[It's a perfect day here in San Diego at Graphing Social Patterns, we're right on the waterfront, but us geeks, well we tweeted, blogged, and talked in a dark room]
Most of the presentations this morning have been very developer focused, I’m covering Graphing Social from the Web Strategists’ perspective: Web decision makers in corporate.
Rodney Rumford gave a Facebook Marketing 101 presentations and explains how businesses can use widgets to reach customers. Facebook gives you multiple ways to reach customers, and with them spending 20 minutes per day, the attention is there.
In the presentation from BJ Fogg who co-ran the Facebook class at Stanford, they developed applications, that they estimated totaled $500,000 in revenue from the students efforts in advertising. They give out a list of learnings on what made them successful, often it included being flexible, quickly iterating, not listening to individual opinions or getting approvals, just launching them, and experimentation. It was very clear to me that that behavior is the opposite of large brands, who want safety, low risk, and pre-written plans.
[Successful applications were experimental, embraced risk, and quickly iterated --everything big brands will struggle with]
Rodney gave the example of the where I’ve been map, and suggested that brand managers should consider sponsoring existing successful apps, rather than create their own. Rodney suggested that advertising rates were disappointing yet, suggested that interactive marketing and social ads gave more opportunity. First, define success, lay out metrics, use a multi-pronged approach (there are many different tools to use).
Rodney suggests that one of the key challenges is with the decision making process:
“Most of the people (at big corporations) who are making the decisions for Facebook are 45 or older, and are not immersed in Facebook”
For success, one should consider: 1) Outsourcing development to those that get it, such as an a successful widget development company, or 2) lean on someone in your own team who really understands this space. While strategy remains, social networking marketing requires a different mindset, approach, and use of tools.
Various pics from the event
Before you invest time and money in a widget strategy, you better know the challenges. This applies to VCs, Web Strategists, Developers, and even Social network companies
An Objective View
In this blog, I strive to provide a balanced viewpoint of both the benefits and challenges of a web strategy, it’s easy for us to become over-hyped and then fall right into the pit of over exuberance. (See other posts tagged Challenge)
I’m moderating quite a few panels with widget developers (last week at Stanford, next week at Graphing Social, and in a few weeks at Ad:Tech) so I’ll be using many of these challenges to hold the vendors to their claims.
First, a few parameters:
Update: This list of challenges mainly applies to widgets within Social Networks, although many of the challenges afflict mobile, desktop and blog widgets.
Widgets are ‘mini-applications’ that can be embedded on other containers (such as social networks like Facebook, MySpace, Bebo, LinkedIn, and whoever decides to join the movement) The thing is, desktop widgets have been around for some time, so this really isn’t anything new, but for the purpose of this post, I’m just going to keep those on social networks in scope.
In regards to terminology, I’m just going to use widgets as a blanket term to also include “applications” and “canvas pages” terms that developers user on Facebook’s F8 platform. I’ll clarify that on another post in the future.
The Many Challenges of Widgets:
Each of the following hurdles can be overcome, but first, let’s identify them.
Difficult to Monetize
First and foremost, this has been the biggest challenge. For some widget developers, the money has come from investors or VCs on Sand Hill road. Secondly, I’m hearing that the CPI plague (see below) is becoming more common, and then lastly, advertising is not an effective way to monetize in social networks (read this for more).
Widget developers are mostly experimental, they are throwing gangly Spaghetti, Pasta, Rigatoni, and Jeremici (I just made that up) against the wall to see what will stick. In most cases, most of the half cooked pasta falls down from low users adoption, leaving a sticky residue of messy profile pages.
Overcrowding profile page
Have you seen my profile page on Facebook? It’s a mess, and with so much noise, who can compete? With there being thousands of widgets, only a few can survive on my profile page (I know there is tabbed segmentation) but really, how many do we need?
Low Barriers to Entry
A challenge for every web market, is that there are few ways to differentiate, and it’s easy for a young Russian developer or a Stanford student, or a team of Chinese engineers to quickly get in the game.
Metrics and Analytics Inconsistencies
Hardly anyone is measuring the success of their widgets in the same way, do we measure on install, activity, views, traffic, or clicks? As a result, other than Appsaholic, there’s very few industry ways to measure success.
