Grouper is notable in that, like One True Media, it offers web-based video editing.
From what I can tell Friendster's not pushing the video editing angle, but more the uploading and sharing angle.
This is good for a start but dumb for the long term because promoting that angle could help friendster keep pace with MySpace by positioning themselves as more of a creative collaborator.
Anyways, nice work Friendster, and it makes me wonder if MySpace is whitelabeling someone for video... Not really sure how to tell. Garrett French - MarketSmart Interactive
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Zixxo Follow Up: Funding Thus Far, a Coupon's Nature, Penetrating Local
I had a few more questions for Mike Hogan following my posting of the Zixxo interview.
Mike, I'm still not convinced that your affiliate and API strategy is going to drive penetration rapidly, but I guess if Zixxo figures out a partnership model for Merchant Circle, and others serving local business folk we'll see significant penetration for you.
My hold up in thinking you'll see a growth spike lies essentially in the fact that people still use the print yellow pages so much. I don't have solid data, just Sterling's anecdote about print yellow page usage in a Microsoft reception area.
I think you're in a slow-burn space, which is not a bad thing at all, and I'm confident that you *will* see growth.
You would certainly see a spike however if any of your upcoming partnerships happen to be with companies whose names start with a G or a Y.
Anyways, I hope my upcoming interview with a Yellow Pages exec will give me and my SEL readers a better idea of those folks who still reach for print when seeking phone numbers.
Here are Hogan's answers, and Mike thanks again for your quick response!
How have you paid yourself and your team for the last three years? We've been earning sweat equity… not much cash, lots of sweat. Three of our developers work other jobs, so we have largely paid them in equity. Despite their other jobs, they put in 40+ hours a week each. The remaining team has worked some outside consulting to keep the revenue flowing, actually trickling.
What is the nature of a coupon? A coupon is a promotional offer that a business provides to customers in order to encourage behavior that is favorable to the business. The key to success is to determine (a) Your business objective, what you want to achieve; (b) What you can offer that sufficiently "rewards" the customer.
What is it transactionally? In terms of the transaction, the business offers the customer some value to encourage certain behavior and the customer trades that behavior for the value in question.
When does it work? A coupon works when there is a fair trade between the value offered and the behavior that is rewarded. For example, if the average customer purchases $50 worth of product from me, and my gross margin is 50%, I might offer $10 off of purchases of $100 or more. Essentially I am trading a discount in return for larger purchases. But my business benefits because I pay $10 to get $25 in additional profits (50% of the additional $50). So my business grows its profits by $15 per coupon using customer, and each customer gets a $10 discount. In addition to growing my profits, I may attract more customers who want to take advantage of the deal.
When does it not work? Coupons don't work if they don't clearly convey to the consumer the behavior you wish to encourage. For example, an early Internet company negotiated discounts from vendors and then discounted the savings, unbeknownst to the consumer, at the credit card company. In essence the business paid a discount that was "invisible" to the user. Because it was invisible, it didn't drive any consumer behavior. Needless to say, it didn't work. In fact, it prompted me to write this article "Coupons: More than just a discount."
Who should have coupons who don't use them now? Everyone! The key is figuring out what behavior you want to encourage and what you are willing to offer in exchange for that behavior.
What are coupon creation best practices? (1) Use ZiXXo
(2) Make a fair offer of value in exchange for favorable behavior
(3) Define an end date (eternal coupons can really haunt you)
(4) Determine whether the deal is a one-time offer only or you want them to get the same deal every time. We offer "limited use" coupons to encourage 1-time behavior (for example some restaurants offer a 1-time only coupon to get people to try their food. The second time, they must pay full price.)
(5) Put as much information into ZiXXo as possible (selling points, locations, hours of operation, payments accepted, even menus). You want to sell value, not simply price.
Users can search by coupon ratings - how will you prevent sellers from voting for themselves? We won't. In order to rate coupons—and get the limited use coupons—the user must be registered and logged in. We do email validation for registration. So we assume that sellers will rate themselves highly, once, but with large numbers of users, that will balance itself out.
How do you incent ratings and votes by users? We're still thinking about this.
I've seen success with social systems like Yelp, Judy's Book, and others. These folks reward users with social recognition from their peers for reviewing vendors.
In reality, we're not sure how much people will use our native ratings, because our goal is to syndicate the coupons to sites like Yelp, Judy's Book and everywhere else. So the actual consumers may never see or use our ratings, they may use their native ratings and reviews.
Hopefully, some day someone will provide a ratings system that spans all of these sites and ours.
How can an API/affiliate strategy really give you the penetration you need in the local market place? Our API/affiliate model encourages everyone to operate in their own self-interests.
Let me give you an example: A yellow pages company sells a quarter page ad for let's say $1,000 per month. The merchant has no idea whether it works though. How can they track its success?
The yellow pages company then sells the same merchant a premium listing in an online yellow pages for $50 per month. Now they can show how many clicks and page views that merchant gets. But what is a click or a page view to the local plumber?
Now, assume that same yellow pages company encourages local sales people to include a ZiXXo coupon for a complete advertising solution. Now every day that local plumber gets customers redeeming coupons. The merchant now gets a daily affirmation that their advertising is working! Those 50¢ coupons reinforce $1,050 in monthly advertising spend with that yellow pages vendor.
In reality, those coupons may be found and printed from Yahoo, AOL, MSN, or any number of other sites, but to the plumber, that yellow pages advertising works. As a result, offline and online advertising companies should be eager to lock-up local businesses for coupons through ZiXXo to reinforce their other advertising.
This is just one example, but by enabling enlightened self-interest, our API/Affiliate strategy can be huge.
Garrett French - MarketSmart Interactive
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June 29, 2006
Naymz Interview: the Online Dating/Orbitz Roots of a Paid Search Identity Management Start-up
(This interview is 3,068 words long and requires about twelve minutes and forty seconds for reading. I'll be creating the minute and a half version when I get back from lunch.)
Naymz launched recently. They offer identity management services for individuals.
For $5 a month (first month free, you can also buy a discounted yearly subscription for $47.50.) users get an ad for searches on their names, a customized ad on MSN, Google and Yahoo, and a customized landing page.
Pretty nifty stuff for the dating set, the online professional and other folks whose names are pretty much their brand.
I had the pleasure of interviewing Tom Drugan, a Naymz co-founder, who went indepth on his background at Orbitz, in the dating industry, and how these experiences informed his newest project and very first start up.
I have to preface this interview with two totally unrelated statements.
1) Drugan's responses are some of the most engaging I've gotten to date. He's a strong writer who's clearly excited about his first start up. And he's very open about his work at Orbitz and how the Naymz teamed formed on the top of the talent pool there.
If he ever removes that account I will immediately replace *this* interview with the *other* article I wrote about Naymz. I don't think I need to say anything more ;)
Without further ado I'm very proud and excited to give you Tom Drugan of Naymz:
You have a strong background in the dating industry. How did your background there help you develop this concept?
For me personally, the Dating Industry is where I cut my teeth in terms of search engine marketing. I starting managing large scale campaigns for Great Expectations Dating Service a few months after AdWords initially launched and GoTo re-branded to Overture.
It wasn’t too long ago that the dating industry was the hottest thing around and I had the fortunate opportunity to work with a very healthy budget.
Naymz may certainly serve a purpose for the dating industry. It’s no secret that the first place that many daters go to is Google to find digital dirt on that Cherish.com or Great Expectations set-up they have for Thursday night.
