Digital Migration Into Uncharted Waters

Posted on January 31, 2013 by Tim Judd

So what’s a marketer to do? If you keep an eagle eye on Industry trends you will see some interesting and conflicting trends. The continued migration of dollars away from traditional media continues at pace. A survey from the American Marketers Association shows a 20–30% of respondents plan to move money with (as usual) newspapers being top of the hit list. Digital media in general and social in particular are slated to be the beneficiaries although mobile is lower than I would have expected. However, all is not necessarily sweetness and light. Although marketeers are trending to digital many of them remain confounded by the efficacy of the new medium. In another survey from Vizu another set of marketeers are unsure of how effective it is. In the survey fully two thirds of those surveyed were bullish on social media in general but unconvinced of ROI….a hold out 6% are convinced that it doesn’t work at all..

We are a little different to many marketeers. We don’t do brand support we do results based marketing only. If we don’t get the phone to ring we don’t get paid. We have tried social media as a direct response channel in many different ways with spectacularly underwhelming results. In many ways our hands are tied in that we can’t create social content on behalf of our advertisers and are frequently limited in how we can use logos etc. Mobile is the other large and growing beneficiary of the digital migration and the jury is out on that too. In our testing of mobile ad delivery search works…and works pretty well. Our testing with mobile display is quite different. Thousands of clicks which don’t result in any calls. Our experience of search targeted media indicates that it takes from 3 to twenty clicks to drive a successful call. Thousands of clicks with no calls indicates that the clicks aren’t from people looking for a product or service.

So as the migration continues marketeers are faced with developing channels which either don’t convert or are much harder to track than traditional media. Part of this complexity is the old marketing adage that half of advertising is wasted but we don’t know which. Digital media exposes exactly what does and doesn’t work…and maybe it’s close to three quarters of all media spend is wasted…and we can now tell which works.

Ha! Called It!

Posted on January 3, 2013 by Tim Judd

Boy…I wish I could pick sports like I can pick search! If you have been watching the news today in addition to the Fiscal Cliff going away (something I have been saying to any of my friends and family who would listen would happen since before the election) the FTC just threw in the towel in their investigation of Google. Not only did I call that they would get off effectively scott free they also gave up the minor concessions I said they would a few weeks back. Most significant of those are concessions around key patents they own which will prevent them from trying to claim ownership on pretty much every part of the mobile economy.

Whilst this isn’t a huge surprise given the commercial and lobby power Google commands the message is clear: The new and mobile economy is too important to mess with, even if that means protecting that the uncrowned king from assault from his resentful, truculent Lords and Barons. The fact that the commission apparently waded through 9 million pages of documents and testimony and came up with a conclusion that there was no “there” there is hilarious…what an enormous waste of effort….they could have read the firm warnings sent by the Google greats and their Silicon Valley supporters and saved a forest or two of trees. Actually I ran the math…if we figure they printed ten sets of documents during the investigation at 80,000 sheets of paper per tree they killed roughly 1,000 trees…so more of a copse than a forest…but you get my point.

Meantime in an echo of yesterday’s blog the Chinese have rather surprisingly just shut down Gougou.com. Ironically for a site which is clearly trying to copy even Google’s name they have been shut down for allegedly promoting too much pirated content in their results sets. This has to be a horrible blow to the parent company Xunlei who were planning to float on one of our exchanges. I guess they could try to re-launch but planning to drive traffic by being the next hot spot for the content pirates no-longer seems to be a viable business model. If this points to China taking other peoples intellectual property more seriously that has to be something we can all take heart from.

Still Destroying Major Markets; Internet Turns 30

Posted on January 2, 2013 by Tim Judd

The Internet was more or less officially born Jan 1st 1983. Back then I was just out of college selling advertising for a major London magazine using a rotary dial phone and paper index cards. It feels like a million years ago. Back then we enjoyed creative content through, commercial soaked radio stations, dead tree products like newspapers, network TV, vinyl records or tapes and VHS all of which we paid through the nose for through commercials or fairly large stacks of dollar bills. The networks could deliver vast prime time audiences, record companies, newspapers and movie makers were rich and powerful media giants and if you wanted to find something you had to go look it up at the library. A year or so later as a wet behind the ears sales guy if I wanted to send a sales letter I dictated it to a secretary and send it by snail mail.

As we start 2013 we are looking at a radically different landscape. Mobile will probably surpass desktops in terms of users and search, music has devolved to a medieval state where the only way for minstrels to make money is to play live for a line audience and movies are headed that way too. Newspapers are barely worth the paper they are printed on, the yellow book industry is almost gone, content piracy continues to impact multiple markets and as always the web mediates these processes. In spite of the fact that Google removed over 50 million URLs from their results last year (mostly in response to appeals from RIAA) it’s results continue to be chock full of pirated content and the sites promoting “sharing” through torrenting continue to feature ads served by the major search engines and ad networks.

