Keep the faith - see the "Investor Insights" on genmagic.com (apologies if this has been posted earlier). I'm very encouraged by the tone, specifically on "qualitative" observations on mytalk usage being considerably greater than expected, plans to expose it to 10's of millions of consumers, ad premiums for mytalk, and most interestingly plans to link mytalk with kenya to access content over "your favourite websites". Wow!!
Welcome to Investor Insights. Periodically, we will post commentary here from General Magic executives who will provide you with additional perspectives on the impact of news coming from General Magic or within the industry.
June 1999
Attracting Consumers on The ‘Net
General Magic recently launched myTalk, an Internet service that lets consumers access their e-mail over the phone for free. This service is quite different from Portico, the company's fee-based service for mobile business professionals, and its other Web initiatives with Intuit and Excite@Home, where General Magic's role is primarily that of technology provider for its partners.
In this Investor Insight, Linda Hayes, senior vice president of Marketing, discusses the approach General Magic is taking to attract users and build market share in the Internet space.
A casual observer of today's frenzied Internet marketplace might conclude that all it takes for success is the addition of "dot com" after your company name. While a name change might gain 15 minutes of ‘Net fame, building brand awareness among consumers on the Web -- and leveraging that awareness to generate market share and downstream revenues -- is a more complex challenge that requires marketing science as well as creativity.
Before launching myTalk, for example, my team conducted extensive research with users and potential partners to assess reactions to a free, voice-enabled e-mail service. We looked at which demographic groups would be most attracted to this type of offering, what kinds of features were most desirable, and, in particular, how we should incorporate audio ads into the service so users would be comfortable and ad sponsors would find it an attractive medium.
The input we received was valuable on several fronts. Foremost, it helped us define our initial target markets for advertising and other promotions -- the Y Generation and active older adult populations. Gen Y users are early adopters of new technology, very Internet savvy, and very interested in staying connected to each other – all value propositions myTalk supports. The 55+ crowd, which has discretionary income for personal travel, can use the service to conveniently stay in touch while on the road. It also gives them an easy way to communicate with their children and grandchildren who often prefer e-mail over other forms of communication.
With these demographics in mind, we have a number of marketing programs under way that target these specific groups. These include Web banner advertising and broadcast and print public relations initiatives. In the Web banner area, for example, we've targeted numerous sites such as Third Age for the 55+ audience and MP3 and Talk City for the younger crowd. Our public relations program includes outreach to upscale travel and men's and women's publications, as well as lifestyle publications popular with the Gen Y readers. As many of these are monthly publications, articles may not appear until the fall.
Because myTalk is a consumer product, we're doing extensive work with TV and radio outlets as well, instead of the computer/telephony trade press and business magazines that have been our primary media conduit for Portico. We produced a video news release for TV that exposes myTalk to a number of consumers in a cost-effective, easy-to-understand way.
We are also implementing two programs that make use of the Web's distribution capabilities. One is an "opt in" e-mail service that sends information on myTalk to people who have asked to receive e-mail notices of new Internet services. Affiliate Web marketing, whereby "click-through" buttons advertising myTalk will be placed on popular Web sites, is scheduled to start in early July.
Through these initial programs, we expect to be exposing tens of millions of people to myTalk messages in about a month's time. We'll have more programs gearing up in the fall prior to the start of the new school year, focused on the Gen Y user. We've also received anecdotal evidence from myTalk members themselves that shows myTalk has a strong referral factor. People are telling others about the service, and like we've all seen with other free Internet services, a spontaneous, viral marketing effort seems to be under way as well.
People are signing up for myTalk at a rate considerably greater than we expected. That's good news as we meet with more potential advertising sponsors, who want to be sure their messages reach a large but targeted audience. As we discuss myTalk with creative agencies and corporate ad departments, we are seeing enthusiastic response to the service itself. We've received feedback that they really like the planned enhancement of "drop down" ads, which Steve Markman mentioned in his June 15 "Memo from Markman." This will allow myTalk users to ask for more details for a given ad or even be connected to a live operator.
We're also highlighting to ad agencies the fact that unlike traditional interactive and broadcast ads, myTalk audio ads eliminate the possibility of users "channel surfing" to bypass particular ads. With this model, we believe we can command a premium price for ad placements because we expect the return value on the investment to be greater.
While it's very energizing to be doing business in the Internet space, we obviously have a very focused business reason for taking this big step, which is to grow revenue opportunity. Certainly, there is the expectation of revenues through the advertising channel. There is also the prospect of moving users to fee-based services in the future, with myTalk serving as a way to educate consumers on the practical value of voice-enabled services.
And finally, voice is coming to the Web in all manner of ways. We have plans through our voice agent technology, code named Kenya, to allow myTalk to tie in to your favorite Web sites in the future and watch over content when you can't be at your computer. This has the potential to evolve to e-commerce transactions, in which voice and General Magic can definitely play a part.
We're ready to take on the Internet. We have a solid business model with myTalk. We have the best voice user interface in the industry. And we have aggressive Internet marketing professionals onboard who know this part of the industry and are helping us capture the eardrums we need to move forward as a company.
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