Forrester Research: Forrester Retail Insights Devices, Media, & Marketing First Look: Research & Event Highlights From Forrester

 16 July 2003
Consumers love search . . .
More consumers are relying on search to navigate the Net. Thirty-eight percent of consumers use Google regularly -- an increase from only 23% a year earlier. Who loses? Portals like Yahoo!, AOL, MSN, and Netscape.


. . . and so do marketers
Beyond being useful to consumers, search is fast becoming the most effective online marketing vehicle. That's a big reason why Yahoo! bought Overture this week. Smart marketers look beyond buying keywords, focus on site optimization, and use SEMs like Performics and TrafficLeader to boost results.


Hot Off The Presses
Migrating Users From Free To Paid, by Chris Charron
Benchmark June 2003 Data Overview: Covers Forecasts, Devices, Broadband, Online Activities, Telecom, Finance, and Retail, by Jed Kolko
Getting The Most Out Of Search Marketing, by Charlene Li
Do You Know Which Consumers Want Your Email? by Jim Nail


Fascinating Factoids
15: Percent of AOL site users that don't use AOL as their ISP. Seventy-six percent of MSN.com users don't use MSN as their access provider.
8.4: Hours the average online user spends online per week -- down from 9.5 hours per week two years ago.
58: Percent of online consumers who say they regularly play games alone online -- the third most popular online activity. Only 19% of online consumers routinely say they play games with others.


Gays: A Marketer's Dream
Gays are wealthier, better-educated, influential, trend-conscious, avid Internet users, and more likely to adopt technology. Targeting this small but influential group requires crafting gay-friendly messages and using sites and technologies that gays use like TiVo, Apple's iPod, or Web site hosting services.


Improve Your Email Results
"Great seminar!" "Very valuable." "Great examples." "Thought-provoking ideas." "Well worth the time." These are just some comments from recent attendees of "Forrester's Email Boot Camp," which provides best practices, case studies, practical tools, and industry benchmarks that will help you get the most from your email efforts. To find out more information about our upcoming Cambridge and San Francisco boot camps, contact Kim Toedtman at kchaskey@forrester.com.


Mobile Phones And TV Grab Top Revenue
Mobile Phones And TV Grab Top Revenue

Search
Search Forrester's Web site.

 

BYOA: birth of a new services layer

Large portals like AOL, MSN, and Yahoo! are heading fast and furious toward the newly dubbed bring-your-own-access (BYOA) market. The commotion has Internet service providers worried, portal executives hopeful, and consumers confused.

What is BYOA? Think of BYOA as simply a layer of basic content and services delivered to consumers online. It's an attempt by the major portals to create a business around search, directory, personalization, communication apps like email and IM, shopping, basic content like news and weather, and whatever else they can throw in that they hope consumers will pay for. These services used to be given away by AOL, MSN, and Yahoo!, but BYOA is a new business born of necessity as the Internet access market has grown more competitive with the arrival of broadband.

Will it fly? For the most part, yes. BYOA taps into parts of four revenue pools: online content (estimated at $1.3 billion last year by the Online Publisher's Association and growing for a second consecutive year at nearly 100%), Internet access ($27 billion), fees from communications services ($40 billion), and Internet browser software. MSN, AOL, and Yahoo! are literally creating a new market from an amalgam of previously separate or nonexistent sources of revenue. That accounts for the excitement -- and paranoia -- on the part of some ISPs and telecom providers.

Consumers Want Exclusive Content BYOA success won't be easy

To succeed with BYOA, major portals need to focus on two areas.

First, usability. A sneak peak of AOL 9.0 reveals big improvements over the feeble 8.0 in the areas of safety, security, privacy, and ease-of-use. It will offer automatic email updates, lifetime email storage, and enhanced parental controls. And MSN's new product update this summer will be more communications-centric than content-centric.

Second, unique content and features. As the figure above shows, offering exclusive content or features is the best way to get consumers to part with cash. Expect AOL to further promote its Time Warner content as a free feature, Yahoo! to promote its unique search capabilities with Overture, and MSN to capitalize on unique integration with MS Office and Outlook.

We'll keep following developments in BYOA, making the calls on winners and losers. We've also got some other great research under way. In early August, look for the results from our survey with young consumers (12 to 22 years old) about their online content activity, such as downloading music and video and burning CDs. We will also publish our report, "Benchmarking Your Email Campaigns," which will provide open and click-through rates by industry and type of email -- a good chance to grade your own efforts.

Have a great month!


Chris Charron
Devices, Media & Marketing Group Director

P.S. I'd love to hear from you -- about our research, challenges you face, research you'd like us to write, or data points you are looking for. Drop me a line anytime at chrischarron@forrester.com.


Research Referenced In This Issue
If you printed this email, get links to the research featured in this week's issue by going to www.forrester.com/go and entering the five-digit number of the report you'd like to read.

AOL: Focus On Broadband Or Fade Away (15009)
Benchmark June 2003 Data Overview: Covers Forecasts, Devices, Broadband, Online Activities, Telecom, Finance, And Retail (16730)
Connectivity Splits The Gaming Industry (16071)   
Do You Know Which Consumers Want Your Email? (17003)
Downloads Save The Music Business (14854)   
Gays Are The Technology Early Adopters You Want (17004)
Getting The Most Out Of Search Marketing (16726)
Migrating Users From Free To Paid (16069)   
MSN 8 And SBC Yahoo! Will Dent AOL (15851)
Sizing US Consumer Telecom (12812)   
This Is Not Your Teenager's Instant Messaging (14929)   
Three Tiers For Broadband (13413)   
Verizon's DSL Price Drop Starts A War It Won't Win (16793)
What Content Will Consumers Pay For? (15717)
Yahoo! Buys Overture; All Eyes On Google (17164)

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