Let the Advertising Revolution begin!


Paying *only when you get results* is an advertisers dream, and it’s been largely unattainable because it’s so hard to track the true performance of conventional media. Enter the internet age where you can track performance, and now enter Google, with a huge stable of advertisers who will soon be able to use their amazing analytics and advertising tools to do just that.

NYT Summary of Google’s new gig | TechCrunch on Google’s new gig 

Google’s pay per performance is NOT a new idea, but it will probably be the first globally significant application of that idea.

Predictions? I think advertisers are going to quickly learn that the advertising emperors have far fewer clothes than they’d thought, and that all but a few great campaigns have positive ROI. Big advertisers have to date been largely incompetent with math, foolishly trusting big agencies who do self serving ROI calculations. This will change, and it’ll be a revolution in advertising.

Travelers Advantage is a Traveler’s DIS advantage


It should be called Traveler’s DisAdvantage

I’ve had really bad results with Travelers Advantage over many years of membership. The only reason I stick with this horrible service are the “bribe” rebate coupons they send each year when I threaten to cancel. These roughly cover the cost of this horrible travel service but it’s time to get rid of it. I think the “hotels at half price” may still be about the same as online pricing if you have the time to mess with it and make a lot of calls but their call in reservations system is scandalously expensive given that you are *paying them* to find deals. I’d like a *single example* of TA beating Hotwire pricing for comparable hotels or a few examples of them beating out a Kayak.com hotel search.

Example: Booking for a specific Days Inn in CA today I was getting many different rates. I called TA and asked them to match the online price. Nope, they said, and suggested deceitfully that they were using “real time” rates and probably I could not get the lower rate. Travelers Advantage had $75 plus taxes where my initial search gave me $67 including taxes. I pulled up their “low price guarantee” and read it to the customer servicer who just kept insisting on the high rate. Although it’s possible they would have eventually refunded the difference I’ve seen such “guarantees” before and they often try to take advantage of loopholes and BS. I didn’t want to book and then hope to get justice months later.

So… back to Days Inn website which had even lower rates than earlier (or I missed an option there), so I went ahead and booked at 204+tax for the 4 nights vs the 300+tax I would have paid Travelers disAdvantage.

But here’s the funny part: After I booked at Days a chat box came up saying ‘hey, would you like to save $30 on today’s reservation? Sure I said. Up came this: “JOIN TRAVELER’S ADVANTAGE!”

I explained I’d already joined and they gave me a higher rate than I’d got -literally- one second ago from this website and asked why.

She never answered me, just disconnected. Sad, but at least I got my good rate in spite of all the wasted time with 1) My existing Travelers Advantage Membership and 2) Another prospective Travelers Advantage Membership.

PT Barnum would be proud of you, Travelers disAdvantage, because you, like he, act on the knowledge that a sucker is born every minute.

Viacom “Austin Powers” to Google: We want ONE BILLION DOLLARS!


Viacom has sued Google/YouTube for copyright infringement, filing papers today and asking for a billion bucks in damages. The Viacom Press release summarizes their point of view. In short Viacom says of YouTube:

Their business model, which is based on building traffic and selling advertising off of unlicensed content, is clearly illegal and is in obvious conflict with copyright laws.

Here’s the Reuters Story

Mark Cuban warned about this type of legal challenge overwhelming the YouTube deal several months ago.  Here’s his take on the latest news.   It seems possible Google may wind up regretting their purchase of YouTube, proving to be a hornets nest of potential litigation that seems to be increasingly expensive. This while it remains unclear how well YouTube content can be monetized, to the extent there is much left after all this litigation. Google allocated about 400 million of the 1.65 billion purchase price to settle these claims but if the Viacom lawsuit it any indication it may get more expensive than that.

Ultimately I’m guessing it’ll be judges reaction to the new ethos surrounding IP law. Onliners big and small routinely disregard many longstanding content distribution rules so judges may decide that the legal issues have become so universally murky that they’ll start ruling in favor of the new media distributors like YouTube/Google, though I’m guessing the first sets of judgements will seek to penalize them in the name of respecting existing copyright laws. The swirl of legal challenges to YouTube content may be a case where Google’s freewheeling, usually innovative approaches come back to bite them, but it’s too early to know.

