Archive for the ‘Video Podcasts’ Category

Let the Web Entertain You

October 2, 2006

People are using the Internet as much to be amused as to stay informed; why haven’t advertisers caught on?

Meet Andy Oglesby. He’s a 40-year-old graphic designer who lives in San
Francisco and spends most of his waking hours online. It begins at
work, where each morning he hits a tab on his browser that opens some
20 sites and blogs. He’ll read, browse, and sift through them, on and
off, pretty much all day–

if ly about one-quarter of the sites are
strictly work-related. And the non–work-related surfing continues well
into the evening, when he’s at home. There, he and his longtime,
live-in girlfriend spend many weeknights together on the couch, TiVo
on, notebooks on laps, surfing the Net. They’ve even been known to
instant-message each other things like, “What’s for dinner?”

Oglesby
is one of a growing number of people spending long stretches on the
Net, searching for amusement, often with no destination in mind. Indeed
the tendency to use the Web more for play than work—to find
entertainment and not just information—is surging. According to the Pew
Internet Life Survey, on any given day, 40 million Americans go to the
Web for no particular reason, just to pass the time. The total almost
doubled from 2004 and experienced “striking growth” in the last year,
Pew says.

NOT JUST FOR KIDS. Infact, Pew has found that more people are entertaining themselves via the Web than buying things, despite the successes of eBay (EBAY), Amazon (AMZN), and other e-commerce players. If the Internet was already a virtual
post office or library, it’s now a virtual “destination resort,” Pew says.

And as Oglesby demonstrates, the trend isn’t just for
youth. The quest for online amusement cuts across all races and income
and education levels. Make no mistake—the younger the user, the more
time they’re likely to spend entertaining themselves online. But 20% of
all Internet users over 65 go to the Web every day just to amuse
themselves, according to Pew.

Even sites typically associated with teens are playing to a wider audience. Who knew that 10% of MySpace (NWS) users are older than 55—and that the proportion of MySpace users in the 12 to 17 range has dropped to 17% from 22% in the year through May?
More than one-third of Facebook users are older than 35, and more than
half of YouTube’s faithful are between 35 and 64, according to a study
by eMarketer.

REVOLUTION NOW. That the Web has become a hub of entertainment is no shocker, of course. What’s been more of a surprise is just how quickly and extensively the
Internet is replacing traditional content over consumer electronics
devices like TVs and PCs outfitted with media-compatible software and
hardware. Computer makers like Hewlett-Packard (HPQ) and software giants like Microsoft (MSFT) long hoped they’d play a bigger role with so-called media center PCs.

But the Internet entertainment revolution has largely taken a different
path. More consumers are getting amused straight from the Web, right on
the PC. In part, that’s thanks to the proliferation of faster Internet
connections and technologies like wireless fidelity, or Wi-Fi, that
provide all-over access. With a robust, always-on connection,
downloading even the fattest files is less of a chore.

It doesn’t hurt that just about anyone can create their own content and
spread it around the Web like wildfire (see BusinessWeek, 9/26/05, “It’s A Whole New Web”).
YouTube is serving up 100 million videos a day, much of it original
skits, lip-synched numbers, and Web “soap operas” filmed by amateurs at
home. Even getting news and information online has taken on elements of
social networking and entertainment. Consider the success of blogs such
as Gawker, citizen journalism news sites like Digg, and digital
directories like Yelp, where thousands of everyday people write
frequently creative and funny reviews on everything from their
accountants to hot new clubs.

BIG MEDIA MOVES.
Now, big media is responding fast, whether it’s Warner Bros. striking
deals to deliver content via BitTorrent and YouTube or decisions by
Disney’s (DIS) ABC and other providers to post shows online, sell them via Apple’s (AAPL) iTunes, or even make them available early through Netflix (NFLX).
Everywhere you look, new entertainment options are swirling around Web
surfers. Getting online for fun is the most popular activity on the
Web, after sending and receiving e-mail and conducting searches through
engines, according to Pew.

As popular as online entertainment
has become, advertisers have yet to get with the program. eMarketer
will report the week of Sept. 25 that U.S. Internet advertising will
grow more than 33% in 2006 from a year earlier, the fastest pace this
decade. But even with more than $16 billion now spent advertising
online, companies will spend a mere $280 million on social networking
and user-generated content sites. Meanwhile, nearly half of the
spending goes to search-related advertising.

MARKETING LAG.
If advertisers seem too risk-adverse, remember it took nearly a decade
for them to get comfortable with easy, relatively cheap, and measurable
paid-search ads. And only in the last few years have more traditional
banner and display ads, which have more a fuzzy aim, like promoting a
brand, come back into vogue.

Advertising on sites that
specialize in social media and user-generated content is trickier. On
sites such as MySpace, where companies post profiles of fictional
characters or cars, they’re generally tricking or bribing kids to spend
some of their social time getting pitched (see BusinessWeek.com,
9/11/06, “Marketing to Kids Where They Live”).
And success isn’t just getting your name in front of them, it’s getting
the online community buzzing about your product or promotion, turning
them into marketers. Try too hard, and risk getting called out by these
sites’ vocal and sometimes cynical communities. Post a fake profile of
an attractive girl who loves, say, the new Ford (F) Taurus at your own risk, Corporate America.

That’s
a risk that many companies aren’t yet willing to take. Big advertisers
don’t fully appreciate the breadth and depth of the Internet-as-hangout
trend, says David Hallerman, senior analyst at eMarketer. “With all
kinds of Internet advertising, there’s a real lag between the reality
of who the audience is and who companies think it is,” he says. “More
often they lean toward thinking the audience is younger.” So far, the
biggest advertisers to experiment with social media and user-generated
content sites are Hollywood studios and carmakers.

HOW TO ADVERTISE.
Still, ad spending on sites that specialize in social networking and
related activity is set to grow, as such sites attract larger
audiences. eMarketer expects, in the next four years, nearly $2 billion
will be spent on these sites, in an effort to get all those people
hanging out online buzzing about new shows, products, or services.
Boutique agencies are even popping up to specialize in marketing via
the new social media. Ian Schafer was vice-president of new media at
Miramax Films a few years ago and was increasingly looking for ways to
promote new movies via the Web. None of the interactive agencies he
interviewed really got the social networking, user-generated content
phenomenon. So he started his own firm, Deep Focus, to specialize in
using these kinds of sites to build buzz.

He says the keys are
being transparent that a profile page for, say, a TV show is being put
up by that TV show with a vested interest. But, other than that, there
are few rules. One recent campaign for HBO’s series Entourage
had kids on MySpace creating profiles of their own “entourages” and
vying to see who could rack up the most friends. HBO gave the winning
team cars and flew them to Los Angeles to live the life of the show’s
stars for a week.

Another example was a MySpace campaign for the movie Clerks 2. The first 10,000 people to add Clerks 2
as a friend got their names in the film’s credits. Over six hours, more
than 180,000 people befriended the film, and many of them saw it in
theaters just to see their names on the big screen. “To influence them,
we need to understand their behavior online,” Schafer says. “This is
just an extension of social interaction that’s been going on; now it’s
nonstop; and as advertisers and marketers, we need to take advantage of
that.”

The sites themselves are leery of awaking a vocal
uprising if ads are too obnoxious or intrusive. It’s an issue sites
such as Facebook, Digg, and YouTube are still trying to figure out.
They have a potent model in Google (GOOG).
For a long time, the Web search giant had mass users, but lacked a
business model. Then the world caught on to the potential of ads
related to search. Just wait till it grasps what most folks are doing
online now

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