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Are Google’s Friend Connect, Myspace’s Data Availability and Facebook Connect just Spam 2.0?

Published on May 19, 2008 in Innovation and Social networks. 2 Comments

Just because I am friends with you at work, doesn’t mean I want you to come to dinner with my friends from university. Just because I am friends with you on Facebook, doesn’t mean I want to be your friend on Dogster …

Connections between people are given meaning by their social context. The connection per se is devoid of meaning. This case has been eloquently made by Jyri Zengestrom in his discussion of social objects. To paraphrase his argument, social networks are effective when they bring people together around a shared object, e.g. in Dogster this could be the like of a specific breed, in HMV’s Get Closer it could be a shared experience at a gig. Social networks are less effective when the shared object is weak or absent - which explains at least to me why networking sites, such as Linkedin, Viadeo or Xing, feel quite sterile.

What has all of this got to do with the rash of recent announcements from Google, Myspace and Facebook regarding ‘portability’ of social network profile data? Well, for starters, the commentary thereon has been largely focused on whether these announcements constitute a new reign of openness in social networking or a continuation by other means of a walled garden strategy - Dare Obasanjo and Marc Canter’s posts are good reads here. However, I believe its necessary to evaluate these moves by Google, Myspace and Facebook on terms broader than data ownership (is it our data or their data?).

A more fundamental question is whether the profile data contained in one social networking site can be ported in a meaningful way to another? Of course I could take my basic profile information anywhere (and mechanisms to make this easy are to be welcomed!), but the richness of a social networking site is determined by what’s been invested in the shared objects between linked individuals. So whilst I could take my photos with me from Facebook and expose them on any site I chose to, what will happen to the tags, comments and associations that bring them meaning? Will this meaning be carried over to other sites? Also on the question of data ownership … the photo is mine, but is it still just mine when it functions as a shared object? Will the friends who tagged the photo and commented on it be happy for me to share this data with other networks of people?

My gut feel on these questions is that the answer will often be no. Rich profile data can’t necessarily be moved from site to another and retain meaning. The connections created in one site around shared objects may not be sustainable if those objects are not present on the new site.

And that makes me think that in the worst case scenario Google’s Friend Connect, Myspace’s Data Availability and Facebook Connect might herald the Web 2.0 version of spam as we indiscriminately send unsolicited bulk messages to our ‘friends’ about things they know little of and care less about.

Communications power conversations power commerce

Published on May 1, 2008 in Development and Online commerce. 1 Comment

I have been fascinated recently by the chatter around what Ebay may or may not do with Skype. On the table is a sale of Skype if synergies with Ebay’s core business can’t be found.

Two broad questions jumped out at me on this issue:

1. What role should communications play in online commerce?

2. Can ‘open’ communications work within a ‘closed’ walled garden?

The answer to the first question is actually very straightforward. Communication is at the heart of all commerce. People do business when they converse. Today that interaction between buyer and seller may be an email, or IM, or a blog comment, or just reading a review. But it could be also be video chat and will often be a plain old telephone call. In practice, the consumer journey moves between different modes of communication at different stages of the sales cycle and in no particular fashion.

The challenge then for players in online commerce is to facilitate these interactions between buyer and seller - to provide the touchpoints that take the commercial discussion a step further to a conclusion that could be online or offline. The good news is the tools are there today for developers. Acknowledging my BT-bias, BT’s Web 21C SDK is a great example of a set of web services that enables developers to integrate communications services into the fabric of their application/user experience. The likes of Jangl, Jaxter and indeed Skype promise similar.

However today, the leading lights of online commerce have held back from embracing communications as web services and embedding them as linchpins of their user experience. This brings us to question 2.

Communications, especially voice-based ones, threaten any web site with a business model based on containing interactions between its members within a walled garden. Taking the discussion off site fuels the grey market in a nutshell.

And so we have a conflict … buyers and sellers want to interact in many different ways in the sales cycle, but online markeplaces want to constrain those interactions to a narrow set that fit their business model. As I see it wherever there’s a conflict between people’s needs and existing solutions, there’s a massive opportunity, particularly in the realm of online commerce that is still very underdeveloped in the SME market. And that’s the opportunity the team at BT Tradespace is working away on - to build a platform that will facilitate conversations between businesses and their customers such that they can do business on their terms.

