online advertising – Silicon Valley Technology Blog

Look At This Social Media Advertising Done Right – Vertical Advertising Is The Model

For those who follow my blog know that I’ve been a big proponent of social media, but the problem is results and measurement. Airforce is doing something innovative with their agency and Volomedia. I really like this announcement from G4 and Volomedia. Volomedia has signed up a big publisher and a big advertiser to insert ads in portable media and video. The best part is that it work on ITunes and the Iphone. I’ve talked about this before around how iTunes (and IPhone) now has a business (revenue) model.

Comcast’s G4 cable television network and Web site G4tv.com have begun working with VoloMedia to insert ads into the 300 podcast videos distributed monthly through about 23 feeds. The ad network began placing ads for the media giant last month, targeting young gamers.The U.S. Air Force placed the first ads in G4’s podcasts: Attack of the Show, X-Play, and Game Trailers. Sunnyvale, Calif.-based VoloMedia’s new vertical business, Video Game Podcast, supported the ad campaign created by GSD&M Idea City, the advertising agency for the Air Force.

What Does This Mean? Why is this important?

Vertical media works. The trend is away from individual sites or blogs but instead to ‘blanket the vertical’ with brand messaging. In turn effective reach in a vertical hits enough critical mass that brand equity translates. Said another way the most effective way to leverage things like blogs and podcasts is to ‘buy’ the vertical. The dynamics of social networking and social media create an opportunity to hit alot of people in the affinity group. What’s even cooler about this announcement is not only reach but measurement. This is a good move by the Airforce to get a vertical – here it’s gaming as the ‘contextual’ proxy for audience affinity. It’s a no brainer that gamers are their target audience, but instead of going for silo’d conversion, Airforce is going for blanket coverage in the vertical or affinity group.

I predict this is the way the world will go very quickly. Vertical media advertising. This is a great program for brand advertising, and it has measurement. I am sure it will be a success.

Discovery, Navigation, and Collaboration – Hello Holy Grail – Facebook Is Soaring – They Will Be Huge – Trust Me

I am a big believer that Facebook’s massive growth is bigger than most people think. They are pushing a utility that delivers big time value. Over the past year I have been studying the utility of Facebook and can tell you that it’s not about just sharing and throwing sheep – It’s about people in a new paradigm. Facebook has the opportunity to take a very strong value proposition and evolve how users discover and navigate (the core principles of search) BUT more importantly they are in the exchange position of real value – actionable value transfer. Simply put: they broker transactions from finding lost friends, staying in touch with existing friends, making new friends, to finding and buying products and services. They can be a hub of collaboration of all sorts. All of those elements make them poised to make it big time. If they continue to keep their eye on the user experience (utility) ball then they can get there. Their numbers are just too big to be dethroned. The only way Facebook will miss the opportunity is if they screw it up on their own. Facebook as they say is ‘gold plated’.

Here is a post from Facebook’s CEO Founder Mark Zuckerberg.

Today, we reached another milestone: 150 million people around the world are now actively using Facebook and almost half of them are using Facebook every day. This includes people in every continent—even Antarctica. If Facebook were a country, it would be the eighth most populated in the world, just ahead of Japan, Russia and Nigeria.

When we first started Facebook almost five years ago, most of the people using it were college students in the United States. Today, people of all ages—grandparents, parents and children—use Facebook in more than 35 different languages and 170 countries and territories.

The full potential of the web is to make the world more open, so everyone has a voice and can share what is important to them. With 150 million voices and counting, we can’t wait for the rest of 2009, and we look forward to offering even more ways for you to connect with the people who matter most.

New York Times – A Failed Ad Strategy

New York Times is now selling ads on their front page. I have to say that I didn’t even notice. This is the reason why it’s a failed strategy. Trend is away from print to online and that is where the NYTimes should be focused. Not only are web users not clicking on display ads, a new crop of software led by Adblocker Plus is blocking all the ads. Adblocker Plus used on about 10% of all web users is quietly gaining ground as a tool for end users. I wonder if the New York Times will see the impact of the fact that display ads are being blocked.

From Adage.

The New York Times unveiled a display ad on its front page, despite decades of fear that advertising there could contaminate the journalistic product or brand.

Today’s ad, which promotes CBS, occupies a strip of real estate two and a half inches high at the very bottom of page A1.

