Welcome back, NetZero. The company that made a name for itself offering low-cost (or “value-priced”) home Internet services that were heavily reliant on phone-line dial-up returns to marketing with a new array of products and services -- going after infrequent mobile Internet users, who may only occasionally access the Internet in public areas but either don’t trust or can’t access other public WiFi spots. NetZero President Rusty Taragan spoke with Marketing Daily about venturing into a new area and marketing to a newer, urban target customer. Q: Why branch into this area?A: NetZero, since its founding in 1997, has always prided itself on bringing the Internet to the masses through value-priced Internet access. We have been looking for many years for the entry into the mobile space. After spending time looking at it, we found a terrific partner in Clearwire that allows us to do what we do best, which is to put out a product that’s more consumer-focused and allows customers to pick a plan that suits their data needs.We’re not forcing people to sign up for two years or have plans that deliver much more data than they really need. And we’re able to expand the Internet to a much larger group of people who were not happy with the options they have today. Q: How does this follow through on the brand promise you have set out as the low-cost/no-cost Internet provider? A: Once again offering the consumer of picking apl an that meets their needs. We see a lot of people out there who want access to the Internet to get their e-mail when they’re away from home. Many of them use public WiFi hotspots. We know there are a lot of security issues at those places and that the more people that are utilizing the public WiFi, the slower it’s going to be. This allows people to have a very secure, very fast 4G Internet session. Q: The tiers are such that that no-cost plan is pretty limited. A: It is limited to someone who wants to get on the Internet once in a while and wants to check their e-mails. We’re not targeting this to the business consumer. We’re targeting this to the Internet user who will range from a very casual user to a fuller user, which is why we give people the option. Because there’s no contract, we allow people to come in and try a specific plan. If it turns out they need more data, they can top up for that month or try a different plan. And there’s no charge for changing plans. Once again, this just makes it a lot easier for the everyday consumer to try a service that in the past has been in many ways cost-prohibitive in terms of the commitments they’ve needed to make. Q: So you see the target as different. Where’s the opportunity with general consumers, as opposed to the business consumers. A: We know that there are probably 100 million people who are accessing through public WiFi hotspots. And we know the more this goes on, the more they slow down. In the past, people who have wanted access didn’t really have a choice but to use the unsecure hotspots. This gives people the opportunity to continue to access the Internet with the security without having to spend too much money. We’re not looking as a home replacement service -- but more of one that you’re going to take with you. Q: What challenges do you have in the marketing of introducing NetZero into this mobile Internet category? A: We have a name. But frankly, it was much bigger a few years ago than it was in the past couple years. So we’re reintroducing the name to the general public. We’re going to have a multimedia advertising campaign. We had advertisements in the Chicago Tribune, the New York Post and the LA Times. We have a multi-market TV ad campaign that begins Monday. We’ll be doing direct mail. And we’ll be doing Internet advertising, which can be targeted to people on public WiFi hotspots. Q: What are the challenges of not having been in the market for a while? Consumers may have already moved on or selected their WiFi carriers. A: Most of the people we’re going after haven’t selected [those carriers]. We estimate fewer than 10 million people have mobile WiFi contracts today. They are primarily people who are willing to have a two-year commitment, and have $50 or $60 to spend a month. They’re businessmen and women. Our target is different. When you see our commercials, you’ll see what we’re trying to do is explain to people that at a very low cost we can help you get on the Internet mobile, and much more securely. You’re not tethered to the coffee shop. You’re not concerned about the security; you’re not concerned about the lower speeds. We’ve got a little bit of an education process, and that’s what you’ll see in our ads. Q: How, if at all, are you targeting your current subscriber base?A: We began an intensive campaign with the 800,000 subscribers that we currently have; educating them as to what we can offer. There’s some overlap of the two. NetZero[’s home service] is more of a less urban, more rural market. This service is more skewed to the cities. It’s an evolution of the brand. That’s why we’re not set just going after the NetZero members. That’s why we had ads in the NY Post and Chicago Tribune. If you tune into the “American Idol” this week in New York, you’re going to see an ad that reintroduces NetZero to the world and introduces this new service to them. Q: In terms of reaching that new group, did you have to reevaluate the way you looked at customer segmentation?A: It certainly is a different segmentation than we have for our dial-up service. We looked very closely at who has the capability of utilizing this service, who is buying this service -- who is using public WiFi today. We looked at people who currently have mobile broadband service, those who are using public hotspots and those who have iPads or laptops who aren’t taking them out of the home. It’s a very broad audience. It’s growing enormously, and we think we can tap into that growth. We’re trying to bring mobility to the masses. We’re going with the NetZero DNA of value-priced Internet access that’s customer-friendly -- that gives people the opportunity to try this without having to tie into a long-term contract. We’re convinced if you try it, you’re going to like it -- and you’re going to keep it.
