Yahoo Shareholder Presentation...

Here's an excellent summary of the Yahoo!-Microsoft saga (Question #1 from the Final!) and the subsequent Icahn related mumbo-jumbo.

the Yahoo! Investor Presentation at the SEC

Business in Second Life

At Silicon.com there was a post related to what we saw in class yesterday - business in Second Life. They say that

Business[es are] still experimenting in Second Life but confusion over measuring virtual world success.

I am also curious how they will measure the success or failure of advertising/marketing on Second Life. They have virtual compnay islands, so they might count visits to their islands, but it would be difficult to see if it leads to actual purchase. Since many businesses have been in Second Life for a while, they must believe there is a positive effect. Or as the article says:

Businesses are unsure about the benefits of using Second Life with many still just experimenting with the virtual world to discover its true value.

The companies may still be experimenting with the presence on a virtual world. If it works, Second Life may expect to earn a lot from advertising from eager advertisers to join the virtual advertising.

Click Fraud still a problem!

Tech Crunch Blog brings new stats about the amount of click fraud going on the net these days. Click fraud is when black hat practitioners set up a fake site with Google or Yahoo's content networks and then hire people or have a robot sit and click on the advertisements on their site. This way the publisher makes a lot of money off click through that do not bring any profit to the advertisers. Google or Yahoo will still make a their profit any way. Some advertisers say they loose over 30% of their advertisements on click fraud. Click Forensics is reporting a decrease of around a half a percent and Tech Crunch claims that might show that Google and Yahoo are finally doing more to stop this kind of fraud. For the time being it is too early to tell where this is going.

Playing David

A little inspiration might be just the thing during these disheartening times. The economic downturn has marketers breaking out innovations to get through the recession. Some smaller players, in particular, provide inspiration on how to do more with less.

Advertising Age focuses on the little guy, the Davids of the marketing world who outsling the giants, those with hefty R&D budgets, TV campaigns and free shipping. Adage offers up a list of how to make marketing money work harder.

1. Denial is a good thing – Instead of cutting your media spend by 10%, what if you slashed it by 100% instead and forced yourself to look for alternative forms of media
2. Pick a Fight – Challengers get people to pay attention to them by strategically picking fights
3. It Pays to Hate – It can be useful to pick an enemy, if only for the attention it will get you
4. Take it Personally – Successful challengers are nearly always invested with a very personal sense of mission

AdAge suggests the economic uncertainty should inspire all marketers to adopt a 'challenger' mentality. That message extends beyond the marketing industry. “Only the paranoid survive.”

Shooting the Advertiser

Mark Cuban never veers too far from controversy. The chairman of HDNet and Dallas Mavericks owner calls ‘em as he sees ‘em on his widely-read Blog Maverick. Now, he’s taking aim at advertisers who, he suggests, “shoot themselves in their collective feet.”

Cuban notes the advertiser’s central challenge: getting people to watch their commercials. He asks why advertisers don’t take advantage of available technology to avoid having television viewers turn away from the commercial break.

“Why in the world do advertisers JACK UP THE VOLUME OF THEIR COMMERCIALS?” he asks. “WHY ARE ADVERTISERS SO STUPID?”

Apparently, Cuban finds this as aggravating as the rest of us.

Gentlemen start your engines...

Is the race on to find the standard-bearer for Web 3.0? With many expecting localization to play a big role in the next life-cycle of the internet, today was a big step towards bringing social networking through mobile apps to the masses. Buzzd, one such social network, announced venture funding by Greycroft Partners (also shareholders of paidcontent.org) and Monitor Ventures for an undisclosed sum (http://www.paidcontent.org/entry/419-buzzd-raises-first-round-for-location-based-mobile-networking/). The article also mentions one of their competitors, Loopt, who's got a great elevator pitch on their web-site: "loopt turns your mobile phone into a social compass".

I checked out the Buzzd tutorial on their web-site, and it's basically twitter with a dose of facebook but branded for big city night-life. I'm pretty sure you can manage your account online, posting personal details and linking up with friends, etc. The idea is that you can send Buzzd an SMS right before you go out, and the service will return with a text that displays recommended venues/parties for the night. At some point a WAP site even opens up, so it's rich media. When you get there, you can send one text to Buzzd, letting your community know that you're there, and everyone in your network will be notified.