Today’s ad, which promotes CBS, occupies a strip of real estate two and a half inches high at the very bottom of page A1. That makes the unit less noticeable than the boxes available on the front of Rupert Murdoch’s Wall Street Journal, but it’s still a big departure for the Times.

In a statement this morning, the Times pitched the turnabout as win for marketers. “In 2006 we began testing ads on some section fronts and received a very positive response from the advertising community,” said Denise Warren, senior VP-chief advertising officer for the New York Times Media Group.

Taking its situation seriously
But it’s also a clear reflection that the Times is taking its situation seriously, something that was questioned after a recent presentation to investors and analysts. The New York Times Co. finally cut its costly dividend payments last November but drew fire for failing to suspend them altogether. “It just seems the reality is it’s a very, very difficult business right now, newspapers,” a questioner told executives. “And the notion that cash is flowing out of the company to the equity seems — it seems like you may not understand the gravity of the situation.”

In a funny way, the awful business environment may have actually freed the business side to sell the ads without worrying about an outcry from the newsroom.

“While three years ago the notion of the august New York Times serving up front-page ads would have stirred emotions far and wide, today it’s a one-day story,” said Ken Doctor, a newspaper vet turned media analyst for Outsell, a research and advisory firm. “When someone doesn’t have enough to eat, he doesn’t quibble about the source of the food.”

Made their peace
Many other papers have already made their peace with front-page advertising. The Journal began selling front-page units in 2006, carefully milking their potential to get big commitments from the five marketers allowed to buy them each year.

“Every single purchase has with it an annual commitment, an online commitment,” said Michael Rooney, chief revenue officer at Journal parent Dow Jones. “Some are multiyear, and some are global as well.”

With such prominent ad units, of course, it’s easy to wonder how the big articles next to them hurt or enhance their effectiveness. General Motors and Hewlett-Packard ads have bumped up against negative coverage of their own companies.

The front of the Journal’s Marketplace section today, on the other hand, shows an Oracle ad next to an article pegged to the Consumer Electronics Show. That’s an adjacency Oracle might have liked to arrange — which in turn is a possible suspicion that bothers opponents of these ads. Mr. Rooney said the paper never talks about news articles with advertisers. “It’s just not a conversation we would ever have,” he said. “Whether it’s the B section, the A section or anywhere in the paper, we sell our audience.”

Off the table
Last June The Washington Post’s new publisher, Katharine Weymouth, told Ad Age that front-page ads remained off the table. “I’ve had advertisers beg me to put ads on the front page, and we’re not ready to do that,” she said. The same goes for ads on Post-it notes affixed to the paper. “We declined to do that because we thought it cheapened the front page.”

Since then, of course, the economy has worsened dramatically. The Washington Post Co. saw print-ad revenue at its newspapers fall 14% in the third quarter.

This morning Ms. Weymouth confirmed, however, that the Post still doesn’t sell front-page ads. “No,” she e-mailed Ad Age. “The Washington Post does not currently accept front-page ads in our print edition.”

Online Video – Trends Content Models Advertising Models At NewTeeVee Live Event

I will be moderating a panel that is sponsored by Volomedia at NewTeeVee Live. It will be a workshop on content monetization at the NewTeeVee Live conference in San Francisco this Thursday, November 13 at 3pm.

The panel is titled “Pennies Today, Dollars Tomorrow: Learn How To Make Money In The Media Transition As Television Moves To The Internet“.

Pennies today, Dollars tomorrow. Learn how make money in the media transition as Television moves to the Internet.

As content moves from controlled programming to a decentralized, multi-platform distribution model, solutions are required to engage, measure and ultimately monetize this audience. The session will explore this cross-over from television to online and devices, and discuss opportunities while maintaining control of your digital distribution for the anywhere, anytime audience.

Moderator:

John Furrier, Founder, Furrier.org

Panelists:

George Ruiz, Head of New Media and SVP Business Affairs, International Creative Management
Susan Bratton, CEO and Co-Founder, Personal Life Media; Vice Chairman, Association for Downloadable Media
Murgesh Navar, Founder, VoloMedia
David Smith, Founder and CEO, Mediasmith

I hope to get to address the following types of questions

Trends
•    Environment: real-time verses asynchronous, social network, web sites, blogs, podcasts, ..etc
•    Distribution: reach, metrics
•    User: Online content viewer, preferred method of consumption, how do you define good content?
•    Advertiser: social media, engagement, loyalty, conversion?
•    Other: iPhone, downloadable, streaming, content development, distribution systems, content franchises, affiliate models

Content Model
Value proposition of content online? What is an example of a successful content franchise?

