advertising
Over the coming weeks, I’ll be rebuilding some newspaper sites.
If you are weak in the knees, don’t click through, because it’s pretty bad.
http://www.thehour.com
http://www.thestamfordtimes.com
http://www.wiltonvillager.com
Tomorrow, we have our first meeting and I’ve decided to take the rest of you along.
It should be fun.
Subscriber vs. Free. . .
full text feeds vs. partial. . .
traditional journalism vs. community and blogging. . .
display ads vs. collecting detailed attention and gesture data with which to empower users to control their vendor relations. . .
(well, you know)
stay tuned
Newspapers need to take a lesson from baseball.
It’s mid to late innings and your team is losing but you have a man on first.
You give a decent hitter a “sacrifice bunt” sign. No one likes to get this but it’s part of team play.
The hitter bunts and the infield comes charging. The runner is going and safe at second and the hitter is thrown out.
Now you have a man in scoring position. There is no gurantee that the next batter will get a hit. In fact, the chances are pretty slim.
Still, it’s a popular managerial strategy.
Newspapers have a man on first (classifieds and local ad dollars), but they are losing the big game (search and Attention). If they don’t make a sacrifice (open up), they’ll need two hits to score, and that’s a long shot to say the least.
Sometimes you need to take one for the team.
This quote [Thanks Doc] from the academic paper written by the founders of Google is interesting for more than one reason.
The first and obvious is that it seems to stand in stark contrast to Google’s most lucrative intitiative, AdWords.
The second is that search itself is a VRMish RFP (request for proposal) at its most embryonic level.
The question, then, is whether Google sold out, or has just laid the groundwork for a new era.
Doc Searls doesn’t explicitly mention VRM, but tells how VRM can save Internet Radio. Make sure to clcik through and read his Linux Journal article. That’s where it gets real ineteresting.
It sounds to me like Doc is pointing out that ASCAP and the others are next for disintermediation, as a new public radio market emerges to replace the drowning old advertising based radio regime.
Apr 18 2007 10:54 am |
media and
advertising and
VRM |
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Frank Gruber used to work at Tribune, where I still do (for the moment, pending a Gannett buyout, any day now).
Frank points to a post about Sam Zell, who is buying Tribune, who suggests that newspapers close themselves off to Google News.
Frank mentions the attention economy and basically suggests that closing a site off to the world in this environment would be Suicide 2.0.
And he should know.
Frank works as a product manager for AOL, a company that recently realized they needed to open up their walled gardens in order to compete and regain their losing market share of attention.
So far, it seems to be working well for AOL.
Frank also was a stalwart at Tribune for opening things up, getting them to open up their content to RSS feeds, despite the fact that they refuse to publish full text. I’ve been a member of Tribune’s Product Development Committee for years now, and have never gotten a decent answer on why we are not allowed to publish full text feeds.
Frank is right when he says it would be ashame if Tribune falls backwards and goes the route that is being suggested. It’s tough enough for traditional media to make it without setbacks like that.
We shall see. Old Media Doomsday, anyone? I believe it may click soon!
Update:I re-read Scott’s post and think I may have mis-interpreted it. I think he is saying the flaw is in the way the ads are sold, not online advertising itself, to which I agree. (Could be the Black and Tans. I’m Italian, but my mom says we are all Irish on St. Patrick’s, so I have a Guiness and some Corned Beef to celebrate too.)
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I’m usually on the same page as Scott Karp, but not today.
Maybe it’s because I’m snowed in and it’s St.Patrick’s (Black and Tans), but what he calls a flaw of online adverting, I call a fix to a flaw of traditional advertising.
First of all, it’s not only Yahoo and the big boys getting premium rates for page views. As the producer of a couple local newspaper websites, I can say that our page-views are worth much more than $1 per a thousand.
It’s true that national advertiser can sometimes get that CPM, but it more like $4 to $18 per CPM and that doesn’t include the text ads we have on the page. Nor does it take into account that each page-view serves 2- 4 display ad impressions. And some pages are sponsored also.
All in all, I’d estimate that our cost per reach is lower than our in-print advertiser cost per reach, but not that much lower.
The fact is, I don’t think either rate is as valuable as the cost, so we are in agreement that pay-per-click is bringing down the the total value of a page view.
But that’s exactly what we want, as an industry. Wha?
Like Scott says, it’s about knowing who your users are. The value of an ad is in what value it delivers to the advertiser, not in what perceived value any salesperson can convince the advertiser that a particular buy has.
And, like I’m sure Scott knows, the internet is best at bringing the margin between cost and value together, to zero in some cases.