Brain scans yield key first step to … reading your mind.


A provocative experiment in Germany raises questions about the future of keeping our thoughts private and even free will itself.   Researchers have been able to predict, with modest accuracy, the *intention* of a person to complete a mental task.     Predicting physical actions with brain activity has been done before but this appears to be the first example of predicting mental activity from brain activity as measured by MRI.

Here’s the story

The implications are significant both philisophically and in practical terms.    What exactly is “free will”?   If our decisions are effectively made *before* we actively process the information then what exactly is in control of our thoughts and actions?      If your future “decisions” are simply a product of a bunch of your past thoughts and behaviors then you may be a lot more predictable than you think.

From a practical side this could make for a marketing dream world (or nightmare world?), where persuaders in advertising or politics would tailor the message to your specific brain activity, or even try to “short circuit” activity in their favor.

Hmmm – I suddenly feel compelled to vote Ray Kurzweil for president …

Global community spirit


Over at Techmeme I’m struck by three stories that nicely showcase the importance of *community* to dot commers and to the expanding online universe.

The most interesting is that Yahoo Answers is going social, offering social networking as part of the answers concept.  I was bullish on Yahoo Answers a year ago and it appears they’ve done a great job at growing this project.   Incredibly the number of answers users is comparable to the number of Myspace people. This is not entirely apples to apples comparison because I’m guessing the Myspacers spend a lot more time online at Myspace, but if Answers can get the community ball rolling there is huge potential to become something of a “thinking persons” (or at least a “questioning person’s”?) Myspace.

The second item is Kevin Rose reporting that Digg has a *million* users. That is quite a milestone (though a long way from the approximately 60-100 million users claimed by Yahoo Answers and Myspace. I’ve never really understood the appeal of Digg as more than a superficial way to identify oddball news, feeling that dedicated diggers tend to prefer goofy stories rather than substantive ones, but the concept is brilliant and provocative.

Third, and perhaps most significant, is SONY’s Playstation 3 virtual world that launches this spring. Critics are raving about SONY’s brave new world, some suggesting it’s superior to the top virtual world “Second Life” which suffers from technical complexity, a steep learning curve, and a lot of skeptics who think second lifers are just escaping their first lives. It seems to me the Playstation world could become the “Myspace” of virtual worlds and captivate the teen crowd that already is practically living online ( WI or XBOX could also get smart super fast and get their own virtual world going. Both appear to be on the road for more widespread adoption as gaming systems than Sony’s PS3, though this can all change quickly).

Alexa – Beware the Satanic Statistics?


Peter Norvig over at Google has published a quick little study indicating how unreliable the Alexa Metrics are if you want to know about website traffic. Thank you Matt for pointing out this Peter paper, which is very intriguing as it demonstrates that Alexa is off by a factor of 50x (ie an error of five thousand percent!) when comparing Matt Cutts’ and Peter’s site traffic.

I’ve realized the problems with Alexa for some time based on Alexa comparisons to sites where I knew the real traffic, but 50x is a rather spectacular level of error. So great in fact, given that these sites are both read mostly by technology sector folks, it suggests that Alexa is effectively worthless as a comparison tool unless there is abundant other data to support the comparison, in which case you don’t need Alexa anyway.

Of course the very expensive statistics services don’t fare all that well either. A recent, larger, and simply superb comparison study by Rand over at SEOMOZ collected data from several prominent sites in technology, including Matt Cutts’ blog, and concluded that no metrics were reasonably in line with the actual log files. Rand notes that he examined only about 25 blogs so the sample was somewhat small and targeted, but he concludes:

Based on the evidence we’ve gathered here, it’s safe to say that no external metric, traffic prediction service or ranking system available on the web today provides any accuracy when compared with real numbers.

It’s interesting how problematic it’s been to accurately compare what is arguably the most important aspect of internet traffic – simple site visits and pageviews. Hopefully as data becomes more widely circulated and more studies like these are done we may be able to create some tools that allow quick comparisons. Google Analytics is coming into widespread use but Rand told me at a conference that even that “internal metrics” tool seemed to have several problems when compared with log files. My experience with Analytics has been superficial but seems to line up with my log stats well.

