Category Archives: Advertising & Marketing

2011 Silicon Alley Golf Invitational

It’s that time of year again… an excuse to leave the office for a day and play a round of 18 holes with some of the top founders, investors, and supporting cast of the digital media ecosystem.  It’s time for the Silicon Alley Golf Invitational.  While I’ve personally held this event for a bunch of years now for a smaller group, last year is the first year where I opened it up a bit and went from 12 to 40 players.  This year, I’m expecting about 60-70 players based on the amount of positive response so far.  We even had some coverage in the Wall Street Journal, Business Insider, and NY Convergence, last year.

This year, we’re doing much of the same though switching the course, adding additional players, and maybe a few new prizes.

If you would like to play and can hold your own on the golf course, or would like to come up for the outside BBQ luncheon & awards ceremony, and you are a solid member of the Silicon Alley ecosystem, please fill out this form.  Due to space restrictions, we cannot accomodate everyone but will add an additional 5-15 people over the next month or so once I get a better grasp on RSVPs.

The date is July 18 and location is a country club in Westchester County.

The hashtag for the Silicon Alley Golf Invitational is #SAGI11

The Innovation Equation

I attended a talk at the Summit Series led by Chip Conley, the author of PEAK (and various books) and founder/CEO of Joie de Vivre.  Here’s his TED talk.  Over the past 25 years, he’s studied many different emotions and has broken them down into equations.  An example of this is:  DESPAIR = SUFFERING – MEANING

I’m working on a presentation about Innovation.  I’d like to break down the word innovation into an equation as inspired by Chip.

Here’s my stab at it:  Innovation = Execution + Evolution + Inspiration

What are your thoughts?  Is this equation good?  Did I miss anything?

Ari Gold & Moneyball Theory

I’ve always been fascinated with how talent agencies operate.  Back 4 years ago, I wrote about creating a Talent Agency for video game athletes. The idea of a “Talent Agent” is sexy to me because they get to identify and grow people.  In some ways, I do this for early stage technology, as both an investor and advertising agency executive.

While I’ve not walked the halls of Creative Artists Agency or William Morris Agency in quite some time, though I did back in 2001-2003 when I had a music company, I would hope that they are investing in tools and capabilities to digitally mine petabytes of data to identify the next Justin Bieber or Lady Gaga.  I’d argue it’s all in the data, similar to Moneyball, and finding the next big franchise requires servers, algorithms, formulas, and a few quants.

The story of Bieber is told almost every day now – his mother uploaded videos of him to YouTube playing various instruments and they started gaining momentum… and was found by a music industry exec and ultimately signed to a big deal. Now he’s a huge pop star sensation and a true early stage success story.

But what interests me is less about the star herself, but the tools and resources necessary to identify the potential star.

Lets start with YouTube since we spoke about it above and it’s the lowest hanging fruit.  With billions of views and hundreds of millions of viewers, the data that YouTube has on video viewership is tremendous.  Are there any companies who have built platforms on top of YouTube that allow the big (or small) talent houses to be alerted when videos are catching fire (or going “viral”) or the ability to track certain upcoming artists for their views and ratings?  If CAA or WMA wasn’t doing this, it’s almost negligent.

Could CAA or WMA be one of the largest purchaser or subscriber of the bit.ly database?   I’d hope so.

But digital doesn’t just start and stop with YouTube.  What if you could take all the YouTube output from above and cross reference that with Google Insights for Search: and examine all the trend volume around specific artists or videos.  By doing this, you get a linguistic and geographic context to the output.   Is Artist A trending in Sweden and Switzerland or just one of the above places?

Taking YouTube and adding Google Insights for Search is getting better, but what if you could layer a social media monitoring solution on top of this?  So for an A&R executive at a record label, or an artist manager at a management firm, they could not only see media hits (stories), but sentiment and momentum numbers?    There are way too many monitoring solutions in the marketplace today so I’d have to think that one or two of them have cracked the code to sell into the talent industry.

Trendrr has done some interesting things for this space as they allow the pivoting of different datasets together.  You can pivot Gaga album sales (Amazon) with Twitter followers to see if there are correlations.  A good start, especially in bringing together different databases and making them queryable.

While I’ve done virtually no research into this post about whether or not these platform(s) exist or not, it’s something that should and someone should build it.

Don't Let QR Codes Go the Way of RSS

I’ve been wrestling with QR codes lately as both a consumer and advertising agency executive.  I’m a bit scared they will go the way of RSS feeds.  Let me explain a bit.

I don’t know what to do with a QR code, and I don’t think mainstream America does either.  I’m being a little dramatic here, but you get the idea.  Do you need a specific QR reader?  Do you need to text the code somewhere?  Do you cut it out and mail it somewhere?

A QR code is a good idea – append a unique image to a print, billboard, or other campaign and entice the user to scan it in for some form of value exchange (ideally).  The brand that is using the QR code can now measure response of that particular media vehicle.

