The Twitter Machine: Keeping Hype Alive

Americans' Twitter usage isn't getting anywhere near Facebook'sI’ve blogged before about Twitter’s seeming inability to break out of its “niche” position in communications. We now have enough time under our belt with Twitter to begin to draw some conclusions rather than simply engage in speculation.

Endlessly hyped (although sometimes correctly labeled as a revolutionary communications tool – see the North African freedom movements) the fact is that Twitter hasn’t been adopted by the masses like we’ve witnessed with Facebook.

The Pew Research Center’s Internet & American Life Project estimates that fewer than 10% of American adults who are online are Twitter users. That equates to about 15 million Americans, which is vastly lower than Twitter’s own claims of ~65 million users.

But whether you choose to believe the 15 million or the 65 million figure, it’s a far cry from the 150+ million Americans who are on Facebook – which represents about half of the entire American population.

You can find a big reason for Pew’s discrepancy by snooping around on Twitter a bit. It won’t take you long to find countless Twitter accounts that are bereft of any tweet activity at all. People may have set their acount up at one time, but long ago lost interest in using the platform – if indeed they ever had any real Twitter zeal beyond “follow-the-leader.” (“Everybody’s going on Twitter … shouldn’t I sign up, too?”)

This is the purest essence of hype: generating a flurry of interest that quickly dissipates as the true value (or lack thereof) is discerned by users.

Of course, Twitter does have its place. Some brands find the platform to be a good venue for announcing new products and sales deals. And it doesn’t take long for the best of those deals promoted on Twitter to leech their way into the rest of the online world.

Other companies – although far fewer – are using Twitter as a kind of customer service discussion board.

And as we all know, celebrities l-o-v-e their Twitter accounts. What a great, easy way to generate an endless stream of sound-bite information about their favorite topic: themselves.

Analyses of active Twitter accounts have shown that a sizable chunk of the activity is made up of media properties and brands tweeting each other … a lot of inside-the-park baseball.

What’s missing from the equation is the level of “real people” engagement one can find on Facebook in abundance … and maybe soon on Google+ as well. That’s real social interaction – in spades.

Actually, you mightn’t be too far off the mark if you deduced that Twitter is the digital equivalent of a bunch of industry insiders at a cocktail party … saying little of real importance while trying to appear “impressive” and “hip” at the same time.

But who’s being fooled by that?

Shopping in the Internet Age: Let’s Make a Deal

Consumers love their online dealsI hear the complaint often that e-mail has become the preserve of “deal a day” promotions and communications from brands that have devolved into little more than breathless announcements about discounts that are “too good to pass up,” coupled with the obligatory “free shipping” pot-sweetener.

And then the next day, another deal shows up that’s practically the same as the last one …

But how surprising is this, really? Let’s not forget that daily newspaper advertising – the equivalent antecedent to e-mail marketing, has always had a similar focus on price, sales and deals.

It’s just that with e-mail, it seems more ubiquitous because they’re being pitched to us hourly on any number of digital platforms and mobile devices, rather than just once a day with the newspaper delivery.

And there’s no doubt that the sheer volume of deal activity is growing – the low cost of e-mail marketing makes sure of that. Not only is seemingly every consumer brand out there working the e-mail channel like they did catalogues and newspaper advertising in the past, there’s also the bevy of coupon marketers like LivingSocial, Groupon, Yipit and Gilt City, to name just the top few.

Some have discerned a decline in the “quality” of the information that is being provided; whereas there may have once been some educational, informative or “cool” content included along with the special deals, now it’s often devolved into nothing but “price, price, price” and “savings, savings, savings.”

The extent of consumer interaction with “deal-a-day” websites and e-mail offerings was quantified recently in consumer research conducted by Yahoo and Ipsos OTX MediaCT. The survey, fielded in February 2011, discovered that U.S. adults who are on the Internet subscribe to an average of three daily or weekly shopping e-mails or e-newsletters. (And more than half subscribe to two or more.)

How often are people reading these e-communiqués? With daily regularly, it turns out.

