The idea that the digital advertising market is like public relations advertising, or direct marketing is flawed. The digital market is just a different tool for technologies that have been around for a long time. Some people believe that the digital market is a large enough field to be considered its own market but that should not be the case. The digital field is just another advertising venue like television, radio and printed materials.

Many of the strategies used for digital marketing are not “new” strategies, but rather reformulated ideas from older marketing methods. Social marketing falls under the category of public relations marketing. Making brand-driven websites is more of a brand agency advertising method. Promoting online sales is part of the direct marketing field. These are just examples of ways that digital marketing is only borrowing and modifying advertising traditions that have existed for hundreds of years. Digital advertising is not new; it just has a new coat.

The digital advertising market is very popular right now. Most advertising agencies are advising clients to put a large portion of their advertising budget into online advertising. But to counsel someone to put all of their advertising into digital advertising would be doing them a disservice. While the digital world is an important piece to the marketing world, it is not the whole pie.

Some completely online retailers also conduct offline advertising. This just makes sense. EBay grew much more popular when they started their television campaigns. The shoe store Zappos advertised on billboard style advertisements, and also was mentioned numerous times in different television shows.

One of the main allures of digital marketing is the price. The cost of online marketing is very low, which means that more advertising can be purchased for the same amount of money that would buy a lot less space in another medium. However, the difference between advertising and producing a sale can be quite large when digital advertising is used.

The digital field is very large. One of the reasons it’s so popular right now is because of the downsizing economy. People who once would have seen other advertising mediums such as cable television and magazines may be eliminating that extra expense from their lives. This means that more people will be online more often and have a greater chance of seeing the online advertisements. However, just as many people may be eliminating their Internet, so there is no one place that advertising can occur and produce the same results as a company that advertises in many different places.

Digital marketing is a niche market. This means that it comes under the direct marketing field. The same rules that apply to other direct marketing fields should also apply to the digital market.

The digital market is a great advertising resource. However, if they do not start opening up to other forms of advertising and marketing their popular reign in the marketing world will be very limited.

The phenomenal growth in online advertising has attracted advertising dollars like never before. Millions of dollars are being spent for online ads in a great experiment to determine which strategies and tactics are going to be the most effective. Ad agencies are implementing new direct response strategies designed to increase responses from consumers in more predictable and cost-effective ways. Direct response is still the best form of advertising and is being used in new and improved ways. In today’s economy, every advantage helps.

Ad agencies should be focusing their efforts beyond the limitations of brand advertising to the new direct response strategies. Internet advertising dollars utilizing the Internet technology’s ability to track searches and immediately present ads related to the searched content are more effective than ever. A similar offline advertising strategy is found in the grocery line when certain items keyed in by the cashier produce related item coupons on the sales receipt. A customized presentation of advertising in the new direct response strategy is perhaps the best way to invest advertising dollars in today’s lean market. Targeting the right consumer with the right data at the right time will produce sales.

Contracted ad agencies are on the hook to provide ever more effective strategies to elicit the desired response from consumers. Today’s buyers are increasingly researching the web before purchasing anything from cars to cell phones. The goal of new direct response advertising is to get the consumer to react and buy. The well-placed ad is placed to capture the attention of those already motivated to buy, whether that response is to make the purchase right now or to call for more information.

Brand advertising is how ad agencies have historically approached the consumer. The approach typically seeks to shotgun the message to as many consumers as possible in order to create brand familiarity or brand loyalty. The goal is to make the brand synonymous with the itself in the minds of consumers, such as when a “Coke” represents any number of brands of soft drinks at the fast food restaurant checkout line.
Ad agencies historically have been given the task of incorporating logos, facts, persuasive arguments, testimonials, and images to accomplish the task. And it’s still an effective way to advertise. But it’s time to move beyond brand advertising to the new direct response strategy.

New direct response advertising is characterized by the specific targeting of interested buyers, especially on the web. The Internet is the new frontier in advertising. The possibilities are virtually undiscovered, nearly limitless, and ever changing. Creative advertising strategies can capitalize on a market that so far has not developed a significant sales resistance and that is willing to spend money for products advertised online. Web technology can attach advertisements to keywords used in a search and immediately present opportunities to explore related websites before the consumer has a chance to click on the list resulting from the search.

Understanding the motivations consumer in today’s economy have is important. Getting the best deal possible has always been high on the frugal shopper’s list of priorities. Consumers in an economic downturn are looking for overall value for their dollar. Online advertising is ideally suited to bringing the advertising and the consumer together.

The new direct advertising markets are as varied as the web itself. Consumers are visiting websites, blogs, information portals, and a host of other Internet-related sites in record numbers, and all of them are potentially bonanzas for direct response advertising. Even in today’s economy, only the sky’s the limit.

Why use Reverse Auctions?

Online reverse auctions are a great source for competitively priced supplies. More and more companies are turning to online reverse auctions to acquire goods and services they need to run their business. They allow a company of any size, from small businesses to huge multinational conglomerates, to procure necessary materials and contracts at the lowest prices available. By obtaining the best possible pricing for the products and labor used in generating their products, companies can lower their operating costs and possibly the price of their merchandise giving them a competitive edge in the market today.

