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[ This is my personal blog so all opinions expressed here are mine. I am a product, scalability, operations and monetization advisor and currently employed as Director of Business Operations & Technical Strategy for a top 50 website that delivers billions of page views per month. I was a keynote panelist for Scaling Up or Out keynote at MySQL Conference and speak regularly at conferences and user groups. ]
Farhan "Frank" Mashraqi

Wednesday, September 17, 2008

Viral Marketing 2.0

I am sitting in the session Viral Marketing 2.0 at Web 2.0 Expo. The speaker is Jonah Peretti from BuzzFeed. Jonah is also the co-founder of Huffington Post.

Why somethings go viral and why others don't? Virual diffusion is unpredictable and hard to control.

Core concept that is important is "the bored at work network. (BWN)". The BWN is bigger than NBC, CBS, or any other traditional media network. This decentralized network enables media to "go viral" if ordinary people enjoy sharing it.

The old broadcast model of media is simple and reassuring with the broadcaster in the center. Broadcaster decides what is important and popular.

The new networked world with Internet connecting everyone involves everyone deciding what is popular.

Who can make something popular? Key research performed by Watts and Dodds, JCR 2007. It's not special people that decide what's popular. Rather it's the network that decides what is popular, not the influential taste-maker.

If network permits diffusion, everyone can start something. Example is a forest fire, early facebook apps, blogs and embarrassing homemade videos. Whether or not something spreads depends mostly on network structure. Network structure is often the most important thing.

Hindsight Bias (unrepeatable in the future): after the fact, influential people seem like the key factor. Read the tipping point book. East Village hipsters wore lots of ridiculous clothes besides Hush Puppies. Jeff Jarvis author of Dell Hell, complained about many many things on his blog besides Dell. The problem with hindsight bias is it is not repeatable in the future.

Another project by Dodds was the music lab experiment. Subjects are shown a grid with MP3s from unknown bands. They were then tracked. In some worlds, there was social information condition where people could see and in other worlds they had independent condition where they didn't know. He found that people don't know what they like. They look around. Different songs were popular in different worlds, i.e. no consistent hits. Social influence increased inequality and unpredictability. Mediocre songs did become number 1 but the worst songs never became number 1 and vice versa.

The big problem is radical unpredictability. We can't predict WHO will make something popular or WHAT will become popular. The web is confusing, counter-intuitive and unpredictable.

Soultions:

1. Contagious Media: Make something that ordinary people want to share with each other. Make it easy to understand, easy to share, and include a social imperative. Make media perfect for the Bored at Work Network

What he created for BWN: A Nike "Sweatshop" Email. He ordered a pair of Nikes customized with the word "sweatshop." He then ordered the shoes. Next day he got an email saying the id "sweatshop" is a slang so they won't send him the shoes. Eventually they said they won't send shoes. He asked for the picture of Vietnamese girl who made them. He forwarded an email which led to a viral cascade. He landed up on Today Show debating with a Nike executive.

He wanted to see if he could re-create it. So he created The NYC Rejection Line which allowed people to give "your number" that would play the rejection message with the option of talking to a comfort specialist. People started messaging each other with that number and eventually it got picked up by media.

Then he created a BlackPeopeLoveUs.com which landed him on Good Morning America. They wanted to have a black person who didn't like the site to come on the show.

BWN trumps influentials.

Limits of Contagious Media: Most things are not viral. He wrote a paper "Viral Marketing for Real World" published in Harvard Business Review. R of 1.1 can be awesome but R of 0.9 can stop viral growth.

Solution #2: Big seed marketing: small seeds lead to failure: 10 people recruit 5 people etc. But sub-viral growth is still growth. Big seeds lead to success: 1 million people recruit 500K people, etc.

He did a campaign with Tide Cold Water for a detergent that could save energy. P&G has a huge email list. They created a map showing how many people have accepted the challenge.

Word of Mouth without tipping points. Tide Cold water seeded with huge email list and got 40K extra people. Huge value without elusive tipping point even when the R was less than 1.

Solution # 3: Multi-Seed marketing: try lots of creative ideas - nobody can predict what will be popular. Test to see what is working using real data. Big seed the stuff that is working best. Bottom line is that more data enables more creativity.

You should remove the bad seeds and grow the good seeds. What can a serious business do?

Solution #4: The Mullet Strategy: Business upfront, party in the back!!! At Huffington Post they have business upfront and party (comments, discussions) in the back. Add, Test, Tweak, Optimize, Remove stories in real time. If the editors see the headline is not gathering interest, they will change it.

The Power of Mullets: The front always looks sharp. No need to find influentials and predict the future, just let the good stuff bubble up. Other examples include Youtube, MySpace etc.

Solution #5: Personality Disorders: The web is ruled by fanatics like Perez Hilton, Apple fans, blog commenters, and other crazy people. Help your audience and users fully express their personality disorders.

Histronic/Narcissistic Personality Disorder is key to success for blogs, YouTube, MySpace.

Obsessive-Compulsive personality disorder is key to success for wikipedia, delicious, online games and comments.

Which is better Judaism or Mormonism? Judaism is a high quality religion but their marketing is terrible. They don't want other people to be Jews. He is showing performance metrics of Jews and Mormons. This means that quality isn't the best strategy. Companies with high quality as their only strategy are doomed.

Solution #6: Learn from the Mormons. Mormons want you to be Mormon! Make evangelism core to your strategy. Focus on the mechanics of how an idea spreads, not just the idea itself.

Conclusion:
1. Contagious media: make media that works for the BWN.
2. Big Seed Marketing - do viral marketing without needing elusive tipping points
3. Multi-Seed Marketing - try many ideas and optimize on the fly
4. Mullet Strategy
5. Personality Disorders - use your audience's craziness to your advantage
6. Create Mormon style media, not Jewish style media.

Excellent session overall. I gotta ask him the name of the disorders book.

Contact: Visit his site at buzzfeed.com (jonah at buzzfeed dot com).

When is BWN most bored network? Look at server logs and analytics. Probably when people at east coast and west coast are both at work. Traffic at websites is highest during working hours.

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Sunday, June 15, 2008

Viral Marketing and Advertising Strategies for Social Networks - Presentation

Earlier, I blogged about the Graphing Social Patterns session, Viral Marketing & Advertising Strategies for Social Networks - Presentation.

Kevin Barenblat, co-founder of Context Optional uploaded the slides to slideshare.net (Thanks Kevin!). I have embedded them below.

one of the best [presentations] i've ever seen on this topic- Dave McClure (500 Hats)
I agree with Dave as it was certainly one of the best and most thought provoking sessions at the conference and I am not alone in thinking that. I heard rave reviews from attendees after Kevin finished his session.


Following presentation is by Jeff Ragovin, VP of Sales for Buddy Media.

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Monday, June 09, 2008

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.

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