Category Archives: Internet & Web X.0

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

Big Ideas vs. Distance (My Dilemma)

Ideation Dilemna

Anyone else have this dilemma?  What do you do to overcome it?

I always love traveling or working in remote coffee shops because that’s where my mind frees up.

IGA Worldwide was a brain fart of mine when I was walking thru the woods in Saratoga Springs.

Tomzy was ideated when Sherri and I was traveling to a beach location.

I spent a lot of time working on Varick Media Management while working at the Muddy Cup in New Paltz, NY.

rdcrpt: bringing ideas to early adopters

I’m totally opening my kimono on this idea.  I believe that your [collective] feedback early in the process will help shape and guide where this idea goes (if anywhere).  And by the way, I’m committing to investing a bit to test the idea out (which I think is very feasible).

The inspiration for this idea came from my forthcoming launch of Tomzy and the opportunities that exist within alpha/beta testing, stress testing, initial publicity and feedback, and for a myriad of other reasons.

Here are my notes – please comment, tweet, or email me your comments, would love to hear them.

rdcrpt helps companies test and launch new products thru an exclusive network of innovators and early adopters

The closest company I can find to delivering this experience is InviteShare which is now owned by TechCrunch.

A very quick summation of rdcrpt:  I envision rdcrpt as a place where innovators and early adopters can go (rdcrpt.co) to sign up to participate in alpha/beta testing some of the latest services and products from startups and established companies.    In exchange for getting early alpha/beta access, folks on the rdcrpt would be responsible for providing valuable feedback and would be rated on such.

The value prop for publishers/companies would be to test new ideas and products with a set of hungry adopters.  This could be the equivalent of a typical “beta-invite-only-launch” or more of a R&D experiment.  Companies would gain valuable feedback from these testers based on the criteria that they select.

rdcrpt is targeted at the 2.5% of innovators and 13.5% of early adopters per the chart below which appeared on Mark Suster’s blog this morning about How to Acquire Customers by Marketing “Heroes” as well, as, numerous times on this blog as well.


Helps deliver:
QA team scale/issues
Stress/Load level testing
Initial publicity

Value Prop for Startups
Opprty for startups in alpha/beta to launch to a subset of users
Startups can invite the rdcrpt user base and/or use their own list
Receive feedback regarding user experience, design, technical details, etc

Value Prop for Consumers
Get access to latest startups ahead or alongside of everyone else
Be part of the experience in testing apps, sites, hardware, etc
Provide valuable feedback to startups about their products

Value Prop for Investors
Be able to see demand for the startups via a rdcrpt demand meter (invites/day/hr requested)
Be able to see aggregate sentiment for startups via feedback
Ability to see where/what innovation is happening

Rdcrpt Crowd
Early adopters, type A
Publicly ranked by activity (acceptance to programs, participation, social influence)

Monetization
Startups can launch to all of rdcrpt for flat fee
Startups can handpick people based on rdcrpt rank (higher the rank, costs more)
Investors can subscribe to get access to rdcrpt reports on companies
Rdcrpt can create a media network which allows rdcrpt users to distribute product interaction videos which would get promoted/sponsored

Hurdles
Chicken/Egg scenario: startups or rdcrpt crowd comes first
Attracting the rdcrpt crowd
Maintaining the rdcrpt crowd over time

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.

Silicon Alley Tees Off

I’m all about getting really smart people together and talking about the goings-on in the industry (digital media).  I’ve been hosting a private golf outing for the past 3 years and changing things up a bit… read below:

Silicon Alley Tees Off
Premier Networking & Golf Invitational Tees Off on August 4

Contact:  Darren Herman
Email:  dherman at media kitchen dot tv
Twitter:  @dherman76

July 20, 2010 – (New York, NY) – The Silicon Alley Golf Invitational is set to tee off on August 4th, 2010 at Centennial Golf Club in Carmel, NY with over 30 NY based senior executives registered to play from leading venture capital, private equity, startups, digital media, and advertising & marketing services organizations.  Participants of the tournament will be playing for prizes for “Best Score,” “Worst Score,” “Closest to the Pin,” and “Longest Drive.”

“This event is a culmination of 3 years of holding private golf events for my tech/finance friends in the New York scene,” says organizer and The Media Kitchen’s (& kbs+p) Chief Digital Media Officer, Darren Herman.  “We are hoping to turn Carmel, NY into a miniature Allen & Company Sun Valley Conference for the day; as with years past, I expect lots of [business] conversation on the course and during the luncheon following the 18 holes.”

The Silicon Alley Golf Invitational is being supported by Silicon Alley companies’ AdCopy, TraffIQ, The Media Kitchen (a kbs+p company), and Varick Media Management.

The Silicon Alley Golf Invitational is not being run as a for-profit entity and all monies from sponsors and players are going into the actual execution of the event.  Any money over and above the cost of the event will be donated to charity, which is selected by the players at the event.

For additional information, please head to the official website: http://www.siliconalleygolfinvitational.com

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The Closed Trend: Email Newsletters

closed-signOne of my friends, Sam Lessin, created a service called letter.ly, which allows anyone to sign up for a email newsletter account and charge users whatever they want to join.  An example of this is Michael Galpert’s newsletter of which he charges $4.00/mo.