An interesting side effect of this slow rolling revolution is the impact of the web on advertising as a whole. For example; I recently purchased roughly 75 episodes of Big Bang Theory on iTunes to watch on long flights. Each episode costs about $1 and buying them saved me watching or zapping through roughly 15 hours of ads. I have seen believable data which puts my value as an ad viewer at about 5c per 30 second commercial. That mean that by spending $75 to own the content the network lost about $18 of advertising, a pretty good deal for the network even factoring in fees to iTunes etc. This equation of trading dollars for interruption through platforms like iTunes, Netflix and Amazon Prime will likely continue to drive the advertising world half insane in 2013. Add to that that the pervasive but confounding social media it’s clear that the Internet will continue to confuse advertisers who traditionally move at a glacial pace.

At the same time the web has obliterated music, yellow books and newspapers it has given birth to massive new markets, freed us from the sway of media giants who often don’t have our best interests at heart, facilitated real social and political change and as a bonus allows us to live pretty much commercial free if we choose to. It has put the information of a large chunk of humanity at our finger tips and allows us to be much more connected with family and friends if we choose to be. I experienced this myself just last week in London. By some oversight I didn’t have the UK added to my data roam program, so I found myself in London unable to call, search, navigate or email for as long as it took me to resolve with Verizon….about 6 hours. Those were 6 of the most uncomfortable and confounding hours I have experienced recently. After 30 years the Internet married to mobility has truly addicted many of us to the point where being without it is just about unthinkable. Hi, I’m Tim and I’m and Internataholic….Hi Tim! Here’s to the next 30 years

“Twas the Blog Before Christmas”

Posted on December 24, 2012 by Tim Judd

It’s nearly that time…I don’t think I’ll be posting much over the break, so here’s what probably amounts to my final post for 2012. Looking back over close to 100 blogs throughout the year it’s striking (to me anyway) just how much happens in our space and how much that impacts the real world around us.

This year we have seen mobile usage and commerce explode worldwide but especially in the US. We typically lag the front runners by a year or two and this year mobile finally made it happen. Over all mobile search volume went from less than 10% to (by some reports) closer to 25% of traffic and it’s possible that mobile will outstrip desktop next year..a full year earlier than expected. At the same time local traffic grew dramatically. That’s perhaps not that surprising given the growth in mobile, but as the guys who have been saying that local is the next big thing I take a certain amount of satisfaction in the 30-50% local intent query numbers we are seeing.

2012 saw the reshaping of social after the debacle of the Facebook IPO. There is still a lot of opportunity in social and more recently there has been some encouraging data on how social may eventually monetize. What I find most intriguing is the idea of using social signals from the relatively few who do engage socially with a product or service to generate a profile of what a customer might look like then target that potential customer in volume through search and social media….it’s complicated and sometimes slightly creepy stuff.

In 2012 Google continued to rule supreme in spite of multiple assaults for “evil” behavior at home and abroad. As I type the FTC is wrapping up it’s investigation into Google and it looks like big G will skate unharmed on their home turf, they may yet have a tougher job convincing their tougher critics in the EU. I feels like almost every day there is some new announcement or development which makes out engagement with the real world as expressed through the virtual world of search and mobile deeper, richer and sometimes scarier.

The world we serve, that of driving new clients to huge numbers of local businesses through search and all kinds of new media has become both more exciting and much more complicated. Given the plethora of media the choose from (search, SEM,SEO, social, local display and mobile to name but a few) and the continued decline of traditional media it’s becoming almost impossible for the average SMB to navigate that complexity. We solve for that by using all those new media on a massive scale to drive the high quality leads the local businesses need. We spent much of 2012 developing the machines needed to make that happen reliably and at scale, 2013 will be the year that hits big.

On the grander scale our industry has enabled revolution and reform and has been attacked by tyrants around the world. We have created enormous amounts of new wealth (and destroyed quite a bit with Facebook). Search is becoming pervasive and in some ways invasive. The mobile device is becoming the prime way of engagement for many more activities and with recent developments in both Apple and Android location based commerce (L-Commerce) will likely become ubiquitous in 2013 changing our world yet again.

For my self, on Leap Day I married my last and final wife, saw my oldest son graduate college and working with our team of hard working, inspired and inspiring people we reshaped our business to lead the upcoming local revolution. I trust your year was equally happy and productive. I wish you and yours a wonderful Holiday Season….Merry Christmas to all…. and to all a good night.

