Alert Blog Reviews

Maybe you can have too much of a good thing. As the Internet allows advertisers to slice and dice large segments of desirable markets into thinner, more defined slices it also creates something that is much less desirable: smaller profits. How is that you say? How is it possible to make less on my advertising spend when I am advertising directly to the group that most needs or wants my products? Well, it’s simple supply and demand. While you are targeting a much more defined market you are not going to be alone in that quest to advertiser to just the people that will buy. Remember those pesky competitors? They want those people too because their claim is that they are better than you. Now you are going to find a price war that drives up costs for advertising and makes customer acquisition costs rise which in turn hurt the bottom line. So maybe there is too much of a good thing after all. MediaPost tells about a study performed by the MIT School of Management that has looked at this in detail Professor Alessandro Bonatti, working with Yale University economics professor Dirk Bergemann on this research, says “… newspapers have a very limited ability to target audiences… specialized magazines can do better… Google has a very good ability to target who’s browsing each page… (though) online advertising has the potential to drive out traditional advertising, it does not necessarily follow that online advertisers will make more money… ” Bonatti continues, “…as technology keeps improving, more and more web sites can sell very narrow products to very specialized audiences… with lots of people targeting the same audience the profits to be made through specialized advertising become more and more spread out… instead of competing for one large pool… you will have price war in each targeted segment as the slice gets more and more narrow.” Bonatti concludes that, “… the better the technology, the lower the profits for advertisers… “ Not the news that advertisers want to hear but it sure is music to the ears of the niche ad networks that attract these more narrowly defined groups. Advertising price war? We’re in! Woo-hoo! Different verticals are responding more rapidly and it also is dependent on just how far CPM’s fell during this downturn / recession / economic morass. Real estate is seeing an increase in CPM’s jumping 17% from Q2 to Q3 of last year while foodies are driving that category up almost 91% in the same period. Here is a chart from Adify Vertical Gauge for you to gloss over and wonder what it really means. So be careful what you wish for advertisers. Sure it’s great to advertise as close to the buyer as you can but you’re not the only one with that strategy. Let’s hope you are the one with the deeper pockets at least.

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For Ads the More Targeted May Mean Less Profitable

We in the online world take every opportunity to turn our nose up at traditional media like newspapers because they are so 1900’s. Just take a look over the past year of posts that I have done and I at times can lead that charge. For the record, I do not relish in the fact that newspapers are going by the way side in many ways. I see that they are and it’s hard not to notice. It’s not the idea of newspapers in general that is the trouble, it’s their slow adoption of the online space and the price they are paying that is most difficult to watch. Put simply I would hate to see newspapers “go away”. It’s not likely that there will be no newspapers someday but it is likely that the consolidation and attrition in the industry will continue. Many in the online space so “So what?! Goodbye and good riddance!” I don’t. The reason I don’t has nothing to do with the nostalgia of newspapers. If I never got ink on my hands again from flipping the pages I would survive. What does scare me, however, is just how the news is actually uncovered and then reported if there was not the front line of the traditional media. A recent study in the Baltimore metro area showed that while there is significantly fewer traditional media outlets in the area the remaining ones are still responsible for the reporting of 95% of the “first run” news. The New York Times reports : Looking at six major story lines that developed over one week last July, 83 percent of the reports in local news media “were essentially repetitive, conveying no new information,” said the study, by the Project for Excellence in Journalism, an arm of the Pew Research Center. Despite diminished resources of established news organizations, “of the stories that did contain new information, nearly all, 95 percent, came from old media — most of them newspapers,” it said. “These stories then tended to set the narrative agenda for most other media outlets.” 95%? That’s a little scary if you are trumpeting the end of the newspaper medium. From an advertisers perspective it’s easy to pick on the industry but from a news uncovering and development perspective we need to be careful to not cut our online noses off to spite our face. So is Baltimore indicative of the rest of the country? Maybe, maybe not. What is of interest though is that people crave information. They crave details on events. Let’s forget about the mindless blather of the celebrity world. If you want something that superficial and fluffy then anyone can produce it. It doesn’t matter. If a mistake is made in reporting about Oprah Winfrey’s weight we’ll all survive. In things that truly impact lives it is still the job of “journalists” to report and to hopefully give the information without bias (I know, I know that doesn’t happen but one can dream….). It’s at that point that bloggers and the like can comment and help shape the news. Where are you on this one? Would it really be a good thing if newspapers and their reporting dried up and went away? Are there enough credible and scalable online news agencies to cover the amount of “stuff” that is generated and deemed important in each new 24-hour period? I don’t think so. As a result, I am a little concerned about what might actually happen if the online world got its wish and made the newspaper industry disappear. Your thoughts?