Nearly two-thirds of the respondents who subscribe to at least two of these “daily deal” e-mails or e-newsletters report that they read all of the messages that are sent. Here’s how reading frequency breaks out:

 Read several times per day: ~22% of respondents
 … Once per day: ~38%
 … A few times per week: ~23%

 Read once per week: ~7%
 … A few times per month: ~5%
 … Once per month or less: ~5%

The same Yahoo/Ipsos survey measured the degree of pass-along activity, which is one of the most potent aspects of e-mail marketing. Most recipients reported doing this – about 45% doing so on a weekly basis or more frequently:

 Forwarding deals to friends or family several times per week: ~17%
 … Several times per day: ~12%
 … Once per day: ~10%
 … Once per week: ~6%

 Forwarding once per month or less frequently: ~19%
 … Never doing so: ~22%

Despite the complaint commonly heard about groaning e-mail inboxes, the Yahoo/Ipsos survey gives little indication that consumers are in reality becoming all that tired of the onslaught of daily deal promos. In fact, over six in ten respondents in the survey reported that they subscribe to more of them today compared to last year.

Moreover, nearly half of the survey respondents reported that they’re excited to receive them … and that they “can’t wait” to see the latest deals being offered each time.

There’s another way we know that these deals are retaining their relevance: Three-fourths of the respondents reported that these types of e-mails come to their main inbox rather than to a separate account they’ve set up to receive such offers. So there’s little doubt that when people say that these deals are desirable, they actually mean it.

We consumers do like our deals, don’t we? And if you think that the popularity of deals and discounts is due to the recession, that’s belied by the fact that even America’s super-affluent are on the deal bandwagon. Unity Marketing’s recent survey of the wealthiest 2% of Americans — those earning $250,000+ per year — finds that value-priced Amazon is the top shopping destination for ~45% of them. Not only that, ~10% use Groupon for coupons and ~8% use Craigslist.

No, it seems bargain-hunting is the thing for practically everyone.

Online Display Ad Effectiveness: Skepticism Persists

Online Display AdvertisingAs the variety of options for online advertising have steadily increased over the years, the reputation of display advertising effectiveness has suffered. Part of this is in the statistics: abysmal clickthrough rates on many online display ads with percentages that trend toward the microscopic.

But another part is just plain intuition. People understand that when folks go online, they’re usually on a mission – whether it’s information-seeking, looking for products to purchase, or avocational pursuits.

Simply put, the “dynamic” is different than magazines, television or radio — although any advertiser will tell you that those media options also have their share of challenges in getting people to take notice and then to take action.

The perception that online display advertising is a “bad” investment when compared to search engine marketing is what’s given Google its stratospheric revenue growth and profits in recent years. And that makes sense; what better time to pop up on the screen than when someone has punched in a search term that relates to your product or service?

In the B-to-B field, the knock against display advertising is even stronger than in the consumer realm. In the business world, people have even less time or inclination to be distracted by advertising that could take them away from their mission at hand.

It doesn’t take a swath of eye-tracking studies to prove that most B-to-B practitioners have their blinders on to filter out extraneous “noise” when they’re in information-seeking mode.

This isn’t to say that B-to-B online display advertising isn’t occurring. In fact, in a new study titled Making Online Display Marketing Work for B2B, marketing research and consulting firm Forrester Research, Inc. reports that about seven in ten B-to-B interactive marketers employ online display advertising to some degree in their promotional programs.

And they do so for the same reasons that compelled these comparnies to advertise in print trade magazines in the past. According to the Forrester report, the primary objectives for online display advertising include:

 Increase brand awareness: ~49% of respondents
 Lead generation: ~46%
 Reaching key target audiences: ~46%
 Driving direct sales: ~41%

But here’s a major rub: Attitudes toward B-to-B online display advertising are pretty negative — and that definitely extends to the ad exchanges and ad networks serving the ads. Moreover, most don’t foresee any increased effectiveness in the coming years.

That may explain why Forrester found that fewer than 15% of the participants in its study reported that they have increased their online display advertising budgets in 2011 compared to 2010 – even as advertising budgets have trended upward overall.

When you look closer at display, there’s actually some interesting movement. Google has committed to a ~$390 million acquisition of display ad company Admeld. And regardless of the negative perceptions that may be out there, Google’s Ad Exchange and Yahoo’s Right Media platforms have created the ability for advertisers to bid on ad inventories based on their value to them.

