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Performance advertising success stories in social media April 24, 2009

Posted by jeremyliew in advertising, facebook, performance, social media, social networks.
9 comments

On Wednesday I moderated a panel at ad:space (an ad:tech satellite conference centered on performance advertising) focused on how performance advertisers can be successful in social networks. The discussion from panelists Ro Choy (Chief Revenue Officer at Rock You, a Lightspeed portfolio company), Seth Goldstein (CEO of Social Media) and Tim Kendall (Director of Monetization at Facebook) was very enlightening.

Comscore recently noted that performance advertising adopts online media faster than brand advertising because it is easier to measure results over short time periods. The knock on social media ad inventory has been that CTRs are low. This is less relevant for performance advertisers who only pay on the click or the action anyway. We heard about some terrific success stories for performance advertisers in social media on the panel who are seeing ROI on their ad spend comparable to Google.

The panelists called out two particular examples of advertisers seeing real scale results. Seth highlighted mobile services as a category that has seen terrific success in customer acquisition in social networks (if you’ve seen the “crush” or “IQ test” ads on Facebook or Myspace you’ll know what he is referring to) and is generating hundred of millions in incremental revenue from this channel. Ro mentioned that Rockyou generated 1.5m new users for an online game advertiser in just one month. Although not represented on the panel, MySpace is selling hundred of millions of dollars worth of performance advertising per year. These are impressive numbers.

The panelists highlighted one key difference between social media performance advertising and Google AdSense style performance advertising. AdSense uses contextual targeting to improve performance. Social media uses demographic, behavioral and social targeting to improve performance.

In the open web much demographic targeting is inferred from behavior. For example a user who visits ESPN.com, Nascar.com and NFL.com might be inferred to be male. This is often, but not always, correct. Social networks take a different approach. On their profile pages, users declare many key aspects of their demographics, including age, gender and location, the three key elements for targeting. Targeting based on these self declared demographic elements can be very effective for performance advertisers within social media. Ro related the example of Rachel’s yoghurt, an advertiser that targeted coupons to women living within 5 miles of Whole Foods in 10 cities through Rock You. The campaign delivered 0.20% CTRs to the Rachel’s Yoghurt site, with a 35% coupon download rate. These are impressive numbers, and led the advertiser to renew the campaign for an additional 12 weeks. Doing such a high level of targeting can result in relatively small numbers of impressions, but this is one area in which social media excels. Because of the high reach and high number of pageviews, social media sites can still deliver sizable campaigns to even highly targeted campaigns.

Behavioral targeting also benefits from the scale of social networks as even tightly targeted campaigns can still deliver meaningful reach. Retargeting works well, as it does for the open web, but once again this can be combined with declared interests on user profile pages. Tim described a very detailed campaign that a politician, Patrick Mara, ran on Facebook to defeat a 16-year incumbent in a DC city council primary last year. Mara was in favor of allowing gay marriage, so he pushed information about his stance out to DC Facebook users who’d listed their sexual orientation as gay. If Facebookers had kids, he targeted them with ads about the school system, and if they were Republicans, he hit them with information about taxes, school vouchers and similar conservative favorites. Very clever! And apparently quite cheap for the results — Patrick found Facebook advertising to be a great way to recruit volunteers. Future local campaigns, take notice.

Social targeting is one area that is unique to social networks. Integrating knowledge of social ties into the creative of the ad can really lift response rates. Seth described one campaign that Social Media ran for Live Nation, the concert promoter. Seth himself saw an ad with the name and picture of a friend of his saying “Dan is going to see Cold Play at Shoreline this summer. Do you want to go with him?”. This is a great example of an ad that takes advantage of knowledge of behavior (Dan is going to see Coldplay), location (the concert is near where Seth is) and friendship ties (Dan is a friend of Seths) to build a very compelling piece of creative.

The theme of customizing ad creative for social media came up repeatedly during the panel. While good results could come from running standard web creative and using the targeting that social media provides, the best results came from building campaigns that appeal to behaviors that are native to social networks. Often this had to do with identifying friends (names and pictures) in the creative, as well as integrating a compelling social call to action. Ro described a campaign that Rockyou ran for Pentel Pens that asked users to enter “their smoothest (pickup) line” into a sweepstake. The rich media with video campaign led to real engagement with a 22.5% engagement rate (2x av performance for the category), a 0.6% CTR and 60% of users watching at least half of the video. The campaign drive over a million entries into the contest and worked well to drive high engagement with an “unsexy” CPG brand because it was well crafted for a social environment.

