Google Custom Search, where have you been hiding?

Just came across this really neat Google feature…

The copyright says 2007 so it has been around for a while. I am quite surprised it does not get more visibility, because it is a must have for everyone who does topical searches on a frequent basis. Yahoo! has been talking about using social / collaborative input to improve its search platform… and it seems like Google has had it for a while?

Google Custom Search is packaged as “community search” and it delivers the goods: users can include lists of sites that present more relevance to a topic. Actions speak louder than words, so click below now to try the Digital Spotlight Search Engine!

Obama’s data capture ploy

Over the past week, presumptive Democrat candidate Barack Obama dominated once again the US news cycle. In an otherwise relatively uneventful week, there was intense speculation over the airwaves, online and in print about who was on the Democrat VP shortlist… According to Google Trends, always a good buzz indicator, searches for “VP” doubled over the past week.

More importantly, the press gleefully echoed the campaign’s insistent wish that the supporters should be “the first to know” by registering their email or mobile phone number on the Barackobama.com web site. Everyone anticipated a rapid announcement which will come later than expected… but what if that was the plan all along?

Whether you support or not the Democrat hopeful, you have to admire the carefully orchestrated marketing move around this opportunity.

“First To Know” was an elaborate way to boost the size of the presumptive candidate’s direct marketing database. This may sound a bit innocuous right now but in a potentially close race, every little counts and tactics like this may make all the difference on Election Day. The Barack Obama campaign is earning the permission with the VP announcement to regularly broadcast text alerts to its support base in the fall.

There are a few notable subtleties in the way this was executed.

First the Obama campaign is managing this data capture recruitment drive at a minimal cost since they are not resorting primarily to advertising. I guess that like countless other people, I am contributing to spreading the word through the fact that I am blogging about it. Obama seems to have a strong ability to shape the conversation – both in old and new media.

The capture form includes the zip code of where registrants live, and future text messages could therefore be targeted by state or by district if needs be. This is crucial to adapt messages based on the shape of the local political battlefield, and push different issues in different states. The zip code may potentially allow to refine messaging at an even more local level.

Finally, this operation will allow the Obama campaign to communicate primarily by text message to a younger audience that is notoriously using email much less than instant messaging or mobile devices.

The message “be the first to know” is also a textbook example of proven word of mouth marketing techniques… to target the influencer type, offer exclusive, ahead-of-the-crowd information that they can use as a social currency.

As I write these lines, the announcement of Obama’s VP choice will be made in less than 24 hours (on Saturday August 23rd). It is still too early to tell if Obama’s data capture ploy was successful, and the Obama campaign will probably not disclose how many mobile phone numbers and emails they captured over the past week – if only to keep the McCain campaign guessing.

Let’s just sit back, and watch how often the Democrats leverage this new channel in the coming weeks… the political world is getting addicted to the direct relationship opportunities enabled by digital technologies, and there is no turning back.

Database Marketing Metrics in a Digital World

I have had a lot of conversations in the last few months about the fact that digital marketing is fundamentally not that different from traditional marketing.

Of course important adjustments are in order when you have to communicate to a consumer who is in control and has less tolerance than ever before for interruption and irrelevant messages. But a lot of things you know about marketing stay the same, and digital only brings more depth and richness to the way. Here is one example from the world of database marketing.

In the early days of database marketing, catalogue marketers were trying to find ways to identify which customers were most likely to buy than others when there was a communication effort. The straightforward way was to segment customers based on how much they had spent to date – and that turned out logically to be a good predictor (or “proxy” for the DM purists).

But relying on the monetary value only proved somewhat limiting: there were lots of customers who were buying even if they were amongst the most valuable ones, and there were many customers identified as very valuable who used to buy a lot but not anymore (you may have heard of them as “lapsed customers”).

It turned out that by looking also at how recently and how frequently customer bought over the last few months, the accuracy was greatly improved. By adding and combining these two additional parameters, database marketers could guess who would buy and who would not – and that could lead to significant savings in printing and postage costs.

And so very empirically the RFM prediction model was born – R for Recency, F for Frequency and M for Monetary value or Money spent. Its efficacy is still as impressive today as it was over the past two decades. Of course, more sophisticated models have appeared over time using statistical techniques such as regression analysis, neural networks or genetic algorithms… RFM has the merit of simplicity and can be applied without advanced statistical know how and resources.

