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PostHeaderIcon Google TV: TV Advertisers Should Be Mad as Hell

The big announcement at Google I/O last week was the release of details about Google TV.  And it should make TV advertisers of all stripes angry and concerned.  VERY concerned.  So much so, in fact, that they should be actively seeking technologies and business models to deflect/prevent what is effectively an advertising power play by Google.

Google TV is the latest attempt to merge the television experience with a web-based TV (also called IPTV) experience on the television set (as compared to bringing TV to the web, as say a SlingBox does).  There have been numerous attempts to bring the Web to the television, going back all the way to 1996 when Steve Perlman, Bruce Leak and Phil Goldman brought to market the WebTV set-top box, marketed by both Sony and Phillips.  (Find a list of TV/Internet hybrids in the next post).  None of these has been particularly successful, for numerous reasons:

  • Most require an extra set-top box that is expensive (Google is no different.  As an example of technology that uses the consumer’s  computer or laptop as the interface to the TV, see Kylo).
  • The experience doesn’t truly integrate.  You either watch the web-based offerings or Live TV, but not both at the same time.  In many cases, the box is meant for the delivery of movies or TV shows on-demand, as compared to being broadcast in real-time.  The Roku/Netflix platform is an example of this.  PopBox is another example, but they also deliver more content – websites, social media experiences from Facebook and Twitter, images, YouTube videos, games, and music from sources like Photobucket and Pandora.
  • The interface requires a separate remote control, which adds another layer of complexity to the consumer experience.

None of these really impacts the effectiveness of a “single” broadcast TV advertisement in any meaningful way.  They are separate experiences from broadcast television and, as a rule, they do not take away from live TV viewership.  Some amount of consumers’ time is given to the Internet and movies on-demand nowadays.  Whether I interface with that experience through my computer screen or TV screen doesn’t change the amount of time I spend in an “online” mode versus a TV viewing mode, and it does not impact my current behavior around the TV ads themselves.

Google TV has come up with a different approach which, at least during an initial search, overlays the Internet on top of the television experience (see first image).  When it overlays, the interface is transparent so you can see your TV behind the browser interface that lets you search for the shows and information you want.

Google TV transparent interface

There are other times when the interface switches completely and the TV experience is put on hold while the viewer interacts with Web content (see second image), which is more like the experiences of the current generation of web-to-TV offerings.  But the difference here is how easy and seamless Google TV makes it to switch between all three of these user experiences – live TV, TV in the background, and Internet-only.  The other difference, and one of critical import for this article, is that Google intends to sell advertising within the Google TV platform.  Where, how, and how much are still to be determined.

Google TV solid menu interface

Google has definitely come up with something unique that I believe will be very compelling to television viewers as it now truly integrates the television and web experiences for the first time.

But if the consumer loves this, traditional TV advertisers should hate it.

Today, television advertising is a $70B market versus $25B for Internet and mobile search advertising.

US Advertising Market Revenues 2009

In 2010, TV advertising is projected to grow 4.3%, or $3 billion on a base of $70.2 billion. This compares to non-search on-line advertising which is projected to grow 12.9% or $1.6 billion on a base of $12.2 billion during this period.   So even though Internet advertising is growing at a faster rate, television advertising real-dollar growth is twice that of Internet advertising.

Google knows this.  Rishi Chandra, the  product manager for Google TV, mentioned the $70B factoid at Google’s I/O conference last week.  Moreover, Google also gets that despite the fact consumers are spending an increasing number of hours per day online,  television viewership is at an all-time high, with 180mm US consumers watching TV for over 5 hours/day on average.  Rishi mentioned this, as well. The guys at the Googleplex are no dummies. As the old saying goes, they can see a mountain in time. In this case, the mountain they want to cash in on is TV advertising.

What both Google and the advertisers also know is that television advertising is broken.  In 1987 an advertiser could reach 80% of viewers by airing a 30-second spot only three times. Today, that same commercial would have to air 150 times to reach 80% of viewers.[1] The rapid decline of TV ad viewership is due to the “TiVo” effect and today’s viewers’ multi-tasking habits – texting, phoning, emailing and web surfing while watching TV.  Brands are urgently seeking a solution to reengage viewers of their TV commercials as brand expenditures on television dwarf what they spend on all other ad mediums.

Now Google would argue that it has found the solution, and from its perspective I truly think they believe this.  The Google culture is driven by data and metrics.  Current television advertising with its lack of performance measurement is anathema to a Googler’s mindset.   If you are a fanatic about data-driven marketing, Google TV “solves” this problem because of its ability to bring CPC and other easily measurable formats into the web-based part of the new integrated television experience.

