Yes, There’s Fraud Online. Deal With It.

Breaking: everything you see and read on the internet isn’t true.

Hope you were sitting down for that surprising revelation.  I know, I know, it’s not that big a surprise, but that’s why it’s constantly surprising that people are…surprised by it.

A reporter from one of this country’s leading metropolitan dailies contacted me recently about the late-summer revelation from Facebook that some 83 million (or 8.7 percent) of its user accounts are fake. Facebook is, after all, a platform based on the value proposition that its users are behind real identities.

Doesn’t this blow Facebook’s value proposition out of the water, the reporter wanted to know. Isn’t this an incredibly high number of fake accounts? How could they allow this to happen?

Relax. The problem is hardly endemic to Facebook. Fake accounts, whether malicious in nature or not (Facebook estimates only c. 1.5 percent of active accounts are, in fact, malicious – the others are mostly duplicates, users under the age of 13, your dog, etc.) come with the territory – online or off.

Facebook is working to identify and disable fake accounts just as the search engines are working to combat click fraud – for years now. As ISPs work to block oceans of spam.

Oh, and did I mention fake online reviews?  Yelp has resorted to a sting operation aimed at shaming businesses that are caught trying to game their ratings system. They’re posting “consumer alerts” on those businesses’ pages, and exposing the emails they send to hire favorable reviewers. (TripAdvisor is also participating in its own version of the walk of shame.) So widespread is the fake-review practice that Gartner estimates by 2014, 15 percent of all online reviews will be fake.

Companies running online sweepstakes often encounter fraud, fakes and undesirable metrics in short order. A few years back, I looked under the hood of several soft drink sweepstakes aimed at males aged 12 – 24 (Coke, Sprite and Mountain Dew, to name a few of the brands). I asked Hitwise (now Experian Hitwise ) to crunch the data. They clocked the overwhelming majority of entrants as low-income females…over 45. They weren’t clicking on ads, but rather on a link on contest-aggregator site Sweepstakes Advantage.

Blame the Internet – Or Human Nature?

Somehow, when fraudulent, misleading or even unintentional things happen online, “the internet” is to blame. Or Facebook. Or Google. Or the dating site that was a 14 year old girl’s first step into a bad situation – never mind that a 14 year old had no business being on the site in the first place.

No one seems to be stepping back and saying things like, “Contests are overwhelmingly popular with low-income, middle aged women. Is it wise to run a sweepstakes to reach young men? If we do elect to go that route, how can we ensure we reach the target audience?”

Just as retailers account for “shrinkage” in financial forecasts, digital marketers must account for wasted clicks and impressions. Comes with the territory. There’s always going to be clickfraud. Chihuahuas and Yorkies will continue to update their Facebook newsfeeds (or, even further violating Facebook’s TOS, allow others to do this for them.) People who aren’t 100 percent neutral (like maybe the owner’s mother-in-law) will review restaurants and hair salons – favorably or unfavorably, depending.

Offline Corollaries are Much Worse

While the media are quick to blame “the internet” for a multitude of crimes related to fraud, companies like Facebook, Yelp, TripAdvisor, Google, Bing, Yahoo, and all the major ISPs get little public credit or acknowledgement for their efforts to combat said fraud. Much of the knowledge we have of online misconduct was revealed by these companies themselves. It’s transparency and disclosure.

Not so their offline bretheren. A quick search of “inflated circulation” results in a veritable rogues’ gallery of news stories indicting companies like Time Inc., News Corp, Newsday and other major publishers of being caught in the act – not openly revealing they are combatting a problem.

Forbes recently indicted USA Today for padding hotel bills to the tune of $82 million annually for those unwanted, untouched copies of the newspaper in front of your door in the morning (nearly one million copies per day that you probably don’t read, and probably are billed for).

Online fraud? Yeah. It’s a problem. It will always be a problem. Just like in the real world.

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The Cat Food Would Like to Have a Word: The Sentient World Meets Marketing

Characters on packaging sing and dance. Retail inventory “knows” where it is in the store, and when it needs to be restocked. Invisible coupons can be snatched from the ether, and    mobile devices can lead shoppers to items that match pre-selected criteria (low-fat, gluten  free and strawberry flavored). Open the car door and, as the heat and engine automatically start, the seat slides to your preferred position.

