May 13, 2009
Sulphur gas lays ankle deep, dressing the town square like a morbid magic show. The once distant echoes of cannon fire are now a persistent percussion movement, with undertones of service boots scrambling across broken glass and through shallow puddles. All the while, townsfolk play their games and make light of an abominable situation.
MySpace 2010 and the fight for survival.
The final Google ‘mortgage’ payment to MySpace is scheduled for June 2010; US$75m out of a US$900m deal, and the last serious money left in the forecast.
Arguably, this advertising agreement has been the only reason News Corp has persisted with propping up MySpace for so long, leaving the future of the social media behemoth in serious question post-contract. How did we get to this point? 70 million world citizens zipping to and from the mothership, yet no value creation? Actually, there’s plenty of value, its just all subjective and personal, not objective and commercial.
For all its sordid, trivial and intensely personal streams of consciousness, social media (collectively) is a much loved shanty town. Yet, it groans under the weight of rubbish, clutter and poor (and poorly designed) infrastructure. The land lords are going broke anyway, but the cash drain is accentuated by the increasing disengagement of residents.
In April 2008, for example, almost 42% of Facebook visitors also associated themselves with MySpace. In November that same year, that figure slipped to 35%. As of April 2009, just 28% of Facebook users had any association with MySpace (Source: Nielsen Online). This rapid decline in shared audiences between the two has resulted from a massive drop in the monthly MySpace audience and the rapid growth in FaceBook numbers.
In fact since April 2008, Facebook’s monthly AU audience has grown 80%, to more than 4.7m UAs, compared with a 26% decline in monthly UAs for MySpace over the same period to 1.9m. There is an indisputable trend downwards for the once Golden Child of the News Corp empire; a hard lesson which will be taught to every social media poster child - without an objective value, implicitly agreed to by end-users, social media business models have no longevity (or saviour), save for a quick buy-out devoid of due diligence.
Given the diabolical commercial nature of social media, a more interesting philosophical question in this period of bank and automotive nationalisation, would be to ask: should governments (and which governments?) step in and financially support a social media entity - arguably providing an important personal service to hundreds of millions of citizens - if it threatens to file for Chapter 11? And if bankruptcy is the result, what’s the fate of the Terrabytes of data sitting on servers in the rusting warehouses of Cleveland, Oxford and New York?
May 11, 2009
The social media phenomenon has attained a perception of commercial value because of how it has quickly generated a massive world-wide audience within a certain demographic profile. Combined with a relatively intimate framework, social media is now a prolific sub-set to every media buying opportunity.
In short, social media (including that rather quaint term, micro-blogging) has become a type of arterial network through which so much of our 1st and 2nd degree knowledge (friends and family first, interests and curiosities, second) relies.
Attached to these streams of consciousness are product and marketing statements. These commercial elements weave their way through online discussions, opinions and comments, but rarely are they tackled in terms of what value (or lack of it) the associated products receive from being part of this intimate, personalised network.
In the case of the music eco-system, social media has become an integral part of talent discovery, marketing and sales. Because commerce and art are so intertwined in this instance, it is logical that online ‘chatter’ should be measured or indexed, which in turn, produces the necessary insights to affect marketing strategies and sales results.
In this example, Music Sentiment Index or MSI, is now being applied to music artists and their album releases. The MSI is quantifying the chatter in a given time period based on the number of mentions, as well as the ‘quality of exposure’ of each mention. The former is relatively straightforward, the latter, however, less so.
In this case, quality refers to the ‘authority’ number carried by each site, blog and forum; a number based on a similar ‘links-in’ algorithm used by Google, though in this instance, the links originate from social media properties only.
In this example, the MSI for Eminem’s Relapse album in the weeks leading up to its launch on the 19th May has been something of a roller coaster ride, beginning with an initial burst of venom between fans and detractors about the album’s first single release. With traditional news sites blasting out headlines about Eminem’s first album in four years, the blog and forum space went ballistic, pushing the MSI beyond 1,000 in weeks four and five.
Eventually, every product, individual and event with its fortunes tied to social media ‘chatter’, including the leverage of the much-hyped ‘influencer’ segment, will require an index measure to validate performance and an ROI. The really interesting work begins when digital agencies, advertisers and publishers attempt to build MSI-type standards, or a common currency, to allow for benchmarking. Something else to add to the IAB’s to-do list!
