Archive for February, 2008
02/29
2008
Chatting with Founders/CEO’s: Exclusive
I’ve always been extremely interested in talking with other CEOs/Founders of digital media companies and learning what they are up to and how they are doing it. Over the next ~12 days, I’m going to be releasing interviews with both industry leaders and up-and-coming allstars. If you’re interested in participating in future series, please contact me.
Below is a list of who is participating in no particular order. Please check back daily for the latest interview, starting March 3, 2008 (until the book release on the 12th).
- Andy Monfried - CEO & Founder, Lotame
- Ricky Van Veen - Co-Founder & Managing Editor, College Humor (IAC)
- Sam Lessin - CEO & Founder, Drop.io
- Eric Yoon - CEO & Co-Founder, JobThread
- Allen Stern - CEO & Founder, Center Networks
- Howard Yeh - VP of Corp. Development, Healthcare.com
- Jordan Garbis - Co-Founder, Haystack Media
- Gabe Zichermann - Founder & CEO, Rmbr
- Allen Murabayashi -Founder & CEO, PhotoShelter
Digg
Del.icio.us
Stumble
Sphere It
02/28
2008
Coloring Outside the Lines: Update
I’m getting excited as it’s about 12 days until the launch of my first book, Coloring Outside the Lines. The details of this book are fairly fuzzy unless you’ve been over to the official site for the book, but wanted to update everyone as to what to expect:
- Content Sections: 8 (w/6 chapters)
- Total Pages: 131
- Beginning of book: all about entrepreneurship, raising capital, startup ups/downs
- Ending of book: trends in digital media
- Style of book: paperback
- Writing style: relaxed, blog-esque writing (my preferred all around style)
The content/chapter breakdown list is as follows:
- Preface
- Introduction
- Some preliminaries
- Strategy
- Raising funds
- Branding and marketing
- Trends in the digital age
- Conclusion
Looking forward to sharing the book with everyone!
Category: Darren Herman
02/28
2008
links for 2008-02-28
-
The new model creates a more trusted environment for reaching high-value, frequent purchasers, whether of airline tickets, electronics, clothes or other items.
-
MediaPost Publications - Study: Brand-Driven Traffic Converts Best For Online Retailers - 02/28/2008“Visitors arriving via direct access or a bookmark stay longer, view more pages, are more likely to purchase and more likely to spend a higher dollar amount than visitors from other sources,” the report said.
-
Tracking study conducted by Solutions Research Group, nearly 80 million Americans (43% of the online population) have watched one of their favorite TV shows on the Internet, up significantly from 12 months ago when that figure was just 25%.
Category: Links
02/27
2008
links for 2008-02-27
-
Fascinating what social data and mining can do… I LOVE data
-
An interesting take on web analytics
-
I feel bad for these guys…
-
A VC could then get in early enough to buyout the technology at a great price and swap out the team with a pre-assembled all-star team…. though this is not the business VC’s are in.
-
I bet that only $200-300mm of those operating expenses had anything to do with paid search. So if that’s true, and it’s a wild eyed guess, then Google is spending close to a billion dollars a quarter on stuff that is not producing revenue right now.
Category: Links
02/26
2008
links for 2008-02-26
-
Sherri writes a bit about my upcoming book
-
Yahoo will soon be allowing third parties to enhance the Yahoo Search experience. The new platform, codenamed “SearchMonkey” and officially called Open Search Platform, will consist of a set of APIs that allow third parties to modify search results
-
We must not trade our advertising inventory like pork bellies.
Category: Links
All good things must come to an end some time
But don’t burn the day away
Don’t burn the day away.Come sister, my brother
Shake up your bones, shake up your feet
I’m saying open up
And let the rain come flooding in
Wash out this tired notion
That the best is yet to come
Pig, by Dave Matthews Band
I thought that the above quote is relevant for today’s breaking news as reported by AlleyInsider and PaidContent amongst other sites re: Google. ComScore is reporting that clicks from Google Search has been flat (year over year) and potentially down sequentially. If you’ve been following Google’s stock price, you’d see that it’s down about 7.11% as of writing this midday Tuesday.
