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Simon van Wyk looks into the rising popularity of online peer-to-peer lending

According to the Wall St Journal, which cites Online Banking Report, a US-based research firm, about US$100 million in new person-to-person loans will be issued this year, and that will increase to as much as US$1 billion in new loans in 2010.

Of course, people have been borrowing money from each over for generations - families, friends and neighbours lend amongst themselves – and because of their close relationships, trust is not an issue. Now with the growth of the Internet, and the sophistication of online verification and credit checks, the emergence of peer-to-peer lending sites means there’s an infrastructure to go with it, and the lending and borrowing can now happen amongst strangers.

Consumers are flocking to peer-to-peer lending sites

It’s easy too understand why consumers are flocking to peer-to-peer lending sites like Zopa and Prosper and their increasing number of clones out there.

People are always looking for lower interest rates on loans and being able to sidestep the banks to achieve their goals is naturally compelling. At the same time everyone wants higher yields on their liquid assets. And more and more people are moving nominal savings out of the trusty, low yielding savings accounts and into the person-to-person online market to achieve significantly higher returns. It’s certainly an interesting way of diversifying their portfolio and earning money. Also playing a hand in the person-to-person lending revolution is that young people love social networking. And the idea of organised lending through such sites sits very comfortably with them.

Prosper has something like 330,000 users and has funded $70 million in loans. Meanwhile Zopa claims to have 150,000 members and that by bypassing the banks – they can offer competitive borrowing and lending rates with lenders looking at returns of up to 14 per cent and borrowers accessing loans with interest rates as low as 6 per cent.

Virgin USA enters the game

No surprise then that in May, some real financial muscle entered the game when Virgin USA, Sir Richard Branson’s North American investment group, purchased a majority stake in another peer-to-peer lending company, CircleLending which has been around since 2001.

The press release announcing the purchase quoted Frances Farrow, CEO of Virgin USA who said: “Financial consumers are increasingly self-directed, empowered and seeking the kinds of innovative alternatives offered by CircleLending. We’re delighted that our investment will form the foundation for a major new Virgin-branded financial services offering in the U.S.”

As the press release stated: “Our investment in CircleLending is consistent with Virgin’s focus on developing fresh approaches to consumer issues and challenging the status quo.”

Meantime, also making news in May was Facebook, the online social network which is rapidly becoming as popular as MySpace, when it launched its person-to-person lending service through Lending Club. With a view to making peer-to-peer lending more mainstream, Lending Club on Facebook has issued over US$100,000 of loans since its launch. The company generates revenue by collecting a one-time processing fee of 0.75% to 2% of the loan amount from borrowers and a processing fee of 1% of the installment amounts from lenders.

New clones in the online peer-to-peer lending space

Meanwhile across the globe, seeing the potential size of this market, other players are entering the online peer-to-peer lending space. Earlier this year, Dutch-based Boober.nl launched promising “no banks, better deals” and has made quite an impact. It has already funded loans totaling almost 1 million Euros.

According to Springwise, Boober’s founder, Guus Drijver, is very forthcoming as to why Boober is better for consumers than the banks. “Boober doesn’t work with hidden costs and is completely transparent. We don’t sponsor yacht races or soccer teams, and don’t have expensive headquarters or pay thousands of people high salaries.”

Hot on Boober’s heels, but not growing quite as fast is Germany’s, smarva.de with loan volumes over its first three months totaling 150,000 Euros, servicing about 50 loans. One reason for the slower growth is that about 70 to 80 percent of all borrower applicants are declined because of its strict validation process which includes calculating if the borrower’s financial situation is well enough to allow repayment of the desired loan sum.

Online peer-to-peer lending also looks like it’s also about to take hold in China with PPdai about to launch there. In China loans from family and friends are more commonplace than personal loans from banks, so the website will aim to facilitate such loans within a more formalised structure.

And coming soon to Canada, CommunityLend will open up its online community later this year revolutionising the way lending works in Canada.

Of course all these peer-to-peer lending sites have in common is that they service relatively small personal loans – certainly sub $10,000. And with peer-to-peer companies making their money through the fees they charge based on a percentage of the loan value, they are going to have to service a huge number of loans to become profitable.

That said, is it too far-fetched to see the peer-to-peer marketplace expanding and launching services for homeowners to finance purchases or refinances? Will we see prospective homebuyers logging on to a peer-to-peer lending site to request home loans in the order of $800,000 or more, stating the interest rate that they are willing to pay?

Maybe that’s for the future. But it’s undeniable that there is a lot happening in the online peer-to-peer lending space which may force wide reaching changes in financial services. It will be interesting to see what develops of the Virgin US acquisition of CircleLending.

Simon van Wyk is Founder of HotHouse Interactive. Comment on this story at the HotHouse blog.

Wikis are a powerful way to unleash the creative power of collaboration, as long as you can get used to the idea of being out of control as Simon van Wyk writes.

Late last year I was asked to write a piece for the ‘My Five’ column for The Australian Literary Review, where I nominated the five books that had most inspired me in my career. Arguably the most influential title was The Cluetrain Manifesto, written by four Internet pioneers from the US and published in 2000.

The ‘manifesto’ is comprised of 95 theses – reminiscent of 16th century German theologian Martin Luther, whose same number of theses formed the basis of the Reformation movement that took European civilisation out of the Middle Ages and set up Protestantism as an alternative to Catholicism.

So what the hell does Internet marketing have to do with European religious struggles? Cluetrain argues that the Internet will bring about changes just as earth-shaping as the Reformation.

Cluetrain is based around the concept of markets as conversations. People used to conduct business through conversation, discussing the weather, family and politics before finally bartering their way to a deal. According to Cluetrain, the most important feature of the Internet is that it allows people to have conversations directly with each other.

This was the first book that encouraged businesses to move from “What does my website need to look like?” to “How can we use online technology across our entire business?” It points out that staff at all levels contact each other and customers in ways they never could before. It’s informal and it’s not easily controlled. In fact, attempts to control it will backfire miserably. Businesses need to loosen up and let these conversations happen.

Core principles of Web 2.0

Although this book was written more than seven years ago, many of its descriptions of the ways the Internet could be used are happening only now. Cluetrain aptly described the core principles of Web 2.0 long before Tim O’Reilly ever coined the term; it is all about the power of the individual, the customer, the conversation between employees and between employees and customers.

As Cluetrain states: “There are two conversations going on. One inside the company. One with the market…. These two conversations want to talk to each other. They are speaking the same language…. Smart companies will get out of the way and let the inevitable happen sooner.”

Those market conversations are now starting to take place, largely through the emerging use of wikis.

