Cloudvertising: Social Media and the Future of Online Advertising


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The online advertising industry and the publishers it works with are undergoing incredible change right now because ad technology hasn't yet caught up with content technology. Social media and cloud computing, however, are poised to completely change the way we target advertising online, and possibly renew two industries that are otherwise struggling.

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  • Not logos in the sky Ad technology hasn’t yet caught up with content technology Not a sales a pitch, but some reasonable projections based on recent (1) observations, (2) conversations, and (3) technological trends.
  • Partly the recession Partly user behavior: the nature of the web is that it gives us on-demand content, so we end up not ot noticing the content we’re not looking for. So even if advertisers were willing to continue spending the way they did a few years ago, both advertisers and publishers would continue to lose out because advertisers would see less and less results, and publishers would be providing a lower quality user-experience to their audience.
  • But more importantly, we distrust it because it runs counter to the experience that draws us online in the first place. I go online to get what I want when I want it, and I never really want advertising. This is even more true with social media, where users are log-on to INTERACT, and the only content they consume is user-generated-content that’s produced by their contacts.
  • CPM is a hang-up from the print and display media days --> Eye Balls. CPC lets advertisers target these ads according to search queries, there’s no guarantee that the ads are actually relevent to the user. CPA is performance-based, meaning that advertisers only pay when the ad actually converts into a sale. But no real targeting.
  • All of these models share a weakness. And that weakness boils down to an assumption. And we’ve all heard the adage about assumptions: their the mother of all fuck-ups, and to assume makes an ASS out of U and ME.
  • The only thing that 3rd party content tells you with any reliability is who the publisher is trying to target. But publishers have a different mandate from advertisers. To keep their audiences, publishers have to keep them happy, and advertising doesn’t always do that. As long as their getting page view, though, they’re happy.
  • The result is that ad spots sell for less than they could because advertisers never know when one is going to be a dud. The only way to get advertisers to buy the space is by offering them a low enough rate that it covers theri uncertainty. Publishers make less money. AND Advertisers get fewer results.
  • Extension of cloud computing Social is a big part of what makes up the cloud. And what it contributes is data -- data ABOUT users, BY the users. And this user-data can be used to target advertisers. So instead of advertisers guessing who they way, the people they want find them.
  • IaaS means that you don’t have to bother with your own hardware, such as servers and rackspace. PaaS and SaaS means that you don’t have to invest in devloping, trouibleshoooting and updating your own proprietary software --> a concept, I think , we’re all becoming very accustom to. In a nutshell, it’s about about web-based services, solutions, and applications.
  • Your infrastructure is outsource - to the cloud. Your data is stored somewhere remotely - in the cloud Your platforms and the applications they run are also hosted elsewhere - in the cloud And all these tech things, along with your staff, are all able to interface and collaborate - in the cloud.
  • Google: search engine, Gmail, etc. MSFT: software downloads (no disks), Hotmail, etc. Amazone: catalogues Yahoo: search engine, email
  • Facebook: social interactions bookmarks StumbleUpon: UGC site directory Twitter: conversations Flickr: photos Blogs: thoughts, opinions, ideas
  • When you look at users in the cloud, a term comes to mind: UGC They’re uploading and sharing content continuously, whether it’s vacation slides, bookmarks, or conversations. And all this content can tell us a lot more about a user than any demographic analysis: their actual interests and what happens to be on their mind. UGC >> UGD And that data is much more personalize than anything else.
  • So where cloud computing was IaaS, PaaS, and SaaS, cloudvertising is about Dmaas and Htaas Using a software and platform to mine & index all the UGD And using that data to target users with ads that will actually appeal to them, and then convert. Rather than leaving advertisers to target users that appeal to those advertisers.
  • Identity
  • First, it would be able to manage different ad models and campaigs all at once. But it would also support how publishing software is integrated with popular SM funcitons (Tweet this, Digg this, etc.) Because it would support these APIs, it could identify users through their IP address and if they happen to be logged in to any social networks. So once it knows what social network accounts are yours: it could refer back to all your social networking content of yours that it indexed (wall posts, tweets, etc.) , determine your interests, profile you, cross tabulate that against the kinds of ads that you’ve interacted with in the past, and show you ads that you might be (1) interested in, and (2) likely to act on. For example, if there aren’t any CPM ads in the system that might appeal to you, it could load a CPC or CPA ad instead. Advertisers win b/c even if you don’t click, they’re branding is still more likely to be displayed to someone who might care about their products. And publishers win because they can charge more for their ad space by offering more targeted traffic.
  • Microsoft: CPM, CPC, & CPA Quantcast: Google: Gmail Federated Media:
  • Cloudvertising: Social Media and the Future of Online Advertising

