Brandthony

Get ready to see a lot more “fun young professionals” stock photography like this in the next decade or two because there’s some very interesting news coming out of Nielsen today describing the consumer of the future. According to the research by Doug Anderson, SVP of Research & Development at The Nielsen Company, growth in business in the next 20 years is unlikely to be coming from households with children.

Here are some quick highlights (or lowlights, depending on which business you’re in) from the Nielsen data.

“Marketers in the developed world will be locked into share wars while those able to compete in the less-developed world could see substantial growth.

• Worldwide there is still substantial, though slowing, population growth. By 2030, world population will have grown by around 20%. Only 3.2% of this growth will come from the more developed world. The less-developed regions will grow 31 times faster than the more developed ones. Some of the older countries in Europe as well as Japan will lose population.”

“By the middle 2020s, the share of U.S. households with children under 18 will fall below 30%. ”

“Multi-cultural marketing will be essential when selling to families with children.

• The majority of population growth in the U.S. will come from new immigrants and the children they have in this country. Since most immigrants are young, families with children will become more ethnic, more quickly, than the total population. By 2025, the majority of families with children in the U.S. will be multi-cultural (Hispanic, Black, Asian, etc.). Less than half of families with children will be native born non-Hispanic White.“

“Nielsen projections show per household spending on packaged goods will begin to fall after 2020, while the current recession is already impacting spending in the short-term.”

This seems to be following a trend as noted in a report last year by The Census Bureau, which announced that the share of households with children under 18 reached its lowest point in half a century at 46%, a full 16 points below the 30% range predicted in the Nielsen report.

So what does this mean? If you’re a brand in the CPG category, especially with products aimed at mothers, it is time to do some heavy research into that whole “building relationships through social media” hullabaloo that web-oriented marketers such as myself have been talking about endlessly over the past few years.

And if you’re an entrepreneur? Then it’s time to start building products and services aimed toward the professional 20- to 30-somethings with all of that extra income from not having many, if any, children. And don’t forget those older Gen Xers who’s kids have already left the nest. That’s right, it’s time to embrace the DINKS! (Dual Income No Kids)

I have a feeling that a lot of these consumer electronics are going to do really well in the next twenty years, what with no kids in the house breaking those expensive HDTV’s and Blu-Ray players (or, for me, the Boxee Box).

[NOTE: This post was originally written for the official blog of Conversation, the digital marketing agency for which I am employed.]

While the debate over whether media companies should charge for online content isn’t new, there have been a few interesting new developments in the past couple of weeks that have caused us to want to jump back in the ring on this.

We’re going to invoke an odd example for this post, but it’s a familiar one for us. One of the first entertainment industries which had a lot of media coverage online was the gaming industry, and that coverage reached its maturation point both editorially and technologically well before other industries since its independent media publishers established themselves early. In fact, the two largest sites covering gaming online, GameSpot and IGN, were founded in 1996.

Those two sites grappled with the issue of paid versus free content very early and have provided a retrospective look at the debate. GameSpot and IGN both had intensive subscription models in the late 90’s and early 2000’s, and while they both still have subscription services, the amount of content that has been hidden behind those walls has been peeled back since their introduction. In fact, they’ve been peeled back so much that they merely allow access to HD versions of some videos and private subscription-only message boards that, in and of themselves, don’t warrant the monthly fee.

We’ll revisit them in a moment, but it brings us to the recent news that sparked this post. First, it started with Exhibit A from AdAge: Why Charging for Online Content (Mostly) Won’t Work – a somewhat interesting article, but a bit vague in the details.

Then came Exhibit B, which seemed to contradict A: Newspapers Grapple With How — or Even Whether — to Erect a Pay Wall.

FT.com has 1.6 million registered users and more than 121,000 paying subscribers — up 22% from a year earlier. Unique visitors and page views are growing at the same time.

Then came the nail in the coffin for all those “Internet loonies” claiming that media companies can’t charge for content in Exhibit C: Out of 25 Biggest Newspapers, Only Wall Street Journal Gains Circulation

As permitted by Audit Bureau of Circulations rules, The Journal’s paid circulation report includes subscriptions to its paid website. Excluding 407,002 such electronic subscriptions, up 14.4% from a year earlier, the core print paper actually saw paid circulation decline 2.4%.

Well, there you go, game over. See, subscription models can work, are working, and will work in the future, right?

