Nice article from Ad Week about advertising in social networks, and how the model there is going toward building experiences instead of just display ads.
This fits well with what I wrote last week on the same subject.

The big question of course is how you measure the success of such campaigns, and how you compare one to another. This opens up again the discussion about engagement metric which I won’t dive in right here, but feel free to read other posts in this blog which discussed this issue

This week I turned my back to Apple and went to buy a Microsoft Zune. The all process got me thinking about the importance of brands. iPods and iTunes importance for Apple is much more than the direct revenue stream.
People that the iPod has an important role in their life got to use iTunes. If you want to really enjoy iTunes you need to run it on Mac OS. In order to run Mac OS you need to buy a Mac. If you already have a Mac, good chances you will also buy some other Apple hardware like external hard drives, Apple TV, etc…
Same was true for Microsoft for years. If you use Windows, good chances you will use MS Office. If you use MS Office, you will probably use Office Live or Share Point Server in your office, and the loop continues.

It’s not just about the fact that it is easier to use other services or hardware from the same company, it’s also that we start to trust this company to give us a full experience around our digital life. We trust them to have the best service for us.

This is exactly why we see such a big war today in the social networks battlefield. Google, Facebook and MySpace are fighting for their brand and all of us trust.

So how does this will affect the future of advertising?
Maybe the way to monetize social networks is not to try and target ads that will take the user out to the advertiser site. Maybe the answer is to incorporate the advertiser content, interactions and brand into the already trusted and familiar environment of the social network (Anyone said widgets?).
If an advertiser can extend it’s messages and even build a “mini site” or experience into a trusted environment like iTunes, Facebook or your device, it can encourage users to interact with it much more. This could also be extended to other environments. WIll you be more likely to buy things from within iTunes, using the same one click mechanism you trust? Will you be more likely to register to a coke awards program from within your MySpace home page?

And yes, I think that this is another good example why brands should look for sites that has high engagement metric from its users. The reason is that those high engaging users are more likely to also interact with his brand and services.

Read/Write web came out with a story today that try to show that Yahoo Buzz got bigger than Digg.
The data that the article is based on is new Comscore data that shows that Yahoo Buzz did passed Digg in the number of uniques.

If you consider just the traffic numbers, indeed it seems that Digg are in big troubles. But a quick look at Yahoo Buzz and Digg home pages will show you a very different picture.

On the Yahoo Buzz home page, the most voted story has 118 votes. Most other stories has less than 30. At the same time, Just by taking a quick look you can see that most stories on Digg home page have more than 300 diggs (votes).
It even get worse for Yahoo Buzz if you go to the tech section where most stories have just about 2 - 30 votes. Even if you look at all stories from the last 24 hours and not just recent hours, the picture stays the same.

So yes, Yahoo Buzz is leveraging the Yahoo home page to build a big reach. But sometimes it’s not about quantity - it’s about quality. Digg users are much more loyal to the Digg brand. Their engagement in the site is much higher. Yahoo Buzz users are more likly to skip to the next hot site, as they are less emotionally invested than the Digg users. There is much more chance that they will stay loyal to the site on the long run. I will even argue that their value to advertisers can be higher (put demographics aside as I don’t know Digg data) as their digital participation is higher.

This is a great example why by looking just on page views and uniques we can get a very disturbed picture of reality. This is exactly why attention and engagement metrics are so important to the future of the web.

We are living in an age when all media types starts to blend with each other. You can watch TV programs on your computer and you can access the web from your TV. Blogs are changing the newspapers business and let’s not even start with mobile.

During all of this, it starts to be confusing when you try to understand how you need to build your content and on what media it should run.

Last week I heard a great new way to look at this world.
Instead of trying to figure out the differences between TV and the web and who blends with who, all we need to understand is how the consumer is going to consume our content and messages.
Going with this, we can say that there are three ways you consume media:

• Leaning back - For example when you sit on the living room couch or your bed and watch the TV
• Leaning forward - For example when you sit on your desk chair and use your computer
• On the move - When you use your mobile device like the iPhone

If you think on the world like that, you will know how to design your content for the best user experience and easily adapt it to the changing landscape of the media devices.

