ImaginativePRO Blog

INSIDE THE TEST FLIGHT OF FACEBOOK'S 'AQUILA', THE FIRST INTERNET DRONE

It's 2:00 am in the dark morning hours of June 28th, Mark Zuckerberg woke up and got on a plane. He was traveling to an aviation testing facility in Yuma, AZ, where a small Facebook team had been working on a secret project. Their mission: to design, build, and launch a high-altitude solar-powered plane, in the hopes that one day a fleet of the aircraft would deliver internet access around the world.

Zuckerberg arrived at the Yuma Proving Ground before dawn. Zuckerberg said in an interview with The Verge.

“A lot of the team was really nervous about me coming.”

A core group of roughly two dozen people work on the drone, named Aquila (uh-KEY-luh), in locations from Southern California to the United Kingdom. For months, they had been working in rotations in Yuma, a small desert city in southwestern Arizona known primarily for its brutal summer temperatures.

 

On this day, Aquila would have its first functional test flight: the goal consisted of taking off safely, stabilizing in the air, and flying for at least 30 minutes before landing. Zuckerberg says.

“I just felt this is such an important milestone for the company, and for connecting the world, that I have to be there.”

For Facebook, Aquila is more than a proof of concept. It’s a linchpin of the company’s plan to bring the internet to all 7 billion people on Earth, regardless of their income or where they live. Doing so will lift millions of people out of poverty, Zuckerberg says, improving education and health globally along the way. But it will also enable the next generation of Facebook’s services in artificial intelligence, virtual reality, and more. This next era of tech will require higher bandwidth and more reliable connections than we have today, and drones can help deliver both. The road to a VR version of Facebook begins where Aquila leaves the runway.

Click Image To Enlarge

As the Sun rose over the desert, a crane lifted Aquila onto the dolly structure that would propel it into the sky. The drone has a tremendous wingspan: 141 feet, compared to a Boeing 737’s 113 feet. And yet Facebook engineered Aquila to be as light as possible to permit ultra-long flights. Built with carbon fiber, the latest iteration of the drone weighs around 900 pounds — about half as much as a Smart car.

A remote control operator activated the dolly, and Aquila began rumbling down the runway. The plane is attached to the dolly with four straps. When it reached sufficient speed, pyrotechnic cable cutters known as “squibs” cut through the straps, and Aquila lifted into the air, where it floated up its test altitude of 2,150 feet and stabilized. On the ground, Facebook’s employees were elated; some wiped away tears.  Zuckerberg said.

“It was this incredibly emotional moment for everyone on the team who’s poured their lives into this for two years.” 

Watching from below, Zuckerberg was struck by Aquila’s deliberate, unhurried pace.  Zuckerberg said two weeks later, at Facebook’s headquarters in Menlo Park, CA.

“It flies really slowly.  Most times when people are designing planes, they’re designing them to get people or things from place to place, so there’s no real advantage to moving slowly. But if your goal is to stay in the air for a long period of time, then you want to use as little energy as possible — which means going as slowly as you physically can, while not falling out of the air.”

Click Image To Enlarge

FLIGHT MANUAL

Okay, but why a plane?  There are lots of ways to bring the internet to people that don’t involve designing your own drone.

There are satellites, which are good at delivering internet access to wide geographical areas. But they’re only effective in areas with low population density — too many users can gobble up the bandwidth in a hurry.

There are cellular towers, which excel at connecting dense urban populations. But building enough cellular towers to cover the entire Earth is considered too expensive and impractical, even for Facebook.

In 2014, Zuckerberg wrote a paper analyzing various methods of internet delivery. High-altitude drones, he said, could serve a huge audience of people who live in medium-sized cities or on the outskirts of urban areas. They fly closer to the ground than satellites, meaning their signals are stronger and more useful to larger populations. And they fly above regulated airspace, making them easier to deploy.

If Facebook could build a drone that gathered most of its power from the Sun, Zuckerberg reasoned, it could fly for 90 days. A laser communications system could deliver high-speed internet to base stations on the ground, connecting everyone within 50 kilometers. The planes would be easier to maneuver than, say, balloons — a method embraced by Google, which has embarked on its own global connectivity crusade with Project Loon. (Last year Google challenged Facebook more directly with Project Titan, a solar-powered internet delivery drone of its own.) If the drones could be built cheaply enough, they would one day dot the skies, and become a critical piece of the global internet infrastructure.

And so 26 months ago, Zuckerberg set an ambitious goal: to release a functional version of Aquila in just a couple years. He personally recruited experts from NASA’s Jet Propulsion Laboratory and MIT’s Media Lab, among other places, to bring his vision to life.

As part of the project, Facebook spent nearly $20 million to acquire the team behind Ascenta, an aviation consultancy led by Andy Cox. Cox is a mechanical engineer who previously worked on a team that kept a solar-powered drone in the sky for two weeks — still a world record. After Facebook acquired his consultancy, Cox became Zuckerberg’s top lieutenant on the Aquila project. The team works out of a warehouse in Bridgewater, 150 miles west of London.

As recounted in Wired earlier this year, building a working model of Aquila put the team in daily battle with the laws of physics. Early on, it attempted to launch Aquila with a hot-air balloon. A planned test flight date of October 2015 was pushed back, and then pushed back again. Attempts to fly a 27-foot scale model of Aquila were hampered by El Niño storms.

But by June 28th of this year, the team had overcome those hurdles. At cruise altitude, Aquila was using just 2,000 watts of energy — the equivalent output of five strong cyclists, Zuckerberg says. The company hoped Aquila would successfully remain aloft for half an hour. But it was so stable that they kept it in the air for 90 minutes before landing it safely.

Click Image To Enlarge

THE HARD PART

In it's first flight, Aquila exceeded engineers’ expectations for its energy efficiency. More test flights are planned, aimed at flying Aquila “faster, higher, and longer,” says Jay Parikh, Facebook’s vice president of engineering, in a blog post today. And then Aquila will have its next big test: flying with the “payload,” as Facebook calls the laser communication system that a team is building in Woodland Hills, CA. In July 2015, the team announced that its lasers could deliver data at tens of gigabits per second, about 10 times faster than the previous standard. And the lasers are quite precise, able to target an area the size of a dime from 10 miles away. (The lasers connect with base stations on the ground to supply internet access.) Facebook says the system has performed well in independent tests.

When will a fleet of Aquila drones bring data to the world? Facebook won’t say. There are several technical challenges remaining in getting Aquila to reliably fly 90-day stretches. The team hasn’t yet implemented solar panels on the prototype — the test flight plane ran using batteries only. The team is still working out how to build batteries with a density high enough to sustain lengthy missions. Then there’s the cost — Facebook says Aquila needs to be much cheaper if the world is going to deploy a fleet of them. Cox wrote in a blog post today.

 “We need to develop more efficient on-board power and communication systems; ensure the aircraft are resilient to structural damage to reduce maintenance costs and able to stay aloft for long periods of time to keep fleet numbers low; and minimize the amount of human supervision associated with their operation.”

Aquila is also likely to face regulatory obstacles, which could rival the laws of physics in terms of the challenges they present. Facebook and Google have teamed up to work with authorities, such as the Federal Aviation Administration, to get permission for test flights and obtain access to the spectrum they need to serve data.

Facebook says it doesn’t plan to use Aquila to build its own cellular network. Instead, Zuckerberg says, it wants to license the technology — or even give it away to telecommunications companies, governments, and nonprofits. In emergency situations, he says, Facebook could direct its fleet to troubled regions to bolster internet access for hospitals and nonprofit centers.

But it remains unclear how governments will receive Facebook’s latest idea for connecting the world. The company’s efforts at diplomacy have sometimes been clumsy; Indian regulators banned Free Basics, Facebook’s effort to provide some internet services for free, on the grounds that giving the company control over the included services violates net neutrality. Bringing more people onto the internet, after all, is a way of bringing more people onto Facebook — and regulators have worried that the company’s end goal is to simply replace the open web for most users, while reaping the rewards in advertising dollars.

Zuckerberg says the company has learned from its failure in India — one he hopes is temporary.  Solar-powered planes will raise additional regulatory issues, he says.

“We’ve learned a lot about how we need to interact with governments and the political system and regulators, and build support in order to have these things work. And I think we’ll take those lessons forward.  But when I meet world leaders, a lot folks are really excited about this, because you want your people to be online, and you want more opportunities. And connectivity is one of the biggest ways that people get access to opportunities.”

Click Image To Enlarge

The path forward for Aquila isn’t totally clear, and it’s bound to encounter more bumps along the way. But Zuckerberg is resolute: billions of people who can’t access the internet deserve it. And for Facebook to achieve his long-term vision, everyone is going to need access to more bandwidth than they have today. A single test flight represents a tiny step toward getting there. But it also gives Facebook a dramatic success to rally around.

Zuckerberg says.

“I think the future is going to be thousands of solar-powered planes on the outskirts of cities and places where people live, and that’s gonna make connectivity both available and cheaper.  And, I think, can help play an important role in closing this gap of getting more than a billion people online. This is an early milestone, but it’s a big one.”

Zuckerberg smiled and said.  

“It’s not something you necessarily expect Facebook to do — because we’re not an aerospace company. But I guess we’re becoming one.”

 

COMMENTARY:    Zuck's strategy to fly internet drones over poverty stricken geographical areas, like those in Africa, where the internet penetration is only 9.8%, or the cost of WIFI connectivity is prohibitably high, is really a ploy to get more Facebook users.   At its core, it sounds like a noble and philanthropic mission of helping those in need, but it is solely about getting more eyeballs to connect through Facebook and sell them things through online ads.   If Zuck really wanted to help needy African's he should take some of those billions he has and give it to charitable organizations which are fighting to eradicate hunger, AIDS, Ebola, malaria and other diseases.  

Courtesy of an article dated July 28, 2016 apparing in The Verge

CLICK HERE TO Visit My Blog and Subscribe To My Newsfeed

 

WHY MICROSOFT ACQUIRED PROFESSIONAL SOCIAL NETWORK LINKEDIN, AND WHY THE DEAL COULD WORK

Microsoft Chief Executive Satya Nadella (bald dude) together with CEO Jeff Weiner (bearded dude) and Chairman Reid Hoffman (the fat dude) has said LinkedIn will be allowed significant autonomy after the acquisition.  (Click Image To Enlarge)

Microsoft and LinkedIn are a natural fit, and the deal may fare better than Microsoft’s past acquisitions

The companies jointly announced the deal: Microsoft will pay $196 a share in cash for LinkedIn, which will retain its brand, culture and independence under the new structure. CEO Jeff Weiner will remain at the helm, reporting to Microsoft CEO Satya Nadella.

