Adapt or Die: Lessons learned at EMI

EMI died today.  The Company that started in 1895 and brought recorded music to the masses couldn't adapt to the digital era.  When then CEO Ken Barry hired me to shepherd the label into the 21st century, I told him I'm not a music guy.  Ken said, "We have 11,000 music guys, what we don't have is a future."
Under his leadership, we fought the good fight and tried every new business model we could think of: digital downloads, streaming, subscription, digital juke boxes, digital sheet music, digital background music, pre-loaded hardware, custom manufactured CDs, live concert recordings, webcasts, ringtones, OTA, etc.  Some new ideas slowed the bleeding, but in the end the red ink flowed because physical dollars were replaced with digital dimes.

While Sony and Universal will make money on the vast publishing and recorded music catalogs, the lack of one more outlet for new artists reduces the number of artists who will be able to make a living from their art.  In the end, music couldn't compete with technology for disposable income.  Video games, tablets, and cell phones are the must have form of entertainment.  Interestingly, people consume more hours of music today than any other time in history.  They just don't pay for it.

 I love 20th century music:  The Beatles, Frank Sinatra, Pink Floyd, and Queen.... but I always thought there would be a new future for artists beyond TV contests and children.  Long live rock and roll.

Rants from the corner office: How to implement a zero-waste ad strategy

Rants from the corner office: How to implement a zero-waste ad strategy: The contracting global economy is wreaking havoc with business-as-usual ideas about advertising. Brands are slashing 2012 budgets, and as f...

How to implement a zero-waste ad strategy

The contracting global economy is wreaking havoc with business-as-usual ideas about advertising. Brands are slashing 2012 budgets, and as far as I'm concerned, this is a good thing. With another recession brewing, the ad business needs a good, strong cup of coffee. We now have the wake-up call we've needed: The industry must let go of the cost-per-impression model. The money that's left in those slashed ad budgets needs to get spent on advertising with real and accountable results. When markets go south, CFOs are in charge, and they want to see efficient ROI -- in other words, more results with less spend.

Efficiency, however, is not what brands and companies are getting in a cost-per-impression environment. Impressions are not accountability, nor do they provide measurements of gains in sales, market share, or profits.

Marketers have the ability to reach audiences the size of the Super Bowl everyday online, yet impressions, which are nothing more than the measure of the opportunity to click on an ad, still prevail. Banner blindness is an accepted truth in online advertising: Even on the off-chance that a banner ad is noticed, it's probably because it's distracting and annoying enough to momentarily divert attention. People go online for a reason, and ads that intrude on their primary pursuit --reading an article, playing a game, or checking their social news feed -- are hardly going to compel them to stop what they're doing and happily pay attention.

The answer for marketers is investment in "zero-waste advertising" -- that is, solutions that deliver a consumer's active attention and eliminate paying for wasted, ethereal impressions.

With zero-waste advertising, advertisers only pay when someone has willingly initiated a brand experience -- also known across the industry as cost-per-engagement. To implement zero-waste advertising, measure and exchange value on a 1-1 ratio to assure that the brand, the consumer, and the publisher are all accounted for in the advertising experience. Demand a measured return based on real engagement with real people. Engage the exact audience you want to reach, based on the criteria your brand needs to succeed.

Marketers should take a cue from leading brands that are finding new ways to power cost-effective digital campaigns in social environments -- especially those that are contributing to the expected 14 percent rise in digital spending for 2012 (despite a decrease of 3-6 percent in overall ad spend).

For example, the measurable success that Bing, Best Buy, and Intuit have achieved with zero-waste, value exchange-based advertising across social media has allowed them to pioneer new ways to interact with consumers, and in turn, expand their marketing budgets. Social media's greatest appeal is its ability to convert customers into advocates and generate millions of dollars in earned media. This is a zero-waste approach -- with a multiplier that even television can't deliver.

The feature film industry has also embraced these ideas for non-traditional yet highly efficient marketing -- a smart move, since the industry needs to pay for skyrocketing production budgets.

According to a recent KN Dimestore study that included one of the major studios, 32 percent of people who completed a value-exchange engagement with social media gaming giant Zynga went on to buy movie tickets -- and in most cases, more than one. That translates to a 64 percent conversion from engagement with the movie trailer to ticket purchase. Zero-waste, case in point.

While Wall Street's roller coaster ride is shaking C-level thinking, brand evangelists need to seize the moment, rise out of the digital budget ghetto, and prove that the era of zero-waste marketing has arrived. In advertising, playing it safe during a weak economy can be the most dangerous thing to do.