I "get" the model, but it just sounds like a heckuva lot of work. Usually you're not going to meet people you barely know, right? Some, if not most, people have group lists on their phones that they can SMS in one shot. You agree to a bar beforehand, and then send out the obligatory mass text asking, "Where R U?". One point of differentiation between these mobile social networks seems to be the partnerships they strikeup. Buzzd seems to have Cityseach and TimeOutNY locked up, while Loopt has Facebook. Interesting to see what the tipping point will be with this technology. I'm much more interested if someone in my network has found a cool, unknown bar with no annoying people around. I'd almost pay for that...

"Olay for You" is a Success in Providing Personalized Online Product Recommendations

Proctor & Gamble started a digital initiative back in January called Olay for You, which has proven to be extremely successful. Olay for You is an online product recommendation system. It was developed because of the proliferation of Olay products, and confusion among consumers new to the brand in regard to what each product does and what products they need.

Olay for You uses a very graphic, iterative interview process and a soothing female voice in order to "interview" users and get them to answer numerous questions in order to be able to recommend products to them.

Consumers are increasingly finding the offline shopping experience to be annoying, especially when they aren't sure what product to by or can't find the product they're looking for. As a result, retailers want to tap inot the convenience and functionality of online tools. Wal-Mart is an example of this. Wal-Mart has now begun testing an in-store version of Olay for You via in-store kiosks.

It's very interesting how the shopping experience in big box stores has come full circle. Online shopping used to be thought of as lacking the "warmth" of in-store shopping. However, with the proliferation of large stores and the lack of sales personnel to help the shopper, the online experience is now becoming more pleasant. Online, a shopper can find the information she needs, and with the advent of initiatives such as Olay for You, can even obtain personalized product recommendations. Now stores are trying to mimic the advantages of online shopping. Who would have thought that would ever happen?

Article: http://adage.com/digital/article?article_id=126543

BBC Looking into Buying Out Virgin Media

Large media conglomerates continue to change dancing partners. This time it's happening across the pond. On Monday of this week (April 21), the Wall Street Journal reported that the BBC is looking for a private equity firm to help it buy out its partner Virgin Media. It is not clear if the rest of Virgin Media's TV portfolio will be part of this deal, which is referred to as the UKTV venture. UKTV has many older British shows that are very popular, such as Fawlty Towers, and also controls several channels such as UKTV Style, UKTV Food, and UKTV History. If the deal goes through, BBC Worldwide would own a majority stake in UKTV, and plans to launch numerous channels around the world in an effort to increase its profits to about $400 million. The deal would also help Virgin Media reduce some of its large debt. About 10 PE firms have submited bids to paricipate with the BBC in the buyout, including U.S. based Providence Equity Partners.

Company Using Virtual World to Train Employees

One company is using a Second Life-type of virutal world to train their employees. Silicon Image, a chip manufacturer, has a virtual world that represents its corporate campus and allows employees to interact with each other using 3-dimensional characters. Videos and slideshows are available within this virtual world, which supplement live classroom training. Employees can move through this virtual world, enter different departments, and play videos to learn more about what is done in that department.

This may seem a little strange to us, but Silicon Image says this keeps employees interested in learning. The technology isn't cheap - virtual world training usually costs $60,000-$300,000 to set up. However, since Silicon Image is an early adopter, they received a speical discount.

It's hard to imagine being trained in a virtual environment. I think I prefer the real-life version. But it will be interesting to see if and how fast this catches on. I think that as Second Life becomes more popular and mainstream, we will see the ramifications of this in other areas, including more companies engaging in corporate virtual training.

Artricle:
http://online.wsj.com/article/SB120717370600584599.html?mod=todays_us_marketplace

Combining Digital Media Sharing with Online Chat

Photophlow and Videophlow, two new services being offered soon by Oortle, combine the social aspect of the internet with user generated content. Photophlow allows a group of users to all view and scroll through a flickr album together, so that they are seeing the same image at the same time and able to discuss it in real time. Videophlow is the exact same concept, but centered around videos on YouTube. I think a program like this has the potential increase the sense of community that already exists around user generated content. While it's sure to be used for plenty of mindless commentary (as YouTube commenters have shown), it also has the potential to promote ongoing critical discussions about content.
These are the latest in a long string of applications being developed that take advantage of preexisting websites and builds on their infrastructure. A natural next step seems to be to turn this into a Facebook application so that it becomes easy to find and invite your friends to watch videos with you.

Source: TechCrunch

Aaaaaaction!