Social software phenomena such as blogs, podcasts and portals like MySpace are getting a lot of media airplay, but wikis are lower on the radar screen.

These oddly-named software tools (their inventor, programmer Ward Cunningham, named them after ‘wiki-wikis’, the shuttle buses at Honolulu airport – wiki-wiki is Polynesian for ‘quick’), are focused Web sites that are compiled and constantly edited by a designated group of people – all of whom can not only post material to the site but edit it at will.

Corporate wiki use on the rise

You’ve probably heard of Wikipedia, the online collaborative encyclopaedia known as the Big Kahuna of wikis. While Wikipedia, where ordinary Web users keep the world’s largest knowledge base up to date, is a textbook example of a wiki in action, more development these days is happening in the corporate sphere, where companies are using wikis to communicate between departments and, importantly, with customers.

Wikis are more flexible than a content management system because they allow any site user to make changes, not just those with HTML coding experience or the right level of permissions. They are much simpler and less expensive than online collaborative programs such as Lotus Notes (In fact, IBM, the maker of Lotus Notes, uses wikis for many of its project teams). They’re also a good way of cutting down on excess email traffic as people send emails and unwieldy attachments back and forth across corporate networks, creating dangerous version control situations.

Tony Angrignon writes in his Adventure Capitalist blog that “Wikis are on the rise in corporations. And it’s about time. They are lightweight replacements for heavyweight knowledge management systems and are also a way for your user community to generate content that is better, faster, and probably easier to read than you can as a vendor.

“Your users often know your product better than your engineers and product managers because they have to live with it day to day. And guess what? If they tell the truth about some part of your product being broken – that’s a good thing.”

Examples

In late 2004, a handful of technically-minded employees at Nokia began dabbling with wikis as a collaboration tool. Today, Nokia estimates that at least 20% of its 68,000 employees use wiki pages to update schedules and project status, trade ideas, edit files, etc. BusinessWeek reports that where the company once bought outside software to help foster collaboration, now some of the most interesting material is emerging from within the company itself.

A Nokia spokesperson reported that “it was a watershed moment to find a tool that orchestrates a virtual free-flowing jam session of ideas across different groups and units within the company – something that’s crucial for an organization that thrives on out-of-the-box thinking.”

Other major companies that are reported to be using wikis include Sony, IBM, Microsoft, Disney, Intel and eBay. It’s not known which Australian companies are taking advantage of the tool.

Cindy Gordon, a writer for KM World, says, “Few senior executives have used a wiki or are embracing collaboration patterns at the speed required for competitive advantage. Compared with new firms embracing the architecture of participation, that puts them at a disadvantage.”

Connecting with customers

When it comes to using wikis to connect with customers, media properties are well-placed to take advantage of the community-building aspects of the tool. American Express, which owns US titles such as Executive Travel, Food & Wine and the Travel & Leisure franchise has built wiki-based magazine websites where readers can change and add to other readers’ work in a way that is more cohesive than blog-and-comment styles used on most media sites.

Of course, the key to a successful wiki, whether for internal or external use, is giving up control over the content. Ben Elowitz, CEO of Wiki software company Wetpaint, says, “User-generated content is appealing and a little bit terrifying to traditional brand managers. They have to learn how to give up control in order to take advantage of it.”

Cluetrain accurately predicted the double-edged nature of user-generated content and two-way conversations with customers by using wikis, sounding a warning that is even more potent today: “To traditional corporations, networked conversations may appear confused, may sound confusing. But we are organizing faster than they are. We have better tools, more new ideas, no rules to slow us down. We are waking up and linking to each other. We are watching. But we are not waiting.”

Simon van Wyk is founding managing director of HotHouse Interactive. Comment on this story at the HotHouse Blog

Releasing your new initiatives before they’re actually finished could provide you with a significant competitive advantage -as long as you’re doing it for the right reasons, as Simon van Wyk writes

When you talk about the giants of technology and the Internet, Tim O’Reilly isn’t a name that rolls off the tongue. Bill Gates, Steve Jobs, Jeff Bezos from Amazon and Jim Clark from Silicon Graphics and Netscape come to mind before O’Reilly. But he has been a key figure in the industry since before the World Wide Web existed.

If you walk past your company’s IT department, you will no doubt see some of O’Reilly’s work on their desks. His company, O’Reilly Media, is revered by the computer crowd as the publisher of the most practical technical manuals, easily recognised by their use of lithographic drawings of animals on the cover.

O’Reilly has been a strong supporter of the free software and open source movement, which has meant that although he has helped shape technology over the past 20 years, he hasn’t made a fortune from his genius like some of his contemporaries.

Web 2.0

However, the Irish-American has enjoyed an increased profile in the past couple of years since he coined the term Web 2.0 to describe the transformation of the World Wide Web to a user-driven, continually-updated model of development.

O’Reilly defined Web 2.0 as online applications that offer:

In 2006 we literally couldn’t get enough of online video. With fast growing broadband adoption, the proliferation of digital video recording devices and video sharing sites popping up like mushrooms – the real online video revolution finally arrived providing endless entertainment.

Strangely fixating

Since it was posted on YouTube back in April the “Evolution of Dance” video has racked up a staggering 37.7 million views and counting and made its creator, Judson Laipply, a star in the process. It is strangely fixating because whilst its premise is mildly amusing there’s no way you think you’ll sit through the full six minutes, but before you know it you’ve been rapt and have viewed the whole thing.

Curiously entertaining

American Band OK Go’s video for “Here It Goes Again” was viewed by over 1 million people within 6 days of it being posted on YouTube. It’s a low budget production which features the band members in a cleverly choreographed dance routine on treadmills which is curiously entertaining. The film has now been viewed over 9.4 million times.

Eclectic, low budget video content

With this explosion of eclectic and low budget video content it’s particularly interesting to see brands underwriting huge production budgets to create viral videos in an attempt to break through. No doubt attracted by potentially reaching millions of avid consumers without spending millions of media dollars, brands have learned that viral rules are very different from the rules of conventional advertising. Simply putting an existing TV spot up on a video sharing site just doesn’t work. YouTube alone shows about 100 million videos daily which means of course amid the diverse clutter of online video, brands need to find ways to stand out. And this means marketers need to produce highly entertaining videos.

Branded viral video comes of age

Of the most memorable agency-produced viral ads that did the rounds last year, my particular favourites are Smirnoff’s Raw Tea “Tea Partay” and Unilever’s “Dove Evolution”.

The highly entertaining “Tea Partay” proved that people will watch unadulterated advertising and pass it on - as long as it’s entertaining. People expect entertainment value. Don’t deliver and they certainly won’t pass it on.