Interesting and correct as far as it goes.  But wrong – and I mean dead wrong – from the perspective of television advertisers who focus 3x of their dollars on television versus online advertising because it is still the most potent means of getting a message to the consumer.  Moreover, it is a power play by Google to disconnect the brand advertisers from their traditional advertising providers and drive them, willingly and like lemmings, onto the Google platform(s), thus providing Google an even stronger power position relative to advertisers.

Let’s think about this.  Television advertising is already much less effective than it used to be.  Now along comes Google TV with its overlay and ability to seamlessly move away from the live television experience.  Let’s say you are a viewer watching Lost, that you are using Google TV, and you have left your laptop in the other room because – heck – you don’t need a two-screen solution to access the Internet during live television now that you have Google TV.  Something on the show triggers you to want to look up some factoid on the web at a Lost fan site.  You plan to type in “Lost fan site.”

When are you going to type this in?  During the time the episode is airing?  Absolutely not.  You’re not going to want to miss one minute because Hurley is about to tell Jack his real name.    Or take another example – a sports case.  Are you going to put the potential touchdown play in background mode while you look up Brett Favre’s completion percentage in third down and long situations?  Absolutely, positively not, to the extent that the sports fan is thinking “don’t you dare touch the remote or there will be one less thumb in this family.”

No.  You are going to switch to the Internet experience when the television ads come on and you can safely move away from the live broadcast to find what you need before your show comes back on.

There is another interesting fact that only makes this seem a more likely behavior on the part of cross-platform TV viewers, at least the early adopters of Google TV.  In a recent study of US Online TV Viewership by Comscore involving 1,800 subjects, a majority (67 percent) of cross-platform (TV and online) viewers preferred online TV viewing because it has less interference from commercials[2].  Since these folks are the likely early adopters of Google TV, the tendency to move away from live TV during commercials will be very strong.

So what does Google TV do?  It makes the television ad spend of the major brands even less effective than currentlyBecause Google TV still provides an interruptive experience, it actually encourages cross-platform viewers who wish to increase the “information content” of their viewing experience from web-based channels to do so at the exact time that advertisers least want them to do so.

There is an even bigger implication of this for brand advertisers.  In order to keep the cross-platform consumer’s attention as they move away from viewing television ads, the brand advertisers will be forced to place their ads on the web-based portion of the Google TV interface.  And to a certain extent this makes sense going back to our previous point about measurability of TV advertising.  The Google platform is measurable and consumers more and more are becoming habituated to interacting with web-based CPC or banner advertising.  So the TV advertiser keeps the attention of the cross-platform viewer during the commercial break in the show and gets better metrics.  It’s an obvious win-win for both Google and the advertiser, and a very seductive business proposition to marketing executives looking for better measurability around TV advertising.

But for TV advertisers, Google TV is the equivalent of the poison apple given to Sleeping Beauty.  As Google TV penetrates households, more and more TV viewers will become habituated to the dual-use experience and will spend more and more time on the Google platform during broadcast television advertising pods.  And despite the fact I haven’t said much about mobile in this article until now, Google TV will also move onto the mobile platform and will provide an even more integrated experience for the consumer across the two screens, with a whole host of implications for the two-screen experience that I won’t discuss here.  Given the timing of historical consumer behavior transitions in the television market, this could take ten years. But over that time, Google will take a larger and larger share of the currently $70B TV advertising and the $2.7B mobile advertising markets.  This means that as much as an advertiser is currently dependent on Google for web advertising, they will become even more dependent on the single provider that is Google because of its reach in these other channels.

If you as an advertiser aren’t concerned about the implications of this for your business, where Google can set effectively monopoly prices you pay for ads across every major advertising platform you have, you should be.  You should be very concerned and mad as hell at this attempt to manipulate your advertising dollars even further into the maw of the machine that Google has become.

If I were a brand advertiser right now, I would be talking to my peers and looking for a second-platform solution from someone that can constrain this power play by Google before it becomes a fait accomplice.  If I were Yahoo or Microsoft, I’d be developing or investing in a prototype of something I could show to brand advertisers today and get them to invest strategically in order to prevent Google from locking up this market before it is too late.


[1] “Advertising is Dead, Long Live Advertising” Himpe, 2008

[2] Yuki, Tania “Comscore Study of US Online TV Viewership.” http://www.comscore.com/Press_Events/Press_Releases/2010/4/Viewers_Indicate_Higher_Tolerance_for_Advertising_Messaging_while_Watching_Online_TV_Episodes

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PostHeaderIcon The End of The Chasm and the Beginning of The Rapids

I’m back at it after travel to SMX Advanced London, where I had my first speaking opportunity as the CEO of OnlineMatters.  Now that I’m clear from that presentation, it’s time to get back to the topic of my prior post (not) crossing The Chasm.

