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AMEX Open Blog Wins Even More Fans

Here’s more positive coverage of American Express’s OPEN Forum blog, a partnership between American Express and several FM business authors. My favorite line:

“To everyone behind the creation of the OPEN Forum, good job! To anyone who has not checked it out yet, please do!”

AMEX Open Blog June 2008

AdAge's Newspaper Death Watch

AdAge is launching a series of articles tracking the efforts of America’s 1,437 daily newspapers as they attempt to get their mojo (and revenues) back. The grim math by Annenberg’s Jeffrey Cole goes like this:

“‘When an offline reader of a paper dies, he or she is not being replaced by a new reader,’ he said. ‘How much time do they have? We think they have 20 to 25 years.’”

The series will also watch what the Project for Excellence in Journalism calls “decoupling of news and advertising.”

Here’s Battelle from a piece he contributed to American Express’s blog on the decoupling of content creation from advertising, about a month before the piece by the Project for Excellence in Journalism.

I Heart Jeff Lanctot

Among yesterday’s coverage of FM’s Series C financing was this post by Avenue A’s SVP for global media Jeff Lanctot, including his take on working with FM.

“I can say that FM has established a nice track record with Avenue A | Razorfish (my employer) over the last several quarters. Looking back to 2007, we spent nearly 4X more with FM in the second half of the year than we did in the first half. In the first quarter of 2008, our spend with FM matched all of calendar year 2007. Granted, FM started from a small base in 2007, but this kind of growth isn’t common. Looking at the reasons for their success, I think FM has done three things very well:

“1. They are clear about what they do. They don’t pretend to be an ad network. In this interview with Rafat, John says “We don’t view ourselves as an ad network…ad networks are our cousins. We have a portfolio of brands that we represent and partner with, so we consider ourselves a digital media and publishing company. Our next phase is to help those brands grow.” That’s smart positioning, because I don’t think there is room for many more ad networks.

“2. They treat every campaign as a unique opportunity. The FM team is quite genuine about providing custom solutions that work for readers, authors and advertisers. This tends to be a labor-intensive approach, so I’m not sure how well it scales. But marketers love thoughtful, integrated, on-brand ideas. FM has lots of them.”

You’ll have to visit Jeff’s site to get his third point.

Disclosure: Jeff is a pal, a client and — now more than ever — a handsome and powerful man.

Publishers Expand High-End Marketing Services Online; Where Do Ad Networks Fit In?

From yesterday’s WSJ in an article about traditional publishers acquiring web services platforms like Conde Nast’s acquisition of FM alum Reddit.

“Usually when publishers acquire technology companies it’s to spruce up their own Web sites. But increasingly publishers such as Conde Nast and Meredith are drawing on the technology to create advertising campaigns for marketers.

“This takes publishers further into the realm of marketing services. Instead of simply selling marketers ad space, they’re rolling up their sleeves and designing the promotions as well. For the next five months, visitors to the Dillard’s Web site will be able to rank products featured in a top-10 list selected by Conde Nast’s Lucky magazine and fashion Web site Style.com. The fashion lists will rotate seasonally, giving visitors the chance to rank new items every two weeks. The top-rated item on the list then will appear in Dillard’s online ads running on nine Conde Nast Web sites, including Teen Vogue, Glamour, Style.com and Vanity Fair.”

Smart. Also not surprising. High-end offline media companies have always had staff and production capabilities to provide marketing services well beyond trafficking and inserting commercials. This is part of what drives premium rates at leading media brands. Advertisers expect their media partners to do more than cash their checks; they demand that their media partners help them succeed among an audience that the media companies know best.

This is why I was confused by news that ESPN has discontinued working with ad networks. I get it that ad networks cause pricing and channel conflict because — despite promising publishers like ESPN to sell their remnant inventory in a blind manner, as part of a “channel” — they sometimes pitch site-specific opportunities. They offer lower rates for the same banners ESPN sells directly. This is a partnership problem, a serious one, but one that should be addressed with tactics short of termination. It’s not religious problem, as ESPN and others have portrayed it. From Mediaweek:

“ESPN’s decision crystallizes a philosophical debate in the online ad sales industry that has intensified since the Interactive Advertising Bureau’s annual meeting last month when during a keynote address, Martha Stewart Living Omnimedia media president Wenda Harris Millard gave her now famous warning against selling Web inventory like ‘pork bellies.’”

My interpretation of Wenda Harris Millard’s pork-bellies battle cry is this. Digital publishers need to remember that they are publishers — companies that engage with high-quality audiences around content in a unique and magical conversation, and service firms that know how to chaperon marketing brands into those conversations. In other words, companies in the mold of Conde Nast, Meredith and ESPN that offer high-touch marketing services.

Whatever ad avails you don’t sell, offer up on the pork-belly exchanges — online we call them ad networks (or Google Adsense), in TV we call them PI or DR rep firms. Hey, people sometimes want pork bellies, and audiences almost certainly don’t want 30-seconds of white static whenever a TV network fails to sell 100% of spots.

But if you don’t or can’t articulate what it is that makes your media brand uniquely valuable to your marketing partners (hint: it’s not your demographics), you’ve ceased to be publisher.

More on the difference between publishers and ad networks from Battelle.

Battelle on Media Brands and How They Earn Their High CPMs

Great thought piece at Searchblog on the value of branded media online.

