This year, the worldwide internet population is 934 million. In 2007, the worldwide internet population is projected to reach 1.35 billion. (Both figures are from the Computer Industry Almanac).
With the rapid growth of online users in countries such as China (by the end of this year alone we will have seen the online population in China go from 70 million to 100 million) and Japan (the percentage of households in Japan using broadband is set to grow to over 70 percent by 2007, according to eMarketer), coupled with top U.S. internet companies like Google and Yahoo! expanding their international operations, companies must start viewing globalization as a necessity rather than a sideline.
One only needs to look at the recent activity in the online space to realize that global online fusion is happening right now.
Enter Livedoor, Inc., a leading online media services company and a wholly-owned subsidiary of Japan-based Livedoor Co. Ltd., arguably one of the world's largest media companies with a current market cap of over four billion U.S. dollars.
Livedoor recently acquired ClickDiario Network. In April of this year, comScore Media Metrix ranked ClickDiario Network as the fastest-growing Hispanic network. The company ranks in the top 10 most popular advertising networks focused on the Spanish-language online market. ClickDiario has more than 200 clients including several Fortune 500 companies.
According to Livedoor Executive Vice President Noriaki Okubo, "the acquisition of ClickDiario strengthens our international presence and is a clear example of Livedoor's ability to deploy on our strategy of being a leader in technology and media services worldwide."
ClickDiario's proprietary network consists of more than 30 vertical websites that are visited by over 45 million unique users per month. The company's main websites include portals such as Deportes.com (Sports), Salud.com (Health), Mujer.com (Women), Mascotas.com (Pets), Boletines.com (Newsletters), Dietas.com (Diets), and Tarjetas.com (Greeting Cards).
Beth Cann, vice president of marketing for Livedoor, Inc., believes that the acquisition is a highly strategic move, especially to penetrate the burgeoning U.S. Hispanic market.
"If you take the U.S. Hispanics as a whole in buying power it would be the second largest Spanish speaking country in the world -- 700 billion dollars in purchasing power, and it's projected to reach one trillion in another five years! You can't ignore the Hispanic market. The only question is how do you get to them? The online Hispanic market is very young and their average age is substantially lower than the general market. Fifty-six percent of Hispanics online are between the ages of 18 and 34, versus the general market of 34 percent being 18 to 34. Online Hispanics' medium age is 26 years age versus 33 of the general market. They're early adopters in terms of technology. For example, the Hispanic market skipped the dial-up generation and is adopting broadband at a higher rate than the general market. They're new to the market so they're going for the state-of-the-art technology. The growth of internet use by U.S. Hispanics is growing at a much faster rate than that of the U.S. general market."
In accordance with Cann's views on U.S. Hispanics, the Direct Marketing Association recently released the 2005 Hispanic Market Report that highlighted three significant facts for marketers:
- U.S. Census projections indicate that the Hispanic population will triple to over 102 million by 2050
- Hispanic-Americans are increasing in affluence and are among the most credit-worthy customers in the United States
- Hispanic-Americans have a purchasing power currently greater than 600 billion U.S. dollars and expected to grow to one trillion U.S. dollars by 2007
Tom Tauli, a writer for Forbes magazine and author of "The Complete M&A Handbook" argues that, "more and more, advertisers want to target foreign markets. That's the key with Livedoor's latest acquisition. While it has done well in Japan -- sporting a four billion dollar market cap -- it realizes it needs to expand its reach. With the purchase of ClickDiario.com, Livedoor gets more than 30 vertical sites that focus on the Spanish-speaking world, which is certainly a coveted demographic. Dealing with foreign online markets is no easy feat -- so, acquisitions make a lot of sense. Expect more of these types of deals to come."
Aggressively expanding Spanish language outreach to the U.S. Hispanic market as well as in Latin America and Europe is what will make companies such as Livedoor key players in the online international marketing space.
Online globalization is happening right now. Companies that want to stay ahead of their competitors and increase market share in global markets must take the necessary steps.
In his book "The Lexus and the Olive Tree," Thomas Friedman writes, "John Chambers of Cisco likes to say that the companies and countries who will thrive in this internet economy are those who will grasp its importance first, and get wired before the rest of the world realizes that they have to change. If you do that faster than your competitors, says Chambers, there's only one thing you'll have to say to them: 'Game over'."
"No Summer Break for Media M&A" by Tolman Geffs of The Jordan, Edmiston Group.
Elizabeth M. Lloyd is chief marketing officer of DMO Global, a leading affiliate network solely dedicated to serving international and multicultural markets. Lloyd's work on international online marketing has been highlighted in numerous publications as well as in academic curricula for MBA international marketing programs worldwide. DMO Global is a wholly-owned subsidiary of Dragon Media Online, Inc.
