12 Trends for the Next 3 Years for Internet Marketing
I've been publishing Web Digest For Marketers since April 14th, 1995. It was the very first email newsletter about Internet marketing.
My staff and I have seen tectonic changes that will only accelerate. On the other hand, we've witnessed many "next big things" fizzle and die, never to be heard from again.
The 12 trends below represent what I think you need to keep an eye on in the foreseeable future. Enjoy.
1. Mobile eCommerce Picks Up Speed
There are currently over 240 million cellular phone users in the US. Nielsen reported that 58 million people viewed an ad on their mobile phones in February 2008. Mobile couponing is one tangible way to execute this new channel of commerce.
At the time of this writing, the Subway mobile campaign (to get coupons on your cell phone that you can redeem for sandwiches at the point of purchase) seems to have the best numbers out there. It works because it's simple. Participants have two ways to opt in:
At the time of this writing, the campaign is live in Buffalo and Seattle. Response rates range between 6 to 8%, which is much better than the print coupon average of 2%.
Modiv Media handles this Subway mobile coupon campaign. SVP Michelle Deziel oversees this effort, which is still rolling out into other markets.
She told me that at the beginning of the campaign the response rates were as high as 50%. She added that 82% of those participants surveyed said the coupons changed their minds about where to eat lunch that day. Originally, the coupons expired in 24 hours. Subway then expanded that to 48 hours to allow for more redemptions, yet still give urgency to the offers.
At first, only 3 coupons a month were sent. Most surveyed said they actually wanted more than that. This proves that if the offer is of high value, people will want it, even on a mobile platform where it costs them money to receive such offers. The Subway coupon promotion works well because its execution is very simple, using text messaging.
Beyond Mobile Coupons: QR codes are being used heavily in advanced mobile markets like Japan. A QR code is two-dimensional symbology that contains much more data than the unidirectional US bar codes. QR codes are both vertical and horizontal, as opposed to US bar codes, which only hold data on a single plane.
In Japan, a mobile phone user on a train platform can take a picture of a transit display ad featuring a QR code with his/her cell phone, and the software embedded in that cell phone will interpret the QR code and then display additional information such as movies and their showtimes. QR codes are displayed on buses, in magazines and on business cards. For more info on QR codes go to QRCode.com.
25% of Japanese mobile data users today respond to mobile campaigns and sign up for promotions or make purchases as a result of viewing an ad.
Look for more of this type of mobile couponing in the short term. In the longer term, look for QR code or similar promotions to take hold as telecom standards in other countries are agreed upon and executed thereafter. In the US, there are still too many mobile telecom platforms to make this feasible.
2. Web Serves as Test Bed for TV
The Web is a real-time marketplace giving gigabytes of feedback every second. It's much cheaper to test a programming concept online, or to have the online marketplace identify one on its own, than to see what works and fails using TV pilots.
At the time of this writing, NBC Universal was launching an iVillage channel (NBC purchased iVillage for $600 million). The gossip site TMZ.com launched on AOL in December 2005. It recently attracted over 11 million unique visitors according to comScore.
TMZ, the TV show, debuted in September 2007 and was the top-rated freshman-syndicated show for that period.
Quarterlife was a TV concept initially rejected by ABC. The creators produced it anyway and offered it in a shortened Webisode format at MySpaceTV.com, YouTube and quarterlife.com. It was popular enough to interest NBC in airing it on its broadcast network (this is the first time such a thing has happened). While it didn't stay on the broadcast network for more than that first episode, NBC elected to place it on Bravo.
Going in the reverse direction, at the time of this writing, NBC was making abbreviated Webisodes of "The Office," "Heroes" and "Chuck" available on the Internet.
3. Pay-Per-Click (PPC) Video Ads
This is already starting to happen. Sometimes, when one does a search on Yahoo or Google for a laptop or "Smartphone," you get search results with a sponsored or partner link to a video that showcases the product.
Again, at the time of this writing, in the northeastern US when one does a search for "shop Honda" you will often get a graphical "Partnership" listing saying "Play Now." It will play you a 360-degree shot of a Honda with arrows pointing out various attributes. It's mainly a branding message, not a call to action.
If you search on Yahoo for "Special K" (at the time of this writing), you get a neat 23-second made-for-Web spot inviting you to visit SpecialK.com, where you can sign up for their "Get Swim Suit Ready" email or text message service. It said I could lose 6 pounds in 2 weeks. (Maybe I should sign up :).
The implications of PPC video are huge. It will up the ante on highly competitive search terms. I think people will more likely click on the PPC ad with a video image over the plain text ad with just a blue link to click on.
4. Transparency Marketing
This term has a double meaning with implications for both marketer and consumer alike.
A. The Consumer: It's privacy versus convenience. Some online consumers are more comfortable sharing information than others. I've seen stats saying younger folks are more comfortable generally than older people with sharing information online. I think this is true.
If there is a gross breach of security which compromises a great many people, the attitude towards sharing information may get more conservative. Or people may become inured to such news and take their chances.
