are running out of motivation and energy as they do two or three people’s former jobs for the same old compensation (or less).

If you’re in the career advertising or executive recruiting game, you’ll have a perfect storm of opportunity on the horizon as disgruntled workers will be jumping ship in droves as the slow recovery continues and companies will be scrambling like crazy to replace them with the long-term unemployed and underemployed. And guess who else has a great window of opportunity right now? That’s right. Those of you in the CRM, ERP, and knowledge management sector. Why? Because when long-term talented employees leave, they take an awful lot of institutional knowledge with them. It doesn’t matter how tight your confidentiality agreements are (see our Sept. 7 piece "Shot Hurd Round the Tech World").

2010 has clearly reflected a rebound for executive search in the media and marketing business, according to Ed Koller, managing partner of New York-based search firm, Howard Sloan Koller Group who shares his firm's client newsletter with us regularly. While the folks at HSK told us their data was anecdotal more than scientific, they found their clients “continue to report positive movement within their businesses, and candidates are truly excited about the energy and buzz they feel in the market and the possibilities they see ahead.” More than ever, digital roles seem focused on building innovative products, said HSK.

Here are some highlights of HSK’s latest report from the media and marketing recruiting trenches:

Companies continue to reorganize with great frequency to seek efficiencies.
• Much of the hiring is for entirely new roles -- positions which didn't exist previously, and often haven't even been thought of or planned for.
• Hybrid roles -- combinations of multiple disciplines -- are cropping up everywhere.
• Broad-based marketers are in greater demand than ever before.
• Many companies are showing increased emphasis on mobile, social media and apps, requiring a mix of specialized skills.
• Bonuses, perks and raises are still hibernating, and are likely to stay this way for the foreseeable future.
• Many candidates are (shockingly) receiving multiple offers simultaneously. "Buyers" must act quickly.
• Internal promotions and newly created roles are being used by companies as a means for retaining talent.

Our take? With digital apps improving almost daily and highly versatile “corporate decathletes” getting more responsibility instead of the politically correct org-chart-climbers, this slow painful recovery we’re supposedly in may go down as the golden age of Web 2.0 ideas, execution and positive paradigm shifts for B2B marketers.

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Shot Hurd Round the Tech World

2010-09-07T14:44:00.005-04:00

Let’s get back to selling and making things, not rules. Online video consumption surging. Adults texting too.

While the ranks of America’s long-term jobless climbs, at least one terminated white collar worker found a new home in a hurry – on Labor Day no less.

Late yesterday, Oracle announced that former HP CEO, Mark Hurd has joined the company as co-president. Despite engineering a remarkable turnaround of the company in the wake of its ill-fated Carly Fiorona experiment, Hurd was forced to resign last month after the HP board flagged him for fudging expense reports related to an extramarital affair he was having with an independent company marketing consultant/ex-adult-film actress. Nice.

While we don’t condone Hurd’s alleged actions at the helm of HP, it’s refreshing to see leading global brands recognizing leadership talent as a way to drive companies forward, not their cowardly boards or HR and legal policymakers. We think this trend will continue (albeit more quietly) throughout the ranks of corporate America.

And so naturally HP sued, according to a Wall Street Journal report.

If we’re going to get out economy out of first gear, entrepreneurs and small businesses can’t do it alone. We need the Fortune 1000 to step up too and that means bringing back people on the revenue side who actually make things (engineers, developers, content creators) and sell things (sales, marketing, business development) and start trimming back on cost-center departments that make nothing but rules (HR, legal, accounting). As perhaps a sign of the times, investors and discussion forum posters seemed overwhelmingly supportive of Oracle and anti-HP, Hurd's alleged confidentiality breach notwithstanding.

“Mark did a brilliant job at HP and I expect he’ll do even better at Oracle as there is no executive in the I.T. world with more relevant experience,” said Oracle CEO, Larry Ellison in a statement. While many in the tech world say both leaders can be difficult to work with, it’s hard to argue with their overall results. Ellison, a friend and long time business partner of HP’s, call Hurd’s dismissal in an e-mail to The New York Times “the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago.”

While Hurd’s hiring can’t be credited for a better than expected job(less) report on Friday --stocks rose as nonfarm payrolls shed 54,000 jobs last month, roughly half the 110,000 drop economists had expected and matching the level of revised losses recorded the previous month. The S&P 500 and Nasdaq Composite indices climbed over three percent for the week. Friday's employment numbers followed recent reports on manufacturing and housing that also came in above expectations, extending a notable reversal from a long string of disappointing data that had driven the Dow's biggest August drop since 2001.

Online video consumption surging

The amount of time American audiences spent watching video for the major live video publishers has grown nearly seven fold over the past year to more than 1.4 billion minutes, according to comScore. By comparison, the amount of time that American audiences spent watching YouTube and Hulu increased 68 percent and 75 percent, respectively, over the same time period. Along with Justin.tv, other top live video publishers include USTREAM, Livestream, LiveVideo, and Stickam

According to Comscore, Live online video sites have been successful in building audience and keeping that audience tuned in. The average live streamed video view is seven percent longer than the average online video view. As expected, live video sites are 72 percent more likely to deliver the elusive demographic -- males age 18-34 -- than the average online video site, says Comscore.

Experts say live streaming video’s success is due in no small part to sites' willingness to build out their technology infrastructure to provide a better user experience. For instance, Justin.tv recently announced mobile applications for Android and iOS, the former allowing users to live stream from their mobile device. The growth of broadband (both through regular and cellular networks) has made features that were unthinkable two years ago a reality today.

Adults texting too. Are you LOL? OMG!

Adults aren't as text-crazed as their teen and tween offspring, but the proportion of U.S. adults who send and receive text messages has grown from to 72 percent from 65% a year ago, according to a new Pew Research Center study on mobile use. But adults still have a long way to go to match the under-20 crowd who typically exchange 50 text messages a day compared to 10 for adults. The study found that heavy adult texters tend to be heavy users of voice calling, while light texters -- those who exchange one to 10 messages a day -- don't make up for less texting with more calling.

Voice service remains the primary cell phone function for most adults, who exchange five calls a day. Looking at how use varies by gender, the Pew report found that women make slightly fewer calls per day. More than a quarter (26%) otf men send and receive 6 to 10 calls a day, while 20 percent of women exchange that many calls.
A recent Nielsen study found that women on average spend 22 percent more time talking on cell phones (856.3 minutes a month compared to men's 666.7). In terms of behavior, women are slightly more likely to place frequent calls to just say hello and chat and report on where they are or find out where someone else is. Men are more likely to make calls about coordinating where to meet others, and to exchange calls about work. Both men and women were likely to have long conversations to discuss important personal matters on the cell phone.

If you’re still wondering whether mobile should be part of your 2011 marketing mix, we suggest you check out these and other reports from reliable independent sources. Now get back to work and reach out and touch your customers.

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When the Going Gets Tough, the Tough (and Smart) Get Going

2010-08-23T11:48:00.001-04:00

Disappointing news on jobs, manufacturing and financial markets are no reason to throw in the towel or cut spending plans. Bankers got us into this mess. Tech will get us out.

Stocks sank late in the week on discouraging news about jobless claims and manufacturing data. Housing prices aren’t going anywhere and warnings of a “double dip” recession are as numerous in the media as references to the “slow economic recovery.”

From a macro and consumer-centric view things look pretty lousy. Unfortunately, that’s overshadowing some optimistic signs in the big business world that we think will eventually spill over into hiring and consumer confidence.

Bottom line. Now’s not the time to duck and cover on your hiring, marketing and infrastructure improvement plans. It may be the best opportunity you’ll have in a long while to get affordable talent, media exposure and the tech foundation you’ll need to hit the ground running when government officially calls this prolonged economic downturn over.

Just as you have to hit your Refresh button on your Web browser from time to time, we think the economy, led by big business, its hitting its collective Refresh button and the smart ones are positioning themselves to ride the inevitable wave of pent up demand that’s coming.

General Motors is planning and IPO. Yes the same GM that accepted a humiliating $50 billion government bailout during the depths of the financial crisis is about to become a public company again and no doubt leaner and more globally competitive. Intel announced plans to acquire McAfee and Dell agreed to acquire 3Par. These moves – and an overall uptick in deal activity last week – dovetailed with our point made last time in this column that the surge in tech spending by companies and gadget spending by consumers will get the cash registers ringing again.

The latest surge in M&A has spurred hopes that companies will use the $2 trillion of cash sitting in their coffers to make deals and grow their businesses. "This is a logical thing to have happen," Dick Del Bello, senior partner at Conifer Group, told The Wall Street Journal late last week. "Companies are sitting on piles of cash and they're trying to find ways to take advantage of that without increasing their risk profile dramatically."

We also found two more bright spots in the tech sector – Dell’s and HP’s ability to shake off highly publicized CEO scandals (accounting fraud and sexual harassment, respectively) without noticeable damage to earnings and brand equity. HP reported Thursday that its Q3 revenue rose 11 percent to $30.7 billion from a comparable period a year ago. Dell’s Q2 revenue came in at $15.5 billion, a 22 percent jump over its Q2/09 period.

If you’re like most businesses, you’re experiencing what the PC market is going through. You’re in the throes of great change. Pent up demand from new and existing customers is starting to emerge -- Dell said its notebook sales were up 21 percent and desktop sales up 17 percent, while HP reported a 17 percent overall increase in computer sales – but both companies know that growth trend isn’t guaranteed for long.
Chances are your business isn’t that much different from Dell’s and HP’s. You’re facing new competition on at least two fronts -- global competitors who weren’t sniffing around your market as much before the downturn, as well folks who weren’t in your competitive space before the meltdown, who now smell opportunity on your home turf.

As the tech guys know, overall demand for their stuff is higher than it’s been for a while, but now Acer, Asustek and other Asian competitors are breathing down their necks for control of the U.S. desktop and notebook market while mobile phone makers and carriers aggressively moving into the tablet market. They’ve got to hold onto their longstanding turf while innovate faster in their new turfs. Sound at all like your business?

That’s where smart advertising and marketing comes in. Reinforcing your brand superiority in longstanding markets and bolstering your brand position in your newer markets. Maybe it’s no surprise that technology companies accounted for nearly a third of the top 50 most valuable brands, according to a recent Forbes/Mindshare study. The rankings looked into each company’s brand earnings over the past three years, subtracted capital employed and then took a percentage of earnings based on the role brands play in each industry. The study authors also factored in the parent company’s P/E multiple to the net brand earnings number.

Apple, Microsoft, IBM, Google, Intel and Nokia made the top 10. They may have cut way back on their ad pages, direct mail and network TV buys, but they’re finding new and innovative ways to catch the pent-up demand wave as B2B and consumers collectively gain the courage to hit their “Refresh buttons.” We’ll talk more about their credibility marketing next week.

In the mean time, maybe it’s time you re-familiarized yourself with the Refresh button at the top of your psychological Nav bar. And clear out your cache and junk folder while you’re at it. As we mentioned last time in this blog, August is the new September, and 2011 is the start of the New Normal era.

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Accelerating in a stalled economy?

2010-08-09T07:35:00.005-04:00

HP likely to be Hurd-ing for a while, but business spending on equipment and software among few bright spots in sluggish new economic report. Companies investing for the future, but spending more on infrastructure than on people. Are you seizing the day or still hunkering down?

I ran into a neighbor of mine on the beach yesterday who thought I still toiled for a high brow financial publication. “So are we out of this thing or not?” he asked me, after mentioning his plans to subdivide his property and start building on both lots – both “scaled down” versions of his current abode. He’s a teacher at an upscale private school and his wife works in a stable healthcare organization. So while neither occupation is as “recession-proof” as they’ve led themselves to believe, they’re feeling pretty good about life right now.

“How the heck should I know if we’re out of this economic S--storm?!” I thought to myself, since nothing I could say was going to dissuade him from his renovation plans. But, then thought I better respond with something a little more scholarly in case anyone else was listening in. I took a deep breath, admired the sailboats and kayaks frolicking on the water and came up with this pearl of wisdom: ”It all depends,” I said. “Depends on what?” he replied, with some impatience.

I said it depends on whether you think things are getting better or whether you think things are getting worse. Overall personal incomes dropped nearly two percent last year, according to US Department of Commerce stats and my neighbor and I live in one of the five wealthiest -- but hardest hit metro areas in the country (see stats)

My neighbor's obviously pretty optimistic about the future and that’s my point. He may not be earning a king's ransom, but his kids go to an elite private school for free. He's got summer's free, doesn't commute far and his wife's doing well, too.

People and companies who think things are getting better are hitting the ground running with expansion plans, they’re hiring, they’re pulling the trigger on delayed purchases, refinancing their mortgages etc. with the thought that “things may never be this cheap again for a long, long time.”

At my neighbor’s elite school, he said they haven’t lost a single family during the recession, “but they’re sure re-thinking that country club membership.” At the other end of the spectrum, we know have close to 2 million people going on 99 weeks of unemployment benefits and that’s not counting the discouraged, early retired, independent contractors, etc. which is probably three to four times that number.

Switch gears to Middle America. WalMart’s still doing well (Net sales for the first quarter of fiscal year 2011 were $99.1 billion, up six percent from a comparable quarter last year), but Nascar events that continually sold out in the middle of the decade drone on in front of acres and acres of empty seats. Nielsen says Nascar’s TV ratings are down 25 percent 2005 Nascar merchandise sales are down 23 percent from its 2006 peak according to The Licensing Letter. Consumers saved a whopping 6.4 percent of the after-tax income in June, according to a new report. It was one to two percent before the recession, and for most of the Baby Boom generation’s adult lives.

They don’t see any improvement from September 2008, when most folks think we officially went into the tank, and they’re hoarding cash like there’s no tomorrow. Millions of homeowners would unload their homes tomorrow if anyone would actually buy em. Millions of employees still lucky enough to have their jobs are fed up with being paid the same as they were five years ago, despite handling double the workload and three times the stress. They’d leave in a heartbeat if there was anywhere else to go.

So it all depends on whether you think things are get better at a better rate, or things are getting worse at a worse rate.

On Friday, HP’s remarkable turnaround was derailed temporarily by sexual harassment allegations against CEO, Mark Hurd. The company’s stock price took a 10 percent hit on the news, but the company will find a way to shake it off, stay focused and get back on track in the same matter of fact way it issued Friday’s press release about Hurd’s termination.

Outside the corner office, the U.S. economy lost 131,000 jobs in July, but that number was distorted as the government let go 143,000 temporary Census workers during the month. The more closely watched private payrolls numbers were also disappointing, showing just a 71,000 increase, less than the 100,000 that economists expected. To make matters worse, the June data were revised lower to a loss of 221,000 jobs from a previously reported 125,000. But the official unemployment rate improved to 9.5 percent, which is a few ticks less pathetic than 9.7 percent last month.

Great. So, things really are improving you say? Not so fast.

Ben “the Bummer” Bernanke, said last Monday that while the U.S. economy continues to grow at a moderate pace – 2.4 percent in Q2, down from 3.7 percent in Q1 -- significant restraints remain on the recovery. In prepared remarks, The Fed Chairman said the U.S. had a "considerable way to go to achieve a full recovery in our economy, and many Americans are still grappling with unemployment, foreclosure and lost savings."

Companies spending on equipment, processes – not people

But, the government report showed a bright spot continuing in the economy: the growth of business spending on equipment and software. This spending continued to surge, increasing by 21.9 percent in the second quarter, compared with a 20.4 percent rise in the first three months. The figures highlight the contrast in the economy between high company profits and a persistently feeble jobs market keeping consumers at bay.

Many management and turnaround consultants I’ve talked to said business has never been better. And if you’re selling productivity tools and processes, things are looking pretty rosy too. So if you’re in the business of helping organizations do more with less – you’re liking this long-term state of flux and uncertainty. But, if you’re trying to get in, stay in or sell to an organization who’s trying to do more with less, than it’s kind of a sucky time.

So if you’re trying to reach B2B decision-makers then we recommend you hit it as hard as possible right now as we’re about to enter the Q4 selling season. There could be several years of pent up demand unleashing itself between now and year-end and you don’t want to be kicking yourself this time next year wishing you had made one more phone call to that VP or Purchasing, or sent one more e-mail blast to that Sr. Manager of Technology or tried one more time to get that white paper over to the Web marketing manager who asked for it two months ago, even though they said budgets were frozen? And what about that Webinar you scrapped mid-summer, because you thought too many thought influencers would be out of the office? Could you have just blown a chance to make the sale of the year in order to save a few bucks in your marketing budget?

When it comes to long-term purchase decisions, you never know if it's six time you touch a prospect, the ninth time or the 12th time that will do the trick.

If things are so bad, then how come business magazine ad pages are up 40 percent at Forbes from this time a year ago (Source; Mediaweek or 36 percent at Wired or 33 percent at Inc?

As we’ve been trumpeting all summer, we’re fast approaching the tipping point in which the “Opportunity Seizers” will be zipping past the “Hunker Downers” and the “Shoulda-Woulda-Coulda’s.”

Which train will you be on?

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‘Unusually Uncertain’

2010-07-22T10:10:00.002-04:00

Investors think F-word after Bernanke’s U-word(s). Have changing demographics of U.S. workforce accelerated importance of social networking and communication skills?

A minute in to his semi-annual testimony before Congress yesterday, Fed Chairman Ben Bernanke sent the stock market into an afternoon slide (down 1.3 percent) with two simple words that underscored the fragility of investor and business community confidence…. “Unusually uncertain.”

“Of course, even as the Federal Reserve continues prudent planning for the ultimate withdrawal of extraordinary monetary policy accommodation, we also recognize that the economic outlook remains unusually uncertain,” said the Fed Chief. Bernanke’s comments followed discouraging data on housing, unemployment, consumer sentiment and bank lending, not to mention uncertainty over the effect of the sweeping financial legislation signed by President Obama yesterday.

Marketing for decision-makers in the post-industrial economy

As NY Times columnist, Nicholas Kristof, points out today for the first time in American history, men no longer dominate the labor force. Not only do men account for about three-quarters of Americans who lost their jobs, during this prolonged recession, but women are now the majority of payroll employees for the five months that ended in March, according to one measure from the federal Bureau of Labor Statistics.

