Gasta Tech News:Online display advertising picks up again

David Kaplan
twitter @davidaKaplan

The tentative comeback in online display ad spending appears to be by-passing newspapers. Signs of the recovery started well enough this summer, as the NYT notes that big marketers like Mercedes began showering hundreds of thousands of dollars on dynamic, 3D display ads in newspapers.

But it was short-lived, as ad networks began getting the bulk of Mercedes’ online budget, thanks to the promise of lower costs and the promise of greater targeting. The NYT’s Stephanie Clifford finds marketers use of online newspaper ads and display networks akin to wearing expensive shoes: for a big debut, marketers will splurge on premium newspaper ads; but it when it comes to everyday business, ad networks make more sense.

The latest earnings reports bear that out. Google (NSDQ: GOOG) and Yahoo (NSDQ: YHOO), two of the biggest online ad bellwethers, saw display revenues tick up slightly. But when it came to online ad revenues at the NYTCo (NYSE: NYT), its web ads fell 18.5 percent. Gannett’s operating digital revenues were also about 20 percent lower. Meanwhile, McClatchy (NYSE: MNI) posted just a 3 percent gain for web ads.

Last spring, there was a lot of hope that the Online Publishers Association’s new display ad formats might help draw more dollars from marketers. But ad nets quickly adopted the larger formats for those who wanted them, while other advertisers have complained about the complexity attached to these buys.

So far, the only things major publishers can do to pry advertisers’ dollars is put a greater emphasis on selling the non-premium ads—which Denise Warren, SVP for advertising/chief advertising officer for the NYT Media Group, insists the company is doing to positive effect—and stress the brand building capabilities that come with being attached to a popular web destination.

Gasta Tech News: Balmer on Bing Innovations

Ballmer sees Bing reinventing search
By Rich Cherecwich

Bing increased its share of the U.S. search market again in September, growing from 8.7 percent to 8.8 percent, The New York Times reports. That's a small move, but Bing's search volume increased by more than 8 percent during the same month, while nearly every other search engine saw its volume decline, according to data from Compete.

Bing has increased its market share every month since launching, and parent company Microsoft is taking steps to ensure that growth continues. The company reached a deal with Twitter earlier this week that will let Bing incorporate tweets into searches.

But Microsoft CEO Steve Ballmer knows Bing has a much longer road to get ahead of market leader Google, and he plans on getting there by "radically reinventing the category." Ballmer didn't lay out any specific details, but in an interview with The Wall Street Journal, he hinted that Bing has some search innovations in the pipeline. "We're going to do things that surprise [Google], and they're going to hustle to catch back up and copy us," he said.

Gasta Tech News: Arnon Mishkin on why Steve jobs approach is Important to media companies.

Gasta Tech News:
Arnon Mishkin is a partner with Mitchell Madison Group, where he consults for media companies on improving legacy businesses as well as making the internet profitable. Prior to MMG, he was a partner at the Boston Consulting Group.


