Archive for December, 2011

Reasons why Marketers can’t trust Facebook

This article first appeared in iMedia this year but a recent incident made me re-produce it here for our audience. I was recently approached by a friend in an Indian coporate training company in Delhi. She asked me as to how she can update her company pages on facebook and LinkedIn which were actually made by some ex-employee of that company. Thus, I would like to pen a few of the reasons from the original article about why Businesses can’t trust Facebook. I am quite sure some, if not all of our audience would be able to relate to examples below readily. I would also appreciate if you can share your thoughts and comments in response to this post.

A broken hierarchy

Lesson 1: The hierarchy of control over Facebook pages is broken.

All Facebook pages are assigned directly to Facebook users. In other words, the fate of your company’s Facebook page is in the hands of the person who added it. That’s extremely short-sighted and that’s what happened with my friend’s company pages too. Aside from sole proprietors, most companies don’t belong to a single person. Since you’re not allowed to register a non-human on Facebook, you’re forced to have it under an employee.

What happens when that employee leaves? We’ve already seen how difficult it is to get back control of a lost Facebook page. It can take a long time, may require some legal wrangling, and will required that person adding another person on the staff as an administrator.

You might think the solution would be to have multiple administrators on your staff or with the agency you might be working with. Wrong.

When Facebook sees suspicious activity on its Facebook pages, it disables every administrator’s account. That, in turn, would disable the account of the current person dealing with the issue. And, that, in turn, would disable all of his/ her personal pages too and applications.

Loss of control

Lesson 2: You do not have any control over Facebook.

Aside from not knowing what might invoke Facebook’s account disablement, there are other factors you don’t have control over. When Facebook changes its layout, you have to fix it. When Facebook is broken, you can’t fix it. When Facebook changes its application programming interface, you have to reprogram yours.

An additional hole in Facebook’s use is that you can tag anyone or any business on any place or in a status update, and that entity is notified. Some of my friends do this to notify me of a video, photo, or site they want me to look at. It’s annoying. If I’m tagged, I should have the opportunity to review and approve that tag before it goes public.

Lack of recourse

Lesson 3: You do not have any recourse with Facebook.

The road to get your account re-enabled is a black hole. You’re asked to submit a form requesting your account be re-enabled; however, you’re not provided any support, any timeline, or any guarantee that it will be turned back on.

Imagine that! All of your work, your content, your fans, your pages, and your applications, all gone at the blink of an eye — with no recourse for your business. Companies spend thousands on Facebook Ads to grow the following on a few of their pages — and all of it’s gone when the account is disabled. When account is finally re-enabled (with no communication from Facebook), republishing of all of pages is required.

Imagine if you had built an application and utilized Facebook’s log-in API so that users of the application could log in with their Facebook ID. That application would be totally out of service.

Per its terms of service, Facebook can also remove your ads for any reason:

We may reject or remove any ad for any reason.

Lesson 4: Facebook has rights to all of your content.

Posting videos? Music? Photos? Did you read this in the fine print on Facebook?

You grant us a non-exclusive, transferable, sub-licensable, royalty-free, worldwide license to use any IP content that you post on or in connection with Facebook.

Wow. When your company spends thousands of hours on a new campaign that goes viral, it’s nice to know that Facebook can use that content however it would like. Kind of scary.

Lost applications; changing terms

Lesson 5: Almost everything you invest in Facebook could be lost. Today.

Facebook advertising and applications have done quite well for many companies. The problem is that some companies are literally built with Facebook as the sole foundation of the consulting, products, and services they provide. This is known in the technology industry as a “single point of failure,” and it makes your business totally susceptible to Facebook.

Have you worked for a year to build content and a following? That’s worth no more than $100 to Facebook:

WE WILL NOT BE LIABLE TO YOU FOR ANY LOST PROFITS OR OTHER CONSEQUENTIAL, SPECIAL, INDIRECT, OR INCIDENTAL DAMAGES ARISING OUT OF OR IN CONNECTION WITH THIS STATEMENT OR FACEBOOK, EVEN IF WE HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. OUR AGGREGATE LIABILITY ARISING OUT OF THIS STATEMENT OR FACEBOOK WILL NOT EXCEED THE GREATER OF ONE HUNDRED DOLLARS ($100) OR THE AMOUNT YOU HAVE PAID US IN THE PAST TWELVE MONTHS.

