Optimistic Revenue Forecasts for Mobile Web 2.0

Mobile Web 2.0 is an evolution, already started, that will create major changes in the online and mobile world. The Internet today is not just PC-based anymore. There are 3 billion mobile phone users in the world today, compared to less than a billion of PC users. The growth predictions for mobile Internet are better than for PC-Internet, and the estimated number of Mobile Internet sites in 2017 is 150 million. As some experts believe, there will soon be a new generation of users whose first interaction with Web will occur through their mobile devices. The research carried out by the Online Publishers Association showed that that majority of Mobile Web users are males about 25-34 years old with a medium level of income.

Mobile Web now is obviously becoming a mainstream market and opportunities for businesses are growing. According to Juniper Research, Mobile Web 2.0 applications, services and advertising will generate about $22.4 billion in revenues worldwide by 2013 as compared to the $5.5 billion of today. Juniper described Mobile Web 2.0 as the use of mobile devices for social networking, search, instant messaging and various applications and services.

The research states that social networking and user-generated content on their own would amount to $11.2 billion in 2013 from $1.8 billion in 2008. The report identifies the ‘prosumer’ – someone who both creates and consumes content and the ‘social web’ – a variety of social computing tools that enables users to develop online identities, create online communities and communicate to people sharing the same interests. As the Juniper analyst Ian Chard points out, ‘combining the power of the social network map… with that of mobility presents the greatest opportunity for revenue generation of any of the applications’.

Today North America, Western Europe and Far East are the main regions dominating this market, but the situation is about to change as more and more mobile phone users appear in the developing countries.

A lot of big brands, such as Pepsi, BMW, McDonalds, Google and others have embraced the opportunities offered by the Mobile Web. However, the challenges are present as well. Mainly, of course, the technological problems, but as well the problem of changing the business model for mobile operators, and, nothing new, the issues of privacy.

To my mind, the findings of the report could turn out to be far too optimistic. For example, three years ago Mobile Web already experienced a huge decline in browsing figures, and there is no guarantee it won’t happen again. Social networking sites are hugely popular today, but as the generation of their users is growing up they might be replaced by something entirely different. The number of PCs in the world is growing fast as well. What I can’t understand (probably someone can explain that to me) is why would anyone who is not able to get a PC spend substantial amounts on Mobile Web applications?

Image source: http://www.mobilecomputermag.co.uk/tag/mobile-services.html

A Good and a Bad Example of Employees Blogging

Let’s talk once again about corporate blogging – looking at good examples and understanding the mistakes. Kodak has been an example of successfully blogging company for the past few years. They have two simple but great blogs, targeting different groups of readers – first one, A Thousand Words, and a second one, used to be called A Thousand Nerds but now renamed into PluggedIn. A Thousand Words is, as written in a blog user guide a ‘place for stories for from the people of Kodak’. The stories written by employees are about photography, they provide readers with useful tips, engage them in contests. The blog is not focused on Kodak’s products. It is very honest and open, has particular audience and updated regularly.

The second blog is more product-focused, is ‘a place where Kodak employees share insights about the products we make’. As I suppose it targets more male readers, interested in technology behind photography.

The posts in both blogs are very natural. While a lot of brands center their blogs around their products, Kodak tries to present the content from the readers point of view. Authors of both blogs are very attentive to comments, and are able to create a conversation with the readers.

The example of Kodak is very positive. However, sometimes companies’ employees can do a lot of harm when posting on official blogs. Some time ago one of the Google employees and bloggers posted a story on Google’s Health Advertising Blog trying to rally health care advertisers against Michael Moore’s documentary ‘Sicko’ by advising them that they should increase their presence in the search results as well as criticized the movie as one-sided. As her statement caused a lot of negative reactions, she had to later clarify that what she wrote was only her own opinion, not Google’s. As Google representatives stated in Google official blog, ‘our internal review of the piece before publication failed to recognize that readers would – properly, but incorrectly – impute the criticisms as reflecting Google’s official position. We blew it.’

Therefore it is crucial that a business blog has a corporate voice, not a personal one, and all criticism should be well-thought to avoid reputational damage.

