You are currently browsing the archives for October, 2006.

Google Concedes That Humans Rule

Jason Clement, associate director of search engine marketing at Carat Fusion, remarked in the Washington Post on Google’s historic preference for bots over humans when it comes to selling advertising: “The scariest thing about Google is they don’t know what they don’t know. There’s a difference between a Harvard mathematician and someone who’s been selling ads for 20 years. The mathematician is smarter, but if you want Coca-Cola’s dollars, the guy selling billboards for 20 years is the one you want.”

But perhaps Google execs are changing their attitude on this front. Battelle breaks the news that Google has altered its long-standing, long-controversial HR policy requiring all new recruits to show proof of a 3.0 or better GPA in college, even if a recruit went to college a long time ago (Searchblog). Wow. I guess Google realizes it needs to hire inefficient, expensive humans — even us sometimes-poor-academic-performing ad sales types! — if it wants to succeed in the brand-advertising marketplace.

Nielsen Rates Commercials; NBC & CAB Pull Out

When I saw the headline at AdAge, I had to laugh.  Nielsen finally starts measuring actual viewership of the commercials (not just the shows in which those commercials reside) — about 25 years after the invention of the remote control — and NBC’s cable unit and the Cable Ad Bureau immediately opt out under protest!

But there’s more to it.  First, it sounds like cable is more defensive than broadcast about the issue:

“When stacked against the broadcast networks, cable networks have done poorly when it comes to how many viewers stick around for the ads. While a broadcast network might typically lose 5% of viewers watching the shows, cable might lose between 8%-10% of its audience during the breaks. Many in cable believe that the way Nielsen is calculating viewership of commercials has too many flaws and they don’t want media buyers or clients drawing conclusions about cable’s performance.”

The other issue is a bigger one: Can the big panel-based survey firms do a good job with niche (or “local” in the case of TV):

“Among the issues irking cable channels are Nielsen’s ability to properly and consistently identify local vs. national spots. Commercial ratings are only supposed to measure the ratings of national commercials.”

Nielsen, Arbitron, Comscore and the rest need to figure out how to change their approaches to match consumer behavior.  As we consumers take advantage of more choices (aka, media fragmentation), the metrics bodies need to follow us; they need to build panels or technologies that don’t break for every niche or not-exactly-mainstream content outlet.

Only 19% of Americans Surf Web Via Mobile Phone

Which lags behind Europe, where 29% browse the web from a handheld (Mediapost).

Geoff Ramsey: Is Our Attention Less Fragmented Than Our Media Choices?

Yes. But just because each of us (using the average online user to stand in for “us”) can only take in 17 sites per week doesn’t mean we’re heading down a path of consolidated consumption with a few big sites that we all visit. It more likely means we all have our own 17 favorites, with some that overlap. There will be media consolidation from the ad-buying standpoint, but I’m guessing our “attention” has permanently fragmented.

Geoff’s other big point: The coming battle among online media companies will be for brand dollars. Yahoo’s had a bad year next to Google. But they’re much better positioned than Google to lead in the next phase of online advertising growth.

Here are some great stats and insights from his presentation at OMD last week (eMarketer):

–US online ad spending will be just shy of $16bn this year, $18.3bn next year and over $25bn in 2010. [Fifteen percent (15%) growth ain't bad!]

–In 2006, investment in online brand advertisng was up 26.8%, the same growth rate as online direct response. In 2005, brand spending grew 13.6% versus DR’s 41%. In 2008, brand spending will be up another 18.5% while DR will grow only 13.4%. [This is an important trend. Nearly every advertising start-up I can think of (FM excepted) is building a better mousetrap for direct response advertising in order to steal share from Google. Meanwhile Google is hiring traditional ad sales folks from the brand-advertising world, though Google's to-date attempts to break into brand dollars have yet to catch fire.]

–The big online news sources (Yahoo, MSNBC, AOL & CNN each have 10-16MM weekly visitors) reach more weekly readers than the big broadcast news sources have viewers (NBC, ABC, CBS each reach between 6-8MM viewers).

–The average US household has 94 channels, but viewers in that household watch only 15 per week. Online the phenomenon is more exaggerated: Tens of millions of sites, but the average online user visits only 17 per week.