Both Weiner and Reid Hoffman -- LinkedIn chairman and controlling shareholder -- fully support the deal, and the both companies' boards have agreed to the acquisition. Microsoft will report LinkedIn as part of its Productivity and Business Process segment.

The companies share a mission to empower the global workforce, Nadella said in a Monday morning conference call.

He remarked.  

"When we talk about Microsoft's mission, we talk about empowering every person and every organization on the planet to achieve more.  There is no better way to really realize that mission than to connect the world's professionals to make them more productive and successful."

Professional Network

LinkedIn has grown its membership about 19 percent year-over-year to 433 million members worldwide. The network has 105 million unique members on the site per month, and 45 billion quarterly page views.

However, the company has seen its stock price falter in recent months in response to its warnings of shortfalls in projected revenue.

Mike Jude, a program manager at Stratecast/Frost & Sullivan, said.  

"By combining professional social media with their Web-based business offerings, they have the potential to develop an extremely powerful collaborative environment that crosses business lines." 

Microsoft can benefit by adding new business features to LinkedIn, but it could alienate LinkedIn members if it should push too hard to leverage their data for marketing and sales opportunities, he told the E-Commerce Times.

Many professionals use LinkedIn as their homepage -- similar to the way hardcore Facebook users begin and end their days, noted Jeff Kaplan, managing director of ThinkStrategies.

Salespeople often use LinkedIn as the default application for pursuing new business -- even more than they use CRM or other sales or marketing automation tools, he told the E-Commerce Times.

Kaplan said.

"Creating tighter linkages between LinkedIn's capabilities and Microsoft's Office 365 productivity/collaboration and its Dynamics CRM will [demonstrate] immediate benefits of the acquisition.  In addition, it will encourage more developers to build applications on Azure PaaS that leverage the LinkedIn and Microsoft functionality, and store the data in the Azure IaaS."

Despite the potential benefits of combining LinkedIn's social network with Microsoft's cloud infrastructure, it's questionable whether Microsoft can pull off a successful integration. The company has fallen short with some recent acquisitions.

Poor Track Record

Kevin Krewell, principal analyst at Tirias Research, told the E-Commerce Times.

"I'm usually skeptical of big deals like this.  The last huge acquisition by Microsoft was Nokia, and that didn't end well, with Microsoft eventually writing down most of the value of the deal."

However, Nadella may avoid some of the mistakes of previous executives, Krewell suggested, adding that there are synergies between the Office 365 cloud base and LinkedIn that can be exploited.

In addition, Linkedin has in-app messaging capabilities that could be integrated into Microsoft's Skype video, phone and messaging application, Tirias Principal Analyst Paul Teich told the E-Commerce Times. The deal also provides Microsoft with a network of business influencers to analyze with its deep learning tools.

Microsoft Corp.’s planned acquisition of LinkedIn Corp. potentially is a very savvy move, though you would be hard-pressed to discern that.

There are lots of reasons for skepticism. The price tag, for one. At $26.2 billion, it is by far Microsoft’s largest acquisition ever. The size alone is a reason for caution, given the sorry history of such large deals.

Then, there is Microsoft’s own checkered history with acquisitions. It has recorded write-downs exceeding the $9.4 billion it paid for the handset unit of Nokia Corp. in 2014. Earlier deals for Skype Technologies and Yammer Inc., designed to bolster Microsoft’s digital and social credentials, did little of either.

But this deal can succeed where the others failed.

Here’s why.

Real Synergy

There is real synergy between the companies and their products, particularly Microsoft’s Office productivity suite—now delivered primarily online—and LinkedIn’s core database of more than 400 million mostly professional profiles.

As Microsoft Chief Executive Satya Nadella told The Wall Street Journal,

“It’s really the coming together of the professional cloud and the professional network.”

In other words, we now work by toggling between our productivity software and our social networks. But why should the two be separate?

 

Microsoft CEO Satya Nadella and LinkedIn CEO Jeff Weiner discuss Microsoft's acquisition of LinkedIn. Learn more at: http://news.microsoft.com/?p=298414

Mr. Nadella is betting that were these two concepts reconceived today, they would be one.

LinkedIn Demographics Match Those of Microsoft

LinkedIn’s users are, arguably, Microsoft’s core demographic. They also offer Microsoft something it has long sought but never had—a network with which users identify. Microsoft needs to persuade LinkedIn users to adopt that identity, and use it across as many Microsoft products as possible.

Access to those users, as well as the enormous amounts of data they throw off, could yield insights and products within Microsoft that allow it to monetize its investment in LinkedIn in ways that the professional networking site might not be able to. Mr. Nadella already has mentioned a few of these, including going into a sales meeting armed with the bios of participants, and getting a feed of potential experts from LinkedIn whenever Office notices you’re working on a relevant task.

Microsoft's CRM Software Could Get Revenue Boost

LinkedIn also could supercharge Microsoft’s Customer Relationship Management (CRM) software, used to identify and track sales leads. Microsoft is in fourth place in market share among the large CRM players, including Salesforce.com Inc., SAP SE and Oracle Corp.

Enterprise Resource Planning (ERP) Software Market Shares Year 2015 (Click Image To Enlarge)

Top Six Enterprise Resource Planning (ERP) Software Vendors in Millinos Revenus For The Year Ending 2015 (Click Image To Enlarge)

Top 10 Enterprise Resource Planning Software Vendors by Revenues in Millions, Year 2015 vs 2014 (Click Image To Enlarge)

Salesforce is the market leader, but it holds a minority of the complex and sometimes ill-defined market.

LinkedIn already has its own CRM-type product, LinkedIn Sales Navigator, but more important, it has the data and reach that any CRM company would covet.

If CRM is ultimately about managing relationships, what better vehicle for that than an existing social network with its built-in insight about who is connected to whom?

LinkedIn shares fell by nearly half in a single day in February when the company issued a gloomy sales outlook. Michael Wade, professor of innovation and strategy at Switzerland-based business school IMD, says the company hasn’t lived up to its potential for a while.

Mr. Wade says LinkedIn hasn’t evolved quickly enough beyond its roots as a recruiting tool and job-search site. Most of its users aren’t looking for a job, and LinkedIn has so far done a poor job of getting them to come back to the site regularly to connect with and expand their professional networks. Only about one quarter of LinkedIn’s 400 million “cumulative” users return to the site every month.

That brings us to perhaps the biggest reason why the deal may succeed: Mr. Nadella. Put bluntly, Microsoft today is a very different company than the one that acquired Nokia, Skype or Yammer. Under Mr. Nadella’s predecessor, Steve Ballmer, Microsoft sought to drive users to its platforms, primarily Windows.

As a corollary, that meant that acquisitions were quickly integrated with other Microsoft products and development of new features slowed.

Mr. Nadella has shown a willingness to meet users where they are, even if that is devices running Apple Inc.’s iOS or Alphabet Inc.’s Android mobile operating systems. On Monday, Mr. Nadella said LinkedIn will be allowed significant autonomy, similar to Microsoft’s handling of Minecraft maker Mojang.

That would mean walking a fine line between autonomy and synergy.  The longer the rope that Mr. Nadella gives LinkedIn CEO Jeff Weiner, the less benefit there may be to Microsoft’s products.

But don’t bet against him. If Mr. Nadella can re-energize an organization as big and legacy-bound as Microsoft, who is to say he can’t do the same for 13-year-old LinkedIn.

COMMENTARY:    For Microsoft CEO Satya Nadella, the culture created inside the walls of any company isn't just important, "it's everything."

Nadella, who spoke with USA TODAY in anticipation of his keynote address Tuesday at Salesforce's annual Dreamforce customer event, says "ultimately what any company does when it is successful is merely a lagging indicator of its existing culture.  He says.

"At Microsoft, we're aspiring to have a living, learning culture with a growth mindset that allows us to learn from ourselves and our customers.  These are the key attributes of the new culture at Microsoft, and I feel great about how it seems to be resonating and how it's seen as empowering."

Microsoft has been in the throes of a small cultural revolution, one largely guided by longtime employee Nadella. Where Microsoft's ethos under predecessors such as Steve Ballmer and co-founder Bill Gates had autocratic and anti-Silicon Valley overtones, the company has made concerted efforts in the past few years to both promote internal dialog as well as forge external relationships.

Where Microsoft employees once received mandates from the C-suite, today they share ideas at company-wide hackathons. And where Microsoft once had combative relationships with rivals such as Apple, today the company has forged a variety of new partnerships with Salesforce, Box, as well as Apple. These moves are seen by many analysts as make-or-break plays to try and position Microsoft for growth in a competitive cloud- and mobile-first world.

Another big tech issue of the day is finding talent, due to a small pool of engineers being chased by a growing number of tech enterprises. In Silicon Valley, new hires are often wooed by six-figure salaries and promises of perks ranging from in-house chefs to flexible work schedules. Given such lavish overtures, a recent report in The New York Times that described a toxic work environment at Amazon caused a stir in social media circles.

Nadella doesn't hesitate when asked about the Amazon workplace debate, though he doesn't mention the cross-town company by name.  Nadella says.

"The notion of having work-life harmony in a highly competitive economy is a first-class topic.  I think the key is to make sure you're engaging in a dialog with your employees. There also needs to be flexibility in all the (workplace) policies that someone like me sets and propagates. You cannot have people burn out. It's bad for your company, and it's bad for society."

Whether LinkedIn's more casual, entrepreneurial, and innovative culture under CEO Jeff Weiner and Chairman Reid Hoffman will mesh with the corporate style of Microsoft under CEO Nadella will meh remains to be seen.  Some hints may be found in what Jeff Weiner said as a reason why he sold LinkedIn to Microsoft.

“The Microsoft that has evolved under Satya’s leadership is a more agile, innovative, open and purpose-driven company,” Weiner wrote. “It was the latter point that first had me thinking we could make this work, but it was his thoughts on how we’d do it that got me truly excited about the prospect.”

Inside LinkedIn's Numbers

On April 28, 2016, LinkedIn reported their financial results for first quarter 2016.

