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Apple the cool kid with no real friends

Apple is always making the news, keeping them cool in the eyes of the media. If you look at most tech blogs the articles around Apple are usually the most heavily commented on and linked to. In other words Apple is good for the media industry.

In the past week or so news leaked that iOS6 would not be including the YouTube app by default. This doesn’t mean you can’t get the app on iOS, it just wont be on the home screen like you are used to.  Is this big news? Not really, it is just Apple putting a line in the sand against Google and it’s Android operating system.

When I saw this news, I started to think, Apple is really good at making hardware and operating systems. However, they come up really short in content generation and social networking. Google is still the most dominant player in search, online video still has the most widely used maps, and is making strides in the social networking space. Facebook clearly dominates the social network space and is making inroads in to the advertising space.

Apple a few years ago buddied up with who they thought was the coolest kid around, Google. Apple these days is dumping Google in favor for Facebook and Twitter offering OS level integration of the two platforms.

I think to some extent these partnerships are keeping Apple a pure hardware and OS play. If they bet on the wrong partnership in the future this could be disaterous for them long term. If they bought a network like Path, which is tiny in comparison to Facebook, could they push it to greatness or would they mess it up and lose market share? Would any of their acquisitions actually cause them to lose partnerships?

I think getting into bed with Facebook and booting out Google is a short cited move in some ways. As a user, I would love the ability to have both Facebook and Google features by default on my iPhone. I don’t want to be tied to one network if possible, and it would be nice if the social integrations were selectable by the user and not just some corporate lawyers.  In my opinion Apple can gain more consumer market share by allowing more than one network to integrate at the OS level.

Otherwise, Apple will continually go through a cycle of being the coolest kid with the best hardware, but it will also be known as the kid who dumps his real friends whenever something new comes by.

Facebook vs Adsense

Facebook is due to IPO within the next two days and the analysts on the street are wondering how Facebook can keep its current multiple long term.

Is Facebook the next Groupon?

In my opinion, I think Facebook has some interesting plays which could boost revenue in the coming years. Groupon is an accounting mess you don’t want to touch with a 10ft pole.

http://bitcoinsgreece.com/?p=1015 What will Facebook do to grow revenue?

The key here is that Facebook will have major trouble growing its user base past the 1 billion mark. There are just not enough people online in the world to make that grow. Without a dominance in China, they might plateau around that 1 billion user mark.

Also once they become public you will see a marginal decline in users since they may be forced to disclose how many of the actual users are just advertising accounts or duplicate accounts.

Facebook drives most of its revenue via ads. No surprise here. I think this will remain the core for years to come. Here are the pros and cons of their potential revenue models.

get link Mobile

A large portion of Facebook users primarily access the site via their mobile devices. Currently the issue is that the majority of interactions are notifications or action items. You tend to browse more on the desktop version of Facebook. The argument here is that the majority of their display ads are for a browsing type audience. Building new ad units for the mobile user and fitting everything within the 4 inch screen will be tough. The only real spot for an add within a native app is in the feed itself.  Or perhaps Facebook allows advertisers to send messages/emails to the users with relevant ads? Either way, the model is subpar at best.

If Facebook were to release a click to call network, that might be something to watch. Perhaps they acquire a company like Marchex to get that technology.

http://alternativespacetime.com/?attachment_id=1150 TV

People often forget that TV is still a monster of ad revenue. Facebook users are often on Facebook while watching TV. There is a play to be made here. And advertisers know the breadth of Facebook. Will TV shows start broadcasting on Facebook and will there be regular 15 to 30 second commercials on Facebook? Taking this route directly takes a stab at YouTube which we all know has a massive amount of ad inventory which monetizes fairly well.

