Media 2.0


Few days’ back I was startled by the news item which claimed that UK online ad spend overtakes mainstream TV. The same news was corroborated by another post which stated that spending on online advertising surpasses TV. The news was little disconcerting because it did not seem to match with my ground level experience.

So, I decided to probe a little deeper and unearthed more data on Internet ad spend. What I uncovered was more in line with what I perceive to be the real situation. These reports claimed that the Internet ad spend is less than 10% of total ad spend which is only a fraction of ad spend on TV.

How can both be true? Careful reading of all the reports resolved the mystery. The first set of reports …

“… counts the money companies spend on their own websites as part of their advertising budgets, because websites are ostensibly used for marketing”

Though I did not agree with this statement (marketing spend ≠ad spend) it still got me thinking. Is this a gimmick or is this an indicator of a fundamental shift in approach to advertising and marketing? After some frantic googling and introspection I concluded that indeed there is a shift and this shift has to be called Media 2.0!

I can hear you exclaim Oh No! Not another 2.0.

But what else can it be? This change is directly influenced by …

  • … proliferation of channels through which content and ad can be delivered
  • … the ability of more channels to support two way interaction
  • … consumers producing, editing, tagging and mashing-up content

These are typical characteristics of web 2.0. It has opened up new possibilities and thrown new challenges to the both marketers and consumers.

“Consumers elude advertising while smart media and technology types come up with ever more ways to reach them”

This is also leading to major realignment in the industry and I was able to identify four of them.

Marketers are getting more accurate information about who you are and they are getting equipped with technology to show ad specifically tailored for a person of your profile, which in marketers’ term is called micro segmentation.

Things do not stop there. Taking this concept to the limit Prof. Prahalad has talked about N=1 or targeting you as an individual. They want to tailor their products and services to meet your unique need, which may have some benefit. However, they also want to influence your buying decision in their favor, which can be irritating. This brings us to the first realignment that is taking place.

Realignment 1: The boundary between advertisement and sales is getting blurred

Conveying messages to a consumer, which is advertising, is overlapping with the process of interacting with the consumer in the decision making cycle, which is selling. Forrester has coined the term ubiquitous marketing describing this shift. According to Forrester, it is the art of connecting with consumers through emerging media . . . everywhere. This is how they describe the term. “Ubiquitous Marketing relevantly connects the brand to a consumer, both taking into account where she is physically and where she is in her decision-making process.”

From the perspective of the marketer, the whole process has been linked in a single chain. However, from the perspective of the media companies, everything has got fragmented. Single national broadcast is becoming region specific. People are using their PC to watch TV and they are using their TV to surf the web. Special media players are being provided to watch programs on the PC and programs are also available for download. Prevailing practice of producing content to be delivered through a specific channel is breaking down and that is the second realignment.

Realignment 2: Content is getting decoupled from the delivery mechanism

Traditional method of advertising could be divided into two forms. The original form was space based where ad and content was laid out within a fixed area like a page in the newspaper or magazine. This could also take the form of an outdoor hoarding. This form of advertising got extended into web page design where you would leave space for ad banners in your page.

The second form of advertisement was time based where ads got inserted into radio programs. Same idea got extended into TV. These forms of advertisement were very different from each other and did not have any overlap. However, today’s devices have blurred the distinction between the two forms. You have banners appearing along with the program in TV and you have video ad on a web page. You also have in-content ad in a TV program. Some advances in the display device like Microsoft Surface & Sphere and display techniques like Seadragon and Photosynth are opening up new possibilities. Moving pictures from the world of Harry Potter is becoming a reality and that is the third realignment.

Realignment 3: Time based advertising (TV & Radio) and Space based advertising (newspaper, magazine, outdoor hoarding & web page) have started overlapping

Along with the proliferation of display types there is proliferation of content created by consumers themselves. Some of these contents are about experience of using various products and services offered by different organizations. This includes book review written in Amazon, travel experience posted in TripAdvisor, product review of latest high-tech products and even video of experience of breaking open a brand new iPhone to show what is inside. I am sure, like me, you go through these postings before buying something.

As a result of this, it has become very difficult for organizations to hide bad products and service through ad blitz. The collective impact of these bits and pieces of information can be like a groundswell on the buying decision of consumers. Any unfair practice also gets quickly highlighted. This is the forth realignment.

Realignment 4: Collective intelligence of consumers have as much influence on branding as the marketing messages delivered by the organization

When you are a consumer, these realignments will give you more choice and more say in what you buy and use.

However, many of you will also be on the other side where you are connected to an organization offering these services. Most organizations will be impacted by this realignment, but the net impact on organizations involved in B2C business, advertising agencies and media companies especially TV broadcasters will be substantial.

These realignments will alter the relation between entities in the real world and inside the IT applications. It will force paradigm shift in thinking and how the organization functions. It will also require internal applications to change, the extent of change will depend on how much of the traditional assumptions are hard coded inside them. It can take significant amount of time, effort and investment.

“Can I afford it?” is not the right question to ask.

Biggest challenge is going to be the necessity to respond to the changing demand of the market. Not being able to do so may cripple the enterprise. Therefore the question to ask is …

“Can I afford not doing it?”

Comments
3 Responses to “Media 2.0”
  1. Thanigaivel says:

    Nice blog, came in wondering this would be a more techie blog as you head the TIC, but this made me to rethink my perception. Sure will be a regular visitor to this blog🙂.

  2. Eswaran says:

    Good writing. Media 2.0 sounds Oh No-ish as you mentioned but I am lost for any other word.
    The question now seems to boil down to is ‘Are site updates administrative expenses or ad expenses?’.
    Also I suspect the words suspect, prospect, customer and, ‘repeat customer’ themselves are undergoing change.

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