It was only last month that eMarketer said Facebook’s ad sales for the year would likely total $1.2 billion. In a report today on the state of the overall ad market, Cowen & Co. analyst Jim Friedland says he expects that number to actually total more than $1.6 billion and non-ad revenue to bring Facebook’s overall sales to nearly $1.75 billion for the year.
Friedland expects Facebook’s U.S. ad sales to total $1.05 billion and international ad sales to come in at roughly $500 million. eMarketer put U.S. ad revenue at $835 million and worldwide sales at $450 million. Next year, Friedland expects Facebook’s ad sales to total $3.2 billion, nearly double what eMarketer is expecting.
Facebook has never disclosed its revenues, although CEO Mark Zuckerberg told InsideFacebook in June that outside “estimates are not so far off in either direction that it’s causing us any pain.” That publication also reported today that Facebook is now showing four ads on many of its pages, instead of three, which when coupled with the site’s incredible user growth, should keep the numbers going up.
COMMENTARY: Just how does this Cowen & Co analyst Jim Friedland know what Facebook's revenues are going to be.
Courtesy of an article dated September 29, 2010 appearing in paidConteng.org
In a lab experiment designed to see whether the company could play a role in the emerging market for airborne wind, Honeywell engineers concocted a design for a flying wind turbine that is capable of generating 2 megawatts, which is largely based on technologies from unmanned flying vehicles it makes for the Department of Defense. The body of the turbine derives from the Predator B, while the auto-navigation and other electronics come from spy drones like this and other devices.
It hasn't been built -- Honeywell has only produced a detailed computer simulation -- but the basic components exist and the design shows what might be possible.
Honeywell Airborne Wind Turbine Concept (Picture from Simulation)
"Technologically, it is not an issue," said Eric Blumer, director of advanced technology, engines and air management research at Honeywell, at theAirborne Wind Energy Conference taking place at Stanford University
Expect to see more concepts like this. Airborne wind -- turbines that fly in the sky and harvest energy from atmospheric wind -- has the potential, say proponents, of reducing the cost of wind power. These turbines, hypothetically, could also generate power more consistently than ground-bound turbines as well because of the more consistent winds that are present higher in the atmosphere. (That's a picture of the simulation, by the way.)
Joby Energy Airborne Wind Turbine Concept
Are there hurdles? You bet. Only small prototypes exist. Airborne turbines will have to survive strong gusts, ice and unpredictable weather, and neighborhood groups will likely object to multi-ton devices twirling over the earth connected to shock cords that measure a kilometer or more in length. Utilities, the main customers, also have their hands full with trying to get permits for conventional solar and wind parks. Still, if these devices work, it could become a growth market for aerospace companies like Lockheed Martin, Honeywell and Boeing. Many defense contractors have already moved into solar and smart grid: you can call it the Utility-Industrial Complex.
Magenn Power's Magenn Air Roter System (MARS)
"A wind turbine costs $5 a pound. An aircraft costs $500 a pound," said Fort Felker, director of the National Wind Technology Center at NREL. "We want the low cost of turbines and the reliability of an aircraft."
The Honeywell turbine would measure 57 feet across and carry two one-megawatt turbines. In 34 MPH winds at 5,000 feet, the device would travel at 172 miles per hour and generate a megawatt of energy. The generator sits in the back of the device to add stability. The tether that connects it to the earth would come from Honeywell's material science division.
Makani Power's Air Wing Turbine (AWT) M-1
"Because of the trailing turbine, you have to work hard to go out of control," he said. If it became untethered, it would fly in lazy figure-eights. "This thing likes to fly. The stall speed is low," he added.
If it's so good, why doesn't the company go forward? For one thing, Wall Street analysts would beat them up.
Sky Windpower Corporation's High Altitude Windpower
"We can't do the VC thing. We have to go into established markets," he said. "Aerospace is a growth industry. If this grows it, we're all for it."
At the other end of the spectrum is the "shrouded turbine" from Alteros Energies, a company formed last December by MIT and Harvard students. It looks like a giant, inflatable donut or a cuttlefish with a propeller in the middle. The shape of the device forces air through the opening and into the turbine; a similar turbo effect is being harnessed by the ground-based turbine from FloDesign, another company with MIT roots. It stays aloft because it's filled with helium. The lighter-than-air design means that turbines will cost 25 percent less than standard offshore turbines, according to co-founder Ben Glass.
