Going Native: Disqus Says Promoted Discovery Ads Getting Traction

disqusadFrom my Forbes.com blog The New Persuaders:

Any blogger or media site knows there can be a lot of garbage in the comments on their posts and stories. Now, there’s a little gold in them, too.

A couple of months after quietly rolling out an ad system to select advertisers and publishers, commenting service Disqus is revealing a bit about the initial results. The ads build upon an article discovery feature Disqus introduced over the summer, a box below the comments that provides links to related articles either on the site or elsewhere on the Web. Disqus, which claims 75% market share among independent commenting systems such as those from Facebook and Livefyre, says 900 million unique visitors a month view 6 billion pages monthly on 2 million websites.

Promoted Discovery units are a way for publishers and advertisers (which also may be other publishers) to buy links that will send traffic their way. They barely look like ads, but that’s the point of so-called native monetization, also employed in Facebook’s Sponsored Stories and Twitter’s Promoted Tweets: They seek to avoid disrupting the flow of what people are doing, especially in a social setting–or, if you’re a cynic, they seek to conceal the fact that they’re ads. Either way, though, they often get more clicks and other engagement. …

Read the complete post at The New Persuaders.

 

About these ads

Instagram Backs Off New Photo Policy–But Here’s How It Might Really Make Money

Image representing Kevin Systrom as depicted i...

Instagram cofounder Kevin Systrom (Image: CrunchBase)

From my Forbes.com blog The New Persuaders:

Not surprisingly, the Facebook-owned mobile photo-posting service Instagram has backed off the language in its new privacy and terms of service policies that set off a firestorm online. The worry was that people’s Instagram photos could be sold without users getting compensated (never really true) or could be used in ads (which did certainly look likely).

Apparently, neither will be the case, at least for now. Instagram cofounder Kevin Systrom just posted on the company’s blog under the title “Thank you, and we’re listening”:

I’m writing this today to let you know we’re listening and to commit to you that we will be doing more to answer your questions, fix any mistakes, and eliminate the confusion. As we review your feedback and stories in the press, we’re going to modify specific parts of the terms to make it more clear what will happen with your photos.

Legal documents are easy to misinterpret. So I’d like to address specific concerns we’ve heard from everyone:

Advertising on Instagram From the start, Instagram was created to become a business. Advertising is one of many ways that Instagram can become a self-sustaining business, but not the only one. Our intention in updating the terms was to communicate that we’d like to experiment with innovative advertising that feels appropriate on Instagram. Instead it was interpreted by many that we were going to sell your photos to others without any compensation. This is not true and it is our mistake that this language is confusing. To be clear: it is not our intention to sell your photos. We are working on updated language in the terms to make sure this is clear.

Systrom then provides clues to how Instagram might really make money from advertising on the site:

To provide context, we envision a future where both users and brands alike may promote their photos & accounts to increase engagement and to build a more meaningful following. Let’s say a business wanted to promote their account to gain more followers and Instagram was able to feature them in some way. In order to help make a more relevant and useful promotion, it would be helpful to see which of the people you follow also follow this business. In this way, some of the data you produce — like the actions you take (eg, following the account) and your profile photo — might show up if you are following this business.

The language we proposed also raised question about whether your photos can be part of an advertisement. We do not have plans for anything like this and because of that we’re going to remove the language that raised the question. Our main goal is to avoid things likes advertising banners you see in other apps that would hurt the Instagram user experience. Instead, we want to create meaningful ways to help you discover new and interesting accounts and content while building a self-sustaining business at the same time.

So it seems that whatever advertising Instagram does, it will be quite a bit like Facebook’s Sponsored Stories, or even precisely like them. Although that won’t comfort people who don’t like the possibility that their actions can become an ad, they’re already subject to those terms if they use Facebook.

I wouldn’t be surprised to see Instagram follow Facebook’s well-worn playbook, which calls for the company to push the envelope, then back off a bit, rinse, repeat. But for now, pending future changes, your cute cat photos are safe from becoming ads for your local pet salon.

Here’s A New Way You’ll Soon Get Targeted For Ads: Your Hashtags

Screen shot 2012-12-11 at 8.17.52 PMFrom my Forbes.com blog The New Persuaders:

Facebook has Sponsored Stories. Twitter has Promoted Tweets. Buzzfeed has Promoted Posts. They’re all based on social gestures and activities, each targeted to people, whether friends or birds of a feather, who might share similar interests. Now, a company has come up with a new way of targeting people using one of the most common social gestures of our time: the hashtag.