In my last post, I posited that The Chasm, as far as Internet-based businesses are concerned, is quickly disappearing.  Let me explain why and why The Chasm has now been replaced by what I call The Rapids.

The Chasm exists because of the disconnect between

  • The time/resources needed to evolve both a high-tech product and business model from meeting the needs of early adopters to support the larger market segment – the early majority.
  • The money available to fund this transition, which is limited by the size of the early adopter market.  The available funds are not likely to grow until the early majority purchases the product en masse, for two reasons. First, because sales generate cash.  Second, because sales validate that the business model and product features are now positioned for scale, thus increasing the company valuation and ability to attract new third-party capital needed for growth.

Voila – A Catch 22 and birth of The Chasm.

But today’s Internet-based business startups work differently.  Thanks to new technologies and approaches to IP (open APIs, open source licensing, crowdsourcing, cloud computing, mashups), software products that used to take months and years to conceive and develop using a large number of engineering and marketing resources, can now be brought to market in a few weeks by two-three people in a condo (Sad to say, the garage crowd went upscale in the late 90s in Silicon Valley and have never really returned to their roots in the humble garage).  Without a lot of effort, they use word-of-mouth and viral techniques, as well as search engine optimization and perhaps a little PR, to acquire an initial set of customers who hopefully like the product and tell their friends.  If they are smart, they add a customer feedback tool like getsatisfaction or uservoice to their sites and begin collecting immediate, extensive, and continuous feedback from customers.  They plow this feedback into the product using daily or even hourly code pushes.

The difference in speed of product evolution between traditional high tech startups and Internet-based business startups is like the difference between the gestational period of an elephant and a virus. And that difference is one of two reasons The Chasm is quickly shrinking, and ultimately disappearing, for Internet-based business startups.

While products in both cases evolve in discrete steps, the size of the steps in the case of an Internet-based business are relatively small and from day to day customers do not see huge changes in the product they are already familiar with.  However, they get to use the product even as it is evolving, unlike the case in more traditional hardware or software businesses where customers can only engage with a new set of features when they are released in large, discrete “chunks” and not before.  As a result the early adopters are brought along even as new customers try the product.  Each step involves a group that more and more reflects the larger majority of customers until at some point the product meets the needs of the earliest of what would have been called the early majority –  who also happen to be the latest of the early adopters.  There is no ability in this case to find a demarcation between these two groups.  Customers’ perceptions of the product and their needs from the product change as the product itself changes because they experience those changes in small steps as they occur.  Obviously some early customers will chose to leave the product as it evolves, but that is true of any product at all times as customer attrition is a fact of life.  Rather, the customer need and product feature evolve in tandem in a virtuous cycle, removing any need to leap between one set of customer expectations/needs and another.

So on the one hand, the capital requirements for an Internet-based business startup have declined (and continue to decline) substantially, while the time required to evolve the product and engage customers in its evolution continues to shrink.  As a result, the challenge for Internet businesses is not The Chasm, because it effectively doesn’t exist any longer.

The new strategic challenge for Internet-based startups is sifting through the reams of data available – customer feedback, site analytics, Twitter feeds, Facebook fan pages, competitive data (of which there is much more today than ever) –  in near real-time and clearly identifying the critical strategic requirements for the business and product requirements needed to serve the core customer segments.  Whereas the traditional high tech startup has difficulty getting enough feedback and making enough changes in a short enough time to perfect the product and business model, the Internet-based business startup faces the problem of determining the key insights from a plethora of data (“the rocks”) and making those insights actionable in time frames that are more logical for a supercomputer than a human being.    More importantly, they need to have the discipline to avoid taking on too many strategic imperatives (“oversteering”) and not over-evolving the product because…well…because it is relatively easy to do.    The Internet startup isn’t crossing a chasm.  They are trying to avoid the rocks and not oversteer their course.  They are navigating The Rapids.

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PostHeaderIcon Eich Bin Ein Mobile Netizen

Like many I have an iPhone. Admittedly I still have a 2G because I’ve become more thrifty in my old age (funding a national-level gymnastics career and private school tuition will have that effect) even at the risk of having my Silicon Valley friends call me a technology troglodyte. But I am an avid user of all the main apps (I can bump with the best of them), use it for location-based searches (e.g. AroundMe, Google maps), send images to Facebook, Tweet in real-time at events, Ping when I can, check my blog traffic with Google apps for the iPhone, and know how to plan/execute advertising campaigns specifically on mobile phones. No one who knows me would say I am in any way behind on my use of mobile technology.