Naymz would be a great way for daters to be found in the search engines and claim what online content is about them and what isn’t.
We are starting to look to establish partnerships with dating, social networking, career, and any other sites in which Naymz would be a useful tool for their customer base.
We are in the process of building a white-label version of Naymz that would seamlessly integrate into other sites.
what did you learn at Orbitz professionally that you were able to apply to Naymz?
At Orbitz the online marketing team is closely integrated with the product, finance, merchandising, management and branding teams. This really helped us understand all the different pieces and parts of running a large scale online company.
Orbitz (along with sister company CheapTickets) also spends a significant amount of money on search marketing.
Google and Yahoo work closely with Orbitz to help push the envelope in regards to search engine advertising. Orbitz was doing some really cool, cutting edge stuff. Google and Yahoo would also look to Orbitz to test out a lot of efforts.
This allowed us to get a good grasp of how to run large scale PPC campaigns and what the current limits are with the various ad platforms (Adwords, Yahoo Search, AdCenter, etc).
Orbitz hands down has some of the smartest people in the industry, travel and beyond.
Because of this we have received some outstanding feedback and recommendations from our network of colleagues there.
We left Orbitz in good graces and everyone there has been really supportive of our jump into entrepreneur-ville. It also helps that we didn’t start-up a competitive travel site ;-).
where did the concept come from? how did it evolve?
A couple of years I was working on building out a keyword list for one of my clients.
On a whim, I decided to throw my first and last name into an AdWords campaign to see if Google would accept it. To my surprise, the ad I created for myself popped up seconds after posting it.
After pondering the possibilities of this, I decided to get creative with the idea of vanity search results.
I have a friend who happens to have a very attractive younger sister. He also happens to hate when his friends tell him how attractive his younger sister is. I decided to post a sponsored result for his name which had the following copy…
Brian Barnes
Brian has the hottest
sister ever.
www.brianshotsister.com
I sent Brian an anonymous e-mail telling him to go “Google” his name. The ad I posted happened to link to a photo of me with a big grin on my face, so he quickly knew who the culprit was.
Unfortunately, my prank didn’t earn me a date with his sister.
Over the next few days I “punked” a bunch of co-workers and friends with similar ads for their names through AdWords. The ads I put up began to spread virally and I saw the impression and click volume skyrocket for the names I had bid on. That’s when I knew I might be on to something and the wheels began to turn.
The original product plan was called “Gunked.com” which was a mash-up of “Google” and “Punked” ala Ashton Kutcher.
I had wanted to build a site to allow user to place ads for other people’s monikers which would link to Onion-like articles about them. A five minute conversation with an attorney put the kibosh on that concept due to slander and defamation issues. Gunked eventually morphed into Naymz which is far more practical and far less lawsuit prone.
please describe the team forming process... how did you guys find each other at Orbitz? how did you go about forming an actual company? how long did it take?
Soon after I first developed the general product plan I changed jobs and shelved the idea to focus on my new roll at Orbitz.
In May of 2004, a really bright guy in my department by the name of Nolan Bayliss approached me with all these new business ideas he had come up with while in Grad School. While he had some great concepts, they all needed a lot of resources and several million in capital to get off the ground. I happened to also float a few ideas I had conjured up by him.
When I told him about the ability to bid on peoples' names in the search engines, his eyes lit up. He immediately saw the same big picture that I had and came up with tons of different directions that we could take it in which I had never thought of. We eventually just looked at each other, shrugged, and said “Let’s go for it”.
A few weeks later, after writing a brief business plan, we approached Tony Czupryna who was a Sr. Developer at Orbitz and happened to be very familiar with search engine marketing. He was the perfect fit to make this idea come to life. Tony fully understood the business concept and opportunity and shared the same entrepreneurial spirit that Nolan and I did. Tony eventually became our third partner in the new venture.
Over the next eight months we fleshed out a business plan, built a prototype, raised capital, reviewed the idea with our peers, and resigned from very good positions at Orbitz. Shortly after we left, we were contacted by two other Sr. Developers at Orbitz who were very interested in what we were building. After disclosing what Naymz was, they both got excited wanted to help see the idea become a reality. In April we moved forward hired Michele Lopatin and Brian Pontarelli.
They are both incredibly talented and by far our biggest assets.
are you profitable? if not, who's funding you?
Unlike most start-ups, we do have a revenue model coming out of the gates. We generate revenue from premium subscription sign-ups and through advertising. We just launched a few weeks ago (June 9th), so we have a ways to go before we break even. Ideally we would like to get there before end of year. Let’s just say we need A LOT more premium subscription sign-ups before we get there.
We raised our seed capital from friends and family. Depending on how things look in the next few months, we may need to raise additional rounds from angel investors to stay afloat. We also may start dropping our business plan on the doorsteps of VC’s to see if there is any interest there.
may I micro invest in your company? I'd like to put in, say, $1,000. what would you give me in return?
Currently we aren’t looking for any additional investors. For our first round, we had a minimum investment of $50K. It’s TBD if we drop that for future rounds.
Now if you are giving out personal loans, we should have an offline conversation. I could certainly use the cash.
what if I could find 500 more people willing to invest at that level?
We are trying to not have too many cooks in the kitchen. Keeping investors up to speed with everything that is going on and assuring them that they made a good investment takes time and resources. To deal with 500 additional investors would be a whole job in itself. If someone were to approach us with an opportunity like that, the investors would have to be silent and we would want one or two point men/women for communication purposes.
Who are some notable Naymz that have set up accounts thus far (besides me of course ;).
According to our database, George Bush, Britney Spears, and Nacho Libre have all created profiles with Naymz. However, my guess is these aren’t valid profiles ;-).
We’ve only been available to the public for a few weeks, so our reach hasn’t been extensive. Some important industry bloggers have built profiles with us such as Emily Chang of eHub, Andy Beal of MarketingPilgrim.com, Pete Cashmore of Mashable.com, and of course the legend himself Garrett French from searchenginelowdown.com.
What do you think of Merchant Circle - You guys are slightly in competition, though if you get in there quickly there might be some good partnership possibilities...
We’ve definitely been keeping an eye on Merchant Circle. There is also a company here in Chicago called Local Launch (http://www.locallaunch.com/) that has a similar platform to Merchant Circle. I can certainly see some overlap between our offerings in terms of individuals whose names are essentially their brands (Real Estate Agents, Doctors, Attorneys, etc.). Merchant Circle is currently a more comprehensive online marketing solution for small business owners. Naymz is casting a bigger net and offering a tool that can be used by just about anybody.
How do you prevent me from bidding on my company's name?
We know where you live, so don’t do it. We have some super-duper top-secret form validations that we do when new sign-ups come in. We also have a small enough flow of new accounts coming in that we manually review each one. If you were to try and submit a company name, we would take the profile off-line and send you an e-mail asking you to change it.
What if my name is actually, say, Homer Simpson. What happens then?
“Internet! Is that thing still around?” – Homer Simpson
There are inevitably some names we are going to lose money on (clicks cost more than $4.95/month) and other names we are going to have to turn away all together in regards to a premium subscription. It’s the nature of the business model.
We have written in our terms and conditions that we can set budget constrains on certain names which will result in extremely high click counts. This means that the sponsored result may not show for every set of search results over the course of a day. This is certainly the exception, however.
We are going to learn our thresholds as we go and adjust accordingly. In extreme cases we have the right to cancel a subscription and refund the fees if we deem necessary.
