WPP’s Possible Worldwide has bought a majority stake in Grape, a Russian digital agency. Like most holding companies, WPP is bulking up on its resources in faster-growing markets like Russia, with predictions of 13% to 14% annual spending growth there through 2014. Grape, based in Moscow, was formed 10 years ago and focuses on Web site and social media strategies, per WPP. The agency employs 124 people and clients include SABMiller and Henkel. The shop’s 2011 revenue totaled nearly $14 million. WPP employs around 1,900 people in Russia and currently generates revenues of over $200 million annually from the market. Across the Central and Eastern European markets collectively, WPP said it employs almost 6,000 people with revenues of about $600 million. The holding company has been gobbling up firms in the region this year. In January, it purchased a controlling stake in Russian PR firm The PBN Company, through its Hill + Knowlton subsidiary. In the broader region, Possible also recently acquired Hungarian digital firm Carnation. Based in Budapest, Carnation also has offices located in Serbia, Austria and Romania. Separately, a few months back WPP bought a majority stake in digital shop 41?29! Media Internet, a Turkish digital agency based in Istanbul.
A top Nielsen executive said the company’s fledgling Online Campaign Ratings (OCR) product is heading toward an industry standard in tracking Internet consumption with metrics similar to TV. “What we’re seeing is a real step toward the creation of a currency, and the evidence around that is the fact that both buyers and sellers of advertising inventory are using the product to guarantee the delivery of an audience,” said Steve Hasker, the president of Nielsen’s watch business. AOL said last month it would offer guarantees for online video advertising delivery, based on demographics such as age and gender. Nielsen said 18 of the top-25 advertisers have been working with OCR, and a significant number have signed up for long-term commitments. Hasker, who was speaking at an investor event, indicated that GroupM plans to make joint TV-digital buys in the upfront and if there is under-delivery on the TV side, the agency group will accept makegoods on digital platforms based on OCR. “The extent to which you move out of analytics territory into currency territory really is the test … are people guaranteeing against it?” Hasker said. Both Hasker and Nielsen CFO Brian West said adoption of OCR is outpacing expectations. OCR uses Facebook data as a tentpole, and Hasker said Facebook’s interest comes from a desire to have its display advertising considered alongside TV as an advertising option.
Is there more to General Motors’ decision earlier this week to pull its paid ads from Facebook than meets the eye? Pivotal Research analyst Brian Wieser thinks so. True, says Wieser, the decision highlights a major concern about the social media behemoth: “Namely that the company is still highly risky.” (You wouldn’t know it from the blockbuster debut of its IPO.) But Wieser also believes that GM, by leaking its Facebook decision, was sending a message to the broader media company universe. Given the timing of the message, at the start of the upfront season and a decision earlier this year to cancel a big chunk of the TV time it bought during the 2011 upfront, Wieser postulates that GM was signaling that it’s willing “to walk away from any negotiation with any media owner.” That signal could help improve its bargaining power during future negotiations, he said. “Creating the perception of a credible ability to walk away from a negotiation may irritate media owners and worsen long-term relationships, but it can also result in better pricing outcomes.” Another takeaway from GM's Facebook decision, per Wieser, is that social media is a highly lucrative business for ad agencies. He notes that while GM pulled $10 million in paid ads from Facebook, it continues to spend about $30 million on maintaining its “free” presence on the site through various Facebook pages and content -- a presence that is maintained by the marketer’s ad shops -- or some of them, anyway. GM’s 3-to-1 ratio of maintenance spending versus ad spend on the social site is “abnormal” in Wieser’s view. He estimates that for most marketers, the average ratio is closer to 50-50. Still, it's a potential windfall for agencies. “If we assume the one-for-one ratio is more likely, and further assume that this replaces media budgets for digital advertising which might have been more like five to one (reflecting 20% of media budgets going to services for other digital activities), we can estimate that the five agency holding companies will generate an incremental 1% organic growth from their Facebook-related activity alone in 2012.” And in today’s ad economy, that’s a significant -- even material -- contribution to growth.
