The Paradoxes of Interactive Media<br />Social Media   Social Commerce<br />Professor Eric T. Bradlow<br />Co-Director<br...
The Paradoxes of Interactive Media<br /><ul><li>The Golden Age of media metrics…
The rise of data mining…
Customer engagement…
1 to 1 marketing…
Ethnic/gender/lifestyle marketing…
Viral marketing…
Mass marketing is dead…
The Long Tail…
Ad creation is a delicate art form…
Content is king…</li></li></ul><li>The Golden Age of media metrics…<br />
The Golden Age of media metrics…<br />…is now<br />
The Golden Age of media metrics…<br />…was 40 years ago<br />
The Golden Age of media metrics…<br />…was 40 years ago<br />
Social Commerce Takeaway 1:<br />It is the golden age of data, but we knew 40 years ago exactly how to optimally allocate ...
The rise of data mining…<br />
The rise of data mining…<br />…but data will never trump simple theory<br />In genetics, for instance, it&apos;s becoming ...
The rise of data mining…<br />…but data will never trump simple theory<br />We put forth a model that incorporates the bas...
Social Commerce Takeaway 2:<br />Simple models of behavior outperform complex models out-of-sample over and over again.<br />
Customer engagement…<br />“Engaging your website visitors – not just informing them – is the next critical metric marketer...
Customer engagement…<br />
Customer engagement…<br />
Customer engagement…<br />
Customer engagement…<br />…but many customers are just looking for a “quickie”<br />
Customer engagement…<br />…but many customers are just looking for a “quickie”<br />
Social Commerce Takeaway 3:<br />Be careful the metrics which you optimize against. There is no single metric. There is no...
1 to 1 marketing is the future of B2B and B2C Markets<br />B2B and B2C markets today provide the promise of unlimited targ...
but customers are too “antsy” (unpredictable) for it to succeed<br />Many companies have lost fortunes by building<br />la...
Social Commerce Takeaway 4:<br />Money is made by grouping similar customers based on behavior as scale is obtained.<br />
Ethnic/gender/lifestyle marketing…<br />
Ethnic/gender/lifestyle marketing…<br />DVD purchasing by country of origin<br />Non-Hispanic<br />Hispanic<br />Mean<br /...
Ethnic/gender/lifestyle marketing…<br />DVD purchasing by country of origin<br />Non-Hispanic<br />Hispanic<br />Total Spe...
Ethnic/gender/lifestyle marketing…<br />…the cross-group differences are often “mean”ingless<br />DVD purchasing by countr...
Social Commerce Takeaway 5:<br />No one is at the mean, all the action is in the variability of the group. Don’t chase (me...
Viral Marketing…<br />
Viral Marketing…<br />
Viral Marketing…<br />So how are sales? They started out strong, when Aqua Hoops appeared on the &quot;most recent&quot; p...
Viral Marketing…<br />…usually it’s barely a sniffle<br />
Social Commerce Takeaway 6:<br />Viral Marketing is locally effective, but globally small. Great for B2B with concentrated...
Mass marketing is dead…<br />
Mass marketing is dead…<br />…long live mass marketing!<br />
Social Commerce Takeaway 7:<br />Mass Marketing is far from dead and is equally effective as ever, it is just really hard ...
The Long Tail…<br />
The Long Tail…<br />…it’s all in the head<br />Don’t radically alter blockbuster resource allocation or product portfolio ...
… hits are in highest demand just as they are in the retail market.<br />This isn’t the first time the Long Tail theory ha...
Social Commerce Takeaway 8:<br />More media channels are not cannibalizing, heavy users use each channel heavily (ESPN pri...
Ad creation is a delicate art form…<br />“Advertising is the greatest art form of the twentieth century.”<br />Marshall Mc...
Ad creation is a delicate art form…<br />…but statistical science is a good place to start<br />
Upcoming SlideShare
Loading in …5
×

Eric Bradlow: 10 Paradoxes of Social Media

1,704 views
1,617 views

Published on

Published in: Business, Technology, Education
1 Comment
2 Likes
Statistics
Notes
No Downloads
Views
Total views
1,704
On SlideShare
0
From Embeds
0
Number of Embeds
10
Actions
Shares
0
Downloads
0
Comments
1
Likes
2
Embeds 0
No embeds