AdNetwork outside of Facebook.com

One analyst mentioned that he thinks Facebook will start to attack the AdSense model and go after publishers outside of Facebook.com. This is one of the most valid ideas since it can be executed relatively quickly. Publishers have no loyalty to any ad network so there is little switching cost. Facebook already has a strong ad platform, but it doesn’t have much variability in terms of the ad unit sizes. This could be an issue for pubs. The other issue is that Facebook is largely CPC focused, but for publishers the CPM model might prove more effective. Google is clearly more advanced in this sector but they don’t have the social data to increase overall click through rates for pubs.

As the web moves towards being more mobile, this could also present another roadblock for Facebook. Will they be able to make display ads work on mobile partner sites? Does Facebook have a big enough sales team to go after the publishers that work with Google already?

Will having a transparent network be good for advertisers? Will having a transparent network be good for users?

My guess is that people will start to feel weird about Facebook following them outside of Facebook.com. I bet the privacy lawyers at Facebook will hold back revenue growth in some ways.

Facebook.com

Facebook.com still has more inventory than ads, which means the ads show at a very high frequency compared to some other ad networks. This results in a lower conversion rate for advertisers and lower monetization for Facebook.com. They really need to get more advertisers in the mix so users are always seeing something fresh. The burnout rate for ads is just too fast for most advertisers to keep up with.

CPC rates have risen very quickly for the big advertisers but they are fighting for certain demographic groups which convert. Making the long tail of impressions and users will be important to long term monetization for Facebook.

Apps 

Ah, Apps within Facebook. For the app world it makes sense to compare Apple’s app eco-system to Facebook. Apple makes a ton of money by being fairly agnostic of the user interface, they provide a solid hardware platform and simple monetization engine. They also provide fairly consistent growth in their devices which keeps the market growing.

Facebook on the other hand, provides various speed bumps or walls before you can get to your intended content. It also rapidly and frequently changes the user interface which is key to how app developers gather new users. The concept of “social sharing” is a moving target and can sometimes go away completely with larger changes like the Timeline implementation. Products like social readers blew up in terms of usage and died almost as quickly because of the UI changes Facebook implemented.

Consider how much time it takes to build an app, and the costs behind it. If you can’t deploy within weeks, you may actually miss the entire market opportunity. From an investment standpoint, I think investors will be hesitant to put money behind these ideas since they are unable to drive long term revenue or user growth. The other side of this is that developers will get sick of not being able to drive long term revenue with Facebook. They will focus on iOS where things are stable.

If a company like Zynga were to launch today, it wouldn’t work and it wouldn’t be driving 15% of Facebook’s revenue. Facebook is not allowing new products/companies like Zynga to sprout. This could be a serious issue when considering long term growth.

1 billion member affiliate network

Facebook could be on the brink of releasing the largest affiliate network ever. Imagine if it allows advertisers to pay each individual for getting their friends to buy a product or service? There would be millions of micro payments per day and massive fraud. This particular model could put a serious dent into Facebook’s cool image. But people want money and there will always be a group willing to sell their friends.

Search

Google dominates search, and Bing runs a pretty solid site. Bing.com doesn’t need to exist anymore. It can live within Facebook.com and probably grow much faster. Searching for anything on Facebook is a horrible experience. I would bet that most people still leave Facebook.com to do a Google search, and then come back.

Facebook needs to stop people from leaving the site and truly incorporating Bing into the system will achieve that. It will also create a new ad product within Facebook.com which most advertisers are very familiar with. Search Ads.

There are no real costs associated with this strategy. Bing and Facebook already play nice together and are integrated loosely. But having the full power of Bing within Facebook is the better use case for users. Time for Microsoft to let go of this brand and focus on really attacking Google.

I think this proves to be the biggest threat to Google long term. If they lose their foothold in search, it could spell disaster for their entire product line.

 

Google+ Hangouts on Air and EDU

Google just announced that Google+ Hangouts on Air will be available to everyone worldwide.

What is a Google+ Hangout?

Google+ is a Google’s social network which is more based on friend discovery which is different than Facebook’s model of being a voyeur on your friend’s lives. Google+ hangouts allow you to have an online video chat with multiple people at once. Think of it like a giant video conference call.  Quick promo video is here.

