Lesson for United: an Ounce of Prevention . . .

I’m kind of pissed off at United Airlines because they took my premier status away despite my long and heavy history (and lots of FF miles) with them. That’s my personal angle and — I must be honest — partial motivation for this post. But more abstractly this is a great example of the power of social media and how it’s tripping up “old school” companies, like United, left and right.

This story is about United baggage handlers who damaged some guitars and then refused to acknowledge responsibility. The whole episode is nicely laid out by Nielsen on the power of UGC and perils of ignoring consumer complaints. In a nutshell:

• Musician Dave Carroll and his band saw their guitars being abused by baggage handlers at Chicago O’Hare and complained
• United did nothing
• Carroll wrote a song (“United Breaks Guitars”) and produced a related music video and posted it on YouTube:

Millions of people have seen it and it now ranks for the query “united airlines.”

Nielsen offers a lengthy and thoughtful analysis of the events and impact that I won’t duplicate.

Clearly the front line and supervisory CSRs at United don’t have perspective and were mindlessly carrying out company policy in stonewalling Carroll. This video and the subsequent news coverage in major media outlets has damaged United in intangible ways. United’s brand and goodwill have been diminished if only temporarily as an airline that’s negligent and indifferent to customers. There’s a hard-to-determine yet real dollar value associated with that damage — at a minimum think of the corporate PR resources that have to go into combating this.

It’s an example of how brands and companies that deal with consumers must train and equip their CSRs differently and in fact empower lower-level people to address the facts and circumstances in front of them rather than simply using them as gatekeepers to try and get rid of annoying customer complaints. If there had been a sincere investigation and an offer of payment to replace the guitars the song (with others to come) would not have been written and the bad PR (and search results) would not have happened. As they say, an ounce of prevention . . .

Foursquare and the LBS Biz Model

TechCrunch offers a thoughtful post about some clever and spontaneous promotional uses of local-mobile social network/game Foursquare by local bars and clubs (discounts/coupons):

Plenty of others (including Google) are working on similar ideas surrounding location-based coupons, but the Foursquare idea has different potential because it’s a more proactive use of location-based services. On one level, Foursquare is more of a game, and some people use it to obtain a high score and get badges (for checking in certain places). That’s different from being in a place like a grocery store because you’re shopping as you normally would, and seeing a coupon pop up.

Foursquare, for those unfamiilar with it, rose from the ashes of Dodgeball, an early location-based social network that Google acquired, allowed to languish and then eventually shuttered. Google Latitude is a successor to Dodgeball in some respects.

Foursquare is clever and has the potential to be a “cult-like” hit with a select demographic group (read: college and early 20s) that goes out a lot, is intensely social in groups and has time on its hands. But because of the investment of time required and the initial complexity of learning how to “play,” it’s not a candidate for broad adoption and usage. That also limits its ability to make money from advertisers as well.

However all that may be just fine for Foursquare and may lead to brand sponsorships as well as local business promotions by bars, clubs and selected restaurants that cater to Foursquare’s users and audience. It’s very reminiscent of the now defunct online network MingleNow.

On the Twitter Documents Controversy

I haven’t really written anything about the leaked/stolen Twitter documents (“Twittergate”) that were obtained by TechCrunch. But now that they’re being disclosed, there’s lots of interesting stuff in there about competitors, business model, product vision, potential revenues and other things.

• Danny Sullivan has written a post about the Twitter suggested users list; the Twitterati, the Twitter “Who’s Who”
• Matt McGee summarizes some of the internal competitive discussions about Google, Microsoft and Facebook (e.g., “how Facebook could kill us”)
• TechCrunch offers a wide ranging discussion of Twitter’s ambitions (“to be the pulse of the planet”) and exposes a bunch of the memos that Matt discusses in his post

This is all pretty embarrassing and awkward for Twitter but reveals the company as aggressive, disciplined and paranoid (to some degree).

Fascinating stuff for those who are interested to dig into it.

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Update: Danny’s post was independent of the disclosed internal Twitter docs, based on his own research he informs me.

