jonsteinberg

Unemployment stands at just under 10%, and even more striking, amongst college graduates it's 5%, the highest level since 1970, when records began to be kept. (So it's potentially the highest level since even further back.)  Despite all this unemployment, every startup I know needs to hire not only engineers, but also sales and operations team members.  And this is not just bubble seed startup dollars at work.  Most of this hiring demand, at least that I'm aware off, is Series A, B, and C startups that are throwing off lots of cash and could easily be profitable if they chose to move out of growth mode.

There's a massive misalignment between the labor pool and the job pool, and I blame our undergraduate institutions.  They're still training people for an industrial economy.  While not every person graduating can be an engineer, business folks are not going to be managing and working with production lines, or for that matter filling roles in investment banks and management consulting firms.  The business jobs in this economy comes from: selling digital media, trafficking ads in DART, negotiating CDN prices with suppliers, creating P&L's where the COGs is Akamai, tracking and filing bugs in Pivotal Tracker.  A business person in 2011 needs to be able to dialogue with a Product team about the features customers need, and this business person needs to have an inkling of a sense as to how code is built and what can be shipped and how.

And yet, the case studies in business schools still involve cranberry farms, beer shipping, and Microsoft vs. Apple.

This results in fighting for a pool of talent that's already gainfully employed. Google's Eric Schmidt went so far as to call it a "war for talent." The only bright side to all this, is that the jobs do exist and that given that the companies themselves that are changing the game are only a few years old, this can be corrected in a few years. I did study Latin, but as a friend and I both agreed, when we visit schools for our kids now, we ask why they're not teaching code. I don't care if it's C, Perl, or Ruby, but when my kids are in 5th and 6th grade, I hope they're learning software in addition to a spoken language. Not because I want them to have professional training in grade school, or because I think the languages will be the same when they go to work. Just as spoken languages shape the mind, an experience with software early on will help to shape logical connections in their minds that will position them for the world they'll operate in. So I would say yes to Spanish, but punt the Latin for Perl or C. (written on iPad - sorry for autocorrect errors)

I was excited to see a study this week that 68% of companies plan to
shift marketing funds from traditional forms to branded content in the
coming year. And 35% of branded content spending in 2010 was
electronic.

The growth of branded content online mirrors what we've known for a
long time. Writing in the 1970s and 1980s in "Ogilvy on Advertising,"
David Ogilvy, wrote, "long copy sells more than short copy." He
expounds on this logic by arguing for ads that have newsworthy
information, specific facts, credible information, and learnings. The
6,540 word ad he ran for Merrill Lynch pulled 10,000 requests for a
booklet "burried" near the end of the article.

Consumers always wanted information in lieu of a "buy buy buy" call to action that stood in a vacuum. It seems only recently with 30 second TV commercials that anything other than branded content was even considered.  Rather than something new, branded content is old and proven.  And it seems to me, that the online movement towards branded content is a continuation of Ogilvy's call for a "renaissance in print advertising," rather than something new.

A lot of people don't read books because they're still of the mindset
that they're in high school. That is, they feel obligated to finish
books they don't like and read every page without skimming or skipping
sections.

Similarly, many people don't work out because they find it boring or
are too busy with career and kids. In this regard, I would recommend
my own strategy of the half-assed workout.

I blog, read tweets, correspond on work matters. In fact, this past
Friday, my workout was my most productive hour of the day: I
discovered a new piece of business for us to pitch for, got the
details from the agency, and SMSed on a product challenge with
@Peretti.

In high school, I recall running into a wall street type in my
elevator at 10pm going out to run in the snow. The guy was always
doing this. When my 15 year old self asked why, he responded, "I trade
derivatives, if I don't run, I die."

That most stuck with me and foreshadowed how crazy wall street was and is.

But today it occurs to me how important changes of scene, especially
in a physical context can be. If I don't run, I don't die, but the
elliptical and spin class can be the source of some of my best ideas
and solutions.

This means that during spin class I don't "clear my head" as
instructors prod. Rather my head is lost in thought. This make my
workouts half assed. But it works for me, and at least my heart pumps.

And yes, I wrote this on the elliptical at the gym.

