Sometimes It’s Just Semantics

from GigaOM by Stacey Higginbotham

As someone whose job involves understanding how certain people and things relate to one another, the idea of the semantic web is both compelling and scary. It could make my job that much easier, or it could make me as redundant as switchboard operators are today.

Coding information in a standard way so that machines can see how one person relates to another, or how a string of words could alternately be a movie or a book title, is a challenge. But plenty of companies are taking little bits and pieces of the problem and solving them. One such startup, Radar Networks, the maker of Twine, today received $13 million in funding from Velocity Capital, Vulcan Capital and DFJ. Other startups such as EVRI and Freebase have also benefited from VC interest in the semantic web.

Some of the companies are following the standards offered by the W3C, which is pushing RDF as a standard data structure to underlie the semantic web. But not all companies working on helping machines figure out the relationships and categories that most humans have learned use that standard.

Nor are all the companies interested in making the semantic web work startups. Yahoo uses RDF in some of its offerings and Google’s efforts with its social graph API initiative resembles the semantic web in its goals. Instead of using RDF, however, it’s using XFM and FOAF tags.

Reuters is another company that sees potential is getting machines to understand relationships. Earlier this month its CEO laid out a pretty compelling vision (at least to Tim O’Reilly) about how Reuters would rely less on delivering information and more on packaging its information in a way that could be used by analysts and computers to quickly delineate relationships.

Reuters would then be able to take its content, make it programmable and offer that data to users, who could then do with it what they will. Things like making relationship charts that currently can take a journalist and graphics department a couple of days to complete, and must then be monitored and changed manually, become easy.

The effort to render all of the data on the web into a semantic form will take a while. Nova Spivack, CEO of Radar Networks, believes that semantic web applications are currently in the early adopter phase. Twine will unveil its efforts in March through a private beta and another startup, AdaptiveBlue launched a semantic plug-in called Blue Organizer earlier this month. Spivack believes that in 2010 mass adoption will take place as people start to expect machines to make “intelligent” connections between people and things.

All of this is interesting, but putting a layer of semantic code over the existing web raises some concerns. One is the danger of inaccurate or at the very least less nuanced sense of relationships between people. Another is the everlasting nature of information on the web. How will coded tags be able to follow the intricacies of human relationships as fights ensue, jobs shift and even names change?

Another issue that we’ll have to deal with is confusion as people try to figure out what the semantic web really is. I’m thinking of it as code added to existing and new web content that helps determine and maybe track relationships between people and contexts for objects. I’m not married to the W3C standards, however, and others are doing this without using those particular programming tools.

There are also plenty of other definitions and hopes for the next phase of the web that may play out before we get an intelligent Internet. It’s already apparent that the web will continue to become more useful over time, but won’t ever replace the benefits of human interactions. If you doubt me, just recall your most fulfilling customer service call with a person compared with your most fulfilling experience with an automated agent. While both are helpful, sometimes you need a real, live human being.

Award Winning TV Spot

Last year the EPURON GmbH spot for wind energy use won best TV ad spot from Germany at the ad festival in Cannes. It was put together by Nordpol + Hamburg.

Microsoft Announces New Reporting Standard for Digital Campaign Performance: Engagement Mapping

New approach allows advertisers to map and assign value to various touch points, gaining a more complete picture of a campaign.

REDMOND, Wash. — Feb. 25, 2008 — Microsoft Corp. today announced Engagement Mapping, a new approach to managing and measuring the effectiveness of online campaigns that goes beyond the current “last ad clicked” standard. For the last decade, virtually all ad campaign reporting methodologies associate sales, leads and Web traffic simply to the last click or ad exposure. Engagement Mapping takes into account for the first time all the various online touchpoints and interactions a consumer experiences before an eventual sale.

Based on the Engagement Mapping concept, Microsoft announced the beta of Engagement ROI, an online campaign reporting and optimization solution that will undergo testing by national advertising clients and agencies, including Agência Click + UNICA, Best Western International Inc., BKV, Citi Cards, GSD&M Idea City, Ingenuity Media of The Martin Agency, Initiative, McKinney, MEC Interaction, Mindshare Interaction, Monster Worldwide Inc., Neo@Ogilvy, Sprint and World Vision. Engagement ROI evaluates and assigns measurable value to a consumer’s interaction with ads, giving advertisers and publishers a more complete picture of online behavior.

“The ‘last ad clicked’ is an outdated and flawed approach because it essentially ignores all prior interactions the consumer has with a marketer’s message,” said Brian McAndrews, senior vice president of the Advertiser & Publisher Solutions (APS) Division at Microsoft. “Our Engagement Mapping approach conveys how each ad exposure — whether display, rich media or search, seen multiple times on multiple sites and across many channels — influenced an eventual purchase. We believe it represents a quantum leap for advertisers and publishers who are seeking to maximize their online spends.”