If you’re bothering to read this, you probably already know hashtags are those short subject labels, starting with a # or hash sign, that describe the topic a tweet or other shared item is about. They didn’t start with Twitter, but they became popular thanks to their common use in tweets. That use has spread to other social networks, from Pinterest to Instagram (though not very often on Facebook, for some reason).

Today, social ad firm RadiumOne announced it’s making hashtag targeting available to advertisers so they can reach like-minded consumers in real-time across the Web based on the hashtags they’re using. So, for example, says RadiumOne founder and CEO Gurbaksh Chahal, Nike can reach consumers who use the hashtag #nike, or #olympics, or #fitness with ads for running shoes. Or McDonald’s could target people who tag their tweet or Instagram photo #burgers or even #hungry. …

Read the complete post at The New Persuaders.

 

Venture Capitalists: We’re Doing Fine! Really!

4444 students from 25 schools in Gwalior

Image: AFP/Getty Images via @daylife

From my Forbes.com blog The New Persuaders:

With so much turmoil in the venture capital business, from the rise of competing super-angel investors to tepid fund returns for the past 10 years to some big IPO duds this year from the likes of Facebook, the future of this economic engine of innovation is pretty murky. But to hear VC investors on the opening panel of the Silicon Valley Venture Summit held annually in the coast-side community of Half Moon Bay by business media network AlwaysOn, there’s not much to worry about.

On the panel addressing the “VC & Investor Outlook for Global Silicon Valley” were host Packy Kelly, partner and co-head of KPMG’s U.S. Venture Capital Practice; Norm Fogelsong, general partner at later-stage VC Institutional Venture Partners; Neal Dempsey, managing general partner at early-stage VC Bay Partners, which has gone through its own travails in the past couple of years; and Gaurav Tewari, director of SAP Ventures. Here’s what they had to say about the state of the VC business:

Q: Where are we in terms of the VC cycles today?

Fogelsong: The industry’s healthy. Things got quite excessive in the bubble, and now we’re back up to $15 billion to $20 billion that’s healthy for the industry.

Dempsey: Companies are going to have major exits, and I’m convinced it’s going to be fine over time.

Tewari: The pace of innovation and entrepreneurship is just accelerating. It’s a very exciting time. The numbers are mixed. The number of folks in the industry has shrunk 30% in recent years.

Q: Is there still ample capital to invest?

Fogelsong: Yes. But we’re still burning off the excess of the bubble.

Q: How have things changed in terms of the choices entrepreneurs have now–angels, seed funds, accelerators?

Dempsey: It’s only better for the industry. The angels provide this huge infrastructure of small investments that we can’t make. We can see what trends or companies are working. When we get involved, [unlike angels who make dozens of investments a year], we’re hands-on.

Fogelsong: But if you’re thinking of getting angel financing, get an experienced angel. Some of the new ones don’t realize their investments are going to need follow-on financing. …

Read the complete post at The New Persuaders.

News Flash: You Never Really Had A Vote On Facebook Anyway

Screen shot 2012-12-10 at 4.20.30 PMFrom my Forbes.com blog The New Persuaders:

So the vote on Facebook’s new policy-voting policy fizzled. (Yes, it was that confusing.)

But so what? The fact is, neither Internet services like Facebook nor, really, any other business is a democracy. Facebook instituted the trappings of a democracy with its previous policy that called for a vote on new policies if thousands of members commented on it, presumably in a mostly negative fashion. A vote was triggered on three occasions in the past few years–and now for the last time.

The vote, which closed todaycame in overwhelmingly against the changes in Facebook’s data use policy, which included eliminating a vote on such policies. Some 88% of respondents voted against the new policy, apparently hoping to retain the right to vote. The problem: The voting policy in question required 30% of the site’s 1 billion-plus members to vote in order for a policy change to be overturned. And only about 0.07% voted at all.

Good thing we don’t vote that way for public offices, or we’d never elect anyone–although some libertarian wackos citizens might think that is a good thing.

Anyway, the tepid turnout just goes to show that the voting was a sham in the first place. I don’t know that Facebook purposely set it up that way, since I have no reason to attribute evil intent to its executives. But surely the company had to know that by requiring 30% turnout of its 1 billion members, it was a 100% certainty that almost nothing short of a requirement to publicly disclose your Social Security number would ever elicit enough votes to make any difference.

And that just goes to show how ridiculous the supposedly democratic method was. The failure of the voting mechanism also shows that Facebook itself needs to rethink how it proposes changes and how it deals with the aftermath. The joke often made about Facebook, especially with regard to its constant privacy blowups, is that CEO Mark Zuckerberg makes a change, then apologizes if there’s an outcry, but doesn’t change much (if at all), and eventually people get used to the change anyway.

