Archive for October, 2008

For years the digital media industry has been plagued by the ironic amount of paper pushing and inefficiency that should not exist in a “digital” industry. From the RFP process, to planning, to billing reconciliation, we have had an exhorbinant amount of high labor/low value work being handled by highly paid staff who we would all love to see spending their time on more strategic and valuable tasks.

The IAB has finally stepped in and just announced their proposed solution – the “E-Business Interactive Standards“, in beta (additionally the IAB released other guidelines today including guidelines for  serving into AJAX).

Admittedly creating a universal standard is a tough nut to crack, and surprisingly nobody has stepped up to the plate with universal tools to  solve this fundamental time suck of connecting buyers and sellers of digital media  electronically, I am not sure if the IAB issuing a set of guidelines and XML code is the solution, but it’s a damn good start. The tools that do exist to connect buyers and sellers are fragmented proprietary integrations into existing tools like ad servers and do not provide a universal method that makes buyers or sellers feel any efficiency. I know firsthand that agencies aren’t big fans and I’ve heard many publishers grumbling over the fact that the tools actually take longer than the manual option.

A standard must emerge. There is too much inefficiency in the paper pushing process – too much time is wasted, too many mistakes slip through the cracks.  This will be an area that I will focus on  covering throughout 2009. Stay tuned.

UPDATE: Oct 31st: Additionally to the doom and gloom now infamous Sequoia Capital powerpoint that you can access below, TechCrunch has compiled a list of layoffs in the technology and media industries. It paints a pretty ugly picture and it does feel like 2001 all over again – only the bubble wasn’t caused by our own industry this time, this is a much bigger deal…obviously. The silver lining is that digital media does have a great future and those of us who can provide tangible value amid the ensuing crazy times will continue to thrive.

Sequoia Capital Slide

Sequoia Capital Slide

ODE TO OUR IMMEDIATE FUTURE by SEQUOIA CAPITAL

This is a fairly comprehensive, albeit sobering, vision of how we got to the point we have and what we have in store with the looming recession. Sequoia Capital, one of the most active and influential VC’s in our industry shares their views…

Another week – another slough of progressive announcements from the industry leading giant.

Google made two announcements this week, one focused for small businesses and one focused on large agencies.

Honing in on the huge market of small businesses that use AdWords for text only buys, Google released a tool that helps these clients quickly and easily build display ads. They describe it as: “… lets you create professional-looking display ads in AdWords without needing to hire a designer or start from scratch…”  I haven’t kicked the tires on it, but it looks better than the MySpace MyAds builder tool that I wrote about earlier this week, which was a little rigid (v.1.0, updates to a tool like this are easy and surely will follow). Specifically the AdWords display ad builder forces a best practice or two like highlighting a call to action, this is intrinsically built into the tool.

On the agency side of town, Google has tied reporting of GoogleTV inventory into the COREMedia reporting interface, which has become pretty much the de facto standard among most mid to large agencies that buy a lot of DRTV. By tying GoogleTV reports into the CORE system, agencies can analyze results and optimize media schedules faster and more efficiently. By the way, since CORE also integrates seamlessly into Donovan and other popular agency billing systems, in theory, will make it more attractive for agencies to buy ads through GoogleTV.

While most of the industry is wondering how the troubled economic climate will affect their businesses, Google continues to laugh their way to the bank. It’s actually quite an interesting beast to watch growing before our eyes.

As social network’s Facebook and MySpace continue to drive mind boggling consumer usage, certain activities bubble to the top as immensely popular. Among those activities is photo sharing. Doug Beaver, part of Facebook’s engineering team posted a note today with some interesting facts about the amount of photos posted, shared and served on Facebook. These stats put Facebook over the previously recognized largest photo sharing site, Photobucket, which has been rolled into MySpace after last year’s $250 million acquisition.

