While the web may have its manic sights set on the the Facebook IPO, I found that I was more interested in a piece of industry news that came out the other day.

Business Insider ran a piece about marketing giant Proctor and Gamble’s plans to shift its advertising strategy in a major way:

“P&G said it would lay off 1,600 staffers, including marketers, as part of a cost-cutting exercise. More interestingly, CEO Robert McDonald finally seems to have woken up to the fact that he cannot keep increasing P&G’s ad budget forever, regardless of what happens to its sales.

He told Wall Street analysts that he would have to “moderate” his ad budget because Facebook and Google can be “more efficient” than the traditional media that usually eats the lion’s share of P&G’s ad budget….

McDonald eventually said:

As we’ve said historically, the 9% to 11% range [for advertising as a percentage of sales] has been what we have spent. Actually, I believe that over time, we will see the increase in the cost of advertising moderate. There are just so many different media available today and we’re quickly moving more and more of our businesses into digital. And in that space, there are lots of different avenues available.

In the digital space, with things like Facebook and Google and others, we find that the return on investment of the advertising, when properly designed, when the big idea is there, can be much more efficient. One example is our Old Spice campaign, where we had 1.8 billion free impressions and there are many other examples I can cite from all over the world. So while there may be pressure on advertising, particularly in the United States, for example, during the year of a presidential election, there are mitigating factors like the plethora of media available.

While it’s extremely sad that P&G’s strategic move will result in 1,600 layoffs, it’s a direct consequence of P&G sticking to its traditional ad media guns for so long.

It speaks to something I’ve been harping on for over two years.  Back in November 2010 I in my DDG blog post titled “Making the Business case for Social- a CMO perspective,” in which I lamented the double standard that faced the digital world when it came down to how big brands spent their advertising dollars.

With P&G’s acknowledgement that digital and social ad spends are more efficient drivers of engagement, the marketing giant now has an excuse to simultaneously rein in its overall spending while increasing its spending in digital arenas.

I guess it’s natural for there to be a lag between the pervasive adoption of emerging media platforms and ad dollars, but to me it has been a glaring arbitrage opportunity for some time.

Does it mean that traditional media is dead?  No, I don’t think so. But brands need to readjust their distribution of ad spend so that the focus is on channels that engage audiences efficiently. The ever-increasing sophistication of digital marketing tools has given brands the ability to reach their audiences, interact with them, and track their behavior all the way to conversion- all in a cheaper package than traditional advertising channels ever could. I guarantee you this won’t be the last big company that readjusts its distributions in ad spend to more representative levels.

Do you work for a Fortune 500 brand?  have you seen the beginnings of this shift in your own company?  What are some glaring examples of other brands that need to shift their advertising dollars towards digital?

 The big buzzword for 2012 seems to be “Social curation.”

Social curation is a concept in which users are empowered to present their own content in a simplified, organized way, to social circles, enabling engagement and viral sharing across digital platforms.

The most fitting example of social curation has manifested itself in a site called Pinterest. For those who are unfamiliar, it is a virtual pinboard that lets its users organize and share visual content that they’ve found online.  it looks like this:

 

 

I’ve been spending some time on Pinterest, getting to know the platform and seeing how actively it is being adopted by my peers. It’s become a popular portal for fashionistas, foodies, and home decorators.  How popular?  Check out Pinterest’s recent metrics (Via Hitwise):

 

11 Million visits During the week of December 10th- a 40 fold increase from 6 months ago. It’s now on the top 10 list of visited social sites that Hitwise tracks.

So what’s so significant about Pinterest? While it might seem like a pretty simple concept, at a structural level it’s a significant evolution in how social groups share and curate content. Pinterest is the latest digital tool that enables the masses to curate content in a simple, meaningful way. Its overt simplification of a structured visual set is something that caught the eye of Elad Blog:

“2010-Now Structured Sets And Social Curation. Pinterest (launch 2010) was one of the first sites to take push button content generation (via bookmarklets and “re-pinning”) and structure it into sets of curated content called “boards”.  This allowed users to collect content from across the web, as well as from other users on the site.  In some sense it took what a site like Tumblr had been doing but transformed blog-like streams into structured, curated collections users could share.  Importantly, it was easy for new users to consume these sets of content visually as structured sets, and to share these sets with others.

