NextMark

Wired, Adobe, Apple iPad & the future of publishing

Wired Magazine and Adobe teamed up to create a digital version of their magazine. The results are quite impressive. Here's a video that explains their vision and shows off the iPad version:

The user is experience is great. The ability to navigate, zoom, manipulate, and see videos is very useful.

All this technology is way cool, but it's still missing a key ingredient - Relevance!  Everyone sees the same stories and same ads. Sorry, I'm not in the market for a Ferrari.

Someone let me know when the content can be personalized and relevant to the reader.  In other words, when will magazines finally make the jump from broadcast media to addressable media. That's when things get really interesting.

SMS Text marketing - hot or not?

A recent TechCrunch interview with 4INFO, the "King of SMS," portrays great promise with the SMS text medium and with the company. However, reader comments below the article indicate otherwise.

Here's the interview:

Industry analysts seem to agree with 4INFO: According to J.P. Morgan's 2010 Internet Industry Outlook, mobile advertising is expected to grow by 45% in 2010 to $3.8 billion fueled primarily by mobile message advertising (SMS Text).

Your take? Is SMS Text marketing hot or not?

Online is just as messed up as offline marketing

I've been doing some research into the online display advertising channel as a natural extension to NextMark's media planning tools. You might assume that everything is streamlined and super-automated in this world. But I am finding that it is messy and crude, perhaps even more so than the offline world (if you can believe that).

A video from Yahoo! previewing AMP! (since rebranded as APT) does a good job of explaining some of the messy problems with today's solutions:

"Turns out that buying and selling ads online is byzantine with inefficient processes and cumbsome legacy systems. Nothing works well or together. [..] The current system is - to put it politely - slow. It may also be inaccurate. And you know going in that you will have to overbook to cover your promise. [...] You have to cobble them all together. It took ten separate contracts and two weeks. [...] A disconnected process full of time-consuming manual steps and multiple approval bottlenecks to catch the mistakes inherent with the process."

Is it just me, or does this seem a lot like list rental?

It's also crude.

Anyone who has used mailing lists knows the deep level of data and behavioral targeting that enables you to achieve relevance with your marketing. In looking at online display, I am amazed at how weak what is considered "advanced targeting" in online. Looking for coffee drinkers, chocolate lovers, or java developers, or CIOs? That's easy with postal, but very difficult (impossible?) in online display.  Especially if you want to do it at any scale.

There are many problems with poor targeting, including:

1. Ad fatigue - contantly showing irrelevant ads trains the viewer to ignore
2. Poor advertiser ROI - when people are seeing irrelevant ads or are blind to them, they don't respond
3. Lost publisher revenue - if the ads don't work, advertisers will not be willing to pay very much for the impressions

Nobody wins when there's no relevance.

Where there's a problem there's an opportunity. Online display is getting a lot of attention and dollars. I expect we will see some great things in the next few years.

comScore Releases The 2009 U.S. Digital Year in Review

New from comScore: comScore presents the 2009 U.S. Digital Year in Review, its annual report on the prevailing digital trends of the past year and their implications for the future.

According to comScore, "2009 proved to be a critical year in digital marketing as the economic environment brought unprecedented challenges to the industry. After years of strong growth across the digital economy, the recession introduced softness to many digital business sectors. But despite these economic headwinds, consumers’ use of digital media climbed to new heights in 2009 as the Internet continued to evolve as an integral component of Americans’ personal and professional lives."

According to their press release, The report provides a comprehensive view across the fixed and mobile digital sectors to uncover this past year’s important consumer trends. Key findings highlighted in the report include:

• The U.S. core search market grew 16 percent in 2009, driven by a 6-percent gain in unique searchers and a 10-percent gain in search queries per searcher. Google and Bing led among the core search engines in terms of increases in market share.
• Social networking continued to gain momentum in 2009 with nearly 4 out of 5 Internet users visiting a social networking site on a monthly basis and Facebook and Twitter propelling much of the growth in the category.
• Display ad impressions grew 21 percent in 2009 as the online advertising sector increased its share of media spending. Growth was driven by an 8-percent increase in ad reach and a 12-percent increase in average frequency.
• Total (retail and travel) U.S. e-commerce spending reached $209.6 billion in 2009, down 2 percent versus the previous year and the first year on record with negative growth rates. Nonetheless, e-commerce retail spending continued to increase its share of consumer spending in a challenging economic environment.
• Six out of seven U.S. Internet users now view online video content in a month, with YouTube and Hulu continuing to experience rapid increase in viewership.
• In the past year, the mobile industry witnessed smartphone ownership increase from 11 percent to 17 percent of mobile users, while 3G phone ownership increased from 32 percent to 43 percent.

