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December 2006, Week 2 Marketing Archives

Friday, December 15, 2006

Digital Music Leveling Off

Music downloads are selling well, but not as fast as before, and that is to be expected.

We've had conflicting reports about how Apple is doing with iTunes. First, Forrester said sales were down based on a very small sample, and then retreated a bit. Then, ComScore says iTunes sales are up 84 percent over last year.

Now we have Nielsen SoundScan saying digital music downloads of tracks for 2006 are up by more than 67 percent over last year, and digital album sales have more than doubled. On the downside, sales of individual tracks increased by 150 percent.

iPod sales have been strong, and people needed to fill their digital libraries with copies that they used to have on vinyl or cassette. Or, people bought individual tracks that were available as singles before. But soon much of those replacement purchases will be complete, so sales will increasingly rely on new music.

More people still purchase their music on CD, which probably makes music executives happy, but slowly more and more consumers will be like me and only buy digital tracks. It is so easy to make backup copies and mix and match your music that CDs are slowly becoming irrelevant except for the lyrics and album art.

So we can expect that digital music will slowly erode CD sales and continue to grow, but the days of triple digit growth are probably coming to an end.

Digital Music Leveling Off By John Gartner at 05:17 PM
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Psychologists Shrink Expertise to Podcasts

While I have said that the business opportunity of advertising within podcasts is probably not as big as some might hope, the format can be a good marketing vehicle for individuals or companies to showcase their expertise.

The Suffolk County Psychological Association is creating podcasts discussing mental health challenges, starting this week with the psychological effects of the holidays. Through the podcasts, the psychologists will provide a public service while (at least indirectly) promoting their practices.

Podcasts like this can be an effective method for consultants or others who are paid for their expertise to show that they know what they are talking about and gives an insight into their personality. This enables a level of familiarity that can attract an audience that isn't available through traditional media such as 45 second TV ad, print ad or billboard. Many people would like to "get to know" an expert somewhat before they contract with them, and sounding smart is a great way to do so.

Podcasting has its uses in marketing in effectively targeting specific interests, but just don't equate it with mass media.

Psychologists Shrink Expertise to Podcasts By John Gartner at 03:24 PM
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Mashable Passes TechCrunch in Subscribers

According to Feedburner has 4 times as many subscribers then our friends at TechCrunch. Ok, well they really didn't surpass them, I just wanted to give the TechCrunchers a scare. We've seen this before with the Feedburner issue showing 1 million subscribers on the Feedburner widget, and I assume like last time we will be hearing from our Feedburner friend Rick pretty soon.

This made me think about this question, Will anyone surpass TechCrunch, or will we have to wait till Web 3.0 for the new leader to step up?

Mashable Passes TechCrunch in Subscribers By Matt O'Hern at 02:02 PM
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Thursday, December 14, 2006

Venice Project to Invigorate Viral Videos

The new "it" app is coming. The Venice Project is predicted to revolutionize television advertising online and viral marketing. The Venice Project will slash the cost of streaming video online through a peer to peer network, and advertising against legitimate content is expected to pay for the service, according to E-Consultancy. The brains behind the idea worked on creating Kazaa and Skype, which has the blogosphere in titters and copyright holders curious. The company says it will encourage consumers to edit content such as TV shows and distribute it virally, all while being kind to the copyright holders who share in the loot from advertising. This has the potential to disrupt companies such as YouTube and Akamai that make a living hosting videos. The Venice Project also could be used by marketers so that their ads could be mashed up and enhanced with user generated content, as the auto companies and others have tested this year. Streaming video that is easy on the wallet and the bandwidth is very appealing, and the high profile people contributing to this project shows just how much money could be made by giving consumers a hand in content distribution and marketing messaging.

Venice Project to Invigorate Viral Videos By John Gartner at 03:00 PM
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Fortune 500 DIY Social Media Marketing

I'm noticing that there's two kinds of Fortune 500 social media marketing emerging.

There's the super slick eyeball buying money dump mania that surrounds buying the front page of myspace before the launch of, say, a movie such as XMen 3 or a major campaign like Coke's Wishcast or Southwest's Getaway.

Then there's the quiet, no frills kind of "by hand" YouTube presence demonstrated here by Nintendo's Wii.

After having heard Nintendo's George Harrison, SVP MarComm speak I know that he explores the less frilly approach. He himself has a MySpace profile (still hunting for it - he mentioned it at MPlanet) where he - gasp - interacts one on one with Nintendo customers.