Citing, Atlantic Monthly’s Hanna Rosin, Kristof raises the question: “What if the modern, postindustrial economy is simply more congenial to women than to men?” As both columnists observe: Our postindustrial economy is indifferent to men’s size and strength. The attributes that are most valuable today — social intelligence, open communication, the ability to sit still and focus — are, at a minimum, not predominately male. In fact, the opposite may be true.

Read for yourself to see if you agree whether the female gender’s superior social/communication skills are socialized or a result of different genetic wiring between the sexes. But for marketers intent on reaching corporate decision-makers and influencers, the importance of listening, social networking and open communication should not be underestimated.

It’s not necessarily a gender issue, but it’s hard to argue that more and more of us are selling to a group of decision-makers instead of a single buyer, and that group of buyers is soliciting feedback from a wider range of influencers than ever before. You simply cannot take that many influencers out to the golf course or a nice dinner if you want the business. Social media is no longer a nice-to-have. It’s a need to have form of air coverage if you want to stay on the radar of your current and prospective clients with an ongoing, meaningful two-way dialogue that can be shared, linked and vetted.

VCRGD6XDXT3T

Business Marketers at Mid-Year Crossroads

2010-07-01T13:43:00.003-04:00

Fast your seatbelt. No matter how the second half ends up, it won’t be boring. Banners battle video and search for control of digital ad budgets.

The July 4th Holiday weekend is typically when we take time out for a breather from the frenetic pace of daily life to hit the beach, the mountains or just the backyard hammock for a little R&R and some good old fashioned pyrotechnics. It’s also a typical juncture in the business world as we try to decide whether we’re going to have a good year or not and start fretting about the 2011 budget.

I spoke the other day with John Graham, President & CEO of the American Society of Association Executives who said we live in an instant gratification “experience economy.” Consumers don’t want to have marketing messages pushed at them so much as they want to control the dialogue with your organization. It’s all about “I want what I want when I want it and how I want to get it,” related Graham.

So what do they really want? “Truth in advertising,” said Graham. “You need to earn their trust,” and thanks to social media, they have more tools than ever for punishing you for not delivering.

Second half forecast?

All signs point to “not clear.”

The financial markets have recently given back all their gains for the year – end then some. A stream of reports released this week pointed to slowing growth throughout the economy, from slower manufacturing growth to higher claims for jobless benefits and declines in home construction and pending sales. U.S. factory activity slowed in June amid a moderation in inflationary pressures. Private research group the Institute for Supply Management reported Thursday that its manufacturing index for the most recent month moved to 56.2, from 59.7 and 60.4. Readings above 50 signal expansion, so June's reading represented continued growth at a slower pace. Economists had expected to see slight moderation at a reading of 59.0.

Persistently high unemployment, modest gains in overall output, when added to weakness in housing and the threat posed by weak growth and financial problems in Europe, have driven up fears about what lies ahead for the U.S. recovery. Also, in the U.S. labor market, the four-week moving average of jobless claims -- which aims to give a better idea of the trend by smoothing volatility in the data -- went up by 3,250 to 466,500 in the week ended June 26. That represents the highest level since March 6, 2010.

Experts say compared to past recoveries from deep recessions, the current one is moving slowly. The economy expanded by less than an annualized 3.0 percent in the first quarter and there are increasing concerns that growth may slow down in the second half of the year. U.S. consumer confidence fell sharply in June, wiping out the gains posted in the previous two months as Americans worried about their job prospects. Some economist fear consumer spending won't be strong enough to replace a fading government stimulus in lifting the economy.

The June Consumer Reports Trouble Tracker Index measuring financial difficulties faced by consumers in the past 30 days, worsened, rising to 63.5 from 53.0 in May. The most troubling increase is in missed mortgage payments, which reached 3.9 percent, its highest level since tracking began in April 2009. The latest numbers show consumers have taken a step back facing increases in financial difficulties and a soured employment picture, says the report.

In June, more consumers reported difficulty in affording medical bills or medications versus the prior month, and faced lost or reduced healthcare coverage
• The Employment Index has dropped, pointing to an increase in the ranks of the unemployed, at least temporarily. The decline was led by the proportion of Americans that lost their jobs in the past 30 days
• Despite the high job losses posted in June, 7.4 percent of Americans reported starting a job in the past 30 days, well above May, and achieved its highest level recorded since April 2009.
• Consumers have scaled back their interest in shopping as well. The past 30-Day Retail Index for June, reflective of May activity, is 10.8, unchanged from the prior month
• May's next 30-Day Retail Index, reflective of planned purchases for June, is down slightly from the prior month. Per capita spending for the index categories in the past 30 days was $234, down slightly from May ($248)
Consumer Sentiment is unchanged from the prior month. The most optimistic consumers are between the ages of 18-34 (52.3), and with a household income of $100,000+ (54.9). The most pessimistic are households with an income less than $50,000 (39.2) and Americans 65 or older (41.7).

The Sentiment Index captures respondents' attitudes regarding their financial situation, asking them if they are feeling better or worse off than a year ago. When the index is greater than 50, more consumers are feeling positive about their situation. When it is below 50, more consumers are feeling worse.
The Trouble Tracker Index addresses the proportion of consumers that have faced difficulties and the number of hurdles they have encountered. This index has shown a significant increase this month, pointing to more troubles for consumers, rising to 63.5 in June from 53.0 in May.

Banner Ads Still Relevant?

In surveys, consumers will tell you they ignore static banner ads, and don't click on them. But eMarketer Senior Analyst David Hallerman cites stats from a Microsoft Atlas study that animated .gif display ads running across the tops of Web pages still influence purchase decisions.
Hallerman, who has been researching a report about online brand marketing, calls banner ads "somewhat subliminal" because banner ads appear to affect consumers whether they realize it or not. "The positive, yet not always easy-to-measure effects and the increasingly lower cost and availability of banners give campaigns a steady foundation," reports Hallerman. "Banners help to fill in the campaign."
As marketers look to engage consumers -- and to gain better measurement and targeting tactics than what's available with most other media -- they will continue to increase budgets for Internet ads of all kinds, most likely at the expense of newspapers, magazines and other traditional media. Forecasters we typically cite in this blog expect the Internet's share of total media ad spending to rise from about 15 percent in 2010 to more than 20 percent in 2014.

The power of video

A large part of the growth will come from video, even in banner ads. Spending for online video advertising will make the format the second-biggest recipient of new ad dollars from 2010 to 2014, according to the eMarketer report "U.S. Ad Spending: How Big Is the Bounceback?" Of the more than $13.6 billion incremental dollars that will flow into online advertising during the next five years, one third (33%) will come from video ads, compared with 44.5 percent from search.

As search attracts more dollars and video gets more growth, experts say banner ads will increasingly become filler for those two ad formats, as well as for other elements of advertising campaigns. And as the market share for banner ads continues to decline -- even in 2014, when spending on banners will make up just one-fifth of all the ads on the Internet -- the format will remain strong.

I wish I had more direction for you. Just stay smart. Keep holding your breath. We’re either going to have a sparkling second half or a wet fuse dud. The winners will be those who are most able to adapt to adapt to the changes the new world order throws at them.

VCRGD6XDXT3T

Survey Indicates Business World More Complex Than Ever

2010-05-29T21:54:00.004-04:00

Creativity and innovation the keys to business survival. Heed economic indicators, not schizophrenic stock market. Five keys to a real-world business plan.

U.S. financial markets continued their slide, hampered by uncertainty over how tough U.S. regulators will get with Wall Street speculators and how many blue-chip financial institutions may get sucked into the mounting European debt crisis. The key word here is “uncertainty” not actuality.

In the real world, consumer confidence is rising as the job market and housing front continue to improve. On Tuesday, The Conference Board said its Consumer Confidence Index rose to 63.3 points, up from 57.7 points in April. The index got a boost from the six-month consumer outlook which jumped to 85.3 from 77.4, the highest since August 2007. A reading of 90 indicates economy on solid footing, 100 means growth. Index hit a record low of 25.3 back in Feb 2009. Home sales were better than expected in April. Existing home sales were the highest in five months according to National Association of Realtors (NAR) and median home prices rose for the second straight month, 2.1 percent in April despite an 8-month inventory on the market. And ad spending continues to rebound as researcher IDC projected U.S. online ad spending to shoot up 12.6 percent by end of 2010, it has now raised that number to 19 percent to $31.5 billion. The change follows a string of surprisingly strong numbers for all segments of online advertising, even display, which had been in decline for the past two years. Last week, the Interactive Advertising Bureau said internet ad spending rose 7.5 percent in Q1 to $5.9 billion.

Creativity key to corporate survival

A newly released IBM study of 1,500 CEOs found that 79 percent expect increased global complexity and only 49 percent feel prepared to deal with it. The IBM study was based on face-to-face interviews with leaders of all size companies in 33 industries and 60 companies.

Surveyed execs identified “creativity” as the single most important leadership competency for enterprises seeking a path through this complexity. How so? Creative leaders expect to make deeper business model changes to realize their strategies. To succeed, they take more calculated risks, find new ideas, and keep innovating in how they lead and communicate.

CEOs now realize that creativity trumps other leadership characteristics. Creative leaders are comfortable with ambiguity and experimentation. To connect with and inspire a new generation, they lead and interact in entirely new ways. CEOs saw the need to seed creativity across their organizations rather than set apart “creative types” in siloed departments like product design. To benefit from the diversity of ideas each employee can contribute. Standouts encourage a new mindset of questioning. They invite employees at all levels to challenge assumptions based on past experiences and scrutinize “the way we’ve always done things.”

Our take? Great ideas, but a commitment to creativity and agility is more easily said than done when you factor in quarterly analysts and shareholder pressure and a hyper-paranoid workforce that’s scared to death of having a mistake pinned on them.

5 keys to a real world business plan

According to blogger, Seth Godin, the traditional corporate or venture capital-seeking business plan is a croc.

“If I want the real truth about a business and where it's going, I'd divide the modern business plan into five sections,” quips Godin:

1. Truth
2. Assertions
3. Alternatives
4. People
5. Money

The truth section describes the world as it is. Tell me about the market you are entering, the needs that already exist, the competitors in your space, technology standards, the way others have succeeded and failed in the past. The assertions section is your chance to describe how you're going to change things. We will do X, and then Y will happen. We will build Z with this much money in this much time. The alternatives section tells me what you'll do if that happens. How much flexibility does your product or team have? If your assertions don't pan out, is it over? The people section rightly highlights the key element... who is on your team, who is going to join your team. 'Who' doesn't mean their resume, who means their attitudes and abilities and track record in shipping. And the last section is all about money. How much do you need, how will you spend it, what does cash flow look like, P&Ls, balance sheets, margins and exit strategies.

Cell phones use more for data than calls

CITA, the wireless industry association reported last week that the amount of data in text, music, e-mail and other activities surprassed voice calls on mobile devices in 2009.

According to comScore, total cell phone subscribers from 2009 to 2010 is about the same, but the number of users going online is up across almost all Web categories. Visitors to social networking sites like Facebook and Twiter increased 78 percent. Many more users are going to reference site like Answer.com or wiki, up 46 percent and banking sites up 45 percent.

Top categories for browsing on mobile devices

1. Search 32.1M users +36%
2. Social networking 27.3M users +78%
3. Weather 26.1M users _+ 21%
4. News 24M users +29%
5. Sports info 19.7M users +25%

Don’t be fooled by the schizophrenic stock market. This recovery – no matter how fragile – is the real deal. Today’s market leaders are the ones who’ve had the pedal to the metal since the depths of the recession, not the “duck and cover” crowd. Agility, creativity and the willingness to make mistakes (and learn from them) will guide you through all types of water, no matter how turbulent.

VCRGD6XDXT3T

Markets and Economy Slog Through Fortnight of Tests

2010-05-12T09:01:00.004-04:00

New research points to impact of social media and ‘digital natives’ on your brand.
Despite last Thursday’s stomach churning “flash crash” in the financial markets, most U.S. stock indices are clawing their way back to positive territory for the year. This resiliency, in the face of the European debt crisis, the Time Square Bombing, the Staten Island Ferry crash, the BP/Gulf of Mexico oil spill, flooding in the South and tornados in the Midwest, is encouraging.

U.S. payrolls rose by nearly 300,000 in April, the largest monthly jobs gain in over four years. Most experts are ignoring the fact that the squishy “official” unemployment rate rose to 9.9 percent from 9.7 percent. Experts say it’s a sign that once-discouraged Americans have returned to the job market – not a deluge of layoffs from corporate America.

The construction and manufacturing sectors also showed signs of life in the latest economic report, raising hopes of an improving job market. The Institute for Supply Management Monday said the manufacturing barometer had improved 60.4 percent in April, the highest level June 2004. A Commerce Department report said consumer spending rose 0.6 percent in March – the largest increase in five months and households saved less, socking away 2.7 percent of their income in March down from 3.0 percent in Feb. Again, we see the gradual reduction in consumer savings as a confidence indicator, not a return of the conspicuous consumption that marked the latter part of the previous decade.

Is the worst over?

“The worst of the economic impact on Internet advertising is over and the seeds of growth have been planted,” said PricewaterhouseCoopers’ David Silverman in a statement following the release of a new study his firm did in conjunction with the Interactive Advertising Bureau. Forrester Research, Zenith Optimedia and other media forecasting groups have generally revised their 2010 and 2011 ad spending projections favorably in recent months, with most of the upside going to growing sectors (Web, online video, social media, television, outdoor) with a modest slump to continue in out of favor sectors (newspapers, magazines and radio).

Social media and your brand

Though slightly more than 50 percent of regular users never post status updates on Twitter; 70 percent do so on social networking sites like Facebook. Experts say Twitter acts more like a broadcast medium than Facebook does, but users are more than three times as likely to follow brands and companies on Twitter as others users of social networks do, with over 40 percent using Twitter to learn about and provide opinions on brands, according to a recent Edison Research study.

So will social media deliver measurable results for marketers? Well, more than half of marketers surveyed by Datran Media in its fourth annual Marketing & Media Survey say they’re confident it will, and only one in eight (12%) say they’re confident it won’t deliver results. Researchers said social media continues to be a wildcard, but it’s getting easier to measure the impact of a tweet or an update on LinkedIn on the final conversation.

Social media is not as effective at building search engine rankings as it is for building brand awareness and reputation, says a recent Marketing Sherpa study of over 2,000 marketers.

Social media IS effective for:
• Increasing brand or product awareness 49% agree
• Increasing brand or product reputation 45%
• Increasing public relations 43%
• Increasing Web site traffic 41%
• Improving search engine rankings 35%

The future?
Anti social networking of teens, i.e. your future consumers

Last week, the Pew Research Center found that half of American teenagers — defined in the study as ages 12 through 17 — send 50 or more text messages a day and that one third send more than 100 a day. Two thirds of the texters surveyed by the center’s Internet and American Life Project said they were more likely to use their cell phones to text friends than to call them. Fifty-four percent said they text their friends once a day, but only 33 percent said they talk to their friends face-to-face on a daily basis. The findings came just a few months after the Kaiser Family Foundation reported that Americans between the ages of 8 and 18 spend on average 7.5 hours a day using some sort of electronic device, from smart phones to MP3 players to computers — a startling number,

The question on researchers’ minds is whether all that texting, instant messaging and online social networking allows children to become more connected and supportive of their friends — or whether the quality of their interactions is being diminished without the intimacy and emotional give and take of regular, extended face-to-face time.

Gary Small, a neuroscientist and professor of psychiatry at U.C.L.A. and an author of "iBrain: Surviving the Technological Alteration of the Modern Mind," said in a New York Times interview that so-called “digital natives,” a term for the generation that has grown up using computers, are already having a harder time reading social cues. “Even though young digital natives are very good with the tech skills, they are weak with the face-to-face human contact skills,” he said.

While many parents and educators fret that the ease of electronic communication may be making teens less interested in face-to-face communication with their friends, we think marketers and employers need to adjust their communications strategies for the crowdsourcing nature of today’s digital natives.

Will young people still be able to sell and communicate?

“Teaching new sales people how to ask good questions and how to listen and keep the intelligence gathering dialogue going in a face to face setting is an absolute ssential,” said Eric Wynne, President of Wynne Media Company in a recent panel discussion I moderated. “It doesn’t come naturally to many of them as they’ve been attuned to communicating by screen in a very truncated fashion.”

Molly Sargent, Principal of Professional Impressions Consulting concurred. “Younger sales people just haven’t been trained the right way. You can’t just do your due diligence on the Web. There’s more to researching a company than Google and Hoovers. They’re not trained in how to pick up the phone, how to ask those critical questions, how to find the internal champion, how to sleuth ahead of time before the call.

At the end of the day, people want to do business with people they like and trust. With all the new technology tools available for reaching, tracking and micro-targeting our prospects, let’s not forget the most important part of selling and marketing successfully -- human interaction.

VCRGD6XDXT3T

It’s Official. Internet Ad Revenue Surpasses Print

2010-04-26T11:21:00.007-04:00

Keep your eye on digital video and rich media.

The tipping point has finally tipped. Marketers spent more on Web advertising in 2009 than they spent in magazines according to a new ZenithOptimedia report. Zenith researchers predict that online ad spending – now the third largest advertising medium – is rapidly closing ground on newspapers, too. Cynics will point out that online advertising revenue actually declined 3.4 percent in 2009, the first year-over-year falloff since 2002 and it would have been worse, had it not been for a record-setting $6.3 billion fourth quarter. But, the loss in ad spending across all media sectors was quite a bit worse -- 12.3 percent for the year and two percent for Q4.

For some perspective, consider that 2009 ad revenue at major magazines plunged to $19.5 billion (minus 17.5%), according to Publishers Information Bureau (PIB) data and PIB reports ad pages are down another 9.4 percent for the first quarter of 2010. Fortunately for publishers, a share of those missing ad dollars are “migrating” to publishers’ Web sites and other digital properties, but the media landscape has now changed to the point that the heady days of “buy or audience, let’s go have lunch” are barely visible in the rear-view mirror.

