AOL joins the Internet party
June 30th, 2009 § Leave a Comment
Honestly, how should we react to the report by Michael Learmonth in Ad Age about AOL’s new publishing strategy on the web (“AOL Cracks Web Publishing – Sans Time Warner”). Should we laugh or cry, or stand to applaud?
It seems that un-encumbered by the weighty media assets of Time Warner, AOL has discovered the joys of smallness online, and the ability to publish freely according to the range of human interests and emotions. Quoting from the article:
The model goes something like this: Find a vertical with an audience attractive to advertisers, brand it (Daily Finance, Asylum, Lemondrop, Politics Daily), hire five to seven people to run it and plug in AOL’s traffic fire hose. Repeat.
Sounds easy enough. But, of course, keep in mind that:
They’re the antithesis of the kind of quality standards Time Inc. and Condé Nast tout, relying largely on aggregation, blogging and traffic-goosing tricks such as provocative slide shows. But unlike the print publications trying to port their cost structure to the web, these publications can be cash-positive from the start. In fact, one could argue these sites cropping up represent today’s version of the magazine launch — after the old, splashy kind died with Portfolio
Yes, indeed, one could argue that these sort of web sites represent today’s version of the magazine launch. We might call it, in fact, new media. We might even call it the Internet.
(Hello?!)
Whatever, as the Ad Age article reports,
The notion of thin-staffed online publications is sweeping the industry.
Sweeping the industry? Are you kidding? It is the industry! Millions of web publishers out there, some of them online for years, producing exceptional content and making tidy livings (actually, wait, I think there was just something about that in this space last week) creating the mosaic that we call the Internet - or the World Wide Web, if you prefer. AOL President, Global Sales, Jeff Levick calls it a “Massive change” to AOL’s business model. Sure it is. And welcome to the Internet party, Jeff.
Do I sound cynical? I’m not. (Maybe a little.) Nothing could be better for the industry than having AOL – and any other leading, influential players - adopt behaviors that validate the business model that has been and is the foundation of new media: quality vertical content, produced with small batch sensibilities, by and for people who care.
Obviously, AOL is proposing to output vertical content in factory-like fashion, which is how Companies like ours will compete with them. Their version of online publishing will be a bit like Time-Life Books, which is (so) funny thinking about in the context of their desire to shed the entanglements of branded Time Warner content. But after so much Big Media building, AOL’s foray into small media is welcome – and an important sign of an industry finding itself.
Re-modeling: Steve Ballmer speaks at the Cannes Advertising Festival
June 25th, 2009 § Leave a Comment
MediaPost’s (very helpful) “Around the Net” wrap-up of the day’s news stories caught the report in The Guardian newspaper of Steve Ballmer’s speech at the Cannes Lions International Advertising Festival.
If there is much coverage of the speech over the next few days I imagine it is going to focus on Ballmer’s assertion that advertising revenues will not rebound. They have been reset at lower levels, he says. It’s not entirely clear from the story, but I think Ballmer is really suggesting that ad revenues are reallocating to digital, meaning that overall ad spending may rebound, but not for TV and print. He recommends that traditional media companies re-work their business models taking into account the smaller slice of the ad pie they will enjoy. Fine. We’ve said as much here talking about the need for newspapers, especially – but all media - to be more focused and relevant.
Keeping such thoughts in mind, please add to them the second key observation Ballmer makes, according to the Guardian report, as follows:
“Some say that the ad-funded model has not led to profitability. Google’s search site makes money but past Google is there a publisher with an ad-funded or fee-based model that has made lots of money? No.”
For media businesses to successfully evolve they must provide the right combination of context and relevance to make a compelling online proposition for consumers.”
It’s always interesting to me that certain Internet stake-holders will admonish traditional media to reset their business models to leaner and meaner at the same time that big and fat seems to inform their own models online. It suggests that there is a hidden, but working assumption among the would-be new media barrons that not just the money, but the model of traditional media has moved online. Frankly (plus, simply) it is why so many online publishers are stumped trying to make money, including Microsoft. They behave as if the change impacting traditional media, including leaner/meaner, is peculiar to traditional media. That’s a mistake. The change applies to all media.