It is clear that social networks provide a real opportunity for performance advertisers. Smart targeting allows the first level of performance lift, and custom campaigns and creative that are “native” to social media can deliver even further lift. I think we’ll see much more adoption of this channel by performance advertisers over the coming months

Best practices in contextual and performance advertising in social networks. April 15, 2009

Posted by jeremyliew in advertising, performance, social media, social networks.
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I’m moderating a panel at AdSpace 2009 next Wednesday. The conference is focused on contextual advertising and is in partnership with ad:tech at Mosconne in San Francisco.

My panel is at 5pm on social media strategies for contextual and performance advertisers;

Social Media Strategies
Social media sites are garnering billions of page views a month, yet many advertisers have yet to dip their toes into social media advertising. Find out how advertising on social media sites differs from contextual advertising and whether social media advertising will drive ROI for your business.

MODERATOR:
Jeremy Liew, Managing Director, US, Lightspeed VP

PANELISTS:
Ro Choy, Chief Revenue Officer, RockYou

Seth Goldstein, CEO, SocialMedia

Tim Kendall, Director of Monetization, Facebook

If you’d like to come, use the code 25ADSPACE to get a 25% discount at registration.

Myspace suspending some categories of performance advertising? March 29, 2009

Posted by jeremyliew in advertising, myspace, performance.
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PlentyOfFish claims that MySpace is suspending all dating and diet campaigns:

Apparently they got an email saying:

I have a bit of news about your campaign. Rupert Murdoch has decided to put all dating & dieting campaigns on MySpace on hold for a few days. They are discussing about dating creatives currently and planning to come up with a set of standards for them. I wanted to notify you and let you know that the campaign will be halted today and I will keep you updated as soon as I hear some news. I apologize for the inconvenience

Dating, Diet and Mobile comprise the three biggest categories of performance based advertising on social networks, so two of the big three are affected. If this suspension continues it will likely have a measurable impact on MySpace’s revenues.

Three ways that social networks are different from other forms of online communication February 4, 2008

Posted by jeremyliew in communication, email, performance, social games, social media, social networks.
9 comments

Social Networks are widely accepted to be the latest evolution of online communications, tracing a line back through instant messaging, webmail, chat rooms and bulletin boards. Now that we’ve had a little more time and perspective on how they are used, we’re starting to see a few differences between how social networks are used for online communication and previous forms of online communication. I can think of three primary differences:

Stages for Performance.

As danah boyd has noted before, the public nature of many social network communications leads to performance aspects to communication. Users are simultaneously communicating with not just the recipient, but anyone else who happens to stumble across the recipient’s profile. An example I gave in a previous post is a helpful illustration:

Suppose it’s your birthday, and I know it. If I send you an email wishing you “Happy Birthday” then you’re happy that I remembered. This communication is part of the social lubricant on which relationships are built.

But supposed that I post “Happy Birthday” to your Facebook Wall instead. Then not only do you know that I remembered, but ALL OF YOUR FRIENDS know that I remembered as well. They may find out from the feed, or by visiting your page, but they will know that I’m a good enough friend of yours that I know when is your birthday. That is the performance element of the communication.

Lighter Weight Communications

Historically, an important part of communicating with someone is having something to say. Emails are not sent blank, calls are not spent silently. But as the quantity of one’s relationships increases over Dunbar’s number, it becomes impossible to maintain the full overhead of communication with each person. Put simply, for some of your weaker ties, you just don’t have the time to think of something original to say to each one of them. But you still want to maintain some “heartbeat” to the relationship with an occasional ping.

People have found lots of solutions to this problem. One is the Holiday card, often with an annual update letter enclosed. Another is the non verbal communication often seen between coworkers in an office or competitors at a conference. Smiles, nods, back slaps, high fives as you pass each other in the corridor are enough to keep a relationship acknowledged without having to stop and talk each time. A third is the chain email. Whether forwarding inspirational passages, funny videos or jokes, chain emails let people keep in touch with their friends without having to spend a lot of time thinking about what to say.