Keep your eye on digital video

The Interactive Advertising Bureau and PricewaterhouseCoopers recently reported that search ads posted a slight uptick from 2008, accounting for nearly half (47%) of all Internet ad spending. Display ad spending rose a similar amount. Revenues for online classifieds and e-mail advertising plummeted, but digital video ads climbed an astonishing 38 percent. Thanks mainly to search, display and video, eMarketer predicts that online ad spending will grow a healthy 5.5 percent this year, to $23.6 billion and will increase its share of the overall ad pie to 17.1 percent in 2012 from 12.6 percent today.

When it comes to online ads, it pays to get moving
Rich media ads outperform standard banner ads

If you use banner ads for marketing (or sell them to your clients), consider adding rich media to get more bang for your online buck. Here’s why. According to new findings from research firm eMarketer Web users were more than 2.6 times as likely to click on a rich media ad than they were on a static banner, and conversion rates were also up, by 198 percent, eMarketer said.

As we’ve mentioned numerous times in this blog, video is growing by leaps and bounds on the Web because consumers want to view a story rather than read it. It doesn’t matter whether you’re selling hammers, airline tickets or multi-million dollar enterprise resource planning software. You’ve got to show it to sell it.

Organic search results still generate 7 out of 8 clicks online

A recent Marketing Sherpa study shows conversions for organic (i.e. natural, unpaid) search results still outperform others. Why? Because researchers say prospects trust organic search results more than they trust paid, or guided-pay, search results. You can buy the space to reach target customers, but you can’t buy their trust. Like all entrée’s on the savvy marketer’s menu, paid search deserves a seat at the table. But if feel your diet is heavy on search just because it’s cheap, then you need to re-think your marketing strategy and overall value proposition.

Conversion Rates
Organic search*************7.2%
Shopping engine********6.6%
Pay per click*******5.0%
OVERALL************6.1%
Source: MarketingSherpa.com 2010

B2B sales pros increasingly turn to LinkedIn

Companies are relying more and more on their corporate Websites and social networking to bring in customers, according to new research from eMarketer. Social networking, while still gaining adoption at many organizations, recently passed direct mail and Webinars in terms of generating qualified leads for business and professional organizations. As of late March, social networking was closing in on live events and trade shows for lead generation.

The most effective social network for prospecting, says eMarketer, was LinkedIn, by a wide margin. The business-oriented site was rated 3.1 out of a possible 5, compared with ratings of 2.0 for blogs, 1.9 for Facebook and 1.8 for Twitter.

Research firm, Outsell sees it a little differently. A recent Outsell poll found that B2B marketers in the U.S. considered Facebook the most effective social media site, at 51 percent, followed by LinkedIn (45%) and Twitter (35%). That poll focused on effectiveness in general, not necessarily lead generation.

LinkedIn’s effectiveness in this area has translated into significant increases in usage. Nearly half of respondents (47.8%) told eMarketer they were using the site more for prospecting and research than they were a year ago. Around one-fifth of those polled were also upping their prospecting efforts on blogs (21.8%), Facebook (20.8%) and Twitter (17.3%) and one in 12 (8.4%) on YouTube.

January 2010 data from HubSpot showed nearly half (45%) of North American B2B companies using LinkedIn for marketing had acquired a customer through the site. Company blogs were effective for 43% of respondents, while 38% and 33%, respectively, got customers from Twitter and Facebook.

Macro-economy: cautious optimism becoming more optimistic than cautious

We’re not commenting on the overheated stock market today. More on that next week. Meanwhile, government data released Friday showed a nice increase in big ticket manufacturing items. Sales of new homes surged 27 percent in March. Despite persistent long-term (26+ weeks) unemployment, households are replacing cars, upgrading home furnishings and stocking up on gadgets. Many economists estimate that consumer spending — which makes up some 70 percent of American economic activity — jumped by four percent during the first three months of 2010, which was about twice as fast as the experts anticipated.

Our view is that month and months of pent up consumer and business demand will finally be unleashed sometime after mid-year. Technology companies are reporting strong sales and earnings. Intel (www.intel.com), reported its highest first-quarter revenue in history. Google (www.google.com) added about 800 jobs this year, and Amazon (www.amazon.com) has added 1,800. Manufacturing is slowly adding jobs. Retail sales surged 9.1 percent in March according to Thomson Reuters, marking the seventh consecutive month of growth. And U.S. exports are running about 15 percent ahead of last year, according to the Commerce Department.

OK. The wet blankets who compile The University of Michigan Consumer Sentiment Index said their benchmark plunged to a preliminary level of 69.5 in April compared with 73.6 in March. But that’s better the record low of 55.3 back in November 2008. And the American “savings rate” (long considered an oxymoron) climbed during the recession but has recently fallen, according to an analysis of Federal Reserve data by Economy.com. We view that as a sign of confidence, not recklessness.

Victor Ghassemi, sales manager for a Los Angeles Porsche dealership may have summed it up best in a New York Times interview today. “People get tired of holding on to their money, or just sitting at home and not doing anything,” he said. “People love to shop. And you take that privilege away from somebody, it lasts about a year. Eventually, people want to come back. They want to buy new merchandise, a new product, to make them feel really good about themselves.”

Victor, let’s hope you’re right and the economy keeps it in gear.

VCRGD6XDXT3T

Tipping Points: Digital Ad Spending to Top Print in 2010. Facebook Overtakes Google.

2010-03-22T22:59:00.004-04:00

In digital economy, everything’s a commodity except ideas.

In today’s wired world, the most important economic competition is actually between you and your own imagination, wrote New York Times columnist, Thomas Friedman on Sunday. More on that in a minute.

Facebook Overtakes Google as most popular US Web site

Whether or not Facebook fits into your marketing plans, it’s important to note that the ubiquitous social network destination overtook Google as the nation’s most popular Web site according to a recent report by Hitwise. Checking Facebook accounted for more than seven percent of all Web visits, the report found. Studies show that the average American spends seven hours a month on the site and that 44 percent of all social sharing takes place on the platform. But as Online Metrics Insider pundit, Pat Lapointe recently noted, research from Keller Fay Group clearly shows that only about 10 percent of total word-of-mouth activity occurs online. Further, it establishes that in MOST categories (not all, but most), the online chatter is NOT representative of what is happening offline, at kitchen tables and office water coolers.

Digital advertising to eclipse print in 2010

While print advertising is expected to rebound slightly into positive territory, more and more signs are pointing to 2010 as the year that digital advertising officially surpasses print. Legacy media is one area that could certainly benefit from fresh ideas, or more to the point, executing on those fresh ideas. A new study from Outsell, a consulting and research group serving the information industry, recently released findings of its annual survey of over 1,000 U.S. advertisers and marketers. Altogether, U.S. advertisers and marketers plan to spend $368 billion in 2010, Outsell found -- up 1.2 percent from 2009. Within the 2010 figure, 32.5 percent ($119.6 billion) will go to digital, versus 30.3 percent ($111.5 billion) earmarked for print.

In another new study, Kantar Media found that print media in 2009 underperformed the entire industry as a whole, off 17.5% versus 12.3 percent, for the year and down 11.5% for the fourth quarter. B2B magazines particularly took it on the chin, down 26.2 percent for the year, versus a 16.6 percent for consumer magazines (which are down only three percent so far in 2010according to Media Industry Newsletter). As in previous years, print ad revenue declines will fall heaviest on newspapers -- with Outsell forecasting total ad revenues of $27 billion in 2010, down about eight percent from 2009. Outsell also sees revenue for print directories falling about eight percent to $11.6 billion. But it's not all bad news for print, as Outsell predicts a two percent increase in ad spending for magazines -- rising to $9.4 billion – reversing a several year long slump.

"The advertising recession began to ease in the final two months of 2009 and preliminary figures from the first quarter of 2010, when compared against the abyss of a year ago, indicate many sectors are experiencing growth," noted Jon Swallen, senior vice president of Research at Kantar Media in a company news release. As with other forecasters, Kantar says the best performing media category in 2009 was cable television -- losing just 1.4 percent for the entire year and up 2.7 percent in the fourth quarter. Network TV was down 7.6 percent for the year although it exceeded cable TV in the fourth quarter, up 4.1 percent.

Why ideas can’t be commoditized in the digital era

Today, just about everything is becoming a commodity, except imagination, except the ability to spark new ideas, New York Times pundit, Thomas Friedman notes: “If I get an idea, I can get a designer in Taiwan to design it. I can get a factory in China to product a prototype. I can get a factory in Viet Nam to mass manufacture it. I can use Amazon.com to handle fulfillment. I can use freelancer.com to find someone to my logo and manage my backroom. And I can do all of this at incredibly low prices.

The one thing that is not a commodity, and will never be is that spark of an idea. Thanks Thomas. That’s as true in 2010 as it was in 1910.

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Mixed Signals on Economy, Media Consumption Patterns

2010-03-02T12:02:00.004-05:00

All mixed up with somewhere to go. The question for marketers is where and when to place their bets.

Internet, Web TV gain. Plus straight talk on tablets.
For those of you fond of marking “tipping points” in the American media psyche, consider adding this one: More Americans now get their news from the Internet than they do from newspapers or radio according to a survey of 2,200 adults nationwide by the Pew Internet and American Life Project. More on this in a minute.

Mixed economic indicators

Consumer spending increased for the fourth consecutive month, the government announced yesterday, and while the 0.5 percent increase was modest at best, it set the table for cautious optimism about Friday’s monthly jobs report. In January, employment reached its highest level in five years, with the measured unemployment rate falling below 10 percent for the first time since August. While myriad factors come into play in our complex economy, economists are ultimately waiting for improvement in the job market to boost both consumer and B2B spending.

That may be a challenge. The Conference Board’s widely watched Consumer Confidence Index®, which had increased in January, declined sharply in February. The CB Index now stands at 46.0 down from 56.5 in January (the Index is pegged to a 1985 benchmark of 100). Not only is a separate CB measure – the “Present Situation” Index at its lowest level in 27 years, but the Board found that almost half (43%) of gainfully employed workers are dissatisfied with their jobs. Further, they don’t see much relief from excessive workloads, reduced perks and paychecks and the pessimism that pervades many workplaces as a trap rather than a road to opportunity. And that’s never good for spending.

Survey: More Americans get news from the Internet than newspapers or radio

Not only are more American’s tuning into the Web as their go-to source of news, but three-fourths say they hear of news via e-mail or updates on social media sites and 61 percent say they get at least some of their news online. Compare that to 54 percent who told Pew Institute researchers they listen to a radio news program and 50 percent who say they read a national or local print newspaper. The Pew survey suggests social networking sites like Facebook and Twitter have made news a more participatory experience than ever before as 37 percent of online users said they've reported news, commented on a story or shared it on sites like Facebook and Twitter, the survey said.

And with all due respect to branding experts, most Americans say they use between two and five online news sources, and 65 percent said they don't have a single favorite Web site for news. That’s pretty telling when you consider that about one-third of the study respondents were OLDER than age 50. Can any medium still compete with the immediacy of the Web? Yep. Good ol’ TV. Television news still outpaces the Internet, with 78 percent of respondents saying they watch local news and 73 percent saying they view a national network or cable news channel like CNN, Fox News or MSNBC.

However, when you compare real-time, undistracted appointment viewing to the rising share of time shifted viewing and multi-tasking viewing, the gap really narrows (see study below):

Online TV viewing climbs

According to Nielsen Company’s online panel data of U.S. visitors to online TV sites in the last 30 days, Americans are consuming more and more video on TV, Web and Mobile according to the recent Nielsen A2/M2 Three Screen Report, but the broader usage patterns suggest that online video is a replacement of DVR use, or used by those who do not have immediate access to TV. TV network content online is used to catch up with programming, and not typically as a replacement for TV viewing, as results from the email survey showed.

Top reasons for watching TV shows on the Web
(ranked by percent of respondents who agree)
• 54% forgot to watch a specific episode when it aired on TV
• 47% are catching up on the current season of programming and missed past episodes
• 33% are catching up on a past season of a program before the next season
• 32% forgot to record a specific episode with their recording device when it aired

Source: The Nielsen Company http://en-us.nielsen.com

US ad spend down nearly 10 percent in 2009

Those were the few bright spots from a Nielsen Co. report on U.S. ad spending, in which overall revenues tanked more than nine percent or $11.6 billion to $117 billion last year. Nielsen says this continues the trend of six straight quarters of declining ad revenue. Bleak to be sure, but at least Q4 2009 ad spending was down just two percent year-over-year, “and that helped soften the full-year decline,” said Terrie Brennan, senior VP for new business development at The Nielsen Company in a company news release. “In fact, most of the top advertisers showed increased spending late in the year. These are encouraging signs for an ad market that’s still trying to stop the bleeding.” Before the fourth quarter rally, many forecasters had expected 2009 to come in closer to 15 percent lower than 2008, and ’08 wasn’t exactly a banner year, either.

A few sectors did show positive year-over-year growth: Cable television grew 14.8 percent and free-standing-insert coupons climbed nearly 12 percent in 2009 versus 2008. Internet advertising remained flat (+0.1%), but Nielsen’s Internet ad expenditures are pulled from the AdRelevance database and account for CPM-based, image-based advertising only. Nielsen data overlooks some pretty big revenue pots such as paid search advertising, text only, paid fee services, performance-based campaigns, sponsorships, barters, in-stream ("pre-rolls") players, messenger applications, partnership advertising, promotions and email campaigns, or house advertising activity.

As expected, most traditional media took big hits:
• Network TV - 9.9%
• Local Newspapers -10.4%
• National Newspapers – 13.7%
• National Magazines - 19.3%
• B2B - 32.7%
• Local Sunday Supplements -44.9%

Digital Shift in Marketing Budgets

According to a recent Econsultancy survey, conducted in association with ExactTarget of more than 1,000 marketers, the shift of marketing budgets from traditional channels to digital channels will continue to rise in 2010. Nearly half (46%) of companies plan to increase their marketing budgets in 2010, says the study, and two thirds (66%) will increase their investments in digital marketing channels. Only 13 percent of companies expect to decrease their budgets overall and only one in 25 (4%) plan to decrease their digital budgets.

Additional budgeting highlights:
• 70 percent of responding companies plan to increase their budgets for off-site social media (i.e. Facebook, Twitter)
• Only 17 percent of respondents are increasing their print media budgets, compared to 41 percent who are decreasing spending.
• More than half of companies plan to increase their budgets for mobile marketing(56%), email marketing (54%), and paid search (51%)

Summary findings can be found here

What Apple and other tablet need to learn about consumers

Finally, kudos to Forbes.com Senior Editor, Lee Gomes, for a poignant piece this week about the Apple iPad’s strengths and shortcomings. If you’re in the business of making – or marketing – technology solutions to consumers and business people, I recommend you read Lee’s piece on any device you choose. Click here

Whether or not you’re an Apple devotee, Gomes points to three key criteria for evaluating any new gadget you’re contemplating: (1) How much mental and physical energy is required to lug it around? (2) What’s the turn-on time? And (3) How do you talk to it?

The devices that continue to get the most usage (and consumer eyeballs) are compact and so light you don’t know you’ve got them on your person; they’re always on and they’re easy to type on or communicate with. In iPad’s case, Gomes says’ Apple’s batting one-for-three.

END

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iPad One Week Later

2010-02-06T13:11:00.003-05:00

From tablet to tabloid, have we entered the Splinternet age? Newspaper readership down, even online, and 3 in 4 readers say they won’t pay the toll.

A week has passed since the Apple tablet hype-cycle hit full swing, we thought it would be a good time to catch our breath and take stock of what Steve Jobs’ latest product vision really is…could be….will be… and most importantly, won’t be when it’s officially available to consumers in March.

Let’s start with what the iPad won’t be. I won’t be a magic panacea to save the traditional media industry. Also, it won’t the single, indispensable, all-knowing electronic device that consumers carry around with them 24/7. And the iPad won’t be the amazing unifying technology that ties together all things Web.

“You ain’t strapping this thing to your shorts as you work out,” quipped David Pogue of the New York Times. “Will people really want to hold this device, other than on an airplane, while they watch TV and movies? However, the tablet might be the perfect breakfast table companion. You can control it with one hand and don’t have to fiddle with a keyboard.” Apple haters can also visit Gizmodo for an extensive look at “Things that Suck about the iPad”.

Is Apple’s tablet awesome? Wall Street Journal’s Walter Mossberg likened it to “holding the Internet in your hand,” and gave the tablet kudos for its affordability and generous battery life (see video for more). But, not everyone’s in love with the iPad, especially those whose business models must co-exist with it or fight against it in today’s era of co-opetition.

In a blog post late last week, Interactive Advertising Bureau (IAB) head, Randall Rothenberg, declared the new Apple tablet a threat to advertising and called it the technology industry’s latest attempt to "semi-privatize" the Web. Forrester Research analyst, Josh Bernoff, observed that all forms of media could become “gated intranets -- with significant implications for marketers, media and agencies."

Naysayers like Rothenberg have a problem with the iPad’s lack of support for Adobe Flash, a key technology for online display advertising. Many marketers and ad executives also cited the iPad's lack of Flash as a drawback. But, they welcomed the device's larger screen size which many think will kick start the long awaited explosion of mobile marketing. In case you missed it, Online Media Daily’s Mark Walsh provided a useful lens on how the iPad’s introduction will impact marketers and ad agency honchos.

While IAB’s Rothenberg argues for a "supply chain détent" in which device makers join together to adopt consistent standards that allow the advertising and marketing to flourish. Walsh opines that the problem with the Internet been too much ad inventory, not too little. Amen to that.

Blogger, David Koretz finds it hypocritical that “the proposed solution to publishers invading consumers' privacy is to have those very same publishers advertise to them about how to protect it.” Koretz thinks it’s ridiculous for publishers – who profit by selling user attention and user information -- to be tasked with protecting the privacy of those very same users.”

Forrester Research’s Bernoff, thinks new technologies like the iPad are dividing, rather than unifying the web: “each new device has its own ad networks, format, and technology. Each new social site has its login and many hide content from search engines.”

