Twitter Groups: "TwittGroups.com
Who said that Twitter needs to have Groups?
Now you can create your own Group tag and invite your friends on Twitter to join you. Expand your Twitter experience by sharing links and allowing other to follow you and join your group.
Create a new Group or Join an existing group. Follow people with the same interests as you. Find new people to follow. Let people follow you. Share your favorite website links.
Create and promote your own groups... It is that simple...
Create A Twitter Group
Join A Twitter Group"
Tuesday, December 9, 2008
Monday, December 8, 2008
Ad-Spending Forecasts Are Glum
Estimates Vary, but Economic Crisis Is Expected to Spur Cuts in U.S., Abroad
By EMILY STEEL
For the advertising and media industries, the worst is yet to come, according to some of Madison Avenue's most closely watched forecasts.
Fallout from the global financial crisis will bring cuts in total ad spending next year both in the U.S. and abroad, though predictions vary widely. Publicis Groupe media agency ZenithOptimedia expects U.S. ad spending to drop 6.2% in 2009 to $161.8 billion. WPP's agency GroupM sees a decline of 3% to $157 billion.
Continued growth in emerging markets will help offset declines in North America and Western Europe, according to both firms, which predict that global ad spending will decline by 0.2% in 2009.
Both companies plan to present their forecasts Monday morning at the UBS Global Media and Communications Conference in New York. Their predictions have been keenly anticipated as industry observers seek signs of how severe an impact the economic downturn will have on the ad business.
Another high-profile forecaster, Robert J. Coen, senior vice president and director of forecasting at Interpublic Group's Magna, also plans to present his predictions at the conference Monday. IPG declined to release its forecasts ahead of time.
Forecasts from Zenith and GroupM represent differing views on ad spending in 2008. Zenith says the current ad spending downturn started in the third quarter and has accelerated through the end of the year, with U.S. ad spending down 3.8% in 2008 to $172.5 billion. Group M is predicting that U.S. ad spending increased 0.3% this year to $162 billion.
In addition to weakness in spending from automotive and financial advertisers, GroupM predicts that retailers will be under pressure following the critical holiday sales season. It says that while it has yet to see wholesale cancellations among its clients, advertisers are now watching every penny.
Spending cuts probably will be most severe for newspapers, magazines and radio as advertisers shift dollars to digital media. One bright spot continues to be Internet, which will keep on growing, albeit not as quickly as in recent years. Online ad spending is expected to increase 5% in 2009, down from 16% growth in 2008, according to GroupM. TV spending also should fare relatively well in the downturn. Advertisers are familiar with using that model to build brands, and TV viewing tends to rise in recessions because TV is a low-cost entertainment option, according to Zenith.
Still, these forecasts paint rosier pictures than recent predictions from Wall Street analysts, which also are split.
Just last week, Fitch Ratings cautioned that U.S. ad spending next year would drop between 6% and 9%, in line with the steep downturn experienced in 2001 following the bursting of the dot-com bubble and the Sept. 11 terrorist attacks. That year was the worst ad recession since 1970.
Fitch predicts that the current downturn will extend well into 2010, probably causing broad pullbacks in both the national and the local markets, pressure across a wide spectrum of advertising categories including retail, auto and financial services, and a glut of ad space thanks to the Web and other emerging media.
UBS is forecasting that U.S. ad spending will fall 6% in 2009 but doesn't anticipate the ad spending decline will be as steep as in 2001.
Friday, December 5, 2008
Social Networkers Aren’t There for Ads
DECEMBER 5, 2008
Users want to communicate with each other, not necessarily with brands.
Monetizing social networks was challenging enough before the economic news got so gloomy—it will get even harder now. That’s because the huge traffic numbers at MySpace, Facebook, Bebo and the rest do not necessarily translate into ad dollars.
More than one-half of the US population surveyed uses social networking sites, according to IDC, but the ad dollars have not followed. The research company found more than 75% of social network site users logged in at least once a week and 57% did so daily. IDC also said more than 61% of those users spent more than 30 minutes per session on social network sites, and 38% remained parked for 1 hour or more.
Good news for marketers, right? Not necessarily. Only 57% of social network site users said they clicked on an ad in the past year, compared with 79% of all Internet consumers.