Lesson 6: Just because you understand the terms today doesn’t mean that Facebook won’t change them tomorrow.

Kurt Opsahl of the Electronic Frontier Foundation has chronicled Facebook’s privacy changes alone:

Facebook privacy policy circa 2005: No personal information that you submit to Thefacebook will be available to any user of the Web Site who does not belong to at least one of the groups specified by you in your privacy settings.

It includes iterations from 2006, 2007, November 2009, December 2009, and culminates with this:

Current Facebook privacy policy, as of April 2010: When you connect with an application or website it will have access to General Information about you. The term General Information includes your and your friends’ names, profile pictures, gender, user IDs, connections, and any content shared using the Everyone privacy setting. … The default privacy setting for certain types of information you post on Facebook is set to “everyone.” … Because it takes two to connect, your privacy settings only control who can see the connection on your profile page. If you are uncomfortable with the connection being publicly available, you should consider removing (or not making) the connection.

Content access

Lesson 7: Facebook owns access to your content.

Facebook might state that you own your content, but the fact that it owns access to it puts your business dead in the water when it’s not available.

Most of us don’t see Facebook doing anything wrong by dominating the internet. Since it’s a freeplatform, we generally don’t have any legal recourse, either. While we aren’t paying for Facebook in dollars and cents, we are paying for it by risking our privacy and information and  handing over our content — and now our businesses — to a company that can turn us off with the flick of the wrist.

A couple of months ago, Facebook opened up your profile a bit further by enabling developers to directly access your mobile phone and your address. Did you know that? Would you have joined Facebook had you known they were going to sell your data, exploit your content, and make billions of dollars all while being able to shut off your access at its own discretion?

Is this the Facebook you joined? It wasn’t the one that I did.

Are you willing to bet your business on Facebook and the numerous risks that come with it? My own response at this point would be, “Absolutely not!” We should all be skeptical of businesses that own so much of the market that they can destroy the competition or even their own customers without even flinching.

If Facebook is your primary means of generating traffic and revenue, begin diversifying your investment in other strategies as well. We insist that our clients use Twitter, invest in search, develop their own blogging strategies, and own their own content on their own domains. You should too.

December 22nd, 2011

10 Digital Measurement Predictions for 2012

(This article was first produced on iMedia by Scot Wheeler)

Once again, ‘tis the season for predictions. My list of 10 predictions for 2012 follows, but before that I’d like to briefly explain how Scot arrived at the predictions below.

Background

2008 and 2009 were the first two years that saw business really began to take social media seriously, so the theme for that time really was just “what should I be doing and how should I do it?”

These were the years in which social media strategies began to emerge, and businesses began to build out their presence on the major social networks.

In 2009 and 2010, companies who had invested in getting their social media approaches up and running began to look for ways to develop focus and evaluate results. The listening platform industry, led by Radian6, grew rapidly to meet this need. During this time, social media measurement became all about volumes of conversation, sentiment of conversation, key topics of conversation and as the holy grail, influencer identification.

2010 saw the more widespread adoption of Facebook insights, and the corresponding emergence of the “direction, volumes and mash-up metrics” (such as Klout) school of measurement to supplement the limitations of listening platforms’ ability to also evaluate quality and impact of engagement across major social networks.

Even with reporting on volumes and tone of conversation, growth in likes, views, followers, retweets and the like, and changes in company Klout score or another such “proprietary” metrics, as we entered 2011, company management was still asking its digital teams what social media was really doing for the business. Thus 2011 became the year of “social media ROI”.

Suffice it to say that this focus on ROI, though a logical culmination of several years of management questions around the value of social media, misses some of the most valuable aspects of social media.

Limited Focus
Because many digital teams that now work in social media have traditionally had the ability to measure their work in terms of direct referrals by running segmented analysis on unique visitors’ paths to online conversion, these teams may over-rely on direct attribution or referral to some conversion outcome (leads or sales) as the best method for measuring their work in social media.