The love affair between teens and texting is deeper than ever. New findings from the Pew Research Center’s Internet & American Life Project show that 63% of U.S. teens were text-messaging daily as of July 2011, up from 54% in September 2009. The volume of texting has also grown, from 50 to 60 messages for the typical teen during that period. Much of that increase has come as a result of older teens (14-17) ramping up from a median of 60 texts in 2009 to 100 last year. Boys of all ages also increased texting volume from a median of 30 texts daily in 2009 to 50 in 2011. Black teens showed a similar increase, from 60 messages per day to 80 in the last two years. Older girls remained the top texters, however, with a stream of 100 messages a day in 2011, compared to half as many for boys of the same age. The daily exchange of texts among almost two-thirds of teens far surpasses other types of daily communication including calling by cell phone (39%), face-to-face socializing outside of school (35%), social network messaging (29%), instant messaging (22%), talking via landline (19%) and emailing (6%). The growing popularity of texting is eating further into phone conversations overall. Fourteen percent of teens talk daily on landlines, down from 30% in 2009, and almost a third (31%) of teens say they never talk on a traditional phone line with friends. Only 26% talk daily with friends on cell phones, down from 38%. The heaviest texters are also the heaviest talkers, however. Some 69% of heavy texters (exchanging more than 100 texts a day) talk daily on their cell phones, compared with 46% of medium texters (21-100 texts a day) and 43% of light texters (0-20 texts a day). That can’t be welcome news for parents who are footing the family wireless bill. The Pew report also showed that about one in four (23%) of teens have a smartphone. There are no differences in ownership of smartphones compared to regular cell phones by race, ethnicity, or income. Teens whose parents are college-educated are slightly more likely than teens with less educated parents to have a smartphone (26% versus 19%). More than three-quarters (77%) of all teens own a cell phone, about the same as in 2009. When it comes to tablets, about 16% of teens used the devices to go online in the last 30 days. Some 30% of smartphone users have used tablets in the past month, while 13% of regular phone users and 9% of those without cell phones have done the same. The study found that only a small proportion (6%) of teens is using location-based services on cell phones. In that vein, 18% of smartphone users shared their location compared with 8% of regular phone owners and 2% of all other teens. Older teens, at 9%, are most likely to use location services like Foursquare. The research results were based on phone interviews with a nationally representative sample of 799 teens ages 12 to 17 and their parents conducted in English and Spanish by Princeton Data Source from April 19 to July 14, 2011. The margin of error for the weighted data is plus or minus 4.8 percentage points.