The truth is, there are plenty of web publishers online making lots of money. Lots. They just don’t look like Time Warner, or Tribune, or Microsoft. They are the right combination – as Ballmer recommends – of context and relevance, offering a compelling online proposition for consumers. But there are only two people in these companies. Or four. Maybe 10. They are small. They are focused. They are deeply suspicious of BIG. But they’ve given up their day jobs, put their kids through college, bought a boat, taken vacations and, basically, given the finger to “the suits” of the world and, for many, achieved substantial levels of job satisfaction.
Early-on, the venture capitalists and investment bankers used to scratch their heads and wonder about many of the mid-and long-tail publishers of the sort we represent at Burst. “How do they make money?” they’d ask. The real question they were asking, of course, was, “How do they make money on a par with CBS?” This is the question that has consistently led online media ventures to the edge, and over the edge. It caused the first Internet meltdown, and it keeps us feeling precariously balanced, in constant search of killer apps and formulas – something, anything to unlock buried treasures.
Steve Ballmer has the answer under his nose. It’s the same answer that made Microsoft possible when it helped topple the old main frame computer business. Big iron is the close relation of big media. And a computer on every desk and in every home is the close relation of a publisher in every garage and every basement.
The revolution that began with Windows and Apple is continuing.
Privacy comfort online
June 24th, 2009 § Leave a Comment
In the seat back pocket on one of the planes I was on this week was a discarded Time Magazine. Hmmm, I thought… something to look forward to after I finish reading my newspaper. I haven’t read an edition of Time Magazine in quite a while. When I finally pulled out the magazine I noted that the subscriber address printed on the bottom left of the front cover had been torn off. Interesting. Someone had finished reading through their edition of Time and desiring not to carry it any further had elected to leave it behind – appropriately sanitized for any personally identifiable information. It is, of course, exactly what I’d do. My wife, if she were there, would roll her eyes. I shred everything that comes into our house and goes back out again that has identifying marks that – I suppose- could be used to steal my identity. Many of those offers in the mail probably got there thanks to the magazine companies that re-marketed my subscription information. But, of course, throughout this week’s business trip I was passing around my credit card to strangers waiting on table at restaurants and bars, signing my name with no great concerns.
As arguments for privacy legislation continue to wend their way through Congress the santitized Time Magazine made me think how much nearer the edge of personal identification the outside media world lives and how, in comparison, online feels so much more private. There’s the irony, I suppose: that privacy online has the industry parading up and down the field in front of privacy advocates. Yet, online is not the privacy problem that disturbs me at home at night or makes me anxious about the things I leave on airplanes.
Conde Nast research tells us something we know, and something we ought to know
June 17th, 2009 § Leave a Comment
MediaPost reported on a study by Conde Nast and McPheters & Co. documenting that ads running on web sites with related content were 61% more likely to be recalled than ads running on web sites with unrelated content. This is not especially news, but it is always welcome news among publishers, on and offline, who invest considerable time and energy creating quality content for their audiences.
There was an interesting twist at the end of its report about the Conde Nast study, however, that MediaPost may have felt obliged to insert in the spirit of full-disclosure. I should do likewise. It’s truthfully more interesting (and bigger) than the news that the right message in the right place produces better results, which has been shown to be true since, maybe, 1517 when Martin Luther tacked his 95 Theses on the door of a church instead of a tavern. (One wonders if the Protestant Reformation would have got off the ground quite as well if patrons passing through the door were headed in for a drink instead of spiritual reflection.)
According to MediaPost, a Conde Nast study from earlier in the year (April, as I learned) revealed this about online advertising generally versus offline:
“According to data released earlier in the year by Condé Nast and McPheters & Co., nearly two-thirds — 63% — of banner ads were not seen by Web users. Respondents’ eyes “passed over” 37% of the Internet ads and “stopped” on slightly less than a third, McPheters found.
In contrast to online ads, TV and magazine ads generated a strong propensity to be seen and recalled, according to the research.
Full-page, four-color magazine ads were determined to have 83% of the value of a 30-second television commercial, while a typical Internet banner ad has 16% of the value.”
I missed that story last time. It is clearly - sadly- the most newsworthy piece in the context of Conde Nast’s research. And, rats, if you sell online advertising. One assumes Conde Nast went to market with partners McPheters & Co. (and CBS Vision) to bring back answers in defense of print and afterwards went back to the well for news to support their digital team. Well, they got it: Content matters.
Thanks. Very interesting.
