Viral Marketing and Advertising Strategies for Social Networks

After the lunch break at Graphing Social Patterns, I decided to go to Kevin Barenblat and Jeff Ragovin's session titled Viral Marketing and Advertising Strategies for Social Networks. I may hop to the other tutorial, Intro to MySpace Developer Platform and Apps, after the break.

There has been a big shift in how people spend their time online. He is showing the top sites as of 2005 and 2008. People are spending more and more time on social networks. By 2012, $8 billion is expected to be spent on online social network advertising. Facebook is all about viral communication channels. These communication channels allow people to stay in touch with their friends.

Next is old marketing funnel:
Eyeballs -> Awareness -> Consideration -> Preference -> Action -> Loyalty -> Buyers

People are on social networks to converse with their friends. Marketing works differently on social networks. You make brand part of your conversations. In the funnel world, money spent can predictively reach eyeballs. The most successful applications and campaigns on social networks are all viral.

Creative drives engagement. The slide shows E=mc². Media buying can only get you so far on social networks. On social networks, the creative can really drive the campaign and lead to high level of engagement.

x * y > 1 = viral growth

There are several viral channels on facebook.

The most important channel on social networks is invitations, which positioned right way should be about user's friends.

Notifications are great way to engage/re-engage users once you have recruited them.

Social Marketing Strategy:

• Why?
  
• What are the goals and objectives of the social marketing campaign?
• WHO?
  
• Who is the target customer? How is the customer best engaged?
• HOW?
  
• How should customer relationships change? How will the campaign be measured?
• WHAT/WHERE?
  
• What applications should be built? Which technologies should be used? Where should the campaign be run?
  

Last question, not the first, should be "What"?

Range of advertising options (less to more)

• advertisement (less customization/integration): banner and rich media targeted by demo, geo and/or interests)
• sponsored app: build on existing audience. brand integration
• branded page: independent presence on Facebook. users become brand fans.
• custom application (more customization/integration): interactive branded application engages users. viral channels drive growth. If you have an application, it is a great opportunity to learn about your users.
  

Facebook is probably the biggest repository of information about people in the world.

Next up is Jeff Ragovin from Buddy Media. He is talking about FedEx application that was created to engage in a fun way with users. The application allows users to send virtual gifts.

Every Application should have the following:

• a landing page that provides clear branding- easy to understand instructions
• a unique application title: You should pick something descriptive, unique and interesting. Just based on the title alone, a good deal of users may start using your application.

Next, Jeff engaged us in an exercise of creating an application.

Overall, the session was a lot of fun. Thanks to Jeff and Kevin for sharing their insights.

Social Networks for Business and Marketing Managers

I am sitting in the session "Intro to Social Networks for Business and Marketing Managers" by Ro Choy of Rock You! Folowing are my notes from the session.

Five years ago, people considered Google to be the entry point for the Internet. Now you are talking about social media and social network being the absolute entry point. Where does a teenager go first on the Internet?

What's most relevant for a teenager? Everything related to their social network.

Gone are days of SEO to position your business. Today the question is, what do I do to position my presence online within social networks.

There is an attendee from the State Department interested in reaching globally through social networks.

Another attendee from Microsoft wants to understand how to incorporate feedback mechanisms.

What are social networks used for?
Content posted on social network: "What do you do with your social networking profile?" - Active Internet Universe

• 55.1% upload photos
• 21.9% upload videos
• 74.0% message friends and communicate
• 30.8% write a blog
• 18.3% dating
• 23.3% install applications
• 9.8% promote a band
• 33.6% favorite/currently listened to music
• 3.2% do other activities
  

What are the differences between services?

• Facebook is a communication/collaboration tool which is highly structured and highly functional. Facebook is known for its primarily college-age, well educated high-income demographic although currently Facebook has many diverse demographics today. Historically it was known as an "elite" network for universities.
• MySpace is more famous for self expression. It is less structured and more customizable. You'll see millions and millions of different looking pages. MySpace has a younger, more diverse demographic. The younger you are the more time you have and therefore you can spend time on customizing your page. You can keep scrolling down for hours on some pages. Try 50 cent's page. Historically MySpace was famous for being a haven for music artists.
• LinkedIn is like a proxy for business cards. LinkedIn is used to keep business contacts in touch with each other.
  

How is Facebook used?
Four most important areas of Facebook:

• Profiles:
• used to create a profile
• communicate with friends
• share media
• install applications
• browse
• other!
• Pages
• Groups
• Events
  

Each of the above revolve around trying to communicate.

New Media today is about communication and about finding interests. Information collected by social networks like Facebook is a gold mine for advertisers.

There are 45 million people using RockYou's tools on Facebook today.

Among younger generation, email is old medium. 90% mail in his Yahoo! mail is spam whereas 0% of messages on his wall are spam. I find this hard to believe as Wall's on Facebook do generate quite a bit of spam, even though that spam is sometimes being created by your friends :).

