Improving the online customer experience is top of the agenda for many marketers – except, perhaps, for the 40 per cent who are already using behavioural targeting.
Speaking at a recent Alterian event, Rebecca Jennings, senior analyst at Forrester, said that this figure marks the (small) proportion of marketers who have adopted techniques to optimise their online marketing. And with the Internet Advertising Bureau putting digital marketing spend at over £2bn for 2006, there is clearly a need to ensure the money is delivering the maximum return.
The issue is how to achieve that. Web analytics is at a crossroads that could determine whether marketing spend continues to go into more than just paid-for search. To continue to lay claim to marketing budgets, the panoply of online ad inventory needs to be able to prove what it can do.
That is why one in five marketers plan to invest in better Web analysis and optimisation tools in the next 12 months, with a similar number planning to do so more than a year hence, according to Forrester. Technology and data must be better aligned to marketers’ needs to sustain the current levels of activity.
What is driving this investment? “Behavioural targeting is justified by 18 per cent on the basis of increasing site traffic and by 45 per cent through linking it to transactions,” said Jennings. “Some 20 per cent say it is too early to tell. And 49 per cent want measurement of the tools before they adopt them.”
Behavioural targeting is still in its infancy and there are relatively few success stories to speak of. For some marketers, there is still confusion about what it means.
Lucy Stafford, media director at Tri-Direct, says: “The type of behavioural knowledge you need is dictated by the indication of someone’s propensity to buy your product. This could be via a previous interaction with an ad or piece of content that flags up need.”
She believes historical insight into propensity towards a product is one of the most powerful findings. In offline marketing, this is usually built up within client organisations over many years and by commercial data owners through a variety of measures.
“But it can take several weeks to establish a consumer’s pattern of behaviour. It may depend on the urgency and flexibility of the campaign how practical that information would be,” says Stafford.
Between online publishers, ad networks and media buyers, there is debate on how that pattern of behaviour should be tracked. Most systems rely on cookies or capturing an IP address. Both have flaws. “Neither is too relevant or important. So long as you can identify the mass of your audience behaviourally to bring about an improvement in results, it is sufficient,” says Stafford.
Publishers face a crucial decision as to how far to develop behavioural targeting. They can already report on paths taken by unique visitors and segment their proposition according to popularity, length of stay and where visitors go next. Advertisers want a broader insight, however. What a consumer does on an individual site only allows them to optimise their expenditure on that site. As most campaigns spend across a range of opportunities, there is much value in a common currency that tracks behaviour more widely over the Internet.
Donald Hamilton, managing director of behavioural targeting provider Wunderloop, says: “Marketing at any level is about finding an audience that is most likely to buy your product. That doesn’t mean it has to be in the ‘right’ context.” Behavioural targeting has the advantage of being able to place ads in front of potential buyers when they are on indirectly-related sites.
This is especially valuable for portals and broad interest sites, such as online newspapers. While they may have specific content that advertisers can buy, they also have a wide variety of landing pages where an ad might equally trigger interest in a product or service.
“There is no point targeting pages if you don’t know who’s going to be there. You have to know who the audience is or you will only get a response rate of 0.001 per cent. In any other area of marketing, that would not be acceptable,” says Hamilton.
It might have been assumed that clickstream data and Web analysis tools would have generated better targeting facilities early on. Yet, as Hamilton says: “In the digital space, there are lots of people running around who don’t understand what marketing is about.”
While advertisers and online networks struggle over how to improve targeting, software developers are taking steps that could introduce a new era of individual-level behavioural targeting. Through a process of consolidation, Web analytics and offline business intelligence tools are converging.
Online optimisation software house Omniture acquired behavioural targeting provider Touch Clarity in March and is integrating the two propositions. “There is increasing interest not just in us, but in the whole Web analytics space,” says Neil Weston, senior vice-president and general manager at Omniture.
He believes existing Web analysis systems have offered weak data mining and simplistic reporting. “You can’t assess anything with them,” says Weston. He believes the fusion of business intelligence and Web analytics will deliver the “single version of the truth” about online activity that clients want.