Announcement of the Engagement ROI beta coincided with a keynote speech, “Advertising Ecosystem 2.0,” by McAndrews at the Interactive Advertising Bureau’s (IAB) Annual Meeting in Phoenix today.

The Engagement ROI is a fully integrated reporting capability within the Atlas Media Console currently available through Microsoft. Value is assigned and measured on a real-time basis and takes into account the impact that recency, frequency, size and ad format (such as rich media and video) have on a consumer’s online path to action. Engagement ROI is designed to allow advertisers and publishers to manage their campaigns with greater insight and control than previously available through third-party ad serving.

The beta officially begins on March 1, with results expected to be available before the end of the second calendar quarter.

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Microsoft Advertiser and Publisher Solutions (APS) provides world-class advertising platforms and tools for advertisers, agencies and publishers. Its mission is to make buying and selling media simpler, smarter and more cost-effective across media and devices in the Microsoft network of properties and beyond. The APS portfolio includes Microsoft adCenter, Atlas, DRIVEpm, Massive Inc. and ScreenTonic. APS businesses span search, display and emerging media including mobile, gaming, video on demand and IPTV. More information can be found at http://advertising.microsoft.com.

Massive Online Ad Network Funding: $80M+ for Adconion and Glam

February 25, 2008 — 07:39 AM PST — by Adam Ostrow —

Adconion Media Group has received a massive $80 million in Series C funding for its online advertising network. The funding round was led by Index Ventures with participation from Wellington Partners. The company is touting the news as “largest purely VC raise in history.”

Adconion is based in London and is most prominent internationally. According to stats the company publishes on its homepage, they serve approximately 290 million ad impressions per day, only about 50 million of which are in the US.

Separately, Glam Media, the woman-focused media company and ad network announced that it has raised a total of $84.6 million ($64.6 million Series D, $20 million debt financing). The funding was lead by media company Hubert Burda Media, with participation from GLG Partners, DAG, Accel Partners, Draper Fisher Jurvetson, Walden Ventures, and Information Capital.

Last year, we saw just about every major ad network get snapped up by the major Internet companies; DoubleClick to Google, aQuantive to Microsoft, RightMedia to Yahoo, and several others in the multi-hundred millions of dollars. It’s clear that VCs are confident the trend will continue, and as such, are investing heavily in the next generation of ad networks.

The Monetization of Ad Inventory

Written by Darren Herman - February 24, 2008

Roger raises an important issue when it comes to assessing company valuations and inventory: how much of it is monetizable? This is an extremely important question and often gets answered by the associate or general partner of a venture firm who is building the financial model for the startup they are looking at investing in or the M&A team who is looking to acquire an ad-supported startup.

One of the top concerns of mine and I’ve been through it first hand: when venture capitalists or corporate development teams are working through a financial model to figure out how much your inventory is worth, I can almost guarantee not one of them has ever spent any time in an ad agency (on the media team) or in marketing at a brand. I’d imagine over 90% of all VC’s or M&A folks come from finance, engineering, or similar backgrounds.

This is a problem (there is always a solution to any problem) when it comes to monetizing the web. We like to think that just because Facebook delivered over 12 billion pageviews in January 2008 (ComScore), they are able to monetize all 12 billion. Unfortunately, that is not and most often never the case. Case in point: Yahoo sells out the homepage of their site, but I know first hand that they have quite a bit of inventory that goes unsold on other areas of their network. Trying to buy a Yahoo! home page though is quite expensive and is sold out for weeks at a time.

There are a few important reasons (amongst many others) why any company who sells advertising on their website may have unsold inventory (startup, emerging company, or world renown):

1. Ad sales team is not effective. Tough to find, attract, and maintain a top-notch sales team in any industry.
2. Depending on the size of a company, a sales team can only cover so much geographical territory. For every territory not covered, money is being left on the table.
3. The ad marketplace (agencies and/or brands) may not want to purchase the inventory available for a host of different reasons.
4. The business environment is not conducive to ad spending at this time.

Most startups that I’ve had the chance to work with like to deploy a direct sales strategy first and sell all of the high-level integrations (longer sales cycle but more expensive buys) and then outsource standard inventory (IAB) to ad networks, rep companies, and participate on advertising exchanges.

With so many advertising supported (either fully or partially) startups in the market, the networks and exchanges are growing at an increasing rate. My guess is that the amount of inventory available to advertising networks is outpacing the additional advertising dollars available so the % of monetization of inventory is decreasing on a month-to-month basis. If there is a downturn in the economy, this will surely affect the sell thru and the % of monetization will decline rapidly.

