SocialMedia Blog

Here are some notes from today’s business school event.

9:30am: ANALYTICS

Analytics is about answering questions for developers. Who are my users? Where is my traffic coming from?

Analytics for social networks is different from regular analytics because there are new metrics that you get out of social media.

Virality is the big new metric.

Great breakdown of impressions converting -> click-throughs, converting -> installs. Need to track the activity of those users.

Break down life cycle using AARRR method. Acquisition, Activation, Retention, Referral, Revenue. Trick is to move as many people through the pipeline as possible.

Charles - suggests moving referral stage earlier in application
Ian - It’s all about “infecting” more users. The k factor.
Charles - Your seed group aren’t as important as sociographics of seed group. Measuring sex of users, does that make a difference. no. Most important trait is number of friends.
Charles - tested two apps with different seed groups and growth was drastically different.
Ian - UGC is essential to grabbing users and engaging
Hiten - Give users a good introduction to your application. Explain what your application does when users first get on. Welcome screen. Guide them toward the first action you want users to take.
Charles - Keep users confident in the next step to take. Speed to first action is a great indicator of user confidence. Tell users what to do and keep them aware of what task they’re doing and what the result will be. Users will click if you tell them to as long as you deliver on promises. Do A B testing. Track results of different viral channels.
Ian - Can measure user engagement on app, but in agreement with TOS.
Charles - Can’t pre-plan your app too much. You can’t necessarily cater toward demographic. By changing your application, you may change the mix that attracted your demo.
Ian - Engagement, impressions, and demographics are what matter.
Hiten - You should design toward a demographic.
Charles - Modifying an earlier point… You have to roll with the punches. A B testing is essential.
Open question to the audience - do you design with demographics in mind. Couple in the audience are designing with demographics in mind.

Referral
Eddie - general rule - higher conversion rate through organic traffic than paid traffic.
Charles - k factor doesn’t need to be that high, just needs to be above 1. Otherwise app is worthless.
Ian - communication and gaming apps are more viral. Bought 10K installs, quickly grew to over 100,000 users in a week. Gaming application didn’t have engaging hooks and didn’t do as well.
Charles - % of people who refer. want to get to 80 - 85% referral users in about a week.

Revenue - balancing revenue and user experience
Hiten - how do you get people to click. analytics helps you find out what is the best place to engage with an ad.
Charles - You can’t just change one part of your application. When you put someone through an ad, does that backfire because they don’t come back. Don’t just look at change in revenue. Look at change in virality.
Ian - have to test. engagement apps start to have higher eCPM. Brands need demographics. Turned application into an ad unit.
Charles - increase traffic by 10% just by adding ads.

Best practices
Hiten - application types define best practices. Look at successful applications.
Charles and Ian -TESTING TESTING TESTING. ask your audience for information.

Q&A
After how many minutes does it take to find out what’s a good app and a bad application?
Charles - 20,000 vs. 5,000 users depending on your apps seed group. You’ll know within minutes whether you have a good group. Know within minutes to hours.
What is the substantial difference that shows A is better than B?
Charles - depends. If you’re tweaking virality, little changes matter.
How do you find different seed group?
Find through getting users from different existing apps.
Can get better conversion by going straight to application and skipping about page.
Hiten - ratings matter and can convert into more invites.
Charles - get users to review after interacting with your app.
How do you measure newsfeed conversion?
We can estimate it, but not test it directly.
What are your price points for NBT testing and A B testing?
We give tools, users bear the cost of using them.
How are clients making decisions based on data?
Hiten - it’s best to have one person responsible for reacting to metrics
Ian - One guy at large app shop (15 people) is dealing with metrics.
Eddie - Each segment has their own metrics.

11:00am: MARKETING

This panel was not blogged because I was moderating it.

Special Presentation from:

Ed Zobrist, President, Sierra Online,
a division of Vivendi Games

Sierra, when it completes their merger with Activision will be the largest gaming company in the world.
They develop games regardless of platform.

What are they doing with social networking?
Commanders Tower defense - launched on X box live arcade
Launching on FB, working with Zynga
Developed by external developer.
Hire D top tower defense developer to consult on development
launching in June.
Has an in game transaction engine.

Traditional cost structure listed in slide.

Soliciting developers - contact social@sierraonline.com - you’ll get a free T-Shirt.

