John Battelle's Searchblog

Well, Nick, sorry, but here's at least one study backing up my contention:

A new study suggests that searching online could be beneficial for the brain. Searching online triggers areas of the brain that control decision-making and complex reasoning.

A study at the University of California, Los Angeles, measured brain activity of older adults as they searched the Web.

"There's so much interest in exercising our minds as we age," said the researcher, Dr. Gary Small, a professor at the Semel Institute for Neuroscience and Human Behavior at UCLA. "One result of this study is that these technologies are not all bad. They may be good in keeping our brains active."

To study what brains look like when people are searching the Internet, Small recruited two groups of people: one that had minimal computer experience and another that was Web savvy.

Members of the technologically advanced group had more than twice the neural activation than their less experienced counterparts while searching online. Activity occurred in the region of the brain that controls decision-making and complex reasoning, according to Small's study, which appears in the American Journal of Geriatric Psychiatry.

Over at the Amex Blog we're starting a conversation about how this financial crisis effects small business. The site has given me a chance to think more deeply about what it means to run or be part of a small business - none of us here in the Valley like to think of ourselves as "small" but by nearly every definition, we are. And FM works with nearly 200 other "small" businesses. Join the conversation, we all might learn something. From my post:

...But that doesn’t mean I don’t wake up in the middle of the night, worried about what might be coming next. Many of us in the Internet industry are veterans of the last big bust - 2000-2002 - and we can still feel the pain of losing it all (as I did with the Industry Standard), or at the very least, having to cut back to the bone and wait it out. And this time, something feels different. This crisis is not limited to an overinvestment in telecom and Internet, this time our entire financial system has been brought to its knees. How can you not be worried when Congress is in an extended session to determine the best way to spend nearly a trillion dollars, money that, in fact, we don’t actually have (we’ll be borrowing it, given our national debt)?

It’s a well worn saw that as goes small business, so goes the economy. If all of us start laying off employees and cutting back expenses by a third, our economy will go into a deep funk. If, on the other hand, we all declare faith in the future and start acting accordingly, our businesses will become the engine of economic recovery.

So what do we all need to move away from fear, uncertainty, and doubt, and toward faith and optimism in the future? I’m really eager to hear your thoughts and stories. What are you doing to deal with the current economic situation? Given your business and industry, what actions do you want government to take? What stories do you have to tell about how today’s environment is changing your business outlook? Perhaps if we start to talk about this, and share our knowledge, we can start to effect change - one story at a time.

Yesterday Danny posted a typically thoughtful piece on Google's success, on the occasion of its ten year anniversary. Titled The Google Hive Mind, the piece addresses an age-old question about Google: does it have a master plan?

Danny argues that, in essence, the company does not, and runs through a convincing number of examples that support his thesis.

But as with every argument, I think there's another side. Danny writes:

Rather than follow a rigid top-down master plan, the company's direction and success has been shaped by decisions often taken independently of how they'll benefit the company as a whole. But collectively, those decisions DO form a master plan, a hive mind that dictates what the company will do.

I don't agree with this. I think Google has made scores of moves calculated by centralized senior management to benefit the company as a whole, AND, at the same time, has green-lit scores of other projects which, taken as a whole, are in no way centrally planned. Examples of centrally planned moves? The AOL deal. The Dell distribution deal. Chrome. Gmail (I disagree with Danny that this was not a centrally planned move. Same with Checkout.) Book search (Google knew it was in for a legal fight and it engaged because it felt it was in the company's, and culture's, best interest.) YouTube (very much a central decision). Ummmm....going public.

In fact, the going public piece is perhaps the most important one of all. Google has to keep growing, and it has to keep shareholders happy. Growing on a large base is hard, so it's best to try as many new potential big hit markets as you can. That means taking some bets on stuff that might fizzle (Orkut, Knol) and others that might really tick off your best partners and customers (Orkut, Knol, Checkout, and many more).

I think Google has a central plan, and Danny's Hive Mind is a key part of it. As Danny writes:

Perhaps success on the fast moving internet means having a hive mind, a fuzzy business logic where you look more at products individually rather than how they contribute to a master plan. Or maybe that's what you do if you want to be a giant on the internet, offering more than one product.

The hive mind is a great idea, but it's not the whole story of Google. When it comes to key decisions, I think the hive mind that really matters is the triumvirate of Sergey, Larry, and Eric.

Way back when, Larry Page thought it would be a cool idea to know what sites were linking back to any particular page you might be on while browsing the Internet.

In order to scratch that itch, he had to build a graph of the web. That graph became BackRub. But the product never became anything. Instead, he and Sergey realized that the index they had created was an excellent search engine.

That engine became Google.

But....I still want BackRub.

Really, wouldn't it be cool to know who was linking to any particular page you were on? Why isn't anyone making this available as widget? Anyone know of anybody doing it?

If you liked these, you'll also like this:

The ruling yesterday on the merits of Viacom's data requests is worthy of review. Ars has more here. I am preparing for a vacation and can't elaborate, but trust me on this one...

Kevin Kelly makes the point, riffing on Chris's ideas about the "end of theory."

Google knows it has distribution. Distribution is the key to the old school method of media success. Think cable: We have a monopoly on getting programming into homes, so you have to go through us! Therefore, we make shitloads of money. Want more examples? OK: Newspapers. And magazines. And movies. And...well, just about every packaged goods media model on earth.

