Real-time-bidding: How publishers and advertisers leverage online ads (a Michael Barrett interview)

One-on-one interview with Michael Barrett.

Michael Barrett joined Admeld from Fox Interactive Media, where he was Executive Vice President, Chief Revenue Officer and oversaw worldwide revenue for all properties, including MySpace, IGN, FoxSports.com, Fox.com, AmericanIdol.com and Scout.com. Before Fox, Mr. Barrett held senior sales positions at interactive leaders AOL Media Networks, GeoCities/Yahoo! and Disney Online.

The Strategy Web spoke briefly with Mr. Barrett about Real-Time-Bidding (RTB) and the benefit that Admeld can offer to publishers… and advertisers.

What is a private Ad Exchange and which role does Admeld play in this context?

The private exchange is built on Admeld’s core technology, it is an invite only marketplace. First, it leverages our yield optimisation engine, which connects to every major programmatic buyer. Second, it has an audience analytics module which enables the publisher to identify their most valuable users. And third, it has the analytics and controls necessary to help them stay aware of buying trends, price effectively and sell only to those they want.

Do you think, this model is right for every publisher?

The model makes sense for many large European publishers, but the solution isn’t right for every publisher. It’s meant for those that have the scale and brand equity to attract advertisers into their own marketplace. The private exchange is customized to a publisher’s needs, and delivers cutting-edge control over how you sell your inventory, to whom, and for how much.

Can you still put inventory through RTB on private exchange?

Yes, Admeld’s private exchange platform has been developed to primarily handle RTB and gives the publisher unprecedented, direct access to Admeld’s audience analysis and optimisation technology. The exchange platform works in concert with a publisher’s ad server and demand flows from the trading desks, DSP’s, and direct sold deals. This methodology gives the publisher truly informative access, control (including the ability to set price floors), and insights on their inventory, regardless of demand source.

Spot On!
The RTB technology approach is still quite new to the advertising industry. Admeld just recently launched a RTB network with quadrantOne on premium local audiences. sociomantic entered the European market last week – just some weeks after my company IDG signed a global agreement with Admeld to start their own RTB system called Techmediaexchange which will be going live soon. One of the latest studies by Forrester claims that RTB is accounting for 8% of the online display ad market in 2011. An interesting market for clients and publishers in the future…

News Update – Best of the Day

Wait or step ahead? It is a question of long-term strategy versus short-term tactics and planless activities most often in companies. Corporate sustainability is it’s new term. That difficult management question was put in front of 3000 executives who gave feedback. The results now can be seen in the study called “Sustainability: The ‘Embracers’ Seize Advantage”.

Some of the key findings…
- General benefit: 70% of the ‘Embracers’ see their sustainability initiative helps outperform competitors, compared to the 53% of the cautious adopters who thought the same way
- Revenue benefit: 66% of the ‘Embracers’ indicate that sustainability has added to their profit, compared to 23% of cautious adopters
- Management guideline: 52% of respondents say sustainability is a “permanent” part of their corporate management agenda
The message of the study is: move early, communicate sustainability, let everyone make it happen, measure it and communicate expectations.

Chris Brogan shares some interesting insights in the future of the marketplace. He sees them distributed, mobile, integrated, subscription-based, weblocal, and “global for the little guy”.

It is funny to see how companies use “speed” as a unique selling point… Coke & Mentos guys have harnessed the explosive power of these geysers: What happens when you combine 108 bottles of Coke Zero and 648 Mentos mints can be viewed in this video…

Do we have to talk about “conversation”…?

It’s the basis of humans living together. It’s the essence of people getting in touch with each other…, and finally doing business together. It builds the fundament of collaboration, of cooperation. It’s the breath of the age of social. What is “it”…? Well, it’s not rocket-science. And still it seems to be the never-ending challenge for companies, for brands, and especially for people who are running the business. It is… conversation.

“Often I wish people understood the word “Conversation” – To start a successful collaboration we must learn to lose fear of networking.”

Do managers really have to talk about “conversations”?
Yes, we do! Don’t you agree? And we all know why. We are getting sad about the way managers (don’t) encourage themselves to engage in conversations. How often do managers not respond to a written letter? How often did they not pick up your phone? How often have they not replied to emails? How often not shown any reaction to Facebook, Twitter and the likes?

Hello managers – wake up! There is somebody trying to have a conversation with you? You cannot argue what somebody wants before having listened to them, can you?! Ignoring is so easy and it happens so often. You can do better. You can participate. And your words have significance when you take part in a conversation.

