Wednesday, September 05, 2007
new iPods: new hardware, but more importantly...
Today Apple revamped its iPod lineup, and I am doubtless one of thousands commenting on it. What isn’t news to me is the range of hardware selections in the iPod family. What caught my attention instead were the availability of the iTunes music store to “Touch” wireless iPods and the free availability of the service at Starbucks. Despite my aversions to Starbucks, I have to admit this is killer marketing for this capable device.
This idea of immediate sales of digital music direct to devices has been the grail for developers for years. I was involved in 2000 – 2001 with a company called ETC Music, Inc. We were developing one of the first direct-to-device MP3 point-of-sale stations. The biggest obstacles we faced were the hardware wasn’t available and the music industry wasn’t ready.
No clear winner had emerged from the range of MP3 players, and the iPod was not quite a household name yet. Bluetooth was not yet implemented and everybody had their own proprietary connector and software. WiFi was newly integrated into Apple products, but hadn’t yet gained the widespread acceptance we see today. Additionally, the music industry was reluctant to offer music online - Napster had the labels spooked about the future of their format.
Apple has taken care of both of those issues by integrating purchase functionality into wireless iPods and building up a strong enough customer base (and industry rep) with iTunes. Direct-to-device may be the nail in the coffin for brick and mortar stores. But it will also open up far more opportunities: buy albums right at shows. Go to a movie and if you like the soundtrack, you can buy it right there. These examples may sound unbelievable or cheesy, but they offer a high convenience value to consumers and present POS opportunities anywhere.
This idea of immediate sales of digital music direct to devices has been the grail for developers for years. I was involved in 2000 – 2001 with a company called ETC Music, Inc. We were developing one of the first direct-to-device MP3 point-of-sale stations. The biggest obstacles we faced were the hardware wasn’t available and the music industry wasn’t ready.
No clear winner had emerged from the range of MP3 players, and the iPod was not quite a household name yet. Bluetooth was not yet implemented and everybody had their own proprietary connector and software. WiFi was newly integrated into Apple products, but hadn’t yet gained the widespread acceptance we see today. Additionally, the music industry was reluctant to offer music online - Napster had the labels spooked about the future of their format.
Apple has taken care of both of those issues by integrating purchase functionality into wireless iPods and building up a strong enough customer base (and industry rep) with iTunes. Direct-to-device may be the nail in the coffin for brick and mortar stores. But it will also open up far more opportunities: buy albums right at shows. Go to a movie and if you like the soundtrack, you can buy it right there. These examples may sound unbelievable or cheesy, but they offer a high convenience value to consumers and present POS opportunities anywhere.
Labels: ipod mp3 digital music apple wireless
Sunday, September 02, 2007
Directed advertising on Facebook
Facebook plans to provide personal information to advertisers, but will it help or hurt the website? On one hand, Facebook needs to increase profits to entice potential buyers. But his could come at the expense of cheesing off users, who may find it invasive. Many are turned off by the concept of companies knowing what they’re into.
There’s a wealth of information out there about why directed advertising, which shows you ads for products you are more likely to want, functions effectively; people don’t mind advertising as much because they don’t perceive it as irritating, and companies get a higher click-through rate.
The ways Facebook has implemented this kind of openness has received mixed reactions. Facebook’s got into hot water when they added listings of all the recent activities in your user group. However, their public API has been well-received. MySpace has not opened their website up with a similar offering, so this sets them clearly apart from the competition.
My personal feeling is users may find it invasive in theory, rather than in practice. Users are already exposed to hundreds of advertisements in their browsing day, and other advertisers are already using such placement technology. Additionally, my own research suggests that, in the case of MySpace, people who use social networking sites are more likely to naturally self-disclose information. That is, they are more open with information about themselves. For this reason they may find directed marketing less offensive than, say, a message board devoted to techno music or computer security.
The downside for Facebook would really be if people started putting in bogus information to foil the directed campaigns, much as underage MySpace members put in fake birth dates when registering. This would reduce clickthrough rates and overall effectiveness of directed advertisements. But if Facebook is successful, and especially if this advertising entices a buyer in the next year, directed marketing could become more prominent in online communities.
There’s a wealth of information out there about why directed advertising, which shows you ads for products you are more likely to want, functions effectively; people don’t mind advertising as much because they don’t perceive it as irritating, and companies get a higher click-through rate.
The ways Facebook has implemented this kind of openness has received mixed reactions. Facebook’s got into hot water when they added listings of all the recent activities in your user group. However, their public API has been well-received. MySpace has not opened their website up with a similar offering, so this sets them clearly apart from the competition.
My personal feeling is users may find it invasive in theory, rather than in practice. Users are already exposed to hundreds of advertisements in their browsing day, and other advertisers are already using such placement technology. Additionally, my own research suggests that, in the case of MySpace, people who use social networking sites are more likely to naturally self-disclose information. That is, they are more open with information about themselves. For this reason they may find directed marketing less offensive than, say, a message board devoted to techno music or computer security.
The downside for Facebook would really be if people started putting in bogus information to foil the directed campaigns, much as underage MySpace members put in fake birth dates when registering. This would reduce clickthrough rates and overall effectiveness of directed advertisements. But if Facebook is successful, and especially if this advertising entices a buyer in the next year, directed marketing could become more prominent in online communities.