Omniture already integrates data from 30 partners and aims to build that to over 100. Since each email broadcaster, ad serving network and Web publisher operates on a different data model, optimising multi-stream campaigns has previously been a nightmare.
“Touch Clarity is oriented to individual-level marketing. Where some people are segmenting users and offering demographics to marketers, behavioural targeting builds a knowledge base of every individual transaction the user has. It stores those and develops a profile of their characteristics,” says Weston.
Where this has been used to optimise online advertising, campaign performance has improved by 20 to 100 per cent, claims Weston. “Touch Clarity fills in one of the components of online optimisation,” he says.
Another acquisition has been by Visual Sciences of WebSideStory. The combination of data visualisation tools with Web analytics is intended to provide a new benchmark, not least in the ability to process the terabytes of data that clickstreams can rapidly generate.
“We’re providing a real time analytics platform that can scale up to the Web and is also usable for other channels. That is where we see the market going,” says Simon Gibbaud, business development manager at Visual Sciences.?“Multi-channel organisations are looking at the Web as strategic – most of their customers are now coming through the Web. They are using it as part of their core business. That places a burden on Web analysts,” he says.?Firms want answers to key questions, such as which page is most popular. But they want to drill into why that might be the case. “Web analytics has been very good at answering what happened. ‘Why’ is more difficult and questions are often unplanned,” says Gibbaud.
The volume of data generated by websites makes processing complex queries a challenge. Applications have used conventional relational databases to deliver table-based reports. Visual Sciences adopts a radically different approach, which yields more dynamic outputs of the sort marketers expect to see from offline data. “The interface is designed for business users, not hardcore analysts. It allows train of thought analysis,” says Gibbaud.
None of this technology is of value unless it is actively deployed by marketers. There needs to be a cultural shift that recognises online advertising as integral to the business.
Broadsystem chief executive Caroline Worboys says: “Customer data capture has never been so crucial. The insights drawn from customer data can shape an entire communications strategy and are key to its effectiveness.”
She adds: “Pushing the most relevant advertising and content to Web users is a giant leap forward and will serve to benefit our industry. But rather than pushing content, it is becoming increasingly important to allow customers to set their own agenda and pull the content they want. Not only is this true consumer choice, but also reaps even better returns.”?She cites The Times and Sunday Times weekly email newsletters. Content is based on recipients’ preferences.
Subscribers create their own profile via the Times website, ensuring the newsletter is as relevant and interesting as possible. Content is dynamic and evolves around how the customer behaves and interacts with the newspaper, both on and offline.
“This makes it possible for every email to be unique and personally tailored to meet the needs and wants of users. From the customer data gathered, it is possible to create a customer journey map and analyse the user’s behaviour to inform communication programmes, such as driving sales, engendering loyalty, or promoting a certain service and future acquisition activity,” says Worboys.
Few advertisers have integrated their digital activity in this way. To sustain the levels of investment in online advertising, many more will have to. In doing so, they will be demanding individual-level behavioural targeting.?Worboys summarises: “IP addresses and identified unique users are most certainly useful. However, there is nothing quite like individual data. It is this move towards individualisation that will deliver greater cut-through and results.”
Monday, 18 June 2007
Monday, 11 June 2007
The Un-siloing of media
Extract by Rebecca Lieb June 08, 2007
Interactive media certainly has its share of vertical channels when it comes to marketing and advertising. There's search, display, video, classifieds, local, social media, e-mail, syndication -- the list goes on.
Traditional media has its own buckets: print is divided into magazines and newspapers. Broadcast has cable and network. There's radio, outdoor, direct, and a panoply of other channels.
With all those options, advertising agencies tend to specialize. The bigger shops have internal divisions specializing in buying and creating campaigns for different channels across different media.
And now, all these disparate channels and specialties are turning into a great, big jumbled blur. Blame the Web.
