January 2000 vol2 What's the Buzz? AOL'S TIME WARNER BUY COULD BOOST BROADBAND, CROSS-MEDIA MARKETING Among the many effects of America Online's pending purchase of Time Warner could be the accelerated adoption of broadband Internet access, and new cross-media marketing opportunities for businesses, according to the two companies. America Online Inc., the largest Internet service provider with more than 22 million subscribers, announced last week that it will buy Time Warner Inc., a media company with cable, publishing, music and film businesses. The company formed by the stock transaction, AOL Time Warner, will be valued at $350 billion and have revenues of more than $30 billion, according to the companies. While much of the coverage of the biggest acquisition ever has focused on its impact on consumers and the companies' stock, there are also ramifications for Internet marketers. Combining AOL's Internet content with Time Warner's cable operations, which can provide broadband Internet access to homes, will speed the growth of the interactive medium, the companies say. "We will accelerate the development of Time Warner's cable broadband assets by bringing AOL's hallmark ease-of-use to this platform," says Bob Pittman president and chief operating officer of America Online. "We expect America Online to help drive the growth of cable broadband audiences." NEW TECHNOLOGIES ADOPTED SOONER The more widespread use of broadband Internet access will likely also speed the adoption of bandwidth-hungry Internet technologies. The companies say combining their resources will help, too. "By joining the resources and talents of these two highly creative companies, we can accelerate the development and deployment of a whole new generation of interactive services and content," says Richard Parsons, Time Warner's president. AOL CEO Steve Case echoed that prediction: "We will fundamentally change the way people get information, communicate with others, buy products and are entertained." For Internet marketers, it will mean hastened acceptance of new interactive marketing tools. And just as AOL Time Warner will be cross-marketing itself to its different audiences, marketers will be able to tap into the new behemoth's multiple audiences, according to AOL's Pittman. "AOL Time Warner will provide companies worldwide with a convenient, one-stop way to put advertising and commerce online as well as take advantage of the best in traditional marketing," he says. For example, AOL will expand the Time Warner magazine content it offers members to include InStyle magazine. In addition, numerous other Time Warner brands, such as CNN.com, as well as music and movies, will be featured on AOL. Time Warner will include AOL disks in promotional mailings and product shipments, and the Warner Bros. retails stores will promote AOL. PAYING ATTENTION TO CUSTOMERS In this edition of WebPromote Weekly, B.L. Ochman examines the customer service policies of some big online players and finds many of them lacking. Plus Shannon Kinnard explores the marketing opportunities offered by email voice technologies. Leveraging Eardrums On The Net Listen up! The hottest new trend developing in the world of Internet marketing is audio ads--pithy, compelling segments delivered to the target audience's eardrums. Imagine this scenario: a business traveler wants to check his email while traveling. He doesn't have access to a laptop or to the Internet, but he does have a mobile phone (or a payphone at the airport). He calls a toll-free 800 number, dials in his individual account number and numeric password and listens to, rather than reads, to all his email messages. But first he has to listen to a short advertisement. Then he can actually respond to his email by recording a message into the phone. The message is recorded, encapsulated into a tiny audio file, and sent back to the person on the other end via email. It seems that as the effectiveness of each new advertising technology begins to wane--such as websites, banner ads, etc.--the next one surfaces. And audio Internet ads delivered via the telephone are definitely on the rise. "What we're seeing right now is very little sound on the Internet, but the capabilities are there, and it's clearly the next trend," says David Williams, founder of 360interactive, an Atlanta-based online advertising firm. Current Internet audio advertising is limited to technologies like Flash banners, streaming MP3s and other audio files, Williams says. "But there's not a lot happening with audio right now. That's because someone sitting at a desk in their office at work, for example, probably has their speakers turned off. So if it's an Internet service delivered through the telephone, you eliminate that problem. Consumers will be listening, willingly, to advertising messages." CURRENT PLAYERS Two companies currently offer free email-by-phone in exchange for a few minutes of users' attention: Excite@Home's Excite Voicemail and General Magic's myTalk. With myTalk, if a user is interested in more information, he can just say "Tell me more" into the phone, and an email will be automatically sent from the advertiser to their account. For advertisers supporting this new vehicle, creative execution is a new ball game. Internet marketers versed in copywriting and graphic design may need to learn the tricks associated with audio ads. "You have maybe 10 to 20 seconds to get your message across," says Tom Shaw, president of Audio Marketing Directions, a voice over and recording studio. "We have to take that into account no matter what advertising vehicle we use. So if you're trying to advertise to people as they listen to their email, use short, memorable soundbytes, like 'Do You Yahoo' or 'Got Milk?'" Shaw's suggestions for creating audio messages: Work with a professional. "There are broadcast production houses that specialize in producing effective advertising for the ears," says Shaw. The audio message needs to be informative, entertaining or both. Use professional voice talent backed by music to improve the impact. Sound effects liven up a short audio ad and drive the message home. Consumers listening to audio pitches while they wait to access their email are captive audiences. "Unlike traditional audio-based radio or TV spots, users cannot channel surf away," says Peter Bentley of myTalk, which signed up 100,000 members in the company's first 100 days. "Their eardrums are captive as they wait to access the service." But because the listeners are captive, "it's really important that the ads are welcome," warns Shaw. "And this means they must be professional, entertaining and meaningful." By Shannon Kinnard Shannon Kinnard