In-Game Advertising, What Could Possibly Go Wrong - My Latest Article for Ten Ton Hammer

In Game Advertising Could Be the Next Best Thing to Gaming
By J.P. "Agon Thalia" Sherman

There's no easy way to say this… ingame ads are here and they're only going to get more prevalent. There are racing games that contextually place billboard ads according to the players' web traffic habits, there are plans to make interactive items ingame, like a can of Sprite on a table that a player can "drink". Some ingame art like graffiti can change according to advertisers demands. Even now, Google is courting with companies like AdScape Media to put their own brand of personalized, customized and targeted advertisements inside our games. I have seen the future and it is full of ads.

Read the Entire Article at Ten Ton Hammer...

2000 Blogs/ 55 Million = 3.6x10^-3% of the Blogosphere

Tino Buntic has decided to put up the faces and links to 2000 bloggers. It doesn't matter if they're A-List, D-List or complete unknowns. He's creating a very cool little mosaic blogging meme.

And of course, I had to submit myself.

Shout out to Cord Silverstein of Marketing Hipster for letting me know of this. My pic's a little fuzzy and I look 15 because of the hat.. but what the hell, it's fun!

My Name Is Earl: Drives Traffic Online and Adds Viewers

You know the kind of guy who does nothing but watch TV and analyze it on the net, then wonders why his friends think he's crazy? Well, that was me. Every time I watched something good or bad on TV, something had to be posted on the internet. That’s when I realized I had to change. My name is JP.

I really enjoy the show My Name Is Earl. I started watching it because I would turn on the TiVo early so I could fast-forward the commercials during The Office. The last episode of the show, "Kept a Guy Locked in a Truck" the character Josh gets killed in a tragic murphy bed incident. wait... let me rewind.

Joy, Earl's ex-wife, wanted to get back at a store for refusing her return, so in retribution, she stole one of the store's delivery trucks. She enlisted Earl to help, which he did because he was trying to make up his past sins toward Joy. They hide the truck for a few days. When they open it up, they find that there was an employee "Josh" locked in the truck. Eventually, Joy was booked for kidnapping and Josh was the only witness. Well, in the last episode, Josh dies when his murphy bed snaps back into the wall and crushes him.

As the story progresses, we find that Josh is a regular poster to the TV forum, review and recap site, Television Without Pity under the name "whojackie". During the show, he's shown typing on his computer and saying:

"No, I don’t think shows should do more meta jokes that cater to the online bloggers and I’m sure everyone at Television Without Pity Dot Com agrees with me."

Turns out that whojackie has been an active member for over two years, and on the day the show airs, there's a post from whojackie. Later on in the show, Joy tries to find friends to attend Josh's funeral and posts to the wide wide world of web.

My point is that NBC is brilliantly driving people online, in a round-about way to consume their content. Giving a shout out to Television Without Pity is a great way to create buzz among fans, give interaction between the stars and their fans and create a level of "reality" that's just fun and unique.

Later on in the thread, there are people who hadn't seen the show hear about what happened, and what they've done is watch some of the shows that NBC has on their site and they've been converted into viewers. Another thing that the producers of My Name is Earl does, is set up, through TWoP, a "whojackie Memorial", where all proceeds go to the Make-A-Wish Foundation.

Brilliant move for NBC, Greg Garcia and the entire show. Not only did they create perfect viral buzz among their target market, they did so well, that they're adding new viewers because of the efforts. They deserve every accolade they get, and more.

Freaking Brilliant

PS: Shout-out to Koenig
Edit: Crabman responds
Edit: Josh's death foreshadowed from Dec.

User Generated Video Popular, Yet Hard to Monetize

eMarketer, one of the best sources for marketing information, research and analysis posted an interesting article the other day about user generated online video (UGOV). They referenced a study from London's Screen Digest that found that user generated online video was responsible for 47% of all the video consumed in the US in 2006. They further predict that by 2010, UGOV will account for 55% (44 billion streams) of video consumption on the net.

Like my prior article about monetizing virtual worlds, companies and marketers are looking at the sheer numbers of eyes on the monitor and they're recognizing that this could become a significant source of revenue and branding for them. eMarketer goes on to recognize that while UGOV is a significant source of traffic and media consumption, it only accounts for 15% of revenue from online video sources.