Barak Rabinowitz, co-founder of Amuso, a site that invites users to create and participate in entertainment contests and game shows, described the challenge of monetizing social networks as the “elephant in the room” of online advertising. Writing in VentureBeat, Mr. Rabinowitz said: “[It’s] 400 million social networkers creating and consuming content, clustering around shared interests and activities—all who have yet to be tapped in any major way by Web marketers.
“Search continues to be the most lucrative advertising strategy. Users are specifically seeking information in that arena. On social networks, people are primarily concerned with communicating with their friends, not looking to buy items or services.”
Despite phenomenal growth, social networks have yet to reach online advertising nirvana—that heady place where behavioral targeting tools aim for specific groups with offers specially tailored to members’ interests. It’s a place where marketers are able to serve ads, promotions and offers to friends of friends based on a pal’s recommendation, and where word-of-mouth marketing spreads like a flu virus in January to create waves of self-selecting consumers eager to interact with marketers.
However, IDC found just 3% of users polled said it was appropriate for publishers to use their data (contact information and the like) for advertising. The report referred to ad targeting on social networks as a “stillborn” idea.
Given the tepid situation for advertising on social networks, coupled with the deepening recession, what is the prognosis?
In May 2008, eMarketer projected advertisers would spend $1.4 billion to place ads on online social networks this year. eMarketer also forecast ad spending on social networks would reach $2.4 billion in 2011.
With the country in recession and online ad spending growth slowing, social network ad spending will be affected even more heavily. eMarketer will issue a new US social network ad spending forecast later this month.
Wednesday, December 3, 2008
Not ye olde banners
Nov 27th 2008 | SAN FRANCISCO
From The Economist print edition
From The Economist print edition
Internet advertising will be relatively unscathed in the downturn
| |
 | |
AT THE beginning of the year Jeff Zucker, the boss of NBC Universal, a big television and film company, told an audience of TV executives that their biggest challenge was to ensure “that we do not end up trading analogue dollars for digital pennies”. He meant that audiences were moving online faster than advertisers, thus leaving media companies short-changed. Now, near the end of the year, the situation looks even worse, as the recession threatens to turn even the analogue dollars into pennies. Will this hasten the shift towards internet advertising, or will it decline too?
Advertising rises and falls with the economy, though how much is a matter of debate. Randall Rothenberg, the boss of the Interactive Advertising Bureau, a trade association for digital advertisers, points to the remarkable stability of advertising at about 2% of GDP since 1919, when the data began to be collected. This would suggest that ad budgets will move roughly in line with economic output.
But Mary Meeker, an internet analyst at Morgan Stanley, believes that modern ad budgets rise and fall much more than GDP does. According to her estimates, if the economy stops growing, ad spending is likely to fall by 4%. If the economy shrinks by 2%, overall ad spending may fall by 10%. As for the online segment, recent history is cause for pessimism. Between 2000 and 2002, during the dotcom recession, online ad spending in America fell by 27%.
Yet the web has changed a lot since 2002. Back then, gaudy display “banners” on web portals such as Yahoo! and MSN were the preferred technology. These still exist, but they now account for less than 20% of online ad spending. More than half goes to search advertising on Google and rival search-engines, which place small text ads next to results based on the keyword of the query, and charge only when a user clicks on them. In brand advertising, “rich media” ads are taking over from banners. These allow users to interact by clicking, so their engagement can be tracked.
All this makes spending on advertising much less speculative, so that it starts to be treated instead as a cost of sales. This is one reason why online advertising should suffer less than other sorts. This week eMarketer, a market-research firm, predicted that online-advertising spending in America, which makes up about half the global total, will increase by 8.9% in 2009, rather than the 14.5% it had forecast in August. The firm thinks search advertising will grow by 14.9% and rich-media ads by 7.5%, whereas display ads will grow by 6.6%. In short, online advertising will continue to expand in the recession—just not as quickly as previously expected.
Another reason for optimism, says Mr Rothenberg, is that online advertising is making obsolete the old distinction between marketing spending “above the line” and “below” it. In the jargon, above-the-line spending drives brand “awareness” (probably on television) or “consideration” by a consumer planning a purchase (probably in a newspaper). Such spending is often slashed in recessions. Below-the-line spending includes promotions or coupons to whet the consumer’s “preference” for the brand as he nears a purchase, or schemes such as frequent- flyer miles to increase his “loyalty” afterwards. These budgets are more robust.