Well, not so fast. Sure, on the surface the current data seems to suggest that possibility, but here’s where things get tricky. The Wall Street Journal and Financial Times demographics are not representative of the general population and the audience of most media companies. According to a 2007 report on the WSJ’s demographics by Scott Mayerowitz of ABC News:

More than three-fourths of them have a college degree, and their average household income is $234,909. The readers of USA Today and The New York Times tend to earn less.

The Financial Times attracts a similar, if not even more affluent audience.

Nest eggs for FT Wealth readers average £1,251,035 ($2 million USD), over twice that of the more common variety.

Growth in paid online subscriptions from those publications is not indicative of what, say, the USA Today would see if they put a wall around their content. The FT and WSJ attract older audiences who don’t see such subscriptions as burdensome.

And even if the New York Times were to put its paid model back in place and saw paid online circulation go up, the most important stat lies in who those subscribers are. We can only speculate, but odds are they would be older readers who fit a similar demographic profile.

Fact is, “Gen Y,” the twenty-somethings, do not like to pay for content. They have blogs which facilitate such information. They have web sites like BugMeNot, dedicated to fake logins so they can access content to which they shouldn’t otherwise have access. Hell, they could even use the near prehistoric (for their generation) Google Cache to check out those AdAge articles (Exhibit A, Exhibit B, Exhibit C) after AdAge gates them up behind their pseudo-subscriber wall.

And here’s the relevance of the aforementioned IGN and GameSpot subscription programs. They both started out during a time when the age of blogging hadn’t hit its full potential, and both were pulled back even before blogs exploded. Now they have to contend with blogs whose readerships are rivaling their own, and who PR people must respect and provide access to, limiting the amount of content those “mainstream” sites can put behind lock and key. They have to contend with Youtube, Facebook, Twitter, and old school message boards, where all it takes is one guy with a subscription to post that locked content for the world to see.

Sure, subscriptions might work in the short term for older, affluent audiences, and the GameSpot/IGN examples provide an isolated look at the complete opposite demographic, thus giving only a very polarized view of The Great Debate. But time’s a-tickin, and Gen Y still poses the threat to subscription models, no matter what you think, Mr. Greg Harmon, CEO of Beldin Interactive:

Your most avid readers are the ones who are going to pay and they’re the ones responsible for the most page views,” he said. Papers should also be able to charge higher ad rates to reach those paying readers, he said.

The downside is that pay models can constrain growth in traffic, ad inventory and newspapers’ voice on the web. “Our voice is our greatest asset in many ways,” said Greg Harmon, CEO-managing director at Belden Interactive, part of ITZBelden. “Going paid involves thinking really hard about conserving and preserving and advancing voice.”

There is always a younger, cheaper, and voluntary voice willing to trump your paid reporters, even for nothing in return. And going back to what we do at Conversation – igniting discussions about your brands – free content is freely indexed by Google, more inherently shareable on Facebook, Twitter, AIM, and good old-fashioned e-mail, and thus far more practical in today’s web culture.

So for all those now boarding The Subscription Express: welcome aboard, mind the gap between the train and the platform, and we’ll be reaching our final destination in just a few stops.

[NOTE: This post was originally written for the official blog of Conversation, the digital marketing agency for which I am employed.]

It’s about time there has been good news from the Commerce Department, with all the 9.8% unemployment data meaning less consumer buying power in the country and slight depression here in the Conversation offices.

Gross domestic product expanded at an annual rate of 3.5 percent in the three months ending in September, a significant spike from a relatively shrunken base. The economy had contracted at annual rates of 0.7 percent and 6.4 percent in the second and first quarters of this year, respectively.

Even Cash For Clunkers now has some data to provide support for its campaign, with consumer durable goods up 22.3% compared to -23.3% last quarter.

So in an attempt to skip past some other data because your time is precious and ours is limited – what with all of our client work to finish and all – what does this all mean for marketers? It means the American consumer is making a comeback and just in time for the all-important holiday season. So if you planned to slum it through the holidays, pick up the phone and call Conversation now for some timely holiday campaign work.

While this holiday season won’t be like the prosperous ones of 2006 and 2007, it is apparent that holiday 2009 could at least beat out 2008, if only narrowly. With the economy in a slight upturn, there is no better time to jump into the digital marketing arena, because when 80% of consumers are making purchases online and 80% of their time is spent on social networks, isn’t it about time your brand started reaching those consumers where they are?