  • 2-3 Terabytes of photos are being uploaded to the site every day
  • We have just over one petabyte of photo storage
  • We serve over 15 billion photo images per day
  • Photo traffic now peaks at over 300,000 images served per second

The question on everyone’s mind…

If a photo’s worth a thousand words, how much market cap are 10 billion photos worth?

It was no surprise to see AdAge today run a piece about YouTube’s potential as a search powerhouse. In August, YouTube’s search volume surpassed that of Yahoo, the number two search engine – that’s search volume – actual search queries – pretty amazing when you think about it.

Barack Obama's Campaign Buys Video Ads Against Keyword "John McCain"

While search accounts for the lion’s share of online ad spending, video represents a big part of the future growth and a method of engaging with consumers in a deeper manner. Google has been struggling to monetize the potential gold mine of YouTube, experimenting with varying formats and sales strategies. Search ads may provide another win-win-win – providing benefits to marketers and consumers as well as to Google itself. What it does not replicate however, is the  similar intent that consumers have while searching on a search engine, posing the question of whether this format can yield the direct response success that has predominantly led the search category into its dominant role. All things considered, this approach still creates a relevant and engaging experience for consumers – based on that criteria alone, it has legs..

What does it mean that China is about to surpass the US in the number of broadband connections? Furthermore, what does it mean that the Chinese government still exerts a level of control over the content and communication that occurs online in China?

Broadband Connections

Source: Point-Topic 2008

The technology driven aspects of the US economy have been predicated on scale. Of course, it only makes sense that China’s position as the most populous nation in the world will also be reflected in internet usage. The US internet dominance has fostered an environment for innovation, e-commerce, and recent evolution of social media. Can the tides change in favor of an eventual larger scale Chinese internet economy? The US has already been walking a step behind Asia and Europe in the mobile space and the ramifications seem temporary, as US companies are finally holding their own and growing despite the control of the US carriers, which in part created the slow mobile web growth.

All things considered, with the near collapse of our financial services driven aspects of our economy, the new media and technology driven aspects of our economy seemed to be the potential shining star. I’m sure that our internet economy will continue to thrive amid the temporary set backs of the economy at large, but keep an eye on China…that is, if you were living under a rock and hadn’t been doing so already.

Of course the power behind social media is not the advertising options, but rather the ability to monitor, learn from and connect with consumers. However, there are plenty of advertising opportunities as well, and each focuses on tapping into the social graph to create relevancy.

After months in beta, MySpace finally officially rolled out the MyAds program, allowing for self serve ad creation and targeted placement throughout all of MySpace. For the record, this is the same program that larger advertisers had access to for some time (“hyper-targeted ads”), but now  the program is available to the advertising masses…a la Google and more directly Facebook. Personally, I think this will be embraced by small advertisers in droves. While not a pull medium like search, the ability to specifically target consumers based on relevant interest is powerful, albeit I do not think that MySpace’s program, is anywhere as powerful as Facebook’s Social Ads platform.

The roll out was timed to ride the momentum of the recent launch of  MySpace Music, a platform that allows independent artists & bands to market and sell their music to a rather large and appropriate audience. The ad creation tool makes it easy for any advertiser to create IAB standard 728×90 or 300×250 ads. It’s a little restrictive, but for the Photoshop adverse, it works – upload an image or two, add text, done. The tool even includes a built in compression tool – you can upload an image up to 600k, not too shabby.

Here’s an example of a test ad I created for my underwater photography website.

Although you cannot target based on user-defined keywords like you can on Facebook, I was able to target those interested in photography & scuba diving – again, not shabby at all. But this won’t be the rifle shot case for every advertiser in every category.

Unlike Facebook, which currently stands alone as an independent, Rupert Murdoch’s Newscorp / Fox Interactive empire can always leverage the eventual base of small advertisers in the future, possibly including many local advertisers, by running ads created through this system across other Newscorp properties.

MySpace was selling over $700million in ads annually without this program. The top four search engines have over 500,000 advertisers. Can MySpace tap into that pool? Only time will tell, but I think the long term answer is yes.