Online marketing increasingly aims for awareness, consideration, preference and loyalty all at once. Mr Rothenberg gives the example of a rich-media ad for Kraft, a food company, in which a yummy image raises brand awareness, a click reveals a recipe that increases consideration, another click provides coupons and yet another click initiates a game that can be shared with friends. Marketing managers can therefore defend their online budgets as being both above and below the line.
The industry is also cautiously excited about two new forms of online advertising. The first is video. So far nobody has found a way to advertise inside online clips on a large scale. YouTube, which Google bought for no less than $1.65 billion two years ago, is “a huge end-user success,” says Eric Schmidt, Google’s boss, “and we’re awaiting the monetisation.” This is his way of saying that YouTube, despite showing 5 billion video clips a month, has trivial ad revenues. The site is experimenting with text “overlays” inside clips and sponsored videos for specific search terms, but it is early days. “If only we could schedule the revolution,” jokes Larry Page, one of Google’s founders.
 | |
If something close to one is in fact near, it may not come from YouTube. Ads on Hulu, a video site that is a joint venture between Mr Zucker’s NBC Universal and News Corp, another media giant, appear to be selling well. Hulu is different from other video sites in that it only shows professionally produced videos, such as programmes and films from NBC, Fox, MGM and Warner Brothers. It runs a relatively small number of short, fun “pre-roll” ads. These incorporate some of the advantages of the web. Viewers can, for instance, vote on how good a particular ad was.
The lesson appears to be that the problem was not the format but the fact that so much of the footage online, especially on YouTube, is “user-generated”. Brands are wary of putting their ads next to amateur clips because they may be boring or offensive. This is less likely to be a problem with professional content. From a small base, says Mr Rothenberg, online-video ads grew from 1% to 3% of all interactive ads in America in the first half of the year.
The other hope is for ads on social networks such as MySpace and Facebook. They are experimenting with a variety of advertising formats, though none has yet proved very successful. Their big weakness is that users go to social-networking sites to socialise, not to shop (as they might on search engines). Their biggest strength is that users spend so much time there. Two years ago 11% of time spent online was at Yahoo! and MSN, two web portals; now their share is down to 5%, and 5% of online time is spent at YouTube and Facebook.
Online traffic, in other words, is moving towards sites where advertising has so far proved ineffective and is therefore cheap. This, says Ms Meeker, presents an opportunity for innovation and arbitrage by clever marketing managers as they cut their conventional ad budgets. It may also provide a glimmer of hope for the advertising industry as it enters recession.
Web Marketing That Hopes to Learn What Attracts a Click
ONLINE advertisers are not lacking in choices: They can display their ads in any color, on any site, with any message, to any audience, with any image.
Now, a new breed of companies is trying to tackle all of those options and determine what ad works for a specific audience. They are creating hundreds of versions of clients’ online ads, changing elements like color, type font, message, and image to see what combination draws clicks on a particular site or from a specific audience.
It is technology that could cause a shift in the advertising world. The creators and designers of ads have long believed that a clever idea or emotional resonance drives an ad’s success. But that argument may be difficult to make when analysis suggests that it is not an ad’s brilliant tagline but its pale-yellow background and sans serif font that attracts customers.
The question is, “how do we combine creative energy, which is a manual and sort of qualitative exercise, with the raw processing power of computing, which is all about quantitative data?” said Tim Hanlon, executive vice president of VivaKi Ventures, the investment unit of Publicis Groupe.
“I think it’s clear that the traditional process of agencies is clearly not going to survive the digital era without significant changes to our approaches,” Mr. Hanlon said.
•
The push to automate the creative elements of ad units is coming from two companies in California, not Madison Avenue.
Adisn, based in Long Beach, and Tumri, based in Mountain View, are working both sides of the ad equation. On one, they are trying to figure out who is looking at a page by using a mix of behavioral targeting and analysis of the page’s content. On the other side, they are assembling an ad on the fly that is meant to appeal to that person.
Both companies assume there is no perfect version of an ad, and instead assemble hundreds of different versions that are displayed on Web sites where their clients have bought ad space, showing versions of an ad to actual consumers as they browse the Web.
That might lead to finding that an ad for a baby supply store is more popular with young mothers when it features a bottle instead of diapers.
