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Be Sensible, Not Radical

  |  November 19, 2001   |  Comments

In this age of increasing consolidation, Gunji's been pondering where rich media technology players went wrong -- and how the industry can right itself.

How can you ever hope to breed giants by mating midgets? That's the thought that comes to mind as I see numerous troubled companies in the online advertising space merging in hopes of weathering the current storm.

In the world of rich media, the most prominent example has been MindArrow Systems acquiring rich media pioneer Radical Communications. As one of the true believers in the promise of rich media, I have been thinking about where the industry went wrong. Why have these once-exciting players been forced to cling together to survive? Read on and perhaps you will agree that some of the mistakes are still correctable.

Although companies such as IBM had internal rich media efforts, most of the activity in this market was initially created by venture-funded start-ups. To traditional direct marketers and advertising agencies, many of the claims made by these brash entrepreneurs seemed absurd. Sixty percent click-through and 200 percent pass-along rates -- vendors routinely described case studies with such statistics, while not spending enough time explaining the novelty effect and the fact that such results are not sustainable.

As an industry, we have been drinking too much of our own Kool-Aid. We began to believe that large direct marketers were not smart and that big ad agencies were behind the times. However, there are good reasons why marketers such as Procter & Gamble and Lands' End and agencies such as Ogilvy & Mather reached the pinnacles of their industries. But, unfortunately, we did not listen to them as these giants told us what was wrong with our technology. To be sure, we were aided in our audacity by many of the so-called interactive ad agencies, but many of those are now gone forever and no one misses them.

In an example of the hubris that percolated the industry, former Radical engineer Bill Fulco points out, "Radical would not support Macintosh because it was 'only' 2 percent to 5 percent of the market. They ignored the fact that most ad agencies and rich media production companies are Mac shops. Agencies always complained, 'We can't see our own campaigns on our own computers.' How do you expect to win the hearts and minds of agency powers-that-be when you can't even show them your product working on their own systems?"

I live in Los Angeles, so let me draw an analogy from the entertainment business. Many times I heard local rich media proponents claiming that our technology was going to be like the introduction of the talkies to the silent movie business. Even the name "rich" media implies that what existed previously was somehow less affluent. The sad reality is that the impact of rich media so far is much more like 3-D movies: an interesting curiosity but really a sideshow for zealots and amusement parks. Everyone hates those glasses that you have to wear to watch a 3-D movie, and far too much rich media has suffered from such a barrier.

The barriers to delivery of rich media messages are many. Many consumers check their email (even their POP mail accounts) via a Web-based client while they are at work or traveling: Rich media does not always translate well into Hotmail, Yahoo Mail, or Outlook Express. More than a few corporate IT departments still withhold speakers from the personal computers delivered to rank-and-file employees. Some IT departments continue to block rich media at the corporate firewall. Add to that the fact that lost Internet packets and peak load considerations can lead to a jerky experience in some cases, and you have a situation more uncomfortable than the funky glasses for 3-D movies.

Fulco adds: "Ad agencies need control of rich media and the ability to create their own campaigns in-house" rather than depending on their vendor for rich media creation services. Too many providers still throw this additional barrier in the way of rapid adoption of rich media.

So where will the solutions come from?

First, we must follow the money and listen to the money. This means working with major mainstream marketers -- the Fortune 100 companies and their advertising agencies. Though they are slow to move, these companies have the deep pockets to experiment and to tolerate failure. Once they find something that works, they also have the budgets to spend hundreds of millions of dollars in coordinated campaigns, year in and year out. To do this, however, vendors need to offer complete solutions or be willing to become part of a larger media strategy. Arrogance and impatience have no place in this scheme.

Second, we have to sell only what works without being apologetic or grandiose. For example, I think most rich media messages need to be fewer than 10 to 15 seconds long and be very small in size. Claims to TV-like emotional appeal are seen by customers as absurd and untrue and are therefore self-defeating. The mass of Internet users still connect at narrow bandwidth, and though engineers like me can get all excited about technology that dynamically senses your bandwidth, the reality is that most advertisers and consumers would be better served by a simple message designed for dial-up speeds.

Third, all parties need to become more vigorous about supporting multivendor efforts such as the Macromedia Flash Advertising Alliance (MFAA). Customers need education and standards. Organizations such as the MFAA and the Interactive Advertising Bureau (IAB) should be embraced and encouraged by rich media players. Rich media is mature enough to benefit from forceful standardization -- which simplifies decision making for advertisers and makes creative work more portable.

Rich media is like a feature; some venture capitalists mistook it to be a solution or an industry. I think we are in the process of correcting that misconception. I do believe that the technology will soon become so widespread and commonplace that we might even forget the term "rich media." No one gets excited about calling "long distance" any more. Similarly, marketers and advertisers will think of "IP-based talking, moving images" simply as the way things are done. This might mean that many rich media companies get absorbed into traditional agencies or end up becoming boutique shops rather than independent public entities. But the technology will live on.

So perhaps you agree with me that rich media will thrive in ways that are less radical than Radical Mail proposed. Perhaps you think you could start a company called "Sensible Mail" to show the world how it should really be done. Too late! Ex-Radical engineers have already taken that domain name and URL.

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Gunjan Bagla Gunjan Bagla is an experienced marketer and a seasoned entrepreneur based in California, who advises companies on how to boost revenue by using smart marketing. Previously, he has held vice president positions at a rich media start-up and at a CRM tools vendor. He mastered direct marketing while leading a health care software company to a top three position.

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