While I certainly appreciate and support the commitment to measurement shown by these teams, I am afraid that this approach can nevertheless devalue very important factors in driving market share, purchase consideration, retention and loyalty. When the measurement of value is just about direct contribution to sales (as it is in most ROI models), the value of contributing to factors such as awareness, affinity, trust, satisfaction and endorsement can get lost.

Predictions
Specifically because social media – along with much of the mobile experience and the customer servicing side of websites – is all about affinity, trust, satisfaction and endorsement, I predict that in 2012:

1. Reality will bite back on 2011’s heavy focus on social media measurement that focuses almost exclusively on ROI.

2. In the coming year, smart companies will stop wondering if social & mobile have value, and will simply accept that these are now fundamental channels in the marketing mix.

3. Smart companies will understand that of course social and mobile can contribute to their marketing efforts, and probably in ways that can’t always be measured in direct financial contribution.

4. To find these points of value-adding engagement, measurement of social and mobile will begin to evolve to focus on finding and valuing the supporting contributions of social media to brand affinity and purchase decisions.

5. As such, social and mobile engagement will need to be considered with all other marketing channels in marketing mix modeling and evaluation, and these models will need to be refined to consider a ratio of impact to investment that differs from traditional channels.

6. To maximize this impact, measurement and techniques for real-time optimization of social media engagement will begin to be developed and utilized by leading firms.

7. For this to happen, smart businesses will begin to sit down and think realistically about what expectations they can have around social media.

8. As a result of these conversations, expectations around direct sales contributions will begin to recede (though not disappear), while more realistic expectations around awareness, endorsement, etc., take their place.

9. The lines between social, mobile and traditional web-based digital will begin to blur, as will operational silos around these. Social and mobile strategies will also continue to merge with television and print advertising.

10. Really smart companies, especially those with a strong capability or opportunity in providing ongoing value to customers digitally, will begin to see their end-to-end marketing mix as an integrated channel for inviting customers to engage in voluntary experience collaboration. They will need to organize themselves in order to really walk the walk.

December 19th, 2011

Facebook a new competitor for Google & inMobi in mobile advertising? But, can it compete???

Before I jump on the post on above topic, I will first give an example of where I got the idea of putting this post up here.

Last week, I happen to interact with Viren Bhandari of Inflavo of Poland who is planning to enter Indian market space with solutions like f-commerce, re-commerce and m-commerce. I told him that f-commerce is still not available in India as most companies who are trying to run facebook commerce are directing users to another site of theirs, for payments. To this, he said that when their clients take f-commerce solution, they automatically get option of directly loading their to be sold products from mobile to their f-commerce sites, which I feel is a great option. I am looking forward to his entry and his offering of these solutions in Indian market, which I feel many would like. This is far more than entrepreneurs, picturing an object, loading it to their sites on their pc, and then posting them to facebook.

With consumers increasingly using their mobile phones to access Facebook, the social media giant is reportedly readying its first mobile advertising initiative.

Many consider the combination of mobile and social media to be the Holy Grail of digital advertising. The news that Facebook will launch a mobile advertising strategy brings mobile, social media pairing much more into focus and follows closely on the heels of Twitter’s introduction of ads for its mobile apps.

Facebook is looking for ways to monetize its huge base of users. Advertising is probably the best option because many of the people who use mobile social networks fall into younger age demographics and are comfortable with accessing content on a free basis and generally are quite difficult to reach through more traditional advertising channels.

Facebook could certainly be a strong player in mobile advertising and has the potential to make significant revenues from mobile advertising.

Taking on Google and InMobi of Indian origin
Given the significant size of Facebook’s user base – with numbers of 800 million users and 350 million mobile users – an advertising play makes sense for the company.

Reports began surfacing this week that the social network giant will introduce a mobile advertising play by the end of March. This will put it into competition with Google and InMobi – the leaders in the space – although there may be enough room for all as growth continues at a brisk pace. This is a space that will be able to support multiple payers for the next few years ahead.

Another mobile advertising option also makes an already complex ecosystem even more so from a marketer’s point of view. There are already lots of players offering different solutions and this causes complexity for advertisers.

EMarketer estimates Facebook will earn $3.8 billion worldwide this year in advertising revenue, up 104 percent from $1.86 billion in 2010. However, Facebook’s ad revenues have been hampered by marketers belief that the ads are not effective at driving clicks and that they can engage consumers on Facebook without the need to pay for advertising. A mobile advertising play could help Facebook drive further growth from advertising.

