Bryce Blakely's Blog

The number of times I’ve said that line (at least in my head). I don’t need to go on and on about how prevalent Twitter is becoming as a means of conveying news or as a means of facilitating public interactions between notable parties. Just this year an official format for citing tweets in academic papers was created, much to the chagrin of student the world over. Twitter has reached a level of legitimacy that justifies its multi-billion dollar IPO and also cements the “social media is here to stay” slogan into the realm of truths rather than fads. Twitter’s ability to connect users who otherwise would’ve never associated or heard of each other is uncanny and it’s all by design.

What I find the most endearing about the service is the way it connects me to things I’m interested in. This sounds like the most basic, malaise statement you could make about a service as expansive as Twitter but it is at it’s core fundamentally true, which I believe, lends it some degree of universality among fans of Twitter. I love the Toronto Maple Leafs and every game there is a constant Twitter feed updating me with goals and highlights despite the fact I am sometimes miles from a screen. The Leafs feed opens up a forum for dialogue among fans, it connects you to the team, and keeps you up to date on all goings on for the boys in blue and white. Now I’m aware the Leafs’ fan-base needs no coxing to be vocal but through Twitter it’s impossible not to feel more in tune with your team than ever before. At the end of the day teams are brands the way people can be brands the way brands are brands and everyone has a chance participate in the conversation and eve help shape the content provided. Dialogue is in for the 21st century.

Google is basically the be-all end-all of internet search engines. There are comparables, Microsoft’s Bing, but these alternative services a far cry short of being recognized as a verb in the English language. Holding such a position comes with numerous benefits the biggest and perhaps most obvious of which being the advertising revenue. Companies looking for exposure through search hits advertise through Google to the point where certain broad search terms have been bid up to an exorbitant pay per click price. In recent years Google has expanded its service to numerous different facets of the electronic world including hardware. Perhaps the most successful extension of the Google brand has been their web-browser, Google Chrome, which enjoyed a meteoric rise to popularity.

One of the most popular features of Chrome has been AdBlock, a service provided by Google which hides Advertising that would otherwise be displayed in your browser. The most prevalent users of AdBlock tend to be people who wish to skip through ads at the start of YouTube videos, YouTube of course being a subsidiary of Google. So here we have a company that draws in more advertising revenue than any other search or video platform that is subsequently giving consumers, the same consumers targeted by the companies paying for these ads, the ability to ignore the paid ads entirely. Is it a move to maintain their pristine image in the eyes of consumers while inundating those who don’t use their products with ads? Probably not but regardless if I paid serious money for my ad to show up every time someone searched for ‘music’ I’d want an explanation.

Global BC published an article today that claimed 30% of social media users within the province use social media as a primary means to convey their displeasure with brands they’ve had contact with. In a province with a population of 4.4 million that’s about 1.32 million people, certainly nothing to scoff at. Perhaps a more revealing statistic is that only one in four of these people who complained about a brand on social media received a satisfactory response. Number crunching again that’s 990,000 people who were more or less ignored. In an age where brand interactions with consumers are becoming increasingly important, if not integral to successful business, this is a major issue.

The article goes on to consider the macro impact of these vocally unsatisfied consumers. 81% complain on Facebook where, statistically, each user from BC has an average of 217 friends. That’s the potential for 217 negative impressions for that brand from one user, I don’t need to multiply that by 990,000 for in to be apparent that these negative sentiments have a dramatic ripple effect. It’s time for big brands to take charge and do something about their consumer’s problems. Even if they cannot be rectified immediately or even ever there is still value in defusing the situation through communication. Some of the largest targets of these criticisms have been telecommunications companies and transit companies coming in for a combined 56% of total complaints lodged on social media. These companies have large revenue margins, in the case of telecommunications, nationwide presence. Being unable to provide follow-up for unsatisfied customers is almost completely for lack of trying for firms of this size.

Note: The telecommunications industry in Canada is an oligopoly and as such may just ignore complaints because, for all intents and purposes, they’re the only game in town.

After dismal performance shaking investors faith in the profitable viability of a free online service Facebook has upped its game coming back with Q3 earnings in 2013 that blew expectations out of the water. So how did this turnaround come about? Do I need to even ask that question? The answer of course is advertising. Facebook, as expected, has beefed up the number of ads users are exposed in order to drive up revenues. Users have seen this coming since Facebook announced its IPO last year but so far have remained un-phased by the upswing in advertising.

