Explore the Advertising Opportunity
You’re facing increasing pressure to build-out your network to support higher bandwidth requirements, more data services, and more applications over more devices. Competition on pricing and widespread use of “free” OTT fixed and mobile Internet service delivery models are limiting your ability to generate revenue. You need to change the game and become a serious player in a growth opportunity: digital advertising.
In their 2008 Next Generation Advertising Study, Heavy Reading asked service providers if “Generating incremental revenue from advertising will be a critical requirement for service providers within the next five years”. Almost 90 percent of you said it would. But to succeed in the digital advertising market, you’ll need to meet the needs of the other two players: advertisers and consumers.
What advertisers want
About half of current advertising budgets are spent on traditional advertising (print, radio and television), but that market is flat. Traditional media simply don’t provide the ROI advertisers are looking for. They are looking to digital advertising to address this gap.
Digital advertising offers the personalization needed to improve targeting and relevance, along with interactivity to increase response rates. Done right, digital advertising can reach the mass audiences valued by brands. The ability to measure campaign responses is also highly valued. With well-executed digital advertising, brands can be sure they are reaching the right person with the right message, on the right device, at the right time.
What consumers want
Today’s discerning consumer is looking for a more relevant, engaging experience. In 2009, Alcatel-Lucent conducted extensive research into end-user behaviors and preferences. Key takeaways from that study are:
Make it personal: Young consumers are most receptive to ads that are personally relevant, based on their specific interests.- Give them control: They’ll share personal information but they want control over what they share and how much.
- Make it interactive: Give them opportunities to engage with ads and express their opinions, such as “thumbs up/thumbs down” voting systems.
Different screens, different opportunities
IPTV is growing rapidly, and so is the potential for IPTV advertising. With IPTV, you can leverage your network assets and your subscriber relationships to help advertisers deliver targeted, relevant messages. The Alcatel-Lucent Personalized and Interactive IPTV Advertising Solution enables you to become an integral part of this advertising revenue chain, while adding value for your subscribers.
Although Internet advertising is growing rapidly, right now your opportunities for revenue are limited. Much Internet advertising is in the search market, controlled by a small number of players. Video over the Internet is huge and could provide an opportunity for advertising, if you could offer targeting and personalization. Currently, though, regulatory restrictions and consumer reluctance to share information online are limiting that potential.
Mobile advertising is an exciting new opportunity. The mobile advertising value chain is still evolving, and your company could gain a strong position in it by becoming an early adopter. But to attract advertising budgets your way, you need a compelling offer with a measurable ROI so advertisers can clearly see the added value. We believe the Alcatel-Lucent Optism™ Mobile Advertising Solution, which relies on opted-in subscribers who state their preferences, enables you to take full advantage of the mobile advertising opportunity.
You can leverage your success in the mobile advertising market to establish yourself in the other digital advertising markets. By extending your permission and preference-based media inventory from mobile to other screens, you can offer advertising services across the consumer’s screen of choice, whether that’s a TV, a computer or a mobile device.