The Steve Rubel Stream

23 Jun 2010

Essay: The Apple Threat to Online Advertising

The following essay is also my column this month on Forbes.com.

Caption: Safari's new Reader view could rob publishers of page views especially if it finds its way into iOS devices

Watch Out: Apple May Aim To Reshape Online Advertising

Apple, without a doubt, is creating a massive sea change in how we interact with digital content. Note that I didn’t say “the Web.” This is because the millions of iPad and iPhone users spend more time within Apple’s walled garden of apps rather than in a browser. However, there’s a potential dark side to the millions of Apple devices being sold and it should give every marketer pause.

If you look just below the surface of all the hype around the iOS devices (the iPads, iPod Touches and iPhones), there’s a dirty little secret. Apple might be positioning the platform as a Trojan Horse that reshapes digital advertising as one man—Apple CEO Steve Jobs—thinks it should work. While this messianic zeal benefits users, it could conceivably create a competitive moat for Apple and its partners.

Jobs has more than a passing interest in online advertising. He co-authored a patent filing in 2008 called “Advertisements in Operating System.” Now Apple has put into place systems that handicap existing dominant formats like rich-media ads and interstitials.

Case in point: Safari. On June 7, the day Apple unveiled the new iPhone, it also shipped Safari 5. The browser, available for both PCs and Macs, has a feature called Reader that neutralizes multipage articles and interstitial ads by giving the user the option to read an article in a new clean view that strips away all but the text of the article.

A primary benefit of the new Reader view is that it allows a user to consume a multipage story without having to endure multiple clicks, interstitials and a new set of banner ads. This sounds great but it may rob publishers of ad impressions.

Now, granted, no one is saying that Safari is a powerhouse. It has a minuscule 10% share, according to Net Applications. However, keep in mind this feature is found only in the desktop version of Safari today. There’s no reason why Apple wouldn’t bring Reader to the growing armada of iOS devices—which commands an 60% share of all mobile browsing, according to Quantcast. The end result may be that more publishers will flock to the App Store and iAds.

Equally troubling is Apple’s posture toward rich-media ads. In the April open letter “Thoughts on Flash” Apple and Jobs clearly outlined why they are not allowing Adobe to push forward with its plans to bring the technology to the iOS ecosystem.

Most of Jobs’ arguments were primarily based on technology issues and user experience. Ads were only mentioned briefly. However, if you read between the lines, there may be another motive. Apple could be trying to pave the road for the success of iAds. (Disclosure: Edelman, my employer, is Adobe’s PR agency.)

The takeaway here is that as iOS devices grow in popularity, the platform encourages advertisers to increase their iAd budget and/or develop their own apps. This benefits developers and iAds advertisers. Now, I’m no lawyer, but it’s conceivable that if the iOS platform one day achieves any kind of dominant position the way Windows has, this may be viewed as an anti-competitive move.

No single company will ever control the Web. However, as Apple’s power grows and it begins to push into advertising with new formats, it must not put up roadblocks to other formats as it has done in the case of Flash or could do with its Reader view. Pressure from CMOs and others in the industry like the Association of National Advertisers and the IAB will ensure that even as Apple devices gain share advertisers will have the same freedom of choice in how they advertise in the post-PC age that they did in the previous era.

17 Jun 2010

Putting $10,000 in Newspaper Ads Over Social Media

Paul Williams writes that given a choice he would rather plow $10,000 into newspaper ads over social media...

"Social media is a great way to keep the conversation going with your customers outside of your store. A way to listen. A way to learn.
Social media is our gold rush. With the zillions of tweets, Diggs, blog posts, and Facebook updates all panning for attention I’ve only heard of a few who have ’struck it rich’ as a result.

With $10,000 to spend. I’m going to put it into a well designed ad, in a print medium, my target audience reads".

If we're talking ads to ads I can see where he's coming from. Although, $10,000 in Google ads could be a better initial investment than both combined.

However, then fact remains that advertising is untrusted and it's thought leadership and expertise that rises to the top in today's world. People want to know what you stand for before they develop an ongoing relationship. #

10 May 2010

Video: Bill Gross, CEO, TweetUp, Idealab

Last week in LA I had a chance to visit Idealab, an incubator that pioneered pay-per-click advertising a decade ago. The purpose of my visit was to meet CEO Bill Gross and his team and to learn more about TweetUp, an innovative new service that, I believe, has a great shot of creating a demand-driven ad network around Twitter.

(Idealab, not TweetUp specifically, is an Edelman client.)

Unlike Twitter's own ad platform, TweetUp will surface not only tweets but tweeters. What's more, they will be integrated as widgets/columns in key ecosystem apps like TweetDeck and contextually via large sites like Business Insider.

To me, TweetUp's greatest appeal lies in that it's a mix of paid, earned and social. In order to receive the best position for your tweets, the TweetUp system needs to perceive that you are an expert in the topic/keywords you are bidding for.

For more, see the above short video I shot with Bill Gross, their CEO.

13 Apr 2010

Twitter Sponsored Tweets: The Impact for Marketers

Big day in Twitterland with the roll-out of their new ad platform. This morning I gave an interview to my friends at Forbes.com, where I am a columnist, on my thoughts and hopes for the platform. The full interview follows below...

Forbes: What's most surprising about Twitter's Ad platform?

Steve Rubel: What's most surprising about the rollout is how conservative it is. It's clear that Twitter thought a lot about all three of its primary audiences - users, developers and advertisers - and devised a system that seems to respect the needs of all three. They could have been a lot more aggressive by focusing only on display or rich media but they chose a more measured, contextual approach, which I think will help them in the long run.

