Subscription services for milk and ice have pretty much dissipated in favor of the grocery store (a platform change) because today’s supermarkets have become more convenient and provide us with more options. In some rural areas, food home delivery services are still very popular because the menu choices (features) and convenience make home delivery a better offering, just as the features and ease of online shopping are often superior to in-store shopping, even though the retail outlets may be down the street.

The most basic takeaway here is that a subscription model or platform change works if you offer the consumer something he or she wants but can’t get anywhere else, or you provide benefits of such significance that a consumer’s marginal utility increases more than any incremental cost. If we apply these teachings to Internet-delivered video, we realize today’s Internet video subscriptions or “for pay” video offerings make sense for (1) premium content that isn’t readily available on television, (2) premium content that is far superior because of platform features or quality, and (3) premium content that is more conveniently obtained because of the platform.

MLB.com and TennisTv.com are examples of premium content offerings that aren’t available on television. Consumers are subscribing to these offerings for the same reason they bought cable in the 1980s :”I want it and it isn’t available elsewhere.” Though not subscription-based, PBS recently enhanced its PBS KIDS GO! children’s site with in-video interactive content. After the interactivity was added, viewership and engagement skyrocketed as PBS leveraged the technology platform, making the content experience superior for its audience. Reasonably priced, choice-rich and easy to obtain, movie downloads should also succeed because of the convenience factor, just as iTunes and NetFlix have been doing.

Hulu and others on the Internet are certainly on their way to achieving the “for pay” value proposition. But before we can get the consumer dollars en masse — whether by subscription or advertising — we (the industry) need to concentrate on providing content and adding value that is unique to our platform and industry. Consumers will then, and only then, be willing to switch or augment their subscriptions.

Source: Media Post Publications

“It’s a very tall marketing challenge and a very tall product challenge,” Yusuf Mehdi, SVP of Microsoft’s online services division, told the Times. “It’s going to take multiple steps to get where we want to go, and this is the first step.”

On Monday, Hulu will run a telethon-style commercial called a “Bing-a-thon,” beginning at 8 p.m. (Eastern Time). Los Angeles-based Creative Artists Agency developed the program, according to the Times.

Hulu Desktop is a lean-back viewing experience for your personal computer. It features a sleek new look that’s optimized for use with standard Windows Media Center remote controls or Apple remote controls, allowing you to navigate Hulu’s entire library with just six buttons. For users without remotes, the application is keyboard and mouse-enabled. Hulu Desktop is a downloadable application and will work on PCs and Macs. It will initially launch as a beta product during which we plan to gather and incorporate user feedback to improve the service.

Watch the video

Yet it’s still not ready for real TV viewing. For now it’s decidedly a PC experience.

Hulu began offering the application for download Thursday.

The IAB recently distributed its 2008 online advertising spending report. The gist is that online spending will continue to grow but not at the steep rate that analysts initially projected. While other advertising channels are facing dire straits, online is still poised to gain sizable share of marketers’ overall budgets. The industry has come a long way from the eras when traditional marketing channels dictated how consumers interacted with advertisers. As the digital space evolves, the way marketers communicate with their consumers follows suit. With each new platform, marketers have another option to add to their mix, but marketers should not rush onto a new platform just to mark their territory.

Marketers need to balance the pros and cons of being a part of an emerging platform. The lure of being first is enticing because the companies that are first to make an impact in a digital realm are cemented as innovators. But you can’t wait too long as the risk of not adapting to changes fast enough can be substantial as there are several industries — like print media — that are unable to gain market share because they were absent for too long. Taking both extremes into account, marketers need to exercise their discretion to identify how, where, and when they fit into trends.

Let’s take a look at how to adapt with digital trends in a timely, brand-appropriate manner.

Think before you act
Digital marketers are always in a rush, and it’s always been this way. In the beginning, websites went live haphazardly — without much thought going into objectives, content plans or maintenance resources. Thankfully, the “build and they will come” mentality has faded, but marketers are still grappling with how to meaningfully engage with users on newer platforms. Marketers need to continue to identify points of synergies between their various advertising channels — whether it’s point-of-purchase or social media platforms. We need to continue the evolution away from the early days where campaigns were launched to keep pace with fads. These days when budgets need to be stretched, it is crucial to rely on strategy and plan executions around consumers — not just competitors.

