It is worse than we thought, reports Ad Age. A study of consumer habits commissioned by Time Warner and conducted by Boston’s Innerscope Research found that consumers in their 20s (the so-called "digital natives") switch media venues 27 times per nonworking hour; roughly 13 times during a half-hour TV broadcast.
The study had just 30 participants, and as Ad Age described it, offers some insight into a generation that “always has a smartphone at arm's length and flips from a big TV set to a smaller tablet screen and back again at a moment's notice.”
The study was a 50/50 mix of digital natives and “digital immigrants” who grew up on TV and radio, but adapted to smart phones and
The study's subjects were split evenly between natives and "digital immigrants" (consumers who grew up with old-school technologies, such as TV, radio and print, and adapted to newer ones). The immigrants showed more patience, switching media venues 17 in a nonworking hour versus 27 for the natives.
The participants wore both biometric belts to measure their physical responses, and glasses with embedded cameras to track their platforms and durations while watching 300 hours of programming. They channel- and media-surfed at a dizzying rate, “Looking for…engaging content, and they dismiss so much stuff,” Dan Albert, senior VP-media director at Chicago's MARC USA agency told Ad Age.
The challenge, said an interviewee from Unilever, becomes that if consumers are “snacking” on short amounts of input, then marketers and advertisers must communicate in “snack-like bits of messaging.” Unilever owns both the Dove and Axe brands, among dozens of others.
One (expensive) method of capturing their attention is to “surround” consumers with ads that appear across several venues, as long as the viewer is tuned to the same content. So American Express might run a print ad in a magazine, plus pre-roll ads on the magazine’s digital version and smartphone and tablet apps. Presumably, Facebook and targeted ads reach those consumers as well, for additional exposures.
A Q4 2011 Nielsen survey found that 45% of U.S. consumers who owned tablets use them daily while watching TV, with similar results among smart phone users.
The average cost-per-click on a Google search ad returns a value of $10 per click for each keyword, finds a Washington University (St. Louis) research team. Maybe more.
As the university describes, the researchers found that the value of Google search advertising is grossly underestimated, because conventional methods of measuring return on investment (ROI) of online search ads fails to account for “cross-channel sales spillover.”
Dr. Tat Chan of the university’s Olin Business School and his colleagues developed an empirical method that to estimates the lifetime value of customers acquired from search advertising, and from multiple data sources. This method provides advertisers with a long-term and more complete measure of the value of customers acquired via Google search.
Google’s total advertising revenues in 2010 were $28 billion, up from $439 million in 2002.
As the researchers described, an advantage of search advertising is that it creates a better fit between a potential customer’s needs and the advertised message. It reaches a large audience with immediate interest in the product, so, both stimulates sales among existing customers and helps acquire new customers.
But conventional methods of measurement were insufficient. They “Just [look] at online transactions, that are one-time transactions,” says Ying Xie, PhD, associate professor of marketing. “But in our method we propose that we should think about the customer’s lifetime value…they could be an active customer, repeatedly making purchases. The cumulative amount of these purchases — that’s the profit stream we should take into account.”
The researchers merged web traffic and sales data from a small U.S. company to create an individual customer-level panel that tracks repeat purchases, both online and off-line, and identifies if those purchases were referred from Google search advertising.
The results demonstrated that customers acquired through Google search advertising showed a higher transaction rate than customers acquired from other channels. Taking into account future purchases and spillover to off-line channels (e.g., the customer bypasses the web for a second purchase), the calculated value of new customers is far higher than the value obtained using conventional methods.
The team developed an integrated model of customer lifetime, transaction rate and gross margin. Based on their model’s estimates, they find that the firm would incur a loss of $48 on average to acquire a new customer if using the conventional method. But after accounting for sales spillovers across channels and the long-term effect, they estimate the value of customer acquisition as high as $950 per customer.
The challenge of this new multichannel online/offline methodology is that it is not yet standardized; Nielsen, comScore and other companies are still perfecting the methods of quantifying exposures across media: quantifying the ultimate ROI is the likely next evolution.