Image source: www.successful-blog.com/tag/living/

Social Network Ads: Not Much Targeting, Not Much Revenue?

Social networking sites could be, undoubtedly, very successful marketing tools. Unfortunately, the problem is that most of the companies do not yet realize that marketing online requires special marketing mix. They are using Internet as a part of broader marketing campaigns, without realizing the differences of the medium itself. Today we see targeted ads when we use search engines, but advertising on social networks, in which a lot of companies invest heavily, is mostly not targeted.

A research by Prospectiv shows that 56% of the respondents (on the whole 800 social network sites users were surveyed) think that their social networking experience would be better if marketers would use more targeted ads. 62% said they would be interested in offers from their preferred brands, and the majority of 82% said that right now they see very few or no ads relevant to their interests.

I find it very surprising that few companies using social networks realize the potential of targeting to increase their performance. On Facebook, for example, one wedding photography agency increased its business significantly by searching for the profiles of engaged women and placing its ads there. On MySpace two companies which reached consumers according to their preferences in clothes and music increased their performance by up to 300% while they were only on early stages of optimization.

Meanwhile, most of the companies are disappointed by their ad revenue from social networking sites. This week eMarketer reduced its forecast for U.S. and global online social network advertising spending, estimating that U.S. advertisers will spend $1.4 billion to place ads on social networking sites this year, instead of the previous projection of $1.6 billion, as social networks are still trying to come up with successful advertising models. Advertisers worldwide will spend $2 billion on these ads in 2008, and the spending will grow to $3.8 in 2011.

Social network advertising is still considered to be experimental by most brands. Even Google says that it’s not monetizing as expected. As Sergey Brin said recently, ‘I don’t think we have the killer best way to monetize social networks yet. We have had a lot of experiments (and some disappointments).’

Image: http://youblog.typepad.com/

Tweet for Customer Care!

Twitter has been a favourite topic of discussion among bloggers for the past few months. And as in my blog I am trying to describe various tools of e-marketing, this one definitely deserves attention. Obviously, Twitter can be of good use in market research and advertising. But apart from that, it can be used to respond to customer service issues. A lot of companies are on Twitter already, actively monitoring it. The methods of tweet tracking include, for example, TweetScan, TweetVolume, Terraminds Search, Quotably – and this is not the full list. If you are willing to improve your customer service, it’s quite simple to track problems your customers experience with your product and respond to them.

The most notable and discussed examples of companies already using Twitter are Dell and Comcast. Dell follows the Twitter conversations using Tweetscan and reacts when customers ask questions or complain about the Dell products or services. Both these companies had problems with their online reputation previously, and are trying to do everything to prevent it from happening again. Among other companies that have their representatives on Twitter are Firefox, Microsoft, Yahoo, Disney, SAP Labs, and a few airline companies. Most of them, as it is not very hard to notice, belong to the computer segment. Obviously, getting advice on Twitter will be of more help if you have a problem installing software, than if your microwave oven’s broken. Still, other companies could benefit from it as well. Such instant interaction gives customers a sense that companies are open and really care. So I think it is only a matter of time that more and more brands will be using it – if not for the customers’ sake, then for the sake of their reputation.

Twitter gives an opportunity to build an actual relationship with each particular complaining individual. It provides (great?) opportunities for building company’s reputation and enhancing the brand. And yet, the more companies use various kinds of social media, the less privacy customers have.

Image source: http://customersrock.files.wordpress.com/2007/05/happy-sad-faces.jpg

Pepsi & MyClick: Creative Mobile Challenge

With the Olympics coming soon, marketers become busy. Pepsi-Cola, once again, is using the most innovative technologies. In team with Chinese company MyClick, Pepsi launches the Creative Challenge. It encourages consumers to upload their photos with their basic personal data on any of the six major portals used in China - 163.com, xiaonei.com, taobao.com and 51.com, Poco.cn and iPartment. The target group is the so-called ‘Generation Wow’ – young people aged 12-24. Winners will become Pepsi Creative Challenge Stars and will appear on all Pepsi cans during the Olympics. Personally, I wouldn’t be very happy with my face appearing on a can, or say a cheeseburger wrap, but for many people, I guess, it’s a very exciting experience.