Most of the purse strings of advertising budgets are held by ad agencies. Yes, ultimately, brands sign-off on any plans, but agencies are doing a lot of the work to make strategic and tactical recommendations as to where to spend the brands money.

There are many types of agencies who spend their money digitally:

1. Interactive (only) shop
2. Performance marketing (direct) shop that has a digital capacity
3. Fully integrated agency (digital, print, OOH, television, etc)
4. Others..

The way that each of these agencies looks at the digital environment may be very different from one another. A fully integrated agency may not be looking at performance driven marketing (CPA type stuff) whilst an Interactive shop may not want to amplify what the brand is doing offline into the online world. These are just examples and may or may not hold true for any and all of the agencies.

The bulk of the premium inventory on many websites are being sold to Interactive and Integrated agencies as they are the most creative and high-impact. Beyond this, agencies may purchase inventory from ad networks to add reach (or hit certain goals) and in some (increasing) cases, ad exchanges, though compared to the larger pie, small [today].

Just because you have 12 billion page views, should you be worth $XXCPM * 12 billion/1000 * XX months? (or whatever the valuation equation is?) I’d also like to see some marketing gurus head into the finance world, that way, we can add some context to the valuations occurring today. The majority of sites will not monetize 100% of their traffic 100% of the time. Please remember to keep this in mind.

One other thing to keep in mind:

1. Not all agencies pay the same rate
2. Rates are different depending upon the category vertical, time of year, etc.
3. Most major buying firms are paying well below rate card

Google Master Plan

4 widget best practices

By Nikole Brake

If you're launching a widget campaign, consider these strategic and technical factors to maximize your campaign's impact.

The intense popularity of widgets, gadgets, Facebook applications and their kin has advertisers and publishers eager to get on board. But before you invest in a widgetized advertising campaign, there are a number of strategic and technical factors to consider. There are also important guidelines to follow to ensure you get the most from your investment.

Are you ready to let go?
That's the first question to ask yourself, because consumers interact with widgets (and thus your content) outside the confines of your website. That off-site engagement may run counter to your online marketing instincts.

But by their very nature, widgets keep users interested in your message, which is likely to drive pageviews back to your site. A desktop widget is an ever-present reminder of your brand -- like the promotional mousepads you once gave away, only much more effective and minus the coffee stains.

Beyond a willingness to give consumers a long leash, you must also be ready to put some effort into keeping your widget evergreen. Refreshes should occur in real-time, or at least daily. And your content has to be interesting and relevant over an indefinite period of time. It's not a medium for lazy advertisers; however, it is a new canvas for the truly creative.

If you're ready to both liberate your content and invest some energy in your widget, it's a channel worth exploring. Once you decide to move forward, here are a few tips to keep in mind.

Serve a purpose, and serve it fresh
Widgets shouldn't simply be advertisements for your content or service. Think of them instead as a service or tool unto themselves - something that keeps users engaged with your message because it delivers value in some way. Especially when it provides real-time, practical information, consumers will refer to your widget again and again.

A classic example that meets these criteria is a branded traffic widget updated in real time. Because it's both useful and current, users may well interact with it several times each day -- during the AM and PM commutes, for example. That's at least two times per day that your brand is on your customer's mind -- a level of awareness that's hard to beat.

Stick with standards and partners you know
On the development side, adhering to IAB standards maximizes the number of potential placements for your widget. It's also wise to stay within "general" publisher restrictions for file sizes.

If you're sourcing third-party content such as RSS feeds or APIs for Mashups, work with a partner you trust absolutely. Any problems with widget security or reliability can sting your users and compromise your brand image.

The good news is that your first foray into the widget market needn't involve developing a widget from scratch. Often, you can simply repurpose popular information or features from your existing website. Innovative search features, shopping recommendation tools or special-interest news, for example, can all be widgetized by reducing file sizes, increasing interactivity and possibly adding a social or creative spin.

The point is, if consumers like information or features on your site, they may love the convenience of a widgetized version.

The distribution question
Once you've created your widget, how do you get it to fly? The first step is to find a syndication partner. Syndicators provide the "wrapper" or components necessary for your widget to be picked up on blogs, social networks, and personal pages. YourMinis from Goowy Media (now part of AOL), Clearspring Technologies and Interpolls are just three examples of established syndicators. Once you have a syndication partner, you can place your widget in popular galleries such as Yahoo's Widgets, Facebook, the Mac Dashboard or Widgetbox. Of course, be sure to showcase your widgets on your own site, and consider working with a widget ad network.

Given the popularity and the ingenuity devoted to these mini-applications, widget-based advertising will continue to grow and evolve -- enabling creative forward-thinking advertisers and publishers to build a totally new kind of customer relationship.