The Future of Ad Spending During Financial Crisis – A MUST KNOW!

If you’re new to the Online and New Media space, then you need to understand how our current financial situation impacts our space. I myself see the future Ad Spending projections change on a quarterly basis, and with the current financial status of our economy, I can only expect to see these #’s change more often.

EMarketer.com US Online Advertising Revenues

eMarketer.com - US Online Advertising Revenues

If you are worried about the effects of the current financial crisis on the US Online Ad Revenues, then take a look at these stats. For newbies, I really enjoy eMarketer.com graphs and information. They really help visually bring you up to speed while provide articles that are very informative and to the point. Novices and advanced alike, these graphs are worth it. (NOTE: You need to sign for their Free newsletter, otherwise all their info is archived for paid users after 30 days of publishing any article.)

Now, the 2 big collectors of stats in our space come from these top 2 sources: Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC). [If you look at a lot of my Q1 Reports Article, that info was IAB and PWC based.]

I found it interesting how the the above graph shows the increase and decrease %’s of each sector.  “The negative growth for classifieds closely reflects economic weakness,” said David Hallerman, senior analyst at eMarketer. “Whether used on eBay to sell products, on job sites by employers, or for real-estate sales, classified ad buys tend to be short-term purchases with short-term objectives. In contrast, most display-related ads, such as banners or video, are contracted ahead of time. For that reason, they are less of a mirror of the current state of online advertising than classifieds,” Mr. Hallerman continued. I really enjoy how eMarketer breaks down the stats so you don’t have to jump to your own conclusions.

In a recent MediaPost article, “fears for the future will cause consumers to cut their spending, while companies carefully inspect their budgets to find cost savings.” In the October Issue of Inc. Magazine, there was an article Strategies for Tough Times, What the smarters business owners are doing to cut costs, find funds, and manage staff in a slow economy. They brought up 5 diverent ways to save money (layoffs not included). You should definitely check it out. They suggested trying “Do-It-Yourself Marketing” and potentially save your company up to $66,000. (WARNING: It promotes NOT hiring a marketing consultant!)

Jack Myers, (This “Media Futurist” is editor and publisher of several newsletters and websites targeting media, advertising and entertainment professionals) said it best “The media marketplace is transitioning from one in which demand has exceeded supply (even as supply has grown exponentially)…to a marketplace in which the availability of supply is outpacing demand.”

eMarketer - Online Advertising Spending

eMarketer - Online Advertising Spending

Here’s a projection based on IAB and PWC research that will give you a sense of where our space is predictedon heading in the next 4 years. Remember, this could change! But it is necessary you know today’s prediction of tomorrow. It’s part of your job as an internet marketing “ambassador”.

Posted under Online Marketing

This post was written by Joshua Russak on October 11, 2008

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Affiliate Summit Social Media 2008: Valuable Facts!

I recently attended the Affiliate Summit Social Media Conference in NYC. It took place last Sunday, October 5th at Baruch College. It was a rather small venue compared the Affiliate Summit East in Boston, but their goal was clear: “Social Media Success!” And to be honest, I picked up mixed reviews from the affiliates in the crowd.

Don Crowther & Joshua Russak (Me)

Dan Crowther & Me

The summit started off with Keynote speaker, Don Crowther, Social Media and Blogging Expert. His advice was very effective for Experienced and Beginners alike. In reference to Social Media Marketing: “If you do it wrong in this business, it can be a huge dissadvantage!” He went on to bring quite a few surprising key facts: Facebook almost equals the amount of Google pageviews, Myspace actually got more page views than google last year, YouTube almost doubled Google! Then he went on to discuss strategy. I wasn’t too happy to hear his opinion that Movable Type Publishing was better than WordPress because it had better search engine rankings. When asked why? “B/c it’s paid for”. Unlike WordPress, you pay for MTP which means better quality service. Well – according to everything else he was telling the audience – if you apply these social media tips, it won’t matter which platform you use! “You don’t have to be a rocket scientist, just do it appropriately!” (~Don)

He ran a very interesting test. He took 5,000 of the top terms in Google (Money terms worth 50 cents or more for the #2 spot) and he found that “18% of all first page results were social media – 2 sites per page!” And he showed us quite a few examples where the social media site outranked the actual company. From this he derived that all a company needs is GOOD SEM on one side and SOCIAL MEDIA MARKETING on the other. And here are the tools he referenced: Squidoo, HubPages, WetPaint, Twitter, StomperNet.com, Google Keyword Tool, Last.Fm, Digg, and many more (MANY MORE!). As for Video, you should be doing Video Reviews, Video Blogs, etc. . He referred the audience to Camtasia and Screenflow. It’s the software you use to record your Desktop. Very applicable for training, powerpoints, presentations, etc. Also, bringing in Guest’s for interviewing creates amazing content. Then promote it in one of 2 ways. You CAN go to each video site and upload each video individually or use TubeMogul to do it all in one shot and manage your trafic.