(Adisn and Tumri both measure the ad’s effectiveness based on parameters the advertiser sets, like how many people clicked on the ad or how many people actually bought something after clicking on it. They compare those with standard ads they run as part of a control group.)
Adisn’s approach has been to build a database of related words so it can assess the content of a Web site or blog based on the words on its pages.
Adisn then buys space on Web sites, and uses its information to find an appropriate ad to show visitors to those sites. If a visitor views pages about beaches, weather and Hawaii, it might suggest that the visitor is interested in Hawaiian travel.
Based on that analysis, Adisn’s system pulls different components — actors, fonts, background images — to make an ad. For example, it might show an ad with a blue background, an image of a beach, and a text about tickets to Hawaii. “Once we’ve built this huge database of hundreds of millions of relationships” between words, said Andy Moeck, the chief executive of Adisn, the system can “make a very good real-time decision as to what is the most relevant or appropriate campaign we could show.”
Simple Green, the cleaning brand, began working with Adisn this year to advertise a new line of products called Simple Green Naturals.
“If it’s a woman looking at a kitchen with a stainless steel refrigerator, they can show a stainless steel product,” said Jessica Frandson, the vice president for marketing for Simple Green. While Ms. Frandson gave Adisn a general idea of what she wanted, she also let the agency do almost random combinations with about 10 percent of her ads to see which of those combinations had the highest click-through rates.
“If it wants to be purple and orange, if that’s going to be appealing to my customer, then so be it,” she said.
Even Mr. Moeck said he was often surprised by the success of certain ads. “Some of it, I just scratch my head and say, ‘I have no idea,’ ” he said.
Tumri’s approach is slightly different. It creates a template for ads, including slots for the message, the color, the image and other elements.
Unlike Adisn, it does not buy ad space, but lets clients — like Sears and Best Buy — choose and buy space on sites themselves. And rather than building a contextual database like Adisn, Tumri uses whatever targeting approach advertisers are already using, whether it is behavioral or contextual or demographic, and assembles an ad on the fly based on that information.
“It’s reporting back to the advertiser and agency saying, ‘Guess what? The soccer mom in Indiana likes background three, which was pink, likes image four, which was the S.U.V., and likes marketing message 12, about room, safety and comfort,” said Calvin Lui, chief of Tumri.
•
Some advertisers are using that information just to see which version of the ad works best, but Mr. Lui emphasized that the appropriate ad is not static, and changes all the time as content on the page changes.
While the planners and buyers in advertising agencies are intrigued by the idea of measuring each part of an ad, the creative staff that designs ads is less focused on measurement and more focused on the overall effect.
“I think the creative community has to get very comfortable with results-based outcomes in marketing,” said Mr. Hanlon, whose company has an interest in Tumri. “There are a lot of creative people who didn’t sign up for that kind of world.”
Bant Breen, the president of worldwide digital communications at Initiative, the Interpublic Group media buying and planning firm, had a similar view. “The traditional creative process right now is not structured to essentially deliver hundreds of permutations, or hundreds of ideas for messaging,” said Mr. Breen, whose firm is using Tumri to determine which ads are working.
“There’s no doubt that there will be a lot of data that can be collected that could be applied to the creative process.”
But, he said, “that’s not necessarily an easy discussion to have with great art directors.”Monday, December 1, 2008
Widgets Are Made for Marketing, So Why Aren't More Advertisers Using Them?
Bob Garfield Examines a Tool That Is Cheap, Easy and a Great Expression of the Post-Advertising Age
Some guy lives in Albuquerque, which is great, because it is sunny and really convenient to Vista Encantada and Hoffmantown. But he has relatives in Denver, a limited budget, a lot of outstanding family obligations and a seven-hour, 450-mile gulf between them. Then, one hot and dry Thursday, he's sitting at a computer, and it goes ... "DING!"An icon on his desktop has some breaking news: a special Albuquerque-Denver fare on Southwest Airlines for $49 each way. It sends him that alert because he's asked for it, by downloading the Southwest "Ding" widget. Most of the time it just sits there, apparently idle, a tiny Southwest logo on a tiny Southwest tail section reminding him, at some extremely low level of consciousness, that Southwest exists.
| BACKCOUNTRY.COM |
 |
| Widget: Steep and Cheap How It Works: Advises users of special deals -- mainly loss leaders -- that draw them into the online shopping experience. Agency: In-house |
"After the first year, we hit the 2 million mark for downloads," says Paul Sacco, senior manager for online strategy and development at Southwest Airlines. "And it's still performing." In the third quarter of 2008, Ding generated 10 million clicks.