B. The Advertiser: The average consumer nowadays is way too sophisticated to put up with old-time hot-air advertising. Smarter brand advertisers are talking in a more real tone and even (heaven forbid) interacting or supporting a forum for interaction between people in a created affinity group.
In my Web Digest For Marketers newsletter, we've covered Dove's Campaign For Real Beauty. More than 4 million people (at the time of this writing) have joined the campaign's conversation, via the forums found there.
Weight Watchers is running an ad saying "Take a diet from your diet." On their website, the headline is "Stop Dieting. Start Living." This approach is now all about "healthy living."
Tylenol is promoting ways to avoid migraines and aches. That's certainly better than the old Anacin commercials, where the announcer laid a guilt trip on the guy who just yelled at his wife because he had a headache. :) Tylenol's current message is "Feel better. Feeling better is not just about the pills we take. It's also about the choices we make every day".
History repeats itself. Candor in ads isn't new. The legendary Doyle Dane Bernbach (now DDB Communications) featured understated claims with its VW ad saying "Think Small." This was in the 1950's when everything else was heralding bigger is better and newer is best... and now, back to the future.
On another level, due to the openness of the Net, many direct marketers have a tougher time doing split-price tests online as opposed to offline. With social forums and email forwarding, a direct marketer has to be careful. I've also seen this conundrum in Europe, where one manufacturer may charge different prices in different countries for what is essentially the same thing.
5. Universal or Blended Search Results = Game Changer
Universal or blended search results blend videos, audio files, news, pictures, blogs and more into the SERPs (Search Engine Results Pages). This has profound implications for all sites and SEO (Search Engine Optimization) practitioners. Some implications are predictable, and many are not.
Google started this trend and the other majors say they're going to follow suit. Do a search for "Steve Jobs" on Google and (at the time of this writing) you will see a freeze frame of a video of the Apple CEO's commencement speech at Stanford. You can click on that video without leaving the SERP. This makes the SERP more of a destination page rather than a middle step between your search query and a site housing content.
Furthermore, you can now often search a site listed in the SERP right then and there, without going to the site itself. Here are some of the implications I see forthcoming:
The days of simple keyword optimization are gone. The bar has been raised and the barrier of entry for coming up higher in SERPs has been raised substantially, and, in my estimation, will keep being raised as we move forward in time.
Furthermore, in research I've seen recently, users who get blended search results go beyond page 1 far less than those getting traditional search results.
ComScore's Eli Goodman recently told me that their research shows people want more media choices. It seems to me that Universal Search is giving users what they want. It may be at the short-term expense of PPC clickthroughs, but longer term, it's probably right-headed, even if payback isn't crystal clear right now.
In my original "Top 10 Trends for Internet Marketing" written in 2005, I predicted there would be software agents available to glean from the Web the information that you want. It may be that the search engines with Universal Search and behavioral tracking are those agents realized. Your search behavior is stored and used to help deliver search results that distinguish apples from Apple computers.
Much thanks to SEO expert Mike Grehan for pointing out the implications of Universal Search to me very early on in the game.
6. Social Networking Goes Mobile
Research firm Gartner expects sales of interactive video games to rise to $9.6 billion by the end of 2011. Some share of that revenue will be in the mobile interactive gaming arena.
Nokia's N-Gage platform allows users of its phones to play video games with each other in real time. At the time of this writing, the cost of the full-featured game app was $16 ($8 for a 7-day pass, or $4 for 24 hours).
While interactive games currently work on a subscription model, look for gaming portals to offer sponsored interactive mobile games at no cost. Will sponsored games simply have product placements, or make the brand central to the game itself? Will there be a direct response ROI expected or just brand awareness metrics applied? Stay tuned.
Look for social networking sites to add mobile components. Some are starting to do so already.
Buddy-Mapping: Loopt now gives you the ability to track your buddies, family members, etc. on a map, using GPS-enabled cell phones. At the time of this writing, Loopt has 100K users, all of whom must give approval to all in their friend network. Loopt is not currently offered on all cellular services, but could be. It is a subscription model that has first offered the service gratis to induce trial and then plans to charge $3 - $4 monthly.
7. Voice and Large Print Interface
The easiest interface is voice, because we all know how to talk. :) But it is far from easy to make machines understand what we're saying. There have been many endeavours in this arena.
Tellme Networks (bought by Microsoft for over $650 million) can identify your speech patterns to determine which stock quote you want or which locale you want for weather. Google has 800Goog411, and Jingle powers 800free411.
But surfing the Internet by voice is a major frontier. The hope is you'll pay in order to save yourself lots of thumb typing on your cell phone or regular typing on your desktop or laptop by using your voice to access the Web. Using Vlingo, Yahoo is now underway to enable you to ask for "Cuban cuisine in Miami" and then show you search results pages accordingly.
Large Print Is the Next Big Thing: With baby boomers getting older and their sight not as good, it will become a no-brainer for site designers to increase the font size on Web pages. Ask direct response practitioners who regularly test everything, and they're quite apt to tell you they get better response rates when they increase the font size.
Amazon's Kindle is a handheld device that lets you download books, magazines and newspapers while you're on the go. Kindle offers the ability to increase the font size by six increments.