Google announced Google Audio Ads late last year and solidified the offering with its recent pact with Clear Channel Radio. The search giant is selling :30 spots on 675 of Clear Channel's AM/FM stations, including major markets such as Los Angeles and New York. That's the beginning of a serious business model -- one that traditionally resides in the offline-only world. Of course, Google's also dabbling in print and television advertising.
Another search giant, eBay (I'm not making this up -- company execs call what you may think is an auction marketplace "the biggest shopping search engine") has embarked on its own broadcast advertising brokering. EBay's Media Marketplace will auction airtime on 2,300 radio stations. On the payment front, eBay's PayPal is going head-to-head with Google Checkout.
It's not just online companies going after a slice of offline media. The inverse is occurring, too. Examples are particularly rife in television broadcasting. International cable powerhouse CNN recently acquired a stake in local TV network Internet Broadcasting, which, among other things, will place locally oriented ads on the global broadcaster's Web properties. CBS, meanwhile, is distributing its video content on Yahoo, for which Yahoo will sell the ads.
Speaking of Yahoo, that company forged another solid offline alliance last fall with major newspaper publishers, including Belo, Cox Enterprises, E.W. Scripps, the Journal Register Company, Lee Enterprises, and Morris Publishing, as well as Hearst, which has also partnered with Google to run its text ads in its print publications. The ranks have now swelled to 17 publishers, accounting for 400 dailies and a handful of weekly publications. Hearst is now building a sales center in Houston devoted to selling and promoting Yahoo's HotJob products. Yahoo also expects to start selling display ads on these newspapers' sites sometime next year.
A New Definition of Media Agency
Magazine publishers, meanwhile, are now in the agency business. A "New York Times" article earlier this week profiled a number of publishers, including Condé Nast, the Meredith Corporation, Reader's Digest, Hearst, and even indie "Surface" magazine, that have established creative agencies, either internally or as separate business units. These shops are handling creative; media, including print, online, video, mobile, and outdoor; and events and research. There's even occasional overlap into radio and TV, according to the article, as well as alliances that have "created some unusual partnerships (think of Vogue designing ads for Wal-Mart Stores)."
Clients are top tier: Chevrolet, Citigroup, L'Oréal, Cingular, Dillard's, Kohl's, Grey Goose, and Lexus. Their media agencies are watching, doubtless with a measure of alarm. "We don't have to make money from our creative, because we make money from our media," the head of the Condé Nast group was quoted as saying.
Advertiser reliance on media buying agencies might wane slightly in light of such developments as in-house media agencies, as well as the long-running roll-your-own media trend. American Express, a leader in this space, announced another new ad initiative this week that will result in minimal media buys -- online, at least. Even Microsoft seems to be realizing the cross-promotional potential of its own media holdings.
If you're a marketer or an advertiser, heed closely these developments in the media and creative landscape. No matter your size or scale, your horizons are broadening. You may be media and not even know it. You may be able to scale up to buying media you previously thought was unattainable due to budget or agency constrictions. The boundaries that once constrained your efforts are becoming porous indeed.
Interactive media certainly has its share of vertical channels when it comes to marketing and advertising. There's search, display, video, classifieds, local, social media, e-mail, syndication -- the list goes on.
Traditional media has its own buckets: print is divided into magazines and newspapers. Broadcast has cable and network. There's radio, outdoor, direct, and a panoply of other channels.
With all those options, advertising agencies tend to specialize. The bigger shops have internal divisions specializing in buying and creating campaigns for different channels across different media.
And now, all these disparate channels and specialties are turning into a great, big jumbled blur. Blame the Web.
Google announced Google Audio Ads late last year and solidified the offering with its recent pact with Clear Channel Radio. The search giant is selling :30 spots on 675 of Clear Channel's AM/FM stations, including major markets such as Los Angeles and New York. That's the beginning of a serious business model -- one that traditionally resides in the offline-only world. Of course, Google's also dabbling in print and television advertising.