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Newspapers and Traditional Media Still Produce Most News

Facebook has drubbed MySpace on almost all fronts—in the media, with users, in growth, in traffic—except ad revenue. But expect that to change next year, according to eMarketer : “It will surpass its former rival, MySpace, in ad revenues in 2010, when marketers worldwide will spend $605 million on Facebook versus $385 million on MySpace.” The projections for next year show MySpace on a downward trend, falling from $490M worldwide this year to $385M next year. Facebook on the other hand is still climbing: from from $435M this year to over $600M next year. Meanwhile, overall social network ad spending is going up. eMarketer predicts 7.1% growth for total ad spend next year, bringing the total to almost $1.3B. Although they initially expected 2009 to see a downturn in revenue, now the stats show 3.9% growth over last year. Back in September, we saw that 20% of all online advertising was on social networks , with MySpace slightly leading Facebook (9.2% to 8.2%). I suppose we can expect the social share of online advertising to continue to grow—but not MySpace’s. The biggest factor contributing to Facebook’s revenue growth this year, according to ClickZ , is its growth. They reached 200M users in April —and just five months later, they’d added another 100M users . Now at 350M active users, Facebook has doubled in size since February of this year. Yeah, I’d say that would drive some revenue growth. What do you think? Will Facebook really pass MySpace? How has MySpace been able to retain its revenue lead for so long?

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Facebook Set to Pass MySpace Revenue Ahead of Schedule

New data from Chitika indicate that Microsoft users—both browser and operating system— click on online advertisements more often than other users. And considering what a significant portion of the market those segments constitute, that’s pretty dang good news. From a sample of over 130 million impressions, Chitika saw a click-through rate of 1.05% from Internet Explorer users, versus 0.66% from Firefox users, 0.50% from Safari users and 0.21% from Chrome users. Similarly, Windows users outclick their Mac and Linux counterparts, 0.92% to 0.52% to 0.46%, respectively. According to TechCrunch, even Bing has higher click-through rates than other search engines. So why is this large audience clicking so much? Are they “gullible,” as TechCrunch asks, not savvy enough to switch browsers or recognize an ad, or simply more engaged? For whatever reason, this large group of the market certainly constitutes a valuable segment for marketers. What do you think? Why do Microsoft users click more?

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There’s Something about Microsoft Users?

In a word: branding. As a brand, both through their own efforts and through sheer luck, Google has been able to position itself as the #1 online brand in the US according to Forrester Research . Others among the top ten, including Yahoo, Amazon, Facebook and Microsoft, have generated some of the same emotional responses from their fans. The top ten brands (note that respondents selected two from a list): Since 2007, MySpace suffered a precipitous fall in brand favoritism. Yahoo and eBay also suffered. Amazon saw sufficient growth to move from distant third to nearly tied for second; Google grew significantly in its #1 spot. Facebook and YouTube (and what the crap, Sony?) joined the list. Interestingly, both Microsoft and Apple saw small growth over that time. So what qualities made these online brands stand out in respondents’ minds? Forrester points out that we might expect attributes like prestige, popularity, speed and “the social.” And we’d be wrong. Interestingly, some of the same characteristics that associate well with offline brands: trustworthiness, helpfulness and relevance to the consumer were the top-named attributes of these brands. (In case you’re wondering, Amazon was voted most trustworthy, Google most helpful and Yahoo, Amazon, Facebook, eBay and Microsoft most relevant.) There is one point that the report makes that I don’t know if I buy: Yahoo! gets it right with “Y!ou” re-positioning. Yahoo!’s brand revitalization strategy is right on target, taking rivals on directly and clarifying its fuzzy image. Its core focus is on “relevance,” a top-tier attribute that currently doesn’t have a clear online leader. Yahoo! rivals Facebook and Microsoft show some traction here, but relevance is a relative weakness for Google. Yahoo!’s new $100-million advertising effort also highlights “fun,” another critical attribute where Google comes up short. To drive its global revitalization, Yahoo!’s new CMO brought in Landor Associates and Goodby, Silverstein & Partners to work with its main agency, Ogilvy & Mather. It launched its campaign with big TV and outdoor buys to “root the brand position.” It is following this with multichannel messaging — including explainers on its own site — around product proof points. I agree that Yahoo’s image had grown fuzzy and that taking on its rivals directly would be helpful, but are we thinking about the same campaign? Has there been more to the campaign than that one cringe-worthy commercial? (Because seriously, I wince every time I come across it on a Yahoo property.) It didn’t say “fun” to me (well, I guess it did, just not that “fun” had anything to do with online) and it definitely didn’t clarify their brand image. (How is emphasizing that “we’re as diverse as every single human on the earth—I mean, we’re just like you!” clarifying anything?) I guess we’ll have to see the “explainers” and “product proof points” to see if the rest of the campaign is effective. But so far, I’m not buying it—especially not when Yahoo’s brand has taken a hit in not only this survey, but others that correlate directly with the campaign timeline . What do you think? How have these brands acquired these attributes? Is Yahoo repositioning itself to take on more favorable attributes?

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Why People Love Google

Oh, how I wish this was a cool YouTube video that could go viral. But it’s not. Instead, it’s some pretty interesting research by PostRank on how reader engagement in blogging has evolved over the last three years. Not so surprisingly, trackbacks as a means of joining the conversation have dropped off in favor of taking the discussion to Twitter or other social sites. Over the last there years, trackbacks have dropped from 19% of total engagement to 3%, while social networks have soared from

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The Evolution of Blogging

According to a recent survey by email marketing company VerticalResponse , small and medium businesses are wising up to online marketing. For their 2010 plans, they’re big into SEM, social media and email marketing—but interest in banner ads is quickly waning. 54.2% of SMBs do not plan to use banner ads online next year. Of those that are currently using banner ads, less than 20% of businesses with 11-100 employees reported increasing their banner spend this year (and about 7% of businesses with

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SMBs Abandoning Banners