Exploring privacy December 5, 2009
Posted by Simeon Simeonov in Advertising.Tags: Better Advertising, FTC, online advertising, privacy
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The title of this post is also the title of the first of three public roundtable discussions by the FTC focused on privacy online.
The Federal Trade Commission will host a series of day-long public roundtable discussions to explore the privacy challenges posed by the vast array of 21st century technology and business practices that collect and use consumer data. Such practices include social networking, cloud computing, online behavioral advertising, mobile marketing, and the collection and use of information by retailers, data brokers, third-party applications, and other diverse businesses. The goal of the roundtables is to determine how best to protect consumer privacy while supporting beneficial uses of the information and technological innovation.
The first roundtable is on Monday in DC. The Better Advertising team will be there.
We believe that it is an opportune time for the online advertising industry to work with privacy groups and regulators to improve the mechanisms for engaging consumers and doing so in a transparent and trustworthy manner. It is our mission to facilitate this.
Dave Morgan knows this space well. He is CEO of Simulmedia and previously founded and ran TACODA (where I first met him) and Real Media. Dave has a piece in MediaPost that is a good ouline of some of the key issues. I recommend it.
Facebook – Google rivalry has Net at stake June 23, 2009
Posted by Simeon Simeonov in Facebook, Google.3 comments
I’m enjoying Net access on a Virgin flight to SF on FastIgnite and other business. While prepping for meetings with Thing Labs, Facebook and Mozilla I came across this Wired article on the mounting Facebook – Google rivalry. It’s a well-written piece that covers the historical context of the rivalry and speculates about Facebook’s plan for online domination:
- Get scale in usage and aggregated data
- Redefine search via the social graph
- Colonize the Web through Facebook Connect and OpenStream
- Sell targeted ads everywhere
It is clear that the two companies are on a collision course and will both look for help and leverage in the upcoming battle. Beyond the well-identified brand advertising + search + communication tools + social graph battle lines there are two that merit a bit more analysis and some wild guesses:
- The real-time Web is becoming more important. That’s why both went after Twitter and, of course, why Twitter rebuffed both. (Nothing like a horsy race, especially when you don’t need to exit. Yes, Twitter knows they have to manage hosting/traffic costs.) Now both FB and Google are busy adding capabilities around real-time content contribution/sharing/search.
- More general search. If FB is to redefine search, it needs to be able to handle a reasonably set of search queries. Google’s core technology and reach have an overwhelming advantage here. FB has great data but even at their scale it is very difficult to create a great user experience for search. People come to a search box with diverse intent. Therefore, intent discovery is one of the most important and hardest problems for a search engine to solve. Through its richer UI and tracking capabilities FB has an advantage is discovering intent. However, if the intent and/or the search query cannot be satisfied easily within the agregated dataset of friend activity there is a problem. Also there is the expert gap–my friends may not be the experts. Wild guess: Facebook may partner with Microsoft, which is eager to give Bing more momentum, or another search player to create a more compelling search experience within FB. Or they may really redefine search to establish a clear psychological contract with users about what FB search is all about. Either way, it will be interesting to watch.
- Desktop access. I was excited when Facebook acquired ParaKey. It was a brillian strategic move, Facebook’s Secret Plan v2.0. Desktop data and flexible offline access to online services is very important. Google clearly has the leadership now with Google Gears and Chrome. Google Apps help indirectly by moving the data to the cloud. I am disappointed that for two years we haven’t seen anything come out the Parakeyacquision. Blake Ross and Joe Hewitt are still at FB. Joe is doing some very cool work on the iPhone app and something secret (hopefully desktop-related). Blake’s been so busy he stopped paying his hosting fees.
Ultimately, the Net doesn’t want to be owned by anybody. We are witnessing the wearing off of Google’s goodwill as their hold on non-brand advertising solidifies. The same is likely to happen with Facebook if they aggregate tons more user data and continue to make it difficult to export/share/operate.
So, who’s going to balance out the power of Facebook and Google? One obvious answer is Microsoft. As the underdog in the online space, the company will be willing to play by new rules. When threatened MS rallies and responds well. Well, at least they did. A lot of people have left. Next is perhaps an unlikely candidate–the Mozilla Foundation. With its significant browser share Mozilla has a huge role to play in the evolution of data ownership, privacy and advertising. In fact, this will be the topic of my conversation with CEO John Lilly tomorrow. Apple has a role to play.