These lightweight communications are native to social networks. Whether they be exchanging pokes on Facebook or pasting a glittering “thanks for the add” .jpg into a Myspace comment, “content free” communications abound. The meta message is clear though “I’m thinking of you”, and that is often enough of a ping to keep the connection open. Many of the Facebook and Bebo apps fulfill exactly this lightweight communication function, including Hug Me, Zombies and Scrabulous. Many of the social games on facebook wrap this lightweight communication around a casual game.

Context for communications

Facebook’s innovation in the feed is now being widely imitated by the other social networks, and with good reason. As I mentioned earlier, two of the challenges of having a large number of relationships are (i) keeping on top of them all and (ii) being able to communicate often enough to keep the relationships alive. The Feed dramatically simplifies this process, especially when combined with Facebook’s birthday notification and the full status updates list. All three features provide triggers for communications with friends, whether commenting on their pictures, posting witty comments to their wall about what they are doing or wishing them a happy birthday. Facebook and other social networks are helping prompt more communications between their users by helping to surface topics for communication.

Yahoo, Google, AOL and Microsoft are all rumored to be revamping their communications products; it will be interesting to see if how they start to incorporate some of these social network native features into their email and messaging products.

The top movies, books, TV shows, music, heroes and general interests on Myspace are… December 10, 2007

Posted by jeremyliew in myspace, performance, social media, social networks, taste.
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Last month dana boyd and Nicole Ellison were guest editors for the Journal of Computer-Mediated Communication in a special theme issue on social network sites. One of my favorite papers was by Hugo Liu at the MIT Media Lab who investigated how social network profiles act as taste performances.

Liu surveyed over 100,000 random myspace profiles, paying particular attention to the stated lists of interest (music, books, movies, TV shows, heroes and general interests). And the winners are…

Favorite Book: The Da Vinci Code
Favorite Music: Radiohead
Favorite Movie: Fight Club
Favorite TV Show: Family Guy
Favorite Hero: Mom
Favorite Other Interest: Music

See the whole list below, by category (click to read):

Myspace most common interests

Aside from idle curiosity, Liu notes that these interests also constitute “taste statements” for the profile owners:

The materials of social identity have changed. Up through the 19th century in European society, identity was largely determined by a handful of circumstances such as profession, social class, and church membership. With the rise of consumer culture in the late 20th century, possessions and consumptive choices were also brought into the fold of identity. One is what one eats; or rather, one is what one consumes—books, music, movies, and a plenitude of other cultural materials.

New emphasis on taste and cultural consumption frees identity from some of its traditional socioeconomic limitations. The milieu of cultural interests one creates for oneself can even be transformational, because cultural consumption not only “echoes” but also actively “reinforces” who one can be. In the pseudonymous and text-heavy online world, there is even greater room for identity experimentation, as one does not fully exist online until one writes oneself into being through “textual performances”.

One of the newest stages for online textual performance of self is the Social Network Profile (SNP). The virtual materials of this performance are cultural signs—a user’s self-described favorite books, music, movies, television interests, and so forth—composed together into a taste statement that is “performed” through the profile. By utilizing the medium of social network sites for taste performance, users can display their status and distinction to an audience comprised of friends, co-workers, potential love interests, and the Web public. Although social network sites are relatively new, SNP taste performance can be seen as an instance of what sociologist Erving Goffman termed everyday performance. Successful performers are “aware of the impression they foster.” Thus, taste statements need to be crafted so as to stand up to the scrutiny of an audience that is able to “glean unofficially by close observation”.

Essentially, on a social network profile, saying what you like defines who you are, not just to yourself, but to others. Liu’s primary findings were that:

    1. Taste is not random, but rather is guided by aesthetic preferences across interpretable axes. For example, the two dimensions: (i)utopian-vs-dystopian and (ii)sincere-vs-satirical, explain over one quarter of all the variation of taste in books. The two dimensions; (i) sexy-vs.-funny and episodic-vs.-saga structure, explain over one quarter of all the variation of taste in TV. If these axes are indeed opposable, it raises the question; is it possible to be both sexy AND humorous in MySpace?

    2. Many MySpace users craft their interest list with a view towards “looking good” to a particular audience (Liu calls this “prestige”). He found that “coherence” among stated interests was much higher for both those with extremely popular interests, and those with extremely rare interests, than for average users. This suggests that people in both cases are deliberately constructing a clear message that they belonged to either the popular culture, or a particular sub-culture, and self censored other interests that might obscure their message.

