Category Archives: Startup & Venture Capital

Data Alone Is Not A Winning Proposition

I was fortunate enough to be asked by Ari & David Goldberg to speak at their State of Style Summit which was held today at the 92st Y in Tribeca.  They threw an A+ event and the turn-out of attendees was awesome; it looked like standing room only from the stage.  Job well done, Goldbergs.

On stage, I talked about data and the application of data for marketing along with Joe Zawadzki from MediaMath and Albert Azout of Sociocast.  I was on a tangent a bit and gave the crowd a laugh with the following quote:

It got re-tweeted a lot.

Looking back at it, it is immensely important.

Data is at all of our finger tips.  When you step on the scale each morning, look at your fitbit stats, log into your account, or even review your Amex charges, you are looking at data that can then be turned into insights and then be actioned upon.

However, data alone does not mean action.  When I step on the scale in the mornings and am trending towards Alec Baldwin rather than Ryan Gosling, I’m not actioning data.   This is important.  Data alone does not make decisions.

An organization built for the next century is one who has to be able to wonk through large datasets, find insights and action them.  Just having data alone is not a winning proposition.  It’s the application of data, the extrapolation, and understanding that will lead to competitive differentiation.

If I was actioning the data from the scale, I’d not be eating this delicious chocolate chip cookie and tea from Mae Mae Cafe as I wrote this post.

Reading It Later – Content Consumption

Just over a year ago, I wrote a post talking about how I was optimizing my content consumption.  I spoke about both and Summify, both of which I continue to use.  Summify was just acquired by Twitter, which I think is a good move for them, however I hope Summify still exists to help users consume beyond Twitter content under their new management.

I’ve started using Read It Later which allows me to save any article on the web and read it at a later time on my iPad or iPhone, amongst other devices.  This is particularly useful when an article is sent to me and I can’t read it at that particular time (for whatever reason) but I save it to read while I’m commuting home or similar.  Read It Later been a great tool/app.

I still think the optimized content consumption world has a long way to go and it’s an area that I’ll continue to watch closely.  If there are any new “Summify’s” popping up, I’d certainly like to hear about them.  You can contact me on twitter or thru my webform.

Stores in an Information Society

I live in the suburbs of Manhattan and within an 8 minute drive from my home, I’m surrounded with retail stores… and there are a lot of them:  standalone, strip malls, and large malls.  Many of these stores were built when we lived in the industrial revolution society as that’s when urban planning was done for this area.

The industrial revolution is over.  Long ago.

We’re now in the information revolution.  Many things should change in this new chapter of life but the one area I’d like to highlight is the retail experience.

I’ve had many poor experiences lately in retail locations, even from stores which are supposed to have excellent in-store staff.  The more and more I go about my daily life and see how my kids are living theirs, retail stores need to adapt because consumers are now less than 3 clicks away from buying almost any item sold in any store at any time on any day.  Do retail stores really need to be tens of thousands of square feet and sell/stock everything in their catalog which is redundant to their e-commerce store?

Why can’t retail stores be discovery-and-customer-service engines staffed by salaried product specialists?  The actual goods that I might want to buy, maybe outside the top 10, would be ordered online and be delivered to my home or a central pickup area.  Stores would have a lot less overhead, smaller, wouldn’t be competing with their e-commerce P&L, attribution of marketing would be easier (shopping in one place), and product distribution would be easier for brands.  This doesn’t sound half bad…

Retail needs to change.  Just look at Best Buy.

One Buying Platform for All Media

Back in June 2011, I wrote a post titled, The 87.5% Category According to Luma – Lots of Acquisitions.  The purpose of the article was to highlight that ad serving systems for online/digital media had a high propensity to be acquired or realize a significant exit.  87.5% of all ad servers on the chart had gone through an exit.  Not bad.

Over the last week of December, I spent some time at home and caught up on my favorite blogs and online content in between playing with my two kids.  In doing this, I spent time reading a December 20th post on AdExchanger by Google’s VP of Display, Neal Mohan.  While I’ve personally never met Neal, I have a lot of respect for what he’s doing at Google.  He has a great quote that I couldn’t agree with more:

We also know that advertisers and agencies ideally don’t want a separate buying platform for each type of media — they want a way to buy across all formats, and in 2012 I think they’ll get it. Real-time bidding (and by extension audience buying) has proven to be a transformative technology for buying desktop display — on our exchange, it currently accounts for 60 percent of all transactions. In 2012, we’ll start getting into that ballpark for mobile and video as well.