The team presented its findings in its paper, “Measuring the Lifetime Value of Customers Acquired from Google Search Advertising,” which took the University’s 2012 Olin Award for relevant and performance-enhancing applications to critical management issues. The Olin Award for faculty research was initiated in 2007 by Richard Mahoney, executive-in-residenceat Olin and former chairman and CEO of Monsanto Co.
- A New York appeals court has resurrected “an epic copyright case over whether Google should be liable for movies and tv shows uploaded to YouTube” during its early days, reports PaidContent. A lower court judge had dismissed the case in 2010 stating that Google was protected by a “safe harbor” law distanced hosting sites from infringing content uploaded by third parties. Viacom counters that Google actively enabled and encouraged the practice, and claims it is owed $1 billion in royalties over 79,000 clips of shows like “John Stewart” and “South Park.”
- Twitter is opening offices in Detroit, “looking for better proximity to car companies with hefty ad budgets” according to a Reuter’s story. This following a notable financial recovery by General Motors Co, Ford Motor Co and Chrysler from years of restructuring and depressed auto sales. Google. Google claims it will have a "handful" of employees in Detroit, focused on working first-hand with automotive brands and advertising agencies.
- Elsewhere in Twitter news, it is actively protecting users and advertisers against spammers. The company said on its blog that “Our engineers continue to combat spammers’ efforts to circumvent our safeguards, and today we’re adding another weapon to our arsenal: the law…we filed suit in federal court in San Francisco against five of the most aggressive tool providers and spammers. With this suit, we’re going straight to the source.” As ClickZ details, the defendants include three companies and two individuals: TweetAttacks; TweetAdder; TweetBuddy; James Lucero; and Garland Harris. “By shutting down tool providers, we will prevent other spammers from having these services at their disposal,” stated Twitter.” Further, we hope the suit acts as a deterrent to other spammers, demonstrating the strength of our commitment to keep them off Twitter.
- Facebook is also cracking down on spam, reports ClickZ. It has filed three separate lawsuits in federal court this week, alleging violations of the U.S. Computer Fraud and Abuse Act, (known as CAN-SPAM). The suits name two individuals, Steven Richter and Jason Swan, and one company, Max Bounty, Inc., of “using deceptive practices to trick Facebook members into handing over personal information, spamming friends or signing up for fake offers.” These filings come just two days after the Wall Street Journal alleged that makers of the top-10 Facebook apps (including Zynga of FarmVille fame) were transmitting Facebook User IDs to outside companies, violating Facebook's terms of service. Bad timing, with an IPO pending that is heavily dependent upon advertiser value.
- Time Warner Cable is promising an app for Android-based phones and tablets before Memorial Day, reports Multichannel News. But, not many Android devices currently on the market will be able to run it. The TWC TV app will run only on devices that support Google's Android 4.0 (known as “Ice Cream Sandwich”), and which few devices yet support. Still says TWC, it is “The only version of the Android OS that allows us the security and stability necessary to distribute video over our private network." The TWC TV apps for iPad released in April 2010, followed by versions for iPhone and iPod touch.
- Fox has taken an equity stake in an interactive television technology provider (ACTV8), reports MediaBistro. Fox will "ACTV8" several its primetime series, beginning with the “New Girl” second screen app, now which is available on iTunes App Store for iPhones and will be available on iPad and Android platforms in the coming weeks. Using the apps, viewers can interact during live broadcasts of Fox shows by chatting in real time, earning badges by watching and answering episodic trivia.
- In search-engine marketing news, Microsoft's Internet Explorer (IE) browser has started to regain share of the browser market, reports ClickZ. It does so at the expense of rival browsers, particularly Mozilla's Firefox and Google's Chrome. According to data from Net Applications, IE has increased its market share by 2% from December 2011 to March 2012, for a total of 53.8%. The browser was losing share before that, losing more than 5% of users between May and December 2011. Firefox usage has declined since May 2011 through March 2012, dropping 2% for 20.6% of the market.
- Turner Sports lost some digital traffic with its streaming NCAA coverage, reports Multichannel News. Between paid subscriptions and the trials of TV Everywhere authentication, Turner Sports traffic to NCAA.com and March Madness Live broadband and mobile services declined 6% from the 2011 basketball tourney, to a still colossal 51.6 million visits, between March 11 and the April 2 title game. On a daily basis, NCAA.com and March Madness Live averaged 1.1 million daily unique visitors, which was down 10% from 2011, and averaged 473,000 daily uniques on mobile, down 1%.