Well, on the web, distribution is a sort of different deal. Some will argue it's key, others will say search has obviated the economics of distribution.

I think the answer is somewhere in the middle. Sure, if you have great content, search and the force of many will find it, and eventually you will end up with a Boing Boing, or an Ask a Ninja, or a Dooce or a Mashable.

But if you are from Old Hollywood, you don't want to wait for the force of many to find and validate you. Instead, you want to push your product, which you presume, because you are a beknighted Force of Hollywood, that the masses will want to see. (Gee, Mike Myers, how's that working out for you?)

So what to do?

Well, you could pay someone for distribution - Yahoo, Myspace, and AOL come to mind. Or...you could strike a deal with Google, and distribute your show through the Adsense network, which has wicked huge reach.

Yep, you read that right. I've written about this before, but the deal written up in the NYT today is probably the most high profile example yet. From the piece:

Google is experimenting with a new method of distributing original material on the Web, and some Hollywood film financiers are betting millions that the company will succeed.
In September, Seth MacFarlane, creator of “Family Guy” on television, will unveil a carefully guarded new project called “Seth MacFarlane’s Cavalcade of Cartoon Comedy.” Unlike “Family Guy,” which is broadcast on Fox, this animation series will appear exclusively on the Internet.
The innovative part involves the distribution plan. Google will syndicate the program using its AdSense advertising system to thousands of Web sites that are predetermined to be gathering spots for Mr. MacFarlane’s target audience, typically young men. Instead of placing a static ad on a Web page, Google will place a “Cavalcade” video clip.

My prediction, and I could be entirely wrong here: This will fail utterly. Why do I predict this? Two reasons. One, context is everything. Until Google acts like a publisher, and works with sites specifically to place advertising that is relevant to them and integrated, Adsense is an afterthought to those sites. And second, the web is not organized top down. It's organized bottoms up. Distribution is not something you use to push shit AT people, it's something that happens when people organize TOWARD something. That's the whole point of the web, ain't it?

Now, the new "Seth MacFarlane’s Cavalcade of Cartoon Comedy" show could work no matter what, if it's good. If it's good, folks will want it, and they'll click on the Google ads, as well as find it through the collective hivemind that is always created in real time around good stuff. Folks will claim the Google experiment was a hit, and start to mimic it.

But it's NEVER about distribution on the Web. It's ALWAYS about quality. The next time Google tries this, if they are not working with a hit, it will fail.

Is it what people say they value publicly, or what they search for in the privacy of their home? Man, that's a tricky one.

In the trial of a pornographic Web site operator, the defense plans to show that residents of Pensacola are more likely to use Google to search for terms like “orgy” than for “apple pie” or “watermelon.” The publicly accessible data is vague in that it does not specify how many people are searching for the terms, just their relative popularity over time. But the defense lawyer, Lawrence Walters, is arguing that the evidence is sufficient to demonstrate that interest in the sexual subjects exceeds that of more mainstream topics — and that by extension, the sexual material distributed by his client is not outside the norm.

I will admit, I was entirely biased upon reading this story from Nick Carr, who has a knack for writing pieces that get a lot of attention by baiting his hook with contrarian link chum. Heck, he's really good at it, and I have a lot of respect for Nick. So I'll take the bait.

His piece starts by conjuring HAL, the famous AI which manipulates humans, then makes his case by citing his own "feeling" that Google has changed his attention span to somehow prove that search and web browsing in general is making us stupid.

Balderdash. What Carr is really saying is this: People are not reading long narrative anymore, and that makes me and my pals sad. So let's blame the Internet!

Sounds an awful lot like the complaints we heard about TV making us stupid. Did TV make us stupid? I dunno, ask Steven Johnson. I bet he has an opinion on this piece as well.

Carr writes: "Yet, for all that’s been written about the Net, there’s been little consideration of how, exactly, it’s reprogramming us. The Net’s intellectual ethic remains obscure."

So because Nick hasn't come up with a singular thesis as to what the "Net's intellectual ethic" is, we must declare it's making us stupid, eh?

Huh. He goes on to claim that Google is, in essence, an industrial style factory driven by a philosophy that is mechanizing our collective intellect much like factory automation mechanized our collective workforce - in short, Google is turn our minds into nothing more than collective cogs in some borg like hive mind. We're fucked, and it's all Google's fault.

Puuuuuuuhhhhleezzze.

Here's another quote: "The last thing these companies want is to encourage leisurely reading or slow, concentrated thought. It’s in their economic interest to drive us to distraction."

Right. And that's why Google encourages its workers to spend 20% of their time on passion projects. OK.

His conclusion: "As we come to rely on computers to mediate our understanding of the world, it is our own intelligence that flattens into artificial intelligence."

Good lord. Somehow Carr seems to presume that there's simply nothing valuable occurring in our minds when we engage with the extraordinary new medium of the web. Because we're starting to think in different ways, it must be bad. Right? Carr may believe that search and the Internet make us stupid, but I will counter his personal, anecdote-driven conclusions with one of my own: when I am deep in search for knowledge on the web, jumping from link to link, reading deeply in one moment, skimming hundreds of links the next, when I am pulling back to formulate and reformulate queries and devouring new connections as quickly as Google and the Web can serve them up, when I am performing bricolage in real time over the course of hours, I am "feeling" my brain light up, I and "feeling" like I'm getting smarter. A lot smarter, and in a way that only a human can be smarter.

