As online video continues its dramatic rise, Ogilvy & Mather on Thursday officially debuted its own specialty video practice. In development for nearly two years, Ogilvy's Advanced Video Practice will work with brand clients to take video engagement beyond the "viral" view by targeting measurable engagements that place viewers directly into the sales funnel. It is being led by Robert John Davis, who joined Ogilvy in 2008, after leading Rainbow Media's cable network sites and serving as MTV Networks' first executive producer of convergence. "It is not just TV 2.0 -- a new way to get TV programs online," Davis said of the burgeoning video space. "This is a vibrant, interactive engagement medium that goes beyond watching videos to engaging with videos." According to Davis, the new practice should augment various Ogilvy specialty areas, including digital influence, search optimization and search marketing, creative, content strategy and social selling. "Video is too important to treat as an add-on to TV or Web marketing efforts," Davis said. "As advanced video opportunities continue to grow across mobile and device-oriented experiences, maximizing this channel is vital for a brand's success." During its test phase, clients who helped shape Ogilvy's new practice included IBM, Nestlé, DuPont and others. The practice will focus on several key aspects of online video, including the creation of strategic content and video search engine optimization, as well as the production and distribution of video across multiple digital platforms and measurement. Furthermore, the plan is to bring together experts from online video strategy and production with the Neo@Ogilvy search practice and OgilvyEntertainment, to provide clients with a full-service online video platform. Needless to say, trying to maximize the potential of YouTube as a marketing channel for clients is one of the key ways in which the practice will be exploited. "Our strategy is built around the belief that views will be maximized if you optimize for the multiple forms of search first, making it easy for audiences to find, consume and share the content when they need it most," Davis added.
A mobile search engine relying on social signals, location-based services, machine learning and natural language processing to rank and serve queries could turn into a gold mine for marketers and advertisers. The four cofounders -- from a former Apple intern to a venture capitalist -- include CEO Corey Reese. The co-founders refer to the "Likeness" engine as Ness, which combines search and recommendation in a mobile service. The engine aims to answer subjective questions by understanding the likes and the dislikes of the person making the query. The difference in factual, and subjective queries reside in questions such as "Which Italian restaurants are in Los Angeles?" vs. "Which Italian restaurants would I most enjoy in Los Angeles?" Although in the conceptual stage since 2009, Ness Computing took the "talented" team 18 months to develop. Co-founder Paul Twohey, a Stanford University graduate who interned at Apple between 2000 and 2002, said Ness will launch imminently. As a budding developer during his last summer at Apple, he designed, wrote and implemented the first version of a cluster-wide remote software upgrade for the Mac OS X server in less than a month. Designing a good mobile experience requires different thinking, so some of that "talent" came from Apple. Twohey -- along with other company executives -- recruited Scott Goodson, an original member of and senior engineer on Apple's iOS team, and appointed him director of mobile engineering at Ness. Reese was formerly in venture capital at Alsop Louie Partners, where he initiated the company's investments in Justin.tv and Gowalla and managed its program that discovers up-and-coming technical talent at leading universities. Reese founded the company with Nikhil Raghavan, a founding member of Yahoo's Structured Web Search team; Twohey; and Steven Schlansker, a multiple-time hackathon winner and programmer at UC Berkeley. Together, the team will build out the data pipeline to serve up queries on the mobile search engine. Search queries will pull data from crawlers and licensed content as well as social networks, when the searcher opts in, providing Ness with access to information in social streams and sites, such as Foursquare. Ness will serve up more personalized results through social signals and location-based services, depending on the quantity and quality of information that searchers choose to share. Twohey declined to detail the back-end of the mobile search