Advertising executives -– both marketers and their agency representatives -– continue to increase their optimism toward digital media options, and are beginning to swing toward it as more of a “branding” than a performance “option,” but there are some significant disconnects between the way they look at various digital media silos. While agency executives tend to be far more bullish on the overall use of digital media, marketers are much more optimistic about budgeting for social media. The findings, which are part of new, detailed analysis coming out of Advertiser Perceptions’ Fall 2011 survey on ad executive attitudes and optimism about media, show the overall index for digital -– including online display, search and video advertising –- trending upward, but the sentiment appears to be driven primarily by agencies. That insight is interesting, because the bottom line of big agencies appears to be benefitting from their continuing shift toward a greater reliance on digital media, according to a Pivotal Research analysis released Monday (OMD, March 13). “But there is a discrepancy in the way marketers and agencies are seeing it,” says Randy Cohen, a partner in AP -- which produces an ongoing series of ad industry tracking studies under its Advertiser Intelligence Reports banner, including this one. “It’s a disconnect,” he says, adding, “But agencies tend to do what marketers want them to.” If that’s the case, social media should be the primary beneficiary, according to Cohen, because marketer sentiment is building much more favorably toward social networks versus the rest of the digital mix. “The mindset is that they’re going to turn into a big share of the digital pie going to social in the next few months,” says Cohen, citing data suggesting that “social media rules the day in mindshare.” In fact, the data shows that Facebook continues to build in overall ad industry “buying intentions,” and currently ranks nearly twice as strong as the next-biggest media options. Interestingly, the Google Display Network, and Google’s AdWords/Display platform, have shifted into the No. 2 and No 3 spots among ad executive buying intentions for this year, supplanting once-dominant Yahoo’s display ad platform, and previous third-place ranker YouTube. The shift toward social also represents a bit of a paradox, says Cohen, because most ad executives still rank it mostly as a “performance” medium versus a “brand-focused medium,” with indexes of 137 and 69, respectively, against those two criteria. Cohen says that’s a paradox, because the overall sentiment toward digital media is that it is shifting more into a brand-focused advertising option. He says AP’s most recent data shows those two criteria to be almost even, with 49% of the respondents citing “brand” versus 51% citing “performance” as the main criteria for buying digital media over the next 12 months. That’s good news for the online industry, which has been trying to overcome its performance roots in hopes of attracting bigger brand dollars. Cohen says the fact that marketers are so keen on social, and that they still see it primarily as a performance medium, indicates how much “confusion” there currently is in the digital advertising marketplace. He attributes that to the fact that options that might be perceived as being more brand-focused, like online video and display advertising networks, and the major portals are not seen as “the new shiny thing” that Facebook and other social media platforms currently are in the minds of marketers. One thing that does bode well for online video advertising networks heading into this year’s upfront advertising marketplace is that it is currently trending stronger than any other digital ad option except for mobile, which is still nascent. On the downside, agency executives are much more optimistic about online video’s prospects than their clients are. According to AP’s data, there currently is a 14-point index gap between the two on their plans to buy online video over the next 12 months: a 58 for agencies, and a 44 for marketers. Moreover, while agencies gained two index points, marketers dropped two points from AP’s Spring 2011 survey. Overall Buying Intentions Fall 2010/Index Spring 2011/Index Fall 2011/Index 1 Facebook 2092 Facebook 2191 Facebook 2072 2 Yahoo Display 1392 Yahoo Display 923 Google Display 1347 3 YouTube 777 YouTube 909 Google AdWords* 953 4 Twitter 753 AOL 826 Yahoo Display 911 5 Google Display 678 Google Display 791 AOL 866 Top 25 Average 482 Top 25 Average 503 Top 25 Average 533 Source: Advertiser Perceptions. A 100 index equals the average of all digital media brands. *Google AdWords Display Network.
