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 / Summer 2009 / Issue 55(originally published by Booz & Company)


Esther Dyson: The Thought Leader Interview

These sites are great places for marketers to sponsor. But it’s not the same as other forms of sponsorship; the marketers need to be relevant — but not controlling. They’re used to being in charge. But this type of media is full of people being active without them.

S+B: But isn’t there also a huge “silent majority” of people who just want to be passive consumers, whether online or off?
DYSON: I don’t know, because, after all, they’re silent. Yet I’m amazed at how many people are jumping in actively. The Pew Research Center has statistics on this. [In January 2009, Pew published survey results that 35 percent of adult Internet users had accounts on a social networking site and 75 percent of adults between 18 and 24 had them; furthermore, the numbers were growing. See “Social Networks Grow: Friending Mom and Dad,” by Amanda Lenhart.]

Interrupted Conversations

S+B: How do you see online marketing evolving?
DYSON: Traditional advertising, a major source of income for traditional media, is under threat. Even after the recession ends, audiences will be much farther along the path of spending time online, rather than with TV or print publications — unless it’s with their Web-based versions. Marketers will use the new media to interact with consumers directly, leaving the traditional content providers in the lurch. Increasingly, consumers are interested in talking to one another, rather than reading the precious words of the experts. That doesn’t mean the death of professional content, but it does mean a dramatic change in the content providers’ business models.

The music business hit this wave first. They started out complaining that people were stealing their music, but really their cost structures were out of whack. Over the last few years, the successful labels have refocused themselves on helping artists manage their careers and market themselves. The concert business now is booming, amazingly, while traditional sales of recorded music are not.

Newspapers have to go through a similar transition now. They had a business model that was fine when the classifieds paid for the news — lots of revenue that both required and supported staffs of thousands. But now Craigslist has replaced those classifieds with a staff of only perhaps 50 people — with dramatically lower costs and revenues. I have a lot of sympathy for news media — not necessarily for the owners, but for the holy craft of journalism, which I think is sacred and should be revered. It may need to be kept alive by foundations such as Paul Steiger’s ProPublica and the International Consortium of Investigative Journalists.

Meanwhile, marketers will have to integrate themselves into conversations already taking place on the Web. And most people aren’t having online conversations about ketchup or toilet tissue; maybe those aren’t good things to advertise online, or you have to be really creative. How about a “who smells best?” site for a deodorant marketer?

A lot of marketers are now excited about behavioral targeting, which means tracking consumers’ behavior across the sites they visit and showing them ads relevant to what they’re posting or where they’re visiting. So they barge into an ongoing conversation, talking about their product at a time and place where consumers aren’t really that interested and feel that their conversation has been interrupted. Yes, I may be planning a trip to Paris, but just now I was talking to Alice about my weekend in Moscow and I don’t want to hear about your round-trip specials!

S+B: What do marketers have to do to reach people?
DYSON: The really good marketers will become much more clever about what they do, and engage with people more effectively. Conventional media will lose a lot of those marketers, because the marketers don’t need the media as much anymore. Coca-Cola used to need Time magazine or television to reach consumers. Now Coca-Cola can sponsor contests and get people to put Coke badges and links on their own Web sites. Assuming the same number of viewers, would you rather have your logo next to a news article or on the home pages of thousands of consumers who are fans of your product and proud to say so to their friends?

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