No notes for slide

Eric Bradlow: 10 Paradoxes of Social Media

  1. 1. The Paradoxes of Interactive Media<br />Social Media  Social Commerce<br />Professor Eric T. Bradlow<br />Co-Director<br />Wharton Interactive Media Initiative<br />The Wharton School, University of Pennsylvania<br />OfficeArrow, LLC. 2009. <br />www.whartoninteractive.com <br />
  2. 2. The Paradoxes of Interactive Media<br /><ul><li>The Golden Age of media metrics…
  3. 3. The rise of data mining…
  4. 4. Customer engagement…
  5. 5. 1 to 1 marketing…
  6. 6. Ethnic/gender/lifestyle marketing…
  7. 7. Viral marketing…
  8. 8. Mass marketing is dead…
  9. 9. The Long Tail…
  10. 10. Ad creation is a delicate art form…
  11. 11. Content is king…</li></li></ul><li>The Golden Age of media metrics…<br />
  12. 12. The Golden Age of media metrics…<br />…is now<br />
  13. 13. The Golden Age of media metrics…<br />…was 40 years ago<br />
  14. 14. The Golden Age of media metrics…<br />…was 40 years ago<br />
  15. 15. Social Commerce Takeaway 1:<br />It is the golden age of data, but we knew 40 years ago exactly how to optimally allocate resources across media channels to maximize ad revenue.<br />
  16. 16. The rise of data mining…<br />
  17. 17. The rise of data mining…<br />…but data will never trump simple theory<br />In genetics, for instance, it&apos;s becoming clear that knowing the entire genome of an organism will still not tell you all of the creature&apos;s physical traits… Knowing someone&apos;s future health, let alone personality or intelligence, based on a genetic readout may be impossible -- in a fundamental, inherent sense, not because we&apos;re stupid but because it is too complex.<br />
  18. 18. The rise of data mining…<br />…but data will never trump simple theory<br />We put forth a model that incorporates the basic concepts of new product diffusion, using a mixture of two distributions: one representing the behavior of innovators (i.e., those who place advance orders) and one representing the behavior of followers (i.e., those who wait for the mass market to emerge).<br />
  19. 19. Social Commerce Takeaway 2:<br />Simple models of behavior outperform complex models out-of-sample over and over again.<br />
  20. 20. Customer engagement…<br />“Engaging your website visitors – not just informing them – is the next critical metric marketers must measure.”<br />“Marketing’s New Key Metric: Engagement”<br />Brian Haven, Forrester, August 2007<br />
  21. 21. Customer engagement…<br />
  22. 22. Customer engagement…<br />
  23. 23. Customer engagement…<br />
  24. 24. Customer engagement…<br />…but many customers are just looking for a “quickie”<br />
  25. 25. Customer engagement…<br />…but many customers are just looking for a “quickie”<br />
  26. 26. Social Commerce Takeaway 3:<br />Be careful the metrics which you optimize against. There is no single metric. There is no single metric that is correct all of the time.<br />
  27. 27. 1 to 1 marketing is the future of B2B and B2C Markets<br />B2B and B2C markets today provide the promise of unlimited targetability<br />Wired (2009)<br />
  28. 28. but customers are too “antsy” (unpredictable) for it to succeed<br />Many companies have lost fortunes by building<br />large data warehouses that have never<br />materialized into profits.<br /> Forrester (2009)<br />
  29. 29. Social Commerce Takeaway 4:<br />Money is made by grouping similar customers based on behavior as scale is obtained.<br />
  30. 30. Ethnic/gender/lifestyle marketing…<br />
  31. 31. Ethnic/gender/lifestyle marketing…<br />DVD purchasing by country of origin<br />Non-Hispanic<br />Hispanic<br />Mean<br />Total Spent ($)<br />Source: comScore panel data -- households with 1+ DVD purchase in 2006<br />
  32. 32. Ethnic/gender/lifestyle marketing…<br />DVD purchasing by country of origin<br />Non-Hispanic<br />Hispanic<br />Total Spent ($)<br />
  33. 33. Ethnic/gender/lifestyle marketing…<br />…the cross-group differences are often “mean”ingless<br />DVD purchasing by country of origin<br />Non-Hispanic<br />Hispanic<br />Total Spent ($)<br />
