From TechCrunch coverage of Apple’s WWDC:
“Apple has iAd commitments for 2010 totaling over $60 million, which the company says represents almost 50 percent of the total forecasted US mobile ad spending for the second half of 2010. Jobs said in his keynote that Apple has only been selling iAds for 8 weeks.”
Wow, is this really accurate?
ClickZ NewsOrbit Gum Sponsors 'Dirty Shorts' From Will Arnett and Jason Bateman
By Zachary Rodgers, ClickZ, Jun 11, 2010
DumbDumb, an advertiser-centric production studio, has released the first of three "dirty shorts" with Orbit Gum. Jason Bateman and Will Arnett star in the crass sketch (see video below), which runs five minutes and depicts a strict mother and father (Bateman) confronted with their young daughter's skeevy 40-year-old prom date (Arnett).
Bateman and Arnett are also the driving force behind the DumbDumb enterprise, which they launched yesterday in New York with the help of Electus, the IAC-owned entertainment studio founded by NBC television alum Ben Silverman. The actors have previously appeared together in FOX's Arrested Development and separately in films like "Horton Hears a Who" (Arnett) and "Up in the Air" (Bateman).
Arnett and Bateman screened the video last night at a launch party for DumbDumb, which claims to have already signed multiple other deals with brands.
Orbit's first short was posted on YouTube this morning, and all three shorts will begin appearing in various destinations on the Web in the coming months. Orbit agency Energy BBDO in Chicago had creative input, and DumbDumb also consulted with a staff of writers, including members of the Upright Citizen's Brigade.
"I'm not a seller; I'm not an advertiser. We don't claim to do that," Bateman told the New York Times. "We're just looking to make cool pieces of entertainment and just arbitrarily make that subject matter a brand's message."
The launch party came one day after the similarly themed Digitas Digital Content NewFront in New York, where Silverman and Bateman were also in attendance. That event gathered an audience of advertisers and agencies - mainly Digitas and its clients - to view online content initiatives from stars like Lisa Kudrow, Kevin Pollack, and Seth Green.
Under DumbDumb's relationship with IAC/Electus, the partner gets first shot at U.S. and international distribution rights on all of the studio's content developed for TV, movies, and digital channels.
Follow Zachary Rodgers on Twitter at @zachrodgers.
David Mihm has done it once again and published another edition of Local Search Ranking Factors. This year David surveyed 32 local search geeks to get their takes on the top factors for ranking high in Google Maps. The entire set of results is well worth the time for any business that wants to do well in local search. For those of you who just want the goods without the verbiage, here are the top factors:
- Claiming your Google Place Page/Local Listing
- Have a Business Address in the City That is Being Searched
- Associate Your Google Place Page with the Proper Categories
- Put Your Product/Service Keyword in Your Place Page Business Title
- Proximity of Your Address to the Searched City’s Centroid
- Product/Service Keywords in your Google Place Pages Description
- Associating Photos with your Google Place Page
- Associating Local Area Code with your Primary Place Page Phone Number
- Associating Place Page with Marginally Related Categories
- Location Keyword in Place Pages Business Title
See you in the 7 pack!
Here you go. A simple check list for local businesses to improve their Google listing. Most are rather simple to implement.
I recently attended a webinar hosted by SalesBlogcast that featured social media company BizBrag. My reason for attending was to learn how small and medium sized-businesses can take advantage of social media. Based on our Local Commerce Monitor research, 32 percent of SMBs said they plan to use a social site, while 31 percent indicated they plan to place links or ads on social media sites. What previous waves of LCM data have shown is a high desire for social media but lower actual spending, indicating a pent-up demand to spend in this category. My theory has always been that social media is often intimidating to those less familiar with Facebook, Twitter, LinkedIn, blogging and posting news features. All these activities take time and a certain level of technical expertise to manage them while also running a business.
Enter BizBrag. CEO Brian Smith made it his mission to try to develop a single platform where SMBs can manage all their social media activities including e-mail marketing. “With so many social media outlets, with varying ways of inputting data and broadcasting information, BizBrag’s goal was to create an easy to use all-in-one platform. The goal is to help small businesses create ways to draw activity to their Web sites by creating more ways to be found on search engines via blogs, news articles, and social media posts.” Small businesses create a BizFolio that shows all their activity and provides a simple description of the company. The dashboard feature allows the company to create news articles and posts about their company showing them where they can post their information. Enter a news story (Called a Braggit), check a few boxes on where it can be posted, upload an e-mail list, and then hit submit.
