Category Archives: Advertising & Marketing

Why I've Unsubscribed from Deal a Day Services

Image representing Groupon as depicted in Crun...
Image via CrunchBase

This post shouldn’t come across as another “I’ve quit [replace with service] because [xyz].”  There have been way too many of those type of posts and I don’t want to be another log on the fire.

I’m in the process of unsubscribing from the Groupons of this world because in aggregate they send me way too many offers that are not relevant to me and the value they do deliver to me does not outweigh the disservice of cleaning out my inbox.

Note: by Groupons of this world, I mean LivingSocial, BuywithMe, SocialSteals, DealOn, and others.

In a world of customization and personalization, you would think that these services would employ Hunch-like personalization.  Currently, they are no different than old school offers delivered thru digital vehicles.  As a consumer, I almost expect customized coupons in 2010.  I’d rather not receive a coupon if it’s not relevant to me.   Heck, even the television commercials on ESPN are more relevant.

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The Great CTR Debate

I often have conversations with clients about what their key performance indicators should be for their campaigns.  Quite a few times, clients want to use the CTR as the main proxy for performance and I squirm.  While I can talk for hours about why this is not a good idea 99% of the time, I wanted to hear the voice of the industry talk about it.

I asked a few friends to write a a few sentences about the famous “click thru rate” and if it should die or not.

While this is August 2010, the debate has been around for the past ten years.  I uncovered an article on CNET from 2001 entitled “Is the click-through history?

The Click Thru Rate Debate

I’m sure you have opinions and would love to hear them.  Please leave a comment on the blog or use the hashtag #deathofctr on twitter and tweet me at @dherman76

It's Not About Price, But Much More About Ease

The cable vs. television war is not about price (IMHO), but more about ease of use.  Though someone could argue that there is a usability curve that can be overlaid across ease of use (we pay more for simpler, pay less for complex).  Cable is mature and has worked through the majority of the usability kinks in it’s product, thus, consumers find it easy to use.  We pay a premium for this.

Early in 2010, we created a document at The Media Kitchen called Cable Cutters.  We posted this on Slideshare for all to see.  The document outlined the options that consumers have to “cut their cords” and skip using a traditional cable box.  There is a growing community of people doing this and it’s something that if you are a television advertiser, you probably want to study.

I was reading the NY Times this morning while on vacation and saw The Sofa Wars article and In The Living Room, Hooked on TV.  These obviously triggered this post.  I also thought back to the Mark Cuban vs. Avner Ronen debate during SXSW.

It’s simply too damn difficult for the majority of people to leave cable and get the same or similar channels…. today.  Even if the hardware/software was free, it’s too complex to setup and use time and time again.

What this looks like tomorrow is not-known but there are billions of dollars invested in this cable infrastructure, billions of more dollars in media contracts, and SAG rights that are still in flux re: digital.  This will evolve.. but not as fast as we’d like.

Anderson’s post re: the Internet is Dead would mean that we don’t need a browser to watch our favorite shows… they would appear directly on our television set.   I can’t wait for this… and open up the potentially millions of channels.

If this is the case, what becomes the TV Guide for next generation television?  Is is companies like Milabra or Affine Systems who do image recognition?  Or is it meta-tagging companies who trigger off of structured data?

I covered all different areas in this post and wasn’t as structured as I like… but hopefully it spurred some thoughts.  Please leave comments on the blog or thru Twitter (@dherman76).

Talent Needs: Job Opportunities

One of the most amazing things about starting a business is being able to provide career opportunities for people at all stages of their life.  I’ve listed a few opportunities below and if  you or someone you know is interested in one of these, please do not hesitate to reach out.  The company is Varick Media Management which is the demand side platform and infrastructure for MDC Partners agencies and brands directly.  The team is located at 160 Varick Street in New York City.  I will refer all qualified candidates to the HR coordinator and the respective designee at VMM.

Investment Manager (Top Line Revenue Growth Driver):  Looking for someone with 1-3 years of experience to evangelize and drive top line growth of VMM to agencies and brands.  We are looking for someone who has experience in making the complex very simple; someone who is extremely personable; and who can present themselves well to a group.  Compensation is based off of a package of competitive base salary + performance + benefits.  If you are interested, please contact me.

Chief Marketing Officer (Strategic Sales):  We are looking for someone with 10-25 years in the business who has sold into strategic accounts ($10MM+/yr) for the past 5+ years.  Will be responsible for driving the direction of the Strategic Accounts as well, as, overall company marketing and identity.  Candidate may have an immediate open-to-hire for junior marketing coordinator to help with internal and external marketing efforts.  Responsibilities will be to drive top line revenue growth for the direct to brand channel and will have a new client goal quota.  Re-iterating that this person will be responsible for targeting specific clients (directly) and signing a specific number each year. Compensation is based off of a package of competitive base salary + performance + benefits.  If you are interested, please contact me.  Looking for someone who has played a similar role at former ad agencies, research firms, ad networks, and top tier publishers.