So what's a company to do? How does one create a stable business and profit around UGOV? One answer is to do what Current TV is doing. One of the ways is to create a cable channel like Current TV. I truly enjoy Current TV. They're edgy, they're smart and they create an addictive program watching experience. I like the fact that in the span of an hour, I can be touched, offended, enlightened, frightened and entertained by their submitted videos. Current TV drives traffic to their site and the site drives users to their TV. I enjoy what they do and I think they do it well.

Another option is to monetize the traffic that comes into the site by putting ads and sponsored links on the site. However, this may backfire on the providers when ads start piling up on the videos they want to watch. iFilm and Atom films do a good job with putting short ads on their content, but as more and more providers emerge, it'll be tougher to insure that the users are getting what they want, without sacrificing their credibility. Lastly, if I can watch the same video without ads, what's my motivation to watch the ads?

There are other ways to monetize the streams and traffic: digital sales, subscriptions and licencing technology. The desire to generate revenue has reached a point, where it's becoming like the multimedia "industry" in the early 90's.

Viddling Around blog has an excellent commentary that ties in Esther Dyson's "blasphemous" but accurate comment that there "Was no Multimedia Industry". She maintained that multimedia was a feature and not an industry. The post goes on to note that we may be following the same path now and treating UGOV as an industry and not a feature for relevant sites.

The eMarketer article goes on to say that in 2006, revenues from UGOV sites reached $200 Million in advertising revenue. They predict that in 2010, that revenue will increase to over $900 Million.

I however, remain skeptical of that prediction. I believe it's based on current trending only and the theory that they're treating UGOV as an industry in and of itself... not a feature. Only time will tell at this point.

I think that UGOV has huge potential for relevant and contextual markets, but the rush to profit from it reminds me of a few other internet revolution bubbles. It's exciting, it's exhilarating, it's cool and it's hot... but I agree with Viddling Blog and Esther Dyson, it's a feature, not an industry.

Virtual Worlds Get Their Own Conference

Virtual worlds have been getting a lot of attention lately. It seems that people are realizing that digital property can translate into real world profit. In the past year, we've seen companies like Dell make announcements in Second Life and even some politicians like George Miller and Mark Warner have held events there as well. We've seen ideas about the taxation of virtual property, and even companies that run online worlds help real world police find criminals and victims.
The amazing thing about this, is that all this has started to reach a watershed after World of Warcraft announced that it has over 7 million (with an "M") subscribers. Even recently, they announced that they just reached the 8 million mark. Good for them! They deserve it.

With the attention focused on virtual worlds, it seems as if companies, marketers and even the government are all scrambling into a multi-billion dollar industry because they all smell profit. While I have nothing against the free market, I can almost see the gaming community start smirking and waiting to pounce on the poor bastards who make stupid mistakes while trying to communicate to an educated, creative, intelligent and highly defensive and protective community.

Even Sony, the makers of the PlayStation and some of the best games around were pounded mercilessly for their ill-conceived "All I want for Xmas is a PSP" campaign. If there was any company that had some good will stocked up for all its done for us, Sony would be one of them. Nope. They were humbled and shamed into submission for its miserable and, in my opinion, patronizing campaign.

It's been announced by Digital Media Wire, that there will be a virtual worlds conference, to be held in New York. From the article:

"Fortune 500 companies seeking to understand and maximize marketing, entertainment and business strategies within virtual worlds."

I wholeheartedly support the efforts to embrace and understand virtual worlds and the people that inhabit them. I hope that the conference will educate those Fortune 500 companies that they need to do their homework first. I hope that when those companies enter our digital domains that they do so contextually, appropriately, entertainingly and respectfully.

However, I know that not all of them will. I predict that in the next year, there will be a company that jumps into a virtual world, hoping to connect to the gaming community and will get slammed against a wall with such force, other companies will think twice about entering our domain again.

Games marketing have come up with some real nuggets of pure advertising dren, and the good folks at 1UP were kind enough to share some of the worst with all of us. I would like to think that the worst is behind us, but I seriously doubt it. I would like to say that the conference will educate the people of the Fortune 500 to tread carefully, do their homework and for god's sake... talk to us first.