One final warning from Dan. “Follow the Best-Practices: DO NOT USE AUTO-BOOKMARKERS, ONLY BOOKMARK YOUR A+ BEST STUFF, SUBMIT OTHER PEOPLE’S STUFF (6:1 ratio), DON’T COPY AND PASTE THE SAME DESCRIPTIONS”.

In my opinion, I could have easily left at this point feeling accomplished. But there was no way I was going to miss the next session: “Gain Friend and Infuence, With Video – Learn how to leverage video to increase brand engagement, time spent on site, and page views. Explore the tools and techniques to use when testing out video” Totally worth it. The session involved the following:

Not as valuable for me as the first session, but the audience remained hooked and interested as I looked around the room. I particularly enjoyed Melissa’s participation. I knew I recognized her. Besides acting as Director of Marketing for Buy.com, she is also Co-Host of the TV show, BuyTV, that airs weekly on G4. And I’ve seen Steve Rosenbaum at quite a few local events including the most recent Jeff Pulver Breakfast. To properly cover this one, I took down quite a few valuable quotes:

  • Steve: “I think you’ll see longer videos as time goes on”
  • Steve: “The advantage of short = you leave the audience wanting more”
  • Melissa: “If it’s not Rich Media, it’s not interesting!”
  • Steve: “There’s an enourmous amount of money out to find quality pre-roll!”
  • Steve: “YouTube is a failed Social Network!”

Yea…as you can see, they covered quite a few areas of video. And it was worth getting a picture in with Melissa as you can see in the flickr SlideShow at the top of this post.  At this point there was a break for lunch and networking. I met up with Jim Kukral and found that to be quite valuable. He was one of the main reasons I took my blog in a new direction (as you’ll start to see in the coming weeks).

The sessions I attended after lunch included:

Where'd they all go?

Empty Chairs :)

…but at that point, the room was starting to clear out! I mean COME ONNNN, it was a Sunday! Half of the crowd was probably hung over form the night before. All I can say was that from what I attended, it was well worth it in terms of quality training and networking. Check out their next event in Vegas if you can make it!

Posted under Events, Online Video, Social Networks

This post was written by Joshua Russak on October 9, 2008

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Recession Kills Brand Loyalty – Retailers Turn To Social Media!

Generic vs. Brand

"Generic" vs. "Brand"

For many individuals, money is tight these days and as the economy keeps slipping, so will brand name loyalty.

Following up on the recent topic of “Brand” vs. “Generic” during an economic downturn (Article: Financial Bailout leaves Tech & Media Behind…), I felt compelled to continue covering this direction after reading a very compelling report by eMarketer.com. In their article, Social Media and Shopping Behavior , they touch on the topic of consumers using social-media as a source for making product purchasing decisions. Quoting eMarketer, “To stay relevant, retailers must determine how to incorporate social media, such as social networks and blogs, into their marketing strategies.” Considering the cost-effectiveness of social media marketing, smaller and more generic brands have the chance to swoop in and compete with the “Big Brands” in targeting the consumers.

There are a lot of free marketing technology options for retailers, and in the online space, their target audience is continuously growing. “Generation Y (those born after 1979) online buyers are more immersed in online and mobile activities than any other generation, according to 2008 research from shopping comparison site PriceGrabber. Some 85% of Gen Y respondents said they participated in social networking, and 57% reported involvement with blogs.” (eMarketer) And Generation Y also represents the consumers with constantly updated retailer and product ratings.

A 2008 study conducted by the Society for New Communications Research found “nearly three-quarters of respondents choose retailers and products based on others’ customer care experiences shared online.” (eMarketer)

Search engines like twing.com, are going to make a profit off during this “economic downturn” as well. They developed a custom search engine dedicated to forums and online communities. Powered by their proprietary technology, Buzz Graph, they help brand managers gain insight into product and company discussions helping improve both targeting and product quality. Their sight was doing well back in July and I’m predicting they will see a boost in the near-future as Brand Advertisers start pumping more dollars into targeting their customers. Also, PriceGrabber will see more business as consumers will consult customer reviews to help in their decision buying process.

keep a close eye on how much Retailers are going to spend on “Brand Loyalty” this quarter, and how much of that is online!