Wanna get away ... from the Old Model? Look no further than widgets, the mini software applications downloadable to browsers, desktops, social-networking pages, home pages and mobile phones. The widget may not be the holy grail, but it's arguably pretty damn grail-ish -- maybe the highest expression so far of online marketing in the Post-Advertising Age. And though it is very much on the cutting edge of Web 2.0, it is based on the hoariest of principles. In fact, to be properly visionary on this subject, you must begin by looking way back to the future.
For the past half-century (and for about five more minutes) TV advertising has been at the apex of marketing communications. Then, in no particular order, newspapers, magazines, radio, out of home, direct mail, point of purchase, collateral (brochures, for example) and -- in the murky, mucky darkness at the very bottom of the deepest abyss of marketing prestige -- advertising specialties.
For example, a ballpoint pen emblazoned with your insurance agent's logo. Or a wall calendar, fridge magnet, coffee mug, yardstick, foam beer-can sleeve, ashtray, key fob, emery board, pocket diary -- any cheap giveaway item meant to remind the consumer of you every single time she measures fabric or swigs a Pabst or files her nails.
Not that the 30-second spot represents high culture, exactly, but it's hard for mere words to convey how déclassé the advertising-specialty niche is. Still, I'll try: What funnel cakes are to cuisine, free fly swatters are to marketing. In a digital world, advertising specialties are as analog as you can possibly get.
Until they go digital. Branded widgets are the refrigerator magnets of the Brave New World. These compact, portable little software apps -- from video players to countdown clocks to makeup simulators -- are inexpensive to distribute, free to the user and (often enough) distinctly useful. At a minimum, they carry an ad message wherever they go.
That's at a minimum. At a maximum, the widget is something like the magical connection between marketers and consumers, not only replacing the one-way messaging long dominated by media advertising but vastly outperforming it. Because online the link is literal and direct, and along its path, data of behavior, preference and intention are left at every step. Oh, and your target consumers actually go out searching for your branded gimcrack. Oh, and they display it within easy reach. Oh, and they pass copies along to their friends and associates. Oh, and because they've been turned on by a friend, they are hospitable and receptive recipients. And, oh, in case this didn't quite register the first time I mentioned it, the barriers to entry are preposterously low. "The money is a joke," says Hillel Cooperman, ex-Microsoft big shot and founder of small Seattle software-development shop Jackson Fish Market. "It's a rounding error in the marketing business."
Ditto that, says Michael Lazerow, CEO of branded-application house Buddy Media, New York, especially when it comes to the cost of advertising (or, as he calls it, "app-vertising") the widget itself. "It is so cheap. This is the steal of the century."
That's because 500 million social-network users, each generating 1,200 page views per month, represent 600 billion monthly opportunities for an ad impression. Hence, almost everything is a remnant, and "you can buy inventory for basically nothing," he says.
Of course, that invites online marketers to embrace another throwback concept: an endless fusillade of mass messaging with no distinct target -- which is pretty much what digital marketing was supposed to be the solution for, wasn't it? But more on the economics of widgetry to follow. For the moment, let's look at some examples that demonstrate why, at least for the time being, it represents the very apotheosis of digital marketing. As my pal Jessica Greenwood of London's Contagious magazine sums up, the widget's value is "like a basic unit of utility. The marketing becomes part of the product."
- None more so than Miles, a 3-D desktop avatar that looks like a refugee from "Teletubbies" but resides on your desktop to encourage (i.e., nag) you to run, and keeps track of your progress via the astonishing Nike Plus technology. He also keeps you apprised of local weather, running events, promotions. And he organizes your RSS feeds, so you can easily download to your iPod. From Tribal DDB.
- UPS Widget. This guy looks like Miles' tan cousin. He allows you to schedule and track shipments worldwide with a click or two. If you are any sort of frequent shipper, why wouldn't you install him on your desktop? From McCann, London, and Skinkers.
- CokeTags is a Facebook app that displays your favorite links, allowing you to itemize your online self -- and keep track of who is following the trail of self you blaze. From the Advance Guard and Linkstorm.