Apple thinks different in online marketing

Published on April 13, 2008 in Innovation and Online marketing. 1 Comment

For the last month or so Apple has dedicated its home page to its iPhone software roadmap. This struck me as a bold and left-field marketing move. After all, the Apple home page is a massive online asset - according to Comscore, Apple’s web properties had 140M unique visitors in February - so anything that goes on that page needs to be decided quite deliberately!

iPhone software roadmap

Why turn over Apple’s prime online real estate to a message that is principally not B2C, nor even B2B, but A2D - i.e. Apple to Developers? The language used on the page, e.g. ’software roadmap’ is clearly oriented towards a tech industry audience and the eye tracks directly to the acronym ‘SDK’.  For a consumer brand that has built its success on making technology simple, easy to use and understandable this is puzzling at first glance.

On reflection, Apple’s home page take over is a bold statement by the company that reveals not only its appetite to take a real marketing risk, but also the seriousness and confidence in driving forward its strategy to turn the iPhone into the company’s next big platform play. Apple knows to do that it needs to market itself to developers. What better way to open that engagement than by demonstrating how serious it is by dedicating its hugely-trafficked home page to the task?

Many companies are rolling out their own APIs and SDKs for third party developers to build services upon - for example BT has a great SDK for communications services. However, to date Apple appears alone in realising that its core corporate marketing vehicles are tools to be used to engage third party developers to support key growth areas.

Apple has clearly ‘thought different’ about how to use online marketing to support business strategy.

Big business is grappling with social media (but still keeping it’s gloves on …)

Published on March 16, 2008 in Advertising, Online marketing and Social networks. 1 Comment

TNS Media Intelligence/Cymphony released a very interesting report at the end of February on “how brands are unleashing the power of social media”. Based on phone interviews with 71 senior marketing execs in large enterprises in the US and Europe its gives a qualitative gauge on how big business is looking at social media and networking as a marketing medium and channel.

The full report and presentation is worth a close read and a handful of key messages jumped out at me.

1. Big business understands that social media is only going to grow in importance with 56% of respondents (rising to 80% in the US) seeing it as very significant for their companies within the next 5 years.

2. But, today the marketing organisations of major corporates are not at ease with social media. They see it as a source of customer insight (68% said they read and analysed social media to understand customer perception), and as a new channel for marketing/advertising campaigns, esp. viral (62% of respondents agreed). In short, big business is passively consuming social media or trying to map a fairly traditional campaign model to the medium. What it’s not doing is actually taking part in the community on the same terms as its customers.

3. There is a strong feeling that marketing agencies don’t get it. A typical quote from a respondent (this one from Johnson & Johnson): “They are not doing a very good job at all. At the moment most agencies still view social media tools as just another vehicle for driving their messages.”

Whilst TNS sees this as a reflection of the immaturity of the market and the need for agencies to acquire the skills to assist their clients exploit social media, I see a more fundamental problem. If social media is about having an authentic and unmediated connection with the community with direct lines of communication between the company and its customers, then this ‘conversation’ simply cannot be outsourced to an external agency. Rather marketing, sales and service departments have got to undertake this role themselves.

So all in all, a pretty clear picture that the big brands have got a long way to go to make ’social marketing’ part of their business as usual.

AOL’s buying Bebo might just pay off

Published on March 16, 2008 in Advertising and Social networks. 0 Comments

AOL’s cash purchase of Bebo may just work out for Time Warner. But ironically it may be Time Warner content rather than AOL’s online assets that will make the deal work.

Bebo has crafted a monetisation strategy based on wrapping advertising around third party content. Founder Michael Birch explained:

“What we’re trying to do here is simplify the whole relationship between media companies and distribution platforms. There’s value for Bebo and our users by having great quality, legal content on Bebo. And there is clear value to the content owner in both controlling the content and advertising, and in keeping the subsequent revenue.”

In other words, good for Bebo as it gets more content on its site, good for content providers as its gives them distribution for both content and adverts to Bebo’s 40 million members. Just last week ITV announced that it will make programming from ITV 2 available on Bebo - the first time ITV has made full length content available on a third party network.

So it strikes me that if Time Warner uses this acquisition to distribute engaging content to the Bebo community and then make this content its platform for online advertising it will be in a strong position to turn a Shilling from the deal.