Infographer: We are looking for someone who is a master of data manipulation and visualization.  We’d like to bring someone on board who can tell stories once given a data set.  The ideal candidate will be able to recognize patterns within data, illustrate complex scenarios in simplistic forms, and create visuals that are easy to comprehend.  Visuals will be used both internally and also sent to clients to illustrate a particular problem or solution.  This role with support marketing, account, trading, and investment management.  Compensation is based off of a package of competitive base salary + performance + benefits.  If you are interested, please contact me.   Ideal background would be a mathematician + design.

VP Client Services (title to be figured out): We are looking for someone who wants to run the Client Services team and work closely with Investment Management.  Should have 10+ years experience within market research firms, agency brand planning or account management, or account management at complex advertising technology solution houses (ad networks, exchanges, etc).  Must be unbelievably personable, academic curiosity, a born leader, and detail oriented. If you are interested, please contact me.

Brand Capital & The Consiglieri

These guys get it and are for real.  I’ve known Mike Duda (@mikeduda) for a few years now and he’s onto something.  Let me explain why I think they have an opportunity to help create a new type of investor class that adds real strategic value.

The Front Man

Who doesn’t want to take a phone call from a player who has been a 2X NBA league MVP and 7x NBA All-Star?  Think you can get a meeting with someone?  I’m going to bet that Steve Nash can open more doors than the above average biz/corp dev person.  If you are one of his portfolio companies, Nash should be able to open the door anywhere.   For the sheer fun of it, I’d take a meeting with Mr. Nash and let him tell me about any of his portfolio companies.  Recently, WFAN 660AM took me out to breakfast with Boomer Esiason… a future hall of fame NFL QB.  That was awesome though the conversation wasn’t.  While the reporters loved Nash’s internship at Deutsch, I promise you that he’s not going to be sitting in the office working on campaign slogans… that’s the ad-mans turf.

The Ad Man

For those of you who are not familiar with Deutsch, it’s one of the top integrated shops left on Madison Avenue.  My agency, kbs+p is often compared to it and even Mike worked there back in the 90s.  Buddy Mike was one of the youngest partners ever at Deutsch and was directly responsible for some of their largest business including running the Anheuser-Busch InBev and Under Armour acccounts.  Duda also launched some businesses for Deutsch to much success and is highly regarded as one of the industries top ad-men operators.

Why Take Their Money?

In these frothy capital-rich (crazy to say that in a recession) days where it seems everyone is opening a seed/venture fund, the actual money to invest is just the table stakes.  What separates early stage investors from one another is the network that they keep and the value that they can add from a strategic and tactical planning perspective.  Many major early stage investors have been technical guys who were either product managers or startup CEOs that made it big… but I rarely, if there is even anyone out there, see people coming at it from a marketing angle.  Steve Nash has built his own brand which is world renown and Mike has built up multibillion dollar brands.  Startups need to understand how important their own brand is when talking to the world as it affects every conversation that they are having with consumers, investors, acquisitors, and potentials.

If you look at all the companies who get hyped on TechCrunch, TechMeme, GigaOM, AlleyInsider, and others, more times than not, their brand stands out.  Goodwill counts.

A Serious Bet

While GigaOM posted about another celebrity moving into tech with weak results, I see this celebrity having an awesome sidekick in Duda.  The area that I’d love to see them fill out is on the investing front end and they will have a nicely well rounded team.  Lets revisit this post in 365 days from now and see where they are… but want to send the boys’ Duda and Nash my most sincerest regards and best wishes!

Note:  I’m not an investor in their fund or currently working with them in any capacity.  I’m just excited to see some innovation in the space I love:  Marketing and Investments

Data Driven Platforms: Search & Display

Using data to make better business decisions is nothing new but since 2008, it’s been a very hot topic.  It’s been covered in almost every issue of Advertising Age, a whole new web destination now exists: AdExchanger, and agencies spun up new trading desks that are essentially high powered SWAT teams that combine rich data-sets with media for exceptional results.

Google has built a $154 billion company based on the use of lots of data to make the right decisions for it’s advertisers.  The data sets that Google are using are based off of search queries, which one can argue is one of the most powerful data sets that exist as it’s pure “hand raising.”  Over the past ten years, the big search engines have integrated with search engine marketing platforms such as Marin and Kenshoo to provide access to that marketers and agencies can use these tools to make better decisions which should improve performance and create workflow efficiencies (amongst many other reasons).