Visit this site if you are interested in reading more about RFM.

So how do you apply a digital lens to RFM? The model stays the same but there is room for additional information. RFM appeared in an era where storage and the number of opportunities for collecting data were limiting factors. RFM focuses therefore on transaction data – but does not necessarily leverage interaction data which can be more easily tracked today.

There is an opportunity to look at two more dimensions: Attention and Engagement. Attention can be for example measured by how frequently a consumer opens your emails or how many of your last 10 emails they opened. Engagement can be indicated by the time a consumer spends on your web site after clicking from an e-mail. In fact the model can be extended outside of e-mail marketing to include online advertising – although it would apply in this case to anonymous prospects rather than identified customers. And in a not so distant future, with new technology that allows delivering targeted TV advertising to specific households, such an approach could expand to other marketing channels.

Moving from RFM to FRAME is a good way to describe how marketers should approach their migration to the digital world – key basic principles stay the same, and additional data open up new opportunities for understanding customers. At the same time, it is very easy to look at too much information or at the wrong information: so when it comes to new marketing models, keeping things simple is paramount.

Airbus A380: a memorable flight experience

One of my early posts on this blog was a comment on the commercial launch of the Airbus A380 in October 2007. I never ceased to be amazed by the steady flow of search engine traffic I got around this topic. Having recently had the opportunity to fly on one of Singapore Airlines’ A380, I feel compelled to revisit my initial post and share some of my flight impressions.

Much has been said about the fact that airports have to invest to accommodate the dual deck boarding requirement of the A380. The boarding is indeed quite fast in spite of the large number of passengers (more than 400).

However the check-in experience did not go through a similar overhaul, and there the pinch can be felt. The wait was on the edge of excruciating, and it certainly did not help that a large group of travellers to an ashram in India clogged the process that day. This is probably the only part of the experience that can be significantly improved… once in the plane, it is an entirely different story.

You notice immediately three main differences compared to even recent aircrafts.

The first striking difference is the legroom, even in economy class. The layout of the cabin with a lot of overhead space and the very large windows add to the impression of roominess.

The second difference is the low noise and vibration level in the cabin. If you are used to the rumble and roar of a 747 or a 777, you are in for a real surprise. The superjumbo accelerates so effortlessly and silently that you barely realize that the plane has left the ground.

Last but not least, the third difference lies in the interactive in-flight system. I guess that some people would point out that it does not offer a touch screen – however, I have to say flat out that this is by far the best remote-based user interface I have tried in a plane.

There are a few simple things to expect from any user interface: consistent, intuitive, visually pleasing, and that there is little to no lag time in terms of responsiveness. Yet you would be surprised how many in-flight systems fail to deliver on the basics. The A380’s in-flight system has a few very small flaws but it clearly sets a new standard – I am curious whether it is the work of Airbus’s or Singapore Airlines’ interface designers?

By the way, the interactive system does not limit itself to entertainment (movies, music, games) and to flight information. It also offers the Sun StarOffice productivity suite – you can launch a word processor or a spreadsheet program, and plug a USB key in the seat to save your work. The seat connectivity also includes a video-in feed, a network cable plug and even the economy class seats feature Empower electric power plugs.

If you are interested, you can watch more screen shots and pictures on Flickr: cabin and interior, entertainment menu screens shots, flight information menu screen shots, productivity menu screen shots.

I was really impressed by the incredible attention to detail in order to improve every single aspect of the flight experience. In my humble opinion, all other things being equal (price, class…) it will be very hard to beat, let alone match the new benchmark established by the A380. In fact, bar the seat recline and the meal, my A380 economy class experience on Singapore airlines did not seem too far off from what some US carriers offer in business class.

I have talked mainly about the “product” until now, so let me continue and conclude with a few words about the communication.

In my initial post, I wrote about Singapore Airlines’ dedicated A380 web site, a key element of their marketing to support the plane. There is also a significant presence through paper billboards and digital displays in the airline’s main operations hub, Changi Airport. The airport is featured prominently, given the effort to adapt the airport infrastructure for the A380.

The rest of the communication does not emphasize the benefits of the A380 but on which routes the plane will be flown.