Microsoft has updated its privacy policy to specify that it serves health-related ads to users based on their Web activity, including whether they have visited sites with information about conditions like diabetes, cholesterol or osteoporosis. "Microsoft personalizes ads on many different segments, including those that are health-related," the company says on a new page about health-related targeting. Microsoft adds that the health-related segments it currently uses include "allergy researchers," "cholesterol researchers" and "diabetes researchers." A Microsoft spokesperson said the company added that information to its privacy policy on Feb. 28 in order to comply with a new health transparency policy of the self-regulatory group Network Advertising Initiative. The NAI last year said it would require members to disclose behavioral-advertising segments based on any activity related to health or medical issues. The organization intends to start enforcing that policy this year, says executive director Marc Groman. Microsoft might be the latest company to disclose that it allows behavioral targeting based on health information, but it's hardly the only one to do so. Yahoo discloses on its Web site that it allows companies to target users based on categories including hypertension, blood sugar management and arthritis. AOL also reveals on its site that standard categories include asthma, blood pressure and infections. In yet another example, AudienceScience revised its privacy policy last August to specify that it "may use health related segments, such as Cholesterol and Dental, Oral Care." But privacy advocates have long argued that transparency isn't enough when it comes to targeting people based on medical issues. Instead, that type of targeting should require users' explicit consent, advocates say. "If people start seeing online ads from third-party ad networks targeted to medical 'research,' they may be deterred from similar research in the future, which would be a terrible result," says Justin Brookman, director for consumer privacy at the digital rights group Center for Democracy & Technology. Self-regulatory principles of both the NAI and the Digital Advertising Alliance generally allow companies to target Web users based on health information on an opt-out basis, although the groups say that opt-in consent should be required in some situations. The DAA's principles call for opt-in consent before collecting "pharmaceutical prescriptions or medical records related to a specific individual.” The NAI says that opt-in consent is required for health-related targeting based on "precise information about past, present, or potential future health or medical conditions or treatments, including genetic, genomic and family medical history." But ad networks have a lot of leeway in deciding how to interpret that principle. "Other than to make clear to members that some health conditions, such as cancer, mental health-related conditions, and sexual health-related conditions, are 'precise' conditions that would require opt-in consent, the NAI has not developed an extensive blacklist of every condition that it considers to be 'precise,'" Groman says. He adds that the group's new policy, which requires members to disclose that they engage in health-related targeting, will help the NAI determine whether they are targeting people based on sensitive data. "NAI staff looks not only at the name of the segment, but at the nature of the condition to which the segment relates, including, among other things, the seriousness of the condition, its prevalence, whether the condition is something that an average user would consider to be embarrassing, whether it is treated by OTC or prescription medications, and whether the condition can be treated by modifications in lifestyle as opposed to medical intervention." Groman says that the NAI intends to explore the issue this year as part of comprehensive code revisions. "Unlike more concrete examples of sensitive data, such as a Social Security number or financial account number, this category inherently has shades of grey."
True Knowledge, the father of personal search assistant Evi, which performs many of the same functions as Apple's Siri, plans to release a series of application programming interfaces (APIs) that allow product developers to build in voice-activated features in television products, cars and more. William Tunstall-Pedoe, the company's founder, believes Evi and products like this, such as Apple's Siri, will replace manual tasks people typically do now with apps. Through APIs, the technology will potentially become a channel for voice-activated systems in cars or homes. "She's out there in the cloud," he said. "The Android and Apple apps are two channels to talk with her, but we expect there will be other channels like a TV in the house and car. Evi becomes a computer system, and the apps are ways to talk with her." Ask Evi her age, and she'll tell you she's one month and 25 days old. The data changes daily. While some of the content comes from crawling the Web, more gets stored in a database that Tunstall-Pedoe refers to as her "head." Sometimes she consults the knowledge in her "brain" and combines it with information across the Web to give users more options, he said. Unlike Siri, the first version of Evi cannot send a text message, but the company says it does a better job of handling dialects and looking up British businesses and maps. Tunstall-Pedoe said the Cambridge, U.K. company plans to release the feature soon in the next version. An Android update will likely come first, he said, hedging a bit when asked whether the recent "situation" with Apple contributed to the decision. Tunstall-Pedoe said reports that Apple had threatened to remove the app from the store were accurate, but the two companies are working through their differences. "We're in the process of getting an update out," he said. Personal assistants like Evi and Siri are expected to alter retail behavior. Catapult Marketing conducted a study that eMarketer suggests will change the way consumers shop -- with 39% looking for coupons or deals, and 35% comparing prices on the shelf. Evi uses the same speech recognition system as Siri, but True Knowledge's core semantic technology begins where speech recognition leaves off. The company licenses technology that turns speech into text, which recognizes content across the Web. Tech hurdles included understanding natural language and inferences, and calculating the knowledge and words in such a way that computers can understand meaning. Tunstall-Pedoe said the product road map includes advertising and the ability to serve content based on location. A voice search on a specific subject, location or preference enables the opportunity to insert information into the conversation, such as, you're hungry and standing next to a restaurant offering a 30% off deal. The technology opens the potential for more sophisticated matching services that marketers require. Evi knows a lot about the user and location, so the app could potentially link questions and users with marketing content. For local searches, such as find cafes near me, the technology can rely on a call to an API or other services like Yelp. Aside from Siri in the past year, voice-activated apps have begun to emerge on the market. Take Dragon Go for the iPhone, iPod Touch and Android, for example. The app eliminates a sea of blue links common in traditional search apps. The search pulls in content from Ask.com, Dictionary.com, ESPN, Fandango, Google+, iTunes, LiveNation, OpenTable, Pandora, Spotify, Twitter, Wolfram Alpha, Yelp, YouTube, and others. Asking a mobile phone for information through a voice command, similar to the way one person asks another a question, creates a personal connection between human and machine; it could also transform mobile search.
