Keeping New Media Advertising Honest
Mar 10, 2008 Author: ResearchTalk | Filed under: Advertising, Integrity, RWOur October ‘07 Spotlight column in ESOMAR’s Research World magazine
Now that new media accounts for a significant portion of advertising revenues, advertising bodies are investigating how to future-proof its self-regulatory framework.
Breaking news: as far as advertising goes, the internet’s not quite the bad boy it may appear to be.
As Richard Knubben, policy & compliance manager at EASA, the European Advertising Standards Alliance, puts it: “On the whole, internet and new media-related complaints have made up a relatively small percentage of total advertising complaints over the last couple of years, but are slowly rising.”
And according to Christopher Graham, director general of UK advertising regulator the ASA, that’s because people see traditional media including TV as ‘push’ and so uncontrollable by the recipient, whereas new media is more ‘pull’. He adds: “…people have an expectation about the internet. If they encounter some nastiness they just go away… in context, they would probably expect some advertising to be, frankly, raunchier or sexier than on TV.” A conclusion supported by a 2005 research study commissioned by the ASA.
If it ain’t broke…
But while complaint levels are relatively low, complaints do exist. And according to Knubben, half of Europe-wide complaints about advertising on the internet relate to spam and the remainder to everything else internet/new media.
Spam, by definition, is tricky for authorities to control given its pernicious nature.
But it is parts of the ‘everything else’ category that self-regulatory organisations (SROs) are looking to manage. Most complaints here, according to Graham and Knubben, relate to misleading consumers, e.g. airlines not displaying fully inclusive prices.
And where such infractions are committed in conventional forms of paid-for online advertising (banner ads., search listings, etc.), Knubben believes that eCommerce-related cases can be resolved across Europe through the UCP (unfair commercial practices) directive which is in the process of being implemented.
However, one of the issues being debated is whether or not to include corporate websites. In the UK, Graham says, “We’re in the embarrassing position that our third most complained about non-broadcast medium has 90% of complaints that are out of remit [because they relate to corporate websites]…if this continues, it will erode the relationship we have with consumers because they regard it as advertising.”
The fact that corporate websites are not regulated has offered companies a back door. For example, while being banned from airing an ad. on conventional media can impact brand reputation, the free publicity may drive traffic to the company’s website where the ad. can be shown in full, uncensored. Moreover, the reach and low cost of websites like YouTube only makes online even more attractive.
Graham believes that corporate websites being outside a regulatory framework “is a threat to effective enforcement.” But regulating corporate websites could prove controversial. As well as going against the spirit of the internet, opponents would cite freedom of speech arguments over editorial content. Graham is quick to recognise the sensitivities here: “…is it clever for advertising self regulators to say ‘no we don’t go there’ if that’s where the action is in respect of claims or material on those websites that’s clearly advertising…we don’t want to be making judgements on editorial claims in the website.”
Maintaining public trust
It’s not just online advertising’s rise in importance that has driven these deliberations. Pressure from regulators over HFSS (high fat, sugar and salt) advertising has also been a factor.
So the EASA has created a new media initiative to spearhead Europe’s advertising self-regulation efforts. The EC Directorate General for Health and Consumer Protection, DG Sanco’s director general Robert Madelin has organised an advertising roundtable with EASA, the EC and interested NGOs. And in a recent meeting, according to Graham, Madelin “challenged [the SROs] to see what they were doing about new media”.
In the case of the UK, the Advertising Association, responsible for furthering the interests of all advertising stakeholders, has created a working group including a diverse set of experts and specialists to look into future-proofing new media.
And in Spain, a successful online advertising trust mark scheme (“confianza online”) is already in use. Its success is attributed to having wide take-up because advertising regulation there is member-based. This is in contrast to a similar UK scheme (Admark) that failed due to poor uptake because advertisers had to voluntarily sign up to it within the context of an ad. self-regulatory scheme that is otherwise comprehensive.
FREE: Why $0.00 Is the Future of Business
Feb 25, 2008 Author: ResearchTalk | Filed under: TrendsThe trend towards free, as postulated by The Long Tail’s Chris Andersen
Surely economics has something to say about [the free model]?
