When I wake up and look outside, I still can't believe it's already summer. With the barrage of innovation, both on the technology and media sides, time seems to move past us faster and faster.
One of the byproducts of this fast-paced environment of change is the excitement of uncertainty that each day brings. Just a couple of years ago, the speed of news was dependent on the rate at which someone could blog or a news outlet could publish a report online. Now, news is broadcast instantly via Twitter and the vast array of social networks. The only time I'm not inundated with the latest happenings is when I'm asleep.
With the current economic climate, the excitement of uncertainty brings new meaning. There is the uncertainty on the macro-economic scale that affects whether or not we have a job each day. While the interactive industry has felt the effect a bit less than many other industries, it has been impacted nonetheless.
Brands have been forced to sharpen their pencils, get more creative, and engage with their consumers to a greater degree than we've ever seen. These new engagement touch points have created new consumer expectations of brands. Some brands have done a stellar job, while others have not met the expectations of their audience. In both cases, the interactive landscape has become a constant learning opportunity.
There are many great stories from the first half of 2009. Here are a handful of the most important developments, and how they have affected the interactive industry.
Twitter hits the tipping point
When Twitter first launched in mid 2007, it was virtually unknown. The early adopters consisted of techies and a handful of us marketing technology geeks. As the service started to build, the light turned on for many of us. We started to see the potential for corporate and personal brands to leverage this powerful tool. Twitter brought the "always on" communication possibilities to a whole new level.
This year has seen Ashton Kutcher, Lance Armstrong, CNN, and others surpass the 1-million-followers milestone. Celebrities such as Oprah, the cast of "The View," and Britney Spears have found a new tool to more frequently update their fans on their thoughts and the details of their lives.
Publishers and media outlets have also embraced Twitter as a new mechanism to distribute their content and drive people to the stories contained in their digital properties. Besides CNN, we've seen the Twitter audiences for ESPN, The New York Times, "Good Morning America," and NPR climb at exponential levels over the course of the last six months.
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Not to be outdone, many brands have jumped into the fray, utilizing Twitter as another touch point to communicate with their fans. Brands that have successfully embraced and utilized Twitter to engage their audience include: Southwest Airlines (@SouthwestAir, 89,000+ followers), Zappos (@Zappos, 788,000+ followers), and Jet Blue (@jetblue, 693,000+ followers).
One of the interesting examples of Twitter's influence and effect on media consumption came on Jan. 15, when the very first reports and pictures of US Airways flight 1549 came to us from the Hudson River through Twitter. The accounts and pictures from this amazing story came pouring in via Twitter faster than mainstream news outlets could possibly report. Unfortunately, while a couple of airlines have embraced Twitter, US Airways has chosen to remain silent. Regardless, this is the point where many were either first exposed to Twitter (through mass media reports). We were fascinated and turned on to its power as a communication tool for individuals, media outlets, and brands alike.
Display advertising is lagging, or is it?
As we entered 2009 and the economy continued to take an even bigger nosedive, industry speculators began to weigh in regarding its effect on advertising and, more specifically, the effect on different types of online advertising. The general consensus was that while search wouldn't take a big hit, display advertising was going to be crushed by brands pulling out to focus on other formats with a more predictable and higher yield ROI.
This prediction had many publishers concerned. From a marketer standpoint, many in the direct response sector looked at this news as an opportunity to pick up a greater volume of remnant inventory at prices that would yield a significant ROI. This devaluation of display had the potential to wreak havoc for many publishers who rely on its revenue to support their businesses.
While display advertising, along with all other forms of online advertising, has historically enjoyed continual double-digit growth, things seem to have come to a screeching halt this year. The latest predictions over the course of 2009 show that display will take an overall retreat of 2 percent, while other forms of online advertising (search, social media, emerging media, etc.) are predicted to have single-digit revenue gains.
Ironically, the predictions have only partially held true. While some publishers have seen drops in their prime inventory sell-throughs, others have not. News recently released by Nielsen showed that some of the country's largest CPG brands, like Procter & Gamble, increased their Q1 display advertising spend by 27 percent over Q1 2008. Large eyeball sites and networks like YouTube and AOL reaped the increased display spend from the CPG category.