The trend we are going to see in 2H2010 and certainly in FY2011 is the emergence of these tools within the display, video, and mobile world and combining SEM with them.  While I can’t speak for any one tool directly due to confidentiality reasons, we are going to see many of these once SEM-only players move upstream to capture additional ad dollars and to use all-data (search+display+video+mobile, etc) to make better decisions.

As illustrated below, agencies such as Efficient Frontier are moving into this space as well, as well as, tools/platforms are integrating into biddable display sources.  These are not the only companies moving into the space but are illustrative of the trend.

What does this mean for the standalone display side platforms?  For the standalone SEM platforms?

An operational hurdle that will have to be addressed within the media agency world is that search and display is generally bought from two separate groups so either a) these groups will need to be combined or b) we need to provide clear roles and rules for each group.  I think option (a) is a much better choice as I’m all for integration.

SEM Platforms

Design, Development and Flipboard

If you touch the digital media industry in anyway, over the past 48 hours, you probably heard about Flipboard.  Techmeme has tons of coverage on it this morning as folks like Stowe Boyd, Gizmodo, and Robert Scoble are discussing whether or not it’s legal.

I first heard about the App while I was sitting in a meeting with a friend at First Round Capital and he pulled out his iPad and showed me the App.  The app immediately reminded me of a magazine but with a multi-dimensional and unique experience.

What Flipboard nailed was the design.

We’re not “ooo-ing” and “aaaah-ing” because Flipboard is technically amazing which we’ve learned is far from the truth, but what we are interested in is the form over function (or at least a balance of).

Ever since software was built, we’ve [passively] lowered our standards of design to accommodate for function.  Function has been more important to us than the aesthetic because at the end of the day, we need to deliver a result and if the function can’t do that, then we will come up empty.

The earliest of people who gravitated towards the technical fields weren’t designers but they were developers.  I’m guessing there still are a lot more left brain folks in the industry than right brainers but anytime we see integrated design & development, we take notice.

One of the easiest things to do to make yourself standout within the digital world is to hit a homerun with the design and experience.  If you invest significantly in this area, then you are going to standout from all the rest.

Flipboard gets it… and by the way, they are from Stanford University, a notoriously left brain school.

The Conflict Free Ad Exchange

Picture 9Today’s ad exchange landscape is fairly complex but most people know who the big players are:  Google’s AdX, Yahoo!’s RMX, Pubmatic, Adnexus, Admeld’s MeldX, Adsdaq, Adbrite, and maybe, Microsoft AdECN.

With the majority of the above players including the big two (AdX, RMX), there is a major conflict.  They also sell media.

It’s like the Nasdaq also selling/providing liquidity for their shareholders.  Isn’t this a conflict of interest?

I know it’s early days within this space and most people are gravitating to where the money is.  For good reason.   Keeping the lights on and making a market today is better than being out of business in 12 months with only a dream.

When will we see a truly independent ad exchange emerge that can generate enough revenue to actually make it an attractive business for some group to start?  Behind closed doors, we talk about this all the time but everyone would rather be Goldman Sachs than the actual plumbing/exchange itself.  … and potentially for good reason.

I’d like to see a conflict free exchange emerge.  I’m sure many others would to.

Tangentially related posts:

This post was written by Darren Herman (@dherman76) who is the Chief Digital Media Officer of kbs+p/The Media Kitchen and the founder of Varick Media Management.  This post represents personal opinions and views, not necessarily reflected of his employer.

Insurgent: How to take down Dart and Atlas

Maybe the title of the post is hyperbolic but at least this idea could put a big dent in their agency revenues.

Note: these are my thoughts, not necessarily reflected of my employer.

We talk about agencies having a digital backbone. Yet, for the most part, the technologies are licensed. For today’s and yesterdays reasoning, this made somewhat sense. Moving forward, I think I lie on the other side of the fence and could argue that agencies or their holding co., should own/operate their infrastructure.

For todays post, let’s focus on the most essential part: the ad server and data store.

I’m skeptical of Google and MSFT, specifically with the hundreds of billions of impressions they serve collectively. It would make sense that every campaign served thru them would make them smarter. Hey Toyota, did you know that your campaign for the Toyota Camry just made Honda’s campaign for the Accord much smarter?

There is the above issue and now an important one. MSFT and GOOG can see every advertisers campaign that uses their system including cpms, impressions, conversions, etc. Being that MSFT and GOOG sell media too, they have a huge advantage if they were to use that data in the way they pitch us and price us.

Google has the ability to do the above in search extremely easily thru Google Analytics. They know every search term leading to our site and can price appropriately.

