App-vertising: Reach Users via Online Applications

In the spirit of bold experimentation, I’m writing this week’s column in part using an online word processor (Google‘s, to be specific). In essence, the experience isn’t much different, on the surface, than using a regular word processor on my own hard drive. But in a broader context, this is a pretty big deal.

Web 2.0 is a buzzword with a thousand definitions, but of the two or three that are the most meaningful (in that they represent a significant shift in how we think about the Internet), the one I like is that the Web now holds not only sites (pages with content), but also applications (locations with functionality). Personally, I like my technology small and inconspicuous. I’ve never attached a phone or PDA or anything to my belt, preferring to shove the devices into pockets and backpacks. When not in use, I close my laptop and put it on the shelf, on its end, like one more book. I like it when devices disappear.

The concept, then, of functionality moving off the machine and onto the network is extremely attractive to me and the rest of my tech-hiding cohorts. We can see, from their movements that Google and Microsoft are looking to serve us as well. Google in particular seems to be interested in building out (or buying companies that offer) real online functionality, including word processors, spreadsheets, presentation tools, and, of course, e-mail apps. If you expand your definition of application, you could also consider blogging software, photo apps, even maps to be part of this trend.

We’re becoming an online audience of doers, not consumers.

What Does This Mean for Advertising?

Advertisers must pay attention to how the Internet shifts in consumers’ minds, of course. Advertising on the Web has never been about simply placing a message in front of as many people as possible. Not good advertising, at least. Good online advertising integrates the brand message into an overall experience. This is why search is so effective; the ads actually provide relevant results and help consumers get closer to answers they seek.

What should advertisers do with applications, then? Is there such as thing as “app-vertising”? At first blush, the answer would be no. Imagine getting ads in the middle of working out your quarterly revenue in Excel. Yikes. Talk about interruptive.

But consider e-mail. Reading or writing e-mail is a pretty focused activity. Ads have very effectively been integrated into that experience. It’s a pretty straightforward placement, however, either via CPM (define) or contextual. The depth of involvement in applications such as word processors should offer advertisers new opportunities.

Not many of these services offer significant advertising opportunities yet, but that may simply be because the world is too new. Presumably, opportunities will emerge. Google is a media company, after all. It makes nearly all its money from selling ads. People using an online, free word processor are a pretty captive audience and, therefore, of value to advertisers.

Reaching people with ads inside of applications will be a slow, measured process. Heaven help us if Clippy, the universally loathed Microsoft Office assistant, suddenly shows up to pitch a low mortgage rate. Clearly, that won’t fly.

You can imagine offers that could potentially be relevant and helpful. But that may be a small set of ads. If you’re working in a spreadsheet, you may be interested in currency conversion or a unique charting application. But beyond those sorts of helper ads, what’s the real opportunity?

Ultimately, it may be that functionality development, at least by the big publishers, is simply a play for audience, which could perhaps be leveraged in other properties. And there are always gateway pages (where you save documents, for example) that may present new ad opportunities. The challenge, however, is it smacks of the dot-com bust’s discredited eyeball strategy: get them in and figure out what to do with them later.

The Best Place for a Brand

In the world of online applications, the best place for a brand may just be on the sidelines. Or on the fringe. If we know people are going to an online word processor to write documents, for example, a brand could launch a CGM (define) contest within the service: use the service to write your best story about using our brand. We’ll pick the best one. A brand could provide assets within the service, such as templates, copy, or spreadsheet formulae. Marketers must find a way to leverage the flow of people to these services and give them something unique to do there.

This gets us back to that core online advertising notion: understand what experience is being sought, then find a way to make it a lot better.

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