There has never been so much change in the way people communicate than there is right now. New generations use tools their parents don’t even understand, and young people consume news as easy as they create and publish it themselves. These shifts in communication will undoubtedly have consequences for the communication industry. Can advertising campaigns still be based
on a mix between 30 second tv commercials, print ads in top-down media and below the line activities?

Roughly five years after the burst of the Internet bubble, developers and investors are regaining trust in the World Wide Web. But not in the web as we know it. This time it’s about conversation, cooperation, and empowerment of the masses. This time it is
bottom-up, instead of top-down. People are taking back the web that companies have been trying to commercialize for the past 10 years, without much success. This time, the web is going social. Within the Internet community, this new, grown up version of the web is called Web 2.0.

If we combine the social aspects of new web applications (which I will explain later on) with technological developments such as the ever dropping price of hardware, the rise of wireless communications and the massification of mobile phones, we can start to see mayor changes in a lot of aspects today’s advertising relies on to be effective. This paper intends to explore these changes.

What’s the effect of an advertising campaign, in a world where every consumer has instant access to all hard data about any given product? How can we even reach these consumers in a media landscape that consists of millions of personal blogs, podcasts and time shifted television? What is the role of marketing when consumers are directly connected to almost anybody within the companies they buy from? In this paper I will attempt to provide some answers (or at least clues), but for now, the best way to be prepared is to simply be aware of the fact that things are changing. Something has been set off, that is impossible to stopped. And it will force advertising to reinvent itself in quite a few ways.

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The Internet is taking off. Again.

Everybody remembers the burst of the Internet bubble at the end of last century. Many companies are still very cautious and skeptical after the losses they had to take on their Internet investments, and E-commerce never did fulfill the expectations. But today, the Internet is growing mature. A new Internet is being developed right now. Investors are regaining faith and little start ups are emerging. What’s different this time?

This time, the Internet seems not to be about the money (at least, not directly). Instead of companies trying to find out how to expand their business to the web, todays most popular web services are about sharing information and connecting people. Ideas are becoming more important than business models. The people are taking back the web that companies have failed to make theirs. A lot of advertising agencies have already closed or sold their Internet departments, the same departments they set up (or
acquired) in panic when their clients started worrying about Internet presence.

The panic that struck advertising agencies and their media departments in the nineties, seems to have transformed into a state of comfort. Internet did not keep its promises and everything has gone back to normal again. But what really has been developing after the bubble, is a type of Internet that is far more dangerous to the advertising industry than the previous one. This new type of Internet undermines the very principals advertising has relied on for decades, such as information-asymmetry and top-down
content delivery.

Not only the incredible amount of information available on the web will tread these principals, but mostly the social aspect of it. Now, everybody can add information in an extremely easy way, such as writing a weblog. Everybody can read and recommend blogs or blog posts and contact their authors. Every little piece of information is tagged accordingly and every consumer can search all these micro media more efficiently than ever before. Huge groups of people work together (whether they’re aware of their cooperation or not) in order to have good content come forward and bad content being overshadowed. People will be able to review and rate everything, in order to make this enormous stream of information more efficient and more relevant.

All these features of the new Internet are described in Tim O’Reilly’s definition of the so called Web 2.0:


Mobile technologies

Until now, we have known the Internet as part of our desktop or laptop computers. Some have it on their portable devices, but that is actually the ‘static’ web on a moving device. What we will see in the future is broadband on mobile devices, and applications designed especially for mobility. This will make geographic contextual information possible and, of course, geographic contextual advertising. But it will also allow people to instantly read peer reviews about the shop or office they are about to enter, or receive offers from a restaurant in the street they are actually walking in. How far these kind of geographically aware technologies will actually be able to flourish will mostly depend on political decisions about privacy matters, but the advertising industry should be anticipating them anyway.

When broadband reaches mobile devices (which is already happening), the mobile phone will do for the Internet what the telephone did for the telegraph: to make it a truly mainstream technology2. Mobile phone penetration is already outnumbering PC ownership, and the renewal rate of mobile phones is high, triggered by new technologies constantly emerging. This phenomenon of masses having access to mobile Internet will only amplify most of the effects I will discuss in this paper.

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During the past 5 years, one of the most profound social effects of the Internet has been the democratization of media. Nowadays, anybody with a computer and an Internet connection is ready to start broadcasting to the whole world, for free. Online tools such as the well known Blogger (created by PyraLabs in 1999 and acquired by Google in 2003) make publishing on the Internet extremely easy and accessible to people with hardly any technical knowledge. The phenomenon of democratized media results in a landscape of millions of micro-media, most importantly in the following forms:


The first three of these new forms of media come with a universal technology for distributing content over the Internet: RSS. RSS is a very important part of all three technologies, as it allows consumers to literally subscribe to content.


What are the consequences?

Combinations of these technologies are leading to a complete democratization of media. Individuals find themselves with the same possibilities as mayor newspapers, groups start weblogs that compete with global content distributors, and online radio stations emerge. The cost of broadcasting has never been so low. Everybody with a PC and an Internet connection can not only access all traditional media from all over the world, but also the micro-content added to the media landscape by individuals. Millions of people have evolved from being mere media consumers to being media producers as well.

How effective are mass media when we all have a medium of our own?

It is very clear that traditional media are loosing their grip on their audiences. As a result, consumers will be extremely difficult to reach, as they will be scattered all over this landscape of micro-media. Instead of reading the mainstream local newspaper, they will read micro-content written by someone with the same interests they themselves have. For news, they will rely on RSS feeds from local and global news sources, directly to their RSS readers (they will click through to the newspapers website, but only if they find something interesting). In their cars, they will be listening to a podcast about a topic so specific that mainstream radio could never afford to spend time on it.