Conventional offshore wind, he added, is not cheap. Onshore wind turbines can now produce energy at around 9 cents per kilowatt-hour. Turbines in shallow waters offshore produce electricity for around 13 cents, and with turbines in deeper water, the price rises to 18 cents. The foundation used to secure offshore turbines can gobble up 25 percent of the capital.
Alteros has produced a design prototype (see photo) and hopes to have a structural prototype by next spring. If all goes well, it could have a working 100-kilowatt prototype in 2012.
COMMENTARY: As you can see from the above images and videos, airborne wind turbine technology is still very much in the concept stage. A companies like Magann Power and Makani Power have actually built experimental proto-types, but these are still very crude. Those airborne wind turbines are able to fly, but are a long ways from generating electricity.
I find airborne air turbine technology quite interesting and nove, but considering the cost and generating inefficiencies of regular ground-based wind turbines, certainly viable if the technical and environmental hurdles can be overcoe. Unfortunately, airborne wind turbines are least ten years from actually producing electricity, and who is going to fund them remains to be seen.
Courtesy of an article dated September 29, 2010 appearing in GreenTechMedia
In this new weekly chart -- a collaboration between Advertising Age and real-time buzz tracker OneRiot -- we monitor discussions on Twitter, Facebook, MySpace and Digg, and present the good news and the bad news for big brands with current social-media buzz.
ABOUT THIS CHART: OneRiot has created a proprietary Trending Topic Engine that surfaces stories trending right now across Twitter, Facebook, MySpace and Digg. Advertising Age parses brand-related data collected by OneRiot over a one-week period, assigns a "spin" to each story based on the nature of the prevailing coverage, and selects a "key source" from among the news outlets whose links are being shared most widely on the social web. For more about OneRiot, including information about RiotWise, its real-time advertising network, click here.
COMMENTARY: Bad news for those three brands. I don't feel any pity for McDonalds. Cutting health insurance for 30,000 overworked and underpaid employees really sucks especially during these bad economic times. McDonald's is making one hell of a profit so picking profits over employees is the epitomy of corporate greed. I have a feeling a lot of companies are going to cut health insurance before the Obama Health Care Reform bill kicks in. This really pisses me off. No more Big Macs for me. I am boycotting those corporate bastards and hope you will too.
Courtesy of an article dated September 30, 2010 appearing in Advertising Age
You didn’t think Facebook would integrate with Google (GOOG) Voice, did you?
Actually, according to sources close to the situation, Facebook and Skype are poised to announce a significant and wide-ranging partnership that will include integration of SMS, voice chat and Facebook Connect.
The move by the pair–which have tested small contact importer integrations before–is a natural one for the social networking giant, which is aiming to be the central communications and messaging platform for its users, across a range of media.
Facebook’s goal, according to sources: To mesh communications and community more tightly together and add more tools to allow users to do so.
Since it was not going to create an Internet telephony service of its own–kind of like not creating a mobile operating system–Facebook has apparently turned to the Web’s Internet telephony leader.
Interestingly, Facebook has previously tested a video chat product.
Skype had 124 million people using it at least once a month and 560 million registered users, which will be bolstered by the 500 million Facebook users who will now be able to use it more seamlessly within Skype.
That will include allowing users to SMS and call Facebook friends from Skype, which will now deploy Facebook Connect.
And also do video chat using Facebook in Skype, which you can see below, in a very odd screenshot sent to me by a source–Walt Mossberg’s code name is not Daniel Matthews and I am not Allison Brown. (Click on the image to make it larger.)
This all will be available in Skype’s newest version, 5.0, which emerges from beta in a few weeks.
While it now dominates the online calling space, it needs to be present where users are now moving, such as Facebook.
And for Facebook, this is also helpful to its international push, making it more appealing globally since Skype is much more popular outside the U.S.
It will be interesting to see if both cross-integrate into their popular mobile apps too.
Facebook has been doing a lot of integrations with other communications services, such as a massive upcoming one with Yahoo (YHOO) and also one with Microsoft (MSFT).
Skype is also increasing its partnerships. Today, for example, it will announce a deal with Avaya, which makes office phones and related software aimed at businesses.
The pair called it a “strategic unified communications and collaboration partnership,” and is centered on business and personal videoconferencing.