Another search giant, eBay (I'm not making this up -- company execs call what you may think is an auction marketplace "the biggest shopping search engine") has embarked on its own broadcast advertising brokering. EBay's Media Marketplace will auction airtime on 2,300 radio stations. On the payment front, eBay's PayPal is going head-to-head with Google Checkout.
It's not just online companies going after a slice of offline media. The inverse is occurring, too. Examples are particularly rife in television broadcasting. International cable powerhouse CNN recently acquired a stake in local TV network Internet Broadcasting, which, among other things, will place locally oriented ads on the global broadcaster's Web properties. CBS, meanwhile, is distributing its video content on Yahoo, for which Yahoo will sell the ads.
Speaking of Yahoo, that company forged another solid offline alliance last fall with major newspaper publishers, including Belo, Cox Enterprises, E.W. Scripps, the Journal Register Company, Lee Enterprises, and Morris Publishing, as well as Hearst, which has also partnered with Google to run its text ads in its print publications. The ranks have now swelled to 17 publishers, accounting for 400 dailies and a handful of weekly publications. Hearst is now building a sales center in Houston devoted to selling and promoting Yahoo's HotJob products. Yahoo also expects to start selling display ads on these newspapers' sites sometime next year.
A New Definition of Media Agency
Magazine publishers, meanwhile, are now in the agency business. A "New York Times" article earlier this week profiled a number of publishers, including Condé Nast, the Meredith Corporation, Reader's Digest, Hearst, and even indie "Surface" magazine, that have established creative agencies, either internally or as separate business units. These shops are handling creative; media, including print, online, video, mobile, and outdoor; and events and research. There's even occasional overlap into radio and TV, according to the article, as well as alliances that have "created some unusual partnerships (think of Vogue designing ads for Wal-Mart Stores)."
Clients are top tier: Chevrolet, Citigroup, L'Oréal, Cingular, Dillard's, Kohl's, Grey Goose, and Lexus. Their media agencies are watching, doubtless with a measure of alarm. "We don't have to make money from our creative, because we make money from our media," the head of the Condé Nast group was quoted as saying.
Advertiser reliance on media buying agencies might wane slightly in light of such developments as in-house media agencies, as well as the long-running roll-your-own media trend. American Express, a leader in this space, announced another new ad initiative this week that will result in minimal media buys -- online, at least. Even Microsoft seems to be realizing the cross-promotional potential of its own media holdings.
If you're a marketer or an advertiser, heed closely these developments in the media and creative landscape. No matter your size or scale, your horizons are broadening. You may be media and not even know it. You may be able to scale up to buying media you previously thought was unattainable due to budget or agency constrictions. The boundaries that once constrained your efforts are becoming porous indeed.
Wednesday, 6 June 2007
Online display advertising
Thanks Jo
How online display advertising influences search volumes
Published: 04 June 2007
Mike Teasdale, Planning Director at online marketing agency Harvest Digital discusses the connections between online display activity and search and reveals some interesting consumer trends.
A recent Atlas survey on the ‘halo effect’ between display and search discovered an average uplift on conversion rates of 22 per cent on searchers who had recently been exposed to a display advertisement from the same company.
Research using adserving data like this has the advantage of using massive amounts of customer data across different companies, but there are some issues with the accuracy of the data – for example, cookie deletion by users can skew the results.
So we turned to primary research with consumers to ask them directly whether display advertising influenced their subsequent searching behaviour.
We ran a survey in conjunction with Adviva, the leading advertising network, to assess attitudes to online travel purchasing. Research was conducted and compiled by Nielsen//NetRatings with over 900 respondents.
Research findings
Respondents were asked whether they would click on an ad, do a search or go directly to the advertiser’s website if they saw an online advertisement.
We expected clicking on a banner to be the most popular option – but surprisingly only 26 per cent of our sample said that they would click on a banner to respond.
In fact search was the most popular option. This was split between searches for the advertiser’s name (26per cent) or for a general term relating to the advertisement (31per cent). So more than twice as many people are being driven to a search engine by banner advertising than by clicking directly on the banner!