You can make a lot of money at Facebook. Anything that works on the Internet, works on Facebook within applications.

Facebook email is probably used more by Facebook users than their own personal email account.

No one likes to read in social environments. Reading is 'death of viral.'

MySpace overtime has adopted a lot of Facebook's features. Background is really important on myspace. It took Ro a week to 'make his profile look really bad.'

Career-oriented and older demographic are the primary users of LinkedIn, which has now adopted Open Social. LinkedIn offers a somewhat different experience and allows you to make business connections, get recommended by associates and to post one's resume.

Viral marketing is key to success. He's showing a graph depicting explosive growth in Rock You's usage.

Key Takeaways for Viral Growth:
- New User focus: Without it, viral isn't possible.
- Simplicity
- Novelty
- Universal Applicability

When you communicate with new users, focus on actionable items because it's the action that's viral. Don't make your users fill out a form.

Anti-viral is thinking. Deliver something with immediate value proposition.

Simplicity is also co-related to virality. Things that take 10 seconds are more viral than things that take 30 seconds. Things that take 1.5 minutes aren't viral at all.

In the viral space, people who know viral get big really quickly. To win virally, you must be novel. There are a lot of free gifting applications. Even small ideas that make an existing application novel can hit big, but there must be something novel about about it.

Games can be very specific or very broad. Casual games do really well on social networks.

RockYou's competitors are experts in viral marketing who look for immediate exposure. Don't market until there's a base established for viral methods.

Good viral methodologies generate 2 new installs per user. Even viral rate of 1.001 is healthy.

Building Viral Engagement: (chart of circles with inner to outer most: user -> direct friends -> indirect friends -> interested parties)
1. New users => build clean flows
-- New users are absolutely key to viral engagement (vs returning user).
-- focus on linear, one-action flows to maximize activation for new users
-- forget registration.
2. Direct friends => deliver clear value proposition
-- provide clear value proposition to new user for inviting friend network (Likeness)
- ensure invitation is first/second step new user flow to maximize viral value of user (superlatives vs superatives)
3. Indirect friends => focus on messaging
-- focus on on messaging to invite/notification receivers to drive more friends invites
-- deliver increasing AND simply understood value to app w/ ever friend invited (Zombies)
4. Interested Parties => allow universal use
-- enable simple tols (comments, ratings, answers) that allow interaction w/o requiring full engagement w/ application (My questions).
-- Old school discussion boards are awesome
-- If you depend on creativity for something viral, you're dead.
-- for e.g. for movie review, have pre-created choices for users (I love this, thumbs up OR I hate this, thumbs down)
--- Click rate for this kind of engagement is really high.

Remember, activities drive awareness. Facebook will reduce an application's ability if your emails don't get clicked on. Your bandwidth on platform will decrease.

Marketing opportunities with social applications
How do you market something successfully in social space? Successful marketing for social media should focus on social applications.

1. Application content integration
-- Integrating brand or product as part of user experience (e.g. Indiana Jones character)
-- Example: likeness quiz, virtual gifts, greeting cards, virtual actions etc.
-- build applications that take into account existing user behavior.
2. Sponsorships or branding of applications
-- app takeover or skinning w/ possible promotion
-- Example: Skin application w/ sweepstakes or cntest
3. Custom social application building and distribution
-- Build a social app for advertiser and/or distribute it through social network specific ad networks
-- Example: build, viraal tune, launch and seed an app recruiting users from RockYou's leading ad network jumpstarting viral spread of app.
4. Rich Media.

For Sweeney Todd campaign, there was a 0.01% CTR for banner alone but when they did integration with application the CTR jumped to 0.65% (65x better).

RockYou created a SuperWall card for Step Brothers and provided that as an example for application integration. They featured two custom designed greeting cards on SuperWall. Greeting Cards were placed in top placement, pre-selected and expanded upon roll-over. The card appeared in user's profile. The results were 8M impressions on application pages. 6M cards sent and immeasurable viral impressions through newsfeed events and in-profile prominenece. These were traditional CPM based campaigns.

Women tend to be more active in sharing content.

Application Sponsorship:
RockYou worked with Sony and Resident Evil to create skins or brand applications. ResidentEvil campaign was expecting 10K registrations for contest but they achieved a million registrations for the contest.

CTR rate:
Social networks: 0.13%
Web 0.20%
Avg RY ad: 0.28%
Best RY campaign: 30%!!!!

Some rules of thumb from Context Optional for developing and promoting applications for social networks.

Application development and Promotion:
- 3rd party ad networks on Facebook can radically accelerate Facebook application adoption
-- RockYou
-- SocialMedia
-- Lookery

- From RockYou's experiecne, advertisers can generate between 1000 to 20,000 installs a day
- CPI can be as much as $0.60.
- Consider potential throughput of the ad network
- quality of ads => requires constant tuning to maintain high CTR
- Ad copy => make it actionable and presonally identifiable
- viral tuning => work with a team that knows engagement / growth
- successful applications require ongoing investment.