And I have a feeling I'm not alone. What do you guys think?

Over the years I have often pondered the connundrum of Google as a marketing driven company. On the one hand, this company is entirely driven by marketing - hundreds of thousands of businesses, small and large, marketing themselves through the global platform that is Google AdWords and Adsense. Let's not kid ourselves, Google is the most impressive and important development in the history of marketing since the invention of television. And I'm not overstating it. On the other hand, Google has made a point of how it grew without traditional marketing, how it never spends on marketing, how it's unique that way. And yet, it's become the most admired brand in the world! Witness: David Lawee, VP Marketing, last year in BizWeek:

Have you ever done any brand advertising just for Google? We do a lot of direct marketing. But not brand marketing.

Well, David, not true anymore. I've pointed this out over and over, but it's worth repeating anyway: Google is great at harvesting brand demand, but not so good at creating that demand. It's pretty straightforward: Demand creation = brand, Demand harvesting = direct response. Google = Demand harvesting.

But things are changing, slowly, in Google land, and the signs are everywhere. Spotted at today's Giant's ballgame, which I attended (good lord, how do you blow a six run lead, for goodness sakes):

Yes, that is Google, purchasing a sponsorship in the name of one of its applications, Google Maps, at the ballpark, on the strip of LEDs that festoon the upper decks.

You might call it a non-cpc banner display ad in the middle of the web site that is AT&T Park.

From a very early post, back when I used to write like Ars, or TC, or Om, or all those wonderful folks who now work with us at FM:

I've come to the conclusion that Google can no longer afford to avoid consumer marketing. In order for these services to really scale, to get to where they need to go, Google will have to start promoting them. It's unavoidable - even if you do have the best product in the world, you need to tell people about it before they get locked into other options - Yahoo, for example, promotes Travel, Photo, and other services it owns. That's what marketing is, after all. Sure, you probably don't need to market Google search, nor do you need to market in traditional ways. But you sure do need to promote Picasa if you want it to be anything more than a footnote in its space.

Mark Cuban is clearly drinking and blogging again.

How many websites would have to recuse themselves from the Google Index before Google Search was negatively impacted ?

Mahalo.com thinks it needs to support the 25k most common search terms in order to be successful. What would happen if MicroSoft or Yahoo or a MicroHoo went to the 5 top results for the top 25k searches and paid them to leave the Google Index ?

A theoretical maximum of 125k sites, but with overlap, probably closer to 100k or less, times how much per site on average ?

The math starts to get interesting. At $1,000 per site average times 100k sites, thats only $ 1 Billion Dollars. The distribution would obviously favor the larger sites, so of that billion dollars, would the top 1k sites take 500k each and the remaining 99k split the rest ?

Given the stakes, why stop at $ 1 Billion Dollars ? Would the top 1k most visited sites take a cool $1mm each, plus a committment from MicroSoft or Yahoo to drive traffic through their search engines to more than make up for the lost Google Traffic. After all, once consumers realized that Google no longer had valid search results for the top 25k searchs, that traffic would most likely go to MicroSoft and Yahoo.

One big problem: No one would do it. Well, some would, but assuming that folks would be willing to be paid to screw over Google assumes folks 1. have no soul and/or 2. hate Google. I pray that for most folks, #1 is not true, and Google prays that for most folks, #2 is not true. So far, I think we're both right.

But hey, Mark, you have the money! Why not find out?!

I remember being 10, or thereabouts, sitting in front of my parent's stereo system, entranced by the albums they had collected in college. The system - tuner, turntable, and speakers - was a Craig, cheap, Korean, and dependable, an early indication of where the consumer electronics business was heading. I'd put on the albums they owned - Rachmanioff #2, Man of La Mancha, a lot of Kingston Trio - and listen, right up next to the speaker. I was entirely engaged - the albums were transits to another world, a world of music, no matter that it was entirely inconsistent with the world of a ten year old boy. I'm pretty sure the only new album my parents bought between 1953 and 1983 was the soundtrack to Cats, around the time I was a junior in high school.

But that stereo system, the turntable in particular, was my introduction to recorded music.

Now that entire world is dead, gone, history. 30 years after I was entranced, it's been eclipsed by the iPod, the cel phone, the Internet.

Fast forward to now. I look around my house, and I find my son's analog to my parent's music system. And what is it? In a word: Magazines.

I'm a magazine guy. My wife loves them too. We still subscribe to about a dozen of them, and they are all over the house. In particular, they dominate the bathrooms. As my son ponders his mortality on the porcelain throne or in idle moments in our living room, I wonder about the "music" those magazines are bringing to him.

And I wonder, how is the web bringing that music into the digital age? Just a thought, a note written down. For one thing I am certain of. In thirty years from now, magazines will be the albums of their time - an anachronism created for effect, but not a dominant medium of distribution for the music they contain.

I love having kids.

These are the two essential ingredients to any successful media property, to my mind. But I'm not alone, I'm really just parroting Clay Felker, my partner for a few brief years when I taught at Berkeley, and a legendary figure in the world of magazines.