How will traditional managers get new inspiration? How will they generate new connections? Yes, conversation is the answer…

Do brands really have to discover how to do conversations?
Yes, they do! They need to figure out what they want to be: person or economic construct. Active or passive conversationalists? Motivator or creator? Former sender or modern vendor? Brands might build a consitent dialogue but only value their opinion, playing according to their rules. Listening is where relevance brings brands back in the driver’s seat, and not making them sit still and beg that the driver (who ever that consumer is) knows the way towards to the targets.

Productivity, creativity, innovation, thought-leadership and ROI counts for brands. This M&M philosophy often goes straight against lose conversation. Brands have been shaped and formed around formal structures (organisations and meetings), planned grouping (= not Groupon but agendas), lead work-flows (step-by-step approach). In earlier years, conversations came with a coffee break, some biscuits, a cigarette on the floor. Conversation today comes with an email, a tweet, or a status update on LinkedIn at your desk. And they appear different in character and tonality, “the conversation mode is changing” as Eric Schmidt called it at the DLD11 in his augmented humanity speech.

How will brands find innovation in the future? How will brands get response to products and services? Yes, conversation is the answer…

Do companies really have to reinvent the human dialogue?
Yes, they do! Companies are made from (and made by) people. People always had not enough time in their lives. Conversations cost time. Time builds trust and drive efficiency. Email took us time, too. We had to learn how to communicate online. Not now anymore. We know how it works. It is just a different platform or technology every crucial department of your business will be using in the future, called Facebook, Twitter, Groupon, Quora or blogs. They will control our marketing efficiency, our sales opportunities, our upscale, our revenue sheets. And we won’t even know, when we don’t embrace and value the conversation on the social web.

Power to “processes, people, potential and possibilities” means opening up our mindset to a new way of conversation. A way that shows the value of starting the talk. A way that shows clients how companies rate their review, input and sharing of brand messages and product conversations. Customer just want to get the feeling that it is not a maschine out there they are buying from. They want to see the personal human touch that makes mistakes, laughs about themselves and answers when getting questions.

How will companies renew their strategy, their tactics, their visions…? How will companies build products that their customers want? Yes, conversation is the answer…

Spot On!
Conversations are the basis of your future business-strategy, as well as your web-strategy. This is nothing new, you knew it before. Companies have them multiple times every day. Brand can get engaged in them every minute on a day in the future. And you even more. Every minute you can have the chance to have conversations today. The only difference is that conversation is also happening online – not on the phone, not via fax, not via mail, not on the floor, or in meetings. You just have to embrace conversations… it is that easy.

Facebook starts Sponsored Stories – New ad model

Facebook starts a new advertising format that focuses on the “check-ins” and “likes” of Facebook users, and thus their friends. The new commercial product uses the traditional business or product recommendations that can be seen in other ad formats of the company.

Facebook calls the new advertising model Sponsored Stories (watch the descriptive video). It gives marketers the option to identify activities that members to target those peoples’ friends. The Facebook News Feed becomes the driver of the acitivity. Companies and brands can feature these activities via check-ins, custom applications and page posts (i.e. discount offers) in a column on the right members’ friends.

Sponsored Stories highlight the actions of friends while giving advertisers no control over messages. So, it is not a straight forward promotion but all advertising may be considered by viewers as company or product recommendations. However, it is not the companies that know where the advertsing goes but the users with their activities.

Compared to Twitter and their Promoted Tweets this is a new approach. Promoted Tweets focusses specific tweets tied to keywords which gives advertisers full control over their commercial messages. Facebook Sponsored Stories are following a bidding system. Slots are on a per-impression and per-click basis.

Spot On!
In my eyes, this is aclever approach to use the activities of Facebook users to generate revenue. The only question stays if the users want to have their face and name used for commercial formats of this kind. What if a user doens’t want to be “used” for commercial purposes of brands? It suggest that users need to have the option to turn this commercial feature off. And I can imagine that some will be saying “And where is my rev share?”

What comes up to your mind when you think about it? Join the conversation…

News Update – Best of the Day

The latest market outlook by Deloitte predicts that in 2011 social networks are likely to surpass one billion unique members and may deliver over 2 trillion advertisements. Although this sounds impressive, it is modest compared to other media, the CPM remains low and the market share remains at only 1% of the global online ad spend. The per member annual advertising revenue is approximately $4 which implies total 2011 advertising revenues of about $5 billion.