Want to acquire talent, not IP.

12:30pm: LUNCH

Patrick Chanezon - API Evangelist at
Google

“OpenSocial is an Open Standard defining
a set of common APIs that work on many different social websites, including
MySpace, Plaxo, Hi5, Ning, orkut, Salesforce.com and LinkedIn, among
others. This allows developers to learn one API, then write a social
application for any of those sites, reaching over 200M+ users in dozens
of countries: Learn once, write anywhere.”

think about social objects.
Open Social socializes the web without recreating the wheel through APIs.
Creating standards creates new markets.

> 200 million users on OpenSocial
Gartner technology hype cycle - starts out with expectations peaking, then sinks to disillusionment, then rises to productivity.
Social sites are free to implement Open Social as they see fit.
Open Social sites are being cautious with viral channels. Will change over time
Looking to work on bringing social graph to websites and mobile platforms.
Porting between Open Social containers can be as short as 60 minutes.

1:00pm: BRAND ADVERTISING

Huge potential for brands inside of social networks.
Google haven’t been serving brands with advertising, keywords don’t work.

Mike - movie studios love social media. AOL did 55 million with movie releases, myspace around 70 million, etc… Everyone’s trying to figure out social media. We need to help brands understand how to advertise so they don’t miss out on opportunities.
Joe - on board of imedia. Charged with finding out about application. Same thing happened before in advertising. When digital media marketing happened, we were saying the same words. Problem is how do we get message to brands. Lawyers and brand managers get in the way.

Example, harold and kumar, after a day, already 5,000 users engaging with brand.

Liz - background is from entertainment. Started a company to help with word of mouth business. Virality is exciting. It proves the concepts. Brands are trying to find out how to successfully connect through social media. Entertainment want to be at the head of the curve to be sexy and cool

Mike - Social media is where everything interesting is going on. Drillbit taylor bombed, campaign was bad. Movie does well, we’re golden. We have less flexibility with non entertainment companies because entertainment moves faster, has shorter attention span.

Joe - We need apps that we can sell to brands. Can we make apps that help people interact with brands. Analytics and testing is very expensive. Bringing analytics to brands id important.

Liz - Brands aren’t thinking outside of single experiences with the new technologies (i.e. widgets).

Mike - It’s an education process. Brands will buy a cool idea that elevates brand identity, not always DR. Don’t want to hurt brand. Toyota won’t tolerate bad brand exposure.

Liz - Beer advertisers will do edgier ads. They also love the spill over effects of campaigns that they don’t pay for.

Joe - Shot Gwen Stefani. Started a glorious life campaign, people submit their own life videos. Two years ago tried this. Took 2 months to get original video through legal and there wasn’t anything risque.

Q&A
How do people reach audience?
Liz - strategy is really important. Just set expectations.

Brenan - Boost mobile knows the culture of their audience. They can deal with FB by making a fan page and driving traffic to their fan page. They want to bring metrics from off Facebook back to on Facebook. Engagements on apps is extremely exciting. Interaction rates are exciting. Reporting will help them understand the investment.

Mike - we need to standardize the medium. They want to have everything wrapped up and easy to buy.

Developer - Needs more messaging from Brands to find out what they want.

Joe - We don’t know everything. We know the demographic, but we don’t know how to get into social networks effectively. Would love to hear from developers.

Liz - don’t underestimate instincts.

Brenan - How would you design an application so that a brand could own the voice on your application for a period of time.

Developer - I can do that, but are brands going to like the application. Will it be too edgy.

Developer - excited to hear about brands wanting to work with developers and advertise. In a few days I can rebuild out new applications.

Joe - We’re the new new. It’s going to spread to the flyover states over the next couple of years.

Liz - Asking people what budget is there fro what’s not invented.

Joe - June and November, set budgets, thats when you have to go to brands.

Reporter - People are doubting spending on social media.

Joe - we may be in a recession, but where is the money coming out of? GM - $1.5 billion moved online. We’re in a space that is more accountable in a recession.

What are the key metrics that prove success for brands?

Mike - for entertainment - # of trailer views. For AOL, Toyota would take over landing page, then measure change in Toyota search terms.

Brenan - Brands want to know that they beat the average.

Liz - MySpace promoted 300 by letting users have 300 photos. Very successful.

