, 27 Feb 2015

BIA/Kelsey is out with my new paper on the status of card-linked offers, which is based on detailed discussions with 14 leaders of the card linking ecosystem, including credit card firms, tech vendors, payment processors, publishers and merchants. Most of the respondents are members of The CardLinx Association.

This week, I presented report highlights to The CardLinx Association’s Mobile Summit in San Mateo. Among the findings: universal agreement that card linking is seeing momentum among merchants; that some budgets for card-linked offers have begun to move from experimental to seven-figure spending; and that many key categories are participating, including Quick Service and Fast Casual restaurants, specialty retail and subscription services.

Challenges remain, however. Once seen in simple terms as a successor to the prepaid model pioneered by Groupon and Living Social, there have been some slow-downs in the business. As Coupons.com SVP Bruce Sattley noted at The CardLinx Summit, “There is not as much fervor among retailers as I would have thought a year ago.”

Clearly, the ultimate success of card-linked offers will be linked to better coordination among the various segments of the CLO ecosystem; the development of a constant stream of attractive offers; greater awareness of CLOs; the elimination of structural sales blockages; and the development of industry standards for card-linked transactions.

More information about the report, including purchase information, may be accessed here.




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, 27 Feb 2015

Facebook isn’t often thought of in terms of “commerce,“ a la a retailer like Amazon or financial institution such as American Express, but it makes a strong case for itself as a company that “unlocks” commerce. Speaking at The CardLinx Association’s Mobile conference in San Mateo on Feb. 24, Facebook Head of Payments and Commerce PJ Linarducci joked that his “day job” is “collecting (payments) from two million advertisers a month to help them connect with their audience.” These involve payments in 55 currencies, with 800+ payment methods. One million transactions take place daily.

Is there is a clear link to commerce from Facebook’s base in advertising? Linarducci thinks it is fairly obvious. “Commerce is about information,” he said.

With placement on 95 of the world’s cellphones, and detailed profile and usage information on its users, commerce also extends the company’s broader social mission. “Payments are just a point in social; helping people get what they want,” Linarducci said. He suggested that many marketers might post offers instead of ads, if given the opportunity.

While Facebook does not appear to have moved forward with several tests involving virtual gift cards, prepaid deals and virtual credits, the company is actively exploring all its commerce options. For instance, it is currently highlighting buy buttons attached to ads, and classifieds for groups.

The big picture is to look at Facebook in terms of its access to audiences, its payments infrastructure and as providing world class tools,” said Linarducci. And commerce is happening on the site whether Facebook is directly involved or not. “People hack around the system to make commerce on Facebook — despite us not doing anything to help them,” he said.

Facebook’s PJ Linarducci




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, 27 Feb 2015

Following yesterday’s video post on Deseret Digital Media’s (DDM) stance on separating new media from old, it’s time now to drill down on the “how.” (video below)

As a brief recap, media companies that launch digital products under entirely new divisions can benefit from nimbleness and growth that isn’t saddled with an innovator’s dilemma. As discussed yesterday, this church & state separation happens on many levels, such as sales and product development.

For the latter, Deseret has developed products that natively make sense for mobile, rather than shoving desktop formats on a smaller screen. As we’ve seen, desktop ad formats don’t monetize as well in mobile, which has been the biggest reason I’ve observed for publisher and advertiser reticence with mobile.

So the answer — as we’ve espoused in the past — is to work with entirely new formats that not only make sense for mobile’s unique form factor, but actually utilize it’s unique variables to create higher performing ads. Those performance deltas lead to premiums, thus counteracting the monetization dilemma.

Those formats and strategies can involve things such as location targeting and  calls to action to capture high-intent mobile actions (like calling a business). But as DDM’s Christopher Lee demonstrates in clear economic terms, it’s also about abandoning traditional formats — like display — altogether.

He names lots of examples of what DDM calls “mobile ready” revenue, then zeros in on native advertising such as sponsored articles. This has traditionally been snubbed in news and journalism contexts but makes more sense in the smartphone era, he argues. The 10 minute highlight reel is below.

 




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, 26 Feb 2015

Screen Shot 2015-02-26 at 9.54.05 AM

Like George Costanza, Deseret Digital Media (DDM) likes to separate its worlds. This is a longstanding debate among media companies about whether or not new digital products and divisions (and correspondingly, ad sales teams) should be independent of the legacy business.

Having these new products/divisions under the operational control of the main organization is what often happens, usually for reasons of control or inertia.  But DDM CEO Clark Gilbert believes that this is a fatal mistake. He showed us why during the opening keynote at ILM ’14. (video below).

This furthers Gilbert’s message that has origins in research from his mentor Clayton Christensen. He shows how only 9 percent of companies facing industry disruption managed to grow revenue past the industry peak. Every one of those launched separate divisions to innovate new products (including DDM).

Advantages include allowing new divisions to have their own sandbox and avoid a classic innovator’s dilemma (speaking of Christensen). Digital products won’t hold a chance if they can’t have the independence and autonomous decision making to move at the speed of their pure-play competitors.

Interestingly, the concept of separating worlds transcends operational control. Sales teams selling advertising around digital products should also be separated according to Gilbert. The sales aspects of this debate are central to a BIA/Kelsey white paper that will publish tomorrow.

And the product execution itself — such as native advertising as DDM demonstrates — should likewise be separated in terms of the talent that’s producing it. For example, there should be a  church & state division between journalists at a newspaper, and the writers of paid content marketing pieces.

See the 10-minute highlight reel below. This mostly covers the “why”. As for the “how,” the full session was choc full of examples of how DDM is pulling this off. We’ll be back tomorrow with Part II, covering its tactics around things like mobile monetization and native advertising.

 




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, 24 Feb 2015

We continue to gear up for our National Conference, taking place next month in Dallas. It will be here before we know it. As we put together the program, many themes are emerging.

One theme is the importance of national brand advertisers in the local media picture. The connotation with “local” is always SMB; but national advertisers are driving lots of the ad spending. In fact, national companies make up 36 percent of the $140 billion spent on location targeted advertising in the U.S.

And thought they’re national in scope, many large brands — especially multi-location and franchised businesses — compete for consumers and mindshare at the local level, where conversions actually happen.  This has driven their early adoption of emerging areas like location based mobile advertising.

We discuss a few of these themes in the video below, and preview the location based mobile ad session. We hope this piques your interest and we’ll have more previews to come. Email me for a discount code if that helps your ability to join us in Dallas (mbolandATbiakelsey.com). Hope to see you there.




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