- Google Ads has created a Google + page for advertising partners, where it will provide the latest Google advertising product news; training and events; tips; and Google Hangouts, with product experts. Google is promising that advertisers can “Stay ahead of the curve with the latest launches and updates for Google's advertising solutions, including search, display, mobile, social, YouTube and Google Analytics. Receive how-to information, best practices, and recommendations.” The latest how-to entry is “Fast facts about targeting ads to the modern digital mom.”
- “New dads are big-time social media newsers,” reports eMarketer. Fathers, particularly first-time fathers, engage in the same social media activities that new mothers do, according to a February survey by Edelman and The Parenting Group. The survey revealed that that 42% of new U.S. fathers who use social networks write family-related status updates on a daily basis. Further, 56% of new dads post family photos at least a few times a week, while 21% post family-related videos.
While broadcasters envision fans interacting with reality TV stars or voting for their favorite singers with apps, it turns out there’s a “higher purpose.”
Fans' primary reason for participating in social TV activity is to “keep my favorites on the air,” according to TVGuide.com user research, released in partnership with the Social TV Summit. In a survey conducted in March, 76% of respondents said keeping favorite shows from being canceled was their main motivation for social activity, up from 66% in 2011.
The definition of social activity in the survey included a broad variety of social actions, including posts, status updates, check-ins and comments on social networks, fansites, official network sites, and entertainment sites and apps such as TVGuide.com. TVGuide.com, which has more than 24 million monthly unique users, leads the mass market in mobile and social TV with over 6.5 million mobile application installations, 500,000 social Watchlists created, 7 million TV check-ins, and Social Power Rankings, a daily curated feature of user-generated activity.
Additionally, the survey found changing behavior related to when TV fans participated in social activity. Of those who participate in social TV activity, 95% said they do so after watching a show (up from 68% last year), 40% participate during a show (up from 33%), and 53% before a show (up from 52%).
Fans also experimented with a variety of different social apps, websites and experiences related to major live TV events:
- 62% had some intention to use apps/websites/experiences during the Super Bowl, while 58% actually did
- For Grammys and Oscars on average, 57% had some intention to use apps/websites/experiences, while 80% actually used them
- 33% of respondents said they participated in social activity because they wanted to say something about the event, while 69% wanted to see what others were saying
- In an apparent vote of no confidence, ABC News appears to have abandoned Tumblr, the microblogging-plus-video social media site, reports Digiday. While Tumblr has a huge audience, Digiday describes its benefit to publishers as “uncertain.” ABC had run at least three Tumblr feeds (called “Tumblrs”), including for “Nightline” and “ABC World News with Diane Sawyer” for over two years. ABC has declined comment. Digiday speculates that ABC may have been concerned about the liability of sharing content on Tumblr. ABC News has a strong presence on both Twitter and Facebook, with the Twitter accound @ABC has having more than 1.6 million followers and its Facebook page with more than 492,000 likes.
- Apple kept its word to developers. Apple on Sunday, April 1, announced to developers that it has increased their share of revenue in iAd from 60 to 70%. Also true, as AdExchanger reports the significance, advertisers can now spend as little as $100,000 to initiate mobile campaigns, down from a $300,000 threshold that went into effect last July. That is just a fraction of the “lofty” $1 million minimum for entry when iAd launched in 2010, and of the $0.5 million entry from last February.
- Google and Starbucks are planning a Google Offers campaign for this week, reports ClickZ, which “should be a boon for Google Offers subscriber numbers,” given Starbucks' popularity. Starbucks joins such national brands as REI, JetBlue, and Toys R Us which have partnered with Google Offers since Google launched the deals platform 10 months ago. Groupon still reigns as the source for bargains at local businesses.