We also have a basic (free) membership in which we will add ones profile page to the natural/organic search engine index for Google, Yahoo, etc. We will be more tolerant with basic member’s names since we aren’t bidding for placement.
Who else is on your team - who's in your company?
There are currently five of us who work on Naymz. All of us worked together at Orbitz. Three of us are founders and we have two full-time developers. Nolan Bayliss and I have online marketing and business development backgrounds. Tony, Brian, and Michele are the brains of the group and are developers.
We also have some outside sources helping us with business development initiatives. Once our consumer product is in a good place, we are going to look to white-label it for other sites. For example, we are in talks with a large Real Estate company to integrate Naymz into their corporate extranet so their agents can achieve top search engine placement for their company profile and listings.
what happens if two people have the same name?
This is the number one most commonly asked question when people hear our business model.
The paid search engine platforms have policies against placing two sponsored listings which come from the same advertiser. Google refers to this as “double serving”. So, if there are two Garrett French’s, we cannot put up two unique listings for each subscriber.
The only way around this is to create one general listing in the engines for both profiles. After someone clicks on that single listing, it will take them to a jump page that contains all of the Garrett French’s in our database along with pictures and unique description copy.
what happens if someone fakes my name and puts in erroneous and malicious pages?
This is going to be our biggest challenge.
We have already had a few instances of this and we are doing everything in our power to prevent it. We have flags that go off if certain content is added to a profile page. The logic behind these flags will get more intelligent as more people try to cheat the system.
We also try to manually review each profile that is added. That is going to get more difficult as we grow so we are working to try and automate the editorial review as much as possible.
Our best protection against slanderous pages may be our users. At the bottom of each profile, we have the following message:
Identity Crisis? If you notice offensive or incorrect information, report misuse to misuse@naymz.com
why don't I just buy the ad myself and create a profile page with links to all my personal profiles?
Based on your skill set, you certainly have the expertise to accomplish this yourself. [he totally overestimates me - I like that though. -G] However, 99.9% of people have never run an AdWords, AdCenter or Overture campaigns. Most people certainly aren’t going to set-up all these accounts just to own their identity in the search engines. You can almost view us as a bid management aggregation tool, ala Atlas OnePoint, for the individual.
We also feel we built a pretty slick profile creation page which gives you the ability to create your profile in minutes. You don’t have to worry about HTML, design, hosting, etc.
who have been the biggest subscribers thus far?
It’s really interesting to see the types of people who are building profile pages with us. The majority of early adopters have been industry folk such as web developers, designers, search engine marketers, and your typical Slashdot reader. This has been great, but we hope to attract the general masses as we see Naymz as a potential tool for just about anybody as one’s online identity continues to become increasingly important.
What’s been amazing to us is the amount of international sign-ups we have had. Currently our non-US accounts outnumber our domestic. We got some decent blog coverage in Spain, Denmark, Germany and Japan which has led to a good number profile creations from those Countries. Globalization rocks!
do you have aspirations beyond just buying ads for peoples' names... will this evolve into, say, a single log-in for social sites?
This has definitely been discussed. It would be great to allow users to update their profile information in one unified location for all the different social networking sites they belong to. If and when the social networking sites build developer API’s to allow us to interact with their platforms, we will certainly explore this further.
Our platform could also possibly be repurposed for small business names (i.e. Joe’s Pizzeria) and we can add local targeting to our product suite. However, before we do that, we have 6.5 billion people on this planet we would like to sign up for individual Naymz profiles first.
Can naymz users network with each other?
Currently they cannot. We aren’t presently trying to compete with the MySpace’s, FaceBook’s, and LinkedIn’s of the world. There seem to be plenty of Social Networking sites as is. We view these types of sites as the story of your life.
MySpace covers your social life. LinkedIn goes into detail about your professional persona. Flickr captures your experiences in photos. Likewise, with YouTube, you can be the leading role in the movie of your life.
We want to become the table of contents for your story. We want to be the binding that holds it all together. We also want to help people who are interested in you to be able to find your life story.
We are also looking at some different ways to build a community around Naymz that will be released by the end of the year.
who's done the best coverage thus far? What link are you most proud of (besides the one you'll be getting from SEL of course ;)
I would have to say our review on Rev2.org was probably our best and most comprehensive review to date. Sid Yadav, the author of the blog, really saw the potential of the online identity space and was also very gracious in the review of our product.
Mashable.com also gave us great coverage and addressed some important issues. It also contains my favorite line…”There’s definitely a big demand for this type of service.” We hope he is right.
I'm too hungry to think of follow up questions right now... if you have any send them to me in an email or put them in the comments. <3G Garrett French - MarketSmart Interactive
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Snap Elaborates: Google's CPA, Snap's Target Market, CPA's Not Just for Lead Gen
I was somewhat of a dick to Fred Walti of Snap (in my little asides requesting more feedback, noted by the "+" signs in the body of his responses).
I get like that for some reason right before I publish... I start thinking of how funny it would be (to me) to read SOMEONE ELSE saying what I'm saying and the next thing I know I've actually gone and published it.
In my defense, given the time it took to get the interview from them in the first place I didn't expect a quick response from either Mr. Walti or Mr. McGovern, and so I gave myself more critical license.
Still, that's no excuse for my taking a condescending and belittling tone with Mr. Walti.
Fred Walti and Tom McGovern kindly overlooked my tone and answered my requests for more information very quickly, and for this I thank them deeply, and offer my apologies and a pledge to send questions to them, through Mr. West, in the future, rather than lambast them in print again.
...and I'm defintely going to take up Mr. Walti's invitation to visit Snap the next time I'm out west :)
GOOGLE CPA ++please elaborate - how would you rate Google's CPA experiment at this stage?++
TM - Well its tough to rate a secret alpha test ;-) But from what I’ve read, their first foray into CPA is similar to the affiliate networks such as Commission Junction and Linkshare.
That is very different than Snap, but I would expect Google to expand from there. However it eventually manifests itself, it will be good for advertisers as the incentives will be aligned.
It may not be so great for some publishers if they are the source of poor converting traffic, but that is why it’s a good model - its true performance based marketing.
OUR BACKGROUNDS ++please elaborate: this is marketing fluff, which I think shows disrespect to my readers. *I'm* the only one allowed to disrespect my readers on my blog ;)
FW – Sorry if it came across as “marketing fluff.” My intention was to try to summarize my experience rather than bore your readers with a detailed resume.
what companies did you work for? FW – Companies include: BBDO, Grey, Saatchi, FCB, FMI.
Clients: Apple, P&G, Pepsi, GF, Hanes, Citigroup, Dell, Gillette, Visa. how are *you personally* going to be sensitive through an ad buying console? are you personally working with clients? if so, in what capacity? how, in Snap's sensitivity to "client service," are you different from or similar to GYMA? FW - We’re “sensitive” to advertisers in the same way that Snap.com is sensitive to users – we’re trying to build an application that will be used by people. To be successful, we need to understand user’s needs and deliver something that then meets those needs. Advertisers are no different.
Our long term goal is to build the best in class user experience for advertisers – which means everything from providing full reporting capabilities to answering questions in a direct, understandable manner.
The size of our organization allows me to personally work with clients on a daily basis to get a better understanding of what those needs are. I go on sales calls, draft presentations, shape the product, answer questions, etc., etc.
You’re always welcome to come visit us to see just how hands on we are.
Snap is different; we’re small, we answer our phones, and we return emails. We’re hungry and are willing to work with clients to design solutions to meet their needs.