So why do I bring them up? Because for once, I have something nice to say about Time Inc., in particular, its flagship magazine, Time. When I was in Europe, I read the cover story of Time that week, "The Clean Energy Myth." The piece was a winner - a conceptual scoop, an important and timely topic, and - this was the really surprising part - a true argument, an attempt to make a point. It was so refreshing, and so different than the warmed over "on the one hand, on the other hand" pap I was used to from most newsmagazines. This article was great journalism, and it had a serious point of view. The last graf, for example:

Advocates are always careful to point out that biofuels are only part of the solution to global warming, that the world also needs more energy-efficient lightbulbs and homes and factories and lifestyles. And the world does need all those things. But the world is still going to be fighting an uphill battle until it realizes that right now, biofuels aren't part of the solution at all. They're part of the problem.

I figured it had to be an article for only Europe. But when I got back, I was thrilled to see it on the cover here as well. I have not checked, I'm hoping they didn't water it down. But in any case, it struck me that Time was starting to realize what conversational media properties already knew inherently - you can't survive on distribution alone. You need Voice and Point of View.

I noticed another thing about Time recently: The magazine now writes a leader opinion piece, often strongly worded, to kick off the entire magazine. I love this idea, we did it at The Standard. It says "This publication stands for something. We're leaders, arbiters of analysis." Bravo, Time.

(Of course, I think nearly every site represented by FM has Voice and Point of View in some way or another, but I'm biased. Or rather, that's my point of view...)

SEW points to the Googolopoly.pdf on Box.net (an unabashed link bait ploy, I'm biting). The game pokes fun at Google's market share, as well as the current fate of the MSFTs, AOLs, and Yahoos of the world. It's actually well done. But, it's only a matter of time before Hasbro sues these guys, which I am guessing is exactly what they want. (After all, Hasbro is going after Scrabulous...)

In my last overlong bout of thinking out loud, I pondered the role of the ad network in our online media ecosystem, and the apparent connection between the loss of brand-savvy executives at portals with the rise of the ad network/platform strategy as the apparent saving grace for those selfsame portals.

I left that post with these thoughts:

And I have to tell you, neither the publishers nor the brand marketers believe that a magical ad platform will somehow address their needs online. Sure, brand marketers will spend 5-15% of their budget on lower-CPM "pray and spray" DR and awareness campaigns. And sure, publishers are happy - thrilled! - to see algorithms drive up their backfill or remnant inventory CPMs. But none of them believe that ad networks provide the same kind of engagement and brand building opportunities that a simple two-page spread or 30-second spot does in the offline world.

So what *are* their needs? To address that, we need to step back, and think about media brands and marketing brands, and why there's such a symbiotic relationship between the two. Clearly, brands have built what I've called "packaged goods media." And in the past few years, I've come to the same conclusion about online media. In short, I think brands will also build the next batch of great online media companies. And up until recently, I thought Yahoo, AOL, and MSN were best positioned to be those companies. Now, I'm not so sure.

Interestingly, quite an anti-ad network meme has arisen since that post, spurred in part by the news that ESPN is opting out of them entirely. More on that later.

The Brand

But for now...what's my big fascination with brands? And why do I think brands are so important to the next step in the evolution of the web?

There are many definitions of what a brand is (here are a few), but here's my version (bricollage, certainly): a brand is defined by what its potential consumer says to others about that brand.

I'm sure there's a formal symbolic expression of that idea (ie, an algorithm), but I'm going to guess it doesn't scale. And that's pretty much the point.

Brands are, in essence, defined by the conversations your consumers have about your products or services (and yes, I am indebted to Cluetrain and Ogilvy and any number of other great thinkers, even Hopkins, who might justifiably be the bridge between direct response and brand advertising).

Brand advertising in traditional media has been about getting in between the ears of a target consumer in some way and "building brand equity" through media executions. In essence, brand advertising has been, up till now, an attempt to influence the conversation that potential consumers will have after experiencing the advertising.

With conversational media and marketing, that concept is time shifting. Now brand advertising can *join* and even *initiate and convene* those brand conversations. And that requires a different skill set, one media folks are just starting to explore. To date, we've just begun to figure out how to execute marketing in this new form of media in ways that work for all parties concerned - the content producer, the marketer, and the consumer. But that doesn't mean we won't. It just means we have very interesting work ahead of us.

It's Early Yet, Folks

Close your eyes and imagine leafing through your favorite magazine – Vogue, perhaps*. A two-page spread halts your progress - the image of a beautiful, sophisticated woman standing in the doorway of a crumbling Havana doorway, with an elegant brand – “Lancome” – etched in the lower right corner. Or perhaps it’s a spread in Fortune, an arresting montage of imagery featuring a Jaguar automobile, a model you’ve never seen before.

Now, open your eyes, and imagine the same experience online.

Having a hard time? (You're not alone.)

As marketers, we love scale, and we demand safety and quality. But we have yet to nail engagement.

Brand marketers are experts at using traditional media to build demand for their brands – over the past 50 years, we’ve perfected the art of the engaging spread, the irresistible 30-second spot. Online, however, we have yet to find our footing.

Instead, we’ve funded the first ten-plus years of the commercial Internet with direct response dollars, pouring “branded display” budgets into ad networks and CPC vehicles. We’ve tried just about everything, to be sure, and we do buy display units on our favorite sites. Yet we’re often disappointed with the performance they deliver.

