In a world of likes, what is the value of engagement?
Facebook made “like” easy. Just a click. No comments, no attachment, no real interaction. Just a click.
So why do we constantly value our campaigns and social activities by this low effort measurement?
It might be that we don’t have enough tools to really understand the value and quality of our social web marketing activities.
But it might be because it is easier to count likes and fans than get to the bottom of these new tools and platforms.
And maybe it’s because we are working too hard to be cool and “social” and “new” that we forget that social marketing is at the end of the day a part of digital marketing – which in turn suppose to provide clear business value.
Engagement doesn’t matter if it doesn’t grow the business. Likes are useless if they don’t help the company to grow by either lowering costs, increasing revenues, or increasing customer satisfaction.
Digital marketers have a huge responsibility – we are ahead of the curve for most of our clients. We should always remember that at the end of the day we need to justify our retainer and project fees, with proper increase in revenues – or achievement of a clear business goal.

So, what’s the business value of Like?

Michael Eisenberg, an Israeli VC, wrote two thought provoking posts about the way the government  invest properly in Israeli High Tech. From Microsoft and .Net monopoly through iPad banning, to poor distribution of CSO funds, our government neglects the important aspects of maintaining Israel’s technological leadership.
Though not a VC, I’ve worked in several industries, from mobile to internet to media, and I meet a lot of startups in different stages. And I think that though Michael is right in his claims, there is another angle to this story – the core competencies of the Israeli industry is not as important as in the past.

Origins of Israeli High Tech
Israel’s High Tech originated, broadly speaking, from 4 sources:
1. Technological army units such as 8200, Air force and Mamram
2. Universities such as Technion
3. Russian immigration
4. ECI/Comverse RAD group and other major companies, whose employees who jumped ship and opened their own startups.

The strong points of these sources were electrical engineering and telecom oriented know how.

The Best Beta Site
Israel has one of the highest mobile and broadband penetration rates. Therefore, a mobile startup could easily sign a deal with a local mobile operator and make it a beta site. The local mobile industry was at the same level as  European mobile markets, so Israeli companies could launch products in that huge market relatively easily, as it was close to what they had locally. I was a part of such process when working with Flash Networks. First we sold our product to Orange, and then to T-Mobile. We knew what was needed in order to build and deploy a product in such an environment.

Media and Internet are Winning. Pipes are losing.
However, the market changed. World wide innovation lies more and more in internet companies. Hulu is more innovative then Motorola. Google is more innovative (and profitable) then Nokia. Mobile operators are not as important in the value chain as they were before. And Apple is changing the game again and again with innovative hardware and software.

Failure in  Growing the Business
Most Israeli companies are just not big enough, or maybe not with the right culture and financial resources to win over the mobile and telecom market and create the next Nokia or even next iPhone. The last guys who tried it failed and closed shop, not to mention their founder’s financial trouble. Yes, I am talking about Else Mobile and Eli Reifman‘s troubles. So in that area we are basically, well, screwed.

No Longer a Beta Site
So let’s look at the Israeli internet industry. Unlike the mobile market, there is a huge difference between local internet industry to international or American one. While video is growing drastically in the US, and major media companies experimenting with new business models, our market is just too small, too centralized, to make companies feel their bread and butter is at risk. With 3-4 major media players (Hot, Yes, Reshet, Keshet), and two major portals (Walla, Ynet) no one has the incentive to innovate. They are making enough money as is, and digital cents are not even on their map, as no one buys content here.
We don’t have an Israeli iTunes. We don’t have an Israeli Hulu. We don’t have an Israeli Huffington Post. We don’t have an Israeli ereader market (Sorry E-vrit, not enough units sold yet). Come on, iPhone, one of the biggest media innovations, landed here less than a year ago.
Amazingly, there is a huge gap between Startup innovation and portals’ adoption of technology.
So the Israeli media and internet is like Shakshuka – some great cutting edge media technology (eggs) floating in a sea of not extremely innovative portals (tomato sauce).

Culture
With technology less of an issue and winning product is the focus in the online and media industry – culture and media consumption habits become the key for creating a winning company. And, we don’t have the visibility of neither. Cause our local market is so different.

Is This The End?
Is this the end of Israeli startup industry? No. There are several amazing content and media companies here in Israel such as Innovid, Outbrain and many more.
But we need to start think differently. It is not like 8200 will start to create cool video players so Israeli innovation won’t die. But it might be that in the future these units won’t be as important in Israeli High Tech as in the past.