Created for the web by advertising agency Bartle Bogle Hegarty, “Tea Partay” runs for over two indulgent minutes and features actors as a trio of rich preppy gangsta rappers, rapping about their New England lifestyle and Smirnoff Raw Tea. The video is beautifully produced and serves up something like 50 references to the brand. Who said blatant advertising could never go viral? So far the clip has clocked up over 1.8 million views.

Importantly, the clip has fuelled much discussion in the blogosphere which in turn has helped drive its widespread dispersion.

Playing by the rules of entertainment

I think Kevin Roddy, executive creative director of Bartle Bogle Hegarty sums it up nicely when he says, “I believe if you want to be successful in the world of viral, you need to play by the rules of entertainment, not the rules of selling. A lot of brands might have difficulty with that.”

Of course the production budget of the “Tea Partay” video would have been considerable and more akin to the budget required to produce a quality TV spot. The idea behind “Tea Partay” is a killer, but do brands really need to spend a fortune on production for online video?

For many marketers the idea of underwriting a significant production budget without a guaranteed number of impressions is an extremely hard proposition to swallow and a big influence on not doing viral campaigns.

The beauty of viral videos is they are produced for the web and not for TV. It’s all about the idea and not the production budget. And let’s face it, viral videos work best if they look a little rough around the edges with that consumer generated content feel.

As an aside, whilst I personally love the “Tea Partay” ad, I was a little disappointed to see that Smirnoff failed to sync up other channels (in particular the teapartay.com website) and so when the video first took off, viewers who clicked through to the site found nothing useful related to Raw Tea, and certainly Smirnoff wasted an important opportunity to continue to engage with these consumers and capitalise on the video’s success.

Big traffic spikes

Of course, the Dove Campaign for Real Beauty and its influence on body image has been generating much discussion in the blogosphere and commentary in newspapers, talk shows on television since it was launched.

But the campaign truly went viral in October last year with the launch of “Dove Evolution” and like almost everyone it seems, I’ve been completely mesmerised by it. In 75 seconds, the video shows an ordinary-looking woman being transformed (with the help of lighting, makeup, and photoshopping) into stunning model perfection. Like “Tea Partay” the ad has created a huge impact and generated lots of interest in the blogosphere which in turn fuelled its viral proliferation. According to blog-tracking service Technorati, the video has become one of the most-linked-to videos among bloggers.

The spot was deftly created by Ogilvy & Mather, Toronto and while the number of people viewing the viral “Dove Evolution” video is remarkable - with over 2.3 million views in its first ten days - what’s really impressive is that it has helped generate a huge increase in visitors to Unilever websites.

AdAge reported that the video generated the biggest-ever traffic spike to CampaignForRealBeauty.com which was three times more than the traffic generated from Dove’s Super Bowl ad last year for which Dove paid a whopping US$2.4 million dollars for 30 seconds of commercial time.

Of course the spin-off spoofs, created by mere amateurs have been just as absorbing, and really amusing too. My particular favourite is “Slob Evolution” which has racked up over 278,000 views in its first month on YouTube. The proliferation of the user generated spin-offs also keeps the buzz around the original ad alive and driving traffic to the Dove Real Beauty campaign.

Not bad for a zero media spend.

Like the “Tea Partay” spot, the “Dove Evolution” video runs far longer than a conventional TV ad and demonstrates that keeping the consumer’s attention is simply a matter of how well the content entertains us.

So have advertising agencies really found their groove in this digital world? The success of these two viral videos along with countless others would certainly suggest that agencies are clawing back creative leadership and asserting themselves in the digital space. After all, online video does draw on much of the traditional agency’s core competency. But with Ad Age naming The Consumer as the agency of the year, hot on the heels of Time Magazine honouring web 2.0 and “You” as their “Person of the Year”, it will be interesting to see if brands will be happy to fund huge production budgets on an ongoing basis.

As brand marketers continue to experiment in this space no doubt many will start to invest in amateur but highly creative video creators in the rich new world of consumer generated marketing.

What is clear is that viral marketing has quickly become a potent marketing device and one which has brought about the evolution of a new form of advertising - one that people actually want to watch. No doubt we’ll see a major chunk of marketing budgets shifting to online video.

Simon van Wyk is founding partner of HotHouse Interactive - the company that builds businesses online.

Branded viral video campaigns discussed in this article:

Online marketing will build on recent innovations and continue strong growth in 2007.

A lot of things happened in the online world in 2006 that no one could have predicted - that Google would pay $2 billion for an amateur video network, or that almost 2 million people would take up virtual residence in Second Life.

Of course, that doesn’t stop us from making predictions about the things we think are likely to happen next year. So without further ado, here are my thoughts on online trends to watch out for - and capitalise on – in 2007.

Company websites and branded sites will become cool

This is the trend that corporates the world over have been waiting for – customers flocking to your website to see what you have to say.

In the US, the Proctor & Gamble website is boasting six million unique visitors a month, while Unilever is reaching three million customers a month. That’s a lot bigger than the audiences for many of the magazines and TV shows where they advertise.

How do they do it? Advertising Age reports that “much of the traffic to the big package-goods marketers’ sites appears to be coming the way originally envisioned in the online advertising model: as a response to online display advertising.” Ad-heavy sites such as Yahoo are driving more traffic than search traffic from Google.

In the case of Unilever, a lot of the traffic is being generated by its “Dove Evolution” viral video, which shows an ordinary-looking woman getting the full make-up and Photoshop treatment to turn from frumpy to thin and glamourous. It clocked up more than three million views in the first two months after its launch in October, and helped generate a 34% overall increase in visitors to Unilever websites.

Brands are also driving traffic by participating in the growing community activities available on the Web, such as user-generated videos. Coke has introduced branded video holiday cards in a promotion on YouTube that has been taken up by hundreds of thousands of customers.

A recent Nielsen BuzzMetrics study showed that one-third of creators of consumer-generated media (think YouTube or bloggers), also provide email feedback to companies or brands via their websites, and 13% participate in brand or company blogs - well above the norm for the general population.

There’s money in those online customers. Another study by McKinsey for an unnamed consumer brand showed that while its website reached only 800,000 consumers a year, those consumers were generating $40 in profit on average, compared with $5 for consumers reached by traditional media.

Podcasting will grow, but don’t call it a revolution

The number of Internet users who report that they have downloaded podcasts to listen to something (music, a radio show, a speech, etc.) at a later time has practically doubled over a six-month period this year, according to the Pew Internet & American Life Project. However, it’s still only 12% of Internet users (up from 7% early in 2006), and only 1% of those users tune in regularly to podcasts, according to Forrester Research.