One of the most effective television ads for a media company was one that WINS, an all-news radio station in New York, ran several decades ago. It asked viewers if they knew how to set the [preset] “buttons” on their car radio, and then explained, “You pull out the middle button…tune to 1010 WINS…and then push the button all the way in.” In those days, all car radios had the same mechanical preset system. And since hardly anyone had ever read that part of the auto manual, a large number followed the advice in the ad. They wound up driving with the middle button set to WINS – and WINS won the ratings war.
I remembered that piece of ancient media history when I read the latest rumors about the mythic Apple (NSDQ: AAPL) tablet. The tablet has been rumored for long enough to make it the technological equivalent of The Flying Dutchman, but it seems like the device may finally be arriving in port in early 2010. According to Gizmodo, the way Apple is thinking of partnering with content companies suggests it may, in fact, turn out to be worth the wait.
On the web, all content gets posted and made available ubiquitously – through search engines, aggregators and the like. While some call this a wonderful ecosystem, the record shows that almost all the value that has been created on the web has gone to organizations that curate and navigate the masses of available content. They are the companies that have created the essential starting points (first Yahoo (NSDQ: YHOO), now Google,and in the future, maybe, Microsoft (NSDQ: MSFT) via Bing) or folks who create real or de facto “walled gardens” (at first AOL (NYSE: TWX), now apparently Facebook, and arguably Hulu).
Why is it so hard for content makers to create value on the web? Because the web has evolved to minimize content makers’ ability to retain users. Thanks to the power of search, users can bounce from one site to another so effortlessly that it’s tremendously difficult for any one site to monetize their visits.
The iPhone and, apparently, the Apple tablet rely on a very different approach to providing content to users: individual apps, of course. When someone downloads an app, that person immediately becomes a true user of it; the physical size of the device, coupled with a user’s desire to minimize the number of pages of apps, create limits to where that user gets information. While users may choose to drop an app or add others, there is a very clear cost (to the user) of switching from one content provider to another.
In other words, apps allow media companies to compete for that “middle button” that 1010 WINS won. And it’s not just the apps and the iPhone that can help media companies achieve that feat. Any successful e-reader and its downloads could have the same impact. Echoing this point, the author of a previous Leading Voices piece on paidContent argued that the unsung virtue of the Kindle was the way it allows readers to “unitask.”
Unlike the web, the system of apps and downloads (e.g. an e-magazine subscription) provide tools that enable a content developer to build and keep a loyal audience, and you can imagine a variety of workable business models. A business could sell advertising against the customer base or potentially sell things directly to the customer, particularly with the new feature of “in-app purchasing.”
With Apple, the key is that it allows each app developer to “bundle” content – in a sense, just the opposite of what it did with iTunes, where it broke apart the music combo of records and CDs. As companies develop their approaches to apps, they need to figure out:
1. What types of bundles make the most sense – the generic bundles that were the norm in the broadcast television and newspaper industries, or more vertical, branded-identity bundles that were the norm for cable networks
2. How to ensure that they secure as much as possible of the best real estate on users’ iPhones, tablets or other devices
3. How to promote an app, taking advantage of the tools of the web
4. How to move users from their inherently low-margin web sites to different types of e-readers, apps and the like
5. How to make sure they don’t lose the inherent stickiness of apps
As they tackle these questions, content companies can take what they learn in the app and download world and try to make the web more profitable for themselves.

Gasta Tech News: Social Media and Search engines

Facebook/Twitter Use May Now Mean More for Google/Bing Rankings by Chris Crum

Google and Microsoft have both inked deals with Twitter and Microsoft has also inked one with Facebook to integrate Twitter and Facebook updates into Bing search results. Google will be adding tweets to search results.

Google's Marissa Mayer says, " We believe that our search results and user experience will greatly benefit from the inclusion of this up-to-the-minute data, and we look forward to having a product that showcases how tweets can make search better in the coming months. That way, the next time you search for something that can be aided by a real-time observation, say, snow conditions at your favorite ski resort, you'll find tweets from other users who are there and sharing the latest and greatest information."

There is a good chance that Google will be making a similar deal with Facebook, but even if they don't, their deal with Twitter and Bing's deals with both make it all the more important for marketers to be found in real-time searches and Facebook/Twitter in general.

Gasta Tech News: Social Media and Search engines

SOCIAL MEDIA BEST PRACTICE FOR SEARCH ENGINE RANKINGS By Chris Crum

A while back WebProNews compiled a list of five tips for getting found in real-time searches, which basically boils down to staying in the conversation for relevant topics that people are searching for. The tips were:

1. Use keywords
2. Talk about timely events
3. Have a lot of followers
4. Promote conversation
5. Include calls to engagement

I elaborated on each of these in the previous article. Social media is viral by nature, and real-time search is nothing more than putting things in chronological order. You have to keep people talking to stay relevant "right now."

That said, we don't know all the details about how Google and Bing will be integrating its Twitter and Facebook results into the rest of their results yet. Bing has made available a beta tool for people to mess around with for searching tweets with the search engine. "You can now search for what people are saying all over the web about breaking news topics, your favorite celebrity, hometown sports team, and anything else you use Twitter to stay on top of today," says Paul Yiu of Bing's Social Search team.

Sype founders plan to launch Rdio Music utility

They turned the entertainment world upside-down with KaZaA, revolutionized voice communications with Skype and eventually gave up on their web TV ambitions through Joost.

