Several weeks ago Richard Desmond laid the gauntlet to start a good old-fashioned price war amongst the red-tops in July. He proposed to slash his cover price from 20p to 10p, with the aim of driving the Daily Star's circulation over the 1million mark and eventually overtaking the Daily Mirror.

Whilst certainly aggressive & high impact, it was a move that seemed high risk and expensive without knowing the return. To nationally slash 10p off the cover price equates to circa £83k in lost revenue on a daily basis, which is not guaranteed to be made up with increased ad revenue from higher circulations.

Since the story first ran, it appears that Richard Desmond has decided not to go with such a hard line approach, but has adopted the Direct Response mantra instead:

• Test, refine and (and in his case possibly) roll-out.
• The cover price cut will only happen in London - circa 13% of the circulation.
• The test period has not been clearly defined, presumably to pull it if it results are not as they expect.

ARM Viewpoint
Price cutting is usually not a long term solution to grow circulation. As soon as the promotion finishes most new readers will migrate away again. The Daily Star, however, appear committed to it as a long term strategy and since cutting its price in November 2008, it hasn't increased it again.

Whilst increased circulations are welcomed, they can be irrelevant if the new readers are not the advertiser's target audience. All well and good to have a lot more 16-34 yr old women reading the title, but if the target customer is a 50+ adult, the impact on an advertiser's business will be zero.

Additionally, the price cut has angered the National Federation of Retail Newsagents who said: "The Daily Star could now have made a fatal mistake in providing a margin for retailers that, in economic terms, no longer justifies its place on retailers' shelves in all but a few stores that have exceptionally high sales."

Google recently announced that they plan to break down the barrier between traditional and digital media with their ambitions to infiltrate the TV market, harnessing the power of search and transpose its functionality onto digital television box sets. This enables users to surf programme schedules and on demand programs through a search function built in to the top box. Manufacturers such as Sony and Logitech have already put these into production and has been famed as the principal contributor to the demise of the TV guides deity, and one giant leap in the direction of audience interaction. Google have commented that they aren't trying to become the all omnipotent content provider and instead will try and collaborate through partnership with broadcasters.

ARM Viewpoint
At the crux of this development are the repercussions for advertisers, and in particular direct response advertisers. Existing agency relationships with the search giant means that an infrastructure of trust has already been established, and agencies will more likely attribute a test budget to this new medium. The technology will arguably allow advertisers to reach viewers more cheaply and effectively than via traditional TV spots and next to relevant environments as a user's journey can be tracked similarly to that of search engine marketing. Cost per click links appearing next to programme schedules could elude to a new era of TV advertising, direct response clickable adverts featuring either side of content could herald beautiful symmetry between the two previously succinct platforms. This is a major development from the viewpoint of direct response advertisers as transparency in the path to conversion is the key axiom to the success of any campaign. Their recent buyout of CORE media, which will act as Google TV's analytics tool, makes the new medium even more attractive to DR clients as all costs can be attributed to an action.

Although it will allow viewers in the UK to see programming from the US without having to wait a few weeks, it could mean that pay walls around content restrict viewing access in other money making jaunts. Google, the democratic information provider, could fast mutate into the content tyrant of the century. The technology itself throws up questions about usability, as a Google Android phone user I invest no faith in the competence of the voice recognition system. Resolution will also be critical as with the popularity of HD screens will this even be remotely comparable to the 1080p quality of alternative offerings? Arguably the development has already proven to be a lucrative one; the children's market has become saturated with interactive ad placements on Play Stations and X- Boxes, which hopefully eludes to an exciting era of interactive direct response media in the adult market through similar means, we will certainly be recommending this to our clients in the near future.

We all know mobile will be massive. It makes sense, you can see it happening and it is already gaining significant traction. Google figures show mobile search up 40% Y on Y in Q1 2010. Mobile search, it is estimated, will be bigger than Desktop (PC/ laptop) search by 2014. A few facts of interest:

• Average smartphone user is 33.
• Easyjet have found that mobile bookers are more likely to book within 14 days of travel (38% vs 14% from PCs). And these flights are more expensive and profitable.
• The development of HTML 5 means that cleaner quicker pages can be designed.
• There are only 5 search results on mobile (2 paid) so bid prices will be premium in future.

ARM Viewpoint
Our early campaigns for our clients show that Mobile Search results are very good. The CPC's are generally lower, likely due to the fact that some people opt their campaigns out of these devices, but this will probably not last due to demand and supply - the restriction on supply being that there are only two ad positions at the top of a mobile search screen as opposed to the usual five.

But, crucially, we are seeing that conversion rates for our mobile campaigns are also better than Desktop search, so Mobile CPC's could even go higher than Desktop search costs and still get a similar ROI. Again it makes intuitive sense that a mobile searcher is probably more highly motivated with a need to be solved now.

Basically you need to get started in mobile search now, get first mover advantage and early learnings in ASAP. 3 tips to get started:

1. Review current performance: Compare how your ads are performing on both desktop and mobile devices if applicable.
2. From now on run separate campaigns: Devising a separate strategy for mobile users can help you yield better results from your campaigns.
3. Test the user experience on your site for mobile - Do you need a mobile optimised landing page?

SeeSaw - the free and paid-for programming video-on-demand (VOD) service has failed to meet expectations, falling behind its competitors, according to recent UKOM figures.

This is by no means a reflection of the growing VOD market which has seen ITV and Channel 4, and rival aggregators MSN Video and You Tube record positive performance figures.

The common denominator between these is free quality content. SeeSaw may dispute this and justify their charge on some content, but the fact that You Tube offers the same content partnerships plus Channel 4 longform for free gives audiences an easy decision between the two.

Audiences are however clearly torn between where to access VOD. With so many competing aggregators offering similar content, plus ITV, C4 and Five funding their own VOD services, providers are finding it difficult to thrive and cut through the cluttered market.

However this could well change due to Project Canvas, Google and Apple TV entering the market with their internet enable set-top boxes. Portable VOD via smartphones, iPad and laptops will still have a role, however the three set-top box providers are likely to consolidate the market.

The mere presence of Project Canvas and those involved in it, Google and Apple into the VOD market is the firm evidence that this can only grow, leaving no doubt that marketers must now be looking at the opportunities available.

ARM Viewpoint
Despite SeeSaw performing poorly, ITV, Channel 4, MSN Video and You Tube figures show that VOD certainly is growing as a market and is an opportunity that must be seriously looked into from a customer acquisition perspective.

Online advertising has already proven to work for direct response advertisers, and VOD offers the same click-through platform with an interactive, call-to-action, measurable and accountable spot advertising campaign.

As planner-buyers we must quickly understand this market and identify how it can and will benefit our clients. We must realise where the commercial opportunities lie by removing the clutter, learning and understanding more about how and when VOD is used and responded to by target audiences.

VOD has the potential to revolutionise direct response TV.