The calmness of the users who used to be so resistant to any kind of change could be explained by the area Facebook has chosen to target to beef-up its ads. Facebook mobile was where the majority of this new revenue came from. This relatively new format could explain the complacency demonstrated from a usually very volatile (and vocal) community of users. The ads boost was substantial however, revenues from Facebook mobile advertising went from $375 million in Q1 to $651 million in Q2, no srop in the bucket. This is great news for investors now but in the future it will make comparable success much harder to achieve for Facebook going forward.

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I’ve always wonder just how effective advertising on Google is. Certainly, everyone who has used Google has been exposed to the ads that appear after you run your search but how many people actually click these links? For me personally, I’ve never clicked one and I’m almost at a point where I ignore there existence entirely. Like muscle memory my hand automatically hit scroll until I land on the first organic search link. For the first time I finally got some insight into the world of Google Ads with the this term project.

Our AdWords campaign lasted around a week and a half and we managed to generate over 1 million impressions. Impressions of course being Google’s interpretation of people having seen your ad. Our click through rate however was under 1%. Is this effective marketing? Our investment was basically the minimum required but is this strategy worth the expenditures companies put in? Businesses seeking other businesses as clients may do well for their investment but I think on a business to consumer level advertising on Google is significantly less effective.

These days with Facebook struggling to make its earning quotients advertising on the site has been beefed up most noticeably so in the users News Feed. In the majority of past iterations of Facebook the News Feed was used exclusively for updates on a user’s friend’s recent activity on the site. The News Feed now also displays large (and I emphasize the “large” part) sponsored advertisements among these posts. Of course the ads posted are targeted towards the user and this is all to make them seem less invasive but also, from a marketing standpoint, it’s to ensure that the user’s targeted by a brand are getting the messages that branding is sending out. This seems logical sure but users should be aware of how this targeting is done by Facebook.

Now I’ve clicked on random Facebook ads before, out of boredom maybe, curiosity maybe, but usually not because I actually wanted to buy/enlist for whatever was advertised. These liberally given clicks however, have come to play a major part in the way my News Feed looks now. Anything I’ve clicked on in the past seems to keep appearing in one way or another. My reckless abandon has been misinterpreted as a genuine interest in creating my own website using Wix.

The reason for this is of course Facebook’s algorithm used in determining what ads appear on which feed. The algorithm responsible for populating News Feeds is called the EdgeRank algorithm which uses a three-tier ranking system based on affinity, weight, and time. The most important factor here is time. Recent activity becomes the most relevant activity for Facebook so that errant click from last night is liable to continue to stay relevant to your advertising profile for an extended period of time if you are like me and are relatively inactive on the public side of Facebook (public being outside of private groups and direct messages). If you want a truly relevant News Feed, think before you click.

 The biggest news coming out of the NYSE this week was Twitter’s debut as a publicly traded entity. Twitter issued 70 million shares in their IPO at a price of $26 per share. This means that the lead underwriting team at Goldman Sachs and the associate banks involved in the valuation, Morgan Stanley and J.P. Morgan Chase, considered twitter to be a service worth at least $1.82 billion. A high valuation by any metric by any metric but the markets disagreed, by the end of the day TWTR shares were trading for $44.90 a piece. This under-valuation could’ve been a strategic decision by the underwriting banks to avoid the slide that Facebook underwent following their pie-in-the-sky pricing but there’s something to be said about the near 100% increase in share price that occurred in only the first day of trading.

Clearly, Twitter has a huge amount of perceived value among traders. This can’t be explained by profitability however, or any financial metric for that matter, because Twitter thus far has not proven itself to be a profitable company. So why would investors cause Twitter’s value to surge despite having no solid financial assurances about Twitter’s ability to generate profits? The answer is that investors the world over are now recognizing the value of social media. Twitter is tool used by everyone from Barrack Obama to UBC commerce classes. It’s much more than a platform that can be harnessed for advertising revenues, people realize that although it might not be tangible yet, the massive user-ship Twitter has as well as its predominant role in modern journalism and news reporting have an intrinsic value that makes Twitter a multi-billion dollar company. It’s a paradigm shift in the way the market views the social media world and it’s a shift brought about by a better understanding of how these platforms work.

