Tuesday, March 17, 2009

IBM/ricoh catch a whale: Citibank uses transpromo on screen and in print.

A friend pointed me to this one last night,
Citibank Targets Ads for Merchants in Online Credit Card Statements
Citibank customers are noticing a new addition to their credit card statements viewed online: ads. For the past few months, the company has displayed text ads from a variety of merchants directly within line items of secure online credit card statements.
From the first few paragraphs I thought the story was going to be about a new use of Google Ad Sense. But then at the bottom of the story . . .
In addition to including ads directly adjacent to line items in online credit card statements, the company recently began featuring similar ads in printed statements, according to a source familiar with the situation who asked to remain anonymous.
. . .
InfoPrint handles the data, ad targeting, and related marketing services, while its clients sell the ad placements, according to Lee Gallagher, InfoPrint manager of direct marketing solutions. "It would be up to [our clients] to...sell that Web space," said Gallagher, who said the system bases ad messaging and targeting on business rules and customer data.
Wow. a Print company doing what Google should do, but doing it first. It warms the heart of this cranky Print evangelist.

IBM is using Print as another lever to deliver Cloud computing to top of the pyramid private enterprise. At the end of the day, IBM sells the hardware and software that deliver massive computing power. Every fortune 500 business needs massive computing power. Maintaining hardware and the software to run it is an expense for private corporations. For IBM it is a profit center.

IBM's maybe insurmountable lead for private enterprise is that "Nobody ever got fired for hiring IBM." If Citibank is comfortable with letting them slice, dice and analyze their customer data, it means the comfort level for every other CIO goes way up.

The way the printernet works
The Print piece is a "nice to have", but not a "must have" for IBM. The cloud piece is a "nice to have" not a "must have" for Ricoh. IBM sold their print piece to Ricoh. Let them run it. Ricoh has deep networks and expertise in making marks on paper. IBM has the deep networks and expertise to deliver computing power. The customer gets what they want, at a price they think is appropriate, without devoting internal resources to get it.

Customers don't care about either computer or Print hardware. But private companies are afraid to give access to their customer data. IBM has a track record and capabilities that eliminate the risk. The Cloud is a profit center for IBM. Print is a profit center for Ricoh.

Win-win-win is the business model of the printernet (the PRinternet for message managers.)

Jeff Jarvis is quoted as saying to frightened newspapers, "Do what you do the best, leave the rest." I might add, if you're not making money, don't do it.

"Transpromo" for large private enterprise has now left the station
The only possible challenger in this space might have been HP. But they got distracted from the toner business when Carly bought Compaq. That put them in the very low margin computer hardware business. Given yesterday's announcement that Cisco is going into the server business, it's not a pretty picture. Meanwhile, HP seems to be still digesting the Extreme purchase. In a Google-Mart economy, time is everything. It seems that HP hasn't moved fast enough.

Large public enterprise Clouds probably mean Google. Google Apps is ready for prime time. When Washington, DC buys a 35,000 seat license, that game is closing fast. Sooner or later the independent MPS sales force or the PSDA sales force are going to join the Google resellers program. As they do, any other enterprise software solution that doesn't link to the Cloud at Google prices, is going to have a hard time.

The ground war has shifted to SMB and mSB
The battle is going to be for SMB (small medium business) and mSB (micro small business.) The good news is that is that is biggest market of all. Given the reinventing of the newspaper business, the advantage may go to Kodak. They own the workflow piece in commercial offset and newspapers.

Added after original post on 3/17 at 9:00EST.
On the other hand HP has already done a Staples and a Tesco deal. But on the third hand, if Kodak and Oce learned how to play together nicely. And if Xerox or Canon or KM gets into the mix, then it would be much easier to create multi-channel marketing programs for small business, delivering Print and Web ads for mSB . . . .

Stay tuned. A clash of the titans is shaping up. The printernet is forming. Yikes, it's starting to feel like 1995 all over again. But this time without the funny money. Just organic growth.

It will be very interesting to see how this plays out.

No comments:

Post a Comment