It is estimated that there are more than 60,000 podcasts available for users to sample, which could account for the lack of regular use – maybe there is just too much choice at this point in the evolution of podcasting.

About half of iTunes’ top 100 podcasts are from traditional media companies (see also my prediction about traditional media companies below), indicating that radio has little to fear and much to cheer about podcasting.

The Pew study’s author, Mary Madden, says, “Podcasting is still in its infancy. It is unlikely that it is going to usurp traditional media. It is more likely that it will become one of the many different ways that we get content in an increasingly mobile environment.”

Better TVs will hasten PCs dominance

This one is counterintuitive. Why would improvements in TV picture quality such as LCD screens strengthen the growth of computers? Because LCD screens, which offer better quality, clarity, brightness and movie-screen ratios than plasma screens (as well as an even flatter screen), can easily be plugged into the back of a computer and used as a monitor.

For people who don’t have the room or the inclination to give up tens of square metres of space for a home theatre setup, LCD screens used with computers are a good compromise in these situations, and they are already cheaper than equivalent-sized plasmas.

ClickZ columnist Gary Stein writes, “Consumers will begin to realise they can buy a movie on iTunes, plug their computer into the TV, and watch the movie on TV. From there, it will be a short step to realise that a cheaper, purpose-built computer may be better for the job, and the path to our digital television future is paved.”

In Australia, a University of Sydney study shows that 25% of people already download TV programs twice a week or more (many of them illegally), and downloads are now the main form of TV viewing for more than 20% of respondents. How many of them will be watching on an LCD screen in 2007?

Newspapers will have a revival - online

The Newspaper Association of America (NAA) is predicting that ad spending in newspapers in 2007 will be flat or even negative, pulled down by a decline in classified advertising and no growth in demand from national advertisers.

But while that decline can be laid firmly at the feet of the boom in online advertising, don’t feel too sorry for newspapers, because they are also cashing in on online ad growth. The NAA also predicts spending for ads on newspapers’ website will increase by 22% in 2007, following on from a 34% increase in 2006.

Media research firm Borrell Associates has predicted with within 10 years, ad revenues from many newspaper websites could be as large as the newspapers themselves.

Mobile entertainment content will skyrocket

All this talk about computers - let’s not forget about mobile phones. The increasing use of 3G networks means that the total global mobile entertainment market (including gambling, adult content, mobile games, mobile music, mobile TV and entertainment) will grow from $17.3 billion in 2006 to nearly $50 billion by 2009.

While today music downloads makes up the largest proportion of mobile entertainment content (and 80% of the music content is ringtones), music will be overtaken by mobile gaming, mobile TV and mobile gambling by 2011.

This is one area where the Asia-Pacific is dominant over North America, with 41% of mobile entertainment revenues currently being generated in our region.

Virtual worlds will become immersive marketing platforms

There is an enormous difference between the first generation of brand placement in computer games and what is now possible with 3D worlds like Second Life. Executed properly, this is a very clever way of infusing brands into online life.

More and more companies will launch extensions of their businesses in virtual worlds which will be used as super-charged, technology advanced marketing and communication tools.

And to some extent many of the virtual products and services developed for consumption in online worlds will become blueprints for new products and services in the real world.

There is one common theme through these predictions - in 2007 the magic will continue online. Good content drives traffic and effective branding. Cleverness and creativity is more important to marketers than ever before - not in terms of advertising messages, but giving consumers what they want so they will visit you online. Companies that understand this will prosper in 2007.

Simon van Wyk takes a look into the frenzy of excitement around the rich virtual world of Second Life and what it holds for brand marketers.

BusinessWeek put Second Life onto its front cover in May this year accompanied with the provocative headline “Virtual World, Real Money”. Since then the 3D virtual world has never been far away from the media spotlight.

Now home to close to 1.9 million super savvy, switched on individuals, media coverage has intensified lately for two major reasons. Firstly, there’s an increasing number of brands moving into the space and secondly the link between the thriving, if fledgling, virtual economy and real world US dollars is suddenly enticingly apparent.

It seems that so far most of the money being made in Second Life is a result of virtual land speculation. Just last month, a Second Life property tycoon Anshe Chung, known in our world as Ailin Graef, announced that she had amassed virtual assets worth over $US1 million purely by buying and selling land within Second Life.

But it’s just a game - isn’t it?

Not exactly. The 3D world is attracting savvy digital natives from around the globe and with them opening up major new branding opportunities for switched on brands. Second Life is a virtual world that anyone with a broadband Internet connection can be belong to. In Second Life you create a virtual identity or avatar and live out an imaginary life. In this virtual world using the software’s tools you can hang out, meet people, visit music and film festivals, buy things, build things, create things and sell them all for Linden dollars - the game’s currency. At virtual currency exchanges you can convert your stash of Linden dollars into cold, hard US dollars.

As the site says: “From the moment you enter the World you’ll discover a vast digital continent, teeming with people, entertainment, experiences and opportunity. Once you’ve explored a bit, perhaps you’ll find a perfect parcel of land to build your house or business.”

A thriving economy

Most Second Life residents just hang out there for free. But there is a growing interest in buying land in the virtual world. Happily though, we’re not talking about Sydney real estate values with a typical parcel of land selling for the equivalent of US$15. Businesses on the other hand are splurging on private islands and building stunning architectural masterpieces for their Second Life headquarters or reinventing the retail experience with ambitious landmark designs for their flagship stores.

Of course, it’s not just land that you can buy. Second Life residents can purchase a growing array of products and services from apparel and footwear, cars and hotel accommodation.

For brands that are finding it increasingly difficult to get traction with other forms of media, Second Life offers a halcyon environment - a truly social world where consumers can immerse themselves in the brand. No doubt helping to strengthen the brand appeal in the real world.

The connections across Second Life run deep

The first thing most new residents do is to join a group - depending upon their interests and virtual lifestyle needs. Marketers can tap into this connectivity by creating groups to which interested residents can join and in that way enabling the brand to exercise precision marketing campaigns and enjoy the connectivity inherent within the targeted groups.

So it’s no surprise that for some time now companies have been opening virtual extensions of their businesses in Second Life and using the virtual world as super-charged, technology advanced marketing and communication tools.

From opening up virtual stores or offices, to conducting market research and testing virtual products, Second Life is quickly becoming an effective marketing platform and realising a number of communication objectives, both internally and externally.