But until now, I’ve never felt like mobile has really changed the basic way I have experienced the world. I go to trade shows and listen to all the ideas for the latest mobile services or how mobile concepts should change my daily life, but I have never felt that I had crossed a Rubicon with the real-time nature of mobile in the same way I did when I got my first laptop or sent my first Tweet.

That changed yesterday. I had the pleasure to take my family to a performance of The Smuin Ballet at the Sunset Center in Carmel. I am an admitted ballet snob, and Smuin is a wonderful company with talented, disciplined dancers and creative choreography. So whenever they are in Carmel we go to see them. The second act was a performance of Smuin’s Medea, which was first performed in 1997. It is a dramatic ballet that retells the story of Medea, the wife of Jason, the intrepid explorer of Jason and the Argonauts.

The myth of Jason and Medea is a dark and haunting tale of revenge and self-destruction. But in the dark as the curtain rose on Act 2, despite being a student of mythology, I couldn’t for the life of me remember even the outlines of the tale to tell my wife and eight year old daughter, neither of whom knew the first thing about this particular myth.

So what did I do? I pulled out my handy iPhone and while shielding it so as not to disturb others, I did a web search on Medea and pulled up the Wikipedia entry.

Despite the dark and small print, I was able to glean from Wikipedia the details of the story. Jason met the sorceress Medea, daughter of King Aeetes of Colchis. Medea falls in love with Jason, and he convinces her to help him to acquire the Golden Fleece in return for a pledge of marriage.  After acquiring the Fleece, Jason and Medea flee to Corinth and have children. In Corinth, King Creon offers his daughter Glauce to Jason in marriage, and Jason feels he cannot pass up the opportunity to marry a royal princess. Despite explanations and promises of support from Jason, Medea feels betrayed. She gives Glauce a wedding gown covered in poison that kills the bride. Then to ensure that nothing of Jason’s will outlive him, she kills their two sons.

I quickly related the story to my wife and daughter (who was especially engaged by the dark and intense drama onstage).  I then sat back and enjoyed the performance, knowing that they now could now understand what they were seeing and, as a result, enjoy it with more insight.

Not a big deal, you might say. I say otherwise. Prior to this, I had used my mobile capabilities to get directions or find a resource nearby. I was using the mobile device as a tool for location-based information. It was a parallel use to a GPS, which while practical, was not a fundamental change in my experience over a map. It was easier than a map and had better information, but the experience was just a replacement of one form of information (paper) for another (digital).

In this case, for the first time I used my iPhone to plug into the wisdom of the commons, into the global village, to enhance and extend the quality or content of an experience.   In other words, the phone and the information it provided in real-time became an integral part of the experience, although it was unintentional (from the perspective of the choreographer or the dancers) and because it was unintentional, it was distracting. But this little thing, this one act, was a fundamental change in how I interacted with the world. This was not a substitution of paper-based data with a digital version. Instead it delivered the true promise of the mobile web. It allowed me to access a completely new set of information that was then added to a real-time, real world event to enhance the experience. The equation is real-time event + Internet information = a real-time multimedia experience.

Admittedly, the experience was not perfect because it wasn’t intentionally developed by the show’s producers. But what if Smuin developed a mobile video app that during the Intermission allowed audience members with iPhones to see the full story of Medea in an entertaining way that also tied the story to how the ballet attempted to recreate that story in dance. That would be a more intentional, and less invasive, way to provide the same integrated (but completely new) experience.

So yesterday for the first time, I experienced the true power of the mobile web.  I can now say “Eich Bin Ein Mobile Netizen.”

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PostHeaderIcon Social Media Strategy and Search Engine Optimization – You CAN Own the First Page

I have been talking in my last few entries about the power of social media channel architectures for search engine optimization and brand building .  It’s always hard to understand these approaches or their true efficacy for SEO in the abstract.  Is this just a nice idea or does it really work?  In a land where data talks and you-know-what walks, do you have data to support the ROI on creating a social media channel architecture?  Can your really move the needle on the SERPs and, if so, how much?

There are many more well-known than me in SEO – Adam Audette of Zappos for one, and Jordon Kasteler of Search and Social for another – who I didn’t realize were mining the same path and have reported results of their efforts.   But I can now also provide substantiation of my techniques, which are especially strong for “easy to rank” and “moderately difficult to rank” keywords and which I am about to test on painfully competitive keywords.