Will the publishing industry see a revival of print again? Everybody says social media is challening the print publishing industry. All of a sudden, the Content Marketing Institute has launched a media that is in some way a spin-off of the modern social web development, Chief Content Officer. The circulation is 20,000 marketers, with additional digital distribution. Yes, obviously there is a “digital spin” off as well…

Nike signed a big sponsoring agreement with the national football association of France (FFF). After years with Adidas, France signed a contract with Nike for their national football dress. And then they did this fantastic commercial with reference to my most admired work and poem from “Cyrano de Bergerac”, ending with the famous words “J’ai touche!”. Let’s wait and see what the French team will touch us in EURO 2012…

PS: At Starbucks mobile payment becomes reality. At least in the US where you can swipe your phone in front of a scanner that is checking your Starbucks account.

How Cisco’s SocialMiner helps improve the conversation with customers (a John Hernandez interview)

One-on-one interview with John Hernandez

John Hernandez is General Manager of the Customer Collaboration Business Unit (CCBU) at Cisco, which provides contact center and interactive voice applications to enterprises and service providers. In this capacity he oversees product and market development, and is closely involved in the business with the Cisco sales force and partners.

The Strategy Web spoke with him about the launch and benefits of their new customer care product SocialMiner.

What were Cisco’s most successful social medias tactics in the last 2 years? How did Cisco came across the new solution SocialMiner? Why is social media monitoring so important from a strategic point of view for businesses?

Cisco is very active in social media. Our employees were some of the earliest adopters of Myspace, Twitter, Facebook, YouTube, and other social sites. We have tens of thousands of active social media users in our company, as well as a robust and vibrant corporate presence on the social web.

Social media monitoring can become a key strategic advantage for businesses. From a contact center perspective, social media could be treated as “just another channel” in a multichannel approach. However, the public nature of social media, along with the sheer volume of social media postings, makes social media as much a business intelligence tool as a new way to engage with customers. Cisco believes that proactive social media customer care will have a transformative impact on how companies engage and serve their customers.

The concept of the SocialMiner product came from our observation of the changing communication habits and Internet usage of consumers. As consumers have adopted social media channels for their individual communications on an ever-increasing basis over the past couple years, it is only natural that they would consider interacting with a business via social media. This concept of social impacting customer relationships is a very active topic within the emerging “Social CRM” community.

Is SocialMiner just a Customer Service product? Bearing in mind that social conversations on the web affects the whole business…

Cisco SocialMiner is an engagement product, not a “listening product.” SocialMiner is designed to scale the quality and quantity of social media interactions performed by a business. SocialMiner can be used for a variety of business functions such as Support or Sales, but we believe the customers that derive the most value from social media will also use these engagements to drive business process change. For example, an organization could use SocialMiner as a source of business intelligence to provide real-time customer appreciation or criticism of a product or service (or of a competitors’ product/service). Social media can direct their business strategy. Cisco believes that companies that learn from social media will become closer to meeting their customers’ expectations and this will drive overall business success.

Which three benefits do business users have using SocialMiner compared to other tools in the market (Radian6, Alterian, etc.)

1. Cisco SocialMiner is complementary to brand monitoring dashboard solutions. It is designed to support scaling social media by leveraging the best practices from contact center type operational models: Queuing, Service Level Metrics (Average Speed of Answer), and productivity metrics for users. By contrast, many of the brand monitoring dashboards have pieces of workflow capability, but these capabilities are either relatively limited or recently introduced functions.

2. Cisco SocialMiner is a component of the Cisco contact center portfolio which currently includes an installed base of over 10,000 customers. SocialMiner is packaged, priced, and delivered along with Cisco Unified Contact Center Express and Cisco Unified Contact Center Enterprise solutions, and therefore it supports the same installation, deployment, serviceability, and user experience as these other Cisco collaboration solutions.

3. Cisco SocialMiner is a very easy to install and operate software appliance. It runs on premise or in a customer controlled data-center hosting facility and offers unlimited capture capability. Cisco SocialMiner is an API-first product with 100% of functionality available via REST API’s and all user interface delivered as OpenSocial gadgets with documented source that can be modified by Cisco channel or customers. This model supports the preferred consumption model of most enterprise organizations along with a broad customization capability.

Can it be used as a stand-alone product or only in combination with other Cisco products for customer service? Do you have any case studies of success?

