Brand Valuation Metric for VCs: Your Start-Up's Social Media Presence

According to the WSJ, start-ups  seeking venture capital should know that the value of your aspiring brand is directly correlated to your presence on Twitter, FaceBook and other social media platforms.

The article included 10 basic rules for start-up marketing gurus, including “Rule #8: It’s better to have a huge following on one platform than to have a mediocre following on several.”

The article caused me to smirk, as the first thought that came to mind while reading the article and and simultaneously thinking about how Twitter and FB are so easily manipulated by robots, was Forrest Gump’s fav: “Stupid is As Stupid Does.”

During the better part of the past 20 years (starting well in advance of the “Internet Bubble”), this blogger has led various start-ups and has worked with a broad universe of VCs and private equity icons in the course evaluating multiple enterprises who sought (and still seek) to disrupt the norm with innovative approaches and cutting-edge technology.   I’ve huddled with prescient grey beards as well as a multitude of B-School geniuses, the latter of whom like to believe they know everything there is to know about..well..everything..And, that latter group is necessarily fixated on current trends and what’s next..often courtesy of their schoolmates who aspire to be the next Mark Zuckerberg.

I’ve also interfaced with more than a few corporate marketing execs who are responsible  for driving brand strategies for their respective companies…many of which are Fortune-level corporations.

For those who don’t know it, when  it comes to investing, the herd mentality (which is what the WSJ article profiled), sheep are influenced by what all of the other sheep are doing.  Because VCs are making bets on companies with significant social media presence (however fleeting that presence actually is), they could easily be using the same capital to day trade commodities..which are much more liquid.

 

 

 

 

Brand Valuation Metric for VCs: Your Start-Up's Social Media Presence

Militants & Dictators Buy In To Twitter IPO

Makes sense that the world’s best-funded anarchists are hoping to capitalize further on Twitter; according to un-named European and Mid-Eastern bankers and brokers, a bunch of them are lining up to buy into the upcoming Twitter IPO.

For those not already in the know, Twitter–which is still trying to figure out its product and revenue model to justify its entree into the favored-nation world of multi-billion-dollar-valuation tech companies—this social media weapon is not just “all the rage” among democratic nation politicos and the universe of celebs, pontificators and opinionators, Twitter is the propaganda tool of choice for a broad spectrum of road-raging dictators and evil-doers….

Did we forget to add: recent studies have determined that easily more than 10%–and perhaps as much as 20% of “tweets” are created by artificially-intelligent robots who churn out chum in a systematic fashion–with the obvious goal of both influencing and luring unsuspecting dolts who believe what they read.

Here’s a good news clip profiling “terror on twitter” ..For those who aspire to own a piece of the next big IPO, be careful what you wish for.

http://jn1.tv/video/news/terror-on-twitter-how-militants-turn-to-social-media.html

 

Militants & Dictators Buy In To Twitter IPO

#Native-Advertising: A Boon or a Boondoggle? Do Storytelling Ads Usurp The Fourth Estate (Journalism)?

Per today's insightful article by New York Times' reporter David Carr, product-placement techniques that have always been the rage within the framework of film/television (as well as selective use within novels) are permeating traditional journalism via "native advertising"(aka "sponsored content")--to the chagrin of among others, The Wonderfactory's Joe McCambley, the fellow credited with introducing the web's now ubiquitous application: banner advertising.

Similar to the notion of "narrative persuasion"--Carr spotlights  the "Fourth Estate" increasing trend towards delivering content that subliminally masks the ultimate agenda of articles that appear to be unbiased, but necessarily put a hopefully powerful spin in favor of the referenced product or service.

When the lines between advertising copy and journalism intersect, that's when audiences might/should cry "foul"---or so McCambley argues. Can you say "Pandora's Box" 5x times in rapid succession?

