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.
VCRGD6XDXT3T
Monday, August 23, 2010
Monday, August 09, 2010
Accelerating in a stalled economy?
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?
VCRGD6XDXT3T
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?
VCRGD6XDXT3T
Thursday, July 22, 2010
‘Unusually Uncertain’
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
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
Thursday, July 01, 2010
Business Marketers at Mid-Year Crossroads
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
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
Saturday, May 29, 2010
Survey Indicates Business World More Complex Than Ever
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
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
Wednesday, May 12, 2010
Markets and Economy Slog Through Fortnight of Tests
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
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
Monday, April 26, 2010
It’s Official. Internet Ad Revenue Surpasses Print
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
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
Monday, March 22, 2010
Tipping Points: Digital Ad Spending to Top Print in 2010. Facebook Overtakes Google.
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.
VCRGD6XDXT3T
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.
VCRGD6XDXT3T
Tuesday, March 02, 2010
Mixed Signals on Economy, Media Consumption Patterns
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
VCRGD6XDXT3T
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
VCRGD6XDXT3T
Saturday, February 06, 2010
iPad One Week Later
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.
VCRGD6XDXT3T
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.
VCRGD6XDXT3T
Monday, January 25, 2010
Get Ready for the Always Wired, Multi-Tasking, Short Attention Span Customer
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.
VCRGD6XDXT3T
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.
VCRGD6XDXT3T
Wednesday, January 06, 2010
Farewell and Good Riddance to the Decade of Disruption
‘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.
VCRGD6XDXT3T
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.
VCRGD6XDXT3T
Sunday, December 27, 2009
Saving is cool again. Is that bad news for marketers?
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.
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.
Friday, December 04, 2009
Study: Ad Spending Plans Returning to Pre-Recession Levels
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.
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.
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