comScore cites significate innovation in display adverising:

"The digital display advertising market is innovating on several fronts right now, including the emergence of new ad units that promote higher engagement, cutting edge ad targeting techniques, the development of niche audience ad networks, and the increasing popularity of online ad exchanges to buy and sell inventory. Each of these developments is contributing to the improved allocation and effectiveness of digital ad campaigns. Marketers must maintain a critical eye on the performance of their campaigns, in relation to how both digital media and traditional media components are performing."

The full report is available here www.comscore.com/digital09 

End the debate. Snail mail is here to stay.

Marketers are now realizing that abandoning direct mail for digital media may have negative consequences for return on investment (ROI), and the impact may be worse than expected. When budgets are tight, it's harder to see the forest from the trees, and it's easier to make cuts with less regard for lifetime value (LTV). Fortunately, information spreads fast nowadays so we get to hear pretty quickly what others have learned from their mistakes. Conversely, there are a few mailers that kept quiet about their success with direct mail in 2009 due to the positive implications of fewer competitors' offers in the box.

Yesterday's Wall Street Journal article, Firms Hold Fast to Snail Mail Marketing provides empirical evidence for why cutting back on direct mail could be detrimental for your business. It's a great article, and it provides practical insights for all marketers. It's encouraging to see some real world examples being published that confirm what so many traditional direct marketing services providers have been saying all along - that direct mail is an essential component of an effective multi-channel marketing strategy.

There are countless ways to mail smarter, but in the end it's about acquiring new customers at an acceptable cost -- I learned that from Donn Rappaport. You can go out of business trying to just save money, and your competitors will eat your lunch.

So far the expectations are for direct mail spending in 2010 to be consistent with last year. That's not so bad when you compare that with its 16.7% decline in 2009. Total spending on direct mail is still projected to exceed $43 billion in 2010, making it the second largest slice of the pie for total advertising expenditures (behind television advertising). Let's keep working together to make the process more efficient. Remember, it's not just cost that matters -- marketing services providers need to simplify the process and make direct mail marketing easier to do. Suppliers -- let's streamline the process together and grab the rebound from attrition.

Mobile advertising expected to grow 45% in 2010

According to J.P. Morgan's 2010 Internet Industry Outlook, mobile advertising is expected to grow by 45% in 2010 to $3.8 billion fueled primarily by mobile message advertising (SMS Text):

Although still a small piece of $159.2 billion that is expected to be spent on direct marketing in 2010, mobile advertising is a fast growing segment. Other gainers include display ads rebounding to +10.5% and search +13.7%.

(sources: TechCrunch, MediaPost)

Digital vs. direct mail in 2010

DM News article "Digital Shines in 2010" predicts the continued rise of digital spending as a share of total marketing dollars. Two interesting takeaways from a direct mail perspective:

#1) Digital is stealing share away from direct mail

"Just like in the old days, direct marketing used to be the safe haven because it provides quick, measurable results. Online has assumed that safe haven role now," said Adam Smith, futures director at GroupM.

#2) Digital is more measurable than direct mail

"If we send a direct mailer, it's an absolute impression, but is it as trackable? Will the consumer, for example, type Overstock.com/directmailer? It's fuzzy. Some people do and others don't," [Stormy Simon, SVP of marketing and customer care for Overstock.com] explained. "But I do know that when I spend on online marketing, I'm able to say 'I spent a penny and I got a penny [back].'"

The hallmark of direct mail has always been accountability. Digital is beating it at it's own game. The challenge to direct mail is to prove ROI superiority if it is to hold onto a significant portion of advertising expenditures.

See full article here: http://www.dmnews.com/digital-shines-in-2010-forecasts/article/159509/

How to save the Post Office?