Doing their part to fuel Facebook’s ad revenue, 39% of Facebook merchants report using Facebook Ads, according to new research from ecommerce platform Payvment. “While a handful of large retailers have put their F-commerce efforts on hold, there are hundreds of thousands of small businesses that are successfully selling products on Facebook,” said Christian Taylor, founder and CEO of Payvment. Along with general Facebook marketing tactics, such as promotions and deals posted to their brand walls, nearly 70% of merchants say they plan to use Facebook Ads again, Payvment found. Along with Facebook Ads, the data also showed that small sellers are using a wide variety of outside marketing channels to drive traffic to their Facebook storefronts, including Twitter, Google ads and email marketing. Across the board, sellers cited effectiveness in fan and customer acquisition as their top reason -- 68% -- for planning more Facebook Ad campaigns. Other reasons for continuing to use Facebook Ad programs included the ability to start and stop campaigns -- 60% -- Facebook’s targeting capabilities -- 60% -- and Facebook Ads’ ease of use -- 55%. Yet, as Payvment finds, not all Facebook sellers have had success acquiring new fans and customers with Facebook Ads. Among some 30% of respondents who said they wouldn’t use Facebook Ads again, 68% reported that they did not acquire many new fans or customers through this channel. Lower-than-anticipated results may have been due to confusion about how to effectively use Facebook Ads, Payvment suggests, as one-quarter of respondents who hadn’t tried Facebook Ads said they didn’t understand how to use them. Cost was also cited as another reason for not using Facebook Ads again. In total, 65% said they wouldn’t continue using Facebook Ads because they are too expensive. That said, among those merchants not currently advertising on Facebook, only 32% say that Facebook Ads are too expensive to use, while the majority -- 63% -- cited a lack of budget as their primary deterrent. According to Facebook, 88% of Internet Retailer's top 200 retail sites are integrated with the social network for good reason. A recent study from social tech provider Sociable Labs noted that a full 50% of visitors to ecommerce sites are concurrently logged into Facebook. For its study, Payvment said it surveyed over 100,000 sellers on Facebook, the majority of which are small businesses with less than 500 Facebook fans.
Looking to bridge the business of DVD movie ownership to digital movies, Walmart is starting up a disc-to-digital cloud service in a deal with the five major movie studios. Using its digital video platform Vudu, where consumers can currently buy or rent movies and TV shows, Wal-Mart has struck a deal with the five major movie studios' home entertainment divisions: Sony Pictures, 20th Century Fox, Warner Bros., Universal and Paramount. The essence of the service will allow consumers to bring their movies on DVDs into Wal-Mart stores and have them converted into a digital cloud service accessed by Vudu. In addition, standard-definition movies can be upgraded to HD films. Prices for a standard-definition or Blu-ray conversion of a disc into one's personal cloud service will be $2 for a single DVD, Converting one SD disc to access in a HD cloud service is $5, and converting one HD DVD movie into cloud HD service of that movie is $2. "This will give consumers confidence in buying physical DVDs," says John Aden, executive vice president of general merchandising for Walmart U.S, speaking at a press conference in Hollywood on Tuesday. "They can future proof their purchases." By some estimates, Walmart sells more movies to consumers than any other company in the world. Walmart would not elaborate about marketing support, but Ron Sanders, president of Warner Bros. Home Entertainment, says the advertising support would be akin to a "blockbuster movie launch." Estimates are that movie studios can spend $50 million to $100 million when it comes to marketing support of an individual big summer movie. Movie executives believe this alliance will help their suffering home entertainment business and stem the slide of DVD sales and rentals. It should also push one of their bigger efforts, Ultraviolet, where consumers can buy a DVD and have access to a digital version of that movie through other digital platforms -- which some analysts consider cumbersome. "This is big step for Ultraviolet," says Dennis McGuire, president of Paramount Worldwide Home Entertainment. "This makes it ready for a mass audience. It [has not been] a simple message to the consumers. With Walmart, this will help; this will be simple." The service will begin April 16 in some 3,500 U.S. Walmart stores.
