Twitter Ads: Thoughts on the test

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Now, there has been a lot, a lot, a lot of thoughts and talk lately on how Twitter will be making money. Finally, Twitter is experimenting with a new revenue model as Techcrunch tells us…

First, it seemed like a nice idea to promote their own service (i.e. widgets and search), which I thought is the case. This well-placed add-on feature makes it easier to work with Twitter, especially heading towards their search site, when you are not using any of the helpful Twitter apps. And there were also some good thoughts on Twitter becoming a search engine and as how this will be a driver monetizing their business. But Overture (now controlled by Yahoo), has patented placement of text ads on a search results page. So, this was probably a difficult pitch.

Now, back to what is happening, see the black box on the right hand side on ‘Widget’…

It is obviously really a ‘simple’ test for some solid revenue stream generating business, we all are familiar with via Google text ads. But can this be an appropriate test to recall on revenue models?

The two test objects, Twitter search and the above mentioned Twitter widget link, belong directly to the Twitter concept. It offers some immediate navigation benefit to the user. This is what users are after for a long time. Thus, ‘Twitterati’ will click on the links and appreciate the easy way accessing their search service. So, the results Twitter sees with the test don’t reflect in any way potential click rates on text ads as these are dependent on results.

Isn’t there a difference if you promote some internal service or feature, or if you run a promotion from some external party or company? In my experience, in terms of text ads, and those generating results, we can definitely say, there is a huge difference on the click rates. Hence, on the conversion rate clients will find the difference as well. Editorial focus is not comparable to advertising, reaching out for awareness, right? And as clicks is the interactive currency ‘No. 1’ for marketers and convergence their need, according to yesterdays CMO report, the test sounds like comparing apples and oranges.

Spot On!
Nevertheless, the test is worth some thought. And just imagine Amazon and Twitter are getting engaged, the business model becomes clear based on some semantic web thoughts: connecting Amazon’s product catalog by connecting tweets and related products. Someone talks about a film and gets an offer from Amazon in the text ad. Or maybe Yahoo could be the new ‘Who is buying Twitter at last’ as they could compete in the long-tail market. In general, Google could finally face a competitor here…

CMO report: budgets better than expected

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Chief Marketing Officer (CMO) Council’s Marketing Outlook 2009 states that CMO’s see their budgets stable. Almost half of all asked CMO’s (54,1%) say their budgets will increase or at least remain.

What is the value of a click? Obviously, the best deal is transforming a consumer into a customer. For 36% this seems to be the biggest issue: converting clicks to sales and finding the value of online marketing. Just 9% of the chief marketers argue about their online performance capability as being “excellent”.

The outlook in the recession is not too bad… The majority of top marketers answered their traditional marketing focus (print, outdoor and TV) remains the same, and especially digital advertising (also social media and search marketing) will increase. But it also has to me mentioned that 45.7% said their spending budgets will decrease.

“Senior marketers are looking to hold budgets steady and not make tremendous cuts in headcounts,” said Liz Miller, the council’s VP of programming and operations. “Instead, they’re reallocating both their budget and talent into those areas that better engage and communicate with core audiences and customers.”

Spot On!
The loyalty of customer becomes more and more an issue for marketers. Who would be surprised… Those who want to study as deep as possible how the customers thinks, don’t ‘owe’ the sovereignty on customer service and support issues, nor have they big influence on CRM, the survey says.

The question remains why the majority of marketers rely on old online measures (i.e. page views and registrations 64.6%) and not focusing on more modern online engagement opportunities which keeps the consumers with the brands. The most obvious options could be personalization and client first programs (i.e. client opinion platforms or community building) which could replace the old-school “watering cans” techniques. The more companies focus on the client, the ‘happier’ the revenue lines will show.

The report was co-sponsored by Deloitte, Jigsaw and Ad-ology and asked 650 worldwide marketers.

News Update – Best of the Day

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Most of big companies are not really relying on social media, nor evaluating it seriously. Susan Rice Lincoln found some answers why ‘big brands struggle with social media’. She found six reason.