How do Reverse Auctions work?

The majority of people are familiar with the standard, or Dutch, auction that has become so popular online through sites like Ebay. These auctions start with a product or service being offered to any and all interested parties at a low starting bid. Then in an attempt to procure the product or action offered the involved parties or companies endeavor to outbid the previous bidder. Outbidding in traditional auctions means agreeing to pay a higher price than the other prospective purchasers. This results in the highest bidder winning the auction. Most of these auctions are not “silent” meaning the bidders are privy to the value the last bidder offered.

In reverse auctions, a company or person states what service or good they wish to purchase and the maximum price they are willing to pay. Then those who can provide the requested item bid on it. Bidders in this type of auction are competing against others in the same industry to be hired on. They outbid each other by offering the service or product either at a lower price than the person or company before them or by offering more of the product for the same price. As with standard auctions, bidders can view what others engaged in the auction have already bid. This is what drives the offering price down or amount offered up, further insuring the most competitive rate for the client seeking the service. However, in contrast to the Dutch auction, reverse auctions are won by the lowest bidder or the entity that offers the most quantity or quality at the lowest price. Another feature present in reverse auctions that is so advantageous to receiving the best bid possible is a moderator. The moderator adds comments to keep the momentum brisk since many of these auctions have a small window for bidding, often just minutes. All these factors contribute to what has made reverse auctions so appealing to companies both large and small.

Where are reverse auctions held?

Most commerce today is done online as it is so time and money efficient and with the right advertising and networking reaches the largest amount of potential customers. So naturally reverse auctions have found a wide audience on the internet. The best source of online reverse auctions for media is Enversa Media Marketplace.

Enversa complements, rather than replaces, the current media-buying process. Enversa, a Web-based media bidding tool, is used for print, online, outdoor, TV and radio media buys. Used during the negotiation phase of the media-buying process, Enversa delivers significantly more inventory than the current market rate.

Contact Marc Pickren for further details as to how the program works.

The buying and selling of media is a $429 billion dollar business. Ad prices in television, radio, print and new media streams are rising, with no guarantee of a positive return. So, companies like Enversa now offer a Web-based tool to broker satisfactory deals between advertisers and media outlets. Thinking backwards can help you and your media buyers move forward.

With their lure of naming a price for a rare or valuable item, auctions usually enjoy a romantic reputation. Much of that aura comes from images of wealthy buyers engaging in a high stakes financial endeavor, where the prize always goes to the highest bidder. By encouraging competition, buyers and sellers, who engage in the reverse auction process, have a new tool to more adequately influence the market rate for all types of products.

It’s not a scenario that is limited to individuals looking to buy anything from a piece of jewelry, art or even a vintage car. Businesses also engage in the practice of bidding for goods and services. Except, the goal isn’t to drive the price up, it’s to force it to go as low as possible. A popular trend in today’s business-to-business dealings is the “reverse auction.

Looking to secure lucrative contracts, suppliers and distributors will underbid each other in real time, online auctions to see who can offer the most rock-bottom price.

Some of the business world’s most recognizable names are using reverse auctions to maintain a healthy bottom line. Home Depot, Sun Microsystems and 3M have all taken advantage of the benefits of reverse auctions. In fact, according to a study by the National Association of Wholesaler-Distributors, nearly 50-percent of the large buyers, who have used reverse auctions, enjoyed an average cost savings of 15-percent.

Adam Fein of Pembroke Consulting in Philadelphia authored the study. He said, “Buyers have been adopting this quickly.” In the airline industry, where a 15-percent reduction in costs can be the difference between survival and bankruptcy, Southwest Airlines used reverse auctions for small items like luggage tags to larger needs like electrical power. And the success has the company looking to expand the practice.

“We’re continuing to look for opportunities to use reverse auctions,” said Ray Sears, vice president of purchasing for Southwest. “They’re a good tool.”

However, reverse auctions aren’t all pie in the sky. While they do allow smaller companies to compete with larger suppliers in the bidding for contracts, getting too aggressive in the price-plunging process can be costly.

“A person can lower their fees, expenses and prices so much that it [becomes] a bad business decision,” says Nuri Otus, 42, a California entrepreneur

“Many small companies focus on their average costs,” Fein says. “That’s a dangerous strategy for pricing on the margins of these contracts where the profitability gets slim.”

Reverse auctions have also breathed life into other industries, where the targets are less tangible than hard goods and measurable services

It shows the willingness of a widening range of companies to expand their traditional, and increasingly ineffective, methods of doing business and embrace a system where all parties involved can emerge winners.

As we mentioned earlier, by encouraging competition and negotiation, buyers and sellers, who engage in the reverse auction process, have a new tool to more adequately influence the market rate for all types of products. While the universality of pitting bidder against bidder to influence a reduction in price is still a work in progress, it would seem that backward thinking is actually becoming forward thinking.

If there was ever a catch-phrase for today’s financial environment it’s “do more with less.” So it comes as no surprise that any plan that will cut a company’s costs and time reflects positively on personnel and budgets.
What better way to accomplish that than with positive benefits for the purchaser in online auctions.