Jeff Weiner said.

"We are off to a good start in 2016 with strength in our core and emerging businesses, and we continue to invest heavily in innovation and in our core products, while at the same time driving focus and scale to enable growth and leverage across the business.

Total revenue increased 35% year-over-year to $861 million.

Talent Solutions revenue increased 41% year-over-year to $558 million.

• Hiring revenue contributed $502 million in revenue, up 27% year-over-year.
• Learning & Development contributed $55 million in revenue.

Marketing Solutions revenue increased 29% year-over-year to $154 million.

Premium Subscriptions revenue increased 22% year-over-year to $149 million.

Adjusted EBITDA was $222 million, or 26% of revenue.

GAAP net loss attributable to common stockholders was $46 million and non-GAAP net income was $99 million.

GAAP diluted EPS was $(0.35), compared to last year's performance of $(0.34). Non-GAAP diluted EPS was $0.74, compared to $0.57 last year.

I highly encourage you to review associated materials, including our GAAP and non-GAAP reconciliation. [1]

I will co-host a webcast/conference call with our CEO Jeff Weiner to discuss our financial results for the fourth quarter and full year 2015 and business outlook today at 2:00PM Pacific Time.

See slides below.

LinkedIn Q1 2016 Earnings Call from LinkedIn 

Courtesy of an article dated June 16, 2016 appearing in The Wall Street Journal and an article dated June 13, 2016 appearing in eCommerce Times and an article dated April 6, 2016 appearing in Apps Run The World and an article dated June 13, 2016 appearing in Time and an article dated September 15, 2015 appearing in USA Today

MARKETERS: SOCIAL MEDIA ESSENTIAL, BUT DIFFICULT, ONLY 46% FIND FB EFFECTIVE, AND 60% UNABLE TO MEASURE ROI

According to the 8th annual Social Media Marketing Industry Report from Social Media Examiner, summarized by Marketing Charts, 9 in 10 marketers say that social media is important to their business, with the most commonly cited benefits being increased exposure and traffic. Based on a survey of more than 5,000 marketers, the study offers insights into the directions social media marketing will take in the near future.

Click Image To Enlarge

Social media does present some difficulties for respondents. For example, respondents were more likely to agree (40%) than disagree (33%) that social media marketing has become more difficult in the past year. While two-thirds analyze their social media activities, just 41% agree that they’re able to measure the ROI of those activities, a figure that hasn’t improved in recent years. But, only 46% agree that their Facebook marketing is effective, with more than one-third unsure.

A quick summary of primary findings from the Social Media Examiner Industry Report, shows that:

• Video has become essential: A significant 60% of marketers use video in their marketing and 73% plan on increasing their use of video
• Live video is hot: A significant 50% of marketers plan on using live video services such as Facebook Live and Periscope, and 50% want to learn more about live video
• Facebook and YouTube hold the top spots for future plans:  At least 63% of marketers plan on increasing their use of these social networks
• Snapchat is on a growth trajectory:  Only 5% of marketers are using Snapchat, yet 16% plan on increasing their Snapchat activities and 28% of marketers want to learn more about Snapchat
• Facebook is the most important social network for marketers by a long shot!  When asked to select their most important platform, 55% of marketers chose Facebook, followed by LinkedIn at 18%. Plus, 67% of marketers plan on increasing their Facebook marketing activities
• Many marketers are unsure about their Facebook marketing:  A significant 40% of marketers don't know if Facebook traffic has declined in the last 12 months and 35% aren't sure if their Facebook marketing is effective
• Facebook ads dominate:  A surprising 86% of social marketers regularly use Facebook ads, while only 18% use Twitter ads
• Tactics and engagement are top areas marketers want to master:  At least 90% of marketers want to know the most effective social tactics and the best ways to engage their audience with social media

Social channel use and importance varies among B2C and B2B marketers. B2B marketers continue to favor LinkedIn to a greater degree than B2C marketers (86% and 58% using, respectively), with B2B marketers also much more likely to be using Slideshare (21% vs. 6%), says the report. B2C marketers are more apt to be using Facebook (96% vs. 88%), Instagram (51% vs. 33%), and Pinterest (45% vs. 34%).

Those differences show up in marketers’ most important platforms, also. About 2 in 3 B2C marketers name Facebook their most important platform, with Twitter trailing distantly in second (11% share). Among B2B marketers, 40% cite LinkedIn as their most important platform, narrowly ahead of Facebook (37%), with Twitter third.

Despite already being the platform with the broadest adoption among marketers, Facebook (67%) emerges as the one for which the largest share will increase their efforts, says the report. Likely a reflection of its status as the most important platform overall, with B2C marketers (70%) being more likely than their B2B counterparts (61%) to see increased Facebook efforts on the horizon.

Beyond Facebook, 63% of respondents plan to increase their use of YouTube, with Twitter (61%) and LinkedIn (61%) close behind in terms of planned increases. Meanwhile, B2B marketers are more likely to be upping their LinkedIn efforts than B2C marketers (76% and 52%, respectively).

Results for other platforms likewise reveal differences in B2C and B2B marketers’ plans:

• More than 6 in 10 B2C marketers look set to increase their Instagram activities, compared to fewer than half (48%) of B2B marketers
• Pinterest is also an avenue for increased efforts more for B2C (47%) than B2B (35%) marketers
• B2B marketers (33%) are more than twice as likely as B2C marketers (15%) to put more effort into SlideShare.

While only 5% of respondents say they’re currently using Snapchat, 16% expect to grow their activities, more than double the proportion in last year’s survey. Also, 28% want to learn more about Snapchat this year, up from 19% last year, evidence of some growth but marketers are not adopting the platform at quite the same rate as youth. When asked how they respond to new social networks, 51% said they are skeptical and wait and see what happens, says the report.

Currently, there is one and only one leader in paid social media: Facebook. In fact, almost 9 in 10 respondents said they regularly use Facebook ads. Only 39%, are using Google ads, then:

• Twitter ads (18%)
• LinkedIn ads (17%)
• Pinterest ads (15%)

Signs point to Facebook maintaining its dominance in social advertising, says the report. However, it is the only platform in which a majority of respondents expect to increase their paid social media use. By comparison, fewer than 4 in 10 plan to make more use of Google ads.

Click Image To Enlarge

Turning to social media content types, 74% of marketers identified visual content as their most commonly used, followed by blogging (68%) and videos (60%). Blogging and visual content were essentially tied in terms of the most important content types, though with differences by target audience. Those marketing to businesses name blogging their most important content type, while for B2C marketers visual content is the most important.

When it comes to the near future, though, video gains ground. Almost 3 in 4 plan to increase their use of video content in the near future, just ahead of the 71% planning the same for visual content and leading all content types.

Finally, says the report, while only about 1 in 7 marketers are currently using live video, 39% plan to soon increase their live video efforts, and only 49% say they have no plans to utilize live video.

Click Image To Enlarge

For additional information about the Social Media Marketing Industry Report, please visit here. 

Courtesy of an article dated June 16, 2016 appearing in MediaPost Publications Research Brief

 

TWITTER'S REPORTS Q1 2016 EARNINGS, BUT WEAK REVS, STAGNANT USER GROWTH, POOR AD TARGETING, MAKE THE STOCK VALUELESS

 

Twitter reported its Q1 earnings today, and they’re not great. On the back of 310 monthly active users, the company posted revenues of $595 million, with Q1 GAAP diluted earnings per share of ($0.12) and non-GAAP diluted EPS of $0.15. This is a big miss on revenues but a beat on EPS.

Click Image To Enlarge

On top of this, the company issued very weak guidance for Q2, and currently Twitter’s stock is trading more than 13% down in the immediate aftermath of the results coming out. We’ll update this as it moves.

Twitter (NYSE:TWTR) shares declined 16.2% between the close of trading on April 26 (the day it announced its Q1 2016 earnings the price was $17.71 per share) and April 27 ($14.86 price end of trading)  (Click Image To Enlarge)

Analysts’ expectations for non-GAAP EPS averaged out at $0.10, while the average estimate for revenues was $608 million. The company remains unprofitable with the net loss it reported this quarter coming in at negative $79.7 million. GAAP EPS was expected at negative $0.17. Twitter itself provided revenue guidance of $595 million to $610 million.

The company also issued new guidance on Q2 that spells bad news for the quarter ahead (or at least much lowered expectations). Twitter expects revenues between $590 million and $610 million, but this is a huge step down from $678 million, which is what analysts had estimated before today’s release. Ebitda is also taking a big hit: with Twitter estimating between $145 and $155 for Q2, while analysts had expected $173 million.

Twitter’s 310 million MAUs is not great user growth, although it is up a bit. But this graphic with nearly-identically sized bars, from Twitter itself, sort of says it all when it comes to the topic of stagnating growth.

Monthly Active Users (MAU's) Comparison Twitter vs Facebook, Instagram and Snapchat (Click Image To Enlarge)

As a recap, last quarter (Q4), Twitter disappointed on revenues of $710 million and adjusted EPS of $0.16 per share, with monthly active users 305 million, essentially flat on a year ago and notably a decline from the previous quarter. And a year ago, the company’s stock dropped 18% on poor revenue and user growth.

A year ago, monthly active users were 302 million, with 80 percent of them using Twitter on mobile.

The thing about Twitter is that it is growing in some of the key areas where it hopes to as a business, but just not enough, at least not right now. The company said that advertising revenues were up 37% over a year ago, representing sales of $530 million. But that number was down by quite some way on last quarter, when ads brought in $640 million in revenues.

Part of this is because Twitter is still not pulling in as many big ad dollars as they expected or hoped to. The company noted.  

“Year-over-year revenue growth from large brand advertisers was softer than expected,although brand advertising remains our largest overall contributor to revenue.”

The company in the last quarter has made some waves to try to extend out its position as a media engagement platform, such as its deal to stream NFL games earlier this month, tapping both into its ambition to do more in video as well as sports content. Its early move with Periscope, however, is now facing competition from the likes of Facebook with its new Live product, and potentially Google, which reportedly is also building a live video service.

The company said in its report.

“As we outlined last quarter, we’re focused on what Twitter does best: live. Twitter is live: live commentary, live connections, live conversations. Whether it’s breaking news, entertainment, sports, or everyday topics, hearing about and watching a live event unfold is the fastest way to understand the power of Twitter. Twitter has always been the place to see what’s happening now and our continued investment in live will strengthen this position. By doing so, we believe we can build the planet’s best daily connected audience. A connected audience is one that watches together, and can talk with one another in real time.”