Bernoff and other observers lament that what historically made the Web (and Web marketing) magic was the fact that everything was in a compatible format. Using Any browser, any computer, any connection, you see pretty much the same thing. As Bernoff notes: “Now with iPhones, Androids, Kindles, Tablets, and TVs connecting to the Web, that's not true. Your site may not work right on these devices, especially if it includes flash or assumes mouse-based navigation. Apps that work on the iPhone don't work on the Android. Widgets for FiOS TV don't work anywhere else. Meanwhile, more and more of the interesting stuff on the Web is hidden behind a login and password. Major newspapers want to put more and more of their content behind a pay (or registered user) wall and even Facebook applications will not work anywhere else and Google can't search it.”

Blogger, Steve Woodruff, observed that the time it takes to go from “thought to output to audience engagement is so short now with new media development tools, that it makes sense to create ‘splintered’ media that will more optimally work for different audiences and platforms.”
A recent post from Dan Millbank pointed out that having one venue or medium for content never made any sense. “Think about watching TV on one channel or having to use an AT&T telephone for all communication,” wrote Millbank. “That's pretty much the way it was only 20 years ago. Options are good, freedom of choice is good. It's hard on publishers, but hey, get off your butts and publish to the channels if you want to be seen.”

Technology marketers should take seriously consumers like “Christopher” who commented on Bernoff’s “Splinternet” piece that “the threat of consumers voting with their dollar for ‘splinternet’-type devices/platforms is real. The proprietary platforms will be left behind as the collective mind and manpower of the incredibly fruitful open-source community continue to make generational leaps in tech and UI improvement. I really want a Kindle, but will probably go for the Sony Daily Edition reader because it's more open and plays well with others. I have to keep in mind that my dollars are votes for what I believe in. I hope others out there do that, too.”

A respondent named Andre fired a warning shot at advertisers and media owners in the wake of the Apple tablet’s introduction: “If content producers and advertisers think that consumers are going to download and/or install whatever is required to view their content, please think again. It will not happen. And even if it did, it will only create an unstable computing environment for users when all these apps start conflicting with one another.”

“Standards are great, but they can't make a 3-inch iPhone behave like a 12-inch computer,” quipped Bernoff. “Marketers are going to be living in many different interactive worlds. Standards will help, but when Apple, Facebook, and Google own platforms, you have to live in their environments if you like the audiences that use those platforms.”

Daily newspaper reading down to two in five adults, even online

Just as more and more daily newspapers are poised to follow Wall Street Journal, Financial Times and the New York Times into the paid content arena, a new Adweek Media/Harris Poll found that just two in five U.S. adults (43%) say they read a daily newspaper, either online or in print almost every day. Just over seven in ten Americans (72%) say they read one at least once a week while 81 percent read a daily newspaper at least once a month. One in ten adults (10%) say they never read a daily newspaper. Scary stuff. Harris survey is based on responses of 2,136 U.S. adults surveyed online between December 14 and 16, 2009 by Harris Interactive

One reason for the dying of the daily newspaper, says the report, is the aging of the daily readership. Almost two-thirds of those aged 55 and older say they still read a daily newspaper almost every day. The younger one is, however, the less often they read newspapers. But less than one quarter of those aged 18-34 say they read a newspaper almost every day while 17% in this age group say they never read a daily newspaper.

Declining readership habits on top of a prolonged advertising slump has pushed many newspapers to explore charging readers for all or some of their articles online. This model probably won’t fly as 77 percent of online adults said they would not be willing to pay anything to read a newspaper's content online. While some are willing to pay, only five percent would pay more than $10 a month.

We’re clearly in a time-shifting, 4-screen media environment (TV, Web, Mobile and Tablet) in which the reader/consumer/gamer is engaging with your offering (and brand) on their terms -- not yours. If you’re good, relevant and deliver on what you promise, then you’ll continue to make money and retain customers regardless of the delivery platform. If not, you’ll be punished at high speed and on multiple fronts.

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Get Ready for the Always Wired, Multi-Tasking, Short Attention Span Customer

2010-01-25T09:52:00.006-05:00

Whether you’re in consumer or B2B, your future buyers will be history’s least patient, hardest to reach, time-shifting customer segment.

If it seems the kids in your life are seemingly tethered throughout their waking hours to some kind of electronic or multimedia device, you’re not alone. Experts say kids and teens (ages eight to 18) spend more than seven and a half hours a day with such devices, a full 60 minutes more per day than they did five years ago, according to a new study from the Kaiser Family Foundation.

What’s more, the Kaiser survey did not count the 90 minutes kids spend texting, or the half-hour they talk on their cell phones. And because so many kids and teens are multitasking — i.e. surfing the Internet while listening to music, or texting while watching a recent episode of iCarly they’ve just downloaded with a friend — they pack on average nearly 11 hours of media content into that seven and a half hours. The report is based on a survey of more than 2,000 students in grades 3 to 12 that was conducted from October 2008 to May 2009.

Even NBC and Conan O’Brien learned the hard way that his alleged late night fan base – the 18 to 34 age group, especially the 18-25’ers – is damningly hard to reach via conventional television. A Nielsen Media Research study showed that the late night time period is one of the peak hours for DVR playback viewing, with nearly eight percent of all playback taking place between 11 pm and 2 am. And as Bnet’s Catherine Taylor pointed out, almost three fourth’s (73%) of viewers of prime time dramas now regularly skip the commercials.

On average, young people spend about two hours a day consuming media on a mobile device, the Kaiser study found. They spend almost another hour on “old” content like television or music delivered through newer pathways like the Web site Hulu or iTunes. Youths now spend more time listening to or watching media on their cell phones, or playing games, than talking on them.

The Kaiser study found young people’s media consumption grew far more in the last five years than it did from 1999 to 2004, as sophisticated mobile technology like iPods and smart phones brought media access into teenagers’ pockets and beds. Researchers also noticed that heavy media use is associated with several negatives, including behavior problems, obesity and lower grades.

If there was any silver lining to the Kaiser report, it was that the heaviest media users reported spending a similar amount of time exercising as the light media users. Many say the current youth generation is woefully out of shape and devoid of fresh air, but at least it’s an across the board problem. And we’re not necessarily training an army of future brainiacs or software geniuses.

While most of the young people in the study got good grades, 47 percent of the heaviest media users — those who consumed at least 16 hours a day — had mostly C’s or lower, compared with 23 percent of those who typically consumed media three hours a day or less. The heaviest media users were also more likely than the lightest users to report that they were bored or sad, or that they got into trouble, did not get along well with their parents and were not happy at school.

It would have been nice if the Kaiser folks could have taken the research to the next level: Determine whether heavy media use causes problems, or whether troubled youths turn to heavy media use as an escape. The study found that young people used less media in homes that had rules prohibiting television during meals or in the bedroom, or with limits on media time.

When will ad dollars follow the eyeballs online?

The average American spends 34 percent of their time online, but advertisers only allocate 12 percent of their budgets to Internet marketing, according to Forrester Research’s latest interactive forecast. It’s hard to believe a demand gap this size still exists as we enter the second decade of the new millennium, but it’s true. What’s more, only three in five surveyed marketing execs said they’ll be boosting their interactive budgets in 2010.

For example, e-mail marketing generates an ROI of $43.62 for every dollar spent, according to The Direct Marketing Association, making it the top performing direct marketing medium. In second place, search marketing, which generates $21.85 for ever y dollar invested.

U.S. Magazines Lose a Quarter of Ad Pages in 2009

On top of TV’s woes, the print folks took it on the chin again last year. New data from Publishers Information Bureau (PIB) confirms it – American magazines were about 58,340 ad pages thinner (about 25 percent) than they were in 2008 and about one third thinner than they were at the start of the decade. According to PIB data, American consumer and trade magazines ran about 170,000 pages in 2009 compared to nearly 230,000 pages in 2008 and 238,000 in 2001 – the previous worst year on record when publishers lost 17.2 percent of their ad pages in the post 9/11 slump.

Media job picture

More than one-third of U.S. employees expect a raise in the next year and 65 percent believe they'll probably get at least part of the bonus they deserve, according to the Q4 Glassdoor.com Employment Confidence Survey.

However, optimism about the job market is tempered with fear: more employees (38 percent) think it is unlikely they'd be able to find a new job in six months than those who said it was likely (33 percent). A new survey by The Conference Board found less than half (45%) of U.S. workers lucky enough to have jobs in this economy are satisfied with their jobs, down from 61 percent in 1987, the first year the survey was done.

Experts say with fewer jobs available, more people than usual are staying in jobs they dislike or find unrewarding. Marketers take note: The Conference Board expects significant turnover once the jobless rate falls and workers feel free to release themselves from their current workplace constraints. It may come as no surprise that job security is at a two-decade low. Fewer than half of U.S. workers (47.4%) say they feel secure in their jobs, the lowest level since the Conference Board survey began in 1987. Now is a good time to make sure your employees are at least content, if not happy. When the black cloud over the employment market finally lifts (typically a year after the official end of the recession), we agree with Conference Board that there will be a massive increase in career exploration if not outright turnover.

Americans think their own jobs are pretty safe, though they worry about their cubemates: 20 percent of workers are concerned they may be laid off in the next six months but 40 percent are concerned that coworkers may get pink-slipped. As the rate of job losses slows nationwide, it’s not surprising that employees exhibit more confidence in their future job security and financial outlook, but the challenge will be reconciling employees’ rising expectations of returning to their previous pay level or ability to change jobs with the realities most companies are facing to get back on solid ground, Glassdoor.com career and workplace expert, said in a statement.

Highlights of Media Bistro’s new jobs report:

• There are more companies hiring for fewer positions. In 2007, the top 10 posters on mediabistro.com's board accounted for 19 percent of all postings; in 2009, those same companies accounted for just 8 percent of listings.

• Though there were fewer jobs posted in 2009 than 2008, some categories gained market share. Those are:
o PR, with a 22% gain in market share
o Marketing, with an 18% gain
o And online/new media, with a 15% gain.
The categories that fared worst were:
o TV, with a 19% decline in market share
o Teaching, with a 13 percent drop in 2009
o And magazine publishing, advertising, and graphic design, tied for a 9 percent drop in share.

Final thoughts on Consumer Electronic ShowFrom Media Post’s Aaron Barr: And, while the technology was impressive, several attendees were unsure that consumers were ready or willing to put 3-D in their homes. Some said vision problems hamper their ability to view 3-D images, while others complained about getting headaches after watching 3-D for too long. But perhaps the most cogent argument revolved around price. Considering -- as the Consumer Electronics Association has pointed out in its sales figures -- that many consumers have already upgraded their televisions from cathode tubes to flat screens at a premium, it may simply be too soon to expect them to shell out thousands of dollars more for another television set. But perhaps the most cogent argument revolved around price. Considering -- as the Consumer Electronics Association has pointed out in its sales figures -- that many consumers have already upgraded their televisions from cathode tubes to flat screens at a premium, it may simply be too soon to expect them to shell out thousands of dollars more for another television set.

Blogger Alan D.(“Newsosaur”) Mutter had a smart take on the future of tablet PCs. Click here to read

Summary: If you need to reach the younger audience, then you better wake up to the fact that they can’t be fooled easily, they won’t put up with repetitive or non-relevant messaging, and they’ll tell you what they want – you won’t be telling them. And guess what? The older demos are following the same pattern as well. Instead of stressing so much about how you’re going to spend your budget this year, think about how you’re going to create messaging that resonates with an increasingly fickle – an unforgiving -- customer base that has more choice than ever.

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Farewell and Good Riddance to the Decade of Disruption

2010-01-06T09:47:00.007-05:00

‘A comedy of errors, except it wasn’t funny.’ Are days of free content over? Is there a reliable compass for B2B marketers?

As New York Jets coach, Rex Ryan quipped after his team’s painful blunder-filled November loss to Jacksonville: “It was a comedy of errors, but it wasn’t funny.” That summed up the year 2009 and the first decade of the new millennium for that matter. The decade started with the bursting of the .com bubble, followed by 9/11 terrorist attacks, several military quagmires in remote corners of the globe, a credit-fueled economic expansion that finally collapsed on itself and a painful unraveling of the U.S. economy whose wrath has not been seen since the Great Depression. More than one in 10 American workers are out of work (vs. four percent at the beginning of the decade), millions of homeowners face foreclosure and our homeland security still has major holes as evidenced by Christmas Day airline bombing plot in Detroit.

After record setting volatility in the U.S. financial markets, most major indices ended the decade slightly lower than they began it. The S&P 500 index for example, returned minus 0.8 percent on a 10-year annualized basis. While investors in U.S. equities didn’t really lose much on paper, they failed to keep pace with Treasury bills and the inflation rate, which is hardly worth the risk and anxiety they endured for their trouble.

Is there hope? Coach Ryan’s Jets miraculously found their bearings down the homestretch, flummoxed the odds makers and sneaked into the NFL playoffs. May the rest of us be so lucky in 2010.

“The mood is pretty optimistic in the way that you if you’re nearly killed in a car accident, you’ve got a renewed positive outlook on life,” Sunil Dhaliwal of Boston-based Battery Venture Partners told the New York Times this week.

One tough decade

“The oughts (the "uh-ohs"?) were a tough decade on a macro level, quipped blogger Seth Godin. “Front page news events will give the textbooks plenty to write about in the years to come. But on a micro level, on a personal level, this was a decade filled with opportunity. The Internet transformed our lives forever. Opportunities were created (and many were taken advantage of). And, like every decade, just about everyone missed it. Just about everyone hunkered down and did their job or did what they were told or did what they thought they were supposed to, and just about everyone got very little as a result.”
A December study by the Pew Research Center for The People & The Press, found few Americans have fond memories of the past decade. By roughly two-to-one, more say they have a generally negative rather than a generally positive impression of the past 10 years. This stands in stark contrast to the public's recollection of other decades in the past half-century. When asked to look back on the 1960s, 1970s, 1980s and 1990s, positive feelings outweigh negative in all cases.

Happy to put the 2000s behind them, most Americans are optimistic that the 2010s will be better. Nearly six in ten (59%) say they think the next decade will be better than the last for the country as a whole, though roughly a third (32%) think things will be worse. Just about every age group, except the Baby Boomers, is optimistic about the next decade.

Technology and social networking: friend or foe?

The majority of U.S. consumers see cell phones, the Internet and e-mail as changes for the better, and most also view specific changes such as handheld internet devices and online shopping as beneficial trends, according the Pew study. Most see increasing racial and ethnic diversity as a change for the better, as well as increased surveillance and security measures and the broader range of news and entertainment options.

The 2000-2009 era was clearly the decade of the Internet, or more accurately, the second-coming of the Web, after Web 1.0 was left for dead by the .com bust in the late 1990s. Media and information companies dodged a bullet in the late 1990s and smugly assumed that Web 2.0 would crash and burn the same way. Not this time cowboy. By the time conventional got its weapons locked and loaded against the new threat, the virtual gunslingers left town with bags and bags full of ad dollars.

About two-thirds of Americans (65%) say the Internet has been a change for the better, while just one in six (16%) say it has been a change for the worse; 11 percent say it hasn't made much difference while eight percent are unsure. This largely mirrors the balance of opinion at the close of the 1990s - the decade that saw the widespread adoption of the web.

The public is ambivalent when it comes to evaluating social networking sites such as Facebook. About a third (35%) call them a change for the better, 21 percent say they have been a change for the worse, while 31 percent say social networking sites have not made much of a difference and 12% are unsure. In fact, even among young people, fewer than half say social networking sites have been a change for the better. Tweet that!

Leveling the global playing field

But, for all its creative destruction, we think historians may look back at the 2000s as the “Level Playing Field Decade.” We became a truly global economy, and even as the U.S. slogged through the decade economically and militarily, China, India and Brazil enjoyed substantial increases in their respective living standards and closed the prosperity gap with the U.S. and Western Europe. Small groups of well trained insurgents can now slug it out toe-to-toe with the world’s major military powers, consumers are armed with better information and more power than ever, and anyone with an Internet connection and a compelling point of view can become a global media force. Oh, and there was that little election last year in which the world’s most powerful nation elected an ethnic minority member president by a fair-and-square vote of the populace.

Marketers: Are we in a recovery or a holding pattern?

If you’re a marketer still wrestling with your budget for next year, don’t look to the macro economy for guidance. You’ll get nothing but mixed signals. The financial markets were up over 20 percent in 2009 and that typically foreshadows an economic recovery. The number of new jobless claims is substantially lower than it was at this time a year ago and government stats say housing starts rose a surprising 8.9 percent in November after falling in October. But today, The National Association of Realtors announced that its index of pending home sales plummeted a whopping 16 percent in November. Go figure.

Despite the hints of an economic recovery, however, many Americans are still spending less. Forty two percent of Americans spent less on Holiday gifts in 2009 than they did in 2008 and only 10 percent spent more according to a December USA Today/Gallup Poll. Consumers have become accustomed to discounts. Three in five (62%) shoppers say they won’t buy an item unless it’s on sale, according to the Discover Card’s annual Holiday shopping survey.

Is the free content gravy train over?

For the better part of 10 years, consumers have been spoiled by a nearly unlimited supply of free news, pictures, consumer ratings, financial information, videos and music on the Internet. Now, there are growing signs that this free ride is drawing to a close as the ad-supported gravy train may be grinding to a halt. Newspapers, with their backs to the wall, aren’t going to be afraid to ask online readers to pay for at least some of what they offer, as a handful of papers, like The Wall Street Journal (Newscorp) and The Financial Times, already do. Experts expect many mass publications to take the “pay to read” plunge because they have few alternatives left. Just no one wants to make the first move.

NewsCorp CEO, Rupert Murdoch, has talked about forming a partnership with a single search engine, which would pay him for the rights to scour the news and entertainment programming produced by his company, rather than letting all search engines crawl his sites. Also Hulu, which is owned partly by NewsCorp, is considering charging viewers to watch some of the TV shows it now streams free.

Magazine publishers, not the most courageous bunch historically, are making noise about teaming up to create a partially gated or freemium article cooperative in which they can sell enhanced versions of what they have been giving away for years. And more and more media companies are planning to charge for apps on iPhones and other mobile devices, as well as on the Amazon Kindle and other e-readers.