In-app advertising
The benefit to advertisers in using Facebook could come from the substantial information the social network has on its users, which could be used to help advertisers target potential customers. The big advantage of Facebook is that it could provide one of the missing pieces of mobile advertising which is targeting. Mobile advertising has struggled to become a major platform because of the issue of relevancy. Facebook has very detailed information on it users that could help advertisers reach their desired audiences – this would be a major advantage.

However, Facebook would need to tread carefully with how it approaches the use of customer data because privacy advocates and regulators are keeping a watchful eye on mobile’s data collection practices.

In-app advertising is one potential area of opportunity for Facebook.

Facebook recently revamped its app for Android to make it quicker and easier to use as it looks to attract more developers. Thus, Facebook is in quite a strong position to become a strong distribution channel for mobile apps & this would offer a chance to do in-app advertising.

December 17th, 2011

Is e-commerce boom already in India? Probably not…

Google, India, Rajan, Anandan, Google India Managing Director Rajan Anandan gave a fascinating talk to a Geeks on a Plane India group this week, giving a snap shot of the data that is driving the consumers, entrepreneurs, trends and investors in the rapidly growing Indian web and mobile markets.

Anandan says: “We’re probably in 1996 in the U.S. in terms of the Internet market in India.” Here’s the stats from Anandan’s deck accompanied with some comments from me in brackets. India has:

  • 1.2 billion people
  • The 9th largest economy in the world, with $1.7 trillion GDP
  • 600 million people below the age of 25
  • 22 languages
  • 250 million in the consuming class — these are the folks that buy e-commerce
  • 900 million mobile accounts, with 600 million unique mobile subscribers (many people have more than one account)
  • 30 million PCs — it’ll be a mobile broadband world
  • Average revenue per user (ARPU) is $3
  • 100 million Internet users, and 120 million Internet users by the end of 2011 that’s about 10% population right now.
  • By 2015 there will be 300 million to 400 million Internet users that would still be about 10% of population then.
  • 37 percent of Internet users access the web from home, 27 percent from an Internet cafe, 22 percent from an office, 3 percent from school
  • There are 50 million mobile data subscribers
  • 5 million access Internet only on the phone but still most of them don”t buy through m-commerce
  • In 2010/2011 e-commerce emerged as a $7 billion market, with $6 billion of that going to online travel
  • By 2015 the e-commerce market is expected to be $40 billion (how will 47 e-commerce companies present in India right now survive until 2015? )
  • 67 percent of e-commerce customers buy electronics and cell phones. 18 percent buy apparel.
  • 15 million 3G mobile subscribers
  • Broadband is 250 kbps to 500 kpbs fixed line
  • The use of smart phones will grow 52 percent CAGR
  • There are 37 million Facebook users
  • Google Plus use is bigger than Twitter use
  • 23 million unique users on YouTube India
  • There will be $1.3 trillion in online ad spend in 2011
  • The English Internet will not scale beyond 200 million, says Anandan
  • 159 million read Hindi newspapers and 31 million read English newspapers
  • There will be a massive tsunami toward vernacular content on the web, says Anandan
  • 70 percent of non-travel e-commerce is “cash on delivery” (no online payments, buyers pay cash when goods are delivered)
  • This cash on delivery market has a 30 percent return rate
  • Web 1.0 and 2.0 are happening at the same time in India, says Anandan.

Some Internet sites that have found success in India:

Considering numbers above, anybody feeling that e-commerce is here and now and they will miss the boat if they don’t enter now can re-think as even if they start 1-2 yrs. down the line, they would be good as internet penetration is still low and more purchase is happening in COD mode than online mode. But, if people feel it would be good to have presence now online so that they are ready when actually penetration rises, then my personal suggestion would be to have enough cash to be able to sustain until then.

For some time, people willing to enter e-commerce have been asking us if they should have wapsite or an app, we have been advising them to have wapsite now and apps soon as in long run leaving either will be a wrong decision.

