The Future of Marketing

I’ve been thinking about the future of advertising & marketing lately sincem y boss is off to SXSW this week. I’ve found that in the last decade there is a new trend that takes over as the next-big-thing in online marketing every 2 years.

Before that, the TV/Radio/Print models lasted for about 50 years. I used to think that we were looking for the next big model/philosophy for advertising and things would settle into a steady pattern for the next 20 years but I am beginning to doubt that is going to be possible.

Either we’re still evolving or we’re going to always be evolving from now on. I don’t see any stopping in the development of new devices that use the internet nor the methods in how people use them.

This could prove exhausting for companies having to add another “expert” to their teams every year or so instead of making sure their staff has time to learn on the job, which they really should do. It also means that unless there is a new person or time to learn for companies, their effective advertising will become less effective every year they use it just because behavior is changing so rapidly.

A look at what is hot now and what has been popular in the last 10 years.

Facebook seemed to be the biggest advertising/marketing trend of the year in 2010 and companies I work with have jumped on the bandwagon in 2010-2011. I think this is definitely where people are online for a large chunk of their day, turning it into a communication channel for your company isn’t as easy as it looks. I’ve been on FB since they opened it to people with a company email address and I have been hesitant to share that much personal info with a public database like that but the general public seems to either keep it fluffy in content or not care. Ads on the site do generate interest, but at lower click through rates than any other ad medium I’ve seen.

Twitter has also become laser-hot in the last 2 years and has exploded because of celebrity use and the popularity explosion of smartphones on the US market. Direct P2P marketing is the main method if twitter use in my opinion, and they really don’t charge for it in any way. The downsides here are that your tweets are really only alive for 1 day and then they die, and are taken out of the searchable database if someone is not a subscriber.

Blogs have been all the rage for the last 2-4 years but people have backed off lately because content farms were really making them look bad, content is expensive/time consuming to produce and all the blog ad networks that provided a reliable income from it have either gone under or are paying less than 20% of what they used to or have no inventory. So even if you’re hosting for $10 per month and paying some person in india $5 per article you really can’t make the Google AdSense $ to cover it anymore, and there are few networks paying more than $0.25 per CPM. And since you’re less likley to get blog traffic via search these days you have to build a loyal following, and that is either long hours researching cutting edge news content/analysis or going out and shaking a lot of hands in person. Bloggers typically don’t like people all that much. Also, RSS push notifications were supposed to make Blogs portable to any reader anwhere and instead they just became geeky things body understood and nobody used. Bummer. WordPress (and earlier TypePad and Blogger) were the real catalysts here. They gave regular non-programming people the ability to publish anything they want on the web for free without programming a site or knowing HTML. It was revolutionary until we all remembered how hard the Newspaper business really is and how it is far too time consuming to be profitable. Real bloggers blog because they love it, not to make money. Blogs are also a great way to publish content for free if your business is content, that’s not going away anytime soon.

Blogs were super valuable when they were super influential for Search. Search engines were the marketing darling of 2004-2006 and have slid in ROI ever since. Google has made higher minimum bids a regular practice and people have become desensitized to ads. These super targeted ways of reaching people with relevance have also been taken over by giant companies that used them for branding rather than content relevance and watered down their effectiveness. People have also noticed the spam in search and trust Google results less knowing people work the system. Some blogs gained traction as content/news sources that people subscribed to instead of newspapers and propelled real people into the reporting limelight, the rest became archives of people’s personal lives or were spammy and forgotten. Some people will probably stay with search as their core online activity for the rest of their lives because it made such an impact, but others are moving on.

SEO has been the secret marketing tactic of the last 5 years and it has only lasted that long because it has been so hard to build links for SEO and figure out how the algorithm has changed. Lately though companies have been gaming it more than ever and there is too much knowledge on how to Google Bomb something and people know garbage results when they see them. So, there has been more trust transferred to social networks where people rely on their network of friends to filter the news and just pass on what is really meaningful. This method isn’t about discovery or archiving like search was, it is about instant feedback and the trust of the people you know. Bing has not gained much traction and with Google as the only worldwide player, they will continue to do what they want to maximize profits and favor big companies rather than work on the algorithm and better understanding how people want information. SEO will always be needed and always be challenging.