–Video ad spending is forecast to be $385MM in 2006. This will grow to more than $2.3bn by 2010.

File Sharing May Be Illegal; But Labels Now Selling Ads in Files

From the WSJ:


“But now there’s a growing recognition among some record executives and performers that the people who are downloading illegally are frequently huge music fans and that marketing to them may be more desirable in the long run than suing or otherwise harassing them.Hence the alliance between Jay-Z and Coke. By inserting promotional material into the decoy files, and then planting those files prominently on file-sharing sites, record labels and other marketers can turn what is now an antipiracy tool into an advertising medium. ‘The concept here is making the peer-to-peer networks work for us,’ says Jay-Z’s attorney, Michael Guido. ‘While peer-to-peer users are stealing the intellectual property, they are also the active music audience,’ and ‘this technology allows us to market back to them.’”

It’s a funny logic: We still may sue them, but we admit they are our best customers.

94.3% of Affluent Working Women Are Online

Online usage is up among working women with HHI above $75,000, while TV, radio and print consumption among this group is down. From the Media Audit:


“The percentage of working women that spent at least 430 minutes a week on the Internet (heavy users) jumped from 48.6 percent in 2004 to 50.8 percent in 2005,” says [Bob Jordan, president of International Demographics, Inc.]. “Heavy use of radio, television, newspapers and direct mail all declined within this group. The collective Internet changes for this group are significant, and other media is… paying the price.”

Wal-Mart's Fake Blog Spawns a PR Disaster

Richard Edelman, president and CEO of Edelman PR, apologized yesterday for creating — without disclosing that Edelman and Wal-Mart were behind it — the “Wal-Marting Across America” blog. From Mediapost:


“Ostensibly a chatty travelogue written by two average Americans who parked their RV nightly in Wal-Mart parking lots and wrote endlessly effusive prose about their experiences with the retailer’s employees and customers, the ‘flog’ (or fake blog) became a marketing communications disaster for both client and agency when it was revealed that the vehicle, meals and all other expenses were paid for by WFWM, an organization launched by Edelman, and that St. Claire’s brother worked for the PR agency on the WFWM account.”

The blog was revealed to be a flog, and the potential for PR lift turned into a sink hole. Edelman’s comments yesterday: “I’m sorry we did this. I am completely committed to doing better, not only for our firm but also the PR industry. I want your readers to know I take all this very seriously.”

Steve Rubel, an exec at Edelman and the voice of Micro Persuasion, had no direct connection to the project.

Battelle Interview in Online Journalism Review

Sarah Colombo interviewed Battelle at OJR on blogging, journalism and FM’s approach to making money for them both. Battelle on FM:

“The general idea is that not all journalists or authors who can draw a community want to be the CEO of a publishing company. They care about getting paid but aren’t very interested in selling ads. They care about making the site look good, but they don’t want to take care of the back end. They don’t want to necessarily hire and manage an accountant and controller, but they certainly care that their check comes on time.”

Will Yahoo Get Bought?

Fred Wilson at A VC speculates that Yahoo would be a good deal for an acquirer right now:

“Here are the facts. Yahoo! trades at a $34bn market cap. They generate almost $500mm per quarter in cash flow, that’s $2bn per year. So on the face of it, it appears that Yahoo! trades at 17x this year’s cash flow. But that is misleading because Yahoo!’s got a bunch of cash on its balance sheet and also owns a nice chunk of Yahoo! Japan. So after you take out that cash and Yahoo! Japan, Yahoo!’s core business might trade at something like 12-13x EBITDA. You could pay an acquisition premium to the public shareholders and still make a return at that price.”

Fred explores the possible suitors: News Corp, Comcast, Time Warner and — the most likely — Microsoft. But Fred says it’s a longshot that a deal will happen: “I think the chances that Yahoo! actually does get bought is slim, but even the fact that the market is having this discussion is a wake up call for Yahoo!’s board, management, shareholders, employees, and customers.”

Beet.tv Interview on FM

Andy Plesser, founder of Beet.tv, sat me down for an interview last week at the “Future of PR” conference. The topics: what services does FM provide its authors and how does FM select authors to invite into the fold?