COMMENTARY: The Facebook and Skype partnership is a good strategy and a win-win for both online sites. Mark Zuckerberg would like to grow Facebook to 1 billion members. The only way he can add 500 million new members is internationally, where most of the new growth is coming from. Skype is also a good fit for the much anticipated Facebook "social" smartphone, who no doubt will be using their Facebook phones to make calls through Skype.
Facebook is now a global social network, and members communicate through instant messages and email. Adding Skype increases Facebook's value-added service offerings especially Skype's one-on-one calls, video-conferences and conference calls. A lot of business is transacted internationally, and Skype stands to add millions in revenues from those calls. You can bet Facebook will get a piece of that revenue and this will certainly help Skype and Facebook when they go public.
Courtesy of an article dated September 29, 2010 appearing in D All Things Digital
Crowdsourcing is all the rage these days, another aspect of the cloud computing proliferation that has companies doing crazy things. Even if you have never heard of it, you have probably purchased a product that was developed using crowdsourcing or have been directly involved yourself.
DEFINITION: Crowdsourcing is the outsourcing of idea generation or tasks that would normally be tackled by employed workers or contractors for a particular company. The task or idea is outsourced to the masses via the Internet or social media technology.
Crowdsourcing can be more than just a task or an idea. In general, if it brings benefit by bringing together many people for a common cause, there has been some successful crowdsourcing. One such example is daily discount provider Groupon. The upstart Web-based business sends daily emails to subscribers who can purchase a coupon for a particular service or product. So what's the hitch? The discount only kicks in if a set number of customers purchase the coupon, bringing together the purchasing power of many through crowdsourcing. Groupon is not a public company, but it was recently valued at more than $1 billion by Blue Sky Technologies, a Russian venture capital firm that purchased a small share of the business. [NOTE: See my previous post about Groupon]
See, crowdsourcing is fun and it can be very profitable and cost favorable for many companies. This is why the trend continues to grow. Let's have a look at how some other companies are using crowdsourcing to their benefit:
salesforce.com (Nasdaq: CRM) - Salesforce.com is one of the undisputed leaders in the cloud computing space, and it has used its expertise to build and acquire successful crowdsourcing ideas and applications. The company recently purchased Jigsaw, a large crowdsourced business contact database. Salesforce.com has combined the platform with its popular Chatter application to provide clients with a Facebook-like community for the business world. It updates in real time contact information, projects, data reports, etc. The application has more than 4 million company profiles and 22 million business contacts. The application is kept up to date daily by a community of more than 1.4 million users. Companies such as Nokia and Dell have used Chatter for years to help the companies become more profitable.
General Electric (NYSE: GE) - General Electric's Ecomagination Challenge is using crowdsourcing to create eco-friendly business ideas. According to the company website, "GE's Ecomagination Challenge is a $200 million call to action for businesses, entrepreneurs, innovators, and students to share their best ideas and come together to take on one of the world's toughest challenges – building the next-generation power grid to meet the needs of the 21st century." The company has received almost 3,000 entries so far, and the site has more than 38,000 users competing for the $200 million prize. The contest ends this week. It is not certain how General Electric will ultimately select the winners of the challenge, but the company has set up user voting on the site that may play a role in the final determination of winners. Sony (NYSE: SNE) recently launched a similar crowdsourcing effort with the World Wildlife Fund. Their contest does not involve creating new products and ideas, but to use existing products in more efficient and environmentally friendly ways. It should be interesting to see what type of participation there is for this contest because no prize is being offered.
Omnicom (NYSE: OMC) - Omnicom-owned public-relations firm Ketchum is using the brainpower of communications and digitally savvy college students across the world to help the company solve client, as well as internal, problems. Ketchum and selected clients will reward students who participate with career coaching and developments, job alerts and contacts, as well as offer monetary rewards for selected ideas. Crowdsourcing has created a way for companies like Ketchum to receive extremely low-cost consulting efforts, while helping students in a terrible job environment make connections and gain experience. The first crowdsourcing opportunity is designed to help Wendy's/Arby's(NYSE: WEN) find the most creative ideas for a new product launch.
The Foolish bottom line - Crowdsourcing has created a way for companies to generate new business ideas at a low cost, while also providing opportunities for people with different skill sets in a very slow economy. It is a win-win for just about everyone involved in the process. I like companies that use crowdsourcing as it shows it is connected to the community and willing to work outside the corporate box to generate ideas. In the ego-filled, slow-to-change corporate world that may be saying more than you think.