- “The Economist” is putting the brakes on the “everything is free” ethos, reports Digiday. The magazine’s Managing Director for the Americas Paul Rossi called the free or lower-cost digital model “suicide.” Rossi spoke at Digiday’s Publishing Summit last week, and told the crowd that “It makes no sense in my mind if you think a mag on a news has a [value] to a reader of $4.99 that you sell that to a reader digitally for 99 cents or $1.99…I don’t understand the logic.” Rossi also addressed the problem of digital advertising not coming close to replacing print revenue—partly because lower- or no-cost content devalues digital ad placements.
- Business Insider has published a provocative article called “This Is What Advertisers Hate About Facebook,” citing a “top ad executive at a company that helps brands market on Facebook.” Among the dislikes: unreliable APIs. “[Google] technology has been reliable for the past 15 years. With Facebook, you feel like you're dealing with three developers in their garage changing their mind every week.” Also, ownership of data and content, particularly customer data. Facebook says it’s theirs, brands think it’s theirs. Finally, analytics. “It's not just that the functionality is lacking, the executive said, it's that the stats are virtually unusable,” says Business Insider. The executive cited disbelief that a big brand with a Facebook page for a small-town subsidiary had supposedly “reached” 1.3 million people.
- NBCUniversal has penned a multiyear agreement with FreeWheel to use its ad-management system to serve online and mobile ads across some of NBCU's network and cable digital properties, reports Multichannel News. Those properties include NBC.com, NBCSports.com, NBCOlympics.com, CNBC.com, USANetwork.com, BravoTV.com and Telemundo.com. NBCU will use FreeWheel's Monetization Rights Management system for multiple sites, including NBCOlympics.com in connection with NBC's coverage of the 2012 Summer Olympic Games in London. NBCU reports that advertisers have already bought more than $50 million in digital inventory for the Summer Olympics. With the FreeWheel system, advertisers can now buy specialized digital ad packages such as exclusivities, sponsorships and other converged-ad campaigns.
Perhaps a Facebook page qualifies as marketing versus advertising, but brand ads clearly belong front and center, and on the brand's Facebook page. Social media analytics provider Simply Measured reports considerable boosts in engagement for brands using the Facebook Timeline format, and for brands using photo and video.
Simply Measured surveyed the Facebook Fan Pages of 15 early adopters to compare engagement rates before and after implementing Timeline. It observed that brands get 46% more engagement per post when they upgrade to Facebook Timeline. Facebook promised on February 29th that Timeline would help “showcase brand’s unique stories and identities” and improve how consumers interact and engage with their favorite brands.”
Of those 15 brands, Livestrong showed the highest boost, with 161% engagement per post, followed by Toyota with 156%, Humane Society at 83% and Red Bull at 70% lift in per-post averages.
The posts tend toward fan uploads for Livestrong, but Toyota leans toward photos, videos and house ads. The Timeline redesign, says Simply Measured, “is much more visual, focused on interactive content, and provides new features that give brands more control over how their Fan Page looks and feels.” Photo and video in particular attract engagement, once again making a Timeline ripe for brand advertisements.
Comparing averages before and after, Simply Measured observed:
- 14% Increase in Fan Engagement
- 46% Increase in Content Engagement
- 65% Increase in Interactive Content Engagement (Video and Photo)
Microsoft’s Peter Yang on the company’s Microsoft Advertising blog site described numerous changes in location targeting, aimed at improving campaign performance.
“To optimize targeting in the U.S. and Canada, we will remove about 10,000 cities from adCenter targeting in May. Because these cities have seen no measurable traffic, this change will have no negative impact on the performance of your campaigns.” Users targeting a city that will be removed are advised to update settings to target a city supported by adCenter to gain more traffic. The company offers a spreadsheet of those areas (see above link), which lists 10,807 locations, plus their alternates. Someone in Flordell Hills, Missouri for example will switch to nearby Ferguson.
In answer to some FAQS about the changes:
Will this change have any negative impact on my campaign / ad group performance?
No. You are likely to see an increase in impressions if you switch your targeting to a city supported by adCenter.
Do I need to make any changes for campaigns / ad groups that are targeting multiple cities, some of which will no longer be supported by adCenter targeting?
No. adCenter will simply remove the non-supported cities from targeting options and your campaign/ad group will continue to serve ads on other targeted locations.
When will this change occur in May?
Microsoft plans to remove the non-supported cities from adCenter targeting in mid to late May.
