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June 22, 2010

This Week's Buzz within the Digital Space

June 14th-18th

Apple and Google are at it again. Apple has publicized an addendum to their licensing agreement which bans any ad provider that is affiliated with a mobile hardware or operating system company (most notably, Google's recently acquired Admob) from gathering user data on their platform. Data collection is such a vital component of digital advertising; without it, we are unable to evolve our marketing strategy to adopt to and serve consumer preferences.

Although Apple now seems to have an unfair advertising advantage, can we really blame them for not wanting to facilitate and benefit their competitor? This interaction epitomizes the companies' differing strategies: closed versus open.

Interest in 3-D technology continues to heighten. From 3-D World Cup coverage to 3-D gaming, digital headlines this past week were swarming with mention of 3-D innovation. Unfortunately, this technology appears to have a fatal flaw. Thinking back to the basics of product diffusion, will our desire to adopt outweigh the complexity of integrating 3-D tech into our lifestyle? Does 3-D offer a significant relative advantage to good ol' fashion 2-D? The possibility for consumer rejection is high'but the potential for adoption could have huge implications for the future of advertising.

Three brave advertisers (Sony, Gillette, and Disney-Pixar) are attempting to target these early adopters'while paying a 30-40% premium for a 3-D spot. ESPN's 3-D channel premiered the first ads which were designed specifically for live 3-D programming on June 11th. Their experiment with 3-D ads is just the beginning. The television networks, the cable providers, the hardware producers, the ad producers, and the consumers must all be on board in order for this technology to take off.

Consumers love iPad advertisements. The average user's interaction time with an iPad ad is 30 seconds and click-through rates have run between .9% and 1.5% (6x the traditional web benchmark for click-to-expand ads). Currently, we can only speak for the early adopters who are enamored with the device's functionality: including the interactive ads it serves them. But as publishers begin to experiment with the iPad and discover new methods to engage their user (see: Time's already evolving iPad application), mainstream participation could be in sight.

Despite this success, similar to what was discovered during the early days of the Internet, an improved method for measuring participation must be established: click-through rates are no longer relevant. A new tool from comScore, for example, tracks what happens after a customer views an ad (do they do a product search? do they visit a B&M store?) by cross-referencing their metrics with offline data. If we continue to measure ad success based soley on CTRs, what will happen when the iPad becomes mainstream? CTRs will seem to deflate while that might not be a true indicator of a decrease in engagement.

June 22, 2010

This Week's Buzz within the Digital Space

June 14th-18th

Apple and Google are at it again. Apple has publicized an addendum to their licensing agreement which bans any ad provider that is affiliated with a mobile hardware or operating system company (most notably, Google's recently acquired Admob) from gathering user data on their platform. Data collection is such a vital component of digital advertising; without it, we are unable to evolve our marketing strategy to adopt to and serve consumer preferences.

Although Apple now seems to have an unfair advertising advantage, can we really blame them for not wanting to facilitate and benefit their competitor? This interaction epitomizes the companies' differing strategies: closed versus open.

Interest in 3-D technology continues to heighten. From 3-D World Cup coverage to 3-D gaming, digital headlines this past week were swarming with mention of 3-D innovation. Unfortunately, this technology appears to have a fatal flaw. Thinking back to the basics of product diffusion, will our desire to adopt outweigh the complexity of integrating 3-D tech into our lifestyle? Does 3-D offer a significant relative advantage to good ol' fashion 2-D? The possibility for consumer rejection is high'but the potential for adoption could have huge implications for the future of advertising.

Three brave advertisers (Sony, Gillette, and Disney-Pixar) are attempting to target these early adopters'while paying a 30-40% premium for a 3-D spot. ESPN's 3-D channel premiered the first ads which were designed specifically for live 3-D programming on June 11th. Their experiment with 3-D ads is just the beginning. The television networks, the cable providers, the hardware producers, the ad producers, and the consumers must all be on board in order for this technology to take off.

Consumers love iPad advertisements. The average user's interaction time with an iPad ad is 30 seconds and click-through rates have run between .9% and 1.5% (6x the traditional web benchmark for click-to-expand ads). Currently, we can only speak for the early adopters who are enamored with the device's functionality: including the interactive ads it serves them. But as publishers begin to experiment with the iPad and discover new methods to engage their user (see: Time's already evolving iPad application), mainstream participation could be in sight.

Despite this success, similar to what was discovered during the early days of the Internet, an improved method for measuring participation must be established: click-through rates are no longer relevant. A new tool from comScore, for example, tracks what happens after a customer views an ad (do they do a product search? do they visit a B&M store?) by cross-referencing their metrics with offline data. If we continue to measure ad success based soley on CTRs, what will happen when the iPad becomes mainstream? CTRs will seem to deflate while that might not be a true indicator of a decrease in engagement.

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