Google’s bread and butter is paid search but that doesn’t mean that it doesn’t have big ambitions for its display advertising business. After all, it spent $3.1bn in 2007 buying display advertising giant DoubleClick.

Google’s challenge in taking display to greater heights is simple: show advertisers the money (read: ROI). The ease with which paid search ROI can be tracked is a big part of paid search’s success. When it comes to display ads, however, that ROI is hard to pin down, because, well, ‘nobody clicks on display ads‘.

About a year ago, Google started beta testing a new tool called Campaign Insights. Its purpose: help advertisers find the ROI in display advertising. According to AdAge, the tool has been tested with advertisers such as PayPal and Simplexity. And today, Google is expanding the beta to larger advertisers in the UK and US as it moves toward an eventual launch of the tool for all of its advertisers.

AdAge explains how it works:

With Campaign Insights, Google takes data from the advertiser’s server logs to determine who was shown an ad and when. Then compares that to web searches and site visits culled from data from the millions of Google toolbars on computer desktops. Those results are compared to a comparable group that didn’t see the ad.

Then Google measures the difference between the number of brand searches and site visits between the two groups. To filter out the impact of other media or influences, such as a TV campaign, Google compares the data to the two groups’ behavior before the campaign began. The incremental difference is attributable to the display-ad campaign.

It’s an interesting approach, one that AdAge notes is similar in nature to what Microsoft has been doing. Google’s advantage: the millions of upon millions of computers that have the Google toolbar installed and Google’s access to DoubleClick’s cookie, which is used just about everywhere a Google ad is displayed.

Of course, some will point out that Google toolbar users aren’t necessarily a great sample but I think it’s pretty obvious that there’s never going to be a ‘perfect‘ way to measure brand life from digital marketing campaigns. But if Google can show advertisers that their display ads have an impact on search ads, Google might be able to convince advertisers to pour more dollars into display. As AdAge correctly notes, paid search “tends to get the majority of credit for web activities because it is most likely to
be the last action before a site visit or sale“, but savvy advertisers know that the last click is hardly the only thing that counts.

Photo credit: Yodel Anecdotal via Flickr.

Tweet This Post

Related posts:

1. Are marketers moving their Google search dollars to Facebook’s display ad business? Wired’s argument this spring that Facebook is the next Google...
2. Aggressive data mining isn’t a problem, but… This weekend, AdAge published two articles discussing the lengths to...
3. Google pulls the trigger, gets into lead gen In late August, we reported on a lawsuit filed against...

Related posts brought to you by Yet Another Related Posts Plugin.

Gary Vaynerchuk transformed online wine sales at his parents business through his passionate and entertaining wine videos online. The New Jersey based wine retailer took to the web in 2006, and since then his popular Web video series “Wine Library TV” has boosted both Gary’s public profile and his parents’ liquor store — from a $4
million annual business into a $45 million one.

His video blog attracts an average 80,000 viewers for daily tastings and commentary, and Gary has appeared on mainstream media outlets from Conan O’Brien to The Today Show. His unconventional approach to wine (he convinced O’Brien lick a rock and to get at some of the notes common in wine) has earned him a cult following.

This week, he released the first book in his ten-book deal with Harper Collins. “Crush It! Why NOW Is the Time to Cash In on Your Passion” advises readers on how to turn their hobby — through enthusiasm, hard work and the power of the Internet — into a successful career. I caught up with Gary to chat about how he built his business on social media and why successful people who advise against working hard are lying.

Your new book is about following your passion. Is it important to have an area of expertise to follow your advice?
This is why you have to focus on the passion part. You’d be surprised
how many people think of themselves as enthusiasts that really are
experts. It’s a switch of the dial. It’s very obvious to me that I know
more about the New York Jets and football than the majority of announcers. It’s nothing personal, it’s nothing egotistic. I think there are lots of people who
have that same passion for cooking. Do you know how many people who
cook at home have more expertise than television chefs? I think that people relate that they have a passion. They just don’t think of themselves as experts. There is a global lack of self-esteem.

Do you attribute your success to being ahead of the trend of online video?
I firmly believe that if I started tomorrow, in six
months I’d be in a very big place. Commitment and hustle and hardwork
are the most important thing. Being first to market is fun. This is the first time I’ve ever been
first to market. In retail, people have sold wine before. I was first to market with the video blog, but I definitely had to eat a lot of crow. In February 2006, people were not talking about video blogging. I had to be extra enthusiastic. If you stuck it out you could be the voice of a new genre.