OUR TECH ++please elaborate: what are your thoughts on creating methods for users to contribute to the search results, or perhaps to import their own personal usage data from projects like Attention Trust? What will be Snap's answer to social search?++ TM - We currently don’t intend to offer personalization of the search results however, we have means on our site where users can provide feedback on the quality of individual search results and the page previews. Every time someone does a search and provides feedback it will make Snap better for everyone else.
++please elaborate: what data are you gathering with the plug in? what is the advantage to the user for downloading the plug in? how will you be driving downloads?++ TM - We actually do not look over the shoulder of the user via the toolbar or Fire Fox plug in. The goal of these is solely to offer convenience to the user.
THE UI What are your metrics for determining if the split screen UI is a success?
TM: We believe the strongest metrics for measuring the success for any search engine are user loyalty measures (repeat rates, for example) and search usage metrics (searches per visit, for example).
++elaborate please: well... what have the results been so far?++
TM: Well I know you will be shocked but we can not be too specific ;-) What I can say is that it is bimodal - some folks absolutely can not live without the experience while others prefer a command line type interface.
THE MODEL Which major companies have been most interested in CPA thus far? Who do you think would most benefit from CPA vs. PPC?
++please elaborate: what *kinds* of companies? What industries or sectors are best suited for CPA? If you say "everyone" then you get detention ;)++
TM: Bring out the paddle... I have not met an advertiser that did not want true performance based advertising! Maybe it is semantics, many people associate CPA with lead generation but it can be any desired business result; a sale, a download, a new customer, an offline lead, etc.
CPA is much more flexible than charging for just clicks and, by the way, a click can be an action. Obviously all advertisers benefit from this model versus PPC, however, as I mentioned above, the beauty of it is that it aligns interests and in the end, that will benefit users as they will be presented only relevant sponsored search results.
++elaborate please: so who's the target market for this sales force? why do you require a sales force - is it because you're not targeting smbs with a console-based ad offering? and is there CPA advertising live yet?
FW: We have a three-pronged advertising target:
(1) SMB’s that are comfortable enough with paid search advertising that they can manage the process themselves. They would be the primary target for our advertising console. We believe this group is our primary channel.
(2) SMB advertisers that either spend sufficient dollars and/or require customer service to handle questions and installations. Part of our advertising sales/service team would be targeted to them;
(3) Large advertisers and their agencies. Eventually, we will have a key account sales force to cover this group.
Yes, many of our advertisers are using CPA today.
Thanks guys - again, I appreciate your time, and look forward to hearing from you with more Snap news in the future. Garrett French - MarketSmart Interactive
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Zixxo's Mike Hogan in 60 Seconds Zixxo's a 3 year old company that enables users to search for and subscribe to coupons in RSS. They got buzz in April (links at end of article) for being a coupon distributor, publisher, destination site, and enabling users to rate coupons and companies.
Zixxo's Mike Hogan pinged me recently to see if I'd be interested in learning more.
Key Mike Hogan Interview Take Aways
...to understand the coupon industry check out zixxo's facts and stats.
...We are in talks with all of the large yellow pages folks and most search engine/portal folks.
...We are in talks with the big newspaper FSI folks (both the big guys in various degrees) and just starting to hear from the newspapers.
...With our API, coupons can be integrated into maps, yellow pages, blogs (a la affiliate links), everything!
...We also built the service to be internationalized and localized and we can't wait to go into Japan, China and Europe, where we have experience as a team.
...The Bay Area is the early adopter based on our location, support from folks like TechCrunch and the technophiles in the area.
...we have a design/development guy, three core developers, an operations/NOC guy and me handling everything else.
...we became the AdWords/AdSense of coupons.
WHEW! We slipped that in at 233 words, just under 60 seconds or so of your precious attention!
Zixxo's CEO Talks the Start Up Process and Disrupting the Coupon Space
(This is the 7m 45s version (1,800 words). For the weary-eyed, attention-crunched, and the unappreciative of gratuitous brilliance I'll have a 1m 30s version out soon ;)
Coupons. I use the postcard coupon that Valvoline sends me for 5 bucks off my oil change, but that's about it. I don't get the newspaper, and have never been a coupon clipper.
Thanks to Zixxo, I've had the chance to dig into *another* industry I know nothing about (most recently it was the print Yellow Pages...), and further, to really crunch on what a coupon means in the relationship between buyer and seller.
Zixxo's a 3 year old company that enables users to search for and subscribe to coupons in RSS. They got buzz in April (links at end of article) for being a coupon distributor, publisher, destination site, and enabling users to rate coupons and companies.
Zixxo's Mike Hogan pinged me recently to see if I'd be interested in learning more.
I asked my standard "why should we (the industry) give a crap about you" questions - what's your background, who's written about you, who's going to be writing about you.
His background was very compelling - he
"worked for Novell in Corporate Development where I did a partnership with IBM for co-branded distribution, I created the directory strategy and licensed the directory to IBM, SUN, HP, Fujitsu and others. Then I ran Business Development and Strategy at Poet Software. I got the company into XML, wrote the first business white paper on XML ever in 1997 (before it was a standard), led the company into B2B eCommerce and we took Poet through IPO. Then I opened Japan for the company."
He told me to check his site for current write ups, and said Michael Arrington had showed strong interest. So I pretty much shut my mouth and whipped out some interview questions.
I'm no Brian Smith, so I'll leave it to *him* to say where Zixxo fits into shopping search historically.
Zixxo, to me though, fits into the shopping search space in the way that Jellyfish does, by putting shoppers and sellers into more direct and meaningful contact.
In fact, all I could keep thinking as I reread Mike's interview this morning was "Zixxo + Jellyfish" ;)
Mike Hogan's answers below not only show Zixxo's compelling business model, but shed some light on the start up process in general.
BIG THANKS to Mike for his prompt and illuminating responses, which he sent back to me from his vacation, and I did NOT post during my vacation.
***Hogan's Background*** what experiences in your professional background have you found yourself drawing on the most heavily in zixxo? I do everything but code. On the drive yesterday, I was writing a patent application.
Starting a company you do things in phases.
Phase 1: product definition, business model, product management stuff.
Phase 2: Outbound marketing and PR.
Phase 3: Business development and sales and fund-raising…soon international market development.
Basically I use everything I've learned but I do so in phases.
how did you become interested in this space? Long story, but I was a big XML guy and thought we could add more structure to free classifieds (think Craigslist where you could search for cars based upon tags like make, model, year, mileage, etc.).
But how to make money in local… hey how about coupons. Then we realized that free classifieds are, well free, and everyone was doing them and Craig was huge so why not focus on where we are unique.
So we became the AdWords/AdSense of coupons.
***Zixxo's origins, the team itself, starting up*** where did the name zixxo come from? We wanted a new word so we could create the brand.
At the time the major Internet brands were Yahoo, Google, Kazaa. They all had 2 syllables and double letters. A study a while back said that double letters are very memorable and the double X's the most memorable. The company that funded that study became Exxon ;)
So we wanted 2 syllables and double X's. We also like the "Z" because it is the least used, and therefore most memorable/odd letter. Then we could get all of the local and foreign domain names…winner!
How long have you had zixxo, and what does your team currently look like? We've been working on ZiXXo for 3 years. My team looks ugly (led by me). But seriously, we have a design/development guy, three core developers, an operations/NOC guy and me handling everything else.