Moreover, new capabilities make it easier to measure and attribute the impact of various media touchpoints — online display as well as others — that ultimately lead to conversion or sales.

But the negative perceptions about online display advertising continue, proving again that attitudes are hard to change — even in the quickly evolving world of digital advertising.

The European Union Versus Marketers

EU e-Privacy Initiative attacks ad tracking via cookiesI wonder how many marketers are focused on what’s happening in Europe on the digital marketing front? While companies here are busily engaged in making sure ad tracking is being done to the nth degree, in the UK and Continental Europe, new legal restrictions on advertising tracking threaten to upend a lot of these efforts, particularly for multinational brands.

In short, the EU’s e-Privacy Directive restricts the use of “cookies” and virtually all other digital ad tracking methods. And the legal frameworks set up around this directive would require any marketer with users in any EU country to be subject to EU-wide and country-specific privacy legislation.

The new privacy initiatives are far more restrictive than the present US-EU “safe harbor” agreement, which merely requires American companies to notify users when cookies are used on a website. The new regs covering web pages, web apps and mobile apps would require giving notice each time a cookie is used, thereby setting up a flurry of endless notifications that promises to seriously degrade the online browsing experience.

The seemingly reasonable compromise of adding information to a “terms of use” agreement isn’t acceptable to the EU either, unless all users are issued the new agreement and they certify their acceptance.

And just to make sure everyone knows how serious all of this is, the new regs call for the imposition of financial and/or criminal penalties for the non-compliant use of cookies. But for the moment at least, only two relatively small countries besides the UK – Estonia and Denmark – have implemented controls to enforce the EU directives.

Here in the United States, privacy legislation slowly wends its way around Congress, with many legislators understanding that the key to successful commerce online is the ability for marketers to match marketing messages to interested consumers. It’s in Europe where governments appear more than willing to cripple the ability of marketers to do the job they’ve sought to do for decades: Target their audiences with as much precision as possible.

As a result, some European businesses are making noises about abandoning Europe for the United States. The problem is, in the digital age with so much of the branding and commerce blurred between countries, it’s impossible for restrictive moves in one region not to cause negative repercussions somewhere else.

Challenging Popular Myths about Who Controls Household Spending

Who controls more consumer household spending ... women or men?
Who controls consumer household spending? Women ... men ... or both?
Among the “everyone knows” factoids in marketing, it’s accepted pretty much without question that women are the purchasing decision-makers in households far more than men. Whether it’s decisions on consumer spending or healthcare services … women are much more likely to be making those decisions compared to men.

And the figure commonly cited? Women are responsible for ~80% of the decisions. But how accurate is this … or is it time to reconsider this notion?

A survey conducted last year of ~4,000 Americans age 16 and older by The Futures Company, a London-based marketing consulting firm, found that ~37% of women claimed they have primary responsibility for shopping decisions in their household, while ~85% claimed they have primary or shared responsibility.

And the figures for the male respondents in this survey? Substantially the same, it turns out: 31% claimed they have primary shopping responsibility and 84% claimed that the responsibility is shared.

Emily Parenti, marketing director at Futures, concluded that the survey results “tell a different story” than the common perception of how much women control the purse-strings in households.

Indeed, the Futures survey is one of the first ones that actually goes so far as to quantify the issue. Ira Mayer, president of EPM Communications which publishes the newsletter Marketing to Women, has attempted to find the origin of the accepted 80% figure – but has come up empty.

“There is never any sourcing of the number,” Mayer says. And yet, “it’s become accepted folklore.”

When challenged to cite corroboration, students of marketing point to the book Marketing to Women, published in 2002 by Marti Barletta, wherein the claim is made that women “handle 80% to 90% of spending and purchasing for the household.”

And yet … Barletta has never been able to cite the source for this claim, either. Instead, she considers it “one of those rules-of-thumb numbers that everyone in the industry uses.”

Perhaps marketers need to take a look at this rule-of-thumb again. Because in addition to the Futures survey, a 2008 online research survey conducted by Boston Consulting Group asked women and men to estimate what percentage of household spending they influence or control.

True to form, the average answer given by women in the BCG survey was 73%. But the average answer given by men was 61%.

So in essence, both genders are claiming responsibility for a controlling or influence more than 50% of the spending in their household.