Consumers who sued Hulu for alleged privacy violations are urging a federal judge to reject the company's argument that it isn't covered by the federal video privacy law. Hulu's contention that the Video Privacy Protection Act only applies to brick-and-mortar stores is "disingenuous at best," the consumers argue in a 19-page reply filed last week with the U.S. District Court in the Northern District of California. They say that Hulu's bid to distinguish streaming videos from DVDs or videocassettes is "akin to the argument that an email is not a document because it exists exclusively in cyberspace." The lawsuit was sent to mediation earlier this week, but that doesn't necessarily signal that it will be resolved; many cases in federal court are referred to dispute resolution programs but then return to court if the parties aren't able to come to an agreement. The litigation dates to last year, when consumers alleged that Hulu violated their privacy by working with the analytics company KISSmetrics, which used "supercookies" to track people. KISSmetrics reportedly used ETag technology to track people even when they deleted their cookies. ETags store information in users' browser caches, so that even when users erase their cookies, the information contained in them can be recreated. Hulu allegedly used these persistent supercookies to retain data about videos watched, and also allegedly transmitted that information to outside companies like market research firmScoreCard Research, social networking service Facebook, Google's DoubleClick and Quantcast. The Web users argue that Hulu violated the federal Video Privacy Protection Act, which prohibits companies that rent or sell videos from disclosing consumers' personally identifiable information without their written consent. They originally also claimed that Hulu violated the federal computer fraud law and various California laws, but dropped those claims earlier this week. Congress passed the Video Privacy Protection Act in 1988, after a newspaper in Washington obtained and published the video rental records of Supreme Court nominee Robert Bork. The statute itself says it applies to "video tape service providers,” which it defines as companies that deliver "prerecorded video cassette tapes or similar audio visual materials." Hulu asked for the case to be dismissed, arguing that it didn't fall within the definition of video tape service provider. But the consumers argue in their most recent filing that the law is broad enough to cover companies engaged in online video streaming. Hulu also argued that the case should be thrown out because the consumers weren't harmed by any disclosures. The consumers countered that the statute provides for damages of $2,500 per incident, which in itself is enough to allow them to proceed in federal court. While the law predates the Internet era, Netflix and other online companies have been sued for allegedly disregarding the statute. Netflix recently agreed to pay $9 million to settle a lawsuit accusing it of violating the law. Netflix also is lobbying Congress to amend the law by allowing people to consent online to the disclosure of their movie-rental records on an ongoing basis. The company says that such an amendment would enable it to integrate with Facebook by sharing information about the videos people stream with their friends.
What do marketers pay for when buying click-to-call mobile ads? Up to 76% of mobile display ad calls are accidental clicks or "pocket calls" that can waste a brand's budget, according to a recent study. Only 14% come from existing customers, and 10% from new customers. The Marchex report, MPULSE, reveals that major mobile search engines filter out 32% of calls as unqualified leads, spam or misdials. Calls from voice search resulted in 45% of spam and misdials, although existing customers tend to use this feature to connect through major mobile search engines more often: 35% versus 20% for new customers. The findings suggest that the high rate of error should prompt brands to purchase mobile display ads on a performance basis to improve ROI. Conversely, mobile directory partners receive a much lower percentage of spam and short calls, because consumers have clear transaction intent. The analysis of more than 200,000 inbound calls generated through multiple media sources for more than 45 digital call advertisers draws on three conclusions regarding mobile performance for campaigns. Call types vary depending on media sources, the cost of service and spam calls, and test variables to achieve best results. Marketers need to take into consideration the cost of customer service and spam calls when calculating a campaign's ROI, but not all calls convert into sales. This means that even campaigns or keywords with a low per-call price may run more when considering the impact of non-converting call connections for each cost per user. The Marchex report suggests taking certain steps to decrease costs, but also provides data to assist in those decisions. For starters, the call type from a simple misdial to a new business lead can vary dramatically, depending on the origin of the call. Some 38% of calls from online and mobile directories were from new customers, and 10% of calls from mobile display partners were from new clients. Data can help identify the problem, but what do marketers do once they are convinced of change? Marchex suggests giving consumers a variety of connection options, such as app downloads, QR codes, form fills and click-to-call. Marketers need to test different conversation paths for mobile calls, such as the ability to call from an ad or call from a landing page, as well as the performance of ad campaigns across different formats and calls to action. Leverage the ability to connect with consumers in more than one media with placements across a range of mobile Web pages, search engines and applications.