Update 2: Todd Leiser points to a very good overview and summary of the Twitter docs at SAI.

Pennysaver’s Viral Campaign Boosts Print

Pennysaver, the print classifieds and coupons publisher, produced a parody of the MC Hammer “U can’t touch this” video (“Savertime“) to promote itself. It hopes the video will go viral and it’s also part of a contest the company is doing.

In addition Pennysaver is using Twitter and Facebook — and using Twitter to build its Facebook fans:

You may find the video corny, but I think it’s pretty effective and will go viral for the company. Some people will clearly like it if not everyone does.

Pennysaver has a site but is largely a traditional media/ads publisher. These viral/social media efforts are creative and, to some degree, help “sexify” the print publication and invigorate/reinvigorate the brand as a whole.

Aloqa Goes Live on Android Platform

Don’t call it an LBS service,” Sanjeev Agrawal, CEO of Aloqa, told me when I spoke to him a couple weeks ago. He prefers the term “context-aware.” Aloqa officially launched yesterday on the Android platform and announced $1.5 million in funding. Other smartphone platforms are coming soon. Aloqa currently works in the US and Germany.

Agrawal, preparing for his presentation at yesterday’s Mobile Beat conference, was trying to come up with a quick way to describe Aloqa. The metaphor he often uses is cable TV channels or an “app store within an app store.” I didn’t stay to see his presentation, but it must have been successful because the company won the “people’s choice” award at the show.

Aloqa has a menu of content modules or channels, which can be “owned” or developed third parties. (There will be an SDK soon.) This is almost identical to what MapQuest has done on the PC with its Local site.

The rest of this post is over at LMS.

Magna: SMB Ad Spend $50B+, Local $3.5B

Below are some charts I pulled from Magna’s July 2009 ad forecast. It covers a broad range of media and offers some local and small business estimates as well:

Because there isn’t much narrative or discussion in the slides it’s hard to be sure of definitions and what’s in or what’s out.

More from Nielsen on Media Trust

There much more data from Nielsen on consumer trust and attitudes toward media and advertising than what I published before. Below are some tables and charts from the larger report (a veritable treasure trove of information):

Much maligned email is most trusted; this also augurs well for SMS opt-in campaigns notwithstanding the low ranking of text ads in the first graphic above.

Despite ambivalence, consumers apparently recognize that advertising has a role to play in subsidizing costs, creating jobs and other economic benefits:

This is difficult to read, I realize. But you can get this report yourselves here.

Google SMB Event an Interesting Model

I was at the Google Favorite Places event yesterday in San Francisco. I’ve written up my experience on SEL.

It was ostensibly about the Favorite Places announcement but it was largely about explaining to SMBs (apparently 200 in the room) why they should claim and enhance their profiles on Google Maps through the Local Business Center. Citysearch and Yelp were also there.

Yelp encouraged business owners to “join the conversation,” while Citysearch was selling its reach and reporting (“we’ll tell you how many calls you received”).

The really difficult thing to gauge was whether the pretty basic information being presented was appropriately calibrated to the audience’s sophistication level. Among a couple of the SMB attendees — who were invited based on their inclusion in the Favorite Places lists compiled by celebrities — I spoke to were two people from the St. Regis hotel, part of the Starwood chain. They said they were there largely to get a better understanding of AdWords, which is managed on their behalf out of a Seattle office.

Even though they’re part of a major hotel chain they saw themselves as a local business trying to get attention within their organization and from local consumers in specific markets.

I could imagine Google doing a series of these events around the US, especially in “secondary” markets where they would be likely to get considerable media play. From talking to several Google execs and employees there it was fairly clear to me that this was a kind of experiment. They said that they would follow up with the attendees and evaluate the event accordingly.

I also asked how the Google LBC Dashboard was being received and I was told that it was being very favorably received. I said “what about call tracking?” (which it doesn’t offer) and got a non-committal response but that’s probably being looked at.

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Related: In reaction to a new PR campaign around Maps, Mike B says:

It is fine to educate and promote your products in an easy listening style but don’t try to tell folks that “we hear you” as a solution to real, concrete bug fixes and human support.