If you recall, when I wrote the 87.5% article, I highlighted an area in particular stands out to me as a killer opportunity:

If I personally was to start a company tomorrow, I’d probably create the next 3rd party ad serving system built for the future of all media (able to serve site-direct placements, social media and RTB) and include the opportunity for biddable, rich media, video, and full reporting & analytics.  I believe no ad serving system delivers superior reporting and analytics so this is an area that I’d specifically make sure I’d nail.

I think this is an area for massive innovation because the vision that the industry hasn’t recognized the full vision for the future… I believe that all media will be served, tracked, and optimized across all channels.  Television, print, radio, and out of home will all in some way or another be served, tracked and optimized.  This obviously cannot happen overnight as there are quite a few barriers and obstacles to go thru, but the opportunity is huge.  There is a reason why 87.5% of the companies in the ad serving segment have been acquired.

It looks like Neal and I are thinking the same thing and if any of you entrepreneurs are as well, I’d love to meet you.  This is an area that we are searching to invest in at kbs+ Ventures.  You can contact me here.

2012 Advertising & Media Technology Predictions

Over the years, instead of writing my own forecasts and predictions, I’ve aggregated them on this blog as a source for everyone to turn to for marketing, technology and media.  Here are the lists for 2008, 2009, and 2010.  This year, instead of aggregating them, I wrote 5 predictions that I think will come true for Advertising and Marketing Technology in 2012.

The predictions are below, but you can read more about them here on Advertising Age.

1.  The vGRP metric gets adopted once released and AdXpose/Comscore finally makes sense to most people

2.  Trading Desks are no longer the bright shiny object for Madison Avenue as they begin to mature and become growth businesses for holding companies.  Holding companies need to make a strategic decision whether or not they are going to continue to support them and if so, they must acknowledge and realize they are building technology organizations.  If not, we’ll start to see some trading desks spinning down (or out) of holding companies in 2012.

3.  Agencies who are not agencies will challenge the agencies.  I like the title on this one:  tomorrow’s madison avenue will look different than todays.  Read more about it in-depth over at Ad Age.

4.  Attribution drives dollars to currently undervalued assets.  By using engagement mapping, TrueCPA, or other fun names for understanding conversion attribution, media buyers will actually be able to purchase sites that aren’t part of the lower purchase funnel.

5.  And of course, what marketing technology trend and prediction list would not include Consolidation and Investment as a headline?  Mine certainly will.

I’m super excited about the above 5.  There are quite a few more but these are my starting five going into 2012.

Marketing Technology behind $35 billion in holiday 2011 ecommerce sales

Ever wonder who is the marketing technology behind the $35 billion dollars in e-commerce sales this holiday season? If you are an agency, wall street analyst, marketer, optimizer or any other player in the digital media ecosystem, you probably want to read below.

I always tell my team at The Media Kitchen that you can learn a lot from what other companies are doing; the good, the bad, and the ugly… so study them.  On the web, it’s relatively easy to study companies and their respective infrastructure as the source code of competitors is only 1 click away.

I teamed up with my friends over at Evidon who own the Ghostery product and had them send me a data dump of 3rd party tags that were placed on 20 e-commerce sites (list below).  Note, the data I have is fairly reliable but not perfect, so I may have missed a partner here or there.  However, I do have over 150+ partners who had tags down on these 20 e-commerce destinations, so I feel I have a directionally accurate view of who was part of the marketing technology ecosystem for Holiday 2011.

Sites I tracked were Best Buy, CouponCabin, Sports Authority, LL Bean, Gap, Dicks Sporting Goods, Bed Bath & Beyond, SVPPLY,, Modells, Zappos, Old Navy, Disney, Target, Walmart, Gilt, Sears, Amazon, NewEgg, and Piperlime.

I counted a total of 413 partner tags/pixels placed across these 20 sites (note, I only went to 1-2 pages per site and assumed tags would be similar across most pages).

Executive Summary (full report can be downloaded here)

  • Best Buy, CouponCabin, and Sports Authority properties contained 43% of all tags placed.  The top 10 of the 20 sites accounted for 85% of all tags placed.  I am actually surprised that Amazon didn’t fall into the top 3, but again, Ghostery told me they only had 3 tags down on their pages (Turn, DoubleClick, Google Analytics).
  • The top 3 tags placed across all 20 sites were Google Analytics, Omniture, and DoubleClick.  No real surprise here.
  • The biggest surprise IMHO is that Google+1 outranks Facebook and Twitter as social plug-ins that are embedded across these ecommerce publishers.
  • The DSPs are in-line with the recent Forrestor report so I didn’t find anything crazy in those numbers.
  • Google Analytics has 70% coverage across these 20 e-commerce sites.  Imagine the data that Google could/is collecting.  Just saying.