Watch for a major shift towards the DIY by Fortune 500 agencies, especially by bold companies like Nintendo as they explore distribution and conversation through social media channels.

Fortune 500 DIY Social Media Marketing By Garrett at 01:59 PM
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Long Tail Should Wag Net Movies

Apple will soon be jumping into the movie download business, and I said in September, it probably won't help the company's stock much. With iTunes sales falling faster than Michael Richards' career, Apple's media division might be in for some tough times.

What Apple, and everyone else who is trying to sell movie downloads, should realize is that the only way to battle video stories and movies on demand is through better selection and pricing AND being able to watch movies on the TV.

With big screens selling like crazy, for most people watching a movie on their PC is lame by comparison. For movies that were released within the last six months, online movies will never best Blockbuster, and Netflix is even more convenient. But by focusing on the long tail of movies and making them shareable with the TV, online video stores could land a starring role. Blockbuster's stores have limted rack space that every day becomes dominated by fewer and fewer titles. But servers can host much more content at a lower cost, and that is the only way to beat the video store.

Like a reverse SlingBox, you should be able to watch any movie download on your TV through a wireless connection, or even download it straight to your DVR. While it is impractical for CinemaNow or Movielink to offer every movie, they could rotate through niche categories based on customer response. For example, ask customers if they would prefer to have access to every movie from John Huston, John Waters, Johnny Depp, or John Ford during the next month, and whoever gets the most votes wins.

Movies alone probably aren't enough of a sell, so any company needs to also corral YouTube videos and TV programs as well, which will be a challenge.

So which company is in the best position to dominate the downloads to TV market?

Time Warner: Through AOL, cable companies, and it's extensive TV and movie library, TW could focus many eyeballs on a video service.
Comcast: They have DVRs in millions of homes ready to accept content, but they would need to develop an Internet presence to expand beyond their current customers.
Apple: They have licensing agreements with content providers and know about streamlining RSS video and audio content, and have experience with home networking, but they would have to be more generous with their partners than they have been in the past.

Also in contention: Yahoo's media focused portal, and the aforementioned movie download services.

Long Tail Should Wag Net Movies By Jason Dowdell at 12:55 PM
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Sex Sells Search, Seriously.

Everyday in our lives we see a company pushing their product with a pretty lady and some cleavage. (read: GoDaddy. We are testosterone filled animals who can be influenced by any pretty girl and a low cut shirt. It is not hard to argue that sex sells for just about any product so why not search?

Microsoft is giving it a shot in its newest attempt at viral marketing. Her name is Ms. Dewey. She is the vixen behind, a site powered by Microsoft's Live Search whose purpose is to no doubt to attract all of us searchers sitting alone in our cubes hoping we will give Live Search a chance and entertain us at the same time.

The only downfall, and to no ones surprise, it doesn't work well in FireFox.

Queries that will bring an interesting response:
"Can you sing?"
"Can You Dance?"
"Do You drink?"
"Lets have a drink"
and any phrase that uses "Me", "Show", "Your" ...

any others?

Sex Sells Search, Seriously. By Jason Dowdell at 10:14 AM
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Wednesday, December 13, 2006

DVR Ads Go Personal With MSN

TiVo may not have to worry about the knock-off DVRs killing its chance for success -- Microsoft is emerging as a bigger threat.

The company just filed for a patent for tracking and customizing ads stored on digital video recorders, which in Microsoft's case today means Media Center PCs, according to Web Pro News. Microsoft prefers to license its technology to consumers electronics companies, so I would expect the company to encourage box builders to incorporate AdCenter technology for personalizing ads.

Different ads could be delivered depending on who recorded the program, which assumes that the same person is watching what was saved.

Advertising agencies could be in a conundrum under this scenario as they'd love to attract more advertisers by offering up relevant ads based on demographic information, but at the same time they wouldn't want to jeopardize the billions of dollars spent for car and political ads to blanket the airwaves.

With Microsoft looking over its shoulder, and Google probably not far behind, TiVo had better get its advertising pitch and tracking metrics down pat.

DVR Ads Go Personal With MSN By John Gartner at 01:20 PM
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Ads Not Keeping Up With Video

The watching of video online is growing much faster than video advertising, and it may be some time before the disconnect disappears.

Nearly 60 percent of Web users are regularly watching video content, but just 2.6 percent of ad dollars go to video, according to eMarketer data cited on MediaPost.