Yahoo Surrenders Local

Posted on October 24, 2012 by Tim Judd

As I have mentioned in many previous posts I like Yahoo….I have always liked Yahoo. Back in the day when they were the cool kids complete with huge goofy purple chairs they didn’t let being wildly successful turn them into corporate monsters. They have famously had a horrible last few years with Google cleaning their clock in search and multiple other miss steps. When Marissa Mayer assumed control it was clear that she had to pick the battles she was going to fight. Back when she joined in July I appealed to her from these very pages to put Local on her to “fix and focus on” list. I didn’t think for a moment she’d hear me (I’m not that delusional) but I was saddened a little to see in her recent discussions around Q3 results that Yahoo won’t be focusing on local going forwards. It’s understandable, Yahoo local is broken. As one of the people who attempts to work with them on behalf of our clients they have been grinding to a halt recently. It would take an effort worthy of the New Deal to jump start the platform so it’s understandable that the resources might be further diverted from this red headed step child. Central to Yahoo’s Brave New World is (of course) mobile. Call me crazy but don’t local and mobile go together? The recent Apple Maps fiasco points at how hard it is to do maps and by adoption, local. Yahoo Local as a directory has been stuck without focus or a reason to thrive, and has missed the kind of location based innovation and reviews championed by FourSquare and Yelp. Could Yahoo have taken on local as a central part of their mobile strategy, probably. However if the end game for Yahoo is to land on the carrier deck of one of the other flag ships in the continuing online Battle of Midway being waged by Apple, Google and Microsoft it probably makes less sense to invest in something which could be improved with minimal cost by simply signing over the entire thing to another player like Bing.

A moment’s silence please in memory of Yahoo Local.

The 43% Solution

Posted on October 8, 2012 by Tim Judd

For an industry predicated on information and tracking it’s amazingly hard to come across hard data which is widely agreed on. A couple of years back Google officially told a waiting world that about 20% of all search is local or has local intent…..that was the last hard statistic we had on the subject. Subsequently there have been a couple of tidbits from the likes of Yahoo which pointed to 25% of search as local, but agreed hard numbers in search remain scarce. The good folks at Chitika have just released data they collected in September points to 43% of searches being local. That’s a huge number…Chitika is an ad network started by a couple of my Lycos Alumni and I’m sure their data is as reliable as it’s likely to be. That 43% doesn’t include a lot of searches which are done through mobile devices so it’s likely to be an even larger absolute number. At a recent informal gathering a Googler was unofficially quoted as saying local search is “about half” of all search. Traditional search has slowed in growth somewhat of late but the overall volume of search (especially driven through apps and mobile) continues to rise dramatically.

It shouldn’t be that surprising that the explosive growth of smart phones is driving search but it’s good to get reasonably independent confirmation of the numbers. Mobile is inherently local so it makes sense that we look for things local on it. When we use our smart phones for search it’s a pretty good bet that what we are looking for is a phone number we can call from that phone…..all those factors are accelerating the drive to Pay Per Call local lead generation especially through mobile search….which coincidentally is what we are all about.

Up the Amazon Without a Paddle?

Posted on September 6, 2012 by Tim Judd

We use search for just about everything, Google has famously become a noun, a verb and who knows..is about to become an adjective too. Whilst it’s awesome to find out things like (after watching Clinton last night) which amendment would we have to repeal in order to re-elect him (the 22nd) it makes its money from shopping searches. Those shopping searches have traditionally come from desktop users using Google to price compare for both online and offline purchases. However there is an interesting argument emerging that says that Google might end up duking it out with an unexpected rival…not Yahoo! or Bing or even Duck Duck Go….but Amazon. The little book seller who could has become the unexpected gorilla in the room in online sales and may end up as an inadvertent search gorilla too. With the continued growth of mobile devices and the increasing trend for users to cut out the middle man and go straight to Amazon to compare and shop there is at least some danger that Google will be left holding the proverbial 22nd amendment query baby while the shopping search goes straight to Amazon.

Obviously this isn’t going to hurt the mighty Google badly anytime real soon. Amazon revenues are in the same ballpark as Google but their margins are much thinner. However Google’s juicy margins are driven by shopping searches and the average price per click Google is achieving has been in pretty steady decline for a year. As I reported in an earlier post the move to mobile is driving this trend more than any other single factor. To add insult to injury mobile users are increasingly bypassing Google entirely and comparison shopping on shopping apps like Amazon….it will be interesting to see how this plays out.

Papering up the Jobs Legacy

Posted on August 27, 2012 by Tim Judd

The verdict heard round the world was handed down on Friday when Apple won its patent infringement case against Samsung. Its ramifications are going to reach beyond the immediate case (a Billion here or there is no big deal to a company like Samsung with 21Bn in their checking account). If you listen carefully you can hear the attorneys rubbing their hands together in anticipation. We are a mere minnow in the ocean of IP and tech value where the big fish sue the bigger fish but this is likely to send shock waves across the entire space. Software and hardware manufacturers will have to pay Apple or come up with a radically different solution to steer clear of similar threats.