The sentient world is no a radical future vision, it’s present reality. Readily available technologies such as smartphones, Google Goggles (and soon, Glass), augmented reality (AR), smart keys and fobs, even laptops make it increasingly easy to apply layers of content, images and information on top of object, products, and places. And at the same time, to view and experience these additional layers of content. Technology developments will soon enable more and more objects to become sentient, as Corning so elegantly depicted in its highly successful A Day Made of Glass Video:

Brands, particularly those aspiring to a cutting-edge image, have embraced advertising and marketing in the sentient world. Augmented reality almost seems old hat when you start totting up brands that have tried it, including GE, Nestlé, Lego, Kellogg, Mercedes-Benz, and Tesco. Ben & Jerry’s augemented ice cream lids. Starbuck’s experimented with enhanced coffee cups.

An iPhone app created by Dentsu in Japan allows shoppers to see animated butterflies flitting by. Each butterfly contains a coupon for a nearby business. In-store smart kiosks are becoming popular, as are apps that facilitate shopping. IBM has developed an app that finds what shoppers are looking for by scanning the shelves with a smartphone’s video camera

The sentient world goes far beyond in-store and CPG applications, of course. Destination and place marketing creates enormous potential both for data and for marketing and advertising applications. Kia, for example, a US Open sponsor, put a layer of information over last year’s event.

Unquestionably, as technology becomes increasingly sophisticated as well as cheaper, and as consumer adoption of smart devices soars, the world of places and things will become increasingly sentient. This raises a number of questions marketers must begin addressing now in order to intelligently introduce content – literally – into other dimensions.

1. Whose data surrounds your product? From a marketing perspective, the sentient world fundamentally means Things + Places = Media. OK, but what content is appropriate for which things, where? This is where content strategists and marketers face new challenges. Will they create it? Aggregate it? Allow users to contribute it? What are the paramenters of the “what”? (How comes later).

2. How will user-generated content be considered and handled? It’s already easy for users to add layers of content to the sentient world. How will brands cope with virtual UGC? As with social media, brands face a lack of control in many aspects of the sentient world. AR is something consumers can do already. Smart devices such as keys have been hacked. Negative sentiment is inevitable. UGC will soon literally spill out of the web and into if not everything, then many things that will affect brands.

3. What data should or could be layered on your product, service or brand? What information, images, data and media should surround a carton of yogurt? A cinema box office? A hammer? What goes on the label, the package, and what constitutes an invisible but discoverable layer in the virtual world? Here, content strategy merges with merchandising, packaging, point of purchase and other marketing functions in a highly complex interchange not yet informed with best practices and cases studies.

4. What’s appropriate, in line with marketing and content strategy  and makes sense for the target audience? Currently, augmented reality is the dominant channel for marketing in the sentient world (though technology developments could shift this paradigm, and quickly). AR is opt-in. It requires a call-to-action to impel a consumer to whip out a device, fire up an app and experience the data layer. Will it be worth the effort? What’s the payoff? What’s the appropriate form of the call-to-action? More open questions that will only be resolved by extensive trial and error.

5. Data will be experienced in real-time. Do you have real-time ability? Real time marketing and advertising are becoming commonplace for many brands such as Pepsi and Applebee’s. Their marketers have always-on war rooms in which highly trained social media and analytics teams monitor digital sentiment and interaction 24/7, reacting and optimizing messaging in real time. The sentient world will rapidly become part of this intense, pressurized marketing function.

6. How will workflow be managed? Whose job is it to oversee these virtual layers of data? As with other forms of content marketing, clear roles haven’t yet emerged. The sentient world calls for developers, content creators, multimedia producers, strategist, creatives and more. Staffing, relationships with vendors and outside agencies and technology investments will all be affected – and require investment and ongoing budget.

7. What metrics will be applied to the sentient world? Interactions in the sentient world can be measured, but marketers have always had difficulty determining what to measure, particularly in new digital channels. Very little in this realm conforms to simple direct marketing metrics. Instead, more complex KPIs (key performance indicators) must be developed.

8. Who partners in this ecosystem? Who will brand align with to leverage the possibilities of this new ecosystem? If your refrigerator tells you it’s time to buy a fresh carton of milk, will the alert be accompanied by a coupon? When your car wants oil or fuel, will it recommend a preferred brand? Perhaps your phone will “know” there’s a nearby McDonalds where you can recharge – both the battery and yourself. Brands will soon explore newly-logical alliances.