Don’t forget: Consumers have control
Anonymous peer comments now carry the same weight as a recommendation from a trusted friend. BazaarVoice sites that 90 percent of consumers trust the reviews they read online prior to making a purchase. Digital marketing is a dialogue where anyone has an equal voice. This has created an environment where content is created in response to user behavior. Marketers need to take cues from their consumer base in all areas of digital marketing as a move in the right direction. Components like SEM strategies, conversion funnels and creative executions can and should reflect consumers’ affinities –not advertisers’ — to be effective. This is one of the hardest changes for marketers to absorb, but it is the most important. In the digital realm, marketers need to interact with – instead of bark at — their users. No matter how much sense it makes at the drawing board, keep messaging user-centric.

Make digital marketing work for you
For the most part, marketers are now in a state of flux where they are reevaluating and revamping their online properties. Emphasis is on creating holistic marketing plans where each advertising component augments one another to achieve goals efficiently. The goal is to create a plan where the whole is greater than the sum of its parts. To keep up with consumers, marketers need to scrutinize each available platform and try to prepare for the ones on the horizon. All decisions should be made with the premise of “Are my consumers here? Does this make sense for me?” If your consumers are not on MySpace, then don’t worry about this forum and allocate resources elsewhere.

Don’t miss the boat
The pressure for marketers to keep ahead of the evolving digital space is not going to let up because there are consequences for failing to adapt. Print journalism serves as a perfect example of this. The ironic part of their situation is that these publications are inherently well-equipped for success online. They provide consumers with unique content, have earned a reputation for being credible, and have a high level of brand recognition. The lack of website visitors is not because everyone suddenly forgot what the Chicago Sun-Times is. The issue was created because other online properties were quicker to disseminate and aggregate news. They established themselves as the online experts, and traditional publications never quite recovered. Does this mean that newspapers and magazines are doomed? Absolutely not. Traditional media outlets just need to refine their value propositions and offer users something that other outlets are not equipped to execute. The key will be to attract users from other sites to their own, and find novel means to syndicate their content. This can be accomplished by providing news feeds directly to influential bloggers (who can attribute and link back to the source), sponsoring user-generated news contests or offering more feature stories.

Learn from mistakes
Marketers can learn a great deal from the current state of affairs in the print world. The first is to listen to your consumers. Particularly when dealing with social media, it is crucial for marketers to observe their consumers in action before intruding on the conversation. The same goes for any digital marketing plan like website redesign, search engine marketing, or mobile marketing campaign. Marketers need to survey the landscape they are about to enter to ascertain how they can add value to it. Without this step, users will not take kindly to a marketer’s presence. Secondly, once it is determined that a move is warranted, marketers need to establish clear objectives for each component of their online marketing mix to ensure that the goals compliment corporate goals. A third step needs to be implementing tracking mechanisms wherever possible to base future planning on unbiased data. This ensures that campaigns are driven by consumers and not marketers’ intuitions.

Lastly, marketers need to make each execution count. Unlike other forms of marketing, the internet has a memory. If a company launches an ineffective offline campaign, it can fade with time, but online, content is cached, downloaded, shared, posted, and syndicated to the point where it is all but impossible to erase a poor advertising decision. This is why marketers need to take extra caution with their digital marketing plans.

Success in an ever-changing marketing arena boils down to being strategic, interactive and making each component work together. It’s important to note that a company cannot be everything to everyone, so decisions must be made to resonate with targeted consumers. Quality always trumps quantity in the long run.

Source: iMedia Connection

A major component of media buying is building relationships. A sizeable portion of a media planner’s role is to forge and cultivate associations with vendors and partners. While these bonds are the foundation of any good marketer/vendor relationship, it is important that planners objectively evaluate their buys. This neutrality is especially crucial as ad networks are continually evolving, so sticking to familiar vendors could mean that inventory and properties are overlooked. Planners must be sure to consider all of their options to best serve clients. Successful campaigns, long-lasting client relationships, and industry credibility depend upon this.

Using familiar vendors and advertising networks is not necessarily a negative quality of a media planner. When all things are considered equal, great customer services and responsiveness oftentimes sways a media planner’s decision to choose a particular vendor. It is only a problem if viable advertising options are neglected to favor preferred vendors. To get a broad perspective of possible pitfalls, I asked my colleagues at Geary Interactive to share their insights.

Here are five things a media planner can do to execute campaigns objectively.