COMMENTARY: I like crowdsourcing so long as corporations do not rely on this type of social forum for creating competitive advantage at the expense of the individuals who contribute valuable ideas, work for free (like interns) and generate buzz for the corporation. It's a sort of corporate "pick your brains" strategy.
The practice of "picking your brains", a form of "free riding", is encountered in the consulting industry, with individuals pretending to be interested in a consultants professional services, but are really interested in utilizing the consultant to help them gain answers to their marketing, manufacturing, operations, and funding strategies. Once you bring up the issue of charging for your input, you never hear from them again. I just severed relationships with a business acquaintance, a supposed venture capitalist, for trying to get some free deal flow and advice on structuring some deals.
I am surprised that LinkedIn, one of the biggest sites for crowdsourcing, was not mentioned. Professionals, even consultants like myself are often "brain picked" for answers to business and marketing issues. I am a LinkedIn member, have been for years, and am not opposed to crowdsourcing, but I often encounter the same cast of characters asking for ideas and answers to questions that we often charge professional fees for.
Crowdsourcing has also given way to crowdfunding, where an entrepreneur can raise capital through small donations through a social group of fans, investors and philanthropists. Some entrepreneurs have been able to raise as much as $100,000 through crowdfunding.
Courtesy of an article dated September 28, 2010 appearing in The Motley Fool
VCs like to boast about the potential winners in their portfolios, but Battery Ventures founder Rick Frisbie is circumspect about Groupon Inc., one of the hottest consumer Internet companies.
Battery invested in the two-year old shopping website last April in a $135 million round led by Russian investor Digital Sky Technologies that valued the start-up at $1.35 billion. Asked about Groupon Tuesday during his induction into the Private Equity Hall of Fame at the Dow Jones Private Equity Analyst Conference, Frisbie said the company has a lot of competition and its leadership position in the deal-of-the-day market might not be defensible.
“I’m still not absolutely convinced that Groupon will be the kind of success we hope it will be,” he said. Nonetheless, “it was too big an opportunity to pass up.”
Frisbie, who started Battery in 1983 with two partners, said the venture firm had looked at the group purchase market for a couple of years and had come close to backing Rue La La. But before Battery could invest the private sale site’s parent company, Retail Convergence, was acquired by GSI Commerce Inc. in a deal worth up to $350 million.
Battery looks at a company’s ability to defend its turf and its exit prospects in tandem, Frisbie said, and Groupon might be hot enough to go public or bought before competitors can gain much ground. He said the problem with the venture industry over the last decade has been too much money chasing too few opportunities in a stagnant economy, as reflected by public-market performance.
Frisbie also said the explosion of a class of investors known as super angels is not helping the venture market because they are looking for the same kinds of digital media companies as VCs. “Less competition is good for me,” he said. “I would prefer not to see the super angels out there because they’re competition.”
Venture capital has gone through cycles when it has been broken, Frisbie said. “I think that it actually was broken over the last decade.” What he’d like to see is a healthy public market, not necessarily because IPOs are key to successful venture exits but because they reflect a robust economy.
“Without the public markets, we’re in the business of grinding it out,” he said, looking for three times or four times returns.
COMMENTARY: According to a Rice University Study Groupon's business model is broken and in a process of slow decay. Here's Rice University's Study findings:
Daily-deal site Groupon skyrocketed to stardom in just two years, generating hundreds of millions of dollars in revenue and inspiring a number of copycats. But this flourishing group-buying model isn’t a guaranteed revenue driver for the participating local businesses, according to a recent study by Rice University.
The study from the university’s s Jesse H. Jones Graduate School of Business looked at promotions offered by Groupon, which features a daily deal for each city in which it operates and offers consumers a significant discount for a local good, service or event. The discount is valid only if a minimum number of consumers purchase the deal.
The Rice study found that 66% of the 150 merchants responding found the program profitable, while 32% said they were unprofitable. Forty percent of the respondents said they would not run such a promotion again. Groupon founder and Chief Executive Andrew Mason recently wrote that 97% of its merchants want to be featured on the site again, showing quite a discrepancy in their numbers and those found by the study.
Groupon, touted as one of the fastest growing businesses ever on the Internet, has received backlash from merchants recently who were not satisfied with the outcome of offers on the site. For example, the owner of Posies Café in Portland said in a blog post that Groupon is the “single worst decision I have ever made as a business owner.”
