The Evil Marketer

The U.S., despite slowly losing its dominance in science and technology as the world experiences further flattening, will continue to lead the world in its export of culture and popular media. I assume there’s not much debate about that — one can certainly imagine the next Microsoft or Google coming from India or maybe China, but not the next Madonna or Star Wars or Friends. Central to that cultural strength is our ability to market, as well as the increasing blend of marketing and media/entertainment we’re seeing every day. As the platform for that entertainment changes drastically from the boxes in our living room to our computer screen and mobile phone display and ipod, and as the source of that entertainment changes from centralized behemoths to individual users, marketing is going to change drastically as well. Those changes are going to fundamentally alter the way we experience our media, the brands we use, and even our relationships to each other and the ways we make an income, and because of our influence in these areas, they will change the world.
Here, briefly, are 9 of those changes. Why not 10? I’m an evil marketer and I wouldn’t feel right giving you exactly what you expected, that’s why. *evil laugh* Though not written in stone, the technology and/or marketing models already exists for many of them, and the others seem not only feasible but likely.

1. The Rise of the Influencer Network

The notion in marketing of an influencer — someone that drives customers to certain brands based on their level of trust and respect — has been around a long time. But never has it been more important. Influencers used to be much harder to find, had a much smaller base of customers, and were impossible to track; all of that has changed. Anyone anywhere with a certain level of expertise in a certain niche can use a blog to gain the trust of a certain amount of users; these blogs are easy to find, links from them are easy to track, and the potential user base of a blog is almost unlimited. All that’s left is a centralized system to organize these influencers and put them in contact with advertisers so that anyone with a little influence in a little niche can profit. Read more here, here, and here.

2. Free Internet, Mobile, and Cable

All of these services are already being consolidated into one package by providers. The amazing amount of data available to a single company that can track your internet usage, phone calls, and TV watching habits is worth a lot of money to advertisers. If you’re willing to let your provider share that info with advertisers (fairly anonymously), they can afford to give you the bandwidth for free, and will.

3. Language and Economic Barriers Disappear

Real time online translation is just a few years away. As soon as those language barriers disappear, not only can you have close friends anywhere in the world regardless of nationality (greatly expanding the power of social networks and the marketing tied to them), but us evil marketers will have instant access to markets that previously had these barriers in place. If you think our culture and the associated marketing machine behind it is powerful now (having already been given an enormous boost by the internet), just wait until our cultural influence can spread even more easily to people around the world and marketing messages and platforms are automatically multilingual. Combine that with a rapidly emerging middle class in India and China and potential audience for products grows exponentially. Influencers in each cultural niche will still be needed to craft messages, but that should be handled by #1 above.

4. Google Loses its Core Audience to Wikis

Google is no longer my favorite search engine; it’s increasingly more driven by large advertisers (both paid and natural search) and I’ve found much better results using wikipedia or a service like sidekiq if I want to look for something more specific. I’m not the only one who feels that way, either. Most people in the industry seem to use Google more for competitive research than actual search. Next to stop using it will be people like my mom, and once they’ve lost her, the one trick pony will have a broken leg. The effects of this shift are hard to predict; but because they currently control about 50% of search and a huge chunk of every advertising dollar, the shift will certainly benefit smaller niche networks and start money flowing there instead. There will also be a shift back to content sites that actually contribute something to the conversation rather than just linking everywhere.

5. No More Starving Artists

An exaggeration of course — there will always be starving artists who deserve to starve. But now that anyone with any level of talent can find an audience, they should be able to monetize their talent via sponsorships or even direct marketing. We already see a rise in independent filmmakers and writers giving their works away for free in exchange for traffic and influence; once there are more systems in place to easily monetize this traffic and influence most people with talent should be able to make enough to cover food costs each month.

6. The Mobile Phone Rules Your World

I know, it already does. But we haven’t even touched the marketing potential of the device. Once we accept the use of our cell phones as a payment device, and once phone technologies like mobile coupons, map coupons, cameraphone scanners or mobile price comparison become more mainstream, the ways we shop — especially when we are buying offline — will change forever. Coupled with GPS and better mapping technologies, you will be alerted to coupons as you pass stores, or have the ability to recommend a product or movie to a friend with a phone-coupon — and you’ll get a commission for that referral. That sort of incentive will allow viral marketing to be trackable offline and will allow everyone to profit from brands and products they want to recommend.