Don’t stick to what you know
To ensure that media buys do not favor one vendor over another, planners should conduct a thorough proposal process whenever time permits. By casting a wide net, planners can make sure they are basing their decisions on competitive quotes — not bias. It is easy to return to vendors that have performed well in the past, but before each media buy, planners should reevaluate the landscape to secure the best options to meet clients’ goals. Of course, media teams should include known and trusted vendors in the RFP process, but no one should feel obligated to go with familiar vendors. The important thing is to make smart buys that contribute to campaign objectives.

If vendors question why they weren’t a chosen buy after a proposal process, make sure to provide honest feedback about how a decision was reached. Even providing a high-level explanation can keep relationships intact and maintain amicable foundations for future campaigns.

Focus on goals and research
Base media buys on success metrics as opposed to personal recommendations. Representatives promote their own platforms (as they should), but that does not mean their recommendations will best serve a campaign. Their recommendations might be effective but not necessarily a good fit for your given situation. As the liaison between marketers and vendors, it is up to a media planner to focus on buys that support goals — not just activity. By combining their own research and vendor recommendations, media planners can rest assured they are making educated buys. Turn to vendors to get their opinions, but do not follow them blindly. Instead, ask them for hard numbers that you can compare to your own research. Before finalizing a media buy, refer back to the client’s desired goals to ensure they are in alignment with your recommendations.

Respect different variables
Any number of variables can impact the success of a campaign. Creative design, targeting, competitive landscape, and seasonality are just a few components that influence a media campaign. Each variable needs to be viewed as a separate entity when gauging the success or failure of a campaign. When deciphering the results of a campaign, planners need to view it from a holistic perspective. A planner should not attribute the success or failure of a campaign on solely one factor or a single vendor.

Don’t judge a vendor by a rep
The above recommendations will help media planners avoid favoring vendors where relationships have been established. What about the opposite? It is also important for planners to avoid writing off an ad vendor because they had an unpleasant encounter with one of its representatives. In these instances, it’s even more crucial for media planners to set their preferences aside and make choices based on data and research. If a campaign requires ample management from a vendor, planners can politely ask for a different representative. The vendor wants to encourage lasting partnerships, so they will usually oblige to maintain the relationship on their end.

Finding a balance
Each campaign is different and can be based on a variety of goals and objectives. To account for this, planners should approach each project with a fresh perspective and notice when past experiences are impacting current campaign planning. In a perfect world, marketers could disregard earlier vendor relationships, but the knowledge gained with each execution can be helpful in other instances. The disconnect can be seen when working with vendors that reach similar verticals or age groups. While planners should make an effort to treat the campaigns as unique, tapping into this baseline information can help optimize new buys — especially when timelines are short. Media planners need to find the appropriate balance where insights do not become assumptions. Assuming that one campaign will generate similar results with different variables can be dangerous.

The consolidation of ad networks
Media fragmentation is a challenge digital media people face every day. The diverse landscape of media platforms forces planners to choose where they purchase ad space, and these decisions directly impact the users they reach. Although fragmentation has been a growing problem over the last decade as digital platforms have evolved and matured, most predict that this era may be over. Ad networks are beginning to consolidate into vertically specialized groups. This merging will allow media planners to more effectively use the billions of bulk impressions available on a monthly basis to reach their target audiences through a shorter list of media vendors. It will also afford media planners easier access to best-of-breed targeting technologies. With these evolutions on the horizon, marketers can reevaluate how they buy digital media properties and make sure buying habits are sensible.

Conclusions
These suggestions are meant to illuminate underlying biases that might affect how marketers buy media space. It will never be possible for media planners — or anyone else — to be completely unbiased. However, it is a good goal and a mental check. By acknowledging that there are tendencies to favor vendors, media planners can be aware of their biases and make corrections if needed.

Jinenne Sutherland is director of media services at Geary Interactive.

Source: iMediaConnection

Take online video, for example.

A few short years ago, the term “online video” was wishful thinking. Clips could only be slowly downloaded. They had to be viewed in tiny windows on the computer screen. Sound and graphics were primitive. Video was hardly a killer app.

But then, in a rush came—sometime between 2005 and 2006—YouTube in the US, Dailymotion in Europe and Tudou in China, video-sharing sites that all had three basic elements in common:

• Flash Player technology that enabled instant viewing in the browser, without downloading
• Upload-ability that made file-sharing with friends (as well as viewers around the world) quick and easy
• Embedding code that allowed users to post video clips on Webpages and blogs

Suddenly video was an open, consumer-driven platform, with virtually no cost of entry. As a result, online video moved from niche to mass market, and in the process became one of the fastest-growing media platforms in history.