After all, close to 70% of them are skipping your TV commercials and 20% of Twitter “tweets” mention your brand name.

I usually see a lot of great posts by other marketing bloggers on Twitter all the time. In fact, I see so many it has me planning some interesting content for Brandthony.

In this case I just wanted to highlight a post by Jeff Bullas, which went so in-depth into the SEO value of social media that I had to give him a shout out here on the blog.

How Social Media Can Help Organic SEO : 2 Case Studies

I visited one of my clients today and it inspired me to write this post. Why, well since they rebuilt their website for ”Organic SEO”, implemented a blog and engaged with Social Media since January 2009, his Google search page has gone from a “page eight” ranking on search to “page one”, also their enquiries have increased by nearly 300%. What do they put it down to, well simply “Organic SEO” and its methodologies because he hasn’t changed anything else and as we know, the economy is not booming. So this raises the question, “What is Organic SEO?” this then prompts another question, “How do you implement it?”

The one thing I’ve noticed in my short time working at Conversation, a fairly new social media agency, is that clients still have a hard time understanding the marketing value of social media initiatives. They fully understand the math: hundreds of millions of people are on social networks like Facebook more than any other Web site, but they still do not understand how to utilize the networks to communicate marketing messages. Sadly, attempting to communicate the network effect such an initiative can have seems so foreign from anything they’ve ever studied and experienced that explaining it sometimes raises even more empty, puzzled looks.

I believe, among other reasons, there are two main problems brands have with social media strategy. There are certainly others, but I want to keep this fairly brief especially since I have work to get to.

1. How does “communicating” in a “two-way conversation” with customers translate to sales and how do I measure that ROI?
2. I recently found data that suggests 55% of Twitter accounts are inactive. Not only do I not understand this platform, but it seems as though I won’t be speaking with any real prospects.

Let’s address each one at a time.

1. Communicating in a two-way conversation with customers is fundamentally not a “direct response” initiative, so why are we expected to measure its effectiveness by those metrics? Communicating on social media platforms is branding with the opportunity for sales, not sales with the opportunity of branding. I would argue that conversations can result in brand loyalty and sales, while marketers could argue that conversations could result in just conversations without sales.

Multi-million dollar TV ad campaigns with the intention of branding that could result in a lift in sales gets green-lighted without much of a problem. Whatever happened to the 80/20 principle, where 80 percent of business comes from 20 percent of your customers? What better way is there to constantly communicate in a friendly, helpful way with that 20 percent than through social media. I’ve said it before and I’ll say it again:

Imagine the power your brand can have with the streamlined manufacturing and distribution power of the current corporate marketplace along with the loyalty and customer satisfaction engendered by Mom-and-Pop shops.

2. Now, some may argue that I should discuss Facebook here, but I’ll take on the challenge of explaining Twitter in a mere two paragraphs. First, the basics: Twitter is a platform where a person can “tweet” about anything they find interesting, whether it be “Am I stupid or is quisitive really NOT a word?” or “Wow, check out this cool video: www.video.com.” All of these tweets are archived and searchable, and if another person finds value in what another person is tweeting they can “follow” them and subscribe to their updates so they can keep track of what’s interesting to that other person, who’s often a complete stranger unlike the connections on Facebook.

Now, for the problem of activity. Sure, there are a lot of dead accounts on Twitter and I believe that will always be the case. But check out this information from yesterday’s USA Today by Nicholas Christakis, a physician and Harvard University sociologist who is co-author of a new book, Connected: The Surprising Power of Our Social Networks and How They Shape Our Lives.

Much of the work by Christakis and Fowler is based on research using the Framingham Heart Study, a key group of 5,124 adults within a larger network of 12,067 people in Framingham, Mass. Each had an average of 10.4 ties to others — totaling 53,228 ties.

Now, assuming that most adults have 10 solid offline connections, let’s assume only one of those 10 is on Twitter (10 percent isn’t a bad estimate). Now, let’s assume the average Twitter user has 49 followers. Now let’s also assume the average Facebook user has 120 friends.

Now for the following example, when I say “reach X% of connections,” I mean the connection has actually read and taken note of the message. If you reach only that one person out of that offline group of 10 with a valuable enough message, and they in turn repeat your message on Twitter and Facebook and it reaches 10 percent of their connections (169 total), then your message has now reached 17 other people.