- Steep and Cheap is an alert mechanism from the Backcountry.com catalog that advises users of special deals -- mainly loss leaders -- that draw them into the online-shopping experience. It's essentially like the Southwest Ding and works because the audience is as much a social network of the outdoorsy as a list of gear customers. In-house.
- InStyle's Hollywood Hair Makeover allows users to lift the coiffures of Jennifer Aniston, Cameron Diaz, et al. and superimpose them on their own photos -- for fun and/or to show a stylist. A superficiality bull's-eye! From Buddy Media.
- So you're in Singapore, old enough to drink in bars and young enough for that to be a lifestyle. Download Johnnie Walker's Jennie widget, and there is a totally cute avatar that guides you to the coolest saloon events and then, if you're half in the bag, safely home. From OgilvyOne.
Kind of hard to imagine users installing and using these ingenious apps and not appreciating the sponsor every single time -- a concept that for, say, a banner ad is even more unimaginable. As high-tech entrepreneur and former digital-marketing analyst Peter Kim puts it, "When you can combine utility with the purpose of your brand, that's the opposite of why people hate marketing. Instead of fooling them with the old brand-marketing song and dance, it's not a promise; it's a reality: 'This is what the traffic is like.
| NIKE |
 |
| Widget: Miles, a desktop avatar How It Works: Encourages you to run; keeps track of your progress via Nike Plus technology. He also keeps you apprised of local weather, running events and promotions. Agency: Tribal DDB |
Yeah, I'm grateful to John's Hardware when I kill insects dead, dead, dead with my free fly swatter, and I'm grateful to Johnnie Walker when it helps me find the best Singapore bar and my stumbling way back to my bed, bed, bed. That's the kind of dynamic that gets folks excited, folks such as Newsweek and GigaOm's Om Malik, who each declared 2007 "the year of the widget." And why? Because the marketer essentially gets to set up shop where you live, work and play.
"Inside the destination and the context people are already engaged in," says Niall Kennedy, founder of consultancy Hat Trick Media and host a month ago of the third-annual Widget Summit in San Francisco. "I liken this to a small Cincinnati retailer setting up shop in all the cities of the world instead of waiting for people to come to visit Cincinnati."
Yet in 2008 the entire segment will amount to something like $100 million. That's not nothing, but even in the midst of economic implosion, it's a sum even an endangered species such as NBC Universal can shake out of the sofa cushions -- which drives software developer Hillel Cooperman right up the wall. As he ventures out to AdTech and other prominent forums about marketing's future, he is confounded by his inability to capture advertisers' attention. Even as they bemoan the continuing collapse of traditional media and worry aloud about where to spend their money, he says, it's as if he's invisible. "And I'm jumping up and down. 'Hellooooo! Over here!'" he says, the frustration ringing in his voice. "All the stars are aligning. Everybody around me says, 'You're in the right place at the right time.' Yet it's still like pulling teeth."
Hmm. Magical connection. Pulling teeth. Those two images are hard to reconcile, but let's do try. There are plenty of reasons marketers have been slow to exploit the possibilities -- and why, no matter how grail-ish it can be, the widget's place in even a fully digital marketing economy may have a relatively low upper limit.
"The whole concept of a widget is just misstated or overblown," says Ben Kunz, director of strategic planning for Mediassociates, a media-planning firm. "It's not the channel; it's what you do with it that's important."
Kunz actually likes widgets a great deal; he's just queasy to hear them oversold, given what he says are their inherent limitations -- not the least of which is the difference between engaging with a piece of software and engaging with the sponsoring brand. "There's a lot of hyperbole out there about engagement," he says.
| SOUTHWEST AIRLINES |
 |
| Widget: Ding How It Works: Park it on your desktop, tell Southwest Airlines the prices and destinations you're looking for and it will update you on the latest deals from Southwest. Agency: GSD&M |
Even if the answer is yes, there are plenty of other issues to consider.
- Nonstandardization. There are lots of incompatible platforms: desktop, iGoogle, mobile, Facebook, MySpace, etc. Pending software-code universality, you must create a half-dozen or more versions of every widget.
- Dubious relevance to low-interest categories. What makes perfect sense for Johnnie Walker and Nike may not necessarily apply to Charmin.