How did this team form? What does your geographical location have to do with your team that has formed? It formed based upon past working relationships. We all worked at Poet Software together, except 2 developers who came through a relationship with one of our team. Geography had nothing to do with it, quality had everything to do with it. One developer is in NJ, the rest are spread around the Bay Area.
what has been harder thus far with zixxo than you anticipated? Funding. It appears that once one company in the segment is successful, it is easy to get the second and third ones funded. But get an original company funded is tough. I'm also very focused on building a great service and funding takes a lot of time.
what has been easier? Evolving the product. Our team is great and when I have an idea, they really jump on it and build it, often times when I'm still just discussing an idea…boom it's built.
***coupon industry*** please describe/explain the coupon industry. (is the yellow pages industry analogous?) Please see our media center facts and stats.
Basically 88% of the coupons are national and delivered through the newspaper because using a 1% redemption fee it costs about 30¢ per redeemed coupon. Local couponing is far too expensive due to distribution costs (postage). Consider a simple postcard, presorted at a rate of 29¢ per piece. With a 1% redemption rate that means $29 per redeemed coupon. Hello Internet, goodbye costs. And you can do so much with coupons to drive favorable consumer behavior (not just 10% off) see here (you'll love this one!).
what do newspaper ad insert partnerships or conversations/contacts do you have? We just came out of hiding with our syndicated coupon solution in late April. We are in talks with all of the large yellow pages folks and most search engine/portal folks. We are in talks with the big newspaper FSI folks (both the big guys in various degrees) and just starting to hear from the newspapers.
what industry do you think you'll be/are the most disruptive of? Tough call. We could disrupt online advertising because coupons blur the line between content/ads. The coupons get integrated into the organic results, not the little used ad gutter. We totally disrupt local direct mail couponing.
With our API, coupons can be integrated into maps, yellow pages, blogs (a la affiliate links), everything! We could disrupt yellow pages, but really they reinforce print and online ads by reinforcing the success of those ads on a daily basis in the merchant's mind.
Basically, it sets up a sort of coopetition (to quote Ray Noorda) in most areas, except direct mail couponing.
***Zixxo now*** your current partnerships: We don't have anything we can announce yet, but online/offline yellow pages and portals/search engines.
your sales force: we use an affiliate model. You can register as an affiliate and see our tools…very comprehensive.
We provide all sorts of banners, email signature file, email content, text ads, articles, etc. Since we share revenue, all partners can act as affiliates.
your growth strategy in general: grow big fast! ;)
We provide a white labeled version, so big companies can offer a solution "powered by ZiXXo" that looks like their own. This, in combination with our API and affiliate revenue sharing can really power our growth.
We also built the service to be internationalized and localized and we can't wait to go into Japan, China and Europe, where we have experience as a team.
Your API - is this operational now? Yes.
What uses of your API have you seen thus far? We just released it and announced it. People are playing with it now.
Who's expressed the most interest? The big guys want to integrate coupons seamlessly into their search results (local) and maps.
what zipcodes have adopted the most quickly? The Bay Area is the early adopter based on our location, support from folks like TechCrunch and the technophiles in the area.
have local or non-local adopted your model more quickly? So far it is a mix. The webstores tend to be technically savvy and cutting-edge, but we get a nice mix.
***Zixxo in the future*** coupons on cell phones, by sms - what if I don't have a printer? Absolutely! We're working some partnerships now.
partnerships: merchantcircle.com: they reached out to us recently yokel.com: not yet, unfortunately I'm in reaction mode now because of the large number of contacts. naymz.com? same as above (not yet)
***API*** Discuss the API concept (not YOUR api, just the concept in general) briefly - I'd like to hear the concept described by someone with your experience in architecting and executing partnerships...
APIs are huge (just ask Microsoft). Once people integrate, they don't easily rip it out.
But generally speaking we want to be the service for coupons that all website and web applications use. But those companies want to own their customer relationships. Our model is very focused on enabling our partners to own the advertiser relationship (through white label or co-branded solutions) and the consumer relationship through seamless integration of coupons into their solution. The API makes everything seamless and avoids the "ownership" conflict.
It also allows our coupons to be in the content instead of relegated to the ad gutter.
What APIs in our industry have caught your attention, were inspirations for zixxo? Flickr, Del.icio.us and Google Maps.
***the nature of the coupon*** what makes these coupons - why are they not simply ads? By delivering consumer value through a promotion. We make it clear that they must offer some value. Then we enable consumers to rate the coupons (by value) so if your coupon offers no value, you'll get a low rating and people won't look at it. In that sense it is self-reinforcing to offer a good value.
Then our API allows sites to pull coupons based upon their rating among other things.
***RSS and consumers*** consumer rss adoption - who's driving it the best right now from the rss reader perspective? what reader is most popular with consumers using your coupons? I don't know which reader is the king, but we have gotten raves for our ability to generate customized RSS feeds (or emails) by location, interest, keyword, coupon-type, etc.
Follow up questions for Mike: How have you paid yourself and your team for the last three years?
What is the nature of a coupon? What is it transactionally? When does it work? When does it not work? Who should have coupons who don't use them now? What are coupon creation best practices?
Users can search by coupon ratings - how will you prevent sellers from voting for themselves?
How do you incent ratings and votes by users?
How can an API/affiliate strategy really give you the penetration you need in the local market place?
Dear Reader leave your questions in the comments, should you have any. Garrett French - MarketSmart Interactive
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June 27, 2006
G's in NYC
Posting will be light *yesterday* due to the drive through DC and Baltimore's pouring rain and floods. And *tomorrow*, when we're driving back to Raleigh :)
light posting today too Today we (me, Brandy, Hannes) are going to Carmin's last day of school picnic. Carmin's 9. She's coming back with me and Brandy to live with us for two months this summer... my first full-on dad experience. I'm super excited :)
new stories coming soon I've got a zixxo interview coming soon (it's in my inbox and has to be edited), mpire too, I hope a follow up with Jellyfish and maybe the guys at Snap will snap back at me :) Oh yeah - also I sent off an email interview to the Naymz guys.
So there's some great stuff coming - I also got an email from pinpointpages, who I'll shoot an email interview at too.
missing out I had hoped to catch up with mr. Fawkes and mr. Schwartz while up here in NY... but I barely have time to post this today ;)
NC investigations Wine and tech start ups. I'm going to be digging in to some home grown NC industries upon my return. I can't wait.
coming soon One of my articles is getting published in MarketingProfs next week. I'm so excited - that's been a goal of mine for a long time. It's the first of many I hope :)
gotta run Ok - I'm off to consume some NYC and family 2.0. We'll talk soon.
Snap Speaks: CEO and COO talk CPA and Making it in Mainstream Search
Hi! This email interview with Snap's CEO, Tom McGovern and COO, Fred Walti, is 1700 words (well, more now with this introduction - dang!) and will take at least seven minutes of your time to read.
Of course it's more than worth it.
Attn. Snappers: I've marked certain areas of the interview with "++please elaborate" tags and further questions. Either post in comments or shoot me an email :)
If you, dear reader, are unwilling to commit 7 or so minutes of your life for some blissful brilliance you should read the 90 second Snap CEO/COO interview overview.
Loren Baker's Google AdSense Testing Cost-Per-Action Payments provides an interesting context for reading - news of which may have lit a fire under someone's rump to get this interview finished perhaps?
++please elaborate - how would you rate Google's CPA experiment at this stage?++
Without further ado I give you Tom McGovern and Fred Walti of Snap: ***key people*** Tom, what past business experiences do you find yourself drawing on the most as the CEO of Snap?