The cool thing is that this is 100% free, and you can join anyone’s public hangout. This means you can really strike up a conversation with people you don’t know and potentially learn new things.

Google+ Hangouts on Air is a way for people to publicly broadcast their hangout and save the video recording on their YouTube channel for a later viewing. Some examples of this are here:

Trey Ratcliffe in a Google+ Hangout.

Here is a quick explanation of how to get your Google+ Hangout started:

Why is this important for Education Marketing?

Marketing in general is about questions and answers. (OBVIOUS STATEMENT). Does your product or service help me do X?

Education marketing is largely form based and a one to one approach. I fill out a form, get on the phone with you, ask a bunch of questions and the school tries to sell me on a course.

Leads are incredibly inefficient in some regards. They ask a person to wait for an answer, sometimes the leads are never called back since they don’t meet certain criteria, and you are in a sales pitch most of the time, not a true consultative approach. Another downside for leads is that they require one call center rep to be talking to one person at a time. Lastly, I would bet that most prospective students don’t have a pen and paper to write down their questions and the respective answers. The majority of the knowledge on the call is lost within seconds of hanging up, resulting in more calls or a lost sale.

Being in a recorded communal chat with video has several advantages.

  • The video is recorded – people can review the video again later if they get interrupted. Being interrupted is almost 100% certain given the volume of communications methods we have these days.
  • The questions come from multiple people. One person may ask a question you never thought of. This benefits everyone in the group.
  • Cost delivery is much lower. One trained person can talk to several people at once.
  • Since it is online, you can continue the conversation after the video. It is easy to take the conversation private or continue via phone.
  • It feels more personal since you can see the other person’s face.  This builds major trust with students that are worried about “fake online schools.”
  • The video itself can be used a marketing material. Real conversations are a great way to show your company has a soul and see that the other prospective students have the same worries as you. Knowing you are not alone is a major psychological element.
  • If a person can successfully communicate via a video chat, they should have no problem learning online. Consider this a quick and free test to assess their technical skill level.
  • You can easily assess their grammar level and communication skills.
  • You don’t have to worry about transparency issues. Everything is recorded.
  • No school is doing this now. The first movers here will establish a major market advantage and potentially drive real sign ups versus useless “likes” on Facebook.

What about B2B marketing?

From a B2C perspective, there are many advantages for using Google+ Hangouts on Air for marketing. However, I think there are also major benefits for using this method for B2B marketing of Education technology.

Imagine being able to host webinars about your technology for a variety of market leaders at once? At first you might think this is a bit odd since your competitors might be on the call.  That may be true in some settings but in other settings you might actually receive valuable insight from the other people in the Hangout.

Instead of traveling to expensive conferences, sometimes it is better to get 5-10 thought leaders into a common place and hash out a guideline, talk about a white paper, or talk about some pertinent news. Or perhaps after a conference, the panel wants to clarify a few points, they can easily hold a hangout to further discuss. The conversations should continue after the convention.

Anyway you look at it, Google+ Hangouts on Air has the potential to really enable a lot of new ways of communicating for the B2B world.

Another potential use for this technology is a shareholder conference. I can easily see quarterly shareholder calls going from boring phone calls to interactive video chats so that shareholders from around the world can question management.

 

 

Mobile Advertising 2012

Marin Software put together an awesome report about the state of mobile advertising in 2012. It can be found here.

Some of the most interesting highlights are the following:

  • Google is estimated to generate $5.8 billion dollars from Mobile advertising in 2012. This would represent almost 15% of their estimated 2012 revenues.
  • Mobile currently represents 12% of all clicks on Google.
  • Supply of ad inventory on mobile is still larger than advertising budget. This means low prices!!!
  • 25% of all paid search clicks will come from mobile in 2012
  • Every day 700k Android devices are being activated. This may expand as more Android tablets appear.
  • Tablets represent 45% of all mobile clicks.
  • Mobile clicks are 36% cheaper than desktop clicks
  • SmartPhones have the worst conversion rates of any mobile device. Partially due to most landing pages not being optimized for mobile.