Now serial entrepreneurs and investors Niklas Zennstrom of Sweden and Janus Friis of Denmark are trying again to disrupt the music business. They have funded and are launching a new subscription music service dubbed Rdio, funded by Atomico Ventures.

NYT reveals the “secretive startup”, has offices in LA and San Francisco, “is hoping to introduce a music subscription service by early next year that offers seamless access to music from both PCs and cell phones”. Rdio is seeking label deals and even has a CEO, Drew Larner, who notes the disdain with which the labels regarded the once-renegade P2P app KaZaA in yesteryear: “The ironies are very interesting.”

No word on whether Rdio will re-deploy the same kind of P2P network that has made Zennstrom and Friis famous. The pair first developed the Global Index distribution system for KaZaA, then used a variant to underpin Skype’s communication backbone. Then they thought their could make online video delivery more efficient using Global Index, so started Joost under the codename The Venice Project.

But Global Index is currently the center of an acrimonious and complex legal dispute involving Zennstrom, Friis and Skype, now owned by eBay (NSDQ: EBAY), which licenses the distribution mechanism, which is key to Skype’s functioning, from the pair’s Joltid holding company. They accuse former Joost CEO Mike Volpi of pilfering the system’s intellectual property when he left Joost for Index Ventures, the VC house that is now becoming a part-owner of Skype in eBay’s sell-off.

Even if Rdio relies on Global Index, the legal mess won’t necessarily hold up the startup’s development. In fact, given that 90 percent of digital music consumption is illegal, Rdio may do well to embrace P2P even further, offering the service as paid access to a KaZaA- or Pirate Bay-like distributed file repository, in the same way the company behind the failed Bay buyout attempt had optimistically hoped.

Either way, with momentum amongst music labels clearly swinging behind the monthly subscription model, Rdio will find the space already populated by Pandora (which doesn’t offer on-demand), Napster and, most significantly, Sweden’s well-thought-of Spotify, which was planning a Q3 or Q4 U.S. launch and itself uses a form of P2P distribution.

GastaTech News: Spotify thinks big on music as a utility

By Robert Andrews
twitter @robertandrews

You can’t say Daniel Ek doesn’t think big. “We can increase the number of transactions that happen on the internet to trillions,” the CEO of the most talked-about digital media startup said in a London keynote on Wednesday.
Ek communicated his desire to “package” music with mobile tariffs, ISP bundles, cable plans and with devices including TVs - a broad long-term vision that’s often overlooked amid the current Spotify hype.
“The key for us is getting music in to people’s existing billing habits,” he told Screen Digest’s Future of Online Media Distribution seminar.


“If we can transcend it so that, maybe you don’t actually have to pay for the music, it’s included in your data plan with your carrier or ISP or cable operator; it might be when you buy a new product, a TV screen, that you get one year of music included ... devices like new Samsung TV screens, where they’ve got Linux built in, which allows you to do software on it - they’ve got YouTube built in, they might have Spotify built in.”
Spotify has inked one such deal - announced last week with Sweden’s Telia broadband, mobile and TV operator - and another looks likely with phone carrier 3 by virtue of parent owner Li Ka-Ching’s investment in the music service. Spotify’s business development staff will need to strike more such partnerships to give it the kind of industry-changing breadth Ek envisages.
The U.S. roll-out targeted for Q3 or Q4 is now scheduled for Q4 or Q1 2010, however, Ek later told paidContent:UK.
“If we can go to trillions, just think about the easy math,” he told the crowd. “What about one percent of those converting in to paid subscription, or becomes a paid download, or decides to buy a concert ticket? That’s how we grow the music industry to a $40 or $50 billion industry, by getting it to work on people’s favourite devices.
“We want to create a platform where the (Spotify) brand stands for ease of use and people actually build their library using Spotify and feel this is an experience - and, through their carrier, can access that experience.
“That’s the key for Spotify to make this model work. It’s not about ad-supported music, it’s not about subscription music, it’s not about downloads - it’s about all of those models in one.”
A one-percent premium conversion rate sounds awfully small (Chris Anderson’s Free book postulates an ideal freemium conversion of five percent; Ek told a recent event Spotify’s premium ratio is “not double digits yet, but we think we can get there”). Speaking from Screen Digest’s stage on Wednesday, Ek clarified that he meant one percent of “transactions”, which seems to mean plays or impressions across devices…
“Any freemium service should be very satisfied with around a 10 percent conversion rate,” he said. “Spotify aims to be on the higher end of that, higher than most other freemium services.
“Already today, we are proving we are at the higher end of that scale. We think we can actually accelerate that even further. Ultimately, we have a much better position that most other freemium services - the content that we offer is so much better.
“Looking at other freemium services like Flickr and Skype and so on, the differentiation (with Skype) is merely whether you make a paid phone call (Skype-Out) - you could argue that the experience you get talking to someone on a computer (Skype-to-Skype) is better. With Spotify, the portability aspect really separates the two services. You’ll see stuff on the social end as well that will lend itself to more paid users.”
Stats...
—Users are averaging 72 minutes a day listening to music - that’s massive consumption.
—Ek said Spotify today has six million users.
—It’s adding 30,000 to 50,000 new users each day.
—“We could’ve grown it much quicker” - on the day it opened to users without invites, the service added 180,000.
—The iPhone app has been “an enormous success”, growing premium subs “by a big number”.
—Ek said Nokia (NYSE: NOK) and Samsung are the world’s largest MP3 device makers - “yet no-one actually uses them to play music on” - transferring his library to his Nokia took him 35, Ek said.
“The key now,” Ek said, “is ... offering even better reasons for people to become a subscriber.
“The truth is, if we only have ad-supported users, the model won’t be sustainable - if we only had paid users, the model won’t be sustainable either - f you look at the history of paid services, none of them really caught on. The key here is the balance of both.”