My reading list on the ad industry began with Ogilvy's Confession of an Advertising Man.  I was so compelled by the book, and its relevance to the online ad industry that I bought it for everyone in the office.  Over the weekend, I read Jerry Della Femina's book, the literal inspiration for the show Mad Men.  These two texts serve as a solid background on the sales, service elements, and agency building elements of the industry.  

Confessions also begins a discusion of "good advertising," which Ogilvy delves much deeper into in his masterwork: Ogilvy on Advertisng.  This work is more relevant than ever, because at the time of Ogilvy's writing, print had taken a backseat to TV.  One could argue, and I would, that display advertising has more similarities to print than TV.

Some of my favorite lessons include the fact that you should always put your image above your text to insure that the ad flows with the natural scan behavior of the reader.  Or that new claims/uses are an effective ad method- that education can serve as the ultimate ad.  Ads with "news" are recalled 22% more.  For example, a new use for soup:

Ogilvy's insights are based on extension survey methods, so his claims are facts.  For example, people can't read reverse print (white text on black background); always use black on white. And that longer ads are actually read MORE than shorter ads.  Headlines are read 4 to 5 times more than body text.

His most famous ad for VW, strikes you with a one word headline, that appears to be disparaging the product in the ad. On closer read, you learn that VW's inspection techniques are so stringent that one in 50 cars is discarded by VW engineers as a "Lemon" before leaving the factory.

To my eyes, the layout and imagery is all Apple.  Steve Jobs most certainly read this book.

I love business books from the 1950s to 1980s.  Very little has changed in business, and the prevailing business writing style seems to me to have been a lot more candid in those days.  The insights seem unscrubbed, and time has done nothing to diminish the lessons.  

On any given day or week the most viral content on BuzzFeed and I believe our network (though we have much more data coming on that) tends not to be videos.   It is images, articles, list posts, and every other permutation of content. 

24 Hour View

The top three items today are: a list of lyrics, an image of a funny SMS exchange, and an image.  The first video actually appears as the 7th item.

7-Day View

On the 7-day view, item number 1 includes a video, but is much more of an elaborate guide than a standlone video. Other than that, there are no videos in the top 10.  We'll be putting out more data shortly, but I'm so frequently asked, "what goes viral other than videos," that I wanted to do a post.  Heading to our public dashboard can quickly give you an idea of the stuff that works best. 

I would say that lists are a highly underutilized form of content.  They do remarkably well for us, partners, and advertisers, and get shared a ton.  To my knowledge, we're somewhat unique in our mega image lists (sometimes 100+ images), and it's a format we're encouraging brands to adopt.  It's a format that users like and like to share.

The same is true of really surprising and though-provoking standalone images, articles, guides, and audio files.  Funny works but so does unexpected, curious, heartfelt, smart, etc.

 

Let me begin this post with two admissions:

1. I'm always looking to draw business analogies from my favorite TV show of the moment (Previously Mad Men and currently The Walking Dead on AMC)
2. I'm completely biased from a business perspective/interest in my belief that links and traffic that come via sharing activity are the most valuable

With those caveats out of the way, I'm wondering how much of the online audience is Walking Dead: click farms, zombie accounts, spyware spinning people in circles, etc. I love Twitter and am a Twitter bull, but of those 160 million users, how many are actually active in any real sense. The number is still huge, but when you're tweeting, you're still hitting a lot of the dead.  Just a quick survey of your followers immediately makes clear that many, and potentially most, are spammers or abandoned accounts.

Jonah first raised the idea of zombie users with me, and we've been noodling on it for days now. He also pointed out that one of the best metrics used to counteract these unrealistically high numbers was the "active users" metric deployed by Facebook with regard to Facebook Apps.

The Walking Dead also relates to the current obsessions around micro-targeting according to cookies: "buy me pet lovers on the upper east side who have purchased a latte and a hammer in the past 3 days," how many of these "people" are like the residents of Atlanta that officer Rick Grimes confronts in the picture above. Cookie eaters maybe, but also dead.

It should come as little surprise that:

More than 2.2 million US PCs were found to be part of botnets, networks of hijacked home computers, in the first six months of 2010... (Microsoft via BBC)

When I meet with agencies and brands, it is making increasing sense to me why the love Facebook: all the users are real.  Of all my Facebook friends, I think only one to five (maybe less) are zombie accounts.  Further, this is why we're so focussed on "sharers" at BuzzFeed: it's a real indication of pulse and human on both sides of the view and share behavior.  

