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Apr 10, 2009

Time to "Tearn"?

For a number of years, I’ve been pondering how the Snowflake Effect1 could influence learning. For those who are new to this concept of the Snowflake Effect, in essence it’s about the transformation of society from a model of mass production to one of mass personalization. Think of it as providing just the right things for just the right people at just the right time in just the right context.

Many times everyday, we all have the need to learn about things that are just right for us, and ideally the perfect learning resources are available at just the right time. We hope for the Buddhist saying “When the student is ready, the teacher will appear.”

Since a very young age, I’ve been fascinated by the “teachable moment”, when someone is perfectly ready, willing, and able to learn something new. How can we develop more ways to foster teachable moments every day, and how can we provide just the right resources (people, content, and environment) exactly when we need them?...(more)

Wayne Hodgins was the strategic futurist at Autodesk Inc. for over 20 years and now an Autodesk Fellow. Wayne brings keen foresight and thought-provoking perspectives on human performance improvement, knowledge management, learning, and the general nature of design to a broad range of corporations and organizations worldwide.

Apr 9, 2009

Building a Twitter Ad Agency for Entertainment Companies

from Advertising Age - Video

Tweeting Star Carrie Bugbee Explains Her 'Mad Men' Success 

peggyolson (12,000) jazzcrowd (2,000) 

DiGiorno Turns to Twitter for Flatbread-Pizza Launch

Kraft Will Deliver Frozen Pies to Tweetups to Generate Word-of-Mouth

CHICAGO (AdAge.com) -- DiGiorno is launching a flatbread pizza by way of TV, print and ... Twitter. The freezer aisle's largest-selling pizza brand is wading into social media for the launch, tapping tweeters with strong followings and offering to provide food for tweetups.

Kraft will deliver DiGiorno to tweetups hosted by influential tweeters to promote its new flatbread pizza.
Kraft will deliver DiGiorno to tweetups hosted by influential tweeters to promote its new flatbread pizza.

"We've always been out there with a lot of different media touch points, with a combination of online and offline," said Tom Moe, director-marketing for Kraft's DiGiorno brand. "We're always looking for the newest and most relevant places to be in both areas, and we thought this would be a great offer to combine with Twitter."

DiGiorno's new flatbread pizza is a thinner, crispier version of the premium frozen product.

Reaching out to influential tweeters
The brand has tasked PR agency Weber Shandwick with reaching out to influential tweeters willing to host tweetups, or in-person get-togethers prearranged on Twitter, in Chicago, New York and Los Angeles. Kraft will deliver DiGiorno to the events and hope attendees spread the word. Just what makes an influential tweeter "is something we're in the process of working out with the folks at Weber," Mr. Moe said. The brand's advertising agencies include DraftFCB, MediaVest and Digitas, all out of Chicago, and AKQA, San Francisco.

"The beauty of the tweetup is it's not necessarily millions of impressions at that point in time," Mr. Moe said. "It's the quality of interaction we're going to have with these folks who are passionate about relevant new news." But that makes for something of a fuzzy return-on-investment measurement. Mr. Moe said Kraft will measure success based on engagement at the event, and how much tweeting and blogging is generated by it.

DiGiorno has been among Kraft Foods' more technologically forward brands. When its popular "DiGiornomics" campaign launched in August, Kraft built accompanying contextual-search ads designed to intercept Yelp and Citysearch users looking for "pizza delivery" and instead offer DiGiorno. That program has been expanded for 2009...

YouTube Is Doomed

Ed: Metaphoric writing below. Is it about the economics of video advertising?
  • Is the glass half full or half empty? There is a lot of garbage on Youtube, but the tEarn supersites have shown huge depth of branded content on virtually any topic. 
  • The Credit Suisse analysis attempts to separate the value of Youtube from Google Search. Is there more synergy among the properties that are not accounted?
  • What about the massive Google affiliate program? Does Youtube contribute to that growth for Google?
It is a challenge to directly monetize the Youtube video. But suggesting that Youtube has reached it's peak and has failed is pretty stupid analysis.

from Silicon Alley Insider by 

YouTube, that incandescent tower of video Babel; monument to the sloughed-off detritus of our exponentially-exploding digital culture; a Technicolor cataract of skateboarding dogs, lip-synching college students, political punditry, and porn; has reached the zenith of its meteoric rise; and Icarus-like, wings melting; is spiraling back to earth. Despite massive growth, ubiquitous global brand awareness, presidential endorsement, and the world’s greatest repository of illegally-pirated video content, Google’s massive video folly is on life-support, and the prognosis is grave.