Simply put: Reverse auctions can be positive in that they can act as a “wake-up call” to suppliers. The reverse auction charges the supplier with the responsibility of thrift spending, waste elimination and a sense of supply chain management that actually works for its clients.

In simplest terms, reverse auctions can define the processes of an organization’s procurement system by using web-based applications. Unlike enterprise resource planning systems that enable businesses to automate their internal processes, reverse auctions enable globally dispersed buyers and suppliers to work together to interact and execute transactions directly over the internet.

E-auctions provide significant benefits for those involved: transaction costs can be slashed and bulk discounts can be determined to name just a few. And while most of the research surrounding e-procurement is positive about the savings that can be made, some of the bad press surrounding the topic has arisen because the various approaches taken by companies have not suited their environments.

Within the reverse auction process, an organization can post tenders in real-time online. Suppliers can in turn submit bids in a controlled and internet-secure environment. Likewise, when a company posts a reverse auction, the intention isn’t to sell but rather to purchase — either goods and/or services. The benefits for buyers? Substantial price savings plus a traceable and transparent sourcing process.

In order to guarantee that the reverse auction model will generate the desired results for your organization, it’s crucial that you consider where exactly the reverse auction stands in relation to your overall procurement strategy. And it’s just as important to set a limit on how much you will spend during the auction process.

It’s no secret that the reverse auction model allows for radical savings in price per unit. But at the same time, it’s never a good idea to reverse-auction your entire agenda. Diversification is the key: supplier relationships at times need to be handled with kid gloves as the supplier should be kept in the loop on the progress of reverse-auction activities.

The key factor regarding supplier-selection has a lot to do with how establishes the lowest bid. But certainly it is just as important to base your selection criteria on other factors such as past performance in overall quality, flexibility and support.

Suppliers in turn can ready themselves for reverse auctions by establishing specific “response-strategies” and they can further set themselves apart from their competitors by deciding what their main objectives are within the perimeters of the reverse auction.

The great regarding reverse auction services is that the model can be adapted and used by pretty much any business. Which means the chief benefit: allowing organizations to take advantage of a fast and economical way of establishing a simple, internet-based and web secure auction- environment that allows for real-time pricing and bidding. And don’t forget that reverse auction services allow for global bidding and trading thanks to multiple language- currency-time-zone functions.

Which brings us back to step one: are there positive benefits for the buyer in online auctions? Absolutely!

Online reverse auctions are used more and more frequently in numerous industries and the public sector as a tool for buyers to save costs. In an online reverse auction, a buyer places a request to buy a particular product or service and sellers bid against each other with the lowest price they are willing to offer. The process is automated by software using internet access to bring the buyer and sellers together in an efficient system that saves costs over the traditional three bid paper bidding system. “The success of online reverse auctions is measured by how much purchasers’ and sellers’ costs are reduced, estimated to be about 29 percent.” In another study by Wagner and Schwab, “65 percent of auctions resulted in purchase price savings of 5 percent.” According to Marc Pickren, president of the Enversa Companies, “Our experience is that the values gained using reverse auction bring exceptional ROI.”

Online reverse auctions are used in the advertising industry to buy media (a $429 billion market), providing a competitive advantages for advertisers and agencies, while also offering new sales opportunities for media properties. By using online reverse auctions such as Enversa for print, online, outdoor, TV, and radio media buys, agencies gain increased buying power, a competitive advantage over other agencies, stronger client relationships, time savings, and efficiency. Advertisers gain more media inventory for their budget, access to qualified media properties, a significant return on investment, and faster speed to market. Media properties gain a guaranteed budget, a very short sales cycle, low cost of sales, and new opportunities. In an increasingly competitive industry, online reverse auctions are changing the competitive climate with advantages to both buyers and sellers.

For products, the online reverse auction system works well for supply-chain commodities and low-tech components; those products a buyer needs in which quality and reliability are fairly standard, suppliers are numerous, and price is the primary factor considered in a purchase. Plastic components, fasteners, packaging , office and cleaning supplies are some of the products commonly purchased in online reverse auctions. “FreeMarkets is the largest player in online industrial procurement,” but they use software to handle only the auction itself. Increasingly, companies are automating the entire process online. Auctions can be highly complex, for example combinatorial auctions in which simultaneous auctions are conducted. A supplier submits a set of bidding rules upfront, which are kept hidden from a buyer. For instance, a supplier may choose not to supply if they don’t win enough in a package of products or locations. In most product-bassed auctions, when a seller bids they will specify quality, delivery time and warranty terms, in addition to price. Then the buyer chooses the winner based on best value, not on just best price.

The biggest savings contributing to this 10 percent average reduction of costs is due to savings in paperwork. Automated online software saves both time and money because of a reduction in transaction costs and faster automated transactions.

In addition to the savings in time and money, software solutions can increase the amount of information available to a buyer. For example, software can include sophisticated vendor performance analysis applications with in-depth graphing and reporting functionality to provide information on suppliers’ performance histories. This type of information was never possible with traditional paper bidding processes and gives a buyer improved negotiation capability.

Strategic sourcing is becoming the norm in most industries as companies compete globally. The Internet is breaking down barriers for competition and online reverse auctions are leading the way towards the future, saving an average of 10 percent in costs.

