Matt Harty – Previously published at ClickZ.Asia

With the recent announcement that Google confirms AdMeld buy, it’s an interesting time to look at the ‘search giant’ and see the advertising machine that it has amassed. What would a Google ownership of AdMeld mean? What is Google’s display media play?

Google has made no secret of its desire to dominate the display media market. With the modernisation of the display market in full swing, it is an excellent time for a company with Google’s credentials to take a leading role in the path forward. Display is getting more like search in accountability and the way it is offered. Interesting times…

So what ad products would Google have:

• Search (search engine marketing) – Google is the heavyweight champ
• Premium ads (guaranteed inventory) – AdMeld
• Mass media (reach inventory) – AdWords, DoubleClick Exchange, and Invite Media
• Audience targeting (demography, location, etc.) – Can work with search, premium, or mass media
• Behavioural targeting (recorded user actions) – Can also work with search, premium, or mass media
• Mobile ads (served to apps and web pages) – AdMob is a leading global player

The real key behind this revolution is data. Google has deployed a virtual armada of data collection points. Not only does Google know what you have been searching for, but now Chrome knows what pages you have been to, what you buy, and what media you consume. Combine that with DoubleClick and Google understands your paths to purchase. Latitude, Google Maps, Chrome, and Android know where you are. Gmail knows who you know. Google Analytics gives a deeper picture of conversion events.

I am not trying to be a scaremonger, but I think this is great for the marketing industry. It may make regulatory bodies tremble and well-informed consumers militant, but ultimately it’s only about selling things. Our whole lives revolve around either buying things or selling things. I am fascinated at how this new set of tools will be deployed and how they will be used.

Google is in the platform business now. The DSP (demand-side platform) is an amazing concept. A market place of display media market places. Where working through either existing exchanges or private custom exchanges, agencies can conduct their display business with greater economy and accuracy. It also allows uniform retargeting across enormous reach and diverse inventory.

Let’s say that through a combination of Chrome page visits and DoubleClick Spotlight tags, Google has identified you as a person in a particular point in a buying cycle for a ‘high-ticket’ purchase. Let’s say that they can define the radius of your potential travel to buy the item from analysis of your location data. Let’s say they also know your media preferences and advertising interaction history. How valuable is this information to the retailer of that expensive item?

Now AdMeld is not a DSP, it’s an SSP (supply-side platform). It has premium ad space and none of the bumps and warts that an ad exchange suffers from. This may be crucial in the media buyer ‘comfort factor’ stakes as the display ad market transitions from ‘placement’-based buying to an ‘audience’-based model.

Google has the display media market staked out. The two most exciting display venues emerging (being mobile and video) Google has a major seat at the game with AdMob, Android, and YouTube. It has DART (a major ad serving infrastructure) being used by sites and advertisers. It has the performance-end covered with Invite Media, search, and the Google Display Network. AdMeld would provide nicely for the premium end of the market.

AdMeld also comes along with an existing roster of high-end sites and a working real-time bidding technology (something rumoured to be eluding Google’s engineers).

My first thought when I mapped all this out (see below) was, “what will Google do in the DMP (data management platform) market?” I am not convinced it has to do anything. It’s emerging as one of the most formidable data sources in the world already. The display ad market allows Google to reach out to people who are not reaching out to them. It’s a new age!

I am not looking to be provocative but I am sick to death of “Content is King” accepted as fact. I beg to differ; I believe that the Audience is King. So much so, that people will bring their content to your audience for a share of the money your audience is worth.

When we buy ads on a particular type of content, we do so to find an audience we have decided (through research or less scientific means) we wish to target. Content is a means to an end, helping us find audiences to market to.

Although social media has certainly made this relationship between content and audience clearer, on the Internet this has long been the case. We have had webmail and other “applications” on the web virtually forever. They are not content, but they have audiences and people have paid to advertise on them since the beginning of web marketing.

You have Facebook (and MySpace before it) that are just applications. People, the audience, are the content. The content quality argument, suitability of environment, and many other factors we think of when we select destinations for our advertising are out the window. If we can harness the audience, the site’s content becomes as irrelevant as content is on Facebook or webmail.

You can buy content. If you have the audience, you can get the content you need on a revenue share basis. There are content exchanges like Mochila that help content find audiences. Marketers now look to social media for distribution of their advertising content. Content may not attract an audience but the value of an audience transcends the content.

People will bring their content to the party. Blog sites, YouTube, Flickr, even Facebook and Twitter are places people bring their content. People who resonate with this content via social or interest groups gain exposure to the content and the content builds within itself an inherent suitability of propose. Even if the production quality is very low or the topic is questionable, it is right for the consuming audience.