Inflection point reached?

“Content providers are trying to put the toothpaste back into the tube, but only partially,” said Alan D. Mutter, a media consultant and blogger. “So we’re looking at some sort of an inflection point, at least in attitude. But I haven’t seen much realistic, hard-headed thinking about how that’s going to happen, so I don’t know how much is really going to change.”

“Quality content is not free,” Mr. Murdoch opined in The Wall Street Journal on Dec. 8, days after delivering a similar message at a Federal Trade Commission workshop. “In the future, good journalism will depend on the ability of a news organization to attract customers by providing news and information they are willing to pay for.”

Media gurus argue that charging online will work only if consumers were offered a much-improved product with the convenience of access anywhere, on any digital device, which is sort of what the magazine consortium has in mind. Jay Rosen, media blogger and journalism prof at New York University disagrees. “People who really think we have to charge or the industry is sunk would be more persuasive if they said at the same time we have to add more value than we’ve been adding,” he said.

Whether you’re a marketer or a media organization, you have more competition from corners of the economy than ever before as the Web continues to break down barriers to entry. Competitors also include your customers/subscribers and sometimes your advertisers/vendors. Size and brand alone will no longer insulate you from the competition. But agility, high value content, finely tuned audience reach and great marketing execution will not only keep you in the game, but will enable you to charge premium prices for your offerings.

Sunday night, the New York Jets convinced 80,000 customers it was worth paying top dollar to cheer them in single digit weather in a decrepit stadium when they could have watched from the warmth and safety of their own living rooms. And the Jets delivered when they had their backs to the wall. So you can you.

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Saving is cool again. Is that bad news for marketers?

2009-12-27T14:12:00.004-05:00

If you’re smart, agile, integrated and niche-focused, we like your chances. Thought leader predictions for 2010.

No doubt about it. Americans are starting to save more. In October, they saved a whopping 4.4 percent of their disposable income, according to the U.S. Commerce Department. To put that into perspective, that’s almost double the average annual savings rate of 2.7 percent for the past 10 years. The rate dipped to near zero at several points in recent years, according to a story last week in the Wall Street Journal and many economists expect the savings rate to increase further from here.
Whether you call it pragmatism, fear, or the reverse consumer confidence index, U.S. consumers and businesses are hording more of their cash than they have in a long time and that has profound implications for marketers.

Experts say the economy is on the mend from the worst recession in half a century. But many say businesses of all kinds are skeptical that American consumers will return to their spendthrift ways anytime soon. They see consumers emerging from the brutal economic climate with a new mind-set: careful, practical, more socially conscious and less prone to ostentatiousness.

“Much as the 1930s shaped the spending habits of an entire generation, many companies now anticipate a shift in consumer behavior that persists even after jobs and growth get back closer to normal,” the Journal said. John Quelch, a Harvard marketing professor, thinks Americans will discover more cost-effective ways to live, and those coping mechanisms become engrained.

We don’t agree.

While consumers and business purchasing managers are scrutinizing every expense they possibly can, we think the “new normal” will return to the “historical normal.” That means American consumers – the world’s savviest shoppers and best-trained bargain hunters – will unleash a torrent of pent up demand as they start to see fewer foreclosure signs in their neighborhoods, more folks back to work and their 401k’s start to show signs of sanity. And that will trickle down to business in every sector.

Why smart marketers will win

This is where smart marketing comes in, especially if you have a medium to long-range sales cycle. You can forget about sitting back and taking orders when the “all clear” signal emerges from the U.S. economy. By then it will be too late. Competitors who get the business are the ones who have been steadfastly marketing and adapting throughout the downturn, keeping both the brand awareness and demand generation spigots reasonably on stay top of mind with their customers and prospects.

Marketing predictions for 2010

We’ll share ours with you next week. In the mean time, George Simpson of Online Media Daily had these pearls from his panel of experts. Click for full article

• “2010 will be the year of data-driven TV -- which will come of age in 2010 -- will only extend that dominance."
• “Brand dollars will accelerate their shift to online, driven by the scale of professional online video content and the rise of technologies that enable real-time demographic targeting."
• “Agencies will become more active and skilled in acquiring audiences through data partners -- separate from their purchase of media."
• "In 2010, advertisers will figure out that they can significantly boost campaigns by augmenting with innovative mobile phone and social networking solutions that more fully engage consumers."
• "The shift of ad dollars from standard display ads to social marketing programs that deliver engagement will be most notable as marketers shift focus from clicks to engagement and from CPM and CPC to cost per engagement metrics."
• "The marketplace will realize that the market for conversions relies on retargeting, which everyone does, leaving lots of people scratching their heads with 'OK, now what do we do to move real dollars online from brand marketers?'"
• "The subscription model for content will re-emerge as a viable business, because content publishers are having trouble standing on paid ads alone."
• "It will be the year of the niche. Mass is dead. A focus on being nimble and resourceful are the keys to winning in 2010."

Stay true to your brand and stay smart, focused, agile, integrated and niche-focused. More easily said than done in 2010. But if your continued to market throught the downturn and who got your new media experimentation out of the way when your rivals went into budgetary hibernation mode are going to win. And your're going to win big.

Study: Ad Spending Plans Returning to Pre-Recession Levels

2009-12-04T13:49:00.004-05:00

But, consumers tightfisted as Cyber Monday fails to rescue a bleak Black Friday. Is a prolonged ‘saving spree’ on the horizon? Google CEO defends practices vs. newspaper industry and online video surges.

Ad executives are more optimistic about their budgets than at any time in the past two years according to new research from Advertiser Perceptions Inc., a media industry research firm that tracks the long-term confidence of advertisers and agency media-buying executives. The Ad Perceptions index currently stands at a positive four percentage points, its highest level since the autumn of 2007, when the index stood at positive eight percentage points.

The most recent survey, fielded in November, shows that ad spending sentiment is now improving for every medium tracked, even for some traditional media such as newspapers, magazines and broadcast, which continue to have an overall negative index. The outlook for most electronic media, especially online and mobile media, is well in the positive range and also continues to improve.

The positive index for all digital media - both online and mobile - went from 40 percentage points in the spring 2009 survey to 55 percentage points in the just-completed fall survey. The positive index for cable TV jumped to 11 percentage points from one percentage point last spring. Traditional media are still in negative territory, but improving, researchers said. For example, broadcast television stood at minus eight percent; magazines at minus 19 percent and local newspapers at minus 35 percent. Bleak readings, bit significantly on the mend from the last time they had their temperatures checked.

In a Wall Street Journal op-ed piece earlier this week, Google CEO said the Internet wasn’t destroying the news industry as much as forcing adoption of a more efficient business model. Borrowing from Rupert Murdoch, Schmidt wrote: “It's understandable to look to find someone else to blame. But it is complacency caused by past monopolies, not technology, that has been the real threat to the news industry.“

From Black Friday to Cyber Monday consumers cautious this Holiday season

Online shopping sites reported a surge in sales and traffic on CyberMonday (the first Monday after Thanksgiving), surpassing the tepid results achieved by bricks-and-mortar retailers so far this Holiday season. Online shoppers spent 11 percent more than they did a year ago, according to CoreMetrics a Web analytics company that tracks online shopping behavior in the U.S. But the average size of each purchase was down 14 percent from last year. Researchers say this indicates that Web merchants are facing the same bargain-hunting/comparison shopping consumer mindset that traditional retailers have faced so far.

Despite today’s drop in the official national unemployment rate, which was the first improvement in the jobless rate in 24 months, “the U.S. consumer is still too depressed to buy us a quick end to the recession,” laments Forbes columnist A. Gary Shilling in this week’s issue. “Consumers have no choice but to begin a decade-long saving spree as depressed home prices and high unemployment rates are temporing their willingness to take on debt of any kind – if they can even get it -- from personal credit cards to home equity lines.

Is the job market really coming back? Click here for a fairly well balanced range of opinions from Wall Street Journal online discussion

Online shopping may account for 10 percent of Holiday shopping this year, up from five percent to seven percent in previous years according to Forrester Research, which indicated the shift to online shopping, fueled by deal seekers in a recession, may come at the expense of traditional stores later in the Holiday season. It’s also important to note that a heavy shopper turnout at this time of year does not necessarily translate into heavy sales. Last year, Black Friday and Cyber Monday traffic hit record levels but the 2008 Holiday retail season was one of the worst in decades according to a New York Times report earlier this week.

If you sensed it was even more crowded than normal at your local mall over Thanksgiving weekend, you’re not alone. According to the National Retail Foundation (NRF), some 195 million consumers visited U.S. stores and Web sites last weekend, up from 172 million the previous year, but the average spend dropped to $347 from $372 the NRF said as “shoppers can continue to expect retailers to focus on low prices and bargains throughout December.

Media royalty was fed by advertising until Google blew that game apart

In case you missed it, David Carr’s thought-provoking piece “The Fall and Rise of Media” in MOnday's New York Times is worth a quick read. Instead of just another piece bashing traditional media, Carr neatly dissects traditional media’s appeal for ambitious young people, its surprising ability to extend its lifecycle beyond its logical expiration date, and how it is currently dealing with its long overdue day of reckoning. Rather than blaming Google, Facebook and Craig’s list for finally fixing an unaccountable advertising economy that “was built on inefficiency and excess, Carr points to a new future “which is not a bad deal if your ignore all the collateral gore.” Ambitious young people will still flock to Manhattan to remake world, Carr quips -- “they just won’t be stopping by the human resource department of Conde Nast to begin their ascent.” For every kid he sees wandering the entrance of the media world looking for an entrance that has long since closed, he sees another kid “who is a bundle of ideas, energy and technological mastery, who is not just knocking on doors but seeking to knock them down.”

Viewing of Online Video Streams Up 26 percent in October

The Nielsen Company today reported overall online video usage and top online brands ranked by video streams for October 2009. Year-over-year, unique viewers, total streams, streams per viewer and time per viewer were up, led by a 26 percent growth in total streams.

October 2009 vs October 2008

Unique Viewers**********138.6M (+14.8%)
Total Streams**************11.2B (+26.2%)
Streams per Viewer********81.0 (+ 9.9%)
Time per Viewer (min) 212.5 (+ 23.8%)
Source: The Nielsen Company

In a related note, Nielsen announced Tuesday that it would start counting online television viewership in its overall rating measurement for which an estimated $70 billion in ad spending is predicated. More next week.

From where we sit, it looks like the 2010 media buying climate will be in lockstop with the 2009 Holiday shopping season – a great deal of bargain hunting and comparison shopping with few long-term commitments and a lot of second-guessing. Measurable value will trump fancy packaging and there will be buyers’ remorse aplenty.

Key to the Future? Managing the Unknowable

2009-11-25T19:06:00.003-05:00

Turkey day food for thought. Microsoft search deal with Newscorp could backfire. TV still relevant. 2010 marketing budgets show signs of life.

It’s no secret the Web’s explosive growth has been driven by the principle of the open playing field. Using collaboration and open source tools, the small guys can take on the behomoths by using their smarts, speed and savvy. But Microsoft, arguable lacking several of the aforementioned S’s, wants to use its muscle to tilt the playing field in its favor if a proposed deal with News Corporation comes to pass.

In case you missed it, Microsoft is in discussions with News Corp to remove links to its news content from Google’s search engine and display links exclusively on Microsoft’s ambitious new Bing search engine. Web pundits think this kind of a deal could induce major media and tech companies to start choosing one over the other which is about as good for consumers as the cable tv model is. Even worse, this scenario creates a whole new set of hoops for Web users to navigate.

According to Comscore, Bing has gained about 10 percent of the search market in its first year – an impressive showing, but still miles behind Google which handles about two thirds (65%) of the total U.S. search queries performed. Yahoo, ranked second (`19%), has lost about 10 percent of its market share since Bing entered the scene.

While we salute Microsoft’s aggressiveness and its aspirations to break up the Google-opoly on the Web, we side with the experts who say the Internet historically favors players who share tools and information, rather than building barriers to it. If there’s any positive outcome to the latest Miscrosoft initiative it will be that all the major search players will have to continue to improve their offerings in order to hold on to their market share.

Marketing budgets claw back to life

Despite the budgetary carnage inflicted upon marketers in 2009, nearly 40 percent of the 376 marketers surveyed by BtoB magazine plan to increase spending next year. Almost half plan to keep budgets steady and only one in eight (13%) plan to cut them next year. Of course, what marketers report in surveys differs greatly from how they actually open their wallets it’s an optimistic sign nonetheless. It’s no surprise that online marketing will continue to siphon off dollars from traditional media with e-mail marketing, search, social media, video and Webcasts garnering the largest increases. Researchers say customer acquisition (and marketing on the cheap) will continue to be dominant drivers of the B2B marketing landscape as measuring ROI will get a lot more attention than branding for at least another year. We’re betting that when the economy finally rebounds in late 2010 or early 2011, marketers will continue to give online the seat it deserves at the table – because they see its wholistic merits, not because it’s cheap.
Click here for more stats and analysis from BtoB.

Thriving in era of uncertainty

If you get a chance over this long Holiday weekend, check out Howard Sherman’s piece in BtoB: “When Uncertainty Is Normal”. Howard’s take is that business has never been more complicated, demanding or high stakes. To succeed in marketing and in business operations, companies will need skills their top dogs aren’t always comfortable with: “collaborative thinking by smart people.”

You need to help clients/customers accept ambiguity. You need to adhere to a nimble framework. You need to restore internal relationships, especially if your organization has dramatically downsized or restructured and rebuild trust with all of your stakeholders including customers, investors and prospects. Right on, Howard.

Research confirms: TV still draws audience

A new survey by Nielsen Company says that despite the Internet, iPhones, twitter and facebook, we’re actually watching more television not less – an average of 4 hrs and 49 minute/day for average American, up 20% from a decade ago (4:06). Nielsen says U.S. TV viewers broke another record -- increasing their consumption last year. The media research company said U.S. viewers watched 4 hours and 49 minutes of TV per day for the 2008-2009 season -- when looking at live viewing plus seven days of DVR playback.

That's up four minutes -- or 1.4 percent -- from the previous season. Why the rise? Nielsen says the gain came from more television sets in homes and more channels available for U.S. viewers. In addition, DVRs have increased the overall TV usage total: live and playback. It also appears that viewership improvements came in non-prime-time dayparts.

So if you're still agonizing about how to budget for 2010, just expect the unexpected and Strategically Stumble(tm) through it faster than your rivals.

Ad Accountability for Print Media?

2009-11-13T17:55:00.003-05:00

Magazines borrow page from online media as page shakeout continues. Facebook as crime solving tool. Google acquisition should jumpstart mobile advertising category.

We’re not sure whether to put this under the “innovation” or “desperation” column, but Monday, The Week magazine announced is was guaranteeing advertisers that their ads will generate higher “recall” scores in The Week than they will in most other magazines in which they run. How? The Week has enlisted the help of Vista from Affinity, who will measure ad recall based on how consumers in its focus groups remember seeing a certain ad in the magazines where it runs. The Week guarantees an ad will score in the top one-third of all magazines where it runs or The Week will run free ad pages for the advertiser until it gets to the benchmark. The program is only reserved for regular 12x advertisers, but Steven Kotok, president of The Week, expected 80 percent of its clients to qualify. We salute The Week’s efforts to bring more accountability to the beleaguered print category and expect many more publishers to follow suit in 2010.

Ad pages drop sharply at Conde Nast

You don’t need the geniuses from McKinsey & Company to tell you it’s a lousy year for print media. Make that a lousy decade. Just days after Hachette Filipacchi Media U.S. announced that Metropolitan Home will be shuttered with its December issue (see below), Conde Nast announced this week that its 2009 pages are in, and it won’t be the merriest of office Christmas Parties high above Times Square for those who remain employed there. Ad pages are down by one-third for the year as more than 8,400 pages evaporated from it normally luxurious ledger. The company closed popular titles Portfolio, Gourmet and Modern Bride as well as Cookie and Elegant Bride and survivors who depend on purveyors of luxury goods took significant hits: Architectural Digest lost half (49.9%) of its ad pages; W lost 46 percent and Conde Nast Traveler lost 41 percent according to company data released to the media. On average, ad pages fell 27.6 percent industry wide for the first nine months of 2009 according to the Publishers Information Bureau. Branding will take you only so far in tough time and once again, print advertising becomes a luxury, not a core necessity, when times are tough and you can’t measure its direct effectiveness to pull customers into your stores.

Obituary announced for MetHome

Another acclaimed aspirational consumer magazine will cease publication in December. Hachette Filipacchi Media U.S. announced that Metropolitan Home will be shuttered with its December issue, citing a lousy housing market and cuts in discretionary income for home renovations. Ad pages were down nearly 36 percent year-over-year, about the same as Gourmet’s, another popular magazine shuttered last month by Conde Nast. No plans announced about Met Home’s Web site. This recession has been particular unkind to the shelter magazine category and has forced the closing of House & Garden, Domino, Southern Accents, Cottage Living, In Style, O at Home and Country Home.

Facebook saves accused from perp walk

With more and more people revealing details of their private lives online – from the banal to the shocking – a potentially useful but unintended application of popular social network sites like Facebook, MySpaceand Twitter may be emerging. Crime-solving. A NYC teen, Rodney Bradford posted a seemingly meaningless post on Oct. 17 at 11:49 a.m. asking where his pancakes were. One of millions of banal, time-wasting posts that day until Bradford, 19, was arrested the next day as a suspect in an armed robbery at the housing project where he lives. Those words became his alibi. The entry, made at approximately the same time as the robbery. The New York District Attorney subpoenaed Facebook to verify that Bradford’s words had been typed from a computer at the apartment where he lives with his father. When that was confirmed, the charges were dropped. While social networking sites has been used as prosecutorial evidence in cases ranging from cyber-bullying to armed robbery and murder, legal experts believe it’s the first time such sites have been used as alibi evidence. Because of how ubiquitous social networking sites have become, we expect them to have a role in increasingly more cases as their user demographics tend to mirror the prime ages of those committing violent crimes, teens and young adults.
Social Media Update

Tweeting your company to the top of the search results

According to Internet Marketing Report (IMR), doing more with Twitter could help your company reach prospects who don’t actively “tweet” or even know what that means. IMR says all the search engines plan to include Twitter updates in their search results. Google plans to add tweets in its search result that may gain from real-time observations. The Bing search engine is planning to add posts from Twitter and Facebook.