That may not be the best way to deal with things, but you can hardly argue that it didn’t work. Unremarkable IPO aside, Facebook is a runaway success, no thanks to any amount of faux democracy. Can you imagine Google or (snort) Apple putting their policies to a vote?

In some cases, Facebook may need to back off Zuckerberg’s clear intention to push the envelope on getting people to reveal more about themselves online. In other cases, it simply needs to be more careful in explaining the benefits of its policy changes. And in all cases, it has to realize that it can never please everyone.

But ultimately, you do retain the right to vote about what Facebook, or any other company, does: You use the service, or you don’t. You don’t like something–really don’t like something–then you stop using the service.

Facebook users voted a long time ago. Their mostly mute response to the latest vote clearly says that’s the only vote they care to make.

Here’s Why Facebook Likes Microsoft’s Atlas Ad Server

fbthumbsupFrom my Forbes.com blog The New Persuaders:

After spending years trying to dump its Atlas online ad-serving business, Microsoft reportedly is in talks with Facebook to sell the unit that helps advertisers and ad agencies place ads on websites and track their impact.

The news comes five months after Microsoft wrote down nearly the entire value of its $6.3 billion acquisition of aQuantive, of which Atlas was a part. Following its recent move to de-emphasize its own ad tech, Microsoft has been shopping the unit around, most recently to AppNexus. Business Insider reports that before Facebook talks began, the highest bid Atlas got was $30 million.

There’s no guarantee the deal will happen. But why is Facebook interested? Some speculate that it’s a way for Facebook to close the final technology gap on a plan for an ad network, similar to Google’s AdSense, that would place Facebook ads on other websites. Could be. But I tend to agree with one AppNexus Senior VP that there’s an even bigger goal that goes along with that: proving Facebook ads work.

That has been the No. 1 social network’s overriding task for the past year, especially since its underwhelming IPO. It has released vollies of case studies showing how its ads actually do spur sales down the line. But for whatever reason, most likely the difficulty of applying success by one company or industry with its social ads to others, many advertisers and agencies remain skeptical.

Atlas would enable Facebook to track the impact of its ads, which it’s already quantifying through a deal with Datalogix, which tracks in-store sales, not just on Facebook but on other websites as well. Privacy advocates are not happy about the Datalogix deal, and adding an Atlas-powered ad network won’t make them any happier.

But Facebook may finally be on the verge of closing the elusive loop between its ads and ultimate sales that result from them in a way that to date no one but Google has done really well and on a huge scale.

No Brand Shakedown, Says Facebook–Here’s How Page Posts Reach Fans (Or Don’t)

From my Forbes.com blog The New Persuaders:

A lot of businesses with Facebook pages are up in arms about their posts showing up in their fans’ news feeds way less often lately. They and their ad agencies think Facebook did it deliberately to force them to buy ads to promote those posts, and they’re not shy about telling the world about it.

Facebook says it did change its EdgeRank algorithm, which decides based on various criteria which posts individual Facebook users see in their news feeds, in September, chiefly to help reduce spam messages. But the No. 1 social network, which has been intensifying its efforts to boost ad sales following a disappointing IPO last May and a swoon in its share price, categorically denies that it’s essentially blackmailing brands into buying ads by reducing their reach with fans. In fact, it says posts are showing up overall at about the same 16% they’ve been for awhile now.

Indeed, it has just opened up a new news feed option that runs only posts from pages you’ve “liked.” The move won the approval of Mark Cuban, whose anger in one tweet catapulted the issue into the public eye. But lots of questions remain.

Today, the company is trying to get the word out about how its system works with a “whiteboard lunch” for the press, with the aim of explaining how page posts find their way into news feeds. I’ll cover the highlights here starting about noon Pacific time, so refresh until about 1:15 p.m. for the latest. It’s pretty casual, not a formal presentation, so most of this will be a little scattered, but potentially useful to marketers.

Will Cathcart, product manager for news feed, comes on first to tell how Facebook thinks about the news feed. On an actual whiteboard! He says Facebook tries to figure out how interested you will be (Yoda, in his example) in each page post. If he comments on or shares or likes (or “hides”), say, posts from the Rebel Alliance, those will show up more often. But if he reacts in a significant way to a post by, say, Vader, that will inform future visibility of Vader’s posts. If he often complains that posts from, say, the Empire, those posts may drop out of his news feed entirely. …

Read the complete post at The New Persuaders.

Uh-Oh–Survey Says Most People Find Facebook And Twitter Ads Misleading

From my Forbes.com blog The New Persuaders:

To hear Silicon Valley and nouveau ad-tech types tell it, traditional advertising sucks. The best way to attract people’s attention and engage them more fully is to create ad formats that more closely resemble the activities people are already doing on a site–in other words, to make ads look less like ads.