Display advertising is in a state of monumental change. As we see the rise of the trading desk, the DSP (demand-side platform), and the DMP (data management platform). The relationship between audience and content is up for serious review. If we can buy the audience we want to on a real-time bidding basis then content takes a back seat.

I am not talking about what blind ad networks were doing for years. I am not talking about contextual targeting and behavioural derivatives thereof. The day is coming very soon (even in Asia) when we can buy our own customer databases or other third-party databases for display ads and not just email. We can find our targets via the uber-reach of the DMPs and hit them with an emotive video ad while we ruthlessly control the frequency.

The future of content is just a question…brand-safe? Or not brand-safe? Every other factor could become irrelevant for a lot of marketers. Like the content-neutral environments of webmail and social networks, we may just see a de-emphasis of the importance of a page’s contents.

The short-term future (at least) belongs to the audience. Most online display companies are betting heavily on that fact. Publishers are already feeling the effects in some markets and the storm clouds are gathering. Bring on the rain!

For anyone who has worked with online banner ads as a medium for a long time, there are things that we think we know about banners. We see the patterns emerge over and over but we can’t actually prove things categorically. I believe a recent campaign at the ad network I work for took a step closer to proving that banner ads have a significant and measurable effect on brand and product awareness.

To give you a bit of background, the client is Tourism Fiji (the beautiful tropical island), the agency is PMA Communications Group, and the execution was standard banner units. The sites for the campaign were selected using comScore behavioural analysis and the target market was the U.S., even though the campaign was booked in Sydney, Australia.

The campaign employed the standard banner measurements of impressions and clicks and these numbers were solid but not overly remarkable. What made the campaign break out was using social media monitoring to measure the level of discussion and interest around the brand. For this reporting, we used Statsit, a leading regional social media monitoring and insights company. For the purpose of the measurement, only forum and blog mentions were measured. We disregarded data from Twitter, as we did not consider it substantial in reflecting online awareness for the purposes of this campaign.

The campaign began in July 2010 and had a number of bursts before ending in October 2010. No TV ads or significant other mass marketing was run concurrently with the banner campaign.

Here are our key findings:

Banner ads create awareness evidenced in social media discussion. By the end of the campaign, the blog mentions and forum entries talking about Fiji were up 110 percent over the established baseline.

The awareness created was lasting. The level of discussion did not immediately fall back to its previous range once the impressions were reduced or stopped.

The awareness created was compounded. As the impression levels increased, so did the awareness. The awareness grew in a compound fashion building on the awareness levels of earlier impressions.

There is a time lag between impressions and online discussion. We can see a clear time lag between the spikes in the impressions and the corresponding increases in awareness. Interestingly, these lags seem to lessen as the compounding effect takes place.

I have included the graph showing the dates with the corresponding number of banner ad impressions run over those dates and the number of online blog and forum posts including the word ‘Fiji’.

Summary

We can see that this campaign strongly suggests there is a direct and measurable correlation between banner ads and an increase in substantial online discussion. We can see the relationship between volume increases in banners and the effect that has on awareness. We can also see that the awareness does not immediately fall away when the ad volume decreases and that awareness has a compounded effect.

However exciting this may be, I am not going to claim a complete victory yet. We intend to run further campaigns with measured exposure to the banner ad being an additional variable. Hopefully we can have a compelling update soon.

In the 1990s, the Internet banner ad was a marketing revolution. We could not only measure the size of the audience that saw our ads but we had a real-time (or near real-time) feedback mechanism in the click-through rate (CTR).

We loved clicks; the click was one of the cornerstones of the whole industry.

We have grown up as an industry a bit since the 1990s. We are now interested in unique users and not just impression numbers and we are far less jejune about the measurability of online ads. However, we are still hooked on CTR. In a world where an acceptable ratio is 1 click in 1,000 impressions, can we even call the banner ad a direct response vehicle anymore? The question begs to be asked that if people are not clicking, are these ads having any effect?

I recently presented some research at SES in Hong Kong that was conducted in Europe by comScore in collaboration with the ad network where I work. It suggested that the direct result of banner advertising was an increase in website visits for the advertiser and an increase in branded search queries for the advertiser’s brand.

If I take the fairly unscientific approach of looking at my own behaviour, I click on banners (for more than professional curiosity) but even more often, I will make a mental note to have look at a website later.

This research suggests that I am not alone. It seems many (most) other people also make a mental note to visit the site later or search for the brand or offer at a time that suits them.

Another key issue this research raises is that 84 percent of Web users never click on banners. Of the 16 percent of Web users that do click on banner ads, the top 4 percent produce 67 percent of all clicks. Simply put, most banner clicking activity comes from 4 percent of the online population and the vast majority of Web users never click on banners.