Both you, Tom, and your COO Fred Walti have strong media backgrounds. How do you think this influences the direction of Snap?
FW: I’ve spent more than 15 years working with advertisers and their agencies. As a result, I’m pretty familiar with their world, their needs, and what they want. Perhaps most importantly, I’m very sensitive to the issue of “client service.”
We intend to be good business partners with our advertisers in every way possible, including offering a very distinctive advertising product, pricing it right, and making it easy to do business with us.
++please elaborate: this is marketing fluff, which I think shows disrespect to my readers. *I'm* the only one allowed to disrespect my readers on my blog ;)
what companies did you work for? how are *you personally* going to be sensitive through an ad buying console?
are you personally working with clients? if so, in what capacity?
how, in Snap's sensitivity to "client service," are you different from or similar to GYMA?++
TM: Contrasting Fred, my background has been less about branding and more about data driven marketing.
We use that combined approach both in our decisions on how to spread the word about Snap as well as the product itself. We strive for both form and function.
What is the core strength that Gladys Kong brings to the search team?
TM: Gladys, our VP Engineering, is a technologist with an expertise in large scale distributed databases as well as technical management. I think she has been involved in more start-ups than anyone here.
Gladys was happy to see the arrival of our new CTO, Mike Agostino.
Mike joined us recently from Symantec. Before Symantec, he was in venture capital working at Vulcan and prior to that he was an early Infoseek team member. He goes by the nickname Spiderman so you get the idea of what he is all about.
***the tech*** Do you have a crawler or use other indices? Do you have your own algo? If so, how would you say it differs from the algos we may be familiar with from Google, MSN, Yahoo and Ask?
TM: Yes, we have our own index. I can not tell you how we differ from the others as we have not seen their algos.
Our approach is to combine traditional text based IR and the use of behavioral data to deliver results ranked on user satisfaction rather than words and links.
++please elaborate: what are your thoughts on creating methods for users to contribute to the search results, or perhaps to import their own personal usage data from projects like Attention Trust? What will be Snap's answer to social search?++
***the design*** who came up with the split screen concept? where has it been done before? what makes yours better?
FW: The inspiration for the split screen came from our founder, Bill Gross. We first applied the Results-Left/Preview-Right concept in our News section which received a lot of positive feedback from our News users.
We then built a beta search engine using this concept last summer and launched our GA product on May 15th of this year.
No other company that we’re aware of has a similar results left/preview right interface.
The advantages are numerous, but can be grouped into three areas:
(1) We believe it’s easier to SEE what you’re looking for rather than READ what you’re looking for. Hence, using our site previews allows visual pattern matching which is much quicker than reading text;
(2) Because we’ve seamlessly integrated the preview into the interface, it makes it very easy to fast browse lots of results. Try going to one of the Big Search engines and look at 10 results from any search. You’ll have to go through the hunt and peck method for viewing results. Now go to Snap and fast browse those ten results using your up/down arrow keys. Essentially, we’ve created the search engine version of channel surfing on your TV;
(3) We allow the users to directly interact with the actual site if they want. Either through clicking on the preview, using your right arrow key, or downloading the Active X plug in, Snap users can quickly interact with each search result’s site.
++please elaborate: what data are you gathering with the plug in? what is the advantage to the user for downloading the plug in? how will you be driving downloads?++
What are your metrics for determining if the split screen UI is a success?
TM: We believe the strongest metrics for measuring the success for any search engine are user loyalty measures (repeat rates, for example) and search usage metrics (searches per visit, for example).
++elaborate please: well... what have the results been so far?++
***the model*** What is biddable for marketers within the Snap CPA system - it's my understanding marketers set the CPA themselves, so how do you determine where they appear in the SERPs?
FW: An advertiser’s ranking is based on primarily two things:
(1) The bid amount of the action they’re looking for: download, subscriptions, a sale, etc. Each advertiser places a bid on what they’re willing to pay for an action and their bids are placed in an auction similar to other search engines; and…
(2) Their ranking will also be moved up/down based on how well they convert. We believe that an advertiser’s conversion rate is a very good measure of relevance since a higher conversion rate implies a better offer/product/sales environment.
We look at these 2 elements in connection with our algorithmic determination of relevancy to score and rank the results with a goal of maximizing user satisfaction. That is a bit different than other search companies that want to maximize revenue per pixel.
Do you think that if Gross had presented CPA instead of PPC with GoTo that it would have caught on in the same way?
TM: I personally think so. CPC associated with search really took off once we had the bust in CPM’s so I think that the market condition was ripe.
But at the time, CPC was radical and no one imagined click fraud would be as big of problem as it has turned out to be. But as most change is, it’s an evolution and the industry will embrace CPA over time.
Joseph Sarmiento has a strong background in inside sales - does Snap have this kind of structure in place, and do you see inside sales as a means of encouraging CPA adoption?
FW: Snap is committed to building a strong advertising sales force, some of which will be inside and some of which will be aimed at national accounts.
++elaborate please: so who's the target market for this sales force? why do you require a sales force - is it because you're not targeting smbs with a console-based ad offering? and is there CPA advertising live yet?
Which major companies have been most interested in CPA thus far? Who do you think would most benefit from CPA vs. PPC?
FW: We don’t release information about our advertisers to protect their competitive advantages.
++please elaborate: what *kinds* of companies? What industries or sectors are best suited for CPA? If you say "everyone" then you get detention ;)++
TM: One thing that’s important to note about CPA is that it fosters sharing of information, in particular conversion rate information. As Fred mentioned, we use that information as an element in scoring results.
So, all advertisers like CPA but the ones that are going to really benefit are those that serve users well and have a high conversion rate. They will move up in results based on user satisfaction rather than having to out bid their competitors.
And what about looking for AdSense-type CPA syndication?
FW: We will look for these type of opportunities in the future.
And what about video ads - is CPA a possible model there? Is Snap looking at media outside of text?
FW: Once we’ve established our core mission, building a great general purpose search engine, then I’m sure we’ll look at other opportunities.
***the vision*** In The Search Battelle mentions that Gross had a hard time deciding whether to make GoTo an ad syndicator or a search destination. Your innovations with SERPs display indicates to me that you're headed in the destination direction. Are you?
FW: Yes, we’re building a search engine equally targeted to users and advertisers.
TM: Creating another Overture would have been kind of boring.
If so, can you outline the steps it will take to gain marketshare against Google, Yahoo and Ask? Because I think it's going to take ALOT more than changes in SERPs display...
FW: We believe that Snap.com can garner a significant place in the search market by offering a very differentiated product that represents a true alternative to today’s Big Search engines. Our differentiation today revolves around three significant areas:
(1) A totally different user experience resulting from a fast, interactive, visual search UI;
(2) Improvements in relevance through the use of behavior data in the ranking algo; and
(3) An advertiser proposition that includes CPA and a very impactful advertising environment.
While we would certainly agree with your assessment that it’s going to be tough to compete with the large players, we think it is possible to compete with an alternative approach.
Beyond product differentiation, our marketing approach is differentiated as well. Rather than spend millions of dollars on traditional advertising, we are generating a dialog amongst the search community with people like yourself.
Right now, more than 1050 blogs have links to our blog. Many people in the industry have noticed that the Snap blog is one of the most active blogs in the search community right now.