How ’bout no?

We talk a lot in class about the added value that social media can bring to a brand; the two-way communication with consumers, brand exposure at minimal cost, and its use as a relationship building tool. For many brands these benefits are valid, that is to say their usefulness to the brand is matched by the consumer’s willingness to participate. To illustrate, consider my last post about the GoPro and their photo/video of the day program. The program works because the consumers want to participate, they are actively engaged because they want to be.

Now consider brands like Cottonelle pictured above and their “Lets Talk About Your Bum” campaign. First of all lets not (I closed the window immediately after saving the picture this was so ridiculous). Personally, and I think this can be applied more broadly, I don’t want to start a dialogue about my bowel movements with my toilet paper brand of choice. I’m fine with commercials on TV telling me how soft it is, great, I like soft. Do I want to like your Facebook page and broadcast my affinity for Cottonelle Toilet Paper to all my friends? Absolutely not. Sometimes attempting to start a dialogue on social media only makes sense to you and your marketing team and Cottonelle is certainly not the only offender.

Sept 2nd Photo of the Day

GoPro is miniature camera that over the last 4 years has taken the action sports scene by storm dominating all the competition in popularity and even moving into aspects of mainstream film production. To what can we credit this meteoric rise of one specific brand in a industry laden with comparable substitutes? The answer doesn’t lie in product differentiation but in the community GoPro became an integral part of.

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From the original release of the GoPro 1 in early 2010 the company immediately aligned itself with the action sports community by giving sponsorships to athletes in various action sports disciplines and releasing the footage they got with the camera throughout the year in a video. Edits (short videos featuring action sports) were and continue to be hugely popular within these communities and GoPro asserted itself as a premiere tool for edit creation by showcasing the unique angles that could be captured using their mountable cameras.

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The slogan for GoPro from the launch of their brand has been “be the hero”. Through videos posted on the official company page they demonstrated the quality of edits that now every athlete had the means of producing. They went about proving that this level of production could be achieved by anyone by sponsoring the USC Ski Team who came out with videos on a regular basis shot exclusively on GoPros.

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USC was just the starting point for the progression of GoPro’s business to client relationship. They moved beyond exclusive sponsorships and began looking to users of the product to generate a large portion of their posted content. GoPro’s Facebook page and Instagram both have a respective photo and video of the day section in which one user video and one user photo are selected from daily submissions and the winner is broadcasted/posted on the official company page. This not only creates exposure for the athletes involved it also generates a huge amount of traffic to the site and thereby exposure for GoPro. Users exchange notes on settings used in winning photos and this fosters a community of committed, interested users loyal to the brand and all at very little expense to GoPro.

Recently, Dodge ran a series of ads  for the release of next year’s Durango SUV. The ads were run on conventional TV stations and also uploaded to YouTube as most large companies now do. The campaign was run in conjunction with Paramount Studios to promote Will Ferrell’s upcoming film “Anchorman 2”, which is scheduled to be released this December. It’s an unconventional pairing that resulted in some memorable ads, some of which are nearing the 1 million view mark on YouTube, but who really benefitted from this joint venture.

It would be safe to speculate that Dodge fronted the majority of the bill for these ads, the talent (Will Ferrell), has already done numerous promotions for Anchorman 2 and on top of this the original Anchorman was a highly successful film that in many respects elevated Farrell’s career to new heights. But is having Will Ferrell on board to advertise the 2014 Durango worth its weight in revenues? It’s hilarious to hear Ferrell’s character Ron Burgundy speaking about the Durango’s glove box but what message is being sent to consumers about the vehicle?  As one viewer commented: “Is it safe to assume I can fit one turkey sandwich and 35 packs of gum?”, unlikely the sort of dialogue Dodge intended. Yes, it has been proven men in the demographic between ages 18-30 respond to humour in marketing (see Kraft’s “Mio” campaign and Old Spice’s “Smell Like a Man” campaign) but I would argue that in this case they are responding to Paramount’s advertising rather than Dodge’s. People are more excited that Ron Burgundy is back in action than they are about Dodge releasing the 2014 Durango model. The exposure is there but the message gets lost in the Ferrell’s funny-as-always razzle-dazzle.