In order to digest this 1000+ cell data dump, I created a schematic whereas I broke down the product (such as Tag Management) and took the top companies and their % composition the 20 e-commerce destinations.  The link to the excel sheet is at the bottom of this post.

Web Analytics software:  Google Analytics (70%), Omniture (60%), Foresee (40%), Webtrends (15%), Yahoo Analytics (15%), Coremetrics (10%)

3rd Party Ad Serving:  DoubleClick (55%), Microsoft Atlas (25%), ValueClick MediaPlex (35%), MediaMind (5%)

Tag Management:  BrightTag (20%), TagMan (5%)

DSP:  AppNexus AdNexus (30%), Turn (25%), MediaMath (20%), Invite Media (20%),  AdNetik (10%), X+1 (10%), Lucid (5%), DataXu (5%), Rocket Fuel (5%)

Exchange:  Right Media (35%), AdBrite (15%), OpenX (10%)

SSP:  PubMatic (50%), Rubicon (25%), Admeld (10%)

Social Plug-Ins:  Google +1 (45%), Facebook (40%), Twitter (15%), AddThis (15%)

Site Optimization:  Omniture (60%), Monetate (20%), RichRelevance (20%), Visual Website Optimizer (15%)

I believe the Omniture & DoubleClick tag data above is a bit misleading because those are grandiose tags that can do many different things and without the right context, they could be categorized incorrectly.  I tried my best.


Google dominates pretty much up and down the marketing technology stack. I still think they should buy Adobe to become the monopolistic dominant player (to get Omniture), but I don’t believe the government will ever allow that.

I was actually surprised that Omniture didn’t have even higher composition of the 20 ecommerce players.

I couldn’t tease out DoubleClick AdX from their other tags so that’s why they weren’t included in the Exchange part.

And of course, since I work, play, and invest in the marketing technology ecosystem, I’m conflicted up the wazoo with many of the companies mentioned in this post as well, as, the data in the chart linked below.  I have done my best to tease out bias.  Please proceed with caution but honestly, I don’t think you need to.  Contact me if you are interested in discussing.

Thought you might find all of this data interesting.  I have included my chart here in case you want to download it and play with it.  The full report I put together is located herePlease remember to give proper attribution if you use it.

I’m curious to look at this data in 2012 and compare it to 2011 (I don’t have historicals).  I’m sure we’ll see some interesting changes.

Happy holidays.

Darren Herman is the Chief Digital Media Officer of The Media Kitchen (part of kbs+) and is President of kbs+ Ventures which is an early stage marketing technology institutional investment arm of the agency.  His tweets can be found at @dherman76 and blogging here at

YOUniverse & Personalization

An area I have been studying for a while is personalization, especially under a macro trend that is termed the YOUniverse.  While I did not create the term, Renier did, it’s an area that has been of increasing interest to me.  Personally & professionally, I have been involved in personalization over the years: content recommendations (, mens shirts (Second Button), and ad optimization (Varick Media Management).  In 2001, I had a business plan to essentially create what become Second Life, but it never got anywhere.  It was all about personalization.

Ninety years ago, pretty much everything was personalized.  We went to the butcher, he chopped meat to our liking.  We went to the tailor and came away with a perfectly fitted suit.  We needed pencils, so we sharpened them ourselves to match what we needed.

We moved away from this customized business world because we optimized our processes to create cost efficiencies that were passed to the consumer as well, as, created additional margin that was kept for the business.  It was a win/win.  The Gap emerged, created a lower cost pair of basic jeans, and was able to sell at a lower price point because they created 1,000,000 items of the same thing in mass factories.  If someone wanted a very specifically tailored pair of the jeans from the Gap, they had to purchase the jeans and then take them to a tailor and the tailor would alter them.  Inefficient, but this is how it works today.

In a world where technology (and software) is penetrating every industry imaginable, processes are going to evolve.  It was cost inefficient to create custom/personalized items back then, but will not be tomorrow.  The world of personalization is starting to unfold at a price point that is palatable for consumers.

What is a key attribute of personalization is that the consumer is part of the creative process.  Every one of us, consumes, have at least 1 bone of creativity in our body and the more we can exercise it, the more we are satisfied and inspired.  Union Square Ventures & Index Ventures both invested in a 3D printing company, Shapeways, which celebrates personalization, but it’s certainly not for the masses, yet.

A recent example of personalization: The Apple iPhone.  The iPhone is a platform which every owner can customize their own experience.  Unlike a feature phone, there is a real relationship with the iPhone because of all of the customization that goes into it on a consumer/app level.