7. Brands get Personal

In the under-rated movie Idiocracy, the protagonist finds himself in a future world where us evil marketers have essentially destroyed culture; among other effects, people are named after brands — Frito and Mountain Dew, for instance. While this is (probably) far-fetched, there will be much closer relationships between people and the brands they use in the future. We already see overt branding of sports figures and venues — NASCAR has given almost everything available for branding; the wildly successful Nike/Michael Jordan campaigns 20 years ago equated his airness with his shoes; almost all sports stadiums are now branded. This effort has been grounded in pure mass market branding — spending billions of dollars to make your brand ever-present without actually measuring the impact of the spend. What if instead Apple could “brand” the top 3 coolest students in every high school and actually measure the impact of them wearing their shirts, always having an iPod or iMac with them, promoting Apple on their MySpace account, etc? Social networks that concentrate on schools make the identification, the measurement and the organization of such a campaign possible. Which do you think would be more effective, spending a billion dollars on a TV commercial campaign or giving away $10,000 scholarships each to “brand” 100,000 teenagers?

8. True Behavioral Targeting

Behavioral targeting is in the stone age of its evolution at best. A consumer visits a car site, pop him (or her, you probably don’t even know) a car ad on the next page load. Yawn. What we evil marketers need are three things: more data, better data, and mo’ better data. We don’t have enough data on all of you yet because of those ridiculous concerns about privacy. Here’s a piece of news for you — we don’t care that you are a rich guy into women’s lingerie or a poor grandmother who visits the High Times website or a middle class teen goth who is downloading Barry Manilow mp3’s. Well, let me rephrase that — we do care about your gender, your economic status, and the things you might want to buy, but we could care less who you are. When all is said and done, we have the same interests as you do — not to show you ads that don’t matter to you or irritate you but instead show you ads for things you want and can afford and need right now. Let us know more about you — anonymously — and we will invest billions of dollars of our own money to develop technology that can target ads to you that will be so timely it will seem like we are in your head. You will know immediately that Macy’s is having a sale on panties or that the head shop around the corner is giving away a free one hitter with every bong purchase over $20 or that Barry has just released a limited edition box set, and you will love us for it. And as mentioned in #2 above, we’ll even give you stuff.

9. No More Ads

You read that correctly. And I didn’t mean, “No! More Ads?” either. Every time us evil marketers come up with a new way to push an advertisement at you, you figure out a way to ignore it. Spam, pop ups, tv commercials, banner ads — all of them are blockable or skippable or at worst ignorable. Even Google AdSense text links are starting to fade into the background for many savvy users and should start to lose their effectiveness over time. You’ve taught us something — you hate ads. Yet we spend billions giving you more of them. Why? I’d argue at this point it’s sheer laziness combined with old-school thinking and just general stiffness. There are so many more effective ways to make you discover our products — word of mouth, sponsorships, incentive marketing, product placement and more — all of which happen (or at least appear to happen) naturally and unobtrusively and will work much much better and are much much more measurable. None of the other 8 innovations above need standard ads to work, and most of them won’t even work with standard ads. Don’t get me wrong — you will be exposed to branding everywhere and your friends may be recommending products in exchange for commissions and you will have coupons and cash back offers popping up on your cell phone at appropriate times, but they won’t be ads as you know them now.

What do you think?

Love,

The Evil Marketer

Via the wires, SuperPages.com is launching a “reviewer of the week” system that has all the right things: it’s local, it ranks reviewers, and the reviews promote products and services. Hell they even use the term “trusted individuals” to describe the reviewers. Over time reviewers who are more active get ranked higher; that’s not the best case scenario — they should let users have more say as to which reviewers are doing the best job. Eventually there will be a handful of reviewers in each locality for each niche, and these influencers will then be in a position to demand a cut of the action (as they should).

People will only spend energy doing things for free until they find out that someone else is making money from their effort. That’s when things get interesting. Monetizing CGM is, after all, not as much about us evil marketers accessing audiences as it is about users flipping the hierarchy on its head and taking power away from the companies that rely on them.