This points to a difference in perspective that likely won’t be going away anytime soon. Indeed, Marti Barletta still claims to be “pretty comfortable” with the 80% figure for female control over household spending. “Even being conservative, I wouldn’t go below 75%,” she asserts.

Whatever the correct figure actually is, one thing we can be certain of is that the notion of women having overwhelming control of household spending is off-base. And so, consumer product manufacturers would be wise to recalibrate their thinking as they engage in their product development and marketing activities and programs.

Outdoor advertising that’s really “out” there.

Adzookie House
Adding a lot of class to the neighborhood: Adzookie puts the "outré" in outdoor advertising.
There’s an interesting story that’s been swirling around the past few days about out-of-home advertising. Evidently, mobile ad network firm Adzookie is on the prowl for using someone’s house as an advertising placard.

As in “the entire house.” Or nearly all of it; Adzookie plans to place its logo, marketing messages and social media icons along with highly visible hues on every inch of surface save the rooftop, windows and awnings.

And what’s in it for the homeowner? Adzookie is claiming it will pay the mortgage on each house it selects for the honors.

Already, well over 1,000 applications from property owners have been received. The vast majority involve houses, but there are also restaurants, other businesses, and even a house of worship that have been submitted. You can click over to Adzookie’s Facebook page to view many of the pictures and pitches received.

How will Adzookie make its decision? Key, of course, will be traffic density; homes in sleepy sub-divisions or cul-de-sacs won’t have much of a chance. Then there’s also the issue of restrictive homeowner associations or the howls of protestation over “eye pollution” from nearby neighbors. That’ll knock quite a few more out of contention.

But here’s another tidbit that may turn out to be a deal-breaker for most of the remaining applications: CNNMoney magazine is reporting that Adzookie’s budget for the entire program is only ~$100,000 … and that includes the cost of painting the home(s) in question.

Even in this depressed real estate market, there aren’t too many houses that have a mortgage that low – unless you’re talking about a home in the City of Detroit, perhaps.

This capricious initiative proves yet again that in today’s world of advertising and promotion, pretty much anything goes. And if the idea is quirky enough, it’ll generate publicity in and of itself – thereby helping to bring about the desired awareness and interest even before the first slaps of the paintbrush ever hit the house.

Good going, Adzookie.

Click Wars Opening Round: Plaintiffs 1; Facebook 0

I’ve blogged before about the issue of click fraud, which has many companies wondering what portion of their pay-per-click campaigns are simply wasted effort.

Until now, Google has been the biggest target of blame … but now we’re seeing Facebook in the thick of it also.

It’s only been in the past year that Facebook has made a real run for the money when it comes to paid search advertising. There are some very positive aspects to Facebook’s advertising program, which can target where ads are served based on behavioral and psychographic factors from the Facebook profiles of members and their friend networks. This is something Google has had a difficult time emulating. (Not that they haven’t been trying … which is what the new Google +1 beta offering is all about.)

But now, Facebook is the target of a lawsuit from a number of advertisers who contend that there are major discrepancies between Facebook’s click volume and the companies’ own analytics programs which suggest that the purported clickthrough activity is significantly inflated.

As an example of one company that is a party to the lawsuit, sports fan site RootZoo alleges that on a single day in June 2010, its software programs reported ~300 clicks generated by Facebook … but Facebook charged RootZoo for ~800 clicks instead.

While contesting the allegations vigorously, Facebook’s attorneys have also argued against the company having to disclose the source code or other details of how it calculates clickthrough activity, citing fears that the proprietary information could be leaked to outside parties (competitors) as well.

But that argument fell on deaf ears this past week. Instead, Facebook has been ordered by the U.S. District Court in San Jose, CA to disclose a wide range of data, including its source code for systems to identify and filter out invalid clicks.

In making this decision, Magistrate Judge Howard Lloyd stated, “The source code in this case implemented Facebook’s desired filtering, and whether that filtering [has] lived up to Facebook’s claims and contractual obligations is the issue here.”

This ruling appears to call into question the sweeping terms and conditions that Facebook advertisers are required to sign before beginning a media program. The relevant language states: “I understand that third parties may generate impressions, clicks or other actions affecting the cost of the advertising for fraudulent or improper purposes, and I accept the risk of any such impressions, clicks or other actions.”