I’ve seen far too many pieces of creative that have a QR code on them, but do not have a call to action or instructions for the user to figure out what to do with it.  It’s almost like an orange RSS icon that sits next to content on the web without any instructions.   While I imagine that the “Techcrunch-crowd” knows what RSS is, I’d gather that most Americans don’t know how to setup feeds and readers and the utility and value of RSS is not being recognized fully by the masses because of this.

I’m worried that QR codes might go the way of RSS feeds. Without education to consumers about what to do with them, they are worthless – they take up space on our marketing collateral and are generally pretty ugly.

So who will educate?  Will we see the creation of a trade association to take out a broad-reaching QR awareness and education campaign?   Or, will we see brands who utilize these codes educate their audiences on their marketing collateral.

I do not know where this will net out, but it needs to be figured out.

Marketing measurement is here to stay and this is one way that we can further prove ROI.

Long Adobe (Nasdaq: ADBE)

I’m going to buy my 2 kids, David and Ava, some Adobe stock.

I figured I’d start this post with a bold statement.  Hopefully I got your attention.

Adobe is upping their game.  They historically have been a software company focused on the creative & production industry.  They could have stayed this way and built a nice business for the future.  But, someone there is leading a charge and they IMHO are spot on with where they need to go.

Adobe was rumored to have tried to acquire Invite Media in 2010.
Adobe acquired Demdex, a data management platform.
Adobe just partnered with MediaLets for mobile rich media serving.
Adobe is rumored to be now flirting with Triggit.

Adobe, while historically never spoke to agency media teams, are now building a media foundation for the future.  While being able to tie creative into metrics, analytics & media delivery, they are able to get to the future state of marketing we all talk about.

Some other companies I’m liking due to their recent acquisitions and intentions:  IBM, GSI Commerce, Marketshare Partners

Note:  All of this is predicated on whether or not Adobe or any of the above companies can deliver on the potential that each acquisition or partnership brings to the table.  We’ve all seen how acquisitions don’t work, but in theory, I like all the above.

View Thru: Undervalued Power Metric

Digital is a double edged sword, as it’s measurable.  For those who work in digital media, you understand what I’m saying.  How often have you sat there in frustration shaking your head and wondered why digital gets so much scrutiny when most other channels don’t get nearly the same precise questions from clients?  I know I have.

One of the areas that I spend a bit of time focusing on both from a media agency and investment perspective is around the valuation and understanding of the “view thru.”  For those not familiar with VT, it’s essentially a media impression that gets served (and tracked) but isn’t interacted with.  If the user visits the website (and takes action) of the advertisement within a set period of time (attribution window), the user is counted as a view-thru conversion.   This is opposite of click-thru (CT) where a user would actually click on the ad unit and go to the website.

The view thru in itself is interesting.  It’s similar to television.  You are exposed to an advertisement and over some period of time, you might make a purchasing decision in which that ad impact had some (or no) contribution.

Some marketers take 100% of VT and give it credit to a sale and others take 0%.  I’ve seen both attribution numbers and everything in the middle.  There is no “right” number, at least, right now.

While this post isn’t to argue VT vs. CT as ways to measure media, I would like to highlight how VT needs to be logged into site analytics solutions so that one can measure total effectiveness.  While Google Analytics and other tools are able to measure click based references on ad units, I’d also like to see them measure view-thru based conversions.  I can’t imagine this is easy as the site-analytics tool needs to be mapped to the ad server of record,  but this is important as generally there are 8x as many view-thru conversions for every 1x click thru.

The view thru raises questions:

  • In a world of banners and buttons, how do you create a compelling experience which doesn’t focus on the click, but rather delivers content optimized for the view-thru?
  • Do you assign equal or differentiated credit to view-thru and click-thrus?
  • How long should an attribution window be?

From an investment thesis, I’d love to look at attribution and measurement companies.  I think the view-thru is one of the most underrated measurement tools we have and with an increase in online video, VT will be a power metric to watch.

Enhanced by Zemanta

Day 5: Advertising Revenue for Startups

This post is part of a 5 day series where we lay the groundwork for a startup to generate advertising dollars from agencies or brands.  Note:  while this is focused on startups, it could apply to any company of any size.  Day 1 is located here, Day 2 is located here, Day 3 is here, Day 4 is here, and it’s based on this presentation.