You have a video response to new emails that explains why you might not get back to people immediately. It reminded me how much your brand has grown since you started. Do you lose some of the personal touch of social media as you expand?
It’s caring that i care about. Scaling caring is easy. You have to be creative and come up with videos like that one. But a
human being is only so scalable. I focus on effort. I just try. Trying,
when it’s authentic and people can see it, I think it’s appreciated. You lose some emotional people who say you’ve sold out or don’t care
anymroe. But you can keep 85% of the ones who are practical and understsand — the
guy had a kid, this is the way things go.

Is damage control easier in social media?
Absolutetly. Now you can be on video responding to
the criticism in 30 seconds. Back in the day, if you had criticsm — what
if the press didn’t give you a platform to rebuttle? That happened a lot. What are you gonna do, buy an ad? You’ve heard how
people bought ads just to get their message out. You don’t have to do
that anymore.

Is there a limit to how far social media can take a business?
Everything has a limit. Social media doesn’t reach everybody. it depends on where you’re going. Can a brand just rely on social media to build a business? I think it can. You start building and then you can start doing other things. I definitely think it can. It’s the only platform where you can not spend much money and get a big, big return.  There are so many free tools now that you can start up with nothing. That’s pretty much the thesis of everything I believe in. The fact that you can create, distribute and advertise for no money. Stuff that cost millions of dollars back in the day. Back in the day, by the way, was about ten years ago.

But is it harder now?
It’s harder. The end. We’re going to live in a thank you economy. it’s going to be all about customer service.

What do you make of Caterina Fake’s argument that working hard is overrated?
I think she’s out of her fricking mind. Because why? Because she
freaking words
hard. I just don’t get that. The people that talk about not working
hard are the one who work the hardest. Tim Ferriss (of the 4 Hour Work
Week) works all the time. Caterina (who helped found Flickr and search engine Hunch) works the hardest. I totally
disagree with that.

She’s
really ambitious and trying to create a business. Somebody who’s lazy
and making $40k a year, if she flipped the switch would make $100k a
year. There’s been plenty of big time ideas that people didn’t work
hard on that failed. And there are a ton of lame ideas where the person
squeezed every once out of that lemon and made it successul. Working
hard is a fundamental requirement for success. Show me the one person
who hasn’t worked hard and is successful. When you can show my that
person, then I’m in. I’m dying for someone to give me a good example.
The only people who don’t work hard and have it good are the ones who
have parents who worked hard. The ones working off the hard work of someone
prior to them.

How much sleep are you getting these days?
About four hours. The baby has not really been the issue. The baby hasn’t really crushed me, it’s the book.

So your book is called “Crush It!” but it’s crushing you?
Ha. Yeah, that’s true. It’s funny.

Tweet This Post

Related posts:

1. Will film distribution go the way of the magazine industry? With ad pages in freefall, magazines shedding titles, and the...

Related posts brought to you by Yet Another Related Posts Plugin.

SEO is a polarizing subject. Bring it up in the company of the tech set and chances are you’ll get a debate not unlike one you might get when talking about religion and politics.

A lot of the criticism of SEO is misplaced while some of it isn’t. When addressing SEO criticism, it helps to have an understanding of why critics are so skeptical. Here are top 10 reasons.

They don’t know what SEO is. While the phrase ‘search engine optimization‘ seems pretty straightforward, it’s pretty obvious that many of the most ardent SEO critics don’t really know what SEO is. Case in point: Derek Powazek’s recent attack on SEO equated botnets and hacking attempts with SEO, a clear indication that Powazek didn’t really know what he was talking about.

They had a bad experience. There’s plenty of SEO snake oil out there and a bad experience with an SEO snake oil salesman could easily lead someone to believe that SEO itself is a scam. People throw the baby out with the bath water all the time and SEO in particular is no exception.

They’re listening to the wrong people. It’s easy to form a bad opinion of just about anything if you listen to the wrong people. Just as in social media, there are plenty of people in the SEO world who promulgate myths, misstate facts and make sweeping proclamations. These things aren’t always done intentionally but the harm is done regardless. Unfortunately, the people who are most apt to do these things are often the ones who have the time to hog the spotlight and are most visible to newbies.

They’re jealous. If the competition has great SERPs thanks to its SEO efforts, and you don’t, it’s convenient to criticize the competition’s use of SEO. After all, you’re better than the competition so any competitor who appears more prominently in the SERPs must be scheming, right?

They’re lazy. SEO is hard work. From learning the basics to staying abreast of the latest trends to actually applying your knowledge in practice, SEO, like most things worthwhile, requires hard work and an investment of time. Out of all the people who criticize SEO, how many do you really think have actually made a reasonable effort to see what SEO can do for them?