In part 1 I set forth a basic argument that word of mouth or influencer marketing (or open source or citizen marketing or any number of related terms), while always the most powerful marketing technique has thus far been an off-grid activity usually unmeasurable (and thus unmanageable as far as ROI is concerned) by us evil marketers. Because the internet and associated technologies now enable the tracking and management (to a limited degree) of influencers, the time has come for an organized influencer network that should behave in much the same way as an ad or affiliate network.

There is one major reason such a thing has not yet been created — as soon as you create a system to reward people for promoting brands it’s going to devolve into a situation where the “recommendations” carry just as much weight (and sometimes less) as a normal advertisement. In other words, open up an influencer program to anyone and any brands, and you end up with a basic affiliate network. Affiliate networks are great, but they inherently suffer from the same problem as other traditional online advertising in that ads may be convincing, but we don’t inherently trust them. There are few exceptions to this, and those fall into the realm of affiliate links disguised as blog posts or other such “stealth” endorsements (with a small percentage of those being legitimate recommendations that simply run through an affiliate link).
The influencer network would have as its publisher base those select people from each vertical who command enough respect and trust that they can act in the same role as a “paid” or “celebrity” endorsement. These marketing relationships occupy the one, most valuable niche in all of advertising — obvious advertisements that consumers still inherently trust (at least when compared to normal advertising).

The influencers in the network would choose the brands they wish to endorse (at least initially), based on genuine respect and love for the brand, but would be compensated for that endorsement. The method of endorsement and compensation for it could vary widely based on vertical and influencer “level”; a rating and/or trust system would be in place for users (both inside and outside the network) to vote in various ways to change that level.

The devil’s in the details of course, and here are a few of them:

• The influencer would need to promote products or brands in a mostly measurable way, via tracked links, coupon codes, printable coupons, or email subscriptions; they would also need to brand their site/sites in a way that is agreeable to both influencer and advertiser
• The influencer could set desired rates and promise a certain level of traffic; these rates would generally be a paid contract over a certain term, but could include bonuses based on CPA or CPC
• The influencer must agree to never promote rival products or brands while under contract
• A rigid approval and vetting process would need to be in place for entry as an influencer; applicants would need to show proof of influence as well as traffic and/or previous affiliate commission numbers, and the applicant would need to concentrate on one vertical
• A network managed by one individual but consisting of several sites and blogs could apply as an influencer and thus use its aggregate influence under one influencer account

You have questions, I’m sure. Here are answers to some of them:

Isn’t this the same as traditional sponsorship or endorsement deals available in offline advertising?

Yes, but with a crucial difference: offline endorsements and sponsorships are always celebrities or media with a mass appeal and almost always concentrate on pure brand marketing. An online influencer network would allow advertisers to get endorsements from very niche markets, and could even target local markets just as easily, all in an open marketplace that had the full weight of ROI measurement behind it and thus turn endorsements into direct marketing.

How will an advertiser know to trust the impact of an influencer?

The network’s main concern will be managing the value of influencers, and can do this with metrics from previous relationships as well as ratings from other inflluencers and consumers. Advertisers can always sign short term contracts to “test” the influencer, and the results of that test will be a part of the influencer’s value moving forward.

How will the influencer network make money?

By charging a percentage of each contract to the advertiser, as is common in affiliate networks.

How is this different from an affiliate network?

There is some crossover, but affiliate relationships are almost always CPA and put the burden of risk on the publisher despite what potential influence they bring to the table. An influencer network puts the burden of risk back on the advertiser but softens it via the metrics that online advertising gathers. It creates a much more formal relationship between publisher and advertiser as well.

Aren’t there sites and blogs already doing this?

Yes, of course. The problem is that the advertiser is responsible for finding these sites, working out the contract, and managing the relationship, and publishers don’t have a central place to go to find all of these advertisers. There are a handful of existing ad networks that claim to do sponsorship deals, but they are usually with their own properties. Furthermore, offline mass marketing endorsements are easy in the sense that the advertiser already knows who to approach; online verticals are made up of hundreds of niches, all of which may need a certain “spin” on the marketing effort, and it would be nearly impossible for any agency to find and rate all of them. A standard as well as a network is needed to coordinate this.

Do these endorsements always need to be online?

