Archive for June, 2008
June 30, 2008
Six months after the VM Index began, and at the end of the 07/08 financial year the body count is massive. Ed Note: there’s no such thing as hyperbole in a market of this persuasion.
In that time, the index has dropped from its baseline of 1,000 to close at 625.99 - a decline of 37.4%. By comparison, Photon Group (PGA) lost 51.5% of its value over the six months, along with TEN down 49.6%, APN down 47.7%, Wotif (WTF) down 47.4% and Macquarie Communications ((MCG) down 42.7%.
No single stock lost less than 20% of its value in this period. Least affected were Consolidated Media (CMJ) down 21.4%, Crown (CWN) down 28.4%, Prime (PRT) down 28% and Macquarie Media (MMG) down 28.6%.
Generally speaking, no particular media segment seems to have been favoured by the market, with print groups hit equally as hard as ‘pure plays’ like REA, Wofit and Seek, along with broadcasters like TEN, Austereo, PBL and to a lesser extent Prime. The broad negative sentiment reflects pessimism around fundamentals associated with consumer discretionary spending, with very little discrimination between stocks based on their delivery platforms - be that digital spectrum, broadband or glossy Sunday magazines.
June 30, 2008
This is why mobile marketing is going to struggle to generate a return, much less goodwill amongst consumers…
This rubbish was served up in the form of a banner ad running on the Techcrunch blog. High marks for audience targeting but the promotion and execution was straight out of the Dodgy Bros. operating manual.
With the incentive of a $500 gift card, the promotion is simply designed to capture mobile phone numbers. It’s not certain if Woolworths itself is behind the promotion, but the brand is prominent enough to give the impression that the company’s marketing department has had some involvement in the sign-off.
Now the rub. Read the following text which appears on-screen after the individual submits their mobile number:
If you enter the received pin you will join the Wixawin subscription service. Stop service? Text ’stop’ to 19993500 | Subscription: 8 msg per month, $2.50/msg each way and $2.50 joining fee. Competition ends 31-12-’08 | Age: 14+ only - ask bill payer’s permission.
In short, for the privilege of entering the competition and submitting your personal details, you’re slugged with a $2.50 joining fee and $20 worth of spam each month! And if you respond to each of those messages, that’s another $20 in fees. Further, to ensure the gift voucher pays for itself 100 times over, the competition runs until the end of year.
That means if you fail to copy down the number to stop this abuse, you’re in for $120 worth of mobile spam when the year’s up, or $240 if you respond to each spam with an abusive text message of your own.
In many ways the mobile industry has no-one but itself to blame for its poor development as a legitimate and valued marketing service. Examples like this put real, constructive mobile CRM initiatives back another 12 months or more.
June 27, 2008
The Beta release of Google’s AdPlanner has many hackers celebrating a type of renaissance in online audience measurement, where to paraphrase the sentiment, ‘Comscore and Nielsen et al are history’! Well, not so fast.
Act 1. There’s little argument that audience measurement products which rely on panel methodology do, by-and-large, underepresent visitor numbers, even for the largest of sites. Further, panel data effectively evaporates as site numbers become smaller, undermining any meaninful analysis of content-specific or niche sites populating the ‘long tail’.
Act 2. Enter the world’s largest publisher, toying with an ambition to provide the market with the most accurate audience measurement system available, supposedly offering objective data across other competing publishers, as well as the plethora of sites hosting Adwords (which can include major publishers as well).
But lets clarify exactly what this audience data actually entails. This from the horse’s mouth:
Google Ad Planner combines information from a variety of sources, such as aggregated Google search data, opt-in anonymous Google Analytics data, opt-in external consumer panel data, and other third-party market research. The data is aggregated over millions of users and powered by computer algorithms; it doesn’t contain personally-identifiable information.
Google Ad Planner demographic information is provided by third-party market research data, opt-in consumer user panel data, and algorithms that improve the demographic estimates.