They already have great SERPs. It’s completely possible to obtain great SERPs without making a dedicated SEO effort or being an expert SEO. That’s because so many of the important aspects of good SEO (content, information architecture, design) aren’t exclusive to SEO. So someone who has acquired great SERPs but who didn’t consciously focus on SEO has good reason to ask what all the SEO hoopla is about.

SEO seems too complicated. SEO is a nuanced field and in many areas, there are no black and white answers. Much is unique to individual circumstances and there’s also a lot of myth and misinformation that needs to be sifted through. This can easily deter someone.

They experienced failure. There’s no magic formula when it comes to SEO and results aren’t realized overnight. For the impatient, a lack of instant results can serve as the foundation for SEO skepticism.

They’re master link builders. What’s one of the fastest ways to acquire new backlinks? Write an inflammatory post calling SEO a scam. Oh the irony!

They’re full of nonsense. A lot of the people who criticize SEO don’t really believe what they say. Take Jason Calacanis, for instance. He’s said some pretty mean things about SEO yet his company, Mahalo, is basically an SEO play. And uses some pretty aggressive tactics at that.

Have I missed anything? What rationales have you seen behind SEO criticism?

Photo credit: Search Engine People Blog via Flickr.

Tweet This Post

Related posts:

1. Forget Facebook. Privacy issues are brewing in people search. With all the negative attention that Facebook has received for...

Related posts brought to you by Yet Another Related Posts Plugin.

Market size and growth (Econsultancy Email Marketing Platforms Buyers Guide)

• The UK market for email marketing platforms and services was worth £254m in 2008 and is predicted to grow by an estimated 15% to a value of £292m by the end of 2009.

Open and click rates (Epsilon)

• Epsilon stats from Q2 of 2009 found that 14 out of 16 industries
  experienced an increase of 18% or more in email open rates compares with Q2 2008, while click rates
  remained at 5.9%.
• Financial service companies’ emails were most likely to be opened, with an average open rate of 35.6%
  in Q2 2009, compared with 28.4% the previous year. Retail email, by comparison, had an average open rate of just 13.4%.

Smartphones and email usage (ExactTarget)

• Smartphones with internet access have had the effect of increasing email activity amongst users.  43% of Blackberry and 41% of iPhone owners say that they have used email more often over the last six months, compared with 26% of non-smartphone users.
• Two-thirds of smartphone owners say they use email on their phone, a 5% increase over the last six months.

Social networks and email usage (ExactTarget)

• A recent ExactTarget study suggests that social networks have contributed to increased email usage:

• Email is used more regularly than social networking for personal communication. 79% of respondents use email as their primary mode of communication, only 10% use social networks. (Epsilon)

Deliverability

• Two fifths of Europe’s email marketers don’t know if their email messages are being successfully delivered. (Return Path)
• Only 18% of companies know what percentage of their email budget is lost through non-delivery. Company respondents said that 10% of email is lost through non-delivery on average, though agencies estimate this to be even higher at 14%. (Econsultancy Email Marketing Industry Census)
• Email deliverability is still an issue for companies, with an average of just 79.3% of permission-based commercial emails reaching inboxes in Canada and the US. (Return Path)

Tweet This Post

Related posts:

1. Political parties fail on email marketing It seems that the UK’s political parties have a lot...
2. Nine inspiring multichannel marketing presentations Whether you are an offline marketer or digital marketer, developing...
3. Web retail goes for the win this holiday season Rumours about the economy being poised on the brink of...

Related posts brought to you by Yet Another Related Posts Plugin.

If you’re an iPhone app developer, free versus paid can be a difficult decision. Notwithstanding widely-publicized success stories, most free apps don’t make any money for their developers.

One solution: use a free, watered-down version of your app as promotion for a paid version. The freemium model does work but it’s hardly perfect. The problem: Apple doesn’t offer a way for app users to easily upgrade from a free version to a paid version. Developers have to create two different apps and app users have to install both.

Until now that is. Yesterday, Apple sent an email to developers announcing that the in-app purchasing functionality that is currently available within paid apps will be available in free apps:

In App Purchase is being rapidly adopted by developers in their paid apps. Now you can use In App Purchase in your free apps to sell content, subscriptions, and digital services.

You can also simplify your development by creating a single version of your app that uses In App Purchase to unlock additional functionality, eliminating the need to create Lite versions of your app. Using In App Purchase in your app can also help combat some of the problems of software piracy by allowing you to verify In App Purchases.

This is big news for developers. With in-app purchasing, the number of ways to effectively employ a freemium model with iPhone apps increases significantly. In my opinion, this could pave the way for a second iPhone gold rush.

