P&G, Others Build Mobile-Marketing Budgets

Could Be Signal That Medium Is 'Out of Trial Mode'

By Alice Z. Cuneo

Published: November 29, 2006

LOS ANGELES (AdAge.com) -- Procter & Gamble, Microsoft Corp. and other major marketers have set aside a piece of their ad budgets -- albeit a small piece -- for mobile marketing, representing a "significant shift" for the emerging medium.

Major marketers are beginning to take third-screen media seriously as a potential advertising venue.

Mainstream now
Any money put toward mobile ad platforms last year came from marketers' discretionary funds, but now mobile marketing is a dedicated line item in their budgets, Jay Emmit, president of the Americas, mBlox, a global mobile transaction firm, told some 400 attendees at the 2006 Mobile Marketing Forum.

"It's a significant shift in the advertising world -- [mobile marketing is] now mainstream; it's out of trial mode," he said.

The banking and financial sectors were responsible for some of the more innovative uses of the emerging medium in the past year, as when MasterCard used text messaging as part of its fraud-alert program. P&G, which won the Mobile Marketing Association's first Overall Excellence award, has developed the Ad Lab, a program where key marketing executives on more than a dozen brands have been educated in mobile opportunities such as mobile video and text messaging. As a result, a flurry of new efforts and programs will be rolling out from P&G brands starting next year.

Lingering issues
Still, mobile marketing continues to have its hangups, Mr. Emmitt said. Mobile companies don't have a foolproof method of ensuring that ads for sexually explicit material, gambling and other adult-aimed content will stay off cellphones in the hands of kids. Wireless carriers led by Sprint have begun to warm up to providing marketers with targeted mobile advertising opportunities, a move than may not find fans with privacy advocates.

Marketers and agencies are also demanding better measurement tools. "I want data," said Eric Bader, senior VP-digital at MediaVest. There's "not a lot of 'M' in the CPM," meaning there's not a lot of mobile included in ad rates determined by cost-per-thousand (CPM) consumers. Another stumbling block to mobile marketing's success is the inability of marketers and media buyers to buy ads across carriers: In the current setup, ads with each wireless service provider need to be negotiated individually.

Kim Olson, marketing director, Sprint Mobile Media Network, said marketers need to present strong, compelling mobile offers, "not just put a logo up." She declined to answer a question from the audience on the carrier's share of ad revenue.

Not so fast
Not all attendees were convinced that mobile has turned the corner. Courtney Jane Acuff, associate director, Denuo, said many marketers have not made a commitment to an interactive budget, let alone a mobile-marketing budget. "There's a big difference between a discretionary budget and an actual budgeted dollar," she said. Ms. Acuff added that next year, when the 2008 broadcast TV "upfront" ad-selling period is conducted, she will watch to see if mobile is included as part of the offerings. That "will dictate whether mobile is happening or not," she said. "It didn't happen this year."

A study this month from JupiterResearch found 22% of companies advertising online also are doing mobile marketing. Overall, the study predicted mobile ad spending to more than double from a predicted $1.4 billion this year to $2.9 billion in 2011.

A number of the conference's attendees, particularly those representing the wireless carriers, noted the fragile nature of mobile marketing in light of the threat that comes from unscrupulous marketers, such as spammers. "Those in it for the short term: We will find you all and kick you out and never see you again," said Christopher Black, director-mobile marketing and interactive media, Cingular Wireless.

And one conference speaker had some old-fashioned advice based on lessons learned from the internet's growing pains. "Pop-ups -- don't do it," cautioned Greg Stuart, president-CEO, Interactive Advertising Bureau. "Don't let it happen."

Handy Group set to form "deep links" with several national airlines both in the UK and US


The market is "slow to see mobile Internet as a serious channel" and there is
"lack of 'sexy' content". These forthright opinions were put forward by Michael
Lacy, chief executive officer, Handy Group (UK) Ltd during the last year's
Travel Distribution Technology held in London in November last year

A year later, as EyeforTravel.com's Ritesh Gupta again got in touch with Lacy
to check on how the situation has changed, he says, "Yes, 12 months ago we were
pushing on locked doors and getting the response 'lets wait until mobile
develops as a serious channel'. Today, as Handy, we are being welcomed as the
leaders in the field and there's no doubt that all the major players are
developing a mobile strategy and are more than keen to talk and learn from
us."

Last year, referring to user profile and trends, he stated that the data
retail market is dominated by male 15-19 year olds for tones, music,
videoclips, soft-porn etc. Also, handsets were patchy with more than 100 types,
and 3G is getting there.

"Those 15-19 years olds are now a year older for a start and looking at more
serious content. However these products still dominate the world of mobile
transactions but mature products are at last making headway. To a large extent
this is strengthened by the forward thinking approach of networks such as O2
with i-mode which has 50 million subscribers worldwide. HandyTraveller our
mobile travel portal is on i-mode in the UK and Ireland and will launch with
the other European i-mode operators from December," he says.

The company is set to launch the second phase of its product line-up which
features 'global' product allowing it to partner with any mobile network in the
world and have relevant product to that market.

"We have both deep links and intermediary feeds with low cost airlines and
last-minute rate hotels servicing more than 50 countries with 600 points of
origin and destination. We are soon to announce partner status with one of the
worlds largest car rental suppliers and deep links with several national
airlines both in the UK and US," he says.

The technology the company utilises to provide the HandyTraveller service both
as a web-based travel portal and as a mobile phone based portal is available to
business partners as a 'white label' product.

Lacy acknowledges that this service has been very well received, particularly
so in the last four months.
"We plan to launch five services on behalf of white-label clients in the first
half of '07 but am bound by contract not to say who. What we do is really
specialised, keeping up with all the latest handsets and software releases,
making complex browse and book services useable on a mobile phone and keeping
the transfer of data compressed to make it both fast and secure is not easy. It
makes much more sense for company to contract with Handy to build their service
- for one thing they know it'll work because HandyTraveller proves it."