Possible Solution
We need a simple plan – and do the so unIsraeli thing to do- actually follow it. We should encourage Hot, Yes and the major portals to invest in innovation. It might be through tax incentives or other ways, but we should give them a reason to do so, cause they don’t have one now.
We should create special incubators for media companies with international media veterans. I have couple of names in mind.
And we should take into consideration that the market is going to change to the worse for us. As Michael said, we are definitely not competitive in price. If the current situation will continue, we will lose our technological edge as well.

What’s Wrong with this  Post?
If you know me you know that I love well established facts. Unfortunately I don’t have the numbers to back the claims here. It is based on personal experience and being in the industry for 10 years.
Would love to hear your opinion.

A Friend

A lot of exciting things happened recently, and can’t wait to tell you all about it. However they affected our blog updates, and we are now getting back to speed with that too…
The incentives of Affiliate Marketing
Affiliate marketing is an important tool in online marketer toolbox. Companies big and small use this method to reach new audiences effectively. The principle is simple – Company A provides incentives to everyone online to promote their product. Usually a cut of the deal is paid to the affiliate. Companies such as Amazon provide dedicated links and widgets for these partners who in turn distribute them to their audience.
Besides Amazon and other well known brands, many found affiliate marketing a profitable business in other business line such as diet and nutrition and investment tools . In many cases a small operation of two to three smart people, with strong knowledge in SEO and PPC can make a lot of money in these activities.
Affiliate marketing is in many cases more a science than art. Where everything can be measured, smart affiliate marketers optimize their efforts again and again to reach the best conversion rate possible. The ability to instantly measure every activity as well as reassign resources makes it a very dynamic business.
Some in this business are using tactics that are ethically questionable such as fake blogs and spam.
Brands are interested in creating meaningful relationships with their audience, in order to make their brand affect buying decisions.
In short, while affiliate marketing is all about one night stands with customers, branding is more like a long term relationship.
Efficiency of Social Media
Social channels are all about creating meaningful connection with current and potential customers. Unlike other channels, here the brand is acting within the personal space of the customer. That’s because people go to Facebook and Twitter to talk with friends and family, and not necessarily in order to consume content. The content they do consume is usually recommended by friends, or sent to them based on their permission (such as joining a Facebook page of a product or a brand). In social channels it is all about trust – brands can increase the trust of their target audience while engaging with them and giving them value. These channels offer many for affiliate marketers as well. Do a little test: twit several times about forex and diet and see how hoards of great looking, well endowed women follow you and offer you to get rich and fit in less than 10 days. Many find it rude.
This is the risk for brands. Let’s say that Joann, 19 yo, beautiful brunette just offered me a unique diet that will make me the hottest guy around, and when I click the link I am getting to a reputable brand’s page – how would it make me feel re this brand? Would I continue to trust it? And let say that I am looking for info about a company and see that the only mentions on twitter are by Joann and her friends – would I trust that company? And if all the raving reviews about this company are from blogs that look like fake ones – how would that affect my perception of the brand?
Brands, Short Term Relationships and Incentives
Everyone wants to make money. This is not a shocker. But there are different ways to make money. Some companies are focusing on short term gain, and some are focusing on building and maintaining a brand. The brand strategy takes time and effort. Not only that but association with spam and other ethically questionable tactics can harm brands more than the value of increased exposure gained by using these tools.
While affiliate marketers aim is to increase conversion, brands are interested in creating brand equity – meaning, making their brand count. This is a basic difference in incentives.
So while our imaginary Joann could provide great conversion rate for the affiliate marketer, the brand she is referring to might suffer from that activity even if in the short run they will sell more of their products. And while it was always true, the trust based system of social media increases the potential damage for brands.
So What Can You Do?
It all boils down to strategy. If your company doesn’t care about branding – affiliate is the way to go. If branding is crucial, but so is affiliate marketing, consider separating brands, or find ways to impose at least some guidelines on your affiliates. It’s tricky but feasible. As long as you know what you lose and what you gain in each strategy, you will be able to find the best way to grow your business.

After spending tens of dollars on iPad apps, I can tell you one thing – developers are still in the dark re the UI of this device. However it doesn’t stop them from charging more than $10 for an ever crashing app.
While iWork apps prove to be stable and usable, others are just riding the hype. I couldn’t finish a 2 minutes session of Elements, without a crash. It didn’t stop the developers from charging $14 for it. And yes, I am talking about a periodic table, with fancy pictures. Compare it to an amazingly useful GoodReader, that costs $0.99, and you start to see how misguided the iPad apps pricing is. SocialReader is another great idea done wrong, that cost $1.99.
And while Things is overpriced but useful ($19.99), the guys from Omni Group are asking for $49.99 for OmniGraffle, a diagram application.