Retail channels also benefit, with 4 per cent claiming they would visit a high street store having seen a banner.
What’s going on here?
At first, these findings seem counter-intuitive – after all, what could be easier than clicking on a banner?
Much web activity is task-driven. How much is that flight? What’s the weather like in Hull? Clicking on a banner distracts from the completion of a task, people tend to follow up on the advertisement afterwards. Many consumers seem to be treating the activity more like posters or TV.
Implications of this research
One key implication is in how we judge the effectiveness of online activity. Focusing on the last click before a transaction will often rate search marketing as the most cost-effective channel, underestimating the part display advertising plays.
Alex Burmaster, European Internet Analyst at Nielsen/NetRatings observes, "The unrivalled ability of the Internet to provide marketers with detailed information on direct user response to online ads often means the whole story is ignored. Our research highlights how 'click-through-tunnel-vision' ignores the larger or delayed impact that the ad can have on viewer behaviour or perception. After all, you don't just measure the success of a poster by how many people buy the product advertised from the nearest shop."
Todd Treusdell, CEO at Adviva comments: “Display activity gives clients the opportunity to reach large numbers of internet users at a relatively low cost. It’s important to appreciate (as this research underlines) that direct clicks are only one way that the advertising is working. Consumers are also doing searches, going directly to your web site and even visiting your retail store – all prompted by an online advertising campaign.”
The importance of an integrated approach to search and display
The most striking finding is how many searches are being prompted by online display activity.
Unfortunately for brand owners, the research suggests that more searches are going to generic terms like “package holiday Cyprus” than to the brand itself.
Search needs to be optimised to work with banner advertising, by anticipating searches that are likely to be prompted by the banner and ensure a higher rank for search results.
Although the speed and accuracy digital marketing enjoys is the envy of other marketing channels, the numbers do not always give a true indication.
Just as online is influenced by activity in offline channels, different online channels also seem to have a profound influence on each other.
This research strongly suggests that measuring display activity by CTR alone underestimates the impact of that activity. For every click on a banner, our research implies at least two related searches and a further direct visit to the advertiser’s web site.
Research on the Adviva network conducted by Nielsen/Netratings
How online display advertising influences search volumes
Published: 04 June 2007
Mike Teasdale, Planning Director at online marketing agency Harvest Digital discusses the connections between online display activity and search and reveals some interesting consumer trends.
A recent Atlas survey on the ‘halo effect’ between display and search discovered an average uplift on conversion rates of 22 per cent on searchers who had recently been exposed to a display advertisement from the same company.
Research using adserving data like this has the advantage of using massive amounts of customer data across different companies, but there are some issues with the accuracy of the data – for example, cookie deletion by users can skew the results.
So we turned to primary research with consumers to ask them directly whether display advertising influenced their subsequent searching behaviour.
We ran a survey in conjunction with Adviva, the leading advertising network, to assess attitudes to online travel purchasing. Research was conducted and compiled by Nielsen//NetRatings with over 900 respondents.
Research findings
Respondents were asked whether they would click on an ad, do a search or go directly to the advertiser’s website if they saw an online advertisement.
We expected clicking on a banner to be the most popular option – but surprisingly only 26 per cent of our sample said that they would click on a banner to respond.
In fact search was the most popular option. This was split between searches for the advertiser’s name (26per cent) or for a general term relating to the advertisement (31per cent). So more than twice as many people are being driven to a search engine by banner advertising than by clicking directly on the banner!
Retail channels also benefit, with 4 per cent claiming they would visit a high street store having seen a banner.
What’s going on here?
At first, these findings seem counter-intuitive – after all, what could be easier than clicking on a banner?
Much web activity is task-driven. How much is that flight? What’s the weather like in Hull? Clicking on a banner distracts from the completion of a task, people tend to follow up on the advertisement afterwards. Many consumers seem to be treating the activity more like posters or TV.