Google Ad Planner doesn’t use individual site-level information from Google Analytics. Instead, Google Ad Planner uses Google Analytics data in an anonymous and aggregate fashion. Google Analytics data is combined with other data sources to calibrate macro-level insights into website traffic patterns, site visitation across geographies, and related websites and searches.
Can the methodology be any more vague, or less transparent?
Yes the industry needs more demographic depth, and better comparative data using site-centric (ie cookie-based) figures, but this data mash-up using unverifiable data sources seems like a step-backwards, and one which favours sites already aligned to Google’s AdWords network. In other words, if you don’t have AdWords, you’re going to come off second best in the AdPlanner’s “powerful computer algorithms”. How does this help the broader goal of optimising online adspend?
In Australia, Google’s AdPlanner is unlikely to contain demographic data as part of its first release. Instead, what it is most likely to resemble at first blush is Nielsen’s Market Intelligence (MI), which is site ranking platform for specific verticals, including but not limited to, news, sport, real estate, automotive, careers and the like. Combine demographics into this system (through intercept surveys) and you have the AdPlanner concept in practice.
The issue for Nielsen is market reach and a lack of demographic data for audited sites. The number of sites captured by the MI system, for example, is a fraction of Google’s local AdWords content network, leaving many verticals incomplete.
On the flip side, the weakness of Google’s AdPlanner is the perceived conflict of interest, combined with a merky demographics methodology, which seems to have a high degree of extrapolation of what demographics correlate to what sites.
For Australian media planners and buyers, and by extension the much-suffering online publishers, the introduction of Google’s AdPlanner is unlikely to give the market want it desperately needs: a audience measurement currency. In fact, AdPlanner looks set to provide just another audience number with which to compare with a mountain of stats already banking up from the likes of Neilsen Online (MI and NetView), Omniture, WebTrends, Google Analytics and Roy Morgan.
Oh and one more point, if the reports about Google using its toolbar to further massage site numbers/demographics are correct, then that brings into play the audience methodology used by the Alexa group (owned by Amazon), which itself relies on the download of its toolbar to validate audience reach etc. for sites visited by subscribers. Again, not the perfect sampling method.
Oh the humanity of it all!
June 25, 2008
What is the news if its not a barometer of the day’s zeitgeist? But do online news service bother to understand the emotions or feelings of readers and report that back as a measure of community happiness, dissatisfaction, alienation or anger? No.
In fact how do most news portals demonstrate the priorities and preference of readers? By weighting the top stories by clicks or views. Unfortunately, this type of content optimisation is a rather superficial representation of actual engagement with the news of the day, failing to adequately respond, for example, to the emotion of one story amongst a small but passionate audience sub-set.
While the best news organisations maintain a degree of objectivity, wedded to the notion of ‘just the facts’, giving all competing sides an opportunity to vent an opinion in the context of those facts, there is a very real opportunity for these organisations to tap into the associated emotion stirred up amongst readers.
In short, digital news groups need to keep playing it straight, but give audience feedback and commentary a much higher level of exposure, dare I say it visualisation. In other words, to go beyond the boring threads and give real insight into the audience’s passion, anger, delight and shock.
Above is a representation of ‘feelings’ which dominate Australian blogs this past year. The scraping and applet technology developed by the We Feel Fine group, is an example of what digital news groups should be doing to give their online channels real dynamism in the pursuit of mixing fact with audience response.
To date, audience feedback is a neglected resource, crying out for a data analysis and mining strategy that will contribute real value to online news services by way of audience recognition. This in turn will have a significant impact on frequency, retention, engagement, and for the first mover, a very positive brand impact.
Importantly for a news service, there is real value is developing a longitudinal position on these type of data sets, giving the organisation an ability to ‘map’ changing moods across economic, political or social events or cycles. In the following example, the top five most used emotional terms during 2007 (first box) are compared to similar terms for 2008 (second box).
These broad, sweeping aggregates of what online commentators are feeling have their place, but using the same technology to evaluate reponses on particular issues, events or even personalities over a 24-hour news cycle would have a measurable impact on an online news service and its ability to capture the essence of community sentiment.