Sadly, I learned from a panel I managed that some of the most successful apps were the one that leaned on the social graph, no not the one that we all dream about, but in the context of email spam. Many containers are clamping down on this, as it’s best to preserve the user experience, but this could continue to be an issue.
Bastardization: Cost per Installation (CPI)
To me, this looks like one of the worst in our industry, to me, this is like ‘printing money’. Did you know some of the top developer companies sell to other developers the chance to let new widgets piggy back off successful ones by promoting them. The developer can then charge for cost per install.
Disposable and low value
Rodney Rumford first mentioned this term to me, he was describing that many widgets are simply not used more than once. These glamor widgets provide one time entertainment, or are used once and never reused –except for removing from ones profile page.
Recycled clones offer little uniqueness
Perhaps the worst plague is the “attack of the clones” in many cases, the code from widgets are created by one developer,
stolen (I mean crowdsourced or collaborated) slightly modified or rebranded and then republished.
I’m trying to think of a widget that provides business utility, or one that improves my life other than casual communications or entertainment. Reminiscent of the web in the mid 90s, we’ve yet to see the business value.
Hard to build successfully
Specialized skill set are common among the developers, most traditional interactive firms, and most companies don’t have the skills or experience to create a widget. It’s a different game with a different mindset, the same strategies often don’t apply.
Multiple APIs strain developers
Most platforms or containers are offering their own API, although most are touting they are OpenSocial compliant (as I write this, OpenSocial is
not public, it is but in beta but should be soon) yet we’ve got to wonder is it too late for there to be a common industry API if it’s already fragmented? I spoke to the Evangelist of MindKey last night and he suggested that each platform has unique APIs (like news feed APIs) that the other doesn’t share –it’s already fragmented.
Ever changing platform APIs requires attentive team
When I hosted the widget roundtable, it became very clear that the APIs on platforms are quickly changing, and sometimes without notice. For the agile developer company, they’ll be able to quickly morph with their full time resources, but for the Interactive Firm or corporate web team, they’ll likely be too slow.
Pricing may vary, lack of standards
I have the privilege of being one of the few people in the world that gets to talk to the widget developers and find out what they are charging. In many cases they don’t know what to charge (as they have strong technical skills, but are just ramping up on the business side, and they are undercharging) This will clean up this year, and we’ll start to see some benchmarks.
Poor User Experience
Dennis McDonald (via comments) suggests that the usability for widgets is often poor. With there being little standardization on the inteaction design, I’ll agree, he states: “It’s hard enough to keep track of multiple incoming data streams representing different people, sources, relationships, keywords, etc. When you try to cram too much though a widget you have a real usability problem because of the variety.”
Pravda (via comments) suggests that some widgets have poor performance, and thereby causes a disrupted experience. Since widgets are hosted on third party servers, some laggards can hinder the rest of the social network experience, he states: “This is because they require additional HTTP request, and in some cases, this request delays the rest of the page. This is the reason that I am not using Meebo widget in my blog”
Lack of Brand Control
Len Kendall (via comments) suggests that some brands may be concerned where their sponsored widget may appear. In many traditional advertising deals, Coke will never want it’s advertisement near Pepsi, but with widgets, that’s unavoidable.
Add your own in comments
What other challenges of widgets did I miss? Please leave a comment and credit and link to you.
Caveat: While I’m highlighting the challenges, it doesn’t mean they can’t be overcome, and it most cases, the value is higher than the challenge. I’m just suggesting, we shouldn’t only look at the beautiful side, but set yourself up for success by knowing what you’re in store for.
I could write a solution or a fix for all of these challenges, but that’s a post for another time, or one I’d be happy to answer for clients.
In my role, I get briefed by companies that I cover in my space (social networks, widgets, and related products). If I feel the speaker is strong, and can deliver a succinct message that’s helpful to my audience, I’ll do a video. Ro Choy of RockYou (warning: auto playing music) clearly meets these requirements.