May 9, 2009
12 months ago Rupert Murdoch said the media industry simply didn’t understand what the future held for companies like News Corp. It was an admission that said more about the unparalleled challenges of today, with newspapers in particular, trying desperately to derive a net positive result from the digitisation of content.
Fast forward to the present, and by all accounts these problems have only become more acute.What has changed however is Murdoch’s explicit wish not to wait around around any longer to die a death of a thousand cuts, or to be turned into worm food for billion-dollar parasites like Google to gorge upon.
News Corp’s recently announced digital flying squad, represented by teams in London, New York and Sydney, has the remit to end the free ride; to restore order (and value) to an otherwise perverse state of affairs, where the only real source of daily news gathering, which is integral to the entire media eco-system, let alone to a functioning democracy, is being marked ‘free-of-charge’!
The urgency of this task has no doubt been precipitated by the latest 09/10 revenue forecasts suggesting that the online pennies, which have been substituting for offline dollars for several years, are likely to devalue further, perhaps to the level of the Zimbabwean dollar!
The Wall Street Journal (WSJ) is cited as a positive proof point of how charging for editorial content, rather than face up to the full-force of a depression in advertising revenues, can work. The WSJ is also the exception to the rule; its one of those few information sources which have a very clear value-proposition - read me, and you too can drive that Mercedes to your weekender in the Hamptons.
An alternative walled-garden approach is for News to borrow from its Israeli cryptography business (NDS) and build a type of set-top box, or handset that effectively takes its content off the Internet and onto a proprietary network - online and/or wireless; mirroring the success of BSkyB, Sky Italia and Foxtel in becoming subscriber-based information and entertainment systems (with some peripheral advertising dollars). Is it time for News’ print assets to follow the same tune?
May 4, 2009
An interesting article published in the UK last week asked the provocative question: are we drowning in music? In other words, has the currency of music been irretrievably de-valued by the rising tied of mediocrity? (And no, that wasn’t a mixed metaphor).
This post isn’t about to answer that question, but the insight does provides a nice introduction into the world of music entertainment and the growing plethora of online, music-related sites. In Australia, the ranks of music streaming and retail services will shortly be joined by the likes of Guvera, MyDJ and the gorilla of them all, MySpace Music - the latter scheduled for release before Christmas.
We’re not short on services, but what about demand? At what point do we reach saturation where the audience hygiene audience factors start to drop, and in turn, the CPM rates for ad-based music services also start to weaken? But that’s a whole other can of worms.
There are two market metrics Victrix uses here: Nielsen and Comscore. The former suggests online music entertainment has in fact peaked, and now skims along at about 3m uniques a month (March 09) - down from 3.4m in March 08.
In comparison, Comscore considers the glass half-full, and reckons the audience for online music entertainment has grown 21% in the last 12 months, to 4.3m uniques a month (March 09). Again, this isn’t about picking a fight with one or both of the world’s largest panel methodologies; I’ll leave you to ponder the reasons for the discrepancies in audience figures before a more informed opinion is expressed. Both figures exclude online music retailers (and associated applications).
However, where one platform seems to reflect a depleted, almost exhausted market for music entertainment, the other is reporting double-digit growth; not just in terms of the overall sector, but for individual players, including Last.FM - up 115% to 342,000 uniques a month - and even locals visiting MySpace Music (US) - up 72% to 935,000 uniques a month.
Other strong players include MTV Networks (again AUS visitors to US sites) up 60% year-on-year, Universal Music Group up 52%, and the ABC’s Triple J, up 25%.
These audience stats aren’t the makings of an exhausted or confused listening audience. Far from it. In fact, with improved AI and smarter curatorial processes (behavioural targeting), online music entertainment will only evolve into a more relevant service offering.
May 4, 2009
Ok, so Victrix is a little late jumping onto the Twitter bandwagon, but given the hysteria surrounding Swine Flu - with little justification as to why the WHO went to DefCon 5 - maybe a little ‘late to market’ isn’t such a bad policy after all?