Measuring success of marketing campaigns:
• 77% of marketers say new customers acquired
• 73% say the number of new leads
• 67% say net increase in sales
• 29% say increase in purchase intent
• 22% say increase in purchase intent
• 21% say changes in “perceptual attributes”
Source: eMarketer.com, October 2009 study

Blogs, e-mail and Web site optimization most economical sources of leads. But watch PPC.
New research from Hubspot.com finds online channels deliver qualified sales leads for significantly less money than telemarketing, trade shows and direct mail. While Blogs, e-mail and Web site optimization (SEO) scored high on “relative cost per lead”, what caught our attention was that one third (32%) of marketers surveyed by Hubspot said pay-per-click (PPC) was also a relatively expensive way to acquire leads. More on that in future issues.

Relative cost per lead by channel
% of marketers who said “below average cost”

Blogs/social media *****************55%
E-mail marketing**************49%
SEO*********************48%
Direct Mail *********34%
PPC*************32%
Telemarketing **29%
Trade Shows**18
Source: Hubspot.com

Economy

So what’s up with the stock market? The economy can’t get out of first gear. Unemployment’s at the highest level in 27 years. The dollar’s sinking like a stone and the stock market keeps going up. At last glance, The Dow closed the week at nearly 10,200, up more than 16 percent for the year and the S&P closed over 1,100, up more than 20 percent for the year.

Oddly, the same problem that worries many investors over the longer term is what encourages some for the short term: a soft economy. The reason is that an ailing economy requires the Federal Reserve to keep its short-term interest-rate targets near zero and continue pumping billions of dollars into the financial system. That is great for stocks because much of that money eventually finds its way into financial markets, and because cheap money keeps financing costs low and pushes corporate profits higher. Worries about whether government intervention would be enough to keep the economy growing have been one of the reasons behind the series of volatile up and down swings in late October and early November.
*** For a great take on the “Jobless Recovery” check out University of Chicago professor, Casey Mulligan’s blog on Economix.

Google acquisition of startup could jumpstart mobile ad category

Monday Google announced it has agreed to acquire mobile advertising startup AdMob for $750 million in stock. AdMob, whose clients include P&G, Adidas and Land Rover, is a leading seller of banner ads on iPhone apps and Web pages that can be retrieved from mobile phones. This deal will probably cement the viability of the much hyped mobile advertising business….still in its nascent stages at $160 million (source: Kelsey Group), less than one percent of the $23 billion in online ads in 2008 according to Internet Advertising Bureau.

While most of the mobile ads so far have been delivered by text message. Experts point to the growing popularity of the iPhone and other popular mobile devices, the ads will become more engaging and widespread. Analysts say Google already has an edge on its rivals Microsoft and Yahoo when it comes to ads linked to search queries via mobile. Expect Microsoft and Yahoo to look for deals with other mobile ad providers like JumpTap, Millenial Media and Quattro Wireless.

For advertising to work as we head into the second decade of the new millennium, it’s got to be measurable and prove it works. That said, the burden for accountability is a two way street. Publishers and Web site operators have to work more closely with their media partners to understand their marketing objectives, not meet monthly page or banner inventory quotas. On the flip side, marketers and their agencies need to do a better job of understanding their media partners’ audience, editorial tone and pulse. E-mailing generic spreadsheets or RFPs to media partners with 24 hours’ notice to get them done is not how great advertising or marketing gets done. And when it comes time to reconcile the success or failure of a campaign, both sides need real metrics, not self-serving “ad recall” surveys or click-based McMetrics to show ROI.

Let’s be a lot smarter, less greedy and more patient next decade.

First Generation in History in Which Kids Are Smarter Than Parents

2009-11-06T14:38:00.004-05:00

Gaming now part of the information paradigm shift at work, home and school. Spike in agency reviews point to ad spending turnaround and need for fresh thinking.

“This is the first generation in recorded history in which the kids are smarter than their parents,” said Tom Hood, CPA, a popular blogger and new media professor who led a poignant social networking panel discussion I attended last week. “They’re way ahead of us in terms of digital technology, interactive media and collaboration.”

While the younger generation doesn’t have the personal spending power or corporate budget influence of its elders, the wired generation is influencing spending decisions (and driving rapid adoption) of anything related to technology, media consumption and social networking. If you market anything that touches a U.S. household or workplace with people under age 30 on the premises, then you better think about ways to market to AND THROUGH the younger generation.

My fifth grader does his school reports in PowerPoint, saves them to a pen drive, turns the device in to his teacher who inserts it into her classroom PC and displays the assignment on a chalk-free SmartBoard for all his classmates to critique. My first grader is an active “MMOGer” (massively multiplayer online gamer) interacting after school each day with virtual peers on Club Penguin, a 12-million member online community containing a range of Web based games and activities in which players user cartoon penguins as avatars, waddle around, chat, play mini-games and participate in other activities with one another in a snow-covered virtual world. Both kids and their pals have taught themselves to use Mom’s digital SLR camera to shoot YouTube videos of their sports and car racing exploits, complete with music, slow motion and title credits. I’m staying out of it, mildly amused. But when the ads start rolling in, I’m insisting on taking a cut to pay for “studio rental” time.

My kids also got their hands on my clunky standard-issue cell phone during a long car trip. Turns out it has a camera, video recorder and app for downloading games and music. Who knew? Like me, they wouldn’t be caught dead reading the manual. Unlike me, they have the patience and intuition to experiment with mysterious looking buttons on the side of the phone and don’t get frustrated when it fails to do what one expects it to do. They still can’t do anything about the spotty voice service, but to this generation, a cell phone is a multi-media toy that happens to have voice capabilities. It’s not a semi-reliable mobile communication tool that we view it as. They also don’t have to deal with the new charges showing up in my monthly bill – yet.

Unlike the games their older siblings grew up with, today’s educational games tend to be online and social, allowing kids to interact and collaborate to achieve common goals. As the New York Times reported last week, the newest educational games, unlike the stand-alone boxed games of the 1990s, are set up like services in which children can enter a virtual world, try on a character and solve problems that may relate to the real world. Newer games work concepts of math, science and language into the actual game mechanics, instead of stopping for something that feels like schoolwork.

For another take on responsible online destinations for kids, check out Fifty P where kids can get real-life lessons on financial literacy and savings plans without stern lectures about the value of money from their elders.

Marketing to the short attention, time-shifting consumer

The debate rages on about whether or not humans can truly perform simultaneous mental processes, but we’re multi-tasking more than any previous generation and there’s no sign of turning back. A recent University of Melbourne study found that people who use the Web at work for personal use are actually nine percent MORE productive, not less, than those who don’t.

If you’re in marketing, you better get used to increasingly shorter attention spans and you’ll have to work harder than ever to reach those targets in a three-screen time shifting world.

Economy

The recession is technically over, stock markets are up double-digits for the year and the Fed yesterday promised not to raise its rock bottom interest rates for an “extended period.” What’s more, the government last week said the economy grew 3.5percent in the third quarter, its first quarterly expansion in a year. Unfortunately, experts says economic growth will remain “weak for a time” as the jobless rate surpasses the 10 percent barrier for the first time in 27 years and retailers brace for a Grinch-like Holiday shopping season. With both consumers and corporations in extended “wait and see” mode, media partners should expect short term, opportunistic ad spending flurries, but no sustained uptrend that you can take to the bank.

Media

U.S. ad spending fell 15.4 percent in the first half of 2009, according to Nielsen Company data with online advertising the only sector expected to record positive growth for the year -- a projected 9.2. percent to $54.1 billion, according to Zenith Optimedia research. All other media are shrinking, notes Zenith in a recent report (PDF) “Most are shrinking at around the market average rate, but newspapers and magazines are in steep decline: we forecast newspaper ad expenditure to fall 17 percent this year, and magazine ad expenditure to shrink 20 percent. In both cases this is a particularly severe example of a longer-term trend; these media have been in decline since 2007, and we expect them to remain in decline for the rest of our forecast period.”

Despite print media’s long-term struggles, signs are emerging that the painful advertising slump of the past two years may finally be easing. The Wall Street Journal reported last week that a long list of major marketers, including UPS, Unilever, US Army, General Motors, Yum Brands and Emirates Airlines, are seeking overtures from new advertising firms. According to the Journal, when the online shoe retailer Zappos.com invited pitches for its small account earlier this year, more than 100 ad agencies submitted credentials.

"Clearly we are seeing the beginnings of an ad recovery. The volume of ad reviews is way up," Russell Wohlwerth, principal of Ark Advisors, a consulting firm that matches ad firms with marketers, told the Journal. But over the past few years, the process of searching for a new advertising or media-buying firm has dramatically changed. About 80 percent of reviews now include procurement departments, up from 30 percent to 40 percent about five years ago, consultants say. And decisions are being made in the conference room not the golf course.

For nation’s newspapers print circulation plummets, but Web visits up

New figures released last week by the Audit Bureau of Circulation showed double-digit circulation drops for 22 of the nation’s top 25 papers amid an industry-wide decline of 10.6 percent for the six months ended September 30. At just 44 million copies, U.S. daily papers sold fewer editions than at any time since the 1940s. Industry execs say part of the readership loss is self-imposed. By that they mean rising manufacturing costs and dropping ad revenue has forced them to cut “unprofitable circulation” which in industry parlance refers to those with bad credit, low incomes, intermittent subscriptions and readers who live in outlying areas. But, few will argue that the Web has siphoned off millions of print readers and advertising dollars. Newspaper Web sites are updated more frequently than their ink-stained brethren. Web papers don’t arrive wet, late or tattered and by and large they’re free. This year, newspaper Web sites have had more than 72 million unique visitors, up 20 percent from 60 million in 2007 according to Nielsen Online reports for the Newspaper Association. We see this trend continuing on an exponential

The younger generation thrives on collaboration, speed and entertainment, said blogger Tom Hood.

If you’re in marketing, particularly B2B, then keep in mind the fact that “Young people may be new to the world of work, but their bosses are immigrants to the world of the Web.”

Look to gaming if you want to win the game.

Recession Over, Or Are We Just Sick of Hearing About It?

2009-10-19T09:38:00.004-04:00

Unemployment flirting with 10 percent, but Dow eclipses 10K, Google ads and Goldman bonuses flying high and ABC show about horny ‘cougars’ rejects big ad buy about same topic.

As we alluded to in our last rant here, most people’s outlook on the state of the U.S. economy depends on whether or not you’re working. With interest rates historically low, deals galore on the retail and housing fronts and the financial markets up over 20 percent this year, you’ve got pretty good buying power if you’re lucky enough to have a job. If you’re out of work -- like more able-bodied Americans are than at any time in a quarter century, then things aren’t looking too rosy.

Employers are mired in a long-term hiring and capital investment freeze. More homeowners than ever are underwater on the mortgages and/or not keeping current with their payments. New companies, or new divisions of existing aren’t being formed to create new jobs. Older workers are afraid to leave the workforce due to insecurity over their retirement accounts and that’s clogging up the normal payroll succession plan as millions of energetic new college graduates can’t get a foot in the door.

The challenge for today’s marketers is to resonate with all sectors of your customer base, regardless of what life circumstances they’re encountering, and that means a one-size fits all global branding campaign may not do the trick.
So, how are global marketers responding? They’re tapping into that “less worse than last year” psychology and slowly reinvesting in their brands.
Stephanie Clifford of the NY Times had a nice take on this phenomenon the other day,

“It may be a sign that the recession is ending, or it may be a sign that consumers are sick of hearing about it,” quipped NY Times columnist, Stephanie Clifford last week. “While economists and investors study housing starts and gross domestic product predictions to measure economic vibrancy, General Electric (“The American renewal is happening right now”), Bank of America (“America. Growing stronger every day”), Levi’s (“Pioneers! O Pioneers!”) and other companies are using commercials to proclaim that America’s future is bright. And that may be something of a self-fulfilling prophecy.” Let’s hope she’s right. As Brand Union/WPP’s Robert Scalea told Clifford: “Marketing is always a reflection of societal values, and many times, for smarter marketers, it’s a driver of them.”

Google vs. Dow as bellwether of the ad economy

On Thursday, Google reported better than expected Q3 financial results – 27 percent increase in net income -- on the strength of its ad sales program. CEO, Eric Schmidt declared the worst of the recession over and that Google was embarking on a new phase of investment, hiring and acquisitions. Many analysts contend that Google’s results are closely correlated with online spending – one of the few bright spots in the advertising sector --- and are likely to be trumpeted across many sectors of the industry.

“We’re seeing double-digit increases in budgets for 2010 from our clients,” Bryan Wiener, head of digital agency 360i {www.360i.com} told The New York Times last week.

How will you read magazines in 10 years?

From Conde Nast to McGraw Hill to the Economist Group, it’s clear that the cash cow of print-based, high-ticket, hard-to-measure, brand advertising has been slaughtered. Conde shuttered four titles, including the much-admired Gourmet. Bloomberg LLP snagged Business Week for next to nothing and Economist Group’s editorially poignant, but ad-challenged CFO still can’t get a date to the buyout prom.

Is that finally it for the magazine medium? We think not. Magazines will continue to be relevant, but how we engage in them may be changed forever. Over the next decade, three in five “readers” of magazines won’t be interacting with their favorite titles in dead-tree form, according to a recent survey of nearly 400 Wall Street Journal readers. Nearly 30 percent said they’d be reading online; another 20 percent said they’d be reading via E-reader or mobile device and nearly one in 10 said they wouldn’t be reading at all.
If print media is a key component of your marketing mix, then you better take notice.
How will you read magazines in 10 years?

PRINT*********42%
ONLINE********29%
E-READER******17%
PHONE**********3%
I WON’T********9%
Source: Wall Street Journal

Said one respondent to the WSJ survey: “Unfortunately the selection for how we will read magazines in the future is too simplistic. If wise, publishers will realize that that are creating content and can deliver it in different forms, print, online, phone e-reader and not as magazines but as articles, so that if I am interested in food, I can read a gourmet article from ‘gourmet magazine’ which as a magazine of today's format need not exist.” Brother, you got that right.

Are these TV people for real?

David Letterman, the curmudgeonly late night talk show host for CBS and product Worldwide (Can’t Keep it in My) Pants, gets exposed for running a broadcast equivalent of the Wall Street Boom-Boom run in his offices and gets an instant ratings boost. Jay Leno, who was supposed to be dead in the water in prime time is far exceeding rating expectations. For a fraction of what it costs to put on a prime time drama, Leno is helping NBC rake in the profits by re-reading local newspaper headlines, quizzing airhead LA pedestrians about current events and challenging B-list celebs to simulate slow-speed car chases on a Burbank studio parking lost. And it works. So to all the cable shows about house-flipping, home makeovers and savvy real-estate investing at a time when record numbers of Americans are in foreclosure or underwater on their mortgages. Then there’s Cougar Town, ABC’s popular new Courtney Cox sitcom about spurned 40-something women prowling for 20-something studly men. More than seven million viewers are tuning in each week and apparently the has enough ad dough in the pipeline to turn down a huge proposed media buy from a Web site for real-life cougars on the grounds of decency concerns.

We’re not passing ethical judgment here. We’re just pointing out that the mood has lightened up enough in this country so that support for these shows, and the vicarious thrills they provide, may point to hopes of better times ahead.

Conclusion

As a Miami University professor noted in the aforementioned Stephanie Clifford piece: “The truth is, we want to believe they’re right. Deep down inside, even skeptics want to be hopeful” in these times.

Bad News, Recession Over. Risk Taking, Personal Savings Up

2009-09-30T10:31:00.003-04:00

Are companies ready for pent up spike in demand? M&A, IPOs, SPACs return. Fasten seatbelts as ides of October approach on anniversary of financial crisis. Have we learned anything?

With the Dow Jones Industrial Average knocking on the door of 10,000 – a benchmark seemingly out of reach six months ago – and nationwide home prices up for the second straight month, both leading and trailing indicators of the economic rebound we first called in this blog in April are all around us. From a technical perspective, the "recession is very likely over at this point," U.S. Federal Reserve Chairman, Ben Bernanke said in a mid-month Q&A session at the Brookings Institution. So why aren’t homeowners and job seekers rejoicing, let alone the marketers who target them?

The Dow 10,000 barrier is mostly psychological, but as Stuart Freeman, senior equity analyst at Wells Fargo Advisors told the New York Times this week: “It’s psychological, but if enough people act on it it’s meaningful. The higher the market goes, the more those on the sidelines sit there and are concerned they’re missing something.”

Why we’re still worried

Home prices nationwide are still 13.3 percent lower than a year earlier, according to the widely followed S&P/Case Schiller Index, but recent monthly gains show that the pace of decline has slowed. Housing aside, several trends concern us at this juncture. First, the Government, including the Fed, is not in the forecasting business. It’s in the restating-the-obvious-but-making-it-official business. Second, we’re not convinced the fundamentals are there to support a sustained rally in the economy. More on that in a minute. Third, and perhaps most frightening, is this economic turnaround might be for real.

What’s wrong with that you say? Plenty. For starters, most companies are not be prepared to handle the surge in pent up demand, as they trimmed their workforces, production capabilities, customer service departments and marketing budgets so severely during the downturn. Cost-cutting occurs faster and deeper, than re-hiring and re-investing. The only thing worse than having customers bail on you when times are lousy is having them bail on you because you can’t handle their orders when times are better.

And here’s where it gets tricky. Even if the Fed and the financial markets are correctly signaling the end of the Great Recession of 2008-09, 15 million able-bodied workers – about 10 percent of the full-time work force -- are out of work. Combine that with stagnant incomes for all workers and higher rates of personal saving (due to fear, not financial discipline) and this could reduce corporate revenue for years to come. We’re also dealing with massive consumer defaults on credit cards, record numbers of mortgage defaults, delinquent student loans and stagnant incomes for those lucky enough to be working. Oh, and housing unit sales (not prices) went down another 2.7 percent in August, we learned last week.