This complements the significant word of mouth activity around the new plane. There were actually tens of passengers taking pictures of the plane before take-off and after landing… and the search engine traffic on my own blog around the A380 is another anecdotal evidence of the lively online buzz.

The A380 success is not assured yet, given the economic uncertainty facing the world economy and the increasing pressure on oil prices that airlines are facing. Regardless, the Airbus A380 is highly likely to be considered in the future as a key milestone in the evolution of the aeronautics industry.

Would you have a few minutes for a brain map?

A few weeks ago, publications like The Economist and Discovery Channel reported the results of research linking price and perception of quality in wine. It was essentially a blind taste with different bottles of wine priced differently.

However, unknown to the study participants, researchers included some of the same wines twice, presenting them as different wines with different price tags. Wine enjoyment was directly and strongly related to the perceived price tag, more so than to the actual content of the glass.

This has direct implications for marketers of luxury and premium products. Take note, Starbucks! It also means that “trading up” should not be considered just a passing fad, even if the trend is likely to be affected by an economic downturn.

The striking part is the tools that were used for this research. It was yet another example of using fMRI (functional magnetic resonance imaging) for marketing and consumer research purposes.

Neuroscience technologies have their original roots in the medical world: as the price and the size of the equipment is decreasing, brain mapping usage is becoming widespread … from evaluating soda formulas to cars and (of course) US presidential candidates.

In my opinion, there are at least three reasons that make MRI technology so attractive for market research.

First, unlike other research tools, it promises to reveal the real nature of audience reactions, not just what they claim to think. It also helps capturing an overall brain response to multiple sensory stimuli, which brings the results closer to real life. Finally, this type of technology brings a flavor of precision and exactness to a marketing discipline that still resembles more art than science.

There are obviously clear limits to mention: brain maps deliver fairly basic information, allowing to only read simple reactions such as pleasure and displeasure. Furthermore even if the brain response that MRI captures is more holistic in nature, the complex installation process does not bode well for spontaneity and the resulting environment will remain a far-from-perfect recreation of real life situations. Having said that, the observer effect applies to other market research techniques as well.

Implementation remains complex and limits sample sizes. I think this has an impact on the way the technology is being used: there is a clear focus on highlighting universal patterns, rather than identifying clusters and differences. Let me explain that in simpler terms

For example, if researchers could repeat their experiment on wine price and taste with a larger sample, they could start investigate a lot of other questions on the “price enjoyment factor”: Is it roughly the same for everyone or does it vary by age or sex? Does the impact vary depending on people’s disposable income? If people were to receive “bargains” on premium product, how does the size of the bargain impact their enjoyment of the product?

Even if the technology is still in its infancy, we are probably witnessing the dawn of a new era in market research. One day, brain maps may well replace surveys. In fact, here is a tell tale sign: research giant Nielsen just invested in a company called Neurofocus.

I would also expect some interesting developments coming from the videogame industry, as they have tried for years to develop control systems directly linked to brainwaves – and they would surely be interested in making two-way devices that can read how much a player is enjoying its gaming experience.

If anything, this will create a brand new field of investigation for privacy advocates!

2008 Trend Blend

Just came across the latest trend map published a few weeks ago by futurologists Nowandnext.com.

They borrowed from the Shanghai subway map and chose to elevate 5 key trends: Anxiety, Ageing, Globalisation, Digitalisation, Virtual Worlds.

On a similar topic and with more focus on the here and now than the future, I would recommend Mark Penn’s book “Microtrends”. Since Mark Penn is one of the main advisers behind the Hillary Clinton campaign you can definitely see how that sort of targeted thinking has become increasingly important in marketing aspiring U.S. presidential candidates.

And for the Tufte fans amongst you, more on subway / underground maps!

EMI group moving from retail to media

Back in October, I wrote a post about how the music industry had lost control of the music distribution and retail game to Apple… and how it would probably have little choice but to evolve into a content business funded by advertising. Well, it looks like this transformation may happen at a much faster pace than anticipated.

Recently published numbers have shown the extent of the music industry crisis: record sales fell 15% in 2007 compared to 2006, and even the 45% growth in digital downloads does not seem to be enough to reverse the music industry’s retail fortunes.