Video ads are being held back because advertisers and agencies are still learning how to price and track video ads. But the biggest reason for the disparity between video content and ad growth is that much of the video is user generated content that is either adult in nature and/or runs afoul of copyright laws, which scares off advertisers.

The YouTube et al content that is "legitimate," is limited in its ability to attract advertisers as only 42 percent of advertisers say they would be willing to buy against user generated video.

This is the same learning curve that advertisers have gone through before with bloggers. But just as professional publishers and advertisers now understand the value of blogs, so will "unprofessional" video be analyzed and tracked until enough of a history is established so that ad networks can justify their rates. Within a year the shakeout will have occurred and video ad selling and buying will be just as conventional as display or search ads. Then we'll start to see growth that approaches video watching.

Ads Not Keeping Up With Video By John Gartner at 01:14 PM
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Tuesday, December 12, 2006

TV Needs Affiliate Distribution

You've likely read some of the rampant rumors about the TV networks not named ABC considering a joint effort counter to YouTube. Only the threat of YouTube could get the networks to cooperate like this, but the individually they could compete better by making their content more available, taking a page from adult content providers.

YouTube has partially grown so popular because the company makes it easy to directly link to its videos and for people to display the videos on their own websites. Time Life gets it. The company is teaming with to make video clips from the just released Get Smart DVD series available to fans who would like to post them on their websites. (Brightcove is also hosting a hilarious spoof from National Lampoon that integrates Michael Richards' nightclub meltdown with clips from Seinfeld.)

This is a strategy that adult publishers have mastered in making clips of their stars available to affiliates to tempt their audience enough to purchase a DVD. The networks should employ this strategy and make clips available to fan sites which could serve as affiliates and provide an alternative to YouTube. For example, fans of Heroes could mash up their favorite clips of Hiro or Claire, all while promoting the show and driving traffic back to

Allowing fans to publish clips of popular shows will only increase interest in watching shows currently in production or buying DVDs of past episodes. Setting up an affiliate program so that fans can earn a buck in promoting DVD sales would put the content in the hands of the people who can do the most to promote a show.

TV Needs Affiliate Distribution By John Gartner at 10:02 AM
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Co-Shopping Socializes E-Commerce

For many people shopping is a social experience, allowing you to ooh and aah or make faces at your pal's intended purchase. That same "whaddayouthink?" sharing experience is being brought to the web by

The service enables two consumers to shop in parallel by displaying each person's browser window side by side, and allows consumers to save products on sale in a closet that can be shared with private or public groups. People can search to see who has purchased a product to get their input before whipping out your credit card.

Yahoo and Web-Ex have also gotten together so that browser windows can be shared through Yahoo's instant messenger client. This saves on sending each other links, and could also be used for co-shopping.

Getting the advice of trusted friends or current owners of a product is more important online since you are buying products sight unseen. Having user reviews such as on or Epinions is also helpful, but having friends or peers' sage advice is even more valuable. The retailers could get more traffic to their site by incorporating product reviews. They should offer incentives to people who fill out product reviews one month after the purchase, such as $5 off the next purchase. While reading 5 opinions is helpful, getting a consensus from 25 filters out the token extremely good or bad user experience.

I'm not so sure a lot of people will shop together online (then again the last time I asked a friend to go shopping with me was when I was in high school because I didn't have a car). But being able to search for recommendations and see what other people are buying could be beneficial. I would think that Google could aggregate the user reviews from across multiple services to differentiate Froogle from its competitors.

Co-Shopping Socializes E-Commerce By John Gartner at 09:12 AM
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Brian McCullough on the Mechanics of His Social Job Search Engine WhoToTalkTo

Brian McCullough, founded social job search engine WhoToTalkTo to "create an alternative job search that is qualitatively different from help wanted." He holds that the only innovation to the job search process thus far has been bringing help wanted onto the internet.

The brilliant peer to peer job network model was not his first attempt at revolutionizing job search though. In 2003 McCullough saw friendster.

"When I saw friendster all I thought about was job networking. Our first version tried to be the friendster of jobs, but I discovered that the social networking model doesn't work because not everyone's looking for a job at the same time. We had 15k signups but not everyone was incentivized to add jobs to the pot."

Incentivizing Job Lead Submissions
So how do you get people to add job leads to the pot when they may not be in immediate need of a job themselves? McCullough's major break through came when he asserted a basic hypothesis on his system - a job lead, to the people who need or want the job, is of equal value to any other job lead no matter how much it pays.