Where is the money going to come from, to purchase those goods and services we need to keep the economy humming? More than 70 percent of Americans still rate the job market “bad” according to a recent Harris Poll. Paychecks have been stagnant for about a decade and using one’s home equity as an ATM machine – essentially what kept the Great Recession at bay for about three years – isn’t a viable fallback this time around.

Cautious Optimism for The Economy Ahead

Results of the latest Harris Poll of 2,498 U.S. adults surveyed online show that there is a slight sense of optimism regarding the economy. Nearly half (46%) of Americans believe the economy will improve in the coming year, while a third (32%) say it will stay the same and 22 percent believe it will get worse. In May, just under two in five believed the economy would improve in the coming year while over one-quarter said they thought it would get worse. But overall, they’re not so confident about their own situation, which is a great departure from most economic climates in which survey respondents tend to say they’re better off – not worse off -- than their neighbors.

One-quarter of Americans believe that their household financial condition will be better in six months while half say it will remain the same and 28 percent believe it will get worse. If there’s a silver lining to this cloud, consider that the 28 percent who say their household's financial condition will get worse in the next six months is the lowest reading for this question since Harris pollsters first asked in February of 2008.
Greed and irrational exuberance

Twitter –- a 60-person online social networking company with a catchy name and no revenue to speak of, was recently valued at $1 billion as it announced plans to raise $100 million to salivating venture capitalists. The markets also bounded higher on signs that companies once again had enough cash, credit and confidence to enter into big M&A deals. Xerox, Abbot Labs, Dell, Disney and Kraft Foods have announced takeover plans. Could credit really be flowing again between banks and corporate giants? At least the lawyers are happy.
What’s more, last week was the busiest for companies completing IPOs since December 2007. The Wall Street Journal reports some two dozen firms have filed plans to go public in the past two months, which is twice the number who filed to go public in the first seven months of this year. Has the IPO pendulum swung back to “Initial Public Offering” from two years of “It’s Pretty-Much Over”?

If that’s not enough to convince you investors are regaining their appetite for risk, more than one billion dollars in acquisitions took place last week through special purpose acquisition companies (SPACs). What’s a SPAC? It’s basically a “blank check offering” that allows investors to raise money through an initial public offering, and then gives them up to two years to buy a business as long as the sale receives shareholder approval. Sounds pretty spaculative.

Media spending still lagging

More than one-third of marketers plan to cut their advertising budgets over the next six months, according to he latest Association of National Advertisers (ANA) study. While an improvement from the 50-percent budget cutting threshold ANA reported earlier this year, the times ain’t exactly flush for marketers or media owners. As even ANA will admit, budget cutting tends to get under-reported in forward looking surveys (turns out 61% of marketers, not 50% cut their budgets over the past six month, according to ANA research).

If you’re a media buyer, now might be the time to pounce, as traditional media owners will do just about anything to get your business. The top 100 advertisers spent 10.2 percent less than they did in the previous year, according to the latest data from TNS media Intelligence and magazine ad pages are down 22 percent through October according to the latest Publishers Information Bureau. Network TV spending was down six percent, and newspaper advertising was down nearly 11 percent over the same period, TNS reports.

Another disturbing data point for media owners is that new research indicates lead generation is what advertisers want these days, not building brands or customer “buzz.” That means every dollar counts and will be measured and held accountable. Nearly 70 percent of marketers surveyed by MarketingSherpa last month said “Generating High Quality Leads” was their biggest challenge, more than twice the number who pointed to brand building, public relations buzz and nearly twice the number who pointed to creating perceived value in “cutting edge” product benefits.

The one bright spot, not surprisingly, was Internet display advertising – up 10.8 percent -- as more marketers shifted funds online. “Perpetual movement is the essence of survival and prosperity online,” quipped Michael Moritz, the Sequoia Capital investor who backed Google, Yahoo and Sugar a fast growing consumer blog network in a New York Times interview last week. “If online media and entertainment companies don’t improve every day, they will just wind up as the newfangled version of Reader’s Digest — bankrupt.”

Welcome to Q4, the last fiscal quarter of this topsy turvey decade. Fasten your seat belts.

Summer of Discontent to Continue?

2009-09-08T09:02:00.002-04:00

All signs point to ‘not sure,’ but innovation thriving. Smart ad dollars will find the right home.

Economists and investors were buoyant Friday when the Labor Department announced we lost only a quarter of a million U.S. jobs. Despite the fact that nearly one in 10 (9.7%) able bodied Americans are now officially out of work – the highest jobless rate since 1983 – and millions more have essentially given up trying, Federal Reserve policy makers said they were increasingly confident the downturn had ended and the economy would start growing again in the second half of the year. What’s a quarter million lost jobs when we saw 700,000+ jobs evaporating monthly during the winter?

A “’jobless recovery” may be underway, but experts say we’re still vulnerable to “adverse shocks” and we’re in for a slow, halting rebound. Not exactly the powerful, “makeup-sex” kind of recovery we’ve been accustomed to when rocketing out of previous recessions. Economists say businesses will remain skittish about hiring. Income growth is sluggish. And credit is still tight for millions of households. A further drag on the employment scene is that older workers, who would normally be retiring at their current ages, are fearful of leaving the workforce as the value of pensions, 401ks and uncertainty about social security keeps them feeling anything but secure. Pretty scary, and there’s no little blue pill to fix all that.
A jobless recovery doesn’t conjure warm, fuzzy feelings for marketers, media professionals and other WANT-creators. We’re the folks who depend on businesses and households NOT being able to do more with less. They need to buy, invest, get bigger, better and of course v2.0 and new and improved.

But this trend toward austerity goes against our consumer DNA. It’s not likely to sustain itself as workers burn themselves out or find new jobs; companies lose orders because they can’t fill demand, and U.S. households, just can’t resist bargains. Demand will eventually win out over restraint, and the spending/hiring cycle will ramp up in due time. Just make sure you’re ready for it.

Unusual recession

“This has been an unusual recession in term of severity and the circumstances that triggered it,” noted Abby Joseph Cohen, president of the Global Markets Institute at Goldman Sachs in a recent interview in The Investment Professional magazine. “There has been enormous financial disruption along with a deep and painful recession.” Unlike the prior two recessions which were relatively mild and in which the economy responded well to standard pro-growth policy tools like interest rate reduction and targeted fiscal stimulus policy, the Great Correction of 2008-09 was more extreme and standard policy tools couldn’t be applied, said Joseph. It has been marked by a frozen financial system and economic climate. Goldman Sachs economists expect GDP to be slightly positive in the second half of 09, although Joseph warns the U.S. economic recovery will be linked with the global economy more so than ever before.

What could derail the recovery? Joseph points to three things:
1. Ongoing weakness in the domestic U.S. economy
2. Unresolved financial issues involving mortgages, credit cards and commercial real estate
3. Potential policy missteps in the U.S. and abroad

What’s been lost in all this consternation about the economy is the extent to which innovation (and adoption of new technology) has accelerated.

A nation of early adopters

We’re all gadget geeks now, according to a Forrester Research report released last week which surveyed more than 50,000 households in the U.S. and Canada. Researchers found 63 percent of Americans now have broadband connections, and nearly 10 million households added HDTV in the past year, a 27 percent increase.

Despite the recession, online spending remained strong, with older consumers leading the way. On average, older consumers spent on average $560 online in the past quarter, and one in five, spend over $1,000 over that period. In addition, researchers found that 86 percent of families with children had mobile phones and were more likely to use music, video playback and other advanced features.

More people are also migrating away from the home and office to access the Web via their smartphones. About 15 percent of cellphone owners were using the Internet on their phones in 2008, showing that for a growing number of Americans, there is an increasing “expectation that all the same services and resources are available to us, no matter where we are,” said Charles Golvin, Forrester analyst in a statement.

Outlook murky for ad advertising

All signs point to a relatively robust recovery in ad spending beginning next year, said Matthieu Cooper, a UBS analyst in a recently released report from his forum on the global media climate. Not everyone agrees. For starters, magazine ad pages were down 28 percent for the first half of 2009, according to Publishers Information Bureau. Again, that’s nearly 30 percent lower than the first half of 2008 – which wasn’t exactly a banner year for the print media folks.

Most analysts and ad execs agree the worst is over, but there is little consensus on the strength and duration of the recovery. One reason for caution is that advertisers are waiting….waiting …waiting to commit their budgets. As a result, ad execs and media companies say they have little clarity about spending prospects even for the short term. We may even be seeing a shift back to subscriptions, paid content and other forms of non-advertising revenue.

PWC says the gap between advertising and other forms of media company revenue will continue, as ad spending will remain below 2008 levels for at least another half decade. By contrast, spending on media and entertainment by consumers and businesses will rise to $812 billion in 2013, from $707 billion this year.

If you’re smart, you’ll embrace the new climate of working harder for your money. Marketers and media owners who really take the time to understand their partners’ needs will find a home for the smart dollars still circulating out there. Those that don’t may find themselves left out in the cold, waiting for the good times to return. And it may be a mighty long wait.

Recession’s Over (If You Still Have Customers or a Job)

2009-08-25T09:51:00.003-04:00

Savvy marketers carefully placing their bets. Research confirms C-Suite and business travelers increasingly embrace the Web. Don’t be a ‘shoulda-woulda-coulda.’

Factory output is growing again. That’s right, the smokestacks and assembly lines are humming anew as we registered the first uptick in the monthly National Association of Manufacturers (NAM) Index since December 2007. Experts say manufacturers cut production so sharply during downturn that they depleted inventories and must now ramp up production to meet demand. Any of this sound familiar to you over-reactive media buyers?

Most economists surveyed by The Wall Street Journal earlier this month believe that the recession is over – a milestone we first called in this blog back in April ("Recession Running Out of Steam"). Stocks have been rallying throughout the summer doldrums, and even Fed Chairman Ben Bernanke declared last week that the global economy is starting to emerge from recession. The S&P 500 stock index closed at a 10-month high after last week’s nearly two percent advance.

On average, surveyed economists expect to see a 2.4 percent increase in output in the third quarter, at a seasonally adjusted annual rate. Construction of new single-family homes has started to climb. Auto sales are up and even sales of existing American homes rose a surprising 7.2 percent to their highest level in nearly two years as cheaper prices and the availability of tax credits continued to entice buyers. Cynics will say it’s a bottom-feeding frenzy, with buyers pouncing in distressed and foreclosed homes. But the smart money says this is more than just a housing sector version of the cash-for-clunkers auto program.

Regular followers of this blog know we’ve seeing nothing more than a natural shakeout of home ownership as we revert to the historical mean of 63.5 home ownership among U.S. households. That’s just a tad under two out of three as we saw in the mid 1980s. Home ownership rose to about 70 percent in mid 2005, just before the bubble burst. It’s now about 67.5 percent and experts say it will gradually go back to 63-ish range over next 10 years. That’s a painful regression to the mean, but just like a .400 baseball hitter entering the dog days of August, you can’t fight the long-term law of averages forever. We love you Joe Mauer, but you can’t beat the almighty Oracle of Equilibrium of the long haul.

The labor market remains one of the biggest soft spots for the economy, though the July monthly jobs report had raised hopes that the worst may be over. Here’s another way to look at it. At no point in our nation’s history have more households felt the need to have both spouses working. And how many American households feel they can get by on just one income? Less than half. That’s right, just 47 percent, according to Country Financial’s Job Loss and Financial Security survey of nearly 800 married employees.

The flip side of equilibrium, of course, is that suffering sectors, like employment will eventually return to the historical norm of about 4.5 percent, from today’s 9.5 percent. You can bet your last Obama button we’ll get there before his first term ends and that’s a heck of a lot of jobs created.

If you buy or sell advertising, you better start taking these macro factors into account, or you’ll be caught in a media inventory shortage that could derail even the best laid of marketing plans.

Webcasting, not just a cool medium. It helps the bottom line

If the live conference and events business didn’t have enough on its plate, a new study by the National Business Travel Association found airports and local governments are not only gouging travelers with prices, but sticking it to them in taxes. The NBTA study found travelers not only pay a local sales tax, but they also spend up to 172 percent more in taxes aimed at visitors each day that they stay at a hotel, dine and rent a car.

In addition to the convenience and improved technology of Webinars, Webcasts and audio seminars, the travel industry continues to sock it to business travelers. Taxes targeting travel-related services – especially at the nation’s busiest airports, like Chicago O’Hare (no surprise), can cost a Fortune 500 company, $50 million to $60 million a year, says NBTA research. “In a tough economic environment, many state and local governments have relied on the old habit of targeting travelers to make up revenue shortfalls, said NBTA.

It’s official. The C-Suite is online

The Internet is the most important source of business information for 60 percent of top executives finds a new report from Forbes and Gartner Group.

Researchers found senior executives spend nearly 16 hours on the Web each week and nearly three in five C-Suite execs hit the Web before they go to work. When they get to work, nearly seven out of eight (86%) check e-mail and half (46%) visit Web sites BEFORE they do any other work. Here’s what they’re up to according to the Forbes/Gartner research gurus:

• 73 percent are doing research
• 65 percent are looking for business and financial news
• 52 percent are checking on competitors and industry trends
• 45 percent are seeking information about products and services
• 32 percent are investigating potential new business partnerships.

So when you’re inundated with wimpy pronouncements from the experts like “cautious optimism,” or “eventual gains” or “starting to emerge,” just think back to where we were six to 12 months ago in the depths of “doom and gloom.” We’ve come a heck of a long ways and if you don’t think that’s a turnaround, then you might want to call your physician and you’re your blood pressure checked. Now is the time to pounce on whatever delayed purchase or strategic initiative you’ve been mulling over. It’s going to be a long, long time before you see cheaper, easier, better or funner time to cut yourself a good deal.

Can Web Advertising Adjust to Privacy Rules Proposed by Big Government?

2009-08-12T15:09:00.003-04:00

Worst of recession appears over, but now real work begins in age of creative destruction.

The Fed held its ground on interest rates today. Yesterday, the U.S. Labor Department said productivity in the second quarter gained 6.4 percent -- the biggest quarterly gain in nearly six years despite an ongoing contraction in the overall economy. More than a few economists have suggested companies are adjusting to the recession by cutting jobs and workers' hours. Or maybe companies are becoming more innovative. Mind you, that’s not the same as “doing more with less” because innovation is proactive and forward-thinking. “Doing more with less” is reactionary, and often a desperation tactic that leads ultimately to worker burnout and defection – not long term profitability when the economy rebounds.

With stocks at their highest levels since autumn, interest rates holding steady, unemployment not getting too much worse at least statistically (see Wall Street Journal video report and the “cash for clunkers” program injecting signs of hope into the auto industry, some analysts are predicting a correction.

Sure there are plenty of signals about this being a “suckers rally,” but even bearish traders are giving credence to the market turnaround. “You can’t knock this market down,” Joe Saluzzi, co-head of equity trading told the New York Times last week. “Every dip is bought. Any sort of downdraft is picked up right away. I’m extremely bearish but I will not short this.” What’s more, the National Association of Realtors said the increase in pending sales – a forward looking measure of the market offered signs that the market is on the mend. New and previously owned sales have leveled off and single family home prices have begun to show some stability.

So just as consumers and businesses are getting their wallet-opening muscles limbered up, the government. may want to throw a wet blanket on the hottest area of ad growth during the past decade, including the recession.

Government online privacy rules a ‘setback to innovation’?

“We’re not committing ourselves to imposing regulation; what we would like to do is figure out useful tools and a more comprehensive way of looking at privacy protections that may obviate the need for rules,” said David Vladek new head of the Federal Trade Commission’s (FTC) Bureau of Consumer Protection in a recent statement. The message is you have to be more transparent about what you’re doing and the privacy “frameworks” the industry has been using historically are no longer sufficient, he said.

Vladek wants sites collecting personal data to get consumers consent whenever they visit the site (opt in)…. But marketers say such a tactic would be disastrous. “It’s impossible to communicate the value prop to a consumer at the point of and advertisement,” Matt Wise CEO of Q Interactive a Chicago online marketing firm told the New York Times and other trade media last week. It would be a tremendous setback to innovation.“

At HB, we think the solution relies somewhere in between in the form of a mutual trust system between innovators and regulators. Marketers and other data gatherers need to be more accountable, if not necessarily transparent, to regulators and consumers about the proprietary personal data they’re gathering – and how they’re gathering it. On the flip side, regulators need to take the time to understand fully how the online marketing mechanism works, why it’s so powerful, and how it’s changing the future of commerce worldwide. Regulators, shouldn’t be allowed to introduce sweeping legislation to punish a few bad apples, without fully understanding the industry they’re trying to govern. Otherwise their actions could bring one of the few growing sectors of our economy to a halt. And that includes emerging platforms such as online video (see below)

Keep your eye on online video

Online video viewing has grown across all age groups, according to new research (pdf) from the Pew Research Center's Internet & American Life project. Not surprisingly, young adults continue to lead the adoption curve in online video viewing, though adults ages 30-49 also showed big gains over the past year; 67 percent now use video-sharing sites, up from 57% in 2008 according to the Pew study, Researchers found nearly two thirds (62%) of adult internet users have watched online video on a video-sharing website, a figure that has nearly doubled from 33 percent in 2006. The study also found that 19 percent of online adults use video-sharing sites on a typical day (compared with 8 percent in 2006).

While much of the content on video-sharing sites is still user-generated, a growing archive of professional content is becoming increasingly available through YouTube and network-sponsored video portals such as Hulu, MarketingCharts reports. In response, more than one-third (35%) of internet users now say they have viewed a TV show or movie online. This compares with just 16% of internet users who had watched or downloaded movies or TV shows in 2007.

Video outranks social networks, twitter

Pew noted that the use of video-sharing sites currently outranks many other online pastimes of American adults, though video viewing does not always get a proportionate amount of media attention. Watching online videos on sites such as YouTube and Google Video is more prevalent than the use of social networking sites (46% of adult internet users are active on such sites), podcast downloading (19% of internet users) and the use of micro-blogging tools such as Twitter (11% of internet users).

