History teaches us that it is in times of slowing that the truly winning business realities emerge and today’s one is undoubtedly the first serious slowdown since the beginning of what many have christened the digital age.
While not knowing how long the current period of economic uncertainty will continue, it is clear that it will have a major impact on many families and business activities. Yet the current digital era marks a marked change from the past that cannot be omitted from the analysis of events. In fact, we are faced with mass access to information, tools and technologies that make new behaviors possible and which will hardly be slowed down.
A context such as the current one can only encourage further adoption of digital technologies and greater use of the Internet. It remains to be understood what the companies will be able to capitalize from this contingency.
Today there are 1.4 billion people online worldwide, almost 20% of the world’s population. In Italy it is estimated that 27.6 million people, growing compared to last year, surf the web to learn, have fun, communicate, buy and read up to make more informed decisions.
By looking at the dynamics of today’s consumers, companies can leverage digital technology and media to be more flexible, effective, and focused on growing their business in a time of slowdown.
Consumers trust the information and opinions they find online. With the ever-smaller home budgets available to them, they use the Internet even more to search for the best deals, as evidenced by the growth of over 20% of online directory searches. Moreover, the savings on out-of-home entertainment will encourage greater use of social and entertainment opportunities offered by the network.
The latest estimates on the social networking market on mobile phones speak of a growth that, starting from the 82 million users in 2007, will reach, by 2012, 910 million users worldwide.
In addition, 13 hours of new video content are uploaded to YouTube every minute; an exceptional fact that demonstrates how digital technologies are in effect part of our lives and at the same time are revolutionizing access, sharing and creation of online content.
Compared to the dynamics of business, the immediacy and volume of information available online have radically changed the purchasing process of consumers who today expect to find a wide range of articles at popular prices online and in most cases also being able to buy online what they saw in the store using the help of search engines. These consumers of the digital age are In fact, a series of investigations revealed that it is not just a question of children, as often mistakenly believed, but of adults, aged 25 to 64, and more and more women (42%). Digital marketing, and in particular search marketing, is a targeted tool and today more than ever efficient to reach these consumers at a much lower cost than other media channels. Internet allows companies to get on the market in a flexible way and reach the right target of consumers when it is manifesting a clear information need, repaying the company’s investment for every penny spent.
It is therefore not surprising that the share of investments in advertising on the Internet, at 9% of the total advertising budget, will reach 13.6% by 2010 thanks to the ability of the Internet to integrate with other media and generate measurable results. Obviously we find ourselves in a context where it is difficult to make absolute any estimate. There has never been a period of slowing down so long and critical since the spread of the Internet kicked off today’s digital era. However, one thing is certain: businesses that do not respond to changes in consumer behavior and new opportunities which are being created risk losing competitiveness in the market.
Massimiliano Magrini
Published in the Google Italia Blog.