“Why is it that a brand marketer looking to reach college educated women, 18-34, is willing to pay $40 CPMs in Vanity Fair, but just $3 in an ad network?

“The first and most important reason is engagement — the reader of Vanity Fair is engaged in the magazine, and when she comes across that Lancome ad, the chances that the ‘between the ears magic’ will occur is far greater than at a random site run by an ad network. The second and related reason is creative — a two-page spread is simply a far more effective media vehicle for the brand’s message than the IAB unit.”

Overcoming these two hurdles comes down one thing: Marketers need to think like publishers. Publishers — a term I’m using here to include the creators of magazines, newspaper, websites and TV programming — are deeply committed to converting first-time trial readers or viewers into loyal subscribers or appointment-TV watchers; it costs far too much money buying audience, carriage and circulation (not to mention producing the content) to survive any other way. They must engage that audience. Marketers, meanwhile, recognize that it’s a waste of money to advertise with media properties that haven’t created engagement.

Marketers are also wasting money if they place advertising in high-engagement environments yet fail to provide creative that likewise engages the audience. The best TV commercials from the past six decades are 30-second and 60-second films that have overcome their miniature running times with brilliantly-crafted narrative arcs, evocative performances, catchy music and captivating cinematography. In other words, with filmed content. The creative units attached to online ad campaigns must move beyond call-to-action blinking banners. They need to become portals into content experiences that rival the great content at the best media sites.

Battelle, ESPN: The Trouble With Ad Networks

Battelle takes a deep look at the difference between media companies and ad networks at Searchblog, and how the big online portals are confusing the two.

“Do we [in the media business] sell inventory to the highest bidder via algorithms, automated processes, and platforms? Or do partner with marketers and creators of media to build brands – both media brands, and consumer marketing brands?

“I know how the folks who no longer work at AOL, Yahoo, or MSN feel about this question. They’re all brand people. And it’s entirely clear how the Google-chasers have answered that question: They’ve collectively spent billions of dollars amassing ‘access to inventory’ and ‘ad platforms’ in single-minded competition with Google.

“It seems the future, according to AOL, Yahoo, and Microsoft, is in ad networks.”

Meanwhile, one of the top brands in quality content and marketing relationships with global brands, ESPN is severing ties with ad networks:

“The sites like ESPN have cut ties with Specific Media and several other ad networks saying that ad selling that relies heavily on arbitrage and algorithms is not for them. ‘We’re heading down a path where it no longer suits our business needs to work with ad networks,’ said Eric Johnson, Vice President, Multimedia Sales, ESPN.”

Jeremiah Owyang, MediaPost Cover Dell's Facebook Graffiti Contest

Jeremiah Owyang, at his site, writes up a case study of Dell’s Facebook Graffiti Contest, part of its ReGeneration campaign. His “what could have been better” section — that conversational campaigns should be given longer life spans, and that the content they produce should be given more exposure too — is worth a full read at his site. His summary of the campaign overall:

“Unlike most marketing campaigns that deploy heavy ads, fake viral videos, or message bombardment, this campaign let go to gain more. Overall, this is a successful campaign as they turned the action over to the community, let them take charge, decide on the winners, all under the context of the regeneration campaign. The campaign moved the active community from Facebook closer to the branded Microsite, closer to the corporate website, migrating users in an opt-in manner that lead to hundreds of comments was clever. Well done.”

And MediaPost’s Social Media Insider blog says:

“There are a lot of impressive stats here: 1.1 million people voted on their favorite illustration, 7,300 people entered a submission, the contest has almost 1,300 friends, and there are currently 209 comments to the post at ReGeneration.org announcing the winners. Clearly, Dell’s ReGeneration effort supports [FM CEO John] Battelle’s contention that social media may finally make online advertising much more interesting to users than the ongoing crop of forgettable banner campaigns.”

American Express OPEN Forum SMB Content Site Gets Link Love

The more high-quality, credible content that’s published at American Express’s OPEN Forum blog site, the more instances that other sites will tell their readers about it, link to it and improve the OPEN Forum’s “relevance” in search engines. Here’s another from the official WOMMA site.

WOMMA Points to AMEX

Adweek: Not All Ads On Facebook Perform Poorly

From Adweek’s coverage of a panel at Ogilvy’s Verge conference. Outgoing Facebook chief revenue officer Owen Van Natta defended the company’s Beacon advertising concept, while Gawker’s Nick Denton slapped back:

“Gawker media publisher Nick Denton said he believes the ‘innovation’ in social media ad models is mostly a result of their failure as media properties. Even MySpace gets higher click rates than Facebook display units, he noted.”

FM’s Battelle disagreed:

“Not all ads on Facebook perform poorly, though. John Battelle, founder of Federated Media, said Facebook applications like Graffiti Wall are running ad campaigns for companies like Dell that are performing well by all metrics. ‘There’s no engagement in ad networks,’ he said. ‘We haven’t yet figured that out yet, and I think social media will.’”

Battelle to SMBs: You're In The Media Business Now

In a recent post on American Express’s Open Forum site, Battelle tells business owners who interact with their customers online: You no longer just selling widgets, you’re in the media business. The point is this, don’t define yourself by what you sell (“we sell trains!”) but rather the service you provide your customers (transportation services). American Express — the company that’s paying Battelle and other business authors to license their content — gets it. The Open Forum site isn’t about selling plastic debit cards, it’s about empowering their customers with tools to grow their businesses, plastic debit cards and insightful business content included.