In what I consider a brilliant move ahead of other cellphone manufacturers, Finnish based Nokia is using the populist appeal of user generated content, the shift of social networking from the Web to cellphones and the pedigree of a famous film director, Spike Lee, to position its mobile devices as entertainment friendly.
The company has said that last year it surveyed 9000 consumers and concluded that 1 out of 4 consumers will create, edit or share entertainment with friends, instead of getting it from traditional outlets like television.

For this project with a theme on humanity, contributors will upload their materials (video, music, photos, text) created with their mobile devices to a Nokia website-- www.nokiaproductions.com. Mr. Lee and a group of assistant directors will revise the entries, choose and put the film together. There will also be a blog where he gives young filmmakers advice.
The film will be viewable online, but Nokia still has to negotiate what cellphone service carriers will distribute the film on its mobile devices.

Seriously, I just can't think how Mr. Lee will be able to manage with all the entries, producing the film and the blog(perhaps lots of assistant directors). Anyhow, I am interested in seeing the final outcome.

Orbitz experiments with traveler networking

I was traveling recently and noticed some Orbitz advertisements highlighting a new feature that seems aimed to compete with the Travel 2.o stylings of websites like tripadvisor.com. Orbitz currently has its feature out in beta, it's called Traveler Update, and it attempts to use user-generated travel feedback to deliver real time updates through the Orbitz network of travelers. Essentially, it seems that travelers will send updates about airport conditions and Orbitz will forward this information to other travelers who might find it relevant (i.e. others who are traveling to/from that same airport at around the same time). The feature is billed on the website as:

Stay a step ahead with real-time updates from travelers just like you.

Ensure your trip goes smoothly with real-time updates from fellow travelers about security wait times, traffic & parking, taxi lines and more. Additionally, our exclusive OrbitzTLC air-traffic info, FAA updates, and weather conditions will keep your travels on track!

Additionally, to incentivize honest reporting, Orbitz will offer rewards to those who consistently provide helpful information.

Orbitz will rate users based on how often they comment and how useful their comments are, offering discounts and free flights to those with the highest ratings — no indication yet exactly how such bounties will be measured or doled out.
(see: gridskipper)

Given the relative trust that users seem to grant to user-generated feedback, this seems like an innovative step for Orbitz. The site already sends out text/phone updates, and it is encouraging that it is using its database to connect users who may have relevant information to provide to one another.

This seems particularly interesting too because users don't have to seek out the user-generated feedback... instead Orbitz feeds them relevant reports based on information it already has stored in its database. In essence Orbitz is creating a ready-made travelers network, without requiring the traveler to explicitly join or explore the network themselves. By harnessing the power of social networking to connect travelers and integrating information from its own databse, it seems Orbitz has hit on an interesting way to innovate and compete in the travel space.

Let's Go to The Blog

In its latest attempt to battle Anheuser-Busch, an employee from Miller Brewing Co. is now running a blog (Brew Blog) which breaks news about beer, especially Anheuser-Busch. Recently, James Arndorfer, posted information on Busch's latest brew, "Budweiser American Ale" ahead of the company's marketing and PR campaigns. This clearly angered Busch, which surely felt as though it was "scooped".

This site is evidence that "corporate espionage" and "sabotage" could take on a whole new meaning in the age of the internet, particularly for consumer product companies. Although the estimated damage is difficult to measure, it is easy to believe that these types of actions between rivals could cost millions. For example, company A spends millions designing and setting up and ad campaign and it's rival breaks the news ahead of the campaign. And on top of that, the rival could do it for free on a blog.

In addition to spilling news about its rival, MIller as basically created a platform to spin industry news in its favor. The biggest question will be credibility. Will consumers trust this site or view it as "manufactured" marketing?

http://online.wsj.com/article/SB120829767153417401.html?mod=2_1567_topbox

Real Beauty and Product Placement

Dove maker Unilever has spent several million dollars designing a new online community strictly for women that will offer entertainment, blogs, advice, and of course advertising. The Dove brand has been a trendsetter in the industry for the past several years with its "Real Beauty" Campaign where the sompany stopped using waifish models and began showcasing more natural and average women in its ads. Will their creative payoff in this space?

The new site is supposed to strengthen the tie between this "Real Beauty" cause and the company's products. The portal also an has original miniseries called, "Fresh Takes", starring singing sensation Alicia Keyes which is simultaneously airing on MTV's hit show "The Hills". But the major question is, will women take their cues and advice from a soap company? Especially one that is trying to actively sell them something?

