ECommerce
E-Commerce Sites Have Greatest Influence Over Purchase Decisions
|
Written By Kate Zimmermann | March 6, 2007 | Share This
|
|
A report from eMarketer shows that e-commerce sites have the greatest influence over purchase decisions among US broadband users (more so than TV commercials and Magazine ads combined). Furthermore, though most shoppers do their research online, they are more likely to purchase goods in the store. In other words, online shopping sites are far more valuable than their ability to drive online sales - they contribute a great deal to product research and ultimate purchase decision, whether on or offline.
Related to the eMarketer report, Greg Sterling writes, “E-commerce, as big and powerful as it is, is flattening and “maturing.” Growth will come in trying to built out local inventory data and tie online information to offline stores.” Earlier this week on Search Engine Land, Sterling discussed companies that are attempting to bridge the online/offline gap by creating databases of local retail inventory. NearbyNow, GPShopper, Krillion, ShopLocal and StepUP, are just a few pioneers in this growing market, with mobile banking and Google’s theoretical “Kiosk” close on their heels.
Blip.tv Pioneers Customized In-Stream Video Ads
|
Written By Kate Zimmermann | February 12, 2007 | Share This
|
|
Blip.tv will soon let users add customized, clickable in-stream ads to their videos. Though Blip users can already insert network ads into video content, the new service will let videographers advertise their own sites and products. The first instance of this D-I-Y video advertising will be, appropriately, in the video podcast of Make Magazine. NewTeeVee reports,
“The mechanics of including ads will be similar to those in place for users to add their own stock intro or outro clips to videos. The ads will initially work with content in Quicktime and Flash, though Blip’s Mike Hudack told us Windows Media could be added if there’s enough demand. This means that even videos downloaded and saved, or played in iTunes, can generate clickthroughs and statistics.”
Stats for ad impressions and clickthroughs will eventually be available to users via Blip’s reporting tools. As users become more aware of how to use video as a marketing/sales tool, I wonder what impact it will have on users’ perception of video content ownership and value.
Wal-Mart Shoves Into Digital Video Industry
|
Written By Kate Zimmermann | February 6, 2007 | Share This
|
|
Today Wal-Mart entered the digital video business, becoming the first retailer to land distribution deals with all six major studios - Warner Brothers, Paramount, Sony, Walt Disney, Universal and Fox. Wal-Mart will sell downloadable movies and television shows from its website for roughly the same price as regular DVDs.
Though Wal-Mart’s selection may be unmatched, it’s still questionable whether they’ll succeed in the market. Writes the New York Times,
“To be considered a success, Wal-Mart’s download service will not only have to compete with strong rivals. It will have to pass the same test all services do at WalMart.com: to lure customers into Wal-Mart’s 4,000 stores, to buy groceries, electronics and clothing. Wal-Mart’s online video-rental service failed to do just that, and analysts said the digital download system could encounter the same problem.”
Om Malik echoes this sentiment,
“There are too many me-too download services out there, muddying the waters and confusing the consumers about which movie or television they can download from where, and why….In this land of confusion, it seems once again Steve Jobs will look like a messiah - a device which works with the videos you download from iTunes store. Simple - unfortunately you can’t say the same about Wal-Mart.”
Nevertheless, Wal-Mart’s Goliath approach to consumer products will make it a competitive threat to Apple, Netflix and others. Wal-Mart is reportedly working with HP to create a more user-friendly site, which could be a one-two punch next to Wal-Mart’s “everyday low prices.”
Discussion:
- WalMart Jumps Into Video Downloads (NewTeeVee)
- Wal-Mart Video Downloads for IE only (Frank Barnako)
- Wal-Mart Launches Ho Hum Video Download Service (Geeks are Sexy)
Algorithm Wins All? Competition and Success in Web 2.0
|
Written By Kate Zimmermann | January 29, 2007 | Share This
|
|
Brad Burnham from Union Square Ventures has a written a very insightful post on “What’s Next” for internet technology. He’s articulated some of my own thoughts about the direction of online services and how economies of abundance develop,
“The web services that seem to explode onto the scene like Facebook and YouTube did not get there by providing exceptional reliability, accessibility or security. In fact many have suffered outages that would have killed other service providers. These services succeeded because they effectively gather and use data. They are differentiated not by the quality of their service but by its nature. Competitors can offer much better service levels but without access to the same data, they can not offer the same utility.”
“The genius of Craigslist is in its governance system…that allows 21 people to administer 300 sites in 35 countries. I believe that the basis of competition in web services will shift from the data to the system that manages the acquisition, and use of that data.”