I have to admit that some of the best applications are the free ones. NYT is awesome. The same for Bloomberg and BBC. Gaurdian’s Eyewitness app is great too.

Now, I am all for pricing applications based on their value. But many of the apps on my iPad are simply unstable to the point of unusable.

I have a short list of apps that I really like to use. But I will wait until sanity regained in the pricing of iPad apps.

Apple is continuously  under fire for lack of openness. Once the industry’s underdog, as it’s market power grows, Apple slowly becoming the target of many attacks, the latest one from Tim O’Reilly.

Interestingly enough, Apple never claimed to be open. Or nice. Apple claimed one thing only – that it knows how to create great innovative products. They aren’t cheap. They are good. and that’s how the Cupertino based company mange to have 10% market share with 83% market cap in comparison to Microsoft.

The myth of openness
Being open is a business decision. Nothing more and nothing less. Some companies harness openness to cut development cost (open source companies are great example). Some do it in order to cultivate a vibrant development community that in turn increase its value and market power (Google is a good example). But there is nothing sacred or better in openness.

The irony is that one of the most so called open companies in the world, Twitter, just dropped an A bomb on its ecosystem, when it announced the development of desktop and mobile clients. While the blogsphere is attacking Apple and praising Twitter, the industry darling itself single-handedly sent the companies that made it so succesful to the deadpool.

So, let’s stop being naive. At the end, it is all about business. The rest is fluff.

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As magazine publishers are looking for ways to survive the digital revolution, there is one knight in shining armor – the iPad. At VDZ’s Digital innovator summit, the “magical” device was mentioned every second panel. Booths at the exhibition area showed protoypes of iPad applications, and CMS vendors stated that they are planning iPad support sooner then later.

However, amazingly enough, most of the people I’ve talked with never saw the iPad or held it in their own hands. Most of their knowledge about the device derived from Apple’s announcement and blogs – not first hand impression.

Though seems strange at first, that a whole industry would be betting its future on a device that almost no one  used or seen, when looking t the deatails, the iPad is a publisher’s wet dream:

1.  A sexy device

2. That provide a rich media experience, way better than the black and white Kindle

3. With embedded DRM, billing, and distribution mechanism

Based on iPhone and iPod success, iPad has the potential to become the magazine industry’s savior. However, magazines could not rely on single device or concept to be the answer of  all their woes.

Want to know what P&G told publishers about their future? check out this post.

Facebook is slowly removing many of the elements that made it a marketer’s wet dream.

Facebook announced several major changes that affect marketers using the platform to promote their services:
1. Splitting feeds to news feed and live feed – users see, as defualt, a feed with only content and comments from their friends. Information about groups etc was moved to a separate feed.
2. Removal of app notification - Facebook apps will not be able to send notifications to users.
These changes reduce the virality of the platform in a major way.
For example, if in the past one could invite friends to become fans of a page, and his friends would have seen that he joined, now they wouldn’t see it unless they look for it. This effect was crucial for virality of fan pages and applications. The same goes for notifications.
While many users rejoice, as they see more relevant and focused information on their feed and notification tab, marketers should rethink the way they interact in Facebook.

The two most important consequences for marketers are:

1.  Advertising becomes more important in creating traffic to Facebook applications and fan pages - without virality, paid advertisement within the platform, or in other channels, is an important part of any Facebook marketing activity

2. Fan pages and apps should provide more value to users, as it will be more difficult to attract repeat visitors.

In the next part we will discuss additional changes in the platform and what are the opportunities for marketers in this area.

Last week, the online video world rejoiced. For the first time, Hulu, the online premium video provider, had more viewers than Time Warner Cable subscribers. Pro online video folks all around gathered to support the revolution as it unfolds.

The only thing missing is, well, like in most cases, money. Hulu is making small time money compared to Time Warner Cable.

The paradigm of digital cents is very simple – services are much cheaper on the internet, and the value of goods is diminished when they are distributed or sold digitally. The full phrase states that the media industry is facing a challenge – as it transforms from analog dollars to digital cents. This issue is affecting advertisers who are asking agencies to shift dollars from expensive TV spots to cheaper online advertising, which in return hurts the media business.

Hulu, though delivering the same shows as TV channels, is not making as much money as the traditional providers. This is a major challenge to the whole media industry. But it is not alone.