- Cost. While, as Cooperman correctly observes, the cost of creating a widget is enticingly small, and the cost of distributing one is low compared with media advertising, the price tag is also typically open-ended. Marketers can be socked with fees up to $5 every time some Courtney or Madison embeds a widget on her MySpace page. So if you get lucky, you could also get unlucky. "Open-ended" is hard to budget for.
- Scale. There is only so much space on a desktop or a Facebook page or a mobile-phone screen. As Kunz observes, "Sure, you can give them utility, but there are only so many slots for that utility. In my world, there may be 100 things that I use a computer for. So conceivably you can create a widget for each one of those things, but you've limited the inventory." That means the vast majority of marketers are shut out the vast majority of the time.
"It's a campaign model," says Liza Hausman, VP-marketing for Gigya, the largest widget-distribution agency. "Advertisers are still going to have to move the needle in a particular time frame. There are people who are looking at widgets as customer relations management or long-term dialogues. That's not where we focus."
| SCHICK QUATTRO |
 |
| Widget: Trim Flixx How It Works: Upload your face onto a hunky guy's body and pillow fight with barely legal teens. We're not sure why. |
"That is a one-to-one relationship," Hausman says. "That widget is seen only by the person who put it there. Those widgets help you get through the day: news, weather, info," compared with social-network-page widgets that reside "where people are putting a public face on their world. And the widget there has a 1-to-many, many exposure."
That argument would seem to be backed up by data. A study by online-market-research firm Marketing Evolution found that return on investment from widgets increases in approximately direct proportion to virulence. The study, of campaigns from Adidas and video-game publisher Electronic Arts within MySpace, found that 70% of the ROI was attributable to consumer-to-consumer proliferation. The consulting firm calls this the "momentum effect," and clearly the momentum is a function of the kind of sharing that, say, the Southwest Ding doesn't much enjoy.
"I have no vested interest," says Marketing Evolution CEO Rex Briggs. "But I do tend to lean that way, mainly because we know there are decay curves to advertising. Keeping it novel and fresh generates a larger response. Part of it is the ability and desire to pass along what you're saying. Something new makes it newsworthy, worthy of passing it along to others, and there's value to that."
On the other hand, companies such as Gigya absolutely do have a vested interest and a structural bias against the enduring-utility model: Duration militates against repeat business. If a client successfully lands a widget on a zillion desktops or social-networking pages, and it stays there, the client has far less incentive to commission subsequent efforts, which, obviously, is bad news for the software designers and distributors. Furthermore, the problem with entertainment widgets such as games is the same one that afflicts any form of viral marketing: Virulence is hard to achieve. No matter how many Courtneys are out there, it's really hard to be the Next Big Thing that, however briefly, captures their imaginations. As Cooperman puts it, "Games are just like music and movies and books. It's a hit-driven business. I think it's fair to say nobody knows how to make a hit in any of those industries."
| JOHNNIE WALKER |
 |
| Widget: Jennie, a cute avatar How It Works:If you're in a strange land and looking for a drink, Jennie will guide you to the bar and back to your hotel. Agency: OgilvyOne |
And it really, really works! Logs data like a website, enables direct commerce like a website and becomes a destination like a website, only without the user having to leave the virtual house. She merely goes to the cupboard and opens up a can. For free, of course. Because Website-in-a-Can is so cheap to produce, folks can just give it away.
Buddy Media, one of the biggest creators of branded apps, fills two floors of a slightly skeezy office building on Broadway just above Columbus Circle. It used to be a Fred Astaire Dance Studio, with a ground-level Indian restaurant and water seeping down the bare-brick walls after every rain. Now it's a code factory, where workers load raw zeroes and ones into their Macs and forge software parts -- parts that are in turn assembled in various combinations to form custom applications. Using that small inventory of a few hundred in-stock parts, Buddy Media can turn out widgets fast and cheap.
"If you're going to do a 728-by-90 banner ad," says CEO Lazerow, "you might as well do an app. Because it's going to take the same amount of time and cost." What he doesn't advise is buying for reach and frequency. His buzz term is "reach and engagement," the idea of cultivating a few people instead of pestering a lot more. "Instead of reaching 80 million people, let's reach a million in your target and spend 10 minutes with them." Buddy Media has no difficulty establishing the engagement part. Its hairdo widget for InStyle magazine had more than 300,000 installs, 185,000 in the first six weeks. The average time spent on each visit was seven minutes -- three hairstyles' worth -- and nearly half of the users returned to it more than 25 times. "They basically cost less than traditional banners, and you get 75 times greater time spent than with regular banners and five times more time spent than with TV ads."