This is especially well exemplified by the emerging online music industry. Last.fm uses behavioral data to make their recommendation engine perpetually more relevant to individual users. Sellaband is an independent music label funded and promoted virally by community members who in turn profit from the company’s success. AmieStreet, similarly, uses popularity to set purchase prices for music downloads. Each of these companies has found a way to profit from their innovative systems of governing community-generated data.
Perhaps, however, the Onion says it best.
MIVA MC Makes Spammers Happy
|
Written By Kate Zimmermann | January 18, 2007 | Share This
|
|
Yesterday MIVA launched their new Monetization Center for publishers, a “one-stop-shop for inline, search and context ads in same place.” MIVA MC is a do-it-yourself wizard that lets publishers monetize multiple sites at once. From the MIVA press release,
“With MIVA MC, partners can choose to display Ads in any of the following formats:
Content […]
Yesterday MIVA launched their new Monetization Center for publishers, a “one-stop-shop for inline, search and context ads in same place.” MIVA MC is a do-it-yourself wizard that lets publishers monetize multiple sites at once. From the MIVA press release,
“With MIVA MC, partners can choose to display Ads in any of the following formats:
- Content Ads: keyword or contextually targeted Pay-Per-Click Ads displayed in fully customized implementations beside site content.
- MIVA InLine Ads: Pay-Per-Click Ads that appear when users mouse over hyperlinked keywords within actual site content.
- Search Ads: Pay-Per-Click Ads displayed in response to specific typed-in search queries.”
In a live demo meeting yesterday, MIVA noted that Directory Ads will soon become a fourth format option.
MIVA is pushing InLine ads as their main point of differentiation. Inline ads resemble links within the text, but reveal a popup text ad when rolled over. Here’s a screenshot of an InLine ad from MIVA’s site demo:
Though the Monetization Center is meant to “promote transparency” between the publisher and the ad network, it’s also enabling the production of spam sites, in particular, splogs. Not only is MIVA’s MC network targeted to “small and medium sized” publishers, but they also have no minimum impression requirement, and no maximum on the number of sites that can be simultaneously managed. Furthermore, MIVA’s ad formats are misleading - InLine ads can be easily mistaken for regular site links, the search box doesn’t serve non-paid results (but doesn’t denote that ads are paid), and future directory ads resemble site content. Because everything can be color coordinated to match the publisher’s site, it’s difficult for users to note the difference between relevant and non-relevant (or paid) ads until after the click.
Considering that just last week MIVA signed a new partnership with Google, I’m surprised that they’d come out with such a splogger-friendly service. Interestingly, during their demo presentation, MIVA made a point to differentiate MIVA Media and Miva Direct - apparently MIVA MC is a product of MIVA Media, and the Google partnership is a deal through MIVA Direct.
Regardless, there’s no doubt that publishers will be able to make money from MIVA MC. MIVA adjusts revenue shares for better-performing ads, so that publishers can reap as high as 70 - 75% of an ad’s revenue. Like I said before, because MIVA’s ad formats are easily mistaken for relevant site content, they’re sure to generate a high volume of click throughs - Good for publishers, bad for users, worse for advertisers.
Discussion:
- MIVA Unveils MIVA Monetization Center (Search Engine Journal)
- MIVA Offers In-Line Content Ads (Search Engine Guide)
- MIVA Launches New Ad Solution for Publishers (Marketing Pilgrim)
- MIVA Matters (Motley Fool)
Google Files Patent for Digital Mall Kiosk
|
Written By Kate Zimmermann | January 18, 2007 | Share This
|
|
New Scientist has spotted a Google patent filing for an interactive kiosk that could potentially replace the “you are here” maps in malls and tourist attractions. The patent states:
“Advances in technology have created new advertising channels to promote products and services. One example of this are kiosk-type billboards typically located in retail outlets, such […]
New Scientist has spotted a Google patent filing for an interactive kiosk that could potentially replace the “you are here” maps in malls and tourist attractions. The patent states:
“Advances in technology have created new advertising channels to promote products and services. One example of this are kiosk-type billboards typically located in retail outlets, such as shopping malls, airports, hotel lobbies, etc. In their simplest form these devices loop through a series of poster-type advertisements promoting, movies, products and/or retail outlets in proximity to the sign to induce specific customer behavior…The following description is intended to convey details involving systems and methods for managing a distributed advertising network of electronic billboards and allocating advertising space in this network based on the proximity of each billboard to categories of retail outlets.”