In the War on Bad Economic Times, two sides visibly square off: Cost v Value. Are these two natural enemies? Or, is this merely a symptom of business adjustments and business trends?

Since fiscal budgets are pre-planned, on average, in the last two quarters of a prior fiscal year, out of necessity, businesses must apply financial insight into all possibilities, good or bad. In a bad economy, cost glares out of every budget like a Fourth of July fireworks display. Stretching budget dollars in a tight economy is difficult. In a pronounced bad economy, this task requires financial acrobatics to accomplish.

In most businesses, marketing is the first consideration because it can more easily be manipulated in contrast to operational costs. This is where cost and affordability come into conflict. Without an inherent marketing strategy and proper market planning, sales dip and profits follow suit.

In bad economic times, the challenge is to remain profitable while tightening the financial belt. Thus, marketing strategies must be finely honed so that nothing of significance that would impact profit falls through the cracks. In a bad economy, quality supercedes quantity. This is true of all public relations and advertising budgeting. Often, attacking the problem can be as simple as an overview of prior fiscal years and revisiting marketing and advertising costs that proved most successful and increased profitability. Such success is synonymous with quality.

The 800 lb. gorilla in the room is the inability of affordability to compete successfully with cost. In terms of financial definition, the highest inflation causes the highest deflation when costs are out of the realm of affordability. Most businesses feast at the table of grand denial rather than admit that increasing costs for marketing and advertising means self-improvisation or slicing business costs elsewhere. Definitively, businesses can’t grow if they can’t live within their means.

Continuing to increase prices in a bad economy places all commercial trade in jeopardy of huge loss of profits. Continuing to increase prices in a bad economy flies in the face of realistic budgeting and acceptance of current business economics. The bad economy is a direct result of runaway inflation. The only recouperative action is opposite reaction. If basic marketing and advertising is too costly, staying a course of least resistence is the wisest reaction. This is accomplished by selective planning and purchasing. Spend only on media advertising where the saturation is greatest over a longer term and where public visibility is, at the very least, most concentrated. With proper marketing and advertising strategy, whole portals of less expensive, perhaps even free advertising, is revealed.

Devise new month-to-month strategies based upon current business trends to sustain adequate budgeting. Discard “boom time” marketing and advertising strategies that are incompatible in today’s trade markets. The power of profitable marketing relies heavily on astute professional technique as well as vigilance of business trends before they occur, not after.

The single most important aspect of any business is client retention. When devising marketing and advertising strategies, pay it forward to clients with business longevity.

Marketing for the New Generation.

When author Joseph Jaffe speaks, people listen, and his latest pronouncements citing the beginning of a new media era—the “and” generation—is a positive step in breaking through the traditional direct marketing versus brand advertising argument. This is a new horizon, leaving many of the old guard marketing professionals staring into space with a blank look upon their faces. It is an era during which the lines have become blurred, when it is important to look upon consumers as equals, not someone to beat or dupe. This is the age of communication and flexibility.

As a seasoned marketing executive with experience working at both a brand agency (JWT) and as the president of a direct marketing company (Enversa Companies), I have spent my life arguing the unique advantages of both sides. Recently we began adopting the term “brand response” as a way to talk through the inevitable combination of both forms of advertising. This is in direct alignment with Jaffe’s statement that “and” will be a key component of defining advertising success with your advertising.
Direct marketing has until now consisted of being a means of individual communication when necessary, or a way to complete a transaction. As the new methods of marketing develop and expand with the internet—solidifying its role as a marketing tool—direct mail, stationary advertising, and traditional media spots will evolve into a method of communication with the more relaxed feel of brand-focused communication. Direct advertising has begun to develop a more conversational manner between consumer and corporation. The blurred lines exist in this space, the area in which it is no longer buyer versus mega business, but customer talking to producer as if they are speaking to a neighbor.

Perhaps the one problem direct marketing has always had is the ability to balance long vs. short-term benefit. In the past there was no ongoing communication between consumers and corporations, and what little there was could hardly be considered ‘cozy’. While direct marketing was an efficient way of directing a consumer’s attention to sales, new products, or other, completing a sale was cold and impersonal.

One of Jaffe’s key points was stated in a recent lecture: “new does not replace old and old should not dominate new”. This is the best way to pinpoint the relationship between old and new marketing methods, particularly the way businesses communicate with their customers. Jaffe also attacks the Web 2.0 tendency to overshadow direct marketing with branding as the only thought in marketing aspects. While branding is vital—and he calls anyone who attempts any kind of direct marketing naïve—there has to be an understanding of how the concepts can and must work together.

The idea is that we should no longer attempt to live on one side of the coin. Both methods of marketing have great potential and both have pitfalls. Utilizing what works in one in conjunction with what works in the other leads to successful new age marketing that transcends both the physical and the cyber world.

The “and” economy takes the best part of direct marketing, its accountability, and the ability to measure it accurately, combining that with the communication styles that have flourished in the online communication forums. Since its inception, the internet has continued in an upward thrust to take over all consumer activities. Though the benefits are immense, it has given both consumers and those marketing the goods a way to view each other in a more human light. As scary as the new age may be to the old guard of marketing, nothing but good can come from people relating to each other as equal partners in the purchasing/selling scheme.