No, and that’s where things get really exciting. Online advertising is finding ways to move offline, via mobile phones, GPS, instore linkups with online content, and more. And that’s just the beginning.

To discover more about the potential future of influencer networks, stay tuned.

Love,

The Evil Marketer

There is a healthy (or unhealthy as the case may be) majority of traditional advertising analyst types who simply don’t understand what is happening right now in marketing. They see all this web 2.0 innovation, consumer generated media (CGM), massive shift in publisher power, rise of social networking, less control over brand, etc, as a “fad.” If you’re one of these unfortunate souls please take a moment to listen to the Evil Marketer give you the low down on the paradigm shift going on in your industry to which you are somehow recklessly oblivious.

Here’s a very good example of the arguments that these pundits raise in defense of their position. Let’s break them down one by one and show them the error of their ways, shall we?

1. “…it’s hard to imagine how there won’t eventually be a backlash against ubiquitous user-generated video clips, blogs and the like.”

Good point. I mean, there has certainly been a backlash against all those billions of informational web pages out there that users can access for free on their own time. It’s just too much information and too easy to find and almost always gives me exactly what I am looking for! People are turning off their computers and flocking back to the library and the Yellow Pages in droves. I’m sure people will grow tired of endless, free entertainment that is unavailable anywhere else and manages to speak to them in specific ways no other media ever has in the history of the world. They’ll just throw up their hands in frustration at all that entertainment and go back to watching Matlock.

2. “At what point do we have social saturation when every person and every marketer tries to film every idea they’ve ever had? The best content will always rise to the top but there will be a ton that probably won’t get covered and people may stop posting when it becomes evident that nobody is interested…”

Yes there is something wrong with a world where everyone is free to create art and get it seen by billions of people. And we all know that TV and movie and music production companies are experts at producing great content that appeals to every person. Please. The point here is there is an audience for almost anything, no matter how small. And artists will create art even if no one cares; it is the nature of who they are. They will not stop, and if anything their output will grow because somewhere out there is someone who will like what they produce.

3. “…what ‘You’ need to do is actually generate profits and revenues in order to have a real say. And it’s unclear just how effective ‘You’ will be.”

Ah, this is the crux of their argument: if you produce some crap that only 5 people watch then you can’t monetize that and it’s essentially worthless. Stop thinking in traditional mass media terms people! Of course you can’t monetize an audience of 5. But if you have a million videos that each has an audience of 5, not only can you monetize it, you can target your marketing like a laser AND measure response in real time all the way to purchase. Not to mention much of the “advertising” will be the content itself, tailored in a very specific way to a very niche audience, produced for FREE by your own customers. How can you not get that?

4. Here’s a longer excerpt supporting their argument in #3:

To wit, one of the most buzzed about online videos, of two Chinese kids lip-synching to “I Want It That Way” by the Backstreet Boys, has been viewed about 1.3 million times on YouTube since the video was added to the site in November, 2005.

Meanwhile, a show like NBC’s “Studio 60 on the Sunset Strip” or CBS (Charts)’ “Smith,” which was the first cancellation of the fall TV season, are branded as failures even though they generated nearly 10 million viewers a week and are supported by advertising.

Oh my God can you be more clueless? You’re actually comparing the relative strength of a stupid video 2 guys in China made with a webcam with shows starring recognized actors, produced for millions of dollars, written by a team of professionals, and which were probably tested before audiences for weeks??? The point is that a million people have watched that video even though it cost nothing to produce and starred nobody. It wasn’t monetized because people like you haven’t figured out the best way to do it yet. As soon as YouTube gets off its ass and starts running 5 second pre-rolls to its most popular videos, a video like that could generate millions in revenue — again all of it tracked down to the timestamp of purchase. And it might only cost you per click (or maybe even, dare I say it — CPA).

5. “But so far, the amount of money people are making is negligible.”
followed by
“YouTube probably will be a winner [as well as MySpace].”
followed by
“But the scores of startups that have cropped up in the past two years to challenge the YouTubes and MySpaces may find it difficult to profit from ‘You’ no matter how creative ‘You’ are.”

Ok, first you argue that you can’t make money distributing CGM. Then you say that YouTube and MySpace actually will make money. Then you qualify that by saying no one else will. That sound you hear is the Evil Marketer sighing very deeply.