Since it’s the last day of the series, I thought I’d wrap it up with a few specific points in no particular order:

  1. If you have non-traditional/non-standard units, an internal sales force will generally always work best.
  2. Treat agencies as you would venture capitalists.  While you spend so much time prepping and pitching VCs, you should take the same time prepping to pitch agencies and brands.  In our world, perception is 9/10 of reality and if you come in sloppy asking for tens of thousands of dollars, you’ll get a quick and abrupt answer, “no.”
  3. The biggest mistake I see startups making (other than #2 above) is that they price themselves too low and the perception of the value of the product gets written off.   You do not have to give anything away for free.  Brands have budgets and agencies have to invest them.  While you might give away “research” along with a media buy, you should not position your media as “free” just to earn the business.
  4. Ad units are evolving.  While I still believe that the industry will always have standardized units which will scale, there will always be “custom” units that are sexy and get lots of press.  Measuring these custom units against sales or other key performance indicators is tough.

I’m sure there are tons that I’ve missed.  Hopefully this series was a good and helpful start for startups to start generating revenue.

Enhanced by Zemanta

Day 4: Advertising Revenue for Startups

This post is part of a 5 day series where we lay the groundwork for a startup to generate advertising dollars from agencies or brands.  Note:  while this is focused on startups, it could apply to any company of any size.  The first post that sets up the series is located here, second post is located here, third post is here, and it’s based on this presentation.

If you are a publisher and you are looking to generate revenue from advertising, then read this series.

Today’s topic is on the evolution of the paid online advertising ecosystem.   Essentially, where do you (as publisher) plug in to generate revenue from myriad of sources.  Lets tackle them one by one.

On slide 11 of the presentation, it highlights 5 different areas:  Sell Side Optimizers/Platforms, Ad Networks, Google, Ad Exchanges, and DSP Integrations.

  1. Ad Networks:  As a publisher, you could contact any ad network and try and have them represent your website.  Depending on how large you are or how much publicity you have around your brand, you could potentially negotiate for better revenue spits, monthly guarantees, and potentially advance payments.   Ad Networks sometimes want exclusivity but as a publisher, make sure you get better deal terms if you agree to it.  Ad Networks are a quick way to make a few bucks with your inventory, though as an agency person, I don’t love ad networks.
  2. Google:  Technically, Google is a network and exchange, but I pull them out to their own line item because they are such a beast.  Many publishers love Google because of the simplicity around Ad Sense/Ad Words.   You could be up and running accepting Google ads within 24 hours.  Google if not already, is going to mix their search and exchange inventory to yield the highest amount to a publisher (and thus, net a high yield themselves).
  3. Ad Exchanges:  As a publisher, you can allocate all or a portion of your inventory to ad exchanges such as Ad Meld (MeldX), Right Media, Google AdX, AppNexus, ContextWeb, and a host of other platforms.  By doing so, you are opening up your inventory to be bid on by the demand side.  It’s similar to an eBay auction – where in real-time (or near real time), impressions are transacted and ads are run.  It’s rather simple to participate in this, but it’s not as simple to master it without any knowledge of the space.  Luckily, there are people like PubGears who can help you navigate it (disclosure:  I’m an advisor).
  4. Demand Side Platforms:  If you want to try and be as close as possible to the big agency dollars, then integrating with a DSP directly might be the best way to go.  While hard to get on their radar screen if you are extremely early stage and without much inventory, DSP’s are aligning themselves as close to the client dollar as possible and 2011/12 is going to be the year of direct integrations for publishers with DSP’s, bypassing intermediaries such as Exchanges.
  5. Supply Side Optimizer:  Not all above is mutually exclusive.  As a publisher, you can implement a SSO/P and plug into all of the above and have it maximize your yield.   There are a few players in this space such as Rubicon, Pubmatic, Admeld, YieldX, that all plug in and allow for yield optimization across your creative units.

All of the above opportunities are for standardized units.  These include the IAB and OPA standardizated creative.  Slide 12 & 13 talk about how you need to add data to your impressions to make them of real value to advertisers.  There are billions of impressions so how do you make them stand out… that’s by adding as much data around them as possible for advertisers to understand and buy.  This is key… otherwise, you’ll be selling your impressions for <$1.00

Stay tuned for the next Advertising Revenue for Startups post on my overall thoughts on the business and where I would start.  It’ll be the last writeup in this series.  I hope it’s been helpful.

Enhanced by Zemanta

Advertising For Startups: Does Size Matter for an Online Publisher?

This post is part of a 5 day series where we lay the groundwork for a startup to generate advertising dollars from agencies or brands.  Note:  while this is focused on startups, it could apply to any company of any size.  The first post that sets up the series is located here, second post is located here, and it’s based on this presentation.

Today’s topic is Does Size Matter?

If you are a startup or a publisher, you generally often wonder at what point can you go out selling advertising against your userbase.  Does the size of your userbase matter?