To paraphrase Wenda Harris Millard, Chair of the IAB, we must not trade our brands like pork bellies. Brands are not commodities, so why are we judging our online marketing by the standards of direct response? Is it, perhaps, because we can? Or, perhaps, is it because we don’t know how to measure that magic that occurs between a consumer’s ears when they first see the image of a beautiful woman standing in a crumbling doorway?

To keep building our brands, we have to go where the audience has gone. And every month, according to Comscore, 600 million people visit conversational media sites – foreign lands when it comes to brand marketing. Or ….are they?

Clearly, I'm going to argue that it's more than possible to build brands in conversational media. In fact, I believe it's already happening. We're still poking around, trying to find our "thirty second spot for the Web," a standard format that scales and performs. We have our print and television standards. And we have our IAB units online. But clearly, IAB units are not there yet when it comes to building brands.

And that's OK. The commercial web is now a teenager – it’s been fifteen short years since Marc Andreessen released the Mosaic browser. To put this in perspective, television as a commercial medium reached its fifteenth birthday in 1956 - the year Elvis Presley made his first appearance on national TV. National news broadcasts were still in their infancy, As The World Turns debuted as America’s first half-hour soap opera, and The Price Is Right began its dominance of the game show genre. Commercial grade videotape recorders emerged, portable black and white television sets were introduced, and the first local color broadcast aired in Chicago. The thirty second spot had not yet reached scale. In fact, the dominant model was sponsorship and integration. (Remember Hairspray?)

Consumer Brands Love Media Brands, and Media Brands are Changing
Regardless of all the flux in how brand marketing might work online, here's one thing of which I am certain: Consumer brands love media brands. Why? Because the best media brands represent a passionate community who are deeply engaged around a subject of shared interest. Think of some of the best loved media brands - American Idol, Wired, Oprah, The New York Times. All places with a distinctly engaged audience. Consumer brands are drawn to these winners because they want to be associated with quality, sure, but also because they know that if they can just get their executions right, something magical can happen, and they can influence that space between our ears, and in the right context.

And as I've argued in the past, what constitutes a "media brand" online is changing, and dramatically. In the first version of the web, a small handful of Very Big Brands dominated the online media landscape: Yahoo, Excite, MSN, AOL. There was a second tier - Lycos, Netscape (not originally a media brand), etc. - but the big four dominated not only reach, but also overall ad spending. The delta between the major online media brands and the secondary ones was massive, the drop off from there to others (Hotwired, Salon, etc.) was even larger. In short, it was damn near impossible to create a successful, stand alone media brand on the web that had the same scale as, say, a middling cable show or a decent consumer magazine - anywhere from 250,000 to 2 million uniques.

The reason? Brand advertisers did not see the value, and it was way too hard to scale a media buy. To reach, say, millions of business leaders, advertisers could buy six business magazines or six cable shows and run the same creative. They could then see results - lift in brand awareness, perception, and sales. But online, it was hard to find six similar places to run the same creative, and even if they could, the results were not there. Those tiny IAB units were simply not doing what a two-page spread or 30-second spot could do. To get results, they needed massive scale - and they would not pay massive CPMs to get there.

This economic reality drove CPMs down, and the measurability of IAB units added another wrinkle - now marketers could see results directly, and compare them to their spend in direct response type campaigns. It was a race to the lowest common denominator. Portals, with massive traffic, began selling tonnage instead of brand engagement, and the cycle reinforced itself.

So Where Are We Today?

As has been reported widely, more than 80 percent of the advertising inventory on the Web today is sold for less than a $1 CPM. Compare that to the average sold CPM in the magazine business or on television - reports vary, but it's anywhere from six to 40 times higher. That delta, to my mind, has everything to do with engagement.

Or put another way, why is it that a brand marketer looking to reach college educated women, 18-34, is willing to pay $40 CPMs in Vanity Fair, but just $3 in an ad network?

The first and most important reason is engagement - the reader of Vanity Fair is engaged in the magazine, and when she comes across that Lancome ad, the chances that the "between the ears magic" will occur is far greater than at a random site run by an ad network. The second and related reason is creative - a two-page spread is simply a far more effective media vehicle for the brand's message than the IAB unit.

So how do we solve for these two problems on the web?

Well, with Conversational Media, I believe the Web already begun to solve for the first issue. Thousands of great sites have popped up in the past decade, driven by a search, a critical mass of online users, and the confluence of cheap or free platforms (LAMP technology, free publishing tools, and tons of other Web 2 services). Sites like Boing Boing, ProTrade, Graffiti Wall, Dooce, Left Lane News, TechCrunch - these are deeply engaging media brands. Thanks to the new economics of the web, these sites don't need millions of dollars to get to scale, and they don't need millions of dollars to run. And thanks to new approaches to the economics of the media business (yes, I believe FM is such an approach), they have a decent chance of breaking even and even making good profits.

What's very interesting about these new sites is that they are not, in the main, owned and operated by traditional online powerhouses. And that's showing in the numbers: all the hyper growth in the top 20 sites on the Web is with conversational platform and tools - the very sites which spawn new conversational media brands. "Old School" portals and media sites are growing far less fast (see chart below). According to JP Morgan: "While portals were once dominant, Yahoo!, AOL, and Microsoft only accounted for ~ 29% of minutes spent online in August 2007, down from 42% in August 2002. Meanwhile, blogs, online gaming, and social networking websites have experienced double to triple digit Y/Y growth rates in page views."

