One of my startups is centered around creating group sites. Group sites can be used for many purposes such as Marketing, Support, Sales, Loyalty and Causes.
Our group sites are like ning but are more super charged for business using Online Meetings, Email Marketing, Social Analytics and other industrial strength web tools. As a test for our new platform capabilities (and also to help support the Haiti Crisis) we created a site that brings information, context, understanding and the ability to spread the word.
I encourage you to check it out and join to show your support.
Lots of continuing discussion everywhere, about Widgets. Widgets are the new cool. Everyone agrees they are a big phenomenon that’s here to stay. That said let's revisit this trend.
In their current form, widgets are the next step in the trend towards disaggregation of content at the production end and aggregation of content by the consumer. This is why they are here to stay. They will also go mobile, partly because the form factor is a fit for small screens. Most in the mobile space, from Nokia (Widsets) to Opera (Opera Widgets) are exploring the concept. There is even a W3C TR for Widgets 1.0. Widgetbox’s directory has about 7,000 widgets. And, yes, there is volume. RockYou is pushing 100M/day.
So, in all of this, where is the money?
Let’s first consider some of the models for monetizing widgets:
Several widgets can be packaged with an ad unit next to them.
Widgets can embed advertising in their content.
They can show promotional campaigns, competitions or other pay-for-placement content.
Widgets can tie into affiliate networks, e.g., buy this product on Amazon.
To analyze how monetization might work we have to look at the content value chain. There are widget builders. There are the page owners (think bloggers and folks who own a profile on a soc networking site). There are the publishers (site owners). There may or may not be a widget distribution/syndication network in the middle.
Widgets are content and widgets builders can extract value based on whether that content is unique, valuable and relevant. Nothing new here but the form factor. Content owners can let widgets spread in order to drive traffic back to their sites or they can decide to monetize valuable content. What’s new with widgets is the need/opportunity to syndicate at the level of the Net as opposed to through a small set of pre-negotiated relationships. This poses some distribution and measurement challenges.
For most page owners, widgets are bling. Direct monetization doesn’t make sense. The average casual blogger gets 150-250 hits/month. The average “pro” blogger gets 800-1000 hits/month. The average social network profile gets less than 100 hits/month. There is no meaningful eCPM that makes direct monetization relevant for the average page owner.
The opportunity for widget distribution / syndication / management platforms is to help address the above mentioned problems that arise when you try to match X widget builders with Y site owners and their Z millions of users, namely:
Discovery of widgets (content) that is relevant for people with specific interests. This is not trivial as it involves not just search but also recommendation. How else can you help widget developers “move” new widgets onto pages? As the number of widgets on the Net grows, the value of these services will increase.
Easy distribution of the widgets, from putting them on pages to enabling actions (say, working around MySpace’s Flash linking restrictions) to making sure that content is served fast. As widgets become commonplace and some standards (formal or de facto) emerge, the value-add here will decrease.
Measurement, measurement, measurement. And analytics, which are not easy to do in a broad syndication environment. There is a lot of value in this for two reasons. First, from the standpoint of traffic rating agencies, widgets count as page views. That won’t last. Eventually, someone will realize that serving 4 square inches of content is not the same as serving 100 square inches. Second, widgets will penetrate real estate that’s not monetizable. For example, I don’t want to make money from my blog but I may put some widgets on it. From a behavioral targeting standpoint, widget distribution networks may get better data than even some of the very large ad networks.
Monetization enablement + audit. No rocket science here but someone needs to make money move through the content value chain.
Widget marketing services, from SEO to SEM to viral distribution enablement. A widget syndication network may have the best data to optimize these. Some type of fee or pay-for-placement structure has to be put in place amongst widget developers to address prioritization conflicts.
From the markers perspective, I have spoken with several of my clients who are very marketing savvy and they continue to be skeptical about any significant marketing spending in this space. There is a measurement, ROI, and accountability issue that still remains to be solved. There is a vibrant spirit to tinker and experiment to see what works.