The slow demise of the walled garden adds another pressure, to a different section of the value chain – the operators. The mobile market is a great example how technology is threatening the old world order. Early in this decade, when GPRS launched all over Europe, operators believed that the answer of their declining voice ARPU would come from selling content, such as ringtones and wallpapers.

The basis of this strategy was the operators controlled the availability of content to users – whatever an operator put on its portal could be sold – but nothing else. This way, by creating scarcity, the operators could gain revenues and control the subscriber’s experience.

Then came Apple.

And Google.

And Nokia.

And all these companies decided to break operator’s hegemony and tear down the garden’s walls. Android, iPhone and Ovi challenge the mobile operator’s ability to control the content and customer experience.

While media companies such as NBC and HBO don’t have a choice but to be a part of the digital cents game, operators have some ways to leverage this market disruption to their advantage.

Services are, in my opinion, a key to change the cents to dollars. Some of them are clear but still not done well, such as three screen syncing – allowing users to start watching a show on their TV set and continue to watch it on their mobile phone.

Some are based on cutting deals with the devil – and tightly integrate web services with traditional TV content. Several companies unveiled such services, such as TV and Twitter integration.

And some are downright evil, such as disregarding net neutrality and providing differentiated quality of services to content providers, based on deals with preferred content providers.

If operators will succeed in finding the right services and implement them in the near future,  we might see that they will rise to play a more significant role in  the media industry.

It’s phenomenal growth shows that a limited, real time network answers a market need, which in turn becomes an opportunity for brands and service providers.

We also see a phenomenal click through rate on links in Twitter messages, probably due to the fact that  Twitter users are there in order to interact and consume content. This interaction makes Twitter a powerful distribution platform.

Twitter started the real time microblogging revolution.

But, risking actually having to eat my hat for this post in the future, I believe that in the long run it won’t sustain as an independent network.

Twitter suffers from several core issues:

1. Lack of context – there is almost no way to track conversation and actually understand how conversations develop in the network

2. Limited extensibility – the 140 characters limit makes it extremely complex to create services based on this protocol (tip hat to Gil Dibner for this one)

3. Lack of groups and filtering – users cannot group contacts based on interest or other parameters and broadcast a message only to them. For example, if I am on a diet, and would like to share it with a community in real time, it might be the case that I wouldn’t be interested that my business partners will be aware of that. Today, the only way to do it is to create separate Twitter accounts for each group, and convince relevant people to follow it.

4. Non intuitive interaction and interface – how many times did you try to define what’s Twitter to your mom? And how easy it is with Facebook? And how complex it is for new users to “get” what is it all about? I believe that this is one of the main reasons of the 60% service churn reported recently.

I strongly believe that real time Microblogging will prevail – as it has a lot to offer. But taking these issues into consideration, we will see that Twitter as a service, will have limited long term growth.

So what will be the future of Microblogging?

1. We will see more and more communities integrate Twitter-like functionality in their sites – for example, no reason why a diet site won’t allow users to interact in a closed, real time, microblogging environment. These niche real time communities will fragment Twitter potential user base and diminish the value of a general purpose network.

2. Major portals will add their own version of microblogging as well – Yahoo! is already doing it, and Facebook/Friendfeed deal might show the direction they are taking. This will be another nail in the coffin of Twitter as general purpose network.

3. Twitter as an independent network will either collapse due to spam, lack of groups and other issues, or will be bought by one of the major online players – for their users base. It will always have a hardcore fan base, but it won’t be enough, in my opinion, to sustain it financially.

Twitter might be the forerunner in bringing the real time microblogging revolution to the masses. But it might well be,  that just like Che Guevara,  it won’t enjoy the fruits of the revolution it created.

You are tech savvy and a social media enthusiast with REAL followers on twitter, Facebook and Linkedin. You speak Hebrew and English fluently.
And you love all things beautiful, and appreciate the importance of visual elements in everything we do.

It would be also great if you have project or account management experience, B2B or B2C marketing know how, you love all things Mac, have video editing, directing or shooting experience and you are an active blogger

We are a B2B/B2C digital agency, with publicly traded international customers, that is expanding its operation. We believe that the relations between brands, companies and customers are changing fundamentally, and there is a need for a new breed of marketeers that understand different platforms, know how to integrate them, and how to create value to for customers and brands/companies alike. We also believe that there are new ways to communicate with customers, that doesn’t necessarily require buying expensive media.

If we work together, you will create and execute multi-platform digital and real life activities that challenge traditional advertising and PR industry.

If you’d like to apply – send us your CV. It can be video, images, or plain old paper. You can find us at Jobs AT pravdam.com or on Facebook (Kfir Pravda)