For instance, a presence on Second Life could be used to establish employee collaboration and networking opportunities. Or consider the test marketing and research potential. There’s also the opportunity for real world event tie-ins and promotion. Indeed the clothing retailer, American Apparel, proudly boasts a fabulous retail environment in the virtual world and offers a 15% discount to Second Lifers who visit online and later shop in a real world store.

The key aspect of getting into Second Life is to develop the brand within the virtual world and translate products into virtual ones.

A taste of the trend setters

Teleporting is the preferred means of transport in Second Life allowing residents to fly off anywhere in the Second Life universe at a whim. So whilst cars are totally unnecessary, it’s interesting to see that car manufacturers are creating a strong presence in the virtual world in the hope of making a strong impression in the real world.

For instance, Toyota opened a dealership in Second Life in its own neighbourhood called Scion City. Here it sells three models of its Scion which are all fully customisable. The virtual vehicle costs about 300 Lindens - or about US$1.00.

Meanwhile Nissan provides its Sentra to Second Life residents free of charge. Residents pick up their cars from a gigantic vending machine the size of an office building and then take their Sentra for a spin on the Nissan Island test track.

And GM has a Pontiac dealership which sells the Solstice GXP. Like the Toyota Scion, it’s fully customisable and comes in absolutely any colour you want. GM has also created Motorati Island where it is giving away land grants to residents who are interested in spending time in car related projects.

The new retail experience

American Apparel was the first clothing brand to set up shop in Second Life. With its imposingly sleek store, it’s a very cool environment to check out their label. Adidas and Reebok both boast flagship stores on private islands. In the Adidas store, customers can test the bounciness of their Adidas sneakers on a special trampoline, while Reebok extends its real world marketing by only selling white shoes and allowing customers to customise and colour their shoes to their particular tastes.

Serious money

ABN AMRO, the Netherlands’ biggest bank has opened a branch in Second Life that offers financial advice and is set to create a virtual bank that resembles ABN’s real-life branches.

Serious entertainment

SONY BMG Music Entertainment has created a feature-packed space on The Electric Sheep Company’s Media Island. Their space contains fan zones for leading SONY BMG artists with video and audio content. The company plans to experiment with selling music within Second Life directly to residents.

Meantime, Sun Microsystems has created the Sun Pavilion as a better way to reach out to developers and customers than conference calls or webinars.

Whilst Starwood Hotels owner of Westin, Sheraton, and W chains is testing out a new loft-style hotel in Second Life called aloft. The virtual world provides a test market for the hotel’s design and a means to prototype the evolving design.

And respected news service Reuters has opened up a news bureau inside the virtual world and, very smartly, has employed a virtual reporter to cover it full time.

The test market

It’s easy to see why companies are flocking to Second Life. Residents in Second Life are giving companies first hand insights into what they would like to do by enjoying experiences that aren’t quite possible in our world.

And whilst traditional media is losing its appeal, having a presence on Second Life certainly suggests being in touch with the latest trends and an understanding of where the market is headed.

Although the number of residents at 1.8 million and counting is not vast, these residents are pure gold - technologically savvy early adopters - key influencers that are vital to brand building.

Of course the brands spending real marketing dollars to create a presence in the virtual world will need to establish clear measures of success. At this stage, it would be fanciful to expect to generate revenue from such a presence, but the benefits of providing immersive branding experiences will undoubtedly flow through to real world perceptions.

Clearly, for a company considering jumping into Second Life now, serious homework is needed. But Second Life gives consumers an opportunity to engage with a brand on so many levels. And what I think is becoming apparent is that companies will all need to have virtual world extensions of their real world businesses in order to gain a foothold into new products and services development.

Simon van Wyk explores what lies ahead for the YouTube generation.

What lies ahead for the YouTube generation? As the digital revolution takes hold, entertainment will be increasingly polarised between high quality, expensive blockbuster events and plentiful, free amusements that will be worth what you’ve paid for them.

Predicting the future can be a risky exercise. It’s all too easy to end up with egg on your face when reality unfolds over time. I remember as a child the Jetsons-like predictions that by the beginning of the 21st century we’d all be flying around in personal flying cars and wearing shiny one-piece outfits. Instead, we’re still travelling in our cars (albeit in a lot more comfort) underground in expensive road tunnels rather than in the air, while our kids wear fashion better suited to a 19th century gothic novel than a science fiction tale.

When it comes to speculating about how we will entertain ourselves in 20 years, I think it’s useful to look at where we are along a continuum; by looking at how things have changed in the past 20 years we might get some idea of what to expect in the next twenty.

Twenty years ago the world was still assessing the overwhelming effect of television on all forms of entertainment. Attendance and revenue for live events from cinema to theatre to sporting fixtures were all in freefall because it was more convenient and cheaper to watch it all on TV. MTV was starting to affect radio playlists and record sales, as video became an essential part of a song’s appeal.

The World Wide Web, meanwhile, was just a gleam in scientist Tim Berners-Lee’s eye two decades ago. No one was predicting the digital revolution that would sweep through the entertainment industry and which is now overtaking the seemingly unbeatable impact of television itself.

When you think about it, although the Jetsons scenario has not come to pass, we’ve gone through a hell of a revolution in entertainment in the past 20 years. The influence of the World Wide Web and its developments over the past decade, from ordering tickets online to sharing songs through Napster to building social networks and sharing videos on MySpace and YouTube, is changing almost every aspect of entertainment and is in the process of usurping the seemingly impregnable position of television. And it’s not over yet: digital progress will mark the biggest changes to come in entertainment, arts and sports in the next 20 years.

The revolution will not be televised

One of my favourite phrases is, “The revolution will not be televised”. Although it was not coined with the Internet in mind (it was the title of a song by black activist and singer Gil Scott-Heron back in 1971 about the American Black Power movement), it has become a mantra for me in my work in the online media. It doesn’t mean that digital is going to kill television, but it does mean that television is no longer in the driver’s seat. Narrowcasting, not broadcasting, will be the dominant paradigm in entertainment over the next 20 years.

Digital doesn’t just mean the Internet

Digital technology will become the norm within the traditional entertainment media as well as the new media. Movie theatres are already moving to digital – all major movie chains are expected to convert to digital film by the end of the decade. Films will be available on small cassettes rather than huge canisters of film, and every film shown in cinemas will be an “answer print” – only one generation removed from the original (mass release films are currently second generation prints). There will be no problems with wear and tear and no “spatial jitter” as the film moves through the projector.

Digital movies are expected to save the studios more than a billion dollars a year in distribution costs. They will also make it considerably cheaper to show the same movie on multiple screens at the same cineplex. This will further reinforce the current blockbuster mentality – think 25 sessions per day for Pirates of the Caribbean at your local Greater Union, but little else.