David King has pointed out an interesting insight – by constructing content in a structured set versus a stream, sites such as Pinterest and Snip, it has prevented stream-based sites such as Facebook from becoming a compelling place to consume Pinterest or Snip. It’s content (which contrasts with e.g. Instagram or other stream based sites).”

As demonstrated in the chart above, Pinterest iterates on existing content platforms by simplifing it even further.  I would also contend that you could replace the X axis with “Engagement.” Liking, commenting, and reposting on Pinterest is just as easy as pinning something, and the two go hand in hand.

So what now?  Where is social curation going to go? How is it going to evolve further?

Social curation is a shining example of how emerging digital platforms are now focusing on “Discovery.” Discovery, simply put, is the next iteration of search. Instead of an engine that finds exactly what you’re are looking for, discovery platforms focus on providing you with content that is tailored via social curation, geo-localization,past behavior and history.  Google’s acquisition of Zagat is a great example of how the big search engine is evolving in that general direction.

By facilitating the submission of interesting content and democratizing its popularity via engagement mechanics, we are able to freely share what we like with ease. It’s digital peer-to-peer contact at its purest.

It doesn’t end there, though.  As discovery platforms evolve, the next step is to integrate and enable transactions on these discovery platforms.  For example, while photos can link directly to online product pages, I envision Pinterest developing a more universal, integrated e-commerce platform internally. Some brands have already been at work integrating Social curation with e-commerce.  As my friend Zach points out, Fab.com has already been at it by building a community with their “Live feed.”  You can bank on other brands jumping in and putting their own spin on Socially curated content sets.

The future of social discovery and e-commerce looks easier, prettier, and more integrated- I can’t wait.

Earlier this week you may have read about the Patent infringement case between Apple and HTC that has currently resulted in certain HTC/Android phones being banned for sale in the United States.   Being a bit of an Androidophile, I was understandably miffed.

The patent infringement, stemming around data recognition, involves a feature in which the phone recognizes a telephone number so it can be stored in directories or called without dialing.

Apple’s underlying motivation for this move is quite obvious:

“The fight can be traced back to a decision by Jobs in March 2010 to file the HTC case, the first patent complaint by a device maker targeting Google’s Android operating system. Jobs, who died Oct. 5, made it his mission “to destroy Android,” which he said “ripped off the iPhone, wholesale,” according to Walter Isaacson’s biography of the Apple founder.” -via Bloomberg

This recent going-on got me thinking about how patent law has evolved (or devolved) within the confines of our country’s capitalistic framework.  Patent law, which is supposed to protect the interests of innovators and inventors, should be have a bolstering, accelerative effect on technological and economic development.

But the more I see and hear about the myriad patent infringement cases that all of these companies are embroiled in, the more I think that it has the opposite effect.

Last August, Reuters published a graphic that visualized all a veritable “who’s suing who” in the tech world:

There you have it:  Apple certainly isn’t the only one suing.   Collectively, these companies are probably spending tens of millions for lawyers, all in the name of disrupting competition. I was having a hard time correctly verbalizing my issues with how these companies leverage copyright law, but it comes down to this:

Our country’s current iteration of patent law undermines the ethos of antitrust law. Blocking others from building on a technological process innovation lays a red carpet out for monopolistic situations.

Is it wrong to allow companies to “copy” or further develop ideas that weren’t their own?

I’m reminded of something my high school art teacher said to me over ten years ago:

“Art isn’t created in a vacuum.”