Cisco SocialMiner can be used as a stand-alone solution. We have several case studies that illustrate SocialMiner’s success. Zone Labs is one of them. The small wellness company was looking to accelerate revenues & grow 1000% in next 3 years, implemented Cisco SocialMiner to increase customer engagement, customer satisfaction and sales. Zone Labs started developing social communities on their own website as well as Facebook, Twitter and other social media outlets. They used Cisco SocialMiner to route and queue contacts to experts within their organization.

Using SocialMiner, experts were able to proactively answer health and wellness questions via Twitter, providing encouragement to consumers on the Zone Diet, customer service and expert advice on questions such as vitamins and healthy recipes. Zone Labs saw improved agent productivity by automating capturing and responding to social media posts (currently estimated at ~10x). They gained greater customer satisfaction & brand mind-share from faster first inquiry resolution on the web, and were able to compete on comparable scale with larger companies. Their social media activity reduced their customer acquisition cost and created a larger funnel with more leads, that were converted more easily and more quickly than before.

Within 4 months of using SocialMiner, Zone Labs saw tremendous results:
- Web site transactions up 189%
- Revenue up 203%
- 202% increase in total visitors to www.zonediet.com

Thank you for your time, John. And by the way: I like your commercial for the product…

Study: Social Media still at early stages in companies in 2010

A recent study by SmartBrief and Summus on the State of Social Media for Business 2010 shows how companies use Social Media at the moment. More than 6.000 business decision makers took part and there are some trends that can be seen here. And what did we expect…? Social Media is still at early stages.

Most companies (66,5%) use Social Media 18 months now. Almost half of them are “playing” with Web2.0 tools, only 5,4% work with them for more than 3 years. Most companies focus on the top 5 Social Media tools: Facebook, Twitter, LinkedIn, YouTube and Blogs. The reason why they use these tools? As most of their clients are to be found at these places. Although they admit that they also use some niche platforms like FlickR.

Publishers knew it before brands: It takes time to make Social Media usage efficient. The study states that after 2 years companies see the value in Social Media and make it an integral part of their business strategy. Nevertheless, most of them predominatly still use it to raise awareness for their brands (no wonder if 60% of Americans and Canadians follow brands as of promotions and coupons, which an Empathica Consumer Insights research tells us). They talk about product or service information, spread their messages, and don’t rate the conversation with the clients. By not listening they waste a lot of energy and leave the real benefit of the user input behind.

One question that could be quite interesting for a discussion is why it takes so long for companies and brands to adopt and get used to Social Media. Is it because they don’t collaborate with Social Media agencies or because they like to work with internal resources? As we can see from the results, it could also be another factor: One third is not in the position to decide about Social Media, 33% see data security as an issue and 15% saw resistance from the managemetn a critical point.

Spot On!
In my eyes the two most interesting topics for hindering Social Media efforts could be minor trust and no understanding of efficiency of Social Media strategy. Only 7,3% see their strategy as very revenue generating. 14,2% rate their Social Media strategy efficient. Just 14,7% said their companies do measure Social Media efforts, while more than 33% don’t measure at all. At least Social Media is not seen as a fad anymore. If companies don’t understand the long-tail of Social Media, the achieved results won’t meet the expectations of the management. Although Facebook and Twitter seem to be the main platforms for Social Media use as of their reach (intensity), the real benefit could be for more companies by understanding the real impact of the community ideology, blogs, bookmarking sites, or in the future location-based social networks.

Nielsen study: iPad users open for ads

When the the iPad certainly was introduced by Apple’s CEO Steve Jobs it was said to be “a truly magical and revolutionary product.” This week I have bought an iPad myself and have tried to understand what the tablet is capable as a mobile business device. I cannot really say it failed. And a new study by Nielsen asking 5.000 mobile users shows us how the iPad is delivering businesses from the perspective of a new ad platform.

The Nielsen findings from their new “Connected Devices Playbook” suggest that the iPad owners are more open and responsive to advertising than mobile users of other devices – even those of the iPhone. The study shows that iPad users are more likely to buy products after being introduced to ads. And 60% of the respondents of users across the iPad, iPhone and all other connected devices responded they were “OK with advertising if it means I can access content for free.”

The magic formula for making ads for iPad users effective are interactive features: 45% of iPad owners said they were more likely to click on ads that included multimedia than 26% of iPhone subscribers and 27% of other connected device owners. Isn’t this perfect news for the launch of Apple’s iAd platform?