A couple of reasons:

• Savvy developers can now create more compelling free apps. There possibilities for in-app purchases are virtually unlimited. But because in-app purchases were only available with paid apps, the market for in-app purchases was far smaller than it could be. After all, not everyone with an iPhone is willing to purchase paid apps and there are plenty of developers who would be more than happy to employ a model in which they give their apps away for free but sell additional content and functionality in-app. Now that developers can create free apps that offer additional content ad functionality for purchase in-app, expect the market for in-app purchases to grow exponentially.
• Upselling is going to be far easier. Getting somebody to who has downloaded the free version of your app to go through the process of purchasing and downloading the paid version can be tough. The need to purchase and download a completely separate app creates a lot of friction. Now that developers can upsell paid content and functionality and the app user won’t have to purchase and download a separate app, upselling will be easier and the barrier to completing the sale goes down significantly. The best developers will be able to develop user experiences that drive impulse in-app purchases.

In short, this move by Apple was a no-brainer and I expect it to boost the amount of opportunity in the App Store economy. Of course, there will no doubt be fierce competition as users are bombarded with free apps that try to upsell them on paid content and functionality but the reduction in friction should be welcome by iPhone app developers.

Photo credit: katielips via Flickr.

Tweet This Post

Related posts:

1. 30 iPhone apps reviewed 2009 may not have been the much vaunted year of...
2. Pizza Hut iPhone app generates an extra $1m sales Another example of the potential of mobile commerce comes from...
3. Greg Le Tocq on the VoucherCloud iPhone app VoucherCloud is a new iPhone app which provides discount codes...

Related posts brought to you by Yet Another Related Posts Plugin.

Google reported its third quarter earnings after the close of the US stock exchange today and, as it has done more than a few times in the past, the Mountain View company delivered more than analysts were expecting.

Net revenue in the quarter was $4.38bn with earnings per share of $5.89. Analysts had expected $4.24bn in net revenue and $5.42 in earnings per share. All told, total revenue was up 7% year-over-year. So the good news: Google is managing to grow even in a very tough economic environment. The bad news: growth is, by past standards, a bit modest.

Google CEO Eric Schmidt is clearly hoping that won’t be the case for long. In the company’s press release, he stated:

While there is a lot of uncertainty about the pace of economic recovery, we
believe the worst of the recession is behind us and now feel confident about
investing heavily in our future.

Time will tell if he’s right, and whether the end of the Great Recession will mean a return to ‘good times‘. But there’s no doubt that Google’s core business has managed to do quite well given the circumstances. Year-over-year, paid clicks were up 14% in the third quarter compared to Q3 2008 and up 4% from the second quarter of this year. The average cost per click was down 6% year-over-year but increased 5% quarter-over-quarter, perhaps indicating that many of the advertisers who had cut spending or left the market during the worst of the recession have returned and are bidding up keywords again.

The question for Google now is where it goes next. While there’s no doubt that the recession has impacted growth, it’s also clear that Google is a mature company whose cash cow can only keep growing so fast. Today, it more closely resembles an industry veteran like, say, Microsoft, than a fast-growing upstart like, say, Facebook. It has a lot of things going on (YouTube, Android, the upcoming Chrome OS) but none yet look like they will propel massive revenue growth in the near future.

Will Google look elsewhere for this growth? With $22.0bn in the bank as of September 30, there are no shortage of acquisition opportunities. If Eric Schmidt really feels the worst is behind us, it wouldn’t be surprising to see Google make some moves over the next few quarters.

Photo credit: dannysullivan via Flickr.

Tweet This Post

Related posts:

1. Are marketers moving their Google search dollars to Facebook’s display ad business? Wired’s argument this spring that Facebook is the next Google...
2. Fast Flip, Google`s New News Reading Service For quite some time Google and newspaper and magazine publishers...
3. Google gets free advertising for Google products by hiring ex-Microsoft employeessex Don Dodge was a happily loyal Microsoft employee until last...

Related posts brought to you by Yet Another Related Posts Plugin.

SAI’s Internet Analyst spoke with an ad agency that has noticed brands quietly moving ad dollars from Google search to Facebook’s new self-serve display ads. If this becomes a trend, it could be huge for Facebook.

According to SAI:

“A small percent of the search agency’s clients (but “more
than a handful”) are now using some of their search budgets on
Facebook’s self-serve display ads.  This is money that would otherwise have gone to Google and Yahoo.”

Google itself has recently gotten into the display ad game with the DoubleClick Ad Exchange, which could head some of its ad loss off at the pass, but there are specifics about Facebook self-serve ads that make it very appealing to brands.