BizBrag is two months out of beta and now gaining speed with 1,000 advertisers signed on since going live. Leveraging its social media expertise, BizBrag has been active in working its social media network to get the word out to SMBs. Smith pointed out, “if the pace of inquiries and new advertisers signed on in the last two months is any indication, we seem to have hit the mark with small businesses trying to figure out an easy way to start and manage a social media campaign.”
No Comment
Local media properties should be doing this....or partner with these folks.
Finally something is more popular on the web than porn!
We've written before that we think group-buying site Groupon is huge, even cheap at $1.2 billion.
Huh?
TechCrunch broke some numbers about Groupon's financials, but only managed to confuse us even more.
TechCrunch writes that Groupon's estimated 2010 "revenue" is $350 million and that it makes "$1 million or more per week in pure profit".
We've heard every number for Groupon 2010 revenues, from $100 million to $300 million.
In valuing the business as cheap at $1.2 billion, we picked the conservative $100 million number. Outside of the fact that putting some numbers on a per-week basis and some on a per-year basis doesn't make understanding the business easy, the problem with estimating the size of Groupon's business is the difference between actual revenues and "gross merchandise sales."
What's the difference?
Groupon partners with local businesses and sends them customers. So when you buy a deal on Groupon, the majority of that money goes to the partner business, not to Groupon (or rather, not for long). All the money that flows through Groupon should be called "gross merchandise sales." But Groupon needs to meet and exceed its costs to generate profits not from gross merchandise sales, but from the cut it takes.
Is the $350 million per year gross merchandise sales or revenue?
What's more, "$1 million per week" (let's round that to $50 million/year to avoid headaches) in "pure profit" sounds great, but "pure profit" is a concept with no meaning.
Is that net profits? Is that free cash flow? Is that EBITDA (earnings before interest, taxes, depreciation and amortization)?
Now, we've also heard that because Groupon is so popular, it can afford to take a huge cut of the money that goes to partner businesses, even after providing steep discounts. We heard the cut is as high as 30%.
If the average cut is 30%, that would explain a lot. The $350 million number could be gross merchandise sales and the $100 million number could be revenues. But that would make the $50 million "pure profit" number very unlikely, if that denotes net profits.
50% net profits for a discount site? Seriously? If that denotes free cash flow or EBITDA, we can talk.
Or we could work our way up from the $50 million/year figure. If that denotes net profits and the $350 million/year figure does denote revenue, that would give the business a net profit margin of roughly 14%, which is still very high for a young discount business but a lot more believable. Using the 30% cut figure, that would put gross merchandise sales around $1 billion.
If we had to guess between those two, we would say the $350 million number is gross merchandise sales and $100 million is actual revenue. Our instincts tell us if Groupon had hit a $1 billion run-rate in gross merchandise sales already, that press release would've already hit our desk eleven times.
From that we would guess the $50 million "pure profit" number is actually EBITDA, which is nothing like "pure profit," but 50% EBITDA margins would still be very good for pretty much any business, especially a discount site. Or the number was made up.
What's more, a $1.2 (the number now appears to be $1.35) billion valuation for $350 million in revenues would be extremely cheap, 3X revenues compared to roughly 10X revenues for Facebook and Zynga, in which Digital Sky Technologies also led the round.
But who knows!
So, as you can see: this is all pretty hazy. We're still very bullish on Groupon and think its valuation was justified at whatever end of the spectrum its financials are, given the market and the brand. But its financial picture is still very hazy.
Who has details? Let us know!
See Also:Groupon And Its Zillions Of Imitators Are Trying To Cash In On A New Group Buying Craze >
This may be a more profitable model for local media's attempts at local search. This can be particularly valuable for local media companies with sizable email databases (Groupon sends out daily emails to generate sales). Click on any of the links in this story. The comments on the original articles have some good math analysis.
Stay on top of the news, sign up for our free newslettersMagazines' Pitch to Marketers: Our Ads Will Work -- We Promise
Time Inc. Works With Starcom MediaVest to Guarantee Performance Results, or Run Make-Good Advertising
by Nat Ives
Published: May 10, 2010NEW YORK (AdAge.com) -- Magazines have always promised their advertisers a certain number of paying readers. Now the industry is moving toward another guarantee: that its ads will work.