My take: We’ve set the expectations so great for Google (as reflected in their stock price) that eventually, at some point in time, this great American uber dream of a company is going to fall flat. Every single company in the world, including Berkshire Hathaway (VERY different from Google) has experienced tough times (’98-’00).
Google makes a lot of money in search but is looking to grow their pie in other areas of media including games, print, display, video, radio, television, mobile, and more. They’ve made quite a few acquisitions to bolster themselves in these areas, but just like any other company in the market, they are going to have to wait until spending increases in these areas in order to capture any meaniningful marketshare (and revenue).
Should Google split off it’s search unit and seperate out everything else? That’s a thought… what is your take?
Also, take note of Goldman’s statement of big media slowdowns, though with the upfronts looming (though many brands may be sitting out), we may see quite a few dollars being spent.
This post opened with a quote from the song Pig, by Dave Matthews Band. The quote ends by saying, “the best is yet to come…” - I’m excited for whatever that may be.
Category: Advertising & Marketing
02/25
2008
Click Attribution & The Bigger Picture
Microsoft appeared heavily in the press today because of their announcement regarding measuring “Engagement Mapping.” I think this is certainly welcome in the marketplace but they are hardly the first to pave this path. Back in June, Atlas released a study that critiques “last click” attribution.
Taken straight from the press release that Microsoft has up on their website:
“The ‘last ad clicked’ is an outdated and flawed approach because it essentially ignores all prior interactions the consumer has with a marketer’s message,” said Brian McAndrews, senior vice president of the Advertiser & Publisher Solutions (APS) Division at Microsoft. “Our Engagement Mapping approach conveys how each ad exposure — whether display, rich media or search, seen multiple times on multiple sites and across many channels — influenced an eventual purchase. We believe it represents a quantum leap for advertisers and publishers who are seeking to maximize their online spends.”
Think about how many ad impressions you may see of a particular brand/campaign. If you see one on television, one in the newspaper in the morning, one in your RSS reader when checking the news, and then another in search, and you click on the search link… should search get 100% of the attribution? No, however, how do you assign attribution back to television, print, rss, and search? This is what MSFT and a whole bunch of other smart people are trying to figure out.
TechCrunch rightly so points out that MSFT was vague on details about this announcement. We all talk about engagement and metrics surrounding how our media teams should buy/sell inventory; but it’s going to take more than just one study and one vendor. We all know that some of the metrics we use each day are flawed for certain types of buys (CTR for awareness campaigns?) - but it’s what we’ve been using for the last 10 years or so, but shouldn’t be the reason we continue to use them.
The digital world is dynamic and using metrics set in the 90s may not be valid for today. While we may be able to move quickly and adapt, can the rest of the market and the rest of the world? Some shops don’t even have digital capabilities yet….
I’m extremely interested in this.
02/23
2008
Monetization of Ad Inventory
Roger raises an important issue when it comes to assessing company valuations and inventory: how much of it is monetizable? This is an extremely important question and often gets answered by the associate or general partner of a venture firm who is building the financial model for the startup they are looking at investing in or the M&A team who is looking to acquire an ad-supported startup.
One of the top concerns of mine and I’ve been through it first hand: when venture capitalists or corporate development teams are working through a financial model to figure out how much your inventory is worth, I can almost guarantee not one of them has ever spent any time in an ad agency (on the media team) or in marketing at a brand. I’d imagine over 90% of all VC’s or M&A folks come from finance, engineering, or similar backgrounds.
This is a problem (there is always a solution to any problem) when it comes to monetizing the web. We like to think that just because Facebook delivered over 12 billion pageviews in January 2008 (ComScore), they are able to monetize all 12 billion. Unfortunately, that is not and most often never the case. Case in point: Yahoo sells out the homepage of their site, but I know first hand that they have quite a bit of inventory that goes unsold on other areas of their network. Trying to buy a Yahoo! home page though is quite expensive and is sold out for weeks at a time.
