Insightful articles, opinion and commentary about mobile and web.

Reproduced from All things WOM:

Presenter said:
In kicking-off the Word of Mouth Marketing Association’s WOMM-U Conference, Geoff Donaker, chief operating officer at Yelp, said, “The Genie is out of the bottle. You’re better off joining the conversation, than not.” Conversations about local restaurants and businesses fuel Yelp’s business. Donaker described Yelp as, “local search powered by community.”

It is the online community that provides Yelp with over 6-million reviews of local restaurants and businesses. 21-million people last month used Yelp to decide which restaurant to visit, car mechanic to use, and spa to be pampered at. With its broad reach and deep reviews, Yelp is changing the game of small business marketing.

Donaker told the story of a local carpet cleaner who used to spend $100K on yellow page advertising. Thanks to all the new business generated by positive reviews on Yelp, this carpet cleaner no longer spends money on yellow page advertising. Instead, this business is spending much of its advertising budget on improving it’s customer service, resulting in more positive reviews on Yelp.

Donaker also discussed how businesses have a love/hate relationship with customer-driven reviews. Businesses love how great customer service is rewarded with positive reviews. However, they hate the loss of message control. That said, the positive to negative review ratio at Yelp stands at 6:1.

Audience tweeted:
@ErikNYC mentioned the beauty of Yelp’s customer-driven model is that “when the customer wins, the business wins.” Echoing sentiments from the presentation, @gamedayjreau tweeted, “It’s always about customer service at the end of the day.”

In response to a case study example of how negative reviews can become positive for businesses, @leslieforde commented, “It’s worth engaging vocal customers gently. Reaching out to angry customers can change negative perception.”

WOMMA says:
The love/hate relationship with customer-driven conversations is real. Word-of-mouth offline and online can not be controlled, only sparked. A business cannot ethically control what customers say about them. One of the best ways to spark word-of-mouth conversations is through delivering outstanding customer service and providing remarkable products.

For any business wanting to spark word-of-mouth conversations, it must first spend time and money to gain utmost confidence in their services and products. This confidence will give a business thick enough skin to withstand negative reviews as well as a solid foundation from which a virtuous cycle of positive reviews will fuel business growth.

Read the full article here.

Just come across this inspired quote on The Huffington Post from Steve Jobs:

“Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose. You are already naked. There is no reason not to follow your heart.”

It has to be one of the best commencement addresses, ever.

As discussed in our most recent podcast, the value of online ad networks is a hotly debated topic in the blogosphere.  Some recent work in this area includes:

• A recent report from Northwestern University’s Media Management Center in Chicago, which combines the resources of one of the US’ top MBA programs with its top-ranked journalism school. Online Ad Networks: Disruption – and Opportunity – for Media Businesses is aimed primarily at publishers, but has lots of good general info about the value of online ad networks.

“A thousand online ad impressions could be worth 50 cents – or they could be worth 50 dollars. For a publisher, the difference may well lie in how well you manage your relationship with advertising networks.”

• Former Wired editor and author of  The Search John Batelle asks the question, “What’s this fascination with ad networks? “ He writes:

“How do we truly create value in the media business? Do we sell inventory to the highest bidder via algorithms, automated processes, and platforms? Or do we partner with marketers and creators of media to build brands - both media brands, and consumer marketing brands? …. It seems the future, according to AOL, Yahoo, and Microsoft, is in ad networks.”

Also, here are a couple of places to learn more about the effectiveness of online advertising in general:

• This case study looks at how the retailer Target measured the ROI of online advertising spend impact on offline sales: http://www.microsoft.com/casestudies/casestudy.aspx?casestudyid=4000001057 . Interesting quote from the study:

“Given the strong ROI impact and the favorable cost efficiency of Target’s online campaign, the recommended percentage of online spend should be 10 percent of the total advertising budget.”

• Here’s a good list of studies on measuring Internet advertising effectiveness and organisations working in this area, compiled by the Web Center for Social Research Methods:  http://www.socialresearchmethods.net/Gallery/Cho2/measure1.htm

Online ad networks offer advertisers and agencies a host of options for getting their message out to a wide audience. If you’re looking for to learn more than what we’ve been talking about this month, here are a few places you can go for in-depth info about ad networks:

• New York-based digital media investment bank De Silva and Phillips has produced a white paper called “Online Ad Networks: Monetizing the Long Tail.”

• The Interactive Advertising Networks of Australia: formed specifically to develop, promote and advance Australian interactive advertising networks, publishes locally-based information about online ad networks.

• The DigiWrite blog has an informative primer on ad networks, pointing out that “ad networks to not compete with agencies. We work with many agencies to make their lives easier.”

• The Lies, Damned Lies blog offers a very comprehensive explanation of how ad networks work, including plenty of diagrams for the visually-oriented.

Online ad networks need to change to survive future digital audiences

Are online advertising networks a good thing or a bad thing? It depends on who you talk to. Many experts say ad networks help large portals and small sites alike unload excess inventory, while others say the rates paid on ad networks are so low they are killing the industry.

Some people are particularly passionate in their views. David Koretz, CEO of collaboration software company Blue Tie, says that “ad networks are for idiots”. He calls them “a tax on lazy publishers. They are a cancer that slowly eats away at you from the inside, doing severe damage even though you feel fine. They are a cancer that has spread to nearly every publisher, and threaten to do irreversible damage to our industry.”

The problem, he says, is that, “We are slaves to the short-term need to make the quarter; addicts who take the revenue boost despite the pain we will endure later.”

Working under the assumption that the average premium publisher only sells 30% of its inventory direct (which is backed up by research), he accuses publishers of using ‘bad math’ to fill the other 70 per cent.

“If a publisher sells the entire 70% of remnant inventory through ad networks, that is equivalent to selling 0.93% more inventory direct. Less than 1%!” He recommends instead that they “Figure out how to sell an incremental 0.93% as premium by innovating, not by betting the farm.”

Koretz is specifically referring to blind networks. Blind ad networks offer low pricing to direct marketers in exchange for those marketers relinquishing control over where their ads will run. Rock bottom prices (CPMs – costs per thousand page views – are measured in cents rather than dollars) are achieved through large bulk buys of typically remnant inventory combined with campaign optimization and ad targeting technology.

In a blind advertising network, advertisers get either limited or no information about what webpage their ad is shown on and where on the page it is shown. While advertisers save substantial sums of money, it’s practically impossible to measure ad effectiveness.

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Simon van Wyk talks to Australian online advertising expert David Holmes, managing director of APAC Digital, about the present and the future of ad networks and exchanges. David says that despite the increasing use of technology to achieve targeting goals, “Using salespeople adds value to the process of selling online advertising.” He talks to Simon about the difference between difference kinds of ad networks and defines common but confusing acronyms. Listen to the podcast below.

 

 HotHouse Podcast: David Holmes [33:23m]: Play Now | Play in Popup | Download