’Tis the Season to be Social

Six tips to drive Black Friday traffic

Back when print had more impact, big-box retailers like Walmart and Target maximized foot traffic on Black Friday by flooding Thanksgiving Day newspapers with door-buster deals. But with the rapid decline in newspaper circulation, and the proliferation of Americans using Facebook and Twitter, retailers need to add social media marketing to their retail strategy. Now that the holidays are right around the corner, here are six social media tips to guarantee that, like the song says, “it’s the most wonderful time of the year” – at least from a revenue-generating point of view.

1. Build your Facebook fan base now

According to Pew Research, more than half of all U.S. adults use social media. In 2011, Facebook jumped to the No. 1 spot online of time spent online, with over 1 trillion page views a month. As in real estate, the three keys for success in retail are location, location, location – so go where your customers are.

There are many successful techniques for building “likes” on your Facebook page, ranging from viral postings to paid engagement ads, but no matter which strategy you employ, it takes time to build an engaged and active community. Start now so that you’ll have a sizeable audience come the holidays. To give it a holiday spin, allow me to sing this piece of advice, with apologies to Nat King Cole: “So I'm offering this simple phrase, to reach kids from one to 92, although it’s been said many times, many ways, have Facebook users connect to you.”

2. Tweet your door-buster deals

To reference “The Christmas Song” again: Everyone knows a turkey and some mistletoe help to make the season bright – but really, it’s deep discounts that drive shoppers to camp outside your doors overnight. In holiday seasons past, you’ve no doubt worked hard with suppliers to offer the best door-buster promotions ever, only to have your plans leaked early because of newspaper printing deadlines (Target and Kohl’s have even gone to court over these leaks). Why not use Twitter to get out the word yourself, and encourage your best customers to spread the message? As with Facebook, build your Twitter following now, so that you have an audience before Jack Frost comes nipping at your toes.

3. There’s nothing more social than gifting 

Whether it’s two turtle doves or five golden rings, the social act of gift-giving is at the heart of the holidays, so you should translate this idea into the online world. Make wish lists social so that they can be posted and shared within social environments. Macy’s did a very simple but effective campaign last year by asking consumers, “What is at the top of your wish list this holiday season?” and provided the opportunity to use Facebook Connect to share wish lists. The result: 65% of consumers who engaged with the campaign made a list and then shared it with their friends.

4. Don’t miss out on the early season social media advertising upfronts 

In the movie in “Jingle All the Way,” Arnold Schwarzenegger and Sinbad had to overpay and fight for the last toy on the shelf. The same thing will happen to retailers who fail to plan ahead: with all the growth in social media, you can expect scarcity when it comes to highly engaging advertising inventory. Interactive social media ads – such as engagements on social games such as Zynga’s Farmville or Cityville – aren’t as plentiful as display and banner ads. Major retailers such as Best Buy and toymakers like VTech have already secured their placements with social media upfronts for the holidays. To make cash registers jingle, plan ahead.

5. Check out (and reward) those that check in

Even when the weather outside is frightful, your best customers continue to check-in and be delightful – when it’s stormy outside, everyone’s inside and browsing online. You should value and reward your loyal social media followers. Special discounts, free wrapping and pre-sale hours are all easy and effective ways to reward customers who’ve been using Foursquare and Gowalla all year long to publically display their affection for your business.

6. Capture hearts through cause marketing

An activity not just limited to the holiday season, more than 30 million Americans per month use social media to donate time and money to charities. In fact, the number one non-gaming app on Facebook is Causes, and it offers many ways for brands to engage with their audience while empowering 11,000 non-profits to make the world a better place. If your cause marketing programs are sitting by the wayside while you focus on product advertising, build a social media presence for your charity campaigns and let everyone get into the holiday spirit.

Rants from the corner office: SocialVibe's Voluntary Ads Aim To Make The Interne...

Rants from the corner office: SocialVibe's Voluntary Ads Aim To Make The Interne...: Guest posting by Fast Company's Greg Ferenstein: SocialVibe has ambitious plans to make much of the Internet completely free, from FarmV...

SocialVibe's Voluntary Ads Aim To Make The Internet Free

Guest posting by Fast Company's Greg Ferenstein:

SocialVibe has ambitious plans to make much of the Internet completely free, from FarmVille credits and Internet Wi-Fi, to unlimited Pandora streaming. Their method is to offer users an otherwise paid service in exchange for lengthy, interactive advertisements. Consumers appreciate the brand for saving them cash, the brands finally get enough attention to display informative and creative ads, and service providers rake in more users for premium services.

Thanks to extraordinarily high engagement rates, with the average users spending 63 seconds on an ad and 10-40% sharing it with their social network friends, SocialVibe has lassoed high-profile clients, from global brands and A-list celebrities, to presidential campaigns. "I love SocialVibe," says Pepsi's head of Digital Marketing, Shiv Sighn.