Part of this excitement is the result of our “Snap the other way to Search Contest” which we launched when we re-launched the product on May 15th. The contest called for ideas on how to market Snap. More than 200 ideas were submitted with over 3000 votes were cast for the favorite idea. We’ve received more than 30,000 visitors to our blog alone. We’re going to announce the winner on June 29th via a web cast.
TM: One other point, we don’t intend to out-Google Google.
This market is growing and users are becoming more sophisticated and their tastes and preferences are becoming less mass market. So while not everyone will like the Snap method of search, there is a role and opportunity for Snap for those that are more visually oriented and are tired of clicking on blue links to see the real search results.
What's the point of developing a "better search experience" at this stage in the game? Why not be happy with developing a CPA search marketing console add-on for the major search players?
FW: Because users tell us that they want a better search engine.
Our research and analysis shows that people still can’t find what they’re looking for a lot of the time; that they’re frustrated with the amount of time they spend looking for things on today’s search engines; and that they feel that there isn’t any difference between the GYM offerings.
So, with our history of innovation and leadership in the search business, we’ve set out to build the next generation search engine that changes the ball game once again.
TM: Thanks for your time!
No no! Thank you guys! I appreciate *your* time and look forward to your answers to my request for elaboration in the next few months ;)
JUST KIDDING TOM AND FRED - I know you're busy. Thank you, seriously.
And if you, dearest reader, have questions please send them in or leave them in the comments section of this post.
And, if you read ALL the way through you likely spent around 8 1/2 minutes.
It's time for a break: enjoy 5 minutes or so of the latest Yacht Rock episode on Channel 101 or join my clan on Kingdom of Loathing and spend the next 5 hours doing really stupid things for meat. Garrett French - MarketSmart Interactive
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My Snap CEO/COO Interview Highlights (a 90 second overview)
I just got back the LONG awaited interview with Snap's CEO, Tom McGovern, and COO, Fred Walti. It's all the more relevant now in light of Google's experiments with CPA.
As an added bonus for waiting Stephan gave me Fred Walti, Snap's COO too.
The interview is 1,700 words long and will take you approximately seven minutes to read. That's why I'm providing the ninety second version in this post (assuming 4 words per second).
Key Takeaways, All Direct Quotes:
TM: The inspiration for the split screen came from our founder, Bill Gross.
FW: [Advertisers'] [ad] ranking will also be moved up/down based on how well they convert. We believe that an advertiser’s conversion rate is a very good measure of relevance since a higher conversion rate implies a better offer/product/sales environment.
TM: ...at the time, CPC was radical and no one imagined click fraud would be as big of problem as it has turned out to be. But as most change is, it’s an evolution and the industry will embrace CPA over time.
FW: We will look for these type of opportunities [AdSense-type CPA syndication] in the future.
TM: Creating another Overture would have been kind of boring. [in response to "Your innovations with SERPs display indicates to me that you're headed in the destination direction. Are you?"]
FW: We believe that Snap.com can garner a significant place in the search market by offering a very differentiated product that represents a true alternative to today’s Big Search engines.
FW: Our research and analysis shows that people still can’t find what they’re looking for a lot of the time; that they’re frustrated with the amount of time they spend looking for things on today’s search engines; and that they feel that there isn’t any difference between the GYM offerings.
Stay tuned for (working title) Snap's CEO and COO on CPA and Making Headway in Mainstream Search. It may have a different title in the next fifteen minutes, as there are way too many acronyms as it stands.
Print Yellow Pages Used at MicroSoft + My Yellow Pages Interview Questions
Peter Krasilovsky gave me quite a lesson regarding the Yellow Pages industry, one that I, as a mostly-internet media consumer (no TV, college radio only) needed in order to understand the realities of the local business-locating landscape.
I wrote recently to the Yellow Pages Local Search Guide (a yapr custom media project for the Yellow Pages Association - looking *decent* so far guys, contact me for stronger critique :) recently when I found they'd linked to MarketerToday as a local search resource instead of Search Engine Lowdown.
Their yapr contact person agreed to set me up with an interview with a Yellow Pages Association exec.
Senior Sterling sat killing a few moments in a MSFT waiting room and noticed people using the print Yellow Pages:
"I asked the woman seating behind the massive reception desk, "Why do you have this here?" "Oh people use it all the time," she said. "Really," I replied, "for what?" "For lots of things," she responded and proceeded to list six or seven different local business categories."
"It's somewhat ironic that even in the most high-powered corners of the computer and Internet world, the yellow pages is still seen at least by some as a desirable and reliable source of local business information."
Ironic is right. So anyways here are the questions I asked the Yellow Pages Association, which are supposedly going to be answered by next Thursday:
- explain to me who owns the Yellow Pages; is it one company or many? Do they compete with each other in some way, or do they stay in their zones? Please help me to understand the ecosystem.
- geograpically speaking, where are PRINT yellow pages the most used?
- does IYP compete with YP? Why or why not?
- is there more ROI in print YP ads than online IYP ads? Why?
- incenting the local YP sales force to sell IYP ads is hard because IYP ads are cheaper and therefore have lower commission. this has paved the way for YP partnerships with Google and Yahoo, but won't this ultimately cut the IYP out?
- traditionally, what is the difference for a local business in advertising in the Yellow Pages vs. the local newspaper vs. the print classifieds vs. local tv ads? How do these mediums differ?
- Are the IYPs as splintered as the YPs? Who's calling the shots in the IYPs?
- Will the IYP venture into more of a MerchantCircle model, where businesses have more direct control over their "presence" and can use the service as a platform for building stronger relationships with their local clients?
- How do copy-point experiments make their way into your databases? who makes these decisions? is it your info providers, the Axcioms, the Amacais?
- How would you characterize the IYPs relationship to Google/Yahoo?
- What is your competitive advantage over Google/Yahoo? Is it simply that you have more users? Is it coupons? Is it your relationships with the data providers? Is it your local sales forces?
- Ben Smith seems to think MerchantCircle, without a sales force to speak of, will undercut your print/online business. How would you characterize the MerchantCircle offering?
- What do you think Krasilovsky meant when he said: " MerchantCircle is a mediocre Yellow Pages offering"
(if you'd like to answer any of these questions write me or just answer them in the comments. be sure to reference which question you're answering - G) Garrett French - MarketSmart Interactive
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New YouTube Features Push Farther into MySpace Territory
YouTube now enables users who consider themselves musicians to sign up as a musician: http://youtube.com/signup?signup_type=m
I'm not yet sure what that entails in regards to how they appear in the network, or whether, like MySpace, YouTube will enable musicians to upload their own music.
MySpace grew, according to my anecdotal understanding, in large part because the LA music scene adopted it (and because it had blogs before friendster...) and has remained a crucial platform for local musicians everywhere to stay in touch with their audiences. As evidenced by the invite spam I get from musicians every day.
Local music is, well, local, and is a strong social glue in MySpace.
MySpace recently launched a video upload service, but it's not as well integrated into profile pages.
If YouTube got wise and put an actual written blog function onto profile pages, and enabled users to rate each other as WELL as each others' videos I think they'd have a stronger MySpace contender.
YouTube suggestion + business model idea: Also, please please please YouTube enable me to make a continuous video play list - so that I can preload 20 or 30 videos and watch them straight through without having to click play every 30 seconds.
You could throw little ads in after every 5 minutes or so too :)
(Check out Fawkes 5 alternatives to MySpace post for others muscling into the social networking turf.)
Profile Page Changes YouTube has also made changes to the profile pages, which you have to be logged in to see:
There's an "active channels" section on the far-right nav, which shows me 4 randomly refreshed channel profiles of other users (these should be recommended channels based on my viewing history and the videos in *MY channel* but that's a job for Greg Linden...)