Ironically, the New York Times, along with Forbes Magazine and a roster of other mainstream news outlets, is now full steam ahead using this very strategy to serve its advertisers. Without intending to endorse advertisers that appear on the page, here's the link to the story:  

While you're at it, an informative (non-sponsored!) article re storytelling and narrative persuasion can be found by clicking this link.

Great News: We're Moving to a New Location

Thanks to my pals at Golpik.com--visit our new website at www.thejlcgroup.com~

Old School Ad Execs Sweat as Data Geeks Displace Them

With a sense of wry review to a reasonably interesting article in today's WSJ (by Suzanne Vranica and Christopher Stewart--one that profiles the certainly-changing advertising industry landscape, and the diminished roles of wannabe Don Draper-types, below is one of several dozen comments posted to the WSJ online version of the article:

Accusing the ad industry's embracement of technology for being the cause of the downfall of martini-drinking creative geniuses in the ad industry makes for a great story, but the lamenting by those profiled in the article, i.e. those who find themselves without a seat is part sour grapes and part "I'm in the 80-20 Club" mindset...i.e. those that thought punching a clock without being truly relevant was a ticket to that second home in Aspen.

To best frame my observations re: a good snapshot, I should first preface that I speak from perspective of someone who spends considerable time on the fringes of Don Drapper’s Madison Avenue—but only after a more-than 15-minute career within the bowels of Wall Street, where my role as a “exchange floor specialist” had me bringing buyers and sellers together.  That role has long since become “electronified” and to a great extent, very specific human tasks associated with that role have been diminished, and in many instances, extinct from human interaction.

As poignantly observed by one creative blogger’s posting immediately subsequent to the announced merger between Publicis and Omnicom, the CEO of Omnicom referenced the combination of these two firms akin to building the next NASDAQ Stock Market; which was actually a somewhat narrow view of how the advertising industry will likely evolve.

Two of the 2 dozen online comments posted below your website edition of today’s article—those made by Mssrs. John Hooper and Bill Brown-- were perhaps the most well-thought out.

Notwithstanding the evolution of the global equities markets, the role of those who provide marketplace insight has remained a critical component. Buyers responsible for allocating significant capital remain reliant on trusted relationships, albeit those folks now necessarily need to be equipped with metadata talking points; but the human relationship remains paramount.

The buying and selling of highly-commoditized products obviously lends itself to automation and “AI”. Mid-level ad buyers will deservedly need to re-tool or seek other roles; much of what they do is better done via transparent electronic platforms. But, the creation of compelling, response-inspiring ad content that must not only conform to microscopic-sized screens or 70-character shout-outs or single images, but actually convert the viewer into an on-line shopper is, in this opinionator’s opinion, a holy grail that is still far from the reach of ET, AI or any other form of unearthly intelligence. The odds of someone introducing an insertable device that prompts delivering electronic messages to the brain that in turn, causes purchases to be made, are less slim than any AI will create crisp content that compels a call to action. Caveat: Simple phrases like “Buy this now, you schmuck! Because you deserve it!” will still inspire broad brand recall and the consumption of billions of dollars worth of burgers, cigarettes and booze.

The take-away: much like the way computer algorithms have become a defacto part of the financial market world of buying and selling, and much like similar tools and processes since embraced in other industries, the buying and selling of mid-level advertising placement budgets will be consigned to computers. The ability to deliver content that (I) creates recall and (ii) most importantly--converts into consumption within a new “Honey I Shrunk The Kids” landscape is wear the rubber will meet the road for those neuroscience-induced lab rats hiding behind quant guru pocket protectors. 

Delivering the right ad at the right time to the right place is as simple as securing an exclusive sponsorship deal with FB; tell me your story and why I should buy you within a 1 inch square space is not going to happen easily or quickly. And just as important, bulge bracket buyers—those allocating tens of zillions of dollars are always going to require a big fat, medium-rare steak..and ideally, front row seats at the next Knick game. The Advertising King is Dead, Long Live the King. 

