Category: marketing

Can hyperlocal media work

One of the promises of the web and a hoped for future of publishing was the rise of hyperlocal websites that report news on individual suburbs, or even blocks. It appears though the hyperlocal concept isn’t working.

One of the hoped for futures of publishing was cheap, hyperlocal websites that report news on individual suburbs or neighbourhoods and get advertising from local businesses.

Last week US TV network NBC abruptly closed down its Everyblock online service, leaving loyal users angry and bemused. Right now it appears though the hyperlocal concept isn’t working.

The failure of Everyblock

Founded five years ago, Everyblock had an interesting model of mashing up local data like Flickr pictures and government information with news so residents and visitors would have an accurate up-to-date picture of what was happening in their neighbourhood.

Everyblock’s failure follows AOL’s struggle to get their hyperlocal play Patch working, although AOL reported in 2012 that Patch’s revenues have doubled.

Whether that doubling is enough to save Patch remains to be seen, it’s quite clear that some question the sustainability of AOL’s growth in revenues and page views.

All of this raises the question of why hyperlocal isn’t working.

A game for amateurs

The main reason is that there’s not enough money it –anybody who is going to run a hyperlocal site is going to be doing it for love or because there’s a dumb corporation burning shareholders’ equity on the venture.

In most communities there simply aren’t enough advertisers interested to pay the bills and you can forget any paywalling.

Most critically for local publishing ventures, the local advertising market has been suffocated by the web. Twenty years ago, the local plumber or cafe would hit most of their market by spending $2,000 on their Yellow Pages listing and probably double that with a weekly ad in the classified section of the local newspaper.

Today, a web site with sufficient SEO smarts to come up on their first page of searches for their suburbs is enough, many can get away with a free Facebook or Google Plus for Business page, despite the dangers of using other people’s services to promote your business.

For the telephone directories this change has been catastrophic while local newspapers only survive thanks to their less than healthy relationship with real estate agents.

Local market failure

The interesting thing with the evolving local media market is just how poorly the web giants have performed.

Two years ago, Google appeared to have the sector sown up with the Google Places service but a combination of poor service, restrictive rules and an obsession with Google Plus have seen the company squander their advantage, leaving their local search service underused and irrelevant.

Similarly, Facebook looked like they could take that market off Google but they too haven’t executed well.

Which leaves local businesses reliant on their own websites and a hodge-potch of services like Yelp!, Tripadvisor and Urbanspoon.

This doesn’t serve the business or the customer well.

Where to for local news?

A bigger question though is where do people go to find local news?

Increasingly it looks like social media sites like Facebook and Twitter are the place as people see what their friends and neighbours post. It’s not great, but it’s better than the local newspapers increasingly stuffed with syndicated content with a few local stories from an overworked part-timer.

It’s not clear that hyperlocal news has failed, but right now it’s not looking good. Perhaps it needs somebody with a truly disruptive model to find what works in our communities.

image courtesy of davidlat on sxc.hu

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Social media’s free ride comes to an end

Facebook’s Sponsored Stories have ended the free ride for businesses on social media services and now companies are looking at alternatives

One of the mystifying things about the ways businesses use social media is the willingness of companies – big and small – to give their customer lists away to social media sites.

The best example of this is Facebook, when your customers like you or comment on a post they are added to the service’s database. Facebook gets to ‘own’ your customers and generally Facebook gets to know your customers better than you do.

With the arrival of Sponsored Stories on Facebook we see the next step which monetizing their business functions. Now when a business puts a post up on Facebook, it only appears in 15% of their followers’ feeds. To get to the rest of them a business has to buy a sponsored story.

Not only has Facebook taken ownership of thousands of businesses’ customers, it now charges those business to talk to their own clients.

Should the business decide not to pay for sponsored stories then they find traffic from Facebook drops off. Some businesses report traffic dropping from 30,000 views a day to 5,000.

To counter this one website stumped up the money for a sponsored story that advises their Facebook fans to follow them on Twitter and Google+ instead.

Facebook’s move on this isn’t surprising as they desperately search for revenue streams to justify their huge stockmarket valuation.