I’m not saying that MSFT and GOOG are doing any and all above but its certainly an opportunity for them.

In talking with one of the other holding company execs, he mentioned to me that we need to rethink our competition and Google is a serious threat to Madison Ave.

So I have outlined a few reasons above that we (as agencies) should be scared of our partners or frienemies. Now, let’s focus on why having this technology structure in house makes sense.

Every ad served today in display, search, rich media, online video and others puts off data exhaust. Some of this is extremely relevant for clients/campaigns and some useless. However, a good team with the data within the walls of the agency/holding co (ie like Varick Media) can reap tremendous benefits. Also, the data from within holding co or agency walls can become a friendly co-op and can become a major new business strategic advantage.

Think of tmorrows data exhaust when most media is served and tracked with a digital backbone.

While every media company out there wants to service as many advertisers as possible, different agencies have different relationships with different media companies and the opportunities brought forth vary. If agencies controlled their ad server, they could build custom integrations wit certain (not all) publishers that provide opportunities beyond where the market is today.

Ad servers will quickly morph into planning tools as well. Within the agency is where this needs to Iive. Once television ads gets served and tracked, planning will be forced into these systems (because of the sheer dollars chasing) and every agency planning team will want their own customizations. We have some tools like Quantcast that help with audience planning but imagine a custom tool of Quantcast-times-ten on the desks of all the agency staffers.

Agencies and holding companies will have to continue to differentiate and if we wanted to put a dent into Google/MSFT, then MDC, IPG, Omnicom, WPP (first mover with 24/7), Publicis, and Havas should be certainly thinking in this direction. The writing is on the wall.

The argument will be made to say that agencies cant run technology companies which i’ve publicly aligned with that in the past, but I’m going to argue it and say… Go and hire the right people. If we don’t, someone else will.

Big Companies Can Be Fun & Educating Too

I’ve spent more time in my working career in venture backed startups of less than 100 people than in companies of hundreds.  But for the past few years, I’ve worked in a mature organization of hundreds of employees, positioned in the marketing & technology services business.

One of the invisible badges that people are starting to wear in NYC (similar to Silicon Valley) is a “startup badge.”  The “in” thing to do is to work in a startup.   And there are many good reasons for that of which I won’t go into but on any given day, Charlie, Fred, Chris, Roger, and others are evangelizing (sometimes even myself!).

I’m going to play the contrarian tonight and say that while startups are fun and educational rollercoasters, there are many mature companies here in New York that have great opportunities.  Take a deep breathe and hear me out.

There are many stereotypes of working within a mature organization:

  • Lots of politics
  • Talent gaps (warm body syndrome)
  • Lack of creativity around compensation
  • Slow to move

You get the idea.

First:  do your due diligence and stay away from these.  If you can’t research companies and know how they operate before or during your interview process, you deserve to be in one of the above stereotypical companies.

While these stereotypes are for good reason in many cases, there are many reasons to join a mature organization in your young career, mid career, and/or executive career.

While each career stage has pros/cons and I don’t have the time to go into each and every one of them, I will highlight some things I’ve found over the past 2.5 years to be extremely helpful beyond early stage startups.

  1. Talent:  If you are into reading books, especially non-fiction business books, it’s fairly easy to align yourself with some of the authors you might love.  In the advertising industry it’s especially easy since it seems that every major advertising guru has written a book.  If there is a story/book you love and the person is still working, go work for them, you can learn a lot…
  2. Infrastructure:  Bigger companies generally have the resources to subscribe to services that normal startups can’t.  How many early startups do you know that subscribe to Nielsen, Comscore, MRI, Simmons, etc?  Access to these services can inspire big and new ideas which maybe is what you tackle down the road with a future startup.
  3. Compensation:  Spend less time worrying about if you are getting paid and more time solving strategic and tactical issues and opportunities.  How many pay-periods has your startup missed and what types of issues has this created?
  4. Access to Senior “People”:  The “people” is in quotes as it could mean a lot of different things such as clients, holding company execs, Wall Street, etc.  Big Companies generally have extremely tight relationships with very senior clients and exposure to them to learn about how they think, operate, and make decisions is priceless.
  5. Resource:  If you are in a company who has some free cash flow or wants to invest in a certain project or idea, it’s much easier to pull off in a larger company.

While the 5 reasons above are not bulletproof nor complete, big companies (mature) can provide a great opportunity for many in the advertising, media, and technology ecosystems.  While you don’t have to spend your entire career within a mature entity, there are many reasons to get your feet wet and to dive a little deep which could really benefit any startup you might build.

While startups are sexy, don’t underestimate the power of working for/with a mature entity.