That’s not to say that more blockbusters are a bad thing. The incredible special effects in movies such as Superman Returns (such as the buckling metal in the passenger jet as Superman saves it from crashing) are arguably worth the money being spent to achieve them, as long as there is quality storytelling and not just special effects. Blockbusters will continue to become more high-tech and more realistic over the next two decades, making it difficult for low-budget films to compete.

Arthouse cinema will become the long tail

While logic would dictate that this would spell the death of arthouse cinema, I think it will give it a new lease on life. Arthouse cinema will become the “long tail” of movies (more about the long tail a bit further on). As the Internet increases the profile of niche products, arthouse cinema will thrive as it caters to those niche players who still want a group experience. If you like arcane French cinema and you have to look for it now, in the future you won’t have to look so far. Movies pushed out of cineplexes by bigger blockbusters will move to the independents. Cinema will become both deeper and shallower at the same time.

Back at the cineplex, digital technology will be used to extend “live” experiences beyond the stadium and opera house. In the US, a company called National Cinemedia is piping rock concerts from major arenas into cinemas in towns that major bands would never visit. You can’t smoke dope or dive in the mosh pit, but at $15 it’s a hell of a lot cheaper than a concert ticket. At the other end of the culture scale, the New York Metropolitan Opera has begun transmitting live performances to movie theatres and broadcasting more than 100 live performances over the Internet or on digital radio in an attempt to expand its audience.

The blockbuster mentality has affected theatre as much as it has the movie business in the past 20 years – though Andrew Lloyd Webber is as much to blame as television. This trend is likely to continue, as the cost of putting on a show becomes even higher relative to other forms of entertainment. People will only spend $100 on a ticket if they know they are going to see a proven winner like Les Miserables or The Lion King. Families have limited budgets, so it will be harder and harder to justify going to live theatre. Although local amateur theatre will continue, non-blockbuster shows by metropolitan theatre companies will have to change the way they work. They will turn to the Internet to keep their production costs low and to expose themselves to a wider audience. YouTube will become the new Broadway, hundreds of times over. Of course, the easier it is for theatre companies to build a profile online, the easier it is for bad theatre companies to build a profile. The theatre will become both deeper and shallower.

Spyware never sounded so good

If you thought Napster and iTunes represent the pinnacle of personalised music, just wait until you see what will happen online over the next 20 years. By aggregating music choices of millions of users, new online music services will take you beyond what you know you like and move into predicting what you will like. Pandora Radio, one of the first applications in this area, allows you to set up your own radio station, where you tell the program what type of music you enjoy and it selects a menu of songs that include not only the artists you have selected, but music of a similar genre and sound. Another site, last.fm, scans your computer or iPod and makes song choices for you based not only on what you have downloaded but, more importantly, which ones you actually listen to. It then uses an algorithm to create a playlist that mixes your collection with other songs it predicts you will enjoy. And all of this is free as long as you are prepared to listen to some ads amongst the music. As Wired says, “Spyware never sounded so good”.

The stranglehold that record companies and radio stations have had over new music was shaken first by Napster and Kazaa and then by iTunes. Artists like indierocker Beck are taking the next steps in the disintermediation between artists and their fans, providing a model of the disparate nature that music releases will take in the future. His most recent album, Guero, was released in several forms – first as a work in progress leaked onto the Internet, then as a studio CD, followed by a DVD with seven extra songs and professional music videos, and an album of remixes. He even produced homemade music videos filmed by his family members and loaded them onto YouTube. This multimedia approach to music will become more pronounced in the next 20 years.

Unlike television or even other Web sites, YouTube makes it easy for bands and fans to establish a dialogue through video. It’s easy to email video links to friends, or paste links onto individuals’ websites, blogs, or MySpace pages. Posting tribute videos and comments is also easy. The lead singer of OK Go, a band that has built its eclectic reputation through clever videos on YouTube, told Wired, “It sort of provides an infinite information jungle gym for our fans, one that’s always growing and morphing,” constructed as much by the fans as by the band itself.

Virtual concerts

Another way bands will use the Internet to connect with fans in the future is through virtual concerts. Singer-songwriter Suzanne Vega or rather, her computer-generated avatar - recently performed a virtual concert on the SecondLife website, where users create alter egos and interact with each other in an alternate society. Visitors to the site could hear her live performance and watch a rather clumsy digitally created representation of the event; Vega’s avatar struggled to hang onto her virtual guitar and her mouth was rarely in synch with the music. One reporter who attended the concert said, “all this is pretty goofy. But it’s likely the birth pains of a new age of music performance.”

And although the rise of iTunes is threatening to kill album sales in favour of singles, services such as TuneBooks will ensure the album concept won’t die. Customers download TuneBooks along with an album online and then navigate a QuickTime-powered trip through pictures, videos, credits, and lyrics. It will soon be available in a mobile phone version, and will no doubt lead to more eclectic ringtones, ones that will hopefully sell more than the Crazy Frog (speaking of the shallow end of the music pool).

One feature of the digital revolution that is having a strong commercial effect across the entertainment industry is the concept of “the long tail”. Coined by Chris Anderson, the editor of Wired magazine, the long tail refers to the fact that back catalogues for just about anything are able to be sold cheaply via digital means, so old and obscure titles are enjoying a renaissance. While bookstores make 95% of their income from a maximum of 100,000 titles, Amazon.com’s 3.7 million titles are all equally available, and half of its income comes from books outside the top 100,000.

Anderson cites the example of Into Thin Air, a recent book about a mountain-climbing accident that, through Amazon’s “also recommended” engine, breathed new life into a 15-year-old title on the same topic, Touching the Void. Sales of the older book ended up overtaking the newer one, and it was made into an award-winning docudrama that drove further sales for the original book. This story is being retold over and over across videos, DVDs, music and all forms of archived entertainment.

More reality TV

What about TV - how will it address the digital challenge of the next 20 years? The current teething pains around digital broadcasting will be settled over time and interactivity will become a much more important part of the TV viewing experience. That means more reality TV, a concept that is driven more by the opportunity to participate in decision-making than the promise that Australian Idol will find the next Elvis or Big Brother will uncover the next game show host.

The relative cost of producing quality drama and sports programming for TV will continue to go up as audiences go down. A couple of things will happen as a result. Name actors and sportspeople may not be able to command the same salaries as they do at present. Many new shows will be available only via services such as YouTube, filmed using low-cost equipment to suit the less polished nature of online video. Of course, the problem with everything ending up on YouTube is that our tolerance for low production values will grow. We’re already getting used to pixellated photos and mobile phone photos – even on the news. We will become pickier and less picky at the same time as we make the time to watch some quality drama on TV, but also consume (usually in bite-sized chunks) the fast food options available online.

