Advertising via print media, especially mail, has been falling. This talk describes a new kind of interactive stamp that rewards people for sharing their preferences. It bridges any kind of printed medium and mobile, and enables one click purchases. The result could help print ads compete with search ads, social ads, and mobile ads.
2. 1st Class + Std Mail ~ 70% Rev, 90% Vol
$4.8B loss in 2012 ($15.9 including mandatory health and retirement)
Source: USPS Financial Report 2012 Form 10-K
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You’ve just paid $15 to see Ironman
when you’re presented with…
Unsolicited car ad Unsolicited preview
Which ad makes you happy?
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Consequences of ads that don’t make people happy.
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Digital Ad Revenue Crosses $10B
Source: Internet Advertising Report 2013
Puzzle: mail ads are declining but digital ads are rising?
9.
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User Advertiser
Google Platform
1. Users declare interests
2. Advertisers buy
attention
3. Google refines its
matching algorithm
Platform
User Advertiser
Wash…
Rinse…
Repeat…
Preferences +
Interactivity +
Feedback
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We Need…
… to let recipients
express their
preferences… … interactivity…
… feedback to drive
improvement…
… to route flows of
mail, of data, of
money…… partnerships with
industry …
… a business
model.
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ALL BUILT AROUND PAPER?
… doing all this…
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Win for Recipients
• Gets Voice!
• Archival, on-demand
retrieval of ad content and
coupons
• Green, less landfill
• Get buy-it-now option
• Bi-directional: Can request
info, declare intent to
purchase home furnishing,
schedule oil change, try
new restaurant
• Get Paid!
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Win for Mailers
• Learn what they like and
what they don’t
• Like permission based ads,
much higher response rate
• Can reward for forwarding
ads to friends and family
• Notification of delivery,
opening, interest in
product, interest in seller
• Physical mail becomes
portal to mobile access
• Can motivate behavior, not
just clamor for attention
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Win for USPS
• Avoids Do-Not-Mail
• Can charge more for unwanted
mail
• “Move Updates” at the press
of a button
• New source of revenue from
escrowed funds
• Closes data feedback loop
enabling value proposition
relative to Google and
Facebook
• Enables electronic commerce
• Data layer creates platform for
ecosystem of biz partners
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Platforms get enormous value from 3rd
party developers
Most firms can only
concentrate on most valuable
apps
Profits increase when others
add to platform’s “Long Tail”
USPS can have its version of MS Word / PowerPoint / Excel
and let business do everything else.
These are
ecosystem partners
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Challenges
• What about elderly access?
– DMA: Trend is extremely favorable
– Works for any device with web access & camera
– Can pre-load app & starter account on mobile devices
• How handle rollout?
– Use public records: driver’s license, voting, phone records, even
direct mail lists
– Advertising pays for rollout and even motivates adoption
– Solves problem of hybrid mail
• What happens to unclaimed coupons?
– Simply expire and can be reused
• What happens when people claim coupons but never buy?
– Advertisers will figure this out fast!
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Opportunities
Total Ad Market $167B Total E-Commerce Market $225
Television
Desktop Internet
Mobile Internet
Newspapers
Magazines
Outdoor
Radio
Cinema
135%
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Australia Austria Belgium Canada Cypress Denmark
Portugal Spain Sweden Switzerland UK USA
Opportunities
Finland France Germany Greece Hungary Iceland
Ireland Italy Luxemburg New Zealand Netherlands Norway
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Australia Austria Belgium Canada Cypress Denmark
Portugal Spain Sweden Switzerland UK USA
Opportunities
Finland France Germany Greece Hungary Iceland
Ireland Italy Luxemburg New Zealand Netherlands Norway
28. Twitter: @InfoEcon 28 PlatformEconomics.org
Redeemable Information Coupons
… let recipients
express their
preferences… … provide
interactivity…
… feedback to drive
improvement…
… route flows of
mail, of data, of
money…… partnerships with
industry …
… a business
model.
29. Twitter: @InfoEcon 29 PlatformEconomics.org
For more on Redeemable Information
Coupons
• How to Strengthen Ad Mail by
Building a Digital Information
Market. (Van
Alstyne, Parker, Tushar) OIG RARC
report 14-002 Dec 11, 2013
http://ssrn.com/abstract=2377476
• An Economic Response to
Unsolicited Communication
(Loder, Van Alstyne Wash)
Advances in Economic Analysis &
Policy 6(1) (2006)
http://ssrn.com/abstract=1762212
Strengthening Advertising Mail
by Building a Digital
Information Market
December 11, 2013
Report Number: RARC-WP-14-002
WHITE PAPER
Nearly 100% of US broadcasters are working with Gracenote to do interactive TV overlays with polling and add replacement.
Hold out a piece of mail
Gandma story of collecting couponsThere are people who will spend money to save time (CEOs) and those who will spend time to save money (grandmas). This works for both. The first would do it for free, and just need a voice.
Armenian Taxi driver story: brother owns hardware store. We sent out 5000 piece didn’t hear anything back. Could your system tell me if they got it?
Only need to recover 2.9% of ad market to make up $4.8 B deficit.