11 tech & media trends for brands in 2011

From the excellent Dan Calladine, some ideas for brands in the coming months... 

The world is changing rapidly and media is at the heart of these changes. Changes predicted a few years ago have happened, including mobile ‘arriving’, the ubiquity of social media and online video; in the light of this 2011 will be a year of consolidating on these gains and refining techniques in the new landscape.

1 – Monetisation 

Facebook will start to make lots and lots of money.  Facebook say they’ve only really made enough ‘to keep the lights on’ so far, but once they really start the money will come flooding in. Through deals with partners like Paypal they can take a percentage of transactions, and with more and more things sold on the site, this will soon amount to billions. Other media owners will do longer term and deeper deals with brands on more of a revenue share model – for example a permanent position on the site paid for by a share of sales, rather than by impressions or clicks.

Entertainment companies will continue to prosper, but the big winners will be companies that take micropayments – for example a small amount to download an extra level of a game, or sell a virtual item that makes the game easier, like the tractors in Farmville. Mobile game companies like Rovio have made millions from downloads of games like Angry Birds for less than €1. However at the same time a few big, expensive blockbusters like Call of Duty will also break records.

Implications for brands – Think about what you have that can be sold, and the ways in which you sell.  Can you sell directly, or through channels like Facebook and the app stores?  Do deals to make sure that you sell in the best environments.

2 - More Advertising

Advertising will continue to be a major source of revenue – for some.  This year we’ve seen new ad formats on YouTube – currently over 2bn videos views are being monetised each week – and also banners appearing for the first time in Google search results (albeit just for image searches so far). 

Within ‘advertising’ we also include content that appears on media for payment.  For example Twitter is introducing new ad formats, and other publishers are pushing the boundaries of what they will feature on their sites for payment, and how closely they are willing to let brands integrate with their content.  It’s not just online either – there’s lots of innovation in outdoor media, with more electronic and digital ad formats on the high street. Even graffiti is being used to promote brands in some places.

Implications for brands – Advertising isn’t going away, but it is changing, particularly with the rise of branded content.  Develop strategies to produce and place this, as part of your media & marketing schedules

3 – Partnerships and Sponsorships

Brands want to get closer to content and to technology, and more will be paying to integrate and sponsor, rather than to simply advertise.  There have been so many examples of this in 2010, including Lemsip sponsoring a selection of Films on Demand on LoveFilm in the UK, and RedBull sponsoring a film by cyclist Danny McAskill. Bands like Weezer, OK Go and Faithless have been willing to do partnerships with brands to help pay for their music. We’ll see more long term deals with publishers for sponsored content and sections as part of a larger advertising deal, and, as mentioned above, media owners taking content from eCommerce sites on a revenue share model, rather than as straight advertising.  Media owners will also offer up their data for partners to use, as is already happening with The Guardian’s Open Data Partnership.

Implications for brands – Look to form strategic long term deals with suppliers that best fit your audiences and objectives

4 – Targeting, Data, Algorithms & Location

All digital marketing activity generates lots of measurable data, and 2011 will see more focus than ever on testing and refining to get better results  in paid media, owned media (brand websites) and earned media (social interaction).  Targeting will bring addressability – the ability to target and re-target small groups of people and individuals.  There will also be more focus on path to purchase and smoothing out the online shopping experience.  It’s harder to increase your conversion rate than to increase your ad-spend, but it’s cheaper.

Algorithms will continue to develop, not just for search, but for location-based and social media, for example in recommendations based on what similar people and friends like.  Search is great when you know what you’re looking for; if you want a recommendation for something you never knew existed, it isn’t.  Data from a location based service like Foursquare could give us a much better set of recommendations for a week in New York than a guide book.

Implications for brands Assess the data that is currently generated, and prioritise based on how well it relates to your objectives.  Focus more on measuring the most relevant, and develop tools to be able analyse these more easily.  Make sure that you experiment with new algorithms and companies that are looking at 3rd party data, particularly in social and location to try to integrate into your own data.

5 – Asian Influence

Asia will have a greater influence on the media world, both in terms of numbers, but also in ideas and business practices.  There are now over 420m people online in China, nearly 900m mobile subscriptions (including 39m 3G customers), and 175m cable TV subscribers.  Sites like Tencent are far more profitable than Western social networks through virtual goods sales, and Japanese social network Mixi delivers 84% of page impressions to mobile users. 