9. What platforms matter now, and what must be accommodated in the future? A tough but persistent question in mobile has always been around platform. iPhone? iPad? Android, Blackberry, other tablets? What devices will consumers carry, and how will they use them to interact with places and objects? Yesterdays cameras, MP3 players and e-readers are consolidating into phones now. What will tomorrow bring – and how will you bring your data to that platform?

10. After the first wave of doing it because it’s cool, what’s next? As with all new technologies, the sentient world is a novelty now. Any reasonably serious brand initiative is almost guaranteed to have a novelty factor, PR amplification, buzz – the whole first-mover advantage package. More strategic brands will be asking themselves what comes next. How will we work, play, shop, travel and interact with the sentient world when it’s just another part of…the world?

 

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How Will DoubleClick Stack Up?

It almost had to happen. Ad stacks are proliferating across the digital media landscape, and corporate behemoths such as IBM and Adobe are refining and growing their suites of digital marketing and advertising software offerings. All the while, Google’s been very quiet on the display advertising front.

No longer. Today at DoubleClick Insights, Google announced its commitment to going full-bore into the stack wars with what Vice President, Display Advertising Neal Mohan described to me in an advance briefing is “the biggest upgrade in DoubleClick history.”

Everything digital advertising at Google: search, the Google Display Network, AdSense, text ads, rich media, YouTube, and mobile advertising (AdMob) will be integrated. A new brand encompassing all of DoubleClick’s platform technology has been created. The components include:

  • DoubleClick Digital Marketing Manager – an upgraded version of the DoubleClick ad server, the control panel for ad scheduling, delivery, reporting and more across premium media.
  • DoubleClick Bid Manager – a revamp of media buying platform Invite Media. Google promises faster processing and better reporting to manage audience buying across ad exchanges.
  • DoubleClick Search (launched last year) enables buying across multiple search engines.
  • DoubleClick Studio – a rich media solution that now incorporates Teracent.
  • Google Analytics integration.

“It’s a rolling thunder kind of rollout,” Mohan explained. Workflow, reporting and portfolio management components won’t be released for several weeks. “We invested very heavily in building out a unified stack instead of kluging together existing products.”

Mohan identifies three core benefits of turning all Google’s ad products into a unified stack (and DoubleClick is the platform used by most top agencies and advertisers). The first is “giving time back to our advertisers and agencies.”  In a typical week, Mohan estimates, up to two full days are spent in various digital platforms that don’t talk to each other. “By bringing all these pieces together we can save up to  six working weeks per person per year,” he claims.

Unified reporting and attribution is the second benefit. DoubleClick promises its suite will provide perspective and insights across campaigns and channels. How did display influence search, or vice versa?

Finally, Google says it’s offering cross-channel campaign optimization that will encompass bidding and campaign management.

How will Google’s stack differ from the other major players, notably Adobe and IBM? Most notably, DoubleClick includes an ad server – those two players don’t serve ads (AppNexus, however, does). Critically, the stack will maintain an open API to enable integrations of other software packages.

An open API is a desirable feature in any ad technology stack, but here it’s critical as (Google+ excepted), social support is something earmarked for an unspecified future date, not the present. Moreover, it’s hardly a secret that Google’s relationship with Twitter is tenuous, and with Facebook openly competitive. Both can be viewed as significant shortcomings in a truly integrated stack – though clearly no stack out there is all things to all advertisers.

Social isn’t Google’s only long-term goal. “Digital, whether on the search or display side, has been a result of performance marketing,” notes Mohan, “The brand opportunity still remains untapped.”

Smashing silos and making digital processes easier, more streamlined and unified is a good thing.  What remains to be seen is if the digital brand opportunity lies in display advertising, or in social channels including earned and owned media.

Image: DumboNYC.com

A version of this post also appears on iMedia Connection

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Facebook Advertising Can’t Succeed (without Marketing)

Perhaps GM’s ad unit needs more of a social life.

It’s hard to believe there wasn’t some sort of agenda in telling the Wall Street Journal, three days in advance of what’s slated to be the biggest IPO in U.S. history, that advertising on Facebook isn’t working for GM, but that’s what the automaker did. If the company was looking for attention, they certainly got it – the media were scrambling for new angles on the week’s biggest story.