What do you think about e-commerce state in India? I would love to see your comments…

(via GigaOm)

December 15th, 2011

Indian e-commerce – nuances and challenges

Everybody and their grandma in India now knows that Indian e-commerce market is set to explode – it is expected to go from current 7 billion dollar (of which 6 billion is online travel alone) to 40 billion by 2015 – ie in 3-4 years.

In view of this, dozens of new ecommerce startups have launched in India and some of them are increasing market share at a breakneck speed. Some of these include Flipkart, Snapdeal, Exclusively.in, yebhi.com, babyoye.com, myntra.com and several others from large brands as well as startups.

But Indian ecommerce is not like that in the West – where online credit card payment and cheap shipping are the order of the day. India has presented these online commerce vendors with its own unique challenges – eg. :

  • COD : customers are reticent to use credit cards online. COD or Cash on Delivery is the preferred method for payment for most online sales.
  • Free Shipping : Indian online customers do not want to pay for shipping – as a result, Indian ecommerce vendors have to bite the bullet on shipping as well.
  • Categories for online shopping : Indian customers so far are mostly interested in online travel purchases – but when it comes to other products like toys, baby products, household items, books, music CDs and such, physical stores still take more than 99% of the customer pie. Of course, now electronics, books and apparel are some products gaining traction in online sales.
  • Where are the profits ? : Of course, it is well known that most India ecommerce startups are taking a loss on online sales – just to grow market share. One expects a market shakeout on this sooner or later and only the strongest (and well funded) ones will survive this fight to the top. We feel that the shakeout will begin to happen over the course of next year with several pulling the plug on their ventures or being bought out by other stronger ones.

Above list highlights some major challenges for the Indian ecommerce players. Enter Indian Jugaad – or Indian version of “make it work somehow“. New services like Gharpay and chottu.in have been launched to tackle the COD cash collection challenges, as well as product delivery in some cases. These services are building networks of collection agents in various circles or cities and provide Cash on delivery collection services as well as product delivery for the major vendors like Redbus.in, Myntra and Flipkart. Within months of launch, these services have signed  up many leading online vendors as customers.

Well – one has to admit – when it comes to India, it is all about “Jugaad Karo“. In India, if there is a problem, there is always a “Jugaad solution” lurking somewhere – it is upto creative entrepreneurs to find such gaps and exploit them to make new ventures.

December 14th, 2011

The Indian Web and Mobile Markets by the numbers

(excerpted from GigaOm Pro article at http://t.co/20B9JVyo)

Katie Fehrenbacher with Gigaom is traveling with Geeks on a Plane in India. She writes following stats provided by Google CEO Rajan Anandan to the Geeks on a Plane group :

Rajan Anandan on Indian internet scene : “We’re probably in 1996 in the U.S. in terms of the Internet market in India.”

Here’s the stats from Anandan’s deck. India has:

  • 1.2 billion people
  • The 9th largest economy in the world, with $1.7 trillion GDP
  • 600 million people below the age of 25
  • 22 languages
  • 250 million in the consuming class — these are the folks that buy e-commerce
  • 900 million mobile accounts, with 600 million unique mobile subscribers (many people have more than one account)
  • 30 million PCs — it’ll be a mobile broadband world
  • Average revenue per user (ARPU) is $3
  • 100 million Internet users, and 120 million Internet users by the end of 2011
  • By 2015 there will be 300 million to 400 million Internet users
  • 37 percent of Internet users access the web from home, 27 percent from an Internet cafe, 22 percent from an office, 3 percent from school
  • There are 50 million mobile data subscribers
  • 5 million access Internet only on the phone
  • In 2010/2011 e-commerce emerged as a $7 billion market, with $6 billion of that going to online travel
  • By 2015 the e-commerce market is expected to be $40 billion
  • 67 percent of e-commerce customers by electronics and cell phones. 18 percent buy apparel.
  • 15 million 3G mobile subscribers
  • Broadband is 250 kbps to 500 kpbs fixed line
  • The use of smart phones will grow 52 percent CAGR
  • There are 37 million Facebook users
  • Google Plus use is bigger than Twitter use
  • 23 million unique users on YouTube India
  • There will be $1.3 trillion in online ad spend in 2011
  • The English Internet will not scale beyond 200 million, says Anandan
  • 159 million read Hindi newspapers and 31 million read English newspapers
  • There will be a massive tsunami toward vernacular content on the web, says Anandan
  • 70 percent of non-travel e-commerce is “cash on delivery” (no online payments, buyers pay cash when goods are delivered)
  • This cash on delivery market has a 30 percent return rate
  • Web 1.0 and 2.0 are happening at the same time in India, says Anandan.