Value of content or value of brand?

Success models of content deployments

Content formula: Speed and Control;
Speed: (slow verses fast) and Control (high vs low)

Open distribution: sampling verses giving away the ‘store’
Tasting (sampling) ? SNL verses Olympics

Concept of a viewer? Is it the same as broadcast? Does the notion of a “viewer” matter online?

Is there risk in being open or is risk overstated?

Is there a ‘holy grail’ metric for content publishers? Engagement, viewers/listeners, loyalty, commerce, ..etc ?

Content models: ad supported verses subscription – are there any other kinds?

Business model: is it just promotion or is there a “there there”?

Advertising Model

Are ad networks working?

What are advertisers looking for in the new tee vee environment?

Role of brands? Is it about the brand?

Role of the agency?

What works what doesn’t work?

Audience engagement – what does it mean? Benefits to advertisers?

When does an advertiser know when it’s working? Are there identifiable tipping points out there?

How do they plan for future campaigns?

Budgeting and media buying of the future?

Here is a video of George Ruiz – Taken by Tim Street in LA. George is an agent and talent king and has been a successful film studio exec and negotiator.

My Prediction is Validated About Business Model Of Video – Give Users What They Want

Taking credit for big trends is all the rage these days of blogging. So here is my self promotion post on the future of online video and future of online advertising. 🙂

Today the news in the NY Times tells us about the future of online video and advertising. It comes as a shock to many people including Mike Arrington, Mathew Ingram, and others. With headlines from Wired like Hulu Celebrates First Anniversity, Gain Popularity By Serving Fewer Ads.

As predicted by me years ago and blogged here at Furrier.org – “Content is the Ad”

Hulu’s success is due to the a great user experience verses forcing the maximizing of moneitization. That is why Hulu is not littered with Ads. Why? Because the content is the ad. SNL’s franchise on TV is their product and their online distribution (widgets) is their ad. NBC TV broadcast was the product and their online coverage was their advertising. Why do the big content people do this? This is going to sound too simple – they know what the users want. And their product (main content franchise) gets a reward for it – more viewers. Badda bing. Simple.

One more time – CPM ads don’t work in social network or online in targeted user groups – said again for the zillionth time

How do you monetize: the plans for this new content model online will be different. Expect to see new contextual and behavior tools that serve users – a utility of some sort. For now it’s all about cross-promotion.

Successful online strategies have been successful if they do three things: 1) easy to use, 2) reduce steps, and 3) save time

Anything online that distracts users will lose – online experiences must be value-add. Advertising can be value-add and I expect new advertising solutions to be of value.

Blogs More Effective In Web 2.0 Advertising

I saw this from Caroline McCarthy at Cnet today and agree with this study. In the many years of research in online advertising and web 2.0 it is very clear that one of the roles a blogger plays in their area of coverage is one of newsmaker and analyst.

I did a speech at MIT in 2006 called “The Blogosphere: New Navigators.” – in this speech I predicted that certain blogger would asend to the highest trust level in communities to earn a place of trust. Why? Because to be an effective blogger you have to know about the sector your covering. To capture news, get scoops, provide content value, you need to know what you’re talking about. Bloggers provide a real time service for users. Often bloggers make mistakes, but more importantly to users they provide links to other sources that delivers on the real time alerting or redirection of attention and interest (this is what normal users are looking for). Of course bloggers self correct or get corrected from their audiences. This content cycle is two way and very effective in content development, story development, fact development, and opinion development. This makes them valuable to users. (side datapoint: the best analysts of top firms have become bloggers – why?? ..Point made)

I am shocked to see marketing people pass on sponsorship of the top influencial blogs in their sector. Yet pay 100k for an analyst firm to do some survey. Blog advertising and sponsorship is the best game in town for marketing executives. Here I posted about the Future of Blogging last week.

Of course I’m biased but do see direct results everyday. Tell me if you agree?

Future Ad Model Reveals Itself – Self Service Display – In the darkest hour the future online advertising business model has shown itself

Self service advertising is the killer app. Brian Morrissey at Adweek just penned the future of online advertising. I’ll say it here and years I predict I will be referencing this blog post.

