- Reverse Engineering Facebook EdgeRank - Beyond the Theory - (by @baekdal)
Facebook EdgeRank has been a hot topic ever since it was created. Some defend it vigorously saying that it brings in added value, while others believe that it takes it away. Then we have the debate about promoting a post to make yourself more visible in people's newsfeeds, and the drop in reach for most brands.
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- The Shift from Single Consumption to Multi Consumption Behavior - (by @baekdal)
Whenever a study about tablet use comes out, we are almost always faced with something that is close to useless. The studies themselves are misleading, and the conclusions are based on a single consumption mode - encouraging you to miss the point.
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- The Pundits Versus The Analysts - (by @baekdal)
I'm reading Nate Silver's book: "The Signal and the Noise: Why So Many Predictions Fail-but Some Don't" ...and it's good.
One thing I really like is the differences between what he calls foxes and hedgehogs ... or analysts versus pundits. Both may have a preference or personal bias, but the analysts don't let that influence the data.
Take a look at this illustration from his book.
We see this with social media. Many social media pundits discharge reality, and instead attribute social behavior on what fits their personal preferences. For instance, a person who likes Pinterest will discard actual observations, and instead attribute your future success on a theory. And when that doesn't hold up to reality (like when a brand doesn't see a positive ROI), they attribute the failure to something else.
It's the difference between focusing on what people want to know, and what people need to know.
People want to know how to be able to create a successful brand page on Facebook in five easy steps. How something bad isn't really bad at all, that everything is fine, and to be confirmed in what they currently doing is also the right to do.
We see this a lot in the social world. In fact, people focusing on being hedgehogs are often far more popular, are shared more often, and is used more in the media than any others. Just look at all the articles promising social success using simple steps.
Foxes (analysts), however, take on a very different approach. They start out with the premises that nothing has been proven... yet.
One example was back in May when several of my readers asked me to write about Pinterest. As an analyst I couldn't just write an article highlighting the theory of what makes Pinterest work (like everyone else was doing) because I couldn't assume that Pinterest worked.
Instead I wrote "Should You Embrace Pinterest? For Brands and Publishers".
In this report, I don't talk about theory or how to do things simply. Instead, it starts out by observing the behavior of a Pinterest user, and explain how that impact brands and publishers in semi-probabilistic terms. And then, instead of telling you everything will be fine if you just do these 5 things, the report informs you about the pro and cons of the platform, how that affects you, and finally gives you a few tips proven to have a positive impact.
The problem is that articles like mine is not what the majority of people want. People want quick, easy, success ... and I give you probabilistic analysis that you have to stop to think about in relation to your brand.
See the dilemma? In order for me to provide you with more value, I have to make a trade-off in terms of traffic.
Nate Silver is illustrating to everyone just how big a difference there is between hedgehogs (pundits) and foxes (analysts). And he is proving that the pundits don't provide much value.
Yes, it's more complicated to follow an analyst, and yes you won't always just get the answer you want to hear. But the analysts are far better at predicting the future.
I think the greatest example of this is what happened over at Fox News on the night of the election. Karl Rove, a classic pundit, refused to look outside his own theories and personal bias, while Fox News' decision desk (all analysts) relied solely on qualified observations and probabilities.
It resulted in a showdown which Karl Rove lost badly. Just take a look at this video:
First Karl Rove disputed the data, and then (at 6:24) Megyn Kelly interviews the decision desk, who completely destroys Karl Rove's pundit analysis.
And after this listen to how Karl Rove is still not willing to change his views. Instead he is selectively picking out data that fits his biased. This is classic pundit behavior. As Nate Silver wrote: "Hedgehogs rarely hedge their predictions and are reluctant to change them."
And then take a look at this video recoded days after the election. Karl Rove still refuses to change his views, even when the result is clear to anyone.
You have to ask yourself what you want to be inspired by? Do you want to be inspired by people who tell you what you want to know (the pundits), or do you want to be inspired by people who tell you what you need to know (the analysts)?
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- Debunking the Effectiveness of Print Advertising - (by @baekdal)
Anyone who is working with digital media knows about the unfairness of how it is judged. On one hand we have the print people who are convinced that their catalogs, newspaper ads, and VIP club promotions all work splendidly despite the fact that they never measure it. On the other hand we have the highly measured digital world, where our click through rates are 0.1%, Facebook fan engagement rate is 5%, and shopping cart conversion rates are 2%...which are all pretty low numbers.
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- Duracell Just Keeps Going, Even During a Hurricane - (by @baekdal)
Yesterday I wrote about the failure of American Apparel and Gap as they tried to capitalize on the Hurricane Sandy. Each running various forms of advertising to promote their store. It was yet another example of how big companies are out of touch with what's going on around them. They only think of themselves and, in cases of a crisis, that kind of behavior can be truly damaging for your brand.