    3. Some MySpace users craft their interest list to differentiate themselves from their peers. Users’ interests tended to be more dissimilar from their “Top 8” friends’ interests than would be expected to happen by chance. While it is possible that users tend to friend those who complementary tastes, it is more likely that they craft their profiles with an awareness of their firends’ profiles so as to be unique.

    4. Musical interests play a dominant role in taste and identity. There was far more variability in music interests than in the other categories. Indeed, it seems as though specificity in music interest is far more valued than genre or any other factor.

While these conclusions may not be surprising, it is helpful to have empirical evidence, rather than simply asserting them to be true, which the typical blogger pundit is wont to do.

Three ways that a conference lobby is like Facebook October 21, 2007

Posted by jeremyliew in communication, Consumer internet, performance, social networks, web 2.0.
6 comments

I spent three days last week at the Web 2.0 Summit, mostly in the lobby of the Palace hotel. The lobby served as the crossroads for the conference; all attendees passed through there and many never seemed to leave it! It was a great venue to catch up with friends and industry contacts among the attendees and lobbyconners.

It struck me that the conference lobby was like a social network in three ways:

Public Communication as Performance

At Web 2.0, if you wanted to have a private conversation, you would leave the lobby and find some place more private. In a social network, if you wanted to have a private conversation you would send a private message. But if you were OK with others seeing your conversation, you would stay in the lobby, or post a public message on the Wall/Comments. The Performance aspect of communication is seen both online and offline.

Serendipitous communication

In ordinary life, you communicate with far fewer people than you’d like to. You forget, you get busy, and you don’t reach out to people that you’d like to talk to more often. But in the lobby of a conference, you’re always accidentally running into people that you’d love to talk to but don’t usually see. This is one of the biggest benefits of conferences.

Similarly, social networks bring up opportunities to communicate with people that you may not have connected with in a while. Perhaps you see one of their comments posted on a friend’s MySpace page, or you get an update on them from the Facebook feed, and are prompted to ping them. I’ve been communicating more regularly with ex colleagues and extended family because of Facebook.

Lightweight Interactions

Over the course of two days at a conference you’ll see the same people a number of times. After you’ve talked, there is only so much you can say the next time, so your interactions tend to get lighter weight. You want to acknowledge each other but not necessarily get involved in a long conversation. So you smile, shake hands, clap shoulders, bump fists, wink, wave, or kiss cheeks (gender specific!) instead. It is the same rationale that leads you to text a friend instead of call.

Social networks provide similar lightweight opportunities for interaction. Facebook’s poke is the simplest example. Although Kara Swisher thinks that many Facebook apps are childish, I think they are providing an avenue for lightweight interactions between friends. Whether you’re buying someone a drink, biting them to turn them into a zombie, hugging, slapping or tickling them, the subtext of “I’m thinking of you” is there.

Conclusion

People building social media companies and other companies that require user interaction should bear these examples in mind. It is hard to create new mental models of behavior for users. As always, if there is an offline parallel for the online behavior you want from your users, you’re more likely to succeed. These three elements of social network behavior have clear offline parallels.

More on Facebook as a stage for performance October 6, 2007

Posted by jeremyliew in facebook, performance, social media, social networks.
1 comment so far

From today’s NY Times, a core Facebook (college aged) user notes:

Facebook did not become popular because it was a functional tool — after all, most college students live in close quarters with the majority of their Facebook friends and have no need for social networking. Instead, we log into the Web site because it’s entertaining to watch a constantly evolving narrative starring the other people in the library.

I’ve always thought of Facebook as online community theater. In costumes we customize in a backstage makeup room — the Edit Profile page, where we can add a few Favorite Books or touch up our About Me section — we deliver our lines on the very public stage of friends’ walls or photo albums. And because every time we join a network, post a link or make another friend it’s immediately made visible to others via the News Feed, every Facebook act is a soliloquy to our anonymous audience….

My generation has long been bizarrely comfortable with being looked at, and as performers on the Facebook stage, we upload pictures of ourselves cooking dinner for our parents or doing keg stands at last night’s party; we are reckless with our personal information.

As I’ve noted before, this is why facebook apps with a performance component are doing well.

Hat tip to Publishing 2.0 for the pointer to the NY Times article.

Communication, performance and birthdays September 23, 2007

Posted by jeremyliew in communication, email, performance, social media, social networks.
4 comments

It was my birthday on Friday ,and it was the first birthday I’ve celebrated as an active member of a social network.

