NARROWCASTING
by A. Anthony Citrano, III
Last time, I talked about Web sites, and how I believed they would begin to take
on existences and attract audiences in a way similar to other broadcast mediums
like television. Last month, Tony Rockliff shared a
wonderful vision of what the future of cyberspace will look like. I will follow
by discussing the power of narrowcasting, which will play a large part in the
marketplace of tomorrow.
I keep hearing from the media that the internet, or its offspring, will be the
television of tomorrow. Philosophically, I agree -- in the sense that it will
replace television by taking away its audience. Practically, however, the power
of internetworking is that it can possess intelligence about the individual
viewer. In a word, this is not broadcasting; this is narrowcasting.
Narrowcasting will reduce advertising costs, both up front and per customer. If
it's "strong enough for a man, but made for a woman", it is probably not cost
effective to advertise the product to men. If it's a personal product made for
men, you might want to save some bucks by not advertising it to women. Today's
broadcast mediums do not offer this intelligence. They simply take an
inefficient shotgun approach, hoping to hit at least some interested consumers.
Granted, many of today's advertising agencies are brilliant -- many of today's
ads are strong in both style and substance. Demographics are often studied
aggressively before a campaign is launched; but it comes down to trial and
error, and the end result is that most people who see an ad do not ever act on
it.
However, tomorrow's advertising firms will offer this intelligence. Marketing
software developed specifically for the internet can query networks about their
users, and then tell the broadcast applets which users meet the requirements.
The ad applets can then be routed to the appropriate users.
The possibilities for businesses are endless. An early example of something
approaching narrowcasting is PointCast's network, now in beta. I use this on my
desktop at work. Most of the intelligence lives on my desktop -- the net is
used to fill in the blanks. Every hour (soon, more often, I hope) my system is
updated with news and stock prices. I imagine that later, a product like
Pointcast would learn more about me (to the extent that I decide to share, of
course) and distribute this information to the advertising object store
somewhere at Pointcast. Pointcast then uses this information to set up a fluid
demographic database of their users. This information is used in several ways.
A first layer of information, such as name, age, and city, is used to tell
potential advertisers about the audience. It is far more accurate because there
is little guessing -- every single user is polled upon setup. A second layer,
such as what kind of products they have on their machine, what kind of work they
do, how much money they make, and so on, would be useful in the future and
should be incorporated into this database. A third layer of information would
be created by storing information about what ads the user clicks on, what news
stories induce a reaction, and so on, and would be used to fine tune the network
for that particular user. It would also be used to build a more accurate
picture of the consumer. Now, if a client wants to advertise only to 25-40 year
old males making over $45k per year, it's a breeze. Enter that into your
advertising packet, and there's not a single wasted bit.
This really can mean financial rewards for all involved. The advertising agency
can benefit because they offer their clients the ability to narrowcast their ads
toward the perfect audience. The client saves time and money. The agency gains
customers and credibility because it demonstrates that it understands this new
technology and how to employ it effectively, as evidenced by successes of their
other clients. The media increases their revenues because they are able to sell
specialized bandwidth in a way that has never before been done. They will have
to devise new ways to charge for services, but I've been involved in companies
that have had to do this, and there are certainly less exciting challenges than
thinking of new ways to measure income. One possibility might be the
client-byte, or a microcharge for every ad that actually hits a targeted client.
In such a mechanism, both the media provider and the advertiser are confident
that they are being treated fairly. The advertiser knows they received one unit
of exactly what they wanted; thirty or sixty or ninety seconds with their
perfectly chosen prospect. The media provider knows that they have provided
that time with the prospect -- there's no ambiguity as in print and broadcast.
Advertising firms, listen up. Pay attention to narrowcasting. Internet
publishers -- start collecting as much information from your customers as they
will voluntarily provide. This will put you in a wonderful position when
narrowcasting becomes a service regularly requested by your advertisers.
Advertisers -- get ready to target your customers as you never have before.
Your revenues depend on it.
Anthony's Stock Blurb:
Take profits on short positions previously recommended in Netcom and Spyglass.
If you shorted when I recommended in December, you are up between 60-110%.
Close these positions -- and have some champagne. If you shorted Netscape and
are up over 25%, close. If not, hold short. I believe it is in for another
drop in the coming weeks due to a selloff by insiders. Their 6-month waiting
period is at the end of this month (Feb).
Intel (INTC) is still a wonderful buy, as are Number Nine (NINE) and S3 (SIII).
Nine released crappy earnings for the fourth quarter, and have been beat up.
They still have a solid product (video cards) and a great market. 3D graphics
are on the rise. S3 is the same story; they make the chips that live on such
video cards. Novell (NOVL) is still a great buy. I still think IBM wants to
own it. A new company I am excited about is US Order (USOR). They are growing
rapidly, have a solid team, and are offering systems that do electronic
transactions over networks.
About the author:
A. Anthony Citrano, III is the former owner of Advantage Consulting
Group in
Portland, Maine and founder and former President of 3D Millennium
Publishing of
Portland, Maine, one of the first companies in the world to publish an
electronic magazine on the Internet's World Wide Web. Over the years, he
has
appeared in national and local media as an expert on computers,
telecommunications, the internet, and computer network security.
Citrano has
appeared on NBC's Today Show, CNN Headline News, and several regional
television
stories. He has been featured in print mediums such as Inc. Magazine,
The
Seattle Times, Media Daily, East Side Week, Newsday, and more. He is a
Contributing Editor for SYNAPSE
Magazine,
and the New England business magazine, The Small Business Review. He
also
authors monthly columns for Cybertown's Cybernews.
If
after
reading all of that, you still don't think he's a geek, try this --- he
absolutely loves what he does! He currently works as Information
Services
Manager for Maine Governor Angus King (the only Independent Governor in
the
nation) and loves getting e-mail from readers at:
72610.657@compuserve.com
