The Facebook 'Fad'?

Facebook is not a fad. I say this because I don't feel that its popularity will slow anytime soon. This is because of Metcalfe’s law. Let me explain...

The general idea behind Metcalfe’s law is that the larger a network grows, the more valuable it becomes, because every new person who joins the network adds value to everyone else who is on the network. A good example of this phenomenon at work is user forums. Online forums are where people go to get their questions answered. The more members that join a forum, the faster questions will be answered, and the more diverse the opinions and skill levels - thus adding value to the network.

This notion of more sign-ups raising the value of a program has the opposite effect for some things, however. If you consider how a contest works, your chances of winning go down the more people you invite to enter.

The value of Xbox Live, an online gaming community, certainly goes up as more people sign on, and it was a player's dream when it hit 10 million users over the holidays! (Marketing Profs Podcast, 2008).

The same can be said for iPods, but the type of value increase is slightly different. For every person who buys an iPod, the community of iPod fans is strengthened, increasing the 'bandwagon' effect, and resulting in higher sales for Apple.

Now back to my initial prediction for Facebook. Over the month of December, 2007, Toronto became the first North American city to have over one million subscribers to Facebook (Zinc Research, 2007), and approximately half of online Canadians were said to be on Facebook in December, which is almost double the rate of a few months earlier!

This constant growth for Facebook is a success that can be attributed to the workings of Metcalfe's law, and it is the reason I don't see the trend slowing down anytime soon.

Can you think of a product or tool, online or offline, which is self-reinforcing?

Measure Your Web 2.0 Activities

Web 2.0 allows a different type of interaction with your customers in that it promotes longer term relationships. It remains integral to measure immediate conversions such as sales, however understanding your visitors over time is also key within the web world. The reason for this is that one interaction may not result in an immediate conversion, but it may influence an action the next time the consumer interacts with an element of your campaign.

Some are quick to judge one part of their campaign, for example the offline portion or online display ads, when their pay per click campaign appears to be generating the highest conversion rates in terms of sales. What they cannot see, is the value that the other campaign elements have on a visitor’s perception of the brand by the time they are exposed to the pay per click ad.

A sports apparel company that wants to understand the effectiveness of each aspect of their marketing mix which includes RSS, display ads, and paid search, would benefit by doing this type of session-by-session evaluation. I've named our persona “Jim” for the sake of personalizing this description.

Session 1:
- Jim finds the sports apparel website by clicking on a display ad that pops up while he’s reading sports news.
- Jim browses through a few pages of content, registers for RSS and then leaves.

Session 2:
- Jim regularly reads the company’s RSS feed and sees one article of special interest, so returns to the site.
- Once back on the site, he continues to look around for about 20 minutes, interested in additional related content.

Session 3:
- Jim is searching for articles on the Grey Cup game and responds to a natural search listing for content on the apparel company’s site – the cheerleaders were outfitted with their clothing.
- Jim posts a comment on the article and then leaves.

Session 4:
- Jim continues to read the RSS feed regularly and after reading many strong reviews on the company’s clothing, he becomes more committed to the brand.
- One day, Jim is in need of a new dry-fit top for working out, and so he accesses the apparel site directly and makes the online purchase.

Now, if the session-based data were analyzed as individual units, then all of the marketing activities would be undervalued or the last activity resulting in the conversion would be assigned a false high value:
- Display ad didn’t convert
- RSS didn’t convert
- Natural search didn’t convert
- Accessing the site directly converted

You need to see the complete picture to make appropriate decisions, and if the sale is the desired end goal, then measure it, but find a way to follow the paths consumers take to get there. There are tools out there such as WebTrends and even Google Analytics that are capable of it (some more sophisticated than others). It will take pre-planning and thought to set things up properly and of course time to analyze results regularly so that they are meaningful and actionable.

Marketing is an evolutionary thing, and moving visitors along in the sales cycle should be seen as equally important as the activity that results in a sale. Other types of activities, such as signing up for RSS or commenting on an article, are still ‘conversions’ – and therefore should be measured and considered to be successes within their own realm.

Misleading advertising - is it ever a good business decision?

I was reading a women's magazine this past weekend and came across an article that focused on how to read nutrition labels. It gave some tips on how not to take food packaging labels at face value. Given the health – or lack thereof – of our nation, it really angers me because nutrition labels are often confusing - if not outright misleading, making it more difficult for consumers to make healthy, informed choices.

This is particularly the case when it comes to the advertising on the front of food packaging. For example, do you know what the differences between ‘100% wheat’, ‘100% whole wheat’, ‘whole grain’, and ‘multi grain’? They all sound healthy - don't they? But they are not all of equivalent value to your health. Click here for a resource that explains them in simple terms.

