welcome back to segment two of the show now we’re going to talk a little bit
now we’re going to talk a little bit
now we’re going to talk a little bit about scale and reach you always hear
about scale and reach you always hear
about scale and reach you always hear marketers looking for scale and reach
marketers looking for scale and reach
marketers looking for scale and reach and that usually means that so long as
and that usually means that so long as
and that usually means that so long as you have more users and you reach more
you have more users and you reach more
you have more users and you reach more viewers that advertisers will be happy
viewers that advertisers will be happy
viewers that advertisers will be happy but I think now that there’s a sort of
but I think now that there’s a sort of
but I think now that there’s a sort of realize I realization with AOL and Yahoo
realize I realization with AOL and Yahoo
realize I realization with AOL and Yahoo that they could have all this audience
that they could have all this audience
that they could have all this audience and all this reach but what does that
and all this reach but what does that
and all this reach but what does that reach actually represent so let’s start
reach actually represent so let’s start
reach actually represent so let’s start off with a bit of a theoretical question
off with a bit of a theoretical question
off with a bit of a theoretical question which is do the laws of does the law of
which is do the laws of does the law of
which is do the laws of does the law of diminishing return also apply to reach
diminishing return also apply to reach
diminishing return also apply to reach and scale with regards to advertising
and scale with regards to advertising
and scale with regards to advertising well I think to an extent it has to
well I think to an extent it has to
well I think to an extent it has to apply across the board in just about
apply across the board in just about
apply across the board in just about every industry as sooner or later you’re
every industry as sooner or later you’re
every industry as sooner or later you’re your overhead or the cost of servicing
your overhead or the cost of servicing
your overhead or the cost of servicing all your reach is just going to hell
all your reach is just going to hell
all your reach is just going to hell weigh the benefits and you’ve got to
weigh the benefits and you’ve got to
weigh the benefits and you’ve got to look at either expanding your scope or
look at either expanding your scope or
look at either expanding your scope or reducing your scale it’s interesting you
reducing your scale it’s interesting you
reducing your scale it’s interesting you look at this from the cost perspective
look at this from the cost perspective
look at this from the cost perspective you’re right that’s servicing you know
you’re right that’s servicing you know
you’re right that’s servicing you know serving up I mean myspace is losing
serving up I mean myspace is losing
serving up I mean myspace is losing apparently hundreds of millions of
apparently hundreds of millions of
apparently hundreds of millions of dollars each year it’s not just because
dollars each year it’s not just because
dollars each year it’s not just because of the headcount it’s because of all the
of the headcount it’s because of all the
of the headcount it’s because of all the server and infrastructure that they need
server and infrastructure that they need
server and infrastructure that they need to maintain those pageviews the reason
to maintain those pageviews the reason
to maintain those pageviews the reason why those pages are maybe not profitable
why those pages are maybe not profitable
why those pages are maybe not profitable is because a lot of it is is
is because a lot of it is is
is because a lot of it is is user-generated content or pirated
user-generated content or pirated
user-generated content or pirated content Yahoo supposedly is largely
content Yahoo supposedly is largely
content Yahoo supposedly is largely professionally produced content they
professionally produced content they
professionally produced content they have the rights to I think the issue is
have the rights to I think the issue is
have the rights to I think the issue is mainly that take a look at what’s
mainly that take a look at what’s
mainly that take a look at what’s happening with facebook facebook last
happening with facebook facebook last
happening with facebook facebook last year when they decided to raise fifty
year when they decided to raise fifty
year when they decided to raise fifty billion dollars through goldman sachs
billion dollars through goldman sachs
billion dollars through goldman sachs they said that they were going to do
they said that they were going to do
they said that they were going to do about 2.2 to 2.7 billion dollars of
about 2.2 to 2.7 billion dollars of
about 2.2 to 2.7 billion dollars of revenue from advertising it now turns
revenue from advertising it now turns
revenue from advertising it now turns out that even though that they’re
out that even though that they’re
out that even though that they’re killing it they’re actually missing that
killing it they’re actually missing that
killing it they’re actually missing that projection like twenty-five percent I
projection like twenty-five percent I
projection like twenty-five percent I think the theory has been that AOL and
think the theory has been that AOL and
think the theory has been that AOL and Yahoo the portals are doomed because
Yahoo the portals are doomed because
Yahoo the portals are doomed because people are move it like we’re moving
people are move it like we’re moving
people are move it like we’re moving away from portal them right moving now
away from portal them right moving now
away from portal them right moving now to a world where you get your news from
to a world where you get your news from
to a world where you get your news from Twitter on Facebook so i think the
Twitter on Facebook so i think the