The US Postal Service lost $3.8 billion last year. While still one of the most effective marketing channels, postal mail is in danger of extinction. Can the post office be saved? Postal Journal is a new website that aims to find a solution.

Postal Journal's mission is:

To explore the evolution of the American postal system as part of the nation's 21st century economic and communication infrastructure. To facilitate an exchange of postal perspectives by individuals without regard to past or present occupational affiliations.

The website is not high on design, but it contains links to a number of interesting proposals, such as the "Examination of Potential Postal Business Models" by Alan Robinson. He studies various models and proposes consideration of a private corporate model as other services have done successfully:

Is Robinson's the right business model? That's a good debate. And it's good that the Postal Journal website is presenting this idea and many others for consideration. Unfortunately, the website is not interactive... it would be very helpful to see discussion and debate related to the various proposals.

The Postal Journal site has been made possible through the support of the Association for Postal Commerce, Direct Communications Group, the Direct Marketing Association, the Envelope Manufacturers Association Foundation, and the Mailing and Fulfillment Service Association - all of whom have a vested interest in a viable postal service.

Google bets on mobile with $750 mm AdMob acquisition

Google's $750 mm acquisition of AdMob is their 3rd biggest behind Doubleclick and YouTube. AdMob, the mobile ad platform that has been especially popular on the iPhone, has certainly done a lot of things right in its first 3 years of operation with revenue approaching $100 million. Google thinks this can be a lot bigger:

"Despite the tremendous growth in mobile usage and the substantial investment by many businesses in the space, the mobile web is still in its early stages. We believe that great mobile advertising products can encourage even more growth in the mobile ecosystem. That's what has us excited about this deal."

The trend is clear. This deal shouts the importance of the mobile advertising channel. What can we learn from this? What should we do to capitalize on this trend?

NPR cites NextMark as the Google of Mailing Lists

Last night, NextMark was featured in part 1 of a story on data privacy by Martin Kaste on National Public Radio's All Things Considered program. NextMark's mailing list search tool was cited as the "Google for mailing lists" which is exactly what it is. It makes it easy to search virtually every mailing list available, with more than 60,000 mailing lists from 1,400 sources in the index.

Unfortunately, they used a search on "bladder" as their example. While I am sure there are certain pharmaceutical applications for this and the people with these problems would like to learn about solutions, it is an unusual example. I wish they picked a better example, but I can understand that it makes for a more interesting story (most mainstream examples would probably be considered boring by radio standards).

Mr. Kaste did a nice job in presenting a balanced story. He pointed out that:

"Reputable firms aren't just selling this information to anyone [...] you can look at the [NextMark] Web site and see that it's for sale, but they still want to know more about you before they sell it to you."

Actually, in NextMark's world, the technical term is "rent" not "sell" because the buyer does not take possession of the personal data and it can only be used once through a trusted third party service bureau that keeps the name and address data anonymous. Mr. Kaste also presented the positive effects of sharing information through a quote by an expert on best practices in marketing ;-):

"I think when it's done right, just as with a good friend, sharing personal information makes for a much relevant, meaningful relationship and without that, you're really just a number."

This is the crux of the issue.

The story continues with an interesting study by Italian economist Alessandro Acquisti that shows that people are more willing to share highly personal information on "cheesy" websites than on professional sites with well-stated privacy policies. Seems backwards, doesn't it?

Part 1 concludes with an interview with Chris Hoofnagle of the UC Berkeley School of Law who says, "if consumers knew the extent to which this information was being collected and repackaged, there would be riots in the streets." Hoofnagle is correct that there are cases where we should be concerned about the methods of gathering and trading of personal information. It's also important to note that if people knew about the controls that NextMark's clients employ to ensure privacy, then they would feel much better about sharing information and the relevance it brings to their mailbox (the opposite of "junk mail" and "spam"). Just like in any industry, there are good guys and bad guys. NextMark enables the good guys.

It will be interesting to hear if these controls are discussed in one of NPR's remaining episodes. If they are not, then I will follow up with another blog post on the topic.

In the meantime, you can listen to part 1 of Online Data Presents a Privacy Minefield on NPR's website or here:

Please add your reactions and comments below.