Earlier in the quarter, there was a lot of commotion around the company’s move to play around with the algorithm that serves Tweets to surface them non-chronologically, although we’re hearing a lot less about this more recently both from Twitter and users.

Internationally, it’s made some moves to potentially monetise its audiences outside the U.S. a bit better. In the UK, Germany and Japan (and soon France), Twitter is now working with Yelp to power location services (similar to the deal it has with Foursquare in the U.S.), although a recently appointed a new head of China has been spotted with controversy.

COMMENTARY:   It's become increasingly apparent that Twitter (NYSE:TWTR) is in trouble. Its user base is stagnant, its management is leaving in droves and its financials, as compounded by the company's most recent release, continue to miss the mark. Twitter's current market capitalization is a little over $10.2 billion - 60% down on its 2013 IPO cap.  A number of analyses have addressed each of these points individually, but none have as yet put forward the real issue.  That is, Twitter is essentially valueless.  This conclusion may come as a shock, but it shouldn't be.  Twitter's HQ is on fire, and key members of its management team, have bailed out.  That is the most important evidence.  Why Twitter is valueless will be discussed in more detail shortly, but first, let's note some of the arguments put forward by proponents of the company and its long shareholder base.

1. Perhaps the foremost argument for Twitter's bright future is the vast swathes of user data it holds, and - perhaps more importantly - the real-time data its platform generates.  As we will discuss, these are two very different things, and their value (especially in the case of the former) is overrated.
2. Twitter's large user base is often used to justify its multibillion-dollar market capitalization. A base of more than 300 million monthly active users is nothing to be ashamed of, and while growth is modest, any company should be able to effectively monetize such a large base of users. Twitter is failing to do so - again we will get to why shortly.
3. Twitter's utility as a news broadcasting platform. As stated by CEO Jack Dorsey:  "Twitter is the most powerful communications tool of our time.  It shows everything the world is saying...10 to 15 minutes before anything else."

There are more arguments in support of Twitter, but these seem to be the primary reasons behind an investment in Twitter as things stand - aside from the fact that optimists might regard its current price (78% cheaper than its 2013 highs) as a discount entry.  We hope, however, that the debasing of the three mentioned support points will, by proxy, debase this latter fourth.

We can debunk the above three arguments why Twitter is a worthwhile investment below:

Data - We will look at the data Twitter holds on its users as individuals first, as this is far more relevant to its ability to generate revenues (as things stand).  This is the data Twitter uses to target its advertisements - its sales pitch to potential ad clients, if you will.  Fake profile data aside, it also knows how old we are, where we live and - in many cases - what we do for a living. Aggregate this data and any company worth its salt should be able to offer up a pretty targeted campaign for a client. Not Twitter, apparently. We know this through two primary pieces of information. The first, through a statement made by the company's head of U.S. ad sales back in February. In an interview with Digiday, Twitter's Matt Derella discussed the company's new strategy of serving advertisements to users that aren't logged into the platform. To quickly explain this, in previous incarnations, Twitter would only display advertisements to a user that was logged in. If a non registered, or non-logged in user, was browsing the Twitter feeds of other users, it would be an ad free experience.  

It's reasonable to assume that Twitter should be able to serve far more effective advertisements to users that are logged in than it can to users that aren't (read: anonymous browsers). Not so. Here's what Derella said:

"We can provide the same level of deliverable results that we can with logged-in users."

This means that the data Twitter holds on its users doesn't actually translate to any deliverable benefit to its advertisers. How this can be the case is anyone's guess. The most logical assumption, however, is that Twitter's advertising is equally ineffective for both logged in users and for anonymous browsers, and that the former simply aren't responding to the ads being served across the platform. The second piece of information relates to a shift of ad clients away from Twitter, and is something we'll address in the second part of this piece - the part that relates to Twitter's ability to monetize its userbase.

Let's move on now to the real time data. Back in October,  Twitter's said that the hashtag, and the text-based communication, made for far easier aggregation than, say, Instagram or Snapchat's images. At the time, Twitter had just closed deals with IBM and Bloomberg - deals that looked to mark a shift in focus toward the data side of the business that, for so long, analysts had been screaming at Twitter to take advantage of.  Fast forward to the present day, however, and neither of these supposedly pivotal deals look to have progressed into anything game changing and if latest management-investor communications are to be believed, the company has once again shifted towards trying to redesign its ad offerings (vertical video load, DoubleClick integration, etc.) rather than package and sell its data. The latest news in this arena is that Twitter is targeting Japan as a data customer. There are only 35 million MAUs in Japan (about half the US equivalent figure). If the company struggles to sell its data to US businesses to the extent that advertising still accounts for the vast majority of its revenues, chances are it won't do a whole lot better in Japan. Another example, in this author's opinion, of a Hail Mary from Twitter. To put it another way, another example of the company talking big, but when it comes down to it, not being able to deliver. 

Large User Base - let us now address the second argument in favor of a bullish twitter thesis - the company's user base and its monetization. 310 million MAUs, as mentioned, is a good number. When compared to Facebook (1.59 billion MAUs), it obviously falls considerably short, but to say that a company should be able to effectively monetize 310 million active individuals is not being too hard on Twitter. For some reason, however, it hasn't been able to. Most reading will already be aware that the company generated $595 million revenues during the first quarter of 2016.  Of this number, $530 million came from advertising. Although now we are hearing that the big-ticket advertisers are shifting away from Twitter and toward fresher alternatives such as Snapchat. This isn't a surprise. Twitter has far surpassed the point where it can be considered an experimental advertising platform for the big-name brands.

It's now at the point where advertising agencies and their clients have data on the efficacy of a Twitter campaign and are able to weigh this up against reallocating their dollars toward expanding campaigns on the other established platforms or initiating experimental campaigns on platforms that are at the stage Twitter was half a decade ago. In other words, Twitter has attempted to monetize its user base and to some extent has done so. But as advertisers shift from the platform, chances are we will look back and see the current circa $600 million - or around two dollars per monthly active user - as a peak.

Utility As Advertising Platform - Following on from Dorsey's quote above, and this time with reference not just to Twitter's fast paced, information breaking nature but also its shift into live streaming with Periscope, here's another quote (from the latest report):

"As we outlined last quarter, we're focused on what Twitter does best: live. Twitter is live: live commentary, live connections, live conversations. Whether it's breaking news, entertainment, sports, or everyday topics, hearing about and watching a live event unfold is the fastest way to understand the power of Twitter. Twitter has always been the place to see what's happening now and our continued investment in live will strengthen this position. By doing so, we believe we can build the planet's best daily connected audience. A connected audience is one that watches together, and can talk with one another in real time."

To offer up some credit, this statement is partially correct. Twitter's allure (for some) is that it offers a resource through which individuals looking for access to the latest breaking information can see what's happening.  Twitter offers users a list of "what's trending" on a geographgic basis.  There are a number of issues with this, however.  First and foremost, credibility. There have been numerous studies undertaken (here are three examples, but a quick search reveals plenty more) that totally debase the credibility of Twitter users' response to any crisis or breaking news event. Yes, factual information will generally publish through Twitter before mainstream media channels publish it, but there is a reason for the delay in the latter, and the reason is credibility. With some exceptions, reputable media channels fact check, cite sources and hold accountability for what they publish. The average Twitter user does not, and this unreliability undermines Twitter as a go to news source altogether. How can a user determine what is fact and what is fiction? Further, even if individuals did go to Twitter to glean the latest information before it breaks anywhere else, the chances of Twitter being able to serve them effective advertisements in the sort of environment that requires instant and first look access to a crisis or breaking news event are minimal.

It's important to note that this is not some sort of bias-driven rant intended to discredit Twitter as an investment opportunity. The platform has its uses. I also have an admittedly small, personal and professional following, with whom I'm able to share my blog posts via my Twitter account: @turk5555 Twitter broke the recent Prince passing and I happened to see it there first as I was (likely) performing one of the two already mentioned Twitter related activities.  Others no doubt, will have similar experiences with the platform. Some will use it far more.

When all is said and done, Twitter's advertising model has failed to generate an ROI for investors. Twitter has shown it is unable to deliver any (it has failed to generate a profit since it was founed in nearly 10 years ago) ROI, and any turnaround looks highly unlikely given current conditions.

As a mainstream information sharing platform, or as a forum through which individuals are able to keep tabs on the people that pique their interest, Twitter will probably be around for years to come. It's just not an investment opportunity, and it's not going to be long before even the most ardent Twitter bulls are forced to come to this realization and unload.

When Jack Dorsey returned to the helm as CEO in August 2015, he promised big changes would come, but with the exception of its Moments app, I have not seen any game-changing changes that would spark a turnaround in the number of monthly active users (MAUs) or advertising revenues.   Revenues are up year-to-year, but the increase in video ads has come at the expense of promoted tweets. Advertisers have merely shifted ad dollars from promoted tweets to video ads.    

The biggest problem that I see with Twitter is that it has become a "one trick pony" in the sense that people view it as a place to post your tweets and not much else.  In my opinin, Jack Dorsey must make a huge pivot to redesign Twitter into a social network with features that existing users will fall in love with to increase engagement and new user signups.  I have not seen evidence of either.  

Twitter's failure to provide advertisers, especially large brands, with ad targeting tools based on demographic and online behavior attributes, has created an endless parade of promoted tweets and video ads that are irrelevant to users.  I hope that the recent hiring of a full-time head of marketing, will correct this huge weakness and bring back big ad spenders.

Courtesy of an article dated April 26, 2016 appearing in TechCrunch, an article dated April 26, 2016 appearing in CNBC and an article dated April 26, 2016 appearing in SeekingAlpha

TRACKMAVEN B2B STUDY: INSTAGRAM HAS HIGHEST SOCIAL MEDIA B2B ENGAGEMENT RATES

While LinkedIn leads as a business-to-business platform in terms of penetration and scale, B2B social media engagement is actually highest on hip photo-sharing platform Instagram, according to a new study by TrackMaven, based on an analysis of 316 B2B brands across the major social networks.

Unsurprisingly, B2B brands have been busy on LinkedIn, building relatively large followings of vendors and customers; thus brands in the professional services category have a median LinkedIn audience of 1.2 million followers. They’re also active on Facebook, Twitter, and Pinterest, with varying rates of success: for example, the median number of Pinterest followers was less than 3,000 for most of the brand categories studied.