I believe we are at the beginning of an explosion in online media brands, akin to the explosion of consumer magazine brands in the 1940s and 50s, or the explosion of cable TV brands in the 1980s and 90s. With magazines and cable, we saw a move from a handful of major brands to hundreds of choices, all supported by major consumer marketers. With the Web, I think we can take that an order of magnitude further, or even more - from a handful (AOL, Yahoo, MSN) to thousands, or perhaps even tens of thousands.

But to do so, we need to solve the second issue - which is creative. And that's where I think conversational marketing comes in.

In my third post in this three part series (yes, this is the end of the second, congratulations, you made it!), I'll update my earlier post of a year ago, in which I outlined what CM is, with examples from the past 12 months. There are plenty of great new approaches out there, and they're well worth reviewing in one place. I'll also posit a few new ideas, and as always, hope to learn from your critiques and comments.

----
*This portion adapted from writing I did for the theme of FM's CM Summit, to be held in NYC in June, and the Web 2 Summit, to be held in SF in November.

I've heard Yahoo's local radio ads a few times while driving around the Bay area. I'm going to save my detailed thoughts on them to an audio post, but suffice to say, I had mixed feelings when I heard them. Radio ads in general seem to play over on the stupid side of the yard, but what I found interesting was the direct mention of Google - twice - and the use of an associated wolf howl. Webmasterworld thread on the new ads is here. News.com story here.

Regardless, offline marketing of search can, no doubt, boost share. Why? Because honestly, there's not much further down Yahoo's share can go. With Ask all but throwing in the towel, Yahoo is one notch closer to the bottom (yeah, I know, Microsoft is lower, but I sense they could be, as many in the industry have said to me, lying in the weeds for a reason....).

Marketing can work. For a fleeting moment, before its evisceration, Ask proved it. But tactical and experimental marketing -which clearly is what Yahoo's radio play is all about - has to keep brand in mind. The radio ads, well, they may move the sampling needle, but I'm not sure about the overall brand.

Who's watching that for Yahoo right now?

But wait! There's more!

Tonight I saw a Yahoo integration with a Honda television ad (it was a reasonably annoying green ad, but that's a bit besides the point, as the Honda brand overall has a good vibe). The integration struck me as smart, poorly executed, but possibly very important.

At the end, it showed the Yahoo search interface (it looks nice all alone) and said "For special deals (or something like that), search for Shop Honda on Yahoo".

Of course, the first time I tried it, I only put in "Honda". Who remembers to search for "Shop Honda"? Here is the search and the resulting image at the top of the results:

I think the execution leaves a lot to be desired. First, it does not acknowledge the TV tie in. That breaks a cardinal rule of conversational marketing. The call to action, the initiation of the dialog, was on TV. I responded by searching for Honda on Yahoo. Then I got the above result. While clearly different (it's an "enhanced paid listing"), it should at least acknowledge a link to the original conversation starter - hell, an "As Seen on TV" would have been better. The call to action implied I was going to get something cool for my effort of searching on Yahoo. The response did not pay off.

Now, when you search for "Shop Honda", you get something a bit more conversational.

Not there, but better. The landing page is also a bit more customized (you get a shopping interface!), but man, it's a huge dropped ball. I mean, come on. If someone takes the time to respond to a call to action from a television commercial, at least acknowledge it, thank them for it, and offer some value exchange for the initiation of dialog. But no, nothing like that.

Regardless, I see in this the seed of a very, very good idea in this. I am not sure what the business deal was, but I could imagine really blowing it out along the lines of the Intel Inside campaign (in this pioneering partner marketing program, Intel pays its partners to runs Intel Inside branding in the partner ads. It works.) If Yahoo's going to spend marketing dollars to gain share, it has to do it in a major, integrated way. Why not partner with major national brand advertisers, partially underwriting their TV advertising with an final few frames that say "Search for {insert brand here} on Yahoo for special offers" or somesuch? Once the effort proves itself out in conversions, this marketing program could well become a major money maker for Yahoo. Regardless, it'll really build the brand as an option for commercial searching, in a good way, if it's run with quality, transparency, value and engagement in mind.

Tweak the enhanced listings, offers, and landing pages to better reflect the best practices of conversational marketing, and there could really be a there there. But of course, that takes brand understanding, and what with the focus on ad networks....well.

This idea plays off the one thing Yahoo is (or used to be) really good at - understanding brand advertisers. You can't write an algorithm to do this. You have to think like a human being. It scales, but not without applying conversations to all parts of the execution - and that's scaling humans where humans scale best.

Just a thought.

At SES, while I was on a panel about universal search, Comscore today released some really interesting data. We spent the rest of the hour debating the meaning of if all. It was like getting muffins straight from the oven - no one has seen it, not even the product manager of universal search at Google, whose service the data analyzed.

You can find in the moment coverage of the news here. What I found fascinating about this - not just the data, but the chance to really think about universal search - is the age-old conflict that Google faces between being a pure navigation service - "We get you where you want to go" - and being a media company - "We get you to our properties, where we make more money if you stay."

This conflict is very real, urgent, and present.