is president of email marketing agency Idea Station and author of "Marketing With Email". " Ignore Customers At Your Own Peri In the early days of the Web, visitors used to accept only being able to communicate with a site by emailing the webmaster or administrator. But as more consumers make purchases on the Web, they're demanding prompt replies to their emails, and multiple methods of communication with companies. But online businesses are slow to catch on. A recent Jupiter survey showed that 46% of sites failed to answer email in within five days or never responded. That's up from 38% in an identical survey in the fourth quarter of 1998. Even as they ignore customers' emails, many online businesses provide no alternative means of contact, such as staff names, phone numbers and addresses. Why would a company NOT provide the names of actual human beings to contact? Why are Internet businesses such dismal failures at human interaction? Here are three scenarios. THE WIZARD OF OZ SYNDROME On the Internet, nobody knows the real size of your company. Lots of one-person online companies don't give contact names because they don't want to admit that the "we" they use on their site is actually the royal we. Like the Wizard of Oz, they don't want you to see the man behind the curtain. But these businesses don't realize that people would rather know they are dealing with one person who really cares than a hundred people who don't care. BEAR WITH NO BRAIN SYNDROME Winnie the Pooh said it best. "I have been foolish and deluded," he said, "and I am a bear of no brain at all." One explanation for why companies like Microsoft don't put their phone numbers on their site is because they are afraid they will get millions of calls. That should be their biggest problem. If you want to have a big business online or off, you have to staff up to handle customer calls. Period. CALL OF THE WILD SYNDROME Remember when the three cruel, inexperienced Alaskan Gold Rush prospectors in the book "Call of the Wild" died just moments after they were warned not to continue forward because the ice on the water was too thin? A lot of Internet companies are similarly disregarding warnings and risking their lives with statements like the one on Webtailer's site: "Due to the volume of responses we will not be able to respond individually to your ideas. Be assured that your thoughts are greatly appreciated." Plenty of other sites are equally dismissive of customers, including Listbot, AltaVista, MSN and many more. RESPOND APPROPRIATELY The Web is an instant medium. It requires instant answers. While website owners have devoted plenty of attention to automatic sales systems, the systems that really need help are those that involve human beings talking to and helping other human beings. Companies such as Live Person, Human Click, ServiceSoft Technologies and many others offer live real-time customer support. Some of the products may be primitive, but they are far better than ignoring customer queries. Internet marketers who fail to respond to customer queries may bring about consequences for all. Consumer protest--leading perhaps to legislation--will force Web companies to start treating customers like people, just as phone, utility and cable companies had to in the past. FIRST-HAND SERVICE SLIGHT My recent customer relations experience with Amazon.com is indicative of the problem. Long touted for its responsiveness to customers, this money-losing giant seems to be losing its service edge. When a book I ordered last June didn't arrive after several weeks, I forgot about it. Six months later, the book arrived via UPS. I emailed Amazon to say I didn't recall ordering this book and I didn't want it. They emailed back to say I had ordered it last June. Gee, maybe someone could have emailed me that they had finally gotten the book and asked me if I still wanted it sent. Instead, we exchanged a series of emails, with Amazon defending its position and even outlining for me, in bulleted points, why I was so wrong. Eventually, I griped my way up to a higher level and Amazon agreed to send me a return label for the unwanted book. When I wrote back to say it would have been great if that had happened in response to my first email, someone wrote to apologize and sent me a $5 gift certificate. This sixth email from Amazon was signed by an actual human being. I would have called them to have this exchange, but I could not find Amazon's phone number anywhere on its site. The apology and gift certificate would have been a home run if they had been sent in response to my first email. I'd have gone away praising Amazon's customer-centric culture instead of wanting to order my next book from barnesandnoble.com. Maybe I'll just go around the corner and buy my next book in a real bookstore. Customer service separates the wheat from the chaff in the bricks and mortar world, and it will soon do the same on the Internet. Ignore this prediction at your own peril. Not long ago a Web company told me that they have a "new policy." They answer their phones during business hours without using voice mail. No more voice mail hell for their customers. What a concept! Just watch, any day now more companies are going to give you names and phone numbers. By B.L. Ochman B.L. Ochman is an award-winning marketer who creates dynamic positioning, branding and promotional campaigns for online and traditional businesses. Email, BLOchman@whatsnextonline.com; phone, 212-385-2200. ONLINE SALES OF CONSUMABLE HITS $3.8 BILLION Online sales of consumables accounted for $3.8 billion of the $66 billion in online sales in 1999, and is projected to grow to $9.1 billion in 2000, according to a new report from ActivMedia Research titled "Consumable Products: Building Consumer Loyalty Online." Within online consumable sales, health and beauty products are leading the way, ActivMedia says. Grocery is a new and burgeoning category that has been inhibited by the need to build real-world delivery systems. Only recently has it begun to expand to its eventual potential, ActivMedia says. The report identifies shopping patterns of buyers of consumables online, according to Anne Fischer Lent, senior research associate at ActivMedia. "It's interesting to note that while health and beauty buyers spend the most online overall of the consumables buyers, variations from group to group suggest common threads between markets that lead to cross-selling and promotion opportunities," she says. "For example, pet supplies buyers tend to spend a higher dollar amount on jewelry compared to others within the consumables group and gourmet buyers spend more on travel packages than others within the group.