6. “‘This idea of having customers generate ad campaigns would be a good idea if it really was consumers,’ said Stevens. ‘People winning these contests are not coal miners, cab drivers or people who sell shoes at Bloomingdale’s. They are people at small agencies or independents.”

And your point is? That this whole CGM thing won’t work because a shoe salesman can’t produce a winning SuperBowl commercial? Not only are you obviously wrong about the potential influence of CGM, you’re also wrong about the power of that shoe salesman, and THIS is where you are really missing the boat.

Let’s take a look at a lifetime shoe salesman; we’ll call him Frank because I suspect that’s what his real name is anyway. Maybe he’s making what, 40k a year? How much knowledge does he have about shoes? How much influence does he have when a customer comes in and needs to make a decision? If he could more efficiently monetize that knowledge and that influence somehow, do you suspect he could make a lot more? I do. The system may not yet be in place for this, but I believe one day there will be organized networks of influencers like the guy who’s sold 50,000 pairs of shoes in his lifetime. If I’m looking online for a pair of shoes and there was a network in place to allow Frank to assist me in a decision, and if he was paid a flat rate by a specific online store just to have access to him plus a commission on the shoes he sold (all trackable of course, including what pair of shoes the customer originally wanted and even what ad they clicked on in the first place to get to the site), not only would he be making a lot more money selling a lot more shoes (from home), but I would be willing to continue to buy shoes from that vendor there just so I could get Frank’s help, because I like Frank and he is a hell of a lot smarter than any automated “suggestion” system or FAQ page.

What does that have to do with CGM you ask? Good question.

The point is that the internet allows everyone a way to better exploit and monetize their talent. It has enormous economies of scale, ultimate reach, and requires very little real-world overhead or infrastructure. All advertising is, at its essence, is a way for clever people to get people talking about or interested in a product. Remove the infrastructure required in running a major ad agency, expand your potential customer base to the billions, and tap into the resources of thousands (maybe millions) of smart people, people who have influence and expertise and maybe already love your brand, and only pay them if they produce results.

Or not.

Love,

The Evil Marketer

Courtesy of Andy Beal , marketers are finally finding a way to use email to market that doesn’t make everyone detest us. I generally stay away from email marketing, mostly because I don’t respond well to it myself. One of the few places it works is when it’s included seamlessly in a newsletter from a trusted source. Amazon does this well, for instance — they rarely email me but when they do it’s almost always to let me know about something I actually want to buy. They have led the way in leveraging the information they gather; information that is submitted for free from its users, of course.

Social networks are an ideal place to turn what is usually an obnoxious way to grow an email list — finding third parties to get users to opt in — and turned it into exactly what it should be: allowing the niche and its alphas to determine the best newsletters that speak to the community, and encouraging the community to sign up. Advertisers just have to find these communities and work with them to find out what content they want, then cross promote or upsell or even sell third party ads in the newsletters that contain that content.

This is just the first step — next step is allowing the members of the community who gather emails to get a commission per email gathered. This allows the newsletter to not only command the attention of a particular niche, but allows the individuals within that community to push the newsletter to other closely related niches, and even give the advertisers ideas about new content to add to speak to those niches as well.

You can all see where this is headed, my evil friends. The final step is allowing the newsletters to easily include content from the influencers as well as allowing different versions of each newsletter to be distributed to different niches automatically based on the source of the original email (and that source’s place in various communities). Throw RSS into the mix, along with competent data mining of open and response rates for various newsletter sections (based on niche interests, source of original sign up, number of downline referrals from recipient and what their niches are, etc), and you’re getting close to where things are going to be — the advertiser no longer publishes the newsletter at all; the community does all the work to push the products in exchange for a cut from the users they originally referred, and because the commission hinges on converting that downline, they work harder to prepare content that persuades those users to convert.

More food for thought,

The Evil Marketer

DRM and all its ramifications and iterations are a marketer’s enemy, my friends. That’s right — not only is it bad for consumers, it’s also bad for us. We all know why it’s bad for consumers — it simply takes away the rights they should have to the content they purchased and then tries to re-sell it to them. It’s ridiculous and it’s based on an old paradigm that no longer exists.