Ads and Results

"On the Internet, people have been really effective at completely ignoring banners," says SocialVibe CEO and former President of EMI Jay Samit (who, incidentally, personally negotiated iTunes' original music deal with Steve Jobs). Even gatekeeping strategies, like Hulu's video ads, are easily maneuvered by savvy multi-taskers. "Here's the flaw with Hulu," he argues, "There's no proof you were there moment-by-moment."

He continues, "you push the button, you go make yourself a mocha frappuccino, and then you come back, and then you get to watch your show."

SocialVibe's trick is to appear at the moment when users would otherwise be asked to shell out cash: A Zynga character needs energy, Pandora's free listening quota has been reached, or a user needs to connect at an airport.

SocialVibe ads exploit the pleasant surprise of a third option to wedge in a longer, more interactive ad. As an example, for Disney's Cars, users were offered virtual currency inside Zynga's popular CityVille game, for completing an ad that asked them to select a favorite character, displayed a tailored video, and then asked them to share their experience with friends over Twitter and Facebook.

Results from KN Dimestore's third-party return-on-investment evaluation of the Carsengagement are impressive: 7% more users who had played the engagement said that they had seen the movie in a follow-up survey two weeks later (32% of exposed users vs. 25% unexposed). SocialVibe's engagement was even influential enough to push 3% more users into theaters who had previously said that they had no intention of seeing the movie. Given that few people see a family film alone, and that many of the users shared their enthusiasm with Facebook friends, the actually return on investment is likely higher than 7%, which is why advertisers are willing to spend enough money per ad to make premium services free.

The impression-hungry 2012 political campaigns have already gotten wind of SocialVibe's success and have begun experimenting in key battleground states. On average, users spend over a minute with each political ad, a whopping 85% complete the entire engagement, and 65% click through to the candidate's website or issue page.

A Model for the Post-Scarcity Economy

"Many websites, many of the small content sites are absolutely dying because their business plan was based on a [cost per impression] rate that was unsustainable in a world of unlimited capacity," says Samit.

Advertising in the previous century, he contends, was based on a world of few television channels and limited magazine pages; the flood of Internet content washed away the scarcity model propping up high advertising rates, threatening the financial viability of many media industries, from news outlets to television (like Hulu). SocialVibe's innovation is to leverage an abundance of information to create hyper-targeted ads, encourage sharing with social good and personalized content, and give freedom to consumers.

For starters, SocialVibe ads only appear when users are naturally interrupted by the service itself. "We're not interrupting your day," says Samit. "You're at a point where you can either take out your credit card or you can stop listening to music; we give you a third option."

As a result, SocialVibe makes brands look like heroes, swooping down in the nick of time to save users from spending their hard-earned money. "They think beyond the world of disruptive advertising," says Singh, whereby the consumer can "appreciate the role that we're playing." In other words, Pepsi gets kudos for giving users free services.

The alternative has been, thus far, to come up with flashy, attention-seeking ads that come between the user and their information. "Let's pretend for a second that [flashy ads] did get them to click so you could get paid, does that really ingratiate you to the brand, by annoying your customer?" Samit asks, in an exasperated rant.

While users may be reluctant to spam their network with advertisements, SocialVibe's engagements typically include two elements that are more socially acceptable to share over Facebook and Twitter: individual expression and social good.

Many ads provide elementary ways to remix videos, interact with characters, or promote a cause. For the Kea Soul (pictured below), users splice their own music video together from a simple video editing engagement, and are encouraged to share their critter-filled creation with friends (play with the ad here).

Like expression, sharing philanthropic causes with friends is more socially acceptable; SocialVibe ads often gives users the option of giving to charity, as opposed to, say, buying more virtual seeds for FarmVille.

Indeed, originally, SocialVibe was exclusively a charitable marketing brand, but found that a for-profit model could dramatically increase their user base, and, ultimately, the slice of users giving to charity (like other brands we've profiled). The charitable bent has been a nice boost for Pepsi, whose Refresh campaign has bet big on social good advertising (try Pepsi's engagement here, or check out the fully gallery of social good ads here).

More than just cheap services

Samit, who has been at the helm of many digital watersheds, from negotiating with Steve Jobs over iTunes, to having the original leader in college social networks, animalhouse.com, is optimistic that user attention will be a valuable enough currency to pay for more than just entertainment. "Your mortgage is digital, your health insurance is digital, your credit card bill is digital," he predicts, and "all of these things can be whittled down with a virtual currency and a value exchange."

Rants from the corner office: The Quest for the Living Room: Are Marketers Tilti...

Rants from the corner office: The Quest for the Living Room: Are Marketers Tilti...: When Steve Jobs passed away this month, he left one major technological goal unfilled: the quest to own the living room, and more notably, t...