PDAs are increasingly being thought of as computer platforms which can run
software applications, through which travel content can be sold.

On new platforms becoming a viable distribution channel, he says, "Only in the
same way a mobile can. To view a full size site on a PDA is still a terrible
user experience. We have a mobile xHTML site optimised for PDA's that makes
really good use of Windows Mobile and Pocket PC. We strongly feel that Travel
like many other products are best sold over browser based services rather than
a user having to download a software application which is why we utilise WML,
xHTML and cHTML. We detect the level of the browser installed on any handset
accessing our service and supply the most appropriate site for the users phone
or PDA that will correctly render for the screen size and installed operating
system."

"Handy Group is developing a hugely powerful CRM that handles all these added
features - with GIS and particularly the cross boundary GIS services to be made
available from the European Galileo system, we not only will know who is
accessing our services but where they are at the time and with the ability to
instantly push context sensitive deals back to them on a device from which they
can instantly buy," says Lacy.

On future projections, he says, "There are many exciting things we can do with
the mobile device but ultimately it will come down to what the consumer wants to
do with it. Our job is to make sure it works, to innovate for the benefit of the
consumer and to ensure the customer interface and experience is exceptional. By
doing so, this will determine just how far we can go. Undoubtedly the very
least mobile will give us is the ability to buy internet products whenever and
wherever we may be, at the most our mobiles will become the single device we
use to manage our lives."

Mobile technology gains momentum for travel


Interest in mobile technology is increasing as operators and airlines explore the potential of the medium for travel purchases.

O2 product manager for travel Nancy Lyndhurst said large travel players such as Cathay Pacific, Accor Hotels and KLM are already showing success with mobile technology.

She also drew on the experience of Japan where one major airline generates 5% of sales through mobile technology while a leading travel agent in the country sees one booking on mobile technology for every five bookings on the fixed internet.

Despite the growing interest in the medium Lyndhurst said mobile technology would not replace the internet.

"Mobile is content snacking. It's there to give us the information when we are not near the internet."

Lyndhurst also provided some statistics on UK usage with about 25 million people browsing on their mobiles.

"There are about 60,000 users a day looking at train times on their telephones. Lastminute had someone book a £3,000 holiday through their telephone. The key point is that people are interested and they are looking at it. It's so easy and you can be so targeted with it."

She also commented that transaction rates were still low because of the perceived security issue and because mobile phone transactions have been the reserve of the younger generation up to now.

Internet Advertising Bureau chief executive Guy Phillipson added that navigation was also still a problem but that the medium is well set up for payments because of people purchasing ringtones.

02 runs runs the i-mode platform which includes travel customers such as lastminute.com and Handy Traveller.
Source: Travelmole.com

Mobile Users Like ESPN, Weather

Mobile users have a much greater propensity to access sports and weather websites like ESPN and AccuWeather than PC users, however, the results for search giants Google and Yahoo are exactly the opposite. The news is part of comScore and Telephia’s new “Mobile Web Metrix” which compares mobile and personal computer usage.

by Kristina Knight

“The first results from MobileWeb Metrix highlight the value of evaluating a Web property’s performance among both the mobile and the PC audiences,” said Kanishka Agarwal, VP of New Products, Telephia in a prepared statement.

According to the results, The Weather Channel and ESPN have the highest mobile reach with 22.1% and 17.9% respectively.

"Sports is an especially powerful category in mobile, along with weather and news, because they really lend themselves to getting quick snippets of information," said Agarwal (via MediaPost).

Yahoo Weather and AccuWeather each also had a mobile reach that outpaced PC reach. All of the sites saw mobile-to-PC index scores over 120 which indicates a far stronger mobile than PC showing.

Search platforms, on the other hand, showed the opposite. Both Google (13.0%) and Yahoo (11.1%) search platforms scored well under 120, which indicates a much stronger following via traditional computers than mobile devices.

Email platforms also seem to be more popular among traditional PC users. Of the leading email applications, Gmail was the only email provider that showed a higher mobile index rate (6.7% mobile vs. 5.6% PC) . Yahoo (29.4% mobile), HotMail (15.3% mobile) and AOL (13.7% mobile) were all under the 120 index score mark.

According to a new report from JupiterResearch, “US Travel Forecast: 2006-2011,” online travel revenues will reach $128 billion in the US in 2011 - 38% of all travel revenue for that year.

“Online travel revenue will continue to grow strongly from $85 billion in 2006,” said Jupiter analyst Diane Clarkson. “Factors that will spur online spending are greater consumer wallet share, increasingly sophisticated products available online and improved online compliance in business travel.”

For comparison, eMarketer’s estimate of this year’s US online travel sales is somewhat more conservative at $77.7 million. comScore Networks put first-half 2006 online travel sales at $34.7 million, a year-over-year increase of 14.7%.

While the exact figures may not match, all the sources agree that online travel sales are continuing to fly higher.

Google's ambitions going mobile

By Marguerite Reardon
http://news.com.com/Googles+ambitions+going+mobile/2008-1039_3-6138755.html

Google--the premier online company in the traditional Internet world--has for the past year been focusing its attention on the mobile market.

The company has steadily introduced new services designed specifically for the small screen. In January, it released the Google Personalized Home, which lets people access Gmail, news, RSS feeds and other information from their personalized Google home page on mobile phones and PDAs. The service is free in the U.S. and works with any phone that contains an XHTML-capable Web browser.

This summer it launched a downloadable Java application for Google Maps, enabling cell phone users to get information about local restaurants and movies theaters as well as live traffic information on the map.