In Canada, the statement ‘fat free’ can be used on the labels of products containing under 0.5 grams of fat per serving (serving size as specified by Health Canada). So a product with 0.2 grams of trans fat and 0.2 grams of saturated fat per serving can still make the claim of being 'fat free'. Interesting, isn't it? See for yourself just how complicated things can get by visiting the Health Canada website.

What about the brands that have the word ‘organic’ in their names? Are they truly organic? Or is it just a devious tactic they are using to make you believe it’s so? There are many different organizations that establish organic standards, and their standards are not all created equal.

It's important to be aware that labels don't tell the whole story. Without lying, companies can intentionally mislead in their quest to get you to choose them over the other guy. My question is whether they are at all worried about backlash, as consumers begin to learn their nutritional ABC's? I wouldn't wait around to find out, if I were them.

More than one way to get a gamer's dollar.

I’ve recently been taken in by an addictive little PC game called DriftCity. A free-to-play online driving game that launched earlier this month, and it had me reflecting on the changing economy of online video games.

The subscription revenue system has worked for a long time on game-behemoths like World of Warcraft and Everquest, both of which have been around for several years and have raked in billions (yes, with a B) of dollars. But games with lesser production values and hype have been left with a problem of not being able coax players away from the game they are paying for monthly in order to try something else they will need to pay another monthly fee for.

The result of this dilemma has been a number of interesting new ways of getting money out of gamers and games.

DriftCity for example uses a revenue structure that is very common among games originating from the east, Korea in particular. A player can download and play their games for free, but the player is also allowed to purchase in-game currency using real currency. This allows them to obtain special items which will either increase their character’s stats and/or decorate their character to fit the player’s liking. An example of this would be a new hat costing about 30 cents in real-world money, allowing a player to look unique while giving them an in-game advantage, such as making the character slightly stronger or faster. Only a small percentage of players will ever actually reach for their credit cards to do this, but it is enough to cover the game’s server/staff costs, and then some. This revenue model has been surprisingly successful. The genius here is that people with only a passive interest in a particular game will likely at least try it out, thus creating a large community of registered players, the larger the group is, the more likely that game will be mentioned in the media, thus getting the attention of even more potential players.

Second Life, for example saw a tidal wave of new players join its ranks over the past year, due to the all the hype it received from news sources reporting on large companies, like Sony and Ford buying space in the game simply to advertise their products. The game itself is, and has always been free to enter and explore, but real money is required to purchase property, very similar to the Korean free-to-play model. The hype from name-brand companies creating their presence sent Second Life’s population from the hundreds and thousands, which it had hovered at for years, into the hundreds of thousands. Many groups and organizations from political campaigns to musicians and fashion designers have jumped in, and are buying up their own virtual space to show-off their real-world products.

That’s all I’ll say for now, but perhaps next time, I’ll address a new spin an old idea, in-game advertising.

Letting Customers Talk the Talk: Grassroots Marketing through Consumer-Generated Content

In an effort to spread the word without spending a fortune, what marketer hasn’t considered engaging their consumers in the process of content creation? After all, you don’t own your brand — your customers do. Chances are, they also own a camcorder — or at least a cell-phone with built-in camera — and are not afraid to use it.

V-CAM, or viewer-created ad messages, have taken marketing by storm, and are becoming an important element of grassroots marketing in the YouTube era. If part of your goal is to support a living brand, then consumer-generated content can be an effective way to get results — so long as it is properly planned and executed.

The idea of getting consumers to create your content is sometimes called brand democratization. Many big players are doing it: Audi, GM, Nike, and L’Oréal Paris. Sometimes it works brilliantly. Nike’s consumer generated ads for Converse led to a 300% increase in site traffic and an 11% increase in sales. But there are also risks. VW, for example, ended up in a socio-political minefield when a V-CAM was created featuring a VW Polo that thwarts a terrorist attack, confining a suicide bomber’s blast to the inside of the car. Politically sensitive material, to say the least.

Because of the inherent risks, and the fact that V-CAM works best (and worst) with the world’s biggest brands, pure consumer-generated ads may be more of a fad than a movement, and are unlikely to see widespread use.

Consumer Collaborated Ad Messages

So how do you mitigate the risks and still engage your customers in the life of your brand? Call it consumer collaborated ad messages.

Provide all of the creative elements you want to see in an ad, then let your customers “mash them up” to create something they can call their own. The Internet, with its combination of Ajax tools and cultural shift toward user-generated content, is an ideal place for this kind of customer engagement. Give them a sense of brand ownership — let them create, judge, share, and encourage their friends to try making their own ads — without endangering your brand.