I wrote, "In case of a crisis, you focus on giving instead of taking." And I used the example of a coffee shop making free coffee for those hard at work cleaning up all the damage.
But It's easy to come up with ways small local businesses can help and have a lasting impact on their local communities. They are already there, and they are just as affected as anyone else. It's much harder for big corporations. The very culture of most corporations is that their marketing team is several steps away from the customers. As a big corporation, you only know what the customers wants because you hire expensive research firms to do a market study.
So when a big disaster like the Hurricane Sandy strikes. They have no clue as to what that actually means. We see this clearly when American Apparel advertised "If you are feeling bored by the storm, get 20% off for the next 36 hours" and then targeted it to the areas hit by the hurricane.
But people are not bored. People are scared about their future. They are hard at work repairing damage, removing fallen trees, pumping out water from their basements, and looking through their belongings to see how much can be saved. On top of that, varies resources, like petrol for their home generators are running out of fuel.
Frank Cho, the Cartoonist behind "Liberty Meadows" wrote:
Well, my worst fear came true during Hurricane Sandy. Two of the giant trees in my backyard fell on my house last night.
No one was hurt, although, the second tree came close to hitting the window near where we were sleeping in the basement. Now, we're surveying the damages and trying to figure out how to get the tree off the house with light machines since they can't get the giant crane truck into our yard.
It's gonna be a long week.
And on top of this, millions are without power. That's means, no computer, no smartphone, no iPad... no nothing. They are completely disconnected. They can't call their families to keep them up-to-date with what's going on. They can't check news sources online to see how things are in other places, they can't go online to see if the buses or trains are still running. The one thing that people value the most, the ability to connect, is gone.
And American Apparel asked them: "Are you feeling bored?"
You know why they did this? It's because American Apparel's office is located far away, and their marketing team has been reading the same news reports over and over again... and that's kind of boring. So if the marketing team is bored, so must everyone else... right?
Wrong ... and that's why they fail. They are simply too many steps away from their customers. And the result is a culture where the marketing team never thinks about anything outside their optimized market research studies.
But there are companies who do make a difference. Before and during the storm, Google stepped in with their excellent Hurricane tracker, and today, if you search anything related to Hurricane Sandy, Google is displaying links to all the information you need at the very top of the page.
But none of this is any good unless you can go online. As we all know, millions are without power. And this is where another huge company is stepping in to help. Duracell.
We all the know the ads. Duracell just keeps going and going and going. So in a case of a crisis, you keep people going. That's what Duracell does as a brand.
So Monday, they sent out their Rapid Responder Truck, bringing along a ton of batteries and recharging stations. As well as posting helpful guides on their Facebook page for how to help people extend the battery life of their devices.
Hey New York: You can find the Rapid Responder at Battery Place & West Street 'til 8pm, we'll be in New Jersey tomorrow to help folks recharge & reconnect. Check back for updates. #Sandy #PowerForward
But because of the size of this disaster, it quickly became apparent that one truck wasn't enough. So they are now sending out another much bigger truck, to help people charge their phones, and also with computers allowing people to go online and connect. Saying: We hear you and we know you need more help. We are on our way!
And just go to their Facebook page and read through the comments. They are more positive than anything you will find on any other brand page.
As I wrote yesterday: "In a crisis: You give!" ... and that's exactly what Duracell is doing ...and they do it every time. Here is a video from another storm:
Think of what you do best, and then go out to where people are and give it to them. What Google does best is organizing information, so that's what they are giving. Duracell is good at power, so that's what they do ...and their are both huge companies.
The difference between this and what American Apparel did, is that Duracal didn't turn to market research studies to figure out what people need. Duracell asked themselves, "If we were in this situation, how would I feel ... what would I need?" "And is there something in relation to what we do, that we can use to help?"
In the case of American Apparel, they could have provided blankets, or (cheap) wool gloves and hats. A cheap pair of wool gloves is just $0.2 per piece (when produced in bulk). That's cheaper than any advertising campaign.
They could have provided free wi-fi from all their stores. ... or they could just have done nothing, and that would have been okay too.
People will remember what you do, and why you do.
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- Rethink Government Subsidization of Media - (by @baekdal)
In many countries, there is a growing debate about how much (or how little) the Government should do to save newspapers. Here in Denmark (where I live) it's no exception. But it seems to me that they are all discussing the wrong thing.
In Denmark, the Government's media subsidization amounts to DKK 400 million (which would be roughly GBP 460 million in the UK, or USD 3.7 billion in the US, when we adjust for differences in population size).