Email is the old skool way to do things online and time spent in email these days is dropping significantly. People have taken their communication with friends to FB & Twitter and we know how to read/process email a lot faster than we did years ago, so less time is needed. Yet it is still the main method of communication/task management for businesses because of the electronic paper trail it creates for projects/accountability. Real Spam, marketing spam, inbox “work” association and other instant means of communication over the years have tarnished Email’s image. That said, millions of people are still tied to their email as an official method of communication that can reach the most people because it has been around the longest.

Analytics is also a trend but in my opinion this has been the most consistent of all in the last 10 years. It is basically looking at and interpreting data from websites and advertising campaigns and making sense of them in a way to make positive changes in the media/ad choices and web content/development to better serve customer’s and the companies’ needs. I hope more analytics programs allow better/easier integration with all links/ads/impressions across the web because this is the key to understanding customers. There have not been many companies willing to get into this ginormous database product area over the years because it is so costly and complicated to get it right. The looming battle over cookies and privacy could change some of the validity of the data if it means that we lose 50% of the data on visitors. More disclosure is needed with consumers to get a better understanding of how these systems work in order to overcome this.

Display Advertising online is the unpopular element to talk about here but this type of ad had grown dramatically in the last decade. You may think back to old times when Gator or WeatherBug installed spyware on your computer from banners and wonder how it would grow. Well a lot has changed. Seriously. As soon as post impression conversion tracking was created we understood that people see and read banners even though they don’t usually click. Waiting for someone to click is pointless in banner advertising. If you track who views each ad (with a random ID number in a cookie) and then who converts and lands on the thank you for purchasing page that is all you need to know. In this space we’ve also seen advances in brhavioral targeting based on demographic data people share with networks (Like your Yahoo or Google profiles) and retargeting based on which sites you’ve visited in the past and may be interested in again. The end result is that Display advertising works, but only if you buy a lot of it. Like millions of impressions and you track from the impression through conversion and not just the click.

Some recent trends that have fizzled are:

Surveys/Customer sentiment measurement gauges. They’re more annoying than useful for the consumer, pretty much a waste of time even with some small incentive. Unless you pay someone $10-$20 they’re not going to care enough to tell you the truth. Nobody wants to say something negative that gets someone else’s job in trouble. If you pay attention to your feedback through customer service you will probably find out more useful information.

Feedback/Comments/Rating Systems. These are a good tool if you have an engaged customer base. I’ve seen some work well like Amazon and Nordstrom, but others like travel sites and restaurant ratings just get slurped into Google as content and your site doesn’t benefit from the functionality. People do trust ratings from customers (real people) more than ads or third party rating systems.

IM Instant Messenger. Some people still use IM as a method of chat, but it never became the hub for activity that we thought it would. AIM and Yahoo had it after ICQ and never really capitalized on it. GMail and Facebook added this as an additional functionality making the original IM programs kinda obsolete when people could do everything in one place.  Skype is the one standalone place this may live on. Skype’s claim to fame is video calls via internet and free voice over internet calls to anyone else online with Skype. Yahoo IM does this too but nobody really seems to use it there. Maybe they should have had that featured in their TV commercials.

Affiliate networks. These were all the rage in 2003-2004 and they have been a big reason for the prevalence of spam in blogs, social networks and search. Farming your online marketing out to people who are not responsible for the brand of your company and will do anything to make a buck is an invitation to get played. A lot of the payouts have dropped from these systems have been shut down or have less than 20% of the payout they once did for a conversion/lead. The message here, don’t trust anyone who says it’s “easy”. Some high level revenue sharing or lead trading relationships between large companies make sense but should always be handled in person by people not through 3rd party electronic networks.