I’ve posted in the past about the performance aspects of social network communication, and how this affects future email use. I’ve also posted about social design for social media companies, and how Facebook’s birthday reminder and wall work together to uphold the first two of the rules of social design:

Motorola Findings

It was interesting to see this all play out as a participant. For my birthday, I received in total:

  • 1 “happy birthday” phone call
  • 2 “happy birthday” cards
  • 20 “happy birthday” email
  • 3 “happy birthday” private messages on social networks
  • 26 “happy birthday” public messages (ie posted on profile) on social networks
  • Fully half of the messages were public. But within the context of the social network, almost 90% of the communications were public.

    Communications modes seem to be shifting very quickly, at least for those messages with a “performance” aspect.

    I’d be interested to hear similar stats from readers.

    Facebook apps are providing new stages for “performance” by users July 17, 2007

    Posted by jeremyliew in communication, Consumer internet, facebook, Internet, performance, self espression, social media, social networks, user generated content, web 2.0, widgets.
    10 comments

    Its now widely agreed that the two most common behaviors on social networks are self expression and communication.

    Most of the online revolutions have been driven by new forms of communication. This started with Usenet and BBSs back before there was an internet, moved through the chat rooms of early AOL, the mainstreaming of email and the instant messaging revolution with AIM and ICQ. Communication has always been a large portion of overall time spent online because it drives both frequency of visit (people check for communications often) and depth of visit (reading and responding to your messages takes time).

    Social networking is no exception, and that is what has driven the extraordinary pagesviews for the top social networks. In the case of social networks, the primary communications channels are private messages and public comments. You can see how these relate to other older forms of online communication below:

    communications-matrix.png

    Social network private messages look a lot like webmail. Public comments on social networks are newer and more interesting. Indeed, Danah Boyd includes public comments as one of the three defining features of social networks (along with Profiles and Friends lists). Unlike message boards, public comments “belong” to a single person and are addressed directly at them. But as Danah has also pointed out (I wish I was half as smart as her!), there is also a performance component to public comments on social networks.

    This is best understood with an example. Suppose it’s your birthday, and I know it. If I send you an email wishing you “Happy Birthday” then you’re happy that I remembered. This communication is part of the social lubricant on which relationships are built.

    But supposed that I post “Happy Birthday” to your Facebook Wall instead. Then not only do you know that I remembered, but ALL OF YOUR FRIENDS know that I remembered as well. They may find out from the feed, or by visiting your page, but they will know that I’m a good enough friend of yours that I know when is your birthday. That is the performance element of the communication.

    Indeed, Danah says that your Friends list is your best guess at the audience for whom you are performing:

    The collection of ‘Friends’ is not simply a list of close ties (or what we would normally call ‘friends’). Instead, this feature allows participants to articulate their imagined audience – or who they see as being a part of their world within the site. While SNSes have millions of users, most participants only care about a handful of them. Who they care about is typically represented by the list of Friends. If an individual imagines her profile to be primarily of concern to a handful of close friends, she is quite likely to have very few ‘Friends’ and, if the technology allows it, she’ll keep her profile private. If she wants to be speaking to her broader peers, her Friends list is likely to have hundreds or thousands of Friends who are roughly the same age, have the same style, listen to the same music, and are otherwise quite similar to her. She is also quite likely to keep her profile publically [sic] visible to anyone so that she can find others in her peer group (boyd 2006).

    Historically, the Wall (Facebook)/Friend’s Comments (Myspace, Bebo and others) has been the only place on a profile where another user can put something on your page. The rest of the profile has been completely under the author’s control.

    However, some of the Facebook apps have changed this paradigm. A number of the most popular apps allow another user to put something on your profile, including #2 Graffiti, #7 X me, #8 Superpoke, #9 Free Gifts, #15 Superwall, #16 Foodfight and lots more. [Note: X me and Superwall are both owned by Rockyou, a Lightspeed company].

    In my own experience, performance is an aspect to the use of these apps as well. I feel a certain pressure to choose something “clever” to X someone (e.g. “defenestrate”, “disdain” or “milk”), and if I’m leaving graffiti on a friends page, I try to make it good. The popularity of these apps suggests that social network users are craving more stages for their performances.

    I’d be interested to hear what readers think.

    Reminder: please switch your RSS feed to feeds.feedburner.com/lightspeedblog – it helps me keep track of RSS readership. Thanks a lot!