First off, I rarely click online display ads. That said, I am interested in finding ways to make them more relevant. In principle, I would be willing to click on ads if they exceeded a certain relevance threshold. For the mass market, there is clearly an economy for these ads such and their price is theoretically governed in part by the revenue they generate inconjuction with supply and demand. In the last couple of years inventory has dramatically increased while click-through rates have fallen which has caused prices to fall precipitously. There are many reasons for this including desensitization to ads, stale page layouts, poor creative, poor content, and more ads overall. It’s also worth mentioning thatÂ I believe that the nature of the online ad market is not always rational and that many advertisers do not in fact generate revenue equal to their ad spend. But the purpose with this post is not to talk about how online ads are used for brand building or about irrational markets, but rather to shine a light on the different ways that ads are targeted and served to people online.
There are four main ways that online display advertisements are served, including context based, behavioral based, search/intent based, and social based. I’ll outline each of these below.
CONTEXT BASED: Contextual ads are placed based on information that the placement system gleans from the text of the website, and the keywords it contains, where the ad will be placed. Thus, the ad serverÂ places advertisements based on what the user is viewing. Following this, if you’re on a blog site that talks about educating children, the server might return ads for educational toys for children.
BEHAVIORAL BASED: Behavioral targeting uses information collected on an individual’s web-browsing behavior, such as the pages they have visited or the searches they have made, to select which advertisements to display to that individual. Most platforms identify visitors by assigning a unique id cookie to each and every visitor to the site thereby allowing them to be tracked throughout their web journey. Following this, if you visit an auto-insurance website then a site that makes car seats for children, the system might serve up ads for station wagons and SUVs.
SEARCH / INTENT BASED: Search/Intent targeting works by serving advertisements that are related to search terms or keywords. Following this, search engines can serve up ads that relate to your search query alongside the organic search engine results.
SOCIAL BASED: Social based ads are based on information found in your social graph. Following this, the ad server system will serve ads based on information found within the profiles of people within your network. In order for social ads to work, the ad server has to be serving ads within the social network or they must have permission to access this information from the outside.
The four serving approaches above can be combined to serve more relevant ads to people browsing online. It’s also important to note that these approaches are about serving ads, not about the kinds of ads (i.e. text, video, interactive). I mention this because there is a larger trend in the online display ad space around making ads more interactive and engaging. As the pendulum continues to swing in this direction we’ll see more “app-vertisements”, or branded experiences that are much more engaging that traditional ad units. I’ll talk about the evolution of online display ads in another post shortly.
This is a re-post of an article I wrote for Sprout Inc.
One of the distinguishing characteristics of MySpace, which no other social network has been able to replicate to date, is personalization. Personalizing a user profile on MySpace represents a desire that’s deeply woven into MySpace’s culture and community. This is one of the reasons that MySpace are different than Facebook users. True, there are MySpace users who have transitioned to Facebook as new features have been added to serve their needs, but personalization is a nut that Facebook has yet to fully crack. In this post, I’ll discuss why this is the case and how it’s about to change.
Personalization: MySpace vs. Facebook
Remember when MySpace was growing like Facebook is now? You’ll probably recall a profile page, for a friend or a band, that had a crazy background, flashing icons, music playing, and an overall chaotic user experience. While painful, especially when looking for a particular bit of information on the page, that chaos meant something important to the person who created it. However, to say it was like listening to jazz for the first time would be generous, because the chaos emerged from a lack of html standards on the site (i.e. users were free to use html poorly).
The structured experience on Facebook was very much a reaction to MySpace’s looseness. The drag and drop modular components offer some of the same features but lock into a page grid that resists personalization. No setting colors, backgrounds, embedding videos, music players, etc. That said, the standardization and rigidity have made the information on Facebook pages easy to find while supporting a consistent user experience.
When Facebook created the Static Facebook Markup Langauage (FBML) application a couple years ago, they acknowledged the limitations of their rigid structure and created a way for Facebook fan page administrators to personalize fan pages . Overnight it was possible to customize fan pages like MySpace profile pages, but users still needed to code using FBML. Combined with the fact that Facebook users were acclimated to the site’s rigidity, they didn’t exactly jump on the opportunity. And, it didn’t help that Facebook buried the application on their site.
Come Together Right Now
Different user experiences attracted different communities. The MySpace community has always been focused on entertainment and the Facebook community started on college campuses where socializing and networking were primary drivers. As the communities have grown and aged, however, feature sets have expanded and led to increasing diversity in each community and thus overlap between them.