Video may be a success for many people (including cats) but for most of us (and companies) it is still out of reach and vastly misunderstood. From a behavior standpoint, people can’t watch video/audio at work while at their desk because it is too noticeable that they’re not working (the largest audience base that the internet has) and the video content is not searchable because there is no transcription of the content automatically to make it searchable or translateable into different languages. Most people don’t know how to edit video and companies don’t want to pay thousands of dollars for this either. Editors may also have a tough job going through thousands of hours of content in the future to find the meaningful stuff. Professional content creators like TV/Movie studios still have the upperhand here in creating really good quality video and we may not have affordable tools and education for a while yet. Monetizing it is another problem and YouTube is an example of really popular sites not making enough money to really pay the bills since they rely on Google to subsidize them. I think Video may get easier if there are good online video editors (with good tutorials) that become available cheaply.

The Question & Answer format completed by volunteers/users of the site. Yahoo Answers is moderately successful from a search perspective but the general public never caught on and a lot of the answers were pretty bad. I never understood why companies never took advantage of answering questions as a way to create permanent links to their site for people looking for their products/solutions. Now Quora is trying to do the same thing somehow combined with Twitter. More companies seem to be embracing it but again the success of the site depends on the quality of the answers and without paying someone how good do you think it will be when the newness wears off?

Wikis. I wanted Wikis to be big. I am such a fan of Wikipedia and I also work in an industry where sharing content is a daily occurence. Wikis help when you need a reference material to be updateable quickly within a group. It served the encyclopedia niche really well and not many other companies needed something like this.

Now that I have rehashed the past and the present, where does that leave us on the footsteps of SXSW needing to understand what is next?  Some ideas I have may not be fully developed, but that is what the future is all about, speculating.

1. We need more databases, more user friendly-visually configurable-cheap-secure-web based databases. We have a lack of public knowledge about how to collect, maintain and report on multiple databases in marketing. This has only been for the IT and Web departments in the past, we need to free the data to become accessible to more people, although probably not everyone wants that. Some people may find that overwhelming and it does take experience to understand multiple layers of marketing and the effects it has on the data. We also need to find more user friendly ways to link separate database systems like analytics with accounting or orders and web ad servers. We need to resolve traffic flow/identity across all of them in order to understand things better, and we need more processing power to do this. It is also getting easier to collect data at so many points in everyone’s day on so many networks. We need ways to process all these potential new forms of data from wearable sensors to car/directional related sensors to all the video people post online that has no text for content. Basically we need to find better ways to process and understand all this data.

2. Mobile use is exploding but in my opinion very few web functions work well on phones due to the small screen and the variable network connectivity. Email works, Facebook also works. Twitter was made for phones. Advertising was not. How to monetize this channel is a challenge, as is how to reach new consumers in a relevant way while on these devices. One thing is clear, a mobile phone is with someone all the time, possibly even while they sleep, and people very loyal to their smartphones. The checkin-foursquare thing has caught on for some functions and some needs but it is not widely excepted. (more relevant to brick and mortar businesses offline) There is still frustration when full website functionality isn’t included in a mobile design and there is confusion between apps and mobile websites for consumers and marketers. This all may get resolved in time because of popularity. A Nielsen poll found that 41% of the respondents used their cell phone in the bathroom. We’re also not sure if tablet computers fit into this category or not yet. We will see more advertising opportunity on Mobile in the future but it should always be paired with regular Display & Search advertising (and offline) to make the connection.

3. Cloud computing, bye to VPNs and servers and hello to clouds. Also hello to more hacking, more data loss and more outsourcing of IT jobs to somewhere else. This can be a good technology to make your content/data/work available wherever you are.

4. QR codes, maybe? Eh? We get how to use them, not sure what the point is for the consumer? Coupons? Wireless rewards points systems? How do you get this data into your existing order and web analytics database systems?

5. Internet on TV and vice versa. The internet being an on demand database of content you can choose to watch at any time makes a programming schedule obsolete. Live events will have a certain lure but otherwise people will use Google TV, Apple TV, Netflix to access content while using the web in their living rooms all at the same time. Video chat will be better when its on your TV too. This will be very tricky for advertisers. In an on-demand world nobody will wait for a commercial anymore and it will have to be all subscription based. Companies will have to partner with content creators to get products seen, mentioned if there are no commercials.