Believers would have us think that Google (GOOG) will sustain YouTube, indefinitely if necessary. Proponents of online advertising argue that increased understanding of the medium will lead to more advertising dollars at better CPMs, lifting all boats in a sea of monetization. In the short term, however, neither celebrity presidents, a rabidly growing customer base, nor a brand which has in three short years injected itself into the global cultural lexicon can forestall the inevitable: YouTube is soaring towards the future like a pigeon towards a plate glass window.

The problem lies with the bean-counters. According to a report by Credit Suisse, YouTube is on track to lose roughly $470 million in 2009. No matter Google’s $116 billion market cap: a half-billion dollar loss on a single property, even one as large as YouTube, is a bitter pill to swallow. Even Eric Schmidt, talking to the New York Times about the YouTube acquisition, was quick to say that, going forward, Google would “be more careful with potential large expense streams, which are of uncertain return.”

Credit Suisse estimates YouTube will manage to rake in about $240 million in ad revenue in 2009, against operating costs of roughly $711 million, leading to a shortfall of just over $470 million. This half-billion dollar loss comes after more than a year of feverish experimentation in various forms of advertising, cross-product embedding, licensing and partnership deals. YouTube is adamant that ultimately they’ll find an advertising solution that will enable the ungainly behemoth to reach profitability. Looking at the math, it doesn’t seem likely.

The economics are hard to overcome. Assuming YouTube delivers the 75 billion streams that Credit Suisse projects for 2009, and assuming YouTube manages to slot an ad for every stream (which is practically speaking, impossible, given the nature of much of their content), YouTube would have to achieve a $9.48 CPM for every video impression shown. Presumably, the videos YouTube is already monetizing represent the best content available, with diminishing returns as they reach deeper and deeper into a repository rife with copyright violation, the indecent, the uninteresting, and the unwatchable. Hulu claims to be charging a $30 CPM, of which roughly 70% goes to the copyright holder. Averages for other proprietary content hover around the $10 CPM mark. CPMs for user-generated content, assuming you can attract the advertisers, tend to be measured in fractions of a dollar.

So what does this mean? It seems safe to assume that YouTube’s traffic will continue to grow, with no clear ceiling in sight. Since the majority of Google’s costs for the service are pure variable costs of bandwidth and storage, and since they’ve already reached the point at which no greater economies of scale remain, the costs of the business will continue to grow on a linear basis. Unfortunately, far more user-generated content than professional content makes its way onto the site, which means that while costs grow linearly, non-monetizable content is growing geometrically as compared against the monetizable content that YouTube really wants and needs to survive. This means less and less of YouTube’s library will be revenue-contributing, while the costs of delivering that library will continue to grow.

With the ongoing hammering of ad CPMs and unstoppable growth in the site’s popularity, Google is going to bleed substantial cash on this experiment for the foreseeable future. With costs of operation at half a billion dollars and growing, YouTube’s future is very much in doubt.

What are Google’s options? They seem unlikely to sustain a billion-dollar annual experiment with no path to revenue, no matter how much they paid for the original asset. In an organization feeling the sting of layoffs, is this really where Google wants to spend its money? It all depends.

Google could take a lesson from its neighbor, Hulu, and focus only on proprietary content with existing consumer loyalty and real monetization prospects. With its massive audience, this is a viable option, and a direction in which YouTube has already taken some baby steps. Axing user-generated content would seem to be anathema given the site’s roots, but it may be the surest way of putting the business into the black.

Alternatively, YouTube could implement a subscription structure for the site, either monetizing certain members-only content, or requiring users to create a paid account in order to contribute content. With so many marketers looking at YouTube as part of their viral strategy, this too could be a viable option.

One thing is clear: YouTube cannot maintain its current course and remain a going concern. Google can continue to fund the experiment for a period of time, but at some juncture, shareholders will ask hard questions about why Google is sacrificing half a billion dollars to support a project whose chances of providing a return, at any point, is dubious at best. Advertising cannot solve the problem, at least not in its current form, and not in the near term. With a diminishing field of options, a massive, growing, cost center, and an economy in recession, Google will need to make some hard decisions about the future viability and business model of its prodigal child.