Frankly, however, I’m inclined to want to pay careful attention to those results reported again at the end of today’s story. I suspect they may be more right than wrong in regard to Internet advertising, the distribution of which has appeared – and continues to appear – largely indiscriminate despite improved targeting features. Most of those features are late to the game and still devoid of consumer partnership – meaning, consumers don’t get that the messages may be targeted usefully towards them; they just see the same @$%! advertising everywhere and have conditioned themselves to ignore it.
The “content matters” question, therefore, is quite possibly more important than what it has been shown again to contribute to advertising that relies upon it. In the negative sense, advertising (and marketing) that does not offer proper context to its targets and customers may be cheating the advertising body politic as a whole.
Interesting. This may be an acute side-effect of an Internet pumped-up on data hormones; though magazines, most of which are specialized, might also be vulnerable if they were to suddenly start mainlining data. Consider a Fortune magazine edition with no business advertising and a Parenting magazine with nothing but business advertising. The effect would probably start to chip away at the 83% value quotient that print enjoys versus the :30 spot. The rational basis for the advertising in both publications might be the consumer, but the consumer’s associations are with the media. Eliminate the associations and advertising stops being break-through in the way that data can enhance break-through. It simply breaks. It stops making sense.
Conde Nast’s research is telling us something we know. More importantly, it is telling us something we ought to know and perhaps do something about (quick).
The International Advertising Festival in Cannes looms as a reminder that the advertising business isn’t what it use to be.
June 15th, 2009 § Leave a Comment
The International Advertising Festival in Cannes is scheduled to begin in less than a week and advertising critic and chaos theorist, Bob Garfield, is not looking forward to it judging from his column in Advertising Age today. Says he:
“They should give Crispin Porter & Bogusky every statue on Monday and send everybody to the airport. Gold. Silver. Titanium. Plutonium. Whatever.
Because first of all, apart from Burger King, the advertising year was a black hole worldwide. Besides, at this stage of Cannes’ history, what’s the point?”
The heart of advertising having gone out of the :30 second commercial, the death of creative at Cannes seems nearly final - or so it may appear. Of the 50 award front runners, reliably compiled over the years by Leo Burnett, Garfield reports that only 29 of them are TV commercials. The remainder are a mish-mash of online and offline submissions which by their nature have a hard time making us laugh or cry and, so, a hard time getting us worked-up enough to think happier thoughts about the state of advertising creative in the world today. If we are in Cannes, we will feel better going to the beach.
I’d have to go back and read it carefully again (which I’m not prepared to do just at this moment) to see if Bob Garfield spoke about progress when he launched his Chaos Scenario on the ad community. Clearly, advertising feels the rip-tide affect of significant changes that have been underway for a couple of decades. But is it chaos and disaster or progress? Can advertising reconstitute itself, creatively, in a post-film commercial world?
It can, but we must re-learn advertising creative - how to make it and how to experience it. At the moment, the un-tangling from TV commercial know-how has not been replaced with the know-how to make effective advertisements for an online and mobile world. The switch from one to the other is not automatic for any of us, creators or consumers. And, it is impossible that it would be, of course, given that big changes of the sort that have been taking place in advertising and media happen only one way: generationally, as one generation hands off to another.
The heirs-apparent of the TV generation were just getting comfortable in their corner offices when the creative protocols of New Media advertising descended on them. These were people that spent years navigating their way to those offices by dutifully absorbing the wisdom of their elders and, now, not enough of what they’d learned would pay for what they needed in a post-TV world. Worse for them - and us - finding what they needed might require asking the younger, dues-paying generation coming-up behind what they’d recommend, which old-timers everywhere are loath to do (and which the smugness of new generation-types doesn’t usually help).
One should not be surprised, then, that having to face forward and then backwards for advice and direction during their careers would make the current, transitional generation of advertising professionals feel irritable and less-fulfilled. The business ain’t what it use to be, or ought to be. As such, we won’t begrudge anyone a few trips to Cannes to wait out change on the beach. But we won’t be surprised, either, to find only 29, not-altogether-decent TV commercials and, then, a majority of other entries that we don’t fully understand, or warm to. We are leaving one art form behind while we learn another and our heart’s not completely in it.