As this has been unfolding, MySpace has been jockeying to protect their position as the leading community for entertainment, which is manifest in their strategic acquisition of iLike back in August. This was a key purchase because iLike’s Facebook music application was the first to gain real traction in the network. As such, it was a direct threat to MySpace’s ability to serve one of it’s core community segments, bands. A year earlier TechCrunch wrote about how music may be the single biggest factor keeping MySpace competitive. Apparently MySpace agrees, but acquiring iLike won’t stop the larger trend towards personalization because with personalization comes entertainment.
The one remaining barrier that’s stopping Facebook and MySpace users from creating personalized fan pages is FBML. The key to overcoming this barrier is a visual authoring tool that allows users to create rich, interactive, and engaging pages without writing a line of code. This is where visual authoring tools like Sprout Builder come in.
Visual authoring tools remove the technology barrier to personalization. Their drag and drop user interfaces are intuitive which makes them to learn, especially for designers or creatives who are already familiar with tools like Adobe’s Photoshop or Illustrator. While easy to use, these tools are surprisingly powerful, incorporating rss feeds, music players, slide shows, twitter feeds, etc. In fact, developers are switching to visual authoring tools because they are easier to use and much faster.
All Together Now
Because visual authoring tools export a .swf file (a Flash file), what you create can be embedded on any webpage. This means you can post a personalized Facebook fan page simply by copying and pasting the embed code into the Static FBML application (and soon, you’ll probably be able to post to Facebook with just a click). Plus, you can allow your fans to grab the embed code and share your creation on their profiles or fan pages as well. Another bonus of working with Sprout Builder is that no matter where or how many times your creation gets embedded, all the copies can be updated at once from inside the tool. In other words, you could embed your creation on your Facebook fan page AND your MySpace profile, allowing you to update them in both places at the same time and with one tool. While there are other services out there that can update your content across a variety of networks, such as Ping.fm, they won’t let you customize your entire personalized look and feel.
Sprout Builder also resolves the music/entertainment problem for Facebook because it allows bands to build personalized fan pages with music playlists, slideshows, videos and more. Hopefully, visual authoring tools will help bands reach out to their fan communities whether they are on MySpace, Facebook, or elsewhere. And for MySpace and Facebook, competing on something other than personalization should benefit all users.
Facebook & MySpace Demos
If you’re interested in learning how to place your Sprout Builder creation on your Fanpage, check out this demo video:
And if you’d like to get your creation on your MySpace profile, check out this demo:
For those who were unable to attend the NPR Think In, I’m including some of the artifacts that were produced during the event here.
Here is the presentation we built to provide background on NPR, define the five focus areas of the workshop, and structure the day:
The a video player below will allow you to play the presentations from the beginning of the day as well as the final presentation. In order to access this content, click on the “On Demand” button and then select either the “morning live broadcast” or the “afternoon live broadcast”
To understand NPR and it’s member stations, you have to understand the ecosystem they live in. The unique opportunities and challenges that NPR faces are very much embedded in this space which includes the NPR Foundation, the NPR board, the Corporation for Public Broadcasting (CPB), underwriters, independent producers, Public Radio International, American Public Media, and others. It’s a complex environment that is difficult to parse, which makes innovation challenging.
At the NPR Digital Think In, we’re trying to pull apart how the elements of the ecosystem work together as part of the process of envisioning the future. To this end, we’ve brought in an talented illustrator and creative director named Kevin White to help us understand the ecosystem better through images. The drawings below came out of a three step process that started with Kinsey Wilson and Vivian Schiller giving me an overview of the key relationships. I translated this information into a technical diagram to show the flows of money and programming content through the system. From there, Kevin came in to convert my technical diagram into a digestible illustration.
Here’s the technical drawing that we worked off of:
From here Kevin created two illustrations, one that was focused on the flow of programming content through the ecosystem, and one that was focused on how money moves through the system. The former shows how NPR produces seven main programming offerings and combines those with another 26 programs which it makes available for distribution to NPR member stations and their affiliates. It also shows how some of the member stations direct their own content back into the NPR system. Finally, it includes other content producers who add their content to the NPR member station mix.
The second illustration shows how money flows through the NPR system. Part of what we were trying to convey is the connection between finance and control. In this case, NPR is guided by a board whose majority is made of member station representatives (10 member station representatives, five citizens, and the CEO). Coincidentally, member stations provide the lion’s share of NPR funding, 46%.