And this month, it improved its mobile Gmail client to allow quicker access to the application. At the same time, Google has been busy developing partnerships with mobile operators, such as Sprint Nextel and Cingular Wireless. It's also been testing new business models, like text-based mobile advertising, and more localized advertising.

With nearly 3 billion mobile phone subscribers in the world expected by the end of 2007, Google sees great potential for extending its presence throughout the world using the mobile platform, said Deep Nishar, director of product management for Google. CNET News.com recently chatted with Nishar by phone from his office in California to get the scoop on the company's mobile strategy and to get some insight as to how the emerging mobile market might evolve in the next couple of years.

Q: Google has been making a lot of mobile announcements lately. What exactly is the company's strategy when it comes to the mobile market?
Nishar: Our strategy is predicated on three things. The first is that mobile devices are very personal. People carry them wherever they go. And unlike the home PC, people don't share their mobile phones. So it's very important to make the service very personalized.

That's why we've launched Google Personalized Home and mobile Gmail. So people can get this data on their mobile phones all in one place without going to a bunch of different sites.

The second big category we are focusing on is location-based services. People take their cell phones with them everywhere, and they generally are looking for information in the context of a location. When you're on your mobile device and you type in the keyword "movie," you're likely searching for a movie theater because you want to go see a movie. But if you typed in "movie" on your desktop at home, you may be searching for more general information about movies. With Google Maps, we can show you the location of the nearest movie theater, the times of the shows, and even let you purchase tickets from your phone.
Given that our mission is to organize the world's information, it's important to make sure our applications work everywhere in the world.

But right now, users have to type in their location or a ZIP code, right?
Yes, but the next step is to interact with advanced cell phone technology, like Global Positioning Systems or GPS, so that the device knows where you are. We're already doing that with Helio's new phones. The whole point is to make the user's life simpler.

What's the third piece of the strategy?
In mobile, a one-size-fits-all solution won't work. Given that our mission is to organize the world's information, it's important to make sure our applications work everywhere in the world. But you can't assume that products popular in one region will be popular everywhere.

SMS is a good example. It's very popular in Europe and is gaining popularity in the U.S. But people in Japan don't use SMS; they use mobile e-mail. So it wouldn't make sense to launch an SMS-based search application there because people won't use it. So we need to make sure our services can be accessed globally, but the product execution is local.

So how does Google expect to make money from the new mobile applications it's developing?
We are already testing text-based mobile advertising in Japan and several other countries. And so far the testing is going quite well. So that's one avenue for us to make money. But I think that mobile is still a new medium. The number of people accessing data applications on phones is still relatively low. As usage increases, I am certain there will be other business models that emerge.

Eric Schmidt, Google's CEO, said earlier this month that he believes mobile advertising could make cell phones free for consumers. How would that work exactly?
What Eric was alluding to is that it's in the best interest of mobile operators, content developers and application providers like us, to make sure that everyone who wants a mobile device has one. Unlike the traditional Internet, the mobile market is based on a well-defined ecosystem. Mobile operators set pricing on content and provide access. Device makers select operating systems. And then you have service providers like Google that offer applications.

So the entire ecosystem will have to figure out different ways to get mobile devices into users' hands. It won't be just mobile advertising. But the market is still nascent, so we don't know what it will be yet.

Google's success in mobile relies on the consumer's willingness to adopt and use the mobile Internet. So far, relatively few people are surfing the Net on their phones. Why do you think the mobile Internet has been slow to catch on?
Growth of the mobile Internet has been different in different parts of the world. And I think we can look at the differences in business models to understand why it's popular in some places and not in others.

For example, in Japan, data usage is very high compared to other places like the U.S. If you dig deeper, you find that the business models aren't as open in the U.S. as in Japan. Phones in the U.S. are still primarily used for voice calls. But I haven't seen voice minutes priced any higher here. I think the mobile operators understand this, and they are looking for new ways to encourage use.

What do the mobile operators and others in the mobile "ecosystem" need to do to spur adoption?
We need to define the real value of what we're offering consumers. Data services aren't just about getting the latest ring tone. That's entertainment and doesn't become a core part of a user's life. When I show friends and family the things you can do with Google Maps, like live traffic updates, they are like, "Wow." We need to make sure more people have these "aha" moments.

Do you think that pricing is affecting adoption of these services?
Price is something that always lingers in consumers' minds. There have been studies that show when data is offered for free as part of a trial that 50 percent to 80 percent of users stop using the service once they have to pay for it. But I think that users pay for what they value.
Data services aren't just about getting the latest ring tone. That's entertainment and doesn't become a core part of a user's life.

For instance, I don't think you can get people in Western societies to pay for news headlines. On average, most people are within 30 to 40 minutes from some kind of technology that delivers the news for free. So you're going to be hard-pressed to get people to pay for it.

So I think that service providers need to be smart about how they price content and services. You can't charge for every bit of content. But you can charge for things that provide a real value to consumers.

I agree with you on that point. But one of the reasons I'm not a big mobile Internet user is because I don't really understand the carrier's pricing method. And I'm nervous I'm going to be charged an arm and leg for just experimenting and trying new services. Do you think that's also pretty common?
Yes, I do. There are two hurdles operators must overcome. First they have to make consumers understand the value of the service, so they're willing to pay a fee for using it. And then they also have to provide transparency in pricing. This is a distinction that not many people understand.

Most consumers understand they are being charged for the use of a data service. But they don’t really know how much. Mobile operators are starting to recognize this, and they are coming up with more simplified pricing structures.
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Google has announced partnerships with several carriers. But all of Google's mobile applications can also be accessed directly from the mobile Internet. Has that created tension between Google and mobile operators, who are reluctant to give up control over what applications their subscribers are using?
In general, I think whenever a new service comes onto the market and a new way of doing business emerges, mobile operators question how it will play out. We've experienced a lot of good will among mobile operators that we've worked with. But I admit that some of the discussions were difficult at first. But at the end of the day, the operators are smart people. And they know which way the market is going. They have to look at us as a partner to enable these new services and a wave of new innovation.