We can’t have long to wait, however, before the ones and zeros of a digital age are making our creative motor go. Steve Ballmer, CEO of Microsoft, is going to be named Media Person of the Year at the Cannes festival next week, an unlikely prospect even a few short years ago when Microsoft was still in the software development business.
Advertising must feel the human condition. Data doesn’t get it there.
June 10th, 2009 § Leave a Comment
Aldon Hynes and I are on the same page. I don’t know Mr. Hynes, but in his post in digiday:Daily discussing Stephen Baker’s talk at the digiday:Target conference in New York yesterday he is scratching his head over the possible limits of the data targeting thing online, and I know that feeling.
As reported by Hynes, two very important points got made by Stephen Baker in his address at the conference: 1) If you talk about targeting people they will feel invaded, but if you talk about customized service they will feel rich; 2) there aren’t enough agency creatives in the world to accommodate all the targeting that might derive from the availability of online data with customized messages. Ergo, advertising is left to think and act at a group level.
The first point has especially strong ramifications: if you can whittle down to nearly me with all your targeting, then the opportunity better be a good one, made to order and fit. If you whittle down to me and the offer is, simply, come on in for a test drive, I may decide to move where you can’t find me. This places a considerable burden on marketers once they connect with a finely-tuned audience. The offers need to be customized.
Hynes turned to playwright Tom Stoppard to help make a broader point about current rage over data:
“It reminds me of a great line from the play Travesties by Tom Stoppard. In it, a Dadaist artist has a wonderful line to the effect, “It is the responsibility of the artist to laugh, and jeer, and howl, and belch at the common delusion that infinite generates of causes can be inferred from effects.”
And he suggests:
Perhaps creatives at ad agencies need a little more Dadaism in their own work. Instead of targeting fifty year old white males of a specific education and income level in Woodbridge, CT that own a dog, a cat, a hybrid, and have children in gifted education programs, they should target people that want to feel like they are accepted and belong to some group, people that are concerned about the economy, people with complicated emotional ties to their families, people that feel a little self-conscious when someone seems to stare at them from across the room…or so many other demographics that don’t really narrow things down very much but instead reflect the human condition.”
Of course, reflecting the human condition in enough detail to tell one shape from another has been the Internet’s most compelling media planning feature since the beginning. The Internet is ”brought to you” by the human condition. This is true of all media (a great reason to be in the business), but offline the human condition is available in a few standard programming sizes. Online, the human condition is available in all sizes.
Aldon Hynes raises the point that the human condition is largely about sharing and belonging. By design, however, data takes people out of their groups and reconstitutes them. In the process it is hard, if not impossible, to replicate the experiences and preferences that brought audiences together in the first place - around a web site, or a blog or social group - in a way that shares the value of their human condition with the advertiser.
J.C. Herz made much the same point in 2001 in the Industry Standard:
“The richness and complexity of an online experience, like the richness and complexity of a city, is created by the people who live there as they engage with the place and each other.”
Data can surround the advertising plan, but to achieve real results the advertising plan must surround the human condition.
Reports of the death of advertising are exaggerated
June 9th, 2009 § 1 Comment
Over at Buzzmachine.com Jeff Jarvis has been speculating on the decline of advertising in a one-to-one world linking consumers with marketers. Google presumably makes this possible. Social networking presumably makes this possible. They are the high-tech conduits of word-of-mouth, which has always had the underlying responsibility for building brands. Give consumers the power on their own through these and other tools to talk about brand experiences and marketers can cut out the middleman: advertising.
Rumors of the death of advertising are driven as well by the fact that advertising grew so pervasive and intrusive off-line that skipping commercials became a business, starting with the remote control, then the VCR, then TiVo, Napster, the iPod, etc. James Fallows gave time in his Atlantic Monthly blog last month to the idea that newspapers aren’t dying; instead, advertising is dying and dragging newspapers and other media down with it.
Here’s my take: nothing is dying. Newspapers aren’t dying, TV isn’t dying and advertising isn’t dying. To be sure, there may be a few deaths in the family, but the distinguished line of TV, print and advertising inheritors can look forward to a continued life of citizenship.
As an industry we have discussed that changes may have to be made by some of those inheritors in order to carry on their legacy. For the most part this means specialization, or enhanced relevancy. Newspapers don’t have to disappear, but they may have to stop trying to be all things to all people. Ditto most every media business. But, fortunately, most media types have shown themselves willing and capable of successful adaptation over the years, enough to ward off extinction.
