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Archives for September 2014

IAB Releases 3 Principles to Stop Online Ad Fraud

mouse click online advertising click fraudOnline ad fraud has been a big problem for brand advertisers for years, and now, the Interactive Advertising Bureau (IAB) has taken new steps to curb it.

Back in December of 2013, the IAB Traffic of Good Intent Task Force released a set of best practices to reduce exposure to online ad traffic fraud, and now, the IAB is expanding those efforts. This week, the IAB announced that the IAB Traffic of Good Intent Task Force has become the Anti-Fraud Working Group and will focus on eliminating fraud across the advertising industry.

As it’s first step, the Anti-Fraud Working Group released three principles that should be used to identify and eliminate fraudulent traffic (and the inventory it creates). In a press release, the IAB described these Anti-Fraud Principles as, “a series of three tenets meant to root poor-quality ad traffic out of the system once and for all.” The IAB explains that the Anti-Fraud Principles are just one step in the IAB Trustworthy Supply Chain Initiatives that will address challenges facing digital marketing today.

The three Anti-Fraud Principles focus on detection, identification, and transparency:

Principle 1: Fraud Detection

The IAB states that suppliers should be required to implement technological and business practices that identify ad bots and illegitimate human activity. Furthermore, suppliers must prevent that traffic from being sold to advertisers.

Principle 2: Source Identification

The IAB states that suppliers should provide assurances to buyers that the inventory they pay for is from legitimate sources. To do this, the IAB recommends providing the specific URL of each ad placement to the advertiser.

Principle 3: Process Transparency

The IAB states that suppliers should provide details of the business and technical processes they use to adhere to the first two principles.

The IAB has also created a taxonomy that provides definitions of key terms used in online advertising transactions, so advertisers and suppliers are using the same terms and understand the same things about anti-fraud. The IAB believes that by working together, advertisers and suppliers can eliminate online ad fraud throughout the digital supply chain.

Let’s face it, marketers need online ad fraud to go away or they’re wasting valuable budget dollars. The Anti-Fraud Principles are a step in the right direction, but as the Anti-Fraud Working Group knows, there is more work to be done. Let’s keep the conversation going so eliminating ad fraud remains a top priority.

Image: Karen Andrews

Tumblr Referrals Produce Highest Mobile Revenue Per Visit for Brands

tumblrTumblr referrals just got bumped up higher on many brands’ priority lists. The 2014 U.S. Mobile Benchmark Report from Adobe Digital Index was released this month, and Tumblr referrals were found to drive the highest revenue per visit (RPV) from mobile devices.

Driving $2.57 per visit generated to a retail site on tablets and $0.67 on smartphones, Tumblr outpaced Facebook which only drove $1.55 on tablet devices and $0.42 on smartphones. Both Twitter and Pinterest generated less than half the revenue per visit from smartphones as Facebook. However, Twitter outpaced Pinterest on revenue per visit from tablets coming in at just over $1.00 per visit while Pinterest came in at just under $1.00 per visit.

The story on PCs is a bit different. Revenue generated per visit from PCs was highest for Facebook followed by Pinterest, Twitter, and Tumblr, respectively.

Given the revenue per visit data, it’s important to determine where social networks’ referred traffic comes from. For Pinterest, 64% of referred traffic comes from mobile browsers. For Twitter, 62% of referrals come from tablets and smartphones.

Another interesting finding for brands from the Adobe report relates to content sharing. Today, personalized content sharing through email and text messaging is more than twice as popular than group sharing via social media (70% to 30%). The breakdown from the report shows how significantly things have changed between 2013 and 2014:

  • iMessage sharing is up 259% over 2013
  • Pinterest sharing is up 131% over 2013
  • Email sharing is up 5.2% over 2013
  • Facebook sharing is down 42.6% from 2013
  • URL link sharing is down 26.8% from 2013
  • Twitter sharing is down 22.6% from 2013

For brands, it’s particularly interesting to note the change in Facebook sharing. Given recent changes to Facebook’s algorithm that makes it very difficult for content published on Facebook Pages to appear organically in Facebook fans’ feeds, the drop in user sharing adds one more log to the fire that is causing brands to pull back on their Facebook focus. On the other hand, Pinterest sharing is soaring and Tumblr revenue per visit is higher. Bottom-line, Facebook might be the biggest, but it’s not necessarily the best when it comes to connecting your brand with consumer audiences, particularly mobile audiences.

Have you shifted money or time away from Facebook yet to focus on more niche marketing opportunities? Have you considered doing so? Leave a comment and share your thoughts.

You can follow the link at the beginning of this article to access the complete report with all of the details from Adobe.

Image: Josh James licensed CC BY 2.0

The Effect of Company Culture on Brand Image

company cultureWhich brand do you prefer as a consumer—Apple or Google? Which company would you rather work for as an employee—Apple or Google? Which company would you rather invest in as a shareholder—Apple or Google?