6. Fragmentation. People may get tired of the constant need to reformulate their entire communication method with family/friends/work every two years and just pick something and stick with it at some point, but in the mean time we will have a lot of noise from a lot of signals all clamoring for a consumer’s attention and that means that they listen less to each of them. This makes marketers have to work harder to be louder and more frequent in their messaging and in turn makes consumers turn it off or change methods yet again. I find that to combat fragmentation you have to advertise on more mediums to be seen in more places. Billboards, Radio, Online & Mobile for example all at 4:30 pm advertising the evening news.

7. Task management - this is the factorization of web and white collar workers. Log into a closed system and a task list tells you what you have to do today and how long you have to do it. No critical thinking allowed without flexibility and more of a contractual-short term-task relationship with highly skilled workers. This could mean people work from home from anywhere, but forget the benefits of collaboration or connection with your job. It may improve productivity to a point, but at some point it is hard to motivate someone to do something as fast as possible when they’re not personally invested in the business (or getting rewarded that way) and working remotely.

8. Digital Archives - People are not able to really keep tabs on all the digital information in their lives. I feel this with digital photos. If Flickr didn’t exist with all my photos tagged and dated I wouldn’t be able to find anything with image names like DCIM21531 and file folders of random events on my computer that aren’t backed up. (ok that isn’t true, my tech husband just started an automated backup on an external drive he put away in a safe place, but until now it had never happened before). What about medical records for someone’s entire life history? What about family history? Emails, correspondence, daily diary blogs and other forms of electronic data? My brain can’t really remember everything and creating an archive to refer back to is an appealing idea. I also feel like I need a secure place to subscribe to in order to save/manage all this content and I’d pay for it gladly. Especially f they sent me a backup version of it on a drive in the mail. It also would serve as an archive for people if someone passes away.

9. Content managers – they used to be called Editors and paid a lot more money. Now they get paid to know the content subject matter and be an expert and may be responsible for writing the content themselves.

The Negatives of Social Networking Media

All the world is a Buzz about Facebook & Twitter these days. It’s almost like MySpace circa 2007, Google circa 2003 or Microsoft circa 1998. I don’t doubt the success, innovation or long-term viability of these social networking sites but I have seen that there are flaws in the system that mean that things won’t be perfect with the business along the way and we’re in for a bumpy road. Basically my point is that for all these sites give us in entertainment, social connections and opportunity they also have some negatives that are almost the equal and opposite pendulum action.

1. Time Suck – all social networking sites are using your time that you used to devote to other things. Maybe in some cases this is actually a better use of your time (instead of TV) but in most cases its time spent that you used to use for researching new information for work projects,  time actually spent talking with people in person (family/friends) or time spent doing things that really need to be done at work or home. Once the brain gets trained that you can go socialize instead of work at those times of day it’s a habit extremely hard to break. For all of us procrastinators looking for instant gratification its a real problem keeping up with work and affects the overall productivity of companies and the country as a whole. Internet access is much more prevalent and has far more users during the business day than it does at night, so there’s the proof. Unless your job is trolling these sites for sales prospects by “connecting” and making “relationships” with your customers, its a waste of time to spend more than 15 min a day.

2. Privacy – Of all the details analyzed about consumer privacy online (on Facebook) in the last few weeks the most suprising thing I’ve seen is that people really don’t care about their information online. Sure, nobody is going to post a ss number or cc number on their profile (duh) but they don’t really seem to realize the power of logging all their social interactions in one database and selling access to retailers and cpg companies who have even larger databases of information to analyze and strategize with. Is it really as fun when most of your friends are companies selling you things all the time? Twitter already has morphed into the largest opt in direct marketing platform I’ve ever seen. If people keep using it at this rate it will surpass email. The other obvious issues come with the work life balance thing and when people friend work makes and think nobody will see them rant about work or post drunk pictures on a sick day, but then again I’ve heard that its just people naturally selecting themselves out of the working pool.