Posted under Online Marketing

This post was written by Joshua Russak on October 2, 2008

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Last Day To Vote – “Silicon Alley 100”

Silicon Alley 100 - 2008 (Picture By: 10gen)
Silicon Alley 100 – 2008 (Picture By: 10gen)

Silicon Alley Insider is a business blog, produced by and for the New York digital business community…and easily one of my favorite blogs in the Online Space!

Only in their 2nd year, they are now hosting their second Silicon Alley 100, an “annual list of the 100 most influential and important folks in New York’s digital-business community.  The list includes executives, investors (venture capital, private equity, angels), financiers, attorneys, journalists, analysts, commentators, philanthropists, and others who make extraordinary contributions to New York’s digital industries (such as the guys on the right).” (Launching The 2008 Silicon Alley 100…Vote Now!)

If you’d like to Vote, then go to the Silicon Alley 100 Voting Booth and make your selection. You’ll recognize quite a few names on the list, and you’ll be surprised to see how they rank. If you don’t like the way our tally looks right now, their voting booth will close at end of the business today (aka: Tonight!).

As always, here’s SAI’s company info provided by CrunchBase.com

Posted under Online Marketing

This post was written by Joshua Russak on September 26, 2008

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Web2.0 Expo Says: “Start Up in Silicon Alley”

Joel Smernoff (Paltalk), Karin Klein (??), Kevin Ryan (AlleyCorp), Me, Nate Westheimer (BricaBox/RoseTech)

Joel Smernoff (Paltalk), Karin Klein (Softbank Capital), Kevin Ryan (DoubleClick/AlleyCorp), Me, and Nate Westheimer (BricaBox/RoseTech)

Web2.0 Expo took place at the Javits Center September 16th-19th and came off as a great success for many of the attendees – myself included! One of the most valuable sessions took place on Thursday: “Starting Up in Silcon Alley”. I only registered for the Expo Hall, but was lucky enough to find my way in using some of my usual event tactics (hint: involves a scanner and photoshop).

The topic covered an important question for VC’s and Tech Entrepenuer’s alike: Where to start up? For the vast majority of the online world, when you hear Silicon Valley you think the heart of everything tech in the US all located in Northern California. But lately entreprenuers, VC’s and tech-startups are beginning to find value in areas outside of NoCal. One Silcon in particalur, Silicon Alley, “is a nickname for an area with a concentration of Internet and new media companies in Manhattan, New York City. Originally, the term referred to the cluster of such companies extending from the Flatiron District down to SoHo and TriBeCa, but as the location of these companies spread out, it became a general term referring to the dot com industry in New York City as a whole” (Wikipedia). And many VC’s and entreprenuer’s alike are beginning to see a lot of value in New York City. This was the topic of discussion for the panel which consisted of….

Nate, Kevin, Karin and David argue it out!

Nate, Kevin, Karin and David argue it out!

It was a legitimate topic as there are many successful start ups in NYC Silicon Alley. “A couple of years after the internet bust, Silicon Alley began making its comeback with the help of NY Tech meetup and NextNY. Since 2003 Silicon Alley has seen a steady growth in the number of start-ups. As of 2007 Google’s second largest office is located in New York as well as major online advertising and media companies such as Eyeblaster, DoubleClick, Roo and meetup.com” (Wikipedia).

Nate moderated the event and for about a 1/2 hour, conducting a Q&A style panel allowing the audience to ask questions as well (as you’ll see). To best cover this event, here’s a taste of what went on…

Nate: What does it mean to start up in Silicon Alley?

  • Kevin: “Great management talent in NY, […] We still have an undeveloped VC infrastructure…a real lagger in terms of development. […] I’m extremely Bullish! 10 years from now we’ll stil be smaller than Silicon Valley, but the gap is closing in day by day!”
  • Karin: “We are finding many compelling startups in NY. We have the building blocks key resources in NY – customers, partners and financiers. […] 3 examples of success: BuddyMedia, Thumbplay and Paltalk.”
  • David: “This is a very good time to start a company in NYC. The world is changing…what we don’t understand is how rapidly it is changing! The cost of a startup keep decreasing – In 1988 $20million to $2million to $200,000 during Nuclear Winter to now $20,000! You now have the resources!”