Stylefeeder:
Largest fashion/shopping application on Facebook with over 1 million installs. They are getting multi-dollar CPMs. Their goal is to drive traffic to existing website.

Rich Media on Social Applications can provide 2x interaction rate and 2x activity rate (e.g. campaign for Ruins movie)

Monetization:
Online advertising is growing but social advertising is growing 3x faster. CAGR in global online media advertising is expected to reach $61 billion by 2010.

Context is the key to social application monetization:
Search is not viral and has high context and low virality. With social networks you have low context and high virality. With social applications, you can get high context and high virality: Apps add context to social networks and social apps are viral.

1. Application cross-promotion:
- CPI = $0.30 - $0.50
- selected customers: Acuvue, IAC, Microsoft, NBC, ESPN, Coca Cola, Expedia

2. Agency sourced branded advertising
- CPM = $2.00 to $10. (their avg CPM from brand agencies is $5)
- customers: Sony, AT&T, Warner Brothers

3. Direct response and lead generation
- CPA

4. Virtual Goods, Micro-transactions and subscription

Agency sourced branded advertising campaigns can range from $30K to $150K spend.

The session has ended. We ran over about 10 minutes but it was worth it.

Graphing Social Patterns East - Leaving for DC

Graphing Social Patterns is the premier conference on the topic of social networking and social graphs. The conference is being held in Washington DC.

In a few moments I will be leaving to attend Graphing Social Patterns East. The drive is about four hours so not too bad. I always enjoy driving this route as my first driving route in the US was from German Town, MD to New York.

I wanted to go to Graphing Social Patterns West as well but couldn't so I am very excited to attend the east one. I plan to learn about the inner workings of the platforms and engage in networking opportunities at the conference.

The conference is being held at Hyatt Regency Crystal City which is where I will be staying.

The conference explores social networks from two interesting perspectives:

Business & Marketing Strategy:

* LinkedIn: The Business Social Network
* MySpace and Facebook Social Advertising
* Apps & Widgets: The New New Ad Units
* Social Advertising & "App"-vertising
* 10M in 10 Weeks: What Stanford Learned Building Facebook Apps
* Social Networks & the NEED for FEEDS
* Social Networks for Mobile Devices

App Development & Technical Strategy:

* Google OpenSocial + AppEngine Technical Overview
* Poke Back: Facebook Platform Team Live Chat
* Bring Your Own Platform (BYOP)
* Social Games for Social Platforms
* Geek Metrics: App Analytics for Distribution, Engagement, & Monetization
* OpenSocial: Open for Business
* VIRAL vs STICKY: Designing Social Apps for Reach & Retention
* Show Me the Money: App Monetization

The keynotes at the Graphing Social Patterns conference include:

• LinkedIn: The Business Social Network by Adam Nash
• MySpace Business & Marketing Overview
• Facebook Business & Marketing Solutions by Kent Schoen
• Google OpenSocial + AppEngine Technical Overview by Patrick Chanezon and Paul McDonald
• Technical Overview: The MySpace Developer Platform (MDP) by Allen Hurff
• Poke Back: Facebook Live and Interactive by Benjamin Ling, Dave Morin, Ruchi Sanghvi, Josh Elman and Dave McClure.
  

It should be a lot of fun to see old friends and make new ones. If you are attending, ping me via this blog or by email (on the top right hand side) and let's meet up for a drink or two ;)

Social Graphs, Data Portability and Monetization

Andrew Chen writes a thought provoking blog post about portability of social graphs and data in a social networking context at Inside Facebook:

“ * One potential issue that makes social networks resist data portability is the monetizability of the data
* Not all user data is created equal, there’s interest versus intent
* Social networks generally produce lots of low-value interest data, which has weak ROI attached to it
* Search engines, review sites, comparison shopping, etc all produce high-value intent data
* Even if you have the data, you have to worry about whether or not you have enough of it to matter - although ad networks and exchanges have started to alleviate that”

Need for Interconnected Social Networks

I came across a post written last year by Dave Winer. In it he talks about the importance of interconnected social networks.

“Closed systems are fine in the early stages of a new technology. They're the training wheels for a new layer of users and uses. But, as we always see, the training wheels eventually come off, explosively, creating new systems that throw out the assumptions of the old.”
Dave's wishes, to some extent are getting fulfilled by Google Friend Connect and Facebook Connect: Two services that attempt to make social graphs portable.

“Eventually, soon I think, we'll see an explosive unbundling of the services that make up social networks. What was centralized in the form of Facebook, Linked-in, even YouTube, is going to blow up and reconstitute itself. How exactly it will happen is something the historians can argue about 25 years from now. It hasn't happened yet, but it will, unless the rules of technology evolution have been repealed (and they haven't, trust me).”