The owner criticized Groupon for not putting limits on the number of coupons it sells and taking too high a percentage of those sales. “There came a time when we literally could not make payroll because at that point in time we had lost nearly $8,000 with our Groupon campaign,” the owner wrote. “We literally had to take $8,000 out of our personal savings to cover payroll and rent that month. It was sickening, especially after our sales had been rising.”
The post traveled the Internet like wildfire and drew a quick response from Mason who explained that the company never prevents merchants from capping their deals. He stressed the company’s diligence in making offers valuable for merchants and consumers alike. However, it seems the success of a campaign also depends largely on the satisfaction of a business’ employees.
“Satisfied employees” is the most important factor for the Groupon promotion to work successfully for a business, according to the study. If employees remain satisfied through the promotion, the likelihood of its profitability is significantly higher. The percentage of discount offered and the number of Groupons sold did not predict the deal’s profitability, nor did the percentage of Groupon users who purchased beyond the Groupon’s value or purchased again at full price.
“Because the Groupon customer base is made up of deal-seekers and bargain shoppers, they might not tip as well as an average customer or be willing to purchase beyond the deal,” said Utpal Dholakia, author of the study and associate professor of marketing at the Jones School. “So employees need to be prepared for this type of customer and the sheer volume of customers that might come through.”
Other findings included:
Among the service businesses, restaurants fared the worst and salons and spas were the most successful.
Businesses with unprofitable promotions reported low rates of spending by Groupon users beyond the deal’s face value and low rates of return to the business again at full price.
Respondents indicated they had largely negative perceptions of Groupon’s competitors.
“I think these findings show that social promotion companies need to better balance consumer appeal with positive outcomes for the small businesses offering them,” Dholakia said. “Right now, these deals are tilted too far in consumers’ favor.”
The daily deal space as attracted quite a few Groupon clones, understandable considering the company’s valuation crossing $1 billion. Other venture-backed companies offering similar deals include LivingSocial Inc., BuyWithMe Inc. and Bloomspot Inc. Public companies such as Travelzoo Inc., OpenTable Inc., and The Knot Inc. are also chasing the trend.
Dholakia conducted surveys with 150 businesses spanning 19 U.S. cities and 13 product categories that ran and completed Groupon promotions between June 2009 and August 2010. Groupon, which has raised at least $170 million from Accel Partners, Battery Ventures, Digital Sky Technologies and New Enterprise Associates, features about 330 deals in more than 230 markets worldwide.
Wow, it sure sounds to me like Groupon's business model is not a win-win situation for its customers, many who are losing money on their discount deal promotions. In order to succeed in discount coupon promotions, there has to be a return-on-investment on the deal, otherwise why do it. If so many brands are pissed off, this does not bode well as a sustainable business model. It is slow decay as unhappy customer's go for the exits. Groupon better do that IPO real damn fast.
Courtesy of an article dated September 29, 2010 appearing in The Wall Street Journal's Venture Capital Dispatch
We often focus on engaging teens. After all, this newsletter is titled "Engage:Teens." Let's be real though: teens aren't always your customer. More often than not, their parents -- who are footing the bill -- are your customer. This doesn't just apply to big-sticker items like laptops; a teen might have the cash for a can of soda, but wouldn't you rather sell them a case for $8.99?
To make the sale, you need to take a multi-pronged approach that sparks teens' interest and educates those purchasing the product or supplying the funds on why they should listen to their teen's request.
Step 1: Understand the continuum.
In the '50s you could run one ad that contained everything: branding, product benefits, and promotions. "Buy Coca Cola at your favorite store because it's refreshing and your friends are doing it." But this is 2010, and when marketing to teens, you really have two consumers, the teens themselves and their parents, and they typically are interested in brands for different reasons. Product awareness, education, and other purchasing drivers need to be separated and marketed differently and smartly.
Use your awareness play on teens, as they need to be interested in your brand. Is it cool? Do their friends think it's cool? Does it fit their lifestyle? Parents, on the other hand, are going to care more about product attributes. What does it cost? What's the sugar content? Is this product good for my child? Focus on education and key promotional points with parents or those responsible for purchases large and small.
Step 2: Location, Location, Location.
Consider where each segment -- teens and parents -- views marketing messages and reach them with tactical executions and media buys. Don't neglect the importance of positioning your message in the right channels. For teens, stick to the "cool" stuff. They tend to be tech savvy and get their information through emerging channels.
