IMKTG REPORT December 10 2001

OPPORTUNITIES MONDAY, DECEMBER 10TH, 2001

Good morning execs,

ad-tech was last week, a semi-giant, but
still, must attend for any company involved
in internet advertising. interesting topics
included: branding vs doing anything else
online (winner, branding), measuring
results online (winner, cpm), improving
creative, and how many media congloms
does it take to control the entire internet?
by my count, 6. in the last year, you've
read about lots of major companies going
out of business: webvan, enron, polaroid,
all managed by older, "experienced" experts,
and yet clients still look for them in vendors
they hire. why? hasn't it already been
proven that these guys are just as bad
as younger, less experienced guys? in
fact, the younger, and less experienced,
the less you can pay them to do more
work for you without a decrease in quality.
think about that.

CONTENT:
1. SEARCH: good services, bad thinking
2. E-ADS: new ad types
3. LICENSING: new revenue opportunities
4. EVENTS: still growing, even more i-shops
5. MUSIC: hiphop is profitable, here's why
6. TRENDS: LGBT, the new old target audience
7. THE WEEK: recap of last week
8. ROUNDTABLE: lets talk about ad agencies

::::: ::::: ::::: ::::: al berrios search ::::: ::::: ::::: :::::

SEARCH: search engines are getting into the
services game by offering subscription services
to help them manage their listings better on
their search engines. goto.com is self-serve,
everyone else charges more in case you're too
dumb to manage your own listing.

BOTTOM LINE: great idea to diversify your
revenue stream. dumb to think that you'd actually
convince businesses that this is a service worth
paying for when there are so many free or value
added services out there that would yield better
results for your money than giving it to a search
engine. and don't think that just any sort of
business should take advantage of these "great
services". as i've indicated in prior newsletters,
there are many different kinds of search engines,
with different kinds of audiences, so it's important
that you invest your search engine marketing
budget on the search engine that's right for your
brand.

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::::: ::::: ::::: ::::: al berrios e-ads ::::: ::::: ::::: :::::

E-ADS: the newest thing is called surround sessions
or sessions, where an ad from the same advertiser
follows a visitor around. the visitor gets an ad dis-
played based on their first click on the first entry
page to a content publishers website. the repetition
and lack of clutter is expected to improve clickthrough
metrics. nytimes first announced, now everyone
wants to try it out. Datapop from CMP media is
also new, by placing a button on top of a traditional
add that allows the user to request more information
about an advertiser. Unicast also gets superstitials
patented, and they're going after phonies with pre-
judice. yes, there are lots of them.

BOTTOM LINE: i think surround sessions will be
successful, if they can get the creative to work with
it. this strategy is definitely in line with an effective
branding experience online. think about having an
ad targeted at you based on the content you choose
to read first. then to have that ad follow you around
wherever you go, nagging you for attention, but
nagging so it doesn't interrupt your experience.
yup, definitely headed in the right direction. Datapop
may take too much education & require content
publisher acceptance to ever be successful. also,
people are not in the habit of looking at traditional
ads anymore, or requesting more information from
them. Datapop claims it allows users to enjoy
content uninterrupted, by having info sent later rather
than having to click on the ad. makes sense, but
approach is off. Superstitials are any ad that has
streaming content in it, whether flash or movie.
if you're not licensing Unicast technology, they
may come after you.

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::::: ::::: ::::: ::::: al berrios licensing ::::: ::::: ::::: :::::

LICENSING: have you bought your new
Michael Jordan Palm yet? not a fan, Christina
Aguilera has a PDA coming out next year.
the world of licensing is as important to your
brand as the price you set. it provides brand
extensions at little or no cost to you, contributes
marketing dollars to your efforts, introduces
new consumers to the brand, & is very profitable.
with such a powerful argument, why haven't
dot coms gotten into the act to bring their brands
to the physical world?

BOTTOM LINE: it's easy to oversaturate
a market, dilute a brand, or allow a new
brand extension to go unnoticed with in-
sufficient marketing. in the dot com hey
day, a promotion was considered a full
marketing effort, demonstrating their grasp
of marketing. not only that, many executives
just don't think of licensing when developing
their brands. it wasn't until eToys started
marketing that they realized they had a
licensable brand in their mascot, the sock
puppet. eToys went bankrupt before being
able to license it; the Monster.com monster
probably won't get licensed either since it
may remind people to go get a job and
might scare little kids; the next best thing
has been animated programs, but interest
has generally remained to licensing programs
with other, larger online partners because
the regularly inappropriate content wouldn't
work offline. and online content publishers
of news experience larger, better staffed
content publishers unwilling to pay for what
they deem as competitive content. so what
is one to do to take advantage of this
potential revenue opportunity? hire a pro.
works every time.

READ MORE:
Dietderich, Andrew "Jordan Palm not a slam-dunk". Advertising Age, December 3rd, 2001. p43

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::::: ::::: ::::: ::::: al berrios events ::::: ::::: ::::: :::::

EVENTS: it seems that the event marketing
industry is the only industry expected to grow
this year. but how does that relate to the internet?
i did a brand awareness campaign for a large
media company where i had my imarketers
interact with over 300 individual community
members in targeted communities and dis-
covered that this company's offline efforts to
promote their events were off target. at first,
i was going to recommend increasing their
online expenditures, however, after further
analysis, we discovered that there were no
communities where one could find residents
of the cities where this company was hosting
events. post-event research revealed that the
target audience that did attend events were
not online, which shed some more light on
the sort of consumer this company actually
reached.