The darkest days are over, but the good times are a long way off. Innovation, whether benign or in the form of “creative destruction” is the only thing that will get us back on the path to prosperity. Let’s just be responsible about how we innovate (or monitor those who innovate).

Dow Holds Above 9,000. Home Sales Improve

2009-07-29T18:50:00.005-04:00

Recession innovators extending lead over the pack. Mobile advertising gains.
In most parts of the United States, the recession seems to be losing steam and economies are beginning to stabilize, the Federal Reserve said today in a snapshot of economic activity from across the country. This assessment is based on the Fed’s latest “beige book” (PDF)which gauges economic conditions from 12 distinct areas of the country.

“Recession is over, economy is recovering — let’s look forward and stop the backward-looking focus,” John E. Silvia, Wells Fargo’s chief economist, wrote yesterday in a research note.

We're one-third of the way out of the recession, according to Kiplinger's Recovery Index, which tracks six key economic indicators. The National Association of Realtors (NAR) just said that sales of previously occupied homes rose 3.6 percent last month, the third straight month to do so. It was the highest level of sales since October 2008 and beat analysts expectations. Meanwhile, the Case-Shiller index of home prices in 20 metropolitan areas, produced by Standard & Poor's, rose 0.5% in May from the month before, the first increase after 34 straight months of decline. If you’re keeping score, the median sales price nationwide is now up to $181,800, up from 174,700 last month -- still 15 percent below $215,000 a year ago – but a key positive trend to be sure.

According to Kiplingers, home prices may be bottoming out after two years of decline (some say they bottomed out six months ago), but at least people are buying stuff. Said the Kippies: "Home sales activity is a key indicator of the economy's health because buying a house involves such a large commitment of funds, reflecting confidence about the future. Rising home sales also show that banks are willing and able to lend, which is another requirement of a healthy economy."

But, what about the sky high unemployment rate? Oh that. Jobless claims are still at record highs, but since unemployment lags behind other economic indicators, that’s not the downer it may appear – provided you’re among the lucky few still working. Breaking from historical patterns, the unemployment rate -- currently at generation-high 9.5 percent -- is ONLY one to 1.5 percentage points higher than would be expected under one economic rule of thumb, Lawrence Summers, President Barack Obama's top economic adviser told the Wall Street Journal last week. Since the recession began in December 2007, the economy has lost 6.5 million jobs, 4.7 percent of total employment. The unemployment rate has jumped five percentage points, while the economy has contracted by roughly 2.5 percent.

If you can take a moment to ignore the painful shrinkage to your retirement account, investments and college savings plans, the midsummer stream of earnings reports from major companies is refreshing, and so is the market's reaction to them. So far, July's quarterly results are reassuring in the macro view. Neither the economy nor the indexes are on the verge of backsliding, and they've helped push the Dow above 9,000. Some 61 percent of the companies in Standard & Poor's 500-stock index to report for the quarter beat analysts' forecasts.

White House budget director Peter Orszag and Fed Chairman Ben Bernanke have all talked publicly about the unusual disconnect between growth and employment. Though today's disparity between growth and jobs is especially stark, a jobless recovery wouldn't be new: The past two recessions were marked by firms reluctant to resume hiring right away after demand recovered. The current disconnect could reflect an unanticipated surge in productivity -- companies finding ways to increase output with fewer workers. That could set up the economy to grow rapidly in future years. Rising productivity is the linchpin of economic growth and rising living standards.

As history shows time and time again, if the wisdom of the crowd thinks things are getting better, then they eventually WILL get better, because so much of our economy (and marketing strategy) is based on psychology, rather than true fundamentals. as we predicted earlier this year (“Recessions Can Spawn the Best Ideas”) companies that hunkered down during the depths of the downturn – rather than full scale retreat – are starting to show the fruits of those decisions.

Innovation Rules

Last week Apple Computer reported its best non-holiday quarter ever -- earnings up 15 percent -- despite continued malaise in the overall electronics sector. Meanwhile the U.S. financial markets leapt to their highest level since November on news that The Conference Board’s Index of leading economic indicators rose for the third straight month in June. While the increase was a modest 0.7 percent, the index hasn’t had a three-month win streak since 2004 and seven of the 10 data points it tracks showed improvement including building permits. The S&P 500 Index – in which 70 percent of companies have posted better than expected earnings -- is up 5.3 percent for the year and up 41 percent since its early March nadir. The broader Wilshire 5000 Index is up 7.5 percent for the year.

Analysts point to unexpectedly strong sales of Macintosh computers and a surge in iPhone purchases. We’ve been banging the “innovate when times are worst” drum for months here in this blog and Apple’s an example of why. Its products work and function the way the human brain thinks. {Disclosure: we have not financial or promotional interest in Apple Computer, Inc.). Apple customers – not corporate I.T. wonks or Indian outsourcing farms – control the customer experience.

“We’re making our most innovative products ever and our customers are responding,” said Steve Jobs, Apple CEO in a statement. Shaw Wu, a Kaufman Brothers analyst, told the New York times that Macs were “resonating with increasing numbers of customers, as it is arguably the best platform for what people do today, which includes Web surfing and creating and managing content.”

Thanks to the Web, the rules are dramatically changing in the music industry too. The Internet, not record labels, is increasingly calling the shots when it comes to promoting and distributing music. Physical album sales fell 20 percent to 362 million last year, according to Nielsen, but sales of individual digital tracks rose 27 percent to 1.07 billion – that’s right billion – more than enough to make up the shortfall.

Major record labels no longer have an iron fist on creating and selling professional music and getting air time on the radio. Polyphonic and other savvy startups are running their record labels like VC firms, by investing in promising bands, allowing them to record their own music and choose outside contractors to handle their publicity, merchandising, touring, etc. Instead of groveling for advances and praying for royalties if they create a hit, musicians share in all the profits from their music and touring. Guess what, they’ll also maintain ownership of their own copyrights and master-recordings. Can you imagine Sony, Warner or EMI cutting deals like that with up-and-comers, let alone their stars?

The year of the true multimedia campaign?

Three in four (74%) of advertisers using the Internet are doing so more than they did a year ago, while half (49%) who use print are using it less, according to a recent Linked In / Harris poll (PDF) of 1,015 ad agency and marketing execs nationwide. The poll not only found 69 percent of mobile marketers are using the medium more than they did a year ago, but more than half of online advertisers overall, are using the Web as part of a broader multi-media campaign. Just one in seven (14%) Web advertisers, are committing dollars only to online.

We’re not out of the woods by a long shot. But those who continued to trust their instincts, resourcefulness and innate sense of direction during the darkest days are going to be the first ones seeing the clearing through the trees.

Ad Spending Plans, Economic Indicators Trending Up

2009-07-23T08:53:00.005-04:00

Will agencies, consumers join the party? Business Week on the block.

Business Week is officially up for sale and there ain’t exactly a bidding war brewing for the once venerable bible of the business world. The nationwide unemployment rate closes in on a generation-high 10 percent and housing prices languish, yet new research indicates economic pessimism among marketers, and to a lesser extent, agency media buyers appears to have bottomed out last spring. NOTE: If you recall, we called the recession statistically all but over in this blog back in early April although we cautioned it could take 12 months or more for spending, confidence and decision-making to improve.

Ad spending was miserable in the first half of 2009 –- down nearly 15 percent according to Interpublic group -– but ad spending PLANS are now trending upward, according to a new report from Advertiser Perceptions Inc (API). API says Cable TV and outdoor media also are improving and now have more media decision makers planning to boost their budgets than to decrease them over the next six months, and while broadcast TV, radio, magazines and national newspapers all are still negative on balance, they are also all improving from low confidence points earlier this year.

"Leading the way are marketers, who are more optimistic than their agencies," said API partner, Ken Pearl, in a statement. API historically conducts big semi-annual surveys tracking the perceptions of advertisers and agency media buyers about the major media, including their confidence levels, but opted to conduct the confidence tracking more frequently this year to monitor an inflection point in the advertising economy.

The most recent survey, which is based on the responses of more than 200 media decision makers over the past several weeks, indicates that their plans for most major media are once again ascending, especially among marketers who seem slightly more optimistic than their agency counterparts.

Ad Optimism Is Improving For Most Media, High For Mobile/Online

MEDIA ....“OPTIMISM”...........STATUS........TREND
Mobile ......57............. Optimistic....Improving
Online.......53..............Optimistic....Improving
Cable TV.... 17..............Optimistic....Improving
Outdoor......12..............Optimistic....Improving
Broadcast TV.-7..............Pessimistic...Improving
Radio........-12.............Pessimistic...Improving
Magazines....-17.............Pessimistic...Improving
Natl. Newsp..-36.............Pessimistic...Improving
Local Newsp..-47.............Pessimistic...Declining

Source: Advertiser Perceptions Inc. "Optimism" is defined by the number of percentage points separating the percentages of respondents citing plans to increase or decrease their advertising budgets in each medium over the next six months. Trends are based over three bi-monthly tracking reports conducted so far this year.

“It's imperative that we begin to shake up the way we think about traditional media,” commented a reader of Joe Mandese’s popular MediaPost column. “It's a fallacy that each medium is an island unto itself. We must move into a new phase of using all the media we have available to us in concert with one another.

Said another poster: “Being in Media ad sales it is good to see a positive trend at last. This generally means that business is starting to move past the current recession. Since the Fall is buying season it would be nice to hear something other than ‘no budget’”.

Let’s hope marketers and agencies are putting their money where their mouths are and focusing on the road ahead, not the rear view mirror. Just make sure you folks stay off your cell phones when driving.

You Can Stimulate Your Way Back to Stability

2009-07-08T09:25:00.004-04:00

But you can only invent your way back to prosperity.

“Historically, recessions are a time when new companies are born and great companies separate themselves from the competition,” quipped Thomas Friedman last week in a NY Times editorial.

Amen to that, Tom, who opined further: “We might be able to stimulate our way back to stability, but we can only invent our way back to prosperity. We need everyone at every level to get smarter.”

Getting companies smarter is more easily said than done these days, but it’s happening and not just at Google, Amazon and Facebook.

The Times’ Friedman still believes America, with its unrivaled freedoms, VC industry, research universities and openness to new immigrants has the best assets to be taking advantage of this moment – to “out- innovate our competition.” Unfortunately, most corporate coffers are nailed shut. Easy bank financing is a faded memory and venture capital is going through a seismic contraction.

“Personally I think the funds have gotten too big. Our biggest challenge is to think smaller and make smaller, smarter investments,” noted VC icon, Alan Patricof of Greycroft Partners at a recent venture investing conference in San Francisco.

According to the National Venture Capital Association, investment in venture capital funds shrank to $4.3 billion in the first quarter of 2009, from $7.1 billion in the same quarter of 2008. That’s a whopping 40-percent drop, but some experts think it’s a blessing in disguise, because it lowers the flow of capital into these funds. There won’t be as much excess money chasing bad deals and the VC industry may start seeing double digit returns some day. NVCA says investors are seeing about six-percent annually on their money over five years, down from 48 percent annually at the start of this decade.

With easy bank financing and easy VC money a thing of the past, organizations large and small are going to have to keep operating smarter.

More proof against cutting back on ads in a downturn

Just as cutting back on innovation during tough times comes back to haunt you when better times return, dramatically cutting back on advertising can be severely damaging to your market share and reputation.

Two recent surveys surveys of banking and retail consumers by research firm, Ad-Ology, found advertisers who cut back substantially during the downturn are building negative brand association. For instance:

• 48% of respondents agreed such advertisers “must be struggling”
• 12% of responds agreed “they may not be in business much longer.

Could good ol’ common sense be making a comeback? Read below for two examples.

Pearls of wisdom from the common-sense department

Generic Web site names that are self-explanatory deliver much higher click-through rates than a more abstract or clever name, says a new study by Memorable Domains. The study compares three sites using AdWords pay per click campaign for ads for electric bikes. “ElectricBicycles.co.uk” got 45 percent more clicks than “YourBikes.co.uk” and 105 percent more clicks than “InaHurry.co.uk”

Why? Experts says the self-explanatory site name makes sense and reassures prospects to see search terms reflected in a Web site address.

Tech companies: research says disclose price info if you want to make the sale

Many marketers are reluctant to disclose prices online, but that’s what many prospects want. According to a 2008-09 Marketing Sherpa {www.marketingsherpa.com} survey of 3,108 decision makers. Eighty-nine percent agreed that a technology vendor got the sale or inside track for a sale at their company because they were more open than rivals about their pricing.

There’s never been a better time to re-examine every way you do business, from selling into new markets, supporting existing customers and developing new products and services. But, while your immersed in financial navel-gazing, remember, you’ve can’t neglect to keep the advertising and marketing faucet turned on. And while you’re at it, make sure you tell ‘em exactly what it is you do and how much you charge. It’s just a matter of how (not how much) you choose to invest your marketing dollars in explaining your value proposition.

Turning the spigot on and off as business conditions fluctuate isn’t the answer. Your customers will see through the ruse during good times and forget about you when times get tough. Not only will you fail to separate yourself from the competition, but your competitors will start separating you from your long-time customers.

Mid-Year Media Reflections

2009-06-24T09:51:00.005-04:00

Digital drives ad industry growth and business models. But it’s not all about the new.

Whether or not we’re pulling ourselves out of this (hopefully) once-in-a-generation economic quagmire remains to be seen. New jobs are being created, but the rate of unemployment is at 25 year highs in most parts of the country. The financial markets surged 40 percent after hitting 12-year lows in March, but they’ve been stuck in neutral the past month and most indices are about where they were at the start of the year. That means, investors haven’t lost real money, but they’re not keeping up with inflation either. Home sales are rising, but the median price of homes continues to plummet. Interest rates remain at historic lows, but no one’s really in a position to act on the bargain rates.

Despite this macro-inertia, it’s heartwarming to see that as in tough times before, innovation is thriving – no thanks to the venture capital community -- and long delayed-tough decisions are being made across all industries and walks of life.

In the media business, newspapers and magazines are taking it on the chin as both subscribers and advertisers are fleeing to more immediate and lower-cost outlets for news, information and entertainment. No surprise there. Some of the lost advertising and subscription revenue will return when the economy rebounds, but the rules of the game have changed so much that the tipping point has long since been passed.

What’s most striking about the media landscape in this downturn is that the audience (not the media gatekeepers) have stormed the cockpit and taken over the controls. Whether you’re in old media, new media or somewhere in between, you better get used to the idea that the audience/customer is calling the shots, not you. Get used to it.

Audience in control

Christian Dirschl, Content Architect for global information company Wolters Kluwer calls it the 4A’s: “Anyone can say Anything about Any topic at Any time.”

As Michael Marcel Fenez, Global Leader of Pricewaterhouse Coopers’ Entertainment & Media practice observed in a report released last week, “The accelerated migration to digital technologies has reinforced and proliferated new consumption habits and ‘digital behaviors’ as consumers seek more control over where, when and how they consume content while, more than ever, watching their pennies and seeking the best value from the choices they make.”

Over the next five years, PWC projects newspapers will lose $13 billion, dropping about 32 percent of its advertising revenue as digital technologies become increasingly widespread. The report expects print advertising overall to fall the most from $36.7 billion in 2008 to $24.3 billion in 2013. Online advertising revenue is anticipated to decline over the next two years. PWC expects online ad revenue to grow at a 2.5 percent compound annual rate from 2008.

Can’t hide from the digital migration

Fenez says the economic downturn has accelerated and intensified the digital migration among both providers and consumers of content. “Companies who grasp the opportunities which are appearing in this fast changing marketplace and are agile enough to adapt their business models will be able to take full advantage of the potential and new revenue models as they emerge.”

For instance, end-user spending through digital/ mobile platforms accounted for 23.4 per cent of the overall consumer/end-user/ access market in 2008 and should account for 78 per cent of total growth during the next five years, says PWC.

Consumers are taking control in various ways.

• They’re “time-shifting” via digital video recorders and video-on-demand to free them up from the TV schedule enabling them to watch what they want when they want.

• Increased broadband penetration is enabling them to get what they want from wherever they want while improvements in technology allow better downloading and streaming.

• Growth in mobile access is allowing consumers to access the Internet from any location and giving rise to the popularity of high-end devices such as smartphones, iPods, and the Kindle that combine mobility and access.

• The advances in digital music are also allowing consumers to purchase songs individually through digital channels (unavailable in physical format) and generating growth in “sideloading,” which allows consumers to buy music less expensively online, then transferring that music to mobile devices.

The changing face of advertising

PWC predicts that over the next five years, as consumers receive an increasing proportion of their E&M through digital/mobile platforms, advertisers will shift their resources to reflect the increasingly fragmented ad market. In the mobile arena, opportunities across the advertising continuum will enable the growth between brands and consumers, ranging from click-through banner ads and pre-roll ads on video clips through coupons and online subscriptions.

The growing proportion of Internet and mobile advertising in the overall global advertising mix will rise from around 12 percent in 2008 to 19 percent in 2013.

Age of accountability

However, the migration reinforces the need for greater transparency and accuracy over audience metrics which together with accountability for ad results, is becoming a “must have” in this new media world.

“Though operating in challenging and fast-moving times, this has never been such an exciting time for the industry,” say Fenez. “The accelerating digitization is why there is no place to hide from new models and dynamics across the industry. The winners will be those players who focus on driving and leading change that delivers real value for consumers.”

It’s Not All About the New

“Never adapt technology for the sake of technology,” cautioned Richard Oppenheim in a recent CPA Technology Advisor editorial. Make decisions based on usability and company business support. Technology requires frequent assessments that are often confused by the emotional pull of the new, the sexy and the visually gorgeous. Knowing how and when to make the decisions to change technology means doing evaluations and analysis that effectively measure the impact of that change on dollars, resources and people.”

Great ideas can come from anywhere at any time from all types of people and organizations. Don’t throw out the old, just to make room for the new, but keep your eyes wide open for new opportunities, apps and technologies that can bring fun and bottom line value to your business. Explore everything. It doesn’t matter if you’re currently twittering or tweeting, just keep testing, tweaking and exploring.