Twitter on Facebook so i think the conventional wisdom was the reason why
conventional wisdom was the reason why
conventional wisdom was the reason why AOL and yahoo are dying is because
AOL and yahoo are dying is because
AOL and yahoo are dying is because facebook is posing a threat but now you
facebook is posing a threat but now you
facebook is posing a threat but now you realize that even though Facebook does
realize that even though Facebook does
realize that even though Facebook does 750 + million users they’re not really
750 + million users they’re not really
750 + million users they’re not really monetizing the way that they should you
monetizing the way that they should you
monetizing the way that they should you would think with that user base they
would think with that user base they
would think with that user base they would be generating 5 10 billion in
would be generating 5 10 billion in
would be generating 5 10 billion in advertising already under or not well I
advertising already under or not well I
advertising already under or not well I think Facebook is a completely different
think Facebook is a completely different
think Facebook is a completely different beast than it in like yahoo or AOL the
beast than it in like yahoo or AOL the
beast than it in like yahoo or AOL the way they’re trying to monetize is
way they’re trying to monetize is
way they’re trying to monetize is they’re trying to actually monetize
they’re trying to actually monetize
they’re trying to actually monetize social interaction as opposed to just
social interaction as opposed to just
social interaction as opposed to just straight-up content no one’s really
straight-up content no one’s really
straight-up content no one’s really figured out the best way to do that yet
figured out the best way to do that yet
figured out the best way to do that yet we’ve seen people play with in a lot of
we’ve seen people play with in a lot of
we’ve seen people play with in a lot of different ways of Facebook
different ways of Facebook
different ways of Facebook from you know hyper targeted ads based
from you know hyper targeted ads based
from you know hyper targeted ads based on my user demographic and social book
on my user demographic and social book
on my user demographic and social book graph right down to sponsored stories
graph right down to sponsored stories
graph right down to sponsored stories that they shove into my stream but at
that they shove into my stream but at
that they shove into my stream but at the end of the day these are all new
the end of the day these are all new
the end of the day these are all new ideas no one’s played with this before
ideas no one’s played with this before
ideas no one’s played with this before and I don’t think that Facebook is
and I don’t think that Facebook is
and I don’t think that Facebook is missing its projections because of them
missing its projections because of them
missing its projections because of them you know suffering from economies of
you know suffering from economies of
you know suffering from economies of scale I think they’re hitting they’re
scale I think they’re hitting they’re
scale I think they’re hitting they’re missing their projections because
missing their projections because
missing their projections because product development is taking a little
product development is taking a little
product development is taking a little bit longer and again they haven’t even
bit longer and again they haven’t even
bit longer and again they haven’t even started pushing aggressively into a
started pushing aggressively into a
started pushing aggressively into a mobile see I don’t want to be like a
mobile see I don’t want to be like a
mobile see I don’t want to be like a bear on facebook but I just like call BS
bear on facebook but I just like call BS
bear on facebook but I just like call BS on all the hype I think Facebook is
on all the hype I think Facebook is
on all the hype I think Facebook is fantastic their growth has been nothing
fantastic their growth has been nothing
fantastic their growth has been nothing but impressive but you know when you
but impressive but you know when you
but impressive but you know when you look at Google everybody’s like oh my
look at Google everybody’s like oh my
look at Google everybody’s like oh my god facebook social is going to kill
god facebook social is going to kill
god facebook social is going to kill search and Facebook is going to kill
search and Facebook is going to kill
search and Facebook is going to kill Google I go hold on not so fast why when
Google I go hold on not so fast why when
Google I go hold on not so fast why when I search for something and there’s a
I search for something and there’s a
I search for something and there’s a text you know paid text link that is
text you know paid text link that is
text you know paid text link that is actually valuable you know at least
actually valuable you know at least
actually valuable you know at least fifty percent of the time sometimes that
fifty percent of the time sometimes that
fifty percent of the time sometimes that paid advertisement has the info on
paid advertisement has the info on
paid advertisement has the info on looking for with facebook I mean they’re
looking for with facebook I mean they’re
looking for with facebook I mean they’re Janning 5 ad impressions per page I
Janning 5 ad impressions per page I
Janning 5 ad impressions per page I never look at the ads I think this is
never look at the ads I think this is
never look at the ads I think this is the biggest sort of obstacle if Facebook
the biggest sort of obstacle if Facebook
the biggest sort of obstacle if Facebook really wants to kill Google they need to
really wants to kill Google they need to
really wants to kill Google they need to come up with a add product that the
come up with a add product that the
come up with a add product that the users actually want do you ever look at
users actually want do you ever look at
users actually want do you ever look at the ads on Facebook no I really look at