On top of this, in Denmark we also have a similar system to the BBC television license in the UK, where every citizen has to pay a 'media' tax if you own any form of media (including a computer or tablet). The total media tax amounts to roughly DKK 5.7 billion (that's GBP 6.7 billion or USD 54 billion, adjusted for population sizes).
What this means is that every citizen above the age of 19 is forced to pay roughly $235 per year in taxes. Money that is then channeled into the media industry in the form of Government subsidizations.
That's a huge amount of money that the Danish Government is giving to the media industry.
So these days there is a debate going on about who should get the money. The way it works today is that the money is largely given to print newspapers above a certain size. In short, to all the old traditional newspapers.
But our Minister of Culture wants to change that. He is saying that the money should not be limited to print. He wants to change the rules so that it looks at production instead of how it is distributed. He also wants to lower the bar for who can get a share of money and use it to support the new innovative forms of media. Basically, he wants to use the Government's media subsidization to encourage change, rather than try to save the old.
What a brilliant guy!
Note: Read his essay. (Google translate)
Of course, it didn't take long for the opposing political parties to object to these radical ideas of encouraging change. The head of the Conservative party said that print newspapers are the lifeblood of the Conservative Party, that print is essential for democracy, and that "...for the Minister of Culture it is essential to help the new digital media forward, but the Conservative party will not accept a decline in subsidization for print".
What an old geezer!
Note: Read more here (in Danish).
Note: The scary part for me is that I have been a Conservative Party voter for most of my life... until today.
The problem here is that the debate is not about relevant things like the quality of journalism. It's all about what material it is on. That's just wrong. And the same debate is going in many other countries.
Focus on: Creating, Quality, Influence, and Long term
The subsidization of media is of course a relic from the past. It makes no sense to subsidize the media in an era of the internet. The politicians are saying that newspapers are important for democracy, because that was indeed their role in the disconnected world. But today, that role has been replaced by the connected world, in which everyone is a protector of democracy.
One good example of this is the case of SOPA/ACTA, in which the media failed to protect people's rights for democracy because they were just 'reporting'. It was instead up to the connected world to create a strong enough voice via many different channels, in order to force the politicians to change their support.
This is the world that we live in today. The 'connection' is now our protector of democracy (or whatever you want to call it). It makes no sense to subsidize only one form of media, whether it is print or digital.
Here is a simple example posted by nowthisnews:
In case of a crisis, what people need the most is not a newspaper. It's a connection.
The Government should stop giving money to the media and instead channel it into facilitating a connection. Meaning, instead of giving the money to traditional newspapers, channel the money into the infrastructure of the internet itself.
It would be much more beneficial for our society if our respective countries had high-speed, ever present internet. That would facilitate a better connection between people, and a stronger voice by the public.
It would also benefit the media. Having high-speed internet everywhere would lower the cost and facilitate a change in how we communicate and connect. Just look at the cost difference between the internet natives and the traditional press (when covering the same story).
It would also be more true to the very role of a Government. The role of a Government is to facilitate what we as individuals cannot do on our own. As individuals we can all report the news, but we cannot ensure a high-quality communication platform across the country.
For instance, back in 1927 it made a whole lot of sense for the UK Government to form the BBC. Back then, we lived in the disconnected world and it was important for the future success of the UK to make sure that their citizens were informed and up-to-speed about world events. Just look at the difference between North and South Korea as an example of what happens when you don't facilitate the availability of knowledge.
But we don't have this problem in 2012. The internet keeps everyone informed 24/7. For instance, I probably spent a couple of hours today watching the devastation of Hurricane Sandy, as well as talking with friends who live in the middle of its path.
Why give more than 5 billion to a few media companies, when you can spend it on giving every citizen cheap access to high-speed internet, wherever they are? An internet where they can connect with millions of news sources from both established and new media companies (as well as the growing number of social sources), facilitated by people who are where things happen.
We need to focus the money on the connection between sources and people, rather than on a few selected media companies.
Now, I don't expect this to happen. The media has a too firm a grip around the balls of every politician. We see this with how the leader of the Conservative Party tries to protect print, and we see it in many countries in Europe where the newspapers are trying to put a tax on digital media. Either by putting a tax on Google, or taxing our internet connections as proposed by The Guardian.
We are not actually moving forward at the moment.
But if we are to subsidize news, can we at least shift the debate to the work of the journalists? Think of it like this:
If you walk into any newsroom you will notice that every single journalist is writing their stories digitally. They are all sitting in front of their desktop or laptops ... some are even using their tablets.
Without realizing it, newspapers already have a digital-first workflow. They work digitally. They write their stories digitally. They take their pictures digitally, and they layout the page digitally.
That's digital first.
So when the media and most politicians say we should save print, they are actually saying: If you print out your article you get money from the Government, but if you post it digitally you don't.
