Sunday, December 14, 2008

Cuts cuts cuts

How much money are social networks making from advertising? Not nearly as much as estimated earlier this year. Back in May, eMarketer trimmed their estimate for 2008 social network advertising spending in the US to $1.4 billion. Today, they’ve lowered it once again, to $1.2 billion.

The cuts are more dramatic when you look to 2009, where eMarketer now projects ad revenue of $1.3 billion, down from a previous estimate of $1.8 billion and representing tepid growth year-over-year. Of that revenue, the firm estimates that 65% will go to MySpace and Facebook, leaving just $435 million in ads for the hundreds of other social networks and widget providers to fight over next year.

While hardly surprising given estimate cuts for the broader online advertising industry, the news is a sobering reminder of the need to find business models that extend beyond advertising. Perhaps that’s part of the reason we’re seeing so many new mobile applications and ways to charge social networking users money, like virtual gifts that can be redeemed in the real world.

Saturday, November 29, 2008


The question that rises is whether we are headed toward a future where sites will no longer simply sell banner ads or paste in code to display text links and hope to drive more and more traffic to push up the number of impressions that they can sell. The impression based model is a numbers and volume game that is slowly dying online. Affiliate marketing, content syndication and other endorsement based models of online advertising are taking its place as a way to make advertising more effective, by doing what seems to be unheard of in advertising ... making content creators CARE whether or not visitors to their site click on the ads. This is leading to three big things:

1. More contextual and topical ads are more relevant for users
2. Endorsed ads for products are more convincing and reduce consumer distrust of advertising.
3. Better ROI (click rates, cost per click, etc.) for advertisers.

On the other side, the argument against askvertising is the often discussed separation between advertising and editorial. How can you expect content creators to be impartial and unbiased when their livelihood depends on the ads? When a content creator approves an ad to be placed along with content (which is the case with affiliate marketing), or the ads are based on the context of the content (which is how most text advertising works), then the lines between advertising and editorial become grayer. Combine this with the necessity for many of these new sites to support themselves with pay for performance based ads, and generating clicks from the audience becomes a necessity. In this sense, askvertising is the digital equivalent of the donation box at a church or temple.

What does this mean for online advertisers? Simply that online media planning today needs to be about more than just buying impressions and placing banners. Making askvertising work for you means finding the right strategic sites to partner with, building out a robust affiliate marketing program, and stop focusing on volume of impressions and more on effectiveness of placements in driving action. It's time advertisers and sites alike start to figure out how to make the trend towards askvertising work for them.

Wednesday, October 8, 2008

MSc & undergrad in Social Computing

The University of Michigan, the first to offer a master's specialization in social computing, is now opening up the opportunity to undergrads with the launch of a new undergraduate major in informatics that features a social computing track.

Students in the social computing informatics track will build and evaluate social software applications and study the influences of these systems on society.

Monday, October 6, 2008

Mobile Internet Penetration

I was sitting in my car the other day, waiting for a friend to arrive at the airport. Flight was delayed for 2,5 hours. Luckily enough I had my pda with me so I spent a couple of hours browsing around, reading blogs etc. Otherwise I would have to just sit in my car and talk on my mobile until my friend came to the rescue. Unfortunately it was almost 2:00 am so i don't think many friends would be available and willing to chat, at least in this continent. Alternative to that would be counting all airplanes arriving and leaving the airport and calculating the median of the interval between two consecutive arrivals and then divide it by the number of city buses leaving the airport and their departure intervals... Or something similar...
So, I felt very lucky for being able to just browse around, read my emails and access my office data from my mobile. I really felt joy and satisfaction in being able to do something useful with my time which would otherwise have gone to waste. I was thankful for the mobile internet service!
And then the question came to me. What is the penetration of mobile Internet usage? Is it something people use, or is it still considered a luxury service amongst the lucky ones who can afford it?

Next day, I googled a little bit and came across a research recently conducted by nielsen on the subject.

Nielsen currently tracks mobile Internet penetration in 16 countries (Greece is not one of them). Among these countries, the U.S. leads in mobile Internet penetration among wireless subscribers with 15.6%, followed by the U.K. (12.9%) and Italy (11.9%).

Of the countries tracked, Indonesia and New Zealand have some of the lowest mobile Internet penetration rates—just 1 out of 100 Indonesian subscribers uses the mobile Internet each month, and just 1.6% of New Zealand’s mobile subscribers do so.