The identification and utilisation of such crowd-psychology should a cornerstone of a modern news gathering organisation.
June 20, 2008
The VM Index has shed more than 80 points, or 11%, since 6 June 2008, dropping to 651.72. In short, valuations across the board have been decimated, leaving a distinct impression that, despite the broader market malaise, shareholders will be demanding new leadership in several quarters.
No stock experienced anything like positive territory at the close. The top three worst performing stocks included TEN down 27%, Wotif (WTF) down 16.9% and WAN down 13.7%. Both Fairfax (FXJ) and APN dropped by just over 13%, while the least affected included Village Roadshow (VRL) down just over 5% and Seek (SEK) down by 7.2%.
As the above graph illustrates, the ’skyline’ just keeps getting smaller and smaller. The once mighty media metropolis is looking decidely more modest these days.
June 18, 2008
Are SME’s the pragmatists of the marketing world?
In a recent Vector Media Study report, SMEs are proving to be ‘hardheads’ when it comes to digital media. For many business owners, return-on-investment (ROI) is not some recent management fade, but a very real hurdle to further digital initiatives.
In short, when it comes to SME’s adopting new technologies to improve communications, both amongst staff and with customers, there is a real aversion to investing in innovative, but as yet unproven platforms like mobile and multimedia.
A case in point: the Vector Media Study revealed that only 18.5% of SMEs considered mobile to be “very relevant” to their marketing and CRM needs, while almost 35% thought mobile was not relevant at all.
Source: Vector Media Study, N=405
The finding is not that surprising given the lack of case studies available in Australia which demonstrate the successful integration of mobile into business processes, on top of the murky world of mobile data charges.
Where there is a commitment by an SME to increase its communications budget, spend is likely to focus on improving or introducing tried and tested channels like websites, email and search marketing. For example, between the 3rd quarter 2007 and the 1st quarter 2008, the relevancy of search marketing has risen from 36.7% (“very relevant”) to 42.9%.
By contrast, money currently spent on directories like Yellow Pages is expected to decline over the medium-term.
Source: Vector Media Study, N=405
Ultimately, most SME owners are evaluating technologies in the context of how they are likely to improve the business’s CRM. Either the technology is leveraging off existing customer data to improve contact processes or is ‘harvesting’ customer data to optimise the sales pipeline.
Given this background, the study indicates that up to 66% of SMEs are either satisfied or very satisfied with their CRM strategy, with less than 1% “very dissatisfied”.
This highlights how CRM is a key indicator of whether a SME is prepared to upgrade or make a ‘green fields’ investment in digital technology, and goes to the heart of many ROI queries raised by any prudent SME owner or manager.
Interestingly, the study reveals a degree of irony about the alignment of business and digital technologies. When it comes to the question of what SMEs consider to be the most valuable communications channel with customers (particularly B2B), the one element which consistently tops the charts is old-fashioned word-of-mouth (WOM), in other words, the ability to develop positive referrals from customers to non-customers.
Even on the question of how SMEs maintain their market and industry knowledge, WOM is still the leading ‘channel’, ahead of email, blogs, events/conferences, suppliers/partners, general media and direct marketing.
Source: Vector Media Study, N=405
Indirectly, this insight goes to the heart of what digital can potentially mean in the context of SMEs. That is, digital technology is above all a networking mechanism, offering businesses real scope to design and develop systems that play to the strengths of WOM.
For all their cautiousness, SMEs are probably in the best position, ahead of much larger institutions, to leverage real ROI against a digital networking strategy.
June 16, 2008
Content analysis is an important measure for trending issues, identifying emerging behaviours or simply as a way of sourcing competitive intelligence.
Yet, its a methodology very much under-utilised, if for no other reason that there is a degree of ambiguity around what value can be derived from the exercise.