Now let’s say 20 percent of those people (3 people) distribute the message to their network of a combined 507 connections and again reach a conservative 10 percent of their connections, now the message has reached a total of 67 other people. And so on and so forth.

And we haven’t even taken into account how online messages don’t live in a bubble online, and can be spread offline by people who were reached online. In other words, a valuable promotion can spread by word of mouth easier than ever before, and messages live on all media online and offline.

There are still many areas we haven’t touched on, including the fact that you can see what people are saying about your brand in real-time, and have the opportunity to not make the mistakes of, say, Kryptonite bike locks.

That’s the (truncated) true value of social media for marketers.

Another interesting read: ‘Flocking’ behavior lands on social networking sites (USA Today)

Considering my motto is “Blogging A Branded World,” it seems only fitting that I blog about this disturbing image from Stephen Von Worley of Weather Sealed. It’s a heat map (click for full size) of the United States visualized by the distances of nearest Mickey D’s.

Some people may be blown away while others may find the sparse Western area surprising. Having lived in Colorado, it isn’t. Per capita, McDonalds is just as abundant out West as out East, but people are spread out more in the West. When I lived in Pueblo, CO, two hours south of Denver, there was a lot of open space between cities. The closest city north was Colorado Springs (2,000 feet higher in elevation than the much ballyhooed Mile High City), and it took a drive of 35 to 40 minutes through a vast wasteland to get there. Plus, don’t get me started on the emptiest state I’ve come across: Kansas.

McDonalds is the lifeblood and DNA of America, while, at the same time, a remnant of an era from which we’re now transitioning. That’s not to say McDonald’s isn’t as prosperous and ever-present today as it was 10 years ago, but that I do subscribe to the idea of The Long Tail, which asserts the position that we’re fragmenting into specific interests and creating smaller niche markets that, when combined, equal the former dominance of the mainstream. McDonalds is a relic which reminds us that in some industries, however, that movement hasn’t taken place.

Every year it seems people are rumbling about how “[Year X] is going to be the Year of Mobile Marketing.” Yet at the end of each year it seems as though mobile marketing is standing on the edge of a pool, dipping its toe in, and shivering at the touch of the cold unfamiliar water before pulling away, staring into it with nothing but apprehension.

I’ve never really believed that mobile marketing isn’t legitimate because it’s yet to have its explosive year. Some may call it snake oil while I call it what it is: a nascent industry which will grow steadily as the technology catches up to the aspirations.

And the technology appears to be catching up. According to a new Nielsen report, “almost one-quarter of all mobile device purchases (277 million) over the last year were Smartphones.”

Also according to that report social media usage on smartphones jumped 187 percent. That data seems to be backed up by a September 2009 study by TNS Media that shows iPhone owners and owners of more traditional smartphones such as Blackberries and Palms use more or less the same apps, though iPhone users are heavier users.

• 73 percent of Blackberry owners have downloaded or purchased 5 or less apps
• 72 percent of iPhone owners have gone for 10 or more
• Applications priced under $5 appeal to 83 percent of all smartphone owners

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As more and more mobile users adopt so-called smartphones less for their “smart” capabilities and more for their convenient services perfectly articulated by Apple’s iPhone Apps commercials, this creates a new dimension to mobile marketing I dub “SAM,” Services as Marketing.

Essentially SAM is something I’ve used a lot in proposals for my agency, Conversation. For every client, we consider creating online and mobile services which benefit a consumer’s life while creating a positive brand association. In almost all cases, we also try to figure out how to encourage sales from the service, but only when it’s not shoehorned intrusively into it. I’ll talk more about it in future posts, but Purina is implementing the idea well with its “PetCentric Places” iPhone app.

But, let’s not forget that opt-in SMS marketing isn’t bad at all. I can cite plenty of case studies, but I’ll use a personal anecdote. I was sitting around with a few friends the other day thinking about what to get to eat. Suddenly, my phone buzzed and I looked down to see a Dominos promotion from an SMS campaign I had forgotten opting into.

Needless to say, we used the mobile coupon and had some Dominos.

Over 8 million Americans have their identities stolen every year.

Why?

Because we’re stupid.

I know it’s not marketing related, as is the point of this blog, but this thought popped into my head today as I begrudgingly put my Social Security Number on a job application. I feared doing so because of someone mishandling the applications, or tossing them in the garbage without shredding them for curious thieves to find. Then, it came to me. The stupidly simple solution to identity theft.