P.S. Facebook actually doesn’t seem to have ‘exclusive sponsorship’ opportunities—such as a flower industry sponsored call to action that any marketing guru would expect to appear within the same ‘alert notification’ that’s displayed when  your mom, your daughter, your wife, your girlfriend, your mistress is about to celebrate a birthday or other occasion. “Today is your mom’s birthday—click here for the Facebook Endorsed Florist—It’s Low-Priced and High Quality!”… Trust me when I suggest that a computer can’t come up with that idea and a computer can’t pitch it to the knuckleheads at FB that think they’ve now got their mojo in mobile. 

       

Jay Berkman

JLC Group

Blogger Scoops Ad Industry MegaMerger; #Omnicom Chief Likens Ad Business Model to #Nasdaq

Hiding in plain site 2 days ago (Saturday afternoon's NYT digital version), we noticed a blurb/ brief mention of what was obviously the biggest merger in the history of the ad industry. Somewhat surprised that this blogger was the first to 'tweet' it, and even more surprised that the story didn't make the Saturday evening news or the following Sunday morning newspapers, we figured that Perry White must have been on holiday in the Hamptons.

Seems we were right on both counts. Omnicom and Publicis Groupe's plan to marry is the MadMen Industry's biggest event since...well certainly since Darrin Stevens took over McMann & Tate and Samantha blinked Tabatha to walk on the moon for a Kodak commercial..

After senior editors and reporters returned from their summer weekend, the 2 day old story appeared on this a.m.'s NYT front page, but only because WSJ cub reporter Jimmy Olsen apparently sent his girlfriend and NYT columnist Lois Lane a txt msg that read: "Ad Industry Merger: "Market Moving to NASDAQ Model" Says Designated Madmen Mogul.".

And the rest, they say, "is history" [in the making]. Jimmy Olsen will undoubtedly be charged by a joint task force led by Eric Holder and Preet Bharara for disclosing insider information. Lois Lane can be expected to be arraigned later today for conspiracy to disclose confidential information that Nasdaq has already negotiated to acquire the merged entity after the merger passed muster with the FTC...

The SEC of course has already put out a statement : "We've heard nothing, we've seen nothing and we know nothing ...about any disclosure of non public information involving any of these very public companies...." An SEC spokesman added (without being authorized to speak or think), "If Nasdaq has actually played a role in bringing these two ad agencies together in anticipation of acquiring that new entity so they could dominate the buying and selling of ad placements via an electronic market...well..that sounds good to me!"

Boon-Time for Marketing Gurus: Business Owners Are Planning Marketing Blitzes After SEC Action on Unregistered Shares

Today's WSJ Small Business column does a good follow-up re yesterday's post re SEC embracing the JOBS Act..

As a result, some entrepreneurs with businesses ranging from ride-sharing apps to portable farms (to hedge funds!) say they're planning marketing blitzes that they hope will help them reach the right target audiences of potential investors. Under consideration: putting investment offers on billboards and even printing them on T-shirts.

"Whoever has the slickest ads will make the most money here," says Heath Abshure, president of the North American Securities Administrators Association.

Enough said. Until of course, there is a proliferation of frauds and scams--situations that the SEC has little ability to prevent before it happens; best evidenced by the Madoff scandal.

Hedge Fund Advertising Strategies Uplifted by SEC

We told you so..(8 months ago!)..
In connection with last year's passing of the JOBS Act, today the SEC is expected to officially approve a new rule that would ease 80 years of advertising restrictions on ways that hedge funds and other companies seeking to raise money through private offerings.
 


The rule would ease 80 years of advertising restrictions that help ensure small investors aren’t lured into taking inappropriate risks. Under the new rule, startups and other small companies would also be able to use advertising to raise unlimited amounts of money.

“It changes the whole paradigm of who you can talk to,” said Brian J. Lane, a former division director at the SEC and now a partner at Gibson, Dunn & Crutcher LLP in Washington. “Hedge funds will benefit because they have the most restrictions on their ability to communicate more broadly about different funds coming to market.”