But the Evil Marketer doesn’t hate DRM because it’s unfair. I hate it because it restricts one of the most powerful word of mouth distribution systems ever created. Step back for a moment and let’s forget we’re talking about DRM. What if, my evil friends, I told you that I had devised a system to help advertise music (and other digital artistic content) that:

• Didn’t cost anything
• Was built on a platform others had supplied for free — and constantly upgraded and improved
• Encouraged users to advertise for you, but with no compensation for that referral
• Allowed for easy cross-promotion among similar artists and genres
• And finally, resulted in sales of music that were easily tracked to these referrals and cross-promotion, and didn’t cost anything in materials to get the product to the consumer

The only downside? Sometimes people would give the music away for free to people who may have otherwise purchased it. But since that’s been going on since the invention of the tape cassette and VCR, and the only difference is the scale of that potential loss, we just need to make sure it doesn’t get out of control by giving honest users an easy way to purchase at a fair price.

And that’s just the surface, folks; that’s just things as they stand now. How great will it be when we can more easily insert 5 second ads into the shared content, or add further analytics to the chain of distribution, or any number of advances that are just around the corner that will let people always have instant access to every piece of music every created, while further tying the demographics of those listeners (based on genre and all the other juicy private data we’ll be gathering) to cross promote products from other verticals?

I’d be more angry about DRM if I wasn’t so sure that its days were numbered and inexorably linked to an old guard that is slowly dying out. I just wish their deaths were quicker. The sooner they get out of the way and free up content so that we can measure and monetize it more efficiently, the better.

The Evil Marketer finds it amusing when consumers start freaking out about things like third party cookies (though that hubbub has thankfully died down of late). Yes, dear consumer, we have ways to watch you as you jump from site to site, and we can combine that information with what you purchase at those sites and what ads you see, to eventually develop a mildly accurate idea of what kind of online consumer you are. On the evil scale, it’s maybe 1 out of 5 pitchforks. To be frank, it’s sooo 2005.

What really gets our evil mouths watering are articles like this that show just how little privacy you have left. I get so excited about stuff like this I can barely type :). The research here shows what any of us might have guessed already — that if you have a relationship with someone who has purchased a specific product, you are much more likely to buy that product yourself. This has been true forever, of course. But for the first time we are actually able to track and measure it — actually quantify the value of existing consumers and the influence they have over their peers. In this case, the stat they arrived at was this — consumers are 3-5 times more likely to purchase a product if someone in their social network already has it. And just how did this article get its data you ask? By mining the details of a telecommunications ad campaign that tracked whether converted customers had talked on their phone to someone who already owned the product.

Let me pause for a minute to let my heart rate decrease and then I’ll say it again.

The telecommunications company knows if you talked to someone else within their network, and used that information to see if users were more likely to purchase the new product they were pushing.

The implications are staggering, of course, though the Evil Marketer has seen it coming for some time now. You poor little consumers installing your anti-spyware/third party cookie blocking software on your computers are, meanwhile, probably subscribing to one company to receive your cable tv, phone and internet. Has it ever occurred to you that your provider knows what tv shows you are watching (and/or Tivo’ing), what web sites you are visiting, and who you are talking to on the phone? All with timestamps? All aggregated into (potentially) one database? And charging you for it??? MUHAHAHAHA

As soon as they figure out how to wrap up that info into a nice tidy package and sell it to advertisers, the whole world will change. And it’s not just service providers — social networks sites like MySpace are treasure troves of private data — and the sweetest part for us marketers is that one of the prime demographics live on these sites and willingly give up all manner of information about what they like — music, movies, gadgets — and what relationships they have with others who also give up that info. As soon as these sites leverage that data and strike up a juicy deal with Google or the like, “online privacy” will become as quaint as vinyl albums or rotary phones — or mass marketed million dollar 30 second tv spots.

Don’t fret my dear consumer, there is good news for you too. Leveraging this info will probably allow service providers to drastically reduce their fees — you may even get tv, phone and internet for free some day soon. And you’ll start seeing ads that actually interest you and promote products you were already researching. It will seem a little creepy at first that you see a coordinated campaign for a new dog food on your cell, tv, and computer home page moments after scheduling a vet appointment, but you’ll get used to it.