Now that the barrage of 2008 predictions are behind us, we thought we’d take the next couple of weeks to focus on the “realities” behind what some pundits have predicted. This week, we’ll tackle mobile, advertising, and publishing.
Predictions: Online advertising will be resilient in 2008, with growth in online video ads, social networks and targeted advertising generating massive profits for all media.
Reality: As dollars shift from traditional media to online channels, traditional publishers have to start worrying about how to overcome the resulting decline in revenues. The traditional advertising model will be further weakened as Google makes it easier and easier for advertisers to develop their own ads and insert them at the point of persuasion: search results.
Predictions: Mobile marketing will have a banner year in 2008, with increasing numbers of advertisers opting to target consumers via mobile phones. Although mobile banking is still a new kid on the block, it will rapidly approach mainstream status.
Reality: Mobile now is actually a three legged stool – mobile marketing, mobile banking and mobile payments. Stats still show that most people don’t want advertising on their mobile phone in spite of the discovery by advertisers of this new real estate. While most people will do mundane banking tasks via the phone, it remains to be seen how many will actually use their phones to actually transact. Mobile payments is where payments will eventually end up, but not this year - or even the next.
Predictions: As more and more newspapers make the transition to digital, their online revenues will increase and they will continue to capitalize on their main commodity: content. Despite the advent of slick new portable readers, the printed page still remains the medium of choice for most consumers.
Reality: Newspaper profits, in particular, will continue to reel as cost cutting threatens the quality of content which, in turn, perpetuates the death spiral associated with fewer numbers of customers and declining ad revenues. The debate over free versus premium content will rage as consumers rethink the tradeoff between free content and the barrage of ads thrown at them versus a paid/ad-minimalist environment. Online revenues may increase but it will pale in comparision to what they rake in via the traditional channels which is now on a downside slide. New technologies, like Amazon’s Kindle may eventually be the killer app for print as the content delivered via an internet connection becomes the dominant delivery channel.
For more MPD Perspectives on these issues check out:
Survival Tips for Advertising Agencies in the Online World
Mobile a Catalyst for Traditional Media? 2007 CTIA Presentation
Tomorrow’s News Today: 5 Strategies for Survival, IDEAS Magazine
Will Kindle Ignite a Catalytic Reaction? Part 1 and Part 2
Economics of the Blogosphere
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Filed Under: Digital Media, Mobile, Publishing, Internet-Based, Ad-Supported, Software, Payments, Newspaper Publishing, New Business Models, Technology, software platforms, Social Networks, consumers, Search engines