the ads on Facebook no I really look at
the ads on Facebook no I really look at the ad on google and you do raise a good
the ad on google and you do raise a good
the ad on google and you do raise a good point the sensor on Google I sometimes
point the sensor on Google I sometimes
point the sensor on Google I sometimes look at them and but you can’t really
look at them and but you can’t really
look at them and but you can’t really compare the two because we’d searched
compare the two because we’d searched
compare the two because we’d searched all the ads are intentionally targeted
all the ads are intentionally targeted
all the ads are intentionally targeted I’m actively looking for something
I’m actively looking for something
I’m actively looking for something whereas Google might be able to
whereas Google might be able to
whereas Google might be able to completely sorry Facebook might be able
completely sorry Facebook might be able
completely sorry Facebook might be able to completely read my mind and show me
to completely read my mind and show me
to completely read my mind and show me an ad for something I’m kind of
an ad for something I’m kind of
an ad for something I’m kind of interested in but if I’m not in a like
interested in but if I’m not in a like
interested in but if I’m not in a like purchasing mindset which I’m in when I’m
purchasing mindset which I’m in when I’m
purchasing mindset which I’m in when I’m actually searching for something I’m not
actually searching for something I’m not
actually searching for something I’m not going to pay attention and that’s what I
going to pay attention and that’s what I
going to pay attention and that’s what I mean is that I don’t think Facebook has
mean is that I don’t think Facebook has
mean is that I don’t think Facebook has found yet found the magic formula on how
found yet found the magic formula on how
found yet found the magic formula on how to put the ads in there we’re still
to put the ads in there we’re still
to put the ads in there we’re still evaluating them based on like something
evaluating them based on like something
evaluating them based on like something that’s more along the lines of a
that’s more along the lines of a
that’s more along the lines of a conventional CPC or impression at when
conventional CPC or impression at when
conventional CPC or impression at when in actuality it’s probably going to be
in actuality it’s probably going to be
in actuality it’s probably going to be more along the kinds of integrated
more along the kinds of integrated
more along the kinds of integrated marketing that you see inside your
marketing that you see inside your
marketing that you see inside your friend fee but you really want to get
friend fee but you really want to get
friend fee but you really want to get commercial mess it’s very different when
commercial mess it’s very different when
commercial mess it’s very different when you’re searching for information you
you’re searching for information you
you’re searching for information you might have a commercial need but if I’m
might have a commercial need but if I’m
might have a commercial need but if I’m like sending a note to my brother or
like sending a note to my brother or
like sending a note to my brother or saying ayo to a friend hey was nice
saying ayo to a friend hey was nice
saying ayo to a friend hey was nice seeing you yesterday at the concert or
seeing you yesterday at the concert or
seeing you yesterday at the concert or whatever I don’t really think that
whatever I don’t really think that
whatever I don’t really think that there’s really that much room the
there’s really that much room the
there’s really that much room the majority of the time for a commerce
majority of the time for a commerce
majority of the time for a commerce introduction or relationship and that’s
introduction or relationship and that’s
introduction or relationship and that’s why I say they haven’t figured it out
why I say they haven’t figured it out
why I say they haven’t figured it out yet because you’re right you know when
yet because you’re right you know when
yet because you’re right you know when I’m just
I’m just
I’m just talking to someone about the concert
talking to someone about the concert
talking to someone about the concert last night I don’t necessarily want to
last night I don’t necessarily want to
last night I don’t necessarily want to be sold to but if they’re smart about it
be sold to but if they’re smart about it
be sold to but if they’re smart about it and they can get their semantic
and they can get their semantic
and they can get their semantic algorithm up to par stuff will appear my
algorithm up to par stuff will appear my
algorithm up to par stuff will appear my friend feed from let’s say brands whose
friend feed from let’s say brands whose
friend feed from let’s say brands whose pages I haven’t even liked do you think
pages I haven’t even liked do you think
pages I haven’t even liked do you think content is a solution I’m a big bowl
content is a solution I’m a big bowl
content is a solution I’m a big bowl obviously on content started watchmojo
obviously on content started watchmojo
obviously on content started watchmojo as a belief that content is king though
as a belief that content is king though
as a belief that content is king though without distribution it’s like the tree
without distribution it’s like the tree
without distribution it’s like the tree that falls in the forest who’s going to
that falls in the forest who’s going to
that falls in the forest who’s going to know about your piece of content but its
know about your piece of content but its
know about your piece of content but its content the solution like Google her
content the solution like Google her
content the solution like Google her face ok ok so Google has moved towards
face ok ok so Google has moved towards
face ok ok so Google has moved towards content right I don’t think the question
content right I don’t think the question
content right I don’t think the question of Google anymore is are they a media
