Digital Strategy 09 Forecast

Digital Strategy Prognostication

What does the Digital world hold for us in 2009? Of course, no-one really knows – the answer is unknowable, however there are some pointers:

• Firstly, in the teeth of a recession, ecommerce will continue to rise. Dennis Woodside, Head of Google in the UK, writing in NMA, reported an interesting statistic: The UK’s population is 20% that of the US but it had 60% of that country’s ecommerce spend. That’s a significant indicator of how people in the UK shop. This trend will continue. 09 will see further growth in online sales as consumers search for better deals and research more product categories than they might otherwise have done. Expect a big year for price comparison sites such as Kelkoo.co.uk and Confused.com.


• Secondly, online spend will increase as a share of total media. In 08, online took just over 18% of all media spend and that share will increase, past 20% - a significant milestone. For online to grab a significant increase beyond this level will be hard – TV is still by a comfortable margin a bigger spend area and a more influential advertising media. The challenge for Online is to balance the needs of advertisers with those of the online population and the online community has more resistance to intrusive advertising.


• Thirdly, the mobile internet and a question asked of the two previous years: will this be the year when mobile finally becomes fast, engaging and ubiquitous? Well, no. That’ll be 2010 at the earliest. 09 will however see significant progress on mobile. Increased spend will drive further innovation. Better handsets, better mobile browsers, improved analytics, improved website design to allow content and advertising to work in numerous screen sizes and a change in mobile charging with more unlimited data bundles. A challenge for mobile operators has been getting data spend to increase significantly. The one big data success has been Texting and that’s been around for 10 years. 09 will be about setting the stage for the future success of mobile, but don’t expect a big change in 09.

Brands will be giving their Digital Strategies a shine in anticipation of a tough trading year. Fundamentals will be even more important: understand your customers, engage them with a fantastic online experience, integrate all marketing channels and deliver on your promises. Easy! Here are 8 Specific Predictions for 09 that might feature in the Digital Strategy of more than a few brands:

1. Video will become even more apparent – taking a more prominent position on more sites. Highlighting products and services through video works well today and expect this to become prevalent on many more sites. Things like destination guides in travel, product announcements in B2B, product demos in ecommerce will all benefit from increased use of video. Expect better tracking and analytics and on publisher sites, advertising intros and outros sandwiching the video content. Long run video will expand in 09. Examples from 08 include the wonderful Whopper Virgins and Adidas Dream Big campaigns – truly amazing online campaigns that use video as the key communication form. We’re likely to see many more examples in 09. Also big will be short and long-run video from the “upload yourself” generation. Self publishing has never been so easy with devices offering direct to YouTube offerings.


2. Online sites of TV broadcasters will make more of their live broadcast streams available online through dedicated players like iPlayer. More and more back catalogues will also be available. The players themselves will become more sophisticated and more stable. Expect social networking features such as user ratings and recommendations based on what other users liked. Personalisation will also feature and this will give publishers valuable demographics about users – expect this to be released as better recommendations and more advertising. iPlayer will become a product BBC continues to licence to other publishers, appearing on numerous sites and devices as a default media player.


3. Search continues to grow. Yawn, what a surprise. Yes, well perhaps not a particularly insightful prediction, but important nonetheless. Expect smarter use of search – agencies will be trying hard to add value (i.e. get a fee) and this might be in closer tie-ups between promotions and search – seeding particular terms for later use in through the line activities. The removal of Best Practice Funding will force agencies to work smarter on PPC campaigns.


4. Mobile device arms race will continue at a pace with today’s handsets guaranteed obsolescence making room for even “better” handsets by Xmas 09, taking the feature lists beyond the needs of even the geekiest of us. One positive out of the device wars will be a continued push on two fronts important to users – capacity and screen resolution. Expect Apple in Sept/Oct to announce a doubling of storage capacity on iPods and iPhones. And finally the iPhone will get a decent camera.