Social Media is…
– … often viewed as just another marketing channel.
– … does not fit into current structures
– … a long term proposition
– … promises no guaranteed results
– … measured differently
and… Communities and content are global and corporations are generally national. – A lot of option if you tackle these issues from the right angle…

In some way Twitter is like a search engine. Have we ever thought on how we use this search option?
Danny Sullivan started a research and – although someone might be there who does not believe in research results – there is definitely a very interesting trend in the findings. Yes, I would say, Twitter is an ‘additional search engine’…

– Half ask a question on Twitter at least once per week
– Nearly 40% are “usually” satisfied with the answers they get
– Half “sometimes” or “often” turn to Twitter for questions rather than a traditional search engine
– Only 4% said they’d give up a traditional search engine for Twitter
– Nearly half said they ask questions on Twitter because they trust their friends or followers more than search results or are seeking expert answers
– 40% said they seek answers to “real time” issues or they want a variety of opinions
– Nearly 70% said questions they asked were related to computer or the internet, followed by 44% asking questions about Twitter, then 41% asking about shopping or product advice

Advertising in a social media world always carries the problem that people might abuse your brand in some unfavorable way. Last week some boys made up the idea in “How to Smoke Smarties”. Adage focuses on this latest YouTube phenomenon and posts some important hints how to handle situations where people are ‘messing messing with your brand online’.

1. Don’t fight it. (Brands cannot control client communication!)
2. Survey the extent of the problem. (Brands need to know how big ‘the damage’ is!)
3. Turn to your social-media crisis plan. (Develop one!)
4. Be open with employees. (Social Media guidelines will help!)
5. Respond accordingly. (All spokesperson should have the official response statement asap!)

Nielsen: Facebook best in reach, MySpace in ads

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The recent Nielsen study ‘Global Faces and Networked Plazes‘ focuses on the increase of social networks in terms of worldwide reach and extension. The results emphazise the rise and importance of communities but also the dynamic of the intention to grap more market share.

Talking of reach, Facebook -the worldwide leader in the social network market- is showing the strongest user base and has replaced MySpace as the world’s most popular social network. Classmates comes in third, followed by Orkut and LinkedIn. The reasons for the facebook success are obvious. According to the study and Nielsen measurement, the win of the Facebook tactic is based on the ‘simple design, broad demographic appeal and a focus on connecting’.

Reports estimate that in 2008 Facebook earned around $US300 million in ad revenue compared to around $US1 billion for MySpace. If Facebook has made a conscious choice to go for the quantity vs. quality strategy it has yet to overtake MySpace in the all-important revenue metric.

So, monetization is still not Facebook best business activity. MySpace attracts more advertisers and gets twice as much campaigns than the ‘Zuckerberg team’.
The Nielsen view on the reasons is that “MySpace’s offering possibly makes its inventory – of which there is a lot more compared to Facebook – easier to monetize, particularly in terms of immersive advertising.”

Finally important, the use of social networks has outdated email as the first way of online communication: 67% of the users show a regular activity in communities.

News Update – Best of the Day

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The fifth annual Digital Outlook Report from Razorfish helps marketers make smarter decisions about their digital media spend – especially in a recession. The latest executive summary of the 2009 DOR summarizes three main statements: Portals continue to lose their grip, social media becomes social influence and long tail TV rises.

Measurement on the spot: How effective are your social media programs? Want to know the ROI of your social media campaigns? Need data on how to make strategic decisions to refine your social media programs? Robin Broitmann has created a ‘Social Media Metrics Superlist’.

Will our business of the future be without email communication, simply done by social networking? Adam Ostrow finds new stats from Nielsen Online showing that social networking has overtaken email in terms of worldwide reach already at the end of last year.

News Update – Best of the Day

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One advice how to find brands and companies on Twitter. Lee Odden knows of 11 advanced and more productive ways that might be helpful when connecting with other brands and marketers on Twitter (via a managed list).

One question every blogger thinks about is ‘Submitting Blogs in Blog Directories’? Ted Demopoulos enlightens the background on this philosophy with some nice insights on how many directories should you enter and what is the benefit.

One post every ‘onliner’ should have in mind in recession times is Nicole Ferraro’s: How to Lose Your Job by Being an Internet Idiot. A lot of good examples that might kill your status of employment. We all do a lot to defining our digital dna but we should be aware that social networking is not everything in our lives…

News Update – Best of the Day

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What’s Google’s next big revenue driver? Capturing one of the biggest markets owned by platform owners? If so, there are 3 things Google needs to make display ads a big business, says Google CEO Eric Schmidt…

“The first problem if you have a display property, it’s very difficult to figure out which ad to show. Because there are multiple vendors who show you these ads. We’re in the process of building the equivalent of an ad exchange which will allow you to do that automatically and do it with scientific measurements. So today what people do is they use heuristics, and the heuristics in that space are terrible.”
“The second issue in display has to do with the standardization of ad formats. There’s not agreement at the level that it needs to be on the standardization of the delivery of the display, and especially around interactive and video ads. The future of display ads is not a static picture, but an ad that brings you in. That tells you a narrative.”
“Third in our case is the construction of the business relationships with the large advertisers, which we’re still working on.”