Sure, it’s a big deal when one of the world’s largest advertiser pulls back $10M in spend (or makes such a public proclamation). Perspective is also warranted in this situation.

Facebook’s success as an advertising medium, or a public company for that matter, is far from guaranteed. Blazes of glory in this industry are often nasty, brutish and short (AOL, Yahoo, MySpace). But herewith, seven reasons to temper GM’s very public proclamation against Facebook’s advertising:

Facebook advertising isn’t even 1.0. It’s still beta Facebook is developing new advertising products, refining them, killing others, and tweaking some more.  The company’s IPO is a $100B bet that eventually, they’re going to get the model right, just as the search ad model was (and remains) very much in evolution when Google went public. For many advertisers advances can’t come fast enough, but the old term “new media” is very much in play in this contest.

Paid media can’t succeed without earned and owned integration Shortly after the GM story broke, rival Ford tweeted: “It’s all about the execution. Our Facebook ads are effective when strategically combined with engaging content & innovation.” Sounds simple, but integrating paid, owned and earned media into a viable, sustainable strategy in which each informs the other is hard. It requires silo-busting, new metrics, and an entirely new approach to media. Yet it’s a task marketers and advertisers must master – first in social media channels like Facebook, then across the rest of digital as well as traditional media.

Advertisers are only now testing the waters. “We believe that most advertisers are still learning and experimenting with the best ways to leverage Facebook to create more social and valuable ads,” Facebook says in its IPO filing. Best practices for advertising on social networks, or integrating that advertising with owned and earned media? Barely even embryonic. Like Facebook’s evolving ad platform, how to effectively advertise in social channels is still in the earliest stages of evolution

Facebook advertising is not about direct response Those ads on Facebook about tooth whitening and belly fat? Going, going gone says the company. Yet GM’s complaint was that its Facebook ads weren’t moving enough car sales, a pretty disingenuous argument.  GM is certainly sophisticated enough to know that advertising has many purposed other than direct sales: branding, consideration, and purchase intent for starters. It’s very hard to believe the company expected to sell X number of vehicles per Y Facebook ads.

Display is down across the board Why integrate paid, owned and earned media? Because fewer and fewer consumers engage with display advertising. It would be a lot simpler if that weren’t the case. Advertisers could plop creative into ad units and meet goals. But banner blindness and declining click trough rates call for more creative and integrated solutions – again, particularly in social environments.

Content Counts Even GM cedes to Facebook on this account. “We remain committed to an aggressive content strategy,” is one of several quotes GM made in the wake of its ‘no-advertising’ bombshell.

Facebook is biggest media company in history Ever. Of all time. Why doesn’t anyone ever state the obvious? No print or broadcast medium has ever even remotely approached a one billion user base. That old adage about advertising going where the eyeballs are? There are more eyeballs in the world focused on Facebook than anything else man-made. That’s a pretty compelling argument to get this advertising thing right – both internally at Facebook, as well as for advertisers and marketers.

Addendum: I’ve done quite a bit of talking to the media about this issue. Here’s a particularly insightful article from Venture Beat’s Jolie O’Dell: Why Facebook’s GM ad drama won’t impact this IPO.

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How Real Is Social Media Fatigue?

Facebook. Twitter. Google+. Pinterest. Foursquare. LinkedIn. Path.

How many of these social networks do you belong to? Do you participate in every day? Every week? Every month? When a new one comes along does your heart leap in anticipation, or sink a little when you realize it’s one more thing to add to your already burgeoning list of chores; one more series of tasks on an already too-long to-do list?

As pervasive as social media seems, it’s still early days and there have already been shakeouts. Some of us are old and hoary enough to remember Orkut, to once have thought we’d never be qualified to join Facebook because we’d already graduated from college, and to have believed that MySpace’s supremacy could never be called into question.

(please read the rest of this post over on MarketingLand)

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What’s Facebook Going to Do with All That Money?

Many of us grew up with Marcia, Marcia, Marcia. For the past few years the refrain has been Google, Google, Google. But this past week, it’s been all Facebook, all the time.

As we wait for the biggest IPO in tech history to shake out, the question I’m being asked most by clients and especially the mainstream media is, by far, “what’s Facebook going to do with all that money?”

I’d love it if “One Buck Zuck” would send me a check. Barring that, some reasonable conjectures can be drawn.