One of the nation’s largest coupon publishers, News America Marketing, has created a free iPad app for couponing called SmartSource Xpress. The iPad app is a digital extension of the print brand, SmartSource Magazine, a Sunday coupon insert reaching 74 million homes in the U.S. every week, and its associated Web site, SmartSource.com. The SmartSource Xpress app allows consumers to find and digitally “clip” coupons for savings on household brands and products including Campbell Soup, Colgate-Palmolive, Comet, Energizer, Kraft Foods, and Rubbermaid, among others. Once coupons are selected, they are digitally transferred to the consumer’s registered shopper card, for automatic redemption at the checkout. The coupons can be redeemed via shopper club cards at 4,000 retailers around the country -- a number which SmartSource expects to increase over the next year. Inmar, which tracks the promotions and coupons industry, calculates that digital coupon “inserts” have grown 46% over the last two years, compared to 34% growth for comparable print products. Amid continuing economic woes, digital coupons have been adopted by a growing number of American consumers, with the number of online U.S. consumers that use digital coupons set to grow from 88.2 million in 2011 to 92.5 million in 2012 and 96.8 million in 2013, according to Nielsen Homescan. According to separate figures from Valassis, CPG marketers distributed a record 305 billion coupons in 2011. However, only 1% of these were distributed in digital format, and 89% were distributed in print freestanding inserts.
In a blow to Jiffy Lube franchisee Heartland Automotive Services, a federal judge has given the go-ahead to a lawsuit accusing the company of spamming customers with text ads for discounts. U.S. District Court Judge Jeffrey Miller in the Southern District of California rejected Heartland's argument that the Telephone Consumer Protection Act, which requires companies to obtain users' express consent before sending them text ads, unconstitutionally restricts free speech. Miller also disagreed with Heartland's Jiffy Lube's stance that it couldn't be held responsible for the ads because it had tapped an outside company, TextMarks, to manage the campaign. "Heartland should not be allowed to avoid TCPA liability merely because it hired a different firm to send advertisements to its customers," Miller wrote in a ruling denying Heartland's motion to dismiss the lawsuit. The case dates to last year, when several consumers filed a potential class-action against Heartland and TextMarks for allegedly sending unsolicited text messages advertising a "1 time offer" for 45% off an oil change. The consumers argued that the ads violate the TCPA, which prohibits companies from using so-called automatic telephone dialing systems to make calls to cell phones unless the owners have consented. Other judges have said the law applies when companies use devices capable of generating phone numbers to send text messages without users' permission. The law provides for damages starting at $500 per violation. Heartland argued that the TCPA is unconstitutional because many common devices, including smartphones and computers, have automated dialing systems. Therefore, Heartland said, the law would infringe on free speech principles by preventing consumers from using iPhones or BlackBerrys to send texts without the recipients' consent. "Heartland posits that a person could be held liable under the TCPA if she were to send a dinner invitation to a friend of a friend using a machine that has the capacity to randomly or sequentially generate telephone numbers," Miller wrote. But the judge rejected that argument as too farfetched. "The court cannot conclude that use of personal electronic devices in the situations posed by Heartland would be restricted by the TCPA," he wrote. The ruling shows that SMS campaigns can prove dangerous for marketers, Internet legal expert Venkat Balasubramani says in a blog post. "The big takeaway from the order is that text message-based marketing is something that companies often screw up, and these screw-ups end up being costly," he writes. "Rulings like these make me think companies should consider avoiding text message-based marketing altogether."