engine, such as content ranking factors and the integration of paid-search and rich media ads, and instead focused on personalization. The search model will also likely support both audio and text search queries from historic searches, supported by machine learning and natural language processing. The concept took years to craft because the Web lacked social data that people were prepared to share, Twohey said. "Today, we're only using the shallow signals, such as check-ins to the Lady Gaga concert," he said, which might reveal the person arrived late or bought premiere parking passes for $25 to eliminate the hassle of finding a place near the stadium. Aside from preference messages in comments or likes that express sentiment, there are other signals that could provide useful targeting options. These signals in aggregate -- a bonanza for marketers and advertisers -- would suggest the value of a potential audience segment, for example. Twohey continues to carry the experience from Apple with him. "When I worked at Apple, we thought of the user as the teacher -- someone who wants to get their job done -- and your product is not their primary purpose, just a tool that helps them get to their real goal," he said. "That's the biggest message I learned from working at Apple." Ness might not have any direct competitors, but engines such as Google and Microsoft -- banking on mobile search and advertising -- already have a head start. Research firm IDC estimates that Google's Android operating system will take 38.9% of the worldwide smartphone market, compared with Apple at 18.2%. Ness on Wednesday announced raising $5 million in Series A financing in November 2010. The round, led by Vinod Khosla and Ramy Adeeb of Khosla Ventures, also had participation from Reese's group at Alsop Louie Partners, as well as TomorrowVentures, Bullpen Capital, a co-founder of Palantir Technologies and several angel investors. Ness plans to start as a mobile service and add search for computers and possibly tablets and other mobile devices in the future. The company's team of three machine-learning PhDs is led by Dr. Jeremy Schiff, who was formerly president and co-founder of Fotoflexer. The company has operated in stealth mode since it was founded in October of 2009, when it received seed funding and was developed by Alsop Louie Partners.
The frenzy around mobile payments this year has been driven in no small part by initiatives such as Google Wallet and the wireless carrier-led Isis project, based on Near Field Communications technology. It would allow consumers to wave their smartphones in front of a small reader near the checkout to make purchases. But a new Gartner report is skeptical about whether NFC-based payment systems will take off anytime soon. It also expects the growth of mobile payments won't be as explosive as some have projected. But that doesn't mean the industry won't enjoy strong gains this year. Gartner predicts mobile payments worldwide will jump 76% this year to $86 billion, while the number of people making mobile payments will grow 38% to 141 million. Despite the eye-catching numbers, the research firm notes that the mobile payment market isn't growing as fast as expected globally. In advanced markets, the firm believes the promise of mobile payments driven by NFC technology is at least four years away from reaching mass adoption. "The biggest hurdle is the need to change user behavior by convincing consumers to pay with mobile phones instead of cash and cards," said Sandy Shen, research director at Gartner. Most m-commerce activity to date has been driven by mobile applications from major retailers like Amazon and eBay, leading merchandise purchases to far outweigh other types of buying in developed regions. "We predict that in 2011, merchandise purchases will account for 90% and 77% of all transactions in North America and Western Europe, respectively," said Shen. In developing areas, Gartner said mobile payments haven't caught on because service providers have not adapted their strategies to local market requirements. It expects SMS and Unstructured Supplementary Service Data to remain the dominant access technologies in emerging regions because of the constraints of mobile phones there. A separate report by Juniper Research last month forecast that the number of mobile phone users making payments for digital goods would reach 2.5 billion worldwide by 2015, up 40% from 1.8 billion this year. It pointed to travel ticketing and entertainment as key areas influencing growth, along with new services and apps delivering things like mobile coupons and rewards programs.