of Google anymore is are they a media
of Google anymore is are they a media company the yes they are they on YouTube
company the yes they are they on YouTube
company the yes they are they on YouTube you know I think the acquisition of
you know I think the acquisition of
you know I think the acquisition of Zagat clearly is all about content local
Zagat clearly is all about content local
Zagat clearly is all about content local social and mobile but whether content is
social and mobile but whether content is
social and mobile but whether content is first or the fourth factor content will
first or the fourth factor content will
first or the fourth factor content will play a big part of that I think the
play a big part of that I think the
play a big part of that I think the question with Google now is is it even a
question with Google now is is it even a
question with Google now is is it even a Content company it doesn’t produce all
Content company it doesn’t produce all
Content company it doesn’t produce all that content on YouTube it has the
that content on YouTube it has the
that content on YouTube it has the rights to it but it will get more and
rights to it but it will get more and
rights to it but it will get more and more into originals Zagat clearly is
more into originals Zagat clearly is
more into originals Zagat clearly is original content so if is content the
original content so if is content the
original content so if is content the solution for maybe Google to get to the
solution for maybe Google to get to the
solution for maybe Google to get to the next sort of tier of revenue that they
next sort of tier of revenue that they
next sort of tier of revenue that they want and if and if contents not the
want and if and if contents not the
want and if and if contents not the solution for facebook what is for
solution for facebook what is for
solution for facebook what is for facebook okay well first start to start
facebook okay well first start to start
facebook okay well first start to start with Google I don’t think the solution
with Google I don’t think the solution
with Google I don’t think the solution is actually content per se they’re
is actually content per se they’re
is actually content per se they’re they’re not I don’t see them as a media
they’re not I don’t see them as a media
they’re not I don’t see them as a media company I don’t see them as a as a
company I don’t see them as a as a
company I don’t see them as a as a Content company I see them as an
Content company I see them as an
Content company I see them as an advertising company all they do is they
advertising company all they do is they
advertising company all they do is they acquire things to slap ads alongside and
acquire things to slap ads alongside and
acquire things to slap ads alongside and that’s primarily what their revenue
that’s primarily what their revenue
that’s primarily what their revenue revenue model is and they all those
revenue model is and they all those
revenue model is and they all those search drives ninety-nine percent of
search drives ninety-nine percent of
search drives ninety-nine percent of their there at advertising business
their there at advertising business
their there at advertising business local and all that stuff is still really
local and all that stuff is still really
local and all that stuff is still really knew the difference with Facebook is
knew the difference with Facebook is
knew the difference with Facebook is that well what’s the difference no but
that well what’s the difference no but
that well what’s the difference no but what’s real what’s the big difference
what’s real what’s the big difference
what’s real what’s the big difference between Facebook the difference between
between Facebook the difference between
between Facebook the difference between Facebook is they are the art typical
Facebook is they are the art typical
Facebook is they are the art typical problem you’ve seen in social networking
problem you’ve seen in social networking
problem you’ve seen in social networking which is you’re just assuming there’s a
which is you’re just assuming there’s a
which is you’re just assuming there’s a linear direct relationship between the
linear direct relationship between the
linear direct relationship between the growth and eyeballs and the growth in
growth and eyeballs and the growth in
growth and eyeballs and the growth in advertising and that’s just not the case
advertising and that’s just not the case
advertising and that’s just not the case and it will never be the case with
and it will never be the case with
and it will never be the case with social networking projections this is
social networking projections this is
social networking projections this is why by and large social networking
why by and large social networking
why by and large social networking advertising projections always got
advertising projections always got
advertising projections always got reduced downwards the only reason why
reduced downwards the only reason why
reduced downwards the only reason why they’re still growing though is just
they’re still growing though is just
they’re still growing though is just because facebook keeps growing so people
because facebook keeps growing so people
because facebook keeps growing so people assume that the number one play facebook
assume that the number one play facebook
assume that the number one play facebook in social networking will push social
in social networking will push social
in social networking will push social networking industry revenues up which i
networking industry revenues up which i
networking industry revenues up which i think is the false fact all right let’s
think is the false fact all right let’s
think is the false fact all right let’s take a break we’re going to come back
take a break we’re going to come back
take a break we’re going to come back lightning round for questions we’ll be
lightning round for questions we’ll be
lightning round for questions we’ll be right back
”
Be First to Comment