Like many other companies, EMI Group was acquired last year by a private equity group and that usually translates rapidly into a dual effort to cut costs and increase revenues. In EMI’s case, what caught my attention are the plans to aggressively seek corporate sponsorship arrangements beyond youth / lifestyle brands like Pepsi and Coca-Cola.

From time.com: “Dreaming up new ways to make money is vital. One solution: teaming willing artists’ albums up with corporate sponsors, as EMI plans to do. That might have some artists turning in their grave — just imagine that, John Lennon — but with music arenas often branded these days, EMI is confident it can sell the idea to some of its talent. Coldplay’s next CD, brought to you by ExxonMobil, anyone?”

Full article here.

Airlines and innovation

British Airways announced today the launch later this year of OpenSkies, a new airline that will fly from New York to various cities in Europe. Likely destinations include Brussels and Paris, although this has not yet been confirmed.

[Updated Jan 10 2008] I wrongly assumed initially that it was a business class only airline, but as more details emerge in the press it looks like OpenSkies has a 3-class configuration: business, premium economy, economy.

This looks like the perfect timing to publish a post I wrote a few months ago about airlines and innovation. It was initially meant to appear in Idris Mootee’s blog Innovation Playground.

Just two more things to add… First, the original post has been updated to reflect the new number of low cost airlines in Europe and the recent bankruptcy of business class airline MaxJet. Also in the spirit of full disclosure, I should mention that I have been working for various clients in the airline industry for the last ten years – boy, things have changed during these ten years! But my point of view remains external and hopefully unbiased. You be the judge…

Innovation comes in many shapes and forms. Along with a strong brand, innovation is an essential way to create differentiation in an industry that is highly commoditized. Come to think about it: travelers are flying in the same planes; they eat food that was prepared in the same airport kitchens… even the schedules are not that different as airlines are coveting the same time slots. And you may even have noticed if you have flown different airlines on the same month: you often get the exact same selection of in-flight movies!

As a result of this standardization, innovation has been concentrated in a few specific areas: price, value for money and loyalty programs.

One major innovation came in the 1970s with Southwest Airlines, whose “no-thrills” model has been since then replicated by the likes of Ryan Air and Easyjet. At the last count on www.flycheapo.com, there are now 45 low cost airlines in activity in Europe [updated January 9, 2008]. The operational aspects of the low cost business model are well documented: minimize time on the ground, reduce maintenance and training costs through a standardized aircraft fleet.

What I find most fascinating about the Southwest story is that they did not try at first to compete with major US carriers. They wanted to lure consumers away from Greyhound buses, by offering a much shorter trip for a small additional cost.

As competition amongst carriers increased as a result of the 1978 deregulation, American introduced in 1981 the first loyalty program. Other airlines quickly followed suit, as the programs proved successful for both the airlines and for the consumers. Today with the proliferation of programs and the increased difficulty and costs associated with redeeming miles, there are clear signs of loyalty fatigue. Most rewards programs have to adapt and offer more inspirational experiences.

Major North American airlines with their unionized personnel, aging fleets and cost base could not compete effectively with the likes of Southwest and JetBlue. Events like the terrorist attacks of September 11 and the SARS crisis further contributed to depressing travel demand. In the five years between 2001 and 2006, these airlines undertook some drastic transformation to improve their competitiveness. For example, to respond to the price pressure on North American routes Air Canada recently introduced “prix fixe” coupons.

They also started to disengage from the highly competitive domestic market to focus on more profitable international routes – the domestic capacity for major US airlines steadily decreased from around 39% in 2001 to 33% in 2006. Their network is expanding beyond traditional high traffic destinations: Delta broke new ground by offering direct flights between New York and Accra, Ghana. Yet major US airlines have been in reactive mode, responding to innovation rather than driving it.

As the industry focus moved to transatlantic routes, so did the innovation drive. Low cost business airlines like EOS, Maxjet, Silverjet or L’Avion are targeting the highly lucrative business class traveler. They use an older type of plane (757 or 767) but fit them to fly only 50 to 100 passengers instead of 200. The price of a business class ticket is usually around 50% cheaper than on traditional carriers – a proposition especially attractive to business travelers who do not benefit from corporate discounts.