I think the same holds true in technology.  Almost everything in art and tech is derivative.  They are by their very nature evolutionary constructs.  To restrict this growth in the name of hoarding an idea is counterproductive and damaging to technological progress in general.

If any one of these companies had its way and was able to block all the technology it claimed as its own, it would be effectively be operating as a monopoly player in the cell phone market.

I wonder if this motivation goes beyond greed.  Are all of these companies scared and paranoid of the others one-upping their initial innovations?

The thing is, this back-and-forth one-upping is a core component of working within a capitalistic construct,  it’s also the main accelerant of technological innovation.

Without it, the needs of the public are overshadowed by tech companies who act monopolistically.  Without the catalyst of competition, the rate of new innovation is bound to slow down. I wish all of the tech players would stop suing each other over technology patents and instead concentrate on creating the best products and innovations with them. Let the marketplace determine who the true innovators are, not the courts.  If you’re worried about not coming out on top, then your product doesn’t withstand its ultimate litmus test- the marketplace.

The writers at Gizmodo said it best in today’s post:

“I’m all for seeing Apple defend its intellectual property. But Android is a healthy force in the marketplace. If Apple can destroy it there, more power to Tim Cook and company. But if Apple beats Android in the courts rather than the marketplace—if it out-segs Google instead of out-innovating it—that may be great for Apple, but it will be bad for society, bad for technology, and ultimately bad for Apple.

And of course, the great irony is that so much of the amazing innovation that Apple pulled off over the past three decades can be traced back to its willingness to swipe ideas from Xerox. Steve jobs was fond of quoting Picasso, saying “good artists copy, great artists steal.” If Apple does succeed in crushing Android in the courts, where will it get its next great idea? My guess is that it won’t come from a lawyer.”

As 2011 rounds the final corner, I find myself looking back on the year. To say that much went on is a bit of an understatement.  What really grabbed my attention about this year, however, was the paradigm shift around brand marketing.

Most companies have approached today’s emerging digital platforms in a traditional trickle-down model: Invest in celebrity/spokesperson, pump tons of money into branding and ads, and then track awareness and purchase behavior.

While that model may have been an effective template for more traditional media platforms, it’s an ineffective approach to today’s digital environment.

The Jaded User

The digital landscape has reached a critical mass in vie-ing  for users’ attention. Today’s digitally-enabled consumer is under a constant barrage of marketing content during every waking moment.  They’ve become adept and mentally blocking out the countless ads they see during any given browsing experience. The quality of the content they’re exposed to is a contributing factor.  Most ads and marketing campaigns are glorified, narcissistic product shilling.Rightfully so, these users are jaded when it comes to branded marketing content.  In fact,

• 72% of internet users say they are exposed to too many brand communications.*
• 4% of online consumers account for 80% of influential impressions*
• Consumers distrust brands 3.5 times more than people they know.*

Brands have had a hard time adapting to this behavioral change. The diminished effectiveness of traditional ad impressions has forced them to push for a more organic approach to maximizing user engagement.

Thought Leadership is the Cornerstone

Companies that have transformed themselves into thought leaders within their industry are largely able to counter the effect of faltering branded marketing.  What does it entail?

Brands need to position themselves (or at least part of it) as contributing experts in the industry/field of business that they are a part of.  Creating content that showcases expertise, educates users, and fosters discussion is at the core of thought leadership.

How is the brand innovating? Is it truly committed to teaching its audience and contributing to the development of the industry? How is it using its products and services in the real world?  Brands that invest in cultivating thought leadership will find that doing so enhances their level of influence in the public space. The content created needs to focus on furthering the subject as opposed to a more direct sales-enablement approach. Contextually influential brands are more likely to have their content shared by their audience.

