Archive for March, 2009

Tweeting or Twittering?

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Sunday, March 29th, 2009 digital No Comments

the problem with online metrics – it’s estimated, approximated, or extrapolated

TechCrunch based the following post on ComScore numbers, which shows “MySpace currently has 124 million monthly unique visitors, compared to Facebook’s 276 million” in Feb 2009.

http://www.techcrunch.com/2009/03/23/facebook-hockey-sticks-while-myspace-languishes/

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But checking Compete and QuantCast the numbers are not just slightly different, they are way different.

Compete:  Facebook 74M; MySpace 53M in Feb 2009

QuantCast: Facebook 79M; MySpace 66M in Feb 2009

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Given the huge discrepancy, the only thing that can really be concluded is that Facebook has overtaken and is larger than MySpace now and continuing to widen the lead.

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Tuesday, March 24th, 2009 digital No Comments

the overall advertising pie will shrink

the greater efficiencies of “digital” mean that the same amount of “advertising” can be achieved with fewer dollars because more waste can be eliminated. The decreases in ad spending in traditional media channels like newspapers will only be partially replaced by ad spending online.

For example, the dollars that used to fund newspaper classified advertising has been replaced by free online classifieds through Craigslist. While newspapers had incremental costs due to materials, printing, labor, and distribution, online classifieds have virtually no incremental cost.

Similarly print advertising, which was based on targeting ads to specific demographics of readerships are being replaced by online ads which can be more finely targeted to even more niche readerships — e.g. contextual advertising. And the revenue models based around cost per click are inherently more efficient (and thus lower cost) than the impression-based revenue models of magazines. Again for every dollar taken out of print advertising, only a few cents are needed to replace it in “digital.”

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Agree with me or tell me I’m stupid @acfou

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Sign of the times – “garage sale” sites all seeing increases in unique visitors

re: Craigslist More Popular Than MySpace : Sign of Economy Says Hitwise

http://www.searchenginejournal.com/craigslist-search-hitwise/9391/

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the comparison to MySpace is irrelevant for the conclusion; furthermore, the report uses search volume for the comparison and people search for “craigslist” and “myspace” for entirely different reasons. And MySpace continues to have 8X the unique visitors as Craigslist — so it is not that Craigslist is more “popular” than MySpace.

A sign of the times is that “garage sale” type sites are all seeing increases in traffic — e.g. Craigslist, OLX, Backpage, etc.

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Saturday, March 21st, 2009 digital No Comments

so, you think you’re viral? here’s how to find out…

1. post your “viral” video, banner ad, etc.
2. tweet about it
3. see if any one of your followers re-tweets it
4. check twitt(url)y to see “twitter intensity” around you asset

this is a quick way to tell if what you think is viral is viral. If even your own circle of followers don’t retweet it, it probably isn’t viral.  What you think is cool may actually not be that cool.  And sticking it on YouTube and supporting it with a lot of paid media, doesn’t make it viral!

Agree with me?  Or tell me I’m stupid @acfou

using twitter intensity to determine if something is viral (or not).

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Friday, March 20th, 2009 analytics, digital, marketing No Comments

no, twitter will NOT be the next google

Every year around SXSW, there’s a surge in interest about twitter. This time around people have even gone as far as to proclaim twitter to be “the next google” or “the future of search” etc.  Bullocks!

Here’s why:

1) distant from other social networks – While we are seeing a massive surge in interest and usage of twitter, it is still a long way off from the number of users of other social networks; it will take a long time to get to critical mass; and this is a prerequisite for twitter to assail the established habit of the majority of consumers to “google it.” — Google’s already a verb.

2) no business model – It remains to be seen whether Twitter can come up with a business model to survive for the long haul. Ads with search are proven. Ads on social networks are not. And given the 140-character limit, there’s hardly any space to add ads.

3) lead adopters’ perspective is skewed – Twitter is still mostly lead adopters and techies so far; so the perspectives on its potential may be skewed too positively. As more mainstream users start to use it, we’re likely to see more tweets about nose picking, waking up, making coffee, being bored, etc….  This will quickly make the collective mass of content far less specialized and useful (as it is now).

4) too few friends to matter – Most people have too few friends. Not everyone is a Scott Monty ( @scottmonty ) with nearly 15,000 followers. So while a user’s own circle of friends would be useful for real-time searches like “what restaurant should I go to right now?” the circle is too small to know everything about everything they want to search on. And even if you take it out to a few concentric circles from the original user who asked, that depends on people retweeting your question to their followers and ultimately someone notifying you when the network has arrived at an answer — not likely to happen.

5) topics only interesting to small circle of followers – Most topics tweeted are interesting to only a very small circle of followers, most likely not even to all the followers of a particular person. A great way to see this phenomenon is with twitt(url)y. It measures twitter intensity of a particular story and lists the most tweeted and retweeted stories.  Out of the millions of users and billions of tweets, the top most tweeted stories range in the 100 – 500 tweet range and recently these included March 18 – Apple’s iPhone OS 3.0 preview event; #skittles; and the shutdown of Denver’s Rocky Mountain News.  Most other tweets are simply not important enough to enough people for them to retweet.

