Microsoft + Yahoo! = Opportunity for Everyone

By now, everyone has read the news about Microsoft’s bid for Yahoo!. This isn’t really a surprise, but could be insight into a lot of other possiblities. I won’t go into the millions of reasons that are all over the internet about why it will or won’t work, but I do want to discuss some possiblities. This could be a great opportunity for small/medium size business for a few reason. Besides the obvious advantages of having a competive market in online advertisng platforms, this will push the speed of innovation of web services faster. This is a major positive for small/medium busines s (SMB) advertisers and Microsoft. Online advertising allows Microsoft can have a direct relationship with small/medium businesses and offer products that are affordable for the customer (advertiser) and remain profitable for MS. 

The one thing MS has perfected is the reseller model. Why not apply that model to online services and software? MS could extend their reach if they utilized a VAR system through ad agencies or software resellers. This allows a deeper relationship with small companies and more exposure to MS products. Email, storage, hosting and advertising could all be sold via VAR system through a MS reseller. With the reach that Yahoo! and Microsoft would have in online media, this would be a great tool for SMBs and a business model familar to Microsoft that they can rally around.

Social Media Getting Really Interactive

As most of my friends have to come to realize, I am in love with Facebook. I know earlier I wrote that it would be a phase like most social networks, but what can I say, I love it. What Facebook is bringing to light is the emergence of applications as an advertising mechanism. The interactive component combined with the pure social and viral aspect of the applications make this the most targeted, interactive advertising tool on the market (maybe). One of the best apps I have seen is Flixster. It has a stickiness that feeds into the core of social networking. It’s a simple program that ask you questions on a set list of movies and compares your answers to your friends or anyone you invite. As a user, I love seeing the comparisons between my friends.  As an advertiser, I see viral marketing and behavior targeting at its best. Applications are still in their infant stage, but will be big players in the next couple of years. I expect utilizing to see more content owners to start utilizing applications as an advertising platform by 2009.

Is Facebook the next AOL?

In the early 90’s it was very clear that AOL sat at the top of the Internet world. A world full of dial up connections and bad websites. There were many players in the dial up game (Juno, Earthlink, NetZero, and MSN), but AOL stood above the rest. They capitalized on the new market by providing an integrated online experience through its portal. AOL provided the means to get online and helped organized your experience with their portal.

That portal was essentially a platform and that along with great branding (I miss the free CDs) separated AOL from the bunch and stood dominate for a long time. AOL became the place to advertise if you wanted to reach a high quality audience with your online marketing efforts. I still remember buying AOL keywords. Times have really changed, but have they?

Facebook’s story is the new version of AOL. They created a platform that keeps the user in the experience with limited ability to customize. The buzz around companies building applications for Facebook is either a sign that this model will work or these companies fear they will miss the boat on the opportunity.

Over the last 6 months, we’ve seen MySpace, the most popular social network in the US, decline in popularity and we are starting to realize that people have profiles on multiple social networks and loyalty is not a high characteristic of this audience. Facebook will continue to have astonishing growth for the next few years, but like all history tells us, it will come to an end. Enjoy the ride!

Why are publishers buying Ad Agencies (DoubleClick and aQuantive)?

These deals were about technology, not the agency. Publishers will struggle to figure out how to incorporate if they incorporate at all. So my take on this is that agencies won’t go away because you still need a team that will work across the various distribution channels.

Options for publishers are to sell the agencies to one of the large traditional agencies (i.e. IPG) that are currently trying to bring the competency in-house and keep more of their client’s dollars with their business, the other is to let them operate as they are now, figure it out what it means later. Having an agency does serve as a great testing ground to help build agency tools.

These deals are indicators that the landscape of advertising taking a big swing back to interactive with traditional advertising. Past thoughts were the internet will take TV dollars, that’s not the case it simply means the internet will be part of the conversations upfront instead of an afterthought to help advertisers reach their numbers. The internet provides an extended reach that advertisers will pay for. TV is supported by advertising dollars that hinge their success on the current ratings system that at best is fuzzy math. Not sure how 1,000 black boxes in undisclosed locations represents all of America. If we used TVs ratings systems in online advertising, we would be laughed out of a meeting.

Take a look at when people were spending all this money on “eyeballs” back in the late 90’s. That model crashed and they thought the internet was doomed because it couldn’t be measured. Search marketing brought credibility back to online advertising along with the smash success of YouTube, MySpace and Facebook. Don’t forget traditional media has played a big part in these sites being successful. My mom knows about MySpace because she saw it on TV, not because she was looking up people’s profiles.

The power of the internet is content. Leaders of this industry will be those companies that either own the content or can provide the tools that deliver them. And being able to monetize that is the key to all of it.

How to Creating an e-CRM Program

I was cleaning out my ftp server and found this article I wrote 5 years ago. I realize that marketing just doesnt change .