On Thursday I had the pleasure of presenting NuConomy in the Under The Radar Conference (and may I add - we won both the Judges and audience awards).
After my pitch, Rafe Needlman (CNET) who moderated the event asked me a very interesting and important question: "Do I think that advertisers will start to use engagement as their buying currency?"

My answer was that I think it will happen eventually, but it will be a long process.
Coming back home, I thought that I gave just half the answer. The second half is all about why it is so important for the future of the web, that engagement will become the next currency for advertising.

Today most advertisers look on three metrics: Unique users, page impressions and time spent on site.
The number of unique users is no doubt very important and will stay like this. Let us focus on the two other metrics.
By measuring page impressions as a currency we basically encourage sites to create bad user experiences. You can argue that some sites use too much ajax today, but I believe we can all agree that page refreshes are simply bad thing. The best user experience comes from sites that use a smart combination of Flash and ajax. Instead of encouraging this, we actually punish those sites by paying them less money.
Same thing also for time spent on site. Again, we actually encourage sites to be slow. If the pages will take more time to load, if you will need to go through more steps to get what you want, if you won’t be able to get the data through RSS and other channels, you will spend more time on the site. Again, advertisers today encourage sites to develop bad user experience.

Measurement of engagement takes a different approach. In essence, it say that what’s important is not the quantity but the quality. By using engagement as currency, advertisers will say "We don’t want just a million people to watch our ads, we want the right people to watch and interact with our brand". Instead of paying for every joe that see or click on the ad, an advertiser will pay just for the audience he actually want to engage with.
If you advertise a sport product, you want to pay just for sports fans that interact with your brand and not for people who never watched a football game in their life. The more they are engaged in sport, you will probably be willing to pay more.

Using engagement as a currency, will not just encourage better user experience and adoption of new technologies, but will actually yield better ROI for the advertisers.

So if this such a great solution for everyone, why do I think it will be a long process until we will get there?
There are many reasons, but probably the number one reason is the fact that engagement is not a comparable metric. It’s easy to say that one site has more page views than the other. It’s much harder to say that one has a more engaged audience than the other.
We still don’t have any standards to how engagement should be measured. If you read this blog, you know that I believe that there is no just one engagement metric that fits all. Still, I do believe that we all can come up with different engagement standards for each vertical.
So we will have an engagement metric for blogging sites and another for video. Who should define them? It will probably be a joined effort of the community and the IAB. Yes, the world of engagement will be more difficult to navigate in but it is also the right way in order to take us to the next step in the evolution of the web.

The IAB were kind to invite us to do a panel together with Comscore about next generation metrics, in their Leadership Forum conference.
The conference takes place in Chicago this Wednesday. If you are near the area, please ping me back and maybe we can meet up for a drink…

I tend to watch most of my favorite TV shows on the web. Mainly because it’s much more convenient but also because it allows me to see how the different networks experiment with online video ads.

From all the networks I got to say that with no doubt ABC has the best experience. I would love to see their numbers and see if it also translate to better conversation for the advertisers.
It start with the fact that during each advertising break (there are a few of them, each one 30 seconds) instead of just having a video add, the video itself get smaller, and the advertiser gets a full interactive page to use when interacting with the users. Some advertisers like Epson used that to add dynamic navigation and information around the video.

Second of all, it’s the choice of ads.
I’ve been writing about this for a long time - what advertisers need to do is go back to the basics. Understand that the best ads are the ones than enhance the experience of the user instead of irritate him.
A great example is what ABC has done with their own ads. Instead of just show you a 30 seconds trailer for one of their TV series, they chose to show cool humorous interviews and behind the scenes footage of the series. This is great thinking. This is content that people actually like to watch. I found myself sometimes don’t even notice that the 30 seconds have gone and that I can click to continue watch the the show. I actually wanted to keep watching the ad.