I’m calling it – Self Service Display Advertising is the new scalable model for online advertising – the heir apparent to search and keyword marketing. It will range from Podcasting insertions to social networks.

I’ve been researching this notion of a vertical engine for matching affinity data to user context for two years. The results: everything points to self service display. Content is the ad and the complexity that Brian refers to will be handled by the advertisers – sort of vertical engine of advertising – best of contextual and behaviorial targetting rolled into one model.

This is the future model that Facebook will adopt for monetization – everything else that they (Facebook) says is a smoke screen. Even worse if this isn’t on Facebook’s roadmap then they better move fast.

In the darkest hour the future online advertising business model has shown itself (again just like in 2000) . It will be a race to see who can build it first at scale.

Facebook COO Sherly Sandberg Desperately Looking For An Ad Model

Here is an AdAge story about Facebook and their need to find the revenue model.

UPDATE:
Rob Hof Editor-in-Chief at Businessweek comments and links to his view (he was there) below that Sheryl Sandberg main point yesterday is not what AdAge was reporting. It seems that Sheryl was saying that the only thing around today is demand gen. Thanks Rob. Rob also points to Mediapost which has a followup. Apparently the real twist in this is that the Advertisers want a solution. This sounds familiar – I feel like I’m in early 2000 again. Search went through this growing pain. Whoever delivers the solution will ‘mop’ up the revenues. THANKS ROB

UPDATE 2:
Over on the metarand blog there is a good post on this by Randal. I like his analysis but would disagree with Randal on the monetization focus and his reference in Jeremy Liew regarding to online advertising growth. Online advertising is a growth sector and will NOT slow down in the medium to long term. Maybe short term yes but long term massive dollars are going that way. If you look at the IAB stats from 1999-2001 there was gloom and doom. Then look at 2002-today. Massive growth. As Diller says no one has the answer yet.

Facebook’s latest attempt to finally get some real ad revenue has shown early signs of promise, Chief Operating Officer Sheryl Sandberg told an audience at the American Magazine Conference in San Francisco yesterday.

“The results were really positive,” Ms. Sandberg said. MTV not only got some attention for its awards show, it learned a little about what viewers wanted to see. It and other networks have subsequently said they want to try using the product earlier, to make the most of that feedback, she said.
“The monetization question on the web is a very big and open one,” she said. …Ms. Sandberg a former Google executive, noted. “What no one’s figured out how to do is demand generation,” she said.
“We need to find a new model and new metrics,” she added.
“Walled gardens don’t work,” she explained.
“People are using our product to protest our product,” she said, noting that a protest group is now the fifth largest on Facebook.

These quotes speak volumes about Facebook’s lack of awareness to how online advertising works. Pesonally I don’t think that they have to produce the monetization answer right now but instead just focus on the product leadership and key business development deals. I have no idea why Sandberg even entertains the monetization question at all.

Here is my favorite line from the Barry Diller interview on online advertising..
On Internet advertising: “You really want to get a headache? Try to understand Internet advertising. Social-networking advertising is being discounted because there is so much inventory [of available ad spots], and because methods have not yet been found to make it very effective. Will that get figured out? I absolutely believe it will. What form will it take? Absolutely unknown.”

Sheryl you have nothing on the ad side yet just admit it and work with advertisers to get the right solution in place.

Hey Online Video is Growing Big – Not a Surprise Online Advertising Video is a Real Market

Having founded and ran a media platform (video) startup since 2005 I’m not surprised by the recent reports that online video advertising is growing big time. This shows to some VCs who have been not so bullish on video and advertising that the online video platform business is real and relevant (note my VCs wanted to turn my vision of building a media advertising platform into a production company and PR agency).

The problem is that most VCs and new players to the online video market are having a hard time figuring out the business model. Not sure why – it’s pretty obvious it’s advertising. The problem or better yet said “opportunity” is that the ad unit needed to leverage these new networks, new content types, and syndication/aggregation technology just isn’t here yet. It will be soon. I know a few great companies working on that vision. As soon as the ad unit and enabling infrastructure supports performanced based contextual videos the money will flow.

Liz Gannes over at NewTeeVee has a good post on the recent Lehman numbers that online video is growing (she has other numbers as well from other sources).