Take the following example. A news item about the federal parliamentarian, Belinda Neal, and the furore generated by her alleged behaviour and alleged cover-up of the alleged incident has been reported in every metropolitan newspaper in the country. In this context, a method of content analysis is to tag cloud the copy and compare the key themes and actors of each paper’s coverage.
Both the SMH and the Australian run a very Rudd-centric approach, emphasising the embattled Neal and the possible abuse of parliamentary privilege. The Australian goes further on the issue of parliamentary tactics, and dredges up a previous misdemeanour of Neal against another parliamentarian (Mirabella MP).
By contrast, the Daily Telegraph (DT) goes hard on the staffers involved (Batten, Hartcher et al), running the line of possible political influence in the drafting of the statutory declarations. With an eye to where this story is heading, the DT emphasises the police investigation currently underway.
These three clouds are an example of content analysis at a micro-level, quiet apart from the opportunity to cloud entire sites, allowing the visualisation to provide a quick assessment of the themes and treatments adopted by competitors, the media generally, and in particular, individuals contributing via UGC.
A more sophisticated approach would monitor for changes to a competitor’s tag cloud (set up internally), giving alerts for changes in the scale of particular words, as well as for terms which enter and exit the cloud itself.
June 15, 2008
In the over-exposed setting of Cannes this week, Justin Milne, BigPond’s CEO, announced a mobile advertising strategy that is certain to have consumers cramming the exits looking for the nearest Optus reseller
His goal is to offer the Australian marketplace the most sophisticated, most complex system of ad targeting there is anywhere in the world and will use Telstra’s 3G network to deliver the capability.
His behavioural targeting utopia is to triangulate the individual’s location, mobile and online data, then overlay that with some trusty customer segmentation of its own, to arrive at some quantitative assumption (read: scoring) about a person’s purchase intentions.
Based on this theory, an individual with a Telstra 3G handset, who’s walking down Norton St in the Sydney suburb of Leichhardt, for example, would receive a Yellow Pages ad for a local restaurant, perhaps with a discount offer to sweeten the deal.
That ad could be based on any number of variables, including the fact that the person was in the general vicinity of the restaurant, or they had previously searched for “restaurants” on their mobile browser, or had browsed a website like CitySearch, or from a socio-demographic perspective matched an ‘urban sophisticate’ profile. Of course, the ad could also be triggered by any combination of these four elements.
The question will be how each ‘input’ is weighted to ensure the system has optimised to reach a person with a high enough propensity to buy a meal at the restaurant. Without the ‘smarts’ to do this, the likelihood of the person taking up the offer will be relatively low, and the restaurant will have waste significant advertising dollars on a very expensive targeting system (relatively speaking).
Milne’s ambition is admirable. His system is world-class (in a theoretical way), but there are some obvious holes in the data architecture sitting behind the system, not the least being how to capture online data to fit into the subscriber’s profile.
How does BigPond get its hands on data generated from non-Telstra related websites? If I’m a frequent news.com.au reader, with a penchant for restaurant reviews, how does BigPond know this, and if it doesn’t have access to this type of third-party data (online or off-deck in a mobile context), isn’t this already undermining the integrity of the ad targeting system, and therefore reducing its value to advertisers?
At best, BigPond is likely to have access to very limited subscriber data, as well as stats re: on-deck behaviour, perhaps data from third-party, off-deck sites (with permission), and perhaps (and it’s a big perhaps) data from Telstra-related sites (like White Pages, Citysearch, Whereis etc. And we’ll conveniently ignore the issue of cookie deletion). The only reliable data point in the whole system will be a geographic fix on the owner’s handset.
As for customer segmentation methods (like Roy Morgan, Mosaic or some other proprietary system), these are simply too broad and too generic to add much value by way of specific ad targeting.
This is the trick. A number of consumer research pieces indicate that individuals are partial to advertising delivered either online or via the mobile handset so long as it meets their criteria for relevancy, ie, it matches an actual need, either immediately or over the medium-term.