However Instagram – not necessarily most people’s first example of a B2B medium – stood out for delivering high engagement across a range of categories, with measurement defined by TrackMaven as the number of interactions per post per 1,000 followers.

Here are the B2B engagement rates for the major social media networks according to TrackMaven:

• Instagram yielded an engagement rate of 22.53.
• Pinterest at 15.88.
• Facebook at 5.99.
• LinkedIn at 1.09.
• Twitter at 0.86.

Instagram was the biggest source of social engagement for 15 out of 17 categories, including aerospace and defense, chemicals, computer hardware, construction, electrical equipment, energy, engineering, logistics, machinery, medical, motor vehicles and parts, pharma, professional services, software, and wholesales.

Just two categories did better elsewhere, with biotech seeing bigger engagement on Facebook, while financial services’ highest engagement came on Pinterest.

The rise of digital, including social media, has had a disruptive effect on B2B publishers similar to the impact on consumer media. According to figures from Connectiv (formerly ABM), from 2008 to 2014 B2B print ad revenues declined from 34% of the industry’s total revenues to 24.4%, while over the same period, digital advertising increased from 10.3% to 21% of the total business. Data and business information services rose from 5.8% to 10.2%, and events increased from 42.8% to 44.4%.

COMMENTARY:   TrackMaven's B2B brand social media study included a grand total of 508,060 social media posts and over 100 million social interactions. The 316 brands featured in their analysis include the leading B2B brands in the Global 500 and B2B leaders on social media as identified by the TrackMaven platform across 17 industries.

Which B2B industry has the best social media strategy?

Let’s start with a view of the complete B2B landscape on social media in one summary graph from the report. The graph below plots the average follower growth, average engagement ratio, and median social media audience size for B2B brands by industry across 2015.

Click Image To Enlarge

In a nutshell, you should aspire to land in the top right of this graph. Score high on the y-axis (follower growth) but low on the x-axis (content engagement), and your brand is growing but not engaging your audience. Score high on the x-axis but low on the y-axis, and your audience is interacting with your brand on social, but not bringing anyone new to the table.

So which B2B industries excel on social media? Here are just a few of the key takeaways:

• Biotech, engineering, and financial services brands are in the social media sweet spot. Brands in these industries have both substantial audience growth and high content engagement on social media, indicating impactful social content. The financial services industry’s 81.77 percent average follower growth per brand is especially impressive given the industry’s large median social following.
• Machinery manufacturers are adept at growing their audiences. Across the B2B landscape, brands in the machinery sector see the highest social media audience growth, with average annual follower growth across all five major networks of 129.02 percent. Engaging content is a correlated factor; social media content from machinery brands is ahead of the B2B pack, as indicated by its high engagement.
• Biotech brands know how to engage audiences. Across the B2B landscape, biotech brands have the most engaged social media audiences with an average engagement ratio of 12.46. Financial services brands are a distant second at 9.94
• Are software brands in a social media bubble? Software brands see fantastic social media growth — up 82 percent of total followers across 2015, on average — but the worst content engagement with a 2.62 engagement ratio. Is the allure of Silicon Valley attracting followers to top software brands without the content to back it up?

How to create a B2B social media strategy that works

Our analysis points to a major contradiction in B2B brand popularity. If you look at brand popularity based on follower count, then LinkedIn is the big B2B winner. Overall, B2B brands have the largest audiences on LinkedIn, according to our research. The median social media audience size for B2B brands is:

• 109,000 followers on LinkedIn;
• 34,000 page likes on Facebook;
• 18,000 followers on Twitter;
• 3,000 followers on Instagram;
• and 420 followers on Pinterest.

This finding probably comes as no surprise. After all, LinkedIn is B2B marketers’ social channel of choice. It’s used by 94% of B2B marketers, and the 10 most-liked brands on LinkedIn are all B2B brands. But is this a case of a self-fulfilling social media prophecy? I’m a B2B brand, therefore LinkedIn is my primary social channel?

Our research indicates that this might be the case — and it’s likely holding B2B brands back from newer, more impactful networks.

Let’s look at B2B brand popularity by a different parameter: content engagement. When we analyzed the average engagement ratio (number of interactions per post per 1,000 followers) for B2B brands on each social network, Instagram is by far the B2B powerhouse. The average engagement ratio for B2B brands is:

• 22.53 on Instagram;
• 15.88 on Pinterest;
• 5.99 on Facebook;
• 1.09 on LinkedIn;
• and 0.86 on Twitter.

We cover this finding (and many more) in detail in our report, but here’s the quick and dirty bottom line: Challenge the LinkedIn legacy effect for B2B brands. Explore newer, visual-oriented networks where there are high levels of engagement and less competition.

Courtesy of an article dated April 4, 2016 appearing in MediaPost Social Media Marketing Daily The Social Graf

INSTAGRAM CONTINUES DOUBLE DIGIT GROWTH, AND HOW TO FRAME YOUR BRAND ON INSTAGRAM

More than a third of mobile phone users will be on Instagram in 2016 

More than 90% of Instagram users are said to be under 35. Its user base, which is now more than 400 million worldwide, is larger than Twitter’s. EMarketer projects it will top 100 million people in the U.S. alone by 2018.

Austin-based nFusion recently published a marketer’s guide about how to get going on Instagram — but only if you’ve got a good reason to be there. We asked the agency’s managing director, Matt Huser, to elaborate on a few of its points and to name some names.

What makes Instagram different from good branding practices on other social media?

Matt Huser: The beauty and obvious aspect of Instagram is that it is visual -- which is the reason it's so compelling. By being visual, it weeds out a lot of the frivolous updates you get on Facebook and Twitter.

Also for that reason, Instagram lends itself to more lifestyle content, and people tend to follow the brands that reflect their lifestyles. So it’s the perfect platform for brands to increase their relevance and engagement with their audiences by aligning to their followers’ lifestyles, many times turning them into advocates.

The brands that utilize Instagram well post images that communicate their brand DNA and reveal some deeper truth or connection about the brand.

Instagram feeds that show behind-the-scenes images that their followers wouldn't normally be able to see through traditional media are most effective. Many fashion brands like Burberry and Rag and Bone do a good job of showing lifestyle images, not product images. Product may be included in the posted images, but it isn’t the focus.

Burberry focuses on images of London because London is such a foundational part of that brand, and a brand itself, which Burberry does well to align to. Rag and Bone shows people in action, mostly.

Because Instagram is visual, the marketers who participate are often more thoughtful. It forces marketers to have a strategy and to create content specifically for the channel. So it weeds out the brands that shouldn’t be on Instagram; there’s less noise than a Facebook or Twitter [post].

Is it as critical to be on Instagram as it is to be on Facebook and Twitter?

Huser: I don’t think it’s critical for every brand to have a presence on social media. In fact, as the social channels get more diluted with paid messaging, some brands may find it more advantageous to not be on a platform.

And companies should have discrete strategies for each platform.

For example, Twitter is a great customer-service platform. Facebook is a good platform to keep consumers informed, while Instagram is a good platform to play to people’s passions … to connect with a lifestyle. Brands should stay true to their DNA and not force themselves into a channel that isn’t aligned to a strategy. That said, Instagram is the fastest-growing platform, so you can’t ignore it.

Can you name a few marketers who are doing a particularly good job?

Huser: The ones that I like align to my lifestyle.

Publishers like Rolling Stone show amazing photography, accompanied by a caption of the behind-the-scenes stories from the actual shoot. As a music buff, I love those stories.

Patagonia does a great job of presenting beautiful photography of people doing crazy things in spectacular places.

But the brands that I’d like to work with, that are currently doing a pretty good job, include Intel, which presents visuals of the amazing innovations that their products fuel.

Altra, the running shoe company, does a great job of making me wish I was outdoors running with their photography.

There is a hotel in Austin called the Hotel St. Cecilia that does a great job of presenting aspirational lifestyle images of scenes at their hotel (it is humbling to realize that I am not very cool). I tend to follow the smaller, upstart brands who are still very true to the DNA of who they are.

Heineken did an interesting stunt in 2014 around the U.S. Open, but I’m not sure they consistently show up well.

Netflix is currently running a promotion for someone to travel the world and post on their behalf, which could be interesting.

What  Instagram blunders have you come across?

Huser: Not having a strategy. I don’t want to see images of your product. Work to align your brand with my lifestyle. A marketer’s content should have a purpose. Repurposed content on Instagram does not work. 

If you do [have a strategy] and have compelling content, it could be your strongest media channel. Every follower will be an advocate. 

COMMENTARY:  Instagram continues to prove its mastery of the mobile domain, according to eMarketer’s latest internet usage forecast. This year, 89.4 million Americans will log on to Instagram at least once a month, representing 34.1% of mobile phone users. And by 2017, 51.8% of social network users will use Instagram—surpassing the 50% mark for the first time.

Instagram’s user base is growing far faster than social network usage in general. Instagram will grow 15.1% this year, compared to just 3.1% growth for the social network sector as a whole. Over the next four years, it will add 26.9 million users, almost double the incremental users expected for Twitter and far more than any other social platform eMarketer tracks.

Instagram usage is particularly strong among millennials. This year, there will be 48.2 million millennial Instagram users in the US. By 2019, nearly two-thirds of all millennial smartphone users will use Instagram.

eMarketer principal analyst Debra Aho Williamson says.

“Instagram and its parent company, Facebook, know that mobile has changed the way people—especially millennials and Gen X-ers—communicate, share and get information.  That's why they are leading the way in helping marketers reach this audience.”

The robust growth in users is helping to drive an increasing share of Facebook’s mobile ad revenues. This year, 9.5% of Facebook”s worldwide mobile ad revenues (20.1% in the US) will come from Instagram. By next year, Instagram’s share will grow to 14.0% globally (28.0% in the US). 

Williamson says.  

“Instagram has a lot of momentum with advertisers, and its revenue is increasing rapidly. For marketers that want to target mobile millennials, Instagram is an attractive option.”