As an advertiser, what does all of this mean? Should this influence your media buy in any way?

With any new trend it is easy to get caught up in the excitement and want to jump on it.

The best way to approach this is the following:

  • Take a look at your Google Analytics to see how many people are coming to your site via mobile devices. If it is very low that might be an opportunity for you to expand it or just ignore it for now.
  • Take a look at some mobile use cases. In a recent report by Yellow Pages you can see what people most often look for on their phones. I don’t think this info is valid for Tablet users though. Does your company fall into these use cases? If not, you can probably wait on mobile. But double check this by asking your customers in real life!
  • Pull up your webpage on a mobile phone or tablet. How does it look? Would you sign up? If not, get a mobile redesign! Also check out concepts around Responsive Design.
  • Set up a test campaign to see if you get any clicks from a mobile campaign. In Google Adwords you can set up a campaign to mobile devices only. If you see a significant number of clicks within a few days you know there is an audience. Build them a flow!
  • Get an 800 number. Most mobile campaigns that do well need an 800 number. Use services like RingCentral.com to track your calls. Make sure this 800 number is different from a number you might use on TV or Radio. This helps with tracking.
  • Set a goal for your mobile campaign. It can be cost savings on your overall paid search buy or it can be something as simple as generate 100 calls. Without that target or goal you are never going to know if this makes sense for you.
  • Lastly – do research to see if your competitors are on mobile already. If they are, see how you can make their landing pages or call experiences better. Don’t re-invent the wheel, just make it go faster!

 

mobile_search_us2012_marin PDF DOWNLOAD

Google Attacks Head Terms through Semantic Search

The Wall Street Journal announced that Google will be updating their search algorithm in the coming weeks/months.

There are some important changes that could affect the lead generation industry that you should know about.

First, what is “Semantic Search?”

Semantic search is basically understanding the context in which you ask a question. This is how Siri for iOS works also.

Example – Lets say if you are talking to your friend about a future trip to Las Vegas. Your friend already knows you love good steaks, so the first thing out of their mouth is “you must check out this steak restaurant at the Palazzo!”

The semantic aspect of this is that your friend has known you for years and knows your likes, dislikes and your budget potentially. They use their own experience to quickly rattle off a handful of things you can do in Las Vegas.

Implications in search.

Most likely you are not having a conversation with your Google page. You enter in short search queries in hopes of researching various topics. EG – “Things to do in Vegas.”

With the new search algorithm Google may recommend a list of things to do and may push down other organic results. It may also determine that a restaurant ad is more relevant to you rather than a flight advertisement.

How does this work?

Google being Google does not release much detail but they say it is based on “attributes” from your personal search history, various websites and other common searches. Google is trying to become skynet in someways.

Why is Google doing this?

Lots of reasons!

  • Google is battling Facebook. They know Facebook’s search is horrible. Most people still need to get info from Google. By making search potentially more context based, it may increase usage of sites like Google+ (this is a really convoluted way to get more users)
  • This user flow is really tailored towards mobile users. Making Google a 1 page website and offering multiple types of results for one search is key to increasing user interaction.
  • This user flow is also great for a voice based mobile device. Imagine calling Google and getting this information read to you? At the end of the call it will ask you to connect to X advertiser. Return of the click to call lead gen model!
  • SEO has created a sea of garbage websites. Google knows no one goes past page one of the search results. Making page 1 more relevant is key for them long term. Creating content for Google via SEO and not users is counter -intuitive long term. They are hoping this allows them to be more useful. Creating a pivot this large is pretty scary. It is like transitioning everyone on Earth from gas to electric cars. You have already built a huge infrastructure around gas, the switching cost is pretty high.