USA Today goes social – good for USA Today and good for US


Props to USA Today for going social with their online edition, now complete with blogs, comments profiles, and more.  Here’s the USA Today explanation.

I just set up a profile and it was fairly easy, though it’ll sure be nice when this type of information is portable and one click will sign you up for such things.

Tech folks are currently wrapped up in fairly obscure and/or proprietary issues about how transferable ID information will best move around the web and I hope this gets resolved soon.

Also it’s getting ridiculous to set up a new blog at every Tom, Dick, Harry, and USAToday site you want to post at rather than do what Facebook has done which is allow you to bring your own blog content into Facebook effortlessly. This allows them the benefits of your content without forcing the user to post at several different places.

I should also say that although I’m glad “old” media like USA Today is “getting” the social networks part of the Web 2.0 online revolution, I’m rooting for “pure” online news sites like NewsVine and TechMeme because I think they do a better job of democritizing the news process than legacy media can ever do. In fact I learned about the USA Today changes from Techmeme since I’m not a regular USA Today reader.

Steve Rubel as a nice post about the social networking implications of USA Today’s changes while Matthew Ingram‘s wondering if mom and pop really even care about this stuff.

Sex, lies, videotape, and Wikipedia


Wikipedia‘s latest mini scandal involves an editor “essjay”, real name Ryan Jordan, who faked some academic credentials both in his Wikipedia work and in an interview with New York Magazine. After considerable debate over the issue Jordan has resigned from his (high level) volunteer Wikipedia work and his new, paid position at Wikia.

New York Magazine conspicuously failed to find the deception in their fact checking, leading some critics to suggest this episode is best seen as an example of how mainstream media fails to get the story right even while complaining about internet inaccuracies. Others focus on this as yet another example of how the internet space is filled with deception, even in what is arguably the most authoritative encyclopedia ever developed – Wikipedia. A recent study compared the accuracy of Encyclopedia Britannica to Wikipedia and concluded they were roughly equivalent in accuracy. Wikipedia’s much greater depth of coverage means that it “wins” in my book, and I noted the other day that I have not cracked open any of the volumes of my Encyclopedia Brittanica in years.

Nicholas Carr has a thoughtful post about the mini-wiki-scandal. Unfortunately I think many other onliners reflecting on this the analysis, including founder Jimmy Wales, are talking the point of view of “insiders” who are very sympathetic about the nuances of how online identities and anonymity have become accepted aspects – some would say necessary parts – of the online experience.

Active Wikipedia folks seem to have nothing but glowing praise for Jordan’s substantial contributions to the project and don’t seem very interested in the deception issues, which itself is very interesting since Wikipedia prides itself on seeking unvarnished intellectual integrity. Apparently insiders are allowed quite a bit of varnish? Where will these people draw the lines on truth? A very slippery slope in my opinion, and in general I object to the notion that anonymity serves the community well – on the contrary it’s generally harmful and unnecessary and in cases like this provides detractors with a lot of ammunition to shoot down the idea that the wisdom of crowds is superior to the wisdom of “experts”.

This despite the fact you could suggest that what is remarkable here is that Wikipedia is so very accurate *in spite of* the many deceptions. This suggests that accuracy can spring from the wisdom of the crowds even when that crowd may be engaging – at an individual level – in deceptive behavior.

I think mom, pop, and most outsiders will view this in simpler terms and see it as yet another indication that “the internet can’t be trusted”. This is unfortunate because 1) the right decision was made here – Jordan resigned. 2) Wiki is very authoritative in many areas. Like many onliners I turn first to Wikipedia for many research topics, always cautious about accepting it as the last word but generally pleased at how well it stands up for many topics as a quick and accurate introduction.

I love Wikipedia as an info source but think the “moral” of this story is that the new web ethic – one that suggests it’s fine to practice various forms of personal deception as long as you don’t send spam emails or bother other online insiders, is very misplaced. I strongly get the idea from Wales and others that “being part of the team” is more important than being straightforward. I see this ethic in some of the activity I’ve observed in Silicon Valley as well. As an “insider” at conferences folks will share information about all kinds of deceptive stuff they’ve done online. The extension of these new Web 2.0 ethical standard creates a world of hidden identities, personal deceptions, and many avenues for illegal and unethical online activity.