This is a case study of how Twitter Intelligence (TI) can sometimes having a profound impact on our (the brand’s) understanding of the consumer’s perspective as well as the questions and concerns which are typically raised in a word-of-mouth scenario.
And this is a major point: I’m not aware of anyone yet describing Twitter technology as a method to measure and monitor word-of-mouth, especially in metric terms such as ‘rate of diffusion’, ‘positive/negative’ sentiment, brand and competitor awareness.
In this example, we have comments, opinions and chats associated with one of Samsung’s most recent mobile phone releases, the Omnia touchscreen. Using PeerIn’s Sentiment Metrics platform we have tracked and quantified these references online - across typical websites, but more interestingly across social media and user-generated content. Included in this catch-all is Twitter communications.
This analysis captures references to “Samsung” and “Omnia” and identifies more than more 20,000 items across blogs (including micro-blogging), forums, websites and news services. In percentage terms, the split is 51%, 26%, 15% and 8% respectively. Micro-blogging, or Twitter, accounts for just over 1% of all comments, which is relatively high for a product-related ‘event’.
However, what it lacks in scale, the Twitter channel more than makes up for in sheer chutzpah. In others words, when you’re limited to 140 characters, your opinions, questions and answers are going to be couched in a very concise, direct and forthright manner. There’s simply no room or patience to waffle, procrastinate or pontificate. Though there’s plenty of opportunity to market, or dare I say it, spam.
In the context of understanding a mindset, the Samsung-related Twitters are pure gold.
“Phones I have my eye on Samsung Omnia and HTC Touch Pro2″
“got lots of games and most importantly a GPS for my Samsung Omnia that is free…holla!!”
“Does anyone want to swap a Samsung Omnia for an iphone?? It would make my day and I would actually think you are crazier than me”
“I returned the samsung omnia and got an htc touch pro…spent all day yesterday unlocking and flashing it…sweet as betch now”
“Goddamn Samsung Omnia. You’ve broken my heart and I’m thinking about leaving you for a Blackberry Curve. It’s not me, its you.”
“Nokia N97 comes with disappointing hardware. Samsung Omnia HD looks better and better every day.”
In these few examples, you have cases of competitor positioning (and awareness) as well as consumer insights into hardware and software configurations.
There are many other examples, but one thing Victrix has learnt very quickly about Twitter: don’t take everything on face value. While no doubt a flexible, responsive and convenient communications channel, Twitter is also increasingly susceptible to astro-turfing techniques, where product placements clumsily infiltrate innocuous Twitter comments. Case in point:
“What a beautiful sunset. I’m sitting by a blue lake and listening to Michael Buble from my Samsung Omnia.”
And you thought the close-up of the Ford badge in Casino Royale was gratuitous!
March 7, 2009
Well, its been almost six months since the last entry on this blog, and I’m pleased to resume my efforts on all matters digital, analytical, and here’s the twist, entertainment-related. The latter is more a reflection of my new role as Managing Director for Peer Group.
September 4, 2008
A cut of 0.25% to the official cash rate and suddenly a mind-shift occurs, sending investor sentiment into positive territory for the first time in many months. This week the index hit 669.42 - up almost 10% in just four weeks - and carried for the most part by strong rallies around digital stocks like realestate.com.au (up 40%) and Seek (up 14%).
Perhaps the latter stock is being bouyed by expectations of higher unemployment figures!
Other strong performers included PMP (up 29%) and Austereo (AEO) up 24%.
While there were very few negative growth figures (with the exception of Village down alomst 10%), most of the high cap stocks were less than impressive, particularly newspaper publishers such as WAN and Fairfax, with both stocks bogged down by aneamic growth rates of 1.7% and 0.73% respectively.
Only in the coming weeks can we be sure that August was the month in which the market bottomed out.
September 4, 2008
Events at the Republican National Convention (RNC) in the US have seriously electrified the blogosphere and comments pages across the Internet. More accurately, it has been Sarah Palin’s introduction to the Republican ticket and her acceptance speech which has created some very serious seismic activity, outdoing even Steve Jobs and his iPhone hyperbole.
From Yahoo!’s poll of polls and TechPresident through to Politicaltrends and Wonkosphere, the measurement of online commentary and sentiment has never been so prolific or detailed. In short, the sudden reframing of this campaign has crystalised some very stark differences between all four candidates across the two tickets, effectively polarising general opinion, and more importantly, reducing the independent vote to a negliable number.