Nate: Do you have an “only in New York” story?

  • Kevin: “Being near the advertising community was an enormous advantage. So you have to be here!”

Nate: Do/would you ever request anyone that you invested in to come to New York?

  • Karin: Associated Content was based in Colorado, and they needed to be closer to advertisers. Also, retention of teams is easier.”
  • David: “Angel investors offer more than just $$money$$. We offer our offices, incites, and much much more. So it’s a benefit for them to be here.”
  • Kevin: “Staffing opportunity is definitely a plus. Also, to say Real Estate here is more expensive makes no sense. We determined our costs were $5,000 per person per year at DoubleClick and compared to other cities that cost only $1,000 less, that’s not so significant.”

Nate: Where do you see things going in Silicon Alley?

  • Kevin: “Rate of growth is going to slow down. It doesn’t have to do with the economy. It’s just that the rate-of-change is slowing down”
  • David: “I challenge that…the rate-of-change is accelerating. Anyone who says they know where the world is going is FULL OF SH*T!”
  • Karin: “The entrepreneur’s now are really committed and have strong conviction. I’d much rather back someone in this environment.”
  • Kevin: “Here’s some great advice for the future: Start when the wave starts! […] If you want to start video now, it might be a little late.”
  • David: “248 Venture Backed IPOs in ’99…0 Venture-Backed IPOs in Q2 2008?.” <-[A statistic I heard just a week earlier at the E-Marketing Breakfast at the Harvard Club NYC, found in the article “The Future of Search” over a bagel ‘n cream cheese!]

…at this point Adeo Ressi, Founding Member and CEO for TheFunded.com challenged the panel. With a smile on his face, he walked up to the audience mic and,  quoting him as accurately as possible, he said…

  • Adeo Ressi: “Silicon Valley kicks New York’s BUTT! There is 10x everything in the Valley!”

Adeo was an early pioneer in the growth of the World Wide Web and has been a successful entrepenuer over and over (GameTrust Inc, Total New York, etc.) He started his company, TheFunded.com started in NYC, but he moved it to Silicon Valley and off of that he made many good points. To further support him, “despite the development of other high-tech economic centers throughout the United States, Silicon Valley continues to be the leading high-tech hub because of its large number of engineers and venture capitalists” (Wikipedia) It definitely stirred up the panel and it was all in good fun, but at the same a reality check. David obviously was the first to challenge him and the audience definitely enjoyed the panels overal reaction.

David, Kevin, Nate & Karin respond to my question enthusiasticly...

David, Kevin, Nate & Karin respond to my question "what's the next wave? big thing?" enthusiastically!

After the conference, I took my picture with the panel (as seen at the beginning of this blog-most), then everyone made their way upstairs for a Lunch Session headed up by David Rose. It was very personable and David really pumped up the audience in terms of all the stages of starting up (concepts, funding, etc). A lot of individuals there wanted to pitch David which is why he continuously made this point over and over: “Only 1.32% of all Companies that pitch VC’s get funding.” I’m not sure if he was referring to here in NYC, or in the US, but either way that is a statistic you should NOT ignore as an entrepreneur.

David instructed entrepreneurs to create a working product, get users/consumers, show some profitability and then come to the VC’s! He also made another great point saying that “The most important person in the management team is the entrepreneur. We’d rather bet on a jockey than the horse!”

Afterward, there was another chance for Q&A and I had the chance to pop out my question…

Red: Kevin, you mentioned a great tip: Start when the wave starts! What do you see as the next big wave?

The whole team responded, but it was hard to pinpoint a single response. Kevin said once again that things were slowing down and there’s no wave at this moment. He also mentioned “mobile” but he was a skeptic with the iPhone. David obviously challenged him saying this space was “accelerating, but at a granule level.” Karin jumped in to point out that for “Video & Social Media, there was still good money to be made. [People just need to start] innovating these areas.”

Either way, they spent a good 10 minutes covering that topic before moving on. It’s good to see David and Kevin go head to head. I don’t know about the rest of the audience, but I was really fired up to be in the same room as 4 successful entrepreneurs and to actually engage in a discussion with them.

Web2.0 Expo was a success ! Keep on top of my calendar because there are still a few good events ahead in Q4 of 2008. And remember…Keep an eye for the “Red-Hair” at future events!

To end off here is a fun fact for you: For a list of other places with the “Silicon” name: Click Here.

Posted under Events

This post was written by Joshua Russak on September 25, 2008

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