You can take the idea of consumer-generated content a step further by integrating customer input into your overall brand message. Think of those charming couples wearing Tilley Endurables in exotic locales. You can control the results to some extent by providing examples of the kind of submissions you’d like to receive. As a bonus, what you receive may provide some insight into your customers’ minds.

Think your brand could use a boost from the grassroots? Effective communications thrive on three key aspects: how a message is delivered, who delivers it, and what the message is. We have found that who delivers the message can be as important as how the message is delivered. Messages from peers are often perceived as more genuine, and may provoke a greater response. And that’s the key to grassroots marketing.

Like any marketing campaign, engaging your customers in content creation requires heads-up planning and clearly stated objectives.

Search marketing and your brand

"Memo to brands: fear the wiki," states Sandeep Krishnamurthy frantically. I don't agree.

Krishnamurthy's point is that when you search your brand, one of the top results is the Wikipedia entry. And Wikipedia, given its aim to be the online user-generated point of reference encyclopedia, might say something you don't want to hear about your brand. After carefully crafting your image, turn of phrase and vivid brand personality, the supposed objectivity and authority that Wikipedia exudes can "muddy" your brand's waters.

Well, yes, of course the brand waters are muddied. You might create your brand, but you don't own it. Your customers, clients and the public at large do. Say, for example, you put a lot of work into a new wordmark, colour choice, motto. But your customer service people don't stay on message when they answer the phone. What is your brand then? "Nice logo, shame about the folks on the phone." That's your brand.

Your brand's Wikipedia entry can be an excellent research tool. It can tell you what matters about your goings-on in the world. Read it, engage with it. And work on fixing what Wikipedia says is broken through a combination of pro-active communications and changes to the fundamentals.

Why wait? Web 2.0 is here to stay.

My colleague Tim and I recently attended an intensive one-day course in Montreal on the subject of social media marketing and Web 2.0. It was instructed by Mitch Joel, Owner of Twist Image (a digital media company in Montreal), and social media guru. I thought it was extremely well presented, and the content was a perfect mix of explanations and examples. I emerged at the end of the day feeling energized and excited to share all I had learned with my coworkers, not to mention, the rest of the world ;)

Web 2.0 seems to be all we’re hearing about these days - and rightly so. Mitch explained that this industry (marketing, advertising) has changed more in the last 2 years than it has in the last 20. He gave some startling statistics on web use – who is using it, how they are interacting with it, what they are doing and why. The hard numbers make it all very difficult to ignore, and hearing it inspired me to make a point of absorbing everything I can on the subject from here-on-in. Did you know that in 2006, Canadian online advertising exceeded $1 billion?! (IAB Canada)

Here's a brief list of things that I feel are definitive of the Web 2.0 concept, and what social media marketing is all about:

- Hands-on (user-generated content ie/YouTube, and virtual worlds ie/Second Life)
- Wikipedia
- Blogging
- Podcasting
- Wikis
- Syndication
- Tagging (ie/ Del.icio.us)
- Social Networking (ie/ facebook, MySpace, Linkedin)
- Viral Marketing
- Mobile devices

Participation, as opposed to push or pull, is the name of the game. Consumers want to feel a part of your brand, and so by allowing them to contribute by creating - they are helping to shape it. This also prevents your marketing campaign from fading into the background and from fading too quickly – if people are interacting with it you can be sure it lives on!

If there was ever a time that cookie-cutter approaches fail - it's now - today and tomorrow. We all must start to embrace Web 2.0 and make the necessary transition in the way we approach marketing our products and services.

Google Streetview

As I'm sure most of you know, Google is now offering a new service called Street View - associated with Google Maps. I've been fascinated by Google Maps - particularly the satellite view: I could see my own car parked in front of my house in the closest view of my neighbourhood. There was something cool, or different, about perceiving the world from above and I have often wondered if this had an effect on how we humans see ourselves. Well, now it's time for a new question: how do we see ourselves at a street level? Will Street View change our perception of space and what we do it public?

Web 2.0 - the other revolution

I held a couple of round-table discussions on Web 2.0 at the Marcom conference in Ottawa this past week. I spoke about Web 2.0. I began my discussion by defining the concept and talked about how Web 2.0 is both a set of tools and a change in attitude among consumers. We had a great discussions with some great folks in the public and not-for-profit sectors. Almost all of them are planning the next generation of their web presence to take into consideration the immense opportunities that Web 2.0 tools support.

I came away with as many questions as I had tried to answer in the conference. If the tools have changed, and end user attitudes have changed, what needs to change inside an organization to make the most of it? How do people and organizations move from considering their websites as a technical issue toward a platform for dialogue? Could this be the other Web 2.0 revolution?