Gasta.com tech news: Virtual coupons for mobile savings

By Bob Bentz president of Advanced Telecom Services.


Mobile coupon growth
The mobile phone is quickly becoming the go-to medium for couponing. As mobile advertising struggles to gain acceptance, it is chipping away at the 300 billion paper coupons issued every year in the U.S.

A recent study by Scarborough Research found that virtual coupons sent via text message are making strides and are a significant force to be reckoned with. Coupon distribution in the U.S. is still dominated by the old-fashioned insert in the Sunday newspapers, with 51 percent of us still obtaining our coupons there.

Here's a breakdown of what percentage of U.S. consumers get their coupons from each medium, according to Scarborough Research:

* Sunday newspaper: 51 percent
* In store: 35 percent
* Direct mail: 31 percent
* Loyalty programs: 21 percent
* Circulars: 20 percent
* Weekday newspaper: 17 percent
* Product packaging: 16 percent
* Magazines: 15 percent
* Email/text messages: 8 percent
* Websites: 7 percent

Advertisers are always seeking the young and affluent, and mobile coupons pinpoint this market, which is usually full of early adopters. College graduates are 51 percent more likely to get their coupons from their mobile phone. Not surprisingly, mobile coupon users also tend to be young adults, with those 18 to 24 years old being 14 percent more likely to take advantage of them. Mobile coupon users are also decidedly female. And according to a study by Juniper Research, mobile coupons are expected to grow by 30 percent in the next two years.

Getting started with mobile coupons
The best markets to test mobile coupons are those with young populations. Atlanta, Austin, Chicago, San Diego, and Washington, D.C., are the best big city test markets, while college towns, like Blacksburg, Va., also make great test areas. Providence, R.I., leads the way in mobile penetration, with 12 percent of its residents using mobile or email coupons

Some mobile marketing sites, such as 84444.com, also allow for each mobile coupon to have a unique tracking code associated with it. With the code, advertisers can determine which customers redeemed the mobile coupons.

Big brands, including Subway, have embraced mobile coupons because the brands can reach their target audiences when those audiences are most likely to buy. Subway sends text messages to its opt-in database just before lunch time, when workers are deciding where to go for lunch. If they receive a mobile coupon, the decision is almost made for them.

Most mobile coupons start out with the brand creating a database of opt-in users. At Subway, for example, posters are hung near the line at the restaurants. When a customer is waiting in line, the only medium at his disposal is his cellphone. By sending a text message to a short code (for example, texting DIETCOKE to 84444), he can immediately receive a text message that either enters him in a sweepstakes or provides a discount coupon.

This is where the fun starts for brands. Once a brand has an opt-in database and an existing relationship with a consumer, it can send text messages to that consumer in the future.