Local.com Announces Traffic, Results

Last week Local.com put out a release about its growing traffic:

The company reached record search traffic of 63 million monthly unique visitors (MUVs) on the Local.com site and network during the second quarter of 2009, up 5% from 60 million MUVs during the first quarter of 2009, and up 32% from 48 million MUVs during the second quarter of 2008.

Organic traffic also reached an all-time high, exceeding 29 million monthly unique visitors on the Local.com site and network during the second quarter of 2009, up 6% from 27 million during the first quarter of 2009, and up 57% from 18 million during the second quarter of 2008.

And today the company released preliminary Q2 financials:

Local.com Corporation, a leading local search site and network, today announced that based on unaudited preliminary results for the three months ended June 30, 2009, the company expects revenue to be between $13.4 and $13.7 million, exceeding the high end of its prior guidance of $13.2 million.

My understanding is that roughly half the traffic is organic and half is paid. It’s not clear what percentage the network contributes.

Never Trust ‘The Cloud’?

First the Twitter docs controversy: A hacker sent hundreds of allegedly authentic internal Twitter docs to TechCrunch. There was much sensitive information in there. Some of it TechCrunch is going to expose, some of it the site has chosen not to.

Beyond the ethical questions surrounding TechCrunch’s potential disclosure of the docs, there is the issue of the security of the cloud. Apparently the docs were downloaded from Google Apps.

What it shows is that cloud security is not ready for prime time.

Fake Reviews Purveyor Settles Suit for $300K

Thanks to Mike Blumethal for pointing me to this story of a settlement between a plastic surgeon and the NY Attorney General for the posting of false positive reviews:

Attorney General Andrew M. Cuomo today announced a settlement with cosmetic surgery outfit Lifestyle Lift over the publishing of fake consumer reviews on the Internet.

Under the settlement, Lifestyle Lift will stop publishing anonymous positive reviews about the company to Internet message boards and other Web sites, and will pay $300,000 in penalties and costs to the State of New York. The case is believed to be the first in the nation aimed at combating “astroturfing,” a growing problem on the Internet.

Lifestyle Lift employees published positive reviews and comments about the company to trick Web-browsing consumers into believing that satisfied customers were posting their own stories. These tactics constitute deceptive commercial practices, false advertising, and fraudulent and illegal conduct under New York and federal consumer protection law. The settlement marks a strike against the growing practice of “astroturfing,” in which employees pose as independent consumers to post positive reviews and commentary to Web sites and Internet message boards about their own company.

A few thoughts:

• This practice and case illustrate the high-stakes that now accompany online reviews
• Automated policing mechanisms will need to develop to combat it
• Selected sites will become more trusted (and trade on the authenticity of their reviews) if this practice becomes more widespread
• This settlement will hopefully “chill” astroturfing

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Related: Andrew Shotland weighs in on the issue with his own irreverent yet practical take.

Compensating Content Creators: What’s Fair?

A new Columbia Journalism Review opinion piece argues persuasively (in my view) that Google “owes” something to traditional journalism and news organizations. Google, typically, is a stand-in for “the internet” in these discussions. However the notion of “responsibility” to publishers is unpopular among bloggers and Internet denizens more generally.

I tend to fault news organizations for not being faster, smarter and more creative in their online efforts. It’s also the case that the Internet as a publishing and distribution platform has disrupted traditional media models across the board. And pointing the finger at others, such as Google, tends to obscure the fault or responsibility that publishers should accept for their own missteps, failures and omissions.

Having said all that, I found this discussion in the article pretty compelling:

On Saturday afternoon, February 7, 2009, SI.com, the Web site of Sports Illustrated, broke a huge story: Alex Rodriguez, the mega-rich Yankees star, had taken performance-enhancing drugs while playing for the Texas Rangers. Sports Illustrated released the story on its Web site rather than in the magazine, according to the editors involved, in an effort to enhance SI.com’s standing as a destination for fans increasingly conditioned to getting sports news online. Within hours the story was everywhere, but if you went through Google to find it, what you likely got instead were the pickups that appeared elsewhere, summaries or even rewrites, with attribution. Most galling was that The Huffington Post’s use of an Associated Press version of SI’s report was initially tops on Google, which meant that it, and not SI.com, tended to be the place readers clicking through to get the gist of the breaking scandal would land.

