Not since television took off in the early fifties has the nation seen such a technological revolution as the Internet. For a time, Internet usage was literally doubling every month.
There is a relationship between television and the Internet. Each is a communications medium. And nothing on earth affects more people in a more powerful way than the introduction of a major new mass-communications medium.
Over the course of human history, there have been five such introductions:
(While the telephone is a communication device and has had a long-lasting effect on people’s lives, it does not possess the characteristics of a mass-communications medium.)
Life gets complicated. The new medium does not replace the old. Rather, the new medium is layered on top of the old media, forever changing and modifying all of the existing media.
If the Internet is going to take its place alongside the other major media, it will be because it exploits a totally new attribute.
We believe that history will rank the Internet as the greatest of all media. And the reason is simple. The Internet is the only mass-communications medium that allows interactivity. (The organization that was formed to promote Internet advertising is called, appropriately enough, the Interactive Advertising Bureau.)
On the Internet a brand lives or dies in an interactive environment. In the long run, interactivity will define what works on the Internet and what doesn’t work. The secret to branding on the Internet is your ability to present your brand in such a way that your customers and prospects can interact with your message. You’ll have to throw out many of the traditional ways of brand building.
Take advertising, for example. Will traditional advertising be effective on the Internet? Of course not.
Face the facts. People generally dislike advertising. Why do people love the TV remote control or zapper? It allows quick channel surfing when ads appear.
With the Internet, your prospects have total control of what they see, read, and hear. Is there any reason to doubt that they won’t turn off your advertising message as soon as it starts?
Along with advertising, many of the traditional forms of communication are just not going to make it on the Net. Take newspapers and magazines as another example. Why would you assume that you could publish a successful magazine or newspaper on the Internet? Where is the interactivity?
About the only “interactivity” a newspaper or magazine format allows on the Net is the ability to read stories in any order you choose. But you can do that now with a paper publication. (Many newspaper readers start with the sports section. And Playboy “readers” have been known to start with the centerfold.)
Putting a print magazine on radio or television never worked either. Literally dozens of publications tried to take their successful print periodicals into the radio and television arena. They all failed. Why? The essence of radio is the human voice and the essence of television is motion. A printed piece just sits there; it says nothing and doesn’t move.
Slate isn’t the only Internet magazine that is slowly slipping out of sight. Salon magazine was voted the best Website of 1996 by Time magazine, yet the on-line publication continues to lose money: $40 million since its founding in 1995. “The future of media is on-line,” argues Salon publisher Michael O’Donnell. We beg to differ. Print is print; the Internet is the Internet. Trying to combine the two is a serious strategic error.
TheStreet.com is a newspaper format trying to make it on the Internet. In spite of a raft of publicity generated by its cofounder James Cramer, the site continues to generate nothing but red ink. In the year 2000, TheStreet.com had $23.3 million in revenues (mostly from advertising) and managed to lose $69.1 million.
Advertising is drying up on the Internet as more and more companies recognize the futility of advertising in an interactive medium. Where do Internet sites spend most of their own advertising dollars? Surprisingly, it is not on the Net but in the traditional media of television, newspapers, and radio.
One successful publication on the Web is the Interactive Edition of the Wall Street Journal, which currently has almost 600,000 paying readers. One reason for its relative success, of course, is the price. The Interactive Edition of the Journal is a big bargain. While the regular paper subscription goes for $175 a year, the Interactive Edition is just $59 a year and only $29 a year if you are already a print subscriber.
We wonder whether or not Dow Jones would have been better off launching an Internet publication under a different name and with greater interactivity.
Perhaps the most successful Internet publication is Consumer Reports Online, with 590,000 subscribers. That makes sense because “interactivity” is an important aspect of how a subscriber might use the on-line publication. If you want to buy a refrigerator, you can key in “refrigerator” and find out what brands the nonprofit organization recommends. Yet the on-line publication has been a mixed blessing for Consumer Reports. In two years, the number of subscribers to the print publication has dropped from 4.5 million to 4 million.