Shown below are two results of my social media channel strategy.  Both of these are from posts on this blog, which is based on an SEO optimized version of WordPress.  The first was a post that was done on September 26 about .htaccess files.  The search was done on October 5 while I was at SMX East.  I was writing a primer on htaccess grammars.  I wanted to rank on that word so new SEOs (and maybe experienced ones) would find me.  Traffic isn’t the issue with this post – reputation management and brand building are.  It is part of my strategy of trying to become a top SEO in the industry (for those who don’t know me, I am a fierce competitor and don’t know how to set small goals).  So it was ok that it was a low-traffic word. 

In this case, I was able to rank in 9 of the top 10 positions after one week – basically my entry owns the first page.  This happens because I don’t depend on my blog to rank.  Bill Joy of Sun, who I had the pleasure to work with while I was on the Java team, used to say “95% if the smart people in your industry don’t work for you, so need to find a way to leverage their intelligence for your success.”  That is Joy’s Law, and it is one of the conceptual underpinnings used to market Java in its early days.  Well, similarly in SEO, my social media strategy leverages the intelligence and resources of bigger organizations to maximize my content’s impact for search engine optimization purposes. 

Figure 1
Rankings Using Social Media Channel Architecture for the Keyword “htaccess grammar”

While my blog ranks first and second in the SERPs, as well as nine and ten, the other entries (3,4, 6, 8) are from what I call the social media amplifier – as my entries flow through Friendfeed, youare, Twitter, and identi.ca.

Very low volume, very low competition keyword.  OK.  Here are the results for a search on “social media channels”, which is higher volume (73 searches, but still low).  Note that the blog holds positions 1, 2, and 5, but the higher positions are due to the SEO power and flow through from Tweetmeme. The post was published on September 8 and, sad to say, I don’t have the search date, although I believe it was around September 15. (You will note I failed to capture the top of the search page – but I hope you will trust my reporting for this one time). 

Figure 2
Rankings Using Social Media Channel Architecture for the Keyword “social media channel”

Search results for social media channels

Also if you search today for “social media channel architectures” (the keyword I optimized for) you will find the entry in Positions 1,2,3, 4, and 5 due to leverage of Tweetmeme and Friendfeed. 

Realize this is before the creation of any special content specifically for social media sites – such as an article on hubpages or knowl, or a presentation on slideshare.  What would happen to that content through the amplifier still needs to be tested.

My next experiment will be to try this approach on really tough keywords.  We’ll see then just how much effort it takes to rank there. 

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PostHeaderIcon Social Media Channel Architectures – Part 3

5AM in Paris, and here I am back writing.  Talk about dedication.  But at least there is a French Roast and petite dejeuner at the end of this. 

Installment three of our series on social media channel architecture. To catch us up: in Part 1 we discussed the strategy and theory of social media channel architecture. In Part 2, we conceived a new product called Greensoap which has three unique advantages: it sends fewer harmful chemicals into the water supply, it doesn’t get mushy when stored, and it is 50% cheaper than other leading brands.  This product appeals to three unique market segments we have identified on an attitudinal and behavioral basis: The Green Consumer, The Vacation Traveler, and The Thrifty Shopper. We mapped these consumer segments to their preferred media (video, graphics, audio, text), their most used technology platforms, and the likely sites/online social networks they participate in.

My blog posts tend to be long as a rule, and I don’t want to make them any longer than necessary to make my point. So for the purposes of this and the next few installments, I am only going to focus on the example of The Green Consumer and provide general outlines of how to create an online social media campaign to engage them.

The first step is – duh – to research sites and other programs that companies have done to engage these consumers. If there is any truth about Internet marketing it is that there is always someone out there who has done something similar to what you would like to do and the easiest way to generate new marketing programs is to explore what has been done and use that as a jumping-off point for your conceptualization/brainstorming.

The first question I have is what green-specific social media networks are already in existence that I could leverage and where I might find a very focused target customer based for my products. Realize that these networks are probably small relative to a general-purpose social media network, but they will provide a good place to test engagement with the audience and an excellent seed location for any programs we may conceive. So I search on "green social media networks" and get the following results:
 
Google search results for "green social media channels" 

What I find most interesting is how much activity there already is in this space – let’s just do a quick breakdown:

Green Social Media Networks:  CarbonCopy.com, Climateculture.com, Greenlinkz.com, Greenedia.com, Gaia.com

Blogs: earth2tech, lohas.com/blog

Campaigns: ClimateCulture: America’s Greenest Campus, Carbonrally: Seventeen Campaign

Downside issues: GreenMyApple from Greenpeace 

Time to get out and about.  We will continue the implications of our research tomorrow.

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