If you’re not familiar, RockYou is one of the leaders in what I call the widget network category. They create hundreds of widgets that were initially launched on blogs, then moved to Facebook, and will now be deployed on other social networks that allow development (Bebo, MySpace, etc). Between RockYou and their competitor Slide, they account for 8/10 top applications on Facebook (as I learned from Ren last night)
In this video, you’ll learn about his methodology (which I even discussed last night at the panel as a best practice). He discusses how web strategists should approach widget creation.
How the Web Strategist should approach Widgets
Level 1: Branding: Applications, like Microsites
Level 2: Interaction: Include the brand as part of the experience
Level 3: Custom: Build your own application
Pitfalls to watch out for
They’ve an office location that I’m familiar with, in downtown San Mateo across from central park where I used to play as a very young web strategist. (map)
(Left: I met and interviewed MySpace’s team Will and Jim)
I just got back from the brand spanking new SF MySpace office, an event tonight that was catered to the new developer platform which they announced today. This post isn’t aimed at developers, but at the Web Strategist (web decision maker) here’s what you need to know:
MySpace opens third party developer platform
MySpace announced a developer platform so third party developers can create applications on top of their existing commmunity. This is released on time, and is a competitive move to Facebook’s application platform. I’ve published stats and demographics about MySpace (and Facebook here). Over the next 30 days, developers will get to play in the ‘Sandbox’ (the theme for tonight’s party).
Here’s what to expect:
After watching this space, talking to MySpace techical staff, and talking to many developers at the event, here’s my predictions and insights.
1) MySpace builds strategic relationship with widget developer community
MySpace’s new SF office is a great foothold into Silicon Valley, in particular, to the widget developer community. Most of the widget network developers are located in this area, and by buidling relationships with them, there’s an opportunity they’ll launch their widgets on their container, fueling the next generation of MySpace. The schwag (pics below) really catered to the developer: a backpack full of shirts, flip video player, and a few toys for the beach. (for the sandbox)
2) Unlike Facebook, Developer and MySpace will partner and monetize
Unlike Facebook, it’s expected that developers will have direct access to monetize utilizing MySpace’s advertising tools. Although it wasn’t formally announced, expect hyper targeting, and other monetization opportunities to be available to developers.
3) MySpace respects Privacy
MySpace, a later adopter to this movement, let Facebook make it’s mistakes (newspage and Beacon) and will not suffer from the same issues. Expect Myspace to play it safe, and play it right, leaning on the mistakes from Facebook.
4) While not fully developed, expect platform to slowly evolve
It was very clear (I talked to many developers in the room) and they were all waiting to see what the platform was like, as very little was released, miany documentation. I asked during the Q&A session when all the APIs will be available, and they said “tonight…(looking over at colleagues) right?” Laughter from crowd erupted. There will be three APIs released each with different abilities. Also, applications can display in 5 different locations within MySpace, including a private area for the user to see the application without anyone else seeing it.
5) Widgets on MySpace react different than other Social Networks
Even if widgets can be easily ported over from Facebook to Myspace don’t expect them to work the same. Demographics (who they are), Psyhographics (their emotional drivers), and Technographics (how they use technology) will all be different. Expect very few of the successful applications in Facebook to perform the same way in MySpace.
6) MySpace, Facebook, and Bebo coexist
I can’t tell you how many times I’m asked “is Facebook a Myspace killer?” the answer is no, they are different tools from different audiences. They will coexist.
What it means:
Expect a lot of trial and error development to occur, this is really and experimentation stage for the next 3 months. The platform will ilkely have a lot of tweaking and expect a lot of experimentation from the developer community. In the long run, MySpace will be able to successfully monetize, developers will profit, and brands will start to get involved. Hopefully, the user experience will respect the wishes of the users, and it will be a win for all.
Recommendations to the Web Strategist
Unless you’re already a successful widget developer you should not engage, instead you should Wait and Watch, and see what applications work, and what won’t. Then, consider contacting those developer networks to rebrand successful applications, or go a step further and create interactive of social campaigns partnering with them, and lastly, developing your own widget.
Update: Thanks Steve Ames for the assistance, he spotted a few errors in text, more from Justin Smith.