While you can reach teens by building an app, engaging them on Facebook, or sponsoring a tour, their parents are just coming around to these new channels, and are still more accustomed to receiving marketing messages through traditional channels. To reach those making the purchase, i.e. their parents, stick to tried-and-true methods like TV spots or print ads. It's okay to experiment with different channels, but if you're looking to be hyper-targeted, pay attention to the channels that work best for each segment.
Step 3: Make the sale.
When either consumer takes action, be ready. Obvious, right? Not so fast. Advertisers have only recently started paying attention to mobile advertising and most websites are not mobile friendly. When a teen on the run remembers your brand, they're most likely to search for it online and on a phone. Make sure that when they search, you're there and ready to embrace them with open arms. The teen may not be in a position to make a purchase, so when they ask their parents for money, be sure that your message and product benefits are already seeded with them (see Steps 1 and 2). Often advertisers segment so much that they miss the opportunity to make the sale.
So remember the continuum, your positioning, and what goes into making a sale when you're engaging teens. Your secondary market, parents, will most likely be the ones to complete the sale and they will do so at an increase price point and rate if you engage them, too.
COMMENTARY: Like I have been saying before think "cool" when marketing to teens. With parents think family factors like benefits, quality, economical, safe, secure. Combine both the teen coolness factor and the parental family factors elements into your advertising message and content. If possible include teens in your ad content. Don't exclude them if they are the user, and the parents are the buyers.
Courtesy of an article dated September 30, 2010 appearing in
The chief operating officers for social media darlings Facebook Inc. and Twitter Inc. appeared Tuesday before roomfuls of marketers in New York with the following message: Seriously, folks, you should really start giving us your money.
Polished in business black and power heels, quite the contrast to Chief Executive Mark Zuckerberg’s tendency towards hooded sweatshirts and casual footwear, Facebook’s Sheryl Sandberg submitted that the social network enables brands to do word-word-of-mouth marketing at massive scale. She made the case that marketing’s ethos is about connecting with people and Facebook is doing exactly that, making it the ideal vehicle to reach consumers.
“Brands have always talked to people, but on Facebook you can talk and listen,” Sandberg said, speaking at the Interactive Advertising Bureau’s MIXX Conference, a gathering that draws marketers, ad agency executives and publishers to debate trends to shape the future of digital advertising. “This is the power of the social graph.”
She trotted out a roster of major brands – Chase, Nokia, Sephora and Toyota, for starters – that are rejoicing in the reach they can attain on Facebook. To illustrate the value of Facebook campaigns, she used Einstein Bros. Bagels’ decision earlier this year to offer free bagels to its Facebook fans, an initiative that helped the nationwide chain’s fan page skyrocket from 5,000 to more than 600,000, leading the company to its best week of sales for the year.
Sandberg’s message was clearly that advertising on Facebook is no longer experimental. To drive that point home, she mentioned Nielsen Co.’s announcement this week that it will measure audience data on Facebook, the way it measures television ratings.
Twitter’s Dick Costolo, speaking separately at the MIXX Conference, also had a confident message, noting that he sees Facebook as more of a partner in shifting ad dollars online than a competitor.
“We feel like we’ve cracked the code on a new type of advertising,” Costolo said.
Twitter currently has three ad products for its micro-publishing platform: Promoted Tweets, which raises the prominence of an individual post; Promoted Trends, which lets marketers place a promoted topic at the bottom of Twitter’s trending topics; and the soon-to-launch Promoted Accounts, which allows marketers to pay to be recommended to a relevant audience.
Industry watchers have devoted a fair amount of commentary toward how Twitter will monetize its massive network of about 200 million users. Costolo said the company still remains focused on building ad products that provide the best value to marketers and the community of users.
“We could accept millions of dollars from advertisers right now for short-term revenue, but we have no intention of doing that,” he said. “Monetization will fall out of engagement organically.”
While Twitter has mostly experimented with advertising with a small number of large brands, the company will debut next year a self-serve platform for anyone to buy advertising. He said the company’s EarlyBird experiment with daily deal tweets has been shelved to focus on other products.
“There’s a line out the door to advertise with us,” Costolo said.
COMMENTARY: Boy this all sounds like 'Promoted" propaganda for brand marketers to run advertising on Facebook and Twitter. "Okay, I got it now. Let's run some damn ads!"
Courtesy of an article dated September 28, 2010 appearing in The Wall Street Journal's Venture Capital Dispatch
With 500 million people using Facebook and Twitter seeing more than two billion tweets per month, one would assume that social media usage is skyrocketing. New research from Forrester suggests that while participation is on the rise, actual content creation may not be.