Here is the text from Liz’s post:

The investment bank Lehman Brothers, which basically discounted the potential of online video advertising in a recent report on digital entertainment, now puts a number on that market: $1.1 billion in U.S. video ads this year, rising to $2.4 billion by 2010.

Lehman had previously forecast that video-on-demand and iTunes revenues for studios would climb to $2.5 billion in 2015 from $319 million in 2007, so paid content and ad revenues are at least in the same ballpark. Of course, they’re nothing like traditional television numbers.

The report isn’t available online.

The Lehman forecast for online video is pretty middle of the road, even a bit pessimistic compared to those of other firms (though most predictions tend to extend a couple years further out). Parks Associates sees $6.6 billion in 2012 in U.S. online video ads by 2012; Forrester is looking for $7.1 billion by 2012; and eMarketer says $4.3 billion by 2011. And In-Stat said today that it expects $4.5 billion in worldwide revenue from all online video business models by 2012.

In other revenue projection news (which there seems to be a ton of today; see Chris’ report on premium video revenue), eMarketer points to an iSuppli report that projects $3.8 billion in worldwide mobile advertising revenue by 2011, up from $427 million in 2008.

All of these discussions remind me of the early days of the web when then online advertising spend was always compared with traditional advertising spend. I think that it’s safe to say that the ad dollars are shifting online fast. At what pace will determine the magnitude of change of these forecasted numbers.

I’ve been recently bullish on live video as well as downloadable media. The combination of Live and Downloadable is very compelling.

Why Current Social Media is Crashing – Traditional Advertising Doesn’t Listen – Doesn’t Work For Social Media

In a post by Paul Daigle called the Net Effect. He talks about how advertising doesn’t work in social media because traditional advertising doesn’t listen it only talks.

I think that this is a wake up call for all the Social Media executive out there and C-level executives trying to understand social media. Social media a half ‘Groundswell” (book written by Charlene Li and Josh Bernoff) and half “Book to be announced” (not yet published – Peter Drucker like book). The business process improvement aspect of social media – the impact to organizations in how they organize, talk to prospects, and customers. More importantly how companies compete.. words like ROI, finacial impact, leverage, revenue per employee, benchmarking, customer service, and business intelligence will trump words like engagement, conversations, storytelling, blogs, podcasting, viral branding.

Rather than me going on again and banging the drum about my view I’ll let Paul say it and he puts it in a business light.

Paul writes..

“Every week a new article seems to redefine what social media means for brand advertisers. This communicates, accurately I think, that the advertising and media industries are still working to understand how they can best help their clients capitalize on the new social media opportunity.” …

“Advertising doesn’t know how to listen. It only knows how to talk. So talking with advertising people about social communities is like telling an accounting department how you can increase sales. Sure, you can run traditional ad campaigns within social settings, but the real opportunities being advanced are not advertising… but communication opportunities. This misalignment between the goals of marketing decision makers and opportunities being offered is why many companies are moving so slowing, and acting so suspiciously of social media.”….

“Advertising isn’t going to go away, and it isn’t going to change. Nor should it. Advertising, as we know it, will remain an important way to build brand and drive sales. But developing social strategies and advertising strategies are completely different vocations. I don’t believe marketing or advertising departments are where tomorrow’s corporate social initiative will reside.”

“In order for companies to succeed socially, they will have to restructure to become social entities. It will happen, but it will take time. Helping companies understand where their social assets lie and how to synthesize these assets to create modern CRM departments maybe the answer. These new departments would strive to manage the ear, face and personality of the business, and help the company engage socially to win. In the real world, when we represent our companies at social events we do so knowing who we are, why we are there, who we are speaking with, and what we’d like to accomplish. We know that our success requires that we engage the room in conversation and that we listen.”

Brand Advertising Social Media Trend: YouTube Needs the Advertisers to Catchup – Don’t Do PreRolls

What’s an example of Social Media? Make something social and sharable. Gatorade has a success on their hands. It’s not to the level of Coke Mentos but it’s close.

There has been talk about the opportunity for brand marketers to connect with users of a new generation. Also, YouTube got slammed by a Wall Street Journal article on their lack of monetization. The problem is that brand marketing will be done differently. Here is the Gatorade commercial on YouTube. It’s not a commercial but a piece of content created for the community. As I have been saying on this blog for a year “Content is the Ad”. Wall Street Journal is missing the point and if YouTube does pre-roll then they will lose users fast.