So what's next for Google in the mobile market?
I can't share specific details with you about products we haven't announced. But I think if you look at our strategy, several obvious things fall out. For example, I think you'll see us do more with location-based services, like developing more locally flavored products.

Will 2007 be the year of mobile for Google?
I think that 2006 has already been year of mobile. We really started investing in mobile in the latter part of 2005. And we're already seeing the fruits of some of that labor. In 2007, we really hope to keep innovation chugging along and provide some great new products.


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Serious consumer distrust of e-mail
November 28, 2006

E-commerce sales have experienced consistent revenue increases. However, recent security breaches (online and offline) are having a significant impact on buying patterns of U.S. adults. Due to consumer’s concerns about the security of the Internet, nearly $2 billion in U.S. e-commerce sales will be lost in 2006, according to a survey by Gartner, Inc.

According to the Gartner survey of 5,000 online U.S. adults in August 2006, approximately $913 million in 2006 e-commerce sales is lost because of security concerns among online shoppers. Another $1 billion is lost because of shoppers who refuse to shop online because of security concerns.

Nearly half of online U.S. adults, or 46% of more than 155 million people, say that concerns about theft of information, data breaches or Internet-based attacks have affected their purchasing payment, online transaction or e-mail behavior. Of all the behaviors affected, online commerce (including online banking, online payments and online shopping) is suffering the highest toll.

Gartner estimates that these security concerns have kept approximately 33 million U.S. adults from banking online. According to the survey, nearly 9 million U.S. adults have stopped online banking altogether, while another estimated 23.7 million won’t start because of their security concerns.

Perhaps the biggest impact is a newfound and serious consumer distrust of e-mail. Nearly 70% of online consumers whose behavior has been affected by recent security incidents say that their concerns have affected their trust in e-mail from companies or individuals they don’t know personally. Of these, more than 85% delete suspect mail without opening it.

Firms give texting a thumbs-up

Want info on real estate, news or the local scene? Companies are gobbling up text-message codes to cash in on the craze.

By Andy Vuong
Denver Post Staff Writer


Clarion Ventures is working on a service to let cellphone users receive information by text message about a house for sale. (US Capital)

Cellphone users are going text crazy, and companies are rushing to secure short codes that underlie the text-messaging industry.

The trend is drawing comparisons to the Internet domain-name blitz during the dot-com boom.

Here's how it works: Companies register five- or six-digit codes - which often form a word using the letters on each number - with the Common Short Code Administration, an organization run by the wireless industry's trade group.

For example, to receive sports alerts from ESPN, cellphone users send a text message to the code 4ESPN (43776).

The cost to register a code ranges from $500 to $1,000 a month, which makes it cost-prohibitive for speculators to tie up a bunch of codes with hopes of reselling them for a profit - a tactic that was widely used during the scramble for domain names.

Early adopters have tied the short codes to a commercial or television show, allowing viewers to send a text message to a code to cast a vote, buy a ringtone or receive news alerts.

"It's kind of the ultimate in direct- response marketing," said local entrepreneur Brian Levin, who helped kick-start the trend through his work with the TV show "American Idol."

Levin's previous company, Mobliss, which he sold in 2004 for $15 million, enabled "American Idol" to receive votes from viewers via text messages.

Text messaging has surged since 2003, when messages were first able to travel between the various wireless carriers, such as T-Mobile and Cingular. Before the change, messages sent from a carrier like T-Mobile were restricted to T-Mobile customers. Boulder-based Mobile Marketing Association led the "cross-carrier" push.

In June, cellphone users sent 12.5 billion text messages, up 71 percent from 7.3 billion in June 2005, according to industry trade group Cellular Telecommunications Industry Association, or CTIA.

Text messaging generates billions of dollars in revenue annually for wireless carriers, which typically charge users a flat monthly fee or 10 cents per message.

Some third-party companies - such as ringtone provider Jamster - make money by charging users a premium fee on top of the carrier's fee.

Text HOUSE for info

Locally, several companies are joining the fray.

Denver-based Clarion Ventures has registered the short codes HOUSE (46873), 4SALE (47253) and TICKET (842538).

The company hopes to launch its first service in January with the HOUSE code targeted at homebuyers.

People who send a text to HOUSE with the address of a home that is for sale in the body of the text message will receive a response that includes information about the house.

The information will include an estimated value, square footage, the number of bedrooms and bathrooms and the year it was built.

"We're going to provide the ability for individuals to get the key information on a house anywhere in the United States," said Craig Harrison, a partner with Denver-based US Capital, the lead investor in Clarion.

The service will be free for users. But they'll have to opt-in, thereby allowing Clarion and its real-estate partners to contact them after they've made an inquiry.

"We're going to be deriving our revenue primarily through lead generation and advertising," Harrison said.

The company also hopes to allow users to buy tickets to events with its TICKET code.

Denver-based Connectme360 is targeting the hotel industry with its code 5STRZ (57879).

Essentially, the company's service will allow hotel customers to receive information about the city they are visiting, such as the nearest sushi restaurant, by sending a message to 5STRZ. The company hopes to launch the service in the coming weeks, said chief executive Brian Hayashi.

Levin, the founder of Mobliss, has launched a new company called Useful Networks that is developing a service that would allow companies to send news, coupons and other information to users based on their location. Users would also have to opt-in for that service.

James Eberhard, who founded Denver-based ringtone company 9 Squared, said short codes will eventually be paired with Internet Web addresses on billboards and other marketing materials.