    1. 1. Cloudvertising Social Media & the Future of Online Advertising
    2. 2. Online Adscape <ul><li>Falling CPMs </li></ul><ul><li>Banner Blindness </li></ul><ul><li>Lower Click-Through-Rates (CTR) </li></ul>
    3. 3. Context Unlike the television viewer, the Internet user has been conditioned to distrust online advertising from the beginning, due to its association with viruses and overall desktop dysfunction. -- Douglas Haddow,
    4. 4. Ad Targeting Safe Bet Content (products) CPA Getting There Content (keywords) CPC MSM Content (vertical) CPM FORMAT METHOD MODEL
    5. 5. Assumption: 3rd party content can be used to target an audience.
    6. 6. Fallacy: 3rd party content doesn’t say anything about the audience, it only tells you about the publisher.
    7. 7. Adage: 50% of advertising doesn’t work, but we never know which 50%.
    8. 8. Cloudvertising <ul><li>Cloud Computing </li></ul><ul><li>Social Media </li></ul><ul><li>Data Mining in the Cloud </li></ul><ul><li>Users to Target Advertisers </li></ul>
    9. 9. Cloud Computing <ul><li>Hosted solutions that combine: </li></ul><ul><li>s </li></ul><ul><li>Infrastructure-as-a-Service (IaaS) </li></ul><ul><li>Platform-as-a-Service (PaaS) </li></ul><ul><li>Software-as-a-Service (SaaS). </li></ul><ul><li>Web-Based Services </li></ul>
    10. 10. Blueprint: The Cloud
    11. 11. Commerce in the Cloud
    12. 12. Users in the Cloud
    13. 13. UGC  UGD User Generated Content is User Generated Data
    14. 14. Cloudvertising <ul><li>Hosted solutions that combine: </li></ul><ul><li>s </li></ul><ul><li>Data-Minding as-a-Service (DMaaS) </li></ul><ul><li>Hyper-Targeting-as-a-Service (HTaaS) </li></ul>
    15. 15. Hyper-Targeting <ul><li>Targeting users through their: </li></ul><ul><li>Interests </li></ul><ul><li>Network </li></ul><ul><li>Location (mobile) </li></ul><ul><li>& maybe even Mood </li></ul>
    16. 16. Cloudvertising Platform <ul><li>Support CPM, CPC, and CPA Models. </li></ul><ul><li>Support 3rd Party Social Media APIs. </li></ul><ul><li>IP & 3rd Party Cookies to ID Users. </li></ul><ul><li>Index User Cloud Activity. </li></ul><ul><li>Mine User Data. </li></ul><ul><li>Cross Tabulate Performance. </li></ul><ul><li>Hyper-target Ads / Offers Accordingly. </li></ul>
    17. 17. Cloud Publishing <ul><li>Support User Profiles. </li></ul><ul><li>Third Party APIs: Access to Data. </li></ul><ul><li>Mine Data to ID User. </li></ul><ul><li>Index User Cloud Activity. </li></ul><ul><li>Diversify Ad Offering (CPM, CPC, CPA) </li></ul><ul><li>Hyper-target Offers. </li></ul>
    18. 18. Who’s Doing It <ul><li>Microsoft </li></ul><ul><li>Google </li></ul><ul><li>Quantcast </li></ul><ul><li>Federated Media </li></ul>
    19. 19. Pros & Cons <ul><li>Advertisers get better conversions. </li></ul><ul><li>Publishers monetize more effectively. </li></ul><ul><li>Users see more relevant ads. </li></ul><ul><li>Privacy </li></ul><ul><li>Privacy </li></ul><ul><li>Privacy </li></ul><ul><li>Privacy </li></ul>
    20. 20. Questions? <ul><li>CT Moore </li></ul><ul><li> </li></ul><ul><li>[email_address] </li></ul><ul><li>@gypsybandito </li></ul>