Apr 8, 2009

This Machine Eats Tweets: The System Behind @Comcast and Others

This morning my home wifi was having trouble and I posted a message to Twitter saying, "My wife has decided to start the day with a call to Comcast customer service, I should have offered to poke her in the eye with a spoon. Would have been more fun for her." Within minutes a man named Bill (@ComcastBill, really) publicly replied to ask if he could help.

I didn't think much of it, I assumed he was camped on a search.twitter results page for the word "Comcast" or maybe had subscribed to an RSS feed for the search. It turns out though, that far more than that was happening behind the scenes. An extensive machinery of tracking, delegation and analysis stood between Bill and my little Tweet. Maybe it has to be that way, maybe it's a good thing - but there's something deeply disturbing about it too.

Companies all around the world know that "social media" is important and they are investing time and money into figuring out how to deal with it. Early this morning website analytics heavyweights WebTrends announced that they have made a deal with upstart social media monitoring firmRadian6 to offer a co-branded solution for keeping track of blog posts, Tweets, and other online ephemera mentioning your company.

Now the company's customers will not only be able to see extensive traffic data and to pull that data from what WebTrends calls the first free traffic data API on the market - they'll also be able to view social media mentions off-site in a relatively sophisticated interface. I asked Radin6's Chris Ramsey about what probably went on behind the scenes after I Tweeted about Comcast this morning. He said he couldn't say how Comcast in particular was using the software but it wasn't just a casual conversation. "Absolutely," he said. "There is more going on there."

radian6fullscreen610.jpg

Radian6 offers a sophisticated interface, but it's an odd one too. It's built in Flash and allows a fair number of different ways to slice and dice data. Data like, how many people are talking about you online vs. a competitor and the relative "influence" of those people. There's more advanced Customer Relationship Management (CRM) technology on the way into Radian6. Ramsey told us today that "if you look at all the major CRM companies out there, they are adding social listening technology - and as a social listening service, we're adding CRM."

ComcastBill.jpgThe interface is slick like an iPhone, though, and an iPhone you can't jailbreak. The company gives you a variety of ways to deal with the data but you can't, for example, get an RSS feed out of it. There's something that feels condescending about these kinds of services. Why can't the marketers using them learn how to use the web, like the rest of us have? That's not an entirely fair critique as many sophisticated marketing geeks find systems like this (and Radian6 in particular) useful for dealing with data in aggregate. Many customers in this market, though, are jumping over from a workflow based on sticky notes and pasting blobs of text into Excel, and sometimes very infrequently even doing that. [Left, @ComcastBill]

The fact is, subscribing to a search feed for relevant terms in various search engines just isn't going to scale for larger businesses. When your online customer service team has a substantial number of people in it, you're probably going to need a system that goes beyond informal familiarity with people and one-off responses to online mentions. Dell's VP of Communities and Conversation, for example, has at least 45 people working under him. Having a system to listen, analyze, track, and export data from makes sense.

This isn't a story just about Comcast, Dell, WebTrends or Radian6. It's a story about corporate engagement with emerging social media.

"Social media is like the social phone, smart companies are listening to that and managing it with some process around it," Radian6's Chris Ramsey says, "That's the evolution of the call center." He says that many major companies have roadmaps that point to training a new breed of marketing and communications/customer service hybrids to staff their call centers.

The end result, though, is strange for those of us interacting with these customer service reps. It's not just Bill from Comcast and I trading public replies on Twitter (I can't DM him, he's not following me), and when Bonnie pinged me hours later in response to conversation about this article, it wasn't a casual person-to-person conversation. It looks like it's just you and them, but behind them there's a curtain covering a whole mess of cogs and pulleys, analyzing you in different ways. How many followers do you have? How did you respond the last time a company rep used your name publicly? Who's in charge of discussing your concerns with you on Twitter, on your blog, or elsewhere?

Add the fact that many of these positions are, or will someday be filled with sales people, have them view these conversations through a closed system of predetermined criteria, and set it all inside a big CRM database. What do you get? Is it a story of authentic connection in a democratized public conversation - or is it a charade?

It's kind of a modern day horror story, isn't it? Web 2.0's potential benefit for humanity tragically sold short by social media because it fell under a fog of marketing software. Would-be short-form conversationalists jumping in with CRM-tinted glasses secured to their faces. One of my co-workers says that within minutes of his wife Tweeting about her art studio last night, she was friended by scads of art companies and salespeople. Who wants to have a conversation in that context?