A Widget Case Study
Yesterday, I gave a teleconference on Facebook as a ready-made marketing program. I gave a few examples of success, and the audience was hungry for success metrics and numbers. One of the case examples was about rebranding an application/widget in this case, Rock You’s vampire application.
Sony rebrands popular Vampires Widget with 30 Days Night, upcoming Vampire movie
Vampires, which you may already know as the RPG where members bite each other to receive points (and duel) was already popular with over 3 million installs in Facebook.
Sony pictures, the parent company of the very scary 30 Days Night vampire horror film rebranded the existing application, and launched a sweepstakes contest to generate registrations and glean intelligence. The grand prizes? 4 wheel ATVs and $1500.
Specifically, they placed banner ads on the rebranded vampire applications which promoted the movie (one could assume that those who opt-in for the vampires application would also like a vampire movie) promoting the sweekstakes.
The measurable results?
The campaign was only live for 3 weeks, and there were 59,100 sweepstakes entries. (success was deemed at 10k, this clearly moved beyond that)
The visits (I don’t know if they were unique or repeated) were 11,642,051 for the bite page, and 17,652,567 for the stats page (I believe these are part of the interactive experience of the game.
Sony was happy, it exceeded expectations, and users of the application weren’t over branded.
RockYou asked me to keep the price confidential, but based upon the results they told me, I suggested they double the rates, this is despite what Mashable reports on.
Fishing where the fish are: Sony figured out where the already existing community was (remember to fish where the fish are) and rather than trying to rebuild something completely by scratch, they leveraged an existing successful application.
Rely on specialists for new arenas: In my many briefings with vendors and clients, specialized firms often provide something a general interactive firm or corporate web marketing team can’t. They have experience, know their area, and in this case, they knew to rely on someone that already knew Facebook.
Compliment the existing user experience: Sony didn’t beat the 3 million existing users with heavy advertising (and I’m sure RockYou wouldn’t have let them) over the head, instead offered value by giving away prizes, and tied in a movie that already existed.
What could have been better?
In my opinion, it would be great if:
The campaign lasted longer than 3 weeks.
Rather than simply embedded, Sony could sponsor elements from the movie and integrate within the game. (vampires could fight at different scenes from the movie, key characters from the movie could become non-player characters, etc). They already have a multi-player game that could have tied in.
A spin off game could have emerged just around the game, where members could give virtual gifts to each relating to the movie, then cross-selling other sony products and merchandise.
Also realize there are very few applications in Facebook that are this popular, don’t expect these type of results to occur every time.
Widget Network Developers
Looking bigger, RockYou isn’t the only vendor doing this type of work, also see Slide, Clearspring, Gigya, and a bunch of others. If you’re in the space, feel free to leave a comment below adding to the conversation.
For those Forrester clients who attended the webinar, I hope that clears up the question (as I promised to find the answer), and thanks to Ro Choy and team of Rock You for the details. If you need to know more, read this weekly digest of the social network industry, or see all posts tagged Facebook.
Why Web Strategists should consider widgets
Expect widgets to act like a network, the span over many different containers like social networks, websites, and blogs. Since widgets are opt-in by the publisher or social network member, it’s a great way to track who’s actually interested in the content. As a result, the opportunity for more sophisticated marketing and advertising moves from carpet bombing to opt-in nearly GPS radar-like accuracy.
First, understand the distributed web strategy
Need to get up to speed on this, start with my primer on web marketing is distributed, not on two domains alone, followed up by a former CMOs perspective on the distributed web. Getting users to come to your corporate website is not the only goal, savvy fisherman fish where the fish are.
New players as widget networks emerge
I’m closely watching the widget industry with colleague Charlene Li. This time last year, there were no widgets in Facebook, and now there are over 13,000. I recognize that this is a growth market Widget ad revenue was estimated at about $20 million in 2007, or about one-thousandth of Internet advertising as a whole. According to the new comScore data for November, Slide claimed almost 144 million unique viewers, for a 16% market share, and RockYou claimed a 11.7% share, with 104 million individual viewers. In July, Slide had 130 million individual users, or a 15% share, while RockYou boasted 96 million users, or 11.1% of the total. (stats via MSNBC)
Spending low, but expect growth
According to the data (from Comscore) that 6% of internet advertising dollars were being spent on social networks, and only a fraction currently is spent on widgets. Expect that to grow in both camps. Widget networks aren’t limited to social networks alone, in many cases, they can be repurposed for mobile devices as well as standalone embeds on websites and blogs.