For starters, the information voluntarily shared on Facebook provides advertisers with impressively targeted advertising. SAI also says that Facebook’s performance and ROI metrics are rivalling and at times even exceeding search.

Facebook has been hard at work trying to trun its popularity into an
effective advertising model. And there are a few indicators that those efforts are starting to pay off.

For starters, Facebook is increasing its interaction with users. The social network’s marketshare is up 194% since last year, according to The Internet Analyst. In comparison, MySpace has lost 55% of its marketshare over the last year.

But beyond the amount of people using Facebook versus MySpace, Facebook users are also more engaged. Average time spent on MySpace is down 12% since last year, while time spent on Facebook is up 23%.

New strategic partnerships are also helping Facebook’s ad business. Facebook Connect is helping the social net insert itself in more of the activities that people partake in online. It’s also growing the

And if the Facebook/Google comparison needs any steam, Facebook is also gaining in the search market. The site may be a small player in terms of the overall search market, but Facebook recorded the most growth in search in the last quarter — its 384 million searches represented a gain of 19%.

Facebook has mainly been working on increasing its stickiness with users, because the more people use the network and related services, the more valuable its advertising becomes.

According to Silicon Alley Insider, if the early success continues:
“self-serve display ads could do for Facebook what AdWords did for
Google.

Tweet This Post

Related posts:

1. Google gets deeper into display with Campaign Insights Google’s bread and butter is paid search but that doesn’t...
2. Facebook could send small marketers running with contest rule changes Three weeks ago, Facebook changed the rules for brands...
3. Forget Facebook. Privacy issues are brewing in people search. With all the negative attention that Facebook has received for...

Related posts brought to you by Yet Another Related Posts Plugin.

With ad pages in freefall, magazines shedding titles, and the future of magazines in flux, things are looking more than gloomy for the ad industry lately. And the same fate is likely to befall the dvd industry, according to Netflix CEO Reed Hastings.

Speaking at Magazine Publishers of America’s Innovation Summit, Hastings noted that his business is on track to suffer the same fate that magazines are enduring now. Is there anything to be done about it?

Netflix has made its name out of eating Blockbuster’s lunch — capitalizing on the changing technological landscape and moving consumers toward a subscription model rather than a pay per use rental system. But as technology continues to change, the physical rental of dvds is also soon to be a thing of the past.

Netflix currently straddles both worlds. While it offers streaming movies online for free to paid subscribers, that model is not yet providing a viable revenue stream.

According to PaidContent, Hastings says they are just getting users acclimated to the online viewing experience at this point:

“We have the same tensions between print and online. The broadband
people can’t believe they have to support the DVD side. But we’re
working towards the day when streaming is dominant. We’ll have to deal
with it. But right now, our focus remains on the DVD side.”

Asked if a “Netflix-for-magazines” could work, Hastings said that bundling magazines for a subscription fee could be a working business model. But the problem arises when John Byrne, BusinessWeek.com’s editor-in-chief, asked Hastings if he’d be willing to pay for that service. According to PaidContent:

“Hastings hesitated, but with Byrne’s gentle
prodding—and looking out over a magazine audience who just finished
their lunch—shrugged and said sure.”

That’s not a very reassuring answer. And unfortunately, consumers who are making purchasing decisions are even less likely to pay for something they currently get for free online.

Hastings is aware that a similar digital transition is coming for his own business, which puts him one step ahead of Blockbuster when Netflix came gunning for its business a few years ago.

But coming out on top at the end of the next shift is another story. There are more high quality video purveyors online every day. While Hulu may mostly stream television content now, if users get accustomed to going there for their video needs, it will be hard for Netflix to peel off users in the space. Similarly, YouTube is working toward partnerships with more film companies to get their content streaming on its site. And YouTube’s footprint with consumers is a powerful thing.

When web viewers do start going online for all their film needs, will they be interested in a subscription model like Netflix’ or an ad model, or something entirely different?

It’s clearly not a content problem that faces the magazine industry now, or Netflix in the future. It’s a payment issue.

As Hastings said of magazines, and foreshadowed his own issues, at the Innovation Summit:

“I read them online. I love the content, only now I don’t pay for it.”

Image: PaidContent

Tweet This Post

Related posts:

1. HBO Go’s exclusivity will work to Netflix’s gain It’s 2010, and HBO is getting with the digital...
2. Pandora’s lesson: Your first business model doesn’t have to be your last The road to online music streaming is littered with the...

Related posts brought to you by Yet Another Related Posts Plugin.