A consumer may opt-out of any mobile marketing campaign simply by replying "stop" to the text message received. According to Anthony Wayne of the Text Message Blog, the opt-out rate for mobile coupons is only 3 percent.

"There's a fine line between sending enough and sending too often," Wayne said. "If you overdo it, and don't send anything of value, consumers will tire of your messages and opt-out more often."

Coupons go green
With more and more companies going green, mobile coupons fit the bill. Most of your mobile coupons won't end up in the landfill, but will ultimately be erased by the consumer's cellphone.

And, that's good for all of us, whether we are coupon users or not.

Gasta Tech News: Social Media Will Not Replace Search

Social Media Will Not Replace Search

By Chris Crum - Tue, 10/06/2009 - 12:10


Do You Trust Strangers More Than Search Results?
Nielsen has shared some interesting findings from its research on how Internet users discover content. The research mainly focused on how content is found through search, portals, and through social media.

"In a nutshell, there is a segment of the online population that uses social media as a core navigation and information discovery tool — roughly 18 percent of users see it as core to finding new information. While still a smaller percentage than those who use search engines or portals like Yahoo! or MSN, it is a significant figure," says Nielsen. "And as social media usage continues to increase (unique visitors to Twitter.com increased 959% YOY in August) I can only expect this figure to grow."

If you were still questioning the possibilities of getting traffic from social networks like Facebook, MySpace, Twitter, etc., perhaps this information will help ease your doubts. While the traffic may not always be as significant as what comes from search, additional traffic is additional traffic, and the viral potential offered by social networks shouldn't be ignored.


"At the root of the changing nature of content discovery is the sheer amount of information that is available on the Web," says Nielsen. "If you want to learn more about the latest smartphone released into the market, your favorite search engine is sure to provide you with hundreds, if not thousands, of articles about the device. But with the increasing number of resources available, it’s difficult to know what you should believe or take at face value."

According to the firm's findings, 26% of "socializers" or those who spend over 10% or more of their online time on social media, feel that there is too much information online. Nielsen says, "So are social networks replacing portals or search engines? Perhaps. Regardless, if we don’t understand and address people feeling increasingly alienated by the amount of information on the Internet, and the need for a human guide, yes, your favorite social network (or something like it) will become the next great content gateway."

Of course the search engines are built on a cross between human and mechanical elements. Google's search quality team has been discussing this very process. Personally, I'm all for social media, but I don't usually have too much trouble finding the information I seek using search. If anything, I think the information overload simply stresses the need for the continued improvement in search quality.

Your friends may not have all the answers you seek. Furthermore, if you are asking people you don't know, why would you trust them any more than search results?

Search and social media are not completely separate entities. Social networks have search functionality and search engines search through social networks. It's all intertwined.

Gasta Tech News: Why your conversion rate is an erroneous metric

By Brandt Dainow
September 25, 2009

The ultimate measure of a website's success is its conversion rate -- the percentage of visits that resulted in a sale or an inquiry. It is supposed to measure the degree to which the site converts visitors into customers. As such, it is deemed to provide the ultimate assessment of whether a site is successful or not. In a single number, it captures the appeal of the design, the ease (or otherwise) of navigation, the effectiveness of the sales pitch, and all the other factors that affect a visitor's willingness to buy from you.
Except that it doesn't.
The conversion rate tells us absolutely nothing about the site. It's a completely useless metric.
As a professional web analyst, my job is to analyze a site's web metrics and determine from those numbers where, and what, improvements are needed in order to increase the rate at which visitors convert into customers. Doing this over and over again has taught me that the conversion rate is of no help at all.
Let's go back to basics and work this through. I think if you follow along with my reasoning, you'll see there's no point calculating the conversion rate. Luckily, I have an alternative I think you'll prefer.
The problem with conversion rates
Firstly, the conversion rate is supposed to measure the success of the site as a sales pitch -- an attempt to turn a browsing visitor into a customer. The problem with the conversion rate is that it calculates the percentage of all visits that resulted in a sale. This means it includes people who bounced. By definition, a bounced visit is one that looked at only a single page then left. In other words, they never entered the site, they never engaged with the material within it. Thus, bounced visitors were never exposed to the site's sales pitch.
There are two steps in converting a visitor into a customer. When someone lands on your site the first thing you need to do is convince them to stay. Only after that can you try to sell them something. It's like the shop window: You've got to get people into the store before you can try to sell to them.
The overall average bounce rate is around one-third. It's extremely difficult to get a bounce rate below 30 percent simply because search engines are far from perfect and can list the wrong sites. In addition, people frequently scan a number of sites before deciding which one to return to and engage with. It's also possible to be legitimately listed in the search engines for content you don't have.