Even before the release of the new iPad, Apple’s iOS managed to surge further ahead of Android as the top platform on at least one mobile ad network in February. New data from InMobi shows iOS’ share of ad impressions increased from 28.1% in November to 35.2% last month, while Android slipped from 34.5% to 30.9%. The Google platform also dropped from a 32.7% share in January, while iOS held at the same level from the prior month. The figures reflect market share on InMobi’s ad network covering North America, reaching a mobile audience of about 57 million. The company attributed iOS' expansion, in part, to growing tablet adoption, which disproportionately benefits Apple, since the iPad is easily the bestselling device in the category. The company sold a record 15 million iPads in the last quarter of 2011. Apple overall had the top three devices on the InMobi network in February, with the iPhone 4 accounting for 10.9% of impressions, the iPod, 6% and the first-generation iPad just behind, at 5.7%. The ad network expects the release of the third-generation iPad on Friday, along with the price reduction of the iPad 2 from $499 to $399, to further propel iOS’ growth. Pre-orders of the upgraded iPad have already sold out. The latest version features a faster processor, a sharper display, and 4G wireless capability. Gartner estimates iPad sales will increase from 47 million to 69 million this year and that overall tablet sales will grow from 63.6 million to 103.5 million worldwide. A new survey from ChangeWave Research suggests the iPad will also get a boost from the corporate market in 2012. It found more than one in five companies plan to buy tablets for their employees in the second quarter, and 84% say they’ll buy iPads. Android is also likely to broaden its tablet presence through sales of Amazon’s Kindle Fire, which runs a version of the Google platform and has quickly established itself as the No. 2 contender behind the iPad. When it comes to handsets, Android is now the dominant player, used by nearly half (48.6%) of U.S. smartphone subscribers, compared to 29.5% for the iPhone in January, according to comScore. That difference is reflected in recent data from Millennial Media, showing that Android accounted for 47% of impressions on the ad network versus 33% for iOS. Millennial’s network reaches about 100 million unique users in the U.S. -- almost double the reach of InMobi’s. Research in Motion’s BlackBerry OS is losing ground to iOS and Android on both ad networks. It had a 13.1% share of impressions on the InMobi network in February, down from 17.2% in November. RIM’s failure to crack the tablet market with its PlayBook device launched last year hasn’t helped offset its shrinking share in the smartphone market. InMobi said impressions on its network overall have grown 58% in the last three months.
Former Yahoo and Bloomberg executive Kevin Krim has joined CNBC.com in the newly created position of digital general manager. In that role, he will be tasked with developing and executing “a cohesive digital strategy that will take CNBC to the next level,” per Mark Hoffman, president of the financial network. Until last September, Krim was global head of Bloomberg Digital, overseeing Bloomberg.com and BusinessWeek.com, as well as the integration of the company's TV, radio and news content into new digital products and services. Before joining Bloomberg in 2009, Krim was vice president of product and strategy for Yahoo HotJobs and Yahoo Small Business. Starting today, Hoffman said CNBC.com, under the direction of Meredith Stark, and its digital products group (CNBC PRO, Mobile and iTV teams) will report directly to Krim. Lou Tosto, senior vice president, CNBC digital sales, will be a dotted-line report to Krim and work closely with him on digital revenue strategy. CNBC will finalize how key digital functions align with the new management structure in the coming weeks. Scott Drake will continue to lead CNBC’s technology organization and report to Hoffman. The CNBC president said in the announcement that CNBC.com has experienced strong traffic growth, but according to comScore, the site drew about 6 million unique visitors in February, down from 6.8 million in the year-earlier period.