One believer among his clients is Keith S. Levy, VP-marketing for Anheuser-Busch, which created a Bud Light Dude Test widget to leverage [Note to readers: I have just used the word "leverage" as a verb. This will never happen again.] a Bud Light ad called "Dude."
"The multiplier effect of the web is extremely powerful," Levy says. Though the 300,000 downloads are laughable compared with a TV buy, "you're really getting a relationship with the consumer." Another widget, created just for the lucky winners of the Bud Light Party Cruise promotion, for instance, established an ongoing community of 4,000-some evangelists such as rowyco, who (according to his MySpace page) is a 24-year-old Arizonan whose nickname is an obscene acronym, whose slogan is "Hardcore for Life," who likes country and metal and tricked-out motorcycles, and who is working on a business degree at Paradise Valley Community College. His friends are Judith, Diana, Courtney (!), Crazy Christene, Justin, The Rouch and -- right at the top of the list -- Bud Light Party Cruise.
Compare this effort, for instance, with Bud TV, which at a cost of $15 million for the first two years alone, attempted to create a content destination more or less paralleling the tube. What Anheuser-Busch earned for its trouble was a squizzillion views of the hilarious commercial "Swear Jar," the enduring enmity of many state attorneys general, and zero MySpace friends. One day in late November, Bud TV's global web ranking, according to the online-analytics site Alexa, was 26,253,061. To put that in perspective, moisttowelettemuseum.com was ranked 5,681,20947. As they say over at A-B, lessons were learned. Though he won't characterize Bud TV as a boondoggle, when pressed to look at the relative efficiency of Bud TV and pocket-change widgetry, Levy offers, "Did we have to build a stationary network where people have to go and get stuff? No."
Of course, engagement -- and even community -- cannot be directly correlated to sales. But, excuse me, apart from direct-response advertising, what can? As for the other outstanding issues casting suspicion on the sustainability of widgetry, let's take one more look:
- Platform incompatibility. While some functionality is sacrificed, something close to universal code is not far off. Lazerow says by the spring, his apps will be, with a minimum of tweaking, one size fits all.
- What works for a sexy brand might not work for Charmin. Upon further reflection, why not? Given about two seconds thought, I came up with about 10 toilet-paper-relevant ideas in varying degrees of offensiveness, from SoftCam (rotating video of a basket of kittens, baby butts, ducklings, etc.) to a Full-of-Shit-o-Meter (feeding news quotes from celebs, athletes and pols that are transparently disingenuous or worse).
- Cost. Yes, $5 an install can add up, but many vendors charge much less. More to the point, though, who says that the calendar is the right allocation tool for marketing expenditures? As long as we're reinventing commerce, should we not consider the possibility that marketing programs will be financed for as long as they perform, without arbitrary campaign boundaries? "I guess I can't understand the marketers' narrow-minded definition of the controlled calendar, because that's not how consumers' minds work," says Briggs. "It's like Coca-Cola saying, 'All those people with the Coke memorabilia from the '50s, I want it out of their house, because that's not the Coke message today.'"
- Shelf space. Even if you accept that there is a finite amount of real estate on the world's 500 million social-networking pages, the universe is expanding by the second. "Saturate the market?" Lazerow says. "We're not even close. I can't see a world in which we're going to saturate this market."
Oh, and one final thing. If you are a marketer who's spent the past decade investing in a robust website to attract customers and prospects, and you're therefore disinclined to cannibalize your traffic by giving away Website-in-a-Can, don't get too smug. Your audience is making that decision for you.
| INSTYLE |
 |
| Widget: Hollywood Hair Makeover How It Works: Steal the hottest hairstyles from the likes of Jennifer Aniston and Cameron Diaz and plop them on your own head. Agency: Buddy Media |
Tony Zito of MediaForge, which handles Steep and Cheap, calls this "the slow death of the destination website." Consider the source -- the man sells widgets -- but even if he's hyperventilating, the trends are a bit ominous.
If Mohammed has indeed cut back on his visits to the mountain, it may be time for the mountain to go to Mohammed.
After all -- Ding! -- the fares are pretty low.
Subscribe to:
Posts (Atom)