For example, I have a client who owns a chain of restaurants. Like most restaurant sites, it includes the menus available. Due to some extremely high-quality search engine optimization, the site accidently became No. 1 in Google for a series of menu-related phrases, such as "set menu," "Christmas menu," and "menu ideas." The result was thousands of people arriving who were looking for menus they could cook at home, not a restaurant. Needless to say, the bounce rate for these people was extremely high -- around 80 percent -- and none of those who remained converted into restaurant bookings. This dragged the overall bounce rate for the site as a whole up to around 50 percent, which proves how important it is not to look at the bounce rate for the site as a single figure, but look at the bounce rate for each audience segment individually.
It is especially important to look at the bounce rate for different referring keywords because this tells you how the site appeals to different audiences. In this case, we found the bounce rate for people who were actually looking for a restaurant was down around 25 percent, so the site was doing a pretty good job of holding onto new arrivals. However, the key point for our purposes is that all this inappropriate traffic, with an extremely high bounce rate, pushed the conversion rate down to less than 1 percent. This makes it look like the site is a disaster.
When I see a conversion rate calculated from the total number of visits, including bounces, I don't know how much it's been affected by that bounce rate. In other words, I don't really know if I need to improve my landing pages and engage more arrivals, or if it's my actual content that needs more work.

Mobile Search Ovum on Gasta.com

OVUM PRESS RELEASE

Melbourne, 7th October 2009. With a growing appetite for mobile applications, services, and content, consumers and business users will be looking to mobile search to streamline their information/content access and retrieval.

“Unfortunately, there is little ‘joy of use’ in the current mobile search user experience”, said Sarah Burnett, Ovum Senior Analyst, based in London. With a growing appetite for mobile content, consumers and business users will be looking to mobile search for information or content access and retrieval. Given the rapid evolution of mobile devices and networks in recent years, they would be justified in thinking that mobile search would provide slick interfaces and accurate results. But in most cases they would be disappointed. While search on the Internet has revolutionised how we access information, the same is not true of mobile search. This is still in its infancy, and the typical user experience leaves much to be desired.

Burnett said, “Vendors and content providers have to recognise that people interact with their mobile phones in very different ways than they do their PCs. The interaction is dictated by the tiny screen, typically awkward keypad and limited on-screen navigation. Given these constraints, navigating a long list of search results is hardly user-friendly”.

“Mobile search should deliver answers, not links”, advised Mark Blowers, Ovum Principal Analyst. There is more to mobile search than just browsing. In mobile devices there is an increased need for accuracy, relevancy and contextual results. This is not to say that PC users do not require the same, but on a PC it is much easier to create an advanced search query that improves the probability of getting the right answer. The need for a simple and easy user interface and user-friendly results is amplified in a mobile device. Already, mobile search tools such as Taptu only list sites that are optimised for mobile viewing. As more people switch to mobiles for web access, site sponsors will see their hits decline unless they provide better mobile support.

Google and Yahoo have begun to offer location-tailored results. Given their Internet search presence, it is not surprising that they are two of the leading players in the mobile search market – helped by alliances with mobile service providers that place them as preferred search solutions on web-enabled handsets. Their solutions are optimised for mobile use and, to facilitate speed of delivery, URL and search suggestions appear as you type. Another vendor, Apple, provides a good example of how successful location-based search applications can be – there are many offerings within Apple’s App Store that use the handset’s location to provide details of local facilities (such as restaurants) and other tailored information.

“The giants of PC-based search will be difficult to topple. Small technology companies will continue to create niche mobile search applications, but brand recognition and deep research & development pockets make existing market leaders obvious favourites in the race for mobile search queries and, ultimately, the associated advertising revenues”, concluded Blowers.

- ends-