Digital Thoughts: State of the .com Union
by Sam Harrelson
AdTech 04:
SF is coming fast and there is an incredible buzz in the air
in the online marketing sphere. The parties are back,
festive moods seem to abound and there is a general feeling
of good-tidings in the air. Last year’s AdTech: SF was
generally a surprising success. Many veterans who had
become accustomed to the gloom conventions of the previous
two years were met with a joyful exuberance evident on the
exhibition floor, at the many parties and in the deals that
resulted. In many ways, last year’s SF event was a turning
point in the online industry and signaled the dawning of new
optimism.
This year’s
AdTech: SF also has the chance to leave its mark in the
annals of online marketing. Joyfulness still abounds and
media buying is in the air. However, the closing quarter of
2003 saw a dramatic string of events that brought into focus
the industry’s way of doing business and the optimism that
came back to the surface. CAN-SPAM, lawsuits against major
players, steady downturns in industry-wide click thru and
conversion rates, new found vigilance from ISP’s looking to
make a dent in the commercial email world, and consumer
frustrations over spam, spyware and adware were all
challenges and hurdles that online marketers in our space
faced at the end of 2003 and continue to deal with into
2004.
So, it
comes as no surprise that AdTech: SF 2004 represents
something much bigger than a chance to catch up with old
friends, make new business, show off the latest reg path or
frequent every party with an open bar. The event
encapsulates a crux moment for the industry. The mood that
develops in San Fran will certainly carry over into the rest
of the summer and spread throughout the industry by
conference-goers returning home spreading their contagious
virus of optimism, pessimism or cool reserve.
At this
crucial moment, how does the industry stand in general
terms? That depends on who you ask and which sector being
investigated.
Email
Email is
still a steady producer for many companies in the industry.
Although declining open rates, an artificial market price
curve and the continued presence of outside interveners such
as governmental regulations and mis-thought attempts to stem
the damaging flow of spam, there is still a great deal to be
said about email. Companies who do email smartly profit,
those who don't continue to struggle in light of the events
of 2003.
Pop
Despite its
relative high yields and performance, the pop market was
dealt a serious blow by the ubiquitous presence of
"pop-stoppers" offered by every company under the sun.
Microsoft's decision to deal the pop format its death blow
doesn't bode well for the industry either. Consumer
frustrations won out over consumer conversion and it appears
that the pop is going the way of the dodo.
However,
there are many hybrid forms of the pops that operate on
technologies outside the realm of pop-stoppers. Although
frequently used by those in the incredibly diverse and
complicated "adware/spwyare" world, these technologies could
be the spark that revives the pop format for more legit
forms of marketing.
Banners
Banners are
still rapidly declining in industry reputation, conversion
rates and consumer likeability. However, there is hope for
the banner with the still promising realm of rich-media and
similar formats that are user friendly and appealing.
Contextual
Contextual
advertising is the new buzzword. However, it is too early
to determine if the model will have serious long term
staying power or be the mode for less-than-honorable
"marketers" to eek out short term profits.
Search
We've hit
on search many times in the Confidential. Past issues are
going to give the best outlook on the future of this
sector. However, with Google going public and the continued
rise of the search star, it is certain that it will change
the way online marketing is done even more than it already
has. Optimization, automation, and consumer friendliness
make this format attractive for a long time to come.
Registration Path
The reg
path sector will be looked at in the Trends Report article
in this week's Confidential, but it's important to note its
place in the wider industry and the potential for its
future. Automation is a key selling point as is the vast
amount of traffic and conversions capable of being
produced. In one of the oldest sectors there is still a
great deal of potential and that says a good deal about the
industry at large!
See you in
San Francisco next week!
Sam Harrelson
is the Co-Editor of the Digital Moses Confidential. Send comments and questions
to sam@digitalmoses.com