Location-based marketing is mobile marketing
At their core, location-based marketing services rely heavily upon consumers' engagement through social media channels via their mobile devices. Thus, it would be a mistake to treat location-based marketing as a completely new media channel that is untethered to the realities that we've learned about other areas of the mobile marketing channel over the last few years. Factors to consider include how and when consumers prefer to be engaged, the value that both the brand and the consumers receive when campaigns are properly executed, and the intrinsic benefits that differentiate the channel from other alternatives.
Even more importantly, advertisers must remain mindful of the extremely personal nature of mobile and social media platforms to avoid executing campaigns that either infringe upon individual privacy or are intrusive. With this in mind, I highly recommend that advertisers considering location-based campaigns familiarize themselves and their agencies with the MMA's Global Code of Conduct for mobile marketing (a PDF of which can be downloaded here) and U.S. Consumer Best Practices Guidelines (a PDF of which can be downloaded here).
Unique, relevant experiences are key
As we've already witnessed with thousands of mobile applications, ringtones, and games, mobile consumers can be extremely fickle. As quickly as they adopt new offerings, they can be just as quick to discard them. Therefore, advertisers looking to integrate LBS offerings into their media plans should look past the gimmicky campaign de jour and instead invest in well-thought-out campaigns that are designed to build on their relationship with their targeted consumers.
In my opinion, the most successful mobile marketing campaigns have several things in common:
- Creative capture mechanisms that demonstrate relevance to the target audience
- Ongoing branded engagement designed to encourage interactivity to avoid the appearance of one-sided communications
- Sufficient rewards to demonstrate appreciation for consumers' time
An example of a firm that appears to be getting location-based marketing right is PepsiCo. The firm recently partnered with LBS provider Foursquare to add location awareness to its loyalty program in order to drive foot traffic for its restaurants and retail partners. Consequently, when loyalty club members are near one of its partners' locations, Pepsi can present an offer to drive them into the store. In addition to the Foursquare program, the company is introducing its own location-based iPhone application, through which customers can collect points toward free music downloads.
A few firms are leading the way, but others are moving quickly
Although location-based mobile advertising is clearly in its infancy, there are signs that the industry is heating up and is ripe for new entrants both large and small. In recent weeks, there has been broad speculation that Facebook and Twitter are preparing their entrance into the space. And on May 25, Yahoo announced that it had acquired Kropol, a LBS provider based in Indonesia. While traditional social media and web giants are pondering their plans for the space, there is presently a growing cadre of smaller players with innovative offers, sufficient brand recognition and growing subscriber bases establishing early leadership positions in the space.
Below is a brief overview of a few of the most-talked-about LBS providers and their approach to the space:
One of the earliest pioneers in the space, Loopt describes itself as a location-based social mapping service. The service uses GPS and interactive mapping to allow subscribers to use their location to discover friends, places, and events around them. The firm boasts a subscriber base of more than 3 million registered subscribers and has established relationships with most of the major U.S. mobile carriers.
In recent months, the firm has been bolstering its offerings to remain competitive with aggressive new market entrants. For example, the firm recently begin offering its subscribers rewards for "checking in," an extremely popular feature of fellow LBS player Foursquare. The firm also offers advertisers a variety of mobile advertising options, including click to call, click to video, and click for coupons.
Launched in March 2009, Foursquare is often credited with both literally and figuratively changing the game for location-based marketing by adding a gaming element to its offering. Foursquare's subscribers share their location with friends by checking in via their smartphone app or text message and are awarded points for checking in at participating venues. Furthermore, by checking in a certain number of times, users can collect virtual badges. Those who have checked in the most times at a participating venue can be crowned "mayor," entitling him or her to special privileges, offers, or discounts until someone surpasses that person's number of check-ins.
According to an April 2010 article in Forbes Magazine, since its launch, the company claims that more than 725,000 users have checked in more than 22 million times at almost 2 million places. The company has captured the attention of some of the country's most prominent brands, including Pepsi, Warner Brothers, and HBO.
Also founded in 2009, Austin, Texas-based Gowalla's business model and approach is very similar to that of Foursquare -- so much so, in fact, that the two are widely considered the key competitors to watch in the space. Gowalla's subscribers can capture and share their location in the world with friends and family, while discovering new places, events, and trips as they go. Also, much like Foursquare, Gowalla works as a game that awards subscribers points based on how often they go out, the number of places they visit, and even the number of friends they meet with along the way.
MyTown is a location-based application built around local shops, restaurants, and hangouts. Although it does offer advertising opportunities and is location aware, it is actually more akin to social games such as Zynga's Farmville and Mafia Wars -- which are extremely popular on Facebook and other traditional social networks -- than it is to the other firms described here. In May, the firm announced that it now has more than 2 million users who play the game on an average of more than 70 minutes a day.
MyTown's users check in at nearby businesses to gain experience points, unlock rewards, and earn cash to buy their favorite real-life places. This cash can also be used to "buy" the businesses around the users, which in turn generates more cash in the form of rent.