What also isn’t surprising is that the free ride for businesses on social media platforms is over.

All too often we’ve heard marketing gurus tell us Facebook and other social media services were free advertising channels.

That view overlooked the time and patience required for executing an effective social media campaign along with the reality that social media services were only free for as long as the investors underwriting the enterprise were prepared to accept losses.

We understand that advertising on TV, radio or print costs money and now we’re having to accept that social media marketing costs as well.

How well Facebook goes with sponsored stories remains to be seen, but the message for businesses is clear – the social media free lunch is well and truly over.

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What business are newspapers in?

To understand the future of news, we need to define the business

The problems of The Guardian and other newspaper groups around the world raises the question of what business they are actually in – news or advertising?

“Going digital only is not an option” was an agenda item for a meeting of Guardian executives claims the Financial Times.

Digital only however is the option most of the readers are taking with the Guardian’s online channels attracting 9.5 million UK readers a month compared to a print circulation of 6.5 million. The Guardian’s total global online audience is 65 million, ten times the size of the print edition.

Making matters worse is the trend, according to the UK Audit Bureau of Circulations (ABC), newspaper sales are declining at 16% per year while online readership is growing 14%.

As the Guardian readership figures show, the number of readers isn’t the problem and the same is true for the New York Times or the Sydney Morning Herald. More people are reading these publications than ever before, but the advertising has gone elsewhere.

Essentially a newspaper was an advertising platform, the cover price barely covered the costs of printing and distribution while the classified and display advertising provided the “rivers of gold” that made the business so lucrative through most of the Twentieth Century.

Most of those rivers have been diverted as dedicated employment, real estate, travel and motoring websites have stolen much of the advertising revenue that sustained newspapers.

As classified advertising platforms, newspapers have reached their use by date and now they have to build a model that is more focused on online display advertising and getting readers to pay for content.

Getting readers to pay is difficult when the market has been trained to expect news for free or pennies a day, a problem not helped by some newspapers chasing online eyeballs with low quality content.

Equally difficult is training sales teams to sell digital advertising, too many sales teams have grown fat and complacent over decades of flogging lucrative and easy real estate print ads.

The challenge for newspaper managements around the world is figuring out how to get the advertisers onto their online platforms and providing a product which readers value and are prepared to pay for.

It may well be that The Guardian’s management are right, that print does have a role in the newspaper’s future but first they are going to have to define what their company is and what it does.

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Apple’s line in the sand

The refreshed Apple range will add pressure to Google and Microsoft.

The comprehensive refresh of Apple’s product lines announced by CEO Tim Cook this morning is a clear warning to Google and Microsoft that the market leader in the post-PC computer marketplace is not going away.

With both Google and Microsoft having a major product releases over the next week, the pressure is now on both companies to match Apple’s announcements and product range.

For Microsoft, the stakes are now substantially higher for their Windows Surface tablets. The Fourth Generation iPad and iPad Mini (or is that iPod Maxi?) are going to be the benchmarks the Redmond tablet PCs will be measured against.

An interesting part of the Apple presentation was marketing chief Phil Schiller trash talking the Android competitors with a side-by-side comparison between the iPad and the Nexus.

These comparisons are becoming a hallmark of Schiller’s marketing in the post Steve Jobs Apple, whether this is good or bad remains to be seen, but it is a difference compared to the old boss’ way of doing things. Although Jobs wasn’t adverse to poking fun at some of Microsoft’s confusing habits.

For geeks, and those who like shiny things that go “beep”, it’s an exciting week and Apple have shown why they are masters at controlling the tech media.

It’s now up to Google and Microsoft to see if they can match Cook’s announcements and meet Apple’s price points.

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Playing in the big boys’ sandpits

Businesses using social media, cloud computing and web 2.0 services need to be careful of being shutdown without notice.

The Cool Hunter is a site whose mission is to “select and celebrate what is beautiful and enduring from all that is sought-after in architecture, design, gadgets, lifestyle, urban living, fashion, travel and pop culture.”