Implications of this research
One key implication is in how we judge the effectiveness of online activity. Focusing on the last click before a transaction will often rate search marketing as the most cost-effective channel, underestimating the part display advertising plays.
Alex Burmaster, European Internet Analyst at Nielsen/NetRatings observes, "The unrivalled ability of the Internet to provide marketers with detailed information on direct user response to online ads often means the whole story is ignored. Our research highlights how 'click-through-tunnel-vision' ignores the larger or delayed impact that the ad can have on viewer behaviour or perception. After all, you don't just measure the success of a poster by how many people buy the product advertised from the nearest shop."
Todd Treusdell, CEO at Adviva comments: “Display activity gives clients the opportunity to reach large numbers of internet users at a relatively low cost. It’s important to appreciate (as this research underlines) that direct clicks are only one way that the advertising is working. Consumers are also doing searches, going directly to your web site and even visiting your retail store – all prompted by an online advertising campaign.”
The importance of an integrated approach to search and display
The most striking finding is how many searches are being prompted by online display activity.
Unfortunately for brand owners, the research suggests that more searches are going to generic terms like “package holiday Cyprus” than to the brand itself.
Search needs to be optimised to work with banner advertising, by anticipating searches that are likely to be prompted by the banner and ensure a higher rank for search results.
Although the speed and accuracy digital marketing enjoys is the envy of other marketing channels, the numbers do not always give a true indication.
Just as online is influenced by activity in offline channels, different online channels also seem to have a profound influence on each other.
This research strongly suggests that measuring display activity by CTR alone underestimates the impact of that activity. For every click on a banner, our research implies at least two related searches and a further direct visit to the advertiser’s web site.
Research on the Adviva network conducted by Nielsen/Netratings
Friday, 1 June 2007
D&AD - President's lecture and forum - Wieden Kennedy
I recently attended a D&AD president's Dan Wieden and David Kennedy. Spiel from the D&AD site is as follows:
'Wieden + Kennedy, the world’s only independent, creatively-led global agency network, was founded in Portland, Oregon on April Fools’ day 1982 by creative partners Dan Wieden and David Kennedy. For the last 25 years W+K have produced award winning creative work for an array of leading brands including their founding client Nike, Microsoft, Coca Cola and Honda to name a few. A hugely successful global company, they now have offices in Portland, New York, Amsterdam, London, Tokyo and Shanghai.
W+K specialises in building strong and provocative relationships between good companies and their customers. They cite their strength derives from the fact that the agency is still 100% independently owned and run by creative people. This has drawnin a diversity of talent from around the world.
Dan Wieden and David Kennedy will be discussing the germination of their success, reviewing the stand-out work from the agency’s 25 year history, and talking about what the future holds.'
Whilst there wasn't too much about the future, (mostly a light hearted look back at times when our industry was a lot more fun), their presentation did highlight a few learnings for me.
The first is that if you sorround yourself with interesting people, who care about stuff, and bring their passion to each project, you will produce exciting work.
The second is that few things are original, but there are lots of things you can put together to make something new.
The last thing I took away is that you should always try to enjoy it. Creating great work and inspiring creative should be fun. It might sound a little cheesy, but looking at these guys on stage, I got the feeling that, whether easy of hard, they filled their time with doing stuff that they thought was a laugh.
'Wieden + Kennedy, the world’s only independent, creatively-led global agency network, was founded in Portland, Oregon on April Fools’ day 1982 by creative partners Dan Wieden and David Kennedy. For the last 25 years W+K have produced award winning creative work for an array of leading brands including their founding client Nike, Microsoft, Coca Cola and Honda to name a few. A hugely successful global company, they now have offices in Portland, New York, Amsterdam, London, Tokyo and Shanghai.
W+K specialises in building strong and provocative relationships between good companies and their customers. They cite their strength derives from the fact that the agency is still 100% independently owned and run by creative people. This has drawnin a diversity of talent from around the world.
Dan Wieden and David Kennedy will be discussing the germination of their success, reviewing the stand-out work from the agency’s 25 year history, and talking about what the future holds.'