Search contributes 18% across all brand categories, and a brand's Web site adds 16%. Companies want to get cozy with consumers, but marketers need to pay closer attention to where they should have that conversation, according to a study released Monday at OMMA Global in San Francisco. The Digital Platform Engagement Index looks at how digital changes branding for companies. It becomes less important to analyze the audience demographics and learn more about how the 14 digital platforms intersect in their product and service categories. Findings suggest age is less important than knowing where consumers engage with the brand for specific information. Brands need to look at how consumers view the brand, according to Robert Passikoff, Brand Keys president. Some platforms attract a specific type of demographic or audience segment. Marketers that want to talk about family-friendly topics with consumers who spend a lot of time online might want to do it on social networks, he said. Brands can accomplish that, Brand Keys suggests, by overlaying information about digital platforms like blogs, social, search and mobile marketing with four key drivers and their specific values, Passikoff said. "It's more important to find where specific messages resonate across digital platforms," he said. "By knowing this you can use the category drivers and determine the message." It's no longer a question of whether a brand should be on Facebook, but what message resonates best there. Social networks and blogs seem to have the greatest overall influence on consumers. Consumers who spend a lot of time online and want information on product safety, for example, will typically find and read it on a blog, rather than a message about product safety, strong relief, or whether the product is family-friendly. The general population might see it differently. Brands might find that the "doctor recommended" message makes a much smaller impact when disseminated on blogs, compared with talking about safety in another way. When it comes to search engine marketing, of the 83 categories included in the 2012 Brand Keys Customer Loyalty Engagement Index, the categories exhibiting the greatest levels of brand engagement for the digital search include upscale hotels, office supply stores, flat screen TVs, discount retail stores, and athletic footwear.
Longtime marketing industry analyst Brian Wieser says entrenched entities throughout the TV ecosystem “have nothing to worry about” regarding new gambles to create Web-based programming options, such as the Barry Diller-fronted Aereo and an Intel would-be over-the-top service. A principal reason: consumers want content flowing easy. The Pivotal Research Group analyst writes in a report that more affordable services are “preferable,” but only on paper to a degree because “the vast majority of consumers don’t want to think about how they access video: they just want it to work.” If new ventures want to widely supplant incumbent services -- i.e., turning on the TV via a remote control -- it will be “necessary to offer up a service involving as little change as possible from the existing model,” Wieser writes. With all the on-demand options consumers have on new platforms, putting them in control, Wieser says “they don’t seem to want to exercise it very much. The primary reason? TV is mostly an ambient experience.” He notes that the would-be disruptive opportunities, such as the DVR or Web streaming, have increased “marginally” when compared with traditional TV viewing. “While laptops and iPads are certainly pervasive in a large minority of homes, the nature of the devices (let alone their limited batteries) mean that consumption of video on these platforms is generally limited to ‘active’ viewing,” Wieser writes. “Very few consumers will ever consume all of their TV in this active manner, and any new service will be hard-pressed to replace old ones in the near-term for much of the population.” He suggests that Aereo and Intel’s prospects are likely to go beyond “niche audiences.”
“Honey, why are we watching this in low-def?” This is the persistent lament in my house when I walk into the living room and see what to my eyes is the mortal sin of running standard-definition TV channels on 60 inches of Sony 1080i sharpness. Just as I have shown my wife repeatedly how to juggle the five remotes in order to run a DVD (“I will never be able to watch a movie on my own again, will I?” she says), I need to show her every evening how easy it is to pop from the familiar low-end channel numbers she has known for years on her old cable box to the HD versions on the upper end of the 999-channel guide. “Huh? How can you tell it isn’t high-def?” she asks -- but I am pretty sure she is just screwing with me. I figured it was better not to try to show her the difference between the iPad of old and the new one I have been playing with all weekend. Why set myself up for frustration? But truth be told, I am starting to wonder if a lot of reviewers simply have younger, sharper eyes than I do. Or if the taste for Apple-branded Kool-Aid has become too delectable for gadget reporters needing something over which to gush. To be sure, the doubling of resolution on the new iPad is welcome and fun. Running Infinity Blade II or iBooks will show you pretty much what the on stage demos suggested -- great graphics, pin-sharp, richly colored. Text feels more focused in iBooks and The New York Times app. I am still struggling to find instances where I find the promise