6) single purpose apps or social networks go away when other sites come along with more functionality or when big players simply add their functionality to their suite of services.

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Am I missing something here, people?  Agree with me or tell me I’m stupid @acfou :-)

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Wednesday, March 18th, 2009 digital, social networks No Comments

the economics of advertising sucks, but it will suck a lot more soon

it’s a simple matter of supply and demand. Let’s do a thought exercise.

1.  eMarketer forecasts that retail e-commerce will grow roughly 10% per year for the next few years. This means that the total “pie” of people spending online will only grow by an average of 10% per year. Note that sales is (or should be) the goal of advertising. So that’s why we are looking at e-commerce sales and comparing it to online advertising because both are completed in the same medium and we can eliminate cross-media uncertainties and breakdown of tracking.

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2. online advertising is still exploding with trillions of pageviews per month, thanks to social networks which throw off ungodly numbers of pageviews when people socialize with others. The Compete chart below shows the top social networks which rely on banner advertising (impression-based advertising) to make revenues. Notice that just Facebook and Myspace alone generate 115 BILLION pageviews a month. And if you consider that Facebook shows 3 ads per page, that would be 250+ BILLION impressions per month served by Facebook alone. Furthermore, the rate at which pageviews grow is 250% – 1,000% per year, depending on the site in question.

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3. In the online medium, we have end-to-end tracking from the advertising (banner impression) through to the sale (e-commerce). The banner is served (impressions); a percent of users click on it to go to a site (click through rate – CTR); a percent of those make their way through the site and end up completing a purchase online (conversion rate). Those users who are looking for something and who are considering buying something will be online searching and researching. Those are the ones who are likely to click on banner ads, compared to others who are online to do something else, like write email, socialize with friends, etc.  And if the purchase is their ultimate end-goal (to make a purchase) we have a farily reliable indicator of the growth in not only such interest but also the completion of the task — namely, e-commerce, which grows at 10%.

4. Now, if the number of people who will click grows that 10%, but the number of advertising impressions grows at a slow 250%, the ratio of clicks to impressions drops dramatically because the denominator is growing 25X faster than the numerator. Serving more ads simply will not get the amount of e-commerce to grow significantly faster. The point of diminishing returns has been reached and passed, so incremental ad impressions are ignored and useless. The number of people who will end up buying will not increase significantly faster. And given the tough economic climate the amount of sales may actually decline before it goes up again.

5. If we generalize this back to all retail commerce, it grows at an EVEN slower pace than ecommerce. When you compare this to the dramatic increase in ad impressions and the shift from traditional channels (TV, print, radio – whose impressions and audience sizes are dwindling) to online channels (portals, news sites, social networks – whose impressions and audience sizes are skyrocketing) again the ratio of sales to available advertising drops dramatically. This is a measure of the effectiveness of advertising (sales  divided by advertising spend). It was already small — it sucked — and it will get dramatically smaller soon — it’ll suck more soon.

A way to mitigate this “sucking” is to peg advertising expenditures on a success metric which is an indicator of user intent — cost per click — versus a traditional indicator of reach and frequency — ad impressions served — which from the above is NOT an indicator of consumers’ intent to purchase.  This way, advertisers only pay when someone clicks. Those “someones” click when they are looking for something and are more likely to complete a purchase than those who don’t click.

“CPC banner advertising” anyone?

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Sunday, March 15th, 2009 digital No Comments

is your brand name a generic word?

if it is, it’s a LOT harder for users to find you

TAG – men’s personal care line from Proctor & Gamble – hard to pick out from other search results on “tag.” The brands have to use paid search ads to show up.

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serch engine optimization is critical, otherwise, looking at the following graphs, there is no way to tell when a brand launched or when they have campaigns in market, because the volume of search on the generic term is so great, the lift in search volume due to paid advertising is not detectable.

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Wednesday, March 11th, 2009 digital No Comments

in-banner commerce

reducing the number of clicks between the inspiration and the action (purchase) usually helps reduce the precipitous drop off of people not completing the desired end-action. in-banner commerce means you can sell the item right in the banner. The user may already be registered with Amazon.com and have their card on file. This can be 1-click purchase in the banner itself — to take advantage of impulse purchases. This works especially well for low cost and low consideration products.

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Tuesday, March 10th, 2009 digital No Comments

Will MySpace go the way of AOL? yes, it’s already happening

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Tuesday, March 10th, 2009 display advertising No Comments

Dr. Augustine Fou is Digital Consigliere to marketing executives, advising them on digital strategy and Unified Marketing(tm). Dr Fou has over 17 years of in-the-trenches, hands-on experience, which enables him to provide objective, in-depth assessments of their current marketing programs and recommendations for improving business impact and ROI using digital insights.

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