Forrester’s Social Technographics Profile analyzes consumer social behaviors and trends on an annual basis. Forrester classifies social network users by type: Creators, Conversationalists, Critics, Collectors, Joiners, Spectators and Inactives. In the past year, their research shows no measurable growth in the Creators category — the audience that creates social content.
In the U.S., the Creator audience has actually dipped a percentage point from 24% in 2009 to 23% in 2010. Japan was the only country measured to show a rise in Creators, growing from 34% to 36% in the past year.
When it comes to social media, it would seem then that the average user feels most at home taking more passive actions, and that a majority of content creation is primarily limited to the existing content creator crowd. As Forrester reports, “One-third of online consumers in the U.S. regularly watch user-generated videos on sites like YouTube(). But only 10% of U.S. online consumers upload videos they’ve created to public sites.”
Still, social networking is on the rise, according to Forrester. In the Joiners category (those that join social networks), most countries surveyed saw significant increases, including the U.S., which jumped from 51% to 59% between 2009 and 2010.
COMMENTARY: I wonder just how much duplication of "created" work there is. You find several uploads of the same video content on YouTube. The same thing is happening on Twitter, with individuals writing content on the same topic. Then there are those Retweets. That's a lot of duplications. So, I wonder if Forrester took that into account. The numbers could be a lot worst.
In closing, in the beginning God created the earth and the heavens, but there was no light so he created day. But, who created God.
Google Chief Executive Eric Schmidt, onstage at the TechCrunch Disrupt conference in San Francisco on Tuesday, plugged the moneymaking potential of Twitter.
"Twitter strikes me as being a very important platform," Schmidt said. "Twitter should be able to come up with advertising and monetization products that in our opinion are highly lucrative."
Twitter Chief Operating Officer Dick Costolo was in New York at the Interactive Advertising Bureau's Mixx Conference on Tuesday with a similar pitch.
That's where he unveiled a new initiative called Promoted Accounts. Advertisers can boost their audience on Twitter by paying Twitter to automatically suggest to users with similar interests that they "follow" the advertisers. Costolo said in an interview this month that Twitter was pleased with the performance of Promoted Tweets, which appear at the top of updates, and Promoted Trends, which are featured on a list of trending topics. Advertisers pay when users click on a link, which happens about 5% of the time.
The idea behind the latest initiative is to give businesses the opportunity to get their updates in front of users, not just their ads. Twitter plans to roll out a self-serve advertising system for small businesses next year.
Costolo also said Twitter was abandoning its @earlybird initiative, an account that Twitter users could follow to get daily deals from advertisers.
It was a big day for Twitter: It surpassed MySpace in unique visitors to become the third-most popular social networking service. According to its latest stats, Twitter has more than 160 million users and is adding 370,000 users a day.
Twitter had nearly 96 million unique visitors in August, up 76% from the same period a year ago, ComScore said. MySpace shed 17% in the same period, dropping to 95 million unique visitors last month.
Twitter and MySpace are tiny compared with Facebook, which jumped 54% to 598 million unique visitors in August, and Microsoft’s Windows Live profile, which combines the company’s Web-based e-mail and other services to grab 140 million unique visitors.
Twitter could gain more visitors with its redesign launched two weeks ago.
COMMENTARY: So I can expect to see a new section labeled Who to Follow with some links for brands Twitter thinks I should follow and that I share commonalities with. Sounds interesting.
I am curious about that algorithm that Twitter has developed that will identify brands that I should follow. Since I am into technology, SMM, venture capital, green technology, inventions and new products, and booty, this could actually help me connect with brands. I benefit because maybe I learn something from that brand, and the brand benefits because they have another set of eyeballs for their products or services, and potential customer. Ah yes, it all makes sense.
Never mind that I can search for followers or brands that might interest me on my own, and I have done this in the past, but Twitter thinks they ought to help us along, instead of waiting for us to act. So what is the payback ($$) for me if I take up Twitter's recommendation and follow a particular brand? Nothing comes free laddies. I want some doe, virtual currency or something of value that I can redeem. Fort of like points used in loyalty programs.
I think Twitter needs to make a compelling call to action, for example, "WIN a date with Kim Khardasian, click here to qualify for the grand prize." That might actually do it for me, all kidding aside.
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