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“CRM’s original strategy was to help companies better manage and understand their relationship with their customers,” AMR Research analyst Kevin Scott (on CRMDaily.com). “Somewhere along the line, the acronym became really hot.” Customer Relationship Management (CRM) has become a larger player in strategic planning with the demands of higher return on investment in a tighter market. CRM starts with the information that you have already collected from your customers. Information such as: What did they purchase? What information drew the most interest? Where are they located? What time do they browse your website? Effective CRM programs consist of 5 basic parts: Profiling, Targeting, Timing, Delivery and Tracking. :::: Profiling :::: Profiles can be demographically or behaviorally based, and the difference is very important to your business. This allows you to create a customer profile around the goal of selling a product/service or increasing website traffic, but what is a customer profile? Here are 2 kinds of customer profiles: Customer is single, has no children, lives in an upscale neighborhood, reads the New York Times, and surfs the Internet at home. Customer visited the site daily for 3 months, but has not visited the site the past 2 weeks. The first profile is demographic, offering a set of characteristics. The second profile is behavior-based, involving what the customer is actually doing. Which seems more important to you? Importance is contingent on the goal of the CRM program. Is the goal to sell a product or service to the customer or to increase visits to the website? For a company selling a product or service, make an offer that is relevant to the consumer’s lifestyle. If the goal is to increase the website traffic, research the most popular pages and what changes increased or decrease repeat visitors. :::: Targeting and Timing :::: Segment your customers by interest or demographically. Offers must be as relevant to customer’s needs and/or wants as possible. This will increase the probability of action. Timing is equally as important as relevance. Knowing when to offer a deal or change your website content determines your ROI on your CRM campaign. When deciding your target and timing these questions should be addressed: Who do I e-mail offers to? When do I e-mail them? How often? Should I promote to some customers more often than others? How much incentive should I provide to get a customer to take action? How can I tell when I’m losing a customer? What can I expect in future sales from my existing customers? :::: Delivery and Tracking :::: Delivering the right message at the right time in the right form. This is the goal of every marketer when building media schedules and promotions. Plan to answer the following questions when viewing your analytics: What is the most effective channel for conversions for my business? What is the percentage of online customers that convert online? What incentives push users to a more cost effective transactional channel?  Balancing these issues will add a tremendous amount of value and dollars to your bottom line.

Customize Your Customization

I recently attended a marketing summit at Harvard Business School (only visiting) on customization. On the panel were representatives from Dell, Target and Digitas. The topics obviously were around the benefits of customizing products or services for customers to create a better experience, increase market differentiators and increase loyalty.

All those working in the Internet marketing space understands that all too well, but how much customization is too much? At what point do you offer customers too much control over what they want? There are companies that have gotten this right, Dell, Starbuck’s and Wendy’s (not Burger King).

What happens when everything can be customized, from TV to radio to even magazines? We know this is on the horizon and already here in some form (satellite radio and TiVo), but what if this customization was a standard and not a premium. Is there truly a benefit and profit in customizing? More thoughts on this coming soon.

You’ve Got Mail!

Over the last 10 years, the e-mail marketing industry has matured from, what is known today as, SPAM to become a core part of customer relationship management. There are multiple companies working to consolidate this industry, but with low entry cost and a fast climb to profitability, more e-mail marketing companies will continue to spring up. Profitability will not come from large corporations that demand a high level of program management, but from the small business market.

Small businesses are the fastest growing and most profitable sector when analyzing an e-mail service provider’s (ESP) Return on Investment. They are also the most non loyal due to the low investment cost with the ESP. The e-mail industry will continue to see more large data companies purchase promising ESPs that offer complimentary services to e-mail marketing.

Minority Report

The growing number of access points to the Internet has changed the face of the typical online user. Computers in the home can no longer be used to measure Internet users and the growing number of minorities online can not be ignored. Minority online purchasers are growing at a much higher rate per a recent DMA report (The DMA 2005 Hispanic Report Market Report). The average household income of minority online purchers are higher, but this trend will also change at a much higher rate than whites.

International Internet Marketing

With the rebirth of online marketing, international consumers may prove to be a very open market for U.S. based companies. The growth of China will do more than lower manufactoring cost, Hong Kong ranks as one of the fastest growing areas of Internet users. This will challenge Internet gurus to understand international user trends that will vastly differ from the mature U.S. markets.

Clicking for Cash

Pay-per-click (ppc) advertising has become a major player in Internet advertising, but has the art of site optimization lost it’s luster? Although organic listings continue to generate more site traffic, headlines are blanketed with ppc’s return on investment. Is there a comprehensive, creditable report on ROI from organic search listings?

Marketers can maximize the use of ppc advertings if organic listings are added to this equation. There are a limited number of companies offering services to manage both organic and paid listings (I’ll refrain from providing free advertings for them). This should be a hot topic in 2005.