Ouch!

We are either holding ourselves to or being held to a performance metric that reflects our ability to elicit a response from only 4 to 16 percent of online users. While at the same time we ignore any performance metrics for 84 percent of the online audience. This just can’t be right!

What may be of more concern is the practice of campaign optimisation based on the CTR. A common practice is to optimise banner campaigns to sites or banners that are giving the highest CTR. If the comScore/FOX research is correct then we are targeting our ads to appeal to a small minority that may not be too choosey as to what they click on. At best we are orienting our campaigns to a loud minority.

ComScore has run similar research in the U.S. with similar results. If this is happening in the world’s other main markets we can safely assume that something similar is happening in Asia.

Making a change is not so simple. A little knowledge is a dangerous thing and sadly a little knowledge of online advertising is pretty common. It takes bravery to go into a client and say that we will now disregard the main currency we have been basing their investments on for the past decade or more.

One solution might be to bring other things to the table for reporting that are more compelling. Social media listening has a certain ‘shock and awe’ value and combined with other information such as organic search data or the volume of cookied visitors on the site from the ad campaign. We may start weaning clients off CTR.

We must start educating the market about the real uses of the banner ad. What is it, what it does, and why we should invest money in them as a part of our campaigns.

A banner ad, when properly applied, can lay a controlled frequency on a targeted audience at a low cost to raise awareness and drive desire for the product. With main performance indicators being the increase in cookied visitors to the website and an increase in branded search queries.

Call me a dreamer, but I would like to put the CTR to rest for good.

Word of mouth marketing may end up being the thing that launched a thousand start-ups. It seems from chatting with people that there is a strategy to create “viral” campaigns. This is kind of crazy. It is a bit like setting out to make a “cult” movie. A campaign, like a movie only gets cult status or goes viral rarely and a number of factors all have to come together to make that happen.

I was having a conversation with one of my new colleagues (I just started work at FOX) about social media marketing and the difficulty of getting users to support your stories & initiatives. The trick is not to have to create highly viral content of your own but to be able to find and hijack existing social media chatter. A social media Trojan Horse.

OK. That sounds good but how do you do this in practice?

Firstly you are going to have to find content that is suitable to serve as the host for your message. This content (perhaps more than one) should have people linking to it and should have a “comments box” for you to add in your story.

Obviously the content should be relevant exactly to what you are going to offer. Random comments on peoples postings will be construed (quite rightly) as spam. If you are contributing to the ongoing dialogue in a meaningful way you are present in the dialogue and you are doing what social media marketers should be doing.

Once you have found the suitable story and found the comment box you should remember to add in your URL of what you want to promote along with the copy that will inspire the users to go and read it.

This technique can be used with blogs, with news stories (with social feedback) and with social media sites like Digg or Facebook. This will also take Social Media Monitoring to apply broadly.

Enjoy

Its been a bit of a rough time for a few brands recently. They have among the first brands to have tasted the lash of the mob and seen the power of Social Media to move negative branding rapidly to large audiences. 

I first saw this story “An Unwelcome Deliery” about the problems Domino’s Pizza have been having from UGC in Newsweek at the airport this week. It took Domino’s a few days to see this video turn up on YouTube and by that time over a million views of the video had been recorded. 

Then Apple gets hit. I had been following some threads about the Nine Inch Nails and their fight to get an iPhone app on iTunes because of some curse words. But then the very odd selection criteria applied by Apple OK an app where you shake a baby to death for sale . 

The backlash against Apple happened rapidly. Leading to TV and Newspaper coverage and demonstrations outside Apple stores. 

BusinessWeek have some recommendations on how companies prepare themselves against these types of problems. Number one on their list is Monitoring. 

I could not agree more.

All of the UGC pundits that I am following are (at least in part) mourning the death of advertising. Much of what they say makes sense and marketers who can see the social-path and make changes now will benefit greatly. However I think that (particularly here in Asia when banner-ads still rule the roost) advertising has a long way to go before the gig is up.

An article posted recently by the venerable e-marketer entitled “Does Anyone Trust the Media?” listed the most trusted news source is friends. They have Asia Pacific data in this report. For South East Asia with some similar restrictions on the mainstream press the China data from e-marketer report may have a closer relationship than a European or US model. UGC platforms like Facebook.com are making the sharing of brand-related information amongst friends easier and more and more common.

In a separate report e-marketer talk about the propensity of the users to take action based on varying online ad formats, including UGC. The article entitled “Brand Mentions Preferred over Ads” finds that online articles that mention a brand are 100% more likely to lead to an action than a banner-ad and marginally ahead of email marketing.