3. Logic – the other issues I’ve seen coming for a while have to do with how everything that is built from large databases online with lots of consumer data seems to not work properly. There is always some algorithm developed by a science tech guy based on some theoretical calculus and it doesn’t provide relevant results. Which brings me to a repeating theme of data right now: we don’t really know what to do with it yet. Nobody knows enough real info about their customers to target them. (who has a budget for that?) And the database people just like to say they improved things a statistically insignificant amount with an algorithm tweak. The marketing strategy/process should always start with offline real life information about people and products and then develop an algorithm to show you information in that way. I don’t know why it’s always done backwards but it will keep our results irrelevant and marketing dollars wasted for a long time to come.

Online Dating Sites

I am not really a fan of dating sites online because people really don’t represent themselves as who they really are online. I have met some people that way and they are always different than their profile says. I guess it’s an imbellishment thing. There are other ways though to meet people online. MySpace, Facebook and forums that allow you to see who people are through what they write over time can all be alternatives to the match.coms of the world. You can communicate over time and get to know someone in a way that isn’t fake. It’s easy to fake a profile it’s hard to fake a conversation or many conversations over time.

The new Martha Stewart Blog

It looks like Martha Stewart has really taken to blogging lately. First Martha got a MySpace page and updates it regularly. Then she got a Facebook page and is pretty into that too. Now Martha Stewart has a new standalone blog also which means that there are 3 blogs to update every week or few days. She seems to either have someone with her at all times to document what she does or she is pretty handy with a digital camera and a blogging platform. She seems to have pictures of all her weekends and trips and likes to hear from people about the new things she posts. I hope she reads the comments once in a while if someone else is posting all this for her. But all in all, blogging to the public in a conversational style is a good skill for CEO’s and executives to have. People want to know that these big deal people are real too and have real voices. They are more apt to think positively of them if they have a blog or site like this because it makes them more human and distracts people from the ugly things they have to do and say yes to in the name of profits. So will you be Martha’s MySpace or Facebook friend?

Facebook Apps and Social Networking

I am not a huge fan of Facebook, I am more a MySpace person because well, I am getting older and it seems more primitive and understandable to me. But today through one of those many many email newsletters i get I saw there was a graphing social networks conference coming up. I immediately thought, how many people are into social graphs that there can actually be a conference? Isn’t that the play of uber programmer geeks and UI specialists? It’s a very exclusive club that I can’t join because my UI experience is low and my programming experience is non-existent. But yet I am still curious, like many people are, about emerging internet things. We all wonder when visual search and semantic search will finally really happen. It’s like the holy grail of convergence, that like true convergence, may not actually happen.

But what I found out about this conference is it’s not about drawing webs of how many people you know on the internet and linking them by different colors in Venn diagrams about their shared tastes. It is about things like facebook apps and social network applications off of the networks too. It has all the technorati A lister dignitaries attending, which means like the old blogging conferences I used to attend (Syndicate anyone?) it probably is too cutting edge and these technologies won’t go mainstream or won’t make money or both. They will have a lot of very intelligent discussion but alas its more about convincing eachother of their superior sales pitch or their product’s whiz bang goodness, and not really going much farther than that.

Plus I just saw some disappointing results from Facebook on a personal note with some work that I have been doing. MySpace performs way better in the way we needed them to. But it’s always neat to get distracted from work and go play around with some neat new cool sites and think about their data and what they have to say about trends in the internet world. So here are some cool sites that are sponsoring the conference. I’d skip the conference and maybe not work with these companies just yet, but I would keep an eye on it all for a little while and see where it goes. It could be huge you know… (Hype!)

http://www.popfly.com/ I got an invite but because I don’t have developer API keys, I can’t do anything with it.

Topix.com I’m not a fan, but recently some of their local commenting pages have given me hope to local search and communities. Maybe it was a good buy?

http://www.sometrics.com/demo/ Coolio! But I have no idea what this is good for except popular facebook apps and what some limited demographics are for the users… (I say coolio when I mean cool, it’s left over from about 10 years ago, sorry)

http://www.socialmedia.com/ A smaller less popular version of a sometrics.

The others like Plaxo aren’t my faves, but hey they might be useful for you…Check them out and see what you think…I’m not hyping anything.