Forbes: What do you see as the most significant component?

The most significant component is resonance--the nine factors that Twitter will use to measure the performance of the ads. If an ad isn't performing well across all of these key performance indicators, then the ads will be taken out of rotation. It's very similar to Google's model, which has helped the ads maintain a high degree of relevance.

Forbes: What about it will be most useful to marketers?

The most intriguing aspect of the platform is that it allows businesses to add a degree of permanence to their tweets. This means that they can maintain some degree of visibility, long after they have floated downstream.

The reason this is significant is that the "destination Web era" (where we browse from site to site) is over. Today, more of us are consuming content in stream form. If you're not in the stream when a tweet hits, you're likely to miss it. With this new program, advertisers can now pay to get around this - which is significant - and target their tweets accordingly.

Working for a public relations firm, I am particularly intrigued by how Twitter is positioning it as a reputation management service for companies in crisis.

Forbes: What could Twitter have done better with its ad platform plans?

It's a bit early to tell, but so far nothing. It might have been better if they opened up the process a bit to developers and power users to weigh in, but I am not seeing any kind of backlash so far. I believe that Twitter's audience wants to see them monetize in a way that allows them to maintain and grow the platform they love. The trick is to do so in a way where the advertising adds value to the experience and doesn't get in the way. This seems to hit this nail on the head, but time will be the ultimate jury.

Forbes: What will happen to the other paid Tweet platforms?

Twitter is at a crossroads right now. It is starting to add some of the features that have allowed some vendors in its ecosystem that filled voids to thrive. The trick for these platforms will be to stay ahead of the game. Ideally Twitter will open a dialogue with them to give them a sense of the markets they plan to enter and those they plan to avoid so that the ecosystem can build viable business models without having to worry about them being disrupted by the mother ship.

Forbes: Is there anything about this ad platform that is disruptive either to other social ad platforms or to the way that marketers interact with social consumers?

It's a bit early to tell how disruptive this will be. It all depends on how well the ads are received by the community and how well they perform. It could potentially create a nice direct response platform that complements other, brand-oriented models like those that have made ads on Facebook and YouTube successful.

1 Mar 2010

Ads Drop Dot-Com URLs in Favor of "Facebook Us"

The following is also my March Forbes.com column.

Today it seems that many marketers are literally tripping over themselves to invade social networks in force. There's almost a land grab underway as businesses rush to set up hubs on the "big three": Facebook, Twitter and YouTube. You can definitely sense that we've passed a tipping point.

All at once, businesses large and small are increasingly recognizing that they need to go where the people are. And with 100 million Facebook users in the US who spend an average seven hours on the site each month (Nielsen), it's surely a no-brainer. When your local pizzeria is promoting their Facebook page at the register, as mine does, then you know that marketing has changed. The same applies to Twitter and YouTube.

However, with this land grab, a controversial shift is underway. The trusty dot-com URL, at least its role in marketing, maybe dying.

Some companies are de-emphasizing spaces they own, like their web site, in all of their ads. Instead, they're pushing people towards spaces they rent where people are spending time - e.g. their Twitter, YouTube Facebook hubs.

Case in point: UniBall. During the Winter Olympic games I was surprised to see the pen manufacturer use its TV ads to point people to its Facebook page. There UniBall is giving away 10,000 pens. Nowhere in its ads does Uniball promote its own web site. It's all about Facebook. Clever.

Much the same, I noticed the New York Knicks basketball team in its outdoor ads had only three calls for action - an SMS code, Twitter and Facebook. Again no URL. A dot-com was nowhere to be found.

Finally, during a recent Mashable event in New York, Columbia Journalism professor Sree Sreenivasan pointed out that this is becoming the norm in the motion picture business. Perhaps this is a function of living in a world where people hardly use bookmarks any more and just Google.

If this all sounds familiar, it should. It's all reminiscent of the mid-1990s when URLs started popping up in TV ads and billboards. Or worse, when AOL keywords first surfaced in the early 1990s. These were curious at first, then later, welcome. Now I guess a URL is just boring.

However, this time it's different.

For starters, when marketers promote their social network hubs over their URLs they risk that more savvy consumers will see right through it. People could perceive it as a flat attempt to look cool and hip. Consumers already skeptical of advertising and this just adds to it.

Second, the use of "heavy artillery" - e.g. advertising - to round up more fans and followers is equally controversial. This would be fine if it lead to true person-to-person engagement. However, many brands are just using their Twitter and Facebook presences to spew out updates, without any thought to how consumers will benefit by essentially opting in. UniBall is providing value but others don't go to such lengths.

Finally, much the same, very few businesses treat social networks as personal, conversational spaces. Hardly any feature real employees. And a scant few aim to advance shared interests.

So while it's welcome that marketers are beginning to promote the hubs they rent in all of the relevant communities, few are really optimizing them into true relationship builders. Most are devoid of humans - e.g. employees - and many look like faceless companies that are trying to check off boxes or slap shiny logos on their site.

In some ways, it makes sense to me that marketers are emphasizing their spaces where people are spending time and where they can be easily found. However, at the same time, with so few understanding what it takes - people - to really build credible relationships, I wonder how long this trend might last and if a backlash is the works.

If I were a dot-com URL, I wouldn't write my will just yet.

Essay: The Apple Threat to Online Advertising

Putting $10,000 in Newspaper Ads Over Social Media

Video: Bill Gross, CEO, TweetUp, Idealab

Twitter Sponsored Tweets: The Impact for Marketers

Ads Drop Dot-Com URLs in Favor of "Facebook Us"

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