Twitter Ad Revenue to Reach $139.5M in 2011: Report

EMarketer Projects Twitter’s Global Ad Revenue Will Be $400M in 2013

By:  Published: September 28, 2011

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The current estimated ad revenues for 2011 fall slightly short of eMarketer’s January projection, which held that Twitter would earn $150 million this year. The report accounts for the minor disparity by citing Twitter’s slower than anticipated opening of international sales offices — it has offices in London and Tokyo and is now opening one in Dublin — and the fact that its self-serve ad platform hasn’t launched yet.

Principal analyst Debra Aho Williamson said that Twitter has been very deliberate in its approach to rolling out ad products, but the pace has quickened in recent months, with promoted tweets now surfacing in users’ timelines and political ads, which were unveiled last week. She expects self-serve ads to have a big impact on Twitter’s revenues, when they’re eventually launched.

“Self-service is extremely successful for Facebook and Google,” said Ms. Williamson, who noted that self-serve ads are estimated to comprise as much as 60% of Facebook’s revenue. “So self-serve could really open up Twitter to a new category of advertisers that aren’t currently using the service.”

A Twitter spokeswoman said no specific date has been set for the launch of self-serve ads.

In the report, Ms. Williamson cites solid engagement rates with Twitter’s promoted product suite, launched in April 2010. Average engagement with promoted tweets is 3% to 5%, and advertisers only pay when there’s user action taken — retweets, replies, clicks on links, and tweets being marked as “favorites” — for that particular product.

The split between ad revenues from the U.S. and international markets was 98% and 2%, respectively, for 2010, according to the report. The gap is projected to close slightly by 2013, with the U.S. having an 88% share and the rest of the world having 12%.

EMarketer formed its projections based on analyzing consumer usage, marketer usage, ad pricing, impressions on Twitter and revenue estimates from research firms, as well as interviews with industry executives.

Facebook Launches Program to Help Small Businesses With Their Pages and Ads

200,000 Small Businesses Will Get a $50 Ad Credit, Starting in January

By:  Published: September 26, 2011

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Facebook is launching a small business education program this week, looking to show businesses how to optimize their individual pages and to use its self-serve ad platform to effectively target customers.
The social-media giant is partnering with the U.S. Chamber of Commerce and the National Federation of Independent Business to conduct outreach in the small-business community. The first step is to circulate webinars, case studies and tips, which will be made available starting this week, but Facebook also intends to sponsor a series of road shows in cities across the country starting in October to promote its “Small Business Boost.” The third piece of the program will kick off in January 2012, when Facebook will look to award a $50 ad credit to 200,000 businesses, amounting to $10 million in free advertising.

According to an eMarketer report, 44% of small- and medium-sized businesses used social media as a marketing tool in August, and 59% spent less than $100 on social-media marketing.

“We know that small businesses who use web technology grow more than twice as quickly, bring in twice the revenue, and create twice the jobs as small businesses who don’t,” said David Fischer, Facebook’s VP-Advertising and Global Operations. He said 9.2 million small businesses in the U.S. have pages on Facebook, but only 3.2 million of those pages have active engagement. (Some pages exist essentially as shells, created by user signals on the social graph and without action taken by the business owner.)

“You want to be in front of [people] — maybe it’s a few times a week you’re posting a few sentences, talking about what’s going on,” said Mr. Fischer, noting that engagement is key for small business owners. “In most cases it’s not a matter of this being particularly complicated.”

The program also aims to teach small businesses about Facebook ad products, like its self-serve platform and sponsored stories, which allows brands to build paid advertisements out of user signals such as likes and check-ins. According to Mr. Fischer, the amount that a small business might invest in self-serve ads targeted to their desired audience could range from $20 a month for a single proprietor business to thousands each week. But he says Facebook has learned of success stories, like two auto dealerships in Massachusetts: one that said it generated $20,000 in profits off $300 in ads and another that reported a $500,000 return on a $5,000 ad spend.

Facebook itself generates as much as 60% of its ad revenue from its self-serve platform, according to an eMarketer report from January.

Mr. Fischer says there’s an internal awareness at Facebook that the company’s tools could help stimulate economic growth and noted that Chief Operating Officer Sheryl Sandberg is a member of President Obama’s jobs council.

“We spend a lot of time thinking about how we can work with small businesses, and we know we have tools that can help them effectively,” he said.

All Marketing Roads Lead Through Mobile

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As mobile becomes a key conduit through which people connect with each other and the world — from managing calendars, finances and social networks to navigating online, on the road and on the path to purchase — many are still treating it as ancillary to their marketing efforts.
While the technical requirements of mobile force it into the realm of a specialist expertise, the key to winning lies in realizing that mobile actually represents the confluence of four key marketing disciplines: social media, shopper marketing, promotion and CRM.

Social: It shouldn’t be surprising that for more and more people, smartphones are the link to their social networks. It’s the easiest way to quickly share a photo or experience — on-the-go or at home. According to a recent Forrester survey, the number of adult respondents using mobile devices to access social-networking sites nearly doubled from 2010 to 2011. The usage grew to 43% for mobile users aged 12-17.

People are not only using mobile to tweet, check in, and update status. They’re using it to download daily deals, access their networks’ brand and product recommendations and share their own insights. These behaviors begin to illustrate the irrevocable link that mobile has to how and what people buy — which is the real reason mobile is critical to marketers.