Whilst there wasn't too much about the future, (mostly a light hearted look back at times when our industry was a lot more fun), their presentation did highlight a few learnings for me.
The first is that if you sorround yourself with interesting people, who care about stuff, and bring their passion to each project, you will produce exciting work.
The second is that few things are original, but there are lots of things you can put together to make something new.
The last thing I took away is that you should always try to enjoy it. Creating great work and inspiring creative should be fun. It might sound a little cheesy, but looking at these guys on stage, I got the feeling that, whether easy of hard, they filled their time with doing stuff that they thought was a laugh.
Influencing the influencers online
Exztract from How Do You Influence the Influencers? What's The Buzz? BY Rebecca LiebJune 01, 2007
For a couple years now, Yahoo has been presenting original research at a roving event for advertisers dubbed the Summit Series. The company has been commissioning original research on topics such as online demographics, Web use, ad creative, and such online consumer behavior as shopping and the purchase consideration cycle.
"We're spending millions commissioning this research," a Yahoo ad exec noted at a reception following the presentation of the latest study in the series. "I hope it's helping sales."
An understandable sentiment, but regarding this most recent study, "Engaging Advocates through Search and Social Media," I have some reservations that it is.
(By the way, yesterday DoubleClick released some very similar and corroborative research: "Influencing the Influencers: How Online Advertising and Media Impact Word of Mouth.")
The results of this, and other studies Yahoo has recently conducted, underscore that all this stuff is mightily complicated, even for professionals immersed in the world of interactive marketing and advertising. Yahoo's New York audience wasn't composed of the digerati. Grasping the significance of online advocates might have been more than a bit over the heads of many in the agency and client-side audience Yahoo assembled for the presentation.
As Michele Madansky, Yahoo's VP of corporate sales and research, was quick to point out, the advocate/influencer concept is as old as humanity itself. That people influence other people to buy and do stuff is hardly groundbreaking. But amplify these influencers through Web channels, and the influence equation suddenly becomes very complex indeed. Search, blogs, online video, IM, community forums, user groups, photo- and video-sharing sites, and social networks all form part of an equation that channels the "billions of dollars being moved by consumer advocates," as comScore's James Lamberti (who conducted part of the study) put it.
The qualitative portion of the research wasn't particularly revelatory. Word-of-mouth (WOM) marketing has been more than prominent recently. This has given rise to the formation of the Word of Mouth Marketing Association (WOMMA), companies such as Nielsen BuzzMetrics and Cymfony to measure WOM, and shops like BzzAgent that purport to create it. It's gotten so big, even the FTC is paying attention.
Yahoo's study is of interest because of some interesting quantifiable data it presents. It found, for example, advocates have a 2:1 conversion impact across categories. In plain English, that means the researchers found an advocate talking up the virtues of her new car had at least one friend make the same purchase, to the tune of $718,000 in sales. A similarly satisfied non-advocate was responsible for only $502,000 in additional conversions. In consumer electronics, the numbers are even more staggering. For purchases over $300, advocates moved an additional $1.6 million of merchandise, compared to $570,000 attributed to their less vocal, less influential peers.
Advocates also tend to embrace consumer-generated media more than their peers, often to online retailers' advantage. When CompUSA integrated Bazaarvoice's consumer reviews into its product pages, the company quickly found its conversion rate was 60 percent higher for keywords such as "sony review" compared to its more conventional paid search ads. Given advocates review and search more, the results make sense.
Showcased were a handful of successful campaigns tied into the search and social media sites where advocates spend their time. Nikon on Yahoo-owned Flickr, for example, makes a whole bunch of sense. Honda building a MySpace page for a crab is less obvious, and, anyway, it's tied into a long-running, multichannel existing campaign. Similarly, Travelocity scored a top ranking on Yahoo for the not-terribly-expensive keyword, "gnome." But again, Travelocity's been tied to the roving garden gnome for years.