As for me I’d just like the old conventional handshake and honest talk morality back, and make that ASAP if you please.

Microsoft to move almost all ads online over next three years. It’s about … time!


I’ve been wondering how long it would take for the big players to shift the big money online, and it looks like Microsoft is heading powerfully in that direction based on this story from Media Daily News.

I’m not sure Microsoft is really a bellweather for corporate ads as MS is a technology company that does a huge amount of business online and has a huge online customer base, but whenever close to a  billion dollars is shifted from conventional media to online it’s a significant development in the advertising landscape and probably an indicator of things to come from other major advertisers.Since I did several conversion studies many years ago in the travel sector it’s been clear to me where things were headed as these strongly indicated that online advertising is far more effective than print ads.   As an online marketing guy for Oregon travel projects we ran full page Sunset ads featuring huge displays of separate domain names that I assigned specifically to each campaign.    This made tracking easy and also kept users from having to type in long, cumbersome URL strings.  Despite this we saw very modest traffic increases from major print exposure.    A 20,000 full page print ad would only yield a few thousand extra website visits over the next month.   Initially this came as a shock to me but after dozens of experiments in many magazines, and an examination of other print advertising campaigns, it became clear that it’s foolish to try to drive web traffic using print.   Although we did not run any signifiant TV or Radio campaigns I examined some data from Texas’ Travel web efforts and concluded that TV was also a prohibitively expensive way to drive web traffic.    Online methods generally outperformed offline by a factor of perhaps 10x, and this advantage does not seem much less today.

Yet there is a type of momentum that comes from human stubborness that keeps TV, print, and radio advertising over-funded even as conversion studies are now abundant indicating the superiority of online advertising.   Recently I think it was Ford that decided to increase the online spend considerably, though I think this news from Microsoft is the first time a major advertiser has chosen to move most of their spend to online venues.

Eventually online costs may catch up to conventional media in terms of ROI, but I think this is not the case yet.    That’s not to say that positive ROI in online ad campaigns is a simple process – it is not and many millions are squandered in bad online campaigns.  But this pales in comparison to the *billions* that are squandered every month on ineffective offline media campaigns.   The offline advertising Emperor has very few clothes, but few will notice until people start doing quality mathematical analyses of advertising campaigns and stop listening to self-serving research.    I’m not holding my breath for that.

Social networks = people, not technologies


The New York Times reports that Cisco has acquired Tribe Networks in what appears to be an effort to become a player in the social networking space.     The article quotes Marc Andreeson of NING, another social network facilitator, suggesting that the social networking biz is harder than it looks and Cisco will have problems.    I agree Cisco will probably fail to do much with this but not for the same reason, but for the opposite.   As with most internet stuff the technology difficulties are much less of a challenge than the social barriers to success.

Even Yahoo and Google – now brilliant masterpieces of technological sophistication – did not start out that way.     Rather they began as fairly modest “websites” with a handful of programming routines  that grew in usefulness, traffic, and complexity to become the internet behemoths they are today.   Sure there’s a lot of amazing technology behind these companies, but I still think there is a sort of “techno bias” that remains pervasive both inside and outside the industy that is both fooling and manipulating people into thinking that success is mostly a function of your technology when it should be clear to all that it’s a function of the way your online environments relate to people, and that in turn is art not science.    Is expensive, complex technology required to create a hugely popular, high traffic website?   Of course NOT.   Myspace and Facebook now use slick stuff, but they didn’t start out that way.   PlentyofFish.com, a hugely popular dating site, still uses a *single* server and very basic technology despite the fact that it competes with big players working on platforms that probably cost 100x that of PlentyofFish’s.

I think the future will be like the past – successful sites will cater to the needs of people and bend the technologies as needed.   Cisco, Ning, and other social networking technology platforms are great but they won’t define things.   People will do that.   People are, after all, what social networking is all about.