BOTTOM LINE: this company learned that
they were not optimizing their media buy, since
the audience reached did not yield many new
subscribers for this company. the community
members my team interacted with were 72.42%
more likely to subscribe than actual event
attendees, meaning that if this company dedi-
cated more dollars towards online marketing or
changed the location of certain events, their
return on investment would have been greater.

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::::: ::::: ::::: ::::: al berrios music ::::: ::::: ::::: :::::

MUSIC: when you see a Sprite commercial,
Nike commercial, or any ad targeted at urban
african american youth, in the background,
there are always images and sounds of hiphop
culture. creative like this assumes that the
audience most interested in products like these
are young. guess again. if hiphop started with
the youths of 1979, and that first audience is
still interested, then guess what execs, the
hiphop audience also consists of old fogies.
and you know what that means - that hiphop
is more profitable than you thought. also,
artists are signing deals to release their music
as cell phone tones before it hits shelves.

BOTTOM LINE: the older someone gets,
naturally, their purchasing behavior changes.
they are not just interested in sneakers, but
shoes; they consider purchases like cars,
houses, and insurance. but best of all, they
can be reached online, instead of only through
radio. oh, and for the record, hiphop con-
sumers are not all black.

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::::: ::::: ::::: ::::: al berrios trends ::::: ::::: ::::: :::::

TRENDS: companies are discovering that
reaching the gay, lesbian, bisexual, and
transgendered audience online yields more
results than previously thought. with a
5.7 million audience, that is known to be
affluent, early adopters, brand conscious,
and who love to shop, why would an advertiser
not want to take advantage? yes, it helps if
creative is, well, you know, creative. it has
to talk to the audience, since research shows
this audience responds better with very
targeted messaging.

BOTTOM LINE: for the last 20 years,
this audience has been generating some 10%
of corporate profits. but they have not been
entirely comfortable living their lifestyles as
they want. with the advent of the internet,
many have discovered that they can meet
other people of mutual lifestyle from the
security of their homes. the power of the
internet to allow people to interact also
applies to this audience, and guess what
execs, they're ready to spend, if you're ready
to talk to them.

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::::: ::::: ::::: ::::: al berrios theweek ::::: ::::: ::::: :::::

THEWEEK: Enron was making $100B last
year, $0 today, it's collapse meaning investors
can't trust accounting firms or SEC numbers,
Excite@Home stays in business by suckering
cable companies to pay its bills for 3 months,
Paxson wants to block NBCs purchase of
Telemundo, citing breach of contract, watch out
for "Pentagoner" or "Goner" super virus, there's
something about Texas, home of Continental
that laid off thousands, Enron that lost billions,
& Compaq and Hewlett Packard that may lose
merger approval, new ceo of AOLTW, Richard
Parsons, Sotheby's convicted of collusion, 70
year old Polaroid files for bankruptcy, lays off
thousands, continuing wireless play, Earthlink
wants to buy bankrupt OmniSky assets.

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::::: ::::: ::::: ::::: al berrios roundtable ::::: ::::: ::::: :::::

ROUNDTABLE: discussion forum.
there is a severe lack of loyalty at traditional
ad agencies. employees feel more loyal to
clients, demonstrating it by constantly jumping
to the latest firm that wins their client. with
over 20,000 agencies in the US alone, all
competing for the same business, agencies
don't have time to care for their employees.
if a prospective employee has valuable
relationships, that's what matters. anything
else, even 20 years with the agency, will
get eliminated. but how has it gotten this
bad? agencies, apparently, allow clients
to dictate h.r. policy in order to land their
business. sometimes, this includes bringing
over employees from other agencies with
experience working on their brand. i've
always said that this is pointless, since
fresh perspectives on how a brand should
be approached gets squashed. it seems
it's the company brand managers that
demand poor performance, not the agencies
that give it. but i still blame agencies for
allowing a client to dictate something as
crucial for the survival of agencies as h.r.
policy. if not human capital, what else
does an agency have to contribute? by
standing up to clients, keeping and doling
over employees, improving quality of their
services, building relationships with their
agency brand, not the individual, agencies
would win more business, clients would be
happier. what say you?

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::::: ::::: ::::: ::::: al berrios iMarketing ::::: ::::: ::::: :::::

Disclaimer: The recommendations, commentary and opinions published herein are based on public information sometimes referenced via hyperlinks. Any similarities or likeness to any ideas or commentary from any other sources not referenced is purely coincidental. al berrios & co. cannot control any results occurring from advice obtained from this publication nor any opinion(s) conveyed by any reader of this publication.

(c) 2001-2005. All Rights Reserved. al berrios & company, inc. Published by al berrios & co. This Report may not be reproduced or redistributed in any form without written permission from al berrios & co., subject to penalty.

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