Courtesy of an article dated March 3, 2016 appearing in MediaPost Social Media Insider and an article dated February 22, 2016 appearing in eMarketer

 

7 THINGS WE HATE ABOUT TWITTER, BUT CORRECTING THEM IS NOT ENOUGH, TWITTER NEEDS GAME-CHANGING CHANGES

You probably either love Twitter for its quirkiness and brevity or see it as a pointless waste of time. After nearly a decade on the social scene, Twitter still needs to improve its user experience and fill in notable gaps in the service. These seven problems are long overdue for a fix.

7 Things Twitter needs to fix (right now)

Twitter mostly lets you do what you want, and while that freedom is a big part of what makes the platform special, it also contributes to an increasingly frustrating and lackluster experience. If you want to surface relevant tweets about a recent Supreme Court ruling within hours of a decision, you should have the proper tools to do so. Unfortunately, promoted tweets are just as likely to show up as the first result in a search as a tweet from an on-the-scene court reporter. The decade-old social network faces many different challenges, but these seven issues are particularly maddening because they're glaring issues that Twitter seems to simply ignore.

Conversation flow on Twitter a no-go

It's a chore to join and follow conversations on Twitter. The company's system for threaded conversations, based on chronological order and the people who contribute via @replies, is a convoluted mess. Unlike message boards and forums that delineate responses in chronological and hierarchical order based on single topics, Twitter conversations are a running feed. The bits and pieces of conversation included in Twitter feeds have too many variables, and the format makes it virtually impossible to follow responses in context. The conversations on Twitter simply have no flow, and the current system has got to go.

Click Image To Enlarge

Twitter needs to manage and share 'what's happening'

The concept of Twitter is based on one simple, all-encompassing question — "What's happening?" — but the company doesn't always do a good job sharing its users' answers. Instead of embracing and properly curating the breaking news and live events that play out on Twitter, the company leaves these tasks mostly to chance and circumstance. When humanity shows its face in surprising ways or terrible tragedy strikes, Twitter should do a better job of helping you follow along. A list of top 10 trends simply doesn't cut it anymore.

Click Image To Enlarge

Unfortunate lack of Follower management tools

Twitter doesn't do you any favors when it comes to managing your "Followers" or the accounts that follow them. The two lists, located on your profile page, show Twitter members in reverse-chronological order based on when they followed you or when they were followed, on a seemingly infinitely, scrollable page. There are no tools to manage your existing Followers, so people who want to bring order to their Twitter accounts are in for a rude awakening. It's simply inexcusable for Twitter to leave this problem unaddressed.

Click Image To Enlarge

Twitter Direct Messages and 'DM fails'

Twitter's "Direct Messages" (DMs) are a basic, yet powerful tool that lets you communicate privately, but the feature has been riddled with problems since its inception. "DM fails," as the Cool Kids say, have ended careers in rather spectacular fashion (Anthony Weiner). Twitter recently gave its users the capability to receive messages from any user (not only mutual followers), and the company says it will remove the 140-character limit on DMs in July. However, even the company's CFO and head of product have posted tweets intended for private viewing, and it's fair to say that nobody is safe from the occasional DM fail.

Click Image To Enlarge

Twitter ads should be more relevant — or at least interesting

All too often, the ads you see in your Twitter feed aren't even remotely relevant to your interests. Twitter's targeting capabilities don't match its competitors, and in addition, many of the ads it runs are downright boring. Promoted tweets, accounts and mobile apps frequently come off as safe, tried-and-true, and mundane. Twitter could be a canvas for marketing creativity, but instead it floods users with monotonous ads and often serves the same ads numerous times a day. Some of this is on the advertisers, but Twitter could provide a creative spark if it changed the format of its ads.

Click Image To Enlarge

Twitter's sorry search feature

Most Twitter users agree its search function is either broken or barely functional. Searching for news, topics, users and even hashtags on Twitter is a lackluster experience compared to other platforms. And its search results serve up too much noise and not enough valuable results. Twitter users are accustomed to the sorry state of search today, but that's not the way it should be, and it's on Twitter to fix the problem.

Click Image To Enlarge

Twitter's lackluster location experience

Twitter could deliver a more location-aware platform. It's not entirely Twitter's fault that many users choose not include location data with their tweets, but the company also hasn't made any sort of concerted effort to explain why users should tag tweets with locations. And unfortunately, even tweets that do get tagged with a location don't always appear where they should. For example, I recently searched for nearby photos of "sunsets" while in Southern California, and the top result was for Maui. If Twitter designed a captivating experience around location it could not only help users learn more about "what's happening" now, but what's happening nearby.

Click Image To Enlarge

COMMENTARY:   In August 2014, Twitter admitted in its IPO filing for the quarter ending June 30, 2014, that approximately 11 percent of its 271M active users — 29.8 million accounts — solely used third-party applications to access its service.

That's not necessarily a great thing for the company's bottom line -- that's 30 million accounts that aren't looking at or clicking on Twitter ads and 23 million that aren't necessarily actively interacting with their feeds.

It also reported that 23 million or 8.5 percent of monthly active users used third party applications that accessed Twitter without user-initiated action.   

Twitter also said that fake or spam accounts made up less than 5% of its monthly active users.

Here are some spellbinding Twitter stats:  

• 6,000 tweets every second, on average, are tweeted on Twitter (visualize them here)
• 350,000 tweets sent per minute 
• 500 million tweets per day
• 200 billion tweets per year.

The chart below shows the number of tweets per day throughout Twitter's history:

Click Image To Enlarge

According to researchers, the 29.8 million automated accounts generate up to 60% of total tweets. A scary stat if there ever was.  This would mean that out of the 200 billion tweets per year, approximately 120 billion tweets are being generated by third party software like Hootsuite, Hubspot, Tweetdeck, Twitterfeed, Bundlepost, etc. 

In a previous blog post, I expressed serious concerns about Twitter and and a lack of confidence in Jack Dorsey.  I just don't think that he has the chops to lead two troubled companies simultaneously. I have not seen any "bold" moves.  By "bold" moves, I mean game-changing and unique products or changes to Twitter that will create headlines and attract new users and increase engagement.  This is important for users as well as advertisers who are starting to get anxious and losing confidence in Twitter as a go-to ad platform.  If these bold moves are in the works, Jack better get them out in 2016, otherwise his next earnings conference call is going to be very, very tense.  

Having dropped these nuclear bomb criticisms, I believe that Twitter needs to be re-invented and radically changed.  Tweets alone, whether 140-characters or longer, are not going to change user perceptions of Twitter.   Bottomline:  Twitter cannot rely solely on being a news and information broadcasting platform.  Twitter needs to be much more than this.  It really needs to offer something entirely new, exciting, game changing and fill a real need in the marketplace.  Twitter may have filled users expectations for news and information in real-time (near), but other social networks are filling this need as well, they just don't call them tweets. 

Courtesy of an article dated July 1, 2015 appearing in CIO, an article dated August 13, 2014 appearing in ZDNet , an article dated August 12, 2014 appearing in CNN Money, an article dated April 20, 2015 appearing in Brandon Gaille and the Twitter Usage Stats reported as of January 4, 20156 by Internet Live Stats 

Follow Me:   Twitter: turk5555    Facebook: 797743955    LinkedIn: turk5555 

Subscribe To My Blog Newfeed

 

THE 43 BEST PPC MANAGEMENT TOOLS AS VOTED FOR BY EXPERTS AND THE PPC METRICS YOU SHOULD MEASURE

Paid advertisements are a great way to drive targeted traffic and relevant people to a website.

However, if you’re new to the Paid-Per-Click PPC game or have not optimised your campaigns to their full potential you could be throwing money away!

There’s a whole bunch of management tools out there that can help with optimising your PPC campaigns but how do you know which ones are the best?

In this article, Studio-40 asked 21 PPC experts for the tools that they could not live without.

Their answers include a wide range of free, paid and free trial option tools. Take a look…

Studio 40’s 43 Best PPC Management Tools As Voted For By Experts from Tommy Toy

 

COMMENTARY:   

Using PPC Metrics to help measure the success of your PPC Marketing?

The second question out of the 8 questions to ask before you hire a PPC expert is how will you measure success? When I wrote about setting pay per click goals, I said setting goals before you start is critical. Just as critical is understanding how you are going to measure whether you reached your goals or not.

Since goals are specific, you should be able to figure out what metrics you need in order to measure progress. For example, if your goal is to spend $1000 and get 10 conversions, you need to measure your total cost and total conversions. If you goal is to get 1000 visitors, then you will be measuring clicks. If you want to be shown on the first page of Google for specific keywords, then you measure average position and impression share for each of those keywords or ad groups.

These are some simple ideas but don’t let them fool you. As you begin to dig deeper into managing PPC campaigns you will want to start measuring other metrics or segmenting data into device types or time of day in order to understand how well your campaigns perform. For the sake of keeping this post from becoming a book, I am going to stick with the high level metrics and refrain from others such as bounce rates and the various types of conversions.

What PPC metrics are available?

Google and Bing provide plenty for you to analyze. To get you started, there are a handful of metrics that you need to know. Below are some basic definitions to help you understand them. Google details more of these and other definitions in their Adwords Glossary.

1. Impressions – The number of times your ad was displayed in a search results page.
2. Clicks – The number of times someone clicked on your ads.
3. Click Through Rate (CTR) – The percentage of clicks divided by Impressions.
4. Cost – The total cost for all clicks.
5. Average Cost per Click (CPC) – Total cost divided by the total number of clicks.
6. Average Position – How high in the results page is your ad showing. 1 is the highest.
7. Impression Share – The percentage of the total number of times your ad could have been shown vs the actual number of times it was shown.
8. Conversions – The number of times someone clicked on an ad and completed an action you defined as a conversion within a specific period of time.
9. Quality Score – Relevancy of your combined keyword, ad and landing page which affects your CPC. Quality scores vary but the higher the better.
10. % Served – When analyzing your ad copy, how often an ad was served vs other ads in the same ad group.

What should you measure?

Although every metric is important when evaluating PPC marketing performance, your goals will determine which metrics you should focus on first. As a general rule, I don’t recommend any of the following goals by themselves but together they will help you understand the basics.

I want to be seen on the first page of Google!

Being seen in the search engines is easy as long as you know what you need to spend per click and you are willing to spend it. Decide which keywords matter to you and bid them high enough to be competitive. Monitor the number of impressions as well as your impression share. You want your impression share to be at 98% or better. To be consistently seen, you should try to maintain an average position of 5 or higher. If your impression share is low, you need to increase your bids or increase your daily budget. If you are using up your daily budget, you might also consider limiting when your ads are running to weekdays, weekends or working hours only.

