Jumat, 28 Januari 2011

Marketing Pilgrim Published: “Now, Who Do We Trust?” plus 3 more

Marketing Pilgrim Published: “Now, Who Do We Trust?” plus 3 more

Link to Andy Beal's Marketing Pilgrim

Now, Who Do We Trust?

Posted: 27 Jan 2011 11:13 PM PST

It’s time for the 2011 Edelman Trust Barometer! Trust me when I say, you’re going to want to hear this.

According to the survey, there’s been a pretty big shift in whom we trust to give us credible information. In both 2009 and in the current report, academics and experts got the biggest vote of confidence with 62% and 70% respectively. But in 2009, “Person like yourself” got 47% of the vote, but in 2011 that number dropped to 43%.

Steve Rubel of Edelman Digital wrote an excellent article about the Trust Barometer survey and I like his take on this particular drop.

I believe the reason for this is that, as more of us join social networks, there’s been a devaluation in the entire concept of “friendship.” A separate survey found that people don’t know 20 percent of their Facebook friends. Consider that “unfriend” was Oxford’s word of the year for 2009.

But here’s where it gets weird. The trust metric for CEO’s jumped up from 31% in 2009 to 50% in the new survey. Seriously? Suddenly we have trust in what the CEO’s of companies are telling us? How did that happen?

Maybe this new found trust factor comes from the fact that CEO’s appear to be more transparent these days, more accessible to the general public. Not to mention the fact that half of them look like college kids who just came from a frat party (excuse me a moment while I adjust my bifocals and shawl.)

Another related shift came in the form of this question: where do you go first for news about a company? In 2009, the top tier (29%) went to online search engine. Now the lowly search engine has dropped to 16%, bested by online news sources and print.

People saying bad things about you on the web? That’s cause to worry, because 59% of the survey respondents said they believe it if they hear it 3-5 times.  No wonder those celebrity death rumors on Twitter take hold so fast.

The Trust Barometer has tons more information but they sum it up neatly with this very simple graphic that shows how companies have had to change over the years.

In the past, it was all about controlling the flow of information making sure the public only saw what you wanted them to see. These days, however, it’s transparency that precedes trust.

Who do you trust?


Can LivingSocial Really Give Groupon A Run for Its Money?

Posted: 27 Jan 2011 10:39 PM PST

We have talked about the LivingSocial v. Groupon situation here before. It's always interesting how readers respond. There appears to be a very misguided line of thinking that Groupon has the lead in the daily deal space that is insurmountable and all others should just fold up their tents and call it a day.

Well, Amazon didn't just give LivingSocial $175 million because it was feeling generous. It did it because it felt like there was room to take a shot at Groupon. If the traffic chart below from Experian's Hitwise is any indication they may be right.

The key right now is that LivingSocial has to maintain the momentum that was generated by their Amazon gift card play earlier this month. That show of strength did wonders for the brand and took a bite out of Groupon's traffic as well. If they let it go though and don't push to keep the interest level high this could end up just being a one time event that will be a blip rather than a trend.

I think the whole Groupon frenzy has shown just how quickly things can get out of control in this current market. Groupon apparently thumbed its nose at Google's $6 billion offer then has recently tried to tone down IPO talk that was placing the company at a roughly $15 billion valuation. All of that seemed to happen too quickly to be real and this quote from a Crain's Chicago Business article this week shows that Groupon may be trying to dial back the hype a bit.

Groupon Inc. hasn’t decided whether to go public, board member Eric Lefkofsky said.

“There’s no definitive answer,” Mr. Lefkofsky said Tuesday. “We’ve made no decision at the present moment whether we will or won’t. We’re talking to bankers. We do talk to bankers all the time.”

Speculation about a potential Groupon IPO has been rampant in recent weeks, but insiders are downplaying the idea. Groupon CEO Andrew Mason told reporters Monday in Europe: “We’ve met with a bunch of bankers. We’re exploring whether or not it makes sense for us.”

Now the dust is starting to settle and the hypnotic hold Groupon seemed to have on everyone is being lifted a bit by a competitor. This is the kind of thing we all had hoped for in the search space so Google would have to try harder. In an area as new and as repeatable as the daily deal space there may be some hope for at least two real players to emerge if these traffic reports are any indication. Oh and let's not forget that Google is working on its Offers offering which may or not get traction but at least it's being done with a huge cash war chest to support it.

What's your take on the daily deal space? Is it being over-hyped? Is it the future? Will Groupon stay out in front or are they truly vulnerable?

Microsoft’s Online Efforts Keep Losing Money

Posted: 27 Jan 2011 09:57 PM PST

Microsoft reported good results yesterday for the last quarter of 2010. I guess the term good could be an understatement when you post a quarterly profit of $6.63 billion on numbers that beat the street. No one doubts that Microsoft is still a strong company with Windows, Office 2010, Xbox, Kinect and server businesses moving right along.

However, what we are interested in the Internet side of the ledger and it tells a familiar story that makes one wonder if Microsoft will ever make money online. The chart below from the Silicon Alley Insider gives a history of the excessive hemorrhaging that the online space has provided for the company with the latest quarter reporting a loss of $563 million.

To sum up, in the last 4 quarters alone this unit has suffered $2.5 billion in losses. So much for Bing and decide, huh? We suspect that there may never be a decision by Microsoft to get out of the space but with all the talk in the search world being around Bing making strides in market share, you have to wonder if those gains are worth it.

Search share is one thing but making money is another and Microsoft just can't seem to do that online. So will Microsoft simply continue to fund its online losers with the profits from elsewhere? Imagine if they didn't have these other businesses, though, to keep funding this chase for the search engine crown. Let's face it, the only reason Google has any competition at all in search is because Microsoft is willing to lose a lot of money to say they are in the game. Oh and the fact that they have the money to lose doesn’t hurt either.

Are these efforts really providing competition to Google or is it just stubborn pride to stick it out for as long as it takes to do whatever it is they want to accomplish?

What’s Your Social Profile Worth? About $4.00

Posted: 27 Jan 2011 03:56 PM PST

If you went to the store and bought $4.00 worth of goods, that’s not going to keep the place open for business. But when 1 billion people each spend $4.00, now you’re on to something.

Deloitte has just released the 10th edition of their “Predictions for the Technology, Media and Telecommunications” report and one of the questions is “Social Network Advertising: How Big Can it Get?”

The answer, they say is about 4 billion in 2011. That’s a combination of advertising, virtual goods and social network ecommerce. When you pull out only the advertising dollar, the ARPU (average revenue per user) drops to $3.50 which is still an expected rise over the $3.00 ARPU for 2010.

Deloitte says that even though social media advertising is growing incredibly fast, it still represents less than 1% of the total worldwide advertising dollar. Where things really get interesting is in the “other” categories such as virtual goods, where the growth rate is expected to top ad growth in social media.

They also point out that even though the ARPU numbers only tell half the story when compared to traditional search and display marketing.

“Thanks to a low cost base, social networks might still achieve impressive gross margins despite their relatively low revenue per user. . . A social network’s cost of content is close to zero since it merely provides the infrastructure, while its users and third party app developers provide all the content.”

Actually, there’s a third part to the story and that is the untested nature of social media advertising. Right now, we measure success with the tools used to define the success of any non-social media campaign and that’s probably not giving us the full picture. We simply haven’t been at this long enough to know the long term benefits of social media ad spending.

Deloitte’s prediction is that in the near future, social media advertising may take a backseat to other, more lucrative ways of using the medium to create revenue, ways we probably haven’t even begun to think about.
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