8. Video Phone Calls Over the Internet
The 1964 New York World's Fair featured a video phone in the AT&T pavilion. It was a very large elliptical-shaped box and a very small black and white picture. Since then, many have tried to make video telephony a mass-merchandised product. I think its time is just around the corner.
There are 3 reasons for this:
Digital video gear is getting pretty cheap. Couple that with cheap bandwidth and media-savvy younger demographics that are into social networking sites and you've got the makings of two-way video phone calls. It will irrevocably change social networking sites as well as the online dating scene.
9. Internet Media Pricing Affects Offline Media Pricing
The most obvious example of this is Craig Newmark's Craigslist.com, which has wiped out untold millions from print newspapers. Classified ads are the bread and butter of many newspapers. Craigslist only charges for job listings in 11 cities and apartment listings in New York City.
As more local businesses learn they can employ pay-per-click advertising rather than paying in advance for a Yellow Pages or print ad that may or may not be working, they will naturally choose the more cost-effective and trackable option.
This is especially true in B2B. Many of the advertisers in my Web Digest For Marketers email newsletter no longer use print advertising. They say they are more expensive and less trackable.
10. Offline Media Usage Shrinks
Many organizations show research that suggests TV viewing is not shrinking. Let's review:
CTAM (Cable & Telecommunications Association for Marketing) says broadband video currently makes up less than 3% of total video watching per week. I'm thinking that 3% figure is more likely to go up and not down.
The average respondent in a CTAM survey watched 31.4 hours of TV per week, and 0.9 hours of Web video. My bet is this .9 number will increase dramatically.
Broadband video users do watch slightly less total TV (8% less than the total population).
According to a Nielsen survey, widespread Internet video viewing won't really take off until Internet video streaming can be viewed on large screen TVs typically found in the living room.
eMarketer's Senior Analyst Ben Macklin says most of the evidence available suggests that online video content is supplementing and complementing traditional TV content and viewing habits, rather than replacing or supplanting them. As BurstMedia has noted, viewers often watch TV and use the Internet at the same time, so the two media are not necessarily in competition.
Here's what I think is going to happen: In addition to short, funny clips on YouTube, we're starting to see TV programs migrate to the Internet (with limited commercial interruptions). Take a look at Hulu.com, which is a joint venture between NBC Universal and Fox Networks.
Is Hulu.com the right model for TV shows online? Time will tell. The point is that TV programs in one way, shape or form will be widely and deeply available on the Internet in the foreseeable future.
When TV content becomes widely available on the Internet, it will become redundant, much the way a land line is to having a cell phone. When a household wants to cut back on its telecom bills, they get rid of the land line in favor of the cell phone. Down the road, when a household again wants to cut back on more telecom bills, they'll be able to get rid of cable or satellite TV service because much of their video needs will be available on the Internet.
11. Sponsored Software
Look for the buzzword "cloud computing" to be used a lot in the near future. What is it? Briefly, the software applications and most or all of your documents are stored not on your local computer but rather on a remote server somewhere out there on the Internet. Within the realm of cloud computing is an emerging business model that allows you to create spreadsheets, presentations, text documents, etc. without paying a subscription fee for the software.
How does it pay for itself? Well, it's paid for by ads, the way ads pay for a Gmail, Hotmail or Yahoo Mail account, for example.
These are the early days, and at the time of this writing a lot of the details have yet to be filled in, but keep an eye on it and others like it. Sponsored software could challenge the subscription software model that firms like Microsoft currently enjoy.
Google is inching toward making Google Docs, its free, Web-based, Office-aspiring programs, work offline as well as on. As long as you have an Internet connection, all changes are saved to the cloud. When you lose the connection you should be able to view and edit your documents and save them locally. When you're back online, the documents sync up again with the server.
How comfortable people will be having their information physically remote from where they are is an obvious question. There are two issues here:
But in a world of transparent marketing (see Trend #4), it may matter less to some than to others. However, Google Docs recently announced an offline module that lets users take documents offline. This is one way that people might become more comfortable with this concept.
12. The Content Marketing Age
In an age where the customer rules, the advertiser must come bearing gifts. Since the advertiser is employing information channels to reach the user, that gift is most likely going to take the form of information.
There are two different types of information:
Commercial content might be coupons, catalogs, or anything that moves closer to a sale.
Editorial content will be given out of the desire to build credibility and good will with the target audience.
It's not just the message. For more on the age of content marketing, go here:
New Rules for 21st Century Marketers
Web 2.0 is a participatory experience for the user. In the last century, marketers expected users to sit there passively and consume their marketing messages. If you do that today, you'll not only look very dated, but your campaign results are apt to disappoint.
21st century marketers must engage the audience. You may engage them in a conversation. You may offer them an engaging video or game or podcast or contest. You may also serve as a conduit for your target audience to engage each other, as is the case with the Dove campaign mentioned in trend #4.
Yesterday's creativity was about crafting words and pictures. Today's creative marketing minds look for new and interesting ways to use the medium itself in order to engage their respective target audiences.
Many thanks to Research Director Gayle Kerley for her exhaustive efforts in bringing many of the facts and numbers in this document together.