But if AOL just looks at Bebo’s enormous user base and then thinks it can pump ads into the community without a relevant context or engagement it will be sorely disappointed with the results as shown by Google.

The big question then is whether Time Warner’s content house can work with AOL to make the deal work - that’s likely to be the bigger challenge to this deal succeeding.

Is the party over for ads on social networks?

Published on February 25, 2008 in Advertising, Online marketing and Social networks. 0 Comments

With the wobble in Facebook’s monthly traffic suggesting that perhaps we are all getting tired of social networking (or then again maybe not), it was instructive to read Aaron Wall’s post on why social network traffic doesn’t monetise. The thrust of that argument is that advertising on social networks is typically not relevant to the interactions taking place in communities. As a result traffic quality is poor and hard to monetise.

It feels inevitable that there is going to be a backlash against the advertising-based business model of social networking. But if we accept that social networking as a medium (rather than any particular instances of it) is not going away and will continue to grow, it then becomes incumbent on online marketers to find better ways to engage the social graph. A new tool set is needed as the current tools are lacking …

For example Facebook promises that by using its ads you can “reach the exact audience you want with relevant targeted ads”. I would be really interested to hear people’s stories about whether these ads have been successful or not for them. My hunch is that simply having a well-targeted ad based on granular demographic data will not help conversion if it is blind to the social context it is served in.

The way to get that context is through participation in the conversations that your ‘audience’ is having. In other words join the party. The party metaphor is a great one for a community and quite insightful for online marketers. In the off-line world sponsorship and product placement work well as promotional tools at social events. Social networks offer plenty of opportunities to create branded/sponsored spaces for online conversations. And companies such as Blendtec (intentionally) and Coca-Cola and the Perfetti Van Melle Corporation - the maker of Mentos mints (unintentionally) have demonstrated the uplift in brand visibility and sales that comes when your product is at the heart of the online conversation.

So the message for online marketers is clear … as far as making money from social networking goes, the party is far from over … in fact it is just about to begin. Cocktails anyone?

How to make money from social networking (or not!)

Published on February 2, 2008 in Advertising and Social networks. 5 Comments

Google’s apparently struggling to make money from serving ads on social networking sites. In an analyst call for the Q4 2007 results Sergey Brin admitted “I don’t think we have the killer best way to advertise and monetize social networks yet, … It’s a big opportunity because it’s so much inventory.”

This must be extremely frustrating for Google:

1. it is the leading platform for online advertising by a long, long shot

2. there is a massive, hyper engaged online audience in the leading social networking sites, that are amongst the biggest properties on the Net.

It seems almost inconceivable that online advertisers are not raking it in. But then again, what if the social networking audience is just not receptive to the traditional click through ad model? After all, for Myspace, Facebook and Bebo usage is about participation within the community and engaging with people you know or want to know. Why then click on ad to be taken off site?

Google seems to have realised that to monetise social networking sites it needs to do more than just put Adsense on Myspace. And more sophisticated targeting should bring better conversion. But taken too far and made too invasive as in Facebook’s beacon and users will rebel threatening the very usage that makes advertising attractive in the first place.

What’s to be done? Is this an intractable problem that will mean social networks even as they continue to grow will stay tantalisingly just outside the reach of online advertisers? If so, how can social networks be monetised?

To answer that question, we really need to think about where the value is in a social network. For me that value is in the connection between people and the exchanges they have in a community - in other words its participation that creates value in a network.

If we accept that, then businesses should be looking not to advertise, but to actively participate in a social network with the objective of engaging customers and creating advocates who will champion them to extended networks. This is what social commerce is all about and its a long way from the mantras of CPM and CPC that dominate the online marketing business today - isn’t it time we moved on?

Blogs … a low cost, high return marketing tool for small business

Published on January 1, 2008 in Online marketing, Small business and blogging. 3 Comments

So says the New York Times and it’s no surprise that I agree with them!

The article gives a good overview of how a blog can help a small business to market itself and build its brand and has some very nice supporting case studies. But the NYT does suggest that not all companies will be suited to using blogs as a marketing tool for a bunch of reasons, including that they may not have “enough to say”.

I don’t think the latter’s really the issue. Rather blogging (just like podcasting or using video) is a very new marketing tool for small businesses and the rule book hasn’t yet been written. As I’ve seen at BT Tradespace, SMEs are already using blogs in a variety of ways from a direct sales pitch, to source of advice, to general discussion. The level of experimentation is very high.