What makes marketers even more happy is that iPad users indicate that they buy a product via their mobile device because of an ad. 24% of iPad users made an in-store purchase compared to 10% of those who use other devices. It seems that the iPad and other mobile devices might offer a helping hand as a revenue driver to all retailers or shop-owners. Nevertheless, we might ask the question whether this is as of the new product and the hype around it, or if this will last in the future. The final question could be how Apple will change their single app sales strategy to make the use of the iPad more cost-friendly for users.

So, who is the typical iPad user? The Nielsen study says they tend to be younger and more male than users of other devices like users of the Acer Aspire One, the Kindle, the iPhone, iPod touch or the Sony PlayStation Portable. 65% of iPad users were male and under the age of 35.

Spot On!
Sometimes it is funny when you read these studies and remember your own shopping experience. Some weeks ago, when the iPad was not even available I remember a 45 year old posh women rushing into the Apple shop. She did not even realize that the sales guy next to me was explaining the benefits of an iPad to me. She just asked when the iPad will be available, got her answer and rushed out with the same urgency she came in. The sales guy was shaking his head that day, saying some of our clients are weird. When you think about how eager she was to buy the product, I can understand that advertising is still effective… not only on an iPad.

Direct Messaging export – a missing feature in social networks?

Some days ago, a Nielsen study said that in the US social network usage is more popular than email. This does not surprise me, when I think about Luis Suarez speech at the Web 2.0 Expo 2008 “Thinking outside the Inbox”. If we agree with him, then there is one feature definitely missing in social network…

How I came across this missing feature…
In my new job role I do a lot of business socializing which is quite normal when the business is done 90% with international business contacts. A lot of business brainstorming is being kicked off or happening on the fly and you don’t think where you communicate. Many of these conversations start via the direct messaging functionality -comparable to email communication- in social networks. Some of them end in nothing. Some turn out to be brilliant contacts which become interesting prospects. And suddenly these end up being leads or potential revenue drivers. And then there comes the problem…

Where is the direct messaging extraction functionality? Some kind of external saving or export module to save the content and communication? Not speaking of an “email archiving” technology?

If your business, or the business of the company you are working for, is meant to be compliant (and which is not today…?) how can you export a conversation that already started in a social network? OK, you could copy it, and send it via email again. Quite uncomfortable though, right…? Or you save all the emails that you get from the social network providers. A lot of redundant data saving…

In business networks like Bebo, XING or LinkedIn users are possible to export the database of their contacts in one go – … but not an email communication threat. Meaning, if you have had a good conversation and mentioned some kind of business critical data, pricing, or offering than you have to have the proof for tax or auditing service reasons – and ideally you can extract it in one go.

In my eyes, this is a missing feature that at least all social business networks should be offering. Don’t you think?

Google Ads: Marketers have more influence on brand name key words in the future

If your company runs a business in Europe using Google Ads, then the announcement of Google becomes of interest for you. From 14 September 2010 your company will be able to buy and include brand names in keywords in your Google Ads campaign which have been trademarked by other businesses. These changes are extension to the changes made in the UK and Ireleand in 2008. In the US, this has been possible since 2004.

Many companies use Google Ads in order to drive attention to their websites and increase visibility about their products and services. Up until now, it was a court issue for companies to stop third-party ads from being mentioned alongside the paid keyword results of a trademark name. The problem came up when the French luxury goods company LVMH Moët Hennessy Louis Vuitton complained that only they have the rights to be able to use and buy such trademark terms in search offerings. The objective behind this cause is obvious: Brands wanted to protect their brand name.

And in the era of the social web, this also becomes an important impact on brands and the influence on their consumers. “Google argues that selling brand names as ad keywords to multiple bidders helps consumers because it allows them to find product reviews, sellers of second-hand goods and other information. It stressed that the new policy would not extend to the actual display text in search findings.” The idea is that users will find more relevant context connected to the brand name. The bad news for brand owners is that a hifi dealer will now be able to use the products brand names in its keywords.

Spot On!
Seeing this movement from a Google perspective it is a clever approach to boost their Google Adwords business. Although Google stressed that the new policy would not extend to the actual display text in search findings. Nevertheless, questions arise if Google has to watch out for Facebook as a competitor in the fight on search revenues. If more and more people are spending more and more time asking for the opinion of their friends (see launch of Google Questions) instead of searching the answer via search machines, the world of advertisers and brand might follow.

So, did your company already move budgets from Google to Facebook?

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