As we know, 2007 forever changed the way marketing dollars are allocated in all media. If we're waiting for traditional media to once again gain it's stronghold of advertising dollars, it's going to look and more importantly, it's going to come from different places. With Internet taking up to 8% of local dollars and in some cases, higher depending on the market size, here are some tips from "Online Marketing Trends" that I thought you might want to share with your sellers.
In our study of radio sales across the nation, we've seen a 20% or greater reduction in spending on radio-almost the same for TV and at our Internet properties, we've seen an 18% or greater average in revenue-and those revenue models do not include radio or any affiliation with radio stations. They are separate identities. Here are some tips. You might want to hang this on the walls in your office! They won't go away anytime soon!
Online Marketing
Trends in 2009
2009 has been a challenging year for many businesses as the global economic slowdown takes hold.
Digital marketing, however, looks set to continue its rapid growth, as its many solutions and advantages become
even more apparent when marketing budgets are subjected to even greater constraints.
Here are 16 important online marketing trends for 2009 and beyond as we see them, along with our view on the best
strategies.
Keyword inflation will continue
The need for advertisers to improve the effectiveness and measurability of their advertising spend will become
more acute. As more budget moves to digital, the marketplace will become increasingly crowded, with the extra
demand pushing up paid search costs. Keyword inflation, also called cost-per-click (CPC) inflation, is running
at 20% for 2008 across all markets (according to Jupiter research), and we believe the figure for 2009 will remain
high despite the downturn.
Strange view: Since increased click-costs will affect cost per acquisition (CPA), advertisers will need to
concentrate on improving conversion rates to offset keyword inflation.
Conversion optimization will be key
Assuming the current level of keyword inflation, conversion rates will need to improve to keep CPA at the same
level. The pressure will be on for advertisers to find solutions that can really improve their return on investment
(ROI) by offering end-to-end optimization for search, display advertising, affiliate marketing and email marketing.
Strange view: Controlled testing is the best way to get results. A/B split tests and multivariate testing
(evaluating the impact of combinations of changes simultaneously) and click tracking should be defaults within
your programme of web site improvements. Eye tracking projects could become a necessity rather than a luxury.
Consumer thrift will shape online
behavior
As the recession bites, consumers will increasingly shop online in search of deals and bargains, especially
through auction web sites and ad listings. So Craigslist, Gum Tree, eBay and many more web sites will, in all
likelihood, see their traffic rocket.
Strange view: In a downturn, retention of market share is crucial and marketers need to be aggressive. Online
retailers have to get their offering in shape (with the possible exception of luxury products) and get users on their
sites. Online businesses will need to think about incentives, offers and deals as standard operating procedure.
Incentives for customers to come back will be crucial, in order to up-sell or cross-sell. Well-positioned loss
leaders are a good way to shape consumer perceptions and keep them coming back for more.
Great Creative will be required
This may sound obvious, but it needs to be emphasized: digital marketing will continue to rely heavily on
creative to achieve its objectives and make the campaigns and strategies work. Good creative is what makes
your display advertising disruptive, your landing page user-friendly and your web site trustworthy. It
communicates your message and builds affinity with your brand. And although in times of economic downturns,
emotional matters can seem less important to the bottom line, creative is THE key element affecting all online
marketing channels and, therefore, ROI.
Strange view: Creative is the ?X factor? that will steer you through the difficult times ahead because the right
design, the right copy and the right message are what activate users. This is why we describe what we do at
Strange as ?creative digital marketing? rather than just ?digital marketing?.
Internet Explorer 8 will affect online
advertising
The launch of Microsoft?s browser Internet Explorer 8 (IE8) is massively important, since it is the default browser
on Windows boxes. And while it may not be as sleek as Goggle?s Chrome or Mozilla Firefox, most consumers
will happily muddle along with IE8 oblivious to alternatives. The privacy browsing capabilities of IE8 will have
an impact for online advertising if there is widespread usage, since it blocks the tracking cookies at the heart of
online advertising and traffic analytics.
Strange view: What Microsoft giveth in standards compliance it also taketh away in privacy mode. The IE8
privacy mode, which avoids third-party cookies might cause some initial headaches where ad serving and
tracking is concerned.
CPA buying will become more widely
negotiated
The CPA (cost-per-action/acquisition) digital advertising buying model will become more widely negotiated. The
biggest online advertisers are already spending over 50% of budget on CPA media and in difficult times, where
direct response is more important than branding goals, more advertisers will be looking to this model.