I want to be at the top of Google!

If you want to be at the top of the first page on Google you must be willing to spend more per click than everyone competing in your market space. Select keywords that you know people use when looking for the service or product you sell. Bid high and be sure you have the budget to afford being in the top spot. First position ads get more clicks and can eat up your daily budget really fast.  Once your campaign starts, monitor your average CPC, average position and impression share. If your average position is not 1 or 1.x, you should bid higher. There are other things you can do to improve performance, but by simply bidding higher than your competitors you can be assured that your ad will appear in the top position as long as you have not exhausted your daily budget.

I want to sell more widgets or get more leads!

If you are selling widgets or looking for leads you will want to setup conversion tracking. You can do this in Google Adwords and Microsoft adCenter but recent changes make tracking conversion (goals) easier in Google Analytics. In order to know whether your PPC campaign is doing its job, conversions should be your number one metric with everything else secondary. Most companies track form completions or e-commerce purchases but you can also track phone call conversions. Phone call tracking is especially important for companies focused on leads rather than sales. With custom scripts loaded on your website, you can present unique phone numbers to visitors who clicked on your PPC ads. For as little as $100 a month, you can track how many phone-based conversions come from your ad campaigns as well as organic SEO and other online channels. It’s another dimension that helps you understand how your online marketing affects your real world sales.

Variety is the spice of life

Every marketer has their own goals and their own ways of managing PPC campaigns. And everyone has their own ways of measuring success. As you begin to learn the ins and outs of PPC marketing, you will learn how campaigns work and what metrics are important to your success. Remember that PPC marketing combines art and science to deliver results. It’s not perfect but it can deliver great results as long as you keep working at it and keep an eye on the metrics. Understand the metrics and you will know whether your campaign is working or not. Understand the metrics and you will know if your goals are being met.

Courtesy of an article dated December 17, 2015 appearing in Studio-40 and an article dated June 26, 2013 appearing in FindAndConvert

Follow Me:   Twitter: turk5555    Facebook: 797743955    LinkedIn: turk5555 

Subscribe To My Blog Newfeed

FOR CEO JACK DORSEY LEADING TWITTER AND SQUARE AT THE SAME TIME MEANS NO OFFICE OR DESK AND 18-HOUR DAYS

Being CEO at two publicly traded companies means 18-hour days, a meticulous schedule and impromptu business meetings

Twitter Inc.’s executive chairman, Omid Kordestani, struggled to find time in Jack Dorsey’s jam-packed schedule for their weekly chat. So he offered to be the CEO’s driver for the day.

On a recent morning, Mr. Kordestani weaved through Silicon Valley traffic in his Tesla Model S as the pair talked business.

Mr. Kordestani said.  

“We just maximize every hour we can, however we can do it.”

It is a telling snapshot of the demands that now confront Mr. Dorsey, who recently embarked on the herculean task of running both Twitter and payments firm Square Inc.  His official return as Twitter chief in October, and Square’s IPO one month ago, put Mr. Dorsey in the rare class of CEOs charged with simultaneously leading two publicly traded companies.

The dual role invoked comparisons to tech luminaries Steve Jobs, who ran Apple Inc. and Pixar Animation Studios while they were both publicly traded, and Elon Musk, the CEO of Tesla Motors Inc. and privately held rocket maker Space Exploration Technologies Inc.

Mr. Musk, for one, isn’t an advocate.  Mr. Muisk said at a conference in October.  

“I wouldn’t recommend running two companies.  It really decreases your freedom a lot.”

He has said he would eventually step back from everyday operations at Tesla. Mr. Musk had no further comment.

Mr. Dorsey, 39 years old, isn’t married and doesn’t have any children unlike Messrs. Jobs and Musk. He will likely have little free time as both Twitter and Square are at critical junctures.  Twitter is working to show frustrated investors the social media service has mass-market appeal.  Square is trying to prove it can expand beyond the intensely competitive payments space.  Neither is profitable.

Twitter shares are trading at an all-time low and have fallen about 13% since Mr. Dorsey was named CEO. Square’s shares have risen about 35% since the IPO on Nov. 19, but they still trade below the price private investors paid last year.

Twitter and Square declined to make Mr. Dorsey or his executive teams available for comment.

Mr. Dorsey has looked to Walt Disney Co. Chief Executive Robert Iger as something of a mentor because of the multifaceted businesses he oversees, ranging from a movie studio and television networks to theme parks and cruise lines. Mr. Dorsey joined Disney’s board in 2013.

Mr. Iger said he occasionally counsels Mr. Dorsey on business matters. Mr. Iger said.  

“I am not involved in his businesses, so I am a good sounding board for him.” 

Mr. Iger said in an interview.

"To run two companies at once, you need a few things and Jack has them.  You need the ability to focus and prioritize and compartmentalize...and you need great people under you.”

Mr. Dorsey has cited strong leadership under him to help him manage the day-to-day, though he hasn’t assigned a No. 2 at either company.  At Twitter, he has eight direct reports—including operating chief Adam Bain and finance chief Anthony Noto—and 10 at Square, including one C-suite executive, CFO Sarah Friar.

Eric Flamholtz, professor emeritus of the University of California, Los Angeles Anderson School of Management, said.

“A classic CEO should have his hands in everything:  financials, operations, personnel.  But if you’re splitting your time between the two companies, it becomes much more about who the people are around you.”

Others have a different view.  Suhail Rizvi, whose firm Rizvi Traverse Management LLC is an investor in Twitter and Square, through a spokesman, said.  

“Managing multiple companies is the wrong way to look at the challenge.  The key is, can [Twitter] continue to develop new products and attract the best talent?  These are the areas in which Jack excels.”

For now, Mr. Dorsey appears to be sticking to a meticulous schedule with long hours.  Representatives of Twitter and Square say Mr. Dorsey works as much as 18 hours per weekday, spending his mornings at Twitter and afternoons at Square, which are located a block from each other in San Francisco’s mid-Market neighborhood.

Mr. Dorsey is disciplined about his schedule and habits. For example, current and former Twitter employees say he is known to abruptly get up at the designated end time of a meeting, simply saying,

“I’ve got to go.”

He typically starts his days with coffee at Blue Bottle, located between the two headquarters. According to Twitter and Square, on Monday morning, Mr. Dorsey arrives at Twitter for five-hour meetings with his eight senior executives and Mr. Kordestani to review the business operations and projects.  At 1:30 p.m., he rushes over to Square to repeat the same exercise.   Mr. Dorsey tells executives to put their phones and laptops away—he has no office or desk at either company.

He also holds 30-minute check-ins with key deputies at each company on Wednesdays and Fridays. He remains in contact even when he isn’t physically present, Mr. Kordestani said.

During Square’s IPO roadshow, he would call Twitter from his hotel room in between meetings or at night after his schedule wound down, Mr. Kordestani said.

His placid temperament and preference for meditation and yoga contrast with the gregarious and ebullient nature of Dick Costolo, who was Twitter CEO for five years before resigning in June.  Mr. Kordestani said.  

“When he comes into the room you get this sense of comfort that you’re with a very grounded person.” 

Still, Mr. Dorsey is said to get bogged down in minutiae. Two people who worked closely with him say he would at times drop everything to focus on, say, an app logo’s hue, or the wording of sections of a Web page.

While employees say he has lifted morale at Twitter, managers continue to depart.  In recent weeks, Twitter’s head of design, director of corporate strategy and a senior engineering executive have left or announced plans to leave.

A Twitter spokesman said that each of those people left for different reasons.

Over the past several months, Mr. Dorsey has reviewed the entire organization, asked for feedback about the company’s priorities and the reporting structure including those on the senior management team, according to people familiar with the matter.

When asked what he thinks of Mr. Dorsey’s performance so far, Mr. Rizvi, the investor, said:

“The results will be apparent over the next few quarters.”

Write to Yoree Koh at [email protected] and Greg Bensinger at [email protected]

COMMENTARY:  Just when Twitter (NYSE:TWTR) stock looked like it couldn't go any lower, it did. Then it did again. Twitter shares began a steep descent from around $53 in April to about $35 by mid-ear as investor concerns about the company's slowing user growth mounted.  At the end of today's trading, Twitter shares closed at $22.14, down $0.85 or -3.70%, a new low for Twitter.

Investors were hoping the company's decision this summer to bring back co-founder Jack Dorsey as CEO would quickly spark big, game-changing strategic moves. But, so far, the Street appears unimpressed.

Dorsey's believers

Chief Investment Officer Rizvi Traverse, whose investment firm has a stake in both Twitter and Square, is among the investors betting Dorsey is the right fit for Twitter as the company aims to address the social platform's slowing user growth problem.

But Rizvi says investors will have to wait longer to see the fruit of Dorsey's return.

An excerpt from a Dec. 21 Wall Street Journal article captures Rizvi's confidence: When asked what he thinks of Mr. Dorsey's performance so far, Mr. Rizvi, the investor, said:

'The results will be apparent over the next few quarters.'"

Similarly, in an October interview with CNBC, Twitter co-founder Evan Williams expressed confidence in Dorsey's plans to make "bold" moves. Williams believes these big changes will be evident in "months."

So far, the pace of change at Twitter from an outsider's perspective remains similar to the unsatisfactory pace under former CEO Dick Costolo's reign.  And this is driving uncertainty in the stock market toward the stock, playing a key role in the continued sell-off.

Embracing change

Twitter product lead Kevin Weil said during a Code/Mobile interview in October that Dorsey is encouraging Twitter managers to challenge their own assumptions. Weil even went as far as to say that the company is willing to change "something that's at the core of Twitter," prompting speculation that Twitter could even drop its 140-character limit for tweets.

One recent move that was supposed to represent a catalyst for the company was Twitter's October-launched Moments, a.k.a. "project lighting." But the new Twitter feature, which aims to rapidly curate news, doesn't appear to sport the gusto needed to transform the service into the mass-market player investors are hoping for.

While investors should, indeed, expect to see successful new features from Twitter following Dorsey's return, Rizvi is probably right that it's going to take "the next few quarters" for the co-founder's impact to be realized. Even Twitter's Moments feature isn't entirely representative of Dorsey's return to the company; the product was already deep into development when Costolo resigned.