Going forward with this concept of more interactive page and cool ads can bring us to some really cool (and crazy :)) ideas.
For example: Why not broadcast the episode live on a specific time (even during the TV broadcast) and let people chat with each one, or write to an interactive message board while they watch the ad?
Why not put an interactive sign for a coupon which you can add to your favorites for later use with one click?
Why not do a one question survey about your product while you show the video ad?

If you want to capture your audience, you need to understand that it is all about the experience.

I guess that all of you gave a lot of attention this week to the free fall of the Google stock, after a report showed a big decline in the number of people clicking on their text ads.

There were a lot of speculation running around about if this is a sign of recession or does the cute little text ads simply lost their magic to the public.

But today, Duncan Riely from Techcrunch came with a very interesting (and quite frankly amazing) twist on the story.
Last November Google has made a small change to their text ads. Instead of counting every click on the surface of the ad, the started to count just clicks on the text itself. The idea was of course to stop counting clicks the users have done by mistake.
Duncan bring testimonies from Adsense users that say that since that change their CTR plumbed into the toilet. Markus Friend, the guy behind the successful dating site plenty of fish claims a drop of %60 in CTR rate!
All I can say is - WOW!

Don’t get me wrong, Google done just the right thing when they made this change. The digital advertising industry should be much more transparent and affective in order to continue getting the advertisers to pour their money in.
But I do think this tells a very grim story about our little industry…
Just think about it - Just last week we all saw a new report claiming that the rate of click fraud on near search results ads is %28.3. That’s almost one of every 3 clicks that the advertiser pays on for nothing.
Now add to that the number of clicks that we were counting by mistake and there is not too much left.
Does advertisers really understand the ROI they get from their digital campaigns?
I guess this is a question that we will all need to answer in the next year. If more stories like that will come out, advertisers will start to lose trust on today ways of advertising.
Maybe it is really about time to go beyond of the click model of measuring value of a customer (anyone said engagement? :)) or maybe we simply need to find a better way to make people engage with the brands campaigns.

About a hour ago one of the Internet backbones suffered a hit and taken with it a lot of the data centers in the US. This also affected our data center in the US and some regions of the world lost access to our platform for about half a hour.
It seems that the network is now running again at full speed, and our servers can be accesses from any place around the world.

I wanted to personally apologize to customers who suffered from this. We put a lot of effort in choosing some of the best data centers in the world to host our servers in order to provide the best service we can.
We will explore the cause of today hit and will work hard to find better solutions that will ensure our 100% availability to all of you around the world.

Please feel free to contact me directly at any time with any questions, suggestions or complaints through this blog or at shahar at nuconomy dot com.

Shahar Nechmad
NuConomy, CEO

Computerworld published yesterday a comprehensive article about the discussion in the analytics community around the measurement of engagement.
If you read this blog on regular basis you already know what I think and if this is your first time here, you can read my quotes in the article itself.

I won’t get here to the full discussion, but I did wanted to talk about another metric that is mentioned in the article - attention.

During 2007 Nielsen and Comscore came up with their own engagement metric. For them engagement is the measurement of the time users spends on a web site or a page.
This is not engagement. This is attention. What’s the difference? There is a thin line there but I believe that attention is passive evolvement while engagement is active interactions (such as comment, posts, purchases, sharing, etc).
But put definitions aside, I also think that measuring time spent on a page, although important, can also be on of the more misleading metrics out there.
I’ll give you an example:
A few weeks ago I had to change the date of one of my flights with Delta. I went to Delta.com and it took me more than three minutes of staring on the page before I figured out how to change my flight.
If all we measured was the amount of time I spent on the page, we will probably conclude that this is a very engaging page/site with a great user experience.
In reality it was exactly the opposite. It was one of the worse user interface possible, a confusing one that just made me don’t really like the Delta brand.

Don’t get me wrong, it is still important to measure the attention metric (and we also do that at NuConomy), but you just need to be careful when you get to conclusions based on that metric alone.