Strange view: CPA is great for advertisers because ad costs are directly proportional to action/acquisition
conversion rates. As the climate gets tougher, advertisers will have to focus on ROI and negotiate hard with
publishers to achieve CPA deal terms. We do not believe that the CPM (cost-per thousand) and CPC models
are dead, as they have their place in providing brand awareness, but the CPA model should be the larger
component in the marketing mix.
Data privacy and security will stay in the
headlines
Data security and privacy issues are likely to continue to hit the headlines throughout 2009. Whether in be
Phorm or GCHQ snooping on what we?re up to, or government agencies and businesses losing more
unencrypted data in laptops, dongles and CDs.
Strange view: Data protection is going to be more than just a security issue; it will have huge PR and brand
Online marketing trends for 2009
consequences for anyone getting it wrong. The privacy browsing capabilities of Chrome and IE8 will have an
impact for online advertising if there is widespread usage as mentioned above. Businesses will need to audit
their data handling and security practices and get the right processes in place. Expect to see some major class
actions by consumers against businesses that have had their data breached, stolen or lost.
Qualitative analytics will have greater
emphasis
Knowing what your web site users did is nice, but knowing WHY they it did will become crucial. We predict that
there will be huge growth in the use of qualitative data in analytics and decision making in 2009. User surveys,
email questionnaires, internal search analysis, user complaints, customer service forms, FAQ feedback, A/B and
multivariate testing, eye tracking and click-density analysis are all going to become essential tools in your quest
for qualitative data that will help you improve and optimize ROI.
Strange view: It?s all about getting the right message from your analytics ? and reporting it clearly ? so that you
can make informed decisions. Qualitative measures of web site performance will enable you to optimize with
greater certainty. Also, in quantitative click-stream analytics, look out for Yahoo?s answer to Goggle Analytics ? a
free version of Index Tools.
Mobile advertising will flourish
With Goggle supplying mobile hardware (G1) and software (Android), and bidding on the wireless spectrum, it
is clear that the people at Mountain View wish to develop this market to its full potential. 3G smart phones with
large-ish screens, such as the iPhone, BlackBerry Storm and G1 all allow mobile users a close-to-normal
web-browsing experience. And as mobile usability improves, so will mobile Internet use. Google is moving fast
to develop, exploit and control mobile advertising by dictating the platforms and mechanisms we use to browse
the web on our smart phones, while also leveraging the mobile wireless spectrum.
Strange view: If you?re not already thinking about your mobile strategy, now is the time to start. Those brands
that get into this channel early on will benefit most from its massive growth potential.
Local search/localized services will grow
Search engines, browsers and hardware manufacturers will continue to put their weight behind the localization
of search. Why? Three main reasons: 1.) Results are more relevant, 2.) advertising can be more accurately
targeted, and 3.) it gives search networks a massive additional inventory to sell at a local, rather than regional or
national level.
The reason why 2009 is the year for local search to take off is that the Gears project (an open source project
that enables more powerful web applications, by adding new features to your web browser) offers a
geo-location API, as does Mozilla Geode and Yahoo! Fire Eagle. There will also be high-speed packet access
(HSDPA)-ready laptops and netbooks, on top of the existing GPS smart phones and palms, all of which will allow
the UK search engines to retrieve a more meaningful geo-location than is currently available via Internet provider
(IP) lookup.
Strange view: Advertisers need to be aware of the range of localized search possibilities becoming available
and gear their offering to meet consumer demand.
Online marketing trends for 2009
RSS news feeds will go mainstream
Really Simple Syndication (RSS) is an ideal platform for online marketing and communications as it provides
marketers with 100% deliver ability and a qualified audience. Having come through the early-adopter doldrums,
RSS will most likely see a surge in uptake in 2009, moving into majority usage thanks largely to built-in support
in the new IE 8 browser.
Strange view: There are three main advantages with RSS for both users and marketers: 1.) users only get data
they?ve subscribed to, thereby avoiding any spam issues, 2.) users can increasingly select segmentation of
news feeds so they only receive specific topic information, and 3.) the user can receive RSS news feeds in a
plethora of ways ? with their Internet browser, an email client, desktop or web aggregator or on a mobile or
handheld. This freedom to receive the feed in any number of ways means the user is in control, making
recipients a more qualified audience that those receiving email marketing.
More user behavior metrics will be
applied to the Goggle algorithm
Speculation that Goggle will shift its algorithm to favor more user behavior metrics is growing. In fact, Goggle
has openly discussed these algorithmic approaches in a patent application called ?Information retrieval based
on historical data? (
http://tinyurl.com/5fpfj) filed back in 2003.