Jelli, which allows listeners to choose broadcast radio airplay via an online platform, has unveiled an Android app for its “social radio” service. The Jelli Android app is the latest in a series of moves by the company to increase accessibility and expand its reach. Jelli CEO Mike Dougherty said the Jelli Android app is “a completely redesigned version of Jelli's social radio user experience,” optimized for Android but employing the same basic components of the Jelli system on other platforms. The Jelli system allows users to push a song to the top of the playlist by voting that it “rocks,” or vote a song off the playlist by voting that it “sucks.” If enough people vote a song down, it may even be yanked off the air in mid-tune. Jelli rewards listener engagement and loyalty by giving frequent users extra-powerful votes in the form of “Rockets” and “Bombs.” Listeners can also share songs via social media, including Twitter and Facebook, and talk with other listeners about Jelli airplay using online chat. The service has been making steady progress in recent years. In March 2010, the company joined forces with Triton to launch two syndicated versions of its crowdsourced content platform: “Rock Jelli” and “Pop Jelli.” An iPhone app was unveiled in November of that year. In July 2011, the Jelli platform was adopted by two Las Vegas stations, KYLI-FM and KXLI-FM, which were rebranded by owners LKCM Radio and Aurora Media, as Jelli 96.7 (“The New Beat of Las Vegas”) and Jelli 94.5 (“100% User-Controlled Rock Radio”), respectively. At this year’s SXSW festival in Austin Jelli launched a specially curated, SXSW artist-themed, streaming radio station in conjunction with the festival.
As Apple brings its next-generation iPad to market this Friday, it is being met by worldwide consumer and business enthusiasm for the platform that just keeps outpacing estimates. IDC says that worldwide device shipments in the category totaled 28.2 million in the last quarter of 2011, up 56.1% from the previous quarter and representing a massive increase of 155% from Q4 2010. The momentum is impressive, IDC says, and it is raising its 2012 targets appreciably, from an earlier forecast of 87.7 million units to 106.1 million. Apple maintained its overwhelming dominance of the market, 54.7% off of 15.4 million units in Q4. Nevertheless, Amazon shipped an estimated 4.7 million Kindle Fires to reach a 16.8% market share and shave Apple’s slice down from 61.5% in the previous quarter. Amazon’s entry into the market, although limited to the U.S. in late 2011, seemed to raise the profile of the tablet category around the world. “Products across the pricing spectrum sold well, including everything from Apple’s premium-priced iPads to Pandigital’s line of Android-based, entry level tablets [starting at $120],” says Tom Mainelli, Research Director, Mobile Connected Devices, IDC. In fact, despite negative hype surrounding other Android tablets, Samsung actually increased its share of shipped tablets from 5.5% to 5.8% in Q4. Barnes & Noble also introduced the Nook Tablet, which helped the bookseller sell more tablet units but still lost market share, from 2.9% to 2.5%. Apple’s diminished market share is to the benefit of the only major rival, Android. Mainelli sees a scenario in tablets echoing somewhat the evolution of smartphones. Apple will remain the leading single vendor of tablet hardware for the foreseeable future. Still, Amazon’s Kindle Fire success represents the leading edge of an ongoing trend. “The sheer number of vendors shipping low-priced Android-based tablets means that Google’s OS will overtake Apple’s in terms of worldwide share by 2015,” says Mainelli. iOS-based tablets will continue to lead revenue in the category at least through 2016, however. IDC may not be the only one to see the tablet market evolving toward economy Android products. According to recent reports from Asian supply sources, Apple is working on a smaller-sized, lower-priced iPad version (likely between 7 and 8 inches) for possible release in late 2012. The late Steve Jobs had famously mocked the half-sized Android tablets that were hitting the market last year for their poor user experiences. According to Jobs and Apple, smaller screen sizes than the iPad diminish the effectiveness and versatility of the touch interface and enhance the fat finger syndrome. If Apple does indeed release the rumored 7.8-inch iPad for holiday 2012, CEO Tim Cook will have to walk back some of that reasoning.