"The next generation is you'll see 'Go to this website or text this to this,' said Eberhard, now chairman of Denver-based Mobile Accord, which provides the back-end services for companies like Clarion.

Newspapers join fray

Mobile Accord is working with the United Way to allow users to send a text message to make a donation, which will be charged to their cellphone bill.

Mobile Accord is also working on a text-messaging initiative with the Denver Newspaper Agency, which handles the business operations for The Denver Post and Rocky Mountain News.

The DNA has secured the code DENVER (336837) and plans to launch a mobile-coupon service in January, said Sara Pacheco, senior interactive producer with the DNA. The company also has plans to use the code for voting polls and breaking- news alerts from The Post and News.

While the text-messaging boom is generating plenty of revenue for the carriers, some analysts question whether third- party companies will be able to get a bigger piece of the pie in the future.

"How much elasticity is there among consumers to spend for these kinds of things?" said Charles Golvin, an analyst with Forrester Research. "There are lots of instances where consumers definitely will pay. But there are not going to be that many players who hit the jackpot with a big service that has really wide adoption across consumers."

Text Messaging Record Falls Again

Figures released by the Mobile Data Association (MDA) show that 3.8 billion text messages were sent in the UK during October. The total is 100 million up on the previous record, achieved in September this year, and up almost 27 % on the total for October 2005.

The MDA suggests that the nation’s texters will have plenty to keep their texting fingers busy in the run-up to Christmas. Apart from gossiping about the latest goings-on in the ‘I’m a Celebrity…’ jungle or the 'X-Factor' studio, the MDA says text messaging will prove invaluable over the festive period for arranging parties and suggesting presents.

Waitrose is offering text messaging ingredients to consumers’ mobiles for Christmas recipes, which can be used as a reminder while out shopping. Father Christmas is also getting in on the act. Mobile users can sign up on Santa’s website for 3 ‘Merry Textmas Messages’ to let the kids know, for example, that he has left the North
Pole on schedule, or of any delays that might slow his journey.

For the past seven years the MDA’s messaging website, Text.it has witnessed text messaging grow from a popular craze to becoming second nature as an essential communications tool for mobile phone users. The full statistics of this text message explosion and monthly figure releases can be found here.

Nonstop Growth for Online Travel

According to a new report from JupiterResearch, "US Travel Forecast: 2006-2011," online travel revenues will reach $128 billion in the US in 2011 — 38% of all travel revenue for that year.

"Online travel revenue will continue to grow strongly from $85 billion in 2006," said Jupiter analyst Diane Clarkson. "Factors that will spur online spending are greater consumer wallet share, increasingly sophisticated products available online and improved online compliance in business travel."

For comparison, eMarketer's estimate of this year's US online travel sales is somewhat more conservative at $77.7 million.

comScore Networks put first-half 2006 online travel sales at $34.7 million, a year-over-year increase of 14.7%.

While the exact figures may not match, all the sources agree that online travel sales are continuing to fly higher.

Speaking of flying, looking at airline travel sales alone, Jupiter asserts that higher fares and an increase in the number of people flying are driving total air revenues to $138 billion in 2006, with $49 billion spent online, and forecasts that that figure will grow to $72 billion in 2011.

Hotels are also seeing — and will continue to see — a shift to online sales as more travelers migrate from making reservations by phone to online, particularly the hotels' own Web sites.

Security seal lifts Opodo sales

Online travel agent Opodo says its sales have risen 10 per cent in just one week after posting a VeriSign Secured Seal on the payment pages of its web site.

The seal is a small symbol put on transactional web pages to assure shoppers that the site has adequate security and their financial details are encrypted.

Warren Jonas, head of service management at Opodo, says the company has clearly seen that confidence is a crucial issue for online shoppers.

‘Completed sales rose by about 10 per cent when we posted the VeriSign Secured Seal, and we immediately realised the impact that trust can have on shopping basket abandonment,’ he said.

‘We have now published the seal on all the payment pages across our European network.’

A survey commissioned by VeriSign and conducted by TNS Research shows that security concerns have led to 54 per cent of online shoppers abandoning a transaction. And 72 per cent of those shoppers said they would have continued with the purchase had the site displayed a trusted seal or mark.

Online retail body the Interactive Media in Retail Group (IMRG) forecasts UK online sales of £7bn in the run-up to Christmas, but says this figure could be significantly lower if consumers bypass the web because of their security concerns.

As well as the pressure this puts on ecommerce, IMRG’s figures show that 57 per cent of UK online shoppers believe responsibility for protecting their personal information lies with the site they are shopping on.

Avivah Litan, vice president and research director at analyst Gartner, says she is surprised the seal made such a difference to consumer confidence in Opodo’s case. ‘I find that increase very unusual,’ she said.

‘Research shows that even when you put green borders around the edge of a site to show it is secure, consumers miss it about 40 per cent of the time.’

But most online retailers want to provide some kind of quality seal, says Litan.

‘Other internet retailers want to provide this option but it requires education for people to recognise the seals,’ she said.

Customer Intimacy Is King
11/22/2006
By Glenn Haussman

With all the brouhaha regarding the growing importance of customer relationship management (CRM), too many hotel companies are still vexed when it comes down to delivering on a service promise. For hotel companies looking to differentiate themselves from the competition, exceeding guest expectations is paramount since it leads to building loyalty.

In this complex era, it is crucial to truly understand and anticipate guest desires in order to fulfill that service promise. But just how to do it effectively has been an elusive and vague notion not fully grasped by many hoteliers.

Last week ,the HSMAI hosted an on online seminar (né, webinar) as part its continuing HSMAI University series that dug deep into this complex topic. The program, dubbed “Customer Intimacy: The Key to Profitability” demystified this issue and gave attendees some surefire tactics to turn customers into loyal clientele.