We?ve already seen some of these elements such as domain history and backlink velocity hit the Google
algorithm, but what some commentators are now suggesting is that behavior metrics are on the cards. That
would mean metrics such as click-through-rates and bounce-rates being used to assess relevancy values in the
search results.
Strange view: Over time, poorly performing web sites will be downgraded in the search results, while web sites
that people use and stay on will be nudged up. What this means for online businesses is that relevancy,
quality and engagement are going to be business multipliers, affecting not only conversion rates, but also
natural search traffic volumes.
Netbooks signaling things to come
ATT and Sprint have gotten on the netbook bandwagon. Offering cheap or free netbooks for 2+ year contracts on their data plans. Granted everyone likes the idea of having a tiny laptop that weighs almost nothing and neatly fits in your purse or man bag. The reality is these devices are just putting us closer to the next evolution in computing. Cell phones have evolved into miniature laptops with a full QWERTY keyboards, 800 pixel wide displays, touch screens, WIFI, 3G and UMTS data connection. Laptops have gotten smaller with better battery life. Eventually there will be little distinction between the two devices and the major players are positioning to dominate this growing market. Eventually Cell phones will be powerful enough to run a full operating system such as Windows 7. Even though this is several years away, for the time being larger websites are developing APPs catering to some of the most popular devices ( IPhone, G1, Palm Pre, Windows Mobile Devices ). As wireless connection speeds get greater, there will be a transition to doing everything over IP communications. Many are familiar with VOIP. Google is pushing to get supporting APPs on cell phones, but many wireless carriers are not happy, as this would result in people not needing minutes to make calls. Apple has already banned several APPs that would provide VOIP on the Iphone, and the Feds are investigating it. IPTV is another transition that could threaten cable operators. There are already hundreds of TV stations that broadcast via IPTV. TVs at the major Future Electronics shows are already showing that IPTV is the direction they want to take. What if a person only had to pay the $50 / month for their internet connection, and would no longer need cable or phone? Over the next 5 years we will see a major shift in how consumers get their media.
User generated content (UGC) will
be King
A Universal McCann study in 2008 found that only 14% of users trust advertising, whereas 78% trust
recommendations of other consumers. This highlights something many online marketers have known for a
while: user generated content can be very beneficial
Online marketing trends for 2009
Strange view: UGC such as in blog comments, product reviews, video reviews, creative competitions,
galleries, and other content has significant benefits: 1.) Brand perception - open, honest, approachable, 2.)
Brand engagement - users can contribute and get involved, 3.) Brand dialogue - customers feel important and
listened to, 4) Brand trust - your products/services must be good because you let users scrutinize them, 5) Value
added - UGC galleries, product reviews and video reviews offer users more immersion and engagement, and
6.) Free content - your users are helping to improve your offering for free.
Social media opportunities will expand
According to research by Universal McCann, 73% of users read blogs and 36% think more positively about
brands that have them. In addition, 83% of users have viewed video clips (proven to offer significant uplift in
sales), 49% have downloaded pod casts and 38% have subscribed to an RSS feed, while 57% have joined a
social network. We could go on, but suffice to say that social media has well and truly arrived and if you don't
use it to your advantage, then you're missing a massive opportunity.
Strange view: Get a blog, tell people who you are, what you're doing and why you're great, and offer them
information and resources that enrich their lives and user experiences. Use to your advantage social networks
and book marking, RSS, on-site and off-site video, as well as audio and image resources. You can leverage
users to become brand advocates and engender brand loyalty through engagement and an open,
customer-facing approach. And you can utilize UGC and blend data in useful mashups that make your web site
a must-see/must-use place to go. APIs and mashups could be the Next
Big Thing
Far be it from us to predict the next Facebook or Last.fm success story, but the odds on it being a mashup are
not bad. Application programme interfaces (APIs) allow desktop and mobile applications to access web data
and services directly, giving rise to services such as iTunes, RSS readers, desktop weather widgets, Xbox Live
and Play Station Network, to name but a few. Building on this, mashups bring together, manipulate and present complex interrelationships of data asinformation resources that were previously inconceivable. Growing fast in number, the beauty of good mashups is that they have the real synergy, making them greater than their component parts and thereby providing richer user experiences and deeper information resources.
Strange view: Yahoo! Pipes is a great consumer-facing mechanism for manipulating data, while Goggle?s Gears
and Goggle Maps are incredibly useful and powerful tools. We will have to wait and see what weird and
wonderful things the web community comes up with next, but we do know that 2009 will see developers unleash more web sites and applications to seize the public imagination and transform the space.