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--> One of the industry's biggest publishers, Time Inc., and one of its biggest ad buyers, the Starcom MediaVest Group, are collaborating to develop promises that certain numbers of people will remember ads or take action on them. If a participating marketer's campaign doesn't achieve the promised result, Time Inc. will run free additional ads until it does.
The effort, dubbed the Alliance for Magazine Accountability, will start with select Starcom MediaVest clients. The companies declined to identify those clients, some of whom they said are still being chosen, but Starcom MediaVest's client list includes heavy hitters such as General Motors, Allstate, Walmart and Coca-Cola.
The Alliance will study audience and performance data from outside providers, Affinity's Vista service and Mediamark Research and Intelligence's AdMeasure service, covering the first half of this year, then start making guarantees covering the second half of the year.
"We've been preaching that magazines engage readers like no other media," said Stephanie George, exec VP at Time Inc., which publishes magazines including Time, People, Sports Illustrated and Fortune. "So today, in a crowded media market, when it comes to accountability, the work from this Alliance will help prove magazines' advertising effectiveness."
NBC's moves
The recession, new research tools and increased spending on more easily tracked digital channels have pressured all media to better prove their worth to advertisers -- and that's slowly making performance guarantees more common. In TV, for example, NBC has been guaranteeing audience engagement to some clients in particular deals for several years.Circulation will continue to be important because it's a valuable metric and benchmark for all marketers, said John Muszynski, chief investment officer at SMGX, a Starcom MediaVest unit where the group's agencies exchange intelligence, test new models and share resources. "However," he said, "as all the other media out there start to bring out more sophisticated, more precise targeting data and accountability metrics, the magazine industry needs to keep up."
The other major magazine publishers, including Condé Nast, Hearst, Bonnier, Meredith and Rodale, only guarantee paid circulation. But since the beginning of the year, two magazines, Scholastic Parent & Child and The Week, have also been guaranteeing performance for marketers making big enough ad buys. Both titles use Affinity's Vista service, which surveys readers on measures such as ad recall and actions they took after seeing ads.
Scholastic guarantees qualifying advertisers, such as Walmart, Panasonic, Discover and Trident, that their ads will generate enough reader action to rank in the top third among the women's magazines that they are using. If an ad campaign's results fall short, Scholastic Parent & Child will issue a 10% refund.
The Week guarantees each qualifying advertiser that its ads will get reader recall scores that rank in the top third of all the magazines in the marketer's media plan. If they don't, The Week will run more ads until the guarantee is met.
Time Inc.'s pledge
The pledge that Time Inc. and Starcom MediaVest are developing is different because it deals with the number of people who recall an ad campaign or take action in response to it, not performance in relation to another title or mix of titles.The Week's guarantee makes advertisers happy, helps sell ad pages and shores up ad prices, according to Steven Kotok, president at The Week. "We only do it for 12 pages of advertising or more, so a lot of advertisers are running extra paid pages to reach that threshold to get the guarantee," he said. He wouldn't disclose the eight marketers participating.
"In an era when a lot of advertisers ask for rollbacks across the board, the guarantee is what lets us keep rates steady or ask for an increase," Mr. Kotok said. "'We'd love to give you last year's rates,' we say, 'but then we can't give you the guarantee. If you take a nominal increase, we can give you the guarantee.'"
The push toward performance guarantees from a major publisher such as Time Inc. suggests such promises could become much more common for magazines -- especially if it proves to help ad sales.
But how these guarantees are executed will determine how much they benefit magazines and advertisers, said Scott Kruse, managing director and director of print at Group M, another major ad buyer. "In theory, this sounds like a positive, but there are going to be a lot of questions around methodology and the nature of the guarantees," he said. "It's one thing to do it on a smaller title like Scholastic or The Week, but when you do it across a major publisher, it could become a lot more complex in terms of how you manage that, how the methodology is based and the methodology for the make-goods if the guarantees aren't met."
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Most TV is still bought on these crazy demos: 18-34, 18-49, 25-54, etc. How can you be accountable for response or action when you consider how different a person aged 25 compared to a 54 year-old? I preach a good 1st step for local TV stations would be to tie on-air campaigns more to their various digital assets. The integration could provide some quantifiable methods for accountability. Yeah, it's more work than just delivering a CPP, but as Time Inc. has found out, accountability is the only way to grow long-term.