Shopper: Unleashing mobile’s real power depends on understanding its role and potential throughout the shopping and buying process. From looking up store hours, getting directions and reading reviews to receiving deals, comparing prices and actually paying, mobile has the ability to function as an informed shopping assistant 24/7, and the potential is tremendous. Retailers who simply offer mobile-optimized sites increase consumer engagement by 85%, with 51% of consumers reporting they are more likely to purchase from those retailers, according to a study from Brand Anywhere and Luth Research

Moving beyond the basics, however, requires real insight into consumers’ new, multiple and non-linear paths to purchase, as well as how manufacturers and retailers can collaborate. For example, consumers in our Arc Worldwide Mobile Shopper Study report that retailer mobile sites and apps have valuable information about how and where to buy, but are often short of critical product details; manufacturers offer just the opposite. This highlights the opportunity for retailers and manufacturers to work together to optimize site experiences and apps to deliver what shoppers need when they need it.

Promotion: Whether it’s an app or mobile site, marketers cannot assume that if they build it, consumers will come … not to mention download, engage, opt-in and participate. With hundreds of thousands of apps and sites available, marketers’ mobile offerings needs to incent engagement and deliver real value and/or utility to drive ongoing participation. Just compare the number of apps on your phone right now to the number you’ve actually used in the last month, and you’ll see what I mean. As a result, branded games, tiered awards, targeted offers and unique experiences are important to initial trial and, often, ongoing participation. Driving successful mobile engagement is the marketing challenge within the marketing challenge, and valuable, branded offers can help.

CRM: Of course the ultimate goal of all of the above is to build long-term relationships with people who enable the marketer to garner greater insight into their wants and needs, and be better positioned to meet them. At the end of the day, mobile is a one-to-one medium, and as a result, the quantity and quality of information it can provide to marketers is staggering. Mining shared information, as well as the multiple databases generated through mobile usage, can yield insights leading to ultra-targeted programs that meet consumers’ needs on a one-to-one basis.

Marketers who successfully integrate all these disciplines into their mobile offering are delivering powerfully creative programs. Tesco provides a great example in Korea.

Koreans, among the hardest-working people in the world, dread going to grocery stores after their long work hours. So Tesco used this shopper insight to bring grocery shopping to them via virtual stores at subway stops. Images of products, arranged on shelves as they appear in stores, created an inviting user experience that instantly made people comfortable navigating the “aisles.”

Shoppers could place products in virtual shopping carts by scanning QR codes with their smartphones. The products would be delivered to their homes that evening. Sales soared, and excitement spread as people shared their experiences via social media. Participants received incentives to visit the Tesco website, and data was funneled into CRM programs to help shoppers stay happy and loyal. Online registrations and sales increased by 76% and 130% respectively, and Tesco became the number one online grocer and number two grocer overall in Korea.

The Tesco case is just one example, but it highlights the opportunity to move mobile from the marketing periphery to the center by leveraging its unique opportunity to bring social, shopper, promotion and CRM together to deliver creative, branded experiences people value.

Get Inside a Customer’s Mind at the Moment Your Message Appears

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Marketers are good at knowing their customers and capturing their attention, but engaging them remains a challenge. We know, for example, that 27-year-old, red-wine-drinking, book-club-member Vanessa is our target — but how do we sway her? That requires us to ask more questions. It’s not just where does she go, but where does she go when she is happy? It’s not just what is she doing, but what is she thinking and feeling when she sees my brand message? How long will she be there? Is this an experience I want to brand with my presence?

To deliver the right branded consumer experience in the right venue, a two-pronged approach can be very effective. First, identify environments where you can reach the right target – and, just as important, predict the consumer’s mindset at the very moment he or she is engaging with your message. Second, deliver highly relevant messages at critical touch-points where you know the consumer will spend more time.

Media messages resonate when they are in harmony with the environment and even better when the consumer has the time to absorb the message. It seems simple to do; but marketers can miss the opportunity by not customizing the message to match the consumer’s mindset, or by sending the right message in the wrong location.

A message delivered at the point-of-sale is powerful because we know exactly what the consumer is doing the moment she sees the message. If, for example, the consumer is at Kroger, standing in the condiment aisle staring at a sea of mustard brands, then the pitch to try a new mustard can come across as a call to action. The same pitch on a highway billboard two miles from Kroger is reaching a consumer who might be driving to soccer practice or to a funeral, in no frame of mind to be thinking about mustard.

Tailoring the message to resonate with what the consumer is naturally thinking and feeling is key. But you also want to ensure that the message is associated with a positive experience for the consumer. For example, you want to reach new moms? Buy a poster board in an obstetrician/gynecologist’s office, right? But understand that many visits to the doctor’s office are not to hear good news. Advertising on bins used for scanning by airport security is a way to reach frequent travelers, but security check-in is stressful and one of the least pleasant parts of the traveling experience.

People will avoid a food or beverage for the rest of their lives if they become ill shortly after consuming it, even if that food was not the culprit. We all know people who had a bad experience with coleslaw who will “never touch the stuff” again. Linking your brand to a negative experience can have the same lasting effect.

Once you’ve got the right consumer in the right environment, don’t squander that opportunity by presenting material that’s irrelevant. If you are putting an ad on an airplane tray table, when you know that passengers will be fastened to their seats for the next three hours, don’t use your print ad copy. Do what Tylenol did and offer stretching exercises to do while sitting on an airplane. If you are placing media at a winter sports resort, don’t reuse your out-of-home billboard copy, do what FirstBank did to promote online banking and tailor the message, “Bank in your ski mask without getting arrested.”

By predicting where your customers will be and how they will behave when they encounter your message, you can create an experience with the brand that will leave them feeling good about it and even compelled to try it.

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