According to “The Global Web Index,” from Trendstream, with research conducted by Lightspeed Research, early this year 72% of US Internet users watched video clips monthly—making video bigger than blogging or social networking.

According to the survey, 62% of US Internet users watched at least one clip a week, a figure that Lightspeed analysts translated into 97 million weekly viewers.

By contrast, Nielsen Online pegged the number of US online video viewers in April at nearly 117 million.

That scale of usage would mean online video in the US is now as big as network TV.

“This research shows that in just three years we’ve reached a watershed in the way that consumers expect to watch, contribute and share video content,” said Tom Smith of Trendstream. “Web users want to participate at every stage, including the creation and sharing of material.”

The age of online video viewers trends younger: 82% of teens (16-to-17-year-olds) and young adults (18 to 24) streamed video, compared with 73% of Generation X (25 to 34) and 65% of older boomers (55 to 64) who said they watched.

Online video-sharing was less common, with only 46% of users participating. While teen, young adult and Gen X sharing percentages hovered around 50%, the older the Internet users, the less likely they were to send videos.

One-half of all respondents shared videos via e-mail to friends and family. Twenty-three percent sent video out to friends on social networks, 21% by instant messenger and 14% to their friends on video-sharing sites such as YouTube and Hulu.

The most widely used platform for discovering and viewing video online was YouTube, followed by e-mail, music sites, Yahoo! and news sites.

Sharing appears to happen mainly among close friends, as 72% of video-sharers sent to just one, two or three people.

“Those who access video are completely engaged in the content that they choose to watch,” concluded Mr. Smith. “It’s an impactful universe.”

Source: eMarketer MAY 28, 2009

• Burst Media / PointRoll: an ad network can now serve rich media ad units from a specific vendor.
• YuMe / PointRoll: a video ad network can now serve rich media ad units from a specific vendor.
• DoubleClick / Gigya: DoubleClick can now widgetize its rich media banners. Sounds like the Clearspring / PointRoll announcement — last December.
• Eyeblaster is busy IPOing.

So once upon a time, rich media was new. PointRoll was pioneering expandables, and Klipmart was making moves on the video front. Now rich media vendors have largely commoditized duplicated products.

The fact that they’re now pursuing integration with video advertising is expected, and the fact that they’re widgetizing their banners is only interesting to the extent that marketers and agencies can make creative that a user would even want to grab and share. In fact, in a paradigm where two clicks in a hundred are considered exemplary, what smaller fraction is going to want to save the ad and take it with them?

But all hope is not lost for rich media. In fact, there are four things that could bring sexy back to rich media, as well as some encouraging signs that it’s already on its way to success.

Author notes: Julie Ruvolo is director of business development at DivX.

Rich media is still a labor-intensive process to integrate. With the advent of distributed media (media players, widgets, apps), things are getting more complicated, not simpler.

Less time spent on integration is more time spent on creative. Here are two examples of how to simplify rich media integration on the publisher side, which in turn makes things easier on the agencies:

The Rubicon Project
Rubicon is an ad network optimization system. Publishers drop in Rubicon’s code, and through that code, Rubicon serves ads from any number of ad networks (60 and counting) and optimizes for the highest eCPM. Whatever rich media campaigns an ad network is already running can display on the publisher’s site, meaning they don’t have to do any site-specific rich media integration. And agencies can stop worrying about preferred vendors, lag time for publishers to integrate new vendors and other obstacles. As Frank Addante, CEO of Rubicon, explains, “We don’t have any preference to an ad network or a website or any one rich media vendor. Our job is to make sure they’re all easy to use and let the best ones win.”

Panache
Panache has created the Panache Universal Media Acceptor (PUMA) that is a plug-in compatible with any Flash-based or Silverlight-based media players. For video publishers who have integrated the plug-in, they can receive ads from multiple third-party video ad networks, multiple third-party video ad servers and multiple rich media vendors through just dropping one piece of code. It cuts down on the complication and integration for publishers, which makes life easier for marketers braving video and in-video ads and rich media campaigns. Instead of many vendors connecting to many publishers, publishers (through one plug-in) can access many vendors, servers and networks.