Don't be afraid to explore on your own
If you are of the opinion that the current breed of LBS providers don't meet your brand's needs, or perhaps you're interested in supporting a very closed community with your LBS offering, it might make sense to consider building your own location-based mobile offering. Although the vast majority of the buzz around LBS offerings is presently focused on network service providers, such as the ones I described earlier, the book has yet to be written on the best formula for executing LBS offerings for all brands. Therefore, now is the time to experiment. If you do choose to go down this path, the good news is that there are a growing number of options available to assist. For example, Shout'Em and Socialight (described below) offer platforms that allow anyone to develop and manage their own location-based social media networks.
Croatia-based Shout'Em provides businesses and individuals with the tools required to create a simple mobile social network. The firm offers both an ad-supported free solution for small communities and an enterprise solution for more advanced online communities such as news and sports organizations and local social networks.
Socialight, a New York City-based firm, recently launched its Socialight Community Platform, which is geared toward enterprise firms. This platform is designed to help enterprise and brand clients connect multimedia content and information to a map interface that can be accessed via a website, mobile site, or application.
Google's Latitude and Places
In addition to the above platform providers, Google recently announced that it is now providing developers free access to its APIs for its Latitude and Places location services. Access to these APIs should enable developers to build location-aware apps without having to make all of the investments in the backend infrastructure that the current LBS leaders have had to make. By taking this action, Google hopes it will spur development for many unique implementations beyond the location-based check-in battle, which could be great news for do-it-yourselfers.
We've known for a while now that mobile phones are having an indelible impact on how and when consumers gain access to the things they care about most. Through LBS, we are just starting to comprehend the full potential benefits to businesses for helping consumers make more informed decisions when on the go.
Four key factors contributing to the current success of LBS services are:
- Mobile consumers' growing demand for real-time access to information when they are making decisions
- An increasing proliferation of internet- and GPS-enabled smartphones owned by consumers
- Significant improvements in wireless carriers' network infrastructure
- The explosion in consumer adoption of mobile social media platforms
Taken together, these factors are affording advertisers something that has previously eluded them in most other media channels: a heavily engaged consumer willing to interact with advertisers and accept marketing messages at the point of selection.
In fact, at the end of the 2009 holiday season, in a study conducted by Motorola, researchers found that the usage and impact of mobile shopping technologies exploded as shoppers turned to their mobile phones for activities spanning multi-channel comparison shopping, peer feedback, product info, and couponing. Further, 51 percent of all shoppers and 64 percent of those between the ages of 18 and 34 used their mobile phones for in-store shopping-related activities during the holiday season. In addition, a recent study conducted by the U.S. arm of the Mobile Marketing Association (MMA) and researcher Lutz and Associates found that nearly 50 percent of those who noticed ads while using a location-based service took some action. Given these findings, one can clearly see why advertisers are thrilled with the promise and potential of LBS offerings.
The LBS providers that ultimately garner the most success in the space might come in far different shapes and forms than the firms currently hyped in the media. However, from what we've learned thus far, it absolutely makes sense for advertisers to embrace the technology and the potential benefits to their customers and brands.
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For GE, the main KPI on YouTube is not views or clicks -- it's shares. Shares are indicative of a viewer's enjoyment of a piece of video content. Shares tell GE that it has produced a video or partnered with creators who have made something funny, profound, or memorable. Fullscreen looked at that goal and enlisted the talent of various content creators on YouTube who could help. It's important to note that the company did not do this arbitrarily; it analyzed the GE audience and identified the demographic and life stages that were highly indexed to be communities that would share GE content. It matched that with creators who would resonate with that audience. Fullscreen then established a genuine relationship between GE and those creators. It didn't simply send out a brief and have the talent send back a video; Fullscreen made sure that GE actually had a relationship with its content creators that was valued, and that the creators understood the GE story. In turn it received stellar video material.
James Veraldi continues our conversation by speaking to iMedia about how Fullscreen aligned talented content creators with GE. Katrina Craigwell also discusses the internal philosophy of experimentation and risk-taking that allowed the company to partner and rely on external video assistance to achieve ambitious goals.
In the end, GE had 350 videos cumulatively reach 6.8 million earned and owned views in 2013 after this strategy took effect and original influencer content was injected in the GE voice. Paid media dropped from 80 percent to 40 percent, and earned and owned media both currently sit at 30 percent of proportion. GE was able to grow its subscriber base and earn viewership through constant optimization of content and channel. It optimized its media campaigns for shares and conversions, applying targeting at the channel and content level. And by putting native YouTube content creators at the forefront, it was able to tap into the influencers who would be most effective at reaching the demographic who would share videos, and in turn the GE brand.
Veraldi and Craigwell end our conversation by discussing the success and metrics of this partnership and GE's future platform expansion plans.
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"Man with flag" and "CIRCA MARCH 2014 - BERLIN: the logo of the brand "General Electric"." images via Shutterstock.