With broad implication for publishers and advertising pushing into the mobile space, new research suggests that “local mobile advertising” remains a highly relative term. Indeed, while localization is the most popular of the targeting options offered by mobile ad networks, the “dirty secret” is that most can’t deliver local impressions more focused than the Designated Market Area (DMA) or city level. That’s according to a new report from Opus Research advisory service Internet2Go. “Even when they say they can target ZIP codes or claim to offer [latitudinal-longitudinal] targeting, they generally cannot fulfill,” according to Greg Sterling, senior analyst at Internet2Go. Publishers and networks often use a city “centroid” and call that “lat-long” targeting, yet only about 5% to 10% of mobile display impressions carry a lat-long today, according to xAd and ThinkNear. The assumption by many, however, is that all mobile networks can equally geotarget and give marketers the kind of local precision that matches the phone’s GPS capabilities, according to Sterling. “In other words, because the phone can tell what’s nearby and pinpoint user location, marketers assume they can equally access that level of geographic precision for their mobile ad campaigns,” he explains. Yet most of what mobile marketers actually get is no better than the mobile equivalent of desktop IP targeting, which can be very imprecise. City or metro-level targeting may be perfectly fine for many campaigns, yet more locally specific targeting -- and the higher response rates it brings -- is generally only available through ad networks that specialize in local advertising. The inability to target in ways that mirror the phone’s “hyper-local” capabilities is a function of several variables and “plumbing issues.” These include uncertainty about how to best address consumer privacy and the challenges of passing location between entities in the mobile “value chain” -- something that is quickly evolving, but is far from fully developed. As the data from various sources indicate, a high proportion of smartphone-influenced activity and buying behavior is offline. “It thus makes sense that users respond better to localized ads; they are seen as more ‘relevant,’” added Sterling. “Yet most marketers are not fully recognizing this or rising to the opportunity.” While the overall traffic coming from mobile devices is still modest -- roughly 12% to 15% of total traffic -- there are numerous indications that people are more engaged with mobile than other media. Indeed, U.S. adults spend more time with their mobile phones than with print magazines and newspapers combined, according to recent eMarketer findings. In addition, Flurry Analytics showed earlier this year that people are now spending more time in mobile apps than on the traditional PC Internet.
Solspot plans to serve up ads and editorial content tied to visitor preferences and geographic location. The strategy --based on algorithms and concept -- relies on forecast weather, wave conditions, tides and wind. The company, recently named as the official surf forecaster for the 2012 American Pro-Surfing series, will launch the redesigned site Monday. Irvine, Calif.,-based digital agency The Buddy Group (TBG) supported the design of the new site through a local competition. SolSpot won $40,000 in agency fees from TBG to develop it. The ad exchange OpenX supports the delivery of ads. Solspot.com pulls in concepts used in forecasting to develop the Web site and content. Using proprietary algorithms, the company crunches historic data with recent numbers pulled in from the National Weather Service. Using a 1,000 x 1,000 meter grid, the technology can forecast wave and weather conditions for a specific spot, such as the Southside of the pier in Huntington Beach, Calif. The contour of the ocean's floor can influence the waves, said Jens Rasmussen, chief surfing (science) officer at Solspot. Data and algorithms are specific to each surfing spot. Current conditions also are based on buoys in the ocean a couple of hundred miles offshore to read wave heights and swells. This is combined with data from nearby weather stations and digital video recordings that monitor conditions shot from cameras mounted on buildings at the beach to supply forecast data to site visitors. Rasmussen plans to take that concept further to provide Web site editorial content, such as an article of a local surf shop. He expects the site to generate growth from new site visits between 30% and 40% during the next two to three months. The second phase of this launch will include complete customization and personalization of content on desktop and mobile, he said.
Whether in celebration of its Friday IPO or Saturday’s wedding of founder Mark Zuckerberg, Facebook has added another mobile acquisition to the pile with the purchase of the year-old social gifting company Karma. The e-commerce startup creates a curated catalog of products that mobile app and Facebook users can send directly to their friends. You pick a gift from the app-based catalog, add a card and send it via SMS, email or Facebook. The app advertises its convenience, in that it can gift anyone from anywhere without the sender having specific shipping information on the recipient. When the gift-getter receives notice of the gifting, he or she can make color or flavor choices, even swap the gift for an alternative from the catalog or convert the gift to a charitable donation. The getter then enters the shipping info, which Karma fulfills. The acquisition is significant in that it not only gives Facebook an interesting e-commerce revenue stream but further enhances its mobile footprint. While the newly IPO-ed company has been criticized widely for its lack of a mobile ad strategy, Facebook seems to be establishing its mobile presence mainly through acquisition. In addition to its high-profile $1 billion purchase of Instagram, Facebook has also acquired mobile media companies Lightbox, a photo-sharing app for Android, and location-based people discovery app Glancee this year. The acquisition was announced on the Karma Web site by founders Lee Linden and Ben Lewis, who previously had developed TapJoy. “We’re thrilled to announce that Karma has been acquired by Facebook,” the two founders announced on the blog. “The service that Karma provides will continue to operate in full force. By combining the incredible passion of our community with Facebook’s platform we can delight users in new and meaningful ways. As we say … only good things will follow.”
