|Issue:||Europe II 2009|
|Topic:||Innovating to reach the consumer|
|Title:||CEO, AOL Europe|
Dana Dunne is the CEO of AOL Europe; he served previously in the US as the head of AOL’s transformation programme. Prior to joining AOL, Mr Dunne was the Chairman and CEO of WebTV Europe, a mobile music and private investment company based in London. Previously Mr Dunne was President of the Wholesale and International Carrier Services business unit for Belgacom, where he had served earlier as the General Manager of the Business Division. Earlier in his career, Mr Dunne was at the American telecoms company US West as Head of Corporate Strategy and Development as well as President of US West International. He was a leader of McKinsey & Company’s telecommunications practices, based in their London, Brussels and Madrid offices. Dana Dunne holds MBA and MA joint degrees from Wharton, University of Pennsylvania, and is a fellow of Joseph H. Lauder Institute.
Consumers expect services on the Web to be free, so advertising will have to pay the way, but it is increasingly difficult to target advertising to the right consumers, the right sites and on the correct device. Advertisers need to reach the consumer whether on a computer, mobile phone, iPod, PDA or television. By aggregating content from rival services and distributing it to multiple platforms – mobile, fixed, PC, etc. – consumers, advertisers, content providers and service providers all benefit.
It is safe to say that advertising will fuel the future of the Web. Consumers increasingly expect free access to just about everything on the Web – free email, free content, free services and that model requires the support of ad dollars to continue. Yet with the explosion of the Internet, advertisers face an increasingly difficult job of reaching people on the Web – audiences are fragmenting, platforms are multiplying, consumers have greater control than ever over what they see and when, and, on top of that, the pace of change continues to accelerate. Is the Web getting ahead of itself? How do advertisers keep up? Who needs a gatekeeper? Five years ago, portals were gatekeepers and many millions of customers valued that service. It was a simple and straightforward set up that made it relatively easy for advertisers to reach consumers. As the Web has developed, people have become more accustomed to viewing Web pages from a huge multiplicity of sources, so the concept of a gatekeeper to content has disappeared. Consumers roam widely on the Web, using search to find what they are looking for, social networks to connect with people they care about, and an increasing array of blogs and niche sites that appeal directly to their passions. According to Technorati, a blog tracking service, roughly 60,000 blogs are created every day. Each week, the equivalent of 57,000 full-length movies are uploaded to YouTube. Social network usage has tripled in the past three years. From a content perspective, reaching consumers today means producing great content, carefully targeted to specific audience groups. From an advertising perspective, reaching an increasingly fragmented online audience is a challenge. The blending of information and communication technologies creates powerful tools that bring people together, enhancing their digital experiences. What will help advertisers in this fragmented world is the rise of improved analytics and advertising networks that can potentially serve millions of websites. Fast forward ten years into the future, to a time where all of our media, including TV, newspapers and books, could be IP-based, and the power of the intelligent network becomes obvious. Imagine also that by reducing creative production costs advertisers can produce multiple versions of the same campaign. Two consumers then, reading the same IP-newspaper, can be served the same advertising campaign, but with separate creative content targeted to appeal specifically to each type of user. More platforms Among the ICT initiatives pursued by the European Union is the goal of introducing multi-platform access for content. Our strategy reflects this and we continually look for new ways to give consumers their preferred content, irrespective of location, time and method of delivery. One example of this is the recent launch of new portal features that allow consumers to access multiple email services from one online location. Portals, social networks and niche websites focused around ‘passion points’ that engage with consumers feed into the growing desire of mass audiences to have individualised content, irrespective of whether it gets delivered via a computer, mobile phone, iPod, PDA or television. In the past 18 months, for example, there has been a rapid acceleration of website usage and products on mobile phones. Two key things have driven this – new handsets like the iPhone, and the massive rise in mobile usage of social networking sites such as Bebo. What this clearly shows is that people want access to the Web services they use and trust on their mobile devices. Mobile Web browsing is growing faster than PC Web browsing in key EU markets – eight times faster in the UK according to recent research (http://www.mobilemarketer.com/cms/news/research/2392.html) – and content providers need to make sure that their websites deliver a compelling and engaging experience on these devices. We now see around 40 per cent of mobile traffic in the EU is coming from the iPhone. This has been a fast and rapid development, but it’s a validation of the growing strategy to deliver the fullest possible breadth and depth of content from Web to Mobile – the stories and articles available online as well as in full on mobile sites. As more and more customers use their mobile devices to browse the Web, they will use optimised mobile sites to access exactly the same content as they would on the Web. The ability to access and browsing the Web on the go is becoming a standard feature of all mobile phones, just as taking and storing pictures and video online seems to have become a common service within the last three years. With this rapidly growing new usage comes the opportunity of new monetisation from mobile advertising. One thing is for certain, as this credit crunch bites deeper into the manufacturing and retailers’ purse, the use of the Web to reach potential consumers will evolve from an ‘additional consumer channel’ to a ‘must have channel’. The rate of growth of online advertising in Europe is predicted by a number of researchers to enjoy double digit growth in 2009. Online advertising is a great new platform with exciting new customer response paths – notably click-to-call, where a click on a banner directly launches a call to the call centre of the advertiser’s sale department. The integration between Web and mobile is its key strength. With global, multi-platform, advertising networks, ads can be dynamically targeted across the Web and mobile sites wherever the customer is. For instance, iPhone customers can be targeted on both mobile and websites, making sure that ads are optimised for the device customers are using to view the site. This sort of functionality is at the vanguard of monetising this exciting new cross-platform, convergent world. New era of openness Adding to the cross-platform complexity will be a new trend just now taking off – openness. Just as publishers once learnt that adding links to competitors’ sites was a good thing rather than a threat, they are now learning that adding competitors’ content to their sites can have the same positive effect. Bebo, for example, recently joined the new OpenSocial platform that allows any developer, including competitors or advertisers, to develop content for Bebo. It is a win-win situation – Bebo dramatically enhances its own user-experience and developers get access to a high-profile platform to promote their applications. Consumers can also access custom feeds from social networking services, local news, and RSS enabled sites directly from portal homepages. On the social networking front, feeds are now aggregated from rival sites into single services, creating competitive advantages that benefit Web and mobile consumers. This ‘co-opetition’ – collaborating with competitors for mutual benefit – will be increasingly commonplace in the year ahead. It is a direct response to consumers’ desire to have as much of their content in one place, unfettered by any limits imposed by the platform or the content provider. Europe just got smaller. The pace quickens In the last year alone almost 300 new online ad networks were launched; millions more consumers became online publishers via their Bebo, Facebook and MySpace pages; bloggers beat professional newsrooms to exclusives and the launch of a new generation of smartphones heralded a revolution in mobile Internet. For brand owners and advertisers, just keeping up with the pace of change is a challenge in itself. Online advertising was always supposed to be simple but as the number of publishers, outlets, formats and channels continues to grow at a breathtaking rate so online advertising is fast becoming more complicated than TV, radio or newspapers. Exploiting technology to win Consumers have been spared the headache of the Web’s new complexity by RSS feeds, recommendation sites, cost-comparison portals for every product under the sun and the latest semantic services like Twine. Up until very recently, confused advertisers have been poorly served. That is quickly changing as the latest full-service, global ad-networks are now leveraging hugely powerful technology to reach an increasingly disparate online audience. Barriers to reaching the consumer are falling. That is good for advertisers, good for consumers, and good for the Web. The flow of cash into this sector will fund faster, smarter, better technology to reach more consumers, drive up usage and give advertisers more opportunities to reach consumers. n