In the U.S., mobile Internet has become a mass medium. As of May 2008, there were 40 million active users of the mobile Internet in the U.S., based on past 30-day usage. And this is just a subset of the 95 million U.S. mobile users who subscribed to the service but do not necessarily use it. To break it down:

  • There were 254 million U.S. mobile subscribers in Q1 2008, according to CTIA, the International Association for the Wireless Telecommunication Industry
  • According to Nielsen, 144 million (57%) U.S. mobile subscribers were data users in Q1 2008 (defined as those subscribers who used their phone for any data use, such as SMS [Short Message Service] text messaging or accessing the mobile Internet)
  • Ninety-five million (37%) U.S. mobile subscribers paid for access to the mobile Internet, either as part of a subscription or as a transaction
  • Forty million subscribers (15.6% in May 2008) were active users of mobile Internet services, using those services at least once on a monthly basis
  • Mobile Internet use accounted for $1.7 billion in revenue in Q1 2008 (more than $5 billion in total revenue in 2007)

The audience using mobile Internet in the U.S. is demographically diverse enough to present marketing opportunities for all types of products and services.

Less talk, more text

Bring on the keyboard!

According to a new research by Nielsen, the average mobile subscriber in the US sent and received more SMS text messages than mobile telephone calls during Q2 2008. This was the second consecutive quarter in which the average number of text messages was significantly higher than the average number of phone calls.

Average Monthly Calls Made/Received and Text Messages Sent/Received per US Mobile Phone Subscriber, by Age, Q2 2008

Although the research is an indicator of rising mobile data use, the two types of mobile communication are not directly comparable. Users typically convey far more information in a voice call than in a text, so text "conversations" can require multiple messages.

It was clear until now that sms messaging was popular among younger mobile users but nowdays the tendency is towards global adoption. Features like click to map, click to call or click to video embedded in messages open an era of new possibilities and services.

Sunday, August 17, 2008

Small problems, big business?

While wondering around I came across Fonolo, a company in beta that spiders phone trees at big companies and promises to make it easy for you to go straight to the spot you want. Then it calls you when the phone is answered and records the call so you can keep a record.
So, what is this? It happens to me all the time. Wanting to call someone or some service in a major corporation and having to go through a really long path before getting who I am looking for (hopefully). Try Dell!
Is it going to work? We 'll see.

Great ideas can be found all around!

Web 2.0 tools help enterpises says McKinsey Survey

Companies that are deriving business value from Web 2.0 tools are now shifting from using them experimentally to adopting them as part of a broader business practice according to the latest McKinsey Global Survey Results titled Building the Web 2.0 Enterprise.

This survey also shows that the fundamental changes to the way the companies view Enterprise 2.0. These companies are not only using more technologies but also leveraging them to change management practices and organizational structures. Some are taking steps to open their corporate "ecosystems" by encouraging customers to join them in developing products and by using new tools to tap distributed knowledge.

Isn't that interesting?

Thursday, May 8, 2008

A lot of great ideas still looking for ways to monetize

And now the million dollar question!

Ok, so you can get everything in front of you through a single interface. You can see which of your friends or the people you follow posted what, on facebook, myspace, flickr, youtube, twitter etc. You can easily view their photos, videos, blogs, comments etc. and everybody is happy.

But let’s try thinking the other way around. Let’s say you are that guy posting everything , leaving your mark everywhere. And your content is popular and you 've got a lot of views and a great bunch of people going through everything you post. You are That social guy. Or you are a band posting videos and songs on youtube and myspace and your music is often requested or streamed on lastfm and Pandora (by the way I really miss Pandora). Wouldn’t you like to know in terms of both quantity and quality, the extend of “your content’s impact on the world”. Wouldn’t it be great if you could get a great customizable attractive visual report of everything your content has gone through? How do you monetize? When and how do you collect?

Wouldn't be even greater if this could be the way for sponsors to search and find the exact content to sponsor? Advertising agencies would have a clear view of the popularity and buzz created by certain kinds of content and publishers.

In my search for a solution i came across traackr. This great little tool let's you track what's going on with your content on all the different networks it is posted. Through a clever scoring mechanism you get a clear view of what is popular and what is not.

Wednesday, May 7, 2008

Web 2.0 moving forward

Ok, we live in a web 2.0 world. And there is a lot of small talk around about a web 3.0 coming up.

Web 2.0 is almost everywhere you look. Everybody has at least a facebook account. Well, almost everybody… I ‘ve been trying to get back in touch with old friends for quite some time with limited success. All I get is Texas holdem buddy requests, invitations, pokes, super pokes, kisses, hugs, extra hugs, bites, comparisons etc. Is it just me or is facebook getting too complicated, too spammy and impractical?

I guess I am not the only one.

The way to go is trying out aggregation models for the hundreds of social networks everybody is mingling on. Now you can control all your social networking (most of it actually) from single site, through a single interface with a single sign-on authentication model.

Users begin to employ these emerging new tools to better manage and track their various online relationships, both personal and professional. The introduction of these new Web applications, such as Friendfeed, Socialthing!, Spokeo, Second Brain, and Iminta, are making it easy for users to keep track of what their friends are doing online while simultaneously demonstrating that there are compelling alternatives to being social online without having to, say, actively maintain a Facebook account. In fact, that's the very premise of this new type of social Web utility, which automatically tracks a user's public activity at sites around the Web including blogs, Flickr, Twitter, and so on, and creates a single convenient feed for others to consume and track.