Regulators in China have finally approved the Google acquisition of Motorola Mobility, clearing the way for the acquisition to close quickly, according to a Bloomberg Businessweek story this weekend. Acknowledging that the proposed deal has now cleared all global jurisdictions, Google said in a statement yesterday “we expect to close immediately.” The Motorola Mobility acquisition gives Google 17,000 patents with which to do legal battle with and wage defenses against competitors in what has become an extremely litigious segment of the economy. But the larger question becomes how Google itself wants to play in the handset space now that it controls a large hardware manufacturer that competes with the same handset manufacturers -- like Samsung and HTC -- that have made the Android operating system a global success. Google’s challenge in competing with Apple has been its strength -- openness of the OS. The robust, freely available OS has scaled quickly because it gave OEMs a way of competing against the iPhone across any carrier. But the resulting iterations of the OS on smartphones and tablets have created a fragmented universe that is discouraging some developers, despite Android’s market-share dominance. The China regulatory clearance required that Google maintain openness of Android for the next five years, which appears to mean that Google cannot create versions of the OS that are not available to others. Still, the Motorola Mobility acquisition puts Google in a better position to compete directly with Apple, since now it also owns both hardware and software in the mobile ecosystem. How the company plans to leverage that new advantage without raising the ire of current software partners that are necessary to the future of Android is an open question.
In college, one of my pals bought an 80-watt Dynaco stereo control amp kit and painstakingly built it over four months. That fall, he pulled a 0.2 GPA -- a lost semester that cost him, after figuring in his $30 savings on the amp, about two thousand 1974 dollars. I bought the identical model, pre-assembled, and listened to music while he soldered. The point of the story? One is to beware of false economies. The other is that I’m no DIY boy. I happen to follow Radio Shack on Twitter, but not to get the latest deals on capacitors or some such. I do almost nothing myself, and if I could hire someone to brush my teeth I would. Truth be told, I only started following Radio Shack because I was trying to do some work for the now-departed CMO. But the tweets still pop up on my screen, and the other day one captured my attention: “The ability to stop time exists... if you calibrate a camera’s frame rate to match the frequency of water vibrations http://shack.net/LPEIPX” Hmm. Unusual. I’ve grown accustomed to seeing Radio Shack tweets about deals on new products and promotional offers. (Example: “RT if you're ready for a new phone. @RadioShack will give you $5 to let us check your eligibility. http://pic.twitter.com/c3hEoySJ”) And on Friday, when TechCrunch reported that Facebook engineers had rewired the NASDAQ opening-of-trading button to instantaneously share the company’s moment of truth as a story on Mark Zuckerberg’s Timeline -- and used Radio Shack components to do it -- it was a no-brainer for Radio Shack to retweet. (“RT the most epic button push ever. NASDAQ button hacked w/ @RadioShack parts to update Mark Zuckerberg’s FB page. http://shack.net/KIUDy3”) But water vibrations? Why pass that along? Here’s why: because it was cool. The link led to a Gizmodo post of an amazing video, appearing to capture flowing water droplets suspended in time and space. The effect was accomplished by passing the tube of flowing water over a loudspeaker, vibrating at a certain frequency. This was photographed by a digital videocam whose refresh rate had been adjusted to match the speaker vibration. The resulting playback was super totally fascinating in every way. No deal on stereo speakers was promoted. Or digital cameras. Or anything else to do with the Radio Shack brand. The only connection to Radio Shack was the brand’s natural connection to a community that would find this video worthwhile. Look, if it was cool to me, can you imagine how it played to the geekosphere? Better than “Game of Thrones.” Isn’t that how social media is supposed to work? Or else they’d call it “sales media.” “Having a conversation is not just pushing products all the time,” says Billy Roberts, who handles Radio Shack’s Twitter presence for a third-party agency. “We obviously have a lot of scheduled messaging: ‘Here are the promotions, here are the products that are coming out.’ But as much as I can, I try to share things to engage the audience, which is what the social media space is for, if you ask me.” How subversive. Treating the people in your social circles like friends you like to share stuff with. Being thoughtful. Strengthening connections. Cultivating relationships. Weird. “I try to do at least four or five of those sorts of posts a week,” Roberts says. “They tend to be DIY projects that Radio Shack customers have built. Where I find this stuff, is I personally subscribe to a lot of RSS feeds for blogs where people upload their projects.” Mind you, Roberts does devote the lion’s share of his tweets to Radio Shack-specific matters, and -– hand it to the guy –- when invited to grouse about clients abusing the social space as a virtual Advo bag, he doesn’t take the bait. The precise question was: “Billy, shouldn’t the majority of tweets be there not to sell but to cultivate common ground?” “That’s not exactly what we’re here for,” he replied. “We’re here to help the client get the messaging across that they want to on their channels, so what we try to do, as much as possible, is marry the two worlds. We want to engage the audience and make the client happy and then everybody wins.” Maybe. Or maybe he was just being diplomatic. (In tracking him down, I was a bit surprised the work wasn’t done in-house. Alas, I can’t mention Roberts’ agency because, as it turns out, it is one I do business with.) But having recently spent a day with social media execs at major multinational brands, I have the distinct impression they would like their management to stop thinking of Twitter and Facebook as “messaging channels” and start embracing them for what they are: places to share with fans, friends, potential friends, casual acquaintances and total strangers, so that the brand might be liked, trusted and maybe even admired. Sending something cool to people who you suspect will find it cool is cool. Using Twitter, et al, as a medium for free advertising is a fantastic method for boring or scaring people off. As my college pal learned the hard way, it is ruinous trying to save money by assembling something you don’t understand.