Or maybe it's just a matter of changing our expectations. Maybe this is all good; the new customer service - a lot like the old customer service, but in your blog comments and replies tab. What do you think? We'd sure like to know, because we expect there will be a whole lot more activity like this in the near term future.

Apr 6, 2009

Understanding Twitter Traffic - Analysis from the UK

What would a Google-Twitter marriage mean?

Last week it was reported that Google is in talks to purchase Twitter. Therefore, now seems like a good time to revisit some of the stats, starting with the top level traffic figures. As the chart below illustrates, UK Internet visits to Twitter have increased 6-fold since the start of the year and 32-fold over the last 12 months (March 08-09). Last week (w/e 04/04/09), Twitter was the 50th most visited website in the UK, and the 5th most popular social networking site. To put that figure in context, last week Twitter received more UK Internet visits than the Daily Mail, RightMove,MSN UK SearchDirectgov, and all retail websites with the exception of eBay, Amazon UK, Play.com and Argos.

UK_Internet_visits_to_twitter_march_2009_2008_chart.png

I should also add the usual caveat: the service is probably even more popular than our numbers imply, as we are only measuring traffic to the main Twitter website. If the people accessing their Twitter accounts via mobile phones and third party applications (such as Twitterrific, Twitterfeed and Tweetdeck) were included, the numbers would be even higher.

Turning to relationship between Google and Twitter, I thought that it would be interesting to compare the UK’s favourite micro-blogging website with its favourite social network (Facebook). During March, 24.3% of Twitter’s UK Internet traffic came from Google properties, whereas for Facebook the figure was 34.6%. A typical website in the UK receives 39.9% of it traffic from Google properties, so Twitter is less reliant on the search giant for traffic than both Facebook and the UK average. However, Twitter’s largest source of UK Internet traffic is actually Facebook (which accounted for 18.2% of its traffic in March, compared to 15.4% from Google UK), presumably a result of the integration between Twitter updates and Facebook status feeds.

Looking at it from the other direction, Twitter also sends less of its downstream traffic (10.9% during March) to Google properties than Facebook does (17.9%). The top downstream website visited after Twitter is Twitpic, followed by Facebook. Google UK ranks third, while the only other Google properties in the top 20 are YouTube (4th), Google.com (6th) and Gmail / GoogleMail (8th). Therefore, while there obviously is quite a bit of traffic flowing between Google’s properties and Twitter, there isn’t as much as there could be. Assuming that Twitter continues to grow, increasing this traffic would provide a good reason for Google to invest in the site.

But what about the other places that Twitter sends traffic to? It may be the 50th most visited website in the UK, but Twitter was also the 36th biggest source of traffic to other websites in the UK during March. In order to see how Twitter shapes up as a traffic source when compared to the ‘competition’, I’ve created the graph below. It illustrates the percentage of Twitter’s downstream traffic that goes to key online categories and compares this with the same data for Facebook, Google UK and MSN Live Mail / Hotmail (respectively the UK’s most popular social network, search engine and webmail service).

where_to_from_twitter_facebook_google_uk_hotmail_march_2009_chart.png

Heather Hopkins conducted a similar analysis in the US, and my conclusion is very similar: as a source of traffic for other websites, Twitter is more like a social network (i.e. Facebook) than a search engine or email service. Like Facebook, Twitter sends the largest amount of its traffic other online media websites. The top four downstream categories from Twitter are Entertainment, Social Networks, News & Media and Lifestyle, which together accounted for half of all post-Twitter UK Internet visits during March.

In contrast, just 4.7% of Twitter’s downstream traffic goes to Shopping & Classifieds websites, whereas Google UK sends 13.9% of its traffic to online retailers. Given that Google is still much bigger than Twitter, this means that Google UK alone currently sends 377 times more traffic to websites in our Shopping & Classifieds category than Twitter does. As you can see from the chart above, the picture is similar for other ‘transactional’ industries, such as Business & Finance and Travel.

So, as it currently stands (and assuming that Twitter can develop a viable business model), acquiring Twitter wouldn’t have much of an impact on Google in the areas that currently generate the most paid search revenue, such as retail, travel, insurance, telecoms and finance. However, it would help to imbed Google further within the online media landscape. The combination of Google Search, YouTube, Twitter, Google News and Blogger would certainly have a dominant position in the market.

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