You’ll also be able to find surprises by following links other people have set up. Today, users like to browse the Internet’s World Wide Web, checking the display pages or home pages that include links to other pages with information about a company or links to other companies’ pages. These links are indicated by hot spots, those pictures or buttons that, when clicked with a mouse, cause the requested page to be called to the screen.
Some individuals are creating their own home pages. Personal home pages are interesting to consider. What data or thoughts would you want to publish to the whole world? Will your page have links, and, if so, to what? Who will want to look at your home page?
The electronic world will allow companies to sell directly to customers. Certainly every company will provide a home page to facilitate access to information about its products. Any company that has a successful distribution strategy—in our case, software retailers—has to make a choice about whether to take advantage of this. Putting up the latest information, including the names of your distributors, will be very easy, but it’s also important to protect retailers. Even Rolls-Royce, which has an extremely exclusive distribution system, will probably have a home page where you can see its latest models and find out where to buy them.
Retailers have done a very good job for Microsoft, and we like the fact that customers can go into stores and see most of our products and the salespeople can give them advice. Microsoft’s plan is to continue to sell through retailers, but some of them will be electronic.
Consider an insurance company that has worked effectively through agents. Will the company decide it wants customers to buy directly from the central office? Will it let its agents, who used to sell locally only, sell electronically nationwide? Sales requirements will be tough to define. Each company will have to determine what factors matter most to it. Competition will show which approach works best.
Home pages are an electronic form of advertising. The information highway’s software platform will allow companies total control over how information is presented. Advertisers on the information highway will have to be creative to capture viewers who will have grown accustomed to watching whatever they want, whenever they want, and to being able to skip through almost any program.
Today, advertising subsidizes nearly all of the programs we watch on television and articles we enjoy in magazines. Advertisers place their messages in the programs and publications that attract the largest appropriate audience. Companies placing ads spend a lot of money trying to make sure their advertising strategy is working. On the highway, advertisers will also want some sort of assurance that their messages are reaching their targeted audiences. Advertising doesn’t pay if everyone chooses to skip by the ad. The highway will offer alternatives. One might be software that lets the customer fast-forward past everything except for the advertising, which will play at normal speed. The highway will possibly offer the viewer the option of asking to see a group of commercials. In France, when commercials were grouped and aired together, that five-minute block was one of the most popular time segments.
Today, television viewers are targeted on a cluster basis. Advertisers know that a television newsmagazine tends to attract one kind of viewer and professional wrestling another. Television commercials are purchased with audience size and demographics in mind. Ads aimed at kids subsidize children’s shows; those aimed at homemakers subsidize daytime soap operas; car and beer ads subsidize sports coverage. The broadcast advertiser is dealing with aggregated information about the viewers of a show, based on a statistical sample. Broadcast advertising reaches many people who aren’t interested in the products.
Magazines, because they can be and often are narrowly focused editorially, are able to aim their advertising at somewhat more targeted audiences—car enthusiasts, musicians, women interested in fitness, even groups as narrow as teddy bear fans. People buying a teddy bear magazine want to see the ads for teddy bears and their accessories. In fact, people often buy special-interest magazines as much for the advertising as for the articles. Fashion magazines, for instance, if they’re doing well, are more than half advertising. They offer readers the experience of window-shopping without the walking. The advertiser doesn’t know the specific identities of the magazine’s readers, but it knows something about the readership in general.
The information highway will be able to sort consumers according to much finer individual distinctions, and to deliver each a different stream of advertising. This will benefit all parties: the viewers, because ads will be better tailored to their specific interests, and therefore more interesting; producers and on-line publications, because they will be able to sell advertisers focused blocks of viewers and readers. Advertisers will be able to spend their ad dollars more efficiently. Preference data can be gathered and disseminated without violating anyone’s privacy, because the interactive network will be able to use information about consumers to route advertising without revealing which specific households received it. A restaurant chain would know only that a certain number of middle-income families with small children received their ad.
A middle-aged executive and her husband might see an advertisement for retirement property at the beginning of an episode of Home Improvement, while the young couple next door might see a family vacation advertisement at the opening of the same show, regardless of whether they watched the show at the same or a different time. These closely targeted advertisements will be of more value to the advertiser, so a viewer could subsidize an entire evening of television by watching a small number of them.
Some advertisers—Coca-Cola, for example—want to reach everyone. But even Coca-Cola might decide to direct diet cola ads to households that have expressed an interest in diet books. The Ford Motor Company might want affluent people to be shown a Lincoln Continental ad, young people to see a Ford Escort ad, rural residents to watch an ad for full-size pickup trucks, and everyone else to be sent a Taurus ad. Or a company might advertise the same product for everyone but vary the actors by gender or race or age. They will certainly want to revise the copy to target particular purchasers. To maximize the value of the advertising, complex algorithms will be required to allocate ad space within a show for each viewer. This will take more effort, but because it will make the messages more effective, it will be a good investment.
Even corner groceries and the local dry cleaner will be able to advertise in ways they never could before. Because individually targeted ad streams will be flowing through the network all the time, video advertising is likely to become cost-effective even for small advertisers. A store’s ads might target only a few blocks and address very specific neighborhoods or community interests.
Today, the most effective way to reach a narrow audience is with a classified ad. Each classification represents a small community of interest: people who want to buy or sell a rug, for example. Tomorrow, the classified ad won’t be tied to paper or limited to text. If you’re looking for a used car, you will send out a query specifying the price range, model, and features that interest you and will be shown a list of the available cars that match your preferences. Or you will ask a software agent to notify you when a suitable car comes on the market. Car sellers’ ads might include links to a picture or a video of the car or even the car’s maintenance records, so you can get a sense of what shape it is in. You’ll be able to learn the mileage the same way, and whether the engine has ever been replaced, and if the car has air bags. Perhaps you will want to cross-link to police records, which are public, to see whether it has been in a wreck.