Now it is important, however, to come to terms with the significant role that advertising has played in the survival skills of media through the years. Today, most media are utterly dependent on it, new and old. That dependency is making it hard for advertising to change in the ways it needs to in order to catch-up with others in a consumer-driven world. As the thing so totally and utterly responsible for powering the New Media Age advertising has been feeling recently that the world needs it more than it needs the world. Some have even said so.
Well, Jeff Jarvis and others are speculating this may not be true. I don’t agree; but their conjecture is not uninformed. The world dislikes advertising - the Internet world, I think, most especially – and the reason why is simple: advertising insists it has the right to be rewarded, which is fundamentally out of step with what every sensible marketer knows is true about the world in which it does business today – rewards are given at the discretion of consumers. The rather astonishing trail over the years of advertising innovations designed to reward advertisers online such as adware, pops-ups (then pop-unders), flashing banners, interstitial, home page take-overs, and even pre-roll have done nothing except leave room for the doomsayers to howl at the moon.
Can it be advertising by this or any other name if it is not so insistent and demanding? Can advertising let go and give itself over to the care and judgement of the users groups and web pages and the mobile telephones of consumer generations today and tomorrow? Can it be successful at cultivating consumer trial and loyalty? Yes, it can, if it agrees to second place behind the consumer.
Consumers have rewarded advertisers many times over the years that agree to see it their way. Research has regularly documented that subscribers especially value the shopping circulars in their Sunday newspapers, which despite the onslaught of new media still splash out of the paper onto the kitchen counter every weekend. What is a fashion magazine to readers without the fashion advertising? There is as much anticipation today over Super Bowl commercials as there is the game, a reward to advertisers for their bold creative efforts. The brilliant Herb Schmertz forever changed corporate image advertising and showed how to constructively engage audiences by underwriting Masterpiece Theatre on PBS in the 1980s for Mobil Oil.
Put the consumer first and great things can happen for business, including the business of advertising. Unfortunately, not enough of that takes place online where, instead, it was suppose to be pay-back time for advertisers: one-to-one advertising, nothing lost or wasted. A little “me time” for beleaguered ad executives desperate to show that, “Yes, we can.”
Bad idea. Wrong for the times. Especially wrong for the medium and its value proposition to users. Of all places, the Internet, a consumer-driven, owned and operated, ours not yours, media tapestry with genetic hyper-sensitivity to third-party encroachment and control was the wrong place for advertising to insist on the spot at the front of the line. After much banging around, we are now in serious trouble of regulation that is thoroughly disconnected from practical reality and – worse - out of proportion to the more significant encroachments that exist offline. And, unfortunately, the facts really don’t enter into it. As of now, it’s perception not reality. How ironic.
As a consumer I have no satisfactory response for advertisers that have been denied for so long the answer to Mr Wanamaker’s question. When I’m not busy selling the virtues of vertical niche content online, I am a media consumer and as a consumer I have no reliable guidance for advertisers that wish to engage me.
“When would be a good time to talk?” I don’t know. I suppose when I’m in the mood. I suppose when I’m thinking about whatever it is that I’m thinking (note veiled, commerical reference to vertical niche content above). I suppose if you have something clever to say. But I need my space. Please don’t hover. If I have questions, I’ll ask. That’s my attitude and, I suspect, the attitude of many consumers.
I don’t know how Mr. Schmertz measured the effectiveness of his corporate underwriting experience back in the 80s. It was a sensation and gave him a certain celebrity along with his pioneering use of op-ed advertising positions. He wrote a book. I suppose he did some research to measure favorability of Mobil among the opinion-leader demo that was his target. Still, today, however, I expect to see Mobil (now Exxon Mobil) as the underwriter of Masterpiece Theatre and I will forever associate the company with citizenship, whether I agree with them or not. And while it may or may not be connected, I really have always favored their brand when buying gasoline, which leads me to report, sadly, that Exxon Mobil is pulling out of Eastern Massachusetts. The stations will be replaced with Gulf. Ifeel like I’ve lost a life-long community connection that I had learned to trust – a connection that had its roots in advertising and gave me something interesting along the way.
Advertising is about consumers and no one talks about the death of consumers as a marketplace constituency. Make advertising the servant of consumers, in the way advertisers do their products, and its future is assured.