YouTube should continue to serve users by providing a great user experience and let the advertisers innovate – not the other way around. Hey Chad Hurley: Don’t do prerolls! Let the advertisers innovate on the copy strategies that work for YouTube and don’t change YouTube for what is a behind the times advertising market. This Gatorade ad is a great example. Companies like Intel should do this rather than doing those boring NPR sounding videos. Brand marketing is about respecting the audience and delivering content that they will enjoy and find valuable – not a marketing piece.

What’s interesting is that this Gatorade video has millions of impressions over multiple users reposting it. The penetration is amazing.

The big deal is that this isn’t some boring product specific video talking about Gatorade. It’s a product placement ad that speaks directly to the Gatorade demographic. Was it successful – sure thing. It connected with their audience in a mode that they enjoy. It’s respectful and not a overproduced in your face Gatorade ad – like on ESPN.

Here’s the ad look for the product placement. Gatorade gets the benefit by not mentioning Gatorade. This trend will continue.

Social Media Alert – Ding Ding

This is a great blog post by Joe Marchese of Mediapost.

This is so spot on that it is worthy of a reprint in full here see below. Epic post from Joe Marchese of Online Spin blog at Mediapost. This is a very timely post and very right on the money. Great blog reporting. Thanks Joe. I fully endorse Joe’s view. Here here..

Traveling during the last 10 days, I have had 26 meetings and two speaking engagements. I have had some amazingly insightful conversations with some of the smartest people about the social media challenge and opportunity, from the media agency, creative agency, marketer, and publisher perspective. One theme kept popping up: It’s not that media shops, creative agencies and marketers don’t see the potential of social media, it’s that agencies, in their traditional role, have developed an organization that does not support the proper activation of social media for brands.

Put simply, Madison Avenue wasn’t built to service brands in social media and, more importantly, Madison Avenue is not built to make money from the proper activation of social media for brands. The question is, can the system adapt, or will a new breed of agency be born in the vacuum of effective social media campaigns? Evolution or revolution? I have seen evidence of both.

Activating a brand in social media delivers a variety of benefits. Social media’s conversational nature means that a campaign can deliver a lot more than simply message distribution. Social media can give a voice to a brand’s customers (or those a brand would love to have as customers).

The effective social media agency will:

Be a long-term partner. There are no “campaigns.” People will continue a conversation even though the calendar says you should be moving into a new campaign. Starting and stopping social media campaigns is guaranteed to waste resources and have very poor ROI. All the effort goes into building the social media conversation, and the positive ROI is really achieved once all you have to do maintain the conversation (which requires a lot fewer resources). For this reason, agencies effective in social media will look at multi-year engagements; rather than start and stop social media campaigns, they will work to help direct the conversation to achieve a brand’s goals. As Adam Broitman of Morpheus Media said on my panel: “you shouldn’t think in terms of running a social media ‘campaign,’ but instead think in terms of making a social media ‘commitment.'”

Provide product feedback. Your social media supporters are your customers as well. A social media campaign, therefore, will allow an effective agency to deliver very pointed feedback directly to a brand’s product team.

Provide message feedback to creative. Stuart Elliott of The New York Times, one of the people I had the pleasure of sitting with over the past 10 days, made the observation that when television was first introduced, advertising was having people stand in front of a microphone reading off a script about a product (like radio). It dawned on the industry that this new medium meant that new methods of advertising were possible — and that they should capitalize on TV’s unique picture and motion qualities.

You can’t predefine your creative in social media, because it is a conversation. To predefine your creative would be like entering a conversation with a script, and no matter what the other person says, continuing to stick to your script. You might as well be standing in front of a microphone reading a product description. What a brand’s social media activation partner will do is to make sure that people’s feedback is properly distributed to the creative teams so that they can iterate on the creative elements. For more on how this is developing, read Brain Morrissey’s recent Adweek piece, “Shops Strive for a New Formula.”

Achieve social media message distribution. Of course, the effective social media agency will be able to measure and enhance the amount of distribution, or people sharing and talking about your brand. Rather than simply buying the media, a social media agency will know the various levers it can pull to help distribution — i.e., more creative assets, games, etc., to create involvement.