5. Online celebrity chasing will continue at an indecent pace in 09 with sites such as the wonderful Gawker.com commanding even more attention (and more advertising) with stories exposing celebrities to be just as mean, dishonest, avaricious and insecure as the rest of us. Expect strong growth in a social networking dimension to celebrity chasing – who spotted whom to appear on social networking and publishing sites – and more pictures submitted to sites directly from mobile phones, with, gasp, Jennifer Aniston shopping in LA wearing, wait for it, ... Gucci sunglasses! OMG!


6. Improved targeting (and tracking) will appear through the back door. Having had the front door slammed in its face in 08, behavioural targeting will creep in, step by step. Concerns about privacy need to be addressed, but claims that users will flock for the exits are unrealistic – consumers often express displeasure in “I’ll definitely leave my ISP” terms, however, who are they going to leave for? Another ISP that’s toying with a different behavioural targeting model? And anyway it’s such a fag to change ISPs that it’s not worth the hassle. Uncertainty can be overcome with information and expect a low-key charm offensive in 09. And, better targeted ads – and that’s a wholly good thing.


7. Online display advertising will continue to be enriched with more use of video. Expandable positions (where the ad expands to take over content space when you mouse over the ad) will increase and many more auto-run ads will appear on publisher sites. This creates a good workflow for digital agencies in production terms but expect pressure from above the line agencies muscling in on areas closer to their area of expertise. Media buying agencies and Ad agencies are beefing up Digital Media arms and will extend campaigns across media, capturing as much of the total production and media buying budget as they can. Expect more use of content designed for TV advertising to appear in online display.


8. Internet Explorer will continue to dominate browser share, albeit at a lower level as competitors continue to push aggressively, particularly Google with their new browser, Chrome. IE8 due in February will be the biggest upgrade of the year for most people. Initially a lot of websites will force IE8 into IE7 compatibility mode but increasingly website developers will take advantage of the new features in IE8 and design sites to work well in that environment – a change from the lowest common denominator approach of current development standards. Firefox, Safari and Chrome will still be playing catch-up in 09.

Certainly a common thread is Technology. Much of online is powered (obviously) by technology, but it should be mostly a background service, not the core proposition. A source of innovation and value certainly, but without an engaging content wrapper, technology on its own makes for a thin customer experience. A Digital Strategy should not be defined by technology. In fact if your Digital Strategy contains terms like load-balanced servers, XML or open-source, then ditch it, it’s not a Digital Strategy.

So that’s it. A very personal view on what might happen in 2009. This will be an interesting year in Online – seeing how brands deal with a slowdown in the economy and seek improved return from their online spend. Who will win? Who will lose out? It looks to be a good year for comparison shopping sites, but a bad year for whom? Charities possibly? Compared to offline, where there will be carnage, online looks likely to be spared major slowdowns, due to the measurable nature of online. A strong Digital Strategy will help online brands through this time of economic slowdown. It’s not enough to be online, brands must understand and engage consumers – and turn that engagement into pennies.

And finally ... some personalities who may well have a big year in 09.

1. Barrack Obama. As The Onion quoted: “black man gets America’s worst job”. A big year for Mr Obama. Is it too much to say that the world is looking to Mr Obama for hope? Certainly a fresh start but he will face many challenges. Look for this to be the most open presidency online.


2. Perez Hilton. Mr Online Gossip who spits out poisoned notes about celebrities over-managing their public personas contrasted with their calamitous personal life decisions.


3. Elena Moscatt. Creator of online drama series: Jamie’s Way and Life After Lisa, could be a pointer to how drama will evolve – webisode by webisode. Bebo has had success with online teen dramas. The presence of a major sponsor certainly helps with production budgets.


4. Steve Ballmer. As CEO of Microsoft, Mr Ballmer will have some big decisions in 09 – moving the software distribution model online, an update to Vista and Internet Explorer and challenging Google’s dominance of online advertising.


5. Tiger Woods. Mr Product Endorsement himself, returns to golf after an injury forced the end of his 08 season. Sport online is increasingly well resourced and highlights clips are particularly popular. Expect Mr Woods to feature in many of the golfing ones. As winner.