The campaign is supported by the various ways of advertising – TV, printed media, WAP, MMS. But the technological highlight is the use of MyClick technology based on image recognition, which allows to convert camera phones into opt-in mobile marketing devices. That’s how it works: users download the MyClick application to their phones via the MyClick website. When they see a MyClick enabled image, they activate their MyClick application and photograph the MyClick frame (Pepsi's frame is shown in the picture above). If the software detects that the phone is not equipped with a camera, it prompts the user for an alpha-numeric code instead.

This gives consumers one-click access to all of the Pepsi Creative Challenge contest details, and the ability to cast vote and check on their current blogs. Customers clicking on MyClick Hyperlink Frames are directed to the campaign site where they can interact with the brand. As MyClick site states, important consumer information may also be captured such as mobile phone numbers and email addresses.

On a more complex level of explanation, this technology works much like mobile barcodes, but instead of consumers snapping a picture of a 2D barcode, or QR code, they take a picture of any image bordered by a MyClick frame. MyClick's frame acts much as a 2D barcode, sending users to a specially created mobile web site for more information, or downloads. By the way, MyClick enabled image is printed on 2 billion Pepsi bottles.

To my mind, this campaign is likely to be quite successful in China, world's largest mobile market, with 500 million mobile phones in use. Youth will definitely be delighted by the campaign, as millions of people dream to become ‘stars’. The difficulty is that most of the time, users have to download a program to their phone to be able to facilitate the image recognition process, which makes it more complicated and takes more effort from consumers. On the whole, I think that this is a good addition to the traditional ways of promotion, and it will further evolve in the future.

Image sources: http://thats-china.com/, http://www.myclick.hk/.

Consumers, Social Media, and Customer Care

Today’s consumers gain more and more power, and marketers have to adapt. As the new technologies are evolving at a great speed, companies have to constantly look for new opportunities and change their marketing strategies accordingly. There was a time when having a successful website was enough, but not anymore.

Word-of-mouth has always been important, and its importance is growing now as social media gives the opportunity for happy and unhappy customers to speak up. They can convey their messages about long queues and high prices in the Nokia Care Center not only to their best friend, mum and a bunch of co-workers (the number of people depends on how long they had to queue) but to much larger audiences. Social media is free, convenient and enabling. It allows one to influence the others, and sometimes we don’t even realize how big this influence is. That is why so many brands are turning to relationship marketing now, trying to establish a dialogue with consumers.

A lot of people use social media not only for self-expression, but for research. The Society for New Communications Research is conducting a study “Exploring the Link Between Customer Care and Brand Reputation in the Age of Social Media”. The initial findings allow to state that a vast amount of consumers use social media to share customer care experiences and research companies’ customer service reputations.

More than 300 people participated in survey in February-March. The results show that 72% of respondents research companies’ customer care online prior to purchasing products and services at least sometimes, 74% choose companies/brands based on others’ customer care experiences shared online, 81% believe that blogs, online rating systems and discussion forums can give consumers a greater voice regarding customer care. When customers were asked which companies have used social media better than others, Dell and Amazon were the winners.

I see these findings as very important for the companies to look at. Brands can’t avoid listening to consumers. In order to have a better reputation, they need to provide better support to customers, communicate with them and understand their needs – both online and offline. Otherwise they risk not only losing a few customers in a short term, but possibly undermining consumers’ trust in their brand in a long term.

Internet Marketing for Luxury Brands: Good or Evil?

Today Internet is a medium used by the majority of the global brands as an indispensable marketing tool. Its multiple benefits make it look like a panacea for the marketers’ problems. Still, some of the well-known brands consider online marketing damaging to their image. Those are luxury brands. Luxury goods have a rarity value which makes them more desirable, while Internet is available to the masses seeking a bargain.

Luxury designers invest heavily in retail outlets which play the most significant role in the overall luxury buying experience. Physical surrounding and personal attention of luxury stores continue to remain important to the customers, while online shopping is seen as being to mass and not exclusive.