Are your answers to those questions the same or different? For many people, their answers will be different because we prioritize different factors when evaluating a brand as a consumer versus as an employee or investor.

As Google and Apple trade the top spot in the list of the most valuable global brands from year to year, both brands continue to enjoy positive brand reputations from most of their key stakeholders. However, all news hasn’t been good. Both companies have been in the news recently for having disproportionately high numbers of male executives, being intellectual property bullies, and compromising the security of consumers’ private information.

We can see what’s happening to these companies on the outside, and externally, they’re holding up just fine. But what is it like to work for these companies? Is the company culture at one company significantly better than the other?

Company culture can play a significant role in giving a business a competitive advantage in the marketplace, so evaluating the cultures of Google and Apple can give us a better perspective on how well these companies truly are positioned for the future.

Good.Co put together a culture analysis of the engineering teams at Apple vs. Google, and you might be surprised by some of the results. Considering how important the engineering teams are in terms of keeping both companies ahead of the innovation curve, it makes sense to compare and contrast the engineers and the cultures they work in each day.

According to the study, Apple engineers are more tolerant of stress than Google engineers. They also have greater social confidence, are more innovative, and more willing to take risks than Google engineers. On the other hand, Google engineers are more competitive, more collaborative, more empathetic, and more adaptable socially than Apple engineers.

Even more interesting is Good.Co’s analysis of the “group-level fit” of Apple and Google engineers. According to the analysis, Apple engineers are a better fit for Google’s company culture (66% fit to Google vs. 59% to Apple), and Google engineers are a better fit for Apple’s company culture (56% fit to Apple vs. 52% fit to Google).

Company culture can have a significant impact on business success. Imagine if one of these companies had a team of engineers who were a 100% fit for their company culture. Do you think the battle for first place in the annual list of the most valuable global brands would still be as close?

Are your employees the right fit for your company culture? How does your company culture affect your brand image for customers, employees, investors, and other key stakeholders? Invest the time and money into developing a company culture that effectively supports your brand promise or you’ll be missing a huge competitive advantage.

Image: DaVinciS

State of Inbound Marketing for Corporations in 2014

state of inbound 2014 hubspotThe fifth annual State of Inbound report was been released by HubSpot, and again, thousands of marketers from around the world report that inbound marketing is very effective for their companies. In fact, companies are increasing investments in inbound and they’re experiencing positive ROI from those initiatives.

Marketers report that in 2014, blogging has the most significant impact on performance. Respondents who have prioritized blogging are 13-times more likely to achieve positive ROI than marketers who have not prioritized it. Behind blogging, the top inbound marketing projects are SEO/organic search, content distribution/amplification, long-form/visual content creation, webinars, interactive content creation, online tools, product how-to videos, and premium trials.

Overall, inbound tactics have increased with 85% of marketers using inbound in 2014 while only 60% used it in 2013. In total, half of the marketers who responded to HubSpot’s survey in B2B, B2C, and nonprofit sectors ranked inbound as their number one lead source. However, inbound success does not come without overcoming some challenges. Marketers identified the following top marketing challenges in 2014:

  1. Proving the ROI of marketing activities
  2. Securing enough budget
  3. Managing websites
  4. Targeting content for an international audience
  5. Hiring top talent
  6. Training the team
  7. Finding an executive sponsor

Interestingly, six of the above challenges could be linked directly to manpower resources:

  1. Proving the ROI of marketing activities requires someone with the knowledge and ability to collect the right data, crunch the numbers, and interpret them correctly.
  2. Securing enough budget requires having money to pay the team that will create, publish, design, and share the content.
  3. Managing websites requires having people on hand who can make the necessary edits to keep the content flowing.
  4. Targeting content for an international audience requires team members who understand international markets and can manage the translation and publishing process on a daily basis.
  5. Hiring top talent represents a direct investment in manpower resources.
  6. Training the team requires investing in ensuring your team has the right knowledge and skills to maximize the ROI of your marketing efforts.

Bottom-line, a successful inbound marketing strategy requires budget, but to overcome inbound challenges, a significant amount of budget must be invested in the right manpower to support and execute the strategy.

For large companies with more than 1,000 employees, the top marketing priorities in 2014 are increasing the number of contacts/leads and converting those contacts/leads into customers. Not far behind on the priority list are proving the ROI of marketing activities, reaching relevant audiences, and increasing revenue derived from existing customers. Farther down on the priority list is reducing the cost of contacts/leads/customer acquisition.

It’s interesting to see that large companies are very focused on increasing leads and turning leads into customers but they’re less concerned with proving the ROI of the marketing tactics they use to get those leads or reducing the costs to get those leads ($27/inbound lead and $45/outbound lead for companies with more than 1,000 employees). According to the survey respondents (from both large and small companies), only 53% are measuring ROI. The report authors explain:

Marketers that measure inbound ROI are 17 times more likely to see the same or greater ROI over the previous year. It’s likely that selection bias is impacting the data. After all, higher performing marketers are more likely to measure results, thus they are more likely to drive growth. Nevertheless, there’s a strong correlation between simply measuring ROI and achieving it. Marketers that are not currently measuring ROI should begin immediately.