[This isn’t the only incidence of Facebook’s broad and restrictive stipulations; another particularly obnoxious one deals with “ownership” of content posted on Facebook pages – basically, the content creator gives up all rights of control — even if the content came to Facebook through a third-party source.]

But in this particular case, evidently the terms and conditions language isn’t sweeping enough, as Judge Lloyd ruled that the plaintiffs can sue on the basis of “invalid” clicks, if not “fraudulent” ones.

Touché! Score one for the judges against the lawyers!

Of course, it’s way too soon to know how this particular case is going to play out – or whether it’ll even get to court. It’s far more likely that Facebook will settle with the plaintiffs so as not to have to disclose its source code and other “trade secrets” — the very things that cause so many marketers to see paid search advertising as a gigantic black hole of mystery that is rigged against the advertisers no matter what.

But one thing is easy to predict: This won’t be the last time the issue of pay-per-click advertising is brought before the courts. Whether the target is Facebook, Google or Bing, these skirmishes are bound to be part of the business landscape for months and years to come.

E-mail early birds? The worm may be turning differently.

Best time to deploy marketing e-mail messages.One of the great benefits of the “online everything” world in which we now live is the ability to evaluate nearly anything about marketing not with hunches or speculation, but with hard data.

A perennial question is what time of day is best to deploy marketing e-mails to customers and prospects. The higher the propensity to open and read these messages, you’re closer to the goal of converting eyeballs to clickthroughs … and to sales.

ReachMail, a Chicago-based e-mail service provider, recently studied a large sampling (~650,000) of the millions of consumer and business marketing e-mail messages it sends out for clients daily in order to determine open rate differences based on the time of day. It normalized the data to account for different time zones.

What ReachMail found was that there are differing peak open rate times on weekends versus on weekdays:

 Weekdays: Peak e-mail open rates are between ~11:30 am and ~2:00 pm.

 Weekends: E-mail open rates begin trending upward at ~11:30 am, but don’t peak until ~4:00 pm.

John Murphy, ReachMail’s president, had this to say about people’s weekday e-mail open rate behaviors: “You would think it would spike in the morning, but they’re looking at work e-mails in the morning. Once they’ve cleared out their inbox, they’re looking at marketing e-mails in the afternoon.”

ReachMail’s conclusion: It’s best to deploy weekday e-mails between 10:00 am and Noon. For weekend e-mails, deploy them between Noon and 3:00 pm.

And this additional tidbit also: Don’t assume e-mails sent during the week will perform better than those deployed over the weekend. “People’s engagement rates are up there on the weekend,” Murphy maintains. “It’s our habit of checking e-mail all the time.”

He’s sure right about that.

A Green Fog

Green marketing hypeI’ve blogged before about evolving consumer attitudes on “green” products, and the telltale signs that “green fatigue” may be setting in with at least some people.

And now we have survey results that lend additional support to this observation. Harris Interactive conducted an online survey of ~2,350 U.S. adults in November, 2010 – one which is done annually by the polling firm. A comparison between the 2010 and 2009 survey results suggests that fewer Americans are engaging in various green behaviors in their daily lives.

While the year-on-year differences may be slight, the overall trend in participation is down. To illustrate, here are the comparative percentages of respondents who report that they “always” or “often” engage in certain “green” activities:

 Turning off lights when leaving a room: 81% (versus 83% in 2009)
 Making an effort to use less water: 57% (vs. 60%)
 Purchasing locally grown produce: 33% (vs. 39%)
 Purchasing locally manufactured products: 23% (vs. 26%)

Are there any areas where the trend is up rather than down? Actually, no. But Harris did find one area of stability: The same percentage of respondents in both years reported “always” or “often” engaging in recycling activities (68%).

What about other environmental activities? Again, the trend lines aren’t going in green’s favor:

 Purchased energy-efficient appliances (e.g., Energy Star): 30% (versus 36% in 2009)
 Donated or recycled electronic devices or parts: 32% (vs. 41%)
 Switched from bottled water to filtered tap water: 23% (vs. 29%)
 Purchased a more fuel-efficient car or hybrid vehicle: 8% (vs. 13%)

In fact, only one of the nearly 20 activities that were surveyed by Harris showed a positive “green” trend for 2010 versus the year prior — and that was switching to paperless statements for personal financial accounts.