Few of luxury brands such as Prada, Bulgari, Burberry, Gucci, Louis Vuitton, Bang & Olufsen, Tiffany's, Chanel sell their goods directly online. Real luxury brands don't have successful websites. They look like shiny brochures, take a lot of loading time and lack functionality. I am not sure about the peacefulness of my dreams tonight after seeing the image on the index page of Prada website.

Yet, few companies, such as LVMH (Moët Hennessy - Louis Vuitton) realize the importance of their online presence. LVMH owns the E-Luxury site on which it sells most of its brands augmented with selected products from other high fashion brands. Still, instead of using any of its brand sites for the online selling, the group has set up an independent site, with an unconnected brand.

While most of the luxury brands keep ignoring the Internet, the demand for global luxury online sales is on the increase. Recent reports indicate that the wealthy are almost all online and are pleased with making online purchases. Therefore, even considering that online shopping is much less fun than traditional, there's no reason not to use the Internet to share information about the brand and create desire. Internet marketing for luxury brands could be an opportunity to reinforce the brand as it exists in offline world stores.

Image: Bulgari website

Online Behavioral Advertising: How Much Privacy Do We Need?

Imagine that one day you go to visit your friend who’s just bought a new coffee machine. The coffee it makes tastes really good, and on your way home you start thinking that it could be a good idea to get one for yourself as well. But being an outstanding individual you don’t want to buy the same one as your friend has. So the next day at work (during the lunch break, of course) you Google ‘coffee machine’ and get overwhelmed by the variety of choice. Struggling to make up your mind you go to the Yahoo’s page to read a horoscope/rugby news headlines, and there it is, in the right hand-corner, the perfect coffee machine for just 99.99$!

That is not a miracle. That is online behavioral advertising (OBA), the tracking of consumer’s activities online – including the searches the consumer has conducted, the web pages visited, and the content viewed – in order to deliver advertising targeted to his individual interests (definition of Federal Trade Commission). Behavioral advertising is opposed to contextual advertising, and proves to outperform it by upwards of 10 percent.

Yet, at least in the USA, 60 percent of consumers are uncomfortable with web sites using data about their online activity to customize advertisements or content based on their interests. Behavioral advertising allows very precise targeting, provides more relevant ads to consumers, but they also may pose data security and privacy threats.

This week Network Advertising Initiative (NAI), a cooperative group of online companies engaged in the practice of online behavioral advertising, released its proposed guidelines for its members to follow when engaging in behavioral targeting. The group members include Advertising.com (an AOL company), Atlas (a Microsoft company), BlueLithium (a Yahoo! Company), Doubleclick (a Google company), Mindset Media, Tacoda (an AOL company), Yahoo!. The document was passed in response to principles proposed by the Federal Trade Commission last year.

NAI states that all the limitations to OBA should be carefully considered, as ‘the great diversity of content and services on the web is predominantly powered by advertising’ and that OBA ‘does not result in more advertising, but creates more relevant advertising’.

The guidelines outlaw targeting ads to children under the age of 13, using information about certain medical conditions (HIV/AIDS status, psychiatric conditions, abortion-related), or certain personal life information (sexual behavior).

The association also published a list of other topics that are potentially sensitive, which has been widely debated (age, addictions, pregnancy, race identification, death and others). Each company will decide, whether it is appropriate to use this information or not. But as Saul Hansell points out, ‘what sort of technology is needed to display advertising to potential customers afflicted by “death” goes unexamined in the document’.

It is understandably hard to define which data should be restricted. I value the benefits of OBA, but as a consumer I still want my life to be private. To my mind, these guidelines and rules of FTC are definitely good initiatives. But the further concern – is it enough to have just a voluntary self-regulatory code of conduct?

Image source: http://www.pigseye.com/hj/foreign/italy/masks.jpg

What the World Needs Is Zero?

As it was stated in Computer-Human Interaction Conference in Vienna back in 2004, ‘blogging is the latest form of online communication to gain widespread popularity and it is rapidly becoming mainstream’. Well, there are no doubts that today it IS mainstream already. Blogs in their current format emerged around 1997, and today, according to Technorati’s State of the Blogosphere report, we have an almost unlimited choice of blogs for our Readers, which amounts to more than 70 million, with 120.000 new weblogs created and 1.5 million posts written each day. So there’s little surprise that companies find blogging to be a very useful tool in their marketing campaigns. They use blogs as a new communication channel, providing an opportunity to inform their customers about their products and services worldwide and to receive feedback.