The rule affects how companies raise money through private offerings, which are exempt from requirements to publicly report financial statements. Private offers are restricted to wealthy investors, who are considered better positioned to understand the risks of investing with less information.

For the full story from Bloomberg LP, please click here

Memo to Corporate CEO's & CMO's: Why FB Bought Vine: Because Its ALL About VIDEO, Stupid!

For you corporate chiefs and marketing czars who somehow missed the most poignant and succinct explanations [courtesy of more than a few Fortune CMO's and global branding experts] with regard to this week's Facebook Incs (NASDAQ:FB) purchase of Vine, and the strategy to incorporate that video toolkit into Instagram--here it is, in a nutshell--courtesy of the smartest marketer in the world (SMITW):

"Its all about video. Any corporate executive, any entrepreneurial leader of a fast growth company, any senior capo of a B2B enterprise, whether within the financial services space, the legal industry, the accounting industry, the professional services industry, or anyone advising executives who strive to distinguish themselves among the clutter needs to understand that if you are not delivering a corporate message via video, whether its 16 seconds, 60 seconds, or 90 seconds--you've outlived your usefulness to your organization."

You'll notice that above comment included 'financial services'..for you sell-side investment bank and brokers, buy-side investment managers and advisers, and let's not forget all of you fast-paced hedge fund marketers who need to spend the next year or so wrapping your arms around compliance issues before shining a brighter light on your value proposition--here's a news flash that isn't being repeated on CNBC: You've already been 'lapped' by competitors who are already on their 3rd iteration of videos in which their company executives and staff are shining brightly on a video screen near you--and one that's presumably nearer to the clients that you would like to impress.

Case study courtesy of NorthStar Financial, one of the financial advisory industry's most recognized brands: Not only did the folks at this Omaha-based, "Land of Buffet" financial behemoth  figure out the power of video messaging well ahead of their peers, this multi-legged enterprise, which serves a broad spectrum of registered investment advisors (RIAs) created a captive digital media production company (Advisor Studios) to punch out compelling B-rolls for RIAs and the assortment of other NorthStar clients and strategic partners who want to step up their branding and marketing.

Below is an illustration of the latest B-roll to come out of Advisor Studios..a great B2B piece that was produced and edited with more than solid skills.

And, Yes, for you skeptics that don't swallow endorsements or testimonials easily, there certainly might be more video production firms to choose from than there are pizza parlors and donut shops. That doesn't mean they are all as good as Advisor Studios--or--for those in the New York tri-state area, we have 2 favs--Simba Productions and MediaPlace

Your Web Display Ads: Not Displayed?!

Courtesy of WSJ reporter Suzanne Vranica..

The old adage in advertising—that half the money is wasted but no one knows which half—turns out to be as true for the digital world as it ever was for traditional media.

An astounding 54% of online display ads shown in "thousands" of campaigns measured by comScore Inc. between May of 2012 and February of this year weren't seen by anyone, according to a study completed last month.

Don't confuse "weren't seen" with "ignored." These ads simply weren't seen, the result of technical glitches, user habits and fraud.

The finding implies that billions of marketing dollars are being poured down a digital drain. Last year, $14 billion was spent on online display advertising, estimates eMarketer, 40% of all online ad spending.
Advertisers can blame both technical snafus and more nefarious factors for ads going nowhere. Technical issues include ads being displayed on part of a browser not open on a computer screen—such as when an ad appears at the bottom of the screen and surfers don't scroll down. Another problem: Some ads load so slowly that the Web surfer switches off before the ad comes up, says comScore.

And then there is fraud. A significant number of display-ad "impressions" often paid for by marketers are based on fake traffic. Malicious software makes a website think a person is actually on a page and ads are served up to that fake visitor. In other scams, ads show up on several Web pages but they are hidden behind a window on a website that is the size of a pencil point, according to comScore.

For the full article, please visit the WallStreet Journal via this link