You are currently browsing the archives for March, 2007.
Quote of the month, in my book, comes from Hugh at Gaping Void who concludes a piece on Nike leaving Wieden & Kennedy with this line:
“Behold the future of advertising etc. Buying space in someone else’s brain is far harder than buying space in someone else’s media etc etc.”
Note, the cartoon that accompanies the post includes some naughty language.
Well, maybe that’s a bit dramatic. But the magazine publisher’s CEO announced that new IDG publications will launch as websites and will earn the right to become print magazines only if the web readers demand it in big enough numbers. From PaidContent:
“Pat McGovern, the companyâ€™s founder and chairman, in an interview on Mediashift discusses the prospect of starting all new magazine ventures online and polling readers as to whether to form a print version out of it.”
Inevitable, I guess, given the plight of business-to-business print magazines over the past 5 years.Â But this move signals an end to the quixotic optimism, at IDG anyway, that the internet will eventually go away and return our readers to their senses.
Last month, Dell launched a program called IdeaStorm to allow customers to give them feedback on their products. Yesterday they announced that they’re making some changes to their product offering based on what they learned:
“…one idea has risen to and stayed at the top: better support for Linux. We have heard you and appreciate the direct feedback. On March 13, we responded by launching a Linux survey asking for your feedback on what you need for a better Linux experience. Thank you to the more than 100,000 people who took the survey….
Dell has heard you and we will expand our Linux support beyond our existing servers and Precision workstation line. Our first step in this effort is offering Linux pre-installed on select desktop and notebook systems. We will provide an update in the coming weeks that includes detailed information on which systems we will offer, our testing and certification efforts, and the Linux distribution(s) that will be available. The countdown begins today.”
That wasn’t so hard now, was it?!
Good point raised by Clickz regarding Microsoft’s rumored acquisition of DoubleClick:
“If a deal with Microsoft does become reality, it would boost the firm’s online ad capabilities and make for readymade relationships with advertisers and agencies. However, it could put DoubleClick in hot water with its publisher clients, including AOL, which would be loathe to let the company access user data flowing through DoubleClick’s DART ad serving system, and which compete directly with Microsoft’s MSN for ad dollars.”
“the automotive industry — which spends more on advertising than any other industry — is … shifting dollars out of television, newspapers and magazines to the Internet. This trend is expected to continue as auto marketers focus on consumer engagement and look for more measurable media interactions, according to eMarketer’s latest report, Automotive Online: The Race Is On.Â In 2005, total ad spending by the US auto industry declined 3.4% to $21 billion, but online spending increased 37%. This increased online ad spending is going to microsites, social networks, rich media, paid search and display ads.Â eMarketer estimates that in 2007, auto manufacturers, dealers and after-market vendors will account for $2.54 billion of the $19.5 billion total spent online.”
AdAge’s Bob Garfield paints a picture of today’s media landscape, “Chaos Scenario 2.0″ he calls it.
Obviously traditional models are under seige…
- In December 2005, Viacom spun off CBS, the so-called Tiffany Network, lest the broadcast business impede growth and depress shareholder value.
- Just before Christmas 2005, Time Inc. laid off 100 employees. Just after Christmas, in January 2006, Time Inc. laid off 100 more employees. In April 2006, Time Inc. laid off 250 more employees — the last round of job cuts, the company said. In January, Time Inc. laid off 300 more employees. No wonder. Since 2001, Time Warner’s market capitalization has shrunk to $82 billion from $193 billion.
- Last fall, ostensibly to promote their new seasons, five broadcast networks bypassed their local affiliates and gave away new programs online.
- In October 2006, NBC announced a $750 million cost cutback, including 700 jobs and a moratorium on scripted programs in the first hour of prime time.
- In November 2006, Clear Channel — the boogeyman of media consolidation — sold to private-equity owners and declared that it wants to unload its TV and small-market radio stations. The sale fetched $38 a share. In 2000, the stock sold at $100 a share.
- The Minneapolis Star Tribune, acquired by McClatchy in 1998 for $1.2 billion, was sold to private investors in December 2006 for $530 million.
- In 2000, Chicago-based Tribune Co. was valued at $12 billion. It then bought Times-Mirror Co. for more than $8 billion. At this writing, with Tribune Co. for sale as a whole or in part, the value of the merged company is $7.34 billion.
- YouTube. Two years ago, it — much less Joost and Revver and Brightcove and the online-video industry in general — did not exist.
“The online space isn’t remotely developed enough — nor will it be anytime soon — to absorb the advertising budgets of the top 100 marketers, to match the reach of traditional media or to fulfill the content desires of the audience…. A collapsing old model. An unconstructed new model. Paralyzed marketers. Disenchanted consumers. It’s all so … chaotic.”
Old media clings desperately, perhaps blindly, to failing models and business practices, while — in the process of forging the new models — the digital media innovators want to abandon everything “old media,” the good with the bad.Â Ad networks, contextual ad-matching bots and auction buying platforms bring much-needed efficiency to cumbersome delivery and transaction systems, but without more human intervention they won’t give brand advertisers the confidence to bring their giant ad budgets online.
Last year Netscape relaunched their portal with a user-voting feature, just like Digg! But, alas, building a community requires more than a button to allow user voting. From WSJ:
“Some apparently thought Digg’s appeal could be imported. Executives at Netscape.com, the home page for the once-popular browser, last summer redesigned their site to make it Digg-like. Netscape.com had been a ‘traditional’ Web portal, displaying news and feature stories selected by editors. Now, Netscape readers were going to be submitting and voting on stories themselves.
“But Netscape customers apparently were happy to let editors do those chores for them. When they voted, it was with their feet. Since September, when Netscape made other changes that affected readership, traffic at Netscape.com has dropped 28%, reports Hitwise.”
Jeff Jarvis helped coordinate a creative online ad program for Dupont: Short videos profiling Dupont technologies like Kevlar, starring the original host of Rocketboom, Amanda Congdon (BuzzMachine). In an interview with Clickz, Dupont’s Gary Spangler is pleased with the results.
“‘We were looking for a hostess or host that would be interesting to the viewers,’ said Spangler. ‘I was familiar with Rocketboom and knew Amanda has … online viewership and is already skilled in video blogging. Her experience and acceptance by a large audience around her delivery and appeal led us to think she was a clear choice for delivering these messages.’”
Dupont is running the spots on several FM sites (thanks, Dupont and Starcom!): Digg, Boing Boing, the Athanasius Kircher Society, Left Lane News and Boompa.
A Screen Digest report cited by PaidContent says massively multiplayer online games (World of Warcraft, Second Life, etc) generated $1 billion in revenue from their North American and European customers via subscriptions, in-game advertising and products and services in 2006. World of Warcraft took in most of that money:
“Itâ€™s a pretty big figure, but if you note that World of Warcraft has 3 million subscribers in the west (out of 8 million globally) paying monthly subscription fees of $13-15, it becomes more believable. WoW accounted for 54 percent of the subscription market in 2006, pulling in $471 million in revenue.”