To pretend otherwise is to ignore the reality of YouTube, Google News, Google Maps, Google Local, the onebox interface, Knol, and everything else Google owns that represent the chance for them to make money the way every other media company in the world makes money - by competing for your attention and monetizing it with advertising. (I've been on about this for some time).

Google's brand promise - to be neutral, to be above monetary interest - is in conflict with, well, the rest of Google's brand promise, to be a superstar stock, to grow faster than any company in the history of the world. And all of that is in conflict with .... Google's brand promise, to get consumers to the best answer, fastest, regardless of who owns the content. Because...sometimes, that content is now owned by Google. But how to prove that those neutral algorithms picked Google above all else, while avoiding the appearance of conflict?

Universal search interfaces break the ten year stranglehold of ten blue links and surface new media types - images, data sets (like stocks, weather, etc.), videos. In doing so, they also break the conformity of SEO - search engine optimization - and lay bare Google's own editorial choices. Why when you search for stocks does Google Finance come first? Let's be honest here. It's not because some neutral algorithm chose Google Finance. It's because Google owns that data. Google's representative admitted as much on our panel today.

And, given that, can one reasonably ask why, according to Comscore's data, the preponderance of results that come up in Google's universal search are YouTube? Might it be because they are they best results? Sure. Might it also be because Google owns YouTube, which is madly trying to monetize the second, third, and fourth click with new models that it hopes to heck are going to pay off?

Sure. Yahoo's been doing this for a long time. But then, Yahoo's a media company, init? As I wrote in 2005:

"With its shortcuts Yahoo makes no pretense of objectivity—it
is clearly steering searchers toward its own editorial services, which
it believes can satisfy the intent of the search. In effect, Yahoo is
saying “You’re looking for stuff on Usher? We got stuff on Usher,
and it’s good stuff. Try what we suggest; we think it’ll be worth
your time.”
Apparent in that sentiment lies a key distinction between
Google and Yahoo. Yahoo is far more willing to have overt editorial
and commercial agendas, and to let humans intervene in search results
so as to create media that supports those agendas. Google, on
the other hand, is repelled by the idea of becoming a content- or editorially
driven company. While both companies can ostensibly lay
claim to the mission of “organizing the world’s information and
making it accessible” (though only Google actually claims that line
as its mission), they approach the task with vastly different stances." (The Search, page 239-240)

At least, that used to be the difference between Google and Yahoo.

Google is in new and uncharted ground here. And mark my words, it won't be easy for the company to navigate. But then, we knew that, right?

Back a year ago, I wrote a three part series on the future of the media business. It began as an attempt to think out loud about a topic with which I had become obsessed, and it ended up becoming a manifesto of sorts about conversational media and marketing.

As you may recall, I started that last set of posts with the observation that major media companies - Time Warner, NewsCorp, CBS - had all fired or parted ways with the long time managers of their digital assets, opting instead for insiders or traditional media folks with whom they were more comfortable. Out were pioneers like Larry Kramer, Jon Miller, and Ross Levinsohn. In were people with whom the bosses were more comfortable - folks who, in the main, came from television advertising sales backgrounds, the very medium that built those selfsame major media companies. Not surprising - in fact, it kind of made sense. After all, brand marketers were starting to talk about moving serious dollars to the web (following their customers, who had already moved). Best to have folks in charge who have great relationships with brand advertisers, right?

Well, a sequel of sorts is brewing. And this time, the main characters aren't the major media conglomerates, they're the majors of the online world (minus Google - more on that in a second). They are the RC Colas, the Tabs, and the Pepsis to Google's mighty Coke: AOL, Microsoft/MSN, and Yahoo.

And once again, the folks who are leaving or getting the ax are the folks who either built or saved those companies over the past ten years.

The much respected Wenda Millard Harris left (or was pushed out of) Yahoo last year. This was a head scratcher of sorts, because she was much beloved in the world of brand marketers. (And we all know what happened to Wenda's boss Terry Semel late last year: the Hollywood brand genius, hailed as the savior of Yahoo just two years ago, was pushed out year later for failing to chart the right course for the newly floundering behemoth.)

And just last week over at AOL, the person charged with building the company's entire "Platform A" strategy - Curt Viebranz - was either shown the door, or ran for it. Curt is a strong brand guy - he worked at HBO, for goodness sake.

Finally, Joanne Bradford left MSN last week - again, she was an executive who operated at the highest level of trust with major agencies and brand clients.

That's all three people in charge of revenue at all three Google-chasers, all leaving within a span of half a year.

Huh.

Now, why are folks in charge of advertising sales shown the door? For not delivering sales, of course. But not all these folks were fired. In fact, I'm guessing that most of them left after losing a very clearly delineated strategic battle over one very simple question:

How do we truly create value in the media business?

Do we sell inventory to the highest bidder via algorithms, automated processes, and platforms? Or do partner with marketers and creators of media to build brands - both media brands, and consumer marketing brands?

I know how the folks who no longer work at AOL, Yahoo, or MSN feel about this question. They're all brand people. And it's entirely clear how the Google-chasers have answered that question: They've collectively spent billions of dollars amassing "access to inventory" and "ad platforms" in single-minded competition with Google.

It seems the future, according to AOL, Yahoo, and Microsoft, is in ad networks.