There are a few important reasons (amongst many others) why any company who sells advertising on their website may have unsold inventory (startup, emerging company, or world renown):
1. Ad sales team is not effective. Tough to find, attract, and maintain a top-notch sales team in any industry.
2. Depending on the size of a company, a sales team can only cover so much geographical territory. For every territory not covered, money is being left on the table.
3. The ad marketplace (agencies and/or brands) may not want to purchase the inventory available for a host of different reasons.
4. The business environment is not conducive to ad spending at this time.
Most startups that I’ve had the chance to work with like to deploy a direct sales strategy first and sell all of the high-level integrations (longer sales cycle but more expensive buys) and then outsource standard inventory (IAB) to ad networks, rep companies, and participate on advertising exchanges.
With so many advertising supported (either fully or partially) startups in the market, the networks and exchanges are growing at an increasing rate. My guess is that the amount of inventory available to advertising networks is outpacing the additional advertising dollars available so the % of monetization of inventory is decreasing on a month-to-month basis. If there is a downturn in the economy, this will surely affect the sell thru and the % of monetization will decline rapidly.
Most of the purse strings of advertising budgets are held by ad agencies. Yes, ultimately, brands sign-off on any plans, but agencies are doing a lot of the work to make strategic and tactical recommendations as to where to spend the brands money.
There are many types of agencies who spend their money digitally:
1. Interactive (only) shop
2. Performance marketing (direct) shop that has a digital capacity
3. Fully integrated agency (digital, print, OOH, television, etc)
4. Others..
The way that each of these agencies looks at the digital environment may be very different from one another. A fully integrated agency may not be looking at performance driven marketing (CPA type stuff) whilst an Interactive shop may not want to amplify what the brand is doing offline into the online world. These are just examples and may or may not hold true for any and all of the agencies.
The bulk of the premium inventory on many websites are being sold to Interactive and Integrated agencies as they are the most creative and high-impact. Beyond this, agencies may purchase inventory from ad networks to add reach (or hit certain goals) and in some (increasing) cases, ad exchanges, though compared to the larger pie, small [today].
Just because you have 12 billion page views, should you be worth $XXCPM * 12 billion/1000 * XX months? (or whatever the valuation equation is?) I’d also like to see some marketing gurus head into the finance world, that way, we can add some context to the valuations occurring today. The majority of sites will not monetize 100% of their traffic 100% of the time. Please remember to keep this in mind.
One other thing to keep in mind:
1. Not all agencies pay the same rate
2. Rates are different depending upon the category vertical, time of year, etc.
3. Most major buying firms are paying well below rate card
02/23
2008
Imagine It Project @ Stanford University
I came across the videos of the Imagine It Project @ Stanford University and have to say that it’s a great compilation of students from around the globe and seasoned entrepreneurs/executives. If you’ve got a spare 30-45 minutes, certainly check out a few of the clips over at ImagineItProject.
Students were tasked with creating value from an already existing and popular product. I think it is safe to assume that P&G, Unilever, Coca Cola, Pepsi, Heinz, and other mainstream consumer products/food companies were secretly recruiting at the event.
Category: Startup & Venture Capital
02/21
2008
links for 2008-02-21
-
Some great shirts… funny
-
Agreed. I wish more people understood this.
-
Exciting. I want to guest lecture here. Anyone know any teachers?
-
I’ve gotten quite a few phone calls from VCs since I’ve started over at The Media Kitchen asking about potential deals. These are the smart ones.
-
This doesn’t just pertain to the music world.
-
It was only a matter of time until someone did it. I can now see a significant play between Google and 23andMe
-
What is considered taboo?
-
But whether 2008 is the year or 2009, expect everything to change in BT, and ISPs will be at the center of that revolution.
-
Look at the DAU statistics. A fairly large drop off out of the top 2, but significant in itself.
-
Daily reach of top social networks, installs vs. active apps, etc.
Category: Links
