Monthly Archives: June 2016

You Need To Own It

Since today is something called “Social Media Day” (when is it not?), I’d be remiss if I wrote about something other than a big topic in social media. Depending on your perspective, Facebook announced something yesterday that will either have you jumping for joy or throwing your hands up in frustration. As they put it in their announcement:

Facebook logo Español: Logotipo de Facebook Fr...

(Photo credit: Wikipedia)

We’ve heard from our community that people are still worried about missing important updates from the friends they care about. For people with many connections this is particularly important, as there are a lot of stories for them to see each day. So we are updating News Feed over the coming weeks so that the things posted by the friends you care about are higher up in your News Feed.

Can’t get enough of those pet pictures, I know.  But if you’re a publisher who has carefully cultivated a Facebook community over the last few years, this is really bad news. It decreases the likelihood that your audience will see your posts. When Facebook has become the source of a significant portion of your traffic (research says in the 40% range for many publishers), that’s not good. As an aside, there is more good information on this here.

Of course, the cynic in me wants to remind you that one can always purchase traffic from Facebook via ads and that despite Facebook’s statements that this is only to serve users who want to see those pet photos, it’s really a move to generate more ad activity. That’s fine. Facebook is there to serve its shareholders and it’s a business.

What this should also serve to do is to remind us that we need to own the audience and the platform. We can’t rely on third parties such as Facebook or Google to keep our communities (and content) front and center.  History tells us that the rules will change and that those platforms will come and go (Friendster, MySpace). Your community isn’t a bunch of bedouins who will decamp and follow you anywhere.

I’m always amused when a client asks if they should invest less on their own website and more on building a presence on third parties. You can guess my answer: own it! Do you?

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Snapping Up Value

The hottest platform in social media these days is Snapchat. I’ve been a user for quite some time and I’m not sure I completely get how to use it yet. I’m amazed by the stories of those who do even if I’m discouraged that they all seem to be under 15.

As with all things eyeball related, advertisers are flocking to Snapchat because FOMO. Snapchat recently surpassed Twitter in terms of average daily users and even Facebook is feeling the heat as evidenced by their development of a Snapchat-like product. When you’re hot, you’re hot! Of course, heat has nothing to do with the success of a business unless it’s translated into revenue and profit, and so the Snapchat folks are actively selling themselves to marketers.  It’s therein where lies today’s business thought.

Advertisers are complaining about both the pricing and investment level needed to gain access to the Snapchat audiences. This from the Digiday folks:

Snapchat started selling ads in late 2014, and early products — one that went to every user and disappeared within 24 hours — cost about $750,000. In 2015, Snapchat brought down the price for video ads to 2 cents a view, or $20 for 1,000 views. This year, prices were back up with premium animated lenses that could cost millions depending on how many an advertiser bought in a given day, and interactive ads, where users can swipe up for more content, cost about $55 for 1,000 views.

I’ll agree that the level of investment required here is steep, even for big brands.  Other than special events, most unit investments in various media don’t require close to a million dollar outlay.  Obviously, and perhaps by design, the pool of advertisers becomes rather limited as well. Providing an API that will let marketers serve ads through third-party technology companies with a smaller outlay makes sense.  But that’s not the business point.

Where I disagree with Snapchat’s thinking is in dropping the CPM. We can’t ever allow price and value to become confused, whether we’re selling media or anything else. This platform has tremendous value – which I measure by both reach and engagement – and to drop pricing is a mistake. It’s the same thinking we faced in my TV days when trying to sell Super Bowl ads. High CPM? You bet. Tremendous cash outlay? Uh-huh. But the value of that exposure is unlike anything else in media, and in the nearly 20 years since I sold my last Super Bowl ad the value has only gotten higher.

The cost/value equation is one everyone in business needs to learn. Have you?

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Going Backward Is Dumb. Looking Backward Isn’t.

There was a story in this morning’s paper that had me shaking my head once again. Seems as if it’s a daily occurrence, I know. This one got me thinking about the things we can take away from the subject and apply to business, which is also a daily occurrence. The story was about our shared stupidity and our general refusal to learn. Let me explain.

Here is the headline: American Drivers Regain Appetite for Gas Guzzlers. I’ve linked to the story but as you can imagine it has to do with many people giving up their fuel-efficient cars to buy gas guzzlers as the price of gas has fallen. Of course, in addition to adding a lot of room to the passenger compartment, these vehicles also add a lot of greenhouse gasses to the atmosphere, and unless you’re one of the few who are ignoring virtually every scientist on the planet, that is creating a changed climate for us all.

I’m not ranting today about the politics of this. To me, it’s not very different from what a lot of managers do in their own businesses. The higher price of gas was a crisis. Many car owners adjusted by decreasing driving, buying more efficient vehicles or using mass transit if it was available. Most good managers do the same sort of thing in a crisis. They cut spending, focus on business development, eliminate inefficient product lines, and do all of the other things one can do to continue on until the crisis has passed. What the great managers do is to continue to operate with that mindset even after the crisis is long gone under the assumption that the same problem or another one is virtually certain to rear its head at some point. That doesn’t mean they fail to invest once conditions have improved. It does mean that they learn from the crisis and adjust and they don’t go back to doing exactly what they were doing before.

I own a hybrid and my family owns two others. I can’t see going backward with respect to fuel efficiency and greenhouse emissions no matter how cheap gas becomes. I try not to go backward in business either. Going backward is dumb. Looking backward and learning isn’t. Your call.

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