1). Mobile Facebook’s S-1 filing contained all the usual risk disclaimers: changing market conditions, loss of key executives, that stuff. But there was one zinger in the boilerplate – Facebook’s statement that mobile is growing fast, and that the company can’t yet monetize it. It’s not too much of a leap from there to the conclusion that multiple millions of dollars can be applied to figuring this one out. An article published the day after the filing suggests we’ll see the first Facebook mobile ads in March. Yet mobile means different things to different users, fast as the channel is growing. Smartphones, tablets…when it comes to mobile advertising, Facebook will require more than one solution. And that’s to say nothing of Facebook Credits and other commerce opportunities on mobile platforms. There’s plenty of R&D opportunity for Facebook across the mobile spectrum.

2). Data Data is Facebook’s core product. Not only do they have more of it every day on their users, that data is getting increasingly complex. In addition to basic demographic data, there’s friends and friends-of-friends. Groups they’re a part of, companies worked at, Likes, and soon, Actions, what they’re reading, listening to, eating and buying are only the beginning. Managing this data, parsing it, and making it useful and actionable to advertisers and marketers in ways that can help increase user engagement, create newer and more premium advertising products, extract deeper meaning and clarity from stores of data so complex it very nearly qualifies as big data is challenging, to say the least. It’s also critical to Facebook’s future. Data is what Facebook sells.

3). Platform What’s next for Facebook’s platform? It’s currently central to a vital Facebook economy. Without that platform, companies ranging from Zynga to Buddy Media would hardly exist as we know them today. Media companies from the Wall Street Journal to Spotfiy wouldn’t be able to reach and interact with Facebook users. It’s critical to keep that platform open and to continually expand upon its scope. Is social commerce the next comer? Features that link Facebook more deeply into the real world? Without the platform, Facebook doesn’t have the data, so watch for new developments in this arena, too.

4). Acquisitions Remember when Google was just a search engine? That was years ago, before YouTube, Blogger, Analytics and a host of other features that now seem integral to the company, but once upon a time were acquisitions. Google has largely become a roll-up, and Facebook could begin to follow that path as well (maybe by buying a search engine and finally incorporating real search into its platform?). Sure, Facebook’s made some small acquisitions in the past, but these are broadly viewed as more a bid to acquire talent, not technology. With a mind-boggling bank balance, that may well change.

5). Talent Silicon Valley engineers are high in demand, and you have to find a way to bring them to your company. In Facebook’s case, it’s not longer possible to do this with the lure of pre-IPO stock options. Facebook will soon be forced to pay a premium for new talent, particularly as some of an estimated 500 to 1,000 newly minted millionaires cash out. Sure, some will buy houses and cars. But others will yearn to get back to start-up culture. They’ll start new ventures, or even finance them. Facebook will pay more for talent in the long run, but their IPO will help to spark Silicon Valley’s economy, and that can only mean good things for innovation.

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Google’s New Privacy Policy Critical to Competition with Facebook

Google has a new, 360-degree privacy policy. Take that, Facebook. The consolidation of data that creates a unified customer profile across very nearly all of Google’s products and services creates a view of the customer that’s very, very Facebook in nature.

Funny that with all the attention directed to the Facebook IPO lately, so few commentators have made this observation.

It’s a good idea that has, understandably, creeped users out. The reality and the perception of privacy are miles apart in the mind of the public and notoriously difficult to change.

This move does make enormous sense for Google on three primary levels.

    1. Google’s stated reason for making a major change. It doesn’t make sense to have 70 different privacy policies. It does make sense to consolidate, and to simplify language. That’s good UX.
    2. Google is increasingly a media company. Its revenue comes from ad sales. These privacy policy changes will help it deliver not only better search results (let’s leave personalized search out of the equation for now), but better ads. It’s a major step closer to cracking the database of intentions. What’s a “Jaguar”? An “Apple”? “Bass”? The move really will help refine results.
    3. Google needs a 360 degree view of the customer now more than ever. Why? Because Facebook’s already got it. Or is at least a lot closer to having it than Google is if all Google’s information is separately warehoused. Facebook is currently better positioned than Google to “know” what videos you’re watching on YouTube (which Google owns!), and tie that data with what you’re reading in “The Wall Street Journal” or “The Washington Post,” or posting on Pinterest. With Facebook about to go public, Google needs to change that equation, and change it fast.

Privacy image: www.epic.org

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