Historically, size mattered.  You needed significant size because you generally couldn’t target specific audiences so you had to sell the entire media vehicle and account for wastage.   With digital targeting, specifically audience driven media, you can now target with serious granularity.  While significant targeting delivers your audience segment, the numbers are typically much smaller than a large site-direct or ad network buy, because you are just reaching a specific user base.  For publishers who are still early in development but have a vertical or niche site, then you can begin selling ASAP because even 50,000 people who are into Ferrari’s and have $5,000,000 disposable net worth are seriously worth something to someone.  If you have a way to package your audience segments, then start selling.  You don’t need to wait until you reach 100,000,000 users to generate advertising dollars.  Implement an Audience Management Platform and you’ll be on your way.

If you have a general site (i.e. portal, aggregator, etc) and can’t really segment your users, then it might be hard to sell against until you have substantial visits.

The question comes up often about what types of creative units you should accept…   Start with the IAB Standard units because they are the most common.  Any major agency is going to create using the IAB standard package and then add custom units on top of it.  If you start here with implementing the 300X250, 160X600, etc – then you can fill those units.  Just last week, the IAB released some Rising Star units which are pretty interesting as well.

If you have unique/custom units, then these are harder to sell because agencies have to create custom creative for it (production fee implications).  Unless you have substantial size and buzz, it’s hard to sell custom units (not impossible).

On Monday, we’ll discuss the evolution of the pad online ecosystem consisting of Ad Networks, Exchanges, Site Direct, Private Exchanges, etc.  It’s a topic I love and am excited to write about it.

Advertising for Startups: Day 2

This post is part of a 5 day series where we lay the groundwork for a startup to generate advertising dollars from agencies or brands.  Note:  while this is focused on startups, it could apply to any company of any size.  The first post that sets up the series is located here and it’s based on this presentationDay 1 post is here.

Today’s topic:  Where do I start?

As a startup looking to generate advertising revenue, you have a few options on how to ramp up your initial revenue.  Keeping it simple, you can hire your own internal sales staff, outsource to a rep firm, or integrate with ad networks and exchanges.  Depending on which you choose, you will end up keeping a larger percentage of the dollars (your own sales team being the ultimate).

Based on slide 5 of the presentation, hiring your own sales staff generally proves to allow the start-up to keep the highest amount of gross revenue but isn’t the simplest to setup.  Hiring your initial sales person is one of the most important jobs you can fill at your organization.  All too often, I see startups using their first “sales” hire as a Chief Revenue Officer or SVP, Sales.  I generally am against those initial hires and would rather put someone inside of the startup who isn’t afraid to roll up their sleeves and has 3-5 years of experience within a competitive or tangentially related organization.  This way, you leave open a very senior role to fill after you’ve gotten your feet wet with your initial sales… which should impact what your senior sales job descriptions are.

Outsourcing your sales to a rep firm is an interesting option as well.  I’m generally not for this as no one knows your product better than you do, but this has worked for certain companies.  I’ve heard that Living Social is working with AppSavvy in this type of setup.  As agency person, I’m not a big fan of this because an outsourced sales rep or firm is generally working with a few different companies and when they come in and meet us, they are basically trying to sell us on everything and not everything is relevant.  It can work however.  Depending on how you structure your deal, you might pay an outsourced representative a monthly fee + commission or straight commission only.  What’s worked well for me in the past is to hire an outsourced rep in an area of the country that I didn’t have a direct sales force in.  There are quite a few reps in Detroit – as much of the automotive budgets are siloed up there because of the auto industry and these reps have great relationships.

Lastly, you can work with ad networks and ad exchanges if you have standardized units.  This is probably the easiest way to turn on the revenue spigot since it’s passive selling and there are other companies out there purchasing your inventory without any work on your part.  You can get fancy with how you optimize your networks and exchanges with SSP’s (or supply side platforms such as Rubicon, Admeld, Pubmatic, and PubGears, amongst others).  Sometimes, ad networks will guarantee you a floor in which they will sell against and potentially provide you a guarantee payment depending on how popular your startup is.  As a startup, you can use this to your benefit by shopping around to multiple ad networks or SSP’s and seeing which want your business the most by the amount of guarantee they give.  Overall, I’m not bullish on ad networks, but as a startup, they can generate some dollars for publishers generally off of the bat.

Note:  the easiest ad units to sell that have scale behind them are IAB standardized units.  While not the most unique or custom, billions of dollars are transacted in them each year and their performance is going up based on all the targeting data.  More on the data side later in the week.

Friction

Anytime there is a middleman in the middle of the advertising dollar and ultimate publisher, there is friction in the ecosystem.  The friction represents a rep, network, exchange, or some other intermediary.  To most, friction is bad, but to startups, I think most can put up with some in the short to medium term.  The rationale for this is because friction allows startups to focus… having someone else handle non-core work allows the core team to focus on what they do best:  build a product, vision, etc.  When the revenue becomes significant or it’s time in the startups life to build a larger team (Series A funding, etc), then one can remove friction.

To recap, friction is a tradeoff to focus.

To recap, we covered slides 5-8 of the presentation.

I hope you found this insightful.  We’ll focus on on “size” tomorrow.