Amid one of the hottest summers on record, it's hard to start thinking about holiday shopping trends. Still, marketers should take cool comfort in a new report from direct marketing agency Epsilon, which predicts that the holiday season will be a strong one. Indeed, better cross-channel marketing strategies combined with an early-season push should improve results and increase revenue during the coming season, according to Epsilon. "Throughout the year, companies are focused on selling a product or brand and their promotional strategies reflect this priority," explains Jill LeMaire, senior director of the Strategic and Analytics Consulting Group at Epsilon. "However, during the fourth quarter, they are in the gifting business and the way consumers relate to the brand and buy products is entirely different than other times during the year." In 2010, online sales peaked the week of Black Friday and Cyber Monday -- or week 48 -- while retail sales reached their peak a bit later in week 51, the week leading up to Christmas. According to Epsilon, social media and mobile capabilities were key drivers of sales on Thanksgiving Day last year, as consumers used mobile devices for Web site reviews, promotions, to check prices and to check in while shopping at stores. Meanwhile, in 2010, holiday email open rates climbed 11% year-over-year, despite high email volumes. However, click rates fell 16% from 2009 to 2010, while -- for the second consecutive year -- the highest open rates occurred the week of Black Friday. Also of note, in both 2009 and 2010 the words "shipping," "free" and "gift" were often used in subject lines, but did not necessarily drive opens. "When it comes to holiday marketing, marketers shouldn't simply follow their competitors," LeMaire added. "To be successful, marketers should start early. Their strategies should differ by channel, based on the way consumers interact with brands and should be fully integrated to leverage the value of each individual channel and touchpoint."
Groupon's recent changes to its privacy policy are drawing scrutiny on Capitol Hill. Earlier this month, the company said it would start collecting and sharing more information about users with its business partners. On Thursday, Reps. Ed Markey (D-Mass.) and Joe Barton (R-Texas) asked company CEO and founder Andrew Mason a host of pointed questions about its intentions. The lawmakers' questions include whether Groupon intends to obtain consumers' opt-in consent to data collection, including geolocation data, and whether the company requires its business partners to adhere to Groupon's privacy policy. "Groupon offers discounted prices on personalized deals, but it shouldn't discount the protection of customer's personal information," Markey stated. "Groupon may be collecting personal information, such as phone numbers, emails and location data from mobile devices. This type of sensitive data, especially if it belongs to children and teens, requires special protection." Markey and Barton, who co-chair the House Bi-Partisan Privacy Caucus, also asked Groupon specific questions about how it determines consumers' ages. The lawmakers recently unveiled legislation that would ban behavioral targeting of minors under 18. The lawmakers also asked Groupon to explain the extent of data collection about users' friends. The letter refers to a section of Groupon's privacy policy that says the company collects contact and relationship information when people buy Groupons as gifts. "Does this statement imply that Groupon would capture personal information about a person who did not interact with Groupon without the customer having knowledge of the data collection?" Markey and Barton asked.
If you've been keeping abreast with social media, there is nearly an infinite number of ways to leverage all the data in new and interesting ways. One of those uses is in the personalization of the Web search experience based on the social graph. But what does this mean and why should we care? From the days in which Google started the paradigm shift in the search market, the refinement of search has been driven by the growing amount of global information. From graph mining, to deeper text analytics, to user search patterns, all of the mechanisms have improved our ability to get acceptable results quickly. But with the advent of social media, there are new and interesting ways to take search to a personal level. Your social networks provide personalized views of what's contextually relevant to you, based on what you and your friends have expressed as interesting. Relevance to you and your friends can be recommendation-driven based on your Likes, +1s, Shares, and Retweets. Or, it can be mined directly from the conversations and discussions you carry. Will this mean the Web experience becomes fundamentally different? The way that Amazon has personalized your buying experience is similar to the future possibilities of a personalized Web. Not only will we have the choice to search for information in the way we've grown to love, but we'll have a Web-scale recommendation engine to enable new ways for us to discover and surface information we might not know we should be looking for. What I find exciting about these possibilities is its extension of how we can interact with the growing content that's out there. Search has always, and will always, give us the capabilities to look for information that's out there. We will always need the flexibility to extend beyond ourselves and our friends' interests, ask new and novel questions of the Web and find information independent of our social network. Social search takes us down new paths of answering the question "What should I be looking for?" and "What don't I know to ask?" By applying context derived from our local networks, we can be more confident that social search-driven recommendations of content not expressly asked for will be interesting, engaging and often serendipitous. What is the impact on brands? For brands, this brings up a unique and difficult question. If everyone has a personalized view of the Web, how do we actually assess the impact and visibility of owned, earned or bought media? Especially when our consumers are presented with an ever-changing and highly dynamic localized context. The short answer is we shouldn't be worried about that. This actually provides new ways to target contextually relevant and more impactful messages to consumers. Better targeting and better messaging means more effective engagement. Brands and consumers can form stronger relationships through a deeper understanding of each other. And at the end of the day, our true measures of success are still going to be driven by the bottom line. In fact, the only thing we should fear is ourselves. Not recognizing or not adjusting to the evolution of the Web is the largest risk to everyone.