Some Internet sites that have found success in India:

Thanks to Gigaom for the above post.

December 14th, 2011

Book Review : “India Inside : The Emerging Innovation Challenge to the West” by Nirmalya Kumar and Phanish Puranam

“India Inside : The Emerging Innovation Challenge to the West” is a new book authored by Nirmalya Kumar and Phanish Puranam, renowned professors at the elite London Business School. The book is published by Harvard Business Review Press and released in Nov 2011.

This book is about the “invisible” innovation which India today provides to a multitude of corporations and entities around the world. The book starts with questions like “Where are the Indian Googles, iPods and Viagras?” and “Can Indians innovate?”. Valid questions but which make slight of the fact that innovation is much more than consumer facing direct innovation. Indian ingenuity is enmeshed in so many products other multinationals make – likes of GE, Microsoft, IBM, AstraZeneca, Intel, Motorola and many others.

Globally Segmented Innovation :

As Western firms have outsourced large parts of the IT and research work to their Indian divisions and R&D labs, the skill profile of the Indian worker is increasing and firms are increasingly entrusting them with higher-end tasks. In this regard, the authors talk about the Skills Ladder concept – which says that when one creates an army of talent at the bottom of the product development pyramid, it is likely that innovation leaders emerge from this lot and remain in the geography where they are situated – as such, one can say that, thanks to Western outsourcing, a huge no of Indian engineers and innovators are being trained and are likely to boost the local innovation ecosystem via new entrepreneurial ventures or contributions to domestic economy.

In short, there is a talent shift to Asia from the Western hemisphere, which in turn will lead to accelerating growth and innovation in that part of the world.

Outsourced R&D :

For multinationals, Indian service providers like Wipro, Infosys, Tata and HCL are conducting outsourced R&D in labs all across India. Wipro pioneered the concept of outsourced R&D with it’s innovative Product Engineering Services division or PES starting way back in early 80s. Infosys products like Finacle and others like i-Flex have become global leaders in banking and finance. Outsourcing of R&D to India-based outfits creates talent pools in that part of the world and self-perpetuates further innovation and increased western investments.

Process Innovation – An Injection of Intelligence :

Indian call centers are often staffed with folks who are normally more qualified than a mundane call center job. This has caused the so called “injection of intelligence” into the mundane call center and BPO processes – processes which the Western world had written off as commoditized and boring. As a result, call center outsourcer 24/7 is injecting analytics-driven market intelligence into customer service calls and interactions – thereby increasing web / phone consumer loyalty and conversion rates. Higher qualified Indian talent is converting routine BPO processes into more strategic higher-value initiatives for western clients, thereby increasing ROI on outsourcing even more.

Management Innovation – The Global Delivery Model :

Infosys and other Indian IT firms have pioneered the global outsourcing and cost efficiencies which can be achieved in large projects. Saving costs and making the process faster, leaner and efficient is certainly innovation in it’s own right.

Visible Innovation – Frugal Engineering :

The emerging Asian middle class is known to demand and desire Western style products at cheaper cost. The Indian concept of “Jugaad” - or an ability to make do with less resources and still get things done, is now finding acceptance as a strategy in global Boardrooms. Tata Nano (and more recently Aakash tablet, I might add) are changing the debate of value vs cost. Developed markets are fascinated by Indian creations like Tata Nano and are studying such models closely to see how a quality mass market product can be developed at such a lower cost.

The authors also acknowledge the India’s innovation challenges eg slow bureaucracy, lack of infrastructure, lack of capital and population’s risk-averse nature. However, the Indian innovation train has started and few can turn the clock back now. As such, authors provide recommendations to both Indian and Western firms as to how to leverage or face the oncoming Indian innovation onslaught. We highly recommend this book to those who are interested in learning about the India’s growth and innovation story.

CellStrat Book Rating : **** (4 out of 5 stars)

December 1st, 2011


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