These two are certainly not the only examples of making rich media simpler. But they’re of a qualitatively different nature than ad networks plus rich media vendor partnerships, which are important to establish but not as exciting.

Matt Rosenberg, group director, media and entertainment at Organic, cuts to the chase: “Why do we assume that just because it’s a new format, people care? No consumer in the world is looking to interact with the next ad format.”

Addante at Rubicon adds, “I think because people are so focused on integration and making these things work, they’re spending less time on the creative element. The content has to be compelling. People are missing that point. At the end of the day, consumers don’t care about the technology behind it — they care about the content.”

How about a marketing campaign that successfully embraces rich media, video and widget functionality? Now that would be interesting. Fortunately for media companies — especially of the theatrical and sports genres — their content is already well-suited to take advantage of those intersections. iMedia covered an exemplary Paramount Vantage campaign here.

Clearspring, a leading widget distribution platform, has rich media-enabled campaigns in progress with Sundance and TLC (Ford Sync and Bravo are launching shortly), but no word yet on how they’re performing.

And yet as long as we’re talking about CTRs in the order of a couple of percentage points, I still feel like we’re missing out on a major creative opportunity. Targeting is better than it’s ever been, we know more than we’ve ever known about who is seeing our ads, we can create any iteration of experiences, but is that the best we can do with 300×250 or 728×90 pixels?

The promise of rich media is that it enables more engaging, interactive experiences between consumers and advertising messages. It’s so compelling in fact that ideally rich media creative stands on its own as an ad unit and delivers the kind of experience you’d get on a microsite.

As the industry as a whole is figuring out what happens after the click (thanks to comScore for enlightening research on the fact that the click is the tip of the metrics iceberg), and as we try to figure out what engagement means and how we should measure it, the subject is especially relevant as it relates to rich media. Rich media enables so many kinds of cool experiences, but we need to standardize (or try to standardize) how we measure its efficacy. Rich media vendors, widget companies and other players are taking steps in that direction, but there’s a burden on agencies to get involved, too.

Rick Corteville, head of digital of the EMEA region for Universal McCann, explains, “Everyone defines engagement differently. Engagement is a series of metrics that boil up into what one would consider an effective brand interaction. Agencies are copping out of the responsibility of defining that and keeping it vague. No one is trying to standardize that and say, for example, that ‘engagement is these three metrics.’ That’s an opportunity on agency and vendor sides to put a stake in the ground and spark controversy. At least it’s something other than us just speaking in the amorphous.”

Matt Rosenberg at Organic agrees it’s a task that we need to tackle, but that it’s not an easy one. If it’s now relatively straightforward to measure “audio on/off” and “play again” interaction in a rich media unit, for example, what if you could rotate a car in 3D? How do you measure that, or standardize its measurement? Rosenberg concedes, “If you can measure it against a set of standards, it’s not new.”

Kudos to VideoEgg for pioneering a new video plus rich media format (AdFrames) and throwing CPMs out the door in favor of a CPE (cost per engagement) metric. While there is a long road ahead to determine how to define engagement, and perhaps telescope pricing (depending on how long a user interacted with the unit, whether they shared it, etc.), VideoEgg at least committed to making the metrics jump. Given their favor on Madison Avenue, it could accelerate other businesses to follow suit.

Two more interesting developments with rich media and video:

What if we pushed our conception of rich media a few steps further? If rich media technology makes otherwise static content more engaging, couldn’t rich media make otherwise linear video content more engaging? I don’t mean adding rich media overlays to video, I mean something altogether different and otherwise out there. Why limit rich media technology to ads, or even to ads-as-content? What is the possibility of rich media within the actual content itself?

Three interesting steps in that direction:

• EyeWonder can now stream live video through its units. That could have interesting implications for location-based advertising and for live events, for example, if you were streaming live content through an ad unit to drive digital tune-in.
• DoubleClick + Flash 9+ HD means you can now serve HD videos through DoubleClick’s rich media units (full screen optional). Epson gave it a roll with Butler, Shine, Stern and Partners. Load time for me was prohibitively slow, but you can check out the creative here.
• Adobe Pacifica. It’s a stealth operation that is doing something with Flash and VoIP. Banners + VoIP? Now that is interesting.

Could we be on the verge of a creative Renaissance?

Source: iMedia Connection

Comments and dissenting opinions welcome below.