What’s the future of direct mail spending like in the U.S.? One of the latest reports on ‘A Channel in Transformation: Vertical Market Trends in Direct Mail 2009’ by marketing consultancy Winterberry Group says, the outlook is not positive… Reasons are: recession, rising postage rates and marketing trends – combination is affecting direct mail spending.

What is the new idea on response driven advertising? Barcoded ads! At least Volvo shows a very interesting approach for the launch of their C70 series. The pan-European advertising campaign will include print ads with a specially integrated QR (Quick Response) barcode and uses the print ads to provide readers with instant access to additional web content on their mobile.

News Update – Best of the Day

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Today, we will be serving the ‘How To’-Help – Enjoy it!

How to start a blog and make it effective … Jamie Herzlich knows facts about your competition (130 million blogs on the Internet – according to Technorati) AND has some very good advice that you are not getting lost with your blog.

How to start a corporate Twitter account…. Evelyn So has some interesting ideas on considerations before you dive into Twitterville, taken from a corporate, communication and customer point of view and background. Read comments also…!

How to Get More Out Of Google Docs… It’s on you! If you have the right input, just contribute, log in and add them to the page. Help writing this article. Yes, this is the power of a wiki.

PS: How to Present While People are Twittering? Years ago, people were whispering to each other at conferences, today they are ‘twittering’. Olivia Mitchell knows how to adopt and get attention when you are a speaker.

News Update – Best of the Day

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Wer twittert, läuft schnell Gefahr, die Effizienz und Produktivität seiner Arbeit mit Twitter an den Abgrund zu bringen. Manche trennen sich daraufhin von 20.000 Followern. Es geht aber auch anders. Lee Oden hat 12 Twitter-Stream Aggregatoren zusammengestellt, die aus Twitter einen Freund und keinen Zeitdieb machen.

Enterprise 2.0 ist in aller Munde. silicon.de schreibt mit ‘Gut geplant ist halb gewonnen’ über RSS, Blogs, Tags, Wikis, Intranet und Co. Doch was ist, wenn es um die Umsetzung geht? Unternehmen wissen dann oft nicht mehr weiter. Dr. Berit Jungmann und Stefan Ehrlich zeigen Ansätze, wie Web 2.0 erfolgreich in Unternehmen umgesetzt werden kann…

… und in Krisenzeiten können Unternehmen mit Web 2.0 noch viel mehr erreichen. Wie man strategische Applikationen für das erfolgreiche Business in Krisenzeiten einsetzt, beschreibt Dion Hinchcliffe im ZDNet Blog.

This is a Twitter wake-up call! Well done, Jim…

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Some days ago, I read a comment on another blog moaning “OMG – not another Twitter post!” Bearing this in mind, I now reply with a post to Jim Connolly’s clever decision. The marketing expert who deleted over 20.000 followers some days ago.

So, my comment is…’YES, a critical Twitter article – finally somebody did it.’

One of our editors asked me the other day: ‘Why would you use Twitter?’ I replied…

Imagine you have a mobile phone.
Imagine there is nobody in your address book.
Imagine you have forgotten all numbers.
And, what is the value of your mobile phone in this case? That’s were you start to twitter…

So, I thought about the comparison and came to the conclusion. There is a big benefit of a mobile phone compared to Twitter. The communication barrier which is called the ‘Dial’ button. Although you have a lot of people in your business ‘communication network’, you just talk to them actively when it’s the appropriate time. But people love to listen to Twitter in a passive mode. This is becoming a critical efficiency issue…

Jim summarizes about his future Twitter balance… “BUT this time, I am only following friends, clients and contacts, (which will be quite a large number in itself.)”. Yes, he is popular and back at far more than 500 followers again…

Spot On!
Let me ask… Do we all know what the critical topic with Twitter is? It can be a ‘time thief’ where we spend hours killing the efficiency of our productive work output by trying to invest in our knowledge, in our vanity, in being the first to know and in our ‘trendsetter image’? Ah yes,we can learn a lot from Jim’s decision. It’s a wake-up call, not only for the Twitterati…