February 01, 2001

Jupiter Media Metrix announced that small and fragmented wireless and interactive television audiences in the U.S. will limit advertising opportunities on post-PC platforms, making them secondary digital marketing vehicles. According to a new Jupiter Research report released, the post-PC audience (wireless devices, interactive television and Internet kiosks) will reach critical mass by 2005 - however, the PC will continue to dominate with a 74 percent Internet household penetration and 68 percent Internet individual penetration.

Jupiter analysts expect advertisers will be slow to allocate dollars for campaigns on post-PC platforms as they struggle to gain and control the key benefits of advertising on these devices. Jupiter analysts advise marketers targeting the post-PC audience to view them as "modal targets" -- or distinct groups of individuals with similar behaviors and attitudes that stem closely from their use of any Internet-enabled device -- as opposed to the more common audience segmentation characteristics of demographics, geography and gender.

"Marketers that believe they can overcome the limitations of interactive and wireless devices as branding vehicles miss the point. To maximize ad campaigns on these devices, advertisers must isolate and understand the attributes of modal targets, and match the marketing message to the objectives of the consumer using the device - not their demographic profiles," said Marissa Gluck, senior analyst at Jupiter. "Post-PC ad opportunities are a need-to-have for a few categories of advertisers and only a nice-to-have for most."

Key findings and forward-looking analysis from the new Jupiter Advertising & Marketing Report include:

According to a Jupiter Executive Survey, although 77 percent of advertisers spent nothing on wireless advertising last year and 82 percent spent nothing on iTV (interactive television), 36 percent plan do to the same this year for wireless devices and 57 percent for iTV. Based on these findings, Jupiter analysts expect to see only modest revenue increases for post-PC platforms in the near future. Audience fragmentation across different types of post-PC devices and networks will be a major hurdle for advertisers looking to reach customers on these platforms.

While Jupiter expects online ad revenues to reach 16 billion dollars by 2005, post-PC advertising revenues will climb slowly and trail behind -- iTV will reach only four billion dollars and wireless 700 million dollars by 2005. Jupiter analysts believe, however, that while wireless ads have the advantage of immediacy (reaching consumers closer to when and where they may actually purchase), the lack of standards, audience fragmentation and unclear return on investment will inhibit the growth of marketing on these platforms.

Jupiter analysts expect that consumers will demand a high price from advertisers looking to reach them on their mobile phones. In a recent Consumer Survey, Jupiter found that consumers willing to accept advertising on their mobile phone or PDA said they preferred subsidized content and access (36 percent), followed closely by subsidized devices (35 percent). Nearly half (46 percent) of all users, however, said that no form of compensation would persuade them to receive advertising on their mobile phones or PDAs.

How Should Advertisers Approach the Challenging Post-PC Audience?

According to Jupiter analysts, marketers looking to advertise on post-PC platforms must regard each platform as a distinct bundle of users united by common attitudes and behaviors and must evaluate how closely this "modal target" matches their desired audience. Jupiter identifies the following modal targets for wireless, iTV and Web-enabled kiosks:

Wireless - Members of this audience are united by their need for time-sensitive and location-sensitive information. Jupiter analysts assert that they are likely to ignore and perhaps resent marketing messages that are not relevant to the next few activities they may engage in.

ITV - People use this device primarily to be entertained. According to Jupiter analysts, however, these users have only 30 seconds to respond to commercials and will resist being taken away from compelling video content.

Kiosks - Found in shopping malls, retail outlets and other public spaces, Internet kiosks provide the opportunity for users to receive transaction-oriented and brand-oriented marketing messages. According to Jupiter analysts, however, the transient nature of this platform makes complex or lengthy interactions and transactions relatively unlikely.
Jupiter Post-PC Advertising Report Methodology & Definitions

For more information at http://www.jup.com.

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