What is likely to happen is that in the hands of many thousands of small businesses, (the majority of whom will be coming to the medium for the first time), blogging itself is going to change. In fact many of the discussions about what is an appropriate use of blogging for marketing purposes may soon seem quite quaint as SMEs claim the medium for themselves.

As William Gibson said “the future is already here. It’s just not very evenly distributed”. My prediction for 2008 is that the use of blogging and other forms of social media as marketing tools will go well beyond the current niches and become mass market and that as a result we will see a new type and style of online marketing emerge with SMEs in the driving seat.

Will Myspace put online advertising into the reach of SMEs?

Published on December 11, 2007 in Online marketing, Small business and Social networks. 0 Comments

Myspace announced in November its plans to launch a new advertising platform, Selfserve, targeted at small businesses in early 2008. This seems like quite an important development and worthy of comment because:

1. It’s an ad platform for SMEs - now there’s quite some debate about whether Myspace is the right context for small business, and for many it undoubtedly isn’t. But the fact that Myspace has invested in Selfserve suggests that it believes it has the base already to make it a success.

2. Selfserve is about making online advertising accessible to SMEs -That means cheap (apparently pricing starts at $10) and easy - the ad platform has been designed for small businesses to set up and run their own campaigns. If Myspace achieves the latter it will have made a breakthrough as, despite Google’s efforts to date, online advertising is too damn complex for SMEs to master. Myspace acknowledged this in its release when it says that of over 23 million SMEs in the US less than 1 million advertise online.

3. Selfserve is about driving traffic to a Myspace profile - usage stays within the community and is not taken off site. This is quite a revolutionary change from traditional net marketing that is all about driving traffic to a web site. In Myspace’s model, not only is the SME spending their ad money in the network, they also have to invest time keeping their profile engaging and up to date in order to convert leads. A Selfserve advertiser will therefore be a very active Myspacer.

I’m going to be following Selfserve with interest as it’s a clear sign that Net marketing is going to be increasingly about managing a constellation of online assets in relevant communities, than sucking traffic into a stand-alone web site. It’s also an indication that engagement and quality of participation in a community will be at least as important as ad spend in driving campaign success.

Small business gets Web 2.0 … because it has to

Published on December 4, 2007 in Online marketing and Small business. 2 Comments

The presentation I gave to the Revolution conference got reported in Brand Republic. I’m very glad to see they thought it news worthy enough to comment on, less happy that they seemed to have missed the point. The article picks up on some research carried out by BT Business in June on SME Internet usage that found that only 8% of small businesses have a ‘fully comprehensive online marketing strategy’ - true enough - but the article then suggests that this is despite Web 2.0 tools being more suited to SMEs than larger enterprise. And this is where the article loses the plot.

Small businesses are starting to adopt web 2.0 tools to market themselves online precisely because traditional net marketing built on the ‘big iron’ of integrated campaigns using paid search and display ads and supported by a comprehensive SEO strategy is beyond the skill sets and resources (time and money) of most SMEs.

SMEs are struggling with online marketing and sales today and this is shown in the numbers. >40% don’t have web sites, <20% sell online and the percentage that make any significant sales online is much less than this. Running a web site is a costly, complex business that often requires the support of third parties to build, maintain and market.

Now look at the tools of web 2.0 - blogging, podcasting, photo and video sharing - adopted by millions of consumers because they are simple and powerful communication tools. These characteristics make them ideal for small businesses to build their net marketing strategy on.

SMEs have a direct connection with their customers in a way that larger enterprises struggle to mimic. That same piece of research from BT Business also found that 52% of small businesses get up to half of their revenue is from referrals, with 31% obtaining 75% of their work from word of mouth.

Now, if we put the costs and complexity of traditional online marketing alongside the growing importance of the Internet as a research and purchasing medium for consumers, it is apparent that SMEs desperately need to find a better way to market themselves online. This is provided through the tools of social media that are very well suited to the personal and conversational marketing style of small businesses that already works to their benefit offline.

I really believe SMEs have the need and incentive to drive innovation in online marketing using web 2.0 - much more so than big companies. We are starting to see this happen already with businesses as diverse as florists and PR experimenting with new forms of conversational marketing. And there’s much more to come.

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