As we watch the evolution of marketing and consumer relations develop thanks to the internet, it soon will become obvious that the only real line in existence anymore is the one dividing those stuck in the past from those moving with the flow.

How you handle the tide of change in the end will determine on which side of that line you are.

Discounting the ongoing recount movements in Michigan and Florida, which could throw those states’ delegates back into the mix and Hillary back in the overall lead, the Senator from Illinois has momentum (two straight wins in Wyoming and Mississippi) and a clear delegate lead as we head into Pennsylvania in less than a week.

The past is often a good predictor of the future, and recent (very) historical indicators point to an eventual Obama-McCain title fight, with early odds giving Obama the slightest of edges. Let’s look at a couple of these indicators, one pertaining to the Democratic narrative, and the other to the general election, that let us make such a bold prediction:

Trend One: Obama continues to rake in the cash – lots of it

Sure, Hillary had a strong February, with a $35million fundraising haul. But Obama took it to another level, raising a record $55million during those same 29 days. $45million of that total originated online, including 90 percent coming by way of incremental, individual donations of $100 or less. We think this Internet thing may catch on, after all.

Alright, that’s staggering, folks – an undeniable tide of at least 400,000 supporters across the country last month alone pulled out their pocketbooks for Obama. What’s more interesting and certainly more telling, is that the Obama campaign tells us 75 percent of these web donors were first timers. As campaign energy and enthusiasm go, that’s a check plus in Obama’s column – an ominous sign for Hillary.

Trend Two: John McCain is getting real bang for his bucks

Whoever emerges from the Democratic side will have a clear fundraising advantage over Sen. McCain, if current trends continue. In fact, even before February’s record setting totals from Obama, both he and Hillary had tripled and doubled, respectively, McCain’s donation totals through January.

That aside, there is at least one reason for Republican optimism, even as Democrats continue lapping them in the race for donations and demonstrable momentum. It’s this – McCain’s return on investment for his TV ad spends is considerably better than both of his remaining Democratic rivals. For every delegate acquired, Obama and Hillary are spending $33,000 and $25,000 each, respectively, in television advertising. For his part, McCain’s is a frugal $9200 per delegate.

Small potatoes? Sure.
Forced frugality? Maybe.

But one sliver of hope for Republicans during what’s become a virtual Democrat infomercial during this extended delegate chase. Regardless of any fundraising discrepancies during the general election, they can be assured their standard bearer will spend his cash wisely.

That counts for something, right?

Galluci is on the faculty of xTrain providing training on podcasting and social media, and is a speaker at various industry events including ad:tech, FlashForward, Got Social Media?, Search Engine Watch Live! eMarketing Summit, and macworld.

Good morning, Gio.

Gio: Good morning.

Delia: Do you feel that social media will still be the hot topic of 2008?

Gio: Absolutely! In fact, I think that 2008 is going to be somewhat of a honeymoon for social media the same way that search enjoyed its day in the sunshine a couple of years ago. So, there’s so much stuff that encompasses the phrase or the term, social media. In particular though, I think, we’re looking at a very, very hot year for video. And that just comes from consumer-generated content and how marketers can use it, and technologists can use it as well as social networking platforms like Facebook, Twitter, and Bebo and places like that.

Delia: Do you think that the video will go outside of just the social media realm? I mean will it be used in advertising, or how will it be used extensively?

Gio: Yes, into the great extent that it already is being used, I’m seeing companies that are popping up that are new media companies by themselves. And there are a couple, I mean, if you want to call them ‘grand daddies’, I mean, there’s PodTech network out there in PodShow that have been, you know, their sole function is ‘New Media’ and essentially they’re using advertising to sell the product, but their primary focus is video online.

Delia: OK. Do you see consumers using that video to help sell products as well? Or is it going to just help them make their lives more social and more visible to the people out there?

Gio: Both. I mean, you’re going to see and you see the technology around today when you see things like live streaming when you look it like Justin.tv and nustream, people have the capability with no installation to be able to go to a website, click a button, and have a flash applet open up the existing webcam on their machine. And when you think of websites where people put reviews and comments on say hotels or for progs, things like that, you’re going to see that converted over to video. And you see that again in some cases on the websites now where you can go up and actually put in video responses and YouTube’s got that right now where you can go up and put a video response to a video that’s online.

It’s only going to be a match progression that’s going to move over to consumer, e-commerce websites, travel websites, places like that where reviews are very important right now anyway.

Delia: That’s true. That’s been building a long time too, I mean, I think we’ve been working on that. I remember a company started coming out with that like 10 years, I guess, or something. So, it’s just now building to where it needs to be.

Gio: I think the big key on that is that we’ve found a way to be able to launch those application inside of a browser without an additional installation of any tools.

Delia: Good.

Gio: So, you’re looking at the Macintosh taking over 10% of the market share. Every one of those has a webcam built into it. You would be, you know, I don’t know what the market share is, but most folks do have webcams in some form of fashion. The Sony laptops have webcams built into them and all other desktops too, so the webcam itself is going to become the standard part of pretty much any desktop or laptop out there, and with the ability to be sitting on the website and simply, literally one click away from being able to a video response set about something. It’s going to be a natural progression where people are going to do that because that’s even easier than sitting down, thinking how to write something out and put in your thoughts on paper, as long as you’re not flaming something.