The rest of this post is at SEL.

Borrell: 20% of Social Nets Ad Dollars Local

While I was gone Borrell put out an ad spending projection that contends social networks will see 20% of their ad dollars come from the local (read: SMB) market:

We just did an assessment of advertising placed on social networking sites and were surprised to find that nearly 20% of all ad spending is by local businesses. Our assumption going into this research was that commercials on social networks were almost purely national. We’re estimating that local advertisers will account for about $641 million of nearly $3.3 billion this year trying to reach consumers via these sites.

Borrell’s list of social networking sites is long but there are only three sites that matter in the big picture: Facebook, Twitter (no ads now) and MySpace (although MySpace is fading). Maybe AOL will do something with Bebo and local that is interesting in the future, given that AOL is making a renewed effort in local. There may be other isolated sites that matter here and there for specific industries or verticals.

Problems/issues/questions with this estimate:

• It’s extrapolated from a small base
• Most of the “action” on social networks among SMBs cannot be considered “advertising” (e.g., Facebook profiles, fan pages)
• What’s a “social network”? We all know the top sites but definitions get murky when one gets farther “down” the ladder.

I agree that there will continue to be lots of focus and energy among SMBs directed to social networking sites — Twitter and Facebook in particular. The challenge for these sites is how to build functionality that both benefits SMBs and can generate revenue. The various flavors of “advertising” on Facebook are not as useful as the free tools. And Twitter effectively has no ads.

There is, however, a substantial opportunity for third parties, SEM firms and directory publishers in particular to add Twitter and Facebook tools (and reach) into their product set to add value to what they’re providing to advertisers. Some are contemplating or already doing versions of this. Agendize, for example, does extends directory publisher reach with its toolset.

Source Borrell Associates (n=118)

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Related: From MediaPost . . . Most of the 2008 revenue forecasts proved to be terribly wrong:

A survey of eight revenue forecasts issued between June 2007 and December 2008 (from Veronis Suhler Stevenson, Jupiter Research, the Kelsey Group, Lehman Bros., Magna, eMarketer, J.P. Morgan, and ZenithOptimedia) reveals that, on average, the crystal ball for Internet advertising revenue growth in 2008 was about 100% higher than the actual growth rate, with an average prediction of 20% versus actual growth of just 10%, according to the Interactive Advertising Bureau. Midway through 2009, it seems likely the forecasts will be even further off. On average the analysts predicted 17.5% growth in Internet revenues, but the first quarter actually saw negative growth with a -5% drop. True, the rest of the year could see a recovery – but to yield an annual growth rate of 17.5% Internet revenues would have to grow an average 25% in the second, third, and fourth quarters.

Local Search Summit Delayed

I was informed this past Thursday that the Local Search Summit would be delayed until the time of SES San Jose (I believe Thursday of that week). More information later as I get it.

Taking a Few Days Off

I’m going to “get outta Dodge” (as some would say) for a few days to avert what might otherwise turn into a psychotic break with reality. I’ve always liked that phrase.

No blogging for me here until sometime Tues.

Oodle Integrates Twitter Distribution (and Search)

Oodle has integrated Twitter distribution into its network. According to the Oodle Blog:

Now you can post your listing on Oodle and automatically share it with friends on Twitter (as well as your friends on Facebook and MySpace). Listings are tweeted into your Twitter stream where your followers see it immediately.

Users can also follow or search for Oodle listings on Twitter.

I spoke with Oodle CEO Craig Donato yesterday briefly. He told me the Facebook integration was going well and that traffic was growing. He said Oodle’s social media integrations, including Twitter, are about trying to “enable conversations” around listings. Donato means lots of things by that, including sharing, investigation of listings and those associated with them, among other things.