If you read the new combined Adweek/Brandweek/Mediaweek, you'd best double-check the facts and figures they quote in their stories. Just this past week in a story where Paul Gelb, Mobile Practice Lead of Razorfish told Adweek in an (hope you are sitting down...) exclusive interview, "I think mobile ad spend will overtake television," Adweek provides this handy and utterly wrong link on the $131 billion advertisers dropped on television last year. You don't have to be in the ad business to know that TV gets about $60.5 billion a year in ad dollars and that the reporter misread the linked story, which actually refers to the total ad spend for the U.S. Two days (and counting) after the story posted, the mistake remains uncorrected. Were this a term paper, that mistake would cost you at least an entire letter grade. At the new Adweek, who knows -- it might result in a promotion. While it would be great fun to point out all of the things I don't like about the new Adweek (mostly its snide and presumptive attitude), I digress and would rather this week make fun of Paul Gelb (who tweeted that he thought the story was "great stuff," without pointing out the glaring error). According to his LinkedIn profile, he graduated from Cornell in 2002. That means that when guys like him were running about in the late '90s saying the Internet would soon surpass TV ad spending, Paul was playing beer pong and cramming for his midterms in macroeconomics and international business. "It's only been four years since the first iPhone was introduced," Gelb gushes in this exclusive interview. "If you'd predicted then that smart phones could outsell PCs and that people would spend an hour a day on their phones, no one would have believed you." Smartphones are one of the fastest technology adoptions in history, he told a rapt Adweek. Sounds just like the claims about the phenomenal growth of Internet penetration and the rapid adoption of broadband that guys like Paul were jumping up and down about earlier in this century. But what can you expect when your job description says you are "a trusted consultant to Razorfish's largest clients as they evolve their media and business strategies to include breakthrough technology and advanced platforms"? That means you insist that the areas you are responsible for -- in this case mobile -- will grow just like weeds in a newly fertilized flower bed. No matter that TV is enjoying a significant resurgence in ad spending despite all that "breakthrough technology and advanced platforms," or that TV continues to reach 89.5% of U.S. adults on a daily basis and outperforms its closest media competitor, the Internet, at 67.5%. The engagement rates are higher (on mobile than TV), Gelb apparently told Adweek in that exclusive interview. Not sure where that comes from, but if in fact folks are spending more than four and a half hours a day (average TV time for adults) on the phone, there are some seriously dead batteries out there. And tumors sprouting quietly in lots of craniums. I don't care if there are already more mobile devices out there than there are actual living, breathing people walking the globe, and that some media companies are falling all over themselves to provide TV everywhere -- including on those handhelds -- Paul will be a distant memory to his grandchildren's grandchildren before mobile mounts any kind of real threat to TV. In fact, I would suggest that mobile ($1.1 billion) will be hard pressed to catch up to online ad spending ($26 billion) any time soon. The ad clutter on network TV is so profound now that it is driving audiences to time-shift more and more viewing to skip past the endless banks of ads in commercial breaks. So try cramming all that spend into your mobile phone and see just how pissed off consumers can get. But, hey, you got a headline in Adweek. The world is good, right?