In posting cool stuff they find on the web, Cool Hunter always runs the risk of copyright infringement complaints as people have the unfortunate habit of slapping images up onto the Internet without permission from the rights holders.

Last August Cool Hunter’s founder Bill Tikos found the site’s Facebook account had been wiped for ‘repeat copyright infringements’ without warning or recourse.

Anybody following this site won’t be surprised to read this – an exposed nipple can get you thrown off Facebook faster than you can say “New Yorker cartoon” or “it’s only a porcelain doll, for chrissake!” – so one can only imagine the paroxysms of rage that alleged copyright infringement sends Facebook’s puritan bureaucrats into.

It’s not just nipples at Facebook though, thousands of small traders have seen their accounts arbitrarily suspended on sites like eBay and PayPal.

Google too are quick to suspend businesses from their local and search services without warning or recourse. Usually business owners only notice they’ve been locked out when they log into their control panels only to find a terse message that their account has been suspended.

What usually follows is a Kafkaesque tale of trying to understand exactly what they’ve done wrong and how to get their accounts reinstated. In some cases the businesses get cryptic messages saying their accounts are still in breach while others get no response at all. In a few examples, the offending page goes back online only to be shut down again a few days later.

Rarely does someone in this situation find a calm, helpful voice to explain exactly what they have done wrong and how to fix it.

This hostile attitude is a result of the “hands off customer service” model of web 2.0 companies and it’s their biggest achilles heel as, paradoxically, customers and users take to social media to complain about bizarre and arbitrary account suspensions.

For some, like Cool Hunter, it’s a monumental pain and loss of a valuable platform while many of those small eBay and PayPal traders may have thousands of dollars tied up in suspended accounts they can’t access.

Unfortunately this uncertainty is the cost of doing business on social media sites and it’s one of the reasons why owning your own business website is essential.

When you choose to use one of these service, understand you’re playing in the big fat kid’s sandpit and you risk him throwing a tantrum and chucking your toys out of the playpen.

Simply put, don’t base your business on Facebook, don’t keep all your money in PayPal and always have a plan B.

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Facebook’s war on nipples continues

If you want to play on Facebook, you have to play by Facebook’s rules. Particular when it comes to nipples.

Mike Stevens, a cartoonist with the New Yorker magazine, found himself the latest victim of Facebook’s War On Nipples when his cartoon depicting Adam and Eve caused the magazine’s Facebook page to be shut down.

This is the latest shot in Facebook’s War On Nipples. Two years ago a Sydney jeweller found her page shut down for using a naked doll as a model and breast feeding mothers waged a long campaign against the site taking down pictures of babies being fed.

If you live outside the US, it’s amusing to observe Americans’ bipolar attitude towards women’s breasts — on one hand they are celebrated though Pamela Anderson, breast enhancement and Hooters while the merest flash of nipple sends the nation into purient overdrive.

So Mark Zuckerberg’s ban on female nipples is understandable in that context as is the reaction to that ban by people who don’t see much wrong with breast feeding mums or harmless cartoons.

What we should remember though is Facebook have the right to run their site whatever way they like — if Mark Zuckerberg decides he doesn’t like plaid shirts or broccoli he’s within his rights to ban pictures those as well.

This is the risk if you’re basing marketing strategies around social media services. If you want to play on Facebook, you have to play by Facebook rules.

So take your nipples elsewhere.

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This is what happens when you rush things

Nokia’s Lumia 920 debacle shows why artificial deadlines don’t work

Nokia are going to release a smartphone with the best camera seen so far on a mobile phone.

Desperate for good news and positive coverage, Nokia decided to announce the Lumia 920 prematurely and their marketing people are forced to fake the videos and sample photos.

Then they get caught.

And instead of having the media fawning over the impressive features of the Lumia 920, Nokia are scorned. A particularly damaging thing in a fortnight where Amazon and Apple have major announcements.

The problem is giving yourself artificial milestones that can’t be met. People take shortcuts to meet those deadlines and debacles like Nokia’s are the result.

Artificial “drop dead dates” are the mark of panic by poor management. One wonders how long this can continue at Nokia.

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