That’s the idea behind so-called “native” ads such as Facebook’s Sponsored Stories and Twitter’s Promoted Tweets. Although various studies seem to indicate these ads are indeed more effective than standard banner ads–a low bar, it must be said–a new survey released today indicates that a lot of consumers don’t trust native ads. According to the survey by app advertising firm MediaBrix and Harris Interactive:

* 45% found Twitter promoted tweets misleading.

* 57%  found Facebook sponsored stories misleading.

* 86% found sponsored video ads that appear to be content misleading.

The survey also found that a large majority of people who have seen Twitter Promoted Tweets in the past 12 months said they hurt or had no impact on their perception of the brand advertised. Some 72% said the same thing about Facebook’s Sponsored Stories. And 85% found sponsored video ads didn’t leave them with warm feelings. “While anyone pushing the native ad agenda or otherwise would agree that we need to provide user experiences that are not jarring or disruptive, we also need to ensure that we are direct and honest with our consumers about when they are being marketed to,” MediaBrix CEO Ari Brandt said. “Some formats achieve this better than others.”

Mind some caveats about this research. For one, it doesn’t compare native ads to banner ads, so there’s no telling whether trust in banner ads is any better than these native ads. Also, what people say they feel about ads and brands may have little to do with the ads’ effectiveness. And MediaBrix has a dog in this hunt, since it offers its own kinds of ad formats for social and mobile apps.

Still, it’s a splash of cold water on a trend that some very high-profile companies are counting on to become the next Google. And it’s a lesson that marketers apparently constantly need to be reminded about: Don’t try to fool your customers, because it can destroy trust in your brand.

Why Do Obama Supporters Appear In Facebook Ads As Romney Fans?

From my Forbes.com blog The New Persuaders:

Recently, I’ve been seeing a Sponsored Story ad on Facebook pages indicating that several friends “like” Republican presidential candidate Mitt Romney. No surprise there. Sponsored Stories are those personalized ads the social network allows advertisers to run that show friends have “liked” a brand, and they’re increasingly common as Facebook doubles down on social advertising.

But what on Earth was the name of a friend, who I know is a vocal Obama supporter, doing on a Romney ad? The answer raises questions about how effective, or at least how accurate, these ads are–not necessarily due to a particular fault by Facebook but thanks to the byzantine rules and privacy features that have developed over years of user outrage and resulting Facebook accommodations.

Anyway, I asked my friend if he knew he was shilling for Romney. His response:

“Lol…..I liked him so I could see his FB feed. You should read my comments.” [Hint: They're not complimentary.]

To be clear, you can see Romney’s posts on his page without “liking” him, but to see them in your own news feed, you need to “like” him. And once you do, like it or not, you become potential fodder for an ad that will appear to your friends.

Another friend of a friend who’s an Obama supporter also was surprised to see his name on a Romney ad. He told his friend:

“I never liked his page. I commented on one of their crazy lies.. gave them a serious piece of my mind ya know!!!!! All kinds of people have been telling me why do u like Mitt???? I’m pissed!!!” …

Read the complete post at The New Persuaders.

Did The Bubble In Facebook Ad Startups Just Pop?

A little crowded, perhaps? (Source: LUMA Partners)

From my Forbes.com blog The New Persuaders:

For much of this year, hundreds of little and not-so-little startups that help businesses run advertisements on Facebook have been playing the M&A game, buying rivals or related companies, getting acquired by bigger firms, or both. But the acquisitions were sometimes for big bucks, fueling a sense that the opportunities were huge for social marketing startups.

It’s not hard to find social marketing firms still thriving, but suddenly it’s looking a little more like a game of musical chairs. And while it would be easy (and wrong) to say the music has stopped, it’s becoming clear that a chunk of those firms will find themselves without a seat as the social media biz starts to mature and its growth chart no longer looks like a straight line up and to the right.

The recent struggles of Facebook and other social media firms such as Zynga aren’t new, of course. They prompted some folks to wonder if the social media bubble had popped a couple of months ago. But it appears now that advertiser uncertainty about social media is starting to hit the still-crowded ecosystem of social media marketing and ad firms.

Today, Salesforce.com laid off about 100 people from two social-media acquisitions, Radian6 and Buddy Media. Although it may not be surprising given likely job overlaps–and the fact that Buddy was losing big bucks before the sale–the layoff suggests that the market for social ads isn’t big enough to accommodate all the players that have sprung up in recent years, or at least all the employees working for them.

Read the complete post at The New Persuaders.

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