Delia: Right, right, right. Which, actually, goes into our next question: What are the some of the pitfalls that brands need to be aware of when they’re trying to build a social network?

Gio: Don’t have enough time to talk about them all. [Laughter] Um, I can talk about some of the pitfalls I’ve seen, I mean, I think number one that I’ve seen, we’ve been dabbling around in social media for a few years now and been working with clients as contractors or vendors for about a year now. And the biggest issue that I see with social media and vendors is people coming to the table with products or services that just have no place in social media.

I mean, if you’re going to try to sell bathroom floss is, I’m sorry. No one on Facebook is going to be excited about that. And it’s not to discourage the bathroom accessory industry, but there’s a time and a place just like you’re going to pick what drive time advertisers that you’re on AM radio. Those are specific type of advertisers and you’re going to have different advertisers that are going to advertise on, say on Nickelodeon or FoxNews or something like that.

So, the biggest challenge that we’ve seen is, you know, I don’t like to turn business away but it’s hard to sit down with somebody and say, “Look! I can’t sell roofing materials on Facebook for you.” I mean no one on MySpace cares about that. So, it’s going to be setting expectations as it’s going to be number one and knowing your place. It’s not to say that you can’t, if you sell bathroom pictures, find a place in social media. You can easily go and produce preroll or postroll ads, and put those on existing popular do-it-yourself type of videos and things like that. So, maybe it’s not the case where you’re going to be able to get one sell fixtures because it’s the next greatest thing. But you certainly can get it on board with, you know, maybe you can co-sponsor something with a Home Depot do-it-yourself video or something like that.

And there are a few DIY websites, one that stands out is a website called “Five Minutes” where they have do-it-yourself articles on there. We see that transition go into audio and video podcasting, that’s a fantastic way for a company to get in at very low cost compared to traditional media.

So, another one, another issue that I come across is companies going in and setting up an anonymous accounts, setting up fake users and running rampant through the web, pretending like you got these average, anonymous people on the web that are ‘rah-rah’ about the product without building up any kind of foundation for why that user would be up and talking about the products. So, there are definitely marketing companies that do set up anonymous accounts and they use them very effectively, but you’ve got to be transparent.

You’ve got to make sure people know that they’re representatives of the company, and people in social networks will listen to you. But they won’t be tricked and they won’t be lied to, so whenever companies do that kind of stuff and they get found out, the pain is enormous. So, you need to stay away from trying to trick people into looking at your product. If you’ve got a product that has legs, people will pick up on it. Be transparent, tell them who you are and then talk about their product in a way that brings value to them which, kind of, sounds odd but it’s not so much about the products about what the value is that the product brings to the user or the listener or the viewer.

Delia: Right, which is, of course, is a Marketing 101, kind of thing for us that…

Gio: Yes, but you’d be surprised.

Delia: No, I know! I mean, there’s a lot of companies out there that you’re wondering why are they out there and what are they trying to accomplish by being out there, and I remember when the ‘What’s Up’ campaign came in and as a marketer back then, we had so many clients coming to us saying, “I want that next one! I want whatever it is that’s going to be the next hot one. ”

Gio: Exactly!

Delia: Well, you know, there’s got to be a reason. You can’t just come up with it, but to your point, what can a brand do to create something authentic that people will respond to in a social media world that they won’t get flamed.

Gio: This is difficult to say because my impression when I first got into social media was you don’t need humans anymore. This can all be done through computers. You can do this anonymously through the web, you can set up accounts, you can build these huge accounts, but the fact of the matter is that this comes in full circle in the most positive response we’ve got and the best results we’ve gotten out of campaigns, is when we are heavily involved in campaigns from a human perspective.

And what I mean by that is we’ve got a situation where a software company came to us, they’re one of the top 10 software companies in the world, and they had a challenge with getting street cred for their brand. People knew their product but did not necessarily know their brand. And so we launched a campaign for them but the reason why the campaign, and this was a blogging campaign, was successful was because we made sure we picked people out of the company that were already well-known and well-liked within the industry and well-respected. Now, if we had gone and picked out either anonymous people that didn’t have an existing reputation that was positive in the community or created some fictional characters, there’s no way that thing would’ve picked up legs.

To prove the point on the other side, we had a company that was actually starting a social network that is based on health and wellness, and they had very a bad reputation in the industry. And we could not get people to save our lives, to look at their product and to take them seriously because everybody was focused on the bad feelings that they generated within the local community because various reasons, I don’t want to go in details.

But because of that human element that can make or break you, and so what we’ve applied to all of our campaign since then is whenever clients come to us and they want to do something, there has to be a way for us to physically reach out and touch people. So, if it say, if it’s a computer manufacturer and we’re trying to push a new laptop for them, we’ve got to make sure that when somebody reaches out that we can within two hours of getting a notice from a comment on a blog, have a human being contact them back either through their comment, or even, you know, give them a phone number to call, something like that. There has to be a human element involved for the success to be there.