Big whoop.

In trying to understand what is causing the change in behavior, it’s too simplistic to cite the economic recession. After all, 2010 was a less challenging year on that front compared to 2009, when the economy was really in the dumper.

For clues, we might turn to several other consumer research studies. The 2010 Green Gauge® Study conducted by GfK Roper gives us some possible reasons. That study concluded that there’s a sense of “green fatigue” among U.S. consumers. Clear majorities believe that green products are “too expensive” … while one–third of the people surveyed believe that green products “don’t work as well” as the alternatives.

But a more startling statistic from the GfK Roper study is that nearly 40% of the people surveyed feel that “green products aren’t really better for the environment.”

That shows a pretty skeptical public! And what about the issue of truth in advertising? The newest Green Gap Trend Tracker survey from Cone, just released this month, found that well over half of the ~1,035 adults surveyed do not trust the “green” claims made by products and brands.

Interestingly, even with so much of the consumer participation trending down rather than up, these surveys also found that more people today actually consider themselves to be environmentalists or green/environmentally aware.

So, consumers see themselves as green-friendly … but it’s all in how someone defines the term. As it turns out, it’s a murky definition that has people all over the map when it comes to the actual behavior.

Celebrity endorsements in advertising: All that glitters is not gold.

David Duchovny - Baume & Mercier Celebrity EndorsementWe love our celebrities, don’t we?

Christina Applegate takes motherhood … to celebrity status.

Zsa Zsa Gabor is a fabulous celebrity … and a panel of experts has been commissioned to find out why.

 His very existence … makes Prince William a celebrity.

Because the public goes so (Lady) gaga over celebrities, celebs have been used to hawk products and services for decades. Often, they can add pizzazz to what is otherwise a pretty routine advertising campaign. But how effective are the added glitz and glamour in ringing up additional sales?

I’ve long suspected that the value of celebrity endorsements might be over-hyped. Now we have some quantifiable proof. Ace Metrix, a California-based ad measurement firm, evaluated ~2,600 television ads shown during 2010. The company tested 263 unique national ads featuring celebrity endorsements, spanning 16 industries and 110 separate brands. All ads were tested within 48 hours of breaking nationally in order to capture immediate rather than “cultivated” ad effectiveness.

The celebrity ads were then evaluated against a control group of non-celeb ads in order to determine their comparative effectiveness in generating ad “lift” (better performance).

What the Ad Metrix analysis found was that only ~12% of the ads using celebrities showed more than 10% lift over average advertising norms in their respective industries. Even more startling, ~20% of the celebrity ads yielded 10% or worse (net negative) performance over the average advertising norms.

Here are some of the celebrities who had a “net negative” effect on their clients’ TV advertising effectiveness during 2010 – worst listed first:

Tiger Woods (Nike) – I guess this hardly comes as a surprise!
Lance Armstrong (Radio Shack)
Kenny Mayne (Gillette)
Dale Earnhardt, Jr. (Nationwide Auto Insurance)
Donald Trump (Macy’s)

Which celebrities managed to generate better-than-average scores? Queen of the heap is Oprah Winfrey for her 2010 spots for Liberty Mutual and Progressive Insurance. Ed Burns (iShares) and Carl Weathers (Bud Light) took the other top honors in positive lift.

Peter Daboll, head of Ace Metrix, had this to say about the findings: “This research proves unequivocally that, contrary to popular belief, the investment in a celebrity in TV advertising is rarely worthwhile. It is the advertising message that creates the connection to the viewer in areas such as relevance, information and attention, and this remains the most important driver of ad effectiveness.”

Interestingly, Oprah’s ads weren’t pitching products per se, but rather addressing current issue topics – in this case, warning against texting while driving. So one way to get through to the consumer via a celebrity is if the content is informational rather than a sales pitch.

But if the goal of the advertising is product sales, chances are the more the celebrity is truly “connected” to an advertiser’s product or service, the more successful he or she will be in engaging the target audience beyond simply the “curiosity factor.”

You can read detailed findings from the Ace Metrix analysis here.