Twitter Apps Waning

Twitter's company-owned apps have lost their appeal with users.  Vine, an app that creates 6-second videos, had 100 milli0n monthly active users at the end of September 2015, but has been overtaken and left in the dust by Facebook's Instagram with 400 million monthly active users.  Persiscope, a mobile app acquired by Twitter earlier this year, that lets you broadcast live video to your followers, has hit a brick wall with new users.  According to RE/CODE, Periscope only has 10 million monthly active users.  

A stock for greedy investors

The world's biggest tech company forgot to show you something, but a few Wall Street analysts and the Fool didn't miss a beat:  There's a small company that's powering their brand-new gadgets and the coming revolution in technology. And we think its stock price has nearly unlimited room to run for early-in-the-know investors!

A secret billion-dollar stock opportunity

The world's biggest tech company forgot to show you something, but a few Wall Street analysts and the Fool didn't miss a beat: There's a small company that's powering their brand-new gadgets and the coming revolution in technology. And we think its stock price has nearly unlimited room to run for early-in-the-know investors!

Closing Comments

In a previous blog post, I expressed serious concerns about Twitter and and a lack of confidence in Jack Dorsey.  I just don't think that he has the chops to lead two troubled companies simultaneously. I have not seen any "bold" moves.  By "bold" moves, I mean historic, breakthrough or disruptive new products or changes to Twitter that will create headlines and attract new users and increase engagement.  This is important for users as well as advertisers who are starting to get anxious and losing confidence in Twitter as a go-to ad platform.  If these bold moves are in the works, Jack better get them out before year-end, otherwise his next earnings conference call is going to be very, very tense.  

Having dropped these nuclear bomb criticisms, I believe that Twitter needs to be re-invented and radically changed.  Tweets alone, whether 140-characters or longer, are not going to change user perceptions of Twitter.  Twitter cannot rely solely on being a news and information broadcasting platform.  Twitter needs to be much more than this.  It really needs to offer something entirely new, exciting, game changing and fill a real need in the marketplace.  Twitter may have filled users expectations for news and information in real-time (near), but other social networks are filling this need as well, they just don't call them tweets. 

Courtesy of an article dated December 21, 2015 appearing in The Wall Street Journal and an article dated September 22, 2015 appearing in LinkedIn Pulse

Follow Me:   Twitter: turk5555    Facebook: 797743955    LinkedIn: turk5555 

Subscribe To My Blog Newfeed

TWITTER VIEWS VINE AS AN ENTERTAINMENT PLATFORM, NOT AD PLATFORM, WHICH IS WHY BRAND ADS NOT APPEARING IN VINE

Two years ago, Twitter-owned Vine was growing like kudzu. It was widely embraced by both consumers and marketers who sought to push the envelope with creative six-second clips. But the explosion of new video formats on Facebook, Snapchat and YouTube, which all now boast sizable scale, has caused top brands to quietly slip away.  Tyler Hissey, senior digital strategist at Hill Holliday, explained.  

"Over time, it became difficult for many marketers to achieve scale [on Vine].  In the last six months or so, brands have started to de-emphasize Vine as a channel because of the targeting capabilities on all these other platforms."

Data is proving this out. Video analytics firm Tubular Labs reviewed Vine, Instagram, Facebook and YouTube accounts of 40 major brands, including Coca-Cola, Target and Dunkin' Donuts. Between September and November, marketers posted 2,500 social videos, and Vine contributed just 113 of those clips—equivalent to 4 percent of branded content.

Click Image To Enlarge

Only 13 of the 40 brands posted to Vine during the third quarter of 2015, down from 21 in the first quarter of this year, Tubular found.

General Electric—renowned in marketing circles as an early adopter of new platforms—hasn't posted to Vine since last January, while social-savvy Mountain Dew's account doesn't appear to have been touched since April.

Tubular Labs co-founder Allison Stern said.

"I assume that brands are having this platform fatigue.  Marketers today are savvy about experimenting on a platform, but if it's not working for them, they're going to drop it."

One of the main reasons brands are turning away from Vine is because unlike its competitors, Vine doesn't have an advertising model, although brands often buy Twitter ads to promote their clips, noted Topher Burns, group director of distribution at Deep Focus.

 

Burns said.

"In terms of a distribution channel, Vine fails in comparison to what we'd expect from the other three [platforms]."

All that said, Vine still shines when social stars are involved. Instead of brands posting their own content, Burns said that clients are looking to team up with top influencers who have amassed massive followings to create sponsored content.

For example, when Dunkin' Donuts recently sought to promote its mobile app, it tapped social media star Logan Paul to create funny sponsored Vine and Instagram posts around its stores. The coffee seller used Twitter to push Paul's goofy clip, which shows him throwing a box of donuts in the air and has accumulated more than 3 million loops—Vine's view metric—in the past month.

Melanie Cohn, social media marketing manager at Dunkin' Donuts said.

"We find that Vine videos fulfill our fans' need for pure entertainment that they can't really find anywhere else." 

Tom Buontempo, president of Attention, agreed that influencers boost branded content on Vine, but noted that his shop is getting more Snapchat work as social media stars look to build audiences across multiple platforms.

He said.  

"Like a media property, they're looking to expand their footprint as much as they can.  We're doing more Snapchat campaigns through influencers than we are for any other platform right now."

Still other agency execs contend that Vine's problems stem from Twitter's sales pitch. Twitter is beefing up its advertising offerings for brands with new native video formats, livestreaming app Periscope and Niche—a platform that connects brands with creators—but Vine is often treated as an afterthought.

Mark Book, vp, director of Digitas Studios said.

"It seems to be a bit on the back burner as of late.  It is incredibly challenging to weave a brand or product narrative into a piece of content in six seconds. We have seen success with stop-motion and live events that tell a larger, real-time story, but those opportunities are few and far between."

COMMENTARY:  I think that this survey was too small to draw any conclusions concerning Vine's adoption by major brands, but there are other important reasons why brands aren't using Vine or Periscope as advertising platforms.  Twitter does not view Vine as a competitor to Facebook which has been highly successful with its video ads.  Vine has its eyes set on becoming less of a social network and more of an entertainment platform.  Speaking with Re/Code, Vine’s product manager, Jason Toff said,

“When Vine started it was a social network. But what we’ve found…is that the way people are most successful using Vine is as an entertainment network. So if you look at the product releases we’ve focused on, you’ll notice that there’s a trend toward this entertainment aspect.”

According to AdAge, Twitter's plan to make money from Vine and Periscope looks a lot different from the strategy it's pursuing with its core product.

Neither video platform will feature traditional, force-fed advertising, at least in the near term, according to Joel Lunenfeld, Twitter's VP-global brand strategy. Instead, Twitter is working with brands to promote content from these platforms within its core product, and serving as a middleman between brands and stars with major social followings.

Mr. Lunenfeld said at the Collision tech conference in Las Vegas in May 2015.  

"As of right now we don't have plans for promoted Vines or promoted Periscopes." 

For now, that means Twitter will likely lean heavily on Niche, a company that connects brands with social media all-stars.  Twitter acquired Niche in February for a reported $30 million. Niche, Mr. Lunenfeld said, has relationships with 10,000 social media "creators" and is especially well connected on Vine.

Twitter makes money from Vine, a personality-driven platform, by connecting brands with talent. Those stars, who command massive followings, then create branded content on the platform. Brittany Furlan, one such star, is followed by 9.1 million people, for instance.  Nash Grier, another star, is followed by 11.6 million people.

Mr. Lunenfeld said.

"A brand or an ad agency comes to us and says, 'I'm launching a new product; it's targeted to this audience.' We'll say, 'Okay, here's 15 people [and] five of them, alone, have a combined audience bigger than BuzzFeed.'"

HP, in one case, used Niche to find talent to create ten Vines promoting the launch of a convertible laptop. The Vines were so engaging, Mr. Lunenfeld said, that the company turned them into a 30-second TV ad.  He said.  

"We knew there was something special there, and the backend metrics showed that purchase intent, brand awareness, all those things went up."

 

Twitter must be careful with its approach to advertising on Vine.  The community on the platform is tight-knit and not likely to respond positively to ads forced into their streams. Instagram, another visual platform, faced a backlash when it introduced ads.

Mr. Lunenfield said.  

"We're really focusing on building the product, the experience and the community first.  Then we've got strong relationships with every advertiser to learn how to promote that through Twitter proper."  

In conclusion, Twitter has no plans to convert Vine and Periscope into advertising platforms.  Brands use the Twitter platform for engaging with its fans, and this is where promoted ads and videos will be placed.  

Having said this, it is important to distinguish between Twitter's Vine app adoption by brands and individual Twitter users.  By the third quarter 2013, Vine was the fastest growing mobile app in the world with 23.65 million users and grew at 403% during 2013.  Instagram had 109.7 million users, but only grow 130% during 2013.

Click Image To Enlarge

Twitter does not publish Vine statistics, but I found that The Social Media Hat compiled the following Vine statistics taken from different sources.

• 200 Million - Number of Vine monthly active users (8/27/15)
• 31.7% - Monthly growth rate of Vine monthly active users (12/7/15)
• 14% - Vine's reach of total U.S. digital population (4/2/15)
• 100 Million - Number of people that watch Vine videos each month (8/20/14)
• 1.5 Billion - Number of Vine loops played daily (1/26/15)
• 1 Trillion - Number of Vine loops played annually (1/26/15)
• 28% - Percentage of Vine users 18-24 years of age (12/31/14)

Click Image To Enlarge 

In a blog post dated October 29, 2015, I reported that Twitter had 320 million monthly active users during their Q3 2015 earnings conference call.  User growth has stagnated and remains in low single digits on a quarter-to-quarter basis.  Increasing user growth and engagement and making Twitter easier for everyone to use is the biggest challenge facing CEO Jack Dorsey.  Video advertising has taken a foothold on Facebook, and this is widely accepted as the most effective means to reach consumers.  You can expect that Twitter will follow suit, and that Vine and Periscope video ads will play a major role in their advertising strategy.

Courtesy of an article dated December 6, 2015 appearing in AdWeek, an article dated October 27, 2015 appearing in AdWeek, an article dated December 7, 2015 appearing in R/ECode, an article dated May 8, 2015 appearing in AdAge, and an article dated July 14, 2015 appearing in Business Insider

Follow Me:   Twitter: turk5555    Facebook: 797743955    LinkedIn: turk5555 

Subscribe To My Blog Newfeed