Measurement key as dollars shift
The article states that some of the growth is capped due to lack of measurement (a good reason why I created this list of widget measurement companies). You’ll need to measure to show success, as well as make in-flight course corrections in near real time.
Expectations in 2008
So, expect widget networks like Slide, Rockyou, Widgetbox, Watercooler, and many many others, to become like syndicated networks, offer self-serve advertising, begin to offer metrics, and offer unique co-branded, and co-sponsored marketing campaigns to brands. Two of these networks will likely be acquired by large media or internet companies in the next 11 months.
Case Study: Forbes Widgets
Here’s a case of a company letting go to the distributed web, I just ran into the Forbes site, and saw they had a full page devoted to widgets, that let it’s content, and brand spread of it’s site. Interesting that it’s sponsor, in this case Visa, goes with it.
What you should do
First, determine if your community and marketplace is using widgets, do research. If so, seek one of those widget networks, and trail an advertising campaign that will match to your right community. Don’t try to recreate a widget, leave it to the experts, and likely, your interactive firm won’t do it well, these are very specialized products. Rather than have the widget network vendor recreate a new widget, leverage an existing one by sponsorship, rebranding, or integrating with a unique marketing campaign.
I’m watching more closely the movement within the widget industry, it’s growing quickly, and we expect 2008 to have some serious growth from this market. Expect widget advertising networks to appear this year, and as a result, the need to measure and watch this distributed industry is important. Here’s a list of companies that measure widget network growth.
How is widget measurement different than traditional web analytics? Widgets spread (velocity = distance/time) over networks, and are distributed. Users will embed them, interact with them and share with them with others. Also, you can identify unique nodes where applications have spread, these are influencer nodes, and should be treated with extra care. When deploying your widget, since it’s managed by a host, demand that you’ve access to metrics so you can see how it performs, and more importantly, who it works well with.
List of companies that provide widget measurement or metrics
Appsaholic from Social Media
“SocialMedia developed Appsaholic, an analytics suite that allows you to track the success of your application and see how it compares to others”
“Clearspring is the leading provider of cross-platform widget services. Our goal is to make it easy to use content and services from across the Internet to weave personalized experiences. With our flagship service, digital content and service providers can easily package, distribute, and analyze the performance of widgets via a single platform. Clearspring is a privately funded company based in McLean, Virginia.”
“Gigya serves the world’s largest brands with a full-service widget advertising model covering design, development, hosting, distribution, viral promotion and tracking.”
Widgetbox’s Syndication Metrics
“Widgetbox’s Widget Syndication Metrics is an analytics dashboard for widget developers. It is free and comes with every widget on Widgetbox.”
“A Multimedia Player With A Revenue Model ”
“MuseStorm’s breakthrough analytics give publishers and marketers previously unattainable precise distribution and audience interaction metrics, including impressions, video playback, rollovers, and clickthroughs. With this intelligence, companies can optimize their content and delivery in real time to maximize the engagement of their audience.”
If you want to learn more about widget strategy, this podcast with Clearspring is very helpful.
Know of others? Please leave a comment.
Dave McClure (who helps teach the Stanford Facebook class, and runs the Graphing Social Patterns conference), Justin Smith (of Inside Facebook), Rodney Rumford (of FaceReviews), and myself brainstormed last night trying to understand the current state and direction of the emerging widget industry.
The widget universe is vast with a lot of variation. So although the initial goals was to try to categorize the widgets into clean buckets, and we found that to be an impossible task. Widgets can often have multiple attributes, so instead we focused on attributes and characteristics, rather than groupings. We developed a couple of models, (none that are perfected) but noticed a few ways to look at the attributes:
Levels of Data Interaction
Highest | Application uses data from your social network | iLike
High | Application uses data from your preferences | Pandora
Low | Application pulls data from source | Audio stream (like a radio station)
None | Static widget, display badge | Widget links to other website
We also explored a model of self-expression/vanity/entertainment vs utility and communication. And also found that some apps have different lifecycles from simple one time users (disposable widgets) or to those that got more value over time as network usage increased.
