Bebo Buyout Rant – $850 Million Dollar Buyout – Deja vu

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Come on guys, do we need to do this again? I am going to remind you all of a little quote from Einstein. “The Definition of Insanity is doing the same thing and expecting different results” Should we drive up valuations based off a trend and only all get caught with our pants down looking… Read more »

Come on guys, do we need to do this again? I am going to remind you all of a little quote from Einstein. “The Definition of Insanity is doing the same thing and expecting different results” Should we drive up valuations based off a trend and only all get caught with our pants down looking like a bunch of idiots for jumping on the bandwagon….again? Didn’t we already do this? When will we learn?

AOL’s recent purchase of Bebo, the teeny bobber website, for $850 million dollars (90 times revenue) was a knee-jerk fad buyout in some type of response to Microsoft’s recent investment into Facebook, valuing the that company more than Ford; 15 Billion Dollars.

This is ridiculous. The moment that Bebo or Facebook comes up with a revenue model to match their current valuation, they will lose their market share and someone else will just start up the next up and coming website and the Facebook/bebo/Myspace following will all leave and go there. We need to all remember that these companies do not have software that is unique or business-changing. They are banking that the kids that occupy the sites, whom hate big business, advertisements and all things corporate, will respond favorably to a revenue model. Facebook is already 0/1 with their advertising model when their community went ballistics over their Beacon platform.

What is next people? Are we going to start investing in grocery store delivery businesses with no revenue for $500 million dollars again as well?

Danny DeMichele

Stop worrying about yesterday – what does last month look like?

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Far too many times when we start working with clients on their internet marketing campaign are we asked by the client to send daily/weekly reports and give them our insight about each day. This could be one of the biggest problems we are faced with. Companies online have become obsessed with data to the point… Read more »

Far too many times when we start working with clients on their internet marketing campaign are we asked by the client to send daily/weekly reports and give them our insight about each day. This could be one of the biggest problems we are faced with.

Companies online have become obsessed with data to the point that they stopped looking at longer-term benefits of any given campaign. “What did yesterdays Google campaign yield for me yesterday?” “on Tuesday we got 73 orders, today only 52, should we shut the campaign off?”

The fact is, there are fluctuations online that no one can really point to. I call it the Conversion Chaos Theory. Although there is no evidence of what causes cycles in ecommerce, they are there. Sure, there are the obvious holiday/vacation/weekend cycles that most retailers see, but there is evidence of chaotic cycles that could be attributed to complete randomness.

I would say that although we recommend looking at daily spends to make sure something really crazy is not happening, do not knee jerk your campaigns every day (or week for that matter) as to see the whole picture you really need a longer term sampling size. I typically recommend 3-4 weeks minimum before making huge changes. Always remember, data from failing campaigns will teach you just as much or more than data from winning campaigns. So waiting the extra time even on a failing campaign will surely teach you even more about your online business model.

Superbowl Advertising – Dont forget about online

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Every year in the ad industry, there is always buzz around the Super Bowl. Next to the Oscars, it is the most popular commercial spot to purchase because only a fraction (under 2%) of people will record the event to watch later. In general, everyone sees it live and does not skip commercials as they… Read more »

Every year in the ad industry, there is always buzz around the Super Bowl. Next to the Oscars, it is the most popular commercial spot to purchase because only a fraction (under 2%) of people will record the event to watch later. In general, everyone sees it live and does not skip commercials as they actually look forward to seeing them! It is actually the only reason my wife will watch the Super Bowl. One of the major problems we have seen is that most companies want to get really clever with their ad, sometimes to the demise of the actual branding they would normally experience with a traditional, informative commercial.  The thing that I have never understood is the lack of online “support” these advertisers plan for online. They spend $2.5 million on a commercial spot, but have almost zero visibility when it comes to relaying that message online. Let me give you an example:1. John Fan is sitting on his couch. It’s the 4th quarter, 1 minute 30 seconds left, score is tied 21/21. The Pats call a time out.
2. Commercial time!

Toyota has a commercial for the new oxygen-fueled SUV. It shows 4 girls in bikinis, driving down coast highway with a little tag line at the end of stating “you think it looks good. That’s nothing, it is fueled by oxygen.” and ends with a site promo: “Come to www.toyota-oxygen-fueled-SUV.com” too learn more.
3. John Fan thinks “holy $h^t” I have to learn more about this, but I better wait until the game is over.
4. The game comes back on, the patriots miss a 22 yard field goal and the Giants win in overtime on a kick off return.
5. John Fan is devastated. After awaking from drunken nap, he goes to his computer to read more about that cool oxygen-fueled SUV.
6. He forgets the website URL. No problem, he thinks, Google will find it.
7. Types in ‘New

Toyota’
8. Results for Camry’s pop up everywhere.
9. He types in ‘Oxygen Fueled SUV’.
10. Green-themed websites pop up everywhere.
11. He gets bored, turns off his monitor, and takes a nap.
12.

Toyota just lost John Fan.The pathetic part is that if

Toyota would have spent a lousy $10-$20k to backup their $2.5 million dollar Super Bowl ad, it would have made it so much more effective.Super Bowl advertisers! There is still time to optimize your ad dollars…give your local search marketing firm a call.