You can follow the link at the beginning of the article to download the complete 54-page report and 42 charts from HubSpot (contact information required for download).

Image: HubSpot

The 50-20 Principle of Brand Loyalty

grocery store cartsAll marketers know the 80-20 rule that tells us 80% of sales come from 20% of a business’ customers, but research from Epsilon and Wylei Research has introduced us to the 50-20 principle, which tells us that 50% of sales come from 20% of a brand’s customer base known as brand loyalists.

According to the study of U.S. consumers, brand loyalists consider price but they also consider a variety of other factors to determine their personal valuation of a brand’s product or service (e.g., availability, convenience, quality, etc.). As an industry gets more competitive, these “other” factors become more important in the purchase decision-making process, particularly if perceived value is low.

This is evident in the data provided in the Get to Know Your Loyalists report from Epsilon and Wylei Research, which shows the following percentages of U.S. consumers who claim to be loyal to the six retail sectors included in the survey:

  1. Financial service providers: 53% of consumers are brand loyalists
  2. Grocery retailers: 47% of consumers are brand loyalists
  3. Insurance: 43% of consumers are brand loyalists
  4. Travel: 36% of consumers are brand loyalists
  5. Clothing retailers: 34% of consumers are brand loyalists
  6. Consumer packaged goods: 29% of consumers are brand loyalists

The research also found that more than one in two brand loyalists are women (52%). These brand loyalists have above average household incomes and are between the ages of 35-54. This demographic profile of the majority of brand loyalists is the same for five of the six retail sectors studied. Only the retail sector varied. According to the study, most brand loyalists in the retail sector are still women with above average household incomes, but they are a bit younger (18-34 years old).

The report provides some insights as to why brand loyalty is more prevalent in some industries than others. For example, the financial services industry is one where consumers don’t often switch products or brands. It’s too much of a hassle to switch and often fees are incurred. On the other hand, the retail grocery industry often builds loyalty through specific loyalty programs. At the same time, consumers become accustomed to the location, store layout, and product selection at their preferred grocery stores. Again, switching to a new store is a hassle.

On the other hand, highly competitive industries see lower levels of brand loyalty. For example, despite having many loyalty programs, the travel industry has only 36% brand loyalty. Both the retail clothing  industry and the consumer packaged goods industry are highly competitive with many options for consumers to choose substitutes. Switching is easy and the rewards often outweigh the negatives.

Consider your consumers’ loyalty to your brand. Is it as strong as you think it is?

Image: Jesse Victor

LEGO Becomes the Biggest Toy Maker in the World

legosOn September 4, LEGO announced its revenue increased by 11% and net profits increased by 14% during the first six months of 2014, which means it surpassed the former leader, Mattel (the maker of Barbie).

How did a company that sells primarily one type of product—plastic bricks in a variety of colors, shapes, and sizes—topple Mattel? The short answer is the success of The LEGO Movie, which achieved box office sales over $469 million. Add the sales of The LEGO Movie merchandise, and you’ve got the making of a very good year for the company.

However, there is more to LEGO’s recent success than a single movie (although that movie’s role in the company’s success is huge).

A focused brand is a strong brand, and LEGO has never lost focus. It’s actually surprising that the company waited so long to expand the brand into movies and related merchandise at this scale. It’s also surprising that the company waited so long to develop toy lines for girls. Although its initial release of the LEGO Friends for Girls line wasn’t perfect, at least it gave options to girls whose parents dragged them into the LEGO Store so their brothers could buy something (my daughter was one of those girls).

LEGO’s focus enables it to operate with comfortable profit margins. According to Mark J. Miller at BrandChannel, “LEGO’s profit margin has been more than 20% in the last four years and 24% earlier this year, while Hasbro’s is down to 4% and Mattel’s is barely breaking even.”

At the same time, LEGO has been making very good licensing decisions. From Star Wars and Lord of the Rings to Marvel and DC Universe Super Heroes, there are LEGO sets that consumers of all ages enjoy. However, LEGO has finally struck gold with its LEGO Movie line. The popularity of the movie has attracted a broader audience than any of its previous attempts at home-grown characters and universes.

Of course, home grown means no licensing fees to be paid, so the success of The LEGO Movie has pumped new life into the LEGO brand. Already, a movie sequel and additional products are in the works. At the same time, LEGO may have found a niche to attract girls to the LEGO brand. The release of its LEGO Research Institute collection that promoted women in science, technology, engineering, and math (STEM) careers was another success. The limited edition sets sold out quickly and consumers wanted more.

Bottom-line, LEGO appears to be finding ways to meet consumer demand while creating new forms of demand at the same time. That is a recipe for long-term success. Now, we just have to wait and see if the company can maintain its momentum.

Image: Benjamin Esham licensed CC BY-SA 2.0