I am going to write more about how particular brands use this web phenomenon in the next posts. Today I just want to focus on one example, a controversial one, offering something to learn for the marketers. Enough about Pepsi, let’s talk about Coke for a change. Yes, Coke. Zero Coke. In 2005 as a part of a massive campaign in Australia Coca-Cola launched The Zero Movement blog. Oh, it’s awesome. Just have a look at it. The writer is apparently a young man in his 20s, depressed by working in a ‘cubicle’ under unbearable pressure. One day he wakes up (well, I think it happened just after he woke up, or, more likely, he was still dreaming – as such ideas come up only in the wildest dreams) and decides that ‘what the world needs is ZERO’. For real. I’m serious. ZERO = POWER. ‘Why do I have to act my age?’, ‘Why can’t a lunch hour go all day?’, ‘Why can’t guys…?’, and, of course, ‘Why can’t you have real taste and zero sugar?’. The comments to these posts are even smarter and look so real: ‘Coke Zero tastes really nice’ , ‘thank you Coke Zero... you made my life worth living!!’. You don’t have to wonder why this blog was widely criticized in press. The desire to connect to the target audience was apparently too strong here.

This blog got a lot of publicity, even more with the creation of The Zero Movement Sucks blog, criticizing Coke’s online spamming. But, of course, the campaign was planned with the intention to be controversial. The TV commercial they initially used in Australia was banned. Coke had to comment on ethics of its activities. Still, this campaign resulted in Zero Coke being the most successful new product launch in Australia retail history. Was Coca-Cola sure about its success? I think it might have failed just the same. But apparently well-calculated risks are worth taking if you want a success in marketing.

Image source: http://icanhascheezburger.files.wordpress.com/2007/02/do_not_want_coke_zero-chris.jpg

Pepsi's Social Media Marketing: Wanna Play?

Some of you have probably already heard that PepsiCo International, a company with revenues more than $39 billion, is going to launch a social networking site focused on football later in April starting from Europe. The Beta-version of Pepsi Youniverse is already available for football fans, allowing to create your Visual DNA and compare it to those of big football stars like Lampard, Henry, Messi, Ronaldinho, and, of course, Beckham. The Visual DNA is an Imagini Holdings Ltd invention – it is a personality test, you have to answer the questions by choosing the appropriate images to get your psychographic description. Pepsi Youniverse’ Visual DNA describes what type of a football fan you are, using questions like ‘The best thing about being a footballer is…’. My closest match, according to this test, is Lampard, and football is definitely a huge part of my life (they don’t ask you whether you’re interested in it or not, it is assumed that you are). After launching this site Pepsi plans to create even more networks, focused on music and ‘hopes and dreams’.

There already exists another Beta-version (I am surprised how it’s got through the alpha test, though) which I personally find more interesting, but of which almost no one heard about (at least Google search makes me think so). It is another Pepsi social network targeting specifically the Pepsi Max drinkers. I liked it a lot not only because I had to choose what type of man I am (Visual DNA again), select the contents of my car and then select my gender (female, what a surprise), but because it lets you merge your email (whether you use Gmail, Yahoo or Hotmail), other networks (Facebook, Flickr), RSS subscriptions, and that’s not the whole list. It also includes space for blogging, digital storage, videos, and standard social networking site options. And as we are using more and more different sites, with even more appearing almost every day, merging it not a bad idea at all.

But let’s get back to Pepsi: all these networks could definitely become very powerful research and marketing tools. If people do really need them. How many teenage football fans and for how long would be amused by comparing their personal profiles to Ronaldinho’s? Are these investments going to pay off?

Vista Service Pack 1

First off, to those unlucky individuals who happen to use one of the most wonderful products of the latest times - Windows Vista: Vista Service Pack 1 is ready and available for download (at least, Microsoft states so) through Windows update or Microsoft site. Unfortunately, due to some drivers incompatibility not all of us will be able to enjoy it.