It has to be, right? After all, after buying a ton of ad networks, isn't AOL betting its future on "Platform A" - a one stop solution for all your advertising needs? And, after buying a ton of ad networks, isn't Yahoo betting its future on "Apex" - a place where, in Sue Decker's words, "ad operations is sexy" and Yahoo can "eliminate all the friction and complexity that advertisers, publishers, agencies, and exchanges deal with so they can focus on reaching the right audiences and driving greater monetization"? And, after buying a ton of ad networks, isn't Microsoft betting its future on weaving a platform out of aQuantive, AdECN, Rapt, and Yahoo itself? (Not to mention all the chess moves blocking Google out with non-economic deals on Facebook, Viacom, and others - a practice has Yahoo engaged in as well.)

The reason for all these moves, of course, is that Google already had the biggest ad platform of them all - Adsense - and last year, it won Doubleclick to boot. Google is building the biggest, baddest, most futuristic network of them all.

And every single one of their competitors - AOL, Microsoft, and Yahoo - are chasing Google's tail.

Straight down a rat hole. (A direct response rathole, I might add - the majority of dollars on the web are still in DR).

Because while it makes perfect sense for a company like Google to build out a killer ad platform, it makes a lot less sense for companies like AOL, MSN, or Yahoo to do so. The reason is simple: AOL, MSN, and Yahoo are in essence media-driven companies. Google is driven by scale and technology. Brands are about media. Ad networks are about scale and technology.

I see the logic in why AOL, MSN and Yahoo are chasing the ad network dream. They have a ton of inventory. Most of it is making money at very low CPMs - as low as 50 cents on average. If they can drive that CPM to 75 cents through an ad network strategy, their margins go way up, and they all come out looking like heroes.

But then what?

The future of marketing isn't going to be built by ad networks, exchanges, or platforms. These scaled technologies are not going to address most pressing issues that marketers now face online. In fact, ad networks have become the problem. Not because they don't have a place, or don't add value- they most certainly do. No, ad networks are the problem for one simple reason: the very companies who just two years ago were best positioned to help major brands move online have turned away from the principles dearest to brand marketing, and instead convinced themselves that if they only build the coolest platform with tons of inventory, scaled pools of market liquidity, and the best algorithms to sew it all together, they too can achieve what Google has done: win in the marketplace.

But they're wrong.

While technology and ad platforms are essential components of digital marketing's future, they fail to address the core needs of brand marketers: engagement. And they fail to address the core needs of digital publishers: the support of marketers that allow them to make a decent living. And while Google is amazing, Google isn't a brand marketing-driven company. It's revolutionized direct response, to be sure. It's the most efficient harvester of brand equity in the world, but it's not built to create that equity. It has pulled the curtain back on many of the foibles and follies of brand marketing. But until someone writes an algorithm for human conversation, Google will not lead the way toward the next step in marketing brands online.

Let me elaborate. I've spent the past three years in a very deep conversation with two types of media players. First, the creators of a new kind of media property. I call this kind of property "conversational media" but you may as well just call it a "publication" - sites on the web that, at their core, are about passionate audiences engaged in the creation and consumption of media that feeds them in some way. Properties that are, in essence, brands. Brands like Dooce, Boing Boing, Protrade, Watercooler, Ask A Ninja, Left Lane News. I am drawn to these brands - I believe they represent the best the Web has to offer. Everywhere you look, new ones are popping up, driven by entrepreneurial creators who, sure, would like to make a buck, but in the end, couldn't really see themselves doing anything else but make media.

I love these folks.

The other type of media player with whom I have been in deep conversation is the brand marketer. From GM to Procter, Intel to Sears, Ogilvy to Carat, McCann to Media Kitchen, I have spent countless hours in extremely engaging conversations with the people who are charged with creating, nurturing, building, and curating consumer brands. And you know what? I love these folks too. These are the folks who truly believe in media. These are the folks who helped us build the magazine industry, the television industry, and the first version of the online industry.

And I have to tell you, neither the publishers nor the brand marketers believe that a magical ad platform will somehow address their needs online. Sure, brand marketers will spend 5-15% of their budget on lower-CPM "pray and spray" DR and awareness campaigns. And sure, publishers are happy - thrilled! - to see algorithms drive up their backfill or remnant inventory CPMs. But none of them believe that ad networks provide the same kind of engagement and brand building opportunities that a simple two-page spread or 30-second spot does in the offline world.

So what *are* their needs? To address that, we need to step back, and think about media brands and marketing brands, and why there's such a symbiotic relationship between the two. Clearly, brands have built what I've called "packaged goods media." And in the past few years, I've come to the same conclusion about online media. In short, I think brands will also build the next batch of great online media companies. And up until recently, I thought Yahoo, AOL, and MSN were best positioned to be those companies. Now, I'm not so sure.

And as much as I'd like to keep going, that will have to come in the second post in this series (and that may be a few days, as I am traveling, again, for at least half of this week). This post is already 1500 words long, and I'm as tired as you all are, I am sure. So thanks for listening, and let me know what you think so far in the comments....

One of my favorite parts of Hulu is that it's halfway to the video grammar in which I hope our culture gets to participate. What do I mean by that? Well, imagine the ability to take bits and pieces of video content and mash it up to create new stuff. How cool would that be?

It starts with the ability to share discrete portions of content. With Hulu, we can do that. Check out this bit of The Office. I selected the scene at pretty much random, but it shows how discrete units can be shared:

This is a big step.