In other words a CEO position is an equal value exchange to a blog writing job so long as both seekers have need. This fundamental premise enabled the shift from a job social network to a job referral exchange.

Creating A Job Lead Community Economy
The mechanics of WhoToTalkTo were what first drew me to writing about it.

A first time user, in order to even "get in the door," has to submit a job lead to the index. This lead includes two parts - the description of the job and then the name of the person to contact, which remains hidden.

Once in, the user has earned one point, which he can use to request and, he hopes, purchase a job lead from someone in the network. The purchase is not automatic, and the person who submitted the job lead has the ultimate say in who he does or does not permit to see the lead.

Users earn points each time they "sell" their lead to another member, and they can use these points for future job lead purchases.

McCullough informed me that they're still testing models for maintaining the quality of the job leads in order to prevent crap leads from getting into the pool.

I asked him what about when WhoToTalkTo users start to sell the points they've earned and he told me they'd cross that bridge when they came to it.

The Business Model
So the content model attracted me first, but it was my questions about the seemingly non-existant business model that prompted me to shoot off my email to McCullough last night (he was quick to write me back and got on the phone right away).

McCullough's convinced that if they can create a tool that works for job seekers, "there are a million ways to monetize - we have 16000 categories - we can put up sponsorships for companies plus we can work with recruiters."

Three Weeks In
I get a little aggressive in interviews sometimes and McCullough had to remind me that they're only three weeks in.

"We built the model well enough so that we can grow to scale before we need more capital - our goal is to get the system working so that it's efficient for job seekers. And hey, we're three weeks in..."

In regards to growth plans he says, "we're going to work out of the midwest first. Since users are generating our content it's easier to go from regional to nationwide than to do it in reverse."

The results have been very exciting so far he told me, especially at the point where the value of the system gets tested - the sending of the job lead itself.

He told me that about 1/3 of job senders remain anonymous and pass along the name and address of the key contact person. Another third give their name - somewhat as a reference - along with the name of the main hiring contact. And the most surprising is that 1/3 of users have (indicated that they) hand delivered the name of the person directly to the person in charge of hiring.

Follow up Questions for McCullough
1) How do you ensure that job leads are actually passed on?
2) What do you think of LinkedIn? Clearly they've built a business around a job social network. What did they do right? Are they a competitor?
3) What if a given company's hiring manager joins WhoToTalkTo and my job lead is no longer valuable or necessary in your system?

Also see McCullough roll up his sleeves and converse with commenters in lifehacker.

Brian McCullough on the Mechanics of His Social Job Search Engine WhoToTalkTo By Garrett at 08:56 AM
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Monday, December 11, 2006

AOL Still Learning About Video

I saw a post on Adotas about AOL's new documentary movie channel called "True Stories" and wanted to check it out. Easier said then done as there isn't an easy path to finding the section on the

AOL's home page is a big mess with lots of prominence for advertising but no sense of order. If the company wants to turn its substantial media assets (through the relationship with parent Time Warner), AOL has to learn how to promote its content effectively. The current setup is a hodgepodge of text links for news and multimedia content, but it's scattered all over the page like a shot gun blast. Repetitive and confusing links, news on all corners of the page, what gives?

Anyway, after a half dozen clicks and a search on "True Stories" (as if most end users would have the stamina to do so), I finally found the documentary section. AOL is offering free views supported by ads and pay for downloads, depending on the features.

Previewing independent films online as way to build hype and get distribution will becoming increasingly common since the cost of entry is so low, and worth of mouth marketing online can be enough to have Hollywood calling. Now that the bandwidth is sufficient online, it makes sense for independent film makers to turn heads online rather than trying to fight with the megaplexes or elbowing out the other indies from the dying number small theaters. The Independent Film Channel will be streamed online to Verizon's IPTV customers, but a service available to all online could be a winner.

Direct-to-internet won't be a bad label to have. But for small movies to have big success, distributors should embrace the subscription model or introduce a few video ads during the stream.

AOL Still Learning About Video By John Gartner at 06:19 PM
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Making a Splash With User Content

Startup SplashCast wants to make enjoying Web 2.0 content as easy as turning on the TV. The Portland, OR, company is developing a Flash-based multimedia player to simplifying aggregating feeds of any type (podcast, vlog, photos, or RSS text) and presenting them on a website.