That just makes no sense. Why is an article suddenly essential for our democracy if you print it out, but not if you post it online? It's the same article. This entire debate has been completely sidetracked.
Can we at least get back to debating the value of the journalistic profession, instead of focusing on what button the journalists push? Focus on what the journalists write. Support the creation of valuable content, and not what material it is outputted on.
Specifically, we need to focus the media subsidization on four criteria:
- Creating: Only news companies who create news should be subsidized. Newspapers who spend most of their time republishing other people's content, paraphrasing articles they find elsewhere, or bringing stories from Reuters or the AP should not be subsidized.
- Quality: Only quality news, as in newspapers focusing on in-depth investigative reporting, or stories that have a substantial level of value, should be subsidized. This is, of course, tricky because who determines what is valuable?
- Influence: Today only newsrooms of a certain size can get any money, but why is that? One great journalist can be ten times as influential as five mediocre ones. Focus the size of the subsidization on influence. This could then also be used to determine the quality mentioned above.
- Long term: Finally, think about subsidization from the perspective of the taxpayers. If I'm forced to pay $235 per year to 'save the media industry', it has to be worth saving. Failing newspapers should not receive any money unless they can come up with a convincing long term plan for how they intend to embrace the future.
Government subsidization should not be used to protect those who refuse to change. It should be an investment into the future success of our country. Just like building a new highway is an investment into the future of commerce.
Now, several newspaper executives are probably going to say that I'm wrong for a whole bunch a silly reasons. But here is the thing...
Advertising is unlikely to be the main source of income for newspapers in the future. We can all see the trends. Not only is print advertising in sharp decline, digital advertising is not going very well either. While the overall digital advertising market is growing (up 30+%), each individual publisher is making less.
The New York Times' digital advertising revenue dropped by 2.2%, and even Google saw a drop by 15% on a cost-per-click basis. What's happening here is that the long tail of the internet is outpacing the growth in digital advertising.
While digital advertising as a whole is growing, the number of publishers taking a piece of the pie is growing even faster. The result is a bigger market overall, but with less money for each media company.
In the future, publishers must find another primary source of income, and subscriptions is one of the obvious places to look.
How do you get people to subscribe? Well, you create unique content, of high-quality, which will influence people in their daily lives, over the long term.
What I'm proposing here is not just the whims of a digital native. We have to change the debate so that the solution is aligned with the future needs of the industry.
This is true regardless of your platform, and it's true regardless of whether your output is print or digital. This has nothing to do with the format. So let's refocus on solving the real problem.
Head over to G+ to comment and discuss this post. And remember to share it as well.
- Gap Tries to Use the Hurricane Sandy For Advertising - (by @baekdal)
We hear about it all the time. Something bad happens in the world, and brands try to capitalize on the heightened awareness of everyone to sell more products. It never works, and it always ends in tears.
Note: Also read the follow-up article where we look at how to do it right.
This time it is American Apparel and GAP, who is no stranger to social media backlashes. Just look at the ad below:
Keep in mind that this is a perfect time for American Apparel to have a sale. It's just before the holiday season, which means that a sale today will help clear the shop of the old collection and make more room for the new.
Gap also tweeted: "All Impacted by #sandy, stay safe. We will be doing a lot of Gap.com shopping today." With a link that encouraged people to check in at their New York store. Essentially saying, either come to our store, or, if you can't, go to our web shop and do a lot of shopping.
They still haven't learned from their logo disaster back in 2010.
Not surprisingly, the Twitterverse didn't take this kindly, and they are currently experiencing yet another social backlash.
So, when you shoot yourself in the foot like this what do you do? Well, Gap deleted the original tweet and instead posted this:
Yeah, right... As I wrote in my previous article about Gap, "Bang!! ...there goes another foot."
Here is what you do:
In case of a crisis, you focus on giving instead of taking. And no, giving people a discount is not 'giving', because you are still making money.
One example. If you own a coffee shop and you see people busily working to clean up after Sandy, you make a bunch of coffee, put it all on a cart, and go out to where people are working, offering it to them for free. Because that's what you do in a crisis. You help people the best you can, and as a coffee shop, your best is to make coffee.
And afterwards, people might remember that you gave and helped where you could. And just maybe that will result in a positive brand effect that will increase your revenue in the long term ... maybe!
But it is much better than focusing on a small increase in sale at the cost of a long term brand relationship... like Gap and American Apparel just did.
In a crisis: You give!
Also read the follow-up article where we look at how to do it right. And head over to G+ to comment and discuss this article.
- The Ins and Outs of Social Media at Enterprise Scale - (by @baekdal)
It seems like such a simple question how do you do social media at enterprise scale? How do you do it for a company with several thousand employees and with many different brands?
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