As bandwidth becomes less of an issue, video will be added to more online services, making them more like (badly done) television. In the SecondLife vein, a research group at Northwestern University has developed a text-to-speech engine called Buzz that identifies most-searched topics on popular blogs and uses a virtual host to read the information out loud. The next step will no doubt be David Tench summarising and commenting on the web’s top blogs.

Gaming is also going down this route, with games that allow you to put your own face on your on-screen counterpart. Games will also use applications like VirtuSphere, which was designed for military training and lets users roam around simulated environments without being limited by physical barriers. A wireless headset senses the movements of virtual explorers, letting them navigate lifelike situations inside the freely rotating orb. Its makers claim you can run, jump, or crawl your way through anything that happens on-screen without hurting yourself on any actual obstacles.

One guarantee

One guarantee for 20 years’ time is that we will have a much wider range of choice in entertainment. The great unknown is what will be worth choosing.

The explosion of social networking online has marketers around the world terrified about the loss of control over brand messages. Simon van Wyk looks at how some of them are coping.

User-generated content sites dominate the top 10 fastest growing Web brands, according to the latest statistics from Nielsen/NetRatings. MySpace, whose brand has grown 183% in 12 months, was the fastest growing site on the list in terms of users, moving from 16.2 million unique visitors in July 2005 to 46.0 million in July 2006 – ahead of Internet giants Google and eBay, respectively.

Other user-generated sites making it into the top 10 were ImageShack (an image-hosting site), Heavy.com (a video-sharing site), Flickr (a photo-sharing site) and Wikipedia (the user-developed encyclopaedia).

The rise and rise of MySpace

MySpace continues to be the user-generated, social networking website on everyone’s lips. Ever since it hit the mainstream radar last year when News Ltd plonked down US$480 million for the site, it has created an increasing amount of hype – and followed it up with traffic growth and revenue deals to match.

Not surprisingly given its growth in user numbers, MySpace has overtaken Yahoo’s email login page as the most visited web destination in the US, accounting for 4.5% of all Internet visits in July.

The money has followed the traffic. Google paid US$900 million in August for exclusive rights to provide search and keyword advertising on the teen-dominated site over the next several years. Online marketing researchers eMarketer estimates that MySpace will generate US$180 million in advertising revenue this year, 65% of the total revenue in the social networking category.

eMarketer also estimates that ad revenue from social network sites will rise to nearly US$1.9 billion in 2010 in the US alone, up from US$280 million in 2006. With the Google/MySpace deal, ad revenues at MySpace may top US$1 billion as soon as 2010. Worldwide social network ad spending is expected to rise to US$2.5 billion in 2010, from US$350 million in 2006.

Future Exploration Network chair Ross Dawson told the Australian Financial Review recently that “With the purchase of MySpace, (News Ltd chair) Rupert Murdoch understood that this demographic is not reading magazines. Teen magazines are dropping off because they are too slow. MySpace is the way to access this demographic.”

AFR also reported that since the News Ltd purchase, advertising content on MySpace has risen noticeably, but, “even so, it remains the online hangout of choice.”

Not surprisingly, MySpace’s success has spawned some sizable mainstream competitors, such as Windows Live Spaces from the Microsoft Network. An Australian-flavoured version of Live Spaces has been promised by Nine chief executive Eddie McGuire and new ninemsn chief Tony Faure, offering video search capabilities, user-generated content and TV episode downloads.

Meanwhile, the early adopter market has decided a Murdoch-owned MySpace is no longer cool and has moved on to sites such as Second Life, a virtual reality community where people build their own 3D avatars and live virtual lives in virtual beach houses, earning and spending virtual money.

Does that mean MySpace has already peaked? While the early adopters may be moving on, the main bulk of the online population is just becoming interested in social networking. There is also an enormous amount of growth to come in the availability of broadband, which will benefit sites like MySpace and the video-sharing site YouTube.

Not just the young ones

Interestingly, although video sharing is widely seen as a youth phenomenon, recent data from Nielsen/NetRatings show that YouTube is attracting significant numbers of Internet users, particularly those more than 35 years old. 60% of audience believed to be 35 and older.

Technology research firm In-Stat has reported that the potential market for online video content worldwide will grow from 13 million households in 2005 to 131 million households in 2010. In-Stat predicts that by 2010 there will be 413 million broadband households worldwide, up from 194 million in 2005.

The opportunity for marketers

In a recent Australian webcast about the revolution in user-generated media, Media Zoo managing director Tom Kennedy called user-generated sites “the publishing model of our generation”. However, as Viocorp managing director Ian Gardner pointed out during the same webcast, the problem with user-generated sites was that they have no revenue model.

The bigger problem, from a marketing perspective, is how to work with these new media in order to help them develop a revenue model in the future. Unlike traditional media, marketers have very little control over where and to whom their message is delivered on social networking sites.

Connect and build

Steve Rubel wrote recently in Advertising Age: “The conversation is global, and marketers worldwide are terrified of losing control. Consumers are tearing down the wall that separates two diametrically opposed forms of marketing: control and collaboration. Savvy marketers know they must move from a command structure to one where they connect and build value together with consumers.”

A few companies are harnessing the possibilities of user-generated media. Coke has developed the “Coke Side of Life” site, where the company entices users to take a series of monthly challenges and create and upload videos about those challenges. The first challenge on the site, “The Essence of You”, asks, “If you could bottle the essence of you and share it with the world, what story would you tell?” None of the videos uploaded so far would win awards, but it’s a great way of engaging the social networking generation.

Surprisingly, a handful of financial services companies are already embracing the notion of connecting and building within their marketing communication strategies. HSBC has been quick to see the potential of employing the tenets of social networking with regard to their core brand values. They launched their site yourpointofview late last year.

The website is part of the brand’s global conversation aimed at highlighting HSBC’s global understanding and local relevance. The site invites people to share their opinions on a wide range of issues affecting the world and compare views with the rest of the world.

Along these lines, Vancity, Canada’s largest credit union has launched a social networking site which invites the community to “change everything”. The site changeeverything.ca, is built around community activism and encourages users to create a list of the changes they want to make, blog about the progress, link into advice and join a conversation about the changes that are being made by friends and the community.

Meanwhile, MSN in the US has taken the concept of reality television online and is letting users make decisions in a real-life situation. Fan Club: Reality Baseball asks “viewers” (their term – still thinking in traditional media terms) to vote on management decisions for a real professional baseball team, the Schaumberg Flyers, a minor-league team in Illinois.