Solution: When your social security number is used for processing by any company except retailers, the government should call the person with that social security number for their authorization. The government would have contact information tied to every SSN, which would be verified and updated every three months. The reason I exclude retailers is because that’s the domain of the individual banks and credit card providers, who seem to be doing a decent job in that department as of late.

Now, I may be naive and this may already be an existing solution that has just never found its way to me, but if it isn’t then I think it’s a viable one. If you’re concerned about the cost and man hours to process these requests, then let me kick some more data your way which shows we’re already sacrificing those dollars and hours already.

Time Involved in Being a Victim

• Victims spend from 3 to 5,840 hours repairing damage done by identity theft. This difference is due to the severity of the crime – for example a lost credit card versus the use of your social security number to become your “evil twin.”
• The average number of hours victims spend repairing the damage caused by identity theft is 330 hours.
• 26-32% of victims spend a period of 4 to 6 months dealing with their case and 11-23% report dealing with their case for 7 months to a year.

Monetary Costs of Identity Theft

• 40% of business costs for individual cases of identity theft exceed $15,000. The Aberdeen Group has estimated that $221 billion a year is lost by businesses worldwide due to identity theft
• Victims lose an average of $1,820 to $14, 340 in wages dealing with their cases
• Victims spend an average of $851 to $1378 in expenses related to their case

This isn’t my area of expertise so my suggestion may be, in fact, “too stupid” for those in the know. But if nothing else, I think it could make for a good discussion on the subject. What do you all think?

So I have to work on a list of bars for my latest internship and I was shocked when I saw this gorgeous bar at the Hudson Hotel in Central Park West. I’m a huge movie freak and I immediately thought “2001,” and surely enough the description at the right mentions it. This is just a beautiful piece of work that I gotta commend them for, even if I don’t have much to say about it right now.

Click the image to see it in all it’s glory. What do you all think?

UPDATE: Here’s a capture of 2001 for reference.

So now that I’m on the job market, I’ve noticed one constant during my job search. Whether or not the job posting explicitly asks for someone to fill the position or not (and there are a lot of Social Media postings out there), a question about social media pops up in just about every job interview I’ve been on. Hell, there are even doctors out there looking for social media wizards.

In these interviews I’m generally asked how I would use social media to improve the company. The other day, after being asked for the third straight interview, I responded with with this.

“I could name a whole bunch of fads, but it would be difficult for me to tell you offhand what exactly would work well for you. What’s most important is that whatever I would develop for you would have to do one of two things: Create a valuable dialogue between this company and your consumer or make it easier for that consumer to share interesting information about your company to others that’s of value to their lives. If you don’t accomplish that, then you might as well not do it because you won’t be successful.”

That may seem like common sense, but I’ll be damned if I don’t see the rule broken all over the place. Right now there’s an unhealthy love affair with social media that’d been ginned up due to articles in BusinessWeek and the like about how social media will turn your also-ran into the lead dog in whatever field you’re in.

That’s horse sh*t.

Anybody peddling that propaganda your way is no better than late night infomercials for products like the Internet Treasure Chest that’ll make you hundreds of thousands of dollars in as little as 10 minutes/day. Hell, just double-check that job posting I mentioned earlier. They want a social media person to work magic in only 10 hours a week.

Bottom line is that the fundamentals of advertising that held true at the advent of the craft still hold true in social media: benefits, not features, sell. Right now everyone is obsessed with the features, these platforms that provide easy ways to reach hundreds and thousands of people. All the while, they’re missing the benefits. The benefit to the consumer is the value you add to their lives through social media. If you’re not delivering on the benefits, then you better start re-evaluating your strategy.

People seem to forget that Twitter, for example, is opt-in by nature. Just as quickly as you can gain 100 followers, you can lose 70 the following day if you’re peddling garbage. But unlike e-mail, where unsubscribe links are small and often hidden as legally as possible, the unfollow button is prominently displayed under your name on Twitter.

I’ll leave you with a final thought from Maria Veloso’s excellent Web Copy That Sells (which is indeed very good, even though the cover looks like that of a terrible text book) and it comes from Author Sidney J. Harris.

“The two words ‘information’ and ‘communication’ are often used interchangeably, but they signify quite different things. Information is giving out; communication is getting through.”

So stop contributing information. Noise is cluttering the web faster than carbon is clogging up the atmosphere. Make your mark, or miss the party.