Over the next six to twelve months, I'm hoping and predicting the dialogue continues to move from raw views and targeting to one that includes humans vs. walking dead.  We're already beginning to see it; it's at the very roots of "social" marketing, and I think it's why social marketing is so important and could almost be called: "marketing to the living."

The best case for halo effects that I'm familiar with relates to Google. Google search is such a fundamental part of Internet usage - oxygen to air- that anything that drives web usage drives Googling. This is why Google wants you to be in the browser all the time, and it is the halo that justifies costly endeavors such as Android, Google Docs, Gmail, and free airport wifi at Christmas.

This could be called a strategy of compliments- cheap razors to sell blades, but brand halo feels like the right term. It's Google on our minds, Google everywhere in these free products that keeps us Googling as much as the search quality. Chris Anderson makes a similar argument in Free; give away something to sell something.

We've been thinking about this at Buzzfeed. We want to be the best in everything viral. From a free viral content destination, to a viral analytics product, to the best viral trends aggregation.

We're monetizing by being a viral advertising technology company. We allow brands and publishers to make their content more viral; we sell the impressions and prove our value with the earned media and the "plus" in the term "impressions plus."  But we are working to create a halo by offering a suite that solves any viral needs faced by end users and business. This also creates expertise for our teams that transfers into the revenue product; it becomes an internal halo for us.  

Nothing comes free with a purchase.  The idea of the bundle is concept of behavioral economics that persists because people seem to so readily relate to it an enjoy it.  If you pay $5 for a sandwich and get a soda for "free," the soda and the sandwich cost a total of $5.  They wouldn't give you the soda for free if you didn't buy the sandwich. The vendor just finds that phrasing the offer as "$5 sandwich and free soda" is more relatable and appealing than "sandwich for $3 and soda for $2, and you have to buy them both" or "sandwich and soda for $5."

People to this day ask me if I miss the "free meals at Google."  To use Mayor Bloomberg's quote when he visited Google, "If you think the food is free, you don't get the model."  There is no free lunch and that is why the phrase "there is no free lunch" exists.

Bundles are also used to include items that have less discreet prices.  Publishers often offer media buyers and advertisers "value adds" or "bonuses" on top of the media buy.  These can take the form of custom integrations, creative services, or tools.  These items are obviously valued in the package, but are phrased as "value add" because it's easier to attribute the discreet value to the CPMs or the CPCs.  This is similarly why when you buy a meal at a restaurant, the napkins, condiments, music, and seating area are free- they are all of value, but how would you charge for such things?  And in many cases, the ambiance, service, etc. are the parts of the bundle that you find to be of the highest value. A steak is just a steak, unless it's at The Palm.

Bundles can, of course, be nefarious too; as when things are only offered in bundled form, or when items in the bundle are worthless.  Monopolists often include lots of things in bundles to justify high prices and are unwilling to offer the core product that everyone wants at a reasonable price.  Cable service comes to mind, as most of us only want about 10 or so channels and high speed internet at a reasonable price; who, for example, wants the music channels?

Being flexible in what you charge for and what you make free, can, however, makes purchases easier.  For example, on Wall Street it is easy for funds to pay trading commissions and get research reports free as part of the bundle.  This, for example, is how Goldman Sachs charges hedge and mutual funds: trading commissions per share, research reports for "free."  Paying cash dollars for research and getting trading for free would be impossible.  

The only challenge is not devaluing the "free" product or sending signals that would make other buyers who want just the "free" product to expect it to be cheap, or feel it should be cheap, in the absence of the bundle.

Each buyer will have constraints and biases about what they want to pay for and what they want to be gratis.  I think as a seller, one needs to be flexible in how the bundle is phrased in order to not lose sales due to semantics.  With that said, too much flexibility can lead to confusion, non-standardization, and starting from scratch with each sale.  A few different bundle options that appeal to different groups of buyers, and at the same time are consistent across groups, is the way to go.

This morning on my way to take my twenty month old to swim class at the Y, I stopped off to buy some cables for the office at Best Buy on 86th Street and 3rd Avenue.  I booted up Shopkick on my way to the register, because the discounts had appeared broad and generous in the past.  After struggling to connect via 3G, I found an offer for 10% off computer accessories.  I wasn't sure if cables qualified, but figured I'd ask.  I showed this screen to the register clerk: