All the Right Digital Moves

This week our digital team hosted an evening for some senior friends of the business, giving them food for thought on the digital landscape right now. Here's a taster of what we talked about.

One of many interesting developments is the money being made by selling virtual goods -- stuff you consume in a virtual environment like furniture for your virtual house in Sims or branded clothes for your avatar.

There's a company in south London that has made £500,000 in the last year selling dance moves. Different dancers come into their office, do their stuff with electrodes on (in the same way they got Gollum to move so well in 'Lord of the Rings').

The moves are captured and translated into computer code. You buy a groovy move for 50p which helps you stand out as pretty cool when you are next hanging out in Second Life. This company was in profit from its first month and now has 18 employees.

The great insight is that it's normal behaviour -- people have always wanted to express themselves in a social context and online is no different.

Digital advertising
Display advertising is in the dark ages -- banner adverts and paying for basic click-throughs is rapidly viewed as an old, offline model.

Social networks are unable to effectively monetise their traffic -- both YouTube and Facebook are falling short of ad revenue expectations and their attempts at context-driven ads are ham-fisted and an irritant to users.

Search as an advertising model is in its prime and is continuing. The future of digital advertising will be about providing real consumer benefit. Here are three ways to ensure this:

• Utility is key -- something that consumers want to use, but also be part of, contribute to, and of which they feel some sense of ownership.
• The power of free -- an explicit deal with customers to get free goods and services in return for viewing targeted ads
• Make it entertaining -- don't the forget the basics. You have to create something entertaining to engage consumers in the first place
• Snippets or games.

The next stage is commercial co-creation -- where companies ask customers to participate in developing new products and services. This is when open innovation works hard for brands worldwide.

Here are some tips for becoming successful:

1. The right people. Ask a targeted group, not the whole world.
2. Specificity. Get specific about what you want them to create.
3. Insight. Give them useful insights to help them develop ideas.
4. What's in it for me? Make sure there's an explicit deal with the customer be clear about what are they going to get out of it.
5. A great experience. Give your customers a great experience in participating in the creation of new products or services.