“I truly believe hotel companies need to be in the customer intimacy business. They have to focus on delivering what the customer wants,” said Caryl Helsel Partner, inspire resources, a Hospitality Consulting Firm. “You have to have some product leadership to deliver on customer intimacy but you have to focus on the relationship above all else. All goals should be focused on customers rather than the product or operations.”

And getting those loyal relationships are paramount to the property or brand’s success. Helsel said that 10 percent of all hotel guests account for 44 percent of all hotel nights.

To get those loyal customers, Helsel said it’s crucial a hotel employ a culture of managing the “total customer experience” and also embrace a culture of managing “moments of truth” when that experience is on the line. Also, property leadership should demand a culture that puts the customer at the “center of your world.”

Helsel believes that while a hotelier doesn’t have direct control over what someone says after they walk out, it’s very possible to control the guest experience in such a way that they leave with only positive thoughts. “Customer intimacy is essential for success in today’s world,” said Helsel. “If people don’t feel welcome and have an emotional connection, their loyalty will be in question.”

It’s also a matter of creating emotional loyalty rather than functional loyalty. Whereas functional loyalty comes into play if a hotel is conveniently located near an airport, for example, emotional loyalty transcends pure need and promotes frequent stays because the experience moves beyond the brand attributes to an attachment to the guest’s psyche.

To manage the customer relationship, it’s crucial to have deeper customer intelligence and then use that information to make each stay more memorable. For example, it is better to match up what your hotel does with each individual’s lifestyle and give them something unique based on that lifestyle to reinforce the relationship. One suggestion Helsel made was to give, for example, a customer who stays 20 times a year and uses the gym regularly, a gym membership in their home town. That way, every time they go to the gym they will think of that hotel. She said it is a much better way to build loyalty then just giving them more points on their loyalty program.

Also focus on what Helsel calls the Total Customer Experience. Customers want:

A positive, enjoyable and unique experience from the beginning until the end of their experience

They desire an emotional connection that, once made, often ensures long-term loyalty

They must be valued for a lifelong contribution versus a one-time contribution to revenues

Customers desire the perception that they are in control - ensure your customer-facing processes are engineered for how customers buy, when they buy and what they buy

Customers want choice

And they want this across all channels

In creating ways to build intimacy, Helsel said tenants include the customer’s desire to be known, confidence in service consistency, convenience, a feeling of welcoming and belonging and a comfort level where they know if there is a problem it will get handled right away.

Of course, true loyalty goes beyond the physical hotel. These days loyalty is built with every single customer communication as well.

One way hotel companies communicate to customers is via emails. However, many companies are not communicating to their guests based on established preferences. For example, hotel brands will still offer ski vacations to die hard sun worshippers

At the hotel, many hotels are at the point where they are collecting information but are simply not tapping into that information to improve a guest stay. This can actually disenfranchise the guest since they have gone tot her trouble of providing their desires which are not being executed. It’s better to not gather the information, or say when it will actually be used. “It is more harmful to ask for that information and then not use it,” said Helsel.

Pay-Per-Click Not-So-Easy

NOVEMBER 22, 2006

Pay-per-click advertising is not as simple as it might seem.

Online marketers have taken to pay-per-click (PPC), and many use it, but apparently not everyone understands it very well.

Although online marketers have been investing in PPC search marketing for a number of years, a new survey of marketers — all of whom have been using PPC for at least two years — conducted by the e-tailing group found that managing PPC programs poses a challenge.

The fact that marketers use PPC was clear from the survey. In fact, with 44% of e-commerce executives surveyed saying they allocate 20% of their entire advertising budgets to PPC search ads, it constitutes a significant portion of online marketing budgets.

They agree on where to spend PPC ad dollars, too. Of the marketers who invest in PPC campaigns:

• 100% use Google
• 90% use Yahoo!
• 76% use MSN
• 27% use Ask.com

The problem is that 40% of the respondents reported that they manage more than 5,000 keywords. To accomplish the task, 59% manage internally, 18% outsource and 24% use a combination of internal and outsourced solutions.

Somewhat amazingly, 99% of those that manage PPC campaigns in house have three or fewer people working on the job.

A third of the executives spend 21 or more hours a week managing PPC campaigns, and a third spend five or less hours a week.

"It is clear that merchants see value in this marketing method," Lauren Freedman, president of the e-tailing group, told Internet Retailer. "However, resource constraints plus limited time availability and skilled personnel to dedicate to PPC were frustrations."

Even though ROI is the primary measure of success for PPC campaigns, 27% of the marketing executives said they did not know how their cost of conversion compared with the total dollar value of each sale.

Over 50% of Vacations Now Planned Online

NOVEMBER 22, 2006

It's bad news for travel agents.

According to a survey from morefocus, a majority of travelers now plan their vacations using the Internet, while only a small percentage continue to use travel agents.

The survey found the 58% of respondents tend to plan their personal travel online. That compares to only 23% who said they usually use travel agents to plan their vacations.

In fact, the survey showed that more people, 30%, actually ask someone in their family or a friend for help planning a vacation than turn to a travel agent.

"As in a number of other industries, people are using the Internet to take control of things they used to have to rely on other people for," said Dr. Regan Carey, morefocus' research director. "Now, you can book your own hotel, plane ticket, rental car — all without leaving your home, and you probably save money, too."

He concluded, "It's a trend that will only continue to grow."

A majority of those surveyed, 55%, said they prefer to fly on vacation. Surprisingly, almost as many, 52%, said longer check-in lines at airports due to heightened security do not bother them. They view the additional wait as merely a nuisance, an unfortunate fact of life in today's world.