I haven't seen a demo yet, but from the description, SplashCast will create channels from publicly available feeds that can be hosted on any website. This sounds like a "My Yahoo" for multimedia feeds, allowing publishers or individual MySpace users to package the content that floats their boats.

The company hired away Marshall Kirkpatrick from TechCrunch to oversee content development, where he'll pick the best of the user generated content from around the Web.

It makes sense to create a multimedia version of an RSS aggregator that can tap the best of what's available since we don't just read news, blogs, or watch video. If SplashCast can bring it all together seamlessly while making it simple to discover new content, it could help publishers to gain exposure and increase the audience for multimedia.

Making a Splash With User Content By John Gartner at 02:11 PM
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Social Deal Sites: Distribution and Business Models

I was intrigued recently by in a recent write up by Neil Patel and started this post as a critique. Comments on that post indicated that is in a fairly crowded space so I decided to put them side by side for a nice half-baked Monday morning investigatory rant.

For this quickie, non-objective stream of consciousness survey I looked (by looked for some of these I mean I opened them up in FF tab and glanced at the layout) at boddit, dealplumber, trezr,, dealigg, and redflagdeals.

Yes, those are all the ones that appeared in comments. No I did not investigate deeply into the space to find more. Six is quite enough for this Monday morning ;)

Here's what I think about when analyzing a deal site:

well SEO'd pages (title tags, url optimization)
encourage links by members (strong sense of ownership and community, more content than coupon submission so members will start to link internally)
encourage sending deals to others
deal plugins for other sites (let site owners offer deals to their visitors - not viable for those suckling at the AdSense teat)

generating deal content on site
user submitted deals
deal feeds from other sites

making cash
AdSense (boo!!)
paid as content distributor (yay!)
paying others to distribute deals you get paid to distribute (yay yay yay!)

First off, Boddit barely fits in the social deal site category as far as I could tell. The only way that users can add content is in "reporting" to other users when a given deal is bullsh*t.

They feature feeds from approximately 11 deal sites (note to other deal sites - consider branching beyond user submitted if you haven't already ;).

Of today's compared sites they have gotten the most techerati attention from rags like Wired, Lifehacker and GigaOM which tells me they're based in the Valley or have good personal connections.

That and the fact that they seem to be proud of not making money with their service... they're trying to get bought or don't need money right now or are laying the ground work for CPC for when the online coupon space gets hot.

From an SEO perspective they don't seem concerned with distribution in the SERPs. Dumb.

And Boddit's the weakest when it comes to community.

Still, I think they have the potential for making the most money by getting paid by coupon distributors by the click or by the action. seems to be newer than Boddit and it's built on the Digg framework, apparently NOT on the Pligg platform (Dealigg IS built on Pligg).

What I like about is how they emphasize their community with profiles and by glorifying top deal submitters with front page attention.

But then there's the CrackSense... So now let me rant a bit on how AdSense is a lazy business model cop out.

CrackSense is Not a Business Model
Yes, you have to make money out of the gate and yes AdSense is a great way to do that.

But deal sites, I think you should be looking more to the Become.coms of the world for your business models. No, they don't have the social goodness of the Digg model. But they're making money through direct relationships with advertisers.

They do this by having developed out their CPC system so that those merchants submitting feeds can measure the value they're getting from Become.

My Suggested Alternative
Get your business development mojo working. Determine who in the coupon and deal space is actually making money right now. Figure out how you can help them with their distribution problem.

Call up Zixxo and figure out if there's a way you can distribute their coupons and take a cut.

And most importantly figure out how YOU can become the next AdSense by aggregating all the paying coupon and deal feeds and enabling others to get paid by distributing them for YOU.

Easier said than done, right? Of course. So that's my half-baked Monday morning rant for you and I'd love to hear more thoughts about deal sites, how they could/should/will be making money, and their natural evolution with local and social functionalities.

Other deal sites:

Google's Next AdSense Replacement:
google maps coupons (it will only get widespread distribution once they can start paying map builders to distribute them)

Social Deal Sites: Distribution and Business Models By Garrett at 10:09 AM
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« December 2006 Week 1 December 2006 Week 3 »

  • Week 1 (20 entries) December 1-9
  • Week 2 (15 entries) December 10-16
  • Week 3 (12 entries) December 17-23
  • Week 4 (8 entries) December 24-30
  • Week 5 (0 entries) December 31-31

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