Wednesday, January 30, 2008

Interesting piece on future web ad models from Micro Persuasion - Good Stuff

During a recent exchange with one of my colleagues he posed a thought-provoking question that I hadn't quite pondered. "What new digital business models might take hold over the next four to five years," he asked.

This question should be on every marketing and media executive's mind. As we've seen, the Net is so disruptive that big ideas can come out of nowhere and reinvent advertising overnight - even in a recessionary climate. Google, for example, commercialized pay-per-click ads just after the dot-com crash in 2000.

Here are three models that might evolve over the next few years.

Advertiser-Supported Advertising: Brands are increasingly launching their own content platforms. Some, like Budweiser's BudTV, go it alone. Others partner with online media properties. P&G, for example, embedded Capessa inside Yahoo Health.

In the future some of the more successful marketer-sponsored content sites will accept advertising. The retail space is especially ripe here. Barnes & Noble's media site, in theory, could partially support itself by allowing publishers who they already co-market with to buy ads. Under such a scenario, transparency is critical.

Advertiser-Subsidized Devices: Content is a commodity. The barriers to entry are obliterated. Still, this means we all need to make choices - human attention doesn't scale. So how do you get consumers to choose your stuff? Simple. Use incentives.

Marketers will partner with consumer electronic companies to co-brand white-label gadgets. For example, a Gap-branded set-top box could come with exclusive video podcast subscriptions. Upstart device manufacturers that are looking to enter markets with entrenched players will be the first to dabble with this approach.

Just-in-Time Advertising: Digital advertising creative and planning, like any marketing discipline, follows an arc. It's planned, placed, measured and eventually evaluated, tweaked or tossed. However, in the digital world, brands need to be more nimble.

With the help of new technology, marketers will rely on "just-in-time" campaigns that adapt to conditions. Basically, this takes the Dell manufacturing model and applies it to advertising. Ad creative will morph based on certain triggers. This will include sales/ERP data, blog chatter/consumer feedback, weather/external conditions and more.

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