Mags, DVDs Offering Text-to-Buy Ads

The text-to-buy ads use a new technology from ShopText and eBay unit PayPal, allowing consumers the option of sampling and purchasing some products via their cell phones, writesvia MediaBuyerPlanner). Text-to-buy technology is in its early stages; but, according to Mark Kaplan, founder/CMO of ShopText, it will explode in 2007. Brandweek (

However, Dan Schatt, senior analyst with Boston-based research firm Celent, points out that some of the consumers targeted by the campaign may have trouble on the payment front. Teens, for example, are likely to not own a credit card, though they may have a prepaid card.

Kristine Welker, VP/publisher of CosmoGirl points to the Elizabeth Arden 2005 campaign for the Britney Spears perfume, Curious, which included mobile text messages from Spears. That was the inspiration for Arden's Hilary Duff campaign, she says, adding that the Spears campaign was great, "but it stopped short of the ability to buy on the phone."

Publishers are not the only ones implementing text-to-buy campaigns. National CineMedia used ShopText on a promo for DVDs of Al Gore's documentary An Inconvenient Truth, and club-owner The Knitting Factory intends to offer text-to-buy concert tickets for sale in 2007.

Other companies offering the ability to make purchases through mobile phones include PayPal Mobile, a new service that lets users buy CDs and DVDs from MTV and 20th Century Fox Home Entertainment.

Want to Buy That Shirt You Saw on 'Grey's Anatomy'?

Media Morph: SeenOn.com

By Abbey Klaassen

Published: November 20, 2006

NEW YORK (AdAge.com) -- Every week Ad Age Digital's Media Morph looks at how emerging technology is changing the way consumers get their information and media companies and advertisers present their messages. This week: SeenOn.com.

Clothing, phones, you name it. If you saw it on a favorite show, chances are you can order through SeenOn.com.

What it is: Think of SeenOn.com as an online shopping guide where TV fans can find and purchase many of the products they see on TV. The site is owned by Delivery Agent, which has made a business powering the online shopping environment for many broadcast and cable shows, such as "Desperate Housewives" and "Project Runway." On Seenon.com, visitors can check out the blue Orvis button down Dr. Preston Burke wore in the Nov. 9 episode of "Grey's Anatomy" and click the link to buy the product from ABC TV's online store. In addition to clothes, SeenOn features in-show music and props.

The marketing angle: An easy way to search for and buy the products seen on TV supercharges the value of product placement, argues Mike Fitzsimmons, CEO, Delivery Agent. Plus, because you can't yet buy Jennifer Aniston's sweater with your remote, said Mr. Fitsimmons, "this is the closest you can get today. Their emotional connection with the product and the entertainment medium is at its peak, resulting in higher conversion rates and a fuller exploitation of the association with the entertainment property."

The community aspect: It wouldn't be a proper Web 2.0 site without a community element, so SeenOn.com lets viewers spot and identify brands featured in shows and submit their own product-filled videos. So if you're watching, say, "Dancing with the Stars" and know who makes Emmett Smith's green shirt, you can tell SeenOn.com as part of a "spotters' program."

User-generated ready: And, of course, there's a user-generated content piece -- users can also submit their own videos featuring products in the Delivery Agent database; if the video leads to a sale, they get a cut of the revenue. There's also blogs from stylists, set creators and costume designers, such as Cate Adair of "Desperate Housewives," Tim Gunn from "Project Runway" and Mimi Melgaard of "Grey's Anatomy."

Search Engines Unite On Unified Sitemaps System

In alphabetical order, Google, Microsoft and Yahoo have agreed to all support a unified system of submitting web pages through feeds to their crawlers. Called Sitemaps, taking its name from the precursor system that Google launched last year, all three search engines will now support the method.

More about Sitemaps is to be provided through the new Sitemaps.org site. As part of the announcement, the existing sitemaps protocol from Google gets a version upgrade to Sitemaps 0.9. However, no actual changes to the system have taken place. The new version number was simply done to reflect the protocol moving from an exclusive Google system to one that all three search engines now support.

Anyone already using Google Sitemaps needn't do anything different. The only change is now those sitemaps will be read by Microsoft and Yahoo, as well. More information will either be posted at the Sitemaps.org site or see these sections from each of the search engines, which I expect to be updated soon:

• Google Webmaster Central or sitemaps info.
• Microsoft Live Search submit page or help info (choose the Live Search Site Owner option from the drop-down box. Sorry I can't link to the exact relevant pages. Microsoft has this seemingly impossible to bookmark help system)
• Yahoo Site Explorer or submit information.

Other search engines are also invited to use the system -- it has specifically been placed as open property through Creative Commons so that others can make use of it. FYI, Ask isn't part of this announcement because it wasn't invited by the other three to take part, which I find unfortunate. Then again, among all four, Ask is the only one that doesn't already accept submissions in some way.

How can others contribute to its development? That remains to be worked out. So far, there's a working committee involving the three major search engines named. They say they are open to participation from other search engines, as well as content owners, to see the system grow and develop. I expect we'll find more structure to this emerging soon. At the moment, the key work has been in getting all three to agree to support the existing standard.

How about unification around other search standards, such as improving the robots.txt system of blocking pages. Again, this is something the search engines (specifically Google and Yahoo when I spoke to them), say they're interested in. So fingers crossed, we'll see more of this down the line.

Overall, I'm thrilled. It took nearly a decade for the search engines to go from unifying around standards for blocking spidering and making page description to agreeing on the nofollow attribute for links in January 2005. A wait of nearly two years for the next unified move is a long time, but far less than 10 and progress that's very welcomed. I applaud the three search engines for all coming together and look forward to more to come.

(Postscript: Announcements are up now from Yahoo, Microsoft and Google)

Below is more from the press release. Sorry I can't do a longer post about the system, but I'm also busy attending the PubCon conference, where the announcement has happened.