What does this mean for lead generation?

Google is no longer agnostic. They are your competitor and friend at the same time.

Head terms are going to be affected the most. In the WSJ article an early alpha tester said it could change up to 20% of your search traffic. This is huge.

It is hard to say if this is going to affect long tail terms in the short term but if the system learns fast enough, this should have an equal affect for head and long tail terms.

From a PPC perspective, it should technically drop the number of impressions you get. It should technically increase your CTR if your ads are highly targeted. From a conversion perspective, it really comes down to how your ad groups are structured. If they have specific term groups but general landing pages there is an argument to be made that your C2C will actually drop, but that is not a new statement.

What will be the effect on Google’s stock price?

In the short term I can see this potentially lowering revenue. If such a massive portion of your revenue comes from advertising and linking to your index, presenting information before the click should technically reduce revenue.  In the short term I would say there is a dip in their stock price and long term I could see massive growth based on the mobile usage. Most likely analysts will jump on this and push the stock lower to create a lucrative short environment knowing full well that the long term is positive.

This is assuming that they don’t launch any new revenue models like the “speak to connect” ad model. Given that mobile usage of Google is increasing fast, the attention should be really on how can you get in front a mobile user with semantic search. Without knowing more about Google’s Semantic Search, it will be hard to recommend anything at the moment. I strongly suggest contacting your Google Rep for more info.

Thoughts? Comments? If you have an inside line to Google what are you asking them?

Rebecca Black spells the end of Google Search

Google Zeitgeist recently announced the most searched terms for 2011. In the past this list has such celebrities like Brittany Spears and so called Hollywood talent.

This year Rebecca Black, the singer of the Friday song, which has been repeatedly named one of the worst songs of all time. As you all know the video blew up on Youtube.com and became one of the largest viral videos of all time. The video was also noted for the number of dislikes on it. It is probably one of the most hated videos of all time also.

How does all of this relate back to Google? It shows a clear social phenomena that people are viewing things that their friends recommend to them and not actively search for new music online. The rate and speed of which this video grew is a clear indicator that people use technology to “share” things which are interesting. As more and more people share curated pieces of content on sites like Pinterest and Facebook, the world will see a much lower dependence on sites like Google.  I would love to see how many people shared the Rebecca Black video on Facebook versus searched for it in 2011. That would really show the velocity and power behind the social sphere versus the search sphere. Facebook has in some ways taken your real life conversations and put them online and allowed you to share important pieces of content while you are having a real conversation. Google is a system you use after you get home or back to your desk to check out what your friend was just talking about. It is not longer instant.

Google unfortunately is an antiquated way of finding something. It doesn’t recommend anything based on your current activity on the web, nor does it effectively create a way for your friends to share the content they like.

Google+ makes a decent attempt at being real time and merging the conversation with the actual reference media but it also shows you that Google knows it’s search business is under attack. In the coming years, traditional home computer based search on Google will die. People just don’t need it anymore.  Mobile will be replace a lot of the traditional type in search but the monetization of Google AdWords there may be substantially lower.

Google really needs Google+ to work or they need to start integrating their search technology into other devices such as cars to help continue their growth curve.

 

Google adding Facebook Ad Features

Google recently launched a “why these ads” link on your search results page. This link gives users more info about how Google collects information and how they show you ads.  This feature is actually quite similar to the original feature Facebook launched a few years ago and has since deprecated.

I would take a guess and say that the vast majority of people on the internet these days do not fully understand how Google makes billions of dollars each quarter.

In theory the feature is a good idea, telling the consumer more about how things work. Reality is that sometimes people are not ready to know this or don’t want to know.

Also, this becomes yet another “privacy setting” a person has to manage. I really hope someone comes out with a mass privacy setting tool. Now that would be worth paying for.  Imagine being able to set all of your privacy settings across every tool and website you use. It would simplify life incredibly and make you feel comfortable again.