While Maxjet declared bankruptcy at the end of 2007, the other business airlines claim that they have been very successful, with occupancy rates already above 75%. Interestingly it looks like a large portion of their following comes from leisure travelers who are willing to pay a little more to escape the potentially dreadful experience of flying transatlantic in economy class. [paragraph updated on January 9, 2008]

With further deregulation under way with the “open skies” US-EU agreement, established airlines like British Airways and Virgin Atlantic are considering deploying direct business class only flights to other European cities than London.

Similar developments will probably soon see the light of day in Asia, the fastest growing air travel market in the world. Low cost airlines have appeared across Asia, most notably in China and India.

So what’s next – where is the next wave of innovation going to come from in air travel?

There is no disruptive technology on the near horizon. New supersonic jets or planes designed for sub-orbital flights are being developed but it will probably take decades before their actual introduction. In the meantime, most of the technological progress is incremental and aims at reducing the operational cost per mile per passenger.

It is a safe bet to assume that after changing the landscape for economy class and business class, the low cost pattern will soon be expanded to executive jet travel. The industry has already moved from a full time ownership model to a time-share model, made famous by NetJets. And Marquis Jets already made the executive jet time-share model more accessible by lowering the entry point to 25 hours a year.

Time will tell but the air travel landscape in 2015 will probably bear little resemblance to that at the beginning of the millennium.

One last look at 2007, and a glimpse at 2008

Back on track! I have been unable to pay as much attention to this blog over the last month as I would have liked. Well – one more item to add to the 2008 resolutions list

Zeitgeist is the German word for “sign of the times” (the literal translation is in fact “spirit of the times”). Search engines remarkably capture what’s on people minds on any given day, and Google Zeitgeist was created to capture and share some of those trends.

They put together a fascinating summary of 2007 search trends, covering specific categories like news, show business, technology, etc.

It seems that from that perspective at least, 2007 will be remembered as the year of the iPhone.

Webkinz, the virtual world for kids, makes an interesting appearance on the second spot of the fastest rising US search terms. According to Quantcast, it is now one of the 300 most popular sites in the US, with a monthly audience of 4.3 million unique visitors.

What’s in store for the year ahead? Yahoo! Buzz is a similar service to Google Zeitgeist. They published today (January 1st) a list of all the searches that include the number 2008. Apparently much of the attention is on bank holidays!

Here is the list:

1. 2008 Dodge Challenger
2. Printable January 2008 Calendar
3. 2008 World Junior Hockey Championship
4. New Year 2008
5. 2008 U.S. Holiday List Calendar
6. 2008 Year of the Rat Predictions
7. Super Bowl 2008 Date
8. Presidents’ Day 2008
9. 2008 Rose Parade
10. Happy New Year 2008

1. Free 2008 Online Calendar
2. Mardi Gras 2008 Date
3. Thanksgiving 2008
4. New Year’s Eve 2008
5. Martin Luther King Day 2008
6. 2008 Ford Edge
7. 2008 Dodge Charger
8. Mother’s Day 2008
9. Iowa Caucus 2008
10. 2008 Sugar Bowl

Not direct mention of two 2008 events that are bound to capture worldwide media attention: the 2008 U.S. Presidential Election (11/4/2008) and the 2008 Beijing Olympic Games (8/8/2008). Interestingly 8 is considered a lucky number in China, and the opening date of the Olympics reads as 8/8/8 – obviously an intentional move in a culture where superstition is taken very seriously. “Year Of The Rat Predictions” is number 6 in the list after all!

Happy New Year to everyone!

Culture Pub vs. Firebrand

The French week continues!

Pub stands for “la publicite”, the French word for advertising – rather than the more British “Public House”.

Culture Pub is a TV show about advertising that was broadcast weekly on French channel M6 for almost 20 years. This is actually an impressive amount of longevity for France (yet as a point of comparison, the soap opera General Hospital has apparently been showing in the US since 1963).

Culture Pub was taken off the air in 2005, but is now reborn as a web site which launched a couple of days ago: www.culturepub.fr. It is literally a Youtube for commercials with thousands of spots available – very much the same concept as Firebrand which coincidentally launched yesterday.

The jury is still out since Firebrand is in beta, but my preference right now goes to Culture Pub.

Compared to Firebrand, they seem to have more depth and editorial video content (albeit only in French). Hopefully they will realize the potential benefits of making English language transcripts or subtitles available to reach an international audience.