It does. The word is externalities, a concept that holds that money is not the only scarcity in the world. Chief among the others are your time and respect, two factors that we’ve always known about but have only recently been able to measure properly. The “attention economy” and “reputation economy” are too fuzzy to merit an academic department, but there’s something real at the heart of both. Thanks to Google, we now have a handy way to convert from reputation (PageRank) to attention (traffic) to money (ads). Anything you can consistently convert to cash is a form of currency itself, and Google plays the role of central banker for these new economies.
There is, presumably, a limited supply of reputation and attention in the world at any point in time. These are the new scarcities — and the world of free exists mostly to acquire these valuable assets for the sake of a business model to be identified later. Free shifts the economy from a focus on only that which can be quantified in dollars and cents to a more realistic accounting of all the things we truly value today.
Our December ‘07 Spotlight column in ESOMAR’s Research World magazine
Barely nine years old, few would deny that Google has had a significant impact on the world. But does Google bode well for the MR sector?
Mainak Mazumdar, VP of Measurement Services at Nielsen//NetRatings, probably sums it up best: every time, he notes, someone steps on a Google property, Google gets a bit more insight into their behaviour and, as a result, a bit smarter.
And as attention continues to shift online, and Google solidifies its position as a dominant destination, it is clearly becoming more adept at understanding not only consumer behaviour but also intention – i.e., when you enter a search query, you’re telling Google what you want to see, read, buy, do etc. And Google takes advantage of that to give you ever more relevant results.
So could this understanding one day trounce what MR has to offer?
Google vs. MR
The short answer is probably not. Note the use of the qualifier ‘probably’.
That’s because having canvassed a variety of folks in the sector, none believes Google to be a direct threat to MR.
For example, Gian Fulgoni, chairman and co-founder of online measurement provider comScore, says that Google is more client than competitor, because that’s the only way it can get that all-important demographic profile of its audience.
Plus, Max Kalehoff, VP of marketing for Nielsen BuzzMetrics and a widely respected marketing blogger, believes ultimately that the biggest brake on any Google ambition to know everything about everyone will be a natural distrust of large institutions: “While I admire and trust the many Google people I’ve met over the years, I don’t fully trust the big institution. In fact, there are very few big institutions I trust, though Google does rank pretty high… you just can’t be a true infomediary without unequivocal trust.”
And that’s something that does not work against MR firms because they are many, many times smaller than Google. In fact, 2007 was yet another milestone for Google’s growth. Having floated on the stock exchange in 2004 at $85, it is now well over $600 with a market value of over $200billion. That’s bigger than the next four largest media companies combined. And now temptingly close to it’s arch nemesis, Microsoft.
In Google We’d Like To Trust
To its credit, Google realised the importance of trust early on. And it’s something CEO Dr. Eric Schmidt mentions on a regular basis at events and during Q&A sessions. Along with the ‘don’t be evil’ moniker it proudly displays as it’s informal motto, Google seems to have worked hard to maintain user trust.
When you look under the hood, you soon realise that Google’s ethical and ‘be good’ stance is more than skin deep. But as with any profit-making organisation, there are times when the economic motive conflicts with the desire to do right by the user and society.
Take the controversy over its email product, Gmail. A product that automatically reads the content of user messages to display relevant advertising. Privacy groups had a field day when it launched. Google’s attempts at reassurance were not well received (it emphasised that computers, and not humans, read the emails). The Gmail product lives on and it’s interesting how its popularity is undiminished by the privacy issue: it’s almost as if users are prepared to trade some privacy for utility.
Increasing Footprint
The reality is that Google’s online presence and influence shows no sign of abating. When Mazumdar talks about people stepping onto Google property, many still largely think of Google the search engine. But Google’s portfolio of services has grown rapidly and it’s becoming very difficult to avoid the plethora of highly regarded and largely free services, many the result of acquisitions over the last 12-18 months.
Services such as the number one video platform YouTube; the number one feed syndication platform, Feedburner; Microsoft Office competitor Google Docs (online word processing, spreadsheet, presentation) – all totally free. And the biggest acquisition to date, display advertising provider DoubleClick, is currently awaiting regulatory approval as a result of Google’s perceived dominance of the online advertising market.