It’s not a flaw, it’s a virtue.
I guess that means that high traffic does not equal a business model. Popularity is not enough, though huge popularity is still enough for the time being.
I think that’s just because we are in the huge transition. We now value things by the old model, “perceived and estimated value.” We soon will value them by the new model, “true value.”
That’s where Doc’s VRM will play a large role, as well as gestures and intention.
I see VC’s as the ones placing faith in page-views, moreso than web 2.0 companies. Most Alot of them are aiming right, I think.
Who can’t resist the allure of high traffic, though.
Ed Batista discusses successful relationships as put forth by John Gottman.
As I read what it takes to form a successful marriage, I couldn’t help but think that VRM and CRM need to embrace these same ideals.
This one really pops:
7. The creation of shared meaning.
In this age of empowerment, and in the same way that the Media must join the conversation, the vendors must join the bazaar.
A lot of talk lately about how page-views are dead.
Greg Yardley suggests a solution but it looks like he’s missing an important point.
It’s not just about widgets and “share” of the page, it’s the fact that a well-built Ajax application may now substitute a rich interface for what was tens or hundreds of page requests.
So now how do you calculate a CPM? By the number of clicks on a page? (I guess Ajax will report this data back to the server)
Are advertisers going to buy into the fact that a click that delivers new data to the page makes their ad on that page worth two impressions? Doubtful.
Do we need advertising engines that deliver ads in time based or action-based way so that one HTTP request can deliver more than one ad if the user is interacting with the page for an extended period? Maybe.
Or do we need to rethink advertising in general and admit that interruption based advertising is dead in general? I’d say so.
Which is why pay-per-click is so popular and why pay-per-action will continue to grow. No doubt.
By the way, it’s not just Ajax that’s causing this death of the page-view. It’s widgets, as Greg suggests, and RSS, and syndication of other sorts that make modern web marketing almost impossible to track effectively.
What can be tracked, as always, is the effectiveness of a campaign ROI, which methods like pay-per-action help immensely.
So what’s left to do in a pay-per-action world? Attention, Gestures and Intention are the gold that needs to be mined in order to create more effective marketing.
Using that gold will help us direct relevant offers to willing individuals. What could be better than that?
We can’t do it alone. CPM is one-way marketing, and one-way is dead in all things web.
That’s where VRM comes along. It stands for Vendor Relationship Management, and it refers to a new generation of tools on the way that allow the customers to assist in the marketing relationship.
Some will resist this loss of control at first, because what’s better for the customer doesn’t seem to equate to better for the vendor. But that’s wrong because the marketplace is not an equation, it’s a relationship.
A marriage doesn’t only get better for one of the spouses as the relationship grows stronger. It gets better for both.
Page views aren’t so dead as CPM is. Long live VRM.
Scott Anderson pointed me to Mark Cuban’s (you know I don’t subscribe to that crap 
) talk of local newspaper sales reps selling adsense and SEO wisdom. Cuban obviously doesn’t work at a newspaper.
Pure hogwash.
Here is what I commented on Scott Anderson’s (Onsquared.com) blog:
No way. Aint gonna happen.
IF (capital IF) the newspaper sales staff could be adequately trained to understand SEO and adsense style marketing, the amount of time it would take to explain, set up, and sell to a local shop for likely a fraction of what a print ad revenue would be. . .
It’s mixing oil and water.
News corporations should have been , and should still be, creating their own content, ad, and social networks (or buying them) and competing on the same playing field, not some hybrid one.
While it seems logical to want to leverage existing relationships and migrate them, unfortunately the web has changed how we need to relate with each other, especially businesses and their clients and customers.
I just don’t see web marketing in the future blending well with a sales rep sauntering into a local shop and saying ‘How do you do?’
In fact, the only reason why it has any level of success currently is because the perceived value of print ads is fogging the local advertisers vision of value on the web.
In the future, perceived value will be meaningless and actual value will be the only thing that matters.
Pay-per-click will evolve to pay-per-action. While pure branding has it’s place for some time to come, who can deny that Adsense singlehandedly changed the name of the game.
I told a Sales Manager once that pay-per-click was the future, and they laughed at me.
They wouldn’t laugh now, but they might if I told them pay-per-action was.
The other day I said Media was dead. Perhaps Advertising is dead.
From the BuzzMachine comments, in response to Hugh Macleod, I say:
Once you realize you can be disintermediated, it becomes clear that the old advertising model doesn’t work as well as it used to, so you find you must provide and extract value in another way.
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