Tablets, contextual ads drive discussion at summit

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The marketing and media potential of tablet computers was front and center during the 2011 Media Summit New York, held last week in Manhattan. In his opening keynote, David Carey, president of Hearst Magazines, said a quarter of his division's subscriber base will be tablet users in the foreseeable future. Carey said Hearst will end this year with “several hundred thousand subscriptions in total” sold through digital publisher Zinio, Barnes & Noble's Nook e-reader and Apple's iPad. Digital subscriptions through these channels, he said, are “taking all the friction not only out of the initial sign-up but also out of the renewal. We don't have to carpet-bomb you with direct mail; and so, that becomes a much more efficient business for us.” Carey came to Hearst last June from Condé Nast, where he oversaw Golf Digest, Golf World and Wired. Hearst's magazine division publishes Cosmopolitan, Esquire and Good Housekeeping, among many titles, and the company is gearing up for the acquisition, announced in January, of more than 100 magazines from French publisher Lagardère. In addition to expanding its international presence, Hearst “is focused on building strong revenue business around tablets,” in particular by expanding into Internet retailing directly within the tablet experience, Carey said. An example, he said, is digital magazine, which offers features on high-fashion clothing, along with the ability to order items by clicking directly on the articles and illustrations about those products. “Content companies are going to move into commerce,” Carey said. “If you see one of the great rooms that is presented in House Beautiful, imagine, as a service to the reader, [that] they don't have to hunt all over to buy the lamp, buy the rug; that they can basically buy it right from the page.” Carey said Hearst plans to introduce a series of e-commerce partnerships this year. Also prominent on the Media Summit agenda was how the rise of contextual ad technology is providing ever-closer alignment between readers' Internet interests and the ads served to them. “Contextual ads have been around for years with print ads placed across from relevant content,” said Doug Stevenson, CEO of contextual and in-text ad company Vibrant Media. “Now, with the benefit of technology, we can do amazing levels of contextual targeting. Now the carrier for advertising can be a single word. We can deliver, say, a video commercial off that single brand word within an article.” Jon Kraft, COO of Twitter-client company UberMedia, said contextual advertising, already delivering impressive returns, can be boosted significantly if the marketer has additional information. “We've done primary research on the impact of this kind of targeting and, for every piece of data about a potential customer, we get two times the performance,” Kraft said. “So, if you know his age, you get two times ROI; and if you know both age and gender you'll get four times the return, and so on.”
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