Will this change affect other countries outside of the U.S. and Canada?
No. In May, Microsoft only plans to remove non-supported cities in the U.S. and Canada from adCenter targeting options.
- Advertisers may want to target female sports fans more often, and through social media ads, reports ClickZ. In a joint study from Visible Technologies and Applebee’s (the casual dining chain), Visible studied 125 million social media posts over a recent three-month period, to find that 31% of sports chatter on social comes from women, a result which Visible calls "surprisingly strong" compared to past findings. Carly Wilcox, director of professional services at Visible, suggested that advertisers should take note that consumers (women in particular) are incrementally shifting in terms of where they spend their time and show their interests. Whatever they are consuming, be it sports paraphernalia or beauty products, “Women are powerhouse purchasers and the sluggish movement...to capitalize on such an active group is a huge oversight in the industry," said Wilcox.
- Comedy Central has announced the launch of “Comedy Central’s Indecision’ Election Companion,” an iOS-optimized election news and political humor app. The “Election Companion” app, sponsored by AT&T, is available now as a free iTunes download for iPhones and iPads and provides users with exclusive jokes, interactive content, photo galleries and second-screen experiences. The app delivers iPad and iPhone users exclusive politics-centric content through an iOS-optimized version of the “Indecision” blog; a photo gallery called “Snap Shots,” which captures the 24-hour news cycle in images and jokes; a 2012 Election Calendar; and an app-only exclusive “Peanut Gallery” commentary feature, which provides a second-screen experience for nationally-televised political talk shows, debates and speeches. The “Peanut Gallery” also includes exclusive live commentary from Indecision bloggers and special guests, and offers real-time interactive “Reacticons” for users to register their opinions. For example, users can post “Reacticons” such as “Cry-Baby,” “Dunce,” “Yawn,” “Knock-Out” or “Bulls#*!” to express their reactions as they watch candidates and talking heads on their TV screens. The “Reacticons” will then grow and shrink to reflect the Indecision community’s collective opinion in real time.
- Google, “undaunted by a short-lived  attempt to market and sell smartphones on its own,” plans to sell its own tablets in direct competition to the Apple iPad, reports the Wall Street Journal. Google will sell the co-branded tablets directly to consumers through an Apple- and Amazon-like online store. The move, speculates the Journal, is to turn around “sluggish sales” of tablets running Google’s Android platform.
Facebook Inc. is preparing its initial public offering for May, reports the New York Post, citing “people familiar with the matter.” Facebook halted trading of its shares on the secondary market this week, as it sets about nailing down its shareholder count, say the anonymous sources. Facebook filed for an IPO in early February, and the IPO is expected to raise as much as $10 billion and value the eight-year-old company at $100 billion. Facebook netted $1 billion in 2011 on $3.71 billion in revenue, and currently has 845 million users globally.
Advertising research firm BIA/Kelsey projects that U.S. companies will spend $136.2 billion on local advertising, between traditional, online and mobile ads, in 2012, reports eMarketer. That number will climb toward $151.3 billion by the end of 2016.
As we reported yesterday, BIA/Kelsey chief economist Mark Fratrik told Media Life that digital with its lower cost-per-thousand impressions (CPMs) makes sense for smaller businesses, as well as with its more targeted reach: a print ad in a local paper, or broadcast ad on a local news station, cannot target the 12-mile radius that a plumber may wish to reach, but targeted digital ads can.
Traditional spends will grow but in the low single digits, versus in the teens for digital. Still, with its lower percentage of overall spend, the overall spends will grow annually between 1 and 4%.
Though total U.S. local ad spending should grow slowly over the next four years, digital ad spending will grow by double digits, driven largely by social, mobile and video advertising. By 2016, the firm projects that local digital ad spending will tip the scales at $38.5 billion, more than 25% of total local ad spending, up from 16% in 2012.
“From 2010 to 2011, we saw a 2.4% decline in local ad spending,” said BIA/Kelsey CEO Tom Buono at the ILM-East conference in Boston on March 26. “We were projecting a decline originally, but it’s a lot more severe than we expected because of the economy. Therefore, in our projections moving forward, we’re less bullish than we were.”