Measure the ROI of brand campaigns (both inside and outside of social media). Social media is made up of people who buy brands — and who frequently talk about what they do and don’t like. Thus there is the ability to measure the effectiveness not only of your online social media efforts, but all of your various marketing efforts. It’s up to the right agency partner to pull this all together for a brand.

An agency’s new role in social media will be to maintain a brand’s presence and extract various benefits that a brand should receive from making a social media commitment. To do this will require redefining the media agency’s role. It will be far more consultative. It will interface with more facets of a client’s organization. Tapping into all the ways an effective social media agency can deliver value to marketers, will set apart this new breed of agency. The skills required to coordinate effective social media management will command the margins required to support Madison Avenue.

Social Media Secret Sauce ? It’s all BS – The Best has Yet to Come

Jason Heller writes a great post on Social Media. Jason starts his post with the following.. “Are you a traditional marketer or agency person, or even a digital agency person who is frustrated at the new crop of “social media elite” who claim that they know all the answers? Or…are you a social media marketing maven who is frustrated that the rest of the industry just doesn’t get it?”
There is so much bullshit being thrown around in Social Media these days you wonder what’s up or what’s down?

Readers here know that I’m bullish on Social Media, Social Advertising, and Social Everything when it comes to online marketing. I’ve been there from the beginning so I can say that Jason’s line about people knowing all the answers. No one knows. I’ve been doing R&D for three years in social media and even today it’s still wide open. No one has the answers. It’s evolving.

The only constant is the Internet – it is working and it is providing the utility in social media. The problem is that most successes happen by accident – that is experiments that have performed positively – aka “lucky strike”.

Social Media is like making a sauce – everyone can try but only talented marketers with the right ingredients can make it work. Additionally the infrastructure is changing at a platform level so the ROI answer is elusive but available.

I have been documenting many of my experiments of what works but there is no silver bullet. How to crack the code in Social Media. For insight into how to crack the code in Social Media Marketing check out this post that I wrote last week.

Social Media for marketers requires a certain understanding of the key dynamics of Web 2.0. For the dynamics in the Web 2.0 world check out this post that I wrote.

Of course Microcontent will be a big trend ….etc

There are some great people working on Social Media and Social Advertising models and soon we’ll see great results. I’m in agreement with Jason if you hear someone say that they have the answers start running for the hills.

For information on my research (which isn’t published) just sponsor this blog 🙂

Update: Jeremiah Owyang has a great post of the folks doing social media work in the corporate world. This list is very comprehensive. This is the list of folks doing the research or Marketing Engineering. It lists the companies doing the work (corporate companies). I like this list because I’ve worked with most of the folks on there and all are doing great work. The discovery of the secret sauce in social media is around the corner.

Online Ad Spend Soaring – Will Hit $106 Billion in 2011 – What Recession?

Marketers worldwide will increase their spending for online advertising at a 15% to 20% clip in the coming years, a growth rate that is “phenomenal,” industry research firm IDC said today.

This year, global spending in online ads will reach $65.2 billion, or about 10% of the total advertising market. As marketers continue to recognize the importance of promoting their goods and services online, they will increase their online ad budgets.

In 2011, online ad spending will hit $106.6 billion, accounting for almost 14% of the total advertising market, according to IDC.

Keyword-based search engine advertising will remain the most popular online ad format through 2011, accounting for more than one-third of the online spending.

It will be followed by Web site display ads, such as banners, which will account for more than 20% of the online spending, and then by classifieds, representing almost 19%, according to IDC.

However, rich media ads, like those in video format, will see their spending grow faster, at an average rate of more than a 50%, IDC said.

The U.S. will lead the global market in online ad spending with $45 billion in 2011. But the fastest growing regions will be Central and Eastern Europe and the Middle East and Africa, with average annual growth rates of 42.1% and 29.8%, respectively.

The region where online ads will have the largest portion of the total ad spending pie will be Western Europe, where marketers will devote 18.2% of their budgets to Internet ads in 2011. In Japan and the U.S., the percentages will be 16.3% and 14.6%, respectively.

Today’s leading categories of online ads, adult content and gambling, information, electronics, and computing, will still be the top ones in 2011, IDC said.

Today, the PC is the preferred device for accessing the Internet, but that will change in 2012, when it will be surpassed by mobile devices, IDC said.