In this connection, look at the success of 60 Minutes, a television show that was number one in the Nielsen ratings for a number of years. Although 60 Minutes has a magazine-like look, it was created especially for television using a personality-driven format. Furthermore, 60 Minutes did not lock itself into an existing magazine name.
What works in one medium won’t necessarily work in another. As a matter of fact, chances are great that one medium’s success will be another medium’s failure.
The big cable television brands—HBO, ESPN, CNN, A&E, MTV, QVC, Showtime, and Nickelodeon—were not line extensions of broadcast brands. They were new brands created especially for cable.
Yet too many companies lock themselves into the past. They look for ways to use yesterday’s name on tomorrow’s medium. News Corp., for example, the owner of TV Guide magazine, is using the TV Guide name on a cable channel as well as an Internet brand called TV Guide Online. Neither strategy is going to work very well.
If you want to build a brand on the Internet, you need to build a new brand designed specifically for the new medium. In other words, you have to build interactivity into your site, and you generally need a new name.
It bears repeating. The difference between the Internet and every other medium is interactivity. Unless your site has this crucial ingredient, it is going to get lost in cyberspace.
The competition is intense. There are already many more dotcom Websites than there are registered trademarks filed in the United States.
Interactivity is not just the ability to select from a menu. (You can do that with a book or a magazine by looking at the index. You can also do that with a phone by pressing numbers. You can do that in a restaurant by asking for the wine list.)
Interactivity is the ability to type in your instructions and have the site deliver the information you requested in the form you requested it. Check out Amazon.com. Type in a subject and the site will present a list of books that match your category. You can do the same with authors or a title.
(Instead of asking for the wine list, try asking the sommelier for a list of all French red wines that cost less than $40 a bottle. There’s no interactivity in a restaurant menu and no sense of humor in a sommelier.)
Interactivity is also the ability of the site to furnish additional information based on your original query. Select a book to purchase at Amazon.com and the site will give you the names of at least three other books bought by previous buyers of the book you ordered.
Interactivity is also the ability to add your own information to the site. The best Internet sites are two-way streets. At Amazon.com you can rate books by giving them anywhere from one to five stars, and in addition you can submit short reviews, which are posted within hours under the book you reviewed.
Interactivity is also the ability of a site to handle complex pricing situations almost instantaneously. Take airline tickets, for example. An airline site is able to select from a multitude of fares, flights, dates, and conditions and give you a price on the spot, which you can either accept or decline. They can even recommend a flight schedule that offers the lowest priced fare. (The Cisco site is another Internet operation that makes good use of this on-the-spot pricing technology.)
Interactivity is also the ability of the site to perform a wide variety of tests: intelligence tests, driving tests, occupational aptitude tests, psychological tests. Some of these areas are going to turn into big brands and big businesses.
Interactivity is also the ability of the site to conduct auctions of all types. Priceline.com and eBay are two big brands that have already taken advantage of this capability. (Currently eBay is worth $12 billion on the stock market. And Priceline.com is worth $672 million.)
Interactivity is also the ability of the site to diagnose a situation and suggest remedies. We worked with a famous personality to develop a personal Website. The first screen was going to be a menu of various problems that an individual might be experiencing.
“Don’t do it that way,” we suggested. “Make the screen interactive. Ask the person a series of questions, then let your computer tell the individual what his or her problem might be.”
Interactivity is a powerful metaphor for the patient-doctor or the student-teacher relationship.
You visit a medical doctor and describe your symptoms. The doctor diagnoses your problem and prescribes appropriate treatment. This is the kind of interactivity that is possible on the Internet.
Will the Internet spawn successful medical and educational brands? Why, of course. These are disciplines based on interactivity.
CapellaUniversity.com, for example, offers five hundred courses in forty areas of specialization, including an MBA program with extensive instruction in e-business operation and management. You can be sure there will be many more Capellas to come.
Contrast correspondence courses by mail with Internet educational ventures. The best that current correspondence courses can accomplish is a weekly or semiweekly dose of interactivity. The Internet can greatly speed up the process.