In other words, Google envisions a video-based public portal that would serve ads and information about stores in the kiosk’s proximity. As Search Engine Land writes, “Imagine getting directions, learning about items for sale, printing out coupons, and seeing how long the wait is at mall restaurants from a kiosk like this.”
Google’s patent doesn’t just put traditional poster advertisements to shame, it indicates how far Google intends to go as an “archive of the world’s information” and as an ad network.
Search Engine Land presents screen shots of a similar patent filed in June that hints at what’s to come:
Discussion:
- Google Patent Filing Hints at Digital Billboard Ad Network (ClickZ)
- Google Advertising On Billboards, Kiosks, TV, and Other Displays (SEO by the Sea)
- Google Outdoor? (Screenwerk)
Brain Study Suggests Consumers Are More Likely to Over-Spend Online
|
Written By Kate Zimmermann | January 4, 2007 | Share This
|
|
Today Stanford University released a study showing that brain activity can be used to predict a consumer’s purchase decision. By identifying different areas of the brain that were active when volunteers viewed an object and its subsequent price, scientists were able to predict whether or not the volunteer would purchase the object.
Furthermore, the results suggest that purchase decisions are made by weighing the pleasure associated with having an object against the pain associated with spending money. This contradicts the conventional theory that purchase decisions are made by comparing immediate pleasure of having an object vs. potential pleasures of alternative objects that could otherwise be had. In other words, rather than considering ‘cost’ as what can’t otherwise be purchased, consumers consider ‘cost’ as the loss of what they already have - namely, cash. As Science Blog writes, “The results can explain the growing tendency of consumers to overspend when purchasing items with credit cards instead of cash, because consumers do not immediately pay for items charged to credit cards and the “pain” of the potential loss is minimized.”
The same logic can be applied to payments made online vs. payments made in the store. Over the past year, online retail spending increased 24%, with record-breaking sales during the holiday season. As methods of online payment become more sophisticated, trusted and efficiently executed (or “Painless”), online sales will increase. This seems like an obvious statement, but it has dramatic implications for whether retailers should encourage the point of purchase online or in the store. A related study by Grizzard Performance Group reports that “more than half of American consumers (62%) do not bother to compare prices at even two land stores before making most of their purchases. However…of those who researched and decided to purchase a particular product on the Internet, 64% would consider purchasing a competitive product if they received a direct response offer of 15% off a comparable brand.”
Together, the studies suggest that a) consumers spend more money online, because it’s less “painful”, and b) consumers are more likely to respond to competitive promotions online as opposed to offline. Marketing Vox writes, “Over 90 percent of consumers say free shipping would serve as an incentive to spend more online this holiday season, and more than 65 percent say special offers or deals not available in stores would boost their online spending”. Indeed, “Online holiday (Nov. 1-Dec. 31, 2006) e-commerce accounted for $24.6 billion, up 26 percent from last year”.
Trans-Pacific Cable to Speed America/China Internet Connection
|
Written By Kate Zimmermann | December 19, 2006 | Share This
|
|
On Monday, Verizon signed with a six Asian telecommunications companies to build a $500 million Trans-Pacific undersea optical cable system. The new cable will speed up communications between the U.S. and China and increase network capacity for Asian & Pacific countries. Fred Briggs, Verizon Business’ executive VP of operations and technology, stated in Information Week, “This project . . .recognizes the emergence of China as a diverse communications hub for Asia, and reflects our company’s commitment to help U.S. and other global companies compete worldwide.” Indeed, last year Chinese internet users spent about $500 million in online advertising and $75 billion in e-commerce.
The cable will help American companies tap into China’s rapidly growing user base. Under the current system, access to overseas websites from China is impossibly slow - as the first Trans-Pacific connection between the US and China, the cable will alleviate the strain on existing networks. Given a faster internet connection, American companies will be better equipped to compete with home-grown services.
Ebay’s recent announcement to turn Ebay China into a joint venture with Tom Online reflects the difficulty that American media companies have had in the Chinese market. One of Ebay’s major problems in China was processing payment transactions - the new Trans-Pacific cable will enable such e-commerce applications (along with the transfer of advanced video and other complex files). Though government regulations, trade sanctions and local competition will still make it difficult for American media companies to succeed in China, the new cable is at least a sign of improvements to come.