And then there’s Google foray into arguably the biggest online phenomenon of the time, social networks. But Google’s Orkut is not perceived as big a success as its other products since it’s only really popular in Brazil. And it’s recent attempt to tie up with the wunderkind Facebook was snubbed.
Suddenly, size has its downside.
Forrester: The Connected Agency
Feb 18, 2008 Author: ResearchTalk | Filed under: Advertising, Marketing, Media, RW
Forrester Research recently published an 18-page report/detailed thought-piece provocatively titled ‘The Connected Agency’, discussing the model they foresee successful advertising agencies migrating towards to overcome many of the disruptive influences and changes in consumer behaviour we’re seeing.
Needless to say we were interested in exploring these issues and challenges with one of the authors of the report. And we roped in Tony Effik, planning head at a digital agency, to better understand the ramifications not just for the advertising world but also for brand marketers, and for media, marketing and research agencies.
It’s not a pretty picture…
UPDATE: In the podcast we mention that the report’s free. Actually, it was free for a while but now they’ve started charging!
STARRING
- Mary Beth Kemp, report co-author and Principal analyst, Forrester Research
- Tony Effik, Head of planning, Publicis Modem. Tony also blogs about the social graph here
Gian Fulgoni, comScore
Jan 25, 2008 Author: ResearchTalk | Filed under: Media, Online, Social networks14mins
STARRING
- Gian Fulgoni, Chairman and co-founder, comScore
As well as popping into see Max during our recent US trip, we also caught up with Gian Fulgoni of comScore in the Chicago office (their HQ is in Virginia where CEO Magid Abraham and much of the engineering team is based).
comScore is one of the main providers of internet measurement and competes with Nielsen Online (formerly Nielsen NetRatings), Compete.com, Hitwise, and Quantcast as well as others. That said, comScore and Nielsen are generally considered the bigger boys of the bunch given how often their share data is cited in the media (e.g. monthly shares in the lucrative online search market).
The internet measurement sector is very technology-hungry. In the early years, comScore literally ate up millions of dollars to get its IT infrastructure established and working right. It has one of world’s largest databases as a result of the oceans of data being sent back daily from panelist PCs (a widget records their internet activity, with their permission, and siphons it, along with detailed transaction data, over to HQ). These efforts were rewarded when, in 2007, comScore was annointed one of 47 technology pioneers at the WEF in Davos.
2007 was arguably a good year for comScore’s initial investors. 2007’s IPO provided for a much-needed liquidation for this band of investors who backed the firm since 2000, including after the dotcom bust when venture financing virtually dried up.
At one point comScore’s market cap hit $1bn; it’s still pretty amazing to think that a company that has only been trading for around seven years is already worth over half as much as TNS, a widely admired and solid growth firm, but one still largely based around traditional research techniques.
In this short chat with Gian, we discuss an area that he’s passionate about: why ad. dollars are only slowly moving online. It’s that old chestnut: online finally commands a significant amount of consumer attention (compared with other media such as tv), and yet still only commands a fraction of the advertising dollars spent on tv and other mass-market media. We also ask him about whether Facebook is worth the reported $15bn, the conversation having taken place shortly after Microsoft made its investment.
comScore is Gian’s second business success. Prior to this, both him and Magid led IRI through a period of rapid growth. And in-between, he found time to invest in Gibsons, a successful steak restaurant in Chicago (which we, of course, had to sample - very yummy!).
MR - A High Tech, Indian Perspective
Jan 21, 2008 Author: ResearchTalk | Filed under: Online, Outsourcing, Segmentation13mins
STARRING
- Praveen Gupta, Director and co-founder, Cross-Tab
On a recent trip to India we were keen to learn a bit more about the state of the research industry there and were pleased when Praveen Gupta invited us over to Cross-Tab’s Bangalore office for a chat.
Must admit that not having been to India for a long, long time, we didn’t know what to expect in terms of the state of development there. You hear about a sub-continent that is home to both extreme poverty and some of the most technologically advanced organisations in the world as a result of churning out probably more science graduates than anywhere else on earth.