The financial relationships that are in place create both constraints and opportunities for NPR and member stations. Perhaps the most obvious issue arises with the increase of digitally distributed content. Traditionally, NPR member stations displace content to solicit support. In a digital context, however, this is no longer feasible. Thus innovation, with respect to digital distribution, requires significant systemic change to preserve a revenue model that will sustain member stations. Obviously, until this can be achieved the member station representatives will not be motivated to bring NPR content towards a future of digital distribution. Thus the importance of understanding the complex relationships within the ecosystem.
We sincerely hope these illustrations help untangle the complexity and provide an opening for innovation.
Back in April, I had the pleasure of sitting down with Kinsey Wilson and Jennifer Dunworth from the NPR Foundation to discuss the role that digital media plays at NPR. They were on the west coast for an annual NPR retreat that I’d participated in the previous year. I was especially interested in reconnecting with the NPR team because there had been some significant leadership changes in the last year including the addition of Kinsey as the VP of Digital Media and Vivian Schiller as CEO.
To be completely candid, I found the vision for digital media that I’d been presented with a year earlier to be somewhat lackluster. So, when I spoke with Kinsey I was excited to hear a fresh approach, which I’ll outline below. My issue with the previous vision was that it didn’t seem to start with NPR listeners. The broad stokes suggested that NPR had to compete directly with CNN and required the production multi-media content on that scale. The vision was so big that it was hard to connect with an actual strategy. Plus, the innovation I was seeing on the small scale didn’t connect either. For example, NPR’s early mobile distribution foray included setting up phone numbers with dialing menus that mobile users could use to access content. It offered a poor user experience, inconsistent with the use case (try to use it while driving!), and costly (my minutes!). At the end of the day though, my real concern was that such a vision would take NPR away from it’s core competence, producing great audio content, rather than building on it and extending it.
The new team’s approach is completely different and starts from the understanding that NPR needs to not only listen to it’s community for cues about how and where to innovate, but also to the thought leaders at the intersection of media and technology. It just so happens that the latter are concentrated in the Bay Area, so I suggested creating an event at which we could explore NPR’s digital future with this community. This was the beginning of the NPR Digital Think In, which is now scheduled to take place at frog design in San Francisco on October 9th.
NPR is a unique news organization that really doesn’t have many direct comps in the marketplace. And, even if there were comps, they wouldn’t have the kind of listenership that NPR offers. Just to put things in perspective, consider that Morning Edition has more listeners than most of the leading commercial options in that slot. So, NPR has LOTS of listeners and is a mass market service provide. Part of what makes NPR unique, however, is their organizational structure, which includes the NPR Foundation and member stations. The way it works is that stations raise money with on air fundraisers and use some of that revenue to pay for NPR membership station status. The NPR Foundation uses that income to coordinate the stations and syndicate content across the network. The board of the foundation includes people from the member stations, which means that any innovation that the foundation supports cannot come into conflict with the memnber stations’ revenue source. Herein lies one of the key barriers to innovation. And, here’ an overview of the event:
Historic changes in technology and the rapid growth in digital media have had a profoundly disruptive effect on journalism, calling into question the news media’s ability to fulfill its time-honored function as civic watchdog. Hardly a week goes by that we don’t hear of yet another major news organization cutting staff, curtailing coverage or closing its doors. As traditional news organizations struggle to adapt, new, non-traditional outlets are beginning to take their place.
As a not-for-profit with a distinct business model, National Public Radio has benefited from the disruption and seen its audience grow. Americans now spend more time with NPR than any other news source. But it’s hardly immune from the technological challenges of the era. And it’s clear that the rise of digital media will ultimately disrupt NPR’s business model as well. NPR has responded by recruiting digital leaders to serve the top of the organization, embarking on an unprecedented staff training program and overhauling its digital media strategy. It is poised to take further steps to ensure it remains a vital source of news on every platform.
With the Digital Think In, NPR is inviting thought leaders across a variety of disciplines to help public media envision the next stage of a digital media strategy. Hosted and facilitated by frog design, this one-day interactive workshop will explore alternative business models, news gathering opportunities and distribution outlets, as well as develop scenarios for NPR’s digital future.
If you’re interested in learning more about the event feel free to visit the social network for the event online. On the day of the event, this network will be abuzz with ideas and we’ll be watching closely for your input. You can also create an account right now and start the conversation!