And just like within traditional media, we’re thinking about commercials which was the reason why people go and hire celebrity spokespeople because they have name and face recognition. We find that that’s huge also, that whenever we can get a hold of Internet celebrities that can go and help us, talk to people about a brand, I mean, it’s a lightened day – the difference with the response we get through social media because these people have already established themselves within the community, they’re respected, and we have to make sure that the proper service they’re pushing make sense with what the reputation is that they have in the industry.

But as long as those things are in sync, we find fantastic success with that with going out there and showing product and services to people. We got one situation where we have social media as the number one register ringer for a client that we have, it’s an online trading line. And so we have an amazing success there within.

Delia: Yes, we have too. Actually, we’ve got really high success rates in our social media.

Gio: It makes me feel real. [Laughter] They have to go and improve mine, I mean, it’s funny because a year ago, it’s like you have to walk in orange to show value and just generating raw traffic. You can do that for some clients and they’re happy with that, but they wise up really quickly and they say all the traffic’s were good and all but I need to sell widgets, I need to sell product. And we can’t sell product with this stuff, they could care less if they have a hundred thousand heads on something if no one’s buying. All that adds as soon as they’re running up their ISP bill.

So, it’s good to be here today because we’re figuring out how to make this stuff actually benefit advertisers and marketers.

Delia: I think as, I know when this kind of media first came out, a lot of clients wanted to jump in but there was a lot of risks that they had to be willing to prepare themselves for, I mean, when its social media people have the right and the choice and the chance to say something. So, what kind of mindset your brands need to be and to be successful, and what kind of risks do they need to be willing to take?

Gio: You know, from the risk standpoint, you’re going to have to take the risk that people are going to say what’s on their mind. I, kind of, look at companies in this day and age where there’s someone’s involved in social media or not. They’re a part of the conversation if they’re product is on the marketplace. And that’s one thing that, kind of, tickles me is that companies will come to me and talk about how they want to get involved in social media and all for what, you know Google. And I’ll do a blog search on Google or Technorati and say, “Honey, you’re already there.”

You’re making the decision to participate now. But you’re already out there, and so it’s a situation where, you know, that’s a risk they have to take, but don’t taken it by being out the marketplace. And companies have to be, I don’t know that it’s the risk, I think it’s more being prepared and start acting like almost like political entities.

I think about this as I watch the campaigns that they’re going on right now – the US Presidential campaigns, and it just, kind of, struck me a couple of days ago that companies have to behave like candidates now. I mean the way Apple had to respond to people being furious about that price drop 90 days after they released it.

Without social media in the picture, Apple was famous for funning their nose after the consumers that were the evangelists for their brand. Just bluntly would say, “Hmm, too bad!” And I’m a Mac fan, I mean, we were like laptops, we took it, we put our televisions, our legs and apologized, and OK, but we’re still pleased we still have our Macs. And today, because of the outrage and because it’s spread so quickly, it’s phenomenal how companies now have to be able to turn on a dime like that and respond our risk the wrath of consumers that maybe a very, very small portion of their overall user base, but because they’re so loud they have no choice to respond.

I mean, AT&T that I found deal with Justinas Erich. She puts up this silly, 60 second video, and within seven days she’s all over the major news networks, not over US, but all over the world. It’s really a neat case that you need to watch AT&T’s initial response, and then watch very quietly. Eight days later, they changed the policy. And I have no idea who at AT&T would have the power to make a decision and make an actual change in AT&T within eight days anywhere within that organization. Much less at 23 of web designer from Pittsburgh.

Delia: Right.

Gio: So, the risk is, getting back to your question, I think, the risk is not responding, not participating, and not being aware of the fact that you’re in this whether you like it or not. And if you were going to be able to weather the storm and, not only put up with potentially bad stuff then benefit from the sunshine, the social meeting can shine on you, you better get active. And so the risk is sitting back on the sidelines and be in complacent, and watching everybody else pass by you because I can see companies making or breaking themselves through social media alone, in positive or negative manner.

Delia: Right. It almost sounds like companies need to make sure that social media’s part of their PR strategy as well, you know, bad or good.

Gio: Without a doubt! And that can be! I mean that can be a PR from a positive standpoint or reputation management. You got to be and those are two different disciplines. Getting out there and spreading the love and saying the good stuff about the product, and developing evangelist in the community is one thing. And from our past, I mean, some of you and I both worked with Tony Wright. He managed AT&T PR account during 9/11. One of the things that really sticks with me that he said to me was, “That’s the kind of experience that I hope nobody ever gets.”

Delia: Oh, yes, right.

Gio: You know, having to live through that stuff and for him that was a tragedy but was still a former brand reputation management, and that is, I learned from him through the years, is a completely different discipline than being the shoe leader for a brand or company.

Delia: Right. That’s a good point. Do you feel that green marketing will have to be significant this year or is it just a flash? Is it going to go away?

Gio: You know, I hate to say this because my wife and I are very,I don’ t know, I mean we don’t beat people over the head about it but we’re, kind of, ‘eco sensitive’ I guess, to do the phrase. We recycle like crazy. Our neighbors think we’re nerds because we have twice as many recycling bins as much as they do. But our daughters are getting a great experience with learning how to reduce waste and be more eco-friendly, but I can’t help but think that it’s a fact.