This will encourage more video exploring - which is currently YouTube's strength when it comes to video navigation.
The "active groups" section, also on the far right nav, has 2 suggested groups, which are user organizations based around topics such as the lonely island.
Overall it's cleaner, and, as the little announcement says, "Your shared videos, messages and friend requests have now all been consolidated into one handy dandy new Inbox."
MySpace Updates MySpace added a sketch comedy section, which could come to rival to some extent Channel 101, plus the other sketch comedy video sites popping up in Channel 101's wake.
MySpace Books section enables users to find good books and will get them come Amazon affiliate cash. Plus authors are using it for marketing themselves too...
Why is Social Networking Covered in a Search Blog? At its core, search is a means of navigating vast tracts of information. Social networks such as MySpace and YouTube provide a more social method for navigating information (as of course do PreFound, Eurekster, Yahoo and Google).
If you're a small, local business looking for the social networking edge you should look at Merchant Circle in addition to MySpace. Garrett French - MarketSmart Interactive
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Ari Rosenberg: It's About Marketing *IN* MySpace, Not *ON* It
Frenchy sent me an article from media post yesterday entitled "Get Out Of MySpace", by Ari Rosenberg (free reg req).
Wow, did Ari ever miss the boat
I will try to take his article point by off-base point correcting bad assumptions and delving into the real issues along the way.
Early in the article, Ari says, "However, beyond the "massive reach and engagement" that MySpace delivers, advertisers do not like what they see."
He was on track with his analysis of the recent press about sexual predators and that the news is hurting the MySpace Brand. He also discusses the MySpace Spam issue which is a growing concern among users.
He should have stopped there and stayed away from discussing the value of MySpace as a marketing channel.
The real problem is that advertisers do not yet understand how to harness the community in MySpace.
This is especially a problem for the ones who need streamlined processes on every marketing channel they offer their clients. The reason its difficult for them is not because of porn or spam. It’s because they just don't understand that is not about just people and interests.
It's about value and community
If you create a MySpace page to sell a product to a demographic you lose. If you create a MySpace Page to foster community conversations, you win.
For example. The new superman movie is not marketing *on* MySpace, they are Marketing *in* it.
It's not easy and requires out of the box thinking but there are a lot of products and services that can be marketed well through community interaction.
Again, it's not just about products and services, it's about interacting with a community and facilitating value added conversations.
After all, that is what people are on MySpace to do anyway of which Ari barely scratches the surface here, "You create your own MySpace page, and then you can quickly become networked to those with similar interests."
You should create a profile for your company with links to good mod resources and in your profile blog about things that you - as the Scion enthusiast you certainly must be - are interested in. Then use the many resources available to mine MySpace for people with similar interests and invite them to be friends.
Write a thoughtful product review in the blog area with a link to buy it at a discounted price on your site. If you wanted, you could even create a profile for a particularly hot kit to incite discussion on that the page about it.
The key is that you are there to create useful interaction and build a community, the products are secondary.
MySpace is just another marketing channel but the rules are all the same. It's all there, Product, Price, Place and Promotion. The only thing that changes is Place.
This brings us to my next point
Ari mentions that, "The publishing business model at MySpace by definition lacks a clearly defined content strategy and the guiding principles of authenticity and credibility. The rates for the inventory sold currently on MySpace are indicative of a lack of perceived value."
This is true from a traditional advertising standpoint. However, it's the lack of a "clearly defined content strategy" that enables people to be authentic in the space, and his assumption that content strategy provides the "guiding principles of authenticity and credibility" is absolute bull crap.
For instance, I can tell by the content of Ari's article that he lacks credibility and authenticity when discussing the subject of MySpace despite his clearly defined content strategy. I hope it is clear to others as well in his closing paragraphs where he starts with a completely ill informed assumption and jumps to a more disturbing and misguided question.
"MySpace is less like a publisher and more like a property owner for what appears to be a gigantic online flea market for young adults to sell their wares. Web cams, mortgage rates, music, or just their own self worth--everyone seems to be selling something. So it begs the question--if MySpace is crawling with sellers selling to sellers, does it make sense for advertisers to advertise in an arena with no buyers?"
Every seller is a buyer, every buyer is a seller. That's the whole point of a market economy. MySpace can be a great marketing channel if only more people know how to use it.
The Core MySpace Problem
All that being said, the core of all of this which Ari wasn't even on the same planet with, is that MySpace itself doesn't currently realize the potential of the movement they have harnessed. Because of this, they have confused the value proposition for themselves and for potential advertisers.
It is this confusion that has led Ari and so many others down such an awry path.
What's happening is that MySpace is still looking for a way to entice online marketers to advertise with them.
To date they have only been able to allow buyers to purchase impressions across the whole network leading to a string of very limited advertising campaigns for movies, bands and dating sites.
The value of MySpace is not across the whole network at once but in the inch wide and mile deep interconnected communities within the 40 Million + users on MySpace.
And... Here is MySolution for Marketing *IN* MySpace
MySpace needs to set up a bid system much like AdWords where people could bid their placements on highly-targeted individual MySpace profile pages (exact match) and all of the friends of that profile (broad match).
Advertisers could get help selecting whose profile to advertise on through contextual or demographic suggestion tools - surely this information would be easy for MySpace to mine.
The owners of those profiles could even get a small kick back on the advertising revenue generated by their page, fostering even more user generated content creation and community building.
That's it. It's simple and concise.
The trick is to stop looking at MySpace as an impenetrable forest and start to harvest the value of the trees.
Let me know what you think? Leave a comment or email me. Adam Schultz - MarketSmart Interactive
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June 22, 2006
Branding in Search Marketing: Let's Discuss HOW, Not IF
Yesterday's post by Scott Karp on Publishing 2.0, which he subtly titled “Search Advertising Does Not Build Brands,” drew (trolled for?) search marketing's strongest defender, Danny Sullivan.
Despite the strong words and obvious anger in the comments between Sullivan and Karp, they're not really *disagreeing* with each other.
Karp's key point is this:
...search does not do the kind of brand-building work that visual advertising has done. To say that there is brand building done by the company once someone clicks through does NOT mean that the search ad did that branding.
I agree with Karp here. Search does not do the *kind* of brand-building work that visual advertising does.
But it certainly does some kind of branding, as Danny points out:
...there’s definitely some branding value in search — and the more you talk with some actual brand owners who are spending that money and who are NOT afraid search will wipe them out, the more you realize this.
The point that I can best sympathize with came from Jonathan Mendez: “Brands are built through experiences.”
So guess what, Scott and Danny are both right.
Rather than viewing these mediums as isolated experiences, I think there needs to be branding credit given to all mediums as they contribute towards this experience.
Ultimately, a more valuable debate is *what* kind of branding does search marketing provide - both organic and paid - and how does this kind of branding differ from the branding delivered by, say, banner ads, online videos or MySpace profile placements?
And most importantly, which is best suited to meet your company's branding goals?
Their debate certainly proved timely for me - I'm currently writing a strategy article on integrating search and media buys, and the branding opportunities in both. Geoff Lamm - MarketSmart Interactive
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June 21, 2006
Search Engine Lowdown's *Industry Analysis* Best Of
Welcome to an SEL nav hack. Here are all of our recent industry analysis posts that I could find/remember. If you have additions, comment them or email selowdown@gmail.com.