of enhanced color saturation all that evident. But honestly, high resolution is hardly revelatory at this point in media. And the bump here is visible but not game-changing. The touch interface and nicely detailed iPad display always had us at hello, anyway. We were already in love. This is a nice makeover that gets us to the point where text rendering feels more print-like -- where the games edge closer to console quality. Don’t get me wrong. All of this is good. I rented a film in iTunes that was incredibly sharp. At these resolution levels and with the shadow detail the display renders, the film image has that dimensional pop of HDTV. But the iPad has been so close to this point all along that this new model really is iterative. And at some point, just basic decorum dictates that we need to stop following the magician’s lead and not look and gasp where The Amazing Apple-ini wants us to look. How many of us caught ourselves staring back and forth between an upgraded icon and an old fuzzy one to detect the difference? Oh, how did we ever live in an unfocused world? LTE speed is also welcome, but probably premature for most consumers at this point. In the three years I owned the original iPad, my use cases rarely made me miss embedded cellular. Even when I had a 3G model, its availability never liberated me to use the device in a wider variety of places. The burden of an additional data plan, even on a month-to-month basis, pretty much dissuaded me from expecting ubiquitous connectivity from my iPad. After all, I still had an iPhone that was always connected and had many of the same apps. Which is not to say that we will not get to the point where always-connected tablets are presumed. But in my mind the major impediments now are the carrier data plans themselves. Until users can buy into pools of data that can be shared among all their remote devices, I suspect most of us simply will reserve tablet use for WiFi zones. The geeky gushing over the Retina Display reminds me a bit of the final stages of hardware wars on the PC platform. I remember reviewing tons of 3D graphics cards back in the day that dazzled with their ability to render super-detailed game and CAD programs at astonishing resolutions on the desktop. Remember framerate counts and CPU clock rates? That is when upgrading your PC every few years really meant something. The difference was palpable and glorious. You really could do more, faster. At some point in the mid-2000s, however, diminishing returns set in. The hardware increases simply were too incremental to see or feel anymore, expect for the geeky hardcore who still ran benchmarks. Remember benchmarks? I think Apple itself already knows all too well that the hardware race maxes out at some point soon. Thus, we see them focus wisely on things like iCloud, integration of operations across devices, interface, etc. When it comes to mobile hardware, we have many generations of dazzle still ahead of us, and some hardware advances that really will change the game. At some point we will see transparent tablet devices that will make augmented reality a mind-blowing way of interfacing with the world. On-board projectors will turn the tablet or cell phone into a device that allows you to share any video or image on a wall and lets you use any flat surface as a virtual keyboard. And there are countless kinds of sensors -- not the least of which is NFC, that will redefine devices. Doubling the pixels and adding connectivity I can’t afford? Okay, fine. Good to have. Let’s not mistake these model tweaks for the stuff that really helps us think differently. The new iPad moves the ball forward in all the ways the platform already has -- console-like gaming, portable HDTV, content you seem to fall into.
The number of online video ads viewed by Web consumers doubled year over year. In February, Americans saw 7.5 billion video ads, according to comScore’s just-released February online video figures. That’s up from 3.8 billion total video ads a year ago. And while there are variations in the number of ads delivered month by month – 5.6 billion ads delivered in January; 7.1 billion served in December, for instance – the overall trend is positive. However, the number of overall videos seen online has remained fairly steady over the last several months. Despite the million of views that Super Bowl ads garnered online, overall online viewing dipped slightly in February compared to the prior two months. About 179 million Web users checked out nearly 38 billion online videos in February. That’s a slight dip fromJanuary’s figures, which saw 181 million Web users watching nearly 40 billion videos. Back in December, about 182 million Internet users viewed 43.5 billion videos. Compare those figures to just four months ago. In October, comScore reported that 184 million Web users saw 42.6 billion videos, a record then. (comScore reported views different on a year-ago basis, making year-over-year comparisons more complicated.) So is this the moment when we freak out and say why aren’t views growing? Hardly. These are normal fluctuations — after all, October’s all-time high was bested just two months later in December with about one billion more videos viewed that month. Online video viewing appears on a steady pace. Small variations month by month are normal and what these numbers seem to suggest is that we shouldn’t look for big swings or big upticks in views. The only issue is whether consumers will continue to tolerate the greater dosage of ads.