  34. 34. Social Commerce Takeaway 5:<br />No one is at the mean, all the action is in the variability of the group. Don’t chase (mean)ingless differences.<br />
  35. 35. Viral Marketing…<br />
  36. 36. Viral Marketing…<br />
  37. 37. Viral Marketing…<br />So how are sales? They started out strong, when Aqua Hoops appeared on the &quot;most recent&quot; page in iTunes, and when the game got some buzz from iPhone blogs and G4TV, a cable network for tech/gamer-types... That day, Mablekos sold 350 copies of Aqua Hoops -- $245 net revenue after Apple&apos;s 30% cut. If he could do that for a year, he&apos;d take home $89,000.<br />But after hitting no. 91 on Apple&apos;s &quot;top paid apps&quot; board, Aqua Hoops is down to a more modest sales rate: about 60 sales a day, or $42 daily net revenue -- $15,000 a year. All told, he&apos;s made about $1,400 so far. &quot;Can&apos;t quit job at pizza place yet,&quot; Mablekos joked...<br />
  38. 38. Viral Marketing…<br />…usually it’s barely a sniffle<br />
  39. 39. Social Commerce Takeaway 6:<br />Viral Marketing is locally effective, but globally small. Great for B2B with concentrated markets, less so for B2C.<br />
  40. 40. Mass marketing is dead…<br />
  41. 41. Mass marketing is dead…<br />…long live mass marketing!<br />
  42. 42. Social Commerce Takeaway 7:<br />Mass Marketing is far from dead and is equally effective as ever, it is just really hard to do with all the different media channels that are available today.<br />
  43. 43. The Long Tail…<br />
  44. 44. The Long Tail…<br />…it’s all in the head<br />Don’t radically alter blockbuster resource allocation or product portfolio management strategies. A few winners will still go a long way – probably even further than before. <br />
  45. 45. … hits are in highest demand just as they are in the retail market.<br />This isn’t the first time the Long Tail theory has been called into question… a report found that music provider Mblox also followed a “head-heavy” pattern...<br />
  46. 46. Social Commerce Takeaway 8:<br />More media channels are not cannibalizing, heavy users use each channel heavily (ESPN principles). Invest in heavy users!<br />
  47. 47. Ad creation is a delicate art form…<br />“Advertising is the greatest art form of the twentieth century.”<br />Marshall McLuhan (patron saint of Wired)<br />
  48. 48. Ad creation is a delicate art form…<br />…but statistical science is a good place to start<br />
  49. 49. Ad creation is a delicate art form…<br />…but statistical science is a good place to start<br />
  50. 50. Social Commerce Takeaway 9:<br />Predictive modeling is good art!<br />
  51. 51. Content is king…<br />
  52. 52. Content is king…<br />…but distribution is the ace<br />
  53. 53. Content is king…<br />…but distribution is the ace<br />By pulling out of the deal with YouTube, Warner loses access to the Web’s No. 1 video site, which topped 100 million visitors in October. The site has increasingly become one of the Internet’s favorite ad-supported jukeboxes. Of the top 10 YouTube channels, 7 are music related. Warner Bros. Records is the 11th largest channel.<br />If we can’t reach acceptable business terms, we must part ways with successful partners,” Google said…<br />
  54. 54. Social Commerce Takeaway 10:<br />Putting content in front of the right consumers and many consumers is key!<br />
  55. 55. The Paradoxes of Interactive Media<br /><ul><li>The Golden Age of media metrics… was 40 years ago
  56. 56. The rise of data mining…data will never replace theory
  57. 57. Customer engagement… be careful what you wish for
  58. 58. 1 to 1 marketing…is economically difficult
  59. 59. Ethnic/gender/lifestyle marketing… is “mean”-ingless
  60. 60. Viral marketing…is locally effective
  61. 61. Mass marketing is dead…mass marketing is alive
  62. 62. The Long Tail…the head is as strong as ever
  63. 63. Ad creation is a delicate art form…but modeling helps
  64. 64. Content is king…but distribution is a heavy mediator</li></li></ul><li>Wharton Interactive Media Initiative<br />Thank you!<br />www.whartoninteractive.com <br />OfficeArrow, LLC. 2009. <br />

×