Recently, Jason Calcannis and Sam Lessin declared their blogs dead and are moving to email communications because it’s more intimate.  I receive Jason’s email newsletter and find nothing in there that couldn’t/shouldn’t be on his blog.

I find it funny how everything old is new again.  Note, these 2 people are not a statistically significant sample but being that these two men are at the center of the tech scene, it may be a directional indicator of where things are headed.

Nate’s post entitled Going Premium talks about how he’ll write in-detail about things not fit for mass public consumption (his blog).  Sam also talks about how an email newsletter allows him to talk about things more interesting things.

I don’t know if I subscribe to the whole notion of “stop blogging, start a premium newsletter.”

I think each of them have their place as a communications vehicle but I would guess, right now, without much experience writing email newsletters that being open rather than closed would deliver a lot more value which is the antithesis of what Sam talks about in his blog post.

An interesting thing did happen though.  Since I’m paying for this content now, I do hold a higher standard for it.  In an email exchange I had with one of the guys mentioned above, I told him that he better deliver “significant value” since my wallet is open.  Being that I’m now paying for this content, I may be more likely to cancel my subscription than to take his previous [free] content out of my RSS Reader or my alpha version of Tomzy.

I’ve been wrong many more times than being right, so take this all with a grain of salt.

Would love to hear your feedback.

This post was written by Darren Herman (@dherman76) who is the Chief Digital Media Officer ofkbs+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.

The Advertising Collision

This post was inspired by Fred Wilson’s post today and Chris Dixon’s post back in 2009 about online advertising and it’s potential share gains.

Quite simply, Chris outlines that there are two types of advertising:  brand advertising (ATL= above the line) and direct response (BTL=below the line).  Much of the ad dollars have historically been centered in ATL media which is understandable but something big is happening.

A major collision.

ATL mediums are becoming BTL mediums.  BTL mediums are becoming ATL mediums.  There is no such medium that is one OR the other… both mediums are working together.

This is very important to understand.

Display, search, mobile, social, television, print, radio, ooh, and all others can be used for any format and are not mutually exclusive to the types of messaging you choose to use.  We like to call it branded-response, but I’m sure every agency around town has their own name for it.

Now that we can measure to some extent, the traditionally measurement-untouched ivory tower media channels dollar allocations will start to be reallocated to more measurable channels.  Or alternatively, as the ivory tower media channels become digital ivory tower channels, they in themselves will become measurable and will receive a dollar allocation based on their contribution to the brands marketing performance.

Companies like Vizu are releasing products that allow marketers and their agencies to optimize to campaign lift (awareness, consideration, etc).  Traditionally, most digital optimizations happen for a KPI that is quantitative (click, transaction, etc) but now we can optimize to emotion.  This is an example of startups looking at the future and innovating early.

It’s early in this game, but take note of this collision as it is going to create some amazing opportunities for the industry.

Financial War: The Nimble vs. the Titans

A much smarter man than I said that competing with big companies is much easier than small companies.  Big companies are hard to pivot and change; so they either acquire you (good for investors) or you bring them down.  Actually, he said that today at the TechCrunch Disrupt Conference today in New York City.  His name, Michael Bloomberg.

Bloomberg is a trifecta for this post:  his quote, his background in finance, and his track record as an entrepreneur.

In the office, I’m responsible for digital marketing strategies for a few financial companies (no conflicts) that we’ve all heard of.  But a funny thing is happening on the way to the office.  Thru email and through introductions, I’m being introduced to about a half dozen startups that are tackling the financial sector.

Now is the perfect time.

You do not need to read another rant about Wall Street, as I’ll leave that to more financially-minded folks than myself.

When in a fight, you want to knock your opponent down when he’s hurt.  The bigger they are, the harder they fall.  During a professional boxing match, the fighters are trained to wait/observe for weakness and then attack.

Right now, banks are hurt and they are ginormous.  It’s the perfect time to go after them and attack.

2 financial companies are presenting at the Disrupt conference this week:  Plantly and Betterment (I’m assuming a play off the words “better investment”).  The third made press waves last week and is called Banksimple.  There’s even a fourth that I’m seeing ads for:  Ally Bank.

I don’t know the intricacies of each of their business plans, but they are certainly positioning themselves in a market where the nimble can out maneuver the biggies.  Also, being big these days in finance may not resonate with consumers so well.

This is an area that I’m watching.  If you are part of the senior team at any of these companies (or others), I’d love to chat.

Crunchbase Profile:  Plantly
Crunchbase Profile:  Betterment
Crunchbase Profile:  Banksimple

SEO for Television

A short and sweet thought inspired by Mark Cuban‘s latest posting on Google TV.

If we are finally in the early days of television/digital convergence, then Google is going to want to leverage their PageRank (probably needs a new name) algorithm to help TV viewers find content.

If you are thinking of getting into SEO, figuring out how TV will play a role will be extremely important; after all, there are $70 billion dollars in the US alone of TV advertising.

This is certainly an interesting area for entrepreneurial opportunity, investment, and understanding.