The result? A massive influx of individuals prepared to step forward and be counted by their words, many of whom, it might be assumed, have previously been observers (readers) rather than contributors.
This is a digital scream-fest, consuming the worlds of both UGC and professional media. Every story, video, sound-byte attached to the RNC, and Palin’s speech in particular, is being hammered by both liberals and conservatives with a blend reasoned opinion and out-right vitriol.
And the result? An immediate change in online sentiment, with McCain racing to intersect Obama’s lead. Palin’s introduction has been a game-changing event, for better or worst, and online momentum has resoundingly swung in the Republican’s favour. It is this real-time measurement of opinion (though skewed in so may ways) which acts as a very powerful barameter on issues, personalities and tone.
It also puts into perspective the relatively static social media space, in particular Facebook and MySpace and the weight previously given to such stats as Obama’s and McCain supporters (Obama outnumbering McCain more than 5 to 1 on Facebook and more than 6 to 1 on MySpace).
No doubt there is some correlation between funds raised and friends enlisted, but the true test seems to be whether these ’supporters’ are resolute enough to go in and fight for their candidate as the two party machines open up all guns in a broadside battle? The Palin factor was the opening salvo.
August 31, 2008
Curiously, the innovation investments made in the spaces of search and social media seem to be paralleling one another. Both areas are increasingly recognising need to emphasis quality over scale.
In other words, both platforms have matured in recent years to a point where their diffusion and ubiquity has reached a scale where their value, in terms of search results and the quality of personal networks, is arguably diminishing.
In other words, a tipping point has been reached where diminshing returns are setting in. A response to this system failure (in relative terms), is an increasing range of innovations to do with vertical search systems (or databases) and subject or audience-specific social networks have emerged. Interestingly, the one subject area which is straddling both is health - witness the beta of Google Health and Health 2.0 social networks like Patients Like Me and Organised Wisdom.
In the case of social networks, current set-ups simply do not offer the prerequisite integrity to give members confidence in crowd ‘wisdom’. Every network has ‘influencers’, but in a large scale operation like Facebook or MySpace, their influence diminishes over time for two key reasons: fewer people have confidence in their opinion (diminshing credibility), and they are seen to be less likely to resemble the average member as the network grows.
Further, as the number of nodes in the network increases, the search to confirm an individual’s expertise in a particular subject area becomes more laborious, presenting a real barrier to the ongoing efficiency of the network as a conduit for reliable information. Enter the emergence of specialist social networks.
In the case of health, the trend is being spearheaded by primarily by patients, or at the very least, individuals affected by a particular illness, either directly or via friends and family. This commonality of experience, told through stories, opinion and advice, represents a powerful influence on individuals who feel isolated through a lack of support, or overwhelmed by a plethora of professional advice.
To breach the gap comes social media technologies and platforms operating within a far more specialist environment. As the following graph illustrates, the sources most preferred by people seeking answers on matters of health include the Internet and doctors, followed at a distance by relatives/friends/co-workers.
In this research (iCrossing, January 2008), the Internet was most nominated because it had the ability to put people in contact with individuals and/or their personal stories telling of their own experiences. It is this desire for first-hand knowledge which so completely overwhelms every other potential source of news, and for that matter, comfort.
The Health 2.0 phenomenon represents social media’s ‘higher calling’, far removed from the banalities of current systems.
August 22, 2008
A Red Letter Day. This week the VM Index showed a positive gain - the first time since May 08 - rising to 617.7 after hitting a bottom of 610.80 at the end of July. Despite the glimmer of hope, any portfolio following the index’s weightings would still be almost 40% below water seven months on. Resource stocks these ain’t.
Strong gains by the likes of PMP (+23%), TEN (+9.33%), Austereo (AEO) (+8.5%) and realestate.com.au (REA) (+8.8%), demonstrated that the short burst of optimisim wasn’t confined to one particular media type or category.
Stocks which experienced a less than glowing endorsement included Village Roadshow (VRL) -8.7%, WAN (-4.6%) and Fairfax (FXJ) -0.4%.