The topics to be covered in the conference will include:

understanding consumer behavior patterns inside virtual worlds; technology and design issues; and the benefits of standalone immersive corporate worlds versus destinations within "Second Life."

While I think that this would be a fascinating, exhilarating and educational conference. I have a hard time believing that these companies are there to understand a rapidly growing social phenomena. Instead, I think that they might just be there to learn how to profit from our virtual worlds.

We'll see if they gain credibility, I hope they figure out a way to enter the virtual world and not make asses of themselves. But we all know that at least one of them will do exactly that this year. I wonder which one it will be?

Standard Deviation When lnterpreting Web Analytics

One of my favorite blogs, Good Math, Bad Math has an excellent article describing standard deviation as it relates to the mean of the data.

The mean is more commonly called the average. It's calculated by the sum of the total data points in the population, then divided by the number of data points. A simple example of that would be the data set: (1, 2, 3, 4, 5). The sum of this population equals 15. There are 5 data points in this population, so the mean would be calculated as 15/5=3.

A fancier way to put it would be the following formula:



We can see through web analytics the average visitors per period of time... daily, weekly, monthly. However, measuring by mean alone can be deceptive. The mean doesnt describe some of the more important data sets that are important in determining the meaning of analytics.

The mean wont give you information on the low points, the high points, nor will they tell you the relationship of the mean between the rest of the data. In the earlier data set, the relationship between the data was very easy to determine. In web analytics, those relationships can be a little trickier.

I'll take an example that's near to me. My own web analytics.

Currently, I average 42 page views per day. This means that 42 of my unique pages are viewed... this is not a site visit. My low point is 4 page views in a single day and my highest is 124.

From this, we can tell that there was most likely a spike in my page views at some point. Because the mean is less than twice the largest data point, we can automatically start with that presumption. However, in order to get more information, we must take into account the standard deviation. It is defined as a measure of the spread of its values also, the square root of the variance. (From Wikipedia)

Each differently colored area is the standard deviation. Each section is the same length, but not the same area under the curve. This means that within one standard deviation of the mean, most of the data falls under those data points.

In my case, my standard deviation is calculated as 9.4.

What this means, is that using Chebyshev's Inequality rule,

At least 50% of the values are within 1.4 standard deviations from the mean.

At least 75% of the values are within 2 standard deviations from the mean.

At least 89% of the values are within 3 standard deviations from the mean.

At least 94% of the values are within 4 standard deviations from the mean.

At least 96% of the values are within 5 standard deviations from the mean.

At least 97% of the values are within 6 standard deviations from the mean.

At least 98% of the values are within 7 standard deviations from the mean.

At least 1 - 1/k² of the values are within k standard deviations from the mean.

When you apply this information to web analytics, one of the things I do is look at the geographic distribution of the users. When I find hubs of higher consumer acitivity, I start getting a clearer idea to who my users are. This could help me target my paid search campaign more accurately, this could let me know that if I provide content, analysis or a blog, a nice mention of something applicable and interesting in their area might be appropriate.

The standard deviation is a powerful method to segment your analytics into greater specificity. When Chebyshev's Inequality shows you that 75% of the data is within two standard deviations, then you have some focused and applicable data to improve your messaging and targeting.

More on Evidence Based Managment

I love this cartoon, and as I go through Pfeffer and Suttons' book, there are parts of the book that remind me of this.

This cartoon has been used to entertain math geeks, critique pseudoscience like Intelligent Design, and brilliantly show that knowledge starts with data and ends with something useful (hopefully). But somewhere in the middle is the arduous task of analysis, being wrong, being frustrated, hard work, peer review and all of the un-sexy stuff that gets ignored.

It's kind of a small rant, but it's the "CSI-ification" of science or analysis... they get a clue, then some fancy camera shots and a high tech lab... chemicals and viola! They get the information they need to catch the bad guy.

The miracle is hard work... it's the analysis, it's the brainstorming of lots of smart people trying to figure it out. To call it a miracle is almost an insult... and that's why I love this cartoon