Joe - Aspirational marketing. BMW started it ten years ago with online films. As people grew up, they bought BMWs

Mike - It’s definitely the place to be. We’ll make mistakes, but the market is huge.

2:30pm: PERFORMANCE ADVERTISING

Dennis - CPA offers pay per performance. Some offers, like registering for a credit card may pay $60. Others may pay a dollar for an email. However, the email offer may pay more because more people fill it out. That’s why effective CPM matters.

Doug - Getting international traffic matters. International users aren’t burnt out on offers. American express is willing to pay a lot of money for a qualified lead. U.S traffic only makes up a certain segment of FB’s traffic. The other international traffic needs offers too.

Dennis - Other social networks get a .1 or .15 eCPM. banner ads don’t work. FB has a .04% CTR. Even if clicks are worth a lot, you don’t get above a .1 CPM. When FB worked we just continued to try a variety of different offers. Just tried everything. Over the history of the company, we began focusing on fewer offers that worked. Webfetti worked well, but got burnt out because some applications were incentivising the download. Burnt out the offer and dropped the payout, which dropped the eCPM. We’re going to allow integration with offers in the future. example, users fill out surveys to advance in level.

Question - Are offer integrations hurting application traffic?

Doug - There are apps with virtual economies. Be up front with users about what they have to do. Let them know that they can get money for responding to this offer. Also it differs between how aggressive the offers are. Aggressive offers may turn off users.

Question - Sometimes users think that ad was run by app. When they get burnt by ad, they think that it was the app creator.

Dennis - We’re screening ads for this. I’ve subscribed to these offers in order to find out if users are actually able to unsubscribe.

Question - Liability if people falsify their age?

Dennis - We can’t verify their age. It’s a gray area.

Dennis - We have an incentive to keep lead traffic good so that advertisers keep running and that payouts stay solid.

Question - How do you ensure that the ads don’t hurt the network?

Dennis - We have a mix of automated and manual techniques for scanning these ads.

Question - What are the gray areas for using Facebook’s Data?

Dennis - there’s a lot of gray area. You can’t store direct data from FQL, but it’s up in the air whether you can store derivative calculations from user data.

Matthew - we have to ensure that offers back out well and make sure that consumers and advertisers are happy. Screwing both parties doesn’t keep long term revenues. If publishers are fraudulent, we can tell in a matter of hours if something is fraudulent. We want developers to be happy with what offers are running so that their ad doesn’t look good.

Seth - mobile offers may work better on social networks because it doesn’t require a credit card. A mobile payment platform is coming soon.

Matt - offers that deal with products that people interface with are what we really want. Jiffy lube, restaurants etc.

Dennis - on mobile we’re going to see some better mobile advertising. mobile phones are an easy way to charge. The quality of offers has to improve.

Question - How can developer know how the deals payouts are trending?

Dennis - it’s just like Google adsense. it fluctuates based on the quality of traffic. SocialMedia works to keep those eCPMs high in a competitive market.

Question - If you’re running too much remnant, does it hurt brands running ads?

Dennis - the larger problem is the actual app itself. brands are more concerned about advertising on bad apps, rather than the remnant inventory.

Letting brands take over your app can sell at a premium.

Question - how do you see offers performing across different networks?

Dennis - Country is the bigger impact. Canada, Australia perform better.

Matthew - Eager to see MySpace get going.

4:00-530pm: BUSINESS MODELING

Eddie - Focusing on thought process for business models

revenue per page view X number pages = revenue
ads per page X impressions per ad X revenue per thousand = revenue per page view
Revenue / impressions = RPM = eCPM

Must understand your revenue pwer visitor.
RPPV * CVR install = RPV ex $1.20 * 40% = $.54/visitor
RPV/ROAS = Avg Maz CPC $0.54 / 200% = .27 max CPC

Modeling an app is impossible with no history. You have to make and estimate and then roll with the punches. Each app can have its own model attached.

[Very complex financial model, post later]

Ariel - lots of developers aren’t worrying about the model. Focus on the user experience. focusing on revenue early on can hurt you.

Eve - user experience is key

Eddie - Any advice on focusing on exits? How do you manage a business?

Ariel - want to get traction first, then worry about exit. people don’t understand what it takes to get to a big exit.