The blogosphere is loaded up with all flavors of Facebook Advertising analysis, and much handwringing over the notion of users expressing their enthusiasm for Diet Coke or “American Gangster” on their Facebook page and Coca-Cola or Universal Pictures placing ads in the newsfeed as the items are spooled to their social graph. (Beyond Facebook, it’s not hard to imagine a contextual ad showing up every time you Twitter something. Twitter “I am drinking beer with friends” and a Budweiser ad shows up. Now imagine the Twitter revolt.)
Cutting through the hype, Facebook Ads (description here) are the latest twist on viral marketing, taking advantage of the social graph, creating what Nick Carr cleverly calls “social graft.”
Nick wrote: Marketing is conversational, says Zuckerberg, and advertising is social. There is no intimacy that is not a branding opportunity, no friendship that can’t be monetized, no kiss that doesn’t carry an exchange of value. The cluetrain has reached its last stop, its terminus, the end of the line. From the Facebook press release: “Facebook’s ad system serves Social Ads that combine social actions from your friends – such as a purchase of a product or review of a restaurant – with an advertiser’s message.” The social graph, it turns out, is a platform for social graft.
We’ll find out soon whether Facebookers will embrace the concept, accepting the blurring of their content and ad content and helping to fulfill Facebook’s business goals.
Brands will try to become intimate with Facebookers, enticing them to associate themselves with a product or service. If you love your Prius, become Toyota’s friend…and you’ll be able to stay up-to-date on the latest Prius news and games, meet other Prius fans, make ads for Toyota and maybe even get a free tuneup. I prefer just to drive my Prius.
Facebook founder Mark Zuckerberg is right. “Nothing influences a person more than the recommendation of a trusted friend,” he said during the rollout of social ads yesterday. But giving brands/advertisers somewhat equal (Facebook members have some controls) access to the social graph could be viewed as an intrusion into the relationships people establish with each other. On the other hand, Facebookers may just view it as another application on the service.
When I buy a movie ticket via Fandango, the transaction can be turned into a newsfeed item spooled to my social graph. Can I get a discount on the Fandango fee for messaging my social graph about my Fandango ticket? Maybe users get a cut of the action, for colluding with advertisers? But then, they might start gaming the system to increase their bounty.
Facebook Ads is a logical next step, but also an experiment. Google has mastered the art of monetizing search to market cap of $231 billion. MySpace is innovating with its HyperTargeting. With the taint of social graft, Facebook has come up with a way to monetize people in the form of its rapidly growing membership, profile data and social graph. Perhaps it will grow into its $15 billion valuation.
Now we can sit back or lean forward to see how Facebook responds to OpenSocial and how Google responds to Facebook’s people-based targeted advertising.
Ayres does convincing job of making you feel like this should be the only alternative to decision making. In fact, he was thinking of calling this book, the end of intuition. He provides great examples of how quantitative investing does a better job of diagnosis than most physicians. Equations do better than many experts. Randomized trials are an excellent way of providing insight on alternative theories.
Still, in the investment area, there may be room for intuition. The room for error with investment decisions is large. Many regression equations trying to provide explanation of returns find that they can explain less that 15% of the total variation in returns. The results of many regressions are a function of underlying assumptions. The variables in many regressions are unstable. Intuition is needed to provide the right quantitative framework and power to know when to change models. My conclusion is that super crunchers need intuition in order to properly set the problem and interpret the results. There is still no substitution for experience in interpreting what models are telling the analyst. There no chance for randomized trials in the normal sense with investing. Quantitative investing without intuition is as dangerous as using the seat of your pants.
What are your thoughts about the balance between the that it could change the way you think. I should like this book as someone who has been a champion for quantitative analysis my entire career. I have always felt comfortable with the discipline of systematic investing, yet my feelings were mixed at the end. There is the conclusion that looking at the numbers will provide better insight. Looking for long-term relationships will be able to eliminate the problems of emotions with investing. There will be less risk of being swayed by emotions or the whims of crowds.expert-intuition that comes from experience and the power of statistical models and data-driven insights?
