Why Brand Advertisers Will Be the Biggest Beneficiaries of Social Media and How You Can Participate

Sitting now in Michael Lazerow's session, "Why Brand Advertisers Will Be the Biggest Beneficiaries of Social Media and How You Can Participate." Lazerow is a great speaker and this will be the third conference after Graphing Social Patterns and Social Ad Summit where he has been able to retain me as an audience member. I really need to make sure I get a Buddy Media (cool blue) t-shirt from him this time :)

He starts with the slide, "Social media is here." 37% of adult internet users are using social media sites. All major social networks have opened up their platform. Brands now have cost-effective access to more than 500MM engaged users. 250 million of these users are on Facebook and MySpace alone.

There is massive distribution but still less than 1% of digital ad budgets flow into this space. Social advertising right now sucks. All the techniques that used to work in the past, don't work anymore. Clearly, we're at a junction where we need to invent what's next and how we need to get to the users. One of the problems today is that there is too much noice. Another problem is that it is not scalable. Third problem is that social advertising is not tied to results. We need to know what are the results and how to tie them. Over 100 companies are selling Facebook alone.

Social is not just about advertising. It's not about displaying banners. It's about marketing! It's about CRM and engaging conversations. It's about people.

Impressions are worthless. They are like air. There are so many impressions available today. In the social media sites, impressions are basically worthless. The whole model of buying impressions is like shouting at users and yelling at them.

The new model is Buy Engagement, Earn Loyalty. How do you turn your consumers into intense advocates of your brand? The intense adoption of , commitment to and interaction with a brand in social networks.

We've gone from shouting to listening in the new model.

Next, he is going to talk about case studies that generated results.

The most forward-thinking clients are building applications to support their marketing activities. These are not just facebook or myspace applications. Ad units are tied to a database connected to social graph. In the end these are ads, but better ads.

So why apps? Because of :

• Emotion,
  
• Engagement,
  
• Efficiency and
  
• Social Intelligence.

There are two main buckets of apps:

1. Ad applications and the second one is sponsored gift section. You can send a free airborne gift to your friends. Another example he is showing of Tropic Thunder advertising campaign by Social Media.

2. Social branded applications which are cross-platform, tied to CRM, "socialize" existing sites. These apps allow for engaging creative, scalable technology and you pay only for results.

Now is the somehat famous example of campaign Buddy Media did for FedEx. It's a very simple application but simple is sometimes the best. Results of this apps:

• 100,000 installs in 72 hrs.
• more than 300K active users in 6 days
• less than 10% uninstall rate
• global audience in more than 200 countries
  

Next is New Balance campaign which was recently covered by MIT Review. Results:

• 250K active users
• 86% of visitors came back at least once
• 57% came back 9 times or more.
• 1M+ AceBucks earned by consumers playing the game, which can be redeemed for actual shoes.
  

Facebook just launched age-gating allowing for applications to be limited to a certain age group.

Next example is the "Dude" campaign socialized by Bud Light. They worked with anthropologists to come out with the perfect photos for the application. Results from 5 week long campaign (it's still live):

• 200,000 installs in 5 weeks of marketing
• first application to successfully implement an age-gate that prohibits minors from accessing the app
• 14% average daily active user growth
• 6,000+ daily active users during campaign
• 19% of users visited every day during campaign
  

Next is the InStyle.com campaign. Results:

• 185,000 installs in 6 weeks
• 78% of user base were InStyle's target demo of females 18-35
• avg. time on application almost 7 minutes
  

Buddy Brain provides app results which are promising. Users spent 2:35 on average engaging with the last 10 branded apps. This is 75x greater than time spent with banners and 5x more than time spent watching tv ad. 85% of the users returned multiple times to Buddy Media's apps.

The single biggest mistake brands make is that they launch and expect it to be the top app.

How do you get started?

• Make goals. Track results
• Think big. Start small
• Go fast. Iterate. Iterate
• Socialize everything
  

The days of viral growth are over. The app is the new ad unit. Facebook is not the choice of platform for everyone. Trailer views are directly related to ticket sales.

As always a great session by Lazerow!

Buddy Media Delivers Advertising on Engaging Social Media Applications

A friend of mine recently introduced me to Buddy Media, creator of several popular social networking applications and games including AceBucks, Mental Blocks, Sudoku, Pirates vs. Ninjas, Vampires vs. Werewolves, Cops vs. Robbers, Air Hockey and Pub Darts.

Launched in 2007 by Michael Lazerow, Kass Lazerow and Aryeh Goldsmith, Buddy Media also offers application development services for social networking websites. At the time of writing this post, Buddy Media claims that they reach more than 8 million Internet users every month.

Buddy Media also claims to "build an application and drive 1 million users in just a few months" for its clients.

That's a very ambitious claim to offer publicly.

“Buddy Media approves each developer to certify that only developers working on engaging applications can leverage Buddy Media’s sales engine. Our main focus at Buddy Media is not to aggregate the most amount of inventory in the social media space. Frankly, there’s already too much social media inventory. Add together the traffic from MySpace, Facebook, Bebo and the other social networks, social applications, blogs and more, and you get to trillions of impressions a month! We’re only focused on helping developers of quality applications make more money from their apps with access to higher-paying advertisers who value targeted, premium reach.” - Source: Buddy Media Blog

However, the applications created by Buddy Media was not the reason my friend introduced it to me. Instead the reason was Buddy Media's new social media ad network called Buddy Media Advertising Network.

Targeting: Buddy Media allows advertisers to target their ads by age, sex and location. In future more targeting options are expected to be available according to BM website.

Pricing: Buddy Media offers several pricing models including CPC (clicks), CPI (installs) and CPM (impressions). Performance based pricing model is available to a select few marketers.

Creative: Advertisers can either use their existing creative or create new ones using Buddy Media's provided system.

Where ads are shown?: Advertising campaigns delivered through Buddy Media's advertising network reach applications created by an "invitation only" developer network and deployed on various social networking sites including Facebook. Advertisers are offered "visibility into the apps" on which their ads are displayed.

Clients: Buddy Media's clients include Microsoft, FedEx, Anheuser-Busch, Priceline, Readers Digest, Time Inc. and Huffington Post.

Funding: Buddy Media recently raised $6.5 million in series B financing round led by Softbank Capital, European Founders Fund and GreyCroft Partners. Earlier Buddy Media had raised $1.5 million.

Overall Buddy Media seems to promise high ROI and quality exposure for campaigns by carefully choosing developers that create engaging social media applications.

While Buddy Media may be able to create great exposure for brand advertising, I remain skeptical on the short-term immediate conversion part. After a while it is very easy for users to become immune to ads that are embedded in widget or applications.

How many times have you clicked on an ad within your favorite Instant Messenger or similar application that shows ads while you chat?

Userplane, the company that offers free chat solutions based on an advertising-revenue sharing model, embeds ads in their chat client. Yet I can bet that users who use Userplane's application remain involved in their conversation and end up becoming immune to advertising that is present.

The world of widget-embedded advertising is about to get very crowded with Slide and Rock You, among others, working on similar advertising networks.

From a user point of view there is one interesting thing going on here. Widget companies are getting access to the user's data based on the application they developed and then creating new business models and applications based on the information that's passed back from social networking websites.

Only time will tell where Buddy Media can take their current targeting offerings.