Later, Ro Choy from RockYou came by and presented me with a very clear definition of the differences between widgets and applications. Essentially (and I have a video of him to come) widgets are limited in functionality (due to limitations in size), usually resulting in the widget creator trying to get the user to go another website, vs an application that has full functionality, is on multiple pages, and therefore the widget creator doesn’t need to lead the user off the application.
So in summary, this was one of the first cracks at trying to segment the landscape, we’ll have to have subsequent meetings to drill down even farther. I’ll be mulling this whole thing over for the next few days/weeks to try to make sense of all the learnings. It’s a much larger universe (over 13,000 widgets exist, which will likely double this year) developing a taxonomy will be challenging and fun.
I was planning to live stream the event, but had issues with my wireless, although Rodney was taping and I’m sure he’ll post it. Chances are, you’ll find it very boring and dry, as we weren’t playing to the camera, we just had it on from the other side of the room as we discussed.
[Viral Marketing doesn't work, tell everyone you know]
Left: Dave McClure is being Ironic. According to Flickr, this is my MOST popular photograph, even more popular than my photo that got on digg and received 200,000 views.
Currently, there are over 13,000 widgets on Facebook, and we should expect that number to increase exponentially as companies like MySpace, Bebo, Friendster, LinkedIn, and all other networks become containers for widgets to grow on top of them.
Help users, marketers, developers, and the industry better understand the widget industry. Help define where widgets are heading, what are trends, and what to plan for next.
What we’re going to do
Sadly, there’s no way to accurately describe widgets, measure them consistently, or categorize them. As a result, tonight, I’ll be hosting Dave McClure (who helps teach the Stanford Facebook class, and runs the Graphing Social Patterns conference), Justin Smith (of Inside Facebook), Rodney Rumford (of FaceReviews), and colleague Charlene Li over to Forrester in Foster City (picture of building) to have a discussion about the widget industry. We’re going to do a landscape segmentation of this growing industry, map it out, so we can better understand the market, and thereby help support/analyze it.
Success for this widget industry mapping exercise looks like:
Be completely self-containable with no overlap with each other
Succinct and descriptive
Every widget will cleanly fall into one of those (or more than)
The labels will stand the test of time
Be vendor agnostic, and think of the bigger industry
I’ve been very transparent in my research process (while still maintaining value for my clients), I’ve recorded a few videos of folks I’ve interviewed for upcoming reports, and plan to live stream this discussion (providing it works, technically), and Rodney is going to film it and publish it. Watch my tweets around 4pm PST today for details.
In the future, I’ll be hosting other events for this social networking and social media industry, but my only requirement is that actual work get done and actual deliverables are created for my clients and the marketplace. It’s easy to be all talk, but let’s focus on deliverables.
I met up with CEO Jennifer Cooper of Mixercast (Widget mashup platform) last week in San Mateo (where several new startups are starting to call home, one was YouTube). We chatted over wine about the different phases of the web, and she broke it down to three succinct levels. We both agreed that the future of web strategy is distributed, and brands will need to create small applications that can travel the web to wherever communities form. Keep in mind that widgets are only one component of your web marketing strategy, the full list is here.
[As we evolve to each new phase on the web, one group gains prominance while the other becomes irrelevant, which side are you on?]
In each of the phases one group becomes irrelevant, the first phase, ‘Analog content’, the second phase, newspapers and mainstream media who didn’t adopt, and finally, the portals and aggregators and curators become irrelevant.
Like a smart fisherman (or fisherwoman) you should ‘fish where the fish are’, rather than constantly baiting your customers to return to your static website. Communities have formed elsewhere on the web where trusted decisions are being made by affinities and groups.
As a result, widgets are the new cell: it will travel, spread, and grow on different sites, and be a way for brands to ‘let go’ and let them proliferate.
Video of Marcia Kadanoff “The Future of the Web is Distributed” (2:42)
The Beginnings of a Distributed Web Strategy
The Four Pillars of a Distributed Web Strategy