Recent reports indicate the Pinterest tidal wave may be receding, yet there is no doubt people are just as bananas about new, quirky and socially connected platforms as ever. Entrepreneurs are jumping at the chance to invent the next hottest start-up and one thing remains clear: Marketers must be just as interested in understanding best practices for using these emerging platforms. Entrepreneurs are not alone in recognizing the potential for sites that offer high user engagement, often tied to social networking and e-commerce. The Fancy is a Pinterest-like site that monetizes user-curated images and allows users to organize images into lists and conduct transactions on the site. Two new digital start-ups, Pinstagram and Pingram, merge Pinterest and Instagram in the latest mash-up to reach investor’s eyes. It’s no wonder the venture capital world is bubbling and marketers are scrambling to understand how they can monetize emerging platforms. Peer pressure: Everyone else is doing it-should you, too? According to comScore, Pinterest users spent an average 89 minutes on the site in January, far passing Twitter and LinkedIn, tying with Tumblr and second only to Facebook. Just because Pinterest has more than 10 million members, should every brand have a presence? If so, how can it be impactful and ultimately drive brand participation? Brands need to recognize that the power lies within the listening. Clients should sign in and listen/watch what participants create, how they share and with whom. At that point, you’ll have a more clear vision of your potential reach, engagement and competition. Shift From Consumerism To Participation Inherent to Pinterest’s intrigue and its commonality with other social sites like The Fancy, Instagram, Twitter and Facebook, is the social connections and share ability. When marketers make content easy to share via the site, they tap into a new vehicle for raising brand visibility. The user experience is less about consumerism and more about participation (both active and passive). It feels organic, relevant, focused and socially driven. Both marketers and participants post content and share it, which increases reach and relevancy, but also raises credibility of the message. A marketer doesn’t just have to share their own brand’s information or products. If you know your participants are seeking trend and style, why not also connect with content from leading stylists and fashion setters, within your branded page? Marketers should harness and utilize available data to better understand new and existing customer behaviors on socially connected platforms like Pinterest. Pinterest users are estimated to be largely between 25 and 54 and the majority are women. Would a brand that caters predominantly to male baby boomers benefit from a Pinterest presence as much as a brand with a core customer base of millennial females? Probably not, so one size does not fit all and marketers must consider this before allocating dollars to the latest and greatest. Leveraging the social analytics behind a platform can help guide where and with whom to invest time and resources. Marketers may be surprised and see that a small sub segment of their total customer base is male and drives a larger average order size within social shopping platforms like this than they do females. This is when we can make social data truly powerful for brands! According to comScore, the typical Pinterest user profile: •68% of users are women •80% are 25+ •50% have children •28% have a household income of $100K+ So You Begin to Pin: Now What? Smart marketers harness the power of the pin, among other social capabilities, and capitalize on emerging social platforms. They engage with: Visually appealing content: Startups like Pinterest and Instagram owe much of their success to presentation. High resolution, appropriately sized and clear pictures and video are a must. Brand consistency: Emerging platforms, just like any digital platform, are an extension of your brand identity. Maintain consistency with your native site and other branding efforts. There is also no room to be stagnant on an emerging platform. Original and shared content: Many emerging platforms are designed to mix both. As evidenced by the sign on partnerships with Facebook and Twitter, engagement begets engagement. Test and learn: Emerging platforms are really a win-win in this area. Use analytics to understand site engagement, test new opportunities and learn the best way to engage with users on any given platform.