UGC will be embraced by brands. There is no doubt in my mind about this. Like PR, UGC has the allure of being a free (or at the very least highly cost effective) form or marketing. What the brands are not really taking on board it that there has been a very large behavioural shift in product research. Now web-users not only research purchases online but they are increasingly researching from social sources. Getting ads close to these sources will likely get harder and less appropriate.

Just like in US TV where the DVR has reduced the effectiveness of TV commercials and a new approach to TV ad formats must be envisioned. We will have to think about the changing standing of online display ads and their role in pushing the brand message forward.

In an earlier post, I talked about the Holy Trinity of Social Media and User Generated Content (UGC). The first step in the responsible handling of UGC is Observation. An observation platform helps you see the UGC surrounding your brand. Without the right optics, you can’t see the threats or the opportunities in time to have a suitable effect on their outcome. 

When we observe UGC, we can see differing reactions to the stories posted. We need to make a decision whether the content is repeatable or not. Clearly some stories regardless of how big the buzz was you have no intention of rekindling. There are also a number of reasons that the content of the posts may not be repeatable, these range from vagueness to spreading the wrong message about the brand. 

If we feel that the content is repeatable then we next look to the reaction type to predict the value of the content to us. There are a number of differing types of social reactions that we can observe. These include blogs & articles linking to a piece of content, “Social Bookmarking” of the content or passing a URL in Twitter. 

The benefit to us varies based on the reaction type and our goals for the brand. This is partially where “Organic Search” (SEO) and UGC can co-exist. Where a link to your website URL has been passed in one of these social media transactions you see an SEO benefit in the form of a “Backlink”. 

Firstly, there are two types of posts we should focus on. One are our posts on your domain (press releases, blogs, etc) the other are stories written by others and not on your domain. The latter is less likely to create a direct backlink for SEO unless they carry a link to your domain. However links not contributing to SEO can still make up positive buzz around the brand. 

Where we have observed past positive social reactions to particular types of content and we feel it is repeatable, the next step is to produce content of our own in the same vein. 

The step after that is to distribute the content. I will cover distribution in a whole post of its own as it deserves to be treated as a topic in it own right. 

The final step is to monitor the reaction and see how your content was received in comparison to the similar content that you emulated. 

With an eye on what the mob will respond to, marketers can look for opportunities in the brand buzz to find areas of content that can be expanded on to further the objectives of their brand. I think this approach is far preferable to the random dissemination of brand information we often see now.

Lets face it, the world is a bit of a mess right now. Social media and User Generated Content (UGC) are growing concerns for those in the marketing world. Those who have been aware of the threats anyway.

In a case of life imitating art, we can see the empowerment of the end-user through giving the common man access to a potent broadcast medium. This has lead to a problem even that brands that are aware of the problem, have not yet worked out how to answer.

The world out there in the realm of UGC is not a bunch of sane, rational and sober people exchanging intelligent witty views on wine and restaurants. It is more like a lynch mob with pitchforks and flaming torches waiting to jump on the revolutionary bandwagon and cut down all the tall poppies.

Within the mob, there can be agitators. As the Internet is available to the general public we can not guarantee the sobriety or mental health of the users who may wish to comment on your brand. The agitators may or may not be completely nuts.

UGC gives these people a super-powered Soap-Box from which they can air their views. To make matters worse,  research is telling us that online comments are taken as truth by the vast majority of web users. So if these comments are close to your online transaction points or if they hit a large enough audience, then the results could be devastating.

When I was at law school we referred to the average man as “the man on the Clapham onmibus” to test for reasonableness. Whether our UGC man is average or not, he can cause so much trouble that a brand may be pushed into crisis mode repairing the damage.

Never before has the lone common man had the ability cause so much trouble.

Online points of transaction (Or even points close to transaction) are particularly vulnerable. These are points at which online business is actually transacted or where key decisions are made on the way to transaction. If we take Travel as an example then points of transaction may be flight or hotel booking sites and comparison shopping sites. Points close to the transaction would be review sites or destination information sites.

Don’t think that if you do not transact online that you get off scott-free. Brands regardless of their transaction points can still be held hostage. Just because your transaction points are offline does not mean that you are not exposed to the mob.

It is important to not take this as all being negative. The medium of UGC offers a great deal of upside but its dangers are not to be ignored and contingency plans for a variety of possible threats should be at least considered. As with earlier movements that took us closer to the customer (Database marketing and email marketing specifically) there are brand related risks and things to learn to avoid.

So I guess we all have to get our thinking caps on and think of how this affects our brand and the exposure our brands actually have. Then make some disaster plans and keep an ear to the ground.