About to land. Enough for now.
Polaris Digital Media Summit February 3, 2008
Posted by Simeon Simeonov in Digital Media, Google, Microsoft, Polaris Venture Partners, VC, Venture Capital, startups.add a comment
I spent the last few days in Deer Valley, UT at the annual Polaris Venture Partners Digital Media Summit or PVPDMS08 as we casually refer to it (right). It’s a great event where the CEOs of our digital media companies mix with industry heavies, both successful startup entrepreneur types and the folks with multi-billion dollar budgets. A few days of focused round table discussions, good food and fun physical activities are the best way to build relationships. It’s one of the many ways the Polaris network helps our entrepreneurs.
The weather this year was both great and marginal. Deer Valley got about 55-60” of snow in four days. The powder made the skiers happy. Those of us who don’t do the downhill thing went snowmobiling. We had a good time although snowfall killed the visibility as you can see on the pic. On the flip side, getting to dinners with the road closings was a challenge and today a few attendees narrowly escaped an avalanche at Deer Valley Resort.
We covered many important topics: from how to build organizations in digital media startups and scale infrastructure, to new content & advertising models, to monetization of UGC and other forms of social media, etc. Many of the comments were insightful due to the diversity of backgrounds and perspectives around the table. I have a few good follow-on topics for blogging that I hope to organize and post in the next few weeks.
On Friday the group was abuzz following the news of the Microsoft offer to buy Yahoo. Several of the attendees had stayed up overnight and were prepping for board calls and press interviews. Microsoft does best when someone is breathing down its neck. I hope the same is true for Google.
The Science of Viral Marketing November 30, 2007
Posted by Simeon Simeonov in Social Commerce.6 comments
While it is fun to throw about theories about what works and what doesn’t in viral marketing, the fact is that there is precious little public analysis about online behavior in the face of social economic incentives.
The most detailed analysis I’ve been able to find is “The Dynamics of Viral Marketing“, which looked at real data from an e-commerce site that provided a simple incentive–recommend what you’ve bought and you + the first person who buys off your recommendation get 10% off.
We present an analysis of a person-to-person recommendation network, consisting of 4 million people who made 16 million recommendations on half a
million products. We observe the propagation of recommendations and the cascade sizes, which we explain by a simple stochastic model. We analyze how user behavior varies within user communities defined by a recommendation network. Product purchases follow a ’long tail’ where a significant share of purchases belongs to rarely sold items. We establish how the recommendation network grows over time and how effective it is from the viewpoint of the sender and receiver of the recommendations. While on average recommendations are not very effective at inducing purchases and do not spread very far, we present a
model that successfully identifies communities, product and pricing categories for which viral marketing seems to be very effective.
The great thing about the analysis is that the data set extends to three major categories (books, CDs, DVDs and videos) with lots of buyers over two years. The researchers draw some interesting conclusions, including the observation that “purchases that resulted from recommendations are just a drop in the bucket of sales that occur through the website”.
Reading the analysis it becomes clear that the etailer did a poor job of setting up a successful social incentive system and of providing the tools to let consumers take advantage of it. For example:
- By not imposing limits on the number of recommendations that could be sent out they allowed some people to become spammers, which negatively affected conversion for the recipients, even as far as other senders were concerned. No surprise here–by analogy, email spam has reduced the effectiveness of email as a marketing medium for everyone.
- By having a one-size-fits-all incentive system, the etailer did not take advantage of the fact that the dynamics of viral distribution vary by product category and price range. Imagine picking a simple marketing strategy and putting it in place for two years without change and without any A/B testing. No, that’s not how things should be done.
- The etailer provided no tools to help viral spreading beyond the ability to email people with a recommendation. No profiles, recommendation lists, interest groups, checkout notifications, recommendation-based cross-selling, etc.
To make effective use millions of distribution channels, e-commerce sites need to think systematically about social commerce. They need a strategy first. Then they need to realize that implementing a successful social commerce system will require investment not unlike that required to build any major part of their site.