As I have blogged many times in the past mobile is where the future lies, for example I just read a recent report which said that daily deals sites are getting more traffic from mobile devices than desktops already and that trend is going to become stronger over time. Having swung and hit Samsung as hard as they have there are no major cash prizes for guessing that Android is next. Shortly before he died Jobs summoned Brin and Page (the Google founders) to essentially yell at them for copying the Apple iOS with Android. I don’t think they reached a conclusion and Google is certainly unapologetic about the similarities between their baby and the iPhone. No doubt the courts will eventually get round to this too. Given the recent verdict there has to be a good chance Apple will win. That could be calamitous for Google in many ways. The very fact that they might lose will likely shake the market and may strengthen even further Apples hand. Back in the day when Android launched, a key driver for Google to essentially give away the platform was the thinking that eventually the world will be mobile and he who controls the handset will rule the earth. However handsets operate on networks and unless Google buys AT&T or T Mobile (and the might yet) the mere fact that Android devices may be significantly impacted by a verdict against them may well tip the scale towards more networks doing a deal with Apple. That way they aren’t in danger of being left stranded or scrambling to produce a non android non Apple solution. By the way on that point we should expect to see a scramble for exactly that from multiple sources…though how you come up with a competitor to an iPhone which doesn’t impinge on patents as fundamental as two finger zoom is beyond me.

When Jobs died he left a legacy of innovation which has driven our world and has been slavishly copied by many. The Apple team appears to be moving to paper up as much as they possibly can to secure every ounce of value they can from his legacy. Once upon a time leadership in cell phones was seen as a good business opportunity…with the dash to a mobile life underway that leadership is even more important. The much vaunted iPhone 5 is on the wings, a thinner larger more powerful 4G device is already poised to be the biggest launch in phone history. That launch coupled with the uncertainty generated by the Samsung verdict could well jump Apple to an even stronger position as this market accelerates. Can Apple find a new wave of innovation to continue what Jobs started?…who knows….but securing that legacy in the courts may yet win that battle after all.

Climbing Mount Mobile

Posted on July 27, 2012 by Tim Judd

You have to wonder when newspaper publishers will ever get a break. They have been one of the biggest casualties of the digital revolution, late to the party they have been sprinting to catch up with the desktop…then mobile happened. Just in case you have been hiding under a rock for the past couple of years mobile is catching up with static viewers and the smart money says it will pass them in page views by 2015. Similarly (according to Borell) mobile ad spend is projected to out strip mobile at an even faster rate. Are local news providers geared up to address this opportunity or threat? Probably not. They are catching up with the local mobile ad space and most of them have mobile enabled content and or Aps of some kind. There are lots of loose ends..some persist with paywalls most won’t allow citizen based hyper local journalism to flourish under their editorial guidance.

End users are flocking to mobile engagement but there is nothing which guarantees local media will be the recipient of that migration. The pure plays which have already obliterated key revenue verticals like automotive and classifieds have already transferred to mobile in ways which most newspapers simply don’t have the resources to do. The danger is that the publishers will arrive panting to the online party to find it’s moved on to mobile and there’s only the clean up crew left to talk to. The message has to be Go Big Go Mobile or Go Home….sadly it’s a choice which has already been made for them in many cases.

The New Boss….Same as the Old Boss

Posted on June 25, 2012 by Tim Judd

Everywhere you look today the story is that local businesses are moving to a Pay Per Call approach. However if we are to believe the latest Kelsey report on local and mobile media this is just the latest manifestation of a major trend. The Kelsey crew claim that last year of the nearly $133B spent on local advertising 60% was focused on driving leads as calls. The spend is across all media but the focus is strongly on lead generation and that trend is gathering even greater momentum. This trend is accelerated by the breakneck growth of smart phones. Kelsey claims that by 2015 the volume of queries from mobile devices will equal all desktop queries, that sounds credible to me. They also claim that conversion from the mobile device to the paid phone call is eight times more likely than from the desktop. I’m not sure I buy that number as we have always seen desktop view to call at closer to 30% but it makes sense that the mobile devices should convert really well.

Interestingly they claim that only about 22% of those calls were generated through paid search. Certainly we use paid search to drive calls but other media such as mobile syndication and even local radio are also extremely effective in driving tracked paid calls. The largely untapped inventory of as yet largely un-targeted local display inventory is another enormous opportunity still emerging. Of all channels we use currently desktop driven search and calls coupled with mobile syndication across the board…mobile search and mobile devices seems to be the most powerful combination.

The rapid drive towards a Pay Per Call based ROI focused approach is even driving traditional publishers. In a world where even the most laggardly local business have figured out that spending money on calls which produce new business makes great sense even traditional print and broadcast media are embracing the paid call as a logical way to prove value. If you are able to drive value people will buy your product. The the adage was that half of all advertising is wasted but you can’t tell which half…now you can.

ThinkJudd

I think therefore I search

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