While new social media tools allow people to more easily connect with each other, as well as the brands they like and trust, tight social connections are also making it easier to spread the news when something goes wrong.
People do stupid things. This has always been the case, and will continue as long as people populate the earth. The difference is now everyone is watching. When a couple of Domino's Pizza employees from North Carolina videotaped themselves doing disgusting things to food that was supposedly going to be delivered to a customer, it was a case of pure stupidity.
Thanks to YouTube, various social media sites, and the resulting Twitter storm, the video spread virally and quickly brought national attention to this foolish act. The damage to the brand was done.
The good news is that due to social media monitoring and lessons learned from the past (think Dell Hell and Motrin Moms), Domino's responded one day later. The company released its own video apology from its CEO on YouTube, and stepped up its own social media efforts, which were already actively in place before the incident.
While many felt that Domino's' one-day lag before posting a response was slow, it was significantly faster than the responses to brand damaging incidents that have happened in the past. The key for Domino's was that it was already active in social media with a YouTube channel, Facebook page, and Twitter account. This social media entrenchment likely saved the brand from a mushroom cloud of damage that would have been difficult to recover from.
We're in the middle of the worst economic climate in our lifetimes, and while some industries are feeling it more than others, we're all feeling it. Everyone's daily lives are affected, as concern for our own livelihood festers in the back of our minds. As positive and forward-thinking as we can be, it's impossible to ignore the fact that things are different.
While it's easy to place some level of blame for their own demise, the industries that have publicly taken the biggest hits are the banking/mortgage, real estate, and auto industries.
We have all been barraged by information about how each of these industries had a hand in the overall economic downturn, but in terms of our industry, these are also very large advertising sectors. When their revenue goes down the toilet, many of the advertising dollars head in the same direction.
As an example, with GM in bankruptcy, there has been a ton of speculation regarding the impact this will have on the overall advertising industry. Will it cut advertising across the board, or focus cuts in one medium over another? It's a little too soon to tell, but it's not going to be pretty.
Just as disturbing as future advertising cuts is the hit ad agencies will take in regards to their outstanding accounts receivable. A recent Wall Street Journal story listed GM's creditors, and Starcom Mediavest Group Inc. was listed as the sixth largest, ahead of auto parts maker Delphi. It's going to be interesting (and scary, if you're an ad agency) to see how these stories play out as more and more brands across multiple industries are currently flirting with bankruptcy.
In the financial sector, banks and the resulting consolidations have opened up additional regionally focused advertising. In addition to the establishment of a brand in new regions (think Chase coming to California after taking over Washington Mutual), financial brands have correctly focused their advertising efforts on winning back consumer confidence after a series of unsound business practices served as the catalyst for the mess we find ourselves in.
Doing more with less
At the recent iMedia Brand Summit in Colorado Springs, there was a common theme among marketers. All of us are feeling the unparalleled pressure of doing more with less. Many companies have not only gone through staff cuts, but have also put hiring freezes in place.
At the same time, measurement is the name of the game. All advertising is expected to be measured with ROI in mind, which has traditionally been a more significant mantra of direct response advertisers. Cross media measurement is now becoming a standard expectation of all marketers.
Although measurement and analytics are at the top of the list for all marketers, taking a close second is the continual expectation to innovate. Part of this innovation is the marketing involvement in social media, which is no longer being viewed from afar as a few brands become the guinea pigs. It's gone from a spectator sport to a full-contact game that marketers are figuring out quickly.
With the exception of social media, brand managers are reluctant to take risks right now, and are instead focusing on proven, highly measurable ROI methods in which they already have the green light from their managers. With the shifting sand, some emerging media is being pushed to the backburner because brand managers would rather not rock the boat for fear of losing their own jobs. This doesn't mean that innovation has been shelved completely, but rather that it is becoming a smaller piece of the pie as many opt for the safety of proven advertising mediums.
Regardless of whatever else brands will dive into in the second half of 2009, one thing is for sure: It's going to be exciting.