Although the site has advice from real doctors about skin care and other issues, the intense use of product placement could potentially be a turn off to consumers. It's one thing if there is a passive recommendation of a product from a non-affiliated party, but since the entire site is run by Unilever, credibility will continue to a major problem for consumers who don't already use Dove products.

http://dove.msn.com

Nintendo Launching "Wii Fit" Exercise Games Targeted at Women

Young male gamers may soon be shocked to find themselves competing with their moms for use of their Wii gaming console. Nintendo is attempting to broaden the gaming market (which is currently dominated by young men) to women with the release of a new product on May 19th called the Wii Fit. This add-on to the gaming system is a $90 attachment that expands the games that can be played on the Wii to things like yoga and push-ups. It also tracks the user's weight and body mass index.

The Wii Fit is already on the market in Japan, and is very popular there. Nintendo is planning a massive marketing campaign for the Wii Fit in the U.S., which includes a huge PR push. It will be featured on TV, as well as outdoor and print ads. Just last week Diane Sawyer tested it on Good Morning America. Interestingly, Nintendo is marketing this product slightly differently in order to suit the different target audience. It is holding most of the ads until the product is on the shelves, rather than engaging in mass media advertising to drum up excitement before the product is launched. Nintendo says that, unlike the core gamers, the targeted women and moms won't be willing to wait a few weeks before they can buy the product - hence the shorter time span between the start of advertising and the product being available.

Will Nintendo alienate its young male core gamers by introducing exercise games targeted at their moms? They don't think so. Perhaps everyone in the family will use it! Nintendo of America's executive VP of sales and marketing says:

The soccer is fun, and the strength training is really hard to do. There is nothing wimpy about the product. It will challenge everyone in the household, and that will keep the product's appeal really strong and broad.

Time will tell. I think it sounds like an interesting idea - the standard at-home exercise tape or dvd with a twist. However, its success might depend upon how willing the female target audience is to using this new medium as a way for them to do their at-home exercises. On the other hand, even if they are willing to try it, sales of the Wii Fit could be seriously compromised if consumers need to first buy a Wii, but have trouble getting one. If that happens, these busy women might just go back to their exercise tapes and not give the Wii Fit a second chance.

Full article: http://online.wsj.com/article/SB120889895144235997.html?mod=todays_us_marketplace

Twitter Privacy Breach

Twitter, the social networking site which functions as a public broadcast/update/news feed/megaphone for users, accidentally displayed the direct (private) messages of several users in their public message stream. The breach is thought to have been the result of GroupTweet, a third party application which allows users to direct message several people at once. I'm a little confused since I thought the whole point of Twitter was to tell as many people as possible what you're doing at every moment, and that things like e-mail were for private messages....All the same, it's on obviously frustrating (and potentially embarrassing) technical snafu to suffer through. This comes on the heels of several of Tumblr's most highly-trafficked blogs being hacked, as well as any number of complaints and bad press regarding privacy violations resulting from various Facebook partnerships with programs like Beacon. In addition to all of the problems with privacy (or lack thereof) on the internet, I think this raises interesting questions about opening up web programs to third-party applications, which (apparently) may have the potential to damage the basic infrastructure and/or effectivity of the site itself.
Source: TechCrunch

Amazon's Digital Media Push - Successful or Not?

Amazon is still plugging away at its digital media initiatives, but it remains to be seen if they will ultimately be successful. Amazon says it is "very happy" with the three primary initiatives in its digital media push. However, information on the results of these initiatives is very hard to come by, since Amazon has disclosed very few numbers on them so far. (An analyst from Deutsche Bank estimates that Amazon has invested $3 million in them, but that they have produced less than $100 million in revenue.) As a result, analysts will look for data in Amazon's quarterly earnings (released Wednesday) to provide some information on how the initiatives are doing.

The three digital media initiatives that Amazon is pushing are: a digial music store, a digital book service paired with a reading device called the Kindle, and a download service of TV shows and movies called Unbox. Analysts say that Amazon has either been too late to market (e.g. its digital music store came out after iTunes was firmly establised) or has tried to move into markets in which the consumer demand hasn't been established yet (e.g. digital books).

I think this poses an interesting predicament for companies such as Amazon, who are trying to make a foray into digital media. If you wait too long, then someone else has snatched up the market. On the other hand, if you're too forward thinking and come out with a service before consumers realize they want it, that won't help you be successful either. How do you strike that balance between being a pioneer with a good idea, and marketing that idea so as to make people want it? Apple was certainly successful in doing this with iTunes and the iPod....it'll be interesting to see what the next big thing in digital media will be.