For a couple years now, Yahoo has been presenting original research at a roving event for advertisers dubbed the Summit Series. The company has been commissioning original research on topics such as online demographics, Web use, ad creative, and such online consumer behavior as shopping and the purchase consideration cycle.
"We're spending millions commissioning this research," a Yahoo ad exec noted at a reception following the presentation of the latest study in the series. "I hope it's helping sales."
An understandable sentiment, but regarding this most recent study, "Engaging Advocates through Search and Social Media," I have some reservations that it is.
(By the way, yesterday DoubleClick released some very similar and corroborative research: "Influencing the Influencers: How Online Advertising and Media Impact Word of Mouth.")
The results of this, and other studies Yahoo has recently conducted, underscore that all this stuff is mightily complicated, even for professionals immersed in the world of interactive marketing and advertising. Yahoo's New York audience wasn't composed of the digerati. Grasping the significance of online advocates might have been more than a bit over the heads of many in the agency and client-side audience Yahoo assembled for the presentation.
As Michele Madansky, Yahoo's VP of corporate sales and research, was quick to point out, the advocate/influencer concept is as old as humanity itself. That people influence other people to buy and do stuff is hardly groundbreaking. But amplify these influencers through Web channels, and the influence equation suddenly becomes very complex indeed. Search, blogs, online video, IM, community forums, user groups, photo- and video-sharing sites, and social networks all form part of an equation that channels the "billions of dollars being moved by consumer advocates," as comScore's James Lamberti (who conducted part of the study) put it.
The qualitative portion of the research wasn't particularly revelatory. Word-of-mouth (WOM) marketing has been more than prominent recently. This has given rise to the formation of the Word of Mouth Marketing Association (WOMMA), companies such as Nielsen BuzzMetrics and Cymfony to measure WOM, and shops like BzzAgent that purport to create it. It's gotten so big, even the FTC is paying attention.
Yahoo's study is of interest because of some interesting quantifiable data it presents. It found, for example, advocates have a 2:1 conversion impact across categories. In plain English, that means the researchers found an advocate talking up the virtues of her new car had at least one friend make the same purchase, to the tune of $718,000 in sales. A similarly satisfied non-advocate was responsible for only $502,000 in additional conversions. In consumer electronics, the numbers are even more staggering. For purchases over $300, advocates moved an additional $1.6 million of merchandise, compared to $570,000 attributed to their less vocal, less influential peers.
Advocates also tend to embrace consumer-generated media more than their peers, often to online retailers' advantage. When CompUSA integrated Bazaarvoice's consumer reviews into its product pages, the company quickly found its conversion rate was 60 percent higher for keywords such as "sony review" compared to its more conventional paid search ads. Given advocates review and search more, the results make sense.
Showcased were a handful of successful campaigns tied into the search and social media sites where advocates spend their time. Nikon on Yahoo-owned Flickr, for example, makes a whole bunch of sense. Honda building a MySpace page for a crab is less obvious, and, anyway, it's tied into a long-running, multichannel existing campaign. Similarly, Travelocity scored a top ranking on Yahoo for the not-terribly-expensive keyword, "gnome." But again, Travelocity's been tied to the roving garden gnome for years.
Indeed, these case studies highlight what works well in advocates' very social online spaces: major brands teamed with solidly integrated creative agencies. All have track records and spend considerable media and creative dollars in other channels, both online and off-.
What of other marketers hoping to capitalize on such a vast and amorphous world of media and creative? What if you're a B2B advertiser or a lesser-known brand?
Those were questions the audience was posing, but Yahoo and the panel of experts it assembled weren't able to satisfactorily answer.
Yahoo's reaching for those big brand advertisers, to be sure. But when the top sales executive expressed concern that the company's research and attendant events may not be achieving the desired ROI (define) for the company, I could see his point.
Yahoo isn't misrepresenting the online landscape, to be sure. Instead, it's laying bare all its complexity and confusion. It's marketing to an audience of marketers who are looking at the portal to provide answers. What it may be creating instead are many more questions.
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