Bangalore is one of three cities, alongside fellow southern cities Hyderabad and Chennai, vying for the super high tech crown. There’s an incredible buzz as you travel down surprisingly modern streets from the airport. We later learn that the local mayor did this strategically to give the impression that all of Bangalore was like that whereas this is only the case for certain ‘key routes’.
We got to know about Cross-Tab when we wrote about them hiring a global CEO from Microsoft (Kumar Mehta, a former top executive there). Cross-Tab’s claim to fame is both as a pioneer in MR outsourcing and, apparently, “the only full service online research agency in India”.
In this short chat with Praveen, a co-founder and modern-day Indian entrepreneur, we hear about…
- MR outsourcing (and how this accidentally became one of their strengths)
- Online research in India
- The middle class
- The super rich
- Indian entrepreneurism
- The market for MR
- Future challenges
- Blog mining
The full chat with Praveen was quite a bit longer and highly informative and stimulating. We’d like to thank him again for the warm hospitality.
Max Kalehoff: Advertising, Privacy, Trust
Jan 9, 2008 Author: ResearchTalk | Filed under: Advertising, Privacy9mins
STARRING
- Max Kalehoff, previously VP Marketing with Nielsen Online and now VP Marketing with Clickable. He blogs here
Max’s career to date has covered internet measurement (Media Metrix, comScore), WoM and CGM (Nielsen Buzzmetrics). He’s a well known and respected marketing blogger and is passionate about making advertising compelling and relevant (so much so that he moved to online advertising firm Clickable shortly after this conversation).
The conversation covers Max’s views on engagement, defensive branding and, increasingly an issue, the trade-off between advertising-driven business models and consumer privacy, a la Facebook’s Beacon and Google’s purchase of DoubleClick.
BTW, Max and I briefly met at Nielsen’s eery-feeling Manhattan HQ, during a recent US trip. After a relaxing sushi lunch, we headed back to the office to record the above chat and props to Max for making time even though it compromised his prepping for a major client conference.
Over 99% of the interesting stuff we come across during our sessions traversing the newsosphere (blogs etc.) don’t make it to this blog because we deliberately decided to focus on posting mainly podcasts and the odd article so as not to crowd things too much.
If you’re not reading this on the website then take a few moments to pop there. Because we’ve added a new box, top right, where we’re sharing interesting links from our cyber travels. As usual the coverage is broad, reflecting the diversity we try to cover on ResearchTalk, so this may not suit everyone.
But for those who are interested, come visit us often (list updated multiple times daily). Alternatively, given our RSS-enabled world, you can choose to subscribe to the link-blog feed here. And do let us have your feedback, good or bad.
Merci.
Funny Thing, Curiosity
Dec 12, 2007 Author: ResearchTalk | Filed under: Conference
Photo credit: Jack French (Flickr)
Curiosity may have killed the cat but proved to be in plentiful supply at the second ResearchTalk Mixer in London last night.
Kindly hosted by Dan O’Donoghue, the worldwide strategic planning director for Publicis, the aim, as always, was to bring together a bunch of interesting and innovative folks from diverse backgrounds in research and planning, to engage in some smart and stimulating conversation.
The conversation stimulants were William Higham, a trends consultant who expounded on this piece, allowing the group to think through the profound implications not just for brands but for society at large. And also Emily (Stokes) Hotchkiss, a creativity coach actively working to unleash creativity among creatives, business execs etc.
We’re really grateful to everyone who made it, particularly at this very busy time of year:
- Dan O’Donoghue, Worldwide strategic planning director, Publicis
- David Penn, MD and founder, Conquest Research (doing some interesting stuff on the emotional unconscious in advertising)
- Emily Hotchkiss, Creativity Coach
- Jaroslav Cir, CMI director, Rexona (Unilever)
- Neil McPhee, MD, Nuance Research Ltd (NLP, ethnography, qual)
- Olaf Willoughby, MD, The Willoughby Partnership (creativity and innovation consultant, and photographer)
- Sam Winstanley, MD, Forget Data (data mining specialist)
- Sheila Keegan, partner, Campbell Keegan (just made a fellow of the MRS)
- William Higham, trends consultant, Next Big Thing
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