Western companies are trying to learn from Asia, and at the same time the web is becoming a lot more universal because it’s becoming much more visual – witness the success of mainly visual blogging platforms like Tumblr – and new visual search technologies, and this will reduce the differences between what the West sees and what Asia sees.  Finally, the group buying (Groupon) idea originated in China, as ‘tuangou’ a few years before it took off in the West.

Implications for brands – Think more visually, and try to make communications more accessible to people of all languages.  Keep an eye on developments in Asia, and try to borrow or re-apply the best ideas.

6 – Technology for self improvement

Just as food marketing took things like vitamins out of the bathroom cabinet and into the kitchen, technology will take health checks, fitness tracking and education into the living areas of the home.  Mobile apps allow people to measure their fitness and progress towards goals; for example Sleep Cycle plots your sleep patterns, and wakes you up at the best time in the cycle.  Adidas’ miCoach acts as a personal trainer.  Gaming mechanisms have been built into some apps to encourage competition, and make the process fun.

Implications for brands – Work out if self improvement and measurement is relevant to what you do, and if so try to get involved.  However only do it if you can do it well, and do something that is different to things already out there.

7 – New companies

The speed of change, and the speed that information spreads, mean that if anyone has a really good idea for a business or service it can grow very quickly. Instagram came from nowhere to 1 million users in 10 weeks. Tumblr has grown to over 11m users in 3 years, mobile developer Quest Visual achieved instant fame with the release of it’s translation app Word Lens, and and coupon service Groupon has over 200 different sites in over 30 countries in two years. The reported $6bn valuation for Groupon will inspire lots of others, and lead lots of investors to risk money on relatively conceptual start-ups. 

Implications for brands – Monitor new technologies, and try to get in touch with the most relevant new companies with a view to testing on projects

8 – Streaming rather than downloading

The US now sees almost as much music streaming as downloading, and the popularity of services like Spotify in Europe are also increasing the popularity of the idea of not having to own music.  YouTube also supports this trend – many teens use YouTube as a music player, queuing up tracks for when friends come around.  In the US Netflix predict that customers will watch more video streamed in Q4 2010 than on DVD.

Implications for brands – The move to streaming changes the media landscape, so make sure that your content is available, and your messages are being seen by streamers as well as downloaders

9 - Brands will be more ‘human’

Brands will adopt more human traits as they try to communicate and connect with people through increasingly social channels.  Within advertising characters have always been created to personify the brand, but now more brands will try to get their own personality and try to do more human things like arranging games (Cadbury) or organising parties (Smirnoff).  This will be particularly true for FMCG / CPG brands, as they refine how they act within the social space and try to give themselves likeable personalities.

Implications for brands – Make the brand more ‘human’!  Build on its existing personality, but extrapolate human traits.  View this as a long term commitment

10 – The internet will become more automated

There may be now more machines than people connected to the internet than people.  Machines send regular messages to other machines, for example busses on transport networks providing their location, or weather sensors constantly checking in to update on conditions.  Soon analysis of this data will produce new services and efficiency savings – but people won’t need to be involved.

Implications for brands – Is there any machine data generated by the brand’s processes that could be of general interest, and could be shared?  If so, share it!

11 – Celebrity

The power of celebrity will rise.  Celebs have now been freed from the studio or label system by Facebook and twitter, and now interact directly with fans, who can act on their endorsements.  Sean ‘P Diddy’ Combs’ involvement raised sales more than trebled sales of Ciroc Vodka in 2 years through his endorsements.  Lady Gaga has multiple sponsors placing products in her videos, and has an official role with Polaroid.  Celebrity endorsement isn’t a new thing, but it’s easier for the individuals to deal directly with the companies and be more involved in the process. 

There will also be more micro-celebrities (‘Famous for 15 people’) and they will also become more powerful and influential.  The media will start to employ writers and photographers on the basis of their networks – that is, the size of the audience that they can bring with them.

Implications for brands – Decide whether this is appropriate for the brand, and if so investigate who the right sorts of celebrities would be.  Start small, learn, and build on success.