Now, a few caveats:

• Not every brand/company can be a thought leader.
• Leveraging thought leadership in marketing campaigns assumes that the brand has expertise in the respective field.
• The content needs to be engaging:  Create focused stories and programs that inspire passionate, relevant groups

If you’re looking for a few examples of brands that excel as thought leaders, here are three:

• IBM’s Smarter Planet
• Stumptown Coffee
• OKCupid

While IBM, Stumptown Coffee, and OKCupid are seemingly different in almost every way, their common link is that they invest in creating content derived from their industry expertise.  Whether a technology giant or a boutique coffee roaster, thought leadership is a powerful tool that allows for these brands to be influential to their own unique audiences.  These brands have validated themselves as industry experts and paragons through their creation and sharing of content. Their commitment to thought leadership acts as a catalyst for influence, audience, and traffic growth.

These brands also use their content to foster action, engagement and sharing in their own ways.  Smarter planet’s campaign enables users to share the content and fosters discussion.  Users can even take part in Smarterplanet campaigns by donating a portion of their computer’s cpu time towards research. Stumptown’s website features an informative guide on various coffee preparation methods, educating and enabling customers to fully appreciate their product.  OKCupid sifts through mounds of behavioral and demographic data in order to shed light on how and why we behave.

This sort of content doesn’t overtly push an agenda; it relies on the quality of the content to add value to the brand, legitimizing them as experts in their fields.  You know what? It works.

In closing, I’d like to turn the spotlight on you, the readers. How does your brand engage in thought leadership?

 

 

 

Social experiments are powerful displays of how humans behave in certain situations.  They can range from documenting individual behavior or that of an enormous sample of people.  Many times a moral element is involved in the situation.  They can be used to illustrate both the good and the bad of human nature, and are generally consumed by a public that has an innately narcissistic interest with how we as a people behave. As a marketing tool, it can have a powerful effect if done right.

However, social experiments in viral marketing settings can be a gamble.  Not informing people of a company’s potential involvement can generate distrust and actually do more damage than good.

For example, ambiguity around Starbucks’ role in the “John’s Card” pay-it-forward story has created negative buzz around Starbucks for potentially hiding its involvement in the viral movement around one man’s gift card. As well-intentioned as it may have been, you can’t run a morally-focused viral campaign while exhibiting any sort of moral ambiguity at the brand level.

It reminds me of this little bit about hidden camera commercials:

If you’re going to conduct a social experiment, the concept has to align with the company’s values, and it typically pays to not trick participants when it comes to brand involvement, event if it’s for a “gotcha” effect.

When I look back at various viral marketing campaigns that I’ve been exposed to over the summer,  I can’t help but think of one that stood out as an all-star:

Honest Tea’s Honest Cities Campaign

On July 19th, Honest Tea set up unmanned Honest Tea stands in 12 cities across the US.  alongside the racks of bottled teas was a glass box and a sign that said “Honest Tea $1 (Honor System)”

The stands were live-streamed, and online users could see people making the decisions in real-time. At the end of the day, the cities were ranked by how “Honest” they were.   Surprisingly, most of the cities displayed honesty rates of 90% or greater: NYC and LA were the exceptions, (and losers) coming in at 86% and 88%, respectively. Online users could virtually participate, choosing to pay to receive a coupon for a bottle of tea, or choosing to receive one for free. Even online, 90 percent of participants paid.

Why did Honest Tea’s morally-focused campaign trump Starbucks’ “John’s Card?” Simply put, they were more “Honest.” There was no real agenda to the experiment: Participants weren’t chided for takin the amoral route. It simply was a simple experiment that captured everyone’s attention.

HT didn’t shy away from being associated with the social experiment. By embracing the experiment as their own, they were able to showcase how closely the moral experiment aligned with their company values.   Their brand became representative of the greater good that was displayed across the 12 cities.

The most impressive part of the campaign was its paradoxical nature: simultaneously in-real-life and digital; concurrently nationwide and geo-localized.  It was accessible, easy to participate in, and created a strong link between the brand and its values.

There’s something basal and universally intriguing about seeing how we as a people behave when presented with simple moral choices. I have to admit, I was both surprised and reassured by the results of the campaign.