All those armchair experts vote on which players play, what positions they play, and the batting order. Mind you, when I checked out the site, the Flyers were in the middle of a nine-game losing streak, so the team’s manager doesn’t look like he will be out of a job any time soon.

The key for marketers trying to leverage user-generated media is to use their creative talents to create activities that stand out from the amateur-created crowd. As Tom Kennedy said in the above-mentioned webcast: “You can’t replace quality. A well-executed idea is irreplaceable.”

Simon van Wyk is founding partner of strategic online solutions company HotHouse Interactive.

The sites

If you would like to check out some of the websites mentioned in this article:

It’s well known that marketers are shifting their advertising dollars away from traditional media, and using hip new ways, borne from the latest web 2.0 concepts and technologies, to connect and engage with consumers online. We’re already starting to view a brand experience online in much the same way as we would view its 30 second TV spots of old.

Of course going online in today’s world means using any number of devices from the more conventional laptop and personal computer to souped up mobile devices and the latest mobile phones.

Sales of mobile phones dwarf sales of PCs

Indeed sales of mobile phones the world over dwarf sales of PCs. It’s difficult to put a hard number on it, but there is something like 1.5 billion mobile phones in the world today. And many of these are equipped with web browsers, cameras to take photos and video, along with email capabilities.

“Everyone is going to have a cellphone”

Internet access is already a ubiquitous feature on mobile phones and research recently published by US-based mobile audience measurement company, Telephia, reported that more than 34.6 million mobile subscribers accessed the Internet via their wireless devices in June this year. The findings also showed that email, weather and sports sites were the most frequented mobile Internet categories.

However, far from ideal usability and speed of access have, so far, made the proposition a second rate alternative to more conventional channels. Most websites simply are not ready to receive mobile visitors. Beautifully rendered, and highly usable websites can turn into a complete mess when viewed on phones or other mobile devices.

While the proliferation of sophisticated mobile devices is widespread and Japan leads the world in mobile web usage, Forrester Research’s “The State Of The North American Mobile Web” reports that just 4% of US households are using the mobile web. And that only 10% of mobile web users say that they actually prefer to use their mobile phones to access the Internet.

The mobile web has thus far failed to attract critical mass, primarily because:

• Mobile sites are difficult to find

  Mobile service providers provide direct links to a limited number of sites. Manually entering URLs with no guarantee that they work on the mobile platform is not an optimum user experience.

• Content

  Sites need to focus on providing just key information, minimising content and load times.

• Poor usability

  Pages need to be properly formatted and navigation needs to be simplified and designed for the small screen.

Mobile Internet Strategy

However, while many brands which just a few years ago would not have contemplated mobile as a channel, are now clearly considering the need for a mobile internet strategy. Repurposing existing web content that has been designed to be accessed from a PC clearly won’t hit the mark.

However, there are strong signs that brands are starting to take the mobile web seriously. Thousands of companies are flocking to and signing up for the new dotmobi domain name which introduces a new set of accessibility standards ensuring that services and websites under the dotmobi domain are optimised for use on mobile devices.

Now many of these brands already have thinner versions of their websites designed for mobile users, but in the face of unremarkable uptake and usage, the thinking is that a clearly defined standard domain name may well just give the channel the breakthrough it needs, sparking more interest in the mobile web and helping to drive traffic.

Taking the Mobile Web Seriously

Meanwhile, Motorola and Yahoo! recently announced an agreement to pre-load Yahoo! Go for Mobile on tens of millions of new Motorola mobile devices giving consumers an optimised experience with quick and easy access to their own favourite Internet sites, web content and services on their mobile phone (as well as their personal computer).

Google has also demonstrated the company’s commitment to making the mobile phone a more convenient way to access information on the go.

The latest version of Google Maps for mobile features live traffic updates and the ability to save favourite locations and driving directions. Mobile phone users will now also be able to customise the content that appears on the mobile version of their Google Personalised Homepage.

Back home, “The Australian Mobile Phone Lifestyle Index” is a collaborative industry research project carried out by AIMIA, m.Net Corporation and Ideal Interfaces and provides insight into the profile, behaviour and preferences of Australian mobile phone users. The latest report published in May reveals that 59% of those surveyed had used their mobile phones to access information such as news, weather and movies in the past twelve months.

And when asked what sort of information they would like in the future, respondents said maps and directions (35%), weather (34%) and news content (32%).

Anywhere your customer goes, their mobile goes too

Whilst these particular responses are hardly earth-shattering, there is certainly much room for exploration, and it will be crucial for companies to give their customers multiple, seamless access points both from a conventional connection and from the mobile platform.

Of course, working out how and when your customers would benefit from accessing the mobile web and developing content accordingly presents a significant opportunity. For instance, cities with large numbers of public transport commuters provide potentially eager and willing consumers of mobile content. Develop content that they want, make it easy to access, and there’s your captive audience.

Smart marketers are starting to take control of the mobile platform

Certainly content development in this arena is starting to hot up. And it won’t be long until the mobile web is a far more intuitive experience and we’re all using our mobiles for many of the activities that we currently associate with the PC.

HotHouse Interactive has appointed leading business strategist, Lee Hill, to the role of chief executive officer.

With a background in both high profile consumer goods and business-to-business services companies both here in Australia and overseas, Lee’s expertise is in translating business realities and market insights into clear business models with high performance outcomes.

Well known in the marketing industry for his work with Lion Nathan which spans over a decade and includes launching XXXX Gold in Queensland which is now the State’s top selling beer and turning around the Tooheys portfolio into the high performing brand that it is today. His career also includes end-to-end business process re-engineering at PMP’s Pacific Micromarketing.

His business expertise and marketing breadth and depth are a perfect fit for HotHouse which has gained a solid reputation for industry leadership. In his role at HotHouse, Lee will spearhead the company’s business strategy and apply his skills to managing the company’s growth and development, ensuring the company is ideally placed to deliver exceptional consumer experiences using a balance of creativity and technology.

Commenting on his appointment, Lee Hill said: “With the transition of the web from a publishing platform to a fully interactive branding medium HotHouse is at a critical point in its evolution. My job is to make sure we fully leverage our formidable skills and make a profound difference to the marketing landscape in Australia.”

Lee’s appointment to the CEO role means that Simon van Wyk, HotHouse founder, can now fully focus his talents on emerging media channels. This will include helping HotHouse clients which include two of Australia’s biggest marketers - Toyota and News Ltd. - fully explore and embrace emerging media channels to drive consumer engagement and build their businesses online.