And the reason why is that, it’s like the train is too hot, I mean, it heated up, it came up out of nowhere, and then all of the sudden you’ve got, literally, seemed like out of nowhere Walmart is this greeny eco-friendly company. And you got the car companies out there, there must be five or six top video podcast on nothing but greening up the environment and eco-design and stuff like that. And I would love to see it stick around, but I don’t know. Touch base with me about a year from now, I would be surprised if we were still still so heavily invested in green technologies and design. So that’d be great if it were, but I just don’t think that there’s a whole lot of foundation to what’s going on there.

Delia: Unless something globally happens. I could see that as result of something.

Gio: If you have some kind of disaster, you know, something like that, but…

Delia: Which is a shame.

Gio: Yes, it’s a shame. I think you would have to be more than just, say, like a nuclear meltdown or something like that. I mean it would have to be something that was like, you know, freak everybody out worldwide.

Delia: Right.

Gio: But right now, I guess my take-on is there’s so much marketing glitz and polish on all the messages that just seems really disingenuous to me. And that is why, if you like, you probably didn’t have a lot on this thing. Now there’s obviously people within ecology and the green industry and stuff like that I really believe and we’ll keep pushing forward. And within that, I don’t mean this in a negative way, but within that bubble of an industry, those people are warriors for that cause, they always will be, but when you step out and you see large corporations and all these companies, MSNBC, filming one day with their studio lights off in order to be eco-friendly.

Delia: Right.

Gio: To me, that’s just a slack, I mean, that’s insulting to the people that get out there and do it on a regular basis. And to me, those kinds of actions bring attention to the issue but I don’t remember who it was, but there was somebody who took a full page ad out in the New York Times. It was CNN, I think. CNN had a show about greening or eco-terrorism or something. It was something that had to do with the ecology, and the first thing that struck me and all were all the people that saw that was so you wouldn’t spend all that money and all that paper to advertise the fact that you’re going to talk to us about being more earth friendly.

It would have been smarter to do something smaller, and I wouldn’t gotten as much attention but do something some other way than using paper for heaven’s sakes to advertise this. And so, it’s like the people that are running the big campaigns for this stuff, you can’t help but think that they’re not really deeply invested in the environment, deeply invested in the green industry.

Delia: Right. I can see that. What do you feel is going to be more successful in 2008? Widgets, narrowcasting, mobile marketing, advergaming, or is there something else out there that is not even on the radar?

Gio: Not talk about it a lot, but advergaming is already are gargantuan in industry, and there’s not a whole lot of lights shown on it. It’s funny because I did an ad:tech last year, I had to a deal with the Vista launch, and part of it was the tie in to XBox Live through Vista and the advertising stuff. And it took me forever to find information about it. But it’s a huge industry, much bigger than search right now with the capabilities and pricewise.

So, I would have to say that that just from a revenue generation standpoint, advergaming is going to be, but I don’t think we’re going to see a whole lot of information about it. I think that you’re going to see marketing companies and advertising companies step over the bounds of what’s acceptable in social networking and you’re going to see we’re built there. In the midst steps by, surprisingly, Facebook, it really blows me away but then you’d think through giving beacon, launching beacon without giving proper notification to people. So, other year, you’re going to see, kind of, a grassroots revolt on marketing advertising through social networks.

You already, I mean, marketers and advertisers are already hated in social networks, but I think you’re going to see something on this that’s really going to push the boundaries there. But video, I think you’re going to see the year of video especially with the writers’ strike going on right now. There are some very well known actors right now that are putting together their own production companies because they’re sick of the large production companies, and NBC and CBS-ABC controlling what’s going on and they’re putting together companies with writers to produce their own content for the web.

And I think what you’re going to see is the beginning of the entertainment industry that takes the bull by the horns and says, “OK, corporate fat cats! We’re tired of you! We can do this on our own for next to no cost “. It’s funny because that’s how, I was reading up on something, that’s how United Artists got started. It was actors going and getting tired of the big movie suits, controlling everything, and they got together with a bunch of the set of people, and with the writers and stuff, and created United Artists. And, ironically, United Artist is the first company that signed the deal, a compromised deal with the writers yesterday.

So, I think you’re going to see, in this year, you’re going to see much more than you’ve seen in the past. I think big media is, kind of, hit itself in the chin with the writers’ strike here. And you’re going to see a lot of content coming out on the web, only on the web, and being distributed through online services where it’s not available on TV and they’re going to give a large portion of the attention of the market.

Delia: More FunnyorDie (www.funnyordie.com).

Gio: Yes.

Delia: I mean, classic, red hair

Gio: Yes, absolutely.

Delia: And I remember came out on YouTube first and then right away, as soon as you start getting the hits it took it’s own site. And, I would say David Letterman, he received so much friends from having some production company. Did you watch Stephen Colbert last night?

Gio: Yes.

Delia: It was good, it was good. And so I agree, and I think advergaming definitely is out there. We’re excited about that. So, that’s all we have today. Thank you, Gio.

Gio: Thank you.