Apple TV and the end of 1to1 marketing


The most interesting thing missing from Apple’s presentation yesterday wasn’t a new iPhone. It was 1to1 marketing.

Steve Jobs spent much of his keynote at the Macworld conference trying to turn Apple TV from a toy into a serious attempt to control America’s living rooms. U.S. consumers spend billions each year on home movie rentals, video and music, and yet no one has figured out how to own the entertainment market. Apple TV now makes it easy to get video-via-internet, but there are still too many pipes leading to the den. Netflix sends envelopes via mail and is toying with wireless internet delivery. Blue-ray and HD DVDs are still fighting over the next disc format. Cable sends movies with a click. Consumers are still confused and we all still have three or four remotes.

Back in the 1990s, 1to1 marketing was supposed to break through such competition. The idea was to identify the customers with the most financial value, figure out their unique desires, and then to personalize content or service delivery in a way that competitors could not match. If anything calls for personalization, it would be the entertainment content consumers receive — since we all have such varied interests. You’d think if 1to1 personalization works, technology leaders such as Apple would be all over it — giving us iPhones that remember our contacts in ways competitors couldn’t, and personalized video or music recommendations so good we’d never switch from iTunes to Amazon. Netflix has offered a $1 million prize to anyone who can improve its collaborative filtering by more than 10%.

But the public and media seem to yawn. We don’t want personalization as much as we want the next, hot gadget. A lot of Apple’s new video interface makes it easy for users to pick from menus, not get pre-customized recommendations. There are only two ways this can play: Either 1to1 personalization is a true competitive advantage and the world’s communications leaders are ignoring the opportunity, or maybe customers need far more than personalization to drive entertainment impulse purchases.

We think 1to1 works, but that its control panel now lies directly with consumers, not business intermediaries. Why should anyone wait for Netflix or Amazon to tell us the next thing we’d like, when we can now find it ourselves with a click? Navigating choices has now become simple with search engines that can pinpoint any whim anywhere from the internet; video will follow this path. Don Peppers and Martha Rogers saw the future back in 1991. They just didn’t see that true personalization would eventually be controlled by each individual themselves.

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