Reprise Media Reading List 12 - 14 - 2006
|
Written By Kate Zimmermann | December 14, 2006 | Share This
|
|
Free Directory Assistance
AT&T is testing an ad-supported directory assistance service. Residencts of Bakerfield, CA, Oklahoma City, OK, and Columbus, Ohio can call 1 -800 - YellowPages, listen to an ad, and receive free directory assistance. Verizon is rumored to be testing their own “free” DA system, to compete with AT&T and other similar services. Search Engine Land notes that, unlike Mobile Search, people already know how to use DA and are quick to adopt these offerings.
The Twelve Ways of Click Fraud
Honestly, it was the title that caught me. But, Marketing Pilgrim takes a creative spin on Google’s “2% click fraud”, inviting readers to sing along.
Bully Demands Higher Ranking
Blogger Dean Hunt is being threatened by an online retailer to remove his site from Google for a certain search term or else face legal consequences. Writes the unhappy retailer, “On Thursday morning I checked our google positions and your site is now above us for this term. I haev checked your blog and it has nothing to do with [keyterm]…Please understand that we make our living from this, and you are just writing a blog that has nothing to do with [keyterm]. If you do not remove yourself from google for this search, then I will call them myself and have you removed.”As David’s Life writes, “boo f*cking hoo”.
Google Patent Search
Google has a new search portal for U.S. patents. From Google, “Using the same technology that powers Google Book Search, Google has converted the entire image database of U.S. patents into a format that’s easy to search. You can search the full text of U.S. patents from the Google Patent Search homepage, or visit the Advanced Patent Search page to search by criteria like patent number, inventor, and filing date.” Though it’s not the first patent search engine, it’s certainly the most accessible, and well aligned with Google’s other search services.
Monster’s Monsterous Error
Monster.com informed the SEC that it has overstated profits by $272 million since the late 90’s.
Google Talent Agency
Google is auditioning talented audio industry professionals to become “ad creation specialists” for Google’s new Audio Ads program. Their audition call is running under the tag line “It’s a Jingle Out There….”
Amanda Congdon on ABC
Amanda’s VideoLog is back, now supported with a flashier intro, glowing stage, and ABC logo. The New York Times calls her an “enthusiast for new media“…I think that means they like her.
AOL Downsizing
As part of a massive cost-cutting strategy, yesterday AOL fired 450+ employees from its corporate headquarters in VA. Like Yahoo, AOL is going through an identity crisis, as one of the many search engines struggling to differentiate itself from Google’s shadow.
AdRants Offers Marketers Fake Blog Apology
Step Right Up Folks, “For any marketer who finds themselves at the mercy of forum freaks, blog purists and righteous cause group watchdogs, we promise to create a public apology devoid of marketing and PR babble that is contrite and actually reflects the honest acknowledgment of your idiotic mistake.”
Google Checkout Unprepared for Holiday Rush
|
Written By Kate Zimmermann | December 11, 2006 | Share This
|
|
Google Checkout can’t handle the holiday rush, according to J&R Electronics. This message is posted on J&R’s website:
“Attention Google Checkout customers:
Due to the large popularity of this promotion, we are currently experiencing delays in processing Google Checkout orders. J&R and Google are working around the clock to resolve this problem as quickly as possible. We sincerely apologize for any inconvenience this may have caused. In the meantime, we have removed the Google Checkout option from our site so that we can focus on processing existing orders as quickly as possible. ”
The overload was caused by an online promotion offering $10 off every purchase of $30 or more with Google Checkout. This isn’t the first of Checkout’s problems — Mercury News reports a host of others issues, including slow turnaround, charging errors, lack of customer support, and decreased conversions (due to distrust of the new service). What’s more, many affiliates have had a difficult time tracking sales. A retailer on Webmaster World claims, “Google is washing affiliate links/tracking and not tracking those that are tracked with cookies, so that affiliates won’t get paid for sales made by customers they send to merchants using Google Checkout.” Though Google may not be deliberately “washing” affiliate tracking tags, this is further evidence that Google was unprepared for the holiday rush.
On the other hand, many retailers are willing to overlook Checkout’s woes in the interest of saving money on processing fees. Google is currently offering free transactions until the end of 2007. As one retailer reports, “This is millions of dollars in savings for us merchants… and it is a huge boost in getting a market share or taking it over. We sold an item for a large sum of money and used Google Checkout for processing it, saved us 200+ bucks in processing fees.”
The promotion may not be enough, however, to threaten PayPal’s market dominance — With over 123 million users, PayPal is nearly synonymous with online payment. Though PayPal is notoriously subject to email phishing, Google Checkout’s holiday errors and weak market position may present a greater risk to retailers.