Full article: http://online.wsj.com/article/SB120889788429535939.html?mod=todays_us_marketplace

Facebook Application Teaches You How to Build Your Brand on Facebook

Facebook is offering its users an application called "The Insider's Guide to Viral Marketing", which promises, among other things, to teach you how to expand distribution with Facebook Ads
and get the most out of marketing your brand on "Facebook Pages", which function as free user profiles for your brand, your band, or whatever it is you're selling. They encourage users to explore and employ available applications, such as one that might allow a customer to make reservations directly from their Facebook Page. By teaching Facebook users how to use Facebook's free tools for advertising, they also hope to lead them into some of the paid services, such as text ads on Facebook. All of this is appears to be part of the company's larger effort to entice more small businesses and individuals to employ Facebook as an advertising tool. While I don't expect them to catch up with Google in this area anytime soon, they do continue to dominate the world of social networking, social media marketing, and one day, perhaps, the world writ large.

Casual Online Gaming for Sports Fans

Play Hard Sports, Inc., an online sports network that exclusively offers sport news and entertainment to sports fans, plans to offer casual sport games for desktop computers as reported by the Boston Globe. The Casual Games Association, an industry trade group, forecasts that people will spend $2.25 billion worldwide on casual games this year. Despite the positive outlook, the casual game industry is a tough business, particularly for those who are targeting a certain niche like sports fanatics. Currently, the successful sites are Pogo.com and MSNGames.com.

But the founder, Jeffrey Anderson, who is also the former CEO of Turbine Inc. that turned Lord of the Rings into an online game sensation, is very enthusiastic about it, especially since Electronic Arts Inc., the leading maker of sports games, announced it would stop selling a version of its immensely popular football game Madden NFL for desktop computers. "That changes the dynamic and the landscape dramatically," said Anderson. "It leaves a very big vacuum."

Anderson will first offer a football simulation game and has plans to eventually add on baseball, basketball, and other sports. The game will allow players to create their own teams and use them against other players via the Internet. Players can also customized characters and add them to their teams. To encourage players to come back, their characters can “level up” so that the more the players play, the better their “franchise players” become. “For instance, a wide receiver will break more tackles or a quarterback will become a more accurate passer.” The idea is that frequent playing will help to develop a community of loyal players.

Play Hard will offer the casual sports games for free and expect to make revenue through advertisements. Alternatively, it will offer an ad-free version to users who pay an undetermined subscription fee.

As other have mentioned on the blog and in class, we have yet see if sites that offer free services to users can truly be profitable through ad supported revenues. To Mina’s blog, online games have different audiences and so require different marketing. Now imagine the eccentricities of gamers, who are sport fanatics. Have you ever watch them play? The intensity of how they are locked to the screen and only to the screen is profound. They can go on for hours, switching off with their partners to take breaks, and coming back for more as if nothing else existed in this world. I think there is great potential for marketers, but it will definitely be a challenge to capture their attention.

Yahoo-Google Under Investigation

To add to the Microsoft-Yahoo drama, there has been talk of antitrust implications of a possible merger between Google and Yahoo, otherwise known as the "other option". The speculations of this possible merger were launched in full force when Yahoo announced that it would conduct an exploratory two-week trail with Google by outsourcing some of its online ads to Google. The "Wall Street Journal" reported last week that the trial has "yielded positive results", thus signaling to the Department of Justice (DOJ) that there are serious possibilities of a long-term relationship between Google and Yahoo. With Google dominating the online advertising market with approximately 60% share and Yahoo following up with 20%, a merger of the two companies could easily violate US antitrust laws.

The story gets even more interesting. Google CEO Eric Schmidt is under investigation by the US DOJ for anti-trust behavior. Upon Microsoft's unsolicited acquisition bid for Yahoo, Schmidt reportedly contacted Yahoo CEO with questionable motives. The DOJ reports:

… The Justice Department is concerned that the test may violate antitrust law, the source said, adding that authorities “have initiated an investigation” of it … The source, who spoke on condition of anonymity, said that some of the government’s concern focused on a telephone call from Google Chief Executive Eric Schmidt to Yahoo Chief Executive Jerry Yang to offer help in thwarting Microsoft’s $44.6 billion bid.

While Google was able to garner regulators' blessing on their DoubleClick acquisition back in March, it does not seem likely that the antitrust gods are smiling upon them this time. While no decisions have been made as of yet, it'll be interesting to see what happens. Who would of thought that amongst the group of Microsoft, Yahoo, and Google, that Microsoft would be the one left out of the antitrust investigations for once?!

Sources: Reuters, Mashable