I am very inspired and excited about the opportunities in the YOUniverse.  If you are too, I’d love for you to leave some comments around areas that you are innovating in.

Your Daily Game Plan

If you play a sport, you don’t take the field, court, pitch or ice without a specific plan of action.

If you sit on the board of a company, then your board meetings are time to evaluate plans.

Each day when you wake up, do you create a (daily) game plan?

For someone who has a lot on their plate, this is something you should seriously consider.

Pick 1-4 things to accomplish each day and do it.  That’s your game plan.

Use whatever tools you need to keep you on plan: Google Docs, Teux Deux, or something else.

You’ll start (or continue) winning.

This post was inspired by Seth Godin.

We've Seen It Before

I walked into the office this morning and my colleague at kbs+ Ventures, Taylor, greeted me with excitement around some of the latest mobile marketing studies that were released.  TechCrunch has an article titled, In Mobile Advertising, Does Size Matter? and Forbes has an article titled, What if Mary Meeker is Wrong and Mobile Ads Never Really Take Off?

Thru our clients at the agency, I’ve deployed many mobile campaigns.  I also oversee a tablet/mobile client of ours, so I’ve spent quite a bit of time within the mobile space.  Additionally, we’ve invested in a few companies that participate directly with the mobile space.

Mobile engagement rates are higher to what we saw with the early days of the web, but it’s a false positive.  Let me explain (and I’m certainly not the first to do so).  If you’ve heard me talk and heard the line, “it’s the same cupcake, just with different sprinkles,” then this is exactly a use case for the line.

#1:  Screens are smaller, thumbs are wild
Our thumbs (and fingers) tend to touch ads by accident.  It happens and we’ve all done it.  You’d be shocked at how many people touch ads and then immediate click away.  We ran a click-to-call campaign for a client and it drove significant response, but most callers didn’t actually mean to call.

#2:  Bigger drives higher engagement, but more disruption
It doesn’t take a rocket scientist to calculate higher engagement with bigger units.  We saw it on the web.  We could have immensely huge units on the web that drive the same engagement, but do we really want it?  How many desktop web publishers adopted the OPA-sized ad units?  Didn’t we do away with pop-overs and unders?  Do we really need bigger units on the mobile device?  Just because we can, does that mean we should?

#3:  Newness drives engagement
It’s true.  Look at any new platform (or even app) and the engagement rates with the entire platform is higher than when looked at over a period of time.  This is my thoughts and I don’t have data to back this up, but I know from my own experience that I’m more excited on a platform early on than over time.

Net/net, we’ve seen this all before.  CTR’s and engagement rates for email and desktop display were high in the 90s; multiples higher than they are today.  Marketers should certainly take advantage of these high engagement rates if they can as they won’t last forever, I hypothesize, as they come down over time.

I don’t believe that today’s mobile banners are the best use for mobile advertising.  I think there is a better way to monetize the mobile web.  I don’t know what the perfect state of mobile advertising is, but it will involve location based data.  I do believe however that marketing with mobile data will be huge, in whatever form it takes.

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kbs+ Ventures Portfolio News:, Momentum, Hiring, and Tumblr

We’ve been busy in the office which has been why I’ve posted very little over the past few weeks.  However, below are some of the reasons why I’ve been radio silent.  I’m super stoked about all of this and hope that you are too.  See below.
kbs+ Ventures recently announced our investment in a social analytics (plumbing) company called  We are super excited about this opportunity as social is going to become increasingly more important into the fabric of everything we do and having the right infrastructure to manage and measure is of extreme importance to brand marketers and agencies.   There has been a ton of articles written up about the launch of so do not hesitate to check them out.

Adaptly Momentum
Today, one of our portfolio companies, Adaptly, launched a service/product called Momentum.  Nikhil Sethi, the founder/CEO of the company said it best in his blog post this morning:  If we continue to base our paid media buys on only the paid media metrics, we are only measuring 1/3 of the value generated. These results leave so much value on the table and we believe there should be a better KPI suited specifically for social. I’m super bullish on companies who cross the paid/owned/earned media landscape and Momentum is a tool in which can measure this for a brand.

There is no shortage of hiring in our portfolio companies.  Most of the companies are hiring talent here in New York City.  If you are a product manager, developer, front end designer, or business development exec and are looking to join well funded private companies that are in the marketing technology space, do not hesitate to reach out.

kbs+ Ventures Tumblr
We officially launched the kbs+ Ventures tumblog.  Lara has been updating the blog for us and it’s chock full of kbs+ Ventures information and pictures (including our 2011 Holiday Salon).

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