US companies that take their brands online around the globe without doing their homework are arrogant to think they can easily break into new markets, such as Europe.
US companies often believe that everyone globally will have heard of them and also make a mistake in assuming that the US is the Internet said Kevin O'Connor, chief executive and cofounder of Web advertising services company Doubleclick, during his keynote at Internet World on Tuesday.
In fact, between 30 per cent and 40 per cent of the traffic on the Web is derived from Europe he told the audience. He disagrees that the lack of free local calls in Europe has impeded consumer activity on the Internet because people often make purchases on their PCs at work.
To address the issue of lack of identity of US companies in new markets, O'Connor predicted a surge in cross branding initiatives between organisations across the world.
During his speech he dismissed the idea that television and the Internet will merge but agreed that fragmentation in the Web will continue. The challenge for Internet advertisers will become how to target their messages to an exploding audience.
It is also untrue that Web based consumers are reluctant to give away personal information, but the trick is how to use that information to an organisation's best advantage, he remarked.
He said: "The concept that TV and the Internet will converge is false. The Internet is like electricals systems - the toaster, fridge, microwave all plug into the same base but they won't merge. There's never been an example of two devices merging and the result replacing them. TV is a passive and laid back medium - the Internet is an active and lean forward medium."
O'Connor pleaded with the audience to build a recognisable and trusted brand as differentiators against their competitors, while understanding that moving print campaigns to the Internet will never work. Ads need to be targeted and rich media enables companies to use data they have collected on prospective and current customers to provide real value to the audience, he continued.
For example there is a growth in recommendation engines which learn what consumers like, where they buy and how often and send alerts when something of interest occurs. O'Connor called this method of tracking purchases and making predictions "closed loop marketing" which is significantly cheaper than traditional marketing methods, he added.
His advice to budding Internet advertisers and Web companies was to learn to build on their brand name, to take minority or strategic stakes in Internet startups, and to spin off their online unit.
"Smaller companies love small markets and they attract outside investors," he said.
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