If BigPond gets this wrong, and the advertising becomes both frequent and inaccurate, then this so-called media player will be in a whole world of pain.
June 12, 2008
It’s the stuff of Greek tradegies.
Social media, and ancilliary baggage like software, content and services, are based on high context communications. That is, our associations and discussions in a social media environment capture our full attention (or devotion) for the time we are engaged in this space.
It is because of this level of engagement, both for personal or professional reasons, that these social/professional networks play an increasing role our our very networked lives. Yet it is precisely because of this engagement between people in a digital network that efforts to monetise social media audiences are on a road to pedition.
A high context environment, like a social network, is stoney ground for advertisers and brands. A majority of uninvited third-parties (to put it bluntly) are being ignored by 99.96% of the community simply because members recognise that there is no motivation for brands to engage with consumers other than to transact. Its clinical, technical and transparent. These are not motivations that sit well in a high context environment.
A brand will never carry the tag “friend”.
That said, there is a relatively small but well-funded financial community in the US desperate to do a deal in the social media space, or at the very least protect the value of their existing social media-related investments, by talking up the sector’s current prosperity and future potential.
In the period between January 2007 and March 2008, (according to transaction figures obtained from Paidcontent.org) more than US$3.1b was invested in a range of social media categories. From content and mobile, through to software and networks themselves, close to 400 investments were made at an average value of US$8.1m.
Of that market, media creation and sharing (i.e. applications) dominated the spend, just ahead of social networks. While these figures are pre-credit crunch, the pace of investment (at least up to March 08) has remained consistently strong over the last eight quarters.
On the flip side, M&A activity over the same period in and around social media surpassed $13b, and could be high as US$16b, covering up to to 131 deals. The largest of which was AOL’s takeover of Bebo at a cost of US$850m in cash; a deal which AOL is apparently regretting now, particularly given Bebo’s relatively small (and decreasing) market share in the US.
In terms of some type of league table, the M&A activity was dominated by Internet Brands with seven acquisitions, with Yahoo! following on five. Disney, Handheld Entertainment and Google stand next with four acquisitions each.
In this rush, the best gold seams have already been exhausted, yet prospectors keep arriving with hope in their eyes. Yet, as history tells us, the only people to profit from this stage of a fast maturing gold rush are the store keepers and saloon operators, not the guys sinking the shafts!
June 8, 2008
With little in the way of measurement standards, let alone an audience currency, the Australian market could do no worst than take a peek now and then into the Alexa audience figures.
Although based in the US, Alexa has an Australian sample of between 6,000 and 8,000, which means the standard is potentially 80% to 100% more accurate than Nielsen Online’s NetView panel which currently dominates Australia’s media planning industry.
The reporting, however, doesn’t provide reach or ranking by nation, only a single global list, so local sites are essentially ranked against hundreds of thousands of sites worldwide. Nevertheless, when comparing one Australian site against another, the relativities are still powerful indicators of market performance.
Take the following example which compares the top three automotive sites in Australia - Drive, Carsales and Carsguide. In terms of audience reach, both Drive and Carsales are relatively close, and execute similiar trends. By comparison, Carsguide almost flatlines, with a singular dip in early February.
Interestingly, the Alexa data also indicates that a signficant percentage of people who visit Carsales also visit Drive, hence the shared trend in audience reach between these two sites and not Carsguide.
While the top two sites in this comparison are close, when the analysis shifts to page views, the difference between the two sites widens considerably.
On this measure, Carsales is streets ahead in terms of page impressions, while the other two sites are relatively similar. It’s a fascinating reflection on such audience metrics as time-on-site, average search queries per user or simply database size. Whatever the implication, the Alexa sample is indicating some very significant qualitative differences between the three sites.
And regardless of how accurate Alexa is as a representative sample of the Australian Internet population, the sheer size of its panel (relative to anything else available in Australia), gives definite analytical weight to the relativities between competitive sites as they appear in the data.
For Australian media professionals, this added dimension to online analytics is a crucial component to their market intelligence.