Oodle has built a pretty massive network of publishers and “powered by” sites including Wal-Mart, Facebook, MySpace, AOL and many others.

Others are using Twitter as a distribution vehicle or traffic driver as well, including MerchantCircle (for coupons and deals), Scoot in the UK and a range of others. Soon it will be mandatory to have some kind of “Twitter strategy.”

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But wait there’s more: Oodle’s success will likely not hurt Craigslist. I characterized the Oodle-Facebook integration as the first bona fide Craigslist challenger. But CL is the 18th most popular site on the US Internet with somewhere around 40 million uniques. It now appears to be the “Google of classifieds” in the sense that its market position seems unassailable.

MobileBeat Is Next Week

The MobileBeat 2009 conference is next Thursday (7/16) in San Francisco at the Parc 55 Hotel. It’s 12 hours of mobile goodness. But you say mobile doesn’t apply to you?

At a time when 1 out of every 7 minutes spent with media is already on a mobile device, everyone has to take mobile seriously as a platform.

It’s going to be a terrific event with a great lineup of speakers. They include folks from Google, Palm, Yahoo Mobile, Motorola, Nokia, and Microsoft. There’s also a startup competition at the end of the event, which should be pretty interesting. In the Lo-Mo segment, I just spoke to startup Aloqa this morning. They’ll be there. The complete agenda is here.

For a discount you can sign up here and enter the code “mb09opusre.” It’s equal to the early-bird rate ($450).

Google Hosting SF ‘Celebration’ for SMBs

Matt McGee posts at SEL about an event Google organized for SMBs in San Francisco to introduce them to the local business center and AdWords.  I’m guessing it’s a trial for other, similar events around the country. It’s being held next week, on July 15.

The copy for the announcement reads:

Google will host San Francisco business owners at City Hall for an afternoon of celebration and educational opportunity . . .

Google employees will be on hand to help you learn how to make the most of Google’s free business solutions and AdWords online advertising program, and we’ll distribute coupons for free AdWords advertising.

Google has tried many such SMB instructional events, from Google U (back in 2002) to ongoing “success seminars” (AdWords training sessions) still going on at various locations. These, and other efforts, such as the Google Online Marketing Challenge, are part of Google’s outreach to the SMB market.

Matt then goes on in the rest of his post to discuss complaints from existing SMB customers and advertisers about Google’s uneven customer service. His headline is Google Pitches New Small Business Customers, Ignores Existing Ones.

Online Reviews Trusted Most After WOM

According to a global Nielsen survey (25K online users in 50 countries), people trust their friends and then user-generated reviews and consumer opinions. Here’s the hierarchy of trust:

Very strangely “brand websites” comes in third before newspaper editorial content.

‘Look and Feel’ Makes a Comeback

RH Donnelley and Innovectra announced a deal for Dexpages, a searchable, clickable “look and feel” online version of the print directory. It can be downloaded or browsed online:

Each directory maintains the look of a print directory on a computer screen, and contains all of the information found in print versions, including local business and white pages listings, community information, and more. In addition, Dex Pages enables keyword search and displays hotlinks to email and website addresses, making it easy for consumers to contact businesses directly or discover more information on the business with a single click.

Currently available in the 14 states where R.H. Donnelley publishes directories for Qwest, Dex Pages will expand by the end of the year to include areas featuring the EMBARQ(R) Yellow Pages brought to you by Dex and AT&T Real Yellow Pages published by Dex. Once this is complete all directories published by R.H. Donnelley will be available on Dex Pages. Each virtual directory will be hosted by Innovectra using its ActivDirectory software.

Other publishers such as Idearc are doing this too. Look and feel lost out to search (search style presentation) in the early part of this decade but is now apparently making a comeback. Appealing to a segment of the audience that has moved online but still likes the familiar print layout and display ads. So publishers have “diversified” with print, online print look and feel, IYP/search, mobile apps/Web as sources of traffic for their advertisers.

What do you think about look and feel. Like it? Hate it?