Las Vegas, November 16, 2006 - In the first joint and open initiative to improve the Web crawl process for search engines, Google, Yahoo! and Microsoft today announced support for Sitemaps 0.90 (www.sitemaps.org), a free and easy way for webmasters to notify search engines about their websites and be indexed more comprehensively and efficiently, resulting in better representation in search indices. For users, Sitemaps enables higher quality, fresher search results. An initiative initially driven by Yahoo! and Google, Sitemaps builds upon the pioneering Sitemaps 0.84, released by Google in June of 2005, which is now being adopted by Yahoo! and Microsoft to offer a single protocol to enhance Web crawling efforts.

Together, the sponsoring companies will continue to collaborate on the Sitemaps protocol and publish enhancements on a jointly maintained website www.sitemaps.org, which provides all of the details about the Sitemaps protocol.

How Sitemaps Work

A Sitemap is an XML file that can be made available on a website and acts as a marker for search engines to crawl certain pages. It is an easy way for webmasters to make their sites more search engine friendly. It does this by conveniently allowing webmasters to list all of their URLs along with optional metadata, such as the last time the page changed, to improve how search engines crawl and index their websites.

Sitemaps enhance the current model of Web crawling by allowing webmasters to list all their Web pages to improve comprehensiveness, notify search engines of changes or new pages to help freshness, and identify unchanged pages to prevent unnecessary crawling and save bandwidth. Webmasters can now universally submit their content in a uniform manner. Any webmaster can submit their Sitemap to any search engine which has adopted the protocol.

The Sitemaps protocol used by Google has been widely adopted by many Web properties, including sites from the Wikimedia Foundation and the New York Times Company. Any company that manages dynamic content and a lot of web pages can benefit from Sitemaps. For example, if a company that utilizes a content management system (CMS) to deliver custom web content – (i.e., pricing, availability and promotional offers) - to thousands of URLs places a Sitemap file on its web servers, search engine crawlers will be able discover what pages are present and which have recently changed and to crawl them accordingly. By using Sitemaps, new links can reach search engine users more rapidly by informing search engine “spiders” and helping them to crawl more pages and discover new content faster. This can also drive online traffic and make search engine marketing more effective by delivering better results to users.

For companies looking to improve user experience while keeping costs low, Sitemaps also helps make more efficient use of bandwidth. Sitemaps can help search engines find a company’s newest content more efficiently and avoid the need to revisit unchanged pages. Sitemaps can list what is new on a site and quickly guide crawlers to that new content.

“At industry conferences, webmasters have asked for open standards just like this,” said Danny Sullivan, editor-in-chief of Search Engine Watch. “This is a great development for the whole community and addresses a real need of webmasters in a very convenient fashion. I believe it will lead to greater collaboration in the industry for common standards, including those based around robots.txt, a file that gives Web crawlers direction when they visit a website.”

"Announcing industry supported Sitemaps is an important milestone for all of us because it will help webmasters and search engines get the most relevant information to users faster. Sitemaps address the challenges of a growing and dynamic Web by letting webmasters and search engines talk to each other, enabling a better web crawl and better results," said Narayanan Shivakumar, Distinguished Entrepreneur with Google. "Our initial efforts have provided webmasters with useful information about their sites, and the information we've received in turn has improved the quality of Google's search.”

“The launch of Sitemaps is significant because it allows for a single, easy way for websites to provide content and metadata to search engines," said Tim Mayer, senior director of product management, Yahoo Search. "Sitemaps helps webmasters surface content that is typically difficult for crawlers to discover, leading to a more comprehensive search experience for users.”

“The quality of your index is predicated by the quality of your sources and Windows Live Search is happy to be working with Google and Yahoo! on Sitemaps to not only help webmasters, but also help consumers by delivering more relevant search results so they can find what they’re looking for faster,” said Ken Moss, General Manager of Windows Live Search at Microsoft.

The protocol will be available at sitemaps.org, and the companies plan to have Yahoo Small Business host the site. Any site owner can create and upload an XML Sitemap and submit the URL of the file to participating search engines.

Posted by Danny Sullivan on Nov. 16, 2006

Trademarked Keywords

NOVEMBER 17, 2006

A legal gray area.

By Ben Macklin - Senior Analyst

Over the last few years, there have been a variety of cases brought before the courts both in the US and overseas relating to search engines selling trademarked words as keywords. For example, is it legal for Coca-Cola to buy the keyword "Pepsi," so that every time a user types in "Pepsi" she receives the sponsored advertising listings of Coke?

The answer is that the issue is still a little gray. A recent ruling in a case brought by GEICO, a US insurance company, is illustrative. This decision allowed Google to sell the search term "GEICO" to the highest bidder, as long as the "sponsored link" that was served up with any search results did not contain the term "GEICO". For background on relevant cases, see this blog.

Google's trademark complaint procedure for US and Canadian companies includes the following statement (available here):

"When we receive a complaint from a trademark owner, we only investigate the use of the trademark in ad text. If the advertiser is using the trademark in ad text, we will require the advertiser to remove the trademark and prevent them from using it in ad text in the future. Please note that we will not disable keywords in response to a trademark complaint."

This would seem to confirm the GEICO ruling: that the text within the sponsored link is more important in terms of trademark infringement than the keyword that triggers delivery of the sponsored link.

However, this does differ from Google's statement with regard to companies outside the US and Canada:

"When we receive a complaint from a trademark owner, our review is limited to ensuring that the advertisements at issue are not using a term corresponding to the trademarked term in the ad text or as a keyword trigger."

Survey data from MarketingSherpa certainly seem to indicate that companies are becoming more aware and particular about how their trademarks are used in search marketing.

Companies, of course, have a great incentive to protect their trademarks and their overall brand. In search marketing, branded keywords are more likely to be clicked by Internet users than non-brand keywords, according to 360I.