Social Media: How To Crack the Code in Social Media – It Takes Marketing Engineering

I’ve been tracking social media, social networks, RSS, Internet infrastructure, and online advertising for over 10 years. One thing that I notice is that hype can dilute reality.

There is so much “bull” being thrown around out there regarding social media it makes my head spin – blogging tools here, wikis there, engagement this, conversations that, metrics this, ROI need,..on and on.

The elephant in the room is that it’s early and no one has cracked the code on social media – how to define it, program it, deploy it, measure it, and scale it across their company.

Here is a good post from Mediapost Online Spin blog by Joe Marchese. He is hosting a panel to talk about this. His guest are Augustine Fou, SVP, digital strategist, MRM Worldwide, Greg Verdino, Chief Strategy Officer, Crayon, David Berkowitz, director of emerging media and client strategy, 360i, Rich Gagnon, Chief Media Officer, Draft FCB, Adam J. Broitman, director of emerging and creative strategy, Morpheus Media. Should be a good panel. These guys on Joe’s panel are at the cutting edge so I’m looking forward to hearing the discussion on Joe’s panel.

What’s relevant about Joe’s post is that he nails the market: summed up in a word – experimental.

He also goes on to note..”The even funnier thing is that this is both shocking and not surprising. It’s shocking, given the reach and depth of connection social media offers, yet not surprising because no one has unlocked social media in a way that demonstrates return on marketing objectives, such as reasonable expected range of outcome at for set amount of resource allocation. If you are a brand or an agency, there is not much more you can do but test various methods and watch longingly as your potential brand advocates and customers participate in a media category without you. But it’s not the end of the world, as long as your competitors don’t figure out how to benefit from social media in a scalable manner before you.”

I like this post because I’ve been doing research on cracking the code on social media specifically for over 3 years. I’ve run dozens of experiments before I started PodTech, while at PodTech, and now for the past 10 months after I left PodTech. The findings are interesting.

What does it take to crack the code on social media and social advertising? The answer might just be staring you in the face. It starts with getting the right people on the staff (expertise), running many experiments, having an realtime analytical audit, analytic audit analysis, and finally mindset based in reality.

The hardest part is finding the right people. It needs to be figured out by the right mix of personnel. It isn’t just PR or just marketing. On the personnel side it’s more like infrastructure engineering expertise. Social media is a based on web services so it takes “marketing engineering”. Marketing engineering isn’t the primary skill of PR executives. Instead it’s the business and technical programmers that have the expertise and knowhow. Successful social media teams have engineering backgrounds on the team.

The great thing about the web is it’s biggest problem for marketers in social media – Everything is Measurable. Does that suggest that the ROI problem doesn’t exist? The biggest challenge is to define what to measure.

How to crack the code in social media: put the right team together, run tons of experiments, know what to measure, and measure. The solution might just be staring you in the face.

Social Media is Web 2.0 – Relationships – New Linchpin for User Value

Mike Arrington weights in with his opinion of social media. He makes a relevant (pun intended) point – content spewing is clutter that creates noise which in turn makes relevance harder to filter. Timing couldn’t have been better with Jeremiah weighing in on what he sees as the big trends in social media.

Let me break this down – participation and interaction is key (as Fred Wilson and Mike Arrington point out). However Chis Saad, Alex van Elsas point out – it’s personal and about motivation of users. It’s about Relationships.

It’s about RELATIONSHIPS in context to the user ‘s behavior.

Web 1.0 – USER paradigm – self service was at the heart of the user experience

Web 2.0 – USER paradigm – everything remains the same except instead of self service (which is now a full blown user norm) it’s about relationships
1. search/browse
2. RELATIONSHIPS
3. information
4. action

RELATIONSHIPS are at the heart of the user experience.

Big Trend and Opportunity: the need for the creation of the key utilitiy for users around their relationships (the holy grail for advertisers and new startups). It will be in the form of new filters in the contextual and behaviorial area around relationships and information.

Just like in Web 1.0 it was in context to the web page and keywords in search. For Web 2.0 we will see a multidimensional approach to context and behavior centered around relationships – to content, people, data, ..etc.

At the end of the day the value to the user will be the same as Web 1.0 – getting information and taking action. However, instead of self service being the linchpin for context and behavioral value to users, a new linchpin will be based upon relationships.

Whoever makes the users value proposition of getting information and taking action faster, easiers, and simplier will win.